ROYSTON MANNOR ESTATES, INC.
(Exact name of registrant as specified in its charter)
Nevada 88-0421129
(State of organization) (I.R.S. Employer Identification No.)
Las Vegas Commerce Center, 1350 E. Flamingo Road, Suite 688, Las Vegas,
NV 89119
(Address of principal executive offices)
Registrant's telephone number, including area code (702) 732-2253
Registrant's Attorney: Shawn Hackman, Esq., 3360 W. Sahara Ave., Suite
200, Las Vegas, NV 89102, (702) 732-2253
Securities to be registered pursuant to Section 12(b) of the Act: None
Securities to be registered pursuant to Section 12(g) of the Act: Common
ITEM 1. DESCRIPTION OF BUSINESS
Royston is a Nevada corporation formed on December 31, 1998. Its principal
place of business is located at Las Vegas Commerce Center, 1350 E. Flamingo
Road, Suite 688, Las Vegas, NV 89119. The Royston Mannor Estates, Inc. was
organized to engage in any lawful corporate business.
Royston's main focus will be the development of a company that wholesales
and retails wines made with petite sirah grapes. Southern California will be
the primary location the Company will investigate to set up its operation.
Royston may also participate in mergers with and acquisitions of other
companies. Royston Mannor Estates, Inc. has been in the developmental stage
since inception and has no operating history other than organizational matters.
Royston Mannor Estates, Inc. was organized on December 31, 1998, under the
laws of the State of Nevada, Royston Mannor Estates, Inc. has no operations
and in accordance with SFAS #7, is considered a development stage Company.
The primary activity of Royston Mannor Estates, Inc. currently involves
researching and developing a wholesale and retail winery. Royston Mannor
Estates, Inc.also participates in the business of engaging a company or
companies that it can acquire or with whom it can merge. Royston Mannor
Estates, Inc. has not selected any company as an acquisition target or merger
partner and 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. Royston Mannor Estates, Inc.'s
plans are in the conceptual stage only.
The Board of Directors has elected to begin implementing Royston Mannor
Estates, Inc.'s principal business purpose, described below under "Item 2,
Plan of Operation". As such, Royston Mannor Estates, Inc. can be defined as
a "shell" company., whose sole purpose at this time is to locate and
consummate a merger or acquisition with a private entity. The proposed
business activities described herein classify Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc.'s
securities until such time as the Company has successfully implemented its
business plan. Royston Mannor Estates, Inc. is filing this registration
statement on a voluntary basis, pursuant to section 12(g) of the Securities
Exchange Act of 1934 (the "Exchange Act"), in order to ensure that public
information is readily accessible to all shareholders and potential
investors, and to increase Royston Mannor Estates, Inc.'s access to financial
markets. In the event Royston Mannor Estates, Inc.'s obligation to file
periodic reports is suspended pursuant to the Exchange Act, Royston Mannor
Estates, Inc. anticipates that it will continue to voluntarily file such
reports.
Risk Factors
Royston Mannor Estates, Inc.'s business is subject to numerous risk factors,
including the following:
COMPETITION. The wine business is highly competitive. The Company will be
competing with a number of other potential suppliers of grapes and wine, most
of whom will have greater financial resources than the Company. In this
enviorment, there can be no assurance that there will be a suitable property
available for acquisition by the Company or that the Company can obtain
financing for, or participants to join in the development of a viable
vineyard operation without further fnancing. Most of the Company's
competitors have greater financial , personnel and other resources than does
the Company and therefore have a greater leverage to use in acquiring
properties, hiring personnel and marketing produce. Accordingly, a high
degree of competition in these areas is expected to continue.
GOVERNMENT REGULATION. The production and sale of grapes/wine is subject to
regulation by state, federal, local authorities, and foreign governments. In
most areas there are statutory provisions regulating the production of food
grapes and wine under which administrative agencies may change rules and
regulations without notice.
AVAILABILITY OF SUITABLE PROPERTIES. Competition for properties is intense.
The Company will be competing with a number of other potential purchasers of
suitable property, most of whom will have greater financial resources than
the Company.
NO OPERATING HISTORY OR REVENUE AND MINIMAL ASSETS. Royston Mannor Estates,
Inc. has had no operating history and has received no revenues or earnings
from operations. Royston Mannor Estates, Inc. has no significant assets or
financial resources. Royston Mannor Estates, Inc. will, in all likelihood,
sustain operating expenses without corresponding revenues, at least until it
completes a business combination. This may result in Royston Mannor Estates,
Inc. 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 Royston Mannor Estates, Inc. will
identify a business opportunity or complete a business combination.
SPECULATIVE NATURE OF ROYSTON MANNOR ESTATES, INC.'S PROPOSED OPERATIONS. The
success of Royston Mannor Estates, Inc.'s proposed plan of operation will
depend to a great extent on the operations, financial condition, and
management of the identified business opportunity. While management intends
to seek business combinations with entities having established operating
histories, it cannot assure that Royston Mannor Estates, Inc. will
successfully locate candidates meeting such criteria. In the event Royston
Mannor Estates, Inc. 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 Royston
Mannor Estates, Inc.'s control.
SCARCITY OF AND COMPETITION FOR BUSINESS OPPORTUNITIES AND COMBINATIONS.
Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc.. Nearly all such entities have
significantly greater financial resources, technical expertise, and
managerial capabilities than Royston Mannor Estates, Inc.. Royston Mannor
Estates, Inc. is, consequently, at a competitive disadvantage in identifying
possible business opportunities and successfully completing a business
combination. Moreover, Royston Mannor Estates, Inc. will also 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. Royston Mannor Estates, Inc. has no arrangement,
agreement, or understanding with respect to engaging in a business
combination with any private entity. There can be no assurance that Royston
Mannor Estates, Inc. 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. Royston Mannor Estates, Inc. has been in the developmental
stage since inception and has no operations to date. Other than issuing
shares to its original shareholders, Royston Mannor Estates, Inc. never
commenced any operational activities. There is no assurance that Royston
Mannor Estates, Inc. will be able to negotiate a business combination on
terms favorable to the company. Royston Mannor Estates, Inc. 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 Royston Mannor
Estates, Inc. would not consider a business combination in any form with such
business opportunity. Accordingly, Royston Mannor Estates, Inc. may enter
into a business combination with a business opportunity having no significant
operating history, losses, limited or no potential for earnings, limited
assets, negative net worth, or other negative characteristics. CONTINUED
MANAGEMENT CONTROL, LIMITED TIME AVAILABILITY. While seeking a business
combination, management anticipates devoting up to twenty hours per month to
the business of the company. Royston Mannor Estates, Inc.'s officers have
not entered into written employment agreements with the Company. and are not
expected to do so in the foreseeable future. Royston Mannor Estates, Inc. has
not obtained key man life insurance on its officers or directors.
Notwithstanding the combined limited experience and time commitment of
management, loss of the services of any of these individuals would adversely
affect development of Royston Mannor Estates, Inc.'s business and its
likelihood of continuing operations. See "MANAGEMENT."
CONFLICTS OF INTEREST - GENERAL. Royston Mannor Estates, Inc.'s officers and
directors participate 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 Royston Mannor Estates, Inc.'s
officers or directors are involved in the management of any firm with which
Royston Mannor Estates, Inc. transacts business. See "ITEM 5. DIRECTORS,
EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS - CONFLICTS OF INTEREST."
REPORTING REQUIREMENTS MAY DELAY OR PRECLUDE ACQUISITION. Companies subject
to Section 13 of the Securities Exchange Act of 1934 (the "Exchange Act")
must provide certain information about significant acquisitions, including
certified financial statements for Royston Mannor Estates, Inc. acquired,
covering one or two years, depending on the relative size of the acquisition.
The time and additional costs that may be incurred by some target entities to
prepare such statements may significantly delay or even preclude Royston
Mannor Estates, Inc. 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. Royston Mannor Estates,
Inc. has conducted minimal market research indicating that market demand
exists for the transactions contemplated by Royston Mannor Estates, Inc..
Moreover, Royston Mannor Estates, Inc. has limited marketing organization.
If there is demand for a business combination as contemplated by Royston
Mannor Estates, Inc., there is no assurance Royston Mannor Estates, Inc. will
successfully complete such transaction.
LACK OF DIVERSIFICATION. In all likelihood, Royston Mannor Estates, Inc.'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. Royston Mannor Estates, Inc.'s
inability to diversify its activities into a number of areas may subject
Royston Mannor Estates, Inc. to economic fluctuations within a particular
business or industry, thereby increasing the risks associated with Royston
Mannor Estates, Inc.'s operations.
REGULATION. Although Royston Mannor Estates, Inc. will be subject to
regulation under the Securities Exchange Act of 1934, management believes
Royston Mannor Estates, Inc. will not be subject to regulation under the
Investment Company Act of 1940, insofar as Royston Mannor Estates, Inc. will
not be engaged in the business of investing or trading in securities. In the
event Royston Mannor Estates, Inc. engages in business combinations which
result in Royston Mannor Estates, Inc. holding passive investment interests
in a number of entities, Royston Mannor Estates, Inc. could be subject to
regulation under the Investment Company Act of 1940. In such event, Royston
Mannor Estates, Inc. would be required to register as an investment company
and could be expected to incur significant registration and compliance costs.
Royston Mannor Estates, Inc. has obtained no formal determination from the
Securities and Exchange Commission as to the status of the company under the
Investment Company Act of 1940 and, consequently, any violation of such Act
would subject Royston Mannor Estates, Inc. to material adverse consequences.
PROBABLE CHANGE IN CONTROL AND MANAGEMENT. A business combination involving
the issuance of Royston Mannor Estates, Inc.'s common stock will, in all
likelihood, result in shareholders of a private company obtaining a
controlling interest in Royston Mannor Estates, Inc.. 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 Royston Mannor Estates, Inc.. The resulting change
in control of the company could result in removal of one or more present
officers and directors of Royston Mannor Estates, Inc. and a corresponding
reduction in or elimination of their participation in the future affairs of
Royston Mannor Estates, Inc..
REDUCTION OF PERCENTAGE SHARE OWNERSHIP FOLLOWING BUSINESS COMBINATION.
Royston Mannor Estates, Inc.'s primary plan of operation is based upon a
business combination with a private concern which, in all likelihood, would
result in Royston Mannor Estates, Inc. issuing securities to shareholders of
such private companies. Issuing previously authorized and unissued common
stock of Royston Mannor Estates, Inc. will reduce the percentage of shares
owned by present and prospective shareholders, and a change in Royston Mannor
Estates, Inc.'s control and/or management.
REQUIREMENT OF AUDITED FINANCIAL STATEMENTS MAY DISQUALIFY BUSINESS
OPPORTUNITIES.
Management believes that any potential target company 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 Royston Mannor Estates, Inc., 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 Royston
Mannor Estates, Inc. 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. These restrictions could reduce the
size of any potential market. As a result of recent changes in federal law,
non-issuer trading or resale of Royston Mannor Estates, Inc.'s securities is
exempt from state registration or qualification requirements in most states.
However, some states may continue to restrict the trading or resale of blind-
pool or "blank-check" securities. Accordingly, investors should consider any
potential secondary market for Royston Mannor Estates, Inc.'s securities to
be a limited one.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
This statement includes projections of future results and "forward-looking
statements" as that term is defined in Section 27A of the Securities Act of
1933 as amended (the "Securities Act"), and Section 21E of the Securities
Exchange Act of 1934 as amended (the "Exchange Act"). All statements that are
included in this Registration Statement, other than statements of historical
fact, are forward-looking statements. Although Management believes that the
expectations reflected in these forward-looking statements are reasonable, it
can give no assurance that such expectations will prove to have been correct.
Important factors that could cause actual results to differ materially from the
expectations are disclosed in this Statement, including, without limitation, in
conjunction with those forward-looking statements contained in this Statement.
Plan of Operation - General
Royston Mannor Estates first seeks to choose a region in California to
establish its vineyard for its petite sirah business.. Although Southern
California is a vast area, the different varietals of grapes grow only in
specific areas with the desirable qualities of soil, climate, rainfall and
temperature and are often situated in sheltered river valleys. Santa Ynez
Valley has deep alluvial soil, and is sheltered from ocean breezes. It is a
perfect area for a fledging wine operation, and prices are not as high as in
the Napa Valley, or Sonoma County. The Company hopes to find suitable
property in this area Royston Mannor Estates, Inc.'s also plans to seek,
investigate, and if such investigation warrants, acquire an interest in one
or more business opportunities presented to it by persons or firms desiring
the perceived advantages of a publicly held corporation. At this time,
Royston Mannor Estates, Inc. has no plan, proposal, agreement, understanding,
or arrangement to acquire or merge with any specific business or company and
Royston Mannor Estates, Inc. has not identified any specific business or a
company for investigation and evaluation. No member of Management or any
promoter of Royston Mannor Estates, Inc., or an affiliate of either, has had
any material discussions with any other company with respect to any
acquisition of Royston Mannor Estates, Inc. Royston Mannor Estates, Inc. 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. However, ### Royston will more throughly investigate companies that
are involved in the coding and encoding software. Discussion of the proposed
business under this caption and throughout this Registration Statement is
purposefully general and is not meant to restrict Royston Mannor Estates,
Inc.'s virtually unlimited discretion to search for and enter into a business
combination. Royston Mannor Estates, Inc. may seek a combination with a firm
which only recently commenced operations, or a developing company in need of
additional funds to expand into new products or markets or seeking to develop
a new product or service, or an established business which may be
experiencing financial or operating difficulties and needs additional capital
which is perceived to be easier to raise by a public company. In some
instances, a business opportunity 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.. Royston Mannor
Estates, Inc. may purchase assets and establish wholly-owned subsidiaries in
various businesses or purchase existing businesses as subsidiaries.
Selecting a business opportunity 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 facilitating or improving the terms on which additional equity
financing may be sought, providing liquidity for the principals of a
business, creating a means for providing incentive stock options or similar
benefits to key employees, providing liquidity (subject to restrictions of
applicable statues) for all shareholders, and other items. 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 Royston Mannor
Estates, Inc. 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, Royston Mannor
Estates, Inc. would be required to use less of its available funds to acquire
a target company and, therefore, 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 Royston Mannor Estates, Inc. must
commit to acquire a business, may correspondingly increase the risk of loss
to Royston Mannor Estates, Inc.. No assurance can be given as to the terms
or availability of financing for any acquisition by Royston Mannor Estates,
Inc.. During periods when interest rates are relatively high, the benefits of
leveraging are not as great as during periods of lower interest rates,
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 Royston Mannor Estates,
Inc. may obtain funds for purposes of a leveraged buy-out may impose
restrictions on the future borrowing, distribution, and operating policies of
Royston Mannor Estates, Inc.. It is not possible at this time to predict the
restrictions, if any, which lenders may impose, or the impact thereof on
Royston Mannor Estates, Inc.. Royston Mannor Estates, Inc. has insufficient
capital with which to provide the owners of businesses significant cash or
other assets. Management believes Royston Mannor Estates, Inc. will offer
owners of businesses the opportunity to acquire a controlling ownership
interest in a public 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. Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc. 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
businesses. Royston Mannor Estates, Inc. does not intend to make any loans to
any prospective merger or acquisition candidates or to unaffiliated third
parties. Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc. may offer. However, Royston Mannor
Estates, Inc. 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 Royston Mannor Estates, Inc. has successfully consummated
such a merger or acquisition. Royston Mannor Estates, Inc. also has no plans
to conduct any offerings under Regulation S.
Sources of Opportunities
Royston Mannor Estates, Inc. 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
Royston Mannor Estates, Inc. will engage professional firms specializing in
business acquisitions or reorganizations. Management, while not especially
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 Royston
Mannor Estates, Inc.'s shareholders, in accomplishing the business purposes
of Royston Mannor Estates, Inc.. It is not anticipated that any outside
consultants or advisors, other than Royston Mannor Estates, Inc.'s legal
counsel and accountants, will be utilized by Royston Mannor Estates, Inc. to
effectuate its business purposes described herein. However, if Royston Mannor
Estates, Inc. 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 Royston Mannor Estates, Inc. 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, Royston Mannor Estates, Inc.'s
management has never used outside consultants or advisors in connection with
a merger or acquisition. As is customary in the industry, Royston Mannor
Estates, Inc. may pay a finder's fee for locating an acquisition prospect. If
any such fee is paid, it will be approved by Royston Mannor Estates, Inc.'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. Such fees are typically in
the range of 5% on a $1,000,000 transaction ratably down to 1% in a
$4,000,000 transaction. Management has adopted a policy that such a finder's
fee or real estate brokerage fee could, in certain circumstances, be paid to
any employee, officer, director or 5% shareholder of Royston Mannor Estates,
Inc., if such person plays a material role in bringing a transaction to
Royston Mannor Estates, Inc..
Evaluation of Opportunities
The analysis of new business opportunities will be undertaken by or under the
supervision of the officers and directors of Royston Mannor Estates, Inc.
(see "Management"). Management intends to concentrate on identifying
prospective business opportunities which may be brought to its attention
through present associations with management. In analyzing prospective
business opportunities, management will consider, among other factors, such
matters as;
1. the 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. the quality and experience of management services which may be available
and the depth of that management
7. the potential for further research, development or exploration
8. specific risk factors not now foreseeable but which then may be
anticipated to impact the proposed activities of Royston Mannor Estates, Inc.
9. the potential for growth or expansion
10. the potential for profit
11. the perceived public recognition or acceptance of products, services or
trades
12. name identification
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, Royston Mannor Estates, Inc. intends to utilize written
reports and personal investigation to evaluate the above factors. Royston
Mannor Estates, Inc. will not acquire or merge with any company for which
audited financial statements cannot be obtained. Opportunities in which
Royston Mannor Estates, Inc. participates will present certain risks, many of
which cannot be identified adequately prior to selecting a specific
opportunity. Royston Mannor Estates, Inc.'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 (in that it has not generated significant
revenues from its principal business activities prior to Royston Mannor
Estates, Inc.'s participation.) Even after Royston Mannor Estates, Inc.'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 Royston Mannor Estates, Inc.
and, therefore, its shareholders.
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 as
well as substantial costs for accountants, attorneys, and others. If a
decision is made not to participate in a specific business opportunity the
costs incurred in the related investigation would 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 by Royston Mannor Estates, Inc. of the related costs
incurred. There is the additional risk that Royston Mannor Estates, Inc.
will not find a suitable target. Management does not believe Royston Mannor
Estates, Inc. 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 Royston Mannor Estates, Inc.'s
stock.
Acquisition of Opportunities
In implementing a structure for a particular business acquisition, Royston
Mannor Estates, Inc. may become a party to a merger, consolidation,
reorganization, joint venture, franchise, or licensing agreement with another
corporation or entity. It may also purchase stock or assets of an existing
business. Once a transaction is complete, it is possible that the present
management and shareholders of Royston Mannor Estates, Inc. will not be in
control of the company. In addition, a majority or all of Royston Mannor
Estates, Inc.'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 Royston Mannor Estates, Inc.'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, Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc.'s Common Stock may
have a depressive effect on such market. While the actual terms of a t
ransaction to which Royston Mannor Estates, Inc. may be a party cannot be
predicted, it may be expected that the parties to the business transaction
will find it desirable to avoid the creation of a taxable event and thereby
structure the acquisition in a so called "tax free" reorganization under
Sections 368(a)(1) or 351 of the Internal Revenue Code 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
Royston Mannor Estates, Inc., 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 Royston Mannor Estates, Inc.'s investigation, officers and
directors of Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc.'s
limited financial resources and management expertise. The manner in which
Royston Mannor Estates, Inc. participates in an opportunity with a target
company will depend on the nature of the opportunity, the respective needs and
desires of the company and other parties, the management of the opportunity,
and the relative negotiating strength of the company and such other management.
With respect to any mergers or acquisitions, negotiations with target
company, management will be expected to focus on the percentage of Royston
Mannor Estates, Inc. 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, Royston Mannor
Estates, Inc.'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 Royston Mannor Estates, Inc. acquires a target company with
substantial assets. Any merger or acquisition effected by Royston Mannor
Estates, Inc. can be expected to have a significant dilutive effect on the
percentage of shares held by Royston Mannor Estates, Inc.'s then
shareholders, including purchasers in this offering. Management has
advanced, and will continue to advance, funds which shall be used by Royston
Mannor Estates, Inc. 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.
Competition
Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc.. In view of Royston Mannor
Estates, Inc.'s limited financial resources and management availability,
Royston Mannor Estates, Inc. will continue to be at significant competitive
disadvantage vis-a-vis the Royston Mannor Estates, Inc.'s competitors.
The business of coding and encoding computer software and files is intensely
competive in all of its phases, and the Company will be competing with many
firms providing this service . The Company will be at at disadvantge with
other companies having larger technical staffs, established market shares and
greater financial backing.
Regulation and Taxation
The Investment Company Act of 1940 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. While Royston
Mannor Estates, Inc. does not intend to engage in such activities, Royston
Mannor Estates, Inc. may obtain and hold a minority interest in a number of
development stage enterprises. Royston Mannor Estates, Inc. could be expected
to incur significant registration and compliance costs if required to
register under the Investment Company. Act of 1940. Accordingly, management
will continue to review Royston Mannor Estates, Inc.'s activities from time
to time with a view toward reducing the likelihood Royston Mannor Estates,
Inc. could be classified as an "investment company." Royston Mannor Estates,
Inc. intends to structure a merger or acquisition in such manner as to
minimize Federal and state tax consequences to Codaek Corp., and to any target
company.
Employees
Royston Mannor Estates, Inc.'s only employees at the present time are its
officers and directors, who will devote as much time as the Board of
Directors determine is necessary to carry out the affairs of the Royston
Mannor Estates, Inc.. (See "Management").
ITEM 3. DESCRIPTION OF PROPERTY.
Royston Mannor Estates, Inc. neither owns nor leases any real property at
this time. Royston Mannor Estates, Inc. conducts its business from
Vegas Commerce Center, 1350 E.
Flamingo Road, Suite 688, Las Vegas, NV 89119.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
As of December 31,1998, no one is the beneficial owner of five percent (5%)
or more of Royston Mannor Estates, Inc.'s common stock. The management of
Royston does not own any stock in the Company.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS
The members of the Board of Directors of Royston Mannor Estates, Inc. serve
until the next annual meeting of the stockholders, or until their successors
have been elected. The 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.
Royston Mannor Estates, Inc.'s officers and directors will devote their time
to the business on an "as-needed" basis, which is expected to require 5-10
hours per month.
Information as to the directors and executive officers of the Royston Mannor
Estates, Inc. is as follows:
Name
Age
Position
Harvey Makaiwi
48
President, Sole Officer, and
Director
Harvey Makaiwi Age 48
Operated a pottery mail order business from 1990 to 1996. Developed an
interest in wine in Europe while on tour with husband in the US military.
Formed Mount Merlot Estates in 1996. Retired from that business in 1998 to
pursue current company.
Blank Check Experience
None.
There is no family relationship between any of the officers and directors of
the Royston Mannor Estates, Inc.. The Royston Mannor Estates, Inc.'s Board of
Directors has not established any committees.
Conflicts of Interest
Insofar as the officers and directors are engaged in other business activities,
management anticipates it will devote only a minor amount of time to Royston
Mannor Estates, Inc.'s affairs. The officers and directors of Royston Mannor
Estates, Inc. may in the future become shareholders, officers or directors of
other companies which may be formed for the purpose of engaging in business
activities similar to those conducted by Royston Mannor Estates, Inc..
Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc.'s proposed
business operations.
The officers and directors are, so long as they are officers or directors of
Royston Mannor Estates, Inc., subject to the restriction that all
opportunities contemplated by Royston Mannor Estates, Inc.'s plan of
operation which come to their attention, either in the performance of their
duties or in any other manner, will be considered opportunities of, and be
made available to Royston Mannor Estates, Inc. and the companies that they
are affiliated with on an equal basis. A breach of this requirement will be a
breach of the fiduciary duties of the officer or director. Subject to the
next paragraph, if a situation arises in which more than one company desires
to merge with or acquire that target company and the principals of the
proposed target company have no preference as to which company will merge or
acquire such target company., 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, Royston Mannor Estates, Inc. has not adopted any
other conflict of interest policy with respect to such transactions.
Investment Company Act of 1940
Although Royston Mannor Estates, Inc. will be subject to regulation under the
Securities Act of 1933 and the Securities Exchange Act of 1934, management
believes Royston Mannor Estates, Inc. will not be subject to regulation under
the Investment Company Act of 1940 insofar as Royston Mannor Estates, Inc.
will not be engaged in the business of investing or trading in securities. In
the event Royston Mannor Estates, Inc. engages in business combinations which
result in Royston Mannor Estates, Inc. holding passive investment interests
in a number of entities, Royston Mannor Estates, Inc. could be subject to
regulation under the Investment Company Act of 1940. In such event, Royston
Mannor Estates, Inc. would be required to register as an investment company
and could be expected to incur significant registration and compliance costs.
Royston Mannor Estates, Inc. has obtained no formal determination from the
Securities and Exchange Commission as to the status of the company under the
Investment Company Corp. Act of 1940 and, consequently, any violation of such
Act would subject Royston Mannor Estates, Inc. to material adverse consequences.
ITEM 6. EXECUTIVE COMPENSATION
There is no executive compensation given to any officers and directors of the
company. It is possible that, after Royston Mannor Estates, Inc.
successfully consummates a merger or acquisition with an unaffiliated entity,
that entity may desire to employ or retain one or more members of Royston
Mannor Estates, Inc.'s management for the purposes of providing services to
the surviving entity, or otherwise provide other compensation to such persons.
It is possible that persons associated with management may refer a
prospective merger or acquisition candidate to Royston Mannor Estates, Inc..
In the event Royston Mannor Estates, Inc. 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 Royston Mannor Estates, Inc. 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 Royston Mannor
Estates, Inc. has insufficient cash available. The amount of such finder's
fee cannot be determined as of the date of this registration statement, but
is expected to be comparable to consideration normally paid in like
transactions. No member of management of Royston Mannor Estates, Inc. will
receive any finders fee, either directly or indirectly, as a result of their
respective efforts to implement Royston Mannor Estates, Inc.'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 Registrant for the benefit of its employees.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None
ITEM 8. LEGAL PROCEEDINGS
Royston Mannor Estates, Inc. is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by or against
Royston Mannor Estates, Inc. has been threatened.
ITEM 9. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
Royston Mannor Estates, Inc.'s common stock is not traded on any exchange or
OTC market. 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 Royston Mannor Estates, Inc.'s
securities and management does not intend to initiate any such discussions
until such time as Royston Mannor Estates, Inc. 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 merger or
acquisition has been completed, one or both of the company's officers and
directors will most likely be the persons to contact prospective market
makers. It is also possible that persons associated with the entity that
merges with or is acquired by Royston Mannor Estates, Inc. will contact
prospective market makers. Royston Mannor Estates, Inc. does not intend to
use consultants to contact market makers.
Market Price
The Registrant's Common Stock is not quoted at the present time.
Effective August 11, 1993, the Securities and Exchange Commission adopted
Rule 15g-9, which established the definition of a "penny stock," for purposes
relevant to Royston Mannor Estates, Inc., as any equity security that has a
market price of less than $5.00 per share or with an exercise price of less
than $5.00 per share, subject to certain exceptions. For any transaction
involving a penny stock, unless exempt, the rules require: (i) that a broker
or dealer approve a person's account for transactions in penny stocks; and
(ii) the broker or dealer receive from the investor a written agreement to
the transaction, setting forth the identity and quantity of the penny stock
to be purchased. In order to approve a person's account for transactions in
penny stocks, the broker or dealer must (i) obtain financial information and
investment experience and objectives of the person; and (ii) make a
reasonable determination that the transactions in penny stocks are suitable
for that person and that person has sufficient knowledge and experience in
financial matters to be capable of evaluating the risks of transactions in
penny stocks. The broker or dealer must also deliver, prior to any
transaction in a penny stock, a disclosure schedule prepared by the
Commission relating to the penny stock market, which, in highlight form,
(i) sets forth the basis on which the broker or dealer made the suitability
determination; and (ii) that the broker or dealer received a signed,
written agreement from the investor prior to the transaction. Disclosure also
has to be made about the risks of investing in penny stocks in both public
offerings and in secondary trading, and about commissions payable to both the
broker-dealer and the registered representative, current quotations for the
securities and the rights and remedies available to an investor in cases of
fraud in penny stock transactions. Finally, monthly statements have to be
sent disclosing recent price information for the penny stock held in the
account and information on the limited market in penny stocks. The National
Association of Securities Dealers, Inc. (the "NASD"), which administers
NASDAQ, 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 per share. In order to
continue to be included on NASDAQ, 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 Royston Mannor Estates,
Inc.'s securities to be traded without the aforesaid limitations. However,
there can be no assurances that, upon a successful merger or acquisition,
that Royston Mannor Estates, Inc. will qualify its securities for listing on
NASDAQ or some other national exchange, or be able to maintain the
maintenance criteria necessary to insure continued listing. The failure of
Royston Mannor Estates, Inc. 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 Royston Mannor Estates,
Inc.'s securities on a national exchange. In such events, trading, if any, in
Royston Mannor Estates, Inc.'s securities may then continue in the non-NASDAQ
over-the-counter market. As a result, a shareholder may find it more
difficult to dispose of, or to obtain accurate quotations as to the market
value of, Royston Mannor Estates, Inc.'s securities.
Holders
As of September 30,1999, there are 65 holders of Royston Corp's common
shares. 40 of these shareholders hold unrestricted stock pursuant to
Rule 504 of Regulation D, Section 4(6) exemption. Twenty Five shareholders
hold restricted stock pursuant to Rule 144.
Dividends
The Registrant has not paid any dividends to date, and has no plans to do so
in the immediate future.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES.
With respect to the sales made, the Registrant relied on Section 4(2) of the
Securities Act of 1933, as amended. 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 11. DESCRIPTION OF SECURITIES.
Common Stock
Royston Corp was incorporated on December 31, 1998, as Royston Mannor
Estates, Inc., with an authorized share capital of Fifty Million (50,000,000)
shares of Common Stock. Upon incorporation, the company initially issued One
Hundred Thousand (100,000) Common Shares with par value of $.001. These
shares were restricted under Rule 144 of the Securities Act of 1933, as
amended.
On February 15, 1999 the Company offered, pursuant to a 504D Offering filed
with the Securities and Exchange Commission, One Million, 1,000,000, Common
Shares at $0.10 per share. On March 25, 1999, the Company sold and issued Two
Hundred Thousand (200,000) Common Shares at $0.10 per share from that 504D
Offering. These 200,000 shares have been deemed free trading by counsel.
The Royston Mannor Estates, Inc.'s Articles of Incorporation authorizes the
issuance of 50,000,000 shares of Common stock, of which 300,000 are issued
and outstanding. The 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 the
stockholders. The shares are fully paid, non-assessable, without pre-emptive
rights, and do not carry cumulative voting rights. Holders of common shares
are entitled to share ratably in dividends, if any, as may be declared by
Royston Mannor Estates, Inc. from time-to-time, from funds legally available.
In the event of a liquidation, dissolution, or winding up of Royston Mannor
Estates, Inc., 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 Royston Mannor Estates, Inc.'s stock are to be issued
to management or promoters, or affiliates or associates of either.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Royston Mannor Estates, Inc. and its affiliates may not be liable to its
shareholders for errors in judgment or other acts or omissions not amounting
to intentional misconduct, fraud, or a knowing violation of the law, since
provisions have been made in the Articles of incorporation and By-laws
limiting such liability. The Articles of Incorporation and By-laws also
provide for indemnification of the officers and directors of Royston Mannor
Estates, Inc. in most cases for any liability suffered by them or arising
from their activities as officers and directors of Royston Mannor Estates,
Inc. if they were not engaged in intentional misconduct, fraud, or a knowing
violation of the law. Therefore, purchasers of these securities may have a
more limited right of action than they would have except for this limitation
in the Articles of Incorporation and By-laws. The officers and directors of
Royston Mannor Estates, Inc. are accountable to Royston Mannor Estates, Inc.
as fiduciaries, which means such officers and directors are required to
exercise good faith and integrity in handling Royston Mannor Estates, Inc.'s
affairs. A shareholder may be able to institute legal action on behalf of
himself and all others similarly stated shareholders to recover damages where
Royston Mannor Estates, Inc. has failed or refused to observe the law.
Shareholders may, subject to applicable rules of civil procedure, be able to
bring a class action or derivative suit to enforce their rights, including
rights under certain federal and state securities laws and regulations.
Shareholders who have suffered losses in connection with the purchase or sale
of their interest in Royston Mannor Estates, Inc. in connection with such
sale or purchase, including the misapplication by any such officer or
director of the proceeds from the sale of these securities, may be able to
recover such losses from Royston Mannor Estates, Inc..
ITEM 13. FINANCIAL STATEMENTS.
The financial statements and supplemental data required by this Item 13
follow the index of financial statements appearing at Item 15 of this Form
10-SB.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
The Registrant has not changed accountants since its formation, and
Management has had no disagreements with the findings of its accountants.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS.
FINANCIAL STATEMENTS
EXHIBITS
3.1 Articles of Incorporation
3.2 By-Laws
ROYSTON MANNOR ESTATES, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
DECEMBER 31, 1999, AND
DECEMBER 31, 1998
TABLE OF CONTENTS
PAGE NUMBER
INDEPENDENT ACCOUNTANT'S REPORT 1
FINANCIAL STATEMENT
Balance Sheet 2
Statements of Operations and Deficit
Accumulated During the Development Stage 3
Statement of Changes in Stockholders' Equity 4
Statements of Cash Flows 5
Notes to the Financial Statements 6
David E. Coffey
Certified Public Accountant
3651 Lindell Road, Suite A
Las Vegas, NV 89103
(702) 871-3979
INDEPENDENT ACCOUNTANT'S REPORT
To the Board of Directors and Stockholders
of Royston Mannor Estates, Inc.
Las Vegas, Nevada
I have audited the accoumpanying balance sheets of Royston Mannor
Estates, Inc., (a development stage company) as of December 31, 1999,
and December 31, 1998, and the related statements of operations, cash
flows, and changes in stockholders' equity for the period from December 31,
1998, (date of inception) to December 31, 1999. These statements are
the responsibility of Royston Mannor Estates, Inc.'s management. My
responsibility is to express an opinion on these financial statements based
on my audit.
I conducted my audit in accordance with generally accepted
auditing standards. Those standards require that I 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. I believe that my audit provides a reasonable
basis for my opinion.
In my opinion, the accompanying financial statements present
fairly, in all material respects, the financial position of Royston Mannor
Estates, Inc. as of December 31, 1999, and December 31, 1998, and
the results of operations, cash flows, and changes in stockholders'
equity for the periods then ended, as well as the cumulative period
from December 31, 1998, in conformity with generally accepted
accounting principles.
David Coffey, C.P.A.
Las Vegas, Nevada
February 21, 2000
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
DEC. 31, 1999 DEC. 31, 1998
ASSETS
Cash $ 7,048 $ 100
------------ ------------
$ 7,048 $ 100
============ ============
LIABILIES & STOCKHOLDERS' EQUITY
Accounts payable $ 400 $ 400
------------ -------------
Total Liabilities 400 400
Stockholder's Equity
Common stock, authorized 50,000,000
shares at $.001 par value, issued and
outstanding 350,000 shares and
100,000 shares, respectively 350 100
Additional paid-in capital 26,750 0
Deficit accumulated during the
development stage (20,452) (400)
------------- --------------
Total Stockholders' Equity 6,648 (300)
Total Liablilites and Stockholder's Equity $ 7,048 $ 100
========== ==============
The accompanying notes are an integral part of these financial statements.
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS AND DEFICIT
ACCUMULATED DURING THE DEVELOPMENT STAGE
(With Cumulative Figures From Inception)
From Inception
Jan. 1, 1999, to Dec. 31, 1998 to Dec. 31, 1998, to
Dec. 31, 1999 Dec. 31, 1998 Dec. 31, 1999
---------------- ---------------- -----------------
Income $ 0 $ 0 0
Expenses
Organizational expense 0 400 400
Consulting 20,000 0 20,000
Office expenses 52 0 52
---------------- ---------------- -----------------
Total expenses 20,052 400 20,452
Net loss (20,052) (400) $ (20,452)
=================
Retained earnings,
beginning of period (400) 0
---------------- ----------------
Deficit accumulated during
the development stage $ (20,452) $ (400)
================ =================
Earnings (loss) per share
assuming dilution:
Net loss $ (0.07) $ 0.00 $ (0.08)
================ ================= ================
Weighted average shares
outstanding 279,167 100,000 265,385
================ ================= ================
The accompanying notes are an integral part of these financial statements.
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM DECEMBER 31, 1998, (Date of Inception) TO
DECEMBER 31, 1999
Common Stock Additional Total
Shares Amount Paid-in
Capital
------- ------ ---------- ---------
Balance,
December 31, 1998 - - - -
Issuance of common stock for cash
December, 1998 100,000 100 0 100
Less net loss 0 0 0 (400)
------- ------ ---------- ---------
Balance,
December 31, 1998 100,000 100 0 (300)
Issuance of common stock for cash
March, 1999 200,000 200 19,800 20,000
Less offering costs 0 0 (3,000) (3,000)
Issuance of common stock for cash
October, 1999 50,000 50 9,950 10,000
Less net loss 0 0 0 (20,052)
-------- ------- ---------- ---------
Balance,
December 31, 1999 350,000 $ 350 $ 26,750 $ 6,648
======== ======== =========== ==========
The accompanying notes are an integral part of these financial statements.
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(With Cumulative Figures From Inception)
From Inception,
Jan. 1, 1999, to Dec. 31, 1998, to Dec. 31, 1998, to
Dec. 31, 1999 Dec. 31, 1998 Dec. 31, 1999
---------------- ----------------- -----------------
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES
Net Loss $ (20,052) $ (400) $ (20,452)
Non-cash items included
in net loss 0 0 0
Adjustments to reconcile
net loss to cash used by
operating activity
Accounts Payable 0 400 400
----------------- ------------------ ----------------
NET CASH PROVIDED BY
OPERATING ACTIVITIES (20,052) 0 (20,052)
CASH FLOWS USED BY
INVESTING ACTIVITIES 0 0 0
------------------ ------------------ ---------------
NET CASH USED BY
INVESTING ACTIVITIES 0 0 0
CASH FLOWS FROM FINANCING
ACTIVITIES
Sale of common stock 250 100 350
Paid-in capital 29,750 0 29,750
Less offering costs (3,000) 0 (3,000)
-------------------- ------------------ --------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 27,000 100 27,100
-------------------- ------------------ --------------
NET INCREASE IN CASH 6,948 100 $ 7,048
==============
CASH AT BEGINNING OF
PERIOD 100 0
-------------------- -------------------
CASH AT END OF PERIOD $ 7,048 $ 100
==================== ===================
The accompanying notes are an integral part of these financial statements.
ROYSTON MANNOR ESTATES, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 1999, AND DECEMBER 31, 1998
NOTE A SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company was incorporated on December 31, 1998, under
the laws of the State of Neveda. The business purpose of
the Company is to market specialty wines in the United States.
The Company will adopt accounting policies and procedures
based upon the nature of future transactions.
NOTES B OFFERING COSTS
Offering costs are reported as a reduction in the amount of
paid-in capital received for sale of the shares.
NOTES C EARNINGS (LOSS) PER SHARE
Basic EPS is determined using net income divided by the
weighted average shares outstanding during the period.
Diluted EPS is computed by dividing net income by the
weighted average shares outstanding, assuming all dilutive
potential common shares were issued. Since the Company
has no common shares that are potentially issuable, such as
stock options, convertible securities or warrants, basic and
diluted EPS are the same.
NOTES D STOCK OFFERINGS
In March of 1999, the Company completed the sale of
200,000 shares of its common stock at $.10 per share
for a total of $20,000. The proceeds were to be used for the
marketing of specialty wines.
In October of 1999, the Company sold, by private placement,
50,000 shares of its common stock at $.20 per share for a total of
$10,000. The proceeds were to be used for working capital.
ARTICLES OF INCORPORATION
OF
Royston Mannor Estates, Inc.
KNOW ALL MEN BY THESE PRESENTS:
That we, the undersigned, have this day voluntarily associated ourselves
together for the purpose of forming a Corporation under and pursuant to the
laws of the State of Nevada, and we do hereby certify that:
ARTICLE I NAME: The exact name of this Corporation is:
Royston Mannor Estates, Inc.
ARTICLE II RESIDENT AGENT:
The Resident Agent of the Corporation is Bruce Thompson, 128 Fortune Drive,
Dayton, Nevada 89403.
ARTICLE III DURATION:
The Corporation shall have perpetual existence.
ARTICLE IV PURPOSES:
The purpose, object and nature of the business for which this Corporation is
organized are:
(a) To engage in any lawful activity;
(b) To carry on such business as may be necessary, convenient, or
desirable to accomplish the above purposes, and to do all other things
incidental thereto which are not forbidden by law or by these Articles
of Incorporation.
ARTICLE V POWERS:
The powers of the Corporation shall be those powers granted by 78.060 and
78.070 of the Nevada Revised Statutes under which this corporation is
formed. In addition, the Corporation shall have the following specific
powers:
(a) To elect or appoint officers and agents of I the Corporation and to
fix their compensation;
(b) To act as an agent for any individual, association, partnership,
corporation or other legal entity;
1
(c) To receive, acquire, hold, exercise rights arising out of the
ownership or possession- thereof, sell, or otherwise dispose of, shares
or other interests in, or obligations of, individuals, associations,
partnerships, corporations, or governments;
(d) To receive, acquire, hold, pledge, transfer, or otherwise dispose of
shares of the corporation, but such shares may only be purchased,
directly or indirectly, out of earned surplus;
(e) To make gifts or contributions for the public welfare or for
charitable, scientific or educational purposes, and in time of war, to
make donations in aid of war
activities.
ARTICLE VI CAPITAL STOCK:
Section 1. Authorized shares. The total number of shares which this
Corporation is authorized to issue is 50,000,000 shares of Capital Stock at
$.001 par value per share.
Section 2. Voting Rights of Shareholders. Each holder of the Common Stock
shall be entitled to one vote for each share of stock standing in his name
on the books of the Corporation.
Section 3. Consideration for Shares. The Common Stock shall be issued for
such consideration, as shall be fixed from time to time by the Board of
Directors. In the absence of fraud, the judgment of the Directors as to the
value of any property for shares shall be conclusive. When shares are
issued upon payment of the consideration fixed by the Board of Directors,
such shares shall be taken to be fully paid stock and shall be
non-assessable. The Articles shall not be amended in this particular.
Section 4. Pre-emptive Rights. Except as may otherwise be provided by the
Board of Directors, no holder of any shares of the stock of the Corporation,
shall have any preemptive right to purchase, subscribe for, or otherwise
acquire any shares or stock of the Corporation of any class now or hereafter
authorized, or any securities exchangeable for or
convertible into such shares, or any warrants or other instruments
evidencing rights or options to subscribe for, purchase, or otherwise
acquire such shares.
Section 5. Stock Rights and Options. The Corporation shall have the power to
create and issue rights, warrants, or options entitling the holders thereof
to purchase from the corporation any shares of its capital stock of any
class or classes, upon such terms and conditions and at
such times and prices as the Board of Directors may provide, which
2
terms and conditions shall be incorporated in an instrument or instruments
evidencing such rights. In the absence of fraud, the judgment of the
Directors as to the adequacy of consideration for the issuance of such
rights or options and the sufficiency thereof shall be conclusive.
ARTICLE VII ASSESSMENT OF STOCK:
The capital stock of this Corporation, after the amount of the subscription
price has been fully paid in, shall not be assessable for any purpose, and
no stock issued as fully paid up shall ever be assessable or assessed. The
holders of such stock shall not be individually responsible for the debts,
contracts, or liabilities of the Corporation and shall not be liable for
assessments to restore impairments in the capital of the Corporation.
ARTICLE VIII DIRECTORS:
For the management of the business, and for the conduct of the affairs of
the Corporation, and for the future definition, limitation, and regulation
of the powers of the Corporation and its directors and shareholders, it is
further provided:
Section 1, Size of Board. The members of the governing board of the
Corporation shall be styled directors. The number of directors of the
Corporation, their qualifications, terms of office, manner of election, time
and place of meeting, and powers and duties shall be such as are prescribed
by statute and in the by-laws of the Corporation. The name and post office
address of the directors constituting the first board of directors, which
shall be One (1) in number are:
NAME ADDRESS
David Wages 500 W. College Parkway #V386 Carson City, Nevada 89706
Section 2. Powers of Board. In furtherance and not in limitation of the
powers conferred by the laws of the State of Nevada, the Board of Directors
is expressly authorized and empowered:
(a) To make, alter, amend, and repeal the by-laws subject to the power of
the shareholders to alter or repeal the by-laws made by the Board of
Directors.
(b) Subject to the applicable provisions of the by-laws then in effect, to
determine, from time to time, whether and to what extent, and at what
times and places, and under what conditions and
3
regulations, the accounts and books of the corporation, or any of them,
shall be open to shareholder inspection. No shareholder shall have any
right to inspect any of the accounts, books or documents of the
Corporation, except as permitted by law, unless and until authorized to
do so by resolution of the Board of Directors or of the Shareholders of
the Corporation;
(c) To issue stock of the Corporation for money, property, services
rendered, labor performed, cash advanced, acquisitions for other
corporations or for any other assets of value in accordance with the
action of the board of directors without vote or consent of the
shareholders and the judgment of the board of directors as to value
received and in return therefore shall be conclusive and said stock,
when issued, shall be fully-paid and non-assessable.
(d) To authorize and issue, without shareholder consent, obligations of
the Corporation, secured and unsecured, under such terms and conditions
as the Board, in its sole discretion, may determine, and to pledge or
mortgage, as security therefore, any real or personal property of the
Corporation, including after-acquired property;
(e) To determine whether any and, if so, what part, of the earned
surplus of the Corporation shall be paid in dividends to the
shareholders, and to direct and determine other use and disposition of
any such earned surplus;
(f) To fix, from time to time, the amount of the profits of the
Corporation to be reserved as working capital or for any other lawful
purpose;
(g) To establish bonus, profit-sharing, stock option, or other types of
incentive compensation plans for the employees, including officers and
directors, of the Corporation, and to fix the amount of profits to be
shared or distributed, and to determine the persons to participate in
any such plans and the amount of their: respective participation.
(h) To designate, by resolution or resolutions passed by a majority of
the whole Board, one or more committees, which, to the extent permitted
by law and authorized by the resolution or the by-laws, shall have and
may exercise the powers of the Board;
(i) To provide for the reasonable compensation of its own members by
by-law, and to fix the terms and conditions upon which such
compensation will he paid;
4
(j) In addition to the powers and authority herein before, or by
statute, expressly conferred upon it, the Board of Directors may
exercise all such powers and do all such acts and things as may be
exercised or done by the corporation, subject, nevertheless, to the
provisions of the laws of the State of Nevada, of these Articles of
Incorporation, and of the by-laws of the Corporation.
Section 3. Interested Directors. No contract or transaction between this
Corporation and any of its directors, or between this Corporation and any
other corporation, firm, ..association, or other legal entity shall be
invalidated, by reason of the fact that the director of the Corporation has
a direct or indirect interest, pecuniary or otherwise, in such corporation,
firm, association, or legal entity, or because the interested director was
present at the meeting of the Board of Directors which acted upon or in
reference to such contract or transaction, or because he participated in
such action, provided that: (1) the interest of each such director shall
have been disclosed to or known by the Board and a disinterested majority of
the Board shall have nonetheless ratified and approved such contract or
transaction (such interested director or directors may be counted in
determining whether a quorum is present for the meeting at which such
ratification or approval is given); or (2) the conditions of MR. S. 78.140
are met.
ARTICLE IX LIMITATION OF LIABILITY OF OFFICERS OR DIRECTORS:
The personal liability of a director or officer of the corporation to the
corporation or the Shareholders for damages for breach of fiduciary duty as
a director or officer shall be limited to acts or omissions which involve
intentional misconduct, fraud or a knowing violation of law.
ARTICLE X INDEMNIFICATION:
Each director and each officer of the corporation may be indemnified by the
corporation as follows:
(a) The corporation may indemnify 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 (other than an action by or in the right of the
corporation), by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys' fees) ,
judgments, fines and amounts paid in settlement, actually and
reasonably incurred by him in connection with the action, suit or
proceeding, if he acted in good faith and in a
5
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation and with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suite or proceeding, by
judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, does not of itself create a presumption
that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of
the corporation, and that, with respect to any criminal action or
proceeding, he had reasonable cause to believe that his conduct was
unlawful.
(b) The corporation may indemnify any person who was or is a party, or
is threatened
to be made a party, to any threatened, pending or completed action or
suit by or in the right of the corporation, to procure a judgment in
its favor by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise against expenses including amounts paid in settlement and
attorneys', fees actually and reasonably incurred by him in connection
with the defense or settlement of the action or suit, if he acted in
good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the corporation. Indemnification may
not be made for any claim, issue or matter as to which such a person
has been adjudged by a court of competent jurisdiction, after
exhaustion of all appeals there from, to be liable to the corporation
or for amounts paid in settlement to the corporation, unless and only
to the extent that the court in which the action or suit was brought or
other court of competent Jurisdiction determines upon application that
in view of all the circumstances of the case the person is fairly and
reasonably entitled to indemnity for such expenses as the court deems
proper.
(c) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense
of any action, suit or proceeding referred to in subsections (a) and
(b) of this Article, or in defense of any claim, issue or matter
therein, he must be indemnified by the corporation against expenses,
including attorney's fees, actually and reasonably incurred by him in
connection with the defense,
(d) Any indemnification under subsections (a) and (b) unless ordered by a
court or advanced pursuant to subsection (e), must be made by the
corporation only as authorized in the specific case upon a
6
determination that indemnification of the director, officer,
employee or agent is proper in the circumstances. The determination
must be made:
(i) By the stockholders;
(ii) By the board of directors by majority vote of a quorum consisting
of directors who were not parties to the act, suit or proceeding;
(iii) if a majority vote of a quorum consisting of directors who were
not parties to the act, suit or proceeding so orders, by
independent legal counsel in a
written opinion; or
(iv) if a quorum consisting of directors who were not parties to the
act, suit or proceeding cannot be obtained, by independent legal
counsel in a written opinion.
(e) Expenses of officers and directors incurred in defending a civil or
criminal action, suit or proceeding must be paid by the corporation as
they are incurred and in advance of the final disposition of the
action, suit or proceeding, upon receipt of an undertaking by or on
behalf of the director or officer to repay the amount if it is
ultimately determined by a court of competent jurisdiction that he is
not entitled to be indemnified by the corporation. The provisions of
this subsection do not affect any rights to advancement of expenses to
which corporate personnel other than directors or officers may be
entitled under any contract or otherwise by law.
(f) The indemnification and advancement of expenses authorized in or
ordered by a court pursuant to this section:
(i) Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under
the certificate or articles of incorporation or any bylaw,
agreement, vote of stockholders or disinterested directors or
otherwise, for either an action in his official capacity or an
action in another capacity while holding his office, except that
Indemnification, unless ordered by a court pursuant to subsection
(b) or for the advancement of expenses made pursuant to
subsection (e) may not be made to or on behalf of any director or
officer if a final adjudication establishes that his acts or
omissions
7
involved intentional misconduct, fraud or a knowing violation of
the law and was material to the cause of action.
(ii) Continues for a person who has ceased to be a director, officer,
employee or agent and inures to the benefit of the heirs,
executors and administrators of such a person,
ARTICLE XI PLACE OF MEETING; CORPORATE BOOKS:
Subject to the laws of the State of Nevada, the shareholders and the
Directors shall have power to hold their meetings, and the Directors
shall have power to have an office or offices and to maintain the books
of the Corporation outside the State of Nevada, at such place or places
as may from time to time be designated in the by-laws or by appropriate
resolution.
ARTICLE XIII AMENDMENT OF ARTICLES:
The provisions of these Articles of Incorporation may be amended,
altered or repealed from time to time to the extent and in the manner
prescribed by the laws of the State of Nevada, and additional
provisions authorized by such laws as are then in force may be added.
All rights herein conferred on the directors, officers and shareholders
are granted subject to this reservation.
ARTICLE XIII INCORPORATOR:
The name and address of the sole incorporator signing these Articles of
Incorporation is as follows:
NAME ADDRESS
/s/ David Wages 500 W.College Parkway #V386
Carson City, NV 89706
IN WITNESS WHEREOF, the undersigned incorporator has executed these Articles of
Incorporation this 18th day of December, 1998.
/s/ David Wages
STATE OF NEVADA
Lyon County
On 12-18, 1998, personally appeared before me, a Notary Public, David Wages,
who acknowledged to me that he executed the foregoing Articles of
Incorporation for Codatech Corp., a Nevada corporation.
BEVERLY THOMPSON /s/ Beverly Thompson
NOTARY PUBLIC - NEVADA Notary Public
APPT Recorded in LYON CO.
My Appt. EXP. March 1, 2002
BY-LAWS OF
ROYSTON MANNOR ESTATES, INC.
ARTICLE I
SHAREHOLDERS
Section 1.01 Annual Meeting
The annual meeting of the shareholders shall be held at such date and time as
shall be designated by the board of directors and stated in the notice of the
meeting or in a duly executed waiver of notice thereof. If the corporation
shall fail to provide notice of the annual meeting of the shareholders as set
forth above, the annual meeting of the shareholders of the corporation shall
be held during the month of November or December of each year as determined
by the Board of Directors, for the purpose of electing, directors of the
corporation to serve during the ensuing year and for the transaction of such
other business as may properly come before the meeting. If the election of
the directors is not held on the day designated herein for any annual
meeting, of the shareholders, or at any adjournment thereof, the president
shall cause the election to be held at a special meeting of the shareholders
as soon thereafter as is convenient.
Section 1.02 Special Meetings.
Special meetings of the shareholders may be called by the president or the
Board of Directors and shall be called by the president at the written
request of the holders of not less than 51 % of the issued and outstanding
shares of capital stock of the corporation.
All business lawfully to be transacted by the shareholders may be transacted
at any special meeting at any adjournment thereof However, no business shall
be acted upon at a special meeting, except that referred to in the notice
calling the meeting, unless all of the outstanding capital stock of the
corporation is represented either in person or by proxy. Where all of the
capital stock is represented, any lawful business may be transacted and the
meeting shall be valid for all purposes.
Section 1.03 Place of Meetings.
Any meeting, of the shareholders of the corporation may be held at its
principal office in the State of Nevada or such other place in or out of the
United States as the Board of Directors may designate. A waiver of notice
signed by the shareholders entitled to vote may designate any place for the
holding of such meeting,
Section 1.04 Notice of Meetings.
(a) The secretary shall sign and deliver to all shareholders of record
written or printed notice of any meeting at least ten (10) days, but not more
than sixty (60) days, before the date of such meeting; which notice shall
state the place, date and time of the meeting, the general nature of the
business to be transacted, and, in the case of any meeting at which directors
are to be elected, the names of nominees, if any, to be presented for election.
(b) In the case of any meeting, any proper business may be presented
for action, except that the following items shall be valid only if the
general nature of the proposal is stated in the notice or written waiver of
notice:
(1) Action with respect to any contract or transaction between the corporation
and one or more of its directors or another firm, association, or corporation
in which one or more of its directors has a material financial interest;
(2) Adoption of amendments to the Articles of Incorporation; or
(3)Action with respect to the merger, consolidation, reorganization, partial or
complete liquidation, or dissolution of the corporation.
(c) The notice shall be personally delivered or mailed by first class mail to
each shareholder of record at the last known address thereof, as the same
appears on the books of the corporation, and the giving of such notice shall
be deemed delivered the date the same is deposited in the United States mail,
postage prepaid. If the address of any shareholder does not appear upon the
books of the corporation, it will be sufficient to address any notice to such
shareholder at the principal office of the corporation.
(d) The written certificate of the person calling any meeting, duly sworn,
setting forth the substance of the notice, the time and place the notice was
mailed or personally delivered to the several shareholders, and the addresses
to which the notice was mailed shall be prima facie evidence of the manner
and fact of giving such notice.
Section 1.05 Waiver of Notice.
If all of the shareholders of the corporation shall waive notice of a
meeting, no notice shall be required, and, whenever all of the shareholders
shall meet in person or by proxy, such meeting shall be valid for all
purposes without call or notice, and at such meeting any corporate action may
be taken.
Section 1.06 Determination of Shareholders of Record
(a) The Board of Directors may at any time fix a future date as a record
date for the determination of the shareholders entitled to notice of any
meeting or to vote or entitled to receive payment of any dividend or other
distribution or allotment of any rights or entitled to exercise any rights in
respect of any other lawful action. The record date so fixed shall not be
more than sixty (60) days prior to the date of such meeting nor more than
sixty (60) days prior to any other action. When a record date is so fixed,
only shareholders of record on that date are entitled to notice of and to vote
at the meeting or to receive the dividend, distribution or allotment of
rights, or to exercise their rights, as the case may be, notwithstanding any
transfer of any shares on the books of the corporation after the record date.
(b) If no record date is fixed by the Board of Directors, then (1) the record
date for determining shareholders entitled to notice of or to vote at a
meeting of shareholders shall be at the close of business on the business day
next preceding the day on which notice is given or, if notice is waived, at
the close of business on the day next preceding the day on which the meeting
is held; (2) the record date for determining shareholders entitled to give
consent to corporate action in writing without a meeting, when no prior
action by the Board of Directors is necessary, shall be the day on which
written consent is given, and (3) the record date for determining,
shareholders for any other purpose shall be at the close of business on the
day on which the Board of Directors adopts the resolution relating thereto,
or the sixtieth (60th) day prior to the date of such other action, whichever
is later.
Section 1.07 Quorum: Adjourned Meeting
(a)At any meeting of the shareholders, a majority of the issued and outstanding
shares of the corporation represented in person or by proxy, shall
constitute a quorum.
(b) If less than a majority of the issued and outstanding shares are
represented, a majority of shares so represented may adjourn from time to
time at the meeting, until holders of the amount of stock required to
constitute a quorum shall. be in attendance. At any such adjourned meeting at
which a quorum shall be present, any business may be transacted which might
have been transacted as originally called. When a shareholders' meeting is
adjourned to another time or place, notice need not be given of the adjourned
meeting if the time and place thereof are announced at the meeting at which the
adjournment is taken, unless the adjournment is for more than ten (10) days
in which event notice thereof shall be given.
Section 1.08 Voting
(a) Each shareholder of record, such shareholders duly authorized proxy or
attorney-in-fact shall be entitled to one (1) vote for each share of stock
standing registered in such shareholder's name on the books of the
corporation on the record date.
(b) Except as otherwise provided herein, all votes with respect to shares
standing, in the name of an individual on the record date (included pledged
shares) shall be cast only by that individual or such individuals duly
authorized proxy or attorney-in-fact. With respect to shares held by a
representative of the estate of a deceased shareholder, guardian,
conservator, custodian or trustee, votes may be cast by such holder upon
proof of capacity, even though the shares do not stand in the name of such
holder. In the case of shares under the control of a receiver, the receiver
may cast votes carried by such shares even though the shares do not stand in
the name of the receiver provided that the order of the court of competent
jurisdiction which appoints the receiver contains the authority to cast votes
carried by such shares. If shares stand in the name of a minor, votes may be
cast only by the duly-appointed guardian of the estate of such minor if such
guardian has provided the corporation with written notice and proof of such
appointment
(C) With respect to shares standing in the name of a corporation on the record
date, votes may be cast by such officer or agents as the by-laws of such
corporation prescribe or, in the absence of an applicable by-law provision,
by such person as may be appointed by resolution of the Board of Directors of
such corporation. In the event no person is so appointed, such votes of the
corporation may be cast by any person (including the officer making the
authorization) authorized to do so by the Chairman of the Board of Directors,
President or any Vice President of such corporation.
(d) Notwithstanding anything to the contrary herein contained, no votes may
be cast by shares owned by this corporation or its subsidiaries, if any. If
shares are held by this corporation or its subsidiaries, if any, in a
fiduciary capacity, no votes shall be cast with respect thereto on any matter
except to the extent that the beneficial owner thereof possesses and
exercises either a right to vote or to give the corporation holding the same
binding instructions on how to vote.
(e) With respect to shares standing in the name of two or more persons, whether
fiduciaries, members of a partnership, joint tenants, tenants in common,
husband and wife as community property, tenants by the entirety, voting
trustees, persons entitled to vote under a shareholder voting agreement or
otherwise and shares held by two or more persons (including proxy holders)
having the same fiduciary relationship respect in the same shares, votes may
be cast in the following manner:
(1) If only one such person votes, the votes of such person binds all.
(2) If more than one person casts votes, the act of the majority so voting
binds all.
(3) If more than one person casts votes, but the vote is evenly split on a
particular matter, the votes shall be deemed cast proportionately as
split.
(f) Any holder of shares entitled to vote on any matter may cast a portion of
the votes in favor of such matter and refrain from casting the remaining,
votes or cast the same against the proposal, except in the case of elections
of directors. if such holder entitled to vote fails to specify the number of
affirmative votes, it will be conclusively presumed that the holder is
casting affirmative votes with respect to all shares held.
(g) If a quorum is present, the affirmative vote of holders of a majority of
the shares represented at the meeting and entitled to vote on any matter
shall be the act of the shareholders, unless a vote of greater number or
voting by classes is required by the laws of the State of Nevada, the
Articles of Incorporation and these By-Laws.
Section 1.09 Proxies.
At any meeting of shareholders, any holder of shares entitled to vote may
authorize another person or persons to vote by proxy with respect to the
shares held by an instrument in writing and subscribed to by the holder of
such shares entitled to vote. No proxy shall be valid after the expiration of
six (6) months from the date of execution thereof, unless coupled with an
interest or unless otherwise specified in the proxy. In no event shall the
term of a proxy exceed seven (7) years from the date of its execution. Every
proxy shall continue in full force and effect until its expiration or
revocation. Revocation may be effected by filing an instrument revoking the
same or a duly-executed proxy bearing a later date with the secretary of the
corporation.
Section 1. 10 Order of Business.
At the annual shareholders meeting, the regular order of business shall be
as follows:
(1) Determination of shareholders present and existence of quorum;
(2) Reading and approval of the minutes of the previous meeting or
meetings;
(3) Reports of the Board of Directors, the president treasurer and secretary
of the
corporation, in the order named;
(4) Reports of committee;
(5) Election of directors;
(6) Unfinished business;
(7) New business;
(8) Adjournment.
Section 1. 11 Absentees Consent to Meetings
Transactions of any meeting of the shareholders are as valid as though had
at a meeting duly-held after regular call and notice if a quorum is present,
either in person or by proxy, and if, either before or after the meeting,
each of the persons entitled to vote, not present in person or by proxy (and
those who, although present, either object at the beginning of the meeting to
the transaction of any business because the meeting has not been lawfully
called or convened or expressly object at the meeting to the consideration of
matters not included in the notice which are legally required to be included
therein), signs a written waiver of notice and/or consent to the holding of the
meeting or an approval of the minutes thereof All such waivers, consents, and
approvals shall be filed with the corporate records and made a part of the
minutes of the meeting, Attendance of a person at a meeting shall constitute
a waiver of notice of such meeting, except when the person objects at the
beginning of the meeting to the transaction of any business because the
meeting is not lawfully called or convened and except that attendance at a
meeting is not a waiver of any right to object to the consideration of
matters not included in the notice if such objection is expressly made at the
beginning. Neither the business to be transacted at nor the purpose of any
regular or special meeting of shareholders need be specified in any written
waiver of notice, except as otherwise provided in Section 1.04(b) of these
By-Laws.
Section 1. 12 Action Without meeting
Any action which may be taken by the vote of the shareholders at a meeting
may be taken without a meeting if consented to by the holders of a majority
of the shares entitled to vote or such greater proportion as may be required
by the laws of the State of Nevada, the Articles of Incorporation, or these
By-Laws. Whenever action is taken by written consent, a meeting of
shareholders needs not be called or noticed.
ARTICLE II
DIRECTORS
Section 2.01 Number, Tenure and Qualification.
Except as otherwise provided herein, the Board of Directors of the
corporation shall consist of at least one (1) but no more than nine (9)
persons, who shall be elected at the annual meeting of the shareholders of
the corporation and who shall hold office for one (1) year or until their
successors are elected and qualify.
Section 2.02 Resignation
Any director may resign effective upon giving written notice to the chairman
of the Board of Directors, the president, or the secretary of the
corporation, unless the notice specifies a later time for effectiveness of
such resignation. If the Board of Directors accepts the resignation of a
director tendered to take effect at a future date, the Board or the
shareholders may elect a successor to take office when the resignation becomes
effective.
Section 2.03 ) Reduction in Number.
No reduction of the number of directors shall have the effect of removing
any director prior to the expiration of his term of office.
Section 2.04 Removal.
(a) The Board of Directors or the shareholders of the corporation, by a
majority vote, may declare vacant the office of a director who has been
declared incompetent by an order of a court of competent jurisdiction or
convicted of a felony.
Section 2.05 Vacancies.
(a) A vacancy in the Board of Directors because of death, resignation, removal,
change in number of directors, or otherwise may be filled by the shareholders
at any regular or special meeting or any adjourned meeting thereof or the
remaining director(s) by the affirmative vote of a majority thereof. A Board
of Directors consisting of less than the maximum number authorized in Section
2. 01 of ARTICLE 1I constitutes vacancies on the Board of Directors for
purposes of, this paragraph and may be filled as set forth above including by
the election of a majority of the remaining directors. Each successor so
elected shall hold office until the next annual meeting of shareholders or
until a successor shall have been duly-elected and qualified.
(b) If, after the filling of any vacancy by the directors, the directors then
in office who have been elected by the shareholders shall constitute less
than a majority of the directors then in office, any holder or holders of an
aggregate of five percent (51/4) or more of the total number of shares
entitled to vote may call a special meeting of shareholders to be held to
elect the entire Board of Directors. The term of office of any director shall
terminate upon such election of a successor.
Section 2.06 Regular Meetings
Immediately following the adjournment of, and at the same place as, the annual
meeting of the shareholders, the Board of Directors, including directors
newly elected, shall hold its annual meeting without notice, other than this
provision, to elect officers of the corporation and to transact such further
business as may be necessary or appropriate The Board of Directors may
provide by resolution the place, date and hour for holding additional regular
meetings.
Section 2.07 Special Meetings.
Special meetings of the Board of Directors may be called by the chairman and
shall be called by the chairman upon the request of any two (2) directors or
the president of the corporation.
Section 2.08 Place of Meeting
Any meeting of the directors of the corporation may be held at its principal
office in the State of Nevada, or at such other place in or out of the United
States as the Board of Directors may designate. A waiver or notice signed by
the directors may designate any place for the holding of such meeting.
Section 2.09 Notice of Meeting.
Except as otherwise provided in Section 2.06, the chairman shall deliver to all
directors written or printed notice of any special meeting, at least three
(3) days before the date of such meeting, by delivery of such notice
personally or mailing such notice first class mail, or by telegram If mailed,
the notice shall be deemed delivered two (2) business days following the date
the same is deposited in the United States mail, postage prepaid Any director
may waive notice of any meeting, and the attendance of a director at a
meeting shall constitute a waiver of notice of such meeting, unless such
attendance is for the express purpose of objecting to the transaction of
business threat because the meeting is not properly called or convened.
Section 2. 10 Quorum,:Adjourned Meetings
(a) A majority of the Board of Directors in office shall constitute a quorum.
(b) At any meeting of the Board of Directors where a quorum is not present, a
majority of those present may adjourn, from time to time, until a quorum is
present, and no notice of such adjournment shall be required At any adjourned
meeting where a quorum is present, any business may be transacted which could
have been transacted at the meeting originally called.
Section 2.11 Action Without Meeting
Any action required or permitted to be taken at any meeting of the Board of
Directors or any committee thereof may be taken without a meeting if a
written consent thereto is signed by all of the members of the Board of
Directors or of such committee. Such written consent or consents shall be
filed with the minutes of the proceedings of the Board of Directors or
committee. Such action by written consent shall have the same force and
effect as the unanimous vote of the Board of Directors or committee.
Section 2.12 Telephonic Meetings .
Meetings of the Board of Directors may be held through the use of a conference
telephone or similar communications equipment so long as all members
participating in such meeting can hear one another at the time of such
meeting, Participation in such a meeting constitutes presence in person at
such meeting.
Section 2.13 Board Decisions.
The affirmative vote of a majority of the, directors present at a meeting at
which a quorum is present shall be the act of the Board of Directors.
Section 2.14 Powers and Duties.
(a)Except as otherwise provided in the Articles of Incorporation or the laws of
the State of Nevada, the Board of Directors is invested with the complete and
unrestrained authority to manage the affairs of the corporation, and is
authorized to exercise for such purpose as the general agent of the
corporation, its entire corporate authority in such manner as it sees fit.
The Board of Directors may delegate any of its authority to menace, control
or conduct the current business of the corporation to any standing or special
committee or to any officer or agent and to appoint any persons to be agents
of the corporation with such powers, including the power to sub-delegate, and
upon such terms as may be deemed fit.
(b) The Board of Directors shall present to the shareholders at annual meetings
of the shareholders, and when called for by a majority vote of the
shareholders at a special meeting of the shareholders, a full and clear
statement of the condition of the corporation, and shall, at request, furnish
each of the shareholders with a true copy thereof.
(c) The Board of Directors, in its discretion, may submit any contract or act
for approval or ratification at any annual meeting of the shareholders or any
special meeting, properly called for the purpose of considering any such
contract or act, provided a quorum is present, The contract or act shall be
valid and binding upon the corporation and upon all the shareholders thereof,
if approved and ratified by the affirmative vote of a majority of the
shareholders at such meeting,
(d) In furtherance and not in limitation of the powers conferred by the laws of
the State of Nevada, the Board of Directors is expressly authorized and
empowered to issue stock of the Corporation for money, property, services
rendered, labor performed, cash advanced, acquisitions for other corporations
or for any other assets of value in accordance with the action of the Board
of Directors without vote or consent of the shareholders and the judgment of
the Board of Directors as to the value received and in return therefore shall
be conclusive and said stock, when issued, shall be fully-paid and
non-assessable.
Section 2.15 Compensation.
The directors shall be allowed and paid all necessary expenses incurred in
attending any meetings of the Board.
Section 2.16 Board Officers.
(a) At its annual meeting, the Board of Directors shall elect, from among its
members, a chairman to preside at the meetings of the Board of Directors. The
Board of Directors may also elect such other board officers and for such term
as it may, from time to time, determine advisable.
(b) Any vacancy in any board office because of death, resignation, removal or
otherwise may be filled by the Board of Directors for the unexpired portion
of the term of such office.
Section 2.17 Order of Business. The order of business at any meeting, of the
Board of Directors shall be as follows:
(1) Determination of members present and existence of quorum;
(2) Reading- and approval of the minutes of any previous meeting or
meetings;
(3) Reports of officers and committeemen;
(4) Election of officers;
(5) Unfinished business;
(6) New business;
(7) Adjournment.
ARTICLE 1111
OFFICERS
Section 3. 01 Election.
The Board of Directors, at its first meeting following the annual meeting of
shareholders, shall elect a president, a secretary and a treasurer to hold
office for one (1) year next coming and until their successors are elected
and qualify. Any person may hold two or more offices. The Board of Directors
may, from time to time, by resolution, appoint one or more vice presidents,
assistant secretaries, assistant treasurers and transfer agents of the
corporation as it may deem advisable; prescribe their duties; and fix their
compensation.
Section 3.02 Removal; Resignation
Any officer or agent elected or appointed by the Board of Directors may be
removed by it whenever, in its judgment the best interest of the corporation
would be served thereby. Any officer may resign at any time upon written
notice to the corporation without prejudice to the rights, if any, of the
corporation under any contract to which the resigning officer is a party.
Section 3.03 Vacancies.
Any vacancy in any office because of death, resignation, removal, or
otherwise may be filled by the Board of Directors for the unexpired portion
of the term of such office.
Section 3.04 President
The president shall be the general manager and executive officer of the
corporation, subject to the supervision and control of the Board of
Directors, and shall direct the corporate affairs, with full power to execute
all resolutions and orders of the Board of Directors not especially entrusted
to some other officer of the corporation. The president shall preside at all
meetings of the shareholders and shall sign the certificates of stock issued
by the corporation, and shall perform such other duties as shall be
prescribed by the Board of Directors.
Unless otherwise ordered by the Board of Directors, the president shall have
full power and authority on behalf of the corporation to attend and to act
and to vote at any meetings of the shareholders of any corporation in which
the corporation may hold stock and, at any such meetings,, shall possess and
may exercise any and all rights and powers incident to the ownership of such
stock The Board of Directors, by resolution from time to time, may confer
like powers on any person or persons in place of the president to represent
the corporation for these purposes.
Section 3.05 Vice President.
The Board of Directors may elect one or more vice presidents who shall be
vested with all the powers and perform all the duties of the president
whenever the president is absent or unable to act, including the signing of
the certificates of stock issued by the corporation, and the vice president
shall perform such other duties as shall be prescribed by the Board of
Directors.
Section 3.06 Secretary.
The secretary shall keep the minutes of all meetings of the shareholders and
the Board of Directors in books provided for that purpose. The secretary
shall attend to the giving and service of all notices of the corporation, may
sign with the president in the name of the corporation all contracts
authorized by the Board of Directors or appropriate committee, shall have the
custody of the corporate seal, shall affix the corporate seal to all
certificates of stock duly issued by the corporation, shall have charge of
stock certificate books, transfer books and stock ledgers, and such other
books and papers as the Board of Directors or appropriate committee may
direct, and shall, in general perform all duties incident to the office of
the secretary. All corporate books kept by the secretary shall be open for
examination by any director at any reasonable time.
Section 3.07 Assistant Secretary
The Board of Directors may appoint an assistant secretary who shall
have such powers and perform such duties as may be prescribed for him by the
secretary of the corporation or by the Board of Directors.
Section 3.08 Treasurer.
The treasurer shall be the chief financial officer of the
corporation, subject to the supervision and control of the Board of
Directors, and shall have custody of all the funds and securities of the
corporation. When necessary or proper, the treasurer shall endorse on behalf
of the corporation for collection checks, notes and other obligations, and
shall deposit all monies to the credit of the corporation in such bank or
banks or other depository as the Board of Directors may designate, and shall
sign all receipts and vouchers for payments made by the corporation. Unless
otherwise specified by the Board of Directors, the treasurer shall sign with
the president all bills of exchange and promissory notes of the corporation,
shall also have the care and custody of the stocks, bonds, certificates,
vouchers, evidence of debts, securities and such other property belonging to
the corporation as the Board of Directors shall designate, and shall sign all
papers required by law, by these By-laws or by the Board of Directors to be
signed by the treasurer. The treasurer shall enter regularly in the books of
the corporation, to be kept for that purpose, full and accurate accounts of
all monies received and paid on account of the corporation and whenever
required by the Board of Directors, the treasurer shall render a statement of
any or all accounts. The treasurer shall at all reasonable times exhibit the
books of account to any directors of the corporation and shall perform all
acts incident to the position of treasurer subject to the control of the
Board of Directors. The treasurer shall, if required by the Board of
Directors, give a bond to the corporation in such sum and with such security
as shall be approved by the Board of Directors for the faithful performance
of all the duties of the treasurer and for restoration to the corporation in
the event of the treasurer's death, resignation, retirement, or removal from
office, of all books, records, papers, vouchers, money and other property
belonging to the corporation. The expense of such bond shall be borne by the
corporation.
Section 3.09 Assistant Treasurer.
The Board of Directors may appoint an assistant treasurer who shall
have such powers and perform such duties as may be prescribed by the
treasurer of the corporation or by the Board of Directors, and the Board of
Directors may require the assistant treasurer to give a bond to the
corporation in such sum and with such security as it may approve, for the
faithful performance of the duties of assistant treasurer, and for the
restoration to the corporation, in the event of the assistant treasurer's
death, resignation, retirement or removal from office, of all books, records,
papers, vouchers, money and other property belonging to the corporation. The
expense of such bond shall be borne by the corporation.
ARTICLE IV
CAPITAL STOCK
Section 4.01 Issuance .
Shares of capital stock of the corporation shall be issued in such manner
and at such times and upon such conditions as shall be prescribed by the
Board of Directors.
Section 4.02 Certificates.
Ownership in the corporation shall be evidenced by certificates for shares
of stock in such form as shall be prescribed by the Board of Directors, shall
be under the seal of the corporation and shall be signed by the president or
the vice president and also by the secretary or an assistant secretary. Each
certificate shall contain the name of the record holder, the number,
designation, if any, class or series of shares represented, a statement of
summary of any applicable rights, preferences, privileges, or restrictions
thereon, and a statement that the shares are assessable, if applicable. All
certificates shall be consecutively numbered. The name and address of the
shareholder, the number of shares, and the date of issue shall be entered on
the stock transfer books of the corporation.
Section 4.03 Surrender: Lost or Destroyed Certificates.
All certificates surrendered to the corporation, except those representing
shares of treasury stock, shall be canceled and no new certificates shall be
issued until the former certificate for a like number of shares shall have
been canceled, except that in case of a lost, stolen, destroyed or mutilated
certificate, a new one may be issued therefor. However, any shareholder
applying for the issuance of a stock certificate in lieu of one alleged to
have been lost, stolen, destroyed or mutilated shall, prior to the issuance
of a replacement, provide the corporation with his, her or its affidavit of
the facts surrounding the loss, theft, destruction or mutilation and an
indemnity bond in an amount and upon such terms as the treasurer, or the
Board of Directors, shall require. In no case shall the bond be in amount
less than twice the current market value of the stock and it shall indemn
the corporation against any loss, damage, cost or inconvenience arising as a
consequence of the issuance of a replacement certificate.
Section 4.04 Replacement Certificate.
When the Articles of Incorporation are amended in any way affecting, the
statements contained in the certificates for outstanding shares of capital
stock of the corporation or it becomes desirable for any reason, including,
without limitation, the merger or consolidation of the corporation with
another corporation or the reorganization of the corporation, to cancel any
outstanding certificate for shares and issue a new certificate therefor
conforming to the rights of the holder, the Board of Directors may order any
holders of outstanding certificates for shares to surrender and exchange the
same for new certificates within a reasonable time to be fixed by the Board
of Directors. The order may provide that a holder of any certificate(s)
ordered to be surrendered shall not be entitled to vote, receive dividends or
exercise any other rights of shareholders until the holder has complied with
the order provided that such order operates to suspend such rights only after
notice and until compliance.
Section 4.05 Transfer of Shares.
No transfer of stock shall be valid as against the corporation except on
surrender and cancellation by the certificate therefor, accompanied by an
assignment or transfer by the registered owner made either in person or under
assignment. Whenever any transfer shall be expressly made for collateral
security and not absolutely, the collateral nature of the transfer shall be
reflected in the entry of transfer on the books of the corporation.
Section 4.06 Transfer Agent
The Board of Directors may appoint one or more transfer agents and
registrars of transfer and may require all certificates for shares of stock
to bear the signature of such transfer agent and such registrar of transfer.
Section 4.07 Stock Transfer Books.
The stock transfer books shall be closed for a period of ten (10) days
prior to all meetings of the shareholders and shall be closed for the
payment of dividends as provided in Article V hereof and during such periods
as, from time to time, may be fixed by the Board of Directors, and, during
such periods, no stock shall be transferable.
Section 4.08 Miscellaneous .
The Board of Directors shall have the power and authority to make such rules
and regulations not inconsistent herewith as it may deem expedient concerning
the issue, transfer and registration of certificates for shares of the
capital stock of the corporation.
ARTICLE V
DIVIDENDS
Section 5.01
Dividends may be declared, subject to the provisions of the laws of the
State of Nevada and the Articles of Incorporation, by the Board of Directors
at any regular or special meeting and may be paid in cash, property, shares
of corporate stock, or any other medium. The Board of Directors may fix in
advance a record date, as provided in Section 1.06 of these By4aws, prior to
the dividend payment for the purpose of determining shareholders entitled to
receive payment of any dividend The Board of Directors may close the stock
transfer books for such purpose for a period of not more than ten (10) days
prior to the payment date of such dividend.
ARTICLE VI
OFFICES; RECORDS; REPORTS; SEAL AND FINANCIAL MATTERS
Section 6.01 Principal Office.
The principal office of the corporation in the State of Nevada Shall be as
designated by the Board of Directors and so filed with the State of Nevada,
and the corporation may also have an office in any other state or territory
as the Board of Directors may designate.
Section 6.02 Records.
The stock transfer books and a certified copy of the By4aws, Articles of
Incorporation, any amendments thereto, and the minutes of the proceedings of
the shareholders, the Board of Directors, and committees of the Board of
Directors shall be kept at the principal office of the corporation for the
inspection of all who have the right to see the same and for the transfer of
stock. All other books of the corporation shall be kept at such places as may
be prescribed by the Board of Directors.
Section 6.03 Financial RQ9rt on Request.
Any shareholder or shareholders holding at least five percent (5%) of the
outstanding shares of any class of stock may make a written request for an
income statement of the corporation for the three (3) month, six (6) month,
or nine (9) month period of the current fiscal year ended more than thirty
(30) days prior to the date of the request and a balance sheet of the
corporation as of the end of such period In addition, if no annual report for
the last fiscal year has been sent to shareholders, such shareholder or
shareholders may make a request for a balance sheet as of the end of such
fiscal year and an income statement and statement of changes in financial
position for such fiscal year. The statement shall be delivered or mailed to
the person making the request within thirty (30) days thereafter. A copy of
the statements shall be kept on file in the principal office of the
corporation for twelve (12) months, and such copies shall be exhibited at all
reasonable times to any shareholder demanding an examination of them or a
copy shall be mailed to each shareholder. Upon request by any shareholder,
there shall be mailed to the shareholder a copy of the last annual semiannual
or quarterly income statement which it has prepared and a balance sheet as of
the end of the period. The financial statements referred to in this
Section 6.03 shall be accompanied by the report thereon, if any, of any
independent accountants engaged by the corporation or the certificate of an
authorized officer of the corporation that such financial statements were
prepared without audit from the books and records of the corporation.
Section 6.04 Right of Inspection.
(a) The accounting books and records and minutes of proceedings of the
shareholders and the Board of Directors and committees of the Board of
Directors shall be open to inspection upon the written demand of any
shareholder or holder of a voting trust certificate at any reasonable time
during usual business hours for a purpose reasonably related to such holder's
interest as a shareholder or as the holder of such voting trust certificate.
This right of inspection shall extend to the records of the subsidiaries, if
any, of the corporation. Such inspection may be made in person or by agent or
attorney, and the right of inspection includes the right to copy and make
extracts.
(b)Every director shall have the absolute right at any reasonable time to
inspectand copy all books, records and documents of every kind and to inspect
the physical properties of the corporation and/or its subsidiary
corporations. Such inspection may be made in person or by agent or attorney,
and the right of inspection includes the right to copy and make extracts.
Section 6.05 Corporate.
The Board of Directors may, by resolution, authorize a seal, and the
seal may be used by causing it or a facsimile, to be impressed or
affixed or reproduced or otherwise. Except when otherwise specifically
provided herein, any officer of the corporation shall have the
authority to affix the seal to any document requiring it
Section 6.06 Fiscal Year.
The fiscal year-end of the corporation shall be the calendar year or
such other term as may be fixed by resolution of the Board of
Directors.
Section 6.07 Reserve .
The Board of Directors may create, by resolution, out of the earned
surplus of the corporation such reserves as the directors may, from
time to time, in their discretion, think proper to provide for
contingencies, or to equalize dividends or to repair or maintain any
property of the corporation, or for such other purpose as the Board of
Directors may deem beneficial to the corporation, and the directors may
modify or abolish any such reserves in the manner in which they were
created.
ARTICLE II
INDEMNIFICATION
Section 7.01 Indemnification.
The corporation shall, unless prohibited by Nevada Law, indemnify
any person (an "Indemnitee") who is or was involved in any manner
(including, without limitation, as a party or a witness) or is
threatened to be so involved in any threatened, pending or completed
action suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative, including without limitation, any action,
suit or proceeding brought by or in the right of the corporation to
procure a judgement in its favor (collectively, a "Proceeding!') by
reason of the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan
or other entity or enterprise, against all Expenses and Liabilities
actually and reasonably incurred by him in connection with such
Proceeding. The right to indemnification conferred in this Article
shall be presumed to have been relied upon by the directors, officers,
employees and agents of the corporation and shall be enforceable as a
contract right and inure to the benefit of heirs, executors and
administrators of such individuals.
Section 7.02 Indemnification Contracts.
The Board of Directors is authorized on behalf of the corporation,
to enter into, deliver and perform agreements or other arrangements to
provide any indemnitee with specific rights of indemnification in
addition to the rights provided hereunder to the fullest extent
permitted by Nevada Law. Such agreements or arrangements may provide
(i) that the Expenses of officers and directors incurred in defending a
civil or criminal action, suit or proceeding, must be paid by the
corporation as they are incurred and in advance of the final
disposition of any such action, suit or proceeding provided that, if
required by Nevada Law at the time of such advance, the officer or
director provides an undertaking, to repay such amounts if it is
ultimately determined by a court of competent jurisdiction that such
individual is not entitled to be indemnified against such expenses,
(iii) that the Indemnitee shall be presumed to be entitled to
indemnification under this Article or such agreement or arrangement and
the corporation shall have the burden of proof to overcome that
presumption, (iii) for procedures to be followed by the corporation and
the Indemnitee in making any determination of entitlement to
indemnification or for appeals therefrom and (iv) for insurance or such
other Financial Arrangements described in Paragraph 7.02 of this
Article, all as may be deemed appropriate by the Board of Directors at
the time of execution of such agreement or arrangement.
Section 7.03 Insurance and Financial Arrangement
The corporation may, unless prohibited by Nevada Law, purchase and
maintain insurance or make other financial arrangements ("Financial
Arrangements") on behalf of any Indemnity for any liability asserted
against him and liability and expenses incurred by him in his capacity
as a director, officer, employee or agent, or arising out of his status
as such, whether or not the corporation has the authority to indemnify
him against such liability and expenses. Such other Financial
Arrangements may include (i) the creation of a trust fund, (ii) the
establishment of a program of self-insurance, (iii) the securing of the
corporation's obligation of indemnification by granting a security
interest or other lien on any assets of the corporation, or (iv) the
establishment of a letter of credit, guaranty or surety.
Section 7.04 Definitions.
For purposes of this Article: Expenses. The word "Expenses" shall be
broadly construed and, without limitation, means (i) all direct and
indirect costs incurred, paid or accrued, (ii) all attorneys' fees,
retainers, court costs, transcripts, fees of experts, witness fees,
travel expenses, food and- lodging, expenses while traveling,
duplicating costs, printing, and binding costs, telephone charges,
postage, delivery service, freight or other transportation fees and
expenses, (iii) all other disbursements and out-of-pocket expenses,
(iv) amounts paid in settlement, to the extent permitted by Nevada Law,
and (v) reasonable compensation for time spent by the Indemnitee for
which he is otherwise not compensated by the corporation or any third
party, actually and reasonably incurred in connection with either the
appearance at or investigation, defense, settlement or appeal of a
Proceeding or establishing or enforcing a right to indemnification
under any agreement 45r arrangement, this Article, the Nevada Law or
otherwise; provided, however, that "Expenses" shall not include any
judgments or fines or excise taxes or penalties imposed under the
Employee Retirement Income Security Act of 1974, as amended ("ERJSA")
or other excise taxes or penalties.
Liabilities. "Liabilities" means liabilities of any type
whatsoever, including, but not limited to, judgments or fines, ERISA
or other excise taxes and penalties, and amounts paid in settlement.
Nevada Law. 'Nevada Law," means Chapter 78 of the Nevada Revised
Statutes as amended and in effect from time to time or any successor
or other statutes of Nevada having, similar import and effect.
This Article. "This Article" means Paragraphs 7.01 through 7.04 of
these By-Laws or any portion of them.
Power of Stockholders. Paragraphs 7.01 through 7,04, including this
Paragraph, of these By-Laws may be amended by the stockholders only by
vote of the holders of sixty-six and two-thirds percent (66 2/3%) of
the entire number of shares of each class, voting separately, of the
outstanding capital stock of the corporation (even though the right of
any class to vote is otherwise restricted or denied), provided,
however, no amendment or repeal of this Article shall adversely affect
any right of any Indemnitee existing at the time such amendment or
repeal becomes effective.
Power of Directors. Paragraphs 7.01 through 7.04 and this Paragraph
of these By-Laws may be amended of repealed by the Board of Directors
only by vote of eighty percent (800%) of the total number of Directors
and the holders of sixty-six and two-thirds permit (66 2/3) of the
entire number of shares of each class, voting separately, of the
outstanding capital stock of the corporation (even though the right of
any class to vote is otherwise restricted or denied, provided, however,
no amendment or repeal of this Article shall adversely affect any right
of any Indemnitee existing, at the time such amendment or repeal
becomes effective.
ARTICLE VIH
BY-LAWS
Section 8.01 Amendment.
Amendments and changes of these By-Laws may be made at any regular
or special meeting of the Board of Directors by a vote of not less than
all of the entire Board, or may be made by a vote of, or a consent in
writing signed by the holders of a majority of the issued and
outstanding capital stock.
Section 8.02 Additional by-laws
Additional by-laws not inconsistent herewith may be adopted by the
Board of Directors at any meeting of the Board of Directors at which a
quorum is present by an affirmative vote of a majority of the directors
present or by the unanimous consent of the Board of Directors in
accordance with Section 2.11 of these By-laws.
CERTIFICATION
I, the undersigned, being the duly elected secretary of the
Corporation, do hereby certify that the foregoing By-laws were adopted
by the Board of Directors on the ___day of ________,19
/s/ John Royston
Secretary
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this registration statement
to be signed on its behalf by the undersigned, thereunto duly
authorized.
ROYSTON MANNOR ESTATES, INC., INC.
By:
Harvey Makaiwi, President
