UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF
1933 Montana Acquisition Corporation (Name of small business
issuer in its charter)
Delaware 6770 14-182-4753
(State or Jurisdiction (Primary Standard Industrial (I.R.S. Employer
of Incorporation or Classification Code Number) Identification No.)
Organization)
Montana Acquisition Corporation
241 Morner Road
Rensselaer, New York 12144
(518) 462-7879
(Address and telephone number of principal executive offices)
Montana Acquisition Corporation
241 Morner Road
Rensselaer, New York 12144
(Address of Principal place of business or intended principal place of business)
Whiteman Osterman & Hanna
One Commerce Plaza
Albany, New York 12260
(518) 487-7600
Matthew P. Hoff, Esq.
(Name, address, and telephone number of agent for service)
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after
the effective date of this Registration Statement and Prospectus.
We may amend this registration statement on such date or dates as may be
necessary to delay its effective date until we file a further amendment which
specifically states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of 1933 or until
the registration statement shall become effective on a date that the SEC, acting
pursuant to said Section 8(a), may determine.
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CALCULATION OF REGISTRATION FEE
Title of Each Class of Amount Proposed Proposed
Securities Being Being Maximum Maximum
Registered Registered Offering Price Aggregate
Per Share (1) Offering Price (1)
Shares of Common 10,000 $1.00 $10,000
Stock
TOTAL 10,000 $1.00 $10,000
(1) Estimated for purposes of computing the registration fee pursuant to
Rule 457.
Cross Reference Sheet Showing the
Location In Prospectus of Information
Required by Items of Form SB-2
Part I. Information Required in Prospectus
Item No. Required Item Location or Caption
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1. Front of Registration Statement Front of Registration
and Outside Front Cover of Statement and outside
Prospectus front cover of Prospectus
2. Inside Front and Outside Back Inside Front Cover Page
Cover Pages of Prospectus of Prospectus and Outside
Front cover Page of Prospectus
3. Summary Information and Risk Prospectus Summary;
Factors High Risk Factors
4. Use of Proceeds Use of Proceeds
5. Determination of Offering Prospectus Summary -
Price Determination of Offering
Price; High Risk Factors
6. Dilution Dilution
7. Selling Security Holders Not Applicable
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8. Plan of Distribution Plan of Distribution
9. Legal Proceedings Litigation
10. Directors, Executive Officers, Management
Promoters and Control Persons
11. Security Ownership of Certain Principal Stockholders
Beneficial Owners and Management of Common Stock
12. Description of Securities Description of Securities
13. Interest of Named Experts and Legal Opinions; Experts
Counsel
14. Disclosure of Commission Position Statement as to
on Indemnification Indemnification for
Securities Act Liabilities
15. Organization Within Last Management, Certain
Five Years Transactions
16. Description of Business Proposed Business,
Remuneration
17. Management's Discussion and Proposed Business -
and Analysis or Plan of Plan of Operation
18. Description of Property Proposed Business
19. Certain Relationships and Related Certain Transactions
Transactions
20. Market for Common Stock and Prospectus Summary,
Related Stockholder Matters Market for Registrant's
Common Stock and Related
Stockholders Matters;
Shares Eligible for Future
Sale.
21. Executive Compensation Remuneration
22. Financial Statements Financial Statements
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23. Changes in and Disagreements Not Applicable
with Accountants on Accounting
and Financial Disclosure
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PROSPECTUS
Montana Acquisition Corporation
(A Delaware Corporation)
10,000 Shares of Common Stock Offered at $1.00 per Share
Montana Acquisition Corporation is offering for sale 10,000 shares of $.001
par value common stock for $1.00 per share. We will sell the shares on a
"best-efforts" basis for a period of up to one hundred eighty days (180) days
and will not use a professional underwriter or securities dealer. This is a
"blank-check" offering being made in compliance with Rule 419 of Regulation C of
the Securities and Exchange Commission. Under this rule, the offering proceeds
and the securities to be issued to purchasers will be placed in an escrow
account until the offering has been reconfirmed by our shareholders and a
business combination or merger is consummated. Because the securities that we
are offering constitute "penny stock", certain sales restrictions apply to these
securities. (See "Risk Factors", p. ___). The sole officer, director and
shareholder of the company is Leslie M. Apple.
Investing in our common stock involves substantial risks. See "Risk
Factors" beginning on page _____. Neither the U.S. Securities and Exchange
Commission nor the securities commission of any state has approved or
disapproved these securities, nor have they passed upon the accuracy or adequacy
of this prospectus. Any representation to the contrary is a criminal offense.
Prior to this offering, there has been no public market for the common stock of
the company. There is no assurance that any trading market in these securities
will ever develop.
Underwriting Discounts Maximum Proceeds
Price to Public and Commissions to Issuer
Per Share $1.00 n/a $1.00
Total $1.00 n/a $10,000
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1. Proceeds to the issuer are shown before deducting offering expenses which
include: Blue Sky fees, legal fees, accounting fees, printing fees, filing
fees, estimated at $8,352.64.
2. We offer the securities for cash, payable when you subscribe. We will
manage the offering and sell the shares without any discounts or other
commissions.
3. After we receive investors' funds, we will immediately deposit them in an
escrow account which will be maintained by Whiteman Osterman & Hanna, One
Commerce Plaza, Albany, New York 12260. All investors' checks or money
orders must be made payable to "Whiteman Osterman & Hanna, as Escrow Agent
for Montana Acquisition Corporation."
4. The investors' funds will remain as deposited in the escrow account and may
not be traded or transferred, except that Federal regulations permit us to
withdraw up to 10% of the proceeds of the offering. We intend to ask the
escrow agent to release to us up to 10% of the proceeds of the offering.
We have filed a registration statement relating to these securities with
the Securities and Exchange Commission. The information in this prospectus is
not complete any may change. We will not sell these securities until the
registration statement is effective. This prospectus is not an offer to sell
these securities and it is not soliciting an offer to buy in any state when the
offer or sale is not permitted.
Montana Acquisition Corporation
241 Morner Road
Rensselaer, New York 12144
(518) 462-7879
The date of this Prospectus is November 3, 2000.
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TABLE OF CONTENTS
PROSPECTUS SUMMARY.............................................................1
The Company..................................................................1
The Offering ................................................................1
More About Rule 419 .........................................................2
Risk Factors ................................................................2
Determination of Offering Price .............................................2
Use of Proceeds .............................................................2
SUMMARY FINANCIAL INFORMATION..................................................3
INVESTORS' RIGHTS AND SUBSTANTIVE PROTECTION UNDER RULE 419....................3
Deposit of Offering Proceeds and Securities .................................3
Acquisition Criteria ........................................................4
Post-Effective Amendment ....................................................5
Reconfirmation Offering .....................................................5
Release of Securities and Funds .............................................6
HIGH RISK FACTORS..............................................................6
DILUTION......................................................................12
USE OF PROCEEDS...............................................................13
CAPITALIZATION................................................................15
PROPOSED BUSINESS.............................................................15
Business Combinations.......................................................19
Regulation..................................................................20
Employees...................................................................20
Facilities .................................................................20
MANAGEMENT....................................................................21
Biographies .............................................................21
Other Blank Check Companies ................................................21
Conflicts of Interest ......................................................21
Remuneration ...............................................................22
Management Involvement .....................................................22
Management Control .........................................................22
STATEMENT AS TO INDEMNIFICATION ..............................................22
MARKET FOR THE COMPANY'S COMMON STOCK ........................................23
PRINCIPAL STOCKHOLDERS........................................................24
DESCRIPTION OF SECURITIES.....................................................24
Common Stock ...............................................................24
Future Financing ...........................................................25
Reports to Stockholders ....................................................25
Dividends ..................................................................25
Transfer Agent .............................................................26
PLAN OF DISTRIBUTION..........................................................26
Method of Subscribing ......................................................27
EXPIRATION DATE...............................................................27
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LITIGATION....................................................................27
LEGAL OPINIONS................................................................27
EXPERTS.......................................................................28
FURTHER INFORMATION...........................................................28
FINANCIAL STATEMENTS..........................................................28
INFORMATION NOT REQUIRED IN PROSPECTUS........................................33
EXHIBITS .....................................................................36
UNDERTAKINGS .................................................................37
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PROSPECTUS SUMMARY
Montana Acquisition Corporation
241 Morner Road
Rensselaer, New York 12144
The following is a summary of certain information contained in this
Prospectus. Because this is a summary, it may not contain all the information
that you should consider before purchasing our common stock. You should read the
entire prospectus carefully.
The Company
Montana Acquisition Corporation was organized under the laws of the State
of Delaware on June 9, 2000. We are a development stage entity, and have neither
engaged in any operations nor generated any revenues to date.
The company was organized as a vehicle to acquire or merge with another
business or company. This type of company is referred to as a "blank check
company" as defined in Rule 419 of Regulation C under the Securities and
Exchange Act of 1933.
Management believes that the company's characteristics as an enterprise
with liquid assets, nominal liabilities, a registered class of securities and
flexibility in structuring will make the company an attractive combination
candidate.
We have not yet identified any specific business or company as acquisition
or merger target.
The company does not intend to engage in the business of investing,
reinvesting or trading in securities as its primary business or pursue any
business which would render the company an "investment company" pursuant to the
Investment Company Act of 1940. Montana Acquisition Corporation will be referred
to in this prospectus as "we," "us," "our," or "the company."
The Offering
Securities offered................................10,000 Shares of Common Stock,
$.001 par value, being
offered at $1.00 per Share.
(See "Description Securities".)
Shares of Common Stock outstanding prior to the offering..................25,000
Shares of Common Stock to be outstanding after the offering...............35,000
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More About Rule 419
Under Rule 419, investors have certain rights and will receive the
substantive protection provided by the Rule. The securities purchased by you and
other investors and the funds received in the offering will be deposited and
held in an escrow account until an acquisition meeting specific criteria is
completed. Before the acquisition can be completed and before the escrow funds
and securities can be released to the company and the investors, we will update
the registration statement with a post-effective amendment. This will give you
and other investors the details of the proposed acquisition or merger. You will
then have up to 45 days to reconfirm your investment (See "Your Rights Under
Rule 419").
Risk Factors
An investment in our common stock is highly speculative and involves a high
degree of risk. You should not purchase shares in the offering if you expect
short-term earnings or appreciation in the value of our company. (See "High Risk
Factors" and "Dilution.")
Determination of Offering Price
The offering price of $1.00 per share has been arbitrarily determined by
the company. This price bears no relation to our assets, book value, or any
other customary investment criteria, including our prior operating history.
Among factors we considered in determining the offering price were estimates of
the company's business potential, the limited financial resources of the
company, the amount of equity and control desired to be retained by the present
shareholders, the amount of dilution to public investors and the general
condition of the securities markets.
Use of Proceeds
If all of the shares are sold, then the gross proceeds of this offering
will be $10,000. Ten percent of this amount, or $1,000, may be released to the
company before you reconfirm your investment in accordance with Rule 419. The
balance of the proceeds, less approximately $8,300 in offering expenses, will be
used to defray the expense of a merger or acquisition.
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SUMMARY FINANCIAL INFORMATION
The following is a summary of our consolidated financial information. It is
derived from our audited financial statements appearing elsewhere in this
prospectus and should be read in conjunction with those statements. As the
company was incorporated on June 9, 2000 and the date of this prospectus is
November 3, 2000, the company's consolidated financial information is limited to
its balance sheet as of its date of incorporation.
Statement of Operations Data:
Net Revenues.................................................. $ -0-
Net Loss...................................................... $ -0-
Net Loss Per Share............................................ $ -0-
Shares Outstanding............................................ 25,000
As of July 18, 2000 Pro-Forma After
Offering
Balance Sheet Data:
Working Capital............................. $ 2,064 $12,064
Total Assets................................ $ 2,500 $12,500
Long Term Debt.............................. $ -0- $ -0-
Total Liabilities........................... $ -0- $ -0-
Shareholders' Deficit....................... $ -0- $ -0-
YOUR RIGHTS AND SUBSTANTIVE PROTECTION UNDER RULE 419
Deposit of Offering Proceeds and Securities
Rule 419 requires that offering proceeds after deduction for underwriting
commissions, underwriting expenses and dealer allowances, if any, and the
securities purchased by investors in this offering, be deposited into an escrow
or trust account. Under Rule 419, the escrowed funds and securities will be
released to the company and to the investors, only after the company has met the
following three basic conditions.
o First, we must execute an agreement for an acquisition meeting certain
prescribed criteria.
o Second, we must file a post-effective amendment to the Registration
Statement which gives you the opportunity to reconfirm your
investment. The post-effective
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amendment must also contain information regarding the acquisition
candidate and its business, including audited financial statements.
o Third, we must conduct the reconfirmation offer and satisfy all of the
prescribed conditions, including the condition that a certain minimum
number of investors must elect to remain investors.
After we submit a signed representation to the escrow agent that these
conditions 419 have been met and after the acquisition or merger is consummated,
the escrow agent can release the escrowed funds and securities.
Accordingly, the company has entered into an escrow agreement with Whiteman
Osterman & Hanna which provides that:
(1) The proceeds will be deposited into the escrow account promptly upon
receipt. Rule 419 permits 10% of the escrowed funds to be released to the
company before the reconfirmation offering. The escrowed funds and any dividends
or interest they earn, if any, are to be held for the sole benefit of the
investors and can only be invested in bank deposits, in money market mutual
funds or federal government securities or securities for which the principal or
interest is guaranteed by the federal government.
(2) All securities issued in connection with the offering and any other
securities issued with respect to such securities, including securities issued
with respect to stock splits, stock dividends or similar rights are to be
deposited directly into the escrow account promptly upon issuance. The identity
of the investor is to be included on any stock certificate or other document
evidencing the securities. The securities held in the escrow account will remain
as issued, and will be held for the sole benefit of the investors who retain the
voting rights, if any, with respect to the securities held in their names. The
securities held in the escrow account may not be transferred or disposed of, nor
may any interest be created in them other than by will or the laws of descent
and distribution, or pursuant to a qualified domestic relations order as defined
by the Internal Revenue Code of 1986, as amended, or Table 1 of the Employee
Retirement Income Security Act.
(3) Warrants, convertible securities or other derivative securities, if
any, relating to securities held in the escrow account may be exercised or
converted in accordance with their terms; provided that, however, the securities
received upon exercise or conversion together with any cash or other
consideration paid in connection with the exercise or conversion are to be
promptly deposited into the escrow account.
Acquisition Criteria
Rule 419 requires that before the funds and the securities in the escrow
account can be released, we must first execute an agreement to acquire an
acquisition candidate that meets certain specified criteria. The agreement must
provide for the acquisition of a business or assets whose fair value represents
at least 80% of the maximum proceeds of this offer. The agreement must include,
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as a precondition to closing, a requirement that the number of investors
representing 80% of the maximum offering proceeds must elect to reconfirm their
investment. For purposes of the offering, the fair value of the business or
assets to be acquired must be at least $8,000 (80% of $10,000).
Post-Effective Amendment
Once we execute the agreement to acquire or merge with a business that
meets the above criteria, we must update the registration statement with a
post-effective amendment. The post- effective amendment must contain information
about the proposed acquisition or merger candidate and its business, including
audited financial statements, the results of this offering and the use of the
funds disbursed from the escrow account. The post-effective amendment must also
include the terms of the reconfirmation offer required by Rule 419. The
reconfirmation offer must include certain prescribed conditions which must be
satisfied before the offering proceeds and securities can be released from
escrow.
Reconfirmation Offering
The reconfirmation offer must commence after the effective date of the
post-effective amendment. Under Rule 419, the terms of the reconfirmation offer
must include the following conditions:
(1) The prospectus contained in the post-effective amendment will be sent
to each investor whose securities are held in the escrow account within 5
business days after the effective date of the post-effective amendment.
(2) Each investor will have no fewer than 20 and no more than 45 business
days from the effective date of the post-effective amendment to notify us in
writing that the investor elects to remain an investor.
(3) If the company does not receive written notification from any investor
within 45 business days following the effective date, the pro rata portion of
the funds (and any related interest or dividends) held in the escrow account on
the investor's behalf will be returned to the investor within 5 business days by
first class mail or other equally prompt means.
(4) The acquisition or merger will be consummated only if investors
representing 80% of the maximum offering proceeds ($8,000) elect to reconfirm
their investment.
(5) If we have not consummated an acquisition or merger by _________, 2002
(18 months from the date of this prospectus), the funds held in the escrow
account shall be returned to all investors on a pro rata basis within 5 business
days by first class mail or other equally prompt means.
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Release of Securities and Funds
The funds will be released to us, and the securities will be released to
you and other investors after the escrow agent has received a signed
representation from the company and any other evidence acceptable by the escrow
agent that:
o We have executed an agreement for an acquisition or merger;
o The fair market value of the acquisition or merger candidate represents at
least 80% of the maximum offering proceeds;
o We have filed the required post-effective amendment;
o The post-effective amendment has been declared effective, that the mandated
reconfirmation offer having the conditions prescribed by Rule 419 has been
completed and that the company has satisfied all of the prescribed
conditions of the reconfirmation offer.
HIGH RISK FACTORS
There is a high degree of risk associated with an investment in our common
stock. You should know that our business, financial condition or results of
operations, and especially, that of any business we acquire, could be materially
and adversely affected by any of the following risks. Consequently, the shares
we are offering should be purchased only by investors who can afford to lose
their entire investment. Carefully consider these factors before considering the
purchase of the shares.
1. We anticipate a change in control and management. If the initial public
offering is completely sold, management and the sole officer and director will
own at least seventy one (71%) percent of the common stock of the company.
However, once we merge with or acquire another business, we anticipate that we
will have to issue to that entity an amount of our common stock which will
comprise a majority of the issued and outstanding shares of our common stock.
This will likely result in a change of control in the company. In addition, the
company's present officer and director will likely resign or be removed. We
cannot assure you of the experience or qualification of new management either in
the operation of the company's activities or in the operation of the business,
assets or property being acquired.
2. We are a development stage company with no record for you to evaluate.
The company was incorporated in the State of Delaware on June 9, 2000 and has
had no operations to date. The company was formed to serve as a vehicle to
effect a business combination. We cannot assure you that the company's intended
acquisition or merger activities will succeed or be profitable. Since we have
not yet attempted to seek a business combination, and due to our lack of
experience, there is only a limited basis upon which to evaluate the company's
prospects for achieving its intended business objectives. We face all risks
which are associated with any new business. Any investment in these securities
should be considered an extremely high risk investment.
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3. We have some discretion in use of the proceeds. 90% of the net proceeds
of this offering must be held in escrow until we enter into a business
combination, which must occur within 18 months of the effective date of this
offering. The funds from this offering may not be sufficient for fund the
company's search for a merger or acquisition candidate. Rule 419 permits 10% of
the net proceeds of the offering to be disbursed to the company from the escrow
account before we enter into an acquisition or merger. We intend to request
release of this money. If we do not request release of these funds, we will
receive these funds in the event we enter into an acquisition or merger.
4. You will have no access to your money while it is in escrow. We are
offering for sale 10,000 shares, at $1.00 per Share. The maximum offering period
is 180 days. No one has committed to purchase any portion of these securities.
You will have no right to the return or the use of your money and you cannot
earn interest on it until conclusion of the offering. Your money (minus payments
for expense amounts, if any, which are permitted by Rule 419) may remain in the
escrow account, and will not earn interest. You will have no right to the return
of or the use of their funds for a period of 18 months from the effective date.
Investors will be offered return of their pro rata portion of the funds
held in escrow only in connection with the reconfirmation offering. If the
company is unable to find an acquisition or merger target, you will have to wait
18 months from the effective date before a pro rata portion of your money is
returned without interest.
5. We will not be able to consummate an acquisition or merger if enough
investors do not reconfirm their investment. Under Rule 419, investors
representing 80% of the maximum offering proceeds must reconfirm their
investments in order for us to merge with or acquire a business. Otherwise, the
business combination will not be consummated, none of the securities held in
escrow will be issued and the escrowed funds will be returned to investors on a
pro rata basis.
6. We have extremely limited capital. As of July 18, 2000, we had assets of
$2,064 and no liabilities. Of the $10,000 in proceeds of the offering, we may
use $1,000 as capital in order to seek a business combination. We will use the
money in the company's treasury to pay the costs of conducting the company's
business activities. Assuming suitable prospects are identified, if ever, the
company may be unable to complete an acquisition or merger due to a lack of
sufficient funds. For example, this may occur if a target company insists the
company obtain additional capital. Therefore, we may need additional financing
in order to consummate a business combination. Such financing may consist of the
issuance of debt or equity securities. We cannot assure you that such funds will
be available, that they will be available on terms acceptable to us.
7. The escrowed securities may not be sold. You will not be able to
transfer the escrowed securities except by will or the laws of descent and
distribution, or pursuant to a qualified domestic relations order (divorce
proceedings) as that term is defined by the Internal Revenue Code of 1986, or
Title 7 of the Employee Retirement Income Security Act. The law prohibits you
from selling or offering to sell the securities held in the escrow account other
than in divorce proceedings.
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Therefore, any contract which obligates you to deliver the securities (e.g.,
contract for sale on a "when as" and "if used" basis) are prohibited. You also
may not sell any interest in the securities or any derivative securities whether
or not physical delivery is required.
8. There may not be a public market for the shares you buy. Under Rule 419,
all securities issued by a blank check company must be placed in an escrow
account. These securities will not be released from escrow until we identify a
merger or acquisition candidate and complete the transaction. There is no
present market for the common stock of the company and there is no likelihood
that any active and liquid public trading market will develop after the
securities are released from escrow. Therefore, you may find it difficult to
sell your shares. To date, we have not asked any broker dealer to act as a
market maker for our common stock. We do not intend to seek a market maker for
our common stock until you and other investors reconfirm your investments in
this offering and we enter into an acquisition or merger.
9. We are at a competitive disadvantage in seeking business combinations.
To date, we have not selected any particular industry in which to concentrate
our merger or acquisition efforts. In relation to our competitors, we are an
insignificant participant in the business of seeking business combinations. Many
established and well-financed entities, including venture capital firms, have
recently increased their merger and acquisition activities. Nearly all of them
have significantly greater financial resources, technical expertise and
managerial capabilities than we do. Consequently, we will be at a competitive
disadvantage in identifying suitable merger or acquisition candidates and
successfully consummating a merger or acquisition. Also, we will be competing
with a large number of other small, blank check companies.
10. The time to be devoted by management to the affairs of Montana
Acquisition Corporation will be limited and could be inadequate. Our sole
officer and director is engaged in business activities outside of the company,
and will only devote what time he fan to our affairs. His priority will be his
responsibilities in his full-time occupation.
11. Our management may face conflicts resulting from involvement in other
businesses. Because our sole director and officer is primarily engaged in
business outside the company, he may have a conflict of interest with our
pursuit of business combinations. In an effort to avoid such conflicts, we will
adopt a procedure whereby a special meeting of our shareholders will be called
to vote on a business combination with an affiliated entity. Shareholders who
also hold securities of that affiliated entity will be required to vote their
shares of our stock in the same proportion as our publicly-held shares are
voted. This procedure will be in the form of an oral agreement between
management and the company. Our sole officer and director is not currently
involved in other blank check companies. However, potential conflicts of
interest may result if and when any officer of the company becomes an officer or
director of another company, especially another blank check company.
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12. Our Certificate of Incorporation, Bylaws and Minutes do not require our
officers and directors to disclose to the company merger or acquisition
candidates that come to their attention. The officers and directors do, however,
have a fiduciary duty of loyalty to the company to disclose to the company any
target businesses that they discover, even if they learn about it through their
involvement as an officer and director of another company. We will not purchase
the assets of any company which is beneficially owned by any officer, director,
promoter or affiliate or associate of this company. Management will examine a
target business's financial statements, its assets and liabilities and its
projections for future growth.
13. Potential Related Party Business Combination. The company may acquire a
business in which the company's promoters, management or their affiliates own a
beneficial interest. In such event, such transaction may be considered a related
party transaction not at arms-length. No related party transaction is presently
contemplated. If in the event a related party transaction is contemplated
sometime in the future, the company intends to seek shareholder approval through
a vote of shareholders. However, shareholders objecting to any such related
party transaction will be able only to request the return of the pro-rata
portion of their invested funds held in escrow in connection with the
reconfirmation offering to be conducted in accordance with Rule 419 upon
execution of the acquisition agreement.
14. There are possible disadvantages of a blank check offering. We might
acquire or merge with a company which does not need substantial additional
capital but which desires to establish a public trading market for its shares. A
company seeking to consolidate its operations through a merger, reorganization,
asset acquisition, or some other form of combination with us may want to do so
to avoid the adverse consequences of undertaking a public offering themselves.
Their reasoning may include factors such as time delays, significant expense,
loss of voting control and their inability or unwillingness to comply with
various federal and state laws enacted for the protection of investors. In
making an investment in us you may be doing so under terms which may ultimately
be less favorable than making an investment directly in a company with a
specific business.
15. We have not researched or identification of acquisition or merger
candidate. The company has not conducted nor received the results of market
research concerning the feasibility of a business combination with a specific
target business. Therefore, management is not sure that market demand exists for
an acquisition or merger as contemplated by the company. Management has not
selected any particular industry or specific business within an industry to
evaluate. There is no assurance the company will be able to form a business
combination on terms favorable to the company.
16. Our success is dependent on management. Our sole officer and director
has limited experience in the business activities in which we intend to engage.
While he believes he has sufficient experience to implement our plan, there is
no assurance that additional managerial assistance will not be required. Our
success depends on the active participation of our officer. The officer has not
entered into an employment agreement with the company and is not expected to do
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so in the foreseeable future. We have not obtained key man life insurance on our
sole officer and director.
17. We have not yet identified an acquisition or merger candidate. As of
the date of this prospectus, there are no present arrangements or understandings
with any representatives of the owners of any business regarding the possibility
of a merger or acquisition. Because we have not yet sought a candidate for a
business combination, there is a limited basis on which you can evaluate the
prospects for our success.
18. We lack the diversity that may be needed for success. If we identify a
suitable merger or acquisition candidate, we will in all likelihood be required
to issue our common stock in an acquisition or merger transaction. Inasmuch as
the company's capitalization is limited and the issuance of additional common
stock will result in a dilution of interest for present and prospective
shareholders, it is unlikely we will be capable of negotiating more than one
acquisition or merger. This lack of diversification will prevent us from being
able to offset potential losses from one venture against another.
19. We can't assure you that we won't be subject to regulation as an
"Investment Company." Although we will be subject to regulation under the
Securities Act of 1933 and the Securities Exchange Act of 1934, we believe we
will not be subject to regulation under the Investment Company Act of 1940. The
regulations under the Investment Company Act of 1940, which was enacted
principally for the purpose of regulating vehicles for pooled investments in
securities, extends generally to Companies primarily in the business of
investing, reinvesting, owning, holding or trading securities. The Investment
Company Act may, however, also be applicable to a company which does not intend
to be characterized as an Investment Company but which, nevertheless, engages in
activities which may be deemed to be within the definition of the scope of
certain provisions of the Investment Company Act.
We can not assure you that the company will not be deemed to be an
Investment Company. The net proceeds may be invested primarily in certificates
of deposit, interest bearing savings accounts or government securities. In the
event the company is deemed to be an Investment Company, we may be subject to
certain restrictions relating to our activities, including restrictions on the
nature of our investments and the issuance of securities. We have obtained no
formal determination from the Securities and Exchange Commission as to the
status of the company under the Investment Company Act of 1940.
20. We can't assure you a merger would not be taxable. Any acquisition or
merger that we enter into will be evaluated for its federal and state tax
consequences for us and the "target" company. Presently, a qualified
reorganization between business entities will generally not be taxable for the
parties to the transaction. While we expect to undertake any merger or
acquisition so as to minimize federal and state tax consequences, we cannot
assure you that such a transaction will meet the statutory requirements of a
reorganization or that the parties will obtain the intended tax-free treatment
upon a transfer of stock or assets. A non-qualifying reorganization could result
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in the imposition of both federal and state taxes which may have a substantial
adverse effect on the company.
21. We have paid no dividends and won't in the near future. We were only
recently organized, have no earnings, and have paid no dividends to date. Since
we are a blank check company with its only intended business being the search
for an appropriate business combination, we do not anticipate having any
earnings until a business combination is effected. However, there are no
assurances that even upon the consummation of a business combination, we will
have earnings or issue dividends. Therefore, we do not expect to pay cash
dividends, if at all, until after a business combination is effected.
22. We have arbitrarily determined the offering price. We arbitrarily
determined the initial offering price of $1.00 per share. It bears no
relationship whatsoever to the company's assets, earnings, book value or any
other objective standard of value. Among the factors we considered in
determining the offering price were:
o The lack of operating history of the company;
o The net proceeds to be raised by the Offering;
o The amount of capital to be contributed by the public in proportion to
the amount of stock to be retained by present stockholders;
o The relative requirements of the company;
o The current market conditions in the over-the-counter market.
23. Present management and shareholders have substantial control of the
company. The present shareholder of the company will own a minimum of 71% of the
company after the offering is completed. He would therefore have continuing
control of the company, and the ability to elect all of our directors and
officers, and control our affairs and operations. Our Certificate of
Incorporation does not provide for cumulative voting. There are no arrangements,
agreements or understandings between non-management shareholders and management
under which non- management shareholders may directly or indirectly participate
in or influence the management of the company's affairs or to exercise their
voting rights to continue to elect the current directors.
24. The value of shares you purchase is subject to immediate substantial
dilution. Assuming we sell all the shares offered in this offering, the net
tangible book value of the company's common stock will be approximately $0.34
per share, substantially less than the $1.00 per share to be paid by the public
investors. Therefore, you will sustain an immediate dilution of approximately
$0.66 per share in the book value of your holdings.
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25. Insiders could purchase shares. Our officer, director, current
shareholder and any of his affiliates or associates may purchase shares offered
in this offering. Any shares he purchases will be acquired for investment
purposes and not with a view towards distribution.
26. Shares in this offering are available only to residents of New York and
Florida. Registration in New York is not required for certain offerings made to
fewer than 40 people. Registration in Florida is not required for offerings in
which the total number of purchases in Florida does not exceed 35. We will use
our best efforts to ensure that sales of shares will only occur in those states
in which such sales would not be a violation of any states laws.
27. There are risks associated with a leveraged transaction. We are not
prohibited from consummating a business combination through a leveraged
transaction. However, such a transaction could result in our assets being
mortgaged and possibly foreclosed. The use of leverage to consummate a business
combination may reduce our ability to incur additional debt, make other
acquisitions or declare dividends. Such leverage may also subject the company's
operations to strict financial controls and significant interest expense.
28. Laws regulating low-priced stocks may affect your ability to sell your
shares. Transactions in "penny stocks" are regulated by certain rules adopted by
the Securities and Exchange Commission. With some exceptions, penny stocks
generally are equity securities with a price of less than $5.00. Under the penny
stock rules, a broker-dealer planning a transaction in a penny stock must
provide the customer with extensive disclosure documents. These disclosure
requirements may reduce the level of trading activity in the secondary market
for a stock that becomes subject to the penny stock rules. If the our common
stock becomes subject to the penny stock rules, you may find it more difficult
to sell your shares.
DILUTION
The net tangible book value of the company as of July 18, 2000 was $0.08
per share. Net tangible book value is the net tangible assets of the company
(generally, total assets less total liabilities). The public offering price per
share is $1.00. The pro forma net tangible book value per share after the
offering will be $0.34. Therefore, the shares purchased by investors in this
offering will be diluted $0.66. As of July 18, 2000, there were 25,000 shares of
the company's common stock outstanding. Dilution represents the difference
between the public offering price and the pro forma net tangible book value per
share immediately after the completion of the public offering. The following
table illustrates this per share dilution to be experienced by investors in the
offering:
Public offering price per share $ 1.00
Net tangible book value per share before offering $ 0.08
Pro forma net tangible book value per share after offering $ 0.34
Increase per share attributable to purchases in this offering $ 0.26
Dilution to public investors $ 0.66
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# Shares Before Money Received for Net Tangible Book Value
Offering Shares Before Offering Per Share Before Offering
---------------------- ------------------------- --------------------------
25,000 $2,500 $0.08
Pro Forma Net
Total # of Shares Total Amount of Money Tangible Book Value Per
After Offering Received For Shares Share After Offering
---------------------- ------------------------- --------------------------
35,000 $10,000 $0.34
Pro Forma Net Tangible Increase Per
Book Value Per Share Net Tangible Book Value Share Attributed
After Offering Per Share Before Offering To Shares Offered Hereby
---------------------- ------------------------- --------------------------
$0.34 $0.08 $0.26
Pro Forma Net
Public Offering Tangible Book Value Dilution to
Price Per Share Per Share After Offering Public Investors
---------------------- ------------------------- --------------------------
$1.00 $0.34 $0.66
As of the date of this prospectus, the following table sets forth the
percentage of equity to be purchased by public investors in this offering
compared to the percentage of equity to be owned by the present stockholder, and
the comparative amounts paid for the shares by the public investors as compared
to the total consideration paid by the present stockholder of the company.
Approx. % Total
Shares Shares Total Approx. % Total
Stockholders Purchased Outstanding Consideration Consideration
New Investors 10,000 29 $10,000 80%
Existing 25,000 71 $2,500 20%
Stockholder
USE OF PROCEEDS
The gross proceeds of this offering will be $10,000, if all of the shares
are sold. Pursuant to Rule 419 under the Securities Act, after all of the shares
are sold, 10% of the deposited funds
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($1,000) may be released from escrow to the company. We intend to request
release of this 10%. In the event that we do not request release of these funds,
we will receive these funds in the event a business combination is consummated
in accordance with Rule 419. After we complete a business combination and after
the shareholder reconfirm their investment in our common stock, $9,000 (plus any
dividends received, but less any portion disbursed to the company and less any
amount returned to investors who did not reconfirm their investment) will be
released to the company.
Approximate Percentage
Amount Total
Escrowed funds pending
business combination ............................. $9,000 90%
(1) The amount of the escrowed funds shown above does not include the estimated
$8,352.64 of offering expenses.
(2) The company expects to request release of 10% of the deposited funds
($1,000) pursuant to Rule 419.
The expenses payable by the Registrant in connection with the issuance and
distribution of the securities being registered are estimated as follows:
Escrow Fee ............................ $ 1,000.00
Securities and Exchange
Commission Registration Fee ........... $ 2.64
Legal Fees ............................ $ 5,000.00
Accounting Fees ....................... $ 1,000.00
Printing and Engraving ................ $ 100.00
Blue Sky Qualification
Fees and Expenses...................... $ 350.00
Miscellaneous ......................... $ 1,000.00
Transfer Agent Fee .................... $ 0
TOTAL ................................. $ 8,452.64
We do not intend to advertise or promote the company. Instead, our
management will actively search for potential target businesses. If we decide to
advertise (in the form of an ad in a legal publication) to attract a target
business, the cost of that advertising will be assumed by management.
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Once we enter into a merger or acquisition, we anticipate that there will
be a change in the management. New management may decide to change the policies
regarding use of proceeds of this offering. The company's present management
anticipates that those proceeds will be used by the post-merger management at
its sole discretion. No compensation will be paid or due or owing to any officer
or director until after we complete a merger or acquisition. We are not
presently considering any outside individual for a consulting position; however,
we cannot rule out the need for outside consultants in the future. No decisions
have been made as to payment of these consultants.
Present management of the company will not make any loans of the $1,000
that will be available from the escrowed funds of this offering, nor will we
borrow funds and use either our working capital or the escrowed funds as
security. Once the escrowed funds are released from escrow, management may loan
the proceeds or borrow funds and use the proceeds as security.
The proceeds received in this offering will be put into the escrow account
pending consummation of a business combination and reconfirmation by investors.
The funds will be placed in an interest bearing account by Whiteman Osterman &
Hanna.
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CAPITALIZATION
The following table sets forth the capitalization of the company as of July
18, 2000, and as adjusted to give effect to the sale of all of the Shares
offered by the company.
Actual Pro-Forma As
Adjusted
Long-term debt $ 0 $ 0
Stockholders' equity: Common stock, $.001 par value; $ .08 $ .34
authorized 50,000 shares, issued and outstanding
25,000 shares and 35,000 shares, pro-forma as
adjusted
Additional paid-in capital $ 0 $10,000
Deficit accumulated during the development period $ 0 $ 0
Stockholders' deficit, net $ 0 $ 0
Total capitalization $2,500 $12,500
For the terms of the company's long-term debt, see "Certain Transactions,"
and "Description of Securities."
PROPOSED BUSINESS
History and Organization
Montana Acquisition Corporation was organized under the laws of the State
of Delaware on June 9, 2000. Since inception, the primary activity of the
company has been directed to organizational efforts and obtaining initial
financing. The company was formed as a vehicle to pursue a business combination.
We have not engaged in any preliminary efforts intended to identify possible
merger or acquisition candidates and have neither conducted negotiations
concerning, nor entered into a letter of intent concerning any such transaction.
Our initial public offering will comprise 10,000 shares of common stock at
a purchase price of $1.00 per share.
We are filing this registration statement in order to effect a public
offering for our securities.
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Plan of Operation
The company was organized for the purposes of creating a corporate vehicle
to seek, investigate and, if such investigation warrants, engage in business
combinations presented to it by persons or firms who desire to employ the
company's funds in their business or to seek the perceived advantages of a
publicly-held corporation. Our principal business objective will be to seek
long-term growth potential in a business combination venture rather than to seek
immediate, short-term earnings. We will not restrict our search for merger or
acquisition candidates to any specific business, industry or geographical
location.
None of the company's officers, directors, promoters, their affiliates or
associates have had any preliminary contact or discussions with and there are no
present plans, proposals, arrangements or understandings with any
representatives of the owners of any business or company regarding the
possibility of an acquisition or merger transaction contemplated in the
prospectus.
We do not currently engage in any business activities which provide any
cash flow. The costs of identifying, investigating, and analyzing business
combinations will be paid with money in the our treasury. You and other
shareholders will most likely not have the opportunity to participate in any of
these decisions. Our proposed business is sometimes referred to as a "blank
check" company because investors will entrust their investment monies to our
management before they have a chance to analyze any ultimate use to which their
money may be put. Although substantially all of the proceeds of this offering
are intended to be used generally to effect a business combination, the proceeds
are not otherwise being designated for any specific purposes. Under to Rule 419,
you will have an opportunity to evaluate the specific merits or risks of only
the merger or acquisition that management decides to enter into. Cost overruns
will be borne equally by all current shareholders of the company.
We may seek a business combination with firms which:
o have recently commenced operations;
o are developing companies in need of additional funds for expansion
into new products or markets;
o are seeking to develop a new product or service; or
o are established businesses which may be experiencing financial or
operating difficulties and are in need of additional capital.
A business combination may involve the acquisition of, or merger with, a
company which does not need substantial additional capital but which wants to
establish a public trading market for its shares. Such a company may choose this
transaction to avoid what it may deem to be adverse consequences of undertaking
a public offering itself, such as time delays, significant expense, loss of
voting control and compliance with various federal and state securities laws.
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We will not acquire or merge with another company unless the fair market
value of that company represents 80% of the maximum offering proceeds. To
determine the fair market value of a target business, our management will
examine the audited financial statements of any candidate, focusing their
attention on the potential target business's assets, liabilities, sales and net
worth. In addition, management will participate in a personal inspection of any
potential target business. If we determine that the financial statements of a
proposed target business do not clearly indicate that the fair market represents
at least 80% of the offering proceeds, we will obtain an opinion from an
investment banking firm with respect to the satisfaction of that criteria.
Based upon management's experience with and knowledge of blank check
companies, the probable desire on the part of the owners of target businesses to
assume voting control over the company will almost assure that we will combine
with just one target business. Management also anticipates that after the
combination, control of the company will change and will most likely result in
the resignation or removal of our present officer and director. The company's
officer and director has had no preliminary contact or discussions with any
representative of any other entity regarding a business combination.
Accordingly, any candidate that is selected may be a financially unstable
company or an entity in its early stage of development or growth (including
entities without established records of sales or earnings).
The company will become subjected to numerous risks inherent in the
business and operations of financially unstable and early stage or potential
emerging growth companies. In addition, we may combine with an entity in an
industry characterized by a high level of risk, and although management will
endeavor to evaluate the risks inherent in a particular industry or target
business, we cannot assure you that we will properly ascertain or assess all
significant risks.
We anticipate that we will be able to effect only one business combination,
due primarily to our limited financing, and the dilution of interest for our
present and prospective shareholders, which is likely to result from a merger or
acquisition. This lack of diversification should be considered a substantial
risk in investing in the company because it will not permit the company to
offset potential losses from one venture against gains from another.
We anticipate that the selection of an acquisition or merger target 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 even the
limited additional capital which we will have and/or the benefits of a publicly
traded corporation. The 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 statutes)
for all shareholders, and other factors. Potentially available business
combinations 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.
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Evaluation of Business Combinations
Our sole officer and director, who is not a professional business analyst,
will oversee the analysis of business combinations. He intends to concentrate on
identifying preliminary prospective business combinations through present
associations. In analyzing prospective business combinations, he will consider
the following factors:
o the available technical, financial, and managerial resources;
o working capital and other financial requirements;
o history of operation, if any;
o prospects for the future; nature of present and expected competition;
o the quality and experience of management services which may be
available and the depth of that management; o the potential for
further research, development, or exploration;
o specific risk factors not now foreseeable but which then may be
anticipated to impact the proposed activities of the company; o the
potential for growth or expansion;
o the potential for profit;
o the perceived public recognition or acceptance or products, services,
or trades;
o name identification
The officer and director of the company will meet personally with
management and key personnel of the firm sponsoring the business opportunity as
part of his investigation. To the extent possible, we intend to utilize written
reports and personal investigation to evaluate the above factors.
Since the company will be subject to Section 13 or 15 (d) of the Securities
Exchange Act of 1934, we will have to furnish certain information about
significant acquisitions, including audited financial statements for the
company(s) acquired, covering one, two or three years depending upon the
relative size of the acquisition. Consequently, acquisition prospects that do
not have or are unable to obtain the required audited statements may not be
appropriate for acquisition so long as these reporting requirements are
applicable. In the event our obligation to file periodic reports is suspended
under Section 15(d), we intend to voluntarily file such reports.
We anticipate that any business combination will present certain risks.
Many of these risks cannot be adequately identified prior to selection.
Therefore, you must depend on the ability of management to identify and evaluate
such risks. In the case of some of the potential merger or acquisition targets
available to the company, we anticipate that the promoters of those businesses
have been unable to develop a going concern or that the business is in its
development stage in that it has not generated significant revenues from its
principal business activity. There is a risk, even after we merge with or
acquire such a business, that the combined enterprises will still be unable to
become a going concern or advance beyond the development stage. Many of the
combinations may involve new and untested products, processes, or market
strategies which may not succeed. Such risks will be assumed by the company and,
therefore, its shareholders.
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Business Combinations
In implementing a structure for a particular business acquisition, we may
become a party to a merger, consolidation, reorganization, joint venture, or
licensing agreement with another corporation or entity. We may also purchase
stock or assets of an existing business.
Any merger or acquisition effected by the company could have a significant
dilutive effect on the percentage of shares held by the company's
then-shareholders, including purchasers in this offering. When we combine with a
target business, the target business will have significantly more assets than we
do. Therefore, management plans to offer a controlling interest in the company
to the target business. While we can't predict the actual terms of a
transaction, we expect that the parties will want to avoid the creation of a
taxable event by structuring the acquisition in a so-called "tax- free"
reorganization under Sections 368(a)(1) or 351 of the Internal Revenue Code of
1986. In order to obtain tax-free treatment under the Code, the owners of the
target business may have to own 80% or more of the voting stock of the surviving
entity. In that event, the shareholders of our company, including investors in
this offering, would retain less than 20% of the issued and outstanding shares
of the surviving entity, which would mean significant dilution in the equity of
those shareholders. Management of the company may choose this type of
transaction. In addition, the company's director and officer may, as part of the
terms of the acquisition transaction, resign those positions. (See "High Risk
Factors" and "Dilution").
Management will not actively negotiate or otherwise consent to the purchase
of any portion of their common stock as a condition to or in connection with a
proposed business combination unless a target company requests such a purchase
as a condition to a merger or acquisition. The officer and director of the
company has agreed to comply with this provision which is based on a written
agreement among management. Management is unaware of any circumstances under
which such policy through their own initiative may be changed.
Any securities issued in any such reorganization would be issued in
reliance on exemptions from registration under applicable federal and state
securities laws. In some circumstances, however, as a negotiated element of this
transaction, the company may agree to register such securities either at the
time the transaction is consummated, under certain conditions, or at specified
times thereafter. The issuance of substantial additional securities and their
potential sale into any trading market which may develop in our common stock may
have a depressive effect on such market.
As a part of the company's investigation of possible business combination
candidates, the company's officer and director will meet personally with
management and key personnel, visit and inspect material facilities, obtain
independent analysis or verification of certain information provided, check
references of management and key personnel, and take other reasonable
investigative measures, to the extent of the company's limited financial
resources and management expertise.
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The manner of the business combination will depend on the nature of the
target business, the respective needs and desires of the company and other
parties, the management of the target business, and the relative negotiating
strength of the company.
If we enter negotiations with a possible merger candidate at any time prior
to the completion of this offering, and such a transaction becomes probable,
then this offering will be suspended so that we can file an amendment which will
include financial statements of the proposed target.
We have adopted a policy that we will not pay a finder's fee to any member
of management for locating a merger or acquisition candidate. No member of
management intends to or may seek and negotiate for the payment of finder's
fees. In the event there is a finder's fee, it will be paid at the direction of
the successor management after a change in management control resulting from a
business combination. Our policy regarding finder's fees is based on an oral
agreement among management. Management is unaware of any circumstances under
which such policy through their own initiative may be changed.
Regulation
The Investment Company Act defines an "investment company" as an issuer
which is or holds itself out as being engaged primarily in the business of
investing, reinvesting or trading of securities. While we do not intend to
engage in such activities, we could become subject to regulations under the
Investment Company Act if we obtain or continue to hold a minority interest in a
number of enterprises. The company could be expected to incur significant
registration and compliance costs if required to register under the Investment
Company Act. Accordingly, management will continue to review the company's
activities from time to time with a view toward reducing the likelihood that we
could be classified as an "Investment Company."
Employees
We currently do not have any employees. The sole officer and director of
the company is engaged in business activities outside of the company, and thus
will only devote time and effort in connection with our business and operations
on a part time basis. Upon completion of the public offering, it is anticipated
that the officer and director of the company will devote the time necessary each
month to the affairs of the company until a successful business opportunity has
been acquired.
Facilities
We are presently using the office of an affiliated entity, located at 241
Morner Road, Rensselaer, New York 12144, at no cost to the company. Such
arrangement is expected to continue after completion of this offering only until
a business combination is consummated, although there
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is currently no such agreement. The company at present owns no equipment, and
does not intend to own any upon completion of this offering.
MANAGEMENT
The sole officer and director of the company, and further information concerning
them, is as follows:
Name Age Position
---- --- --------
Leslie M. Apple 50 President, Secretary, Treasurer,
Director
Biographies
Leslie M. Apple has been a practicing attorney in Albany, New York for
approximately 25 years. Since January of 1995, Mr. Apple has been a partner in
the Albany, New York law firm of Whiteman Osterman & Hanna. Prior to January
1995, Mr. Apple was President and CEO of Apple Honen Sims and Wood, P.C., a law
firm he founded as Leslie M. Apple, P.C. in August, 1985.
Executive Compensation
Neither the payment of the director's compensation by the target company,
nor the repayment of loans or advances to the sole officer and director by the
target company will be a criteria in considering any merger or acquisition
candidate.
Other Blank Check Companies
Competing searches for combination candidates among blank check affiliates
may present conflicts of interest. Management intends to present each business
combination candidate to the shareholders for their approval. There are
currently no other blank check affiliates seeking combination candidates. The
company's offering and other contemplated offerings (if any) by other blank
check companies do not constitute a single plan of financing.
The company may not acquire, be acquired by or merge with any affiliated
blank check companies or join with such companies in acquiring a business.
Conflicts of Interest
Our sole officer and director is not currently affiliated or associated
with any blank check company. He does not currently intend to promote blank
check entities other than the company. However, he may become involved with the
promotion of other blank check companies in the future.
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A potential conflict of interest may occur in the event of such involvement.
Management intends to present each business combination candidate to the
shareholders for their approval.
Remuneration
The company's sole officer and director has not received any cash
remuneration since the company's inception, and he is not to receive or accrue
any remuneration or reimbursements of expenses from the company upon completion
of this offering. No remuneration of any nature has been paid for or on account
of services rendered by a director in such capacity.
The legal fee to be paid to Whiteman Osterman & Hanna, counsel for the
corporation, is five thousand dollars ($5,000.00), which has not been paid to
prior to this offering and is contingent on the company successfully completing
a business combination.
Management Involvement
The company has conducted no business as of yet, and aside from the search
for shareholders associated with the company's formation, management has done no
work with or for the company. Management will speak to business associates and
acquaintances and will search the New York Times, the Wall Street Journal and
other business publications for merger or acquisition candidates. After the
closing of this offering, management intends to search for, consider and
negotiate with a target business.
Management Control
Management may not divest themselves of ownership and control of the
company prior to the consummation of an acquisition or merger transaction.
Management is not aware of any circumstances under which such policy through
their own initiative, may be changed.
Prior Experience in Blank Check Offerings
Neither the company's promoters nor its management has engaged in any
previous blank check offerings.
STATEMENT AS TO INDEMNIFICATION
Section 145 of the Delaware General Corporation Law provides for
indemnification of the officers, directors, employees and agents of registrants
by the company. Complete disclosure of this statute is provided in Part II of
this prospectus. This information can be examined as described in "Further
Information."
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Paragraph Seventh of the Certificate of Incorporation of the Montana
Acquisition Corporation provides as follows:
The corporation shall, to the fullest extent permitted by Section 145 of
the General Corporation Law of the State of Delaware, as the same may be
amended and supplemented, indemnify any and all persons whom it shall have
power to indemnify under said section from and against any and all of the
expenses, liabilities, or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled
under any by-law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office, and shall continue
as to a person who has ceased to be a director, officer, employee, or agent
and shall inure to the benefit of the heirs, executors, and administrators
of such a person.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling the registrant
pursuant to the foregoing provisions, the registrant has been informed that in
the opinion of the Securities and Exchange Commission such indemnification is
against the public policy as expressed in the Securities Act and is therefore,
unenforceable.
MARKET FOR THE COMPANY'S COMMON STOCK
Prior to the date of this prospectus, there has been no trading market for
our common stock. Pursuant to the requirements of Rule 15g-8 of the Exchange
Act, a trading market will not develop prior to or after the effectiveness of
this prospectus or while the common stock under this offering is maintained in
escrow. The common stock under this offering will remain in escrow until the
company enters into a business combination. There is currently one (1) holder of
the company's outstanding common stock. Current shareholders will own a minimum
of 71% of the outstanding shares after this offering is completed. As a result,
there is no likelihood of an active public trading market, as that term is
commonly understood, developing for the shares. We cannot assure you that a
trading market will develop after we complete a merger or acquisition and the
shares purchased in this offering are released from escrow. To date, neither the
company nor anyone acting on its behalf has taken any affirmative steps to
retain or encourage any broker dealer to act as a market maker for our common
stock.
Present management does not anticipate that any such negotiations,
discussions or understandings shall take place prior to the execution of an
acquisition agreement. Management expects that discussions in this area will
ultimately be initiated by the party or parties that control the entity that we
merge with or may acquire. Those parties may employ consultants or advisors to
obtain a market maker, but present management of the company has no intention of
doing so at the present time. Our sole officer and director and controlling
shareholder has not in the past used
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particular consultants or advisers, and the company has no set criteria to use
in its possible evaluation of any consultants or advisers.
Whiteman Osterman & Hanna's legal fees will total five thousand dollars
($5,000), none of which has yet been paid by the company for legal services
rendered.
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information regarding the beneficial
ownership of the our common stock as of the date of this prospectus. It is
adjusted to reflect the sale of the shares offered in this prospectus, by:
o each person who is known by the company to own beneficially more than 5% of
the company's outstanding common stock;
o each of the company's officers and directors; and
o all directors and officers of the company as a group.
Name/Address Shares of Percent of Percent of
Beneficial Common Stock Class Owned Class Owned
Owner Beneficially Owned Before Offering After Offering
Leslie M. Apple 25,000 100% 71%
6 Greyledge Drive
Loudonville, NY
12211
Total Officers 25,000 100% 71%
and Directors
(1 Person)
Total (1 Person) 25,000 100% 71%
DESCRIPTION OF SECURITIES
Common Stock
We are authorized to issue 50,000 shares of common stock, $.001 par value
per share. 25,000 shares were issued and outstanding as of the date of this
prospectus. Each outstanding share of
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common stock is entitled to one vote, either in person or by proxy, on all
matters that may be voted upon at meetings of the stockholders.
Stockholders of common stock have the following rights or limitations on
their rights:
o They have equal ratable rights to dividends from legally available funds
when and if the board of directors declares dividends of the company;
o They are entitled to share ratably in all of the assets of the company
available for distribution to holders of common stock;
o In the event of liquidation, dissolution or winding up of the affairs of
the company, they do not have preemptive, subscription or conversion
rights, or redemption or sinking fund provisions applicable to those
rights; and
o They are entitled to one non-cumulative vote per share on all matters on
which stockholders may vote at all meetings of stockholders.
All shares of common stock which are the subject of this offering, when
issued, will be fully paid for and non-assessable, and will have no personal
liability attaching to the ownership of them. Our stockholders do not have
cumulative voting rights, which means that the holders of more than 50% of the
outstanding shares voting for the election of directors can elect all of the
directors of the company if they so choose. In that event, the holders of the
remaining shares will not be able to elect any of the company's directors. At
the completion of this offering, the present officer and director and sole
shareholder will beneficially own at least 71% of the outstanding shares, and
therefore, will be in a position to control all of the affairs of the company.
Future Financing
In the event the proceeds of this offering are not sufficient to fund the
company's search for a merger or acquisition candidate, we may seek additional
financing. At this time, we believe that the proceeds of this offering will be
sufficient and so we do not expect to issue any additional securities before we
complete a business combination. However, we may issue additional securities,
incur debt or secure other types of financing. We have not entered into any
agreements, plans or proposals for financing through the issuance of additional
securities and we have no plans to do so. We will not use the escrowed funds as
collateral or security for or to pay back, any loan or debt that we incur. If we
do require additional financing, there is no guarantee that such financing will
be available, or if available, that it will be on terms acceptable to us.
Reports to Stockholders
We intend to furnish our stockholders with annual reports containing
audited financial statements as soon as practicable at the end of each fiscal
year.
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Dividends
We were only recently organized, have no earnings, and have paid no
dividends to date. Since we were formed as a blank check company with our only
intended business being the search for an appropriate business combination, we
do not anticipate having any earnings until a business combination is
reconfirmed by the stockholders. However, we cannot assure you that after we
complete a business combination, we will have earnings or issue dividends.
Therefore, we do not expect to pay that cash dividends to stockholders until
after a business combination is reconfirmed.
Transfer Agent
The company will act as its own transfer agent.
PLAN OF DISTRIBUTION
Montana Acquisition Corporation is offering the right to subscribe for
10,000 shares at $1.00 per share. We propose to offer the shares directly on a
"best efforts basis" with no minimum, and we will pay no compensation to any
person in connection with the offer and sale of the shares. Our sole officer and
director will distribute prospectuses related to this offering. We estimate that
he will distribute no more than one hundred (100) prospectuses, primarily to
friends and business associates. Although the sole officer and director is an
"associated person" of the company as that term is defined in Rule 3a4-1 under
the Securities Exchange Act of 1934, he is deemed not to be a broker for the
following reasons:
(1) He is not subject to a statutory disqualification as that terms is defined
in Section 3(a)(39) of the Exchange Act at the time he participates in the
sale of our securities;
(2) He will not be compensated for assisting in the sale of our securities with
commissions or other remuneration based either directly or indirectly on
transactions in securities;
(3) He is not an associated person of a broker or dealer at the time he
participates in the sale of our securities; and
(4) He will restrict his participation to the following activities:
(a) preparing any written communication or delivering such
communication through the mail or other means that do not involve oral
solicitation of a potential purchaser;
(b) responding to inquiries of potential purchasers made in
communications that they initiate; provided however, that the content of
his responses are limited to information
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contained in a registration statement filed under the Securities Act of
1933 or other offering document; and
(c) performing ministerial and clerical work involved in effecting any
transaction.
As of the date of this prospectus, we have not retained a broker in
connection with the sale of securities in this offering. In the event we
retained a broker who may be deemed an underwriter, we will file an amendment to
our registration statement with the Securities and Exchange Commission.
Neither we nor anyone acting on our behalf, including the company's
shareholder, officer, director, promoters, affiliates or associates will
approach a market maker or take any steps to request or encourage a market in
these securities either prior or subsequent to an acquisition of any business
opportunity. Neither we nor anyone acting on our behalf has had preliminary
discussions or understandings with any market maker regarding the participation
of any such market maker in the future trading market for the company's
securities. We do not have any plans to engage in such discussions, and we do
not intend to use consultants to obtain market makers. No member of management,
promoter or anyone acting at their direction will recommend, encourage or advise
investors to open brokerage accounts with any broker-dealer who is obtained to
make a market in our shares subsequent to the acquisition of any business
opportunity. Our investors will make their own decisions regarding whether to
hold or sell their shares. We will not exercise any influence over such
decisions.
Method of Subscribing
You may subscribe by filling in and signing a subscription agreement and
delivering it to us before the expiration date. The subscription price of $1.00
per share must be paid in cash or by check, bank draft or postal express money
order payable in United States dollars to the order of "Montana Acquisition
Corporation." This offering is being made on a "best efforts basis."
The company's sole principal and any of his affiliates or associates may
purchase a portion of the shares offered in this offering. The aggregate number
of shares which may be purchased by such persons shall not exceed 20% of the
number of shares sold in this offering. Shares purchased by the company's
officer, director and principal shareholder will be acquired for investment
purposes and not with a view towards distribution.
EXPIRATION DATE
This offering will expire 180 days from the date of this prospectus.
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LITIGATION
We are not presently a party to any litigation, nor to the knowledge of
management is any litigation threatened against us which may materially affect
the company.
LEGAL OPINIONS
Whiteman Osterman & Hanna, One Commerce Plaza, Albany, New York 12260, our
special counsel, has rendered an opinion that the shares are validly issued and
non-assessable.
EXPERTS
Our balance sheet as of July 18, 2000, and the related statements of
operations, changes in stockholders' deficit and cash flows for the initial
period from June 6, 2000 through July 18, 2000 have been audited by Arthur Place
& Company, P.C., 1218 Central Avenue, Albany, New York 12205, independent
auditors. They are included in reliance upon the reports of such firm given upon
their authority as experts in accounting and auditing.
FURTHER INFORMATION
We have filed with the Securities and Exchange Commission, a registration
statement on Form SB-2 with respect to the securities offered by this
prospectus. This prospectus omits certain information contained in the
registration statement as permitted by the rules and regulations of the SEC.
Reports and other information that we file may be inspected and copied at the
public reference facilities of the SEC in Washington, D.C. Copies can be
obtained from the Public Reference Section of the Commission, Washington, D.C.
20549 at a prescribed rate or at the Commission's web site, www.sec.gov.
Statements contained in this prospectus as to the contents of any contract or
other document referred to are not complete and where such contract or other
document is an exhibit to the registration statement, each such statement is
deemed qualified and amplified in all respects by the provisions of the exhibit.
FINANCIAL STATEMENTS
Balance Sheet at July 18, 2000
Statement of Changes in Stockholders' Equity for the Period June 6, 2000
Through July 18, 2000
Statement of Income for the Period June 6, 20000 Through July 18, 2000
Notes to Financial Statements
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MONTANA ACQUISITION CORPORATION
(A Development Stage Company)
BALANCE SHEET AS OF JULY 18, 2000
ASSETS
Current Assets:
Cash ................................................... $ 2,500
-------
TOTAL ASSETS ......................................... $ 2,500
=======
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities:
Accounts Payable ....................................... $ 436
-------
Total Liabilities .................................... 436
STOCKHOLDERS' EQUITY
Common Stock - Par Value $.001 per share;
50,000 Shares Authorized; 25,000 Shares
Issued and Outstanding ................................. 25
Additional Paid-In Capital ............................... 2,475
Accumulated Deficit, incurred during the
Development Stage ...................................... (436)
-------
Total Stockholders' Equity ........................... 2,064
-------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ........... $ 2,500
=======
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MONTANA ACQUISITION CORPORATION
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE PERIOD JUNE 6, 2000 THROUGH JULY 18, 2000
Additional
Common Paid-In Accumulated
Stock Capital Deficit Total
----- ------- ------- -----
Balance - June 6, 2000 $ -0- $ -0- $ -0- $ -0-
Common Stock Issued 25 2,475 -- 2,500
Net (Loss) -- -- (436) (436)
------- ------- ------- -------
Balance July 18, 2000 $ 25 $ 2,475 $ (436) $ 2,064
======= ======= ======= =======
MONTANA ACQUISITION CORPORATION
(A Development Stage Company)
STATEMENT OF INCOME FOR THE PERIOD
JUNE 6, 2000 THROUGH JULY 18, 2000
Revenue ................................................. $ -0-
Operating Costs
Legal Expense ......................................... (436)
-----
NET (LOSS) ............................................ $(436)
=====
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MONTANA ACQUISITION CORPORATION
(A Development Stage Company)
STATEMENT OF CASH FLOWS FOR THE PERIOD
JUNE 6, 2000 THROUGH JULY 18, 2000
Cash Flows From Operating Activities:
Net (Loss) ..................................... $ (436)
Adjustments to Reconcile Net Income to Net
Cash Provided by (Used by) Operating Activities:
Increase in Accounts Payable ................. 436
-------
Net Cash (Used By)
Operating Activities ....................... -0-
Cash Flows From Financing Activities:
Capital Contributions .......................... 2,500
-------
Net Cash Provided by Financing Activities .... 2,500
-------
Net Increase in Cash ........................... 2,500
Beginning Bank Balance ......................... -0-
-------
Ending Bank Balance .......................... $ 2,500
=======
Supplemental Disclosure:
Cash is defined as cash in savings account.
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MONTANA ACQUISITION CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOTE 1: Summary of Significant Accounting Policies:
Organization Information - The company was organized for the purpose of
creating a corporate vehicle to seek, investigate, and, if such investigation
warrants, engaging in business combinations presented to it by persons or firms
who desire to employ the company's funds in their business or to seek the
perceived advantages of a publicly-held corporation.
The company was incorporated on June 6, 2000. As the company is in its
development stage, operations are devoted to organizing the business and
activities associated with its preparation for filing a registration statement
and prospectus for its initial public offering.
We have not engaged in any preliminary efforts intended to identify
possible business combinations and has neither conducted registrations
concerning, nor entered into a letter of intent concerning any such target
business.
The company's initial public offering will comprise of 10,000 shares of
common stock at a purchase price of $1.00 per share. The company is filing a
registration statement in order to effect a public offering for its securities.
Use of Estimates - The presentation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statement and the reported amounts of revenues and expenses during
the reporting period. Actual results could differ from those estimates.
Cash - The company maintains its cash balance in a national bank. The
balance is insured by the Federal Deposit Insurance Corporation up to $100,000.
There are no balances in excess of insured amounts at July 18, 2000.
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INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24. Indemnification of Directors and Officers
The Delaware General Corporation Law, as amended, provides for the
indemnification of the company's officers, directors and corporate employees and
agents under certain circumstances as follows:
INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS; INSURANCE. --
(a) A corporation shall have power to 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 the person 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 the person in connection with such action, suit or proceeding if the
person acted in good faith and in a manner the person 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 the
person's conduct was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the person did
not act in good faith and in a manner which the person 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 reasonable cause to believe the person's
conduct was unlawful.
(b) A corporation shall have power to 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 the person 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) actually and reasonably incurred by
the person in connection with the defense or settlement of such action or suit
if the person acted in good faith and in a manner the person reasonably believed
to be in or not opposed to the best interests of the corporation and except that
no indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Court of Chancery or the court in which
such action or suit was brought shall determine upon application that, despite
the adjudication of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such court shall deem proper.
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(c) To the extent that a present or former director or officer 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
section, or in defense of any claim, issue or matter therein, such person shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as authorized
in the specific case upon a determination that indemnification of the present or
former director, officer, employee or agent is proper in the circumstances
because the person has met the applicable standard of conduct set forth in
subsections (a) and (b) of this section. Such determination shall be made, with
respect to a person who is a director or officer at the time of such
determination, (1) by a majority vote of the directors who are not parties to
such action, suit or proceeding, even though less than a quorum, or (2) by a
committee of such directors designated by majority vote of such directors, even
though less than a quorum, or (3) if there are no such directors, or if such
directors so direct, by independent legal counsel in a written opinion, or (4)
by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an officer or director
in defending any civil, criminal, administrative or investigative action, suit
or proceeding may be paid by the corporation in advance of the final disposition
of such action, suit or proceeding upon receipt of an undertaking by or on
behalf of such director or officer to repay such amount if it shall ultimately
be determined that such person is not entitled to be indemnified by the
corporation as authorized in this section. Such expenses (including attorneys'
fees) incurred by former directors and officers or other employees and agents
may be so paid upon such terms and conditions, if any, as the corporation deems
appropriate.
(f) The indemnification and advancement expenses provided by, or granted
pursuant to, the other subsections of this section shall not be deemed exclusive
of any other rights to which those seeking indemnification or advancement
expenses may be entitled under any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in such person's
official capacity and as to action in another capacity while holding such
office.
(g) A corporation shall have power to purchase and maintain insurance on
behalf of any person who is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted against such
person and incurred by such person in any such capacity or arising out of such
person's status as such, whether or not the corporation would have the power to
indemnify him against such liability under this section.
(h) For purposes of this section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) or absorbed in a consolidation of
merger which, if its separate existence had continued, would have had
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power and authority to indemnify its directors, officers and employees or
agents, so that any person who is or was a director, officer, employee or agent
of such constituent corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall stand
in the same position under this section with respect to the resulting or
surviving corporation as such person would have with respect to such constituent
corporation as if its separate existence had continued.
(i) For purposes of this section, references to "other enterprises" shall
include employee benefit plans; references to "fines" shall include any excise
taxes assessed on a person with respect to an employee benefit plan; and
references to "serving at the request of the corporation" shall include any
service as a director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer, employee, or
agent with respect to an employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a manner such person
reasonably believed to be in the interest of the participants and beneficiaries
of an employee benefit plan shall be deemed to have acted in a manner "not
opposed to the best interests of the corporation" as referred to in this
section.
(j) The indemnification and advancement of expenses provided by, or granted
pursuant to, this section shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a director, officer,
employee or agent and shall inure to the benefit of the heirs, executors, and
administrators of such person.
(k) The Court of Chancery is hereby vested with exclusive jurisdiction to
hear and determine all actions for advancement of expenses or indemnification
brought under this section or under any bylaw, agreement, vote of stockholders
or disinterested directors, or otherwise. The Court of Chancery may summarily
determine a corporation's obligation to advance expenses (including attorneys'
fees).
Article 7 of the company's By-laws provides for the indemnification of the
company's officers, directors, and corporate employees and agents under certain
circumstances as follows:
The corporation shall, to the fullest extent permitted by Section 145 of
the General Corporation Law of the State of Delaware, as the same may be
amended and supplemented, indemnify any and all persons whom it shall have
power to indemnify under said section from and against any and all of the
expenses, liabilities, or other matters referred to in or covered by said
section, and the indemnification provided for herein shall not be deemed
exclusive of any other rights to which those indemnified may be entitled
under any by-law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office, and shall continue
as to a person
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who has ceased to be a director, officer, employee, or agent and shall
inure to the benefit of the heirs, executors, and administrators of such a
person.
Item 25. Expenses of Issuance and Distribution
The expenses payable by the Registrant in connection with the issuance and
distribution of the securities being registered are estimated as follows:
Escrow Fee $ 1,000.00
Securities and Exchange
Commission Registration Fee $ 2.64
Legal Fees $ 5,000.00
Accounting Fees $ 1,000.00
Printing and Engraving $ 100.00
Blue Sky Qualification
Fees and Expenses $ 350.00
Miscellaneous $ 1,000.00
Transfer Agent Fee $ 0
TOTAL $ 8,452.64
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Item 26. Recent sales of unregistered securities.
During the past year, the registrant has sold securities in the manner set
forth below without registration under the Securities Act of 1937. On or about
June 30, 2000, the company raised $2,500.00 through the sale of 25,000 shares of
common stock at a price of $.01 per share as follows:
Name and Address of Shares of Date Amount
Beneficial Owner Common Stock Purchased Paid
Leslie M. Apple 25,000 June 30, 2000 $2,500
6 Greyledge Drive
Loudonville, New York 12211
The shares listed above were issued to the company's founder, an accredited
investor, in connection with the company's organization. This transaction was
not registered under the Securities Act in reliance on the exemption from
registration in Section 4(2) of the Act, as a transaction not involving any
public offering.
Item 27. Exhibits.
3.1 Certificate of Incorporation.
3.2 By-Laws.
4.1 Specimen Certificate of Common Stock.
4.6 Form of Escrow Agreement.
4.8 Independent Auditors' Report.
5.0 Opinion of Counsel.
24.0 Accountant's Consent to Use Opinion.
24.1 Counsel's Consent to Use Opinion.
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Item 28. Undertakings.
The registrant undertakes:
(1) To file, during any period in which offers or sales are being made,
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10 (a) (3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the Effective Date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement,
including (but not limited to) any addition or deletion of managing
underwriter;
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be treated as a new
registration statement of the securities offered, and the offering of the
securities at that time to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) To deposit into the Escrow Account at the closing, certificates in such
denominations and registered in such names as required by the company to permit
prompt delivery to each purchaser upon release of such securities from the
Escrow Account in accordance with Rule 419 of Regulation C under the Securities
Act. Pursuant to Rule 419, these certificates shall be deposited into an escrow
account, not to be released until a business combination is consummated.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to any provisions contained in its Certificate of
Incorporation, or by-laws, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
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whether indemnification by it is against public policy as expressed in the
Act and will be governed by the final adjudication of such issue.
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned, in the City of Albany,
State of New York, on November 3, 2000.
Montana Acquisition Corporation
BY: /s/ Leslie M. Apple
---------------------------
Leslie M. Apple
President
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated.
Leslie M. Apple Dated: November 3, 2000
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