COHEN BRAME & SMITH
Professional Corporation
One Norwest Center Suite 1800
1700 Lincoln Street
Denver, Colorado 80203
Telephone (303) 837-8800
Fax (303) 894-0475
May 13, 1998
U.S. Securities and Exchange Commission
Washington, DC 20549
Re: Preliminary Information Statement Lyric Energy, Inc.
SEC File No. 0-9800
Dear Sir or Madam:
Attached hereto please find the company's above-referenced Schedule 14c
Information Statement relating to a special meeting of shareholders called to
accomplish a reverse split and certain amendments to its Articles of
Incorporation. Please call me with any questions or comments you may have.
Very truly yours,
/s/ Roger V. Davidson
Roger V. Davidson
RVD:bmc
Attachment
cc: Mr. Brent Wagman, Chairman of the Board
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of the Securities and Exchange
Act of 1934
Check the appropriate box:
[ ] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
[X] Definitive Information Statement
LYRIC ENERGY, INC.
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing
fee is calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid: _____________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement Number:
3) Filing party:
4) Date filed:
LYRIC ENERGY, INC.
1013 WEST 8TH AVENUE
AMARILLO, TEXAS 79101
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JULY 1, 1998
TO THE SHAREHOLDERS OF LYRIC ENERGY, INC:
Notice is hereby given that a Special Meeting of Shareholders of Lyric
Energy, Inc., a Colorado corporation (the "Company"), will be held at the
Company's offices at 1013 West 8th Avenue in Amarillo, Texas 79101 on July 1,
1998, at 2:00 p.m. local time for the following purposes:
1. To ratify the one share-for-240.597 share (1 for 240.597) reverse
split of the issued and outstanding shares of the Company's $.01
common stock.
2. To consider and act upon the adoption of Articles of Amendment of
the Company's Articles of Incorporation, attached as Exhibit A,
which contain provisions:
a. To authorize 10,000,000 shares of no par value preferred
stock to be reserved for future issuance in the discretion of
the Board of Directors;
b. To eliminate the liability of the Company's Officers and
Directors in certain circumstances;
c. To reduce the voting requirements for certain fundamental
corporate actions; and
d. To reduce the quorum requirement for shareholder meetings
from shares representing a majority of the outstanding voting
rights to shares representing one-third of the outstanding
voting rights on the matters presented.
3. To consider such other business as may properly come before the
meeting.
The Board of Directors has fixed June 3, 1998, at the close of business,
as the record date for the determination of stockholders entitled to notice
of, and to vote at, the Special Meeting or any adjournment thereof.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A
PROXY.
There is printed on the following pages an "Information Statement" to
which your attention is invited.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Brent A. Wagman
__________________________________________
Secretary
May 29, 1998
INFORMATION STATEMENT
LYRIC ENERGY, INC.
1013 WEST 8TH AVENUE
AMARILLO, TEXAS 79101
SPECIAL MEETING OF SHAREHOLDERS TO BE HELD JULY 1, 1998
______________________________________________________________________________
This Information Statement is being furnished to the shareholders of
LYRIC ENERGY, INC., a Colorado corporation (the "Company"), in connection
with the Special Meeting of Shareholders to be held on July 1, 1998 at the
offices of the Company at 2:00 p.m. local time and any and all adjournments
thereof. This Information Statement is first being mailed to the shareholders
of the Company on or about June 5, 1998.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY
VOTING AT MEETING
On June 3, 1998 the record date for determining shareholders entitled to
notice of and to vote at the meeting, there were 250,000,000 shares of $.01
par value common stock ("Common Stock") outstanding. The Company has no other
class of shares outstanding.
A majority in interest of the common shareholders on the record date must
be present, in person or by proxy, at the Meeting to constitute a quorum.
Each share of Common Stock will carry one vote on each of the proposals
described below, as well as on any other matters which may properly come
before the Meeting.
So far as the Company is aware, no matters other than the ones outlined
in this Information Statement will be presented at the Meeting for action on
the part of the shareholders.
The shares beneficially owned by Natural Gas Technologies, Inc. ("NGT")
and G.E. Stahl, President and Director of the Company, which total
approximately 82% of the outstanding shares, will be voted in favor of each of
the proposals described below. Therefore, the proposals will be approved by
the requisite number of shares. Approval of the proposed amendments to the
Company's Articles of Incorporation, including the authorization of preferred
stock, requires the affirmative vote of two-thirds of all issued and
outstanding shares of Common Stock. Approval of the reverse split requires
the affirmative vote of a majority of all votes present at the Meeting in
person or by proxy, provided that a quorum is established at the Meeting.
Abstentions and broker non-votes will be treated as negative votes.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of May 12, 1998, the Common Stock
ownership of each person known by the Company to be the beneficial owner of
five percent or more of the Company's Common Stock, all Directors and Officers
individually and all Directors and Officers of the Company as a group. Except
as noted, each person has sole voting and investment power with respect to
their shares shown. There are no contractual arrangements or pledges of the
Company's securities, known to the Company, which may at a subsequent date
result in a change of control of the Company.
<TABLE>
<CAPTION>
Shares
Name and Address of Beneficially % Beneficial Ownership of
Beneficial Owner Owned (1) Outstanding Common Shares (2)
<S> <C> <C>
Brent A. Wagman 203,041,517(3) 81%
Chairman of the Board
16775 Addison Road
Suite 300
Dallas, TX 75248
Warren Donohue 0 -
Director
16775 Addison Road
Suite 300
Dallas, TX 75248
G. E. Stahl 3,577,402 1%
President, Director
1013 West 8th Avenue
Amarillo, TX 79101
All Officers and 206,618,919 82.6%
Directors as a
Group (three persons)
</TABLE>
__________________________
(1) Rule 13d-3 under the Exchange Act, involving the determination of
beneficial owners of securities, includes as beneficial owners of securities,
among others, any person who directly or indirectly, through any contract,
arrangement, understanding, relationship or otherwise has, or shares, voting
power and/or investment power with respect to such securities; and, any person
who has the right to acquire beneficial ownership of such security within
sixty days through means, including but not limited to, the exercise of any
option, warrant or conversion of a security. The Company has no options or
warrants outstanding.
(2) Based upon 250,000,000 shares issued and outstanding prior to the
Reverse Split described herein.
PROPOSALS BEING CONSIDERED
1. REVERSE STOCK SPLIT
The Board of Directors of the Company believes it advisable and in the best
interests of the Company to declare a one share for 240.597 share reverse
stock split (the "Reverse Split") of the Company's $.01 par value common stock
("Common Stock"). As a result of the Reverse Split, the currently outstanding
250,000,000 shares of the Company will be converted into 1,039,082 shares,
subject to increases due to rounding as described below. The 250,000,000
shares of Common Stock authorized in the Company's Articles of Incorporation
will remain the same.
The Reverse Split is recommended in order to set up the Company's capital
structure so that it is an attractive and ready candidate to acquire the
business of shares of an operating company in exchange for the Company's
stock.
The principal effect of the Reverse Split will be the decrease of the number
of issued and outstanding shares of Common Stock from 250,000,000 to
approximately 1,039,082. The Common Stock outstanding as a result of the
Reverse Split will be fully paid and nonassessable. The voting rights and
other rights that accompany the Common Stock prior to the Reverse Split will
not be altered by the Reverse Split.
After the effective date of the Reverse Split, the certificates currently
representing issued and outstanding shares of Common Stock will be deemed to
represent the number of shares of Common Stock equal to .004156328 (1 divided
by 240.597) times the number of shares of Common Stock shown on the
certificate. New shares of Common Stock will be issued in due course as old
shares are tendered to the transfer agent for exchange or transfer.
Fractional shares of post-split Common Stock which result from the Reverse
Split will be rounded up to the next whole share.
Shareholders are not required to exchange their certificate(s) of pre-split
Common Stock for post-split Common Stock. Shareholders may, however, exchange
their certificates for shares of post-split Common Stock by surrendering their
old certificates representing shares of pre-split Common Stock to the
Company's transfer agent. Upon surrender to the transfer agent of the share
certificate(s) representing shares of pre-split Common Stock and the
applicable transfer fee, which presently is $15.00 per certificate, the holder
will receive a share certificate representing the appropriate number of shares
of post-split Common Stock.
The Reverse Split is hoped to facilitate the Company's anticipated application
for listing on either the Nasdaq SmallCap Market ("Nasdaq") or the American
Stock Exchange ("AMEX") once it is able to locate an acquisition. Trading on
Nasdaq or AMEX is desirable for a number of reasons, including the likelihood
of generating interest in the Company's Common Stock by more investors and
securities brokers and better access to equity capital. The initial listing
requirements for Nasdaq include:
1. $4,000,000 in net tangible assets. Net tangible assets are total
assets exclusive of goodwill minus total liabilities.
2. At least 300 round lot shareholders and at least 1,000,000 shares
held by persons other than Officers, Directors and ten percent
shareholders (the "public float").
3. A minimum bid price of $4.00 and a market value of at least
$5,000,000 for the public float.
4. A minimum of three market makers.
The initial listing requirements for AMEX will require:
1. $4,000,000 in shareholders' equity.
2. At least 400 shareholders and at least 1,000,000 shares held by
persons other than Officers, Directors and five percent
shareholders (the "public float").
3. A minimum market price of $3.00 per share.
4. A market value of at least $15,000,000 for the public float, or
$750,000 in pre-tax income for the latest fiscal year.
As of May 12, 1998, the Company did not meet the net assets requirement for
Nasdaq or the shareholders' equity requirement for AMEX and even if the
Company completes an acquisition there can be no guarantee that it will meet
these listing criteria. The Company also does not currently meet the round
lot shareholder requirement for Nasdaq, although it does meet AMEX's
shareholder requirement. Additionally, the Company does not currently meet
the alternative AMEX requirement of $750,000 in pre-tax income for the latest
fiscal year and it will therefore have to rely upon the market value of public
float alternative. Finally, there can be no assurance that the price of the
Company's Common Stock will be sufficient to meet the respective bid price,
market price or market value of public float requirements. In the event the
Company cannot qualify for Nasdaq or AMEX, management intends to seek a market
maker for trading and quotation on the OTC Bulletin Board until such time as
it can qualify for Nasdaq or AMEX.
The following table illustrates the effects of the proposed Reverse Split on
the authorized and outstanding number of shares of Common Stock.
<TABLE>
<CAPTION>
Number of Shares Prior to After
of Common Stock Reverse Split Reverse Split
<S> <C> <C>
Authorized 250,000,000 250,000,000
Outstanding 250,000,000 1,039,082(1)
Treasury 0 0
Reserved 0 0
Available for
Future Issuance 0 248,960,918
Percent of
Authorized
Available for
Future Issuance 0% 99.6%
</TABLE>
(1) Does not include additional shares which will be issued as a result of
rounding. It is estimated that approximately 2,000 additional shares
will be outstanding as a result of such rounding.
Approval of the Reverse Split requires the affirmative vote of a majority of
all votes present at the Meeting in person or by proxy, provided that a quorum
is established at the Meeting.
2. AMENDMENTS TO THE ARTICLES OF INCORPORATION OF THE COMPANY
The Board of Directors believes it advisable and in the best interests of the
Company and its shareholders to amend its Articles of Incorporation (i) to
authorize 10,000,000 shares of no par value Preferred Stock to be reserved for
future issuance in the discretion of the Board of Directors; (ii) to eliminate
the personal liability of the Company's Directors and Officers to the Company
and its shareholders for monetary damages as a result of certain breaches of
fiduciary duty pursuant to the Colorado Business Corporation Act; (iii) to
reduce the voting requirement for certain fundamental corporate actions
pursuant to the Colorado Business Corporation Act; and (iv) to reduce the
quorum requirement. The full text of the foregoing amendments is set forth in
Exhibit A attached to this Information Statement. Approval of the proposed
amendments requires the affirmative vote of two-thirds of all issued and
outstanding shares of Common Stock.
A. AUTHORIZATION OF PREFERRED STOCK
The Board of Directors has recommended that the Articles of Incorporation be
amended to authorize 10,000,000 shares of no par value preferred stock. The
purpose of this amendment is to add flexibility to the Company's ability meet
its future capital needs. The Company has no current plans to issue shares of
preferred stock. The shares of authorized preferred stock may be issued from
time to time in one or more series and each such series will have such
designations, rates of dividend, redemption prices, voting rights, liquidation
preferences, sinking fund provisions, conversion or exchange rights and other
special rights as the Board of Directors may fix prior to the time of issuance
of such series. The Board of Directors will be empowered to authorize the
Company to issue some or all of the preferred stock at such time or times, to
such persons and for such consideration as it may deem desirable without a
further vote of the stockholders and without offering such preferred stock to
the holders of the Common Stock of the Company. If shares of preferred stock
are issued, the interests of the holders of Common Stock could be diluted with
respect to earnings per share, liquidation rights, net asset value per share
and market value per share.
B. EXONERATION OF OFFICERS AND DIRECTORS
The Colorado Business Corporation Act (the "BCA") permits a Colorado
corporation to amend its Articles of Incorporation to eliminate or limit the
personal liability of Directors and Officers to the corporation or its
shareholders for damages for breach of fiduciary duty as a Director or
Officer. No such amendment may, however, eliminate or limit the liability of
a Director or Officer for (i) any breach of the Director's or Officer's duty
of loyalty to the corporation or to its shareholders; (ii) acts or omissions
not in good faith or which involve intentional misconduct or a knowing
violation of law; (iii) the payment of distributions in violation of Section
7-108-403 of the BCA or (iv) any transaction from which the Director or
Officer directly or indirectly derived an improper personal benefit. The
elimination of liability also does not apply to any acts or omissions
occurring prior to the date when such provision becomes effective.
The Board of Directors has recommended this proposal in response to (i) the
increasing hazard of litigation and its related expenses directed against
Directors and Officers; (ii) the general difficulty of obtaining Directors'
and Officers' liability insurance; (iii) the dramatic increases in premiums
for such insurance coverage and (iv) the potential inability to continue to
attract and retain qualified Directors and Officers in light of these
circumstances. Although none of the Company's current Directors or Officers
have indicated that they will no longer serve absent changes to its Articles
of Incorporation, the Company is concerned that it may encounter difficulty in
attracting qualified individuals to serve as Directors or Officers, a concern
the Company believes it shares with many other companies. In order to ensure
that the Company will be able to attract and retain experienced individuals to
serve as Directors and Officers, and as a matter of fairness, the Board of
Directors believes that the Company should provide the maximum possible
protection to its Directors and Officers consistent with applicable law.
In general, in performing their duties, Directors and Officers of a Colorado
corporation are obligated as fiduciaries to exercise their business judgment
and act in what they determine in good faith, after appropriate consideration,
to be in the best interests of the corporation and its shareholders.
Decisions made on that basis are ordinarily protected by the so-called
"business judgment rule" from being second guessed by a court in a lawsuit
challenging such decisions. The business judgment rule is thus meant to
protect Directors and Officers from personal liability to the corporation or
its shareholders when their business decisions are subsequently challenged.
However, for various reasons, including the expense of defending lawsuits, the
frequency with which unwarranted litigation is brought against Directors and
Officers and the inevitable uncertainties with respect to the outcome of
applying the business judgment rule to particular facts and circumstances,
Directors and Officers often rely for protection, as a practical matter, on
insurance procured by the corporation they serve.
Recent changes in the market for Directors' and Officers' liability insurance
have resulted in the unavailability for Directors and Officers of many
corporations of any meaningful liability insurance coverage. Insurance
carriers have in certain cases declined to renew existing Directors' and
Officers' liability policies, or have increased premiums to such an extent
that the cost of obtaining such insurance becomes prohibitive. Moreover,
current policies often exclude coverage for areas where the service of
qualified independent Directors and Officers is most needed. These
limitations on the scope of insurance coverage, along with high deductibles
and low limits of liability, have tended to undermine meaningful Directors and
Officers' liability insurance coverage. The Company does not currently carry
Directors' and Officers' liability insurance coverage. The premium rates for
such insurance coverage are currently cost-prohibitive for the Company.
Without the amendment to the Company's Articles of Incorporation, the
Company's Directors and Officers have a fiduciary duty of care in their
service as Directors and Officers which subjects them to monetary liability to
the Company and its shareholders for breach of the duty of care. The duty of
care requires a Director and Officer to use that amount of care in the
performance of his duties which ordinarily careful and prudent men would use
in similar circumstances. The amendment would have the effect of eliminating
the liability of Directors and Officers of the Company for monetary damages
for breach of fiduciary duty except for (i) any breach of the Director's or
Officer's duty of loyalty to the corporation or to its shareholders; (ii) acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; (iii) the payment of distributions in violation of
Section 7-108-403 of the BCA or (iv) any transaction from which the Director
or Officer directly or indirectly derived an improper personal benefit. The
amendment will not eliminate or limit the right of the Company or any
shareholder to seek an injunction or any other non-monetary relief in the
event of a breach of a Director's or Officer's duty of care. In addition, the
amendment applies only to claims against a Director or Officer arising out of
his or her role as a Director or Officer and many not relieve a Director or
Officer from liability unrelated to his fiduciary duty of care, such as
certain liabilities imposed on the Director or Officer under the federal
securities laws.
The Board of Directors acknowledges that current and future Directors and
Officers could benefit from the approval of the foregoing amendment and, in
this connection, the Directors and Officers may be considered to have a
conflict of interest and have a personal interest in approval of the amendment
at the potential expense of the shareholders of the Company.
The Company's Directors and Officers have no insurance coverage for derivative
claims or third party claims. The Company's Directors and Officers may be
forced to personally absorb the liabilities and expenses of future derivative
and third party claims. Alternatively, in certain instances, the Directors
and Officers may obtain some protection under the Company's obligations under
Colorado law and the Company's Articles of Incorporation and Bylaws to
indemnify them with respect to these liabilities and expenses. The Company's
indemnification obligation, however, will not necessarily absorb all
liabilities and expenses to which the Directors and Officers may be exposed.
Corporate indemnification is not an adequate substitute for liability
insurance because the Directors and Officers cannot be assured that the
Company's financial circumstances will always enable the Company to provide
indemnification.
The amendment is not being proposed in response to any resignation, threatened
resignation or refusal to serve by any Director or Officer of the Company or
by any person the Company desires to serve as a Director or Officer.
Moreover, management is unaware of any pending or threatened litigation
against any Director or Officer wherein a claim is made for breach of
fiduciary duty.
C. REDUCTION IN VOTING REQUIREMENTS
The BCA provides that for corporations in existence on June 30, 1994, unless
otherwise provided in the corporation's articles of incorporation, the vote of
two-thirds of all the votes entitled to be cast by each voting group are
required to approve (i) amendments to the corporation's articles of
incorporation; (ii) a plan of merger or share exchange; (iii) sale, lease,
exchange or other disposition of all or substantially all of the property of a
corporation otherwise than in the usual and regular course of business or (iv)
the dissolution of a corporation or the revocation of a dissolution. A
corporation such as the Company in existence prior to June 30, 1994 and which
has only a single voting group consisting of all of the common shareholders
requires the vote of two-thirds of all issued and outstanding shares for any
of the foregoing matters unless the articles of incorporation provide that the
voting requirements for such corporation shall be the same as for corporations
formed on or after July 1, 1994.
The Board of Directors has proposed to adopt an amendment to the Articles of
Incorporation which reduces the voting requirement for the foregoing corporate
actions to that which would be required to take the action if the action were
to be taken by a corporation formed on or after July 1, 1994. Following
adoption of this amendment, approval of each of the above corporate actions
will require the following votes:
Action Vote Required for Approval
________ _____________________________
Amendment to the Company's Votes cast for matter exceed the votes
Articles of Incorporation cast against the matter at a meeting at
which a quorum is present.
Plan of merger or share Majority of all votes entitled to be cast.
exchange.
Sale, lease, exchange or Majority of all votes entitled to be cast.
other disposition of all
or substantially all of the
property of the Company.
Dissolution or revocation of Majority of all votes entitled to be cast.
dissolution
The Board of Directors believes that it is in the best interests of the
Company to reduce the voting requirement to the votes indicated above so that
a minority of the Company's shareholders, through inaction or otherwise, will
not be able thwart the will of the majority. The Board of Directors believes
that reduction of the voting requirement will (i) give the Company more
flexibility to adapt its business structure to changing needs and business
strategies over time and (ii) reduce the time and costs associated with proxy
solicitation. Other than as described in this Information Statement, the
Board of Directors has no plans at this time to recommend any of the actions
for which the voting requirement is being reduced.
D. REDUCTION OF QUORUM REQUIREMENT
At the present time, the Company's Articles of Incorporation require that at
least a majority of the number of shares entitled to vote at a meeting be
present in person or by proxy to constitute a quorum. The Board of Directors
has recommended that the quorum requirement be reduced to one-third of those
shares entitled to vote at a meeting in order to simplify the process of
carrying on business that requires shareholder approval. The one-third quorum
requirement is the standard established by the corporate governance
requirements of the Nasdaq and AMEX stock markets. It is also the minimum
required under Colorado law. Reducing the quorum would simplify the election
process and reduce the cost to the Company of holding shareholder meetings as
it should eliminate the need to a large extent for hiring proxy solicitation
firms to assist the Company in obtaining proxy responses. Reducing the quorum
requirement could have the effect of allowing a minority of the total
outstanding votes to approve a corporate action, although all shareholders
will be given an opportunity to vote on all corporate actions.
FURTHER INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, and in accordance therewith files reports and
other information with the Securities and Exchange Commission. Certain
information is periodically contained in various reports filed with the
Securities and Exchange Commission by the Company, and is also disclosed in
proxy statements distributed to shareholders of the Company and filed with the
Commission. Such proxy statements, reports and other information concerning
the Company can be inspected at the public records facilities maintained by
the Commission in Denver, Colorado, Washington, D.C., New York, New York,
Chicago, Illinois, and Los Angeles, California. Copies of such material can
be obtained from the Commission, at prescribed rates, by writing to the
Commission at 500 North Capital Street, N.W., Washington, D.C. 20549.
In conformance with its information requirements under the 1934 Act, the
Company has filed this Information Statement with the Securities and Exchange
Commission. Form 10-KSB for the period ended April 30, 1997 filed with the
Commission in August 1997 contains financial statements, management's
discussion and analysis of financial condition and results of operations,
biographical information and other information which the Company believes is
unrelated to voting on the proposals herein.
MEETING PROCEDURES
The minute book, Bylaws and Articles of Incorporation will be open to
inspection before, during, and after the meeting. The Company's auditor and
transfer agent will not send representatives to the meeting. The meeting will
be conducted by the Company's management with assistance and participation of
shareholders in attendance, if any. Tally of voting on proposals will be done
by management and witnessed by an inspector selected at random from those in
attendance and duly sworn to oath.
The meeting shall be called to order by the Chairman and the Secretary
shall read the Notice. The Secretary will present the certified shareholder
list as of the record date. The affidavit of mailing of Notice shall be
displayed. The shares present will be polled by management and witnessed by
the inspector to determine a quorum. If a quorum is present, the meeting will
be declared lawfully and properly convened.
The Chairman will present the proposals and after discussion or
questions, if any, a resolution will be entertained, seconded and a vote taken
on each. The inspector will tally votes for and against each proposal and the
Chairman will announce the results. The Company will retain the inspector's
worksheets for each vote and file any approved Articles of Amendment to the
Articles of Incorporation with the Colorado Secretary of State.
BY ORDER OF THE BOARD OF DIRECTORS
May 29, 1998 /s/ Brent A. Wagman
____________________________________________
Chairman
EXHIBIT A
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF LYRIC ENERGY, INC.
Pursuant to the provisions of the Colorado Business Corporation Act,
the undersigned corporation adopts the following Articles of Amendment to its
Articles of Incorporation:
Article IV shall be deleted in its entirety and substituted with the
following:
ARTICLE IV
Capital Stock
The aggregate number of shares which this corporation shall have
authority to issue is two hundred fifty million (250,000,000) shares of $.01
par common stock ("Common Stock") and ten million (10,000,000) share of no par
value preferred stock ("Preferred Stock").
1. Preferred Stock.
All shares of Preferred Stock may be issued from time to time in one or
more series and for such consideration as the Board of Directors shall
determine. Subject to the limitations set forth herein and any limitations
then prescribed by law, authority is hereby expressly granted to the Board of
Directors to fix by resolution from time to time the designation of such
series and the powers, preferences and rights of the shares of such series,
and the qualifications, limitations or restrictions thereof, including,
without limitation, the following:
(a) the designation and number of shares comprising such series,
which number may from time to time be decreased by the Board of Directors (but
not below the number of such shares then outstanding) or may be increased
(unless prohibited by action of the Board of Directors in resolutions creating
such series);
(b) the rate, amount and times at which, and the preferences and
conditions under which, dividends shall be payable on shares of such series,
including, without limitation, whether such dividends are cumulative or
noncumulative and whether the shares of such series participate or do not
participate in additional dividends after the payment of preferential
dividends with respect to such shares;
(c) any rights and preferences of the holders of shares of such
series upon the liquidation, dissolution or winding up of the affairs of, or
upon any distribution of the assets of, the corporation, and whether such
amounts vary depending upon whether such liquidation, dissolution or winding
up is voluntary or involuntary;
(d) the full or limited voting rights, if any, of the shares of
any such series, in addition to voting rights provided by law; and whether or
not, under what conditions and with respect to what subject matters, the
shares of such series shall be entitled to vote separately as a class;
(e) any times, terms and conditions upon which the shares of
such series may be subject to redemption and the amount, terms, conditions and
manner of operation of any purchase, retirement or sinking fund to be provided
with respect to the redemption of such shares;
(f) any rights to convert such shares into, or to exchange such
shares for, shares of any other class or classes or of any other series of the
same class, including, without limitation, the prices, rates, conversion or
exchange and any other terms or conditions applicable to such conversion or
exchange;
(g) any limitations upon the payment of dividends or the making
of distributions on or the acquisition or redemption of common stock of any
other class of shares subordinate to the shares of such series with respect to
the payment of dividends;
(h) any conditions or restrictions upon the issue of any
additional shares on a parity with or superior to the shares of such series;
and
(i) any other relative powers, preferences or rights and any
other qualifications, limitations or restrictions with respect to the shares
of such series as the Board of Directors may deem advisable and as shall not
be inconsistent with the provisions hereof.
2. Common Stock
(a) Dividends. Dividends in cash, property or shares of the
corporation may be paid upon the Common Stock, as and when declared by the
Board of Directors, out of funds of the corporation to the extent and in the
manner permitted by law.
(b) Distribution in Liquidation. Upon any liquidation,
dissolution or winding up of the corporation, and after paying or adequately
providing for the payment of all its obligations, and subject to the rights
and preferences of any outstanding Preferred Stock, the remainder of the
assets of the corporation shall be distributed, either in cash or in kind, pro
rata to the holders of the Common Stock.
(c) Voting Rights; Cumulative Voting. Each outstanding share of
Common Stock shall be entitled to one vote and each fractional share of Common
Stock shall be entitled to a corresponding fractional vote on each matter
submitted to a vote of shareholders. Cumulative voting shall not be allowed
in the election of Directors of the corporation.
(d) Denial of Preemptive Rights. No holder of any shares of
Common Stock of the corporation, whether now or hereafter authorized, shall
have any preemptive or preferential right to acquire any shares or securities
of the corporation, including shares or securities held in the treasury of the
corporation.
Article VIII shall be deleted in its entirety and substituted with the
following:
ARTICLE VIII
Quorum
At all meetings of shareholders, one-third of the shares of a voting
group entitled to vote at such meeting, represented in person or by proxy,
shall constitute a quorum of that voting group.
Article XIII shall be added in its entirety as follows:.
ARTICLE XIII
Limitation of Liability for Directors and Officers
No Director or Officer of the corporation shall have any personal
liability to the corporation or its shareholders for monetary damages for
breach of fiduciary duty as a Director or Officer; provided that Directors and
Officers shall not be exonerated from liability for monetary damages for (a)
any breach of the Director's or Officer's duty of loyalty to the corporation
or to its shareholders; (b) acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law; (c) the payment
of distributions in violation of section 7-108-403 of the Colorado Business
Corporation Act or (d) any transaction from which the Director or Officer
directly or indirectly derived an improper personal benefit.
Article XIV shall be added in its entirety as follows.
ARTICLE XIV
Certain Voting Requirements
With respect to any action to be taken by shareholders of this
corporation which pursuant to the Business Corporation Act requires the vote
of two-thirds of the outstanding shares of each voting group entitled to vote
thereon as a result of the corporation having been in existence on June 30,
1994, the vote required to approve such action shall be the same as the vote
which would be required under the Colorado Business Corporation Act to approve
such action if the corporation were formed on or after July 1, 1994.
