As Filed with the Securities and Exchange Commission on November10, 1995.
Registration No.___________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C., 20549
Form S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
Commission file number 0-16734
C.E.C. INDUSTRIES CORP.
(Exact name of registrant as specified in charter)
Nevada 87-0217252
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
23 Cactus Garden Drive #F-60
Henderson, Nevada 89014
(Address of Principal Executive Office) (Zip Code)
C.E.C. INDUSTRIES CORP. 1995 STOCK AWARD PLAN
(Full Title of the Plan)
(702) 436-2500
(Registrant's Telephone Number, Including Area Code)
Donald J. Stoecklein, Esq.
Attorney at Law
23 Cactus Garden Drive, Suite F-60
Henderson, Nevada, 89014 (702) 436-2530
CALCULATION OF REGISTRATION FEE
Title of Amount to Proposed Proposed Amount of
Securities be maximum maximum registrati
to be Registered offering aggregate on Fee
Registered price Per offering
Share *1 Price *1
Common 650,000 $0.44 $286,000 $98.62
Stock $.05
*Estimated solely for the purpose of calulating the registration fee on the
basis of the average bid and ask price of the Common Stock as reflected on
the National Association of Securities Dealers Automated Quotion System on
November 9, 1995.
<PAGE>
PROSPECTUS The date of this Prospectus is November 10, 1995
C.E.C. INDUSTRIES, CORP.
Up to 650,000 Shares of Common Stock
Received by Directors, Officers, Consultants and Employees
Under the Company's Consultant and Employee Stock
Compensation Plan and Reoffered by Means of this Prospectus
Selling shareholders of C.E.C. Industries, Corp., ("Company")
will offer their shares through the over-the-counter market or
through NASDAQ, if the Company's common stock is then included
for quotation on NASDAQ. Selling shareholders, if control
persons, are required to sell their shares in accordance with the
volume limitations of Rule 144 under the Securities Act of 1933,
which limits sales by each selling shareholder in any one month
period to the greater of 1% of the total outstanding common stock
(or approximately 45,463 shares) or the average weekly trading
volume of the Company's common stock during the four calendar
weeks immediately preceding such sale. It is expected that
brokers and dealers effecting transactions will be paid the
normal and customary commissions for market transactions.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION
PASSED ON THE ACCURACY OR THE ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
No person has been authorized by the Company to give any
information or to make any representation other than as contained
in this Prospectus and, if given or made, such information or
representation must not be relied upon as having been authorized
by the Company. Neither the delivery of this Prospectus nor any
distribution of the shares of the Common Stock issuable under the
terms of the Plan shall, under any circumstances, create any
implication that there has been no change in the affairs of the
Company since the date hereof.
This Prospectus does not constitute an offer to sell securities
in any state to any person to whom it is unlawful to make such
offer in such state.
The securities offered hereby involve a high degree of risk. See
"Risk Factors."
<PAGE>
SUMMARY OF PROSPECTUS
This prospectus accompanies reoffers by consultants and
employees of the Company of shares of common stock received
through the Company's Consultant and Employee Compensation Plan.
The Company's principal offices are located at 23 Cactus Garden
Drive, F-60, Henderson, Nevada 89014 telephone number (702) 436-
2500.
ITEM 1. BUSINESS
(a) General
C.E.C. Industries Corp. is a Nevada corporation with
principal and executive offices located at 23 Cactus Garden
Drive, F-60, Henderson, Nevada 89014, telephone (702) 436-2500.
C.E.C. Industries Corp. and it's consolidated subsidiaries are
referred to as either C.E.C. or the "Company." C.E.C. is engaged
in several unrelated businesses through its primary subsidiaries,
Moonridge Development Corp., (real estate development and
construction), Custom Environmental International, (carbon
reactivation technology), and Sterling Travel, (travel
businesses). The Company's current organization was accomplished
through a merger and acquisition program during the fiscal year
ended March 31, 1995, and continuing through the present.
C.E.C. was incorporated as Justheim Petroleum Company in
Nevada in 1952. C.E.C. Management Corp. was merged into Justheim
Petroleum Company effective December 31, 1986, and was renamed
C.E.C. Industries Corp. Prior to the merger, Justheim had
historically engaged in the business of acquiring, holding and
selling oil and gas leaseholds and retaining overriding royalty
rights. C.E.C. Management Corp. primarily was in the business of
engineering consulting and designing and marketing customized
minerals processing systems and equipment. While the Company
continues to receive oil and gas production overriding royalty
income, it is no longer actively engaged in the business of
buying and selling oil and gas leasehold interests. A majority
of these royalty interests were sold near the end of the 1994
fiscal year.
C.E.C.'s primary business had been the manufacture and sale
of minerals processing equipment through its wholly-owned
subsidiary, Custom Equipment Corporation. Custom was a pioneer
in the development of custom gold processing equipment in the
early to mid-1980's, thus, business was very profitable.
However, as gold prices declined after the early 1980's, fewer
gold plants were built, more competitors entered the market, and
Custom's business was negatively impacted. The Company attempted
to use its expertise and know-how to develop the carbon
reactivation furnace technology in the water treatment industry,
but the continued losses in the metallurgical business caused a
capital drain necessitating other measures. Custom Environmental
International became the renamed subsidiary to carry on the
efforts, building a new prototype carbon furnace now being
developed. The metallurgical equipment business was sold in
fiscal year 1991.
In September 1993, the Board of Directors of C.E.C
considered expanding the Company's business into business
opportunities outside of the carbon reactivation furnace
technology business, and thus caused several new directors with
real estate expertise to join the C.E.C. board. The intent being
to develop land owned by the Company in St. George, Utah as well
as other properties to be acquired. A property in Las Vegas was
immediately acquired for cash and convertible preferred stock.
Private financing was arranged to provide the cash necessary for
the purchase. The transaction also provided working capital for
development of the property as well as for further development
and marketing of the carbon technology. The Las Vegas property
is partially being developed for a mini-storage facility with a
three million dollar loan from the Bank of America.
(b) Financial Information About Industry Segments
The Company is currently engaged in three main businesses;
real estate development and construction ("Moonridge"); carbon
reactivation technology ("CEI"); and the travel business
("Sterling Travel"). Information regarding the Company's
reportable business segments is set forth in Item 1(c) and Note 9
to the Consolidated Financial Statements.
<PAGE>
(c) Narrative Description of Business
Moonridge Development Corp.
Operations. The Company's real estate operations are
conducted through the Company's wholly owned subsidiary,
Moonridge Development Corp. ("Moonridge"), a licensed General
Contractor in the State of Nevada. Moonridge is responsible for
the development and/or construction of the following projects:
Mini-Storage Facility - Las Vegas, Nevada. The Company owns
approximately 7.28 acres of property generally described as the
Mission Valley Mini Storage located on Russell Road, contiguous
with U.S. Highway 95, outside the city limits of Las Vegas,
Nevada. The project will consist of 1123 mini storage units
totaling 103,564 square feet of space, in addition to 67 covered
RV and boat storage spaces, and 74 uncovered RV and boat storage
spaces, with projected annual net operating income upon
completion of $682,882, (which includes signage income of
$90,000). On March 31, 1995, the Company entered into a loan
agreement with Bank of America for $3,000,000 to build the
project. Permits were subsequently obtained from the County of
Clark, Nevada, to commence clearing the project in preparation
for construction. The project is anticipated to be completed in
1995.
20.30 Acre Planned Development - Las Vegas, Nevada. The
Company owns approximately 18.83 acres of property contiguous
with its 7.28 acre mini storage facility, located on Russell
Road, contiguous with U.S.Highway 95, outside the city limits of
Las Vegas, Nevada. The remaining 1.47 acres of the property is
under an expired purchase option. Pursuant to the option terms,
the Company would be required to pay $90,000 upon exercise of the
option. This option is currently under renegotiation. The
project is being master planned for a combination of commercial
office space and multi-family units. It is anticipated that the
initial development process may be completed in 1995, and
commencement of construction may occur in 1996.
320 Unit Multi-Family Project to be built - Henderson,
Nevada. In June, 1995, the Company acquired a 24.5% interest in a
320 unit apartment project generally known as Victory Village, in
exchange for 1,200,000 shares of Rule 144 stock. The project is
located in Henderson, Nevada near the intersection of Lake Mead
Blvd. and Boulder Highway. The City of Henderson issued bonds to
facilitate the financing on the project, with HUD, (Department of
Housing and Urban Development) insuring the construction and
permanent loan in the sum of $16,442,400, at 6.38% interest,
amortized over 40 years, paid monthly, which loan was recorded in
June of 1995 against the approximate 17.72 acres. Permits for the
project have been obtained from the City of Henderson, and
grading for the project has commenced. In addition to the
Company's interest in the project, Moonridge will act as the
General Contractor on the project. It is anticipated that the
project will be completed in August of 1996.
Strategy. The Company's near term strategy for Moonridge
Development Corp. is to concentrate its efforts on the
construction of its Mission Valley Mini-Storage facility, and
complete construction of the 320 unit Victory Village project.
Concurrent with the above, the Company intends to complete its
development of the 20 additional acres. In the event additional
development opportunities present themselves, the Company intends
to take advantage of the current economic climate in the Las
Vegas area.
Custom Environmental International.
Operations. Custom Environmental International, ("CEI") is
engaged in the business of development and implementation of a
patented carbon reactivation furnace. In September, 1995, the
Board of Directors approved a plan to "spin-off" the CEI
subsidiary, forming a separate publicly traded company.
<PAGE>
Background of Carbon Reactivation. Granular activated carbon
("GAC") is used in a myriad of cleansing processes, but most
particularly in water, air and industrial fluid purification. It
is also used in removing valuable minerals from chemically-
leached ores. Carbon's unique properties allow it to absorb
chemicals until it is "full" or "spent." Once spent, the GAC is
either disposed of (along with the impurities contained in the
carbon), or regenerated for reuse.
The two primary sources of GAC are: (1) newly manufactured
carbon; and (2) reclaimed carbon from the regeneration or
reactivation process. Regenerated carbon can be up to 65%
cheaper than new GAC.
Current regeneration equipment is expensive to build,
maintain, and operate. Consequently, it is economical only in
large quantity applications, using stationary equipment. Most
regeneration equipment requires that GAC be shipped for
regeneration from the carbon "use" site to the reactivation
processing site, adding to the cost of regeneration.
Management believes the patented regeneration technology
under development by CEI will result in equipment less expensive
to build and operate than current equipment. It should also be
mobile, allowing it to be placed at the "use" site, or used in
specialized, one-time processing applications.
Research and development expenses for the years ended March
31, 1995, March 31, 1994 and March 31, 1993 were $3,358, $13,086
and $0, respectively.
Over the last two years, a prototype of the Company's new
carbon reactivation furnace has been tested at Thiokol
Corporation's plant in Utah. A completely integrated system, to
include automatic controls, feeding, cooling, and controlling
emissions, has been installed and is being tested. Results to
date have been favorable but not without start-up problems.
Permitting with the Utah regulatory agencies is underway to
process other carbons at the facility. The project has taken much
longer than originally expected, but the Company should start to
benefit from these efforts this year.
Pursuant to the terms of the Joint Agreement with Thiokol
Corporation, CEI and Thiokol share 50/50 in all revenues earned
as joint partners.
Marketing. To successfully enter the carbon regeneration
market, the Company's market strategy focused on three elements:
product differentiation, sales strategy, and strategic alliances.
CEI's carbon reactivation furnace is a technology that provides
the basis for strong product differentiation to penetrate the
activated carbon regeneration market. This technology combined
with Thiokol Corporation's production expertise, analytical
laboratory capability, and environmental permitting experience
creates a solid technical basis for providing carbon consumers
low cost regeneration with little risk of contamination from
other sources.
The activated carbon market can be divided into liquid
processing carbons and gas processing carbons. Each of these
general carbon types can be further subdivided into several
market segments; Potable Water Purification, Ground Water
Cleanup, Solvent Recovery, Mining, Food and Beverage Processing,
and Chemical and Pharmaceutical.
Competition. There are at least ten competitors in the
United States carbon regeneration market. These companies range
from small regional, privately held companies to large
multinational corporations. Most of the carbon regeneration
companies offer a wide variety of carbon technology services,
including engineering and equipment design or lease.
Strategy. The Company's strategy for entering the carbon
regeneration market focuses on three elements: product
differentiation, sales strategy, and strategic alliances.
<PAGE>
Product Differentiation. In order to be effective in
entering the market, a carbon regeneration company must be able
to have a low price. The CEI regeneration furnace can provide a
low price by 1) keeping energy consumption low, 2) reducing
carbon losses in the furnace, and 3) keeping labor requirements
low.
Sales. Another key area is identifying and marketing
customers. Entry into the carbon market requires development and
implementation of a selling strategy. This strategy must focus on
finding customers and then providing a value added service at low
cost.
Strategic Alliances. The last key element is to develop
strategic alliances with suppliers. One key area where an
alliance would be required is with carbon supplier industries.
There will always be some loss of carbon in any regeneration
process and consumers will need the appropriate amount of carbon
returned for use. Recent growth of the carbon regeneration
industry has encouraged the entrance of new competitors. These
new competitors are encouraged by the growth in carbon use and
the opportunities available to enter the United States market.
Although the market is still growing and there should be
expansion in the near future, the market will be competitive. To
compete in this market, the newcomer to the market must be able
to provide the carbon consumer with a low cost and effective
service. The newcomer must not only be low in cost, but must
provide a team of experts to address the needs of the carbon
consumer. Thiokol's expertise in production, laboratory analysis,
environmental permitting, and CEI's patented technology can
provide the initial advantage for successful entry into the
carbon regeneration industry. Once firmly established in the
United States, further expansion into other markets throughout
the world is possible.
Other Investments
The Company has written down the value of its 430,320 shares
of Logos International, Inc. which had been acquired in 1991 when
the office building and the majority interest in GLI Industries,
Inc. were sold. Because the quoted per share price of the stock
decreased from over $5.00 bid at the end of the 1993 fiscal year
to $.125 bid at March 31, 1994, the value was written down to
$53,790, realizing a loss of $625,960 in fiscal 1994.
Approximately half of the Logos stock was sold during 1995
resulting in a further loss and write-down of $46,395. The
remaining value on the books is $2,605.
Executive Offices
C.E.C.'s executive offices are located at 23 Cactus Garden
Drive, F-60, Green Valley, Nevada 89014
PATENTS
C.E.C.'s subsidiary, CEI has obtained the following patents
for its low temperature furnaces used in regenerating carbon:
Country Patent No. Date Issued
United States 4,462,870 July 31, 1984
Canada 1,188,508 June 11, 1985
South Africa 83/0862 November 30, 1983
South Africa 88/7882 July 26, 1989
South Africa 91/10649 December 24, 1991
Australia 554231 February 5, 1987
Australia 571378 October 14, 1988
Australia 619511 October 28, 1988
United States 4837423 June 6, 1989
United States 4,988,289 January 1, 1991
United States 5,096,415 March 17, 1992
United States 5,162,275 November 11, 1992
Canada 1,316,344 April 20, 1993
Phillipines 27539 August 18, 1993
European 0395692 December 12, 1993
<PAGE>
C.E.C. believes that its patents have value but no
representation is made that C.E.C. will be able to sustain the
validity of its present patents.
EMPLOYEES
The Company and its subsidiaries currently employ 16 full
time employees and 6 part time employees.
PROPERTIES
Principal and Executive Offices. C.E.C. rents 1,869 square
feet of office space and 1,310 square feet of warehouse space for
CEI at 350 West 300 South, Salt Lake City, Utah 84101; 2,622
square feet of office space for its executive offices at 23
Cactus Garden Drive, F-60, Green Valley, Nevada 89014; and 2,000
square feet for Sterling Travel at 2200 N.W., Suite 220, Boca
Raton, Florida 33431. Lease expenses for the years ended March
31, 1995, March 31, 1994 and March 31, 1993 were $42,030, $8,615
and $10,575, respectively.
Mission Valley Mini-Storage Facility. A general discussion
of the mini-storage project is included under Item 1(c),
"Narrative Description of Business", "Operations". The Company
acquired 7.28 acres of property located in Las Vegas, Nevada as
part of a larger parcel of property, on February 9, 1994,
utilizing preferred stock of the Company. A market feasibility
study was developed by an outside source to determine the
effective use of the acreage. Management followed the
recommendation of the market feasibility study and is currently
under construction on 1123 storage units, 67 covered RV and boat
storage spaces, and 74 uncovered RV and boat storage spaces. The
Company applied for the appropriate zoning, and, upon receiving
the zoning, then obtained a construction loan from Bank of
America for $3,000,000 to construct the facility. Initial permits
have been obtained and work on the project commenced in July of
1995.
Other Las Vegas Properties. A general discussion of the
other parcels of property acquired on February 9, 1994, are
included under Item 1(c), "Narrative Description of Business",
"Operations". Upon completion of the development plans for the
approximate 20.30 acres located on Russell Road, Las Vegas,
Nevada, contiguous with the Company's mini-storage facility, the
Company will commence development and construction of the planned
commercial and multi-family facilities.
320 Unit - Victory Village Apartments. A general discussion
of the 320 unit Victory Village project is included under Item
1(c), "Narrative Description of Business", "Operations". During
June 1995, the Company acquired a 24.5% interest in the Victory
Village III, Ltd. partnership utilizing Rule 144 restricted
common stock of the Company valued at $700,000. A $16,442,400
loan was recorded against the approximate 17.72 acres providing
the construction financing for the project. Moonridge Development
Corp. will act as the General Contractor for the project. (See
Note 13 of the consolidated financial statement)
RISK FACTORS
The purchase of the securities offered hereby is subject to risk.
Investors should evaluate these risk factors carefully.
<PAGE>
Need for Additional Financing.
The Company currently operates through revenues generated by
sales of the Company's products. There is no assurance that such
sales will continue as they have in the past, or will increase in
the future. In order to succeed the Company may require
additional capital for working capital and for marketing. There
can be no assurance that such financing will be available, when
required, on acceptable terms.
Competition.
Although the Company believes its products are superior to those
of its present competitors; the market for the Company's product
lines is very large. As such, there are major companies that have
already captured major portions of the various product markets
which the Company's subsidiary's are involved. These companies
have resources much greater than those of the Company. There is
no assurance that the Company's products will continue to be
competitive in the marketplace.
Markets Uncertain.
Despite the business experience of the officers, directors, and
principal shareholders of the Company, and the Company's products
there can be no assurance that markets for the Company's products
will continue to be sizable enough to permit the Company to
operate profitably.
Reliance on Management.
All decisions with respect to the management of the Company will
be made exclusively by its officers and directors. To a large
extent, the success of the Company will depend upon the quality
of the management provided by its officers and directors.
Dependence upon Key Personnel.
The success of the Company will be largely dependent on the
personal efforts of key employees and directors, who are
responsible for the development of the business of the Company.
The Company relies heavily on the experience, expertise and
business contacts of its officers and directors. If any of the
officers or directors should, for whatever the reason, cease to
serve the Company, the Company may find it difficult to find
replacements within a short time frame, and thus, the Company's
ability to meet its goals could be adversely affected.
INFORMATION WITH RESPECT TO THE COMPANY
This prospectus is accompanied by the Company's Form 10K for the
year ended March 31, 1994, and its latest Quarterly Reports filed
subsequent thereto, for the quarter ending September 30, 1995.
These Annual, Quarterly and Current Reports, as well as all other
reports filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934, are hereby
incorporated by reference in this prospectus and may be obtained
upon the oral or written request of any person to the Company at
23 Cactus Garden Drive, F-60, Henderson, Nevada 89014 telephone
number (702) 436-2500.
<PAGE>
PART II
Item 3. Incorporation of Documents by Reference.
The following C.E.C. document are incorporated by reference
in this Registration Statement: (a) C.E.C.'s Annual Report on
Form 10-K for the year ended March 31, 1995; (b) C.E.C.'s
Quarterly Report on Form 10-Q for the quarter ended September 30,
1995; (c) C.E.C.'s Current Report on Form 8-K dated October 1995;
and, (d) Amended Articles of Incorporation Reflecting Name Change
and Authorized Shares.
All documents filed by C.E.C. pursuant to Sections 13(a),
13(c), 14, and 15(d) of the Securities Exchange Act of 1934
subsequent to the date of this Registration Statement and prior
to the date of the filing of a post-effective amendment which
indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold shall be deemed
to be incorporated by reference into this Registration Statement
and to be part thereof from the dates of the filing of such
documents.
Item 4. Description of Securities.
C.E.C.'s authorized stock consists of 50,000,000 shares of
common stock, par value $.05 per share. The holders of common
stock (i) have equal ratable rights to dividends from funds
legally available therefore, when as and if declared by the Board
of Directors of C.E.C.; (ii) are entitled to share ratably in
all of the assets of C.E.C. available for distribution to
shareholders upon liquidation, dissolution or winding up of the
affairs of C.E.C.; (iii) do not have pre-emptive, subscription
or conversion rights and there are no redemption or sinking fund
provisions applicable thereto; and (iv) are entitled to one non-
cumulative vote per share, on outstanding are fully paid for and
non-assessable and all shares of common stock which are the
subject of this offering, when issued will be fully paid for and
non-assessable.
Item 5. Interest of Named Experts and Counsel
No expert named in the Registration Statement as having
prepared or certified any part thereof, including counsel for the
registrant named in the prospectus as having given and opinion
upon the validity of the securities being registered, was
employed for such purpose on a contingent basis, or is to receive
in connection with the offering a substantial interest, direct or
indirect, in the registrant or any of its parents or
subsidiaries, or is connected with the registrant or any of its
parents or subsidiaries as a promoter, managing underwriter,
voting trustee, director, officer, or employee, other than Donald
J. Stoecklein, Esq., legal counsel for the Company, which legal
counsel is also a Director of the Company. Further, it is
anticipated that Mr. Stoecklein may be the recipient of shares of
stock issued as the result of this Prospectus.
Item 6. Indemnification of Officers and Directors.
Section 78.751 of the Nevada General Corporation Laws
provides as Follows:
78.751. Indemnification of officers, directors, employees
and agents; advancement of expenses.
1. A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, except an action by or
in the right of the corporation, by reason of the fact that he is
or was a director, officer, employee or agent of the corporation,
or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against
expenses, including attorneys' fees, judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted in
good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the corporation, and,
with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The
termination of any action , suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo contendere
or its equivalent, does not, of itself, create a presumption that
the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests
of the corporation, and that, with respect to any criminal action
or proceeding, he had reasonable cause to believe that his
conduct was unlawful.
<PAGE>
2. A corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the
fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the
corporation as a director , officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise against expenses, including amounts paid in settlement
and attorneys' fees actually and reasonably incurred by him in
connection with the defense or settlement of the action or suit
if he acted in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the
corporation. Indemnification may not be made for any claim,
issue or a matter as to which such a person has been adjudged by
a court of competent jurisdiction, after exhaustion of all
appeals therefrom, to be liable to the corporation or for amounts
paid in settlement to the corporation, unless and only to the
extent that the court in which the action or suit was brought or
other court of competent jurisdiction determines upon application
that in view of all the circumstances of the case, the person is
fairly and reasonably entitled to indemnity for such expenses as
the court deems proper.
3. To the extent that a director, officer, employee or agent
of a corporation has been successful on the merits or otherwise
in defense of any action, suit or proceeding referred to in
subsections 1 and 2, or in defense of any claim, issue or matter
therein, he must be indemnified by the corporation against
expenses, including attorneys' fees, actually and reasonably
incurred by him in connection with the defense.
4. Any indemnification under subsections 1 and 2, unless
ordered by a court or advanced pursuant to subsection 5, must be
made by the corporation only as authorized in the specific case
upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances. The
determination must be made:
(a) By the stockholders;
(b) By the board of directors by majority vote of a
quorum consisting of directors who were not parties to the
act, suit or proceeding;
(c) If a majority vote of a quorum consisting of
directors who were not parties to the act, suit or
proceeding so orders, by independent legal counsel in a written
opinion; or
(d) If a quorum consisting of directors who were not
parties to the act, suit or proceeding cannot be obtained, by
independent legal counsel in a written opinion.
5. The certificate or articles of incorporation, the bylaws
or an agreement made by the corporation may provide that the
expenses of officers and directors incurred in defending a civil
or criminal action, suit or proceeding must be paid by the
corporation as they are incurred and in advance of the final
disposition of the action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the director or officer to repay
the amount if it is ultimately determined by a court of competent
jurisdiction that he is not entitled to be indemnified by the
corporation. The provisions of this subsection do not affect any
rights to advancement of expenses to which corporate personnel
other than directors or officers may be entitled under any
contract or otherwise by law.
6. The indemnification and advancement of expenses
authorized in or ordered by a court pursuant to this section:
<PAGE>
(a) Does not exclude any other rights to which a person
seeking indemnification or advancement of expenses may be
entitled under the certificate or articles of
incorporation or any bylaws, agreement, vote of
stockholders or disinterested directors or otherwise,
for either an action in his official capacity or an
action in another capacity while holding his office,
except that indemnification, unless ordered by a court
pursuant to subsection 2 or for the advancement of
expenses made pursuant to subsection 5, may not be made
to or on behalf of any director or officer if a
final adjudication establishes that his acts or omissions
involved intentional misconduct, fraud or a knowing
violation of the law and was material to the cause of
action.
(b) Continues for a person who ceased to be a director,
officer, employee or agent and inures to the benefit of the
heirs, executors and administrators of such a person.
Article XI of CEC's Bylaws provides as follows:
Section 1. The Corporation shall indemnify any person who
was 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 Corporation), by reason of the fact that he is
or was a director, officer, employee or agent of the Corporation,
or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise (including
attorney's fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interest of the Corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his
conduct was unlawful. The termination of any action, 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 he reasonably believed to be in or not
opposed to the best interests of the Corporation, and with
respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
The 1995 Stock Award Plan contains provisions indemnifying
those same persons in their capacities as administrators of the
Plan. C.E.C. does not have insurance to indemnify its offices
and directors in accordance with any of the above.
Item 7. Exemption From Registration Claimed.
Not Applicable
Item 8. Exhibits.
5 Opinion of Donald J. Stoecklein, Attorney-at-law, regarding
legality of shares being issued (1).
10 Consultant and Employee Stock Compensation Plan (1).
24 Consent of Donald J. Stoecklein, Attorney-at-Law, (contained
in its opinion filed as Exhibit 5 to this Registration
Statement (1).
__________________________________________
(1) Filed herewith.
Item 9. Undertakings.
The undersigned registrant hereby undertakes:
<PAGE>
(1) To file, during any period in which offers or sales are
being made, a 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 election of a managing underwriter.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
offered at that time shall be deemed 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.
The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933,
each filing of the Company's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement
referring to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company 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 Company 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
Company will, unless in the opinion of its counsel that matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
SIGNATURES
Pursuant to 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 for filing on Form S-8 and
has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Las Vegas, State of Nevada, on this 10th day of November
1995.
<PAGE>
SIGNATURES
Pursuant to 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 for filing on Form
S-8 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in
the City of Las Vegas, State of Nevada, on this 21st day of
November 1995.
C.E.C. INDUSTRIES CORP.
By /s/ Richard Cope
Richard Cope, President
By /s/ Donald J. Stoecklein
Donald J. Stoecklein, Secretary
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following
persons in the capacities indicated on November 10, 1995.
Signature Title Date
/s/ Ralph Mann Director November 10, 1995
Ralph Mann
/s/ Dwight W. Jory Director November 10, 1995
Dwight W. Jory
/s/ Charles McChaffie Director November 10, 1995
Charles McChaffie
/s/Donald J. Stoecklein,ESQ. Director,Secretary November 10, 1995
Donald J. Stoecklein
/s/Ronald G. Stoecklein Director November 10, 1995
Ronald G. Stoecklein
<PAGE>
EXHIBIT 5 AND 24
Opinion and Consent of
Donald J. Stoecklein
<PAGE>
ATTORNEY AT LAW
Telephone(702)436-2530
Facsimile(702)436-2528
DONALD J. STOECKLEIN
Praactce Limited to Federal Securities
23 Cactus Garden Drive, F-60, Henderson, Nevada 89014
November 9, 1995
Mr. Richard Cope
CEC Industries, Corp.
23 Cactus Garden Drive, F-60
Henderson, Nevada 89014
RE:REGISTRTION STATEMENT ON FORM S-8
Dear Mr. Cope:
You have requested our opinion as to the legality of the registration by you,
CEC Industries, Corp., (the "Corporation") of up to 1,000,000 shares of Common
Stock (the "shares") pursuant to a registration Statement on Form S-8 (the
"Registration Statement") to be filed on November 10, 1995:
As your counsel we have reviewed and examined:
1. The Articles of Incorporation of the Corporation, as amended (the
"Articles");
2. The Bylaws of the Corporation, as certified by the Secretary of the
Corporation;
3. The Resolution of the corporation authorizing the registration;
4. The minute book of the Corporation;
5. The Corporation's 10-K for 1995, 1994 and 1993; 10Q for the period ending
September 30,1995.
6. The Form S-8 Registration Statement;
7. The Consultant and Employee Stock Compensation Plan; and
8. Such other matters as we have deemed relevant in order to form our
opinion.
In giving our opinion, we have assumed without investigation the authenticity
of any document or instrument submitted to us as an original, the conformity to
the original of any document or instrument submitted to us as a copy, and the
genuineness of all signatures on such originals or copies.
<PAGE>
Based upon the foregiong, and subject to the qualifications set forth below, we
are of the opinion that the Shares, if issued and sold as described in the
Registration Statement (provided that at least par value is paid for the
shares): (i) will have been duly authorized, legally issued, fully paid and
nonassessable, (ii) when issued will be a valid and binding obligation of the
corporation, and (iii) do not require a permit from and governmental agency.
Our opinion is subject to the qualification that no opinion is expressed herein
as to the application of the state securities or Blue Sky laws.
This opinion us furnished by us as counsel to you and is solely for your
benefit. Neither this opinion nor copies fereof may be relied upon by,
delivered to, or quoted in whole or in part to any governmental agency or
other person without prior written consent.
Notwithstanding the above, we consent to the use of our opinion in regards to
the Request to Transfer Agent for transfer of the above referred to shares.
Yours Very Truly,
/s/Donald J. Stoecklein
Donald J. Stoecklein
<PAGE>
EXHIBIT 10
CONSULTANT AND EMPLOYEE STOCK OPTION PLAN
<PAGE>
1995 CONSULTANT AND EMPLOYEE STOCK COMPENSATION PLAN
C.E.C. Industries, Corp.
I.
Purpose of the Plan.
The purpose of this Plan is to further the growth of C.E.C.
Industries, Corp. ("C.E.C.") by allowing the Company to
compensate officers, directors, consultants and certain other
persons providing bona fide services to the Company, through the
award of C.E.C.'s common stock.
II.
Definitions
Whenever used in this Plan, the following terms shall have the
meanings set forth in this Section:
1. "Award" means any grant of Common Stock made under this Plan.
2. "Board of Directors" means the Board of Directors of C.E.C.
Industries, Corp.
3. "Code" means the Internal Revenue Code of 1986, as amended.
4. "Common Stock" means the common stock, no par value per share,
of C.E.C. Industries, Corp.
5. "Date of Grant" means the day the Board of Directors
authorizes the grant of an Award or such later date as may be
specified by the Board of Directors as the date a particular
Award will become effective.
6. "Employee" means any person or entity that renders bona fide
services to the Company (including, without limitation, the
following: a person employed by the Company in a key capacity; an
officer or director of C.E.C. Industries, Corp. or one or more
Subsidiaries; a person or company engaged by the Company as a
consultant; or a lawyer, law firm, accountant or accounting firm.
7. "Subsidiary" means any corporation that is a subsidiary with
regard to C.E.C. Industries, Corp. as that term is defined in
Section 424(f) of the Code.
III.
Effective Date of the Plan
The effective date of this Plan is November 10, 1995.
<PAGE>
IV.
Administration of the Plan
The Board of Directors will be responsible for the administration
of this Plan, and will grant Awards under this Plan. Subject to
the express provisions of this Plan, the Board of Directors
shall have full authority and sole and absolute discretion to
interpret this Plan, to prescribe, amend and rescind rules and
regulations relating to it, and to make all other determinations
which it believes to be necessary or advisable in administering
this Plan. The determinations of the Board of Directors on the
matters referred to in this Section shall be conclusive. The
Board of Directors shall have sole and absolute discretion to
amend this Plan. No member of the Board of Directors shall be
liable for any act or omission in connection with the
administration of this Plan unless it resulted from the member's
willful misconduct.
V.
Stock Subject to the Plan
The maximum number of shares of Common Stock as to which Awards
may be granted under this Plan is 650,000 shares. The Common
Stock which is issued on grant of awards may be authorized but
unissued shares or shares which have been issued and re-acquired
by C.E.C. The Board of Directors may increase the maximum number
of shares of Common Stock as to which Awards may be granted at
such time as it deems advisable.
VI.
Persons Eligible to Receive Awards
Awards may be granted only to Employees, or Consultants of the
Company, whether individual or corporate.
VII.
Grants of Awards
Except as otherwise provided herein, the Board of Directors shall
have complete discretion to determine when and to which
Employees or Consultants Awards are to be granted, and the number
of shares of Common Stock as to which awards granted to each
Employee or consultant will relate. No grant will be made if, in
the judgment of the Board of Directors, such a grant would
constitute a public distribution within the meaning of the
Securities Act of 1933, as amended (the "Act"), or the rules and
regulations promulgated thereunder.
<PAGE>
VIII.
Delivery of Stock Certificates
As promptly as practicable after authorizing the grant of an
Award, C.E.C. Industries, Corp. shall deliver to the person who
is the recipient of the Award, a certificate or certificates
registered in that person's name, representing the number of
shares of Common Stock that were granted. If applicable, each
certificate shall bear a legend to indicate that the Common Stock
represented by the certificate was issued in a transaction which
was not registered under the Act, and may only be sold or
transferred in a transaction that is registered under the Act or
is exempt from the registration requirements of the Act.
IX.
Employment
Nothing in this Plan or in the grant of an Award shall confer
upon any Employee or consultant the right to continue in the
employ of the Company nor shall it interfere with or restrict in
any way the rights of the Company to discharge any employee at
any time for any reason whatsoever, with or without cause.
X.
Laws and Regulations
The obligation of C.E.C. Industries, Corp. to sell and deliver
shares of Common Stock on the grant of an Award under this Plan
shall be subject to the condition that counsel for C.E.C.
Industries, Corp. be satisfied that the sale and delivery thereof
will not violate the Act or any other applicable laws, rules or
regulations.
XI.
Withholding of Taxes
If subject to withholding tax, the Company shall be authorized to
withhold from an Employer's salary or other cash compensation
such sums of money as are necessary to pay the Employee's
withholding tax. The Company may elect to withhold from the
shares to be issued hereunder a sufficient number of shares to
satisfy the Company's withholding obligations. If the Company
becomes required to pay withholding tax to any federal, state or
other taxing authority as a result of the granting of an Award
and the Employee fails to provide the Company with the funds
with which to pay that withholding tax, the Company may withhold
up to 50% of each payment of salary or bonus to the Employee
(which will be in addition to any other required or permitted
withholding), until the Company has been reimbursed for the
entire withholding tax it was required to pay.
<PAGE>
XII.
Reservation of Shares
C.E.C. Industries, Corp. shall at all times keep reserved for
issuance on grant of awards under this Plan a number of
authorized but unissued or reacquired shares of Common Stock
equal to the maximum number of shares C.E.C. Industries, Corp.,
may be required to be issued on the grant of Awards under this
Plan.
XIII
Termination of the Plan
The Board of Directors may suspend or terminate this Plan at any
time or from time to time, but no such action shall adversely
affect the rights of a person granted an Award under this Plan
prior to that date.
XIV.
Delivery of Plan
A Copy of this Plan shall be delivered to all participants,
together with a copy of the resolution or resolutions of the
Board of Directors authorizing the granting of the Award and
establishing the terms, if any, of participation.
No dealer, salesman, or any other person has been authorized by
the Company to give any information or to make any
representations other than those contained in this Prospectus in
connection with the offering made hereby, and if given or made,
such information or representations must not be relied upon. This
Prospectus does not constitute an offer to sell or the
solicitation of an offer to buy any securities other than those
specifically offered hereby or an offer to sell, or a
solicitation of an offer to buy, to any person in any
jurisdiction in which such offer or sale would be unlawful.
Neither the delivery of this Prospectus nor any sale made
hereunder shall under any circumstances create any implication
that there has been no change in the affairs of the Company since
any of the dates as of which information is furnished or since
the date of this Prospectus.
