SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
October 22, 1998
Date of Report
(Date of Earliest Event Reported)
U S Jet, Inc.
(Exact Name of Registrant as Specified in its Charter)
Nevada 33-8067-NY 84-1422609
(State or other (Commission File No.) (IRS Employer I.D. No.)
Jurisdiction
111 Airport Road
Butte, Montana 59701
(Address of Principal Executive Offices)
Registrant's Telephone Number
406-494-7512
American Coal Corporation
1969 West North Temple
Salt Lake City, Utah 84116
(Former Name or Former Address if changed Since Last Report)
Item 1. Changes in Control of Registrant.
None; not applicable.
Item 2. Acquisition or Disposition of Assets.
None; not applicable.
Item 3. Bankruptcy or Receivership.
None; not applicable.
Item 4. Changes in Registrant's Certifying Accountant.
None; not applicable.
Item 5. Other Events.
Pursuant to a Foreign Trade Zone Agreement (the "Agreement") dated
October 8, 1998, between the Registrant and the Port of Montana ("Port
Authority"), a municipal corporation of the City and County of Butte-Silver
Bow, Montana, the Registrant has been granted the right, as "zone operator",
to conduct foreign trade business at the Registrant's 236,000 squareft
temperature-controlled logistics and distribution warehouse facility
("Zone Facility"), located at Butte, Montana. Implementation of the Agreement
is vitally important to the Registrant's plans to operate international air
cargo and trade operations from its principal logistics facilities in Montana,
which include the Zone Facility.
The Port Authority is the grantee for Foreign-Trade Zone ("FTZ") No.
190, which covers a limited area within the Southern region of Silver Bow
County, Montana. The goal of the Port Authority is to use FTZ #190 to help
businesses within its service area, such as the Registrant, compete in the
global marketplace.
The Registrant's Zone Facility is located in the immediate area of the
Bert Mooney Municipal Airport, in Butte, Montana, where the Registrant
maintains international air cargo facilities that include a fixed base
operator, executive offices, a full complement of ground support equipment,
and hangars that will serve as the Company's base for maintenance work, parts
storage, and flight dispatch operations. U.S. Customs is also located at the
Bert Mooney Municipal Airport.
Merchandise held by the Registrant in an FTZ is considered to be in
international commerce. As a result, no formal customs entry is required, no
visa for quota merchandise is required, and no duty or excise taxes need to be
paid. Once in the FTZ, merchandise may be stored, exhibited, mixed,
manipulated, processed or destroyed, and is only subject to quota restrictions
or duty if the merchandise is transferred from the FTZ into US commerce.
Merchandise brought into the FTZ from outside the US for later export is never
subject to duty or quotas. Domestic merchandise entering the FTZ may be
exported at the time it enters the FTZ as opposed to when it leaves the US.
These FTZ characteristics enable the Registrant's customers to elect
what they want to pay duty on, the part that is imported or the finished
product into which the imported part is placed, choosing the lower of the two
tariff rates. If duty rates are going down, the duty can be paid at the time
the part leaves the FTZ. If rates are going up, the duty can be paid
immediately. The expense and paperwork involved in filing for duty drawback on
exports are eliminated. The Registrant's customers may bring large quantities
of goods into the FTZ and release their products into U.S. Customs territory
as needed.
Pursuant to the Agreement, the Registrant is required to maintain
inventory records tracking foreign merchandise in the Zone Facility, to file
an entry form each time merchandise enters the Zone Facility, and to prepare
and file an annual report.
Item 6. Resignation of Registrant's Directors
None; not applicable.
Item 7. Financial Statements and Exhibits.
The following exhibit is filed as part of this report:
Description of Exhibit* Number
Foreign Trade Zone Agreement 10
Exhibit A - Map of Registrant's Zone Facility
Item 8. Change in Fiscal Year.
None; not applicable.
Item 9. Sales of Equity Securities Pursuant to Regulation S.
None; not applicable.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this Report to be signed on its behalf by
the undersigned hereunto duly authorized.
U S JET, INC.
Date: 10/28/98 By/s/Kenneth R. DeBree
Kenneth R. DeBree
President and Director
FOREIGN TRADE ZONE AGREEMENT
This Foreign Trade Zone Agreement (this "Agreement") is entered into
this 8th day of October, 1998 by and between the Port of Montana, a municipal
corporation of Butte-Silver Bow, Montana (the Butte-Silver Bow designee
responsible for Foreign Trade Zone No. 190), hereinafter referred to as the
"Port"; and U S Jet, Inc., a Nevada corporation, with principal business
offices at Butte, Montana, hereinafter referred to as the "Zone Operator".
WITNESSETH:
WHEREAS, the Foreign-Trade Zones Act of June 18, 1934, as amended,
authorized and empowered the Foreign-Trade Zones board to grant to public and
private corporations the privilege of establishing, operating and maintaining
foreign-trade zones in or adjacent to ports of entry under the jurisdiction of
the United State of America; and
WHEREAS, Butte Silver Bow has been granted authority from the Foreign-
Trade Zones Board, pursuant to FTZ Board Order No. 622, to establish, operate
and maintain a General Purpose Foreign Trade Zone in Butte-Silver Bow,
Montana; and
WHEREAS, the Zone Operator, upon the terms and conditions herein set
forth, wishes to conduct foreign trade business at the site (the "Zone
Facility") depicted in the Exhibit "A" attached to and incorporated herein by
reference.
NOW, THEREFORE, the parties hereto, in consideration of the mutual
agreements herein contained and promises herein expressed, and for other good
and valuable consideration acknowledged by each of them to be satisfactory and
adequate, do agree as follows:
1. DEFINITIONS
The following words shall have the following meanings when used in this
Agreement.
1.1. "Act" shall mean the Foreign-Trade Zones act of June 18
1934 (48 Stat. 998-1003; 19 USC 81 81a-81u), as amended.
1.2. "Annual Report" shall mean the annual report required of
the Port under the Act and/or the Regulations.
1.3. "The Board" shall mean the Foreign-Trade Zones Board which
was established by the Act.
1.4. "The Regulations" shall mean collectively the regulation
currently published in the Code of Federal Regulations at
Title 15, Part 400, and Title 19, Part 146, as such
regulations may be amended in the future.
1.5. "USCS" shall mean the United States Customs Service.
1.6. "Operating Procedures" shall mean such operating procedures
as may be required of the Zone User by the USCS.
2. AUTHORITY GRANTED
Subject to the approval of the Board, the Port authorizes the Zone
Operator to utilize the Zone Facility as a foreign-trade zone in
accordance with the terms, conditions, agreements and restrictions
hereinafter set forth.
3. RESPONSIBILITY OF THE ZONE OPERATOR
The Zone Operator will be responsible for handling its zone operations
at the Zone Facility. The Zone Operator has the right to engage the
services of a subcontractor to perform its zone operations, subject to
the approval of the Port. If the Zone Operator engages the services of
a subcontractor, the Zone Operator agrees to remain primarily liable for
the performance of all obligations herein. The Zone Operator shall
incorporate the terms and conditions of this Agreement into any
agreement between the Zone Operator and a subcontractor. These
operations include, but are not limited to the following:
3.1. Establishing and implementing Operating Procedures to be
followed at the Zone Facility which will satisfy the regulatory
requirements of the USCS;
3.2. Entering into an agreement, where necessary, with the United
States Census Bureau regarding the furnishing of statistical
copies of the Customs Form 214 (Customs Form 214A) and other
statistical information;
3.3. Keeping track of all merchandise admitted into and delivered
from the Zone Facility and entered into consumption from the Zone
Facility;
3.4. Preparing the Annual Report for the activities conducted at
the Zone Facility to be filed by the Port with the Board;
3.5. Preparing any and all documentation required by the USCS and
the Board to be prepared by a foreign trade zone operator;
3.6. Ensuring that the proper Customs Form 301 Foreign-Trade Zone
Operator's Bond is maintained and kept current with USCS, covering
the activities at the Zone Facility;
3.7. Providing the physical security required by the USCS in order
to ensure the safekeeping of merchandise at the Zone Facility;
3.8. Establishing an electronic interface with the USCS through
its automated commercial system, when the specifications and
requirements of that interface have been developed and implemented
by USCS.
The Zone Operator acknowledges that it has read, reviewed and
understands the Act, the Regulations, directives of USCS, and all other
applicable laws and regulations. The Zone Operator separately and
independently covenants with the Port that it or its subcontractor shall
at all times conform to the requirements of the Act, the Regulations,
directives of USCS, and all other applicable laws and regulations.
4. RESPONSIBILITIES OF THE PORT
4.1. Foreign-Trade Zone Forms. The Zone Operator is authorized to
execute in its own name Customs Forms 214 and 216 in its operation
of the Zone Facility. Without limiting the Port's rights to
inspect and audit as provided herein, the parties specifically
recognize that the Port is not obligated to, and does not intend
to, monitor the day-to-day activity of the Zone Facility.
4.2. Annual Report. The Port is responsible for furnishing the
Annual Report to the Board from the information given to it by the
Zone Operator pursuant to paragraph 3.4 of this Agreement. The
Zone Operator shall be responsible for preparing a narrative as
required for the Port's Annual Report to the Board.
5. RECORDKEEPING, INSPECTION AND AUDIT
5.1. The Zone Operator agrees to submit to the Port, at the end of
each Federal fiscal year, reports containing data required by the
Board with respect to its operations at the Zone Facility. The
Zone Operator shall sign all reports to certify their accuracy.
All financial and operations information concerning the Zone
Facility shall be kept confidential except that which is required
to be made public by the Board or any other public agency.
5.2. The Zone Operator agrees to retain all financial and
accounting records concerning its operations at the Zone Facility
for five (5) years after the act or occurrence is recorded, or
after the merchandise covered by such records has been forwarded
from the Zone Facility and the Zone Operator's Customs Form 214
file folder has been closed, whichever is longer. The Port shall
have the right, upon notice and during normal business hours at
any time and from time to time, to conduct inspections and audits
of the Zone Operator's records in connection with its operations
of the Zone Facility. The Zone Operator and its employees and
agents shall cooperate fully in connection therewith and at no
extra cost to the Port. The Zone Operator's cooperation is to
include but not be limited to making available to the Port, for
on-site physical inspection or copying, the books, records and
accounts which the Zone Operator is required by the USCS to keep
for the Zone Facility. The Zone Operator shall answer inquiries
to be made in such manner or form as the Port deems appropriate
(including personal interviews) covering any aspect of the Zone
Operator's operations under this Agreement at the Zone Facility.
Nothing herein is intended to preclude the Zone Operator from
asserting against the Port a claim of privilege or confidentially
regarding its records that the Zone Operator could assert against
the USCS, the Board or a successor agency, but nothing herein is
intended to preclude the Port from contesting such claims.
5.3. Notwithstanding any of the foregoing, any information regarding
the Zone Operator shall be kept confidential by the Port and shall not
be disclosed to any other person, except for such information as shall
be determined by the Port to be public information under federal, state
or local laws. In addition, any and all Opertating Procedures manuals,
computer programs, computer reports and systems designs developed or
used by the Zone Operator shall be the sole property of the Zone
Operator and will not be disclosed by the Port to any other entity.
5.4. The Zone Operator shall promptly notify the Port of any other
reports requested by any government agency, and shall upon
request, provide copies of all such reports and investigative
documentation to the Port. In the event that any audit,
inspection or examination by the USCS, the Board or the Port
discloses that books, records or operational procedures of the
Zone Operator are not in conformity with the requirements of this
Agreement, the Zone Operator shall take all actions necessary to
correct such deficiencies.
6. ADMINISTRATIVE EXPENSES
6.1. Board Expenses. The Zone Operator shall pay the full cost of
any fees imposed by the Board which are attributable to the Zone
Operator's operation of the Zone Facility.
6.2. USCS Expenses. The Zone Operator shall pay the full cost of
any activation fee and annual fee imposed by the USCS attributable
to the Zone Operator's operation of the Zone Facility.
6.3. USCS Board Expenses. The Zone Operator shall pay the full
cost of any USCS Bond required by the USCS, including the Customs
Form 301 Foreign-Trade Zone Operator's bond for operation of the
Zone Facility.
6.4. Back to Back Bond. Upon written request from the Port, the
Zone Operator shall furnish and pay the premium for a bond in a
sum equal to the amount of the Customs Form 301 Foreign-Trade Zone
Operator's bond required by Customs pursuant to the Regulations,
conditioned upon the full, faithful and prompt performance of and
compliance with, on the part of the Zone Operator, all the
covenants, terms and conditions of this Agreement on its part to
be fulfilled, kept, performed and observed. The bond so furnished
shall be in a form acceptable to the Port and shall be effective
throughout the term of this Agreement and shall be made either by
a surety company or companies qualified to carry on a surety
business in the State of Montana and satisfactory to the Port.
6.5. Reimbursement by Port. Port shall not be obligated to
reimburse the Zone Operator for any expenses incurred by the Zone
Operator in connection with its operations at the Zone Facility,
including, without limitation, expenses covering or relating to
any of the following: assignment to the Zone Facility of USCS
employees; the obtaining of such surety bond as may be required of
the Zone Operator by the USCS; keeping of books, records and
accounts in the manner required by the Regulations; any costs
incurred by the Zone Operator pursuant to the Regulations and any
other expenses involving in any way the administration or
operation of the Zone Facility or the Zone Operator's compliance
with the terms of this Agreement. All such expenses shall be the
sole responsibility of the Zone Operator.
6.6. Reimbursement by Zone Operator. The Zone Operator shall pay
to the Port the amount of Two Thousand Dollars ($2,000.00) in
return for the Port's sponsorship of the zone application and
activation of the zone. The parties agree that this amount is
fair and reasonable compensation for the services to be rendered
by the Port in assisting the Zone Operator to obtain zone
activation. This amount is to be paid by the Zone Operator to the
Port within 10 days of the Port receiving activation approval for
the zone and is non-refundable.
6.7. Annual Fees. Upon activation of the Zone Facility, the Zone
Operator shall pay to the Port an annual fee in the amount of One
Thousand Five Hundred Dollars ($1,500.00) in return for the
services to be rendered by the Port to the Zone Operator with
regard to the Zone Operator's operation of the Zone Facility.
Subsequent annual fees shall be paid on the anniversary date of
the activation of the Zone Facility. The parties agree that this
is fair and reasonable compensation for the services to be
rendered by the Port to the Zone Operator with regard to the Zone
Operator's operation of the Zone Facility. Upon sixty (60) days'
written notice from the Port to the Zone Operator, the annual fee
may be modified so as to cover any additional expenses the Port
may incur which are related to the Zone Facility.
6.8. Fines. Without limiting the generality of any other provision
in this Agreement, the Zone Operator shall reimburse the Port for
any fine ultimately imposed on the Port by USCS as the result of
any act or omission of the Zone Operator or any of its
subcontractors under this Agreement. In the event any such fine
is imposed or if the Port is informed that any such fine is
contemplated, the Port shall promptly notify the Zone Operator in
writing and shall provide the Zone Operator the opportunity to
defend against such fine.
7. RECOGNITION OF SUCCESSOR
The Port agrees to recognize any successor to the Zone Operator under
this agreement as long as it is a subsidiary, affiliate or parent of the
Zone Operator. Notice of a change of interest in the Zone Facility to a
subsidiary, affiliate or parent of the Zone Operator must be given in
writing by the Zone Operator to the Port at least sixty (60) days prior
to such change.
8. RELATIONSHIP BETWEEN THE PORT AND ZONE OPERATOR
The Port and the Zone Operator are not and shall not be considered as
joint venturers, partners or agents of each other, and neither shall
have the power to bind or obligate the other except as set forth in this
Agreement. The Zone Operator and the Port agree not to represent to any
one that they are agents of one another or have any authority to act on
behalf of one another except as set forth in this Agreement.
9. INDEMNITY AND INSURANCE
The Zone Operator shall indemnify and hold harmless the Port and its
officers, employees and representatives from all claims and demands of
third persons, including but not limited to claims and demands for
death, personal injuries, property damage and other loss, arising out of
or connected or related in any way to the activities of the Zone
Operator, its agents, officers, representatives, employees or
contractors at or in connection with the Zone Facility, or its
responsibilities undertaken in connection therewith. Without limiting
the generality of the foregoing, it is understood that the Zone Operator
recognizes that this indemnity includes within its coverage all claims
and demands by any governmental agency, department or other entity,
including without limitation any claim or demand by the USCS for lost
duty, penalties, fines and liquidated damages. The Zone Operator shall
defend the Port against any such claim or demand that does not involve
an act or omission solely of Port, its officers, agents or employees.
In the event any claim or demand is asserted against the Port in
connection with the operation by the Zone Operator of the Zone Facility,
the Port shall promptly notify the Zone Operator in writing and shall
provide the Zone Operator with an opportunity to defend against such
claim or demand.
The Zone Operator shall, during the term of this Agreement, carry and
keep in force comprehensive general liability insurance policies, issued
by an insurance carrier or carriers acceptable to the Port in the
reasonable exercise of its sole discretion, providing coverage for the
liability assumed in this Agreement by the Zone Operator in amounts not
less than a level limit of $2,000,000/$2,000,000 for bodily injury and
death and $2,000,000 for property damage. The Zone Operator will, upon
activation, furnish the Port with certificates evidencing such
insurance, which certificates shall provide that there shall be no
reduction, cancellation or failure to renew such insurance without
thirty (30) days' written notice to the Port.
10. TERM AND RENEWAL
This Agreement is to become effective upon its execution by the Zone
Operator and the Port. Unless sooner terminated as herein provided, this
Agreement shall remain in effect for an initial term of five (5) years
from the effective date. Thereafter, this Agreement shall be
automatically renewed for four (4) renewal terms of five (5) years each,
unless either party has given written notice to the other party at least
six (6) months prior to a renewal date that such party desires not to
renew, in which case this Agreement shall expire as of said renewal date
if such notice has been given by the Port or the Zone Operator.
11. RIGHTS AND OBLIGATIONS OF PARTIES UPON TERMINATION
11.1. Termination by Zone Operator. The Zone Operator shall have
the right to terminate this Agreement and all rights and
obligations hereunder upon six (6) months prior written notice to
the Port.
11.2.Withdrawal of Grant - If the grant of authority for the Butte
- Silver Bow Foreign-Trade Zone, FTZ # 190 shall be revoked or
canceled and as a result thereof the Port is without permanent
authority to maintain the Zone Facility, the Port agrees to notify
the Zone Operator of its loss or proposed loss of such authority
in a timely fashion after it becomes known to the Port, in order
that the Zone Operator may have an opportunity to transfer the
grant of authority for the Zone Facility to another grantee
organization. Upon such transfer, or if there is no transfer, upon
the revocation or cancellation of the Butte - Silver Bow Foreign-
Trade Zone, FTZ # 190, this Agreement shall terminate and the Zone
Operator shall have no claim against the Port by reason of such
revocation or cancellation, and the Zone Operator shall have no
further interest in the subject matter of this Agreement. Should
the Port be prevented from continuing the maintenance of the Zone
Facility by statute, legal regulation or order of any court, the
Port may terminate this Agreement by written notice to the Zone
Operator. The Zone Operator shall have standing to institute
appropriate legal or administrative proceedings to contest the
validity or applicability of said statute, legal regulation or
court order, or to file an appeal from said court order, and
should said legal or administrative proceedings or appeal result
in a decision by a court or administrative body of competent
jurisdiction that the Port is not prevented from continuing the
operation of a foreign-trade zone at the Zone Facility by virtue
of said statute, legal regulation or court order, then this
Agreement shall be reinstated in full force and effect and Port
and Zone Operator shall be restored to their former positions
hereunder as if said termination had never taken place. It is
understood that the Port may sponsor other foreign-trade zone or
sub-zone operations in the State of Montana now or in the future.
11.3. Termination by the Port. The Port shall have the right, if
the Zone Operator is in breach of its obligations under this
Agreement, to terminate this Agreement and all rights and
obligations hereunder, provided that the Port has given written
notice to the Zone Operator regarding the breach of this
Agreement, and Zone Operator fails to pay any sums due within
forty-five (45) days of receipt of such notice or where correction
of such deficiency requires a longer period and the Zone Operator
has failed to commence to correct such deficiency within forty-
five (45) days of receipt of such notice and to correct such
deficiency within a reasonable period thereafter. Additionally,
the Port shall have the right to terminate this Agreement
immediately for cause due to cancellation of the Zone Operator's
bond, the expiration of its liability insurance policy or the
suspension of the grant by the Board.
12. NOTICES
All notices to the Port shall be sent by certified mail, return receipt
requested, addressed to the Port at the address stated herein or at such
other address as the Port designates in writing. All notices to the Zone
Operator shall be sent by certified mail, return receipt requested,
addressed to the Zone Operator at the address stated herein or at such
other address as the Zone Operator designates in writing. The date of
delivery as evidenced by the postal return receipt shall be deemed the
date of service of the notice.
13. MISCELLANEOUS
13.1.Construction. This Agreement shall be governed by and construed
in accordance with the Regulations adopted by the Board hereunder and
all amendments thereto, and the applicable laws of the State of
Montana.
13.2.Counterparts. This Agreement may be executed in any number
of counterparts, each of which when so executed and delivered
shall be deemed an original, but such counterparts together shall
constitute but one and the same Agreement.
13.3.Further Instruments and Actions . Each party shall deliver
such further instruments and take such further actions as may be
reasonably requested by the other in order to carry out the
provisions of this Agreement.
13.4.Headings. Headings and captions in this Agreement are solely
for convenience of reference and shall not affect its
interpretation.
13.5.Integration. This instrument contains the entire agreement
of the parties, and no representations, inducements, promises or
agreements, oral or otherwise, not embodied herein shall be of any
force or effect.
13.6.Severability. If any provision of this Agreement is declared
void or ineffective, that declaration will not affect the validity
of any other provision of this Agreement.
13.7.Waiver. No failure of either party hereto to exercise any
right or power given it hereunder, or to insist upon strict
compliance by the other party of any obligation hereunder, and no
custom or practice at variance with the terms hereof, shall
constitute a waiver of the party's right to demand exact
compliance with the terms hereof.
13.8.Gender. All terms and words used in this Agreement, regardless
of the number and gender in which they are used, shall be construed to
include any other number, singular or plural, and other gender,
masculine, feminine or neuter, as the context of this Agreement or any
paragraph or clause herein may require.
13.9.Amendment. This Agreement cannot be changed orally but only
by an agreement in writing by all parties hereto.
13.10.Exhibits. All exhibits or schedules referred to herein, or
which from time to time may be referred to in any duly executed
amendment hereto, are by such reference incorporated herein
and shall be deemed a part of this Agreement as if fully set forth
herein. Any exhibit or schedule incorporated herein may be
adjusted after the effective date of this Agreement, but only by a
formal amendment of this Agreement, by which a revised exhibit or
schedule shall be prepared by the Port and executed by the parties
hereto. Unless adjusted in strict accordance with this Agreement,
each exhibit or schedule, from its effective date, shall be deemed
a part of this Agreement at all times so long as it bears the
signatures or initials of both parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized officers as of the date stated at the
outset of this Agreement.
"Port"
THE PORT OF MONTANA
Post Office Box 3641
Butte, Montana 59701
By /s/ William J. Fogarty
General Manager
"Zone Operator"
U S JET, INC.
111 Airport Road
Butte, Montana 59701
By /s/ Kenneth R. DeBree
President
