<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
VERSAILLES CAPITAL CORPORATION
------------------------------
(Exact Name of Small Business Issuer in its Charter)
Colorado 84-1044910
- ------------------- --------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
370 17th Street, Suite 2350, Denver, Colorado 80203
-------------------------------------------------------------
(Address of Principal Offices) (Zip Code)
Registrant's telephone number, including area code: (303) 595-3300
Securities to be registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
NONE NONE
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, no par value
(Title of Class)
<PAGE>
<PAGE>
FORWARD-LOOKING STATEMENTS
Certain statements contained in this Registration Statement are
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 and are thus prospective. Such statements are
subject to risks, uncertainties and other factors which could cause actual
results to differ materially from future results expressed or implied by such
forward-looking statements. Such risks and uncertainties include, but are not
limited to, competitive pressures, changing economic conditions and other
factors, some of which will be outside of the control of the Company.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
HISTORY AND BACKGROUND
----------------------
Versailles Capital Corporation ("Versailles" or the "Company"), was
incorporated in the State of Colorado in December, 1986 under the name "Man
O'War, Inc." Pursuant to a Registration Statement filed and declared
effective by the Securities and Exchange Commission in 1987, the Company
completed an initial blank check public offering of 30,000,000 Units, each
Unit consisting of two (2) shares of $.0001 par value Common Stock and one (1)
Class A Warrant at a price of $.02 per Unit.
Effective October 4, 1988, the Company completed the acquisition of
one hundred percent (100%) of the outstanding common stock of Reduction
Technologies, Inc., a Texas corporation ("RTI"), in exchange for 369,000,000
shares of its $.0001 par value common stock. In 1991, RTI sold all of its
assets to a third party for cash and utilized the cash to retire all of its
liabilities. In 1993 RTI was dissolved and ceased to exist. Since 1991, the
Company has not engaged in any business operations or activities. In 1989,
the Company ceased to be a reporting company under Section 15(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") due to its
inability to audit the financial statements of RTI. While the Company's
Common Stock traded for a brief period of time on the over-the-counter market
and were quoted in the "Pink Sheets" published by the National Quotations
Bureau, Inc., no public trading market for the Company's Common Stock has
existed since 1989.
On November 5, 1996, pursuant to action of its Board of Directors
and the approval of its shareholders, the Company (i) changed its name to
"Versailles Capital Corporation" and (ii) effected a one-for-five hundred (1-
for-500) reverse split of its Common Stock, changing its par value to $.05 per
share.
BUSINESS OF REGISTRANT
----------------------
PLAN OF OPERATION
Management believes the Company can offer owners of potential merger
or acquisition candidates the opportunity to acquire a controlling ownership
interest in a public company at substantially less cost than is required to
conduct an initial public offering. The target company will, however, incur
significant post-merger or acquisition registration costs in the event target
company shareholders wish to offer a portion of their shares for subsequent
sale. Further, while target company shareholders will receive "restricted
securities" in any merger or acquisition transaction, those restricted
securities will represent, if a trading market develops for the Company's
common stock, ownership in a "publicly-traded" as opposed to a "privately-
held" company. Management also believes target company shareholders may
benefit in obtaining a greater ownership percentage in the Company remaining
after a merger or acquisition than may be the case in the event a target
company offered its shares directly for sale to the public. Nevertheless, the
officers and directors of the Company have not conducted market research and
are not aware of statistical data which would support the perceived benefits
of a merger or acquisition transaction for target company shareholders.
The Company expects to concentrate primarily on the identification
and evaluation of prospective merger or acquisition "target" entities
including private companies, partnerships or sole proprietorships. The
Company does not intend to act as a general or limited partner in connection
with partnerships it may merge with or acquire. Management has not identified
any particular area of interest within which the Company will concentrate its
efforts.
Management contemplates that the Company will seek to merge with or
acquire a target company with either assets or earnings, or both, and that
preliminary evaluations undertaken by the Company will assist in identifying
possible target companies. The Company has not established a specific level
of earnings or assets below which the Company would not consider a merger or
acquisition with a target company. Moreover, management may identify a target
company which is generating losses which it will seek to acquire or merge with
the Company. The merger with or acquisition of a target company which is
generating losses or which has negative shareholders' equity may have a
material adverse affect on the price of the Company's Common Stock.
PLAN OF ACQUISITION
The Company intends to follow a systematic approach to identify its
most suitable acquisition candidates.
First, management intends to concentrate on identifying any number
of preliminary prospects which may be brought to the attention of management
through present associations or by virtue of very limited advertising
campaigns the Company may conduct. As is customary in the industry, the
Company may pay a fee to a non-affiliate for locating a merger or acquisition
candidate. If any such fee is paid, it will be approved by the Company's
Board of Directors and will be in accordance with industry standards. After
preliminary candidates are identified, management will then apply certain of
its broad criteria to the prospects. Essentially, this will entail a
determination by management as to whether or not the prospects are in an
industry which appears promising and whether or not the prospects themselves
have potential within their own industries. During this initial screening
process, management will ask and receive answers to questions framed to
provide appropriate threshold information, depending upon the nature of the
prospects' businesses. Such evaluation is not expected to be an in-depth
analysis of the target company's operations although it will encompass a look
at most, if not all, of the same areas to be examined once one or more target
companies are selected for an in-depth review. For example, at this stage,
management may look at a prospect's unaudited balance sheet. Once a prospect
is selected for an in-depth review, management will review the prospect's
audited financial statements. Nevertheless, management anticipates this
evaluation will provide a broad overview of the business of the target company
and should allow a large percentage of preliminary prospects to be eliminated
from further consideration.
Assuming management is able to complete the preliminary evaluation
process and select a limited number of companies for further study, of which
there can be no assurance, the Company may enter into preliminary negotiations
with target company management in order to obtain detailed financial and
operational information. Following the Company's receipt of such information,
management will conduct an in-depth analysis of 5 major areas of concern with
respect to the target company as follows:
1. Managerial and Financial Stability.
----------------------------------
Management of the Company will review audited financial
statements of the target company, to the extent available, and will also
research the background of each director and member of management of the
target company in order to discern whether the stability of the Company is
such that further negotiations are warranted.
2. Industry Status.
---------------
Management will research the potential of the target company's
industry. The concern here is whether the industry is in a growth, stagnant
or declining stage.
3. Production of Product.
---------------------
If the target company is a manufacturer, management will review
whether it has the necessary resources or access to the necessary resources
and supplies to produce a quality product in a timely manner.
4. Acceptance and Potential of Product.
-----------------------------------
Management will review the acceptance of the target company's
product in the market place and assess the competition. Management will also
review whether or not the product is realistic: is there potential for the
product to be workable and to fulfill its intended purpose.
5. Development of Target Company.
-----------------------------
Management will review the target company's stage of
development (examples: start-up stage, established company, etc.).
The foregoing is an outline of the areas of concern which most often
arise and merit careful scrutiny by management. Because of the possible
varieties of target companies which may come to the attention of management,
additional factors will most likely be considered in any given analysis.
Also, the procedures used in such a review are expected to vary depending upon
the target company being analyzed. Management may select a target company for
further negotiations even though the target may not receive a favorable
evaluation as to some of the 5 areas of concern.
Management expects to enter into further negotiations with target
company management following successful conclusion of financial and evaluation
studies. Negotiations with target company management will be expected to
focus on the percentage of the Company which target company shareholders would
acquire in exchange for their shares in the target company. Depending upon,
among other things, the target company's assets and liabilities, the Company's
shareholders will in all likelihood hold a lesser percentage ownership
interest in the Company following any merger or acquisition. Assets of a
merger or acquisition candidate would be valued at historical cost for
transactional purposes. The percentage ownership may be subject to
significant reduction in the event the Company acquires a target company with
substantial assets. Any merger or acquisition effected by the Company can be
expected to have a significant dilutive effect on the percentage of shares
held by the Company's then-shareholders.
The final stage of any merger or acquisition to be effected by the
Company will require the Company to retain the services of its counsel and a
qualified accounting firm in order to properly effect the merger or
acquisition. The Company may be expected to incur significant legal fees and
accounting costs during the final stages of a merger or acquisition. Also, if
the merger or acquisition is successfully completed, management anticipates
that certain costs will be incurred for public relations, such as the
dissemination of information to the public, to the shareholders and to the
financial community. If the Company is unable to complete the merger or
acquisition for any reason, the Company's capital may be substantially
depleted if legal fees and accounting costs have been incurred. Management
intends to retain legal and accounting services only on an as-needed basis in
the latter stages of a proposed merger or acquisition.
Management anticipates that it will be necessary to raise additional
funds within the next 12 months to meet expenditures required for operations.
There are no current plans or commitments in this regard, and there can be no
assurance that the Company will be able to raise the funds necessary to
continue its limited operations.
COMPETITION
The Company will remain an insignificant participant among the firms
which engage in mergers with and acquisitions of privately-financed entities.
There are many established venture capital and financial concerns which have
significantly greater financial and personnel resources and technical
expertise than the Company. In view of the Company's combined limited
financial resources and limited management availability, the Company will
continue to be at a significant competitive disadvantage compared to the
Company's competitors. Also, the Company will be competing with numerous
other small, blank check, public companies.
EMPLOYEES
The Company is a development stage company and currently has no
employees. Management expects to use legal counsel, accountants and
consultants as necessary, and does not anticipate that it will engage any
full-time employees so long as it is seeking and evaluating business
opportunities. The need for employees and their availability will be
addressed in connection with the decision whether or not to acquire or
participate in specific business opportunities.
REGULATION AND TAXATION
The Company could be subject to regulation under the Investment
Company Act of 1940 in the event the Company obtains and continues to hold a
minority interest in a number of entities. Management's plan of operation is
based upon the Company obtaining a controlling interest in any merger or
acquisition target company and, accordingly, the Company may be required to
discontinue any prospective merger or acquisition of any company in which a
controlling interest will not be obtained.
The Company could also be required to register under the Investment
Company Act of 1940 in the event the Company comes within the definition of an
Investment Company contained in that Act due to its assets consisting
principally of shares held in a number of other companies. Management intends
to seek at most one or two mergers or acquisitions, which transactions
management believes will not result in the Company being deemed an "investment
company" since its interests will be in majority or wholly owned subsidiaries
which themselves will not be investment companies.
Any securities which the Company acquires in exchange for its Common
Stock will be "restricted securities" within the meaning of the Securities Act
of 1933 (the "1933 Act"). If the Company elected to resell such securities,
such sale could not proceed unless a registration statement had been declared
effective by the Securities and Exchange Commission or an exemption from
registration was available. Section 4(1) of the 1933 Act, which exempts sales
of securities not involving a distribution, would in all likelihood be
available to permit a private sale if various restrictions pertaining to such
a sale are complied with. Although management's plan of operation does not
contemplate resale of securities acquired, in the event such a sale were
necessary, the Company would be required to comply with the provisions of the
1933 Act.
As a condition to any merger or acquisition, it is possible that the
target company management may request registration of the Company's Common
Stock to be received by target company share holders. In such event, the
Company could incur registration costs, and management intends to require the
target company to bear most, if not all, of the cost of any such registration.
If the Company does contribute toward the cost of such registration, its
maximum contribution will be limited to the extent that the Company has assets
available for such contribution. Alternatively, the Company may issue
"restricted securities" to any prospective target company, which securities
may be subsequently registered for sale or sold in accordance with Rule 144 of
the Securities Act of 1933.
The Company intends to structure a merger or acquisition in such a
manner as to minimize federal and state tax consequences to the Company and
any target company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion and analysis should be read in conjunction
with the Financial Statements and Notes thereto appearing elsewhere in this
report.
LIQUIDITY AND CAPITAL RESOURCES: MARCH 31, 1997 COMPARED TO JUNE 30, 1996
(UNAUDITED)
The Company has no current or fixed assets and no working capital.
This is expected not to change until and unless the Company successfully
completes a business combination, of which there can be no assurance.
The Company's total liabilities increased by $9,570 during the three
months ended June 30, 1997, principally reflecting increases in accounts
payable and loans from shareholders resulting from the Company's activities
associated with the preparation of its audited financial statements and this
Registration Statement. This resulted in a similar increase in the Company's
stockholders' deficit. During the quarter, the Company issued an aggregate of
300,000 shares of common stock to various individuals in consideration of
their services to the Company. The shares of common stock were valued at par,
$.05 per share.
RESULTS OF OPERATION: YEARS ENDED MARCH 31, 1997 AND 1996, AND THREE MONTHS
ENDED JUNE 30, 1997
The Company had no operations during fiscal 1996, fiscal 1997 or the
first quarter of fiscal 1998 and, therefore, there were no operating revenues
during either period. Expenses increased from $1,460 to $16,061 and $7,424
from the year ended March 31, 1996 to the year ended March 31, 1997 and the
three months ended June 30, 1997, respectively. These expenses reflect legal
and accounting expenses incurred by the Company in connection with completing
its audited financial statements in the preparation of this Registration
Statement. As a result of the foregoing, the Company's net loss increased
from ($1,194) for the year ended March 31, 1996 to ($20,271) for the year
ended March 31, 1997 and ($9,570) for the three months ended June 30, 1997.
Absent a merger, acquisition or other business combination, there
will be no business operations or substantial results therefrom. The Company
will continue to incur expenses in its efforts to comply with its reporting
requirements under Section 13(a) of the Securities Exchange Act of 1934 as
well as in connection with its efforts to identify and complete a merger or
other business combination.
Other than the foregoing, management knows of no trends or other
demands, commitments, events or uncertainties that will result in, or that are
reasonably likely to result in, a material impact upon the income and expenses
of the Company.
ITEM 3. DESCRIPTION OF PROPERTY
The Company has no ownership interest in any real or personal
property. The Company currently maintains its corporate offices at 370 17th
Street, Suite 2350, Denver, Colorado 80203. This space is provided on a
rent-free basis by the Company's principal shareholder, Ms. Carylyn Bell. The
Company owns no equipment.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth, as of the date of this Registration
Statement, the number of shares of the Company's Common Stock owned by (i)
each person who owned of record, or was known to own beneficially, more than
five percent (5%) of the Company's outstanding shares of Common Stock,
(ii) each of the Company's current directors and executive officers and (iii)
all of the Company's current directors and executive officers as a group:
<TABLE>
<CAPTION>
Class Name and Address Amount and Nature Percent
of Stock of Beneficial Owner of Beneficial Ownership of Class <F1>
- -------- ------------------- ----------------------- -------------
<S> <C> <C> <C>
Common David C. Walters 39,334 3.1%
Stock, 255 Oakwood Drive
$.05 Lancaster, TX 25146
value
" William Maury Bell 41,533 3.2%
370 17th Street
Denver, CO 80203
Cindy R. Hintgen 33,333 2.6%
" 370 17th Street
Denver, CO 80203
" Carylyn K. Bell 504,496 39.3%
370 17th Street
Denver, CO 80203
" Clifford L. Neuman 66,667 5.2%
1507 Pine Street
Boulder, CO 80302
" All Officers and Directors 114,200 8.9%
as a Group (3 Persons)
- ---------------------------------------------------
<FN>
<F1> Shares not outstanding but beneficially owned by virtue of the
individuals' right to acquire them as of the date of this Registration
Statement, or within sixty (60) days of such date, are treated as
outstanding when determining the percent of the class owned by such
individual and when determining the percent of the class owned by the
group.
</FN>
</TABLE>
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
DIRECTORS AND EXECUTIVE OFFICERS.
The name, position with the Company, age of each director and
officer and the period during which each director and/or officer has served
are as follows:
<TABLE>
<CAPTION>
Director and/or Executive
Name and Position in the Company Age Officer Since
- -------------------------------- --- -------------
<S> <C> <C>
David C. Walters, 52 1996
President and Director
William Maury Bell 31 1996
Vice-President and Director
Cindy R. Hintgen 33 1996
Secretary/Treasurer and
Director
- --------------------------------------------------
</TABLE>
DAVID C. WALTERS, President. Mr. Walters has been Chairman of the
Board and President since inception. Currently, Mr. Walters is a partnership
with Pulling & Walters, L.L.P., Certified Public Accountants. From November
1985 until January 1986 he served as President and Director of Atlantic
Express, Inc., a publicly held company formed as a "blind pool" for the
purpose of acquiring and continuing a business opportunity. In January 1987,
Atlantic Express, Inc. complete a business combination with NTR, Inc., a New
York City based company engaged in the transportation business, at which time
Mr. Walters resigned as an officer but continues to serve as a director. From
August, 1982 to April, 1986, he was controller of Star CATV Investment Corp.,
a cable TV headquarters for 140 systems in Waxahachie, Texas. From 1980 to
1982, he served as Vice President and Treasurer of American/Chaparral, Inc.,
an oil and gas leasing and drilling company. He owned and operated Walters
Rentals, a company which engaged in real estate management and residential
loan origination and commercial loan brokering. He has served as Vice
President and Treasurer of Security Bankshares, Inc., a bank holding company
from 1975 to 1976; he was controller of First National Bank in Colorado
Springs, Colorado, from 1972 to 1974 and auditor for Fidelity Services
Corporation, a bank holding company, from 1967 to 1972. Mr. Walters graduated
from Lamar University with a BBA degree in Accounting in 1967. He became a
Certified Public Accountant in 1984.
WILLIAM MAURY BELL, Vice President. Mr. Bell is Vice President of
Huttner & Company, a Houston based management consulting firm. Prior to
working with Huttner & Company, Mr. Bell worked in the Corporate Finance
Consulting Department at Coopers & Lybrand, L.L.P.
CINDY R. HINTGEN, Secretary. Ms. Hintgen has worked as an Executive
Secretary for Industrial Services Technologies, Inc. for the last ten years.
From 1984 until 1987 she worked as a Word Processor for an architectural
design firm.
There are no family relationships among Directors or Executive
Officers and there exists no arrangements or understandings between any
Director or Executive Officer or any other person pursuant to which any
Director was elected as such. William Maury Bell, Vice-President and Director
of the Company, is the son of Carolyn Bell, a principal shareholder of the
Company. The present term of office of each Director will expire at the next
regular annual meeting of shareholders.
During the fiscal year ending March 31, 1997, there was one meeting
of Directors, attended by all members. There exists no standing committees of
the Board of Directors, including an audit committee, compensation committee
or nominating committee. None of the Company's Directors receive any
compensation for their services as Directors; however, outside Directors are
reimbursed their expenses associated with attendance at meetings or otherwise
incurred in connection with the discharge of their duties as a Director.
The Executive Officers of the Company are elected annually at the
first meeting of the Company's Board of Directors held after each annual
meeting of Shareholders. Each Executive Officer will hold office until his
successor is duly elected and qualified, until his resignation or until he
shall be removed in the manner provided by the Company's By-Laws.
None of the Company's officers and Directors will devote their full
time to the Company's affairs and such persons may be affiliated with other
business entities and enterprises, some of which may be formed for similar
purposes as the Company and thus be in direct competition with the Company.
Such activities may result in such persons being exposed to conflicts of
interest from time-to-time. The Company has adopted no other conflict of
interest policy with respect to such transactions. However, the officers and
Directors of the Company recognize their fiduciary obligation to treat the
Company and its shareholders fairly in any such future activities.
There are no material proceedings to which any director, officer or
affiliate of the Company, or any owner of record or beneficially of more than
five percent (5%) of any class of voting securities of the Company, or any
associate of any such director, officer, affiliate of the Company, or
securityholder is a party adverse to the Company or any of its subsidiaries or
has a material interest adverse to the Company or any of its subsidiaries.
During the past five years, no director or officer of the Company
has:
(1) Filed or has had filed against him a petition under the federal
bankruptcy laws or any state insolvency law, nor has a receiver, fiscal agent
or similar officer been appointed by a, court for the business or property of
such person, or any partnership in which he was a general partner, or any
corporation or business association of which he was an Executive Officer at or
within two years before such filings;
(2) Been convicted in a criminal proceeding or is a named subject
of a pending criminal proceeding (excluding traffic violations and other minor
offenses);
(3) Been the subject of any order, judgment, or decree, not
subsequently reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining such person from, or
otherwise limiting his involvement in any type of business, securities or
banking activities.
(4) Been found by a court of competent jurisdiction in a civil
action, the Securities and Exchange Commission or the Commodity Futures
Trading Commission to have violated any federal or state securities or
commodities law, which judgment has not been reversed, suspended, or vacated.
ITEM 6. EXECUTIVE COMPENSATION.
The Company did not pay compensation to any officers, Directors or
employees during Fiscal 1996 or 1997. No Executive Officer of the Company is
currently receiving a salary from the Company.
There are no written employment agreements between the Company and
any of its officers or Directors. The officers of the Company will dedicate
sufficient time to fulfill their fiduciary obligations to the Company's
affairs. The Company has no retirement, pension, profit sharing or insurance
or medical reimbursement plans, or stock incentive of other option plans for
its officers and Directors, and does not contemplate implementing any such
plans at this time.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Corporate Stock Transfer, Inc. will act as Transfer Agent for the
Common Stock of the Company. Carylyn K. Bell, a principal shareholder of the
Company, is an officer, Director and shareholder of Corporate Stock Transfer,
Inc.
ITEM 8. LEGAL PROCEEDINGS.
Neither the Company nor any of its management in their capacities as
such is the subject of any pending material legal proceedings.
ITEM 9. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND
OTHER SHAREHOLDER MATTERS.
MARKET PRICE
As of the date of this Registration Statement, and for the two (2)
preceding fiscal years, no public trading market for the Company's securities
has existed.
DIVIDENDS
No cash dividends were paid by the Company during the fiscal years
ended March 31, 1996 and 1997. The Company's Board of Directors does not
currently intend to pay any cash dividends.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES.
In February 1997, the Company issued an aggregate of 300,000 shares
of common stock to four (4) persons in consideration of services to the
Company valued at $15,000, or $.05 per share. Each of the four persons
qualified as an "accredited investor" within the meaning of the Act. The
shares were acquired for investment purposes and were subject to appropriate
transfer restrictions. The shares were not registered under the Act in
reliance upon Section 4(2) thereof.
ITEM 11. DESCRIPTION OF SECURITIES
The Company is authorized to issue up to 100,000,000 shares of $.05
par value Common Stock and up to 50,000,000 shares of $.10 par value Preferred
Stock. As of the date of this Registration Statement, 1,284,116 shares of
Common Stock and no shares of Preferred Stock were issued and outstanding.
COMMON STOCK.
Each holder of Common Stock of the Company is entitled to one (1)
vote for each share held of record. There is no right to cumulative votes for
the election of directors. The shares of Common Stock are not entitled to
pre-emptive rights and are not subject to redemption or assessment. Each
share of Common Stock is entitled to share ratably in distributions to
shareholders and to receive ratably such dividends as may be declared by the
Board of Directors out of funds legally available therefor. Upon liquidation,
dissolution or winding up of the Company, the holders of Common Stock are
entitled to receive, pro-rata, the assets of the Company which are legally
available for distribution to shareholders. The issued and outstanding shares
of Common Stock are validly issued, fully paid and non-assessable.
PREFERRED STOCK.
The Company is authorized to issue up to 50,000,000 shares of no par
value Preferred Stock. The preferred stock of the corporation can be issued
in one or more series as may be determined from time to time by the Board of
Directors without further stockholder approval. In establishing a series the
Board of Directors shall give to it a distinctive designation so as to
distinguish it from the shares of all other series and classes, shall fix the
number of shares in such series, and the preferences, rights and restrictions
thereof. All shares of any one series shall be alike in every particular.
All series shall be alike except that there may be variation as to the
following: (1) the rate of distribution, (2) the price at and the terms and
conditions on which shares shall be redeemed, (3) the amount payable upon
shares for distributions of any kind, (4) sinking fund provisions for the
redemption of shares, (5) the terms and conditions on which shares may be
converted if the shares of any series are issued with the privilege of
conversion, and (6) voting rights except as limited by law.
The Company currently does not have any plans to designate and issue
any series of Preferred Stock. The Company could authorize the issuance of a
series of preferred stock which would grant to holders preferred rights to the
assets of the Company upon liquidation, the right to receive dividend coupons
before dividends would be declared to common stockholders, and the right to
the redemption to such shares, together with a premium, prior to the
redemption of Common Stock. Common stockholders have no redemption rights.
In addition, the Board could issue large blocks of voting stock to fend
against unwanted tender offers or hostile takeovers without further
shareholder approval.
ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The only statute, charter provision, bylaw, contract, or other
arrangement under which any controlling person, director or officers of the
Company is insured or indemnified in any manner against any liability which he
may incur in his capacity as such, is as follows:
a. Article VIII of the Company's Restated Articles of
Incorporation with Amendments provides as follows:
The Corporation may and shall indemnify each
director, officer and any employee or agent of
the Corporation, his heirs, executors and
administrators, against any and all expenses or
liability reasonably incurred by him in
connection with any action, suit or proceeding
to which he may be a party by reason of his
being or having been a director, officer,
employee or agent of the Corporation to the full
extent required or permitted by the Colorado
Corporation Code, as amended.
b. Article XI of the Company's Restated Articles of Incorporation
with Amendments provides as follows:
DIRECTORS' LIABILITY
a. A director of this corporation shall not be
liable to the corporation or its stockholders
for monetary damages for breach of fiduciary
duty as a director, except to the extent that
such exemption from liability or limitation
thereof is not permitted under the General
Corporation Law of the State of Colorado as the
same exists or may hereafter be amended.
b. Any repeal or modification of the foregoing
paragraph A by the stockholders of the
corporation shall not adversely affect any right
or protection of a director of the corporation
existing at the time of such repeal or
modification.
The By-Laws of the Company, as amended, provide for the
indemnification of officers and Directors to the maximum extent allowable
under Colorado law. Insofar as the indemnification for liabilities arising
under the Securities Act of 1933, as amended, may be permitted to Directors,
officers or persons controlling the Company pursuant to such provisions, the
Company has been informed that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act
and is therefore unenforceable.
ITEM 13. FINANCIAL STATEMENTS.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
Effective June 12, 1996, the Board of Directors of the Company
decided to change the Company's independent accountant. The independent
accountant who was previously engaged as the principal accountant to audit the
Company's financial statements was Mitchell, Lander & Co., Certified Public
Accountants. The report of Mitchell, Lander & Co. covering the Company's 1996
consolidated financial statements contained a going concern qualification.
Other than the foregoing, none of the reports of Mitchell, Lander & Co.'s on
the financial statements of the Company for periods reported on by Mitchell,
Lander & Co., contained any adverse opinion or disclaimer of opinion, or was
qualified or modified as to uncertainty, audit scope, or accounting
principles. Nor have there been any disagreements between the Company and
Mitchell, Lander & Co. on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure.
The Company has retained the accounting firm of Schumacher and
Associates, Inc. to serve as the Company's principal accountant to audit the
Company's financial statements. This engagement was effective June 12, 1996.
Prior to its engagement as the Company's principal independent accountant,
Schumacher and Associates, Inc. had not been consulted by the Company either
with respect to the application of accounting principles to a specified
transaction or the type of audit opinion that might be rendered on the
Company's financial statements or on any matter which was the subject of any
prior disagreement between the Company and its previous certifying accountant.
ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS.
FINANCIAL STATEMENTS
--------------------
The following financial statements are filed as part of this report:
1. Report of Independent Certified Public Accountant;
2. Balance Sheet as of March 31, 1997 and June 30, 1997 (unaudited);
3. Statement of Operations for the years ended March 31, 1997 and 1996
and three months ended June 30, 1997 (unaudited);
4. Statement of Changes in Stockholders' Equity as of March 31, 1997
and June 30, 1997 (unaudited);
5. Statement of Cash Flow for the years ended March 31, 1997 and 1996
and three months ended June 30, 1997 (unaudited);
6. Notes to Financial Statements.
EXHIBITS
---------
Exhibit No. Title
- ---------- -----
3.1 Amended and Restated Articles of Incorporation
3.2 Amended and Restated By-Laws
* 16.0 Letter on change in certifying accountant.
- -----------------
* To be filed by Amendment
<PAGE>
<PAGE>
INDEX TO FINANCIAL STATEMENTS
VERSAILLES CAPITAL CORPORATION
------------------------------
FINANCIAL STATEMENTS
with
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
March 31, 1997 and 1996
June 30, 1997 and 1996 (Unaudited)
Report of Independent Certified Public Accountants F-2
Financial Statements:
Balance Sheet F-3
Statements of Operations F-4
Statement of Changes in Stockholders'
(Deficit) F-5
Statements of Cash Flows F-6
Notes to Financial Statements F-7
<PAGE>
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
--------------------------------------------------
The Board of Directors
Versailles Capital Corporation
Denver, CO 80202
We have audited the accompanying balance sheet of Versailles Capital
Corporation as of March 31, 1997, and the related statements of operations,
stockholders' equity and cash flows for the two years ended March 31, 1997.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements, referred to above, present fairly,
in all material respects, the financial position of Versailles Capital
Corporation as of March 31, 1997, and the results of its operations, changes
in its stockholders' equity and its cash flows for the two years ended March
31, 1997, in conformity with generally accepted accounting principles.
The accompanying balance sheet has been prepared assuming that the Company
will continue as a going concern. As described in Note 2 to the financial
statements, the Company has suffered recurring losses from operations and has
a net capital deficiency that raise substantial doubts about its ability to
continue as a going concern. The financial statements does not include any
adjustments that might result from the outcome of this uncertainty.
Schumacher & Associates, Inc.
Certified Public Accountants
12835 E. Arapahoe Road
Tower II, Suite 110
Englewood, Colorado 80112
April 23, 1997
<PAGE>
<PAGE>
<TABLE>
VERSAILLES CAPITAL CORPORATION
------------------------------
BALANCE SHEET
ASSETS
------
<CAPTION>
March 31, 1997 June 30, 1997
(Unaudited)
-------------- -------------
<S> <C> <C>
Current Assets: $ - $ -
Total Current Assets - -
-------------- -------------
TOTAL ASSETS $ - $
============== =============
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current Liabilities:
Accounts payable $ 10,194 $ 14,303
Advances from stockholders 2,000 7,461
-------------- -------------
Total Current Liabilities 12,194 21,764
-------------- -------------
TOTAL LIABILITIES 12,194 21,764
-------------- -------------
Commitments and
Contingencies (Note 2) - -
Stockholders' (Deficit):
Common Stock
$.0001 par value
6,000,000,000 shares
authorized 1,284,116
shares issued and
outstanding 64,206 64,206
Additional paid-in capital 447,691 447,691
Accumulated (deficit) (524,091) (533,661)
-------------- -------------
TOTAL STOCKHOLDERS' (DEFICIT) (12,194) (21,764)
-------------- ------------
TOTAL LIABILITIES AND
STOCKHOLDERS' (DEFICIT) $ - $ -
============== ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<PAGE>
<TABLE>
VERSAILLES CAPITAL CORPORATION
------------------------------
STATEMENTS OF OPERATIONS
<CAPTION>
Three Months
Ended June 30,
Years Ended March 31, 1997 1997
1997 1996 (Unaudited)
------------- ------------- -------------
<S> <C> <C> <C>
Revenue $ - $ - $ -
------------- ------------- -------------
Expenses:
Accounting 4,210 494 2,146
Other 16,061 1,460 7,424
------------- ------------- -------------
(20,271) (1,954) (9,570)
------------- ------------- -------------
Net (Loss) $ (20,271) $ (1,954) $ (9,570)
============= ============= =============
(Loss) Per Share $ (.02) $ nil $ (.01)
============= ============= =============
Weighted Average Shares
Outstanding 1,034,118 984,118 1,284,116
============= ============= =============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<PAGE>
<TABLE>
VERSAILLES CAPITAL CORPORATION
-------------------------------
STATEMENT OF CHANGES IN STOCKHOLDERS' (DEFICIT)
From March 31, 1995 through June 30, 1997 (Unaudited)
Preferred Stock Common Stock Additional
No./ No./ Paid-in Accumulated
Shares Amount Shares Amount Capital Deficit Total
---------- ----------- ---------- ----------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at
March 31, 1995 - $ - $ 984,118 $ 49,206 $ 447,691 $(501,866) $ (4,969)
Net loss-year for
the year ended
March 31, 1996 - - - - - (1,954) (1,954)
---------- ----------- ---------- ----------- ---------- ---------- -----------
Balance at
March 31, 1996 - - 984,118 49,206 447,691 (503,820) (6,923)
Common stock issued
for services - - 299,998 15,000 - - 15,000
Net loss for the
year ended
March 31, 1997 - - - - - (20,271) (20,271)
---------- ----------- ---------- ----------- ---------- ---------- -----------
Balance at
March 31, 1997 - - 1,284,116 64,206 447,691 (524,091) (12,194)
Net loss for the
three months
ended
June 30, 1997
(Unaudited) - - - - - (9,570) (9,570)
---------- ----------- ---------- ----------- ---------- ---------- -----------
Balance at
June 30, 1997
(Unaudited) - $ - - $ - $ 447,691 $(533,661) $ (21,764)
========== =========== ========== =========== ========== ========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<PAGE>
<TABLE>
VERSAILLES CAPITAL CORPORATION
------------------------------
STATEMENTS OF CASH FLOWS
<CAPTION>
Three Months
Ended June 30,
Years Ended March 31, 1997 1997
1997 1996 (Unaudited)
------------- ------------- -------------
<S> <C> <C> <C>
Cash Flows Operating
Activities:
Net loss $ (20,271) $ (1,954) $ (9,570)
Increase (decrease) in
accounts payable 5,271 (46) 4,109
Common stock issued for
services 15,000 - -
------------ ------------ ------------
Net Cash (Used in)
Operating Activities - (2,000) (5,461)
------------ ------------ ------------
Cash Flows from
Investing Activities - - -
------------ ------------ ------------
Cash Flows from Financing
Activities
Advances from stockholders - 2,000 5,461
------------ ------------ ------------
Net Cash Provided by
Financing Activities - 2,000 5,461
------------ ------------ ------------
(Decrease) in Cash - - -
Cash, Beginning of Year - - -
------------ ------------ ------------
Cash, End of Year $ - $ - $ -
============ ============ ============
Interest Paid $ - $ - $ -
============ ============ ============
Income Taxes Paid $ - $ - $ -
============ ============ ============
</TABLE>
The accompanying notes are an integral part of the financial statements.
<PAGE>
<PAGE>
VERSAILLES CAPITAL CORPORATION
------------------------------
NOTES TO FINANCIAL STATEMENTS
March 31, 1997 and 1996
June 30, 1997 and 1996 (Unaudited)
(1) Summary of Accounting Policies
------------------------------
This summary of significant accounting policies of Versailles Capital
Corporation (Company) is presented to assist in understanding the
Company's financial statements. The financial statements and notes are
representations of the Company's management who is responsible for their
integrity and objectivity. These accounting policies conform to
generally accepted accounting principles and have been consistently
applied in the preparation of the financial statements.
(a) Organization and Principles of Consolidation
--------------------------------------------
Versailles Capital Corporation (Company) was incorporated under the
laws of Colorado on December 31, 1986. The Company is an inactive
entity other than it is looking for a business combination
candidate.
The Company has selected the last day of March as its year end.
(b) Use of Estimates in the Preparation of Financial Statements
-----------------------------------------------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of
revenue and expenses during the reporting period. Actual results
could differ from those estimates.
(c) Unaudited Financial Statements
------------------------------
The balance sheet as of June 30, 1997, the statements of income and
cash flows for the three month period ended June 30, 1997, and the
statement of changes in stockholders' (deficit) for the three month
period ended June 30, 1997, have been prepared by management without
audit. In the opinion of management all adjustments (which included
only normal recurring adjustments) necessary present fairly the
financial position, results of operations and changes in financial
position at June 30, 1997 and for all periods presented have been
made.
<PAGE>
<PAGE>
VERSAILLES CAPITAL CORPORATION
------------------------------
NOTES TO FINANCIAL STATEMENTS
March 31, 1997 and 1996
June 30, 1997 and 1996 (Unaudited)
(2) Basis of Presentation - Going Concern
-------------------------------------
The accompanying financial statements have been prepared in conformity
with generally accepted accounting principles, which contemplates
continuation of the Company as a going concern. However, the Company has
sustained operating losses since its inception and has a net capital
deficiency. These matters raise substantial doubt about the Company's
ability to continue as a going concern. Management is attempting to
raise additional capital, and is looking for a business combination
candidate.
In view of theses matters, continuing as a going concern is dependent
upon the Company's ability to meet its financing
requirements, raise additional capital, and the success of its future
operations or completion of a successful business combination.
Management believes that actions planned and presently being taken to
revise the Company's operating and financial requirements provide the
opportunity for the Company to continue as a going concern.
(3) Income Taxes
------------
As of March 31, 1997, there are no current or deferred income taxes
payable. As of March 31, 1997, the Company has total deferred tax assets
of approximately $105,000 due to operating loss carryovers and the
depreciation timing differences described above. However, because of the
uncertainty of potential realization of these tax assets, the Company has
provided a valuation allowance for the entire $105,000. Thus, no tax
assets have been recorded in the financial statements as of March 31,
1997.
The Company has available at March 31, 1997, unused operating loss
carryovers of approximately $524,000 which may be applied against future
taxable income, expiring in various years through 2011. Change of
control could reduce or eliminate the ability to utilize the net
operation loss carryover.
(4) Advances from Stockholders
--------------------------
As of March 31, 1997 stockholders had advanced $2,000 to the Company.
The advances are uncollateralized, bear no interest and have no written
repayment terms. Included in accounts payable as of March 31, 1997 is
$4,990 payable to a stock transfer agency owned by an officer/shareholder
of the Company. Operating expenses during the years ended March 31, 1997
and 1996 included $1,061 and $1,460, respectively, of stock transfer fees
charged by the related party.
<PAGE>
<PAGE>
VERSAILLES CAPITAL CORPORATION
------------------------------
NOTES TO FINANCIAL STATEMENTS
March 31, 1997 and 1996
June 30, 1997 and 1996 (Unaudited)
(5) Stock Split
-----------
In November 1996, the Company effected a 1-for-500 reverse stock split
changing the par value per share from $.0001 to $.05 per share. All
references to number of shares have been restated to reflect this reverse
stock split.
<PAGE>
<PAGE> SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized.
VERSAILLES CAPITAL CORPORATION
Date: July 21, 1997 By: /s/ David C. Walters
-------------------------------
David C. Walters, President
<PAGE>
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
VERSAILLES CAPITAL CORPORATION
(Corporate Name as Amended)
Formerly
MAN O'WAR, INC.
(Current Name)
Pursuant to Colorado Revised Statues, Sec. 7-110-107, the undersigned
being the President and Secretary of Versailles Capital Corporation (corporate
name as amended), formerly Man O'War, Inc. (current corporate name) (the
"Company" or the "Corporation"), hereby affirm that the following Amended and
Restated Articles of Incorporation correctly set forth the provisions of the
Articles of Incorporation of the Company, as amended, as said Articles of
Incorporation have been approved by a vote of the shareholders of the Company
at a special meeting called for that purpose, on November 5, 1996 that the
number of shares which voted at said special meeting for the Amended and
Restated Articles of Incorporation was sufficient for such approval, and that
the following Amended and Restated Articles of Incorporation supersede the
original Articles of Incorporation and all amendments thereto.
ARTICLE I
NAME
The name of the corporation is to be "VERSAILLES CAPITAL CORPORATION".
ARTICLE II
TERMS OF EXISTENCE
The corporation shall exist in perpetuity, from and after the date of
filing this Certificate of Incorporation with the Secretary of State of the
State of Colorado, unless sooner dissolved or disincorporated according to
law.
ARTICLE III
OBJECT, PURPOSES AND POWERS
Section 1. General Objects and Purposes. To engage in any lawful
activity as may from time to time be authorized by the corporation's Board of
Directors, which is not prohibited by law or by these Articles of
Incorporation. To undertake such other activities as the Board of Directors
may deem reasonable or necessary in the furtherance of the general or specific
purposes and powers of the corporation.
Section 2. General Powers. Further, the corporation shall have and
may exercise all the rights, powers and privileges now or hereafter conferred
upon corporations organized under the laws of the State of Colorado and in
addition may do everything necessary, suitable, proper for, or incident to,
the accomplishment of any of these corporate purposes.
Section 3. Specific Purposes and Powers. Subject to any specific
written limitations or restrictions imposed by the Colorado Corporation Code
or by other law, or by these Articles of Incorporation, and not in limitation
of any of the statutory powers herein granted, the corporation shall have the
following purposes and exercise the following specific powers:
a. To Deal in Real Property. To acquire, hold, own, improve, manage,
operate, let as lessor, sell, convey or mortgage, or otherwise deal with,
either alone or in conjunction with others, real estate of every right, title
or interest, character and description whatsoever and wheresoever situated.
b. To Deal in Personal Property, Generally. To acquire, hold, own,
manage, operate, mortgage, pledge, hypothecate, exchange, sell, deal in and
dispose of, either alone or in conjunction with others, personal property and
commodities of every right, title or interest, character and description
whatsoever and wheresoever situated.
c. To Enter into Profit Sharing Arrangements and Partnerships. To
enter into any lawful arrangement for sharing profits, union of interest,
reciprocal association, or cooperative association with any corporation,
association, partnership, individual, or other legal entity for the carrying
on of any business, the purpose of which is similar to the Purposes set forth
in Section 1 of this Article, and to enter into any general or limited
partnership, the purpose of which is similar to such Purposes.
d. To Execute Guarantees. To make any guaranty respecting stocks,
dividends, securities, indebtedness, interest, contracts or other obligations
created by any individual, partnership, association, corporation, or other
entity, to the extent that such guaranty is made in pursuance to the Purposes
set forth in Section 1 of this Article.
e. To Borrow Funds. To borrow or raise monies for any of the Purposes
of the corporation set forth in Section 1 of this Article, and, from time to
time, without limit as to amount, to execute, accept, endorse, and deliver as
evidence of such borrowing, all kinds of securities, including, but without
limiting the generality thereof, promissory notes, drafts, bills of exchange,
warrants, bonds, debentures and other negotiable or non-negotiable instruments
and evidences of indebtedness; and to secure the payment and full performance
of such securities by mortgage on, or pledge, conveyance or assignment in
trust of, the whole, or any part of the assets of the corporation.
f. To Lend Funds. To lend money to individuals or other business
entities and to charge interest for the same and to engage in the business,
buying, loaning money upon, selling, transferring, assigning, discounting,
borrowing money upon and pledging as collateral, and otherwise dealing as
principal agent or broker in bills of lading, warehouse receipts, evidence of
deposit and storage of personal property, bonds, stocks, promissory notes,
commercial paper account, invoices, choses in action, interest in estates,
contracts, mortgages on real or personal property, pledges of personal
property and other evidence of indebtedness of persons, firms or corporations,
and owning, holding or conveying such real estate as may be necessary in the
operating of its business, and purchasing, acquiring and holding shares of
stock in other corporations, domestic and foreign, and doing all things
incidental thereto; to do a general brokerage business, to buy, sell and deal
in all kinds of listed and unlisted stocks and bonds on commission; not for
the purpose of carrying on the business of banking, insurance or the operation
of railroads or the discounting of bills and notes, or the buying and selling
of bills of exchange.
Section 4. All the foregoing listed powers and/or purposes of the
corporation are both purposes and powers of the corporation and shall be
construed as such.
ARTICLE IV
CAPITAL STOCK
Section 1. The total number of shares of capital stock which the
corporation shall have authority to issue is one hundred fifty million
(150,000,000) shares, of which one hundred million (100,000,000) shall be
designated common stock, having a par value of five cents ($.05) each, and of
which fifty million (50,000,000) shall be designated preferred stock of the
corporation, having a par value of ten cents ($.10) each. All or any part of
the common stock may be issued by the corporation from time to time and for
such consideration and on such terms as may be determined and fixed by the
Board of Directors, without action of the stockholders, as provided by law,
unless the Board of Directors deems it advisable to obtain the advice of the
stockholders. Said stock may be issued for money, property, services or other
things of value, and when issued shall be issued as fully paid and non-
assessable. The private property of stock holders shall not be liable for
corporation debts. Subject to the preferences, rights and restrictions which
may be ascribed to the preferred stock of the corporation by the Board of
Directors, the preferences and relative participating optional or other
special rights and qualifications, limitations or restrictions thereof of the
common stock of the corporation are as follows:
a. Dividends. Dividends may be paid upon the common stock, as and when
declared by the Board of Directors, out of funds of the corporation legally
available therefor.
b. Payment on Liquidation. Upon any liquidation, dissolution and
termination of the corporation, and after payment or setting aside of any
amount sufficient to provide for payment in full of all debts and liabilities
of, and other claims against the corporation, the assets shall be distributed
pro rata to the holders of the common stock.
c. Voting Rights. At any meeting of the stockholders of the
Corporation each holder of Common Stock shall be entitled to one vote for each
share outstanding in the name of such holder on the books of the Corporation
on the date fixed for determination of voting rights.
The stockholders, by vote or concurrence of a majority of the
outstanding shares of the Corporation entitled to vote on the subject matter,
may take any action which would otherwise require a two-thirds (2/3) vote
under the Colorado Corporation Code, as amended.
d. Cumulative Voting. Cumulative voting shall not be allowed in the
election of directors or for any other purpose.
e. Pre-Emptive Rights. Unless otherwise determined by the Board of
Directors, no stockholder of the corporation shall have pre-emptive rights to
subscribe for any additional shares of stock, or for other securities of any
class, or for rights, warrants or options to purchase stock for the scrip, or
for securities of any kind convertible into stock or carrying stock purchase
warrants or privileges.
f. Restrictions on Sale or Disposition. All lawful restrictions on the
sale or other disposition of shares may be placed upon all or a portion or
portions of the certificates evidencing the corporation's shares.
Section 2. The preferred stock of the corporation shall be issued in
one or more series as may be determined from time to time by the Board of
Directors. In establishing a series the Board of Directors shall give to it a
distinctive designation so as to distinguish it from the shares of all other
series and classes, shall fix the number of shares in such series, and the
preferences, rights and restrictions thereof. All shares of any one series
shall be alike in every particular. All series shall be alike except that
there may be variation as to the following: (1) the rate of distribution, (2)
the price at and the terms and conditions on which shares shall be redeemed,
(3) the amount payable upon shares for distributions of any kind, (4) sinking
fund provisions for the redemption of shares, and (5) the terms and conditions
on which shares may be converted if the shares of any series are issued with
the privilege of conversion, and (6) voting rights except as limited by law.
ARTICLE V
REGISTERED OFFICE AND AGENT
The address of the registered office of the corporation will be at 370
17th Street, Suite 2350, Denver, CO 80202. The name of the registered agent
at such address is Cindy R. Hintgen. The principal office of this corporation
and its principal place of business is the same address as that of the initial
registered office. The corporation may conduct part or all of its business in
the County of Boulder, or the State of Colorado, or the United States, or of
the world, and it may hold, purchase, mortgage, lease and convey real and
personal property in any of such places.
ARTICLE VI
DIRECTORS
The business and affairs of this corporation and the management thereof
shall be vested in a Board of Directors consisting of not less than one (1)
nor more than ten (10) members. Directors need not be stockholders of the
corporation.
The number of directors may be increased or decreased from time to time,
within the limits stated above, by action of the majority of the whole Board
of Directors.
ARTICLE VII
RIGHTS OF DIRECTORS, OFFICERS AND MANAGEMENT
TO CONTRACT WITH CORPORATION
No contract or other transaction between the corporations or any other
corporation whether or not a majority of the shares of capital stock of such
other corporation is owned by this corporation, and no act of this corporation
shall be in any way affected or invalidated by the fact that any of the
directors, officers or other members of the management of this corporation are
pecuniarily or otherwise interested in or are directors, officers or members
of management of such other corporation. Any director, officer or other
member of management of this corporation individually, or any firm of which
such director, officer or member of management may be a member, may be a party
to, or may be pecuniarily or otherwise interested in, any contract or
transaction of this corporation, provided, however, that the fact that he or
such firm is so interested shall be disclosed or shall have been known to the
Board of Directors of this corporation or a majority thereof. Any director of
this corporation who is also a director, officer or member of management of
such other corporation, or who is so interested, may be counted in determining
the existence of a quorum at any meeting of the Board of Directors of this
corporation that shall authorize such contract or transaction, and may vote at
any such meeting to authorize such contract or transaction, with like force
and effect as if he were not such director, officer or member of management of
such other corporation or not so interested.
ARTICLE VIII
INDEMNIFICATION
The Corporation may and shall indemnify each director, officer and any
employee or agent of the Corporation, his heirs, executors and administrators,
against any and all expenses or liability reasonably incurred by him in
connection with any action, suit or proceeding to which he may be a party by
reason of his being or having been a director, officer, employee or agent of
the Corporation to the full extent required or permitted by the Colorado
Corporation Code, as amended.
ARTICLE IX
CORPORATE OPPORTUNITIES
The officers, directors and other members of management of this
corporation shall be subject to the Doctrine of Corporate Opportunities only
insofar as it applies to business opportunities in which this corporation has
expressed an interest as determined from time to time by the corporation's
Board of Directors as evidenced by resolutions appearing in the corporation's
Minutes. When such areas of interest are delineated, all such business
opportunities within such areas or interests which come to the attention of
the officers, directors and other members of management of this corporation
shall be disclosed promptly to this corporation and made available to it. The
Board of Directors may reject any business opportunity presented to it and
therefore any officer, director or other member of management may avail
himself of such opportunity. Until such time as this corporation, through its
Board of Directors, has designated an area of interest, the officers,
directors and other members of management of this corporation shall be free to
engage in such areas of interest on their own and this Doctrine shall not
limit the rights of any officer, director or other member of this corporation
to continue a business existing prior to the time that such area of interest
is designated by this corporation.
ARTICLE X
PARTIAL LIQUIDATION
The Board of Directors may, from time to time, distribute to the
corporation's shareholders, in partial liquidation, out of stated capital or
capital surplus of the corporation, a portion of its assets, in cash or
properties if (a) at the time the corporation is solvent; (b) such
distribution would not render the corporation insolvent; (c) all cumulative
dividends on all preferred or special classes of shares entitled to
preferential dividends shall have been paid fully; (d) the distribution would
not reduce the remaining net assets of the corporation below the aggregate
preferential amount payable in the amount of voluntary liquidation to the
holders of shares having preferential rights to the assets of the corporation
in the event of liquidation; (e) the distribution is not made out of capital
surplus arising from unrealized depreciation of assets of re-evaluation of
surplus; (f) the distribution is identified as a distribution in partial
liquidation and the amount per share is disclosed to the shareholders
receiving the same concurrently with the distribution thereof.
ARTICLE XI
DIRECTORS' LIABILITY
a. A director of this corporation shall not be liable to the
corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director, except to the extent that such exemption from liability or
limitation thereof is not permitted under the General Corporation Law of the
State of Colorado as the same exists or may hereafter be amended.
b. Any repeal or modification of the foregoing paragraph A by the
stockholders of the corporation shall not adversely affect any right or
protection of a director of the corporation existing at the time of such
repeal or modification.
IN WITNESS WHEREOF, the President of Versailles Capital Corporation has
hereunto set his hand and seal this 21st day of July, 1997.
VERSAILLES CAPITAL CORPORATION
/s/ Cindy R. Hintgen /s/ David C. Walters
- --------------------------------- ----------------------------------
Cindy R. Hintgen, Registered Agent David C. Walters, President
ATTEST:
/s/ Cindy R. Hintgen
- ---------------------------------
Cindy R. Hintgen, Secretary
STATE OF TEXAS )
) ss.
COUNTY OF DALLAS )
I, T. Q. THOMPSON, a Notary Public, hereby certify that on the 21st day
of July, 1997, personally appeared before me David C. Walters as President of
Versailles Capital Corporation, who, being by me first duly sworn, severally
declared that he was the persons who signed the foregoing document and that
the statements therein contained are true.
My commission expires: April 25, 2001
Business Address: 1801 N. Hampton Ste 200
DeSoto Texas 75115
T.Q THOMPSON
Notary Public
State of Texas
Expires
04-25-2001
/s/ T. Q. Thompson
-------------------------------------
Notary Public
<PAGE>
AMENDED AND RESTATED
BY-LAWS OF
VERSAILLES CAPITAL CORPORATION
ARTICLE I
Section 1. The following paragraphs contain provisions for the
regulation and management of VERSAILLES CAPITAL CORPORATION, a Colorado
corporation.
Section 2. In the event that there is a conflict between a provision of
these By-Laws and a mandatory provision of the Articles of Incorporation of
this corporation, then said mandatory provision of the Articles of
Incorporation of this corporation shall control.
ARTICLE II
PLACE OF BUSINESS
Section 1. The registered office of the corporation, which shall also be
the principal office of said corporation, shall be 370 17th Street, Suite
2350, Denver, Colorado 80202. This designation shall be without prejudice to
the power and right of the corporation to conduct and transact any of its
affairs or business in other cities, states, territories, countries, or
places.
Section 2. The registered agent of the corporation in the State of
Colorado shall be Cindy R. Hintgen.
Section 3. The registered office and registered agent of the corporation
may be changed from time to time in the manner prescribed by law without
amending these By-Laws.
ARTICLE III
OFFICERS
Section 1. Number. The officers of this corporation shall consist of a
President, a Secretary, a Treasurer, and such other officers, including one or
more Vice Presidents, and, if desired, a Chief Executive Officer, as may be
appointed in accordance with the provisions of Section 3 of this Article. One
person may hold any two of said offices, but no such officer shall execute,
acknowledge, or verify any instrument in more than one capacity if such
instrument is required by law or by these By-Laws or by a resolution of the
Board of Directors to be executed, acknowledged or verified by any two or more
officers.
Section 2. Election, Term of Office and Qualifications. The officers of
this corporation shall be chosen annually by the Board of Directors. Each
officer, except such officer as may be appointed in accordance with the
provisions of Section 3 of this Article, shall hold his office until his
successors shall have been removed in the manner hereinafter provided.
Section 3. Subordinate Officers. The Board of Directors may appoint
such other officers to hold office for such period, have such authority and
perform such duties as the Board of Directors may from time to time determine.
The Board of Directors may delegate to any officer the power to appoint any
such subordinate officers.
Section 4. Removal. Any officer or agent elected or appointed by the
Board of Directors may be removed by the Board of Directors whenever in its
judgment the best interests of the corporation would be served thereby, but
such removal shall be without prejudice to the contract rights, if any, of the
person so removed. Such removal shall be by vote of a majority of the whole
Board of Directors at a regular meeting or a special meeting of the Board of
Directors called for this purpose.
Section 5. Resignations. Any officer may resign at any time by giving
written notice to the Board of Directors or to the President or Secretary of
the corporation. Any such resignation shall take effect at the time specified
therein; and, unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
Section 6. Chief Executive Officer. The Chief Executive Officer shall
be the principal executive officer of the corporation and, subject to the
control of the Board of Directors, shall in general supervise and control all
of the business and affairs of the corporation. He shall preside at all
meetings of the shareholders and all meetings of the Board of Directors; and
shall have general supervision over the affairs of the corporation and over
the other officers.
Section 7. President. The President shall be the chief operating
officer of the corporation. The President shall perform all duties incident
to the office of the President; shall sign all stock certificates and written
contracts of the corporation; and shall perform all such other duties as are
assigned to him from time to time by resolution of the Board of Directors or
the Chief Executive Officer.
Section 8. Vice President. In the absence of the President or in the
event of his death, inability or refusal to act, the Vice President shall
perform the duties of the President, and when so acting, shall have all the
powers of, and be subject to, all of the restrictions upon the President. The
Vice President shall perform such other duties as from time to time may be
assigned to him by the President or by the Board of Directors.
Section 9. Secretary. The secretary shall be sworn to the faithful
discharge of his duty. He shall:
a. Keep the minutes of the meetings of the shareholders and of the
Board of Directors in books provided for that purpose;
b. See that all notices are duly given in accordance with the
provisions of these By-Laws or as required by law;
c. Be custodian of the records and of the seal of the corporation and
see that such seal is affixed to all stock certificates prior to
their issue and to all documents, the execution of which on behalf
of the corporation under its seal is duly authorized in accordance
with the provisions of these By-Laws.
d. Have charge of the stock books of the corporation and keep or cause
to be kept the stock and transfer books in such manner as to show at
any time the amount of the stock of the corporation issued and
outstanding, the manner in which and the time when such stock was
paid for, the names, alphabetically arranged, and the addresses of
the holders of record; and exhibit during the usual business hours
of the corporation to any director, upon application, the original
or duplicate stock ledger;
e. Sign with the President, or a Vice President, certificates of stock
of the corporation;
f. See that the books, reports, statements, certificates, and all other
documents and records of the corporation required by law are
properly kept and filed;
g. In general, perform all duties incident to the office of Secretary
and such other duties as, from time to time, may be assigned to him
by the Board of Directors or by the President.
Section 10. Treasurer. The Treasurer shall:
a. Have charge and custody of, and be responsible for, all funds and
securities of the corporation;
b. From time to time render a statement of the condition of the
finances of the corporation at the request of the Board of
Directors;
c. Receive and give receipt for monies due and payable to the
corporation from any source whatsoever;
d. In general, perform all duties incident to the office of Treasurer,
and such other duties as from time to time may be assigned to him by
the Board of Directors or by the President.
Section 11. Salaries. Salaries of the officers shall be fixed from time
to time by the Board of Directors and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a Director of the
corporation.
ARTICLE IV
DIRECTORS
Section 1. General Powers. The business and affairs of this corporation
and the management thereof shall be vested in a Board of Directors consisting
of not less than one (1) nor more than ten (10) members.
Section 2. Number and qualification. The number of directors of this
corporation shall be not less than one (1) and not more than ten (10). The
number of directors may be increased or decreased from time to time within the
limits stated above by the action of the majority or the whole Board of
Directors. Directors shall be elected for a term of one (1) year and shall
serve until the election and qualification of their successors, unless they
sooner resign. At the first annual meeting of the stockholders and at each
annual meeting thereafter, the stockholders shall so elect directors to hold
office until the next succeeding annual meeting. The directors need not be
residents of the State of Colorado or stockholders of the corporation.
Section 3. Executive Committee. The Board of Directors by resolution
passed by a majority of the whole Board may designate two or more of their
number to constitute an executive committee, which shall have and exercise,
subject to limitations, if any, as may be prescribed herein or by resolution
of the Board of Directors, the powers of the Board of Directors and the
management of the business and affairs of the corporation; provided such
executive committee shall act only at such times as the Board of Directors is
not in session and in no event to the exclusion of the Board of Directors at
any time to act as a Board upon any business of the corporation.
Section 4. Vacancy. Any director may resign at any time by giving
written notice to the President or to the Secretary of the corporation. Such
resignation shall take effect at the time specified therein; and unless
otherwise specified therein, the acceptance of such resignation shall not be
necessary to make it effective. Any vacancy occurring in the Board of
Directors maybe filled by the affirmative majority vote of the whole Board of
Directors. A director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office. A director chosen to fill a
position resulting from a vacancy or an increase in the number of directors
shall hold office until the next annual meeting of stockholders.
Section 5. Removal. Any director may be removed from office, either
with or without cause, at any time, and another person may be elected to his
place, to serve for the remainder of his term, at any special meeting of
shareholders called for that purpose, by a majority of all of the shares of
stock outstanding and entitled to vote. In case any vacancy so created shall
not be filled by the shareholders at such meeting, such vacancy may be filled
by the affirmative vote of a majority of the remaining directors though less
than a quorum.
Section 6. Meetings. The regular meeting of the Board of Directors
shall be held immediately following the annual shareholder's meeting. The
Board of Directors shall meet at such other time or times as they may from
time to time determine.
Section 7. Special Meetings. Special meetings of the Board of Directors
may be called by or at the request of the President or any two directors. The
person or persons authorized to call special meetings of the Board of
Directors may fix the place for holding any special meeting of the Board of
Directors called by them.
Section 8. Place of Meetings. The Board of Directors may hold its
meetings at such place or places within or without the State of Colorado as
the Board may from time to time determine, or, with respect to its meetings,
as shall be specified or fixed in respective notices or waivers of notice of
such meetings.
Section 9. Special Meetings: Notice. Special meetings of the Board of
Directors shall be held whenever called by the President or by two of the
directors. Notice of the time and place of holding said special meeting of
the Board of Directors shall be given to each director by either
(i) registered mail, return receipt requested, deposited in the mail at least
ten (10) days prior to the date of said special meeting, or (ii) guaranteed
overnight delivery by a nationally-used courier service at least three (3)
days prior to the date of said special meeting, or (iii) by telex or facsimile
copy sent at least forty-eight (48) hours prior to the time and date of such
special meeting. Attendance of a director at such special meeting shall
constitute a waiver of notice of such special meeting, except where a director
attends the meeting for the express purpose of objecting to the transacting of
any business because the meeting is not lawfully called or convened. Neither
the business to be transacted at, nor the purpose of, any regular meeting or
special meeting of the Board of Directors need be specified in the notice or
waiver of notice of such meeting.
Section 10. Presence of Meetings. Members of the Board, or of any
committee thereof, may participate in a meeting of the Board or such committee
by means of conference telephone or similar communications equipment, by means
of which all persons participating in the meeting can hear one another.
Participation in a meeting pursuant to this Section 10 shall constitute
presence in person at such meeting.
Section 11. Quorum and Manner of Acting. A majority of the members of
the Board of Directors shall form a quorum for the transaction of business at
any regular or special meeting of the Board of Directors. The act of the
majority of the directors present at a meeting at which a quorum is present
shall be the act of the Board of Directors. If the vote of a lesser number is
required for a specific act by the Articles of Incorporation, or by another
provision of these By-Laws, then that lesser number shall govern. In the
absence of a quorum, a majority of the directors present may adjourn the
meeting from time to time until a quorum be had.
Section 12. Compensation. By resolution of the Board of Directors, the
directors may be paid their expenses, if any, for attendance at each meeting
of the Board of Directors and may be paid a fixed sum for attendance at each
meeting of the Board of Directors or a stated salary as director. No such
payment shall preclude any director from serving the corporation in any other
capacity and receiving compensation therefor.
Section 13. Election of Officers. At the first meeting of the Board of
Directors after the annual election, the President, Vice President, and
Secretary and Treasurer shall be elected to serve for the ensuing year and
until the election of their respective successors, and an executive committee
may be elected. Election shall be by ballot, and the majority of the votes
cast shall be necessary to elect. Any vacancies that occur may be filled by
the Board of Directors for the unexpired term. An officer may be removed at
any time by the majority vote of the directors present at any regular or
special meeting of said Board of Directors at which a quorum is present. The
Board of Directors shall have the power to fill officer vacancies, create new
officer positions, and adjust salaries of officers as said Board from time to
time shall deem necessary, all in accordance with the Articles of
Incorporation.
Section 14. Reporting. At each annual stockholder's meeting, the
directors shall submit a statement of business done during the preceding year,
together with a report of the general financial condition of the corporation,
and of the condition of its tangible property.
ARTICLE V
BOOKS AND RECORDS
Section 1. The corporation shall keep either within or without the State
of Colorado, complete books and records of account and shall keep minutes of
the proceedings of its stock holders and the Board of Directors.
Section 2. The corporation shall keep at its registered office or
principal place of business, a record of its stock holders, giving the names
and addresses of all of the stock holders and the number and class of the
shares held by each.
Section 3. The books, records of account, financial statements and other
documents of the corporation shall be available to such persons who have been
designated by law as having a right thereto, and said books, records of
account, financial statements and documents shall be made available to such
persons in the manner and in accordance with the procedures established by
law.
ARTICLE VI
STOCK
Section 1. Authorization. The authorized shares of stock of the
corporation shall be as provided by the Amended and Restated Articles of
Incorporation. Each share of common stock shall have $.05 par value and each
share of preferred stock shall have $.10 par value.
Section 2. Certificate of Shares. The shares of stock of the
corporation shall be represented by certificates signed by the Chief Executive
Officer, President or the Vice President and the Secretary or an assistant
Secretary of the corporation, and may be sealed with the seal of the
corporation or a facsimile thereof. The signatures of the President or Vice
President and the Secretary or Assistant Secretary upon a certificate may be
facsimile if the certificate is countersigned by a transfer agent, or
registered by a registrar, other than the corporation itself or an employee of
the corporation. In case any officer who has signed or whose facsimile
signature has been placed upon such certificate shall have ceased to be such
officer before such certificate is issued, it may be issued by the corporation
with the same effect as if he were such officer at the date of its issue.
Section 3. Issuance of Certificates. Each certificate representing
shares shall state upon the face of same that the corporation is organized
under the laws of the State of Colorado, the name of the person to whom the
certificate is issued, the number and class of shares, and the designation of
the series, if any, which such certificate represents. No certificate shall
be issued for any shares until such shares are fully paid and when issued
shall bear the notation that the certificate is issued as a fully paid and
non-assessable certificate of stock.
Section 4. Transfer of Shares. Transfer of shares of the corporation
shall be made only on the stock transfer books of the corporation by the
holder of record thereof or by his legal representative, who shall furnish
proper evidence of authority to transfer, or by his attorney thereunto
authorized by power of attorney duly executed and filed with the secretary of
the corporation, and on surrender for cancellation of the certificate for such
shares. Upon surrender to the corporation or to a transfer agent of the
corporation of a certificate of stock duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, it shall be the
duty of the corporation to issue a new certificate to the person entitled
thereto, and cancel the old certificate. Every such transfer of shares shall
be entered on the stock book of the corporation which shall be kept at its
principal office, or by its registrar duly appointed.
Section 5. Transfer Agent. The secretary of the corporation shall act
as transfer agent of the certificates representing the shares of the
corporation. The Secretary shall maintain a stock transfer book, the stubs in
which shall set forth, among other things, the names and addresses of the
holders of all issued shares of the corporation, the number of shares held by
each, the certificate numbers representing such shares, the date of issue of
the certificates representing such shares, and whether or not such shares
originate from original issue or from transfer. The names and addresses of
the shareholders as they appear on the stubs of the stock transfer book shall
be conclusive evidence as to who are the shareholders of record and as such
entitled to receive notice of the meetings of shareholders; to vote at such
meetings; to examine the list of the shareholders entitled to vote at
meetings; to receive dividends; and to own, enjoy and exercise any other
property rights deriving from such shares against the corporation. Each
shareholder shall be responsible for notifying the secretary in writing of any
change in his name or address and failure so to do will relieve the
corporation, its directors, officers and agents, from liability for failure to
direct notices or other documents, or to pay over or transfer dividends or
other property or rights, to a name and address other than the name and
address appearing on the stub of the stock transfer book.
The Board of Directors may at its discretion, appoint instead of the
secretary of the corporation, one or more transfer agents, registrars and
agents outside the corporation for making payment upon any class of stock,
bond, debenture, or other security of the corporation. Such agents and
registrars may be located either within or outside the State of Colorado.
They shall have such rights and duties and shall be entitled to such
compensation as may be agreed.
Section 6. Fractional Shares. The corporation may, but shall not be
obliged to, issue a certificate for a fractional share, and by action by its
Board of Directors, may issue in lieu thereof scrip in register or bearer form
which shall entitle the holder to receive a certificate for a full share upon
the surrender of such scrip aggregated to a full share. The rights and
obligations of persons holding said fractional shares or scrip shall be as are
contained in any applicable provision of these By-Laws, Articles of
Incorporation, or laws of the State of Colorado.
Section 7. Treasury Shares. Treasury shares of stock shall be held by
the corporation subject to the disposal of the Board of Directors and shall
neither vote nor participate in dividends.
Section 8. Lien. The corporation shall have a first lien on all shares
of its stock and upon all dividends declared upon same for any indebtedness of
the respective holders thereof of the corporation.
Section 9. Lost Certificates. In cases of loss or destruction of a
certificate of stock, no new certificates shall be issued in lieu thereof
except upon satisfactory proof to the Board of Directors of such loss or
destruction, and, at the election of a majority of the Board of Directors,
upon giving satisfactory security by bond or otherwise, against loss to the
corporation. Any such new certificate shall be plainly marked "Duplicate" on
its face.
Section 10. Consideration and Payment for Shares. Shares having a par
value shall be issued for such consideration, expressed in dollars but not
less than the par value thereof, as shall be fixed from time to time by the
Board of Directors. Shares without par value shall be issued for such
consideration expressed in dollars as shall be fixed from time to time by the
Board of Directors. Treasury shares shall be disposed of for such
consideration expressed in dollars as may be fixed from time to time by the
Board of Directors. Such consideration may consist, in whole or in part, of
money, other property, tangible or intangible, or labor or services actually
performed for the corporation, but neither promissory notes nor future
services shall constitute payment or part payment for shares.
ARTICLE VII
SHAREHOLDERS
Section 1. Annual Meeting. The regular meeting of the shareholders of
the corporation shall be held at a time and place to be designated by the
President, Vice President, or the Board of Directors, provided, however, that
whenever such day shall fall upon a Sunday or a legal holiday, the meeting
shall be held on the next succeeding business day. At the regular annual
meeting of the shareholders, the directors for the ensuing year shall be
elected. The officers of the corporation shall present their annual reports
and the Secretary shall have on file for inspection and reference, an
authentic list of the stockholders, giving the amount of stock held by each as
shown by the stock books of the corporation ten (10) days before the annual
meeting.
Section 2. Special Meeting. Special meetings of the shareholders may be
called at any time by the President, any member of the Board of Directors, or
by the holders of not less than ten (10%) percent of all of the shares
entitled to vote at said special meeting. The Board of Directors may
designate any place as the place for any annual meeting or for any special
meeting called by the Board of Directors. If a special meeting shall be
called otherwise than by the Board of Directors, the place of meeting shall be
the principal office of the corporation.
Section 3. Notice of Meetings. Written or printed notice stating the
place, day and hour of the meeting, and in case of special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not
less than ten (10) nor more than fifty (50) days before the date of the
meeting, either personally, or by mail, by or at the discretion of the
President, the Secretary, or the director or the person calling the meeting,
to each stockholder of record entitled to vote at such meeting, except that if
the authorized capital stock is to be increased, at least thirty (30) days
notice shall be given. If mailed, such notice shall be deemed to be delivered
when deposited in the U.S. Mails and addressed to the stockholder at his
address as it appears on the stock transfer books of the corporation, with
postage thereon prepaid.
Section 4. Closing Transfer Books. For the purpose of determining
shareholders entitled to notice of or to vote at any meeting of shareholders
or any adjournment thereof, or shareholders entitled to receive payment of any
dividend, or in order to make a determination of shares for any other purpose,
the Board of Directors may provide that the stock transfer books shall be
closed for any stated period not exceeding fifty (50) days. If the stock
transfer books shall be closed for the purpose of determining shareholders
entitled to notice of or to vote at a meeting of shareholders, shall be closed
for at least ten (10) days immediately preceding such meeting. In lieu of
closing the stock transfer books, the Board of Directors may fix in advance a
date as the record date for any such determination of such shareholders, such
date in any case to be not more than fifty (50) days and in the case of a
meeting of shareholders, not less than ten (10) days prior to the date on
which the particular action, requiring such determination of shareholders, or
shareholders entitled to receive payment of a dividend, the day on which
notice of the meeting is mailed or the date on which the resolution of the
Board of Directors declaring such dividend is adopted, as the case may be,
shall be the record date for such determination of shareholders. When a
determination of shareholders entitled to vote at any meeting of shareholders
has been made as provided in this section, such a determination shall apply to
any adjournment thereof. The officer or agent having charge of the stock
transfer books for shares of the corporation shall make, at least ten (10)
days before each meeting of shareholders, a complete list of shareholders
entitled to vote at any such meeting, or any adjournment thereof, arranged in
alphabetical order, with the address of and the number of shares held by each,
which list for a period of ten (10) days prior to such meeting, shall be kept
on file at the principal office of the corporation. The original stock
transfer books shall be prima facie evidence as to who are the shareholders
entitled to examine such list or transfer books or to vote at any meeting of
shareholders.
Section 5. Election of Directors. At each annual meeting of the
shareholders of the corporation, the directors shall be elected who shall
serve until their successors are duly elected and qualified, unless they
sooner resign. Election of directors shall be by such of the shareholders as
attend the annual meeting, either in person or by proxy, provided that if the
majority of stock is not represented, said meeting may be adjourned by the
shareholders present for a period not exceeding sixty (60) days at any one
adjournment. At each election of directors, cumulative voting shall not be
allowed.
Section 6. Quorum. A majority of the outstanding stock exclusive of
treasury stock, shall be necessary to constitute a quorum at meetings of the
shareholders. If a quorum is present at any meeting, a majority of the stock
represented there shall decide any question which is brought before such
meeting, except in those cases where it is otherwise provided by law. In the
absence of a quorum, those present may adjourn the meeting from day to day but
not exceeding sixty (60) days.
Section 7. Proxies. Any shareholder entitled to vote may be represented
at any regular or special meeting of the shareholders by a duly executed
proxy.
ARTICLE VIII
WAIVER OF NOTICE
Section 1. Directors and Officers. Unless otherwise provided by law,
whenever any notice is required to be given to any director or officer of the
corporation under the provisions of these By-Laws or under the provisions of
the Articles of Incorporation, a waiver thereof in writing, signed by the
person or persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.
Section 2. Shareholders. No notice of the time, place or purpose of any
annual, regular, or special meeting of the shareholders need be given if all
shareholders of record on the date said meeting is held waive such notice in
writing either before or after the regular, or special meeting of the
shareholders, such meeting shall be deemed to have been legally and duly
called, noticed, held, and conducted.
ARTICLE IX
ACTION WITHOUT A MEETING
Section 1. Any action required by the laws of the State of Colorado, the
Articles of Incorporation, or by these By-Laws, to be taken at a meeting of
the directors or stockholders of this corporation, or any action which may be
taken at a meeting of the directors or stockholders, may be taken without a
meeting if a consent in writing, setting forth the action so taken, shall be
signed by all the directors or stockholders entitled to vote with respect to
the subject matter thereof. Such consent shall have the same force and effect
as a unanimous vote of the directors or stockholders, and may be stated as
such in any Articles or documents filed with the Secretary of State under the
law of the State of Colorado.
ARTICLE X
CONTRACT, LOANS, CHECKS AND DEPOSITS
Section 1. Contracts. The Board of Directors may authorize any officer
or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the corporation, and
such authority may be general or confined to specific instances.
Section 2. Loans. No loans shall be contracted on behalf of the
corporation and no evidences of indebtedness shall be issued in its name
unless authorized by a resolution of the Board of Directors. Such authority
may be general or confined to specific instances.
Section 3. Checks, Drafts, Etc. All checks, drafts or other orders for
the payment of money, notes or other evidences of indebtedness issued in the
name of the corporation shall be signed by such officer or officers, agent or
agents of the corporation and in such manner as shall from time to time be
determined by resolution of the Board of Directors.
Section 4. Deposits. All funds of the corporation not otherwise
employed shall be deposited from time to time to the credit of the corporation
in such banks, trust companies or other depositories as the Board of Directors
may select.
ARTICLE XI
EXECUTION OF INSTRUMENTS
Section 1. Execution of Instruments. The President shall have power to
execute on behalf and in the name of the corporation any deed, contract, bond,
debenture, note or other obligations or evidences or indebtedness, or proxy,
or other instrument requiring the signature of an officer of the corporation,
except where the signing and execution thereof shall be expressly delegated by
the Board of Directors to some other officer or agent of the corporation.
Unless so authorized, no officer, agent or employee shall have any power or
authority to bind the corporation in any way, to pledge its credit or to
render it liable pecuniarily for any purpose or in any amount.
Section 2. Checks and Endorsements. All checks and drafts upon the
funds to the credit of the corporation in any of its depositories shall be
signed by such of its officers or agents as shall from time to time be
determined by resolution of the Board of Directors which may provide for the
use of facsimile signatures under specified conditions, and all notes, bills
receivable, trade acceptances, drafts, and other evidences of indebtedness
payable to the corporation shall, for the purposes of deposit, discount or
collection, be endorsed by such officers or agents of the corporation or in
such manner as shall from time to time be determined by resolution of the
Board of Directors.
ARTICLE XII
LOANS TO DIRECTORS AND OFFICERS
Loans to employees or officers of the corporation, guarantees of their
obligations or other similar assistance to these employees or officers (except
those employees or officers who are directors of the corporation), shall be
contracted on behalf of the corporation only upon the specific authorization
of the Board of Directors of the corporation. Unless otherwise provided in
the Articles of Incorporation, loans to directors, guarantees of their
obligations, or other similar assistance to the directors shall be contracted
on behalf of the corporation only upon the specific authorization of the Board
of Directors and the affirmative vote of the holders of two-thirds (2/3) of
the outstanding shares of the corporation which are entitled to vote for
directors. No such loans or guarantees shall be secured by the shares of this
corporation.
ARTICLE XIII
MISCELLANEOUS
Section 1. Corporate Seal. The Board of Directors shall provide a
corporate seal which shall be circular in form and shall have inscribed
thereon the name of the corporation, the state of incorporation, and the words
"Corporate Seal".
Section 2. Fiscal Year. The fiscal year of the corporation shall be as
established by the Board of Directors.
Section 3. Amendments. Subject to repeal or change by action of the
shareholders, the Board of Directors shall have the power to alter, amend, or
repeal the by-laws of the corporation and to make and adopt new by-laws at any
regular meeting of the Board or at any special meeting called for that
purpose.
Section 4. Dividends. The Board of Directors may, from time to time,
declare, and the corporation may pay, dividends on its outstanding shares in
the manner and upon the terms and conditions provided by law and its Articles
of Incorporation.
ADOPTED BY THE BOARD OF DIRECTORS this 5th day of November, 1996.
/s/ David C. Walters
------------------------------------
David C. Walters
/s/ William Maury Bell
-------------------------------------
William Maury Bell
/s/ Cindy R. Hintgen
-------------------------------------
Cindy R. Hintgen
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