Articles of Incorporation and Bylaws to be in Effect After the
Domicile Change
Following
the Domicile Change, we will be subject to the Articles of
Incorporation and Bylaws of the Company in Wyoming.
Significant Differences Between the Corporation Laws of Nevada and
Wyoming
The
rights and preferences of our stockholders are presently governed
by the Nevada Revised Statutes. Upon the Domicile Change of the
Company under the laws of the State of Wyoming, the rights and
preferences of our stockholders will be governed by the Wyoming
Business Corporation Act. Although Wyoming and Nevada corporation
laws currently in effect are similar in many respects, certain
differences will affect the rights of our stockholders once the
Domicile Change is completed. The following discussion summarizes
the primary differences considered by management to be significant
and is qualified in its entirety by reference to the full text of
the Nevada Revised Statutes and Wyoming Business Corporation
Act.
Stockholder Voting
Under
both Nevada law and Wyoming law, action on certain matters,
including the sale, lease or exchange of all or substantially all
of the corporation’s property or assets other than in the
usual and regular course of business, mergers and consolidations,
and voluntary dissolution, must be approved by the holders of a
majority of the outstanding shares. In certain cases, the
affirmative vote of the holders of at least a majority of the
shares of each class of shares entitled to vote as a class may be
required to effectuate the proposed action.
Authorized Shares
Under
Nevada Law, a corporation is required to state in its Articles of
Incorporation the number of shares the corporation is authorized to
issue and, if more than one class of stock is authorized, the
classes, the series and the number of shares of each class or
series which the corporation is authorized to issue, unless the
articles authorize the board of directors to fix and determine in a
resolution the classes, series and numbers of each class or series.
The Company’s Nevada Articles of Incorporation authorize the
issuance of 1,500,000,000 shares of common stock, $0.001 par value
and 10,000,000 shares of preferred stock, $0.001 par
value.
Under
Wyoming law, the Articles of Incorporation may authorize an
unlimited amount of shares of each class and series that the
corporation is authorized to issue. If more than one class or
series of shares is authorized, the Articles of Incorporation shall
prescribe a distinguishing designation for each class or series,
and shall prescribe, prior to the issuance of shares of a class or
series, the terms, including preferences, rights and limitations of
that class or series. Except to the extent varied as permitted by
Wyoming law, all shares of a class or series shall have terms,
including preferences, rights, and limitations that are identical
with those of other shares of the same class or series. The
Company’s Wyoming Articles of Incorporation will authorize
the issuance of an unlimited number of shares of common stock,
$0.001 par value and 10,000,000 shares of preferred stock, $0.001
par value.
Appraisal Rights in Connection with Corporate Reorganizations and
Other Actions
Under
Nevada law and Wyoming law, stockholders have the right, in some
circumstances, to dissent from certain corporate transactions by
demanding payment in cash for their shares equal to the fair value
of the shares as determined by the corporation or by a court in the
event a dissenting stockholder does not agree with the fair value
established by the corporation.
Nevada
law, in general, entitles a stockholder to dissent from, and to
obtain payment of the fair market value of his, her or its shares,
upon: (i) certain acquisitions of a controlling interest in the
corporation; (ii) consummation of a plan of merger, if approval by
the stockholders is required and the stockholder is entitled to
vote on the merger or if the domestic corporation is a subsidiary
and is merged with its parent; (iii) a plan of exchange in which
the corporation is a party; or (iv) any corporate action taken
pursuant to a vote of the stockholders, if the Articles of
Incorporation, Bylaws or a resolution of the board of directors
provides that voting or nonvoting stockholders are entitled to
dissent and obtain payment for their shares.
Under
Wyoming law, a stockholder is generally entitled to appraisal
rights, and to obtain payment of the fair value of his shares in
the event of any of the following corporate actions: (i)
consummation of a plan of merger or consolidation in which
stockholder approval is required or where the corporation is a
subsidiary that is merged with its parent; (ii) consummation of a
share exchange to which the corporation is a party as the
corporation whose shares will be acquired, if the stockholder is
entitled to vote on the exchange; (iii) certain dispositions of
assets if the stockholder is entitled to vote on such disposition;
(iv) certain amendments to the Articles of Incorporation; (v) any
amendment to the Articles of Incorporation, merger, share exchange,
or disposition of assets if specifically provided for in the
Articles of Incorporation, Bylaws, or resolution of the board of
directors; (vi) a transfer or domestication if the stockholder does
not receive shares in the foreign corporation resulting from the
transfer or domestication that have terms as favorable to the
stockholder in all material respects, and represent at least the
same percentage interest of the total voting rights of the
outstanding shares of the corporation, as the shares held by the
stockholder before the transfer or domestication; (vii) a
conversion of the corporation to non-profit status; or (viii) a
conversion of the corporation to an unincorporated
entity.
In
Nevada and Wyoming, a court in an appraisal proceeding may assess
the costs of the proceeding against the corporation, except that
the court may assess costs against all or some of the stockholders
demanding appraisal, in amounts the court finds equitable, to the
extent the court finds the stockholders demanding appraisal rights
acted arbitrarily, vexatiously, or not in good faith.
Neither
the Articles of Incorporation of the Company in Nevada nor the
Articles of Incorporation of the Company in Wyoming modify the
statutory appraisal rights provided in Nevada and Wyoming
law.
Action by Stockholders Without a Meeting
Under
Nevada law, unless otherwise provided in the Articles of
Incorporation or the Bylaws, any action required or permitted to be
taken at a meeting of the stockholders may be taken without a
meeting if, before or after the action, a written consent thereto
is signed by stockholders holding at least a majority of the voting
power, except that if a different proportion of voting power is
required for such an action at a meeting, then that proportion of
written consents is required.
Under
Wyoming law, an action required or permitted to be taken at a
stockholders’ meeting may be taken without a meeting if the
action is taken by all stockholders entitled to vote on the action.
Wyoming law also allows a corporation’s Articles of
Incorporation to provide that any action required or permitted to
be taken at a stockholders’ meeting may be taken without a
meeting, and without prior notice, if consents in writing setting
the forth the action so taken are signed by the holders of
outstanding shares having not less than the minimum number of votes
that would be required to authorize or take the action at the
meeting at which all shares entitled to vote on the action were
presented and voted.
The
Articles of Incorporation and Bylaws of the Company in Nevada do
not limit the stockholders’ ability to act without a meeting.
The Company’s Wyoming Articles of Incorporation permit the
holders of outstanding shares having not less than the minimum
number of votes that would be required to authorize or take the
action at the meeting at which all shares entitled to vote on the
action were presented and voted to act without a
meeting.
Action by Directors Without a Meeting
Nevada
law permits directors to take unanimous written action without a
meeting in an action otherwise required or permitted to be taken at
a board meeting. Wyoming law permits directors to take written
action without a meeting in an action otherwise required or
permitted to be taken at a board meeting, provided that if such
written consent is taken by less than unanimous written consent of
the directors, the corporation shall give the nonconsenting or
nonvoting directors written notice of the action not more than ten
(10) days after written consents sufficient to take the action have
been delivered to the corporation.
Conflicts of Interest
Nevada
law provides that no contract or transaction between a corporation
and one or more of its directors or officers, or between a
corporation and any other entity of which one or more of its
directors or officers are directors or officers, or in which one or
more of its directors or officers have a financial interest, is
void or voidable if: (i) the director’s or officer’s
interest in the contract or transaction is known to the board of
directors, and the transaction is approved or ratified by the board
of directors in good faith by a vote sufficient for the purpose
(without counting the vote of the interested director or officer);
(ii) the director’s or officer’s interest in the
contract or transaction is known to the stockholders, and the
transaction is approved or ratified by a majority of the
stockholders holding a majority of voting power; (iii) the fact of
the common interest is not known to the director or officer at the
time the transaction is brought before the board of directors; or
(iv) the contract or transaction is fair to the corporation at the
time it is authorized or approved.
Wyoming
law, in general, provides that a transaction with the corporation
in which a director of the corporation has a direct or indirect
interest is not voidable if the transaction was fair at the time it
was entered into. A director is deemed to have an indirect interest
in a transaction if (i) another entity in which the director has a
material interest or in which the director is a general partner is
party to the transaction or (ii) another entity of which the
director is a director, officer, or trustee is a party to the
transaction.
Directors’ Standard of Care and Personal
Liability
Nevada
law provides that a director must discharge his or her duties in
good faith and with a view to the interests of the corporation. In
discharging his or her duties, a director is entitled to rely on
information, opinions, reports, books of account or statements,
including financial statements and other financial data, that are
prepared or presented by: (i) one or more directors, officers, or
employees of the corporation reasonably believed to be reliable and
competent in the matters prepared or presented; (ii) counsel,
public accountants, financial advisers, valuation advisers,
investment bankers, or other persons as to matters reasonably
believed to be within the preparer’s or presenter’s
professional or expert competence; or (iii) a committee on which
the director or officer relying thereon does not serve, as to
matters within the committee’s designated authority and
matters on which the committee is reasonably believed to merit
confidence. A director or officer is not entitled to rely on such
information, opinions, reports, books of account, or statements if
the director or officer has knowledge concerning the matter in
question that would cause reliance thereon to be
unwarranted.
Under
Nevada law, unless the Articles of Incorporation or an amendment
thereto (filed on or after October 1, 2003) provides for greater
individual liability, a director or officer is not individually
liable to the corporation or its stockholders or creditors for any
damages as a result of any act or failure to act in his or her
capacity as a director or officer unless it is proven that: (a) the
director’s or officer’s act or failure to act
constituted a breach of his or her fiduciary duties as a director
or officer; and (b) the breach of those duties involved intentional
misconduct, fraud, or a knowing violation of law.
Under
Wyoming law, a director, when discharging his or her duties, must
act in good faith and in a manner he or she reasonably believes to
be in or at least not opposed to the best interests of the
corporation. The members of the board of directors or a committee
of the board, when becoming informed in connection with their
decision making function or devoting attention to their oversight
function, are required to discharge their duties with the care that
a person in a like position would reasonably believe appropriate
under similar circumstances. In discharging his or her duties, a
director is entitled to rely on: (i) officers or employees of the
corporation whom the director reasonably believes to be reliable
and competent in the functions performed or the information,
opinions, reports, or statements provided; (ii) legal counsel,
public accountants, or other person retained by the corporation as
to matters involving skills or expertise the director reasonably
believes are matters (a) within the person’s professional or
expert competence or (b) as to which the particular person merits
confidence; or (iii) a committee of the board of directors of which
he or she is not a member if the director reasonably believes the
committee merits confidence.
In
general, Wyoming law provides that a director shall not be liable
to the corporation or its stockholders for any decision to take or
not to take action, or any failure to take any action including
abstaining from voting after full disclosure, as a director, unless
the party asserting liability in a proceeding establishes the
following: (i) that certain enumerated defenses to liability were
not asserted, including a provision in the Articles of
Incorporation limiting liability in the manner allowed by Wyoming
law; and (ii) the challenged conduct consisted or was the result of
(a) an action not in good faith, (b) a decision which the director
did not reasonably believe to be in or at least not opposed to the
best interests of the corporation, (c) lack of objectivity or lack
of independence, due to familial, financial, or business
relationships, (d) failure to devote timely attention to the
business and affairs of the corporation, or (e) receipt of an
improper financial benefit.
Limitation or Elimination of Director’s Personal
Liability
Nevada
law provides that directors shall not be personally liable to a
corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director except for liability (i) for any
breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involved intentional misconduct or a knowing violation of law,
(iii) for authorizing a distribution that is unlawful under Nevada
law, or (iv) for any transaction from which the director derived an
improper personal benefit. Such provision protects directors
against personal liability for monetary damages for breaches of
their duty of care.
Wyoming
law provides that directors shall not be personally liable to a
corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director except for liability (i) for receipt
of a financial benefit to which he is not entitled, (ii) for an
intentional infliction of harm on the corporation or its
stockholders, (iii) for participating in unlawful distributions to
stockholders, or (iv) for an intentional violation of criminal law.
Such provision protects directors against personal liability for
monetary damages for breaches of their duty of care.
Indemnification
Under
both Wyoming and Nevada law, a corporation may indemnify any person
who was or is threatened to be made a party to an action, including
an action by or in the right of the corporation, because the person
is or was a director, officer, employee or agent of the corporation
or is or was serving in such capacity in another entity at the
request of the corporation, against expenses, judgments, fines and
amounts paid in settlement, if the person acted in good faith and
in a manner he reasonably believed to be in, or not opposed to, the
best interest of the corporation, and with respect to any criminal
action or proceeding had no reasonable cause to believe his action
was unlawful.
The
Company in Nevada and the Company in Wyoming, in their respective
Articles of Incorporation, indemnify their officers and directors a
manner consistent with applicable statutory law.
Classified Board of Directors
Nevada
law permits a corporation to classify its board of directors if at
least one-fourth of the total number of directors is elected
annually.
Under
Wyoming law, the Articles of Incorporation may provide for
staggering the terms of directors dividing the total number of
directors into two or three groups with each group containing
one-half (1/2) or one-third (1/3) of the total, as near as may be
practicable.
Neither
the Articles of Incorporation of the Company in Nevada nor the
Company in Wyoming provide for a classified or staggered board of
directors.
Cumulative Voting For Directors
Both
Wyoming and Nevada law permit a corporation to specify in its
articles whether cumulative voting exists. Our current Articles of
Incorporation do not provide for cumulative voting and our new
Articles of Incorporation in Wyoming also will not provide for
cumulative voting.
Removal of Directors
Under
Nevada law, a director may be removed by the affirmative vote of
two-thirds of the shares eligible to vote, unless the Articles of
Incorporation provide for a greater number of affirmative votes.
All vacancies, including those caused by increasing the number of
directors, may be filled by a majority vote of the remaining
directors, regardless of whether the remaining directors constitute
a quorum, unless otherwise provided in the Articles of
Incorporation.
In the
case of a corporation whose board is classified, Wyoming law
provides that directors may be removed only for cause unless the
charter documents provide otherwise. If the corporation’s
board is not classified and the charter documents do not provide
otherwise, Wyoming law provides that directors may be removed, with
or without cause, by the holders of a majority of the shares then
entitled to vote at an election of directors.
Vacancies on Board of Directors
Under
both Nevada and Wyoming law, unless the Articles of Incorporation
provide otherwise, if a vacancy occurs on a board of directors,
including a vacancy resulting from an increase in the number of
directors: (i) the stockholders may fill the vacancy; (ii) the
board of directors may fill the vacancy; or (iii) if the directors
remaining in office constitute fewer than a quorum of the board of
directors, they may fill the vacancy by the affirmative vote of a
majority of all the directors remaining in office. If the vacant
office was held by a director elected by a voting group of
stockholders, only the holders of shares of that voting group are
entitled to vote to fill the vacancy if it is filled by the
stockholders. A vacancy that will occur at a specific later date,
by reason of a resignation effective at a later date, may be filled
before the vacancy occurs but the new director may not take office
until the vacancy occurs.
The
Bylaws of both the Company in Nevada and the Company in Wyoming
provide that any vacancy in the board of directors shall be filled
by the affirmative vote of a majority of the remaining directors,
though less than a quorum of the board of directors, or at a
special meeting of the stockholders called for that
purpose.
Annual Meetings of Stockholders
Under
Nevada law, unless directors are elected by written consent, or
unless the Articles of Incorporation or the Bylaws require more
than a plurality of the votes cast, directors of every corporation
must be elected at the annual meeting of the stockholders by a
plurality of the votes cast at the election. Generally, unless
otherwise provided in the Bylaws, the board of directors has the
authority to set the date, time, and place for the annual meeting
of the stockholders. If for any reason directors are not elected by
written consent or at the annual meeting of the stockholders, they
may be elected at any special meeting of the stockholders which is
called and held for that purpose.
Unless
directors are elected by written consent, Wyoming law provides for
annual meetings of stockholders at the time stated in or fixed in
accordance with the Bylaws. The failure to hold an annual meeting
at the time stated in or fixed in accordance with a
corporation’s Bylaws does not affect the validity of any
corporate action.
The
Bylaws of the Company in Nevada and the Company in Wyoming provide
that the regular meeting of the board of directors shall be held
immediately after and at the same place as the annual meeting of
the stockholders or a special meeting of stockholders at which a
director or directors shall have been elected. The board of
directors is also permitted to provide by resolution the time and
place for the holding of additional regular meetings.
Special Meetings of Stockholders
Under
Nevada law, unless otherwise provided in the Articles of
Incorporation or Bylaws, the entire Board, any two directors, or
the president may call special meetings of the stockholders and
directors.
Under
Wyoming law, a corporation shall hold a special meeting of the
stockholders: (i) on call of its board of directors or the person
or persons authorized to do so by the Articles of Incorporation or
Bylaws; or (ii) if the holders of at least ten percent (10%) of all
the votes entitled to be cast on any issue proposed to be
considered at the proposed special meeting sign, date, and deliver
to the corporation one or more written demands for the meeting
describing the purpose or purposes for which it is to be held,
provided that the Articles of Incorporation may fix a lower
percentage or a higher percentage not exceeding twenty-five percent
(25%) of all the votes entitled to be cast on any issue proposed to
be considered.
The
Bylaws of the Company in Nevada provide that special meetings of
the stockholders for any purpose or purpose may be called by the
president, the board of directors, or the holders of ten-percent
(10%) or more of all the shares entitled to vote at such
meeting.
The
Bylaws of the Company provide that special meetings of the
stockholders for any purpose or purpose may be called by the
chairman of the board, the chief executive officer or the
president, or the holders of ten-percent (10%) or more of all the
shares entitled to vote at such meeting.
Place of Meetings
Nevada
law provides meetings of stockholders may be held at such place,
either within or outside the State of Nevada, as the directors may
determine from time to time.
Wyoming
law provides that meetings of stockholders may be held at such
place, either within or outside the State of Wyoming, as may be
provided in the Bylaws of the corporation. In the absence of such
provisions in the Bylaws, all meetings shall be held at the
principal office of the corporation in the State of
Wyoming.
Inspection of Stockholder Lists
Under
Nevada law, any person who has been a stockholder of record of a
corporation for at least six (6) months immediately preceding the
demand, or any person holding, or thereunto authorized in writing
by the holders of, at least five percent (5%) of all of its
outstanding shares, upon at least five (5) days’ written
demand is entitled to inspect in person or by agent or attorney,
during usual business hours, the corporation’s stock ledger
and make copies therefrom.
Under
Wyoming law, a stockholder may inspect a stockholders’ list
two (2) business days after notice of a stockholders meeting is
given for which the list was prepared and continuing through the
meeting, at the corporation’s principal office or at a place
identified in the meeting notice in the city where the meeting will
be held. The corporation shall make the stockholders’ list
available at the meeting, and any stockholder, his agent, or
attorney is entitled to inspect the list at any time during the
meeting or any adjournment.
Amendment of the Articles of Incorporation
Under
Nevada Law, substantive changes to the Articles of Incorporation
require the approval of a simple majority of the outstanding stock
of the corporation entitled to vote. The type of amendments
contemplated in this category include a change of the name of the
corporation, changes to the authorized capital of the corporation
and alterations to or creation of special rights and restrictions
attached to shares of the corporation.
Under
Wyoming law, substantive changes to the Articles of Incorporation
must be approved by the holders of a majority of the shares
entitled to vote unless otherwise provided in the
corporation’s Articles of Incorporation. The types of
amendments contemplated in this category include, but are not
restricted to, a change of the name of the corporation, changes to
the authorized capital of the corporation and alterations to or
creation of special rights and restrictions attached to shares of
the corporation.
Amendment of the Bylaws
Nevada
law provides that, unless otherwise prohibited by any bylaw adopted
by the stockholders, the directors may adopt, amend, or repeal any
bylaw, including any bylaw adopted by the stockholders. The
Articles of Incorporation may grant the authority to adopt, amend,
or repeal Bylaws exclusively to the directors.
Wyoming
law allows a corporation’s board of directors to amend or
repeal the corporation’s Bylaws unless: (i) the Articles of
Incorporation reserves this power exclusively to the stockholders
in whole or part; or (ii) the stockholders in amending, repealing,
or adopting a bylaw provide expressly that the board of directors
may not amend, repeal, or reinstate the bylaw.
The
Bylaws of the Company in Nevada and the Company in Wyoming provide
that the Bylaws of each respective corporation may be altered,
amended, or repealed by a majority of the board of
directors.
Proxies
Under
Nevada law, a proxy is effective only for a period of six months
from the date of its creation, unless it is coupled with an
interest or unless otherwise provided by the stockholder in the
proxy, which duration may not exceed seven years. A proxy shall be
deemed irrevocable if the written authorization states that the
proxy is irrevocable, but is irrevocable only for as long as it is
coupled with an interest sufficient in law to support an
irrevocable power.
Under
Wyoming law, proxy is effective for eleven (11) months unless a
longer period is expressly provided in the appointment form. A
proxy is revocable unless the appointment form or electronic
transmission states that it is irrevocable and the appointment is
coupled with an interest; such irrevocable proxy is revoked when
the interest with which it is coupled is extinguished.
Pre-emptive Rights
Under
Nevada and Wyoming law, stockholders of a corporation do not have a
pre-emptive right to acquire the corporation’s unissued
shares except to the extent the Articles of Incorporation so
provide. The respective Articles of Incorporation of the Company in
Nevada and the Company in Wyoming do not provide for pre-emptive
rights.
Dividends
Both
Nevada and Wyoming law provide that unless the Articles of
Incorporation provide otherwise, shares may be issued pro rata and
without consideration to the corporation’s stockholders or to
the stockholders of one (1) or more classes or series. An issuance
of shares under these provisions is a share dividend. Shares of one
(1) class or series may not be issued as a share dividend in
respect of shares of another class or series unless (i) the
Articles of Incorporation so authorizes; (ii) a majority of the
votes entitled to be cast by the class or series to be issued
approve the issue; or (iii) there are no outstanding shares of the
class or series to be issued. If the board of directors does not
fix the record date for determining stockholders entitled to a
share dividend, it is the date the board of directors authorizes
the share dividend.
Distributions to Stockholders
Under
Nevada law, except as otherwise provided in the Articles of
Incorporation, the board of directors may authorize and the
corporation may make distributions to its stockholders, including
distributions on shares that are partially paid. However, no
distribution may be made if, after giving effect to such
distribution: (a) the corporation would not be able to pay its
debts as they become due in the usual course of business; or (b)
except as otherwise specifically allowed by the Articles of
Incorporation, the corporation’s total assets would be less
than the sum of its total liabilities plus the amount that would be
needed, if the corporation were to be dissolved at the time of
distribution, to satisfy the preferential rights upon dissolution
of stockholders whose preferential rights are superior to those
receiving the distribution. A distribution may be made, among other
ways, by purchase, redemption, or other acquisition of the
corporation’s shares.
Under
Wyoming law, the board of directors may authorize and the
corporation may make distributions to its stockholders, provided
that, no distribution may be made if, after giving it effect: the
corporation would not be able to pay its debts as they become due
in the usual course of business; or the corporation’s total
assets would be less than the sum of its total liabilities plus
(unless the Articles of Incorporation permit otherwise) the amount
that would be needed, if the corporation were to be dissolved at
the time of the distribution, to satisfy the preferential rights
upon dissolution of stockholders whose preferential rights are
superior to those receiving the distribution. A corporation may
make a distribution, among other ways, by: (i) the purchase,
redemption, or other acquisition of the corporation’s shares;
or (ii) the distribution of indebtedness.
The
respective Articles of Incorporation of the Company in Nevada and
the Company in Wyoming do not modify the applicable statutory rules
regarding distributions to stockholders.
Dissolution
Nevada
law provides that a corporation may be voluntarily dissolved upon
the directors’ approval of and recommendation to the
stockholders to dissolve and approval by the stockholders entitled
to vote on such dissolution.
Wyoming
law allows the board of directors to propose dissolution to the
stockholders of the corporation. For the proposal to dissolve to be
adopted: (i) the board of directors shall recommend dissolution to
the stockholders, unless the board of directors determines that
because of conflict of interest or other special circumstances it
should make no recommendation and communicates the basis for its
determination to the stockholders; and (ii) the stockholders
entitled to vote shall approve the proposal to dissolve. Unless the
Articles of Incorporation or the board of directors require a
greater vote or a vote by voting groups, adoption of the proposal
to dissolve shall require the approval of the stockholders at a
meeting at which a quorum consisting of at least a majority of the
votes entitled to be cast exists.
Wyoming
law also provides that a court may dissolve a corporation in an
action by a stockholder where any of the following have occurred:
(i) the directors are deadlocked in the management of the corporate
affairs, the stockholders are unable to break the deadlock, and
irreparable injury to the corporation is threatened or being
suffered, or the business and affairs of the corporation can no
longer be conducted to the advantage of the stockholders generally,
because of the deadlock; (ii) the directors or those in control of
the corporation have acted, are acting, or will act in a manner
that is illegal, oppressive, or fraudulent; (iii) the stockholders
are deadlocked in voting power and have failed, for a period that
includes at least two (2) consecutive annual meeting dates, to
elect successors to directors whose terms have expired; or (iv) the
corporate assets are being misapplied or wasted.
Wyoming
law further provides that a court may dissolve a corporation in a
proceeding brought by the attorney general if it establishes that
the corporation obtained its Articles of Incorporation through
fraud or the corporation has continued to exceed or abuse the
authority conferred upon it by law.
Nevada
law does not have a comparable statute with respect to judicial
dissolutions.
Anti-Take Over Provisions
Nevada
law prohibits a “resident domestic corporations” (i.e.
a domestic corporation that has more than 200 stockholders of
record) from engaging in a “combination” with an
“interested stockholder” for two (2) years following
the date that such person becomes an interested stockholder and
places certain restrictions on such combinations even after the
expiration of the two-year period. With certain exceptions, an
interested stockholder is a person or group that owns ten-percent
(10%) or more of the corporation’s outstanding voting power
(including stock with respect to which the person has voting rights
and any rights to acquire stock pursuant to an option, warrant,
agreement, arrangement, or understanding or upon the exercise of
conversion or exchange rights) or is an affiliate or associate of
the corporation and was the owner of ten-percent (10%) or more of
such voting stock at any time within the previous two years. A
Nevada corporation may elect not to be governed by this provision
in its Articles of Incorporation. the Company has not opted out of
this provision in its Articles of Incorporation.
Wyoming
law prohibits a “qualified corporation” from engaging
in a “combination” with an “interested
stockholder” for three (3) years following the date that such
person becomes an interested stockholder and places certain
restrictions on such combinations even after the expiration of the
three-year period. A “qualified corporation” is large
publicly traded corporation (i.e. more than $10 million in assets),
incorporated in Wyoming and which has “substantial business
operations” in Wyoming (as set forth in the Wyoming Statutes)
With certain exceptions, an interested stockholder is a person or
group that owns fifteen-percent (15%) or more of the
corporation’s outstanding voting power (including stock with
respect to which the person has voting rights and any rights to
acquire stock pursuant to an option, warrant, agreement,
arrangement, or understanding or upon the exercise of conversion or
exchange rights) or is an affiliate or associate of the corporation
and was the owner of fifteen-percent (15%) or more of such voting
stock at any time within the previous two years. A Wyoming
corporation may elect not to be governed by this provision by
either a specific provision in in its Articles of Incorporation or
a statement in its Bylaws that it elects not to be subject to these
restrictions. the Company’s Bylaws include a statement that
it elects not to be subject to these restrictions.
Nevada
law contains provisions relating to “issuing
corporations” (an entity with more than 200 record
stockholders and 100 of such record stockholders are Nevada
residents) that provide that an acquiring person shall only obtain
voting rights in the “control shares” purchased by such
person to the extent approved by the other stockholders at a
meeting. Wyoming has similar provisions for “qualified
corporations.” With certain exceptions, an acquiring person
is one who acquires or offers to acquire a “controlling
interest” in the corporation, defined as one-fifth or more of
the voting power. Control shares include not only shares acquired
or offered to be acquired in connection with the acquisition of a
controlling interest, but also all shares acquired by the acquiring
person within the preceding 90 days. The Nevada and Wyoming
statutes cover not only the acquiring person but also any persons
acting in association with the acquiring person. Nevada and Wyoming
permit a corporation to elect not to be governed by these
provisions in the same manner set forth above. the Company in
Nevada and the Company in Wyoming have opted out of this provision
in its respective Articles of Incorporation. the Company’s
Bylaws include a statement that it elects not to be subject to
these restrictions.
Federal Income Tax Consequences of the Domicile Change
The
Domicile Change as a Wyoming corporation is intended to be tax free
under the Internal Revenue Code. Accordingly, you will recognize no
gain or loss for federal income tax purposes as a result of the
completion of the Domicile Change. You will have a tax basis in
your shares of capital stock of the Company in Nevada equal to your
tax basis in your shares of capital stock of the Company in
Wyoming. Provided that you have held your shares of capital stock
of the Company in Nevada as a capital asset, your holding period
for the shares of capital stock of the Company in Wyoming will
include the holding period of your shares of capital stock of the
Company. Neither we nor the Company will recognize any gain or loss
for federal income tax purposes as a result of the Domicile Change,
and the Company will succeed, without adjustment, to our tax
attributes.
ACTION: TO INCREASE THE NUMBER OF AUTHORIZED NUMBER OF COMMON
SHARES FROM 1,500,000,000 TO UNLIMITED (THE “SHARE
INCREASE”)
On July
2, 2018, our Board of Directors approved, subject to receiving the
approval of the holder of a majority of our outstanding voting
stock, an amendment of our Articles of Incorporation (the
“Amendment”), to increase the number of authorized
shares of common stock we may issue from 1,500,000,000 to unlimited
(the “Share Increase”) once the Domicile Change is
completed. The Majority Stockholder approved the Restated Articles
pursuant to a written consent dated as of July 2, 2018. The
Restated Articles effecting the share increase will become
effective following filing with the Secretary of State of the State
of Wyoming, which will occur promptly following the 20th day after
the filing of the Definitive Information Statement.
We are
currently authorized by our Certificate of Incorporation to issue
1,500,000,000 shares of common stock, $0.001 par value per share
and 10,000,000 shares of preferred stock, $0.001 par value per
share. Pursuant to the Amendment we will increase the number of
common shares we are authorized to issue to unlimited shares of
common stock, $0.001 par value per share. As of the date the
Amendment was approved by our Board and the Majority Stockholder,
there were 1,472,153,053.000 shares of our common stock issued and
outstanding.
Reasons for the Share Increase
Our
Board believes it is in our best interests and the best interests
of our stockholders to increase the number of authorized shares of
our common stock to allow for the issuance of shares of our common
stock or other securities in connection with such potential
issuances and such other purposes as the Board determines. The
Board believes that the Share Increase will afford the Company
greater flexibility in seeking capital and potential acquisition
targets. The Board has no immediate plans, understandings,
agreement or commitments to issue shares of Common Stock for any
purposes.
Effect of the Share Increase
The
increase in the authorized number of shares of our common stock
will permit our Board to issue additional shares of our common
stock without further approval of our stockholders, and our Board
does not intend to seek stockholder approval prior to any issuance
of the authorized capital stock unless stockholder approval is
required by applicable law or stock market or exchange
requirements. Our issuance of additional shares of common stock may
result in substantial dilution to our existing stockholders, and
such issuances may not require stockholder approval.
We
presently do not have in place provisions which may have an
anti-takeover effect. The increase in the authorized number of
shares of our common stock did not result from our knowledge of any
specific effort to accumulate our securities or to obtain control
of us by means of a merger, tender offer, proxy solicitation in
opposition to management or otherwise, and we did not take such
action to increase the authorized shares of our common stock to
enable us to frustrate any efforts by another party to acquire a
controlling interest or to seek representation on our
Board.
The
issuance of additional shares of our common stock may have a
dilutive effect on earnings per share and on the equity and voting
power of existing security holders of our common stock. It may also
adversely affect the market price of our common stock. However, if
additional shares are issued in transactions whereby favorable
business opportunities are provided, the market price of our common
stock may increase.
The
holders of our common stock are entitled to one vote for each share
held of record on all matters to be voted on by our
stockholders.
The
holders of our common stock are entitled to receive ratably such
dividends, if any, as may be declared by the Board out of funds
legally available. We have not paid any dividends since our
inception, and we presently anticipate that all earnings, if any,
will be retained for development of our business. Any future
disposition of dividends will be at the discretion of our Board and
will depend upon, among other things, our future earnings,
operating and financial condition, capital requirements, and other
factors.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The
following information table sets forth certain information
regarding the Common Stock owned on July 17, 2018 by (i) each
person who is known by the Company to own beneficially more than 5%
of its outstanding Common Stock, (ii) each director and
officer.
|
Names and Address (1)
|
Number of Shares Owned
|
Percentage (2)
|
|
James Robert
Todhunter (3) (4)
701
North Green Valley Parkway, Suite 200
Henderson,
Nevada 89012
|
235,750,000
(4)
|
16%
|
|
Gregorio Formoso
(7)
701
North Green Valley Parkway, Suite 200
Henderson,
Nevada 89012
|
100,000,000
|
.006%
|
|
Dr.
Carlos Arias Eguiguren (8)
701
North Green Valley Parkway, Suite 200
Henderson,
Nevada 89012
|
19,444,444
|
.001%
|
1.
The person named in
this table has sole voting and investment power with respect to all
shares of common stock reflected as beneficially
owned.
2.
Based on
1,500,000,000.000 shares of common stock outstanding as of July 17,
2018.
3.
James Robert
Todhunter is our President, Chief Executive Officer and a
Director.
4.
Shares are
beneficially owned through Percana Mining Corp., a company in which
he is a director, owner and has voting control.
5.
Guil Rivera is not
a Director.
6.
Gregorio Formoso is
our Secretary and a Director
7.
Dr.
Carlos Arias Eguiguren is a Director.
ADDITIONAL INFORMATION
The
Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and in accordance therewith files reports, proxy
statements and other information including annual and quarterly
reports on Form 10-K and 10-Q (the “1934 Act Filings”)
with the Securities and Exchange Commission (the
“Commission”). Reports and other information filed by
the Company can be inspected and copied at the public reference
facilities maintained at the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, DC 20549. Copies of such material
can be obtained upon written request addressed to the Commission,
Public Reference Section, 450 Fifth Street, N.W., Washington,
D.C. 20549, at prescribed rates. The Commission maintains a
web site on the Internet (http://www.sec.gov) that contains
reports, proxy and information statements and other information
regarding issuers that file electronically with the Commission
through the Electronic Data Gathering, Analysis and Retrieval
System (“EDGAR”).
NO DISSENTER’S RIGHTS
The
Stockholders have no right under the Nevada Revised Statutes, the
Articles consistent with above or by-laws to dissent from any of
the provisions adopted in the Actions.
CONCLUSION
As a
matter of regulatory compliance, we are providing this information
which describes the purpose and effect of the above
actions. Your consent to the above action is not
required and is not being solicited in connection with this
action. This information is intended to provide our
stockholders information required by the rules and regulations of
the Securities Exchange Act of 1934.