U. S. Securities and Exchange Commission
Washington, D. C. 20549
FORM 10-KSB
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended December 31, 2001
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________________ to __________________
Commission File No. 000-24379
Atlantica, Inc.
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(Name of Small Business Issuer in its Charter)
UTAH 43-0976463
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(State or Other Jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
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Issuer's Telephone Number: (801) 278-9424
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act:
Check whether the Registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [ ]
State Registrant's revenues for its most recent fiscal year: December 31, 2001 - None.
State the aggregate market value of the common voting stock of the Registrant held by non-affiliates computed by reference to the price at which the stock was sold, or the average bid and asked prices of such stock, as of a specified date within the past 60 days.
April 6, 2005 - $67.28. There are approximately 672,775 shares of common voting stock of the Registrant held by non-affiliates. During the past several years, there has been no "public market" for shares of common stock of the Registrant, so the Registrant has arbitrarily valued these shares on the basis of par value per share.
(ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PAST FIVE YEARS)
None; not applicable.
Check whether the Registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes No
None; not applicable.
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
State the number of shares outstanding of each of the Registrant's
classes of common equity, as of the latest practicable date: April 6, 2005
- 24,581,458 shares of common stock.
A description of "Documents Incorporated by Reference" is contained in
Part III, Item 13.
Transitional Small Business Issuer Format Yes X No
PART I
Item 1. Description of Business.
Business Development
Organization
Atlantica, Inc. (our "Company," "we," "us," "our" and words of similar import) was organized pursuant to the laws of the State of Utah on March 3, 1938, under the name "Red Hills Mining Company," with an authorized capital of $20,000 divided into 2,000,000 shares of common stock of a par value of $0.01 per share. Our Company was formed for the primary purpose of conducting the business of mining in all of its branches.
On February 5, 1953, we changed our name to "Allied Oil and Minerals Company," with our primary purpose continuing to be mining.
On January 8, 1971, we changed our name to "Community Equities Corporation," we increased our authorized capital from $20,000 to $150,000, comprised of 15,000,000 at $.01 and our purpose also changed to the business of real estate development. We discontinued the real estate development in 1990.
Effective March 26, 1996, the corporate charter was reinstated, and we changed our corporate name to "Atlantica, Inc."
On March 13, 1998, we increased our authorized capital from 15,000,000 shares of $.01 par value to 25,000,000 shares of $0.0001 par value common stock; and we authorized a reverse split of one share for every 20 shares. We also authorized the issuance of 24,000,000 shares to Gregory Aurre, President and a director, for services rendered and expenses paid. The Board also issued 25,000 shares each to Amerika Aurre, Vice President and a director and Gregory Aurre III, Secretary and a director, for services rendered. We also adopted new Bylaws for us.
The Board of Directors resolved on October 30, 2002, to appoint new officers and directors since Gregory Aurre II, Gregory Aurre III and Amerika Aurre all resigned, in seriatim, from any and all capacity as officers and directors. Thomas J. Howells was appointed as President and director, Terry Jenson as Vice President and director and Travis T. Jenson as Secretary and director.
On November 12, 2002, the 23,908,000 shares held by Gregory Aurre II, was foreclosed on to satisfy debt in the amount of $80,000, owed to Duane S. Jenson. Mr. Jenson had personally loaned Mr. Aurre the $80,000 which was secured solely by Mr. Aurre's shares of Atlantica. Subsequent to foreclosing on the shares of Mr. Aurre's that were held by Mr. Jenson as security for the loan, Mr. Jenson elected to gift a portion of those shares to his son, Travis T. Jenson, as well as to a business associate, Thomas J. Howells, and a long-time friend and legal counsel, Leonard W. Burningham, Esq. See Part II, Item 11.
On November 15, 2002, we were reinstated with the State of Utah.
Copy of our Bylaws are attached hereto and are incorporated herein by reference. See Part III, Item 13.
Copies of our Articles of Incorporation, as amended, were attached to our initial Registration Statement on Form 10-SB and are incorporated herein by reference. See Part III, Item 13.
Business
Our Company's plan of operation for the next 12 months is to:(i) consider guidelines of industries in which we may have an interest; (ii) adopt a business plan regarding engaging in the business of any selected industry; and (iii) to commence such operations through funding and/or the acquisition of a "going concern" engaged in any industry selected.
Our Company is not currently engaged in any substantive business activity, and we have no plans to engage in any such activity in the foreseeable future. In our present form, we may be deemed to be a vehicle to acquire or merge with a business or company. Regardless, the commencement of any business opportunity will be preceded by the consideration and adoption of a business plan by our Board of Directors. We do not intend to restrict our search for business opportunities to any particular business or industry, and the areas in which we will seek out business opportunities or acquisitions, reorganizations or mergers may include, but will not be limited to, the fields of high technology, manufacturing, natural resources, service, research and development, communications, transportation, insurance, brokerage, finance and all medically related fields, among others. We recognize that the number of suitable potential business ventures that may be available to us may be extremely limited, and may be restricted to entities who desire to avoid what such entities may deem to be the adverse factors related to an initial public offering ("IPO"). The most prevalent of these factors include substantial time requirements, legal and accounting costs, the inability to obtain an underwriter who is willing to publicly offer and sell shares, the lack of or the inability to obtain the required financial statements for such an undertaking, limitations on the amount of dilution to public investors in comparison to the stockholders of any such entities, along with other conditions or requirements imposed by various federal and state securities laws, rules and regulations and federal and state agencies that implement such laws, rules and regulations. Any of these types of transactions, regardless of the particular prospect, would require us to issue a substantial number of shares of our common stock, that could amount to as much as 95% of our outstanding securities following the completion of any such transaction; accordingly, investments in any such private enterprise, if available, would be much more favorable than any investment in our Company.
Management intends to consider a number of factors prior to making any decision as to whether to participate in any specific business endeavor, none of which may be determinative or provide any assurance of success. These may include, but will not be limited to, as applicable, an analysis of the quality of the particular entity's management personnel; the anticipated acceptability of any new products or marketing concepts that it may have; the merit of its technological changes; its present financial condition, projected growth potential and available technical, financial and managerial resources; its working capital, history of operations and future prospects; the nature of its present and expected competition; the quality and experience of its management services and the depth of its management; its potential for further research, development or exploration; risk factors specifically related to its business operations; its potential for growth, expansion and profit; the perceived public recognition or acceptance of its products, services, trademarks and name identification; and numerous other factors which are difficult, if not impossible, to properly or accurately analyze, let alone describe or identify, without referring to specific objective criteria.
Regardless, the results of operations of any specific entity may not necessarily be indicative of what may occur in the future, by reason of changing market strategies, plant or product expansion, changes in product emphasis, future management personnel and changes in innumerable other factors. Further, in the case of a new business venture or one that is in a research and development mode, the risks will be substantial, and there will be no objective criteria to examine the effectiveness or the abilities of its management or its business objectives. Also, a firm market for its products or services may yet need to be established, and with no past track record, the profitability of any such entity will be unproven and cannot be predicted with any certainty.
Management will attempt to meet personally with management and key personnel of the entity providing any potential business opportunity afforded to our Company, visit and inspect material facilities, obtain independent analysis or verification of information provided and gathered, check references of management and key personnel and conduct other reasonably prudent measures calculated to ensure a reasonably thorough review of any particular business opportunity; however, due to time constraints of management, these activities may be limited. See the heading "Business Experience," Part III, Item 9.
We are unable to predict the time as to when and if we may actually participate in any specific business endeavor. Our Company anticipates that proposed business ventures will be made available to us through personal contacts of directors, executive officers and principal stockholders, professional advisors, broker dealers in securities, venture capital personnel, members of the financial community and others who may present unsolicited proposals. In certain cases, we may agree to pay a finder's fee or to otherwise compensate the persons who submit a potential business endeavor in which our Company eventually participates. Such persons may include our directors, executive officers and beneficial owners our securities or their affiliates. In this event, such fees may become a factor in negotiations regarding any potential venture and, accordingly, may present a conflict of interest for such individuals. Management does not presently intend to acquire or merge with any business enterprise in which any member has a prior ownership interest.
Our Company's directors and executive officers have not used any particular consultants, advisors or finders on a regular basis.
Although we currently have no plans to do so, depending on the nature and extent of services rendered, we may compensate members of management in the future for services that they may perform for our Company. Because we currently have extremely limited resources, and we are unlikely to have any significant resources until we have determined a business or enterprise to engage in or have completed a merger or acquisition, management expects that any such compensation would take the form of an issuance of our Company's common stock to these persons; this would have the effect of further diluting the holdings of our other stockholders. There are presently no preliminary agreements or understandings between us and members of management respecting such compensation.
Substantial fees are often paid in connection with the completion of all types of acquisitions, reorganizations or mergers, ranging from a small amount to as much as $400,000. These fees are usually divided among promoters or founders, after deduction of legal, accounting and other related expenses, and it is not unusual for a portion of these fees to be paid to members of management or to principal stockholders as consideration for their agreement to retire a portion of the shares of common stock owned by them. Management may actively negotiate or otherwise consent to the purchase of all or any portion of their common stock as a condition to, or in connection with, a proposed reorganization, merger or acquisition. It is not anticipated that any such opportunity will be afforded to other stockholders or that such other stockholders will be afforded the opportunity to approve or consent to any particular stock buy-out transaction. In the event that any such fees are paid, they may become a factor in negotiations regarding any potential acquisition or merger by our Company and, accordingly, may also present a conflict of interest for such individuals. We have no present arrangements or understandings respecting any of these types of fees or opportunities.
None of our directors, executive officers, founders or their affiliates or associates has had any negotiations with any representatives of the owners of any business or company regarding the possibility of an acquisition, reorganization, merger or other business opportunity for our Company; nor are there any similar arrangements with us.
Risk Factors
In any business venture, there are substantial risks specific to the particular enterprise which cannot be ascertained until a potential acquisition, reorganization or merger candidate has been identified; however, at a minimum, our Company's present and proposed business operations will be highly speculative and be subject to the same types of risks inherent in any new or unproven venture, and will include those types of risk factors outlined below.
Extremely Limited Assets; No Source of Revenue.
Our Company has no assets and has had no profitable operations since inception. We will not receive additional revenues until we select an industry in which to commence business or complete an acquisition, reorganization or merger, at the earliest. We can provide no assurance that any selected or acquired business will produce any material revenues for our Company or our stockholders or that any such business will operate on a profitable basis.
Our Company May Be Deemed to Be a "Blank Check" Company Until We Adopt a Business Plan.
The limited business operations of our Company, as now contemplated, involve those of a "blank check" company. The only activities to be conducted by our Company are winding down the business and to manage our current limited assets and to seek out and investigate the commencement or the acquisition of any viable business opportunity by purchase and exchange for securities of our Company or pursuant to a reorganization or merger through which securities of our Company will be issued or exchanged.
Discretionary Use of Proceeds; "Blank Check" Company.
Because our Company is not currently engaged in any substantive business activities, as well as management's broad discretion with respect to selecting a business or industry for commencement of operations or completing an acquisition of assets, property or business, our Company may be deemed to be a "blank check" company. Although management intends to apply any proceeds we may receive through the issuance of stock or debt to a suitable business enterprise, subject to the criteria identified above, such proceeds will not otherwise be designated for any more specific purpose. Our Company can provide no assurance that any use or allocation of such proceeds will allow us to achieve our business objectives.
Our Company Will Seek Out Business Opportunities.
Management will seek out and investigate business opportunities through every reasonably available fashion, including personal contacts, professionals, securities broker dealers, venture capital personnel, members of the financial community and others who may present unsolicited proposals; our Company may also advertise our availability as a vehicle to bring a company to the public market through a "reverse" reorganization or merger.
Absence of Substantive Disclosure Relating to Prospective Acquisitions.
Because our Company has not yet identified any industry or assets, property or business that we may engage in or acquire, potential investors in our Company will have virtually no substantive information upon which to base a decision whether to invest in our Company. Potential investors would have access to significantly more information if our Company had already identified a potential acquisition or if the acquisition target had made an offering of its securities directly to the public. Our Company can provide no assurance that any investment in our Company will not ultimately prove to be less favorable than such a direct investment.
Unspecified Industry and Acquired Business; Unascertainable Risks.
To date, our Company has not identified any particular industry or business in which to concentrate our potential interests. Accordingly, prospective investors currently have no basis to evaluate the comparative risks and merits of investing in the industry or business in which our Company may acquire. To the extent that our Company may acquire a business in a high risk industry, our Company will become subject to those risks. Similarly, if our Company acquires a financially unstable business or a business that is in the early stages of development, our Company will become subject to the numerous risks to which such businesses are subject. Although management intends to consider the risks inherent in any industry and business in which we may become involved, there can be no assurance that we will correctly assess such risks.
Uncertain Structure of Acquisition.
Management has had no preliminary contact or discussions regarding, and there are no present plans, proposals or arrangements to engage in or acquire any specific business, assets, property or business. Accordingly, it is unclear whether such an acquisition would take the form of an exchange of capital stock, a merger or an asset acquisition. However, because our Company has virtually no resources as of the date of this Annual Report, management expects that any such acquisition would take the form of an exchange of capital stock.
Auditor's 'Going Concern' Opinion.
The Independent Auditor's Report issued in connection with the audited financial statements of our Company for the calendar years ended December 31, 2004, 2003, 2002 and 2001, expresses "substantial doubt about its ability to continue as a going concern," due to our Company's status as a start up and our lack of profitable operations. See Part II, Item 7, of this Annual Report.
Losses Associated With Startup.
Our Company has not had a profitable operating history. We cannot guarantee that we will become profitable.
State Restrictions on "Blank Check" Companies.
A total of 36 states prohibit or substantially restrict the registration and sale of "blank check" companies within their borders. Additionally, 36 states use "merit review powers" to exclude securities offerings from their borders in an effort to screen out offerings of highly dubious quality. See paragraph 8221, NASAA Reports, CCH Topical Law Reports, 1990. Our Company intends to comply fully with all state securities laws, and plans to take the steps necessary to ensure that any future offering of our securities is limited to those states in which such offerings are allowed. However, while our Company has no substantive business operations and is deemed to a "blank check" Company, these legal restrictions may have a material adverse impact on the Company's ability to raise capital because potential purchasers of the Company's securities must be residents of states that permit the purchase of such securities. These restrictions may also limit or prohibit stockholders from reselling shares of our Company's common stock within the borders of regulating states.
By regulation or policy statement, eight states (Idaho, Maryland, Missouri, Nevada, New Mexico, Pennsylvania, Utah and Washington), some of which are included in the group of 36 states mentioned above, place various restrictions on the sale or resale of equity securities of "blank check" or "blind pool" companies. These restrictions include, but are not limited to, heightened disclosure requirements, exclusion from "manual listing" registration exemptions for secondary trading privileges and outright prohibition of public offerings of such companies. Because our Company does not intend to make any offering of our securities in the foreseeable future, management does not believe that any state restriction on "blank check" offerings will have any effect on our Company.
In most jurisdictions, "blank check" and "blind pool" companies are not eligible for participation in the Small Corporate Offering Registration ("SCOR") program, which permits an issuer to notify the Securities and Exchange Commission of certain offerings registered in such states by filing a Form D under Regulation D of the Securities and Exchange Commission. All states (with the exception of Alabama, Delaware, Florida, Hawaii, Minnesota, Nebraska and New York) have adopted some form of SCOR. States participating in the SCOR program also allow applications for registration of securities by qualification by filing a Form U-7 with the states' securities commissions. Nevertheless, our Company does not anticipate making any SCOR offering or other public offering in the foreseeable future, even in any jurisdiction where it may be eligible for participation in SCOR, despite our status as a "blank check" or "blind pool" company.
The net effect of the above-referenced laws, rules and regulations will be to place significant restrictions on our Company's ability to register, offer and sell and/or to develop a secondary market for shares of our Company's common stock in virtually every jurisdiction in the United States. These restrictions should cease once and if our Company acquires a venture by purchase, reorganization or merger, so long as the business operations succeeded to involve sufficient activities of a specific nature.
Management to Devote Insignificant Time to Activities of Our Company.
Members of our Company's management are not required to devote their full time to the affairs of our Company. Because of their time commitments, as well as the fact that our Company has no business operations, the members of management currently devote one hour a week to the activities of our Company, until such time as our Company has identified a suitable acquisition target.
No Market for Common Stock; No Market for Shares.
Although our Company intends to submit for quotation of our common stock on the OTC Bulletin Board of the NASD before any selection of a business opportunity or a merger or acquisition transaction, and to seek a broker-dealer to act as market-maker for our securities (without the use of any consultant), there is currently no market for such shares, there have been no discussions with any broker-dealer or any other person in this regard, and no market maker has been identified; there can be no assurance that such a market will ever develop or be maintained. Any market price for shares of common stock of our Company is likely to be very volatile, and numerous factors beyond the control of our Company may have a significant effect. In addition, the stock markets generally have experienced, and continue to experience, extreme price and volume fluctuations which have affected the market price of many small capital companies and which have often been unrelated to the operating performance of these companies. These broad market fluctuations, as well as general economic and political conditions, may adversely affect the market price of our Company's common stock in any market that may develop. Sales of "restricted securities" under Rule 144 may also have an adverse effect on any market that may develop. See Part II, Item 5.
Risks of "Penny Stock."
Our Company's common stock may be deemed to be "penny stock" as that term is
defined in Rule 3a51-1 of the Securities and Exchange Commission. Penny
stocks are stocks (i) with a price of less than five dollars per share;
(ii) that are not traded on a "recognized" national exchange; (iii) whose
prices are not quoted on the NASDAQ automated quotation system (NASDAQ- listed
stocks must still meet requirement (i) above); or (iv) in issuers with net
tangible assets less than $2,000,000 (if the issuer has been in continuous
operation for at least three years) or $5,000,000 (if in continuous operation
for less than three years), or with average revenues of less than $6,000,000
for the last three years.
Section 15(g) of the Exchange Act and Rule 15g-2 of the Securities and Exchange Commission require broker- dealers dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document before effecting any transaction in a penny stock for the investor's account. Potential investors in our Company's common stock are urged to obtain and read such disclosure carefully before purchasing any shares that are deemed to be "penny stock."
Moreover, Rule 15g-9 of the Securities and Exchange Commission requires broker-dealers in penny stocks to approve the account of any investor for transactions in such stocks before selling any penny stock to that investor. This procedure requires the broker-dealer to (i) obtain from the investor information concerning his or her financial situation, investment experience and investment objectives; (ii) reasonably determine, based on that information, that transactions in penny stocks are suitable for the investor and that the investor has sufficient knowledge and experience as to be reasonably capable of evaluating the risks of penny stock transactions; (iii) provide the investor with a written statement setting forth the basis on which the broker-dealer made the determination in (ii) above; and (iv) receive a signed and dated copy of such statement from the investor, confirming that it accurately reflects the investor's financial situation, investment experience and investment objectives. Compliance with these requirements may make it more difficult for investors in our Company's common stock to resell their shares to third parties or to otherwise dispose of them.
There Has Been No "Established Public Market" for Our Company's Common Stock Since 1974.
At such time as our Company identifies a business opportunity or completes a merger or acquisition transaction, if at all, we may attempt to qualify for quotation on either NASDAQ or a national securities exchange. However, at least initially, any trading in our common stock will most likely be conducted in the over-the-counter market in the "pink sheets" or the OTC Bulletin Board of the NASD. Management intends to submit our securities for quotations on a national medium as soon as is reasonably practicable.
Principal Products or Services and Their Markets
None; not applicable.
Distribution Methods of the Products or Services
None; not applicable.
Status of any Publicly Announced New Product or Service
None; not applicable.
Competitive Business Conditions
Management believes that there are literally thousands of "blank check" companies engaged in endeavors similar to those engaged in by our Company; many of these companies have substantial current assets and cash reserves. Competitors also include thousands of other publicly-held companies whose business operations have proven unsuccessful, and whose only viable business opportunity is that of providing a publicly-held vehicle through which a private entity may have access to the public capital markets. There is no reasonable way to predict the competitive position of our Company or any other entity in the strata of these endeavors; however, our Company, having limited assets and cash reserves, will no doubt be at a competitive disadvantage in competing with entities which have recently completed IPO's, have significant cash resources and have recent operating histories when compared with the complete lack of any substantive operations by our Company for the past several years.
Sources and Availability of Raw Materials and Names of Principal Suppliers
None; not applicable.
Dependence on One or a Few Major Customers
None; not applicable.
Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements or Labor Contracts
None; not applicable.
Need for any Governmental Approval of Principal Products or Services
Because our Company currently produces no products or services, we are not presently subject to any governmental regulation in this regard. However, in the event that our Company engages in a merger or acquisition transaction with an entity that engages in such activities, we will become subject to all governmental approval requirements to which the merged or acquired entity is subject.
Effect of Existing or Probable Governmental Regulations on Business
The integrated disclosure system for small business issuers adopted by the Securities and Exchange Commission in Release No. 34-30968 and effective as of August 13, 1992, substantially modified the information and financial requirements of a "Small Business Issuer," defined to be an issuer that has revenues of less than $25 million; is a U.S. or Canadian issuer; is not an investment company; and if a majority-owned subsidiary, the parent is also a small business issuer; provided, however, an entity is not a small business issuer if it has a public float (the aggregate market value of the issuer's outstanding securities held by non- affiliates) of $25 million or more.
The Securities and Exchange Commission, state securities commissions and the North American Securities Administrators Association, Inc. ("NASAA") have expressed an interest in adopting policies that will streamline the registration process and make it easier for a small business issuer to have access to the public capital markets. The present laws, rules and regulations designed to promote availability to the small business issuer of these capital markets and similar laws, rules and regulations that may be adopted in the future will substantially limit the demand for "blank check" companies like our Company, and may make the use of these companies obsolete.
We are also subject to the Sarbanes-Oxley Act of 2002. This Act creates a strong and independent accounting oversight board to oversee the conduct of auditors of public companies and strengthens auditor independence. It also requires steps to enhance the direct responsibility of senior members of management for financial reporting and for the quality of financial disclosures made by public companies; establishes clear statutory rules to limit, and to expose to public view, possible conflicts of interest affecting securities analysts; creates guidelines for audit committee members' appointment, compensation and oversight of the work of public companies' auditors; prohibits certain insider trading during pension bund blackout periods; and establishes a federal crime of securities fraud, among other provisions.
Section 14(a) of the Exchange Act requires all companies with securities registered pursuant to Section 12(g) of the Exchange Act to comply with the rules and regulations of the Securities and Exchange Commission regarding proxy solicitations, as outlined in Regulation 14A. Matters submitted to stockholders of our Company at a special or annual meeting thereof or pursuant to a written consent will require our Company to provide our stockholders with the information outlined in Schedules 14A or 14C of Regulation 14; preliminary copies of this information must be submitted to the Securities and Exchange Commission at least 10 days prior to the date that definitive copies of this information are forwarded to our stockholders.
We are also required to file annual reports on Form 10-KSB and quarterly reports on Form 10-QSB with the Securities Exchange Commission on a regular basis, and will be required to timely disclose certain material events (e.g., changes in corporate control; acquisitions or dispositions of a significant amount of assets other than in the ordinary course of business; and bankruptcy) in a Current Report on Form 8-K12G3.
If we are acquired by a non-"reporting issuer" under the Exchange Act, we will be subject to the "back-door registration" requirements of the Securities and Exchange Commission that will require us to file a Current Report on Form 8-K12G3 that will include all information about such non-"reporting issuer" as would have been required to be filed by that entity had it filed a Form 10 or Form 10SB Registration Statement with the Securities and Exchange Commission. The Securities and Exchange Commission proposed on April 13, 2004, that any acquisition that will result in our Company no longer being a "blank check" or "blind pool" company will require us to include all information about the acquired company as would have been required to be filed by that entity had it filed a Form 10 or Form 10SB Registration Statement with the Securities and Exchange Commission.
Research and Development
None; not applicable.
Cost and Effects of Compliance with Environmental Laws
None; not applicable. However, environmental laws, rules and regulations may have an adverse effect on any business venture viewed by our Company as an attractive acquisition, reorganization or merger candidate, and these factors may further limit the number of potential candidates available to our Company for acquisition, reorganization or merger.
Number of Employees
None.
Our Company has no assets, property or business; its principal executive office address and telephone number are the office address and telephone number of Thomas J. Howells, who is a shareholder, our President and a director, and are provided at no cost.
Our Company is not the subject of any pending legal proceedings; and to the knowledge of management, no proceedings are presently contemplated against our Company by any federal, state or local governmental agency.
Further, to the knowledge of management, no director or executive officer is party to any action in which any has an interest adverse to our Company.
No matter was submitted to a vote of our Company's security holders during the fourth quarter of the period covered by this Annual Report or during the previous two fiscal years.
PART II
There has never been any "established trading market" for shares of common stock of our Company. However, we intend to submit for quotations of our common stock on the OTC Bulletin Board of the National Association of Securities Dealers ("NASD"). No assurance can be given that any market for our common stock will develop or be maintained. For any market that develops for our common stock, the sale of "restricted securities" (common stock) pursuant to Rule 144 of the Securities and Exchange Commission by members of management or any other person to whom any such securities may be issued in the future may have a substantial adverse impact on any such public market. Present members of management have already satisfied the one year holding period of Rule 144 for public sales of their respective holdings in our Company in accordance with Rule 144. See the caption "Recent Sales of Unregistered Securities," of this Item, below.
A minimum holding period of one year is required for resales under Rule 144, along with other pertinent provisions, including publicly available information concerning our Company; limitations on the volume of restricted securities which can be sold in any ninety (90) day period; the requirement of unsolicited broker's transactions; and the filing of a Notice of Sale on Form 144.
Holders
The number of record holders of our Company's securities as of April 6, 2005 is approximately 664.
Dividends
Our Company has not declared any cash dividends with respect to our common stock, and does not intend to declare dividends in the foreseeable future. The future dividend policy of our Company cannot be ascertained with any certainty, and if and until our Company completes any acquisition, reorganization or merger, no such policy will be formulated. There are no material restrictions limiting, or that are likely to limit, our Company's ability to pay dividends on our securities.
Equity Compensation Plan Information
Our Company does not have any Equity Compensation Plans.
Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities.
We have had no recent sales of restricted securities.
Generally, "restricted securities" can be resold under Rule 144 once they have been held for at least one year (subparagraph (d) thereof), provided that the issuer of the securities satisfies the "current public information" requirements (subparagraph (c)) of the Rule; no more than 1% of the outstanding securities of the issuer are sold in any three month period (subparagraph (e)); the seller does not arrange or solicit the solicitation of buyers for the securities in anticipation of or in connection with the sale transactions or does not make any payment to anyone in connection with the sales transactions except the broker dealer who executes the trade or trades in these securities (subparagraph (f)); the shares are sold in "broker's transactions" only (subparagraph (g)); the seller files a Notice on Form 144 with the Securities and Exchange Commission at or prior to the sales transactions (subparagraph (h)); and the seller has a bona fide intent to sell the securities within a reasonable time of the filing. Once two years have lapsed, assuming the holder of the securities is not an "affiliate" of the issuer, unlimited sales can be made without further compliance with the terms and provisions of Rule 144. All "restricted securities" of the Company have been held for in excess of one year.
In January, 2000, Richard K. Wulff, the Chief of the Securities and Exchange Commission's Office of Small Business, wrote a letter to Ken Worm, the Assistant Director of the OTC Compliance Unit of NASD Regulation, Inc. Many members of the securities community have come to refer to that letter as the "Wulff letter."
The Wulff letter was written in response to a request for guidance from Mr. Worm. In his request, Mr. Worm had referred to several situations in which non-affiliate stockholders of "blank check" issuers had sought to treat their shares as "free-trading" or unrestricted securities. As defined in the Wulff letter, a blank check company is "a development stage company that has no specific business plan or purpose or has indicated its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person."
Citing the concerns of the United States Congress and the Securities and Exchange Commission over potential fraud and market manipulations involving blank check companies, the Wulff letter stated that affiliates of blank check issuers, as well as transferees of their securities, are "underwriters" with respect to such securities. Accordingly, transactions in these companies' securities by promoters, affiliates or their transferees do not fall within the scope of the Rule 144 "safe harbor" resales for securities that have been beneficially owned for at least one year and that satisfy informational and certain other requirements of the Rule, or the Section 4(1) exemption from registration for resales under the Securities Act of 1933, as amended (the "Securities Act"), that exempts sales by persons other than "an issuer, underwriter or a dealer." As a result, it is the position of the Securities and Exchange Commission that these securities may be resold by these persons only pursuant to registration under the Securities Act. According to the Wulff letter, this restriction would continue to apply even after the blank check company completes a merger or acquisition transaction with an operating entity.
While disputing the application of the Wulff letter to the securities of the Company that are owned by Duane S. Jenson, Travis T. Jenson, Thomas J. Howells and Leonard W. Burningham, collectively amounting to 23,908,683 shares or approximately 97.3% of our outstanding voting securities, these persons have agreed not to publicly resell these securities (in any private sale, the purchaser would be required to acknowledge the following restrictions) without registration under the Securities Act; or the receipt of a "no action" letter from the Securities and Exchange Commission indicating that registration is not required and that there is an available exemption from registration under the Securities Act for the resale of these securities; or there is a declaratory judgment by a federal or state court indicating that registration is not required for resale of these securities and that there is an available exemption from registration under the Securities Act for the resale of these securities. A copy of the Registration Agreement signed by Messrs. Jenson, Howells and Burningham with us are attached to this Report and are incorporated herein by reference. See Part III, Item 13.
There were no proceeds received during the calendar year ended December 31, 2001, 2002, 2003 or 2004, from the sale of registered securities.
There were no purchases of our equity securities by us or any affiliated purchasers during the calendar year ended December 31, 2001, 2002, 2003 or 2004.
Forward-looking Statements
Statements made in this Annual Report which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and business of our Company, including, without limitation, (i) our ability to raise capital, and (ii) statements preceded by, followed by or that include the words "may", "would", "could", "should", "expects", "projects", "anticipates", "believes", "estimates", "plans", "intends", "targets" or similar expressions.
Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond our Company's control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following, general economic or industry conditions, nationally and/or in the communities in which our Company conducts business, changes in the interest rate environment, legislation or regulatory requirements, conditions of the securities markets, our ability to raise capital, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting our Company's operations, products, services and prices.
Accordingly, results actually achieved may differ materially from expected results in these statements. Forward-looking statements speak only as of the date they are made. Our Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements.
Plan of Operation
Our Company's plan of operation for the next 12 months is to:(i)consider guidelines of industries in which our Company may have an interest;(ii) adopt a business plan regarding engaging in the business of any selected industry; and (iii) to commence such operations through funding and/or the acquisition of a "going concern" engaged in any industry selected.
During the next 12 months, our Company's only foreseeable cash requirements will relate to maintaining our Company in good standing or the payment of expenses associated with legal fees, accounting fees and reviewing or investigating any potential business venture, which may be advanced by management or principal stockholders as loans to our Company. Because we have not determined any business or industry in which our operations will be commenced, and we have not identified any prospective venture as of the date of this Annual Report, it is impossible to predict the amount of any such loan. Any such loan will be on terms no less favorable to our Company than would be available from a commercial lender in an arm's length transaction. As of the date of this Annual Report, our Company has not actively begun to seek any such venture. No advance or loan from any affiliate will be required to be repaid as a condition to any agreement with future acquisition partners.
Results of Operations
Our Company has generated no profit since inception. Our Company generated a net loss of ($5,183), for the year ended December 31, 2001, and ($3,651) for the year ended December 31, 2000. Cumulative income totaled $1,183,892 since our gain on extinguishment of debt. Primarily all of these losses are the result of attorney's fees and accounting fees.
Liquidity
During calendar 2001, expenses were paid by a principal stockholder in the amount of $3,733; and during calendar 2000, additional expenses by a principal stockholder totaled $3,651. This aggregate amount of $8,438 outstanding as of December 31, 2001, is unsecured, non-interest bearing and is due on demand.
ATLANTICA, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
December 31, 2001
C O N T E N T S
Report of Independent Registered Public Accounting Firm. . . . 3 Balance Sheet. . . . . . . . . . . . . . . . . . . . . . . . . 4 Statements of Operations . . . . . . . . . . . . . . . . . . . 5 Statements of Stockholders' Equity (Deficit) . . . . . . . . . 6 Statements of Cash Flows . . . . . . . . . . . . . . . . . . . 7 Notes to the Financial Statements. . . . . . . . . . . . . . . 8 |
INDEPENDENT AUDITORS' REPORT
To the Stockholders of
Atlantica, Inc.
(A Development Stage Company)
Salt Lake City, UT
We have audited the accompanying balance sheet of Atlantica, Inc. (a development stage company) as of December 31, 2001 and the related statements of operations, stockholders' equity (deficit) and cash flows for the years ended December 31, 2001 and 2000 and from inception of the development stage on January 1, 1997 through December 31, 2001. 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 auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit 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 Atlantica, Inc. (a development stage company) as of December 31, 2001 and the results of its operations and its cash flows for the years ended December 31, 2001 and 2000 and from inception of the development stage on January 1, 1997 through December 31, 2001 in conformity with accounting principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 5 to the financial statements, the Company is a development stage company with no significant operating results to date, which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 5. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/S/HJ & Associates, LLC HJ & Associates, LLC Salt Lake City, Utah November 1, 2002 |
ATLANTICA, INC.
(A Development Stage Company)
Balance Sheet
ASSETS
December 31,
2001
CURRENT ASSETS
Cash $ -
------------
Total Current Assets -
------------
TOTAL ASSETS $ -
============
|
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Accounts payable $ 3,689
Accounts payable - related party (Note 4) 8,438
Accrued expenses 1,450
------------
Total Current Liabilities 13,577
------------
Total Liabilities 13,577
------------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock: 25,000,000 shares authorized
of $0.0001 par value, 24,581,458 shares issued
and outstanding 2,458
Additional paid-in capital 56,773
Accumulated deficit prior to development stage (1,256,700)
Retained earnings from inception of development
stage on January 1, 1997 1,183,892
-----------
Total Stockholders' Equity (Deficit) (13,577)
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ -
===========
|
The accompanying notes are an integral part of these financial statements.
ATLANTICA, INC.
(A Development Stage Company)
Statements of Operations
From
Inception of
Development
Stage on
For the January 1,
Years Ended 1997 Through
December 31, December 31,
2001 2000 2001
REVENUES $ - $ - $ -
EXPENSES
General and administrative 4,521 3,651 62,133
Interest expense 662 - 106,862
---------- --------- ---------
Total Expenses 5,183 3,651 168,995
---------- --------- ---------
NET LOSS BEFORE EXTRAORDINARY ITEMS (5,183) (3,651) (168,995)
|
EXTRAORDINARY INCOME
Gain on extinguishment of debt (Note 2) - - 1,352,887
---------- --------- ----------
NET INCOME (LOSS) $ (5,183) $ (3,651) $1,183,892
========== ========= ==========
BASIC INCOME (LOSS) PER SHARE
Continuing operations $ (0.00) $ (0.00)
Extraordinary income (0.00) (0.00)
---------- ---------
Basic Income (Loss) Per Share $ (0.00) $ (0.00)
========== =========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 24,581,458 24,581,458
========== ==========
|
The accompanying notes are an integral part of these financial statements.
ATLANTICA, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Additional
Common Stock Paid-In Accumulated
Shares Amount Capital Deficit
Inception of development
stage, January 1, 1997 531,458 $ 53 $ (53) $(1,256,700)
Expenses paid on the
Company's behalf - - 39,957 -
Net loss for the year ended
December 31, 1997 - - - (93,057)
---------- ------- -------- -----------
Balance, December 31, 1997 531,458 53 39,904 (1,349,757)
March 13, 1998, common
stock issued for services
at $0.0001 per share 24,050,000 2,405 - -
Expenses paid on the
Company's behalf - - 6,856 -
Net loss for the year
ended December 31, 1998 - - - (62,361)
---------- ------- -------- -----------
Balance, December 31, 1998 24,581,458 2,458 46,760 (1,412,118)
Expenses paid on the
Company's behalf - - 10,013 -
Net income for the year
ended December 31, 1999 - - - 1,348,144
---------- ------- -------- -----------
Balance, December 31, 1999 24,581,458 2,458 56,773 (63,974)
Net loss for the year
ended December 31, 2000 - - - (3,651)
---------- ------- -------- -----------
Balance, December 31, 2000 24,581,458 2,458 56,773 (67,625)
Net loss for the year
ended December 31, 2001 - - - (5,183)
---------- ------- -------- -----------
Balance, December 31, 2001 24,581,458 2,458 56,773 (72,808)
========== ======= ======== ===========
Accumulated deficit prior to development stage $(1,256,700)
Retained earnings from inception of development stage $ 1,183,892
-----------
Accumulated deficit $ (72,808)
===========
|
The accompanying notes are an integral part of these financial statements.
ATLANTICA, INC.
(A Development Stage Company)
Statements of Cash Flows
From
Inception of
Development
Stage on
For the January 1,
Years Ended 1997 Through
December 31, December 31,
2001 2000 2001
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (5,183) $ (3,651) $ 1,183,892
Adjustments to reconcile net
income (loss) to net cash used
by operating activities:
Common stock issued for services - - 2,405
Extinguishment of debt - - (1,352,887)
Changes in operating assets and
liabilities:
Increase in accounts payable and
accounts payable - related party 3,733 3,651 2,114
Increase in accrued expenses 1,450 - 107,650
--------- -------- ------------
Net Cash Used by Operating
Activities - - (56,826)
--------- -------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES - - -
--------- -------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Capital contributed by shareholder - - 56,826
--------- -------- ------------
Net Cash Provided by Financing
Activities - - 56,826
--------- -------- ------------
NET INCREASE (DECREASE) IN CASH - - -
--------- -------- ------------
CASH AT BEGINNING OF PERIOD - - -
--------- -------- ------------
CASH AT END OF PERIOD $ - $ - $ -
========= ======== ============
CASH PAID FOR:
Interest $ - $ - $ -
Taxes $ - $ - $ -
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SCHEDULE OF NON-CASH FINANCING ACTIVITIES
Common stock issued for services $ - $ - $ 2,405
ATLANTICA, INC.
(A Development Stage Company)
Notes to the Financial Statements December 31, 2001
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies of Atlantica, Inc. is presented to assist in understanding the Company's financial statements. The financial statements and notes are representations of the Company's management, which 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 Business Activities
The financial statements presented are those of Atlantica, Inc. (the Company). The Company was incorporated in the State of Utah on March 3, 1938. The Company name at that time was Red Hills Mining Company. On February 5, 1953, the Company changed its name to Allied Oil and Minerals Company. On January 8, 1971, the Company changed its name to Community Equities Corporation. On March 26, 1996, the Company changed its name to Atlantica, Inc.
The Company had two subsidiaries; Keys Equities, Inc. (Keys), a Florida corporation incorporated on July 31, 1996, and Allied Equities, Inc. (Allied), a Florida corporation incorporated on July 15, 1996. On March 1, 1998, the Company transferred its right, title and interest in a mining claim in Utah to Allied. The mining claim had a book value of $- 0-. On March 1, 1998, the Company distributed the shares of the two subsidiaries to its shareholders in a liquidating dividend.
The Company has not engaged in any business operations since 1990, and it was reclassified as a development stage company as of January 1, 1997. The Company's only activity since that time has consisted of taking actions necessary to restore and preserve its good standing in the State of Utah. The Company presently has no assets. The Company intends to continue to seek out the acquisition of assets, property or a business that may be beneficial to the Company and its stockholders. In considering whether to complete any such acquisition, the Board of Directors will make the final determination and the approval of stockholders will not be sought unless required by applicable law, the articles of incorporation or bylaws of the Company or contract.
b. Accounting Method
The Company's financial statements are prepared using the accrual method of accounting. The Company has elected a December 31 year-end.
c. Estimates
The preparations 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 revenues and expenses during the reporting period. Actual results could differ from those estimates.
ATLANTICA, INC.
(A Development Stage Company)
Notes to the Financial Statements December 31, 2001 and 2000
NOTE 1 - SUMMARY OF SIGNFICANT ACCOUNTING POLICIES (Continued)
d. Income Taxes
At December 31, 2001 the Company had net operating loss carryforwards of approximately $70,403 that may be offset against future taxable income through 2021 No tax benefits has been reported in the financial statements, because the potential tax benefits of the net operating loss carry forwards are offset by a valuation allowance of the same amount.
Deferred tax assets (liabilities) are comprised of the following:
For the Years Ended
December 31,
2001 2000
Income tax benefit at statutory rate $ 26,753 $ 24,783
Change in valuation allowance (26,753) (24,783)
-------- --------
$ - $ -
======== ========
|
The income tax benefit differs from the amount computed at federal statutory rates of approximately 38% as follows:
For the Years Ended
December 31,
2001 2000
Income tax benefit at statutory rate $ 1,970 $ 1,387
Change in valuation allowance (1,970) (1,387)
------- --------
$ - $ -
======= ========
|
Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carryforwards for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carryforwards may be limited as to use in the future.
ATLANTICA, INC.
(A Development Stage Company)
Notes to the Financial Statements December 31, 2001 and 2000
NOTE 1 - SUMMARY OF SIGNFICANT ACCOUNTING POLICIES (Continued)
e. Basic Income (Loss) Per Share
The computation of basic income (loss) per share of common stock is based on the weighted average number of shares outstanding during the period.
For the Year Ended
December 31, 2001
Income Shares Per Share
(Numerator) (Denominator) Amount
$ (5,183) 24,581,458 $ (0.00)
For the Year Ended
December 31, 2000
(Loss) Shares Per Share
(Numerator) (Denominator) Amount
$ (3,651) 24,581,458 $ (0.00)
|
f. Revenue Recognition Policy
The Company currently has no source of revenues. Revenue recognition policies will be determined when principal operations begin.
g. Recent Accounting Pronouncements
The Company has adopted the provisions of FASB Statement No. 140 "Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities (a replacement of FASB Statement No. 125)." This statement provides accounting and reporting standards for transfers and servicing of financial assets and extinguishments of liabilities.
Those standards are based on consistent application of a financial- components approach that focuses on control. Under that approach, the transfer of financial assets, the Company recognized the financial and servicing assets it controls and the liabilities it has incurred, derecognizes financial assets when control has been surrendered, and derecognizes liabilities when extinguished. This statement provides consistent standards for distinguishing transfers of financial assets that are sales from transfers that are secured borrowings.
This statement is effective for transfers and servicing of financial assets and extingushments of liabilities occurring after March 31, 2001. This statement is effective for recognition and reclassification of collateral and for disclosures relating to securitization transactions and collateral for fiscal years ending after December 15, 2000. The adoption of this principle had no material effect on the Company's financial statements.
ATLANTICA, INC.
(A Development Stage Company)
Notes to the Financial Statements December 31, 2001 and 2000
NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
g. Recent Accounting Pronouncements (Continued)
The Company had adopted the provisions of FIN 44 "Accounting for Certain Transactions Involving Stock Compensation (an interpretation of APB Opinion No. 25)." This interpretation is effective July 1, 2000. FIN 44 clarifies the application of Opinion No. 25 for only certain issues. It does not address and issues related to the application of the fair value method in Statement No. 123.
Among other issues, FIN 44 clarifies the definition of employee for purposes of applying Opinion 25, the criteria for determining whether a plan qualifies as a noncompensatory plan, the accounting consequence of various modifications to the terms of a previously fixed stock option or award, and accounting for an exchange of stock compensation awards in a business combination. The adoption of this principle had no material effect on the Company's financial statements.
SFAS No.'s 141 and 142 In June 2001, the Financial Accounting Standards Board (FASB) adopted Statement of Financial Accounting Standards SFAS No. 141, "Business Combinations," and SFAS N. 142, "Goodwill and Other Intangible Assets." SFAS No. 141 is effective as to any business combination occurring after June 30, 2001 and certain transition provisions that affect accounting for business combinations prior to June 30, 2001 are effective as of the date that SFAS No. 142 is applied, in its entirety, which will be January 1, 2002 for the Company. SFAS No. 142 is effective, generally, in fiscal years beginning after December 15, 2001, which will be the fiscal year ending April 30, 2002 for the Company.
SFAS No. 141 provides standards for accounting for business combinations. Among other things, it requires that only the purchase method of accounting be used and that certain intangible assets acquired in a business combination (i.e. those that result from contractual or other legal rights or are separable) be recorded as an asset apart from goodwill. The transition provisions require that an assessment be made of previous business combinations and, if appropriate, reclassifications be made to or from goodwill to adjust the recording of intangible assets such that the criteria for recording intangible assets apart from goodwill is applied to the previous business combinations.
SFAS No. 142 provides, among other things, that goodwill and intangible assets with indeterminate lives shall not be amortized. Goodwill shall be assigned to a reporting unit and annually assessed for impairment. Intangible assets with determinate lives shall be amortized over their estimated useful lives, with the useful lives reassessed continuously, and shall be assessed for impairment under the provisions of SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for long-Lived Assets to be Disposed Of." Goodwill is also assessed for impairment on an interim basis when events and circumstances warrant. Upon adoption of SFAS No. 142, the Company will assess whether an impairment loss should be recognized and measured by comparing the fair value of the "reporting unit" to the carrying value, including goodwill.
If the carrying value exceeds fair value, then the Company will compare the implied fair value of the goodwill (as defined in SFAS No. 142) to the carrying amount of the goodwill. If the carrying amount of the goodwill exceeds the implied fair value, then the goodwill be adjusted to the implied fair value.
ATLANTICA, INC.
(A Development Stage Company)
Notes to the Financial Statements December 31, 2001 and 2000
NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
g. Recent Accounting Pronouncements (Continued)
While the Company has not completed the process of determining the effect of these new accounting pronouncements on its financial statements, the Company currently expects that there will be no reclassification in connection with the transition provisions of SFAS No. 141 based on clarifications of the transition provisions issued by the FASB in October 2001. Accordingly, the Company expects that, after implementation of SFAS No. 142, all intangible assets will be amortizable and the goodwill will not be amortizable.
SFAS No. 143 On August 16, 2001, the FASB issued SFAS No. 143,
"Accounting for Asset Retirement Obligations," which is effective for
fiscal years beginning after June 15, 2002. it requires that
obligations associated with the retirement of a tangible long-lived
asset be recorded as a liability when those obligations are incurred,
with the amount of liability initially measured at fair value. Upon
initially recognizing a liability for an accrued retirement
obligation, an entity must capitalize the cost by recognizing an
increase in the carrying amount of the related long-lived asset. Over
time, the liability is accreted to its present value each period, and
the capitalized cost is depreciated over the useful life of the
related asset.
Upon settlement of the liability, an entity either settles the
obligation for its recorded amount or incurs a gain or loss upon
settlement.
While the Company has not completed the process of determining the effect of this new accounting pronouncement on its financial statements, the Company currently expects that the effect of SFAS No. 143 on the Company's financial statements, when it becomes effective, will not be significant.
SFAS No. 144 On October 3, 2001, the Financial Accounting Standards Board issued SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets," which is effective for financial statements issued for fiscal years beginning after December 15, 2001 and, generally, its provisions are to be applied prospectively. SFAS 144 supercedes SFAS Statement No. 121 (FAS 121), "Accounting for the Impairment of Long-Lives Addets and for Long-Lived Assets to be Disposed Of." SFAS 144 applies to all long-lived assets (including discontinued operations) and consequently amends Accounting Principles Board Opinion No. 30 (APB 30), "Reporting Results of Operations Reporting the Effects of Disposal of a Segment of a Business."
SFAS 144 develops one accounting model (based on the model in SFAS 121) for long-lived assets that are to be disposed of by sale, as well as addresses the principle implementation issues. SFAS 144 requires that long-lived assets are to be disposed of be sale to be measured at the lower book value or fair value less cost to sale. That requirement eliminates the requirement of APB 30 that discontinued operations be measured at net realizable value or that entities include under 'discontinued operations' in the financial statements amounts for operating losses that have not yet occurred.
h. Advertising
The Company follows the policy of charging the costs of advertising to expense as incurred. Advertising expense for the years ended December 31, 2001 and 2000 was $-0-, and $-0-, respectively.
ATLANTICA, INC.
(A Development Stage Company)
Notes to the Financial Statements December 31, 2001 and 2000
NOTE 2 - GAIN ON EXTINGUISHMENT OF DEBT
In 1990, the Company signed as a guarantor of a mortgage. The primary mortgager has defaulted on the loan so the Company had recorded the liability on its books.
On February 18, 1999, the Company entered into negotiations with the City of Miami for a settlement agreement which would release the Company from the mortgage payable. Under the terms of the agreement, the City of Miami agreed to execute and deliver to the Company a release of lien. In return, a shareholder of the Company paid the City of Miami $10,010 and transferred to the City 25,000 shares of the Company?s common stock owned personally by the shareholder.
As a result of the settlement, the Company recorded a gain on the extinguishment of debt totaling $1,352,887 ($885,000 principal and $477,900 accrued interest minus $10,013 for cash and common stock paid) for the year ended December 31, 1999. In addition, contributed capital of $10,013 was recorded which represented the cash paid by the shareholder to the City of Miami and the value of the 25,000 shares transferred.
NOTE 3 - COMMON STOCK
On March 13, 1998, the Company approved a 20-to-1 reverse stock split. After the split, the Company had authorized 25,000,000 shares and changed the par value from $0.01 to $0.0001. On this same date, 24,050,000 shares were issued to the directors of the Company for services rendered, valued at $0.0001 per share. The stock split is reflected on a retroactive basis.
NOTE 4 - RELATED PARTY TRANSACTIONS
Expenses incurred by the Company for legal and filing fees were paid out-of-pocket by a related party. On May 11, 1998, the shareholders of the Company completed a quasi-reorganization whereby the accumulated deficit of the Company was offset against paid-in capital to the extent possible. The quasi-reorganization has been reflected on a retroactive basis.
Expenses paid during the years ended December 31, 1999, 1998 and 1997 were paid by the Company's President and were recorded as additional paid-in capital. Expenses during the year ended December 31, 2001 and 2000 were paid by certain related parties and recorded as loans to shareholders totaling $8,438 at December 31, 2001.
NOTE 5 - GOING CONCERN
The Company's financial statements are prepared using generally accepted accounting principles applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not established revenues sufficient to cover its operation costs. The Company is seeking the acquisition of, or merger with, an existing operating company. Currently, management has committed to covering all operating and other costs until sufficient revenues are generated.
There has been no change in our auditors.
As of the end of the period covered by this Annual Report, we carried out an evaluation, under the supervision and with the participation of our President and Secretary, of the effectiveness of our disclosure controls and procedures. Based on this evaluation, our President and Secretary concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic Securities and Exchange Commission reports. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. In addition, we reviewed our internal controls over financial reporting, and there have been no changes in our internal controls or in other factors in the last fiscal quarter that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.
None.
PART III
The following table sets forth the names and the nature of all positions and offices held by all directors and executive officers of our Company for the years ending December 31, 2004, 2003, 2002, and 2001, and to the date hereof, and the period or periods during which each such director or executive officer served in his or her respective positions.
Name Held Designation or Resignation
---- ---- ----------- --------------
Thomas J. Howells President, 10/30/02 *
Director 10/30/02 *
Terry Jenson Vice President, 10/30/02 *
Director 10/30/02 *
Travis T. Jenson Secretary 10/30/02 *
Director 10/30/02 *
Gregory Aurre II President 3/13/98 10/30/02
Director 3/13/98 10/30/02
Gregory Aurre III Secretary 3/13/98 10/30/02
Treasurer 3/13/98 10/30/02
Director 3/13/98 10/30/02
Amerika Aurre Director 3/13/98 10/30/02
|
* These persons presently serve in the capacities indicated.
Term of Office
The term of office of the current directors continues until the annual meeting of stockholders, which has been scheduled by the Board of Directors to be held in March of each year. The annual meeting of the Board of Directors immediately follows the annual meeting of stockholders, at which officers for the coming year are elected.
Business Experience
Thomas J. Howells, President and a director is 32 years of age. Mr. Howells graduated from Westminster College of Salt Lake City, Utah, with a bachelors degree in Business in 1995 and Master of Business Administration in 2004. Mr. Howells has been an employee of Jenson Services, Inc., a Utah Corporation since 1995.
Terry Jenson, Vice President and director, is 55 years of age. Ms. Jenson graduated Cum Laude from the University of Utah in 1976 with a B.S. in Nursing. From 1984 to 2000, Ms. Jenson was employed at Primary Children's Medical Center as the Chief Flight Nurse and staff nurse for the Neonatal Life Flight unit. Since 2000, Ms. Jenson has been retired.
Travis T. Jenson, Secretary and director, is 32 years of age. Mr. Jenson graduated with honors from Westminster College in 1995 with a B.S. Since January of 1996, Mr. Jenson has worked for Jenson Services, Inc., a Utah corporation and financial consulting firm.
Terry Jenson is the wife of Travis T. Jenson's father, Duane S. Jenson.
Except as indicated below and to the knowledge of management, during the past five years, no present or former director, person nominated to become a director, executive officer, promoter or control person of our Company:
(1) Was a general partner or executive officer of any business by or against which any bankruptcy petition was filed, whether at the time of such filing or two years prior thereto;
(2) Was convicted in a criminal proceeding or named the subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);
(3) Was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting, the following activities:
(i) Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;
(ii) Engaging in any type of business practice; or
(iii) Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of federal or state securities laws or federal commodities laws;
(4) Was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described above under this Item, or to be associated with persons engaged in any such activity;
(5) Was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Securities and Exchange Commission has not been subsequently reversed, suspended, or vacated; or
(6) Was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated.
To our knowledge, during our past fiscal year and since then, all filings required to be made by members of management or others pursuant to Section 16(a) of the Exchange Act have been duly filed with the Securities and Exchange Commission.
We have no audit committee, and we are not required to have an audit committee; we do not believe the lack of an audit committee will have any adverse effect on our financial statements, based upon our current lack of any business operations. We will assess whether an audit committee may be necessary in the future.
We have adopted a Code of Ethics that is attached as Exhibit 14 to this Annual Report. See Part III, Item 13.
The following table sets forth the aggregate compensation paid by the Company for services rendered during the periods indicated:
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards Payouts
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Name and Years or other all
principal periods Annual restricted option/ LTIP other
position Ended $ $ Compen- Stock SAR's PayoutsCompen-
Salary Bonus sation awards$ # $ sation$
----------------------------------------------------------------------------
Thomas J. 12/31/04 0 0 0 0 0 0 0
Howells 12/31/03 0 0 0 0 0 0 0
President,12/31/02 0 0 0 0 0 0 0
Director
Terry 12/31/04 0 0 0 0 0 0 0
Jenson 12/31/03 0 0 0 0 0 0 0
Vice Pres,12/31/02 0 0 0 0 0 0 0
Director
Travis T. 12/31/04 0 0 0 0 0 0 0
Jenson 12/31/03 0 0 0 0 0 0 0
Secretary,12/31/02 0 0 0 0 0 0 0
Director
Gregory 12/31/02 0 0 0 0 0 0 0
Aurre II 12/31/01 0 0 0 0 0 0 0
President,
Director
Amerika 12/31/02 0 0 0 0 0 0 0
Aurre 12/31/01 0 0 0 0 0 0 0
Vice Pres,
Director
Gregory 12/31/02 0 0 0 0 0 0 0
|
Aurre III 12/31/01 0 0 0 0 0 0 0
Secretary,
Director
No cash compensation, deferred compensation or long-term incentive plan awards were issued or granted to our Company's management during the calendar years ended December 31, 2004, 2003, 2002 or 2001. Further, no member of our Company's management has been granted any option or stock appreciation rights; accordingly, no tables relating to such items have been included within this Item.
There are no standard arrangements pursuant to which our Company's directors are compensated for any services provided as director. No additional amounts are payable to our Company's directors for committee participation or special assignments.
There are no employment contracts, compensatory plans or arrangements, including payments to be received from our Company, with respect to any director or executive officer of our Company which would in any way result in payments to any such person because of his or her resignation, retirement or other termination of employment with our Company, any change in control of the Company, or a change in the person's responsibilities following a change in control of our Company.
The following table sets forth the shareholdings of those persons who own more than five percent of our Company's common stock as of December 31, 2001, 2002, 2003, 2004, and to the date hereof:
Number and Percentage of
Shares Beneficially Owned
----------------------------
Name and Address 12/31/01 12/31/02 12/31/03 12/31/04 Currently %
---------------- -------- --------- --------- --------- --------- -
Gregory Aurre II 23,908,000* -0- -0- -0- -0- 0.0%
Duane S. Jenson -0- 12,000,683 12,000,683 12,000,683 12,000,683 48.8%
Travis T. Jenson -0- 4,000,000 4,000,000 4,000,000 4,000,000 16.3%
Thomas J. Howells -0- 4,000,000 4,000,000 4,000,000 4,000,000 16.3%
Leonard W. Burningham -0- 3,908,000 3,908,000 3,908,000 3,908,000 15.9%
----------
TOTALS: 23,908,683 97.3%
|
* Mr. Jenson had personally loaned Mr. Aurre $80,000 which was secured solely by Mr. Aurre's shares of Atlantica. Subsequent to foreclosing on the shares of Mr. Aurre's that were held by Mr. Jenson as security for the loan, Mr. Jenson elected to gift a portion of those shares to his son, Travis T. Jenson, as well as to a business associate, Thomas J. Howells, and a long-time close personal friend and legal counsel, Leonard W. Burningham, Esq. See Part I, Item 1.
The following table sets forth the share holdings of our Company's directors and executive officers as of December 31, 2001, 2002, 2003, 2004, and to the date hereof:
Number and Percentage of
Shares Beneficially Owned
----------------------------
Name and Address 12/31/01 12/31/02 12/31/03 12/31/04 Currently %
---------------- -------- --------- --------- --------- --------- -
Gregory Aurre II 23,908,000 -0- -0- -0- -0- 0.0%
Gregory Aurre III 25,000 25,000 25,000 25,000 25,000 0.1%
Amerika Aurre 25,000 25,000 25,000 25,000 25,000 0.1%
Duane S. Jenson* -0- 12,000,683 12,000,683 12,000,683 12,000,683 48.8%
Travis T. Jenson -0- 4,000,000 4,000,000 4,000,000 4,000,000 16.3%
Thomas J. Howells -0- 4,000,000 4,000,000 4,000,000 4,000,000 16.3%
----------
TOTALS: 20,000,683 81.4%
|
* Terry Jenson, our Vice President, is the wife of Duane S. Jenson and therefore beneficially owns the shares indirectly above.
There are no present arrangements or pledges of our Company's securities which may result in a change in control of our Company.
There were no material transactions, or series of similar transactions, during our Company's last four fiscal years, or any currently proposed transactions, or series of similar transactions, to which our Company or any of our subsidiaries was or is to be a party, in which the amount involved exceeded $60,000 and in which any director, executive officer or any security holder who is known to us to own of record or beneficially more than five percent of any class of our common stock, or any member of the immediate family of any of the foregoing persons, had an interest.
There were no material transactions, or series of similar transactions, during our Company's last four fiscal years, or any currently proposed transactions, or series of similar transactions, to which we or any of our subsidiaries was or is to be a party, in which the amount involved exceeded $60,000 and in which any director, executive officer or any security holder who is known to us to own of record or beneficially more than five percent of any class of our common stock, or any member of the immediate family of any of the foregoing persons, had an interest.
There were no material transactions, or series of similar transactions, during our Company's last four fiscal years, or any currently proposed transactions, or series of similar transactions, to which we or any of our subsidiaries was or is to be a party, in which the amount involved exceeded $60,000 and in which any director, executive officer or any security holder who is known to us to own of record or beneficially more than five percent of any class of our common stock, or any member of the immediate family of any of the foregoing persons, had an interest.
There were no material transactions, or series of similar transactions, during our Company's last four fiscal years, or any currently proposed transactions, or series of similar transactions, to which we or any of our subsidiaries was or is to be a party, in which the amount involved exceeded $60,000 and in which any promoter or founder of ours or any member of the immediate family of any of the foregoing persons, had an interest.
None.
Exhibits
Number
------
(i)
3 By-laws
14 Code of Ethics
31.1 Certification of Thomas J. Howells
31.2 Certification of Travis T. Jenson
32 906 Certification.
99 Registration Agreement of Duane S. Jenson, Travis T. Jenson, Thomas
J. Howells and Leonard W. Burningham
|
10-SB Registration Statement, as amended - Part I*
*Previously filed and incorporated herein by reference.
The following is a summary of the fees billed to us by our principal accountants during the years ended December 31, 2004, 2003, 2002, and 2001:
Fee category 2004 2003 2002 2001
------------ ---- ---- ---- ----
Audit fees $6,479 $ 0 $ 0 $ 0
Audit-related fees $ 0 $ 0 $ 0 $ 0
Tax fees $ 0 $ 0 $ 0 $ 0
All other fees $ 0 $ 0 $ 0 $ 0
------ ------ ------ ------
Total fees $6,479 $ 0 $ 0 $ 0
|
Audit fees. Consists of fees for professional services rendered by our principal accountants for the audit of our annual financial statements and the review of financial statements included in our Forms 10-QSB Quarterly Reports or services that are normally provided by our principal accountants in connection with statutory and regulatory filings or engagements.
Audit-related fees. Consists of fees for assurance and related services by our principal accountants that are reasonably related to the performance of the audit or review of our financial statements and are not reported under "Audit fees."
Tax fees. Consists of fees for professional services rendered by our principal accountants for tax compliance, tax advice and tax planning.
All other fees. Consists of fees for products and services provided by our principal accountants, other than the services reported under "Audit fees," "Audit-related fees" and "Tax fees" above.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.
ATLANTICA, INC.
Date: 6/24/2005 By:/s/Thomas J. Howells
---------- ---------------------
Thomas J. Howells, President
and Director
Date: 6/24/2005 By:/s/Terry Jenson
---------- -----------------------
Terry Jenson, Vice President
and Director
Date: 6/24/2005 By:/s/Travis T. Jenson
---------- -----------------------
Travis T. Jenson, Secretary
and Director
|
In accordance with the Exchange Act, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:
ATLANTICA, INC.
Date: 6/24/2005 By:/s/Thomas J. Howells
---------- ---------------------
Thomas J. Howells, President
and Director
Date: 6/24/2005 By:/s/Terry Jenson
---------- -----------------------
Terry Jenson, Vice President
and Director
Date: 6/24/2005 By:/s/Travis T. Jenson
---------- -----------------------
Travis T. Jenson, Secretary
and Director
|
Exhibit 3
BY-LAWS
OF
ATLANTICA, INC.
ADOPTED
March 13, 1998
ARTICLE I OFFICES
The principal office of the corporation shall be in any of the 48 contiguous states of the United States of America. As The Board of Directors may designate.
ARTICLE II - STOCKHOLDERS
1. Annual meeting. The annual meeting of stockholders shall be held in March of each year at the principle office of the company, at I PM., on a normal business day, with 10 days notice to all shareholders.
2. Special meeting. Special meeting of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute, may be called by the president or the directors, and shall be called by the president at the request of the holders of not less than 50% of all the outstanding shares of the corporation entitled to vote at the meeting. A special meeting can take the place of the annual meeting, with 10 days notice to all shareholders.
3. Notice of meeting Written notice stating the place, day and hour of the meeting and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be mailed 10 days prior the meeting by 1 st class mail.
4. Closing of Transfer books or fixing of record date. The Directors may fix in advance a date as the record date for any such determination of stockholders. Stockholder lists for a ten days notice to shareholders shall be provided by the Transfer Agent as close to the notice date as possible.
5. Quorum. At any meeting of Stockholders 50% of the outstanding shares of the corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of stockholders.
6. Proxies. At all meetings of stockholders, a stockholder may vote by proxy executed in writing by the stockholder or by his duly authorized attorney in fact. Such proxy shall be filed with the secretary of the corporation before or at the time of the meeting.
7. Voting. Each stockholder entitled to vote in accordance with the terms and provisions of the certificate of incorporation and these by-laws shall be entitled to vote, in person or by proxy, for each share of stock entitled to vote held by such stockholder. All matters shall be decided by majority vote except as otherwise provided by the Articles of Incorporation or the laws of the State of Utah.
8. Order of business. The order of business at all meetings of the stockholders, shall be as follows:
1. Roll Call
2. Proof of notice of meeting or waiver of notice.
3. Reading of minutes of preceding meeting.
4. Reports of Officers.
5. Reports of Committees.
6. Election of Directors.
7. Unfinished Business.
8. New Business.
ARTICLE III - BOARD OF DIRECTORS
1. General Powers. The business and affairs of the corporation shall be managed by its board of directors. The directors shall in all cases act as a board, and they may adopt such rules and regulations for the conduct of their meetings and the management of the corporation, as they may deem proper, not inconsistent with these by-laws and the laws of The State of Utah.
2. Numbers, Tenure The number of directors of the corporation shall be at least three and not more than nine. Each director shall hold office until the next annual meeting of stockholders and until his successor shall have been elected.
3. Regular Meetings. A regular meeting of the directors, shall be held without other notice than this by-law immediately after, and at the same place as, the annual meeting of stockholders. The directors may provide, by resolution, the time and place for the holding of additional regular meetings without other notice than such resolution.
4. Special Meeting. Special meeting of the 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 directors may fix the place for holding any special meeting of the directors called by them. Special meetings can be held in person by phone, fax, E-mail, US mail, or any combination.
5. Notice Notice of any special meeting shall be given at least 10 days previously thereto by written notice delivered by fax or mail to each director at his business address.
6. Quorum At any meeting of the directors a majority of the directors elected to serve shall constitute a quorum for the transaction of business.
7. Newly created directorship and vacancies. Newly created directorships resulting from an increase in the number of directors and vacancies occurring in the board for any reason except the removal of directors without cause may be filled by a vote of a majority of the directors than in office, although less than a quorum exists. Vacancies occurring by reason of the removal of directors without cause shall be filled by vote of the stockholders. A director elected to fill a vacancy caused by resignation, death or removal shall be elected to hold office for the unexpired term of his predecessor.
8. Removal of directors. Any or all of the directors may be removed for cause by vote of the stockholders or by action of the board. Directors may be removed without cause only by vote of the stockholders.
9. Resignation. A director may resign at any time by giving written notice to the board, the president or the secretary of the corporation. Unless otherwise specified in the notice, the resignation shall take effect upon receipt thereof by the board or such officer, and the acceptance of the resignation shall not be necessary to make it effective.
10. Compensation No compensation shall be paid to directors, as such, for their services, but by resolution of the board a fixed sum and expenses for actual attendance at each regular or special meeting of the board may authorized. Nothing herein contained shall be construed to preclude any director from serving the corporation in any other capacity and receiving compensation therefor .
11. Presumption of assent. A director of the corporation who is present at a meeting of the directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless his dissent shall be entered in the minutes of the meeting or unless he shall file his written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the secretary of the corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a director who voted in favor of such action.
12. Executive and other committees. The board, by resolution, may designate from among its members an executive committee and other committees, each consisting of three or more directors. Each such committee shall serve at the pleasure of the board.
ARTICLE IV - OFFICERS
1. Number. The officers of the corporation shall be a president, a vice-president, a secretary and a treasurer, each of whom shall be elected by the directors. Such other officers and assistant officers as may be deemed necessary may be elected or appointed by the directors.
2. Election and term of office. The officers of the corporation to be elected by the directors shall be elected annually at the first meeting of the directors held after each annual meeting of the stockholders. Each officer shall hold office until his successor shall have been duly elected and shall have qualified or until his death or until he shall resign or shall have been removed in the manner hereinafter provided.
3. Removal. Any officer or agent elected or appointed by the directors may be removed by the directors whenever in their 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.
4. Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or otherwise, may be filled by the directors for the unexpired portion of the term.
5. President. The president shall be the principal executive officer of the corporation and, subject to the control of the directors, shall in general supervise and control all of the business and affairs of the corporation. He shall, when present, preside at all meetings of the stockholders and of the directors. He may sign, with the secretary or any other proper officers of the corporation thereunto authorized by the directors, certificates for shares of the corporation, any deeds, mortgages, bonds, contracts, or other instruments which the directors have authorized to be executed, except in cases where the signing and execution thereof shall be expressly delegated by the directors or by these by-laws to some other officer or agent of the corporation, or shall be required by law to be otherwise signed or executed; and in general shall perform all duties incident to the office of president and such other duties as may be prescribed by the directors from time to time.
6. Vice-President. In the absence of the president or in 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 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 directors.
7. Secretary. The secretary shall keep the minutes of the stockholders and of the directors meetings in one or more books provided for that purpose, see that all notices are duly given in accordance with the provisions of these by-laws or as required, be custodian of the corporate records and of the seal of the corporation and in general perform all duties incidental to the office of secretary and such other duties as from time to time may be assigned to him by the president or by the directors.
8. Treasurer. The treasurer shall have charge and custody of and be responsible for all funds and securities of the corporation; receive and give receipts for moneys due and payable to the corporation from any source whatsoever, and deposit all such moneys in the name of the corporation in such banks, trust companies or other depositories as shall be selected in accordance with these by-laws and in general perform all of the duties incidental to the office of treasurer and such other duties as from time to time may be assigned to him by the president or by the directors.
9. Salaries. The salaries of the officers shall be fixed from time to time by the 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 V
CONTRACTS, LOANS, CHECKS AND DEPOSITS
1. Contracts. The directors may authorized 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.
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 directors. Such authority may be general or confined to specific instances.
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 directors.
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 depositaries as the directors may select.
ARTICLE VI - FISCAL YEAR
The fiscal year of the corporation shall begin on the first day of January each year.
ARTICLE VII - DIVIDENDS
The 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.
ARTICLE VIII - SEAL
The directors shall provide a corporate seal; which shall be the same as the one hereby affixed:
ARTICLE IX - WAIVER OF NOTICE
Unless otherwise provided by law, whenever any notice is required to be given to any stockholder or director 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.
ARTICLE X- AMENDMENTS
These by-laws may be altered, amended or repealed and new by-laws may be adopted by a vote of the stockholders representing a majority of all the shares issued and outstanding, at any annual stockholder meeting or at any special stockholder meeting when the proposed amendment has been set out in the notice of such meeting.
This Code of Conduct (this "Code") is applicable to the (1) President and Chief Executive Officer, (2) Chief Financial Officer, (3) Chief Accounting Officer or Controller and (4) other persons performing similar functions (collectively, the "Covered Executives") of Atlantica, Inc. ("Atlantica"). As used in this Code, "we", "our" or "us" means Atlantica, and "you" means a Covered Executive. The Covered Executives hold an important and elevated role in corporate governance, and are uniquely positioned and empowered to ensure that Atlantica's interests are appropriately balanced, protected and preserved. Atlantica's Board of Directors (the "Board") has adopted this Code to deter wrongdoing and to promote honest and ethical conduct, proper disclosure of financial information in Atlantica's periodic reports and compliance with applicable laws, rules and regulations by Atlantica's senior officers who have financial responsibilities.
In performing your duties, we expect you to:
* Conduct yourself honestly and ethically, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships.
* Refrain from using your position for personal gain or competing directly or indirectly with Atlantica.
* Provide, or cause to be provided, full, fair, accurate, timely and understandable disclosures in (i) reports and documents that we file with the Securities and Exchange Commission (the "SEC") and (ii) in other public communications made by us.
* Comply, and encourage others reporting to you to comply, in all material respects to all applicable rules and regulations of federal, state and local governments, the SEC and other appropriate private and public regulatory agencies.
* Comply, and encourage others reporting to you to comply, with this Code and all other codes of business conduct or ethics adopted by us from time to time.
1 This Code is specifically intended to meet the requirements of Section 406 of the Sarbanes-Oxley Act of 2002 (including any amendments).
The Board will have the sole and absolute discretionary authority to approve any changes to this Code and any waivers from this Code. Any waiver from this Code, including an implicit waiver, for a Covered Executive will be promptly disclosed on a Form 8-K or any other means approved by the SEC. Such disclosure will include the nature of the waiver, the name of the Covered Executive to whom the Board granted the waiver and the date of the waiver. Any change to this Code will be promptly disclosed as required by law or regulation of the SEC.
Procedures for Raising Concerns. You are expected to comply with this Code and to report any possible violation of this Code, so that it can be investigated and evaluated. Concerns may be presented in person or in writing to a member of the Board. Concerns may be reported on a confidential and anonymous basis. Written concerns should be addressed to a member of the Board at Atlantica, Inc., Attention: Board of Directors, 4685 South Highland Drive, Suite #202, Salt Lake City, Utah 84117.
Procedures for Investigating and Resolving Concerns. Reports of possible violations will be forwarded to a member of the Board, who may, in their discretion, assume responsibility for evaluating any possible violation and directing or conducting any investigation or may delegate any portion of such responsibility to a committee of the Board or another person or entity. The Board will have the authority to engage independent counsel and other advisers, as it deems necessary, to assist in its investigation and decision process.
After conducting the investigation, the results will be evaluated and the Board will authorize such response, follow-up and preventive actions, if any, as are deemed necessary and appropriate to address the substance of the reported possible violation. We reserve the right to take whatever action it believes appropriate, up to and including discharge of any Covered Executive determined to have engaged in improper conduct.
We will not penalize or retaliate against any person or entity for reporting a possible violation in good faith. We will not tolerate retaliation against any person or entity for submitting, or for cooperating in the investigation of, a possible violation. Any retaliation will warrant disciplinary action against the person who wrongfully retaliates, up to and including termination of employment.
Exhibit 31.1
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Thomas J. Howells, President of Atlantica, Inc. (the "small business issuer"), certify that:
1. I have reviewed this Annual Report ("Annual Report") on Form 10-KSB of the small business issuer;
2. Based on my knowledge, this Annual Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Annual Report;
3. Based on my knowledge, the financial statements, and other financial information included in this Annual Report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this Annual Report;
4. The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this Annual Report is being prepared;
b) evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this Quarterly Report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Annual Report based on such evaluation; and
c) disclosed in this Annual Report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and
5. The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions);
a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.
Dated: 6/24/2005 Signature:/S/Thomas J. Howells
----------------------
Thomas J. Howells
President
|
Exhibit 31.2
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Travis T. Jenson, Secretary of Atlantica, Inc. (the "small business issuer"), certify that:
1. I have reviewed this Annual Report ("Annual Report") on Form 10-KSB of the small business issuer;
2. Based on my knowledge, this Annual Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Annual Report;
3. Based on my knowledge, the financial statements, and other financial information included in this Annual Report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this Annual Report;
4. The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the small business issuer and have:
a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this Annual Report is being prepared;
b) evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this Quarterly Report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Annual Report based on such evaluation; and
c) disclosed in this Annual Report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and
5. The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions);
a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.
Dated: 6/24/2005 Signature:/S/Travis T. Jenson
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Travis T. Jenson
Secretary
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Exhibit 32
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Atlantica, Inc. (the "Company") on Form 10-KSB for the period ending December 31, 2001, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), We, Thomas J. Howells, President and Travis T. Jenson, Secretary of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.
Date: 6/24/2005 /s/Thomas J. Howells
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Thomas J. Howells
President and director
Date: 6/24/2005 /s/Travis T. Jenson
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Travis T. Jenson
Secretary and
director
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Exhibit 99
Atlantica, Inc.
4685 South Highland Drive, #202
Salt Lake City, Utah 84117
Interwest Stock Transfer
1981 E. Murray-Holladay Rd.
Salt Lake City, Utah 84117
Re: Registration Agreement respecting certain shares of common stock of Atlantica, Inc. a Utah corporation (the "Company"), and related instructions to Interwest Stock Transfer ("TA")
Dear Ladies and Gentlemen:
In furtherance of compliance with the Securities Act of 1933, as amended (the "Securities Act"), the General Rules and Regulations promulgated thereunder by the United States Securities and Exchange Commission (the "Commission") and the letter dated January 20, 2000, of Richard K. Wulff, who was the Chief of the Commission's Office of Small Business, that was addressed to Ken Worm, the Assistant Director of the OTC Compliance Unit of NASD (the "Wulff letter"), the undersigned person agrees as follows:
(1) That the following stock certificate and the shares of common stock of the Company represented thereby shall not be publicly sold unless and until: (i) there is a Registration Statement filed with the Commission covering this stock certificate and the shares of common stock represented thereby, which has become effective; or (ii) the Commission provides a "no action" letter which indicates that registration prior to resale of this stock certificate and the shares of common stock represented thereby is not required under Section 5 of the Securities Act as there is an available exemption for the resale of these securities by the undersigned; or (iii) there is a finding by a United States District Court having original jurisdiction or a state court having concurrent jurisdiction regarding the Securities Act, to the effect that this stock certificate and the shares of common stock represented thereby can be resold by the undersigned or successors without registration under the Securities Act.
(2) The undersigned person agrees and does hereby advise Atlantica and TA that they are hereby authorized to place a restriction on the stock certificate referred herein below on its presentation, reflecting the terms and conditions of this Registration Agreement, and that Atlantica and TA shall make appropriate notations in the transfer records maintained for and on behalf of the Company to the effect that the following stock certificate has "stop transfer" instructions until one of the foregoing conditions has been met.
(3) The undersigned shall promptly courier to TA the following stock certificate for the imprinting of an appropriate legend reflecting this Registration Agreement. The stock certificate subject to this Registration Agreement is as follows:
Stock Number of Name and Address Certificate No. Shares
Duane S. Jenson 5034 8,000,000
5044 4,000,000
Travis T. Jenson 5035 4,000,000
Thomas J. Howells 5036 4,000,000
Leonard W. Burningham 5038 3,908,000
Date: 6/27/2005 /s/Duane S. Jenson
Duane S. Jenson
Date: 6/27/2005 /s/Travis T. Jenson
Travis T. Jenson
Date: 6/27/2005 /s/Thomas J. Howells
Thomas J. Howells
Date: 6/27/2005 /s/Leonard W. Burningham
Leonard W. Burningham
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