FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
PERKINS OIL & GAS INC
(Exact name of registrant as specified in its charter)
Nevada
(State or other jurisdiction of incorporation)
45-5361669
(IRS Employer Identification No.)
1445 Marpole Avenue #409
Vancouver, BC V6H 1S5
Telephone (604)733-5055
(Address and telephone number of registrant's principal executive offices)
Sage International
1135 Terminal Way, Suite 209
Reno, NV 89502
Telephone (775)786-5515 Facsimile (775)786-2013
(Name, address and telephone number of agent for service)
With copies to:
Kevin M. Murphy, Attorney at Law
6402 Scott Lane, Pearland, TX 77581
info@kevinmurphylaw.com
Telephone (281)804-1174
Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [X]
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.
Large accelerated filer [ ] Accelerated Filer [ ] Non-accelerated filer [ ] Smaller reporting company [X]
Proposed Proposed
Title of Maximum Maximum
Securities Offering Aggregate Amount of
to be Amount to be Price Per Offering Registration
Registered Registered Share (2) Price (3) Fee (1)
--------------------------------------------------------------------------------
Common Stock 5,000,000 $.01 $50,000 $6.82
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(1) Registration Fee has been paid via Fedwire.
(2) This is the initial offering and no current trading market exists for our
common stock. The price paid for the currently issued and outstanding
common stock was valued at $0.001 per share.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457.
PROSPECTUS
PERKINS OIL & GAS INC
5,000,000 SHARES OF COMMON STOCK AT $.01 PER SHARE
Prior to this registration, there has been no public trading market for the common stock of Perkins Oil & Gas Inc ("Perkins", the "Company", "us", "we", "our") and it is not presently traded on any market or securities exchange. We are offering up to 5,000,000 shares of common stock for sale by us to the public.
We are offering for sale a minimum of 2,000,000 and a maximum of 5,000,000 shares of common stock at a price of $0.01 per share (the "Offering"). The Offering is being conducted on a self-underwritten, best effort basis, which means our officer and director will attempt to sell the shares and we will not be able to spend any of the proceeds unless a minimum of 2,000,000 shares are sold. This Offering will continue for the earlier of: (i) 180 days after this registration statement becomes effective with the Securities and Exchange Commission, or (ii) the date on which all 5,000,000 shares registered hereunder have been sold. We may at our discretion extend the Offering for an additional 90 days. Proceeds from the sale of the shares will be used to fund the initial stages of our business development. There have been no arrangements to place the Offering funds in escrow. We intend to open a standard, non-interest bearing, bank account to be used only for the deposit of funds received from the sale of the shares in this Offering. When at least 2,000,000 shares of the Offering are sold and the Offering has expired the funds will be transferred to our business account for use in the implementation of our business plan. If the minimum number of shares are not sold by the expiration date of the Offering, the funds will be promptly returned to the investors (within 3 business days), without interest or deduction. However; since the funds will not be placed into an escrow account, any third party creditor who may obtain a judgment or lien against us could satisfy the judgment or lien by executing on the bank account where the Offering proceeds are being held, resulting in a loss of any investment you make in our securities.
There can be no assurance that all or any shares being offered in this Prospectus are going to be sold and that we will be able to raise any funds from this Offering.
Shares Offered Price to Selling Agent Proceeds to
by Company Public Commissions the Company
---------- ------ ----------- -----------
Per Share $ 0.01 Not applicable $ 0.01
Minimum (2,000,000 shares) $20,000 Not applicable $20,000
Maximum (5,000,000 shares) $50,000 Not applicable $50,000
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Neither the Securities and Exchange Commission nor any state regulatory authority has approved or disapproved of these securities, endorsed the merits of this Offering, or determined that this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
We are an Emerging Growth Company as defined in the Jumpstart Our Business Startups Act.
AN INVESTMENT IN OUR SECURITIES IS SPECULATIVE. INVESTORS SHOULD BE ABLE TO AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. SEE THE SECTION ENTITLED "RISK FACTORS" BEGINNING ON PAGE 6 OF THIS PROSPECTUS.
This prospectus shall not constitute an offer to sell or the solicitation of an offer to buy these securities and we shall not sell any of these securities in any state where such an offer or solicitation would be unlawful before registration or qualification under such state's securities laws.
You should rely only on the information contained in this Prospectus. We have not authorized anyone to provide you with information different from that contained in this Prospectus.
THE DATE OF THIS PROSPECTUS IS ______________, 2013
TABLE OF CONTENTS
Page No.
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SUMMARY 3
RISK FACTORS 6
RISKS ASSOCIATED WITH OUR COMPANY 6
RISKS RELATING TO THE OIL AND NATURAL GAS INDUSTRY 8
RISKS ASSOCIATED WITH THIS OFFERING 11
USE OF PROCEEDS 14
DETERMINATION OF OFFERING PRICE 15
DILUTION 15
PLAN OF DISTRIBUTION 17
Deposit of Offering Proceeds 18
Procedures for and Requirements for Subscribing 18
DESCRIPTION OF SECURITIES 18
INTEREST OF NAMED EXPERTS AND COUNSEL 19
DESCRIPTION OF BUSINESS 19
General Information 20
Acquisition of the Lease 20
Location, Access, Climate, Local Resources and Infrastructure 20
Markets 23
Competition 24
Distribution Methods 24
Bankruptcy or Similar Proceedings 25
Reorganizations, Purchase or Sale of Assets 25
Source and Availability of Raw Materials 25
Major Customers 25
Patents, Trademarks, Franchises, Royalty Agreements, Labor Contracts 25
Compliance with Government and Environmental Regulation 25
Research and Development 27
Employees and Employment Agreements 27
Reports to Security Holders 27
DESCRIPTION OF PROPERTY 27
LEGAL PROCEEDINGS 28
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 28
WHERE YOU CAN FIND MORE INFORMATION 29
FINANCIAL STATEMENTS 29
PLAN OF OPERATION 29
DIRECTOR, EXECUTIVE OFFICER, PROMOTER AND CONTROL PERSON 33
EXECUTIVE COMPENSATION 34
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNER AND MANAGEMENT 35
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 36
INDEMNIFICATION 36
STOCK TRANSFER AGENT 36
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SUMMARY
This Prospectus, and any supplement to this Prospectus include "forward-looking statements". To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as "intends", "anticipates", "believes", "estimates", "projects", "forecasts", "expects", "plans" and "proposes". Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the "Risk Factors" section beginning on Page 7 of this Prospectus and the "Management's Discussion and Analysis of Financial Position and Results of Operations" section elsewhere in this Prospectus.
This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary may not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including "Risk Factors" beginning on Page 7, and the financial statements, before making an investment decision.
All dollar amounts refer to US dollars unless otherwise indicated.
Unless otherwise noted, All references to "us", "we", "our" relate to Perkins Oil & Gas Inc, a Nevada corporation.
BUSINESS
We are an exploration stage company, incorporated in the State of Nevada on May 25, 2012, as a for-profit company, and electing a fiscal year end of June 30.
We intend to use the net proceeds from this Offering to further develop our business operations. (See "Business of the Company" and "Use of Proceeds".) We are an exploration stage company with limited revenues and operating history. The principal executive offices are located at 1445 Marpole Avenue #409, Vancouver, B.C. V6H 1S5, Canada. The telephone number is (604)733-5055.
We were incorporated to engage in the exploration and development of oil and gas properties. Our first lease is a 25% percent working interest and an 18.75% net revenue interest in 3 acres located in the Perkins Lease in Caddo Pine Island Field that lies in the northern part of Webster Parrish, Louisiana. There is currently one operating oil well on the property. This property is described in "Description of Property" further in this Prospectus.
We received our initial funding of $20,000 through the sale of common stock to our officer, J. Michael Page, who purchased 4,000,000 shares of our common stock at $0.01 per share on June 15, 2012. From inception until the date of this filing we have had limited operating activities. Our financial statements from inception (May 25, 2012) through September 30, 2012 report $2,343 in revenue and a net loss of $15,494. Our independent auditor has issued an audit opinion for Perkins Oil & Gas Inc. which includes a statement expressing substantial doubt as to our ability to continue as a going concern.
There is no current public market for our securities. As our stock is not publicly traded, investors should be aware they probably will be unable to sell their shares and their investment in our securities is not liquid.
OFFERING
We have 4,000,000 shares of common stock issued and outstanding. Through this offering we will register 5,000,000 shares of common stock for offering to the public. These shares represent additional common stock to be issued by us. We will endeavor to sell all 5,000,000 shares of common stock after this registration becomes effective. The price at which we offer these shares is fixed at $0.01 per share for the duration of the offering. We will receive all proceeds from the sale of the common stock unless we are unable to sell the minimum of 2,000,000 shares.
Securities Being Offered A minimum of 2,000,000 and a maximum of 5,000,000
shares of common stock.
Price per Share $0.01
Offering Period The shares are offered for a period not to exceed
180 days, unless extended by our board of
directors for an additional 90 days.
Net Proceeds $20,000 to $50,000
Securities Issued
and Outstanding 4,000,000 shares of common stock were issued and
outstanding as of the date of this prospectus.
Registration costs We estimate our total Offering registration costs
to be $6,506
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You should rely only upon the information contained in this prospectus. We have not authorized anyone to provide you with information different from that which is contained in this prospectus. We are offering to sell shares of common stock and seeking offers to buy shares of common stock only in jurisdictions where offers and sales are permitted.
SUMMARY OF OUR FINANCIAL INFORMATION
The following table sets forth selected financial information, which should be read in conjunction with the information set forth in the "Management's Discussion and Analysis of Financial Position and Results of Operations" section and the accompanying financial statements and related notes included elsewhere in this Prospectus.
STATEMENT OF EXPENSES DATA
Period from
May 25, 2012
(inception) to
September 30, 2012
------------------
Revenues $ 2,343
Total Expenses $ 17,837
Net Loss $ 15,494
Net Loss per share $ 0.00
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BALANCE SHEET DATA
As at
September 30, 2012
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Total Assets $ 15,335
Total Liabilities $ 10,828
Stockholders' Equity $ 4,507
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EMERGING GROWTH COMPANY
We are an Emerging Growth Company as defined in the Jumpstart Our Business Startups Act.
We shall continue to be deemed an emerging growth company until the earliest of:
a. the last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000,000 (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more;
b. the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title;
c. the date on which such issuer has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or
d. the date on which such issuer is deemed to be a `large accelerated filer', as defined in section 240.12b-2 of title 17, Code of Federal Regulations, or any successor thereto.
As an emerging growth company we are exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures.
Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on the effectiveness of the internal control structure and procedures for financial reporting.
As an emerging growth company we are exempt from Section 14A and B of the Securities Exchange Act of 1934 which require the shareholder approval of executive compensation and golden parachutes.
We have irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act.
RISK FACTORS
Please consider the following risk factors and other information in this prospectus relating to our business and prospects before deciding to invest in our common stock.
This Offering and any investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and all of the information contained in this prospectus before deciding whether to purchase our common stock. If any of the following risks actually occur, our business, financial condition and results of operations could be harmed. The trading price of our common stock could decline due to any of these risks, and you may lose all or part of your investment.
We consider the following to be the material risks for an investor regarding this Offering. Our company should be viewed as a high-risk investment and speculative in nature. An investment in our common stock may result in a complete loss of the invested amount. Please consider the following risk factors before deciding to invest in our common stock.
RISKS ASSOCIATED WITH OUR COMPANY
OUR AUDITORS' REPORTS CONTAIN A STATEMENT THAT OUR NET LOSS AND LIMITED WORKING CAPITAL RAISE SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO CONTINUE AS A GOING CONCERN.
Our independent registered public accountants have stated in their report, included in this Prospectus under the heading "Financial Statements" that our significant operating losses and working capital deficiency raise substantial doubt about our ability to continue as a going concern. We had a net loss of $15,494 for the period ended September 30, 2012. We will be required to raise substantial capital to fund our capital expenditures, working capital and other cash requirements since our current cash assets are exhausted. As such we may have to cease activities and you could lose your investment.
WE LACK AN EXTENSIVE OPERATING HISTORY AND HAVE LOSSES WHICH WE EXPECT TO CONTINUE INTO THE FUTURE. AS A RESULT, WE MAY HAVE TO SUSPEND OR CEASE ACTIVITIES.
We were incorporated in May 2012 and we have only recently started our business activities and only realized limited revenues. We have a very limited operating history upon which an evaluation of our future success or failure can be made. Our net loss was $15,494 from inception to September 30, 2012. Our ability to achieve and maintain profitability and positive cash flow is dependent upon:
* our ability to locate additional profitable oil & gas properties
* our ability to generate revenues
* our ability to reduce operating costs
Based upon current plans, we expect to incur operating losses in future periods until revenues are sufficient to fund operations. Failure to generate enough revenues for us to become profitable may cause us to suspend or cease activities.
BECAUSE WE ARE SMALL AND DO NOT HAVE MUCH CAPITAL, WE MAY HAVE TO LIMIT OUR ACQUISITION ACTIVITY WHICH MAY RESULT IN A LOSS OF YOUR INVESTMENT.
Because we are small and do not have much capital, we must limit our acquisition activity. As such we may not be able to lease as many properties as we would like. In that event, a profitable oil or gas reserve may go undiscovered.
Without producing wells we cannot generate revenues and you will lose your investment.
THE OIL AND NATURAL GAS INDUSTRY IS HIGHLY COMPETITIVE AND THERE IS NO ASSURANCE THAT WE WILL BE SUCCESSFUL IN ACQUIRING LEASES.
The oil and natural gas industry is intensely competitive. Although we do not compete with other oil and gas companies for the sale of any oil and gas that we may produce, as there is sufficient demand in the world market for these products, we compete with numerous individuals and companies, including many major oil and natural gas companies which have substantially greater technical, financial and operational resources and staff. Accordingly, there is a high degree of competition for desirable oil and natural gas leases, suitable properties for drilling operations and necessary drilling equipment, as well as for access to funds. We cannot predict if the necessary funds can be raised or that any projected work will be completed.
THERE CAN BE NO ASSURANCE THAT WE WILL DISCOVER OIL OR NATURAL GAS IN ANY
COMMERCIAL QUANTITY ON OUR PROPERTIES.
Exploration for economic reserves of oil and natural gas is subject to a number of risks. There is competition for the acquisition of available oil and natural gas properties. Few properties that are explored are ultimately developed into producing oil and/or natural gas wells. If we cannot discover oil or natural gas in any commercial quantity thereon, our business will fail.
WE WILL BE RELIANT UPON AN OUTSIDE OPERATOR TO MONITOR THE DAY TO DAY OPERATION OF THE WELLS. IF THE OPERATOR FAILS TO CARRY OUT THE TERMS OF OUR AGREEMENT OR WE LOSE THE SERVICES OF THE OPERATOR OUR BUSINESS MAY FAIL.
The re-working of our current well and monthly maintenance of the well once production commences will be carried out by an independent operator. We have an operating agreement in place, however; their failure to live up to the terms of the agreement or a cancellation of the agreement could have an adverse effect on production and future revenues, consequently our operations, earnings and ultimate financial success may suffer irreparable harm as a result.
BECAUSE OUR SOLE OFFICER AND/OR DIRECTOR DOES NOT HAVE ANY FORMAL TRAINING SPECIFIC TO THE OIL AND GAS INDUSTRY, THERE IS A HIGHER RISK OUR BUSINESS WILL FAIL.
Our sole officer and director is J. Michael Page. Mr. Page has no formal training in the oil and gas industry or in the technical aspects of management of an oil and gas company. His prior business experience has primarily been in the computer industry specializing in wireless electronic systems and smart card readers. With no direct training or experience in the oil and gas industry, he may not be fully aware of the specific requirements related to working within this industry. His decisions and choices may not take into account standard business or managerial approaches oil and gas companies commonly use. Consequently, our operations, earnings, and ultimate financial success could suffer irreparable harm due to his lack of experience in this industry.
BECAUSE OUR OFFICER AND DIRECTOR HAS OTHER OUTSIDE BUSINESS ACTIVITIES AND WILL ONLY BE DEVOTING 5 TO 10% OF HIS TIME OR APPROXIMATELY TWO TO FOUR HOURS PER WEEK TO OUR OPERATIONS, OUR OPERATIONS MAY BE SPORADIC WHICH MAY RESULT IN PERIODIC INTERRUPTIONS OR SUSPENSIONS OF EXPLORATION.
Because our officer and director has other outside business activities and will only be devoting 5 to 10% of his time or two to four hours per week to our operations, our operations may be sporadic and occur at times which are convenient to our officer and director. As a result our business plan may be periodically interrupted or suspended.
OUR DIRECTOR WILL CONTINUE TO EXERCISE SIGNIFICANT CONTROL OVER OUR OPERATIONS, WHICH MEANS AS A MINORITY STOCKHOLDER, YOU WOULD HAVE NO CONTROL OVER CERTAIN MATTERS REQUIRING STOCKHOLDER APPROVAL THAT COULD AFFECT YOUR ABILITY TO EVER RESELL ANY SHARES YOU PURCHASE IN THIS OFFERING.
After the completion of this Offering, if all 5,000,000 shares are sold, Mr. Page will own 44.4% of our common stock. He will have significant influence in determining the outcome of all corporate transactions, including the election of directors, approval of significant corporate transactions, changes in control of the company or other matters that could affect your ability to ever resell your shares. His interests may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other stockholders.
OUR SOLE OFFICER AND DIRECTOR LIVES OUTSIDE THE UNITED STATES, MAKING IT DIFFICULT FOR AN INVESTOR TO ENFORCE LIABILITIES IN FOREIGN JURISDICTIONS.
We are a Nevada corporation and, as such, are subject to the jurisdiction of the State of Nevada and the United States courts for purposes of any lawsuit, action or proceeding by investors herein. An investor would have the ability to effect service of process in any action on the company within the United States. However, since our officer and director resides outside the United States, substantially all or a portion of his assets are located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States upon him or to enforce any judgments obtained in United States courts predicated upon the civil liability provisions of the federal securities laws of the United States or any state thereof.
Because our sole officer and director lives in Vancouver, Canada, and our current well is in Webster Parish, Louisiana, there may be a higher risk that our business may fail.
The distance from where our sole officer and director lives and where the well operations are located, may create a detrimental situation due to lack of oversight. Though we have an operating agreement with an independent operator to monitor the well production, there is no assurance that it will be carried out properly without direct oversight by our officer and director. This could have an adverse effect on production and future revenues, consequently our operations, earnings and ultimate financial success may suffer irreparable harm as a result.
RISKS RELATING TO THE OIL AND NATURAL GAS INDUSTRY
THE MARKETABILITY OF NATURAL RESOURCES IS AFFECTED BY NUMEROUS FACTORS BEYOND OUR CONTROL WHICH MAY RESULT IN US NOT RECEIVING AN ADEQUATE RETURN ON INVESTED CAPITAL TO BE PROFITABLE OR VIABLE.
The marketability of natural resources which may be acquired or discovered by us will be affected by numerous factors beyond our control. These factors include market fluctuations in oil and natural gas pricing and demand, the proximity and capacity of natural resource markets and processing equipment, governmental regulations, land tenure, land use, regulation concerning the importing and exporting of oil and natural gas and environmental protection regulations. The
exact effect of these factors cannot be accurately predicted, but the combination of these factors may result in us not receiving an adequate return on invested capital to be profitable or viable.
OIL AND NATURAL GAS OPERATIONS ARE SUBJECT TO COMPREHENSIVE REGULATION WHICH MAY CAUSE SUBSTANTIAL DELAYS OR REQUIRE CAPITAL OUTLAYS IN EXCESS OF THOSE ANTICIPATED CAUSING AN ADVERSE EFFECT ON OUR COMPANY.
Oil and natural gas operations are subject to federal, state, and local laws relating to the protection of the environment, including laws regulating removal of natural resources from the ground and the discharge of materials into the environment. Oil and natural gas operations are also subject to federal, state, and local laws and regulations which seek to maintain health and safety standards by regulating the design and use of drilling methods and equipment. Various permits from government bodies are required for drilling operations to be conducted; no assurance can be given that standards imposed by federal, provincial, or local authorities may be changed and any such changes may have material adverse effects on our activities. Moreover, compliance with such laws may cause substantial delays or require capital outlays in excess of those anticipated, thus causing an adverse effect on us. Additionally, we may be subject to liability for pollution or other environmental damages. To date, we have not been required to spend any material amount on compliance with environmental regulations. However, we may be required to do so in the future and this may affect our ability to expand or maintain our operations.
EXPLORATION AND PRODUCTION ACTIVITIES ARE SUBJECT TO CERTAIN ENVIRONMENTAL REGULATIONS WHICH MAY PREVENT OR DELAY THE COMMENCEMENT OR CONTINUATION OF OUR OPERATIONS.
In general, our exploration and production activities are subject to certain federal, state and local laws and regulations relating to environmental quality and pollution control. Such laws and regulations increase the costs of these activities and may prevent or delay the commencement or continuation of a given operation. Specifically, we may be subject to legislation regarding emissions into the environment, water discharges and storage and disposition of hazardous wastes. In addition, legislation has been enacted which requires well and facility sites to be abandoned and reclaimed to the satisfaction of state authorities. However, such laws and regulations are frequently changed and we are unable to predict the ultimate cost of compliance. Generally, environmental requirements do not appear to affect us any differently or to any greater or lesser extent than other companies in the industry.
ANY CHANGE TO GOVERNMENT REGULATION/ADMINISTRATIVE PRACTICES MAY HAVE A NEGATIVE IMPACT ON OUR ABILITY TO OPERATE AND OUR PROFITABILITY.
The business of oil and natural gas exploration and development is subject to substantial regulation under various countries laws relating to the exploration for, and the development, upgrading, marketing, pricing, taxation, and transportation of oil and natural gas and related products and other matters. Amendments to current laws and regulations governing operations and activities of oil and natural gas exploration and development operations could have a material adverse impact on our business. In addition, there can be no assurance that income tax laws, royalty regulations and government incentive programs related to the properties subject to our farm-out agreements and the oil and natural gas industry generally will not be changed in a manner which may adversely affect our progress and cause delays, inability to explore and develop or abandonment of these interests.
Permits, leases, licenses, and approvals are required from a variety of regulatory authorities at various stages of exploration and development. There can be no assurance that the various government permits, leases, licenses and approvals sought will be granted in respect of our activities or, if granted,
will not be cancelled or will be renewed upon expiry. There is no assurance that such permits, leases, licenses, and approvals will not contain terms and provisions which may adversely affect our exploration and development activities.
IF OUR ASSESSMENT OF OUR LEASED PROPERTY, OR ANY FUTURE LEASED PROPERTIES, IS MATERIALLY INACCURATE, IT COULD HAVE SIGNIFICANT IMPACT ON FUTURE OPERATIONS AND EARNINGS.
The successful acquisition of producing properties requires assessments of many factors, which are inherently inexact and may be inaccurate, including the following:
* the amount of recoverable reserves;
* future oil and natural gas prices;
* estimates of operating costs;
* estimates of future development costs;
* estimates of the costs and timing of plugging and abandonment; and
* potential environmental and other liabilities.
Our assessment will not reveal all existing or potential problems, nor will it permit us to become familiar enough with the properties to assess fully their capabilities and deficiencies.
IF OIL AND NATURAL GAS PRICES DECREASE, WE MAY BE REQUIRED TO TAKE WRITE-DOWNS OF THE CARRYING VALUE OF OUR OIL AND NATURAL GAS PROPERTY, POTENTIALLY NEGATIVELY IMPACTING THE TRADING VALUE OF OUR SECURITIES.
Accounting rules require that we review periodically the carrying value of our oil and natural gas property for possible impairment. Based on specific market factors and circumstances at the time of prospective impairment reviews, and the continuing evaluation of development plans, production data, economics and other factors, we may be required to write down the carrying value of our oil and natural gas property. A write-down could constitute a non-cash charge to earnings. It is likely the cumulative effect of a write-down could also negatively impact the trading price of our securities.
WE MAY INCUR SUBSTANTIAL LOSSES AND BE SUBJECT TO SUBSTANTIAL LIABILITY CLAIMS AS A RESULT OF OUR OIL AND NATURAL GAS OPERATIONS.
We do not currently have insurance for possible risks. Losses and liabilities arising from uninsured events could materially and adversely affect our business, financial condition or results of operations. The oil and natural gas production activities will be subject to all of the operating risks associated with the production of oil and natural gas, including the possibility of:
* environmental hazards, such as uncontrollable flows of oil, natural
gas, brine, well fluids, toxic gas or other pollution into the
environment, including groundwater and shoreline contamination;
* abnormally pressured formations;
* mechanical difficulties;
* fires and explosions;
* personal injuries and death; and
* natural disasters.
Any of these risks could adversely affect our ability to conduct operations or result in substantial losses to our company. We may elect not to obtain insurance if we believe that the cost of available insurance is excessive relative to the risks presented. In addition, pollution and environmental risks generally are not fully insurable. If a significant accident or other event occurs and is not fully covered by insurance, then it could adversely affect us.
WE COULD NOT ACT AS THE "OPERATOR" ON OUR PROPERTY, AND SO WE ARE EXPOSED TO THE RISKS OF OUR THIRD-PARTY OPERATORS.
We will be relying on the expertise of contracted third-party oil and gas exploration and development operators and third-party consultants for their judgment, experience and advice. We can give no assurance that these third party operators or consultants will always act in our best interests, and we are exposed as a third party to their operations and actions and advice in those properties and activities in which we are contractually bound.
UNLESS WE REPLACE OUR OIL AND NATURAL GAS RESERVES, OUR RESERVES AND PRODUCTION WILL DECLINE, WHICH WOULD ADVERSELY AFFECT OUR CASH FLOWS AND INCOME.
Unless we conduct successful development and exploitation activities or acquire properties containing proved reserves, our proved reserves when we find them will decline as those reserves are produced. Producing oil and natural gas reservoirs generally are characterized by declining production rates that vary depending upon reservoir characteristics and other factors. Our future oil and natural gas reserves and production, and, therefore our cash flow and income, are highly dependent on our success in efficiently developing and exploiting our current reserves and economically finding or acquiring additional recoverable reserves. If we are unable to develop, exploit, find or acquire additional reserves to replace our current and future production, our cash flow and income will decline as production declines, until our existing property would be incapable of sustaining commercial production.
IF ACCESS TO MARKETS IS RESTRICTED, IT COULD NEGATIVELY IMPACT OUR PRODUCTION, OUR INCOME AND ULTIMATELY OUR ABILITY TO RETAIN OUR LEASE AND ANY FUTURE LEASES.
Market conditions or the unavailability of satisfactory oil and natural gas gathering arrangements may hinder access to oil and natural gas markets or delay production. The availability of a ready market for our oil and natural gas production depends on a number of factors, including the demand for and supply of oil and natural gas and the proximity of reserves to pipelines and terminal facilities. The ability to market production depends in substantial part on the availability and capacity of gathering systems, pipelines and processing facilities owned and operated by third parties. Our failure to obtain such services on acceptable terms could materially harm our business.
RISKS ASSOCIATED WITH THIS OFFERING
WE WILL INCUR INCREASED COSTS AS A RESULT OF BEING A PUBLICLY-TRADED COMPANY.
As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. In addition, the Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the Securities and Exchange Commission, has required changes in corporate governance practices of public companies. These new rules and regulations have increased our legal and financial compliance costs and have made some activities more time-consuming and costly. As a result of the new rules, it may become more difficult for us to attract and retain qualified persons to serve on our board
of directors or as executive officers. We cannot predict or estimate the amount of additional costs we may incur as a result of being a public company or the timing of such costs and/or whether we will be able to raise the funds necessary to meet the cash requirements for these costs.
WE WILL INCUR ONGOING COSTS AND EXPENSES FOR U.S. SECURITIES AND EXCHANGE COMMISSION REPORTING AND COMPLIANCE. WITHOUT REVENUE WE MAY NOT BE ABLE TO REMAIN IN COMPLIANCE, MAKING IT DIFFICULT FOR INVESTORS TO SELL THEIR SHARES, IF AT ALL.
Our business plan allows for the payment of the estimated costs of this registration statement $6,506 to be paid from existing cash on hand. We plan to contact a market maker immediately following the close of the Offering and apply to have the shares quoted on the Financial Industry Regulatory Authority's (FINRA) Over the Counter Bulletin Board ("OTCBB"). To be eligible for quotation, issuers must remain current in their filings with the U.S. Securities and Exchange Commission. In order for us to remain in compliance we will require future revenues to cover the cost of these filings, which could comprise a substantial portion of our available cash resources. If we are unable to generate sufficient revenues to remain in compliance it may be difficult for you to resell any shares you may purchase, if at all.
IF A MARKET FOR OUR COMMON STOCK DOES NOT DEVELOP, STOCKHOLDERS MAY BE UNABLE TO SELL THEIR SHARES AND WILL INCUR LOSSES AS A RESULT.
There is currently no market for our common stock and no certainty that a market will develop. We currently plan to apply for quotation of our common stock on the OTCBB upon the effectiveness of our Registration Statement on Form S-1, of which this prospectus forms a part. Our shares may never trade on the OTCBB. If no market is ever developed for our shares, it will be difficult for stockholders to sell their stock. In such a case, stockholders may find that they are unable to achieve benefits from their investment.
OUR STOCK IS A PENNY STOCK. TRADING OF OUR STOCK MAY BE RESTRICTED BY THE SECURITIES AND EXCHANGE COMMISSION'S PENNY STOCK REGULATIONS WHICH MAY LIMIT A STOCKHOLDER'S ABILITY TO BUY AND SELL OUR STOCK.
Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements
may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.
FINRA SALES PRACTICE REQUIREMENTS MAY ALSO LIMIT A STOCKHOLDER'S ABILITY TO BUY AND SELL OUR STOCK.
In addition to the "penny stock" rules promulgated by the Securities and Exchange Commission, FINRA has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, the FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock.
OUR SECURITY HOLDERS MAY FACE SIGNIFICANT RESTRICTIONS ON THE RESALE OF OUR SECURITIES DUE TO STATE "BLUE SKY" LAWS.
Each state has its own securities laws, often called "blue sky" laws, which (i) limit sales of securities to a state's residents unless the securities are registered in that state or qualify for an exemption from registration, and (ii) govern the reporting requirements for broker-dealers doing business directly or indirectly in the state. Before a security is sold in a state, there must be a registration in place to cover the transaction, or the transaction must be exempt from registration. The applicable broker must be registered in that state.
We do not know whether our securities will be registered or exempt from registration under the laws of any state. A determination regarding registration will be made by those broker-dealers, if any, who agree to serve as the market-makers for our common stock. There may be significant state blue sky law restrictions on the ability of investors to sell, and on purchasers to buy, our securities. You should therefore consider the resale market for our common stock to be limited, as you may be unable to resell your shares without the significant expense of state registration or qualification.
WE ARE SELLING THIS OFFERING WITHOUT AN UNDERWRITER AND MAY BE UNABLE TO SELL ANY SHARES.
This Offering is self-underwritten, that is, we are not going to engage the services of an underwriter to sell the shares; we intend to sell them through our officer and director, who will receive no commissions. He will offer the shares to friends, relatives and business associates, however; there is no guarantee that he will be able to sell any of the shares. Unless he is successful in selling all of the shares and we receive the proceeds from this Offering, we may have to seek alternative financing to implement our business plans.
YOU WILL INCUR IMMEDIATE AND SUBSTANTIAL DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES.
Our existing stockholder acquired his shares at a cost of $.005 per share, a cost per share substantially less than that which you will pay for the shares you purchase in this Offering. Upon completion of this Offering, if all 5,000,000 shares are sold, the net tangible book value of the shares held by our existing stockholder (4,000,000 shares) will be increased by $.005 per share without any additional investment on his part. The purchasers of shares in this Offering will incur immediate dilution (a reduction in the net tangible book
value per share from the Offering price of $.01 per share) of $.004 per share. As a result, after completion of the Offering, the net tangible book value of the shares held by purchasers in this Offering would be $.006 per share, reflecting an immediate reduction in the $.01 price per share they paid for their shares.
WE WILL BE HOLDING ALL THE PROCEEDS FROM THE OFFERING IN A STANDARD BANK CHECKING ACCOUNT UNTIL THE 5,000,000 SHARES ARE SOLD AND THE OFFERING IS CLOSED OR THE MINIMUM OF 2,000,000 SHARES ARE SOLD AND THE OFFERING EXPIRES. BECAUSE THE SHARES ARE NOT HELD IN AN ESCROW OR TRUST ACCOUNT THERE IS A RISK YOUR MONEY WILL NOT BE RETURNED IF ALL THE SHARES ARE NOT SOLD.
All funds received from the sale of shares in this Offering will be deposited into a standard bank checking account until all 5,000,000 shares are sold and the Offering is closed or the minimum of 2,000,000 shares are sold and the Offering expires. At that time, the proceeds will be transferred to our business operating account. In the event the minimum of 2,000,000 shares are not sold and the Offering expires we have committed to promptly return all funds to the purchasers. However; since the funds will not be placed into an escrow, trust or other similar account, any third party creditor who may obtain a judgment or lien against us could satisfy the judgment or lien by executing on the bank account where the Offering proceeds are being held, resulting in a loss of any investment you make in our securities.
OUR SOLE OFFICER AND DIRECTOR, BENEFICIALLY OWNS 100% OF THE OUTSTANDING SHARES OF OUR COMMON STOCK. AFTER THE COMPLETION OF THIS OFFERING HE WILL OWN 44.4% OF THE OUTSTANDING SHARES. IF HE CHOOSES TO SELL HIS SHARES IN THE FUTURE, IT MIGHT HAVE AN ADVERSE EFFECT ON THE PRICE OF OUR STOCK.
Due to the amount of Mr. Page's share ownership in our company, if he chooses to sell his shares in the public market, the market price of our stock could decrease and all stockholders suffer a dilution of the value of their stock.
STOCKHOLDERS MAY HAVE LIMITED ACCESS TO INFORMATION BECAUSE WE ARE NOT A
REPORTING ISSUER AND MAY NOT BECOME ONE. We are not currently a reporting issuer
and upon this registration statement becoming effective we will be required to
comply only with the limited reporting obligations required by Section 13(a) of
the Exchange Act. These reporting obligations may be automatically suspended
under Section 15(d) of the Exchange Act if on the first day of any fiscal year
other than the fiscal year in which our registration statement became effective,
there are fewer than 300 shareholders. If we do not become a reporting issuer
and instead make a decision to suspend our public reporting, we will no longer
be obligated to file periodic reports with SEC, and your access to our business
information will be restricted. In addition, if we do not become a reporting
issuer, we will not be required to furnish proxy statements to security holders,
and our directors, officers and principal beneficial owners will not be required
to report their beneficial ownership of securities to the SEC pursuant to
Section 16 of the Exchange Act.
USE OF PROCEEDS
Assuming sale of all of the shares offered herein, of which there is no assurance, the net proceeds from this Offering will be $50,000. The proceeds are expected to be disbursed, in the priority set forth below, during the first twelve (12) months after the successful completion of the Offering:
100% 70% 40%
-------- -------- --------
Total Proceeds to the Company $ 50,000 $ 35,000 $ 20,000
Lease of additional Oil & Gas Property $ 17,500 $ 0 $ 0
Monthly maintenance (12 months @ $642 ea well) $ 15,408 $ 7,704 $ 7,704
Administration and General Expense $ 5,000 $ 5,000 $ 2,000
Legal and Accounting $ 10,000 $ 10,000 $ 10,000
Working Capital $ 2,092 $ 12,296 $ 296
-------- -------- --------
Total Use of Net Proceeds $ 50,000 $ 35,000 $ 20,000
======== ======== ========
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We will establish a separate bank account and all proceeds will be deposited into that account until the total amount of the Offering is received and all shares are sold, or the minimum of 2,000,000 shares are sold and the Offering expires, at which time the funds will be released to us for use in our operations. In the event we do not sell the minimum number of shares before the expiration date of the Offering, all funds will be returned promptly to the subscribers, without interest or deduction. If it becomes necessary our director has verbally agreed to loan the company funds to complete the registration process, but we will require full funding to implement our business plan.
If we are only able to sell 40% of the securities we are offering, substantially all of the funds raised by this Offering will be spent on the monthly maintenance of the well and assuring that we meet our corporate and disclosure obligations so that we remain in good standing with the State of Nevada and maintain our status as a reporting issuer with the SEC.
DETERMINATION OF OFFERING PRICE
The offering price for the shares in this Offering was completely arbitrarily. In determining the initial public offering price of the shares we considered several factors including the following:
* our start up status;
* our new business structure and operations as well as lack of client
base;
* prevailing market conditions, including the history and prospects for
our industry;
* our future prospects and the experience of our management;
* our capital structure.
Therefore, the public offering price of the shares does not necessarily bear any relationship to established valuation criteria and may not be indicative of prices that may prevail at any time or from time to time in the public market for the common stock. You cannot be sure that a public market for any of our securities will develop and continue or that the securities will ever trade at a price at or higher than the offering price in this Offering.
DILUTION
Dilution represents the difference between the offering price and the net tangible book value per share immediately after completion of this offering. Net tangible book value is the amount that results from subtracting total liabilities and intangible assets from total assets. Dilution arises mainly as a result of our arbitrary determination of the offering price of the shares being
offered. Dilution of the value of the shares you purchase is also a result of the lower book value of the shares held by our existing stockholders.
As of September 30, 2012, the net tangible book value of our shares was $4,507 or approximately $.001 per share, based upon 4,000,000 shares outstanding.
Upon 100% completion of this Offering, but without taking into account any change in the net tangible book value after completion of this Offering other than that resulting from the sale of all the shares and receipt of the total proceeds of $50,000, the net tangible book value of the 9,000,000 shares to be outstanding will be $54,507, or approximately $.0061 per Share. Accordingly, the net tangible book value of the shares held by our existing stockholder (4,000,000 shares) will be increased by $.005 per share without any additional investment on his part. The purchasers of shares in this Offering will incur immediate dilution (a reduction in the net tangible book value per share from the offering price of $.01 per Share) of $.004 per share. As a result, after completion of the Offering, the net tangible book value of the shares held by purchasers in this Offering would be $.006 per share, reflecting an immediate reduction in the $.01 price per share they paid for their shares.
After 100% completion of the Offering, the existing stockholder will own 45% of the total number of shares then outstanding, for which he will have made a cash investment of $20,000, or $.005 per Share. Upon completion of the Offering, the purchasers of the shares offered hereby will own 55% of the total number of shares then outstanding, for which they will have made a cash investment of $50,000, or $.01 per share.
The following table illustrates the per share dilution to the new investors in the event only a percentage of the shares are sold, and if all the shares are sold, and does not give any effect to the results of any operations subsequent to September 30, 2012:
Percentage of Offering 40% 70% 100% ---------------------- ----------- ----------- ----------- Proceeds to the Company $ 20,000 $ 35,000 $ 50,000 Number of Shares 2,000,000 3,500,000 5,000,000 Price Paid per Share by Existing Stockholder $ .005 $ .005 $ .005 Public Offering Price per Share $ .01 $ .01 $ .01 Net Tangible Book Value Prior to this Offering $ .001 $ .001 $ .001 Net Tangible Book Value After this Offering $ .004 $ .005 $ .006 Increase in Net Tangible Book Value per Share Attributable to cash payments from purchasers of the shares offered $ .003 $ .004 $ .005 Immediate Dilution per Share to New Investors $ .004 $ .005 $ .006 |
The following table summarizes the number and percentage of shares purchased, the amount and percentage of consideration paid and the average price per Share paid by our existing stockholder and by new investors in this offering if all 5,000,000 shares are sold:
Total
Price Number of Percent of Consideration
Per Share Shares Held Ownership Paid
--------- ----------- --------- ----
Existing
Stockholder $ .005 4,000,000 45% $20,000
Investors in
This Offering $ .01 5,000,000 55% $50,000
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PLAN OF DISTRIBUTION
We are offering the shares on a "self-underwritten" basis directly through J. Michael Page, our officer. Mr. Page will not receive any commissions or other remuneration of any kind in connection with his participation in this Offering based either directly or indirectly on transactions in securities.
This Offering is a self-underwritten offering, which means that it does not involve the participation of an underwriter to market, distribute or sell the shares offered under this prospectus. This offering will terminate upon the earlier to occur of (i) 180 days after this registration statement becomes effective with the Securities and Exchange Commission, (ii) the date on which all 5,000,000 shares registered hereunder have been sold. We may, at our discretion, extend the offering for an additional 90 days.
When at least 2,000,000 shares of the Offering are sold and the Offering has expired the funds will be transferred to our business account for use in the implementation of our business plan. If the minimum number of shares are not sold by the expiration date of the Offering, the funds will be promptly returned to the investors (within 3 business days), without interest or deduction.
Mr. Page will not register as a broker-dealer pursuant to Section 15 of the Securities Exchange Act of 1934, in reliance upon Rule 3a4-1, which sets forth those conditions under which a person associated with an issuer may participate in the offering of the issuer's securities and not be deemed to be a broker-dealer.
1. Mr. Page is not subject to a statutory disqualification, as that term
is defined in Section 3(a)(39) of the Act, at the time of his
participation;
2. Mr. Page will not be compensated in connection with his participation
by the payment of commissions or other remuneration based either
directly or indirectly on transactions in securities;
3. Mr. Page is not, nor will he be at the time of participation in the
Offering, an associated person of a broker-dealer; and
4. Mr. Page meets the conditions of paragraph (a)(4)(ii) of Rule 3a4-1 of
the Exchange Act, in that he (A) primarily performs, or is intended
primarily to perform at the end of the Offering, substantial duties
for or on behalf of our company, other than in connection with
transactions in securities; and (B) is not a broker or dealer, or been
an associated person of a broker or dealer, within the preceding
twelve months; and (C) have not participated in selling and offering
securities for any issuer more than once every twelve months other
than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).
Mr. Page does not intend to purchase any shares in this Offering.
If applicable, the shares may not be offered or sold in certain jurisdictions unless they are registered or otherwise comply with the applicable securities laws of such jurisdictions by exemption, qualification or otherwise. We intend to sell the shares only in the states in which this offering has been qualified or an exemption from the registration requirements is available, and purchases of shares may be made only in those states.
In addition and without limiting the foregoing, we will be subject to applicable provisions, rules and regulations under the Exchange Act with regard to security transactions during the period of time when this Registration Statement is effective.
We will not use public solicitation or general advertising in connection with the Offering. This Offering will continue for the longer of: (i) 90 days after this registration statement becomes effective with the Securities and Exchange Commission, or (ii) the date on which all 5,000,000 shares registered hereunder have been sold. We may at our discretion extend the offering for an additional 90 days.
DEPOSIT OF OFFERING PROCEEDS
We are offering for sale a minimum of 2,000,000 and a maximum of 5,000,000 shares of common stock at a price of $0.01 per share. We will not be able to spend any of the proceeds unless the minimum number of shares is sold and the Offering expires. We intend to hold all funds collected in a standard bank account until the total amount of $50,000 has been received and the Offering is closed or the minimum shares are sold and the Offering expires. At that time, the funds will be transferred to our business account for use in the implementation of our business plan. In the event the minimum numbers of shares are not sold out prior to the Expiration Date, all money will be promptly returned to the investors, without interest or deduction within 3 business days. We determined the use of the standard bank account was the most efficient use of our current limited funds. Please see the risk factor section to read the related risk to you as a purchaser of any shares.
PROCEDURES AND REQUIREMENTS FOR SUBSCRIPTION
If you decide to subscribe for any shares in this Offering, you will be required to execute a Subscription Agreement and tender it, together with a check, bank draft or cashier's check payable to the company. Subscriptions, once received by the company, are irrevocable. All checks for subscriptions should be made payable to Perkins Oil & Gas Inc.
DESCRIPTION OF SECURITIES
COMMON STOCK
The authorized capital stock of the Company consists of 75,000,000 shares of Common Stock, par value $.001. The holders of common stock currently (i) have equal ratable rights to dividends from funds legally available therefore, when, as and if declared by the Board of Directors of the Company; (ii) are entitled to share ratably in all of the assets of the Company available for distribution to holders of common stock upon liquidation, dissolution or winding up of the affairs of the Company; (iii) do not have preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights applicable thereto; and (iv) are entitled to one non-cumulative vote per share on all matters on which stockholders may vote. All shares of common stock now
outstanding are fully paid for and non-assessable and all shares of common stock which are the subject of this Offering, when issued, will be fully paid for and non-assessable. Please refer to the Company's Articles of Incorporation, Bylaws and the applicable statutes of the State of Nevada for a more complete description of the rights and liabilities of holders of the Company's securities.
NON-CUMULATIVE VOTING
The holders of shares of common stock of the Company do not have cumulative
voting rights, which means that the holders of more than 50% of such outstanding
shares, voting for the election of directors, can elect all of the directors to
be elected, if they so choose, and, in such event, the holders of the remaining
shares will not be able to elect any of the Company's directors. After this
Offering is completed, and all 5,000,000 shares are sold, the present
stockholder will own 45% of the outstanding shares.
(See "Principal Stockholders".)
CASH DIVIDENDS
As of the date of this prospectus, the Company has not declared or paid any cash dividends to stockholders. The declaration or payment of any future cash dividend will be at the discretion of the Board of Directors and will depend upon the earnings, if any, capital requirements and financial position of the Company, general economic conditions, and other pertinent factors. It is the present intention of the Company not to declare or pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in the Company's business operations.
INTEREST OF NAMED EXPERTS AND COUNSEL
No expert or counsel named in this Prospectus as having prepared or certified any part thereof or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of our common stock was employed on a contingency basis or had or is to receive, in connection with the offering, a substantial interest, directly or indirectly, in us. Additionally, no such expert or counsel was connected with us as a promoter, managing or principal underwriter, voting trustee, director, officer or employee.
Kevin M. Murphy, Attorney at Law has passed upon certain legal matters in connection with the validity of the issuance of the shares of our common stock.
PLS, CPA has audited our Financial Statements for the period from May 25, 2012 (date of inception) through June 30, 2012 and to the extent set forth in its report, which are included herein in reliance upon the authority of said firm as experts in accounting and auditing. There were no disagreements related to accounting principles or practices, financial statement disclosure, internal controls or auditing scope or procedure from date of appointment as our independent registered accountant through the period of audit (inception date May 25, 2012 through June 30, 2012).
DESCRIPTION OF BUSINESS
We are an exploration stage company with limited revenues and operating history. Our independent auditor has issued an audit opinion which includes a statement expressing substantial doubt as to our ability to continue as a going concern.
We currently own a 25% working interest and an 18.75% net revenue interest in a lease of three acres located in Webster Parrish, Louisiana, known as the Perkins Lease. There is currently one producing oil well on the property.
Our focus for the current fiscal year will be on further developing our existing property, while continuing to pursue acquisition of additional leases and/or existing oil and gas wells which have potential for production, if revenues warrant.
GENERAL INFORMATION ABOUT OUR CURRENT LEASE
ACQUISITION OF THE LEASE
On July 9, 2012 the Company signed an assignment agreement with Lanza Land Management LLC which transferred a 25% working interest and a 18.75% net revenue interest in three acres located in Webster Parrish, Louisiana, known as the Perkins Lease, covering and affecting the property described as: Begin at the point where the North line of the Porterville-Sikes Ferry Road intersects the West line of the West Half of the Southeast Quarter of the Northeast Quarter (W/2 of SE/4 of NE/4), Section 36, Township 23 North, Range 11 West, thence run in an easterly direction along the North line of said road 190 feet, thence run North 380 feet, thence run West 285 feet to the West line of said W/2 of SE/4, thence run South 345 feet to the point of beginning, Webster Parish, Louisiana. The well coordinates are 32(Degree) 56' 43.779 N, 93(Degree) 26' 58.969 W, elevation 79 meters. The consideration for the assignment was $17,500. The well on the property was functioning until a lightning strike in June 2012; the pump has been repaired and is currently producing approximately 85 barrels of oil per month.
REQUIREMENTS OR CONDITIONS FOR RETENTION OF LEASE
The lease on the property is for a period of TWO (2) years (called "primary term") and as long thereafter as (1) oil, gas, sulphur or other mineral is produced or (2) is maintained in force in any other manner provided within the lease. The lease is from October 20, 2011 until October 20, 2013 and is effective May 31, 2012.
LOCATION, ACCESS, CLIMATE, LOCAL RESOURCES & INFRASTRUCTURE
General Area: Webster Parish is located in the northwest corner of the state of Louisiana. The parish has a total area of 615 square miles (1,593 km(2)), of which, 595 square miles (1,542 km(2)) of it is land and 20 square miles (51 km(2)) of it (3.23%) is water.
[MAP SHOWING WEBSTER PARIS IN LOUISIANA]
Property Location: The property is described as: Begin at the point where the North line of the Porterville-Sikes Ferry Road intersects the West line of the West Half of the Southeast Quarter of the Northeast Quarter (W/2 of SE/4 of NE/4), Section 36, Township 23 North, Range 11 West, thence run in an easterly direction along the North line of said road 190 feet, thence run North 380 feet, thence run West 285 feet to the West line of said W/2 of SE/4, thence run South 345 feet to the point of beginning, Webster Parish, Louisiana. The well coordinates are 32(Degree) 56' 43.779 N, 93(Degree) 26' 58.969 W, elevation 79 meters.
On the following map the location is noted as "Bronco Resources, Perkins No. 1".
[PLAT MAP SHOWING THE PROPERTY LOCATION]
Access: The property is easily accessible from Route 371 and Porterville-Sikes Ferry Road.
Climate: The area has a humid subtropical climate. Rainfall is abundant, with the normal annual precipitation averaging 52 inches, with monthly averages ranging from less than 3 inches in August to more than 5 inches in May. Severe thunderstorms with heavy rain, hail, damaging winds and tornadoes occur in the area during the spring and summer months. The winter months are normally mild, with an average low of 34 degrees. Summer months are hot and humid, with average temperatures of 93 degrees with high to very high relative average humidity, sometimes exceeding the 90 percent level. On average there are 217 sunny days per year in Webster Parish.
Local Resources & Infrastructure: The Town of Minden, LA located 25 miles from the property, offers some of the necessary infrastructure required for oil & gas exploration and drilling, (limited accommodations, communications, some equipment and supplies). The independent operator, Four Star Oil, who will carry out monthly maintenance on the well, is located in Oil City. Larger or specialized equipment can be acquired in the City of Shreveport, lying 60 miles to the south.
History: In 1906, the Caddo-Pine Island Field in northern Caddo Parish, Louisiana was discovered, and a rush of leasing and drilling activity ensued. In 1908, the first natural gas pipeline was constructed to transport gas from Caddo-Pine Island to Shreveport, Louisiana. This was one of the earliest commercial uses of natural gas, which was commonly viewed as an undesirable by-product of oil production and often "flared" or burnt off at the well site.
Other innovations in the Caddo-Pine Island Field included the first over-water oil platform, which was constructed in the field on Caddo Lake in 1910. In that same year, a major oil pipeline was constructed from Caddo-Pine Island Field to a refinery built and operated by Standard Oil Company of Louisiana in Baton Rouge, Louisiana. The refinery continues to operate today.
The Caddo-Pine Island field is located approximately 15 miles north of the City of Shreveport in Caddo Parish, La., and Marion County, Tex., which covers a portion of the Ark-La-Tex Area. The discovery well in the Caddo-Pine Island field was the Savage Bros. & Morrical No.1 Offenhauser, which was completed March 28, 1905, in the Annona Chalk at a depth of 1,556 ft. The well was located near Oil City, La. By the close of 1907 23 wells had been drilled -eight of which produced oil, 11 produced gas, and four were abandoned. Development of the field continued at a rapid pace during the following years, and by 1918 the production reached a peak of 11 million bbl/year.
Geological Setting: The Caddo Pine Island Field sits on top of the Subine uplift, which is the stratigraphic uplift in Northern Louisiana. Due to the uplift many of the formations on the top of it became excellent reservoir rock for hydrocarbons. Impervious formations lying just above these called caprock cause traps that the oil and gas accumulate up against under pressure. When these caprock formations are drilled through and into the reservoir rock the pressure is then released and will flow to the surface carrying oil and gas with it. Production has been obtained from several horizons, ranging in depth from the Nacatoch sand at 800 ft to the Hosston or Travis Peak which is found at 2,500 ft near the crest of the dome of the Lower Cretaceous beds.
MARKETS
The availability of a ready market and the prices obtained for produced oil depends on many factors, including the extent of domestic production and imports of oil, the proximity and capacity of pipelines and other transportation facilities, fluctuating demand, the marketing of competitive fuels, and the effects of governmental regulation on production and sales. A ready domestic market for oil exists because of the presence of pipelines for transport. The existence of an international market exists depends upon the presence of international delivery systems and political and pricing factors.
If we are successful in the continuing production of oil on our current property and possible additional property, the target customers for our oil are expected to be refiners, remarketers and third party intermediaries, who either have, or have access to, consumer delivery systems. We intend to sell our oil under both short-term (less than one year) and long-term (one year or more) agreements at prices negotiated with third parties. Typically either the entire contract (in
the case of short-term contracts) or the price provisions of the contract (in the case of long-term contracts) are renegotiated at intervals ranging in frequency from daily to annually.
We have not yet adopted any specific sales and marketing plans. However, as we purchase future properties, the need to hire marketing personnel will be addressed.
COMPETITION
We operate in a highly competitive environment for acquiring properties, modernizing existing wells and marketing oil that is produced. The majority of our competitors possess and employ financial, technical and personnel resources substantially greater than ours, which can be particularly important in the areas in which we plan to operate. Those companies may be able to pay more for productive properties and exploratory prospects and to evaluate, bid for and purchase a greater number of properties and prospects than our financial resources permit. Our ability to acquire additional prospects and to find and develop reserves in the future will depend on our ability to evaluate and select suitable properties and to consummate transactions in a highly competitive environment. Also, there is substantial competition for capital available for investment in the oil and natural gas industry.
Current competitive factors in the domestic oil and gas industry are unique. The actual price range of crude oil is largely established by major international producers. Pricing for natural gas is more regional; however, more favorable prices can usually be negotiated for larger quantities of oil and/or gas product. In this respect, while we believe we have a price disadvantage when compared to larger producers, we view our primary pricing risk to be related to a potential decline in international prices to a level which could render our production uneconomical.
We will be committed to use the services of the existing gathering companies in our present area of production. This potentially gives such gathering companies certain short-term relative monopolistic powers to set gathering and transportation costs, because obtaining the services of an alternative gathering company may require substantial additional costs.
General competitive conditions may be substantially affected by various forms of energy legislation and/or regulation introduced from time to time by the governments of the United States and other countries, as well as factors beyond our control, including international political conditions, overall levels of supply and demand for oil and gas, and the markets for synthetic fuels and alternative energy sources.
In the face of competition, we may not be successful in acquiring, exploring or developing profitable oil and gas properties or interests, and we cannot give any assurance that suitable properties or interests will be available for our acquisition, exploration or development. Despite this, we hope to compete successfully in the industry by:
* keeping our costs low;
* relying on the strength of our management's contacts; and
* using our size and experience to our advantage by adapting quickly to
changing market conditions or responding swiftly to potential
opportunities.
DISTRIBUTION METHODS
The oil that we produce is distributed through oil gathering companies. The contract operator, Four Star Oil, will make the arrangements with the gathering companies.
BANKRUPTCY OR SIMILAR PROCEEDINGS
There has been no bankruptcy, receivership or similar proceeding.
REORGANIZATIONS, PURCHASE OR SALE OF ASSETS
There have been no material reclassifications, mergers, consolidations, or purchase or sale of a significant amount of assets not in the ordinary course of business.
SOURCE AND AVAILABILITY OF RAW MATERIALS
We have no significant raw materials. However, if we are successful in our plan of operations we may make use of numerous oil field service companies. We currently only have one well lease in Webster Parrish, Louisiana, where there are numerous oil field service companies.
MAJOR CUSTOMERS
We will principally sell our oil through our operator to marketers and other purchasers that have access to nearby pipeline facilities. Generally, in areas where there is no practical access to pipelines, oil is trucked to storage facilities. We believe that the loss of any of these oil purchasers would not materially impact our business, because we could readily find other purchasers for our oil as produced.
PATENTS, TRADEMARKS, FRANCHISES, ROYALTY AGREEMENTS OR LABOR CONTRACTS
We have no patents, trademarks, licenses, concessions, or labor contracts.
COMPLIANCE WITH GOVERNMENT AND ENVIRONMENTAL REGULATION
REGULATION OF TRANSPORTATION OF OIL
The sales of crude oil are not currently regulated and are made at negotiated prices. Nevertheless, Congress could reenact price controls in the future.
Our sales of crude oil will be affected by the availability, terms and cost of transportation. The transportation of oil in common carrier pipelines is also subject to rate regulation. The Federal Energy Regulatory Commission, or the FERC, regulates interstate oil pipeline transportation rates under the Interstate Commerce Act. Intrastate oil pipeline transportation rates are subject to regulation by state regulatory commissions. The basis for intrastate oil pipeline regulation, and the degree of regulatory oversight and scrutiny given to intrastate oil pipeline rates, varies from state to state.
Insofar as effective interstate and intrastate rates are equally applicable to all comparable shippers, we believe that the regulation of oil transportation rates will not affect our operations in any way that is of material difference from those of our competitors. Further, interstate and intrastate common carrier oil pipelines must provide service on a non-discriminatory basis. Under this open access standard, common carriers must offer service to all shippers requesting service on the same terms and under the same rates. When oil pipelines operate at full capacity, access is governed by pro-rationing provisions set forth in the pipelines' published tariffs. Accordingly, we believe that access to oil pipeline transportation services generally will be available to us to the same extent as to our competitors.
REGULATION OF PRODUCTION
The production of oil is subject to regulation under a wide range of local, state and federal statutes, rules, orders and regulations. Federal, state and local statutes and regulations require permits for drilling operations, drilling bonds and reports concerning operations. All states, in which we may operate in the future, have regulations governing conservation matters, including provisions for the unitization or pooling of oil properties, the establishment of maximum allowable rates of production from oil wells, the regulation of well spacing, and plugging and abandonment of wells. The effect of these regulations is to limit the amount of oil that can be produced from wells and to limit the number of wells or the locations, although companies can apply for exceptions to such regulations or to have reductions in well spacing. Moreover, each state generally imposes a production or severance tax with respect to the production and sale of oil within its jurisdiction.
The failure to comply with these rules and regulations can result in substantial penalties. Our competitors in the oil industry are subject to the same regulatory requirements and restrictions that affect our operations.
ENVIRONMENTAL REGULATION
Oil exploration, development and production operations are subject to stringent federal, state and local laws and regulations governing the discharge of materials into the environment or otherwise relating to environmental protection. Historically, most of the environmental regulation of oil production has been left to state regulatory boards or agencies in those jurisdictions where there is significant oil production, with limited direct regulation by such federal agencies as the Environmental Protection Agency. However, while we believe this generally to be the case for our production activities in Louisiana, there are various regulations issued by the Environmental Protection Agency ("EPA") and other governmental agencies that would govern significant spills, blow-outs, or uncontrolled emissions.
In Louisiana, specific oil regulations apply to the drilling, completion and operations of wells, and the disposal of waste oil and salt water. There are also procedures incident to the plugging and abandonment of dry holes or other non-operational wells, all as governed by the applicable governing state agency.
At the federal level, among the more significant laws and regulations that may affect our business and the oil and gas industry are: The Comprehensive Environmental Response, Compensation and Liability Act of 1980, also known as "CERCLA" or Superfund; the Oil Pollution Act of 1990; the Resource Conservation and Recovery Act, also known as "RCRA"; the Clean Air Act; Federal Water Pollution Control Act of 1972, or the Clean Water Act; and the Safe Drinking Water Act of 1974.
Compliance with these regulations may constitute a significant cost and effort for us. No specific accounting for environmental compliance has been projected by us at this time. We are not presently aware of any environmental demands, claims, or adverse actions, litigation or administrative proceedings in which our acquired property is involved or subject to, or arising out of any predecessor operations.
In the event of a breach of environmental regulations, these environmental regulatory agencies have a broad range of alternative or cumulative remedies which include: ordering a clean-up of any spills or waste material and restoration of the soil or water to conditions existing prior to the environmental violation; fines; or enjoining further drilling, completion or production activities. In certain egregious situations the agencies may also pursue criminal remedies against us or our principal officers.
RESEARCH AND DEVELOPMENT
Since our inception to the date of this Prospectus, we have not spent any money on research and development activities. We paid $17,500 for the lease on the Perkins property.
EMPLOYEES AND EMPLOYMENT AGREEMENTS
Our only employee is our sole officer, J Michael Page. Mr. Page currently devotes 2-4 hours per week to company matters and after receiving funding he plans to devote as much time as the board of directors determines is necessary to manage the affairs of the company. There are no formal employment agreements between the company and our current employee.
REPORTS TO SECURITY HOLDERS
Any member of the public may read and copy any materials filed by us with the Securities and Exchange Commission at the Securities and Exchange Commission's Public Reference Room at 100 F Street, N.E. Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling the Securities and Exchange Commission at 1-800-732-0330. The Securities and Exchange Commission maintains an internet website (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the Securities and Exchange Commission.
DESCRIPTION OF PROPERTY
We do not currently own any property. The Company utilizes space at the home of our officer and director at 1445 Marpole Avenue #409, Vancouver, BC. The telephone number is (604)733-5055. The office space is provided at no charge to the Company. Management believes the current premises are sufficient for its needs at this time.
We currently have no investment policies as they pertain to real estate, real estate interests or real estate mortgages.
DESCRIPTION OF PERKINS LEASE
In June 2012 the company paid $17,500 for 25% working interest and an 18.75% net revenue interest in the Perkins Lease in Caddo Pine Island Field that lies in the northern part of Webster Parish, Louisiana. The lease shall be for a period of TWO (2) years (called "primary term") and as long thereafter as (1) oil, gas, sulphur or other mineral is produced or (2) is maintained in force in any other manner provided within the lease. The lease is from October 20, 2011 until October 20, 2013 and is effective May 31, 2012. The property is legally described as: Begin at the point where the North line of the Porterville-Sikes Ferry Road intersects the West line of the West Half of the Southeast Quarter of the Northeast Quarter (W/2 of SE/4 of NE/4), Section 36, Township 23 North, Range 11 West, thence run in an easterly direction along the North line of said road 190 feet, thence run North 380 feet, thence run West 285 feet to the West line of said W/2 of SE/4, thence run South 345 feet to the point of beginning, Webster Parish, Louisiana.
LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which our director, officer, or affiliate, or any registered beneficial shareholder are an adverse party or has a material interest adverse to us.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
Our common stock is not traded on any exchange. We intend to apply to have our common stock quoted on the OTC Bulletin Board once this Prospectus has been declared effective by the SEC; however, there is no guarantee that we will obtain a listing.
There is currently no trading market for our common stock and there is no assurance that a regular trading market will ever develop. OTC Bulletin Board securities are not listed and traded on the floor of an organized national or regional stock exchange. Instead, OTC Bulletin Board securities transactions are conducted through a telephone and computer network connecting dealers. OTC Bulletin Board issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a regional or national stock exchange.
To have our common stock listed on any of the public trading markets, including the OTC Bulletin Board, we will require a market maker to sponsor our securities. We have not yet engaged any market maker to sponsor our securities, and there is no guarantee that our securities will meet the requirements for quotation or that our securities will be accepted for listing on the OTC Bulletin Board. This could prevent us from developing a trading market for our common stock.
HOLDERS
As of the date of this Prospectus there is one (1) holder of record of our common stock.
DIVIDENDS
To date, we have not paid dividends on shares of our common stock and we do not expect to declare or pay dividends on shares of our common stock in the foreseeable future. The payment of any dividends will depend upon our future earnings, if any, our financial condition, and other factors deemed relevant by our Board of Directors.
EQUITY COMPENSATION PLANS
As of the date of this Prospectus we did not have any equity compensation plans.
REGULATION M
Our officer and director, who will offer and sell the shares, is aware that he is required to comply with the provisions of Regulation M, promulgated under the Securities Exchange Act of 1934, as amended. With certain exceptions, Regulation M precludes the officer and director, sales agent, any broker-dealer or other person who participate in the distribution of shares in this Offering from
bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire distribution is complete.
WHERE YOU CAN FIND MORE INFORMATION
We intend to file annual, quarterly and special reports, and other information with the SEC, as required. You may read or obtain a copy of the registration statement to be filed or any other information we file with the SEC at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information regarding the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Our SEC filings are also available to the public from the SEC web site at www.sec.gov, which contains our reports, and other information we file electronically with the SEC.
FINANCIAL STATEMENTS
The audited financial statements of Perkins Oil & Gas Inc. for the year ended June 30, 2012, and related notes, included in this prospectus have been audited by PLS, CPA, and have been so included in reliance upon the opinion of such accountants given upon their authority as an expert in auditing and accounting.
The unaudited financial statements of Perkins Oil & Gas Inc. for the three months ended September 30, 2012, and related notes, prepared by the company and included in this prospectus have been reviewed by PLS, CPA.
PLAN OF OPERATION
This section of the prospectus includes a number of forward-looking statements
that reflect our current views with respect to future events and financial
performance. Forward-looking statements are often identified by words like:
believe, expect, estimate, anticipate, intend, project and similar expressions,
or words which, by their nature, refer to future events. You should not place
undue certainty on these forward-looking statements, which apply only as of the
date of this prospectus. These forward-looking states are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical results or out predictions.
Our current cash balance is $2,037. Our cash balance and revenues generated from the well lease may not be sufficient to cover the expenses we will incur during the next twelve months in a limited operations scenario or until we raise the funding from this Offering. If we experience a shortage of funds prior to funding we may utilize funds from our director, who has informally agreed to advance funds to allow us to pay for offering costs, filing fees, and professional fees, however he has no formal commitment, arrangement or legal obligation to advance or loan funds to the company. In order to achieve our business plan goals, we will need the funding from this Offering. We are an exploration stage company and have generated $2,343 in revenue to date. We have sold $20,000 in equity securities to pay for our minimum level of operations. Our auditor has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have only generated limited revenues from our oil sales.
Our plan of operation for the twelve months following the date of this prospectus is to continue the production program on the current lease while also searching for other appropriate leases. If we are able to sell our entire Offering with proceeds of $50,000 we plan to invest an additional $17,500 in a new lease. We anticipate spending an additional $15,408 (approx. $642.00 per month for each well) for monthly maintenance fees once the well is operational, $10,000 on professional fees, including fees payable for complying with reporting obligations, $5,000 in general administrative costs and $2,092 in working capital. Total expenditures over the next 12 months are therefore expected to be approximately $50,000. We will require the funds from this Offering to proceed.
If we are unable to raise the entire $50,000 from our Offering we would adjust our spending based on the amount of funds available. We may forgo the purchase of another lease until we are able to accumulate enough from revenue to allow us to purchase an additional lease. If we are only able to sell 40% of the securities we are offering ($20,000), substantially all of the funds raised by this Offering will be spent on the monthly maintenance of the current well and assuring that we meet our corporate and disclosure obligations so that we remain in good standing with the State of Nevada and maintain our status as a reporting issuer with the SEC.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
There is no historical financial information about us upon which to base an evaluation of our performance. We are an exploration stage corporation and have not generated limited revenues from operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources, possible delays in the exploration of our properties, and possible cost overruns due to price and cost increases in services.
To become profitable and competitive, we must continue to receive revenues from our current lease and find other profitable properties in which we will invest. We believe that our current cash balance and revenue will allow us to operate for one year based on our current limited operations.
LIQUIDITY AND CAPITAL RESOURCES
To meet our need for cash we are attempting to raise money from this Offering. We cannot guarantee that we will be able to sell all the shares required. If we are successful any money raised will be applied to the items set forth in the Use of Proceeds section of this prospectus. Our director has agreed to advance funds as needed until the Offering is completed or failed. While he has agreed to advance the funds, the agreement is verbal and is unenforceable as a matter of law.
We received our initial funding of $20,000 through the sale of common stock to J Michael Page, our officer and director, who purchased 4,000,000 shares of our common stock at $0.005 per share in June, 2012.
On July 9, 2012 the Company acquired the Perkins Lease in Webster Parish, Louisiana for $17,500.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.
SIGNIFICANT ACCOUNTING POLICIES
ACCOUNTING BASIS
The statements were prepared following generally accepted accounting principles
of the United States of America consistently applied. The Company's fiscal year
end is June 30.
The accompanying financial statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America and are presented in U.S. dollars. The Company is currently an exploration stage enterprise. An exploration stage enterprise is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from. All losses accumulated since the inception of the business have been considered as part of its exploration stage activities.
USE OF ESTIMATES
Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.
CASH AND CASH EQUIVALENTS
Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition. The Company had $2,037 of cash at September 30, 2012.
INVESTMENTS IN OIL AND GAS PROPERTY
The Company is an exploration stage oil and gas company and expects to receive some revenue from its operations. In June 2012 the company paid $17,500 for 25% working interest and an 18.75% net revenue interest in the Perkins Lease in Caddo Pine Island Field that lies in the northern part of Webster Parish, Louisiana. The lease shall be for a period of TWO (2) years (called "primary term") and as long thereafter as (1) oil, gas, sulphur or other mineral is produced or (2) is maintained in force in any other manner provided within the lease. The lease is from October 20, 2011 until October 20, 2013 and is effective May 31, 2012. Amortization of the lease will be calculated from May 31, 2012 through October 31, 2013. Amortization expenses for the year ending June 30, 2012 were $1,033, and period ending September 30, 2012 $3,169.
The Company follows the successful efforts method of accounting for its oil and gas activities. Under the successful efforts method, lease acquisition costs and all development costs are capitalized. Exploratory drilling costs are capitalized until the results are determined. If proved reserves are not discovered, the exploratory drilling costs are expensed. Other exploratory costs, such as seismic costs and other geological and geophysical expenses, are expensed as incurred. Depletion of capitalized oil and gas well costs is provided using the units of production method based on estimated proved developed oil and gas reserves of the respective oil and gas properties.
To date, mineral property exploration costs have been expensed as incurred. To date the Company has not established any proven or probable reserves on its mineral properties.
REVENUE RECOGNITION
The Company has yet to realize revenues from operations and is still in the exploration stage. The Company will recognize revenue when delivery of goods or completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is reasonably assured.
INCOME TAXES
The Company accounts for its income taxes in accordance with FASB Accounting Standards Codification ("ASC") No.740, "Income Taxes". Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.
FINANCIAL INSTRUMENTS
Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability. ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:
* Level 1: Quoted prices (unadjusted) for identical assets or
liabilities in active markets. A quoted price in an active market
provides the most reliable evidence of fair value and must be used to
measure fair value whenever available.
* Level 2: Significant other observable inputs other than Level 1 prices
such as quoted prices for similar assets or liabilities; quoted prices
in markets that are not active; or other inputs that are observable or
can be corroborated by observable market data.
* Level 3: Significant unobservable inputs that reflect a reporting
entity's own assumptions about the assumptions that market
participants would use in pricing an asset or liability. For example,
level 3 inputs would relate to forecasts of future earnings and cash
flows used in a discounted future cash flows method.
The recorded amounts of financial instruments, including cash equivalents and accounts payable approximate their market values as of September 30, 2012.
NET LOSS PER SHARE
Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company. Because the Company does not have any potentially dilutive securities, the accompanying presentation is only of basic loss per share.
SHARE BASED EXPENSES
The Company records stock based compensation in accordance with the guidance in ASC Topic 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON FINANCIAL DISCLOSURE
None.
DIRECTOR, EXECUTIVE OFFICER, PROMOTER AND CONTROL PERSON
The officer and director of Perkins Oil & Gas, whose one year terms will expire 6/30/13, or at such a time as his successor(s) shall be elected and qualified is as follows:
Name & Address Age Position Date First Elected Term Expires
-------------- --- -------- ------------------ ------------
J Michael Page 68 President, 5/25/12 6/30/13
1445 Marpole Avenue #409 Secretary,
Vancouver, BC V6H 1S5 Treasurer,
CFO, CEO &
Director
|
The foregoing person is a promoter of Perkins Oil & Gas, as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933. Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and qualified. Officers are appointed to serve until the meeting of the board of directors following the next annual meeting of stockholders and until their successors have been elected and qualified.
Mr. Page currently devotes 2-4 hours per week to company matters, in the future he intends to devote as much time as the board of directors deems necessary to manage the affairs of the company.
No executive officer or director of the corporation has been the subject of any order, judgment, or decree of any court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring, suspending or otherwise limiting him from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or
employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities.
No executive officer or director of the corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending.
Background Information
J MICHAEL PAGE has been the President, CEO, Treasurer, CFO, Secretary, and Director of the Company since inception. He attended the St. George School of the University of British Columbia in Vancouver where between 1965 and 1969 he studied Physiology and Economics. Mr. Page has been retired for the last five years. Prior to that Mr. Page was employed primarily in management positions for various technology companies specializing in wireless electronic systems and smart card readers.
EXECUTIVE COMPENSATION
Our current officer receives no compensation. The current Board of Directors is comprised of Mr. Page.
SUMMARY COMPENSATION TABLE
Change in
Pension
Value and
Non-Equity Nonqualified
Incentive Deferred All
Name and Plan Compen- Other
Principal Stock Option Compen- sation Compen-
Position Year Salary Bonus Awards Awards sation Earnings sation Totals
------------ ---- ------ ----- ------ ------ ------ -------- ------ ------
J Michael Page, 2012 0 0 0 0 0 0 0 0
President,
CFO & CEO
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
Option Awards Stock Awards
----------------------------------------------------------------- ----------------------------------------------
Equity
Incentive
Equity Plan
Incentive Awards:
Plan Market or
Awards: Payout
Equity Number of Value of
Incentive Number Unearned Unearned
Plan Awards; of Market Shares, Shares,
Number of Number of Number of Shares Value of Units or Units or
Securities Securities Securities or Units Shares or Other Other
Underlying Underlying Underlying of Stock Units of Rights Rights
Unexercised Unexercised Unexercised Option Option That Stock That That That
Options (#) Options (#) Unearned Exercise Expiration Have Not Have Not Have Not Have Not
Name Exercisable Unexercisable Options (#) Price Date Vested(#) Vested Vested Vested
---- ----------- ------------- ----------- ----- ---- --------- ------ ------ ------
J Michael 0 0 0 0 0 0 0 0 0
Page, CEO
& CFO
|
DIRECTOR COMPENSATION
Change in
Pension
Value and
Fees Non-Equity Nonqualified
Earned Incentive Deferred
Paid in Stock Option Plan Compensation All Other
Name Cash Awards Awards Compensation Earnings Compensation Total
---- ---- ------ ------ ------------ -------- ------------ -----
J Michael Page, 0 0 0 0 0 0 0
Director
|
There are no current employment agreements between the company and its executive officer.
In June 2012 Mr. Page purchased 4,000,000 shares of our common stock at $0.005 per share. The terms of these stock issuances were as fair to the company, in the opinion of the board of directors, as could have been made with an unaffiliated third party.
Mr. Page currently devotes approximately 2-4 hours per week to manage the affairs of the company. He has agreed to work with no remuneration until such time as the company receives sufficient revenues necessary to provide management salaries. At this time, we cannot accurately estimate when sufficient revenues will occur to implement this compensation, or what the amount of the compensation will be.
There are no annuity, pension or retirement benefits proposed to be paid to officers, directors or employees in the event of retirement at normal retirement date pursuant to any presently existing plan provided or contributed to by the company or any of its subsidiaries, if any.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth information on the ownership of Perkins Oil and Gas' voting securities by officers, directors and major stockholders as well as those who own beneficially more than five percent of our common stock as of the date of this prospectus:
Name and No. of No. of Address of Shares Shares Percentage of Ownership Beneficial Before After Before After Owner(1) Offering Offering Offering Offering -------- -------- -------- -------- -------- J Michael Page 4,000,000 4,000,000 100% 44%* All Officers and Directors as a Group 4,000,000 4,000,000 100% 44%* ---------- |
* Assuming all 5,000,000 shares are sold.
(1) The person named may be deemed to be a "parent" and "promoter" of the
Company, within the meaning of such terms under the Securities Act of 1933,
as amended.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In June 2012 Mr. Page purchased 4,000,000 shares of our common stock at $0.005 per share. All of such shares are "restricted" securities, as that term is defined by the Securities Act of 1933, as amended, and are held by the officer and director of the Company. (See "Principal Stockholders".)
Mr. Page will not be paid for any underwriting services that he performs on our behalf with respect to this Offering. He will also not receive any interest on any funds that he may advance to us for expenses incurred prior to the Offering being closed.
INDEMNIFICATION
Our Bylaws provide that we will indemnify our directors and officers to the fullest extent not prohibited by Nevada law.
The general effect of the foregoing is to indemnify a control person, officer or director from liability, thereby making us responsible for any expenses or damages incurred by such control person, officer or director in any action brought against them based on their conduct in such capacity, provided they did not engage in fraud or criminal activity.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or control persons pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
STOCK TRANSFER AGENT
We have not engaged the services of a transfer agent at this time. However, within the next twelve months we anticipate doing so. Until such a time a transfer agent is retained, we will act as our own transfer agent.
PLS CPA, A PROFESSIONAL CORP.
* 4725 MERCURY STREET #210 * SAN DIEGO * CALIFORNIA 92111 *
* TELEPHONE (858)722-5953 * FAX (858) 761-0341 * FAX (858) 433-2979 * E-MAIL changgpark@gmail.com *
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders Perkins Oil & Gas Inc.
We have audited the accompanying balance sheet of Perkins Oil & Gas Inc. (An Exploration Stage "Company") as of June 30, 2012 and the related statements of operations, changes in shareholders' equity and cash flows for the period from May 25, 2012 (inception) to June 30, 2012. 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 audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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 statements presentation. We believe that our audit provides 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 Perkins Oil & Gas Inc. as of June 30, 2012, and the result of its operations and its cash flows for the period from May 25, 2012 (inception) to June 30, 2012 in conformity with U.S. generally accepted accounting principles.
The financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 6 to the financial statements, the Company's losses from operations raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/PLS CPA -------------------- PLS CPA, A Professional Corp. October 31, 2012 San Diego, CA. 92111 |
Registered with the Public Company Accounting Oversight Board
ASSETS
CURRENT ASSETS
Cash $ 2,406
--------
TOTAL CURRENT ASSETS 2,406
OTHER ASSETS
Oil and Gas Property (Successful Efforts Method) 17,500
Less: Accumulated Amortization (1,033)
--------
TOTAL OTHER ASSETS 16,467
--------
TOTAL ASSETS $ 18,873
========
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LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 7,743
Advances from Officers 0
--------
TOTAL CURRENT LIABILITIES 7,743
--------
TOTAL LIABILITIES 7,743
STOCKHOLDERS' EQUITY
Common stock, ($0.001 par value, 75,000,000 shares
authorized; 4,000,000 shares issued and outstanding
as of June 30, 2012 4,000
Additional paid-in capital 16,001
Deficit accumulated during exploration stage (8,871)
--------
TOTAL STOCKHOLDERS' EQUITY 11,130
--------
STOCKHOLDERS' EQUITY $ 18,873
========
|
See Notes to Financial Statements
REVENUES
Revenues $ --
----------
TOTAL REVENUES --
GENERAL & Administrative Expenses
Administrative Expenses 7,838
Amortization 1,033
Exploration costs --
----------
TOTAL GENERAL & ADMINISTRATIVE EXPENSES 8,871
----------
LOSS FROM OPERATION (8,871)
----------
OTHER INCOME (EXPENSE) --
NET INCOME (LOSS) $ (8,871)
==========
BASIC EARNINGS PER SHARE $ (0.00)
==========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 3,666,667
==========
|
See Notes to Financial Statements
Deficit
Common Stock Additional During
---------------------- Paid-in Exploration
Shares Amount Capital Stage Total
------ ------ ------- ----- -----
Balance, May 25, 2012 (Inception) -- $ -- $ -- $ -- $ --
Commn stock issued, May 28, 2012
at $.005 per share 4,000,000 4,000 16,001 -- 20,001
Loss for the period beginning
May 25, 2012 (inception) to
June 30, 2012 -- -- -- (8,871) (8,871)
---------- ------- -------- -------- --------
BALANCE, JUNE 30, 2012 4,000,000 $ 4,000 $ 16,001 $ (8,871) $ 11,130
========== ======= ======== ======== ========
|
See Notes to Financial Statements
May 25, 2012
(inception)
through
June 30,
2012
--------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (8,871)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Amortization 1,033
Changes in operating assets and liabilities:
Increase(Decrease) in Accounts payable and accrued liabilities 7,743
Increase(Decrease) in Advance from Officers --
--------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (95)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of Oil and Gas Property (17,500)
--------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (17,500)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock 20,001
--------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 20,001
--------
NET INCREASE (DECREASE) IN CASH 2,406
CASH AT BEGINNING OF PERIOD --
--------
CASH AT END OF PERIOD $ 2,406
========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ --
========
Income Taxes $ --
========
|
See Notes to Financial Statements
Perkins Oil & Gas, Inc.
(An Exploration Stage Company)
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Perkins Oil & Gas, Inc. (the "Company") was incorporated on May 25, 2012 under the laws of the State of Nevada. The Company is in the exploration stage as defined under Accounting Standards Codification ("ASC 915") and it intends to engage in the exploration and development of oil and gas properties. The Company's activities to date have been limited to organization and capital.
The Company is primarily engaged in a lease assignment with Lanza Land Management LLC and has been assigned a 25% working interest and an 18.75% net revenue interest in the lease.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Basis
The statements were prepared following generally accepted accounting principles of the United States of America consistently applied. The Company's fiscal year end is June 30, 2012.
The accompanying financial statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America and are presented in U.S. dollars. The Company is currently an exploration stage enterprise. An exploration stage enterprise is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from. All losses accumulated since the inception of the business have been considered as part of its exploration stage activities.
Use of Estimates
Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.
Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition. The Company had $2,406 of cash at June 30, 2012.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Investments in Oil and Gas Property
The Company is an exploration stage oil and gas company and has not yet realized any revenue from its operations. In June 2012 the company paid $17,500 for 25% working interest and an 18.75% net revenue interest in the Perkins Lease in Caddo Pine Island Field that lies in the northern part of Caddo Parish, Louisiana. The lease shall be for a period of TWO (2) years (called "primary term") and as long thereafter as (1) oil, gas, sulphur or other mineral is produced or (2) is maintained in force in any other manner provided within the lease. The lease is from October 20, 2011 until October 20, 2013 and is effective May 31, 2012. Amortization of the lease will be calculated from May 31, 2012 through October 31, 2013. Amortization expenses for the year ending June 30, 2012 were $1,033.
The Company follows the successful efforts method of accounting for its oil and gas activities. Under the successful efforts method, lease acquisition costs and all development costs are capitalized. Exploratory drilling costs are capitalized until the results are determined. If proved reserves are not discovered, the exploratory drilling costs are expensed. Other exploratory costs, such as seismic costs and other geological and geophysical expenses, are expensed as incurred. Depletion of capitalized oil and gas well costs is provided using the units of production method based on estimated proved developed oil and gas reserves of the respective oil and gas properties.
To date, mineral property exploration costs have been expensed as incurred. To date the Company has not established any proven or probable reserves on its mineral properties. |
Revenue Recognition
The Company has yet to realize revenues from operations and is still in the exploration stage. The Company will recognize revenue when delivery of goods or completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is reasonably assured.
Income Taxes
The Company accounts for its income taxes in accordance with FASB Accounting Standards Codification ("ASC") No.740, "Income Taxes". Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.
Financial Instruments
Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability. ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:
* Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and must be used to measure fair value whenever available.
* Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
* Level 3: Significant unobservable inputs that reflect a reporting entity's own assumptions about the assumptions that market participants would use in pricing an asset or liability. For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discounted future cash flows method.
The recorded amounts of financial instruments, including cash equivalents approximate their market values as of June 30, 2012.
Net Loss Per Share
Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company. Because the Company does not have any potentially dilutive securities, the accompanying presentation is only of basic loss per share.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Share Based Expenses
The Company records stock based compensation in accordance with the guidance in ASC Topic 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.
NOTE 3 - PROVISION FOR INCOME TAXES
Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.
June 30,
2012
--------
Net operating loss carryforward $ 3,016
Valuation allowance (3,016)
--------
Net deferred income tax asset $ --
========
|
NOTE 4 - COMMITMENTS AND CONTINGENCIES
Litigation
The Company is not presently involved in any litigation.
NOTE 5 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
NOTE 6 - GOING CONCERN
Future issuances of the Company's equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern. The Company's present revenues are insufficient to meet operating expenses.
The financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $8,871 since its inception and requires capital for its contemplated operational and exploration activities to take place. The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.
NOTE 7 - RELATED PARTY TRANSACTIONS
J. Michael Page, the sole officer and director of the Company, may in the future, become involved in other business opportunities as they become available, thus he may face a conflict in selecting between the Company and his other business opportunities. The Company has not formulated a policy for the resolution of such conflicts.
J. Michael Page, the sole officer and director of the Company, will not be paid for any underwriting services that he performs on behalf of the Company with respect to the Company's S-1 offering. He will also not receive any interest on any funds that he advances to the Company for offering expenses prior to the offering being closed which will be repaid from the proceeds of the offering.
NOTE 9 - STOCK TRANSACTIONS
On May 28, 2012, the Company issued a total of 4,000,000 shares of common stock to one director for cash in the amount of $0.005 per share for a total of $20,001 |
As of June 30, 2012 the Company had 4,000,000 shares of common stock issued and outstanding.
NOTE 10 - STOCKHOLDERS' EQUITY
The stockholders' equity section of the Company contains the following classes of capital stock as of June 30, 2012:
Common stock, $ 0.001 par value: 75,000,000 shares authorized; 4,000,000 shares issued and outstanding.
NOTE 11 - SUBSEQUENT EVENTS
In accordance with ASC 855, SUBSEQUENT EVENTS, the Company has evaluated subsequent events through October 31, 2012, the date of available issuance of these audited financial statements. During this period, the Company did not have any material recognizable subsequent events.
PLS CPA, A PROFESSIONAL CORP.
* 4725 MERCURY STREET #210 * SAN DIEGO * CALIFORNIA 92111 *
* TELEPHONE (858)722-5953 * FAX (858) 761-0341 * FAX (858) 433-2979 * E-MAIL changgpark@plscpasl.com *
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors of
Perkins Oil & Gas Inc.
We have reviewed the accompanying balance sheets of Perkins Oil & Gas Inc. (An Exploration Stage "Company") as of September 30, 2012, and the related statements of operations, and cash flows for the three ended September 30, 2012, and for the period from May 25, 2012 (inception) through September 30, 2012. These financial statements are the responsibility of the Company's management.
We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should be made to the financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Because of the Company's current status and limited operations there is substantial doubt about its ability to continue as a going concern. Management's plans in regard to its current status are also described in Note 6. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/s/ PLS CPA ----------------------------------- PLS CPA, A Professional Corp. January 15, 2013 San Diego, CA 92111 |
Registered with the Public Company Accounting Oversight Board
As of As of
September 30, June 30,
2012 2012
-------- --------
(Unaudited) (Audited)
ASSETS
CURRENT ASSETS
Cash $ 2,037 $ 2,406
-------- --------
TOTAL CURRENT ASSETS 2,037 2,406
OTHER ASSETS
Oil and Gas Property (Successful Efforts Method) 17,500 17,500
Less: Accumulated Amortization (4,202) (1,033)
-------- --------
TOTAL OTHER ASSETS 13,298 16,467
-------- --------
TOTAL ASSETS $ 15,335 $ 18,873
======== ========
LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 10,828 $ 7,743
Advances from Officers 0 0
-------- --------
TOTAL CURRENT LIABILITIES 10,828 7,743
-------- --------
TOTAL LIABILITIES 10,828 7,743
STOCKHOLDERS' EQUITY
Common stock, ($0.001 par value, 75,000,000 shares
authorized; 4,000,000 shares issued and outstanding
as of September 30, 2012 and June 30, 2012 4,000 4,000
Additional paid-in capital 16,001 16,001
Deficit accumulated during exploration stage (15,494) (8,871)
-------- --------
TOTAL STOCKHOLDERS' EQUITY 4,507 11,130
-------- --------
STOCKHOLDERS' EQUITY $ 15,335 $ 18,873
======== ========
|
See Notes to Financial Statements
May 25, 2012
Three Months (inception)
ended through
September 30, September 30,
2012 2012
---------- ----------
REVENUES
Revenues $ 2,343 $ 2,343
---------- ----------
TOTAL REVENUES 2,343 2,343
GENERAL & Administrative Expenses
Administrative Expenses 3,869 3,965
Amortization 3,169 4,202
Oil Well Operating and Maintenance Expenses 1,927 9,670
---------- ----------
TOTAL GENERAL & ADMINISTRATIVE EXPENSES 8,965 17,837
---------- ----------
LOSS FROM OPERATION (6,622) (15,494)
---------- ----------
OTHER INCOME (EXPENSE) -- --
---------- ----------
NET INCOME (LOSS) $ (6,622) $ (15,494)
========== ==========
BASIC EARNINGS PER SHARE $ (0.00)
==========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 4,000,000
==========
|
See Notes to Financial Statements
Deficit
Common Stock Additional During
-------------------- Paid-in Exploration
Shares Amount Capital Stage Total
------ ------ ------- ----- -----
Balance, May 25, 2012 (Inception) -- $ -- $ -- $ -- $ --
Common stock issued, May 28, 2012
at $.005 per share 4,000,000 4,000 16,001 -- 20,001
Loss for the period beginning
May 25, 2012 (inception) to
June 30, 2012 -- -- -- (8,871) (8,871)
---------- ------- -------- --------- --------
BALANCE, JUNE 30, 2012 4,000,000 4,000 16,001 (8,871) 11,130
========== ======= ======== ========= ========
Loss for the period ended
September 30, 2012 -- -- -- (6,623) (6,623)
---------- ------- -------- --------- --------
BALANCE, SEPTEMBER 30, 2012 4,000,000 $ 4,000 $ 16,001 $ (15,494) $ 4,507
========== ======= ======== ========= ========
|
See Notes to Financial Statements
May 25, 2012
Three Months (inception)
ended through
September 30, September 30,
2012 2012
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ (6,622) $(15,494)
Adjustments to reconcile net loss to net cash
provided by (used in) operating activities:
Amortization 3,169 4,202
Changes in operating assets and liabilities:
Increase(Decrease) in Accounts payable and accrued liabilities 3,084 10,828
Increase(Decrease) in Advance from Officers -- --
-------- --------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (369) (464)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of Oil and Gas Property -- (17,500)
-------- --------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- (17,500)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock -- 20,001
-------- --------
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES -- 20,001
-------- --------
NET INCREASE (DECREASE) IN CASH (369) 2,037
CASH AT BEGINNING OF PERIOD 2,406 --
-------- --------
CASH AT END OF PERIOD $ 2,037 $ 2,037
======== ========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during year for:
Interest $ -- $ --
======== ========
Income Taxes $ -- $ --
======== ========
|
See Notes to Financial Statements
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Perkins Oil & Gas, Inc. (the "Company") was incorporated on May 25, 2012 under the laws of the State of Nevada. The Company is in the exploration stage as defined under Accounting Standards Codification ("ASC 915") and it intends to engage in the exploration and development of oil and gas properties. The Company's activities to date have been limited to organization and capital.
The Company is primarily engaged in a lease assignment with Lanza Land Management LLC and has been assigned a 25% working interest and an 18.75% net revenue interest in the lease.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation of Financial Statements
The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by Accounting Principles generally accepted accounting principles in United States America ("US GAAP") for complete financial statements and related notes. The accompanying unaudited financial statements and related notes should be read in conjunction with the audited financial statements of the Company and notes thereto for the year ended June 30, 2012.
In the opinion of management, the accompanying unaudited financial statements
contain all adjustments (which include only normal recurring adjustments)
necessary to present fairly the balance sheets of the Company as of September
30, 2012 and the results of their operations and cash flows for the periods
ended September 30, 2012 are not necessarily indicative of the results to be
expected for the entire year.
Accounting Basis
The statements were prepared following generally accepted accounting principles
of the United States of America consistently applied. The Company's fiscal year
end is June 30, 2012.
The accompanying financial statements have been prepared using the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America and are presented in U.S. dollars. The Company is currently an exploration stage enterprise. An exploration stage enterprise is one in which planned principal operations have not commenced or if its operations have commenced, there has been no significant revenues there from. All losses accumulated since the inception of the business have been considered as part of its exploration stage activities.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
Use of Estimates
Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.
Cash and Cash Equivalents
Cash equivalents include short-term, highly liquid investments with maturities of three months or less at the time of acquisition. The Company had $2,037 of cash at June 30, 2012.
Investments in Oil and Gas Property
The Company is an exploration stage oil and gas company and expects to receive some revenue from its operations. In June 2012 the company paid $17,500 for 25% working interest and an 18.75% net revenue interest in the Perkins Lease in Caddo Pine Island Field that lies in the northern part of Webster Parish, Louisiana. The lease shall be for a period of TWO (2) years (called "primary term") and as long thereafter as (1) oil, gas, sulphur or other mineral is produced or (2) is maintained in force in any other manner provided within the lease. The lease is from October 20, 2011 until October 20, 2013 and is effective May 31, 2012. Amortization of the lease will be calculated from May 31, 2012 through October 31, 2013. Amortization expenses for the year ending June 30, 2012 were $1,033, and period ending September 30, 2012 $3,169.
The Company follows the successful efforts method of accounting for its oil and gas activities. Under the successful efforts method, lease acquisition costs and all development costs are capitalized. Exploratory drilling costs are capitalized until the results are determined. If proved reserves are not discovered, the exploratory drilling costs are expensed. Other exploratory costs, such as seismic costs and other geological and geophysical expenses, are expensed as incurred. Depletion of capitalized oil and gas well costs is provided using the units of production method based on estimated proved developed oil and gas reserves of the respective oil and gas properties.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
To date, mineral property exploration costs have been expensed as incurred. To date the Company has not established any proven or probable reserves on its mineral properties. |
Revenue Recognition
The Company has yet to realize revenues from operations and is still in the exploration stage. The Company will recognize revenue when delivery of goods or completion of services has occurred provided there is persuasive evidence of an agreement, acceptance has been approved by its customers, the fee is fixed or determinable based on the completion of stated terms and conditions, and collection of any related receivable is reasonably assured.
Income Taxes
The Company accounts for its income taxes in accordance with FASB Accounting Standards Codification ("ASC") No.740, "Income Taxes". Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax balances. Deferred tax assets and liabilities are measured using enacted or substantially enacted tax rates expected to apply to the taxable income in the years in which those differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the date of enactment or substantive enactment.
Financial Instruments
Fair value measurements are determined based on the assumptions that market participants would use in pricing an asset or liability. ASC 820-10 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. FASB ASC 820 establishes a fair value hierarchy that prioritizes the use of inputs used in valuation methodologies into the following three levels:
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
* Level 1: Quoted prices (unadjusted) for identical assets or liabilities in active markets. A quoted price in an active market provides the most reliable evidence of fair value and must be used to measure fair value whenever available.
* Level 2: Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
* Level 3: Significant unobservable inputs that reflect a reporting entity's own assumptions about the assumptions that market participants would use in pricing an asset or liability. For example, level 3 inputs would relate to forecasts of future earnings and cash flows used in a discounted future cash flows method.
The recorded amounts of financial instruments, including cash equivalents and accounts payable approximate their market values as of September 30, 2012.
Net Loss Per Share
Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company. Because the Company does not have any potentially dilutive securities, the accompanying presentation is only of basic loss per share.
Share Based Expenses
The Company records stock based compensation in accordance with the guidance in ASC Topic 718 which requires the Company to recognize expenses related to the fair value of its employee stock option awards. This eliminates accounting for share-based compensation transactions using the intrinsic value and requires instead that such transactions be accounted for using a fair-value-based method. The Company recognizes the cost of all share-based awards on a graded vesting basis over the vesting period of the award.
NOTE 3 - PROVISION FOR INCOME TAXES
Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carry-forwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance.
September 30, June 30,
2012 2012
-------- --------
Net operating loss carryforward $ 5,268 $ 3,016
Valuation allowance (5,268) (3,016)
-------- --------
Net deferred income tax asset $ -- $ --
======== ========
|
NOTE 4 - COMMITMENTS AND CONTINGENCIES
Litigation
The Company is not presently involved in any litigation.
NOTE 5 - RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
NOTE 6 - GOING CONCERN
Future issuances of the Company's equity or debt securities will be required in order for the Company to continue to finance its operations and continue as a going concern. The Company's present revenues are insufficient to meet operating expenses.
The financial statements of the Company have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred cumulative net losses of $15,494 since its inception and requires capital for its contemplated operational and exploration activities to take place. The Company's ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company's contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company's ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.
NOTE 7 - RELATED PARTY TRANSACTIONS
J. Michael Page, the sole officer and director of the Company, may in the future, become involved in other business opportunities as they become available, thus he may face a conflict in selecting between the Company and his other business opportunities. The Company has not formulated a policy for the resolution of such conflicts.
J. Michael Page, the sole officer and director of the Company, will not be paid for any underwriting services that he performs on behalf of the Company with respect to the Company's S-1 offering. He will also not receive any interest on any funds that he advances to the Company for offering expenses prior to the offering being closed which will be repaid from the proceeds of the offering.
NOTE 9 - STOCK TRANSACTIONS
On May 28, 2012, the Company issued a total of 4,000,000 shares of common stock to one director for cash in the amount of $0.005 per share for a total of $20,001 |
As of September 30, 2012 the Company had 4,000,000 shares of common stock issued and outstanding.
NOTE 10 - STOCKHOLDERS' EQUITY
The stockholders' equity section of the Company contains the following classes of capital stock as of September 30, 2012:
Common stock, $ 0.001 par value: 75,000,000 shares authorized; 4,000,000 shares issued and outstanding.
NOTE 11 - SUBSEQUENT EVENTS
In accordance with ASC 855, SUBSEQUENT EVENTS, the Company has evaluated subsequent events through January 15, 2013, the date of available issuance of these audited financial statements. During this period, the Company did not have any material recognizable subsequent event.
DEALER PROSPECTUS DELIVERY OBLIGATION
"UNTIL ______________, ALL DEALERS THAT EFFECT TRANSACTIONS IN THESE SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE DEALERS' OBLIGATION TO DELIVER A
PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS."
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated costs of the Offering are denoted below. Please note all amounts are estimates other than the Commission's registration fee.
Securities and Exchange Commission registration fee $ 7
Accounting fees and expenses $ 3,500
Legal fees $ 200
Preparation and EDGAR conversion fees $ 2,100
Transfer Agent fees $ 500
Printing $ 200
--------
Total $ 6,507
========
|
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The By-Laws of Perkins Oil & Gas, Inc. allow for the indemnification of the officers and directors in regard to their carrying out the duties of their offices. The board of directors will make determination regarding the indemnification of the director, officer or employee as is proper under the circumstances if he/she has met the applicable standard of conduct set forth in the Nevada General Corporation Law.
Section 78.751 of the Nevada Business Corporation Act provides that each corporation shall have the following powers:
"1. A corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, except an action by or in the right of the corporation, by reason of any fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or proceeding if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a pleas of nolo contendere or its equivalent, does not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation, and that, with respect to any criminal action or proceeding, he had a reasonable cause to believe that his conduct was unlawful.
2. A corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses, including amounts paid in settlement and attorneys fees actually and reasonably incurred by him in
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connection with the defense or settlement of the action or suit if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation. Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent jurisdiction, after exhaustion of all appeals there from, to be liable to the corporation or for amounts paid in settlement to the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent jurisdiction, determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.
3. To the extent that a director, officer, employee or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in sections 1 and 2, or in defense of any claim, issue or matter therein, he must be indemnified by the corporation against expenses, including attorneys fees, actually and reasonably incurred by him in connection with the defense.
4. Any indemnification under sections 1 and 2, unless ordered by a court or advanced pursuant to section 5, must be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances. The determination must be made:
a. By the stockholders;
b. By the board of directors by majority vote of a quorum consisting of directors who were not parties to the act, suit or proceeding;
c. If a majority vote of a quorum consisting of directors who were not parties to the act, suit or proceeding so orders, by independent legal counsel, in a written opinion; or
d. If a quorum consisting of directors who were not parties to the act, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion.
5. The certificate of articles of incorporation, the bylaws or an agreement made by the corporation may provide that the expenses of officers and directors incurred in defending a civil or criminal action, suit or proceeding must be paid by the corporation as they are incurred and in advance of the final disposition of the action, suit or proceeding, upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he is not entitled to be indemnified by the corporation. The provisions of this section do not affect any rights to advancement of expenses to which corporate personnel other than director or officers may be entitled under any contract or otherwise by law.
6. The indemnification and advancement of expenses authorized in or ordered by a court pursuant to this section:
a. Does not include any other rights to which a person seeking indemnification or advancement of expenses may be entitled under the certificate or articles of incorporation or any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, for either an action in his official capacity or an action in another capacity while holding his office, except that indemnification, unless ordered by a court pursuant to section 2 or for the advancement of expenses made pursuant to section 5, may not be made to or on behalf of any director or officer if a final adjudication establishes that his acts or
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omission involved intentional misconduct, fraud or a knowing violation of the law and was material to the cause of action.
b. Continues for a person who has ceased to be a director, officer, employee or agent and inures to the benefit of the heirs, executors and administrators of such a person.
c. The Articles of Incorporation provides that "the Corporation shall indemnify its officers, directors, employees and agents to the fullest extent permitted by the General Corporation Law of Nevada, as amended from time to time."
As to indemnification for liabilities arising under the Securities Act of 1933 for directors, officers or persons controlling Perkins Oil & Gas, we have been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy and unenforceable.
RECENT SALES OF UNREGISTERED SECURITIES
Set forth below is information regarding the issuance and sales of securities without registration since inception. No such sales involved the use of an underwriter; no advertising or public solicitation was involved; the securities bear a restrictive legend; and no commissions were paid in connection with the sale of any securities.
In June 2012, a total of 4,000,000 shares of common stock were issued in exchange for $20,000 US, or $.005 per share. These securities were issued to J Michael Page, the officer and director of the company.
EXHIBITS
Exhibit 3.1 Articles of Incorporation Exhibit 3.2 Bylaws Exhibit 5.1 Opinion re: Legality Exhibit 10.1 Perkins Lease Agreement Exhibit 10.2 Lease Assignment Agreement Exhibit 10.3 Operating Agreement Exhibit 23.1 Consent of counsel (see Exhibit 5) Exhibit 23.2 Consent of independent auditor |
UNDERTAKINGS
a. The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
i. To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
ii. To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
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of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than 20% change
in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
iii. To include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
2. That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the Offering.
4. That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
i. If the registrant is relying on Rule 430B (230.430B of this
chapter):
A. Each prospectus filed by the registrant pursuant to Rule
424(b)(3)shall be deemed to be part of the registration
statement as of the date the filed prospectus was deemed
part of and included in the registration statement; and
B. Each prospectus required to be filed pursuant to Rule
424(b)(2), (b)(5), or (b)(7) as part of a registration
statement in reliance on Rule 430B relating to an offering
made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the
purpose of providing the information required by section
10(a) of the Securities Act of 1933 shall be deemed to be
part of and included in the registration statement as of the
earlier of the date such form of prospectus is first used
after effectiveness or the date of the first contract of
sale of securities in the Offering described in the
prospectus. As provided in Rule 430B, for liability purposes
of the issuer and any person that is at that date an
underwriter, such date shall be deemed to be a new effective
date of the registration statement relating to the
securities in the registration statement to which that
prospectus relates, and the offering of such securities at
that time shall be deemed to be the initial bona fide
offering thereof. Provided, however, that no statement made
in a registration statement or prospectus that is part of
the registration statement or made in a document
incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the
registration statement will, as to a purchaser with a time
of contract of sale prior to such effective date, supersede
or modify any statement that was made in the registration
statement or prospectus that was part of the registration
statement or made in any such document immediately prior to
such effective date; or
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ii. If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
5. That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
i. Any preliminary prospectus or prospectus of the undersigned
registrant relating to the offering required to be filed pursuant
to Rule 424;
ii. Any free writing prospectus relating to the offering prepared by
or on behalf of the undersigned registrant or used or referred to
by the undersigned registrant;
iii. The portion of any other free writing prospectus relating to the
offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the
undersigned registrant; and
iv. Any other communication that is an offer in the Offering made by
the undersigned registrant to the purchaser.
Insofar as indemnification for liabilities, arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
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SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe it meets all of the requirements for filing Form S-1 and authorized this registration statement to be signed on its behalf by the undersigned, in the city of Vancouver, BC on January 30, 2013.
Perkins Oil & Gas Inc.
/s/ J Michael Page
-------------------------------------
By: J Michael Page, Director
(Principal Executive Officer)
|
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following person in the capacities and date stated.
/s/ J Michael Page January 30, 2013
--------------------------------------- ----------------
J Michael Page, President & Director Date
(Principal Executive Officer, Principal
Financial Officer, Principal Accounting
Officer)
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Exhibit 3.1
ROSS MILLER
Secretary of State
206 North Carson Street
Carson City, Nevada 89701-4298
(775) 684-5708 Website: www.nvsos.gov
Document Number
20120370664-21
Filing Date and Time:
05/25/2012 11:50 AM
Entity #
E0289622012-9
ARTICLES OF INCORPORATION
(PURSUANT TO NRS 78)
1. Name of Corporation: PERKINS OIL & GAS INC.
2. Resident Agent for
Service of Process: Sage International, Inc.
3. Authorized Stock: Number of Shares with par value: 75,000,000
Par value per share: $0.001
4. Name & Address of Board
Of Directors/Trustees: Robert Weaver
721 Devon Ct.
San Diego, CA 92109
5. Purpose:
6. Name, Address & Signature
Of Incorporator: Robert Weaver /s/ Robert Weaver
721 Devon Ct.
San Diego, CA 92109
7. Certificate of Acceptance
Of Appointment of Resident
Agent: I hereby accept appointment as Resident Agent
for the above named corporation.
/s/ Sage International 5/25/10
Authorized Signature of R.A. Date
|
Exhibit 3.2
BYLAWS
OF
PERKINS OIL & GAS INC
(a Nevada corporation)
(effective May 25, 2012)
ARTICLE I
Stockholders
Section 1.1 Annual Meetings. An annual meeting of stockholders shall be held for the election of directors at such date, time and place, either within or without the state of Nevada, as may be designated by resolution of the Board of Directors from time to time. Any other proper business may be transacted at the annual meeting.
Section 1.2 Special Meetings. Special meetings of stockholders for any purpose or purposes may be called at any time by the Board of Directors, or by a committee of the Board of Directors which has been duly designated by the Board of Directors and whose powers and authority include the power to call such meetings, but such special meetings may not be called by any other person or persons.
Section 1.3 Notice of Meetings. Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, date and hour of the meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Unless otherwise provided by applicable law or the Articles of Incorporation, the written notice of any meeting shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, such notice shall be deemed to be given when deposited in the mail, postage prepaid, directed to the stockholder at their address as it appears on the records of the Corporation.
Section 1.4 Adjournments. Any meeting of stockholders, annual or special, may adjourn from time to time to reconvene at the same or some other place and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.
Section 1.5 Quorum. At each meeting of stockholders, except where otherwise provided by law or the Articles of Incorporation or these Bylaws, the holders of a majority of the outstanding shares of stock entitled to vote at the meeting, present in person or by proxy, shall constitute a quorum'. In the absence of a quorum, the stockholders so present may, by majority vote, adjourn the meeting from time to time in the manner provided in Section 1.4 of these Bylaws until a quorum shall attend. Shares of its own stock belonging to the corporation or to another corporation, if a majority of the shares entitled to vote in the election of directors of such other corporation is held, directly or indirectly, by the corporation, shall neither be entitled to vote nor be counted for quorum purposes; provided, however, that the foregoing shall not limit the right of any corporation to vote stock, including but not limited to its own stock, held by it in a fiduciary capacity.
Section 1.6 Conduct. Meetings of stockholders shall be presided over by the Chairman of the Board, if any, or in their absence, the president, or in their absence by a Vice President, or in their absence, by a chairman designated by the Board of Directors, or their absence, by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in their absence the chairman of the meeting may appoint any person to act as secretary of the meeting.
Section 1.7 Voting; proxies. Unless otherwise provided by law or the Articles of Incorporation, each stockholder entitled to vote at any meeting of stockholders shall be entitled to one vote for each share of stock held by him which has voting power upon the matter in question. Each stockholder entitled to vote at a
meeting of stockholders may authorize another person or persons to act for him by proxy, but no such proxy shall be voted or acted upon after three year after its date unless the proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A stockholder may revoke any proxy which is not irrevocable by attending the meeting and voting in person or by filing an instrument in writing revoking the proxy or another duly executed proxy bearing a later date with the Secretary of the Corporation. Unless otherwise required by law, voting at meetings of-stockholders need not be by written ballot and need not be conducted by inspectors unless the board of directors or holders of a majority of the outstanding shares of all classes of stock entitled to vote thereon present in person or by proxy at such meeting shall so determine. At all meetings of stockholders for the election of directors a plurality of the votes cast shall be sufficient to elect. All other elections and questions shall, unless otherwise provided by law or by the Articles of lncorporation or these Bylaws, be decided by the vote of the holders of a majority of the outstanding shares of stock entitled to vote thereon present in person or by proxy at the meeting'
Section 1.8 Fixing Date for Determination of Stockholders of Record.
(a) In order that the corporation may determine the stockholders entitled to
notice of or to vote at any meeting of stockholders or any adjournment thereof
or entitled to receive payment of any dividend or other distribution or
allotment of any rights, or entitled to exercise any rights in respect of any
change, conversion or exchange of stock or for the purpose of any other lawful
action, the Board of Directors may fix, in advance, a record date, which shall
not precede the date such record date is fixed and shall not be more than sixty
(60) nor less than ten (10) days before the date of such meeting, nor more than
sixty (60) days prior to anv other action. If no record date is fixed, the
record date for determining stockholders entitled to notice of or to vote at a
meeting of stockholders shall be at the close of business on the day next
preceding the day on which notice is given. The record date for any other
purpose other than stockholder action by written consent shall be at the close
of business on the day on which the Board of Directors adopts the resolution
relating thereto. A determination of stockholders of record entitled to notice
of or to vote at a meeting of stockholders shall apply to any adjournment of the
meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.
(b) In order that the corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board of Directors' Any stockholder of record seeking to have the stockholders authorize or take corporate action by written consent shall, by written notice to the Secretary, request the Board of Directors to fix a record date. The Board of Directors shall promptly, but in all events within (10) days after the date on which such a request is received, adopt a resolution fixing the record date. If no record date has been fixed by the Board of Directors within ten (10) days of the date on which such a request is received, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be-taken is delivered to the corporation by delivery to its registered office in the state of Nevada, its principal place of business, or any officer or agent of the Corporation having custodv of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by applicable law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the date on which the Board of Directors adopts the resolution taking such prior action.
Section 1.9 List of Stockholders Entitled to Vote. The Secretary shall prepare and make, at least ten (10) days before every meeting of Stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to
the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the-meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof and may be inspected by any stockholder who is present. The stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list of stockholders or the books of the Corporation, or to vote in person or by proxy at any meeting of stockholders.
Section 1.10 Inspectors of Elections, Opening and Closing the Polls
(a) If required by Nevada law, the Board of Directors by resolution shall appoint one or more inspectors, which inspector or inspectors may include individuals who serve the Corporation in other capacities, including, without limitation, as officers, employees, agents or representatives of the corporation, to act at the meeting and make a written report thereof. The procedures, oath, duties, and determinations with respect to inspectors shall be as provided under the law.
(b) The chairman of any meeting shall fix and announce at the meeting the date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting.
Section 1.11 Action by written consent of stockholders. Unless otherwise restricted by the Articles of lncorporation any action required or permitted to be taken at any annual or special meeting of the stockholders may be taken without a meeting, without prior notice and without a vote, if a consent in writing setting forth the action so taken' shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted, prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.
Section 1.12 No Limitation on Voting Rights; Limitation on Dissenter's Rights'. To the extent permissible under the applicable law of any jurisdiction to which the corporation may become subject by reason of the conduct of business, the ownership of assets, the residence of stockholders , the location of offices or facilities, or any other item, the Corporation elects not to be governed by the provisions of any statute that (i) limits, restricts, modified, suspends, terminates, or otherwise affects the rights of any shareholder to cast one vote for each share of common stock registered in the name of such shareholder on the books of the Corporation, without regard to whether such shares were acquired directly from the corporation or from any other person and without regard to whether such shareholder has the power to exercise or direct the exercise of voting power over any specific fraction of the shares of common stock of the Corporation issued and outstanding or (ii) grants to any shareholder the right to have his or her stock redeemed or purchased by the Corporation or any other shareholder on the acquisition by any person or group of persons of shares of the corporation. In particular, to the extent permitted under the laws of the state of incorporation, the Corporation elects not to be governed by any such provision, including the provisions of Sections 78.378 to 78.3793, inclusive, of the Nevada Revised Statutes, or any statute of similar effect or tenor.
ARTICLE II
Board of Directors
Section 2.1 Number; Qualifications. The Board of Directors shall consist of one or more members, the number thereof to be determined from time to time by resolution of the Board of Directors. The initial number of directors shall be one (1) and thereafter shall be fixed from time to time by resolution of the Board of Directors- Directors need not be stockholders. The Board of Directors may, if it so determines, choose a Chairman of the Board and a Vice Chairman of the Board from among its members
Section 2.2 Election; Resignation; Removal; Vacancies. The Board of Directors shall initially consist of the persons elected as such by the incorporator or named in the corporation's Articles of Incorporation. At the first annual
meeting of stockholders and at each annual meeting thereafter, tire stockholders shall elect Directors to replace those Directors whose terms then expire. Any Director may resign at any time upon written notice to the Corporation. Any one or more of the directors may be removed for cause by action of the Board of Directors. Any or all of the directors may be removed with or without cause by vote of the stockholders. Any vacancy occurring in the Board of Directors may be filled by the affirmative vote of a majority of the Board, although such majority is less than a quorum, or by a plurality of the votes cast at a meeting of stockholders, and each director so elected shall hold office until the expiration of the term of office of the Director whom they replaced.
Section 2.3 Regular Meetings. Regular meetings of the Board of Directors may be held at such places within or without the State of Nevada and at such times is the Board of Directors may from time to time determine. Notice of regular meetings need not be given if the date, times and places thereof are fixed by resolution of the Board of Directors.
Section 2.4 Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board, the president or a majority of the Board of Directors then in office and may be held at any time, date or place, within or without the State of Nevada, as the person or persons calling the meeting shall fix. Notice of the time, date and place of such meeting shall be given, orally or in writing, by the person or persons calling the meeting to all directors at least four (4) days before the meeting if the notice is mailed, or at least twenty-four (24) hours before the meeting if such notice is given by telephone, hand-delivery, telegram, email, facsimile or similar communication method. Unless otherwise indicated in the notice, any and all business may be transacted at a special meeting.
Section 2.5 Telephonic Meetings Permitted. Members of the Board of Directors, or any committee designated by the Board, may participate in a meeting of such Board or committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this bylaw shall constitute presence in person at such meeting.
Section 2.6 Quorum; Vote Required for Action. At all meetings of the Board of Directors a majority of the whole Board shall constitute a quorum for the transaction of business. Except as otherwise provided in these Bylaws, or in the Articles of Incorporation or required by law, the vote of a majority of the directors present shall be the act of the Board of Directors.
Section 2.7 Conduct. Meetings of the Board of Directors shall be presided over by of the Board, if any, or in their absence, by the Vice Chairman of the Board, if any, or in their absence by the President, or in their absence by a chairman chosen at the meeting. The Secretary shall act as secretary of the meeting, but in their absence the chairman of the meeting may appoint any person to act as secretary of the meeting.
Section 2.8 Written Action by Directors. Unless otherwise restricted by the Articles of Incorporation, any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof may be taken without a meeting if all members of the Board or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee.
Section 2.9 Powers. The Board of Directors may, except as otherwise required by law or the Articles of Incorporation, exercise all such powers and do all such acts and things as may be exercised or done by the Corporation.
Section 2.10 Compensation of Directors. Directors, as such, may receive, pursuant to a resolution of the Board of Directors, fees and other compensation for their services as directors, including without limitation their services as members of committees of the Board of Directors.
ARTICLE III
Committees
Section 3.1 Committees. The Board of Directors may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of the committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in place of such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it; but no such committee shall have power or authority in reference to amending the Articles of Incorporation (except that a committee may, to the extent authorized in the resolution or resolutions providing for the issuance of shares of stock adopted by the Board of Directors as provided in Section 7g.195 of the Nevada Revised statutes, fix any of the preferences or rights of such shares, except voting rights of the shares), adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the Corporation's property and assets, recommending to the stockholders a dissolution of the corporation or a revocation of dissolution, or amending these Bylaws; and unless the resolution expressly so provides, no such committee shall have the power or authority to declare a dividend or to authorize the issuance of stock.
Section 3.2 Committee Rules. Unless the Board of Directors otherwise provides, each committee designated by the Board may make, alter and repeal rules for conduct of its business. In the absence of such rules each committee shall conduct its business in the same manner as the Board of Directors conducts its business pursuant to Article II of these Bylaws.
ARTICLE IV
Officers
Section 4.1 Executive Officers; Election. Qualifications; Term of office; Resignation; Removal; Vacancies'. The Board of Directors shall choose a president, a secretary, and a Treasurer, and it may, if it so determines, choose one or more Vice presidents, Assistant Secretaries, Assistant Treasurer, and such other officers as it deems advisable. Each such officer shall hold office until the first meeting of the Board of Directors after the annual meeting of stockholders next succeeding this election, and until their successor is elected and qualified or until their earlier resignation or removal. Any officer may resign at any time upon written notice to the Corporation. The Board of Directors may remove any officer with or without cause at any time, but such removal shall be without prejudice to the contractual rights of such officer, if any, with the corporation. Any number of offices may be held by the same person. Any vacancy occurring in any office of the Corporation by death, resignation, removal or otherwise may be filled for the unexpired portion of the term by the Board of Directors at any regular or special meeting.
Section 4.2 powers and Duties of Executive Officers. The officers of the Corporation shall have such powers and duties in the management of the corporation as may be prescribed by the Board of Directors and, to the extent not so provided as generally pertain to their respective offices, subject to the control of the Board of Directors'. The Board of Directors may require any officer, agent or employee to give security for the faithful performance of their duties.
Section 4.3 Compensation. The salaries of all officers and agents of the Corporation shall be fixed from time to time by the Board of Directors or by a committee appointed or officer designated for such purpose, and no officer shall be prevented from receiving compensation by reason of the fact that he is also a director of the Corporation.
ARTICLE V
Stock
Section 5.1 Certificates. Certificates representing stock in the Corporation shall be signed by or in the name of the corporation by the Chairman or vice Chairman of the Board of Directors, if any, or the President or a vice President, and by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary, of the Corporation, certifying the number of shares owned by them in the corporation. Any or all the signatures on the certificate may be a facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he or she were such officer, transfer agent, or registrar at the date of issue.
Section 5.2 Uncertificated Shares. Subject to any conditions imposed by the Nevada Revised Statutes, the Board of Directors of the corporation may provide by resolution or resolutions that some or all of any or all classes or series of the stock of the corporation shall be uncertificated shares. Within a reasonable time after the issuance or transfer of any uncertificated shares, the Corporation shall send to the registered owner thereof any written notice prescribed by the Nevada Revised Statutes.
Section 5.3 Fractional Share Interests. The Corporation may, but shall not be required to, issue fractions of a share. If the Corporation does not issue fractions of a share, it shall (1) arrange for the disposition of fractional interests by those entitled thereto, (2) pay in cash the fair value of fractions of share as of the time when those entitled to receive such fractions are determined, or (3) issue scrip or warrants in registered form (either represented by a certificate or uncertificated) or bearer form (represented by a certificate) which shall entitle the holder to receive a full share upon the surrender of such scrip or warrant, aggregating a full share. A certificate for a fractional share or an uncertificated fractional share shall, not unless otherwise provided therein, entitle the holder to exercise voting rights, to receive dividends thereon, and to participate in any of the assets of the Corporation in the event of liquidation. The Board of Directors may cause scrip or warrants to be issued subject to the conditions that they shall become void if not exchanged for certificates representing the full shares or uncertificated full shares before a specified date, or subject to the conditions that the shares for which scrip or warrants are exchangeable may be sold by the Corporation and the proceeds thereof distributed to the holders of scrip or warrants, or subject to any other conditions which the Board of Directors may impose.
Section 5.4 Other Regulations. The issue, transfer, replacement, conversion and registration of stock shall be governed by such other regulations as the Board of Directors may establish.
ARTICLE VI
lndemnification
Section 6.1 Right to Indemnification. The Corporation shall indemnify and hold harmless, to the fullest extent permitted by applicable law as it presently exists or may hereafter be amended in a manner more favorable to indemnities, any person (an "Indemnitee") who was or is made or is threatened to be made a party or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "proceeding"), by reason of the fact that he, she, or a person for whom he or she is the legal representative, is or was a director or officer of the Corporation or, while a director or officer of the Corporation, is or is serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust, enterprise or nonprofit entity, including service with respect to employee benefit plans, against all liability and loss suffered and expenses, including attorneys' fees) reasonably incurred by such Indemnitee. Notwithstanding the preceding sentence, except as otherwise provided in Section 6.3, the Corporation shall be required to indemnify an Indemnitee in connection with a proceeding (or part thereof) commenced by such Indemnitee only if the commencement of such proceeding (or part thereof) by the Indemnitee was authorized by the Board of Directors of the Corporation.
Section 6.2 prepayment of Expenses. The Corporation shall pay the expenses (including attorneys' fees) incurred by an lndemnitee in defending any proceeding in advance of its final disposition, provided, however, that, to the extent required by law, such payment of expenses in advance of the final disposition of the proceeding shall be made only upon receipt of an undertaking by the Indemnitee to repay all amounts advanced if it should ultimately be determined that the Indemnitee is not entitled to be indemnified under this Article VI or otherwise; and provided, further, that the Corporation shall not be required to advance any expenses to a person against whom the Corporation directly brings a claim, in a proceeding, alleging that such person has breached their duty of loyalty to the Corporation, committed an act or omission not in good faith or that involves intentional misconduct or a knowing violation of law, or derived an improper personal benefit from a transaction.
Section 6.3 claims. If a claim for indemnification or payment of expenses under this Article VI is not paid in full within sixty (60) days after a written claim therefor by the Indemnitee has been received by the Corporation, the Indemnitee may file suit for the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expense of prosecuting such claim. In any such action the Corporation shall have the burden of proving that the Indemnitee is not entitled to the requested indemnification or payment of expenses under applicable law.
Section 6.4 Nonexclusivity of Rights. The rights conferred on any Indemnitee by this Article VI shall not be exclusive of any other rights which such Indemnitee may have or hereafter acquire under any statute, provision of the Articles of Incorporation, these Bylaws, agreement, vote of stockholders or disinterested directors or otherwise'. Additionally, nothing in this article VI shall limit the ability of the Corporation, in its discretion, to indemnify or advance expenses to persons whom the Corporation is not obligated to indemnify or advance expenses pursuant to this Article VI.
Section 6.5 Other Sources. The Corporations obligation, if any, to indemnify or to advance expenses to any Indemnitee who was or is serving at its request as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, enterprise or nonprofit entity shall be reduced by any amount such Indemnitee may collect as indemnification or advancement of expenses from such other corporation, partnership', joint venture, trust, enterprise or nonprofit enterprise.
Section 6.6 Amendment or Repeal. Any repeal or modification of the foregoing provisions of this Article VI shall not adversely affect any right or protection hereunder of any Indemnitee in respect of any act or omission occurring prior to the time of such repeal or modification.
Section 6.7 Other Indemnification and Prepayment of Expenses. This Article VI shall not limit the right of the Corporation, to the extent and in the manner permitted by law, to indemnify and to advance expenses to persons other than Indemnitees when and as authorized by appropriate corporate action.
Section 6.8 Indemnification contracts. The Board of Directors is authorized to cause the corporation to enter into indemnification contracts with any director, officer, employee or agent of the Corporation, or any person serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, including employee benefit plans, providing indemnification rights to such person. Such rights may be greater than those provided in this Article VI.
Section 6.9 Effect of Amendment. Any amendment, repeal or modification of any provision of this Article VI shall be prospective only, and shall not adversely affect any right or protection conferred on a person pursuant to this Article VI and existing at the time of such amendment, repeal or modification.
Section 6. 10 Insurance. The Corporation may purchase and maintain insurance on behalf of any person who is or was or has agreed to become a director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against them and incurred by them or on their behalf in any such capacity, or arising out of their status as such, whether or not the Corporation
would have the power to indemnify them against such liability under the provisions of this Article VI.
Section 6.11 Savings Clause. If this Article VI or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify each director and officer of the Corporation as to costs, charges and expenses (including attorneys fees), judgments', fines and amounts paid in settlement with respect to any action, suit or proceeding whether civil, criminal, administrative or investigative, including an action by or in the right of the corporation, to the full extent permitted by any applicable portion of this Article VI that shall not have been invalidated and to the full extent permitted by applicable law.
ARTICLE VII
Miscellaneous
Section 7.1 Fiscal year. The fiscal year of the Corporation shall be determined by resolution of the Board of Directors.
Section 7.2 Seal. The corporate seal shall have the name of the corporation inscribed thereon and shall be in such form as may be approved from time to time by the Board of Directors.
Section 7.3 Waiver of Notice of Meetings of Stockholders, Directors and Committees' Any written waiver of notice signed by the person entitled to notice, whether before or after the time stated therein shall be deemed equivalent to notice. Attendance of a person at meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is no lawfully called or convened. The business to be transacted at, nor the purpose of any regular or special meeting of the stockholders, directors, or members of a committee of directors need be specified in any written waiver of notice.
Section 7.4 Interested Directors. Quorum. No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers, or have a financial interest shall be void or voidable solely for this reason or solely because the director or officer is present at or participates in the meeting of the Board or committee thereof which authorizes the contract or transaction, or solely because their votes are counted for such purpose if:
(1) the material facts as to their relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board or committee in good faith authorizes the contract or transaction by the affirmative votes of majority of the disinterested directors, even though the disinterested directors be less than a quorum; or
(2) the material facts as to their relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or
(3) the contract or transaction is fair as to the corporation as of the time it is authorized approved or ratified by the Board of Directors, a committee thereof, or the stockholders. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction.
Section 7.5 Form of Records. Any records maintained by the corporation in the regular course of its business including its stock ledger, books of account, and minute books, may be kept on, or be in the form of any information storage device, provided that the records so kept can be converted into clearly legible form within a reasonable time. The corporation shall so convert any records so kept upon the request of any person entitled to inspect the same.
Section 7.6 Reliance Upon Books and Records. A member of the Board of Directors, or a member of any committee designated by the Board of Directors shall, in the performance of their duties, be fully protected in relying in good faith upon records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of the Corporation's officers or employees or committees of the Board of Directors' or by any other person as to matters the member reasonably believes are within such other person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.
Section 7.7 Articles of Incorporation Govern. ln the event of any conflict between the provisions of the corporation's Articles of Incorporation and these Bylaws, the provisions of the Articles of Incorporation shall govern.
Section 7.8 Severability. lf any provision of these Bylaws 19lI be held to be invali4 illegal, unenforceable or in conflict with the provisions of the Corporation's Articles of Incorporation, then such provision shall nonetheless be enforced to the maximum extent possible consistent with such holding and the remaining provisions of these Bylaws (including without limitation, all portions of any section of these Bylaws containing any such provision held to be invalid, illegal, unenforceable or in conflict with the Articles of Incorporation, that are not themselves invalid, illegal, unenforceable or in conflict with the Articles of Incorporation) shall remain in full force and effect.
Section 7.9 Amendments. Stockholders of the corporation holding a majority of the corporation's outstanding voting stock shall have power to adopt, amend or repeal Bylaws. To the extent provided in the Corporation's Articles of lncorporation, the Board of Directors of the Corporation shall also have the power to adopt, amend or repeal Bylaws of the Corporation, except insofar as Bylaws adopted by the stockholders shall otherwise provide.
I DO HEREBY CERTIFY;
That the forgoing Bylaws were adopted as the BYLAWS of PERKINS OIL & GAS INC. as of May 28, 2012.
/s/ J Michael Page ----------------------------- J. Michael Page, Secretary |
Exhibit 5.1
Kevin M. Murphy Attorney at Law 6402 Scott Lane Pearland, Texas 77581 (281) 804-1174 info@kevinmurphylaw.com
January 30, 2013
Mr. J. Michael Page, President
Perkins Oil & Gas, Inc.
1445 Marpole Avenue #409
Vancouver, BC V6H 1S5
Re: Perkins Oil & Gas, Inc., Form S-1 Registration Statement
Mr. Page:
I refer to the above-captioned registration statement on Form S-1 ("Registration Statement") under the Securities Act of 1933, as amended ( "Act"), filed by Perkins Oil & Gas, Inc., a Nevada Corporation ("Company"), with the Securities and Exchange Commission. The Registration Statement related to the offering of 5,000,000 shares of the Company's common stock ("Common Stock"). Such shares are to be issued under the Registration Statement and the relating prospectus to be filed with the Commission. The details of the offering are described in the Registration Statement on Form S-1.
I have examined the copies of such records of the Company, certificates of officers of the Company, as a basis for the opinion hereinafter expressed. In such examination, I have assumed the genuineness of all signatures, the authenticity of all documents submitted to me as certified copies or photocopies and the authenticity of the originals of such documents. Based on my examination mentioned above, I am of the opinion that 5,000,000 shares of common stock to be offered and sold are duly authorized shares of common stock will, when sold, be legally issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion as an Exhibit to the Registration Statement and to the reference to my firm under "Interest of Named Experts and Counsel" in the Registration Statement.
Sincerely,
/s/ Kevin M. Murphy ---------------------------- Kevin M. Murphy |
Exhibit 10.1
OIL, GAS AND MINERAL LEASE
This Agreement executed and effective on this 20th day of October, 2011, by and between
Wade Perkins, husband of Rachel B Perkins, whose address is 504 Elm St, Bustrap,
LA 71220
Maxwell Savage III, husband of Shirley P Savage, whose address is 627 Woodlake, Commorue, LA 71419
Charles R. Perkins, husband of Doris A Perkins, whose address is 487 Macarthur Loop, Cotton Valley, LA 71018
as Lessors (whether one or more) and Lanza Land Management, LLC, a Louisiana Liability Company, whose mailing address is Box 458, Oil City, LA 71061 as Lessee.
WITNESSETH:
LESSOR in consideration of TEN DOLLARS ($10.00) AND OTHER GOOD AND VALUABLE CONSIDERATIONS of the royalties herein provided, and of the agreement of Lessee herein contained, hereby grants, leases and lets exclusively unto LESSEE for the purposes of investigating, prospecting, drilling, mining and exploring (including the exclusive right to conduct geophysical/seismic operations and other related activities) for and producing oil, gas and all other minerals, laying pipe lines, building drill sites, access roads, tanks, power stations, telephone lines and all other structures thereon to produce, save, take care of, treat, transport and own said products and for dredging and maintaining canals, constructing roads and bridges, and building houses for its employees, and in general, for all appliances, structures, equipment, servitudes and privileges which may be necessary, useful or convenient to or in connection with any operations conducted by LESSEE thereon, or on any lands pooled therewith, the following described land in Webster Parish, Louisiana, to wit:
Begin at the point where the North line of the Porterville-Sikes Ferry Road intersects the West line of the West Half of the Southeast Quarter of the Northeast Quarter (W/2 of SE/4 of NE/4), Section 36, Township 23 North, Range 11 West, thence run in an easterly direction along the North line of said road 190 feet, thence run North 380 feet, thence run West 285 feet to the West line of said W/2 of SE/4, thence run South 345 feet to the point of beginning, Webster Parish, Louisiana.
The above tracts comprising 3.00 acres, more or less, in the aggregate.
Lessee hereby promises to demolish and remove vacant house located on said property.
This lease shall also extend and apply to any interest in the lands described herein which Lessor may hereafter acquire, including, but not limited to, outstanding mineral rights acquired by reversion, prescription or otherwise.
This lease also covers and includes any other land owned by the Lessor in the above mentioned Section or Sections, all property acquired by prescription and all accretion or alluvion attaching to or forming a part of said land; as well as any interest in any streets, alleys, lanee, roads, streams, bayous, railroads, ditches, canals or other rights-of-way, public, private or abandoned, adjoining or traversing the lands described herein, whether or not specifically described or not. Whether or not and reduction in payment shall have previously been made, this lease, without further evidence thereof, shall immediately attach to and effect any and all rights, titles and interest in the above described land, including reversion mineral rights, hereinafter acquired by or inuring to Lessor and Lessor's successors and assigns.
For the purposes hereof, the land described herein is estimated to comprise 3.00 acres, whether it actually comprises more or less.
2. Subject to the other provisions herein contained, this lease shall be for a period of two (2) years from this date(called "primary term") as (1) oil, gas, sulphur or other minerals is being produced from said land hereunder of from land pooled therewith; Or (2) it is maintained in force in any other manner herein provided.
3. For the consideration herein above recited, this lease shall remain in full force and effect during the primary term, without any additional payment and without Lessee being required to conduct any operations of the land (either before or after the discovery of minerals), except to drill such wells as might be necessary to protect the land from drainage, as hereinafter provided.
4. The royalties paid by Lessee are: (a.) on oil, and other hydrocarbons which are produced at the well in liquid form by ordinary production methods, Eighteen and seventy-fifths (18.75%) (3/16) of that produced and saved from said land, same to be delivered at the wells or to the credit of the Lessor in the pipeline to which he wells may be connected; Lessors interest in either case will not bear is proportion of any expenses for treating oil to make it marketable as crude; Lessee may from time to time purchase any royalty oil or other liquid hydrocarbons in its possession, paying the market price therefore prevailing for the field where produced on the date of the purchase; (b) on gas, including casing head gas, or other gaseous substance produced from said land and sold or used off the premises or for the extraction of gasoline or other products therefrom the market value at the well of Eighteen and seventy-fifths (18.75%) (3/16) of the gas so sold or used, provided that on gas sold at the wells the royalty shall be Eighteen and seventy-fifths (18.75%) (3/16) of the amount realized from such sale; such gas, casinghead gas, residue gas or gas of any other nature or description whatsoever, as may be disposed of for no consideration to Lessee, either through unavoidable waster or leakage, or in order to recover oil or other liquid hydrocarbons, or return to the ground shall not be deemed to have been sold or used either on or off the premises within the meaning of this paragraph 3 hereof; (c) on all other minerals mined and marketed, Eighteen and seventy-fifths (18.75%) (3/16) either in kind or value at the well or mine, at Lessees election, except that on sulphur the royalty shall be one (1) dollar per ton.
5. If Lessee during or after the primary term should drill a well capable of producing gas or gaseous substance in paying quantities, (or which all although previously produced Lessee is unable to continue to produce) and should Lessee be unable to operate said well because of lake or market or marketing facilities or governmental restrictions, then Lessees rights may be maintained beyond or after the primary term without production of minerals for further drilling operations by paying Lessor as royalty ONE AND NO/100 ($1.00/acre) DOLLAR per acre per year, the first payment being due, if said well should be completed or shut-in after the primary term, within ninety (90) days after completion of such well or cessation of production and such payment will extend Lessees rights from one year from date of such completion or cessation. If such a well should be completed during the primary term, the first payment, if made by Lessee, shall be due on or before the expiration date of the primary term herein fixed. Thereafter Lessees rights may be continued from year to year by making annual payments in the amount stated on or before the end of the primary term as the case may be; each of such payments to extend to Lessees rights for one year. It is provided, however, that in no event shall Lessees rights be so extended by annual payments herein fixed without drilling operations or the production of oil, gas or some other minerals for more than five (5) years beyond the end of the primary term hereinabove fixed. The annual payments herein provided for may be deposited to Lessors credit in the Pay Direct to Lessor at Address Above which bank shall be and remain Lessors agent for such purpose regardless of any change or changes of ownership of the land or mineral rights therein or Lessee may directly send said annual payments to Lessor at the address shown above, or until Lessor notifies Lessee otherwise. It is the responsibility of Lessor to inform Lessee of any change of ownership of land and minerals which would affect payment of annual payments as herein provided to Lessor; if Lessor fails to notify Lessee of said change and Lessee pays annual payments to Lessor it is agreed that Lessor should forward said payments to the rightful mineral owner, and Lessee is held harmless for the same, and paying Lessor would be the same as paying other mineral owners. The owners of the royalty as of the date of such payment shall be entitled thereto in proportion to their ownership of said royalty. The provisions of this paragraph shall be recurring at all times during the life of this lease. Should any well producing gas or gaseous substances be completed on a drilling unit which includes any part of the lands herein leased, the provisions of this paragraph should be subject to all other agreements herein contained allowing the pooling of the above described lands with other lands.
6. If within ninety (90) days prior to the end of the primary term, Lessee should complete or abandoned a dry hole or holes on the land described above or on land pooled therewith, or if production previously secured should cease from any cause, this lease shall continue in full force and effect for ninety (90) days from such completion or abandonment or cessation of production. If at the expirations of the primary term or at the expiration of the ninety (90) provided for in the preceding sentence, oil, gas, sulphur or other minerals is not being produced on said land or on land pooled therewith, but Lessee is engaged in operations for drilling or reworking thereon, or if production previously
secured should cease from any cause after the expiration of the primary term, this lease shall remain in full force and the fact so long as and thereafter as Lessee either (a) is engaged in operations for drilling or reworking or repairing said wells with no cessation between operations or between such cessation of production and additional operations of more than ninety (90) consecutive days; or (b) is producing oil, gas, sulphur or other minerals from said land hereunder or from land pooled therewith. If sulphur be encountered on said premises or on land pooled therewith, this lease shall continue in force and effect so long as Lessee is engaged with due diligence in explorations for and/or erecting a plant for sulphur and thereafter subject to the foregoing provisions here of so long as oil, gas, sulphur or other minerals is produced from said lands hereunder or from lands pooled therewith.
7. Lessee is hereby granted the right as to all or part of the land
described herein without Lessors joinder, to combine, pool or utilize the
acreage royalty or mineral interest covered by the lease, or any portion
thereon, with any other land, lease or leases, royalty or mineral interests and
or under any other tracts of land in the vicinity thereon, whether owned by
Lessee or some other person, or corporation, so as to create, but a combination
of such lands, and leases, one or more operating units, provided that no one
operating said unit shall, in the case of gas, including condensate, embrace
more than six hundred and forty (640) acres, and in the case of oil including
casinghead gas, embrace more than forty (40) acres; and provided further,
however, that if any spacing or other rules and regulations of the state or
Federal Commission Agency or regulatory body having or claiming jurisdiction has
heretofore or shall at time here after prescribe a drilling or operating unit or
spacing rule in the case of gas, including condensate, greater than six hundred
forty (640) acres, or in the case of oil or casinghead gas greater than forty
(40) acres, then the unit or units herein contemplated may have, or maybe
redesigned so as to have, as the case may be, the same surface content as, but
not more than, the unit or acreage in the spacing rules so prescribed. However,
it is further specifically understood and agreed anything herein to the contrary
notwithstanding, that the Lessee shall have the right to, and the benefit of in
acreage tolerance of ten per cent in excess of any drilling or operating unit
authorized herein. The commencement of a well, or the completion of a well to
production of either oil, gas, casinghead gas, condensate or other minerals on
any portion of the operation unit in which all or any part of the land described
herein is embraced, or production of oil, gas, casinghead gas, condensate, or
other minerals therefrom shall have the same effect under the terms of this
lease as if a well were commenced completed for producing oil, gas, casinghead
gas, condensate or other minerals in paying qualities on the land in braced by
this lease. Lessee shall execute in writing and file for record in the records
of the Parish in which the lands herein leased are located, an instrument
identifying or be scrapping the pooled acreage, or an instrument supplemental
thereon redesignating same, as the case may be. Either prior to the securing of
production from any unit created under the authority hereinabove granted, or
after cessation of production therefrom Lessee shall have the right to dissolve
the unit so created without lessors joiner or further consent, by executing in
writing and placing of record in Parish or Parishes on which the land making up
such unit may be located, an instrument identifying and resolving such units.
The provision hereto shall be construed as a covenant running with the land and
shall inure to the benefit of and are binding upon the parties hereto, their
heirs, representatives, successors and assigns. In the event such operating unit
or units is/are created by Lessee, Lessor shall receive out of production of the
proceeds from the production from such operating unit or units or out of the
shut-in royalty provided above, subject to the provisions of Paragraph 8, such
portion of the royalty or the shut-in royalty specified herein as the number of
acres (mineral acres) out of this lease placed in any such operating unit or
units bears to the total number of acres including in such operating unit or
units.
8. If Lessor owns a less interest in the above described land than the entire and undivided fee simple estate therein, then the royalties herein provided shall be paid to Lessor only in the proportion which Lessors interest bears to the whole undivided fee.
9. Lessee shall have free use of oil, gas, casinghead gas, condensate, coal and water from said land, except water from Lessor wells, for all operations hereunder, including repressuring, pressure maintenance and recycling, and the royalty shall be computed after deducting any so used. Lessee shall have the right at any time during or after the expiration of this lease to remove all property and fixtures placed by Lessee on said land, including the right to draw and remove all casing. When required by Lessor, Lessee will bury all pipelines below ordinary plow depth, and no well shall be drilled within two hundred feet of any residence or barn now on said land, without Lessors consent. In the event a well or wells, producing oil, gas, casinghead gas or condensate in paying quantities should be brought in on adjacent lands not owned by Lessor and within one hundred fifty feet of leased premises, Lessee may or may not (at Lessees option) drill a well to offset same.
10. The rights of either party hereunder may be assigned in whole or part and the provisions hereof shall extend to the heirs, executors, administrators, successors and assigns, but no change or division of ownership of the land, rentals, or royalties, however accomplished shall operate to enlarge the obligations or diminish the rights of Lessee. No such change for division in the ownership of the land, rentals or royalties shall be binding upon Lessee for any purpose until such person acquiring an interest has furnished Lessee, Lessees heirs or assigns, at its principle place of business, or recorded copy of the instrument or instrument, constituting his chain of title from the original Lessor. In the event of an assignment of this lease as to a segregated portion of said land, or as to an undivided interest therein, the rental payable hereunder shall be apportioned as between the several leasehold owners ratable according to the surface area of each, or according to the undivided interest of each, and default and rental payment by one shall not affect the rights of the other leasehold owners hereunder. An assignment if this lease, in whole or part, shall, to the extent of such assignment, relieved and discharge Lessee of any obligations hereunder and if Lessee or assignee of parts or parts here on shall fail or make default in the payment of the proportionate part of the rentals due from such Lessee, or assignee, or fail to comply with any other provisions of the lease, such default shall not affect this lease insofar as it covers a part of said lands upon which lessee or any assignee thereof shall make payment of said rental.
11. In the case of suit, adverse claim, dispute or question as to the ownership of the rentals or royalties (or some part thereof) payable under this lease, Lessee shall not be held in default in payment of such rentals or royalties (or part thereof in dispute) until such suit, claim, dispute for question has been finally disposed of, and Lessee, shall have thirty (30) days after being furnished with a certified copy of the instrument or instruments disposing said suit, claim or dispute, or after being furnished with proof sufficient, in Lessees opinion, to settle such questions, within which to make payment. Should the rights or interests of Lessee hereunder be disputed by Lessor, or any other person, the time covered by the pendency of such dispute shall not be counted against Lessee either as affecting the term of the lease or for any other purpose, and Lessee may suspend all payments without interest until there's a final adjudication or other determination of such dispute.
12. In case of cancellation or termination of this lease from any cause, Lessee shall have the right to retain, under the terms here of, around each well producing, being worked on, or drilling hereunder, the number of acres in the form of allocated to each such wells under spacing and proration rules by the Commissioner of Conservation of the state of Louisiana or Federal Authority having control of such matters; or, in the absence of such ruling forty (40) acres around each well in as near as square form as practicable, and in the event Lessor considers that operations are not being conducted in compliance with this contract, Lessee shall be notified in writing of the facts relied upon as constituting a breach hereof and Lessee shall have sixty (60) days after the receipt of such notice to comply with the obligations imposed by virtue of this instrument. Upon receipt of Lessors written notice to Lessee, if Lessee fails to respond to notice of breach or to comply with said notice, all all rights to said lease shall Ipso fact revert back to the Lessor, his heirs and assigns.
13. When drilling, reworking, production or other operations are delayed or interrupted by force majeure, that is, by storm, flood or other acts of God, fire, war, rebellion, insurrection, riot, strikes, difference with workmen, or failure of carriers to transport or furnish facilities for transportation, or as a result of some law, order, rule, regulation, requisition or necessity of the government, Federal or State, or as a result of any cause whatsoever beyond the control of Lessee, the time of such delay or interruption shall not be counted against Lessee, anything in this lease to the contrary notwithstanding, but this lease shall be extended for a period of time equal to that during which Lessee is so prevented from conducting such drilling or reworking operations or, or producing oil, gas, casinghead gas, condensate or other minerals from the premises; provided that during any period that this lease is continued in force after its primary term solely by force majeure as herein provided; Lessee shall pay to the owners of the royalty hereunder the shut-in royalty provided in paragraph 5 hereof, and in the manner therein provided, without regard to whether or not there is a producing well shut-in, located on said land or on land with which the lease premises or any part thereof has been pooled.
14. It is expressly understood and agreed that the premises leased herein shall, for all purposes of this lease, be considered and treated as owned in indivision by the Lessor and shall be developed and operated as one lease, and there shall be no obligation on the part of Lessee to offset wells on separate tracts into which the land covered by this lease may be now or hereafter divided by sale, or otherwise, or to furnish separate measuring or receiving tanks and all rentals, royalties and other payments accruing hereunder shall be treated as an entirety and shall be divided amount and paid to Lessor in the proportion
that the acreage (mineral rights) owned by each bears to the entire leased acreage. Lessee may at any time or times pay or tender all sums accruing hereunder to the joint credit of Lessor.
15. Notwithstanding the death of any party Lessor, or his successor in interest, the payment or tender of all sums accruing hereunder in the manner provided above shall be binding on the heirs, executors, and administrators of such person.
16. Lessor hereby warrants title to said lands described herein and agrees to defend title to said land, and agrees Lessee at its option shall have the right to redeem for Lessor, by payment, any mortgage, taxes or other liens on the above described lands, in the event of default of payment by Lessor, and be subrogated to the rights of the holder hereof. In the case of payment by Lessee of any such mortgage, taxes or other liens owed by Lessor in addition to the rights of subrogation herein granted, Lessee shall have the right to retain any royalties which become due Lessor hereunder and to repay itself therefrom, and the retention of such royalties by Lessee shall have the same effect as if paid to the Lessor in whose behalf payment of any mortgage, taxes or other liens was made. In the event the leased lands are encumbered by a mortgage, then prior to the payment of any royalties due hereunder, Lessor agrees to obtain a subordination of mortgage, at Lessor's expense, in a form acceptable to Lessee.
17. Lessee shall pay for actual damages caused by its operations to growing crops and timber on said land leased herein. Lessor specifically agrees that the obligations and liabilities of the Lessee and its successors and assigns for redemption, restoration, repair or maintenance of the surface or subsurface of the leased premises shall never exceed the fair market value (determined as of the effective date hereof) of the land covered by this lease, or the portion thereof, for which such reclamation, restoration, repair or maintenance is required.
18. In the event that the Lessor, during the primary term of this lease, receives a bona fide offer which Lessor is willing to accept from any party offering to purchase from Lessor a lease covering any or all of the substances covered by this lease and covering all or a portion of the land described herein, with the lease becoming effective upon expiration of this lease, Lessor hereby agrees to notify Lessee in writing of said offer immediately, including in the notice the name and address of the offeror, the price offered, and all other pertinent terms and conditions of the offer. Lessee, for a period of fifteen days after receipt of the notice, shall have the prior and preferred right and option to purchase the lease or part thereof or interested therein, covered by the offer at the price and according to the terms and conditions specified in the offer.
19. This lease shall be binding upon all who execute it, whether or not named in the body hereof as Lessor and without regard to whether this instrument, or any copy thereof, shall be executed by any other Lessor named above.
20. For the same consideration recited above, Lessor hereby grants, assigns and conveys to the Lessee, its successors and assigns, a perpetual subsurface well bore easement under and through the leased premises for the placement of well bores (along routes selected by the Lessee) from oil and or gas wells the surface locations of which are situated on other tracts of land not covered hereby and which are not intended to develop the leased premises or lands pooled therewith and from which Lessor shall have no right to royalty or other benefit. Such subsurface well bore assignments shall run with the land and survive any termination of this lease.
21. DISCLAIMER OF REPRESENTATIONS: Lessor acknowledges that oil and gas lease payments, including but not limited to bonus and royalty, are market sensitive and may vary depending on multiple factors and that this Lease is the product of good faith negotiations. Lessor understands that these lease payments and terms are final and that Lessor entered into this lease without duress or undue influence. Lessor recognizes that lease values could go up or down depending on market conditions. Lessor acknowledges that no representations or assurances were made in the negotiation of this lease that Lessor would get the highest price or different terms which Lessee has or may negotiate with any other lessor/oil and gas owners.
IN WITNESS WHEREOF, this instrument is executed effective as of the date first above written.
WITNESSES:
Sign: /s/ Robert Mik /s/ Wade W. Perkins
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Print: Robert Mik Wade W. Perkins
Sign: /s/ Robert Mik /s/ Rachel B. Perkins
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Print: Robert Mik Rachel B. Perkins
Sign: /s/ Robert Mik /s/ Maxwell Savage III
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Print: Robert Mik Maxwell Savage III
Sign: /s/ Robert Mik /s/ Shirley P. Savage
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Print: Robert Mik Shirley P. Savage
Sign: /s/ Robert Mik /s/ Charles R. Perkins
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Print: Robert Mik Charles R. Perkins
Sign: /s/ Robert Mik /s/ Doris A. Perkins
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Print: Robert Mik Doris A. Perkins
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Exhibit 10.2
STATE OF LOUISIANA
PARISH OF WEBSTER
ASSIGNMENT
Lanza Land Management, LLC, a Louisiana Limited Liability Company, whose mailing address is P.O. Box 458, Oil City, LA 71061
Hereinafter referred to as ASSIGNOR, (whether one or more) declared that they do by these present, sell, assign, transfer, convey and deliver unto:
Perkins Oil & Gas, Inc., a Nevada corporation, herein represented by J. Michael Page, President and duly authorized, its mailing address of 1445 Marpole Avenue #409, Vancouver, BC V6H 1S5 Canada, hereinafter referred to as ASSIGNEE(S) (whether one or more).
No liens, encumbrances or compliance order violations exist on the attached listed leases.
This instrument is to assign a 25.00% Working Interest and a 18.75% Net Revenue Interest in the lease more property described in the attached Exhibit "A".
The consideration for this assignment is for the sum of TEN AND NO/100 ($10.00 USD) US DOLLARS and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged.
Assignees accept the said leases, wells and equipment in AS IS WHERE IS condition and WITHOUT WARRANTY either expressed or implied even to the return of purchase price.
Assignee shall comply with and does hereby assume and agree to perform Assignee's proportionate part of all expenses and implied covenants, obligations and reservations contained in this Lease, and the interest assigned herein are subject to and shall bear their proportionate shares of all existing burdens of the Lease.
These leases are made subject to all rights-of-way or easements; also, and all outstanding terms and conditions that are expressed in those conveyances of record affecting said leases and properties.
This assignment is effective May 31, 2012.
It is acknowledged that said Notary Public has not examined title and cannot be held responsible for any defects on might reveal by said examination of
conveyance and mortgages or record. All information used herein was provided to said Notary Public by said parties.
IN WITNESS WHEREOF, this instrument is signed on this 9th day of July, 2012, in the presence of the undersigned witness and me, Notary Public, after reading of the whole.
WITNESSES: ASSIGNOR:
/s/ J /s/ Mario Lanza
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Mario Lanza, Manager
Lanza Land Management, LLC
/s/ D Lanza /s/ Thomas Andrew Paul
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Notary Public
I.D. #004379
My Commission Is For Life
WITNESSES: ASSIGNEE:
/s/ MM /s/ J Michael Page
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J Michael Page
Perkins Oil & Gas, Inc.
/s/ David Parkes
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David Parkes
Barrister & Solicitor
460-2509 Granville St
Vancouver, BC V6H 3H3
604-734-6838
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Exhibit A
The following described oil, gas and mineral lease is referenced to as "Perkins Lease".
Begin at the point where the North line of the Porterville-Sikes Ferry Road intersects the West line of the West Half of the Southeast Quarter of the Northeast Quarter (W/2 of SE/4 of NE/4), Section 36, Township 23 North, Range 11 West, thence run in an easterly direction along the North line of said road 190 feet, thence run North 380 feet, thence run West 285 feet to the West line of said W/2 of SE/4, thence run South 345 feet to the point of beginning, Webster Parish, Louisiana.
The above tracts comprising 3.00 acres, more or less, in the aggregate.
Exhibit 10.3
OPERATING AGREEMENT
THIS AGREEMENT, made this 15th day of August, 2012, between Four Star Oil, hereinafter designated as "Operator", and the signatory party or parties other than the Operator, hereinafter designated as "Non-Operator" or "Non-Operators."
WITNESSETH:
WHEREAS, the parties to this Agreement are owners of interests in that certain production/proration unit for the well (the "Well") on the Perkins lease, located in Webster Parish, Louisiana, reached an agreement to develop the Unit and operate the Wells as hereinafter provided.
1. Definitions
As used in this Agreement, the following words and terms shall have the meanings here ascribed to them.
A. The words "party" and "parties" shall always mean a party or the parties to this Agreement.
B. The parties to this Agreement shall always be referred to as "it" or "they" whether the parties be corporate bodies, partnerships, associations, or individuals.
C. The term "oil and gas" shall include oil, gas, casinghead gas, gas condensate, and all other liquid or gaseous hydrocarbons, unless intent to limit the inclusiveness of this term is specially stated.
D. The term "oil and gas interests" shall mean unleased fee and mineral interests in tracts of land lying within the Unit or Area of Interest that are owned by the parties to this Agreement.
E. The term "Unit Area" shall refer to and include all of the lands, oil and gas leasehold interests and oil and gas interests intended to be developed and operated for oil and/or gas purposes under this Agreement. Such lands are described in Exhibit A.
F. The words "equipment" and "materials" as used here are synonymous and shall mean and include all oil field supplies and personal property acquired for use in the Unit Area.
All exhibits attached to this Agreement are made a part of the contract as fully as though copied in full in the contract.
2. Title Examination
A. TITLE EXAMINATION: If required, all abstracts and title shall be examined for the benefit of all parties by Operator's attorneys. A copy of each title opinion and of each supplemental opinion, if needed, and all final opinions shall be sent promptly to each party at their request. The opinion of the Operator's attorney concerning the validity of the title to each oil and gas interest and each lease, and the amount of interest covered thereby shall be binding and conclusive on the parties, but the acceptability of leases as to primary term, royalty provisions, drilling obligations and special burdens, shall be a matter for approval and acceptance by an authorized representative of each party. Each party shall pay his pro rata share of any legal fees incurred by Operator relating to preparation of title opinions, supplemental opinions and final opinions.
B. FAILURE OF TITLE: Any defects of title that may develop shall be the joint responsibility of all parties and, if a title loss occurs, it shall be the loss of all parties, with each bearing its proportionate part of the loss and of any liabilities incurred in the loss. If such a loss occurs, there shall be no change in, or adjustment of, the interests of the parties in the remaining portion of the Unit Area or Area of Interest.
C. LOSS OF LEASES FOR OTHER THAN TITLE FAILURE: If any lease or interest subject to this Agreement be lost through failure to develop or because express or implied covenants have not been performed, or if any lease be permitted to expire at the end of its primary term and not be renewed or extended, the loss shall not be considered a failure of title and all such losses shall be joint losses and shall be borne by all parties in proportion to their interests, and there shall be readjustment of interests in the remaining portion of the Unit Area.
3. Interests of Parties
Unless changed by other provisions, all costs and liabilities incurred in operations under this contract shall be borne and paid proportionally and all equipment and material acquired in operations on the Unit Area shall be owned by the parties as their respective interests bear to the entire leasehold. All production of oil and gas from the Unit Area shall also be owned by the parties in the same manner subject to all royalties overriding royalties and production payments in the nature of an overriding royalty.
4. Operator of Unit
Four Star Oil shall be the Operator of the Unit Area and shall conduct and direct and have full control of all operations on the Unit Area as permitted and required by and within the limits of this Agreement. It shall conduct all such operations in a good and workmanlike manner, but it shall not have responsibility for liabilities incurred, except as may result from gross negligence or from breach of the provisions of this Agreement.
5. Distribution of Revenue to Participants
The Operator will collect all working interest owners' oil and gas revenue and deduct there from the cost of operating and maintaining the oil and gas properties. The remainder will then be distributed to each working interest owner monthly, proportionate to his working interest ownership in the oil and gas properties covered by this Agreement, notwithstanding any other provision to the contrary in this Agreement.
6. Employees
The number of employees and their selection and the hours of labor and the compensation for services performed shall be determined by the Operator. All employees shall be the employees of the Operator.
7. Costs and Expenses
Except as herein otherwise specifically provided, Operator shall promptly pay and discharge all costs and expenses incurred in the development and operation of the Unit Area, pursuant to this Agreement, and shall charge each of the parties hereto with their respective proportionate shares upon the cost and expenses basis provided in the Accounting Procedure attached hereto and marked Exhibit Two. If any provision in Exhibit Two should be inconsistent with any provision contained in the body of this Agreement, the provisions in the body of this Agreement shall prevail.
Operator, at its election, shall have the right from time to time to demand and receive from the other parties payment in advance of their respective shares of the estimated amount of costs to be incurred in operations hereunder during the next succeeding month, which right may be exercised only by submission to each such party of an itemized statement of such estimated costs, together with an invoice for its share thereof. Each such statement and invoice for the payment in advance of estimated costs shall be submitted on or before the 20th day of the next preceding month. Each party shall pay to Operator its proportionate share of such estimate within fifteen (15) days after such estimate and invoice is received. If any party fails to pay its share of said estimate within this time, the amount due shall bear interest at the rate of ten percent (10%) per annum until paid. Proper adjustment shall be made monthly between advances and actual cost to the end that each party shall bear and pay its proportionate share of actual costs incurred, and no more. Operator has the right to charge up to a 300% penalty if funds are not paid.
Without the consent of all parties, Operator shall not undertake any single project reasonably estimated to require an expenditure in excess of Fifteen Thousand Dollars ($15,000), except in connection with maintaining a lease, the drilling, reworking, deepening, completing, recompleting, or plugging back of which has been previously authorized by or pursuant to this Agreement; provided, however, that in case of explosion, fire, flood, or other sudden emergency, whether of the same or different nature, Operator may take such steps and incur such expenses as in its emergency to safeguard life or property, but Operator, as promptly as possible, shall report the emergency to the other parties.
8. Operator's Lien
Operator is given a first and preferred lien on the interest of each party covered by this contract, and on each party's interest in oil and gas produced and the proceeds thereof, and upon each party's interest in material and equipment, to secure the payment of all sums due from each such party to Operator.
In the event any party fails to pay any amount owing by it to Operator as its share of such costs and expenses or such advance estimate, Operator shall, as promptly as possible, report the emergency to the other parties.
If all parties hereto cannot mutually agree upon the drilling, reworking, deepening or redrilling of any well or wells covered by this Agreement and jointly owned by all of the parties, any party or parties wishing to drill, rework, redrill, or deepen such a well or wells may give the other parties written notice of the proposed operations specifying the work to be performed, proposed depth, objective formation and the estimated cost of the operation. The parties receiving such a notice shall have ten (10) days after receipt of the notice within which to notify the parties wishing to do the work whether they elect to participate in the cost of the proposed operation. Failure of a party receiving such a notice to so reply to it within the period above fixed shall constitute an election by that party not to participate in the cost of the proposed operations.
The entire cost and risk of conducting such operations shall be borne by the parties electing to participate in the proposed operation, such parties hereinafter referred to as "consenting parties" in the proportion that their respective interests bear to the total interest of all consenting parties. Consenting parties shall keep the leasehold estate involved in such operations free and clear of all liens and encumbrances of every kind created by or arising from the operations of the consenting parties. If such an operation results in a dry hole, the consenting parties shall plug and abandon the well at their sole cost, risk and expense. If any well drilled, reworked, deepened or redrilled under the provisions of this section results in a producer of oil and/or gas in paying quantities, the consenting parties shall complete and equip the well to produce at their sole cost and risk, and the well shall then be turned over to the Operator and shall be operated by it at the expense and for the account of the consenting parties. Upon commencement of operations for the drilling, reworking, deepening, or redrilling of any such well by consenting parties in accordance with the provisions of this section, each non-consenting party shall be deemed to have relinquished to consenting parties, and the consenting parties shall own and be entitled to receive, in proportion to their respective interest, all of such non-consenting party's interest in the well, its leasehold operating rights and share of production therefrom until the proceeds or market value thereof (after deducting production taxes, royalty, overriding royalty and other interests payable out of or measured by the production from such well accruing with respect to such interest until it reverts) shall equal the total of the following:
A. 500 percent of each non-consenting party's share of newly acquired surface equipment beyond the wellhead connections (including, but not limited to, stock tanks, separators, treaters, pumping equipment and piping), plus 300 percent of each such non-consenting party's share of
the cost of operation of the well commencing with first production and continuing until each such non-consenting party's relinquished interest shall revert to it under other provisions of this section. It being agreed that each non-consenting party's share of which would have been chargeable to each non-consenting party had it participated in the well from the beginning of the operation; and
B. 500 percent of that portion of the costs and expenses of drilling, reworking, deepening or redrilling, testing and completing, and 500 percent of that portion of the cost of newly acquired equipment in the well (to and including the well-head-connections) which would have been chargeable to such non-consenting party if it had participated therein.
In the case of any reworking, plugging back, or deeper drilling operation, the consenting parties shall be permitted to use, free of cost, all casing, tubing and other equipment in the well; but the ownership of all such equipment shall remain unchanged and upon abandonment of a well after such reworking, plugging back or deeper drilling, the consenting parties shall account for all such equipment to the owners thereof, with each party receiving its proportionate part in kind or in value.
If and when the consenting parties recover from a non-consenting party's relinquished interest the amount provided for above, the relinquished interest of such non-consenting party shall automatically revert to it, and from and after such reversion, such non-consenting party shall own the same interest in such well, the operating rights and working interest therein, the material and equipment in or pertaining thereto, and the production therefrom as such non-consenting party would have owned had it participated in the drilling, reworking, deepening or redrilling of said well. Thereafter, such non-consenting party shall be charged with and shall pay its proportionate part of the further costs of the operation of said well in accordance with the terms of this Agreement and the accounting procedure schedule, Exhibit Two, attached hereto.
9. Right to Take Production In Kind
Each party shall take in kind or separately dispose of its proportionate share of all oil and gas produced from the Unit Area, exclusive of production, which may be used in developing, and production operations unavoidably lost. Each party shall pay or deliver, or cause to be paid or delivered, all royalties, overriding royalties, or other payments due on its share of such production, and shall hold the other parties free from any liability therefrom. Any extra expenditure incurred in the taking in kind or separate disposition by any party of its proportionate share of the production shall be borne by such party.
Each party shall execute all division orders and contracts of sale pertaining to its interest in production from the Unit Area, and agrees that Operator shall receive all production proceeds and disburse proceeds to participants monthly. Operator is authorized to deduct expenses and charges as authorized in this Agreement from such proceeds and send the remaining amount to participants.
In the event any party shall fail to make the arrangements necessary to take in kind or separately dispose of its proportionate share of the oil and gas produced from the Unit Area, Operator shall have the right, but not the obligation, to purchase such oil and gas or sell it to others for the time being, at not less than the market price prevailing in the area, which shall in no event be less than the price which Operator receives for its portion of the oil and gas produced in the Unit Area. Any such purchase or sale by Operator shall be subject always to the right of the owner of the production to exercise at any time its right to take in kind, or separately dispose of, its share of all oil and gas not previously delivered to a purchaser.
Notwithstanding the foregoing, Operator shall not make a sale into interstate commerce of any other party's share of gas production without first giving such other party thirty (30) days' notice of such intended sale.
10. Access to Unit Area
Each party shall have access to Unit Area at all reasonable times, at its sole risk, to inspect or observe operations, and shall have access at reasonable times to information pertaining to the development or operation thereof, not including Operator's books and records relating thereto. Operator shall, upon request, furnish each of the logs, tank tables, daily gauges and run tickets, and reports of stock on hand at the first of each month, and shall make available samples of any cores or cuttings taken from any well drilled on the Unit Area.
11. Abandonment of Wells
No well subject to and the basis of this Agreement which has been completed as a producer shall be plugged and abandoned without the consent of all parties provided, however, if all parties do not agree to the abandonment of any well, those wishing to continue its operation shall tender to each of the other parties its proportionate share of the value of the well's salvageable material and equipment, determined in accordance with the provisions of Exhibit Two less the estimated cost of salvaging and the estimated cost of plugging and abandoning. Each abandoning party shall then assign to the non-abandoning parties without warranty, express or implied, as to title or as to quantity, quality, or fitness for use of the equipment, together with its interest in the leasehold estate as to, but only as to, the interval or intervals of the formation or formations then open to production. The assignments so limited shall encompass the "drilling unit" upon which that well is located. The payments by, and the assignments to, the assignees shall be made in accordance with their respective percentages of participation in the Unit Area of all assignees. There shall be no readjustment of interest in the remaining portion of the Unit Area.
After the assignment, the assignors shall have no further responsibility, liability, or interest in the operation of or production from that well in the interval or intervals then open. Upon request of the assignees, Operator shall continue to operate the assigned well for the account of the non-abandoning parties at the rates and charges contemplated by this Agreement, plus any additional cost and charges which may arise as the result of the separate ownership of the assigned well.
12. Delay Rentals and Shut-In Well Payments
Operator shall pay all delay rentals and shut-in well payments which may be required under the terms of leases covering any of the tracts described in Exhibit One and submit evidence of such payment to the other parties at their request. The amount of such payment shall be charged by Operator to the joint account of the parties and treated in all respects the same as costs incurred in the development and operation of the Unit Area. Operator shall diligently attempt to make proper payment but shall not be held liable to the other parties in damages for the loss of any lease or interest therein and there shall be no readjustment of interests in the remaining portion of the Unit Area. If any party secures a new lease covering the terminated interest, such acquisition shall be subject to the provisions of Paragraph 17 of this Agreement.
13. Resignation of Operator
Operator may resign from its duties and obligations as Operator at any time upon written notice of not less than 60 days given to all other parties. In this case, all parties to this contract shall select by majority vote in interest, not in numbers, a new Operator who shall assume the responsibilities and duties, and have the rights, prescribed for Operator by this Agreement. The retiring Operator shall deliver to its successor all records and information necessary to the discharge by the new Operator of its duties and obligations.
14. Maintenance of Unit Ownership
For the purpose of maintaining uniformity of ownership on the oil and gas leasehold interests covered by this contract, and notwithstanding any other provisions to the contrary, no party shall sell, encumber, transfer or make other disposition of its interest in the leases embraced within the Unit Area and in wells, equipment and production unless such disposition is made expressly subject to this Agreement, and shall be made only with prejudice to the rights of the other parties, and the consent of Operator.
If at any time the interest of any party is divided among and owned by four or more co-owners, Operator may, at its discretion, require such co-owners to appoint a single trustee or agent with full authority to receive notices, approve expenditures, receive billings for and approve and pay such party's share of the joint expenses, and to deal generally with, and with power to bind, the co-owners of such party's interest within the scope of the operations embraced in this contract; however, all such co-owners shall enter into and execute all contracts or agreements for the disposition of their respective shares of the oil and gas produced from the Unit Area, and they shall have the right to receive, separately, payment of the sale proceeds thereof.
15. Liability of Parties
The liability of the parties shall be several, not joint or collective. Each party shall be responsible only for its obligations, and shall be liable only for its proportionate share of the costs of developing and operating the Unit Area. Accordingly, the lien granted by each party to Operator herein is given to secure only the debts of each severally. It is not the intention of the
parties to create, nor shall this Agreement be construed as creating or constructing a mining or other partnership or association or to render them liable as partners.
16. Renewal or Extension of Lease
If any party secures a renewal of any oil and gas lease subject to this contract, each and all of the other parties shall be notified promptly and shall have the right to participate in the ownership of the renewal lease by paying to the party who acquired it, within thirty (30) days after receipt of such notification, their several proper proportionate share of the acquisition costs, which shall be in proportion to the interests held at that time by the parties in the Unit Area. Failure of any party to timely pay its proportionate share of such acquisition cost shall be deemed an election not to participate.
If some, but less than all, of the parties elect to participate in the purchase of a renewal lease, it shall be owned by the parties who elect to participate therein, in a ratio based upon the relationship of their respective percentage of participation in the purchase of such renewal lease. Any renewal lease in which less than all the parties elect to participate shall not be subject to this Agreement.
Each party who participates in the purchase of a renewal lease shall be given an assignment of its proportionate interest therein by the acquiring party.
The provisions of this section shall apply to renewal leases whether they are for the entire interest covered by the expiring lease or cover only a portion of its area or an interest therein. Any renewal lease taken before the expiration of its predecessor lease, or taken or contracted for within six (6) months after the expiration of the existing lease, shall not be deemed a renewal lease and shall not be subject to the provisions of this section.
The provisions in this section shall apply also and in like manner to extensions of oil and gas leases.
17. Surrender of Leases
The leases covered by this Agreement, insofar as they embrace acreage in the Unit Area, shall not be surrendered in whole or in part unless all parties consent.
However, should any party desire to surrender its interest in any lease or in any portion thereof, and other parties not agree or consent, the party desiring to surrender shall assign without express or implied warranty of title, all of its interest in such lease, or portion thereof, and any well, material and equipment which may be located thereon and any rights in production thereafter secured, to the parties not desiring to surrender it. Upon such assignment, the assigning party shall be relieved from all obligations thereafter accruing, but not theretofore accrued, with respect to the acreage assigned and the operations of any well thereon, and the assigning party shall have no further interest in the lease assigned and its equipment and production. The parties assignee shall pay to the party assignor the reasonable salvage value of the latter's interest in any wells and equipment on the assigned
acreage, determined in accordance with the provisions of Exhibit B, less estimated cost of salvaging and the estimated cost of plugging and abandoning. If the assignment is in favor of more than one party, the assigned interest shall be shared by the parties assignee in the proportions that the interest of each bears to the interest of all parties assignee.
Any assignment or surrender made under this provision shall not reduce or change the assignor's or surrendering parties' interest, as it was immediately before the assignment, in the balance of the Unit Area and the acreage assigned or surrendered, and subsequent operations thereof, shall not thereafter be subject to the terms and provisions of this Agreement.
18. Provision Concerning Taxation
The liabilities of the parties hereto shall be several and not joint or collective, and each party shall be responsible for its proportionate share of the costs and liabilities incurred as provided hereunder. It is not the purpose or intention of the Agreement to create for state law any partnership or association, and neither this Agreement nor the operations hereunder shall be construed or considered as creating any such relationship. Furthermore, the parties hereto acknowledge and represent that it is not their intention to create a Partnership for federal and state income tax purposes, and each party agrees to elect to be excluded from the application of Subchapter K of Chapter 1 of Subtitle A of the Internal Revenue Code of 1954, as amended (the Code), or any similar provisions contained in applicable statutes of the various states of the United States.
Operator shall render to each party an annual working interest statement and accompanying 1099-Misc. Form, and each party is then liable for preparation of necessary tax forms to the Internal Revenue Service.
Operator shall render for ad valorem taxation all property subject to this Agreement, which by law should be rendered for such taxes, and it shall pay all such taxes assessed thereon before they become delinquent. Operator shall bill all other parties for their proportionate share of all tax payments in the manner provided in Exhibit Two.
If any tax assessment is considered unreasonable by Operator, it may at its discretion protest such valuation within the time and manner prescribed by law and prosecute the protest to a final determination, unless all parties agree to abandon the protest prior to final determination. When any such protested valuation shall have been finally determined, Operator shall pay the assessment for the joint account, together with interest and penalty accrued, and the total costs shall then be assessed against the parties, and be paid by them, as provided in Exhibit B.
19. Insurance
At all times while operations are conducted hereunder, Operator shall comply with the applicable Workmen's Compensation Law of the State where the operations are being conducted. Operator shall require all the contractors engaged in work on or for the Unit Area to comply with Workmen's Compensation Law of the State where the operations are being conducted and to maintain such other insurance as operations may require.
20. Claim and Lawsuits
If any party to this contract is sued on an alleged cause of action arising out of operations on the Unit Area, or on an alleged cause of action involving title to any lease or oil and gas interest subject to this contract, it shall promptly give written notices of the suit to the Operator.
The defense of lawsuits can be under the general direction of a committee of lawyers representing the parties, with Operator's attorney as Chairman. Suits may be settled during litigations only with the joint consent of all the parties. All expenses incurred in the defense of suits, together with the amount paid to discharge any final judgment shall be considered costs of operation and shall be charged to and paid by all parties in proportion to their then interest in the Unit Area, or can be handled by the Operator's legal counsel on the behalf of all parties.
Damage claims caused by and arising out of operation on the Unit Area, conducted for the joint account of all parties shall be handled by Operator and its attorneys, the settlement of claims of this kind shall be within the discretion of Operator so long as the amount paid in settlement of any one claim does not exceed Fifty Thousand Dollars ($50,000) and, if settled, the sums paid in settlement shall be charged as expense to and be paid by all parties in proportion to their interests in the Unit Area.
21. Force Majeure
If any party is rendered unable, wholly or in part, by force majeure, to carry out its obligations under this Agreement other than the obligation to make money payments, that party shall give to all other parties prompt written notice of the force majeure with reasonably full particulars concerning it; thereupon the obligations of the party giving the notice, so far as they are affected by the force majeure, shall be suspended during, but no longer than the continuance of the force majeure. The affected party shall use all possible diligence to remove the force majeure as quickly as possible.
The requirement that any force majeure shall be remedied with all reasonable dispatch shall not require the settlement of strikes, lockouts, or other labor difficulty by the party involved contrary to its wishes; how all such difficulties shall be handled shall be entirely within the discretion of the party concerned.
The term "force majeure" as here employed shall mean an act of God, strike, lockout or other industrial disturbance, act of the public enemy, war blockage, public riot, lightening, fire, storm, flood, explosion, governmental restraint, unavailability of equipment, and any other cause, whether of the kind specifically enumerated above or otherwise, which is not reasonably within the control of the party claiming suspension.
22. Notices
All notices authorized or required between the parties and required by any of the provisions of this Agreement shall, unless otherwise specifically provided, be given in writing by United States mail or Western Union Telegram,
with postage or charges prepaid, and addressed to the party whom the notice is given at the addresses listed opposite their signature below. The originating notice to be given under any provisions hereof shall be deemed given only when received by the party to whom such notice is directed, and the time for such party to give any response thereto shall run from the date the originating notice is received.
The second or any responsive notice shall be deemed given when deposited in the United States mail or with the Western Union Telegram Company, with postage or charges prepaid. Each party shall have the right to change its address as any time and from time to time by giving written notice thereof to all other parties.
This Agreement may be signed in counterpart, and shall be binding upon the parties and upon their heirs, successors, representatives, and assigns.
OPERATOR:
By: /s/ Joseph A. Lanza ------------------------------------ Name: Joseph A. Lanza Title: President |
NON-OPERATORS:
By: /s/ J. Michael Page
------------------------------------
Name: Perkins Oil & Gas, Inc.
Address: 1445 Marpole Ave #409
Vancouver BC Canada V6H1S5
|
EXHIBIT "B"
ACCOUNTING PROCEDURE
(Unit and Joint Lease Operations)
I. GENERAL PROVISIONS
A. Definitions: "Joint Property" as herein used shall be construed to mean the subject area covered by the Agreement to which this "Accounting Procedure" is attached.
"Operator" as herein used shall be construed to mean the party designated to conduct the development and operation of the subject area for the joint account of the parties hereto.
"Non-operator" as herein used shall be construed to mean any one or more of the non-operating parties.
B. Accounting to Non-Operator: Operator will collect all working interest owners' oil and gas revenues and deduct therefrom the cost of operating and maintaining the oil and gas properties. The remainder will then be distributed monthly to each working interest owner proportionate to his working interest ownership on the oil and gas properties covered by this Agreement.
C. Adjustments: Payment of any such bills shall not prejudice the right of non-operator to protest or question the correctness thereof. All statements rendered to non-operator by Operator during any calendar year within twelve (12) month period following the end of each such calendar year, provided, however, that non-operator must take written exception to and make claim upon the Operator for adjustment. Failure on the part of non-operator to make claims on Operator for adjustment within such period shall establish the correctness of claims for adjustment thereon.
D. Audits: A non-operator upon notice in writing to Operator and all other
non-operators, shall have the right to audit Operator's accounts and records
relating to the accounting hereunder for any calendar year within the twelve
(12) month period following the end of such calendar year; provided, however,
that non-operator must take written exception to and make claim upon the
Operator for all discrepancies disclosed by said audit within said twelve (12)
month period. Where there are two or more non-operators, the non-operators shall
make every reasonable effort to conduct joint or simultaneous audits in a manner
that will result in a minimum of inconvenience to Operator.
II. DEVELOPMENT AND OPERATING CHARGES
Subject to limitations hereinafter prescribed, Operator shall charge the joint account with the following items:
A. Rental and Royalties: Delay or other rentals, when such rentals are paid by Operator for the joint account, royalties, when not paid directly to royalty owners by the purchaser of the oil, gas, casinghead gas, or other products.
B. Service: Outside Services -- The cost, of contract services and utilities procured from outside sources.
C. Damages and Losses to Joint Property and Equipment: All costs or expenses necessary to replace or repair damages or losses incurred by fire, flood, storm, theft, accident, or any other causes not controlled by Operator through the exercise of reasonable diligence. Operator shall furnish non-operator written notice of damages or losses incurred as soon as practicable after report of the same has been received by Operator.
D. Litigation Expenses: All costs and expenses of litigation or legal services otherwise necessary or expedient for the protection of the joint interest, including attorney's fees and expenses hereinafter provided, together with all judgment obtained against the parties or any of them on account of the joint operations under this Agreement, and actual expenses incurred by any party or parties hereto in securing evidence for the purpose of defending against any action or claim prosecuted or urged against the joint account or the subject matter of this Agreement.
1. If a majority of the interests hereunder shall so agree, actions or claims affecting the joint interests hereunder may be handled by the attorney of one or more of the parties hereto; and a charge commensurate with cost of providing and furnishing such services rendered may be made against the joint account; but no such charge shall be made until approved by the Operator's attorneys.
2. Fees and expenses of attorneys other than Operator's attorneys shall not be charged to the joint account unless authorized by the majority of the interests hereunder.
E. Taxes: All taxes of every kind and nature assessed or levied upon or in connection with the properties which are the subject of this Agreement, the production therefrom or the operation thereof, and which taxes have been paid by the Operator for the benefit of the parties hereto.
F. Insurance and Claims
1. Premiums paid for insurance required to be carried for the benefit of the joint account, together with all expenditures incurred and paid in settlement of any and all losses, claims, damages, judgments and other expenses, including legal services, not recovered from insurance carrier.
2. If no insurance is required to be carried, all actual expenditures incurred and paid by the Operator in settlement of any and all losses, claims, damages, judgments or any other expenses, including legal services, shall be charged to the joint account.
G. Operating and Administrative: Operator shall have the right to assess against the joint party covered thereby $200 per month per well for administrative overhead and related costs. Pumper charge will be limited to $65 per month in addition to the above administrative fee. In addition, participants and Operator will pay their proportionate share of lease and well operation costs. All costs attributable to participants will be deducted from revenue due them. These costs are subject to escalation, based on the U.S. Consumer Price Index.
1. Overhead charges for producing wells shall begin on the date the well operations are taken over by the operator and terminate when it is plugged.
2. In connection with overhead charges, the status of wells shall be as follows:
a. Injection wells for recovery operations, such as for repressure of water flood, shall be included in the overhead schedule the same as producing wells.
b. Water supply wells utilized for water flooding operations shall be included in the overhead schedule the same as producing oil wells.
c. Producing gas wells shall be included in the overhead schedule the same as producing oil wells.
d. Wells permanently shut down but on which plugging operations are deferred shall be dropped from the overhead schedule at the time the shut-down is effected. When such wells are plugged, overhead will be charged at the producing well rate during the time required for the plugging operation.
e. Wells being plugged back, drilled deeper, or converted to a source or input well shall be included in the overhead schedule the same as drilling wells.
f. Temporarily shut down wells (other than by governmental regulatory body) which are not produced or worked upon for a period of a full calendar month shall not be included in the overhead schedule; however, wells shut in by governmental authority shall be included in the overhead schedule only in the event the allowable production is transferred to other wells on the same property. In the event of a unit allowable, all wells capable of producing will be counted in determining the overhead charge.
g. Wells completed in dual or multiple horizons shall be considered as one well in the producing overhead schedule.
h. Lease salt water disposal wells shall not be included in the overhead schedule unless such wells are used as a secondary recovery program on the joint property.
7. The above overhead schedule for producing wells shall be applied to the total number of wells operated under the Operating Agreement to which this accounting procedure is attached, irrespective of individual lease.
8. It is specifically understood that the above overhead rates apply only to drilling and producing operations and are not intended to cover the construction or operation of additional facilities such as, but not limited to, gasoline plants, compressor plants, repressuring projects, salt water disposal facilities, and similar installations. if any or all of these become necessary to the operation, a separate agreement will be reached relative to an overhead charge, if any.
9. The above specific overhead rates may be amended from time to time by agreement between Operator and non-operator if, in practice, they are found to be insufficient or excessive.
H. Other Expenditures: Any expenditure, other than expenditures which are covered and dealt with by the foregoing provisions of this Section II, incurred by the Operator for the necessary and proper development, maintenance and operation of the joint property.
III. BASIS OF CHARGES TO JOINT ACCOUNT
Purchases: Material and equipment purchases and service procured shall be charged at the prices paid by Operator after deduction of all discount actually received.
Exhibit 23.2
PLS CPA, A PROFESSIONAL CORP.
* 4725 MERCURY STREET #210 * SAN DIEGO * CALIFORNIA 92111 *
* TELEPHONE (858)722-5953 * FAX (858) 761-0341 * FAX (858) 433-2979 * E-MAIL changgpark@gmail.com *
January 30, 2013
To Whom It May Concern:
We hereby consent to the use in this Registration Statement on Form S-1 of our report dated October 31, 2012, relating to the financial statements of Perkins Oil & Gas Inc. as of June 30, 2012, which appears in such Registration Statement. We also consent to the references to us under the headings "Experts" in such Registration Statement.
Very truly yours,
/s/PLS CPA ---------------------------- PLS CPA, A Professional Corp. San Diego, CA 92111 |