U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
DELAWARE 98-0357690 ------------- ----------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) |
STRATO MALAMAS
4526 Underwood Avenue
North Vancouver, B.C.
British Columbia, Canada V7K 2S2
------------------------- -------
(Name and address of principal (Zip Code)
executive offices)
Registrant's telephone number,
including area code: (604)961-8878
--------------
Approximate date of commencement of proposed
sale to the public: as soon as practicable after
the effective date of this
Registration Statement.
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The selling shareholders are required to sell our shares at $0.05 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices.
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. |__|
If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. |__|
CALCULATION OF REGISTRATION FEE
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TITLE OF EACH PROPOSED PROPOSED
CLASS OF MAXIMUM MAXIMUM
SECURITIES OFFERING AGGREGATE AMOUNT OF
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(1) Based on the last sales price of $0.05 on April 30, 2002.
(2) Estimated solely for the purpose of calculating the registration
fee in accordance with Rule 457 under the Securities Act.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY DETERMINE.
SUBJECT TO COMPLETION, Dated March 21, 2003
PROSPECTUS
The selling shareholders named in this prospectus are offering all of our shares of common stock offered through this prospectus. We will not receive any proceeds from this offering.
Our common stock is presently not traded on any market or securities exchange.
The purchase of the securities offered through this prospectus involves a high
degree of risk. SEE SECTION ENTITLED "RISK FACTORS" ON PAGES 5 - 9.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. The Securities and Exchange Commission has not made any recommendations that you buy or not buy our shares. Any representation to the contrary is a criminal offense.
The Date Of This Prospectus Is: March 21, 2003
Summary ............................................................... 4
Risk Factors .......................................................... 5
Risks Related To Our Financial Condition and Business Model
- -----------------------------------------------------------
- If we do not obtain additional financing, our business will fail.. 5
- If we do not complete the required option payments and
capital expenditure requirements mandated in our option,
we will lose our interest in the Hood County Prospect, Randall
Lease our business may fail ...................................... 5
- Because we have not commenced business operations, we face
a high risk of business failure .................................. 6
- Because of the speculative nature of exploration of oil and gas
properties, there is substantial risk that this business
will fail ........................................................ 6
- Because of the inherent dangers involved in oil and gas
exploration, there is a risk that we may incur liability or
damages as we conduct our business ............................... 7
- Even if we discover commercial reserves of oil and gas
on our optioned oil and gas properties, we may not be able to
successfully obtain commercial production ........................ 7
- We need to continue as a going concern if our business is
to succeed ....................................................... 7
Risks Related To Our Market And Strategy
- ----------------------------------------
- If we do not obtain clear title to the oil and gas properties,
our business may fail ............................................ 7
Risks Related To Legal Uncertainty
- ----------------------------------
- If we become subject to burdensome government regulation
or other legal uncertainties, our business will be
negatively effected .............................................. 7
Risks Related To This Offering
- ------------------------------
- Because our president, Mr. Strato Malamas, owns 63.68% of our
outstanding stock, he will control and make corporate
decisions that may be disadvantageous to other minority
stockholders ..................................................... 8
- Because our president has other business interests,
he may not be able or willing to devote a sufficient
amount of time to our business operations, causing our
business to fail ................................................. 8
- Because management has only limited experience in oil and gas
exploration, the business has a higher risk of failure ........... 8
- If a market for our common stock does not develop,
shareholders may be unable to sell their shares .................. 8
- If a market for our common stock develops, our stock
price may be volatile ............................................ 9
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- If the selling shareholders sell a large number of
shares all at once or in blocks, the market price of our
shares would most likely decline ................................. 9
Use of Proceeds ...................................................... 10
Determination of Offering Price ...................................... 10
Dilution ............................................................. 10
Selling Shareholders ................................................. 10
Plan of Distribution ................................................. 13
Legal Proceedings .................................................... 15
Directors, Executive Officers, Promoters and Control Persons ......... 16
Security Ownership of Certain Beneficial Owners and Management ....... 17
Description of Securities ............................................ 18
Interest of Named Experts and Counsel ................................ 19
Disclosure of Commission Position of Indemnification for
Securities Act Liabilities ........................................... 19
Organization Within Last Five Years .................................. 20
Description of Business .............................................. 20
Plan of Operations ................................................... 25
Description of Property .............................................. 26
Certain Relationships and Related Transactions ....................... 27
Market for Common Equity and Related Stockholder Matters ............. 27
Executive Compensation ............................................... 28
Financial Statements ................................................. 30
Changes in and Disagreements with Accountants ........................ 31
Available Information ................................................ 31
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Until --------, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
Summary
Go Energy, Inc.
Prospective investors are urged to read this prospectus in its entirety.
We intend to commence operations in the oil and gas property exploration business. To date, we have not conducted any exploration activities. We have obtained a 25% working interest and a 19.50% net revenue interest in oil and gas leases located in Hood County, Texas. We refer to this oil and gas property as the Hood County Prospect. We may exercise this option by funding 25% of all expenditures necessary to drill a test oil and gas well on the property. We also own a 1% working interest, and corresponding 0.78% net revenue interest, in another property located in Hood County known as the Tolar Property.
Our objective is to conduct oil and gas exploration activities on the Hood County Prospect in order to assess whether it possesses commercially exploitable reserves of oil and/or natural gas. We have not, as yet, identified any commercially exploitable reserves. Our proposed exploration program is designed to search for commercially exploitable reserves.
We were incorporated on May 2, 2001 under the laws of the state of Delaware. Our principal offices are located at 4526 Underwood Avenue, North Vancouver, British Columbia, Canada.
The Offering
Securities Being Offered Up to 1,569,893 shares of common stock.
Offering Price The selling shareholders will sell our
shares at $0.05 per share until our shares
are quoted on the OTC Bulletin Board, and
thereafter at prevailing market prices or
privately negotiated prices. We determined
this offering price arbitrarily based upon
the price of the last sale of our common
stock to investors.
Terms of the Offering The selling shareholders will determine
when and how they will sell the common
stock offered in this prospectus.
Termination of the Offering The offering will conclude when all of the
1,569,893 shares of common stock have been
sold, the shares no longer need to be
registered to be sold or we decide to
terminate the registration of the
shares.
Securities Issued
And to be Issued 4,319,893 shares of our common stock are
issued and outstanding as of the date of
this prospectus. Existing shareholders
will sell all of the shares of our common
stock to be sold under this prospectus.
Use of Proceeds We will not receive any proceeds from the
sale of the common stock by the selling
shareholders.
Summary Financial Information
Balance Sheet Data December 31,2002
------------------
Cash $ 19,220
Total Assets $ 55,938
Liabilities $ 24,500
Total Stockholders' Equity $ 31,438
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From Incorporation on For the five-month period
May 2, 2001 to December 31, 2002 ended December 31, 2002
Revenue $ 2,753 $1,863
Net Loss $40,207 $ 238
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All of the revenue that we have generated since our incorporation represents bank interest.
Risk Factors
An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously 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.
Risks Related To Our Financial Condition And Business Model
IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS WILL FAIL.
Our current operating funds are less than necessary to complete the exploration of the optioned mineral claims, and therefore we will need to obtain additional financing in order to complete our business plan. As of December 31, 2002, we had cash in the amount of $19,220. We currently do not have any operations and we have no income. Our business plan calls for expenses in connection with the exploration of the Hood County oil and gas prospect.
The first well to be drilled on the Tolar Property is anticipated to cost $463,547. In order to maintain our 1% working interest in the well, we are required to pay $4,635.47. To maintain our 25% working interest in the Hood County Prospect well, we must pay approximately $116,000, representing 25% of the estimated drilling costs. While we have sufficient funds to maintain our 1% working interest in the Tolar Property well, we will require additional financing in order to maintain our 25% working interest in the Hood County Prospect well. We will also require additional financing if the costs of the exploration of our leased oil and gas prospect are greater than anticipated.
IF EXPLORATION OF OUR CURRENT OIL AND GAS PROPERTIES IS UNSUCCESSFUL, WE WILL NEED TO SECURE ADDITIONAL FINANCING TO CONTINUE BUSINESS OPERATIONS.
We will require additional financing to sustain our business operations if we are not successful in earning revenues once exploration is complete. We do not currently have any arrangements for financing and we can provide no assurance to investors that we will be able to find such financing if required. Obtaining additional financing would be subject to a number of factors, including the market price for oil and natural gas, investor acceptance of our property, and investor sentiment. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us.
The most likely source of future funds presently available to us is through the sale of equity capital. Any sale of share capital will result in dilution to existing shareholders. The only other anticipated alternative for the financing of further exploration would be our sale of an interest in our oil and gas property interests to a third party that would conduct further exploration, which is not presently contemplated.
BECAUSE WE HAVE NOT COMMENCED BUSINESS OPERATIONS, WE FACE A HIGH RISK OF BUSINESS FAILURE.
We have not even begun the initial stages of exploration of our oil and gas property assets, and thus have no way to evaluate the likelihood that we will
be able to operate the business successfully. We were incorporated on May 2, 2001 and to date have been involved primarily in organizational activities and the acquisition of an interest in the Tolar Property and the Hood County Prospect. We have not earned any revenues as of the date of this prospectus. Potential investors should be aware of the difficulties normally encountered by new oil and gas exploration companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the Hood County Prospect. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates.
Prior to completion of a first well, we anticipate that we will incur increased operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from the production of oil or gas, we will not be profitable. Our ability to continue operations may be jeopardized.
There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail.
THERE IS SUBSTANTIAL RISK THAT WE WILL NOT FIND EXPLOITABLE OIL AND GAS RESERVES AND THAT OUR BUSINESS WILL FAIL.
The search for valuable hydrocarbons as a business is extremely risky. We can provide investors with no assurance that the Tolar Property or the Hood County Prospect contain commercially exploitable reserves of oil or gas. Exploration for oil and gas is a speculative venture necessarily involving substantial risk. There is no guarantee that any well we drill on either property will result in the discovery of commercial quantities of oil or natural gas.
THERE ARE INHERENT DANGERS INVOLVED IN OIL AND GAS EXPLORATION. WE MAY INCUR LIABILITY FOR ENVIRONMENTAL DAMAGE AND OTHER POTENTIAL HAZARDS.
The search for oil and gas involves numerous hazards. As a result, we may become subject to liability for hazards against which we cannot insure or against which we may elect not to insure. The payment of such liabilities may have a material adverse effect on our financial position. We do not intend to seek environmental liability coverage.
EVEN IF WE DISCOVER COMMERCIAL RESERVES OF OIL AND GAS, WE MAY NOT BE ABLE TO SUCCESSFULLY OBTAIN COMMERCIAL PRODUCTION.
The Tolar Property and the Hood County Prospect do not contain any known reserves of oil or natural gas. If our exploration programs are successful in establishing oil and gas reserves capable of commercial production, we will require additional funds in order to place these properties into commercial production. At this time, we can provide investors with no assurance that we will be able to obtain such financing.
OUR ABILITY TO CONTINUE AS A GOING CONCERN IS QUESTIONABLE.
Our auditors, PKF, Chartered Accountants, indicate in their Report of Independent Chartered Accountants that accompanies our audited financial statements for the fiscal year ended July 31, 2002 that there are a number of factors that raise substantial doubt about our ability to continue as a going concern. These include the fact that we have had no operations, have established no source of revenue and need additional financing in order to complete our business plan. If we are unable to continue as a going concern, it is likely investors will lose their investments.
IF WE BECOME SUBJECT TO BURDENSOME GOVERNMENT REGULATION OR OTHER LEGAL UNCERTAINTIES, OUR BUSINESS WILL BE NEGATIVELY AFFECTED.
The legal and regulatory environment that pertains to the exploration of oil and gas is uncertain and may change. Uncertainty and new regulations could increase our costs of doing business and prevent us from exploring for oil and gas reserves. In addition to new laws and regulations being adopted, existing laws maybe applied to the oil and gas industry that have not as yet been applied. These new laws may increase our cost of doing business with the result that our financial condition and operating results may be harmed.
BECAUSE OUR PRESIDENT, MR. STRATO MALAMAS, OWNS 63.46% OF OUR OUTSTANDING COMMON STOCK, HE WILL MAKE AND CONTROL CORPORATE DECISIONS THAT MAY BE DISADVANTAGEOUS TO MINORITY SHAREHOLDERS.
Mr. Strato Malamas, our president and director, owns approximately 63.46% of the outstanding shares of our common stock. Accordingly, he will have a significant influence in determining the outcome of all corporate transactions or other matters, including mergers, consolidations and the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. The interests of Mr. Malamas may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders.
BECAUSE MANAGEMENT HAS ONLY LIMITED EXPERIENCE IN OIL AND GAS EXPLORATION, THE BUSINESS HAS A HIGHER RISK OF FAILURE.
Our management has only limited experience in oil and gas exploration. As a result of this inexperience, there is a higher risk of our being unable to complete our business plan in the exploration and exploitation of oil and gas properties.
IF A MARKET FOR OUR COMMON STOCK DOES NOT DEVELOP, SHAREHOLDERS MAY BE UNABLE TO SELL THEIR SHARES.
There is currently no market for our common stock and we can provide no assurance that a market will develop. If no market is ever developed for our shares, it will be difficult for shareholders to sell their stock. In such a case, shareholders may find that they are unable to achieve benefits from their investment.
IF A MARKET FOR OUR COMMON STOCK DEVELOPS, OUR STOCK PRICE MAY BE VOLATILE.
If a market for our common stock develops, we anticipate that the market price of our common stock will be subject to wide fluctuations in response to several factors, including:
(1) actual or anticipated variations in our results of operations;
(2) our ability or inability to generate new revenues;
(3) increased competition; and
(4) conditions and trends in the oil and gas industry.
Further, our stock price may be impacted by factors that are unrelated or disproportionate to our operating performance. These market fluctuations, as well as general economic, political and market conditions, such as recessions, interest rates or international currency fluctuations may adversely affect the market price of our common stock.
Forward-Looking Statements
This prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend and similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results are most likely to differ materially from those anticipated in these forward-looking statements for many reasons, including the risks that we face described in the this Risk Factors section and elsewhere in this prospectus.
Use Of Proceeds
We will not receive any proceeds from the sale of the common stock offered through this prospectus by the selling shareholders.
Determination Of Offering Price
The selling shareholders are required to sell our shares at $0.05 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices.
Dilution
The common stock to be sold by the selling shareholders is common stock that is currently issued and outstanding. Accordingly, there will be no dilution to our existing shareholders.
Selling Shareholders
The selling shareholders named in this prospectus are offering all of the 1,569,893 shares of common stock offered through this prospectus. These shares were acquired from us in a private placement completed April 30, 2001 that was exempt from registration under Regulation S of the Securities Act of 1933.
The following table provides as of March 21, 2003, information regarding the beneficial ownership of our common stock held by each of the selling shareholders, including:
1. the number of shares owned by each prior to this offering;
2. the total number of shares that are to be offered for each;
3. the total number of shares that will be owned by each upon
completion of the offering; and
4. the percentage owned by each upon completion of the offering
Total Number
Of Shares To Total Shares Percent
Be Offered For to Be Owned Owned Upon
Name Of Shares Owned Selling Upon Completion
Selling Prior To This Shareholders Completion Of Of This
Stockholder Offering Account This Offering Offering
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David Oger 200,000 200,000 Nil Nil
11247 Park Place
Surrey BC, Canada
Traugott Dalke 20,000 20,000 Nil Nil
22164-20th Avenue
Surrey BC, Canada
Edith Harmat 10,000 10,000 Nil Nil
2048 Palliser Avenue
Chilliwack BC, Canada
Richard Starling 10,000 10,000 Nil Nil
30358 Merryfield Avenue
Abbotsford BC, Canada
Peter Walton 10,000 10,000 Nil Nil
14530-92nd Avenue
Surrey BC, Canada
Norman Starling 20,000 20,000 Nil Nil
30358 Merryfield Avenue
Abbotsford BC Canada
Kati Barker 20,000 20,000 Nil Nil
32245 Cordova Avenue
Abbotsford BC, Canada
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Total Number
Of Shares To Total Shares Percent
Be Offered For Owned Upon Owned Upon
Name Of Shares Owned Selling Completion Completion
Selling Prior To This Shareholders of this Of This
Stockholder Offering Account Offering Offering
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Edna Hotchen 100,000 100,000 Nil Nil
6772-256th Street
Aldergrove BC, Canada
Nyliram Enterprises
Ltd. 10,000 10,000 Nil Nil
Jerry Klein
5317- 252 Avenue
Alderegrove BC, Canada
Simone Grenier 100,000 100,000 Nil Nil
331-2451 Gladwin Road
Abbotsford BC, Canada
Susan Watkins 10,000 10,000 Nil Nil
7664 Garrett Drive
Delta BC, Canada
Suzanne Kennedy 10,000 10,000 Nil Nil
33700 Essendene Avenue
Abbotsford BC, Canada
Anne-Marie 100,000 100,000 Nil Nil
Hartmann
9410-266th Street
Whonnock BC, Canada
Dudley Sheppard 10,000 10,000 Nil Nil
11494-79A Avenue
North Delta BC, Canada
Jack Wilkinson 100,000 100,000 Nil Nil
6638 Stoney Crescent
Delta BC, Canada
Derek Judd 40,000 40,000 Nil Nil
11315 Loughren
Surrey BC, Canada
Vera Scarfe 40,000 40,000 Nil Nil
#25-5721-231A Street
Langley BC, Canada
Tom Moran 50,000 50,000 Nil Nil
29155 McTavish Road
Abbotsford BC, Canada
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Total Number
Of Shares To Total Shares Percent
Be Offered For Owned Upon Owned Upon
Name Of Shares Owned Selling Completion Completion
Selling Prior To This Shareholders of this Of This
Stockholder Offering Account Offering Offering
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Michael Moran 50,000 50,000 Nil Nil
29155 McTavish Road
Abbotsford BC, Canada
Adele Nichols 20,000 20,000 Nil Nil
208-32175 Old Yale Road
Abbotsford BC, Canada
Suzanne 100,000 100,000 Nil Nil
Skaaning
29172 Taylor Road
Mt. Lehman BC, Canada
Peter Sabell 20,000 20,000 Nil Nil
7B-30321 Fraser Hwy.
Abbotsford BC, Canada
Gail Read 100,000 100,000 Nil Nil
23788-72 Avenue
Langley BC, Canada
Kathe D. 100,000 100,000 Nil Nil
Atkinson
4833 Angus Place
Surrey BC, Canada
Kevin 100,000 100,000 Nil Nil
McCulloch
29495 Taylor Road
Mt. Lehman BC, Canada
Reinhard 100,000 100,000 Nil Nil
Grohmueller
6080 Ross Road
Abbotsford BC, Canada
John Watt 40,000 40,000 Nil Nil
6685-19th Street
Surrey BC, Canada
Peter & Moira 26,293 26,293 Nil Nil
Gray
29669 Camelot Avenue
Mt. Lehman BC, Canada
Eric Scott 4,000 4,000 Nil Nil
4561-198B Street
Langley BC, Canada
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Total Number
Of Shares To Total Shares Percent
Be Offered For Owned Upon Owned Upon
Name Of Shares Owned Selling Completion Completion
Selling Prior To This Shareholders of this Of This
Stockholder Offering Account Offering Offering
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Neil Jurlsen 4,200 4,200 Nil Nil
8106-169th Street
Surrey BC, Canada
Nina Watt 5,000 5,000 Nil Nil
35333 Sandyhill Road
Abbotsford BC, Canada
Dean Irving 10,000 10,000 Nil Nil
4336-204th Street
Langley BC,Canada
Richard Sloan 4,400 4,400 Nil Nil
8359-167A Street
Surrey BC, Canada
Diane Miller 4,000 4,000 Nil Nil
32708 Chilcotin Drive
Abbotsford BC, Canada
E. Gilliland 10,000 10,000 Nil Nil
29592 Galahad Crescent
Abbotsford BC, Canada
Ann Penner 6,000 6,000 Nil Nil
12275 Gardener Street
Surrey BC, Canada
Karen Henne 6,000 6,000 Nil Nil
PO Box 144
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Maderia Park BC, Canada
TOTAL: 1,569,893 1,569,893 Nil Nil
The named party beneficially owns and has sole voting and investment power over all shares or rights to these shares. The numbers in this table assume that none of the selling shareholders sells shares of common stock not being offered in this prospectus or purchases additional shares of common stock, and assumes that all shares offered are sold. The percentages are based on 4,319,893 shares of common stock outstanding on March 21, 2003.
None of the selling shareholders:
(1) has had a material relationship with us other than as a shareholder at any time within the past three years; or
(2) has ever been one of our officers or directors.
Plan Of Distribution
The selling shareholders may sell some or all of their common stock in one or more transactions, including block transactions:
1. On such public markets or exchanges as the common stock may from
time to time be trading;
2. In privately negotiated transactions;
3. Through the writing of options on the common stock;
4. In short sales; or
5. In any combination of these methods of distribution.
The sales price to the public may be:
1. The market price prevailing at the time of sale;
2. A price related to such prevailing market price; or
3. Such other price as the selling shareholders determine from
time to time.
The selling shareholders are required to sell our shares at $0.05 per share until our shares are quoted on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices.
The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144.
The selling shareholders may also sell their shares directly to market makers acting as principals or brokers or dealers, who may act as agent or acquire the common stock as a principal. Any broker or dealer participating in such transactions as agent may receive a commission from the selling shareholders, or, if they act as agent for the purchaser of such common stock, from such purchaser. The selling shareholders will likely pay the usual and customary brokerage fees for such services. Brokers or dealers may agree with the selling shareholders to sell a specified number of shares at a stipulated price per share and, to the extent such broker or dealer is unable to do so acting as agent for the selling shareholders, to purchase, as principal, any unsold shares at the price required to fulfill the respective broker's or dealer's commitment to the selling shareholders. Brokers or dealers who acquire shares as principals may thereafter resell such shares from time to time in transactions in a market or on an exchange, in negotiated transactions or otherwise, at market prices prevailing at the time of sale or at negotiated prices, and in connection with such re-sales may pay or receive commissions to or from the purchasers of such shares. These transactions may involve cross and block transactions that may involve sales to and through other brokers or dealers. If applicable, the selling shareholders may distribute shares to one or more of their partners who are unaffiliated with us. Such partners may, in turn, distribute such shares as described above. We can provide no assurance that all or any of the common stock offered will be sold by the selling shareholders.
We are bearing all costs relating to the registration of the common stock. The selling shareholders, however, will pay any commissions or other fees payable to brokers or dealers in connection with any sale of the common stock.
The selling shareholders must comply with the requirements of the Securities Act and the Securities Exchange Act in the offer and sale of the common stock. In particular, during such times as the selling shareholders may be deemed to be engaged in a distribution of the common stock, and therefore be considered to be an underwriter, they must comply with applicable law and may, among other things:
1. Not engage in any stabilization activities in connection with our common stock;
2. Furnish each broker or dealer through which common stock may be offered, such copies of this prospectus, as amended from time to time, as may be required by such broker or dealer; and
3. Not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Securities Exchange Act.
The Securities and Exchange Commission has also adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00 (other
than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system).
The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, deliver a standardized risk disclosure document prepared by the Commission, which:
* contains a description of the nature and level of risk in the
market for penny stocks in both public offerings and secondary
trading;
* contains a description of the broker's or dealer's duties to the
customer and of the rights and remedies available to the customer
with respect to a violation to such duties or other requirements
of Securities' laws;
* contains a brief, clear, narrative description of a dealer market,
including "bid" and "ask" prices for penny stocks and the
significance of the spread between the bid and ask price;
* contains a toll-free telephone number for inquiries on
disciplinary actions;
* defines significant terms in the disclosure document or in the
* conduct of trading penny stocks; and
* contains such other information and is in such form (including
* language, type, size, and format) as the Commission shall require
* by rule or regulation;
The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer:
* with bid and offer quotations for the penny stock;
* the compensation of the broker-dealer and its salesperson in the
transaction;
* the number of shares to which such bid and ask prices apply, or
other comparable information relating to the depth and liquidity
of the market for such stock; and
* monthly account statements showing the market value of each penny
stock held in the customer's account.
In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from those 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 acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements will have the effect of reducing the trading activity in the secondary market for our stock because it will be subject to these penny stock rules. Therefore, stockholders may have difficulty selling those securities.
Legal Proceedings
We are not currently a party to any legal proceedings. Our address for service of process in Delaware is 2711 Centerville Road, Suite 400 Wilmington Delaware.
Directors, Executive Officers, Promoters And Control Persons
Our executive officers and directors and their respective ages as of March 21, 2003 are as follows:
Directors:
Name of Director Age
- ---------------------- -----
Strato Malamas 44
Stewart Jackson 61
James Michael Stewart 52
Executive Officers:
Name of Officer Age Office
- -------------------- ----- -------
Strato Malamas 44 president, chief
executive officer,
secretary, treasurer,
chief financial
officer and director
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Biographical Information
Set forth below is a brief description of the background and business experience of each of our executive officers and directors for the past five years.
Strato Malamas is our president, chief executive officer, secretary, treasurer and chief financial officer. Since 1983, he has been a licensed realtor involved in property development, sales and management. Mr. Malamas has been the principal of Brooklyn Property Management Limited, a private real estate management company, since 1984. He has also acted as president and a director of Patriarch, Inc. a private, mineral property exploration company, since 2001. Mr. Malamas spends approximately 25% of his business time on our operations.
Stewart Jackson, PhD., is a geologist with over 30 years experience in the mineral exploration and development industry. He holds a Bachelor of Science degree in geology from the University of Western Ontario, a Masters of Science degree in geology from the University of Toronto and a Ph.D. in stratigraphy and economic geology from the University of Alberta. Since 1987, Mr. Jackson has been a self-employed geological consultant working on various gold, silver, diamond and base metal projects in Canada and the United States. His work has included site remediation for environmental clearances; fuel blending and waste disposal and waste-water clean-up. He acted as president of Crown Resource Corp., a Canadian reporting company, from 1981 to 1987. Mr. Jackson spends approximately 3% of his business time on our operations.
James Michael Stewart received his Bachelor of Arts degree in Pre-Law from the University of Alabama in 1974. He then proceeded to study finance and business at the University of Georgia. From 1975 to 1976, Mr. Stewart served as vice-president of Occidental Petroleum Corporation's chemical group in Dallas,
Texas. In this position, he was directly involved in corporate management, national and global business strategy, as well as mergers acquisitions and divestments. From 1985 to 1997, Mr. Stewart acted as vice-president and assistant to the president of a private food company located in Dallas. From 1987 to 1999, he acted as president and chief executive officer of Natural Gas Technologies, an independent Texas oil and gas producer. Since 2000, Mr. Stewart has acted as president of International Oil & Gas, Inc., a Delaware company that trades on the National Quotation Bureau's pink sheets. Mr. Stewart spends approximately 3% of his business time on our operations.
Term of Office
Our Directors are appointed for a one-year term to hold office until the next annual general meeting of our shareholders or until removed from office in accordance with our bylaws. Our officers are appointed by our board of directors and hold office until removed by the board.
Significant Employees
We have no significant employees other than the officers and directors described above.
Conflicts of Interest
We do not have any procedures in place to address conflicts of interest that may arise in our directors between our business and their other business activities.
Security Ownership Of Certain Beneficial Owners And Management
The following table provides the names and addresses of each person known to us to own more than 5% of our outstanding common stock as of March 21, 2003,and by the officers and directors, individually and as a group. Except as otherwise indicated, all shares are owned directly.
Amount of
Title of Name and address beneficial Percent
Class of beneficial owner ownership of class
--------- ------------------- ---------- --------
Common Strato Malamas 2,750,000 63.46%
Stock 4526 Underwood Avenue
North Vancouver, B.C.
Canada
Common Stewart A.Jackson NIL 0%
Stock P.O. Box 1085
Winterhaven CA
USA 92283-1085
James Michael Stewart NIL 0%
650 Timber Way
Highland Village, Texas
76067
Common All Officers and Directors 2,750,000 63.46%
Stock as a Group that consists of
three people
- ----------------------------------------------------------------------
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The percent of class is based on 4,319,893 shares of common stock issued and outstanding as of March 21, 2003.
Description Of Securities
General
Our authorized capital stock consists of 80,000,000 shares of common stock at a par value of $0.0001 per share and 20,000,000 shares of preferred stock at a par value of $0.0001 per share.
Common Stock
As of March 21, 2003,there were 4,319,893 shares of our common stock issued and outstanding that were held by thirty eight stockholders of record.
Holders of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of common stock voting for the election of directors can elect all of the directors. Holders of our common stock representing a majority of the voting power of our capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to our Articles of Incorporation.
Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally available funds. In the event of a liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock. Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to our common stock.
Dividend Policy
We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future.
Warrants
We have not issued and do not have outstanding any warrants to purchase shares of our common stock.
Options
We have not issued and do not have outstanding any options to purchase shares of our common stock.
Convertible Securities
We have not issued and do not have outstanding any securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock.
Interests Of Named Experts And Counsel
No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus 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 the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
The financial statements included in this prospectus and the registration statement have been audited by PKF, chartered accountants, to the extent and for the periods set forth in their report appearing elsewhere in this document and in the registration statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.
Disclosure Of Commission Position Of Indemnification For Securities Act Liabilities
Our directors and officers are indemnified as provided by the Delaware Revised Statutes and our Bylaws. We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act is against public policy as expressed in the Securities act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to court of appropriate jurisdiction. We will then be governed by the court's decision.
Organization Within Last Five Years
We were incorporated on May 2, 2001 under the laws of the state of Delaware. On that date, Strato Malamas was appointed as our president, chief executive officer, chief financial officer, secretary, treasurer and sole director.
On February 19, 2002, Stewart Jackson and James Michael Stewart were appointed as our directors.
Description Of Business
In General
We are an exploration stage oil and gas company. We plan to ultimately engage in the acquisition and exploration of oil and gas properties and to exploit oil and gas reserves we discover that demonstrate economic feasibility. We own a 1% working interest, and corresponding 0.78% net revenue interest in an oil and gas lease covering 40 acres located three miles south of Tolar, Hood
County, Texas, known as the Tolar Property. In addition, we have acquired a 25% working interest and corresponding 19.5% net revenue interest in a 111.89-acre lease located in Hood County, known as the Hood County Prospect.
Our plan of operations is to participate in the drilling of exploratory wells on the Tolar Property and Hood County Prospect in order to ascertain whether these properties possess commercially exploitable reserves of oil or natural gas. There can be no assurance that a commercially exploitable oil and gas reserve exists on either property until test wells are drilled on each of them.
Tolar Property
Pursuant to an Assignment of Oil and Gas Lease dated April 18, 2002, we acquired an undivided 1% working interest, and corresponding 0.78% net revenue interest in an oil and gas lease covering 40 acres located three miles south of Tolar, Hood County, Texas for consideration of $7,500 paid to International Oil & Gas, Inc., a private Delaware company. One of our directors, James Michael Stewart, acts as the president of International Oil & Gas, Inc.
In order to maintain our 1% working interest in the property, we are required to fund 1% of all costs associated will the drilling of a test well on the property. The cost of this test well is estimated to be $463,547. Accordingly, our share of these estimated costs will be approximately $ 4,635. It is anticipated that this test well will be drilled in fall of 2003.
If the test well is successful and we encounter sufficient quantities of oil or natural gas, the drilling participants will tie-in the well to nearby pipelines. We would then be entitled to receive 0.78% of all net revenue generated by the well. If the test well does not result in the discovery of commercial quantities of oil or gas, we will abandon our interest in the Tolar Property.
Hood County Prospect
Pursuant to a separate Farmout Agreement dated March 10, 2002, as amended, we paid $17,500 to International Oil & Gas, Inc. in consideration of it granting to us a 25% working interest and corresponding 19.5% net revenue interest in a 111.89 acre land parcel located in Hood County, Texas. One of our directors, James Michael Stewart, acts as president of International Oil & Gas, Inc.
In order to maintain our 25% working interest in the property, we are required to fund 25% of all costs associated with the drilling of a test well on the property. The cost of this test well is estimated to be $464,000. Accordingly, our share of these estimated costs will be approximately $116,000.
Our agreement with International Oil & Gas, Inc. requires us to commence, or cause to be commenced, the drilling of the well by February 15, 2004. Subject to our ability to raise sufficient financing for the test well, it is anticipated that this test well will be drilled in fall of 2003.
If the test well is successful and we encounter sufficient quantities of oil or natural gas, the drilling participants will tie-in the well to nearby
pipelines. We would then be entitled to receive 19.5% of all net revenue generated by the well. If the test well does not result in the discovery of commercial quantities of oil or gas, we will abandon our interest in the Hood County Prospect.
Location and History of Oil and Gas Properties
The Tolar Property and the Hood County Prospect are located approximately three miles south of the town of Tolar in southwestern Hood County, Texas. The area is bound by the Hood County line on the west and Highway 56 on the east. The north line is approximately one mile north of Highway 377 near Tolar, Texas and extends to the town of Paluxy on the south.
The site is located in the Fort Worth Basin that was formed by plate tectonic activity from the southeast as the South American plate pushed against the North American plate. This caused a bending down of the Texas Craton into a trench or basin. The entire region was submerged in water, and shales and limestones were deposited over the entire area. The organic rich fractured shales are a source and storage site for absorbed gas. The Barnett Shale, which underlies the Hood County properties, is the reservoir for continuous gas accumulation.
The Barnett Shale is a proven productive organic rich formation. The Southwest Tolar area is considered to be a probable and favorable Barnett Shale site due to the presence of faults, fractures, structures and good nearby Barnett Shale Zones.
Compliance with Government Regulation
Currently, governmental regulations do not materially restrict the exploration and development of oil and natural gas wells in Texas. However, the legal and regulatory framework that pertains to the Texas oil and gas industry may change. Uncertainty and new regulations could increase our costs of doing business and prevent us from becoming profitable.
The Texas Railroad Commission has enacted rules and regulations relating to plugging, abandonment, removal, disposal and restoration obligations that relate to oil and gas exploration. We will be responsible for our working interest share of these costs, which are included in the estimates of test well drilling expenses outlined above.
We will be required to register with the State of Texas in order to commence business operations in the state. The anticipated cost of the registration is $200.
Employees
We have no employees as of the date of this prospectus other than our three directors. None of our directors receive payment for their services.
Research and Development Expenditures
We have not incurred any research or development expenditures since our incorporation.
Subsidiaries
We do not have any subsidiaries.
Patents and Trademarks
We do not own, either legally or beneficially, any patents or trademarks.
Plan Of Operations
Our current business plan is to drill one test well on each of the Tolar Property and Hood County Prospect. Specifically, we anticipate spending the following over the next twelve months:
* $ 4,635, representing our portion of estimated costs associated with the drilling of a test well on the Tolar Property;
* $ 116,000 representing our portion of estimated costs associated with the drilling of a test well on the Hood County Prospect;
* $10,000 on professional fees, including legal and audit costs we expect to incur in connection with the filing of this registration statement;
* $5,000 on additional administrative expenses, including transfer agent costs, bank fees and office supply costs.
Total expenditures over the next twelve months are therefore expected to be approximately $180,000.
While we currently have sufficient cash on hand to cover our portion of anticipated drilling costs associated with the proposed test well for the Tolar Property, we will not be able to proceed with a test well on the Hood County Prospect without without additional financing.
We plan on proceeding with the Tolar Property and Hood County Prospect test wells in spring of 2003. However, the Hood County Prospect test well will be subject to us raising sufficient financing for our portion of anticipated expenses prior to that time.
Our cash reserves are not sufficient to meet our obligations for the next twelve-month period. As a result, we will need to seek additional funding in the near future. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We may also seek to obtain a short-term loan from our president, although no such arrangement has, as yet, been made. At this time, we cannot provide investors with any assurance that we will be able to raise sufficient funding from the sale of our common stock or through a loan from our president to meet our obligations over the next twelve months. We do not have any arrangements in place for any future equity financing.
If we do not complete the exploration expenditures required under the farm-out agreement for the Hood County Prospect, we will lose all our interest in the property. If we do not secure additional financing to drill the test well, we may consider bringing in a joint venture partner to provide the required funding. We have not undertaken any efforts to locate a joint venture partner. In addition, we cannot provide investors with any assurance that we will be
able to locate a joint venture partner who will assist us in funding the exploration of the Hood County Prospect. In such event, we would likely have to transfer or assign part of our interest in the property to the joint venture partner.
Results Of Operations For Period Ended December 31, 2002
We have not earned any revenues, other than nominal bank interest of $83, from our incorporation on May 2, 2001 to December 31, 2002. Our activities have been financed from the proceeds of share subscriptions and from advances from our president totalling $20,000. We do not anticipate earning revenues until such time as we have completed the test wells on the Tolar Property and Hood County Prospect. We can provide no assurance that we will discover commercially exploitable amounts or oil or gas on our properties.
We incurred operating expenses in the amount of $40,207 for the period from inception to December 31, 2002. These operating expenses consisted of cash payment of $12,500 relating to our acquisition of working interests in the Tolar Property and Hood County Prospect, legal and accounting fees totaling $ 7,665, consulting fees of $20,954, transfer agent fees of $1,333, licenses and permit fees of $297, bank charges of $158, oil and gas well operating expenses of $55 and office costs of $42.
We have not attained profitable operations and are dependent upon obtaining financing to pursue exploration activities. For these reasons our auditors stated in their report that they have substantial doubt that we will be able to continue as a going concern.
At December 31, 2002, we had assets recorded at $55,938 consisting of cash of $19,220 and a promissory note receivable of $36,718 from our former consultant. The note is a non-interest bearing demand note, which for accounting purposes, was valued using an interest rate of 12% over the expected collection period, estimated to be three years. During the period ended July 31, 2002, the consulting contract was terminated and the consultant agreed to pay back the $49,000 that was originally paid to him. The consultant is required to pay this amount upon demand. The amount due does not bear interest.
Our liabilities at December 31, 2002 totalled $24,500 and consisted of a non-interest bearing, demand loan of $20,000 from Strato Malamas, our president and accounts payable totalling $4,500.
Description Of Property
Our executive offices are located at 4526 Underwood Avenue, North Vancouver, British Columbia, Canada. Mr. Strato Malamas, our president, provides this office space to us free of charge.
Certain Relationships And Related Transactions
None of the following parties has, since our date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:
* Any of our directors or officers;
* Any person proposed as a nominee for election as a director;
* Any person who beneficially owns, directly or indirectly, shares
carrying more than 10% of the voting rights attached to our
outstanding shares of common stock;
* Any of our promoters;
* Any relative or spouse of any of the foregoing persons who has the
same house as such person.
Mr. Strato Malamas, our president and a director, has loaned a total of $20,000 to us for business operations costs. These loans have no fixed terms of repayment and accrue no interest. Mr. Malamas intends to request repayment of these loans when we are in a position to repay them.
Market For Common Equity And Related Stockholder Matters
No Public Market for Common Stock
There is presently no public market for our common stock. We anticipate applying for trading of our common stock on the over the counter bulletin board upon the effectiveness of the registration statement of which this prospectus forms a part. However, we can provide no assurance that our shares will be traded on the bulletin board or, if traded, that a public market will materialize.
Stockholders of Our Common Shares
As of the date of this registration statement, we had 38 registered shareholders.
Rule 144 Shares
A total of 2,750,000 shares of our common stock held by our president, Mr. Strato Malamas, were available for resale to the public after May 15, 2002 in accordance with the volume and trading limitations of Rule 144 of the Act. In general, under Rule 144 as currently in effect, a person who has beneficially owned shares of a company's common stock for at least one year is entitled to sell within any three month period a number of shares that does not exceed the greater of:
1. 1% of the number of shares of the company's common stock then outstanding which, in our case, will equal approximately 117,188 Shares as of the date of this prospectus; or
2. the average weekly trading volume of the company's common stock during the four calendar weeks preceding the filing of a notice on form 144 with respect to the sale.
Sales under Rule 144 are also subject to manner of sale provisions and notice requirements and to the availability of current public information about the company.
Under Rule 144(k), a person who is not one of the company's affiliates at any time during the three months preceding a sale, and who has beneficially owned the shares proposed to be sold for at least two years, is entitled to sell shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.
As of the date of this prospectus, persons who are our affiliates hold all of the 2,750,000 shares that may be sold pursuant to Rule 144.
Stock Option Grants
To date, we have not granted any stock options.
Registration Rights
We have not granted registration rights to the selling shareholders or to any other persons.
Dividends
There are no restrictions in our articles of incorporation or bylaws that prevent us from declaring dividends. The Delaware Revised Statutes, however, do prohibit us from declaring dividends where, after giving effect to the distribution of the dividend:
1. we would not be able to pay our debts as they become due in the usual course of business; or
2. our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.
We have not declared any dividends, and we do not plan to declare any dividends in the foreseeable future.
Executive Compensation
Summary Compensation Table
The table below summarizes all compensation awarded to, earned by, or paid to our executive officers by any person for all services rendered in all capacities to us for the fiscal period ended July 31, 2002.
Annual Compensation
Dir.
Stewart ., 2002 $0 0 0 0 0 0
Jackson Dir.
James
Stewart Dir. 2002 $0 0 0 0 0 0
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Stock Option Grants
We did not grant any stock options to the executive officers during our most recent fiscal year ended July 31, 2002. We have also not granted any stock options to the executive officers since July 31, 2002.
Consulting Agreements
We do not have any employment or consulting agreement with Mr. Malamas. We do not pay Mr. Malamas any amount for acting as a director.
We do not have any employment or consulting agreement with Mr. Jackson. We do not pay Mr. Jackson any amount for acting as a director of the Company.
We do not have any employment or consulting agreement with Mr. Stewart. We do not pay Mr. Stewart any amount for acting as a director of the company.
Financial Statements
Index to Financial Statements:
1. Auditors' Report;
2. Financial Statements for the year ended July 31, 2002, and 2001 and the interim five-month period ending December 31, 2002 and 2001 and the period from inception (May 2, 2001) to December 31, 2002 including:
a. Balance Sheet
b. Statement of Operations
c. Statement of Stockholders' Equity
d. Statement of Cash Flows
e. Notes to Financial Statements
Changes In And Disagreements With Accountants
We have had no changes in or disagreements with our accountants.
Available Information
We have filed a registration statement on form SB-2 under the Securities Act of 1933 with the Securities and Exchange Commission with respect to the shares of our common stock offered through this prospectus. This prospectus is filed as a part of that registration statement, but does not contain all of the information contained in the registration statement and exhibits. Statements made in the registration statement are summaries of the material terms of the referenced contracts, agreements or documents of the company. We refer you to our registration statement and each exhibit attached to it for a
more detailed description of matters involving the company, and the statements
we have made in this prospectus are qualified in their entirety by reference
to these additional materials. You may inspect the registration statement,
exhibits and schedules filed with the Securities and Exchange Commission at
the Commission's principal office in Washington, D.C. Copies of all or any
part of the registration statement may be obtained from the Public Reference
Section of the Securities and Exchange Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for
further information on the operation of the public reference rooms. The
Securities and Exchange Commission also maintains a web site at
http://www.sec.gov that contains reports, proxy statements and information
regarding registrants that file electronically with the Commission. Our
registration statement and the referenced exhibits can also be found on this
site.
Indemnification Of Directors And Officers
Our officers and directors are indemnified as provided by the Delaware Revised Statutes and our bylaws.
Under the NRS, director immunity from liability to a company or its shareholders for monetary liabilities applies automatically unless it is specifically limited by a company's articles of incorporation that is not the case with our articles of incorporation. Excepted from that immunity are:
(1) a willful failure to deal fairly with the company or its
shareholders in connection with a matter in which the director
has a material conflict of interest;
(2) a violation of criminal law (unless the director had reasonable
cause to believe that his or her conduct was lawful or no
reasonable cause to believe that his or her conduct was
unlawful);
(3) a transaction from which the director derived an improper
personal profit; and
(4) willful misconduct.
Our bylaws provide that we will indemnify our directors and officers to the fullest extent not prohibited by Delaware law; provided, however, that we may modify the extent of such indemnification by individual contracts with our directors and officers; and, provided, further,that we shall not be required to indemnify any director or officer in connection with any proceeding (or part thereof) initiated by such person unless:
(1) such indemnification is expressly required to be made by law;
(2) the proceeding was authorized by our Board of Directors;
(3) such indemnification is provided by us, in our sole discretion,
pursuant to the powers vested us under Nevada law; or
(4) such indemnification is required to be made pursuant to the
bylaws.
Our bylaws provide that we will advance to 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, by reason of the fact that he is or was a director or officer, of the company, or is or was serving at the request of the company as a director or executive officer of
another company, partnership, joint venture, trust or other enterprise, prior to the final disposition of the proceeding, promptly following request therefore, all expenses incurred by any director or officer in connection with such proceeding upon receipt of an undertaking by or on behalf of such person to repay said amounts if it should be determined ultimately that such person is not entitled to be indemnified under our bylaws or otherwise.
Our bylaws provide that no advance shall be made by us to an officer of the company, except by reason of the fact that such officer is or was a director of the company in which event this paragraph shall not apply, in any action, suit or proceeding, whether civil, criminal, administrative or investigative, if a determination is reasonably and promptly made: (a) by the board of directors by a majority vote of a quorum consisting of directors who were not parties to the proceeding, or (b) if such quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, that the facts known to the decision-making party at the time such determination is made demonstrate clearly and convincingly that such person acted in bad faith or in a manner that such person did not believe to be in or not opposed to the best interests of the company.
Item 25. Other Expenses Of Issuance And Distribution
The estimated costs of this offering are as follows:
Securities and Exchange Commission registration fee $
Federal Taxes $ NIL
Transfer Agent Fees $ 1,500
Accounting fees and expenses $ 3,500
Legal fees and expenses $ 10,000
Edgar filing fees $ 1,000
--------
Total $
========
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All amounts are estimates other than the Commission's registration fee.
We are paying all expenses of the offering listed above. No portion of these expenses will be borne by the selling shareholders. The selling shareholders, however, will pay any other expenses incurred in selling their common stock, including any brokerage commissions or costs of sale.
Recent Sales Of Unregistered Securities
We issued 2,750,000 shares of common stock on February 22, 2001 to Mr. Strato Malamas. Mr. Malamas is one of our directors and is our president and chief executive officer and secretary, treasurer. Mr. Malamas acquired 2,750,000 shares at a price of $0.0002 per share for total proceeds to us of $550.00. These shares were issued pursuant to Section 4(2) of the Securities Act of 1933 (the "Securities Act") and are restricted shares as defined in the Securities Act.
We initiated an offering of 2,750,000 shares of our common stock at a price of $0.05 per share of which 1,569,893 shares were subscribed for to a total of thirty seven purchasers between March 1, 2001 and April 30, 2001.
The total amount received from this offering was $78,315. The offering was pursuant to Regulation S of the Securities Act. Each purchaser represented to us that he was a non-US person as defined in Regulation S. We did not engage in a distribution of this offering in the United States. Each purchaser represented his intention to acquire the securities for investment only and not with a view toward distribution. Appropriate legends were affixed to the stock certificate issued to each purchaser in accordance with Regulation S. Each investor was given adequate access to sufficient information about us to make an informed investment decision. None of the securities were sold through an underwriter and accordingly, there were no underwriting discounts or commissions involved. No registration rights were granted to any of the
purchasers
Exhibits
Exhibit
Number Description
------------- --------------------
1.1 Certificate of Incorporation
2.1 By-Laws
4.1 Share Certificate
5.1 Opinion of Arthur J. Frost, Attorney at Law, with
consent to use
5.2 Assignment of Oil and Gas Lease dated Option Agreement
dated March 15, 2002
5.3 Farmout Agreement dated March 10, 2002
6.1 Consent of PKF, Chartered Accountants
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Undertakings
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:
(a) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(b) To reflect in the prospectus any facts or events arising after the effective date of this registration statement, or most recent post-effective amendment, which, individually or in the aggregate, represent a fundamental change in the information set forth in this registration statement; and
(c) To include any material information with respect to the plan of distribution not previously disclosed in this 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, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, 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 hereby which remain unsold at the termination of the offering.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the successful defense of any action, suit or proceeding, is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we 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 is against public policy as expressed in the Securities Act, and we will be governed by the final adjudication of such issue.
Signatures
In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form SB-2 and authorized this registration statement to be signed on its behalf by the undersigned, in the City of Vancouver, Province of British Columbia on March 21, 2003.
GoEnergy, Inc.
By:/s/ Strato Malamas
-------------------------
Strato Malamas, President
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Power of Attorney
ALL MEN BY THESE PRESENT, that each person whose signature appears below constitutes and appoints Strato Malamas, his true and lawful attorney-in-fact and agent, with full power of substitution and re-substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all pre- or post-effective amendments to this registration statement, and to file the same with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any one of them, or their or his substitutes, may lawfully do or cause to be done by virtue hereof.
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated.
In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated.
SIGNATURE CAPACITY IN WHICH SIGNED DATE
/S/ Strato Malamas President, Chief Executive March 21, 2003
---------------------- Officer, Chief Financial
Strato Malamas Officer, Secretary, Treasurer
and director
/s/ Stewart A. Jackson Director March 21, 2003
----------------------
Stewart A. Jackson
/s/ James Michael Stewart Director March 21, 2003
----------------------
James Michael Stewart
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GOENERGY, INC.
(A Pre-Exploration Stage Company)
Financial Statements
July 31, 2002 and 2001 and December 31, 2002 (unaudited)
(U.S. Dollars)
INDEX Page ----- ---- Report of Independent Chartered Accountants 1 Financial Statements Balance Sheets 2 Statements of Operations 3 Statements of Stockholders' Equity 4 Statements of Cash Flows 5 Notes to Financial Statements 6-9 |
Pannell Kerr Forster PKF Worldwide |
7th Floor, Marine Building 355 Burrard St., Vancouver, B.C., Canada, V6C 2G8 Telephone: (604)687-1231 Facsimile:(604)688-4675
REPORT OF INDEPENDENT CHARTERED ACCOUNTANTS
TO THE BOARD OF DIRECTORS
OF GOENERGY, INC.
(A Pre-Exploration Stage Company)
We have audited the balance sheets of GoEnergy, Inc. (A Pre-Exploration Stage Company) as at July 31,2002 and 2001 and the related statements of operations, stockholders' equity and cash flows for the yearended July 31, 2002 and for the period from inception (May 2, 2001) through July 31, 2001. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinionon these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, these financial statements present fairly, in all material respects, the financial position of the Company as at July 31, 2002 and 2001 and the results of its operations and its cash flows for the periods referred to above in conformity with accounting principles generally accepted in the United States of America.
These financial statements have been prepared assuming the Company will continue as a going concern.As discussed in note 2 to the financial statements, the Company has had no operations and has no established source of revenue and needs additional financing in order to complete its business plan. This raises substantial doubt about its ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.
"Pannell Kerr Forster"
Chartered Accountants
Vancouver, Canada
October 8, 2002 Except note (8)(iii)
Which is as at March 3, 2003
GOENERGY, INC.
(A Pre-Exploration Stage Company)
Balance Sheets
July 31
(U.S. Dollars)
----------------------------------------------------------------------------------------------
December 31, July 31,
2002 2002 2001
----------------------------------------------------------------------------------------------
(unaudited)
Assets
Current
Cash $ 19,220 $ 19,740 $ 36,455
Promissory Note Receivable (note 4) 36,718 34,936 0
----------------------------------------------------------------------------------------------
Total Assets $ 55,938 $ 54,676 $ 36,455
==============================================================================================
Liabilities
Current
Accounts payable and accrued liabilities $ 4,500 $ 3,000 $ 3,300
Due to a shareholder (note 6) 20,000 20,000 0
----------------------------------------------------------------------------------------------
Total Liabilities 24,500 23,000 3,300
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Commitment (note 4)
Stockholders' Equity (notes 5 and 9)
Common Stock and Paid-in Capital in
Excess of $0.0001 Par value
Authorized
80,000,000 Common shares with a
par value of $0.0001 each
20,000,000 Preferred shares with a
par value of $0.0001 each
Issued and outstanding
4,319,893 (July 2002 - 4,319,893;
July 2001 - 4,266,293)
common shares 71,645 71,645 68,965
Accumulated Deficit (40,207) (39,969) (35,810)
----------------------------------------------------------------------------------------------
Total Stockholders' Equity 31,438 31,676 33,155
----------------------------------------------------------------------------------------------
Total Liabilities and Stockholders' Equity $ 55,938 $ 54,676 $ 36,455
==============================================================================================
|
See notes to financial statements.
GOENERGY, INC.(A Pre- Exploration Stage Company)
Statements of Operations
(U. S. Dollars)
--------------------------------------------------------------------------------------------------------
Period from Period from
Inception Inception
(May 2, (May 2,
Year Ended 2001) to 2001) to
Five Months Ended December 31, July 31, July 31, December 31,
2002 2001 2002 2001 2002
--------------------------------------------------------------------------------------------------------
(unaudited) (unaudited) (unaudited)
Interest income $( 1,863) $0 $( 890) $0 $( 2,753)
Resource property
expenditures (note 8) 55 0 12,500 0 12,555
Professional fees 1,500 965 5,365 800 7,665
Transfer agent fees 250 0 1,083 0 1,333
Bank charges 41 16 05 10 156
Office 255 42 42 0 297
Consulting fees (note 4) 0 25,000 (14,046) 35,000 20,954
--------------------------------------------------------------------------------------------------------
Net Loss $( 238) $( 26,023) $( 4,159) $( 35,810) $( 40,207)
========================================================================================================
Weighted Average Number of
Common Shares Outstanding 4,319,893 4,291,559 4,291,559 3,044,886
========================================================================================================
Net Loss Per Share $ (0.000) $ (0.006) $ (0.001) $ (0.012)
========================================================================================================
|
See notes to financial statements.
GOENERGY, INC.
(A Pre-Exploration Stage Company)
Statements of Stockholders' Equity
(U.S. Dollars)
-----------------------------------------------------------------------------------------------
Total
Common Stock * Accumulated Stockholders'
Number Amount Deficit Equity
-----------------------------------------------------------------------------------------------
Issuances of Common Stock
For cash
- Founder's shares, at inception 5,500,000 $550 $0 $550
- Shares, private placement 1,566,293 78,315 0 78,315
- Finder's fee 0 (7,400) 0 (7,400)
Net loss for period 0 0 (35,810) (35,810)
------------------------------------------------------------------------------------------------
Balance, July 31, 2001, as
previously recorded 7,066,293 71,465 (35,810) 35,655
Prior period adjustment (note 9)
Shares issued in error (2,800,000) (2,500) 0 (2,500)
------------------------------------------------------------------------------------------------
Balance, July 31, 2001,
as restated 4,266,293 68,965 (35,810) 33,155
Common stock
Issued for cash, private
placement 53,600 2,680 0 2,680
Net loss for year 0 0 (4,159) (4,159)
------------------------------------------------------------------------------------------------
Balance, July 31, 2002 4,319,893 71,645 (39,969) 31,676
Net Loss for period (unaudited) 0 0 (238) (238)
------------------------------------------------------------------------------------------------
Balance, December 31, 2002
(unaudited) 4,319,893 $71,645 $(40,207) $31,438
================================================================================================
|
* Common stock and additional paid-in capital in excess of $0.0001 par value
See notes to financial statements.
GOENERGY, INC.(A Pre- Exploration Stage Company)
Statements of Cash Flows
(U. S. Dollars)
----------------------------------------------------------------------------------------------------------------------
Period from Period from
Inception Inception
(May 2, (May 2,
Year Ended 2001) to 2001) to
Five Months Ended December 31, July 31, July 31, December 31,
2002 2001 2002 2001 2002
----------------------------------------------------------------------------------------------------------------------
(unaudited) (unaudited) (unaudited)
Operating Activities
Net loss $( 238) $( 26,023) $( 4,159) $( 35,810) $( 40,207)
Items not involving cash
Recovery of consulting fees 0 0 (34,936) 0 (34,936)
Change in working capital items
Promissory note receivable (1,782) 0 0 0 (1,782)
Prepaid expenses 0 (500)
Accounts payable and accrued liabilities 1,500 (2,500) (300) 3,300 4,500
----------------------------------------------------------------------------------------------------------------------
Cash Used in Operating Activities (520) (29,023) (39,395) (32,510) (72,425)
----------------------------------------------------------------------------------------------------------------------
Financing Activities
Shareholder advance 0 0 20,000 0 20,000
Common shares issued 0 0 2,680 68,965 71,645
----------------------------------------------------------------------------------------------------------------------
Cash Provided by Financing Activities 0 0 22,680 68,965 91,645
----------------------------------------------------------------------------------------------------------------------
Inflow (Outflow) of Cash (520) (29,023) (16,715) 36,455 19,220
Cash, Beginning of Period 19,740 36,455 36,455 0 0
----------------------------------------------------------------------------------------------------------------------
Cash, End of Period $19,220 $7,432 $19,740 $36,455 $19,220
======================================================================================================================
|
See notes to financial statements.
GOENERGY, INC.
(A Pre-Exploration Stage Company)
1. ORGANIZATION AND NATURE OF OPERATIONS The Company was incorporated May 2, 2001 in the State of Delaware and is in the pre-exploration stage. The Company has been primarily involved in organizational activities and has obtained an interest in certain oil and gas wells (note 8) and intends to carry out exploration work thereon.
2. GOING CONCERN The Company's financial statements are prepared using the accounting principles generally accepted in the United States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company's current operating funds are less than necessary to complete the exploration of the optioned oil and gas interest, and therefore will need to obtain additional financing in order to complete its business plan. As of December 31, 2002, the Company had cash in the amount of $19,220.The Company does not have any operations nor does it have any income. Its business plan calls for significant expenses in connection with the exploration of its optioned oil and gas interest (note 8). The Company does not currently have any arrangements for financing and can not provide any assurance it will be able to find such financing if required. An alternative for the financing of further exploration would be the offering of an interest in the Company's oil and gas interest to be earned by another party or parties carrying out further exploration thereof, which is not presently contemplated. If the Company does not complete the required option payments mandated in its option, it will lose its interest in the Hood County, Texas well and its business will fail.
3. SIGNIFICANT ACCOUNTING POLICIES
(a) Pre-exploration expenditures The Company is in the pre-exploration stage. All exploration expenditures are expensed as they are incurred.
(b) Net loss per share Net loss per share computations are based on the weighted average number of common shares outstanding during the period.
3. SIGNIFICANT ACCOUNTING POLICIES (Continued)
(c) Financial instruments
The Company's financial instruments consist of cash, promissory note receivable, accounts payable and accrued liabilities and amount due to shareholder. It is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments and the carrying amounts of these financial instruments approximate their fair values at the balance sheet dates.
Non-interest bearing notes receivable with no terms of repayment have been recorded in accordance with APB 21, whereby imputed interest is calculated over the expected period of collection of such notes (note 4).
(d) Use of estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and would impact future results of operations and cash flows.
4. PROMISSORY NOTE RECEIVABLE AND COMMITMENT
At July 31, 2001, the Company was committed to pay $85,000 to an independent consultant to take the Company public. As at July 31, 2002, the Company had paid $49,000, of which $14,000 was paid during the year ended July 31, 2002 and $35,000 was paid during the period from inception (May 2, 2001) to July 31, 2001. The contract was terminated during the year ended July 31, 2002 and the consultant agreed to repay the Company $49,000. The $49,000 promissory note receivable is expected to be repaid within 3 years, and accordingly, imputed interest has been calculated at a rate of 12% over 3 years.
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December 31, July 31,
2002 2002 2001
-------------------------------------------------------------------------------
(unaudited)
Non-interest bearing note $49,000 $49,000 $0
Less: Unamortied discount
based on 3 years (12,282) (14,064) 0
-------------------------------------------------------------------------------
|
5. COMMON STOCK
In May, 2001, the Company issued 2.75 million shares of common stock at a price of $0.0002 per share to the founder of the Company for proceeds of $550 (note 9).
During the period from inception (May 2, 2001) to July 31, 2001, the Company also arranged a private placement of up to 2.75 million shares of common stock at $0.05 per share.All common stock issued under the private placement are "restricted securities" as defined in Rule 144 of the United States of America Securities Act of 1933. As of July 31, 2001, the Company had issued 1,566,293 common shares for proceeds of $78,315. As part of arranging the private placement, the Company was charged a finder's fee of $7,400 (note 9).
During the year ended July 31, 2002, as part of the private placement above, the Company issued 53,600 shares of common stock for proceeds of $2,680.
6. RELATED PARTY TRANSACTIONS
(a) During the year a shareholder, a director and the President of the Company, advanced funds to the Company in the way of a non-interest bearing demand loan for the Company to fulfill its operating obligations. Advances due to the shareholder at July 31, 2002 and December 31, 2002 amount to $20,000.
(b) Office space is provided by the president of the Company, free of charge.
(c) During the year ended July 31, 2002, the Company acquired certain resource interests from a company whose president is also a director of the Company (note 8).
7. INCOME TAXES
-------------------------------------------------------------------------------
December 31, July 31, July 31,
2002 2002 2001
-------------------------------------------------------------------------------
Deferred tax asset (unaudited)
Approximate net operating losses $28,000 $26,000 $35,500
Approximate tax rate 35% 35% 35%
-------------------------------------------------------------------------------
9,800 9,100 12,500
Valuation allowance (9,800) (9,100) (12,500)
-------------------------------------------------------------------------------
Deferred tax asset $0 $0 $0
===============================================================================
|
The valuation allowance reflects the Company's estimate that the tax assets, more likely than not, willnot be realized.
The Company has net operating losses of approximately $28,000 which will expire between 2021 and 2022.
8. EXPLORATION EXPENDITURES
(a) During the year ended July 31, 2002, the Company purchased from International Oil & Gas,Inc. ("International"), a Texas company, a 1% working interest and 0.78% net revenue interest in an oil and gas lease in the wellbore and production of the Mesa Wood No. 1 property, Texas. Total consideration was $7,500 and the Company is to bear 1% of the working interest costs.
(b) By letter agreement dated March 10, 2002, the Company acquired an option from International whereby the Company may acquire a 25% working interest and a 19.5% net revenue interest in an oil and gas well to be drilled in Hood County, Texas. Total consideration for this option is $10,000 and the Company is to bear all costs associated with the drilling, testing, completing and equipping of the well. Drilling must commence on or before October 31, 2002 and be completed within 120 days from commencement. The terms of payment of the consideration are as follows:
(i) payment of $2,500 upon signing of the agreement (paid);
(ii) payment of $2,500, on or before May 30, 2002 (paid); and
(iii) payment of $5,000 by the earlier of commencement of drilling and
October 31, 2002 (payment of the $5,000 by October 31, 2002 will
extend the date drilling must commence from October 31, 2002 to on
or before February 15, 2003). By an agreement dated February 13,
2003, between the Company and International, for consideration of
the $5,000 and an additional $2,500 (both amounts were paid February
27, 2003) the date the Company must commence drilling is extended to
February 15, 2004.
9. PRIOR PERIOD ADJUSTMENT
During the year ended July 31, 2002, the Company:
(i) issued, in error, 5.5 million common shares at $0.0001 instead of 2.75
million common shares at $0.0002 as stated in note 5;
(ii) collected $2,500 as consideration for a subscription agreement to issue
50,000 common shares. The common shares were recorded as issued as at
July 31, 2001. The subscription agreement was cancelled during 2001 and
the $2,500 was returned to the subscriber during the year ended July 31,
2002.
The 2.8 million common shares have been cancelled and retroactively restated as unissued shares.
CERTIFICATE OF INCORPORATION
OF
FIRST. The name of this corporation shall be:
GOENERGY, INC.
SECOND. Its registered office in the State of Delaware is to be located at 2711 Centerville Road, Suite 400, in the City of Wilmington, County of New Castle, 19808, and its registered agent at such address is THE COMPANY CORPORATION.
THIRD. The purpose or purposes of the corporation shall be:
To engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of Delaware.
FOURTH. The total number of shares of stock which this corporation is authorized to issue is:
One Hundred Million (100,000,000) shares of which Eighty Million (80,000,000) shares with a par value of $0.0001 each, amounting to Eight Thousand Dollars ($8,000) are Common Stock and Twenty Million (20,000,000) shares with a par value of $0.0001 each, amounting to Two Thousand Dollars ($2,000) are Preferred Stock.
FIFTH. The name and mailing address of the incorporator is as follows:
Shirley Jones
The Company Corporation
2711 Centerville Road, Suite 400 Wilmington, DE 19808
SIXTH. The Board of Directors shall have the power to adopt, amend or repeal the by-laws.
IN WITNESS WHEREOF, The undersigned, being the incorporator hereinbefore named, has executed, signed and acknowledged this certificate of incorporation this second day of May, A.D. 2001.
/s/ Shirley Jones ------------------------ Shirley Jones Incorporator |
BYLAWS
OF
GoENERGY INC.
(a Delaware corporation)
ARTICLE I
1. CERTIFICATES REPRESENTING STOCK. Certificates representing stock in the corporation shall be signed by, or in the name of, the corporation by the Chairperson or ViceChairperson of the Board of Directors, if any, or by the President or a Vice-President and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary of the corporation. A ny or all the signatures on any such 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 such person were such officer, transfer agent, or registrar at the date of issue.
Whenever the corporation shall be authorized to issue more than one class of stock or more than one series of any class of stock, and whenever the corporation shall issue any shares of its stock a s partly paid stock, the certificates representing shares of any such class or series or of any such partly paid stock shall set forth thereon the statements prescribed by the General Corporation Law. Any restrictions on the transfer or registration of transfer of any shares of stock of any class or series shall be noted conspicuously on the certificate representing such shares.
The corporation may issue a new certificate of stock or uncertificated shares in place of any certificate theretofore issued by it, alleged to have been lost, stolen, or destroyed, and the Board of Directors may require the owner of the lost, stolen, or destroyed certificate, or such owner's legal representative, to give the corporation a bond sufficient to indemnify the corporation against any claim that may be made against it on account of the alleged loss, theft, or destruction of any such certificate or the issuance of any such new certificate or uncertificated shares.
2. UNCERTIFICATED SHARES. Subject to any conditions imposed by the General Corporation Law, 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 General Corporation Law.
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 a 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 warrants aggregating a full share. A certificate for a fractional share or an uncertificated fractional share shall, but scrip or warrants 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.
4. STOCK TRANSFERS. Upon compliance with provisions restricting the transfer or registration of transfer of shares of stock, if any, transfers or registration of transfers of shares of stock of the corporation shall be made only on the stock ledger of the corporation by the registered holder thereof, or by the registered holder's attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the corporation or with a transfer agent or a registrar, if any, and, in the case of shares represented by certificates, on surrender of the certificate or certificates for such shares of stock properly endorsed and the payment of all taxes due thereon.
5. RECORD DATE FOR STOCKHOLDERS. 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, 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 record date shall not be more than sixty nor less than ten days before the date of such meeting. If no record date is fixed by the Board of Directors, 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, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. 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. 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 days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date has been fixed by the Board of Directors, the record date for determining the stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by the General Corporation 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 principal place of business or an officer or agent of the
corporation having custody of the book in which proceedings of meetings of stockholders are recorded. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by the General Corporation 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 day on which the Board of Directors adopts the resolution taking such prior action. In order that the corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders 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 a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto
6. MEANING OF CERTAIN TERMS. As used herein in respect of the right to notice of a meeting of stockholders or a waiver thereof or to participate or vote thereat or to consent or dissent in writing in lieu of a meeting, as the case may be, the term "share" or "shares" or "share of stock" or "shares of stock" or "stockholder" or "stockholders" refers to an outstanding share or shares of stock and to a holder or holders of record of outstanding shares of stock when the corporation is authorized to issue only one class of shares of stock, and said reference is also intended to include any outstanding share or shares of stock and any holder or holders of record of outstanding shares of stock of any class upon which or upon whom the certificate of incorporation confers such rights where there are two or more classes or series of shares of stock or upon which or upon whom the General Corporation Law confers such rights notwithstanding that the certificate of incorporation may provide for more than one class or series of shares of stock, one or more of which are limited or denied such rights thereunder; provided, however, that no such right shall vest in the event of an increase or a decrease in the authorized number of shares of stock of any class or series which is otherwise denied voting rights under the provisions of the certificate of incorporation, except as any provision of law may otherwise require.
7. STOCKHOLDER MEETINGS.
- TIME. The annual meeting shall be held on the date and at the time fixed, from time to time, by the directors, provided, that the first annual meeting shall be held on a date within thirteen months after the organization of the corporation, and each successive annual meeting shall be held on a date within thirteen months after the date of the preceding annual meeting. A special meeting shall be held on the date and at the time fixed by the directors.
- PLACE. Annual meetings and special meetings may be held at such place,
either within or without the State of Delaware, as the directors may, from time
to time, fix. Whenever the directors shall fail to fix such place, the meeting
shall be held at the registered office of the corporation in the State of
Delaware. The board of directors may also, in its sole discretion, determine
that the meeting shall not be held at any place, but may instead be held
solely by means of remote communication as authorized by Section 211(a)(2)
of the Delaware General Corporation Law. If a meeting by remote communication
is authorized by the board of directors in its sole discretion, and subject
to guidelines and procedures as the board of directors may adopt, stockholders
and proxyholders not physically present at a meeting of stockholders may, by
means of remote communication participate in a meeting of stockholders and be
deemed present in person and vote at a meeting of stockholders whether such
meeting is to be held at a designated place or solely by means of remote
communication, provided that (a) the corporation shall implement reasonable
measures to verify that each person deemed present and permitted to vote at
the meeting by means of remote communication is a stockholder or proxyholder,
(b) the corporation shall implement reasonable measures to provide such
stockholders and proxyholders a reasonable opportunity to participate in the
meeting and to vote on matters submitted to the stockholders, including an
opportunity to read or hear the proceedings of the meeting substantially
concurrently with such proceedings, and (c) if any stockholder or proxyholder
votes or takes other action at the meeting by means of remote communication,
a record of such vote or other action shall be maintained by the corporation.
- CALL. Annual meetings and special meetings may be called by the directors or by any officer instructed by the directors to call the meeting.
- NOTICE OR WAIVER OF NOTICE. Written notice of all meetings shall be given, which shall state the place, if any, date, and hour of the meeting, the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, and in the case of a special meeting, the purpose or purposes for which the meeting is called. The notice of an annual meeting shall state that the meeting is called for the election of directors and for the transaction of other business which may properly come before the meeting, and shall (if any other action which could be taken at a special meeting is to be taken at such annual meeting) state the purpose or purposes. The notice of any meeting shall also include, or be accompanied by, any additional statements, information, or documents prescribed by the General Corporation Law. Except as otherwise provided by the General Corporation Law, the written notice of any meeting shall be given not less than ten days nor more than sixty days before the date of the meeting to each stockholder entitled to vote at such meeting. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at such
stockholder=s address as it appears on the records of the corporation. If a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time, place, if any, thereof, and the means of remote communications, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such adjourned meeting 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 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. Whenever notice is required to be given under the Delaware General Corporation Law, certificate of incorporation or bylaws, a written waiver signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a stockholder at a meeting of stockholders shall constitute a waiver of notice of such meeting, except when the stockholder attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the certificate of incorporation or these bylaws.
- STOCKHOLDER LIST. The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten 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 for a period of at least ten days prior to the meeting on a reasonably accessible electronic network, provided that the informationrequired to gain access to such list is provided with the notice of the meeting or during ordinary business hours at the principal place of business of the corporation. In the event that the corporation determines to make the list available on an electronic network, the corporation may take reasonable steps to ensure that such information is available only to stockholders of the corporation. If the meeting is to be held at a place, then the list shall 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. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting. The stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by this section or the books of the corporation, or to vote in person or by proxy at any meeting of stockholders.
- CONDUCT OF MEETING. Meetings of the stockholders shall be presided over by one of the following officers in the order of seniority and if present and acting - the Chairperson of the Board, if any, the Vice-Chairperson of the Board, if any, the President, a Vice-President, or, if none of the foregoing is in office and present and acting, by a chairperson to be chosen by the stockholders. The Secretary of the corporation, or in such Secretary's absence, an Assistant Secretary, shall act as secretary of every meeting, but if neither the Secretary nor an Assistant
Secretary is present the chairperson of the meeting shall appoint a secretary of the meeting.
- PROXY REPRESENTATION. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder by proxy, but no such proxy shall be voted or acted upon after 3 years from its date, unless the proxy provides for a longer period. A stockholder may execute a writing authorizing another person or persons to act for such stockholder as proxy. Execution may be accomplished by the stockholder or such stockholder=s authorized officer, director, employee or agent signing such writing or causing such person=s signature to be affixed to such writing by any reasonable means including, but not limited to, by facsimile signature. A stockholder may also authorize another person or persons to act for such stockholder as proxy by transmitting or authorizing the transmission of a telegram, cablegram, or other means of electronic transmission to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such transmission, provided that any such telegram, cablegram or other means of electronic transmission must either set forth or be submitted with information from which it can be determined that the telegram, cablegram or other electronic transmission was authorized by the stockholder. If it is determined that such telegrams, cablegrams or other electronic transmissions are valid, the inspectors or, if there are no inspectors, such other persons making the determination shall specify the information upon which they relied. Any copy, facsimile telecommunication or other reliable reproduction of the writing or transmission created pursuant to Section 212(c) of the Delaware General Corporation Law may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing or transmission. 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 proxy may be made irrevocable regardless of whether the interest with which it is coupled is an interest in the stock itself or an interest in the corporation generally.
- INSPECTORS. The directors, in advance of any meeting, may, but need not, appoint one or more inspectors of election to act at the meeting or any adjournment thereof. If an inspector or inspectors are not appointed, the person presiding at the meeting may, but need not, appoint one or more inspectors. In case any person who may be appointed as an inspector fails to appear or act, the vacancy may be filled by appointment made by the directors in advance of the meeting or at the meeting by the person presiding thereat. Each inspector, if any, before entering upon the discharge of duties of inspector, shall take and sign an oath faithfully to execute the duties of inspector at such meeting with strict impartiality and according to the best of such inspector's ability. The inspectors, if any, shall determine the number of shares of stock outstanding and the voting power of each, the shares of stock represented at the meeting, the existence of a quorum, the validity and effect of proxies, and shall receive votes, ballots, or consents, hear and determine all challenges and questions arising in connection with the right to vote, count and tabulate all votes, ballots, or consents, determine the result, and do such acts as are proper to conduct the election or vote with fairness to all stockholders. On request of the person presiding at the meeting, the inspector or inspectors, if any, shall make a report in writing of any challenge, question, or matter
determined by such inspector or inspectors and execute a certificate of any fact found by such inspector or inspectors. Except as may otherwise be required by subsection (e) of Section 231 of the General Corporation Law, the provisions of that Section shall not apply to the corporation.
- QUORUM. The holders of a majority of the outstanding shares of stock shall constitute a quorum at a meeting of stockholders for the transaction of any business. The stockholders present may adjourn the meeting despite the absence of a quorum.
- VOTING. Each share of stock shall entitle the holder thereof to one vote. Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. Any other action shall be authorized by a majority of the votes cast except where the General Corporation Law prescribes a different percentage of votes and/or a different exercise of voting power, and except as may be otherwise prescribed by the provisions of the certificate of incorporation and these Bylaws. In the election of directors, and for any other action, voting need not be by ballot.
8. STOCKHOLDER ACTION WITHOUT MEETINGS. Except as any provision of the General Corporation Law may otherwise require, any action required by the General Corporation Law to be taken at any annual or special meeting of stockholders, or any action which may be taken at any annual or special meeting of 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. A telegram, cablegram or other electronic transmission consenting to an action to be taken and transmitted by a stockholder or proxyholder, or by a person or persons authorized to act for a stockholder or proxyholder, shall be deemed to be written, signed and dated for the purposes of this section, provided that any such telegram, cablegram or other electronic transmission sets forth or is delivered with information from which the corporation can determine that the telegram, cablegram or other electronic transmission was transmitted by the stockholder or proxyholder or by a person or persons authorized to act for the stockholder or proxyholder and the date on which such stockholder or proxyholder or authorized person or persons transmitted such telegram, cablegram or electronic transmission. The date on which such telegram, cablegram or electronic transmission is transmitted shall be deemed to be the date on which such consent was signed. No consent given by telegram, cablegram or other electronic transmission shall be deemed to have been delivered until such consent is reproduced in paper form and until such paper shall be delivered to the corporation by delivery to its principal place of business or an officer or agent of the corporation having custody of the book in which the proceedings of meetings of stockholders are recorded, to the extent and in the manner provided by resolution of the board of directors of the corporation.. Any copy, facsimile or other reliable reproduction of a consent in writing may be substituted or used in lieu of the original writing for any and all purposes for which the original writing could be used, provided that such copy, facsimile or other reproduction shall be a complete reproduction of the entire original writing. 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. Action taken pursuant to this paragraph shall be subject to the provisions of Section 228 of the General Corporation Law.
1. FUNCTIONS AND DEFINITION. The business and affairs of the corporation shall be managed by or under the direction of the Board of Directors of the corporation. The Board of Directors shall have the authority to fix the compensation of the members thereof. The use of the phrase "whole board" herein refers to the total number of directors which the corporation would have if there were no vacancies.
2. QUALIFICATIONS AND NUMBER. A director need not be a stockholder, a citizen of the United States, or a resident of the State of Delaware. The initial Board of Directors shall consist of persons. Thereafter the number of directors constituting the whole board shall be at least one. Subject to the foregoing limitation and except for the first Board of Directors, such number may be fixed from time to time by action of the stockholders or of the directors, or, if the number is not fixed, the number shall be . The number of directors may be increased or decreased by action of the stockholders or of the directors.
3. ELECTION AND TERM. The first Board of Directors, unless the members thereof shall have been named in the certificate of incorporation, shall be elected by the incorporator or incorporators and shall hold office until the first annual meeting of stockholders and until their successors are elected and qualified or until their earlier resignation or removal. Any director may resign at any time upon notice given in writing or by electronic transmission to the corporation. Thereafter, directors who are elected at an annual meeting of stockholders, and directors who are elected in the interim to fill vacancies and newly created directorships, shall hold office until the next annual meeting of stockholders and until their successors are elected and qualified or until their earlier resignation or removal. Except as the General Corporation Law may otherwise require, in the interim between annual meetings of stockholders or of special meetings of stockholders called for the election of directors and/or for the removal of one or more directors and for the filling of any vacancy in that connection, newly created directorships and any vacancies in the Board of Directors, including unfilled vacancies resulting from the removal of directors for cause or without cause, may be filled by the vote of a majority of the remaining directors then in office, although less than a quorum, or by the sole remaining director.
4. MEETINGS.
- TIME. Meetings shall be held at such time as the Board shall fix, except that the first meeting of a newly elected Board shall be held as soon after its election as the directors may conveniently assemble.
- PLACE. Meetings shall be held at such place within or without the State of Delaware as shall be fixed by the Board.
- CALL. No call shall be required for regular meetings for which the time and place have been fixed. Special meetings may be called by or at the
direction of the Chairperson of the Board, if any, the Vice-Chairperson of the Board, if any, of the President, or of a majority of the directors in office.
- NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be required for regular meetings for which the time and place have been fixed. Written, oral, or any other mode of notice of the time and place shall be given for special meetings in sufficient time for the convenient assembly of the directors thereat. Whenever notice is required to be given under the Delaware General Corporation Law, certificate of incorporation or bylaws, a written waiver signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of any such person at a meeting shall constitute a waiver of notice of such meeting, except when such 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 not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the directors need be specified in any written waiver of notice.
- QUORUM AND ACTION. A majority of the whole Board shall constitute a quorum except when a vacancy or vacancies prevents such majority, whereupon a majority of the directors in office shall constitute a quorum, provided, that such majority shall constitute at least one-third of the whole Board. A majority of the directors present, whether or not a quorum is present, may adjourn a meeting to another time and place. Except as herein otherwise provided, and except as otherwise provided by the General Corporation Law, the vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board. The quorum and voting provisions herein stated shall not be construed as conflicting with any provisions of the General Corporation Law and these Bylaws which govern a meeting of directors held to fill vacancies and newly created directorships in the Board or action of disinterested directors.
Any member or members of the Board of Directors or of any committee designated by the Board, may participate in a meeting of the Board, or any such committee, as the case may be, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other.
- CHAIRPERSON OF THE MEETING. The Chairperson of the Board, if any and if present and acting, shall preside at all meetings. Otherwise, the Vice-Chairperson of the Board, if any and if present and acting, or the President, if present and acting, or any other director chosen by the Board, shall preside.
5. REMOVAL OF DIRECTORS. Except as may otherwise be provided by the General Corporation Law, any director or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors.
6. COMMITTEES. The Board of Directors may 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 any member of any such committee or committees, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board, 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 with the exception of any power or authority the delegation of which is prohibited by Section 141 of the General Corporation Law, and may authorize the seal of the corporation to be affixed to all papers which may require it.
7. WRITTEN ACTION. Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing or electronic transmission, and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board or committee. Such filing shall be in paper form if the minutes are maintained in paper form a nd shall be in electronic form if the minutes are maintained in electronic form.
The officers of the corporation shall consist of a President, a Secretary, a Treasurer, and, if deemed necessary, expedient, or desirable by the Board of Directors, a Chairperson of the Board, a Vice-Chairperson of the Board, an Executive Vice-President, one or more other VicePresidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers with such titles as the resolution of the Board of Directors choosing them shall designate. Except as may otherwise be provided in the resolution of the Board of Directors choosing such officer, no officer other than the Chairperson or Vice-Chairperson of the Board, if any, need be a director. Any number of offices may be held by the same person, as the directors may determine.
Unless otherwise provided in the resolution choosing such officer, each officer shall be chosen for a term which shall continue until the meeting of the Board of Directors following the next annual meeting of stockholders and until such officer's successor shall have been chosen and qualified.
All officers of the corporation shall have such authority and perform such duties in the management and operation of the corporation as shall be prescribed in the resolutions of the Board of Directors designating and choosing such officers and prescribing their authority and duties, and shall have such additional authority and duties as are incident to their office except to the extent that such resolutions may be inconsistent therewith. The Secretary or an Assistant Secretary of the corporation shall record all of the proceedings of all meetings and actions in writing of stockholders, directors, and committees of directors, and shall exercise such additional authority and perform such additional duties as the Board shall assign to such Secretary or Assistant Secretary. Any officer may be removed, with or without cause, by the Board of Directors. Any vacancy in any office may be filled by the Board of Directors.
The corporate seal shall be in such form as the Board of Directors shall prescribe.
The fiscal year of the corporation shall be fixed, and shall be subject to change, by the Board of Directors.
ARTICLE VI
Subject to the provisions of the certificate of incorporation and the provisions of the General Corporation Law, the power to amend, alter, or repeal these Bylaws and to adopt new Bylaws may be exercised by the Board of Directors or by the stockholders.
I HEREBY CERTIFY that the foregoing is a full, true, and correct copy of the Bylaws of GoEnergy, Inc., a Delaware corporation, as in effect on the date hereof.
Dated: May 3, 2001
/s/
---------------------------
Secretary of GoEnergy, Inc.
|
(SEAL)
Incorporated under the laws of the State of Delaware
COMMON
GOENERGY, INC.
Total authorized issue 100,000,000 shares
80,000,000 Common Shares 20,000,000 Common Shares With a Par Value of $0.0001 Per Share With a Par Value of $0.0001 Per Share Common Stock Preferred Stock
The Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.
THIS CERTIFIES THAT
is the owner of fully paid and non-assessable Shares of the Capital Stock of the above named Corporation transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this Certificate properly endorsed.
July 23, 2002
Goenergy Inc.
4526 Underwood Street
North Vancouver, British Columbia, Canada
Attention: Strato Malamas, President
Re: Goenergy Inc.'s Registration Statement on Form SB-2
Ladies and Gentlemen:
I have acted as independent counsel for Goenergy Inc., a Delaware corporation (the "Company"), in connection with the Company's registration statement on SB-2 (the "Registration Statement") to be filed with the Securities and Exchange Commission (the "Commission") pursuant to the Securities Act of 1933, as amended (the "Act"), relating to the offering of certain shares of the Company's common stock.
In rendering the opinion set forth below, I have reviewed: (a) the Registration Statement and the exhibits attached thereto; (b) the Company's Articles of Incorporation; (c) the Company's Bylaws; (d) certain records of the Company's corporate proceedings as reflected in its minute books; and (e) such statutes, records and other documents as I have deemed relevant. In my examination, I have assumed the genuineness of all signatures, the authenticity of all documents submitted to myself as originals, and conformity with the originals of all documents submitted to myself as copies thereof. In addition, I have made such other examinations of law and fact as I have deemed relevant in order to form a basis for the opinion hereinafter expressed.
Based upon the foregoing, I am of the opinion that the common stock to be sold by the selling shareholders is validly issued, fully paid and nonassessable. This opinion is based on Delaware general corporate law.
Very truly yours,
/s/ "Arthur J. Frost" -------------------------- Arthur J. Frost, attorney |
Goenergy Inc.
July 23, 2002
We hereby consent to the use of this opinion as an Exhibit to the Registration Statement and to all references to myself under the caption "Interests of Named Experts and Counsel" in the Registration Statement.
Very truly yours,
/s/ "Arthur J. Frost" ------------------------------ Arthur J. Frost, attorney |
Mesa Wood No. 1
STATE OF TEXAS
KNOW ALL MEN BY THESE PRESENTS
COUNTY OF HOOD
THAT, subject to the terms, reservations and conditions hereinafter set forth, International Oil & Gas inc. whose address is 16633 North Dallas Parkway, Suite 600 Addison, Texas 75001 (hereinafter referred to as 'Assignor"), for and in consideration of the sum of Seven Thousand and 500 Dollars ($7,500.00) and other good and valuable consideration., the receipt and sufficiency of which are hereby acknowledged, does hereby GRANT, BARGAIN, SELL, CONVEY and ASSIGN unto GoEnergy, Inc., whose address is Suite 2300, 1066 West Hasting Street, Vancouver, B.C. (hereinafter referred to as "Assignee"), an undivided 1% working interest, and corresponding 0.78% net revenue interest, in the oil and gas lease described in Exhibit 'A" attached hereto and incorporated herein for all purposes (hereinafter referred to as the "Lease"). INSOFAR AND ONLY INSOFAR as the Lease covers and affects the lands described in Exhibit "A" hereto (hereinafter referred to as the "Land").
This Assignment of Oil and Gas Lease is made subject to all of the terms, covenants, conditions and provisions of any instruments of record, including the Lease assigned hereunder, any assignment and subleases by which Assignor, or its predecessors to title, acquired the Lease and the Land, any assignments of overriding royalty or other burdens on production made by Assignor or its predecessors in title (all of which are reflected in the interest granted above), and all operating agreements, letter agreements, gas purchase contracts or other contracts relating to the Lease and the land heretofore entered into by Assignor or its predecessors in title, covering and affecting said Lease and/or Land, and Assignee shall comply with same and be bound by same to the extent of the interest assigned herein. This Assignment is made without warranty of title, either express or implied.
Assignee hereby agrees to comply with all Texas Railroad Commission rules and regulations relating to plugging, abandonment, removal, disposal and restoration obligations, and assume Assignees working interest share of all such costs.
This Assignment of Oil and Gas Lease shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors and assigns.
ASSIGNOR:
INTERNATIONAL OIL & GAS, INC.
ASSIGNEE:
GOENERGY, INC.
EXHIBIT "A"
TO
ASSIGNMENT OF OIL AND GAS LEASE
DATED MARCH ----- 2002
FROM INTERNATIONAL OIL & GAS, INC., AS ASSIGNOR
TO GOENERGY, INC., AS ASSIGNEE
Oil Gas and Mineral Lease dated February 26, 2000 from Ronnie Wood, et al,
as Lessor, to Jerry L. Niuman, Trustee as Lessee, covering 437.4 acres,
more or less, out of the T. A. Wood Survey, A-611; John Howard Survey, A-22 8;
W. Hunter Survey, A-226; and J. W. Peacock Survey, A-698., Hood County, Texas,
recorded in Volume 1700, Page 868, Official Public Records, flood County,
Texas, INSOFAR AND ONLY INSOFAR as the Lease covers forty (40) acres in the
form of a square with the Wood Reef No. 2 Well a/k/a Mesa Wood No.1 Well
(API #42-221-30971) centered therein and the north line of said forty (40)
acre square shall be parallel with the north line of the T. A. Wood Survey,
A-6 11, Hood County, Texas.
INTERNATIONAL OIL & GAS, INC.
June 5, 2002
GoEnergy, Inc.
Suite 2300,
1066 West Hastings St.
Vancouver, B.C.
V6E 3X2
BY FAX: 604.681.1118
Re: Farmout Agreement
Hood County, Texas
Demand Promissory Note Dated March 31, 2002 Gentlemen:
Per the terms of our agreement dated March 10, 2002 and the Demand Promissory Note dated March 31, 2002. Please be advised that GoEnergy, Inc. (the "Borrower") is required under the terms of the Note to make payment of $2500.00 in lawful US money on or before May 30, 2002.
International Oil & Gas, Inc. (the "Lender) hereby notifies GoEnergy of it's right to assign its rights, title and interest to the $2500.00 US due and payable in favor of KJM Capital Corp.
The Lender hereby reserves all of the other rights, title and interest in and to the Promissory note specific to the other terms of payment as it relates to the Farmout agreement and any amendments thereto.
Yours truly,
INTERNATIONAL OIL & GAS, INC.
James Michael Stewart
President, CEO
INTERNATIONAL OIL & GAS, INC.
February 13, 2003
GoEnergy, Inc.
Suite 2300,
1066 West Hastings St.
Vancouver, B.C.
V6E 3X2
BY FAX: 604.681.1118
Re: Farmout Agreement
Hood County, Texas
Demand Promissory Note Dated March 31, 2002
Gentlemen:
Per the terms of our agreement dated March 10, 2002 and the Demand Promissory Note dated March 31, 2002. Please be advised that GoEnergy, Inc. (the "Borrower") is required under the terms of the Note to make payment of $5000.00 in lawful US money on or before October 31, 2002.
International Oil & Gas, Inc. (the "Lender) hereby notifies GoEnergy in
consideration of the payment due of $5000.00 in lawful US money and an
additional payment of $2500.00 in lawful US money to amend and extend
Section 2 ("Well") of the agreement from "On or before October 31, 2002"
to 'On or before February 15, 2004."
The Lender hereby reserves all of the other rights, title and interest in and to the Promissory note specific to the other terms of payment as it relates to the Farmout agreement and any amendments thereto.
Yours truly,
INTERNATIONAL OIL & GAS, INC.
James Michael Stewart
President, CEO
INTERNATIONAL OIL & GAS, INC.
16633 North Dallas Parkway, Suite 600
Addison, Texas 75001
March 10, 2002
GoEnergy, Inc.
Suite 2300,
1066 West Hastings St.
Vancouver, B.C. V6E 3X2
Re: Farmout Agreement Hood County, Texas
Gentlemen:
This Farmout Agreement (the "Agreement") is dated effective March 10, 2002, by and between International Oil & Gas, Inc. ("Farmor") and GoEnergy, Inc. ("Farmee"), whereby Farmee may acquire certain rights and benefits in the drill-site and pro-rata leasehold subject hereto upon the consideration to Farmor of $10,000.00 USD by Farmee and Farmee's compliance with the terms and conditions hereof.
1. Farmout Acreage and Interests. Farmor is the record title owner to that certain oil and gas leasehold interest covering certain lands in Hood County, Texas, said leasehold interest being more particularly described in Exhibit "A" attached hereto and made a part hereof for all purposes (the "Lease").
2. Well. On or before October 31, 2002, Farmee shall commence, or cause to be commenced, the actual drilling of the Well ("Well") on the drill-site location ("Location") from the legal location on the lands covered by the Lease, and described in Exhibit "B" and shall thereafter continuously prosecute such drilling operations in a diligent and workmanlike manner until the Well reaches a depth of 6000 feet beneath the surface of the earth or a depth sufficient to test the Barnet Shale formation, whichever is lesser.
Unless any unforeseen difficulties are encountered, the Well, as hereinafter defined, drilled hereunder shall each be completed as a well capable of producing oil and/or gas or plugged and abandoned as a dry hole within one hundred twenty (120) days after the date actual drilling operations thereon are commenced.
3. Substitute Well. If, during the drilling of the well provided for herein, Farmee encounters a formation or other physical condition in the well which renders further drilling impractical, Farmee may promptly plug and abandon the well. Thereafter, Farmee shall, within sixty (60) days from the abandonment, have the option, but not the obligation, to commence the actual drilling of a substitute well at a legal location on the Lease within one hundred feet (100') from the location of the well for which it is substituted.
GoEnergy, Inc. - Page 2
March 10, 2002
Any substitute well shall be commenced, drilled and otherwise prosecuted in accordance with all the provisions hereof and shall be treated as if it were the well for which it is substituted.
4. Well Assignment: In the event Farmee is successful in establishing oil and/or gas production in paying quantities from the respective Well or Subsequent Well, and otherwise complies with all of the provisions of this Agreement and Farmee has otherwise complied with all of the provisions of this Agreement, Farmor shall assign to Farmee, subject to the reservations and exceptions set forth herein, Farmor's right, title and interest in and to the Lease, from the surface to one hundred feet (100') below the deepest depth drilled in the applicable Test Well but INSOFAR AND ONLY INSOFAR as the Lease covers and effects production of oil and gas from the applicable Test Well which is producing oil and/or gas in paying quantities. Any Wellbore Assignment made pursuant to this Agreement shall be in a mutually acceptable form, contain no warranty of title, and shall be made expressly subject to the terms of this Agreement. Subject to Farmor's reserved Carried Working Interest as set forth in Section 5.c. herein below, Farmee shall be delivered a seventy-eight percent of eight-eighths (78% of 8/8) net revenue interest in the wellbore and the production therefrom out of the Lease.
5. Reservations and Exceptions. Subject to the terms of this Agreement, any Assignment earned by Farmee hereunder shall reserve and except to Farmor the following:
a. Mutual rights of ingress and egress over the lands covered by the Lease;
b. All rights to the lands covered by the Lease in accordance with Section
8. herein below and all depths thereunder except for depths in each
wellbore from the surface to one hundred feet (100') below the deepest
depth drilled in the respective Well or Subsequent Well drilled by Farmee
hereunder;
c. Upon completion of the Well or Substitute Well as a Well producing oil
and/or gas in paying quantities, Farmor shall retain in such well the
following carried working interest through production in paying
quantities (being through first sales if a gas well and through
production into the tanks if a oil well), it being agreed and understood
that Farmee shall bear and pay for one hundred percent (100%) of the
cost of drilling, testing, completing and equipping the well under this
Agreement, to-wit:
Farmor's Reserved Carried Interest
Leasehold Net Revenue
Well Working Interest Interest
---- ---------------- --------
GoEnergy No. 1 25.00% 19.500%
|
GoEnergy Inc. - Page 3 March 10, 2002 |
In the event the Lease does not cover a full mineral interest or Farmor does not own all leasehold rights therein, then the carried working interest reserved to Farmor herein shall be proportionately reduced.
6. Wellbore Assignments. It is agreed and understood that Farmee is granted the right to earn an interest in the Lease INSOFAR AND ONLY INSOFAR as the Lease covers depths from the surface to one hundred feet (100') below the deepest depth drilled in each earning wellbore, and further, INSOFAR AND ONLY INSOFAR as the Lease covers and effects production of oil and gas from the applicable earning wellbore in accordance with this Agreement. For greater certainty, it is expressly stated that in the event Farmee is due an assignment from Farmor upon the successful drilling and completion of a well as a producer of oil and/or gas in paying quantities as provided in this Agreement, Farmee is being assigned an interest in the Lease only to the extent that the assignment of the Lease is legally required to facilitate ownership of the production of oil and gas from the applicable wellbore only. It is additionally provided that in the event any Railroad Commission of Texas forms require the Farmee to designate acreage for density, spacing, pro-ration or other purposes, Farmor and Farmee shall mutually agree upon the designation of such acreage which shall then be credited to Farmee for the limited purposes of Railroad Commission of Texas filings, but Farmee shall have no other rights in the Lease irrespective of the designation of same on the Railroad Commission of Texas filings by Farmee. Finally, Farmor and Farmee agree that any designation of acreage out of the Lease for the limited purposes of Railroad Commission of Texas filings shall never exceed forty (40) acres. Irrespective of any Wellbore Assignments made by Farmor to Farmee in accordance with the terms of this Agreement, Farmee shall have the right to independently develop all lands covered by the Lease, SAVE AND EXCEPT for the wellbore, and the oil and gas production therefrom, which are earned by Farmee in accordance with the terms of this Agreement. Notwithstanding any terms contained in this Agreement to the contrary, in the event of a conflict between the terms contained in this Section 6. and any other terms of the Agreement, the terms of this Section 6. shall prevail and control.
7. Pooling. Farmee may pool or unitize all or any part of the lands covered by the Lease with other lands or leases without the prior written consent of Farmor.
8. Operations. Farmee shall conduct all operations hereunder at Farmee's sole risk, cost and expense. All such operations shall be prosecuted with due diligence, in a good and workmanlike manner and without any unreasonable delay. When any well drilled hereunder reaches its projected total depth and has been adequately tested, Farmee shall either complete same as a producer or plug and abandon same in accordance with all applicable laws and regulations.
9. Assumption of Lease Obligations. Farmee shall commence and conduct all operations contemplated by this Agreement in accordance with the provisions of the Lease. If any well drilled hereunder is plugged and abandoned, Farmee shall
GoEnergy Inc. - Page 4
March 10, 2002
restore the surface of the land to substantially the same condition as before the commencement of operations thereon and to the satisfaction of the surface owner and/or tenant.
10. Failure to Drill. Farmee shall not be liable in damages to Farmor for failure to commence, drill, test, complete or equip Well (or any substitute well) as herein provided, but any such failure shall result in the loss to Farmee of all rights under this Agreement. The foregoing shall not be construed to restrict, preclude or limit any rights Farmor may have, in law or in equity, by virtue of Farmee's negligence or willful misconduct, or for any breach by Farmee of any other obligation under this Agreement, including, without limitation, the obligation to provide information to Farmor and to indemnify Farmor as hereinafter provided.
11. Indemnity. Farmee shall, to the fullest extent permitted by applicable
law, protect, indemnify and hold Farmor harmless, free and clear of and from
all liens, claims, actions, liabilities, expenses and causes of action of every
kind, together with court costs and attorneys' fees, arising out of or in
connection with operations and activities conducted or caused by Farmee under
or pursuant to this Agreement, including all costs, expenses and obligations
of plugging and abandoning any well drilled hereunder; provided, however,
should Farmee become vested with a carried working interest as set forth in
Section 5.c. above, Farmor shall be responsible for its proportionate share
of costs associated with the plugging and abandoning of any such well.
12. Information. Farmor's authorized representatives shall at all times, at their sole risk and expense, have full and free access to the rig floor and to all information concerning any well drilled or reworked hereunder. Farmee shall keep an accurate and detailed log of each well drilled or reworked hereunder. Farmee shall also provide Farmor with a daily drilling report for each well drilled hereunder. Farmee shall also furnish to Farmor at no cost all information and data relating to each well hereunder including, without limitation, well files, logs, cores, samples, tests and production reports. All information relative to any wells drilled hereunder shall be kept confidential by Farmee and shall not be disclosed to any third parties, other than working interest participants therein, without the prior consent of Farmor.
13. Operating Agreement. Prior to the first sales of oil or gas production from the first well to be successfully completed as a producer of oil or gas hereunder, Farmor and Farmee shall enter into a mutually acceptable form of joint operating agreement ("JOA"). In the event of a conflict between the terms of this Agreement and the JOA, the terms of this Agreement shall prevail and control.
14. Notices. All notices or communications provided for herein shall be in writing and delivered to the parties' respective addresses set forth below. The addresses of the parties for notice purposes are as follows:
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March 10, 2002
If to Farmor:
International Oil & Gas, Inc.
16633 North Dallas Parkway, Suite 600
Addison, Texas 75001
Attn: Mr. James Michael Stewart
Telephone: 972.588.3385
Telecopier: 972.588.3385
If to Farmee:
GoEnergy, Inc.
Suite 2300,
1066 West Hastings St.
Vancouver, B.C. V6E 3X2
Attn: Mr. Strato Malamas
Telephone: 604.608.1118
Telecopier: 604.681.1118
15. Title Information. Farmor agrees to furnish to Farmee any and all title information relating to the Lease and now in the possession of Farmor. Any additional title work shall be conducted at Farmee's sole cost and expense, and copies thereof will be promptly furnished to Farmor.
16. Insurance. Farmee shall maintain the insurance described on Exhibit "B" attached hereto and incorporated herein for all purposes which covers the drilling and completion of all wells hereunder and any other operations conducted by Farmee on the Lease. Farmee shall furnish Farmor with a certificate of insurance evidencing same prior to commencing drilling operations hereunder which shall expressly name Farmor as an additionally insured party. Farmee shall make a bona fide effort to pay any shut-in royalty payable on any well drilled by Farmee hereunder. In the absence of gross negligence, neither party shall have any liability to the other party if the shut-in royalties as provided above are not timely paid.
17. Well Abandonment, Takeover and Reassignment. Farmee agrees to notify Farmor no later than thirty (30) days (or forty-eight (48) hours if a drilling rig is on location) prior to plugging and abandoning the Respective Well or Subsequent Well drilled on the Lease and Farmor shall have the option, but not the obligation, to take over such well at its sole risk, cost and expense. If Farmor elects to take over such well, Farmee shall promptly execute an Assignment of such wellbore to Farmor (if Farmee holds record title) and Farmee shall execute and file with the Railroad Commission of Texas Form P-4 transferring operatorship to Farmor. In the event Farmor exercises such
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March 10, 2002
option and completes said well as a producer of oil and/or gas in paying quantities or as a water disposal or supply well, Farmee shall be deemed to have waived any rights hereunder insofar as this Agreement pertains to such well and any production therefrom. If Farmor elects to take over any such well, then upon completion of operations, Farmor shall plug and abandon said well at its sole expense and accept all liability therefor. If Farmor elects not to take over any such well, Farmee shall plug and abandon said well at its sole expense and accept all liability therefore; provided, however, if Farmor has been vested with a carried working interest in accordance with Section 5.c. Farmor shall bear and pay its proportionate share of such plugging costs.
Notwithstanding the foregoing, in the event a well which has been completed as a producer of oil and/or gas in paying quantities should cease to produce, Farmee shall reassign to Farmor, with special warranty of title, the wellbore in which production ceased and the right to future production therefrom out of the Lease, unless Farmee commences drilling or reworking operations thereon within sixty (60) days from the date of cessation of production.
18. Relationship of Parties. This Agreement is not intended and shall not be construed to create a mining partnership, joint venture, or any other type of commercial partnership.
19. Time of Essence. Time is of the essence in this Agreement.
20. Applicable Law. With respect to all operations and other activities under and concerning this Agreement, Farmee shall comply with all valid and applicable laws, regulations, rules and ordinances of all federal, state, local and other governmental entities having jurisdiction. This Agreement shall be construed under and in accordance with the laws of the State of Texas.
21. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto, their successors and assigns. Farmee may not assign this Agreement or any interest in the Lease earned hereunder, in whole or in part, without prior written consent to such assignment by Farmor. Any assignment of this Agreement or of any interest in the Lease, in whole or in part, shall be made expressly subject to this Agreement.
22. Headings. The underlined headings used throughout this Agreement are for administrative convenience only and shall be disregarded for purposes of construing the Agreement.
23. Counterparts. This Agreement may be executed in counterpart and each counterpart shall be deemed an original for all purposes and shall be binding upon each party executing same whether or not executed by all parties.
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March 10, 2002
24. Deadline for Acceptance. If this Agreement is not signed by Farmee and returned to Farmor on or before five (15) days from the date hereof, this Agreement shall be voidable at the sole option of Farmor.
If the foregoing sets forth the terms of our agreement, please execute both copies hereof in the space provided below and return one (1) copy on or before the deadline provided in the above paragraph.
Very truly yours,
INTERNATIONAL OIL & GAS, INC.
AGREED TO AND ACCEPTED THIS
10th DAY OF MARCH 2002
INTERNATIONAL OIL & GAS, INC.
GOENERGY, INC.
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March 10, 2002
EXHIBIT "A"
TO
FARMOUT AGREEMENT DATED MARCH 10, 2002
BY AND BETWEEN
INTERNATIONAL OIL & GAS, INC., AS FARMOR
AND GOENERGY, INC., AS FARMEE
Dated April 21, 1999, recorded Volume 1644 Page 239 Deed Report of Hood County, from Tonya Randall, as Leasor, to JJB Oil & Gas Inc. and E.E. Miller, as Leasee, insofar as the lease covers the 111.89 acres, more or less, out of the William Hunter survey, more particularly describes in said lease, save and except the 40 acre pro-ration unit surrounding the #1 Tonya Randall Well, as said pro-ration unit is more particularly described on the survey plat.
EXHIBIT "B"
TO
FARMOUT AGREEMENT DATED MARCH 10, 2002
BY AND BETWEEN
INTERNATIONAL OIL & GAS, INC., AS FARMOR
AND GOENERGY, INC., AS FARMEE
Farmee ("Operator") and any drilling contractor employed to drill a well hereunder ("Drilling Contractor") shall carry the following insurance for the benefit of the parties, to cover their operations hereunder:
TYPE OF INSURANCE LIMITS
----------------- ------
a. Workmen's Compensation Amount equal to full liability imposed
by laws of all non-monopolistic states
b. Employer's Liability
Bodily Injury $1,000,000 each accident
Occupational Disease $1,000,000 per person
Occupational Disease $1,000,000 policy limit
c. Comprehensive General Liability
Combines Single Limit Bodily
Injury and Property Damage $1,000,000 each occurrence
Products-Completed Operations $1,000,000 aggregate
Underground Resource
and Equipment $1,000,000 aggregate
d. Comprehensive Automobile
Liability $100,000 each person
$500,000 each occurrence
Combined Liability
Bodily Injury and Property
Damage $1,000,000 each occurrence
Excess Liability/
Umbrella Insurance $5,000,000 each occurrence
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All insurance policies carried pursuant to this Agreement shall contain an agreement by the insurance carrier issuing the policy to waive its rights of subrogation with respect to all claims involving injury subject to the Workmen's Compensation Law of any state and all claims involving any general liability.
In consideration of the flat rate charge to be made under the Accounting Procedure by Operator for Operator's fully owned automobile equipment used for Operator's Automobile Public Liability Insurance, no direct charge shall be made by Operator to the joint account for premiums paid for Automobile Public Liability Insurance.
In the event Operator or Drilling Contractor employs contractors to perform any work hereunder, then and in such event, all such contractors shall be required to carry the full compliance with the Workmen's Compensation Law of the State of Texas and all rules and regulations promulgated thereunder.
All insurance carried by Operator (for the joint account) and Drilling contractor hereunder shall include Farmor as an additional insured. Upon request, Operator and Drilling Contractor shall furnish to Farmor a certificate covering each policy of insurance issued pursuant to this Agreement.
Pannell Kerr Forster PKF Worldwide 7th Floor, Marine Building 355 Burrard St., Vancouver, B.C., Canada, V6C 2G8 Telephone: (604)687-1231 Facsimile:(604)688-4675
CONSENT OF INDEPENDENT CHARTERED ACCOUNTANTS
We hereby consent to the use in Form SB-2 of GoEnergy Inc., our report dated October 8, 2002 except for note (8)(iii) which is as at March 3, 2003 relating to the balance sheets as at July 31, 2002 and 2001 and the related statements of operations, changes in stockholders' equity and cash flows for the year ended July 31, 2002 and the period from inception (May 2, 2001) through July 31, 2001 of GoEnergy Inc. which appears in such Form SB-2, and to the reference to our Firm in the filing.
"Pannell Kerr Forster"
Chartered Accountants
Vancouver, Canada
March 3, 2003