UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
VANELL, CORP.
(Exact name of registrant as specified in its charter)
Nevada (State or Other Jurisdiction of Incorporation or Organization) |
7380 Primary Standard Industrial Classification Code Number |
33-1225521
IRS Employer
|
Res. San Antonio Bk 10, Pje 7 N5
San Antonio Del Monte, Sonsonate,
El Salvador SV-106090030
Tel. 011-503-79511698
E-mail: vanellcorp@gmail.com
(Address, telephone number and e-mail address of principal executive offices)
Incorp Services, Inc.
2360 Corporate Circle, Ste. 400
Henderson, Nevada 89074-7722
Tel. (702) 866-2500
Fax. (702) 866-2689
(Name, address and telephone number of agent for service)
Copies To:
Stepp Law Corporation
15707 Rockfield Boulevard, Suite 101
Irvine, California 92618
tes@stepplawgroup.com
Phone: (949) 660-9700
Fax: (949) 660-9010
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Approximate date of proposed sale to the public: |
as soon as practicable after the effective date of this Registration Statement. |
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box |X|
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |__|
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |__|
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |__|
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer, and smaller reporting company: in Rule 12b-2 of the Exchange Act (Check one):
Large accelerated filer |__| Accelerated filer |__|
Non-accelerated filer |__| Smaller reporting company | X |
(Do not check if a smaller reporting company)
CALCULATION OF REGISTRATION FEE
(1) |
Determined arbitrarily by adding a $0.03 premium to the last sale price of our common stock to investors. |
(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 January 30, 2013
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PROSPECTUS
Vanell, Corp.
880,000
SHARES
COMMON STOCK
The selling shareholders named in this prospectus are offering all of the shares of common stock offered through this prospectus for a period of up to two years from the effective date.
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 7-13.
The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted .
The selling shareholders will sell our shares at $0.06 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 by adding a $0.03 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering until and unless the security is subsequently listed on an exchange or is listed by a market maker on the OTC BB. Currently the company is not so listed and there is no assurance that the stock will ever be so listed.
There has been no market for our securities. Our common stock is not traded on any exchange or on the Over-the-Counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with FINRA for our common stock to become eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There is no assurance that a trading market will develop or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so.
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. Any representation to the contrary is a criminal offense.
We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act) and, as such, may elect to comply with certain reduced public company reporting requirements for future filings. Investing in our common stock involves risk. See Risk Factors beginning on page 7 of this prospectus.
The Date of This Prospectus Is: January 30, 2013
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Summary
Prospective investors are urged to read this prospectus in its entirety.
Vanell, Corp. was found in the State of Nevada on September 7, 2012. We are an El Salvador based corporation and provide consulting services in commercial cultivation and processing of coffee in El Salvador. To date, our business operations have been limited to primarily, the development of a business plan, the completion of private placements for the offer and sale of our common stock, discussing the offers of our consulting services with potential customers, signing of the consulting service agreement with Finca La Esmeralda, a private El-Salvadorian company and realization of first revenue of $2,400 pursuant to the signed agreement with Finca La Esmeralda.
We are a development stage company and cannot state with certainty whether we will achieve significant profitability. As of January 30, 2013 we have minimal revenues and assets. We plan to expand our services to Central American and North American markets in the future if we have the available resources and growth to warrant it.
We must raise additional capital in order for our business plan to succeed. We are not raising any money in this offering. The most likely source of future funds available to us is through the sale of additional shares of common stock, revenues realized from the signed consulting agreement with Finca La Esmeralda or advances from our sole director. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
Our auditors have issued a going concern opinion. This means that that there is substantial doubt that we can continue as an ongoing business for the next twelve months.
On November 26, 2012 the service agreement was signed with Finca La Esmeralda, an El Salvador based company.
Even though the negotiation of additional agreements with customers will be ongoing during the life of our operations, we cannot guarantee that we will be able to find successful agreements, in which case our business may fail and we will have to cease our operations.
We were incorporated on September 7, 2012 under the laws of the state of Nevada. Our principal office is located at Res. San Antonio Bk 10, Pje 7 N5 San Antonio Del Monte, Sonsonate, El Salvador SV-106090030. Our telephone number is 011-503-79511698. Our fiscal year end is December 31.
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The Offering :
Securities Being Offered |
Up to 880,000 shares of common stock. |
Offering Price |
The selling shareholders will sell our shares at $0.06 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 by adding a $0.03 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering until and unless the security is subsequently listed on an exchange or is listed by a market maker on the OTC BB. Currently the company is not so listed and there is no assurance that the stock will ever be so listed. |
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 880,000 shares of common stock have been sold, the shares no longer need to be registered to be sold due to the operation of Rule 144 or we decide at any time to terminate the registration of the shares at our sole discretion. In any event, the offering shall be terminated no later than two years from the effective date of this registration statement. |
Securities Issued and to be Issued |
880,000 shares of our common stock to be sold in this prospectus are issued and outstanding as of the date of this prospectus. All of the common stock to be sold under this prospectus will be sold by existing shareholders. |
Use of Proceeds |
We will not receive any proceeds from the sale of the common stock by the selling shareholders. |
Market for the common stock |
There has been no market for our securities. Our common stock is not traded on any exchange or on the Over-the-Counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with FINRA for our common stock to become eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There is no assurance that a trading market will develop or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so. |
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Summary Financial Information
The following financial information summarizes the more complete historical financial information at the end of this prospectus.
Risk Factors related to our Business and Industry
Please consider the following risk factors before deciding to invest in our common stock. Any investment in our common stock is speculative. You should carefully consider the risks described below and all of the information contained in this Prospectus before deciding whether to purchase our common stock. If any of the following risks actually occur, our business, financial condition and results of operations could be harmed. If any of these risks materialize, the trading price of our common stock could decline and you may lose all or part of your investment.
WE LACK AN OPERATING HISTORY AND THERE IS NO ASSURANCE OUR FUTURE OPERATIONS WILL RESULT IN SIGNIFICANT REVENUES OR PROFITABILITY. IF WE CANNOT GENERATE SUFFICIENT REVENUES TO OPERATE PROFITABLY, WE MAY SUSPEND OR CEASE OPERATIONS.
We were incorporated on September 7, 2012, and our net income since inception is $951. We have little operating history upon which an evaluation of our future success or failure can be made. Based upon current plans, we expect to incur operating losses in the foreseeable future because we will be incurring large expenses and generating small revenues. Failure to generate significant revenues in the future will cause us to go out of business.
IF WE DO NOT OBTAIN ADDITIONAL FINANCING, OUR BUSINESS MAY FAIL.
While on December 31, 2012, we had cash on hand of $23,663, our current cash reserves are not sufficient to meet our obligations for the next twelve-month period. We anticipate that the minimum additional capital necessary to fund our planned operations for the 12-month period will be approximately $7,000 and will be needed for general administrative expenses, business development, marketing costs, support materials and costs associated with being a publicly reporting company. We have generated revenues of $2,400 from operations to date. In order to expand our business operations, we anticipate that we will have to raise additional funding. If we are not able to raise the capital necessary to fund our business expansion objectives, we may have to delay the implementation of our business plan.
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We do not currently have any arrangements for financing. Obtaining additional funding will be subject to a number of factors, including general market conditions, investor acceptance of our business plan and initial results from our business operations. These factors may impact the timing, amount, terms or conditions of additional financing available to us.
We are not raising any money in this offering. The most likely source of future funds available to us is through the sale of additional shares of common stock, revenues realized pursuant to the agreement signed with Finca La Esmeralda or advances from our sole director.
There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
LACK OF SIGNIFICANT REVENUES TO DATE MAY CAUSE A SUBSTANTIAL DOUBT AS TO WHETHER WE WILL CONTINUE OPERATIONS. IF WE DISCONTINUE OPERATIONS, YOU COULD LOSE YOUR INVESTMENT.
Vanell, Corp. was incorporated on September 7, 2012. We are a development stage company. Even though we have earned revenues of $2,400 as of the date of this prospectus and have earned net income since inception of $951, you cannot evaluate our business, and therefore our future prospects, due to a lack of operating history and small revenues. To date, our business operations have been limited to primarily, the development of a business plan, the completion of private placements for the offer and sale of our common stock, discussing the offer of consulting services with potential customers, and the signing of the consulting service agreement with Finca La Esmeralda, a private El Salvador company. Potential investors should be aware of the difficulties normally encountered by development stage companies and the high rate of failure of such enterprises. In addition, there is no guarantee that we will be able to expand our business operations. Even if we expand our operations, at present, we do not know precisely when this will occur.
We cannot guarantee that we will be successful in generating revenues and profit in the future. Failure to generate revenues and profit will cause us to suspend or cease operations. If this happens, you could lose all or part of your investment.
WE FACE STRONG COMPETITION FROM LARGER AND WELL ESTABLISHED COMPANIES, WHICH COULD HARM OUR BUSINESS AND ABILITY TO OPERATE PROFITABLY.
Our industry is competitive. There are many different companies that provide consulting services in commercial cultivation and processing of coffee in El Salvador and our services are not unique to their services. Even though the industry is highly fragmented, it has a number of large and well established companies, which are profitable and have developed a brand name. Aggressive marketing tactics implemented by our competitors could impact our limited financial resources and adversely affect our ability to compete in our market.
COMPETITION FOR POTENTIAL CUSTOMER ACCOUNTS IS INTENSE. FAILURE TO COMPETE WILL AFFECT OUR FINANCIAL CONDITION.
Winning customers will be critical to our ability to grow our business. Competition for potential customer accounts is intense. Failing to obtain orders for our services from potential customers, for competitive reasons or otherwise, would materially adversely affect our operating results and financial condition.
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THE CONSULTING SERVICES IN COMMERCIAL CULTIVATION AND PROCESSING OF COFFEE MIGHT BE AFFECTED BY GENERAL ECONOMIC DECLINE AND THIS COULD ADVERSELY AFFECT OUR OPERATING RESULTS AND COULD LEAD TO LOWER REVENUES THAN EXPECTED.
The consulting services in commercial cultivation and processing of coffee might be affected by general economic decline. We expect that this could adversely affect our operating results and could lead to lower revenues than expected if economic situation does not change for better.
PRICE COMPETITION COULD NEGATIVELY AFFECT OUR GROSS MARGINS.
Price competition could negatively affect our operating results. To respond to competitive pricing pressures, we will have to offer our services at lower prices in order to retain or gain market share and customers. If our competitors offer discounts on certain services in the future, we will need to lower prices to match the competition, which could adversely affect our gross margins and operating results.
BECAUSE MR. MAGANA, OUR SOLE OFFICER AND DIRECTOR, IS NOT A RESIDENT OF THE UNITED STATES IT MAY BE DIFFICULT TO ENFORCE ANY LIABILITIES AGAINST HIM.
Accordingly, if an event occurs that gives rise to any liability, shareholders would likely have difficulty in enforcing such liabilities because Mr. Francisco Douglas Magana, our sole officer and director resides outside the United States. If a shareholder desired to sue, the shareholder would have to serve a summons and complaint. Even if personal service is accomplished and a judgment is entered against a person, the shareholder would then have to locate assets of that person, and register the judgment in the foreign jurisdiction where assets are located.
BECAUSE COMPANYS HEADQUARTERS ARE LOCATED OUTSIDE THE UNITED STATES, U.S. INVESTORS MAY EXPERIENCE DIFFICULTIES IN ATTEMPTING TO AFFECT SERVICE OF PROCESS AND TO ENFORCE JUDGMENT BASED UPON U.S. FEDERAL SECURITIES LAWS AGAINST THE COMPANY AND ITS NON U.S. RESIDENT OFFICER AND DIRECTOR.
While we are organized under the laws of State of Nevada, our officer and director is a non-U.S. resident and our headquarters are located outside the United States. Consequently, it may be difficult for investors to affect service of process in the United States and to enforce in the United States judgments obtained in United States courts based on the civil liability provisions of the United States securities laws. Since all our assets will be located in El Salvador it may be difficult or impossible for U.S. investors to collect a judgment against us. As well, any judgment obtained in the United States against us may not be enforceable in the United States.
WE MAY BE EXPOSED TO POTENTIAL RISKS RESULTING FROM NEW REQUIREMENTS UNDER SECTION 404 OF THE SARBANES-OXLEY ACT OF 2002.
Upon the effectiveness of our registration statement, we will be newly public company. We will not need to comply with Section 404 of the Sarbanes-Oxley Act until we file our second annual report with the SEC. However, we will need to include a statement in our first annual report and we must indicate that the annual report does not include either a managements report on internal control or auditor attestation of internal control.
We have not yet completed our assessment of the effectiveness of our internal control over financial reporting, and we expect to incur additional expenses and diversion of managements time as a result of performing the system and process evaluation, testing and remediation required in order for us and our auditors to comply with the auditor attestation requirements.
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AS AN EMERGING GROWTH COMPANY UNDER THE JOBS ACT, WE ARE PERMITTED TO RELY ON EXEMPTIONS FROM CERTAIN DISCLOSURE REQUIREMENTS.
We qualify as an emerging growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure requirements. For so long as we are an emerging growth company, we will not be required to:
- have an auditor report on our internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
- comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditors report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
- submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay and say-on-frequency; and
- disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the Chief Executives compensation to median employee compensation.
In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards.
We will remain an emerging growth company for up to five years, or until the earliest of (i) the last day of the first fiscal year in which our total annual gross revenues exceed $1 billion, (ii) the date that we become a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, which would occur if the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter or (iii) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three year period.
Until such time, however, we cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.
BECAUSE OUR SOLE OFFICER AND DIRECTOR 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.
Our sole officer and director, Mr. Francisco D. Magana, will only be devoting limited time to our operations. Mr. Magana intends to devote approximately 25 hours a week of his business time to our affairs. Because our sole officer and director will only be devoting limited time to our operations, our operations may be sporadic and occur at times which are convenient to him. As a result, our operations may be periodically interrupted or suspended which could result in a lack of revenues and a possible cessation of operations. It is possible that the demands on Mr. Magana from his other obligations could increase with the result that he would no longer be able to devote sufficient time to the management of our business. In addition, Mr. Magana may not possess sufficient time for our business if the demands of managing our business increase substantially beyond current levels.
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BECAUSE OUR SOLE DIRECTOR HAS AN INTEREST IN A COMPANY INVOLVED IN THE SAME INDUSTRY, THERE IS A POTENTIAL CONFLICT OF INTEREST, INCLUDING THE AMOUNT OF TIME HE IS ABLE TO DEDICATE TO VANELL, CORP. AND ITS BUSINESS.
Our sole director Mr. Magana is associated with another company that is engaged in business activities similar to those conducted by us. Mr. Magana is owner of the agricultural company FDMag S.A. de C.V. while also providing consulting services to commercial coffee growers in El Salvador. FDMag S.A. de C.V. is not an affiliate of Vanell, Corp. Potential conflict of interest may arise in future that may cause our business to fail, including conflict of interest in allocating Mr. Maganas time to our company as well as additional conflict of interests over determining to which entity a particular business opportunity should be presented. We do not currently have a right of first refusal pertaining to business opportunities that come to management's attention. While our sole officer and director has verbally agreed to present business opportunities first to us, subject to any pre-existing duty he may have, we have not adopted a policy that expressly prohibits our sole officer and director Mr. Magana from having a direct or indirect financial interest in potential future opportunity or from engaging in business activities of the types conducted by us. As a result, in determining to which entity particular business opportunities should be presented, our sole officer and director Mr. Magana may favor him own interests and the interests of FDMag S.A. de C.V. over our interests and those of our shareholders, which could have a material adverse effect on our business and results of operations.
IF MR. MAGANA, OUR SOLE OFFICER AND DIRECTOR, SHOULD RESIGN OR DIE, WE WILL NOT HAVE AN OFFICER OR A DIRECTOR. THIS COULD RESULT IN OUR OPERATIONS SUSPENDING, AND YOU COULD LOSE YOUR INVESTMENT.
We extremely depend on the services of our sole officer and director, Mr. Magana, for the future success of our business. The loss of the services of Mr. Magana could have an adverse effect on our business, financial condition and results of operations. If he should resign or die we will not have a chief executive officer. If that should occur, until we find another person to act as our chief executive officer, our operations could be suspended. In that event it is possible you could lose your entire investment.
BECAUSE OUR SOLE OFFICER AND DIRECTOR OWNS 77.32% OF OUR ISSUED AND OUTSTANDING COMMON STOCK, HE COULD MAKE AND CONTROL CORPORATE DECISIONS THAT MAY BE DISADVANTAGEOUS TO MINORITY SHAREHOLDERS.
Our sole officer and director, Francisco Magana, owns approximately 77.32% 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. He will also have the power to prevent or cause a change in control. The interests of our sole officer and director may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders.
BECAUSE OUR AUDITORS HAVE RAISED A GOING CONCERN, THERE IS A SUBSTANTIAL UNCERTAINTY THAT WE WILL CONTINUE OPERATIONS IN WHICH CASE YOU COULD LOSE YOUR INVESTMENT.
Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next twelve months. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue in business. As such we may have to cease operations and you could lose your investment.
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WE DO NOT EXPECT TO PAY DIVIDENDS IN THE FORESEEABLE FUTURE.
We have never paid any dividends on our common stock. We do not expect to pay cash dividends on our common stock at any time in the foreseeable future. The future payment of dividends directly depends upon our future earnings, capital requirements, financial requirements and other factors that our board of directors will consider. Since we do not anticipate paying cash dividends on our common stock, a return on your investment, if any, will depend solely on an increase, if any, in the market value of our common stock.
ANY ADDITIONAL FUNDING WE ARRANGE THROUGH THE SALE OF OUR COMMON STOCK WILL RESULT IN DILUTION TO EXISTING SHAREHOLDERS.
We must raise additional capital in order for our business plan to succeed. We are not raising any money in this offering. Our most likely source of additional capital will be through the sale of additional shares of common stock. Such stock issuances will cause stockholders' interests in our company to be diluted. Such dilution will negatively affect the value of investors shares.
OUR SHARES OF COMMON STOCK ARE SUBJECT TO THE PENNY STOCK RULES OF THE SECURITIES AND EXCHANGE COMMISSION AND THE TRADING MARKET IN OUR SECURITIES WILL BE LIMITED, WHICH WILL MAKE TRANSACTIONS IN OUR STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR STOCK.
The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in "penny stocks. Penny stocks generally are 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). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating 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 agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules. If a trading market for our common stock develops, our common stock will probably become subject to the penny stock rules, and shareholders may have difficulty in selling their shares.
IF OUR SHARES OF COMMON STOCK COMMENCE TRADING ON THE OTC BULLETIN BOARD, THE TRADING PRICE MAY FLUCTUATE SIGNIFICANTLY AND STOCKHOLDERS MAY HAVE DIFFICULTY RESELLING THEIR SHARES.
As of the date of this Registration Statement, our common stock does not yet trade on the Over-the-Counter Bulletin Board. If our shares of common stock commence trading on the Bulletin Board, there is a volatility associated with Bulletin Board securities in general and the value of your investment could decline due to the impact of any of the following factors upon the market price of our common stock: (i) disappointing results from our development efforts; (ii) failure to meet our revenue or profit goals or operating budget; (iii) decline in demand for our common stock; (iv) downward revisions in securities analysts' estimates or changes in general market conditions; (v) technological innovations by competitors or in competing technologies; (vi) lack of funding generated for operations; (vii) investor perception of our industry or our prospects; and (viii) general economic trends.
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We do not have a market maker. There is no current trading market for our securities and if a trading market does not develop, purchasers of our securities may have difficulty selling their shares. In addition, stock markets have experienced price and volume fluctuations and the market prices of securities have been highly volatile. These fluctuations are often unrelated to operating performance and may adversely affect the market price of our common stock. As a result, investors may be unable to sell their shares at a fair price and you may lose all or part of your investment.
FOLLOWING THE EFFECTIVE DATE OF OUR REGISTRATION STATEMENT, OF WHICH THIS PROSPECTUS IS A PART, WE WILL BE SUBJECT TO THE PERIODIC REPORTING REQUIREMENTS OF SECTION 15(D) OF THE EXCHANGE ACT THAT WILL REQUIRE US TO INCURE AUDIT FEES AND LEGAL FEES IN CONNECTION WITH THE PREPARATION OF SUCH REPORTS. THESE ADDITIONAL COSTS COULD REDUCE OR ELIMINATE OUR ABILITY TO EARN A PROFIT.
Following the effective date of our registration statement of which this prospectus is a part, we will be required to file periodic reports with the SEC pursuant to the Exchange Act and the rules and regulations promulgated thereunder. In order to comply with these requirements, our independent registered public accounting firm will have to review our financial statements on a quarterly basis and audit our financial statements on an annual basis. Moreover, our legal counsel will have to review and assist in the preparation of such reports. The costs charged by these professionals for such services cannot be accurately predicted at this time because factors such as the number and type of transactions that we engage in and the complexity of our reports cannot be determined at this time and will have a major affect on the amount of time to be spent by our auditors and attorneys. However, the incurrence of such costs will obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a profit. We may be exposed to potential risks resulting from any new requirements under Section 404 of the Sarbanes-Oxley Act of 2002. If we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantly.
THERE IS NO CURRENT TRADING MARKET FOR OUR SECURITIES AND IF A TRADING MARKET DOES NOT DEVELOP, PURCHASERS OF OUR SECURITIES MAY HAVE DIFFICULTY SELLING THEIR SHARES.
There is currently no established public trading market for our securities and an active trading market in our securities may not develop or, if developed, may not be sustained. We intend to have a market maker apply for admission to quotation of our securities on the Over-the-Counter Bulletin Board after the Registration Statement relating to this prospectus is declared effective by the SEC. We do not yet have a market maker who has agreed to file such application. If for any reason our common stock is not quoted on the Over-the-Counter Bulletin Board or a public trading market does not otherwise develop, purchasers of the share may have difficulty selling their common stock should they desire to do so. No market makers have committed to becoming market makers for our common stock and none may do so.
WE HAVE NO EXPERIENCE AS A PUBLIC COMPANY.
We have never operated as a public company. We have no experience in complying with the various rules and regulations, which are required of a public company. As a result, we may not be able to operate successfully as a public company, even if our operations are successful. We plan to comply with all of the various rules and regulations, which are required of a public company. However, if we cannot operate successfully as a public company, your investment may be adversely affected. Our inability to operate as a public company could be the basis of your losing your entire investment in us.
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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 faced by us described in the 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 will sell our shares at $0.06 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, by adding a $0.03 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering until and unless the security is subsequently listed on an exchange or is listed by a market maker on the OTC BB. Currently the company is not so listed and there is no assurance that the stock will ever be so listed.
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 880,000 shares of common stock offered through this prospectus. These shares were acquired from us in private placements that were exempt from registration under Regulation S promulgated pursuant to the Securities Act of 1933. All shares were acquired outside of the United States by non-U.S. persons. The shares include the following:
1. 720,000 shares of our common stock that the selling shareholders acquired from us in an offering that was completed on November 19, 2012;
2. 160,000 shares of our common stock that the selling shareholders acquired from us in an offering that was completed on December 14, 2012.
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The following table provides as of the date of this prospectus, 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.
Name Of Selling Shareholder |
Shares Owned Prior To This Offering |
Total Number Of Shares To Be Offered For Selling Shareholders Account |
Total Shares to Be Owned Upon Completion Of This Offering |
Percentage of Shares owned Upon Completion of This Offering |
Adan Adolfo Merlos Linares |
40,000 |
40,000 |
Nil |
Nil |
Luis Alonso Barrientos Lopez |
40,000 |
40,000 |
Nil |
Nil |
Roberto Orlando Garcia Tejada |
40,000 |
40,000 |
Nil |
Nil |
Edgar Orlando Rivera |
40,000 |
40,000 |
Nil |
Nil |
Marvin Benedicto Lue Morales |
40,000 |
40,000 |
Nil |
Nil |
Sarai Del Socorro Beltran Leonardo |
40,000 |
40,000 |
Nil |
Nil |
Fatima Sofia Rodas Delgado |
40,000 |
40,000 |
Nil |
Nil |
Sergio Ulises Armas Hernandez |
40,000 |
40,000 |
Nil |
Nil |
Elmer Leonidas Mendez Aquino |
40,000 |
40,000 |
Nil |
Nil |
Nelson Gerardo Paredez Guzman |
40,000 |
40,000 |
Nil |
Nil |
Xiomara Magdalena Ventura de Fajardo |
40,000 |
40,000 |
Nil |
Nil |
Antonio de Jesus Ortiz Espinoza |
40,000 |
40,000 |
Nil |
Nil |
Cecilia del Carmen Morales Ramon |
40,000 |
40,000 |
Nil |
Nil |
Cesar Armando Castillo Acevedo |
40,000 |
40,000 |
Nil |
Nil |
Tatiana Fabiola Alas Morales |
40,000 |
40,000 |
Nil |
Nil |
Claudia Maria Colindres Mendez |
40,000 |
40,000 |
Nil |
Nil |
Guadalupe Araceli Barillas Lopez |
40,000 |
40,000 |
Nil |
Nil |
Leticia Lizzette Gracia Chavez |
40,000 |
40,000 |
Nil |
Nil |
Jaime Henry Martinez Lemus |
20,000 |
20,000 |
Nil |
Nil |
Claudia Morales de Magana (1) |
20,000 |
20,000 |
Nil |
Nil |
Douglas Antonio Orozco Lemus |
20,000 |
20,000 |
Nil |
Nil |
Guillermo Alexander Lopez Moran |
20,000 |
20,000 |
Nil |
Nil |
Julio Renaldo Catota |
20,000 |
20,000 |
Nil |
Nil |
Mauricio Marcelo Shupan Pinto |
20,000 |
20,000 |
Nil |
Nil |
Moises Alberto Mejia Rivas |
20,000 |
20,000 |
Nil |
Nil |
Sandra Elizabeth Ruiz Lemus |
20,000 |
20,000 |
Nil |
Nil |
(1) Spouse of our sole officer and director Francisco Douglas Magana
Besides the above, there are no relationships between our selling shareholders and our sole officer and director.
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 880,000 shares of common stock issued and outstanding on the date of this prospectus.
Other than disclosed above, 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;
2. has ever been one of our officers or directors;
3. is a broker-dealer; or a broker-dealer's affiliate.
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Plan of Distribution
The selling shareholders may sell some or all of their common stock in one or more transactions, including block transactions. There are no arrangements, agreements or understandings with respect to the sale of these securities.
The selling shareholders will sell our shares at $0.06 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 by adding a $0.03 premium to the last sale price of our common stock to investors. This offering is priced at the time of the commencement of the offering and must remain offered at such price during the entire duration of the offering until and unless the security is subsequently listed on an exchange or is listed by a market maker on the OTC BB. Currently the company is not so listed and there is no assurance that the stock will ever be so listed.
The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144, when eligible.
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. If these shares being registered for resale are transferred from the named selling shareholders and the new shareholders wish to rely on the prospectus to resell these shares, then we must first file a prospectus supplement naming these individuals as selling shareholders and providing the information required concerning the identity of each selling shareholder and he or her relationship to us. There is no agreement or understanding between the selling shareholders and any partners with respect to the distribution of the shares being registered for resale pursuant to this registration statement.
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 of 1933 and the Securities Exchange Act of 1934 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:
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1. |
Not engage in any stabilization activities in connection with our common stock; |
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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 |
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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. |
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The Securities and Exchange Commission (the 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;
- 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 of such duties or other requirements;
- 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;
- a toll-free telephone number for inquiries on disciplinary actions;
- a definition of significant terms in the disclosure document or in the conduct of trading penny stocks; and
- 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.
Description of Securities
General
Our authorized capital stock consists of 75,000,000 shares of common stock at a par value of $0.001 per share.
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Common Stock
As of January 30, 2013 there were 3,880,000 shares of our common stock issued and outstanding held by 27 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 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.
Preferred Stock
We do not have an authorized class of preferred 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.
Share Purchase Warrants
We have not issued and do not have any outstanding warrants to purchase shares of our common stock.
Options
We have not issued and do not have any outstanding options to purchase shares of our common stock.
Convertible Securities
We have not issued and do not have any outstanding 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, an 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.
Stepp Law Corporation has provided an opinion on the validity of our common stock.
The financial statements included in this prospectus and the registration statement have been audited by Ronald R. Chadwick, P.C. to the extent and for the periods set forth in their report appearing elsewhere in this document and in the registration statement filed with the SEC, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.
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Description of Business
Overview
We were incorporated in the State of Nevada on September 7, 2012. To date, our business operations have been limited to primarily, the development of a business plan and execution of the consulting agreement with a Finca La Esmeralda, a private El Salvadorian company. We provide consulting services in commercial cultivation and processing of coffee in El Salvador. We plan to expand our services to North American market in the future if we have the available resources and growth to warrant it. We are a development stage company and cannot state with certainty whether we will achieve significant profitability. We have earned minimal revenues since inception and have minimal assets. Our plan of operation is forward-looking. It is likely that we will not be able to achieve significant profitability and might need to cease operations due to the lack of funding. We maintain our statutory registered agent's office at 2360 Corporate Circle, Ste. 400 Henderson, Nevada 89074-7722. Our business office is located at Res. San Antonio Bk. 10, Pje. 7 N5 San Antonio Del Monte, Sonsonate, El Salvador SV-106090030. Our telephone number is +011-503-79511698.
Consulting Services
Our consulting services for commercial growers of coffee include:
- Consulting in cultivation and harvesting processes
- Quality control
- Hygiene check
- Improvement of cultivation methods
- Improvement of fruiting techniques
- Improvement of coffee quality
- Instructing and training of staff
Our specific areas of services include the following:
Clients existing cultivation facilities:
1. Review of the current cultivation process used by clients.
2. Prepare a written recommendation for improvement of harvesting methods that are appropriate for existing facility. Special consideration should be given to the selection of the right seed for plantation conditions, rational harvesting, coffee quality, dissolved and injected fertilization and farm mechanization. After approval of any recommendations by client provide necessarily instructing and training of staff (if required).
3. Review of the harvesting methods, processing, packaging and storing of the product.
4. Review of the pest management, especially of berry borers, nematodes, and leaf rust fungus (Hemileia vastatix Berk. And Br.).
5. Prepare a written recommendation for improvement of harvesting, processing, packaging and storing of the product.
6. After the revision of contracts with product distributors prepare a written recommendation regarding marketing strategies, new distributors networks and logistic solutions.
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On-Call service:
1. Give verbal or written recommendations or instructions via phone, mail or email regarding any clients questions that are not mentioned above, but are related to commercial cultivation and processing of coffee.
Coffee Description
Coffee is a small perennial tree, 2 to 5 meters high, with opposing branches that are long, flexible and very thin. The coffee plant is a member of the family Rubiaceae, genus Coffea, of which two species are currently grown commercially: Coffea arabica L. and Coffea canephora. Coffea arabica is the most valued species due to its quality, making it the best known and most widely grown in the world.
El Salvadorian coffee varieties:
1. BOURBON
ORIGIN: Ethiopia; then to Arabia, Netherlands, France and Martinique, and from there to El Salvador. DESCRIPTION: tall plant, long branches, long internode spacing, open architecture, deep red berries.
GROWING ALTITUDE: from 800-1500 meters.
BEAN SIZE: length 0.95 cm; width 0.70 cm; thickness 0.36 cm.
BOURBON CUP QUALITY EVALUATION: Aroma: penetrating and rich, floral overtones, sweet, chocolate-like. Body: full-bodied with excellent mouthfeel. Acidity: medium to high, good brightness, very well balanced. Flavor: sweet and pleasant, with long persistence and complex chocolate- like attributes.
2. TEKISIC OR SALVADORAN BOURBON
ORIGIN: The Tekisic cultivar was obtained from the Bourbon variety in El Salvador. Its selection began in 1949 and it was released in 1977. The word Tekisic comes from the Nahuat tekiti, meaning work, and ISIC, Instituto Salvadoreño de Investigaciones del Café (Salvadoran Institute for Coffee Research). Therefore, Tekisic means the work of ISIC.
DESCRIPTION: tall plant, long internode spacing, broad plant architecture, branches that tend to form fans of secondary shoots, light green shoots.
GROWING ALTITUDE: from 800-1500 meters.
BEAN SIZE: length 0.82 cm; width 0.64 cm; thickness 0.35 cm.
3. PACAS
ORIGIN: Mutation of the Bourbon variety reported in Santa Ana, El Salvador in 1949.
DESCRIPTION: short plant; long branches; short internode spacing; dark green leaves; well-developed roots; tolerates wind, sun and drought; compact architecture.
GROWING ALTITUDE: from 600- 1000 meters.
BEAN SIZE: length 0.85 cm; width 0.66 cm; thickness 0.34 cm.
PACAS CUP QUALITY EVALUATION: Aroma: mild with a rich fragrance. Body: medium, with pleasant mouth feel. Acidity: medium, with notable finesse. Flavor: subtle sweetness and lots of finesse.
4. PACAMARA
ORIGIN: A Coffea arabica hybrid originating in El Salvador in 1958 by artificially crossing Pacas with Red Maragogipe, from where it gets the name Pacamara.
DESCRIPTION: mid-size plant; short internode spacing; large, corrugated, dark green leaves; large berries.
GROWING ALTITUDE: 1000 meters and higher.
BEAN SIZE: length 1.03 cm; width 0.71; thickness 0.37 cm.
PACAMARA CUP QUALITY EVALUATION: Aroma: pronounced, with floral overtones and complex chocolate-like sweetness. Body: pronounced, full- bodied, excellent mouthfeel. Acidity: high, elegant. Flavor: chocolate-like, very persistent.
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History of coffee growing in El Salvador
Since its accidental discovery in Ethiopia thousands of years ago, coffee has become a valuable global commodity, a necessity for millions of people who wake up every morning wanting a great cup of coffee.
The wild Coffea Arabica, discovered in ancient Ethiopia, was taken to Arabia between 575 and 850 by African tribes and the Sufis known as whirling dervishes. There, coffee cultivation became so widespread that a jealously guarded monopoly grew up around it, which protected the shipping ports to ensure that no fertile seed left port undetected. Beans would be roasted or boiled before leaving port so they couldnt germinate.
El Salvador is more than a country where coffee happens to be grownin many ways, it is a country created on coffee, as the crop is heavily woven into El Salvadors history, culture, economy and ecology.
Coffee has a long history in El Salvador, as the first coffee was believed to have arrived there from the Caribbean as early as 1740. Although coffee was grown in the western part of the country for a long period, production did not rise until 1850s and later. The country shipped its first bags of coffee to Europe
in 1856, and by the 70s, El Salvador was ranked fourth among coffee export countries, harvesting 3.5 million coffee bags.
With such a long history of coffee, it is not surprising that El Salvador knows how to produce a good cup. Coffee flavors range from caramel and chocolate to berries and florals. El Salvadors top quality coffees have been variously described by world-class cuppers as balanced, with vibrant, berry-like, chocolate and floral notes and bright acidity. The coffees are consistent and creamy, with flavors of vanilla and caramel, a good body and a chunky aroma.
The countrys climate is well-suited for creating delicious coffees, with its six-month long wet and dry seasons, various mountain ranges and volcanoes, and extensive shade canopy. The majority of coffee is grown on volcanic slopes, which experts believe plays a substantial role in the flavor of the coffee.
Coffee is grown in five geographical areas of the country, which differ from one another mainly in terms of altitude and flavor characteristics:
Apaneca-Ilamatepec Mountain Range -located in the western region, with altitudes ranging from 1,640 to 6,561 feet.
Central Belt - comprising the Balsamo Mountain Range and the San Salvador Volcano, with altitudes of 1,540 to 4,920 feet.
Chinchontepec or San Vicente Volcano - altitudes are 1,640 to 3,280 feet, with the San Vicente Volcano rising to 7,155 feet.
Cacahuatique Mountain Range - ranges in altitudes from 1,640 to 4,920 feet.
Tecapa-Chinchontepec Mountain Range - various altitudes, from 1,640 to 4,920 feet and up. The San Miguel or Chaparrastique Volcano is the highest peak with an elevation of 7,017 feet.
Cultivation & Processing
El Salvador produces only arabica coffees, mostly traditional varieties such as bourbon and pacas. Some hybridsincluding pacamara, caturra, catuai and catisicare also grown, but in very small amounts. It is estimated that there are some 23,000 coffee growers in the country, about 87 percent of which are small farmers, with farms of 19 hectares or less. Many focus on organic and bird-friendly growing procedures.
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In addition, most farms are diverse, producing a variety of fruits, vegetables and flowers in addition to coffee.
El Salvador has a strong coffee infrastructure, designed to help producers create the best possible crop. Plantations and mills are near each other; thus, coffee is often hand-picked and de-pulped the same day. Strong sunlight allows the coffee to be patio-dried.
The El Salvadorian coffee harvest runs from October to March. Cherries are hand-picked when they have a deep red-wine color and are processed the same day. Quality is strictly controlled during every step of processing to ensure that the best attribute of El Salvadorian coffee come through in every cup.
El Salvadorian coffee growers recycle the resources extracted when coffee is grown, returning them to the
soil and environment. The pulp is used as organic matter and the hulls are used for fuel during processing. Solid and liquid waste are treated and disposed of properly.
To summarize El Salvador Coffee at a glance:
- Coffee Arabica: 68 percent bourbon, 29 percent pacas and 3 percent hybrids such as pacamara, caturra and catuai.
- Flavor: characterized by good body and balanced acidity, an excellent sweetness and rich, penetrating aromas.
- Main Growing Regions: Apaneca-Ilamatepec Mountain Range, Central Belt, Chichontepec, Cacahuatique Mountain Range, Tecapa- Chichontepec Mountain Range.
- Elevation: 500 to more than 1,200 meters.
- Farms: an estimated 23,000 growers, 87 percent of which are small farmers with 19 hectares or less.
- Flowering: FebruaryMay
- Harves: OctoberMarch
- Shipping: DecemberAugust
- Processing: majority washed and sun-dried
- Main Buyers: Germany, United States, Belgium, Canada, The Netherlands
Providers of the consulting services in commercial cultivation and processing of coffee
We are a new and un-established company, have a weak competitive position in the industry and have earned revenues of only $2,400. We have a net income of $951 from September 7, 2012 (date of inception) to December 31, 2012.
We need capital to carry out our current business plan. We also anticipate that we will require an additional minimum financing approximately $7,000 in order to execute our business plan. We may not have sufficient financing to sustain our current operations. Many of the companies with whom we compete have greater financial and technical resources than those available to us. It is uncertain whether consulting services offered by Vanell, Corp. will achieve and sustain high levels of demand and market acceptance. The development of the markets for the consulting services in commercial cultivation and processing of coffee will be dependent upon larger corporations, domestic companies and service pricing.
Presently in the local El Salvadorian market and in especially in Central America there are some well-structured long standing consulting companies in coffee growing and processing in the marketplace.
Direct competitors include those consulting companies offering services in commercial cultivation and processing of coffee and located throughout El Salvador and Central America.
Indirect competitors are those coffee consulting companies in El Salvador and Central America that focus on a different target market.
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Marketing Our Product
We plan to market our services in El Salvador. Initially, our services will be promoted by our President, Mr. Francisco Douglas Magana. He will discuss our product with his friends and business associates. The marketing and advertising will be targeted to commercial coffee growers in the country, farmers, coffee plantations and mills in El Salvador. We intend to develop and maintain a database of potential clients who may want to use Vanells services. We will follow up with these clients periodically and offer them free presentations and special discounts from time to time. Our methods of communication will include: phone calls, email, and regular mail. We will ask our satisfied clients for referrals.
We will market and advertise our product on our web site by showing its advantages over consulting services in coffee growing and processing offered by other companies. We intend to attract traffic to our website by a variety of online marketing tactics such as registering with top search engines using selected key words (meta tags) and utilizing link and banner exchange options. We intend to promote our website by displaying it on our promotion materials. We also plan to attend business shows in our industry to showcase our services with a view to find new customers.
We plan to expand our services to North American market in the future only when or if we have the available resources and growth to warrant it. Currently this option is questionable.
Revenues
The companys revenues will be what we charge our clients for our consulting services.
Please note that below numbers are estimated in nature and are meant to show the capacity of the company without hiring additional employees and not a guarantee of future revenues.
Estimated prices for our consulting services are:
- Initial Meeting with Client - free of charge;
- Consulting Fee, small commercial coffee growers in El Salvador and Central America - varies depending on length of the project and scope of work involved, starting from USD 85.
- Consulting Fee, mid-sized commercial coffee growers in El Salvador and Central America - varies depending on length of the project and scope of work involved, starting from USD 100.
Invoicing will be on a monthly basis, beginning after we have completed our first four weeks of service. Vanell, Corp. shall have discretion in selecting the dates and times it performs consulting services throughout the month giving due regard to the needs of the clients business. All actual reasonable and necessary expenditures, which are directly related to the consulting services, are to be reimbursed by the clients.
On November 26, 2012 we signed the service agreement with Finca La Esmeralda, an El Salvador based company specializing in cultivation of coffee. We cannot guarantee that we will be able to find additional successful contracts with the potential customers in need of coffee cultivation consulting services in El Salvador and Central America, in which case our business may fail and we will have to cease our operations.
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Competition
Our competitors will include El-Salvadorian companies providing consulting services in commercial cultivation and processing of coffee. We will not be differentiating ourselves from the foregoing, but merely competing with them. The market of consulting services in coffee growing and processing is large and fragmented, and may be difficult to penetrate. Our competitive position within the industry is negligible in light of the fact that we have just started our operations. Older, well-established companies providing similar services with records of success currently attract customers. Since we have just started operations, we cannot compete with them on the basis of reputation. We do expect to compete with them on the basis of the range of coffee consulting services and the quality of consulting services that we intend to provide. There can be no assurance that we can maintain a competitive position against current or future competitors, particularly those with greater financial, marketing, service, technical and other resources. Our failure to maintain a competitive position within the market could have a material adverse effect on our business, financial condition and results of operations. At this time, our principal method of competition will be through personal contact with potential clients.
Agreement
On November 26, 2012 Consulting Service Agreement was signed with Finca La Esmeralda, an El Salvador based company.
The agreement with Finca La Esmeralda contains the following material terms:
2. Term of Agreement/Termination: The term of this Agreement shall be for 12 months beginning from the Effective Date, unless terminated earlier as provided herein. CLIENT may terminate this Agreement for any reason upon twenty (20) days advance written notice to Consultant. Consultant may terminate this Agreement in the event that CLIENT commits a breach of its material obligations hereunder, upon twenty (20) days advance written notice and where CLIENT does not cure the breach.
3. Payment: The CLIENT will pay to Consultant $85.00 per hour for services rendered to the CLIENT under this Agreement. CLIENT should be invoiced for consulting fees in an amount not to exceed $2,500 per month. Invoicing should be on a monthly basis, beginning after the Consultant has completed his first four (4) weeks of service. Under no circumstances shall Consultant perform work having a value (based on the agreed upon per hour rate) in excess of the maximum permitted fee. Consultant shall have discretion in selecting the dates and times it performs consulting services throughout the month giving due regard to the needs of the CLIENTs business. Payment by CLIENT is due within thirty (30) days from receipt of an approved invoice. The CLIENT agrees to reimburse Consultant for all actual reasonable and necessary expenditures, which are directly related to the consulting services. These expenditures include, but are not limited to, expenses related to travel (i.e. airfare, hotel, temporary housing, meals, parking, mileage, etc.), telephone calls, and postal expenditure. Expenses incurred by Consultant will be reimbursed by the CLIENT within 15 days of Consultants proper written request for reimbursement.
4. Invoices/Reporting: All invoices submitted to CLIENT by Consultant for payment must include a written, task based report detailing the services actually and reasonably provided by Consultant to CLIENT along with the time spent by Consultant performing the same. Consultant shall certify in writing that each such invoice is complete and accurate. Payment is contingent on provision of such invoices. Consultant shall provide technical reports in accordance with the Scope of Work attached as Exhibit A.
Initially, our director Mr. Francisco Douglas Magana will work with the current service agreement. In the future we also expect Mr. Magana to work on potential service agreements with other El-Salvadorian/Central American companies.
We cannot guarantee that we will be able to find additional successful contracts with El-Salvadorian companies, in which case our business may fail and we will have to cease our operations.
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Description of property
We do not have an ownership or leasehold interest in any property.
Insurance
We do not maintain any insurance and do not intend to maintain insurance in the future. Because we do not have any insurance, if we are made a party of a products liability action, we may not have sufficient funds to defend the litigation. If that occurs a judgment could be rendered against us that could cause us to cease operations.
Employees. Identification of Certain Significant Employees
We are a development stage company and currently have no employees, other than our sole officer and director Mr. Francisco Douglas Magana. We intend to hire additional employees on an as needed basis.
Research and Development Expenditures
We have not incurred any other research or development expenditures since our incorporation.
Government Regulation
We will be required to comply with all regulations, rules and directives of governmental authorities and agencies applicable to the construction and operation of any facility in any jurisdiction which we would conduct activities.
Subsidiaries
We do not have any subsidiaries.
Patents and Trademarks
We do not own, either legally or beneficially, any patents or trademarks.
Offices
Our office is currently located at Res. San Antonio Bk. 10, Pje. 7 N5 San Antonio Del Monte, Sonsonate, El Salvador SV-106090030. Our telephone number is +011-503-79511698. This is the office of our Director, Mr. Francisco Douglas Magana. We do not pay any rent to Mr. Magana and there is no agreement to pay any rent in the future. Upon the completion of our offering, we do not intend to establish an office elsewhere.
Legal Proceedings
We are not currently a party to any legal proceedings. Our address for service of process in Nevada is 2360 Corporate Circle, Ste. 400 Henderson, Nevada 89074-7722.
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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 have 27 registered shareholders.
Rule 144 Shares
A total of 3,000,000 shares of our common stock are available for resale to the public in accordance with the volume and trading limitations of Rule 144. Pursuant to Rule 144, a person who has beneficially owned restricted shares of our common stock for at least six months is entitled to sell their securities provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding the sale and (ii) we are subject to the Securities Exchange Act of 1934 periodic reporting requirements for at least three months before the sale.
Persons who have beneficially owned restricted shares of our common stock for at least six months but who are our affiliates at the time of, or at any time during the three months preceding the sale, are subject to additional restrictions. Such person is entitled to sell within any three-month period only a number of securities that does not exceed the greater of either of the following:
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1% of the total number of securities of the same class then outstanding, which will equal 38,800 shares as of the date of this prospectus; or |
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the average weekly trading volume of such securities during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale; |
provided, in each case that we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale.
Such sales must also comply with the manner of sale and notice provisions of Rule 144.
As of the date of this prospectus, persons who are our affiliates hold all of the 3,000,000 shares that may be sold pursuant to Rule 144.
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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 Nevada 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 |
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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.
Plan of Operation
We are a development stage corporation. To date, our business operations have been limited to primarily, the development of a business plan, the completion of private placements for the offer and sale of our common stock, discussing the offer of coffee growing consulting services with potential customers and execution of the service agreement with Finca La Esmeralda, a private El-Salvadorian company. As of January 30, 2013 we realized revenues of $2,400 from our business operations.
Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because no significant revenues are anticipated until we implement our business plan and execute additional service agreements. We are not raising any money in this offering. Our only sources for cash at this time are investments by shareholders in our company,cash advances from our sole director Francisco Douglas Magana and revenues pursuant to the signed agreement.
There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
Our office is currently located at Res. San Antonio Bk 10, Pje 7 N5 San Antonio Del Monte, Sonsonate, El Salvador, SV-106090030. This is the office of our Director, Mr. Francisco Douglas Magana. We do not pay any rent to Mr. Magana and there is no agreement to pay any rent in the future. Upon the completion of our offering, we do not intend to establish an office elsewhere. To service our current contract with Finca La Esmeralda we are relying on equipment from Mr. Maganas business, FDMag S.A. de C.V. We anticipate to rely on Mr. Maganas current business resources until we have available funds to obtain our own equipment and PCs. Currently, this option is highly questionable, as no significant revenues are anticipated until we fully implement our business plan.
We will not be conducting any product research or development. We do not expect to purchase or sell plant or significant equipment. Further we do not expect significant changes in the number of employees. Upon completion of our public offering, our specific goal is to profitably sell our services.
27 | Page
Following the date of this registration statement, our business plan for the next 12 months is as follows:
February-June, 2013: Negotiate service agreements with potential customers.
Initially, our sole officer and director, Mr. Magana, will look for potential customers. On November 26, 2013, we signed a service agreement with Finca La Esmeralda, a private El-Salvadorian company. During February-June, 2013 we plan to contact and start negotiations with other potential customers in El Salvador through our officer and sole director Francisco Maganas network of friends and business associates in El Salvador. We will negotiate terms and conditions of collaboration. We will continue to search for new potential customers during the life of our operations. As of January 30, 2013 Finca La Esmeralda is the only El-Salvadorian company with which we have signed service agreement.
Even though the negotiation of additional agreements with customers will be ongoing during the life of our operations, we cannot guarantee that we will be able to find successful agreements, in which case our business may fail and we will have to cease our operations.
Even if we are able to obtain sufficient number of service agreements at the end of the twelve month period, there is no guarantee that we will be able to attract and more importantly retain enough customers to justify our expenditures. If we are unable to generate a significant amount of revenue and to successfully protect ourselves against those risks, then it would materially affect our financial condition and our business could be harmed.
We are not raising any money in this offering. Our only sources for cash at this time are investments by shareholders in our company, cash advances from our sole director Mr. Francisco Douglas Magana and revenues realized pursuant to the signed agreement. There is no assurance that any additional financing will be available or if available, on terms that will be acceptable to us. Failure to raise additional financing will cause us to go out of business. If this happens, you could lose all or part of your investment.
April-July, 2013: Commence Marketing Campaign. Estimated cost $7,000.
We intend to use marketing strategies, such as web advertisements, direct mailing, and phone calls to acquire potential customers. We also expect to get new clients from "word of mouth" advertising where our new clients will refer their colleagues to us.
We also plan to attend shows and exhibitions in commercial coffee growing and processing, which help commercial coffee growers in El Salvador come face to face and find new business opportunities and partners. We intend to spend about $7,000 on marketing efforts during the first year. Marketing is an ongoing matter that will continue during the life of our operations.
August-October, 2013: Develop Website. Estimated Cost $3,000.
By August of 2013 of 2012, assuming available recourses and company growth as planned we intend to begin developing our website. Our director, Mr. Magana will be in charge of registering our web domain. Once we register our web domain, we plan to hire a web designer to help us design and develop our website. We do not have any written agreements with any web designers at current time. The website development costs, including site design and implementation will be approximately $3,000. Updating and improving our website will continue throughout the lifetime of our operations.
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October, 2013-February, 2014: Hire Part-Time Coffee Growing and processing Specialist. Estimated Cost $5,000
Initially, our director will look for potential customers in commercial coffee growing industry. We intend to use marketing strategies, such as direct mailing, phone calls and e-mails to potential customers. Once we begin to execute additional service agreements and have funds available for growth we may hire one part-time coffee growing and processing specialist with good knowledge and broad connections to the commercial coffee growing industry. This individual will be an independent contractor compensated solely in the form of commissions, calculated as a percentage of net profits generated from execution of service agreements.
We therefore expect to incur the following costs in the next 12 months in connection with our business operations:
Marketing costs |
$ 7,000 |
Website development costs |
3,000 |
Commissions of PT Consulting Specialist |
5,000 |
Estimated cost of this offering |
8,000 |
Costs associated with being a publicly reporting company |
7,000 |
Total |
$30,000 |
Our current 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 anticipate that additional funding will be from the sale of additional common stock or revenues realized pursuant to the signed agreement with Finca La Esmeralda. We may seek to obtain short-term loans from our director as well, although no such arrangement has been made.
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Limited operating history; need for additional capital
There is no historical financial information about us upon which to base an evaluation of our performance. We are in start-up stage operations and have generated revenues of $2,400 as of January 30, 2013. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to price and cost increases in services and products.
Our current 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 anticipate that additional funding will be from the sale of additional common stock. We may seek to obtain short-term loans from our director as well, although no such arrangement has 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 director to meet our obligations over the next twelve months. We do not have any arrangements in place for any future equity financing. If we are unable to raise the required financing, our operations could be materially adversely affected and we could be forced to cease operations.
Results of Operations for Period Ending December 31, 2012
Since our inception on September 7, 2012 to December 31, 2012, we have earned net income of $951. As of December 31, 2012 we had cash of $23,663 in our bank accounts. However, we anticipate that we will incur substantial losses over the next 12 months.
We are dependent upon obtaining financing to continue with our business plan. For these reasons, there is substantial doubt that we will be able to continue as a going concern.
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 S-1 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 Commissions 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, 100 F Street NE, Washington, D.C. 20549. D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms.
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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.
Reports to Security Holders
Upon effectiveness of this Prospectus, we will be subject to the reporting and other requirements of the Exchange Act. We will make available to our shareholders annual reports containing financial statements audited by our independent auditors and our quarterly reports containing unaudited financial statements for each of the first three quarters of each year; however, we will not send the annual report to our shareholders unless requested by an individual shareholder.
The public may read and copy any materials that we file with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. The address of that site is www.sec.gov.
Directors, Executive Officers, Promoters and Control Persons
Our executive officer and director and his age as of the date of this prospectus is as follows:
Director:
Name of Director |
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Age |
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Francisco Douglas Magana |
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31 |
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Executive Officers: |
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Name of Officer |
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Age |
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Office |
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Francisco Douglas Magana |
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31 |
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President, Chief Executive Officer, Treasurer, Chief Financial Officer and Chief Accounting Officer, Secretary |
Biographical Information
Set forth below is a brief description of the background and business experience of our officers and sole director for the past five years.
Mr. Magana has acted as our sole President, Chief Executive Officer, Treasurer, Chief Financial Officer, Chief Accounting Officer, Secretary and sole member of our board of directors since our incorporation on September 7, 2012. Mr. Magana owns 77.32% of the outstanding shares of our common stock.
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Mr. Magana graduated with a Bachelor of Science in Agriculture from Universidad de El Salvador (University of El Salvador) in 2004. After graduation Mr. Magana has been working for various coffee plantations and mills in El Salvador, whose businesses were involved in the cultivation, harvesting methods, processing, packaging, storing and marketing of coffee. In 2007 Mr. Magana opened his own agricultural company FDMag S.A. de C.V. specializing in commercial production of coffee. Since 2009 and until present in addition to production of coffee Mr. Magana has been providing consulting services to coffee growers in El Salvador and Central America. Since 2007 FDMag S.A. de C.V. is the only company Mr. Magana has worked for. Mr. Maganas experiences, qualifications and attributes have led to our conclusion that Mr. Francisco Douglas Managa should be serving as a member of our Board of Directors in light of our business and structure. Mr. Magana intends to devote close to 40% (25 hours /week) of his time to planning and organizing activities of Vanell, Corp.
During the past ten years, Mr. Magana has not been the subject to any of the following events:
1. Any bankruptcy petition filed by or against any business of which Mr. Magana was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.
2. Any conviction in a criminal proceeding or being subject to a pending criminal proceeding.
3. An order, judgment, or decree, not subsequently reversed, suspended or vacated, or any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting Mr. Maganas involvement in any type of business, securities or banking activities.
4. Found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodity Future Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
Significant Employees
We have no significant employees other than our officers and sole director.
Audit Committee Financial Expert
We do not have an audit committee financial expert. We do not have an audit committee financial expert because we believe the cost related to retaining a financial expert at this time is prohibitive. Further, because we have no operations, at the present time, we believe the services of a financial expert are not warranted.
Conflicts of Interest
Mr. Francisco D. Magana, our President will be devoting approximately 40% (25 hours/week) of him time to our operations. Because Mr. Magana will only be devoting limited time to our operations, our operations may be sporadic and occur at times which are convenient to him. As a result, operations may be periodically interrupted or suspended which could result in a lack of revenues and a cessation of operations.
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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 from our incorporation on September 7, 2012 to December 31, 2012 (our fiscal year end) and subsequent thereto to the date of this prospectus.
SUMMARY COMPENSATION TABLE |
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Change in
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Francisco Douglas Magana President, CEO, CFO, Treasurer, Chief Accounting Officer, sole director and Secretary |
2012 |
None |
None |
None |
None |
None |
None |
None |
None |
Francisco Douglas Magana President, CEO, CFO, Treasurer, Chief Accounting Officer, sole director and Secretary |
2013 |
None |
None |
None |
None |
None |
None |
None |
None |
Stock Option Grants
We have not granted any stock options to our executive officer since our inception.
Consulting Agreements
We do not have an employment or consulting agreement with our officer or director. We do not pay him for acting as a director or officer.
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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 the date of this prospectus, and by the officers and directors, individually and as a group. Except as otherwise indicated, all shares are owned directly.
Title of |
Name and address |
Amount of beneficial |
Percent |
Class |
of beneficial owner |
ownership |
of class |
Common |
Francisco Douglas Magana |
3,000,000 |
77.32% |
Stock |
President, Chief Executive Officer, Chief Financial Officer, |
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Treasurer, Chief Accounting Officer, sole Director and Secretary |
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Res. San Antonio Bk. 10, Pje. 7 N5 San Antonio Del Monte, Sonsonate, El Salvador, SV-106090030 |
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Common |
Officer and Director as a |
3,000,000 |
77.32% |
Stock |
group that consists of one person |
shares |
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The percent of class is based on 3,880,000 shares of common stock issued and outstanding as of the date of this prospectus.
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, except as indicated:
· 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 5% of the voting rights attached to our outstanding shares of common stock;
· Any relative or spouse of any of the foregoing persons who has the same house as such person;
· Immediate family members of directors, director nominees, executive officers and owners of 5% or more of our common stock.
On October 1, 2012 we issued a total of 3,000,000 shares of restricted common stock to Mr. Magana for total cash proceeds of $3,000.
Disclosure of Commission Position Of Indemnification for
Securities Act of 1933 Liabilities
We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act of 1933 is against public policy as expressed in the Securities Act of 1933, 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.
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FINANCIAL STATEMENTS
Index to Financial Statements :
1. |
Report of Independent Registered Public Accounting Firm; |
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2. |
Audited financial statements for the period from inception (September 7, 2012) to December 31, 2012 |
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a. |
Balance Sheet; |
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b. |
Statement of Operations; |
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c. |
Statement of Cash Flows; |
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d. |
Statement of Stockholders' Equity; and |
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e. |
Notes to Financial Statements |
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RONALD R. CHADWICK, P.C.
Certified Public Accountant
2851 South Parker Road, Suite 720
Aurora, Colorado 80014
Telephone (303)306-1967
Fax (303)306-1944
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Board of Directors
Vanell, Corp.
Henderson, Nevada
I have audited the accompanying balance sheet of Vanell, Corp. (a development stage company) as of December 31, 2012, and the related statements of operations, stockholders' equity and cash flows for the period from September 7, 2012 (inception) through December 31, 2012. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Vanell, Corp. as of December 31, 2012, and the results of its operations and its cash flows for the period from September 7, 2012 (inception) through December 31, 2012 in conformity with accounting principles generally accepted in the United States of America.
Aurora, Colorado January 16, 2013 |
Ronald R. Chadwick, P.C. RONALD R. CHADWICK, P.C. |
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The accompanying notes are an integral part of these financial statements.
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VANELL, CORP. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF OPERATIONS |
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FOR THE PERIOD FROM INCEPTION (SEPTEMBER 7, 2012) to DECEMBER 31, 2012 |
Revenues |
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$ 2,400 |
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Operating Expenses |
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General and administrative expenses |
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1,211 |
Total operating expenses |
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1,211 |
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Net income from operations |
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1,189 |
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Provision for corporate income taxes |
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238 |
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Net income |
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$ 951 |
Loss per common share Basic |
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(0.00) |
Weighted Average Number of Common Shares Outstanding-Basic |
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2,711,624 |
The accompanying notes are an integral part of these financial statements.
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VANELL, CORP. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF STOCKHOLDERS EQUITY FOR THE PERIOD FROM INCEPTION (SEPTEMBER 7, 2012) TO DECEMBER 31, 2012 |
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Number of common Shares |
Amount |
Additional Paid-in- Capital |
Deficit accumulated during the development stage |
Total |
Balance at inception |
- |
$ - |
$ - |
$ - |
$ - |
Common shares issued for cash at $0.001 |
3,000,000 |
3,000 |
- |
- |
3,000 |
Common shares issued for cash at $0.02 |
720,000 |
720 |
13,680 |
- |
14,400 |
Common shares issued for cash at $0.03 |
160,000 |
160 |
4,640 |
- |
4,800 |
Net income |
- |
- |
- |
951 |
951 |
Balance as of December 31, 2012 |
3,880,000 |
$ 3,880 |
$ 18,320 |
$ 951 |
$ 23,151 |
The accompanying notes are an integral part of these financial statements.
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VANELL, CORP. (A DEVELOPMENT STAGE COMPANY) STATEMENT OF CASH FLOWS |
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FOR THE PERIOD FROM INCEPTION (SEPTEMBER 7, 2012) to DECEMBER 31, 2012 |
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Operating Activities |
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Net income Income taxes payable |
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$ 951 238 |
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Net cash provided by (used in) operating activities |
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1,189 |
Financing Activities |
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Sale of common stock |
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22,200 |
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Loans from Shareholders |
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274 |
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Net cash provided by financing activities |
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22,474 |
Net increase (decrease) in cash and equivalents |
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23,663 |
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Cash and equivalents at beginning of the period |
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- |
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Cash and equivalents at end of the period |
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$ 23,663 |
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Supplemental cash flow information: |
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Cash paid for: |
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Interest |
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$ - |
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Taxes |
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$ - |
Non-Cash Financing Activities |
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$ - |
The accompanying notes are an integral part of these financial statements.
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VANELL, CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE FINANCIAL STATEMENTS
DECEMBER 31, 2012
NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization and Description of Business
VANELL, CORP. (the Company) was incorporated under the laws of the State of Nevada, U.S. on September 7, 2012. The Company is in the development stage as defined under Statement on Financial Accounting Standards Accounting Standards Codification FASB ASC 915-205 "Development-Stage Entities. Since inception through December 31, 2012 the Company has income of $951. Company provides consulting services to commercial growers of coffee in El Salvador.
Cash and Cash Equivalents
The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes.
The Company's bank accounts are deposited in insured institutions. The funds are insured up to $250,000. At December 31, 2012 the Company's bank deposits did not exceed the insured amounts.
Basic Income (Loss) Per Share
The Company computes loss per share in accordance with ASC-260, Earnings per Share which requires presentation of both basic and diluted earnings per share on the face of the statement of operations. Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of outstanding common shares during the period. Diluted loss per share gives effect to all dilutive potential common shares outstanding during the period. Dilutive loss per share excludes all potential common shares if their effect is anti-dilutive.
Dividends
The Company has not adopted any policy regarding payment of dividends. No dividends have been paid during any of the periods shown.
Income Taxes
The Company follows the liability method of accounting for income taxes. Under this method, deferred income tax assets and liabilities are recognized for the estimated tax consequences attributable to differences between the financial statement carrying values and their respective income tax basis (temporary differences). The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
Advertising Costs
The Companys policy regarding advertising is to expense advertising when incurred. The Company incurred advertising expense of $0 during as at December 31, 2012.
Accounting Basis
The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (GAAP accounting). The Company has adopted December 31 fiscal year end.
Impairment of Long-Lived Assets
The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets may not be recoverable. When such events or changes in circumstances are present, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such assets will be recovered through undiscounted expected future cash flows. If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or the fair value less costs to sell.
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Recent accounting pronouncements
We have reviewed all the recent accounting pronouncements issued to date of the issuance of these financial statements, and we do not believe any of these pronouncements will have a material impact on the company.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Stock-Based Compensation
As of December 31, 2012 the Company has not issued any stock-based payments to its employees. Stock-based compensation is accounted for at fair value in accordance with SFAS No. 123 and 123(R) (ASC 718). To date, the Company has not adopted a stock option plan and has not granted any stock options.
Revenue Recognition
The Company will recognize revenue when products are fully delivered or services have been provided and collection is reasonably assured.
NOTE 2 COMMON STOCK
The Company has 75,000,000 common shares authorized with a par value of $ 0.001 per share. On October 2, 2012, the Company issued 3,000,000 shares of its common stock at $0.001 per share for total proceeds of $3,000. In October and November 2012, the Company issued 720,000 shares of its common stock at $0.02 per share for total proceeds of $14,400. In December 2012, the Company issued 160,000 shares of its common stock at $0.03 per share for total proceeds of $4,800.
During the period September 7, 2012 (inception) to December 31, 2012, the Company sold a total of 3,880,000 shares of common stock for total cash proceeds of $22,200.
NOTE 3 RELATED PARTY TRANSACTIONS
On October 2, 2012, the Company sold 3,000,000 shares of common stock at a price of $0.001 per share to its director.
On September 7, 2012, the Director loaned $274 to the Company to pay for incorporation expenses. This loan is non-interest bearing, due upon demand and unsecured.
NOTE 4 SUBSEQUENT EVENTS
The Company has evaluated subsequent events from December 31, 2012 to the date the financial statements were issued and has determined that there are no items to disclose.
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SUBJECT TO COMPLETION, DATED _____________, 2013
PROSPECTUS
VANELL, CORP.
880,000 SHARES
COMMON STOCK
Dealer Prospectus Delivery Obligation
Until ________________________, all dealers that effect transactions in these securities whether or not participating in this offering may be required to deliver a prospectus. This is in addition to the dealer's obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
43 | Page
Other Expenses of Issuance and Distribution
The estimated costs of this offering are as follows:
Securities and Exchange Commission registration fee |
$ |
20 |
Transfer Agent Fees |
|
2,000 |
Accounting fees and expenses |
|
3,000 |
Legal fees and expenses |
|
2,500 |
Edgar filing fees |
|
480 |
|
|
|
Total |
$ |
8,000 |
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 other costs of sale.
Indemnification of Directors and Officers
Our sole officer and director is indemnified as provided by the Nevada Revised Statutes (NRS) 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:
Our bylaws provide that we will indemnify our directors and officers to the fullest extent not prohibited by Nevada 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. |
44 | Page
Our bylaws provide that we will advance all expenses incurred 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 our director or officer, or is or was serving at our request 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. This advance of expenses is to be made upon receipt of an undertaking by or on behalf of such person to repay said amounts should it be ultimately determined that the person was not entitled to be indemnified under our bylaws or otherwise.
Our bylaws also provide that no advance shall be made by us to any officer 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 our best interests.
Recent Sales of Unregistered Securities
We issued 3,000,000 shares of our common stock to Mr. Magana on October 1, 2012, who has been our President, Chief Executive Officer, Treasurer, and our sole director since our inception on September 7, 2012. He acquired these 3,000,000 shares at a price of $0.001 per share for total proceeds to us of $3,000.00. These shares were issued pursuant to Regulation S promulgated pursuant to the Securities Act of 1933.
The shares were issued with a Rule 144 restrictive legend.
As of January 30, 2013 Mr. Magana had 3,000,000 restricted shares of common stock of Vanell, Corp.
We completed an offering of 720,000 shares of our common stock at a price of $0.02 per share to the following 18 purchasers on November 19, 2012:
Name of Subscriber |
Number of Shares |
Adan Adolfo Merlos Linares |
40,000 |
Luis Alonso Barrientos Lopez |
40,000 |
Roberto Orlando Garcia Tejada |
40,000 |
Edgar Orlando Rivera |
40,000 |
Marvin Benedicto Lue Morales |
40,000 |
Sarai Del Socorro Beltran Leonardo |
40,000 |
Fatima Sofia Rodas Delgado |
40,000 |
Sergio Ulises Armas Hernandez |
40,000 |
Elmer Leonidas Mendez Aquino |
40,000 |
Nelson Gerardo Paredez Guzman |
40,000 |
Xiomara Magdalena Ventura de Fajardo |
40,000 |
Antonio de Jesus Ortiz Espinoza |
40,000 |
Cecilia del Carmen Morales Ramon |
40,000 |
Cesar Armando Castillo Acevedo |
40,000 |
Tatiana Fabiola Alas Morales |
40,000 |
Claudia Maria Colindres Mendez |
40,000 |
Guadalupe Araceli Barillas Lopez |
40,000 |
Leticia Lizzette Gracia Chavez |
40,000 |
The total amount received from this offering was $14,400. We completed this offering pursuant to Regulation S of the Securities Act.
45 | Page
We completed an offering of 160,000 shares of our common stock at a price of $0.03 per share to the following 8 purchasers on December 14, 2012:
Name of Subscriber |
Number of Shares |
Jaime Henry Martinez Lemus |
20,000 |
Claudia Morales de Magana |
20,000 |
Douglas Antonio Orozco Lemus |
20,000 |
Guillermo Alexander Lopez Moran |
20,000 |
Julio Renaldo Catota |
20,000 |
Mauricio Marcelo Shupan Pinto |
20,000 |
Moises Alberto Mejia Rivas |
20,000 |
Sandra Elizabeth Ruiz Lemus |
20,000 |
The total amount received from this offering was $4,800. We completed this offering pursuant to Regulation S of the Securities Act.
Regulation S Compliance
Each offer or sale was made in an offshore transaction;
We did not make any directed selling efforts in the United States. We also did not engage any distributors, any respective affiliates, nor any other person on our behalf to make directed selling efforts in the United States;
Offering restrictions were, and are, implemented;
No offer or sale was made to a U.S. person or for the account or benefit of a U.S. person;
Each purchaser of the securities certifies that it was not a U.S. person and was not acquiring the securities for the account or benefit of any U.S. person;
Each purchaser of the securities agreed to resell such securities only in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act of 1933, or pursuant to an available exemption from registration; and agreed not to engage in hedging transactions with regard to such securities unless in compliance with the Securities Act of 1933;
The securities contain a legend to the effect that transfer is prohibited except in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act of 1933, or pursuant to an available exemption from registration; and that hedging transactions involving those securities may not be conducted unless in compliance with the Securities Act of 1933; and
We are required by law to refuse to register any transfer of the securities not made in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act of 1933, or pursuant to an available exemption from registration.
46 | Page
Exhibits
Exhibit |
|
|
Number |
|
Description |
|
|
|
3.1 |
|
Articles of Incorporation |
3.2 |
|
By-Laws |
5.1 |
|
|
10.1 |
|
Professional Service Agreement with Finca La Esmeralda |
23.1 |
|
Consent of Ronald R. Chadwick, P.C. |
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; Notwithstanding the forgoing, any increase or decrease in Volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the commission pursuant to Rule 424(b)if, in the aggregate, the changes in the volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the Calculation of Registration Fee table in the effective registration statement. |
|
|
|
|
(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. |
47 | Page
Signatures
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in San Antonio Del Monte, El Salvador, on January 30, 2013.
Vanell, Corp.
By:/s/ Francisco Douglas Magana
Francisco Douglas Magana
President, Chief Executive Officer,
Treasurer, Chief Accounting Officer, Chief Financial Officer, sole Director and Secretary
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates stated.
SIGNATURE |
CAPACITY IN WHICH SIGNED |
DATE |
|
|
|
/s/ Francisco Douglas Magana |
President, Chief Executive |
January 30, 2013 |
|
Officer, Treasurer, |
|
Francisco Douglas Magana |
Chief Accounting Officer, |
|
|
Chief Financial Officer |
|
|
sole Director and Secretary |
|
48 | Page
EXHIBIT INDEX
|
|
||
Exhibit No. |
Document Description |
||
3.1 |
|
Articles of Incorporation |
|
3.2 |
|
By-Laws |
|
5.1 |
|
||
10.1 |
|
Professional Service Agreement with Finca La Esmeralda |
|
23.1 |
|
Consent of Ronald R. Chadwick, P.C. |
49 | Page
Exhibit 3.1
1 | Page
CORPORATE CHARTER
I, ROSS MILLER, the duly elected and qualified Nevada Secretary of State, do hereby certify that VANELL, CORP. , did on September 7, 2012, file in this office the original Articles of Incorporation; that said Articles of Incorporation are now on file and of record in the office of the Secretary of State of the State of Nevada, and further, that said Articles contain all the provisions required by the law of said State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my
hand and affixed the Great Seal of State, at my
office on September 7, 2012.
ROSS MILLER
Secretary of State
Certified By: Electronic Filing
Certificate Number: C20120907-1956
You may verify this certificate
online at http://www.nvsos.gov/
2 | Page
Exhibit 3.1
Bylaws of Vanell, Corp.
Article I
Office
The Board of Directors shall designate and the Corporation shall maintain a principal office. The location of the principal office may be changed by the Board of Directors. The Corporation also may have offices in such other places as the Board may from time to time designate. The location of the initial principal office of the Corporation shall be designated by resolution.
Article II
Shareholders Meetings
1. Annual Meetings
The annual meeting of the shareholders of the Corporation shall be held at such place within or without the State of Nevada as shall be set forth in compliance with these Bylaws. The meeting shall be held on the third Tuesday of September of each year. If such day is a legal holiday, the meeting shall be on the next business day. This meeting shall be for the election of Directors and for the transaction of such other business as may properly come before it.
2. Special Meetings
Special meetings of shareholders, other than those regulated by statute, may be called by the President upon written request of the holders of 50% or more of the outstanding shares entitled to vote at such special meeting. Written notice of such meeting stating the place, the date and hour of the meeting, the purpose or purposes for which it is called, and the name of the person by whom or at whose direction the meeting is called shall be given.
3. Notice of Shareholders Meeting
The Secretary shall give written notice stating the place, day, and hour of the meeting, and in the case of a special meeting, the purpose or purposes for which the meeting is called, which shall be delivered not less than ten or more than fifty days before the date of the meeting, either personally or by mail to each shareholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the shareholder at their address as it appears on the books of the Corporation, with postage thereon prepaid. Attendance at the meeting shall constitute a waiver of notice thereof.
1 | Page
4. Place of Meeting
The Board of Directors may designate any place, either within or without the State of Nevada, as the place of meeting for any annual meeting or for any special meeting called by the Board of Directors. A waiver of notice signed by all shareholders entitled to vote at a meeting may designate any place, either within or without the State of Nevada, as the place for the holding of such meeting. If no designation is made, or if a special meeting is otherwise called, the place of meeting shall be the principal office of the Corporation.
5. Record Date
The Board of Directors may fix a date not less than ten nor more than fifty days prior to any meeting as the record date for the purpose of determining shareholders entitled to notice of and to vote at such meetings of the shareholders. The transfer books may be closed by the Board of Directors for a stated period not to exceed fifty days for the purpose of determining shareholders entitled to receive payment of and dividend, or in order to make a determination of shareholders for any other purpose.
6. Quorum
A majority of the outstanding shares of the Corporation entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders. If less than a majority of the outstanding shares are represented at a meeting, a majority of the shares so represented may adjourn the meeting from time to time without further notice. At a meeting resumed after any such adjournment at which a quorum shall be present or represented, any business may be transacted, which might have been transacted at the meeting as originally noticed.
7. Voting
A holder of outstanding shares, entitled to vote at a meeting, may vote at such meeting in person or by proxy. Except as may otherwise be provided in the currently filed Articles of Incorporation, every shareholder shall be entitled to one vote for each share standing their name on the record of shareholders. Except as herein or in the currently filed Articles of Incorporation otherwise provided, all corporate action shall be determined by a majority of the votes cast at a meeting of shareholders by the holders of shares entitled to vote thereon.
8. Proxies
At all meeting of shareholders, a shareholder may vote in person or by proxy executed in writing by the shareholder or by their duly authorized attorney-in-fact. Such proxy shall be filed with the Secretary of the Corporation before or at the time of the meeting. No proxy shall be valid after six months from the date of its execution.
9. Informal Action by Shareholders
Any action required to be taken at a meeting of the shareholders, may be taken without a meeting if a consent in writing, setting forth the action so taken, shall be signed by a majority of the shareholders entitled to vote with respect to the subject matter thereof.
2 | Page
Article III
Board of Directors
1. General Powers
The business and affairs of the Corporation shall be managed by its Board of Directors. The Board if Directors may adopt such rules and regulations for the conduct of their meetings and the management of the Corporation as they appropriate under the circumstances. The Board shall have authority to authorize changes in the Corporations capital structure.
2. Number, Tenure and Qualification
The number of Directors of the Corporation shall be a number between one and five, as the Directors may by resolution determine from time to time. Each of the Directors shall hold office until the next annual meeting of shareholders and until their successor shall have been elected and qualified.
3. Regular Meetings
A regular meeting of the Board of Directors shall be held without other notice than by this Bylaw, immediately after and, at the same place as the annual meeting of shareholders. The Board of Directors may provide, by resolution, the time and place for the holding of additional regular meetings without other notice than this resolution.
4. Special Meetings
Special meetings of the Board of Directors may be called by order of the Chairman of the Board or the President. The Secretary shall give notice of the time, place and purpose or purposes of each special meeting by mailing the same at least two days before the meeting or by telephone, telegraphing or telecopying the same at least one day before the meeting to each Director. Meeting of the Board of Directors may be held by telephone conference call.
5. Quorum
A majority of the members of the Board of Directors shall constitute a quorum for the transaction of business, but less than a quorum may adjourn any meeting from time to time until a quorum shall be present, whereupon the meeting may be held, as adjourned, without further notice. At any meeting at which every Director shall be present, even though without any formal notice any business may be transacted
6. Manner of Acting
At all meetings of the Board of Directors, each Director shall have one vote. The act of a majority of Directors present at a meeting shall be the act of the full Board of Directors, provided that a quorum is present.
7. Vacancies
A vacancy in the Board of Directors shall be deemed to exist in the case of death, resignation, or removal of any Director, or if the authorized number of Directors is increased, or if the shareholders fail, at any meeting of the shareholders, at which any Director is to be elected, to elect the full authorized number of Directors to be elected at that meeting.
3 | Page
8. Removals
Directors may be removed, at any time, by a vote of the shareholders holding a majority of the shares outstanding and entitled to vote. Such vacancy shall be filled by the Directors entitled to vote. Such vacancy shall be filled by the Directors then in office, though less than a quorum, to hold office until the next annual meeting or until their successor is duly elected and qualified, except that any directorship to be filled by election by the shareholders at the meeting at which the Director is removed. No reduction of the authorized number of Directors shall have the effect of removing any Director prior to the expiration of their term of office.
9. Resignation
A director may resign at any time by delivering written notification thereof to the President or Secretary of the Corporation. A resignation shall become effective upon its acceptance by the Board of Directors; provided, however, that if the Board of Directors has not acted thereon within ten days from the date of its delivery, the resignation shall be deemed accepted.
10. Presumption of Assent
A Director of the Corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action(s) taken unless their dissent shall be placed in the minutes of the meeting or unless he or she shall file their written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or shall forward such dissent by registered mail to the secretary of the Corporation immediately after the adjournment of the meeting. Such right to dissent shall not apply to a Director who voted in favor of such action.
11. Compensation
By resolution of the Board of Directors, the Directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors or a stated salary as Director. No such payment shall preclude any Director from serving the Corporation in any other capacity and receiving compensation therefor.
12. Emergency Power
When, due to a national disaster or death, a majority of the Directors are incapacitated or otherwise unable to attend the meetings and function as Directors, the remaining members of the Board of Directors shall have all the powers necessary to function as a complete Board, and for the purpose of doing business and filling vacancies shall constitute a quorum, until such time as all Directors can attend or vacancies can be filled pursuant to these Bylaws.
13. Chairman
The Board of Directors may elect from its own number a Chairman of the Board, who shall preside at all meetings of the Board of Directors, and shall perform such other duties as may be prescribed from time to time by the Board of Directors. The Chairman may by appointment fill any vacancies on the Board of Directors.
4 | Page
Article IV
Officers
1. Number
The officers of the Corporation shall be a President, one or more Vice Presidents, a Secretary, and a Treasurer, each of whom shall be elected by a majority of the Board of Directors. Such other Officers and assistant Officers as may be deemed necessary may be elected or appointed by the Board of Directors. In its discretion, the Board of Directors may leave unfilled for any such period as it may determine any office except those of President and Secretary. Any two or more offices may be held by the same person. Officers may or may not be Directors or shareholders of the Corporation.
2. Election and Term of Office
The Officers of the Corporation to be elected by the Board of Directors shall be elected annually by the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of the shareholders. If the election of Officers shall not be held at such meeting, such election shall be held as soon thereafter as convenient. Each Officer shall hold office until their successor shall have been duly elected and shall have qualified or until their death or until they shall resign or shall have been removed in the manner hereinafter provided.
3. Resignations
Any Officer may resign at any time by delivering a written resignation either to the President or to the Secretary. Unless otherwise specified therein, such resignation shall take effect upon delivery.
4. Removal
Any Officer or agent may be removed by the Board of Directors whenever in its judgment the best interests Corporation will be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed. Election or appointment of an Officer or agent shall not of itself create contract rights. Any such removal shall require a majority vote of the Board of Directors, exclusive of the Officer in question if he or she is also a Director.
5. Vacancies
A vacancy in any office because of death, resignation, removal, disqualification or otherwise, or is a new office shall be created, may be filled by the Board of Directors for the un-expired portion of the term.
6. President
The president shall be the chief executive and administrative Officer of the Corporation. He or she shall preside at all meetings of the stockholders and, in the absence of the Chairman of the Board, at meetings of the Board of Directors. He or she shall exercise such duties as customarily pertain to the office of President and shall have general and active supervision over the property, business, and affairs of the Corporation and over its several Officers, agents, or employees other than those appointed by the Board of Directors. He or she may sign, execute and deliver in the name of the Corporation powers of attorney, contracts, bonds and other obligations, and shall perform such other duties as may be prescribed from time to time by the Board of Directors or by the Bylaws.
5 | Page
7. Vice President
The Vice President shall have such powers and perform such duties as may be assigned to him by the Board of Directors or the President. In the absence or disability of the President, the Vice President designated by the Board or the President shall perform the duties and exercise the powers of the President. A Vice President may sign and execute contracts any other obligations pertaining to the regular course of their duties.
8. Secretary
The Secretary shall keep the minutes of all meetings of the stockholders and of the Board of Directors and, to the extent ordered by the Board of Directors or the President, the minutes of meeting of all committees. He or she shall cause notice to be given of meetings of stockholders, of the Board of Directors, and of any committee appointed by the Board. He or she shall have custody of the corporate seal and general charge of the records, documents and papers of the Corporation not pertaining to the performance of the duties vested in other Officers, which shall at all reasonable times be open to the examination of any Directors. He or she may sign or execute contracts with the President or a Vice President thereunto authorized in the name of the Corporation and affix the seal of the Corporation thereto. He or she shall perform such other duties as may be prescribed from time to time by the Board of Directors or by the Bylaws.
9. Treasurer
The Treasurer shall have general custody of the collection and disbursement of funds of the Corporation. He or she shall endorse on behalf of the Corporation for collection check, notes and other obligations, and shall deposit the same to the credit of the Corporation in such bank or banks or depositories as the Board of Directors may designate. He or she may sign, with the President or such other persons as may be designated for the purpose of the Board of Directors, all bills of exchange or promissory notes of the Corporation. He or she shall enter or cause to be entered regularly in the books of the Corporation full and accurate account of all monies received and paid by him on account of the Corporation; shall at all reasonable times exhibit his (or her) books and accounts to any Director of the Corporation upon application at the office of the Corporation during business hours; and, whenever required by the Board of Directors or the President, shall render a statement of his (or her) accounts. The Treasurer shall perform such other duties as may be prescribed from time to time by the Board of Directors or by the Bylaws.
10. Other Officers
Other Officers shall perform such duties and shall have such powers as may be assigned to them by the Board of Directors.
11. Salaries
Salaries or other compensation of the Officers of the Corporation shall be fixed from time to time by the Board of Directors, except that the Board of Directors may delegate to any person or group of persons the power to fix the salaries or other compensation of any subordinate Officers or agents. No Officer shall be prevented from receiving any such salary or compensation by reason of the fact the he or she is also a Director of the Corporation
6 | Page
12. Surety Bonds
In case the Board of Directors shall so require, any Officer or agent of the Corporation shall execute to the Corporation a bond in such sums and with such surety or sureties as the Board of Directors may direct, conditioned upon the faithful performance of his (or her) duties to the Corporation, including responsibility for negligence and for the accounting for all property, monies or securities of the Corporation, which may come into his (or her) hands.
Article V
Contracts, Loans, Checks and Deposits
1. Contracts
The Board of Directors may authorize any Officer or Officers, agent or agents, to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Corporation and such authority may be general or confined to specific instances.
2. Loans
No loan or advance shall be contracted on behalf of the Corporation, no negotiable paper or other evidence of its obligation under any loan or advance shall be issued in its name, and no property of the Corporation shall be mortgaged, pledged, hypothecated or transferred as security for the payment of any loan, advance, indebtedness or liability of the Corporation unless and except as authorized by the Board of Directors. Any such authorization may be general or confined to specific instances.
3. Deposits
All funds of the Corporation not otherwise employed shall be deposited from time to time to the credit of the Corporation in such banks, trust companies or other depositories as the Board of Directors may select, or as may be selected by an Officer or agent of the Corporation authorized to do so by the Board of Directors.
4. Checks and Drafts
All notes, drafts, acceptances, checks, endorsements and evidence of indebtedness of the Corporation shall be signed by such Officer or Officers or such agent or agents of the Corporation and in such manner as the Board of Directors from time to time may determine. Endorsements for deposits to the credit of the Corporation in any of its duly authorized depositories shall be made in such manner as the Board of Directors may from time to time determine.
5. Bonds and Debentures
Every bond or debenture issued by the Corporation shall be in the form of an appropriate legal writing, which shall be signed by the President or Vice President and by the Treasurer or by the Secretary, and sealed with the seal of the Corporation. The seal may be facsimile, engraved or printed. Where such bond or debenture is authenticated with the manual signature of an authorized Officer of the Corporation or other trustee designated by the indenture of trust or other agreement under which such security is issued, the signature of any of the Corporations Officers named thereon may be facsimile. In case any Officer who signed, or whose facsimile signature has been used on any such bond or debenture, shall cease to be an Officer of the Corporation for any reason before the same has been delivered by the Corporation, such bond or debenture may nevertheless by adopted by the Corporation and issued and delivered as though the person who signed it or whose facsimile signature has been used thereon had not ceased to be such Officer.
7 | Page
Article VI
Capital Stock
1. Certificate of Share
The shares of the Corporation shall be represented by certificates prepared by the Board of Directors and signed by the President. The signatures of such Officers upon a certificate may be facsimiles if the certificate is countersigned by a transfer agent or registered by a registrar other than the Corporation itself or one of its employees. All certificates for shares shall be consecutively numbered or otherwise identified. The name and address of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the stock transfer books of the Corporation. All certificates surrendered to the Corporation for transfer shall be canceled except that in case of a lost, destroyed or mutilated certificate, a new one may be issued therefor upon such terms and indemnity to the Corporation as the Board of Directors may prescribe.
2. Transfer of Shares
Transfer of shares of the Corporation shall be made only on the stock transfer books of the Corporation by the holder of record thereof or by his (or her) legal representative, who shall furnish proper evidence of authority to transfer, or by his (or her) attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the Corporation, and on surrender for cancellation of the certificate for such shares. The person in whose name shares stand on the books of the Corporation shall be deemed by the Corporation to be the owner thereof for all purposes.
3. Transfer Agent and Registrar
The Board of Directors of the Corporation shall have the power to appoint one or more transfer agents and registrars for the transfer and registration of certificates of stock of any class, and may require that stock certificates shall be countersigned and registered by one or more of such transfer agents and registrars.
4. Lost or Destroyed Certificates
The Corporation may issue a new certificate to replace any certificate theretofore issued by it alleged to have been lost or destroyed. The Board of Directors may require the owner of such a certificate or his (or her) legal representative to give the Corporation a bond in such sum and with such sureties as the Board of Directors may direct to indemnify the Corporation as transfer agents and registrars, if any, against claims that may be made on account of the issuance of such new certificates. A new certificate may be issued without requiring any bond.
5. Registered Shareholders
The Corporation shall be entitled to treat the holder of record of any share or shares of stock as the holder thereof, in fact, and shall not be bound to recognize any equitable or other claim to or on behalf of this Corporation to any and all of the rights and powers incident to the ownership of such stock at any such meeting, and shall have power and authority to execute and deliver proxies and consents on behalf of this Corporation in connection with the exercise by this Corporation of the rights and powers incident to the ownership of such stock. The Board of Directors, from time to time, may confer like powers upon any other person or persons.
8 | Page
Article VII
Indemnification
No Officer or Director shall be personally liable for any obligations of the Corporation or for any duties or obligations arising out of any acts or conduct of said Officer or Director performed for or on behalf of the Corporation. The Corporation shall and does hereby indemnify and hold harmless each person and their heirs and administrators who shall serve at any time hereafter as a Director or Officer of the Corporation from and against any and all claims, judgments and liabilities to which such persons shall become subject by reason of their having heretofore or hereafter been a Director or Officer of the Corporation, or by reason of any action alleged to have heretofore or hereafter taken or omitted to have been taken by him as such Director or Officer, and shall reimburse each such person for all legal and other expenses reasonably incurred by him in connection with any such claim or liability, including power to defend such persons from all suits or claims as provided for under the provisions of the Nevada Revised Statutes; provided, however, that no such persons shall be indemnified against, or be reimbursed for, any expense incurred in connection with any claim or liability arising out of his (or her) own negligence or willful misconduct. The rights accruing to any person under the foregoing provisions of this section shall not exclude any other right to which he or she may lawfully be entitled, nor shall anything herein contained restrict the right of the Corporation to indemnify or reimburse such person in any proper case, even though not specifically herein provided for. The Corporation, its Directors, Officers, employees and agents shall be fully protected in taking any action or making any payment, or in refusing so to do in reliance upon the advice of counsel.
Article VIII
Notice
Whenever any notice is required to be given to any shareholder or Director of the Corporation under the provisions of the Articles of Incorporation, or under the provisions of the Nevada Statutes, a waiver thereof in writing signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. Attendance at any meeting shall constitute a waiver of notice of such meetings, except where attendance is for the express purpose of objecting to the holding of that meeting.
Article IX
Amendments
These Bylaws may be altered, amended, repealed, or new Bylaws adopted by a majority of the entire Board of Directors at any regular or special meeting. Any Bylaw adopted by the Board may be repealed or changed by the action of the shareholders.
Article X
Fiscal Year
The fiscal year of the Corporation shall be fixed and may be varied by resolution of the Board of Directors.
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Article XI
Dividends
The Board of Directors may at any regular or special meeting, as they deem advisable, declare dividends payable out of the surplus of the Corporation.
Article XII
Corporate Seal
The seal of the Corporation shall be in the form of a circle and shall bear the name of the Corporation and the year of incorporation per sample affixed hereto.
CERTIFIED TO BE THE BYLAWS OF:
Vanell, Corp.
/S/ Francisco Douglas Magana
President
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Exhibit 5.1
Stepp Law Corporation
15707 Rockfield Blvd.
Suite 101
Irvine, California 92618
January 28, 2013
Vanell, Corp.
Res. San Antonio Bk 10, Pje 7 N5
San Antonio Del Monte, Sonsonate
El Salvador SV-106090030
Attention: Francisco D. Magana,
Re: Registration Statement on Form S-1
Dear Mr. Magana:
As special counsel to Vanell, Corp., a Nevada corporation (the "Company"), we have been requested to provide our opinion regarding 880,000 shares of the Companys common stock which have been issued by the Company (the Shares). We have been informed that the Shares will be registered for sale or transfer by the holders thereof pursuant to the provisions of that certain registration statement on Form S-1, which is anticipated to be filed by the Company with the Securities and Exchange Commission (the Commission"), to comply with the applicable provisions of the Securities Act of 1933, as amended (the Act), and those holders are identified in that registration statement (the "Registration Statement"). Accordingly, the purpose of this letter is to respond, in writing, to that request and furnish that opinion. The opinion specified in this letter is limited to Nevada law.
For purposes of providing the opinion specified in this letter, we have made such legal and factual examinations and inquiries, including an examination of photocopies, identified to our satisfaction being true copies of various records of the Company, including the Registration Statement and such other documents, instruments, corporate records and public records as we have deemed necessary or appropriate. Also, we have obtained from officers of the Company, and have relied upon, such certificates, representations and assurances as we deem necessary or appropriate for the purposes of providing that opinion.
Without limiting the generality of the foregoing, we have, with your permission, assumed without independent verification that (i) each natural person executing a document has sufficient legal capacity to do so; (ii) all documents submitted to us as originals are authentic, the signatures on all documents that we have examined are genuine and all documents submitted to us as photocopies, electronic or facsimile copies conform to the original document; and (iii) all records made available to us by the Company and all public records we have reviewed are accurate and complete.
Based on the foregoing and in reliance thereon and subject to the qualifications, limitations, exceptions and assumptions specified in this letter, it is our opinion that the Shares (i) have been duly and validly authorized for issuance and (ii) are validly issued, fully paid, and non-assessable.
The opinion specified in this letter is as of the date of this letter, and we assume no obligation to update or supplement that opinion, if any applicable law changes after the date of this letter or if we become aware after the date of this letter of any fact, whether existing before or occurring after the date of this letter, that might change the opinion specified in this letter.
We confirm that we furnish no opinion with respect to the truth and accuracy or the completeness of the Registration Statement. The opinion specified in this letter is expressly limited to the matters specified in this letter, and we furnish no opinion, express or implied, as to any other matter relating to the Company or its securities. Accordingly, no provision of this letter is intended to be, nor shall any such provision be construed as, an opinion concerning any matter not specified in this letter.
We consent to the (i) use of this letter as an exhibit to the Registration Statement, (ii) disclosure in the prospectus portion of the Registration Statement of the opinion specified in this letter, and (iii) use of our name in the Registration Statement. In giving the foregoing consent, we do not hereby admit that we are in the category of persons whose consent is required pursuant to Section 7 of the Act, or the rules and regulations of the Commission.
The Company is hereby advised, urged, and encouraged to consult with and, if appropriate, retain securities counsel in each jurisdiction outside the United States in which the Shares may be offered and sold regarding compliance with the securities laws of such jurisdiction.
Finally, of course, in the event that you have questions or comments regarding this matter, please do not hesitate to contact us. Thank you.
Sincerely,
STEPP LAW CORPORATION
/s/ Thomas E. Stepp, Jr.
By: Thomas E. Stepp, Jr.
TES/jjb
Exhibit 10.1
PROFESSIONAL SERVICES CONSULTING AGREEMENT
THIS AGREEMENT , effective as of the date of the last signatory hereto (the Effective Date), is by and between (Client) Finca La Esmeralda , located at Salcoatitan, Sonsonate, El Salvador and ("Consultant"), Vanell, Corp. , located at Res. San Antonio Bk 10, Pje 7 N5 San Antonio Del Monte, Sonsonate, El Salvador.
NOW, THEREFORE, in consideration of the mutual promises and covenants herein contained, the parties hereto agree to the following:
1. Services: During the term of this Agreement, Consultant will provide consultation, guidance and technical assistance to CLIENT as outlined in the Scope of Work attached hereto as Exhibit A , which is incorporated by reference as if set forth at length herein. At the sole discretion of CLIENT, this Scope of Work may be reasonably modified, reduced or expanded.
2. Term of Agreement/Termination : The term of this Agreement shall be for 12 months beginning from the Effective Date, unless terminated earlier as provided herein. CLIENT may terminate this Agreement for any reason upon twenty (20) days advance written notice to Consultant. Consultant may terminate this Agreement in the event that CLIENT commits a breach of its material obligations hereunder, upon twenty (20) days advance written notice and where CLIENT does not cure the breach.
3. Payment: The CLIENT will pay to Consultant $85.00 per hour for services rendered to the CLIENT under this Agreement. CLIENT should be invoiced for consulting fees in an amount not to exceed $2,500 per month. Invoicing should be on a monthly basis, beginning after the Consultant has completed his first four (4) weeks of service. Under no circumstances shall Consultant perform work having a value (based on the agreed upon per hour rate) in excess of the maximum permitted fee. Consultant shall have discretion in selecting the dates and times it performs consulting services throughout the month giving due regard to the needs of the CLIENTs business. Payment by CLIENT is due within thirty (30) days from receipt of an approved invoice. The CLIENT agrees to reimburse Consultant for all actual reasonable and necessary expenditures, which are directly related to the consulting services. These expenditures include, but are not limited to, expenses related to travel (i.e. airfare, hotel, temporary housing, meals, parking, mileage, etc.), telephone calls, and postal expenditure. Expenses incurred by Consultant will be reimbursed by the CLIENT within 15 days of Consultants proper written request for reimbursement.
4. Invoices/Reporting : All invoices submitted to CLIENT by Consultant for payment must include a written, task based report detailing the services actually and reasonably provided by Consultant to CLIENT along with the time spent by Consultant performing the same. Consultant shall certify in writing that each such invoice is complete and accurate. Payment is contingent on provision of such invoices. Consultant shall provide technical reports in accordance with the Scope of Work attached as Exhibit A.
5. Assignment: CLIENT has retained Consultant based, in part, upon his qualification to perform the Work. Consultant shall not assign his rights or obligations hereunder without the prior written consent of CLIENT. Neither shall he subcontract, either directly or indirectly, any of his responsibilities hereunder without the prior written consent of CLIENT.
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6. Conflicts Of Interest : Consultant represents that there are no conflicts of interest, as defined by CLIENT policy concerning the same, between services to be rendered under this Agreement and Consultant's services and employment with other parties. If, during the course of this Agreement, Consultant becomes aware of facts which constitute or may give rise to a conflict of interest, Consultant shall immediately advise CLIENT, so that it may determine appropriate procedures for managing the same.
7. Relationship of Parties: The CLIENT and Consultant are independent contractors. Both parties acknowledge and agree that Consultant's engagement hereunder is not exclusive and that either party may provide to, or retain from, others similar such services provided that it does so in a manner that does not otherwise breach this Agreement. Neither party is, nor shall claim to be, a legal agent, representative, partner or employee of the other, and neither shall have the right or authority to contract in the name of the other nor shall it assume or create any obligations, debts, accounts or liabilities for the other.
8. Confidential Information and Intellectual Property:
(a) Consultant shall maintain in strict confidence, and not use or disclose except pursuant to written instructions from the CLIENT, any Trade Secret (as defined below) of the CLIENT, for so long as the pertinent data or information remains a Trade Secret, provided that the obligation to protect the confidentiality of any such information or data shall not be excused if such information or data ceases to qualify as a Trade Secret as a result of the acts or omissions of Consultant.
(b) Consultant shall maintain in strict confidence and, except as necessary to perform his duties hereunder, not to use or disclose any Confidential Business Information (as hereinafter defined) during the term of this Agreement and for a period of one (1) year thereafter.
(c) Consultant may disclose Trade Secrets or Confidential Business Information pursuant to any order or legal process requiring the disclosing party (in its legal counsel's reasonable opinion) to do so, provided that the request or order to so disclose the Trade Secrets or Confidential Business Information in sufficient time to allow the CLIENT to seek an appropriate protective order.
(a) "Trade Secret" shall mean any information, including, but not limited to, technical or non-technical data, a formula, a pattern, a compilation, a program, a plan, a device, a method, a technique, a process, financial data, financial plans, product plans, or a list of actual or potential customers or suppliers which (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy. "Confidential Business Information" shall mean any nonpublic information of a competitively sensitive or personal nature, other than Trade Secrets, acquired by Consultant in connection with performing services for the CLIENT, including (without limitation) oral and written information concerning the CLIENT's financial positions and results of operations (revenues, margins, assets, net income, etc.)), annual and long-range business plans, marketing plans and methods, account invoices, oral or written customer information, and personnel information. (b) All original works of authorship that result from the performance by Consultant of his duties hereunder, are deemed to be "works made for hire" under the copyright laws of the Republic of Poland, and will be and will remain the sole and exclusive property of the CLIENT. Consultant, at the CLIENT's request and sole expense, will assign to the CLIENT in perpetuity all proprietary rights that he may have in such works of authorship. Such assignment shall be done by documents as prepared by the CLIENT. Should the CLIENT elect to register claims of copyright to any such works of authorship, Consultant will, at the expense of the CLIENT, do such things, sign such documents and provide such reasonable cooperation as is necessary for the CLIENT to register such claims, and obtain, protect, defend and enforce such proprietary rights. Consultant shall have no right to use any trademarks or proprietary marks of the CLIENT without the express, prior written consent of the CLIENT regarding each use.
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i. In the event Consultant shall violate or threaten to violate the provisions of this Section, damages at law will be an insufficient remedy and the CLIENT shall be entitled to equitable relief including but not limited to injunction, monetary damages, punitive damages, and specific liquidated damages for disclosure of confidential information and use of such information to solicit CLIENT's customers. In addition, other remedies or rights available to the CLIENT and no bond or security will be required in connection with such equitable relief.
ii. The existence of any claim or cause of action that Consultant may have against the CLIENT will not at any time constitute a defense to the enforcement by the CLIENT of the restrictions or rights provided by this Section, but the failure to assert such claim or cause of action shall not be deemed to be a waiver of such claim or cause of action.
9. General Provisions:
(a) The failure by either party to enforce any provision of this Agreement or to timely insist on performance shall not constitute or be construed as a waiver of any right to strictly enforce a contractual provision.
(b) Except as set forth in the Scope of Work attached as Exhibit A , Consultant warrants that its performance of this Agreement does not depend on the acquisition of rights from any third party and the conveyance of the deliverables described in the Scope of Work attached as Exhibit A will not knowingly infringe on the intellectual property rights of any third party.
(c) Any notice provided for in this Agreement shall be in writing and deemed to have been received if sent by certified mail, postage pre-paid.
(d) The provisions of this Agreement shall be governed by the laws of Poland, and the parties agree that any disputes resulting from or related to this Agreement are to be settled by the Court of Arbitration at the Polish Chamber of Commerce in Warsaw pursuant to the Rules of this Court.
(e) This Agreement constitutes the entire understanding between the parties regarding this matter and merges any and all prior discussions, representations, promises, and warranties within its scope. There are no representations, warranties or promises not expressly set forth in this Agreement. Except as expressly set forth herein, this Agreement may not be modified, renewed, or extended, except in writing, signed by both parties.
IN WITNESS WHEREOF, the parties hereunder have executed this Agreement on November 26, 2012.
CLIENT:
Finca La Esmeralda
Salcoatitan, Sonsonate,
El Salvador
By: /s/ Emilio George Diaz Lopez
---------------------------------
Title: Manager
---------------------------------
Date: November 26, 2012
---------------------------------
CONSULTANT:
Vanell, Corp.
Res. San Antonio Bk 10, Pje 7 N5
San Antonio Del Monte,
Sonsonate, El Salvador
By: /s/ Francisco Douglas Magana
---------------------------------
Title: Director
---------------------------------
Date: November 26, 2012
---------------------------------
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E X H I B I T A
Scope of Work
Vanell, Corp. (Consultant) has been contracted by Finca La Esmeralda (CLIENT) to provide consulting service in commercial cultivation and processing of coffee (Product). Consultants specific areas of services include but are not limited to the following:
CLIENTs existing cultivation facilities:
1. Review of the current cultivation process used by CLIENT.
2. Prepare a written recommendation for improvement of harvesting methods that are appropriate for existing facility. Special consideration should be given to the selection of the right seed for plantation conditions, rational harvesting, coffee quality, dissolved and injected fertilization and farm mechanization. After approval of any recommendations by CLIENT provide necessarily instructing and training of staff (if required).
3. Review of the harvesting methods, processing, packaging and storing of the product.
4. Review of the pest management, especially of berry borers, nematodes, and leaf rust fungus (Hemileia vastatix Berk. And Br.).
5. Prepare a written recommendation for improvement of harvesting, processing, packaging and storing of the product.
6. After the revision of contracts with product distributors prepare a written recommendation regarding marketing strategies, new distributors networks and logistic solutions.
On-Call service:
1. Give verbal or written recommendations or instructions via phone, mail or email regarding any CLIENTs questions that are not mentioned above, but are related to commercial cultivation and processing of coffee.
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Exhibit 23.1
Ronald R. Chadwick, P.C.
Certified Public Accountant
2851 South Parker Road
Suite 720
Aurora, Colorado 80014
Phone (303)306-1967
Fax (303)306-1944
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
I consent to the use in the Registration Statement of Vanell, Corp. on Form S-1 of my Report of Independent Registered Public Accounting Firm, dated January 16, 2013 on the balance sheet of Vanell, Corp. as at December 31, 2012, and the related statements of operations, stockholders' equity, and cash flows for the period from September 7, 2012 (date of inception) through December 31, 2012.
In addition, I consent to the reference to me under the heading Experts in the Registration Statement.
RONALD R. CHADWICK, P.C.
Ronald R. Chadwick, P.C.
Aurora, Colorado
January 28, 2013