SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-12
MOUNTAINS WEST EXPLORATION, INC.
---------------------------------------
(Name of Registrant as Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14c-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
MOUNTAINS WEST EXPLORATION, INC.
P.O. Box 754
Trinidad, Colorado 81802
719-846-2623
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
October __, 2004
Dear Shareholder:
We cordially invite you to attend Mountains West Exploration, Inc.'s Annual
Meeting of Shareholders at _______ P.M. on _____________, November ___, 2004, at
The Sheraton Hotel, 360 Union Blvd., Lakewood, Colorado at which meeting you may
be present. If you choose not to attend, you may send your ballot appointing
Robert A. Doak, Jr., President, to vote as your ballot directs. The Notice of
Meeting and the accompanying Proxy describe the business of the Annual Meeting
of Shareholders.
The enclosed Proxy statement is being furnished to shareholders of record
on October __, 2004 of Mountains West Exploration, Inc. ("MWEI"), a New Mexico
corporation, in connection with the following proposals.
YOU ARE NOT REQUIRED TO SEND US A PROXY BUT YOUR PROXY IS REQUESTED
The holders of a majority of the issued and outstanding shares entitled to
vote have indicated that they intend to vote in favor of these proposals.
1. To authorize the Board of Directors to sell all of the gas and mineral
assets of the Company for the best price obtainable.
2. To elect two directors to hold office until the next annual meeting of
shareholders and qualification of their respective successors.
3. To ratify the appointment of Michael Johnson & Co. as Independent
Accountants for the annual period ending December 31, 2004.
4. To change the Company's name to a name to be determined by the Board
of Directors.
5. To authorize a reverse split of the Company's common stock on a basis
of up to one for fifty. Fractional shares will be rounded up to the
next whole share.
The Board of Directors has fixed the closing of business on October __,
2004, as the record date for the determination of shareholders entitled to
notice of and to vote at this meeting or any adjournment thereof. The stock
transfer books will not be closed.
The Company's Annual Report to Stockholders for the year ended December 31,
2003 accompanies this Notice of Annual Meeting and Proxy Statement.
All stockholders, whether or not they expect to attend the Meeting in
person, are requested either to complete, date, sign, and return the enclosed
form of proxy in the accompanying envelope or to record their proxy by other
authorized means. The proxy may be revoked by the person executing the proxy by
filing with the Secretary of the Company an instrument of revocation or duly
executed proxy bearing a later date, or by electing to vote in person at the
meeting.
Sincerely,
/s/Robert A. Doak, Jr.
------------------------------
Robert A. Doak, Jr.,
President and Treasurer
-----------
WE ARE ASKING YOU FOR A PROXY AND YOU ARE REQUESTED TO SEND US A PROXY.
-----------
2
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND RULE 14A PROMULGATED THERETO
MOUNTAINS WEST EXPLORATION, INC.
ANNUAL MEETING OF SHAREHOLDERS
November ___, 2004
This Proxy Statement is being furnished to Shareholders of Mountains West
Exploration, Inc. ("MWEI") in connection with the Annual Meeting of Shareholders
(the "Meeting") to be held on ______________, November __, 2004 and at any
adjournments thereof (the "Meeting"). The Meeting will be held at The Sheraton
Hotel, 360 Union Blvd., Lakewood, Colorado, at ____ P.M. local time.
This Proxy Statement is first being mailed or given to Shareholders on or
about November __, 2004.
We are a New Mexico corporation. We are a full-reporting 1934 Act company,
with our common stock quoted on the Over the Counter Bulletin Board (OTCBB)
under the symbol MWEX.OB. Information about us can be found in our December 31,
2003 Annual Report filed on Form 10-KSB. Additional information about us can be
found in our public filings that can be accessed electronically by means of the
SEC's home page on the Internet at http://www.sec.gov, or at other Internet
sites such as http://www.freeedgar.com, as well as by such other means from the
offices of the SEC.
WE ARE ASKING YOU FOR A PROXY
YOU ARE REQUESTED TO SEND US A PROXY
We are soliciting proxies but the holders of more than 50% percent of the
shares entitled to vote have indicated that they intend to vote in favor of
these proposals. In light of the size of the holdings of these shareholders, the
current Board and management of the Company deems the likelihood of a favorable
vote on the proposals sufficient. You may mark and send the proxy attached
hereto to record your vote.
COSTS OF PROXY STATEMENT
We will pay the cost of preparing and sending out this proxy statement. It
will be sent to most shareholders via regular mail. A few will receive it by
personal delivery or facsimile.
VOTING
SHAREHOLDERS ENTITLED TO VOTE
Holders of record of common stock, at the close of business on the date of
mailing this proxy statement will be entitled to vote at the Annual Meeting. As
of May 31, 2004, 37,019,271 shares of common stock were issued and outstanding.
Each shareholder is entitled to one vote for each share of common stock held by
such shareholder. We have only the single class of stock, namely our common
stock. Each share of Common Stock is entitled to one (1) vote for as many
separate nominees as there are directors to be elected and for or against all
other matters presented. For action to be taken at the Annual Meeting, a
majority of the shares entitled to vote must be represented at the Annual
Meeting in person or by proxy. Shares of stock may not be voted cumulatively.
Abstentions and broker non-votes each will be included in determining the number
of shares present and voting at the Annual Meeting. Abstentions will be counted
in tabulations of the votes cast on proposals, whereas broker non-votes will not
be counted for purposes of determining whether a proposal has been approved.
3
QUORUM AND VOTE NECESSARY FOR APPROVALS.
A majority of the shares of common stock outstanding at the record date
must be represented at the Annual Meeting in person or by proxy in order for a
quorum to be present and in order to take action upon all matters to be voted
upon, but if a quorum should not be present, the meeting may be adjourned
without further notice to shareholders, until a quorum is assembled. Each
shareholder will be entitled to cast one vote at the Annual Meeting for each
share of common stock registered in such shareholder's name at the record date.
Abstentions and broker non-votes are counted for purposes of determining
the presence or absence of a quorum for the transaction of business. Each share
of Common Stock entitles the holder thereof to one vote on all matters to come
before the Annual Meeting. Holders of shares of Common Stock are not entitled to
cumulative voting rights.
The favorable vote of a plurality of the votes of the shares of Common
Stock present in person or represented by proxy at the Annual Meeting is
necessary to elect the nominees for directors of the Company. To take the other
actions at the meeting a majority of the shares outstanding must vote in favor
of the proposals present in person or by Proxy.
A majority of shares issued and outstanding is sufficient to approve the
proposal for a reverse split and name change to be incorporated in Amendments to
the Articles of Incorporation.
PROXIES
In voting their Common Stock, stockholders may vote in favor of or against
the proposal to approve the proposals on the agenda or may abstain from voting.
Stockholders should specify their choice on the accompanying proxy card. All
properly executed proxy cards delivered pursuant to this solicitation and not
revoked will be voted at the Meeting in accordance with the directions given. If
no specific instruction are given with regard to the matter to be voted upon,
then the shares represented by a signed proxy card will be voted "FOR" the
approval of the Proposals and in the discretion of such proxies to any other
procedural matters which may properly come before the Meeting or any
adjournments thereof. All proxies delivered pursuant to this solicitation are
revocable at any time before they are voted at the option of the persons
executing them by (i) giving written notice to the Secretary of the Company,
(ii) by delivering a later dated proxy card, or (iii) by voting in person at the
Meeting. All written notices of revocation and other communications with respect
to revocations of proxies should be addressed to David G. Shier, Secretary,
Mountains West Exploration, Inc., P.O. Box 754, Trinidad, Colorado 81802.
IF THEY WISH TO VOTE, HOLDERS OF COMMON STOCK ARE REQUIRED TO COMPLETE,
DATE, AND SIGN THE ACCOMPANYING PROXY CARD AND RETURN IT PROMPTLY TO THE COMPANY
IN THE ACCOMPANYING ENVELOPE.
The person named as proxy is Robert A. Doak, Jr., President of the Company.
In addition to the solicitation of proxies by mail, the Company, through
its directors, officers, and employees, may solicit proxies from stockholders
personally or by telephone or other forms of communication. The Company will not
reimburse anyone for out-of-pocket costs and expenses incurred in the
solicitation of proxies. The Company also will request brokerage houses,
nominees, fiduciaries, and other custodians to forward soliciting materials to
beneficial owners, and the Company will reimburse such persons for their
reasonable expenses incurred in doing so. All expenses incurred in connection
with the solicitation of proxies will be borne by the Company.
INTEREST OF PERSONS IN MATTERS TO BE ACTED UPON
No officer or director or principal shareholder has a substantial or
material interest in the favorable action on these proposals.
4
PROPOSAL #1
The Company is seeking shareholder approval to sell all of the gas and
mineral assets of the Company for the best price obtainable and to distribute
the net cash proceeds pro rata to shareholders. The Company has fractional
minority working interests in gas wells and undeveloped leaseholds as follows:
WELL NAME %INTEREST NET WELLS GROSS ACRES NET ACRES
- --------- --------- --------- ----------- ---------
Ozzello (one) 12.5% 12.5% 160 20
Jacks (one) 6.25% 6.25% 80 5
Nicol (four units)
(see * below) 3.5% 14% 640 22.4
TOTAL 32.75% 880 47.4
* Nicol Lease 640 acres 4 drill units because of irregular shape 7 wells were
drilled.
Bumble Bee 0.875% interest
Colorow 1.762375%
Donohue 0.59314%
Ellen 3.5%
Jerry 1.75%
News Radio 2.6%
Roseanne 3.5%
The Company, in the past, has not received enough income to a) maintain any
operations or to b) pay the increasing costs of being a reporting company
(estimated at $35,000 to $50,000 this year) or c) pay officers salaries.
In 2004, due to gas price increases the revenue has increased to an average
of about $10,000 per month. This will be eroded by accounting and legal costs,
officers salary, and other costs of being a public company to the point that
only minimum net income will remain on an annualized basis.
These assets are somewhat impaired as to value because they are very small
incremental royalty or working interests, subject to operators discretions.
Other Leases of 4,000 acres are unexplored wildcat prospects in New Mexico.
Management believes that a sale of the assets at todays gas prices will
generate the best price available, and that the net proceeds could then be
distributed, pro rata, to shareholders as a dividend. Management estimates that
after payment of approximately $100,000 in debt, and any other incidental
expenses, the distributable net proceeds would be approximately $100,000 to
$125,000.
After sale of these assets, the Company will not have any activities and
will search for an acquisition.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" SALE OF GAS AND MINERAL ASSETS.
------------------------
PROPOSAL #2
NOMINATION AND ELECTION OF DIRECTORS
The Company's Bylaws currently provide for the number of directors of the
Company to be established by resolution of the Board of Directors and that
number is two. The Board has nominated two (2) persons. At this Annual Meeting,
a Board of two (2) directors will be elected. Except as set forth below, unless
otherwise instructed, the proxy holders will vote the proxies received by them
for Management's nominees named below.
All the nominees are presently directors of the Company. In the event that
any Management nominee shall become available, or if other persons are
nominated, the proxy holders will vote in their discretion for a substitute
nominee. It is not expected that any nominee will be unavailable. The term of
office of each person elected as a director will continue until the next Annual
Meeting of Stockholders or until a successor has been elected and qualified.
The proxies solicited hereby cannot be voted for a number of persons
greater than the number of nominees named below. The Certificate of
Incorporation of the Company does not permit cumulative voting. A plurality of
the votes of the holders of the outstanding shares of Common Stock represented
at a meeting at which a quorum is presented may elect directors.
5
THE DIRECTORS CANDIDATES NOMINATED BY MANAGEMENT ARE:
Robert A. Doak, Jr.
David G. Shier
The above individuals are nominees for election as directors for the next
fiscal year. Their biographical information is as follows:
ROBERT A. DOAK, JR., was an organizer of the Company and became a director
of the Company at its organizational meeting in 1979. He has served as the
President and a Director of the Company since 1979. Prior to becoming employed
by the Company, Mr. Doak was self-employed as a consulting geologist in
Trinidad, Colorado and Santa Fe, New Mexico from 1969 to 1979.
DAVID G. SHIER, became a Company director and the Company's Vice President
and Secretary in 1981 and has held those positions continuously since that time.
Mr. Shier has been self-employed in real estate sales and real estate
investments in Trinidad, Colorado from 1977 to present; executive Vice President
of Trinidad National Bank from 1974 to 1977.
Management will devote part time to the operations of the Company, and any
time spent will be devoted to screening and assessing and, if warranted,
negotiating to acquire business opportunities.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" MANAGEMENT'S NOMINEES.
------------------------
PROPOSAL #3
INDEPENDENT PUBLIC ACCOUNTANTS
Michael Johnson & Co., LLC, Independent Public Accountants, of Denver,
Colorado have been appointed as the Certifying accountants for the period
through fiscal year 2004 and shareholders are asked to ratify such appointment.
Ratification of the appointment of Michael Johnson & Co., LLC, as the Company's
independent public accountants for the fiscal year ending December 31, 2004 will
require the affirmative vote of a majority of the shares of Common Stock
represented in person or by proxy and entitled to vote at the Annual Meeting. In
the event the stockholders do not ratify the appointment of Michael Johnson &
Co., LLC, for the forthcoming fiscal year, such appointment will be reconsidered
by the Board. Representatives of Michael Johnson & Co., LLC, are expected to be
present at the Annual Meeting to make statements if they desires to do so, and
such representatives are expected to be available to respond to appropriate
questions.
Unless marked to the contrary, proxies received will be voted "FOR"
ratification of the appointment of Michael Johnson & Co., LLC, as independent
accountants for the Company's year ending December 31, 2004.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" RATIFICATION OF THE
COMPANY'S INDEPENDENT ACCOUNTANTS.
------------------------
6
Proposal #4
PROPOSED AMENDMENTS TO ARTICLES OF INCORPORATION AND
CHANGES IN CORPORATE CAPITALIZATION
NAME CHANGE
We are asking shareholders to authorize a change in the name of this
corporation to a new name in the discretion of the Board of Directors. This
requires an amendment to our Articles of Incorporation.
We believe that the name change in our Articles of Incorporation are in the
best interest of our corporation, to create a name which is not related to a
defunct business attempt in minerals area.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE NAME CHANGE.
------------------------
Proposal #5
PROPOSED REVERSE SPLIT OF COMMON STOCK ISSUED AND OUTSTANDING
We are asking shareholders to approve a pro-rata reverse split of our
common stock, by which up to each fifty shares would become one share.
Fractional shares will be rounded up to the next whole share. The effective date
of the reverse split will be thirty days following the date of the meeting. This
is not a "going private" transaction, and no shareholders will be reduced to
less than one share. This action will not have the effect of reducing our
shareholders to less than 300.
We believe the recent per share price of the common stock has had a
negative effect on the marketability of the existing shares, the amount and
percentage of transaction costs paid by individual stockholders, and impairs the
potential ability of the Company to raise capital by issuing new shares because
we are very near our maximum authorization.
We believe that reverse split will be advantageous to us and to all
shareholders, because it may provide the opportunity for higher share prices
based upon fewer shares. It is also a factor that most brokerage houses do not
permit or favor lower-priced stocks to be used as collateral for margin
accounts. Certain polices and practices of the securities industry may tent to
discourage individual brokers within those firms from dealing in lower-priced
stocks. Some of those polices and practices involve time-consuming procedures
that make the handling of lower priced stocks economically unattractive. The
brokerage commissions on the purchase or sale of lower priced stocks may also
represent a higher percentage of the price than the brokerage commission on
higher priced stocks.
As a general rule, potential investors who might consider making
investments in our company will refuse to do so when the company has a large
number of shares issued and outstanding with no equity. In other words, the
"dilution" which new investors would suffer would discourage them from
investing, as general rule of experience. A reduction in the total outstanding
shares may, without any assurance, make our capitalization structure more
attractive.
7
While our acceptability for ultimate listing on one of the NASDAQ markets
or an exchange is presently remote, we believe that it is in the interests of
our company to adjust our capital structure in the direction of conformity with
the NASDAQ structural requirements. At the current date, even with the proposed
changes we would not meet NASDAQ criteria. NASDAQ requirements change
constantly. There is no assurance that the proposed changes with meet NASDAQ
requirements or any other exchange when, and if, we are otherwise qualified.
There is no assurance that we will qualify for NASDAQ.
Once the reverse split has occurred, the Company may then be better
structured to seek equity financing, because investors shy away from the very
high dilution which would occur if an investment were made in the current
structure.
TABLE SHOWING EFFECT OF REVERSE SPLIT ONE FOR FIFTY
Shares Pre-Reverse Post-Reverse shares
- --------------------------------------------------------------------------------
100 2
200 4
300 6
400 8
500 10
1000 20
2000 40
3000 60
4000 80
5000 100
10,000 200
20,000 400
50,000 1,000
100,000 2,000
There is no assurance that any effect of the price of our stock will
result, or that the market price for our common stock, immediately or shortly
after the proposed changes, if approved, will rise, or that any rise which may
occur will be sustained. Market conditions obey their own changes in investor
attitudes and external conditions. We are proposing the steps we deem the best
calculation to meet the market attractively, however we cannot control the
markets reaction.
Dissenting shareholders have no appraisal rights under New Mexico law or
pursuant to our constituent documents of incorporation or bylaws, in connection
with the proposed reverse split.
Fractional Shares. Fractional shares will be rounded up to the next whole
share.
The reverse stock split may leave certain stockholders with one or more
"odd lots" of new common stock, i.e., stock in amounts of less than 100 shares.
These odd lots may be more difficult to sell or require greater transaction cost
per share to sell than shares in even multiples of 100. There are frequently
situations where transaction costs for odd lots in penny stocks exceed the net
proceeds realized from a sale of the odd lot, effectively rendering the odd lot
valueless to the holder.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE REVERSE SPLIT
8
ANNUAL MEETING OF SHAREHOLDERS
At the date of this proxy statement, no other matter will presented for
action at the Annual meeting. Only those matters proposed as discussed will be
voted on at the meeting. Shareholders may propose matters to be presented at
shareholder meetings and also nominate directors. Shareholder proposals must
conform to the standards set out by the Securities Exchange Commission and must
be received at our principal offices on or before, ______________, 2005, in
order to be included in future proxy materials, if any, or presentation at our
next annual meeting of shareholders, anticipated in early _______________, 2005.
VOTING SECURITIES AND BENEFICIAL OWNERSHIP
As of the call date of the meeting, October __, 2004, the total number of
common shares outstanding and entitled to vote was ___________________.
The holders of such shares are entitled to one vote for each share being
held on the record date. There is no cumulative voting on any matter on the
agenda of this meeting. No additional shares will be issued subsequent to call
date and prior to meeting.
REPORT AVAILABLE
A copy of our most current Annual Report on form 10KSB is attached hereto
and later filings may be obtained without charge, by writing us at David G.
Shier, Secretary, Mountains West Exploration, Inc., P.O. Box 754, Trinidad,
Colorado 81802.
BOARD OF DIRECTORS AND OFFICERS
The persons listed below are currently Officers and the members of the
Board of Directors. They are both nominees for Directors for the following term.
DIRECTORS AND EXECUTIVE OFFICERS
The directors and executive officers of the Company as of October __, 2004
are as follows:
Robert A. Doak, Jr., President, Treasurer and Director
David G. Shier, Vice President, Secretary and Director
The directors of the Company hold office until the next annual meeting of
the shareholders and until their successors have been duly elected and
qualified. The officers of the Company are elected at the annual meeting of the
Board of Directors and hold office until their successors are chosen and
qualified or until their death, resignation, or removal. The Company presently
has no executive committee.
The principal occupations of each director and officer and nominee for
director of the Company for at least the past five years are as follows:
NAME AGE POSITION WITH THE COMPANY TERM PERIOD OF SERVICE
---- --- ------------------------- ---- -----------------
Robert A.
Doak, Jr. 78 President, Treasurer Annual since 1979
and Director
David G. Shier 65 Vice President, Secretary Annual since 1981
and Director
9
ROBERT A. DOAK, JR., was an organizer of the Company and became a director
of the Company at its organizational meeting in 1979. He has served as the
President and a Director of the Company since 1979. Prior to becoming employed
by the Company, Mr. Doak was self-employed as a consulting geologist in
Trinidad, Colorado and Santa Fe, New Mexico from 1969 to 1979.
DAVID G. SHIER, became a Company director and the Company's Vice President
and Secretary in 1981 and has held those positions continuously since that time.
Mr. Shier has been self-employed in real estate sales and real estate
investments in Trinidad, Colorado from 1977 to present; executive Vice President
of Trinidad National Bank from 1974 to 1977.
Executive Compensation
- ------------------------
Remuneration
- -------------
The following information is set forth with respect to all remuneration
paid by the Company during the year ended December 31, 2003 to the Company's
five most highly paid executive officers or directors whose total remuneration
exceeded $50,000, and to all directors and officers as a group:
Securities
or Property, Aggregate of
Name of Insurance contingent
individual Salaries, fees benefits or forms of
or number of directors' fees reimbursement remuneration
persons in Capacities commissions, personal and proposed
group in which served Year and bonuses benefits remuneration
- ------ --------------- ---- ----------- -------- ----------
2003 $64,834 (1) 0 0
Robert A. Doak, Jr, President 2002 $12,000 0 0
Treasurer & Director 2001 0 0 0
================================================================================
2003 0 0 0
David G. Shier, Vice President 2002 0 0 0
Secretary & Director 2001 0 0 0
================================================================================
2003 $64,834 0 0
All directors and 2002 $12,000 0 0
officers as a group 2001 0 0 0
(2 Persons)
- -------------
(1) Consulting fees
10
LONG TERM COMPENSATION
----------------------
Options
Restricted & SARs
Stock LTIP LTIP Other
Awards Payouts Payouts Compensation
------ ------- ------- ------------
Robert A. Doak, Jr. None None None None
David G. Shier None None None None
Option/SAR Granted During the Last Fiscal Year
- ----------------------------------------------
No Options were granted during the last fiscal year.
Long Term Incentive Plans/Awards in Last Fiscal Year
- ----------------------------------------------------
Long Term Awards of Options issued in 2003:
None were granted during the last fiscal year.
The Company has one current director, Robert A. Doak, Jr., who devotes his
full time to the management of the Company.
Stock Purchase Plans; Profit Sharing and Thrift Plans
-----------------------------------------------------
Presently the Company has no stock purchase plans, profit-sharing or
thrift plans.
Options, Warrants or Rights
- ----------------------------
Presently the Company has not options, warrants or rights authorized.
Compensation Committee Interlocks
- ---------------------------------
The Securities and Exchange Commission requires disclosure where an
executive officer of a company served or serves as a director or on the
compensation committee of an entity other than the Company and an executive
officer of such other entity served or serves as a director or on the
compensation committee of the Company. The Company does not have any such
interlocks. Decisions as to executive compensation are made by the Compensation
Committee.
Audit Committee
- ---------------
The Company does not have an Audit Committee. The members of the Board sit
as the Audit Committee. No qualified financial expert has bee hired because the
company is to small to afford such expense.
11
Code of Ethics
- --------------
The Company has not adopted a Code of Ethics for the Board and the salaried
employees.
Committees and Procedures
- --------------------------
(1) The registrant has no standing audit, nominating and compensation
committees of the Board of Directors, or committees performing similar
functions. The Board acts itself in lieu of committees due to its
small size.
(2) The view of the board of directors is that it is appropriate for the
registrant not to have such a committee because all directors
participate in the consideration of director nominees and the board is
so small.
(3) Each of the members of the Board which acts as nominating committee is
not independent, pursuant to the definition of independence of a
national securities exchange registered pursuant to section 6(a) of
the Act (15 U.S.C. 78f(a).
(4) The nominating committee has no policy with regard to the
consideration of any director candidates recommended by security
holders, but the committee will consider director candidates
recommended by security holders;
(5) The basis for the view of the board of directors that it is
appropriate for the registrant not to have such a policy is that
there is no need to adopt a policy for a small company.
(6) The nominating committee will consider candidates recommended by
security holders, and by security holders in submitting such
recommendations; should provide a completed Directors Questionnaire to
the company
(7) There are no specific, minimum qualifications that the nominating
committee believes must be met by a nominee recommended by security
holders except to find anyone willing to serve with clean background.
There are no differences in the manner in which the nominating
committee evaluates nominees for director based on whether the nominee
is recommended by a security holder, or found by the board.
(8) The nominating committee's process for identifying and evaluation
nominees for director, including nominees recommended by security
holders, is to find anyone willing to serve with clean background.
There are no differences in the manner in which the nominating
committee evaluates nominees for director based on whether the nominee
is recommended by a security holder, or found by the board.
12
PRINCIPAL HOLDERS OF VOTING SECURITIES
a) The following table lists any person (including any "group" as that term
is used in Section 13(d)(3) of the Exchange Act) who, to the knowledge of the
Company, was the beneficial owner as of October __, 2004, of more than 5% of the
outstanding voting shares of the Company. Unless otherwise noted, the owner has
sole voting and dispositive power with respect to the securities.
Title Name and Address
of of Beneficial Amount of Five Percent
Class Owner Beneficial Ownership of
Interest Equity(1)
- --------- ---------------------- ------------ -----------
$.001 par value Robert A. Doak, Jr. 9,480,548 (2) 25.6%
common stock President, Treasurer direct
and Director
616 Central, S.E.,
Suite 213
Albuquerque, NM 87102
$0.001 par value GEDD, Inc. 5,590,800 15.28%
common stock 1400 North Woodward Ave. direct
Suite 270
Bloomfield Hills, Michigan
(1) With respect to the common stock, percentages shown are based upon
37,019,271 shares of common stock actually outstanding as of December
31, 2003.
(2) Includes 255,000 shares owned by Mr. Doak's wife.
b) Beneficial Ownership of Common Stock constituting Five Percent or over
if All Options Outstanding as of October __, 2004 had been Exercised.
Not Applicable.
(c) The following table sets forth as of October __5, 2004, the beneficial
ownership of the Company's voting shares by all current directors and executive
officers of the Company as a group. Unless otherwise indicated, each person
listed below has sole voting and investment power over all shares beneficially
owned by him.
Beneficial Ownership of Officers and Directors
Title Name of Amount and Percent
of Beneficial Nature of of
Class Owner Beneficial Equity
----- ----- Ownership -------
---------
$.001 par value Robert A. Doak, Jr. 9,480,548 (1) 25.6%
common stock President, Treasurer direct
and Director
616 Central, S.E.,
Suite 213
Albuquerque, NM 87102
$0.001 par value David G. Shier 312,511 (2) .85%
common stock Vice President, Secretary direct
and Director
259 N. Commercial St.
Trinidad, Colorado 81082
All Directors and officers as a group ------------- ------------
10,892,262 26.45%
(1) Includes 255,000 shares owned by Mr. Doak's wife.
(2) Includes 1,000 shares owned by Mr. Shier's wife.
13
d) The following table sets forth as of October __, 2004, the beneficial
ownership of the Company's voting shares by all current directors and executive
officers of the Company as a group if all the options outstanding in 2003 that
were exercisable were indeed exercised (although none were). Unless otherwise
indicated, each person listed below has sole voting and investment power over
all shares that would have been beneficially owned by him.
Not Applicable.
COMPLIANCE WITH SECTION 16 OF THE SECURITIES EXCHANGE ACT
Under Section 16 of the Securities Exchange Act 1934, the Company's
directors and executive officers and persons holding more than 10% of its common
stock are required to report their initial ownership of common stock and
subsequent changes to that ownership to the Securities and Exchange Commission
by specified due dates. To the Company's knowledge none of these filing
requirements were satisfied and both Robert A. Doak, Jr. and David G. Shier were
delinquent in filings.
The Company's Annual Report on Form 10-KB for the year ended December 31,
2003 (the "Form 10-KSB") is being furnished simultaneously herewith. The Form
10-KSB is not considered a part of this Proxy Statement.
Principal Accountant Fees and Services
- --------------------------------------
General. Michael Johnson & Co., LLC, CPAs ("MJC") is the Company's
principal auditing accountant firm. The Company's Board of Directors has
considered whether the provisions of audit services is compatible with
maintaining MJC's independence.
Audit Fees. MJC billed the Company $6,000 for the following professional
services: audit of the annual financial statement of the Company for the fiscal
year ended December 31, 2003, and review of the interim financial statements
included in quarterly reports on Form 10-QSB for the periods ended March 31,
2003, June 30, 2003 and September 30, 2003. MJC billed the Company $5,000 for
the 2002 audit and $4,000 for the 2003 Audit.
There were no audit related fees in 2003 or 2002. There were no tax fees or
other fees in 2003 or 2002 paid to Auditors or Auditors affiliates.
The Company's Board acts as the audit committee and had no "pre-approval
policies and procedures" in effect for the auditors' engagement for the audit
year 2003 and 2002.
All audit work was performed by the auditors' full time employees.
OTHER AND GENERAL INFORMATION.
Our Annual Report on Form 10-KSB, for the year ended December 31, 2003,
including audited financial statements as of that date, is available from us on
request. Further information is available by request or can be accessed on the
Internet. We are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files annual and quarterly reports, proxy statements and other
information with the Securities Exchange Commission (the "SEC"). Reports, proxy
statements and other information filed by Mountains West Exploration, Inc. can
be accessed electronically by means of the SEC's home page on the Internet at
http://www.sec.gov or at other Internet sites such as http://www.freeedgar.com
or http://www.pinksheets.com.
14
You can read and copy any materials that we file with the SEC at the SEC'S
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549. A copy
of any public filing is also available, at no charge, from the Company.
MOUNTAINS WEST EXPLORATION, INC.
Dated: October __, 2004
By the order of the Board of Directors
/s/ Robert A. Doak, Jr.
-----------------------
Robert A. Doak, Jr., President, Treasurer and Director
15
BALLOT
- --------------------------------------------------------------------------------
MOUNTAINS WEST EXPLORATION, INC.
P.O. Box 754
Trinidad, Colorado 81802
719-846-2623
PROXY FOR ANNUAL MEETING OF
STOCKHOLDERS, NOVEMBER ____, 2004
The undersigned hereby appoints Robert A. Doak, Jr., President, proxy, with
full power of substitution, for and in the name or names of the undersigned, to
vote all shares of Common Stock of Mountains West Exploration, Inc. held of
record by the undersigned at the Annual Meeting of Stockholders to be held on
_____________, November __, 2004, at ____ p.m., at The Sheraton Hotel, 360 Union
Blvd., Lakewood, Colorado, and at any adjournment thereof, upon the matters
described in the accompanying Notice of Annual Meeting and Proxy Statement,
receipt of which is hereby acknowledged, and upon any other business that may
properly come before, and matters incident to the conduct of, the meeting or any
adjournment thereof. Said person is directed to vote on the matters described in
the Notice of Annual Meeting and Proxy Statement as follows, and otherwise in
their discretion upon such other business as may properly come before, and
matters incident to the conduct of, the meeting and any adjournment thereof.
1. To authorize the Board of Directors to sell all of the oil and gas assets
of the Company for the best price they are able to negotiate.
[_] FOR [_] AGAINST [_] ABSTAIN
2. To elect a Board of two (2) directors to hold office until the next annual
meeting of stockholders or until their respective successors have been
elected and qualified:
Nominees: Robert A. Doak, Jr. and David G. Shier
[_] FOR: nominees listed above (except as marked to the contrary
below).
[_] WITHHOLD authority to vote for nominee(s) specified below.
INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), write
the applicable name(s) in the space provided below.
- --------------------------------------------------------------------------------
3. To ratify the appointment of Michael Johnson & Co., LLC as independent
accountants for the period ending December 31, 2004:
[_] FOR [_] AGAINST [_] ABSTAIN
4. To change the name of the corporation to a name to be determined by the
Board of Directors.
[_] FOR [_] AGAINST [_] ABSTAIN
5. To authorize a reverse split of the common stock up to a one for fifty
basis, by which each fifty shares shall become one share. Fractional shares
will not be issued.
[_] FOR [_] AGAINST [_] ABSTAIN
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON. WHETHER OR NOT
YOU PLAN TO ATTEND THE ANNUAL MEETING, YOU MAY SIGN AND RETURN THIS PROXY CARD
IN THE ENCLOSED ENVELOPE.
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION IS INDICATED, WILL
BE VOTED "FOR" THE STATED PROPOSALS.
----------------------------------------
Signature of Stockholder
----------------------------------------
Signature if held jointly
Dated: __________________________, 2004
IMPORTANT: If shares are jointly owned, both owners should sign. If signing as
attorney, executor, administrator, trustee, guardian or other person signing in
a representative capacity, please give your full title as such. If a
corporation, please sign in full corporate name by President or other authorized
officer. If a partnership, please sign in partnership name by authorized person.