REGISTRATION NO. ____-______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form SB - 2
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
XUNANTUNICH INC.
(Exact name of registrant as specified in
its charter)
Nevada 0273 76-0602960
(State or other jurisdiction of (Primary Standard Industrial (IRS Employer
incorporation or organization) Classification Code Number) identification
No.)
21112 123rd Avenue, Maple Ridge, BC, CANADAV2X
4B4
(604 ) 467-9116
(Address, including zip code, and telephone
number, including area code,
of registrant=s principal executive offices)
Agent for Service: With a Copy to:
David Young Arthur J. Frost
XUNANTUNICH INC. Inc. Arthur J. Frost Ltd.
21112 123rd Avenue 7549 West Heatherbrae Drive
Maple Ridge, BC V2X 4B4 Canada Phoenix, AZ 85033
(604) 467-9116 (623) 849-2050
(Name, address, including zip code, and telephone
number, including area code,
of agent for service)
Approximate date of commencement of
proposed sale to the public:
As soon as practicable after the
effective date of this Registration
Statement.
If any of the securities being
registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415
under the Securities Act, 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.
[ ]
If delivery of the prospectus is
expected to be made pursuant to Rule 434,
check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Title of Proposed Proposed
each Amount maximum Maximum Amount of
Class of to be offering Aggregate Registratio
Securities registered price Offering n
to per unit price Fee
be
registered
Common 1,510,000 $ .20 per $302,000.00 $ 84.56
stock shares share
1 No exchange or over-the-counter market
exists for XUNANTUNICH INC. common stock.
The average price paid for XUNANTUNICH INC.
common stock was $.0004 per share. .
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
Securities and Exchange Commission, acting
pursuant to such section 8(a), may determine.
WE WILL AMEND AND COMPLETE THE INFORMATION IN
THIS PROSPECTUS. ALTHOUGH WE ARE PERMITTED BY
US FEDERAL SECURITIES LAW TO OFFER THESE
SECURITIES USING THIS PROSPECTUS, WE MAY NOT
SELL THEM OR ACCEPT YOUR OFFER TO BUY THEM
UNTIL THE DOCUMENTATION FILED WITH THE SEC
RELATING TO THESE SECURITIES HAS BEEN
DECLARED EFFECTIVE BY THE SEC. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE
SECURITIES OR OUR SOLICITATION OF YOUR OFFER
TO BUY THESE SECURITIES IN ANY JURISDICTION
WHERE THAT WOULD NOT BE PERMITTED OR LEGAL.
SUBJECT TO COMPLETION B
Prospectus
February 22, 2000
XUNANTUNICH INC.
21112 123rd Avenue
Maple ridge, BC V2X 4B4 Canada
1,510,000 Shares of Common Stock
to be sold by the registrant as issuer and
current shareholders
This is the initial public offering of common
stock of XUNANTUNICH INC. Inc. and no public
market currently exists for shares of XUNANTUNICH
INC. Inc common stock. Only a portion of the
proceeds from the sale of stock in this offering
will be available to XUNANTUNICH INC. Inc. This
prospectus is part of a registration statement
that permits selling shareholders to sell their
shares on a continuous or delayed basis in the
future and permits XUNANTUNICH INC. Inc. to offer
for sale up to two million shares of its common
stock on a "self-underwritten" best efforts
basis. The most recent sale of XUNANTUNICH INC.
Inc. common stock in October, 1999 at a price of
$0.001 per share.
This is a self-underwritten offering, and
XUNANTUNICH INC..
stock is not listed on any national securities
exchange or the NASDQ Stock Market.
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK.
SEE ARISK FACTORS@ BEGINNING ON PAGE 1.
Neither the SEC nor any state securities
commission has approved or disapproved of these
securities or passed upon the adequacy or
accuracy of this prospectus. Nor have they made,
nor will they make, any determination as to
whether anyone should buy these securities. Any
representation to the contrary is a criminal
offense.
PART I
SUMMARY INFORMATION AND RISK FACTORS.
Description of Business
XUNANTUNICH INC. was incorporated under the laws
of the State of Nevada on April 2, 1999, and is
in the early developmental and promotional
stages. To date, XUNANTUNICH INC. only
activities have been organizational, directed at
acquiring its principal asset, raising its
initial capital and developing its business plan.
XUNANTUNICH INC. has not commenced commercial
operations. XUNANTUNICH INC. has no full time
employees and owns no real estate.
On April 5, 1999 XUNANTUNICH INC. acquired from
David R. Mortenson & Associates of Alvin, Texas,
the rights to distribute and produce, in the
states of Arizona and Nevada, an oxygen enriched
water product for fish farming, aquaculture,
mariculture, the husbandry of poultry, and for
remediating animal waste from dairies, feedlots
of all kinds, and for other similar uses.
Mortenson acquired these rights from the
inventors of the product, N. W. Technologies,
Inc. under a distribution agreement.
Subsequently, the underlying contract granting
David R. Mortenson & Associates rights to the
technology came into dispute.
While not in any way desiring to withdraw or void
the above-mentioned assignment, David R.
Mortenson & Associates has agreed to grant
additional rights to XUNANTUNICH INC.. These
rights will enable XUNANTUNICH INC. to develop
and implement a business plan.
David R. Mortenson and Associates is the holder
of certain rights, obtained from
Vitamineralherb.com Corp. (Vita), to an Internet
system for the marketing of vitamins, minerals
nutritional supplements and other health and
fitness products. DRM has granted XUNANTUNICH
INC. the exclusive rights to market all Vita
products to various health and fitness
practitioners for the Province of Alberta,
Canada.
Background
In recent years, the concept of a "virtual store"
has been realized with giants such as Amazon.com
and others. These virtual stores allow the
freedom to shop at home, remain anonymous, enjoy
complete privacy, and have goods delivered to
your home or business with a minimum of effort
and a maximum of convenience. Many individuals
and other concerns have the desire to establish a
virtual store but lack the knowledge, training
and significant funding needed.
Vitamineralherb.com Corp., through its licensing
and sub-licensing agreements has established a
virtual store that is designed to be operated by
those individuals and other concerns, mentioned
above. In addition to marketing to its home
territory of California, will offer territories
for their concept to others in a turnkey package.
The business is designed to market high quality
low cost vitamins, herbs, and health supplements
to health and fitness professionals for sale to
their clients. XUNANTUNICH INC. has identified an
average of 6,000 target health an fitness
practitioners for each of the territories that
will be sold. It is the Vita's belief that the
number of target customers is probably four times
the number currently identified.
Each territory license holder will sell, or hire
salesmen to sell, the concept to the health and
fitness owners. When these fitness professionals
sign up, they are assigned a number by XUNANTUNICH
INC. Web site that identifies them by territory,
sales person, and their business names, address,
etc. All products are then ordered directly from
XUNANTUNICH INC. Web and paid for with a credit
card, E-check, or debit card. All financial
transactions are handled under contract by ATS, an
Internet clearing bank and all products are
shipped directly to the practitioner by the
various suppliers. The practitioner may have his
name, address and telephone number added to the
label for a slight additional cost or private,
custom labeling, exclusive to the practitioner, is
available at a small additional charge.. Vita's
software tracks all sales and at month end E-mails
a detailed report including sales commissions, and
by E-transfer forwards the amounts due the license
holder. Vita retains 10% of all sales for
overhead, and charges the owner a $500 fee
annually for web-site maintenance.
While a specific territory is granted, this is not
a franchise and the owner may sell other goods or
services.
Vita will constantly seek new products and
services and offer these to the territorial
licensees and their clients.
Vita believes that this offers an opportunity to
participate in the greatest marketing revolution
in recent history so individuals and companies
that heretofore could not participate. By
eliminating the need for the owner of the business
to develop products and inventory them, and by
eliminating the need to develop a website, credit
card processors and fulfillment and delivery
systems, the license holder can focus on
marketing.
Markets
Many family physicians are realizing the value of
"wellness" in their practice. They are
recognizing the value of preventative measures and
certain other treatments and techniques long
advocated by practitioners of "alternative"
medicine. In addition, naturopaths,
chiropractors, massage therapists, acupuncturists,
health /aerobic centers are potential customers as
well as private individuals who may want a full or
part time means of generating income.
Risk Factors
Risk factors affecting operating results
The future success of XUNANTUNICH INC. depends on
a number of factors, many of which are beyond its
control. These factors include the costs
associated with new customer acquisition and
retention, capital expenditures and other costs
relating to expansion of operations, the timing of
new product and service announcements. Changes in
the pricing policies of XUNANTUNICH INC. and those
of its competitors; market acceptance of new and
enhanced versions of marketing policies; market
acceptance of new and enhanced versions of
XUNANTUNICH INC. products and services; changes in
operating expenses; changes in strategy;
personnel changes; the introduction of alternative
technologies; the effect of potential
acquisitions; increased competition in current
and prospective markets and other general economic
factors.
Operating results of XUNANTUNICH INC., cash flows
and liquidity may fluctuate significantly in the
future. Revenues depend on its ability to attract
and retain customers. XUNANTUNICH INC. expense
levels will be based, in part, on its expectations
as to future revenues. Furthermore, XUNANTUNICH
INC. operations could often require expense
expenditures in advance. The result could be
trailing revenues. To the extent that revenues
are below expectations, XUNANTUNICH INC. may be
unable or unwilling to reduce expenses
proportionately, and operating results, cash flow
and liquidity are likely to be adversely affected.
To remain competitive from a pricing standpoint,
XUNANTUNICH INC. may not be able to increase
prices to match increasing expenses and therefore,
could experience deteriorating markup margins or
experience losses.
Technology trends
The health supplement and herbal market is
continually changing and new products must be
offered regularly to keep customer interest.
Various suppliers and the media are constantly
searching for a now product that will give them at
least a temporary market advantage. The
vitamin/herbal supplement market relies on certain
standard supplement products, but can be fickle as
to type of capsule, dosage, and overall usage of
even these standard products. Credibility as to
pricing is also a factor. In some cases too low a
price is almost as negative as too high a price. A
balance must be struck in order to maintain volume
and markup margin.
Opposition by mainstream medicine and negative
media reports
Additionally, there is the constant pressure of
mainstream medicine, represented by agencies such
as the American Medical Association, American
Cancer Association, and various interests in the
insurance industry. These organizations have
excellent access to the media and could result in
negative publicity about the effectiveness of
health supplements. These organizations could see
dollars spent on alternative health products and
services as contrary to their interests. On the
other hand, the media is constantly seeking
attention-getting stories to draw
readership/viewers. The medical organizations
constantly lobby Government at all levels for
greater control and stricter regulations of the
manufacture and distribution of health
supplements. Should they be successful in the
imposition of new, stricter rules, particularly in
methods of distribution (i.e. all vitamins and
other supplements must be purchased through
licensed pharmacies) the results could be
catastrophic for XUNANTUNICH INC..
XUNANTUNICH INC. may not have the ability to react
to technology changes in a timely manner
The market for Internet access and E-commerce is
characterized by rapidly changing technology,
evolving industry standards, changes in customer
needs and frequent new service introductions. The
future success of XUNANTUNICH INC. will depend, in
part, on its ability to use leading technologies
effectively; to continue to develop its technical
expertise and that of its out-source contractor;
to enhance its existing services and develop new
services to meet changing customer needs on a
timely and cost-effective basis.
There can be no assurance that XUNANTUNICH INC.
will be successful in using new technologies
effectively, developing new services or enhancing
existing services on a timely basis or that such
new technologies or enhancements will achieve
market acceptance.
Although XUNANTUNICH INC. intends to support
emerging standards in the market for Internet
services, there can be no assurance that industry
standards will be established. If such standards
become established, there is no assurance that
XUNANTUNICH INC. will be able to conform to these
new standards in a timely fashion and maintain a
competitive position in the market. In addition,
there can be no assurance that services or
technologies developed by others will not render
XUNANTUNICH INC. services or technologies
noncompetitive or obsolete.
Dependence on Telecommunications Carriers & Other
Suppliers
XUNANTUNICH INC. will rely on local telephone
companies and other companies to provide data
communications capacity through their facilities.
XUNANTUNICH INC. may experience technical
disruptions or capacity constraints in these
services and may not have the means to remedy
these problems on a timely basis or at all. These
occurrences could result in an interruption of
the business of XUNANTUNICH INC. and adversely
effect its profit, if any.
In addition, the inability or unwillingness of any
third-party to provide POP (Point of Presence)
access to XUNANTUNICH INC. members or XUNANTUNICH
INC. inability to secure alternative POP
arrangements upon partial or complete termination
of a third-party network provider agreement or
other loss of access to such POPs could
significantly limit XUNANTUNICH INC. ability to
provide Internet access to its members and could
limit XUNANTUNICH INC. ability to expand to new
markets, which could, in turn, have a material
adverse effect on XUNANTUNICH INC. business,
financial condition and results of operations.
There can be no assurance that, if access to one
or more Virtual POPs is lost, any alternative
arrangements will be available, or, if available,
that such arrangements will be on terms acceptable
to XUNANTUNICH INC..
While third-party providers are contractually
obligated to provide commercially reliable
service to XUNANTUNICH INC. members with a
significant assurance of accessibility to the
Internet, there can be no assurance that such
services or Internet access will meet the
requirements of XUNANTUNICH INC., which could
materially adversely affect volume of business,
results from operations and financial condition.
XUNANTUNICH INC. operations and services will be
dependent on the extent to which its equipment or
that of its third-party providers (over which it
has no direct control) is protected against
damage from fire, earthquakes, power loss, system
failures or similar events. In addition, failure
of telecommunications providers to provide the
required data transmission capacity for any
reason could cause interruptions in the services
provided by XUNANTUNICH INC..
Growth strategy and potential acquisitions
There can be no assurance that XUNANTUNICH INC.
will be successful in implementing its growth
strategy, and any failure could have a materially
adverse effect on XUNANTUNICH INC. business,
financial condition and results of operations.
One component of its growth strategy; the
possible strategic acquisition of similar
businesses, involves certain risks, including,
among others, the difficulty in assimilating
operations and personnel; the potential
disruption of ongoing business at the time of
acquisition; the possible inability of management
to maximize the financial and strategic position
of XUNANTUNICH INC. after acquisition; the risks
entering markets in which XUNANTUNICH INC. has
little or no direct prior experience and
potential impairment of relationships with
employees and customers as a result of changes in
management.
In addition, any such transaction could
materially adversely affect XUNANTUNICH INC.
operating results due to dilution due to issuance
of equity securities, the incurring of additional
debt and the amortization of expenses related to
goodwill and other intangible assets, if any.
Competition
The market for Internet access to individuals is
extremely competitive and highly fragmented.
There are no substantial barriers to entry, and
XUNANTUNICH INC. expects that competition will
continue to intensify. XUNANTUNICH INC. believes
that the primary competitive factors determining
the success in this market are a reputation for
reliability and service, effective customer
support, pricing, creative marketing, easy-to-use
software and geographic coverage.
Other important factors include the timing of
introductions of new products, industry and
general economic trends. There can be no
assurance that XUNANTUNICH INC. will be able to
compete successfully against current or future
competitors or that competitive pressures faced
by XUNANTUNICH INC. will not materially adversely
affect its business, financial condition and
results of operations. Competitors could include
many larger companies that may have substantially
greater market presence and financial, technical,
marketing and other resources than XUNANTUNICH
INC..
Dependence on and ability to attract key personnel
XUNANTUNICH INC. success depends, in part, upon
the efforts of its founders and current officers
and directors. Senior management and technical,
marketing and sales personnel could be needed in
the reasonable near future. The success of
XUNANTUNICH INC. also depends on its ability to
attract and retain this highly qualified
management, technical, marketing and sales
personnel. The inability to attract qualified
personnel could materially adversely affect
XUNANTUNICH INC. business, financial condition and
results of operations.
Security Risks
XUNANTUNICH INC. network infrastructure may be
vulnerable to computer viruses, hacking or similar
disruptive problems caused by customers, connected
Internet sites, the interconnecting networks and
the various telephone networks. Computer viruses
or problems caused by third parties could lead to
interruptions, delays or cessation in service to
XUNANTUNICH INC. members and customers.
Although XUNANTUNICH INC. will implement and
maintain security measures to prevent any of the
problems mentioned above, such measures have been
circumvented in the past. There can be no
assurance that measures implemented by XUNANTUNICH
INC. will not be circumvented in the future.
Management currently on an as-needed basis
The rapid execution necessary for XUNANTUNICH INC.
to fully exploit the market for its services
requires an effective planning and management
process. XUNANTUNICH INC. growth may place a
significant strain on XUNANTUNICH INC. managerial,
operational and financial resources.
The present officers and directors of XUNANTUNICH
INC. are currently acting on an "as needed" basis.
One or more may become involved full-time as the
business plan of XUNANTUNICH INC. is implemented.
XUNANTUNICH INC. has no employment contracts with
any officer or director. All have other business
interests and occupations and there can be no
assurance that one or all would be available on a
full-time basis. Non-availability of these key
people could have a delaying effect on the
implementation of the XUNANTUNICH INC. business
plan, a drain on financial resources and an
adverse effect on price of the common stock.
In order to effectively manage its operations,
XUNANTUNICH INC. will be required to continue to
implement and improve its operational, financial,
and management information systems and to
identify, attract, train, integrate and retain
qualified personnel. These demands will probably
require the addition of new management personnel
and the development of additional expertise by
existing management.
New and Uncertain Market New and Uncertain Market
The market for Internet accessible vitamin,
health, and nutritional products and related
services and products is in an early stage
growth. The success of XUNANTUNICH INC. will
depend upon the continuing development and
expansion of the Internet and the market for
Internet goods and services. If demand for
Internet goods and services fails to continue to
grow, or grows more slowly than anticipated or
becomes saturated with competitors, the volume of
business, operating results and financial
condition of XUNANTUNICH INC. may be materially
adversely affected.
Conversely, to the extent that the Internet
continues to experience significant growth in
number of users and level of use, there can be no
assurance that the Internet infrastructure will
be able to support the demands placed on it by
such growth.
Potential Liability
XUNANTUNICH INC. has limited or no control over
its customers' use of health and vitamin
supplements after the sale. In addition,
XUNANTUNICH INC. has little control over the
online practices and the information passed
through or stored on its systems by its customers
or members. The law relating to the liability of
Internet access providers and online services
companies for incorrect use of the Internet and
information carried on or disseminated through
their networks is unsettled. Although
XUNANTUNICH INC. does not plan to actively
monitor the content of its customers' Internet
transmissions, there can be no assurance that
XUNANTUNICH INC. would not be considered to have
knowledge of such content. Nor can there be any
assurance if XUNANTUNICH INC. were to be
prosecuted that any defenses to liability would
be applicable.
Government Regulations
Internet-related regulatory policies are
continuing to develop, and it is possible that
XUNANTUNICH INC. could be exposed to regulation
in the future. Due to the increasing popularity
and use of the Internet, it is possible that
additional federal, state or other laws and
regulations may be adopted. These could cover
issues such as content, privacy, encryption
standards, consumer protection, electronic
commerce, taxation, copyright infringement and
other intellectual property issues.
Need for Additional Capital
XUNANTUNICH INC. has insufficient capital to fully
implement its business plan; to respond to
unanticipated technological developments or
competitive pressures or to take advantage of
unanticipated opportunities, such as special
marketing programs, the development of new
services or larger than anticipated acquisitions
of complimentary businesses. The success of the
establishing the business, creation of sales and
follow-up service depends
upon an injection of new capital through this
offering of the securities of XUNANTUNICH INC..
No other source of capital has been approached and
if this offering is not at least partially
successful, there can be no assurance that other
sources are available or, if available, capital
can be obtained on terms and conditions that are
acceptable to XUNANTUNICH INC.. Further, any such
financing may be upon terms that result in
dilution of the shares currently held by
XUNANTUNICH INC. shareholders.
Risks Related to the Securities Market
XUNANTUNICH INC. common stock has no prior market,
and prices may decline after the effectiveness of
this prospectus and subsequent resale of shares by
selling shareholders.
There is no public market for the common stock of
XUNANTUNICH INC. and no assurance can be given
that a market will develop or that any shareholder
will be able to liquidate his investment without
considerable delay, if at all. The trading market
price of the common stock may decline below the
price at which it was sold by XUNANTUNICH INC. and
selling stockholder(s). If a market should
develop, the price may be highly volatile. In
addition, an active public market for the common
stock of XUNANTUNICH INC. may not develop or be
sustained. If XUNANTUNICH INC. and selling
stockholders sell substantial amounts of common
stock through this offering or in a public market
(should one develop), the market price of its
common stock could fall. Factors such as those
discussed in this ARisk Factors@ section may have
a significant impact on the market price of the
securities of XUNANTUNICH INC..
Owing to the low price of the securities many
brokerage firms may not be willing to effect
transactions in the securities. Even if a
purchaser finds a broker willing to effect a
transaction in the common stock of XUNANTUNICH
INC., the combination of brokerage commissions,
state transfer taxes, if any, and other selling
costs may exceed the selling price. Further, many
lending institutions will not permit the use of
such securities as collateral for loans. Thus, a
purchaser may be unable to sell or otherwise
realize the value invested in XUNANTUNICH INC.
stock.
The securities of XUNANTUNICH INC., when available
for trading, will be subject to the Securities and
Exchange Commission rule that imposes special
sales practice requirements upon broker-dealers
that sell such securities to other than
established customers or accredited investors.
For purposes of the rule, the phrase "accredited
investors" means, in general terms, institutions
with assets exceeding $5,000,000 or individuals
having a net worth in excess of $1,000,000 or
having an annual income that exceeds $200,000 (or
that, combined with a spouses income, exceeds
$300,000). For transactions covered by the rule,
the broker-dealer must make a special suitability
determination for the purchaser and receive the
purchasers written agreement to the transaction
prior to the sale. Consequently, the rule may
affect the ability of purchasers of XUNANTUNICH
INC. securities to buy or sell in any market that
may develop.
Investors may face significant restrictions on
the resale of XUNANTUNICH INC. stock due to state
and federal laws and regulations
Because the securities of XUNANTUNICH INC. have
not been registered for resale under the blue sky
laws of any state, the holders of such shares and
those persons desiring to purchase them in any
trading market that may develop in the future
should be aware that there may be significant
state blue sky law restrictions on the ability of
investors to sell and on purchasers to buy its
securities. Accordingly, investors should
consider the secondary market for XUNANTUNICH
INC. securities to be a limited one. Investors
may be unable to resell their stock without the
significant expense of state registration or
qualification.
In addition, the Securities and Exchange
Commission has adopted a number of rules to
regulate Apenny stocks.@ Such rules include
Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5,
15g-6 and 15g-7 under the Securities and Exchange
Act of 1934. Because its securities may
constitute Apenny stock@ within the meaning of
the rules, the rules would apply to XUNANTUNICH
INC. and its securities. The rules may further
affect the ability of owners of XUNANTUNICH INC.
shares to sell their securities in any market
that may develop for them.
Shareholders should be aware that, according to
the Securities and Exchange Commission Release
No. 34-29093, the market for penny stocks has
suffered in recent years from patterns of fraud
and abuse. Such patterns include (i) control of
the market for the security by one or a few
broker-dealers that are often related to the
promoter or issuer; (ii) manipulation of prices
through prearranged matching of purchases and
sales and false and misleading press releases;
(iii) Aboiler room@ practices involving high
pressure sales tactics and unrealistic price
projections by inexperienced sales persons; (iv)
excessive and undisclosed bid-ask differentials
and markups by selling broker-dealers; and (v)
the wholesale dumping of the same securities by
promoters and broker-dealers after prices have
been manipulated to a desired level, along with
the inevitable collapse of those prices with
consequent investor losses.
Management of XUNANTUNICH INC. believes it has
described above all material risks known to it at
this time.
USE OF PROCEEDS
Legal Fees $30,000.00
Accounting 10,000.00
Electronic filing and printing 5,000.00
Start up costs (office equipment, telephone
System, computers and software 60,000.00
Working Capital 95,000.00*
Total 200,000.00
* Assumes offering is fully subscribed to.
Working capital figure will adjusted downward in
the event all or any part of the offering is sold
through a Broker/Dealer or total offering is not
subscribed to.
DETERMINATION OF OFFERING PRICE
The offering price of this issue was set in a
purely arbitrary manner. XUNANTUNICH INC.
determined the amount of money needed to fully
implement its plan of business; added a
contingency amount; allowed for printing, legal
and accounting costs and possible commissions if
a Broker/Dealer should become involved with the
sale to the public of this issue. Management
also took into account the resultant number of
shares in the "float", i.e. the number of shares
available to be traded. The final consideration
was the perceived market capitalization (the
theoretical total worth of the shares of
XUNANTUNICH INC. if they were all sold at a
specific price at the same time).
A portion of this offering is solely for the
purpose of allowing some shareholders of
XUNANTUNICH INC. to sell their stock. The
selling shareholders may sell their shares when
the registration statement becomes effective, or
they may elect to sell some or all of their
shares at a later date. In every case, selling
shareholders are likely to show a large gain
should they sell their shares at a price at or
near the offering price. Should they decide to
sell their shares unintentionally at the same
time, the result could well be an over - supply
of stock on the market resulting in a decrease in
the share price.
DILUTION
XUNANTUNICH INC., prior to this offering has
5,000,000 shares of stock issued and outstanding.
510,000 shares of this amount are being qualified
for sale as part of this registration statement.
If the total offering is subscribed to the total
net assets of XUNANTUNICH INC. would be a maximum
of $202,000 (without commission or expenses being
deducted). This amount divided by 6,000,000
shares establishes the maximum book value of $
0.0337 per share, a figure considerably lower
than the price paid by subscribers to this
offering. Prospective investors should pay
careful consideration the above facts.
A portion of this offering is for sales of stock
by existing XUNANTUNICH INC. shareholders on a
continuous or delayed basis in the future. Sales
of common stock by shareholders will not result
in any substantial change to the net tangible
book value per share before and after the
distribution of shares by the selling
shareholders. There will be no change in net
tangible book value per share attributable to
cash payments made by purchasers of the shares
being offered.
Prospective investors should be aware, however,
that the price of the shares of XUNANTUNICH INC.
might not bear any direct relationship to net
tangible book value per share. The price received
by selling stockholders and paid by purchasing
investors will be determined by supply and demand.
If the demand for the common stock of exceeds the
available supply, the price will tend to go up.
Conversely, if the supply exceeds the demand, the
price will tend to go down. In both of the above
cases the change in price may have no relation to
the book value of XUNANTUNICH INC. or its
profitability or lack thereof.
SELLING SECURITY HOLDERS
The following are the shareholders for whose
accounts the shares are being offered; the amount
of securities owned by such shareholder prior to
this offering; the amount to be offered for such
shareholder=s account; and the amount to be owned
by such shareholder following completion of the
offering:
No. Perce
Positi Number Number of nt
Name on of of Share After
with Shares Shares s Sale
Compan Owned Offered After
y Sale
Rod Albers None -0- -0-
1,000 1,000
Allison Flechl None 251,000 -0- -0-
251,000
Kodi Flechl None -0- -0-
1,000 1,000
Michael Flynn None -0- -0-
1,000 1,000
James Fortin None -0- -0-
1,000 1,000
Peter James None -0- -0-
1,000 1,000
Sharon None -0- -0-
Marcotte 1,000 1,000
Al Sanderson None -0-
1,000 1,000
Jeremy None -0-- -0-
Yasenuik 1,000 1,000
Adrienne None -0- -0-
Yasenuik 1,000 1,000
David Young None 250,000 -0- -0-
250,000
PLAN OF DISTRIBUTION
This is a self - underwritten offering. This
prospectus is part of a registration statement
that permits the Officers and Directors of
XUNANTUNICH INC. to sell directly to the public,
with no commission or other remuneration payable.
At the discretion of the Board of Directors of
XUNANTUNICH INC. an underwriting contract may be
entered into with one or more Broker/Dealers on a
"best efforts" or firm basis. In this case,
commissions and expenses within the guidelines of
the NASD would be negotiated.
This prospectus is also part of a registration
statement that enables selling shareholders to
sell their shares on a continuous or delayed basis
in the future. Selling shareholders may sell
their shares to the public when the registration
statement becomes effective, or they may elect to
sell some or all of their shares at a later date.
XUNANTUNICH INC. has not committed to keep the
registration statement effective for any set
period of time.
While the registration statement is effective,
selling shareholders may sell their shares
directly to the public, without the aid of a
broker or dealer, or they may sell their shares
through a broker or dealer if the stock of
XUNANTUNICH INC. is authorized for inclusion on
the OTC bulletin board or any other exchange or
quotation service.. Any commission, fee or other
compensation of a broker or dealer would depend on
the brokers or dealers involved in the
transaction.
No public market currently exists for shares of
XUNANTUNICH INC. common stock. XUNANTUNICH INC.
intends to apply to have its shares traded on the
NASD OTC Bulletin Board.
LEGAL PROCEEDINGS.
To the best of the knowledge of XUNANTUNICH INC.,
no legal proceedings have been or are currently
being undertaken for or against XUNANTUNICH INC.
nor is any contemplated
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS.
The directors and executive officers currently
serving XUNANTUNICH INC. are as follows:
Name Age Positions Held and Tenure
Mark Cramer 59 President and Director since
November, 1999
Florence Cramer 59 Secretary/Treasurer and
Director since November/99
Michael Cramer 34 Vice President and
Director Since December, 1999
Grant Cramer 28 Director since December/99
The directors named above will serve until the
first annual meeting of XUNANTUNICH INC.'s
stockholders. Thereafter, directors will be
elected for one-year terms at the annual
stockholders' meeting. Officers will hold their
positions at the pleasure of the board of
directors, absent any employment agreement, of
which none currently exists or is contemplated.
There is no arrangement or understanding between
the directors and officers of XUNANTUNICH INC. and
any other person pursuant to which any director or
officer was or is to be selected as a director or
officer.
Biographical information
Mark Cramer. Mr. Cramer, XUNANTUNICH INC.'s
President, has served as an officer and director
since November, 1999. Since 1988, Mr. Cramer has
been actively involved as a Financial Consultant
in the Province of British Columbia, Canada. He
holds a Masters degree from Simon Fraser
University, holds life and mutual funds licenses,
has obtained registration to sell securities, has
a Chartered Financial Planning degree. He is
President, Chairman and major shareholder in
Comprehensive Financial Services, Inc., a full-
service financial planning and consulting company.
He is also President and Chairman of River Ranch
Resort Corp., a full service facility catering to
hunters, fishermen, snowmobilers and nature
lovers.
In 1987, Mr. Cramer retired after a twenty-five
year career as teacher, principal and
Administrative Assistant to the Superintendent of
Schools, District #57, British Columbia.
Florence Cramer. Mrs. Cramer, XUNANTUNICH INC.'s
Secretary/Treasurer has served as an officer and
director since November, 1999. She has a multi-
year background as a Life Underwriter and
Financial Planner. She formed Comprehensive
Financial Services in 1987 and currently serves as
a director and Secretary/Treasurer of that
Company. Mrs. Cramer holds a diploma in Office
Administration .
Michael Cramer. Mr. Cramer, XUNANTUNICH INC.'s
Vice President has served as an officer and
director since December, 1999. Since 1985 he has
been involved in the financial services field
holding Life Insurance and Mutual Fund licenses as
well as being registered to sell securities. He
also has earned a Professional Financial Planning
designation and serves as director and Vice
President of Comprehensive Financial Services Inc.
Grant Cramer. Mr. Cramer has served as a director
of XUNANTUNICH INC. since December, 1999. He is
currently a director of Comprehensive Financial
Services Inc. and IDF Financial Services Inc. He
has a substantial background in hiring and
training Financial Planners and holds a
Professional Financial Planning designation and is
registered to sell securities.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of the date of
this Registration Statement, the number of shares
of Common Stock owned of record and beneficially
by executive officers, directors and persons who
hold 5.0% or more of the outstanding Common Stock
of XUNANTUNICH INC.. Also included are the shares
held by all executive officers and directors as a
group.
Name and Address Number of Percent of
Shares Owned Class OwneD
Beneficially
Mark Cramer*
6822 Valleyview Drive
Prince George, BC
V2K 4C6 Canada 1,915,000 38.50
Michael Cramer*
2408 Panorama Place
Prince George,
BC V2K 4T9 Canada 1,350,000 27.00
Florence Cramer*
6822 Valleyview Drive
Prince George, BC
V2K 4C6 Canada 1,000,000 20.00
Grant Cramer*
#202 - 8636 Laurel Street
Vancouver, BC
V6P 3V6 Canada 225,000 04.50
All directors and
executive
Officers as a group
(4 persons) 4,490,000 89.80%
* All of the officers and directors of
XUNANTUNICH INC. are related. Florence Cramer,
XUNANTUNICH INC.'s Secretary/Treasurer and
director is the wife of Mark Cramer, XUNANTUNICH
INC.'s President and director. Both Michael
Cramer, Vice President and director and Grant
Cramer, director are the adult sons of Mark and
Florence Cramer. All of the officers and
directors of XUNANTUNICH INC. have independent
means and incomes and state categorically that
they are not holding any shares beneficially for
any other person.
The persons listed are the sole officers and
directors of XUNANTUNICH INC..
The directors and officers of XUNANTUNICH INC.
will devote their time to XUNANTUNICH INC.'s
affairs on an "as needed" basis. As a result, the
actual amount of time, which they will devote to
XUNANTUNICH INC.'s affairs, is unknown and is
likely to vary substantially from month to month.
Conflicts of Interest
The officers and directors of XUNANTUNICH INC.
will not devote more than a portion of their time
to the affairs of XUNANTUNICH INC.. There will be
occasions when the time requirements of
XUNANTUNICH INC.'s business conflict with the
demands of their other business and investment
activities. Such conflicts may require that
XUNANTUNICH INC. attempt to employ additional
personnel. There is no assurance that the
services of such persons will be available or that
they can be obtained upon terms favorable to
XUNANTUNICH INC..
There is no procedure in place, which would allow
any of the Cramers to resolve potential conflicts
in an arms-length fashion. Accordingly, he will
be required to use his discretion to resolve them
in a manner, which they consider appropriate.
DESCRIPTION OF SECURITIES
Common Stock
The Articles of Incorporation of XUNANTUNICH INC.
authorize the issuance of 100,000,000 shares of
Common Stock. Each record holder of Common Stock
is entitled to 1 vote for each share held on all
matters properly submitted to the stockholders for
their vote. The Articles of Incorporation do not
permit cumulative voting for the election of
directors.
Holders of outstanding shares of Common Stock are
entitled to such dividends as may be declared from
time to time by the Board of Directors out of
legally available funds and, in the event of
liquidation, dissolution or winding up of the
affairs of the XUNANTUNICH INC., holders are
entitled to receive, ratably, the net assets
available to stockholders after distribution is
made to the preferred shareholders, if any, who
are given preferred rights upon liquidation.
Holders of outstanding shares of Common Stock have
no preemptive, conversion or redemptive rights.
All of the issued and outstanding shares of Common
Stock are, and all unissued shares when offered
and sold, will be duly authorized, validly issued,
fully paid, and non assessable. To the extent
that additional shares of XUNANTUNICH INC.'s
Common Stock are issued, the relative interests of
then existing stockholders may be diluted.
Preferred Stock
The Articles of Incorporation of XUNANTUNICH INC.
authorize the issuance of 10,000,000 shares of
preferred stock. The Board of Directors is
authorized to issue preferred shares from time to
time in series and is further authorized to
establish such series, to fix and determine the
variations in the relative rights and preferences
as Common Stock. No preferred stock has been
issues by XUNANTUNICH INC..
Transfer Agent
XUNANTUNICH INC. is currently serving as its own
transfer agent, and plans to continue to serve in
that capacity until such time as management
believes it is necessary or appropriate to employ
an independent transfer agent in order to
facilitate the creation of a public trading market
for its securities. Should XUNANTUNICH INC.
securities be quoted on any exchange or OTC
quotation system or application is made to have
the securities quoted, an independent transfer
agent will be appointed.
Indemnification of Officers and Directors
As permitted by Nevada law, XUNANTUNICH INC.'s
Articles of Incorporation provide that XUNANTUNICH
INC. will indemnify its directors and officers
against expenses and liabilities they incur to
defend, settle, or satisfy any civil or criminal
action brought against them on account of their
being or having been Company directors or
officers, unless, in any such action, they are
adjudged to have acted with gross negligence or
willful misconduct.
Exclusion of Liabilities
Pursuant to the laws of the State of Nevada,
XUNANTUNICH INC.'s Articles of Incorporation
exclude personal liability for its directors for
monetary damages based upon any violation of their
fiduciary duties as directors, except as to
liability for any breach of the duty of loyalty,
acts or omissions not in good faith or which
involve intentional misconduct or a knowing
violation of law, acts in violation of Section 7-
106-401 of the Colorado Business Corporation Act,
or any transaction from which a director receives
an improper personal benefit. This exclusion of
liability does not limit any right, which a
director may have to be indemnified, and does not
affect any director's liability under federal or
applicable
state securities laws.
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted
to directors, officers or persons controlling
XUNANTUNICH INC. pursuant to provisions of the
State of Nevada, XUNANTUNICH INC. has been
informed that, in the opinion of the Securities
and Exchange Commission, such indemnification is
against public policy as expressed in that Act and
is, therefore, unenforceable.
ORGANIZATION WITHIN THE LAST FIVE YEARS
XUNANTUNICH INC. was incorporated in the State of
Nevada on April 2, 1999 and is in the early stages
of development. From inception the only
activities of XUNANTUNICH INC. have been the
development of its business plan and the
preparation for this Registration Statement. It
has no revenues nor does it have any expectation
of revenues until the completion of this offering
and the commencement of business.
DESCRIPTION OF BUSINESS
XUNANTUNICH INC. was incorporated under the laws
of the State of Nevada on April 2, 1999, and is in
the early developmental and promotional stages.
To date, XUNANTUNICH INC. only activities have
been organizational, directed at acquiring its
principal asset, raising its initial capital and
developing its business plan. XUNANTUNICH INC.
has not commenced commercial operations.
XUNANTUNICH INC. has no full time employees and
owns no real estate.
On April 5, 1999 XUNANTUNICH INC. acquired from
David R. Mortenson & Associates of Alvin, Texas,
the rights to distribute and produce, in the
states of Arizona and Nevada, an oxygen enriched
water product for fish farming, aquaculture,
mariculture, the husbandry of poultry, and for
remediating animal waste from dairies, feedlots of
all kinds, and for other similar uses. Mortenson
acquired these rights from the inventors of the
product, N. W. Technologies, Inc. under a
distribution agreement. Subsequently, the
underlying contract granting David R. Mortenson &
Associates rights to the technology came into
dispute.
While not in any way desiring to withdraw or void
the above-mentioned assignment, David R. Mortenson
& Associates has agreed to grant additional rights
to XUNANTUNICH INC.. These rights will enable
XUNANTUNICH INC. to develop and implement a
business plan.
DRM is the holder of certain rights, obtained from
Vitamineralherb.com Corp. (Vita), to an internet
system for the marketing of vitamins, minerals
nutritional supplements and other health and
fitness products. DRM has granted XUNANTUNICH
INC. the exclusive rights to market all Vita
products to various health and fitness
practitioners for the Province of Alberta, Canada.
Background
In recent years, the concept of a "virtual store"
has been realized with giants such as Amazon.com
and others. These virtual stores allow the
freedom to shop at home, remain anonymous, enjoy
complete privacy, and have goods delivered to your
home or business with a minimum of effort and a
maximum of convenience. Many individuals and
other concerns have the desire to establish a
virtual store but lack the knowledge, training and
significant funding needed. Vitamineralherb.com
Corp., through its licensing and sub-licensing
agreements has established a virtual store that is
designed to be operated by those individuals and
other concerns, mentioned above. In addition to
marketing to its home territory of California,
will offer territories for their concept to others
in a turnkey package.
The business is designed to market high quality
low cost vitamins, herbs, and health supplements
to health and fitness professionals for sale to
their clients. XUNANTUNICH INC. has identified an
average of 6,000 target health an fitness
practitioners for each of the territories that
will be sold. It is the Vita's belief that the
number of target customers is probably four times
the number currently identified.
Each territory license holder will sell, or hire
salesmen to sell, the concept to the health and
fitness owners. When these fitness professionals
sign up, they are assigned a number by XUNANTUNICH
INC. Web site that identifies them by territory,
sales person, and their business names, address,
etc. All products are then ordered directly from
XUNANTUNICH INC. Web and paid for with a credit
card, E-check, or debit card. All financial
transactions are handled under contract by ATS, an
Internet clearing bank and all products are
shipped directly to the practitioner by the
various suppliers. The practitioner may have his
name, address and telephone number added to the
label for a slight additional cost or private,
custom labeling, exclusive to the practitioner, is
available at a small additional charge.. Vita's
software tracks all sales and at month end E-mails
a detailed report including sales commissions, and
by E-transfer forwards the amounts due the license
holder. Vita retains 10% of all sales for
overhead, and charges the owner a $500 fee
annually for web-site maintenance.
While a specific territory is granted, this is not
a franchise and the owner may sell other goods or
services.
Vita will constantly seek new products and
services and offer these to the territorial
licensees and their clients.
Vita believes that this offers an opportunity to
participate in the greatest marketing revolution
in recent history so individuals and companies
that heretofore could not participate. By
eliminating the need for the owner of the business
to develop products and inventory them, and by
eliminating the need to develop a website, credit
card processors and fulfillment and delivery
systems, the license holder can focus on
marketing.
Markets
Many family physicians are realizing the value of
"wellness" in their practice. They are
recognizing the value of preventative measures and
certain other treatments and techniques long
advocated by practitioners of "alternative"
medicine. In addition, naturopaths,
chiropractors, massage therapists, acupuncturists,
health /aerobic centers are potential customers as
well as private individuals who may want a full or
part time means of generating income.
The province of Alberta, Canada, has a population
of well over two million and is considered to be
one of the most prosperous jurisdictions in the
country. As well as having a thriving
agricultural economy (grain, oil seeds and
cattle), Alberta is the center of the petroleum
industry in Canada.
There are nearly six thousand potential outlets
for the products and services offered by
XUNANTUNICH INC.. The removal of most, if not all
import duties, under the NAFTA accord enables
XUNANTUNICH INC. to import its goods without undue
trouble or delay. Some of sources relied upon for
product will undoubtedly be located in Canada and
will be easily be available to XUNANTUNICH INC. as
well as being exported to the United States.
MANAGEMENT=S DISCUSSION AND ANALYSIS OR PLAN
OF OPERATION.
Upon the completion of all or part of the sale of
shares contained in this offering, XUNANTUNICH
INC. intends to proceed as quickly as possible to
hire one or more sales representatives to present
its service to potential customers. Geography is
an obstacle that must be dealt with. The Province
of Alberta is very large, making adequate coverage
by one salesperson virtually impossible. A
minimum of two representatives will be necessary.
Subsequent to opening accounts, these
representatives will be necessary to service
existing customers. Research has indicated that
this servicing or detailing of accounts already
established results in dramatic increase in
reorders of product.
All of the planned activity of XUNANTUNICH INC.
has been reduced to initial sales and follow-up
service. Opening orders and reorders are made
through the facilities of the Internet.
XUNANTUNICH INC. is not obliged to purchase and
maintain a large inventory, an order desk or
shipping department. This method of doing
business, which only a short time ago would be
unthinkable is now a preferred way of shopping
(whether wholesale or retail) for a large segment
of the population of North America.
The Growth of Internet Shopping & Business-to-
Business Transactions
Analysts predict that we have seen only the tip of
the iceberg in the growth of online commerce (E-
Commerce) transactions conducted electronically
over the Internet. The Internet doubles every 100
days with new subscribers (PEW Research Centre and
CNN).
_ John Chambers, President of Cisco Systems,
Inc., claimed at the Comdex Trade Show
that electronic commerce could reach $1.5
trillion by the year 2000. However, in a
recent keynote address at Spring Internet
World, April 15,1999, Mr. Chambers re-
evaluated his projection stating that some
5% of all commerce is expected to be
conducted online by 2003, and the figure
could balloon to 25% by 2010. He added
that traditional retailers will continue
to struggle to meet the challenge offered
by online and offline competitors, adding
that those who learn how to use the
Internet to their best advantage will be
the ones to survive.
"25% of all commerce will be conducted
on the Internet by 2010"
_ Henry Blodgett of CIBC Oppenheimer in a
recent interview said he thinks that the
opportunity in online retailing is as big
as the Wal-Mart Stores super-store
opportunity was 30 years ago. He said that
retailing in general in the United States
is a $1 trillion business, of which he
thinks online retailing could ultimately
capture 10% or $100 billion.
_ Forrester Research predicts that online
business-to-business transactions will be
from US$1.5 trillion to $3.2 trillion by
2003. Similar to Chambers' re-evaluation,
Forrester's earlier prediction was US $300
Billion by 2002.
_ Price Waterhouse, in a 1998 report, states
that the value of consumer purchases via
the Internet is expected to increase
nearly 1,800 percent between 1997 and
2002; from $5 Billion to $97 Billion,
respectively.
Terry Retter, Director of Strategic
Technology at Price Waterhouse, noted that
between 1996 and 1997, business-to-
business trade via the Internet doubled
every six months and is accelerating to
double every 3 to 4 months in 1998. It is
estimated that by year 2002, the value of
goods and services traded via the Internet
will increase to $434 Billion.
The consulting firm's leading technology
industry experts said explosive growth in
electronic commerce over the next three
years will have a significant impact on
large and small business, workers and
consumers.
Current Internet User Graph
Presently, Nua, one of Europe's leading online
consultants and developers, estimates the number
of Internet users world wide to be 100.5 million.(
January 1998) By the end of the year 2000,
analysts predict that number will jump to 200
million. There will be continued growth rate of
30% for 1998, according to Computer Intelligence
report.
It estimated that North America Internet users
represent 80-85% of world wide users. A little
over one year ago almost 99% of the 13 million
servers hooked to the Internet were distributed
throughout North America, Western Europe and
Japan. Only 1% of Internet hosts were distributed
in the rest of the world.
DESCRIPTION OF PROPERTY.
In July, 1999, XUNANTUNICH INC. acquired from
David R. Mortenson and Associates of Alvin, Texas,
the rights to distribute and produce, in the
states of Arizona and Nevada, an oxygen enriched
water product for fish farming, aquaculture,
mariculture, the husbandry of poultry, and for
remediating animal waste from dairies, feedlots of
all kinds, and for other similar uses. Mortenson
acquired these rights from the inventors of the
product, N. W. Technologies, Inc. under a
distribution agreement. This technology promises
to shorten time to market for farm raised sea food
and poultry and to cut costs in the processing of
animal waste, and at the same time making this
waste less harmful to the environment. While
proprietary and not patented, this process is
virtually impossible to reverse engineer.
In December, 1999, N.W. Technologies unilaterally
cancelled its contract and distribution agreement
with David R. Mortenson and Associates. Mortenson
and several concerns that have an interest in the
technology through distribution agreements with
Mortenson, have laid suit in Harris County Court,
Houston, Texas against N.W. Technologies Inc., its
officers and directors and several other
individuals and concerns involved with the
cancellation and withdrawal.
In order to protect the shareholders of
XUNANTUNICH INC. and avoid possible litigation
from XUNANTUNICH INC., Mortenson has granted at no
charge to XUNANTUNICH INC., a distribution
territory for a Internet-based vitamin and health
supplement company, Vitamineralherb.com Corp. of
San Diego, California. The territory involved is
the Province of Alberta, Canada.
XUNANTUNICH INC. is not withdrawing from its
agreement with David R. Mortenson and Associates
nor has it any intention of doing so at this time.
If the legal barriers preventing the implementing
of the water treatment business plan are removed,
XUNANTUNICH INC. will re-evaluate its position.
The Board of Directors of XUNANTUNICH INC.
believes that the process developed by N.W.
Technologies, Inc. has real merit and good profit
possibilities and should XUNANTUNICH INC. decide
not to proceed with the development and
application of the process, believes the rights
purchased, have substantial value that may be
realized.
In the meantime, XUNANTUNICH INC. will proceed to
develop its distribution territory and Internet
marketing arrangement with Vitamineralherb.com
Corp.
CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS.
Prior to the date of this Registration Statement,
XUNANTUNICH INC. issued to its officers and
directors a total of 1,000,000 shares of Common
Stock in consideration of acquiring the rights to
manufacture and market an oxygen-enhanced product
for use in aquaculture, fish and poultry farming
and the bioremediation of waste ponds and lagoons.
XUNANTUNICH INC. filed the necessary papers
required for the issuance of these shares as
required by Regulation D of Rule 504 of the Act.
XUNANTUNICH INC. maintains a mailing address at
the office of one of its stockholders but
otherwise does not maintain an office. As a
result it pays no rent and incurs no expenses for
maintenance of an office and does not anticipate
paying rent or incurring office expenses in the
near future. It is likely that XUNANTUNICH INC.
will establish and maintain an office after its
business is operating and the volume of business
and the addition of personnel dictate the
acquisition of adequate premises.
Although management has no current plans to cause
XUNANTUNICH INC. to do so, it is possible that it
may enter into an agreement requiring the sale of
all or a portion of the Common Stock held by
current stockholders to other individuals or
business entities. It is more likely than not
that any sale of securities by XUNANTUNICH INC.'s
current stockholders would be at a price
substantially higher than that originally paid by
such stockholders or deemed to have been paid
through XUNANTUNICH INC.'s acquisition of one of
its assets. Any payment to current stockholders
in the context of an acquisition involving
XUNANTUNICH INC. would be determined entirely by
the largely unforeseeable terms of a future
agreement with an unidentified business entity.
MARKET FOR COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.
XUNANTUNICH INC. is a development stage company
that is still in the beginning stages of
implementing its business plan. No market
currently exists for the common stock. Upon
completion of all or part of the offering of
common shares contained in this registration
statement, it is the intention of XUNANTUNICH INC.
to apply for a trading symbol and a listing to
have its shares quoted on the NASD OTC Bulletin
Board. There can be no assurance that any part of
this offering will be subscribed to and if all or
part of the offering is subscribed to, that the
request of XUNANTUNICH INC. to have the price of
its stock quoted on the OTC Bulletin Board will be
granted. Prospective investors should take all of
the above facts into consideration before making s
decision to purchase any amount of XUNANTUNICH
INC. stock.
EXECUTIVE COMPENSATION.
No officer or director of XUNANTUNICH INC. has
received any remuneration. Although there is no
current plan in existence, it is possible that
XUNANTUNICH INC. will adopt a plan to pay or
accrue compensation to its officers and directors
for services related to the implementation of the
business plan. See "Certain Relationships and
Related Transactions". XUNANTUNICH INC. has no
stock option, retirement, pension or profit-
sharing programs for the benefit of directors,
officers or other employees, but the Board of
Directors may recommend adoption of one or more
such programs in the future.
FINANCIAL STATEMENTS.
XUNANTUNICH, INC.
(A Development Stage Enterprise)
AUDIT REPORT
December 31, 1999
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1777 S. Harrison Street, Suite 2100
Denver, Colorado 80210
XUNANTUNICH, INC.
(A Development Stage Enterprise)
INDEX TO FINANCIAL STATEMENTS
TABLE OF CONTENTS
ITEM PAGE
Report of Certified Public
Accountant..................... 1
Balance Sheet, December 31, 1999
......................... 2
Statement of Operations, for the
Period April 2, 1999 (Inception)
Through December 31,
1999................................. 3
Statement of Stockholders= Equity
(Deficit), April 2, 1999 (Inception)
Through December 31,
1999................................. 4
Statement of Cash Flows for the
Period From April 2, 1999 (Inception)
Through December 31,1999
Notes to Financial
Statements............................ 6-7
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1777 S. Harrison Street, Suite 2100
Denver, Colorado 80210
(303) 782-0878
Board of Directors
Xunantunich, Inc.
21112 123rd Avenue
Maple Ridge, British Columbia V2X4B4
Canada
I have audited the accompanying Balance Sheet of
Xunantunich, Inc. (A Development Stage
Enterprise) as of December 31, 1999 and the
Statements of Operations, Stockholders= Equity,
and Cash Flows for the period April 2, 1999
(Inception) through December 31, 1999. My
examination was made in accordance with generally
accepted auditing standards, and accordingly,
included such tests of the accounting records and
such other auditing procedures as we consider
necessary in the circumstances.
In my opinion, the financial statements referred
to above present fairly accurately, in all
material respects, the financial position of
Xunantunich, Inc.(A Development Stage Enterprise)
as of December 31, 1999, and the results of its
operations and changes in its cash flows for the
period from April 2, 1999 (Inception) through
December 31, 1999, in conformity with generally
accepted accounting principles applied on a
consistent basis.
Janet Loss, C.P.A., P.C.
February 29, 2000
1
XUNANTUNICH, INC.
(A Development Stage Enterprise)
BALANCE SHEET
December 31, 1999
ASSETS
CURRENT ASSETS:
License Rights 2,000
TOTAL ASSETS 2,000
LIABILITIES AND STOCKHOLDERS= EQUITY
CURRENT LIABILITIES:
TOTAL CURRENT LIABILITIES 0
STOCKHOLDERS= EQUITY:
Common stock, $0.001 par
Value; 25,000,000 shares
Authorized, and 5,000,000 shares
Issued and outstanding 2,500
Additional Paid-In Capital
(Deficit) (534)
Total Stockholders= Equity (Deficit) 2,000
Total Liabilities and
Stockholders= Equity 2,000
The accompanying notes are an integral part of
the financial statements.
2
Xunantunich, Inc.
(A Development Stage Enterprise)
STATEMENT OF OPERATIONS
For the Period April 2, 1999 (Inception)
Through December 31, 1999
REVENUES: 0
OPERATING EXPENSES:
Fees 165
Taxes and Licenses 320
Office Expenses 49
TOTAL OPERATING EXPENSES 534
NET (LOSS) (534)
NET (LOSS) PER SHARE (0.0000)
Weighted Average Number of
Common Shares Outstanding 5,000,000
The accompanying notes are an integral part of the
financial statements.
3
XUNANTUNICH, INC.
(A Development Stage Enterprise)
STATEMENT OF STOCKHOLDERS= EQUITY (DEFICIT)
For the Period April 2, 1999
Through December 31, 1999
Deficit
Accumulated
Common Stock Additional During the Total
Number of Common Stock Paid-In Development stockholders
Shares Amount Capital Stage equity
(deficit)
April 2,1999 500000 500 34 0 534
issuance
of Common
Stock for Cash
Issuance of 2000000 2000 0 0 2000
Common Stock
For License
rights
Issuance of 2500000
Common Stock
on November
24, 1999 for
2-1 split
Deficit for 0 0 0 (534) (534)
the Period from
April 2, 1999
(Inception)
through
December 31,
1999
Balance 5000000 2500 34 (534) 2000
December 31,
1999
The accompanying notes are an integral part of the financial statements.
4
XUNANUTUNICH, INC.
(A Development Stage Enterprise)
STATEMENT OF CASH FLOWS
For the Period April 2, 1999 (Inception)
Through December 31, 1999
CASH FLOWS FROM (TO) OPERATING
ACTIVITIES:
Net Income (Loss) (534)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of License Rights (2,000)
CASH FLOWS FROM (TO) FINANCING ACTIVITIES:
Issuance of Common Stocks 2,534
Increase (Decrease) in Cash 0
CASH,BEGINNING OF PERIOD 0
CASH, END OF PERIOD 0
The accompanying notes are an integral part of
the financial statements.
5
XUNANTUNICH, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 1999
NOTE I B ORGANIZATION AND HISTORY
The Company is a Nevada Corporation and the
Company has been in the development stage since
its formation on April 2, 1999.
The Company=s only activities have been
organizational, directed at acquiring its
principle assets, raising its initial capital and
developing its business plan.
On April 2, 1999, XUNANTUNICH INC. issued 500,000
shares of common stock to the officers and
directors as founders' shares in return for the
time, effort and expenditures to organize and
form the corporation. On April 28, 1999
XUNANTUNICH INC. issued 2,000,000 shares of
common stockin return for the water treatment
rights for the states of Arizona and Nevada and
the development of the business plan.
On November 24, 1999 all 2,500,000 shares of
common stock of XUNANTUNICH INC. were purchased
by the present shareholders. They immediately
effected a two - to - one forward split for a
total of 5,000,000 issued and outstanding shares
NOTE II B SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
DEVELOPMENT STAGE ACTIVITIES
The Company has been in the development stage
since inception.
ACCOUNTING METHOD
The Company records income and expenses on the
accrual method.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents includes cash on hand,
cash on deposit, and highly liquid
investments with maturities generally of
three months or less. At December 31, 1999,
there were no cash equivalents.
6
XUNANTUNICH, INC.
(A Development Stage Company)
YEAR END
The Company has elected to have a fiscal year
ended December 31.
USE OF ESTIMATES
The preparation of financial statements in
accordance with generally accepted
accounting principles requires management to
make estimates and assumptions that effect
the reported amounts of assets and
liabilities at the date of financial
statements, as well as revenues and expenses
reported for the periods presented. The
Company regularly assesses these estimates
and, while actual results may differ
management believes that the estimates are
reasonable.
NOTE III B RELATED PARTY TRANSACTIONS
The Company has entered into an agreement made
effective April 5, 1999 with David R.
Mortenson & Associates (Grantor) to receive
the rights to distribute the products
developed by NW Technologies, Inc.
The Company agrees to pay the Grantor the sum of
$2,000 in the sum of 2,000,000 shares of
common stock having a par value of $0.001
per share.
7
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
There have been no changes in and/or disagreements
with Janet Loss, C.P.A., P.C. on accounting and
financial disclosure matters.
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to Nevada law, a corporation may indemnify a
person who is a party or threatened to be made a
party to an action, suit or proceeding by reason
of the fact that he or she is an officer,
director, employee or agent of the corporation,
against such person=s costs and expenses incurred
in connection with such action so long as he or
she has acted in good faith and in a manner which
he or she reasonably believed to be in, or not
opposed to, the best interests of the
corporation, and, in the case of criminal
actions, had no reasonable cause to believe his
or her conduct was unlawful. Nevada law requires
a corporation to indemnify any such person who is
successful on the merits or defense of such
action against costs and expenses actually and
reasonably incurred in connection with the
action.
The bylaws of XUNANTUNICH INC. filed as Exhibit 3.2,
provide that XUNANTUNICH INC. will indemnify its
officers and directors for costs and expenses
incurred in connection with the defense of
actions, suits, or proceedings against them on
account of their being or having been directors
or officers of XUNANTUNICH INC., absent a finding
of negligence or misconduct in office. The
Bylaws also permit XUNANTUNICH INC. to maintain
insurance on behalf of its officers, directors,
employees and agents against any liability
asserted against and incurred by that person
whether or not XUNANTUNICH INC. has the power to
indemnify such person against liability for any
of those acts.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Expenses incurred or (expected) relating to this
registration statement and distribution are as
follows:
Legal fees 8,500.00
Accounting 1,500.00
(Edgar filing and Printing) 5,000.00
TOTAL $15,000.00
RECENT SALES OF UNREGISTERED SECURITIES.
Set forth below is information regarding the
issuance and sales XUNANTUNICH INC. securities
without registration since its formation. No
such sales involved the use of an underwriter and
no commissions were paid in connection with the
sale of any securities.
(4) On April 2, 1999, XUNANTUNICH INC. issued
500,000 shares of common stock to the officers
and directors as founders' shares in return for
the time, effort and expenditures to organize and
form the corporation. On April 28, 1999
XUNANTUNICH INC. issued 200,000 shares of common
stock each to ten individuals for a total of
2,000,000 shares in return for the water
treatment rights for the states of Arizona and
Nevada and the development of the business plan.
(5) On August 17, 1999, the Board of Directors
of XUNANTUNICH INC. filed an amendment to its
Articles of Incorporation with the state of
Nevada increasing the authorized capital to
100,000,000 shares of common stock.
(6) On November 24, 1999 all 2,500,000 shares of
common stock of XUNANTUNICH INC. were purchased
by the present shareholders. They immediately
effected a two - to - one forward split for a
total of 5,000,000 issued and outstanding shares
See "Selling Security Holders" and "Security
Ownership of Certain Beneficial Owners and
Management".
Exhibits.
UNDERTAKINGS.
The undersigned registrant hereby
undertakes:
(1) To file, during any
period in which offers or sales are being
made, a post-effective amendment to this
registration statement:
(20) 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 the
registration statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the
registration statement. Notwithstanding
the foregoing, any increase or decrease
in volume of securities offered (if the
total dollar value of securities offered
would not exceed that which was
registered) and any deviation from the
low or high end of the estimated maximum
offering range may be reflected in the
form of prospectus filed with the
Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume
and price represent no more than 20%
change in the maximum aggregate offering
price set forth in the "Calculation of
Registration Fee" table in the effective
registration statement; and
(c) To include any
material information with respect to the
plan of distribution not previously
disclosed in the registration statement
or any material change to such
information in the registration
statement.
(2) That, for the purpose of
determining any liability under the
Securities Act of 1933, each such post-
effective amendment shall be deemed to be a
new registration statement relating to the
securities offered therein, and the offering
of such securities at that time shall be
deemed to be the initial bona fide offering
thereof.
(3) To remove from
registration by means of a post-effective
amendment any of the securities being registered,
which remain, unsold at the termination of the
offering.
That, for purposes of determining
any liability under the Securities
Act of 1933, each filing of the
registrant's annual report
pursuant to section 13(a) or
section 15(d) of the Securities
Exchange Act of 1934 that is
incorporated by reference in the
registration statement shall be
deemed to be a new registration
statement relating to the
securities offered therein, and
the offering of such securities at
that time shall be deemed to be
the initial bona fide offering
thereof.
Signatures
In accordance with the requirements of the
Securities Act of1933, the Registrant certifies
that it has reasonable grounds to believe that it
meets all of the Requirements for filing on Form
SB-2 and authorized this registration statement
To be signed on its behalf by the undersigned,
thereunto duly authorized, in the
City of Prince George, Province of British
Columbia Canada
On February 21, 2000
(Registrant) XUNANTUNICH INC.
By: ___/S/ MARK CRAMER____________
(Title) PRESIDENT
In accordance with the requirements of the
Securities Act of 1933, this
Registration statement has been signed by the
following persons in the
Capacities and on the dated stated.
By: ______/S/ FLORENCE CRAMER__
Title: ____SECRETARY/TREASURER_________
Date: _____February 28th, 2000
By: ____/S/MICHEAL CRAMER____________
Title: ___VISE PRESIDENT__________
Date: ___ February 28th, 2000____
21.
22.
23.
24.
25.
26.
27. EXHIBIT 3.2
28.
29.
30.
31.
32.
33.
34.
35.
1. 36.
37.
38. ARTICLES OF INCORPORATION
39.
40.
41.
42. Of
43.
44.
45.
46.
47.
48. XUNANTUNICH INC.
49.
50.
51.
52.
53.
54.
55.
56.
57. ARTICLES OF INCORPORATION
58.
59. of
60. XUNANTUNICH INC.
61. The undersigned natural person of the age of
eighteen years or more, acting as incorporator of
a corporation under and pursuant to the laws of
the State of Nevada, hereby adopts the following
Articles of Incorporation for such corporation:
62. ARTICLE I
63. The name of the corporation is XUNANTUNICH
INC.
64. ARTICLE II
65. The principal office of this corporation is
to be at 50 West Liberty Street #880, Reno,
89501, State of Nevada. The Nevada Agency and
Trust Company is hereby named as Resident Agent
of this corporation and in charge of its said
office in Nevada.
66. ARTICLE III
67. The nature of the business, objects and
purposes to be transacted, promoted, or carried
on by the corporation are:
68. A To conduct any lawful business, to
promote any lawful purpose, and to engage in any
lawful act or activity for which corporations
maybe organized under the General Corporation Law
of the State of Nevada and to act in every kind
of fiduciary capacity. and generally to do all
things necessary or convenient which are incident
to or which a natural person might or could do.
69. B To purchase, receive, take by grant,
gift, devise, bequest, or otherwise. lease, or
otherwise acquire, own, hold, improve, employ,
use and otherwise deal in and with real or
personal property, or any interest therein,
wherever situated, and to sell, convey, lease,
exchange, transfer or otherwise dispose of, or
mortgage or pledge, all or any of its property
and assets, or any interests therein, wherever
situated.
1. 70. C To engage generally in the real
estate business as principal, and in any lawful
capacity, and generally to take, lease, purchase,
or otherwise acquire, and to own, use, hold,
sell, convey, exchange, lease, mortgage, work,
clear, improve, develop, divide, and otherwise
handle, manage, operate, deal in and dispose of
mining claims, oil leases, oil and gas wells,
real estate, real property, lands, multiple-
dwelling structures, houses, buildings and other
works and any interest or right therein; to take,
lease, purchase or otherwise handle or acquire,
and to own, use, hold, sell, convey, exchange,
hire, lease, pledge, mortgage, and otherwise
handle, and deal in and dispose of, as principal
agent or in any lawful capacity, such personal
property, chattels, chattels real, rights,
easements, privileges, causes in action, notes,
bonds, mortgages, and securities as may lawfully
be acquired, held or disposed of and to acquire,
purchase, sell, assign, transfer, dispose of and
generally deal in and with as principal, agent,
broker, and in any lawful capacity, mortgages and
other interests in real, personal, and mixed
properties; to carry on a general oil
exploration, mining exploration and management
business as principal, agent, representative,
contractor, sub-contractor, and in any other
lawful capacity. To manufacture, purchase or
acquire in any lawful manner and to hold, own,
mortgage, pledge, sell, transfer, or in any
manner dispose of, and to deal and trade in
goods, wares, merchandise, and property of any
and every class and description, and in any part
of the world.
71. D To apply for, register, obtain,
purchase, lease, take licenses in respect of or
otherwise acquire, and to hold, own, use,
operate, develop, enjoy, turn to account, grant
licenses and immunities in respect of,
manufacture under and to introduce, sell, assign,
mortgage, pledge or otherwise dispose of and, in
any manner deal with and contract with reference
to:
72. Inventions, devices, formulas, processes,
improvements and modifications thereof;
73. Letters patent, patent rights, patented
processes, rights, designs, and similar rights,
trademarks, trade names, trade symbols and other
indications or origin and ownership granted by or
recognized under the laws of the United States of
America, any state or subdivision thereof, and
any commonwealth, territory, possession,
dependency, colony, possession agency or
instrumentality of the United States of America
and of any foreign country, and all rights
connected therewith or appertaining thereto.
3. Franchises licenses, grants and
concessions.
E To make, enter into, perform and carry
out contracts of every kind and description with
any person, firm, association, corporation or
government or agency or instrumentality thereof.
F To lend money in furtherance of its
corporate purposes and to invest and reinvest its
funds from time to time to such extent, to such
persons, firms, associations, corporations,
governments or agencies or instrumentality
thereof, and on such terms and on such security,
if any, as the Board of Directors of the
corporation may determine and direct any officer
to complete.
G To borrow money without limit as to
amount and at such rates of interest as it may
determine; from time to time to issue and sell
its own securities, including its shares of
stock, notes, bonds, debentures, and other
obligations, in such amounts, on such terms and
conditions, for such purposes and for such
prices, now or hereafter permitted by the laws of
the State of Nevada and by the Board of Directors
of the corporation as they may determine; and to
secure any of its obligations by mortgage, pledge
or other encumbrance of any or all of its
property, franchises and income.
H To be a promoter or manager of other
corporations of any type or kind; and to
participate with others in any corporation,
partnership, limited partnership, joint venture,
or other association of any kind, or in any
transaction, undertaking or arrangement which the
corporation would have power to conduct by
itself, whether or not such participation
involves sharing or delegation of control with or
to others.
I To promote and exercise all or any
part of the foregoing purposes and powers in and
all parts of the world, and to conduct its
business in all or any branches in any lawful
capacity.
The foregoing enumeration of specific
purposes and powers shall not be held to limit or
restrict in any manner the purposes and powers of
the corporation by references to or inference
from the terms or provisions of any other clause,
but shall be regarded as independent purposes.
ARTICLE IV
The aggregate number of shares, which the
corporation shall have authority to issue, is
10,000,000 shares of common stock with $0.001 par
value each.
No shareholder of the corporation shall have
the right of cumulative voting at any election of
directors or upon any other matter.
No holder of securities of the corporation
shall be entitled as a matter of right,
preemptive or otherwise, to subscribe for or
purchase any securities of the corporation now or
hereafter authorized to be issued, or securities
held in the treasury of the corporation, whether
issued or sold for cash or other consideration or
as a share dividend or otherwise. Any such
securities may be issued or disposed of by the
board of directors to such persons and on such
terms as in its discretion it shall deem
advisable.
ARTICLE V
Any action required to, or that may, be
taken at any annual or special meeting of
shareholders may be taken without a meeting,
without prior notice and without a vote, if a
consent or consents in writing, setting forth the
action so taken, shall be signed by the holder or
holders of shares having not less than the
minimum number of votes that would be necessary
to take such action at a meeting at which the
holders of all shares entitled to vote on the
action were present and voted.
ARTICLE VI
The members of the governing board shall be
styled DIRECTORS and the number of such Directors
shall be not less than one (l), or more than five
(5). The first board of directors shall be Two
Members whose names and post office addresses are
as follows:
Mr. John T. Bauska
2302 Hwy 2 East, Suite 4
Kalispell, Montana 59901
Mr. David R. Mortenson
P.O. Box 5034
Alvin, Texas 77512
ARTICLE VII
The initial number of stockholders will be
two (2). Additional stockholders may be obtained.
The number of directors may be changed as
provided in N.R.S. 78.330.
ARTICLE VIII
A. No director of the corporation shall be
liable to the corporation or any of its
shareholders for monetary damages for an act or
omission in the director's capacity as a
director, except that this Article VIII shall not
authorize the elimination or limitation of
liability of a director of the corporation to the
extent the director is found liable for: (i) a
breach of such director's duty of loyalty to the
corporation or its shareholders; (ii) an act or
omission not in good faith that constitutes a
breach of duty of such director to the
corporation or an act or omission that involves
intentional misconduct or a knowing violation of
the law; (iii) a transaction from which such
director received an improper benefit, whether or
not the benefit resulted from an action taken
within the scope of the director's office; or
(iv) an act or omission for which the liability
of a director is expressly provided by an
applicable statute.
B. The capital stock of this corporation
after the amount of the subscription price or par
value has been paid in, shall not be subject to
assessment to pay debts of this corporation and
no stock issued as fully paid up shall ever be
assessable or assessed and the Articles of
Incorporation shall not be amended in this
particular.
ARTICLE IX
This corporation is to have perpetual
existence.
David R. Mortenson, the undersigned, being
the original incorporator for the purpose of
forming a corporation to do business both within
and without the state of Nevada, and in pursuance
of the General Corporation Law of the State of
Nevada, effective March 31, 1925 and as
subsequently amended do make and file this
certificate, hereby declaring and certifying that
the facts herein above stated are true.
2nd day of April, 2000.
Address: P.O. Box 5034
Alvin, TX 77512
EXHIBIT 3.3
BYLAWS
XUNANTUNICH, INC.
BYLAWS OF
XUNANTUNICH INC.
CONTENTS OF INITIAL BYLAWS
ARTICLE PAGE
1.00 CORPORATE CHARTER AND BYLAWS
1.01 Corporate Charter Provisions 4
1.02 Registered Agent or Office Requirement
of Filing Changes with Secretary of State 4
1.03 Initial Business Office 4
1.04 Amendment of Bylaws 4
2.00 DIRECTORS AND DIRECTORS' MEETINGS
2.01 Action Without Meeting 5
2.02 Telephone Meetings 5
2.03 Place of Meetings 5
2.04 Regular Meetings 5
2.05 Call of Special Meeting 5
2.06 Quorum 6
2.07 Adjournment Notice of Adjourned
Meetings 6
2.08 Conduct of Meetings 6
2.09 Powers of the Board of Directors 6
2.10 Board Committees Authority to Appoint 7
2.11 Transactions with Interested Directors 7
2.12 Number of Directors 7
2.13 Term of Office 7
2.14 Removal of Directors 8
2.15 Vacancies 8
2.15(a) Declaration of Vacancy 8
2.15(b) Filling Vacancies by Directors 8
2.15(c) Filling Vacancies by Shareholders 8
2.16 Compensation 9
2.17 Indemnification of Directors and
Officers 9
2.18 Insuring Directors, Officers, and
Employees 9
ARTICLE PAGE
3.00SHAREHOLDERS' MEETINGS
3.01Action Without Meeting 9
3.02Telephone Meetings 10
3.03Place of Meetings 10
3.04Notice of Meetings 10
3.04Voting List 10
3.05Votes per Share 11
3.07Cumulative Voting 11
3.08Proxies 11
3.09Quorum 12
3.09(a) Quorum of Shareholders 12
3.09(b) Adjourn for Lack or Loss of Quorum
12
3.10Voting by Voice or Ballot 12
3.11Conduct of Meetings 12
3.12Annual Meetings 12
3.13Failure to Hold Annual Meeting 13
3.14Special Meetings 13
4.00OFFICERS
4.01Title and Appointment 13
4.01(a) Chairman 13
4.01(b) President 14
4.01(c) Vice President 14
4.01(d) Secretary 14
4.01(e) Treasurer 15
4.01(f) Assistant Secretary or
Assistant Treasurer15
4.02Removal and Resignation 15
4.03Vacancies 16
4.04Compensation 16
5.00AUTHORITY TO EXECUTE INSTRUMENTS
5.01No Authority Absent Specific
Authorization 16
5.02Execution of Certain Instruments 16
6.00ISSUANCE AND TRANSFER OF SHARES
6.01Classes and Series of Shares 17
6.02Certificates for Fully Paid Shares 17
6.03Consideration for Shares 17
6.04Replacement of Certificates 17
6.05Signing Certificates Facsimile
Signatures 18
6.06Transfer Agents and Registrars 18
6.07Conditions of Transfer 18
6.08Reasonable Doubts as to Right to
Transfer 18
ARTICLE PAGE
7.00CORPORATE RECORDS AND
ADMINISTRATION
7.01Minutes of Corporate
Meetings 18
7.02Share Register 19
7.03Corporate Seal 19
7.04Books of Account 19
7.05Inspection of Corporate
Records 20
7.06Fiscal Year 20
7.07Waiver of Notice 20
8.00ADOPTION OF INITIAL
BYLAWS 20
ARTICLE ONE CORPORATE CHARTER AND BYLAWS
1.01 CORPORATE CHARTER PROVISIONS
The Corporation's Charter authorizes ten
million (10,000,000) shares to be issued. The
officers and transfer agents issuing shares of
the Corporation shall ensure that the total
number of shares outstanding at any given time
does not exceed this number. Such officers and
agents shall advise the Board at least annually
of the authorized shares remaining available to
be issued. No shares shall be issued for less
than the par value stated in the Charter. Each
Charter provision shall be observed until amended
by Restated Articles or Articles of Amendment
duly filed with the Secretary of State.
1.02 REGISTERED AGENT AND OFFICEBREQUIREMENT
OF FILING CHANGES WITH SECRETARY OF STATE
The address of the Registered Office
provided in the Articles of Incorporation, as
duly filed with the Secretary of State for the
State of Nevada, is: 50 West Liberty Street,
Suite 880, Reno, Nevada 89501.
The name of the Registered Agent of the
Corporation at such address, as set forth in its
Articles of Incorporation, is: Nevada Agency and
Trust Company.
The Registered Agent or Office may be
changed by filing a Statement of Change of
Registered Agent or Office or Both with the
Secretary of State, and not otherwise. Such
filing shall be made promptly with each change.
Arrangements for each change in Registered Agent
or Office shall ensure that the Corporation is
not exposed to the possibility of a default
judgment. Each successive Registered Agent shall
be of reliable character and well informed of the
necessity of immediately furnishing the papers of
any lawsuit against the Corporation to its
attorneys.
1.03 INITIAL BUSINESS OFFICE
The address of the initial principal
business office of the Corporation is hereby
established as: 2400 Loop 35 #1502, Alvin, Texas
77511.
The Corporation may have additional business
offices within the State of Nevada and where it
may be duly qualified to do business outside of
Nevada, as the Board of Directors may from time
to time designate or the business of the
Corporation may require.
1.04 AMENDMENT OF BYLAWS
The Shareholders or Board of Directors,
subject to any limits imposed by the
Shareholders, may amend or repeal these Bylaws
and adopt new Bylaws. All amendments shall be
upon advice of counsel as to legality, except in
emergency. Bylaw changes shall take effect upon
adoption unless otherwise specified. Notice of
Bylaws changes shall be given in or before notice
given of the first Shareholders' meeting
following their adoption.
ARTICLE TWO DIRECTORS AND DIRECTORS'
MEETINGS
2.01 ACTION BY CONSENT OF BOARD WITHOUT
MEETING
Any action required or permitted to be taken
by the Board of Directors may be taken without a
meeting, and shall have the same force and effect
as a unanimous vote of Directors, if all members
of the Board consent in writing to the action.
Such consent may be given individually or
collectively.
2.02 TELEPHONE MEETINGS
Subject to the notice provisions required by
these Bylaws and by the Business Corporation Act,
Directors may participate in and hold a meeting
by means of conference call or similar
communication by which all persons participating
can hear each other. Participation in such a
meeting shall constitute presence in person at
such meeting, except participation for the
express purpose of objecting to the transaction
of any business on the ground that the meeting is
not lawfully called or convened.
2.03 PLACE OF MEETINGS
Meetings of the Board of Directors shall be
held at the business office of the Corporation or
at such other place within or without the State
of Nevada as may be designated by the Board.
2.04 REGULAR MEETINGS
Regular meetings of the Board of Directors
shall be held, without call or notice,
immediately following each annual Shareholders'
meeting, and at such other regularly repeating
times as the Directors may determine.
2.05 CALL OF SPECIAL MEETING
Special meetings of the Board of Directors
for any purpose may be called at any time by the
President or, if the President is absent or
unable or refuses to act, by any Vice President
or any two Directors. Written notices of the
special meetings, stating the time and place of
the meeting, shall be mailed ten days before, or
telegraphed or personally delivered so as to be
received by each Director not later than two days
before, the day appointed for the meeting. Notice
of meetings need not indicate an agenda.
Generally, a tentative agenda will be included,
but the meeting shall not be confined to any
agenda included with the notice.
Meetings provided for in these Bylaws shall
not be invalid for lack of notice if all persons
entitled to notice consent to the meeting in
writing or are present at the meeting and do not
object to the notice given. Consent may be given
either before or after the meeting.
Upon providing notice, the Secretary or
other officer sending notice shall sign and file
in the Corporate Record Book a statement of the
details of the notice given to each Director. If
such statement should later not be found in the
Corporate Record Book, due notice shall be
presumed.
2.06 QUORUM
The presence throughout any Directors'
meeting, or adjournment thereof, of a majority of
the authorized number of Directors shall be
necessary to constitute a quorum to transact any
business, except to adjourn. If a quorum is
present, every act done or resolution passed by a
majority of the Directors present and voting
shall be the act of the Board of Directors.
2.07 ADJOURNMENT AND NOTICE OF ADJOURNED
MEETINGS
A quorum of the Directors may adjourn any
Directors' meeting to meet again at a stated hour
on a stated day. Notice of the time and place
where an adjourned meeting will be held need not
be given to absent Directors if the time and
place is fixed at the adjourned meeting. In the
absence of a quorum, a majority of the Directors
present may adjourn to a set time and place if
notice is duly given to the absent members, or
until the time of the next regular meeting of the
Board.
2.08 CONDUCT OF MEETINGS
At every meeting of the Board of Directors,
the Chairman of the Board, if there is such an
officer, and if not, the President, or in the
President's absence, a Vice President designated
by the President, or in the absence of such
designation, a Chairman chosen by a majority of
the Directors present, shall preside. The
Secretary of the Corporation shall act as
Secretary of the Board of Directors' meetings.
When the Secretary is absent from any meeting,
the Chairman may appoint any person to act as
Secretary of that meeting.
2.09 POWERS OF THE BOARD OF DIRECTORS
The business and affairs of the Corporation
and all corporate powers shall be exercised by or
under authority of the Board of Directors,
subject to limitations imposed by law, the
Articles of Incorporation, any applicable
Shareholders' agreement, and these Bylaws.
2.10 BOARD COMMITTEESBAUTHORITY TO APPOINT
The Board of Directors may designate an
executive committee and one or more other
committees to conduct the business and affairs of
the Corporation to the extent authorized. The
Board shall have the power at any time to change
the powers and membership of, fill vacancies in,
and dissolve any committee. Members of any
committee shall receive such compensation as the
Board of Directors may from time to time provide.
The designation of any committee and the
delegation of authority thereto shall not operate
to relieve the Board of Directors, or any member
thereof, of any responsibility imposed by law.
2.11 TRANSACTIONS WITH INTERESTED DIRECTORS
Any contract or other transaction between
the Corporation and any of its Directors (or any
corporation or firm in which any of its Directors
are directly or indirectly interested) shall be
valid for all purposes notwithstanding the
presence of that Director at the meeting during
which the contract or transaction was authorized,
and notwithstanding the Directors' participation
in that meeting. This section shall apply only if
the contract or transaction is just and
reasonable to the Corporation at the time it is
authorized and ratified, the interest of each
Director is known or disclosed to the Board of
Directors, and the Board nevertheless authorizes
or ratifies the contract or transaction by a
majority of the disinterested Directors present.
Each interested Director is to be counted in
determining whether a quorum is present, but
shall not vote and shall not be counted in
calculating the majority necessary to carry the
vote. This section shall not be construed to
invalidate contracts or transactions that would
be valid in its absence.
2.12 NUMBER OF DIRECTORS
The number of Directors of this Corporation
shall be no more than five (5) or less than one
(1). No Director need be a resident of Nevada or
a Shareholder. The number of Directors may be
increased or decreased from time to time by
amendment to these Bylaws. Any decrease in the
number of Directors shall not have the effect of
shortening the tenure, which any incumbent
Director would otherwise enjoy.
2.13 TERM OF OFFICE
Directors shall be entitled to hold office
until their successors are elected and qualified.
Election for all Director positions, vacant or
not vacant, shall occur at each annual meeting of
the Shareholders and may be held at any special
meeting of Shareholders called specifically for
that purpose.
2.14 REMOVAL OF DIRECTORS
The entire Board of Directors or any
individual Director may be removed from office by
a vote of Shareholders holding a majority of the
outstanding shares entitled to vote at an
election of Directors. However, if less than the
entire Board is to be removed, no one of the
Directors may be removed if the votes cast
against his removal would be sufficient to elect
him if then cumulatively voted at an election of
the entire Board of Directors. No director may be
so removed except at an election of the class of
Directors of which he is a part. If any or all
Directors are so removed, new Directors may be
elected at the same meeting. Whenever a class or
series of shares is entitled to elect one or more
Directors under authority granted by the Articles
of Incorporation, the provisions of this
Paragraph apply to the vote of that class or
series and not to the vote of the outstanding
shares as a whole.
2.15 VACANCIES
Vacancies on the Board of Directors shall
exist upon the occurrence of any of the following
events: (a) the death, resignation, or removal of
any Director; (b) an increase in the authorized
number of Directors; or (c) the failure of the
Shareholders to elect the full authorized number
of Directors to be voted for at any annual,
regular, or special Shareholders' meeting at
which any Director is to be elected.
2.15(a) DECLARATION OF VACANCY
A majority of the Board of Directors may
declare vacant the office of a Director if the
Director: (a) is adjudged incompetent by a court
order; (b) is convicted of a crime involving
moral turpitude; (c) or fails to accept the
office of Director, in writing or by attending a
meeting of the Board of Directors, within thirty
(30) days of notice of election.
2.15(b) FILLING VACANCIES BY DIRECTORS
Vacancies other than those caused by an
increase in the number of Directors may be filled
temporarily by majority vote of the remaining
Directors, though less than a quorum, or by a
sole remaining Director. Each Director so elected
shall hold office until a qualified successor is
elected at a Shareholders' meeting.
2.15(c) FILLING VACANCIES BY SHAREHOLDERS
Any vacancy on the Board of Directors,
including those caused by an increase in the
number of Directors shall be filled by the
Shareholders at the next annual meeting or at a
special meeting called for that purpose. Upon the
resignation of a Director tendered to take effect
at a future time, the Board or the Shareholders
may elect a successor to take office when the
resignation becomes effective.
2.16 COMPENSATION
Directors shall receive such compensation
for their services as Directors as shall be
determined from time to time by resolution of the
Board. Any Director may serve the Corporation in
any other capacity as an officer, agent,
employee, or otherwise, and receive compensation
therefor.
2.17 INDEMNIFICATION OF DIRECTORS AND
OFFICERS
The Board of Directors shall authorize the
Corporation to pay or reimburse any present or
former Director or officer of the Corporation any
costs or expenses actually and necessarily
incurred by that officer in any action, suit, or
proceeding to which the officer is made a party
by reason of holding that position, provided,
however, that no officer shall receive such
indemnification if finally adjudicated therein to
be liable for negligence or misconduct in office.
This indemnification shall extend to good-faith
expenditures incurred in anticipation of
threatened or proposed litigation. The Board of
Directors may in proper cases, extend the
indemnification to cover the good-faith
settlement of any such action, suit, or
proceeding, whether formally instituted or not.
2.18 INSURING DIRECTORS, OFFICERS, AND
EMPLOYEES
The Corporation may purchase and maintain
insurance on behalf of any Director, officer,
employee, or agent of the Corporation, or on
behalf of any person serving at the request of
the Corporation as a Director, officer, employee,
or agent of another corporation, partnership,
joint venture, trust, or other enterprise,
against any liability asserted against that
person and incurred by that person in any such
corporation, whether or not the Corporation has
the power to indemnify that person against
liability for any of those acts.
ARTICLE THREEBSHAREHOLDERS' MEETINGS
3.01 ACTION WITHOUT MEETING
Any action that may be taken at a meeting of
the Shareholders under any provision of the
Nevada Business Corporation Act may be taken
without a meeting if authorized by a consent or
waiver filed with the Secretary of the
Corporation and signed by all persons who would
be entitled to vote on that action at a
Shareholders' meeting. Each such signed consent
or waiver, or a true copy thereof, shall be
placed in the Corporate Record Book.
3.02 TELEPHONE MEETINGS
Subject to the notice provisions required by
these Bylaws and by the Business Corporation Act,
Shareholders may participate in and hold a
meeting by means of conference call or similar
communication by which all persons participating
can hear each other. Participation in such a
meeting shall constitute presence in person at
such meeting, except participation for the
express purpose of objecting to the transaction
of any business on the ground that the meeting is
not lawfully called or convened.
3.03 PLACE OF MEETINGS
Shareholders' meetings shall be held at the
business office of the Corporation, or at such
other place within or without the State of Nevada
as may be designated by the Board of Directors or
the Shareholders.
3.04 NOTICE OF MEETINGS
The President, the Secretary, or the officer
or persons calling a Shareholders' Meeting. shall
give notice, or cause it to be given, in writing
to each Director and to each Shareholder entitled
to vote at the meeting at least ten (10) but not
more than sixty (60) days before the date of the
meeting. Such notice shall state the place, day,
and hour of the meeting, and, in case of a
special meeting, the purpose or purposes for
which the meeting is called. Such written notice
may be given personally, by mail, or by other
means. Such notice shall be addressed to each
recipient at such address as appears on the Books
of the Corporation or as the recipient has given
to the Corporation for the purpose of notice.
Meetings provided for in these Bylaws shall not
be invalid for lack of notice if all persons
entitled to notice consent to the meeting in
writing or are present at the meeting in person
or by proxy and do not object to the notice
given, Consent may be given either before or
after the meeting. Notice of the reconvening of
an adjourned meeting is not necessary unless the
meeting is adjourned more than thirty days past
the date stated in the notice, in which case
notice of the adjourned meeting shall be given as
in the case of any special meeting. Notice may be
waived by written waivers signed either before or
after the meeting by all persons entitled to the
notice.
3.05 VOTING LIST
At least ten (10), but not more than sixty
(60), days before each Shareholders' meeting, the
officer or agent having charge of the
Corporation's share transfer books shall make a
complete list of the Shareholders entitled to
vote at that meeting or any adjournment thereof,
arranged in alphabetical order, with the address
and the number of shares held by each. The list
shall be kept on file at the Registered Office of
the Corporation for at least ten (10) days prior
to the meeting, and shall be subject to
inspection by any Director, officer, or
Shareholder at any time during usual business
hours. The list shall also be produced and kept
open at the time and place of the meeting and
shall be subject, during the whole time of the
meeting, to the inspection of any Shareholder.
The original share transfer books shall be prima
facie evidence as to the Shareholders entitled to
examine such list or transfer books or to vote at
any meeting of Shareholders. However, failure to
prepare and to make the list available in the
manner provided above shall not affect the
validity of any action taken at the meeting.
3.06 VOTES PER SHARE
Each outstanding share, regardless of class,
shall be entitled to one (1) vote on each matter
submitted to a vote at a meeting of Shareholders,
except to the extent that the voting rights of
the shares of any class or classes are limited or
denied pursuant to the Articles of Incorporation.
A Shareholder may vote in person or by proxy
executed in writing by the Shareholder, or by the
Shareholder's duly authorized attorney-in-fact.
3.07 CUMULATIVE VOTING
Subject to any limitation stated in the
Articles of Incorporation, every Shareholder
entitled to vote at any election of Directors may
cumulate votes. For this purpose, each
Shareholder shall have a number of votes equal to
the number of Directors to be elected multiplied
by the number of votes to which the Shareholder's
shares are entitled. The Shareholder may cast all
these votes for one candidate or may distribute
the votes among any number of candidates. The
candidates receiving the highest number of votes
are elected, up to the number of vacancies to be
filled. No Shareholder may cumulate votes unless
that Shareholder gives written notice of his or
her intention to do so to the Secretary of the
Corporation on or before the day preceding the
election at which the votes will be cumulated. If
any Shareholder gives written notice as provided
above, all Shareholders may cumulate their votes.
3.08PROXIES
A Shareholder may vote either in person or by
proxy executed in writing by the Shareholder or
his or her duly authorized attorney in fact.
Unless otherwise provided in the proxy or by law,
each proxy shall be revocable and shall not be
valid after eleven (11) months from the date of
its execution,
3.09QUORUM
3.09(a) QUORUM OF SHAREHOLDERS
As to each item of business to be voted on,
the presence (in person or by proxy) of the
persons who are entitled to vote a majority of
the outstanding voting shares on that matter
shall constitute the quorum necessary for the
consideration of the matter at a Shareholders'
meeting. The vote of the holders of a majority of
the shares entitled to vote on the matter and
represented at a meeting at which a quorum is
present shall be the act of the Shareholders'
meeting.
3.09(b) ADJOURNMENT FOR LACK OR LOSS OF
QUORUM
No business may be transacted in the absence
of a quorum, or upon the withdrawal of enough
Shareholders to leave less than a quorum; other
than to adjourn the meeting from time to time by
the vote of a majority of the shares represented
at the meeting.
3.10VOTING BY VOICE OR BALLOT
Elections for Directors need not be by ballot
unless a Shareholder demands election by ballot
before the voting begins.
3.11CONDUCT OF MEETINGS
Meetings of the Shareholders shall be chaired
by the President, or, in the President's absence,
a Vice President designated by the President, or,
in the absence of such designation, any other
person chosen by a majority of the Shareholders
of the Corporation present in person or by proxy
and entitled to vote. The Secretary of the
Corporation, or, in the Secretary's absence, an
Assistant Secretary, shall act as Secretary of
all meetings of the Shareholders. In the absence
of the Secretary or Assistant Secretary, the
Chairman shall appoint another person to act as
Secretary of the meeting.
3.12ANNUAL MEETINGS
The time, place, and date of the annual
meeting of the Shareholders of the Corporation,
for the purpose of electing Directors and for the
transaction of any other business as may come
before the meeting, shall be set from time to
time by a majority vote of the Board of
Directors. If the day fixed for the annual
meeting shall be on a legal holiday in the State
of Nevada, such meeting shall be held on the next
succeeding business day. If the election of
Directors is not held on the day thus designated
for any annual meeting, or at any adjournment
thereof, the Board of Directors shall cause the
election to be held at a special meeting of the
Shareholders as soon thereafter as possible.
3.13FAILURE TO HOLD ANNUAL MEETING
If, within any 13-month period, an annual
Shareholders' Meeting is not held, any
Shareholder may apply to a court of competent
jurisdiction in the county in which the principal
office of the Corporation is located for a
summary order that an annual meeting be held.
3.14 SPECIAL MEETINGS
A special Shareholders' meeting may be called
at any time by. (a) the President; (b) the Board
of Directors; or (c) one or more Shareholders
holding in the aggregate one-tenth or more of all
the shares entitled to vote at the meeting. Such
meeting may be called for any purpose. The party
calling the meeting may do so only by written
request sent by registered mail or delivered in
person to the President or Secretary. The officer
receiving the written request shall within ten
(10) days from the date of its receipt cause
notice of the meeting to be sent to all the
Shareholders entitled to vote at such a meeting.
If the officer does not give notice of the
meeting within ten (10) days after the date of
receipt of the written request, the person or
persons calling the meeting may fix the time of
the meeting and give the notice. The notice shall
be sent pursuant to Section 3.04 of these Bylaws.
The notice of a special Shareholders' meeting
must state the purpose or purposes of the meeting
and, absent consent of every Shareholder to the
specific action taken, shall be limited to
purposes plainly stated in the notice,
notwithstanding other provisions herein.
ARTICLE FOURBOFFICERS
4.01TITLE AND APPOINTMENT
The officers of the Corporation shall be a
President and a Secretary, as required by law.
The Corporation may also have, at the discretion
of the Board of Directors, a Chairman of the
Board, one or more Vice Presidents, a Treasurer,
one or more Assistant Secretaries, and one or
more Assistant Treasurers. One person may hold
any two or more offices, including President and
Secretary. All officers shall be elected by and
hold office at the pleasure of the Board of
Directors, which shall fix the compensation and
tenure of all officers.
4.01(a) CHAIRMAN OF THE BOARD
The Chairman, if there shall be such an
officer, shall, if present, preside at the
meetings of the Board of Directors and exercise
and perform such other powers and duties as may
from time to time be assigned to the Chairman by
the Board of Directors or prescribed by these
Bylaws.
4.01(b) PRESIDENT
Subject to such supervisory powers, if any,
as may be given to the Chairman, if there is one,
by the Board of Directors, the President shall be
the chief executive officer of the Corporation
and shall, subject to the control of the Board of
Directors, have general supervision, direction,
and control of the business and officers of the
Corporation. The President shall have the general
powers and duties of management usually vested in
the office of President of a corporation; shall
have such other powers and duties as may be
prescribed by the Board of Directors or the
Bylaws; and shall be ex officio a member of all
standing committees, including the executive
committee, if any. In addition, the President
shall preside at all meetings of the Shareholders
and in the absence of the Chairman, or if there
is no Chairman, at all meetings of the Board of
Directors.
4.01(c) VICE PRESIDENT
Any Vice President shall have such powers and
perform such duties as from time to time may be
prescribed by these Bylaws, by the Board of
Directors, or by the President. In the absence or
disability of the President, the senior or duly
appointed Vice President, if any, shall perform
all the duties of the President, pending action
by the Board of Directors when so acting, such
Vice President shall have all the powers of, and
be subject to all the restrictions on, the
President.
4.01(d) SECRETARY
The Secretary shall:
A. See that all notices are duly given in
accordance with the provisions of these Bylaws
and as required by law. In case of the absence or
disability of the Secretary. or the Secretary's
refusal or neglect to act, notice may be given
and served by an Assistant Secretary or by the
Chairman, the President, any Vice President, or
by the Board of Directors.
B. Keep the minutes of corporate meetings,
and the Corporate Record Book, as set out in
Section 7.01 hereof.
C. Maintain, in the Corporate Record Book,
a record of all share certificates issued or
canceled and all shares of the Corporation
canceled or transferred.
D. Be custodian of the Corporation's
records and of any seal, which the Corporation
may from time to time adopt. when the Corporation
exercises its right to use a seal, the Secretary
shall see that the seal is embossed on all share
certificates prior to their issuance and on all
documents authorized to be executed under seal in
accordance with the provisions of these Bylaws.
E. In general, perform all duties incident
to the office of Secretary, and such other duties
as from time to time may be required by Sections
7.01, 7.02, and 7.03 of these Bylaws, by these
Bylaws generally, by the Board of Directors, or
by the President.
4.01(e) TREASURER
The Treasurer shall:
F. Have charge and custody of, and be
responsible for, all funds and securities of the
Corporation, and deposit all funds in the name of
the Corporation in those banks, trust companies,
or other depositories that shall be selected by
the Board of Directors.
G. Receive, and give receipt for, monies
due and payable to the Corporation.
H. Disburse or cause to be disbursed the
funds of the Corporation as may be directed by
the Board of Directors, taking proper vouchers
for those disbursements.
I. If required by the Board of Directors or
the President, give to the Corporation a bond to
assure the faithful performance of the duties of
the Treasurer's office and the restoration to the
Corporation of all corporate books, papers,
vouchers, money, and other property of whatever
kind in the Treasurer's possession or control, in
case of the Treasurer's death, resignation,
retirement, or removal from office. Any such bond
shall be in a sum satisfactory to the Board of
Directors, with one or more sureties or a surety
company satisfactory to the Board of Directors.
J. In general, perform all the duties
incident to the office of Treasurer and such
other duties as from time to time may be assigned
to the Treasurer by Sections 7.O4 and 7.05 of
these Bylaws, by these Bylaws generally, by the
Board of Directors, or by the President.
4.01(f) ASSISTANT SECRETARY AND ASSISTANT
TREASURER
The Assistant Secretary or Assistant
Treasurer shall have such powers and perform such
duties as the Secretary or Treasurer,
respectively, or as the Board of Directors or
President may prescribe. In case of the absence
of the Secretary or Treasurer, the senior
Assistant Secretary or Assistant Treasurer,
respectively, may perform all of the functions of
the Secretary or Treasurer.
4.02REMOVAL AND RESIGNATION
Any officer may be removed, either with or
without cause, by vote of a majority of the
Directors at any regular or special meeting of
the Board, or, except in case of an officer
chosen by the Board of Directors, by any
committee or officer upon whom that power of
removal may be conferred by the Board of
Directors. Such removal shall be without
prejudice to the contract rights, if any, of the
person removed. Any officer may resign at any
time by giving written notice to the Board of
Directors, the President, or the Secretary of the
Corporation. Any resignation shall take effect on
the date of the receipt of that notice or at any
later time specified therein, and, unless
otherwise specified therein, the acceptance of
that resignation shall not be necessary to make
it effective.
4.03VACANCIES
Upon the occasion of any vacancy occurring in
any office of the Corporation, by reason of
death, resignation, removal, or otherwise, the
Board of Directors may elect an acting successor
to hold office for the unexpired term or until a
permanent successor is elected.
4.04COMPENSATION
The compensation of the officers shall be
fixed from time to time by the Board of
Directors, and no officer shall be prevented from
receiving a salary by reason of the fact that the
officer is also a Shareholder or a Director of
the Corporation, or both.
ARTICLE FIVEBAUTHORITY TO EXECUTE INSTRUMENTS
5.01NO AUTHORITY ABSENT SPECIFIC
AUTHORIZATION
These Bylaws provide certain authority for
the execution of instruments. The Board of
Directors, except as otherwise provided in these
Bylaws, may additionally 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. Unless expressly authorized
by these Bylaws or the Board of Directors, no
officer, agent, or employee shall have any power
or authority to bind the Corporation by any
contract or engagement nor to pledge its credit
nor to render it peculiarly liable for any
purpose or in any amount.
5.02 EXECUTION OF CERTAIN INSTRUMENTS
Formal contracts of the Corporation,
promissory notes, deeds, deeds of trust,
mortgages, pledges, and other evidences of
indebtedness of the Corporation, other corporate
documents, and certificates of ownership of
liquid assets held by the Corporation shall be
signed or endorsed by the President or any Vice
President and by the Secretary or the Treasurer,
unless otherwise specifically determined by the
Board of Directors or otherwise required by law.
ARTICLE SIX-ISSUANCE AND TRANSFER OF SHARES
6.01 CLASSES AND SERIES OF SHARES
The Corporation may issue one or more classes
or series of shares, or both. Any of these
classes or series may have full, limited, or no
voting rights, and may have such other
preferences, rights, privileges, and restrictions
as are stated or authorized in the Articles of
Incorporation. All shares of any one class shall
have the same voting, conversion, redemption, and
other rights, preferences, privileges, and
restrictions, unless the class is divided into
series, If a class is divided into series, all
the shares of any one series shall have the same
voting, conversion, redemption, and other.
rights, preferences, privileges, and
restrictions. There shall always be a class or
series of shares outstanding that has complete
voting rights except as limited or restricted by
voting rights conferred on some other class or
series of outstanding shares.
6.02CERTIFICATES FOR FULLY PAID SHARES
Neither shares nor certificates representing
shares may be issued by the Corporation until the
full amount of the consideration has been
received when the consideration has been paid to
the Corporation, the shares shall be deemed to
have been issued and the certificate representing
the shares shall be issued to the shareholder.
6.03CONSIDERATION FOR SHARES
Shares may be issued for such consideration
as may be fixed from time to time by the Board of
Directors, but not less than the par value stated
in the Articles of Incorporation. The
consideration paid for the issuance of shares
shall consist of money paid, labor done, or
property actually received, and neither
promissory notes nor the promise of future
services shall constitute payment nor partial
payment for shares of the Corporation.
6.04REPLACEMENT OF CERTIFICATES
No replacement share certificate shall be
issued until the former certificate for the
shares represented thereby shall have been
surrendered and canceled, except that
replacements for lost or destroyed certificates
may be issued, upon such terms, conditions, and
guarantees as the Board may see fit to impose,
including the filing of sufficient indemnity.
6.05SIGNING CERTIFICATES-FACSIMILE
SIGNATURES
All share certificates shall be signed by the
officer(s) designated by the Board of Directors.
The signatures of the foregoing officers may be
facsimiles. If the officer who has signed or
whose facsimile signature has been placed on the
certificate has ceased to be such officer before
the certificate issued, the certificate may be
issued by the Corporation with the same effect as
if he or she were such officer on the date of its
issuance.
6.06TRANSFER AGENTS AND REGISTRARS
The Board of Directors may appoint one or
more transfer agents or transfer clerks, and one
or more registrars, at such times and places as
the requirements of the Corporation may
necessitate and the Board of Directors may
designate. Each registrar appointed, if any,
shall be an incorporated bank or trust company,
either domestic or foreign.
6.07CONDITIONS OF TRANSFER
The party in whose name shares of stock stand
on the books of the Corporation shall be deemed
the owner thereof as regards the Corporation,
provided that whenever any transfer of shares
shall be made for collateral security, and not
absolutely, and prior written notice thereof
shall be given to the Secretary of the
Corporation, or to its transfer agent, if any,
such fact shall be stated in the entry of the
transfer.
6.08REASONABLE DOUBTS AS TO RIGHT TO
TRANSFER
When a transfer of shares is requested and
there is reasonable doubt as to the right of the
person seeking the transfer, the Corporation or
its transfer agent, before recording the transfer
of the shares on its books or issuing any
certificate therefor, may require from the person
seeking the transfer reasonable proof of that
person's right to the transfer. If there remains
a reasonable doubt of the right to the transfer,
the Corporation may refuse a transfer unless the
person gives adequate security or a bond of
indemnity executed by a corporate surety or by
two individual sureties satisfactory to the
Corporation as to form, amount, and
responsibility of sureties. The bond shall be
conditioned to protect the Corporation, its
officers, transfer agents, and registrars, or any
of them, against any loss, damage, expense, or
other liability for the transfer or the issuance
of a new certificate for shares.
ARTICLE SEVENBCORPORATE RECORDS AND
ADMINISTRATION
7.01MINUTES OF CORPORATE MEETINGS
The Corporation shall keep at the principal
office, or such other place as the Board of
Directors may order, a book recording the minutes
of all meetings of its Shareholders and
Directors, with the time and place of each
meeting, whether such meeting was regular or
special, a copy of the notice given of such
meeting, or of the written waiver thereof, and,
if it is a special meeting, how the meeting was
authorized. The record book shall further show
the number of shares present or represented at
Shareholders' meetings, and the names of those
present and the proceedings of all meetings.
7.02SHARE REGISTER
The Corporation shall keep at the principal
office, or at the office of the transfer agent, a
share register showing the names of the
Shareholders, their addresses, the number and
class of shares issued to each, the number and
date of issuance of each certificate issued for
such shares, and the number and date of
cancellation of every certificate surrendered for
cancellation. The above information may be kept
on an information storage device such as a
computer, provided that the device is capable of
reproducing the information in clearly legible
form. If the Corporation is taxed under Internal
Revenue Code Section 1244 or Subchapter S, the
Officer issuing shares shall maintain the
appropriate requirements regarding issuance.
7.03CORPORATE SEAL
The Board of Directors may at any time adopt,
prescribe the use of, or discontinue the use of,
such corporate seal as it deems desirable, and
the appropriate officers shall cause such seal to
be affixed to such certificates and documents as
the Board of Directors may direct.
7.04BOOKS OF ACCOUNT
The Corporation shall maintain correct
and adequate accounts of its properties and
business transactions, including accounts of
its assets, liabilities, receipts,
disbursements, gains, losses, capital,
surplus, and shares. The corporate
bookkeeping procedures shall conform to
accepted accounting practices for the
Corporation's business or businesses.
subject to the foregoing, The chart of
financial accounts shall be taken from, and
designed to facilitate preparation of,
current corporate tax returns. Any surplus,
including earned surplus, paid-in surplus,
and surplus arising from a reduction of
stated capital, shall be classed by source
and shown in a separate account. If the
Corporation is taxed under Internal Revenue
Code Section 1244 or Subchapter S, the
officers and agents maintaining the books of
account shall maintain the appropriate
requirements.
7.05INSPECTION OF CORPORATE RECORDS
A Director or Shareholder demanding to
examine the Corporation's books or records
may be required to first sign an affidavit
that the demanding party will not directly
or indirectly participate in reselling the
information and will keep it confidential
other than in use for proper purposes
reasonably related to the Director's or
Shareholder's role. A Director who insists
on examining the records while refusing to
sign this affidavit thereby resigns as a
Director.
7.06FISCAL YEAR
The fiscal year of the Corporation
shall be as determined by the Board of
Directors and approved by the Internal
Revenue Service. The Treasurer shall
forthwith arrange a consultation with the
Corporation's tax advisers to determine
whether the Corporation is to have a fiscal
year other than the calendar year. If so,
the Treasurer shall file an election with
the Internal Revenue Service as early as
possible, and all correspondence with the
IRS, including the application for the
Corporation's Employer Identification
Number, shall reflect such non-calendar year
election.
7.07 WAIVER OF NOTICE
Any notice required by law or by these
Bylaws may be waived by execution of a
written waiver of notice executed by the
person entitled to the notice. The waiver
may be signed before or after the meeting.
ARTICLE EIGHT- ADOPTION OF INITIAL
BYLAWS
The Board of Directors adopted the
foregoing bylaws on October 6, 1999.
/S/ John T. Bauska
Director
/S/ David R. Mortenson
Director
Attested to, and certified by: /S/
David R. Mortenson, Secretary
ARTHUR J. FROST, LTD.
Arthur J. Frost, Esq.
7549 W. Heatherbrae Drive
Phoenix, Arizona 85033
(623) 849-2050
(623) 873-1799 Facsimile
5
February 22, 2000
Xunantunich Inc.
21112 123rd Avenue
Maple Ridge, BC V2X 4B4
Canada
Re: Xunatunich Inc. Registration
Statement on Form SB2
Ladies and Gentlemen:
We have acted as counsel for
Xunantunich Inc., a Nevada corporation (the
ACompany@), in connection with the
preparation of the Registration Statement on
Form SB2 (the ARegistration Statement@) file
with the Securities and Exchange Commission
(the ACommission@) pursuant to the
Securities Act of 1933 (the AAct@), relating
to the public offering (the@Offering@) or up
to one million, five hundred and ten
thousand (1,510,000) shares (the AShares@)
of; the Company=s common stock, $0.001 par
value (the ACommon Stock@) to be sold by the
selling shareholders and by the issuer
through the means of a self-underwriting.
This opinion is being furnished pursuant to
Item 601(b)(5) of Regulation K under the
Act.
In rendering the opinions set
forth below, we have reviewed (a) the
Registration Statement and exhibits thereto;
(b) the Company=s Articles of Incorporation;
(c) the Company=s Bylaws; (d) certain
records of the Company=s corporate
proceedings as reflected in its minute
books; and (e) such statutes, records and
other documents as we have deemed relevant.
In our examination, we have assumed the
genuineness of all signatures, the
authenticity of all documents submitted to
us as originals and conformity with the
originals of all documents submitted to us
as copies thereof. In addition, we have
made other examinations of law and fact as
we have deemed relevant in order to form a
basis for the opinion hereinafter expressed.
Based on the foregoing, we are of the
opinion that those shares of the selling
shareholders are validly issued, fully paid and
non-assessable.
We are also of the opinion that if and
when the Registration Statement should become
effective, all shares sold to the public through
the use of the Registration Statement and the
Prospectus contained therein, will be validly
issued, fully paid and non-assessable.
We hereby consent to the use of this
opinion as an Exhibit to the Registration
Statement and to all references to this Firm
under the caption AInterests of Named Experts and
Counsel@ in the Registration Statement.
Very Truly Yours,
Arthur J. Frost Ltd.
S/S Arthur J. Frost
Arthur J. Frost
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1777 S. Harrison Street
Suite 2100
Denver, CO 80210
The Board of Directors
XUNANTUNICH, INC.
21112 123rd Avenue
Maple Ridge, BC V2X 4B4
Canada
Dear Sirs:
This letter will authorize you to include
the Audit of your company dated , 2000 and the
Audit Report dated February 29, 2000 in the
Registration Statement currently under review
with the Securities and Exchange Commission.
Yours Truly,
/S/ Janet Loss, C.P.A., P.C.
Janet Loss, C.P.A., P.C.
February 29, 2000