UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
TEXXON, INC.
(Exact name of small business issuer in its charter)
Oklahoma 73-1554122
-------- ----------
(State of incorporation) (IRS Employer ID No.)
331 East Chilton Drive
Chandler, AZ 85225
(Address of Principal Executive Offices and Zip Code)
2002 Non-Qualified Stock Option Plan of Texxon, Inc.
and
Common Stock and Options Issued Pursuant to Consulting Agreements
Ronald C. Kaufman
Kaufman & Associates
624 South Boston, 10th Floor
Tulsa, Oklahoma 74119
(918) 584-4463
(Name, address and telephone number of agent for service)
With Copy To:
Ronald C. Kaufman
Kaufman & Associates
624 South Boston, Suite 1070
Tulsa, Oklahoma 74119
(918) 584-4463
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
to be Price per Offering Registration
Title of Securities to be Registered Registered (4) Share (2) Price Fee (3)
- ---------------------------------------------------------------- ---------------- ------------ ------------- --------------
Common Stock, $0.001 par value, pursuant to the 2002
Non-Qualified Stock Option Plan of Texxon, Inc.................. 5,000,000 $0.14 $700,000 $64.40
Common Stock, $0.001 par value, issued pursuant to consulting
agreements...................................................... 1,000,000 (1) $0.14 $140,000 $12.88
---------------
$77.28
---------------
(1) Represents shares of common stock being offered for sale by selling
security holders. These shares were acquired in transactions exempt from
registration. See "Selling Security Holders".
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(h) under the Securities Act of 1933, as amended.
Pursuant to Rule 457(h), this estimate is based on the most recent sale of
the common stock of Texxon, Inc. at $.14 per share.
(3) Fees are calculated by multiplying the aggregate offering price by .000092
pursuant to Section 6(b) of the Securities Act.
(4) Pursuant to Rule 416, this registration statement also covers such
additional shares of our common stock as may be issued by reason of stock
splits, stock dividends or similar transactions.
1
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document(s) containing the information required in Part I of this
registration statement pertaining to shares of our common stock to be issued
upon exercise of options under the 2002 Non-Qualified Stock Option Plan of
Texxon, Inc. will be sent or given to you as required by Rule 428 under the
Securities Act of 1933. Such documents are not being filed with the SEC in
accordance with the requirements of Part I of Form S-8, but constitute (along
with the documents incorporated by reference into this registration statement
pursuant to Item II hereof) a prospectus that meets the requirements of Section
10(a) of the Securities Act of 1933.
PROSPECTUS
TEXXON, INC.
331 East Chilton Drive
Chandler, AZ 85225
(480) 926-5508
THE OFFERING
This prospectus covers the offering and sale of up to 1,000,000 shares
of common stock by the Selling Security Holders.
At such time as the Company is listed on a market or exchange, the
Selling Security Holders may sell their common stock from time to time in the
over-the-counter market or listed exchange at the prevailing market price or in
negotiated transactions. We will receive no proceeds from the sale of common
stock by the Selling Security Holders.
Our common stock is not currently trading on any market or listed
exchange.
THIS INVESTMENT involves a high degree of risk. You should invest in
the common stock only if you can afford to lose your entire investment. See
"Risk Factors" beginning on page 4 of this prospectus.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense. This prospectus is not an offer to sell these securities and
it is not soliciting an offer to buy these securities in any state where the
offer or sale is not permitted.
The date of this prospectus is January 27, 2003
Please read this prospectus carefully. It describes our company,
finances, products and services. Federal and state securities laws require that
we include in this prospectus all the important information that you will need
to make an investment decision.
You should rely only on the information contained or incorporated by
reference in this prospectus to make your investment decision. We have not
authorized anyone to provide you with different information. The Selling
Security Holders are not offering these securities in any state where the offer
is not permitted. You should not assume that the information in this prospectus
is accurate as of any date other than the date on the front page of this
prospectus.
2
The following table of contents has been designed to help you find important
information contained in this prospectus. We encourage you to read the entire
prospectus.
TABLE OF CONTENTS
PROSPECTUS SUMMARY.........................................................................................3
RISK FACTORS...............................................................................................4
USE OF PROCEEDS............................................................................................8
DETERMINATION OF OFFERING PRICE............................................................................8
PLAN OF DISTRIBUTION.......................................................................................9
DESCRIPTION OF SECURITIES.................................................................................10
INTEREST OF NAMED EXPERTS AND COUNSEL.....................................................................10
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE...........................................................10
AVAILABLE INFORMATION.....................................................................................11
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES.......................12
PROSPECTUS SUMMARY
Texxon, Inc. (the "Company") was incorporated in Oklahoma on October 6,
1998. The Company has been in the exploration stage since inception and has no
operating history other than organizational matters until February of 2001.
Texxon, Inc. owns the license to a method of platinum recovery from
mineralized water sources that recovers platinum with a purity of 95% to 99%, at
a cost below the cost of traditional mining. The Company has tested water
samples from 6 major sources including the following: sea water (Sea of Cortez,
Atlantic Ocean and the Caribbean), river water (Arkansas River in OK) and Well
Water (oil well water from Wyoming and several wells in AZ). The company has
found that many untreated water sources contain undetectable amounts of
platinum. When the recovery process is used with water from these sources, the
trace amounts of platinum are removed and concentrated as 95% to 99% pure metal.
On February 22, 2001, the Company was granted a perpetual license to use a
proven method of precious metal extraction that yields approximately 99% pure
platinum metal from mineralized water. The precious metal extraction process is
the result of over 10 years research and development by the inventor and owner
of the process, Russell Twiford.
3
RISK FACTORS
You should carefully consider each of the risks and uncertainties
described below and all the other information contained in this prospectus
before deciding to invest in shares of our common stock. The trading price of
our common stock could decline if any of the following risks and uncertainties
develop into actual events, and you may lose all or part of the money you paid
to buy our common stock.
This prospectus also contains forward-looking statements that involve
risks and uncertainties. Our actual results could differ materially from those
anticipated in these forward-looking statements as a result of certain factors,
including the risks faced by use described below and elsewhere in this
prospectus.
We Have A Limited Operating History
We have only been operating since October 1998. Accordingly, we have a
limited operating history upon which an evaluation of our performance and
prospects can be based. We face all of the risks common to companies in
their early stage of development, including:
-Under Capitalization
-Cash Shortages
-An Unproven Business Model
-A Product in the Development Stage
-Lack of Revenue, Cashflow, and Earnings to be Self-sustaining
Our failure to successfully address any of the risks described above
will have a material adverse effect on our business, financial condition
and on the price of our common stock.
We Expect Future Losses
As of September 30, 2002, we have lost $784,952 since the date of
inception, October 6, 1998. We expect to continue to incur losses until we
commence the operation of our production plant. We expect to incur losses
during the operation of our pilot plant. There is no assurance that we will
be able to develop commercially viable products or to generate net revenue
from the sale of our products, or to achieve or maintain profitable
operations.
Our Products Are Still In Development
Texxon has no products or services for sale at this time. The platinum
extraction process is still in the process enhancement stage. Platinum has
not yet been produced using a continuous process that will be required for
profitable operations. We have not submitted to or received environmental
approval from regulatory authorities. Permits may be required before we can
operate the extraction process in the United States. There is no assurance
that the process will be commercially viable or that the regulators will
approve the process for use in the U.S.
If We Cannot Generate Adequate, Profitable Sales Of Our Products, We Will Not Be
Successful
In order to succeed as a company, we must develop a commercially viable
product and sell adequate quantities at a high enough price to generate a
profit. We may not accomplish these objectives. Even if we succeed in
developing a commercially viable product, a number of factors may affect
future sales of our product. These factors include:
- The world market price of platinum;
- Acceptance of the grade of platinum as produced by our technology by
manufacturers and other purchasers; and - Whether the cost of our product
is competitive in the marketplace.
We Must Raise Additional Funds To Commence Operations
We require substantial additional working capital to build, equip and
commence production after completing pilot plant operations. There is no
assurance that the additional capital required will be available to Texxon
on acceptable terms when needed, if at all. To the extent that additional
financing proves to be unavailable when needed, the Company would, in all
likelihood, be compelled to abandon plans of constructing a production
4
facility, and would have minimal capital remaining to pursue other
opportunities. The failure by the Company to secure additional financing,
if needed, could also have a material adverse effect on the continued
development or growth of planned operations. The Company has no
arrangements with any bank or financial institution to secure additional
financing and there can be no assurance that any such arrangement, if
required or otherwise sought, would be available on terms deemed to be
commercially acceptable and in the best interests of the Company. Any
additional capital may involve substantial dilution to the interests of
Texxon's then existing shareholders.
We May Not Be Able To Borrow Funds If Needed
There currently are no limitations on the Company's ability to borrow
funds to increase the amount of capital available to the Company to
complete its business plan. However, the limited resources of the Company
and lack of operating history will make it difficult to borrow funds. The
amount and nature of any borrowings by the Company will depend on numerous
considerations, including the Company's capital requirements, the Company's
perceived ability to meet debt service on any such borrowings and the then
prevailing conditions in the financial markets, as well as general economic
conditions. There can be no assurance that debt financing, if required or
sought, would be available on terms deemed to be commercially acceptable by
and in the best interests of the Company. The inability of the Company to
borrow funds required to fund the pilot operations, or to provide funds for
an additional infusion of capital into a production facility, may have a
material adverse effect on the Company's financial condition and future
prospects. Additionally, to the extent that debt financing ultimately
proves to be available, any borrowings may subject the Company to various
risks traditionally associated with indebtedness, including the risks of
interest rate fluctuations and insufficiency of cash flow to pay principal
and interest.
We Are Unable To Ascertain Risks Relating To The Industry
The Company has limited experience in the precious metals industry and
may not be aware of all the customs, practices and competitors in that
industry. The consultants that the Company plans to retain may not have had
sufficient experience to enable the Company to completely understand the
characteristics of the industry. The Company will become subject to
numerous risks inherent in the business and operations of financially
unstable and early stage or potential emerging growth companies. An
extremely high level of risk frequently characterizes certain industries,
which experience rapid growth. Although management will endeavor to
evaluate the risks inherent in this particular industry, there can be no
assurance that the Company will properly ascertain or assess all such
risks.
We May Not Be Able To Market And Distribute Our Products
Our success depends, in part, on our ability to market and distribute
our products effectively. We have no experience in the sale or marketing of
precious metals. We have no marketing or distribution capabilities and we
will need to retain consultants that have contacts in and understand the
precious metals marketplace. We may not be successful in entering into
marketing arrangements, whether engaging independent distributors or
recruiting, training and retaining a marketing staff and sales force of our
own.
Intense Competition Could Harm Our Financial Performance
There are a number of companies, universities and research
organizations actively engaged in research and development of technology
that may be similar to the precious metals extraction process that has been
licensed by Texxon. Our competitors may have substantially greater assets,
technical staffs, established market shares, and greater financial and
operating resources than we do. There is no assurance that we can
successfully compete.
We Do Not Own The Process And Will Not Own Any Improvements
The precious metals extraction technology is owned by Russell Twiford
and licensed to Texxon. Improvements to the process will be owned by Mr.
Twiford. The process owner is responsible for recording all parts and
specifications of the invention and to cooperate and coordinate with Texxon
on any patent filings and to provide copies of material documents relevant
to any such filings. The process owner may be unwilling or unable to
provide the information required for the protection of the invention.
5
There May Be Competing Products In The Future
If competing products are able to generate an increased supply of
platinum, the company could suffer the adverse effects of a price decline
which may affect the profitability of the company. There is no assurance
that competing products will not be developed.
Our Lack Of Patent Protection Could Adversely Affect Our Ability To Compete
The precious metal extraction process is not currently covered by any
U.S. or foreign patent. If part or all of the process is acquired by
others, the Company will not have any patent protection and if patents were
filed by others, the Company may be prevented from continuing operations if
the extraction process infringes on the patent filed by others.
We Are Dependent Upon The Services Of The Researchers And Our Employees
The precious metals extraction process has been developed by Russell
Twiford. The pilot plant and subsequent production facility will be
operated by the officers of the Company under the guidance of Mr. Twiford.
The loss of the services of Mr. Twiford and the inability to retain an
acceptable substitute could have a material adverse effect on Texxon. The
License Agreement with Mr. Twiford continues in effect in perpetuity.
The Company is dependent upon the services of its officers and
consultants. The loss of the services of these key personnel or the
inability to retain such experienced personnel could have a material
adverse effect on Texxon. The officers of Texxon have entered into employee
agreements with the Company that provide for automatic two-year renewals
after the expiration of the initial term, August 1, 2002. The company does
not currently maintain key man insurance on the officers of the company.
Concentration Of Stock Ownership
Our officers, consultants and our key employees own a substantial
number of shares of the outstanding common stock. The joint venture
agreement provides that Texxon must exercise the right to acquire PGM
within 30 days after the end of the first fiscal year of profitable
operations. Texxon will exercise the right to acquire PGM. The Joint
Venture Agreement requires the issuance of up to 12,000,000 shares pursuant
to the acquisition of PGM Corporation. Accordingly, these groups of
shareholders, and potential shareholders, exercise substantial influence
over our business and the election of members to the Board of Directors. If
the acquisition of PGM occurs, the shareholders of PGM may impose
conditions that would have a negative impact on the operations of the
Company.
Unanticipated Obstacles to Execution of the Business Plan
The Company's business plans may change significantly. Many of the
Company's potential business endeavors are capital intensive and may be
subject to statutory or regulatory requirements. Management reserves the
right to make significant modifications to the Company's stated strategies
depending on future events.
Protection for Proprietary Rights; Reliance on Trade Secrets
In certain cases, for example exact timing, operating temperatures or
measurements, where the disclosure of this or similar information required
to obtain a patent would divulge proprietary data, the Company may choose
not to patent parts of the proprietary technology and processes which the
Company has developed or may develop in the future and rely on trade
secrets to protect the proprietary technology and processes. The protection
of proprietary technology through claims of trade secret status has been
the subject of increasing claims and litigation by various companies both
in order to protect proprietary rights as well as for competitive reasons
even where proprietary claims are unsubstantiated. The prosecution of
proprietary claims or the defense of such claims is costly and uncertain
given the uncertainty and rapid development of the principles of law
pertaining to this area. The Company may also be subject to claims by other
parties with regard to the use of technology information and data which may
be deemed proprietary to others.
6
Broker - Dealer Sales of Shares
The Company's Common Stock is not presently included for trading on any
exchange, and there can be no assurances that the Company will ultimately
be registered on any exchange. The NASDAQ Stock Market, Inc. has recently
enacted certain changes to the entry and maintenance criteria for listing
eligibility on the NASDAQ SmallCap Market. The entry standards require at
least $4 million in net tangible assets or $750,000 net income in two of
the last three years. The proposed entry standards would also require a
public float of at least 1 million shares, $5 million value of public
float, a minimum bid price of $2.00 per share, at least three market
makers, and at least 300 shareholders. The maintenance standards (as
opposed to entry standards) require at least $2 million in net tangible
assets or $500,000 in net income in two of the last three years, a public
float of at least 500,000 shares, a $1 million market value of public
float, a minimum bid price of $1.00 per share, at least two market makers,
and at least 300 shareholders.
There is no trading market for our common stock and there is no
assurance that a trading market will ever be established, developed or
maintained. Even if our common stock is approved for trading
over-the-counter, we will be subject to the "penny stock rules" adopted
pursuant to Section 15(g) of the Securities Exchange Act of 1934, as
amended. In general, the penny stock rules apply to non-NASDAQ or
non-national stock exchange companies whose common stock trades at less
than $5.00 per share or which have tangible net worth of less than
$5,000,000 ($2,000,000 if the company has been operating for three or more
years). Such rules require, among other things, that brokers who trade
"penny stock" to persons other than "established customers" complete
certain documentation, make suitability inquiries of investors and provide
investors with certain information concerning trading in the security,
including a risk disclosure document, quote information, broker's
commission information and rights and remedies available to investors in
penny stocks. Many brokers have decided not to trade "penny stock" because
of the requirements of the penny stock rules and, as a result, the number
of broker-dealers willing to act as market makers in such securities is
limited. These "penny stock rules," therefore, may make it difficult, if
not impossible, to sell your shares.
Offering Price
The price of the Shares offered has been arbitrarily established by
Texxon, Inc., considering such matters as the state of the Company's
business development and the general condition of the industry in which it
operates. The Offering price bears little relationship to the assets, net
worth, or any other objective criteria of value applicable to Texxon, Inc.
Projections: Forward Looking Information
Management has prepared projections regarding Texxon, Inc.'s
anticipated financial performance. The Company's projections are
hypothetical and based upon the historical financial performance of the
Company, the addition of a sophisticated and well funded marketing plan,
and other factors influencing the business of Texxon, Inc. The projections
are based on Management's best estimate of the probable results of
operations of the Company, based on present circumstances, and have not
been reviewed by Texxon, Inc.'s independent accountants. These projections
are based on several assumptions, set forth therein, which Management
believes are reasonable. Some assumptions upon which the projections are
based, however, invariably will not materialize due the inevitable
occurrence of unanticipated events and circumstances beyond Management's
control. Therefore, actual results of operations will vary from the
projections, and such variances may be material. Assumptions regarding
future changes in sales and revenues are necessarily speculative in nature.
In addition, projections do not and cannot take into account such factors
as general economic conditions, unforeseen regulatory changes, the entry
into Texxon, Inc.'s market of additional competitors, the terms and
conditions of future capitalization, and other risks inherent to the
Company's business. While Management believes that the projections
accurately reflect possible future results of Texxon, Inc.'s operations,
those results cannot be guaranteed.
7
Limited Experience Of Management And Potential Conflicts Of Interest
The officers and consultants of Texxon have had limited experience in
the precious metals industry. In addition, the consultants retained by the
Company are associated with other firms involved in a range of business
activities. Consequently, there are potential conflicts of interest. The
company may suffer damage if the consultants are involved with other
companies that are pursuing the development of a similar technology and
inadvertently or intentionally disclose proprietary information to these
companies. The Articles of Incorporation and the bylaws of the company do
not provide for the resolution of conflicts of interest, however the
agreements with the inventor and consultant provide for arbitration of
disputes. If a conflict of interest develops, the Company will seek
resolution by arbitration. Management estimates that not more than 50% of
the consultants' time will be devoted to Texxon's activities.
There Is Limited Likelihood Of A Regular Trading Market For The Common Stock
A public market for the common stock does not exist and there can be no
assurance that one will ever develop, or if developed, will continue.
Creation of a public market for the common stock depends on, (i) acceptance
of the Company on an exchange or interdealer quotation system, (ii) filing
of a Form 15c211 with NASDAQ for trading on the bulletin board, or (iii)
registration of the shares through a registration statement filed under the
Securities Act of 1933, as amended (the "Securities Act"). Such actions may
be costly and difficult and could potentially fail. If so, it would
substantially hinder the liquidity of the common stock. If no market
develops, it may be difficult or impossible for the holders of the common
stock to sell their securities if they should desire to do so. In addition,
there are substantial restrictions on the sale or transfer of common stock
imposed by federal and state security laws, if the shares of common stock
of the Company are not registered through a registration statement. If the
shares are registered, there are no assurances that a regular trading
market will develop for any of the common stock and that, if developed, any
such market will be sustained.
Going Concern
We are an Exploration stage company with no revenues. We will not have
revenues until such time as a commercially viable production facility is
developed. Until then, development efforts will depend upon our ability to
raise sufficient operating capital. If such capital is not raised, we will
not be able to continue as a going concern.
.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares by the
Selling Security Holders.
DETERMINATION OF OFFERING PRICE
At such time as the Company is listed on a market or exchange, the
Selling Security Holders may sell their common stock from time to time in the
over-the-counter market or listed exchange at the prevailing market price The
offering price of the securities for registration fee purposes was calculated
based on the most recent sale of the Company's common stock at $14. per share
and was not computed based on the assets, historical operating performance or
other conventional means and should not be construed to indicate any
relationship thereto.
8
SELLING SECURITY HOLDERS
The shares being offered by the Selling Security Holder's were acquired by
them pursuant to consulting agreements. The following table and discussion sets
forth certain information with respect to the selling security holders.
Shares of
Common Percent
Relationship Shares of Stock Of Shares
with Company Common Stock Number of Owned Owned
Selling Security during past Owned Before Shares After This After
Holder three years This Offering Offered (1) Offering Offering
- ----------------------- -------------- -------------- --------------- ------------ -----------
Consultants as a group Consultant 785,714 785,714 0 0
Robert Yoe, Jr. Director 214,286 214,286 0 0
-------------- --------------- ------------ -----------
Total 1,000,000 1,000,000 0 0
(1) Assumes all common shares are sold pursuant to this offering. Selling
shareholder, however, may choose to sell only a portion or none of his
shares of common stock. There are currently no agreements, arrangements
or understandings with respect to the sale of any of the shares of common
stock.
PLAN OF DISTRIBUTION
We are registering securities on behalf of the Selling Security
Holders. All costs, expenses and fees in connection with the registration of
such securities will be paid by us. We estimate such costs, expenses and fees to
be $2,500. Brokerage commissions and similar selling expenses, if any,
attributable to the sale of securities will be paid by the Selling Security
Holders.
The Selling Security Holder's may sell up to 1,000,000 shares of common
stock from time to time. Each Selling Security Holder may sell his shares (1) in
market transactions at such time as the Company's common stock commences trading
on a listed exchange or market , to a broker-dealer, including a market maker,
who purchases the shares for its own account, in private transactions, or by
gift. Each Selling Security Holder may also pledge his shares from time to time,
and the lender may sell the shares upon foreclosure.
The decision to sell any securities is within the discretion of the
Selling Security Holder. Each is free to offer and sell his securities at times,
in a manner and at prices as he determines.
Each Selling Security Holder may sell the shares at a negotiated price
or at the market price or both. He may sell his shares directly to a purchaser
or he may use a broker. If a broker is used, the Selling Security Holder may pay
a brokerage fee or commission or he may sell the shares to the broker at a
discount from the market price. The purchaser of the shares may also pay a
brokerage fee or other charge. The compensation to a particular broker-dealer
may exceed customary commissions. We do not know of any arrangements by the
Selling Security Holders for the sale of any of their shares.
Each Selling Security Holder and broker-dealers, if any, acting in
connection with sales by the Selling Security Holder may be deemed to be
"underwriters" within the meaning of Section 2(11) of the Securities Act, and
any commission received by them and any profit on the resale by them of the
securities may be deemed to be underwriting discounts and commissions under the
Securities Act.
9
We have advised the selling shareholder that the anti-manipulative
rules under the Exchange Act, which are set forth in Regulation M, may apply to
his sales in the market. We have furnished the Selling Security Holders with a
copy of regulation M, and we have informed them that they should deliver a copy
of this prospectus when they sell any shares.
DESCRIPTION OF SECURITIES
Texxon is authorized to issue up to 45,000,000 shares of common stock,
par value $0.001 per share, of which 14,970,570 shares were issued and
outstanding prior to this offering. Texxon is also authorized to issue up to
5,000,000 shares of Preferred Stock, par value $0.001 per share, of which there
are no shares are outstanding. There is no present intent to issue any Preferred
Stock.
Voting Rights. Holders of shares of common stock are entitled to one
vote per share on all matters submitted to a vote of the shareholders. Shares of
Common Stock do not have cumulative voting rights, which means that the holders
of a majority of the shareholder votes eligible to vote and voting for the
election for the Board of Directors can elect all members of the Board of
Directors. Holders of a majority of the issued and outstanding share of Common
Stock may take action by written consent without a meeting.
Dividend Rights. Holders of record of shares of common stock are
entitled to receive dividends which and if declared by the Board of Directors.
To date, Texxon has not paid cash dividends on its common stock. Holders of
common stock are entitled to receive such dividends as may be declared and paid
from time to time by the Board of Directors out of funds legally available for
dividends. Texxon intends to retain any earnings from the operation and
expansion of its business and does not anticipate paying cash dividends in the
foreseeable future. Any future determination as to the payment of cash dividends
will depend upon future earnings, results of operations, capital requirements,
Texxon's financial condition and such other factors as the Board of Directors
may consider.
Liquidation Rights. Upon any liquidation, dissolution or winding up of
Texxon, holders of share of common stock are entitled to receive pro rata all of
the assets of Texxon available for distribution to shareholders after
liabilities are paid and distributions are made to the holders of Texxon's
preferred stock.
Preemptive Rights. Holders of common stock do not have any preemptive
rights to subscribe for or to purchase any stock, obligations or other
securities of Texxon.
INTEREST OF NAMED EXPERTS AND COUNSEL
None.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" information that we
file with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information we file later with the SEC
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings we will make with
the SEC under Section 13(a), 13(c), 14 or 15 of the Securities Exchange Act of
1934
1. Our Form 10-QSB for the period ended March31, 2002 and filed with the
SEC on May 15, 2002.
2. Our Amended Form 10-QSB for the period ended June 30, 2002 and filed
with the SEC on November 1, 2002
3. Our Form 10-QSB for the period ended September 31, 2002 and filed with
the SEC on November 13, 2002.
4. Our Amended Registration Statement on Form 10-SB filed with the SEC
November 1, 2002.
10
This prospectus is part of a registration statement we filed with the
SEC. You should rely only on the information incorporated by reference or
provided in this prospectus and the registration statement. We have authorized
no one to provide you with different information. You should not assume that the
information in this prospectus is accurate as of any date other than the date on
the front of the statement.
If we file any document with the SEC that contains information which is
different from the information contained in this prospectus, you may rely only
on the most recent information which we have filed with the Commission.
We will provide a copy of the documents referred to above without
charge if you request the information from us. You should contact Gifford M.
Mabie III, President, Texxon, Inc., 331 East Chilton Drive, Chandler, AZ 85225,
telephone (480) 926-5508, if you wish to receive any of such material.
AVAILABLE INFORMATION
We file annual, quarterly and periodic reports, proxy statements and
other information with the Securities and Exchange Commission using the
Commission's EDGAR system. You can review such information at the SEC's website,
www.sec.gov.
You may also read and copy any materials the Company files with the SEC
at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. You may obtain information on the operation of the Public Reference Room
by calling the SEC at 1-800-SEC-0330.
We furnish our shareholders with annual reports containing audited
financial statements and with such other periodic reports as we, from time to
time, deem appropriate or as may be required by law. We use the calendar year as
our fiscal year.
You should rely only on the information contained in this Prospectus
and the information we have referred you to. We have not authorized any person
to provide you with any information that is different.
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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, and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
We hereby incorporate, or will be deemed to have incorporated, herein
by reference the following documents:
(1) Our Form 10-QSB for the period ended March31, 2002 and filed with
the SEC on May 15, 2002.
(2) Our Amended Form 10-QSB for the period ended June 30, 2002 and
filed with the SEC on November 1, 2002
(3) Our Form 10-QSB for the period ended September 30, 2002 and filed
with the SEC on November 13, 2002.
(4) Our Amended Registration Statement on Form 10-SB filed with the
SEC November 1, 2002.
Each document filed subsequent to the date of this registration
statement pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934 and prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold shall be deemed to be incorporated in this
registration statement by reference and to be a part hereof from the date of the
filing of such documents. Any statement contained in a document incorporated or
deemed to be incorporated herein by reference shall be deemed to be modified or
superseded for purposes of this registration statement to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel. None.
Item 6. Indemnification of Officers and Directors.
Our Certificate of Incorporation and Bylaws provide for indemnification
to the full extent permitted by Oklahoma law of all persons we have the power to
indemnify under Oklahoma law. Such indemnification is not deemed to be exclusive
of any other rights to which those indemnified may be entitled, under any bylaw,
agreement, vote of stockholders or otherwise. The indemnification provisions of
our Certificate of Incorporation and Bylaws may reduce the likelihood of
derivative litigation against our directors and officers for breach of their
fiduciary duties, even though such action, if successful, might otherwise
benefit us and our stockholders.
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We have entered into separate written indemnification agreements with
our officers, directors, consultants and others. These agreements provide that
we will indemnify each person for acts committed in their capacities and for
virtually all other claims for which a contractual indemnity might be
enforceable.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
Exhibit Number Description of Exhibit
-------------- ---------------------------------------------------
4.1 2002 Non-Qualified Stock Option Plan of Texxon, Inc.
5.1 Opinion of Kaufman & Associates
23.1 Consent of Rodefer Moss & Co, PLLC
23.2 Consent of Kaufman & Associates (included in Exhibit 5.1)
Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement 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, 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; and
(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.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's Annual Report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
Annual Report pursuant to Section 15(d) of the Exchange Act) 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.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
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in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the State of Oklahoma, on this 27th day of January, 2003.
TEXXON, INC.
By: /s/ Gifford M. Mabie III
-----------------------------
Gifford M. Mabie III
Chief Executive Officer
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