UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A - AMENDMENT 1
Information Required in Proxy Statement
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
| | Preliminary Proxy Statement
| | Confidential, for Use of the Commission Only (as permitted by Rule 14a-
6(e)(2))
|X| Definitive Proxy Statement
| | Definitive Additional Materials
| | Soliciting Material Under Rule 14a-12.
DAKOTA IMAGING, INC.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
| | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1) Title of each class of securities to which transaction applies:
Common Stock, par value $.001 per share, of Dakota Imaging, Inc.
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: The filing fee was calculated pursuant to
Exchange Act Rule 0-11 (c)(1), and is the product of multiplying 1/50 of 1%
by an amount equal to the sum of (x) the product of ______________ shares of
Common Stock, par value $.001 per share, of Dakota Imaging, Inc. multiplied
by $_____________ per share, and (y) $___________ payable to holders of
outstanding options to purchase shares of Common Stock in exchange for the
cancellation of such options.
(4) Proposed maximum aggregate value of transaction: -0-
(5) Total fee paid: -0-
| | Fee paid previously with preliminary materials.
| | Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
_____________________________________________
(2) Form, Schedule or Registration Statement No.:
_____________________________________________
(3) Filing Party:
_____________________________________________
(4) Date Filed:
_____________________________________________
DAKOTA IMAGING, INC.
4483 West Reno Avenue
Las Vegas, NV 89118
(702) 221-8070
Dear Dakota Imaging, Inc. Shareholder:
You are cordially invited to attend the Annual meeting of shareholders
of Dakota Imaging, Inc., a North Dakota corporation, ("Dakota") to be held on
April 4,2, 2002, at 10:00 a.m., local time, at The Conference Room, Suite
115111 - 1850 E. Flamingo Road, Las Vegas, Nevada 89119. At the Annual
meeting, you will be asked to consider and vote on the following proposals;
1. To elect a new Board of Directors for Dakota to serve through the next
year, (current nominations are for Gregg Giuffria, Veldon Simpson, and
Richard Hannigan);
2. To change the Company's fiscal year end to December 31;
3. To change the Company's name from Dakota Imaging, Inc. to Voyager
Entertainment International, Inc.;
4. To amend the Company's Certificate of Incorporation to:
* reflect the name change referenced in proposal 3;
* provide for holders of a majority of the Company's voting stock to take
corporate action by written consent, without having to submit the action to a
vote of all of the shareholders; and
* specify the notice requirements to shareholders of an action to be taken
by majority stockholder consent.
5. To amend and restate the Company's Bylaws to:
* change the authorized number of directors that the Company may have to
no fewer than 1 nor more than 7;
* reflect the change in fiscal year end referenced in proposal 2;
* add a provision for the office of Chief Executive Officer to be the
highest ranking office of the Company;
* provide for holders of a majority of the Company's voting stock to take
corporate action by written consent, without having to submit the action to a
vote of all of the shareholders;
* specify the notice requirements to shareholders of an action to be taken
by majority stockholder consent; and
* update, expand and provide greater detail to the Bylaws to further
define the manner by which the Company will be governed.
6. To Ratify the appointment of MERDINGER, FRUCHTER, ROSEN & CORSO, P.C. to
serve as the Company's auditor;
7. To adopt a stock option plan providing for options on up to 5 million
shares of common stock;
8. stock;To adjourn or postpone the meeting for the purpose of soliciting
additional proxies, and
9. To transact such other business as may properly come before the Annual
meeting or any adjournment or postponement.
The Board of Directors has specified March 1, 2002, at the close of business,
as the record date for the purpose of determining the shareholders who are
entitled to receive notice of and to vote at the Annual meeting. A list of
the shareholders entitled to vote at the Annual meeting will be available for
examination by any shareholder at the Annual meeting. For 10 days prior to
the Annual meeting, this shareholder list will also be available for
inspection by shareholders at our corporate offices at 4483 West Reno Avenue,
Las Vegas during ordinary business hours.
Please read the proxy statement and other materials concerning Dakota
Imaging, Inc., which are mailed with this notice, for a more complete
statement regarding the Proposals to be acted upon at the Annual meeting.
Whether or not you plan to attend the Annual meeting, please take the
time to vote on the Proposals submitted by completing and mailing the
enclosed proxy card to us. Please sign, date and mail your proxy card
indicating how you wish to vote. If you fail to return your proxy card, the
effect will be a vote against the Proposals.
Sincerely,
/s/ Richard hannigan
Richard Hannigan
PRESIDENT AND DIRECTOR
The Proposals voted upon have not been approved or disapproved by the
Securities and Exchange Commission (the "SEC") or any state securities
regulators nor has the SEC or any state securities regulator passed upon the
fairness or merits of the Proposals or upon the accuracy or adequacy of the
information contained in this proxy statement. Any representation to the
contrary is unlawful.
This proxy statement is dated March 20, 2002, and is first being mailed
to Dakota shareholders on or about March ____,22, 2002 to shareholders of
record as of March 1, 2002.
DAKOTA IMAGING, INC.
4483 West Reno Avenue
Las Vegas, NV 89118
(702) 221-8070
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 4,2, 2002
Dear Dakota Shareholder:
We will hold the Annual meeting of Shareholders of Dakota Imaging, Inc.
on April 4,2, 2002, at 10:00 a.m., local time, at the Conference Room, Suite
115,111, 1850 E. Flamingo Rd., Las Vegas, Nevada 89119, for the following
purposes:
1. To elect a new Board of Directors for Dakota to serve through the next
year, (current nominations are for Gregg Giuffria, Veldon Simpson, and
Richard Hannigan);
2. To change the Company's fiscal year end to December 31;
3. To change the Company's name from Dakota Imaging, Inc. to Voyager
Entertainment International, Inc.;
4. To amend the Company's Certificate of Incorporation to:
* reflect the name change referenced in proposal 3;
* provide for holders of a majority of the Company's voting stock to take
corporate action by written consent, without having to submit the action to a
vote of all of the shareholders; and
* specify the notice requirements to shareholders of an action to be taken
by majority stockholder consent.
5. To amend and restate the Company's Bylaws to:
* change the authorized number of directors that the Company may have to
no fewer than 1 nor more than 7;
* reflect the change in fiscal year end referenced in proposal 2;
* add a provision for the office of Chief Executive Officer to be the
highest ranking office of the Company;
* provide for holders of a majority of the Company's voting stock to take
corporate action by written consent, without having to submit the action to a
vote of all of the shareholders;
* specify the notice requirements to shareholders of an action to be taken
by majority stockholder consent; and
* update, expand and provide greater detail to the Bylaws to further
define the manner by which the Company will be governed.
6. To ratify the appointment of MERDINGER, FRUCHTER, ROSEN & CORSO, P.C. to
serve as the Company's auditor;
7. To adopt a stock option plan providing for options on up to 5 million
shares of common stock;
8. stock;To adjourn or postpone the meeting for the purpose of soliciting
additional proxies, and
9. To transact such other business as may properly come before the Annual
meeting or any adjournment or postponement.
The Board of Directors has determined that the Proposals are fair to,
and in the best interests of, the Dakota shareholders and unanimously
recommends that you vote "FOR" the Proposals.
Only Dakota shareholders of record at the close of business on March 1,
2002 are entitled to notice of and to vote at the Annual meeting or any
adjournment or postponement thereof. A complete list of the shareholders
entitled to vote at the Annual meeting or any adjournments or postponements
of the Annual meeting will be available at and during the Annual meeting.
The information contained in this letter is only a summary of the
actions to be voted on at the Annual Meeting and is not meant to be complete
and exhaustive. You are encouraged to read the attached proxy statement,
including its exhibits, in its entirety for further information regarding the
proposals.
YOUR VOTE IS IMPORTANT. TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE
ANNUAL MEETING, YOU ARE URGED TO COMPLETE, DATE AND SIGN THE ENCLOSED PROXY
CARD AND MAIL IT PROMPTLY TO THE COMPANY, WHETHER OR NOT YOU PLAN TO ATTEND
THE ANNUAL MEETING IN PERSON. YOU MAY REVOKE YOUR PROXY IN THE MANNER
DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT ANYTIME BEFORE IT HAS BEEN
VOTED AT THE ANNUAL MEETING. IF YOU RETURN A PROXY WITHOUT SPECIFYING A
CHOICE ON THE PROXY, THE PROXY WILL BE VOTED "FOR" THE PROPOSALS. IT MAY BE
POSSIBLE FOR YOU TO VOTE IN PERSON AT THE ANNUAL MEETING EVEN IF YOU HAVE
RETURNED A PROXY. PLEASE REVIEW THE PROXY STATEMENT FOR MORE INFORMATION.
By Order of the Board of Directors
/s/ Richard Hannigan
Richard Hannigan
PRESIDENT AND DIRECTOR
4483 West Reno Avenue
Las Vegas, NV 89118
March 18, 2002
TABLE OF CONTENTS
PAGE
SUMMARY OF PROPOSALS 1
Date, Time and Place 1
Purpose of the Meeting 1
Shareholders Entitled to Vote 2
Vote Required 2
Recommendation of Dakota's Board of Directors 2
QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING 3
WHO CAN HELP ANSWER YOUR QUESTIONS 4
CAUTIONARY STATEMENT CONCERNING FORWARD LOOKING STATEMENTS 4
THE ANNUAL MEETING 5
Time, Place and Date 5
Purpose of the Meeting 5
ITEM 1. Election of Directors 5
ITEM 2. Change of fiscal year end 6
ITEM 3. Change of name 6
ITEM 4. Amendment to Certificate of Incorporation 7
ITEM 5. Amendment and restatement of Bylaws 8
ITEM 6. Ratify appointment of auditors 16
ITEM 7. Adopt Stock Option Plan 16
ITEM 8. To adjourn or postpone the meeting for the purpose of
soliciting additional proxies 16
ITEM 9. Transaction of other business 17
Record Date and Voting at the Annual Meeting 17
Votes Required 18
Solicitation and Proxy Solicitor 18
Revocation and Use of Proxies 18
Adjournments or Postponements 18
INTEREST OF CERTAIN PERSONS IN OR
OPPOSITION TO MATTERS ACTED UPON 19
AUDIT COMMITTEE ( No Audit Committee Exists) 19
INDEPENDENT AUDITORS 19
CURRENT OFFICERS AND DIRECTORS 20
Board of Directors Meetings 21
Insider Participation in Compensation Decision 21
Board of Directors Report on Executive Compensation 21
EXECUTIVE COMPENSATION 22
VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS THEREOF 23
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE 24
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS 24
SHAREHOLDER PROPOSALS FOR THE 2003 ANNUAL MEETING 24
OTHER MATTERS 24
EXPENSES OF PROXY SOLICITATION 25
WHERE YOU CAN FIND MORE INFORMATION 25
EXHIBITS
Exhibit A - Amended Certificate of Incorporation A-1
Exhibit B - Amended and Restated Bylaws B-1
Exhibit C - 2002 Stock Option Plan C-1
SUMMARY OF PROPOSALS
This summary highlights selected information included in this proxy
statement. This summary may not contain all of the information that is
important to you. For a more complete understanding of the Proposals and the
other information contained in this proxy statement, you should read this
entire proxy statement carefully, as well as the additional documents to
which it refers. For instructions on obtaining more information, see "Where
You Can Find More Information."
Date, Time and Place of Annual Meeting April 4, 2002, at 10:00 a.m., Las
Vegas time, at the Conference Room,
Suite 115, 1850 East Flamingo Rd.,
Las Vegas, Nevada, ("the Annual
Meeting"). (See "INTRODUCTION")
Date, Time and Place of Annual Meeting April 2, 2002, at 10:00 a.m., Las
Vegas time, at the Conference Room,
Suite 111, 1850 East Flamingo Rd.,
Las Vegas, Nevada, ("the Annual
Meeting"). (See "INTRODUCTION")
Purpose of the Meeting 1. To elect a new Board of
Directors for Dakota to serve
through the next year, (current
nominations are for Gregg Giuffria,
Veldon Simpson, and Richard
Hannigan);
2. To change the Company's fiscal
year end to December 31;
3. To change the Company's name
from Dakota Imaging, Inc. to Voyager
Entertainment International, Inc.;
4. To amend the Company's
Certificate of Incorporation;
5. To amend and restate the
Company's Bylaws;
6. To Ratify the appointment of
MERDINGER, FRUCHTER, ROSEN & CORSO,
P.C. to serve as the Company's
auditor;
7. To adopt a stock option plan
providing for options of up to 5
million shares of common stock;
8. To adjourn or postpone the
meeting for the purpose of
soliciting additional proxies, and
9. To transact such other business
as may properly come before the
Annual meeting or any adjournment or
postponement.
Shareholders Entitled to Vote Only Dakota shareholders of record
at 5:00 p.m., Las Vegas time on
March 1, 2002 are entitled to notice
of and to vote at the Annual
Meeting.
Vote Required Under North Dakota law, the
Proposals at the Annual meeting
require the affirmative vote of the
holders of a majority of the Dakota
Common Stock outstanding and
entitled to vote. (See
"Introduction," and "The Proposal-
Vote Required.") The officers and
directors of Dakota control an
aggregate of 18,000,000 shares of
common stock and 1,500,000 shares of
preferred stock. The preferred stock
has 10:1 voting rights. Therefore,
in the aggregate, the officers and
directors of Dakota control, and
intend to vote, 33,000,000 votes, of
the total potential aggregate votes
of 49,015,000, (34,015,000 common
share votes, and 15,000,000
preferred votes), or approximately
67%, consequently the passage of the
proposals is assured.
Recommendation of the Board of
Directors of Dakota Our Board of Directors has
determined that the Proposals are
advisable and in the best interests
of Dakota and our shareholders and
that the Proposals are fair to our
shareholders Our Board of Directors
recommends that you vote "FOR"
adoption of the Proposals.
QUESTIONS AND ANSWERS ABOUT THE MEETING AND VOTING
WHAT DOES OUR BOARD OF DIRECTORS RECOMMEND?
Our Board of Directors recommends that you vote "FOR" adoption of the
Proposals. Our Board of Directors has determined that the Proposals are
advisable and in the best interests of Dakota and our shareholders and that
the Proposals are fair to our shareholders.
Our Board of Directors has approved and recommended adoption of the
Proposals.
IF MY SHARES OF DAKOTA COMMON STOCK ARE HELD IN "STREET NAME" BY MY BROKER,
WILL MY BROKER VOTE MY SHARES FOR ME?
No. The law does not allow your broker to vote your shares of Dakota
common stock on the Proposals at the Annual meeting without your direction.
You should follow the instructions from your broker on how to vote your
shares. Shares that are not voted because you do not instruct your broker are
called "broker non-votes," and will have the effect of a vote "AGAINST" the
Proposals.
IF I SEND IN MY PROXY CARD BUT DO NOT INDICATE MY VOTE, HOW WILL MY SHARES BE
VOTED?
If you sign and return your proxy card but do not indicate how to vote
your shares at the Annual meeting, the shares represented by your proxy will
be voted "FOR" the Proposals.
WHAT IF I DON'T RETURN MY PROXY CARD?
Since it takes a majority of the shares outstanding to approve the
Proposals, not returning your proxy card is the same as voting against the
Proposals.
WHAT SHOULD I DO NOW TO VOTE AT THE ANNUAL MEETING?
Sign, mark and mail your proxy card indicating your vote on the
Proposals in the enclosed return envelope as soon as possible, so that your
shares of Dakota common stock can be voted at the Annual meeting.
MAY I CHANGE MY VOTE AFTER I MAIL MY PROXY CARD?
Yes. You may change your vote at any time before your proxy is voted at
the Annual meeting. You can do this in one of three ways:
* You can send Dakota a written statement that you revoke your proxy,
which to be effective must be received prior to the vote at the Annual
meeting;
* You can send Dakota a new proxy card prior to the vote at the Annual
meeting, which to be effective must be received by Dakota prior to the vote
at the Annual meeting; or
* You can attend the Annual meeting and vote in person. Your attendance
alone will not revoke your proxy. You must attend the Annual meeting and cast
your vote at the Annual meeting.
Send any revocation of a proxy or new proxy card to the attention of the
Corporate Secretary at Dakota, 4483 West Reno Avenue, Las Vegas, Nevada (702)
221-8070. If your shares are held in street name, you must follow the
directions provided by your broker to vote your shares or to change your
instructions.
WHO CAN HELP ANSWER YOUR QUESTIONS
If you have more questions about the Proposals or would like additional
copies of the proxy statement, you should contact:
Dakota Imaging, Inc.
4483 West Reno Avenue
Las Vegas, NV 89118
Attention: Richard Hannigan
President and Director
Telephone Number: (702) 221-8070
CAUTIONARY STATEMENT CONCERNING
FORWARD-LOOKING STATEMENTS
This proxy statement and the documents to which we refer you to in this
proxy statement may contain forward-looking statements. In addition, from
time to time, we or our representatives may make forward-looking statements
orally or in writing. We base these forward-looking statements on our
expectations and projections about future events, which we derive from the
information currently available to us. Such forward-looking statements relate
to future events or our future performance, including:
* our financial performance and projections;
* our growth in revenue and earnings; and
* our business prospects and opportunities.
You can identify forward-looking statements by those that are not
historical in nature, particularly those that use terminology such as "may,"
"will," "should," "expects," "anticipates," "contemplates," "estimates,"
"believes", "plans," "projected," "predicts," "potential" or "continue" or
the negative of these or similar terms. In evaluating these forward-looking
statements, you should consider various factors, including
* our ability to retain the business of our significant customers;
* our ability to keep pace with new technology and changing market needs;
* our ability, upon completion of the merger, to obtain capital; and
* the competitive environment of our business.
These and other factors may cause our actual results to differ
materially from any forward-looking statement.
Forward-looking statements are only predictions. The forward-looking
events discussed in this proxy statement, the documents to which we refer you
and other statements made from time to time by us or our representatives, may
not occur, and actual events and results may differ materially and are
subject to risks, uncertainties and assumptions about us. We are not
obligated to publicly update or revise any forward-looking statement, whether
as a result of uncertainties and assumptions, the forward-looking events
discussed in this proxy statement, the documents to which we refer you and
other statements made from time to time by us or our representatives, might
not occur.
THE ANNUAL MEETING
TIME, PLACE AND DATE
We are furnishing this proxy statement to Dakota shareholders in
connection with the solicitation of proxies by the Dakota Board of Directors
for use at the Annual meeting of shareholders of Dakota to be held on April
4,2, 2002, at 10:00 a.m., local time, at the Conference Room, Suite 115,111,
1850 East Flamingo Rd., Las Vegas, Nevada, or any adjournment or postponement
thereof, pursuant to the enclosed Notice of Annual Meeting of Shareholders.
PURPOSE OF THE MEETING
At the Annual meeting, holders of Dakota common stock of record as of
the close of business on March 1, 2002 will be eligible to vote upon:
ITEM 1. Election of Directors:
Our shareholders elect the members of the Board of Directors annually.
Current nominations are for Gregg Giuffria, Veldon Simpson, and Richard
Hannigan. The nominees have consented to their nomination to the Board of
Directors, and will serve if elected. However, if any nominee should become
unable or unwilling for good cause to serve for any reason, proxies may be
voted for another person nominated as a substitute by the Board of Directors,
or the Board of Directors may reduce the number of Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ELECTION OF GREGG GIUFFRIA,
VELDON SIMPSON AND RICHARD HANNIGAN.
ITEM 2. Change of fiscal year from October 31 to December 31:
The Company is proposing to change its year-end from 10/31 to 12/31. The
basis for the year-end change is to harmonize the release of the Company's
quarterly and annual financial statements and operating results with the
release of similar information by the majority of the companies in its
industry. This will facilitate the comparison of the Company's financial and
operating performance to other companies in its peer group.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR CHANGE OF FISCAL YEAR FROM
OCTOBER 31 TO DECEMBER 31.
ITEM 3. Change of name from Dakota Imaging, Inc. to Voyager Entertainment
International, Inc.:
On February 8, 2002, pursuant to a reverse triangular merger, Voyager
Ventures, Inc. became our wholly-owned subsidiary. As a result of this
merger, our business focus and plan were changed to become an Entertainment
and Themed Attraction company primarily focusing on the construction of
unique new attractions throughout the World.
The Company's first major project will be to design, finance, develop and
manage a unique new attraction to be located on the Las Vegas Strip. It is
the intention of the Company to build the world's largest Ferris wheel with
33 vehicles called Sky Cruiser's. The vertical revolving vehicles will
overlook the Las Vegas Strip as it revolves higher than a 50-story building
at 518 feet. One slow rotation in a vehicle will last 24 minutes and each
vehicle will travel at 0.652 MPH.
In connection with the merger our Board of Directors believes it is important
that our corporate name be reflective of our future business enterprise.
Accordingly, our Board of Directors has unanimously approved "Voyager
Entertainment International, Inc." as our corporate name. If the name change
is approved by the shareholders our Certificate of Incorporation will have to
be amended and filed with the North Dakota Secretary of State in order to
make the name change effective. A copy of the Amendment to the Certificate of
Incorporation is attached hereto as Exhibit A.
The proposed amendment reads as follows:
A. Paragraph 1 shall be deleted in its entirety and the following inserted
in lieu thereof:
Article 1. The name of the corporation as reflected in the Articles of
Incorporation on file with the Secretary of State.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
If the shareholders vote in favor of the name change, certificates for
shares of the Company's common stock issued under Dakota Imaging, Inc.'s name
will continue to represent the same interest in the Company under the new
name. IT WILL NOT BE NECESSARY FOR SHAREHOLDERS TO EXCHANGE THEIR COMPANY
STOCK CERTIFICATES, ALTHOUGH SHAREHOLDERS MAY EXCHANGE THEIR CERTIFICATES IF
THEY WISH, AT THEIR SOLE EXPENSE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NAME CHANGE TO VOYAGER
ENTERTAINMENT INTERNATIONAL, INC.
ITEM 4. Amend the Company's Certificate of Incorporation:
The Company is proposing to amend its Certificate of Incorporation to
provide for holders of a majority of the Company's voting stock to take
corporate action by written consent, without having to submit the action to a
vote of all of the shareholders.
Pursuant to current North Dakota law (section 10-19.1-75 (1)) "If the
articles so provide, any action may be taken by written action signed by the
shareholders who own voting power equal to the voting power that would be
required to take the same action at a meeting of the shareholders at which
all shareholders were present."
Additionally, Section 14(c) and Schedule 14C of the Securities Exchange
Act of 1934 requires that if action is being taken by written consent when a
special or annual meeting to solicit shareholders would otherwise by
required, we must deliver an information statement, pursuant to the above
mentioned rule, 20 calendar days prior to the taking of such corporate
action. This coincides with the changes made to the Amended and Restated
Bylaws.
This proposal has the effect of eliminating the need for a shareholders
vote in situations where a majority of the shareholders are willing to
approve of a matter in writing without a meeting. This saves the expense of a
shareholders meeting, in addition to saving on the cost of expensive proxy
solicitation material. However, as a result of proxy rule 14(c ) the
shareholders would receive information on the action to be taken, 20 days in
advance of the action, providing time for the shareholders to take action
against the majority consent. The negative impact of this amendment is that
minority shareholders will not have the ability to share their opinions at a
meeting of the shareholders.
The proposed amendment reads as follows:
The following shall be added as Article 6.
Pursuant to Section 10-19.1-75 of the North Dakota Business Corporation Act,
any action which may be taken at any annual or special meeting of
shareholders may be taken without a meeting and without prior notice, if a
consent in writing, setting forth the action so taken, is signed by the
holders of outstanding shares having not less than the minimum number of
votes that would be necessary to authorize or take such action at a meeting
at which all shares entitled to vote thereon were present and voted. All
such consents shall be filed with the secretary of the corporation and shall
be maintained in the corporate records. Any shareholder giving a written
consent, or the shareholder's proxy holders, or a transferee of the shares of
a personal representative of the shareholder of their respective proxy
holders, may revoke the consent by a writing received by the secretary of the
corporation prior to the time that written consents of the number of shares
required to authorize the proposed action have been filed with the secretary.
A notice of action to be taken by majority stockholder consent shall be sent
or otherwise given in a manner in accordance with Section 5 of Article II of
the Bylaws, not less than twenty (20) calendar days prior to the earliest
date on which the corporate action may be taken. The notice shall specify:
(i) the general nature of the corporate action(s) to be taken;(ii) the date
on which the majority stockholder consent was given; (iii) the effects of the
action(s) on the corporation and/or its stockholders; and (iv) any conflicts
of interest that are present with regards to the action(s) to be taken
between the corporation's officers, directors and/or their affiliates. A
shareholder who does not sign or consent to the written action has no
liability for the action or actions taken by the written actions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE AMENDMENT TO THE CERTIFICATE
OF INCORPORATION.
ITEM 5. Amend and restate the Company's Bylaws:
The original Bylaws of Dakota were initially created for a closely held
corporation. The Amended Bylaws are better suited to the corporate governance
necessary to effectively operate as a public company. The following
represent the material changes which are being proposed for the Company:
1. Current Bylaws set the annual shareholder's meeting on February 15th of
each year.
Proposed Bylaws - Article II, Section 2. sets the annual meeting at a date
and time to be designated by the board of directors.
EXPLANATION: This amendment allows the Company flexibility in setting its
annual shareholder meeting to coincide with the 10-KSB filing and submittal
of annual reports to the shareholders.
2. Current Bylaws provide for special meetings to be called by all of the
directors, provided there are no more than three. If there are more than
three, by any three directors.
Proposed Bylaws - Article II, Section 3 provides for special meetings to be
called at the request in writing of a majority of the board of directors, or
at the request in writing of shareholders holding shares in the aggregate
entitled to cast not less than a majority of the votes at any such meeting.
EXPLANATION: This amendment prevents one director from delaying corporate
action while at the same time providing the majority shareholders the
opportunity to call a special meeting.
3. Current Bylaws provide for notice of shareholders' meetings to be given
at least 10 days prior to the meeting. There is no provision requiring
notice to contain the nature of business to be transacted.
Proposed Bylaws - Article II, Section 4 requires notice to be given not less
than ten (10) nor more than sixty (60) days before the date of the meeting.
The proposed bylaw also requires the notice to state the general nature of
the business to be transacted and also adds language providing that, if
action is proposed to be taken at any meeting for approval of (i) contracts
or transactions in which a director has a direct or indirect financial
interest (ii) an amendment to the articles of incorporation, (iii) a
reorganization of the corporation, (iv) dissolution of the corporation, or
(v) a distribution to preferred shareholders, the notice shall also state the
general nature of such proposal.
EXPLANATION: This amendment, by causing the management to state the nature
of business being transacted in the shareholders' meeting, provides a
shareholder with advance notice of what is to be discussed and voted on,
which provides a further opportunity to determine the shareholder's position
on the issue. Further, the requirement coincides with 14(a) proxy rules under
the Securities Exchange Act of 1934.
4. Current Bylaws provide for (1) notice to be given either personally or
by mail (2) makes no discussion for future notices in the event notice is
returned to the corporation marked to indicate that the United States Postal
Service is unable to deliver and (3) does not require affidavit of mailing of
notice.
Proposed Bylaws - Article II, Section 5 would allow for (1) notice to be
given either personally, by mail, telegraphic or by other written
communication, (2) in the event notice is returned from the United States
Postal Service marked to indicate that they are unable to deliver at such
address, all future notices or reports shall be deemed to have been duly
given without further mailing if the same shall be available to the
shareholder upon written demand of the shareholder and (3) provides that an
affidavit of mailing or other means of giving notice of any shareholders'
meeting shall be executed by the person giving such notice and shall be filed
and maintained in the minute book of the corporation.
EXPLANATION: This amendment places a burden on the shareholder to provide a
change of address to the Company in the event a change of address for the
shareholder actually occurred. The amendment saves potential additional costs
to the corporation in tracking down shareholders or continuous mailing to
improper addresses.
5. Current bylaws provide that, in the event of adjournment due to a quorum
not being present, the shareholders present may adjourn the meeting to some
other date and new notice shall be mailed at least 10 days prior to the
meeting date.
Proposed Bylaws - Article II, Section 7, allows adjournment by the vote of
the majority of the shares represented at such meeting, either in person or
by proxy, but in the absence of a quorum, no other business may be transacted
at such meeting. When any meeting of shareholders, either annual or special,
is adjourned to another time or place, notice need not be given of the
adjourned meeting if the time and place thereof are announced at a meeting at
which the adjournment is taken.
EXPLANATION: This eliminates duplicative notice resulting in additional
expenses to the Company.
6. Current Bylaws do not discuss voting.
Proposed Bylaws - Article II, Section 8, describes in detail who may vote and
the procedure for voting.
EXPLANATION: This amendment clarifies the details of the voting process,
which is one of the most important aspects of corporate governance.
7. Current Bylaws require action by written consent without a meeting to be
signed by all shareholders.
Proposed Bylaws - Article II, Section 10 allows for action by written consent
without a meeting if a consent in writing, setting forth the action so taken
is signed by the holders of outstanding shares having not less than the
minimum number of votes that would be necessary to authorize to take such
action at a meeting at which all shares entitled to vote thereon were
present.
Proposed Bylaws - Article II, Section 11, provides that, in the event action
is taken by majority consent, notice shall be given to each shareholder not
less than twenty (20) calendar days prior to the earliest date on which the
corporate action may be taken.
EXPLANATION: This amendment allows the majority shareholders to take action
without the expense of a shareholder's meeting. Additionally, the amendment
provides for notice 20 days in advance of the action taken, providing the
shareholders with ample opportunity to attempt to disrupt the action.
Further, the 20 day notice period falls in line with 14(c ) of the proxy
rules under the Securities Exchange Act of 1934.
8. Current Bylaws do not describe proxies and proxy procedure. They
basically state that shareholders may vote by proxy, but do not describe the
proxy procedure.
Proposed Bylaws - Article II, Section 12, describes proxies and the proxy
procedure in detail.
EXPLANATION: This amendment enhances the ability of the Company to operate
under the corporate governance which is requisite in the operation of a
public company.
9. Current Bylaws do not provide for an Inspector of Election.
Proposed Bylaws - Article II, Section 13 provides for an Inspector of
Election and the duties of the inspector.
EXPLANATION: This amendment provides for verification of the votes required
to take corporate action. It further creates a responsibility in the
inspector.
10. Current Bylaws do not list powers of the directors.
Proposed Bylaws - Article III, Section 1 describes the powers of the
directors in detail.
EXPLANATION: The purpose of this amendment is to provide the corporate
governance constraints on the board of directors, and further, provide the
shareholders with an understanding as to what authority the board of
directors has over the management of the company.
11. Current Bylaws requirement is "at least two directors". This Bylaw does
set a maximum number of directors.
Proposed Bylaws - Article III, Section 2 authorize the number of directors to
be no fewer than one (1) nor more than seven (7). The exact number of
authorized directors shall be set by resolution of the board of directors,
within the limits specified above.
EXPLANATION: Although this provision has the effect of potentially reducing
the number of directors from the previous two directors, it allows one
director, if necessary to operate the Company until another director is
nominated. Additionally, by providing for seven (7) directors, there is
sufficient provision for two outside directors as required by some stock
exchanges.
12. Current Bylaws discuss briefly the resignation and removal of directors
and the filling of vacancies. The basic requirements are similar to the
proposed bylaws.
Proposed Bylaws - Article III, Sections 4 and 5 discuss in more detail the
resignation and removal of directors process and the procedure for filling
vacancies.
EXPLANATION: This amendment clarifies the resignation and removal process
of directors.
13. Current Bylaws do not provide for set annual meetings of directors.
Proposed Bylaws - Article III, Section 7 provides for an annual meeting of
directors to be held immediately following each annual meeting of
shareholders.
EXPLANATION: This amendment mandates at least one directors meeting, which
will assist the Company in its management oversight.
14. Current Bylaws give basic procedures for regular or special meetings of
directors.
Proposed Bylaws - Article III, Sections 8, 9, 10 and 11 describe in detail
the procedure for "Other Regular Meetings", "Special Meetings" , "Quorum" and
Waiver of Notice.
EXPLANATION: The existing Bylaws were insufficient in describing the
procedures for meetings of directors. The proposed Bylaws conform to the
detail required to operate a Company with greater corporate governance.
15. Current Bylaws do not provide for adjournment of directors meeting.
Proposed Bylaws - Article III, Sections 12 and 13 provide that a majority of
the directors present, whether or not constituting a quorum, may adjourn any
meeting to another time and place. Notice of the time and place of holding
an adjourned meeting need not be given, unless the meeting is adjourned for
more than twenty-four (24) hours.
EXPLANATION: This amendment allows the directors who showed up for a
properly called meeting to continue the meeting without the requirement of a
future notice, which notice may delay action required by the Board.
16. Current Bylaws do not provide for fees and compensation of directors.
Proposed Bylaws - Article III, Section 15 provides that directors and members
of committees may receive such compensation, if any, for their services, and
such reimbursement of expenses, as may be fixed or determined by resolution
of the board of directors.
EXPLANATION: This amendment allows the Company to compensate its directors,
which in turn is intended to provide a greater management team for the
Company.
17. Current Bylaws do not provide for Committees.
Proposed Bylaws - Article IV, Sections 1 and 2 provide for committees of
directors.
EXPLANATION: This amendment provides for committees of directors, such as
audit committees, compensation committees, or acquisition or merger
committees, required to operate a public company with disclosure requirement.
18. Current Bylaws do not have a provision for an office of Chief Executive
Officer and provides for the President to be the highest office.
Proposed Bylaws - Article V, Section 6 provides for a Chief Executive Officer
who shall be the principal executive officer of the corporation and, subject
to the control of the board of directors, shall, have general charge of the
business, affairs and property of the corporation and general supervision
over the officers, employees and agents.
Proposed Bylaws - Article V, Section 7 provides that the President shall be
the chief operating officer of the corporation and subject to the control of
the board of directors and supervision of the chief executive officer.
EXPLANATION: This amendment creates the opportunity for the Company to have
an additional executive officer, which provides additional management
oversight potential for the Company.
19. Current Bylaws briefly describe the duties of Vice Presidents, Secretary
and Treasurer.
Proposed bylaws - Article V, Sections 8, 9 and 10 describe the duties of Vice
Presidents, Secretary and Treasurer in detail.
EXPLANATION: This amendment assists the Company in its management
operations, by providing a better method of allocating responsibility.
20. Current Bylaws provide for the Indemnification of Officers and
Directors. This is a very basic indemnification and does not discuss the
indemnification process in any detail.
Proposed Bylaws Article VI, Sections 1, 2, 3, 4, 5, 6, 7, 8, 9, and 10
discuss the indemnification of directors, officers, employees and other
agents in detail, including, but not limited to, defense of action, required
approval, advance of expenses, insurance and retroactive effect.
EXPLANATION: Although the current Bylaws provide for Indemnification of
Officers and Directors, the new amendment is intended to clarify the basis of
indemnification, to prevent future litigation, which is expensive to the
Company. Additionally, by having greater clarity in the Indemnification, the
Company may attract better management in the future.
21. Current Bylaws do not make any formal provision or procedure for
maintaining records and books.
Proposed Bylaws Article VII, Section 1 requires the corporation to keep at
its principal executive office, or at the office of its transfer agent or
registrar, a record of shareholders.
Article VII, Sections 2, 3 and 5 require the corporation to maintain at its
principal executive office the original or copy of the bylaws as amended to
date, together with the accounting books and records and minutes of
proceedings of the shareholders and board of directors and any committee or
committees of the board of directors and a copy of any annual financial
statement and any income statement of the corporation for each quarterly
period of each fiscal year, and any accompanying balance sheet of the
corporation as of the end of each such period, that has been prepared by the
corporation.
EXPLANATION: Inherent in the ability to operate the Company, and provide
the required disclosure under the Securities Exchange Act of 1934, is a
requirement by management that they maintain proper records of the Company.
22. Current Bylaws have no provision for general corporate matters.
Proposed Bylaws - Article VIII provide for the following general corporate
matters.
Section 1. Record Date. This provision describes in detail the record date
for the purpose of determining the shareholders entitled to notice of any
meeting or to vote or entitled to receive payment of any dividend or other
distribution or allotment of any rights or entitled to exercise any rights in
respect of any other lawful action.
Section 2. Closing of Transfer Books. The directors may prescribe a period
not exceeding sixty (60) days prior to any meeting of the shareholders during
which no transfer of stock on the books of the corporation may be made, or
may fix a date not more than sixty (60) days prior to the holding of any such
meeting as the day as of which shareholders entitled to notice of and to vote
at such meeting shall be determined.
Section 3. Registered Shareholders. Describes registered shareholders.
Section 4. Checks, Drafts, Evidences of Indebtedness. Describes how all
checks, drafts, evidences of indebtedness are to be handled by the
corporation.
Section 5. Corporate Contracts and Instruments; How Executed. Sets an
execution procedure for contracts.
Section 6. Stock Certificates. Describes the corporation's stock
certificates, procedure for issuance and designates what officers may execute
the certificates.
Section 7. Dividends. Sets a procedure for the payment of dividends, if
any.
Section 8. Fiscal Year. Sets the Corporations fiscal year as December 31st.
Section 9. Seal. Describes what shall be inscribed on the corporate seal.
Section 10. Representation of shares of other corporations. Describes the
procedure for voting any and all shares of any other corporation or
corporations, foreign or domestic, standing in the name of the corporation.
Section 11. Construction and Definitions. Explains that, unless the context
requires otherwise, the general provisions, rules of construction, and
definitions in the North Dakota General Corporation Law shall govern the
construction of the bylaws.
EXPLANATION: This amendment was required as a result of the deficiencies in
the current Bylaws relative to corporate matters which are important for any
company, however significantly more important to a public company with added
disclosure and corporate governance issues.
POTENTIAL NEGATIVE CONSEQUENCES TO SHAREHOLDERS OF AMENDING AND RESTATING THE
BYLAWS.
7-Majority Consent. The proposed change to the Bylaws allowing for
actions to be taken by a vote of the Company's majority shareholders
negatively impacts minority shareholders by not allowing them the ability to
share their opinions at a meeting of the shareholders and not allowing them
to actually vote to approve or deny the action that is to be taken.
11-Change in Number of Directors. The proposed change to the Bylaws
allowing for there to be no fewer than 1 nor more than 7 directors may have a
negative effect on shareholders by allowing the Company to be governed by a
single director. In such a circumstance decisions would be made by a single
individual without the assistance of other board members. Because all
business and affairs of the Company and all corporate powers are managed
under the direction of the board of directors, a board of directors
consisting of one individual could have a material effect on the operations
of the Company. The single board member would have the authority to:
* Select and remove all officers, agents, and employees of the
corporation, prescribe such powers and duties for them as may not be
inconsistent with law, with the articles of incorporation or these bylaws,
fix their compensation, and require from them security for faithful service;
* Change the principal executive office or the principal business office
from one location to another; cause the corporation to be qualified to do
business in any other state, territory, dependency, or foreign country and
conduct business within or without the State; designate any place within or
without the State for the holding of any stockholders' meeting, or meetings,
including annual meetings; adopt, make and use a corporate seal, and
prescribe the forms of certificates of stock, and alter the form of such seal
and of such certificates from time to time as in their judgment they may deem
best, provided that such forms shall at all times comply with the provisions
of law;
* Authorize the issuance of shares of stock of the corporation from time
to time, upon such terms as may be lawful, in consideration of money paid,
labor done or services actually rendered, debts or securities cancelled,
tangible or intangible property actually received; and
* Borrow money and incur indebtedness for the purpose of the corporation,
and cause to be executed and delivered therefor, in the corporate name,
promissory notes, bonds, debentures, deeds of trust, mortgages, pledges,
hypothecations, or other evidences of debt and securities therefor.
16-Fees and Compensation to Directors. The proposed amendment to the Bylaws
allowing for director fees and compensation could have a negative effect on
the Company and its shareholders. Directors may become influenced to act in
an unethical fashion because of financial motivations. In addition, directors
that are independent (not officers or employees of the Company) may be
compelled, through the payment of fees or other compensation, to jeopardize
their independence and act in a manner contrary to the best interests of the
Company or its shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE AMENDMENT AND RESTATEMENT OF
THE BYLAWS.
ITEM 6. Ratify the appointment of MERDINGER, FRUCHTER, ROSEN & CORSO, P.C.
as the Company's new auditor:
The Company's Board of Directors has voted to engage MERDINGER, FRUCHTER,
ROSEN & CORSO, P.C. as its new independent auditor's for the fiscal year
ending December 31, 2002. CLYDE BAILEY P.C., of San Antonio, Texas, is the
current auditor of the Company. He has agreed to resign as auditor upon
approval of the shareholders of the ratification of MERDINGER, FRUCHTER,
ROSEN & CORSO, P.C.
The change in accountants does not result from any dissatisfaction with the
quality of professional services rendered by CLYDE BAILEY P.C. as the
Company's independent accountant. Please see the "INDEPENDENT AUDITORS"
section of this Proxy Statement for additional information on the change of
auditors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF MERDINGER,
FRUCHTER, ROSEN & CORSO, P.C. FOR THE YEAR ENDED DECEMBER 31, 2002.
ITEM 7. Authorization to adopt an Option Plan providing for Five Million
(5,000,000) shares of common stock:
The Company's Board of Directors has approved the 2002 Stock Option Plan. The
plan authorizes the Company to issue 5,000,000 shares of common stock for
issuance upon exercise of options. The plan is intended to encourage
directors, officers, employees and consultants of the Company to acquire
ownership of Common Stock. The opportunity so provided is intended to foster
in participants a strong incentive to put forth maximum effort for the
continued success and growth of the Company, to aid in retaining individuals
who put forth such efforts, and to assist in attracting the best available
individuals to the Company in the future. A copy of the option plan is
attached hereto as Exhibit C.
Officers (including officers who are members of the Board of Directors),
directors (other than members of the Stock Option Committee (the "Committee")
to be established to administer the Stock Option Plan) and other employees
and consultants of the Company and its subsidiaries (if established) will be
eligible to receive options under the planned Stock Option Plan. The
Committee will administer the Stock Option Plan and will determine those
persons to whom options will be granted, the number of options to be granted,
the provisions applicable to each grant and the time periods during which the
options may be exercised. No options may be granted more than ten years
after the date of the adoption of the Stock Option Plan.
Unless the Committee, in its discretion, determines otherwise, non-qualified
stock options will be granted with an option price equal to the fair market
value of the shares of Common Stock to which the non-qualified stock option
relates on the date of grant. In no event may the option price with respect
to an incentive stock option granted under the Stock Option Plan be less than
the fair market value of such Common Stock to which the incentive stock
option relates on the date the incentive stock option is granted.
Each option granted under the Stock Option Plan will be exercisable for a
term of not more than ten years after the date of grant. Certain other
restrictions will apply in connection with this Plan when some awards may be
exercised. In the event of a change of control (as defined in the Stock
Option Plan), the date on which all options outstanding under the Stock
Option Plan may first be exercised will be accelerated. Generally, all
options terminate 90 days after a change of control.
At the present time there is no intent to issue options under the plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE 2002 STOCK
OPTION PLAN.
ITEM 8. Adjourn or postpone the meeting for the purpose of soliciting
additional proxies.
The Company may adjourn or postpone the meeting to another day or time for
the purpose of soliciting additional proxies.
ITEM 9. Transaction of other business:
The Company may transact such other business as may properly come before the
Annual meeting or any adjournment or postponement thereof, however, the Board
of Director's knows of no matters, other than those outlined above, that will
be presented for action at the Annual Meeting.
RECORD DATE AND VOTING AT THE ANNUAL MEETING
The Board of Directors has fixed the close of business on March 1, 2002,
as the record date for the determination of the shareholders entitled to
notice of, and to vote at, the Annual meeting and any adjournments and
postponements of the Annual meeting. On that day, there were 34,015,000
shares of Dakota common stock outstanding, which shares were held by
approximately 67 shareholders of record. Holders of Dakota common stock are
entitled to one vote per share. Additionally, there were 1,500,000 shares of
Dakota preferred stock outstanding, which shares were held by the three
directors. Holders of the issued and outstanding preferred stock have 10:1
voting rights, which in the aggregate constitute 15,000,000 votes.
A majority of the issued and outstanding shares of Dakota common stock
on the record date, represented in person or by proxy, will constitute a
quorum for the transaction of business at the Annual meeting. If a quorum is
not present, the Annual meeting may be adjourned from time to time, until a
quorum is present. Abstentions and broker non-votes are counted as present
for purposes of determining the presence of a quorum at the Annual meeting
for the transaction of business.
VOTES REQUIRED
Approval of any Proposal requires the affirmative vote of holders of a
majority of the outstanding shares of Dakota common stock entitled to vote at
the Annual meeting. A failure to vote or a broker non-vote will have the same
legal effect as a vote cast against approval of any Proposal.
Brokers, and in many cases nominees, will not have discretionary power
to vote on the Proposals to be presented at the Annual meeting. Accordingly,
beneficial owners of shares must instruct their brokers or nominees how to
vote their shares at the Annual meeting.
SOLICITATION AND PROXY SOLICITOR
Dakota will bear all expenses of the solicitation of proxies in
connection with this proxy statement, including the cost of preparing and
mailing this proxy statement. Dakota will reimburse brokers, fiduciaries,
custodians and their nominees for reasonable out-of-pocket expenses incurred
in sending this proxy statement and other proxy materials to, and obtaining
instructions relating to such materials from, beneficial owners of Dakota
common stock. Dakota shareholder proxies may be solicited by directors,
officers and employees of Dakota strictly through the mailing of the proxy
statement only.
REVOCATION AND USE OF PROXIES
The enclosed proxy card is solicited on behalf of the Dakota Board of
Directors. A shareholder giving a proxy has the power to revoke it at any
time before it is exercised by (i) delivering a written notice revoking the
proxy to Dakota before the vote at the Annual meeting; (ii) executing a proxy
with a later date and delivering it to Dakota before the vote at the Annual
meeting; or (iii) attending the Annual meeting and voting in person. Any
written notice of revocation should be delivered to the attention of the
Corporate Secretary at Dakota, 4483 West Reno Avenue, Las Vegas, NV 89118.
Attendance at the Annual meeting without casting a ballot will not, by
itself, constitute revocation of a proxy.
Subject to proper revocation, all shares of Dakota common stock represented
at the Annual meeting by properly executed proxies received by Dakota will be
voted in accordance with the instructions contained in such proxies.
Executed, but unmarked, proxies will be voted "FOR" approval of the
Proposals.
ADJOURNMENTS OR POSTPONEMENTS
Although it is not expected, the Annual meeting may be adjourned or postponed
for the purpose of soliciting additional proxies. Any adjournment or
postponement of the Annual meeting may be made without notice, other than by
an announcement made at the Annual meeting, by approval of the holders of a
majority of the votes present in person or represented by proxy at the Annual
meeting, whether or not a quorum exists. Any adjournment or postponement of
the Annual meeting for the purpose of soliciting additional proxies will
allow Dakota shareholders who have already sent in their proxies to revoke
them at any time prior to their use.
INTEREST OF CERTAIN PERSONS IN
OR OPPOSITION TO MATTERS ACTED UPON
The Company is not aware of any interest that would be substantially
affected through the change of the Company's name, change of the year end to
12/31, amending the Certificate of Incorporation, amending and restating the
Bylaws, authorization of Option Plan, or change in auditors, whether
adversely or otherwise.
AUDIT COMMITTEE
The Board of Directors, elected not to incur the expense of an Audit
Committee. Therefore, at this time the Company does not have an Audit
Committee.
INDEPENDENT AUDITORS
The Company's Board of Directors has voted to engage MERDINGER, FRUCHTER,
ROSEN & CORSO, P.C., of Los Angeles, California, as its new independent
auditor's for the fiscal year ending December 31, 2002. CLYDE BAILEY P.C., of
San Antonio, Texas, is the current auditor of the Company. He has agreed to
resign as auditor upon approval of the shareholders of the ratification of
MERDINGER, FRUCHTER, ROSEN & CORSO, P.C.
The change in accountants does not result from any dissatisfaction with the
quality of professional services rendered by CLYDE BAILEY P.C. as the
Company's independent accountant.
A representative of MERDINGER, FRUCHTER, ROSEN & CORSO, P.C. is not expected
to be present at the Annual meeting.
Disagreements with Accountants on Accounting and Financial Disclosure
The audit reports issued by CLYDE BAILEY P.C. with respect to the
Company's year ended October 31, 2001 financial statements did not contain an
adverse opinion or disclaimer of opinion, and were not qualified as to
uncertainty, audit scope or accounting principles. There have been no
disagreements between the Company and CLYDE BAILEY P.C. on any matter of
accounting principles or practices, financial statement disclosure or
auditing scope or procedure, which disagreements, if not resolved to the
satisfaction of CLYDE BAILEY P.C., would have caused them to make a reference
to the subject matter of the disagreement in connection with their audit
report.
Audit Fees
For professional services rendered with respect to the audit of Dakota's
annual financial statements for the year ended October 31, 2001, Dakota paid
to CLYDE BAILEY P.C. fees in the amount of $3,750.
All Other Fees
Dakota paid $1,650 to CLYDE BAILEY P.C. for audit comment responses to the
Form SB-2 for the year ended October 31, 2001.
In view of the fact that Dakota did not pay to CLYDE BAILEY P.C. any fees in
its fiscal year ended October 31, 2001 other than fees for audit services and
audit related comment responses, the Board of Directors was not required to
consider whether the provision of services other than audit services by CLYDE
BAILEY P.C. is compatible with maintaining CLYDE BAILEY P.C. independence in
performing audit services.
CURRENT OFFICERS AND DIRECTORS
The directors are to be elected to the Board of Directors for one year to
serve until the 2003 Annual meeting of shareholders and until their
successors are elected and qualified.
The following table sets forth information regarding each nominee.
Current Positions and Offices
Name Age With Dakota
Gregg Giuffria 50 CEO, Chairman and Director
Richard L. Hannigan, Sr. 53 President, Secretary, Treasurer and Director
Veldon Simpson 61 Director
Gregg Giuffria, age 50, is Chairman of the Board/Chief Executive Officer and
Director of Dakota Imaging, Inc. Mr. Giuffria was a member of Outland
Development LLC from October, 2000 through the Voyager transaction, January
30, 2002. From April, 1997 to October, 2000, Mr. Giuffria served as President
and COO of Full House Resorts, Inc. The companies business is the
development and management of hotel, casino, resort and amusement park
projects. From November, 1995 to November, 1996, Mr. Giuffria was vice-
president of corporate development for Casino Data Systems, Inc. Casino Data
Systems, Inc.'s business was data and accounting software and slot machine
manufacturing. Mr. Giuffria also owned and controlled the patent rights and
sub-license rights of "The Telnaes Patent," a gaming and casino patent.
These rights were subsequently sold to Casino Data Systems, Inc. and
International Game Technology; sublicenses were granted to other companies as
well.
Richard L. Hannigan, Sr., age 53, is President/Secretary/Treasurer and
Director of Dakota Imaging, Inc. Mr. Hannigan has been President of a
design/construction company, Synthetic Systems, Inc. since 1991. This
company specializes in custom designs for interior and exterior casino
construction. Under Mr. Hannigan's control Synthetic Systems, Inc. has been
involved in several casino projects in Las Vegas, including the Luxor Hotel
Casino, interior themed areas and exterior main entry Sphinx. Prior to
Synthetic Systems, Inc., Mr. Hannigan owned and operated two consulting and
construction companies from 1983-1991. These companies, Architectural
Services, Inc. and Architectural Systems, Inc., respectively have been
responsible for construction projects located in Las Vegas, Palm Springs, Los
Angeles and Salt Lake City. Mr. Hannigan, consulted for exterior glazing and
exotic fenestrations on commercial as well as casino companies, in Las Vegas.
Veldon Simpson, age 61, is a Director of Dakota Imaging, Inc. Mr. Simpson
graduated from Arizona State University's five year architectural Program and
holds Masters Degree in Architecture. Mr. Simpson, for the past 35 years has
been the owner of Veldon Simpson-Architect, Inc., the Architect of Record for
many projects and each of the projects was personally designed by Mr.
Simpson, some of the projects are: MGM Grand Hotel & Casino, Excalibur Hotel
& Casino, Luxor Hotel & Casino, Circus-Circus Skyrise Hotel, Colorado Belle
Hotel & Casino, Edgewater Hotel & Casino, San Remo Hotel & Casino, Avi Hotel
& Casino, Casa Blanca Hotel & Casino, Riviera Hotel & Casino, Dobson Ranch
Inn, & Scottsday Inn, Casino Royale, Waco Casino in Sanya City, Hainan
Province, Mainland China, Remodeled the Dunes Casino, and the Sands Casino &
Expo Center, Palace Station Hotel & Casino, Big Bear California Sky Lodge and
The Inn at The Space Needle in Seattle, WA. As Architect of Record for the
World's Largest Casino's, the company of Veldon Simpson-Architect, Inc., was
rated #1 in the USA for the years 1991-1993.
There are no family relationships between any of the above persons
Executive officers are to be elected by the Board of Directors of Dakota at
its meeting of directors held immediately following the Annual meeting of
shareholders to serve for the ensuing year or until their successors have
been elected. There are no arrangements or understandings between any officer
and any other person pursuant to which the officer is to be elected.
BOARD OF DIRECTORS MEETINGS
The Board of Directors of Dakota met once during the fiscal year ended
October 31, 2001.
INSIDER PARTICIPATION IN COMPENSATION DECISIONS
The Company has no separate Compensation Committee; the entire Board of
Directors makes decisions regarding executive compensation.
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION
The Board of Directors has no existing policy with respect to the specific
relationship of corporate performance to executive compensation. The Board
has set executive compensation at what the Board considered to be the minimal
levels necessary to retain and compensate the officers of the company for
their activities on the Company's behalf.
EXECUTIVE COMPENSATION
The compensation which the Company accrued or paid to the Officers for
services in all capacities and for the fiscal years indicated, was as
follows:
Long Term
Annual Compensation Compensation
Other Annual Restricted
Name Year Salary Bonus Compensation Stock Options
Lawrence 2001 $154,073 -0- -0- -0- -0-
Nieters (1)- 2000 $162,500 -0- -0- -0- -0-
Former 1999 $162,500 -0- -0- -0- -0-
President,
Treasurer and
Director
JoEll Nieters 2001 $19,333 -0- -0- -0- -0-
(2)- Former 2000 $16,000 -0- -0- -0- -0-
Vice President, 1999 $16,000 -0- -0- -0- -0-
Secretary and
Director
Frances Hedman 2001 -0- -0- -0- -0- -0-
(3)- Former 2000 -0- -0- -0- -0- -0-
Director 1999 -0- -0- -0- -0- -0-
Gregg Giuffria 2002 -0- -0- -0- -0- -0-
(4)- CEO and
Director
Richard 2002 -0- -0- -0- -0- -0-
Hannigan (4)-
President,
Secretary,
Treasurer and
Director
Veldon Simpson 2002 -0- -0- -0- -0- -0-
(4)- Director
(1) Mr. Nieters served as the Company's President, Treasurer and a Director
from its inception in 1991 through February 8, 2002. From October 31, 2001 to
February 8, 2002 Mr. Nieters was paid cash compensation of $39,350.
(2) Mrs. Nieters served as the Company's Vice President, Secretary and a
Director from its inception in 1991 through February 8, 2002. From October
31, 2001 to February 8, 2002 Mrs. Nieters was paid cash compensation of
$4,825.
(3) Mr. Hedman served as a Director of the Company from its inception in
1991 through February 8, 2002.
(4) Messieurs Giuffria, Hannigan and Simpson were appointed as directors and
elected as officers of the Company on February 8, 2002. The Company has not
formally established a compensation plan for any of these individuals and
through the date of this Proxy Statement none of the individuals have
received any monetary compensation from the Company.
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
The following table sets forth the beneficial ownership of the Company's
common stock of each beneficial owner of more than 5% of the common stock,
director, officer, and all directors and officers of the Company as a group:
Number Number
of Shares Percent of Shares Percent
Name of Owner (1) Common Of Preferred Of
Class (3) Class
(2) (2)
Officers and Directors of the
Registrant
Gregg Giuffria, CEO & Director
(4) 6,000,000 18% 500,000 33.33%
Richard Hannigan, President,
Secretary, Treasurer & Director (4)
6,000,000 18% 500,000 33.33%
Veldon Simpson, Director (4) 6,000,000 18% 500,000 33.33%
Officers and Directors as a Group 18,000,000 54% 1,500,000 100%
Beneficial Owners
Rainbird Trust (5) 3,600,000 11% -0- -0-
Brian Gale 1,750,000 5% -0- -0-
Chad Kunz 2,250,000 7% -0- -0-
Dale Nelson 1,750,000 5% -0- -0-
Beneficial Owners as a Group 9,350,000 28% -0- -0-
Officers, Directors and Beneficial
Owners as a Group 27,350,000 82% 1,500,000 100%
(1) As used in this table, "beneficial ownership" means the sole or shared
power to vote, or to direct the voting of, a security, or the sole or shared
investment power with respect to a security (i.e., the power to dispose of,
or to direct the disposition of, a security).
(2) Figures are rounded to the nearest percentage.
(3) The Series A Preferred Converts to Common Stock at 1 share of Preferred
for 10 shares of Common. Each share of Series A Preferred has 10 to 1 voting
rights.
(4) Messieurs Giuffria, Hannigan and Simpson acquired there shares on
February 8, 2002 as part of the tri-party reverse merger with Voyager
Ventures, Inc. Each of the individuals were shareholders of Voyager and were
each issued 1,100,000 shares of Series A preferred stock in exchange for
their Voyager shares. Immediately upon closing of the merger each of the
individuals converted 600,000 shares of the Series A preferred stock thereby
resulting in their current holdings.
(5) Rainbird Trust acquired its shares on February 8, 2002 as part of the
tri-party reverse merger with Voyager Ventures, Inc. The Trust was a
shareholder of Voyager and was issued 360,000 shares of Series A preferred
stock in exchange for its Voyager shares. Immediately upon closing of the
merger the Trust converted all of its Series A preferred stock thereby
resulting in its current holdings. The dispositive and voting control of the
Rainbird Trust is shared by Barton E. Shapkin and Loretta Davis,
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under the securities laws of the United States, the Company's directors,
its executive officers, and any persons holding ten percent (10%) or more of
the Company's Common Stock must report on their ownership of the Company's
Common Stock and any changes in that ownership to the Securities and Exchange
Commission. Specific due dates for these reports have been established.
During the year ended October 31, 2001, all of the Company's officers and
directors were late in filing their initial holdings on Form 3. Other than
the late filing of the Form 3's, the Company believes that all reports
required to be filed by Section 16(a) were filed on a timely basis.
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
The Company's wholly-owned subsidiary, Voyager Ventures, Inc., has numerous
related party transactions with Synthetic Systems, Inc. ("Synthetic").
Synthetic is a company owned 100% by Richard Hannigan, Sr., President of the
Company. Synthetic advances funds when needed for operating purposes. These
advances bear interest at 5% per annum and are payable upon demand. Interest
expense totaled $150, $2,000 and $1,500, respectively, as of January 31,
2002, and December 31, 2001 and 2000. As of January 31, 2002, Voyager had a
balance due to Synthetic in the amount of $46,356.
Additionally, Voyager has received funds from Greg Giuffria and Veldon
Simpson, both officers and directors of the Company, from time to time in the
past. As of January 31, 2002, Voyager had a balance due to Mr. Giuffria of
$1,884 and a balance due to Mr. Simpson of $834.
SHAREHOLDER PROPOSALS FOR THE 2003 ANNUAL MEETING
Qualified shareholders who want to have proposals presented at the 2003
annual meeting must deliver them to the Company by December 1, 2002, in order
to be considered for inclusion in next year's proxy statement and proxy.
OTHER MATTERS
As of the date of this proxy statement, the Board of Directors does not
intend to bring any other business before the Annual meeting of Dakota
shareholders and, so far as is known to the Board of Directors, no matters
are to be brought before the Annual meeting except as specified in the notice
of Annual meeting. However, as to any other business that may properly come
before the Annual meeting, the proxy holders intend to vote the proxies in
respect thereof in accordance with the recommendation of the Board of
Directors.
EXPENSES OF PROXY SOLICITATION
The principal solicitation of proxies will be made by mail. However, certain
officers of the Company, none of whom will be compensated therefore, may
solicit proxies by letter, telephone or personal solicitation. Expense of
distributing this Proxy Statement to shareholders, which may include
reimbursements to banks, brokers, and other custodians for their expenses in
forwarding this Proxy Statement, will be borne exclusively by Dakota.
WHERE YOU CAN FIND MORE INFORMATION
Dakota files Annual, quarterly and Annual reports, proxy statements and other
information with the Securities and Exchange Commission. You may read and
copy any reports, statements or other information that Dakota files with the
Securities and Exchange Commission at the Securities and Exchange
Commission's website at "http://www.sec.gov."
Shareholders may obtain documents by requesting them in writing or by
telephone from the Dakota at the following address:
DAKOTA IMAGING, INC.
4483 West Reno Avenue
Las Vegas, NV 89118
(702) 221-8070
You should rely only on the information contained in this proxy statement. We
have not authorized anyone to provide you with information that is different
from what is contained in this proxy statement. This proxy statement is dated
March 20, 2002. You should not assume that the information contained in this
proxy statement is accurate as of any date other than that date.
FRONT SIDE OF PROXY
PROXY
DAKOTA IMAGING, INC.
4483 West Reno Avenue
Las Vegas, NV 89118
(702) 221-8070
ANNUAL MEETING OF SHAREHOLDERS
April 4,2, 2002
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF DAKOTA IMAGING, INC.
The undersigned shareholder of DAKOTA IMAGING, INC., a North Dakota
corporation (the "Company"), hereby appoints Richard Hannigan, as proxy, with
the power to appoint his or her substitute, and hereby authorizes either of
them to represent, and to vote as designated on the reverse side, all the
shares of common stock of Dakota Imaging, Inc. held of record by the
undersigned on March 1, 2002, at the Annual Meeting of Shareholders of Dakota
Imaging, Inc., to be held at The Conference Room, Suite 115111 - 1850 E.
Flamingo Road, Las Vegas, Nevada 89119, on April 42 2002, at 10:00 a.m. local
time and at all adjournments or postponements thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY
WILL BE VOTED FOR THE BOARD OF DIRECTORS AS NOMINATED, THE CHANGE OF YEAR END
TO 12/31, THE CHANGE OF NAME, THE AMENDMENT TO THE CERTIFICATE OF
INCORPORATION, THE AMENDMENT AND RESTATEMENT OF THE BYLAWS, THE APPOINTMENT
OF THE ACCOUNTING FIRM OF MERDINGER, FRUCHTER, ROSEN & CORSO, P.C., AND THE
ADOPTION OF THE STOCK OPTION PLAN.
[X] PLEASE MARK YOUR VOTES AS INDICATED IN THIS EXAMPLE
THE BOARD OF DIRECTORS OF DAKOTA IMAGING, INC. RECOMMENDS A VOTE FOR THE
PROPOSALS SET FORTH BELOW.
1. Proposal to approve the following Directors to serve through the next
year, Gregg Giuffria, Veldon Simpson, and Richard Hannigan;
Gregg Giuffria [ ] FOR [ ] AGAINST [ ] ABSTAIN
[ ] WITHHOLD VOTE
Veldon Simpson [ ] FOR [ ] AGAINST [ ] ABSTAIN
[ ] WITHHOLD VOTE
Richard Hannigan [ ] FOR [ ] AGAINST [ ] ABSTAIN
[ ] WITHHOLD VOTE
2. To change the Company's fiscal year end to December 31:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. To change the name of Dakota Imaging, Inc. to Voyager Entertainment
International, Inc.;
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. To amend the Company's Certificate of Incorporation;
[ ] FOR [ ] AGAINST [ ] ABSTAIN
5. To amend and restate the Company's Bylaws;
[ ] FOR [ ] AGAINST [ ] ABSTAIN
6. Ratify the appointment of MERDINGER, FRUCHTER, ROSEN & CORSO, P.C. as
the Company's auditor;
[ ] FOR [ ] AGAINST [ ] ABSTAIN
7. To adopt a stock option plan providing for options on up to 5 million
shares of common stock;
[ ] FOR [ ] AGAINST [ ] ABSTAIN
8. To adjourn or postpone the meeting for the purpose of soliciting
additional proxies.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
THIS PROXY ALSO DELEGATES DISCRETIONARY AUTHORITY WITH RESPECT TO ANY OTHER
MATTER UNKNOWN A REASONABLE TIME BEFORE THE SOLICITATION, WHICH MAY PROPERLY
COME BEFORE THE MEETING OR ANY MATTERS INCIDENT TO THE CONDUCT OF THE ANNUAL
MEETING. THE UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT OF THE NOTICE OF ANNUAL
MEETING AND PROXY STATEMENT.
Date: ___________________, 2002
_______________________________ ____________________________________
(Signature) (Joint Owner's Signature)
Please sign exactly as your name appears on proxy. When signing as attorney,
guardian, executor, administrator or trustee, please give title. If the
signer is a corporation, give the full corporate name and sign by a duly
authorized officer, showing the officer's title. EACH joint owner is
requested to sign.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
EXHIBIT A
AMENDMENT TO CERTIFICATE
OF INCORPORATION OF
DAKOTA IMAGING, INC.
1. The name of the corporation as reflected in the Articles of
Incorporation on file with the Secretary of State
Dakota Imaging, Inc.
2. Federal ID#
45-0420093
4. Complete mailing address of the principal place of business:
4483 West Reno Avenue
Las Vegas, NV 89118
6. The following amendment has been adopted pursuant to the provisions of
the North Dakota Business Corporation Act, North Dakota Century Code,
Chapter 10-19-1:
I, the undersigned, Richard Hannigan, do hereby certify:
That the Board of Directors of Dakota Imaging, Inc. ("the
Company"), at a meeting duly convened and held on the 8th day of
February, adopted a resolution to amend the original articles as
follows:
A. Paragraph 1 shall be deleted in its entirety and the following
inserted in lieu thereof:
1. The Name of the corporation as reflected in the Articles of
Incorporation on file with the Secretary of State.
VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
B. The following shall be added as Article 6.
Pursuant to Section 10-19.1-75 of the North Dakota Business Corporation
Act, any action which may be taken at any annual or special meeting of
stockholders may be taken without a meeting and without prior notice, if
a consent in writing, setting forth the action so taken, is signed by
the holders of outstanding shares having not less than the minimum
number of votes that would be necessary to authorize or take such action
at a meeting at which all shares entitled to vote thereon were present
and voted. All such consents shall be filed with the secretary of the
corporation and shall be maintained in the corporate records. Any
stockholder giving a written consent, or the stockholder's proxy
holders, or a transferee of the shares of a personal representative of
the stockholder of their respective proxy holders, may revoke the
consent by a writing received by the secretary of the corporation prior
to the time that written consents of the number of shares required to
authorize the proposed action have been filed with the secretary.
A notice of action to be taken by majority stockholder consent shall be
sent or otherwise given in a manner in accordance with Section 5 of
Article II of the Bylaws, not less than twenty (20) calendar days prior
to the earliest date on which the corporate action may be taken. The
notice shall specify: (i) the general nature of the corporate action(s)
to be taken; (ii) the date on which the majority stockholder consent was
given; (iii) the effects of the action(s) on the corporation and/or its
stockholders; and (iv) any conflicts of interest that are present with
regards to the action(s) to be taken between the corporation's officers,
directors and/or their affiliates. A Shareholder who does not sign or
consent to the written action has no liability for the action or actions
taken by the written actions.
7. The Amendment shall be effective upon Shareholder consent.
8. The amendment was adopted on ___________ at a meeting of shareholders
where a quorum was present and _____% of the issued and outstanding
shares voted in favor of the amendment either in person or by proxy.
9. The shares of the Corporation are unaffected by the amendment.
10. The undersigned, a person authorized by the corporation to sign the
amendment, has read the foregoing Articles of Amendment, knows the
contents thereof, and believes the statements made thereon to be true.
DATED: ______________
______________________________
RICHARD HANNIGAN
President
11. Name of person to contact about this amendment: Debbie Amigone
E-Mail Address securities@securitieslawinstitute.com
Daytime Telephone No.: (702) 866-5800
EXHIBIT B
AMENDED AND RESTATED
BYLAWS
OF
DAKOTA IMAGING, INC.
(to be known as VOYAGER ENTERTAINMENT INTERNATIONAL, INC.)
a North Dakota corporation
ARTICLE I
OFFICES
Section 1. PRINCIPAL OFFICES. The principal office shall be in
the City of Las Vegas, County of Clark, State of Nevada.
Section 2. OTHER OFFICES. The board of directors may at any
time establish branch or subordinate offices at any place or places where the
corporation is qualified to do business.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. PLACE OF MEETINGS. Meetings of stockholders shall
be held at any place within or without the State of North Dakota designated
by the board of directors. In the absence of any such designation,
stockholders' meetings shall be held at the principal executive office of the
corporation.
Section 2. ANNUAL MEETINGS. The annual meetings of
stockholders shall be held at a date and time designated by the board of
directors. (At such meetings, directors shall be elected and any other
proper business may be transacted by a plurality vote of stockholders.)
Section 3. SPECIAL MEETINGS. A special meeting of the
stockholders, for any purpose or purposes whatsoever, unless prescribed by
statute or by the articles of incorporation, may be called at any time by the
president and shall be called by the president or secretary at the request in
writing of a majority of the board of directors, or at the request in writing
of stockholders holding shares in the aggregate entitled to cast not less
than a majority of the votes at any such meeting.
The request shall be in writing, specifying the time of such
meeting, the place where it is to be held and the general nature of the
business proposed to be transacted, and shall be delivered personally or sent
by registered mail or by telegraphic or other facsimile transmission to the
chairman of the board, the president, any vice president or the secretary of
the corporation. The officer receiving such request forthwith shall cause
notice to be given to the stockholders entitled to vote, in accordance with
the provisions of Sections 4 and 5 of this Article II, that a meeting will be
held at the time requested by the person or persons calling the meeting, not
less than thirty-five (35) nor more than sixty (60) days after the receipt of
the request. If the notice is not given within twenty (20) days after
receipt of the request, the person or persons requesting the meeting may give
the notice. Nothing contained in this paragraph of this Section 3 shall be
construed as limiting, fixing or affecting the time when a meeting of
stockholders called by action of the board of directors may be held.
Section 4. NOTICE OF STOCKHOLDERS' MEETINGS. All notices of
meetings of stockholders shall be sent or otherwise given in accordance with
Section 5 of this Article II not less than ten (10) nor more than sixty (60)
days before the date of the meeting being noticed. The notice shall specify
the place, date and hour of the meeting and (i) in the case of a special
meeting the general nature of the business to be transacted, or (ii) in the
case of the annual meeting those matters which the board of directors, at the
time of giving the notice, intends to present for action by the stockholders.
The notice of any meeting at which directors are to be elected shall include
the name of any nominee or nominees which, at the time of the notice,
management intends to present for election.
If action is proposed to be taken at any meeting for approval of
(i) contracts or transactions in which a director has a direct or indirect
financial interest, (ii) an amendment to the articles of incorporation, (iii)
a reorganization of the corporation, (iv) dissolution of the corporation, or
(v) a distribution to preferred stockholders, the notice shall also state the
general nature of such proposal.
Section 5. MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE.
Notice of any meeting of stockholders shall be given either personally or by
first-class mail or telegraphic or other written communication, charges
prepaid, addressed to the stockholder at the address of such stockholder
appearing on the books of the corporation or given by the stockholder to the
corporation for the purpose of notice. If no such address appears on the
corporation's books or is given, notice shall be deemed to have been given if
sent by mail or telegram to the corporation's principal executive office, or
if published at least once in a newspaper of general circulation in the
county where this office is located. Personal delivery of any such notice to
any officer of a corporation or association or to any member of a partnership
shall constitute delivery of such notice to such corporation, association or
partnership. Notice shall be deemed to have been given at the time when
delivered personally or deposited in the mail or sent by telegram or other
means of written communication. In the event of the transfer of stock after
delivery or mailing of the notice of and prior to the holding of the meeting,
it shall not be necessary to deliver or mail notice of the meeting to the
transferee.
If any notice addressed to a stockholder at the address of such
stockholder appearing on the books of the corporation is returned to the
corporation by the United States Postal Service marked to indicate that the
United States Postal Service is unable to deliver the notice to the
stockholder at such address, all future notices or reports shall be deemed to
have been duly given without further mailing if the same shall be available
to the stockholder upon written demand of the stockholder at the principal
executive office of the corporation for a period of one year from the date of
the giving of such notice.
An affidavit of the mailing or other means of giving any notice of
any stockholders' meeting shall be executed by the secretary, assistant
secretary or any transfer agent of the corporation giving such notice, and
shall be filed and maintained in the minute book of the corporation.
Business transacted at any special meeting of stockholders shall be
limited to the purposes stated in the notice.
Section 6. QUORUM. The presence in person or by proxy of the
holders of a majority of the shares entitled to vote at any meeting of
stockholders shall constitute a quorum for the transaction of business,
except as otherwise provided by statute or the articles of incorporation.
The stockholders present at a duly called or held meeting at which a quorum
is present may continue to do business until adjournment, notwithstanding the
withdrawal of enough stockholders to leave less than a quorum, if any action
taken (other than adjournment) is approved by at least a majority of the
shares required to constitute a quorum.
Section 7. ADJOURNED MEETING AND NOTICE THEREOF. Any
stockholders' meeting, annual or special, whether or not a quorum is present,
may be adjourned from time to time by the vote of the majority of the shares
represented at such meeting, either in person or by proxy, but in the absence
of a quorum, no other business may be transacted at such meeting.
When any meeting of stockholders, either annual or special, is
adjourned to another time or place, notice need not be given of the adjourned
meeting if the time and place thereof are announced at a meeting at which the
adjournment is taken. At any adjourned meeting the corporation may transact
any business which might have been transacted at the original meeting.
Section 8. VOTING. Unless a record date set for voting
purposes be fixed as provided in Section 1 of Article VII of these bylaws,
only persons in whose names shares entitled to vote stand on the stock
records of the corporation at the close of business on the business day next
preceding the day on which notice is given (or, if notice is waived, at the
close of business on the business day next preceding the day on which the
meeting is held) shall be entitled to vote at such meeting. Any stockholder
entitled to vote on any matter other than elections of directors or officers,
may vote part of the shares in favor of the proposal and refrain from voting
the remaining shares or vote them against the proposal, but, if the
stockholder fails to specify the number of shares such stockholder is voting
affirmatively, it will be conclusively presumed that the stockholder's
approving vote is with respect to all shares such stockholder is entitled to
vote. Such vote may be by voice vote or by ballot; provided, however, that
all elections for directors must be by ballot upon demand by a stockholder at
any election and before the voting begins.
When a quorum is present or represented at any meeting, the vote of
the holders of a majority of the stock having voting power present in person
or represented by proxy shall decide any question brought before such
meeting, unless the question is one upon which by express provision of the
statutes or of the articles of incorporation a different vote is required in
which case such express provision shall govern and control the decision of
such question. Every stockholder of record of the corporation shall be
entitled at each meeting of stockholders to one vote for each share of stock
standing in his name on the books of the corporation.
Section 9. WAIVER OF NOTICE OR CONSENT BY ABSENT STOCKHOLDERS.
The transactions at any meeting of stockholders, either annual or special,
however called and noticed, and wherever held, shall be as valid as though
had at a meeting duly held after regular call and notice, if a quorum be
present either in person or by proxy, and if, either before or after the
meeting, each person entitled to vote, not present in person or by proxy,
signs a written waiver of notice or a consent to a holding of the meeting, or
an approval of the minutes thereof. The waiver of notice or consent need not
specify either the business to be transacted or the purpose of any regular or
special meeting of stockholders, except that if action is taken or proposed
to be taken for approval of any of those matters specified in the second
paragraph of Section 4 of this Article II, the waiver of notice or consent
shall state the general nature of such proposal. All such waivers, consents
or approvals shall be filed with the corporate records or made a part of the
minutes of the meeting.
Attendance of a person at a meeting shall also constitute a waiver
of notice of such meeting, except when the person objects, at the beginning
of the meeting, to the transaction of any business because the meeting is not
lawfully called or convened, and except that attendance at a meeting is not a
waiver of any right to object to the consideration of matters not included in
the notice if such objection is expressly made at the meeting.
Section 10. STOCKHOLDER ACTION BY WRITTEN CONSENT WITHOUT A
MEETING. Any action which may be taken at any annual or special meeting of
stockholders may be taken without a meeting and without prior notice, if a
consent in writing, setting forth the action so taken, is signed by the
holders of outstanding shares having not less than the minimum number of
votes that would be necessary to authorize or take such action at a meeting
at which all shares entitled to vote thereon were present and voted. All
such consents shall be filed with the secretary of the corporation and shall
be maintained in the corporate records. Any stockholder giving a written
consent, or the stockholder's proxy holders, or a transferee of the shares of
a personal representative of the stockholder of their respective proxy
holders, may revoke the consent by a writing received by the secretary of the
corporation prior to the time that written consents of the number of shares
required to authorize the proposed action have been filed with the secretary.
Section 11. NOTICE OF ACTION TO BE TAKEN BY MAJORITY STOCKHOLDER
CONSENT. A notice of action to be taken by majority stockholder consent
shall be sent or otherwise given in a manner in accordance with Section 5 of
this Article II not less than twenty (20) calendar days prior to the earliest
date on which the corporate action may be taken. The notice shall specify:
(i) the general nature of the corporate action(s) to be taken;(ii) the date
on which the majority stockholder consent was given; (iii) the effects of the
action(s) on the corporation and/or its stockholders; and (iv) any conflicts
of interest that are present with regards to the action(s) to be taken
between the corporation's officers, directors and/or their affiliates.
A shareholder who does not sign or consent to the written action
has no liability for the action or actions taken by the written actions.
Section 12. PROXIES. Every person entitled to vote for
directors or on any other matter shall have the right to do so either in
person or by one or more agents authorized by a written proxy signed by the
person and filed with the secretary of the corporation. A proxy shall be
deemed signed if the stockholder's name is placed on the proxy (whether by
manual signature, typewriting, telegraphic transmission or otherwise) by the
stockholder or the stockholder's attorney in fact. A validly executed proxy
which does not state that it is irrevocable shall continue in full force and
effect unless revoked by the person executing it, prior to the vote pursuant
thereto, by a writing delivered to the corporation stating that the proxy is
revoked or by a subsequent proxy executed by, or attendance at the meeting
and voting in person by the person executing the proxy; provided, however,
that no such proxy shall be valid after the expiration of six (6) months from
the date of such proxy, unless coupled with an interest, or unless the person
executing it specifies therein the length of time for which it is to continue
in force, which in no case shall exceed seven (7) years from the date of its
execution. Subject to the above and the provisions of the North Dakota
General Corporation Law, any proxy duly executed is not revoked and continues
in full force and effect until an instrument revoking it or a duly executed
proxy bearing a later date is filed with the secretary of the corporation.
Section 13. INSPECTORS OF ELECTION. Before any meeting of
stockholders, the board of directors may appoint any persons other than
nominees for office to act as inspectors of election at the meeting or its
adjournment. If no inspectors of election are appointed, the chairman of the
meeting may, and on the request of any stockholder or his proxy shall,
appoint inspectors of election at the meeting. The number of inspectors
shall be either one (1) or three (3). If inspectors are appointed at a
meeting on the request of one or more stockholders or proxies, the holders of
a majority of shares or their proxies present at the meeting shall determine
whether one (1) or three (3) inspectors are to be appointed. If any person
appointed as inspector fails to appear or fails or refuses to act, the
vacancy may be filled by appointment by the board of directors before the
meeting, or by the chairman at the meeting.
The duties of these inspectors shall be as follows:
(a) Determine the number of shares outstanding and the voting
power of each, the shares represented at the meeting, the existence of a
quorum, and the authenticity, validity, and effect of proxies;
(b) Receive votes, ballots, or consents;
(c) Hear and determine all challenges and questions in any
way arising in connection with the right to vote;
(d) Count and tabulate all votes or consents;
(e) Determine the election result; and
(f) Do any other acts that may be proper to conduct the
election or vote with fairness to all stockholders.
ARTICLE III
DIRECTORS
Section 1. POWERS. Subject to the provisions of the North
Dakota General Corporation Law and any limitations in the articles of
incorporation and these bylaws relating to action required to be approved by
the stockholders or by the outstanding shares, the business and affairs of
the corporation shall be managed and all corporate powers shall be exercised
by or under the direction of the board of directors.
Without prejudice to such general powers, but subject to the same
limitations, it is hereby expressly declared that the directors shall have
the power and authority to:
(a) Select and remove all officers, agents, and employees of
the corporation, prescribe such powers and duties for them as may not be
inconsistent with law, with the articles of incorporation or these bylaws,
fix their compensation, and require from them security for faithful service.
(b) Change the principal executive office or the principal
business office from one location to another; cause the corporation to be
qualified to do business in any other state, territory, dependency, or
foreign country and conduct business within or without the State; designate
any place within or without the State for the holding of any stockholders'
meeting, or meetings, including annual meetings; adopt, make and use a
corporate seal, and prescribe the forms of certificates of stock, and alter
the form of such seal and of such certificates from time to time as in their
judgment they may deem best, provided that such forms shall at all times
comply with the provisions of law.
(c) Authorize the issuance of shares of stock of the
corporation from time to time, upon such terms as may be lawful, in
consideration of money paid, labor done or services actually rendered, debts
or securities cancelled, tangible or intangible property actually received.
(d) Borrow money and incur indebtedness for the purpose of
the corporation, and cause to be executed and delivered therefor, in the
corporate name, promissory notes, bonds, debentures, deeds of trust,
mortgages, pledges, hypothecations, or other evidences of debt and securities
therefor.
Section 2. NUMBER OF DIRECTORS. The authorized number of
directors shall be no fewer than one (1) nor more than seven (7). The exact
number of authorized directors shall be set by resolution of the board of
directors, within the limits specified above. The maximum or minimum number
of directors cannot be changed, nor can a fixed number be substituted for the
maximum and minimum numbers, except by a duly adopted amendment to this bylaw
duly approved by a majority of the outstanding shares entitled to vote.
Section 3. QUALIFICATION, ELECTION AND TERM OF OFFICE OF
DIRECTORS. Directors shall be elected at each annual meeting of the
stockholders to hold office until the next annual meeting, but if any such
annual meeting is not held or the directors are not elected at any annual
meeting, the directors may be elected at any special meeting of stockholders
held for that purpose, or at the next annual meeting of stockholders held
thereafter. Each director, including a director elected to fill a vacancy,
shall hold office until the expiration of the term for which elected and
until a successor has been elected and qualified or until his earlier
resignation or removal or his office has been declared vacant in the manner
provided in these bylaws. Directors need not be stockholders.
Section 4. RESIGNATION AND REMOVAL OF DIRECTORS. Any director
may resign effective upon giving written notice to the chairman of the board,
the president, the secretary or the board of directors of the corporation,
unless the notice specifies a later time for the effectiveness of such
resignation, in which case such resignation shall be effective at the time
specified. Unless such resignation specifies otherwise, its acceptance by
the corporation shall not be necessary to make it effective. The board of
directors may declare vacant the office of a director who has been declared
of unsound mind by an order of a court or convicted of a felony. Any or all
of the directors may be removed without cause of such removal is approved by
the affirmative vote of a majority of the outstanding shares entitled to
vote. No reduction of the authorized number of directors shall have the
effect of removing any director before his term of office expires.
Section 5. VACANCIES. Vacancies in the board of directors, may
be filled by a majority of the remaining directors, though less than a
quorum, or by a sole remaining director. Each director so elected shall hold
office until the next annual meeting of the stockholders and until a
successor has been elected and qualified.
A vacancy in the board of directors exists as to any authorized
position of directors which is not then filled by a duly elected director,
whether caused by death, resignation, removal, increase in the authorized
number of directors or otherwise.
The stockholders may elect a director or directors at any time to
fill any vacancy or vacancies not filled by the directors, but any such
election by written consent shall require the consent of a majority of the
outstanding shares entitled to vote. If the resignation of a director is
effective at a future time, the board of directors may elect a successor to
take office when the resignation becomes effective.
If after the filling of any vacancy by the directors, the directors
then in office who have been elected by the stockholders shall constitute
less than a majority of the directors then in office, any holder or holders
of an aggregate of five percent or more of the total number of shares at the
time outstanding having the right to vote for such directors may call a
special meeting of the stockholders to elect the entire board. The term of
office of any director not elected by the stockholders shall terminate upon
the election of a successor.
Section 6. PLACE OF MEETINGS. Regular meetings of the board of
directors shall be held at any place within or without the State of North
Dakota that has been designated from time to time by resolution of the board.
In the absence of such designation, regular meetings shall be held at the
principal executive office of the corporation. Special meetings of the board
shall be held at any place within or without the State of North Dakota that
has been designated in the notice of the meeting or, if not stated in the
notice or there is not notice, at the principal executive office of the
corporation. Any meeting, regular or special, may be held by conference
telephone or similar communication equipment, so long as all directors
participating in such meeting can hear one another, and all such directors
shall be deemed to be present in person at such meeting.
Section 7. ANNUAL MEETINGS. Immediately following each annual
meeting of stockholders, the board of directors shall hold a regular meeting
for the purpose of transaction of other business. Notice of this meeting
shall not be required.
Section 8. OTHER REGULAR MEETINGS. Other regular meetings of
the board of directors shall be held without call at such time as shall from
time to time be fixed by the board of directors. Such regular meetings may
be held without notice, provided the notice of any change in the time of any
such meetings shall be given to all of the directors. Notice of a change in
the determination of the time shall be given to each director in the same
manner as notice for special meetings of the board of directors.
Section 9. SPECIAL MEETINGS. Special meetings of the board of
directors for any purpose or purposes may be called at any time by the
chairman of the board or the president or any vice president or the secretary
or any two directors.
Notice of the time and place of special meetings shall be delivered
personally or by telephone to each director or sent by first-class mail or
telegram, charges prepaid, addressed to each director at his or her address
as it is shown upon the records of the corporation. In case such notice is
mailed, it shall be deposited in the United States mail at least four (4)
days prior to the time of the holding of the meeting. In case such notice is
delivered personally, or by telephone or telegram, it shall be delivered
personally or by telephone or to the telegraph company at least forty-eight
(48) hours prior to the time of the holding of the meeting. Any oral notice
given personally or by telephone may be communicated to either the director
or to a person at the office of the director who the person giving the notice
has reason to believe will promptly communicate it to the director. The
notice need not specify the purpose of the meeting nor the place if the
meeting is to be held at the principal executive office of the corporation.
Section 10. QUORUM. A majority of the authorized number of
directors shall constitute a quorum for the transaction of business, except
to adjourn as hereinafter provided. Every act or decision done or made by a
majority of the directors present at a meeting duly held at which a quorum is
present shall be regarded as the act of the board of directors, subject to
the provisions of the North Dakota General Corporation Law. A meeting at
which a quorum is initially present may continue to transact business
notwithstanding the withdrawal of directors, if any action taken is approved
by at least a majority of the required quorum for such meeting.
Section 11. WAIVER OF NOTICE. The transactions of any meeting
of the board of directors, however called and noticed or wherever held, shall
be as valid as though had at a meeting duly held after regular call and
notice if a quorum be present and if, either before or after the meeting,
each of the directors not present signs a written waiver of notice, a consent
to holding the meeting or an approval of the minutes thereof. The waiver of
notice of consent need not specify the purpose of the meeting. All such
waivers, consents and approvals shall be filed with the corporate records or
made a part of the minutes of the meeting. Notice of a meeting shall also be
deemed given to any director who attends the meeting without protesting,
prior thereto or at its commencement, the lack of notice to such director.
Section 12. ADJOURNMENT. A majority of the directors present,
whether or not constituting a quorum, may adjourn any meeting to another time
and place.
Section 13. NOTICE OF ADJOURNMENT. Notice of the time and place
of holding an adjourned meeting need not be given, unless the meeting is
adjourned for more than twenty-four (24) hours, in which case notice of such
time and place shall be given prior to the time of the adjourned meeting, in
the manner specified in Section 8 of this Article III, to the directors who
were not present at the time of the adjournment.
Section 14. ACTION WITHOUT MEETING. Any action required or
permitted to be taken by the board of directors may be taken without a
meeting, if all members of the board shall individually or collectively
consent in writing to such action. Such action by written consent shall have
the same force and effect as a unanimous vote of the board of directors.
Such written consent or consents shall be filed with the minutes of the
proceedings of the board.
Section 15. FEES AND COMPENSATION OF DIRECTORS. Directors and
members of committees may receive such compensation, if any, for their
services, and such reimbursement of expenses, as may be fixed or determined
by resolution of the board of directors. Nothing herein contained shall be
construed to preclude any director from serving the corporation in any other
capacity as an officer, agent, employee, or otherwise, and receiving
compensation for such services. Members of special or standing committees
may be allowed like compensation for attending committee meetings.
ARTICLE IV
COMMITTEES
Section 1. COMMITTEES OF DIRECTORS. The board of directors
may, by resolution adopted by a majority of the authorized number of
directors, designate one or more committees, each consisting of one or more
directors, to serve at the pleasure of the board. The board may designate
one or more directors as alternate members of any committees, who may replace
any absent member at any meeting of the committee. Any such committee, to
the extent provided in the resolution of the board, shall have all the
authority of the board, except with regard to:
(a) the approval of any action which, under the North Dakota
General Corporation Law, also requires stockholders' approval or approval of
the outstanding shares;
(b) the filing of vacancies on the board of directors or in
any committees;
(c) the fixing of compensation of the directors for serving
on the board or on any committee;
(d) the amendment or repeal of bylaws or the adoption of new
bylaws;
(e) the amendment or repeal of any resolution of the board of
directors which by its express terms is not so amendable or repealable;
(f) a distribution to the stockholders of the corporation,
except at a rate or in a periodic amount or within a price range determined
by the board of directors; or
(g) the appointment of any other committees of the board of
directors or the members thereof.
Section 2. MEETINGS AND ACTION BY COMMITTEES. Meetings and
action of committees shall be governed by, and held and taken in accordance
with, the provisions of Article III, Sections 6 (place of meetings), 8
(regular meetings), 9 (special meetings and notice), 10 (quorum), 11 (waiver
of notice), 12 (adjournment), 13 (notice of adjournment) and 14 (action
without meeting), with such changes in the context of those bylaws as are
necessary to substitute the committee and its members for the board of
directors and its members, except that the time or regular meetings of
committees may be determined by resolutions of the board of directors and
notice of special meetings of committees shall also be given to all alternate
members, who shall have the right to attend all meetings of the committee.
The board of directors may adopt rules for the government of any committee
not inconsistent with the provisions of these bylaws. The committees shall
keep regular minutes of their proceedings and report the same to the board
when required.
ARTICLE V
OFFICERS
Section 1. OFFICERS. The officers of the corporation shall be
a chief executive officer, president, a secretary and a treasurer. The
corporation may also have, at the discretion of the board of directors, a
chairman of the board, one or more vice presidents, one or more assistant
secretaries, one or more assistant treasurers, and such other officers as may
be appointed in accordance with the provisions of Section 3 of this
Article V. Any two or more offices may be held by the same person.
Section 2. ELECTION OF OFFICERS. The officers of the
corporation, except such officers as may be appointed in accordance with the
provisions of Section 3 or Section 5 of this Article V, shall be chosen by
the board of directors, and each shall serve at the pleasure of the board,
subject to the rights, if any, of an officer under any contract of
employment. The board of directors at its first meeting after each annual
meeting of stockholders shall choose a chief executive officer, president, a
secretary and a treasurer, none of whom need be a member of the board. The
salaries of all officers and agents of the corporation shall be fixed by the
board of directors.
Section 3. SUBORDINATE OFFICERS, ETC. The board of directors
may appoint, and may empower the chief executive officer or the president to
appoint, such other officers as the business of the corporation may require,
each of whom shall hold office for such period, have such authority and
perform such duties as are provided in the bylaws or as the board of
directors may from time to time determine.
Section 4. REMOVAL AND RESIGNATION OF OFFICERS. The officers
of the corporation shall hold office until their successors are chosen and
qualify. Subject to the rights, if any, of an officer under any contract of
employment, any officer may be removed, either with or without cause, by the
board of directors, at any regular or special meeting thereof, or, except in
case of an officer chosen by the board of directors, by any officer upon whom
such power or removal may be conferred by the board of directors.
Any officer may resign at any time by giving written notice to the
corporation. Any such resignation shall take effect at the date of the
receipt of such notice or at any later time specified therein; and, unless
otherwise specified therein, the acceptance of such resignation shall not be
necessary to make it effective. Any such resignation is without prejudice to
the rights, if any, of the corporation under any contract to which the
officer is a party.
Section 5. VACANCIES IN OFFICES. A vacancy in any office
because of death, resignation, removal, disqualification or any other cause
shall be filled in the manner prescribed in these bylaws for regular
appointments to such office.
Section 6. CHIEF EXECUTIVE OFFICER. The chief executive
officer shall be the principal executive officer of the corporation and,
subject to the control of the board of directors, shall, in general, have the
following powers and duties:
a. He shall, subject to the direction of the board of directors,
have general charge of the business, affairs and property of the
corporation and general supervision over the officers, employees and
agents.
b. If no chairman of the board has been chosen, or if such
officer is absent or disabled, he shall preside at meetings of the
stockholders and board of directors.
c. He shall be a member of any Executive Committee.
d. He shall, except where by law the signature of the president
is required or unless the board of directors shall rule otherwise, be
empowered to sign or countersign with the secretary, an assistant
secretary, or any other proper officer of the corporation thereunto
authorized by the board of directors all certificates representing stock
of the corporation, any deeds, mortgages, bonds, contracts, or other
instruments of the corporation as authorized by the board of directors.
e. He shall at all times maintain the power to expressly monitor,
delegate and control the duties and actions of the president of the
corporation.
f. He shall make reports to the board of directors and
shareholders.
g. He shall perform such other duties as are incident to the
office of chief executive officer and such other duties as may be
prescribed or are properly required of him by the board of directors
from time to time.
Section 7. PRESIDENT. The president shall be the chief
operating officer of the corporation and, subject to the control of board of
directors and supervision of the chief executive officer, shall, in general,
supervise and control all of the business and affairs of the corporation. He
shall in the absence of the chief executive officer, when present, preside at
all meetings of the shareholders. He shall sign, with the secretary, an
assistant secretary, or any other proper officer of the corporation thereunto
authorized by the board of directors, certificates for shares of the
corporation, any deeds, mortgages, bonds, contracts, or other instruments
which the board of directors has authorized to be executed, except in cases
where the signing and execution thereof shall be expressly delegated by the
board of directors or by these bylaws to some other officer or agent of the
corporation, or shall be required by law to be otherwise signed or executed;
and, in general, shall perform all duties incident to the office of president
chief operating officer and such other duties as may be prescribed by the
board of directors from time to time.
Section 8. VICE PRESIDENTS. In the absence or disability of
the president, the vice presidents, if any, in order of their rank as fixed
by the board of directors or, if not ranked, a vice president designated by
the board of directors, shall perform all the duties of the president, and
when so acting shall have all the powers of, and be subject to all the
restrictions upon, the president. The vice presidents shall have such other
powers and perform such other duties as from time to time may be prescribed
for them respectively by the board of directors or the bylaws, the president
or the chairman of the board.
Section 9. SECRETARY. The secretary shall attend all meetings
of the board of directors and all meetings of the stockholders and shall
record, keep or cause to be kept, at the principal executive office or such
other place as the board of directors may order, a book of minutes of all
meetings of directors, committees of directors and stockholders, with the
time and place of holding, whether regular or special, and, if special, how
authorized, the notice thereof given, the names of those present at
directors' and committee meetings, the number of shares present or
represented at stockholders' meetings, and the proceedings thereof.
The secretary shall keep, or cause to be kept, at the principal
executive office or at the office of the corporation's transfer agent or
registrar, as determined by resolution of the board of directors, a share
register, or a duplicate share register, showing the names of all
stockholders and their addresses, the number and classes of shares held by
each, the number and date of certificates issued for the same, and the number
and date of cancellation of every certificate surrendered for cancellation.
The secretary shall give, or cause to be given, notice of all
meetings of stockholders and of the board of directors required by the bylaws
or by law to be given, and he shall keep the seal of the corporation in safe
custody, as may be prescribed by the board of directors or by the bylaws.
Section 10. TREASURER. The treasurer shall keep and maintain,
or cause to be kept and maintained, adequate and correct books and records of
accounts of the properties and business transactions of the corporation,
including accounts of its assets, liabilities, receipts, disbursements,
gains, losses, capital, retained earnings and shares. The books of account
shall at all reasonable times be open to inspection by any director.
The treasurer shall deposit all moneys and other valuables in the
name and to the credit of the corporation with such depositaries as may be
designated by the board of directors. He shall disburse the funds of the
corporation as may be ordered by the board of directors, shall render to the
president and directors, whenever they request it, an account of all of his
transactions as treasurer and of the financial condition of the corporation,
and shall have other powers and perform such other duties as may be
prescribed by the board of directors or the bylaws.
If required by the board of directors, the treasurer shall give the
corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the board of directors for the faithful performance of the
duties of his office and for the restoration to the corporation, in case of
his death, resignation, retirement or removal from office, of all books,
papers, vouchers, money and other property of whatever kind in his possession
or under his control belonging to the corporation.
ARTICLE VI
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES,
AND OTHER AGENTS
Section 1. ACTIONS OTHER THAN BY THE CORPORATION. The
corporation may indemnify any person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, except
an action by or in the right of the corporation, by reason of the fact that
he is or was a director, officer, employee or agent of the corporation, or is
or was 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 expenses, including attorneys' fees, judgments,
fines and amounts paid in settlement actually and reasonably incurred by him
in connection with the action, suit or proceeding if he acted in good faith
and in a manner which he reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any criminal action
or proceeding, has no reasonable cause to believe his conduct was unlawful.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
does not, of itself, create a presumption that the person did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the corporation, and that, with respect to any criminal
action or proceeding, he had reasonable cause to believe that his conduct was
unlawful.
Section 2. ACTIONS BY THE CORPORATION. The corporation may
indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by reason of the
fact that he is or was a director, officer, employee or agent of the
corporation, or is or was 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 expenses, including amounts
paid in settlement and attorneys' fees, actually and reasonably incurred by
him in connection with the defense or settlement of the action or suit if he
acted in good faith and in a manner which he reasonably believed to be in or
not opposed to the best interests of the corporation. Indemnification may
not be made for any claim, issue or matter as to which such a person has been
adjudged by a court of competent jurisdiction, after exhaustion of all
appeals therefrom, to be liable to the corporation or for amounts paid in
settlement to the corporation, unless and only to the extent that the court
in which the action or suit was brought or other court of competent
jurisdiction determines upon application that in view of all the
circumstances of the case, the person is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper.
Section 3. SUCCESSFUL DEFENSE. To the extent that a director,
officer, employee or agent of the corporation has been successful on the
merits or otherwise in defense of any action, suit or proceeding referred to
in Sections 1 and 2, or in defense of any claim, issue or matter therein, he
must be indemnified by the corporation against expenses, including attorneys'
fees, actually and reasonably incurred by him in connection with the defense.
Section 4. REQUIRED APPROVAL. Any indemnification under
Sections 1 and 2, unless ordered by a court or advanced pursuant to Section
5, must be made by the corporation only as authorized in the specific case
upon a determination that indemnification of the director, officer, employee
or agent is proper in the circumstances. The determination must be made:
(a) By the stockholders;
(b) By the board of directors by majority vote of a quorum
consisting of directors who were not parties to the act, suit or proceeding;
(c) If a majority vote of a quorum consisting of directors
who were not parties to the act, suit or proceeding so orders, by independent
legal counsel in a written opinion; or
(d) If a quorum consisting of directors who were not parties
to the act, suit or proceeding cannot be obtained, by independent legal
counsel in a written opinion.
Section 5. ADVANCE OF EXPENSES. The articles of incorporation,
the bylaws or an agreement made by the corporation may provide that the
expenses of officers and directors incurred in defending a civil or criminal
action, suit or proceeding must be paid by the corporation as they are
incurred and in advance of the final disposition of the action, suit or
proceeding upon receipt of an undertaking by or on behalf of the director or
officer to repay the amount if it is ultimately determined by a court of
competent jurisdiction that he is not entitled to be indemnified by the
corporation. The provisions of this section do not affect any rights to
advancement of expenses to which corporate personnel other than directors or
officers may be entitled under any contract or otherwise by law.
Section 6. OTHER RIGHTS. The indemnification and advancement
of expenses authorized in or ordered by a court pursuant to this Article VI:
(a) Does not exclude any other rights to which a person
seeking indemnification or advancement of expenses may be entitled under the
articles of incorporation or any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, for either an action in his official
capacity or an action in another capacity while holding his office, except
that indemnification, unless ordered by a court pursuant to Section 2 or for
the advancement of expenses made pursuant to Section 5, may not be made to or
on behalf of any director or officer if a final adjudication establishes that
his acts or omissions involved intentional misconduct, fraud or a knowing
violation of the law and was material to the cause of action.
(b) Continues for a person who has ceased to be a director,
officer, employee or agent and inures to the benefit of the heirs, executors
and administrators of such a person.
Section 7. INSURANCE. The corporation may purchase and
maintain insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of
the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise for any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the corporation would have
the power to indemnify him against such liability under the provisions of
this Article VI.
Section 8. RELIANCE ON PROVISIONS. Each person who shall act
as an authorized representative of the corporation shall be deemed to be
doing so in reliance upon the rights of indemnification provided by this
Article.
Section 9. SEVERABILITY. If any of the provisions of this
Article are held to be invalid or unenforceable, this Article shall be
construed as if it did not contain such invalid or unenforceable provision
and the remaining provisions of this Article shall remain in full force and
effect.
Section 10. RETROACTIVE EFFECT. To the extent permitted by
applicable law, the rights and powers granted pursuant to this Article VI
shall apply to acts and actions occurring or in progress prior to its
adoption by the board of directors.
ARTICLE VII
RECORDS AND BOOKS
Section 1. MAINTENANCE OF SHARE REGISTER. The corporation
shall keep at its principal executive office, or at the office of its
transfer agent or registrar, if either be appointed and as determined by
resolution of the board of directors, a record of its stockholders, giving
the names and addresses of all stockholders and the number and class of
shares held by each stockholder.
Section 2. MAINTENANCE OF BYLAWS. The corporation shall keep
at its principal executive office, or if its principal executive office is
not in this State at its principal business office in this State, the
original or a copy of the bylaws as amended to date, which shall be open to
inspection by the stockholders at all reasonable times during office hours.
If the principal executive office of the corporation is outside this state
and the corporation has no principal business office in this state, the
secretary shall, upon the written request of any stockholder, furnish to such
stockholder a copy of the bylaws as amended to date.
Section 3. MAINTENANCE OF OTHER CORPORATE RECORDS. The
accounting books and records and minutes of proceedings of the stockholders
and the board of directors and any committee or committees of the board of
directors shall be kept at such place or places designated by the board of
directors, or, in the absence of such designation, at the principal executive
office of the corporation. The minutes shall be kept in written form and the
accounting books and records shall be kept either in written form or in any
other form capable of being converted into written form.
Every director shall have the absolute right at any reasonable time
to inspect and copy all books, records and documents of every kind and to
inspect the physical properties of this corporation and any subsidiary of
this corporation. Such inspection by a director may be made in person or by
agent or attorney and the right of inspection includes the right to copy and
make extracts. The foregoing rights of inspection shall extend to the
records of each subsidiary of the corporation.
Section 4. ANNUAL REPORT TO STOCKHOLDERS. Nothing herein shall
be interpreted as prohibiting the board of directors from issuing annual or
other periodic reports to the stockholders of the corporation as they deem
appropriate.
Section 5. FINANCIAL STATEMENTS. A copy of any annual
financial statement and any income statement of the corporation for each
quarterly period of each fiscal year, and any accompanying balance sheet of
the corporation as of the end of each such period, that has been prepared by
the corporation shall be kept on file in the principal executive office of
the corporation for twelve (12) months.
Section 6. ANNUAL LIST OF DIRECTORS, OFFICERS AND RESIDENT
AGENT. The corporation shall, each year, file with the Secretary of State of
the State of North Dakota, on the prescribed form, a list of its officers and
directors and a designation of its resident agent in North Dakota.
ARTICLE VIII
GENERAL CORPORATE MATTERS
Section 1. RECORD DATE. For purposes of determining the
stockholders entitled to notice of any meeting or to vote or entitled to
receive payment of any dividend or other distribution or allotment of any
rights or entitled to exercise any rights in respect of any other lawful
action, the board of directors may fix, in advance, a record date, which
shall not be more than sixty (60) days nor less than ten (10) days prior to
the date of any such meeting nor more than sixty (60) days prior to any other
action, and in such case only stockholders of record on the date so fixed are
entitled to notice and to vote or to receive the dividend, distribution or
allotment of rights or to exercise the rights, as the case may be,
notwithstanding any transfer of any shares on the books of the corporation
after the record date fixed as aforesaid, except as otherwise provided in the
North Dakota General Corporation Law.
If the board of directors does not so fix a record date:
(a) The record date for determining stockholders entitled to
notice of or to vote at a meeting of stockholders shall be at the close of
business on the day next preceding the day on which notice is given or, if
notice is waived, at the close of business on the business day next preceding
the day on which the meeting is held.
(b) The record date for determining stockholders entitled to
give consent to corporate action in writing without a meeting, when no prior
action by the board has been taken, shall be the day on which the first
written consent is given.
(c) The record date for determining stockholders for any
other purpose shall be at the close of business on the day on which the board
adopts the resolution relating thereto, or the sixtieth (60th) day prior to
the date of such other action, whichever is later.
Section 2. CLOSING OF TRANSFER BOOKS. The directors may
prescribe a period not exceeding sixty (60) days prior to any meeting of the
stockholders during which no transfer of stock on the books of the
corporation may be made, or may fix a date not more than sixty (60) days
prior to the holding of any such meeting as the day as of which stockholders
entitled to notice of and to vote at such meeting shall be determined; and
only stockholders of record on such day shall be entitled to notice or to
vote at such meeting.
Section 3. REGISTERED STOCKHOLDERS. The corporation shall be
entitled to recognize the exclusive right of a person registered on its books
as the owner of shares to receive dividends, and to vote as such owner, and
to hold liable for calls and assessments a person registered on its books as
the owner of shares, and shall not be bound to recognize any equitable or
other claim to or interest in such share or shares on the part of any other
person, whether or not it shall have express or other notice thereof, except
as otherwise provided by the laws of North Dakota.
Section 4. CHECKS, DRAFTS, EVIDENCES OF INDEBTEDNESS. All
checks, drafts or other orders for payment of money, notes or other evidences
of indebtedness, issued in the name of or payable to the corporation, shall
be signed or endorsed by such person or persons and in such manner as, from
time to time, shall be determined by resolution of the board of directors.
Section 5. CORPORATE CONTRACTS AND INSTRUMENTS; HOW EXECUTED.
The board of directors, except as in the bylaws otherwise provided, may
authorize any officer or officers, agent or agents, to enter into any
contract or execute any instrument in the name of and on behalf of the
corporation, and such authority may be general or confined to specific
instances; and, unless so authorized or ratified by the board of directors or
within the agency power or authority to bind the corporation by any contract
or engagement or to pledge its credit or to render it liable for any purpose
or to any amount.
Section 6. STOCK CERTIFICATES. A certificate or certificates
for shares of the capital stock of the corporation shall be issued to each
stockholder when any such shares are fully paid, and the board of directors
may authorize the issuance of certificates or shares as partly paid provided
that such certificates shall state the amount of the consideration to be paid
therefor and the amount paid thereon. All certificates shall be signed in
the name of the corporation by the chief executive officer or president or
vice president and by the treasurer or an assistant treasurer or the
secretary or any assistant secretary, certifying the number of shares and the
class or series of shares owned by the stockholder. When the corporation is
authorized to issue shares of more than one class or more than one series of
any class, there shall be set forth upon the face or back of the certificate,
or the certificate shall have a statement that the corporation will furnish
to any stockholders upon request and without charge, a full or summary
statement of the designations, preferences and relatives, participating,
optional or other special rights of the various classes of stock or series
thereof and the qualifications, limitations or restrictions of such rights,
and, if the corporation shall be authorized to issue only special stock, such
certificate must set forth in full or summarize the rights of the holders of
such stock. Any or all of the signatures on the certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed
or whose facsimile signature has been placed upon a certificate shall have
ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the corporation with the same
effect as if such person were an officer, transfer agent or registrar at the
date of issue.
No new certificate for shares shall be issued in place of any
certificate theretofore issued unless the latter is surrendered and cancelled
at the same time; provided, however, that a new certificate may be issued
without the surrender and cancellation of the old certificate if the
certificate thereto fore issued is alleged to have been lost, stolen or
destroyed. In case of any such allegedly lost, stolen or destroyed
certificate, the corporation may require the owner thereof or the legal
representative of such owner to give the corporation a bond (or other
adequate security) sufficient to indemnify it against any claim that may be
made against it (including any expense or liability) on account of the
alleged loss, theft or destruction of any such certificate or the issuance of
such new certificate.
Section 7. DIVIDENDS. Dividends upon the capital stock of the
corporation, subject to the provisions of the articles of incorporation, if
any, may be declared by the board of directors at any regular or special
meeting pursuant to law. Dividends may be paid in cash, in property, or in
shares of the capital stock, subject to the provisions of the articles of
incorporation.
Before payment of any dividend, there may be set aside out of any
funds of the corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve or reserves to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the corporation, or for such
other purpose as the directors shall think conducive to the interest of the
corporation, and the directors may modify or abolish any such reserves in the
manner in which it was created.
Section 8. FISCAL YEAR. The fiscal year of the corporation
shall be December 31st.
Section 9. SEAL. The corporate seal shall have inscribed
thereon the name of the corporation, the year of its incorporation and the
words "Corporate Seal, North Dakota."
Section 10. REPRESENTATION OF SHARES OF OTHER CORPORATIONS. The
chairman of the board, the president, or any vice president, or any other
person authorized by resolution of the board of directors by any of the
foregoing designated officers, is authorized to vote on behalf of the
corporation any and all shares of any other corporation or corporations,
foreign or domestic, standing in the name of the corporation. The authority
herein granted to said officers to vote or represent on behalf of the
corporation any and all shares held by the corporation in any other
corporation or corporations may be exercised by any such officer in person or
by any person authorized to do so by proxy duly executed by said officer.
Section 11. CONSTRUCTION AND DEFINITIONS. Unless the context
requires otherwise, the general provisions, rules of construction, and
definitions in the North Dakota General Corporation Law shall govern the
construction of the bylaws. Without limiting the generality of the
foregoing, the singular number includes the plural, the plural number
includes the singular, and the term "person" includes both a corporation and
a natural person.
ARTICLE IX
AMENDMENTS
Section 1. AMENDMENT BY STOCKHOLDERS. New bylaws may be
adopted or these bylaws may be amended or repealed by the affirmative vote of
a majority of the outstanding shares entitled to vote, or by the written
assent of stockholders entitled to vote such shares, except as otherwise
provided by law or by the articles of incorporation.
Section 2. AMENDMENT BY DIRECTORS. Subject to the rights of
the stockholders as provided in Section 1 of this Article, bylaws may be
adopted, amended or repealed by the board of directors.
CERTIFICATE OF SECRETARY
I, the undersigned, do hereby certify:
1. That I am the duly elected and acting secretary of DAKOTA
IMAGING, INC. (TO BE KNOWN AS VOYAGER ENTERTAINMENT INTERNATIONAL, INC.)
HOLDINGS LTD., a North Dakota corporation; and
2. That the foregoing Bylaws, comprising twenty-three (23) pages,
constitute the Bylaws of said corporation as duly adopted and approved by the
board of directors of said corporation by a Unanimous Written Consent dated
as of __________, 2002 and duly adopted and approved by the stockholders of
said corporation at a special meeting held on ________, 2002.
IN WITNESS WHEREOF, I have hereunto subscribed my name and affixed
the seal of said corporation this ____ day of __________, 2002.
______________________________
RICHARD HANNIGAN, Secretary
EXHIBIT C
2002 STOCK OPTION PLAN
1. PURPOSE. The purpose of the VOYAGER ENTERTAINMENT INTERNATIONAL,
INC. 2002 Stock Option Plan (the "Plan") is to strengthen VOYAGER
ENTERTAINMENT INTERNATIONAL, INC. a North Dakota corporation ("Corporation"),
by providing to employees, officers, directors, consultants and independent
contractors of the Corporation or any of its subsidiaries (including dealers,
distributors, and other business entities or persons providing services on
behalf of the Corporation or any of its subsidiaries) added incentive for
high levels of performance and unusual efforts to increase the earnings of
the Corporation. The Plan seeks to accomplish this purpose by enabling
specified persons to purchase shares of the common stock of the Corporation,
$.001 par value, thereby increasing their proprietary interest in the
Corporation's success and encouraging them to remain in the employ or service
of the Corporation.
2. CERTAIN DEFINITIONS. As used in this Plan, the following words and
phrases shall have the respective meanings set forth below, unless the
context clearly indicates a contrary meaning:
2.1 "Board of Directors": The Board of Directors of the
Corporation.
2.2 "Committee": The Committee which shall administer the Plan
shall consist of the entire Board of Directors.
2.3 "Fair Market Value Per Share": The fair market value per
share of the Shares as determined by the Committee in good faith. The
Committee is authorized to make its determination as to the fair market value
per share of the Shares on the following basis: (i) if the Shares are traded
only otherwise than on a securities exchange and are not quoted on the
National Association of Securities Dealers' Automated Quotation System
("NASDAQ"), but are quoted on the bulletin board or in the "pink sheets"
published by the National Daily Quotation Bureau, the greater of (a) the
average of the mean between the average daily bid and average daily asked
prices of the Shares during the thirty (30) day period preceding the date of
grant of an Option, as quoted on the bulletin board or in the "pink sheets"
published by the National Daily Quotation Bureau, or (b) the mean between the
average daily bid and average daily asked prices of the Shares on the date of
grant, as published on the bulletin board or in such "pink sheets;" (ii) if
the Shares are traded only otherwise than on a securities exchange and are
quoted on NASDAQ, the greater of (a) the average of the mean between the
closing bid and closing asked prices of the Shares during the thirty (30) day
period preceding the date of grant of an Option, as reported by the Wall
Street Journal and (b) the mean between the closing bid and closing asked
prices of the Shares on the date of grant of an Option, as reported by the
Wall Street Journal; (iii) if the Shares are admitted to trading on a
securities exchange, the greater of (a) the average of the daily closing
prices of the Shares during the ten (10) trading days preceding the date of
grant of an Option, as quoted in the Wall Street Journal, or (b) the daily
closing price of the Shares on the date of grant of an Option, as quoted in
the Wall Street Journal; or (iv) if the Shares are traded only otherwise than
as described in (i), (ii) or (iii) above, or if the Shares are not publicly
traded, the value determined by the Committee in good faith based upon the
fair market value as determined by completely independent and well qualified
experts.
2.4 "Option": A stock option granted under the Plan.
2.5 "Incentive Stock Option": An Option intended to qualify for
treatment as an incentive stock option under Code Sections 421 and 422A, and
designated as an Incentive Stock Option.
2.6 "Nonqualified Option": An Option not qualifying as an
Incentive Stock Option.
2.7 "Optionee": The holder of an Option.
2.8 "Option Agreement": The document setting forth the terms and
conditions of each Option.
2.9 "Shares": The shares of common stock $.001 par value of the
Corporation.
2.10 "Code": The Internal Revenue Code of 1986, as amended.
2.11 "Subsidiary": Any corporation of which fifty percent (50%) or
more of total combined voting power of all classes of stock of such
corporation is owned by the Corporation or another Subsidiary (as so
defined).
3. ADMINISTRATION OF PLAN.
3.1 In General. This Plan shall be administered by the Committee.
Any action of the Committee with respect to administration of the Plan shall
be taken pursuant to (i) a majority vote at a meeting of the Committee (to be
documented by minutes), or (ii) the unanimous written consent of its members.
3.2 Authority. Subject to the express provisions of this Plan,
the Committee shall have the authority to: (i) construe and interpret the
Plan, decide all questions and settle all controversies and disputes which
may arise in connection with the Plan and to define the terms used therein;
(ii) prescribe, amend and rescind rules and regulations relating to
administration of the Plan; (iii) determine the purchase price of the Shares
covered by each Option and the method of payment of such price, individuals
to whom, and the time or times at which, Options shall be granted and
exercisable and the number of Shares covered by each Option; (iv) determine
the terms and provisions of the respective Option Agreements (which need not
be identical); (v) determine the duration and purposes of leaves of absence
which may be granted to participants without constituting a termination of
their employment for purposes of the Plan; and (vi) make all other
determinations necessary or advisable to the administration of the Plan.
Determinations of the Committee on matters referred to in this Section 3
shall be conclusive and binding on all parties howsoever concerned. With
respect to Incentive Stock Options, the Committee shall administer the Plan
in compliance with the provisions of Code Section 422A as the same may
hereafter be amended from time to time. No member of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any Option.
4. ELIGIBILITY AND PARTICIPATION.
4.1 In General. Only officers, employees and directors who are
also employees of the Corporation or any Subsidiary shall be eligible to
receive grants of Incentive Stock Options. Officers, employees and directors
(whether or not they are also employees) of the Corporation or any
Subsidiary, as well as consultants, independent contractors or other service
providers of the Corporation or any Subsidiary shall be eligible to receive
grants of Nonqualified Options. Within the foregoing limits, the Committee,
from time to time, shall determine and designate persons to whom Options may
be granted. All such designations shall be made in the absolute discretion
of the Committee and shall not require the approval of the stockholders. In
determining (i) the number of Shares to be covered by each Option, (ii) the
purchase price for such Shares and the method of payment of such price
(subject to the other sections hereof), (iii) the individuals of the eligible
class to whom Options shall be granted, (iv) the terms and provisions of the
respective Option Agreements, and (v) the times at which such Options shall
be granted, the Committee shall take into account such factors as it shall
deem relevant in connection with accomplishing the purpose of the Plan as set
forth in Section 1. An individual who has been granted an Option may be
granted an additional Option or Options if the Committee shall so determine.
No Option shall be granted under the Plan after April 1, 2012, but Options
granted before such date may be exercisable after such date.
4.2 Certain Limitations. In no event shall Incentive Stock
Options be granted to an Optionee such that the sum of (i) aggregate fair
market value (determined at the time the Incentive Stock Options are granted)
of the Shares subject to all Options granted under the Plan which are
exercisable for the first time during the same calendar year, plus (ii) the
aggregate fair market value (determined at the time the options are granted)
of all stock subject to all other incentive stock options granted to such
Optionee by the Corporation, its parent and Subsidiaries which are
exercisable for the first time during such calendar year, exceeds One Hundred
Thousand Dollars ($100,000). For purposes of the immediately preceding
sentence, fair market value shall be determined as of the date of grant based
on the Fair Market Value Per Share as determined pursuant to Section 2.3.
5. AVAILABLE SHARES AND ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
5.1 Shares. Subject to adjustment as provided in Section 5.2
below, the total number of Shares to be subject to Options granted pursuant
to this Plan shall not exceed five Million (5,000,000) Shares. Shares
subject to the Plan may be either authorized but unissued shares or shares
that were once issued and subsequently reacquired by the Corporation; the
Committee shall be empowered to take any appropriate action required to make
Shares available for Options granted under this Plan. If any Option is
surrendered before exercise or lapses without exercise in full or for any
other reason ceases to be exercisable, the Shares reserved therefore shall
continue to be available under the Plan.
5.2 Adjustments. As used herein, the term "Adjustment Event"
means an event pursuant to which the outstanding Shares of the Corporation
are increased, decreased or changed into, or exchanged for a different number
or kind of shares or securities, without receipt of consideration by the
Corporation, through reorganization, merger, recapitalization,
reclassification, stock split, reverse stock split, stock dividend, stock
consolidation or otherwise. Upon the occurrence of an Adjustment Event,
(i) appropriate and proportionate adjustments shall be made to the number and
kind of shares and exercise price for the shares subject to the Options which
may thereafter be granted under this Plan, (ii) appropriate and proportionate
adjustments shall be made to the number and kind of and exercise price for
the shares subject to the then outstanding Options granted under this Plan,
and (iii) appropriate amendments to the Option Agreements shall be executed
by the Corporation and the Optionees if the Committee determines that such an
amendment is necessary or desirable to reflect such adjustments. If
determined by the Committee to be appropriate, in the event of an Adjustment
Event which involves the substitution of securities of a corporation other
than the Corporation, the Committee shall make arrangements for the
assumptions by such other corporation of any Options then or thereafter
outstanding under the Plan. Notwithstanding the foregoing, such adjustment
in an outstanding Option shall be made without change in the total exercise
price applicable to the unexercised portion of the Option, but with an
appropriate adjustment to the number of shares, kind of shares and exercise
price for each share subject to the Option. The determination by the
Committee as to what adjustments, amendments or arrangements shall be made
pursuant to this Section 5.2, and the extent thereof, shall be final and
conclusive. No fractional Shares shall be issued under the Plan on account
of any such adjustment or arrangement.
6. TERMS AND CONDITIONS OF OPTIONS.
6.1 Intended Treatment as Incentive Stock Options. Incentive
Stock Options granted pursuant to this Plan are intended to be "incentive
stock options" to which Code Sections 421 and 422A apply, and the Plan shall
be construed and administered to implement that intent. If all or any part
of an Incentive Stock Option shall not be an "incentive stock option" subject
to Sections 421 or 422A of the Code, such Option shall nevertheless be valid
and carried into effect. All Options granted under this Plan shall be
subject to the terms and conditions set forth in this Section 6 (except as
provided in Section 5.2) and to such other terms and conditions as the
Committee shall determine to be appropriate to accomplish the purpose of the
Plan as set forth in Section 1.
6.2 Amount and Payment of Exercise Price.
6.2.1 Exercise Price. The exercise price per Share for
each Share which the Optionee is entitled to purchase under a Nonqualified
Option shall be determined by the Committee but shall not be less than One
Hundred percent (100%) of the Fair Market Value Per Share on the date of the
grant of the Nonqualified Option. The exercise price per Share for each
Share which the Optionee is entitled to purchase under an Incentive Stock
Option shall be determined by the Committee but shall not be less than the
Fair Market Value Per Share on the date of the grant of the Incentive Stock
Option; provided, however, that the exercise price shall not be less than one
hundred ten percent (110%) of the Fair Market Value Per Share on the date of
the grant of the Incentive Stock Option in the case of an individual then
owning (within the meaning of Code Section 425(d)) more than ten percent
(10%) of the total combined voting power of all classes of stock of the
Corporation or of its parent or Subsidiaries.
6.2.2 Payment of Exercise Price. The consideration to be
paid for the Shares to be issued upon exercise of an Option, including the
method of payment, shall be determined by the Committee and may consist of
promissory notes, shares of the common stock of the Corporation or such other
consideration and method of payment for the Shares as may be permitted under
applicable state and federal laws.
6.3 Exercise of Options.
6.3.1 Each Option granted under this Plan shall be
exercisable at such times and under such conditions as may be determined by
the Committee at the time of the grant of the Option and as shall be
permissible under the terms of the Plan; provided, however, in no event shall
an Option be exercisable after the expiration of ten (10) years from the date
it is granted, and in the case of an Optionee owning (within the meaning of
Code Section 425(d)), at the time an Incentive Stock Option is granted, more
than ten percent (10%) of the total combined voting power of all classes of
stock of the Corporation or of its parent or Subsidiaries, such Incentive
Stock Option shall not be exercisable later than five (5) years after the
date of grant.
6.3.2 An Optionee may purchase less than the total number
of Shares for which the Option is exercisable, provided that a partial
exercise of an Option may not be for less than One Hundred (100) Shares and
shall not include any fractional shares.
6.4 Nontransferability of Options. All Options granted under this
Plan shall be nontransferable, either voluntarily or by operation of law,
otherwise than by will or the laws of descent and distribution, and shall be
exercisable during the Optionee's lifetime only by such Optionee.
6.5 Effect of Termination of Employment or Other Relationship.
Except as otherwise determined by the Committee in connection with the grant
of Nonqualified Options, the effect of termination of an Optionee's
employment or other relationship with the Corporation on such Optionee's
rights to acquire Shares pursuant to the Plan shall be as follows:
6.5.1 Termination for Other than Disability or Cause. If
an Optionee ceases to be employed by, or ceases to have a relationship with,
the Corporation for any reason other than for disability or cause, such
Optionee's Options shall expire not later than three (3) months thereafter.
During such three (3) month period and prior to the expiration of the Option
by its terms, the Optionee may exercise any Option granted to him, but only
to the extent such Options were exercisable on the date of termination of his
employment or relationship and except as so exercised, such Options shall
expire at the end of such three (3) month period unless such Options by their
terms expire before such date. The decision as to whether a termination for
a reason other than disability, cause or death has occurred shall be made by
the Committee, whose decision shall be final and conclusive, except that
employment shall not be considered terminated in the case of sick leave or
other bona fide leave of absence approved by the Corporation.
6.5.2 Disability. If an Optionee ceases to be employed
by, or ceases to have a relationship with, the Corporation by reason of
disability (within the meaning of Code Section 22(e)(3)), such Optionee's
Options shall expire not later than one (1) year thereafter. During such one
(1) year period and prior to the expiration of the Option by its terms, the
Optionee may exercise any Option granted to him, but only to the extent such
Options were exercisable on the date the Optionee ceased to be employed by,
or ceased to have a relationship with, the Corporation by reason of
disability and except as so exercised, such Options shall expire at the end
of such one (1) year period unless such Options by their terms expire before
such date. The decision as to whether a termination by reason of disability
has occurred shall be made by the Committee, whose decision shall be final
and conclusive.
6.5.3 Termination for Cause. If an Optionee's employment
by, or relationship with, the Corporation is terminated for cause, such
Optionee's Option shall expire immediately; provided, however, the Committee
may, in its sole discretion, within thirty (30) days of such termination,
waive the expiration of the Option by giving written notice of such waiver to
the Optionee at such Optionee's last known address. In the event of such
waiver, the Optionee may exercise the Option only to such extent, for such
time, and upon such terms and conditions as if such Optionee had ceased to be
employed by, or ceased to have a relationship with, the Corporation upon the
date of such termination for a reason other than disability, cause, or death.
Termination for cause shall include termination for malfeasance or gross
misfeasance in the performance of duties or conviction of illegal activity in
connection therewith or any conduct detrimental to the interests of the
Corporation. The determination of the Committee with respect to whether a
termination for cause has occurred shall be final and conclusive.
6.6 Withholding of Taxes. As a condition to the exercise, in
whole or in part, of any Options the Board of Directors may in its sole
discretion require the Optionee to pay, in addition to the purchase price of
the Shares covered by the Option an amount equal to any Federal, state or
local taxes that may be required to be withheld in connection with the
exercise of such Option.
6.7 No Rights to Continued Employment or Relationship.
Nothing contained in this Plan or in any Option Agreement shall obligate the
Corporation to employ or have another relationship with any Optionee for any
period or interfere in any way with the right of the Corporation to reduce
such Optionee's compensation or to terminate the employment of or
relationship with any Optionee at any time.
6.8 Time of Granting Options. The time an Option is granted,
sometimes referred to herein as the date of grant, shall be the day the
Corporation executes the Option Agreement; provided, however, that if
appropriate resolutions of the Committee indicate that an Option is to be
granted as of and on some prior or future date, the time such Option is
granted shall be such prior or future date.
6.9 Privileges of Stock Ownership. No Optionee shall be entitled
to the privileges of stock ownership as to any Shares not actually issued and
delivered to such Optionee. No Shares shall be purchased upon the exercise
of any Option unless and until, in the opinion of the Corporation's counsel,
any then applicable requirements of any laws or governmental or regulatory
agencies having jurisdiction and of any exchanges upon which the stock of the
Corporation may be listed shall have been fully complied with.
6.10 Securities Laws Compliance. The Corporation will diligently
endeavor to comply with all applicable securities laws before any Options are
granted under the Plan and before any Shares are issued pursuant to Options.
Without limiting the generality of the foregoing, the Corporation may require
from the Optionee such investment representation or such agreement, if any,
as counsel for the Corporation may consider necessary or advisable in order
to comply with the Securities Act of 1933 as then in effect, and may require
that the Optionee agree that any sale of the Shares will be made only in such
manner as is permitted by the Committee. The Committee in its discretion may
cause the Shares underlying the Options to be registered under the Securities
Act of 1933, as amended, by the filing of a Form S-8 Registration Statement
covering the Options and Shares underlying such Options. Optionee shall take
any action reasonably requested by the Corporation in connection with
registration or qualification of the Shares under federal or state securities
laws.
6.11 Option Agreement. Each Incentive Stock Option and
Nonqualified Option granted under this Plan shall be evidenced by the
appropriate written Stock Option Agreement ("Option Agreement") executed by
the Corporation and the Optionee in a form substantially the same as the
appropriate form of Option Agreement attached as Exhibit I or II hereto (and
made a part hereof by this reference) and shall contain each of the
provisions and agreements specifically required to be contained therein
pursuant to this Section 6, and such other terms and conditions as are deemed
desirable by the Committee and are not inconsistent with the purpose of the
Plan as set forth in Section 1.
7. PLAN AMENDMENT AND TERMINATION.
7.1 Authority of Committee. The Committee may at any time
discontinue granting Options under the Plan or otherwise suspend, amend or
terminate the Plan and may, with the consent of an Optionee, make such
modification of the terms and conditions of such Optionee's Option as it
shall deem advisable; provided that, except as permitted under the provisions
of Section 5.2, the Committee shall have no authority to make any amendment
or modification to this Plan or any outstanding Option thereunder which
would: (i) increase the maximum number of shares which may be purchased
pursuant to Options granted under the Plan, either in the aggregate or by an
Optionee (except pursuant to Section 5.2); (ii) change the designation of the
class of the employees eligible to receive Incentive Stock Options;
(iii) extend the term of the Plan or the maximum Option period thereunder;
(iv) decrease the minimum Incentive Stock Option price or permit reductions
of the price at which shares may be purchased for Incentive Stock Options
granted under the Plan; or (v) cause Incentive Stock Options issued under the
Plan to fail to meet the requirements of incentive stock options under Code
Section 422A. An amendment or modification made pursuant to the provisions
of this Section 7 shall be deemed adopted as of the date of the action of the
Committee effecting such amendment or modification and shall be effective
immediately, unless otherwise provided therein, subject to approval thereof
(1) within twelve (12) months before or after the effective date by
stockholders of the Corporation holding not less than a majority vote of the
voting power of the Corporation voting in person or by proxy at a duly held
stockholders meeting when required to maintain or satisfy the requirements of
Code Section 422A with respect to Incentive Stock Options, and (2) by any
appropriate governmental agency. No Option may be granted during any
suspension or after termination of the Plan.
7.2 Ten (10) Year Maximum Term. Unless previously terminated by
the Committee, this Plan shall terminate on April 1, 2012, and no Options
shall be granted under the Plan thereafter.
7.3 Effect on Outstanding Options. Amendment, suspension or
termination of this Plan shall not, without the consent of the Optionee,
alter or impair any rights or obligations under any Option theretofore
granted.
8. EFFECTIVE DATE OF PLAN. This Plan shall be effective as of April 1,
2002, the date the Plan was adopted by the Board of Directors, subject to the
approval of the Plan by the affirmative vote of a majority of the issued and
outstanding Shares of common stock of the Corporation represented and voting
at a duly held meeting at which a quorum is present within twelve (12) months
thereafter. The Committee shall be authorized and empowered to make grants
of Options pursuant to this Plan prior to such approval of this Plan by the
stockholders; provided, however, in such event the Option grants shall be
made subject to the approval of both this Plan and such Option grants by the
stockholders in accordance with the provisions of this Section 8.
9. MISCELLANEOUS PROVISIONS.
9.1 Exculpation and Indemnification. The Corporation shall
indemnify and hold harmless the Committee from and against any and all
liabilities, costs and expenses incurred by such persons as a result of any
act, or omission to act, in connection with the performance of such persons'
duties, responsibilities and obligations under the Plan, other than such
liabilities, costs and expenses as may result from the gross negligence, bad
faith, willful conduct and/or criminal acts of such persons.
9.2 Governing Law. The Plan shall be governed and construed in
accordance with the laws of the State of North Dakota and the Code.
9.3 Compliance with Applicable Laws. The inability of the
Corporation to obtain from any regulatory body having jurisdiction authority
deemed by the Corporation's counsel to be necessary to the lawful issuance
and sale of any Shares upon the exercise of an Option shall relieve the
Corporation of any liability in respect of the non-issuance or sale of such
Shares as to which such requisite authority shall not have been obtained.
As approved by the Board of Directors on
February 8, 2002.
By:__________________________
RICHARD HANNIGAN, Secretary
EXHIBIT I
[FORM OF]
INCENTIVE STOCK OPTION AGREEMENT
THIS INCENTIVE STOCK OPTION AGREEMENT ("Agreement") is entered into as
of, by and between VOYAGER ENTERTAINMENT INTERNATIONAL, INC., a North Dakota
corporation ("Corporation"), and ("Optionee").
R E C I T A L S
A. On February 8, 2002, the Board of Directors of the Corporation
adopted the VOYAGER ENTERTAINMENT INTERNATIONAL, INC. 2002 Stock Option Plan
(the "Plan").
B. Pursuant to the Plan, on ________________, the Board of Directors
of the Corporation acting as the Plan Committee ("Committee") authorized
granting to Optionee options to purchase shares of the common stock, $.001
par value, of the Corporation ("Shares") for the term and subject to the
terms and conditions hereinafter set forth.
A G R E E M E N T
It is hereby agreed as follows:
1. CERTAIN DEFINITIONS. Unless otherwise defined herein, or the
context otherwise clearly requires, terms with initial capital letters used
herein shall have the meanings assigned to such terms in the Plan.
2. GRANT OF OPTIONS. The Corporation hereby grants to Optionee,
options ("Options") to purchase all or any part of Shares, upon
and subject to the terms and conditions of the Plan, which is incorporated in
full herein by this reference, and upon the other terms and conditions set
forth herein.
3. OPTION PERIOD. The Options shall be exercisable at any time during
the period commencing on the following dates (subject to the provisions of
Section 18) and expiring on the date ten (10) years from the date of grant,
unless earlier terminated pursuant to Section 7:
[terms of option vesting to be set forth here]
4. METHOD OF EXERCISE. The Options shall be exercisable by Optionee
by giving written notice to the Corporation of the election to purchase and
of the number of Shares Optionee elects to purchase, such notice to be
accompanied by such other executed instruments or documents as may be
required by the Committee pursuant to this Agreement, and unless otherwise
directed by the Committee, Optionee shall at the time of such exercise tender
the purchase price of the Shares he has elected to purchase. An Optionee may
purchase less than the total number of Shares for which the Option is
exercisable, provided that a partial exercise of an Option may not be for
less than One Hundred (100) Shares. If Optionee shall not purchase all of
the Shares which he is entitled to purchase under the Options, his right to
purchase the remaining unpurchased Shares shall continue until expiration of
the Options. The Options shall be exercisable with respect of whole Shares
only, and fractional Share interests shall be disregarded.
5. AMOUNT OF PURCHASE PRICE. The purchase price per Share for each
Share which Optionee is entitled to purchase under the Options shall be
per Share.
6. PAYMENT OF PURCHASE PRICE. At the time of Optionee's notice of
exercise of the Options, Optionee shall tender in cash or by certified or
bank cashier's check payable to the Corporation, the purchase price for all
Shares then being purchased. Provided, however, the Board of Directors may,
in its sole discretion, permit payment by the Corporation of the purchase
price in whole or in part with Shares. If the Optionee is so permitted, and
the Optionee elects to make payment with Shares, the Optionee shall deliver
to the Corporation certificates representing the number of Shares in payment
for new Shares, duly endorsed for transfer to the Corporation, together with
any written representations relating to title, liens and encumbrances,
securities laws, rules and regulatory compliance, or other matters,
reasonably requested by the Board of Directors. The value of Shares so
tendered shall be their Fair Market Value Per Share on the date of the
Optionee's notice of exercise.
7. EFFECT OF TERMINATION OF EMPLOYMENT. If an Optionee's employment
or other relationship with the Corporation (or a Subsidiary) terminates, the
effect of the termination on the Optionee's rights to acquire Shares shall be
as follows:
7.1 Termination for Other than Disability or Cause. If an
Optionee ceases to be employed by, or ceases to have a relationship with, the
Corporation or a Subsidiary for any reason other than for disability or
cause, such Optionee's Options shall expire not later than three (3) months
thereafter. During such three (3) month period and prior to the expiration
of the Option by its terms, the Optionee may exercise any Option granted to
him, but only to the extent such Options were exercisable on the date of
termination of his employment or relationship and except as so exercised,
such Options shall expire at the end of such three (3) month period unless
such Options by their terms expire before such date. The decision as to
whether a termination for a reason other than disability, cause or death has
occurred shall be made by the Committee, whose decision shall be final and
conclusive, except that employment shall not be considered terminated in the
case of sick leave or other bona fide leave of absence approved by the
Corporation.
7.2 Disability. If an Optionee ceases to be employed by, or
ceases to have a relationship with, the Corporation or a Subsidiary by reason
of disability (within the meaning of Code Section 22(e)(3)), such Optionee's
Options shall expire not later than one (1) year thereafter. During such
one (1) year period and prior to the expiration of the Option by its terms,
the Optionee may exercise any Option granted to him, but only to the extent
such Options were exercisable on the date the Optionee ceased to be employed
by, or ceased to have a relationship with, the Corporation or Subsidiary by
reason of disability. The decision as to whether a termination by reason of
disability has occurred shall be made by the Committee, whose decision shall
be final and conclusive.
7.3 Termination for Cause. If an Optionee's employment by, or
relationship with, the Corporation or a Subsidiary is terminated for cause,
such Optionee's Option shall expire immediately; provided, however, the
Committee may, in its sole discretion, within thirty (30) days of such
termination, waive the expiration of the Option by giving written notice of
such waiver to the Optionee at such Optionee's last known address. In the
event of such waiver, the Optionee may exercise the Option only to such
extent, for such time, and upon such terms and conditions as if such Optionee
had ceased to be employed by, or ceased to have a relationship with, the
Corporation or a Subsidiary upon the date of such termination for a reason
other than disability, cause or death. Termination for cause shall include
termination for malfeasance or gross misfeasance in the performance of duties
or conviction of illegal activity in connection therewith or any conduct
detrimental to the interests of the Corporation or a Subsidiary. The
determination of the Committee with respect to whether a termination for
cause has occurred shall be final and conclusive.
8. NONTRANSFERABILITY OF OPTIONS. The Options shall not be
transferable, either voluntarily or by operation of law, otherwise than by
will or the laws of descent and distribution and shall be exercisable during
the Optionee's lifetime only by Optionee.
9. ADDITIONAL RESTRICTIONS REGARDING DISPOSITIONS OF SHARES. The
Shares acquired pursuant to the exercise of Options shall be subject to the
restrictions set forth in Exhibit "A" attached hereto and incorporated herein
as if fully set forth.
10. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. As used herein, the
term "Adjustment Event" means an event pursuant to which the outstanding
Shares of the Corporation are increased, decreased or changed into, or
exchanged for a different number or kind of shares or securities, without
receipt of consideration by the Corporation, through reorganization, merger,
recapitalization, reclassification, stock split, reverse stock split, stock
dividend, stock consolidation or otherwise. Upon the occurrence of an
Adjustment Event, (i) appropriate and proportionate adjustments shall be made
to the number and kind and exercise price for the shares subject to the
Options, and (ii) appropriate amendments to this Agreement shall be executed
by the Corporation and Optionee if the Committee determines that such an
amendment is necessary or desirable to reflect such adjustments. If
determined by the Committee to be appropriate, in the event of an Adjustment
Event which involves the substitution of securities of a corporation other
than the Corporation, the Committee shall make arrangements for the
assumptions by such other corporation of the Options. Notwithstanding the
foregoing, any such adjustment to the Options shall be made without change in
the total exercise price applicable to the unexercised portion of the
Options, but with an appropriate adjustment to the number of shares, kind of
shares and exercise price for each share subject to the Options. The
determination by the Committee as to what adjustments, amendments or
arrangements shall be made pursuant to this Section 10, and the extent
thereof, shall be final and conclusive. No fractional Shares shall be issued
on account of any such adjustment or arrangement.
11. NO RIGHTS TO CONTINUED EMPLOYMENT OR RELATIONSHIP. Nothing
contained in this Agreement shall obligate the Corporation to employ or have
another relationship with Optionee for any period or interfere in any way
with the right of the Corporation to reduce Optionee's compensation or to
terminate the employment of or relationship with Optionee at any time.
12. TIME OF GRANTING OPTIONS. The time the Options shall be deemed
granted, sometimes referred to herein as the "date of grant," shall be .
13. PRIVILEGES OF STOCK OWNERSHIP. Optionee shall not be entitled to
the privileges of stock ownership as to any Shares not actually issued and
delivered to Optionee. No Shares shall be purchased upon the exercise of any
Options unless and until, in the opinion of the Corporation's counsel, any
then applicable requirements of any laws, or governmental or regulatory
agencies having jurisdiction, and of any exchanges upon which the stock of
the Corporation may be listed shall have been fully complied with.
14. SECURITIES LAWS COMPLIANCE. The Corporation will diligently
endeavor to comply with all applicable securities laws before any stock is
issued pursuant to the Options. Without limiting the generality of the
foregoing, the Corporation may require from the Optionee such investment
representation or such agreement, if any, as counsel for the Corporation may
consider necessary in order to comply with the Securities Act of 1933 as then
in effect, and may require that the Optionee agree that any sale of the
Shares will be made only in such manner as is permitted by the Committee.
The Committee may in its discretion cause the Shares underlying the Options
to be registered under the Securities Act of 1933 as amended by filing a Form
S-8 Registration Statement covering the Options and the Shares underlying the
Options. Optionee shall take any action reasonably requested by the
Corporation in connection with registration or qualification of the Shares
under federal or state securities laws.
15. INTENDED TREATMENT AS INCENTIVE STOCK OPTIONS. The Options granted
herein are intended to be "incentive stock options" to which Sections 421 and
422A of the Internal Revenue Code of 1986, as amended from time to time
("Code") apply, and shall be construed to implement that intent. If all or
any part of the Options shall not be subject to Sections 421 and 422A of the
Code, the Options shall nevertheless be valid and carried into effect.
16. PLAN CONTROLS. The Options shall be subject to and governed by the
provisions of the Plan. All determinations and interpretations of the Plan
made by the Committee shall be final and conclusive.
17. SHARES SUBJECT TO LEGEND. If deemed necessary by the Corporation's
counsel, all certificates issued to represent Shares purchased upon exercise
of the Options shall bear such appropriate legend conditions as counsel for
the Corporation shall require.
18. CONDITIONS TO OPTIONS.
18.1 Compliance with Applicable Laws. THE CORPORATION'S OBLIGATION
TO ISSUE SHARES OF ITS COMMON STOCK UPON EXERCISE OF THE OPTIONS IS EXPRESSLY
CONDITIONED UPON THE COMPLETION BY THE CORPORATION OF ANY REGISTRATION OR
OTHER QUALIFICATION OF SUCH SHARES UNDER ANY STATE AND/OR FEDERAL LAW OR
RULINGS OR REGULATIONS OF ANY GOVERNMENTAL REGULATORY BODY, OR THE MAKING OF
SUCH INVESTMENT REPRESENTATIONS OR OTHER REPRESENTATIONS AND UNDERTAKINGS BY
THE OPTIONEE OR ANY PERSON ENTITLED TO EXERCISE THE OPTION IN ORDER TO COMPLY
WITH THE REQUIREMENTS OF ANY EXEMPTION FROM ANY SUCH REGISTRATION OR OTHER
QUALIFICATION OF SUCH SHARES WHICH THE COMMITTEE SHALL, IN ITS SOLE
DISCRETION, DEEM NECESSARY OR ADVISABLE. SUCH REQUIRED REPRESENTATIONS AND
UNDERTAKINGS MAY INCLUDE REPRESENTATIONS AND AGREEMENTS THAT THE OPTIONEE OR
ANY PERSON ENTITLED TO EXERCISE THE OPTION (i) IS NOT PURCHASING SUCH SHARES
FOR DISTRIBUTION AND (ii) AGREES TO HAVE PLACED UPON THE FACE AND REVERSE OF
ANY CERTIFICATES A LEGEND SETTING FORTH ANY REPRESENTATIONS AND UNDERTAKINGS
WHICH HAVE BEEN GIVEN TO THE COMMITTEE OR A REFERENCE THERETO.
18.2 SHAREHOLDER APPROVAL OF PLAN. IF THE OPTIONS GRANTED HEREBY
ARE GRANTED PRIOR TO APPROVAL OF THE PLAN BY THE SHAREHOLDERS OF THE
CORPORATION PURSUANT TO SECTION 8 OF THE PLAN, THE GRANT OF THE OPTIONS MADE
HEREBY IS EXPRESSLY CONDITIONED UPON AND SUCH OPTIONS SHALL NOT BE
EXERCISABLE UNTIL THE APPROVAL OF THE PLAN BY THE SHAREHOLDERS OF THE
CORPORATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 8 OF THE PLAN.
18.3 Maximum Exercise Period. Notwithstanding any provision of
this Agreement to the contrary, the Options shall expire no later than ten
years from the date hereof or five years if, as of the date hereof, the
Optionee owns or is considered to own by reason of Code Section 425(d) more
than 10% of the total combined voting power of all classes of stock of the
Corporation or any Subsidiary or parent corporation of the Corporation.
19. MISCELLANEOUS.
19.1 Binding Effect. This Agreement shall bind and inure to the
benefit of the successors, assigns, transferees, agents, personal
representatives, heirs and legatees of the respective parties.
19.2 Further Acts. Each party agrees to perform any further acts
and execute and deliver any documents which may be necessary to carry out the
provisions of this Agreement.
19.3 Amendment. This Agreement may be amended at any time by the
written agreement of the Corporation and the Optionee.
19.4 Syntax. Throughout this Agreement, whenever the context so
requires, the singular shall include the plural, and the masculine gender
shall include the feminine and neuter genders. The headings and captions of
the various Sections hereof are for convenience only and they shall not
limit, expand or otherwise affect the construction or interpretation of this
Agreement.
19.5 Choice of Law. The parties hereby agree that this Agreement
has been executed and delivered in the State of North Dakota and shall be
construed, enforced and governed by the laws thereof. This Agreement is in
all respects intended by each party hereto to be deemed and construed to have
been jointly prepared by the parties and the parties hereby expressly agree
that any uncertainty or ambiguity existing herein shall not be interpreted
against either of them.
19.6 Severability. In the event that any provision of this
Agreement shall be held invalid or unenforceable, such provision shall be
severable from, and such invalidity or unenforceability shall not be
construed to have any effect on, the remaining provisions of this Agreement.
19.7 Notices. All notices and demands between the parties hereto
shall be in writing and shall be served either by registered or certified
mail, and such notices or demands shall be deemed given and made forty-eight
(48) hours after the deposit thereof in the United States mail, postage
prepaid, addressed to the party to whom such notice or demand is to be given
or made, and the issuance of the registered receipt therefor. If served by
telegraph, such notice or demand shall be deemed given and made at the time
the telegraph agency shall confirm to the sender, delivery thereof to the
addressee. All notices and demands to Optionee or the Corporation may be
given to them at the following addresses:
If to Optionee:
If to Corporation: VOYAGER ENTERTAINMENT INTERNATIONAL, INC.
Such parties may designate in writing from time to time such other place or
places that such notices and demands may be given.
19.8 Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto pertaining to the subject matter hereof,
this Agreement supersedes all prior and contemporaneous agreements and
understandings of the parties, and there are no warranties, representations
or other agreements between the parties in connection with the subject
matter hereof except as set forth or referred to herein. No supplement,
modification or waiver or termination of this Agreement shall be binding
unless executed in writing by the party to be bound thereby. No waiver of
any of the provisions of this Agreement shall constitute a waiver of any
other provision hereof (whether or not similar) nor shall such waiver
constitute a continuing waiver.
19.9 Attorneys' Fees. In the event that any party to this
Agreement institutes any action or proceeding, including, but not limited to,
litigation or arbitration, to preserve, to protect or to enforce any right or
benefit created by or granted under this Agreement, the prevailing party in
each respective such action or proceeding shall be entitled, in addition to
any and all other relief granted by a court or other tribunal or body, as may
be appropriate, to an award in such action or proceeding of that sum of money
which represents the attorneys' fees reasonably incurred by the prevailing
party therein in filing or otherwise instituting and in prosecuting or
otherwise pursuing or defending such action or proceeding, and, additionally,
the attorneys' fees reasonably incurred by such prevailing party in
negotiating any and all matters underlying such action or proceeding and in
preparation for instituting or defending such action or proceeding.
IN WITNESS WHEREOF, the parties have entered into this Agreement as
of the date first set forth above.
"CORPORATION"
VOYAGER ENTERTAINMENT
INTERNATIONAL, INC.
a North Dakota corporation
By:
Secretary
"OPTIONEE"
EXHIBIT II
[FORM OF]
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT ("Agreement") is entered into
as of , by and between VOYAGER ENTERTAINMENT
INTERNATIONAL, INC., a North Dakota corporation ("Corporation"), and
____________________ ("Optionee").
R E C I T A L S
A. On February 8, 2002, the Board of Directors of the Corporation
adopted, subject to the approval of the Corporation's shareholders, the
VOYAGER ENTERTAINMENT INTERNATIONAL, INC. 2002 Stock Option Plan (the
"Plan").
B. Pursuant to the Plan, on , the Board of
Directors of the Corporation acting as the Plan Committee ("Committee")
authorized granting to Optionee options to purchase shares of the common
stock, $.001 par value, of the Corporation ("Shares") for the term and
subject to the terms and conditions hereinafter set forth.
A G R E E M E N T
It is hereby agreed as follows:
1. CERTAIN DEFINITIONS. Unless otherwise defined herein, or the
context otherwise clearly requires, terms with initial capital letters used
herein shall have the meanings assigned to such terms in the Plan.
2. GRANT OF OPTIONS. The Corporation hereby grants to Optionee,
options ("Options") to purchase all or any part of __________ Shares, upon
and subject to the terms and conditions of the Plan, which is incorporated in
full herein by this reference, and upon the other terms and conditions set
forth herein.
3. OPTION PERIOD. The Options shall be exercisable at any time during
the period commencing on the following dates (subject to the provisions of
Section 18) and expiring on the date five (5) years from the date of grant,
unless earlier terminated pursuant to Section 7:
[Terms of vesting to be set forth here]
4. METHOD OF EXERCISE. The Options shall be exercisable by Optionee
by giving written notice to the Corporation of the election to purchase and
of the number of Shares Optionee elects to purchase, such notice to be
accompanied by such other executed instruments or documents as may be
required by the Committee pursuant to this Agreement, and unless otherwise
directed by the Committee, Optionee shall at the time of such exercise tender
the purchase price of the Shares he has elected to purchase. An Optionee may
purchase less than the total number of Shares for which the Option is
exercisable, provided that a partial exercise of an Option may not be for
less than One Hundred (100) Shares. If Optionee shall not purchase all of
the Shares which he is entitled to purchase under the Options, his right to
purchase the remaining unpurchased Shares shall continue until expiration of
the Options. The Options shall be exercisable with respect of whole Shares
only, and fractional Share interests shall be disregarded.
5. AMOUNT OF PURCHASE PRICE. The purchase price per Share for each
Share which Optionee is entitled to purchase under the Options shall be $
per Share.
6. PAYMENT OF PURCHASE PRICE. At the time of Optionee's notice of
exercise of the Options, Optionee shall tender in cash or by certified or
bank cashier's check payable to the Corporation, the purchase price for all
Shares then being purchased. Provided, however, the Board of Directors may,
in its sole discretion, permit payment by the Corporation of the purchase
price in whole or in part with Shares. If the Optionee is so permitted, and
the Optionee elects to make payment with Shares, the Optionee shall deliver
to the Corporation certificates representing the number of Shares in payment
for new Shares, duly endorsed for transfer to the Corporation, together with
any written representations relating to title, liens and encumbrances,
securities laws, rules and regulatory compliance, or other matters,
reasonably requested by the Board of Directors. The value of Shares so
tendered shall be their Fair Market Value Per Share on the date of the
Optionee's notice of exercise.
7. EFFECT OF TERMINATION OF RELATIONSHIP OR DEATH. If Optionee's
relationship with the Corporation as a director terminates (whether
voluntarily or involuntarily because he is not re-elected by the
shareholders), or if optionee dies, all options which have previously vested
shall expire six (6) months thereafter. All unvested options shall laps and
automatically expire. During such six (6) month period (or such shorter
period prior to the expiration of the Option by its own terms), such Options
may be exercised by the Optionee, his executor or administrator or the person
or persons to whom the Option is transferred by will or the applicable laws
of descent and distribution, as the case may be, but only to the extent such
Options were exercisable on the date Optionee ceased to have a relationship
with the Corporation as a director or died.
8. NONTRANSFERABILITY OF OPTIONS. The Options shall not be
transferable, either voluntarily or by operation of law, otherwise than by
will or the laws of descent and distribution and shall be exercisable during
the Optionee's lifetime only by Optionee.
9. ADDITIONAL RESTRICTIONS REGARDING DISPOSITIONS OF SHARES. The
Shares acquired pursuant to the exercise of Options shall be subject to the
restrictions set forth in Exhibit "A" attached hereto and incorporated herein
as if fully set forth.
10. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. As used herein, the
term "Adjustment Event" means an event pursuant to which the outstanding
Shares of the Corporation are increased, decreased or changed into, or
exchanged for a different number or kind of shares or securities, without
receipt of consideration by the Corporation, through reorganization, merger,
recapitalization, reclassification, stock split, reverse stock split, stock
dividend, stock consolidation or otherwise. Upon the occurrence of an
Adjustment Event, (i) appropriate and proportionate adjustments shall be made
to the number and kind and exercise price for the shares subject to the
Options, and (ii) appropriate amendments to this Agreement shall be executed
by the Corporation and Optionee if the Committee determines that such an
amendment is necessary or desirable to reflect such adjustments. If
determined by the Committee to be appropriate, in the event of an Adjustment
Event which involves the substitution of securities of a corporation other
than the Corporation, the Committee shall make arrangements for the
assumptions by such other corporation of the Options. Notwithstanding the
foregoing, any such adjustment to the Options shall be made without change in
the total exercise price applicable to the unexercised portion of the
Options, but with an appropriate adjustment to the number of shares, kind of
shares and exercise price for each share subject to the Options. The
determination by the Committee as to what adjustments, amendments or
arrangements shall be made pursuant to this Section 10, and the extent
thereof, shall be final and conclusive. No fractional Shares shall be issued
on account of any such adjustment or arrangement.
11. NO RIGHTS TO CONTINUED EMPLOYMENT OR RELATIONSHIP. Nothing
contained in this Agreement shall obligate the Corporation to employ or have
another relationship with Optionee for any period or interfere in any way
with the right of the Corporation to reduce Optionee's compensation or to
terminate the employment of or relationship with Optionee at any time.
12. TIME OF GRANTING OPTIONS. The time the Options shall be deemed
granted, sometimes referred to herein as the "date of grant," shall be
..
13. PRIVILEGES OF STOCK OWNERSHIP. Optionee shall not be entitled to
the privileges of stock ownership as to any Shares not actually issued and
delivered to Optionee. No Shares shall be purchased upon the exercise of any
Options unless and until, in the opinion of the Corporation's counsel, any
then applicable requirements of any laws, or governmental or regulatory
agencies having jurisdiction, and of any exchanges upon which the stock of
the Corporation may be listed shall have been fully complied with.
14. SECURITIES LAWS COMPLIANCE. The Corporation will diligently
endeavor to comply with all applicable securities laws before any stock is
issued pursuant to the Options. Without limiting the generality of the
foregoing, the Corporation may require from the Optionee such investment
representation or such agreement, if any, as counsel for the Corporation may
consider necessary in order to comply with the Securities Act of 1933 as then
in effect, and may require that the Optionee agree that any sale of the
Shares will be made only in such manner as is permitted by the Committee.
The Committee may in its discretion cause the Shares underlying the Options
to be registered under the Securities Act of 1933 as amended by filing a Form
S-8 Registration Statement covering the Options and the Shares underlying the
Options. Optionee shall take any action reasonably requested by the
Corporation in connection with registration or qualification of the Shares
under federal or state securities laws.
15. INTENDED TREATMENT AS NON-QUALIFIED STOCK OPTIONS. The Options
granted herein are intended to be non-qualified stock options described in
U.S. Treasury Regulation ("Treas. Reg.") ?1.83-7 to which Sections 421 and
422A of the Internal Revenue Code of 1986, as amended from time to time
("Code") do not apply, and shall be construed to implement that intent. If
all or any part of the Options shall not be described in Treas. Reg. 1.83-7
or be subject to Sections 421 and 422A of the Code, the Options shall
nevertheless be valid and carried into effect.
16. PLAN CONTROLS. The Options shall be subject to and governed by the
provisions of the Plan. All determinations and interpretations of the Plan
made by the Committee shall be final and conclusive.
17. SHARES SUBJECT TO LEGEND. If deemed necessary by the Corporation's
counsel, all certificates issued to represent Shares purchased upon exercise
of the Options shall bear such appropriate legend conditions as counsel for
the Corporation shall require.
18. CONDITIONS TO OPTIONS.
18.1 Compliance with Applicable Laws. THE CORPORATION'S OBLIGATION TO ISSUE
SHARES OF ITS COMMON STOCK UPON EXERCISE OF THE OPTIONS IS EXPRESSLY
CONDITIONED UPON THE COMPLETION BY THE CORPORATION OF ANY REGISTRATION OR
OTHER QUALIFICATION OF SUCH SHARES UNDER ANY STATE AND/OR FEDERAL LAW OR
RULINGS OR REGULATIONS OF ANY GOVERNMENTAL REGULATORY BODY, OR THE MAKING OF
SUCH INVESTMENT REPRESENTATIONS OR OTHER REPRESENTATIONS AND UNDERTAKINGS BY
THE OPTIONEE OR ANY PERSON ENTITLED TO EXERCISE THE OPTION IN ORDER TO COMPLY
WITH THE REQUIREMENTS OF ANY EXEMPTION FROM ANY SUCH REGISTRATION OR OTHER
QUALIFICATION OF SUCH SHARES WHICH THE COMMITTEE SHALL, IN ITS SOLE
DISCRETION, DEEM NECESSARY OR ADVISABLE. SUCH REQUIRED REPRESENTATIONS AND
UNDERTAKINGS MAY INCLUDE REPRESENTATIONS AND AGREEMENTS THAT THE OPTIONEE OR
ANY PERSON ENTITLED TO EXERCISE THE OPTION (i) IS NOT PURCHASING SUCH SHARES
FOR DISTRIBUTION AND (ii) AGREES TO HAVE PLACED UPON THE FACE AND REVERSE OF
ANY CERTIFICATES A LEGEND SETTING FORTH ANY REPRESENTATIONS AND UNDERTAKINGS
WHICH HAVE BEEN GIVEN TO THE COMMITTEE OR A REFERENCE THERETO.
18.2 SHAREHOLDER APPROVAL OF PLAN. IF THE OPTIONS GRANTED HEREBY
ARE GRANTED PRIOR TO APPROVAL OF THE PLAN BY THE SHAREHOLDERS OF THE
CORPORATION PURSUANT TO SECTION 8 OF THE PLAN, THE GRANT OF THE OPTIONS MADE
HEREBY IS EXPRESSLY CONDITIONED UPON AND SUCH OPTIONS SHALL NOT BE
EXERCISABLE UNTIL THE APPROVAL OF THE PLAN BY THE SHAREHOLDERS OF THE
CORPORATION IN ACCORDANCE WITH THE PROVISIONS OF SECTION 8 OF THE PLAN.
19. MISCELLANEOUS.
19.1 Binding Effect. This Agreement shall bind and inure to the
benefit of the successors, assigns, transferees, agents, personal
representatives, heirs and legatees of the respective parties.
19.2 Further Acts. Each party agrees to perform any further acts
and execute and deliver any documents which may be necessary to carry out the
provisions of this Agreement.
19.3 Amendment. This Agreement may be amended at any time by the
written agreement of the Corporation and the Optionee.
19.4 Syntax. Throughout this Agreement, whenever the context so
requires, the singular shall include the plural, and the masculine gender
shall include the feminine and neuter genders. The headings and captions of
the various Sections hereof are for convenience only and they shall not
limit, expand or otherwise affect the construction or interpretation of this
Agreement.
19.5 Choice of Law. The parties hereby agree that this Agreement
has been executed and delivered in the State of North Dakota and shall be
construed, enforced and governed by the laws thereof. This Agreement is in
all respects intended by each party hereto to be deemed and construed to have
been jointly prepared by the parties and the parties hereby expressly agree
that any uncertainty or ambiguity existing herein shall not be interpreted
against either of them.
19.6 Severability. In the event that any provision of this
Agreement shall be held invalid or unenforceable, such provision shall be
severable from, and such invalidity or unenforceability shall not be
construed to have any effect on, the remaining provisions of this Agreement.
19.7 Notices. All notices and demands between the parties hereto
shall be in writing and shall be served either by registered or certified
mail, and such notices or demands shall be deemed given and made forty-eight
(48) hours after the deposit thereof in the United States mail, postage
prepaid, addressed to the party to whom such notice or demand is to be given
or made, and the issuance of the registered receipt therefor. If served by
telegraph, such notice or demand shall be deemed given and made at the time
the telegraph agency shall confirm to the sender, delivery thereof to the
addressee. All notices and demands to Optionee or the Corporation may be
given to them at the following addresses:
If to Optionee:
If to Corporation: VOYAGER ENTERTAINMENT
INTERNATIONAL, INC.
Such parties may designate in writing from time to time such other place or
places that such notices and demands may be given.
19.8 Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto pertaining to the subject matter hereof,
this Agreement supersedes all prior and contemporaneous agreements and
understandings of the parties, and there are no warranties, representations
or other agreements between the parties in connection with the subject matter
hereof except as set forth or referred to herein. No supplement,
modification or waiver or termination of this Agreement shall be binding
unless executed in writing by the party to be bound thereby. No waiver of
any of the provisions of this Agreement shall constitute a waiver of any
other provision hereof (whether or not similar) nor shall such waiver
constitute a continuing waiver.
19.9 Attorneys' Fees. In the event that any party to this
Agreement institutes any action or proceeding, including, but not limited to,
litigation or arbitration, to preserve, to protect or to enforce any right or
benefit created by or granted under this Agreement, the prevailing party in
each respective such action or proceeding shall be entitled, in addition to
any and all other relief granted by a court or other tribunal or body, as may
be appropriate, to an award in such action or proceeding of that sum of money
which represents the attorneys' fees reasonably incurred by the prevailing
party therein in filing or otherwise instituting and in prosecuting or
otherwise pursuing or defending such action or proceeding, and, additionally,
the attorneys' fees reasonably incurred by such prevailing party in
negotiating any and all matters underlying such action or proceeding and in
preparation for instituting or defending such action or proceeding.
IN WITNESS WHEREOF, the parties have entered into this Agreement as
of the date first set forth above.
"CORPORATION"
VOYAGER ENTERTAINMENT
INTERNATIONAL, INC.
a North Dakota corporation
By:
Secretary
"OPTIONEE"