-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, D+TOajX1Ig8eFeyNVy7e7ijl2F+tg7/pYu3z0b3k+gekbmliX9ZlqwvZQWU+pILM wYIfocO6poB301aydDjMiA== 0001165527-05-000252.txt : 20050915 0001165527-05-000252.hdr.sgml : 20050915 20050915085052 ACCESSION NUMBER: 0001165527-05-000252 CONFORMED SUBMISSION TYPE: SB-2 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20050915 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Ammogem Corp. CENTRAL INDEX KEY: 0001332584 IRS NUMBER: 330952419 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SB-2 SEC ACT: 1933 Act SEC FILE NUMBER: 333-128335 FILM NUMBER: 051085655 BUSINESS ADDRESS: STREET 1: 2316 A WILLEMAR AVENUE CITY: COURTENAY STATE: A1 ZIP: V9N 3M8 BUSINESS PHONE: 250-898-8882 MAIL ADDRESS: STREET 1: 2316 A WILLEMAR AVENUE CITY: COURTENAY STATE: A1 ZIP: V9N 3M8 SB-2 1 g0958.txt FORM SB-2 OF AMMOGEM CORP As Filed With the Securities and Exchange Commission on September 14, 2005 Registration No.333-______ ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM SB-2 Registration Statement Under the Securities Act of 1934 AMMOGEM CORP. (Name of Small Business Issuer in Its Charter)
DELAWARE 5094 33-0952419 (State or jurisdiction of (Primary Standard Industrial (IRS Employer incorporation or organization) Classification Code Number) Identification Number)
2316A Willemar Avenue Courtenay, BC Canada V9N 3M8 (250) 898-8882 (Address of Principal Executive Offices) (Telephone Number) Karen Batcher 4252 Bonita Road #151 Bonita, CA 91902 (619) 475-7882 (Name and Address of Agent for Service) (Telephone Number) Approximate Date of Proposed Sale to the Public: As soon as practicable after the effective date of this Registration Statement. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. [ ]
CALCULATION OF REGISTRATION FEE ================================================================================================ Title of Each Proposed Proposed Class of Maximum Maximum Securities Offering Aggregate Amount of to be Amount to be Price Offering Registration Registered Registered Per Unit (1) Price (2) Fee - ------------------------------------------------------------------------------------------------ Common Stock $.0001 par value to be sold by selling shareholders 142,600 $0.50 $ 71,300 $ 8.39 - ------------------------------------------------------------------------------------------------ Common Stock $.0001 par value to be sold by the company 300,000 $0.50 $150,000 $17.66 - ------------------------------------------------------------------------------------------------ TOTAL 442,600 $0.50 $221,300 $26.05 ================================================================================================
(1) Fixed offering price was set by the company until securities are quoted on the OTC Bulletin Board and thereafter at prevailing market prices or privately negotiated prices. (2) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457 under the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. ================================================================================ PROSPECTUS AMMOGEM CORP. 442,600 SHARES OF COMMON STOCK This is our initial public offering. We are registering a total of 442,600 shares of our common stock. Of the shares being registered, 142,600 are being registered for sale by the selling shareholders, and 300,000 are being registered for sale by the Company. All of the shares being registered for sale by the Company will be sold at a price per share of $0.50 for the duration of the offering. The selling shareholders will sell their shares at a price per share of $0.50 until our shares are quoted on the Over the Counter Bulletin Board and thereafter at prevailing market prices or in privately negotiated transactions. We will not receive any proceeds from the sale of any of the 142,600 shares by the selling shareholders. We will be selling all of the 300,000 shares of common stock we are offering as a self underwritten offering. There is no minimum amount we are required to raise in this offering and any funds received will be immediately available to us. This offering will terminate on the earlier of the sale of all of the 442,600 shares offered or 180 days after the date of the prospectus. There is no established public market for our common stock and we have arbitrarily determined the offering price. Our Common Stock is not currently listed or quoted on any quotation service. There can be no assurance that our common stock will ever be quoted or that any market for our stock will ever develop. INVESTORS IN THE COMMON STOCK SHOULD HAVE THE ABILITY TO LOSE THEIR ENTIRE INVESTMENT SINCE AN INVESTMENT IN THE COMMON STOCK IS SPECULATIVE AND SUBJECT TO MANY RISKS. SEE SECTION ENTITLED "RISK FACTORS" ON PAGE 5. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. NONE OF THESE SECURITIES MAY BE SOLD UNTIL A REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THE PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
Per Share Per Share Number Per Share Underwriting discounts Proceeds Proceeds of Shares Price to public and commissions to Company to Shareholders Available For Sale --------------- --------------- ---------- --------------- ------------------ $ 0.50 $0.00 $ 0.50 $ 0.00 300,000 $ 0.50 $0.00 $ 0.00 $ 0.50 142,600 -------- ----- -------- ------- ------- Total $221,300 $0.00 $150,000 $71,300 442,600 ======== ===== ======== ======= =======
The date of this Prospectus is ________ __, 200__. TABLE OF CONTENTS SUMMARY .................................................................... 3 RISK FACTORS ............................................................... 4 FORWARD LOOKING STATEMENTS ................................................. 6 USE OF PROCEEDS ............................................................ 7 DETERMINATION OF OFFERING PRICE ............................................ 8 DILUTION ................................................................... 8 SELLING SECURITY HOLDERS ................................................... 10 PLAN OF DISTRIBUTION ....................................................... 12 LEGAL PROCEEDINGS .......................................................... 14 DIRECTORS, OFFICERS, PROMOTERS AND CONTROL PERSONS ......................... 14 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT ............. 16 DESCRIPTION OF SECURITIES .................................................. 17 INTEREST OF NAMED EXPERTS AND COUNSEL ...................................... 17 SECURITIES ACT INDEMNIFICATION DISCLOSURE .................................. 17 ORGANIZATION WITHIN LAST FIVE YEARS ........................................ 18 DESCRIPTION OF BUSINESS .................................................... 18 PLAN OF OPERATION .......................................................... 24 DESCRIPTION OF PROPERTY .................................................... 26 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS ............................. 27 MARKET FOR COMMON EQUITY AND OTHER SHAREHOLDER MATTERS ..................... 27 EXECUTIVE COMPENSATION ..................................................... 28 FINANCIAL STATEMENTS ....................................................... 28 CHANGES IN OR DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE ...................................................... 28 2 SUMMARY Ammogem Corp. was incorporated in Delaware on December 7, 2000 as All Asia Imports, Inc. On April 26, 2004 the company filed an amended Certificate of Incorporation to change the name to Ammogem Corp. The company was incorporated by its resident agent and had no operations from the time of its original formation in December 2000 until Mr. Jean was elected and began initial operations in pursuit of the company's current business plan goals. While we are in our development stage, we have commenced our initial operations and our business plan includes the generation of revenues within twelve to eighteen months. We intend to provide customers with a variety of Ammonite gemstone products including complete fossil pieces, jewelry, do-it-yourself polishing kits and Feng Shui healing stones. Our principal executive offices are located at 2316A Willemar Avenue, Courtenay, BC Canada V9N 3M8. The telephone number is (250)898-8882. We received our initial funding of $14,660 through the sale of 142,600 common stock shares to 43 non-affiliated private investors from July 2004 until January 2005, and 3,000,000 shares to our director and president Lawrence Jean and two affiliated parties. Subsequent to that sale Mr. Jean purchased in private transactions the 2,000,000 shares held by the affiliated parties, resulting in Mr. Jean now holding 3,000,000 shares. From inception until the date of this filing we have been in our development stage, we have recently commenced our initial operations and our business plan includes the generation of revenues within twelve to eighteen months. Our audited financial statements for the years ended December 31, 2004 and 2003 and the six months ended June 30, 2005 report a cash balance of $5,664, no revenues and a cumulative net loss since inception of $11,896. OFFERING Securities Being Offered 442,600 shares of common stock, 300,000 which we are offering, and 142,600 which are being offered by the selling shareholders. All shares will be offered at a price of $0.50 per share. This offering will terminate on the earlier of the sale of all of the 442,600 shares or 180 days after the date of the prospectus. Price per share $0.50 as determined by company. The selling shareholders will sell their shares at a fixed price per share of $0.50 until our shares are quoted on the Over the Counter Bulletin Board and thereafter at prevailing market prices or in privately negotiated transactions. All of the shares being registered for sale by the company will be sold at a fixed price per share of $0.50 for the duration of the offering. Securities Issued And Outstanding 3,142,600 shares of common stock are issued and outstanding before the offering and 3,442,600 will be outstanding after the offering. Registration costs We estimate our total offering registration costs to be $5,000. If we experience a shortage of funds prior to funding, our director has informally agreed to advance funds to allow us to pay for offering costs, filing fees, and correspondence with our shareholders, however, our director has no formal commitment or legal obligation to advance or loan funds to the company. 3 RISK FACTORS This section includes all the material risk factors associated with this offering and investors in Ammogem should carefully consider each prior to making an investment in our stock: WE ARE A DEVELOPMENT STAGE COMPANY AND HAVE BEGUN TAKING STEPS IN FURTHERANCE OF OUR BUSINESS PLAN. WE EXPECT TO INCUR OPERATING LOSSES FOR THE NEXT TWELVE MONTHS. IF OUR LOSSES EXCEED OUR ABILITY TO GENERATE CONTINUED FUNDING, WE MAY BE UNABLE TO CONTINUE OPERATIONS AND WILL CEASE ANY ACTIVITY; THEREFORE YOU COULD LOSE YOUR ENTIRE INVESTMENT. Since inception, we have not earned any revenue and do not anticipate earning any revenue over the next twelve months. We intend to take the steps necessary to execute our business plan over the next twelve months as we incur additional operating expenses. Management plans to complete all of our business plans steps over the next twelve months, but if we receive only partial funding, we will continue our operations at a reduced level. If no funding is generated, we will be unable to continue operations. OUR FINANCIAL STATUS CREATES A DOUBT WHETHER WE WILL CONTINUE AS A GOING CONCERN. OUR INDEPENDENT AUDITORS HAVE ISSUED AN AUDIT OPINION WHICH INCLUDES A STATEMENT DESCRIBING OUR GOING CONCERN STATUS. IF OUR BUSINESS PLAN FOR THE FUTURE IS NOT SUCCESSFUL, INVESTORS WILL LIKELY LOSE ALL OF THEIR INVESTMENT IN OUR STOCK. As described in Note 4 of our accompanying financial statements, our cumulative losses to date of $11,896 and our lack of any guaranteed sources of future capital create substantial doubt as to our ability to continue as a going concern. If our business plan does not work, we could remain as a start-up company with no revenues or profits. AMMOGEM HAS NO SALES, PROVEN MARKET, OR CONSUMER DEMAND. WITHOUT SIGNIFICANT USER DEMAND FOR OUR PRODUCTS, THE COMPANY COULD HAVE CONTINUED NEGATIVE CASH FLOW AND BE UNABLE TO REMAIN IN BUSINESS. The lack of a proven market for our products means that the true market for them may be minor or nonexistent. This could result in little or no revenue. OUR BUSINESS STRATEGY REQUIRES US TO RAISE CASH OF $150,000. WITHOUT THIS FUNDING, WE COULD REMAIN AS A DEVELOPMENT STAGE COMPANY WITH NO REVENUES OR PROFITS AND MAY BE ONLY PARTIALLY SUCCESSFUL OR COMPLETELY UNSUCCESSFUL IN IMPLEMENTING OUR BUSINESS PLAN, RESULTING IN OUR SHAREHOLDERS LOSING PART OR ALL OF THEIR INVESTMENT. We intend to raise $150,000 in funding (net of $145,000 after offering fees) in order to finance our operations. We believe the most likely source of our funding is through a future sale of common stock in order to complete our current business plan. We have not yet identified any specific individuals or entities needed to provide our funding. Without this funding, we could remain as a start-up company accomplishing only the initial phase of our operations. If we use equity capital as a source of funding, potential new shareholders may be unwilling to accept either the 4 likely dilution of their per share value or the high level of risk involved with our unproven services. Without this funding, we may be only partially successful or completely unsuccessful in implementing our business plan, and our shareholders may lose part or all of their investment. ALL 300,000 SHARES BEING REGISTERED FOR SALE BY THE COMPANY WILL BE SOLD AT A FIXED PRICE PER SHARE OF $0.50 FOR THE DURATION OF THE OFFERING. THE 142,600 SHARES BEING REGISTERED FOR SALE BY THE SELLING SHAREHOLDERS WILL BE OFFERED AT A FIXED PRICE OF $0.50 PER SHARE UNTIL THE COMMON STOCK IS QUOTED ON THE OTC BULLETIN BOARD AND THEREAFTER AT PREVAILING MARKET PRICES, WHICH COULD BE AT A PRICE LOWER THAN THE COMPANY IS REQUIRED TO SELL THEIR SHARES FOR. Once the shares are quoted on the OTC Bulletin Board the selling shareholders may sell their shares directly into any market created and at prices that will be determined by market conditions. If the shareholders choose to sell their shares at a price less than the fixed price of $0.50 that the company must offer their shares for, this could have an adverse effect on the company's ability to sell any shares resulting in limited or no capital being raised for the business plan. OUR COMPETITORS, SUCH AS KORITE, STONESBONES.COM, AMMOLITE-GUARANTEED.COM AND AMMOLITES.COM, HAVE BEEN IN BUSINESS LONGER THEN WE HAVE AND HAVE SUBSTANTIALLY GREATER RESOURCES THAN WE DO. SHOULD WE BE UNABLE TO ACHIEVE ENOUGH MARKET SHARE IN OUR INDUSTRY, WE MAY EXPERIENCE LOWER LEVELS OF REVENUE THAN OUR BUSINESS PLAN ANTICIPATES. In our development stage, we will have size and market share disadvantages as we attempt to implement our marketing plan. We plan to market our product via the Internet and Home Shopping Network. Without sufficient sales volume, it is possible that we may not become a competitive force in our industry. THERE IS NO CURRENT PUBLIC MARKET FOR OUR SECURITIES. AS OUR STOCK IS NOT PUBLICLY TRADED, INVESTORS SHOULD BE AWARE THEY PROBABLY WILL BE UNABLE TO SELL THEIR SHARES AND THEIR INVESTMENT IN OUR SECURITIES IS NOT LIQUID. We are not registered on any public stock exchange, however, we plan to contact a market maker to obtain a listing for quotation on the OTC Electronic Bulletin Board. We do not know when we will be able to contact a market maker to obtain a quote for trading, and there is no guarantee of trading volume or trading price levels sufficient for investors to sell their stock, recover their investment in our stock, or profit from the sale of their stock. OUR SOLE DIRECTOR/OFFICER BENEFICIALLY OWNS 95% OF THE OUTSTANDING SHARES OF OUR COMMON STOCK. AFTER THE PROPOSED OFFERING HE WILL OWN 87% OF THE OUTSTANDING SHARES. IF HE CHOOSES TO SELL HIS SHARES IN THE FUTURE, IT MIGHT HAVE AN ADVERSE EFFECT ON THE PRICE OF OUR STOCK. Due to the controlling amount of his share ownership in our company, if our sole director/officer decides to sell his shares in the public market, the market price of our stock could decrease and all shareholders suffer a dilution of the value of their stock. If our director/officer decides to sell any of his common stock, he will be subject to Rule 144 under the 1933 Securities Act. 5 OUR SOLE DIRECTOR/OFFICER BENEFICIALLY OWNS 95% OF THE OUTSTANDING SHARES OF OUR COMMON STOCK. AFTER THE PROPOSED OFFERING HE WILL OWN 87% OF THE OUTSTANDING SHARES. HE WILL CONTROL AND MAKE CORPORATE DECISIONS THAT MAY DIFFER FROM THOSE THAT MIGHT BE MADE BY THE OTHER SHAREHOLDERS. Due to the controlling amount of his share ownership in our company, our sole director/officer will have a significant influence in determining the outcome of all corporate transactions, including the power to prevent or cause a change in control. His interests may differ from the interests of the other stockholders and thus result in corporate decisions that are disadvantageous to other shareholders. THE CURRENT OFFICER, LAWRENCE JEAN, THE SOLE OFFICER AND DIRECTOR OF THE COMPANY, CURRENTLY DEVOTES APPROXIMATELY 30 HOURS PER WEEK TO COMPANY MATTERS, AND AT THE SAME TIME, HE IS INVOLVED IN OTHER BUSINESS ACTIVITIES. AMMOGEM'S NEEDS FOR HIS TIME AND SERVICES COULD CONFLICT WITH HIS OTHER BUSINESS ACTIVITIES. THIS POSSIBLE CONFLICT OF INTEREST COULD RESULT IN HIS INABILITY TO PROPERLY MANAGE AMMOGEM'S AFFAIRS, RESULTING IN OUR REMAINING A START-UP COMPANY WITH NO REVENUES OR PROFITS. Ammogem has not formally adopted a plan to resolve any potential or actual conflicts of interest that exist or may arise with Mr. Jean's services, however, Mr. Jean has verbally agreed to limit his role in all other business activities and devote full time services to Ammogem after we raise sufficient capital and are able to provide officers' salaries per our business plan. Per our business plan, we have budgeted $1,500 per month for Mr. Jean's salary after we raise funds from our proposed offering. If we are unable to receive our full amount of funding the officers' salary will be adjusted accordingly. OUR MANAGEMENT IS COMMITTED TO USE THE PROCEEDS FROM OUR PROPOSED OFFERING FOR THE BENEFIT OF THE COMPANY AND ADVANCING OUR BUSINESS PLAN, HOWEVER, SUCH USES MAY NOT YIELD A FAVORABLE RETURN. Management has committed to use the proceeds raised in this offering for the uses set forth in the proceeds table. However, certain factors beyond their control, such as increases in certain costs, could result in the company being forced to reduce the proceeds allocated for other uses, such as compensation in order to accommodate these unforeseen changes. The failure of our management to use these funds effectively could result in unfavorable returns. This could have a significant adverse effect on our financial condition and could cause the price of our common stock to decline. FORWARD LOOKING STATEMENTS This prospectus contains forward-looking statements that involve risk and uncertainties. We use words such as "anticipate", "believe", "plan", "expect", "future", "intend", and similar expressions to identify such forward-looking statements. Investors should be aware that all forward-looking statements contained within this filing are good faith estimates of management as of the date of this prospectus. Our actual results could differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us as described in the "Risk Factors" section and elsewhere in this prospectus. 6 USE OF PROCEEDS We will not receive any proceeds from the sale of the common stock offered through this prospectus by the selling shareholders. If we sell all shares of common stock offered by the company in this prospectus, we will receive net proceeds of $145,000. The table below shows how proceeds from this offering would be used during the twelve months after the offering based upon management's business plan estimates. Total shares offered 300,000 Percent of total shares offered 100% Shares sold 300,000 Gross proceeds from offering 150,000 Less: offering expenses 5,000 ------- Net proceeds from offering 145,000 Use of net proceeds: Management Salaries 18,000 Equip & Furniture 6,000 Website 25,000 Marketing 20,000 Travel & Trade Shows 7,000 Packaging & Shipping 5,000 Inventory 50,000 Exploration & Development Costs 7,900 Working Capital 6,100 Office expenses & supplies 60,000 The table below shows how proceeds from this offering would be used for scenarios where we sell various amounts of the shares and the priority of the use of net proceeds in the event actual proceeds are not sufficient to accomplish the uses set forth. These revised estimates are contingent upon reduced funding levels and are based upon management's business plan estimates for the twelve months after receiving funding. Total shares offered 300,000 300,000 Percent of total shares offered 30% 60% Shares sold 90,000 180,000 Gross proceeds from offering 45,000 90,000 Less: offering expenses 5,000 5,000 ------- ------- Net proceeds from offering 30,000 85,000 Use of net proceeds Management Salaries 0 10,800 Equip & Furniture 0 2,000 Website 5,000 15,000 Marketing 5,000 10,000 Travel & Trade Shows 0 3,000 Packaging & Shipping 1,000 5,000 Inventory 10,000 30,000 Exploration & Development 7,900 7,900 Working Capital 1,100 1,300 7 The amounts set forth above are estimates developed by our management for allocation of net proceeds of this offering. These estimates are based upon our current plans and prevailing economic and industry conditions, and assumes that we are able to sell the number of the shares set forth in each column. We have determined the minimum funding required to proceed with a reduced form of our business plan would be $45,000 or 30% of our offering. Although we do not currently contemplate material changes in the proposed use of proceeds set forth above, to the extent that our management finds that adjustments are required, the amounts shown may be adjusted among the uses indicated. Our proposed use of proceeds is subject to changes in general, economic and competitive conditions, timing and management discretion, each of which may change the amount of proceeds expended for the purposes intended, but any changes would be limited to making adjustments among the uses indicated. Changes in general, economic, competitive and market conditions and our financial condition would include, without limitation, the occurrence of a national economic slowdown or recession, a significant change in the industry and the environment in which we operate, and regulatory changes in general. While our management is not currently aware of the existence or pending threat of any of the foregoing reasons, we provide you no assurance that one or more of such events will not occur. DETERMINATION OF OFFERING PRICE The company set the offering price of the common stock at $0.50 per share. The price was arbitrarily set based upon the collective judgment of the company and the shareholders as to a price per share they were willing to accept. All 300,000 shares being registered for sale by the company will be sold at a fixed price per share of $0.50 for the duration of the offering. The 142,600 shares being registered for sale by the selling shareholders will be offered at a fixed price of $0.50 per share until the common stock is quoted on the OTC Bulletin Board and thereafter at prevailing market prices or privately negotiated prices. DILUTION Net tangible book value per share represents the amount of our total tangible assets less total liabilities, divided by the total number of shares of common stock outstanding. Our net tangible book value at June 30, 2005 was 2,764 or $0.001 per share of common stock. Dilution per share represents the difference between the offering price of $0.50 per share and the net tangible book value per share of common stock, as adjusted, immediately after this offering. Prior to the completion of the offering, our net tangible book value was $2,764. After giving effect to a 100% completion of the offering and after deducting offering expenses estimated to be $5,000, our pro forma net tangible book value will be $147,764 or $0.043 per share. This represents an immediate increase in pro forma net tangible book value of $0.042 per share to existing stockholders and an immediate dilution of $0.457 per share, or approximately 91% of the 8 offering price, to investors purchasing shares of common stock in the offering, or should the offering be only 60% or 30% subscribed, the immediate dilution would be respectively 95% and 97%. Public offering Price per share $ 0.50 Net Tangible Book Value per share before offering $ 0.001 Increase Per Share attributable to sale of these shares $ 0.042 Pro-Forma Net Tangible Book Value after offering $ 0.043 Dilution per share to Public Investors $ 0.457 The following table summarizes the number of shares purchased as a percentage of our total outstanding shares, the aggregate amount paid for such shares, the aggregate amount paid figured as a percentage of the total amount paid, and the average amount paid per share for such shares. For purposes of this table, the sale to the public of these shares is assumed to have taken place as of the date of this prospectus. Shares Purchased Total Consideration Paid ----------------- ------------------------ Average Number Percent Amount Percent Per Sh ------ ------- ------ ------- ------ Existing Shareholders 3,142,600 91 $ 14,660 8.9 $0.003 New Investors 300,000 9 $150,000 91.1 $0.50 --------- ---- -------- ----- ------ Total 3,442,600 100 $164,660 100 $0.030 ========= ==== ======== ===== ====== The following table sets forth the estimated net tangible book value ("NTBV") per share after the offering and the dilution to persons purchasing shares based upon various levels of sales of the shares being achieved. Shares outstanding prior to offering 3,142,600 Total shares offered 300,000 300,000 Shares sold 90,000 180,000 Public offering price $ 0.50 $ 0.50 Per share increase attributable to new investors $ 0.012 $ 0.026 NTBV per share prior to offering $ 0.001 $ 0.001 ---------- --------- Post offering pro forma NTBV per share $ 0.013 $ 0.026 Dilution to new investors $ 0.487 $ 0.474 Percent of dilution of the offering price 97% 95% 9 DIVIDEND POLICY We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of the business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. SELLING SECURITY HOLDERS The selling shareholders named in this prospectus are offering 142,600 shares of the common stock offered through this prospectus. The shares were acquired from us in an offering that was exempt from registration pursuant to Regulation S of the Securities Act of 1933, as amended, and completed in January 2005. The following table provides as of the date of this prospectus information regarding the beneficial ownership of our common stock held by each of the selling shareholders, including: 1. The number of shares owned by each prior to this offering; 2. The total number of shares that are to be offered for each; 3. The total number of shares that will be owned by each upon completion of the offering; 4. The percentage owned by each; and 5. The identity of the beneficial holder of any entity that owns the shares. To the best of our knowledge, the named parties in the table that follows are the beneficial owners and have the sole voting and investment power over all shares or rights to the shares reported. The column reporting the percentage owned upon completion assumes that all shares offered are sold, and is calculated based on 3,142,600 shares outstanding as of the date of this prospectus. Shares Total of Total Percent Owned Prior Shares Shares Owned Name of To This Offered After After Selling Shareholder Offering For Sale Offering Offering - ------------------- -------- -------- -------- -------- Rupert Allan 1,000 1,000 0 0 Jim Biniaris 1,000 1,000 0 0 Lena Biniaris 1,000 1,000 0 0 Norman Blair 1,000 1,000 0 0 Sandra Lee Bosch 1,000 1,000 0 0 Ron Bruce 1,000 1,000 0 0 Checkers Investments Wm. A. Manuel, Principal 27,000 27,000 0 0 Andrew Coldicutt 2,000 2,000 0 0 Patti Coldicutt 3,000 3,000 0 0 Heather Conley 1,000 1,000 0 0 Allegra Costigan 1,000 1,000 0 0 Chehalis Jas Costigan 1,000 1,000 0 0 10 John Costigan 1,000 1,000 0 0 Leonard Drake 1,000 1,000 0 0 Maureen Elliott 1,000 1,000 0 0 Jai Farkas 1,000 1,000 0 0 Suya Farkas 1,000 1,000 0 0 Danielle Jean 1,000 1,000 0 0 Lois Jean 1,000 1,000 0 0 Mary Ann Jean 1,000 1,000 0 0 Michelle Jean 1,000 1,000 0 0 Suzanne Jean 1,000 1,000 0 0 Tammy Klashinsky 1,000 1,000 0 0 William Koble 1,000 1,000 0 0 Joanne Kotsiris 2,000 2,000 0 0 John Lepik 1,000 1,000 0 0 Daniel Maarsman Sr 1,000 1,000 0 0 David Milligan 1,000 1,000 0 0 Kerry Milligan 1,000 1,000 0 0 Nancy Morrison 1,000 1,000 0 0 Nick Papadimitriou 1,000 1,000 0 0 Sam Papadimitriou 1,000 1,000 0 0 Georgia Piliotis 1,000 1,000 0 0 Marilyn Schneider 1,000 1,000 0 0 Elaine Stupendick 1,000 1,000 0 0 Swanson Investments, Max Quin, Principal 23,000 23,000 0 0 Tradewinds Investments, Shakira Burrows, Principal 29,800 29,800 0 0 Turbo International, Michael C.E. Turner, Prin. 19,800 19,800 0 0 J. Patricio Varas 1,000 1,000 0 0 Robert Woods 1,000 1,000 0 0 Robert Young 1,000 1,000 0 0 Helen Yuck 1,000 1,000 0 0 Terry Yuck 1,000 1,000 0 0 To our knowledge, none of the selling shareholders: 1. Has had a material relationship with Ammogem or any of its predecessors or affiliates, other than as a shareholder as noted above, at any time within the past three years; or 2. Are broker-dealers or affiliates of broker dealers; or 3. Has ever been an officer or director of Ammogem. 11 PLAN OF DISTRIBUTION Ammogem is bearing all costs relating to the registration of the common stock. While we have no formal agreement to provide funding with our director, he has verbally agreed to advance additional funds in order to complete the registration statement process. There has been no discussion or agreement as to any limitation being placed on the amount of the funds the director will provide, nor any arrangement regarding the company paying back any funds that are advanced. If the company's common shares are quoted for trading on the OTC Electronic Bulletin Board the trading in our shares will be regulated by Securities and Exchange Commission Rule 15g-9 which established the definition of a "penny stock". For the purposes relevant to Ammogem, it is defined as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require: (a) that a broker or dealer approve a person's account for transactions in penny stocks; and (b) the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve a person's account for transactions in penny stocks, the broker or dealer must (a) obtain financial information and investment experience objectives of the person; and (b) make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the broker/dealer relating to the penny stock market, which, in highlight form, (a) sets forth the basis on which the broker or dealer made the suitability determination; and (b) that the broker or dealer received a signed, written agreement from the investor prior to the transaction. Before you trade a penny stock your broker is required to tell you the offer and the bid on the stock, and the compensation the salesperson and the firm receive for the trade. The firm must also mail a monthly statement showing the market value of each penny stock held in your account. SHARES BEING OFFERED BY THE COMPANY We will conduct the sale of the shares we are offering on a self-underwritten basis. This means that we do not have an underwriter and that we will sell the shares directly to investors. All the shares of our common stock that are being registered for sale by the company will be sold at a price per share of $0.50. There can be no assurance that we will sell all or any of the shares offered. We have no arrangements or guarantees that we will sell any shares. All subscription checks shall be made to the order of Ammogem Corp. Our offering will terminate on the earlier of the sale of all of the shares or 180 days after the date of the prospectus. We currently have not determined a plan of how the company will solicit investors interested in purchasing our stock. While we do not anticipate utilizing any registered securities broker-dealers in connection with any sales of the shares and have no arrangements to use any broker-dealers, we may, in our discretion, accept subscriptions for shares through broker-dealers that are members of the National Association of Securities Dealers, Inc. and are willing to, in connection with such sale, pay a 12 commission of up to 10% of the price of each share sold. No officers or directors shall receive any commissions or compensation for their sales of the shares pursuant to the terms hereof. In the event we engage a broker-dealer to distribute our shares, and the broker-dealer is acting as underwriter, we will be required to file a post effective amendment identifying the underwriter, discussing the underwriting agreement and file the agreement as an exhibit to the amended registration statement. SHARES BEING OFFERED BY THE SELLING SHAREHOLDERS The selling shareholders have not informed us of how they plan to sell their shares. However, they may sell some or all of their common stock in one or more transactions: 1. on such public markets or exchanges as the common stock may from time to time be trading; 2. in privately negotiated transactions; or 3. in any combination of these methods of distribution. The sales price to the public has been determined by the company to be $0.50. The price of $0.50 per share is a fixed price until the securities are quoted for trading on the OTC Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144. Under Rule 144, several provisions must be met with respect to the sales of control securities at any time and sales of restricted securities held between one and two years. The following is a summary of the provisions of Rule 144: (a) Rule 144 is available only if the issuer is current in its filings under the Securities an Exchange Act of 1934. Such filings include, but are not limited to, the issuer's quarterly reports and annual reports; (b) Rule 144 allows resale of restricted and control securities after a one year hold period, subjected to certain volume limitations, and resale by non-affiliates holders without limitations after two years; ( c ) The sales of securities made under Rule 144 during any three-month period are limited to the greater of: (i) 1% of the outstanding common stock of the issuer; or (ii) the average weekly reported trading volume in the outstanding common stock reported on all securities exchanges during the four calendar weeks preceding the filing of the required notice of the sale under Rule 144 with the SEC. The selling shareholders may also sell their shares directly through market makers acting in their capacity as broker-dealers. Ammogem will apply to have its shares of common stock quoted on the OTC Bulletin Board immediately after the date of this prospectus. Ammogem anticipates once the shares are quoted on the OTC Bulletin Board the selling shareholders will sell their shares directly into any market created. Selling shareholders will offer their shares at a fixed price of $0.50 per share until the common stock is quoted on the OTC Bulletin Board at which time the prices the selling shareholders will receive will be determined by the market conditions. Selling shareholders may also sell in private transactions. Ammogem cannot predict the price at which shares may be sold or whether the common stock will ever trade on any market. The shares may be sold by the selling shareholders, as the case may be, from time to time, in one or more transactions. Ammogem does not intend to enter into any arrangements with any securities dealers concerning solicitation of offers to purchase the shares. 13 Commissions and discounts paid in connection with the sale of the shares by the selling shareholders will be determined through negotiations between the shareholders and the broker-dealers through or to which the securities are to be sold and may vary, depending on the broker-dealers fee schedule, the size of the transaction and other factors. The separate costs of the selling shareholders will be borne by the shareholder. Any commissions or other fees payable to brokers or dealers in connection with any sale of the common stock will be borne by the selling shareholders or other party selling the common stock. The selling shareholders will, and any broker-broker dealer or agent that participates with the selling shareholders in the sale of the shares by them may be deemed an "underwriter" within the meaning of the Securities Act, and any commissions or discounts received by them and any profits on the resale of shares purchased by them may be deemed to be underwriting commissions under the Securities Act. In the event any selling shareholder engages a broker-dealer to distribute their shares, and the broker-dealer is acting as underwriter, Ammogem will be required to file a post effective amendment containing the name of the underwriter. The selling shareholders must comply with the requirements of the Securities Act of 1933 and the Securities Exchange Act of 1934 in the offer and sale of their common stock. In particular, during times that the selling shareholders may be deemed to be engaged in a distribution of the common stock, and therefore be considered to be an underwriter, they must comply with applicable law. Regulation M prohibits certain market activities by persons selling securities in a distribution. To demonstrate their understanding of those restrictions and others, selling shareholders will be required, prior to the release of un-legended shares to themselves or any transferee, to represent as follows: that they have delivered a copy of this prospectus, and if they are effecting sales on the Electronic Bulletin Board or inter-dealer quotation system or any electronic network, that neither they nor any affiliates or person acting on their behalf, directly or indirectly, has engaged in any short sale of Ammogem common stock; and for a period commencing at least 5 business days before his first sale and ending with the date of his last sale, bid for, purchase, or attempt to induce any person to bid for or purchase Ammogem common stock. We can provide no assurance that all or any of the common stock offered will be sold by the selling shareholders. LEGAL PROCEEDINGS Ammogem is not currently involved in any legal proceedings and we are not aware of any pending or potential legal actions. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS The director and officer of Ammogem, whose one year term will expire on 4/30/06, or at such time as his successor(s) shall be elected and qualified is as follows: 14 Name & Address Age Position Date First Elected Term Expires - -------------- --- -------- ---------- -------------------- Lawrence Jean 58 President, 4/26/04 4/30/06 2316A Willemar Avenue Secretary, Courtenay BC V9N 3M8 Treasurer, Director The foregoing person may be deemed a "promoter" of Ammogem, as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933. Directors are elected to serve until the next annual meeting of stockholders and until their successors have been elected and qualified. Officers are appointed to serve until the meeting of the board of directors following the next annual meeting of stockholders and until their successors have been appointed and qualified. Our director and officer currently handles a minor amount of administrative functions and has been responsible for completing the first phase of our business plan. The officer currently devotes 30 hours per week to the business of the company and intends to work on a full time basis when we raise capital of $145,000, net of offering costs, by January 2006. No executive officer or director of the corporation has been the subject of any order, judgment, or decree of any court of competent jurisdiction, or any regulatory agency permanently or temporarily enjoining, barring, suspending or otherwise limiting him from acting as an investment advisor, underwriter, broker or dealer in the securities industry, or as an affiliated person, director or employee of an investment company, bank, savings and loan association, or insurance company or from engaging in or continuing any conduct or practice in connection with any such activity or in connection with the purchase or sale of any securities. No executive officer or director of the corporation has been convicted in any criminal proceeding (excluding traffic violations) or is the subject of a criminal proceeding which is currently pending. No executive officer or director of the corporation is the subject of any pending legal proceedings. RESUME LAWRENCE HAMILTON JEAN WORK HISTORY Retired 1999 - Current Radar Acquisitions Corp. - Calgary Canada Founder 1995 - 1999 Ammolite Gem Mining company * A Canadian Public company trading under the symbol RAC on the TSXV involved in the mining and processing of Ammolite for jewelry which was marketed internationally. 15 White Gold Ventures - La Rumerosa Mexico Director 1992 - 1995 Mexican Mining company * The company owned and mined a calcium carbonate mine in La Rumerosa, east of Tijuana, Baja California, Mexico. Pathfinder International Recreation Corp - Canada Founder 1986 - 1990 Motor home vacation rental company * Operated 5 locations in Canada and the U.S. serving a global clientele. EDUCATION Graduate 1968 Concordia University, Montreal Canada - Majors in both History and Philosophy Graduate 1971 Simon Fraser University, Vancouver Canada - MBA Program SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth information on the ownership of Ammogem's voting securities by our officer, director and major shareholder as well as those who own beneficially more than five percent of Ammogem's common stock as of the date of this prospectus: Title Of Name & Amount & Percent Class Address Nature of owner Owned ----- ------- --------------- ----- Common Lawrence Jean 3,000,000 (a) 95% 2316A Willemar Avenue Courtenay, BC V9N 3M8 Total Shares Owned or Controlled by the Officer & Director 3,000,000 95% - ---------- (a) Mr. Jean received 1,000,000 shares of the company's common stock on July 7, 2004 for $100. In April 2005 Mr. Jean purchased in private transactions 2,000,000 shares held by two affiliated parties for $200, the price they originally paid for their shares. 16 DESCRIPTION OF SECURITIES Ammogem's Certificate of Incorporation authorizes the issuance of 80,000,000 shares of common stock, .0001 par value per share and 20,000,000 shares of preferred stock, .0001 par value per share. Holders of shares of common stock are entitled to one vote for each share on all matters to be voted on by the stockholders. Holders of shares of common stock are entitled to share ratably in dividends, if any, as may be declared from time to time by the board of directors in its discretion, from funds legally available therefore. In the event of a liquidation, dissolution, or winding up of Ammogem, the holders of shares of common stock are entitled to share pro rata all assets remaining after payment in full of all liabilities. Holders of common stock have no preemptive or other subscription rights, and there are no conversion rights or redemption or sinking fund provisions with respect to such shares. Delaware law does not have any anti-takeover provision that would delay or prevent a change in control. INTEREST OF NAMED EXPERTS AND COUNSEL No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant. Nor was any such person connected with the registrant as a promoter, managing or principal underwriter, voting trustee, director, officer or employee. LEGAL MATTERS Karen Batcher, our legal counsel, has provided an opinion on the validity of our common stock. SECURITIES ACT INDEMNIFICATION DISCLOSURE The Articles and By-Laws of Ammogem have no specific provisions to allow for the indemnification of the officer and director in regard to his carrying out the duties of his offices. Indemnification of directors and officers is as provided by the General Corporate Law of the State of Delaware. We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act is against public policy as expressed in the Securities Act, and is, therefore unenforceable. In the event that a claim for indemnification against such liabilities is asserted by our director, officer, or other controlling person in connection with the securities registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the court's decision. 17 ORGANIZATION IN THE LAST FIVE YEARS Ammogem Corp. was incorporated in Delaware on December 7, 2000 as All Asia Imports, Inc. On April 26, 2004 the company filed an amended Certificate of Incorporation to change the name to Ammogem Corp. The company was incorporated by its resident agent and had no operations from the time of its original formation in December 2000 until Mr. Jean was elected and began initial operations in pursuit of the company's current business plan goals. In July of 2004 Mr. Jean, acting as the sole officer and director, voted to seek capital and began development of our business plan. We received our initial funding of $14,660 through the sale of 142,600 common stock shares to 43 non-affiliated private investors from July 2004 until January 2005, and 3,000,000 shares to our director and president Lawrence Jean and two affiliated parties. Subsequent to that sale Mr. Jean purchased in private transactions the 2,000,000 shares held by the affiliated parties, resulting in Mr. Jean now holding 3,000,000 shares. DESCRIPTION OF BUSINESS GENERAL INFORMATION Ammogem Corp. was incorporated in Delaware on December 7, 2000 as All Asia Imports, Inc. On April 26, 2004 the company filed an amended Certificate of Incorporation to change the name to Ammogem Corp. The company was incorporated by its resident agent and had no operations from the time of its original formation in December 2000 until Mr. Jean was elected and began initial operations in pursuit of the company's current business plan goals. In July of 2004 Mr. Jean, acting as sole officer and director, voted to seek capital and began development of our business plan. We have taken the following steps: developed our business plan, secured the URL www.ammogem.com, and initiated our website. Our web site is currently in its development stage. The features are limited to the logo, a brief description of the gemstone and a contact e-mail. We are a development stage company with no revenues or profits. There has been no bankruptcy, receivership or similar proceedings. There have been no material reclassifications, mergers, consolidations, or purchase or sale of a significant amount of assets not in the ordinary course of business. INDUSTRY HISTORY Ammolite is a rare and valuable opal-like organic gemstone that comes from the fossilized shells of Ammonites, extinct mollusks of the class Cephalopoda, a predecessor to the squid and the South Pacific nautilus. Their history begins more than 65 million years ago when the continents were evolving into the shapes we are familiar with today. During this time the interior of North America was partially submerged under the Bearpaw Sea which bordered the developing Rocky Mountains. The Ammonite had coiled shells with gas-filled chambers that provided buoyancy and propulsion. They were a favored meal of marine reptiles which would extract the squid and discard the empty shell which then sank to the sea floor to be buried in the mineral-rich sediment. During the fossilization process the 18 sediment not only preserved the shell but also enhanced the shell's colors into iridescent greens, yellows, reds and rare blues and violets. It is one of three biogenic gemstones, the other two being pearl and amber. To date marketable ammolite has only been found in, and commercially exploited from, the Bearpaw Formation of southern Alberta, Canada. Outcrops of the Bearpaw Formation are recognized in the Canadian provinces of Alberta and Saskatchewan, and in the U.S. state of Montana. In 1981, ammolite was given official gemstone status by the World Jewelry Confederation, the same year commercial mining of the ammolite began. In 1998, ammolite was declared to be a mineral rather than a fossil under Alberta Law, removing any possible mining restrictions that may have been imposed if it had been declared a fossil. PRINCIPAL PRODUCTS OR SERVICES AND THEIR MARKETS Ammogem Corp. intends to market and sell a variety of Ammonite gemstone products including complete fossil pieces, jewelry, do-it-yourself polishing kits and Feng Shui healing stones. We plan to utilize our website www.ammogem.com, trade shows, as well as eBay and the Home Shopping Network (HSN), to market our products. Management has experience in the mining industry, but has no specific experience in the retailing of ammolite products. Each ammolite gemstone is unique in brilliance, color and pattern. The rarest and most desirable show three or more colors. The iridescent opal-like play of color is due to its microstructure and, unlike other gems whose colors come from light refraction, the iridescent color of ammolite comes from interference with the light that rebounds from the stacked layers of thin platelets that make up the ammolite. The thicker the layers, the more reds and greens are produced, the thinner the layers, the more blues and violets predominate. Reds and greens are the most commonly seen colors, owing to the fragility of the finer layers responsible for the blues. The grading of the stone (AA, A+, A and A- from highest to lowest) is based upon the following considerations: Color Range - A large array of color is displayed in ammolite, including all the spectral colors found in nature. Red and green are far more common than blue or purple. There are also certain hues, like crimson, violet or gold, which are derived from a combination of the primary colors, that are the rarest and in high demand. The most valuable grades have roughly equal portions of three or more primary colors or 1-2 bright and even colors, with the lowest grades having one comparatively dull color predominant. Directional - Chromatic shift is how the colors vary with the angle of viewing and the angle of light striking the gemstone. In higher grades this variation is almost prismatic in its scope, while lower grades show very little variation. Rotational range is how far the specimen can be turned while maintaining its play of color. The best rotate 360 degrees uncompromised, while lesser stones may exhibit directional colors that are only visible within a narrow rotational range, down to 90 degrees or less. Reflective Intensity - The brightness of colors and their iridescence is essentially dependent on how well-preserved the shell is and how fine and orderly the layers are. The quality of polish is also a factor. The most prized ammolite is the sheet type which has broad, uninterrupted swathes of color. 19 The ammolite itself is actually a very thin sheet, 0.02 to 0.03 inches in thickness. Rarely is ammolite without its matrix, which is typically a grey to brown shale. When exposed to the elements the thin ammolite tends to crack and flake. Occasionally a complete ammonite shell (fossil) is recovered with its structure well-preserved. While these shells may be as large as 35.5 inches in diameter, the iridescent ammonites are typically much smaller. Rough ammolite that is durable and thick enough to be used is processed as follows: cut, trimmed, stabilized if necessary, ground to optimum colors, polished and shaped. Because the ammolite layer is very thin most gems are composite stones; these usually take the form of two-part doublets, with the ammolite layer adhered with epoxy to a dark backing material usually the matrix or mother rock from which the ammolite was quarried, or black onyx or glass may also be used. In composites where the ammolite layer is exceptionally thin, a third component is used; this constitutes a triplet, with a durable and transparent convex "cap". This cap is usually either synthetic quartz or spinel, or in lower-end productions, glass. Two types of solids are also produced: two-sided (ammolite on both sides) and one-sided (a natural assemblage of ammolite attached to its shale backing). Ammolite is often damaged by cracking and flaking due to environmental exposure. The thin, delicate sheets in which ammolite occurs are also problematic. For these reasons most material is impregnated with a clear epoxy or other synthetic resin to stabilize it during cutting. Although any cracking present cannot be repaired, the epoxy prevents further flaking and helps protect the soft surface from scratching. The four specific ammolite gemstone markets we intend to target are: Jewelry - Ammolite is used in all forms of jewelry. It is generally fashioned into freeform cabochons (convex shaped, polished but not faceted) and mounted in gold with diamond accents. Because it is soft and will scratch easily, it is best suited for brooches, pendants or earrings. If used as a ring stone, ammolite should be given a hard protective cap, namely one of synthetic spinel as used in triplets. Complete Fossils - Intact ammonite fossils from the Bearpaw formation are rare. There are currently waiting lists for the finer specimens which measure approximately 22" - 25" and weigh 50 lbs. Healing Stones - The Blackfeet Indian tribe knows ammolite as iniskim and have long believed it to possess healing powers and incorporate the gem into their medicine bundles for use in ceremonies. In the late 1990's practitioners of Feng Shui, the Ancient Chinese practice of configuring home or work environments to increase the flow of "chi" or vital energy to promote health, happiness, and prosperity, began to promote ammolite as an "influential" stone with what they believe is the power to enhance well-being and detoxify the body. Named the "Seven Color Prosperity Stone" each color is believed by Feng Shui practitioners to influence in different and positive ways; a combination of ruby red, emerald green and amber yellow is most sought after for this purpose, the colors being said to enhance growth, wisdom and wealth respectively. 20 Lapidary Polishing Kits - For those who wish to polish their own ammolite pieces. Each kit contains a rough ammolite stone, complete set of polishing abrasives (grit kit), jewelry findings and booklet A GUIDE FOR AMMOGEM POLISHERS. We intend to raise $145,000, net of offering costs, by January 2006 to continue executing our business plan. We have determined we need to raise funds by that date in order to meet our twelve month budget. If we are unsuccessful at securing funding by January of 2006, the company intends to adjust its time line forward for delivering its products until funding is secured. There is no assurance that the company will be able to raise $145,000 in our offering. Although other ammolite dealers exist we believe we will be a strong competitor. We plan to achieve all of our business plan goals, however, there is no guarantee we will be successful in implementing our business plan. We have a budget of $145,000 to continue implementing our business plan. We plan to raise $145,000 by January 2006, net of $5,000 offering costs, in order to meet our overall business plan goals. If we receive partial funding we would continue in a reduced capacity by possibly modifying our business plan and achieving our goals at a slower pace while we seek additional funding sources. Although Ammogem intends to implement its business plan through the foreseeable future and will do its best to mitigate the risks associated with its business plan, there can be no assurance that such efforts will be successful. If we are incapable of executing our business plan we would then investigate reasonable business options available to retain value for our shareholders. We could continue making progress on our business plan by developing alternatives such as limiting the scope of the products we offer clients to reduce costs, adjusting or reducing our in-house marketing costs, or reducing the costs for the development of our web site, and adjusting our timeline for the delivery of our products. If only partial funding is received we intend to follow our twelve month time frame, but in a reduced capacity. The level or reduction of our business operations could be commensurate with any given level of funding. We could decrease the number of products we offer, reduce in-house marketing efforts, and adjust our general overhead to any partial funding conditions. We could reduce or eliminate salaries or postpone asset purchases. In a partial funding scenario we would seek to expand our website design and begin our marketing efforts while seeking to eliminate other costs. DISTRIBUTION METHODS OF PRODUCTS OR SERVICES Ammogem plans to market and sell its Ammolite products at its own proposed website, via eBay and Home Shopping Network and at Gem and Lapidary trade shows. STATUS OF ANY PUBLICLY ANNOUNCED NEW PRODUCTS OR SERVICES Ammogem has no new product or service planned or announced to the public. 21 COMPETITION AND COMPETITIVE POSITION Ammogem's competitors for our targeted market have longer operating histories, larger customer bases, and greater brand recognition than Ammogem. Major competitors are ammolites.com, canadafossils.com, ammolite-guaranteed.com, and darlin-jewellers.com. We are not aware of any significant barriers to Ammogem's entry into the Ammolite industry, however, we currently have no sales or share of this market. SUPPLIERS AND SOURCES OF RAW MATERIALS On July 15, 2004 we signed an exclusive license agreement with Ammogem Canada to supply us with our inventory of Ammolite products. A copy of the license agreement is included as Exhibit 10 to this prospectus. DEPENDENCE ON ONE OR A FEW MAJOR CUSTOMERS We will not depend on any one or a few major customers. PATENTS, TRADEMARKS, FRANCHISES, CONCESSIONS, ROYALTY AGREEMENTS, OR LABOR CONTRACTS As of the date of this filing, we have secured our Internet domain name www.ammogem.com. We currently have no plans for trademark protection of our name or products, however, management will assess the need for such on an ongoing basis. On July 15, 2004 the Company entered into an Exclusive License Agreement with Ammogem Minerals Canada, Ltd. In order to keep the license in good standing and if force and effect, we were obligated to pay $5,000 by October 31, 2004 (paid in October 2004) and reimburse Ammogem Canada for exploration and development costs of up to $10,000, of which we have paid $2,100 to date. We are also obligated under the terms of the license agreement to pay Ammogem Canada 40% of the gross revenues in exchange for the acquisition of the minerals, processing and providing inventory on consignment for sale by us. Mr. Lawrence Jean, our officer and director, owns Ammogem Minerals Canada, Ltd. NEED FOR GOVERNMENT APPROVAL FOR ITS PRODUCTS OR SERVICES Ammogem is not required to apply for or have any government approval for its products or services. EFFECT OF GOVERNMENTAL REGULATIONS ON THE COMPANY'S BUSINESS We will be subject to federal laws and regulations that relate directly or indirectly to our operations including securities laws. We will also be subject to common business and tax rules and regulations pertaining to the operation of our business in Canada and the United States. These would include a business licenses as well as obtaining a Canadian federal tax number to collect the 22 federal Goods and Services Tax (GST) on all sales made within Canada. The only trade rules that could apply to our business would be duties and taxes. Any products that are produced or manufactured in the U.S., Canada or Mexico would fall under the North American Free Trade Agreement (NAFTA) and would be duty free providing they are accompanied by a certificate of origin. We are also aware that as the Internet becomes increasingly popular, it is possible that a number of laws and regulations may be adopted with respect to the Internet. These laws may cover issues such as user privacy, freedom of expression, pricing, content and quality of products and services, taxation, advertising, intellectual property rights and security of information. Furthermore, the growth of electronic commerce may prompt demand for more stringent consumer protection laws. Several U.S. states have proposed legislation to limit the uses of personal user information gathered online or require online services to establish privacy policies. The Federal Trade Commission has also initiated action against at least one online service regarding the manner in which personal information is collected from users and provided to third parties and has proposed regulations restricting the collection and use of information from minors online. We do not currently have plans to provide personal data regarding our customers to any third parties and currently do not plan to identify registered users by age. However, the adoption of additional privacy or consumer protection laws could create uncertainty in usage of the Internet and reduce the demand for our products or require us to redesign our web site. We are uncertain as to how our business could be impacted by the application of existing laws governing issues such as property ownership, copyrights, encryption and other intellectual property issues, taxation, libel, obscenity, qualification to do business and personal privacy. The vast majority of these laws were adopted prior to the advent of the Internet. As a result, they do not contemplate or address the unique issues of the Internet and related technologies. Changes in laws intended to address these issues could create uncertainty in the Internet marketplace. This uncertainty could reduce demand for our products through our proposed internet sales, increase the cost of doing business as a result of litigation costs and/or increase product delivery costs. RESEARCH AND DEVELOPMENT COSTS DURING THE LAST TWO YEARS Ammogem has expended no funds for research and development costs since inception. COSTS AND EFFECTS OF COMPLIANCE WITH ENVIRONMENTAL LAWS Ammogem is not aware of any environmental regulations that could directly affect its operations, but no assurance can be given that environmental regulations will not, in the future, have a material adverse impact on our business. NUMBER OF EMPLOYEES Ammogem's only current employee is its officer who devotes 30 hours per week to manage the affairs of the company. The officer intends to work on a full time basis when Ammogem raises capital per its business plan. Our business plan does not call for hiring any new full-time employees during the next twelve months, however if revenues are sufficient to cover the expense management will evaluate the need for any more employees. 23 REPORTS TO SECURITIES HOLDERS We will provide an annual report to our shareholders including audited financial statements pursuant to Item 101c of Regulation S-B. We will make our financial information equally available to any interested parties or investors through compliance with the disclosure rules of Regulation S-B for a small business issuer under the Securities Exchange Act of 1934. Ammogem will become subject to disclosure filing requirements upon the effective date of this prospectus, including filing Form 10-KSB annually and Form 10-QSB quarterly. In addition, we will file Form 8-K and other proxy and information statements from time to time as required. We do not intend to voluntarily file the above reports in the event our obligation to file such reports is suspended under the Exchange Act. The public will be able to read and copy any materials that we file with the Securities and Exchange Commission, ("SEC"), at the SEC's Public Reference Room at 450 Fifth Street NW, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. PLAN OF OPERATION Ammogem's current cash balance is $5,664. Our director has agreed to provide additional funding that will enable us to maintain a positive cash flow needed to pay for our current level of operating expenses over the next twelve months, which would include office expenses, bookkeeping and audit fees and website costs. There are no formal commitments or arrangements with our director to advance or loan funds to Ammogem. There are no terms regarding repayment of any loan or capital contribution. If we experience a shortage of funds for our registration costs prior to funding, our director has also informally agreed to advance funds to allow us to pay for offering costs, filing fees, and correspondence with our shareholders. In order to achieve our business plan goals, we will need to raise capital through the sale of equity securities. We are a development stage company and have generated no revenue to date. We have sold $14,660 in equity securities to pay for our operations to date. We estimate our current cash balance of $5,664 will be sufficient for office expenses and fees through January 2006, our director has agreed to provide additional funding over the next twelve months or until we are able to receive funding per our business plan. Our independent auditors have expressed an opinion that our operating losses since inception raise substantial doubt as to our ability to continue as a going concern. We are dependent upon our ability to raise the additional funding needed to complete our business plan goals over the next twelve months. As of the date of this filing, we have taken the following steps: developed our business plan, secured the Internet domain name www.ammogem.com, and initiated our website. We are now in the process of registering with the Securities and Exchange Commission the securities we sold in July 2004 through January 2005 and an additional 300,000 shares for sale by the Company. We have a budget of $145,000 to continue implementing our business plan. We plan to raise $145,000 24 by January 2006, net of $5,000 offering costs, in order to meet our overall business plan goals. If we are unsuccessful at securing funding by January of 2006, the company intends to adjust its time line forward for delivering its products until funding is secured. Upon securing funding by January of 2006, our plan for delivering our products is as follows: FEBRUARY/MARCH 2006 We will start purchasing the necessary equipment and office furniture for the business, such as a computer, shipping/labeling machine, and inventory shelving and racking, the estimated one-time cost for these is $6,000. Hire a website designer to expand the preliminary website at www.ammogem.com as well as provide search engine optimization for our website domain (estimated one time cost of $20,000). We will start placing orders for our initial inventory to be delivered within thirty to sixty days. We will set aside approximately $25,000 to $30,000 to cover the 40% of retail sales which will be owed to Ammogem Canada upon the sale of this inventory. Lawrence Jean will be responsible for these duties and we will begin paying him a management salary of $1,500. APRIL 2006 We plan to attend and display our products at the B.C. Gem Show in Abbotsford, BC March 31st - April 2nd. The rental of a 10' x 10' booth is $1,250. Lawrence Jean will be responsible for setting up and manning the booth. We estimate the total cost of attending this trade show to be $3,000. We anticipate setting aside $10,000 for the 40% of retail sales owed to Ammogem for the inventory we will display and sell at the trade shows we will be attending in April and May. MAY/JUNE 2006 We begin taking delivery of our initial inventory and will concurrently order packaging/shipping supplies. We estimate our initial order for packaging/shipping materials will be for 2,000 units at an estimated cost of $.50 per unit. Website maintenance is estimated to continue at $500 per month. Lawrence Jean will be responsible for these duties. We plan to attend and display our products at the Whole Bead Show in Vancouver, BC May 5th - 7th. The rental of an 8.5' x 6' booth is $1,020. Lawrence Jean will be responsible for setting up and manning the booth. We estimate the total cost of attending the trade show to be $4,000. JULY/AUGUST 2006 Begin advertising campaign in gemstone and lapidary publications such as Canadian Rockhound Magazine and other lapidary publications, and online at sites such as HSN and eBay. We estimate the initial setup of our marketing campaign to cost $4,000 and continue at a monthly rate of $2,000. Lawrence Jean will be responsible for these duties. 25 SEPTEMBER/OCTOBER 2006 We will continue our marketing efforts, focusing on HSN and Ebay as well as follow up interest generated from the trade shows. We estimate spending an additional $10,000 for inventory payments to Ammogem Canada. We also anticipate paying the remaining exploration and development costs of $7,900 to Ammogem Canada during this time. NOVEMBER/DECEMBER 2006 We will continue our marketing efforts, focusing on gift sales for the Christmas season. JANUARY 2007 We anticipate our sales will have reached a level that will sustain our business operations and allow us to begin hiring employees as necessary. In order to meet all of our current business plan goals, we need to receive funding. We intend to use funding we receive to provide cash for our business plan during the next twelve months as cash flow from sales is not estimated to reach a level to sustain our business operations until January 2007. We will face considerable risk in each of our business plan steps, such as difficulty obtaining inventory for sale, longer than anticipated lead time necessary for us to complete our marketing plan, and a shortfall of funding due to our inability to raise capital. If no funding is received during the next twelve months, we may utilize one or more options such as use existing cash in the bank, funds loaned by our director, or we might ask our shareholders for funds. Neither our director nor our shareholders have any formal commitments, arrangements or legal obligation to advance or loan funds to Ammogem. To date, there have been no loans by the director to Ammogem, no negotiated material terms or agreed upon amounts, and no formalized agreements of any kind. Should we receive only partial funding we intend to follow our twelve month time frame, but in a reduced capacity. We could modify our business plan to implement our plan over a longer timetable or reduce the scope of services offered. The level or reduction of our business operations could be commensurate with any given level of funding. We could decrease the number of products we offer, reduce in-house marketing efforts, or adjust our general overhead to any partial funding conditions. We could reduce or eliminate salaries, postpone inventory purchases, and reduce the number or type of products offered. In a partial funding scenario we would seek to expand our website design and begin our marketing efforts while seeking to eliminate other costs. DESCRIPTION OF PROPERTY Ammogem's principal executive office address is 2316A Willemar Avenue, Courtenay BC, Canada V9N 3M8. The principal executive office and telephone number are provided by the officer of the corporation. We consider our current principal office space arrangement adequate until such time as we achieve our business plan goal of raising capital of $150,000 and then begin hiring new employees per 26 our business plan. When our revenues reach a point to sustain operations, we plan to rent approximately 1,000 square feet of warehouse and office space in Courtenay BC. We are aware of available space that would fit our needs, but at this time we have not entered into any lease arrangements for the space. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The principal executive office and telephone number are provided by Mr. Jean, the officer of the corporation. The costs associated with the use of the telephone and mailing address were deemed to be immaterial as the telephone and mailing address were almost exclusively used by him for other business purposes. On July 7, 2004, the Company issued 1,000,000 shares of its $0.0001 par value common stock to Mr. Jean, the officer and director of the Company in exchange for cash in the amount of $100. In April 2005 Mr. Jean purchased in private transactions 2,000,000 shares held by two shareholders for cash in the amount of $200, the amount the shareholders originally paid for their shares. On July 15, 2004 the Company entered into an Exclusive License Agreement with Ammogem Minerals Canada, Ltd. In order to keep the license in good standing and if force and effect, we were obligated to pay $5,000 by October 31, 2004 (paid in October 2004) and reimburse Ammogem Canada for exploration and development costs of up to $10,000, of which we have paid $2,100 to date. We are also obligated under the terms of the license agreement to pay Ammogem Canada 40% of the gross revenues in exchange for the acquisition of the minerals, processing and providing inventory on consignment for sale by us. Mr. Lawrence Jean, our officer and director, owns Ammogem Minerals Canada, Ltd. Mr. Jean, our sole officer and director, is the only "promoter" of Ammogem, as that term is defined in the rules and regulations promulgated under the Securities and Exchange Act of 1933. MARKET FOR COMMON EQUITY AND OTHER SHAREHOLDER MATTERS Ammogem plans to contact a market maker to obtain a listing for trading on the OTC Electronic Bulletin Board. The OTC Electronic Bulletin Board is a network of security dealers who buy and sell stock. The dealers are connected by a computer network which provides information on current "bids" and "asks" as well as volume information. As of the date of this filing, there is no public market for our securities. There has been no public trading of our securities, and, therefore, no high and low bid pricing. As of the date of this prospectus, Ammogem had 44 shareholders of record. We have paid no cash dividends and have no outstanding options. As of the date of this filing, there have been no discussions or understandings between Ammogem nor anyone acting on our behalf with any market maker regarding participation in a future trading market for our securities. Pursuant to this registration statement the company is seeking to register 142,600 shares held by 43 non-affiliated shareholders and 300,000 shares offered by the company. 3,000,000 shares held by our officer and director, are not being registered pursuant to this filing. 27 EXECUTIVE COMPENSATION Ammogem's current officer receives no compensation. The only current Director is Mr. Lawrence Jean. Summary Compensation Table
Other Name & Annual Restricted All Other Principal Compen- Stock Options LTIP Compen- Position Year Salary($) Bonus($) sation($) Award(s)($) SARs(#) Payouts($) sation($) - -------- ---- --------- -------- --------- ----------- ------- ---------- --------- L Jean 2004 -0- -0- -0- -0- -0- -0- -0- President
There are no current employment agreements between the company and its executive officer nor understandings regarding future compensation. The director and principal officer has agreed to work with no remuneration until such time as the company receives sufficient revenues necessary to provide proper salaries. The officer and director has the responsibility to determine the timing of remuneration for key personnel. Per our business plan, if we are successful in raising funds from our proposed offering, we have verbally agreed to pay our officer a $1,500 per month salary. FINANCIAL STATEMENTS The audited financial statements of Ammogem as of December 31, 2004 and December 31, 2003, and from December 7, 2000 (inception) through June 30, 2005 and related notes which are included in this offering have been examined by Oscar Ibarra, and have been so included in reliance upon the opinion of such accountants given upon their authority as an expert in auditing and accounting. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. 28 ARMANDO C. IBARRA Certified Public Accountants A Professional Corporation Armando C. Ibarra, C.P.A. Members of the California Society of Certified Public Accountants Armando Ibarra, Jr., C.P.A., JD Members of the of American Institute of Certified Public Accountants Registered with the Public Company Accounting Oversight Board INDEPENDENT ACCOUNTANTS' REPORT To the Board of Directors of Ammogem Corp. We have reviewed the accompanying balance sheets of Ammogem Corp. as of June 30, 2005, and the related statements of operations, changes in stockholders' equity, and cash flows for the six and three months ended June 30, 2005 and 2004, and for the period of December 7, 2000 (inception) through June 30, 2005 in accordance with Statements on Standards for Accounting Review Services issued by the American Institute of Certified Public Accountants. All information included in these financial statements is the representation of management. We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Our review was made for the purpose of expressing limited assurance that there are no material modifications that should be made to the financial statements in order for them to be in conformity with U.S. generally accepted accounting principles. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company is currently in the development stage. Because of the Company's current status and limited operations there is substantial doubt about its ability to continue as a going concern. Management's plans in regard to its current status are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. /s/ Armando C. Ibarra, CPA-APC - ----------------------------------- Armando C. Ibarra, CPA-APC August 16, 2005 Chula Vista, California 371 E. Street Chula Vista, Ca. 91910 tel: (619) 422-1348 fax: (619) 422-1465 F-1 AMMOGEM CORP. (A Development Stage Company) Balance Sheets - --------------------------------------------------------------------------------
As of As of June 30, December 31, 2005 2004 -------- -------- ASSETS CURRENT ASSETS Cash $ 5,664 $ 6,508 -------- -------- TOTAL CURRENT ASSETS 5,664 6,508 OTHER ASSETS License agreement 5,000 5,000 -------- -------- TOTAL OTHER ASSETS 5,000 5,000 -------- -------- TOTAL ASSETS $ 10,664 $ 11,508 ======== ======== LIABILITIES & STOCKHOLDERS' EQUITY CURRENT LIABILITIES Note payable $ 7,900 $ 7,900 -------- -------- TOTAL CURRENT LIABILITIES 7,900 7,900 -------- -------- TOTAL LIABILITIES 7,900 7,900 STOCKHOLDERS' EQUITY Common stock ($.0001 par value, 20,000,000 shares authorized; 3,142,600 and 3,136,600 shares issued and outstanding as of June 30, 2005 and December 31, 2004, respectively) 315 314 Paid-in capital 14,345 13,646 Deficit accumulated during development stage (11,896) (10,352) -------- -------- TOTAL STOCKHOLDERS' EQUITY 2,764 3,608 -------- -------- TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 10,664 $ 11,508 ======== ========
See Notes to Financial Statements F-2 AMMOGEM CORP. (A Development Stage Company) Statements of Operations - --------------------------------------------------------------------------------
December 7, 2000 Six Months Three Months Three Months Three Months (inception) Ended Ended Ended Ended through June 30, June 30, June 30, June 30, June 30, 2005 2004 2005 2004 2005 ----------- ---------- ----------- ------------ ----------- REVENUES Revenues $ -- $ -- $ -- $ -- $ -- ----------- ---------- ----------- ------------ ----------- TOTAL REVENUES -- -- -- -- -- GENERAL & ADMINISTRATIVE EXPENSES 1,544 -- 296 -- 11,896 ----------- ---------- ----------- ------------ ----------- TOTAL GENERAL & ADMINISTRATIVE EXPENSES 1,544 -- 296 -- 11,896 ----------- ---------- ----------- ------------ ----------- NET LOSS $ (1,544) $ -- $ (296) $ -- $ (11,896) =========== ========== =========== ============ =========== BASIC LOSS PER SHARE $ (0.00) $ -- $ (0.00) $ -- =========== ========== ============ =========== WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 3,141,871 -- 3,142,600 -- =========== ========== ============ ===========
See Notes to Financial Statements F-3 AMMOGEM CORP. (A Development Stage Company) Statement of Changes in Stockholders' Equity From December 7, 2000 (inception) through June 30, 2005 - --------------------------------------------------------------------------------
Deficit Accumulated Common Additional During Common Stock Paid-in Development Stock Amount Capital Stage Total ----- ------ ------- ----- ----- Net lncome, December 7, 2000 (inception) through December 31, 2000 -- -- ---------- -------- ------- -------- ------- BALANCE, DECEMBER 31, 2000 -- -- -- -- -- ---------- -------- ------- -------- ------- Net lncome, December 31, 2001 -- -- ---------- -------- ------- -------- ------- BALANCE, DECEMBER 31, 2001 -- -- -- -- -- ---------- -------- ------- -------- ------- Net lncome, December 31, 2002 -- -- ---------- -------- ------- -------- ------- BALANCE, DECEMBER 31, 2002 -- -- -- -- -- ---------- -------- ------- -------- ------- Net lncome, December 31, 2003 -- -- ---------- -------- ------- -------- ------- BALANCE, DECEMBER 31, 2003 -- -- -- -- -- ---------- -------- ------- -------- ------- Common stock issued for cash on August 5, 2004 3,000,000 300 300 Common stock issued for cash on August 30, 2004 15,000 2 1,498 1,500 Common stock issued for cash on September 21, 2004 80,800 8 8,072 8,080 Common stock issued for cash on October 26, 2004 30,800 3 3,077 3,080 Common stock issued for cash on December 15, 2004 10,000 1 999 1,000 Net loss, December 31, 2004 (10,352) (10,352) ---------- -------- ------- -------- ------- BALANCE, DECEMBER 31, 2004 3,136,600 314 13,646 (10,352) 3,608 ---------- -------- ------- -------- ------- Common stock issued for cash on January 26, 2005 6,000 1 599 600 Contributed capital on April 5, 2005 100 100 Net Loss, June 30, 2005 (1,544) (1,544) ---------- -------- ------- -------- ------- BALANCE, JUNE 30, 2005 3,142,600 $ 315 $14,345 $(11,896) $2,764 ========== ======== ======= ======== =======
See Notes to Financial Statements F-4 AMMOGEM CORP. (A Development Stage Company) Statements of Cash Flows - --------------------------------------------------------------------------------
December 7, 2000 Six Months Six Months Three Months Three Months (inception) Ended Ended Ended Ended through June 30, June 30, June 30, June 30, June 30, 2005 2005 2005 2004 2005 -------- -------- -------- -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $ (1,544) $ -- $ (296) $ -- $(11,896) Changes in operating assets and liabilities: (Increase) decrease in license agreement -- -- -- -- (5,000) -------- -------- -------- -------- -------- NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (1,544) -- (296) -- (16,896) CASH FLOWS FROM INVESTING ACTIVITIES NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES -- -- -- -- -- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issuance of commons stock 600 -- -- -- 14,560 Proceeds in paid in capital 100 100 -- 100 Proceeds from note payable -- -- -- -- 7,900 -------- -------- -------- -------- -------- NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 700 -- 100 -- 22,560 -------- -------- -------- -------- -------- NET INCREASE (DECREASE) IN CASH (844) -- (196) -- 5,664 CASH AT BEGINNING OF PERIOD 6,508 -- 5,860 -- -- -------- -------- -------- -------- -------- CASH AT END OF PERIOD $ 5,664 $ -- $ 5,664 $ -- $ 5,664 ======== ======== ======== ======== ======== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Interest paid $ -- $ -- $ -- $ -- ======== ======== ======== ======== Income taxes paid $ -- $ -- $ -- $ -- ======== ======== ======== ========
See Notes to Financial Statements F-5 AMMOGEM CORP. (A Development Stage Company) Notes to Financial Statements As of June 30, 2005 NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS Ammogem Corp. (the Company) was incorporated under the laws of the State of Delaware on December 7, 2000 under the name All Asia Imports, Inc. On April 26, 2005 the board approved a name change to Ammogem Corp. The Company is in the development stage. Its activities to date have been limited to capital formation, organization, set-up of a website, and development of its business plan and a target customer market. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. BASIS OF ACCOUNTING The Company's financial statements are prepared using the accrual method of accounting. The Company has elected a December 31, year-end. B. BASIC EARNINGS PER SHARE In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share", which specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. SFAS No. 128 supersedes the provisions of APB No. 15, and requires the presentation of basic earnings (loss) per share and diluted earnings (loss) per share. The Company has adopted the provisions of SFAS No. 128 effective December 30, 1999 (inception). Basic net loss per share amounts is computed by dividing the net loss by the weighted average number of common shares outstanding. Diluted earnings per share are the same as basic earnings per share due to the lack of dilutive items in the Company. C. CASH EQUIVALENTS The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. D. INCOME TAXES Income taxes are provided in accordance with Statement of Financial Accounting Standards No. 109 (SFAS 109), Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities. F-6 AMMOGEM CORP. (A Development Stage Company) Notes to Financial Statements As of June 30, 2005 NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. INCOME TAXES (CONTINUED) Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. NOTE 3. WARRANTS AND OPTIONS There are no warrants or options outstanding to acquire any additional shares of common. NOTE 4. GOING CONCERN The accompanying financial statements are presented on a going concern basis. The Company generated net losses of $11,896 during the period from December 7, 2007 (inception) to June 30, 2005. This condition raises substantial doubt about the Company's ability to continue as a going concern. Because the Company is currently in the development stage and has minimal expenses, management believes that the company's current cash of $5,664 is sufficient to cover the expenses they will incur during the next twelve months. Management plans to raise additional funds through debt or equity offerings. Management has yet to decide what type of offering the Company will use or how much capital the Company will attempt to raise. There is no guarantee that the Company will be able to raise any capital through any type of offerings. NOTE 5. RELATED PARTY TRANSACTION The Company neither owns nor leases any real or personal property. A director provides office services without charge. Such costs are immaterial to the financial statements and accordingly, have not been reflected therein. The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities as they become available, such persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts. F-7 AMMOGEM CORP. (A Development Stage Company) Notes to Financial Statements As of June 30, 2005 NOTE 5. RELATED PARTY TRANSACTION - (CONTINUED) On July 15, 2004 the Company entered into an Exclusive License Agreement with Ammogem Minerals Canada, Ltd. In order to keep the license agreement in good standing and in force and effect, Ammogem was obligated to pay $5,000 by October 31, 2004 and obligated to pay 40% of the gross revenues of the licensee. The Company is also obligated to reimburse Ammogem Canada $10,000 for exploration and development costs. An officer of the Corporation owns Ammogem Minerals Canada, Ltd. As of June 30, 2005, the Company owed Ammogem Canada $7,900 toward the exploration and development cost. The $7,900 is recorded as a note payable. No repayment terms have been set. NOTE 6. INCOME TAXES As of June 30, 2005 ------------------- Deferred tax assets: Net operating tax carryforwards $ 1,784 Other 0 ------- Gross deferred tax assets 1,784 Valuation allowance (1,784) ------- Net deferred tax assets $ 0 ======= Realization of deferred tax assets is dependent upon sufficient future taxable income during the period that deductible temporary differences and carryforwards are expected to be available to reduce taxable income. As the achievement of required future taxable income is uncertain, the Company recorded a valuation allowance. NOTE 7. SCHEDULE OF NET OPERATING LOSSES 2000 Net Operating Income $ 0 2001 Net Operating Income 0 2002 Net Operating Income 0 2003 Net Operating Income 0 2004 Net Operating Loss (10,352) 2005 Net Operating Loss (six months) (1,544) -------- Net Operating Loss $(11,896) ======== As of June 30, 2005, the Company has a net operating loss carryforwards of approximately $11,896. The operating loss carryforward expires twenty years from the date the loss was incurred. F-8 AMMOGEM CORP. (A Development Stage Company) Notes to Financial Statements As of June 30, 2005 NOTE 8. STOCK TRANSACTIONS Transactions, other than employees' stock issuance, are in accordance with paragraph 8 of SFAS 123. Thus issuances shall be accounted for based on the fair value of the consideration received. Transactions with employees' stock issuance are in accordance with paragraphs (16-44) of SFAS 123. These issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, or whichever is more readily determinable. On August 5, 2004 the Company issued 3,000,000 shares of common stock for cash valued at $0.001 per share. On August 30, 2004 the Company issued 15,000 shares of common stock for cash valued at $0.10 per share. On September 21, 2004 the Company issued 80,800 shares of common stock for cash valued at $0.10 per share. On October 26, 2004 the Company issued 30,800 shares of common stock for cash valued at $0.10 per share. On December 15, 2004 the Company issued 10,000 shares of common stock for cash valued at $0.10 per share. On January 26, 2005 the Company issued 6,000 shares of common stock for cash valued at $0.10 per share. As of June 30, 2005 the Company had 3,142,600 shares of common stock issued and outstanding. NOTE 9. STOCKHOLDERS' EQUITY The stockholders' equity section of the Company contains the following classes of capital stock as of June 30, 2005: * Common stock, $0.0001 par value: 20,000,000 shares authorized; 3,142,600 shares issued and outstanding. F-9 Dealer Prospectus Delivery Obligation "UNTIL ______________, ALL DEALERS THAT EFFECT TRANSACTIONS IN THESE SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE DEALERS' OBLIGATION TO DELIVER A PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS." PART II INFORMATION NOT REQUIRED IN PROSPECTUS INDEMNIFICATION OF DIRECTORS AND OFFICERS The Articles and By-Laws of Ammogem have no specific provisions to allow for the indemnification of the officer and director in regard to his carrying out the duties of his offices. Indemnification of directors and officers is as provided by the General Corporate Law of the State of Delaware. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The estimated costs of the offering are denoted below. Please note all amounts are estimates other than the Commission's registration fee. Securities and Exchange Commission registration fee $ 28 Accounting fees and expenses $3,000 Legal fees $ 700 Printing and mailing fees $ 372 Transfer Agent fees $ 900 ------ Total $5,000 ====== Ammogem will pay all expenses of the offering listed above. No portion of these expenses will be borne by the selling shareholders. RECENT SALES OF UNREGISTERED SECURITIES On July 7, 2004, the Board of Directors authorized the issuance of 1,000,000 shares of common stock to Mr. Jean for $100 and 2,000,000 shares to two affiliated parties for $200, a price of $0.0001 per share. In issuing the shares, the company relied upon Section 4(2) of Securities Act of 1933, as amended (the "Act"), under Rule 144. The price per share was an arbitrary price set by the board of directors. Subsequent to that sale Mr. Jean purchased in private transactions the 2,000,000 shares held by the affiliated parties, resulting in Mr. Jean now holding 3,000,000 shares. From the period of approximately July 1, 2004 until January 31, 2005, the company offered and sold 142,600 shares at $0.10 per share to 43 non-affiliated private investors. The company relied upon Regulation S, category 3 of Rule 903 of the Securities Act of 1933, as amended (the "Act"). Each prospective investor was given a private placement memorandum designed to disclose all material aspects of an investment in the company, including the business, management, offering details, risk factors and financial statements. Each investor also completed a subscription confirmation letter and private placement subscription agreement whereby the investors certified that they were purchasing the shares for their own accounts, were non U.S. persons, and had adequate and reasonable II-1 opportunity and access to any corporate information necessary to make an informed investment decision, that the securities would be resold in accordance with Regulation S or pursuant to an available exemption. This offering was not accompanied by general advertisement or general solicitation and the shares were issued with a Regulation S restrictive legend. In addition, the Company has adopted in conjunction with the sale of these securities a board resolution to refuse to register or transfer any of the securities not made in accordance with the provisions of Regulation S, pursuant to registration under the Securities Act, or pursuant to an available exemption from registration. Under the Securities Act of 1933, all sales of an issuers' securities or by a shareholder, must either be made (i) pursuant to an effective registration statement filed with the SEC, or (ii) pursuant to an exemption from the registration requirements under the 1933 Act. EXHIBITS Exhibit 3.1 Articles of Incorporation Included Exhibit 3.2 Bylaws Included Exhibit 5 Opinion re: Legality Included Exhibit 10 Licensing Agreement with Ammogem Minerals Canada Included Exhibit 23.1 Consent of legal counsel Included in Exhibit 5 Exhibit 23.2 Consent of independent auditor Included UNDERTAKINGS The undersigned registrant hereby undertakes: 1. To file, during any period in which offers of sales are being made, a post-effective amendment to this registration statement to: i. Include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; ii. Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in this registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low and high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement ; and iii. Include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in the registration statement. II-2 2. That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and that the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. 3. To remove from registration by means of a post-effective amendment any of the securities being registered hereby which remain unsold at the termination of the offering. 4. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to officers, directors, and controlling persons pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities is asserted our director, officer, or other controlling person in connection with the securities registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction. We will then be governed by the final adjudication of such issue. SIGNATURES In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe it meets all of the requirements for filing Form SB-2 and authorized this registration statement to be signed on its behalf by the undersigned, in the City of Courtenay, Province of British Columbia, on September 13, 2005. Ammogem Corp. By /s/ Lawrence Jean ---------------------------- Lawrence Jean (Principal Executive Officer, Principal Accounting Officer) In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated. /s/ Lawrence Jean September 13, 2005 - --------------------------------- ------------------ Lawrence Jean, President Date (Principal Executive Officer, Principal Accounting Officer, Principal Financial Officer) II-3 EX-3.1 2 ex3-1.txt ARTICLES OF INCORPORATION Exhibit 3.1 STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 09:00 AM 12/07/2000 001611623 - 3323581 CERTIFICATE OF INCORPORATION OF ALL ASIA IMPORTS, INC. FIRST: name of this corporation shall be: ALL ASIA IMPORTS, INC. SECOND: The address of its registered office in the State of Delaware is 4406 Tennyson Road, in the City of Wilmington, New Castle County, State of Delaware. The name of its Registered Agent at such address is Delaware Corporate Agents, Inc. THIRD: The nature of the business or purpose to be conducted or promoted is to engage in any lawful act or activity which corporations may be organized under the General Corporation Law of Delaware. FOURTH: The total number of shares of stock which the corporation shall have authority to issue is 80,000,000 shares of common stock with $0.0001 par value and 20,000,000 shares of preferred stock with $0.0001 par value. FIFTH: The name and mailing address of the incorporator is Jane Goldberg, 4406 Tennyson Road, Wilmington, Delaware 19802. SIXTH: The powers of the incorporator(s) shall terminate upon the filing of this Certificate of Incorporation. Following are the name(s) and address(es) of the person(s) who are to serve as director(s) until the first annual meeting of shareholders or until their successors are elected and qualify: Kevin P. Brogan, 2773 Venetia Road, Palm Springs, CA 92262. SEVENTH: The Board of Directors is expressly authorized to make, alter or repeal the By-laws of the corporation EIGHTH: No director shall have personal liability to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided that this Article shall not eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the corporation or its stockholders; (ii) for facts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (iii) under Section 174 of Title 8 of the Delaware Code; (iv) for any transaction from which the director derived on improper personal benefit. NINTH: Elections of directors need not be by written ballot unless the By-Laws of this corporation so provide. I, the undersigned, being the incorporator hereinabove named, for the purpose of forming a corporation pursuant to the General Corporation Law of the State of Delaware, do make this certificate, acknowledging the penalty of perjury, hereby declaring and certifying that this instrument is my act and deed and the facts herein stated are true, pursuant to 8 Del. C 103(b)(2) and accordingly have hereunto set my hand on December 7, 2000. /s/ Jane S. Goldberg -------------------- Jane S. Goldberg STATE OF DELAWARE SECRETARY OF STATE DIVISION OF CORPORATIONS FILED 04:31 PM 4/26/2004 040302293 - 3323581 AMENDMENT TO CERTIFICATE OF INCORPORATION OF ALL ASIA IMPORTS, INC. PURSUANT TO SECTION 242 All Asia Imports, Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware, pursuant to 8 Del. C 242, does hereby certify: FIRST: That at a Special Meeting of the Board of Directors of the said Corporation held on April 23, 2004, the Board of Directors adopted a resolution setting forth the following amendment and declared its advisability and calling a Special Meeting of the Shareholders entitled to vote in respect thereof; RESOLVED, that the Certificate of Incorporation of All Asia Imports, Inc. be amended by striking therefrom Article FIRST and inserting in lieu thereof the following: FIRST: The name of the corporation is AMMOGEM CORP. Pursuant to 8 Del. C 103(b)(2) shareholders holding all of the issued and outstanding stock, and therefore having the minimum number of votes that would be necessary to authorize the amendment to the Certificate of Incorporation if such action were taken at a meeting of the shareholders, have filed their written request with the said Corporation. All Asia Imports, Inc. /s/ Lawrence Hamilton Jean ------------------------------ Lawrence Hamilton Jean Dated: April 26, 2004 EX-3.2 3 ex3-2.txt BYLAWS Exhibit 3.2 BYLAWS OF AMMOGEM CORP. (a Delaware corporation) --------------- ARTICLE I STOCKHOLDERS 1. CERTIFICATES REPRESENTING STOCK. Certificates representing stock in the corporation shall be signed by, or in the name of, the corporation by the Chairperson or Vice-Chairperson of the Board of Directors, if any, or by the President or a Vice-President and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary of the corporation shall sign by, or in the name of, the corporation certificates representing stock in the corporation. Any or all the signatures on any such certificate may be a 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 such officer, transfer agent, or registrar at the date of issue. Whenever the corporation shall be authorized to issue more than one class of stock or more than one series of any class of stock, and whenever the corporation shall issue any shares of its stock as partly paid stock, the certificates representing shares of any such class or series or of any such partly paid stock shall set forth thereon the statements prescribed by the General Corporation Law. Any restrictions on the transfer or registration of transfer of any shares of stock of any class or series shall be noted conspicuously on the certificate representing such shares. The corporation may issue a new certificate of stock or uncertificated shares in place of any certificate theretofore issued by it, alleged to have been lost, stolen, or destroyed, and the Board of Directors may require the owner of the lost, stolen, or destroyed certificate, or such owner's legal representative, to give the corporation a bond sufficient to indemnify the corporation against any claim that may be made against it on account of the alleged loss, theft, or destruction of any such certificate or the issuance of any such new certificate or uncertificated shares. 2. UNCERTIFICATED SHARES. Subject to any conditions imposed by the General Corporation Law, the Board of Directors of the corporation may provide by resolution or resolutions that some or all of any or all classes or series of the stock of the corporation shall be uncertificated shares. Within a reasonable time after the issuance or transfer of any uncertificated shares, the corporation shall send to the registered owner thereof any written notice prescribed by the General Corporation Law. 3. FRACTIONAL SHARE INTERESTS. The corporation may, but shall not be required to, issue fractions of a share. If the corporation does not issue fractions of a share, it shall (1) arrange for the disposition of fractional interests by those entitled thereto, (2) pay in cash the fair value of fractions of a share as of the time when those entitled to receive such fractions are determined, or (3) issue scrip or warrants in registered form (either represented by a certificate or uncertificated) or bearer form (represented by a certificate) which shall entitle the holder to receive a full share upon the surrender of such scrip or warrants aggregating a full share. A certificate for a fractional share or an uncertificated fractional share shall, but scrip or warrants shall not unless otherwise provided therein, entitle the holder to exercise voting rights, to receive dividends thereon, and to participate in any of the assets of the corporation in the event of liquidation. The Board of Directors may cause scrip or warrants to be issued subject to the conditions that they shall become void if not exchanged for certificates representing the full shares or uncertificated full shares before a specified date, or subject to the conditions that the shares for which scrip or warrants are exchangeable may be sold by the corporation and the proceeds thereof distributed to the holders of scrip or warrants, or subject to any other conditions which the Board of Directors may impose. 4. STOCK TRANSFERS. Upon compliance with provisions restricting the transfer or registration of transfer of shares of stock, if any, transfers or registration of transfers of shares of stock of the corporation shall be made only on the stock ledger of the corporation by the registered holder thereof, or by the registered holder's attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the corporation or with a transfer agent or a registrar, if any, and, in the case of shares represented by certificates, on surrender of the certificate or certificates for such shares of stock properly endorsed and the payment of all taxes due thereon. 5. RECORD DATE FOR STOCKHOLDERS. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty nor less than ten days before the date of such a meeting. If no record date is fixed by the Board of Directors, 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 day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. In order that the corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which date shall not be more than ten days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date has been fixed by the Board of Directors, the record date for determining the stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by 2 the General Corporation Law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by the General Corporation Law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action. In order that the corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion, or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto. 6. MEANING OF CERTAIN TERMS. As used herein in respect of the right to notice of a meeting of stockholders or a waiver thereof or to participate or vote thereat or to consent or dissent in writing in lieu of a meeting, as the case may be, the term "share" or "shares" or "share of stock" or "shares of stock" or "stockholder" or "stockholders" refers to an outstanding share or shares of stock and to a holder or holders of record of outstanding shares of stock when the corporation is authorized to issue only one class of shares of stock, and said reference is also intended to include any outstanding share or shares of stock and any holder or holders of record of outstanding shares of stock of any class upon which or upon whom the certificate of incorporation confers such rights where there are two or more classes or series of shares of stock or upon which or upon whom the General Corporation Law confers such rights notwithstanding that the certificate of incorporation may provide for more than one class or series of shares of stock, one or more of which are limited or denied such rights there under; provided, however, that no such right shall vent in the event of an increase or a decrease in the authorized number of shares of stock of any class or series which is otherwise denied voting rights under the provisions of the certificate of incorporation, except as any provision of law may otherwise require. 7. STOCKHOLDER MEETINGS. - TIME. The annual meeting shall be held on the date and at the time fixed, from time to time, by the directors, provided, that the first annual meeting shall be held on a date within thirteen months after the organization of the corporation, and each successive annual meeting shall be held on a date within thirteen months after the date of the preceding annual meeting. A special meeting shall be held on the date and at the time fixed by the directors. 3 - PLACE. Annual meetings and special meetings shall be held at such place, within or without the State of Delaware, as the directors may, from time to time, fix. Whenever the directors shall fail to fix such place, the meeting shall be held at the registered office of the corporation in the State of Delaware. - CALL. Annual meetings and special meetings may be called by the directors or by any officer instructed by the directors to call the meeting. - NOTICE OR WAIVER OF NOTICE. Written notice of all meetings shall be given, stating the place, date, and hour of the meeting and stating the place within the city or other municipality or community at which the list of stockholders of the corporation may be examined. The notice of an annual meeting shall state that the meeting is called for the election of directors and for the transaction of other business which may properly come before the meeting, and shall (if any other action which could be taken at a special meeting is to be taken at such annual meeting) state the purpose or purposes. The notice of a special meeting shall in all instances state the purpose or purposes for which the meeting is called. The notice of any meeting shall also include, or be accompanied by, any additional statements, information, or documents prescribed by the General Corporation Law. Except as otherwise provided by the General Corporation Law, a copy of the notice of any meeting shall be given, personally or by mail, not less than ten days nor more than sixty days before the date of the meeting, unless the lapse of the prescribed period of time shall have been waived, and directed to each stockholder at such stockholder's record address or at such other address which such stockholder may have furnished by request in writing to the Secretary of the corporation. Notice by mail shall be deemed to be given when deposited, with postage thereon prepaid, in the United States mail. If a meeting is adjourned to another time, not more than thirty days hence, and/or to another place, and if an announcement of the adjourned time and/or place is made at the meeting, it shall not be necessary to give notice of the adjourned meeting unless the directors, after adjournment, fix a new record date for the adjourned meeting. Notice need not be given to any stockholder who submits a written waiver of notice signed by such stockholder before or after the time stated therein. Attendance of a stockholder at a meeting of stockholders shall constitute a waiver of notice of such meeting, except when the stockholder attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice. - STOCKHOLDER LIST. The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city or other municipality or community where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting 4 during the whole time thereof, and may be inspected by any stockholder who is present. The stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by this section or the books of the corporation, or to vote at any meeting of stockholders. - CONDUCT OF MEETING. Meetings of the stockholders shall be presided over by one of the following officers in the order of seniority and if present and acting - the Chairperson of the Board, if any, the Vice-Chairperson of the Board, if any, the President, a Vice-President, or, if none of the foregoing is in office and present and acting, by a chairperson to be chosen by the stockholders. The Secretary of the corporation, or in such Secretary's absence, an Assistant Secretary, shall act as secretary of every meeting, but if neither the Secretary nor an Assistant Secretary is present the chairperson of the meeting shall appoint a secretary of the meeting. - PROXY REPRESENTATION. Every stockholder may authorize another person or persons to act for such stockholder by proxy in all matters in which a stockholder is entitled to participate, whether by waiving notice of any meeting, voting or participating at a meeting, or expressing consent or dissent without a meeting. Every proxy must be signed by the stockholder or by such stockholder's attorney-in-fact. No proxy shall be voted or acted upon after three years from its date unless such proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and, if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A proxy may be made irrevocable regardless of whether the interest with which it is coupled is an interest in the stock itself or an interest in the corporation generally. - INSPECTORS. The directors, in advance of any meeting, may, but need not, appoint one or more inspectors of election to act at the meeting or any adjournment thereof. If an inspector or inspectors are not appointed, the person presiding at the meeting may, but need not, appoint one or more inspectors. In case any person who may be appointed as an inspector fails to appear or act, the vacancy may be filled by appointment made by the directors in advance of the meeting or at the meeting by the person presiding thereat. Each inspector, if any, before entering upon the discharge of duties of inspector, shall take and sign an oath faithfully to execute the duties of inspector at such meeting with strict impartiality and according to the best of such inspector's ability. The inspectors, if any, shall determine the number of shares of stock outstanding and the voting power of each, the shares of stock represented at the meeting, the existence of a quorum, the validity and effect of proxies, and shall receive votes, ballots, or consents, hear and determine all challenges and questions arising in connection with the right to vote, count and tabulate all votes, ballots, or consents, determine the result, and do such acts as are proper to conduct the election or vote with fairness to all stockholders. On request of the person presiding at the meeting, the inspector or inspectors, if any, shall make a report in writing of any challenge, question, or matter determined by such inspector or inspectors and execute a certificate of any fact found by such inspector or inspectors. Except as may otherwise be required by subsection (e) of Section 231 of the General Corporation Law, the provisions of that Section shall not apply to the corporation. 5 - QUORUM. The holders of a majority of the outstanding shares of stock shall constitute a quorum at a meeting of stockholders for the transaction of any business. The stockholders present may adjourn the meeting despite the absence of a quorum. - VOTING. Each share of stock shall entitle the holder thereof to one vote. Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. Any other action shall be authorized by a majority of the votes cast except where the General Corporation Law prescribes a different percentage of votes and/or a different exercise of voting power, and except as may otherwise prescribed by the provisions of the certificate of incorporation and these Bylaws. In the election of directors, and for any other action, voting need not be by ballot. 8. STOCKHOLDER ACTION WITHOUT MEETINGS. Except as any provision of the General Corporation Law may otherwise require, any action required by the General Corporation Law to be taken at any annual or special meeting of stockholders, or any action which may be taken at any annual or special meeting of stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock 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. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. Action taken pursuant to this paragraph shall be subject to the provisions of Section 228 of the General Corporation Law. ARTICLE II DIRECTORS 1. FUNCTIONS AND DEFINITION. The business and affairs of the corporation shall be managed by or under the direction of the Board of Directors of the corporation. The Board of Directors shall have the authority to fix the compensation of the members thereof. The use of the phrase "whole board" herein refers to the total number of directors, which the corporation would have if there were no vacancies. 2. QUALIFICATIONS AND NUMBER. A director need not be a stockholder, a citizen of the United States, or a resident of the State of Delaware. The initial Board of Directors shall consist of one (1) person. Thereafter the number of directors constituting the whole board shall be at least one. Subject to the foregoing limitation and except for the first Board of Directors, such number may be fixed from time to time by action of the stockholders or of the directors, or, if the number is not fixed, the number shall be one (1). The number of directors may be increased or decreased by action of the stockholders or of the directors. 6 3. ELECTION AND TERM. The first Board of Directors, unless the members thereof shall nave been named in the certificate of incorporation, shall be elected by the incorporator or incorporators and shall hold office until the first annual meeting of stockholders and until their successors are elected and qualified or until their earlier resignation or removal. Any director may resign at any time upon written notice to the corporation. Thereafter, directors who are elected at an annual meeting of stockholders, and directors who are elected in the interim to fill vacancies and newly created directorships, shall hold office until the next annual meeting of stockholders and until their successors are elected and qualified or until their earlier resignation or removal. Except as the General Corporation Law may otherwise require, in the interim between annual meetings of stockholders or of special meetings of stockholders called for the election of directors and/or for the removal of one or more directors and for the filling of any vacancy in that connection, newly created directorships and any vacancies in the Board of Directors, including unfilled vacancies resulting from the removal of directors for cause or without cause, may be filled by the vote of a majority of the remaining directors then in office, although less than a quorum, or by the sole remaining director. 4. MEETINGS. - TIME. Meetings shall be held at such time as the Board shall fix, except that the first meeting of a newly elected Board shall be held as soon after its election as the directors may conveniently assemble. - PLACE. Meetings shall be held at such place within or without the State of Delaware as shall be fixed by the Board. - CALL. No call shall be required for regular meetings for which the time and place have been fixed. Special meetings may be called by or at the direction of the Chairperson of the Board, if any, the Vice-Chairperson of the Board, if any, of the President, or of a majority of the directors in office. - NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. No notice shall be required for regular meetings for which the time and place have been fixed. Written, oral, or any other mode of notice of the time and place shall be given for special meetings in sufficient time for the convenient assembly of the directors thereat. Notice need not be given to any director or to any member of a committee of directors who submits a written waiver of notice signed by such director or member before or after the time stated therein. Attendance of any such person at a meeting shall constitute a waiver of notice of such meeting, except when such person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the directors need be specified in any written waiver of notice. - QUORUM AND ACTION. A majority of the whole Board shall constitute a quorum except when a vacancy or vacancies prevents such majority, whereupon a majority of the directors in office shall constitute a quorum, provided, that 7 such majority shall constitute at least one-third of the whole Board. A majority of the directors present, whether or not a quorum is present, may adjourn a meeting to another time and place. Except as herein otherwise provided, and except as otherwise provided by the General Corporation Law, the vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board. The quorum and voting provisions herein stated shall not be construed as conflicting with any provisions of the General Corporation Law and these Bylaws which govern a meeting of directors held to fill vacancies and newly created directorships in the Board or action of disinterested directors. Any member or members of the Board of Directors or of any committee designated by the Board may participate in a meeting of the Board, or any such committee, as the case may be, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other. - CHAIRPERSON OF THE MEETING. The Chairperson of the Board, if any and if present and acting, shall preside at all meetings. Otherwise, the Vice-Chairperson of the Board, if any and if present and acting, or the President, if present and acting, or any other director chosen by the Board, shall preside. 5. REMOVAL OF DIRECTORS. Except as may otherwise be provided by the General Corporation Law, any director or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors. 6. COMMITTEES. The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of any member of any such committee or committees, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation with the exception of any power or authority the delegation of which is prohibited by Section 141 of the General Corporation Law, and may authorize the seal of the corporation to be affixed to all papers which may require it. 7. WRITTEN ACTION. Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee. 8 ARTICLE III OFFICERS The officers of the corporation shall consist of a President, a Secretary, a Treasurer, and, if deemed necessary, expedient, or desirable by the Board of Directors, a Chairperson of the Board, a Vice-Chairperson of the Board, an Executive Vice-President, one or more other Vice-Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers with such titles as the resolution of the Board of Directors choosing them shall designate. Except as may otherwise be provided in the resolution of the Board of Directors choosing such officer, no officer other than the Chairperson or Vice-Chairperson of the Board, if any, need be a director. The same person may hold any number of offices, as the directors may determine. Unless otherwise provided in the resolution choosing such officer, each officer shall be chosen for a term which shall continue until the meeting of the Board of Directors following the next annual meeting of stockholders and until such officer's successor shall have been chosen and qualified. All officers of the corporation shall have such authority and perform such duties in the management and operation of the corporation as shall be prescribed in the resolutions of the Board of Directors designating and choosing such officers and prescribing their authority and duties, and shall have such additional authority and duties as are incident to their office except to the extent that such resolutions may be inconsistent therewith. The Secretary or an Assistant Secretary of the corporation shall record all of the proceedings of all meetings and actions in writing of stockholders, directors, and committees of directors, and shall exercise such additional authority and perform such additional duties as the Board shall assign to such Secretary or Assistant Secretary. The Board of Directors may remove any officer, with or without cause. The Board of Directors may fill any vacancy in any office. ARTICLE IV CORPORATE SEAL The corporate seal shall be in such form as the Board of Directors shall prescribe. ARTICLE V FISCAL YEAR The fiscal year of the corporation shall be fixed, and shall be subject to change, by the Board of Directors. 9 ARTICLE VI CONTROL OVER BYLAWS Subject to the provisions of the certificate of incorporation and the provisions of the General Corporation Law, the power to amend, alter, or repeal these Bylaws and to adopt new Bylaws my be exercised by the Board of Directors or by the stockholders. I HEREBY CERTIFY that the foregoing is a full, true, and correct copy of the Bylaws of Ammogem Corp., a Delaware corporation, as in effect on the date hereof. DATED: July 7, 2004 -------------------------- Lawrence Hamilton Jean Secretary Ammogem Corp. (SEAL) City of Courtenay Province of British Columbia July 7, 2004 10 EX-5 4 ex5.txt OPINION & CONSENT OF KAREN A. BATCHER, ESQ Exhibit 5 ZARCONE & BAKER, LLP 4252 Bonita Road, #151 Bonita, CA 91902 Tel. 619.475.7882 Fax 619.789.6262 August 23, 2005 Board of Directors Ammogem Corp. 2316A Willemar Avenue Courtenay, BC Canada V9N 3M8 Re: Legal Opinion Pursuant to SEC Form SB-2 Registration Statement - Ammogem Corp. Dear Mr. Jean: At your request, we are rendering this opinion in connection with a proposed sale by 43 individual shareholders (the "Selling Shareholders"), of Ammogem Corp. (the "Company") of up to 142,600 shares of common stock, $$.0001 par value (the "Common Stock") and up to 300,000 shares of Common Stock to be sold by the Company. The Selling Shareholders are identified in the Registration Statement on Form SB-2. I have examined instruments, documents and records, which we deemed relevant and necessary for the basis of our opinion hereinafter expressed. I have done so in light of Delaware law, including without limitation, the statutory provisions, all applicable provisions of the Delaware constitution and reported judicial decisions interpreting those laws. In such examination, I have assumed the following: (a) the authenticity of original documents and the genuineness of all signatures; (b) the conformity to the originals of all documents submitted to us as copies; and (c) the truth, accuracy and completeness of the information, representations and warranties contained in the records, documents, instruments and certificates we have reviewed. Pursuant to ss.228.601 (Item 601) of Regulation S-B, I make the following opinion on the legality of the securities being registered. Based on such examination and the applicable laws of the State of Delaware, I am of the opinion that the 300,000 shares of Common Stock to be sold by the Company are duly authorized shares of Common Stock and the 141,600 shares of Common Stock to be sold by the Selling Shareholders are duly authorized shares of Common Stock which have been legally issued, fully paid and non-assessable. I am also of the opinion that the total of 441,600 shares of Common Stock, when sold after the effectiveness of the Registration Statement, will be validly issued, fully paid and non-assessable. Regards, BATCHER ZARCONE & BAKER, LLP /s/ Karen A. Batcher, Esq. ------------------------------- EX-10 5 ex10.txt LICENSING AGREEMENT Exhibit 10 MANUFACTURING AND MARKETING EXCLUSIVE LICENSE AGREEMENT This Agreement made the 15th day of July, 2004. BETWEEN: AMMOGEM MINERALS CANADA, LTD a Corporation incorporated in the Province of Alberta (The "Licensor") AND: AMMOGEM CORP a Corporation incorporated in the State of Delaware (The "Licensee") WHEREAS: A. The Licensor is the sole owner of proprietary technologies and "Know-how" related to the Product hereinafter referred to as the "Property;" and B. The Licensor warranties that the Trade Secrets related to the Property, have been maintained as Trade Secrets and are afforded the protections under trade secret laws; and C. The Licensor further warranties that the Property and the related Product are free of any lien, encumbrance, joint-ownership, or prior commitment to a third party; D. The Licensor wishes to grant and the Licensee desires the exclusive rights to the Product, including but not limited to the development, manufacturing, marketing, sale, sublicensing, and any and all usages of the Product, in the United States; E. The Licensor wishes to grant and the Licensee desires the exclusive rights to use the Property, as well as Licensor's "Know-how", related to the development, manufacturing, marketing, sale, sublicensing, and usage of the Product, and any future products derived from the Property, in the United States; NOW THEREFORE, in consideration of the premises and mutual promises, terms and conditions and other good and valuable considerations, the parties do hereby agree as follows: 1. DEFINITIONS For the purposes of the Agreement: 1.1 "Product" shall mean all licensed proprietary property, specified in Exhibit A1; 1.2 "Property" shall mean all proprietary intellectual properties, encompassed in the Trade Secret, set forth in Exhibit A1; 1.3 "Know-how" shall mean secret processes, formulae, trade secrets, engineering, design, process and operating information, inventions, developments, technical data and other scientific and technical information relating to any process or method now owned or controlled by the licensor or its Affiliate relating in any way to the Product; 1.4 "Confidential Information": shall mean that part of the Technical Information, whether written or oral which is: 1.41 not publicly known, and 1.42 annotated as "confidential" or "proprietary." Any information which is not annotated as "confidential" or "proprietary" shall be deemed to be in the public domain. In addition, "Confidential Information" shall include information disclosed by either party to the other party in accordance with (Modifications and/or Improvements of Product); 1.5 "Affiliate" whether of the Licensee or the Licensor, shall mean any corporation, firm, association or other business owned or controlled beneficially or directly or indirectly by the Licensee or the Licensor, by its principal officers, directors, supervisory employees or members of their families. Ownership of 50% or more of such business by any one of such persons shall constitute beneficial ownership or control; 1.6 "Manufacturing Cost" shall mean the cost of the "Product" F.O.B. the Licensee's manufacturing plant at point of shipment; 1.7 "Effective Date" shall mean the later of: 1.71 the date on which Licensor executes this Agreement, 1.72 the date on which Licensee executes this Agreement. 2. GRANT OF RIGHTS The Licensor grants the following rights to Licensee: 2 2.1 LICENSED TERRITORY EXCLUSIVE UNITED STATES RIGHTS: The Licensor grants the Licensee the exclusive rights to the Product and the Property in the United States; 2.2 GRANTS RELATED TO LICENSOR'S PRODUCT, PROPERTY AND "KNOW-HOW" 2.21 GRANTS RELATED TO PRODUCT.The Licensor grants the Licensee the exclusive right to the Product, specified in Exhibit A1, including but not limited to, the Licensee's rights to the development, manufacturing, marketing, sale, sublicensing, and any and all usages of the Product in the United States. 2.22 GRANTS RELATED TO PROPERTY. The Licensor grants the Licensee the exclusive right to use the Licensor's Property, specified in Exhibit A1, including but not limited to, the Licensee's rights to develop, manufacture, market, sell and sublicense any and all products, having derived and to be derived from the Property in the United States; 2.23 GRANTS RELATED TO "KNOW-HOW". The Licensor grants the Licensee the exclusive right to the Licensor's "know-how" trade secrets, and other technical information, related to the Product and the Property, to be conveyed to Licensee in confidence, upon the consummation of this Agreement. 3. CONSIDERATIONS TO LICENSOR In order to keep the Exclusive License Agreement in good standing and in force and effect, Ammogem Corporation shall be obligated to: 3.1 CASH PAYMENTS (i) Pay to Ammogem Canada $5,000 by October 31, 2004; (ii) 40% of the gross revenues of the Licensee. 3.2 Expenditure Commitments (i) Reimburse to Ammogem Canada exploration and development costs of up to $10,000 by December 31, 2006, which work shall be conducted by Ammogem Canada under the direction of a qualified geologist or project engineer. 4. TERMS AND CONDITIONS 4.1 TERMS AND CONDITIONS RELATED TO THE GRANTS TO LICENSEE 4.11 DEVELOPMENT OF TECHNOLOGY. The Licensor agrees to assist the Licensee to conclude the negotiations on technologies under consideration as set out in Exhibit A1, "Property." 3 4.12 MARKETING AND MANUFACTURING PERIMETERS. The Licensee, at its own costs, shall manufacture and market the Product to potential client firms. 4.13 BEST EFFORT BY LICENSEE. The Licensee agrees to use its best efforts and all due diligence to promote the sale of the product and other products derived from the Property, in all licensed territories; 4.14 TRAINING AND TECHNICAL ASSISTANCE. To assist Licensee in exercising its rights hereunder, Licensor agrees to provide appropriate training and technical assistance to Licensee, its employees and its permitted sublicensees, in order for the Licensee to utilize the licensed technology appropriately to their full potential. Such training and assistance shall be provided by Licensor from time to time, for training purposes at Licensee's facilities. Travel costs, lodging and all related expenses incurred by one party, in connection with sending its employees or permitted sublicensees to the other party's location, shall be paid in full by the party requesting the training or technical assistance. However, the Licensee acknowledges hereunder that said training obligation of the Licensor may be limited by the availability of its training and technical personnel; 4.15 WHEN TO DISCLOSE "KNOW-HOW" BY LICENSOR. Commencing ten (10) days after the execution of this Agreement, the Licensor agrees to make full disclosure of its "know-how" to the Licensee's technical personnel, designated by the Licensee. In addition, the Licensor agrees to promptly inform the Licensee of any newly developed technical and trade "know-how", which the Licensee is entitled to record confidentially with any available medium; 4.16 TERMS FOR "KNOW-HOW" DISCLOSURE. All disclosures and instructions shall be made or given at the Licensor's locations, without cost to the Licensee, provided, however, that at the Licensee's request, the Licensor may from time to time send one of its qualified personnel for the purpose of "know-how" disclosure, to the Licensee's location, at the request of the Licensee, for not more than 15 days, the related costs of which shall be assumed by the Licensee; 4.17 CONFIDENTIALITY MAINTAINED BY LICENSEE. All disclosures of the Licensor's "know-how" shall be confidential and shall be held confidentially by the Licensee, without disclosure to a third party, and shall remain confidential for a period of five years. This obligation of non-disclosure shall not apply to any information, which is already known to the Licensee, at the time of disclosure, or which is rightfully obtained from a third party without obligation of confidence, or which is freely available in the public domain. Licensee agrees that the Licensor has a proprietary interest in its Confidential Information, provided to the Licensee. During the term of the Agreement and for five years thereafter, all proprietary disclosures to the Licensee, its agents, and employees shall be held in strict confidence by Licensee. Licensee shall disclose the Confidential Information only to its agents and employees, to whom the dissemination of confidential information is deemed necessary, in order to 4 properly carry out their duties, designated by the Licensee, in its execution of the License. During the term of this Agreement and for five years thereafter, Licensee shall not use the Confidential Information, except for the purposes of exercising its rights and carrying out its duties hereunder. This provision of the Agreement shall also apply to any consultants or subcontractors of the Licensee, that Licensee may engage in connection with its execution of the License. 4.18 PRODUCT QUALITY MAINTAINED BY LICENSEE. In order to comply with the Licensor's quality control standards, Licensee agrees to maintain the quality of the Product, adhering to specific quality control standards, in all aspects of manufacturing, that the Licensor may from time to time communicate to the Licensee, with respect to certain product; 4.2 TERMS AND CONDITIONS RELATED TO THE CONSIDERATIONS TO LICENSOR INTERIM FUNDING TO LICENSOR. Licensee shall advance funds to the Licensor, subject to written approval by the Licensee for services required of the Licensor by the Licensee. 4.3 OTHER TERMS AND CONDITIONS 4.31 OWNERSHIP OF NEW PRODUCT DEVELOPMENT. The undersigned mutually agree to the following ownership rights to new product development: (a) JOINT OWNERSHIP. Any invention, protectable by patent, copyright or other legal proprietary protection, made or conceived during the term of this Agreement, by one or more employees or consultants of the Licensor jointly with one or more employees or consultants of the Licensee, shall be jointly owned, of which the parties agree to grant the license of the related invention(s) to each other without any payment, royalty or consideration. Title to all related patents issued shall be jointly owned. All expenses incurred in obtaining and maintaining such patents, shall be jointly shared. In the event one of the parties declines to apply for a patent, or alternatively fails to pay their portion of the patent costs, then the ownership of the patent shall be held by that party, who wishes to file the patent and assumes the related expenditures; (b) SOLE OWNERSHIP. Any invention, protectable by patent, copyright or other legal proprietary protection made or conceived solely by the employees or consultants of either party of the undersigned, shall become the sole property of such party. 4.32 RIGHT TO ASSIGN LICENSE AGREEMENT. The Licensor and the Licensee mutually agree not to assign the explicit rights of the Licensor or the Licensee, as defined by this Agreement, in whole or part, to a third party, whether by operation of law or otherwise, without the prior written consent of the other party, except that either party may assign its rights hereunder to a successor, subsidiary or affiliated corporation, without releasing the assignor and the assignee, from the contractual responsibilities, stipulated hereunder. Any assignment contrary to the terms hereof shall be null and void and of no force or effect. 4.33 NON-COMPETITION. The Licensor, during the term of this Agreement agrees not to compete with the Licensee on the Licensed Product; 5 5. WARRANTIES 5.1 Licensor's Warranties 5.11 PATENTS MAINTAINED. The Licensor warranties that the Patent and/or Patent Application, related to the Property, are current, updated, and properly maintained with respective patent agencies, with jurisdiction over the Patent and Patent Applications; and 5.12 PROPERTIES WITHOUT OTHER COMMITMENT. The Licensor further warranties that the Property and the related Product are free of any lien, encumbrance, joint-ownership, or prior commitment to a third party. 5.13 NO KNOWLEDGE OF THIRD PARTY CLAIMS. Licensor represents and warrants to Licensee that Licensor knows of no claim by any third party of infringement by Licensor on such party's trademark, copyright, trade secret or any other intellectual property rights in the Territory of the Licensee. 5.2 LICENSEE WARRANTIES 5.21 LAWFUL CORPORATION. The licensee is a lawful U. S. Corporation incorporated in the State of Delaware. 6. DEFENSE OF LICENSED INTELLECTUAL PROPERTIES Pertaining to the infringement of patented licensed technology by a third party, the Licensor of the technology and the Licensee shall together determine whether to take any and all actions, legal or otherwise, which are necessary to: 6.1 terminate infringements of any part of the Licensed Product; or 6.2 terminate any attempt of imitation of any of the Licensed Product, including without limitation, obtaining damages, injunction and all other appropriate relief. The legal costs of said intellectual property defense shall be the responsibility of the Licensee and said Licensor. In addition, if the defense is successful and damages are awarded by the court related to the infringement, such damage award shall be shared equally between the Licensor and the Licensee. However, if for any reason or for no reason, a party of the undersigned elects not to incur the expenditure of the legal defense, and the other party elects to carry solely said expenditure, then accordingly, the damage award, if any, shall be received by the party which has incurred the expenditure of the defense. 6 7. INDEMNITY 7.1 Indemnity by Licensor 7.11 Except as provided in subsection 7.12 below, Licensor of the technology shall defend and indemnify Licensee from and against any damages, liabilities, costs and expenses, including reasonable attorney's fees and court costs, arising out of any claim, involving Licensee's usage of the Licensed Product, or manufacturing of the products, which infringe a valid intellectual property right, or which represent a misappropriation of a trade secret of a third party; provided, however, that: 7.11a Licensee shall have promptly submitted to said Licensor the related written notice of infringement, along with reasonable cooperation, information and assistance from the Licensee, in connection with the case; and 7.11b The said Licensor shall have sole control and authority with respect to the defense settlement, or compromise thereof; 7.12 The said Licensor shall have no liability or obligation to Licensee under this Article with respect to any claim based upon: 7.12a Use of the Product by Licensee, its sublicensees or its customers in an application or environment for which such Product was not designed or contemplated; or 7.12b Modifications and/or improvements of the Product introduced by Licensee, its permitted sublicensees or its customers. 7.13 In the event a claim is based partially on an indemnified claim, described in subsection 7.11, and partially on an non-indemnified claim described in subsection 7.12, any payments and reasonable legal fees incurred in connection with such claim are to be apportioned between the parties in accordance with the degree of cause attributable to each party. 7.2 INDEMNITY BY LICENSEE 7.21 INDEMNITY FOR PRODUCT. Licensee shall defend and indemnify Licensor of the technology from and against any damages, liabilities, costs and expenses, including any reasonable legal fee and court cost, arising out of injuries or damages caused by the Product, which are not attributable to faulty materials or workmanship in the manufacture, or the assembly of the Product by the said Licensor and by the Licensee; 7.22 OFFERING RELATED INDEMNITY. The Licensee hereunder agrees to indemnify and hold harmless the said Licensor, against any and all losses, claims, damages, liabilities and expenses, including any litigation arising from the Licensee's Offering, or involving the subject matter hereof, including but 7 not limited to litigation by the shareholders of the Licensee, upon the fulfillment of the Licensor's contractual duties, except for willful default or negligence perpetrated by the Licensor, involving this Agreement. The Licensee agrees to assume the sole responsibility toward its investors, in all matters relating to the Offering. 8. DURATION AND TERMINATION 8.1 Terms of Agreement The Licensor shall offer the Grants to the Licensee, for a period of ten (10) years, with automatic renewal each year thereafter, subject to written notification, sixty (60) days in advance to the renewal, by both parties of the undersigned. 8.2 TERMINATION FOR CAUSE This Agreement may be terminated by a party of the undersigned, by serving written notice of termination to the other party, which shall become immediately effective upon the documented receipt of such notice of termination, after the occurrence of any of the following events, unless a mutual remedy is reached, by both parties of the undersigned in writing, to obviate the termination, within ninety (90) days from the date of receipt of the notice by a served party: 8.21 a material breach or default as to any obligation, specified hereunder, by the Licensee or the Licensor, and the failure of the notified party to promptly pursue a reasonable remedy to cure such material breach or default; or 8.22 the filing of a petition in bankruptcy, insolvency or reorganization by the Licensee or the Licensor, or the Licensee or Licensor becoming the subject to a composition for creditors, whether by law or agreement, or the Licensee or the Licensor going into receivership or otherwise becoming insolvent; or 8.23 in the event of liquidation, caused by insolvency, the Licensor and the Licensee hereunder agree to give the first right of refusal to acquire the liquidation properties of the other, subject to the rulings of the court on this matter. 8.3 AFTER TERMINATION OR EXPIRY The parties hereto agree to the following conditions, once this Agreement is terminated or expires: 8.31 TERMINATE USAGE OF PRODUCT AND PROPERTY BY LICENSEE. Licensee shall cease any use or practice of the Licensed Product and other products involving the Property; and upon termination or expiration of this Agreement, 8 all sublicenses granted by Licensee during the term of this Agreement shall terminate. Licensee shall, at its own expense, return to Licensor all Confidential Information as soon as practicable after the date of such termination, including original documents, drawings, computer diskettes, models, samples, notes, reports, notebooks, letters, manuals, prints, memoranda and any copies which have been received by Licensee. All such Confidential Information shall remain the exclusive property of Licensor during the term of this Agreement and for five (5) years thereafter. 8.32 PAYMENT OBLIGATIONS FOR UNPAID CONSIDERATION TO LICENSOR. Upon termination of this Agreement, nothing shall be construed to release Licensee from its obligations to pay Licensor any and all royalties or other accrued but unpaid considerations due Licensor, incurred prior to the date of such termination or expiration. 9. DISPUTE RESOLUTION The Licensor and the Licensee agree mutually hereunder to submit any and all unresolved disputes, related to this Agreement, firstly, to the American Arbitration Board (or to a licensed arbitrator mutually agreed on by both parties) and abide by the binding resolution of said arbitration. The venue, if any, of said arbitration board shall reside in the State of Delaware. Since the offices of the Licensor and the Licensee may be situated at a considerable distance from each other, to conserve time and costs, the Licensor and the Licensee agree herein to conduct said arbitration by video conferencing, if permitted by the arbitrator. The non-prevailing party in said arbitration shall be responsible for the costs directly incurred by the arbitration, including but not limited to the arbitrator's fees and telecommunication fees. In addition, the Licensor and the Licensee agree mutually herein that any dispute arising from the Agreement is limited to the compensatory (not punitive) considerations of this Agreement, unless the disputes arise from some unanticipated factors based on criminal negligence or criminal act committed by a party, or malicious and egregious refusal to participate in the dispute arbitration by a party, in which case the ruling of a competent court with jurisdiction over the matter shall be binding. In the unlikely eventuality of the requirement of a court ruling, the venue of said court action shall reside in the State of Delaware or alternatively, in the city where the Licensee has its primary business. In said case, the ruling of a competent court, in said venue, with jurisdiction over the matter shall be binding; 10. SEVERABILITY If any provision of this Agreement is held in whole or in part to be unenforceable for any reason, the Licensor and the Licensee agree hereunder to notify the other party immediately of said unenforceable provision(s) in the Agreement, and to modify this Agreement accordingly to the benefit and consent of both parties. Furthermore, if any provision of this Agreement is declared invalid or unenforceable by a court having competent jurisdiction, it is mutually agreed that this Agreement shall endure except for the part declared invalid or unenforceable by order of such court. The parties shall consult and use their best efforts to agree upon a valid and enforceable provision which shall be a reasonable substitute for such invalid or unenforceable provision in light of the intent of this Agreement. 9 11. FORCE MAJEURE 11.1 Either the Licensee or the Licensor shall be released from its obligations. hereunder to the extent that performance thereof is delayed, hindered or prevented by Force Majeure as defined below, provided that the party claiming hereunder shall notify the other with all possible speed specifying the cause and probable duration of the delay or non-performance and shall minimize the effects of such delay or non-performance. 11.2 Force Majeure means any circumstances beyond the reasonable control of the affected party; 11.3 Without prejudice to the generality of Section 10.12a and without being thereby limited, force majeure includes any one or more of the following: acts or restraints of governments or public authorities; wars, revolution, riot or civil commotion, strikes, lockouts or other industrial action; failure of supplies of power or fuel; damage to the premises or storage facilities by explosion, fire , corrosion, ionizing radiation, radio-active contamination, flood, natural disaster, malicious or negligent act of accident; and breakdown or failure of equipment whether of the affected party or others. 12. ENTIRE AGREEMENT, NO OTHER RELATION, COUNTERPARTS This Agreement contains the entire Agreement between the Licensor and the Licensee. No other agreement, or promise made or before the effective date of the Agreement will be binding on the parties. No modification or addendum to this Agreement is valid, unless mutually endorsed and dated by both parties. Nothing contained herein shall be deemed to create a joint venture, agency or partnership relationship between the parties hereto. Neither party shall have any power to enter into any contracts or commitments in the name of or on behalf of the other party, or to bind the other party in any respect whatsoever, in business outside of this Agreement. This Agreement may be executed in any number of counterparts and by a different party hereto on separate counterparts, each of which, when so executed, shall be deemed to be original and all of which, when taken together, shall constitute one and the same Agreement. IN WITNESS WHEREOF, the Licensor and the Licensee have executed this Agreement on the day and the year first above-written. BY: /s/ Lawrence Jean Dated 07/15/04 ------------------------------- -------------- Ammogem Minerals Canada, Ltd Lawrence Jean, President & Director BY: /s/ Lawrence Jean Dated 07/15/04 ------------------------------- -------------- Ammogem Corp Lawrence Jean, President & Director 10 LISTS OF EXHIBITS EXHIBIT A1 Description 11 Exhibit A1 DESCRIPTION OF PROPERTY The Licensor's Ammonite product including fossil and gem stones. The Licensor's secret processes, formulae, trade secrets, engineering, design, process and operating information, inventions, developments, technical data and other scientific and technical information relating to any process or method now owned or controlled by the Licensor or its Affiliate relating in any way to the Product shall remain a trade secret and are non-disclosable. 12 EX-23.2 6 ex23-2.txt CONSENT OF ARMANDO C. IBARRA, C.P.A. Exhibit 23.2 ARMANDO C. IBARRA Certified Public Accountants A Professional Corporation Armando C. Ibarra, C.P.A. Members of the California Society of Certified Public Accountants Armando Ibarra, Jr., C.P.A., JD Members of the of American Institute of Certified Public Accountants Registered with the Public Company Accounting Oversight Board August 23, 2005 To Whom It May Concern: The firm of Armando C. Ibarra, Certified Public Accountants, APC consents to the inclusion of our report of August 16, 2005, on the reviewed financial statements of Ammogem Corp., (A Development Stage Company) as of June 30, 2005 and 2004, in any filings that are necessary now or in the near future with the U.S. Securities and Exchange Commission. Very truly yours, /s/ Armando C. Ibarra, C.P.A. - ----------------------------------- ARMANDO C. IBARRA, C.P.A. 371 E. Street, Chula Vista, CA 91910 Tel: (619) 422-1348 Fax: (619) 422-1465 -----END PRIVACY-ENHANCED MESSAGE-----