-----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, Tgfwja/LmI4jFCTnCtw9r9EsEKGMUccooEZXnRsKxY6QTtxyOJR0qq2KejRtZwh7 T/oLek8STtCIW5ynkoZclA== 0001144204-08-020892.txt : 20080407 0001144204-08-020892.hdr.sgml : 20080407 20080407111533 ACCESSION NUMBER: 0001144204-08-020892 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 17 CONFORMED PERIOD OF REPORT: 20071231 FILED AS OF DATE: 20080407 DATE AS OF CHANGE: 20080407 FILER: COMPANY DATA: COMPANY CONFORMED NAME: URON INC CENTRAL INDEX KEY: 0001363958 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 470848102 STATE OF INCORPORATION: MN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-52015 FILM NUMBER: 08742118 BUSINESS ADDRESS: STREET 1: 9449 SCIENCE CENTER DRIVE CITY: NEW HOPE STATE: MN ZIP: 55428 BUSINESS PHONE: 763 504 3000 MAIL ADDRESS: STREET 1: 9449 SCIENCE CENTER DRIVE CITY: NEW HOPE STATE: MN ZIP: 55428 10-K 1 v108896_10k.htm Unassociated Document  
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

x
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the fiscal year ended December 31, 2007; or

o
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the transition period from __________ to __________

Commission file number: 000-52015

URON Inc.
(Exact name of registrant as specified in its charter)

Minnesota
 
47-0848102
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
     
2201 West Broadway, Suite 100
Council Bluffs, Iowa
 
51501
(Address of principal executive offices)
 
(Zip code)

Registrant’s telephone number, including area code: (712) 322-4020

Securities to be registered pursuant to Section 12(b) of the Exchange Act: None

Securities to be registered pursuant to Section 12(g) of the Act: Common Stock (title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 of Section 15(d) of the Exchange Act. Yes o No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes x No o

 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “accelerated filer,” “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
 
                   Large Accelerated Filer o Accelerated Filer o 
  Non-Accelerated Filer o Smaller Reporting Company x
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes o No x
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter: $250,003.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date. 9,014,644 common shares as of March 31, 2008.
 

 
TABLE OF CONTENTS

   
Page
PART I
   
ITEM 1:
DESCRIPTION OF BUSINESS
1
ITEM 1A:
RISK FACTORS
7
ITEM 2:
PROPERTIES
14
ITEM 3:
LEGAL PROCEEDINGS
14
ITEM 4:
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
14
     
PART II
   
ITEM 5:
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
15
ITEM 6:
SELECTED FINANCIAL DATA
18
ITEM 7:
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
18
ITEM 7A:
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
21
ITEM 8:
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
21
ITEM 9:
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
21
ITEM 9A(T):
CONTROLS AND PROCEDURES
21
ITEM 9B:
OTHER INFORMATION
23
     
PART III
   
ITEM 10:
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
24
ITEM 11:
EXECUTIVE COMPENSATION
27
ITEM 12:
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
30
ITEM 13:
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
32
ITEM 14:
PRINCIPAL ACCOUNTANT FEES AND SERVICES
33
     
PART IV
   
ITEM 15:
EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES
34
 


PART I

ITEM 1: DESCRIPTION OF BUSINESS.

General Overview

URON Inc., a Minnesota corporation, provides short-term consumer loans, commonly referred to as cash advance loans, through its wholly owned operating subsidiary Wyoming Financial Lenders, Inc., a Wyoming corporation. As of December 31, 2007, we operated 52 stores, with locations in Colorado, Iowa, Kansas, Montana, Nebraska, North Dakota, South Dakota, Utah, Wisconsin and Wyoming. The principal amounts of our typical cash advance loans range from $100 to $500. Since that date, we have acquired ten new stores, including five stores in Arizona (see “Recent Developments,” below). Cash advance loans provide customers with cash in exchange for a promissory note with a maturity of generally two to four weeks and supported by that customer’s post-dated personal check for the aggregate amount of the cash advanced plus a fee. The fee varies from state to state, based on applicable regulations, and generally ranges from $15 to $20 per each $100 borrowed. To repay the cash advance loans, customers may pay with cash, in which case their personal check is returned to them, allow the check to be presented to the bank for collection, or may pay by ACH direct payment.

We also provide ancillary consumer financial products and services that are complementary to our payday-lending business, such as check-cashing services, money transfers and money orders. We also offer guaranteed phone/Cricket™ phones to our customers. Our loans and other services are subject to state regulations (which vary from state to state), and federal and local regulations, where applicable.

Reverse Merger Transaction

Pursuant to an Agreement and Plan of Merger and Reorganization dated December 13, 2007 (the “Merger Agreement”), by and among URON Inc., WFL Acquisition Corp., a Wyoming corporation and wholly owned subsidiary of the Company, and Wyoming Financial Lenders, Inc., a Wyoming corporation whose business is providing directly to consumers cash advance loans and certain ancillary financial services, WFL Acquisition Corp. merged with and into Wyoming Financial Lenders, Inc., with Wyoming Financial Lenders, Inc. remaining as the surviving entity and a wholly owned operating subsidiary of the Company. This transaction is referred to throughout this report as the “Merger.” The Merger was effective as of the close of business on December 31, 2007, by the filing of a certificate of merger with the Wyoming Secretary of State.

At the effective time of the Merger, the legal existence of WFL Acquisition Corp. ceased and all of the 1,000 shares of common stock of Wyoming Financial Lenders, Inc. that were outstanding immediately prior to the Merger were cancelled, with one share of common stock of such corporation issued to the Company. Simultaneously, WERCS, a Wyoming corporation the former sole holder of common stock of Wyoming Financial Lenders, Inc., received (i) 1,125,000 shares of the Company’s common stock, representing approximately 17.9% of the Company’s common stock outstanding immediately after the Merger and (ii) 10,000,000 shares of newly created preferred stock, designated as “Series A Convertible Preferred Stock,” which is presently convertible (subject to adjustment) into the Company’s common stock on a share-for-share basis. On an aggregate and as-if-converted basis, WERCS received and held 11,125,000 common shares representing approximately 68.2% of the Company’s common stock immediately after the Merger. In addition, WERCS received $278,845 in return of capital.
 
1


Prior to the Merger, the Company effected a 1-for-10 share combination (i.e., reverse stock split) of its capital stock, effective as of December 27, 2007. The share combination was approved by Company’s Board of Directors pursuant to the provisions of the Minnesota Business Corporation Act with a corresponding reduction in the number of shares of authorized capital stock. In addition, the Company’s Board of Directors approved an increase in the number of directors comprising the Board of Directors, and appointed five new directors. The Company’s former sole director then resigned from the Board of Directors.

Recent Developments

On February 26, 2008, the Company entered into an Exchange Agreement with National Cash & Credit, LLC, a Minnesota limited liability company, and the members of National Cash & Credit. Under the Exchange Agreement, the members of National Cash & Credit assigned all of the outstanding membership interests in National Cash & Credit to the Company in exchange for the Company’s issuance to such members of an aggregate of 1,114,891 shares of common stock and a cash payment of $100,000. The closing of the transactions contemplated by the Exchange Agreement occurred effective as of February 26, 2008, simultaneously with the effectiveness of the agreement itself. In the transaction, the Company acquired a total of five new stores located in Arizona.

On March 1, 2008, the Company acquired five stores offering payday advance loans in Fargo, Grand Forks, Bismarck and Minot, North Dakota. These stores, currently operating under the Ameri-Cash name, increased to ten the total number of stores which the Company operate in North Dakota. The Company paid approximately $400,000 for these stores and associated assets.

An Important Note on Language: Throughout this report, unless the context otherwise requires, references to the “Company” and “we” and “our” are references to URON Inc. on a post-Merger basis, and so they include the business of Wyoming Financial Lenders, Inc. which we acquired in the Merger.

Industry Background

We believe there has always been a strong demand for small, short-term consumer loans in the United States. However, traditional lenders like banks and finance companies have often been constrained by laws (or internal policies) that make providing small, short-term loans cost prohibitive. In addition, these smaller, short-term loans are incompatible with the acceptable risk level common to many traditional lenders. Traditional lenders generally appear to have moved away from this type of lending. The departure of traditional credit providers appears to have contributed to the rise of payday lending.

The cash advance loan industry began its rapid growth in 1996, when there were an estimated 2,000 cash advance loan stores in the United States. Currently, there are an estimated 22,000 cash advance loan stores in the United States, which in the aggregate provide approximately $40 billion in short-term credit to millions of middle-class households experiencing cash-flow shortfalls (Source: Financial Services Association of America). During this same time, the number of states that expressly permit or do not expressly prohibit cash advance loans has grown from six to 36 states and the District of Columbia. Currently, industry trends indicate that, overall, there is likely to be a net decrease in total payday lending stores over the next few years from closings resulting primarily from regulatory changes and a slowdown in new store growth and general economic conditions. In 2007, the payday lending store base declined approximately 2.5% (approximately 600 stores), the first such decline in seven years. Nevertheless, the industry’s internet volume during 2007 increased by 40% over the prior year. (Source: Joseph Steven & Co, Inc.).
 
2


Cash advance loan customers typically are middle-income or lower-middle-income, middle-educated individuals who are a part of a young family. In addition, many customers claim to have at least one other alternative to using a cash advance loan that offers quick access to money, such as overdraft protection, credit cards, credit union loans or savings accounts. We believe that our customers choose the cash advance loan product because it is quick, convenient and, in many instances, a lower-cost or more suitable alternative for the customer than the other available alternatives.

Services

Cash Advance Loans

Customers seeking to obtain a cash advance loan must complete a loan application, maintain a personal checking account, have a suitable source of income, and not otherwise be in default on a loan from us. Upon completion of a loan application and our acceptance of such application, the customer signs a promissory note and provides us with a check for the principal loan amount plus a specified fee. State laws typically limit fees to a range of $15 to $20 per each $100 of principal borrowed. Loans generally mature in two to four weeks, on or near the date of a customer’s next payday. Our standard agreement with customers provides that we will not cash their check until the due date of the associated loan. The customer’s debt to us is satisfied by: (i) payment of the full amount owed in cash (at which point we return the customer’s personal check); (ii) deposit of the customer’s check with the bank; or (iii) ACH direct payment.

Where permitted by state regulation, a customer may renew a loan after full payment of the fee associated with the original loan. When applicable, a customer renewing a loan signs a new promissory note and provides us with a new check.

The cash advance-lending business is seasonal due to the fluctuating demand for cash advance loans during the year. Usually, the highest demand for cash advance loans occurs in January and in the fourth calendar quarter. Due to the receipt of income-tax refunds, demand for cash advance loans normally declines from February through April. As with most payday lenders, our loan loss ratio fluctuates with these changes in demand, with a higher loss ratio being typical in the second and third calendar quarters and a lower loss ratio being typical in the first and fourth calendar quarters.

Other Financial Services

We also offer other consumer financial services, such as check-cashing services, phone services, installment loans, money transfers and money orders. Together, these other financial services constituted 20% and 21% of our revenues for the fiscal years ended December 31, 2007 and 2006, respectively.

Marketing Strategy

Our advertising and marketing efforts are designed to introduce customers to our services, build customer loyalty and generate repeat visits and transactions. Our principal means of advertising consists of promotional materials and Yellow Page directories used in our active markets.

Technology and Information

We maintain an integrated system of software applications and platforms for processing the various types of transactions we offer. These systems provide us with customer service, internal control mechanisms, record-keeping and reporting information. As of the date of this report, we have one point-of-sale system used by all of our payday locations, and a different point-of-sale system used for our title loan services. On a daily basis, transaction data is collected and integrated into our management information systems. These systems are designed to provide summary, detailed and exception information to regional, area and store managers as well as corporate staff.
 
3


Security

We believe the principal security risks to our operations are robbery and employee theft. We have established extensive security systems, dedicated security personnel and management information systems to address both areas of potential loss.

To protect against robbery, most store employees work behind bullet-resistant glass and steel partitions, and the back office, safe and computer areas are locked and closed to customers. Our security measures in each store include safes, electronic alarm systems monitored by third parties, control over entry to customer service representative areas, detection of entry through perimeter openings, walls and ceilings and the tracking of all employee movement in and out of secured areas. Employees use cellular phones to ensure safety and security whenever they are outside the secure customer service representative area. Additional security measures include alarm systems in all stores, remote control over alarm systems, arming/disarming and changing user codes and mechanically and electronically controlled time-delay safes.

Since we have high volumes of cash and negotiable instruments at our locations, daily monitoring, unannounced audits and immediate responses to irregularities are critical. Our regional managers perform weekly unannounced store audits and cash counts at our stores. We self-insure for employee theft and dishonesty at the store level.

Competition

Like most other cash advance lenders, we believe that the primary competitive factors in our business are location and customer service. We face intense competition in an industry with relatively low barriers to entry, and we believe that the cash advance lending markets are becoming more competitive as the industry matures and consolidates. We compete with other cash advance and check cashing stores and financial service entities and retail businesses that offer cash advance loans or similar financial services. In addition, we compete in part with services offered by traditional financial institutions, such as overdraft protection.

Additional areas of competition have recently arisen. Businesses now offer loans over the internet as well as “loans by phone,” and these have begun to compete with us. There also has been increasing penetration of electronic banking and related services into the check cashing and money transfer industry, including direct deposit of payroll checks, payroll cards, stored-value cards and electronic transfer of government benefits.

We believe that our management team, which has a combined 36 years of industry experience, provides us with a competitive strength. We also believe that customer service is critical to developing loyalty. In our industry, we believe that quality customer service means (i) assisting with the loan application process and understanding the loan terms, (ii) treating customers respectfully, (iii) processing transactions with accuracy, efficiency and speed.

4

 

Governmental Regulation

We are subject to regulation by federal, state and local governments that affect the products and services we provide. Generally, these regulations are designed to protect consumers who deal with us and are not designed to protect our shareholders.

Regulation of Cash Advance Lending

Our business activities are subject to regulation and supervision at the state and federal levels. In those states where we currently operate, we are licensed as a payday lender where required and are subject to various state regulations regarding the terms of our cash advance loans and our policies, procedures and operations. In some states, cash advance lending is referred to as deferred presentment, deferred deposit or consumer installment loans. State regulations normally limit the amount that we may lend to any consumer and may limit the number of loans that we may make to any consumer at one time or in the course of a year. State regulations also limit the amount of fees that we may assess in connection with any loan or transaction and may limit a customer’s ability to renew a loan with us. The state statutes also often specify minimum and maximum maturity dates for cash advance loans and, in some cases, specify mandatory cooling-off periods between transactions. We must also comply with the disclosure requirements of the Federal Truth-In-Lending Act and Regulation Z thereunder. Our collection activities for delinquent loans are generally subject to consumer protection laws regulating debt collection practices. Finally, our business subjects us to the Equal Credit Opportunity Act and the Gramm-Leach-Bliley Act.

Recent Legal Developments and Trends

During the last few years, legislation has been introduced in the U.S. Congress and in certain states proposing various restrictions or an outright prohibition on cash advance loans. Currently, state laws in Oregon, and Georgia have effectively eliminated the ability to conduct cash advance lending activities in those states, and a recent federal law prohibits loans of any type to members of the military and their family with charges or interest in excess of 36% per annum.

More recently, two bills have been introduced in the Nebraska legislature. The first bill is designed primarily to enhance reporting and enforcement of current payday lending restrictions and, in particular, would require the Nebraska Department of Banking to set up a database tracking delayed-deposit transactions (which would include payday lending transactions) at all storefront businesses statewide. The information reported would be used to ensure that individuals could not borrow more than $500 from any single business, which is current state law in Nebraska. The bill also would require a 72-hour waiting period between loans so that a customer could not pay off a loan and then immediately take out another. A second bill would flatly outlaw the business of payday lending in Nebraska.

The likelihood that either of these bills will become law in Nebraska is uncertain. The Company believes that passage of the first bill would not materially or adversely effect the Company or its business. However, passage of the second bill proposing to prohibit payday lending in Nebraska would certainly have a material and adverse effect on the Company and its business prospects since approximately 36% of the Company’s revenues during fiscal 2007 were generated in Nebraska. The Company is monitoring the situation in Nebraska.
 
In addition, current state law in Arizona will effectively ban payday lending as of July 1, 2010. Legislation to extend or overturn the ban is pending. Nevertheless, even if the prohibition is delayed or eliminated, we believe it is likely that such delay or elimination will be accompanied by limitations on fees or interest rates chargeable by payday lenders, in addition to other possible restrictions. Presently, we have five stores in Arizona. At this point, it is difficult to assess the materiality of any limitations on the business we conduct in Arizona. A ban on payday lending in Arizona could have a material adverse effect on our business.
 
5

 
Financial Reporting Regulation

Regulations promulgated by the United States Department of the Treasury under the Bank Secrecy Act require reporting of transactions involving currency in an amount greater than $10,000. Generally, every financial institution must report each deposit, withdrawal, exchange of currency or other payment or transfer that involves an amount greater than $10,000. In addition, multiple currency transactions must be treated as a single transaction if the financial institution has knowledge that the transactions are by or on behalf of any one person and result, in a single business day, in the transfer of cash in or out totaling more than $10,000. In addition, the regulations require institutions to maintain information concerning sales of monetary instruments for cash in amounts from $3,000 to $10,000.

Furthermore, the Money Laundering Act of 1994 requires us, as a money service business, to register with the United States Department of the Treasury. Money services businesses include check cashers and sellers of money orders. Money services businesses must renew their registrations every two years, maintain a list of their agents, update the agent list annually and make the agent list available for examination. In addition, the Bank Secrecy Act requires us, under certain circumstances, to file a suspicious activity report.

Finally, we have established various procedures designed to comply, and we continue to monitor and evaluate our business methods and procedures to ensure compliance, with the USA PATRIOT Act.

Privacy Regulation

We are subject to a variety of federal and state laws and regulations restricting the use and seeking to protect the confidentiality of customer identity and other personal nonpublic customer information. We have identified our systems that capture and maintain nonpublic personal information, as that term is understood under the Gramm-Leach-Bliley Act and associated regulations. We disclose our public information policies to our customers as required by that law. We also have systems in place intended to safeguard this information as required by the Gramm-Leach-Bliley Act.

Employees

As of December 31, 2007, we had approximately 120 employees, consisting of 110 store personnel, three field managers and seven corporate office employees. We believe our relationship with our employees is good, and we have not suffered any work stoppages or labor disputes. We do not have any employees that operate under collective-bargaining agreements.

6

 

ITEM 1A.
RISK FACTORS.

The purchase of shares of our common stock is very speculative and involves a very high degree of risk. An investment in the Company is suitable only for the persons who can afford the loss of their entire investment. Accordingly, investors should carefully consider the following risk factors, as well as other information set forth herein, in making an investment decision with respect to our securities.

The cash advance loan industry is highly regulated under state laws. Changes in state laws and regulations governing lending practices, or changes in the interpretation of such laws and regulations, could negatively affect our business.

Our business is regulated under numerous state laws and regulations, which are subject to change and which may impose significant costs or limitations on the way we conduct or expand our business. As of the date of this report, approximately 36 states and the District of Columbia had legislation permitting or not prohibiting cash advance loans. During the last few years, legislation has been adopted in some states that prohibits or severely restricts cash advance loans. In 2006, Oregon passed a ballot initiative that caps interest rates and origination fees on cash advance loans at 36%, among other limitations. Before that, Georgia law effectively prohibited direct payday lending in 2004. There are nearly always bills pending in various states to revise the current laws governing cash advance loans. Any of these bills, or future proposed legislation or regulations prohibiting cash advance loans or making them less profitable or unprofitable, could be passed in any of these states at any time, or existing cash advance loan laws could expire or be amended. A wide range of legislative or regulatory actions in any number of states could have a material and adverse effect on our revenues and earnings.

Statutes authorizing cash advance loans typically provide state agencies that regulate banks and financial institutions with significant regulatory powers to administer and enforce the laws relating to payday lending. Under statutory authority, state regulators have broad discretionary power and may impose new licensing requirements, interpret or enforce existing regulatory requirements in different ways or issue new administrative rules, even if not contained in state statutes, that affect the way we do business and may force us to terminate or modify our operations in those jurisdictions. They may also impose rules that are generally adverse to our industry. Finally, in many states, the attorney general has scrutinized or continues to scrutinize the cash advance loan statutes and the interpretations of those statutes. Any significant change in the interpretation of existing state statutes permitting payday lending could have a material and adverse affect on our business.

Our business is subject to complex federal laws and regulations governing lending practices, and changes in such laws and regulations could negatively affect our business.

Although states provide the primary regulatory framework under which we offer cash advance loans, certain federal laws also affect our business. For example, because cash advance loans are viewed as extensions of credit, we must comply with the federal Truth-in-Lending Act and Regulation Z thereunder. Additionally, we are subject to the Equal Credit Opportunity Act, the Gramm-Leach-Bliley Act and certain other federal laws. Any failure to comply with any of these federal laws or regulations could have a material adverse effect on our business, results of operations and financial condition.

Additionally, anti-cash advance loan legislation has been introduced in the U.S. Congress in the past. These efforts culminated in federal legislation in 2006 that limits the interest rate and fees that may be charged on any loans, including cash advance loans, to any person in the military to 36% per annum. The military lending prohibition became effective on October 1, 2007. Future federal legislative or regulatory action that restricts or prohibits cash advance loans could have a material adverse impact on our business, results of operations and financial condition.
 
7


Changes in local regulations could have a material adverse effect on our business, results of operations and financial condition.

In addition to state and federal laws and regulations, our business is subject to various local rules and regulations such as local zoning regulations and permit licensing. We are aware of increasing efforts by local jurisdictions to restrict payday lending through the use of local zoning and permitting laws. Any actions taken in the future by local zoning boards or other governing bodies to require special use permits for, or impose other restrictions on, payday lenders could have a material adverse effect on the growth of our business, results of operations and business prospects.

Litigation and regulatory actions directed toward our industry or us could adversely affect our operating results, particularly in certain key states.

During the last few years, our industry has been subject to regulatory proceedings, class action lawsuits and other litigation regarding the offering of cash advance loans, and we could suffer losses resulting from interpretations of state laws in those lawsuits or regulatory proceedings, even if we are not a party to those proceedings. For example, the North Carolina Commissioner of Banks recently issued a ruling in which it determined that Advance America, which marketed, originated, serviced and collected cash advance loans on behalf of a state-chartered bank located in Kentucky, violated various North Carolina consumer-protection statutes.

Additionally, regulatory actions taken with respect to a particular non-payday lending financial service that we offer could negatively affect our ability to offer such other financial services. For example, if we were the subject of regulatory action related to our check cashing, title loans or other products, that regulatory action could adversely affect our ability to maintain our licenses for payday lending. Moreover, the suspension or revocation of our license or other authorization in one state could adversely affect our ability to maintain licenses in other states. Accordingly, a violation of a law or regulation in otherwise unrelated products or jurisdictions could affect other parts of our business and adversely affect our business and operations as a whole.

We may need additional financing in the future and any such financing may dilute our existing shareholders.

We anticipate that we will continue to experience growth in our income and expenses for the foreseeable future and that our operating expenses will be a material use of cash resources. In the event that income growth does not meet our expectations, we may require additional financing for working capital. In addition, if we determine to grow our business through acquisitions, any acquisitions we consummate may involve outside financing. Any additional financing may involve dilution of our existing shareholders.

Additional financing could be sought from a number of sources, including but not limited to additional sales of equity or debt securities (including equity-linked or convertible debt securities), loans from banks, loans from affiliates of the Company or other financial institutions. We may not, however, be able to sell any securities or obtain any such additional financing when needed, or do so on terms and conditions acceptable or favorable to the Company, if at all. If financing is not available, we may be forced to consider strategic alternatives, such as (but not limited to) curtailing certain aspects of our operations or closing certain operating locations. If we successfully enter into a financing transaction, any additional equity or equity-linked financing would be dilutive to shareholders, and additional debt financing, if available, may involve restrictive covenants.
 
8


The concentration of our revenues in certain states could adversely affect us.

We currently operate in ten states. For the year ended December 31, 2007, revenues from our locations in Nebraska represented approximately 36% of our total revenues. For the foreseeable future, we expect that a material and significant portion of our revenues will continue to be generated in Nebraska. As a result, changes to prevailing economic, demographic, regulatory or any other conditions, including the legislative, regulatory or litigation risks mentioned above, in the markets in which we operate, and Nebraska in particular, could lead to a reduction in demand for our cash advance loans, a decline in our revenues or an increase in our provision for doubtful accounts, or even an outright legal prohibition on the conduct of our business. Any of these outcomes could result in a material and swift deterioration of our financial condition, operating results and business prospects.

Unpredictability in financing markets could impair our ability to grow our business through acquisitions.

We anticipate that opportunities to acquire similar businesses will materially depend on the availability of financing alternatives with acceptable terms. As a result, poor market conditions or uncertainty in the financing markets could materially limit our ability to grow through acquisitions.

Public perception of cash advance lending as being predatory or abusive could adversely affect our business.

Recently, consumer advocacy groups and media reports have advocated governmental action to prohibit or severely restrict cash advance loans. The consumer groups and media reports typically focus on the cost to a consumer for this type of loan, which is higher than the interest typically charged by credit card issuers. This difference in credit cost is more significant if a consumer does not promptly repay the loan, but renews, or rolls over. The consumer groups and media reports typically characterize these transactions as predatory or abusive toward consumers. If this negative characterization of our business becomes widely accepted by consumers, demand for our cash advance loans could significantly decrease, which could adversely affect our results of operations and financial condition. Negative perception of our business activities could also result in our industry being subject to more restrictive laws and regulations and greater exposure to litigation.

Any disruption in the availability of our information systems could adversely affect our operations.

We rely upon our information systems to manage and operate our business. Each location is part of an information network that permits us to maintain adequate cash inventory, reconcile cash balances daily, report revenues and loan losses timely. Our security measures could fail to prevent a disruption in the availability of our information systems or our back-up systems could fail to operate properly. Any disruption in the availability of our information systems could adversely affect our operations and our results of operations.

If we lose key managers or are unable to attract and retain the talent required for our business, our operating results could suffer.

Our future success depends to a significant degree upon the members of our executive management, particularly Christopher Larson, our Chief Executive Officer and President, John Quandahl, our Chief Operating Officer and Steven Staehr, our Chief Financial Officer. Accordingly, the loss of the services of any of these individuals could adversely affect our business. Our continued growth will also depend upon our ability to attract and retain additional skilled management personnel. Competition for highly skilled and experienced management is intense and likely to continue and increase. To the extent that we are unable to attract and retain the talent required for our business, our operating results could suffer.
 
9


We lack product and business diversification, which creates a risk that our future revenues and earnings will be susceptible to fluctuations.

Our primary business activity is offering and servicing cash advance loans. We also provide certain related services, such as check cashing, money transfers and money orders, which related services accounted for approximately 20% of our revenues in fiscal 2007. If we are unable to maintain and grow the operating revenues from our cash advance loan business, our future revenues and earnings are not likely to grow and could decline. Our lack of product and business diversification could inhibit the opportunities for growth of our business, revenues and profits.

Competition in the retail financial services industry is intense and could cause us to lose market share and revenues.

We believe that the primary competitive factors in the cash advance loan industry are store location and customer service. We face intense competition in the cash advance loan industry, and we believe that the payday lending market is becoming more competitive as this industry matures and begins to consolidate. The cash advance loan industry has low barriers to entry, and new competitors may enter the market easily. We currently compete with services, such as overdraft protection offered by traditional financial institutions, and with other cash advance loan and check cashing stores and other financial service entities and retail businesses that offer cash advance loans or other similar financial services, as well as a rapidly growing internet-based cash advance loan market. Some of our competitors have larger and more established customer bases and substantially greater financial, marketing and other resources than we have. As a result, we could lose market share and our revenues could decline, thereby affecting our earnings and potential for growth.

General economic conditions affect our loan losses, and accordingly, our results of operations could be adversely affected by a general economic slowdown.

Provision for loan losses, net of recoveries, is one of our largest operating expenses, constituting approximately 13% of total revenues for the fiscal year ended December 31, 2007, with cash advance loan losses comprising most of the losses. At the end of each fiscal quarter, management considers recent collection history to develop expected loss rates, which are used to establish the allowance for loan losses. Any changes in economic factors that adversely affect our customers could result in higher loan loss experiences than anticipated, which could in turn adversely affect our loan charge-offs and operating results.

If estimates of our loan losses are not adequate to absorb actual losses, our financial condition and results of operations may be adversely affected.

We maintain an allowance for loan losses at levels to cover the estimated incurred losses in the collection of our loan portfolio outstanding at the end of each applicable period. At the end of each period, management considers recent collection history to develop expected loss rates, which are used to establish the allowance for loan losses. Our allowance for loan losses was $976,000 on December 31, 2007. Our allowance for loan losses is an estimate, and if actual loan losses are materially greater than our allowance for losses, our financial condition and results of operations could be adversely affected.
 
10


Because we maintain a significant supply of cash in our locations, we may experience losses due to employee error and theft.

Because our business requires us to maintain a significant supply of cash in our stores, we are subject to the risk of cash shortages resulting from employee error and theft. We periodically experience employee error and theft in stores, which can significantly increase the operating losses of those stores for the period in which the employee error or theft is discovered. We self-insure for employee error or theft at the store level. If our controls to limit our exposure to employee error and theft at the store level and at our corporate headquarters do not operate effectively or are structured ineffectively, our financial condition and results of operations could be adversely affected.

Regular turnover among our location managers and employees makes it more difficult for us to operate our locations and increases our costs of operation.

We experience a relatively stable workforce among our location managers and employees. Turnover interferes with implementation of operating strategies. Increases in our workforce turnover in the future would likely increase our operating pressures and operating costs and could restrict our ability to grow. Additionally, high turnover would create challenges for us in maintaining high levels of employee awareness of and compliance with our internal procedures and external regulatory compliance requirements.

Our directors, officers and our controlling shareholder possess controlling voting power with respect to our common stock and voting preferred stock, which will limit practically your influence on corporate matters.

Our officers and directors collectively possess beneficial ownership of approximately 14,770,094 shares of our common stock, which currently represents approximately 77.7% of our common stock. This includes all of the 1,125,000 common shares and 10,000,000 shares of Series A Convertible Preferred Stock (presently convertible into our common stock on a share-for-share basis) held by WERCS, a Wyoming corporation and the former sole stockholder of Wyoming Financial Lenders, Inc. As a result, our directors, officers and WERCS (our most significant shareholder), will have the ability to outrightly control our management and affairs through the election and removal of our directors, and all other matters requiring shareholder approval, including the future merger, consolidation or sale of all or substantially all of our assets. This concentrated control could discourage others from initiating any potential merger, takeover or other change-of-control transaction that may otherwise be beneficial to our shareholders. Furthermore, this concentrated control will limit the practical effect of your participation in Company matters, through shareholder votes and otherwise.

Our articles of incorporation grant our Board of Directors the power to issue additional shares of common and preferred stock and to designate other classes of preferred stock, all without shareholder approval.

Our authorized capital consists of 250 million shares of capital stock. Pursuant to authority granted by our articles of incorporation, our Board of Directors, without any action by our shareholders, may designate and issue shares in such classes or series (including other classes or series of preferred stock) as it deems appropriate and establish the rights, preferences and privileges of such shares, including dividends, liquidation and voting rights. The rights of holders of other classes or series of stock that may be issued could be superior to the rights of holders of our common shares. The designation and issuance of shares of capital stock having preferential rights could adversely affect other rights appurtenant to shares of our common stock. Furthermore, any issuances of additional stock (common or preferred) will dilute the percentage of ownership interest of then-current holders of our capital stock and may dilute the Company’s book value per share.
 
11


Because we became public by means of a reverse merger, we may not be able to attract the attention of major brokerage firms.

Additional risks to our investors may exist since we became public through a “reverse merger.” Security analysts of major brokerage firms may not provide coverage of the Company since, because we became public through a reverse merger, there is no incentive to brokerage firms to recommend the purchase of our common stock. In addition, because of past abuses and fraud concerns stemming primarily from a lack of public information about newly public businesses, there are many people in the securities industry and business in general who view reverse merger/public shell transactions with suspicion. Without brokerage firm and analyst coverage, there may be fewer people aware of the Company and its business, resulting in fewer potential buyers of our securities, less liquidity, and depressed stock prices for our investors.

Wyoming Financial Lenders, Inc. may have material liabilities of which the Company is not aware, or vice versa.

Although each of the parties to the Merger conducted a due-diligence review of the financial condition and legal status of the other, the Company may have material liabilities that Wyoming Financial Lenders, Inc. is not aware of and has not yet discovered or, conversely, Wyoming Financial Lenders, Inc. may have material liabilities that the Company was not aware and did not discover prior to the consummation of the Merger. Further, although the Merger Agreement contained customary representations and warranties from both parties concerning their assets, liabilities, financial condition and affairs, it is possible that none of the Company, Wyoming Financial Lenders, Inc. (as the operating entity after the Merger) or the pre-Merger owners of either entity will have any material recourse against another party or its former or current owners or principals in the event such representations and warranties prove to be untrue, with resulting damages.

We are subject to the Sarbanes-Oxley Act and the reporting requirements of federal securities laws, which can be expensive.

As a result of the Merger, we are subject to the Sarbanes-Oxley Act and became a public reporting company and, accordingly, subject to the information and reporting requirements of the Securities Exchange Act of 1934 and other federal securities laws. The costs of compliance with Sarbanes-Oxley, of preparing and filing annual and quarterly reports, proxy statements and other information with the SEC, furnishing audited reports to our shareholders, and other legal, audit and internal resource costs attendant with being a public reporting company will cause our expenses to be significantly higher than they would be if Wyoming Financial Lenders, Inc. had remained privately held.

Our common stock trades only in an illiquid trading market.

Trading of our common stock is conducted on the over-the-counter bulletin board. This has an adverse effect on the liquidity of our common stock, not only in terms of the number of shares that can be bought and sold at a given price, but also through delays in the timing of transactions and reduction in security analysts’ and the media’s coverage of our Company and its common stock. This may result in lower prices for our common stock than might otherwise be obtained and could also result in a larger spread between the bid and asked prices for our common stock.
 
12


There is not now and there may not ever be an active market for shares of our common stock.
 
In general, there has been very little trading activity in shares of the Company’s common stock. The small trading volume will likely make it difficult for our shareholders to sell their shares as and when they choose. Furthermore, small trading volumes are generally understood to depress market prices. As a result, you may not always be able to resell shares of our common stock publicly at the time and prices that you feel are fair or appropriate.

We do not intend to pay dividends on our common stock for the foreseeable future. We will, however, pay dividends on our convertible preferred stock.

Wyoming Financial Lenders, Inc. has in the past paid dividends to WERCS (its former sole stockholder prior to the Merger). In the Merger, WERCS was issued 10,000,000 shares of “Series A Convertible Preferred Stock,” each share of which carries a $2.10 stated value. Such preferred stock entitles its holders to (i) a cumulative 10% dividend, compounded and payable on a quarterly basis; (ii) in the event of a liquidation or dissolution of the Company, a preference in the amount of all accrued but unpaid dividends plus the stated value of such shares, before any payment shall be made or any assets distributed to the holders of any junior securities; (iii) convert their preferred shares into common shares of the Company on a share-for-share basis (subject to adjustment); and (iv) vote their preferred shares on an as-if-converted basis. The Company has the right to redeem some or all such preferred shares, at any time upon 60 days’ advance notice, at a price dependent upon the date of redemption. In the case of any redemption closing on or prior to March 31, 2009, the redemption price will be $3.00 per share plus accrued but unpaid dividends; thereafter, the redemption price will $3.50 per share plus accrued but unpaid dividends. Holders of Series A Convertible Preferred Stock have no preemptive or cumulative-voting rights.

We do not anticipate that we will cause the Company to pay any dividends after the Merger for the foreseeable future on our common class of stock. Accordingly, any return on an investment in our Company will be realized only when you sell shares of our common stock.

13

 

ITEM 2. PROPERTIES.

Our headquarters is in Council Bluffs, Iowa. We have a 3,500 square feet space which is sufficient for our projected near term future growth. The monthly lease amount is $3,280 and the term runs through November 2010. The corporate phone number is (712) 322-4020.

As of the date of this report, we have approximately 61 total store locations. Those locations typically range in size from 1,000 square feet to 2,000 square feet, and have varying lease terms (none of which, however, have remaining terms of more than five years). As of the date of this report, we have stores in the following cities:

· Chandler, Arizona
 
· Buckeye, Arizona
 
· Lower Buckeye, Arizona
 
· Surprise, Arizona
 
· Mesa, Arizona
 
· Sterling, Colorado
 
· Ames, Iowa
 
· Des Moines, Iowa (four locations)
 
· Sioux City, Iowa
 
· Dodge City, Kansas
 
· Garden City, Kansas
 
· Billings, Montana (two locations)
 
· Butte, Montana
 
· Great Falls, Montana
 
· Holdrege, Nebraska
 
· Columbus, Nebraska
 
· Grand Island, Nebraska
 
· Hastings, Nebraska
 
· Lincoln, Nebraska (four locations)
 
· North Platte, Nebraska
 
· Omaha, Nebraska (six locations)
· Bismarck, North Dakota (two locations)
 
· Grand Forks, North Dakota (four locations)
 
· Fargo, North Dakota
 
· Minot, North Dakota
 
· Aberdeen, South Dakota
 
· Rapid City, South Dakota
 
· Sioux Falls, South Dakota
 
· Watertown, South Dakota
 
· Salt Lake City, Utah
 
· Sandy, Utah
 
· Taylorsville, Utah
 
· West Jordan, Utah
 
· Kenosha, Wisconsin (three locations)
 
· Pleasant Prairie, Wisconsin
 
· Racine, Wisconsin (two locations)
 
· East Casper, Wyoming
 
· Gillette, Wyoming
 
· Laramie, Wyoming
 
· Sheridan, Wyoming
 
· West Casper, Wyoming
 
· Rock Springs, Wyoming

ITEM 3.
LEGAL PROCEEDINGS.

The Company is not currently involved in any material legal proceedings. Nevertheless, our business frequently involves many immaterial legal proceedings relating primarily to the collection of customer debts.

ITEM 4.
SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

Not applicable.

14

 

PART II

ITEM 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Market Information

Our common stock is listed for trading on the over-the-counter bulletin board under the symbol “URON.OB.” The transfer agent and registrar for our common stock is Corporate Stock Transfer, Inc., 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado 80209. The following table sets forth the high and low bid prices for our common stock as reported by the OTC Bulletin Board in 2007. The Company’s common shares did not begin trading on the OTC Bulletin Board until February 2007. These quotations reflect inter-dealer prices, without retail mark-up, markdown, or commission, and may not represent actual transactions. Trading in the Company’s common stock during the period represented was sporadic, exemplified by low trading volume and many days during which no trades occurred.

   
Year Ended December 31, 2007
 
   
High
 
Low
 
First Quarter
 
$
4.00
 
$
1.30
 
Second Quarter
 
$
4.00
 
$
1.10
 
Third Quarter
 
$
3.00
 
$
.50
 
Fourth Quarter
 
$
3.00
 
$
.50
 

Holders

As of the date of this report, we had 9,014,644 shares of common stock outstanding held by approximately 500 holders of record.

Dividends

Holders of our common stock are entitled to share pro rata in dividends and distributions with respect to the common stock when, as and if declared by our Board of Directors out of funds legally available therefor. We have not paid any dividends on our common stock and intend to retain earnings, if any, to finance the development and expansion of our business. Additionally, the Company must first pay preferred dividends on its Series A Convertible Preferred Stock as described under the caption “Description of Equity Securities” below. The current dividend payable to the holders of Series A Convertible Preferred Stock aggregates to $525,000 on a quarterly basis. Other than with respect to shares of Series A Convertible Preferred Stock, future dividend policy is subject to the sole discretion of our Board of Directors and will depend upon a number of factors, including future earnings, capital requirements and our financial condition.

15

 

Securities Authorized for Issuance under Equity Compensation Plans

The table below sets forth certain information, as of the close of business on December 31, 2007, regarding equity compensation plans (including individual compensation arrangements) under which securities of URON Inc. were then authorized for issuance.
 
   
Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights
 
Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights
 
Number of Securities Remaining Available for Issuance Under Equity Compensation Plans (excluding securities reflected in column a)
 
   
(a)
 
(b)
 
(c)
 
Equity compensation plans approved by securityholders
   
0
   
0
   
0
 
Equity compensation plans not approved by securityholders (1)
   
2,000,000
 
 
$
0.01
   
None
(2)
 

(1)
The Company is not required by applicable state law or the listing standards of any self-regulatory agency (e.g., the OTC Bulletin Board, NASD, AMEX or NYSE) to obtain the approval of its securityholders prior to issuing any such compensatory options, warrants or other rights to purchase securities of the Company.

(2)
In January 2008, the Company adopted the 2008 Stock Incentive Plan which permits the issuance of various incentives, including options or similar rights to purchase or acquire up to 2,000,000 shares of common stock. As of the date of this report, no incentives have been issued under such plan.

Recent Sales of Unregistered Securities

For sales of unregistered securities made by URON Inc. during the three-year period prior to this report, please refer to our quarterly reports on Form 10-QSB filed on September 11, 2006 (amended on January 12, 2007), November 14, 2006 (amended on January 12, 2007), May 16, 2007, August 15, 2007 and November 20, 2007; our annual report on Form 10-KSB filed on April 17, 2007; and our current reports on Form 8-K filed on January 7, 2008 and March 3, 2008; and all of such disclosures are hereby incorporated herein by this reference.

Description of Equity Securities

Our authorized capital stock consists of 250 million shares of capital stock, no par value per share (unless otherwise determined by the Board of Directors). All shares of common stock have equal voting rights and are entitled to one vote per share on all matters to be voted upon by our shareholders. Shares of our common stock have no preemptive, subscription, conversion or redemption rights and may be issued only as fully-paid and non-assessable shares. Cumulative voting in the election of directors is not permitted. In the event of our liquidation, each holder of our common stock is entitled to receive a proportionate share of our assets available for distribution to stockholders after the payment of liabilities. All shares of our common stock issued and outstanding are fully-paid and non-assessable.
 
16

 
Of our 250 million shares of authorized capital, we have designated 10,000,000 for issuance as “Series A Convertible Preferred Stock.” Each share of Series A Convertible Preferred Stock carries a $2.10 stated value and entitles its holders to (i) a cumulative 10% dividend, compounded and payable on a quarterly basis; (ii) in the event of a liquidation or dissolution of the Company, a preference in the amount of all accrued but unpaid dividends plus the stated value of such shares, before any payment shall be made or any assets distributed to the holders of any junior securities; (iii) convert their preferred shares into common shares of the Company on a share-for-share basis (subject to adjustment); and (iv) vote their preferred shares on an as-if-converted basis. The Company has the right to redeem some or all of such preferred shares, at any time upon 60 days’ advance notice, at a price dependent upon the date of redemption. In the case of any redemption closing on or prior to March 31, 2009, the redemption price will be $3.00 per share plus accrued but unpaid dividends; thereafter, the redemption price will $3.50 per share plus accrued but unpaid dividends. Holders of Series A Convertible Preferred Stock have no preemptive or cumulative-voting rights.

ITEM 6.
SELECTED FINANCIAL DATA.

Not applicable.

ITEM 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

Overview

Pursuant to the December 13, 2007 Merger Agreement, WFL Acquisition Corp. merged with and into Wyoming Financial Lenders, Inc., with Wyoming Financial Lenders remaining as the surviving entity and a wholly owned operating subsidiary of the Company. As indicated above, this transaction is referred to throughout this report as the “Merger.” The Merger was effective as of the close of business on December 31, 2007, by the filing of a certificate of merger with the Wyoming Secretary of State.

Since the Merger, the Company (through Wyoming Financial Lenders, Inc.) provides retail financial services to individuals in the mid-western United States. These services include non-recourse cash advance loans, check cashing and other money services. At the close of business on December 31, 2007, the Company owned and operated 52 stores in ten states (Colorado, Iowa, Kansas, Montana, Nebraska, North Dakota, South Dakota, Utah, Wisconsin and Wyoming). As of the date of this report, we owned and operated a total of 61 stores in the foregoing states and Arizona.

We provide short-term consumer loans, known as cash advance loans, in amounts that typically range from $100 to $500. Cash advance loans provide customers with cash in exchange for a promissory note with a maturity of generally two to four weeks and that customer’s post-dated personal check for the aggregate amount of the cash advanced, plus a fee. The fee varies from state to state, based on applicable regulations, and generally ranges from $15 to $20 per each $100 borrowed. To repay the cash advance loans, customers may pay with cash, in which case their personal check is returned to them, allow the check to be presented to the bank for collection, or pay by ACH direct payment. All of the Company’s loans and other services are subject to state regulations which vary from state to state, federal regulations and local regulation, where applicable.
 
17


Discussion of Critical Accounting Policies
 
Our consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States of America applied on a consistent basis. The preparation of these financial statements requires us to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We evaluate these estimates and assumptions on an ongoing basis. We base these estimates on the information currently available to us and on various other assumptions that we believe are reasonable under the circumstances. Actual results could vary materially from these estimates under different assumptions or conditions.
 
Our significant accounting policies are discussed in Note 1, Nature of Business and Summary of Significant Accounting Policies, of the Notes to the Consolidated Financial Statements included in Item 8 of this Form 10-K.
 
We believe that the following critical accounting policies affect the more significant estimates and assumptions used in the preparation of our consolidated financial statements.
 
Loan Loss Allowance
 
We maintain a loan loss allowance for anticipated losses for our cash advance loans. To estimate the appropriate level of loan loss allowances, we consider the amount of outstanding loans owed to us, historical loans charged off, current and expected collection patterns and current economic trends. Our current loan loss allowance is based on our net write offs, typically expressed as a percentage of loan amounts originated for the last twelve months applied against the principal balance of outstanding loans that we write off. As conditions change, we may need to make additional allowances in future periods.
 
When a loan is originated, the customer receives the cash proceeds in exchange for a post-dated check or a written authorization to initiate a charge to the customer's bank account on the stated maturity date of the loan. If the check or the debit to the customer's account is returned from the bank unpaid, the loan is placed in default status and an allowance for this defaulted loan receivable is established and charged against expense in the period that the loan is placed in default status. This allowance is reviewed monthly and any adjustment to the loan loss allowance as a result of historical loan performance, current and expected collection patterns and current economic trends is recorded. Returned items, net of allowance, was $375,000 and $298,000 at December 31, 2007 and 2006, respectively.
 
Valuation of long-lived and Intangible Assets

The Company assesses the impairment of long-lived and intangible assets whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors that could trigger an impairment review include significant underperformance relative to expected historical or projected future cash flows, significant changes in the manner of use of acquired assets or the strategy for the overall business, and significant negative industry trends. When management determines that the carrying value of long-lived and intangible assets may not be recoverable, impairment is measured based on the excess of the assets' carrying value over the estimated fair value.
 
Share-Based Compensation
 
Under the fair value recognition provisions of Financial Accounting Standards Board Statement No. 123R (SFAS 123R), “Share-Based Payment”, our share-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense based on the applicable vesting schedule. Determining the fair value of share-based awards at grant date requires judgment, which includes estimating the amount of share-based awards expected to be forfeited. The Black-Scholes option pricing model (using estimated value of URON Inc.) is used to measure fair value for stock option grants.
 
During 2007, we granted 1,600,000 shares of restricted stock options and warrants to certain employees and non employees of the Company. These options and warrants vested upon the successful completion of the Company’s merger on December 31, 2007. We estimated that the grant date fair market value of these restricted options totaled $368,000 at the time of issuance and $1,248,000 at the time of exercise in January 2008. During 2007, we granted warrants to an adviser to the Company for the purchase of up to 400,000 shares. These warrants vested upon the successful completion of the Company’s merger on December 31, 2007. We estimated that the grant date fair market value of these restricted warrants totaled $92,000 at the time of issuance. These warrants have not been exercised as of the date of this report.
 
 
18


Results of Operations

Net Income. For the year ended December 31, 2007, net income was $.03 million compared to net income of $1.37 million in 2006. A discussion of the various components of net income follows.

Revenues. Revenues totaled $11.35 million in 2007 compared to $8.72 million in 2006, an increase of $2.63 million or 30.1%. The increase in revenues was primarily a result of higher cash advance loan volumes resulting from an increase in the number of stores and customer transactions. We originated approximately $62 million in cash advance loans during 2007 compared to $47 million during the prior year. The average loan (including fee) totaled $322 in 2007 versus $335 in the prior year. Our average fee rate for 2007 was $47.51 compared to $49.03 in 2006. Revenues from check cashing, title loans, guaranteed phone/Cricket fees, and other sources totaled $2.24 million and $1.82 million for 2007 and 2006, respectively.

Salaries and Benefits. Payroll and related costs were $3.75 million in 2007 compared to $2.98 million in 2006 an increase of $.77 million, as headcount increased mostly due to an increase in the number of branch locations and corporate positions.

Provisions for Loan Losses. Our provision for losses for 2007 totaled $1.48 million and $.88 million for 2006. The less favorable loss ratio year to year reflects our accelerated rate of unit store growth during 2007, and a more challenging collections environment as a result of an increase in bankruptcy filings, higher energy prices and increased competition in the lending industry.

Guaranteed phone/Cricket. Guaranteed phone/Cricket dropped to $.44 million in 2007 compared to $.59 million in 2006. The decrease was a result of lower guaranteed phone/Cricket revenue due to a national trend of more consumers relying on cellular phones versus home phones where the guaranteed phone product is used.

Occupancy Costs. Occupancy expenses, consisting primarily of store leases were $.78 million during 2007, compared to $.45 million in 2006, an increase of $.33 million due to the addition of stores during 2007. Occupancy expenses as a percentage of revenues increased from 5.2 % in 2006 to 6.9% in 2007, primarily due to the high number of stores many of which were opened recently and had lower profitability compared to the more mature locations.
 
19


Advertising. Advertising and marketing related expense was $.42 million in 2007 compared to $.38 million in 2006 due primarily to the greater number of stores operating in 2007.

Depreciation. Depreciation increased by $.03 million in 2007 due to depreciation associated with capital expenditures for stores. Depreciation was $.14 million for 2007 and $.11 million for 2006.

Amortization of Intangible Assets. Amortization of intangible assets was $.14 million for both 2007 and 2006.
 
Stock-Based Compensation Expense. The Company incurred stock-based compensation expense related to employee stock options and warrants issued in conjunction with the Merger and were $.46 million in 2007.

Merger Transaction Expenses.  Expenses related to the Company’s Merger were $1.4 million in 2007.
 
General, Administrative and Other. Total other costs for the year ended December 31, 2007 were $1.41 million compared to $.99 million in 2006. Other costs, which include, utilities, and office supplies collection costs and other minor costs increased by $.42 million primarily due to growth in number of stores.

Total Operating Expenses. Total operating expenses for the year ended December 31, 2007 were $10.42 million compared to $6.52 million for 2006. The $3.90 million, or 59.82% increase in operating expenses over the comparable period in 2006, was due primarily to the increased amount of transactions, expansion of our business with additional stores, expenses related to the Merger transaction and stock-based compensation expense.

Income From Operations. Income from operations as a result of the above factors was $.93 million compared income of $2.20 million in 2006.
 
Income Tax Expense. Income tax expense was $.90 million in 2007 compared to income tax expense of $.83 million in 2006 primarily as a result of 2007 Merger-related nondeductible permanent differences.

Net Income. Net income in 2007 was $.03 million in 2007 compared to net income of $1.37 million in 2006, a decrease in net income of $1.34 million.

Liquidity and Capital Resources

At December 31, 2007, we had cash of $.98 million compared to $1.27 million at December 31, 2006. Cash decreased by $.28 million during fiscal 2007 and cash increased by $.34 million during fiscal 2006. For fiscal year 2008, we believe that our available cash, combined with expected cash flows from operations and collections of stock subscriptions receivable, will be sufficient to fund our liquidity and capital expenditure requirements during fiscal 2008.

Net cash provided by operating activities was $1.91 million in 2007 and $2.55 million in 2006. Operating cash flows from 2006 to 2007 were lower due a larger net growth in loans receivable (i.e., growth in loans receivable less allowance for losses) and changes to deferred income taxes due to a change in 2007 in the Company’s method of accounting for late loans receivable for income tax reporting. Net cash used by investing activities was $.15 million in 2007 and $5.50 million in 2006. Investing activities consisted of store acquisitions and improvements. Net cash used by financing activities was $2.04 million in 2007 versus net cash used by financing activities of $3.29 million in 2006. In 2006, financing activities included stockholder’s contribution of $4.20 million. Dividends paid were $1.59 million and $.91 million in 2007 and 2006, respectively. Payments of notes payable in 2007 were $.53 million.
20

 
Off-Balance Sheet Arrangements

The Company has no off-balance sheet arrangements.

ITEM 7A.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.
 
21


ITEM 8.
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
 
Financial Statements

The following consolidated financial statements, and related notes thereto, and the related Report of Independent Registered Public Accounting Firm are filed as part of this Annual Report on Form 10-K:
 
Index to Financial Information
 
CONTENTS

   
Page(s)
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
F-2
     
CONSOLIDATED FINANCIAL STATEMENTS
   
     
Consolidated Balance Sheets
 
F-3
     
Consolidated Statements of Income
 
F-4
     
Consolidated Statements of Stockholders’ Equity
 
F-5
     
Consolidated Statements of Cash Flows
 
F-6
     
Notes to Consolidated Financial Statements
 
F-7- F-19
 
F-1


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board Directors
URON Inc.
Council Bluffs, Iowa

We have audited the accompanying consolidated balance sheets of URON Inc. and Subsidiary as of December 31, 2007 and 2006, and the related consolidated statements of income, stockholders’ equity, and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of URON Inc. and Subsidiary as of December 31, 2007 and 2006, and the results of their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.


/s/Lurie Besikof Lapidus & Company, LLP
Minneapolis, Minnesota

April 2, 2008
 
F-2

 
URON INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

   
December 31,
 
ASSETS
 
2007
 
2006
 
CURRENT ASSETS
           
Cash
 
$
984,625
 
$
1,265,460
 
Loans receivable, less allowance for doubtful
accounts of $976,000 and $762,000
   
4,117,497
   
3,884,807
 
Stock subscriptions receivable, subsequently collected
   
4,422,300
   
-
 
Prepaid expenses and other
   
92,333
   
166,988
 
Deferred income taxes
   
526,000
   
394,000
 
TOTAL CURRENT ASSETS
   
10,142,755
   
5,711,255
 
               
PROPERTY AND EQUIPMENT
   
631,736
   
656,606
 
               
GOODWILL
   
9,883,659
   
9,883,659
 
               
INTANGIBLE ASSETS
   
90,926
   
227,333
 
               
OTHER
   
167,000
   
-
 
               
TOTAL ASSETS
 
$
20,916,076
 
$
16,478,853
 
               
LIABILITIES AND STOCKHOLDERS’ EQUITY
             
CURRENT LIABILITIES
             
Accounts payable and accrued liabilities
 
$
1,908,844
 
$
496,769
 
Accounts payable - related parties
   
950,935
   
-
 
Deferred revenue
   
262,357
   
250,133
 
Notes payable
   
-
   
530,000
 
TOTAL CURRENT LIABILITIES
   
3,122,136
   
1,276,902
 
               
DEFERRED INCOME TAXES
   
545,000
   
675,000
 
               
TOTAL LIABILITIES
   
3,667,136
   
1,951,902
 
               
STOCKHOLDERS’ EQUITY
             
Series A convertible preferred stock, 10% cumulative dividends,
$0.01 par value, $2.10 stated value, 10,000,000 shares authorized,
issued and outstanding
   
100,000
   
100,000
 
Common stock, no par value, 10,000,000 shares authorized,
6,299,753 and 1,125,000 shares issued and outstanding
             
Additional paid-in capital
   
17,639,318
   
13,358,158
 
Retained earnings (deficit)
   
(490,378
)
 
1,068,793
 
     
17,248,940
   
14,526,951
 
               
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
 
$
20,916,076
 
$
16,478,853
 

See notes to consolidated financial statements.

F-3

 
URON INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF INCOME

   
Year Ended December 31,
 
   
2007
 
2006
 
             
REVENUES
           
Loan fees
 
$
9,104,545
 
$
6,898,554
 
Check cashing fees
   
1,333,123
   
817,379
 
Guaranteed phone/Cricket fees
   
749,475
   
889,778
 
Other fees
   
159,381
   
114,127
 
     
11,346,524
   
8,719,838
 
               
OPERATING EXPENSES
             
Salaries and benefits
   
3,747,347
   
2,978,298
 
Provisions for loan losses
   
1,484,754
   
878,469
 
Guaranteed phone/Cricket
   
442,845
   
592,283
 
Occupancy
   
783,173
   
454,681
 
Advertising
   
421,265
   
376,077
 
Depreciation
   
140,638
   
111,320
 
Amortization of intangible assets
   
136,407
   
136,405
 
Stock-based compensation expense
   
460,000
   
-
 
Merger transaction expenses
   
1,391,024
   
-
 
General, administrative and other
   
1,407,827
   
992,444
 
     
10,415,280
   
6,519,977
 
               
INCOME FROM OPERATIONS
   
931,244
   
2,199,861
 
               
INCOME TAX EXPENSE
   
904,000
   
829,000
 
               
NET INCOME
   
27,244
   
1,370,861
 
               
ASSUMED SERIES A CONVERTIBLE PREFERRED STOCK DIVIDENDS
   
(2,100,000
)
 
(2,100,000
)
               
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS
 
$
(2,072,756
)
$
(729,139
)
               
NET LOSS PER COMMON SHARE -
             
Basic and diluted
 
$
(1.82
)
$
(0.65
)
               
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING -
             
Basic and diluted
   
1,139,177
   
1,125,000
 
               
 
See notes to consolidated financial statements.
 
F-4


URON INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
 
   
Series A
 
 
 
 
 
 
 
 
 
 
 
Convertible
 
Common
 
Additional
 
 
 
 
 
 
 
Preferred Stock
 
Stock
 
Paid-In
 
Retained
 
Stockholders’
 
 
 
Shares
 
Amount
 
Shares
 
Amount
 
Capital
 
Earnings
 
Equity
 
BALANCE - December 31, 2005
   
10,000,000
 
$
100,000
   
1,125,000
 
$
-
 
$
9,158,158
 
$
607,074
 
$
9,865,232
 
                                             
Equity contribution
   
-
   
-
   
-
   
-
   
4,200,000
   
-
   
4,200,000
 
Dividends
   
-
   
-
   
-
   
-
   
-
   
(909,142
)
 
(909,142
)
Net income
   
-
   
-
   
-
   
-
   
-
   
1,370,861
   
1,370,861
 
                                             
BALANCE - December 31, 2006
   
10,000,000
   
100,000
   
1,125,000
   
-
   
13,358,158
   
1,068,793
   
14,526,951
 
                                             
Common stock issued, net of $347,995 costs
   
-
   
-
   
4,403,544
   
-
   
4,150,005
   
-
   
4,150,005
 
Stock-based compensation
   
-
   
-
   
-
   
-
   
460,000
   
-
   
460,000
 
Reverse Merger Transaction:
                                           
Previously issued URON Inc. stock
   
-
   
-
   
771,209
   
-
   
369,919
   
(419,919
)
 
(50,000
)
Elimination of accumulated deficit
   
-
   
-
   
-
   
-
   
(419,919
)
 
419,919
   
-
 
Return of capital to WERCS
   
-
   
-
   
-
   
-
   
(278,845
)
 
-
   
(278,845
)
Dividends
   
-
   
-
   
-
   
-
   
-
   
(1,586,415
)
 
(1,586,415
)
Net income
   
-
   
-
   
-
   
-
   
-
   
27,244
   
27,244
 
                                             
BALANCE - December 31, 2007
   
10,000,000
 
$
100,000
   
6,299,753
 
$
-
 
$
17,639,318
 
$
(490,378
)
$
17,248,940
 
 
See notes to consolidated financial statements.
 
F-5

 
URON INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

   
Year Ended December 31,
 
   
2007
 
2006
 
OPERATING ACTIVITIES
           
Net income
 
$
27,244
 
$
1,370,861
 
Adjustments to reconcile net income to net cash provided by
operating activities:
             
Stock-based compensation
   
460,000
   
-
 
Depreciation
   
140,638
   
111,320
 
Amortization of intangible assets
   
136,407
   
136,405
 
Deferred income taxes
   
(262,000
)
 
198,000
 
Loss on disposal of property and equipment
   
25,979
   
-
 
Changes in operating assets and liabilities:
             
Loans receivable
   
(224,722
)
 
(11,940
)
Prepaid expenses and other
   
74,655
   
(88,405
)
Accounts payable and accrued liabilities
   
1,519,170
   
758,813
 
Deferred revenue
   
12,224
   
79,054
 
Net cash provided by operating activities
   
1,909,595
   
2,554,108
 
               
INVESTING ACTIVITIES
             
Purchases of property and equipment
   
(140,747
)
 
(219,355
)
Acquisition of stores, net of cash acquired
   
(8,968
)
 
(5,285,163
)
Net cash used by investing activities
   
(149,715
)
 
(5,504,518
)
               
FINANCING ACTIVITIES
             
Payments on notes payable
   
(530,000
)
 
-
 
Stock sales and equity contribution
   
75,700
   
4,200,000
 
Dividends
   
(1,586,415
)
 
(909,142
)
Net cash provided (used) by financing activities
   
(2,040,715
)
 
3,290,858
 
               
NET INCREASE (DECREASE) IN CASH
   
(280,835
)
 
340,448
 
               
CASH
             
Beginning of year
   
1,265,460
   
925,012
 
               
End of year
 
$
984,625
 
$
1,265,460
 
               
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
             
               
Cash paid (primarily to WERCS) for income taxes
 
$
1,176,044 
 
$
620,956
 
               
Noncash investing and financing activities:
             
Stock sold on subscriptions - uncollected
 
$
4,422,300
 
$
-
 
Cost of raised capital in accounts payable
   
347,995
   
-
 
Return of capital to WERCS in accounts payable
   
278,845
   
-
 
Other assets in accounts payable
   
167,000
   
-
 
Reverse merger of URON Inc.
   
50,000
   
-
 
 
See notes to consolidated financial statements.
 
F-6

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.
Nature of Business and Summary of Significant Accounting Policies -

Nature of Business/ Basis of Presentation

URON Inc. (URON) through its wholly owned operating subsidiary, Wyoming Financial Lenders, Inc. (WFL), collectively referred to as the Company, provides retail financial services to individuals in the Midwestern United States. These services include non-recourse cash advance loans, check cashing and other money services. The Company also is a non-recourse reseller of guaranteed phone service and Cricket cellular phones. As of December 31, 2007, the Company operated 52 stores in 10 states (Nebraska, Wyoming, Utah, Iowa, North Dakota, South Dakota, Kansas, Wisconsin, Montana and Colorado). As of December 31, 2006, Company operated in 55 stores in 10 states. The consolidated financial statements include the accounts of URON and WFL. All significant intercompany balances and transactions have been eliminated in consolidation.

The Company provides short-term consumer loans, known as cash advance loans, in amounts that typically range from $100 to $500. Cash advance loans provide customers with cash in exchange for a promissory note with a maturity of generally two to four weeks and the customer’s personal check for the aggregate amount of the cash advanced plus a fee. The fee varies from state to state, based on applicable regulations and generally ranges from $15 to $20 per each $100 borrowed. To repay the cash advance loans, customers may pay with cash, in which their personal check is returned to them, allowing their check to be presented to the bank for collection, or by ACH direct payment.

The Company also provides ancillary consumer financial products and services that are complementary to its cash advance-lending business, such as check-cashing services, money transfers and money orders. We also offer guaranteed phone/Cricket™ phones to our customers.

Our loans and other services are subject to state regulations (which vary from state to state) and federal and local regulations, where applicable.

Pursuant to an Agreement and Plan of Merger and Reorganization dated December 13, 2007 (Merger Agreement), by and among URON, WFL Acquisition Corp., a Wyoming corporation and wholly owned subsidiary of the URON, and WFL, WFL Acquisition Corp. merged with and into WFL, with WFL remaining as the surviving entity and a wholly owned operating subsidiary of the URON. This transaction is referred to throughout this report as the “Merger” (Note 2).

As a result of the Merger, WERCS, a Wyoming corporation and the former sole stockholder of WFL, received: (i) 1,125,000 shares of the URON’s common stock, and (ii) 10,000,000 shares of Series A Convertible Preferred Stock. On an aggregate and as-if-converted basis, WERCS received 11,125,000 common shares representing approximately 68% of the Company’s outstanding common stock after the Merger. In addition, WERCS received a $278,845 return of capital for excess assets at the Merger date as defined in the Merger Agreement.
 
(continued)
 
F-7

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.
Nature of Business and Summary of Significant Accounting Policies - (continued)

Nature of Business/ Basis of Presentation - (continued)

The consolidated financial statements account for the Merger as a capital transaction in substance (and not a business combination of two operating entities) that would be equivalent to WFL issuing securities to URON in exchange for the net monetary liabilities of URON, accompanied by a recapitalization and, as a result, no goodwill relating to the Merger has been recorded.

Prior to the Merger, URON effected a 1-for-10 share combination (i.e., reverse stock split) of its capital stock, and corresponding reduction in the number of shares of authorized capital, effective as of December 27, 2007. All share and per share information included in these consolidated financial statements give effect for the 1-for-10 share combination.

Use of Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that may affect certain reported amounts and disclosures in the consolidated financial statements and accompanying notes. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from those estimates. Significant management estimates relate to the allowance for loans receivable, allocation of and carrying value of goodwill and intangible assets, value associated with stock-based compensation, and deferred taxes and tax uncertainties.

Revenue Recognition

The Company recognizes fees on cash advance loans on a constant-yield basis ratably over the loans’ terms. The Company records fees derived from check cashing, guaranteed phone/Cricket fees, and all other services in the period in which the service is provided.

Loans Receivable

In addition to loans receivable that are currently due, loans receivable also include cash advance loans that have not been repaid, where the customer’s personal check has been deposited and the check has been returned due to non-sufficient funds in the customer’s account, closed accounts, or other reasons. Loans receivable are carried at cost less the allowance for doubtful accounts.

The Company does not specifically reserve for any individual loan. The Company aggregates cash advance loans for purposes of estimating the loss allowance using a methodology that analyzes portfolio statistics and management’s judgment regarding recent trends noted in the portfolio. This methodology takes into account several factors, including the maturity of the store location and charge-off and recovery rates.

(continued)
 
F-8

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.
Nature of Business and Summary of Significant Accounting Policies - (continued)

Loans Receivable - (continued)

When a bank returns a customer’s check, the account is recognized as a returned item receivable and is included in loans receivable. All returned items are charged off after 180 days, as collections after that date are not significant. Returned items receivable, net of allowances, were approximately $375,000 and $298,000 at December 31, 2007 and 2006, respectively.

Property and Equipment

Property and equipment are recorded at cost less accumulated depreciation. Depreciation is provided on the straight-line method over the estimated useful lives of the related assets. Useful lives range from five to seven years for furniture, equipment, and vehicles. Leasehold improvements are amortized using the straight-line method over the lesser of the estimated useful lives of the related assets or the leases term, and this amortization is included with depreciation.

Goodwill

Goodwill represents the excess of cost over the fair value of net assets acquired using purchase accounting and is not amortized.

Intangible Assets

Customer relationships represent the fair values assigned to relationships with customers acquired through business acquisitions and is amortized over three years.

Long- Lived Assets

Goodwill is reviewed, at least annually, for impairment. Property and equipment and customer relationships are reviewed for impairment when events or changes in circumstances indicate that the carrying amounts may not be recoverable. An impairment loss is recognized when the fair value of the asset is less than the carrying value of the asset.

Concentrations of Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist of cash and loans receivable. The Company’s cash is placed with high quality financial institutions. From time to time, cash balances exceed federally insured limits. The Company has not experienced any significant losses with respect to its cash. Loans receivable, while concentrated in geographical areas, are dispersed among numerous customers.

(continued)
 
F-9

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
1.
Nature of Business and Summary of Significant Accounting Policies - (continued)

Income Taxes

Deferred income taxes reflect the tax consequences in future years of differences between the tax basis of assets and liabilities and their financial reporting amounts, based on enacted tax laws and statutory tax rates applicable in the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. The provision for income taxes represents taxes paid or payable for the current year and changes during the year in deferred tax assets and liabilities.

Net Loss Per Common Share

Basic net loss per common share is computed by dividing the loss available to common shareholders by the weighted average number of common shares outstanding for the year. Diluted net loss per common share is computed by dividing the net loss available to common shareholders’ by the sum of the weighted average number of common shares outstanding plus potentially dilutive common share equivalents (stock options, stock warrants, convertible preferred shares) when dilutive. The following potentially dilutive securities were anti-dilutive and therefore excluded from the dilutive net loss per share computation:
       
       
Series A Convertible Preferred Stock
   
10,000,000
 
Stock options (issued in 2007)
   
1,575,000
 
Stock warrants (issued in 2007)
   
425,000
 
         
     
12,000,000
 
 
Fair Value of Financial Instruments

The amounts reported in the balance sheets for cash, loans receivable, stock subscriptions receivable notes payable, and accounts payable are short-term in nature and their carrying values approximate fair values.

Recent Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards (SFAS) No. 157, “Fair Value Measurements (as amended),” which defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosure about fair value measurements. SFAS No. 157 applies whenever other standards require (or permit) assets or liabilities to be measured at fair value, and therefore, does not expand the use of fair value in any new circumstances. The effective date of this standard was for all full fiscal and interim periods beginning after November 15, 2007. On December 14, 2007, the FASB issued Staff Position FAS 157-b, which deferred the effective date of SFAS No. 157 for one year, as it relates to nonfinancial assets and liabilities. The Company is evaluating the impact the adoption of SFAS No. 157 will have on our financial position or results of operations.

(continued)
 
F-10

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
1.
Nature of Business and Summary of Significant Accounting Policies - (continued)

Recent Accounting Pronouncements - (continued)

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities (as amended), Including an Amendment of FASB Statement No. 115,” which permits entities to measure eligible financial assets, financial liabilities and firm commitments at fair value, on an instrument-by-instrument basis, that are otherwise not permitted to be accounted for at fair value under other generally accepted accounting principles. The fair value measurement election is irrevocable and subsequent changes in fair value must be recorded in earnings. SFAS No. 159 will be effective for the Company beginning in fiscal 2008. The Company is evaluating the impact the adoption of SFAS No. 159 will have on our financial position or results of operations.

In December 2007, FASB issued SFAS No. 141 (revised 2007), “Business Combinations”. SFAS No. 141R significantly changes the accounting for business combinations in a number of areas including the treatment of contingent consideration, preacquisition contingencies, transaction costs, in-process research and development and restructuring costs. In addition, under SFAS No. 141R, changes in an acquired entity’s deferred tax assets and uncertain tax positions after the measurement period will impact income tax expense. SFAS No. 141R is effective for fiscal years beginning after December 15, 2008. This standard will change our accounting treatment for business combinations on a prospective basis.

In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51.” SFAS No. 160 changes the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interest and classified as a component of equity. This new consolidation method significantly changes the accounting for transactions with minority interests holders. SFAS No. 160 is effective for fiscal years beginning after December 15, 2008. We are evaluating the impact the adoption of SFAS No. 160 will have on our financial position or result of operations.

2.
Merger -

The following is a summary of the significant Merger-related transactions:

In contemplation of the Merger, URON entered into a subscription agreement with the Company’s Chief Executive Officer (CEO). Under the agreement, the CEO purchased 1,071,875 shares of URON common stock for an aggregate purchase price of $500,000. At December 31, 2007, the purchase price was included in subscriptions receivable and has since been collected.

In contemplation of the Merger, URON entered into various stock option agreements with executive and non-executive management personnel. In addition, URON granted stock warrants to certain other parties. In total, URON granted stock options and warrants to eleven parties, to purchase an aggregate of 1,600,000 shares of common stock at the per-share price of $0.01. These options and warrants include 550,000 issued to the Company’s Chief Financial Officer (CFO) and 400,000 issued to the Company’s Chief Operating Officer (COO).

(continued)
 
F-11


URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
2.
Merger - (continued)

URON issued a warrant to Lantern Advisors, LLC for the purchase of up to 400,000 shares of common stock at the per-share price of $0.01 for professional services.

The Company assumed $50,000 of liabilities of URON.

The Company was responsible for certain fees to various brokers, advisors and others for expenses related to the Merger.

In contemplation of the Merger, URON entered into subscription agreements to sell 3,331,669 shares of its common stock for an aggregate purchase price of $3,998,000. As of December 31, 2007, $75,700 of the subscriptions receivable were collected and the remaining amount has since been collected. Expenses incurred related to the issuance of these shares were $347,995.

WERCS, the former sole owner of WFL common stock, received an aggregate of 1,125,000 shares of URON’s common stock and 10,000,000 shares of URON Series A Convertible Preferred Stock.

3.
Acquisitions -

In 2007 and 2006, the Company purchased the assets of various stores in separate transactions. The aggregate purchase price totaled $10,849 in 2007 and $5,473,600 in 2006.

Under the purchase method of accounting the assets and liabilities of the acquisitions were recorded at their respective fair values as of the purchase date as follows:

   
Year Ended December 31,
 
   
2007
 
2006
 
             
Cash
 
$
1,881
 
$
188,437
 
Loans receivable
   
7,968
   
1,274,611
 
Other current assets
   
-
   
1,200
 
Property and equipment
   
1,000
   
273,148
 
Goodwill
   
-
   
3,792,009
 
Current liabilities
   
-
   
(55,805
)
               
   
$
10,849
 
$
5,473,600
 
 
(continued)
 
F-12

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
3.
Acquisitions - (continued)

The results of the operations for the acquired locations have been included in the financial statements since the date of the acquisitions. The following table presents the unaudited pro forma results of operations for the years ended December 31, 2007 and 2006, as if these acquisitions had been consummated at the beginning of each year presented. The unaudited pro forma results of operations are prepared for comparative purposes only and do not necessarily reflect the results that would have occurred had the acquisition occurred at the beginning of the year presented or the results which may occur in the future.

   
Year Ended December 31,
 
   
2007
 
2006
 
   
(unaudited)
 
(unaudited)
 
Pro forma revenue
 
$
11,466,524
 
$
11,466,524
 
Pro forma net income
   
51,244
   
1,802,580
 
Net loss per common share - basic and diluted
   
(1.80
)  
(0.26
)

4.
Property and Equipment -

Property and equipment consisted of the following:

   
December 31,
 
   
2007
 
2006
 
             
Furniture and equipment
 
$
553,714
 
$
590,275
 
Leasehold improvements
   
400,931
   
396,267
 
Vehicles
   
62,160
   
55,410
 
     
1,016,805
   
1,041,952
 
Less accumulated depreciation
   
385,069
   
385,346
 
               
   
$
631,736
 
$
656,606
 
 
5.
Intangible Assets -

Intangible assets consisted of the follows:

   
December 31,
 
   
2007
 
 2006
 
            
Customer relationships
 
$
451,974
 
$
451,974
 
Less accumulated amortization
   
361,048
   
224,641
 
               
   
$
90,926
 
$
227,333
 

Future amortization of intangible assets will be $90,926 in 2008.
 
F-13

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
6.
Income Taxes -

Prior to the Merger, the Company operated under an informal tax allocation agreement with WERCS, which required the Company to pay its fair share of its income taxes as if the Company were a stand-alone entity.

The Company’s provision for income taxes is as follows: 
 
   
Year Ended December 31,
 
   
2007
 
2006
 
Current:
           
Federal
 
$
996,000
 
$
539,000
 
State
   
170,000
   
92,000
 
     
1,166,000
   
631,000
 
Deferred:
             
Federal
   
(178,000
)
 
210,000
 
State
   
(84,000
)
 
(12,000
)
     
(262,000
)
 
198,000
 
               
   
$
904,000
 
$
829,000
 

Deferred income tax assets (liabilities) are summarized as follows:

   
December 31,
 
   
2007
 
2006
 
   
 Current
 
Noncurrent
 
 Current
 
Noncurrent
 
Deferred income tax assets
                     
Allowance for loans receivable
 
$
367,000
 
$
-
 
$
287,000
 
$
-
 
Deferred revenue
   
-
   
-
   
94,000
   
-
 
Stock-based compensation
   
137,000
   
-
   
-
   
-
 
Other
   
22,000
   
-
   
13,000
   
-
 
     
526,000
   
-
   
394,000
   
-
 
Deferred income tax liabilities
                         
Late loans receivable
   
-
   
-
   
-
   
(366,000
)
Property and equipment
   
-
   
(25,000
)
 
-
   
(2,000
)
Goodwill and intangible assets
   
-
   
(520,000
)
 
-
   
(307,000
)
   
     -    
(545,000
)
 
-
   
(675,000
)
                           
Net
 
$
526,000
 
$
(545,000
)
$
394,000
 
$
(675,000
)

In 2007, the Company changed its income tax reporting method of accounting for late loans receivable and deferred revenue.


(continued)
 
F-14

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

6.
Income Taxes - (continued)

Reconciliations from the statutory federal income tax rate to the effective income tax rate are as follows:

   
Year Ended December 31,
 
   
2007
 
2006
 
             
Income tax expense using the statutory federal rate
 
$
316,600
 
$
747,800
 
State income taxes, net of federal benefit
   
33,800
   
80,100
 
Permanent differences, primarily merger  transaction expenses
   
553,600
   
1,100
 
               
Income tax expense
 
$
904,000
 
$
829,000
 

The Company adopted the provisions of FASB Interpretation No. 48 (FIN No. 48), “Accounting for Uncertainty in Income Taxes - an Interpretation No. 109”, on January 1, 2007. Previously, the Company had accounted for tax contingencies in accordance with SFAS No. 5, “Accounting for Contingencies.” As required by FIN No. 48, the Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position. For tax positions meeting the more likely than not threshold, the amount recognized in the consolidated financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. At the adoption date, the Company applied FIN No. 48 to all tax positions for which the statute of limitations remained open. The adoption of FIN No. 48 did not have a material impact on the consolidated financial statements.

It is the Company’s practice to recognize penalties and/or interest related to income tax matters in interest and penalties expense. As of December 31, 2007, the Company had an immaterial amount of accrued interest and penalties.

The Company is subject to income taxes in the U.S. federal jurisdiction and various states and local jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to U.S. federal, state, or local income tax examinations by tax authorities for the years before 2004. The Company is not currently under examination by any taxing jurisdiction.

7.
Stockholders’ Equity -

Capitalization

At December 31, 2007, the Company’s authorized capital stock consists of 20,000,000 shares of no par value capital stock. All shares have equal voting rights and are entitled to one vote per share.

(continued)
 
F-15

 
URON INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.
Stockholders’ Equity - (continued)

Capitalization - (continued)

Of the 20,000,000 shares of authorized capital, 10,000,000 have been designated as common stock and 10,000,000 as Series A Convertible Preferred Stock. The Series A Convertible Preferred Stock has a 10% cumulative dividend and can be converted on a share-for-share basis into common stock. The Company has the right to redeem some or all of the Series A Convertible Preferred Stock at any time, upon 60 days notice, at $3.00 per share prior to April 1, 2009, or $3.50 per share afterwards, plus any cumulative unpaid dividends.

Stock Options and Warrants

No stock options or stock warrants were granted by the Company prior to 2007. In 2007, stock option and stock warrants were granted in connection with the Merger, became immediately exercisable with the Merger, and had a grant date fair value of $0.23. The Company intends to issue new shares upon exercise of stock option and warrants.

Stock options and stock warrants outstanding at December 31, 2007, consisted of the following: 
 
     
Stock Options
   
Stock Warrants
 
Exercise price
 
$
0.01
 
$
0.01
 
Units outstanding
   
1,575,000
   
425,000
 
Remaining contractual life
   
1 year
   
1 year
 
               
The aggregate intrinsic value of all vested options and warrants at December 31, 2007 is approximately $8 million.

Stock options and stock warrants activity for 2007 consisted of the following: 
 
   
Stock Options
 
Stock Warrants
 
Outstanding, December 31, 2006
   
-
   
-
 
Granted
   
1,575,000
   
425,000
 
Exercised
   
-
   
-
 
               
Outstanding, December 31, 2007
   
1,575,000
   
425,000
 

The fair value of stock options and stock warrants is estimated using the Black-Scholes-Merton option pricing model (using estimated value of URON) with the following weighted average assumptions:
 
Description
   
Assumption
 
         
Risk-free interest rate
   
3.14
%
Expected life
   
0.50 years
 
Expected volatility
   
247.00
%
Expected dividend rate
   
0.00
%

F-16

 
URON INC. AND SUBSIDIARY
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
8.
Operating Lease Commitments -

The Company leases its facilities under operating leases with terms ranging from three to five years, with rights to extend for additional periods. Rent expense was approximately $757,000 and $455,000 in 2007 and 2006 respectively. Future minimum lease payments are approximately as follows:  
 
Year Ending December 31,
   
Amount
 
2008
 
$
470,000
 
2009
   
363,000
 
2010
   
219,000
 
2011
   
131,000
 
2012
   
48,000
 
 
       
 
 
$
1,231,000
 
 
9.
Related Party Transactions -

At December 31, 2007, accounts payable included approximately $401,000 payable to the Company’s CEO for reimbursement of Merger and equity transaction related costs and $550,000 payable to WERCS for merger transaction related costs and return of capital.

The Company leases two properties from an officer of the Company and another related party under operating leases that extend through 2011 requiring monthly lease payments of $2,400.

10.
Employee Savings Plan -

The Company began a defined contribution retirement plan in 2007 intended to be qualified under Section 401(k) of the Internal Revenue Code. All employees are eligible to participate in the Plan after approximately one year of employment. The Plan allows each participant to make elective contributions subject to statutory limits. The Company matches employee contributions up to 100 % of the first 5% of the participating employees’ annual compensation. Company matching contributions to the Plan were approximately $32,000 in 2007.

11.
Risks Inherent in the Operating Environment -

The Company’s short-term consumer loan activities are regulated under numerous local, state, and federal laws and regulations, which are subject to change. New laws or regulations could be enacted that could have a negative impact on the Company’s lending activities. Over the past few years, consumer advocacy groups and certain media reports have advocated governmental and regulatory action to prohibit or severely restrict deferred presentment cash advances. If this negative characterization of deferred presentment cash advances becomes widely accepted by consumers, demand for deferred presentment cash advances could significantly decrease, which could have a materially adverse affect on the Company’s financial condition.

(continued)
 
F-17

 
URON INC. AND SUBSIDIARY
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
11.
Risks Inherent in the Operating Environment - (continued)

Negative perception of deferred presentment cash advances could also result in increased regulatory scrutiny and increased litigation and encourage restrictive local zoning rules, making it more difficult to obtain the government approvals necessary to continue operating existing stores or open new short-term consumer loan stores.

For the year ended December 31, 2007, the Company’s revenues by state in excess of 10% were approximately as follows:
 
State
   
% of Revenues
 
Iowa
   
12
%
Nebraska
   
36
%

12.
Subsequent Events -

2008 Stock Incentive Plan

On February 2, 2008, the Board of Directors of the Company approved and adopted the Company’s 2008 Stock Incentive Plan, pursuant to which an aggregated of 2,000,000 shares of common stock have been reserved for issuance.
 
Acquisition of National Cash & Credit

On February 26, 2008, the Company entered into an Exchange Agreement with National Cash & Credit, LLC, a Minnesota limited liability company (National Cash), and the members of National Cash. Under the Exchange Agreement, the members of National Cash assigned all of the outstanding membership interests in National Cash to the Company in exchange 1,114,891 shares of the Company’s common stock and a cash payment of $100,000. The Exchange Agreement contained customary representations, warranties and covenants of the parties and indemnification obligations.

The Company's CEO had a material financial interest in National Cash. The CEO’s ownership and conditions of the Exchange Agreement were disclosed to the Company's Board of Directors, which approved the Exchange Agreement.

National Cash was formed approximately two years ago and owned and operated five "payday" consumer loan stores located in suburban Phoenix, Arizona. National Cash principally offered short-term (i.e., five to 31 day) cash advance loans ranging from $100 to $2,500, and title loans ranging from $500 to $2,000. As of December 31, 2007, National Cash had approximately $840,000 in aggregate outstanding principal amount of cash advance and title loans.


(continued)
 
F-18

 
URON INC. AND SUBSIDIARY
 
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 
12.
Subsequent Events - (continued)

Acquisition of North Dakota Stores 

On March 1, 2008 the Company acquired, for $400,000, five stores offering payday advance loans in Fargo, Grand Forks, Bismarck, and Minot, North Dakota. These stores currently operate under the Ameri-Cash name.

Authorization of Additional Common Shares

On March 17, 2008, the stockholders approved an increase in the Company’s authorized shares to 250,000,000.

Dividend Declaration and Payment

On March 17, 2008, the Board of Directors of the Company approved the payment of the first quarter 2008 dividend on the Company's Series A Convertible Preferred Stock in the amount of $525,000. The dividends are to be paid on or before April 15, 2008.

Exercises of Options

In early 2008, 1,575,000 options were exercised for total proceeds of $15,750.
 
F-19

 
ITEM 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

Not applicable.

ITEM 9A(T).
CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

The Company carried out an evaluation, with the participation of our Chief Executive and Chief Financial Officers, of the effectiveness, as of December 31, 2007, of our disclosure controls and procedures, as defined in Rules 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effective in alerting them on a timely basis to material information required to be disclosed in our periodic reports to the SEC, and that there has been no significant change in such internal controls, or other factors, which could significantly affect such controls including any corrective actions with regard to significant deficiencies or material weaknesses, since our evaluation. Nevertheless, due to the limited number of Company employees engaged in the authorization, recording, processing and reporting of transactions, there is inherently a lack of segregation of duties. During the course of their audit of our consolidated financial statements for the fiscal year ended December 31, 2007, our independent registered public accounting firm, Lurie Besikof Lapidus & Company, LLP, advised management and the audit committee of our Board of Directors that they had identified a material weakness. The material weakness relates to the lack of segregation of duties within the financial processes in the Company. The Company periodically assesses the cost versus benefit of adding the resources that would remedy or mitigate this situation, and currently does not consider the benefits to outweigh the costs of adding additional staff in light of the limited number of transactions related to the Company’s operations.
 
Internal Control over Financial Reporting

In this filing, the Company is not providing a report of management on the Company’s internal controls over financial reporting. The reasons for this are primarily related to the Merger.

The Merger transaction was structured as a reverse triangular merger. In our reverse triangular merger, URON Inc. formed a subsidiary in the State of Wyoming which was named “WFL Acquisition Corp.” Then, once the Merger Agreement has been finally negotiated, URON Inc. and WFL Acquisition Corp. together signed the agreement with Wyoming Financial Lenders, Inc. When the Merger transaction contemplated by the Merger Agreement “closed” (that is, when the Merger actually occurred) at the close of business on December 31, 2007, the following legal transactions and events occurred:

 
(i)
WFL Acquisition Corp. merged with and into Wyoming Financial Lenders, Inc.;

 
(ii)
the separate legal existence of WFL Acquisition Corp. ceased;

 
(iii)
Wyoming Financial Lenders, Inc. survived the Merger;

 
(iv)
all shares of capital stock representing ownership of Wyoming Financial Lenders, Inc. were cancelled;

 
(v)
one new share of capital stock representing ownership of Wyoming Financial Lenders, Inc. was issued to URON Inc.; and

 
(vi)
URON Inc. issued shares of capital stock (both common and preferred) to the former owner of shares of Wyoming Financial Lenders, Inc.

The result of these transactions and events was that, as of the close of business on December 31, 2007, URON Inc. became the sole owner of Wyoming Financial Lenders, Inc. and its business, and WERCS (a Wyoming corporation and the former sole owner of Wyoming Financial Lenders, Inc.) came to possess voting and management control over URON Inc. through the stock issuance (see clause (vi) above) and the terms and conditions of the Merger Agreement pertaining to control of URON Inc.’s Board of Directors.

As a result of the foregoing facts and circumstances relating to the Merger, the Merger has been accounted for using reverse acquisition accounting principles. When reverse acquisition accounting principles apply, the historical financial statements of the reverse acquirer (in this case, Wyoming Financial Lenders, Inc.) replace those of the legal acquirer (in this case, URON Inc.).

Based on the foregoing, and based in particular on the fact that the financial statements and information relating to Wyoming Financial Lenders, Inc. constitute the financial statements and information of the “Company,” a meaningful evaluation of the effectiveness of internal controls as of December 31, 2007 would need to have been focused on the internal controls of Wyoming Financial Lenders, Inc. Because the Merger occurred on December 31, 2007, there was practically no substantive opportunity for the management of the Company to conduct an assessment of the effectiveness of the internal controls over financial reporting of Wyoming Financial Lenders, Inc. as of that same date.

Conversely, an evaluation of the internal controls of URON Inc. as of December 31, 2007, while possible, would not have been meaningful because of the application of reverse acquisition accounting to the Merger transaction, as explained above.
 
22


Because we have not conducted an assessment of management of the effectiveness of internal controls over financial reporting, nor included in this filing a report thereof, there is no corresponding attestation report of the Company’s registered public accounting firm. Furthermore, even if there had been such an assessment and report, no such attestation report would have been required for this filing under applicable temporary rules of the SEC.
 
The management of URON is responsible for establishing and maintaining adequate internal control over financial reporting. We anticipate that our internal control system will be designed to provide reasonable assurance to our management and Board of Directors regarding the preparation and fair presentation of published financial statements. The steps management expects to undertake include a top-down risk assessment of all risks associated over financial reporting and disclosure, the identification and ranking of risks and the corresponding financial accounts and business processes. Additionally, the associated system applications will be identified, as well the controls over information technology and general computer controls. Entity-wide controls will also be identified and documented. This control environment will be reviewed and assessed to allow management to conclude regarding the effectiveness of the design of the controls as well the operating effectiveness.

In making its assessment of internal control over financial reporting, management anticipates using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework .

All internal control over financial reporting, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention or overriding of controls. Therefore, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation and presentation. Further, because of changes in conditions, the effectiveness of internal controls over financial reporting may vary over time.

Thus far, the Company has retained the services of Hudson Financial Solutions, a Minneapolis-based business consulting specializing in audit, compliance, financial management and support. Hudson Financial Solution is preparing an outline of recommended action for management to be able to make its assessment and report in the Company’s Annual Report for the fiscal year ended December 31, 2008.

ITEM 9B.
OTHER INFORMATION.

Not applicable.

23

 

PART III

ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Management

At the effective time of the Merger, the Company’s Board of Directors was reconstituted by the appointment of Christopher Larson, Robert W. Moberly, James Mandel, John H. Klassen IV and Mark Houlton as directors, and the resignation of Donald Miller from his role as a director of the Company. The following table sets forth the name and position of each of the Company’s directors and executive officers after the Merger.

Name
 
Age
 
Positions
Christopher Larson
 
36
 
Director, Chief Executive Officer and President
Steven Staehr
 
45
 
Chief Financial Officer
John Quandahl
 
41
 
Chief Operating Officer
Robert W. Moberly
 
55
 
Director
James Mandel
 
50
 
Director
John H. Klassen IV
 
46
 
Director
Mark Houlton
 
43
 
Director

The biographies of those individuals currently serving as directors and executive officers of the Company are set forth below:

Chris Larson, the Company’s Chief Executive Officer and President, co-founded and acted as Chief Financial Officer of Cash Systems, Inc., a NASDAQ traded (symbol: CKNN) financial services company involved in the casino gaming industry, from 1999 to 2005. Chris also served on the Board of Directors of Cash Systems from 2001 to 2006. Cash Systems was taken public via a reverse merger and during Chris’ tenure the company experienced revenue growth from $600,000 to $120,000,000 annually.

Robert W. Moberly has been employed with WERCS since 1987. Mr. Moberly is responsible for locating and evaluating business acquisitions for WERCS and its affiliates. Mr. Moberly also develops the company’s business strategies. Mr. Moberly holds many licenses in insurance and securities, including: Property and Casualty, Life and Health, Surplus Lines in insurance and Registered Representative Series 7, Financial Operations Principal Series 27, General Principal Series 24, Municipal Securities Registered Representative Series 53 and Options Principal Series 4 in securities. Prior to joining Wyoming, Mr. Moberly worked for two years as a securities broker for Dain Bosworth and 15 years as the owner of a contracting business. Mr. Moberly, a native of Greybull, Wyoming, graduated from Worland High School and attended the University of Wyoming.

James Mandel has been the Chief Executive Officer and a director of Multiband Corporation (NasdaqCM: MBND) since October 1, 1998. He was co-founder of Call 4 Wireless, LLC, a telecommunications company specializing in wireless communications, and served as its Chairman and a member of its Board of Directors from December 1996 until October 1998, and as its interim Chief Executive Officer from December 1996 until December 1997. From October 1991 to October 1996, he was Vice President of Systems for Grand Casinos, Inc., where his duties included managing the design, development, installation and on-going maintenance for the 2,000 room, $507 million Stratosphere Hotel, Casino and Tower in Las Vegas. Mr. Mandel also managed the systems development of Grand Casino Mille Lacs, in Onamia, Minnesota, Grand Casino Hinckley in Hinckley, Minnesota and six other casinos nationwide. He formerly served as Chairman of the Board of Directors for CorVu Corporation, an international software development company which was sold in June of 2007, and currently serves as a director for NewMarket Technologies, an international technology company based in Dallas, Texas.
 
24


John H. Klaasen IV is a Business Financial Advisor with Merrill Lynch and provides advisory services for individuals, closely held businesses and public companies in a wide variety of industries. Prior to joining Merrill Lynch, Mr. Klassen worked in Wells Fargo’s Commercial Banking Group for 12 years. His has broad experience in the areas of commercial banking, investment banking and private wealth management. Mr. Klassen graduated magna cum laude with a Bachelor of Science degree in finance from San Diego State University. Mr. Klassen is active in a variety of community organizations.

Mark Houlton founded Houlton Enterprises, Inc. in 1997 and opened his first check-cashing / payday advance store in Omaha, Nebraska. Over the course of his ownership, this single store company grew to a total of 24 stores in Nebraska, Iowa, North Dakota and Wisconsin. In 2005, Mr. Houlton sold his stock to WERCS, Inc. and Houlton Enterprises was merged into Wyoming Financial Lenders, Inc. Mr. Houlton is a 1988 graduate of the University of Nebraska, Lincoln, having received a B.S. in management.

Steve Staehr is the Company’s Chief Financial Officer and was previously employed by Cash Systems, Inc. as its corporate controller, where he was responsible for all aspects of financial accounting and SEC reporting for the company. Mr. Staehr has also held high-level financial executive positions with several other large companies, most notably with Encore Productions, Inc., Mirage Resorts, Inc., Boyd Gaming Corporation, Caesars World, Inc., and Deloitte & Touche LLP. Mr. Staehr was the corporate controller for Boyd Gaming during its initial public offering. Mr. Staehr is a licensed certified public accountant in the states of California and Nevada, and a member of the American Institute of Certified Public Accountants.

John Quandahl, the Company’s Chief Operating Officer, currently also serves as the President of Wyoming Financial Lenders, Inc., a position he has held since 2007. From 2005 until joining Wyoming Financial Lenders, Mr. Quandahl was the President of Houlton Enterprises, Inc., and prior to that served as that corporation’s Chief Operating Officer from 1999 until 2004. Mr. Quandahl was the controller as Silverston Group, Inc., from 1993 until 1998, and before that began his career at the Nebraska Department of Revenue as a tax auditor in 1989. Mr. Quandahl is a certified public accountant and earned a degree in accounting from the University of Nebraska - Lincoln.

Under the Company’s bylaws, the directors serve for indefinite terms expiring upon the next annual meeting of the Company’s shareholders.

Family Relationships

The Board of Directors has affirmatively determined that there are no familial relationships among any of the Company’s officers or directors.

Involvement in Certain Legal Proceedings

During the past five years, no officer, director, control person or promoter of the Company has been involved in any legal proceedings respecting: (i) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (ii) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (iii) being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or (iv) being found by a court of competent jurisdiction (in a civil action), the commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated.
 
25


Committees of the Board of Directors

The Company does not have a standing nominating committee. Instead, the entire Board of Directors shares the responsibility of identifying potential director-nominees to serve on the Board of Directors.

The Board of Directors does have a standing compensation committee and audit committee. The compensation committee is composed of Messrs. Mandel, Houlton and Klaasen, with Mr. Houlton serving as the chairperson. The audit committee is composed of Messrs. Mandel, Houlton and Klaasen, with Mr. Mandel serving as the chairperson. The Board of Directors has determined that each of the members of compensation and audit committees are “independent,” as such term is defined in Section 4200(a)(15) of National Association of Securities Dealers’ listing standards, and meet the criteria for independence set forth in Rule 10A-3(b)(1) under the Exchange Act.

The Board of Directors has determined that at least one member of the audit committee, Mr. Mandel, is an “audit committee financial expert” as that term is defined in Regulation S-K promulgated under the Exchange Act. Mr. Mandel’s relevant experience is detailed in ITEM 10 above. As noted above, Mr. Mandel qualifies as an “independent director,” as such term is defined in Section 4200(a)(15) of National Association of Securities Dealers’ listing standards, and meets the criteria for independence set forth in Rule 10A-3(b)(1) under the Exchange Act. The Board of Directors has determined that each of the audit committee members is able to read and understand fundamental financial statements and that at least one member of the audit committee has past employment experience in finance or accounting.

Code of Ethics

We have adopted a Code of Ethics which governs the conduct of our officers, directors and employees in order to promote honesty, integrity, loyalty and the accuracy of our financial statements. You may obtain a copy of the Code of Ethics without charge by writing us and requesting a copy, attention: Christopher Larson, 2201 West Broadway, Suite 100, Council Bluffs, Iowa 51501. You may also request a copy by calling us at (712) 322-4020.

Compliance with Section 16(a) of the Exchange Act

Section 16(a) of the Securities Exchange Act of 1934 requires the Company’s officers, directors and persons considered to be beneficial owners of more than ten percent of a registered class of the Company’s equity securities to file reports of ownership and changes in ownership with the Securities and Exchange Commission and Nasdaq. Officers, directors and greater-than-ten-percent shareholders are required by SEC regulations to furnish the Company with copies of all Section 16(a) forms they file. Based solely on a review of the copies of such forms furnished to the Company, or written representations that no applicable filings were required, the Company believes that all such filings were filed on a timely basis for the fiscal year 2007.
 
26

 

ITEM 11.
EXECUTIVE COMPENSATION.

Summary Compensation Table
 
The following table sets forth the cash and non-cash compensation for awarded to or earned by (i) each individual who served as the principal executive officer of either URON Inc. or Wyoming Financial Lenders, Inc., during the year ended December 31, 2007, and (ii) each other individual that served as an executive officer of either URON Inc. or Wyoming Financial Lenders, Inc. at the conclusion of the year ended December 31, 2007 and who received in excess of $100,000 in the form of salary and bonus during such fiscal year. For purposes of this Annual Report, these individuals are collectively the “named executives” of the Company.
 
     
 Annual Compensation
   
 
     
Name and Principal Position
   
Year
   
Salary ($)
   
Bonus ($)
   
Other Annual Compensation ($)
   
Stock
Options
Awards ($) (5)
   
Stock
Awards ($)
John Quandahl, President and Chief Operating Officer (1)
   
2007
2006
   
229,000
70,350
   
0
0
   
0
0
  $
92,000
0
   
0
0
Christopher Larson, President and Chief Executive Officer (2)
   
2007
   
0
 
 
0
 
 
0
 
 
0
 
 
0
Donald Miller, President and Chief Executive Officer (3)
   
2007
2006
   
0
0
   
0
0
   
0
0
   
 
 
$
25,000
0
Steven Staehr, Chief Financial Officer (4) 
   
2007
   
0
 
 
0
 
 
0
 
$
126,500
 
 
0
 

(1)
Mr. Quandahl is the President of Wyoming Financial Lenders, Inc., the wholly owned and principal operating subsidiary of the registrant. Mr. Quandahl also began serving as the Chief Operating Officer of URON Inc. effective November 29, 2007, and continues to serve in that capacity since the Merger.

(2)
Mr. Larson became the President and Chief Executive Officer of URON Inc. effective November 29, 2007 and continues to serve in those capacities since the Merger.
 
27

 
(3)
Mr. Miller served as the President and Chief Executive Officer of URON Inc. from August 2006 until November 29, 2007.

(4)
Mr. Staehr became the Chief Financial Officer of URON Inc. effective November 29, 2007, and continues to serve in that capacity since the Merger.
 
(5)
Amounts listed reflect the dollar amounts related to option awards recognized for financial statement reporting purposes with respect to the fiscal years indicated, in accordance with FAS 123(R) (disregarding the estimate of forfeitures related to service-based vesting conditions). Assumptions used in the calculation of these amount are included in footnote 7 to the Company’s audited financial statements for the fiscal year ended December 31, 2007, which are set forth in ITEM 8 above.
 
URON Inc. Executive Compensation Prior to the Merger

Prior to the Merger, URON Inc. did not pay any cash or cash-equivalent remuneration to any executive officer or any director during its last most recently completed years ended December 31, 2006 and 2007. The Company issued no options, warrants, restricted stock, or stock-based compensation to any officer or director during the year ended December 31, 2006. In February 2007, the Company entered into an employment agreement with Donald Miller, thereby employing him as its Chief Executive Officer. Under that employment agreement, Mr. Miller’s sole compensation was the issuance of 50,000 shares of URON common stock (after giving effect to the December 27, 2007 reverse stock split) with restricted transferability. On November 29, 2007, in connection with the appointment of Mr. Christopher Larson as the Company’s President and Chief Executive Officer and the resignation of Mr. Miller from such position, the Company and Mr. Miller terminated the aforementioned employment agreement.

Also on November 29, 2007, in connection with their appointments as Chief Operating Officer and Chief Financial Officer of URON Inc., respectively, Messrs. Quandahl and Staehr received non-vested contingent options to purchase shares of Company common stock at the per-share price of $0.01. Under their respective option agreements, Mr. Staehr had the right to purchase up to 550,000 common shares and Mr. Quandahl had the right to purchase up to 400,000 common shares. By their terms, the options did not vest or become exercisable until the Company engaged in a change in control, as defined in the option agreements. The closing of the Merger constituted a change in control, as defined in such agreements. The option agreements provided that the shares purchasable thereunder were not to be affected by any stock combination (i.e., reverse stock split) effected in connection with the Merger. The value ascribed to the component of executive compensation represented by the stock options, in accordance with FAS 123(R), is set forth in the Summary Compensation Table (see above) in column captioned “Long-Term Compensation Awards - Securities Underlying Options.”

Wyoming Financial Lenders, Inc. Executive Compensation Prior to the Merger

Prior to the Merger, Wyoming Financial Lenders, Inc. paid cash compensation, but did not issue any options, warrants, restricted stock or other stock-based compensation, to John Quandahl, its principal executive officer, during the years ended December 31, 2006 and 2007. Wyoming Financial Lenders, Inc. did not have an employment agreement with Mr. Quandahl during that time. Nevertheless, Wyoming Financial Lenders, Inc. did have an arrangement with Mr. Quandahl at the time of the Merger to pay him an annual salary of $250,000.

Executive Compensation Arrangements of the Company After the Merger

Since the Merger, the Company (on a combined basis) has not entered into and does not have any employment agreements with any named executives or any other members of its executive management. The Company’s current arrangement with Mr. Larson, its President and Chief Executive Officer, is to pay him an annual salary of $144,000. The Company’s current arrangement with Mr. Quandahl, its Chief Operating Officer, is to pay him an annual salary of $250,000. The Company’s current arrangement with Mr. Staehr, its Chief Financial Officer, is to pay him an annual salary of $120,000.
 
28


Outstanding Equity Awards at Fiscal Year End
 
The table below sets forth certain information regarding unexercised options, as of December 31, 2007, for each of the named executives identified in the Summary Compensation Table (see above):

          
     
 
Option Awards
 
 
 
 
 
 
 
 
 
 
Name
 
 
 
 
 
Number of Securities Underlying Unexercised Options (#) Exercisable
 
 
 
 
 
Number of Securities Underlying Unexercised Options (#) Unexercisable
 
 
Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)
 
 
 
 
 
 
 
 
Option Exercise Price ($)
 
 
 
 
 
 
 
 
Option Expiration Date
 
John Quandahl
   
400,000
(1)
 
0
   
0
 
$
0.01
   
11/29/08
 
Christopher Larson
   
0
   
0
   
0
   
-
   
-
 
Donald Miller
   
0
   
0
   
0
   
-
   
-
 
Steven Staehr
   
550,000
(1)
 
0
   
0
 
$
0.01
   
11/29/08
 

 
(1)
Option was granted on November 29, 2007, subject to vesting upon a change in control of the Company. The Merger qualified as a change in control of the Company, as defined under the relevant option agreement.

Employment and Change-in-Control Agreements

The Company does not currently have any employment or change-in-control agreements with the named executives or any other current members of its executive management. Nevertheless, the Company may consider entering into employment agreements and change-in-control agreements with members of its senior management.

Compensation of Directors

Currently, our directors receive no compensation pursuant to any standard arrangement for their services as directors. Nevertheless, we may in the future determine to provide our directors with some form of compensation, either cash or options or contractually restricted securities. 

29

 

ITEM 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

As of the close of business on March 31, 2008, the Company had outstanding two classes of voting securities—common stock, of which there were 9,014,644 shares issued and outstanding; and Series A Convertible Preferred Stock, of which there were 10,000,000 shares issued and outstanding. Each share of capital stock is currently entitled to one vote on all matters put to a vote of our shareholders. The following table sets forth the number of common shares, and percentage of outstanding common shares, beneficially owned as of March 31, 2008, by:

·
each person known by the Company to be the beneficial owner of more than five percent of the Company’s outstanding common stock

·
each current director

·
each executive officer of the Company and other persons identified as a named executive officer in Item 11 above, and

·
all current executive officers and directors as a group.

Unless otherwise indicated, the address of each of the following persons is 2201 West Broadway, Suite 1, Council Bluffs, Iowa 51501, and each such person has sole voting and investment power with respect to the shares set forth opposite his, her or its name.

Name and Address
 
Common Shares Beneficially Owned (1)
 
Percentage of Common Shares (1)
 
Christopher Larson (2)
   
1,861,290
   
20.6
%
Steven Staehr (3)
   
966,667
   
10.7
%
John Quandahl (4)
   
400,000
   
4.4
%
John H. Klaasen IV (5)
   
0
   
*
 
James Mandel (6)
   
470
   
*
 
Mark Houlton (7)
   
416,667
   
4.6
%
Robert W. Moberly (8)
   
11,125,000
   
58.5
%
All current executive officers and directors as a group (9)
   
14,770,094
   
77.7
%
Donald Miller (10)
9449 Science Center Drive
New Hope, MN 55428
   
61,354
   
*
 
WERCS (11)
400 East First Street
PO Box 130
Casper, WY 82602
   
11,125,000
   
58.5
%
Lantern Advisors, LLC (12)
80 South Eighth Street, Suite 900
Minneapolis, MN 55402
   
713,310
   
7.6
%
Mill City Ventures, LP (13)
80 South Eighth Street, Suite 900
Minneapolis, MN 55402
   
800,000
   
8.9
%
Joseph A. Geraci, II (14)
80 South Eighth Street, Suite 900
Minneapolis, MN 55402
   
1,513,310
   
16.1
%

* less than 1%
 
30


(1)
Beneficial ownership is determined in accordance with the rules of the SEC, and includes general voting power and/or investment power with respect to securities. Shares of common stock issuable upon exercise of options or warrants that are currently exercisable or exercisable within 60 days of the record rate, and shares of common stock issuable upon conversion of other securities currently convertible or convertible within 60 days, are deemed outstanding for computing the beneficial ownership percentage of the person holding such securities but are not deemed outstanding for computing the beneficial ownership percentage of any other person.

(2)
Mr. Larson became the Company’s Chief Executive Officer on November 29, 2007. All shares reflected in the table are outstanding common shares.

(3)
Mr. Staehr became the Company’s Chief Financial Officer on November 29, 2007. All shares reflected in the table are outstanding common shares.

(4)
Mr. Quandahl became the Company’s Chief Operating Officer on November 29, 2007. All shares reflected in the table are outstanding common shares.

(5)
Mr. Klaasen became a director of the Company on December 31, 2007.

(6)
Mr. Mandel became a director of the Company on December 31, 2007.

(7)
Mr. Houlton became a director of the Company on December 31, 2007. All shares reflected in the table are outstanding common shares.

(8)
Mr. Moberly became a director of the Company on December 31, 2007. Mr. Moberly is the Chief Operating Officer of WERCS, a Wyoming corporation, which was the sole stockholder of Wyoming Financial Lenders, Inc. prior to its acquisition by URON effective December 31, 2007. All shares reflected in the table as beneficially owned by Mr. Moberly are issuable upon conversion of an equal number of shares of Series A Convertible Preferred Stock held of record by WERCS.

(9)
Includes Messrs. Larson, Staehr, Quandahl, Klaasen, Mandel, Houlton and Moberly.

(10)
Mr. Miller was the Company’s Chief Executive Officer during 2007 until November 29, 2007. Mr. Miller served as the Company’s sole director until December 31, 2007.

(11)
WERCS is a Wyoming corporation that was the sole stockholder of Wyoming Financial Lenders, Inc. prior to its acquisition by URON effective December 31, 2007. All shares beneficially owned by WERCS are common shares issuable upon conversion of Series A Convertible Preferred Stock. Investment and voting control over the shares beneficially owned by WERCS is exercised by Robert W. Moberly, the Chief Operating Officer of such entity.

(12)
Lantern Advisers, LLC is a Minnesota limited liability company beneficially owned by Mr. Joseph A. Geraci, II and Douglas Polinsky, each of whom share investment and voting control. 400,000 share reflected in the table are issuable upon exercise of a warrant.

(13)
Mill City Ventures, LP is a Minnesota limited partnership the securities of which are beneficially held by Mill City Advisors LLC, a Minnesota limited liability company that serves as the general partner to Mill City Ventures, LP. Investment and voting control over the shares beneficially owned by Mill City Advisors LLC is exercised by Joseph A. Geraci, II, the Chief Manager of such company.

(14)
Joseph A. Geraci, II possesses beneficial ownership of securities held by Lantern Advisers, LLC and Mill City Ventures, LP. See footnotes 12 and 13 above. Mr. Geraci disclaims beneficial ownership of such shares except to the extent of any pecuniary interest therein.
 
31

 
ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

Certain Relationships and Related Transactions

Management Agreement with Multiband Corporation. The Company is party to a management agreement with Multiband Corporation for personnel and office support (including operations and accounting). URON incurred service fees to Multiband Corporation in the amount of $56,570 for the year ended December 31, 2006. Don Miller, our sole director during this period, was also the Chairman of the Board of Directors of Multiband. During such time, Mr. Miller was also our Chief Executive Officer. The Board of Directors believes that the fees paid and payable to Multiband Corporation pursuant to the management agreement are at market rate.

Certain Equity and Equity-Linked Transactions. On November 29, 2007, the Company entered into three separate transactions. In one transaction, the Company issued a warrant to Lantern Advisers, LLC, a Minnesota limited liability company and then a holder of more than ten percent of the Company’s outstanding common stock. The warrant provides Lantern Advisers with the right, for a period of five years, to purchase up to 400,000 shares of our common stock at the per-share price of $0.01.

In another transaction on the same date, the Company entered into a Common Stock Purchase Agreement with Christopher Larson, who was appointed Chief Executive Officer of the Company on that date. Under the Common Stock Purchase Agreement, Mr. Larson had the right to purchase 1,071,875 shares of common stock for an aggregate purchase price of $500,000 by December 31, 2007. Among other terms and conditions, the agreement provided that the shares purchasable thereunder were not to be affected by any stock combination (i.e., reverse stock split) effected in connection with the Merger.

In the third transaction on the same date, the Company also issued options, pursuant to the terms and conditions set forth in option agreements, to various executive and non-executive management personnel. In total, the Company entered into option agreements with nine persons, obligating the Company to issue up to a maximum aggregate of 1,600,000 shares of common stock at the per-share price of $0.01. Among the optionees, the Company entered into option agreements with Messrs. Steven Staehr and John Quandahl, who were respectively appointed as Chief Financial Officer and Chief Operating Officer of the Company on that same date. Under their respective option agreements, Mr. Staehr had the right to purchase 550,000 shares and Mr. Quandahl had the right to purchase 400,000 shares. Upon issuance, the options were not vested or exercisable until the Company engaged in a change in control (as defined in such agreements). The closing of the Merger constituted a change in control, as defined in the option agreements. The option agreements provided that the shares purchasable thereunder were not to be affected by any stock combination (i.e., reverse stock split) effected in connection with the Merger.
 
Subscriptions for Shares of Common Stock. In addition to the purchase of shares of common stock by Mr. Larson in the equity financing undertaken in connection with the Merger, Steve Staehr (the Company’s Chief Financial Officer), Mark Houlton (a director-appointee under the terms of the Merger Agreement), and Mill City Ventures, LP (a Minnesota limited partnership beneficially owned by Mr. Joseph A. Geraci, II, a beneficial owner of more than ten percent of the common equity of the Company) also subscribed for shares of the Company’s common stock in such financing. Mr. Staehr purchased 416,667 shares for an aggregate of $500,000; Mr. Houlton purchased 416,667 shares for an aggregate of $500,000; and Mill City Ventures, LP purchased 800,000 shares for an aggregate of $960,000. The subscription agreements pursuant to which such persons and entities purchased shares in the financing involved the same terms and conditions as other purchasers in such financing (excepting Mr. Larson, whose Common Stock Purchase Agreement is discussed above).
 
Exchange Agreement with National Cash & Credit. On February 26, 2008, the Company entered into an Exchange Agreement with National Cash & Credit, LLC, a Minnesota limited liability company, and the members of National Cash & Credit. Under the Exchange Agreement, the members of National Cash & Credit assigned all of the outstanding membership interests in National Cash & Credit to the Company in exchange for the Company’s issuance to such members of an aggregate of 1,114,891 shares of common stock and a cash payment of $100,000. The closing of the transactions contemplated by the Exchange Agreement occurred effective as of February 26, 2008, simultaneously with the effectiveness of the agreement itself.

The Exchange Agreement contained customary representations, warranties and covenants of the parties and indemnification obligations relating thereto which survive until the Company’s annual report on Form 10-K, for the year ended December 31, 2008, has been filed with the SEC (with certain exceptions for claims that may be based fraud of willful misconduct).
 
32


Christopher Larson, the Company’s Chief Executive Officer and President, held a direct and indirect material financial interest in National Cash by virtue of membership interests held directly in his name and his ownership of interests in two separate limited liability companies that owned membership interests in National Cash. The ownership of Mr. Larson in National Cash and the material terms and conditions of the Exchange Agreement were disclosed to the Company’s Board of Directors, which approved the Exchange Agreement and the transactions contemplated thereby.

Director Independence and Related Matters

The Company currently has three directors, Messrs. James Mandel, Mark Houlton and John H. Klaasen IV, who are “independent” as that term is defined in Section 4200(a)(15) of National Association of Securities Dealers’ listing standards. The Company, however, is not subject to those listing standards because its common stock is not listed for trading on a Nasdaq market and trades only on the OTC Bulletin Board.

The Company’s Board of Directors has a standing audit committee and compensation committee, and each of the above-named independent directors are the only directors serving on such committees. For more information, please see the caption “Committees of the Board of Directors” under ITEM 10 above.

ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES.

General

The Board of Directors and management of the Company are committed to the quality, integrity and transparency of the Company’s financial reports. The Company’s independent accountants play an important role in the Company’s system of financial control. The Company’s Board of Directors has appointed Lurie Besikof Lapidus & Company, LLP (“Lurie Besikof”), as the Company’s independent registered public accounting firm. The appointment of Lurie Besikof was recently ratified by the shareholders of the Company at a special meeting held on March 17, 2008.

Fees Billed to Company by its Independent Registered Public Accounting Firm

The following table presents fees for professional audit services, tax services and other services rendered by the Company’s independent registered public accounting firms during or related to the fiscal years ended December 31, 2006 and 2007.

   
Fiscal Year Ended
December 31, 2006 (1)
 
Fiscal Year Ended
December 31, 2007
 
Audit Fees (1)
 
$
41,580
   
312,825
 
Tax Fees (2)
   
4,225
   
0
 
All Other Fees (3)
   
0
   
0
 
               
Total Fees
 
$
45,805
   
312,825
 
 

(1) All services rendered during or related to the fiscal year ended December 31, 2006 were rendered by Virchow Krause & Company, LLP. All services rendered during or related to the fiscal year ended December 31, 2007 were rendered by Lurie Besikof. Audit Fees consist of fees for professional services rendered for the audit of the consolidated financial statements of the Company and review of quarterly SEC filings.
   
(2)
Tax Fees consist of fees for tax compliance, tax advice and tax planning.

(3)
All Other Fees typically consist of fees for permitted non-audit products and services rendered.
 
33

 
Pre-approval Policy

The written charter of the audit committee provides that all non-audit accounting services that are permitted to be performed by the Company’s independent registered certified public accounting firm under applicable rules and regulations must be pre-approved by the audit committee or by designated members of the audit committee, other than with respect to de minimis exceptions permitted under the Sarbanes-Oxley Act of 2002. The audit committee was formed and its charter adopted on February 2, 2008.

Prior to or as soon as practicable following the beginning of each fiscal year, a description of the audit, audit-related, tax, and other services expected to be performed by the independent registered certified public accounting firm in the following fiscal year will be presented to the audit committee for approval. Following such approval, any requests for audit-related, tax, and other non-audit services not presented and pre-approved must be submitted to the audit committee for specific pre-approval and cannot commence until such approval has been granted.

Normally, pre-approval is provided at regularly scheduled meetings. Nevertheless, the authority to grant specific pre-approval between meetings, as necessary, may be delegated to the Chair of the audit committee. The Chair must update the audit committee at the next regularly scheduled meeting of any services that were granted specific pre-approval.

PART IV

ITEM 15.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

The following documents are filed as part of this annual report:

(1) Financial Statements (see Item 8 — Index to Consolidated Financial Statements).
(2) Financial Statement Schedules — not applicable.
(3) Exhibits (see Exhibit Index).

34

 

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
     
 
URON INC.
 
 
 
 
 
 
  /s/ Christopher Larson
 
Christopher Larson
President and Chief Executive Officer
  Date: April 7, 2008

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
 
Name
 
Title(s)
 
Date
/s/ Christopher Larson        

Christopher Larson
 
President, Chief Executive Officer and Director
(Principal Executive Officer)
 
April 7, 2008
         
 /s/ Steven Staehr        

Steven Staehr
 
Chief Financial Officer
(Principal Financial Officer)
 
April 7, 2008
         
         

Robert W. Moberly
 
Director
 
 
         
/s/ Jim Mandel        

James L. Mandel
 
Director
 
April 7, 2008
         
/s/ Mark Houlton        

Mark Houlton
 
Director
 
April 7, 2008
         
/s/ John H. Klaasen IV        

John H. Klaasen IV
 
Director
 
April 7, 2008
 
35

 
Exhibit Index

The following exhibits are filed as a part of this Annual Report on Form 10-K:

Exhibit No.
 
Description
2.1
 
Agreement and Plan of Merger and Reorganization dated December 13, 2007, by and among URON Inc. (the registrant), WFL Acquisition Corp., a Wyoming corporation and wholly owned subsidiary of the registrant, and Wyoming Financial Lenders, Inc., a Wyoming corporation (incorporated by reference to Exhibit 2.1 to the registrant’s current report on Form 8-K filed on December 14, 2007).
     
2.2
 
Exchange Agreement with National Cash & Credit, LLC and certain members of National Cash & Credit, LLC, dated February 26, 2008 (filed herewith).
     
3.1
 
Amended and Restated Articles of Incorporation, filed with the Minnesota Secretary of State on May 25, 2007 (filed herewith) (see also Exhibits 3.2 and 3.4 below).
     
3.2
 
Amendment to Amended and Restated Articles of Incorporation, filed with the Minnesota Secretary of State on December 27, 2007 (filed herewith).
     
3.3
 
Articles of Merger relating to the merger of WFL Acquisition Corp. with and into Wyoming Financial Lenders, Inc. (incorporated by reference to Exhibit 3.1 to the registrant’s current report on Form 8-K filed on January 7, 2008) (see also Exhibit 2.1 above).
     
3.4
 
Certificate of Designation for Series A Convertible Preferred Stock (incorporated by reference to Exhibit 3.2 to the registrant’s current report on Form 8-K filed on January 7, 2008).
     
3.5
 
Amendment to Articles of Incorporation, filed with the Minnesota Secretary of State on March 18, 2008 (filed herewith).
     
3.6
 
Corporate bylaws, as amended (filed herewith).
     
10.1
 
Common Stock Purchase Warrant issued to Lantern Advisers, LLC, on November 29, 2007 (filed herewith).
     
10.2
 
Common Stock Purchase Warrant issued to Donald Miller on July 5, 2007 (filed herewith).
     
10.3
 
2008 Stock Incentive Plan (filed herewith).
     
10.4
 
Form of Subscription Agreement entered into with purchasers of common stock on or about December 31, 2007 (filed herewith).
     
10.5
 
URON Management Agreement, dated August 1, 2006 (incorporated by reference to Exhibit 10.1 to the registrant’s Form 10-QSB for the quarter ended June 30, 2006).
 
36

 
14
 
Code of Ethics (incorporated by reference to Exhibit 14 to the registrant’s annual report on Form 10-KSB for the year ended December 31, 2006).
     
16
 
Letter from Virchow Krause & Company, LLP (incorporated by reference to Exhibit 16.1 to the registrant’s current report on Form 8-K filed on February 19, 2008).
     
21
 
List of Subsidiaries (filed herewith).
     
31.1
 
Certification pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (filed herewith).
     
31.2    Certification pursuant to Section 302 of the Sarbanes Oxley Act of 2002 (filed herewith).
     
32.1
 
Certification pursuant to Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (filed herewith).
     
32.2  
Certification pursuant to Section 1350, as adopted pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (filed herewith).
 
37

EX-2.2 2 v108896_ex2-2.htm
EXCHANGE AGREEMENT
 
This Exchange Agreement (hereinafter the “Agreement”) is entered into on the date set forth on the signature page hereto, but effective as of February 26, 2008, by and among URON Inc., a Minnesota corporation (hereinafter “URON”); National Cash & Credit, LLC, a Minnesota limited liability company (“National Cash”); and the members of National Cash listed on Schedule I attached hereto (each a “National Cash Member,” and collectively the “National Cash Members”).

RECITALS

A. The board of directors of URON and the board of governors of National Cash have adopted resolutions approving and adopting the proposed exchange transaction (the “Exchange”) whereby URON will acquire from the National Cash Members all of the issued and outstanding Class A Membership Interests and Class B Membership Interests of National Cash in exchange for shares of Common Stock of URON (“URON Common Stock”), upon the terms and conditions set forth in this Agreement.

B. Pursuant to the Exchange, all Class A and Class B Membership Interests of National Cash shall be exchanged for an aggregate of 1,114,891 shares of URON Common Stock.

C. Each National Cash Member owns the number of Class A or Class B Membership Interests of National Cash set forth opposite such National Cash Member’s name on Schedule I attached hereto (collectively, the “National Cash Membership Interests”).

D. The National Cash Members collectively own all of the issued and outstanding National Cash Membership Interests and the National Cash Members desire to sell and transfer to URON their respective National Cash Membership Interests pursuant to the terms and conditions of this Agreement.

E. National Cash will enter into this Agreement for the purpose of evidencing its consent to the consummation of the Exchange and for the purpose of making certain representations, warranties, covenants and agreements.

NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

1.1 The Exchange.

(a) Upon the terms and subject to the conditions hereof, at the Closing (as hereinafter defined), the National Cash Members will sell, convey, assign, transfer and deliver to URON certificates representing the National Cash Membership Interests, and URON will issue to each National Cash Member, in exchange for such National Cash Member’s National Cash Membership Interests, (i) that number of shares of URON Common Stock set forth opposite such National Cash Member’s name on Schedule I attached hereto, and (ii) a cash payment of $100,000 (to be apportioned among the National Cash Members as they shall determine and designate). The total number of shares of URON Common Stock to be issued to the National Cash Members at the Closing will be 1,114,891.

(b) The closing of the Exchange (the “Closing”) shall take place effective as of the date first set forth above (sometimes referred to hereinafter as the “Closing Date”).

(c) The shares of URON Common Stock to be issued to the National Cash Members hereunder shall be “restricted securities” as that term is defined in Rule 144 promulgated under the Securities Act of 1933 (the “Securities Act”) and the certificates evidencing such shares shall bear standard restrictive legends.
 
 
 

 
 
(d)  For purposes of this Agreement and the exhibits and schedules attached hereto, the following terms shall have the meanings specified or referred to below, unless the context otherwise requires:

Affiliate” means with respect to a specified Person (as defined in Section 2(k) below), any other Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the specified Person; it being understood and agreed that, for purposes of this definition, the term “control” means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or other ownership interest, by contract or otherwise.

Code” means the Internal Revenue Code of 1986, as amended.

Liability” means any liability or obligation (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, whether incurred or consequential and whether due or to become due), including any liability for taxes.

Material Adverse Effect” means with respect to any Person, any event or events or any change in or effect on such Person’s financial condition, business, prospects, operations, customers, suppliers, employee relationships, assets, properties, or results of operations that, when taken as a whole, (i) is greater than $50,000, (ii) has materially interfered or is reasonably likely to materially interfere with the ongoing operations of such Person’s business or (iii) singly or in the aggregate has resulted in, or is reasonably likely to have, a material adverse effect on the ongoing conduct of the business of such Person; provided, however, that any adverse effect arising out of or resulting from (x) an event or series of events or circumstances affecting the United States economy generally or the economy generally of any other country in which the Person operate, or (y) the entering into of this Agreement and the consummation of the transactions contemplated thereby, shall be excluded in determining whether a Material Adverse Effect has occurred.

2. Representations Relating to National Cash. Each of the National Cash Members and National Cash represents and warrants as follows, which warranties and representations shall also be true as of the Closing except as set forth in the disclosure schedules attached to this Agreement:
 
(a) National Cash has the power to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by the board of governors of National Cash. This Agreement has been duly executed and delivered by National Cash and constitutes a legal, valid and binding obligation of National Cash, enforceable against National Cash in accordance with its terms, except as enforcement may be limited by applicable bankruptcy, insolvency or other laws affecting creditor’s rights generally or by legal principles of general applicability governing the availability of equitable remedies.
 
(b) Attached hereto as Schedule 2(b) are the unaudited consolidated balance sheets and statements of income, changes in members’ equity, and cash flow as of and for the fiscal year ended December 31, 2007 (collectively the “National Cash Financial Statements”). The National Cash Financial Statements (including the notes thereto) have been prepared in accordance with GAAP throughout the periods covered thereby and present fairly the financial condition of National Cash as of such dates and the results of operations of National Cash for such periods.
 
 
2

 
 
(c) Since December 31, 2007, there has not been any material adverse change in the condition of National Cash (financial or otherwise).
 
(d) National Cash is not a party to, or the subject of, any pending litigation, claims, or governmental investigation or proceeding not reflected in National Cash Financial Statements, and to the actual knowledge of its executive officers and directors (herein “Knowledge”), there are no lawsuits, claims, assessments, investigations, or similar matters, threatened or contemplated against or affecting National Cash or the management or properties of National Cash. Neither National Cash nor any of its assets or properties are subject to any outstanding court order or consent decree.
 
(e) National Cash has been duly organized and is validly existing and in good standing under the laws of the State of Minnesota, and has the power to own, lease and operate its property and to carry on its business as now being conducted and is duly qualified to do business and in good standing to do business in any jurisdiction where so required except where the failure to so qualify would have no Material Adverse Effect on National Cash.
 
(f) National Cash has filed all material federal, state, county and local income, excise, property and other tax, governmental and/or other returns, forms, filings, or reports, which are due or required to be filed by it prior to the date hereof and have paid or made adequate provision in National Cash Financial Statements for the payment of all taxes, fees, or assessments which have or may become due pursuant to such returns, filings or reports or pursuant to any assessments received. National Cash is not delinquent or obligated for any tax, penalty, interest, delinquency or charge and there are no tax liens or encumbrances applicable to it.
 
(g) All outstanding National Cash Membership Interests are, and shall be at Closing, validly issued, fully paid and nonassessable. There are no existing options, convertible or exchangeable securities, calls, claims, warrants, preemptive rights, registration rights or commitments of any character relating to the issued or unissued securities of National Cash. There are no voting trusts, proxies or other agreements, commitments or understandings of any character to which National Cash is a party or by which National Cash is bound with respect to the voting of any National Cash Membership Interest. There are no outstanding obligations to repurchase, redeem or otherwise acquire any National Cash Membership Interest.
 
(h) National Cash is the owner of, or has a valid leasehold interest in, the properties and assets used by it located on its premises, or shown on the most recent balance sheet comprising a part of the National Cash Financial Statements (the “Most Recent Balance Sheet”) or acquired after the date thereof, free and clear of all liens and encumbrances, except for properties and assets disposed of in the Ordinary Course of Business since the date of the Most Recent Balance Sheet. For purposes of this Agreement, the term “Ordinary Course of Business” means the ordinary course of business consistent with past custom and practice (including with respect to quantity and frequency).
 
(i) National Cash has no material liability (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due, including any liability for taxes), except for (i) liabilities set forth in the National Cash Financial Statements, (ii) liabilities set forth in Schedule 2(i), and (iii) of liabilities that have arisen after the date of the Most Recent Balance Sheet in the Ordinary Course of Business and Liabilities incurred in connection with the transactions contemplated by this Agreement.
 
(j) National Cash owns no real property. National Cash has delivered to URON a true and complete copy of each lease agreement relating to real property under which National Cash is the lessee (the “Leases”). There are no oral lease agreements for real property under which National Cash is the lessee. With respect to each of the Leases: (i) such Lease is legal, valid, binding, enforceable and in full force and effect; (ii) the transactions contemplated by this Agreement do not require the consent of any other party to such Lease, will not result in a breach of or default under such Lease, and will not otherwise cause such Lease to cease to be legal, valid, binding, enforceable and in full force and effect on substantially the same terms following the Closing; (iii) National Cash’s possession and quiet enjoyment of the Leased Real Property under such Lease has not been disturbed and, to the Knowledge of National Cash, there are no disputes with respect to such Lease; (iv) neither National Cash nor, to the Knowledge of National Cash, any other party to the Lease is in breach of or default under such Lease; (v) no security deposit or portion thereof deposited with respect to such Lease has been applied in respect of a breach of or default under such Lease that has not been redeposited in full; (vi) the other party to such Lease is not an affiliate of, and otherwise does not have any economic interest in, National Cash; and (vii) National Cash has not subleased, licensed or otherwise granted any person the right to use or occupy any leased real property or any portion thereof.
 
 
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(k) Schedule 2(k) lists the following contracts and other agreements presently in effect to which National Cash is a party: (i) any agreement (or group of related agreements) for the lease of personal property to or from any person or entity (“Person”) providing for lease payments in excess of $50,000 per annum: (ii) any agreement (or group of related agreements) for the purchase or sale of raw materials, commodities, supplies, products, or other personal property, or for the furnishing or receipt of services, the performance of which will extend over a period of more than one year or involve consideration in excess of $50,000; (iii) any agreement concerning a partnership or joint venture; (iv) any agreement (or group of related agreements) under which it has created, incurred, assumed, or guarantied any indebtedness for borrowed money, or any capitalized lease obligation, in excess of $50,000 or under which it has imposed an encumbrance on any of its assets, tangible or intangible; (v) any material agreement concerning confidentiality or non-competition; (vi) any profit sharing, stock option, stock purchase, stock appreciation, deferred compensation, severance, or other material plan or arrangement for the benefit of its current or former directors, officers, and employees; (vii) any collective bargaining agreement; (viii) any agreement for the employment of any individual on a full-time, part-time, consulting, or other basis providing annual compensation or severance benefits in excess of $50,000; (ix) any agreement under which it has advanced or loaned any amount to any of its directors, officers, and employees outside the Ordinary Course of Business; (x) any agreement under which National Cash has advanced or loaned any other Person amounts in the aggregate exceeding $50,000; or (xi) any other agreement (or group of related agreements) the performance of which involves consideration in excess of $50,000.
 
National Cash has delivered to URON a correct and complete copy of each written agreement (as amended to date) listed in Schedule 2(k) and a written summary setting forth the material terms and conditions of each oral agreement referred to in such Schedule. With respect to each such agreement: (A) the agreement is legal, valid, binding, enforceable, and in full force and effect in all material respects; (B) to the Knowledge of National Cash, no party is in material breach or default, and no event has occurred that with notice or lapse of time would constitute a material breach or default, or permit termination, modification, or acceleration, under the agreement; and (C) to the Knowledge of National Cash, no party has repudiated any material provision of the agreement.
 
(l) All notes and accounts receivable were generated by National Cash in the Ordinary Course of Business and are valid receivables subject to no setoffs or counterclaims, are current and collectible. National Cash has no Knowledge of any fact or circumstance that would cause it to believe that the collection percentage with respect to the notes and receivables will substantially vary from the average collection experience of National Cash over the prior three years.
 
 
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(m) With respect to each material insurance policy of National Cash: (A) the policy is legal, valid, binding, enforceable, and in full force and effect in all material respects; (B) to the Knowledge of National Cash, none of National Cash or any other party to the policy is in material breach or default (including with respect to the payment of premiums or the giving of notices), and no event has occurred that, with notice or the lapse of time, would constitute such a material breach or default, or permit termination, modification, or acceleration, under the policy; and (C) no party to the policy has repudiated any material provision thereof. National Cash has no material self-insurance arrangements.
 
(n) National Cash has no employee benefit plans.
 
(o) No Affiliate of National Cash, nor any member of the family of an Affiliate of National Cash, has been involved in any material business arrangement or relationship with National Cash within the past 12 months, and neither such Affiliate nor any member of such Affiliate’s family owns any material asset, tangible or intangible, that is used in the business of National Cash.
 
(p) The minute books, and other documents and records of National Cash have been or will be made available to URON prior to the Closing.
 
(q) The execution of this Agreement does not violate or breach any material agreement or contract to which National Cash is a party, and National Cash, to the extent required, has (or will have by Closing) obtained all necessary approvals or consents required by any agreement to which National Cash is a party. The execution and performance of this Agreement will not violate or conflict with any provision of the articles of organization or bylaws or member control agreement of National Cash.
 
(r) National Cash has complied with all of the provisions relating to the issuance of securities, and for the registration thereof, under the Securities Act, other applicable securities laws, and all applicable blue sky laws in connection with any and all of its stock issuances. There are no outstanding, pending or threatened stop orders or other actions or investigations relating thereto involving federal and state securities laws. All issued and outstanding shares of National Cash’s capital stock were offered and sold in compliance with federal and state securities laws and were not offered, sold or issued in violation of any preemptive right, right of first refusal or right of first offer and are not subject to any right of recission.
 
(s) National Cash is and has been in compliance with, and National Cash has conducted any business previously owned or operated by it in compliance with, all applicable laws, orders, rules and regulations of all governmental bodies and agencies, including applicable securities laws and regulations and environmental laws and regulations, except where such noncompliance has and will have, in the aggregate, no Material Adverse Effect.
 
(t) The closing documents and the consummation by National Cash of the transactions contemplated hereby do not and will not (i) require the consent, approval or action of, or any filing or notice to, any corporation, firm, person or other entity or any public, governmental or judicial authority (except for such consents, approvals, actions, filing or notices the failure of which to make or obtain will not in the aggregate have a Material Adverse Effect), other than the consent of the members of National Cash; (ii) violate any order, writ, injunction, decree, judgment, ruling, law, rule or regulation of any federal, state or foreign court, administrative agency or commission or other governmental authority or instrumentality (a “Governmental Authority”) applicable to National Cash, or its business or assets; or (iii) constitute a material breach of any agreement, indenture, mortgage, license or other instrument or document to which National Cash is a party or to which it is otherwise subject.
 
 
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(u) There are no disagreements of any kind presently existing, or reasonably anticipated by National Cash to arise, between the accountants and lawyers formerly or presently employed by National Cash.
 
(v) Neither National Cash nor any of its past or present officers or directors is, or ever has been, the subject of any formal or informal inquiry or investigation by the Securities and Exchange Commission (“SEC”) or The National Association of Securities Dealers, Inc. (“NASD”).
 
(w) No representation or warranty by National Cash contained in this Agreement and no statement contained in any certificate, schedule or other communication furnished pursuant to or in connection with the provisions hereof contains or shall contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. There is no current or prior event or condition of any kind or character pertaining to National Cash that may reasonably be expected to have a Material Adverse Effect on National Cash. Except as specifically indicated elsewhere in this Agreement, all documents delivered by National Cash in connection herewith have been and will be complete originals, or exact copies thereof.
 
3. Representations of Nation Cash Members. The National Cash Members hereby represent and warrant to URON as follows:

(a) Each National Cash Member owns, beneficially and of record, good and marketable title to the National Cash Membership Interests set forth opposite such National Cash Member’s name on Schedule I attached hereto, free and clear of all security interests, liens, adverse claims, encumbrances, equities, proxies, options or member or member control agreements. Each National Cash Member represents that such person has no right or claims whatsoever to any National Cash Membership Interests, other than shares listed across such National Cash Member’s name on Schedule I and does not have any options, warrants or any other instruments entitling such National Cash Member to exercise to purchase or convert into National Cash Membership Interests, except as set forth in Schedule I. At the Closing, the National Cash Members will convey to URON good and marketable title to National Cash Membership Interests, free and clear of any security interests, liens, adverse claims, encumbrances, equities, proxies, options, member control agreements or restrictions.

(b)  This Agreement has been duly and validly executed and delivered by each National Cash Member and constitutes a valid and binding agreement of each National Cash Member, enforceable against each National Cash Member in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally or by general principles of equity.

(c) Each National Cash Member acknowledges that none of the shares of URON Common Stock will be registered pursuant to the Securities Act or any applicable state securities laws, that the URON Common Stock will be characterized as “restricted securities” under federal securities laws, and that under such laws and applicable regulations the URON Common Stock cannot be sold or otherwise disposed of without registration under the Securities Act or an exemption therefrom. In this regard, each National Cash Member is familiar with Rule 144 promulgated under the Securities Act, as currently in effect, and understands the resale limitations imposed thereby and by the Securities Act.

(d) Each National Cash Member (i) is acquiring the URON Common Stock solely for his own account for investment purposes, and not with a view to the distribution thereof, (ii) is a sophisticated investor with knowledge and experience in business and financial matters, (iii) has received certain information concerning URON and has had the opportunity to obtain additional information as desired in order to evaluate the merits and the risks inherent in holding the URON Common Stock, (iv) is able to bear the economic risk of acquiring the URON Common Stock pursuant to the terms of this Agreement, including a complete loss of his investment in the URON Common Stock, and (v) is an “Accredited Investor” as that term is defined in Rule 501 of Regulation D promulgated under the Securities Act.
 
 
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(e) Each National Cash Member acknowledges that the certificate(s) representing such National Cash Member’s URON Common Stock shall each conspicuously set forth on the face or back thereof a legend in substantially the following form:

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
 
4. Representations of URON. URON hereby represent and warrant as follows, each of which representations and warranties shall also be true as of the Closing except as set forth in the disclosure schedules attached to this Agreement:

(a) As of the Closing, the shares of URON Common Stock to be issued and delivered to the National Cash Members hereunder and in connection herewith will, when so issued and delivered, constitute duly authorized, validly and legally issued, fully-paid, nonassessable shares of URON capital stock, will not be issued in violation of any preemptive or similar rights and will be issued free and clear of all liens and encumbrances.

(b) URON has the corporate power to enter into this Agreement and to perform its obligations hereunder. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by the board of directors of URON. This Agreement has been duly executed and delivered by each of URON and constitutes a legal, valid and binding obligation of URON, enforceable against URON in accordance with its terms except as enforcement may be limited by applicable bankruptcy, insolvency or other laws affecting creditor’s rights generally or by legal principles of general applicability governing the availability of equitable remedies.

(c) URON has made available to National Cash a true and complete copy of the audited financial statements of Wyoming Financial Lenders, Inc. for the fiscal years ended September 30, 2006 and September 30, 2007 (the “URON Financial Statements”). The URON Financial Statements fairly present, in all material respects, the financial condition of URON as of the date thereof and the results of its operations for the periods then ended. The URON Financial Statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis.

(d) Since December 31, 2007, there has not been any material adverse change in the condition of the URON (financial or otherwise).

(e) URON is not a party to, or the subject of, any pending litigation, claims, or governmental investigation or proceeding not reflected in the URON Financial Statements, and to the Knowledge of URON, there are no lawsuits, claims, assessments, investigations, or similar matters, threatened or contemplated against or affecting URON, or the management or properties of URON. URON is not subject to any order, judgment, injunction or decree of any Governmental Authority or arbitrator.
 
 
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(f) URON is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation; has the corporate power to own, lease and operate its property and to carry on its business as now being conducted and is duly qualified to do business and in good standing to do business in any jurisdiction where so required except where the failure to so qualify would have no Material Adverse Effect on URON. URON is not required to be qualified to do business in any state other than in their respective states of incorporation.

(g) URON has filed all federal, state, county and local income, excise, property and other tax, governmental and/or other returns, forms, filings, or reports, which are due or required to be filed by it prior to the date hereof and have paid or made adequate provision in the URON Financial Statements for the payment of all taxes, fees, or assessments which have or may become due pursuant to such returns, filings or reports or pursuant to any assessments received. URON is not delinquent or obligated for any tax, penalty, interest, delinquency or charge and there are no tax liens or encumbrances applicable to either corporation.

(h) As of the date of this Agreement, URON’s authorized capital stock consists of 10,000,000 shares of URON Common Stock, no par value per share, of which 7,749,753 shares are issued and outstanding, and 10,000,000 shares of preferred stock, no par value per share, of which 10,000,000 have been designated Series A Preferred Stock and 10,000,000 shares are issued and outstanding. All outstanding shares of capital stock of URON are, and shall be at Closing, validly issued, fully paid and nonassessable.

(i) URON has not breached, nor is there any pending, or to the Knowledge of URON, any existing or threatened claim that URON has breached, any of the terms or conditions of any material agreements, contracts, commitments or other documents to which it is a party or by which it is, or its properties are bound. The execution and performance of this Agreement will not violate any provisions of applicable law or any agreement to which URON is subject.

(j) URON has complied with all of the provisions relating to the issuance of securities, and for the registration thereof, under the Securities Act, other applicable securities laws, and all applicable blue sky laws in connection with any and all of its stock issuances. There are no outstanding, pending or threatened stop orders or other actions or investigations relating thereto involving federal and state securities laws. All issued and outstanding shares of URON’s capital stock were offered and sold in compliance with federal and state securities laws and were not offered, sold or issued in violation of any preemptive right, right of first refusal or right of first offer and are not subject to any right of recission.

(k) All information regarding URON which has been provided to National Cash by URON or set forth in any document or other communication, disseminated to any former, existing or potential shareholders of URON or to the public or filed with the NASD, the SEC or any state securities regulators or authorities is true, complete, accurate in all material respects, not misleading, and was and is in full compliance with all securities laws and regulations.

(l) URON is and has been in compliance with, and URON has conducted any business previously owned or operated by it in compliance with, all applicable laws, orders, rules and regulations of all governmental bodies and agencies, including applicable securities laws and regulations (including, without limitation, the Sarbanes Oxley Act of 2002) and environmental laws and regulations, except where such noncompliance has and will have, in the aggregate, no Material Adverse Effect. URON has not received notice of any noncompliance with the foregoing, nor does it have Knowledge of any claims or threatened claims in connection therewith. URON has never conducted any operations or engaged in any business transactions whatsoever other than as set forth in the reports URON has previously filed with the SEC.
 
 
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(m) Without limiting the foregoing, (i) URON and any other person or entity for whose conduct URON is legally held responsible are and have been in compliance with all applicable federal, state, regional, and local laws, statutes, ordinances, judgments, rulings and regulations relating to any matters of pollution, protection of the environment, health or safety, or environmental regulation or control, and (ii) neither URON nor any other person for whose conduct URON is legally held responsible has manufactured, generated, treated, stored, handled, processed, released, transported or disposed of any hazardous substance on, under, from or at any of URON’s properties or in connection with URON’s operations. There is no pending or, to URON’s Knowledge, threatened civil or criminal litigation, written notice of violation, formal administrative proceeding or investigation, inquiry or information request by any Governmental Authority or other entity relating to any environmental law involving URON.

(n) URON has filed all required documents, reports and schedules with the SEC, the NASD and any applicable state or regional securities regulators or authorities (collectively, the “URON SEC Documents”). As of their respective dates, the URON SEC Documents complied in all material respects with the requirements of the Securities Act, the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the NASD rules and regulations and state and regional securities laws and regulations, as the case may be, and, at the respective times they were filed, none of the URON SEC Documents contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements (including, in each case, any notes thereto) of URON included in the URON SEC Documents complied as to form and substance in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto, were prepared in accordance with generally accepted accounting principles (except as may be indicated therein or in the notes thereto) applied on a consistent basis during the periods involved (except as may be indicated therein or in the notes thereto) and fairly presented in all material respects the financial position of URON as of the respective dates thereof and the results of its operations and its cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments and to any other adjustments described therein).

(o) Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will (a) result in any payment (whether severance pay, unemployment compensation or otherwise) becoming due from URON to any person or entity, including without limitation any employee, director, officer or affiliate or former employee, director, officer or affiliate of URON, (b) increase any benefits otherwise payable to any person or entity, including without limitation any employee, director, officer or affiliate or former employee, director, officer or affiliate of URON, or (c) result in the acceleration of the time of payment or vesting of any such benefits.

(p) Assuming appropriate filings and mailings are made by URON under the Securities Act, the Exchange Act, with the NASD, the execution and delivery by URON of this Agreement and the closing documents and the consummation by URON of the transactions contemplated hereby do not and will not (i) require the consent, approval or action of, or any filing or notice to, any corporation, firm, person or other entity or any public, governmental or judicial authority (except for such consents, approvals, actions, filing or notices the failure of which to make or obtain will not in the aggregate have a Material Adverse Effect); (ii) violate any order, writ, injunction, decree, judgment, ruling, law, rule or regulation of any Governmental Authority applicable to URON, or its business or assets; (iii) constitute a material breach of any agreement, indenture, mortgage, license or other instrument or document to which URON is a party or to which any of them is otherwise subject; and (iv) violate or conflict with any provision of the respective Articles of Incorporation or Articles of Incorporation or Bylaws of either URON. To the Knowledge of officers of URON, URON is not subject to, or a party to, any mortgage, lien, lease, agreement, contract, instrument, order, judgment or decree or any other material restriction of any kind or character which would prevent, hinder, restrict or impair the continued operation of the business of National Cash after the Closing.
 
 
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(q) There are no legal, administrative, arbitral or other proceedings, claims, suits, actions or governmental investigations of any nature pending, or to URON’s Knowledge threatened, directly or indirectly involving URON’s and/or officers, directors or affiliates, including, but not limited to any stockholder claims or derivative actions, or challenging the validity or propriety of the transactions contemplated by this Agreement.

(r) URON: (i) is not in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by URON under), nor has URON received notice of a claim that it is in default under or that it is in violation of, any indenture, mortgage, deed of trust or other agreement, instrument or contract to which URON is a party or by which it or any of its assets or properties are bound (whether or not such default or violation has been waived), (ii) is not in violation of any order of any court, arbitrator or governmental body, (iii) is not and has not been in violation of any law, order, rule, regulation, writ, injunction, judgment or decree of any Governmental Authority having jurisdiction over URON or any of its business or properties, including federal and state securities laws and regulations and (iv) is not in violation of any governmental authorization.

(s) There are no disagreements of any kind presently existing, or reasonably anticipated by URON to arise, between the accountants and lawyers formerly or presently employed by URON and URON.

(t) Neither URON nor any of its past or present officers or directors is, or ever has been, the subject of any formal or, to URON’s Knowledge, informal inquiry or investigation by the SEC or the NASD.

(u) No representation or warranty by URON contained in this Agreement and no statement contained in any certificate, schedule or other communication furnished pursuant to or in connection with the provisions hereof contains or shall contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. There is no current or prior event or condition of any kind or character pertaining to URON that may reasonably be expected to have a Material Adverse Effect on URON or its subsidiaries. Except as specifically indicated elsewhere in this Agreement, all documents delivered by URON in connection herewith have been and will be complete originals, or exact copies thereof.

5. Actions Prior to Closing.

(a) Prior to the Closing, National Cash on the one hand, and URON and on the other hand, shall be entitled to make such investigations of the assets, properties, business and operations of the other party, and to examine the books, records, tax returns, financial statements and other materials of the other party as such investigating party deems necessary in connection with this Agreement and the transactions contemplated hereby. Any such investigation and examination shall be conducted at reasonable times and under reasonable circumstances, and the parties hereto shall cooperate fully therein. Until the Closing, and if the Closing shall not occur, thereafter, each party shall keep confidential and shall not use in any manner inconsistent with the transactions contemplated by this Agreement, and shall not disclose, nor use for their own benefit, any information or documents obtained from the other party concerning the assets, properties, business and operations of such party, unless such information (i) is readily ascertainable from public or published information, (ii) is received from a third party not under any obligation to keep such information confidential, or (iii) is required to be disclosed by any law or order (in which case the disclosing party shall promptly provide notice thereof to the other party in order to enable the other party to seek a protective order or to otherwise prevent such disclosure). If this transaction is not consummated for any reason, each party shall return to the other all such confidential information, including notes and compilations thereof, promptly after the date of such termination. The representations and warranties contained in this Agreement shall not be affected or deemed waived by reason of the fact that either party hereto discovered or should have discovered any representation or warranty is or might be inaccurate in any respect.
 
 
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(b) Prior to the Closing, National Cash, URON agree not to issue any statement or communications to the public or the press regarding the transactions contemplated by this Agreement without the prior written consent of the other parties. In the event that URON is required under federal securities law to either (i) file any document with the SEC that discloses this Agreement or the transactions contemplated hereby, or (ii) to make a public announcement regarding this Agreement or the transactions contemplated hereby, URON shall provide National Cash with a copy of the proposed disclosure no less than 48 hours before such disclosure is made and shall incorporate into such disclosure any reasonable comments or changes that National Cash may request.

(c) Prior to the Closing, except as contemplated by this Agreement, there shall be no stock dividend, stock split, recapitalization, or exchange of shares with respect to or rights, options or warrants issued in respect of URON Common Stock after the date hereof and there shall be no dividends or other distributions paid on URON Common Stock after the date hereof, in each case through and including the Closing. URON shall conduct no business, prior to the Closing, other than in the ordinary course of business or as may be necessary in order to consummate the transactions contemplated hereby.

(d) Prior to the Closing, URON will timely file all required URON SEC Documents and comply in all material respects with the requirements of the Securities Act, the Exchange Act, the NASD rules and regulations and state and regional securities laws and regulations. 

6. Conditions Precedent to the Obligations of National Cash. All obligations of National Cash under this Agreement are subject to the fulfillment, prior to or as of the Closing, of each of the following conditions: (a) the representations and warranties by or on behalf of URON contained in this Agreement or in any certificate or document delivered pursuant to the provisions hereof or in connection herewith shall be true and correct in all respects at and as of the Closing as though such representations and warranties were made at and as of such time; (b) URON shall have materially performed and complied with all covenants, agreements, and conditions set forth or otherwise contemplated in, and shall have executed and delivered all documents required by, this Agreement to be performed or complied with or executed and delivered by them prior to or at the Closing; (c) a majority of the disinterested directors of URON shall have approved in accordance with applicable state corporation law the execution and delivery of this Agreement and the consummation of the transactions contemplated herein; (d) on or before the Closing Date, URON shall have delivered to National Cash certified copies of resolutions of the board of directors of URON approving and authorizing the execution, delivery and performance of this Agreement and authorizing all of the necessary and proper action to enable URON to comply with the terms of this Agreement; (e) no temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Exchange shall be in effect; (f) at the Closing, all instruments and documents delivered by URON pursuant to the provisions hereof shall be reasonably satisfactory to legal counsel for National Cash; and (g) National Cash shall have received all necessary and required approvals and consents from required parties.
 
 
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7. Conditions Precedent to the Obligations of URON. All obligations of URON under this Agreement are subject to the fulfillment, prior to or at the Closing, of each of the following conditions: (a) the representations and warranties by National Cash contained in this Agreement or in any certificate or document delivered pursuant to the provisions hereof shall be true and correct in all material respects at and as of the Closing as though such representations and warranties were made at and as of such times; (b) National Cash shall have materially performed and complied with, in all material respects, all covenants, agreements, and conditions required by this Agreement to be performed or complied with by it prior to or at the Closing; (c) no temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Exchange shall be in effect; and (d) the following actions shall have been completed prior to or simultaneous with the Closing of the Exchange.
 
8. Events of Termination. This Agreement may, by notice given in the manner hereinafter provided, be terminated and abandoned at any time prior to completion of the Closing, as follows:

(a) by National Cash if (1) there has been a material breach by URON and, in the case of such a breach relating to a covenant or agreement, such breach shall not have been cured within ten days after receipt by URON of notice specifying particularly such breach, or (2) the closing conditions hereunder in favor of National Cash have not been satisfied by the close of business on April 30, 2008;

(b) by URON (1) if there has been a material breach by National Cash and, in the case of such a breach relating to a covenant or agreement, such breach shall not have been cured within ten days after receipt by National Cash of notice specifying particularly such breach, or (2) if the closing conditions hereunder in favor of URON have not been satisfied by the close of business on April 30, 2008; or

(c) or at any time by mutual written agreement of National Cash and URON.

9. Survival and Indemnification. All representations, warranties, covenants and agreements contained in this Agreement, or in any schedule, certificate, document or statement delivered pursuant hereto, shall survive (and not be affected in any respect by) the Closing, any investigation conducted by any party hereto and any information which any party may receive. Notwithstanding the foregoing, the representations and warranties contained in or made pursuant to this Agreement shall terminate on, and no claim or action with respect thereto may be brought after, the date that URON’s annual report on Form 10-KSB for the year ended December 31, 2008 is filed with the SEC, except that breaches of representations, warranties and covenants arising out of or related to the fraud or willful misconduct of any of the parties shall survive indefinitely. For purposes of determining damages hereunder, damages shall mean any actual and out-of-pocket liabilities, obligations, losses, damages, judgments, penalties, costs, and expenses (including, without limitation, reasonable attorneys’ fees); provided that, in no event shall damages include any special, incidental, punitive, exemplary or consequential damages or any damages for diminution in value. 

10. Nature of Representations. All of the parties hereto are executing and carrying out the provisions of this Agreement in reliance solely on the representations, warranties and covenants and agreements contained in this Agreement and the other documents delivered at the Closing and not upon any representation warranty, agreement, promise or information, written or oral, made by the other party or any other person other than as specifically set forth herein.
 
 
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11. Documents at Closing. At the Closing, the following documents shall be delivered:

(a) National Cash will deliver, or will cause to be delivered, to URON the following: (i) a certificate executed by the Manager of National Cash to the effect that all representations and warranties made by National Cash under this Agreement are true and correct as of the Closing, the same as though originally given to URON on said date; (ii) a certificate from the State of Minnesota dated within ten business days of the Closing to the effect that National Cash is in good standing under the laws of Minnesota; (iii) such other instruments, documents and certificates, if any, as are required to be delivered pursuant to the provisions of this Agreement; (iv) certified copies of resolutions adopted by the board of governors of National Cash authorizing the Exchange; and (v) all other items, the delivery of which is a condition precedent to the obligations of URON, as set forth herein.

(b) URON will deliver or cause to be delivered to National Cash: (i) a certificate of a duly authorized officer of URON, respectively, to the effect that all representations and warranties of URON made under this Agreement are true and correct as of the Closing, the same as though originally given to National Cash and the National Cash Members on said date; (ii) certified copies of resolutions adopted by the board of directors of URON authorizing the Exchange and all related matters; (iii) certificates from the jurisdiction of incorporation of URON dated within ten business days of the Closing Date that each of said corporations is in good standing under the laws of said state; and (iv) such other instruments and documents as are required to be delivered pursuant to the provisions of this Agreement.

12. Miscellaneous.

(a) Severability. If any provision of this Agreement is declared by any court or other Governmental Body to be null, void, or unenforceable, this Agreement shall be construed so that the provision at issue shall survive to the extent it is not so declared null, void, or unenforceable and all of the other provisions of this Agreement shall remain in full force and effect.
(b)  Entire Agreement. This Agreement, together with all exhibits and schedules hereto attached, constitutes the entire agreement among the parties pertaining to the subject matter hereof and completely supersedes all prior or contemporaneous agreements, understandings, arrangements, commitments, negotiations, and discussions of the parties, whether oral or written, all of which shall have no substantive significance or evidentiary effect. Each party acknowledges, represents, and warrants that it has not relied on any representation, agreement, understanding, arrangement, or commitment that has not been expressly set forth in this Agreement. Each party acknowledges, represents and warrants that this Agreement is fully integrated and parol evidence is not needed to reflect the intentions of the parties. The parties specifically intend that the literal words of this Agreement shall, alone, conclusively determine all questions concerning the parties’ intent.
 
(c) Corporate Affairs. Each party will make every reasonable effort to keep confidential any information obtained by them concerning the other party, including its internal organization, finances, procedures, and customers. Neither party will make any public announcement, or release any publicity regarding the other party, other than routine oral communications with analysts, shareholders, and prospective investors without the prior written consent (which shall not be unreasonably withheld or delayed) of the party being named, unless, in the good faith opinion of counsel to the party contemplating such disclosure, such disclosure is required by law and time does not permit the party to obtain such consent, or such disclosure may otherwise be necessary in connection with the filing of Tax Returns, or claims for refunds, or in conducting a Tax audit or other proceedings. This Section shall survive the termination of this Agreement. Notwithstanding anything herein to the contrary, any party (and any employee, representative, or other agent of such party) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax treatment and tax structure. For this purpose, tax treatment and tax structure shall not include the identity of any existing or future party (or any affiliate of such party) to this Agreement.
 
 
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(d) Notices. Unless otherwise expressly provided herein, all notices, requests, demands, instructions, documents, and other communications to be given hereunder by either party to the other shall be in writing, shall be sent to the address/fax number set forth below (provided that any party may at any time change its address for notice or other such information by giving written notice thereof in accordance with this Section), and shall be deemed to be duly given upon the earliest of (a) hand delivery, or (b) the first business day after sending by reputable overnight delivery service for next-day delivery (with confirmation of delivery).
 
If to URON:

URON Inc.
Attention: John Quandahl
2201 West Broadway, Suite 1
Council Bluffs, IA 51501
 
with a copy to:

Maslon Edelman Borman & Brand, LLP
Attention: Paul Chestovich
3300 Wells Fargo Center
90 South Seventh Street
Minneapolis, MN 55402
Fax: (612) 642-8305

If to National Cash:

National Cash, LLC
Attention: Chris Larson
2768 Tyndrum Avenue
Henderson, Nevada 89044   

with a copy to:

Cohne Rappaport & Segal  
257 East 200 South, Suite 700 
Salt Lake City, UT 84111  
Attn: A. O. Headman, Jr.  
Fax No: (801) 355-1813  
 
(e) Amendments; Waivers. This Agreement may not be amended or modified unless such amendment or modification is in writing and signed by all of the parties to this Agreement. The terms, covenants, representations, warranties, or conditions of this Agreement may only be waived in writing. Any waiver of any condition, or of the breach of any provision, term, covenant, representation, or warranty contained in this Agreement, in any one or more instances, shall not be deemed to be or construed as a further or continuing waiver of any condition, or of the breach of any other provision, term, covenant, representation, or warranty of this Agreement. 
 
(f) Successors and Assigns. The rights and obligations under this Agreement may not be assigned or delegated unless in writing executed by the parties hereto, and any attempted assignment or delegation without such prior written consent shall be void and of no force or effect. This Agreement shall inure to the benefit of, and shall be binding upon, the successors and permitted assigns of the parties to this Agreement. 
 
 
14

 
 
(g) Governing Law; Submission to Jurisdiction. This Agreement and all transactions contemplated hereby shall be governed by, and construed and enforced in accordance with, the laws of the State of Minnesota, and shall be treated in all respects as a State of Minnesota contract, without regard to any state’s laws related to choice or conflict of laws. The parties irrevocably agree and consent to the jurisdiction of the courts of the State of Minnesota and the federal courts of the United States sitting in such state for the adjudication of any matters arising under, or in connection with, this Agreement.
 
(h) WAIVER OF JURY TRIAL. THE PARTIES HEREBY IRREVOCABILITY WAIVE ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM, WHETHER AT LAW OR IN EQUITY, ARISING OUT OF, OR RELATING TO, THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
 
(i) Subsequent Documentation. At any time, and from time to time after the Closing Date, each of the parties to this Agreement shall use its best efforts to take such action as may be necessary, or as may be reasonably requested by another party to this Agreement, to carry out and consummate the transactions contemplated by this Agreement. 
 
(j) Counterparts. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by facsimile also shall deliver an original executed counterpart of this Agreement, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement.

(k) Interpretation. In this Agreement, unless a clear contrary intention appears:

(i)  the singular number includes the plural number and vice versa;

(ii)  reference to any Person includes such Person’s successors and assigns, but, if applicable, only if such successors and assigns are not prohibited by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or individually;

(iii)  reference to gender does not exclude the other gender;

(iv)  reference to any agreement, document, or instrument means such agreement, document, or instrument as amended or modified and in effect from time to time in accordance with the terms thereof;

(v)  reference to any legal requirement means such legal requirement as amended, modified, codified, replaced, or reenacted, in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder, and reference to any section or other provision of any legal requirement means that provision of such legal requirement from time to time in effect and constituting the substantive amendment, modification, codification, replacement, or reenactment of such section or other provision;
 
 
15

 
 
(vi)  “hereunder,” “hereof,” “hereto,” and words of similar import shall be deemed references to this Agreement as a whole and not to any particular Article, Section, or other provision hereof;

(vii)  “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding such term;

(viii)  “or” is used in the inclusive sense of “and/or”;

(ix)  with respect to the determination of any period of time, “from” means “from and including” and “to” means “to but excluding”; and

(x)  references to documents, instruments, or agreements shall be deemed to refer as well to all addenda, exhibits, schedules, or amendments thereto.
 
 
16

 
 
IN WITNESS WHEREOF, the parties have executed this Exchange Agreement as of February 26, 2008, but to be effective as of the date first above written.
 
     
 
URON INC.
 
 
 
 
 
 
By:   /s/ Steve Staehr
 
Steve Staehr, Chief Financial Officer
     
 
NATIONAL CASH & CREDIT, LLC
 
 
 
 
 
 
By:  
/s/ Christopher Larson 
 
Christopher Larson, Manager
     
 
“National Cash Members”:
 
 
 
        
 
 
  
/s/ Christopher Larson
 
Christopher Larson
     
 
CCC, LLC
 
 
 
 
 
 
By:  
/s/ Christopher Larson
 
Christopher Larson, Manager
     
 
L&C, LLC
 
 
 
 
 
 
By:  
/s/ Christopher Larson
 
Christopher Larson, Manager
 
Signature Page to Exchange Agreement
 
 
 

 
 
EX-3.1 3 v108896_ex3-1.htm



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ARTICLES OF AMENDMENT

TO THE ARTICLES OF INCORPORATION
OF
URON INC.

THE UNDERSIGNED, Chief Executive Officer of URON Inc., a Minnesota corporation (the “Corporation”), hereby certifies that these Articles of Amendment have been duly adopted by the Corporation’s board of directors pursuant to the provisions of the Minnesota Business Corporation Act:

1. The name of the Corporation is: URON Inc.

2. Section 3.01 of the Corporation’s Amended and Restated Articles of Incorporation is amended by deleting Section 3.01 thereof in its entirety and substituting in lieu thereof a new Section 3.01 to read in its entirety as follows:

3.01 The aggregate number of shares of capital stock which this Corporation shall have authority to issue is 20,000,000, no par value per share.

3. This amendment is a result of the Corporation’s 1-for-10 stock combination declared by the Corporation’s board of directors to be effective for the holders of the Corporation’s capital stock of record as of the close of business on the date of filing of these Articles of Amendment.

4. This amendment will not adversely affect the rights or preferences of the holders of outstanding shares of any class or series and will not result in the percentage of authorized shares of any class or series that remains unissued after the division or combination exceeding the percentage of authorized shares of that class or series that were unissued before the division or combination.

5. This amendment has been adopted pursuant to Chapter 302A of the Minnesota Statutes, also called the Minnesota Business Corporation Act.

6. This amendment shall be effective as of the date of filing with the Minnesota Secretary of State.
 
IN WITNESS WHEREOF, the undersigned has hereunto set his hand on this 29th day of November, 2007.
 
       
     
URON INC.
       
       
    /s/ Christopher Larson
   
Christopher Larson
Chief Executive Officer
 
 
 

 
 
EX-3.5 7 v108896_ex3-5.htm
ARTICLES OF AMENDMENT
TO THE ARTICLES OF INCORPORATION OF
URON INC.
 
The undersigned duly authorized officer of URON Inc., a corporation organized under the laws of the State of Minnesota, to amend its Articles of Incorporation, as amended and restated on May 30, 2007 (the “Articles of Incorporation”), in accordance with the Minnesota Business Corporation Act, hereby certifies:

FIRST: The name of the corporation is URON Inc.

SECOND: Article III of the Articles of Incorporation is hereby amended to read in its entirety as follows:

ARTICLE III
CAPITAL

A. The corporation is authorized to issue 250,000,000 shares of capital stock, each having no par value per share (unless, in the case of a certificate of designation setting out the rights, preferences and privileges of any preferred stock, otherwise designated by the board of directors). Each share of the corporation’s common stock shall be entitled to one vote on all matters requiring a vote of the corporation’s shareholders. Unless otherwise specifically so designated upon issuance, all shares of capital issued by the corporation shall be common stock.
 
B. In addition to any and all powers conferred upon the corporation’s board of directors by the laws of the State of Minnesota, the board of directors shall have the authority to establish by resolution more than one class or series of capital stock, common or preferred, and to fix the relative rights, restrictions and preferences of any such different classes or series, and to issue shares of a class or series to another class or series to effectuate share dividends, splits or conversions of the corporation’s outstanding shares.
 
C. The board of directors shall also have the authority to issue rights to convert any of the corporation’s securities into shares of stock of any permitted class or classes, the authority to issue options to purchase or subscribe for shares of stock of any permitted class or classes, and the authority to issue share-purchase or subscription warrants or any other evidence of such option rights which set forth the terms, provisions and conditions thereof, including the price or prices at which such shares may be subscribed for or purchased. Such options, warrants and rights may be transferable or nontransferable and separable or inseparable from the corporation’s other securities. The board of directors is authorized to fix the terms, provisions and conditions of such options, warrants and rights, including the conversion basis or bases and the option price or prices at which shares may be subscribed for or purchased.
 
D. No shareholder of the corporation shall have any preemptive rights.
 
E. No shareholder of the corporation shall have any cumulative-voting rights.
 

 
THIRD: The foregoing amendment to the Articles of Incorporation shall be effective upon the filing of these Articles of Amendment.

IN WITNESS WHEREOF, URON Inc. has caused its duly authorized officer to execute this certificate on this 17th day of March, 2008.
 
       
/s/ Christopher Larson    

Christopher Larson,
   
President and Chief Executive Officer
     
 
 
 

 
EX-3.6 8 v108896_ex3-6.htm Unassociated Document
 
BYLAWS OF
URON INC.
 
Article I.
OFFICES
 
Section 1.01. Registered and Other Offices. The registered office of the corporation in Minnesota shall be that set forth in the Articles of Incorporation or in the most recent amendment of the Articles of Incorporation or statement of the Board of Directors filed with the Secretary of Minnesota changing the registered office in the manner prescribed by law. The corporation may have such other offices, within or without the state of Minnesota, as the Board of Directors shall, from time to time, determine.
 
ARTICLE II.
MEETINGS OF SHAREHOLDERS
 
Section 2.01. Time and Place of Meetings. Regular or special meetings of the shareholders, if any, shall be held on the date and at the time and place fixed by the Chief Executive officer, the Chairman of the Board, or the Board, except that a regular or special meeting called by, or at the demand of the shareholder or shareholders, pursuant to Minnesota Statutes, Section 302A.43a Subd. 2, shall be held in the country where the principal executive office is located.
 
Section 2.02. Regular Meetings. At any regular meeting of the shareholders there shall be an election of qualified successors for directors who serve for an indefinite term or whose terms have expired or are due to expire within one year after the date of the meeting. Any business appropriate for action by the shareholders may be transacted at a regular meeting. No meeting shall be considered a regular meeting unless specifically designated as such in the notice of meeting or unless all the shareholders are present in person or by proxy and none of them objects to such designation. Regular meetings may be held no more frequently than once per year.
 
Section 2.03. Demand by Shareholders. Regular or special meetings may be demanded by a shareholder or shareholders, pursuant to the provisions of Minnesota Statutes, Sections 302A, Subd. 2, and 301A.433, Subd 2, respectively.
 
Section 2.04. Quorum; Adjourned Meetings. The holders of thirty-three percent (33%) of the voting power of the shares entitled to vote at a meeting constitute a quorum for the transaction of business; said holders may be present at the meeting either in person or by proxy. If a quorum is present when a duly called or held meeting is convened, the shareholders present may continue to transact business until adjournment, even though withdrawal of shareholders originally present leaves less than the proportion or number otherwise required for a quorum. In case a quorum shall not be present in person or by proxy at a meeting, those present in person or by proxy may adjourn to such day as they shall, by majority vote, agree upon, and a notice of such adjournment shall be mailed to each shareholder entitled to vote at least five (5) days before such adjourned meeting. If a quorum is present in person or by proxy, a meeting may be adjourned from time to time without notice, other than announcement at the meeting. At adjourned meetings at which a quorum is present in person or by proxy, any business may be transacted at the meeting as originally noticed.
 
Section 2.05. Voting. At each meeting of the shareholders, every shareholder having the right to vote shall be entitled to vote either in person or by proxy. Unless otherwise provided by the Articles of Incorporation or a resolution of the Board of Directors filed with the Secretary of State, each shareholder shall have one vote for each share held. Upon demand of any shareholder, the vote upon any question before the meeting shall be by ballot.
 
 

 
Section 2.06. Notice of Meetings. Notice of all meetings of shareholders shall be given to every holder of voting shares, except where the meeting is an adjourned meeting and the date, time and place of the meeting were announced at the time of adjournment. The notice shall be given at least fourteen (14), but not more than sixty (60) days before the date of the meeting, except that written notice of a meeting at which an agreement of merger is to be considered shall be given to all shareholders, whether entitled to vote or not, at least fourteen (14) days prior thereto. Every notice of any special meeting shall state the purpose or purposes for which the meeting has been called, and the business transacted at all special meetings shall be confined to the purpose stated in the call, unless all of the shareholders are present in person or by proxy and none of them objects to consideration of a particular item of business.
 
Section 2.07. Waiver of Notice. A shareholder may waive notice of any meeting of shareholders. A waiver of notice by a shareholder entitled to notice is effective whether given before, at or after the meeting and whether given in writing, orally or by attendance.
 
Section 2.08. Authorization Without a Meeting. Any action required or permitted to be taken at a meeting of the shareholders may be taken without a meeting as authorized by law.
 
Section 2.09. Record Date. The Board of Directors may fix a time, not exceeding sixty (60) days preceding the date of any meeting of shareholders, as a record date for the determination of the shareholders entitled to notice of and to vote at such meeting, notwithstanding any transfer of shares on the books of the corporation after any record date is so fixed. The Board of Directors may close the books of the corporation against the transfer of shares during the whole or any part of such period. If the Board of Directors fails to fix a record date for the determination of the shareholders entitled to notice of and to vote at any meeting of the shareholders, the record date shall be the twentieth (20th) day preceding the date of such meeting.
 
ARTICLE III.
DIRECTORS
 
Section 3.01. General Purposes. Except as authorized by the shareholders pursuant to a shareholder control agreement of unanimous affirmative vote, the business and affairs of the corporation shall be managed by or shall be under the direction of the Board of Directors.
 
Section 3.02. Number, Qualifications and Term of Office. The number of directors shall be the number last elected by the shareholders; provided that between regular meeting of shareholders the Board of Directors may increase the authorized number of directors and elect persons to fill the new positions. Directors need not be shareholders. Each of the directors shall hold office until the regular meeting of the shareholders next held after his election, until his successor shall have been elected and shall qualify, or until he shall resign or shall have been removed as hereinafter provided.
 
Section 3.03. Board Meetings; Place and Notice. Meetings of the Board of Directors may be held from time to time at any place within or without the State of Minnesota that the Board of Directors may designate. In the absence of designation by the Board of Directors, Board meetings shall be held at the principal executive office of the corporation, except as may be otherwise unanimously agreed orally or in writing or by attendance. Any director may call a Board meeting by giving two (2) days notice to all directors of the date and time of the meeting. The notice need not state the purpose of the meeting. Notice may be given by mail, telephone, telegram or in person. If the meeting schedule is adopted by the Board, or if the date and time of a Board meeting has been announced at a previous meeting, no notice is required.
 

 
 

 
 
Section 3.04. Waiver of Notice. A director may waive notice of a meeting of the Board. A. waiver of notice by a director is effective, whether given before, at or after the meeting and whether given in writing, orally or by attendance.
 
Section 3.05. Quorum. A. majority of the directors currently holding office is a quorum for the transaction of business.
 
Section 3.06. Vacancies. Vacancies on the Board resulting from the death, resignation or removal of a director may be filled by the affirmative vote of a majority of the remaining directors, even though less than a quorum. Each director elected under this Section to fill a vacancy holds office until a qualified successor is elected by the shareholders at the next regular or special meeting of the shareholders.
 
Section 3.07. Committees. The Board may by resolution establish committees in the manner provided by law. Committee members need not be directors.
 
Section 3.08. Absent Directors. A director may give advance written consent or opposition to a proposal to be acted on at a Board meeting if the director is not able to be present.
 
ARTICLE IV.
OFFICERS
 
Section 4.01. Number. The officers of the corporation shall consist of a Chief Executive Officer and a Chief Financial Officer. The Chief Executive Officer shall preside at all meetings of the shareholders and directors and shall have such other duties as may be prescribed from time to time by the ward of Directors. The Chief Executive Officer shall also see that all orders and resolutions of the Board are carried into effect. The Chief Executive Officer and Chief Financial Officer shall have such other duties as are prescribed by statute. The Board may elect or appoint any other officers it deems necessary for the operation and management of the corporation, each of whom shall have the powers, rights, duties, responsibilities and terms of office determined by the Board from time to time. Any number of offices or functions of those offices may be held or exercised by the same person. If specific persons have not been elected as President or Secretary, the Chief Executive Officer may execute instruments or documents in those capacities. If a specific person has not been elected to office of Treasurer, the Chief Financial Officer of the corporation may sign instruments or documents in that capacity.
 
Section 4.02. Election and Term of Office. The Board of Directors shall from time to time elect a Chairman of the Board of Directors, Chief Executive Officer and Chief Financial Officer and any other officers or agents the Bawd deems necessary. Such officers shall hold their offices until their successors are elected and qualified.
 
Section 4,03. Delegation of Authority. An officer elected or appointed by the Board may delegate some or all of the duties or powers of his office to other persons, provided that such delegation is in writing.
 
Section 4.04. Compensation of Officers. Officer shall be entitled only to such compensation as shall be established by written contract or agreement duly approved by or on behalf of the corporation, or established or approved by resolution of the Board of Directors. Absent such written contract, agreement or resolution of the Board of Directors, no officer shall have a cause of action against the corporation to recover any amount due or alleged to be due as compensation for services in his or her capacity as an officer of the corporation.
 

 
 

 
 
 
ARTICLE V.
SHARES AND THEIR TRANSFER
 
Section 5.01. Certificates for Shares. Every shareholder of this corporation shall be entitled to a certificate, to be in such form as prescribed by law and adopted by the Board of Directors, certifying the number of shares of the corporation owned by him. The certificates shall be signed by the Chief Executive Officer and Chief Financial Officer. provided, however, that when the certificate is signed by a transfer agent or registrar, the signatures of any of such officers upon the certificate may be facsimiles, engraved or printed thereon, if authorized by the Board of Directors. Such certificate shall also have typed or printed thereon such legend as may be required by any shareholder control agreement. Every certificate surrendered to the corporation for exchange or transfer shall be cancelled, and no new certificate or certificates shall be issued in exchange for any existing certificate until such existing certificate shall have been so cancelled.
 
Section 5.02. Transfer of Shares. Transfer of shares on the books of the corporation may be authorized only by the shareholder named in the certificate, or the shareholder's legal representative, or the shareholders' duly authorized attorney in fact, and upon surrender of the certificate or the certificates for such shares. The corporation may treat, as the absolute owner of shares of the corporation, the person or persons in whose name or names the shares are registered on the books of the corporation.
 
Section 5.03. Lost Certificates. Any shareholder claiming that a certificate for shares has been lost, destroyed or stolen shall make an affidavit of that fact in such form as the Board of Directors shall require and shall, if the Board of Directors so requires, give the corporation sufficient indemnity bond, in form, in an amount, and with one or more sureties satisfactory to the Board of Directors, to indemnify the corporation against any claims which may be made against it on account of the reissue of such certificate. A new certificate shall then be issues to said shareholder for the same number of shares as the one alleged to have been destroyed, lost or stolen.
 

 
Adopted: January 4, 2006 (amended on May 25, 2007)
EX-10.1 9 v108896_ex10-1.htm
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, OR ANY APPLICABLE STATE SECURITIES LAWS. AS A RESULT, THIS WARRANT AND SUCH SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR EVIDENCE SATISFACTORY TO THE COMPANY OF AN APPLICABLE EXEMPTION FROM REGISTRATION UNDER THE ACT OR COMPLIANCE WITH RULE 144 UNDER SUCH ACT. THE TRANSFER OF THIS WARRANT IS FURTHER RESTRICTED AS PROVIDED HEREIN.
 
WARRANT TO PURCHASE SHARES
OF COMMON STOCK
OF URON INC.
 
EXERCISABLE ON OR BEFORE, AND VOID AFTER
5:00 P.M. MINNEAPOLIS TIME ON NOVEMBER 29, 2012
 

THIS CERTIFIES THATLantern Advisors, LLC, a Minnesota limited liability company (the “Holder”), or registered assigns, is entitled to subscribe for and purchase from URON Inc., a Minnesota corporation (the “Company”), at any time permitted hereunder after November 29, 2007, and through November 29, 2012 (subject to the terms and provisions of this Warrant), up to 400,000 shares of the Company’s common stock at an exercise price of $0.01 per share, subject to adjustment as provided herein (as adjusted, the “Purchase Price”).
 
The shares that may be acquired upon exercise of this Warrant are referred to herein as the “Warrant Shares.” As used herein, the term “Holder” means the Holder identified in the paragraph above and any party who acquires all or a part of this Warrant as a registered transferee of such Holder. The term “Convertible Securities” means any stock or other securities convertible into, or exchangeable for, Company common stock. This Warrant is subject to the following terms and conditions:
 
1. Exercise. The rights represented by this Warrant may be exercised by the Holder, in whole or in part (but not as to a fractional share of common stock), by written Notice of Exercise (in the form attached hereto) delivered to the Company at its principal office prior to the expiration of this Warrant and accompanied or preceded by the surrender of this Warrant, along with a check in payment of the Purchase Price multiplied by the number of Warrant Shares being purchased hereunder (unless this Warrant is being exercised pursuant to Section 9 below). The right to exercise this Warrant shall vest only upon a change in control of the Company, which shall be deemed to occur upon any of the following: (a) an acquisition by one or more individuals, entities or associations of effective control (whether through legal or beneficial ownership of capital stock, by contract or otherwise) of more than 33% of the voting securities of the Company, or (b) a merger or consolidation of the Company or any of its affiliates (specifically including but not limited to a subsidiary), with or into any other entity or association, or the merger or consolidation of any other entity or association with or into the Company or any of its affiliates (specifically including but not limited to a subsidiary). As used herein, the term “affiliates” shall have the meaning ascribed to such term under the Securities Act of 1933.
 
2. Exchange and Replacement. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction, or mutilation of this Warrant, the Company will make and deliver a new Warrant of like tenor, in lieu of this Warrant. This Warrant shall be promptly canceled by the Company upon the surrender hereof in connection with any exchange or replacement.
 
 

 
3. Issuance of the Warrant Shares.
 
(a) Subject to the provisions of paragraph (b) below, certificates for the Warrant Shares purchased hereunder shall be delivered to the Holder within a reasonable time, not exceeding five business days, after the rights represented by this Warrant shall have been exercised in accordance with the requirements hereof, and, unless this Warrant has expired, a new Warrant representing the right to purchase the number of Warrant Shares, if any, with respect to which this Warrant shall not then have been exercised shall also be delivered to the Holder within such time.
 
(b) Notwithstanding the foregoing, the Company shall not be required to recognize any exercise, or deliver any certificate for Warrant Shares upon attempted exercise, of this Warrant except in accordance with exemptions from the applicable securities, registration requirements or registrations under applicable securities laws. The Company shall not be obligated to effect a registration of the Warrant Shares under federal or state securities laws unless specifically so provided herein. The Holder agrees to execute such documents and make such representations, warranties and agreements as may be required solely to comply with the exemptions relied upon by the Company, or the registrations made, for the issuance of the Warrant Shares or their later resale pursuant to a registration statement filed by the Company.
 
4. Covenants of the Company. The Company covenants and agrees that during the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized for the purpose of issue or transfer upon exercise of the subscription rights evidenced by this Warrant a sufficient number of shares of common stock to provide for the exercise of the rights represented by this Warrant.
 
5. Purchase Price and Warrant Share Adjustments. The provisions of this Warrant are subject to adjustment as provided in this Section 5.
 
(a) Subject to paragraph (c) below, in case the Company shall hereafter: (i) pay any dividends on any class of stock of the Company payable in common stock or Convertible Securities; (ii) subdivide its then-outstanding shares of common stock into a greater number of shares; or (iii) combine outstanding shares of common stock, by reclassification or otherwise; then, in any such event, the Purchase Price in effect immediately prior to such event shall (until adjusted again pursuant hereto) be adjusted immediately after such event to a price (calculated to the nearest full cent) determined by dividing (A) the number of shares of common stock outstanding immediately prior to such event, multiplied by the then-existing Purchase Price, by (B) the total number of shares of common stock outstanding immediately after such event (including in each case the maximum number of shares of common stock issuable in respect of any Convertible Securities), and the resulting quotient shall be the adjusted Purchase Price. An adjustment made pursuant to this paragraph shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. If, as a result of an adjustment made pursuant to this paragraph, the Holder of any Warrant thereafter surrendered for exercise shall become entitled to receive shares of two or more classes of capital stock of the Company, the Company’s board of directors (whose determination shall be conclusive) shall determine the allocation of the adjusted Purchase Price between or among shares of such classes of capital stock or shares of common stock and other-capital stock. All calculations under this paragraph shall be made to the nearest cent or to the nearest 1/100 of a share, as the case may be. In the event that at any time as a result of an adjustment made pursuant to this paragraph, the holder of any Warrant thereafter surrendered for exercise shall become entitled to receive any shares of the Company other than shares of common stock, thereafter the Purchase Price of such other shares so receivable upon exercise of any Warrant shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to common stock contained in this Section.
 
2

 
(b) In case of any consolidation or merger to which the Company is a party other than a merger or consolidation in which the Company is the surviving corporation, or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, or in the case of any statutory exchange of securities with another corporation (including any exchange effected in connection with a merger of a third corporation into the Company), there shall be no adjustment under paragraph (a) above but the Holder of this Warrant then outstanding shall have the right thereafter to convert this Warrant into the kind and amount of shares of stock and other securities, and any other property, which he, she or it would have owned or have been entitled to receive immediately after such consolidation, merger, statutory exchange sale or conveyance had such Warrant been converted immediately prior to the effective date of such consolidation, merger, statutory exchange, sale or conveyance. The provisions of this paragraph shall similarly apply to successive consolidations, mergers, statutory exchanges, sales or conveyances.
 
(c) Notwithstanding the provisions of paragraph (a) above, no adjustment to the number of Warrant Shares purchasable hereunder or the Purchase Price shall be made in connection with any stock combination (i.e., reverse stock split) effected in connection with any merger transaction (or associated agreements) involving Checkmate Consumer Lending Corporation, a Delaware corporation, or Wyoming Financial Lenders, Inc., a Wyoming corporation.
 
6. No Voting Rights. This Warrant by itself shall not entitle the Holder to any voting rights or other rights as a stockholder of the Company.
 
7. Notice of Transfer of Warrant or Resale of the Warrant Shares.
 
(a) By acceptance hereof, the Holder agrees to give written notice to the Company before transferring this Warrant or transferring any Warrant Shares of such Holder’s intention to do so, describing briefly the manner of any proposed transfer. If in the opinion of counsel to the Company the proposed transfer may be effected without registration or qualification (under any federal and state securities laws), the Company, as promptly as practicable, shall notify the Holder of such opinion, whereupon the Holder shall be entitled to transfer this Warrant or to dispose of Warrant Shares received upon the previous exercise of this Warrant, all in accordance with the terms of the notice delivered by the Holder to the Company; provided, however, that an appropriate legend may be endorsed on this Warrant or the certificates for such Warrant Shares respecting restrictions upon transfer thereof necessary or advisable in the opinion of counsel and satisfactory to the Company to prevent further transfers which would be in violation of Section 5 of the Securities Act of 1933 (the “Securities Act”) and applicable state securities laws; and provided further that the prospective transferee or purchaser shall execute such documents and make such representations, warranties, and agreements as may be required solely to. comply with the exemptions relied upon by the Company for the transfer of disposition of the Warrant or Warrant Shares.
 
3

 
(b) If, in the opinion of counsel referred to in this Section 7, the proposed transfer or disposition of this Warrant or such Warrant Shares described in the written notice given pursuant to this Section 7 may not be effected without registration or qualification of this Warrant or such Warrant Shares the Company shall promptly give written notice thereof to the Holder, and the Holder will limit its activities in respect to such transfer or disposition as, in the opinion of both such counsel, are permitted by law.
 
8. No Fractional Shares. No fractional shares will be issued upon the exercise hereof.
 
9. Net Issue Exercise. In lieu of exercising this Warrant pursuant to Section 1 hereof, the Holder may elect to receive, without the payment of any additional consideration, a number of Warrant Shares equal to the value (as determined below) of this Warrant (or the portion thereof being exercised) by surrender of this Warrant to the Company together with a duly executed Notice of Exercise (in the form attached hereto) in which the appropriate alternative is initialed by the Holder. In such event, the Company shall issue to the Holder the number of Warrant Shares computed by applying the following formula:
 
X = Y (A-B)
A
Where:
 
X
  =   the number of Warrant Shares to be issued to the Holder;
         
Y
  =   the number of Warrant Shares subject to this warrant (or, if only a  portion of this Warrant is being exercised, the number of Warrant Shares  subject to the portion of this Warrant being exercised);
 
       
A
  =   the Fair Market Value of one Warrant Share (at the date of such exercise); and
         
B
  =   the Purchase Price, as adjusted to the date of such calculation.
 
For purposes of the above, the “Fair Market Value” of one share shall equal the average of the closing sale prices of the common stock quoted on a Nasdaq Stock Market, the AMEX, or NYSE (collectively, a “Stock Exchange”), or listed in the Over-The-Counter Bulletin Board (or the Pink Sheets) or the closing price quoted on any national securities exchange on which such securities are listed, whichever is applicable, for the ten consecutive trading days immediately prior to the date of determination of Fair Market Value (or, if no sales take place on any such trading day, the average of the closing bid and asked prices on such trading day). If, however, the common stock is not traded on a Stock Exchange or the Over-The-Counter Bulletin Board or Pink Sheets, the Fair Market Value of a Warrant Share shall be determined in good faith by the Company’s board of directors.
 
10. Registration Rights.
 
(a) Subject to paragraph (d) of this Section, each time the Company shall determine to proceed with the actual preparation and filing of a registration statement under the Securities Act, in connection with the proposed offer and sale for money of any of its securities by it (other than a registration on Form S-8, S-4 or any successor forms or other inappropriate forms), the Company will give written notice of its determination to Holder. Upon the written request of Holder given within 30 days after receipt of any such notice from the Company, the Company will, except as herein provided, cause all Warrant Shares with respect to which Holder has requested registration to be included in such registration statement, all to the extent requisite to permit the sale or other disposition by Holder of the shares to be so registered; provided, however, that nothing herein shall prevent the Company from, at any time, abandoning or delaying any such registration initiated by it. If any such registration pertains to an underwritten offering in whole or in part, the Company may require that the shares requested for inclusion by Holder pursuant to this section be included in the underwritten offering on the same terms and conditions as the securities otherwise being sold through the underwriters. If, in the good faith judgment of the managing underwriter of such underwritten offering, the inclusion of all of the Warrant Shares originally covered by a request for registration made by Holder would reduce the amount of securities to be offered by the Company or interfere with the successful marketing of the securities to be offered by the Company, the number of Warrant Shares owned by or issuable to Holder and otherwise to be included in the underwritten offering may be reduced. Any Warrant Shares which are thus excluded from the underwritten offering shall be withheld from the market by Holder for a period, not to exceed 180 days, that the managing underwriter reasonably determines is necessary in order to effect the underwritten offering.
 
4

 
(b) If and whenever the Company is required by the provisions of Section 10(a) to effect the registration of any Warrant Shares under the Securities Act, the Company will:
 
(i) prepare and file with the SEC a registration statement with respect to such shares, and use reasonable commercial efforts to cause such registration statement to become and remain effective for such period as may be reasonably necessary to effect the sale of such shares, not to exceed two years from the date of issuance of the covered Warrant Shares;

(ii) prepare and file with the SEC such amendments to such registration statement and supplements to the prospectus contained therein as may be necessary to keep such registration statement effective for such period as may be reasonably necessary to effect the sale of such securities, not to exceed two years from the date of issuance of the covered Warrant Shares;

(iii) furnish to Holder and to the underwriters of the securities being registered such reasonable number of copies of the registration statement, preliminary prospectus, final prospectus and such other documents as Holder and underwriters may reasonably request in order to facilitate the public offering of such securities;

(iv) use reasonable commercial efforts to register or qualify the securities covered by such registration statement under such state securities or blue sky laws of such jurisdictions as the underwriters may reasonably request within 20 days following the original filing of such registration statement, except that the Company shall not for any purpose be required to execute a general consent to service of process or to qualify to do business as a foreign corporation in any jurisdiction wherein it is not so qualified; and

(v) prepare and promptly file with the SEC any amendment or supplement to such registration statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to such securities is required to be delivered under the Securities Act, any event shall have occurred as the result of which any such prospectus or any other prospectus as then in effect would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading.
 
5


(c) With respect to any registration of shares pursuant to Section 10(a), the Company shall bear the following fees, costs and expenses: all registration, filing and NASD fees, printing expenses, fees and disbursements of counsel and accountants for the Company, fees and disbursements of counsel for the underwriter or underwriters of such securities (if the Company and/or selling security holders are required to bear such fees and disbursements), all internal Company expenses, the premiums and other costs of policies of insurance against liability arising out of the public offering, and all legal fees and disbursements and other expenses of complying with state securities or blue sky laws of any jurisdictions in which the securities to be offered are to be registered or qualified. Fees and disbursements of counsel and accountants for Holder, underwriting discounts and commissions and transfer taxes for Holder and any other expenses incurred by Holder not expressly included above shall be borne by Holder.
 
(d) Notwithstanding anything to the contrary herein, the Company shall not be obligated to register the resale of (i) any Warrant Shares purchased for cash which have been outstanding for more than two years or (ii) any Warrant Shares, purchased pursuant to Section 9, after November 29, 2010.


IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer.
 
      URON INC.:
       
   
By: 
/s/ Christopher Larson
   
Christopher Larson
 Chief Executive Officer
 
6


NOTICE OF EXERCISE

(To be signed upon exercise of Warrant)
 
The Undersigned, the holder of the within Warrant, hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, of the shares of common stock of URON Inc. to which such Warrant relates and herewith makes payment of $______________________ therefor in cash or by certified check (unless the Warrant is being exercised pursuant to Section 9, in which case the box below indicating such fact is checked), and requests that the certificate for such shares be issued in the name of, and be delivered to,   ________________ the address for which is set forth below the signature of the undersigned.
 
The undersigned is exercising the Warrant pursuant to the Net Issue Exercise provisions of Section 9.

 
Dated: _______________________, 20____
 
 
________________________________________________________
Signature

 
________________________________________________________
Name


________________________________________________________
Address

 
________________________________________________________
City, State, Zip Code


________________________________________________________
Social Security or Tax Identification No.
 
7



ASSIGNMENT FORM
 
(To be signed only upon authorized transfer of Warrant)

 
For Value Received, the undersigned hereby sells, assigns, and transfers unto _______________________________ the right to purchase the securities of URON Inc., a Minnesota corporation, to which the within Warrant relates and appoints ______________________, attorney, to transfer said right on the books of URON Inc. with full power of substitution in the premises.
 
 
Dated: _______________________, 20____
 
________________________________________________________
Signature

 
________________________________________________________
Name


________________________________________________________
Address

 
________________________________________________________
City, State, Zip Code


________________________________________________________
Social Security or Tax Identification No.
 
 

EX-10.2 10 v108896_ex10-2.htm
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. AS A RESULT, THIS WARRANT AND SUCH SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR EVIDENCE SATISFACTORY TO THE COMPANY OF AN APPLICABLE EXEMPTION FROM REGISTRATION UNDER THE ACT OR COMPLIANCE WITH RULE 144 UNDER SUCH ACT. THE TRANSFER OF THIS WARRANT IS FURTHER RESTRICTED AS PROVIDED HEREIN.
 
WARRANT TO PURCHASE SHARES
OF COMMON STOCK
OF URON INC.
 
EXERCISABLE ON OR BEFORE, AND VOID AFTER
 
5:00 P.M. MINNEAPOLIS TIME ON JULY 5, 2012
 
This Certifies That Donald Miller (the “Holder”), or registered assigns, is entitled to subscribe for and purchase from URON Inc., a Minnesota corporation (the “Company”), at any time after July 5, 2007, through July 5, 2012, 100,000 shares of the Company’s common stock at an exercise price of $0.15 per share, subject to adjustment as provided herein (as adjusted, the “Purchase Price”).
 
The shares that may be acquired upon exercise of this Warrant are referred to herein as the “Warrant Shares.” As used herein, the term “Holder” means the Holder identified in the paragraph above and any party who acquires all or a part of this Warrant as a registered transferee of such Holder. The term “Convertible Securities” means any stock or other securities convertible into, or exchangeable for, Company common stock. This Warrant is subject to the following terms and conditions:
 
1. Exercise. The rights represented by this Warrant may be exercised by the Holder, in whole or in part (but not as to a fractional share of common stock), by written Notice of Exercise (in the form attached hereto) delivered to the Company at the principal office of the Company prior to the expiration of this Warrant and accompanied or preceded by the surrender of this Warrant along with a check in payment of the Purchase Price multiplied by the number of Warrant Shares being purchased hereunder, unless this Warrant is being exercised pursuant to Section 9 below.
 
2. Exchange and Replacement. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction, or mutilation of this Warrant, the Company will make and deliver a new Warrant of like tenor, in lieu of this Warrant. This Warrant shall be promptly canceled by the Company upon the surrender hereof in connection with any exchange or replacement.
 
3. Issuance of the Warrant Shares.
 
(a) Subject to the provisions of paragraph (b) below, certificates for the Warrant Shares purchased hereunder shall be delivered to the Holder within a reasonable time, not exceeding ten days, after the rights represented by this Warrant shall have been so exercised, and, unless this Warrant has expired, a new Warrant representing the right to purchase the number of Warrant Shares, if any, with respect to which this Warrant shall not then have been exercised shall also be delivered to the Holder within such time.
 

 
(b) Notwithstanding the foregoing, the Company shall not be required to recognize any exercise or deliver any certificate for Warrant Shares upon attempted exercise of this Warrant except in accordance with exemptions from the applicable securities, registration requirements or registrations under applicable securities laws. The Company shall not be obligated to effect a registration of the Warrant Shares under federal or state securities laws unless specifically so provided herein. The Holder agrees to execute such documents and make such representations, warranties, and agreements as may be required solely to comply with the exemptions relied upon by the Company, or the registrations made, for the issuance of the Warrant Shares.
 
4. Covenants of the Company. The Company covenants and agrees that during the period within which the rights represented by this Warrant may be exercised, the Company will at all times have authorized for the purpose of issue or transfer upon exercise of the subscription rights evidenced by this Warrant a sufficient number of shares of common stock to provide for the exercise of the rights represented by this Warrant.
 
5. Purchase Price Adjustments. The provisions of this Warrant are subject to adjustment as provided in this Section 5.
 
(a) In case the Company shall hereafter: (i) pay any dividends on any class of stock of the Company payable in common stock or Convertible Securities; (ii) subdivide its then-outstanding shares of common stock into a greater number of shares; or (iii) combine outstanding shares of common stock, by reclassification or otherwise; then, in any such event, the Purchase Price in effect immediately prior to such event shall (until adjusted again pursuant hereto) be adjusted immediately after such event to a price (calculated to the nearest full cent) determined by dividing (A) the number of shares of common stock outstanding immediately prior to such event, multiplied by the then-existing Purchase Price, by (B) the total number of shares of common stock outstanding immediately after such event (including in each case the maximum number of shares of common stock issuable in respect of any Convertible Securities), and the resulting quotient shall be the adjusted Purchase Price. An adjustment made pursuant to this paragraph shall become effective immediately after the record date in the case of a dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification. If, as a result of an adjustment made pursuant to this paragraph, the Holder of any Warrant thereafter surrendered for exercise shall become entitled to receive shares of two or more classes of capital stock or share of common stock and other capital stock of the Company, the Company’s board of directors (whose determination shall be conclusive) shall determine the allocation of the adjusted Purchase Price between or among shares of such classes of capital stock or shares of common stock and other-capital stock. All calculations under this paragraph shall be made to the nearest cent or to the nearest 1/100 of a share, as the case may be. In the event that at any time as a result of an adjustment made pursuant to this paragraph, the holder of any Warrant thereafter surrendered for exercise shall become entitled to receive any shares of the Company other than shares of common stock, thereafter the Purchase Price of such other shares so receivable upon exercise of any Warrant shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to common stock contained in this Section.
 
(b) In case of any consolidation or merger to which the Company is a party other than a merger or consolidation in which the Company is the surviving corporation, or in case of any sale or conveyance to another corporation of the property of the Company as an entirety or substantially as an entirety, or in the case of any statutory exchange of securities with another corporation (including any exchange effected in connection with a merger of a third corporation into the Company), there shall be no adjustment under paragraph (a) above but the Holder of this Warrant then outstanding shall have the right thereafter to convert this Warrant into the kind and amount of shares of stock and other securities, and any other property, which he, she or it would have owned or have been entitled to receive immediately after such consolidation, merger, statutory exchange sale or conveyance had such Warrant been converted immediately prior to the effective date of such consolidation, merger, statutory exchange, sale or conveyance. The provisions of this paragraph shall similarly apply to successive consolidations, mergers, statutory exchanges, sales or conveyances.
 
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6. No Voting Rights. This Warrant by itself shall not entitle the Holder to any voting rights or other rights as a stockholder of the Company.
 
7. Notice of Transfer of Warrant or Resale of the Warrant Shares.
 
(a) The Holder, by acceptance hereof, agrees to give written notice to the Company before transferring this Warrant or transferring any Warrant Shares of such Holder’s intention to do so, describing briefly the manner of any proposed transfer. If in the opinion of the Company counsel the proposed transfer may be effected without registration or qualification (under any federal or state securities laws), the Company, as promptly as practicable, shall notify the Holder of such opinion, whereupon the Holder shall be entitled to transfer this Warrant or to dispose of Warrant Shares received upon the previous exercise of this Warrant, all in accordance with the terms of the notice delivered by the Holder to the Company; provided, however, that an appropriate legend may be endorsed on this Warrant or the certificates for such Warrant Shares respecting restrictions upon transfer thereof necessary or advisable in the opinion of counsel and satisfactory to the Company to prevent further transfers which would be in violation of Section 5 of the Securities Act of 1933 (the “Securities Act”) and applicable state securities laws; and provided further that the prospective transferee or purchaser shall execute such documents and make such representations, warranties, and agreements as may be required solely to. comply with the exemptions relied upon by the Company for the transfer of disposition of the Warrant or Warrant Shares.
 
(b) If, in the opinion of counsel referred to in this Section 7, the proposed transfer or disposition of this Warrant or such Warrant Shares described in the written notice given pursuant to this Section 7 may not be effected without registration or qualification of this Warrant or such Warrant Shares the Company shall promptly give written notice thereof to the Holder, and the Holder will limit its activities in respect to such transfer or disposition as, in the opinion of both such counsel, are permitted by law.
 
8. No Fractional Shares. No fractional shares will be issued upon the exercise hereof.
 
9. Net Issue Exercise. In lieu of exercising this Warrant pursuant to Section 1 hereof, the Holder may elect to receive, without the payment of any additional consideration, a number of Warrant Shares equal to the value (as determined below) of this Warrant (or the portion thereof being exercised) by surrender of this Warrant to the Company together with a duly executed Notice of Exercise (in the form attached hereto) in which the appropriate alternative is initialed by the Holder. In such event, the Company shall issue to the Holder the number of Warrant Shares computed by applying the following formula:
 
X = Y (A-B)
A
 
3

Where:
 
 
X
 
=
  the number of Warrant Shares to be issued to the Holder;
           
 
Y
 
=
 
the number of Warrant Shares subject to this warrant (or, if only a  portion of this Warrant is being exercised, the number of Warrant Shares subject to the portion of this Warrant being exercised);
           
 
A
 
=
  the Fair Market Value of one Warrant Share (at the date of such exercise); and
           
 
B
 
=
  the Purchase Price, as adjusted to the date of such calculation.
 
For purposes of the above, the “Fair Market Value” of one share shall equal the average of the closing sale prices of the common stock quoted on the Nasdaq Stock Market or listed in the Over-The-Counter Bulletin Board (or the Pink Sheets) or the closing price quoted on any national securities exchange on which such securities are listed, whichever is applicable, for the ten consecutive trading days immediately prior to the date of determination of Fair Market Value (or, if no sales take place on any such trading day, the average of the closing bid and asked prices on such trading day). If, however, the common stock is not traded on the Nasdaq Stock Market or Over-The-Counter or on a national securities exchange, the Fair Market Value of a Warrant Share shall be determined in good faith by the Company’s board of directors.
 
10. Registration Rights.
 
(a) Subject to paragraph (d) of this Section, each time the Company shall determine to proceed with the actual preparation and filing of a registration statement under the Securities Act, in connection with the proposed offer and sale for money of any of its securities by it (other than a registration on Form S-8, S-4 or any successor forms), the Company will give written notice of its determination to Holder. Upon the written request of Holder given within 30 days after receipt of any such notice from the Company, the Company will, except as herein provided, cause all Warrant Shares with respect to which Holder has requested registration to be included in such registration statement, all to the extent requisite to permit the sale or other disposition by Holder of the shares to be so registered; provided, however, that nothing herein shall prevent the Company from, at any time, abandoning or delaying any such registration initiated by it. If any such registration pertains to an underwritten offering in whole or in part, the Company may require that the shares requested for inclusion by Holder pursuant to this section be included in the underwritten offering on the same terms and conditions as the securities otherwise being sold through the underwriters. In the event that if in the good faith judgment of the managing underwriter of such underwritten offering the inclusion of all of the Warrant Shares originally covered by a request for registration made by Holder would reduce the amount of securities to be offered by the Company or interfere with the successful marketing of the securities to be offered by the Company, the number of Warrant Shares owned by or issuable to Holder and otherwise to be included in the underwritten offering may be reduced. Any Warrant Shares which are thus excluded from the underwritten offering shall be withheld from the market by Holder for a period, not to exceed 180 days, that the managing underwriter reasonably determines is necessary in order to effect the underwritten offering.
 
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(b) If and whenever the Company is required by the provisions of Section 10(a) to effect the registration of any Warrant Shares under the Securities Act, the Company will:
 
(i) prepare and file with the SEC a registration statement with respect to such shares, and use reasonable commercial efforts to cause such registration statement to become and remain effective for such period as may be reasonably necessary to effect the sale of such shares, not to exceed two years from the date of issuance of the covered Warrant Shares;

(ii) prepare and file with the SEC such amendments to such registration statement and supplements to the prospectus contained therein as may be necessary to keep such registration statement effective for such period as may be reasonably necessary to effect the sale of such securities, not to exceed two years from the date of issuance of the covered Warrant Shares;

(iii) furnish to Holder and to the underwriters of the securities being registered such reasonable number of copies of the registration statement, preliminary prospectus, final prospectus and such other documents as Holder and underwriters may reasonably request in order to facilitate the public offering of such securities;

(iv) use reasonable commercial efforts to register or qualify the securities covered by such registration statement under such state securities or blue sky laws of such jurisdictions as the underwriters may reasonably request within 20 days following the original filing of such registration statement, except that the Company shall not for any purpose be required to execute a general consent to service of process or to qualify to do business as a foreign corporation in any jurisdiction wherein it is not so qualified; and

(v) prepare and promptly file with the SEC any amendment or supplement to such registration statement or prospectus as may be necessary to correct any statements or omissions if, at the time when a prospectus relating to such securities is required to be delivered under the Securities Act, any event shall have occurred as the result of which any such prospectus or any other prospectus as then in effect would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading.

(c) With respect to any registration of shares pursuant to Section 10(a), the Company shall bear the following fees, costs and expenses: all registration, filing and NASD fees, printing expenses, fees and disbursements of counsel and accountants for the Company, fees and disbursements of counsel for the underwriter or underwriters of such securities (if the Company and/or selling security holders are required to bear such fees and disbursements), all internal Company expenses, the premiums and other costs of policies of insurance against liability arising out of the public offering, and all legal fees and disbursements and other expenses of complying with state securities or blue sky laws of any jurisdictions in which the securities to be offered are to be registered or qualified. Fees and disbursements of counsel and accountants for Holder, underwriting discounts and commissions and transfer taxes for Holder and any other expenses incurred by Holder not expressly included above shall be borne by Holder.
 
(d) Notwithstanding anything to the contrary herein, the Company shall not be obligated to register the resale of (i) any Warrant Shares purchased for cash which have been outstanding for more than two years or (ii) any Warrant Shares, purchased pursuant to Section 9, after July 8, 2009.
 
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer.
 
     
  URON INC.:
 
 
 
 
 
 
By:   /s/ Donald Miller
 
DONALD MILLER
 
Chief Executive Officer
 
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NOTICE OF EXERCISE

(To be signed upon exercise of Warrant)
 
THE UNDERSIGNED, the holder of the within Warrant, hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, of the shares of common stock of URON Inc. to which such Warrant relates and herewith makes payment of $______________________ therefor in cash or by certified check (unless the Warrant is being exercised pursuant to Section 9, in which case the box below indicating such fact is checked), and requests that the certificate for such shares be issued in the name of, and be delivered to, ______________________ the address for which is set forth below the signature of the undersigned.
 
o
The undersigned is exercising the Warrant pursuant to the Net Issue Exercise provisions of Section 9.
 
Dated: _______________________, 20____
       
   
   
Signature
     
   
   
Name
     
   
   
Address
     
   
   
City, State, Zip Code
     
   
   
Social Security or Tax Identification No.
 
7

 
ASSIGNMENT FORM
 
(To be signed only upon authorized transfer of Warrant)
 
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers unto _______________________________ the right to purchase the securities of URON Inc., a Minnesota corporation, to which the within Warrant relates and appoints ______________________, attorney, to transfer said right on the books of URON Inc. with full power of substitution in the premises.
 
Dated: _______________________, 20____
     
   
   
Signature
     
   
   
Name
     
   
   
Address
     
   
   
Social Security or Tax Identification No.
 
8

EX-10.3 11 v108896_ex10-3.htm
URON INC.
 
2008 STOCK INCENTIVE PLAN
 
 
 

 
 

       
Page
1.
 
Purpose
 
1
2.
 
Administration
 
1
3.
 
Eligible Participants
 
1
4.
 
Types of Incentives
 
2
5.
 
Shares Subject to the Plan.
 
2
6.
 
Stock Options
 
2
7.
 
Stock Appreciation Rights
 
4
8.
 
Stock Awards and Restricted Stock
 
5
9.
 
General.
 
6
 
 
i

 
 
URON INC.
 
2008 STOCK INCENTIVE PLAN
 
1.  Purpose. The purpose of the 2008 Stock Incentive Plan (the “Plan”) of URON Inc. (the “Company”) is to increase shareholder value and to advance the interests of the Company by furnishing a variety of economic incentives (“Incentives”) designed to attract, retain and motivate employees, certain key consultants and directors of the Company. Incentives may consist of opportunities to purchase or receive shares of common stock, no par value, of the Company (“Common Stock”) or other incentive awards on terms determined under this Plan.
 
2.  Administration. 
 
2.1.  Administration by Committee. The Plan shall be administered by the board of directors of the Company (the “Board of Directors”) or by a stock option or compensation committee (the “Committee”) of the Board of Directors. The Committee shall consist of not less than two directors of the Company and shall be appointed from time to time by the Board of Directors. Each member of the Committee shall be (i) a “non-employee director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934 (including the regulations promulgated thereunder, the “1934 Act”) (a “Non-Employee Director”), and (ii) shall be an “outside director” within the meaning of Section 162(m) under the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations promulgated thereunder. The Committee shall have complete authority to award Incentives under the Plan, to interpret the Plan, and to make any other determination which it believes necessary and advisable for the proper administration of the Plan. The Committee’s decisions and matters relating to the Plan shall be final and conclusive on the Company and its participants. If at any time there is no stock option or compensation committee, the term “Committee,” as used in the Plan, shall refer to the Board of Directors.
 
2.2.  Delegation of Authority. The Company’s Chief Executive Officer may, on a discretionary basis and without Committee review or approval, grant options to purchase up to 250,000 shares each to new employees of the Company who are not officers of the Company. Such discretionary option grants shall not exceed 250,000 shares in total in any fiscal year. Subject to the foregoing limitations, the Chief Executive Officer shall determine from time to time (i) the new employees to whom grants will be made, (ii) the number of shares to be granted, and (iii) the terms and provisions of each option (which need not be identical).
 
3.  Eligible Participants. Officers of the Company, employees of the Company or its subsidiaries, members of the Board of Directors, and consultants or other independent contractors who provide services to the Company or its subsidiaries shall be eligible to receive Incentives under the Plan when designated by the Committee. Participants may be designated individually or by groups or categories (for example, by pay grade) as the Committee deems appropriate. Participation by officers of the Company or its subsidiaries and any performance objectives relating to such officers must be approved by the Committee. Participation by others and any performance objectives relating to others may be approved by groups or categories (for example, by pay grade) and authority to designate participants who are not officers and to set or modify such targets may be delegated.
 
 
 

 
 
4.  Types of Incentives. Incentives under the Plan may be granted in any one or a combination of the following forms: (a) incentive stock options and non-statutory stock options (Section 6); (b) stock appreciation rights (“SARs”) (Section 7); (c) stock awards (Section 8); and (d) restricted stock (Section 8). Subject to the specific limitations provided in this Plan, payment of Incentives may be in the form of cash, Common Stock or combinations thereof as the Committee shall determine, and with such other restrictions as it may impose.
 
5.  Shares Subject to the Plan.
 
5.1.  Number of Shares. Subject to adjustment as provided in Section 9.6, the number of shares of Common Stock which may be issued under the Plan shall not exceed 2,000,000 shares of Common Stock. Shares of Common Stock that are issued under the Plan or are subject to outstanding Incentives will be applied to reduce the maximum number of shares of Common Stock remaining available for issuance under the Plan. Any shares of Common Stock subject to SARs granted under this Plan shall be counted in full against the foregoing share limit, regardless of the number of shares of Common Stock actually issued upon the exercise of such SARs.
 
5.2.  Cancellation. In the event that a stock option or SAR granted hereunder expires or is terminated or canceled unexercised as to any shares of Common Stock, such shares may again be issued under the Plan either pursuant to stock options, SARs or otherwise. In the event that shares of Common Stock are issued as restricted stock or pursuant to a stock award and thereafter are forfeited or reacquired by the Company pursuant to rights reserved upon issuance thereof, such forfeited and reacquired shares may again be issued under the Plan, either as restricted stock, pursuant to stock awards or otherwise. The Committee may also determine to cancel, and agree to the cancellation of, Incentives in order to make a participant eligible for the grant of an Incentive at a lower exercise price than the Incentive to be canceled.
 
5.3.  Type of Common Stock. Common Stock issued under the Plan in connection with Incentives shall be authorized and unissued shares.
 
5.4.  Limitation on Certain Grants. No person shall receive grants of stock options and SARs under the Plan that exceed, in the aggregate, 250,000 shares during any one fiscal year of the Company.
 
6.  Stock Options. A stock option is a right to purchase shares of Common Stock from the Company. Each stock option granted by the Committee under this Plan shall be subject to the following terms and conditions:
 
6.1.  Price. The option price per share shall be determined by the Committee, subject to adjustment under Section 9.6. Notwithstanding the foregoing sentence, except as permitted under Section 9.16, the option price per share shall not be less than the Fair Market Value (as defined in Section 9.14) of the Common Stock on the Grant Date (as defined in Section 9.15) unless the stock option satisfies the provisions of Code Section 409A, including the rules and regulations thereunder (together, “Code Section 409A”).
 
 
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6.2.  Number. The number of shares of Common Stock subject to a stock option shall be determined by the Committee, subject to adjustment as provided in Section 9.6. The number of shares of Common Stock subject to a stock option shall be reduced in the same proportion that the holder thereof exercises an SAR if any SAR is granted in conjunction with or related to the stock option. Notwithstanding the foregoing, the limitation on grants under Section 5.4 shall apply to grants of stock options under the Plan. 
 
6.3.  Duration and Time for Exercise. Subject to earlier termination as provided in Section 9.3, the term of each stock option shall be determined by the Committee but shall not exceed ten years and one day from the Grant Date. Each stock option shall become exercisable at such time or times during its term as shall be determined by the Committee at the time of grant. The Committee may accelerate the exercisability of any stock option. Subject to the foregoing and with the approval of the Committee, all or any part of the shares of Common Stock with respect to which the right to purchase has accrued may be purchased by the Company at the time of such accrual or at any time or times thereafter during the term of the option.
 
6.4.  Manner of Exercise. A stock option may be exercised, in whole or in part, by giving written notice to the Company, specifying the number of shares of Common Stock to be purchased and accompanied by the full purchase price for such shares. The option price shall be payable (a) in United States dollars upon exercise of the option and may be paid by cash, uncertified or certified check or bank draft; (b) unless otherwise provided in the option agreement, by delivery of shares of Common Stock in payment of all or any part of the option price, which shares shall be valued for this purpose at the Fair Market Value on the date such option is exercised; or (c) unless otherwise provided in the option agreement, by instructing the Company to withhold from the shares of Common Stock issuable upon exercise of the stock option shares of Common Stock in payment of all or any part of the exercise price and/or any related withholding tax obligations consistent with Section 9.8, which shares shall be valued for this purpose at the Fair Market Value or in such other manner as may be authorized from time to time by the Committee. Prior to the issuance of shares of Common Stock upon the exercise of a stock option, a participant shall have no rights as a shareholder.
 
6.5.  Incentive Stock Options. Notwithstanding anything in the Plan to the contrary, the following additional provisions shall apply to the grant of stock options which are intended to qualify as Incentive Stock Options (as such term is defined in Code Section 422):
 
(a)  The aggregate Fair Market Value (determined as of the time the option is granted) of the shares of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by any participant during any calendar year (under all of the Company’s plans) shall not exceed $100,000. The determination will be made by taking Incentive Stock Options into account in the order in which they were granted. If such excess only applies to a portion of an Incentive Stock Option, the Committee, in its discretion, will designate which shares will be treated as shares to be acquired upon exercise of an Incentive Stock Option.
 
 
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(b)  Any option agreement for an Incentive Stock Option under the Plan shall contain such other provisions as the Committee shall deem advisable, but shall in all events be consistent with and contain all provisions required in order to qualify the options as Incentive Stock Options.
 
(c)  All Incentive Stock Options must be granted within ten years from the earlier of the date on which this Plan was adopted by Board of Directors or the date this Plan was approved by the shareholders.
 
(d)  Unless sooner exercised, all Incentive Stock Options shall expire no later than ten years after the Grant Date.
 
(e)  The option price for Incentive Stock Options shall be not less than the Fair Market Value of the Common Stock subject to the option on the Grant Date.
 
(f)  If Incentive Stock Options are granted to any participant who, at the time such option is granted, would own (within the meaning of Code Section 422) stock possessing more than 10% of the total combined voting power of all classes of stock of the employer corporation or of its parent or subsidiary corporation, (i) the option price for such Incentive Stock Options shall be not less than 110% of the Fair Market Value of the Common Stock subject to the option on the Grant Date and (ii) such Incentive Stock Options shall expire no later than five years after the Grant Date.
 
7.  Stock Appreciation Rights. An SAR is a right to receive, without payment to the Company, a number of shares of Common Stock, the amount of which is determined pursuant to the formula set forth in Section 7.5. An SAR may be granted (a) with respect to any stock option granted under this Plan, either concurrently with the grant of such stock option or at such later time as determined by the Committee (as to all or any portion of the shares of Common Stock subject to the stock option), or (b) alone, without reference to any related stock option. Each SAR granted by the Committee under this Plan shall be subject to the following terms and conditions:
 
7.1.  Price. The exercise price per share of any SAR granted without reference to a stock option shall be determined by the Committee, subject to adjustment under Section 9.6. Notwithstanding the foregoing sentence, except as permitted under Section 9.16, the exercise price per share shall not be less than the Fair Market Value of the Common Stock on the Grant Date unless the SAR satisfies the provisions of Code Section 409A.
 
7.2.  Number. Each SAR granted to any participant shall relate to such number of shares of Common Stock as shall be determined by the Committee, subject to adjustment as provided in Section 9.6. In the case of an SAR granted with respect to a stock option, the number of shares of Common Stock to which the SAR relates shall be reduced in the same proportion that the holder of the option exercises the related stock option. Notwithstanding the foregoing, the limitation on grants under Section 5.4 shall apply to grants of SARs under the Plan. 
 
7.3.  Duration. Subject to earlier termination as provided in Section 9.3, the term of each SAR shall be determined by the Committee, but shall not exceed ten years and one day from the Grant Date. Unless otherwise provided by the Committee, each SAR shall become exercisable at such time or times, to such extent and upon such conditions as the stock option, if any, to which it relates is exercisable. The Committee may in its discretion accelerate the exercisability of any SAR.
 
 
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7.4.  Exercise. An SAR may be exercised, in whole or in part, by giving written notice to the Company, specifying the number of SARs which the holder wishes to exercise. Upon receipt of such written notice, the Company shall, within 90 days thereafter, deliver to the exercising holder certificates for the shares of Common Stock or cash or both, as determined by the Committee, to which the holder is entitled pursuant to Section 7.5.
 
7.5.  Issuance of Shares Upon Exercise. The number of shares of Common Stock which shall be issuable upon the exercise of an SAR shall be determined by dividing:
 
(a)  the number of shares of Common Stock as to which the SAR is exercised multiplied by the amount of the appreciation in such shares (for this purpose, the “appreciation” shall be the amount by which the Fair Market Value of the shares of Common Stock subject to the SAR on the exercise date exceeds (1) in the case of an SAR related to a stock option, the purchase price of the shares of Common Stock under the stock option or (2) in the case of an SAR granted alone, without reference to a related stock option, an amount which shall be determined by the Committee at the time of grant, subject to adjustment under Section 9.6); by
 
(b)  the Fair Market Value of a share of Common Stock on the exercise date.
 
No fractional shares of Common Stock shall be issued upon the exercise of an SAR; instead, the holder of the SAR shall be entitled to receive a cash adjustment equal to the same fraction of the Fair Market Value of a share of Common Stock on the exercise date or to purchase the portion necessary to make a whole share at its Fair Market Value on the date of exercise.

8.  Stock Awards and Restricted Stock. A stock award consists of the transfer by the Company to a participant of shares of Common Stock, without other payment therefor, as additional compensation for services to the Company. A share of restricted stock consists of shares of Common Stock which are sold or transferred by the Company to a participant at a price, if any, determined by the Committee and subject to restrictions on their sale or other transfer by the participant. The transfer of Common Stock pursuant to stock awards and the transfer and sale of restricted stock shall be subject to the following terms and conditions:
 
8.1.  Number of Shares. The number of shares to be transferred or sold by the Company to a participant pursuant to a stock award or as restricted stock shall be determined by the Committee.
 
8.2.  Sale Price. The Committee shall determine the price, if any, at which shares of restricted stock shall be sold to a participant, which may vary from time to time and among participants and which may be below the Fair Market Value of such shares of Common Stock at the date of sale.
 
 
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8.3.  Restrictions. All shares of restricted stock transferred or sold by the Company hereunder shall be subject to such restrictions as the Committee may determine, including, without limitation any or all of the following:
 
(a)  a prohibition against the sale, transfer, pledge or other encumbrance of the shares of restricted stock, such prohibition to lapse at such time or times as the Committee shall determine (whether in annual or more frequent installments, at the time of the death, disability or retirement of the holder of such shares, or otherwise);
 
(b)  a requirement that the holder of shares of restricted stock forfeit, or (in the case of shares sold to a participant) resell back to the Company at his or her cost, all or a part of such shares in the event of termination of his or her employment or consulting engagement during any period in which such shares are subject to restrictions;
 
(c)  such other conditions or restrictions as the Committee may deem advisable.
 
8.4.  Restrictions. In order to enforce the restrictions imposed by the Committee pursuant to Section 8.3, the participant receiving restricted stock shall enter into an agreement with the Company setting forth the conditions of the grant. Shares of restricted stock shall be registered in the name of the participant and deposited, together with a stock power endorsed in blank, with the Company. Each such certificate shall bear a legend that refers to the Plan and the restrictions imposed under the applicable agreement. The Committee may provide that no certificates representing restricted stock be issued until the restriction period is completed.
 
8.5.  End of Restrictions. Subject to Section 9.5, at the end of any time period during which the shares of restricted stock are subject to forfeiture and restrictions on transfer, such shares will be delivered free of all restrictions to the participant or to the participant’s legal representative, beneficiary or heir.
 
8.6.  Rights of Holders of Restricted Stock. Subject to the terms and conditions of the Plan, each participant receiving restricted stock shall have all the rights of a shareholder with respect to shares of stock during any period in which such shares are subject to forfeiture and restrictions on transfer, including without limitation, the right to vote such shares.
 
9.  General.
 
9.1.  Effective Date. The Plan will become effective upon the date of approval by the Company’s Board of Directors (the “Effective Date”), subject to approval by the Company’s shareholders.
 
9.2.  Duration. The Plan shall remain in effect until all Incentives granted under the Plan have either been satisfied by the issuance of shares of Common Stock or the payment of cash or been terminated under the terms of the Plan and all restrictions imposed on shares of Common Stock in connection with their issuance under the Plan have lapsed. No Incentives may be granted under the Plan after the tenth anniversary of the Effective Date of the Plan.
 
 
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9.3.  Non-transferability of Incentives. No stock option, SAR, restricted stock or stock award may be transferred, pledged or assigned by the holder thereof (except, in the event of the holder’s death, by will or the laws of descent and distribution to the limited extent provided in the Plan or the Incentive, or pursuant to a qualified domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act, or the rules thereunder), and the Company shall not be required to recognize any attempted assignment of such rights by any participant. Notwithstanding the preceding sentence, stock options may be transferred by the holder thereof to the holder’s spouse, children, grandchildren or parents (collectively, the “Family Members”), to trusts for the benefit of Family Members, to partnerships or limited liability companies in which Family Members are the only partners or shareholders, or to entities exempt from federal income taxation pursuant to Code Section 501(c)(3). During a participant’s lifetime, a stock option may be exercised only by him or her, by his or her guardian or legal representative or by the transferees permitted by this Section 9.3.
 
9.4.  Effect of Termination or Death. In the event that a participant ceases to be an employee of or consultant to the Company for any reason, including death or disability, any Incentives may be exercised or shall expire at such times as may be set forth in the agreement, if any, applicable to the Incentive, or otherwise as determined by the Committee.
 
9.5.  Restrictions under Securities Laws. Notwithstanding anything in this Plan to the contrary: (a) the Company may, if it shall determine it necessary or desirable for any reason, at the time of award of any Incentive or the issuance of any shares of Common Stock pursuant to any Incentive, require the recipient of the Incentive, as a condition to the receipt thereof or to the receipt of shares of Common Stock issued pursuant thereto, to deliver to the Company a written representation of present intention to acquire the Incentive or the shares of Common Stock issued pursuant thereto for his or her own account for investment and not for distribution; and (b) if at any time the Company further determines, in its sole discretion, that the listing, registration or qualification (or any updating of any such document) of any Incentive or the shares of Common Stock issuable pursuant thereto is necessary on any securities exchange or under any federal or state securities or blue sky law, or that the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with the award of any Incentive, the issuance of shares of Common Stock pursuant thereto, or the removal of any restrictions imposed on such shares, such Incentive shall not be awarded or such shares of Common Stock shall not be issued or such restrictions shall not be removed, as the case may be, in whole or in part, unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company.
 
9.6.  Adjustment. In the event of any recapitalization, stock dividend, stock split, combination of shares or other change in the Common Stock, the number of shares of Common Stock then subject to the Plan, including shares subject to outstanding Incentives, and the other numbers of shares of Common Stock provided in the Plan, shall be adjusted in proportion to the change in outstanding shares of Common Stock. In the event of any such adjustments, the purchase price of any option, the performance objectives of any Incentive, and the shares of Common Stock issuable pursuant to any Incentive shall be adjusted as and to the extent appropriate, in the discretion of the Committee, to provide participants with the same relative rights before and after such adjustment.
 
 
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9.7.  Incentive Plans and Agreements. Except in the case of stock awards, the terms of each Incentive shall be stated in a plan or agreement approved by the Committee. The Committee may also determine to enter into agreements with holders of options to reclassify or convert certain outstanding options, within the terms of the Plan, as Incentive Stock Options or as non-statutory stock options and in order to eliminate SARs with respect to all or part of such options and any other previously issued options. The Committee shall communicate the key terms of each award to the participant promptly after the Committee approves the grant of such award.
 
9.8.  Withholding.
 
(a)  The Company shall have the right to withhold from any payments made under the Plan or to collect as a condition of payment, any taxes required by law to be withheld. At any time when a participant is required to pay to the Company an amount required to be withheld under applicable income tax laws in connection with a distribution of Common Stock or upon exercise of an option or SAR or upon vesting of restricted stock, the participant may satisfy this obligation in whole or in part by electing (the “Election”) to have the Company withhold, from the distribution or from such shares of restricted stock, shares of Common Stock having a value up to the minimum amount of withholding taxes required to be collected on the transaction. The value of the shares to be withheld shall be based on the Fair Market Value of the Common Stock on the date that the amount of tax to be withheld shall be determined (“Tax Date”).
 
(b)  Each Election must be made prior to the Tax Date. The Committee may disapprove of any Election, may suspend or terminate the right to make Elections, or may provide with respect to any Incentive that the right to make Elections shall not apply to such Incentive. An Election is irrevocable.
 
9.9.  No Continued Employment, Engagement or Right to Corporate Assets. No participant under the Plan shall have any right, because of his or her participation, to continue in the employ of the Company for any period of time or to any right to continue his or her present or any other rate of compensation. Nothing contained in the Plan shall be construed as giving an employee, a consultant, such persons’ beneficiaries or any other person any equity or interests of any kind in the assets of the Company or creating a trust of any kind or a fiduciary relationship of any kind between the Company and any such person.
 
9.10.  Payments Under Incentives. Payment of cash or distribution of any shares of Common Stock to which a participant is entitled under any Incentive shall be made as provided in the Incentive. Except as permitted under Section 9.16, payments and distributions may not be deferred under any Incentive unless the deferral complies with the requirements of Code Section 409A.
 
 
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9.11.  Amendment of the Plan. The Board of Directors may amend or discontinue the Plan at any time. However, no such amendment or discontinuance shall adversely change or impair, without the consent of the recipient, an Incentive previously granted. Further, no such amendment shall, without approval of the shareholders of the Company, (a) increase the maximum number of shares of Common Stock which may be issued to all participants under the Plan, (b) change or expand the types of Incentives that may be granted under the Plan, (c) change the class of persons eligible to receive Incentives under the Plan, or (d) materially increase the benefits accruing to participants under the Plan.
 
9.12.  Amendment of Agreements for Incentives. Except as otherwise provided in this Section 9.12, the terms of an existing Incentive may be amended by agreement between the Committee and the participant. Notwithstanding the foregoing sentence, in the case of a stock option or SAR, except as permitted under Section 9.16, no such amendment shall (a) extend the term of the Incentive, or (b) reduce the exercise price per share below the Fair Market Value of the Common Stock on the date the Incentive was granted, unless, in either case, the amendment complies with the requirements of Code Section 409A.
 
9.13.  Sale, Merger, Exchange or Liquidation. Unless otherwise provided in the agreement for an Incentive, in the event of an acquisition of the Company through the sale of substantially all of the Company’s assets or through a merger, exchange, reorganization or liquidation of the Company or a similar event as determined by the Committee (collectively a “transaction”), the Committee shall be authorized, in its sole discretion, to take any and all action it deems equitable under the circumstances, including but not limited to any one or more of the following:
 
(a)  providing that the Plan and all Incentives shall terminate and the holders of (i) all outstanding vested options shall receive, in lieu of any shares of Common Stock they would be entitled to receive under such options, such stock, securities or assets, including cash, as would have been paid to such participants if their options had been exercised and such participant had received Common Stock immediately prior to such transaction (with appropriate adjustment for the exercise price, if any), (ii) SARs that entitle the participant to receive Common Stock shall receive, in lieu of any shares of Common Stock each participant was entitled to receive as of the date of the transaction pursuant to the terms of such Incentive, if any, such stock, securities or assets, including cash, as would have been paid to such participant if such Common Stock had been issued to and held by the participant immediately prior to such transaction, and (iii) any Incentive under this Agreement which does not entitle the participant to receive Common Stock shall be equitably treated as determined by the Committee.
 
(b)  providing that participants holding outstanding vested Common Stock based Incentives shall receive, with respect to each share of Common Stock issuable pursuant to such Incentives as of the effective date of any such transaction, at the determination of the Committee, cash, securities or other property, or any combination thereof, in an amount equal to the excess, if any, of the Fair Market Value of such Common Stock on a date within ten days prior to the effective date of such transaction over the option price or other amount owed by a participant, if any, and that such Incentives shall be cancelled, including the cancellation without consideration of all options that have an exercise price below the per share value of the consideration received by the Company in the transaction.
 
 
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(c)  providing that the Plan (or replacement plan) shall continue with respect to Incentives not cancelled or terminated as of the effective date of such transaction and provide to participants holding such Incentives the right to earn their respective Incentives on a substantially equivalent basis (taking into account the transaction and the number of shares or other equity issued by such successor entity) with respect to the equity of the entity succeeding the Company by reason of such transaction.
 
(d)  providing that all unvested, unearned or restricted Incentives, including but not limited to restricted stock for which restrictions have not lapsed as of the effective date of such transaction, shall be void and deemed terminated, or, in the alternative, for the acceleration or waiver of any vesting, earning or restrictions on any Incentive.
 
The Board of Directors may restrict the rights of participants or the applicability of this Section 9.13 to the extent necessary to comply with Section 16(b) of the 1934 Act, the Code or any other applicable law or regulation. The grant of an Incentive award pursuant to the Plan shall not limit in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure or to merge, exchange or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets.

9.14.  Definition of Fair Market Value. For purposes of this Plan, the “Fair Market Value” of a share of Common Stock at a specified date shall, unless otherwise expressly provided in this Plan, be the amount which the Committee determines in good faith to be 100% of the fair market value of such a share as of the date in question. Notwithstanding the foregoing: 
 
(a)  If such shares are listed on a U.S. securities exchange, then Fair Market Value shall be determined by reference to the last sale price of a share of Common Stock on such U.S. securities exchange on the applicable date. If such U.S. securities exchange is closed for trading on such date, or if the Common Stock does not trade on such date, then the last sale price used shall be the one on the date the Common Stock last traded on such U.S. securities exchange.
 
(b)  If such shares are publicly traded but are not listed on a U.S. securities exchange, then Fair Market Value shall be determined by reference to the trading price of a share of Common Stock on such date (or, if the applicable market is closed on such date, the last date on which the Common Stock was publicly traded), by a method consistently applied by the Committee.
 
(c)  If such shares are not publicly traded, then the Committee’s determination will be based upon a good faith valuation of the Company’s Common Stock as of such date, which shall be based upon such factors as the Committee deems appropriate. The valuation shall be accomplished in a manner that complies with Code Section 409A and shall be consistently applied to Incentives under the Plan.
 
 
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9.15.  Definition of Grant Date. For purposes of this Plan, the “Grant Date” of an Incentive shall be the date on which the Committee approved the award or, if later, the date on which (1) the participant is no longer able to negotiate the terms of the award and (2) it is expected that the key terms of the award will be communicated within a relatively short period of time.
 
9.16.  Compliance with Code Section 409A. The Plan and the agreement for each Incentive shall be interpreted and administered so as to be exempt from the requirements of Code Section 409A or to comply with such requirements. Notwithstanding the foregoing, Incentives may be awarded or amended in a manner which does not comply with Code Section 409A, but only if and to the extent that the Committee specifically provides in written resolutions that the Incentive or amendment is not intended to comply with Code Section 409A. 
 
Approved by the Board of Directors on February 2, 2008
 
 
11

 
EX-10.4 12 v108896_ex10-4.htm
URON INC.
SUBSCRIPTION AGREEMENT
 

THIS SUBSCRIPTION AGREEMENT (the “Agreement”) is made on _________________, 2007, by and between URON Inc., a Minnesota corporation (the “Company”), and __________________________ and __________________________ (if joint investor) (referred to throughout the remainder of this Agreement, whether singly or jointly, as the “undersigned”) in connection with the private placement offering (the “Offering”) of up to 2,953,125 shares of the Company’s common stock (the “Shares”) at $1.20 per share (without effect given to any subsequent stock combination effected by the Company, in connection with any transaction involving Wyoming Financial Lenders, Inc., a Wyoming corporation, as described in Section 7 below). The undersigned understands and acknowledges that the Company has the right to reject any subscription, in whole or in part, for any reason, and that the Company will promptly return the funds delivered herewith, without interest or deduction, if this subscription is rejected or if the Offering is otherwise terminated. There is no minimum amount of proceeds that must be received by the Company prior to the Company accessing subscribers’ funds. Nevertheless, proceeds related to subscriptions shall be placed in escrow with the Company’s legal counsel pending one or more closings.
 
1.  Subscription for Shares. Subject to the terms hereinafter set forth, the undersigned hereby irrevocably subscribes for and agrees to purchase from the Company ______________ Shares for a total of $ ____________________  (the “Purchase Price”). Payment of the Purchase Price is being delivered by an enclosed check payable to the order of “URON Inc.” or wire transfer of immediately available funds to the Company’s legal counsel (pursuant to wiring instructions that the undersigned may request).
 
2.  Issuance of Shares and Certificates. Upon acceptance of this subscription and the closing of the Offering (or any part of the Offering to which this subscription relates), the Company will, subject to the provisions of Section 7 below, record the undersigned as an owner of the Shares subscribed, and cause a certificate representing the Shares to be delivered to the undersigned within 20 days of the termination date of the Offering. Pending the Company’s closing on funds related to this subscription, proceeds will be placed in escrow with the Company’s legal counsel under the terms set forth in Section 8 below. All Shares will be duly authorized, validly issued, fully paid and non-assessable shares of the Company’s common stock. The undersigned hereby authorizes the Company to issue a certificate representing the Shares in the name and to the address set forth below:
 
______________________________________________________________________________
Print name(s) of investor

______________________________________________________________________________
SSN(s) or federal TIN

______________________________________________________________________________
Mailing address

______________________________________________________________________________
City     State   Zip code

______________________________________________________________________________
Telephone no.     Fax no.

______________________________________________________________________________
E-mail address
 

 
3.  Investor Representations and Warranties. By executing and delivering this Agreement, the undersigned acknowledges, warrants and represents to the Company as follows:
 
(a)  The undersigned has obtained and read (i) this Subscription Agreement, and (ii) any other documents specifically requested by the undersigned; and undersigned has also reviewed, or waived its opportunity to review, (iii) the Company’s most recent annual report on Form 10-KSB filed with the SEC on April 17, 2007; most recent quarterly report on Form 10-QSB filed with the SEC on November 20, 2007; and all current reports on Form 8-K filed thereafter (all of the foregoing documents referred to in this paragraph are hereinafter collectively referred to as the “Disclosure Documents”).
 
(b)  The undersigned understands that an aggregate of 1,071,875 shares of common stock will be sold to a single cash investor, who is also the Company’s current chief executive officer, for an effective purchase price of $0.466 per share. The undersigned also understands that funds relating to this subscription will be placed in escrow with the Company’s legal counsel pending closing pursuant to the terms set forth in Section 8 below.
 
(c)  The undersigned has, either alone or with the assistance of a professional advisor, sufficient knowledge and experience in financial and business matters that the undersigned believes himself, herself or itself capable of evaluating the merits and risks of the prospective investment in the Shares and the suitability of an investment in the Company in light of the undersigned’s financial condition and investment needs, and legal, tax and accounting matters.
 
(d)  The undersigned has been given access to full and complete information regarding the Company and has utilized such access to the undersigned’s satisfaction for the purpose of obtaining information in addition to, or verifying information included in, the Disclosure Documents. Particularly, the undersigned has been given reasonable opportunity to meet with or contact Company representatives for the purpose of asking questions of, and receiving answers from, such representatives concerning the terms and conditions of the Offering and to obtain any additional information, to the extent reasonably available, necessary to verify the accuracy of information provided in the Disclosure Documents.
 
(e)  The undersigned is an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities Act of 1933 (the “Securities Act”). This representation is based on the following factual representations hereby made to the Company (please check all that apply): 
 
 
· 
The undersigned has had an individual income in excess of $200,000 in each of the two most recent years or joint income with the undersigned’s spouse in excess of $300,000 in each of the two most recent fiscal years, and reasonably expect reaching the same income level in the current year;
 
 
·
As of the date hereof, the undersigned (either individually or with the undersigned’s spouse) has a net worth exceeding $1,000,000;
 
 
·
The undersigned is a corporation, partnership or Massachusetts or similar business trust not formed for the specific purpose of acquiring the Shares and has total assets exceeding $5,000,000;
 
 
·
The undersigned (or, in the case of a trust, the undersigned trustee) is a bank or savings and loan association as defined in Sections 3(a)(2) and 3(a)(5)(A), respectively, of the Securities Act acting either in the undersigned’s individual or fiduciary capacity;
 
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·
The undersigned is an insurance company as defined in Section 2(13) of the Securities Act, an investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that act or a Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958.
 
 
·
The undersigned is an employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”) and either (check one or more, as applicable):
 
 
·
The investment decision is made by a plan fiduciary, as defined in Section 3(21) of ERISA, which is either a bank, savings and loan association, insurance company, or registered investment adviser;
 
 
·
The employee benefit plan has total assets in excess of $5,000,000; or
 
 
·
The plan is a self directed plan with investment decisions made solely by persons who are “accredited investors” as defined under the Securities Act.
 
 
·
The undersigned is a private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.
 
 
·
The undersigned, if not an individual, is an entity all of whose equity owners meet one of the tests set forth in the paragraphs above (if relying on this category alone, the Company may in its discretion require each equity owner of the undersigned entity to complete a separate copy of this Agreement).
 
(f)  The undersigned acknowledges that an investment in the Shares involves a high degree of risk, including but not limited to the risk of losing his, her or its entire investment in the Company.
 
(g)  The undersigned acknowledges that no federal or state agency, including the SEC or the securities commission or authority of any state, has approved or disapproved the Shares, passed upon or endorsed the merits of the Offering of the Shares or the accuracy or adequacy of the Disclosure Documents, or made any finding or determination as to the fairness or fitness of the Shares for public sale.
 
(h)  The undersigned has relied upon the advice of the undersigned’s legal counsel and accountants or other financial advisors with respect to legal, tax and other considerations relating to the purchase of Shares in the Offering. The undersigned is not relying upon the Company with respect to the economic considerations involved in making an investment decision with respect to the Shares.
 
(i)  The undersigned is a bona fide resident of (or, if an entity, is organized or incorporated under the laws of, and is domiciled in), and received the offer and decided to invest in the Shares in, the state or jurisdiction set forth as the undersigned’s mailing address in Section 1 above.
 
4.  Investment Purpose. The undersigned represents and warrants that it is the undersigned’s intention to acquire the Shares for the account of the undersigned, for investment purposes and not with a view to the resale of the Shares in connection with any distribution thereof. To assure the Company that the undersigned has no present intention to resell or dispose of the Shares acquired in the Offering, the undersigned further represents and warrants to the Company as follows:
 
(a)  The undersigned intends to receive and hold the Shares for the undersigned’s personal account, and has no contract, undertaking, agreement or arrangement with any person or entity to sell or otherwise transfer the Shares to any such person or entity or to have any such person or entity sell the Shares on the undersigned’s behalf.
 
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(b)  The undersigned has no need for immediate liquidity with respect to his, her or its investment and has sufficient income to meet the undersigned’s current and anticipated obligations. The loss of the undersigned’s entire investment in the Shares would not cause financial hardship to the undersigned and would not adversely affect the undersigned’s current standard of living. In addition, the overall commitment of the undersigned to investments that are not readily marketable is not disproportionate to the undersigned’s net worth and the undersigned’s investment in the Shares will not cause such overall commitment to become excessive.
 
(c)  The undersigned is not aware of any occurrence, event or circumstance upon the happening of which the undersigned intends to transfer or sell the Shares and the undersigned does not have any present intention to transfer or sell the Shares after a lapse of any particular period of time.
 
(d)  The undersigned has been informed that, in the view of the SEC and certain state securities commissions, a purchase of the Shares with a current intent to resell, by reason of any foreseeable specific contingency or anticipated change in market values, any change in the condition of the Company or the investment market as a whole, or in connection with a contemplated liquidation or settlement of any loan obtained for the acquisition of the Shares, would represent a purchase with an intent inconsistent with the representations set forth above, and that the SEC and certain state securities commissions might regard such sale or disposition as a deferred sale with regard to which an exemption from registration is not available.
 
(e)  If other than an individual, the undersigned represents and warrants that (i) it was not organized for the specific purpose of acquiring the Shares, and (ii) this Agreement has been duly authorized by all necessary action on the part of the undersigned, has been duly executed by an authorized officer or representative of the undersigned, and is a legal, valid and binding obligation of the undersigned enforceable in accordance with its terms.
 
5.  Registration Status; Restrictions on Transferability. With respect to the registration status and transferability of the Shares (in addition to Section 4 above), the undersigned understands, acknowledges and agrees that:
 
(a)  Neither the offer nor the sale of the Shares to be issued in connection with this subscription and the Offering have been, or will have been, registered under the Securities Act or under applicable state securities laws on the grounds that they are being issued in a transaction (i) involving a limited group of knowledgeable investors fully familiar with the proposed operations of the Company and (ii) not involving a public offering and that, consequently, such transaction is exempt from registration under the Securities Act and applicable state securities laws. The Company will rely on the undersigned’s representations herein as a basis for the exemption from the Securities Act’s registration requirements.
 
(b)  The Shares may not be sold, transferred or otherwise disposed of except pursuant to an effective registration statement or appropriate exemption from registration under applicable state law and, as a result, the undersigned may be required to hold the Shares for an indefinite period of time. In addition to customary legends that may be required under state law, certificates representing the Shares will bear a legend substantially in the following form:
 
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAW OF ANY STATE. SUCH SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND WITHOUT A VIEW TO THEIR DISTRIBUTION AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF IN THE ABSENCE OF ANY EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OF 1933 AND UNDER APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE UNDER APPLICABLE SECURITIES LAWS.
 
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(c)  The Company will use commercially reasonable efforts to prepare and file, within 60 days after the closing of the currently anticipated merger transaction involving the Company and Wyoming Financial Lenders, Inc., a registration statement on Form SB-2 (or other available and appropriate form) with the SEC. The registration statement will seek to register the resale of the Shares offered and sold to the undersigned pursuant to this Agreement; provided, however, that the Company may cutback the number of Shares the resale of which is proposed to be registered under the registration statement to the extent the Company reasonably deems necessary to comply with SEC Rule 415, interpretations thereof proponed by SEC staff, or for any other reason relating to the Company’s compliance with federal and state securities laws. The Company will use commercially reasonable efforts to obtain the effectiveness of the registration statement within 60 days of its filing; provided, however, that if, after the 60th day after such filing, the SEC provides to the Company further comments relating to the registration statement, the Company shall have the right to withdraw such registration statement so long as a majority of the shares of common stock sold in the Offering shall, as of the date of withdrawal, become available for resale under Rule 144 within a 90-day period thereafter. If the registration statement is declared effective by the SEC, then the Company will use commercially reasonable efforts to maintain the effectiveness of the registration statement for such period of time until at least a majority of the Shares offered and sold in the Offering may be resold under Rule 144. As a condition to the obligations of the Company to prepare and file a registration statement covering the resale of Shares purchased hereunder by the undersigned, the undersigned agrees to furnish the Company with such information as may be reasonably required in connection with the preparation and filing of the registration statement, and in connection with the Company’s responses to SEC comments. Furthermore, the undersigned agrees to comply with the provisions of the plan of distribution set forth in the final prospectus forming a part of the registration statement.
 
(d)  All fees and expenses incident to the Company’s performance of or compliance with the covenants of the Company contained in paragraph (c) above shall be borne by the Company. Such fees and expenses shall include without limitation (i) all registration and filing fees, (ii) printing expenses, (iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for the Company, and (v) fees and expenses of all other persons and firms retained by the Company in connection with its performance of the obligations set forth in paragraph (c) above. In addition, the Company shall be responsible for all of its internal expenses incurred in connection with its performance of such obligations. In no event, however, shall the Company be responsible for any broker or similar commissions incurred by the undersigned or any of the undersigned’s legal fees or other costs associated with the offer, purchase, and subsequent re-offer and resale of the Shares.
 
5

 
6.  Dispute Resolution.
 
(a)  To the greatest extent possible, the parties will endeavor to resolve any disputes relating to this Agreement and this subscription through amicable negotiations. Failing an amicable settlement, any controversy, claim or dispute arising under or relating to this Agreement, including the existence, validity, interpretation, performance, termination or breach of this Agreement, will finally be settled by binding arbitration before a single arbitrator (the “Arbitration Tribunal”) which will be jointly appointed by the parties. The Arbitration Tribunal shall self-administer the arbitration proceedings utilizing the Commercial Rules of the American Arbitration Association; provided, however, the American Arbitration Association shall not be involved in administration of the arbitration. The arbitrator must be a retired judge of a state or federal court of the United States or a licensed lawyer with at least ten years of corporate or commercial law experience and have at least an AV rating by Martindale Hubbell. If the parties cannot agree on an arbitrator, either party may request the American Arbitration Association to appoint an arbitrator which appointment will be final.
 
(b)  The arbitration will be held in Minneapolis, Minnesota. Each party will have discovery rights as provided by the Federal Rules of Civil Procedure within the limits imposed by the arbitrator; provided, however, that all such discovery will be commenced and concluded within 60 days of the selection of the arbitrator. It is the intent of the parties that any arbitration will be concluded as quickly as reasonably practicable. Once commenced, the hearing on the disputed matters will be held four days a week until concluded, with each hearing date to begin at 9:00 a.m. and to conclude at 5:00 p.m. The arbitrator will use all reasonable efforts to issue the final written report containing award or awards within a period of five business days after closure of the proceedings. Failure of the arbitrator to meet the time limits of this Article will not be a basis for challenging the award. The Arbitration Tribunal will not have the authority to award punitive damages to either party. Each party will bear its own expenses, but the parties will share equally the expenses of the Arbitration Tribunal. The Arbitration Tribunal shall award attorneys’ fees and other related costs payable by the losing party to the successful party as it deems equitable. This Agreement will be enforceable, and any arbitration award will be final and non-appealable, and judgment thereon may be entered in any court of competent jurisdiction.
 
7.  Effect of Subsequent Stock Combination. The Shares purchased hereunder shall not be affected by, and shall for all purposes be considered issued subsequent to, the effectuation of any stock combination (i.e., reverse stock split) of the Company in any way connected with a transaction involving the Company and Wyoming Financial Lenders, Inc., a Wyoming corporation. Accordingly, and to effectuate the intent of this Section, the Company may delay the book entry and issuance of the Shares (and corresponding certificates) until such time as it shall have effected such a stock combination (but in no event may such book entry and issuance be delayed more than six weeks); provided, however, that if the Company’s shareholders shall, during the period of any such delay permitted by this Section, become entitled to vote or entitled to receive any distribution upon their shares of Company capital stock, the Company shall for all such purposes treat the Shares as issued and outstanding.
 
8.  Escrow with Legal Counsel. Until no later than March 30, 2008, Maslon Edelman Borman & Brand, LLP, the Company’s legal counsel (serving as “escrow agent”), will pay out escrowed funds relating to subscriptions in this Offering when and as directed in writing by the officers of the Company. The sole duty of the escrow agent shall be to receive said funds and hold them subject to release, in accordance herewith, and the escrow agent shall be under no duty to determine whether the Company is complying with any requirements or conditions relating to its access to funds from the sale of securities hereunder. The escrow agent may conclusively rely upon and shall be protected in acting upon any statement, certificate, notice, request, consent, order or other document believed by it to be genuine and to have been signed or presented by the proper party or parties. The escrow agent shall have no duty or liability to verify any such statement, certificate, notice, request, consent, order or other document, and its sole responsibility shall be to act only as expressly set forth herein. The escrow agent shall be under no obligation to institute or defend any action, suit or proceeding in connection herewith unless first indemnified to its satisfaction. The escrow agent shall not be liable for any action taken or omitted in good faith. The escrow agent is acting solely as escrow agent hereunder and owes no duties, covenants or obligations, fiduciary or otherwise, to any other person by reason of this arrangement, except as otherwise stated herein, and no implied duties, covenants or obligations, fiduciary or otherwise, shall be read into this arrangement against the escrow agent. In the event of any disagreement between the Company and any investor in this Offering resulting in adverse claims or demands being made in connection with the matters covered by this Agreement, or in the event that the escrow agent is in doubt as to what action it should take hereunder, the escrow agent may, at its option, refuse to comply with any claims or demands on it, or refuse to take any other action hereunder, so long as such disagreement continues or such doubt exists, and in any such event, the escrow agent shall not be or become liable in any way or to any person for its failure or refusal to act, and the escrow agent shall be entitled to continue so to refrain from acting until (i) the rights of all interested parties shall have been fully and finally adjudicated by a court of competent jurisdiction, or (ii) all differences shall have been adjudged and all doubt resolved by agreement among all of the interested persons, and the escrow agent shall have been notified thereof in writing signed by all such persons. Notwithstanding the foregoing, the escrow agent may in its discretion obey the order, judgment, decree or levy of any court, whether with or without jurisdiction and the escrow agent is hereby authorized in its sole discretion to comply with and obey any such orders, judgments, decrees or levies. In the event that any controversy should arise with respect to this Agreement the escrow agent shall have the right, at its option, to institute an interpleader action in any court of competent jurisdiction to determine the rights of the parties. In no event shall the escrow agent be liable, directly or indirectly, for any special, indirect or consequential losses or damages of any kind whatsoever (including without limitation lost profits), even if the escrow agent has been advised of the possibility of such losses or damages and regardless of the form of action. Escrow agent may resign upon ten days advance written notice to the Company. If a successor escrow agent is not appointed within the ten-day period following such notice, escrow agent may petition any court of competent jurisdiction to name a successor escrow agent or interplead the funds from subscribers then in its possession with such court, whereupon escrow agent’s duties hereunder shall terminate. The escrow agent shall be a third-party beneficiary to the provisions of this Section 8.
 
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9.  Indemnification. The Company hereby indemnifies, defends and holds harmless the escrow agent from and against any and all loss, liability, cost, damage and expense, including, without limitation, reasonable counsel fees which the escrow agent may suffer or incur by reason of any action, claim or proceeding brought against the escrow agent, arising out of or relating in any way to this Agreement or any transaction to which this Agreement relates, unless such action, claim or proceeding is the result of the willful misconduct of the escrow agent. The provisions of this section shall survive the termination of this Agreement and any resignation or removal of the escrow agent.
 
10.  General Provisions. From and after the date of the Company’s acceptance of this subscription, as set forth on the signature page hereto, this Agreement shall remain in effect until such time as (a) the undersigned has performed the full subscription by delivering full payment of the aggregate Purchase Price for the Shares referenced above and set forth on the signature page hereto, and (b) the Company has fulfilled its obligation to the undersigned by recording the undersigned as the owner of the appropriate number of Shares in its required records and delivering a certificate representing the Shares pursuant to Section 1. The covenants made in Section 6 shall be construed as an agreement independent of any other provision of this Agreement, and shall survive the termination of this Agreement, together with the provisions of this Section relating to severability, waiver, binding effect and governing law. Furthermore, the representations and warranties of the undersigned shall survive the termination of this Agreement. If any provision of this Agreement or the application of such provision to any party or circumstances shall be held invalid, the remainder of the Agreement, or the application of such provision to such party or circumstances other than those to which it is held invalid, shall not be affected thereby. This Agreement may be modified or amended only by a written instrument signed by both the Company and the undersigned. No failure or delay by either the Company or the undersigned in exercising or enforcing any right or remedy under this Agreement will waive any provision of the Agreement. Nor will any single or partial exercise by either the Company or the undersigned of any right or remedy under this Agreement preclude either of them from otherwise or further exercising these rights or remedies, or any other rights or remedies granted by any law or any related document. Upon acceptance by the Company, this Agreement shall be binding upon and shall inure to the benefit of the Company and the undersigned and to the successors and assigns of the Company and to the personal and legal representatives, heirs, guardians, successors and permitted assignees of the undersigned. This Agreement shall be governed by and construed in accordance with the laws of the State of Minnesota without regard to the conflicts-of-law principles thereof. The venue for any action hereunder shall be in the State of Minnesota, whether or not such venue is or subsequently becomes inconvenient, and the parties consent to the jurisdiction of the courts of the State of Minnesota, County of Hennepin, and the U.S. District Court, District of Minnesota. This Agreement constitutes the entire agreement among the parties with respect to the Company. It supersedes any prior agreement or understanding among them, and it may not be modified or amended in any manner other than as set forth herein. Upon request, the undersigned agrees to furnish to the Company such additional information as may be deemed necessary to determine the undersigned’s suitability as an investor. This Agreement may be executed in counterparts, which taken together shall constitute one agreement binding on the parties hereto. Facsimile and electronically transmitted signatures shall be valid and binding to the same extent as original signatures. In making proof of this Agreement, it will be necessary to produce only one copy signed by the party to be charged.
 
*  *  *  *  *
 
7

 
SUBSCRIPTION AGREEMENT - SIGNATURE PAGE
 
In WITNESS WHEREOF, the undersigned has executed this Subscription Agreement as of _____________________, 2007.
 

Individuals:
 
Entities:
 
 
Signature of investor
 
 
Name of entity
 
 
Signature of joint investor
 
 
Authorized signature
   
 
 
Print name
   
Its:
 

 
Form of ownership for individual investors (check one):
 
________________ Individual ownership _______________Tenants in common
 
________________ Joint tenants (JTWROS)________________  Individual ownership pursuant to a purchase under
      the Uniform Gift to Minors Act

Other: ________________________________________________________________________             
 
________________________________________________________________________
 
________________________________________________________________________
 
ACKNOWLEDGED AND ACCEPTED:
 
URON INC.:
 
_______________________________________ ___________________________
By: __________________________________________
Dated
Title: _________________________________________
 

EX-21 13 v108896_ex21.htm Unassociated Document
LIST OF SUBSIDIARIES

Wyoming Financial Lenders, Inc. (a Wyoming corporation)

 
 

EX-31.1 14 v108896_ex31-1.htm Unassociated Document
EXHIBIT 31.1
 
CERTIFICATION
 
I, Christopher Larson, certify that:
 
1. I have reviewed this Annual Report on Form 10-K of URON Inc. (the “Registrant”);
 
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
 
4. The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
 
 
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
 
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
 
(c)
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
 
(d)
Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
 
5. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
 
 
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
 
 
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.
 
     
Date: April 7, 2008    /s/ Christopher Larson
 

Christopher Larson
President & Chief Executive Officer


 
EX-31.2 15 v108896_ex31-2.htm Unassociated Document
EXHIBIT 31.2
 
CERTIFICATION
 
I, Steve Staehr, certify that:
 
1. I have reviewed this Annual Report on Form 10-K of URON Inc. (the “Registrant”);
 
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
 
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
 
4. The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
 
 
(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
 
 
(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
 
 
(c)
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
 
 
(d)
Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
 
5. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
 
 
(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
 
 
(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.
 
     
Date: April 7, 2008   /s/ Steve Staehr
 
Steve Staehr
Chief Financial Officer


 
EX-32.1 16 v108896_ex32-1.htm Unassociated Document
EXHIBIT 32.1

CERTIFICATE PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
 
The undersigned, Christopher Larson, President and Chief Executive Officer of URON Inc. (the “Company”), hereby certifies, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
 
(1)
The Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2007, as filed with the Securities and Exchange Commission on the date hereof (the “Annual Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
(2)
The information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

       
/s/ Christopher Larson    

Christopher Larson
President and Chief Executive Officer
April 7, 2008
   
 

EX-32.2 17 v108896_ex32-2.htm Unassociated Document
EXHIBIT 32.2

CERTIFICATE PURSUANT TO
18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
 
The undersigned, Steve Staehr, President and Chief Executive Officer of URON Inc. (the “Company”), hereby certifies, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
 
(1)
The Company’s Annual Report on Form 10-K for the fiscal year ending December 31, 2007, as filed with the Securities and Exchange Commission on the date hereof (the “Annual Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
 
(2)
The information contained in the Annual Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
       
/s/ Steve Staehr    

Steve Staehr
Chief Financial Officer
April 7, 2008
   
 

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