SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X ] Preliminary Proxy Statement [_] Confidential, For Use
of the Commission Only
(As Permitted by Rule 14a-6(e)(2))
[] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
TETON PETROLEUM COMPANY
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
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[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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TETON PETROLEUM COMPANY
P.O. Box 774327
Steamboat Springs, Colorado 80477
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MARCH 19, 2003
Steamboat Springs, Colorado
January __, 2003
An Annual Meeting of Stockholders (the "Annual Meeting") of Teton
Petroleum Company, a Delaware corporation (the "Company"), will be held at o on
March 19, 2003 at 10:00 AM (local time) for the following purposes:
1. To elect four directors to the Corporation's Board of
Directors, to hold office until his successor is elected and
qualified or until his earlier resignation or removal
(Proposal No. 1);
2. To amend the Company's certificate of incorporation to
increase the authorized amount of capital stock from
100,000,000 shares to 275,000,000 shares of which 25,000,000
shares will be blank check preferred stock (Proposal No. 2).
3. To adopt the 2003 Stock Option Plan (Proposal No. 3);
4. To effect a one-for-ten reverse stock split (the "Reverse
Stock Split") of the Company's common stock (Proposal No. 4);
5. To consider and act upon a proposal to ratify the Board of
Directors' selection of Ehrhadt Keefe Steiner & Hottman PC as
the Corporation's independent auditors for the fiscal year
ending December 31, 2002 (Proposal No. 5);
6. To transact such other business as may properly come before
the Annual Meeting and any adjournment or postponement
thereof.
BECAUSE OF THE SIGNIFICANCE OF THIS PROPOSAL TO THE COMPANY AND ITS
SHAREHOLDERS, IT IS VITAL THAT EVERY SHAREHOLDER VOTES AT THE ANNUAL MEETING IN
PERSON OR BY PROXY.
The foregoing items of business are more fully described in the Proxy
Statement that is attached and made a part of this Notice.
The Board of Directors has fixed the close of business on o(Record
Date), 2003 as the record date for determining the stockholders entitled to
notice of and to vote at the Annual Meeting and any adjournment or postponement
thereof.
All stockholders are cordially invited to attend the Annual Meeting in
person. Your vote is important regardless of the number of shares you own.
Whether or not you plan to attend the meeting, please take the time to vote in
one of these ways:
o By mail - fill in, sign and date the enclosed proxy card and
return it promptly in the postage-paid envelope.
o By telephone - call the toll-free telephone number on your
proxy card to vote by phone.
o Via Internet - visit the web site noted on your proxy card to
vote via the Internet.
You may attend the meeting and vote in person even if you have
previously voted by proxy in one of three ways listed above. Your proxy is
revocable in accordance with the procedures set forth in the Proxy Statement.
By Order of the Board of Directors,
H. Howard Cooper
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IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND RETURN THE
ENCLOSED PROXY CARD AS PROMPTLY AS POSSIBLE IN THE ENCLOSED POSTAGE-PREPAID
ENVELOPE. IF A QUORUM IS NOT REACHED, THE COMPANY WILL HAVE THE ADDED EXPENSE OF
RE-ISSUING THESE PROXY MATERIALS. IF YOU ATTEND THE MEETING AND SO DESIRE, YOU
MAY WITHDRAW YOUR PROXY AND VOTE IN PERSON.
THANK YOU FOR ACTING PROMPTLY
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TETON PETROLEUM COMPANY
P.O. Box 774327
Steamboat Springs, Colorado 80477
PROXY STATEMENT
GENERAL
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors (the "Board") of Teton Petroleum Company, a Delaware
corporation (the "Company"), of proxies in the enclosed form for use in voting
at the Annual Meeting of Stockholders (the "Annual Meeting") to be held at
_________ on March 19, 2003 at 10:00 AM (local time), and any adjournment or
postponement thereof. Only holders of record of the Company's common stock,
$.001 par value per share (the "Common Stock"), on ________, 2003 (the "Record
Date") will be entitled to vote at the Meeting. At the close of business on the
Record Date, the Company had issued and outstanding 58,550,302 shares of Common
Stock.
In accordance with the Company's bylaws, the presence of a majority of
the shares entitled to vote, whether present in person or represented by proxy,
will constitute a quorum at the meeting. Abstentions will be treated as shares
that are present and entitled to vote but against any proposal submitted to
stockholders. Executed proxies returned by a broker holding shares of the
Company's Common Stock in street name which indicate that the broker does not
have discretionary authority as to certain shares to vote on one or more matters
("broker non-votes") will be considered present but not entitled to vote on any
proposal submitted to stockholders
Any person giving a proxy in the form accompanying this Proxy Statement
has the power to revoke it prior to its exercise. Any proxy given is revocable
prior to the Meeting by an instrument revoking it or by a duly executed proxy
bearing a later date delivered to the Secretary of the Company. Such proxy is
also revoked if the stockholder is present at the Meeting and elects to vote in
person.
The Company will bear the entire cost of preparing, assembling,
printing and mailing the proxy materials furnished by the Board of Directors to
stockholders. Copies of the proxy materials will be furnished to brokerage
houses, fiduciaries and custodians to be forwarded to the beneficial owners of
the Common Stock. In addition to the solicitation of proxies by use of the mail,
some of the officers, directors and regular employees of the Company may
(without additional compensation) solicit proxies by telephone or personal
interview, the costs of which the Company will bear.
This Proxy Statement and the accompanying form of proxy is being sent
or given to stockholders on or about o, 2003.
Stockholders of the Company's Common Stock are entitled to one vote for
each share held. Such shares may not be voted cumulatively.
Each validly returned proxy (including proxies for which no specific
instruction is given) which is not revoked will be voted "FOR" each of the
proposals as described in this Proxy Statement and, at the proxy holders'
discretion, on such other matters, if any, which may come before the Meeting
(including any proposal to adjourn the Meeting).
Determination of whether a matter specified in the Notice of Annual
Meeting of Stockholders has been approved will be determined as follows. The
affirmative vote of the holders of a plurality of the shares of the Company cast
at the Annual Meeting is required for the election of directors (Proposal No.
1). The affirmative vote of the holders of a majority of the outstanding shares
of the Company present or represented by proxy and entitled to vote on the
matter is required to:
o adopt the 2003 Stock Option Plan (Proposal No. 3);
o effect a one-for-ten reverse stock split (the "Reverse Stock
Split") of the Company's common stock (Proposal No. 4);
o consider and act upon a proposal to ratify the Board of
Directors' selection of Ehrhardt Keefe Steiner & Hoffman PC as
the Corporation's independent auditors for the fiscal year
ending December 31, 2002 (Proposal No. 5);
The affirmative vote of the holders of a majority of the outstanding shares of
the Company is required to amend the Company's certificate of incorporation to
increase the authorized amount of capital stock from 100,000,000 shares to
275,000,000 shares, of which 250,000,000 shall be common stock and 25,000,000
shall be preferred stock (Proposal No. 2).
1
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The board of directors (the "Board") proposes the election of the
current directors of the Company for an additional term of one year. Following
is information about each nominee, including biographical data for at least the
last five years. Should one or more of these nominees become unavailable to
accept nomination or election as a director, the individuals named as proxies on
the enclosed proxy card will vote the shares that they represent for the
election of such other persons as the Board may recommend, unless the Board
reduces the number of directors.
The Board has long adhered to governance principles designed to assure
the continued vitality of the Board and excellence in the execution of its
duties. Accordingly, directors are compensated for their service to the Company
pursuant to the terms of their employment agreements. The Board is responsible
for supervision of the overall affairs of the Company. In fiscal 2001, the
Board's business was conducted by consents in lieu of meetings. The directors
executed o consents in lieu of meeting. Following the Annual Meeting, the Board
will consist of four directors. The term of each director continues until the
next annual meeting or until successors are elected. The nominees for director
are:
o H. Howard Cooper, President and Director
o Thomas F. Conroy, Chief Financial Officer, Secretary and
Director
o Karl F. Arleth, Director
o James J. Woodcock, Director
H. HOWARD COOPER, has been our president and chairman of the board of
directors since 1996. Mr. Cooper founded American Tyumen in November 1996. He
served as a director and president of American Tyumen until the merger with EQ.
Since the merger, he has held these same positions with Teton. In 1994, he was a
consultant to Central Asian Petroleum, an oil and gas company located in Russia
and Peak Energy, an oil and gas company located in Denver, Colorado. Mr. Cooper
has a bachelor's degree from the University of Colorado in business and a
master's degree from Columbia University in international affairs.
THOMAS F. CONROY, has been our chief financial officer since March
2002, secretary since April 2002, and director since 2002. Mr. Conroy is a
Certified Public Accountant with an MBA from the University of Chicago. Mr.
Conroy, spent 27 years with ING and its predecessor organizations, serving in
various financial positions and leading two of its strategic business units as
President. As President of ING Reinsurance, he established their international
presence, setting up facilities in The Netherlands, Bermuda, Ireland and Japan.
He also served as an Officer and Board Member of Security Life of Denver
Insurance Company and its subsidiaries.
KARL F. ARLETH, has been a director since 2002. Mr. Arleth is the Chief
Operating Officer and a Board member of Sefton Resources, Inc. Mr. Arleth spent
21 years with Amoco and BP-Amoco. In 1998 he chaired the Board of the Azerbaijan
International Operating Company (AIOC) for BP-Amoco in Baku, Azerbaijan.
Concurrently in 1997-98, he was also President of Amoco Caspian Sea Petroleum
Ltd. in Azerbaijan and Director of Strategic Planning for Amoco Corporations
Worldwide Exploration and Production Sector in Chicago. From 1992 -- 1996 Mr.
Arleth was President of Amoco Poland Ltd. in Warsaw, Poland.
JAMES J. WOODCOCK has been a director since 2002. Mr. Woodcock is
presently the founder and CEO of Hy-Bon Engineering Company, based in Midland,
Texas. Hy-Bon is an engineering firm and manufacturer of vapor recovery, gas
boosters, and casing pressure reduction systems for the oil industry. Mr.
Woodcock is a current board member of Renovar Energy, a private firm located in
Midland Texas and was previously chairman of Transrepublic Resources, also a
private firm located in Midland Texas.
Approval of this proposal requires the affirmative vote of a plurality
of the shares of the Company cast at the Annual Meeting.
RECOMMENDATION OF THE BOARD:
THE BOARD RECOMMENDS A VOTE FOR THE ELECTION OF ALL THE ABOVE NOMINEES.
2
PROPOSAL NO. 2
AMENDMENT TO THE ARTICLES OF INCORPORATION
The Board of the Company proposes amending the Company's certificate of
incorporation to increase the number of authorized shares of common stock from
100,000,000 to 250,000,000 and to authorize the creation of 25,000,000 shares of
blank check preferred stock. The Company currently has authorized capital stock
of 100,000,000 of shares of common stock and approximately 58,550,302 shares of
common stock are outstanding as of the Record Date. The Board believes that the
increase in authorized shares would provide the Company greater flexibility with
respect to the Company's capital structure for such purposes as additional
equity financing, and stock based acquisitions.
INCREASE IN AUTHORIZED COMMON STOCK
-----------------------------------
The terms of the additional shares of common stock will be identical to
those of the currently outstanding shares of common stock. However, because
holders of common stock have no preemptive rights to purchase or subscribe for
any unissued stock of the Company, the issuance of additional shares of common
stock will reduce the current stockholders' percentage ownership interest in the
total outstanding shares of common stock. This amendment will not alter the
current number of issued shares. The relative rights and limitations of the
shares of common stock would remain unchanged under this proposal.
As of November 15, 2002, a total of 58,550,302 shares of the Company's
currently authorized shares of common stock are issued and outstanding. The
increase in the number of authorized but unissued shares of common stock would
enable the Company, without further stockholder approval, to issue shares from
time to time as may be required for proper business purposes, such as raising
additional capital for ongoing operations, business and asset acquisitions,
stock splits and dividends, present and future employee benefit programs and
other corporate purposes.
One of the effects of proposed amendment might be to enable the Board
to render it more difficult to, or discourage an attempt to, obtain control of
the Company by means of a merger, tender offer, proxy contest or otherwise, and
thereby protect the continuity of present management. The Board would, unless
prohibited by applicable law, have additional shares of common stock available
to effect transactions (such as private placements) in which the number of the
Company's outstanding shares would be increased and would thereby dilute the
interest of any party attempting to gain control of the Company. Such action
could discourage an acquisition of the Company, which stockholders might view as
desirable.
CREATION OF BLANK CHECK PREFERRED STOCK
---------------------------------------
The amendment to the certificate of incorporation will create
25,000,000 authorized shares of "blank check" preferred stock. Article IV of the
proposed amendment to the certificate of incorporation attached as Exhibit "A"
to this proxy statement contains provisions related to the "blank check"
preferred stock. The following summary does not purport to be complete and is
qualified in its entirety by reference to the proposed amendment to the
certificate of incorporation as set forth in Exhibit "A."
The term "blank check" refers to preferred stock, the creation and
issuance of which is authorized in advance by the stockholders and the terms,
rights and features of which are determined by the Board of the Company upon
issuance. The authorization of such blank check preferred stock would permit the
board of directors to authorize and issue preferred stock from time to time in
one or more series.
Subject to the provisions of the Company's amendment to the certificate
of incorporation and the limitations prescribed by law, the Board would be
expressly authorized, at its discretion, to adopt resolutions to issue shares,
to fix the number of shares and to change the number of shares constituting any
series and to provide for or change the voting powers, designations, preferences
and relative, participating, optional or other annual rights, qualifications,
limitations or restrictions thereof, including dividend rights (including
whether the dividends are cumulative), dividend rates, terms of redemption
(including sinking fund provisions), redemption prices, conversion rights and
liquidation preferences of the shares constituting any series of the preferred
stock, in each case without any further action or vote by the stockholders. The
Board would be required to make any determination to issue shares of preferred
stock based on its judgment as to the best interests of the Company and its
stockholders. The Board is seeking stockholder approval of an amendment to the
certificate of incorporation which would give the Board flexibility, without
further stockholder action, to issue preferred stock on such terms and
conditions as the board of directors deems to be in the best interests of the
Company and its stockholders. The Company has no immediate definitive plans to
issue any shares of preferred stock. Therefore, the terms, rights and features
of a preferred stock subject to this proposal cannot be stated or predicted with
certainty.
3
It is not possible to state the effects of the proposed amendment upon
the rights of holders of common stock until the Board determines the respective
rights of the holders of one or more series of preferred stock. However, the
issuance of shares of preferred stock pursuant to the Board's authority
described above may adversely affect the rights of the holders of common stock.
Specifically, the effects of such issuances of preferred stock could include (i)
reduction of the amount of cash otherwise available for payment of dividends on
common stock, if any, (ii) restrictions on dividends on common stock, (iii)
dilution of the voting power of common stock, and (iv) restrictions on the
rights of holders of common stock to share in the Company's assets on
liquidation until satisfaction of any liquidation preference granted to the
holders of such subsequently designated series of preferred stock. For example,
preferred stock issued by the Company may rank prior to the common stock as to
dividend rights, liquidation preferences or both, may have full or limited
voting rights, and may be convertible into shares of common stock. Accordingly,
the issuance of shares of preferred stock could decrease the amount of earnings
and assets allocable to or available for distribution to holders of common stock
and adversely affect the rights and powers, including voting rights of the
common stock, and may discourage bids for the common Stock or may otherwise
adversely affect the market price of the common Stock.
The amendment will provide the Company with increased financial
flexibility in meeting future capital requirements by providing another type of
security in addition to its common stock, as it will allow preferred stock to be
available for issuance from time to time and with such features as determined by
the Board for any proper corporate purpose. Such purposes could include, without
limitation, issuance for cash as a means of obtaining capital for use by the
Company, or issuance as part or all of the consideration required to be paid by
the Company for acquisitions of other businesses or assets.
Any issuance of preferred stock with voting rights could, under certain
circumstances, have the effect of delaying or preventing a change in control of
the Company by increasing the number of outstanding shares entitled to vote and
by increasing the number of votes required to approve a change in control of the
Company. Shares of voting or convertible preferred stock could be issued, or
rights to purchase such shares could be issued, to render more difficult or
discourage an attempt to obtain control of the Company by means of a tender
offer, proxy contest, merger or otherwise. The ability of the board of directors
to issue such additional shares of preferred stock, with the rights and
preferences it deems advisable, could discourage an attempt by a party to
acquire control of the Company by tender offer or other means. Such issuances
could therefore deprive stockholders of benefits that could result from such an
attempt, such as the realization of a premium over the market price that such an
attempt could cause. Moreover, the issuance of such additional shares of
preferred stock to persons friendly to the Board could make it more difficult to
remove incumbent managers and directors from office even if such change were to
be favorable to stockholders generally.
While the amendment may have anti-takeover ramifications, the Board
believes that the financial flexibility offered by the amendment outweighs any
disadvantages. To the extent that the amendment may have anti-takeover effects,
the amendment may encourage persons seeking to acquire the Company to negotiate
directly with the Board enabling the Board to consider the proposed transaction
in a manner that best serves the stockholders' interests.
Unless marked otherwise, proxies received will be voted "FOR" the
approval of this Proposal No. 2. amending the certificate of incorporation of
the Company requires the affirmative vote of the holders of a majority of the
outstanding shares of common stock of the Company.
RECOMMENDATION OF THE BOARD FOR PROPOSAL NO. 2:
THE BOARD RECOMMENDS A VOTE FOR APPROVAL OF THE AMENDMENT OF THE CERTIFICATE OF
INCORPORATION.
4
PROPOSAL NO. 3
APPROVAL OF THE 2003 EMPLOYEE STOCK OPTION PLAN
At the Annual Meeting, the Company's stockholders are being asked to
approve the 2003 Employee Stock Option Plan (the "2003 Option Plan") and to
authorize 25,000,000 shares of Common Stock for issuance thereunder. The
following is a summary of principal features of the 2003 Option Plan. The
summary, however, does not purport to be a complete description of all the
provisions of the 2003 Option Plan. Any stockholder of the Company who wishes to
obtain a copy of the actual plan document may do so upon written request to the
Company's Secretary, Thomas F. Conroy, at the Company's principal offices at
P.O. Box 774327, Steamboat Springs, Colorado 80477.
GENERAL
The 2003 Option Plan was adopted by the Board of Directors in o. The
Board of Directors has initially reserved 25,000,000 shares of Common Stock for
issuance under the 2003 Option Plan. Under the Plan, options may be granted
which are intended to qualify as Incentive Stock Options ("ISOs") under Section
422 of the Internal Revenue Code of 1986 (the "Code") or which are not
("Non-ISOs") intended to qualify as Incentive Stock Options thereunder.
The 2003 Option Plan and the right of participants to make purchases
thereunder are intended to qualify as an "employee stock purchase plan" under
Section 423 of the Internal Revenue Code of 1986, as amended (the "Code"). The
2003 Option Plan is not a qualified deferred compensation plan under Section
401(a) of the Internal Revenue Code and is not subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA").
PURPOSE
The primary purpose of the 2003 Option Plan is to attract and retain
the best available personnel for the Company in order to promote the success of
the Company's business and to facilitate the ownership of the Company's stock by
employees. In the event that the 2003 Option Plan is not adopted the Company may
have considerable difficulty in attracting and retaining qualified personnel,
officers, directors and consultants.
ADMINISTRATION
The 2003 Option Plan, when approved, will be administered by the
Company's Board of Directors, as the Board of Directors may be composed from
time to time. All questions of interpretation of the 2003 Option Plan are
determined by the Board, and its decisions are final and binding upon all
participants. Any determination by a majority of the members of the Board of
Directors at any meeting, or by written consent in lieu of a meeting, shall be
deemed to have been made by the whole Board of Directors.
Notwithstanding the foregoing, the Board of Directors may at any time,
or from time to time, appoint a committee (the "Committee") of at least two
members of the Board of Directors, and delegate to the Committee the authority
of the Board of Directors to administer the Plan. Upon such appointment and
delegation, the Committee shall have all the powers, privileges and duties of
the Board of Directors, and shall be substituted for the Board of Directors, in
the administration of the Plan, subject to certain limitations.
Members of the Board of Directors who are eligible employees are
permitted to participate in the 2003 Option Plan, provided that any such
eligible member may not vote on any matter affecting the administration of the
2003 Option Plan or the grant of any option pursuant to it, or serve on a
committee appointed to administer the 2003 Option Plan. In the event that any
member of the Board of Directors is at any time not a "disinterested person", as
defined in Rule 16b-3(c)(3)(i) promulgated pursuant to the Securities Exchange
Act of 1934, the Plan shall not be administered by the Board of Directors, and
may only by administered by a Committee, all the members of which are
disinterested persons, as so defined.
ELIGIBILITY
Under the 2003 Option Plan, options may be granted to key employees,
officers, directors or consultants of the Company, as provided in the 2003
Option Plan.
5
TERMS OF OPTIONS
The term of each Option granted under the Plan shall be contained in a
stock option agreement between the Optionee and the Company and such terms shall
be determined by the Board of Directors consistent with the provisions of the
Plan, including the following:
(a) PURCHASE PRICE. The purchase price of the Common Shares subject to each
ISO shall not be less than the fair market value (as set forth in the
2003 Option Plan), or in the case of the grant of an ISO to a Principal
Stockholder, not less that 110% of fair market value of such Common
Shares at the time such Option is granted. The purchase price of the
Common Shares subject to each Non-ISO shall be determined at the time
such Option is granted, but in no case less than 85% of the fair market
value of such Common Shares at the time such Option is granted.
(b) VESTING. The dates on which each Option (or portion thereof) shall be
exercisable and the conditions precedent to such exercise, if any,
shall be fixed by the Board of Directors, in its discretion, at the
time such Option is granted.
(c) EXPIRATION. The expiration of each Option shall be fixed by the Board
of Directors, in its discretion, at the time such Option is granted;
however, unless otherwise determined by the Board of Directors at the
time such Option is granted, an Option shall be exercisable for ten
(10) years after the date on which it was granted (the "Grant Date").
Each Option shall be subject to earlier termination as expressly
provided in the 2003 Option Plan or as determined by the Board of
Directors, in its discretion, at the time such Option is granted.
(d) TRANSFERABILITY. No Option shall be transferable, except by will or the
laws of descent and distribution, and any Option may be exercised
during the lifetime of the Optionee only by him. No Option granted
under the Plan shall be subject to execution, attachment or other
process.
(e) OPTION ADJUSTMENTS. The aggregate number and class of shares as to
which Options may be granted under the Plan, the number and class
shares covered by each outstanding Option and the exercise price per
share thereof (but not the total price), and all such Options, shall
each be proportionately adjusted for any increase decrease in the
number of issued Common Shares resulting from split-up spin-off or
consolidation of shares or any like Capital adjustment or the payment
of any stock dividend.
Except as otherwise provided in the 2003 Option Plan, any Option
granted hereunder shall terminate in the event of a merger,
consolidation, acquisition of property or stock, separation,
reorganization or liquidation of the Company. However, the Optionee
shall have the right immediately prior to any such transaction to
exercise his Option in whole or in part notwithstanding any otherwise
applicable vesting requirements.
(f) TERMINATION, MODIFICATION AND AMENDMENT. The 2003 Option Plan (but not
Options previously granted under the Plan) shall terminate ten (10)
years from the earlier of the date of its adoption by the Board of
Directors or the date on which the Plan is approved by the affirmative
vote of the holders of a majority of the outstanding shares of capital
stock of the Company entitled to vote thereon, and no Option shall be
granted after termination of the Plan. Subject to certain restrictions,
the Plan may at any time be terminated and from time to time be
modified or amended by the affirmative vote of the holders of a
majority of the outstanding shares of the capital stock of the Company
present, or represented, and entitled to vote at a meeting duly held in
accordance with the applicable laws of the State of Delaware.
FEDERAL INCOME TAX ASPECTS OF THE 2003 OPTION PLAN
THE FOLLOWING IS A BRIEF SUMMARY OF THE EFFECT OF FEDERAL INCOME
TAXATION UPON THE PARTICIPANTS AND THE COMPANY WITH RESPECT TO THE PURCHASE OF
SHARES UNDER THE 2003 OPTON PLAN. THIS SUMMARY DOES NOT PURPORT TO BE COMPLETE
AND DOES NOT ADDRESS THE FEDERAL INCOME TAX CONSEQUENCES TO TAXPAYERS WITH
SPECIAL TAX STATUS. IN ADDITION, THIS SUMMARY DOES NOT DISCUSS THE PROVISIONS OF
THE INCOME TAX LAWS OF ANY MUNICIPALITY, STATE OR FOREIGN COUNTRY IN WHICH THE
PARTICIPANT MAY RESIDE, AND DOES NOT DISCUSS ESTATE, GIFT OR OTHER TAX
CONSEQUENCES OTHER THAN INCOME TAX CONSEQUENCES. THE COMPANY ADVISES EACH
PARTICIPANT TO CONSULT HIS OR HER OWN TAX ADVISOR REGARDING THE TAX CONSEQUENCES
OF PARTICIPATION IN THE 2003 OPTION PLAN AND FOR REFERENCE TO APPLICABLE
PROVISIONS OF THE CODE.
The 2003 Option Plan and the right of participants to make purchases
thereunder are intended to qualify under the provisions of Sections 421, 422 and
423 of the Code. Under these provisions, no income will be recognized by a
participant prior to disposition of shares acquired under the 2003 Option Plan.
6
If the shares are sold or otherwise disposed of (including by way of
gift) more than two years after the first day of the offering period during
which shares were purchased (the "Offering Date"), a participant will recognize
as ordinary income at the time of such disposition the lesser of (a) the excess
of the fair market value of the shares at the time of such disposition over the
purchase price of the shares or (b) 15% of the fair market value of the shares
on the first day of the offering period. Any further gain or loss upon such
disposition will be treated as long-term capital gain or loss. If the shares are
sold for a sale price less than the purchase price, there is no ordinary income
and the participant has a capital loss for the difference.
If the shares are sold or otherwise disposed of (including by way of
gift) before the expiration of the two-year holding period described above, the
excess of the fair market value of the shares on the purchase date over the
purchase price will be treated as ordinary income to the participant. This
excess will constitute ordinary income in the year of sale or other disposition
even if no gain is realized on the sale or a gift of the shares is made. The
balance of any gain or loss will be treated as capital gain or loss and will be
treated as long-term capital gain or loss if the shares have been held more than
one year.
In the case of a participant who is subject to Section 16(b) of the
Exchange Act, the purchase date for purposes of calculating such participant's
compensation income and beginning of the capital gain holding period may be
deferred for up to six months under certain circumstances. Such individuals
should consult with their personal tax advisors prior to buying or selling
shares under the 2003 Option Plan.
The ordinary income reported under the rules described above, added to
the actual purchase price of the shares, determines the tax basis of the shares
for the purpose of determining capital gain or loss on a sale or exchange of the
shares.
The Company is entitled to a deduction for amounts taxed as ordinary
income to a participant only to the extent that ordinary income must be reported
upon disposition of shares by the participant before the expiration of the
two-year holding period described above.
RESTRICTIONS ON RESALE
Certain officers and directors of the Company may be deemed to be
"affiliates" of the Company as that term is defined under the Securities Act.
The Common Stock acquired under the 2003 Option Plan by an affiliate may be
reoffered or resold only pursuant to an effective registration statement or
pursuant to Rule 144 under the Securities Act or another exemption from the
registration requirements of the Securities Act.
REQUIRED VOTE
The approval of the 2003 Option Plan and the reservation of 25,000,000
shares for issuance requires the affirmative vote of the holders of a majority
of the shares of the Company's Common Stock present at the Annual Meeting in
person or by proxy and entitled to vote and constituting at least a majority of
the required quorum.
The proxy holders intend to vote the shares represented by proxies to
approve, the 2003 Stock Option Plan.
RECOMMENDATION OF THE BOARD:
----------------------------
THE BOARD RECOMMENDS A VOTE FOR APPROVAL OF THE 2003 STOCK OPTION PLAN.
7
PROPOSAL NO. 4
ONE FOR TEN REVERSE SPLIT
At the Annual Meeting, the Company's stockholders are being asked to
approve a Reverse Stock Split pursuant to which each ten currently outstanding
shares of Common Stock (the "Old Shares") would be automatically converted into
one share of Common Stock (the "New Shares"). The reason for the Reverse Stock
Split is to increase the per share stock price. The Company believes that if it
is successful in maintaining a higher stock price, the stock will generate
greater interest among professional investors and institutions. If the Company
is successful in generating interest among such entities, it is anticipated that
the shares of its Common Stock would have greater liquidity and a stronger
investor base. No assurance can be given, however, that the market price of the
New Shares will rise in proportion to the reduction in the number of outstanding
shares resulting from the Reverse Stock Split. The New Shares issued pursuant to
the Reverse Stock Split will be fully paid and non-assessable. All New Shares
will have the same par value, voting rights and other rights as Old Shares.
Stockholders of the Company do not have preemptive rights to acquire additional
shares of Common Stock, which may be issued.
The one for ten reverse Stock Split is being effectuated by reducing
the number of issued and outstanding shares at the ratio of 10 to 1.
Accordingly, as a result of the Reverse Stock Split, the Company will have
approximately o authorized unissued shares, which shares may be issued in
connection with acquisitions or subsequent financings. There can be no assurance
that the Company will be successful in making any such acquisitions or obtaining
any such financings. In addition, the Reverse Stock Split has potentially
dilutive effects on each of the shareholders. Each of the shareholders may be
diluted to the extent that any of the authorized but unissued shares are
subsequently issued.
The Reverse Stock Split will not alter any shareholder's percentage
interest in the Company's equity, except to the extent that the Reverse Stock
Split results in any of the Company's shareholders owning a fractional share. In
lieu of issuing fractional shares, the Company will issue to any shareholder who
otherwise would have been entitled to receive a fractional share as a result of
the Reverse Split an additional full share of its common stock. The principal
effects of the Reverse Stock Split will be that the number of shares of Common
Stock issued and outstanding will be reduced from 58,550,302 to approximately
5,855,030.
In addition, commencing with the effective date of the Reverse Stock
Split, all outstanding options entitling the holders thereof to purchase shares
of the Company's common stock will entitle such holders to receive, upon
exercise of their options, one-tenth of the number of shares of the Company's
common stock which such holders may purchase upon exercise of their options. In
addition, commencing on the effective date of the Reverse Stock Split, the
exercise price of all outstanding options will be increased by a multiple of
ten.
The Company believes that the Federal income tax consequences of the
reverse stock split to holders of Common Stock will be as follows:
(i) Except as explained in (v) below, no income gain or
loss will be recognized by a shareholder on the
surrender of the current shares or receipt of the
certificate representing new post-split shares.
(ii) Except as explained in (v) below, the tax basis of
the New Shares will equal the tax basis of the Old
Shares exchanged therefore.
(iii) Except as explained in (v) below, the holding period
of the New Shares will include the holding period of
the Old Shares if such Old Shares were held as
capital assets.
(iv) The conversion of the Old Shares into the new shares
will produce no taxable income or gain or loss to the
Company.
(v) The Federal income tax treatment of the receipt of
the additional fractional interest by a shareholder
is not clear and may result in tax liability not
material in amount in view of the low value of such
fractional interest.
The Company's opinion is not binding upon the Internal Revenue Service
or the courts, and there can be no assurance that the Internal Revenue Service
or the courts will accept the positions expressed above.
8
THE ABOVE REFRENCED IS A BRIEF SUMMARY OF THE EFFECT OF FEDERAL INCOME TAXATION
UPON THE PARTICIPANTS AND THE COMPANY WITH RESPECT TO THE REVERSE STOCK SPLIT.
THIS SUMMARY DOES NOT PURPORT TO BE COMPLETE AND DOES NOT ADDRESS THE FEDERAL
INCOME TAX CONSEQUENCES TO TAXPAYERS WITH SPECIAL TAX STATUS. IN ADDITION, THIS
SUMMARY DOES NOT DISCUSS THE PROVISIONS OF THE INCOME TAX LAWS OF ANY
MUNICIPALITY, STATE OR FOREIGN COUNTRY IN WHICH THE PARTICIPANT MAY RESIDE, AND
DOES NOT DISCUSS ESTATE, GIFT OR OTHER TAX CONSEQUENCES OTHER THAN INCOME TAX
CONSEQUENCES. THE COMPANY ADVISES EACH PARTICIPANT TO CONSULT HIS OR HER OWN TAX
ADVISOR REGARDING THE TAX CONSEQUENCES OF THE REVERSE STOCK SPLIT AND FOR
REFERENCE TO APPLICABLE PROVISIONS OF THE CODE.
PROPOSAL NO. 5
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
Ehrhardt Keefe Steiner & Hoffman PC has served as the Company's
independent auditors since o and has been appointed by the Board to continue as
the Company's independent auditors for the fiscal year ending December 31, 2002.
In the event that ratification of this selection of auditors is not approved by
a majority of the shares of Common Stock voting at the Annual Meeting in person
or by proxy, the Board will reconsider its selection of auditors. o has no
interest, financial or otherwise, in the Company.
A representative of o is not expected to be present at the Annual
Meeting.
The proxy holders intend to vote the shares represented by proxies to
ratify the Board of Directors' selection of o as the Company's independent
auditors for the fiscal year ending December 31, 2002.
AUDIT FEES
Fees related to the services performed by Ehrhardt Keefe Steiner &
Hoffman PC for the year ended December 31, 2001 audit and September 30, 2001
quarterly review of Form 10QSB were $_______.
ALL OTHER FEES
Fees related to the services performed by Ehrhardt Keefe Steiner &
Hoffman PC other than the services described above in audit fees, principally
tax services and other SEC filing requirements and matters were $_______.
Approval of this proposal requires the affirmative vote of the majority
of the shares present in person or represented by proxy and entitled to vote at
the Annual Meeting.
RECOMMENDATION OF THE BOARD
THE BOARD RECOMMENDS A VOTE FOR RATIFICATION OF THE APPOINTMENT OF
EHRHARDT KEEFE STEINER & HOFFMAN PC AS THE COMPANY'S INDEPENDENT AUDITORS FOR
THE FISCAL YEAR ENDING DECEMBER 31, 2002.
9
EXECUTIVE COMPENSATION
The following table sets forth information concerning the compensation
received by Mr. Howard Cooper, the President of Teton, who serves as its chief
executive officer for the last three fiscal years:
SUMMARY COMPENSATION TABLE
Name and Securities
Principal Position Year Salary Underlying Options
------------------ ---- ------ ------------------
H. Howard Cooper, President 2001 $210,000(1) --
2000 $ 17,000(2)(3) --
1999 (3) 1,000,000
------------
(1) $180,907 of which was paid in 2001. The balance, $29,093, was accrued in
2001 but not paid.
(2) Such amount was accrued in 2000 and paid in January 2001. Compensation is
for one month's services.
(3) Prior to December 2000, Teton did not pay any cash compensation to any of
its officers. However, pursuant to an unwritten consulting arrangement with
Taimen Corporation, a corporation owned by Mr. Cooper, and of which Mr. Cooper
and his spouse were the sole employees, Teton paid Taimen $247,000 and $128,560,
respectively, during the fiscal years ended December 31, 2000 and 1999, for
management and related services.
STOCK OPTIONS.
During the year ended December 31, 2001, Mr. Cooper did not exercise any of his
stock options. Based on the average of the high and low bid for our common stock
on December 31, 2001, as of December 31, 2001, Mr. Cooper did not hold any
in-the-money stock options.
Employee Pension, Profit Sharing or Other Retirement Plans.
----------------------------------------------------------
The Company does not have a defined benefit, pension plan, profit sharing, or
other retirement plan.
Compensation of Directors.
--------------------------
The Company does not pay a director's fee to its directors. In the Company's
sole discretion, the Company may issue stock options or warrants to its
directors. The company expects to institute a Directors fee program to its
Directors in 2003.
Employment Contracts.
---------------------
Teton and Mr. Cooper entered into a new employment agreement, effective May 1,
2002. The employment agreement is for a three year term. Mr. Cooper's initial
salary under the agreement is $160,000 per year. In the board's discretion, he
and other Executive officers may receive additional bonus compensation as well
as stock options. Mr. Cooper's employment is terminated immediately upon his
death or permanent disability. Teton may also terminate Mr. Cooper's employment
immediately for cause, as defined in the agreement. Mr. Cooper may terminate his
employment immediately for good reason, as defined in the agreement.
Additionally, either Teton or Mr. Cooper may terminate Mr. Cooper's employment
upon 60 days prior written notice to the other. Upon termination of Mr. Cooper's
employment without cause by Teton or for good reason by Mr. Cooper, Mr. Cooper
is entitled to severance pay. The severance pay is equal to Mr. Cooper's salary
for the preceding 24 months. Such severance may be paid in monthly installments
over 24 months from the date of termination. Teton may discontinue the severance
payments if Mr. Cooper violates the confidentiality, noncompetition, or
nonsolicitation provisions of his employment agreement. After the third year,
the agreement is renewed from year to year by the Board of Directors, unless it
is terminated as provided above.
Mr. Cooper's new agreement will replace the employment agreement dated effective
December 1, 2000 (the "2000 Employment Agreement"). The 2000 Employment
Agreement provided for an initial term of two years and an initial salary of
$210,000 per year. The 2000 Employment Agreement also provided that upon the
termination of Mr. Cooper without his consent, except for terminations related
to a criminal conviction, death, disability, incapacity, bankruptcy, insolvency,
gross negligence, gross dereliction of duty, or gross misconduct, that Mr.
Cooper was entitled to a lump sum payment equal to three months salary, based on
the salary being paid to Mr. Cooper at the date of termination.
10
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following tables sets forth, as of o, the number of and percent of
our common stock beneficially owned by (a) all directors and nominees, naming
them, (b) our executive officers, (c) our directors and executive officers as a
group, without naming them, and (d) persons or groups known by us to own
beneficially 5% or more of our common stock:
Name and Address Amount and Nature of Percent
of Beneficial Owner Beneficial Ownership of Class
------------------- -------------------- --------
H. Howard Cooper 7,360,535 (1) 12.6%
2135 Burgess Creek Road
Suite #7
P.O. Box 774327
Steamboat Springs, CO 80477
Thomas F. Conroy 356,110 (2) *
3825 S. Colorado Blvd.
Denver, CO 80110
James J. Woodcock 2,578,224 (3) 4.4%
2404 Commerce Drive
Midland, TX 79702
Karl F. Arleth 1,375,939 (4) 2.4%
P.O. Box 23507
0467 Lariat Loop
Silverthorne, CO 80498
All executive officers and 11,670,808 19.9%
directors as a group (4 persons)
----------
* Less than one percent.
(1) Includes 5,586,250 warrants.
(2) Includes 353,333 warrants.
(3) Includes 1,366,667 warrants.
(4) Includes 466,667 warrants
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Transactions Involving Mr. Howard Cooper and Ms. Anna Cooper.
------------------------------------------------------------
Mr. Cooper and Teton have entered into an employment agreement. Mr. Cooper's
employment agreement with Teton is discussed at "EXECUTIVE COMPENSATION -
Employment Contracts."
Ms. Anna R. Cooper, Mr. Cooper's wife, is in the second year of a two year
employment agreement with Teton. The employment agreement provides that Ms.
Cooper's initial salary is $78,000 per year. After the initial term, the
agreement is renewed from year to year, with such changes agreed by the Board of
Directors unless terminated by either party upon 90 days prior notice. The
agreement provides that upon the termination of Ms. Cooper's employment without
her consent, except for terminations related to a criminal conviction, death,
disability, incapacity, bankruptcy, insolvency, gross negligence, gross
dereliction of duty, or gross misconduct, that Ms. Cooper is entitled to a lump
sum payment equal to three months salary, based on the salary being paid to Ms.
Cooper at the date of termination.
11
Prior to December 1, 2000, Teton had a consulting arrangement with Taimen
Corporation, to provide Teton with consulting and management services. Mr.
Cooper was the director and president of Taimen Corporation. Mr. Cooper and Ms.
Cooper were the sole employees of Taimen. Teton paid Taimen a total of $247,000
during the fiscal year ended December 31, 2000 and a total of $128,560 for the
fiscal year ended December 31, 1999.
In 2001, Mr. Cooper loaned $137,000 to Teton. Such loan, together with interest
at 8.28% per annum was due on February 1, 2002. The due date was subsequent
extended to April 15, 2002, and was paid in full in April 2002.
The Board of Directors believes that the terms of these transactions with its
management were at least as favorable to the Company as those terms which the
Company could have obtained from unrelated third parties through arms-length
negotiations.
12
OTHER BUSINESS
The Board of Directors is not aware of any other business that will
come before the Meeting, but if any such matters are properly presented, the
proxies solicited hereby will be voted in accordance with the best judgment of
the persons holding the proxies. All shares represented by duly executed proxies
will be voted at the Meeting.
STOCKHOLDER PROPOSALS
Stockholders who wish to submit proposals pursuant to Rule 14a-8 of the
1934 Act for inclusion in the Proxy Statement for the Company's 2003 Annual
Meeting of Stockholders must submit the same to Thomas F. Conroy, the Secretary
of Teton Petroleum Company on or before o at the Company's principal executive
office, P.O. Box 774327, Steamboat Springs, Colorado 80477.
AVAILABILITY OF CERTAIN DOCUMENTS REFERRED TO HEREIN
This proxy statement refers to certain documents of the company that
are not presented herein or delivered herewith. Such documents are available to
any person, including any beneficial owner, to whom this proxy statement is
delivered, upon oral or written request, without charge, directed to o, Teton
Petroleum Company, P.O. Box 774327, Steamboat Springs, Colorado 80477, telephone
number o. In order to ensure timely delivery of the documents, such requests
should be made by o, 2003.
It is important that the proxies be returned promptly and that your
shares be represented. Stockholders are urged to mark, date, execute and
promptly return the accompanying proxy card in the enclosed envelope.
By Order of the Board of Directors,
/s/ H. Howard Cooper
--------------------
H. Howard Cooper
President
Steamboat Springs, Colorado
January o, 2003
13
PROXY PROXY
TETON PETROLEUM COMPANY
PROXY FOR ANNUAL MEETING TO BE HELD ON MARCH 19, 2003
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints H. Howard Cooper, as proxy, with the
power to appoint his substitute, to represent and to vote all the shares of
common stock of Teton Petroleum Company (the "Company"), which the undersigned
would be entitled to vote, at the Company's Annual Meeting of Stockholders to be
held on March 19, 2003 and at any adjournments thereof, subject to the
directions indicated on the reverse side hereof.
In their discretion, the proxy is authorized to vote upon any other
matter that may properly come before the meeting or any adjournments thereof.
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS MADE,
BUT IF NO CHOICES ARE INDICATED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF
ALL NOMINEES AND FOR THE PROPOSALS LISTED ON THE REVERSE SIDE.
IMPORTANT--This Proxy must be signed and dated on the reverse side.
--------------------------------------------------------------------------------
14
THIS IS YOUR PROXY
YOUR VOTE IS IMPORTANT!
Dear Stockholder:
We cordially invite you to attend the Annual Meeting of Stockholders of
Teton Petroleum Company to be held at o, Steamboat Springs, Colorado 80477 on
March 19, 2003 at 10:00 a.m. (local time).
Please read the proxy statement which describes the proposals and
presents other important information, and complete, sign and return your proxy
promptly in the enclosed envelope.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1-3
1. Election of Directors -- FOR WITHHOLD
Nominees:
---------
H. Howard Cooper [_] [_]
Thomas F. Conroy [_] [_]
Karl F. Arleth [_] [_]
James F. Woodcock [_] [_]
--------------------------------------------------------------------------------
(Except nominee(s) written above)
FOR AGAINST ABSTAIN
2. Proposal to approve an amendment to [_] [_] [_]
the Articles of Incorporation to increase
the number of authorized shares of
common stock and create blank check
preferred stock
FOR AGAINST ABSTAIN
3. Proposal to adopt the 2002 Stock Option [_] [_] [_]
Plan
FOR AGAINST ABSTAIN
4. Proposal to approve the Reverse Stock Split [_] [_] [_]
FOR AGAINST ABSTAIN
5. Proposal to ratify Ehrhardt Keefe Steiner
& Hoffman PC as Independent Auditors [_] [_] [_]
If you plan to attend the Annual Meeting please mark this box [_]
Dated:________________, 2003
Signature ______________________________________________________________________
Name (printed) _________________________________________________________________
Title __________________________________________________________________________
Important: Please sign exactly as name appears on this proxy. When signing as
attorney, executor, trustee, guardian, corporate officer, etc., please indicate
full title.
--------------------------------------------------------------------------------
FOLD AND DETACH HERE
15
VOTE BY TELEPHONE OR INTERNET
QUICK *** EASY *** IMMEDIATE
TETON PETROLEUM COMPANY
o You can now vote your shares electronically through the
Internet or the telephone.
o This eliminates the need to return the proxy card.
o Your electronic vote authorizes the named proxies to vote your
shares in the same manner as if you marked, signed, dated and
returned the proxy card.
TO VOTE YOUR PROXY BY INTERNET
WWW.
Have your proxy card in hand when you access the above website. You will be
prompted to enter the company number, proxy number and account number to
create an electronic ballot. Follow the prompts to vote your shares.
TO VOTE YOUR PROXY BY MAIL
Mark, sign and date your proxy card above, detach it and return it in the
postage-paid envelope provided.
TO VOTE YOUR PROXY BY PHONE
1-800-
Use any touch-tone telephone to vote your proxy. Have your proxy card in
hand when you call. You will be prompted to enter the company number, proxy
number and account number. Follow the voting instructions to vote your
shares.
PLEASE DO NOT RETURN THE ABOVE CARD IF VOTED
ELECTRONICALLY
16
EXHIBIT A
CERTIFICATE OF AMENDMENT
TO
CERTIFICATE OF INCORPORATION
OF
TETON PETROLEUM COMPANY
The undersigned, being the President of TETON PETROLEUM COMPANY a
corporation existing under the laws of the State of Delaware, does hereby
certify under the seal of the said corporation as follows:
1. The certificate of incorporation of the Corporation is hereby
amended by replacing Article Fourth, in its entirety, with the following:
"FOURTH: The Corporation is authorized to issue two classes of
stock. One class of stock shall be Common Stock, par value $0.001. The
second class of stock shall be Preferred Stock, par value $0.001. The
Preferred Stock, or any series thereof, shall have such designations,
preferences and relative, participating, optional or other special
rights and qualifications, limitations or restrictions thereof as shall
be expressed in the resolution or resolutions providing for the issue
of such stock adopted by the Board of Directors and may be made
dependent upon facts ascertainable outside such resolution or
resolutions of the Board of Directors, provided that the matter in
which such facts shall operate upon such designations, preferences,
rights and qualifications; limitations or restrictions of such class or
series of stock is clearly and expressly set forth in the resolution or
resolutions providing for the issuance of such stock by the Board of
Directors.
The total number of shares of stock of each class which the Corporation
shall have authority to issue and the par value of each share of each
class of stock are as follows:
Class Par Value Authorized Shares
----- --------- -----------------
Common $0.001 2500,000,000
Preferred $0.001 25,000,000
------------
Totals: 275,000,000
3. The amendment of the certificate of incorporation herein certified
has been duly adopted by the unanimous written consent of the Corporation's
Board of Directors and a majority of the Corporation's stockholders in
accordance with the provisions of Sections 141(f), 228 and 242 of the General
Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to be
hereunto affixed and this Certificate of Amendment of the Corporation's
Certificate of Incorporation, as amended, to be signed by H. Howard Cooper, its
President, this __ day of February 2003.
TETON PETROLEUM COMPANY
By: /s/ ____________________
H. Howard Cooper, President
17