-----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, BIrasnva5kh6wJrYIOxDwP5zt76KBmuym965NcyT57aKWzk+vodd6+b4t/TTMS9H KGeKOhy0IYgHAx6JsHpaoQ== 0001012410-00-000037.txt : 20000407 0001012410-00-000037.hdr.sgml : 20000407 ACCESSION NUMBER: 0001012410-00-000037 CONFORMED SUBMISSION TYPE: 10-K405 PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000330 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ICHOR CORP CENTRAL INDEX KEY: 0000927761 STANDARD INDUSTRIAL CLASSIFICATION: 4955 IRS NUMBER: 251741849 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405 SEC ACT: SEC FILE NUMBER: 000-25132 FILM NUMBER: 586071 BUSINESS ADDRESS: STREET 1: 400 BURRARD STREET SUITE 1250 CITY: VANCOUVER BRITISH CO STATE: A1 ZIP: 15146 BUSINESS PHONE: 6046835767 MAIL ADDRESS: STREET 1: 300 OXFORD DR CITY: 400 BURRARD STREET S STATE: A1 ZIP: 15146 FORMER COMPANY: FORMER CONFORMED NAME: PDG REMEDIATION INC DATE OF NAME CHANGE: 19940801 10-K 1 ICHOR CORPORATION 10-K DECEMBER 31, 1999 1 ========================================================================== 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, 1999 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to --------- --------- Commission File Number 000-25132 ICHOR Corporation (Exact name of Registrant as specified in its charter) Delaware 25-1741849 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) Suite 1620, 400 Burrard Street Vancouver, British Columbia, Canada V6C 3A6 (Address of principal executive offices) (Postal Code) Registrant's telephone number, including area code: (604) 683-5767 Securities registered pursuant to Section 12(b) of the Act: None Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.01 par value (Title of Class) Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 --- --- 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. [ X ] The aggregate market value of the voting stock held by non-affiliates of the Registrant was approximately $4,656,900 as of March 15, 2000, computed on the basis of the average of the bid and ask prices on such date. As of March 27, 2000, there were 4,918,770 shares of the Registrant's Common Stock outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the Registrant's 1999 Proxy Statement to be filed within 120 days of the period ended December 31, 1999 are incorporated by reference into Part III. ========================================================================== 2 FORWARD-LOOKING STATEMENTS Statements in this report, to the extent they are not based on historical events, constitute forward-looking statements. Forward-looking statements include, without limitation, statements regarding the outlook for future operations, forecasts of future costs and expenditures, evaluation of market conditions, the outcome of legal proceedings, the adequacy of reserves, or other business plans. Investors are cautioned that forward- looking statements are subject to an inherent risk that actual results may vary materially from those described herein. Factors that may result in such variance, in addition to those accompanying the forward-looking statements, include changes in interest rates, prices, and other economic conditions; actions by competitors; natural phenomena; actions by government and regulatory authorities; uncertainties associated with legal proceedings; technological development; future decisions by management in response to changing conditions; and misjudgments in the course of preparing forward-looking statements. 2 3 TABLE OF CONTENTS ----------------- PAGE ---- PART I ------ ITEM 1. BUSINESS. . . . . . . . . . . . . . . . . . . . . . . . . . . .4 ITEM 2. PROPERTIES. . . . . . . . . . . . . . . . . . . . . . . . . . .5 ITEM 3. LEGAL PROCEEDINGS . . . . . . . . . . . . . . . . . . . . . . .6 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS . . . . . .6 PART II ------- ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS . . . . . . . . . . . . . . . . . . . . . .6 ITEM 6. SELECTED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . .7 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS . . . . . . . . . . . . . .7 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK . . . . . . . . . . . . . . . . . . . . . . . . . 10 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA . . . . . . . . . 10 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE . . . . . . . . . . . . . 10 PART III -------- ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. . . . . . 10 ITEM 11. EXECUTIVE COMPENSATION. . . . . . . . . . . . . . . . . . . . 10 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . . . 11 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS. . . . . . . . 11 PART IV ------- ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K . . . . . . . . . . . . . . . . . . . . . . . . . 11 SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 3 4 PART I ITEM 1. BUSINESS The Corporation ICHOR Corporation was incorporated in July 1994 pursuant to the laws of the Commonwealth of Pennsylvania under the name "PDG Remediation, Inc.". In November 1996, the Corporation reincorporated under the laws of the State of Delaware and changed its name to "ICHOR Corporation". In this document, unless the context otherwise requires, the "Corporation" refers to ICHOR Corporation and its subsidiaries. Development of the Corporation From its inception to December 1997, the Corporation operated in the environmental services business. The Corporation's initial operations included a thermal treatment facility in Florida and remediation services offices in Florida and Pennsylvania. In December 1996, the Corporation acquired a waste oil recycling facility in Illinois. The Corporation completed its initial public offering in February 1995. In July 1996, Drummond Financial Corporation ("Drummond") acquired a 59.5% interest in the Corporation from PDG Environmental, Inc. In December 1996, the Corporation issued approximately 50.3% of the Corporation's common stock to TriMaine Holdings, Inc. ("TriMaine") (previously Logan International Corp.) as partial consideration for a loan receivable through which the Corporation acquired its waste oil recycling facility. TriMaine and Drummond are controlled by MFC Bancorp Ltd. ("MFC"). In response to changes in the Florida market, the Corporation closed certain remediation services offices and sold certain remediation facilities in 1995 and 1996. The Corporation sold the balance of its remediation services operations in April 1997 and its waste oil recycling facility in December 1997. In March 1998, the Corporation sold its wholly-owned subsidiary, ICHOR Services, Inc. ("Services"). In 1998, following the sale of Services, ICHOR provided consulting services to an industrial customer in Europe. In the first quarter of 1998, the Corporation completed the issuance of an aggregate of 467,500 shares of 5% Cumulative Redeemable Convertible Preferred Stock, Series 1 of the Corporation to affiliates of MFC. In December 1998, Drummond and Logan transferred all of their shares of common stock of the Corporation to a wholly-owned subsidiary of MFC. In the last quarter of 1999 the Corporation completed the issuance of an aggregate of 97,206 shares of 5% Cumulative Redeemable Convertible Preferred Stock, Series 2 of the Corporation to Drummond in consideration of a debt forgiveness of $972,060. For further information with respect to this transaction, including the Debt Settlement Agreement between Drummond and the Corporation dated November 30, 1999, see the Corporation's Form 8-K dated December 7, 1999. On February 8, 2000, the Corporation's securities were delisted from the Nasdaq SmallCap Market for failure to meet listing qualifications. For further information with respect to such matter see the Corporation's Form 8-K dated February 9, 2000. 4 5 Current Business In October, 1998, the Company entered into an agreement (the "Original Purchase Agreement") with the shareholders of Nazca Holdings Ltd. ("Nazca") to acquire all of the issued and outstanding shares of Nazca. Effective June 30, 1999, the Corporation and the former majority shareholders of Nazca entered into a revised agreement (the "Revised Agreement"), pursuant to which, the Original Purchase Agreement was replaced and the Corporation acquired approximately 87% of the issued and outstanding shares of common stock of Nazca. Nazca, through a subsidiary, is in the business of the exploration for and development of ground water resources in Chile. Chile is divided into seven regions (referred to herein as "Regions I - VII") having separate regimes dealing with the grant and administration of Water Rights ("Water Rights"). Nazca completed a hydrogeological reconnaissance of Regions I and II in 1995 and 1996. Nazca's hydrogeological reconnaissance of Regions III - VII is currently ongoing. Nazca, through a subsidiary company, has applied for a number of exploration concessions (each a "Concession") and has been granted three Concessions to date and expects to be granted one additional Concession in the near future. Exploration and development work is continuing with respect to Concessions having a potential production capacity of 1,300 litres/ second, with the objective of establishing perpetual Water Rights and supplying ground water to customers under long term supply agreements. A Water Right provides the holder a perpetual right to sell the amount of water flow (calculated in litres/second) from the Well which the Water Right pertains to. Following application, it can take up to two years for a Water Right to be granted. Following the grant of Water Rights, water may be legally sold by the holder thereof. To complete delivery of a water resource to an end-user, construction of a pumping station and piping to transmit the water must be completed, following which production and sales of water may commence. An alternative available to Nazca is to sell Water Rights after they are obtained rather than proceeding with the development of an operating utility. To date, applications for Water Rights for 57 litres/second of flow have been applied for by Nazca and are outstanding with the Direccion General de Aquas of Chile. In connection with the Revised Agreement, the Corporation granted options in favour of certain former shareholders of Nazca, allowing them to repurchase shares of Nazca common stock sold to the Corporation in certain circumstances. In December of 1999, two former shareholders of Nazca purported to exercise their options to repurchase approximately 38% of Nazca's common stock. The Corporation believes the attempted exercise of the former shareholders' options to be invalid as certain conditions required to be met prior to exercise were not satisfied. However, as a result of the dispute the Corporation has accounted for its interest in Nazca on an equity accounting basis after having given effect to the purported option exercise. At December 31, 1999, the Corporation had no employees. ITEM 2. PROPERTIES The Corporation's administrative facilities are located on leased premises located in Vancouver, British Columbia, Canada. 5 6 ITEM 3. LEGAL PROCEEDINGS The Corporation is subject to routine litigation incidental to its business. The Corporation does not believe that the outcome of such litigation will have a material adverse effect on its business or financial condition. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS Not applicable. PART II ------- ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS (a) Market Information. The Corporation's common stock were quoted on the NASDAQ SmallCap Market under the trading symbol "ICHR" until February 8, 2000 when the Corporation's securities were delisted from The Nasdaq Stock Market. The following table sets forth the quarterly high and low sale price per share of the Corporation's common stock for the periods indicated: Fiscal Quarter Ended High Low - - -------------------- ---- ---- 1998 March 31 $ 1.75 $ 1.25 June 30 2.00 1.25 September 30 2.25 1.25 December 31 3.25 1.25 1999 March 31 $ 2.88 $ 1.25 June 30 3.25 1.50 September 30 4.63 1.00 December 31 5.00 2.00 (b) Shareholders. At March 27, 2000, the Corporation had approximately 15 holders of record of its common stock, some of which are securities clearing agencies and intermediaries. (c) Dividends. The Corporation has not paid any dividends on its common stock and does not anticipate that it will pay any dividends in the foreseeable future. 6 7 ITEM 6. SELECTED FINANCIAL DATA The following table reflects selected consolidated financial data for the Corporation for the fiscal years ended December 31, 1999, 1998 and 1997, respectively, the 11 months ended December 31, 1996 and the fiscal year ended January 31, 1996. In September 1996, the Corporation changed its fiscal year end from January 31 to December 31.
For the Year For the Year For the Year For the 11 For the Year Ended Ended Ended Months Ended Ended December 31, December 31, December 31, December 31, January 31, ------------ ------------ ------------ ------------ ------------ 1999 1998 1997 1996 1996 ------------ ------------ ------------ ------------ ------------ (Dollars in thousands, except per share amounts) OPERATING DATA Fee income $ - $ 144 $ - $ - $ - General and administrative expenses 373 497 418 1,042 791 Interest expense 192 102 613 423 406 Loss from continuing operations (470) (178) (1,025) (1,320) (1,183) Net loss (470) (178) (4,054) (1,399) (2,858) COMMON SHARE DATA Loss from continuing operations per common share (0.14) (0.08) (0.21) (0.51) (0.48) Net loss per common share (0.14) (0.08) (0.83) (0.54) (1.16) Weighted average common shares outstanding (in thousands) 4,910 4,908 4,913 2,586 2,456 BALANCE SHEET DATA Working capital 2,289 2,141 89 3,903 2,417 Total assets 2,681 3,281 2,028 5,582 5,578 Long-term obligations - - - 1,916 - Total stockholders' equity 2,652 2,141 89 1,987 2,438 - - ------------ (1) Basic and diluted common share data is the same.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of the results of operations and financial condition of the Corporation for the years ended December 31, 1999, 1998 and 1997, respectively, should be read in conjunction with the Corporation's audited consolidated financial statements and related notes included elsewhere herein. . The Corporation sold its environmental remediation services operations in April 1997 and a waste oil recycling facility in December 1997. These operations have been accounted for as discontinued operations for the year ended December 31, 1997. Certain reclassifications have been made to the prior periods' financial statements to conform to the current period's method of presentation. 7 8 Results of Operations for the Year Ended December 31, 1999 Compared to the Year Ended December 31, 1998 Revenues for the year ended December 31, 1999 decreased to $0.2 million, from $0.7 million for the comparative period of 1998 primarily as a result of the sale by the Corporation of Ichor Services, Inc. ("Services"), a wholly-owned subsidiary of the Corporation, in the first quarter of 1998 which was reported as a gain on disposal of a subsidiary in 1998. Costs and expenses decreased to $0.7 million in the year ended December 31, 1999 from $0.9 million in the year ended December 31, 1998 primarily as a result of a decrease in general and administrative expenses resulting from the sale of Services and lower head office expenses, partially offset by an equity loss related to Nazca. In the year ended December 31, 1998, the Corporation had accrued $0.3 million in settlement of a class action lawsuit. Interest expense increased to $0.2 million in the year ended December 31, 1999 from $0.1 million in the year ended December 31, 1998 primarily as a result of interest paid on an amount owing under a line of credit with an affiliate. General and administrative expenses for the year ended December 31, 1999 decreased to $0.4 million from $0.5 million in the comparative period of 1998, primarily as a result of a decrease in employees of the Corporation. The Corporation reported a net loss of $0.5 million, or $0.14 per share, in the year ended December 31, 1999. In the year ended December 31, 1998, the Corporation reported a net loss of $0.2 million, or $0.08 per share. Results of Operations for the Year Ended December 31, 1998 Compared to the Year Ended December 31, 1997 Revenues for the year ended December 31, 1998 increased to $0.7 million, from $6,000 for the comparative period of 1997. In the year ended December 31, 1998, the Corporation reported income of $0.1 million from consulting fees. Effective March 31, 1998, the Corporation sold Services and recognized a non-cash accounting gain of $0.4 million on the sale as a result of the disposal of net liabilities of Services. Costs and expenses decreased to $0.9 million in the year ended December 31, 1998 from $1.0 million in the year ended December 31, 1997. Interest expense decreased to $0.1 million in the year ended December 31, 1998 from $0.6 million in the year ended December 31, 1997, primarily as a result of the sale of Services in the first quarter of 1998, which had financed certain receivables for work performed under certain Florida State rehabilitation programs. General and administrative expenses for the year ended December 31, 1998 increased to $0.5 million from $0.4 million in the comparative period of 1997, primarily as a result of an increase in professional fees. In the year ended December 31, 1998, the Corporation paid $0.3 million in settlement of a class action lawsuit. The Corporation reported a net loss of $0.2 million, or $0.08 per share, in the year ended December 31, 1998. In the year ended December 31, 1997, the Corporation reported a net loss of $4.1 million, or $0.83 per share, which included a loss of $3.0 million, or $0.62 per share, from discontinued operations. 8 9 Liquidity and Capital Resources The Corporation had cash of $2.3 million at December 31, 1999, compared to $50,000 at December 31, 1998. The Corporation maintains a line of credit with an affiliate in the amount of $0.8 million to fund working capital requirements. The line of credit was fully utilized and repaid by the issuance of preferred stock as at December 31, 1999. Net cash provided by operating activities was $0.6 million in the year ended December 31, 1999, compared to cash used by operating activities of $0.9 million in the year ended December 31, 1998. A decrease in accounts receivable provided cash of $0.5 million in the year ended December 31, 1999, compared to an increase in same using cash of $0.3 million in the comparable period of 1998. An increase in accounts payable and other liabilities provided cash of $21,000 in the year ended December 31, 1999 and used cash of $0.1 million in the year ended December 31,1998. Investing activities provided cash of $1.6 million in the year ended December 31, 1999 primarily as a result of payment received on a promissory notes held by the Corporation. Investing activities in the year ended December 31, 1998 used cash of $1.5 million, primarily as a result of the acquisition of a note receivable. On October 20, 1998, the Corporation entered into an agreement to acquire all of the issued and outstanding shares of common stock of Nazca, which is in the business of the exploration for and development of ground water resources in Chile. See "Item 1. Business - Current Business" herein for further details with respect to the agreement. Under a revised agreement entered into with the majority shareholders of Nazca in July 1999, the original purchase agreement was replaced and the Corporation acquired approximately 87% of the issued and outstanding shares of common stock of Nazca effective June 30, 1999. For further information with respect to the transaction, including the revised agreement, see the Corporation's Form 8-K/A dated August 12, 1999, which is incorporated herein by reference. In November of 1999, the Corporation collected all outstanding principal and interest due on a note receivable in the principal amount of $1.4 million, and collected the full amount of approximately $0.6 million due from an affiliate. In addition, in November of 1999 the Corporation repaid approximately $0.3 million in advances from affiliates. Financing activities provided cash of $9,000 in the year ended December 31, 1999, compared to $2.2 million in the year ended December 31, 1998. The Corporation believes that its assets and line of credit should enable the Corporation to meet its current ongoing requirements. The Corporation anticipates that it may require substantial capital to pursue current and future acquisitions of businesses and/or operating assets and will seek such capital through debt and/or equity financing. 9 10 Year 2000 Many of the world's computer systems currently record years in a two-digit format. These computer systems may be unable to properly interpret dates beyond the year 1999, which could lead to business disruptions and is commonly referred to as the "Year 2000" issue. To date, the Corporation has not experienced any significant problems as a result of the Year 2000 issue and based on its current information, management of the Corporation has determined that the Year 2000 issue will not pose significant operational problems for its computer systems as it only utilizes commercially available software and personal computers, which are Year 2000 compliant. The total cost to the Corporation of Year 2000 compliance activities has not been and is not currently anticipated to be material to its financial position or results of operations in any given year. In addition, management of the Corporation has had communications with clients to ascertain their Year 2000 readiness and developed contingency plans as required. The determination by management and costs relating to the Year 2000 issue are based on management's best estimates, which were derived utilizing numerous assumptions of future events. However, there can be no assurance that these estimates will be achieved and actual results could vary materially from those anticipated. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Not applicable. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA The consolidated financial statements and supplementary data required with respect to this Item 8, and as identified in Item 14 of this annual report, are included in this annual report commencing on page 14. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT Incorporated by reference from the Corporation's definitive proxy statement to be filed within 120 days of the end of the Corporation's fiscal year. ITEM 11. EXECUTIVE COMPENSATION Incorporated by reference from the Corporation's definitive proxy statement to be filed within 120 days of the end of the Corporation's fiscal year. 10 11 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT Incorporated by reference from the Corporation's definitive proxy statement to be filed within 120 days of the end of the Corporation's fiscal year. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Incorporated by reference from the Corporation's definitive proxy statement to be filed within 120 days of the end of the Corporation's fiscal year. PART IV ------- ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K (a) (1) Index to Financial Statements Independent Auditors' Report Consolidated Balance Sheets Consolidated Statements of Operations Consolidated Statements of Changes in Shareholders' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements (2) Financial Statement Schedules Independent Auditors' Report Schedule II - Valuation and Qualifying Accounts Schedule III - Unaudited Financial Statements of Nazca Holdings Ltd. All other schedules have been omitted because they are not applicable or the required information is shown in the financial statements or notes thereto.
(3) List of Exhibits 2.1 Agreement and Plan of Merger dated October 1, 1996 between ICHOR Corporation and PDG Remediation, Inc. Incorporated by reference to the Corporation's Schedule 14C dated September 17, 1996. 3.1 Articles of Incorporation. 3.2 Certificate of Designations. Incorporated by reference to the Corporation's Form 8-K dated March 12, 1998. 3.3 Certificate of Designations. Incorporated by reference to the Corporation's Form 8-K dated December 7, 1999. 3.4 Bylaws. 11 12 10.1 Amended 1994 Stock Option Plan. 10.2 1995 Qualified Incentive Stock Option Plan. 10.3 Loan Agreement dated January 15, 1997 among Drummond Financial Corporation, the Corporation and ICHOR Services, Inc. 10.4 Debt Settlement Agreement between Logan International Corp. and the Corporation dated February 20, 1998. 10.5 Debt Settlement Agreement between Sutton Park International Ltd. and the Corporation dated February 20, 1998. 10.6 Subscription Agreement between Constable Investments Ltd. and the Corporation dated February 26, 1998. 10.7 Subscription Agreement between Conqueror Holdings Ltd. and the Corporation dated February 26, 1998. 10.8 Subscription Agreement between Sutton Park International Ltd. and the Corporation dated February 26, 1998. 10.9 Subscription Agreement between Zellstoff-und Papierfabrik Rosenthal GmbH and the Corporation dated February 26, 1998. 10.10 Purchase Agreement between the Corporation and the majority shareholders of Nazca Holdings Ltd. dated October 17, 1998. Incorporated by reference to the Corporation's Form 8-K dated October 20, 1998. 10.11 Amendment to the Agreement between the Corporation and the majority shareholders of Nazca Holdings Ltd. dated October 17, 1998. Incorporated by reference to the Corporation's Form 8- K/A dated April 9, 1999. 10.12 Revised Purchase Agreement between the Corporation and the majority shareholders of Nazca Holdings Ltd. dated July 28, 1999. Incorporated by reference to the Corporation's Form 8- K/A dated August 12, 1999. 10.13 Debt Settlement Agreement between Drummond Financial Corporation and the Corporation dated November 30, 1999. Incorporated by reference to the Corporation's Form 8-K dated December 7, 1999. 23 Consent of Independent Auditors. 27 Article 5 - Financial Data Schedule for the year ended December 31, 1999. - - ------------------ (1) Incorporated by reference to the Corporation's Form 10-K dated January 31, 1996. (2) Incorporated by reference to the Corporation's Definitive Schedule 14A dated July 8, 1996. (3) Incorporated by reference to the Corporation's Form 10-K dated December 31, 1997. (4) Incorporated by reference to a Schedule 13D\A dated March 13, 1998. (5) Incorporated by reference to the Corporation's Form 10-K dated December 31, 1996.
12 13 (b) Reports on Form 8-K The Corporation filed the following reports with respect to the indicated items: Form 8-K dated October 26, 1999: Item 5. Other Events Form 8-K/A dated November 15, 1999: Item 5. Other Events Item 7. Financial Statements and Exhibits Form 8-K dated December 7, 1999: Item 5. Other Events Item 7. Financial Statements and Exhibits Form 8-K/A dated December 8, 1999: Item 5. Other Events Form 8-K dated February 9, 2000: Item 5. Other Events 13 14 - - -------------------------------------------------------------------------- PETERSON SULLIVAN P.L.L.C. 601 UNION STREET SUITE 2300 SEATTLE WA 98101 (206) 382-7777 FAX 382-7700 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' REPORT ---------------------------- To the Board of Directors and Shareholders Ichor Corporation and Subsidiary We have audited the consolidated balance sheets of Ichor Corporation and Subsidiary as of December 31, 1999 and 1998, and the related consolidated statements of operations, changes in shareholders' equity, and cash flows for the years ended December 31, 1999, 1998 and 1997. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes 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 Ichor Corporation and Subsidiary as of December 31, 1999 and 1998, and the results of their operations and their cash flows for the years ended December 31, 1999, 1998 and 1997, in conformity with generally accepted accounting principles. /s/ Peterson Sullivan P.L.L.C. March 24, 2000 Seattle, Washington 14 15 ICHOR CORPORATION AND SUBSIDIARY CONSOLIDATED BALANCE SHEETS December 31, 1999 and 1998 (In Thousands of Dollars)
ASSETS 1999 1998 --------- --------- Current Assets Cash and cash equivalents $ 2,262 $ 50 Accounts receivable 56 560 Notes receivable - 2,080 Advances to affiliates - 540 Other assets - 51 --------- --------- Total current assets 2,318 3,281 Investment in and advances to unconsolidated subsidiary 363 - --------- --------- $ 2,681 $ 3,281 ========= =========
The accompanying notes are an integral part of these financial statements. 15 16
LIABILITIES AND SHAREHOLDERS' EQUITY 1999 1998 --------- --------- Current Liabilities Accounts payable and other liabilities $ 29 $ 8 Advances from affiliates - 1,132 --------- --------- Total current liabilities 29 1,140 Shareholders' Equity Preferred stock, $.01 par value; 5,000,000 shares authorized; Series 1, nonvoting; shares issued and outstanding 564,706 at December 31, 1999, and 467,500 at December 31, 1998 6 5 Common stock, $.01 par value; 30,000,000 shares authorized; shares issued 4,981,570 at December 31, 1999, and 4,970,320 at December 31, 1998 50 50 Additional paid-in capital on preferred stock 5,371 4,400 Additional paid-in capital on common stock 5,752 5,743 Retained deficit (8,456) (7,986) --------- --------- 2,723 2,212 Less cost of 62,800 shares of common stock held in treasury at December 31, 1999 and 1998 (71) (71) --------- --------- 2,652 2,141 --------- --------- $ 2,681 $ 3,281 ========= =========
The accompanying notes are an integral part of these financial statements. 16 17 ICHOR CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS Years Ended December 31, 1999, 1998 and 1997 (In Thousands of Dollars, Except for Per Share Amounts)
1999 1998 1997 ------ ------ -------- Revenues Interest $ 153 $ 92 $ 6 Fees - 144 - Gain on disposal of a subsidiary - 437 - Other 30 8 - ------ ------ -------- 183 681 6 Costs and expenses General and administrative 373 497 418 Interest 192 102 613 Litigation settlement - 260 - Equity in loss of unconsolidated subsidiary 88 - - ------ ------ -------- 653 859 1,031 Loss from continuing operations (470) (178) (1,025) Discontinued operations (any tax benefits from losses are fully reserved; any taxes associated with gains are offset by tax losses) Loss from operation of environmental remediation services segment - - (489) Gain on sale of environmental remediation services segment - - 59 Loss from operation of waste oil recycling facility - - (1,224) Loss on sale of waste oil recycling facility - - (1,375) ------ ------ -------- Loss from discontinued operations - - (3,029) ------ ------ -------- Net loss $ (470) $ (178) $ (4,054) Basic loss per common share Loss from continuing operations $ (.14) $ (.08) $ (.21) Discontinued operations - - (.62) ------ ------ -------- Net loss $ (.14) $ (.08) $ (.83) ====== ====== ========
The accompanying notes are an integral part of these financial statements. 17 18 ICHOR CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY Years Ended December 31, 1999, 1998 and 1997 (In Thousands of Dollars)
--------------Common Stock------------- ------------Preferred Stock----------- Additional Additional Number Par Paid-in Treasury Number of Par Paid-in Retained of Shares Value Capital Stock Shares Value Capital Deficit Total --------- ----- --------- -------- --------- ----- ---------- -------- ----- Balance at December 31, 1996 4,922,720 $ 50 $ 5,743 $ (52) - $ - $ - $ (3,754) $1,987 Net loss - - - - - - - (4,054) (4,054) Conversion of debt by other subsidiaries of the Company's parent - - - - 217,500 2 2,173 - 2,175 Repurchase of common stock held in treasury (15,200) - - (19) - - - - (19) --------- ----- -------- -------- ------ ------- ------- ----------- ------- Balance at December 31, 1997 4,907,520 50 5,743 (71) 217,500 2 2,173 (7,808) 89 Net loss - - - - - - - (178) (178) Preferred shares issued for cash (215,000 shares purchased by related parties at $10 per share) - - - - 250,000 3 2,227 - 2,230 --------- ----- -------- --------- ------- ------ ------- --------- ------- Balance at December 31, 1998 4,907,520 50 5,743 (71) 467,500 5 4,400 (7,986) 2,141 Net loss - - - - - - - (470) (470) Shares issued for exercise of options 11,250 - 9 - - - - - 9 Preferred shares issued for payment of debt to another subsidiary of MFC - - - - 97,206 1 971 - 972 --------- ----- -------- --------- ------- ------- ------ --------- ------ Balance at December 31, 1999 4,918,770 $ 50 $ 5,752 $ (71) 467,500 5 4,400 (7,986) 2,141 ========= ===== ======== ========= ======= ======= ====== ========== =======
The accompanying notes are an integral part of these financial statements. 18 19 ICHOR CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended December 31, 1999, 1998 and 1997 (In Thousands of Dollars)
1999 1998 1997 ------ ------ ------ Cash Flows from Operating Activities Net loss $ (470) $ (178) $(4,054) Adjustments to reconcile net loss to cash flows from operating activities Equity in loss of unconsolidated subsidiary 88 - - Gain on disposal of subsidiary - (437) - Changes in current assets and liabilities Cash held in escrow - 145 637 Accounts receivable 504 (254) (185) Advances to affiliates 540 (270) (270) Prepaid expenses and other assets - - 106 Accounts payable and other liabilities 21 (115) (403) Advances from affiliates (160) 352 360 Net assets of discontinued operations - - 2,723 Other 51 (100) 42 ------ ------ ------ Net cash provided by (used in) operating activities 574 (857) (1,044) Cash Flows from Investing Activities Change in note receivable 2,080 (1,400) - Advances to unconsolidated subsidiary (451) - - Investment - (50) - ------ ------ ------ Net cash provided by (used in) investing activities 1,629 (1,450) - Cash Flows from Financing Activities Proceeds from issuance of preferred shares - 2,230 - Proceeds from issuance of common shares 9 - - Purchase of stock held in treasury - - (19) Proceeds from debt - - 750 Principal payments on debt - - (188) ------ ------ ------ Net cash provided by financing activities 9 2,230 543 ------ ------ ------ Increase (decrease) in cash 2,212 (77) (501) Cash, beginning of year 50 127 628 ------ ------ ------ Cash, end of year $ 2,262 $ 50 $ 127
The accompanying notes are an integral part of these financial statements. 19 20 ICHOR CORPORATION AND SUBSIDIARY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In Thousands of Dollars, Except for Per Share Amounts) Note 1. The Company and Summary of Significant Accounting Policies The Company - - ----------- Under an agreement, effective June 30, 1999, Ichor Corporation ("the Company") completed the acquisition of its present interest in Nazca Holdings Ltd. ("NHL"). A wholly-owned subsidiary of NHL is in the business of locating and developing ground water resources in Chile to be sold to mining, agricultural and public utility customers. NHL is included in these consolidated financial statements under the equity method beginning July 1, 1999. The Company was a subsidiary of MFC Bancorp Ltd. ("MFC") until December 1999. Prior to December 1997, the Company was in the environmental industry, providing environmental remediation services and operating a recycling waste oil facility. The Company sold the remediation services segment of its business in April 1997 for $147 in cash and retained the segment's current assets and liabilities. The waste oil recycling facility was sold in December 1997 for $1,000 including $320 in cash and a $680 note which was paid in 1999. Both segments were accounted for as discontinued operations and unless otherwise stated, all notes to financial statements relate to continuing operations. Further, in March 1998, the Company sold a subsidiary at a non-cash accounting gain of $437 which resulted from the assumption of the subsidiary's liabilities by the purchaser. Principles of Consolidation - - --------------------------- The consolidated financial statements include the accounts of the Company and its subsidiary. Significant intercompany accounts and transactions have been eliminated. Cash and Cash Equivalents - - ------------------------- Cash equivalents consist of highly liquid debt instruments with maturities of three months or less. Cash balances are occasionally in excess of federally insured amounts. Taxes on Income - - --------------- The Company accounts for income taxes under an asset and liability approach that requires the recognition of deferred tax assets and liabilities for expected future tax consequences of events that have been recognized in the Company's financial statements or tax returns. In estimating future tax consequences, the Company generally considers all expected future events other than enactments of changes in the tax laws or rates. 20 21 Note 1. (Continued) Earnings Per Share - - ------------------ Basic earnings per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding in the period. Diluted earnings per share takes into consideration common shares outstanding (computed under basic earnings per share) and potentially dilutive common shares. The conversion of convertible preferred stock and stock options have not been reflected as exercised for the purposes of computing earnings or loss per share since the conversion of such stock or exercise of such options would be antidilutive. The weighted average number of shares was 4,910,386, 4,907,520 and 4,912,643 for the years ended December 31, 1999, 1998 and 1997. The loss from operations to compute the amount attributable to common shareholders includes the recognition of preferred stock dividends in arrears of $237, $214 and none for 1999, 1998 and 1997, respectively. Preferred Stock - - --------------- The entire redemption value of Preferred Shares, Series 1, can be exchanged for common stock at 90% of the common stock average market price (as defined). Redemption value is $10 per share and shares are redeemable only by the Company with a 30 day notice. The Preferred Shares, Series 1, have a liquidation preference over other stock to the extent of the redemption value plus unpaid dividends. This stock has an annual cumulative dividend rate of 5%, payable quarterly and no dividends may be paid on common stock if preferred share dividends are in arrears. Stock-Based Compensation - - ------------------------ Compensation expense for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock. There is no stock-based compensation included in these consolidated financial statements. Use of Estimates - - ---------------- The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Fair Value of Financial Instruments - - ----------------------------------- The fair value of the notes receivable and advances to/from an affiliate at December 31, 1998, were estimated to approximate their recorded values based on the terms of the instruments. Notes receivable at December 31, 1998, included $1,400 from one company which was secured and had interest at 8.75%. Interest paid amounted to none, $102 and $613 for 1999, 1998 and 1997, respectively. 21 22 Note 1. (Continued) New Accounting Standard - - ----------------------- Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" is effective for periods beginning after June 15, 2000, and establishes accounting and reporting standards for derivative instruments and for hedging activities. This statement requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. Because the Company does not engage in any derivative or hedging activities, there should be no impact on its financial statements. Note 2. Investment In and Advances To Unconsolidated Subsidiary The Company advanced $451 to NHL and has agreed to pay 20% of future operating cash flows, as defined, of the Chilean operations discussed in Note 1 for the NHL shares. The following is a summary of NHL's financial position at December 31, 1999, and the results of its operations for the six-month period ended December 31, 1999. Assets $ 1,313 Liabilities 1,231 Shareholders' equity 82 Revenues $ 49 Net loss 180 Note 3. Income Taxes The reconciliation of income tax on income from continuing operations computed at the federal statutory rates to income tax expense is as follows:
Years Ended December 31 ------------------------------------------ 1999 1998 1997 -------- -------- -------- Tax at statutory rate $ (160) $ (60) $ (349) Permanent difference associated with gain on disposal of subsidiary - (149) - Equity in loss of unconsolidated subsidiary 30 - - Valuation allowance 130 209 377 Other - - (28) -------- -------- -------- $ - $ - $ - ======== ======== ========
22 23 Note 3. (Continued) The significant components of the Company's deferred tax asset as of December 31, 1999 and 1998, is as follows:
1999 1998 -------- -------- Net operating loss carryforward $ 1,158 $ 1,028 Valuation allowance for deferred tax asset (1,158) (1,028) -------- -------- Net deferred tax asset $ - $ - ======== ========
The Company has a net operating loss carryforward of approximately $3,407 at December 31, 1999, which expires at: $756 in 2010; $35 in 2011; $1,449 in 2012; $785 in 2018; $382 in 2019. The Company's utilization of the losses is subject to limitation due to ownership and operational changes, except those that expire in 2012 and 2013. Note 4. Stock Option Plans 1994 Amended Stock Option Plan - - ------------------------------ The Company's 1994 stock option plan provides for the issuance of up to 350,000 shares of the Company's common stock to employees and non-employee directors. The following table summarizes information with respect to this plan:
Weighted Average Number of Exercise Shares Price --------- -------- Outstanding at January 1, 1997 179,500 $ .81 Granted 145,000 2.00 Canceled - Reusable (89,500) 1.10 -------- Outstanding at December 31, 1997 235,000 1.39 Canceled - Reusable (30,000) 1.19 -------- Outstanding at December 31, 1998 205,000 1.51 Exercised (11,250) .75 -------- Exercisable at December 31, 1999 193,750 $ 1.55 ======== ======= Reserved for future grants at December 31, 1999 145,000 ========
Almost all options have an expiration date ten years after issuance. 23 24 Note 4. (Continued) 1995 Qualified Incentive Stock Option Plan - - ------------------------------------------ The Company's board of directors approved a second stock option plan on August 15, 1996 which provides for the issuance of up to 150,000 shares of the Company's common stock to key employees. The following table summarizes information with respect to this plan:
Weighted Average Number of Exercise Shares Price --------- -------- Outstanding at January 1, 1997 125,000 $ .75 Granted - - Canceled - Reusable (25,000) .75 --------- Outstanding at December 31, 1999, 1998 and 1997 100,000 $ .75 ========= ======== Reserved for future grants at December 31, 1999 50,000 =========
Compensation - - ------------ For both the 1994 Amended Stock Option Plan and the 1995 Qualified Incentive Stock Option Plan, when options are granted, or the exercise price is adjusted, the exercise price cannot be less than the fair market value of the Company's common stock (as defined). However, had compensation expense been recognized on the basis of fair value pursuant to Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation," instead of the method used by the Company, there would have been no proforma effect with respect to net loss at either December 31, 1999 or 1998, and the effect at December 31, 1997, was not material. 24 25 - - -------------------------------------------------------------------------- PETERSON SULLIVAN P.L.L.C. 601 UNION STREET SUITE 2300 SEATTLE WA 98101 (206) 382-7777 FAX 382-7700 CERTIFIED PUBLIC ACCOUNTANTS INDEPENDENT AUDITORS' REPORT To the Board of Directors and Shareholders Ichor Corporation and Subsidiary Our report on the consolidated financial statements of Ichor Corporation and Subsidiary is included on page 14 of this Form 10-K. In connection with our audits of such financial statements, we have also audited the related financial statement schedule listed in Item 14 of this Form 10-K. In our opinion, the financial statement schedule referred to above, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly in all material respects the information set forth therein. /s/ Peterson Sullivan P.L.L.C. March 24, 2000 Seattle, Washington 25 26 ICHOR CORPORATION AND SUBSIDIARY SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS Year Ended December 31, 1999, 1998 and 1997 (In Thousands of Dollars)
Additions ------------------ Balance at Charged Balance at beginning Charged to other close of period to income accounts Deductions of period ---------- --------- -------- ---------- ---------- Year Ended December 31, 1999 Allowance for doubtful accounts $ - $ - $ - $ - $ - ========= ======== ======== ========= ========== Year Ended December 31, 1998 (2) Allowance for doubtful accounts $ 562 $ - $ - $ 562 $ - ========= ======== ======== ========= ========== Year Ended December 31, 1997 (1) Allowance for doubtful accounts $ 690 $ 2 $ - $ 130 $ 562 ========= ======== ======== ========= ==========
(1) Allowance for uncollectibility sold in conjunction with sale of waste oil recycling facility. (2) Allowance for uncollectibility sold in conjunction with sale of ICHOR Services, Inc. 26 27 ICHOR CORPORATION AND SUBSIDIARY SCHEDULE III - UNAUDITED FINANCIAL STATEMENTS OF NAZCA HOLDINGS LTD. NAZCA HOLDINGS LTD. CONSOLIDATED BALANCE SHEET December 31, 1999 and 1998 Expressed in U.S. dollars (Unaudited)
1999 1998 ASSETS Current Assets Tax debtors $ 30,058 $ 22,492 Directors' and employees' advances - 456 Cash at bank and in hand 2,291 5,791 ---------- ---------- 32,349 28,739 Fixed Assets Office Equipment 6,289 8,385 Database 140,000 140,000 Concession development direct expenditure 1,134,099 835,430 ---------- ---------- $1,312,737 $1,012,554 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Amounts due to directors and employees $ 269,999 $ 78,203 Amount due to affiliates 794,941 339,619 Tax creditors - 5,002 Accrued expenses 166,047 133,120 ---------- ---------- 1,230,987 555,944 Shareholders' Equity Share capital 1,079,021 1,079,021 Accumulated deficit (997,271) (622,411) ---------- ---------- 81,750 456,610 ---------- ---------- $1,312,737 $1,012,554 ========== ==========
27 28 NAZCA HOLDINGS LTD. CONSOLIDATED PROFIT & LOSS ACCOUNT For the years ended December 31, 1999 and 1998 Expressed in U.S. dollars (Unaudited)
1999 1998 Income Consultancy income $ 48,681 $ - Expenses Directors' fees - 51,000 Directors' and employees' salaries and benefits 209,976 140,655 Legal and accounting fees 56,242 32,976 Administration and general expenses 100,835 57,599 Interest charge 22,527 16,402 Depreciation 2,096 1,000 Exchange losses 31,865 - --------- --------- 423,541 299,632 --------- --------- Loss for the year (374,860) (299,632) Accumulated deficit brought forward (622,411) (322,779) --------- --------- Accumulated deficit carried forward $(997,271) $(622,411) ========= =========
28 29 NAZCA HOLDINGS LTD. Notes to the Consolidated Accounts For the years ended December 31, 1999 and 1998 (Unaudited) 1. PRINCIPAL ACCOUNTING POLICIES i) Basis of accounting The accounts have been prepared under the historical cost convention, and in accordance with United States generally accepted accounting principles. ii) Basis of consolidation The consolidated accounts include the accounts of the company and its wholly-owned subsidiary company Nazca S.A. iii) Fixed Assets Office equipment is stated at cost less accumulated depreciation. Depreciation is computed to write down the cost over the estimated useful lives of the assets. The investment in the database is stated at cost. Concession development direct expenditure is stated at cost. Amortisation will be computed to write down the cost over the estimated economic lives of the concessions, as soon as supply is commenced. 2. SUBSIDIARY COMPANY Nazca S.A. is a development stage enterprise incorporated in Chile in November 1995 with the objective of exploring, developing and exploiting natural resources. It started water exploration activities in early 1996 in the northern regions of Chile where it owns several exploration concessions. The subsidiary company keeps its accounting records in Chilean currency, and its accounts have first been converted to United States generally accepted accounting principles and then translated into U.S. dollars. 3. FUTURE OPERATIONS AND FINANCING Further financing arrangements through the sale of equity and offtake agreements for the sale of water are being negotiated. This financing will be used for development work including exploration and production well drilling and securing water rights on a number of concessions that the subsidiary company controls in northern Chile over the next 2 years. 29 30 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. Date: March 29, 2000 ICHOR CORPORATION By: /s/ J. Choi ---------------------------- J. Choi, President, and Director 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. /s/ J. Choi March 29, 2000 - - ------------------------- J. Choi President and Director /s/ Young-Soo Ko March 29, 2000 - - ------------------------- Young-Soo Ko Director /s/ Jae-Sun Lee March 29, 2000 - - ------------------------- Jae-Sun Lee Director /s/ Michael J. Smith March 29, 2000 - - ------------------------- Michael J. Smith, Chief Financial Officer, Treasurer and Secretary 30 31 EXHIBIT INDEX Exhibit Number Description ------- ----------- 2.1 Agreement and Plan of Merger dated October 1, 1996 between ICHOR Corporation and PDG Remediation, Inc. Incorporated by reference to the Corporation's Schedule 14C dated September 17, 1996. 3.1 Articles of Incorporation.(1) 3.2 Certificate of Designations. Incorporated by reference to the Corporation's Form 8-K dated March 12, 1998. 3.3 Certificate of Designations. Incorporated by reference to the Corporation's Form 8-K dated December 7, 1999. 3.4 Bylaws.(1) 10.1 Amended 1994 Stock Option Plan.(2) 10.2 1995 Qualified Incentive Stock Option Plan.(2) 10.3 Loan Agreement dated January 15, 1997 among Drummond Financial Corporation, the Corporation and ICHOR Services, Inc.(5) 10.4 Debt Settlement Agreement between Logan International Corp. and the Corporation dated February 20, 1998.(4) 10.5 Debt Settlement Agreement between Sutton Park International Ltd. and the Corporation dated February 20, 1998.(4) 10.6 Subscription Agreement between Constable Investments Ltd. and the Corporation dated February 26, 1998.(4) 10.7 Subscription Agreement between Conqueror Holdings Ltd. and the Corporation dated February 26, 1998.(3) 10.8 Subscription Agreement between Sutton Park International Ltd. and the Corporation dated February 26, 1998.(4) 10.9 Subscription Agreement between Zellstoff-und Papierfabrik Rosenthal GmbH and the Corporation dated February 26, 1998. (3) 10.10 Purchase Agreement between the Corporation and the majority shareholders of Nazca Holdings Ltd. dated October 17, 1998. Incorporated by reference to the Corporation's Form 8-K dated October 20, 1998. 10.11 Amendment to the Agreement between the Corporation and the majority shareholders of Nazca Holdings Ltd. dated October 17, 1998. Incorporated by reference to the Corporation's Form 8-K/A dated April 9, 1999. 31 32 10.12 Revised Purchase Agreement between the Corporation and the majority shareholders of Nazca Holdings Ltd. dated July 28, 1999. Incorporated by reference to the Corporation's Form 8-K/A dated August 12, 1999. 10.13 Debt Settlement Agreement between Drummond Financial Corporation and the Corporation dated November 30, 1999. Incorporated by reference to the Corporation's Form 8-K dated December 7, 1999. 23 Consent of Independent Auditors. 27 Article 5 - Financial Data Schedule for the year ended December 31, 1999. - - ----------------- (1) Incorporated by reference to the Corporation's Form 10-K dated January 31, 1996. (2) Incorporated by reference to the Corporation's Definitive Schedule 14A dated July 8, 1996. (3) Incorporated by reference to the Corporation's Form 10-K dated December 31, 1997. (4) Incorporated by reference to a Schedule 13D\A dated March 13, 1998. (5) Incorporated by reference to the Corporation's Form 10-K dated December 31, 1996. 32 EX-23 2 EXHIBIT 23 - CONSENT OF INDEPENDENT AUDITORS 1 - - -------------------------------------------------------------------------- PETERSON SULLIVAN P.L.L.C. 601 UNION STREET SUITE 2300 SEATTLE WA 98101 (206) 382-7777 FAX 382-7700 CERTIFIED PUBLIC ACCOUNTANTS Independent Auditors' Consent ----------------------------- We hereby consent to the incorporation by reference in the registration statements (No. 333-15831 and 333-15829) on Form S-8 of Ichor Corporation and Subsidiary of our report dated March 24, 2000, relating to the balance sheets of Ichor Corporation and Subsidiary as of December 31, 1999 and 1998, and the related statements of operations, shareholders' equity and cash flows for the years ended December 31, 1999, 1998 and 1997, which report appears in the Annual Report of Form 10-K for the year ended December 31, 1999, of Ichor Corporation and Subsidiary. /s/ Peterson Sullivan P.L.L.C. March 27, 2000 Seattle, Washington EX-27 3 EXHIBIT 27 - ARTICLE 5 FINANCIAL DATA SCHEDULE
5 This Schedule contains summary financial information extracted from the consolidated financial statements and notes included in this Form 10-K and is qualified in its entirety by reference to such financial statements. 1,000 12-MOS DEC-31-1999 JAN-01-1999 DEC-31-1999 2,262 0 56 0 0 2,318 0 0 2,681 29 0 0 6 50 2,596 2,681 0 183 0 653 0 0 192 (470) 0 (470) 0 0 0 (470) (0.14) (0.14)
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