<PAGE> 1
As filed with the Securities and Exchange Commission on March 1, 1999
Registration No. ____________
==============================================================================
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
NETWORK INVESTOR COMMUNICATIONS
--------------------------------------------
(Name of Small Business Issuer in its Charter)
Nevada 88-0367792
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9645 Gateway Drive, Suite B, Reno, Nevada 89511
--------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (888) 372-1777
--------------
Securities to be registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
N/A N/A
---- ---
Securities to be registered under Section 12(g) of the Act:
Common Stock, par value $0.001 per share
----------------------------------------
(Title of Class)
==============================================================================
<PAGE>
<PAGE> 2
NETWORK INVESTOR COMMUNICATIONS
FORM 10-SB
TABLE OF CONTENTS
PART 1 Page
Item 1. Description of Business ..................................... 3
Item 2. Management's Discussion and Analysis or Plan of Operation ... 6
Item 3. Description of Property...................................... 8
Item 4. Security Ownership of Certain Beneficial Owners
and Management.............................................. 8
Item 5. Directors, Executive Officers, Promoters
and Control Persons......................................... 9
Item 6. Executive Compensation....................................... 10
Item 7. Certain Relationships and Related Transactions............... 11
Item 8. Description of Securities.................................... 11
PART II
Item 1. Market Price of and Dividends on the Registrant's
Common Equity and Other Shareholder Matters................. 12
Item 2. Legal Proceedings............................................ 12
Item 3. Changes in and Disagreements with Accountants................ 12
Item 4. Recent Sales of Unregistered Securities...................... 12
Item 5. Indemnification of Directors and Officers.................... 13
PART F/S
Financial Statements......................................... 14
PART III
Item 1. Index to Exhibits............................................ 28
Signatures................................................... 29
<PAGE>
<PAGE> 3
PART I
Item 1. Description of Business
Corporate History
- -----------------
Network Investor Communications, a Nevada corporation (the "Company"),
was originally organized in Nevada on August 9, 1996, to engage in investor
and public relations for a corporate clientele. Between December 1996 and
February 1997, the Company sold shares of its common stock, par value $0.001
per share (the "Common Stock") to certain investors to raise capital to fund
its proposed business plan. Through the sale of the shares of Common Stock,
the Company raised $100,000 to fund initial operations.
The Company was formed on the belief that many corporations, particularly
those of relatively small size and corporations which have recently completed
initial public offerings("IPO'S") would need experienced public and investor
relation services. The Company believes that many of these corporations
initially do not have the established in-house capabilities or the funds to
devote to a full time investor and public relation's staff. These
corporations, management believes, will need the services of outside investor
and public relation services to assist in the dissemination of information and
communication with shareholders, the public and the investment community.
The Company hopes to capitalize on the large number of IPO's and startup
Hi-Tech and internet companies looking to establish a corporate profile and
recognition, not only among, investors, but with customers and potential
employees. Additionally, with the advance of technology, particularly the
internet, corporations have to be able to communicate to individual investors
who no longer rely on the traditional broker relationship for their investing
decisions. One of the Company's objective is to help corporations reach this
new investing group with accurate, update, informative information of its
clientele. The Company does not, however, provide any investment advice on
its clients to anyone.
By offering investor and public relation's services, the Company
alleviates the need for its clients to have a full time investor relation's
staff or deal with the volume of telephone and other inquires as to the
client's business and financial position. The Company acts as an intermediary
in not only disseminating information on clients but also in handling inquires
into the client's status.
The Company has initially focused on the small public corporations which
do not have the personnel or funds to establish investor and public relation's
departments. These corporations are readily identifiable and do to their
public status have an established need to communicate with and inform their
shareholders. Many of these companies are classified as "small cap" or
"micro-cap" stock which have trouble getting recognized by investors and
responding to investor inquiries. The Company assist these small corporations
by developing a corporate message and profile which it updates monthly or
quarterly as needed and disseminates press kits, public information and press
releases.
The Company is also expanding its focus to search for non-public
corporations which are trying to create a corporate identity and differentiate
themselves from competitors. Many of these corporations are in the Hi-Tech
and internet business which is becoming crowded and more difficult to attract
<PAGE>
<PAGE> 4
customers.
Operations
- ----------
Since inception, the Company has been hired by several corporations to
assist in public and investor relations. The Company through the efforts of
its president, Robert Deller, relies on trade shows and networking to attract
new clients. As the Company is relatively new and small compared to many of
its competitors, the Company has had to rely on relationships created by Mr.
Deller to bring in new clientele. Although the Company has represented several
clients since inception presently, the Company represents one corporation in
handling investor and public relations and is finalizing the extension of a
contract with another client.
The Company's investor and public relation services include preparing
press kits, handling the preparation and dissemination of press releases,
coordinating with printers the client's annual and quarterly reports, as well
as, proxy materials. The Company works as an intermediary between the
investment community and officers of the corporation often scheduling
conference calls with brokerage houses and road shows for officers and
directors of corporations to meet brokers.
The Company also helps establish a corporate image for its clients in
their community and industry. This corporate image is particularly important
in helping clients obtain work and attract qualified employees in their field.
The Company assists corporations in having articles published in trade
journals, establishing an internet site, having articles placed in local
papers, and preparing trade show materials and displays.
If the Company does not attract additional clients, it may be forced to
cease operations and to look for other business opportunities given its
current lack of funding, it may be difficult for the Company to pursue any
other business opportunities. The Company is down to two employees including
its president, Robert Deller, who has been funding the Company. Mr. Deller is
currently evaluating the probability of future success of the Company given
its current financial position. Although Mr. Deller will try to keep the
Company operating, if Mr. Deller is forced to terminate operations, the future
direction the Company would take is uncertain.
Management will attempt to keep its options open as to ways to make the
Company profitable. If the Company is forced to close its investor and public
relation's business, the Company will endeavor to seek other opportunities to
help provide shareholder value. As the Company has only limited resources, it
may be difficult to find profitable business opportunities. There can be no
assurance that the Company will be able to identify and acquire any business
opportunity which will ultimately prove to be beneficial to the Company and
its shareholders.
Competition and Markets
- -----------------------
The Company's initial focus was on "small cap" or "micro cap" companies
which tend to be relatively small in size and cannot afford to have a full
time staff of investment and public relations' personnel. Additionally, with
the number of recent IPO's and the increasing number of internet companies,
which tend to be smaller in size, entering into the public marketplace, the
Company felt there was a readily identifiable potential pool of clients. As
<PAGE> 5
the Company, through experience, revives its business plan, the Company has
expanded its marketing efforts to include non-public companies, particularly
in the high tech and internet fields, who are looking to create a distinctive
corporate image.
The marketplace for investor and public relation's companies is very
competitive and dominated by several very large companies who work with most
of the larger corporations. In addition to the large investor and public
relation firms, there are many smaller investor and public relations firms
specializing in certain industries or geographical areas.
The investor and public Company is at a competitive disadvantage to most
of the financial relation firms, as well as with many of the smaller firms.
Management of the Company is relatively new to the business and has not had
the time to develop the contacts that many of these other firms have
established. Additionally, new firms continually enter into the financial
relation's business as there are few barriers to entry. The Company relies on
the business contacts of its president, Robert Deller, for the majority of its
clientele. If the Company is to be successful, it will have to be able to
develop better ways to compete or distinguish itself from the crowded
financial relation's business field.
Government Regulation
- ---------------------
Currently, the financial relations field is not a heavily regulated
industry. Most of the regulations that apply deal with the Federal and State
Securities Laws and their effect on the timing of the dissemination of
information and the content of the information. These rules do not affect the
Company's business to any great extent. Instead the Company looks at these
rules as governing principles to follow when representing a client.
Additionally, any publications produced by financial relation's firms which
recommend certain corporations and their stock must state that the
recommending firm is paid by the corporation they are recommending.
The Securities and Exchange Commission has created rules which limit the
ability of financial relation's firms to accept stock in companies which they
represent. These rules have not affected the Company's business at it does
not rely to any great extent on the revenues from the sale of stock in
corporations it represents. The Company relies on the cash payments from its
clients.
Year 2000 Computer Problem
- --------------------------
The Year 2000, or Y2K problem concerns potential failure of certain
computer software to correctly process information because of the software's
inability to calculate dates. As the Company is service based, the Company
does not depend on inventory or the sale of goods and does not anticipate any
Y2K problems. The Company's computer system is PC based and has been updated
with the latest software. Additionally, the Company has all of its material
saved on alternative media from that of the PC's harddrives in case of a
computer problem.
Employees
- ---------
The Company has 1 employee consisting in addition to its president,
Robert Deller. (See "Directors and Executive Officers.")
<PAGE> 6
Offices
- -------
The Company's principal executive offices are located at 9645 Gateway
Drive, Suite B, Reno Nevada 89511. These offices are rented pursuant to a
three year lease expiring on July 31, 2000. The monthly lease amount is
$1,747.20 The Company believes that the above facilities are adequate for the
foreseeable needs of the Company; however, eventually as the Company expands
its employee base, it anticipates adding additional office space.
Item 2. Management's Discussion and Analysis or Plan of Operation
Overview
- --------
The Company was formed in 1996 to engage in public and investor
relations. Realizing that the Company needed operating capital to effectively
execute its proposed business plan, the Company engaged in an offering in 1997
raising $100,000. These funds have helped the Company stay in business and
attract additional clients. The Company currently receives monthly revenue
from its client of $7,000. Although the Company generates revenue, the
Company remains unprofitable and will need to increase its revenues if it is
to remain in business.
Plan of Operation
- -----------------
The Company operates in a very competitive environment often competing for
the same clients with well established and larger financial and investor
relation's firms. This competition has resulted in pressure on its revenue
stream with the Company often having to not only qualify with a potential
client from a professional and concept basis but with a competitive bid on
projects. Currently, clients are generated through personal contacts of the
Company's President, Bob Deller. By only having one person generating
clients, the Company has been slowed in its growth, often not having the
personnel to capitalize on and retain potential clients. The Company does not
anticipate that it will be able to hire any additional employees until several
more clients are retained and some of the Company's debt is paid.
Accordingly, revenue growth will be slow over the next twelve months.
The Company is service based receiving its revenue from corporate
clientele from whom the Company provides investor and public relation
services. Typically, the Company operates off of a flat fee structure with
monthly payments from its clients. The Company is also reimbursed for any
hard cost incurred in representing its clients for such items as printing and
travel cost.
Presently, the Company's expenses exceed its revenue. The Company
anticipated that it would take time to generate sufficient revenue to meet its
expenses as it was entering into a new business field; however, the client
generation has been slower than expected. Management still believes that the
client generating will accelerate along with revenue. If additional clients
cannot be attracted, the Company's future success will be in serious question,
and the Company may be forced to examine other potential business
opportunities to generate revenue or cease operations. Prior to ceasing
operations, the Company would examine potential other business opportunities.
If the Company is forced to examine other businesses, current shareholders may
not have the opportunity to vote or decide on the new business or direction of
the Company. Additionally, the future success of the Company and any other
<PAGE>
<PAGE> 7
business it may engage in would also be hindered by the Company's lack of
funding.
Liquidity and Capital Resources
- -------------------------------
At December 31, 1998, the Company had assets of $36,700 with current
liabilities of $185,783 resulting in a working capital deficit of $149,083.
The majority of the current liabilities, $115,705, is a loan from the
Company's president Robert Deller. Excluding the related party loan from Mr.
Deller, the Company has $70,076 in expenses that are due or will shortly come
due. Additionally, $46,705 of the funds loaned by Mr. Deller to the Company
are from Mr. Deller's personal credit cards which the Company has been paying
on a monthly basis.
The Company will not be able to pay its existing obligations from
anticipated current revenue unless additional clientele are added to increase
revenue. Mr. Deller has indicated that he will continue to attempt to fund
the Company but he has also indicated that his ability to continue to provide
personal financing of the Company is limited. Since the end of the Company's
fiscal year in June 30, 1998, Mr. Deller's had loaned the Company an
additional $30,063. If the Company's revenues do not improve, the Company may
have to look at either ceasing operations or potentially different business
opportunities. Because of the continued losses and lack of financing, the
Company's financial statements contain a "going concern" qualification.
Since June 30, 1998, payroll and other accrued liabilities has increased
from $23,860 to $62,076. Current revenues will not pay for all of these
accrued liabilities and the Company is seeking other loans to help defray
these immediate expenses. There can be no assurance that the Company will be
successful in finding financing to cover the current liabilities. If funding
is not obtained, the Company may not have the ability to pursue new clients or
to properly service existing clientele.
Results of Operations
- ---------------------
The Company has been unprofitable since its formation in 1996. From its
inception in August 1996 until June 30, 1997, the Company lost a total of
$52,147. During this time, the majority of the activities of the Company
focused on its organization, raising funds and commencing limited operations.
Since June 30, 1997, the Company has been more aggressive in pursuing its
business plan and soliciting clients. As a result operating expenses have
increased substantially from $89,701 in expenses through June 30, 1997, to
$259,025 in expenses for the fiscal year ended June 30, 1998. The majority of
these new expenses related to hiring employees, advertisement and travel cost
and to increased office overhead.
During the year ended June 30, 1998, revenue increased substantially over
the period from inception through June 30, 1997. Revenues through June 30,
1997, were only $37,554; however, for the year ended June 30, 1998, revenues
increased to $130,321 as the Company was able to attract new clientele. The
increase in revenues unfortunately did not keep up with the increased overhead
resulting in a loss of $132,906. As a result of this loss, all of the funds
raised in the Company's offering were used and the Company's president, Robert
Deller, was forced to keep the Company going through his personal funding of
the shortfalls.
<PAGE>
<PAGE> 8
Quarter Ended December 31, 1998
- -------------------------------
For the six months ended December 31, 1998, the Company had revenue of
$45,423 with expenses of $106,790 resulting in a loss of $68,331. Revenues
for this six month period slowed as a result of the completion of work for
several clients. The Company has not been immediately able to replace these
clients.
For the six months ended December 31, 1998, general and administrative
expenses decreased to $104,222 from $124,062 for the same period in 1997. As
a result of this decrease in general and administrative expenses the loss for
the six months was down from the $79,606 for the six months ended December 31,
1997.
The three months ended December 31, 1998 also saw a decline in revenue to
$24,113 from $29,772. This decline concerns management as they had hoped that
as the Company became more established, revenues would begin to increase
offsetting the expenses, many of which are fixed. As it will be difficult to
reduce expenses without reducing an already minimal staff, the Company will
need to arrange additional financing if it hopes to continue in business.
With the decline in revenues and the current financial situation, it may be
difficult to arrange new financing.
Item 3. Description of Property
The Company currently does not have any real property and only leases its
offices. Its offices are located at 9645 Gateway Drive, Suite A Reno, Nevada
89511. This lease runs through July 31, 2000, and is at a monthly rental
amount of $1,747. The Company believes its current office space is adequate
for current and future needs.
Item 4. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth the number of shares of the Company's
Common Stock, par value $0.001, held by each person who is believed to be the
beneficial owner of 5% or more of the 1,500,000 shares of the Company's common
stock outstanding at February 15, 1999, based on the Company's transfer
agent's list, representations and affidavits from shareholders and beneficial
shareholder lists provided by the Depository Trust and securities broker
dealers, and the names and number of shares held by each of the Company's
officers and directors and by all officers and directors as a group.
Title of Name and Address Amount and Nature of Percent
Class Of Beneficial Owner Beneficial Ownership of Class
- -------- ------------------- --------------------- --------
Principal Shareholders
- ----------------------
Common Robert R. Deller 500,000 33.33%
9645 Gateway Drive, Suite B
Reno, Nevada 89511
Common Barbara Bruce
545 McDonald Drive
Incline Village, Nevada 89451 100,000 6.67%
Common Thomas E. Hofer
P.O. Box 3431
Carefree, Arizona 85377 100,000 6.67%
<PAGE> 9
Common Jeff Holmes
P.O. Box 111207
Zephyr Cove, Nevada 89448 100,000 6.67%
Common Joe Thomas
3791 East Adonis Drive
Salt Lake City, Utah 84124 99,000 6.60%
Common Kahalil P. Thomas
8200 Horeshoe Bend Land
Las Vegas, Nevada 89113 87,500 5.83%
Officers, Directors and Nominees
- --------------------------------
Common Robert R. Deller, President
and Director ---------See Above---------
All Officers, Directors, and
Nominees as a Group (1 Person) 500,000 33.33%
- --------------------------------
Item 5. Directors, Executive Officers, Promoters and Control Persons
The names of the Company's sole executive officer and director and the
positions held by him are set forth below:
Name Position
- ---- --------
Robert R. Deller President, Secretary, Treasure and
Director
The term of office of each director is one year and until his successor
is elected at the Company's annual shareholders' meeting and is qualified,
subject to removal by the shareholders. The term of office for each officer
is for one year and until a successor is elected at the annual meeting of the
board of directors and is qualified, subject to removal by the board of
directors.
Biographical Information
- ------------------------
Set forth below is certain biographical information with respect to each
of the Company's officers and directors.
Robert R. Deller, age 42, is founded the Company in 1996 and has been its
president since inception. Prior to founding the Company, Mr. Deller was an
independent insurance agent for Country Companies Insurance were he received
the professional designation LUTCF. Mr. Deller has also been an officer and
director of USA Gold Mines, Inc. since 1991. Mr. Deller attended the
University of Alabama where he obtained a B.A. degree in 1979.
<PAGE> 10
ITEM 6. EXECUTIVE COMPENSATION
The following tables set forth certain summary information concerning the
compensation paid or accrued for each of the Company's last three completed
fiscal years to the Company's or its principal subsidiaries chief executive
officer and each of its other executive officers that received compensation in
excess of $100,000 during such period (as determined at June 30, 1998, the
end of the Company's last completed fiscal year):
SUMMARY COMPENSATION TABLE
- --------------------------
<TABLE>
<CAPTION>
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ --------
Other Restricted
Name and Annual Stock Options LTIP All other
Principal Position Year Salary Bonus($) Compensation Awards /SARs Payout Compensation
- ------------------ ---- ------ -------- ------------ ------ ------- ------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert R. Deller 1998 $18,000(1) -0- -0- -0- -0- -0- -0-
President and CEO 1997 $18,000 -0- -0- -0- -0- -0- -0-
1996 -0- -0- -0- -0- -0- -0- -0-
</TABLE>
_________________
(1) Mr. Deller's base salary is $54,000 per year. In 1998, Mr. Deller did
not take a salary for several months. The Company has indicated that when
funds are available, they will pay Mr. Deller for the salary that he was
unable to take in 1998.
Options/SAR Grants in Last Fiscal Year
- --------------------------------------
The Company has never granted options or stock appreciation rights.
Bonuses and Deferred Compensation
- ---------------------------------
None
<PAGE>
<PAGE> 11
Compensation Pursuant to Plans
- ------------------------------
The Company does not have any compensation or option plans.
Pension Table
- -------------
Not Applicable
Other Compensation
- ------------------
None
Compensation of Directors
- -------------------------
Currently the only director of the Company is Robert R. Deller who
receives no additional compensation for being a director of the Company.
Termination of Employment and Change of Control Arrangement
- -----------------------------------------------------------
There are presently nor are there anticipated any agreements regarding
change of control of the Company.
Officer and Director Remuneration
- ---------------------------------
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Robert Deller, the Company's president, has loaned the Company
approximately $115,705. These loans consist of $69,000 which is at an
interest rate of ten percent per annum and is due and payable on demand.
Additionally, Mr. Deller has allowed the Company to borrow and receive cash
advances on his personal credit cards totaling $46,705. The Corporation has
been making all payments on the funds borrowed on the credit cards.
Item 8. Description of Securities
Description of Securities
- -------------------------
General
-------
The Company is authorized to issue fifty million shares of capital stock,
par value $0.001 per share designated as Common Stock. There are 1,500,000
fully paid and non assessable shares of Common Stock currently issued and
outstanding as of February 15, 1998.
Common Stock
------------
The holders of Common Stock are entitled to one vote per share on each
matter submitted to a vote at any meeting of shareholders. Shares of Common
Stock do not carry cumulative voting rights and, therefore, a majority of the
<PAGE> 12
shares of outstanding Common Stock will be able to elect the entire board of
directors and, if they do so, minority shareholders would not be able to elect
any persons to the board of directors. The Company's bylaws provide that a
majority of the issued and outstanding shares of the Company constitutes a
quorum for shareholders' meetings, except with respect to certain matters for
which a greater percentage quorum is required by statute or the bylaws.
Shareholders of the Company have no preemptive rights to acquire
additional shares of Common Stock or other securities. The Common Stock is
not subject to redemption and carries no subscription or conversion rights.
In the event of liquidation of the Company, the shares of Common Stock are
entitled to share equally in corporate assets after satisfaction of all
liabilities.
Holders of Common Stock are entitled to receive such dividends as the
board of directors may from time to time declare out of funds legally
available for the payment of dividends. The Company seeks growth and
expansion of its business through the reinvestment of profits, if any, and
does not anticipate that it will pay dividends in the foreseeable future
PART II
Item 1. Market Price of and Dividends on the Registrant's
Common Equity and Other Shareholder Matters
The Company's Common Stock is currently not quoted or listed for trading
with any exchange or market.
Since its inception, the Company has not paid any dividends on its Common
Stock, and the Company does not anticipate that it will pay dividends in the
foreseeable future.
As of February 15, 1999, the Company had 1,500,000 shares of its Common
Stock issued and outstanding held by approximately 55 shareholders.
Item 2. Legal Proceedings
The Company is not, and has not been, involved in any legal proceedings.
Item 3. Changes in and Disagreements with Accountants
The Company has not changed, nor had any disagreements with, its
independent certified accountants.
Item 4. Recent Sales of Unregistered Securities
The Company upon formation issued 500,000 shares to Robert Deller, its
founder and president for consideration of $10,000. Subsequently, the Company
sold 1,000,000 shares in an offering under Rule 504 of Regulation D
promulgated by the Securities and Exchange Commission under the power granted
in the Securities Act of 1933, as amended. The Company filed a registration
statement on form U-7 in the State of Nevada for offers and sales made to
Nevada residents. The registration statement was declared effective on
December 6, 1996, by the Nevada Division of Securities. These sales were to
approximately 54 persons. All sales were made in 1997.
<PAGE>
<PAGE> 13
Item 5. Indemnification of Directors and Officers
The following is a brief summary of certain indemnification provisions of
the Company's certificate of incorporation and the Nevada Revised Statutes.
This summary is qualified in its entirety by reference to the text thereof.
Section 78.751 of the Nevada Revised Statutes confers on a director or
officer an absolute right to indemnification for expenses, including
attorneys' fees, actually and reasonably incurred by him to the extent he is
successful on the merits or otherwise in defense of any action, suit, or
proceeding. This section also entitles a director or officer to partial
indemnification against expenses to the extent that he has been successful in
defending any claim, issue, or matter asserted in such proceeding. The Nevada
indemnification section further permits the corporation to indemnify officers
and directors in circumstances where indemnification is not mandated by the
statute and certain statutory standards are satisfied. The Nevada statute
expressly makes indemnification contingent upon a determination that
indemnification is proper in the circumstances. Such determination must be
made by the board of directors, the shareholders, or independent legal
counsel. Nevada law also permits a corporation, in its articles of
incorporation, bylaws, or an agreement, to pay attorneys' fees and other
litigation expenses on behalf of a corporate official in advance of the final
disposition of the action upon receipt of an undertaking by or on behalf of
the corporate official to repay such expenses to the corporation if it is
ultimately determined that he is not entitled to be indemnified by the
corporation. The corporation may also purchase and maintain insurance to
provide indemnification. The Nevada statute also provides that
indemnification authorized by the statute is not exclusive of, but is in
addition to, indemnification rights granted under a corporation's articles of
incorporation, an agreement, or pursuant to a vote of shareholders or
disinterested directors.
The certificate of the Company specifically provides that no director or
officer is personally liable to the Company for damages for breach of
fiduciary duty involving certain acts. The Company's bylaws also contain a
provision that the Company will indemnify the officers and directors for any
liability occurring during the scope of their duties as an officer or
director.
It is anticipated that the Company will indemnify its officers and
directors to the full extent permitted by the above referenced statute.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers, and controlling persons of the small
business issuer pursuant to the foregoing provisions, or otherwise, the small
business issuer has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the small business issuer of expenses incurred or paid by a director, officer
or controlling person in connection with the securities being registered), the
small business issuer will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by the Company is
against public policy as expressed in the Securities Act and will be governed
by the final adjudication of such issue.
The foregoing discussion of indemnification merely summarizes certain
aspects of indemnification provisions and is limited by reference to Section
78.751 of the Nevada Revised Statues.
<PAGE> 14
PART F/S
--------
Financial Statements and Supplementary Data:
- -------------------------------------------
CONTENTS
PAGE
_ Independent Auditors' Report 15
_ Consolidated Balance Sheets, June 30, 1998
and 1997 16
_ Consolidated Statements of Operations for the
year ended June 30, 1998, and
From August 9, 1996 (inception) to June 30, 1997 17
_ Consolidated Statement of Stockholders' Equity,
from inception on August 9, 1996, through
June 30, 1998 18
_ Consolidated Statements of Cash Flows for the
year ended June 30, 1998, and
from inception on August 9, 1996, through
June 30, 1998 19
_ Notes to Consolidated Financial Statements 20
_ Unaudited Condensed Consolidated Balance, December 31,
1998 and June 30, 1998 24
_ Unaudited Condensed Consolidated Statements of
Operations for the six months ended
December 31, 1998, and December 31, 1997 25
_ Consolidated Statement of Stockholders' Equity,
for the six months ended December 31, 1998 and
August 9, 1996 (Inception) through June 30, 1998 26
_ Unaudited Condensed Consolidated Statements of
Cash Flows for the six months ended
December 31, 1998, and December 31, 1997 27
<PAGE>
<PAGE> 15
David T. Thomson P.C. Certified Public Accountant
INDEPENDENT AUDITORS' REPORT
Board of Directors and Stockholders
Network Investor Communications, Inc.
I have audited the balance sheets of Network Investor Communications, Inc. as
of June 30, 1998 and 1997 and the related statements of operations,
stockholders' equity and cash flows for the year ended June 30, 1998 and the
period from inception (August 9, 1996) through June 30, 1997. These financial
statements are the responsibility of the Company's management. My
responsibility is to express an opinion on these financial statements based on
my audits.
I conducted my audits in accordance with generally accepted auditing
standards. Those standards require that I 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. I believe that my audits provide a reasonable basis
for my opinion.
In my opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Network Investor
Communications, Inc. as of June 30, 1998 and 1997, and the results of its
operations and its cash flows for the year ended June 30, 1998 and for the
period from inception (August 9, 1996) through June 30, 1997, in conformity
with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 5 to the financial
statements, the Company has suffered recurring losses, requiring capital
infusions, and has limited working capital. These factors, and the others
discussed in Note 5, raise substantial doubt about the Company's ability to
continue as a going concern. Management's plans regarding those matters also
are described in Note 5. The financial statements do not include any
adjustments relating to the recoverability and classification of liabilities
that might be necessary in the event the Company cannot continue in existence.
/S/David T. Thomson
Salt Lake City, Utah
August 24, 1998
P.O. Box 571605 - Murray, Utah 84157 - (801) 966-9481<PAGE>
<PAGE> 16
NETWORK INVESTOR COMMUNICATION, INC.
BALANCE SHEET
ASSETS
June 30, June 30,
1998 1997
----------- -----------
CURRENT ASSETS:
Cash $ 184 $ 16,648
Accounts receivable, net of allowance for
doubtful accounts of $46,915 and $0 14,573 11,719
----------- -----------
Total Current Assets 14,757 28,367
----------- -----------
PROPERTY AND EQUIPMENT, NET 14,216 8,170
----------- -----------
OTHER ASSETS
Deposits 2,475 270
Shareholder loan 0 10,000
Organization costs, net of amortization of
$2,357 and $1,127 3,793 5,023
Customer lists, net of amortization of
$171 and $82 1,169 1,258
----------- -----------
Total Other Assets 7,437 16,551
----------- -----------
TOTAL ASSETS $ 36,410 $ 53,088
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 7,831 $ 393
Shareholder loan 85,462 0
Payroll and other accrued liabilities 23,869 541
----------- -----------
Total Current Liabilities $ 117,162 $ 934
=========== ===========
STOCKHOLDERS' EQUITY (DEFICIT):
Capital stock, $.001 par value; 50,000,000 shares
authorized; 1,500,000 shares issued and
outstanding, both years 1,500 1,500
Additional paid-in capital 102,801 102,801
Retained earnings (deficit) (185,053) (52,147)
----------- -----------
Total Stockholders' Equity (Deficit) (80,752) 52,154
----------- -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT) $ 36,410 $ 53,088
----------- -----------
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> 17
NETWORK INVESTOR COMMUNICATIONS, INC.
STATEMENTS OF OPERATIONS
For the From August 9,
Year ended 1996 (Inception)
June 30, to June 30,
1998 1997
------------- ----------------
FEE INCOME $ 130,321 $ 37,554
------------- ----------------
EXPENSES:
Selling, general and administrative 251,120 86,450
Depreciation and amortization 7,905 3,251
------------- ----------------
TOTAL OPERATING EXPENSES 259,025 89,701
------------- ----------------
Net (loss) before other items $ (128,704) $ (52,147)
OTHER INCOME (EXPENSE)
Interest expense (4,202) 0
------------- ----------------
NET (LOSS) BEFORE TAXES (132,906) (52,147)
PROVISIONS FOR INCOME TAXES 0 0
------------- ----------------
NET (LOSS) $ (132,906) $ (52,147)
============= ================
EARNINGS (LOSS) PER SHARE $ (0.09) $ (0.09)
============= ================
WEIGHTED AVERAGE SHARES OUTSTANDING 1,500,000 601,538
============= ================
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> 18
NETWORK INVESTOR COMMUNICATION, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE YEAR ENDED JUNE 30, 1998 AND
FROM AUGUST 9, 1996 (INCEPTION) THROUGH JUNE 30, 1997
<TABLE>
<CAPTION>
Additional Retained
Capital Stock Paid-in Earnings
Shares Amount Capital (Deficit) Total
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
BALANCE, August 9, 1996 0 $ 0 $ 0 $ 0 $ 0
Common stock issued for cash 500,000 500 9,500 0 10,000
Common stock issued for cash 1,000,000 1,000 99,000 0 100,000
Direct costs of stock offering 0 0 (5,699) 0 (5,699)
Net loss for the year ended
June 30, 1997 0 0 0 (52,147) (52,147)
------------ ------------ ------------ ------------ ------------
BALANCE, June 30, 1997 1,500,000 1,500 102,801 (52,147) 52,154
Net loss for the year ended
June 30, 1998 0 0 0 (132,906) (132,906)
------------ ------------ ------------ ------------ ------------
BALANCE, June 30, 1998 1,500,000 $ 1,500 $ 102,801 $ (185,053) $ (80,752)
============ ============ ============= ============ ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> 19
NETWORK INVESTOR COMMUNICATION, INC.
STATEMENTS OF CASH FLOWS
For the From August 9,
Year ended 1996 (Inception)
June 30, to June 30,
1998 1997
------------- ----------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (132,906) $ (52,147)
Adjustment to reconcile net loss to
net cash used in operating
activities:
Depreciation and amortization 7,905 3,251
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable (2,854) (11,719)
(Increase) decrease in deposits (2,205) (270)
(Increase) in customer lists 0 (1,340)
Increase in accounts payable and
accrued liabilities 30,766 934
------------- ----------------
Net cash used in operating activities (99,294) (61,291)
------------- ----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in organization costs 0 (6,150)
Purchase of property and equipment (12,632) (10,212)
------------- ----------------
Net cash used in investing activities (12,632) (16,362)
------------- ----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock,
net 0 104,301
Shareholder loan, net 95,462 (10,000)
------------- ----------------
Net cash provided by
Financing activities 95,462 94,301
------------- ----------------
NET INCREASE (DECREASE)IN CASH (16,464) 16,648
CASH AT BEGINNING OF PERIOD 16,648 0
------------- ----------------
CASH AT END OF PERIOD $ 184 $ 16,648
============= ================
SUPPLEMENTARY CASH FLOW INFORMATION:
Interest expense $ 4,202 $ 0
============= ================
Income taxes $ 0 $ 0
============= ================
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> 20
NETWORK INVESTOR COMMUNICATIONS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - THE COMPANY
Network Investor Communications, Inc. (the Company) was founded on
August 9, 1996 and is engaged in the business of providing investor relation
services to public companies. The Company's office is located in Reno, Nevada.
The Company sells its services nationally and internationally.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
Property and Equipment - Property and equipment are stated at cost, less
accumulated depreciation. Maintenance and repairs are expensed as incurred.
Depreciation is determined using the declining balance method under tax
regulations over the estimated useful lives of the assets which range from
five to thirty-one and a half years.
Intangible Assets - The costs incurred with the organization of the Company
have been capitalized and are being amortized over five years using the
straight-line method.
The costs incurred to acquired certain client lists for the Company have been
capitalized and are being amortized over fifteen years using the straight-line
method.
Earnings (Loss) Per Share - Earnings (loss) per share is based on the weighted
average of common shares outstanding during the year.
Concentrations of Credit Risk - The Company sells its services to public
companies in the U. S. and certain Foreign Countries. The Company extends
credit based on an evaluation of the customers' financial condition, generally
without requiring collateral. Exposure to losses on receivables is principally
dependent on each customers financial condition. Total revenue came from six
customers in 1998 and two customers in 1997.
Income Taxes - Income tax expense includes federal and state taxes currently
payable, if any, and deferred taxes, if any, arising from temporary
differences between income for financial reporting and income tax purposes. At
June 30, 1998, the corporation had a timing difference between income for
financial reporting and income tax purposes for bad debt expense. At June 30,
1997`, the corporation had no timing differences between income for financial
reporting and income tax purposes.
Development Stage Company - The Company was formed on August 9, 1996 and was
in the development stage through June 30, 1997. The fiscal year ended June 30,
1998 is the first year during which it is considered an operating company.
Statement of Cash Flows - The Company considers (if and when they have any)
all highly liquid investments with maturities of three months or less to be
cash equivalents. The Company had no non cash investing or financing
transactions during 1998 and 1997.
Use of Estimates - The preparations of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
<PAGE>
<PAGE> 21
NETWORK INVESTOR COMMUNICATIONS, INC.
NOTES TO FINANCIAL STATEMENTS
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 3 - PROPERTY AND EQUIPMENT
Property and equipment consist of the following:
June 30, June 30,
1998 1997
------------ ------------
Office equipment and furniture $ 5,492 $ -
Computer equipment 15,490 10,212
Leasehold improvements 1,862 -
------------ ------------
22,844 10,212
Less - accumulated depreciation (8,628) (2,042)
------------ ------------
$ 14,216 $ 8,170
============ ============
NOTE 4 - STOCKHOLDERS' EQUITY
On August 9, 1996, the Board of Directors authorized a stock issuance totaling
500,000 shares of common stock to an officer of the Company for a cash
consideration of $10,000.
During 1997, the Company sold 1,000,000 shares of its common stock at $.10 per
share for gross proceeds totaling $100,000. The related deferred offering
costs in the amount of $5,699 were offset against the gross proceeds from the
offering. Form "D" was filed with the Securities and Exchange Commission to
report the sale of the securities.
NOTE 5 - GOING CONCERN
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplates continuation of
the Company as a going concern. However the Company has sustained substantial
operating losses since its inception. In addition, the Company has used
substantial amounts of working capital in its operations. Further, at June 30,
1998, current liabilities exceed current assets by $102,405 and total
liabilities exceed total assets by $80,752.
In view of these matters, realization of a major portion of the assets in the
accompanying balance sheets are dependent upon continued operations of the
Company, which in turn is dependent upon the Company's ability to meet its
financing requirements, and the success of its future operations. Management
believes their plans will provide the corporation with the ability to continue
in existence. Management plans to continue to sell stock of the Company and
borrow funds as needed to meet operating requirements. Management believes
that as it expands its product sales, it will be able to meet cash needs.
<PAGE>
<PAGE> 22
NETWORK INVESTOR COMMUNICATIONS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 6 - INCOME TAXES
Income tax expense (benefit) consists of the following components:
1998 1997
------------ ------------
Current $ - $ -
Deferred tax benefit (7,037) -
Valuation allowance 7,037 -
------------ ------------
$ $
============ ============
For tax return purposes the Company has estimated net operating loss
carryforwards (NOL) of $136,457 and $51,583 at June 30, 1998 and 1997,
respectively. $84,874 of the NOL expires in the year 2018 and $51,583 of the
NOL expires in 2017. A valuation allowance of $36,468 and $7,896 for the years
1998 and 1997 respectively, have been established for those credits which are
not expected to be realized. The change in the NOL allowance in 1998 was
$28,572.
NOTE 7 - OPERATING LEASES
The Company leases office space in Reno, Nevada under a operating lease which
expires in July 2000. The monthly lease payment is $1,747. The Company has an
option to extend the lease for two years. The option must be exercised 30 days
before the lease ends. The new payment under the extension option is $1,922.
Minimum future rental payments under the lease until expiration is as follows:
Year Ended Amount
------------ ----------
1999 $ 20,964
2000 20,964
2001 1,747
Rental expense under facility operating leases was $19,217 for 1998.
As of June 30, 1998, the Company had certain office equipment under
operating leases with remaining periods from two to three years. At June 30,
1998, the scheduled future minimum cash rental payments under noncancelable
operating leases with initial terms of more than one year are as follows:
Year Ended Amount
------------ ----------
1999 $ 4,692
2000 4,692
2001 1,406
Lease payments expensed under the equipment operating leases was $3,286
for 1998.
<PAGE>
<PAGE> 23
NETWORK INVESTOR COMMUNICATIONS, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 8 - RELATED PARTY TRANSACTION
The President of the Company has made certain loans to the Company during the
year. The cash loans are accruing interest at an annual rate of ten percent
per annum. Additionally, the officer has allowed the Company to obtain credit
and advances against certain credit cards under his personal name. The Company
makes all payments against these credit cards and pays the related finance
charges made by the credit card companies.
The balances of the above listed items are as follows:
Cash advances $ 52,750
Credit card advances 32,712
---------
Total $ 85,462
=========
During fiscal year ended June 30, 1997, the Company owed the same officer
$10,000. The loans are unsecured.
<PAGE>
<PAGE> 24
NETWORK INVESTOR COMMUNICATION, INC.
BALANCE SHEET
DECEMBER 31, 1998 AND JUNE 30, 1998
ASSETS
December 31, June 30,
1998 1998
(Unaudited)
----------- -----------
CURRENT ASSETS:
Cash $ 5,453 $ 184
Accounts receivable, net of allowance for
doubtful accounts of $46,915 at December 31,
1998 and June 30, 1998 12,162 14,573
----------- -----------
Total Current Assets 17,615 14,757
----------- -----------
PROPERTY AND EQUIPMENT, NET 12,308 14,216
----------- -----------
OTHER ASSETS
Deposits 2,475 2,475
Organization costs, net of amortization of
$2,975 and $2,357 3,175 3,793
Customer lists, net of amortization of
$213 and $171 1,127 1,169
----------- -----------
Total Other Assets 6,777 7,437
----------- -----------
TOTAL ASSETS $ 36,700 $ 36,410
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 8,000 $ 7,831
Shareholder loan 115,705 85,462
Payroll and other accrued liabilities 62,078 23,869
----------- -----------
Total Current Liabilities $ 185,783 $ 117,162
=========== ===========
STOCKHOLDERS' EQUITY/(DEFICIT):
Capital stock, $.001 par value; 50,000,000 shares
authorized; 1,500,000 shares issued and
outstanding 1,500 1,500
Additional paid-in capital 102,801 102,801
Retained earnings (deficit) (253,384) (185,053)
----------- -----------
Total Stockholders' Equity (Deficit) (149,083) (80,752)
----------- -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIT) $ 36,700 $ 36,410
=========== ===========
<PAGE>
<PAGE> 25
NETWORK INVESTOR COMMUNICATIONS, INC.
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the For the For the For the
Six Months Six Months Three Months Three Months
Ended Ended Ended Ended
December 31, 1998 December 31, December 31,1998 December 31,
(Unaudited) 1997 (Unaudited) 1997
------------- ---------------- ------------- ----------------
<S> <C> <C> <C> <C>
SALES $ 45,423 $ 48,906 $ 24,113 $ 29,772
------------- ---------------- ------------- ----------------
EXPENSES:
General and administrative 104,222 124,062 33,703 39,711
Depreciation and amortization 2,568 3,953 1,284 1,977
------------- ---------------- ------------- ----------------
TOTAL OPERATING EXPENSES 106,790 128,015 34,987 41,688
------------- ---------------- ------------- ----------------
Net (loss) before other items (61,367) (79,109) (10,874) (11,916)
OTHER INCOME (EXPENSE)
Interest expense (6,964) (497) (5,564) (497)
------------- ---------------- ------------- ----------------
NET (LOSS) BEFORE TAXES (68,331) (79,606) (16,438) (12,413)
PROVISIONS FOR INCOME TAXES - - - -
------------- ---------------- ------------- ----------------
NET (LOSS) $ (68,331) $ (79,606) $ (16,438) $ (12,413)
------------- ---------------- ------------- ----------------
EARNINGS (LOSS) PER SHARE $ (0.05) $ (0.05) $ (0.01) $ -
============= ================ ============= ================
WEIGHTED AVERAGE SHARES OUTSTANDING 1,500,000 1,500,000 1,500,000 1,500,000
============= ================ ============= ================
</TABLE>
<PAGE>
<PAGE> 26
NETWORK INVESTOR COMMUNICATION, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY/(DEFICIT)
FOR THE SIX ENDED DECEMBER 31, 1998 AND
AUGUST 9, 1996 (INCEPTION) THROUGH JUNE 30, 1998
<TABLE>
<CAPTION>
Capital Stock Earnings
Shares Amount Deficit Total
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
BALANCE, August 9, 1996 - $ - $ - $ -
Common stock issued for cash 500,000 10,000 - 10,000
Common stock issued for cash 1,000,000 100,000 - 100,000
Direct costs of stock offering - (5,699) - (5,699)
Net loss for the year ended
June 30, 1997 - - (52,147) (52,147)
------------ ------------ ------------ ------------
BALANCE, June 30, 1997 1,500,000 104,301 (52,147) 52,154
Net loss for the year ended
June 30, 1998 - - (132,906) (132,906)
------------ ------------ ------------ ------------
BALANCE, June 30, 1998 1,500,000 104,301 (185,053) (80,752)
Net loss for the six months ended
December 31, 1998 (Unaudited) - - (68,331) (68,331)
------------ ------------ ------------ ------------
BALANCE, December 31, 1998 (Unaudited) 1,500,000 $ 104,301 $ (253,384) $ (149,083)
============ ============ ============ ============
</TABLE>
<PAGE>
<PAGE> 27
NETWORK INVESTOR COMMUNICATION, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Six For the Six For the From August 9,
Months Ended Months Ended Year ended 1996 (Inception)
December 31, December 31, June 30, to June 30,
1998(unaudited) 1997 1998 1997
--------------- --------------- --------------- --------------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (68,331) $ (79,606) $ (132,906) $ (52,147)
Adjustment to reconcile net loss to
net cash used in operating
activities:
Depreciation and amortization 2,568 3,953 7,905 3,251
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable 2,411 (29,068) (2,854) (11,719)
(Increase) decrease in deposits - (458) (2,205) (270)
(Increase) in customer lists - - - (1,340)
Increase in accounts payable and
accrued liabilities 38,378 13,863 30,766 934
--------------- --------------- --------------- --------------
Net cash used in operating activities (24,974) (91,316) (99,294) (61,291)
--------------- --------------- --------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in organization costs - - - (6,150)
Purchase of property and equipment - (12,632) (12,632) (10,212)
--------------- --------------- --------------- --------------
Net cash used in investing activities - (12,632) (12,632) (16,362)
--------------- --------------- --------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock,
net - - - 104,301
Shareholder loan, net 30,243 86,500 95,462 (10,000)
--------------- --------------- --------------- --------------
Net cash provided by
Financing activities 30,243 86,500 95,462 94,301
--------------- --------------- --------------- --------------
NET INCREASE (DECREASE)IN CASH 5,269 (17,448) (16,464) 16,648
CASH AT BEGINNING OF PERIOD 184 16,648 16,648 -
--------------- --------------- --------------- --------------
CASH AT END OF PERIOD $ 5,453 $ (800) $ 184 $ 16,648
=============== =============== =============== ==============
SUPPLEMENTARY CASH FLOW INFORMATION:
Interest expense $ 6,964 $ 497 $ 4,202 $ -
=============== =============== =============== ==============
/TABLE
<PAGE>
<PAGE> 28
PART III
--------
ITEM 1. INDEX TO EXHIBITS
- -------------------------
Copies of the following documents are included as exhibits to this Form
10-SB pursuant to item 601 of regulation S-B.
SEC
Exhibit Reference
No. No. Title of Document
- ------- --------- -----------------
1 3 Articles of Incorporation of the Company and related
Amendments
2 3 Bylaws of the Company
3 4 Specimen Stock Certificate
4 4 Article IV of the Articles of Incorporation (See Exhibit
No. 3)
5 10 Consulting Agreement with Pacific Magtron International,
Inc.
6 27 Financial Data Schedule
<PAGE>
<PAGE> 29
SIGNATURES
------------
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunder duly authorized.
NETWORK INVESTOR COMMUNICATIONS
By:/S/Robert Deller, President
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by
the undersigned in the capacities and on the dates stated.
Signature Title Date
- --------- ----- ----
/S/Robert Deller President, Director February 24, 1999
<PAGE> 1
EXHIBIT 1 ARTICLES OF INCORPORATION
OF
NETWORK INVESTOR COMMUNICATIONS, INC.
FIRST. The name of the corporation is:
NETWORK INVESTOR COMMUNICATIONS, INC.
SECOND. It's registered office in the State of Nevada is located at 649()
So. McCarran Blvd. Ste. A-5, Reno, Nevada 89509, that this Corporation may
maintain an office, or offices, in such other place within or without the
State of Nevada as may be from time to time designated by the By-Laws of said
Corporation, and that this Corporation may conduct all Corporation business of
every kind and nature, including the holding of all meetings of Directors and
Stockholders, outside the State of Nevada as well as within the State of
Nevada.
THIRD. The objects for which this Corporation is formed are: To engage in
any lawful activity, including, but not limited to the following:
(A) Shall have such rights, privileges and powers as may be
conferred upon corporations by any existing law.
(B) May at any time exercise such rights, privileges and powers,
when not inconsistent with the purposes and objects for which this corporation
is organized.
(C) Shall have power to have succession by its corporate name for
the period limited in its certificate or articles of incorporation, and when
no period is limited, perpetually, or until dissolved and its affairs wound up
according to law.
(D) Shall have the power to affect litigation in its own behalf and
interest in any court of law.
(E) Shall have power to make contracts.
(F)Shall have power to hold, purchase and convey real and personal
estate and mortgage or leased any such real and personal estate with its
franchises. The power to hold real and legality of the document.
(G) Shall have power to appoint such officers and agents as the
affairs of the corporation shall require, and to allow them suitable
compensation.
(H) Shall have power to make By-Laws not inconsistent with the
constitution or laws of the United States, or of the State of Nevada, for the
management, regulation and government of its affairs and property the transfer
of it's stock, the transaction of it's business, and the calling and holding
of meetings of it's stockholders.
(I) Shall have power to dissolve itself.
(J) Shall have power to adopt and use a common seal or stamp, and
alter the same. The use of a seal stamp or by the corporation on any corporate
documents is not necessary. The corporation may use a seal or stamp, if it
desires, but such sue or nonuse shall not in any way affect the legality of
the document.
<PAGE> 2
(K) Shall leave power to borrow money and contract debts when
necessary for the transaction of its business, or for the exercise of its
corporate rights, privileges or franchises, or for any other lawful purpose of
its incorporation; to issue bonds, promissory notes, bills of exchange,
debentures, and other obligations and evidences of indebtedness, payable at a
specified event or events, whether secured by mortgage, pledge or otherwise,
or unsecured, or for money borrowed, or in payment for property purchased or
acquired, of for any other lawful object.
(L) Shall have power to guarantee, purchase, hold, sell, assign,
transfer, mortgage, pledge or otherwise dispose of the shares of the capital
stock of, or any bonds, securities or evidences of the indebtedness created
by, any other corporation or corporations of the State of Nevada, or any other
state or government, and, while owners of such stock, bonds, securities or
evidences of indebtedness, to exercise all the rights, powers and privileges
of ownership, including the right to vote, if any
(M) Shall have power to purchase, hold, sell and transfer shares of
it's own capital stock and use therefor it's capital, capital surplus,
surplus, or other property or fund.
(N) Shall have power to conduct business, have one or more offices,
and hold, purchase mortgage and convey real and personal property in the State
of Nevada, and in any of the several states, territories, possessions and
dependencies of the United States, the District of Columbia, and foreign
countries.
(O) Shall have power to do all and everything necessary and proper
for the accomplishment of the objects enumerated in it's certificate or
articles of incorporation, or any amendment thereof, or necessary or
incidental to the protection and benefit of the corporation, and, in general
to carry on any lawful business necessary or incidental to the attainment of
the objects of the corporation, whether or not such business is similar in
nature to the objects set forth in the certificate or articles of
incorporation of the corporation, or any amendment thereof.
(P) Shall have power to make donations for the public welfare or for
charitable scientific or educational purposes.
(Q) Shall have power to enter into partnerships, general or limited,
or joint ventures in connection with any lawful activities.
FOURTH. The aggregate number of shares the corporation shall leave
authority to issue shall be FIFTY MILLION (50,000,000) shares of common stock,
par value one mil ($.001) per share, each share of common stock having equal
rights and preferences, voting privileges and preferences.
FIFTH. The governing board of this corporation shall be known as
directors and the number of directors may from time to time be increased or
decreased in such manner as shall be provided by the By-Laws of this
Corporation, providing that the member of directors shall not be reduced to
fewer than one (1).
The name and post office address of the first Board of Directors
shall be two(2) in number and listed as follows:
<PAGE> 3
Name Address
Robert R. Deller 6490 S. McCarran Blvd. Ste. A-5
Reno, Nevada 89509
Kenneth E. Bedell 4195 Longknife Rd
Reno, Nevada 89509
SIXTH. The capital stock, after the amount of the subscription pace, or
par value, has been paid in, shall not be subject to assessment to pay the
debts of the corporation.
SEVENTH. The name and post office address of the Incorporators signing
tile Articles of Incorporation is as follows:
Name Address
Robert R. Deller 6490 S. McCarran Blvd. Ste. A-5
Reno, Nevada 89509
Kenneth E. Bedell 4195 Longknife Rd
Reno, Nevada 89509
EIGHTH. The resident agent for this corporation shall be:
ROBERT R. DELLER
The address of said agent, and the registered or statutory address of this
corporation in the state of Nevada shall be:
6490 S. McCarran Blvd. Ste. A-5
Reno, Nevada 89509
NINTH. The corporation is to have perpetual existence.
TENTH. In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized:
Subject to the By-Laws, if any, adopted by the stockholders, to make,
alter or amend the By-Laws of the Corporation.
To fix the amount to be reserved as working capital over and above its
capital stock paid in; to authorize and cause to be executed, mortgages and
liens upon the real and personal property of this Corporation.
By resolution passed by a majority of the whole Board, to designate one
(1) or more committees, each committee to consist of one (1) or more of the
Directors of the Corporation, to the extent provided in the resolution, or in
the By-Laws of the Corporation, shall have and may exercise the powers of the
Board of Directors in the management of the business and affairs of the
Corporation. Such committee, or committees shall have such name, or names as
may be stated in the By-Laws of the Corporation, or as may be determined from
time to time by resolution adopted by the Board of Directors.
When and as authorized by the affirmative vote of the stockholders holding
stock entitling them to exercise at least a majority of the voting power given
at a stockholders meeting called for that purpose, or when authorized by the
written consent of the holders of at least a majority of the voting stock
<PAGE> 4
issued and outstanding, the Board of Directors shall have power and authority
at any meeting to sell, lease or exchange all of the property and assets of
the Corporation, including its goodwill and it's franchises, upon such terms
and conditions as its Board of Directors deems expedient and for the best
interests of the Corporation.
ELEVENTH. No shareholder shall be entitled as a matter of right to
subscribe for or receive additional shares of any class of stock of the
Corporation, whether now or hereafter authorized, or any bonds, debentures or
securities convertible into stock, but such additional shares of stock or
other securities convertible into stock may be issued or disposed of by the
Board of Directors to such persons and on such deems as in its discretion it
shall deem advisable.
TWELFTH. No director or officer of the Corporation shall be personally
liable to the Corporation or any of it's stockholders for damages for breach
of fiduciary duty as a director or officer involving any act or omission of
any such director or officer; provided however, that the foregoing provision
shall not eliminate or limit the liability of a director or officer ( I ) for
acts or omissions which involve intentional misconduct, fraud or a knowing
violation of law, or ( ii ) the payment of dividends in violation of Section
78.300 of the Nevada Revised Statutes. Any repeal or modification of this
Articles by the stockholders of the Corporation shall be prospective only and
shall not adversely affect any limitation on the personal liability of a
director or officer of the Corporation for acts or omissions to such repeal or
modification.
THIRTEENTH. This Corporation reserves the right to amend, alter, change or
repeal any provision contained in the Articles of Incorporation, in the manner
now or hereafter prescribed by statute, or by the Articles of Incorporation,
and all rights conferred upon stockholders herein are granted subject to this
reservation.
I, THE UNDERSIGNED, being the Incorporator herein before named for the
purpose of forming a Corporation pursuant to the General Corporation Law of
the State of Nevada, do make and file these Articles of Incorporation, hereby
declaring and certifying that the facts herein stated are true, and
accordingly have hereunto set my hand this 5th day of August, 1996.
/S/ Robert R. Deller
/S/ Kenneth E. Bedell
STATE OF NEVADA )
: ss.
COUNTY OF Washoe )
On this the 5th day of August, l996, in Reno, Nevada, before me, the
undersigned, a Notary Public in and for Washoe County, State of Nevada
personally appeared Robert R. Deller and Kenneth E. Medell, known to me to be
the person(s) whose name is subscribed to the foregoing document and
acknowledged to me that he executed the same.
[NOTARY PUBLIC-STATE OF NEVADA /S/Alexander Williams
County of Washoe ----------------------------
ALEXANDER WILLIAMS Notary Public
My appointment Expires Feb. 9, 1999]
I, Robert R. Deller, hereby accept as Resident Agent for the previously named
Corporation.
DATE: 8-5-96 /S/Robert R. Deller
<PAGE> 1
EXHIBIT 2 BYLAWS
OF
NETWORK INVESTOR COMMUNICATIONS, INC.
ARTICLE I
OFFICES
SECTION 1. PRINCIPAL OFFICE. The principal office of the Corporation shall
be located in the City of Reno, Nevada, Washoe County, State of Nevada.
SECTION 2. OTHER OFFICES. In addition to the principal office at 6490 S.
McCarran Blvd. Ste. A-5, Reno, Nevada 89509, other offices may also be
maintained at such other place or places, either within or without the State
of Nevada, as may be designated from time to time by the Board of Directors,
where any and all business of the Corporation may be transacted and where
meetings of the stockholders and of the Directors may be held with the same
effect as though done or held at said principal office.
ARTICLE II
MEETING OF THE STOCKHOLDERS
SECTION 1. ANNUAL MEETINGS. The annual meeting of the shareholder,
commencing with the year 1996, shall be held at the registered office of the
corporation, or at such other place as may be specified or fixed in the notice
of said meetings in the month of or the month preceding the due date of the
annual list of the officers and directors of the corporation at such time as
the shareholders shall decide, for the election of directors and for the
transaction of such other business as may properly come before said meetings.
SECTION 2. NOTICE OF ANNUAL MEETING. The Secretary shall mail, in the
manner provided in Section 5 of Article II of these Bylaws, or deliver a
written or printed notice of each annual meeting to each stockholder of
record, entitled to vote thereat, or may notify by telegram, at least ten and
not more than sixty (60) days before the date of such meeting
SECTION 3. PLACE OF MEETINGS. The Board of Directors may designate any
place either within or without the State of Nevada as the place of meeting for
annual meeting or for any special meeting called by the Board of Directors. A
waiver of notice signed by all stockholders may designate any place either
within or without the State of Nevada, as the places for holding of such
meeting. If no designation is made, or if a special meeting be otherwise
called, the place of meeting shall be the principal office of the Corporation
in the State of Nevada, except as otherwise provided in Section 6, Article II
of these Bylaws, entitled "Meeting of All Stockholders".
SECTION 4. SPECIAL MEETINGS. Special meetings of the stockholders shall be
held at the principal office of the Corporation or at such other place as
shall be specified or fixed in a notice hereof. Such meetings of the
stockholders may be called at any time by the President or Secretary, or by a
majority of the Board of Directors then in office, and shall be called by the
President with or without Board approval on the written request of the holders
of record of at least fifty percent (50%) of the number of shares of the
Corporation then outstanding and entitled to vote, which written request shall
state the object of such meetings
SECTION 5. NOTICE OF MEETING. Written or printed notice stating the place,
day and hour of the meeting and, in case of special meeting, the purpose for
which the meeting is called, shall be delivered not less than ten (10) nor
more than sixty (60) days before the date of the meeting, either personally or
<PAGE> 2
by mail, by or at the direction of the President or the Secretary to each
stockholder of record entitled to vote at such meeting. If mailed, such notice
shall be deemed to be delivered when deposited in the United States mail,
addressed to the stockholder at his/her address as it appears on the records
of the Corporation, with postage prepaid.
Any stockholder may, at any time, by duly signed statement in writing to
that effect, waive any statutory or other notice of any meeting, whether such
statement by signed before or after such meeting.
SECTION 6. MEETING OF ALL STOCKHOLDERS. If all the stockholders shall meet
at any time and place, either within or without the State of Nevada, and
consent to the holding of the meeting at such time and place, such meeting
shall be valid without call or notice and at such meeting any corporate action
may be taken.
SECTION 7. QUORUM. At all stockholders' meetings, the presence in person
or by proxy of the holders of a majority of the outstanding stock entitled to
vote shall be necessary to constitute a quorum for the transaction of
business, but a lesser number may adjourn to some future time not less than
seven (7) nor more than twenty-one (21) days later, and the Secretary shall
thereupon give at least three (3), days' notice by mail to each stockholders
entitled to vote who is absent from such meeting.
SECTION 8. MODE OF VOTING. At all meetings of the stockholders the voting
may be voice vote, but any qualified voter may demand a stock vote whereupon
such stock vote shall be taken by ballot, each of which shall state the name
of the stockholder voting and the number of shares voted by him/her and, if
such ballot be cast by proxy it shall also state the name of such proxy,
provided' however, that the mode of voting prescribed by statute for any
particular case shall be in such case followed.
SECTION 9. PROXIES. At any meeting of the stockholders, any stockholder
may be represented and vote by a proxy or proxies appointed by an instrument
in writing. In the event any such instrument in writing shall designate two or
more persons to act as profiles, a majority of such person present at the
meeting, or if only one shall be present, then that one shall have and may
exercise all of the powers conferred by such written instrument upon all of
the persons so designated unless the instrument shall otherwise provide. No
such proxy shall be valid Star the expiration of six (6) months from the date
of its execution, unless coupled with an interest, or unless the person
executing it specified therein the length of time for which it is to continue
in force, which in no case shall exceed seven (7) years from the date of its
execution. Subject to the above, any proxy duly executed is not revoked and
continues in hill force and effect until any instrument revoking it or duly
executed proxy bearing a later date is filed with the Secretary of Tic
Corporation. At no time shall any proxy be valid which shall be filed less
than ten (10) hours before the commencement of the meeting.
SECTION 10. VOTING LISTS. The officer or agent in charge of the transfer
books for shares of the corporation shall make, at least three (3) days before
each meeting of stockholders, a complete lid of the stockholders entitled to
vote at such meeting, arranged in alphabetical order with the number of shares
held by each, which list for a period of two (2) days prior to such meeting
shall be kept on file at the registered office of the corporation and shall be
subject to inspection by any stockholder at any time during the whole time of
the meeting. The original share ledger or transfer book, or duplicate thereof
kept in this state, shall be prima facie evidence as to who are the
<PAGE> 3
stockholders entitled to examine such list or share ledger or transfer book or
to vote at any meeting of stockholders
SECTION ll. CLOSING TRANSFER BOOKS OR FIXING OR RECORD DATE. For the
purpose of determining stockholders entitled to notice or to vote for any
meeting of stockholders, the Board of Directors of the Corporation may provide
that the stock transfer books be closed for a slated period but not to exceed
in any case sixty (60) days before such determination. If the stock transfer
books be closed for the purpose of determining stockholders entitled to notice
of It meeting of stockholders such books shall be closed for at least fifteen
( 15) days immediately preceding such meeting. In lieu of closing the stock
transfer books, the Board of Directors may fix in advance a date in any case
to be not more than sixty (60) days, not less than ten (10) days prior to the
date on which the particular action, requiring such determination of
stockholders, is to be taken. If the stock transfer books are not closed and
no record date is fixed for determination of stockholders entitled to notice
of meeting of stockholders, or stockholders entitled to receive payment of a
dividend, the date on which notice of the meeting is mailed or the date on
which the resolution of the Board of Directors declaring such dividend is
adopted, as the case may be, shall be the record of date for such
determinations of shareholders.
SECTION 12. VOTING OF SHAPES BY CERTAIN HOLDERS. Shares standing in the
name of another corporation, domestic or foreign, may be voted by such
officer, agent or proxy as the Bylaws of such corporation by prescribe, or, in
the absence of such provisions, the Board of Directors of such corporation may
determine.
Shares standing in the name of deceased person may be voted by his/her
administrator or executor, either in person or by proxy. Shares standing in
the name of the guardian, conservator or trustee they be rioted by such
fiduciary either in person or by proxy, but no guardian, conservator, or
trustee shall be entitled, as such fiduciary, to vote shares held by him
without a transfer of such shares into his/her name.
Shares standing in the name of a receiver may be voted by such receiver,
and shares held by or under the control of a receiver may be voted by such
receiver without the transfer thereof into his name if authority so to do be
contained in an appropriate order of the court at which such receiver was
appointed.
A stockholder whose shares, are pledged shall be entitled to vote such
shares until shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
Shares of its own stock belonging to this corporation shall not voted,
directly or indirectly, at any meeting and shall not be counted in determining
the total number of outstanding shares at any time, but shares of its own
stock held by it in a fiduciary capacity may be voted and shall be counted in
determining the total number of outstanding shares at any given time.
SECTION 13. INFORMAL ACTION BY STOCKHOLDERS. Any action is required to be
taken at a meeting of the stockholders or any other action which may be taken
at a meeting of the stockholders except the election of directors may be taken
without a meeting if a consent in writing setting forth the action so taken
shall be signed by all of the stockholders entitled to vote with respect to
the subject matter thereof.
<PAGE> 4
SECTION 14. VOTING OF SHARES. Each outstanding share entitled to vote
shall be entitled To one (1) vote upon each matter submitted to note at a
meeting of stockholders.
ARTICLE III
DIRECTORS
SECTION 1. GENERAL POWERS. The Board of Directors shall have the control
and general management of the affairs and business of the Corporation. Such
directors shall in all cases act as Board, regularly convened, by a majority,
and they may adopt such rules and regulations for the conduct of their
meetings and the management of the Corporation, as they may deem proper, not
inconsistent vim these Bylaws, Articles of Incorporation and the laws of the
State of Nevada. The Board of Directors shall further have the right to
delegate certain other powers to the Executive Committee as provided In these
Bylaws.
SECTION 2. NUMBER OF DIRECTORS. The affairs and business of this
Corporation shall be managed by a Board of Director consisting of not less
than one (1) or more than seven (7), until changed by amendment to these
Bylaws adopted by the shareholders amending this Section 2, Article III, and
except as authorized by the Nevada Revised Statutes, there shall in no event
be less than one (1) Director.
SECTION 3. ELECTION. The Directors of the Corporation shall be elected at
the annual meeting of the stockholders except as hereinafter otherwise
provided for the filling of vacancies. Each Director shall hold office for a
term of one (1) year and until his successor shall have duly chosen and shall
have qualified, or until his death, or until he shall resign or shall have
been removed in the manner hereinafter provided.
SECTION 4. VACANCIES IN THE BOARD. Any vacancy in the Board of Directors
occurring during the year through death, resignation, removal or other cause,
including vacancies caused by an increase in the number of directors shall be
filled for the unexpired portion they constitute a quorum, at any special
meeting of the Board calls for that purpose, or at any regular meeting
thereof; provided, however, that in the event the remaining directors do not
represent a quorum of the number set forth in Section 2 hereof, a majority of
such remaining directors may elect directors to fill any vacancies.
SECTION 5. DIRECTORS MEETINGS. Annual meeting of the Board of Directors
shall be held each year immediately following the annual meeting of the
stockholders. Other regular meetings of the Board of Directors shall form time
to time by resolution be prescribed. No further notice of such annual or
regular meeting of the Board of Directors need be given.
SECTION 6. SPECIAL MEETINGS. Special meetings of the Board of Director may
be called by or at the request of the President or any Director. The person or
persons authorized to call meetings of the Board of Directors may fix any
place, either within or without the State of Nevada, as the place far holding
any special meeting of the Board of Directors called by them.
SECTION 7, NOTICE. Notice of any special meeting shall be given at least
twenty-four (24) hours previous thereto by written notice if personally
delivered, or five (5) days precious thereto if mailed to each Director at his
business address, or by, telegram. If mailed, such notice shall be deemed to
have been delivered when deposited in the United States mail so addressed with
<PAGE> 5
postage thereon prepaid. If notice is given by telegram, such notice shall be
deemed to be delivered when the telegram is delivered to the telegraph
company. Any Director may waive notice of any meeting. The attendance of a
Director at any meeting shall constitute a waive of notice of such meeting,
except where a Director attends a meeting for the express purpose of objecting
to the transaction of any business because the meeting is not lawfully called
or convened.
SECTION 8. CHAIRMAN. At all meetings of the Board of Directors, the
President shall serve as Chairman, or in the absence of the President. the
Directors present shall choose by majority vote a Director to preside as
Chairman.
SECTION 9. QUORUM AND MANNER OF ACTING. A majority of Directors, whose
number is designated in Section 2 herein, shall constitute a quorum for the
transaction of business at any meeting and the act of a majority of the
Directors present at any meeting at which a quorum is present shall be the act
of the Board of Directors. In the absence of a quorum, the majority of the
Directors present may adjourn any meeting from time to time until a quorum be
had. Notice of any adjourned meeting need not be given. The Directors shall
act only as a Board and the individual Directors shall leave no power as such.
SECTION 10. REMOVAL OF DIRECTORS. Any one or more of the Directors may be
removed either with or without cause at any time try the vote or written
consent of the stockholders representing not less than two-thirds (2/3) of the
issued and outstanding capital stock entitled to voting power.
SECTION 11. VOTING. At all meetings of the Board of Directors, each
Director is to have one (1) vote, irrespective of the number of shares of
stock that he may hold.
SECTION 12. COMPENSATION. By resolution of the Board of Directors, the
Directors may be paid their expenses, if any of attendance of each meeting of
the Board, and may be paid a fixed sum for attendance at meetings or a stated
salary of Directors. No such payment shall preclude any Director from serving
the Corporation in any other capacity and receiving compensation therefor.
SECTION 13. PRESUMPTION OF ASSENT. A Director of the Corporation who is
present at a seeing of the Board of Directors at which action on any corporate
matter is taken, shall be conclusively presumed to have assented to the action
unless his/her dissent shall be entered in the minutes of the meeting or
unless he/she shall file his/her written dissent to such action with the
person acting as the Secretary of the meeting before the adjournment thereof
or shall Ale forward such dissent by certified or registered mail to the
Secretary of the Corporation immediately after the adjournment of the meeting.
Such right to dissent shall not apply to a Director who voted in favor of such
action.
ARTICLE IV
EXECUTIVE COMMITTEE
SECTION 1. NUMBER AND ELECTION. The Board of Directors may, in its'
discretion, appoint from it's membership an Executive Committee of one (1) or
more Directors, each to serve at the pleasure of the Board of Directors.
SECTION 2. AUTHORITY. The Executive Committee is authorized to take any
action which the Board of Directors could take, except that the Executive
Committee shall not have the power either to issue or authorize the issuance
<PAGE> 6
of shares of capital stock, to amend the Bylaws, or a resolution of the Board
of Directors. Any authorized action taken by the Executive Committee shall be
as effective as if it had been taken lay the Fill Board of Directors.
SECTION 3. REGULAR MEETINGS. Regular meetings of the Executive Committee
may be held within or without the State of Nevada et such time and place as
the Executive Committee may provide from time to time.
SECTION 4. SPECIAL MEETINGS. Special meetings of the Executive Committee
may be called by or at the request of the President or any member of the
Executive Committee.
SECTION 5. NOTICE. Notice of any special meeting shall be given at least
one (1) day previous thereto by written notice, telephone, telegram or in
person. Neither the business to be transacted, nor the purpose of a regular or
special meeting of the Executive Committee need be specified in the notice of
waiver of notice of such meeting. A member may waive notice of any meeting of
the Executive Committee. The attendance of a member at any meeting shall
constitute a waiver of notice of such meeting, concept where a member attends
a meeting for the express purpose of objecting to the transaction of arm
business because the meeting is not lawfully called or converted.
SECTION 6. QUORUM A majority of the members of the Executive Committee
shall constitute a quorum fur the transaction of business at any meeting of
the Executive Committee; provided that if fewer than a majority of the members
are present at said meeting a majority of the members present may adjourn the
meeting from time to time without further notice.
SECTION 7. MANNER OF ACTING. The act of the majority of the members
present at a meeting at which a quorum is present shall be the act of the
Executive Committee, and said Committee shall keep regular minutes of it's
proceedings which shall at all times be open for inspection by the Board of
Directors.
SECTION 8. PRESUMPTION OF ASSENT. A member of the Executive Committee who
is present at a meeting of the Executive Committee at which action on any
corporate matter is taken, shall conclusively presumed to have assented to the
action taken unless hi/her dissent shall be entered in the minutes of the
meeting or unless he/she shall file his written dissent to such action with
the person acting as Secretary of the meeting before the adjournment thereof,
or shall forward such dissent by certified or registered mail to the Secretary
of the Corporation immediately after the adjournment of the meeting. Such
right to dissent shall not apply to a member of the Executive Committee who
voted in favor of such action.
ARTICLE V
OFFICERS
SECTION 1. NUMBER. The officers of the Corporation shall be a President,
Vice President, a Treasurer and a Secretary and such other or subordinate
officers as the Board of Directors may from time to time elect. One (1) person
may hold the office and perform the duties of one or more of said officers. No
officer need to a member of the Board of Directors.
SECTION 2. ELECTION, TERM OF OFFICE, QUALIFICATIONS. The officers of the
Corporation shall be chosen by the Board of Directors and they shall be
elected annually at the meeting of the Board of Directors held immediately
after each annual meeting of the stockholders except as hereinafter otherwise
<PAGE> 7
provided for filling vacancies. Each officer shall hold his/her office until
his/her successor has been duly chosen and has qualified, or until his/her
death, or until he/she resigns or has been removed in the manner hereinafter
provided.
SECTION 3. REMOVALS. Any officer or agent elected or appointed by the
Board of Directors may be removed by the Board of Directors at any time
whenever in its judgment the best interest of the Corporation would be served
thereby, and such removal shall be without prejudice to the contract rights.
if any, or the perfect so removed.
SECTION 4. VACANCIES. All vacancies in any of office shall he filled by
the Board of Directors without undue delay, at any regular meetings or at a
meeting specially called for that purpose.
SECTION 5. PRESIDENT. The President shall be the Chief Executive Officer
of the Corporation and shall have general supervision over the business of the
Corporation and over its several officers, subject, however, to the control of
the Board of Directors. He/she may sign, with the Treasurer or with the
Secretary or any other proper officer of the Corporation thereunto authorized
by the Board of Directors, certificates for shares of the capital stock of the
Corporation; may sign and execute in the name of the Corporation deeds,
mortgages, bonds, contracts or other instruments authorized by the Board of
Directors, except in cases where signing and execution thereof shall be
expressly delegated by the Board of Directors or by these Bylaws to some other
officer or agent of the Corporation; and in general shall perform all duties
incident to the duties of the President, and such other duties as from time to
time may be assigned to his/her by the Board of Directors.
SECTION 6. VICE PRESIDENT. The Vice President shall in the absence or
incapacity of the President, or as ordered by the Board of Directors, perform
the duties of the President, or such other duties or functions as may be given
to him by the Board of Directors from time to time.
SECTION 7. TREASURER. The Treasurer shall have the care and custody of all
the funds and securities of the Corporation and deposit the same in the name
of the Corporation in such bank or trust company as the Board of Directors may
designate; he may sign or countersign all checks, drafts and orders for the
payment of money and may pay out and dispose of same under the direction of
the Board of Directors and may sign or countersign all notes or other
obligations of indebtedness of the Corporation; he/she may sign with the
President or Vice President, certificates for shares of stock of the
Corporation, he/she shall at all reasonable times exhibit the books and
accounts to any director or stockholder of the Corporation under application
at the office of the Company during business hours; and he/she shall, in
general, perform all duties as from time to time may be assigned to his/her by
the President or by the Board of Directors. The Board of Directors may at its
discretion require that each officer authorized to disburse the funds of the
Corporation be bonded in such amount as it may deem adequate.
SECTION 8. SECRETARY. The Secretary shall keep the minutes of the meetings
of the Board of Directors and also the minutes of the meetings of the
stockholders; he/she shall attend to the giving and serving of all notices of
the Corporation and shall affix the seal of Corporation to all certificates of
stock, when signed and countersigned by the duly authorized officers; he/she
may sign certificates for shares of stock of the Corporation; he/she may sign
or countersign all checks, drafts and orders for the payment of moneys: he/she
shall have charge of the certificate book and such other books and papers as
<PAGE> 8
the Board may direct; he/she shall keep a stock book containing the names
alphabetically arranged, of all persons who are stockholders of the
Corporation, showing their places of residence, the number of shares held by
them respectively, the time when they respectively became the owners thereof,
and the amount paid thereof, and he/she shall in general, perform all duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to him/her by the President or by the Board of Directors.
SECTION 9. OTHER OFFICERS. The Board of directors may authorize and
empower other persons or other officers appointed by it to perform the duties
and functions of the officers specifically designated above by special
resolution in each case.
SECTION 10. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES. The Assistant
Treasurers shall respectively, as may be required by the Board of Directors,
give bonds for she faithful discharge of their duties in such sums and with
such sureties as the Board of Directors shall determine. The Assistant
Secretaries as thereunto authorized by the Board of Directors may sign with
the President or Vice President certificates for shares of the capital stock
of the Corporation, issued of which shall have been authorized by resolution
of the Board of Directors. The Assistant Treasurers and Assistant Secretaries
shall, in general, perform such duties as may be assigned to them by the
Treasurer or the Secretary respectively, or by the President or by the Board
of Directors.
ARTICLE VI
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Except as hereinafter stated otherwise, the Corporation shall indemnify
all of its' officers and directors, past, present and future, against any and
all expenses incurred by them, and each of them including but not limited to
legal fees, judgments and penalties which may be incurred, rendered or levied
in any legal action brought against any or all of them for or on account of
any act or omission alleged to have been committed while acting within the
scope of their duties as officers or directors of this Corporation.
ARTICLE VII
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. CONTRACTS. The Board of Directors may authorize any officer or
officers, agent or agents to enter into any contract or execute and deliver
any instrument in the name of and on behalf of the Corporation, and such
authority may be general or confined to specific instances.
SECTION 2. LOANS. No loans shall be contracts on behalf of the Corporation
and no evidence of indebtedness shall be issued in its name unless authorized
by the Board of Directors or approved by loan committee appointed by the Board
of Directors and charged with the duly of supervising investments. Such
authority may be general or confined to specific instances.
SECTION 3. CHECKS, DRAFTS, ETC. A check, drafts or other orders for
payment of money, notes or other evidences of indebtedness issued in the name
of the Corporation shall be signed by such officer or officers, agent or
agents of the Corporation and in such manner as shall from time to time be
determined by resolutions of the Board of Directors.
SECTION 4. DEPOSITS. All funds of the Corporation not otherwise employed
shall be deposited from time to time to the credit of the Corporation in such
<PAGE> 9
banks, trust companies or other depositories as the Board of Directors may
select.
ARTICLE VIII
CAPITAL STOCK
SECTION 1. CERTIFICATE FOR SHARES. Certificates for shares of stocks of
the Corporation shall be in such form as shall be approved by the
incorporators or by the Board of Directors. The certificates shall be numbered
in the order or their issue, shall be signed by the President or Vice
President and by the Secretary or the Treasurer, or by such other person or
officer as may be designed by the Board of Directors; and the seal of the
Corporation shall be affixed thereto, which said signatures of the duly
designated officers and of the seal of the Corporation. Every certificate
authenticated by a facsimile of such signatures and seal must be countersigned
by a Transfer Agent to be appointed by the Board of Director, before issuance.
SECTION 2. TRANSFER OF STOCK. Shares of the stock of the Corporation may
be transferred by the delivery of the certificate accompanied either by an
assignment in writing on the back of the certificate or by written power of
attorney to sell, assign, and transfer the same on the books of the
Corporation, signed by the person appearing by the certificate to the owner of
the shares represented thereby, together with all necessary federal and state
transfer tax stamps affixed and shall be transferable on the books of the
Corporation upon surrender thereof so signed or endorsed. The person
registered on the books of the Corporation as the owner of any shares of stock
shall be entitled to all rights of ownership with respect to such shares.
SECTION 3. REGULATIONS. The Board of Directors may make such rules and
regulations as it may deem expedient not inconsistent with the Bylaws or with
the Articles of Incorporation, concerning the issue, transfer and registration
of the certificates for shares of stock of the Corporation. It may appoint a
transfer agent or registrar of transfers, or both, and it may require all
certificates to bear the signature of either or both.
SECTION 4. LOST CERTIFICATES. The Board of Directors may direct a new
certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the Corporation alleged to have been lost
or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate of stock to be lost or destroyed. When authorizing
such issue of a new certificate or certificates, The Board of Director may, in
its discretion and as a condition precedent to the issue thereof, require the
owner of such lost or destroyed certificate or certificates, or his/her legal
representative, to advertise the same in such manner as it shall require
and/or give the Corporation a bond in such sum as it may direct as indemnity
against any claim that may be made against the Corporation with respect to the
certificate alleged to have been lost or destroyed.
ARTICLE IX
DIVIDENDS
SECTION 1. The Corporation shall be entitled to treat the holder of any
share or shares of stock as the holder in fact thereof and, accordingly, shall
not be bound to recognize any equitable or other claim to or interest in such
shares on the part of any other person, whether or not it shall have express
or other notice thereof, except as expressly provided by the laws of Nevada.
<PAGE> 10
SECTION 2. Dividends on the capital stock of the Corporation, subject to
the provisions of the Articles of Incorporation, if any, may be declared by
the Board of Directors at any regular or special meeting, pursuant to law.
SECTION 3. The Board of Directors may close the transfer books in its
discretion for a period not exceeding fifteen (15) days preceding the date
fixed for holding any meeting, annual or special of the stockholders, or the
day appointed for the payment of a dividend.
SECTION 4. Before payment of any dividend or making any distribution of
profits, there may be set aside out of funds of the Corporation available for
dividends, such sum or sums as the Directors may from time to time, in their
absolute discretion think proper as a reserve fund to meet contingencies, or
for equalizing dividends, or for repairing or maintaining any property of the
Corporation, or for any such other purpose as the Directors shall think
conducive to the interest of the Corporation, and the Directors may modify or
abolish any such reserve in the manner in which it was created.
ARTICLE X
SEAL
The Board of Directors shall provide a Corporate Seal which shall be in
the form of a circle and shall bear the full name of the Corporation, the year
of its' incorporation arm the wants "Corporate Seal, State of Nevada".
ARTICLE XI
FISCAL YEAR
The fiscal year of the Corporation shall end on the 31st day of December
of each year.
ARTICLE XII
WAIVER OF NOTICE
Whenever any notice whatever is required to be given under the provisions
of these Bylaws, or under the laws of the State of Nevada, or under the
provisions of the Articles of Incorporation, a waiver in writing signed by the
person or persons entitled to such notice. whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.
ARTICLE XIII
AMENDMENTS
These Bylaws may be altered, amended or repealed and new Bylaws may be
adopted at any regular or special meeting of the stockholders by a vote of the
stockholders owning a majority of the shares and entitled to note thereat.
These Bylaws may also be altered, amended or repealed and new Bylaws may be
adopted at any regular or special meeting of the Board of Directors of the
Corporation (if notice of such alteration or repeal be contained In the notice
of such special meeting) by a majority vote of the Directors present at the
meeting at which a quorum is present, but any such amendment shall not be
inconsistent with or contrary to the provision of any amendment adopted by the
stockholders.
KNOW ALL MEN BY THESE PRESENTS that the undersigned, being the Secretary
of NETWORK INVESTOR COMMUNICATIONS, INC., a Nevada corporation hereby
acknowledges that the above and foregoing Bylaws were duly adopted as the
Bylaws of said Corporation on August 9TH, 1996.
<PAGE> 11
IN WITNESS WHEREOF, I hereunto subscribe my name this 9th day of August
1996.
/S/ Robert R. Deller, President/Director
/S/ Kenneth E. Bedell, Sec/Treas/Director
<PAGE>
Exhibit 3 - SPECIMEN STOCK CERTIFICATE
INCORPORATED UNDER THE LAWS OF THE STATE OF NEVADA August 9th, 1996
- --SPECIMEN---
NETWORK INVESTOR COMMUNICATIONS, INC.
Common Stock 50,000,000 .001 Par Value
CUSIP NO. 64121 C
This Certifies that ----------SPECIMEN-------------- is the registered holder
of --------------------VOID-------------------- Shares transferable only on
the books of the Corporation in person or by Attorney upon surrender of this
Certificate properly endorsed.
In Witness Whereof, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its Corporate seal to be hereto
affixed,
this ----- day of ----------- A.D. 19xx.
/s/---------------------- [Corporate Seal] /s/-------------------------
Secretary President
<PAGE> 1
EXHIBIT 5 CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT (this "Agreement") is entered into as of the 16TH
day of July, 1998, by and between Pacific Magtron, Inc. (the "Company"), and
Network Investor Communications Inc., a Nevada corporation ("Consultant").
Premises
a) Consultant has expertise and knowledge regarding media and public
relations.
b) The Company has need for the services of the Consultant in assisting in
the preparation of press releases, shareholder information and investor
relations.
Agreement
NOW, THEREFORE, for and in consideration of the mutual promises and covenants
hereinafter set forth, the benefits to the parties to be derived therefrom and
other good and valuable consideration the receipt and adequacy of which is
hereby acknowledged, it is agreed as follows:
1. Services. The Company hereby retains the Consultant and Consultant
hereby agrees to serve the Company as an independent consultant providing
advice and services to the Company in connection with:
a) Introduce company to retail brokerage firms, institutional investors,
analysts, and individual investors;
b) Working with management in developing strategies to add value to Company;
c) Creating an investor corporate profile, updated periodically (as needed);
d) Developing an investor kit to disseminate public information to trade
publications, newspapers, magazines and potential investment entities;
e) Producing and oversee fulfillment of investor requests and/or inquires;
f) Disseminating news and press releases over Business Wire or other wire
service; and
g) Assisting in public and media relationships; including media planning and
placement, message development, and preparation, timing and placement of press
releases.
Consultant agrees to provide such services to the Company as the Company may
from time to time reasonably request, including, without limitation, advice
and services with respect to those matters as to which it has special
competence by reason of its expertise. Consultant shall make its staff
available during reasonable business hours to perform services requested by
the Company that fall within the scope of this Agreement and Consultant's
expertise. Additionally, Consultant shall provide monthly reports to the
Company outlining its activities on behalf of the Company for the prior month.
2. Term. This Agreement shall remain in full force and effect for six (6)
months after the date hereof. The Agreement may be renewed for six (6)
additional months upon the mutual written consent of the parties. Upon
termination of this Agreement, the Company shall have no further obligations
<PAGE> 2
to Consultants, including the payment of any further monthly obligations.
Either party can terminate this Agreement, before the end of six (6) months,
provided that a written 30-day notice is given.
3. Compensation. The Company shall pay, and Consultant shall accept, a fee
structure as follows: $3,000 for first month, $4,000 for second month, $5,000
for third month, $5,000 for fourth month, $6,000 for fifth month, and $7,000
for sixth month, payable on the sixteenth of each month in advance.
4. Stock Compensation. It is hereby understood that any Stock Options to the
Consultant will be negotiated prior to Secondary Offering.
5. Reimbursement for Costs. The Company shall pay all reasonable and
necessary expenses, within the Company's normal expense guidelines, incurred
by Consultant in the course of providing advice and services to the Company
under the terms of this Agreement. Expenses also include business travel
while on business at the request of and in the service of the Company.
Consultant shall obtain written authorization from an executive officer of the
Company before committing to any such business expenditure in excess of five
hundred dollars ($500). Consultant shall provide the Company with all
receipts and/or other documentation concerning such business expenses. The
Company on receipt of documentation acceptable to it; including a statement
setting forth the purpose of such expenses, persons contacted and the
expectations or results of such conferences or contacts; shall pay such
expenses within thirty (30) days of the receipt of such documentation.
6. Independent Contractor. Consultant is retained under the terms of this
Agreement as an independent contractor and nothing herein shall be construed
as creating an employer/employee relationship, partnership or joint venture
between the parties. Consultant shall be solely liable for the payment of any
taxes imposed or arising out of the payment of compensation to it by the
Company set forth in this Agreement including taxes imposed by Internal
Revenue Code Section 3508; 6153 and section 1401 through 1403. The Company
agrees to the following rights of Consultant consistent with an independent
contractor relationship;
a) Consultant has the right to perform services for others during the term of
this Agreement;
b) Consultant will furnish all equipment and materials used to provide the
services required by this Agreement;
c) Consultant has the right to hire assistants as subcontractors, or to use
its employees to provide the services required by this Agreement, provided
that the Company is not liable for resulting cost; and
d) Neither Consultant nor its employees or agents shall be required to devote
full time to performing the services required by this Agreement.
7. Authority to Act. The Consultant shall not have the authority to act on
behalf of the Company or to enter into agreements on behalf of the Company.
8. Working Facilities. The Company shall provide to Consultant at the
Company's principal executive offices suitable office space and facilities for
use by Consultant when working on matters for the Company.
9. Nondisclosure of Information. Consultant agrees that during the term of
this Agreement, Consultant will not, nor will it allow its employees or agents
<PAGE> 3
to directly or indirectly, disclose to any person not authorized by the
Company to receive or use such information, any of the Company's confidential
or proprietary data, information, or techniques, or give any person not
authorized by the Company to receive it, any information that is not generally
known to anyone other than the Company or that is designated by the Company as
"limited," "private," "confidential," or otherwise marked to indicate its
confidential nature.
10. Assignment. The Consultant may not assign the obligations set forth
herein.
11. Entire Agreement. This Agreement supersedes and supplants all prior
agreements between the parties. This Agreement is the only agreement or
understanding between the parties hereto with respect to the advice and
services to be provided by Consultant to the Company. All negotiations,
commitment, and understandings of both parties have been incorporated herein.
This Agreement cannot be modified except by a written document signed by both
parties to this Agreement.
12. Governing Law. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California and venue shall be in the
County of Santa Clara, State of California.
13. Attorney's Fees. In the event that either party hereunder institutes any
legal proceedings in connection with its rights or obligations under this
Agreement, the prevailing party in such proceeding shall be entitled to
recover from the other party, all costs incurred in connection with such
proceeding, including reasonable attorneys' fees and costs.
14. Notices. Any notices or other communication required or permitted
hereunder shall be sufficiently given if personally delivered, if sent by
facsimile or telecopy transmission or other electronic communications
confirmed by registered or certified mail, postage prepaid, or if sent by
prepaid overnight courier addressed as follows:
If to Network Investor Communications Inc., Consultant, to:
Robert R. Deller, President
Network Investor Communications Inc.
9645 Gateway Drive, Suite B
Reno, Nevada 89511
Fax: (702) 852-9199
If to the Company, to:
Ted Li, CEO/President
Pacific Magtron, Inc.
1600 California Circle
Milpitas, CA 95035
Fax: (408) 956-8488
15. Severability. If, and to the extent that, any court of competent
jurisdiction holds any provision of this Agreement to be invalid or
unenforceable, such holding shall in no way affect the validity of the
remainder of this Agreement.
16. Waiver. No failure by any party to insist on the strict performance of
any convenient, duty, agreement, or condition of this Agreement, or to
<PAGE> 4
exercise any right or remedy consequent on a breach thereof, shall constitute
a waiver of any such breach or any other covenant, agreement, term, or
condition.
17. Confidential Nature. This Agreement is confidential in nature and,
accordingly, neither the Consultant nor the Company or their officers,
directors, employees and agents shall disclose its terms or conditions to any
other parties unless required to do so pursuant to an order of a court or
administrative body having proper jurisdiction over the parties and this
Agreement or pursuant to the requirements of the Securities Act of 1933, as
amended or the Exchange Act of 1934, as amended or any rule or regulation
promulgated thereunder.
PACIFIC MAGTRON, INC.
By:/S/Ted Li,CEO/President
NETWORK INVESTOR COMMUNICATIONS INC.
By:/S/Robert R. Deller, President
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001034777
<NAME> NETWORK INVESTOR COMMUNICATIONS,INC.
<S> <C> <C> <C>
<PERIOD-TYPE> 6-MOS YEAR YEAR
<FISCAL-YEAR-END> JUN-30-1999 JUN-30-1998 JUN-30-1997
<PERIOD-END> DEC-31-1998 JUN-30-1998 JUN-30-1997
<CASH> 5,453 184 16,648
<SECURITIES> 0 0 0
<RECEIVABLES> 12,162 14,573 11,719
<ALLOWANCES> 0 0 0
<INVENTORY> 0 0 0
<CURRENT-ASSETS> 17,615 14,757 28,367
<PP&E> 12,208 14,216 8,170
<DEPRECIATION> 0 0 0
<TOTAL-ASSETS> 36,700 36,410 53,088
<CURRENT-LIABILITIES> 185,783 117,162 934
<BONDS> 0 0 0
0 0 0
0 0 0
<COMMON> 104,301 104,301 104,301
<OTHER-SE> (253,384) (185,053) (52,147)
<TOTAL-LIABILITY-AND-EQUITY> 36,700 36,410 53,088
<SALES> 45,423 130,321 37,554
<TOTAL-REVENUES> 45,423 130,321 37,554
<CGS> 0 0 0
<TOTAL-COSTS> 106,790 259,025 89,701
<OTHER-EXPENSES> 0 0 0
<LOSS-PROVISION> 0 0 0
<INTEREST-EXPENSE> 6,964 4,202 0
<INCOME-PRETAX> (68,331) (132,906) (52,147)
<INCOME-TAX> 0 0 0
<INCOME-CONTINUING> 0 0 0
<DISCONTINUED> 0 0 0
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> (68,331) (132,906) (52,147)
<EPS-PRIMARY> (0.05) (0.09) (0.09)
<EPS-DILUTED> (0.05) (0.09) (0.09)
</TABLE>
