U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-KSB
[X] Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the fiscal year ended December 31, 1999 Commission File No. 333-83351
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to .
BRONZE MARKETING, INC.
(Name of small business issuer in its charter)
Nevada 87-0578370
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
426 South 1000 East, #704, Salt Lake City, Utah 84102
(Address of principal executive offices) (zip code)
Issuer's telephone number, including area code: (801) 537-1257
Securities registered under Section 12(b) of the Exchange Act: None
Securities registered under Section 12(g) of the Act: None
Check whether the Issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the Issuer was required
to file such reports) and (2) has been subject to such filing requirements for
the past 90 days. Yes X No
Check if no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is contained in this form, and no disclosure will be contained,
to the best of the Issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. (Not applicable) [ ]
The Issuer's revenues for its most recent fiscal year. $ 0.00
As of April 5, 2000, the aggregate market value of voting stock held by
non-affiliates was approximately $113,000.
The number of shares outstanding of the Issuer's common stock at December 31,
1999: 1,050,000
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS
(A) BUSINESS DEVELOPMENT.
Bronze Marketing, Inc. was recently incorporated under the laws of the
State of Nevada on May 1, 1997. In connection with its organization, the
founders contributed $5,400 cash to initially capitalize Bronze Marketing in
exchange for 900,000 shares of common stock.
On May 22, 1997, Bronze Marketing commenced a public offering of up to
100,000 shares of its common stock, in reliance upon Rule 504 of Regulation D,
promulgated by the U.S. Securities & Exchange Commission under the Securities
Act of 1933. The offering closed in July, 1997. Bronze Marketing sold
100,000 shares of common stock, at $.35 per share, and raised gross proceeds
of $35,000.
The Company then registered a public offering of its securities. Bronze
Marketing declared a distribution of 1,000,000 common stock purchase warrants
to shareholders of record as of October 27, 1999. The Company filed with the
Securities and Exchange Commission a registration statement on Form SB-2,
Commission File No. 333-83351, which became effective October 27, 1999.
Pursuant thereto the Company then distributed 1,000,000 warrants. The
warrants are exercisable at $1.00 per share, on or before June 30, 2002.
During December 1999, the Company issued 50,000 shares of its previously
authorized, but unissued common stock. Total proceeds from the sale of stock
amounted to $17,500 (or $.35 per share.) This increased the total issued and
outstanding common stock to 1,050,000 shares.
(B) BUSINESS OF COMPANY.
Bronze Marketing was formed to raise capital from public offerings of
its securities, and use the capital or net proceeds from the offering to
provide inventory financing to facilitate the marketing and sale of bronze
sculptures and other artwork created by Michael Hamby, dba Michael Hamby
Studios. Michael Hamby is the brother of the President of Bronze Marketing,
Heather Hamby. Mr. Hamby is a freelance artist who has been engaged in
business for the past several years creating, producing and marketing
sculptures, paintings and illustrations. Mr. Hamby has developed a specialty
in bronze sculptures and has created almost two dozen original bronze
sculptures which are being re-produced and marketed in limited editions of as
few as seven and as many as one thousand copies per edition. These limited
edition copies are being offered to the public at prices ranging from $300 to
$38,000 per copy, depending on the particular sculpture and the number of
copies in the edition.
To provide increased exposure to the public of the bronze sculptures,
increase public awareness of Mr. Hamby's artwork, and reach greater numbers of
people who might be interested in acquiring the artwork, both Mr. Hamby and
management of Bronze Marketing believe it is necessary
<PAGE>
to have these limited
edition copies on display in as many art galleries as possible, as well as
other retail outlets which are frequented by potential art purchasers. Mr.
Hamby has found that the art galleries and retail outlets are typically
willing to take and display the items only on a consignment basis. Due to the
lack of available financing, Mr. Hamby has been unable to effect any
widespread distribution of his artwork on consignment. Consequently,
management of Bronze Marketing entered into an arrangement with Mr. Hamby's
studio under which Bronze Marketing agreed to raise capital through securities
offerings, and use the net proceeds to provide financing. In return, Mr.
Hamby agreed that Bronze Marketing will be entitled to a portion of the gross
proceeds received from the marketing and sale of the artwork. Under this
arrangement, Bronze Marketing advanced funds to pay for the cost of casting
copies of Mr. Hamby's limited edition bronze sculptures. This cost typically
is about 18-22% of the retail price. Mr. Hamby then arranged for these copies
to be placed on consignment with art galleries or other retail outlets where
they are on display to be seen by the patrons of these establishments. Upon
any sale, Bronze Marketing is entitled to a portion of the gross proceeds.
On September 1, 1999, Bronze Marketing and Mr. Hamby revised the
arrangement. Bronze Marketing took ownership of the remaining sculpture
inventory as payment in full of the advances, notes receivable and accrued
interest owed to it. Bronze Marketing has discounted the inventory on its
books to half the retail value. The existing inventory has a retail value of
$46,900 but if necessary to provide liquidity, management may liquidate the
existing inventory of sculptures in which Bronze Marketing has acquired an
interest through online auctioning of the pieces using Internet sites that
feature online auctions of sculptures and other art. Management believes the
existing inventory can be sold or auctioned for half or more of its retail
value. Bronze Marketing and Mr. Hamby also revised the arrangement for
additional bronze sculptures in the future. Under the new formula worked out
between Bronze Marketing and Mr. Hamby, Bronze Marketing will be entitled to
recoup the amount it provides to pay the casting cost, plus receive 50% of the
balance of the proceeds from any sale. To the extent any funds become
available from warrant exercise or from sale of the existing inventory, Bronze
Marketing will pay the casting cost, but only of two sculptures which
management of Bronze Marketing and Mr. Hamby believe have the best market
potential. One sculpture titled "Wapiti"is a larger than life size statue of a
bull elk. The other is a sculpture of a cowboy titled "Cowboy's Day Off"
which can be made in a three foot size or life size. Mr. Hamby has received
indications from an art gallery regarding sales of these sculptures which the
gallery believes could have been made from stock on hand if the gallery had
one or more copies in its inventory. Based on these indications, management
of Bronze Marketing and Mr. Hamby believe these two sculptures have the best
current market potential. Without pre-casting the sculptures to allow for sale
from stock on hand with immediate delivery, it takes several months to produce
and deliver a sculpture. However, even with pre-casting, there is no
assurance of the amount of sales, if any, there might be under this
arrangement, nor do we know how long it may be from the time Bronze Marketing
pays for the production cost of a sculpture and the time, if ever, that Bronze
Marketing will receive any proceeds from the sale.
<PAGE>
PRODUCTS AND SERVICES
Bronze Marketing's current inventory of Mr. Hamby's original sculptures
include the following:
<TABLE>
<S> <C> <C>
TITLE AND DESCRIPTION No. acquiredRetail Price
"GUS" (Cowboy bust, 1st in series of four) 1 $ 1,400
"COWBOY BOOTS" 10 $ 1,100
"THE MOUNTAIN MAN" (Hunter with Bird) 2 $ 4,400
"SUPPER TIME" (Bald Eagle with Trout) 1 $ 2,800
"SPIRITS IN THE WIND" (Lodge Pole) 2 $ 9,600
"CHALLENGE ON THE YELLOWSTONE" 1 $ 4,800
"A SIGN OF PEACE" 1 $ 5,200
"WAR HORSE" (Indians protector dressed 3 $ 3,600
for battle)
"WISDOM OF A CHIEF" (Indian figure) 2 $ 4,400
"RUNNIN THUNDER" (Buffalo) 1 $ 1,400
"MONTANA REX" (Bull) 1 $ 2,400
"TRUTH IN JUSTICE" (Bald Eagle in Justice)1 $ 5,800
</TABLE>
ITEM 2. PROPERTIES
Bronze Marketing presently has no lease or office facilities but will
use the address of its President without charge for the time being. The
President will work out of her home until Bronze Marketing commences active
business operations and has the need to lease commercial office space and the
ability to pay for the facilities. As of the date of this prospectus, Bronze
Marketing has no full-time employees.
ITEM 3. LEGAL PROCEEDINGS.
The Company is not a party to any material pending legal proceedings
and, to the best of its knowledge, no action has been threatened by or against
the Company.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
No matter was submitted to a vote of security holders through the
solicitation of proxies or otherwise during the fourth quarter of the fiscal
year covered by this report.
<PAGE>
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
(A) MARKET INFORMATION.
The common stock of Bronze Marketing is quoted on the Electronic
Bulletin Board maintained by the National Association of Securities Dealers,
Inc. under the symbol "BNZE", but has not been traded in the over-the-counter
market except on a very limited and sporadic basis. The following sets forth
high and low bid price quotations for each calendar quarter during the last
two fiscal years that trading occurred or quotations were available. Such
quotations reflect inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions.
Quarter Ended High Low
March 31, 1998 .52 .50
June 30, 1998 .52 .50
September 30, 1998 .52 .50
December 31, 1998 .55 .50
March 31, 1999 .55 .50
June 30, 1999 .55 .50
September 30, 1999 1.00 .50
December 31, 1999 1.00 .50
(B) HOLDERS.
As of April 5, 2000, there were about 47 record holders of the Company's
Common Stock.
(C) DIVIDENDS.
Bronze Marketing has not previously paid any cash dividends on common
stock and does not anticipate or contemplate paying dividends on common
stock in the foreseeable future. Our present intention is to utilize all
available funds for the development of our business. The only restrictions
that limit the ability to pay dividends on common equity or that are likely to
do so in the future, are those restrictions imposed by law. Under Nevada
corporate law, no dividends or other distributions may be made which would
render a company insolvent or reduce assets to less than the sum of
liabilities plus the amount needed to satisfy outstanding liquidation
preferences.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
PLAN OF OPERATIONS.
Bronze Marketing was only recently incorporated on May 1, 1997, has not
generated
<PAGE>
significant revenues from operations and is still considered a
development stage company. Management's plan of operation for the next twelve
months is to use any funds received from exercise of warrants in this offering
to provide financing for the creation of additional works of art and increased
marketing exposure of the artworks, and also to provide general working
capital during the next twelve months. Under this plan of operations Bronze
Marketing has no specific capital commitments and the timing of expenditures
will depend upon the receipt of additional funds from warrant exercise or
elsewhere, none of which is assured. Cash flows will also depend upon the
timing of sale of the artwork, which is also not assured, and receipt of the
proceeds from these sales. There were no sales royalties generated or received
during 1998 or 1999, because there have not been any sales of the existing
artwork. As a result, Bronze Marketing took ownership of the remaining
sculpture inventory as payment in full of the advances, notes receivable and
accrued interest owed to it, which totaled $49,310 at June 30, 1999. If
necessary to provide liquidity, management may auction or liquidate the
existing inventory of sculptures in which Bronze Marketing has acquired an
interest through online auctioning of the pieces using Internet sites that
feature online auctions of sculptures and other art. Management believes this
will allow Bronze Marketing to liquidate the existing inventory as promptly as
possible, if that becomes necessary. Management believes the existing
inventory can be auctioned for half or more of its retail value, and has
discounted the inventory on the books to $23,450 or half its retail value.
As soon as possible after Bronze Marketing receives the proceeds from
these sales and/or receives additional funds from warrant exercise, management
will use the funds to pay for the casting cost of additional limited edition
copies, but only of those sculptures which management and the artist believe
have the best market potential, based on indications of interest received.
Management believes that with the additional funding it could receive from
warrant exercise in this offering, Bronze Marketing could provide sufficient
financing for more copies of artwork to be made and placed on consignment to
increase marketing exposure. Management is hopeful that increased marketing
exposure will result in increases in sales sufficient to generate enough
revenue to Bronze Marketing to become profitable. However, we are not assured
of this nor do we know how much may be raised from warrant exercise, because
we do not know if all or any minimum number of the warrants will be exercised.
At this time, we do not know how long it will be necessary to fund operations
from existing capital.
ITEM 7. FINANCIAL STATEMENTS.
See attached Financial Statements and Schedules.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
There are not and have not been any disagreements between the Company
and their accountants on any matter of accounting principles or practices or
financial statement disclosure.
<PAGE>
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
(A) IDENTIFY DIRECTORS AND EXECUTIVE OFFICERS.
The following table shows the directors, executive officers and other
significant employees of Bronze Marketing, their ages, and all offices and
positions with Bronze Marketing. Each director is elected for a period of one
year and thereafter serves until a successor is duly elected by the
stockholders and qualifies. Officers and other employees serve at the will of
the board of directors.
<TABLE>
<S> <C> <C>
Term Served As Positions
Name of Director Age Director/Officer With Company
Heather Hamby 29 Since inception President, Secretary-Treasurer
& Director
</TABLE>
This individual will serve as the sole officer and director of Bronze
Marketing. A brief description of her background and business experience
follows:
HEATHER HAMBY has been engaged in the fashion modeling industry for the
past several years. After graduation from high school in 1987, Ms. Hamby
attended college for two years, and then began a modeling career, initially in
New York City. One year later, she received a modeling contract with McCarty
Modeling Agency in Salt Lake City, Utah. In 1991, she began working for Kutte
- - Le Gunn Modeling Agency and pursued her career there until 1996. In 1994
she began working with various Conventions and Trade Shows for a wide variety
of companies nationwide, and is currently working as an independent model with
Nordstrom Fashion Trend Shows. Ms. Hamby is the sister of Mike Hamby.
There are no arrangements or understandings regarding how long a
director is to serve in that capacity. The director holds no directorships in
any other company subject to the reporting requirements of the Securities
Exchange Act of 1934.
(B) IDENTIFY SIGNIFICANT EMPLOYEES.
None other than the person previously identified.
(C) FAMILY RELATIONSHIPS.
None
<PAGE>
(D) INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS.
Except as described herein, no present officer or director of the
Company; 1) has had any petition filed, within the past five years, in Federal
Bankruptcy or state insolvency proceedings on such person's behalf or on
behalf of any entity of which such person was an officer or general partner
within two years of filing; or 2) has been convicted in a criminal proceeding
within the past five years or is currently a named subject of a pending
criminal proceeding; or 3) has been the subject, within the past five years,
of any order, judgment, decree or finding (not subsequently reversed,
suspended or vacated) of any court or regulatory authority involving violation
of securities or commodities laws, or barring, suspending, enjoining or
limiting any activity relating to securities, commodities or other business
practice.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.
The Issuer is not subject to Section 16(a).
ITEM 10. EXECUTIVE COMPENSATION.
Bronze Marketing was only recently incorporated, and has not paid any
compensation to its executive officer and director to date. Bronze Marketing
has no employment agreement with nor key man life insurance on management.
Management is entitled to reimbursement of any out of pocket expenses
reasonably and actually incurred on behalf of Bronze Marketing. The officer
does not devote full time or a significant amount of time to the affairs of
Bronze Marketing, is not a full time employee and does not receive any salary
or wage. We do not know how long this arrangement may continue, nor do we
know how long the services of the officer will continue to be available.
COMPENSATION OF DIRECTORS. None
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS
The Company has not entered into any contracts or arrangements with any
named executive officer which would provide such individual with a form of
compensation resulting from such individual's resignation, retirement or any
other termination of such executive officer's employment with the Company or
its subsidiary, or from a change-in-control of the Company or a change in the
named executive officer's responsibilities following a change-in-control.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table shows stock ownership information of officers,
directors and any others who we know to be beneficial owners of more than 5%
of our stock. Any person who has or shares the power to decide how to vote or
whether to dispose of stock is a beneficial owner.
<PAGE>
<TABLE>
<S> <C> <C> <C>
Title of Amount & Nature of % of
Name and Address Class Beneficial Ownership Class
Heather Hamby Common 500,000 shares 50%
426 S. 1000 E. #704
SLC, UT 84102
Lynn Dixon Common 400,000 shares 40%
311 S. State, #460
SLC, UT 84111
All officers and Common 500,000 shares 50%
directors as a
group (1 person)
</TABLE>
The foregoing amounts include all shares these persons are deemed to
beneficially own regardless of the form of ownership.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The Company has entered into certain transactions with officers,
directors or affiliates of the Company which include the following:
In connection with the organization of Bronze Marketing, its officers,
directors and other stockholders paid an aggregate of $5,400 cash to purchase
900,000 shares of Common Stock of Bronze Marketing at a price of $.006 per
share.
In July, 1997, Bronze Marketing completed an offering under Regulation
D, Rule 504 as promulgated by the Securities and Exchange Commission and sold
100,000 shares of common stock, at $.35 per share, and raised gross proceeds
of $35,000. These are free-trading shares.
Bronze Marketing has the business arrangement with Michael Hamby
Studios, previously described in the business section of this prospectus.
Michael Hamby is the brother of the President of Bronze Marketing, Heather
Hamby. He is not an officer, director or shareholder of Bronze Marketing.
Neither Bronze Marketing nor Michael Hamby is investing in or acquiring any
securities of the other. An investment in Bronze Marketing does not constitute
any investment in Michael Hamby Studios, but because of the business
arrangement with Bronze Marketing, there have been and may continue to be
significant amounts of related party transactions between them.
Except as disclosed in this item, in notes to the financial statements
or elsewhere in this report, the Company is not aware of any indebtedness or
other transaction in which the amount involved exceeds $60,000 between the
Company and any officer, director, nominee for director, or 5% or greater
beneficial owner of the Company or an immediate family member of such person;
nor is the Company aware of any relationship in which a director or nominee
for director of the Company was
<PAGE>
also an officer, director, nominee for
director, greater than 10% equity owner, partner, or member of any firm or
other entity which received from or paid the Company, for property or
services, amounts exceeding 5% of the gross annual revenues or total assets of
the Company or such other firm or entity.
PART IV
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.
(A) EXHIBITS to this report are all documents previously filed which
are incorporated herein as exhibits to this report by reference to
registration statements and other reports previously filed by the Company
pursuant to the Securities Act of 1933 and the Securities Exchange Act of
1934.
(B) REPORTS ON FORM 8-K have not been filed during the last quarter of
the fiscal year ended December 31, 1999.
<PAGE>
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, thereunto duly authorized.
BRONZE MARKETING, INC.
By: /s/ Heather Hamby Date: April 5, 2000
Heather Hamby, President and Secretary/Treasurer
Chief Executive Officer and
Chief Financial Officer
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and the
dates indicated.
By: /s/ Heather Hamby Date: April 5, 2000
Heather Hamby, President and Secretary/Treasurer
Chief Executive Officer and
Chief Financial Officer
<PAGE>
Supplemental Information to be Furnished With Reports Filed Pursuant to
Section 15(d) of the Exchange Act by Non Reporting Issuers
No annual report or proxy statement has been sent to security holders.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
FINANCIAL STATEMENTS
DECEMBER 31, 1999
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
CONTENTS
PAGE
- Independent Auditors' Report 1
- Balance Sheet, December 31, 1999 2
- Statements of Operations, for the years ended
December 31, 1999 and 1998 and from inception
on May 1, 1997 through December 31, 1999 3
- Statement of Stockholders' Equity, from
inception on May 1, 1997 through
December 31, 1999 4
- Statements of Cash Flows, for the years ended
December 31, 1999 and 1998 and
from inception on May 1, 1997 through
December 31, 1999 5
- Notes to Financial Statements 6 - 10
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors
BRONZE MARKETING, INC.
Salt Lake City, Utah
We have audited the accompanying balance sheet of Bronze Marketing, Inc. [a
development stage company] at December 31, 1999, and the related statements of
operations, stockholders' equity and cash flows for the years ended December
31, 1999 and 1998 and for the period from inception on May 1, 1997 through
December 31, 1999. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements audited by us present fairly, in all
material respects, the financial position of Bronze Marketing, Inc. as of
December 31, 1999, and the results of its operations and its cash flows for
the years ended December 31, 1999 and 1998 and for the period from inception
through December 31, 1999, 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 incurred losses since its inception and has not
yet been successful in establishing profitable operations, raising substantial
doubt about its ability to continue as a going concern. Management's plans in
regards to these matters are also described in Note 5. The financial
statements do not include any adjustments that might result from the outcome
of these uncertainties.
/s/ Pritchett, Siler & Hardy, P.C.
March 15, 2000
Salt Lake City, Utah
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
BALANCE SHEET
ASSETS
December 31,
1999
____________
CURRENT ASSETS:
Cash in bank $ 10,128
Inventory on consignment 23,450
___________
Total Current Assets $ 33,578
___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 790
Advances from shareholders 22,800
__________
23,590
__________
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value,
1,000,000 shares authorized,
no shares issued and outstanding -
Common stock, $.001 par value,
24,000,000 shares authorized,
1,050,000 shares issued and
outstanding 1,050
Capital in excess of par value 51,926
Deficit accumulated during the
development stage (42,988)
___________
Total Stockholders' Equity 9,988
___________
$ 33,578
___________
The accompanying notes are an integral part of this financial statement.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
STATEMENTS OF OPERATIONS
From
For the Inception on
Year Ended May 1, 1997,
December 31, Through
_____________________ December 31,
1999 1998 1999
__________ __________ ________________
REVENUE:
Sales royalties $ - $ - $ 2,079
__________ __________ ________________
Total Revenue - - 2,079
EXPENSES:
General and administrative 16,986 3,058 22,362
Bad debt expense - related
party 25,860 - 25,860
__________ __________ ________________
Total Expenses 42,846 3,058 48,222
__________ __________ ________________
LOSS FROM OPERATIONS (42,846) (3,058) (46,143)
OTHER INCOME:
Interest income - related party 1,267 2,544 3,821
__________ __________ ________________
LOSS BEFORE INCOME TAXES (41,579) (504) (42,322)
CURRENT TAX EXPENSE - - -
DEFERRED TAX EXPENSE - - -
__________ __________ ________________
LOSS FROM CONTINUING
OPERATIONS BEFORE
CHANGE IN ACCOUNTING
PRINCIPLE (41,579) (504) (42,322)
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE (666) - (666)
__________ __________ ________________
NET LOSS $ (42,245) $ (504) $ (42,988)
__________ __________ ________________
LOSS PER COMMON SHARE:
Continuing operations $ (.04) $ (.00) $ (.04)
Cumulative effect of change
in accounting principle (.00) (.00) (.00)
__________ __________ ________________
Net Loss Per Common Share $ (.04) $ (.00) $ (.04)
__________ __________ ________________
The accompanying notes are an integral part of these financial statements.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
STATEMENT OF STOCKHOLDERS' EQUITY
FROM THE DATE OF INCEPTION ON MAY 1, 1997
THROUGH DECEMBER 31, 1999
Deficit
Accumulated
Preferred Stock Common Stock Capital in During the
_________________ _________________ Excess of Development
Shares Amount Shares Amount Par Value Stage
_________ _______ _________ _______ __________ ___________
BALANCE, May 1, 1997 - $ - - $ - $ - $ -
Issuance of 900,000
shares common stock
for cash, May 7,
1997 at $.006 per
share - - 900,000 900 4,500 -
Issuance of 100,000
shares common stock
for cash, July 1997
at $.35 per share,
net of offering
costs of $4,924 - - 100,000 100 29,976 -
Net loss for the
period ended
December 31, 1997 - - - - - (239)
_________ _______ _________ _______ __________ ___________
BALANCE,
December 31, 1997 - - 1,000,000 1,000 34,476 (239)
Net loss for the year
ended December 31,
1998 - - - - - (504)
_________ _______ _________ _______ __________ ___________
BALANCE,
December 31, 1998 - - 1,000,000 1,000 34,476 (743)
Issuance of 50,000
shares common
stock for cash,
December 29, 1999 at
$.35 per share - - 50,000 50 17,450 -
Net loss for the year
ended December 31,
1999 - - - - - (42,245)
_________ _______ _________ _______ __________ ___________
BALANCE,
December 31, 1999 - $ - 1,050,000 $ 1,050 $ 51,926$ (42,988)
_________ _______ _________ _______ __________ ___________
The accompanying notes are an integral part of this financial statement.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
STATEMENTS OF CASH FLOWS
From
For the Inception on
Year Ended May 1, 1997,
December 31, Through
_____________________ December 31,
1999 1998 1999
__________ __________ ________________
Cash Flows From Operating Activities:
Net loss $ (42,245) $ (504) $ (42,988)
Adjustments to reconcile net
loss to net cash used by
operating activities:
Bad debt expense - related party 25,860 - 25,860
Effect of change in accounting
principle 666 - 666
Amortization expense - 200 334
Change in assets and liabilities:
(Increase) in interest
receivable - related party (1,267) (2,554) (3,821)
Increase (decrease) in accounts
payable 790 (300) 790
__________ __________ ________________
Net Cash (Used) by Operating
Activities (16,196) (3,158) (19,159)
__________ __________ ________________
Cash Flows From Investing Activities:
Payment of organization costs - - (1,000)
(Increase) in note receivable -
related party - - (36,489)
(Increase) in advance receivable -
related party - (9,000) (9,000)
__________ __________ ________________
Net Cash (Used) by Investing
Activities - (9,000) (46,489)
__________ __________ ________________
Cash Flows From Financing Activities:
Proceeds from common stock
issuance 17,500 - 57,900
Proceeds from advances from
shareholders 8,800 10,500 22,800
Stock offering costs - - (4,924)
__________ __________ ________________
Net Cash Provided by
Financing Activities 26,300 10,500 75,776
__________ __________ ________________
Net Increase (Decrease) in Cash 10,104 (1,658) 10,128
Cash at Beginning of Period 24 1,682 -
__________ __________ ________________
Cash at End of Period $ 10,128 $ 24 $ 10,128
__________ __________ ________________
Supplemental Disclosures of Cash Flow Information:
Cash paid during the periods for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
Supplemental Schedule of Noncash Investing and Financing Activities:
For the year ended December 31, 1999:
The Company expensed its remaining organizational costs of $666 in
accordance with Statement of Position 98-5.
The Company's receivables and advances from related parties in the amount
of $49,130 were converted for inventory in the amount of $23,450. Bad debt
expense of $25,860 was recorded for the remainder.
For the year ended December 31, 1998:
None
The accompanying notes are an integral part of these financial statements.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - Bronze Marketing, Inc. (the Company) was organized under the
laws of the State of Nevada on May 1, 1997. The Company initially engaged in
the business of providing inventory financing to facilitate the marketing of
bronze artwork and sculptures created by a relative of the Company's
President. The Company received royalties from the sale of the inventory.
However, during 1999 the Company restructured its business plans and currently
is attempting to market its inventory of bronze artwork and sculptures. The
Company has, at the present time, not paid any dividends and any dividends
that may be paid in the future will depend upon the financial requirements of
the Company and other relevant factors. The Company has not generated
significant revenues and is considered a development stage company as defined
in Statement of Financial Accounting Standards (SFAS) No. 7.
Organization Costs - Organization costs, which reflect amounts expended to
organize the Company, amounted to $1,000 and were expensed in accordance with
Statement of Position 98-5, "Reporting on the Costs of Start-Up Activities".
Revenue Recognition - The Company recognizes revenue from royalties in the
period when the underlying sales take place. Revenue from sales are
recognized upon delivery of the product.
Inventory - Inventory is carried at the lower of cost or market using the
First In, First Out method. [See Note 2]
Loss Per Share - The Company computes loss per share in accordance with
Statement of Financial Accounting Standards (SFAS) No. 128 "Earnings Per
Share," which requires the Company to present basic earnings per share and
dilutive earning per share when the effect is dilutive. [See Note 5]
Income Taxes - The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes." This statement requires an asset and liability approach for
accounting for income taxes.
Cash and Cash Equivalents - For purposes of the financial statements, the
Company considers all highly liquid debt investments purchased with a maturity
of three months or less to be cash equivalents.
Accounting Estimates - The preparation 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, the disclosures of contingent assets and liabilities at the date
of the financial statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimated
by management.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Continued]
Recently Enacted Accounting Standards - Statement of Financial Accounting
Standards (SFAS) No. 132, "Employer's Disclosure about Pensions and Other
Postretirement Benefits", SFAS No. 133, "Accounting for Derivative Instruments
and Hedging Activities", SFAS No. 134, "Accounting for Mortgage-Backed
Securities." and SFAS No. 135, "Rescission of FASB Statement No. 75 and
Technical Corrections" were recently issued. SFAS No. 132, 133, 134 and 135
have no current applicability to the Company or their effect on the financial
statements would not have been significant.
NOTE 2 - INVENTORY
At December 31, 1999, inventory consisted of finished bronze sculptures valued
at $23,450, acquired from a relative of the President of the Company [See Note
6]. The inventory is held on consignment by an art gallery and the Sculptor
in the states of Utah, Wyoming, and New York.
NOTE 3 - CAPITAL STOCK AND WARRANTS
Common Stock - During May 1997, in connection with its organization, the
Company issued 900,000 shares of its previously authorized, but unissued
common stock. Total proceeds from the sale of stock amounted to $5,400 (or
$.006 per share).
Public Offering of Common Stock - During 1997 the Company made a public
offering of 100,000 shares of its previously authorized, but unissued common
stock. This offering was exempt from registration with the Securities and
Exchange Commission under Rule 504 of Regulation D as promulgated under the
Securities Act of 1933, as amended. The offering price of $.35 per share was
arbitrarily determined by the Company. The offering was managed by the
Company without any underwriter. The shares were offered and sold by an
officer of the Company, who received no sales commissions or other
compensation in connection with the offering, except for reimbursement of
expenses actually incurred on behalf of the Company in connection with the
offering. Total proceeds from the sale of stock amounted to $35,000. The
Company incurred stock offering costs of $4,924 in connection with the stock
offering. The stock offering costs have been netted against the proceeds of
the public stock offering as a reduction to capital in excess of par value.
During December 1999, the Company issued 50,000 shares of its previously
authorized, but unissued common stock. Total proceeds from the sale of stock
amounted to $17,500 (or $.35 per share.)
Preferred Stock - The Company has authorized 1,000,000 shares of preferred
stock, $.001 par value, with such rights, preferences and designations and to
be issued in such series as determined by the Board of Directors. No shares
are issued and outstanding at December 31, 1999.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 3 - CAPITAL STOCK AND WARRANTS [Continued]
Common Stock Warrants Offering -. During 1999 the Company declared a dividend
of 1,000,000 warrants to purchase common stock ("the warrants") to
shareholders of record as of October 27, 1999. The Company filed a
registration statement with the United States Securities and Exchange
Commission on Form SB-2 under the Securities Act of 1933 to register the
shares of common stock underlying the warrants. Each warrant allows the
holder to acquire one share of common stock at $1.00 per share. The
warrants are exercisable at any time until June 30, 2002. The Company may
redeem all or a portion of the warrants, at $.01 per warrant, at any time
upon 30 days' prior written notice to the warrant holders.
NOTE 4 - INCOME TAXES
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standards No. 109 "Accounting for Income Taxes". SFAS
No. 109 requires the Company to provide a net deferred tax asset/liability
equal to the expected future tax benefit/expense of temporary reporting
differences between book and tax accounting methods and any available
operating loss or tax credit carryforwards. The Company has available at
December 31, 1999, an operating loss carryforward of approximately $16,500,
which may be applied against future taxable income and which expires in
various years through 2019.
The amount of and ultimate realization of the benefits from the operating loss
carryforward for income tax purposes is dependent, in part, upon the tax laws
in effect, the future earnings of the Company, and other future events, the
effects of which cannot be determined. Because of the uncertainty surrounding
the realization of the loss carryforward the Company has established a
valuation allowance equal to the amount of the loss carryforward and,
therefore, no deferred tax asset has been recognized for the loss
carryforward. The net deferred tax asset is approximately $5,600 as of
December 31, 1999, with an offsetting valuation allowance at December 31, 1999
of the same amount. The change in the valuation allowance for the year ended
December 31, 1999 is approximately $5,300.
NOTE 5 - GOING CONCERN
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplate continuation of
the Company as a going concern. However, the Company has incurred losses
since its inception, and has not yet been successful in establishing
profitable operations. These factors raise substantial doubt about the
ability of the Company to continue as a going concern. In this regard,
management is proposing to raise any necessary additional funds not provided
by operations through loans and/or through additional sales of its common
stock. There is no assurance that the Company will be successful in raising
this additional capital or in achieving profitable operations. The financial
statements do not include any adjustments that might result from the outcome
of these uncertainties.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 6 - RELATED PARTY TRANSACTIONS
Management Compensation - The Company has not paid any compensation to its
officers and directors as the services provided by them to date have only been
nominal.
Office Space - The Company has not had a need to rent office space. An
officer/shareholder of the Company is allowing the Company to use her office
as a mailing address, as needed, at no expense to the Company.
Advances From Shareholders - During 1999, shareholders of the Company advanced
a total of $8,800 to the Company. The advances are due upon demand and do not
accrue interest.
During 1998, a shareholder of the Company advanced a total of $10,500 to the
Company. The advances are due upon demand and do not accrue interest.
Note Receivable/Advances - The Company had entered into an arrangement with a
relative of the Company's President, who is a freelance artist and who has an
inventory of original bronze sculptures which are being re-produced and
marketed in limited editions. The Company raised capital to provide financing
to produce limited edition bronze sculptures which were placed in art studios
and galleries on consignment. Upon the ultimate sale of the sculptures the
Company was to receive the casting costs plus an amount from 3 to 7 percent of
the underlying sales proceeds depending upon the level of sales achieved.
During 1997, the Company received royalty payments of $2,079 based on sales.
On January 1, 1998, the above marketing arrangement was amended to include the
conversion of the advances to a note receivable for $36,489. Specific
sculptures were also identified as collateral for the note. The note matures
on January 1, 2000 but provided for payments as specific sculptures were sold.
The note also provided for interest at 7% per annum. Interest income of
$3,821 was earned on the note receivable through September 1, 1999.
During 1998 the Company made additional advances for the production of
sculptures totaling $9,000 The advances were made to an entity owned by a
relative of the Company's President. No interest has been accrued on the
additional advances. No payments were received on the advances.
On September 1, 1999, the Company entered into an agreement with a relative of
the Company's President which supercedes and amends the above agreements. The
terms of the new agreement provides for the Company to take ownership of the
remaining sculpture inventory as payment in full on the advances, notes
receivable and accrued interest, which totaled $49,310. The inventory was
valued at $23,450 by the Company, which took into account the carry-over basis
of the inventory and expected future realization of the inventory [See Note
2]. The excess of $25,860 was recorded as bad debt expense.
<PAGE>
BRONZE MARKETING, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 7 - LOSS PER SHARE
The following data show the amounts used in computing loss per share and the
weighted average number of shares of common stock outstanding for the periods
presented:
From
For the Inception on
Year Ended May 1, 1997,
December 31, Through
_____________________ December 31,
1999 1998 1999
__________ __________ ________________
Loss from continuing operations
available to common shareholders
(numerator) $(42,245) $ (504) $ (42,988)
__________ __________ ________________
Cumulative effect of change in
accounting principle
(numerator) $ (666) $ - $ (666)
__________ __________ ________________
Weighted average number of common
shares outstanding during the
period used in loss per share
(denominator) 1,000,274 1,000,000 989,228
__________ __________ ________________
Dilutive loss per share was not presented, as the Company had no common
equivalent shares for all periods presented that would affect the computation
of diluted loss per share.
At December 31, 1999, the Company had 1,000,000 outstanding common stock
purchase warrants which were not used in the loss per share computation
because their effect would be anti-dilutive.
During 1999, the Company adopted Statement of Position 98-5 and accordingly
expensed its remaining organization costs of $666. This has been reflected as
a cumulative effect of change in accounting principle.
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
financial statements for the year ended December 31, 1999 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 10,128
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 23,450
<CURRENT-ASSETS> 33,578
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 33,578
<CURRENT-LIABILITIES> 23,590
<BONDS> 0
0
0
<COMMON> 1,050
<OTHER-SE> 8,938
<TOTAL-LIABILITY-AND-EQUITY> 33,578
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 42,846
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (41,579)
<INCOME-TAX> 0
<INCOME-CONTINUING> (41,579)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> (666)
<NET-INCOME> (42,245)
<EPS-BASIC> (.04)
<EPS-DILUTED> (.04)
</TABLE>
