U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUER
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
BECK & CO.
(Name of Small Business Issuer in its charter)
Nevada 88-0390828
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
7865 South Citori Drive, Building B No. 206, Sandy, UT 84070
(Address of Principal Executive Offices and Zip Code)
Issuer's Telephone Number: (801) 562-5687
Securities to be registered under Section 12(b) of the Act:
Securities to be registered under Section 12(g) of the Act:
Common Stock, Par Value $0.001
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TABLE OF CONTENTS
ITEM NUMBER AND CAPTION Page
Part I 3
1. Description of Business 3
2. Management's Discussion and Analysis or Plan of 4
Operations
3. Description of Properties 4
4. Security Ownership of Certain Beneficial Owners and 4
Management
5. Directors, Executive Officers, Promoters and Control 5
Persons
6. Executive Compensation 6
7. Certain Relationships and Related Transactions 6
8. Legal Proceedings 6
9. Market for Common Equity and Related Stockholder 6
Matters
10. Recent Sales of Unregistered Securities 6
11. Description of Securities 7
12. Indemnification of Directors and Officers 8
13. Financial Statements 8
14. Changes in and Disagreements with Accountants on 8
Accounting and Financial Disclosure
15. Financial Statements and Exhibits 9
2
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ITEM 1. DESCRIPTION OF BUSINESS
History
The Company was formed as a Nevada corporation on April 14, 1998,
for the purpose of operating as a specialty jewelry retailer.
Immediately following organization of the Company, it issued
1,000,000 shares of its common stock to its officer and director,
Larry L. Beck for services rendered to the Company. In April
1998, the Company completed a private offering of 500,000 shares
of its common stock as a sales price of $0.001 per share or an
aggregate offering of $500 [founders]. In April 1999, the
Company completed a private offering of 21,750 shares of its
common stock at a sales price of $1.00 per share or an aggregate
offering of $21,750.
General
The Company was organized to operate as a specialty retailer of
fine jewelry. With the completion of its private offering, the
Company will commence its operations by establishing a retail
jewelry presence on the Internet. The Company plans on
establishing specialty outlets in small rural communities
nationwide, where it can achieve local market dominance. The
Company will offer an in-depth selection of fine jewelry and
precious and semi-precious gemstones including diamonds, gold,
precious and semi-precious jewelry.
The Company will initially establish a retail presence on the
Internet until it is able to raise sufficient funds to begin
implementing its plan to open retail stores in small rural
communities. It will establish and maintain a website on the
Internet, cataloging its jewelry products and allowing customers
to purchase products online.
The Company plans on opening from 500-800 square foot retail
stores in rural communities that convey a pleasant and inviting
ambiance. With its retail stores operating in small rural
communities, the Company believes that it will not have to
contend with the substantial number of competitors located in
larger cities and will benefit from word of mouth advertising.
Store concepts are expected to be designed around a natural or
`new age' theme. As such, special attention will be given to
lighting, colors and background music. The use of several cases
will allow the Company's customers to have a partial look at
merchandise, allowing a well planned sales presentation to
commence.
The Company does not manufacture its merchandise. It anticipates
purchasing substantially its entire inventory directly from third
party manufacturers and cutters located in the United States and
abroad. The Company anticipates that vendors will commit
merchandise on a consignment basis, eliminating the need to
purchase inventory until it is sold. The Company also
anticipates having arrangements with subcontractors to finish and
set stones in order to keep costs down.
The Company plans on using computer systems to accurately control
inventory. The computer systems will also assist in direct
mailings, and facilitate future add on sales by customers. The
Company will maintain a database of its customers buying habits,
birthdays, anniversaries and other special occasions and be able
to direct target-mailing offerings add on merchandise.
Governmental Regulation
There is no significant government regulation of the Company's
operations.
Competition
The Company will be involved in intense competition with other
local jewelry outlets as well as mail order companies and other
Internet sites. Such competing companies have lengthier
experience as jewelry retailers, along with greater financial and
other resources than the Company. Additionally, the Company will
compete, to a limited extent, with out of state jewelry outlets
to the extent that customers choose to purchase products in
larger cities. There is no assurance that the Company will be
able to respond to competitive pressures.
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Employees
The Company is a development stage company and currently has no
employees, except its executive officers. Management of the
Company expects to use consultants, attorneys, and accountants as
necessary. The need for full-time employees and their
availability will be determined on an as needed basis.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATIONS
Results of Operations
Quarterly Period Ended March 31, 1999 and Calendar Year Ended
December 31, 1998.
The Company had net sales of $185 in the first quarter of 1999
and $13,229 for the period from inception on April 15, 1998,
through December 31, 1998. Cost of Sales was $28 in the first
quarter of 1999 and $8,940 for the period from inception on April
15, 1998, through December 31, 1998.
General and administrative expenses in the first quarter of 1999
and period ended December 31, 1998, consisted of general
corporate administration, legal and professional expenses, and
accounting and auditing costs. These expenses were $2,370 for
the three months ended March 31, 1999 and $11,052 for the period
year from inception on April 15, 1998, through December 31, 1998.
The Company had no interest expense or income in the periods
ending March 31, 1999 or December 31, 1998.
As a result of the foregoing factors, the Company realized a net
loss of $2,213 for the quarter ended March 31, 1999, and a net
loss of $6,763 for the period from inception on April 15, 1998,
through December 31, 1998..
Liquidity and Capital Resources
At March 31, 1999, the Company had working capital of $14,274 as
compared to working capital of $1,737 at December 31, 1998. The
working capital resulted form the sale of 21,750 shares of common
stock resulting in gross proceeds to the Company of $21,750. The
Company intends to apply its working capital to paying
administrative costs and marketing the Company's jewelry products
through its website. The Company estimates that the net proceeds
of the offering will cover the Company's operating expenses for a
term of six months through October 1999, after which the Company
intends to rely on revenue generated from sale of its jewelry
products to fund operations, including the Company's plan to
establish retail locations in rural communities. If the Company
is unable to generate sufficient revenue to support and expand
its operations, it may need to seek debt or equity financing.
The Company has not identified any potential sources of debt or
equity financing and can not predict whether any such financing
will be available to the Company should it be needed on terms
acceptable to the Company.
ITEM 3. DESCRIPTION OF PROPERTIES
The Company is currently operating from a home office located at
[new]. This office is provided by an officer and director of the
Company at no expense.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth as of May 27, 1999, the number and
percentage of the outstanding shares of common stock which,
according to the information supplied to the Company, were
beneficially owned by (i) each person who is currently a director
of the Company, (ii) each executive officer, (iii) all current
directors and executive officers of the Company as a group and
(iv) each person who, to the knowledge of the Company, is the
beneficial owner of more than 5% of the outstanding common stock.
Except as otherwise indicated, the persons named in the table
have sole voting and dispositive power with respect to all shares
beneficially owned, subject to community property laws where
applicable.
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Common Percent
Shares of
Class(2)
Name and Address
Larry L. Beck (1)(2) 1,000,000 65.7
7865 South Citori Drive
Building B, No. 206
Sandy, UT 84070
James P. Evans 200,000 13.1
P.O. Box 935
Wells, Nevada 89835
Valerie King (2) 100,000 6.6
148 Cascade Drive
Sp. Creek, Nevada 89815
Douglas E. Madden 200,000 13.1
444 Elm street
Elko, Nevada 89801
All Executive officers and Directors 1,000,000 65.7
as a Group (1 person)
(1) Mr. Beck is the sole officer and director of the Company.
(2) Valerie King is the spouse of Larry L. Beck. Accordingly,
Mr. Beck and Ms. King may be deemed to have shared voting and
investment control with respect to the shares owned by them.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS
Directors and Officers
The following table sets forth the names, ages, and positions
with the Company for each of the directors and officers of the
Company.
Name Age Positions (1) Since
Larry L. Beck 46 President, Secretary, 1998
Treasurer and Director
All executive officers are elected by the Board and hold office
until the next Annual Meeting of stockholders and until their
successors are elected and qualify.
The following is information on the business experience of each
director and officer.
Larry L. Beck is the founder of the Company and has served as
President, Secretary, Treasurer and Director since its
incorporation in April 1998. Mr. Beck has over 20 years
experience in various aspects of the retail jewelry business
including purchasing, merchandising, appraising, managing and
restructuring. From March 1996 through December 1997, Mr. Beck
was involved in sales and jewelry appraising for Fortier
Jewelers, a chain of jewelry stores in Utah. From September 1994
through February 1996 Mr. Beck managed the Shane Company, a
wholesale jewelry store in Utah. Mr. Beck helped open the first
store and participated in its growth to over $3,000,000 in sales.
From April 1993 to September 1994 Mr. Beck was a consultant for
Silverman Retail Consultants, a consulting firm that assisted
distressed retailers in the area of closeouts, bankruptcies,
acquisitions and marketing.
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ITEM 6. EXECUTIVE COMPENSATION
The Company has no arrangement for compensating any of its
executive officers. At such time as the results of operations of
the Company improve, it is expected the Company will implement
compensation arrangements for its executive officers.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On April 14, 1998, the Company issued 1,000,000 shares of common
stock, par value $0.001 per share, to Larry L. Beck, in
consideration of services rendered and other consideration
received in connection with the formation of the Company.
ITEM 8. LEGAL PROCEEDINGS
The Company is not a party to any material pending legal
proceedings, and to the best of its knowledge, no such
proceedings by or against the Company have been threatened.
ITEM 9. MARKET FOR COMMON EQUITY AND OTHER STOCKHOLDER MATTERS
There is no established trading market for the Company's common
stock. The Company has no outstanding options or warrants to
purchase, or securities convertible into, common equity.
Of the 1,521,750 shares of common stock outstanding, 1,500,000
shares ("Control Shares"), are held by officers, directors, and
10% stockholders of the Company, and are subject to restrictions
on resale under Rule 144 promulgated under the Securities Act of
1933. Control Shares may be sold subject to complying with all
of the terms and conditions of Rule 144, except the one-year
holding period which has been satisfied.
Since its inception, no dividends have been paid on the Company's
common stock. The Company intends to retain any earnings for use
in its business activities, so it is not expected that any
dividends on the common stock will be declared and paid in the
foreseeable future.
At May 21, 1999, there were approximately 31 holders of record of
the Company's Common Stock.
ITEM 10. RECENT SALES OF UNREGISTERED SECURITIES
Immediately following organization of the Company in April 1998,
it issued 1,000,000 shares of its common stock to its sole
officer and director in connection with the formation of the
Company. No underwriter or broker was involved in the offering,
and no commissions were paid on the sale of the shares. The
shares were offered and sold in reliance on the exemption set
forth in Section 4(2) of the Securities Act of 1933.
In connection with for formation of the Company, it issued on
April 14, 1998, 500,000 shares of common stock at a price of
$0.001 per share or a total of $500. The shares were sold in
reliance on Rule 504 of Regulation D promulgated under the
Securities Act of 1933. The offering was completed on or about
June 1, 1998, with all offered shares sold at a gross purchase
price of $500. No underwriter or broker was involved in the
offering, and no commissions were paid on the sale of the shares.
The purchasers of the shares are as follows:
James P. Evans 200,000 shares
Valerie King 100,000 shares
Douglas E. Madden 200,000 shares
On June 1, 1998, the Company commenced a placement of 100,000
shares of common stock at a price of $1.00 per share in reliance
on Rule 504 of Regulation D promulgated under the Securities Act
of 1933. The offering was completed on or about April 2, 1999,
with 21,750 shares sold at a gross purchase price of $21,750. No
underwriter or broker was involved in the offering, and no
6
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commissions were paid on the sale of the shares. The purchasers
of the shares are as follows:
John Banas 500 shares
Gordon E. Beckstead 500 shares
John Bradley 500 shares
Stephen Bushansky 2,000 shares
Bill M. Conrad 500 shares
John K. Delisa, Jr. 500 shares
Elvena Inc. 5,000 shares
Jeffrey Falke 150 shares
William Falke 150 shares
Debra Gellar 1,000 shares
Eugene Gellar 1,000 shares
Douglas J. and Donna K. Kilmas 500 shares
Kuno Laren 500 shares
Michael A. Linsky 500 shares
John B. Lowy 200 shares
Debra A. Marsalisi 500 shares
Fay M. Matsukage 500 shares
Raymond E. and Tamara D. McElhaney 500 shares
OMI Trust 750 shares
Steven and Tracie Pollack 750 shares
Tracie Pollack 750 shares
Barry Potter 500 shares
Stephen Richards 2,000 shares
Andrew D. Russ 500 shares
Hal Schoenfeld 500 shares
Charlie Trench 500 shares
Michael L. Valo 500 shares
ITEM 11. DESCRIPTION OF SECURITIES
The Company is authorized to issue 20,000,000 shares of common
stock, par value $0.001 per share, of which 1,521,750 shares are
issued and outstanding. Holders of common stock are entitled to
one vote per share on each matter submitted to a vote at any
meeting of stockholders. Shares of common stock do not carry
cumulative voting rights and, therefore, holders of a majority of
the outstanding shares of common stock will be able to elect the
entire board of directors, and, if they do so, minority
stockholders would not be able to elect any members to the board
of directors. The Company's board of directors has authority,
without action by the Company's stockholders, to issue all or any
portion of the authorized but unissued shares of common stock,
which would reduce the percentage ownership in the Company of its
stockholders and which may dilute the book value of the common
stock. Stockholders of the Company have no pre-emptive rights to
acquire additional shares of common stock. 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 has
not paid dividends on its common stock and does not anticipate
that it will pay dividends in the foreseeable future.
The Company is authorized to issue 5,000,000 shares of preferred
stock, par value $0.001, none of which are issued and
outstanding. The Company currently has no plans to issue any
preferred stock. The Company's board of directors has authority,
without action by the shareholders, to issue all or any portion
of the unissued preferred stock in one or more series and to
determine the voting rights, preferences as to dividends and
liquidation, conversion rights and other rights of such series.
The preferred stock, if and when issued, may carry rights
superior to those of the common stock.
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ITEM 12. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 78.751 of the Nevada Revised Statutes provides in
relevant part as follows:
(1) A corporation may indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending,
or completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative except an action by or
in the right of the corporation, by reason of the fact that he is
or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other
enterprise, against expenses, including attorneys' fees,
judgments, fines, and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit,
or proceeding if he acted in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests
of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit, or proceeding by
judgment, order, settlement, conviction, or on a plea of nolo
contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to
the best interests of the corporation, and that, with respect to
any criminal action or proceeding, he had reasonable cause to
believe that his conduct was unlawful.
(2) A corporation may indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending,
or completed action or suit by or in the right of the corporation
to procure a judgment in its favor by reason of the fact that he
is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other
enterprise against expenses, including amounts paid in settlement
and attorneys' fees actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit
if he acted in good faith and in a manner he reasonably believed
to be in or not opposed to the best interests of the corporation.
Indemnification may not be made for any claim, issue, or matter
as to which such person shall have been adjudged to be liable for
negligence or misconduct in the performance of his duty to the
corporation unless and only to the extent that the court in which
such action or suit was brought shall determine on application
that, despite the adjudication of liability but in view of all
circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall
deem proper.
(3) To the extent that a director, officer, employee, or agent
of a corporation has been successful on the merits or otherwise
in defense of any action, suit, or proceeding referred to in
subsections 1 and 2, or in defense of any claim, issue, or matter
therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in
connection therewith.
The Company's articles of incorporation provide that no director
or officer of the Company shall be personally liable to the
Company to the extent provided in the Nevada Revised Statutes.
The Nevada Revised Statutes provide that no officer or director
of a corporation shall be personally liable to the corporation or
any of its stockholders for damages for breach of fiduciary duty
as a director or officer involving any act or omission of any
such officer or director, except for acts or omissions involving
intentional misconduct, fraud or a knowing violation of law, or
the payments of dividends in violation of Section 78.300 of the
Nevada Revised Statutes.
ITEM 13. FINANCIAL STATEMENTS
The financial statements of the Company appear at the end of
this report beginning with the Index to Financial Statements on
page F-1.
ITEM 14. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
There have been no changes in or disagreements with accountants
since the Company's organization.
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ITEM 15. FINANCIAL STATEMENTS AND EXHIBITS
The following financial statements of the Company appear at the
end of this registration statement beginning with the Index to
Financial Statements on page F-1.
Independent Auditors' Report
Balance Sheets
Statement of Operations
Statement of Stockholders' Equity From Inception through December
31, 1998
Statement of Cash Flows
Notes to the Financial Statements
Exhibits
Copies of the following documents are included as exhibits to
this report pursuant to Item 601 of Regulation S-B.
Exhibit SEC Title of Document Page
No. Ref.
No.
1 (3)(i) Articles of Incorporation, as amended E-1
2 (3)(ii) By-Laws E-3
3 (27) Financial Data Schedules *
* The Financial Data Schedule is presented only in the
electronic filing with the Securities and Exchange Commission.
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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.
BECK & CO.
Date: July 5, 1999 By: /s/ Larry L. Beck, President
In accordance with the Exchange Act, this registration statement
has been signed by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Dated: July 5, 1999 /s/ Larry L. Beck, Director
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BECK & CO.
(A Development Stage Company)
Financial Statements
March 31, 1999 and December 31, 1998
C O N T E N T S
Independent Auditors' Report F-2
Balance Sheets F-3
Statements of Operations F-4
Statements of Stockholders' Equity F-5
Statements of Cash Flows F-7
Notes to the Financial Statements F-8
F-1
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INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
Beck & Co.
(A Development Stage Company)
Sandy, Utah
We have audited the accompanying balance sheets of Beck & Co.
(a development stage company) as of March 31, 1999 and
December 31, 1998 and the related statements of operations,
stockholders' equity and cash flows for the three months
ended March 31, 1999, and from inception on April 14, 1998
through December 31, 1998 and through March 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 audits 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 referred to above
present fairly, in all material respects, the financial
position of Beck & Co. (a development stage company) as of
March 31, 1999 and December 31, 1998 and the results of its
operations and its cash flows for the three months ended
March 31, 1999, and from inception on April 14, 1998 through
December 31, 1998 and through March 31, 1999 in conformity
with generally accepted accounting principles.
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern.
As discussed in Note 3 to the financial statements, the
Company is a development stage company with no significant
operating results to date, which raises substantial doubt
about its ability to continue as a going concern.
Management's plans in regard to these matters are also
described in Note 3. The financial statements do not include
any adjustments that might result form the outcome of the
uncertainty.
Jones, Jensen & Company
Salt Lake City, Utah
June 24, 1999
F-2
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BECK & CO.
(A Development Stage Company)
Balance Sheets
ASSETS
March 31, December 31,
1999 1998
CURRENT ASSETS
Cash $ 16,774 $2,737
Total Current Assets 16,774 2,737
TOTAL ASSETS $ 16,774 $2,737
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Note payable - related party (Note 4) $ 2,500 $1,000
Total Current Liabilities 2,500 1,000
STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par value: 5,000,000
shares authorized; -0- and -0- shares issued and
outstanding, respectively - -
Common stock, $0.001 par value: 20,000,000
shares authorized; 1,521,750 and 1,507,000 shares
issued and outstanding, respectively 1,522 1,507
Additional paid-in capital 21,728 6,993
Deficit accumulated during the development stage (8,976) (6,763)
Total Stockholders' Equity 14,274 1,737
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 16,774 $ 2,737
The accompanying notes are an integral part of these financial statements.
F-3
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BECK & CO.
(A Development Stage Company)
Statements of Operations
For the
Three Months From Inception on
Ended April 14, 1998 Through
March 31, December 31, March 31,
1999 1998 1999
NET SALES $ 185 $ 13,229 $ 13,414
COST OF SALES 28 8,940 8,968
GROSS PROFIT 157 4,289 4,446
EXPENSES
General and administrative 2,370 11,052 13,422
Total Expenses 2,370 11,052 13,422
NET LOSS $ (2,213) $ (6,763) $ (8,976)
BASIC LOSS PER SHARE $ (0.00) $ (0.00)
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 1,507,000 1,480,492
The accompanying notes are an integral part of these financial statements.
F-4
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BECK & CO.
(A Development Stage Company)
Statements of Stockholders' Equity
From inception on April 14, 1998 through March 31, 1999
Deficit
Accumulated
Additional During the
Common Stock Paid-in
Development
Shares Amount Capital Stage
Balance at inception on
April 14, 1998 - $ - $ - $ -
Issuance of common stock for
services at $0.001 per share 1,000,000 1,000 - -
Issuance of common stock for
cash at $0.001 per share 500,000 500 - -
Issuance of common stock for
cash at $1.00 per share 7,000 7 6,993 -
Net loss from inception on
April 14, 1998 through
December 31, 1998 - - - (6,763)
Balance, December 31, 1998 1,507,000 1,507 6,993 (6,763)
Issuance of common stock for
cash at $1.00 per share 14,750 15 14,735 -
Net loss for the three months
ended March 31, 1999 - - - (2,213)
Balance, March 31, 1999 1,521,750 $1,522 $ 21,728 $ (8,976)
The accompanying notes are an integral part of these financial statements.
F-5
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<TABLE>
<CAPTION>
BECK & CO.
(A Development Stage Company)
Statements of Cash Flows
For the
Three Months From Inception on
Ended April 14, 1998 Through
March 31, December 31, March 31,
1999 1998 1999
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $ (2,213) $ (6,763) $ (8,976)
Adjustments to reconcile net loss to net cash
used by operating activities:
Common stock issued for services - 1,000 1,000
Increase in accounts payable 1,500 1,000 2,500
Net Cash Used by Operating Activities (713) (4,763) (5,476)
CASH FLOWS FROM INVESTING
ACTIVITIES: - - -
CASH FLOWS FROM FINANCING
ACTIVITIES:
Common stock issued for cash 14,750 7,500 22,250
Net Cash Provided by Financing
Activities 14,750 7,500 22,250
NET INCREASE (DECREASE) IN CASH 14,037 2,737 16,774
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 2,737 - -
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 16,774 $ 2,737 $16,774
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest paid $ - $ - $ -
Income taxes paid $ - $ - $ -
SCHEDULE OF NON-CASH FINANCING ACTIVITIES:
Common stock issued for services $ - $ 1,000 $ 1,000
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-6
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BECK & CO.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 1999 and December 31, 1998
NOTE 1 - NATURE OF ORGANIZATION
The financial statements presented are those of Beck &
Co. (the Company). The Company was organized under the
laws of the State of Nevada on April 14, 1998. The
Company was organized for the purpose of offering mail
order and internet retail jewelry sales.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Accounting Method
The financial statements are prepared using the accrual
method of accounting. The Company has elected a December
31 year end.
b. Provision for Taxes
At March 31, 1999, the Company has net operating loss
carryforwards of approximately $9,000 that may be offset
against future taxable income through 2013. No tax
benefit has been reported in the financial statements
because the Company believes there is a 50% or greater
chance the carryforwards will expire unused.
Accordingly, the potential tax benefits of the loss
carryforwards are offset by a valuation allowance of the
same amount.
c. Use of Estimates
The preparation of financial statements in conformity
with generally accepted accounting principles requires
management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and
disclosure 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 estimates.
d. Cash and Cash Equivalents
The Company considers all highly liquid investments with
a maturity of three months or less when purchased to be
cash equivalents.
e. Basic Loss Per Share
The computation of basic loss per share of common stock
is based on the weighted average number of shares
outstanding during the period of the financial
statements.
F-7
<PAGE>
BECK & CO.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 1999 and December 31, 1998
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using
generally accepted accounting principles applicable to a
going concern which contemplates the realization of
assets and liquidation of liabilities in the normal
course of business. However, the Company does not have
significant cash or other material assets, nor does it
have an established source of revenues sufficient to
cover its operating costs and to allow it to continue as
a going concern. It is the intent of the Company to
complete a limited offering of its common stock. In the
interim, shareholders of the Company have committed to
meeting its minimal operating expenses.
NOTE 4 - NOTE PAYABLE - RELATED PARTY
As of March 31, 1999 and December 31, 1998, the Company
owed a related party $2,500 and $1,000, respectively.
The note is due in full on March 31, 2000 and will accrue
interest at 10% per annum beginning April 1, 1999.
F-8
Exhibit 1
Beck & Co.
Form 10-SB
ARTICLES OF INCORPORATION
OF
BECK & CO.
FIRST. The name of the Company shall be Beck & Co.
SECOND. The resident agent and registered office located
within the State of Nevada is:
Larry L. Beck
1010 College Avenue, #2
Elko, Nevada 89801
THIRD. The purpose for which the corporation is formed is
for the purpose of transacting any lawful business, or promoting
or conducting any legitimate object or purpose, under and subject
to the laws of the State of Nevada.
FOURTH. The stock of the corporation is divide into two
classes: (1) Common Stock in the amount of Twenty Million
(20,000,000) shares having a par value of $0.001 each; and (2)
Preferred Stock in the amount of (5,000,000) shares having a par
value of $0.001 each. The Board of Directors shall have the
authority, by resolution or resolutions, (1) to divide the
Preferred Stock into more than one class of stock or more than
one series of any class; (2) to establish and fix the
distinguishing designation of each such series and the number of
shares thereof, which number, by like action of the Board of
Directors, from time to time thereafter, may be increased, except
when otherwise provided by the Board of Directors in creating
such series, or may be decreased, but not below the number of
shares thereof then outstanding; and (3) within the limitations
of applicable law of the State of Nevada or as otherwise set
forth in this Article, to fix and determine the relative voting
powers, designations, preferences, limitations, restrictions and
relative rights of the various classes or stock or series thereof
and the qualifications, limitations or restrictions such rights
of each series so established prior to the issuance thereof.
There shall be no cumulative voting by shareholders.
FIFTH. The corporation, by action of its directors, and
without action by its shareholders, may purchase its own shares
in accordance with the provisions of the Nevada Revised Statutes.
Such purchases may be made either in the open market or at a
public or private sale, in such manner and amounts, from such
holder or holders of outstanding shares of the corporation and at
such prices as the directors shall from time to time determine.
SIXTH. No holder of shares of the corporation of any class,
as such, shall have any preemptive right to purchase or subscribe
for shares of the corporation, of any class, whether now or
hereafter authorized.
SEVENTH. The Board of Directors shall consist of no fewer
than one member and no more than seven members. The initial
Board of Directors will consist of the following member(s) (with
their address indicated) as follows:
Larry L. Beck
1010 College Avenue, #2
Elko, Nevada 89801
EIGHTH. No officer or director shall be personally liable
to the corporation or its shareholders for money damages except
as provided pursuant to the Nevada Revised Statutes.
NINTH. The name and address of the Incorporator of the
corporation is as follows:
Tammy Gehring
2133 East 9400 South, Suite 151
Sandy, Utah 84093
IN WITNESS WHEREOF, these Articles of Incorporation are
hereby executed this 6th day of April, 1998.
/s/ Tammy Gehring, Incorporator
NOTARIZATION OF SIGNATURE OF THE INCORPORATOR
State of Utah )
)
County of Salt Lake )
On this 6th day of April, 1998 before me, Sheri Hayward, a notary
public, personally appeared Tammy Gehring, the person whose name
is subscribed to this instrument and who has acknowledged that
he/she executed the same as the Incorporator of Beck & Co.
/s/
Notary Public
4/28/01
My Commission Expires
Exhibit 2
Beck & Co.
Form 10-SB
BY-LAWS OF
BECK & CO.
ARTICLE I
SHAREHOLDERS
Section 1.01 Annual Meeting. The annual meeting of the
shareholders shall be held at such date and time as shall be
designated by the Board of Directors and stated in the notice of
the meeting or in a duly-executed waiver of notice thereof. If
the corporation shall fail to provide notice of the annual
meeting of the shareholders as set forth above, the annual
meeting of the shareholders of the corporation shall be held
during the month of November or December of each year as
determined by the Board of Directors, for the purpose of electing
directors of the corporation to serve during the ensuing year and
for the transaction of such other business as may properly come
before the meeting. If the election of the directors is not held
on the day designated herein for any annual meeting of the
shareholders, or at any adjournment thereof, the president shall
cause the election to be held at a special meeting of the
shareholders as soon thereafter as is convenient.
Section 1.02 Special Meetings. Special meetings of the
shareholders may be called by the president or the Board of
Directors and shall be called by the president at the written
request of the holders of not less than 51% of the issued and
outstanding shares of capital stock of the corporation.
All business lawfully to be transacted by the shareholders
maybe transacted at any special meeting at any adjournment
thereof. However, no business shall be acted upon at a special
meeting, except that referred to in the notice calling the
meeting, unless all of the outstanding capital stock of the
corporation is represented either in person or by proxy. Where
all of the capital stock is represented, any lawful business may
be transacted and the meeting shall be valid for all purposes.
Section 1.03 Place of Meetings. Any meeting of the
shareholders of the corporation may be held at its principal
office in the State of Nevada or such other place in or out of
the United States as the Board of Directors may designate. A
waiver of notice signed by the shareholders entitled to vote may
designate any place for the holding of such meeting.
Section 1.04 Notice of Meetings.
(a) The secretary shall sign and deliver to all
shareholders of record written or printed notice of any
meeting at least ten (10) days, but not more than sixty (60)
days, before the date of such meeting; which notice shall
state the place, date and time of the meeting, the general
nature of the business to be transacted, and, in the case of
any meeting at which directors are to be elected, the names
of nominees, if any, to be presented for election.
(b) In the case of any meeting, any proper business
may be presented for action, except that the following items
shall be valid only if the general nature of the proposal
is stated in the notice or written waiver of notice:
(1) Action with respect to any contract or
transaction between the corporation and one or more of
its directors or another firm, association, or
corporation in which one or more of its directors has a
material financial interest;
(2) Adoption of amendments to the Articles of
Incorporation; or
(3) Action with respect to the merger,
consolidation, reorganization, partial or complete
liquidation, or dissolution of the corporation.
(c) The notice shall be personally delivered or mailed
by first class mail to each shareholder of record at the
last known address thereof, as the same appears on the books
of the corporation, and the giving of such notice shall be
deemed delivered the date the same is deposited in the
United States mail, postage prepaid. If the address of any
shareholder does not appear upon the books of the
corporation, it will be sufficient to address any notice to
such shareholder at the principal office of the corporation.
(d) The written certificate of the person calling any
meeting, duly sworn, setting forth the substance of the
notice, the time and place the notice was mailed or
personally delivered to the several shareholders, and the
addresses to which the notice was mailed shall be prima
facie evidence of the manner and fact of giving such notice.
Section 1.05 Waiver of Notice. If all of the shareholders
of the corporation shall waive notice of a meeting, no notice
shall be required, and, whenever all of the shareholders shall
meet in person or by proxy, such meeting shall be valid for all
purposes without call or notice, and at such meeting any
corporate action may be taken.
Section 1.06 Determination of Shareholders of Record.
(a) The Board of Directors may at any time fix a
future date as a record date for the determination of the
shareholders entitled to notice of any meeting or to vote or
entitled to receive payment of any dividend or other
distribution or allotment of any rights or entitled to
exercise any rights in respect of any other lawful action.
The record date so fixed shall not be more than sixty (60)
days prior to the date of such meeting nor more than sixty
(60) days prior to any other action. When a record date is
so fixed, only shareholders of record on that date are
entitled to notice of and to vote at the meeting or to
receive the dividend, distribution or allotment of rights,
or to exercise their rights, as the case may be,
notwithstanding any transfer of any shares on the books of
the corporation after the record date.
(b) If no record date is fixed by the Board of
Directors, then (1) the record date for determining
shareholders entitled to notice of or to vote at a meeting
of shareholders shall be at the close of business on the
business day next preceding the day on which notice is
given or, if notice is waived, at the close of business on
the day next preceding the day on which the meeting is held;
(2) the record date for determining shareholders entitled to
give consent to corporate action in writing without a
meeting, when no prior action by the Board of Directors is
necessary, shall be the day on which written consent is
given; and (3) the record date for determining shareholders
for any other purpose shall be at the close of business on
the day on which the Board of Directors adopts the
resolution relating thereto, or the sixtieth (60th) day
prior to the date of such other action, whichever is later.
Section 1.07 Quorum: Adjourned Meetings.
(a) At any meeting of the shareholders, a majority of
the issued and outstanding shares of the corporation
represented in person or by proxy, shall constitute a
quorum.
(b) If less than a majority of the issued and
outstanding shares are represented, a majority of shares so
represented may adjourn from time to time at the meeting,
until holders of the amount of stock required to constitute
a quorum shall be in attendance. At any such adjourned
meeting at which a quorum shall be present, any business may
be transacted which might have been transacted as originally
called. When a shareholders' meeting is adjourned to
another time or place, notice need not be given of the
adjourned meeting if the time and place thereof are
announced at the meeting at which the adjournment is taken,
unless the adjournment is for more than ten (10) days in
which event notice thereof shall be given.
Section 1.08 Voting.
(a) Each shareholder of record, such shareholder's
duly authorized proxy or attorney-in-fact shall be entitled
to one (1) vote for each share of stock standing registered
in such shareholder's name on the books of the corporation
on the record date.
(b) Except as otherwise provided herein, all votes
with respect to shares standing in the name of an individual
on the record date (included pledged shares) shall be cast
only by that individual or such individual's duly authorized
proxy or attorney-in-fact. With respect to shares held by a
representative of the estate of a deceased shareholder,
guardian, conservator, custodian or trustee, votes may be
cast by such holder upon proof of capacity, even though the
shares do not stand in the name of such holder. In the case
of shares under the control of a receiver, the receiver may
cast votes carried by such shares even though the shares do
not stand in the name of the receiver provided that the
order of the court of competent jurisdiction which appoints
the receiver contains. the authority to cast votes carried
by such shares. If shares stand in the name of a minor,
votes may be cast only by the duly-appointed guardian of the
estate of such minor if such guardian has provided the
corporation with written notice and proof of such
appointment.
(c) With respect to shares standing in the name of a
corporation on the record date, votes may be cast by such
officer or agents as the By-Laws of such corporation
prescribe or, in the absence of an applicable by-law
provision, by such person as may be appointed by resolution
of the Board of Directors of such corporation. In the event
no person is so appointed, such votes of the corporation may
be cast by any person (including the officer making the
authorization) authorized to do so by the Chairman of the
Board of Directors, president or any Vice president of such
corporation.
(d) Notwithstanding anything to the contrary herein
contained, no votes may be cast by shares owned by this
corporation or its subsidiaries, if any. If shares are held
by this corporation or its subsidiaries, if any, in a
fiduciary capacity, no votes shall be cast with respect
thereto on any matter except to the extent that the
beneficial owner thereof possesses and exercises either a
right to vote or to give the corporation holding the same
binding instructions on how to vote.
(e) With respect to shares standing in the name of two
or more persons, whether fiduciaries, members of a
partnership, joint tenants, tenants in common, husband and
wife as community property, tenants by the entirety, voting
trustees, persons entitled to vote under a shareholder
voting agreement or otherwise and shares held by two or more
persons (including proxy holders) having the same fiduciary
relationship respect in the same shares, votes may be cast
in the following manner:
(1) If only one such person votes, the votes of
such person binds all.
(2) If more than one person casts votes, the act
of the majority so voting binds all.
(3) If more than one person casts votes, but the
vote is evenly split on a particular matter, the votes
shall be deemed cast proportionately as split.
(f) Any holder of shares entitled to vote on any
matter may cast a portion of the votes in favor of such
matter and refrain from casting the remaining votes or cast
the same against the proposal, except in the case of
elections of directors. If such holder entitled to vote
fails to specify the number of affirmative votes, it will be
conclusively presumed that the holder is casting affirmative
votes with respect to all shares held.
(g) If a quorum is present, the affirmative vote of
holders of a majority of the shares represented at the
meeting and entitled to vote on any matter shall be the act
of the shareholders, unless a vote of greater number or
voting by classes is required by the laws of the State of
Nevada, the Articles of Incorporation and these By-Laws.
Section 1.09 Proxies. At any meeting of shareholders, any
holder of shares entitled to vote may authorize another person or
persons to vote by proxy with respect to the shares held by an
instrument in writing and subscribed to by the holder of such
shares entitled to vote. No proxy shall be valid after the
expiration of six (6) months from the date of execution thereof,
unless coupled with an interest or unless otherwise specified in
the proxy. In no event shall the term of a proxy exceed seven
(7) years from the date of its execution. Every proxy shall
continue in full force and effect until its expiration or
revocation. Revocation may be effected by filing an instrument
revoking the same or a duly-executed proxy bearing a later date
with the secretary of the corporation.
Section 1.10 Order of Business. At the annual shareholders
meeting, the regular order of business shall be as follows:
(1) Determination of shareholders present and
existence of quorum;
(2) Reading and approval of the minutes of the
previous meeting or meetings;
(3) Reports of the Board of Directors, the
president, treasurer and secretary of the corporation,
in the order named;
(4) Reports of committee;
(5) Election of directors;
(6) Unfinished business;
(7) New business;
(8) Adjournment.
Section 1.11 Absentees Consent to Meetings. Transactions
of any meeting of the shareholders are as valid as though had at
a meeting duly-held after regular call and notice if a quorum is
present, either in person or by proxy, and if, either before or
after the meeting, each of the persons entitled to vote, not
present in person or by proxy (and those who, although present,
either object at the beginning of the meeting to the transaction
of any business because the meeting has not been lawfully called
or convened or expressly object at the meeting to the
consideration of matters not included in the notice which are
legally required to be included therein), signs a written waiver
of notice and/or consent to the holding of the meeting or an
approval of the minutes thereof. All such waivers, consents, and
approvals shall be filed with the corporate records and made a
part of the minutes of the meeting. Attendance of a person at a
meeting shall constitute a waiver of notice of such meeting,
except when the person objects at the beginning of the meeting to
the transaction of any business because the meeting is not
lawfully called or convened and except that attendance at a
meeting is not a waiver of any right to object to the
consideration of matters not included in the notice if such
objection is expressly made at the beginning. Neither the
business to be transacted at nor the purpose of any regular or
special meeting of shareholders need be specified in any written
waiver of notice, except as otherwise provided in Section 1.04(b)
of these By-Laws.
Section 1.12 Action Without Meeting. Any action which may
be taken by the vote of the shareholders at a meeting may be
taken without a meeting if consented to by the holders of a
majority of the shares entitled to vote or such greater
proportion as may be required by the laws of the State of Nevada,
the Articles of Incorporation, or these By-Laws. Whenever action
is taken by written consent, a meeting of shareholders needs not
be called or noticed.
ARTICLE II
DIRECTORS
Section 2.01 Number, Tenure and Qualification. Except as
otherwise provided herein, the Board of Directors of the
corporation shall consist of at least one (1) but no more than
seven (7) persons, who shall be elected at the annual meeting of
the shareholders of the corporation and who shall hold office for
one (1) year or until their successors are elected and qualify.
Section 2.02 Resignation. Any director may resign
effective upon giving written notice to the chairman of the Board
of Directors, the president, or the secretary of the corporation,
unless the notice specifies a later time for effectiveness of
such resignation. If the Board of Directors accepts the
resignation of a director tendered to take effect at a future
date, the Board or the shareholders may elect a successor to take
office when the resignation becomes effective.
Section 2.03 Reduction in Number. No reduction of the
number of directors shall have the effect of removing any
director prior to the expiration of his term of office.
Section 2.04 Removal.
(a) The Board of Directors or the shareholders of the
corporation, by a majority vote, may declare vacant the
office of a director who has been declared incompetent by an
order of a court of competent jurisdiction or convicted of a
felony.
Section 2.05 Vacancies.
(a) A vacancy in the Board of Directors because of
death, resignation, removal, change in number of directors,
or otherwise may be filled by the shareholders at any
regular or special meeting or any adjourned meeting thereof
or the remaining director(s) by the affirmative vote of a
majority thereof. A Board of Directors consisting of less
than the maximum number authorized in Section 2.01 of
ARTICLE II constitutes vacancies on the Board of Directors
for purposes of this paragraph and may be filled as set
forth above including by the election of a majority. of the
remaining directors. Each successor so elected shalt hold
office until the next annual meeting of shareholders or
until a successor shall have been duly-elected and
qualified.
(b) If, after the filling of any vacancy by the
directors, the directors then in office who have been
elected by the shareholders shall constitute less than a
majority of the directors then in office, any holder or
holders of an aggregate of five percent (5%) or more of the
total number of shares entitled to vote may call a special
meeting of shareholders to be held to elect the entire Board
of Directors. The term of office of any director shall
terminate upon such election of a successor.
Section 2.06 Regular Meetings. Immediately following the
adjournment of, and at the same place as, the annual meeting of
the shareholders, the Board of Directors, including directors
newly elected, shall hold its annual meeting without notice,
other than this provision, to elect officers of the corporation
and to transact such further business as may be necessary or
appropriate. The Board of Directors may provide by resolution
the place, date and hour for holding additional regular meetings.
Section 2.07 Special Meetings. Special meetings of the
Board of Directors may be called by the chairman and shall be
called by the chairman upon the request of any one (1) director
or the president of the corporation.
Section 2.08 Place of Meetings. Any meeting of the
directors of the corporation may be held at its principal office
in the State of Nevada, or at such other place in or out of the
United States as the Board of Directors may designate. A waiver
or notice signed by the directors may designate any place for the
holding of such meeting.
Section 2.09 Notice of Meetings. Except as otherwise
provided in Section 2.06, the chairman shall deliver to all
directors written or printed notice of any special meeting, at
least three (3) days before the date of such meeting, by delivery
of such notice personally or mailing such notice first class
mail, or by telegram. If mailed, the notice shall be deemed
delivered two (2) business days following the date the same is
deposited in the United States mail, postage prepaid. Any
director may waive notice of any meeting, and the attendance of a
director at a meeting shall constitute a waiver of notice of such
meeting, unless such attendance is for the express purpose of
objecting to the transaction of business threat because the
meeting is not properly called or convened.
Section 2.10 Quorum: Adjourned Meetings.
(a) A majority of the Board of Directors in office
shall constitute a quorum.
(b) At any meeting of the Board of Directors where a
quorum is not present, a majority of those present may
adjourn, from time to time, until a quorum is present, and
no notice of such adjournment shall be required. At any
adjourned meeting where a quorum is present, any business
may be transacted which could have been transacted at the
meeting originally called.
Section 2.ll Action Without Meeting. Any action required
or permitted to be taken at any meeting of the Board of Directors
on any committee thereof may be taken without a meeting if a
written consent thereto is signed by all of the members of the
Board of Directors or of such committee. Such written consent or
consents shall be filed with the minutes of the proceedings of
the Board of Directors or committee. Such action by written
consent shall have the same force and effect as the unanimous
vote of the Board of Directors or committee.
Section 2.12 Telephonic Meetings. Meetings of the Board of
Directors may be held through the use of a conference telephone
or similar communications equipment so long as all members
participating in such meeting can hear one another at the time of
such meeting. Participation in such a meeting constitutes
presence in person at such meeting.
Section 2.13 Board Decisions. The affirmative vote of a
majority of the directors present at a meeting at which a quorum
is present shall be the act of the Board of Directors.
Section 2.14 Powers and Duties.
(a) Except as otherwise provided in the Articles of
Incorporation or the laws of the State of Nevada, the Board
of Directors is invested with the complete and unrestrained
authority to manage the affairs of the corporation, and is
authorized to exercise for such purpose as the general agent
of the corporation, its entire corporate authority in such
manner as it sees fit. The Board of Directors may delegate
any of its authority to manage, control or conduct the
current business of the corporation to any standing or
special committee or to any officer or agent and to appoint
any persons to be agents of the corporation with such
powers, including the power to sub-delegate, and upon such
terms as may be deemed fit.
(b) The Board of Directors shall present to the
shareholders at annual meetings of the shareholders, and
when called for by a majority vote of the shareholders at a
special meeting of the shareholders, a full and clear
statement of the condition of the corporation, and shall, at
request, furnish each of the shareholders with a true copy
thereof.
(c) The Board of Directors, in its discretion, may
submit any contract or act for approval or ratification at
any annual meeting of the shareholders or any special
meeting properly called for the purpose of considering any
such contract or act, provided a quorum is present. The
contract or act shall be valid and binding upon the
corporation and upon all the shareholders thereof, if
approved and ratified by the affirmative vote of a majority
of the shareholders at such meeting.
(d) In furtherance and not in limitation of the powers
conferred by the laws of the State of Nevada, the Board of
Directors is expressly authorized and empowered to issue
stock of the Corporation for money, property, services
rendered, labor performed, cash advanced, acquisitions for
other corporations or for any other assets of value in
accordance with the action of the Board of Directors without
vote or consent of the shareholders and the judgment of the
Board of Directors as to the value received and in return
therefore shall be conclusive and said stock, when issued,
shall be fully-paid and non-assessable.
(e) The Board of Directors, in its discretion, may
borrow money and incur indebtedness for the purposes of the
Corporation, and to cause to be executed and delivered
therefore, in the corporate name, promissory notes, bonds,
debentures, deeds of trust, mortgages, pledges,
hypothecation, or other evidences of debt and securities
therefore.
Section 2.15 Compensation. The directors shall be allowed
and paid all necessary expenses incurred in attending any
meetings of the Board, but shall not receive any compensation for
their services as directors until such time as the corporation is
able to declare and pay dividends on its capital stock
Section 2.16 Board Officers.
(a) At its annual meeting, the Board of Directors
shall elect, from among its members, a chairman to preside
at the meetings of the Board of Directors. The Board of
Directors may also elect such other board officers and for
such term as it may, from time to time, determine advisable.
(b) Any vacancy in any board office because of death,
resignation, removal or otherwise may be filled by the Board
of Directors for the unexpired portion of the term of such
office.
Section 2.17 Order of Business. The order of business at
any meeting of the Board of Directors shall be as follows:
(1) Determination of members present and existence
of quorum;
(2) Reading and approval of the minutes of any
previous meeting or meetings;
(3) Reports of officers and committeemen;
(4) Election of officers;
(5) Unfinished business;
(6) New business;
(7) Adjournment.
ARTICLE III
OFFICERS
Section 3.01 Election. The Board of Directors, at its
first meeting following the annual meeting of shareholders, shall
elect a president, a secretary and a treasurer to hold office for
one (1) year next coming and until their successors are elected
and qualify. Any person may hold two or more offices. The Board
of Directors may, from time to time, by resolution, appoint one
or more vice presidents, assistant secretaries, assistant
treasurers and transfer agents of the corporation as it may deem
advisable; prescribe their duties; and fix their compensation.
Section. 3.02 Removal; Resignation. Any officer or agent
elected or appointed by the Board of Directors may be removed by
it whenever, in its judgment, the best interest of the
corporation would be served thereby. Any officer may resign at
any time upon written notice to the corporation without prejudice
to the rights, if any, of the corporation under any contract to
which there signing officer is a party.
Section 3.03 Vacancies. Any vacancy in any office because
of death, resignation, removal, or otherwise may be filled by the
Board of Directors for the unexpired portion of the term of such
office.
Section 3.04 President. The president shall be the general
manager and executive officer of the corporation, subject to the
supervision and control of the Board of Directors, and shall
direct the corporate affairs, with full power to execute all
resolutions and orders of the Board of Directors not especially
entrusted to some other officer of the corporation. The president
shall preside at all meetings of the shareholders and shall sign
the certificates of stock issued by the corporation, and shall
perform such other duties as shall be prescribed by the Board of
Directors.
Unless otherwise ordered by the Board of Directors, the
president shall have full power and authority on behalf of the
corporation to attend and to act and to vote at any meetings of
the shareholders of any corporation in which the corporation may
hold stock and, at any such meetings, shall possess and may
exercise any and all rights and powers incident to the ownership
of such stock. The Board of Directors, by resolution from time
to time, may confer like powers on any person or persons in place
of the president to represent the corporation for these purposes.
Section 3.05 Vice President. The Board of Directors may
elect one or more vice presidents who shall be vested with all
the powers and perform all the duties of the president whenever
the president is absent or unable to act, including the signing
of the certificates of stock issued by the corporation and the
vice president shall perform such other duties as shall be
prescribed by the Board of Directors.
Section 3.06 Secretary. The secretary shall keep the
minutes of all meetings of the shareholders and the Board of
Directors in books provided for that purpose. The secretary
shall attend to the giving and service of all notices of the
corporation, may sign with the president in the name of the
corporation all contracts authorized by the Board of Directors or
appropriate committee, have the custody of the corporate seal,
shall affix the corporate seal to all certificates of stock duly
issued by the corporation, shall have charge of stock certificate
books, transfer books and stock ledgers, and such other books and
papers as the Board of Directors or appropriate committee may
direct, and shall, in general perform all duties incident to the
office of the secretary. All corporate books kept by the
secretary shall be open for examination by any director at any
reasonable time.
Section 3.07 Assistant Secretary. The Board of Directors
may appoint an. assistant secretary who shall have such powers
and perform such duties as may be prescribed for him by the
secretary of the corporation or by the Board of Directors.
Section 3.08 Treasurer. The treasurer shall be the chief
financial officer of the corporation, subject to the supervision
and control of the Board of Directors, and shall have custody of
all the funds and securities of the corporation. When necessary
or proper, the treasurer shall endorse on behalf of the
corporation for collection checks, notes and other obligations,
and shall deposit all monies to the credit of the corporation in
such bank or banks or other depository as the Board of Directors
may designate, and shall sign all receipts and vouchers for
payments made by the corporation. Unless otherwise specified by
the Board of Directors, the treasurer shall sign with the
president all bills of exchange and promissory notes of the
corporation, shall also have the care and custody of the stocks,
bonds, certificates, vouchers, evidence of debts, securities and
such other property belonging to the corporation as the Board of
Directors shall designate, and shall sign all papers required by
law, by these By-Laws or by the Board of Directors to be signed
by the treasurer. The treasurer shall enter regularly in the
books of the corporation, to be kept for that purpose, full and
accurate accounts of all monies received and paid on account of
the corporation and whenever required by the Board of Directors,
the treasurer shall render a statement of any or all accounts.
The treasurer shall.. at all reasonable times exhibit the. books
of account. to any directors of the corporation and shall perform
all acts incident to the position of treasurer subject to the
control of the Board of Directors. The treasurer shall, if
required by the Board of Directors, give a bond to the
corporation in such sum and with such security as shall be
approved by the Board of Directors for the faithful performance
of all the duties of the treasurer and for restoration to the
corporation in the event of the treasurer's death, resignation,
retirement, or removal from office, of all books, records,
papers, vouchers, money and other property belonging to the
corporation. The expense of such bond shall be borne by the
corporation.
Section 3.09 Assistant Treasurer. The Board of Directors
may appoint an assistant treasurer who shall have such powers and
perform such duties as may be prescribed by the treasurer of the
corporation or by the Board of Directors, and the Board of
Directors may require the assistant treasurer to give a bond to
the corporation in such sum and with such security as it may
approve, for the faithful performance of the duties of assistant
treasurer, and for the restoration to the corporation, in the
event of the assistant treasurer's death, resignation, retirement
or removal from office, of all books, records, papers, vouchers,
money and other property belonging to the corporation. The
expense of such bond shall be borne by the corporation.
Section 3.10 Chairman Of The Board. The Chairman of the
Board, if there be such an officer, shall, if present, preside at
all meetings of the Board, and exercise and perform such other
powers and duties as may be from time to time assigned to him by
the Board or prescribed by these Bylaws.
ARTICLE IV
CAPITAL STOCK
Section 4.01 Issuance. Shares of capital stock of the
corporation shall be issued in such manner and at such times and
upon such conditions as shall be prescribed by the Board of
Directors.
Section 4.02 Certificates. Ownership in the corporation
shall be evidenced by certificates for shares of stock in such
form as shall be prescribed by the Board of Directors, shall be
under the seal of the corporation and shall be signed by the
president or the vice president and also by the secretary or an
assistant secretary. Each certificate shall contain the name of
the record holder, the number, designation, if any, class or
series of shares represented, a statement of summary of any
applicable rights, preferences, privileges, or restrictions
thereon, and a statement that the shares are assessable, if
applicable. All certificates shall be consecutively numbered.
The name and address of the shareholder, the number of shares,
and the date of issue shall be entered on the stock transfer
books of the corporation.
Section 4.03 Surrender: Lost or Destroyed Certificates.
All certificates surrendered to the corporation, except those
representing shares of treasury stock, shall be canceled and no
new certificates shall be issued until the former certificate for
a like number of shares shall have been canceled, except that in
case of a lost, stolen, destroyed or mutilated certificate, a new
one may be issued therefor. However, any shareholder applying
for the issuance of a stock certificate in lieu of one alleged to
have been lost, stolen, destroyed or mutilated shall, prior to
the issuance of a replacement, provide the corporation with his,
her or its affidavit of the facts surrounding the loss, theft,
destruction or mutilation and an indemnity bond in an amount and
upon such terms as the treasurer, or the Board of Directors,
shall require. In no case shall the bond be in amount less than
twice the current market value of the stock and it shall
indemnify the corporation against any loss, damage, cost or
inconvenience arising as a consequence of the issuance of a
replacement certificate.
Section 4.04 Replacement Certificate. When the Articles of
Incorporation are amended in any way affecting the statements
contained in the certificates for outstanding shares of capital
stock of the corporation or it becomes desirable for any reason,
including, without limitation, the merger or consolidation of the
corporation with another corporation or the reorganization of the
corporation, to cancel any outstanding certificate for shares and
issue a new certificate therefor conforming to the rights of the
holder, the Board of Directors may order any holders of
outstanding certificates for shares to surrender and exchange the
same for new certificates within a reasonable time to be fixed by
the Board of Directors. The order may provide that a holder of
any certificate(s) ordered to be surrendered shall not be
entitled to vote, receive dividends or exercise any other rights
of shareholders until the holder has complied with the order
provided that such order operates to suspend such rights only
after notice and until compliance.
Section 4.05 Transfer of Shares. No transfer of stock
shall be valid as against the corporation except on surrender and
cancellation by the certificate therefor, accompanied by an
assignment or transfer by the registered owner made either in
person or under assignment. Whenever any transfer shall be
expressly made for collateral security and not absolutely, the
collateral nature of the transfer shall be reflected in the entry
of transfer on the books of the corporation.
Section 4.06 Transfer Agent. The Board of Directors may
appoint one or more transfer agents and registrars of transfer
and may require all certificates for shares of stock to bear the
signature of such transfer agent and such registrar of transfer.
Section 4.07 Stock Transfer Books. The stock transfer
books shall be closed for a period of ten (10) days prior to all
meetings of the shareholders and shall be closed for the payment
of dividends as provided in Article V hereof and during such
periods as, from time to time, may be fixed by the Board of
Directors, and, during such periods, no stock shall be
transferable.
Section 4.08 Miscellaneous. The Board of Directors shall have
the power and authority to make such rules and regulations not
inconsistent herewith as it may deem expedient concerning the
issue, transfer and registration of certificates for shares of
the capital stock of the corporation.
ARTICLE V
DIVIDENDS
Section 5.01 Dividends may be declared, subject to the
provisions of the laws of the State of Nevada and the Articles of
Incorporation, by the Board of Directors at any regular or
special meeting and may be paid in cash, property, shares of
corporate stock, or any other medium. The Board of Directors may
fix in advance a record date, as provided in Section 1.06 of
these By-Laws, prior to the dividend payment for the purpose of
determining shareholders entitled to receive payment of any
dividend. The Board of Directors may close the stock transfer
books for such purpose for a period of not more than ten (10)
days prior to the payment date of such dividend.
ARTICLE VI
OFFICES; RECORDS; REPORTS; SEAL AND FINANCIAL MATTERS
Section 6.01 Principal Office. The principal office of
the corporation in the State of Nevada shall be the office of its
President, Larry L. Beck, 1010 College Avenue, #2, Elko, Nevada
89801, and the corporation may have an office in any other state
or territory as the Board of Directors may designate.
Section 6.02 Records. The stock transfer books and a
certified copy of the By-Laws, Articles of Incorporation, any
amendments thereto, and the minutes of the proceedings of the
shareholders, the Board of Directors, and committees of the Board
of Directors shall be kept at the principal office of the
corporation for the inspection of all who have the right to see
the same and for the transfer of stock. All other books of the
corporation shall be kept at such places as may be prescribed by
the Board of Directors.
Section 6.03 Financial Report on Request. Any shareholder
or shareholders holding at least five percent (5%) of the
outstanding shares of any class of stock may make a written
request for an income statement of the corporation for the three
(3) month, six (6) month, or nine (9) month period of the current
fiscal year ended more than thirty (30) days prior to the date of
the request and a balance sheet of the corporation as of the end
of such period. In addition, if no annual report for the last
fiscal year has been sent to shareholders, such shareholder or
shareholders may make a request for a balance sheet as of the end
of such fiscal year and an income statement and statement of
changes in financial position for such fiscal year. The statement
shall be delivered or mailed to the person making the request
within thirty (30) days thereafter. A copy of the statements
shall be kept on file in the principal office of the corporation
for twelve (12) months, and such copies shall be exhibited at all
reasonable times to any shareholder demanding an examination of
them or a copy shall be mailed to each shareholder. Upon request
by any shareholder, there shall be mailed to the shareholder a
copy of the last annual, semiannual or quarterly income statement
which it has prepared and a balance sheet as of the end of the
period. The financial statements referred to in this Section
6.03 shall be accompanied by the report thereon, if any, of any
independent accountants engaged by the corporation or the
certificate of an authorized officer of the corporation that such
financial statements were prepared without audit from the books
and records of the corporation.
Section 6.04 Right of Inspection.
(a) The accounting books and records and minutes of
proceedings of the shareholders and the Board of Directors
and committees of the Board of Directors shall be open to
inspection upon the written demand of any shareholder or
holder of a voting trust certificate at any reasonable time
during usual business hours for a purpose reasonably related
to such holder's interest as a shareholder or as the holder
of such voting trust certificate. This right of inspection
shall extend to the records of the subsidiaries, if any, of
the corporation such inspection may be made in person or by
agent or attorney, and the right of inspection includes the
right to copy and make extracts.
(b) Every director shall have the absolute right at
any reasonable time to inspect and copy all books, records
and documents of every kind and to inspect the physical
properties of the corporation and/or its subsidiary
corporations. Such inspection may be made in person or by
agent or attorney, and the right of inspection includes the
right to copy and make extracts.
Section 6.05 Corporate Seal. The Board of Directors may,
by resolution, authorize a seal, and the seal may be used by
causing it, or a facsimile, to be impressed or affixed or
reproduced or otherwise. Except when otherwise specifically
provided herein, any officer of the corporation shall have the
authority to affix the seal to any document requiring it.
Section 6.06 Fiscal Year. The fiscal year-end of the
corporation shall be the calendar year or such other term as may
be fixed by resolution of the Board of Directors.
Section 6.07 Reserves. The Board of Directors may create,
by resolution, out of the earned surplus of the. corporation such
reserves as the directors may, from time to time, in their
discretion, think proper to provide for contingencies, or to
equalize dividends or to repair or maintain any property of the
corporation, or for such other purpose as the Board of Directors
may deem beneficial to the corporation, and the directors may
modify or abolish any such reserves in the manner in which they
were created.
ARTICLE VII
INDEMNIFICATION
Section 7.01 Indemnification. The corporation shall,
unless prohibited by Nevada Law, indemnify any person (an
"Indemnitee") who is or was involved in any manner (including,
without limitation, as a party or a witness) or is threatened to
be so involved in any threatened, pending or completed action
suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative, including without limitation, any
action, suit or proceeding brought by or in the right of the
corporation to procure a judgment in its favor (collectively, a
"Proceeding") by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was
serving at. the request of the corporation as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust, employee benefit plan or other entity or
enterprise, against all Expenses and Liabilities actually and
reasonably incurred by him in connection with such Proceeding.
The right to indemnification conferred in this Article shall be
presumed to have been relied upon by the directors, officers,
employees and agents of the corporation and shall be enforceable
as a contract right and inure to the benefit of heirs, executors
and administrators of such individuals.
Section 7.02 Indemnification Contracts. The Board of
Directors is authorized on behalf of the corporation, to enter
into, deliver and perform agreements or other arrangements to
provide any Indemnitee with specific rights of indemnification in
addition to the rights provided hereunder to the fullest extent
permitted by Nevada Law. Such agreements or arrangements may
provide (i) that the Expenses of officers and directors incurred
in defending a civil or criminal action, suit or proceeding, must
be paid by the corporation as they are incurred and in advance of
the final disposition of any such action, suit or proceeding
provided that, if required by Nevada Law at the time of such
advance, the officer or director provides an undertaking to repay
such amounts if it is ultimately determined by a court of
competent jurisdiction that such individual is not entitled to be
indemnified against such expenses, (ii) that the Indemnitee shall
be presumed to been titled to indemnification under this Article
or such agreement or arrangement and the corporation shall have
the burden of proof to overcome that presumption, (iii) for
procedures to be followed by the corporation and the Indemnitee
in making any determination of entitlement to indemnification or
for appeals therefrom and (iv)for insurance or such other
Financial Arrangements described in Paragraph 7.02 of this
Article, all as may be deemed appropriate by the Board of
Directors at the time of execution of such agreement or
arrangement.
Section 7.03 Insurance and Financial Arrangements. The
corporation may, unless prohibited by Nevada Law, purchase and
maintain insurance or make other financial arrangements
("Financial Arrangements") on behalf of any Indemnitee for any
liability asserted against him and liability and expenses
incurred by him in his capacity as a director, officer, employee
or agent, or arising out of his status as such, whether or not
the corporation has the authority to indemnify him against such
liability and expenses. Such other Financial Arrangements may
include (i) the creation of a trust fund, (ii) the establishment
of a program of self-insurance, (iii) the securing of the
corporation's obligation of indemnification by granting a
security interest or other lien on any assets of the corporation,
or (iv) the establishment of a letter of credit, guaranty or
surety.
Section 7.04 Definitions. For purposes of this Article:
Expenses. The word "Expenses" shall be broadly
construed and, without limitation, means (i) all direct and
indirect costs incurred, paid or accrued, (ii) all
attorneys' fees, retainers, court costs, transcripts, fees
of experts, witness fees, travel expenses, food and lodging
expenses while traveling, duplicating costs, printing and
binding costs, telephone charges, postage, delivery service,
freight or other transportation fees and expenses, (iii) all
other disbursements an&out-of-pocket expenses, (iv) amounts
paid in settlement, to the extent permitted by Nevada Law,
and (v) reasonable compensation for time spent by the
Indemnitee for which he is otherwise not compensated by the
corporation or any third party, actually and reasonably
incurred in connection with either the appearance at or
investigation, defense, settlement or appeal of a Proceeding
or establishing or enforcing a right to indemnification
under any agreement or arrangement, this Article, the Nevada
Law or otherwise; provided, however, that "Expenses" shall
not include any judgments or fines or excise taxes or
penalties imposed under the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or other excise
taxes or penalties.
Liabilities. "Liabilities" means liabilities of any
type whatsoever, including, but not limited to, judgments or
fines, ERISA or other excise taxes and penalties, and
amounts paid in settlement.
Nevada Law. "Nevada Law" means Chapter 78 of the
Nevada Revised Statutes as amended and in effect from time
to time or any successor or other statutes of Nevada having
similar import and effect.
This Article. "This Article" means Paragraphs 7.01
through 7.04 of these By-Laws or any portion of them.
Power of stockholders. Paragraphs 7.01 through 7.04,
including this Paragraph, of these By-Laws may be amended by
the stockholders only by vote of the holders of sixty-six
and two-thirds percent (66 2/3%) of the entire number of
shares of each class, voting separately, of the outstanding
capital stock of the corporation (even though the right of
any class to vote is otherwise restricted or denied);
provided, however, no amendment or repeal of this Article
shall adversely affect any right of any Indemnitee existing
at the time such amendment or repeal becomes effective.
Power of Directors. Paragraphs 7.01 through 7.04 and
this Paragraph of these By-Laws may be amended or repealed
by the Board of Directors only by vote of eighty percent
(80%) of the total number of Directors and the holders of
sixty-six and two-thirds percent (66 2/3%) of the entire
number of shares of each class, voting separately, of the
outstanding capital stock of the corporation (even though
the right of any class to vote is otherwise restricted or
denied); provided, however, no amendment or repeal of this
Article shall adversely affect any right of any Indemnitee
existing at the time such amendment or repeal becomes
effective.
ARTICLE VIII
BY-LAWS
Section 8.01 Amendment. Amendments and changes of these By-
Laws may be made at any regular or special meeting of the Board
of Directors by a vote of not less than all of the entire Board,
or may be made by a vote of, or a consent in writing signed by
the holders of a majority of the issued and outstanding capital
stock.
Section 8.02 Additional By-Laws. Additional by-laws not
inconsistent herewith may be adopted by the Board of Directors at
any meeting of the Board of Directors at which a quorum is
present by an affirmative vote of a majority of the directors
present or by the unanimous consent of the Board of Directors in
accordance with Section 2.11 of these By-Laws.
CERTIFICATION
I, the undersigned, being the duly elected secretary of the
Corporation, do hereby certify that the foregoing By-Laws were
adopted by the Board of Directors on the 28th of April, 1998.
/s/ Larry L. Beck, Secretary
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