FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS
Under Section 12(b) of (g) of the Securities Exchange Act of 1934
COLOR STRATEGIES
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(Name of Small Business Issuer in its charter)
Nevada 88-0390360
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization)
3050 East 630 North, St. George, Utah 84790
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(Address of principal executive offices) (Zip Code)
Issuer's Telephone Number: (435) 628-8130
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Securities to be registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be registered Each class is to be registered
None None
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Securities to be registered under Section 12(g) of the Act:
Common
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(Title of class)
PART I
Item 1. DESCRIPTION OF BUSINESS
BUSINESS DEVELOPMENT
Inception and Offering of Common Stock
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Color Strategies (the "Company" and/or the "Registrant") was incorporated
in the State of Nevada on March 23, 1998, with 25,000,000 shares of common
stock authorized, par value $0.001 per share. The Company's business purpose
was that of creating and presenting self-improvement and motivational seminars
which utilize the concept of image and style enhancement. At inception, the
Company issued 200,000 "unregistered", "restricted" shares to its founder in
connection with the initial funding of the Company. On August 13, 1998, the
Company commenced an offering of its common stock pursuant to an exemption
from the registration requirements of Section 5 of the Securities Act of 1933,
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as amended (the "Act"), under Section 3(b), Regulation D, Rule 504, whereby it
offered for sale up to 400,000 of its unregistered common shares at an
offering price of $.25 per share. The offering was also registered with the
State of Nevada. The purpose of the offering was to raise a minimum of $50,000
to fund the start-up-phase of its business operations, that is, the initial
development and marketing of seminars and workshops which will focus on a goal
of integrating image and color strategies with motivational and self-
improvement. The offering closed on August 24, 1998, with 201,800 shares
sold, for gross proceeds of $50,450.
Forward Looking Information
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This registration statement contains certain forward-looking statements
information relating to the Company that are based upon beliefs of the
Company's Management as well as assumptions made by and information currently
available to the Management. When used in this registration statement, the
words anticipate, believe, estimate, expect, and similar expressions, as they
related to the Company and the Company's Management, are intended to identify
forward-looking statements. Such statements reflect the current view of the
Company with respect to the future events and are subject to certain risks,
uncertainties, and assumptions. Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove incorrect,
actual results may vary materially from those described herein as anticipated,
believed, estimated or expected. The Company does not intend to update these
forward looking statements.
Risk Factors Which Could Affect Future Profitability
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*Lack of Operating History* The Company was only recently organized
and did not commence any operations until its offering of common stock in
August of 1998. Since August, the Company has had only minimal operations and
only $450 in revenues. Because of its limited capital and its lack of
significant operating history, the Company must be considered a development
stage company. Development stage companies are inherently more risky than
established companies because there is no earnings history and no assurance
that future revenues will develop. The Company's potential profitability is
questionable.
*Competition* The image and self-improvement speaking and seminar
industry is highly competitive with respect to name recognition, quality of
presentation, and location of engagement. There are numerous companies in the
industry which are well established and possess greater name recognition, and
substantially greater financial, marketing, personnel and other resources than
the Company. The Company can also expect to face a very broad range of
competition in the industry which include mass media consulting companies and
fashion show promoters. Many of the Company's competitors have already
achieved recognition at the national, regional and local levels. In addition,
many of these competitors are represented by speaking bureaus, and/or promoted
by established promoters in their respective industries and/or these
competitors engage in extensive advertising and promotional programs on their
own. These well established companies will also have developed training and
marketing strategies for dealing readily with changes in the industry. The
Company can expect to compete in the Las Vegas area (where it will begin its
initial marketing) with numerous well established, successful companies. (See
"BUSINESS OF THE REGISTRANT, Competitive Business Conditions/Competitive
Position in the Industry/Methods of Competition".)
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*No Formal Market Feasibility Study* The public speaking/seminar
industry is vast with over 30,000 professional speakers, and hundreds of
specialized topics. The performance of an individual company can be affected
by such factors as advertising, promotion, target audiences, and quality of
presentation. The Company has not performed a formal market feasibility study
to determine if the services it proposes to perform will be widely accepted
and will be able to compete in this industry sector. This lack of a
geographically specific market analysis could have a negative impact on the
success of the Company's business operations. Although the Company intends to
study its potential market region, and define its potential marketing area
along with the types of markets which do exist for image and self-improvement
seminars, workshops and training, the Company has not yet delineated the same
and does not believe it has sufficient resources and topics to specialize its
services and topics. As a result, the Company must be able to stay advised to
industry trends and remain flexible enough to address client needs. There can
be no guarantee that the Company will be successful in doing so.
*Conflicts of Interest* Both of the Company's officers/directors are
involved with other business interests which will take a portion of their
time. (See "Item 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS".) These individuals will not, therefore, devote 100% of their time
to the Company. Tami Tischner, the Company's President, Secretary/Treasurer
and a Director, is involved with other business interests which demand her
time especially her position as an independent sales director for Mary Kay,
Inc. (more commonly known in the industry as Mary Kay Cosmetics). Ms. Tischner
received her background and training through her long time association with
Mary Kay, Inc.; such training has influenced her development of the color and
imaging concepts which she intends to apply to seminars and motivational
workshops. In fact, much of Ms. Tischner's public speaking experience and
concept development is a result of such association with Mary Kay, Inc.
Although Ms. Tischner is an independent party and not bound by any contracts
or employment agreements with Mary Kay, Inc. regarding seminar presentation or
public speaking events, in recent times, she has been contracted by Mary Kay,
Inc. to perform similar services for seminars as she will perform on behalf of
the Company. It is Ms. Tischner's intention that any speaking engagements
and/or seminar presentations which Ms. Tischner now and hereinafter
participates will be for the benefit of developing the Company's business,
rather than for her own individual benefit. Ms. Tischner's main focus as an
independent sales director for Mary Kay, Inc. is, and will continue to be, the
training and motivation of the 50-100 sales consultants under her in area of
Mary Kay, Inc. cosmetic sales and marketing, and Ms. Tischner does not believe
the foregoing provides any direct or indirect competition with any of the
Company's business purposes. However, a conflict of interest could arise if
Ms. Tischner is contacted by Mary Kay, Inc., or some other company to provide
public speaking, or organize seminars or employee/management training, etc.
Because there is no non-compete agreement in effect between Ms. Tischner and
the Company, Ms. Tischner could chose to perform such services as herself
rather than as a representative of the Company. There is no assurance,
therefore, if such a conflict of interest arose, that it would be resolved in
favor of the Company.
*Inexperience of Management* Although Ms. Tischner has considerable
experience in the color and image consulting and motivational speaking
industry, Management of the Company has no experience in running a company in
the start-up and development stage. This lack of experience provides for
considerable risk to the Company's ultimate success.
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*No Public Market for Company's Securities* At the present time there
is no public market for the Company's common stock, and there can be no
assurance that a public market will develop. Although the Company intends to
apply for a listing on the National Association of Securities Dealer's Inc.
Over-the-Counter Bulletin Board (the "NASD OTC Bulletin Board"), there is no
guarantee that such will be the case, or that if the Company succeeds in
listing its common stock on the NASD OTC Bulletin Board that a market for the
Company's common stock will develop. Even if the Company is able to develop a
market for its common stock, there can be no assurance that the price per
share in such market will be equal to or greater than the price paid by
investors in its offering which closed on August 24, 1998, in which investors
paid $.25 per share, and, in fact, it could be substantially less.
*Sales of Shares by "Insiders"* - Of the 401,800 common shares of the
Company's common stock currently issued and outstanding, 201,800 unregistered
common shares are owned by public investors in the Company's offering, and
200,000 unregistered common shares are considered "restricted" and are held by
the Company's founder and its President, Secretary/Treasurer and Chairman of
the Board of Directors, Tami Tischner. Her 200,000 initial shares were issued
in reliance on the "private placement" exemption of Section 4(2) of the
Securities Act of 1933, as amended. If a market for the Company's common
shares were to develop, such "restricted" shares will not be available for
sale in the open market without registration, except in reliance upon Rule 144
under the Act or some other applicable exemption. In general, under Rule 144,
a person or persons whose shares are aggregated, who beneficially owned shares
acquired in a non-public transaction for at least one year, including persons
who may be deemed "affiliates" of the Company as that term is defined under
the 1933 Act, would be entitled to sell within any three-month period, a
number of shares that does not exceed the greater of 1% of the then
outstanding shares of Common Stock or the average weekly reported trading
volume on all national securities exchanges and through NASDAQ during the four
calendar weeks preceding such sale provided current public information is then
available. If a substantial number of the shares owned by the initial
shareholders were sold in the market, the market price of the common stock
could be adversely affected. As of the date hereof, Ms. Tischner's 200,000
shares issued in reliance upon Section 4(2)and considered "restricted", have
been beneficially owned for almost one year (since March 30, 1998) which would
make them eligible for resale under Rule 144 provided all of the applicable
terms and conditions were met, and provided a public market existed for the
Company's common shares, on March 31, 1999. Currently, Ms. Tischner's 200,000
shares are being held in escrow pursuant to Nevada Revised Statutes
90.500(8)(a)and will be held until approximately March 25 of this year.(See
"SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT", under Part
I, Item 4 of this Registration Statement; also see Part II, Item 1. "MARKET
PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS.")
*Penny Stock Regulation* If the Company succeeds in developing a
market for its common shares, it will be subject to the penny stock rules. The
Securities and Exchange Commission (the "SEC")has adopted rules that regulate
broker dealer practices in connection with penny stocks. Penny stock are
generally equity securities with a price of less than $5.00 (other than
securities registered on certain national securities exchanges or quoted on
the NASDAQ system, provided current price and volume information with respect
to transactions in such securities is provided by the exchange system.) The
penny stock rule requires that a broker/dealer, prior to a transaction in a
penny stock not otherwise exempt under the rules, to deliver a standardized
risk disclosure document prepared by the SEC that provides information about
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penny stocks and the nature and level of risks in the penny stock market. The
broker dealer must also provide the customer with bid and offer quotations for
the penny stock, the compensation to the broker dealer and its salesperson in
the transaction, and monthly account statements showing the market value of
each penny stock held in the customer account. In addition, the penny stock
rules require that prior to a transaction in a penny stock not otherwise
exempt from such rules, the broker dealer must make a special written
determination that a penny stock is a suitable investment for the purchaser
and receive the purchaser's written agreement to the transaction. These
disclosure requirements may have the effect of reducing the level of trading
activity in the secondary market for a stock that becomes subject to the penny
stock rules. The Company's common stock is currently subject to the penny
stock rules, and, accordingly, investors may find it difficult to sell their
shares, if at all, when and if a public market develops.
*Need for Additional Financing* Unless the Company is able to generate
sufficient revenues to successfully develop and sustain its business
operations, the survival of the Company will likely depend on additional
financing. No assurance can be made that such financing would be available,
and, if available, whether it would take the form of debt or equity financing.
In either case, additional financing could have a negative impact on the
Company's shareholders. The Company may seek financing in the form of debt
financing in the form of a loan which could be from an individual or financial
institution. Such loan could put the Company at risk for amounts greater than
its assets, and, if not promptly repaid, could result in bankruptcy. If the
Company attempted equity financing in the form of either a private placement
or a another type of offering, there can be no assurance that the Company
would be successful in selling such an offering or finding an underwriter
willing to do; such an offering could result in further dilution to present
shareholders.
*Dependence on Management/Key Personnel* The Company is extremely
dependent on Management. The loss of any of its officers could have a
material adverse effect on the Company's business. Because of the Company's
limited resources, no key person insurance has been, or will be purchased on
any of its officers. In addition, the future success of the Company is
dependent on the performance of Management, especially Tami Tischner, and her
ability to attract and motivate and retain highly qualified employees. In
addition, the Company's business plan is based almost entirely on concepts of
color and image strategies developed and being developed by Ms. Tischner, and
how the same can work to benefit individuals, businesses and mass media. The
loss of Tami Tischner' services would have a material adverse effect on the
Company. In addition to her services, Ms. Tischner also provides the Company,
without charge the usage of her personal computer, copier, and miscellaneous
office equipment, and her personal vehicle.
BUSINESS OF REGISTRANT
Principal Products or Services and Their Market
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The Company has conducted little or no business since its inception
other than the raising of funds for the commencement of its business
operations in the seminar/motivational industry.
** Principal Product/Service **
The Company has based its business purpose on its belief that there is a
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large source of potential revenue in the motivational and self-improvement
industry from both businesses and individuals and that one of the best ways to
get such specialized training in motivation and self-improvement is through
seminars and/or workshops. The Company plans to introduce to the established
topics of self-improvement and motivation the concepts of image and style
enhancement (hereinafter called "Color/Image Strategies"). Because the
Company believes that identifying personality characteristics through color
codes can be beneficial to self motivation and interaction between
individuals, the Company's business goal is to integrate its Color/Image
Strategies with motivational and self-improvement topics through the use of
seminars, workshops, specialized training services, and public speaking
engagements. The seminars and workshops will be developed to help the
individual participants understand who they are, how they react, and how they
interact in society as well as the business world.
The Color/Image Strategies concept is based on the Company's belief
that self improvement through image, style, and color combined with knowledge
of oneself can serve to improve communication and interaction with others as
well as improve work performance. In other words, Color/Image Strategies can
enhance an individuals performance and success in dealing with other people
through self-examination, identification of strengths and weaknesses, and
introducing life changing personality characteristics for better living and
improved work habits. Once such personality strengths are identified, a
person can enhance and strengthen his/her self-image by proper dress and image
consulting.
The motivational and self-improvement industry is relatively new
especially in connection to keynote speaking which was pioneered by such
individuals as Zig Ziglar, Anthony Robbins and Stephen Covey. It is also a
vast industry of seminars and professional speaking with many different
facets. There are thousands of professional speakers, hundreds of speakers'
bureaus (organizations which represent the professional speakers) and a
variety of market niches in the industry which include both the corporate
world as well as a variety of non-corporate organizations. The current trend
in topics appears to include time management, organization, self-motivation,
and "dealing with change" due to corporate downsizing. Management intends to
capitalize on the popularity of the industry by adding its Color/Image
Strategies and by tailoring its seminars, workshops, and keynote speakers, to
meet the specific needs of each individual client. Thus, the Company's
marketing approach will be to sell its Color/Imaging Strategies concept to an
end-user, and then tailor a presentation utilizing such strategies which is
designed specifically to meet the needs of the client. The Company's marketing
program will be based on its ability to present customized presentations to
accommodate a specific audience through the use of seminars, workshops and
motivational speakers, as well as utilizing Color/Image Strategies for
everything from one-on-one consulting to mass media consulting. The Company
intends to focus on image, style and color concepts in the following areas
within the industry:
1. Employee and Management Training
2. Trade and Professional Associations
3. Motivational Keynote Speaking Engagements
4. Image and Motivational Individual "One-on-One" Consulting
5. Fashion Shows
6. Mass Media Consulting
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** Target Markets**
The application of Color/Imaging Strategies is extremely broad and can
be beneficial for individuals in pursuing their own goals as well as
corporations, businesses and professional organizations in the areas of
management and employee training. Due to the limited capital available to it,
and the uncertainty of the product's success and marketability, Management
intends to attempt to prove the commercial viability of its Color/Image
Strategies by successfully utilizing its color and image strategies in one or
more of the following target markets discussed below. Although the Company's
business scope is broad, it believes that it would be premature to narrow its
target market and believes it should pursue all areas until such time at it
develops its own market niche. The Company's initial marketing approach,
therefore, will be to solicit interest in its concept, and pursue various
markets as they arise by adapting its concepts to the end-user. The Company's
largest hurdle will be to convince its various target markets that the use of
its Color/Image Strategies will prove beneficial. Once any of the following
markets are penetrated by the Company, it plans to pursue and increase that
penetration aggressively. The following are various markets the Company will
initially pursue:
1. Employee and Management Training One of the most successful uses
of Color/Image Strategies may prove to be in corporate hiring strategies and
employee relations. Management training seminars will help management
recognize the strengths and weaknesses in various types of personalities which
are identified in terms of colors. Management will then be better able to
identify their personnel needs in terms of both hiring and promotion, as well
as establish training programs which will increase employee performance and
improve employee/management relations. By understanding the differences,
strengths and weaknesses on a more individualized basis, Management can
maximize its personnel by relating to employees in an manner which will
achieve the highest performance from each employee. Employees can learn how to
enhance their own personalities, more clearly define their goals, abilities,
and ambitions, and improve both their work habits and relationships with
employers, thus maximizing chances for success. The Company believes that the
Hotel/Casino industry will be one of its initial target market for its
Color/Image Strategies seminars and workshops in the area of employee and
management training, especially that of the greater Las Vegas area. The
Company hopes to negotiate contracts with various casinos and hotels to
provide training seminars and services to new employees. The Company will
formulate an individualized approach for each client which will be combine
such client hotel/casino's new employee orientation program with Color/Image
Strategies. The Company hopes to negotiate contracts which will based on a
standard weekly compensation fee rather than on price per person thus
providing the Company with consistent revenues. The Company will also be
utilizing the client's facilities for its employee management training. The
Company believes that its strategies will help these employers establish
better and more productive relationships with their employees by helping the
businesses identify personality characteristics, maximizing positive traits
and placing and promoting individuals in areas which utilize the positive
character traits.
2. Training Videos - The Company will also target mass media for its
Color/Image Strategies. The Company believes that there will be a demand for
color and image consulting in production of videos and tapes by various
companies because it can be used to stylize the image of training videos,
infomercials and demonstration tapes. The Company has been contacted by at
least one company to provide consultation in the production of an infomercial
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and intends eventually either to sub-contract on a case by case basis to
various companies to provide consultation on color and imaging in production
while in the planning stage, or to achieve a long-term contract with a
production company to provide consultation services. Additionally, the
Company intends to develop a "self help" key note speech into a motivation
tape for purchase. The Company is looking into costs of production of the
same with various companies.
3. Motivational Workshop Seminars the Company hopes to provide
workshops and seminars to various organizations, especially trade and
professional associations which would be enhanced through an introduction of
Color/Image Strategies. In such case, the Company would tailor its seminar or
work shop to a specific audience. These workshops and seminars may include
such events as fashion shows, "dress for success" and other types of image
consulting, and make-up consulting.
4. Motivational and Keynote Speaking Services the Company hopes
to provide key note and motivational speaking to seminars and/or workshops.
The Company hopes to promote interest in speaking at other motivation and
self-help seminars sponsored by various companies or organizations. Such
speaking services will be provided by Tami Tischner and the Company has not
identified any other speakers who would speak on the Company's Color/Image
Strategies.
5. One-on-One Image Consulting The Company also has the ability
to provide individualized consulting services on a one on one basis.
Individualized consulting could be highly beneficial to persons who are not
maximizing their potential and would like to improve their own communication
skills and interaction with others by identifying personality strengths and
weaknesses and then enhancing those strengths though proper dress and image
consulting.
The Company has chosen its initial geographical market to be Las Vegas,
Nevada and Southern Utah. It is also investigating Arizona, California and
other areas of Utah, and will target companies in those geographical areas
which it believes will benefit from its services.
Distribution Methods of the Products or Service
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Until such time as the Company can formulate a clear business plan and
marketing approach, it will be unable to delineate what methods will be best
for distribution of its Color/Image Strategies. Initially, the Company's goal
is to make contacts and establish a client base in the various target markets
that it believes to present the most potential for its concept. The Company
must gain an interest in its concept before it can capitalize on it.
Therefore, it will be dependent on advertising and publicity to bring
awareness of the Color/Image Strategies concept to potential end-users. Ms.
Tischner has been actively seeking speaking engagements in order to bring
about an interest and awareness in the Color/Image Strategies Concept. In the
past few months she spoke to the St. George, Utah Chamber of Commerce, to the
Business of Professional Women also in St. George, Utah, to the St. George
Fire Department, and at Mary Kay, Inc. conferences in Nevada, Utah, Idaho,
Texas, and Louisiana. The Company is also working on an advertising campaign
with AW Marketing, a Utah based advertising company. It intends to launch a
campaign with coupon books advertised over local radio stations in Southern
Utah and Nevada. The Company will work on a one-on-one basis as a personal
consultant enhancing and strengthening an individual's self-image through
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proper dress and cosmetics.
The Company is actively seeking interest in its services from hotels
and casinos in Las Vegas Nevada specifically in the area of
employee/management training. The Company is currently in negotiating stages
for a contract with Harrah's Hotel and Casino. It is also investigating the
possibility of speaking engagements by Ms. Tischner in Las Vegas, including a
possible appearance as a guest speaker on a weekend radio and television show
done by the Imperial Palace Hotel & Casino.
The Company will also rely upon word-of-mouth and referrals to help
establish a client base. When the Company is able to better identify and
focus on more specific markets, it will adjust its distribution methods
accordingly. At such time, once it has built its market profile, it
anticipates advertising through direct mail. Currently, as discussed above,
the Company is advertising inside coupon books sold through a radio station
that broadcasts in the Southern Utah and Southern Nevada areas.
Status of any Publicly Announced New Product or Service
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The Company has only recently commenced business operations. On May 20,
1998, it issued a press release announcing its formation and purpose. Such
release was disseminated in "Main Street Journal" in St. George, Utah. The
Company has not issued any other press release since that date.
Competitive Business Conditions/Competitive Position
in the Industry/Methods of Competition
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The image and self-improvement speaking and seminar industry is highly
competitive with respect to name recognition, quality of presentation, and
location of engagement. There are numerous companies in the industry which
are well established and possess greater name recognition, and substantially
greater financial, marketing, personnel and other resources than the Company.
The Company can also expect to face a very broad range of competition in the
industry which include mass media consulting companies and fashion show
promoters. Many of the Company's competitors have already achieved recognition
at the national, regional and local levels. In addition, many of these
competitors are represented by speaking bureaus, and/or promoted by
established promoters in their respective industries and/or these competitors
engage in extensive advertising and promotional programs on their own. These
well established companies have also developed training and marketing
strategies for dealing readily with changes in the industry. The Company can
expect to compete in the Las Vegas area (where it will begin its initial
marketing) with numerous well established, successful companies. Such
competitors include Express Yourself Seminars, Image Dynamics, Image
Consulting, and Rapport Leadership Institute, all well established
organizations. General competition in the industry is also anticipated from
such successful companies as Key Seminars Speaker Bureau, TEAM Seminars,
Speakers Unlimited, SkillPath Seminars, and image/self improvement speakers
such as John Maxwell and Donte.
The Company believes that its competitive advantages will be the following:
1. Pricing. Most competitors in the industry currently focus on price
per person and size of attendance. Current prices range from $50 - $1,000 per
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person depending on the total time required to address each contracted need.
The Company does not plan, during its development stage, to compete with those
companies by attempting to attract large audiences. It will limit itself to
establishing market awareness of its concept and gaining a foothold in one of
its target markets by offering its services as at a lower cost.
2. Subject Matters of Seminars. The Company believes that its largest
advantage will be its subject matter and the quality of presentation.
The Company believes that its subject matter is unique because it emphasizes a
motivational theme coupled with the Company's application of Color/Imaging
Strategies. The Color/Image Strategy concept is based on the Company's belief
that self improvement through image, style, and color combined with knowledge
of oneself can serve to improve communication and interaction with others as
well as improve work performance. In other words, Color/Image Strategies can
enhance an individuals performance and success in dealing with other people
through self-examination, identification of strengths and weaknesses, and
introducing life changing personality characteristics for better living and
improved work habits. Once such personality strengths are identified, a
person can enhance and strengthen his/her self-image by proper dress and image
consulting. The Company believes that it is introducing a new concept to self-
help and motivational topics through such vehicles as: Employee and Management
Training, Training Videos, Motivational Workshop Seminars, Motivational and
Keynote Speaking Services, and One-on-One Image Consulting. These vehicles
are not new to the speaking industry; however, it believes the color and
imaging concepts combined with such vehicles are original in the industry and
not yet exploited. The Company believes the One-on-One Imaging Consulting as
a starting point for the Company might be the niche that sets it above the
competition.
3. Lower Overhead. The operating costs for national competitors can
be expensive. Professional speakers that are represented by speaking bureaus
pay 20-30% of the gross revenue for representation and booking. The Company
plans to avoid this expense by establishing direct contracts with potential
clients. The Company will benefit from conducting business operations in Las
Vegas, Nevada, the nation's largest convention center, by reducing travel
expenses, equipment rental, and other miscellaneous overhead expenses.
The Company's ability to compete will be based on its ability to: (1)
utilize its Color/Image Strategies to enhance known concepts of self
improvement and motivational seminars, (2) offer services which are both high
in quality and competitively priced, and (3) successfully penetrate markets
which already have a large variety of similar services available to them. In
addition it will also depend on its ability to recognize and respond to trends
in its potential and existing market sectors. The Company will, therefore,
face a substantial degree of competition in all of the market segments it
intends to pursue. Even if the Company is successful in forming a client base
and making inroads into one or more market segments, the Company's concept is
not considered proprietary and there is no assurance that another company or
organization with far more resources, experience and name recognition in the
industry, will not develop a similar strategy and/or concept.
Sources and Availability of Raw Materials/Names of Principal Suppliers
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The Company is not dependent on any raw materials and principal
suppliers. It will produce its own seminars and provide its own key note
speakers. The Company is, however, highly dependent on Tami Tischner, who is
an officer and director of the Company and the developer of the Color/Image
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Strategies concept an will, at least initially, provide the majority of the
expertise in seminar production as well as be the prime keynote speaker.
Dependence on a Few Major Customers
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The Company is not dependent on a few major customers. It does not as of
this date have any customers, and has not narrowed its marketing focus to any
clearly identifiable target market.
Patents, Trademarks, Licenses, Franchises, Concessions,
Royalties Agreements, Labor Contracts
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The Company has no patents, trademarks, licenses, franchises of
concessions nor is it a party to any royalty agreements or labor contracts.
The Company is developing a logo and may register it as the Company grows.
The Company does not have any special know-how or proprietary information at
this time other than its speech material which cannot be patented. The
Company understands that speeches can be copyrighted, therefore, the Company
is looking into copyright privileges in reference to speeches and training
outlines with the Copyright Office, Library of Congress, Washington DC.
Need for Government Approval
- ----------------------------
None
Effect of Existing or Probable Government Regulations
- -----------------------------------------------------
The only existing or probable government regulations affecting the
Company will be the Company's need to comply with regulations which affect
each of its clients on a case by case basis. For example, when conducting
employee orientation on the premises of a hotel/casino, the Company will be
subject and must comply with all safety/health regulations and rules to which
the client is subject to. The Company may be required to meet certain
federal, state and local regulatory standards in such areas of insurance,
bonding and/or sheriff cards in connection with some of the seminars or
workshops it conducts. The Company does not know as of this date what the
effect of such regulations will be on its business or operations.
Research and Development Activities in the Past Two Years
- ----------------------------------------------------------
The Company has been in business only since March of 1998. No money has
been spent on research and development. The Company's business development
will be initially funded by capital raised in its recent offering.
Total Number of Employees
- -------------------------
The Company has no employees as of this date other than Tami Tischner who
is also the Company's President, Secretary/Treasurer and a director. The
Company, upon commencement of business operations, intends to compensate Ms.
Ticshner at a rate of $1,000 per month. The Company has no plans to hire any
additional employees during the next twelve months. Once the Company is
established, it may hire some additional part-time employee to assist in
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<PAGE>
preparation and presentation of seminars.
Item 2. PLAN OF OPERATION
To date, the Company has only received $450 in revenues from operations.
During the next twelve months the Company's plan of operation is to introduce
its Color/Image Strategies to various markets and hopefully achieve a certain
amount of market penetration in one or more of these markets by achieving a
client base. The Company intends to continue to develop its concept of
Color/Image Strategies to suit its market as it is better able to delineate
and focus on its goals. The Company will pursue advertising campaigns in
Southern Utah and Nevada as well as speaking engagements. It plans to focus
on both one-on-one consultations and employee management training seminars for
various industry segments. It will also investigate production of motivation
tapes incorporating its Color/Imaging Strategies.
During the next twelve months, its cash requirements will include its
lease payments of $400 per month on the Company's office space in St. George,
Utah, compensation to Tami Tischner of $1,000 per month, as well as
miscellaneous overhead. The Company believes that the funds it raising in
its offering in August of 1998 ($50,450 in gross proceeds), which are largely
not yet expended, will be sufficient to provide for the foregoing cash
requirements for day to day operations in the next twelve months, as well at
provide for costs of implementing its marketing strategies. Of those funds,
the Company has budgeted approximately $29,000 to cover the costs associated
with establishing its client base, advertising , purchase of supplies and
equipment associated with seminars, and hopefully some limited market
penetration. There is no guarantee that the budgeted funds will be sufficient
to achieve these goals. The Company has no plans for any purchases of
significant equipment or property, nor are there plans for additional
employees until or unless warranted due to business needs. Management believes
that it will not achieve profitability until it is able to realize
approximately $5,000 in gross sales per month. The Company has no guarantee
that it will be able to achieve this goal in the next twelve months.
If the Company does not succeed in seeing limited revenues or, at
minimum, the potential of limited revenues, in the next twelve months, it may
be forced to discontinue operations unless it is able to raise sufficient
capital to continue pursuing its business plan. Management is not experienced
in developmental companies and may not have estimated its needs for
advertising and associated expenses in acquiring a client base accurately.
The Company may require additional funds and time to achieve these goals.
Even if the Company begins generating revenues, it could require additional
funding for expansion. It may be difficult for the Company to succeed in
securing additional financing. The Company may be able to attract some private
investors, or officers and directors may be willing to make additional cash
contributions, advancements or loans. Or, in the alternative, the Company
could attempt some form of debt or equity financing. However, there is no
guarantee that any of the foregoing methods of financing would be successful.
If the Company fails to achieve at least a portion of its business goals in
the next twelve months with the funds available to it, there is substantial
uncertainty as to whether it will continue operations.
-12-
<PAGE>
Item 3. DESCRIPTION OF PROPERTY
The Company does not own any property. It is a party to a month to a
month-to-month lease agreement, executed on November 1, 1998, on office space
in St. George, Utah. It also has office space available for its use, if
needed, in Las Vegas, Nevada, at the office of its registered agent. The St.
George, Utah office is sufficiently close to the geographical territory where
the Company plans to operate its seminars, that is the Las Vegas, Nevada and
Southern Utah area, for efficient operations. The lease provides the Company
with approximately 300 square feet of office space, sufficient to conduct its
operations, at a monthly lease payment of $400. The lessor is Wagon Master, a
company owned by Jerry Tischner, the husband of the Company's President. The
term of the lease is month to month.
Item 4. SECURITY OWNERSHIP OF BENEFICIAL OWNERS AND MANAGEMENT
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table sets forth the amount and nature of beneficial
ownership of each person known to a beneficial owner of more than five percent
of the issued and outstanding shares of the Company. The following
information is based on 401,800 shares issued and outstanding as of the date
hereof .
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
(1) (2) (3) (4)
Title of Name and Amount and Percent of
Class Address of Nature of Class
Beneficial Beneficial
Owner Owner
- --------- ------------- -------------- ----------
Common Tami Tischner 200,000 Shares(2) 49.78%
3050 East 630 North Sole Voting Power
St George UT 84790
Common Kenneth Hofert(1) 21,600 Shares 5.38%
4443 Valley Regal Way Joint Voting Power
Las Vegas NV 89129
- ---------------------------------------
(1) Kenneth Hofert is the owner of 20,000 common shares in his record name;
his son, Sean Hofert is the record owner of 1,600 common shares. Sean Hofert
resides with his father Kenneth, and is not 18 years of age. The 1,600 shares
owned by Sean could, therefore, be construed as being beneficially owned by
Kenneth.
(2) Currently Ms. Tischner's 200,000 shares are being held in an escrow
account, pursuant to Nevada Revised Statutes 90.500(8)(a) and will be released
on approximately March 25, 1999.
- ---------------------------------------
The following table sets forth the amount and nature of beneficial
ownership of each of the executive officers and directors of the Company. The
information below is based on 401,800 shares issued and outstanding as of the
date hereof.
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<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
(1) (2) (3) (4)
Title of Name and Amount and Percent of
Class Address of Nature of Class
Beneficial Beneficial
Owner Owner(1)
- --------- ------------- -------------- ----------
Common Tami Tischner 200,000 Shares(2) 49.78%
3050 East 630 North Sole Voting Power
St. George, UT 84790
Common Ginger Szewczyk -0- -0-
150 South 300 East
St. George, UT 84770
- --------------------------------------------------
Officers & Directors as a group 200,000 shares 49.78%
- --------------------------------------------------
(1) Neither of the Company's officer or directors have any rights to acquire
additional shares of the Company's common stock, beneficially or otherwise.
(2) Currently Ms. Tischner's 200,000 shares are being held in an escrow
account, pursuant to Nevada Revised Statutes 90.500(8)(a) and will be released
on approximately March 25, 1999.
- --------------------------------------------------
CHANGES IN CONTROL
The Company has no arrangements which might result in a change in
control of the Company.
Item 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
OFFICERS AND DIRECTORS
The names and ages of all directors and executive officers of the
Company, along with their respective positions, term of office and period such
position(s) was held, is as follows:
Name Age Position Held & Since
- --------------- ---- -------------------------
Tami Tischner 40 President/Secretary/Treasurer, Chairman of
the Board of Directors, Chief Executive
Officer, Chief Financial Officer
----------------------
Since March 23, 1998(1)
Ginger Szewczyk 45 Director, Vice President
------------------------
Since March 23, 1998(1)
(1) Each of the above individuals will serve in their respective capacities
until the next annual meeting of the shareholders or until a successor is duly
qualified and elected.
-14-
<PAGE>
BIOGRAPHICAL INFORMATION ON OFFICERS AND DIRECTORS
MS. TAMI TISCHNER, age 40, has served as President, Chief Executive Officer,
Chief Financial Officer, Secretary/Treasurer, and a Director of the Company
since March 24, 1998. Ms. Tischner graduated from Dixie High in St. George,
Utah in 1976. Since 1993 to the present, Ms. Tischner has been an Independent
Sales Director with Mary Kay, Inc. Ms. Tischner does direct sales for Mary
Kay, Inc. and is a director over 50-100 independent sales consultants. Ms.
Tischner, during the last two years, has produced motivational seminars and
fashion shows involving dressing for success and color logic strategy for Mary
Kay, Inc. Ms. Tischner has also worked with Criscione Fashion Designers of
New York. Both Criscione and Mary Kay, INc. are leaders in their respected
industries. Ms. Tischner has also worked as an professional image and color
consultant to companies in the mass-media industry. Much of Tami Tischner's
professional speaking experience and seminar presentation material as well as
the development of her Color/Image Strategies is a result of her association
with Mary Kay, Inc.
GINGER SZEWCZYK, age 45, has served as a Director and Vice President of the
the Company since March 24, 1998. Ms. Szewczyk graduated from Chadsworth High
School in San Fernando, Ca., in 1971. From 1992 to present, Ms. Szewczyk owns
and operates a sole proprietorship, "Designs by Gingi", a design consultation
and interior decorator business in St. George, Utah. Ms. Szewczyk received
training under Karen Butera, a well known interior designer located in Palo
Alto, California, and traveled the U.S. decorating custom model homes. Recent
projects for which Ms. Szewczyk has provided interior decorating services and
expertise include, Dixie State Bank, U.S. Government Water District Building,
Dixie Regional Hospital, Skin and Cancer Center, all in St. George, Utah. She
has performed design consultation services for Sy Redd, the owner of Oasis Spa
Resort in Mesquite, Nevada.
FAMILY RELATIONSHIPS
There are no family relationships among the Company's directors and/or
executive officers.
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS
Except as indicated below and/or hereinbefore, to the knowledge of
Management, during the past five years, no present or former director,
executive officer, or person nominated to become a director or executive
officer of the Company:
(1) Filed a petition under federal bankruptcy laws or any state
insolvency law, nor had a receiver, fiscal agent or similar officer appointed
by a court for the business or property of such person, or any partnership in
which he was a general partner at or within two years before the time of such
filing, or any corporation or business association of which he was an
executive officer at or within two years before the time of such filing;
(2) Was convicted in a criminal proceeding or named subject of a
pending criminal proceeding (excluding traffic violations and other minor
offences);
(3) Was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining him or her from or
otherwise limiting his/her involvement in any type of business, securities or
-16-
<PAGE>
banking activities;
(4) Was found by a court of competent jurisdiction in a civil
action, by the Securities and Exchange Commission or the Commodity Futures
Trading Commission, to have violated any federal or state securities law, and
the judgment in such civil action or finding by the Securities and Exchange
Commission has not been subsequently reversed, suspended, or vacated.
Item 6. EXECUTIVE COMPENSATION
The following table sets forth certain information as to compensation
received by the Company's Chief Executive Officer who is also a director of
the Company and its President, Secretary & Treasurer, as of December 31, 1998.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation
----------------------------------------------------------------------
Annual Compensation Awards Payouts
- ------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other All
Name Annual Restricted Other
and Compensa- Stock Underlying LTIP Compensa-
Principal sation Award Options/ Payouts tion
Position Year Salary($) Bonus($) ($) ($) SAR's(#) ($) ($)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Tami Tischner(1) 1998 -0- -0- -0- -0- -0- -0- -0-
President, CEO, CFO
Secretary/Treasurer
Director
- ------------------------------------------------------------------------------------------------
(1) The Company intends to compensate Ms. Tischner $1,000 per month at such time as the
Company actually commences conducting substantive business.(See "CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS."
</TABLE>
OPTIONS/SAR GRANTS
There were no stock options or stock appreciation rights granted to any
executive officer since its inception through present date.
AGGREGATED OPTION/SAR EXERCISES AND FISCAL YEAR END OPTION/SAR VALUE TABLE
Not applicable.
LONG TERM INCENTIVE PLANS
There are no long term incentive plans in effect and therefore no awards
have been given to any executive officer in the past year.
COMPENSATION OF DIRECTORS
The Company pays no fees to members of the Company's Board of Directors
for the performance of their duties as directors. The Company has not
established committees of the Board of Directors.
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<PAGE>
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS
The Company has no employment contracts in effect with any of the members
of its Board of Directors or its executive officers nor are there any
agreements or understandings with such persons regarding termination of
employment or change-in-control arrangements. The Company has agreed to
compensate Ms. Tischner $1,000 per month for services rendered in her
capacity as Secretary/Treasurer/President of the Company and such time as the
Company actually commences substantive operations. Because much of the
Company's business will rely on Ms. Tischner's knowledge and expertise, as
well as the Color/Image Strategies developed by her such as they are
ultimately applied and utilized in the Company's business operations, Ms.
Tischner may be entitled to additional compensation at a future date. Such
compensation will be at the discretion of the Board of Directors and will be
authorized based on several different factors such as, the nature and quantity
of work Ms. Tischner performs, the results of her marketing and client base
efforts, the number of speaking engagements, seminars, workshops and
consultations she presents, the amount of revenues, if any, which may result
from her efforts, etc. Such compensation could take the form of cash bonuses,
or salary arrangements over and above of the current agreed upon salary of
$1,000 per month; or it could take the form of restricted stock awards, or
option grants. If Ms. Tischner's efforts have positive results, it is likely
that the Company will enter into some sort of employment agreement with Ms.
Tischner. (See "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS".)
Item 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has no transactions which have occurred that would be deemed
related party transactions. Ms. Tischner, who is President,
Secretary/Treasurer, Chief Executive Officer, Chief Financial Officer, and
Chairman of the Board, received 200,000 common shares of the Company's stock
at inception for a $10,000 cash contribution. The Company has also agreed to
compensate Ms. Tischner for services performed for the Company in the future
at a rate of $1,000 per month. Because the Company's business plan relies on
Ms. Tischner's talent and expertise in her field, and the development and
application of the Color/Image Strategies by Ms. Tischner, there is the
possibility that Ms. Tischner will receive additional compensation in the
future for her contributions to the Company. This compensation may be
substantial. The Board of Directors has the authority to approve additional
compensation for Mr. Tischner if she performs substantial services to the
Company in its initial phase of operations. The amount and type of such
compensation will depend on the amount and success of Ms. Tischner's services
and as well as the Company's cash flow. The Board of Directors has authorized
and Management has budgeted only $12,000 for Ms. Tischner's salary for the
next 12 months. Because the Company does not intend to hire additional
personnel within that time period, it will be entirely reliant on Ms. Tischner
and her ability to formulate a client base, perform one-on-one services which
may result from the Company's advertising campaign, negotiate contracts with
potential hotel/casino contracts, and customize and deliver presentations for
any such contracts, in addition to recognizing and following through on those
business opportunities which appear to offer the most potential to the
Company. Additional compensation to Ms. Tischner, if any, could be
substantial, and could take the form of salary increases, cash bonuses,
restricted stock awards, or stock options. The potential for Ms. Tischner to
benefit personally from her contributions to the Company exists, therefore,
although the amount and nature of such benefit has yet to be determined. (See
"Executive Compensation".)
-17-
<PAGE>
The Company has entered into one contract, a lease with Wagon Masters, on
office space in St. George, Utah. Wagon Masters is a company owned and
operated by Ms. Tischner's husband. (See "Part I, Item 3, DESCRIPTION OF
PROPERTY.")
Item 8. DESCRIPTION OF SECURITIES
COMMON STOCK
The authorized capital stock of the Company consists of 25,000,000 shares
of Common Stock, $.001 par value per share. The holders of Common Stock (i)
have equal ratable rights to dividends from funds legally available therefore,
when, as and if declared by the Board of Directors of the Company; (ii) are
entitled to share ratably in all of the assets of the Company available for
distribution or winding up of the affairs of the Company; (iii) do not have
preemptive subscription or conversion rights and there are no redemption or
sinking fund applicable thereto; and (iv) are entitled to one non-cumulative
vote per share, on all matters which shareholders may vote on at all meetings
of shareholders. The Company, however, does not anticipate paying dividends
on its Common Stock in the foreseeable future but plans to retain earnings, if
any, for the operation and expansion of its business.
There are no provisions in the Company's charter or bylaws which would
delay, defer, or prevent a change in control of the Company.
NON-CUMULATIVE VOTING
The holders of shares of Common Stock of the Company do not have
cumulative voting rights which means that the holders of more than fifty
percent (50%) of such outstanding shares, voting for the election of
directors, can elect all of the directors to be elected, if they so choose,
and, in such event, the holders of the remaining shares will not be able to
elect any of the Company's directors. Management currently owns 49.78% of the
outstanding shares of the Company.
PART II
Item 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
MARKET INFORMATION
The Company has no public trading market for its common stock. Although
the Company intends to seek a quotation for its common shares on the NASD
Over-the-Counter Bulletin Board in the future, there is no assurance the
Company will do so, nor is there any assurance that should the Company
succeed in obtaining a listing for its securities on the NASD OTC Bulletin
Board or on some other exchange, that a trading market for the Company's stock
will develop. There are no outstanding options, warrants to purchase, or
securities convertible into common equity of the Company outstanding. The
Company has not agreed to register any shares of its common stock for any
shareholder.
Of the 401,800 common shares of the Company's common stock currently
issued and outstanding, 201,800 are owned by public investors purchased in the
Company's offering conducted in reliance upon the exemption provided for under
Section 3(b), Regulation D, Rule 504 and registered with the State of Nevada,
and closed on August 24, 1998; and 200,000 are held by one officer and
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<PAGE>
director and issued in reliance on the "private placement" exemption of
Section 4(2)of the Securities Act of 1933, as amended. If a market for the
Company's common shares were to develop, such 200,000 "restricted" shares,
held by the officer and director would not be available for sale in the open
market without registration, except in reliance upon Rule 144 under the Act or
some other applicable exemption. In general, under Rule 144, a person or
persons whose shares are aggregated, who beneficially owned shares acquired in
a non-public transaction for at least one year, including persons who may be
deemed "affiliates" of the Company as that term is defined under the 1933 Act,
would be entitled to sell within any three-month period a number of shares
that does not exceed the greater of 1% of the then outstanding shares of
Common Stock or the average weekly reported trading volume on all national
securities exchanges and through NASDAQ during the four calendar weeks
preceding such sale provided current public information is then available. As
of the date hereof, the 200,000 shares issued in reliance upon Section 4(2)and
therefore considered "restricted", have been beneficially owned since March
30, 1998 which would make them eligible for resale under Rule 144 as of March
31, 1999, provided all of the applicable terms and conditions of Rule 144 were
met, and provided a public market existed for the Company's common shares.
The 200,000 unregistered common shares owned by Ms. Tischner are
currently being held in escrow pursuant to Nevada Revised Statutes
90.500(8)(a). The foregoing rule grants the administrator of the Nevada
Securities Division, in cases of registration under Nevada Revised Statutes
90.480 or 90.490 of an issuer which has no public market for its common shares
and no significant earnings from operations during the past 5 years or any
shorter period of existence, the authority to require as a condition of
registration, that certain securities be deposited in escrow for not more than
three years. The administrator ordered such escrow of Ms. Tischner's shares.
The shares will no longer be subject to escrow as of March 25, 1999, one year
from the date of escrow.
HOLDERS
There are 40 shareholders of record of the Company's common stock.
DIVIDENDS
The payment by the Company of dividends, if any, in the future, rests
within the discretion of its Board of Directors and will depend among other
things, upon the Company's earnings, its capital requirements and its
financial condition, as well as other relevant factors. The Company has not
paid or declared any dividends to date due to its present financial status.
The Company does not anticipate paying dividends on its common stock in the
foreseeable future but plans to retain earnings, if any, for the operation and
expansion of its business. There are no restrictions that limit the ability to
pay dividends on common equity or that are likely to limit the same in the
near future.
Item 2. LEGAL PROCEEDINGS
The Company is not a party to any pending legal proceedings and, to the
best of its knowledge, no such action by or against the Company has been
threatened. None of the Company's officers, directors, or beneficial owners
of 5% or more of the Company's outstanding securities is a party to a
proceeding adverse to the Company nor do any of the foregoing individuals have
a material interest in a proceeding adverse to the Company.
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<PAGE>
Item 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
The Company's former principal independent accountant, S.J. Meyer & Co.,
which audited the Company's financial statements as of August 31, 1998, and
for the period from inception on March 24, 1998 through such date, was
replaced on October 3, 1998. The former accountant's report on such
financial statements, dated October 2, 1998, did not contain an adverse
opinion, or disclaimer of opinion, nor was it modified to as to uncertainty,
audit scope or accounting principles.
The decision to change accountants was approved by the Board of
Directors. There were no disagreements with the former accountants on any
matter of accounting principles or practices, financial disclosure or auditing
scope.
The Company's new accountant is David E. Coffey, Certified Public
Accountant and was engaged on January 6, 1999.
Item 4. RECENT SALES OF UNREGISTERED SECURITIES
The Company has issued the following unregistered common shares in the
past three years.
(1) On March 23, 1998, at the Company's organizational meeting, the
Company issued 200,000 unregistered common shares to its founder, Tami
Tischner. Such shares were issued for a $10,000 capital contribution from Ms.
Tischner. The shares were issued pursuant to the exemption provided for under
Section 4(2) of the Securities Act of 1933, as amended, to one individual, as
a "transaction not involving a public offering." Ms. Tischner is the Company's
President/Secretary/Treasurer, Chief Executive Officer, Chief Financial
Officer and a Director of the Company.
(2) On August 13, of 1998, the Company commenced an offering of up to
400,000 of its unregistered common shares at an offering price of $.25 per
share. The offering was conducted in reliance on an exemption from the
registration requirements of Section 5 of the Act as promulgated under Section
3(b), Regulation D, Rule 504, and pursuant to registration by qualification
with the State of Nevada in accordance with the requirements of Nevada Revised
Statutes 90.490 and 90.500 with offers and sales made only to residents of the
State of Nevada. The offering closed on August 24, 1998 with 201,800 shares
sold to 39 individuals and gross proceeds of $50,450.00. A commission of 5%
was paid to the Company's licensed sales agent in the offering, Mr. Kenneth
Hofert, Jr. The Company believes it was entitled to rely on the exemption
provided under Rule 504 of Regulation D at the time of the offering because it
was not: (a)subject to section 13 or 15(d) of the Securities Exchange Act of
1934; (b) an investment company, or (c) a development stage company that had
no specific business plan or purpose or whose only purpose was to engage in a
merger with an unidentified company(s). The Company also believes that its
offering otherwise met all of the terms and conditions of Rule 504 of
Regulation D and the applicable provisions of Rules 501 through 503 as well as
the applicable provisions of Nevada Revised Statutes 90.490 and 90.500.
Item 5. INDEMNIFICATION OF OFFICERS AND DIRECTORS
The only statutes, charter provisions, by-laws, contracts or other
arrangements under which any controlling person, director or officer of the
Company is insured or indemnified in any manner against any liability which he
may incur in his capacity as such, are as follows:
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<PAGE>
A. Indemnification provided by statute:
Sections 78.037, 78.751 and 78.752 of the Nevada Revised Statutes offer
limitation of liability protection for officers and directors and/or
indemnification protection of officers, directors, employees and agents of the
Company, and provide as follows:
78.037. Articles of incorporation: Optional provisions.
The articles of incorporation may also contain:
1. A provision eliminating or limiting the personal liability of a
director officer to the corporation or its stockholders for damages for breach
of fiduciary duty as a director or officer, but such a provision must not
eliminate or limit the liability of a director or officer for:
(a) Acts or omissions which involve intentional misconduct, fraud
or a knowing violation of law; or
(b) The payment of distributions in violation of NRS 78.300.
2. Any provision, not contrary to the laws of this state, for the
management of the business and for the conduct of the affairs of the
corporation, and any provision creating, defining, limiting or regulating the
powers of the corporation or the rights, powers or duties of the directors,
and the stockholders, or any class of the stockholders, or the holders of
bonds or other obligations of the corporation, or governing the distribution
or division of the profits of the corporation.
78.751. Indemnification of officers, directors, employees and agents;
advancement of expenses.
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 the action, suit or proceeding if he acted in good faith
and in a manner which is 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 upon a plea of nolo contendere or its equivalent, does 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
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<PAGE>
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
the action or suit 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. Indemnification may not be made for any claim, issue or matter
as to which such a person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals therefrom, to be liable to the
corporation or for amounts paid in settlement to the corporation, unless and
only to the extent that the court in which the action or suit was brought or
other court of competent jurisdiction determines upon application that in view
of all the circumstances of the case, the person is fairly and reasonably
entitled to indemnity for such expenses as the court deems 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 must be indemnified by the
corporation against expenses, including attorneys' fees, actually and
reasonably incurred by him in connection with the defense.
4. Any indemnification under subsections 1 and 2, unless ordered by a
court or advanced pursuant to subsection 5, must be made by the corporation
only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper in the
circumstances. The determination must be made:
a. By the stockholders;
b. By the board of directors by majority vote of a quorum
consisting of directors who were not parties to the act, suit or proceeding;
c. If a majority vote of a quorum consisting of directors who
were not parties to the act, suit or proceeding so orders, by independent
legal counsel in a written opinion; or
d. If a quorum consisting of directors who were not parties to
the act, suit or proceeding cannot be obtained, by independent legal counsel
in a written opinion.
5. The articles of incorporation, the bylaws or an agreement made
by the corporation may provide 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 the action, suit or proceeding, upon receipt of an undertaking
by or on behalf of the director or officer to repay the amount if it is
ultimately determined by a court of competent jurisdiction that he is not
entitled to be indemnified by the corporation. The provisions of this
subsection do not affect any rights to advancement of expenses to which
corporate personnel other than directors or officers may be entitled under any
contract or otherwise by law.
6. The indemnification and advancement of expenses authorized in or
ordered by a court pursuant to this section:
a. Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under the articles
of incorporation or any bylaw, agreement, vote of stockholders or
-22-
<PAGE>
disinterested directors or otherwise, for either an action in his official
capacity or an action in another capacity while holding his office, except
that indemnification, unless ordered by a court pursuant to subsection 2 or
for the advancement of expenses made pursuant to subsection 5, may not be made
to or on behalf of any director or officer if a final adjudication establishes
that his acts or omissions involved intentional misconduct, fraud or a knowing
violation of the law and was material to the cause of action.
b. Continues for a person who has ceased to be a director,
officer, employee or agent and inures to the benefit of the heirs, executors
and administrators of such a person.
78.752. Insurance and other financial arrangements against liability of
directors, officers, employees and agents.
1. A corporation may purchase and maintain insurance or make other
financial arrangements on behalf of any person who 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 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 his
status as such, whether or not the corporation has the authority to indemnify
him against such liability and expenses.
2. The other financial arrangements made by the corporation pursuant
to subsection 1 may include the following:
a. The creation of a trust fund.
b. The establishment of a program of self-insurance.
c. The securing of its obligation of indemnification by
granting a security interest or other lien on any assets of the corporation.
d. The establishment of a letter of credit, guaranty or surety.
No financial arrangement made pursuant to this subsection may provide
protection for a person adjudged by a court of competent jurisdiction, after
exhaustion of all appeals therefrom, to be liable for intentional misconduct,
fraud or a knowing violation of law, except with respect to the advancement of
expenses or indemnification ordered by a court.
3. Any insurance or other financial arrangement made on behalf of a
person pursuant to this section may be provided by the corporation or any
other person approved by the board of directors, even if all or part of the
other person's stock or other securities is owned by the corporation.
4. In the absence of fraud:
a. The decision of the board of directors as to the propriety of
the terms and conditions of any insurance or other financial arrangement made
pursuant to this section and the choice of the person to provide the insurance
or other financial arrangement is conclusive; and
b. The insurance or other financial arrangement:
(1) Is not void or voidable; and
-23-
<PAGE>
(2) Does not subject any director approving it to
personal liability for his action, even if a director approving the insurance
or other financial arrangement is a beneficiary of the insurance or other
financial arrangement.
5. A corporation or its subsidiary which provides self-insurance for
itself or for another affiliated corporation pursuant to this section is not
subject to the provisions of Title 57 of NRS.
B. The TWELFTH article of the Company's Articles of Incorporation limits
the liability exposure of officers and directors of the Company for damages.
It provides as follows: No director or officer of the 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 director of officer; provided however, that the foregoing
provision shall not eliminate or limit the liability or a director or officer
(i) for acts or omissions which involve intentional misconduct, fraud or a
knowing violation of law, or (ii) the payment of dividends in violation of
Section 78.300 of the Nevada Revised Statutes. Any repeal or modification of
this Article by the stockholders of the Corporation shall be prospective only
and shall not adversely affect any limitation on the personal liability of a
director or officer of the Corporation for acts of omissions prior to such
repeal or modification.
C. Article VI, INDEMNIFICATION OF OFFICERS AND DIRECTORS, of the Company's
By-Laws provides for the following indemnification protections: Except as
hereinafter stated otherwise, the Corporation shall indemnify all of its
officers and directors, past, present and future, against any and all expenses
incurred by them, and each of them including but not limited to legal fees,
judgments and penalties which may be incurred, rendered or levied in any legal
action brought against any or all of them for or on account of any act or
omission alleged to have been committed while acting within the scope of their
duties as officers or directors of this Corporation.
As of the date hereof, the Company has no contracts in effect
providing any indemnitee with any specific rights of indemnification although
the Company's bylaws authorize its Board of Directors to enter into and
deliver such contracts to provide an indemnitee with specific rights of
indemnification in addition to the rights provided in the Articles and Bylaws
to the fullest extent provided under Nevada law. The Company has no special
insurance against liability although the Company's bylaws provide that the
Company may, unless prohibited by Nevada law, maintain such insurance.
Indemnification for liabilities arising under the Act may be
permitted for directors, officers and controlling persons of the Company
pursuant to the foregoing or otherwise. However, the Company has been advised
that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable.
PART F/S
The following financial statements are included herewith: the Company's
audited financial statements for its year ended December 31, 1998.
-24-
<PAGE>
COLOR STRATEGIES
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
DECEMBER 31, 1998
TABLE OF CONTENTS
Page Number
-----------
ACCOUNTANT'S REPORT.....................................................1
FINANCIAL STATEMENTS
Balance Sheet......................................................2
Statement of Operations and Deficit
Accumulated During the Development Stage.......................3
Statement of Changes in Stockholders' Equity.......................4
Statement of Cash Flows............................................5
Notes to the Financial Statements..................................6
-25-
<PAGE>
<Letterhead of David Coffey appears here>
David E. Coffey
Certified Public Accountant
3651 Lindell Rd., Suite H, Las Vegas, NV 89103
(702) 871-3979
To the Board of Directors and Stockholders
of Color Strategies
Las Vegas, Nevada
I have audited the accompanying balance sheet of Color Strategies (a
development stage company) as of December 31, 1998 and the related statements
of operations, cash flows and changes in stockholders' equity for the period
from March 24, 1998 (date of inception) to December 31, 1998. These financial
statements are the responsibility of Color Strategies 's management. My
responsibility is to express an opinion on these financial statements based on
my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audit of the financial
statements provide a reasonable basis for my opinion.
In my opinion, the accompanying financial statements present fairly, in
all material respects, the financial position of Color Strategies as of
December 31, 1998 and the results of operations, cash flows and changes in
stockholders' equity for the period then ended in conformity with generally
accepted accounting principles.
/s/ DAVID COFFEY, CPA
David Coffey, C.P.A.
January 17, 1999
F1
<PAGE> -26-
COLOR STRATEGIES
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
DECEMBER 31, 1998
ASSETS
Cash $ 46,184
Organization costs less accumulated
amortization of $80 455
Prepaid expenses 600
----------
Total Assets $ 47,239
==========
LIABILITIES & STOCKHOLDERS' EQUITY
Accounts payable:
Trade $ 700
Stockholder 185
---------
Total Liabilities 885
Stockholders' Equity
Common stock, authorized 25,000,000 shares
at $.001 par value, issued and outstanding
401,800 shares 402
Additional paid-in capital 48,160
Deficit accumulated during
the development stage (2,208)
----------
Total Stockholders' Equity 46,354
Total Liabilities and Stockholders' Equity $ 47,239
==========
The accompanying notes are an integral part of
these financial statements.
F2
<PAGE> -27-
COLOR STRATEGIES
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS AND DEFICIT
ACCUMULATED DURING THE DEVELOPMENT STAGE
FOR PERIOD ENDED FROM MARCH 24, 1998
TO DECEMBER 31, 1998
Revenue $ 450
----------
Expenses
Amortization 80
Advertising 724
Licenses and fees 495
Office expense 559
Rent 800
----------
Total expenses 2,658
Net loss (2,208)
Retained earnings,
beginning of period -
----------
Deficit accumulated during
the development stage $ (2,208)
==========
The accompanying notes are an integral part of
these financial statements.
F3
<PAGE> -28-
COLOR STRATEGIES
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
PERIOD FROM MARCH 24, 1998 (DATE OF INCEPTION)
TO DECEMBER 31, 1998
Additional
Common Stock Paid-in
Shares Amount Capital Total
----------- ------------ ------------ ------------
Balance,
March 24, 1998 -- $ -- $ -- $ --
Issuance of common
stock for cash
March of 1998 200,000 200 9,800 10,000
Issuance of common
stock for cash
August of 1998 201,800 202 50,248 50,450
Less offering costs -- -- (11,888) (11,888)
Less net loss -- -- -- (2,208)
----------- ----------- ------------ -------------
Balance,
December 31, 1998 401,800 $ 402 $ 48,160 $ 46,354
========== ========== ========== ==========
The accompanying notes are an integral part of
these financial statements.
<PAGE> -29- F4
COLOR STRATEGIES
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
From March 24, 1998
To December 31, 1998
CASH FLOWS USED BY OPERATING ACTIVITIES
Net income $ (2,208)
Noncash items included in net loss
Amortization 80
Increase in prepaid expenses (600)
Increase in accounts payable 885
-----------
NET CASH PROVIDED BY
OPERATING ACTIVITIES (1,843)
CASH FLOWS USED BY INVESTING ACTIVITIES
Organizational costs 535
-----------
NET CASH USED BY
INVESTING ACTIVITIES 535
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 402
Additional paid-in capital 60,048
Less offering costs (11,888)
------------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 48,562
NET INCREASE IN CASH 46,184
CASH AT BEGINNING OF PERIOD --
-----------
CASH AT END OF PERIOD $ 46,184
===========
The accompanying notes are an integral part of
these financial statements.
F5
<PAGE> -30-
COLOR STRATEGIES
NOTES TO THE FINANCIAL STATEMENTS
December 31, 1998
NOTE A SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Company was incorporated on March 24, 1998 under the laws of
the state of Nevada. The business purpose of the Company is to
provide motivational and self improvement services through the use
of seminars, workshops, specialized training courses and other aids.
The Company will adopt accounting policies and procedures based upon
the nature of future transactions.
NOTE B ORGANIZATION COSTS
Organization costs are capitalized and amortized over 60 months.
NOTE C OFFERING COSTS
The offering costs were incurred by the Company in connection with a
public stock offering were deducted from the net proceeds of that
offering.
NOTE D STOCK OFFERING
The Company completed two offering of its common stock. The first
offering was a private placement offer of 200,000 shares in March of
1998 to its founding stockholder. The second offering was completed
in August of 1998 consisting of 201,800 shares at $.25 per share.
The net proceeds of that offering will used to provide motivational
and self improvement services through the use of seminars,
workshops, specialized training courses and other aids.
F6
<PAGE> -31-
PART III
Item 1. INDEX TO EXHIBITS
No. Description
- ---- ------------
3.1 Articles of Incorporation
3.2 Bylaws
10 Lease Agreement
16 Letter RE: Change of Certifying Accountant
27 Financial Data Schedule
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.
Registrant:
COLOR STRATEGIES
Date: March 4, 1999 By: /s/ Tami Tischner
-----------------------------
Tami Tischner
President, Secretary/Treasurer
Chief Executive Officer, Chief
Financial Officer, Chairman of
the Board of Directors
Date: March 4, 1999 By: /s/ Ginger Szewczyk
-----------------------------
Ginger Szewczyk
Director
Vice-President
Exhibit 3.1
Articles of Incorporation
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
MAR 23 1998
No. C-6469-98
/s/ Dean Heller
DEAN HELLER, SECRETARY OF STATE
ARTICLES OF INCORPORATION
OF
COLOR STRATEGIES
FIRST. The name of the corporation is:
COLOR STRATEGIES
SECOND. Its registered office in the State of Nevada is located at 5015
W. Sahara Ave., #184, Las Vegas, Nevada 89102, that this Corporation may
maintain an office, or offices, insuch other place within or without the State
of Nevada as may be from time to time designated by the Board of Directors, or
by the By-Laws of said Corporation, and that this Corporation may conduct all
Corporation business of every kind and nature, including the holding of all
meetings of Directors and Stockholders, outside the State of Nevada as well as
within the State of Nevada.
THIRD. The objects for which this Corporation is formed are: To engage in
any lawful activity, including, but not limited to the following:
(A) Shall have such rights, privileges and powers as may be
conferred upon corporations by any existing law.
(B) May at any time exercise such rights, privileges and powers,
when not inconsistent with the purposes and objects for which this corporation
is organized.
(C) Shall have power to have succession by its corporate name for
the period limited in its certificate or articles of incorporation, and when
no period is limited, perpetually, or until dissolved and its affairs wound up
according to law.
(D) Shall have the power to effect litigation in its own behalf
and interest in any court of law.
(E) Shall have power to make contracts.
(F) Shall have power to hold, purchase and convey real and
personal estate and mortgage or lease any such, real and personal estate with
its franchises. The power to hold real and personal estate shall include the
power to take the same by devise or bequest in the State of Nevada, or in any
other state, territory or country.
(G) Shall have power to appoint such officers and agents as the
affairs of the corporation shall require, and to allow them suitable
compensation.
<PAGE>
(H) Shall have power to make By-Laws not inconsistent with the
constitution or laws of the United States, or of the State of Nevada, for the
management, regulation and government of its affairs and property, the
transfer of its stock, the transaction of its business, and the calling and
holding of meetings of its stockholders.
(I) Shall have power to dissolve itself.
(J) Shall have power to adopt and use a common seal or stamp, and
alter the same. The use of a seal or stamp by the corporation on any corporate
documents is not necessary. The corporation may use a seal or stamp, if it
desires, but such use or nonuse shall not in any way affect the legality or
the document.
(K) Shall have power to borrow money and contract debts when
necessary for the transaction of its business, or for the exercise of its
corporate rights, privileges or franchises, of for any other lawful purpose of
its incorporation; to issue bonds, promissory notes, bills or exchange,
debentures, and other obligations and evidences of indebtedness, payable at a
specified time or times, or payable upon the happening of a specified event or
events, whether secured by mortgage, pledge or otherwise, or unsecured, for
money borrowed, or in payment for property purchased, or acquired, or for any
other lawful object.
(L) Shall have power to guarantee, purchase, hold, sell, assign,
transfer, mortgage, pledge or otherwise dispose of the shares of the capital
stock of, or any bonds, securities or evidences of the indebtedness created
by, any other corporation or corporations of the State of Nevada, or any other
state or government, and, while owners of such stock, bonds, securities or
evidences of indebtedness, to exercise all the rights, powers and privileges
of ownership, including the right to vote, if any.
(M) Shall have power to purchase, hold, sell and transfer shares
of its own capital stock and use therefor its capital, capital surplus,
surplus, or other property or fund.
(N) Shall have power to conduct business, have one or more
offices, and hold, purchase mortgage and convey real and personal property in
the State of Nevada, and in any of the several states, territories,
possessions and dependencies of the United States, the District of Columbia,
and foreign countries.
(0) Shall have power to do all and everything necessary and proper
for the accomplishment of the objects enumerated in its certificate or
incidental to the
2
<PAGE>
protection and benefit of the corporation, and, in general to carry on any
lawful business necessary or incidental to the attainment of the objects of
the corporation, whether or not such business is similar in nature to the
objects set forth in the certificate or articles of incorporation of the
corporation, or any amendment thereof.
(P) Shall have power to make donations for the public welfare or
for charitable scientific or educational purposes.
(Q) Shall have power to enter into partnerships, general or
limited, or joint ventures in connection with any lawful activities.
FOURTH. The aggregate number of shares the corporation shall have
authority to issue shall be TWENTY FIVE MILLION (25,000,000) shares of common
stock, par value one mil ($.001) per share, each share of common stock having
equal rights and preferences, voting privileges and preferences.
FIFTH. The governing board of this corporation shall be known as
directors, and the number of directors may from time to time be increased or
decreased in such manner as shall be provided by the By-Laws of this
Corporation, providing that the number of directors shall not be reduced to
fewer than one (1).
The name and post office address of the first Board of Directors
shall be one (1) in number and listed as follows:
NAME ADDRESS
Tami Tischner 3050 East 600 North
Provo, Utah 87440
SIXTH. The capital stock, after the amount of the subscription price, or
par value, has been paid in, shall not be subject to assessment to pay the
debts of the corporation.
SEVENTH. The name and post office address of the Incorporator signing the
Articles of Incorporation is as follows:
NAME ADDRESS
Progressive Management & Consulting, Inc. 5015 W. Sahara Ave., # 184
Las Vegas, Nevada 89102
3
<PAGE>
EIGHTH. The resident agent for this corporation shall be:
PROGRESSIVE MANAGEMENT & CONSULTING, INC.
The address of said agent, and the registered or statutory address of this
corporation in the State of Nevada shall be:
5015 W. Sahara Ave., # 184
Las Vegas, Nevada 89102
NINTH. The corporation is to have perpetual existence.
TENTH. In furtherance and not in limitation of the powers conferred by
statute, the Board of Directors is expressly authorized:
Subject to the By-Laws, if any, adopted by the Stockholders, to make,
alter of amend the By-Laws of the Corporation.
To fix the amount to be reserved as working capital over and above its
capital stock paid in to authorize and cause to be executed, mortgages and
liens upon the real and personal property of this Corporation.
By resolution passed by a majority of the whole Board, to designate one
(1) or more committees, each committee to consist of one or more of the
Directors of the Corporation, which, to the extent provided in the resolution,
or in the By-Laws of the Corporation, shall have and may exercise the powers
of the Board of Directors in the management of the business and affairs of the
Corporation. Such committee, or committees shall have such name, or names as
may be stated in the By-Laws of the Corporation, or as may be determined from,
time to time by resolution adopted by the Board of Directors.
When and as authorized by the affirmative vote of the Stockholders
holding stock entitling them to exercise at least a majority of the voting
power given at a Stockholders meeting called for that purpose, or when
authorized by the written consent of the holders of at least a majority of the
voting stock issued and outstanding, the Board of Directors shall have power
and authority at any meeting to sell, lease or exchange all of the property
and assets of the Corporation, including its good will and its corporate
4
<PAGE>
upon such terms and conditions as its Board of Directors deems expedient and
for the best interests of the Corporation.
ELEVENTH. No shareholder shall be entitled as a matter of right to
subscribe for or receive additional shares of any class of stock of the
Corporation, whether now or hereafter authorized, or any bonds, debentures or
securities convertible into stock, but such additional shares of stock or
other securities convertible into stock may be issued or disposed of by the
Board of Directors to such persons and on such terms as in its discretion it
shall deem advisable.
TWELFTH. No director or officer of the Corporation shall be personally
liable to the Corporation or any of its stockholders for damages for breach of
fiduciary duty as a director or officer involving any act or omission of any
such director of officer; provided however, that the foregoing provision shall
not eliminate or limit the liability or a director or officer (i) for acts or
omissions which involve intentional misconduct, fraud or a knowing violation
of law, or (ii) the payment of dividends in violation of Section 78.300 of the
Nevada Revised Statutes. Any repeal or modification of this Article by the
stockholders of the Corporation shall be prospective only and shall not
adversely affect any limitation on the personal liability of a director or
officer of the Corporation for acts of omissions prior to such repeal or
modification.
THIRTEENTH. This Corporation reserves the right to amend, alter, change
or repeal any provision contained in the Articles of Incorporation, in the
manner now or hereafter prescribed by statute, or by the Articles of
Incorporation, and all rights conferred upon Stockholders herein are granted
subject to this reservation.
5
<PAGE>
I, THE UNDERSIGNED, being the Incorporator hereinbefore named for the
purpose of forming a Corporation pursuant to the General Corporation Law of
the State of Nevada, do make and file these Articles of Incorporation, hereby
declaring and certifying that the facts herein stated are true, and
accordingly have hereunto set my hand this 24th day of March, 1998.
/s/Dennis D. Evans
---------------------
Dennis D. Evans
STATE OF NEVADA )
COUNTY OF CLARK )
On this the 24th day of March, 1998, in Las Vegas, Nevada before me,
the undersigned, a Notary Public in and for __________, State of Nevada
personally appeared Dennis D. Evans, Known to me to be the person whose name
is subscribed to the foregoing document and acknowledged to me that he
executed the same.
/s/ Rebecca Ann Green
Notary Public
<Notary State of Rebecca
Ann Green appears here>
6
<PAGE>
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
MAR 24 1998
No. C-6469-98
/s/ Dean Heller
DEAN HELLER, SECRETARY OF STATE
CERTIFICATE OF ACCEPTANCE
OF APPOINTMENT BY RESIDENT AGENT
IN THE MATTER OF COLOR STRATEGIES
I, Progressive Management & Consulting, Inc., do hereby certify that on
the 24th day of March, 1998, I accepted the appointment as Resident Agent of
the above-entitled corporation in accordance with Sec. 78.090, NRS 1957.
Furthermore, That the Principal office in this state is located at 5015
W. Sahara Ave., # 184, City of Las Vegas 89102, County of Clark, State of
Nevada.
IN WITNESS WHEREOF, I have hereunto set my hand this 24th day of March
1998.
PROGRESSIVE MANAGEMENT & CONSULTING, INC.
By: /s/ Progressive Management & Consulting, Inc.
----------------------------------------------
Progressive Management & Consulting, Inc.
Resident Agent
<PAGE>
SECRETARY OF STATE
<The Great Seal of the State of Nevada appears here>
STATE OF NEVADA
CORPORATE CHARTER
I, DEAN HELLER, the duly elected and qualified Nevada Secretary of
State, do hereby certify that COLOR STRATEGIES did on MARCH 24,1998, file in
this office the original Articles of Incorporation; that said Articles are now
on file and of record in the office of the Secretary of State of the State of
Nevada, and further, that said Articles contain all the provisions required by
the law of said State of Nevada.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the Great Seal of
State, at my office, in. Las-Vegas, Nevada, on MARCH 24,1998.
/s/ Dean Heller
<Great Seal of the State Secretary of State
Of Nevada appears here>
By /s/ Sharee Davis
Certification Clerk
<PAGE>
Exhibit 3.2
BY LAWS
OF
COLOR STRATEGIES
ARTICLE I
OFFICES
SECTION 1. PRINCIPAL OFFICE. The principal office of the Corporation
shall be located in the City of Las Vegas, Nevada, Clark County.
SECTION 2. OTHER OFFICES. In addition to the principal office at 5015
W. Sahara Ave., #184, Las Vegas, Nevada 89102 other offices may also be
maintained at such other place or places, either within or without the State
of Nevada, as may be designed from time to time by the Board of Directors,
where meetings of the stockholders and of the Directors may be held with the
same effect as though done or held at said principal office.,
ARTICLE II
MEETING OF STOCKHOLDERS
SECTION 1. ANNUAL MEETINGS. The annual meeting of the shareholders,
commencing with the year 1998, shall be held at the registered office of the
corporation, or at such other place as may be specified or fixed in the notice
of such meetings in the month of or the month preceding the due date of the
annual list of the officers and directors of the corporation at such time as
the shareholders shall decide, for the election of directors and for the
transaction of such other business as may properly come before said meeting.
SECTION 2. NOTICE OF ANNUAL MEETINGS. The Secretary shall mail, in the
manner provided in Section 5 of Article II of these Bylaws, or deliver a
written or printed notice of each annual meeting to each stockholder or
record, entitled to vote thereat, or may notify by telegram, as least ten and
not more than sixty (60) days before the date of such meeting.
SECTION 3. PLACE OF MEETINGS. The Board of Directors may designate any
place either within or without the State of Nevada as the place of meeting for
annual meeting or for any special meeting called by the Board of Directors. A
waiver of notice signed by all stockholders may
<PAGE>
designate any place either within or without the State of Nevada, as the place
for the holding of such meeting. If no designation is made, or it a special
meeting be otherwise called, the place of meeting shall be the principal
office of Corporation in the State of Nevada, except as otherwise provided in
Section 6, Article 11 of these Bylaws, entitled "Meeting of All Stockholders".
SECTION 4. SPECIAL MEETINGS. Special meetings of the stockholders shall
be held at the principal office of the Corporation or at such other place as
shall be specified or fixed in a notice thereof. Such meetings of the
stockholders may be called at any time by the President or Secretary, or by a
majority of the Board of Directors then in office, and shall be called by the
President with or without Board approval on the written request of the holders
of record of at least fifty percent (50%) of the number of shares of the
Corporation then outstanding and entitled to vote, which written request shall
state the object of such meeting.
SECTION 5. NOTICE OF MEETING. Written or printed notice stating the
place, day and hour of the meeting and, in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not
less than ten (10) nor more than sixty (60) days before the date of the
meeting, either personally or by mail, by or at the direction of the President
or the Secretary to each stockholder or record entitled to vote at such
meeting. If mailed, such notice shall be deemed to be delivered when deposited
in the United States mail, addressed to the stockholder at his address as it
appears on the records of the Corporation, with postage prepaid. Any
stockholder may at any time, by duly signed statement in writing to that
effect, waive any statutory or other notice of any meeting, whether such
statement be signed before or after such meeting.
SECTION 6. MEETING OF ALL STOCKHOLDERS. If all the stockholders shall
meet at any time and place, either within or without the State of Nevada, and
consent to the holding of the meeting at such time and place, such meeting
shall be valid without call or notice and at such meeting any corporate action
may be taken.
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SECTION 7. QUORUM. At all stockholder's meetings, the presence in
person or by proxy of the holders of a majority of the outstanding stock
entitled to vote shall be necessary to constitute a quorum for the transaction
of business, but a lesser number may adjourn to some future time not less than
seven (7) no more than twenty-one (21) days later, and the Secretary shall
thereupon give at least three (3) days' notice by mail to each stockholder
entitled to vote who is absent from such meeting.
SECTION 8. MODE OF VOTING. At all meetings of the stockholders the
voting may be voice vote, but any qualified voter may demand a stock vote
whereupon such stock vote shall be taken by ballot, each of which shall state
the name of the stockholder voting and the number of shares voted by him and,
if such ballot be cast by proxy, it shall also state the name of such proxy;
provided, however, that the mode of voting prescribed by statute for any
particular case shall be in such case followed.
SECTION 9. PROXIES. At any meeting of the stockholders, any stockholder
may be represented and vote by a proxy or proxies appointed by an instrument
in writing. In the event any such instrument in writing shall designate two or
more persons to act as proxies, a majority of such persons present at the
meeting, or, if only one shall be present, then that one shall have and may
exercise all of the powers conferred by such written instrument upon all of
the persons so designated unless the instrument shall otherwise provide. No
such proxy shall be valid after the expiration of six months from the date of
its execution, unless coupled with an interest, or unless the person executing
it specified therein the length of time for which it is to continue in force,
which in no case shall exceed seven years from the date of its execution.
Subject to the above, any proxy duly executed is not revoked and continues in
full force and effect until any instrument revoking it or a duly executed
proxy bearing a later date is filed with the secretary of the Corporation. At
no time shall any proxy be valid which shall be filed less than ten (10) hours
before the commencement of the meeting.
SECTION 10. VOTING LISTS. The officer or agent in charge of the
transfer books for shares of the corporation shall make, at least
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three days before each meeting of stockholders, a complete list of the
stockholders entitled to vote at such meeting, arranged in alphabetical order
with the number of shares held by each, which list for a period of two days
prior to such meeting shall be kept on file at the registered office of the
corporation and shall be subject to inspection by any stockholder at any time
during the whole time of the meeting. The original share ledger or transfer
book, or duplicate thereof, kept in this state, shall be prima facie evidence
as to who are the stockholder entitled to examine such list or share ledger or
transfer book or to vote at any meeting of stockholders.
SECTION 11. CLOSING TRANSFER BOOKS OR FIXING OF RECORD DATE. For the
purpose of determining stockholders entitled to notice or to vote for any
meeting of stockholders, the Board of Directors of the Corporation may provide
that the stock transfer books be closed for a stated period but not to exceed
in any case sixty (60) days before such determination. If the stock transfer
books be closed for the purpose of determining stockholders entitled to notice
of a meeting of stockholders, such books shall be closed for at least fifteen
days immediately preceding such meeting. In lieu of closing the stock transfer
books, the Board of Directors may fix in advance a date in any case to be not
more than sixty (60) days, not less than ten (10) days prior to the date on
which the particular action, requiring such determination of stockholders, is
to be taken. If the stock transfer books are not closed and no record date is
fixed for determination of stockholders entitled to notice of a meeting of
stockholders, or stockholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on which the
resolution of the. Board of Directors declaring such dividend is adopted, as
the case may be, shall be the record of date for such determinations of
shareholders.
SECTION 12. VOTING OF SHARES BY CERTAIN HOLDERS. Shares standing in the
name of another corporation, domestic or foreign, may be voted by such
officer, agent or proxy as the Bylaws of such corporation by prescribe, or, in
the absence of such provisions, as the Board of Directors of such corporation
may determine.
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Shares standing in the name of a deceased person may be voted by his
administrator or executor, either in person or by proxy. Shares standing in
the name of a guardian, conservator or trustee may be voted by such fiduciary
either in person or by proxy, but no guardian, conservator, or trustee shall
be entitled, as such fiduciary, to vote shares held by him without a transfer
of such shares into his name.
Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be voted
by such receiver without the transfer thereof into his name if authority so to
do be contained in an appropriate order of the court at which such receiver
was appointed.
A stockholder whose shares are pledged shall be entitled to vote such
shares until shares have been transferred into the name of the pledgee, and
thereafter the pledgee shall be entitled to vote the shares so transferred.
Shares of its own stock belonging to this corporation shall not voted,
directly or indirectly, at any meeting and shall not be counted in determining
the total number of outstanding shares at any time, but shares of its own
stock held by it in a fiduciary capacity may be voted and shall be counted in
determining the total number of outstanding shares at any given time.
SECTION 13. INFORMAL ACTION BY STOCKHOLDERS. Any action is required to
be taken at a meeting of the stockholders or any other action which may be
taken at a meeting of the stockholders except the election of directors may be
taken without a meeting if a consent in writing setting forth the action so
taken shall be signed by all of the stockholders entitled to vote with respect
to the subject matter thereof.
SECTION 14. VOTING OF SHARES. Each outstanding share entitled to vote
shall be entitled to one vote upon. each matter submitted to vote at a meeting
of stockholders.
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ARTICLE III
DIRECTORS
SECTION 1. GENERAL POWERS. The Board of Directors shall have the
control and general management of the affairs and business of the Corporation.
Such directors shall in all cases act as Board, regularly convened, by a
majority, and they may adopt such rules and regulations for the conduct of
their meetings and the management of the Corporation, as they may deem proper,
not inconsistent with these Bylaws, Articles of Incorporation and the laws of
the State of Nevada. The Board of Directors shall further have the, right to
delegate certain other powers to the Executive
Committee as provided in these Bylaws.
SECTION 2. NUMBER OF DIRECTORS. The affairs and business of this
Corporation shall be managed by a Board of Directors consisting of five (5)
full-age members, until changed by amendment of the Articles of Incorporation
or by an amendment to these Bylaws adopted by the shareholders amending this
Section 2, Article III, and except as authorized by the Nevada Revised
Statutes, there shall in no event be less than one (1) Director.
SECTION 3. ELECTION. The Directors of the Corporation shall be elected
at the annual meeting of the stockholders except as hereinafter otherwise
provided for the filling of vacancies. Each director shall hold office for a
term of one year and until his successor shall have been duly chosen and shall
have qualified, or until his death, or until he shall resign or shall have
been removed in the manner hereinafter provided.
SECTION 4. VACANCIES IN THE BOARD. Any vacancy in the Board of
Directors occurring during the year through death, resignation, removal or
other cause, including vacancies caused by an increase in the number of
directors, shall be filled for the unexpired portion they constitute a quorum,
at any special meeting of the Board called for that purpose, or at any regular
meeting thereof, provided, however, that in the event the remaining directors
do not represent a quorum of the number set forth in Section 2 hereof, a
majority of such remaining directors may elect directors
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to fill any vacancies then existing.
SECTION 5. DIRECTORS MEETINGS. Annual meeting of the Board of Directors
shall be held each year immediately following the annual meeting of the
stockholders. Other regular meetings of the Board of Directors shall from time
to time by resolution be prescribed. No further notice of such annual or
regular meeting of the Board of Directors need be given.
SECTION 6. SPECIAL MEETINGS. Special meetings of the Board of Directors
may be called by or at the request of the President or any director. The
person or persons authorized to call special meetings of the Board of
Directors may fix any place, either within or without the. State of Nevada, as
the place for holding any special meeting of the Board of Directors called by
them.
SECTION 7. NOTICE. Notice of any special meeting shall be given at
least twenty-four hours previous thereto by written notice if personally
delivered, or five days previous thereto if mailed to each director at his
business address, or by telegram. If mailed, such notice shall be deemed to
have been delivered when deposited in the United States mail so addressed with
postage thereon prepaid. If notice is given by telegram, such notice shall be
deemed to be delivered when the telegram is delivered to the telegraph
company. Any director may waive notice of any meeting. The attendance of a
director at any meeting shall constitute a waive of notice of such meeting,
except where a director attends a meeting for the express purpose of objecting
to the transaction of any business because the meeting is not lawfully called
or convened.
SECTION 8. CHAIRMAN. At all meetings of the Board of Directors, the
President shall serve as Chairman, or in the absence of the President, the
directors present shall choose by majority vote a director to preside as
Chairman.
SECTION 9. QUORUM AND MANNER OF ACTING. A majority of the directors,
whose number is designated in Section 2 herein, shall constitute a quorum for
the transaction of business at any meeting and
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the act of a majority of the directors present at any meeting at which a
quorum is present shall be the act of the Board of Directors. In the absence
of a quorum, the majority of the directors present may adjourn any meeting
from time to time until a quorum be had. Notice of any adjourned meeting need
not be given. The directors shall act only as a Board and the individual
directors shall have no power as such.
SECTION 10. REMOVAL OF DIRECTORS. Any one or more of the directors may
be removed either with or without cause at any time by the vote or written
consent of the stockholders representing not less than two-thirds (2/3) of the
issued and outstanding capital stock entitled to voting power.
SECTION 11. VOTING. At all meetings of the Board of Directors, each
director is to have one vote, irrespective of the number of shares of stock
that he may hold.
SECTION 12. COMPENSATION. By resolution of the Board of Directors, the
directors may be paid their expenses, if any of attendance at each meeting of
the Board, and may be paid a fixed sum for attendance at meetings or a stated
salary of directors. No such payment shall preclude any director from serving
the corporation in any other capacity and receiving compensation therefor.
SECTION 13. PRESUMPTION OF ASSENT. A director of the Corporation who is
present at a meeting of the Board of Directors at which action on any
corporate matter is taken, shall be conclusively presumed to have assented to
the action unless his dissent shall be entered in the minutes of the meeting
or unless he shall file his written dissent to such action with the person
acting as the secretary of the meeting before the adjournment thereof or shall
file forward such dissent by certified or registered mail to the Secretary of
the Corporation immediately after the adjournment of the meeting. Such right
to dissent shall not apply to a director who voted in favor of such action.
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ARTICLE IV
EXECUTIVE COMMITTEE
SECTION 1. NUMBER AND ELECTION. The Board of Directors may, in its
discretion, appoint from its membership an Executive Committee of one or more
directors, each to serve at the pleasure of the Board of Directors.
SECTION 2. AUTHORITY. The Executive Committee is authorized to take any
action which the Board of Directors could take, except that the Executive
Committee shall not have the power either to issue or authorize the issuance
of shares of capital stock, to amend the Bylaws, or a resolution of the Board
of Directors. Any authorized action taken by the Executive Committee shall be
as effective as if it had been taken by the full Board of Directors.
SECTION 3. REGULAR MEETINGS. Regular meetings of the Executive
Committee may be held within or without the State of Nevada at such time and
place as the Executive Committee may provide from time to time.
SECTION 4. SPECIAL MEETINGS. Special meetings of the executive
committee may be called by or at the request of the President or any member of
the Executive Committee.
SECTION 5. NOTICE. Notice of any special meeting shall be given at
least one day previous thereto by written notice, telephone, telegram or in
person. Neither the business to be transacted, nor the purpose of a regular or
special meeting of the Executive Committee need be specified in the notice or
waiver of notice of such meeting. A member may waive notice of any meeting of
the Executive Committee. The attendance of a member at any meeting shall
constitute a waiver of notice of such meeting, except where a member attends a
meeting for the express purpose of objecting to the transaction of any
business because the meeting is not lawfully called or convened.
SECTION 6. QUORUM. A majority of the members of the Executive Committee
shall constitute a quorum for the transaction of
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business at any meeting of the Executive Committee; provided that if fewer
than a majority of the members are present at said meeting a majority of the
members present may adjourn the meeting from time to time without further
notice.
SECTION 7. MANNER OF ACTING. The act of the majority of the members
present at a meeting at which a quorum is present shall be the act of the
Executive Committee, and said Committee shall keep regular minutes of its
proceedings which shall at all times be open for inspection by the Board of
Directors.
SECTION 8. PRESUMPTION OF ASSENT. A member of the Executive Committee
who is present at a meeting of the Executive Committee at which action on any
corporate matter is taken, shall be conclusively presumed to have assented to
the action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as secretary of the meeting before the adjournment thereof, or
shall forward such dissent by certified or registered mail to the Secretary of
the Corporation immediately after the adjournment of the meeting. Such right
to dissent shall not apply to a member of the Executive Committee who voted in
favor of such action.
ARTICLE V
OFFICERS
SECTION 1. NUMBER. The officers of the corporation shall be a
President, Vice President, a Treasurer and a Secretary and such other or
subordinate officers as the Board of Directors may from time to time elect.
One person may hold the office and perform the duties of one or more of said
officers. No officer need be a member of the Board of Directors.
SECTION 2. ELECTION TERM OF OFFICE, QUALIFICATIONS. The officers of
the Corporation shall be chosen by the Board of Directors and they shall be
elected annually at the meeting of the Board of Directors held immediately
after each annual meeting of the stockholders except as hereinafter otherwise
provided for filling vacancies.
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Each officer shall hold his office until his successor has been duly chosen
and has qualified, or until his death, or until he resigns or has been removed
in the manner hereinafter provided.
SECTION 3. REMOVALS. Any officer or agent elected or appointed by the
Board of Directors may be removed by the Board of Directors at any time
whenever in its judgment the best interests of the Corporation would be served
thereby, and such removal shall be without prejudice to the contract rights,
if any, or the person so removed.
SECTION 4. VACANCIES. All vacancies in any of office shall be filled by
the Board of Directors without undue delay, at any regular meeting, or at a
meeting specially called for that purpose.
SECTION 5. PRESIDENT. The President shall be the chief executive
officer of the corporation and shall have general supervision over the
business of the corporation and over its several officers, subject, however,
to the control of the Board of Directors. He may sign, with the Treasurer or
with the Secretary or any other proper officer of the Corporation thereunto
authorized by the Board of Directors, certificates for shares of the capital
stock of the Corporation; may sign and execute in the name of the Corporation
deeds, mortgages, bonds, contracts or other instruments authorized by the
Board of Directors, except in cases where signing and execution thereof shall
be expressly delegated by the Board of Directors or by these Bylaws to some
other officer or agent of the Corporation; and in general shall perform all
duties incident to the duties of the President, and such other duties as from
time to time may be assigned to him by the Board of Directors.
SECTION 6. VICE PRESIDENT. The Vice President shall in the absence or
incapacity of the President, or as ordered by the Board of Directors, perform
the duties of the President, or such other duties or functions as may be given
to him by the Board of Directors from time to time.
SECTION 7. TREASURER. The Treasurer shall have the care and custody of
all the funds and securities of the Corporation and deposit the same in the
name of the Corporation in such bank or trust company
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as the Board of Directors may designate; he may sign or countersign all
checks, drafts and orders for the payment of money and may pay out and dispose
of same under the direction of the Board of Directors, and may sign or
countersign all notes or other obligations of indebtedness of the Corporation;
he may sign with the President or Vice President, certificates for shares of
stock of the Corporation; he shall at all reasonable times exhibit the books
and accounts to any director or stockholder of the Corporation under
application at the office of the company during business hours; and he shall,
in general, perform all duties as from time to time may be assigned to him by
the President or by the Board of Directors. The Board of Directors may at its
discretion require that each officer authorized to disburse the funds of the
Corporation be bonded in such amount as it may deem adequate.
SECTION 8. SECRETARY. The Secretary shall keep the minutes of the
meetings of the Board of Directors and also the minutes of the meetings of the
stockholders; he shall attend to the giving and serving of all notices of the
Corporation and shall affix the seal of the Corporation to all certificates of
stock, when signed and countersigned by the duly authorized officers; he may
sign certificates for shares of stock of the Corporation; he may sign or
countersign all checks, drafts and orders for the payment of money; he shall
have charge of the certificate book and such other books and papers as the
Board may direct; he shall keep a stock book containing the names
alphabetically arranged, of all persons who are stockholders of the
Corporation, showing their places of residence, the number of shares of stock
held by them respectively, the time when they respectively became the owners
thereof, and the amount paid thereof; and he shall, in general, perform all
duties incident to the office of Secretary and such other duties as from time
to time may be assigned to him by the President or by the Board of Directors.
SECTION 9. OTHER OFFICERS. The Board of Directors may authorize and
empower other persons or other officers appointed by it to perform the duties
and functions of the officers specifically designated above by special
resolution in each case.
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SECTION 10. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES. The
Assistant Treasurers shall respectively, as may be required by the Board of
Directors, give bonds for the faithful discharge of their duties, in such sums
and with such sureties as the Board of Directors shall determine. The
Assistant Secretaries as thereunto authorized by the Board of Directors may
sign with the President or Vice President certificates for shares of the
capital stock of the Corporation, issue of which shall have been authorized by
resolution of the Board of Directors. The Assistant Treasurers and Assistant
Secretaries shall, in general, perform such duties as may be assigned to them
by the Treasurer or the Secretary respectively, or by the President or by the
Board of Directors.
ARTICLE VI
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Except as hereinafter stated otherwise, the Corporation shall indemnify
all of its officers and directors, past, present and future, against any and
all expenses incurred by them, and each of them including but not limited to
legal fees, judgments and penalties which may be incurred, rendered or levied
in any legal action brought against any or all of them for or on account of
any act or omission alleged to have been committed while acting within the
scope of their duties as officers or directors of this Corporation.
ARTICLE VII
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. CONTRACTS. The Board of Directors may authorize any officer
or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the Corporation, and
such authority may be general or confined to specific instances.
SECTION 2. LOANS. No loans shall be contracted on behalf of the
Corporation and no evidence of indebtedness shall be issued in its
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name unless authorized by the Board of Directors or approved by loan committee
appointed by the Board of Directors and charged with the duty of supervising
investments. Such authority may be general or confined to specific instances.
SECTION 3. CHECKS, DRAFTS, ETC. A checks, drafts or other orders for
payment of money, notes or other evidences of indebtedness issued in the name
of the Corporation shall be signed by such officer or officers, agent or
agents of the Corporation and in such manner as shall from time to time be
determined by resolutions of the Board of Directors.
SECTION 4. DEPOSITS. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the Corporation
in such banks, trust companies or other depositories as the Board of Directors
may select.
ARTICLE VIII
CAPITAL STOCK
SECTION 1. CERTIFICATES FOR SHARES. Certificates for shares of stocks
of the Corporation shall be in such form as shall be approved by the
incorporators or by the Board of Directors. The certificates shall be numbered
in the order of their issue, shall be signed by the President or the Vice
President and by the Secretary or the Treasurer, or by such other person or
officer as may be designated by the Board of Directors; and the seal of the
Corporation shall be affixed thereto, which said signatures of the
duly designated officers and of the seal of the Corporation. Every certificate
authenticated by a facsimile of such signatures and seal must be countersigned
by a Transfer Agent to be appointed by the Board of Directors, before
issuance.
SECTION 2. TRANSFER OF STOCK. Shares of the stock of the Corporation
may be transferred by the delivery of the certificate accompanied either by an
assignment in writing on the back of the certificate or by written power of
attorney to sell, assign, and transfer the same on the books of the
Corporation, signed by the person appearing by the certificate
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to the owner of the shares represented thereby, together with all necessary
federal and state transfer tax stamps affixed and shall be transferable on the
books of the Corporation upon surrender thereof so signed or endorsed. The
person registered on the books of the Corporation as the owner of any shares
of stock shall be entitled to all rights of ownership with respect to such
shares.
SECTION 3. REGULATIONS. The Board of Directors may make such rules and
regulations as it may deem expedient not inconsistent with the Bylaws or with
the Articles of Incorporation, concerning the issue, transfer and registration
of the certificates for shares of stock of the Corporation. It may appoint a
transfer agent or a registrar of transfers, or both, and it may require all
certificates to bear the signature of either or both.
SECTION 4. LOST CERTIFICATES. The Board of Directors may direct a new
certificate or certificates to be issued in place of any certificate or
certificates theretofore issued by the Corporation alleged to have been lost
or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate of stock to be lost or destroyed. When authorizing
such issue of a new certificate or certificates, the Board of Directors may,
in its discretion and as a condition precedent to the issuance thereof,
require the owner of such lost or destroyed certificate or certificates, or
his legal representative, to advertise the same in such manner as it shall
require and/or give the Corporation a bond in such sum as it may direct as
indemnity against any claim that may be made against the Corporation with
respect to the certificate alleged to have been lost or destroyed.
ARTICLE IX
DIVIDENDS
SECTION 1. The Corporation shall be entitled to treat the holder of any
share or shares of stock as the holder in fact thereof and, accordingly,
shall not be bound to recognize any equitable or other claim to or interest in
such shares on the part of any other person, whether or not
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it shall have express or other notice thereof, except as expressly provided by
the laws of Nevada.
SECTION 2. Dividends on the capital stock of the Corporation, subject
to the provisions of the Articles of Incorporation, if any, may be declared by
the Board of Directors at any regular or special meeting, pursuant to law.
SECTION 3. The Board of Directors may close the transfer books in its
discretion for a period not exceeding fifteen days preceding the date fixed
for holding any meeting, annual or special of the stockholders, or the day
appointed for the payment of a dividend.
SECTION 4. Before payment of any dividend or making any distribution of
profits, there may be set aside out of funds of the Corporation available for
dividends, such sum or sums as the directors may from time to time, in their
absolute discretion, think proper as a reserve fund to meet contingencies, or
for equalizing dividends, or for repairing or maintaining any property of the
Corporation, or for any such other purpose as the directors shall think
conducive to the interest of the Corporation, and the directors may modify or
abolish any such reserve in the manner in which it was created.
ARTICLE X
SEAL
The Board of Directors shall provide a Corporate seal which shall be in
the form of a Circle and shall bear the full name of the Corporation, the year
of its incorporation and the words "Corporate Seal, State of Nevada".
ARTICLE XI
FISCAL YEAR
The fiscal year of the Corporation shall end on the 31st day of
December of each year.
ARTICLE XII
WAIVER OF NOTICE
Whenever any notice whatever is required to be given under the
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provisions of these Bylaws, or under the laws of the State of Nevada, or under
the provisions of the Articles of Incorporation, a waiver in writing signed by
the person or persons entitled to such notice, whether before or after the
time stated therein, shall be deemed equivalent to the giving of such notice.
ARTICLE XIII
AMENDMENTS
These Bylaws may be altered, amended or repealed and new Bylaws may be
adopted at any regular or special meeting of the Stockholders by a vote of the
stockholders owning a majority of the shares and entitled to vote thereat.
These Bylaws may also be altered, amended or repealed and new Bylaws may be
adopted at any regular or special meeting of the Board of Directors of the
Corporation (If notice of such alteration or repeal be contained in the notice
of such special meeting) by a majority vote of the directors present at the
meeting at which a quorum is present, but any such amendment shall not be
inconsistent with or contrary to the provision of any amendment adopted by the
stockholders.
KNOW ALL MEN BY THESE PRESENTS that the undersigned, being the
Secretary of Color Strategies, a Nevada corporation, hereby acknowledges that
the above and foregoing Bylaws were duly adopted as the Bylaws of said
Corporation on 3/24/98.
IN WITNESS WHEREOF, I here unto subscribe my name this 24th day of
March, 1998.
/s/ Tami Tischner
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17
Exhibit 10
REAL ESTATE LEASE
This Lease Agreement (this "Lease") is made effective as of November 1, 1998,
by and between Wagon Master ("Landlord"), and Color Strategies "Tenant"). The
parties agree as follows:
PREMISES. Landlord, in consideration of the lease payments provided in this
Lease, leases to Tenant working space, office space, and office equipment &
materials (the "Premises") located at 3050 East 630 North St. George, UT.
84790
TERM. The lease term will begin on November 1, 1998 and will on month to month
basis.
LEASE PAYMENTS. Tenant shall pay to Landlord in installments of $400.00 per
month on the last day of each month after deferred period. Lease payments
shall be made to the Landlord at 3050 East 630 North St. George, UT. 84790, as
may be changed from time to time by Landlord.
POSSESSION. Tenant shall be entitled to possession on the first day of the
term of this Lease, and shall yield possession to Landlord on the last day of
the term of this Lease, unless otherwise agreed by both parties in writing.
PROPERTY INSURANCE. Landlord and Tenant shall each be responsible to maintain
appropriate insurance for their respective interests in the Premises and
property located on the Premises.
DEFAULTS. Tenant shall be in default of this Lease, if Tenant fails to fulfill
any lease obligation or term by which Tenant is bound. Subject to any
governing provisions of law to the contrary, if Tenant fails to cure any
financial obligation within 15 day(s) (or any other obligation within 15
day(s)) after written notice of such default is provided by Landlord to
Tenant, Landlord may take possession of the Premises without further notice,
and without prejudicing Landlords rights to damages. In the alternative,
Landlord may elect to cure any default and the cost of such action shall be
added to Tenant's financial obligations under this Lease. Tenant shall pay all
costs, damages, and expenses suffered by Landlord by reason of Tenant's
defaults.
NOTICE. Notices under this Lease shall not be deemed valid unless given or
served in writing and forwarded by mail, postage prepaid, addressed as
follows:
LANDLORD:
Wagon Master
3050 E. 630 N.
St. George, UT. 84790
TENANT:
Color Strategies
5015 W. Sahara Ave., #219
Las Vegas, NV. 89146
Such addresses may be changed from time to time by either party by providing
notice as set forth above.
ENTIRE AGREEMENT/AMENDMENT. This Lease Agreement contains the entire agreement
of the parties and there are no other promises or conditions in any other
agreement whether oral or written. This Lease may be modified or amended in
writing, if the writing is signed by the party obligated under the amendment.
SEVERABILITY. If any portion of this Lease shall be held to be invalid or
unenforceable for any reason, the remaining provisions shall continue to be
valid and enforceable. If a court finds that any provision of this Lease is
invalid or unenforceable, but that by limiting such provision, it would become
valid and enforceable, then such provision shall be deemed to be written,
construed, and enforced as so limited.
WAIVER. The failure of either party to enforce any provisions of this Lease
shall not be construed as a waiver or limitation of that party's right to
subsequently enforce and compel strict compliance with every provision of this
Lease.
CUMULATIVE RIGHTS. The rights of the parties under this Lease are cumulative,
and shall not be construed as exclusive unless otherwise required by law.
GOVERNING LAW. This Lease shall be construed in accordance with the laws of
the state of Utah.
LANDLORD: Wagon Master
/s/ Jerry Tischner
- --------------------
TENANT: Color Strategies
/s/ Tami Tischner
- ------------------
President
Exhibit 16
[Letterhead S.J. Meyer & Co.]
S.J. Meyer & Co.
Accountants and Consultants
___________________________
2660 South Rainbow Blvd., Suite H-108
LAS VEGAS, NEVADA 89102
(702) 227-0117
FAX (702)227-0118
February 22, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Re: Color Strategies
Dear Sirs:
We have reviewed Item 3 - Change in and disagreements with accountants, of the
Form 10-SB. We are in agreement with the statements presented therein so far
as statements pertain to S. J. Meyer and Co.
Sincerely,
/s/ Stephen J. Meyer
S.J. Meyer & Co.
By Stephen J. Meyer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary information extracted from the Company's audited
financial statements for its year ended December 31, 1998 and is qualified in
its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> MAR-24-1998
<PERIOD-END> DEC-31-1998
<CASH> 46,184
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,055
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 47,239
<CURRENT-LIABILITIES> 885
<BONDS> 0
0
0
<COMMON> 402
<OTHER-SE> 45,952
<TOTAL-LIABILITY-AND-EQUITY> 47,239
<SALES> 450
<TOTAL-REVENUES> 450
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,658
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (2,208)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,208)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,208)
<EPS-PRIMARY> (.005)
<EPS-DILUTED> (.005)
</TABLE>
