ACTION BY UNANIMOUS CONSENT OF THE
BOARD OF DIRECTORS AND SOLE STOCKHOLDER OF
THE BALANCED WOMAN
The undersigned, being the sole director and the sole stockholder
of The Balanced Woman, Inc., a Colorado corporation ("Balanced Woman"), acting
pursuant to the Colorado Corporation Code, the provisions of the Articles of
Incorporation, as amended, and the Bylaws of Balanced Woman, do hereby
unanimously consent to and adopt the following resolutions, effective the date
hereof unless indicated otherwise:
Recitals:
Balanced Living, Inc., a Colorado corporation and the parent of
Balanced Woman, would like to convey Balanced Woman to the stockholders of
Balanced Woman, solely in exchange for warrants or options to acquire shares
of Balanced Living that are owned by these stockholders. Balanced Woman would
continue operations as a private corporation, owned by these stockholders,
while these stockholders would retain their present share ownership in
Balanced Living, resulting in their having two investment opportunities from
which to potentially profit. The reasons for this action are as follows:
1. The public filing costs and expenses of Balanced Living that
are related to its operations through its wholly-owned subsidiary, the
Balanced Woman, are very disproportionate to the value received for being a
publicly-held company, especially in light of the present limited public
market for the common stock of Balanced Living.
2. The legal and accounting expenses attendant to being a
publicly-held company have increased greatly during the past two years because
of increased regulation and scrutiny of publicly-held companies by the
Securities and Exchange Commission, and more recently, with its requirement
that all quarterly reports that are required to be filed be reviewed by an
independent accounting firm. Further, Balanced Living is required at its cost
to maintain the SB-2 Registration Statement it filed with the Securities and
Exchange Commission and its Prospectus current by post-effective amendments so
that the shares underlying the Class A, B and C warrants that were a part of
the units (the "Units") publicly offered and sold by Balanced Living can be
exercised, despite the fact that the exercise price of all of these warrants
is substantially higher than the present limited public market price for
Balanced Living's common stock. The anticipated legal, accounting and
printing costs related to any such post-effective amendments would be very
expensive, with the possibility of Balanced Living receiving no benefit
because none of the warrants would be exercised.
3. Expenses of Balanced Woman and its operations have required
numerous loans, mostly from related parties.
4. Balanced Living has had preliminary discussions with a
number of financial consulting firms respecting the possibility of an
acquisition, reorganization or merger that would benefit Balanced Living and
its stockholders with one or more privately-held entities desiring to become a
publicly-held company through a "reverse" reorganization or merger.
5. All of these discussions have indicated that any such
"reverse" proposal will require the sale or disposition of the Balanced Woman,
the cancellation of all outstanding warrants and options because of the cost
of maintaining an effective and current SB-2 Registration Statement covering
the shares underlying these warrants and options and the satisfaction of all
liabilities of Balanced Living.
6. The Balanced Woman, with its present line of products, would
have a greater chance of success if its costs were reduced by becoming a
privately-held company, owned by the current stockholders and the warrant and
option holders of Balanced Living.
7. Balanced Living believes it would be in the best interests
of its stockholders and its warrant and option holders to exchange all of the
outstanding securities of Balanced Woman for the outstanding warrants and
options to acquire shares of common stock of Balanced Living.
8. There is no present market for Balanced Living's common
stock, though its shares are nominally quoted on the OTC Bulletin Board of the
National Association of Securities Dealers, Inc. (the "NASD").
9. The lowest exercise price for any of the outstanding
warrants or options is $1.00, and the exercise price of the Class A, B and C
warrants that were a portion of the Units publicly offered and sold pursuant
to Balanced Living's SB-2 Registration Statement are $3.00, $5.00 and $10.00,
respectively.
10. One Class A, B and C warrant should be considered to
be one warrant for the purpose of the proposed exchange, by reason of the
difference between the exercise prices of these warrants and those of the
other outstanding warrants and options that are exercisable at $1.00.
11. The exchange of outstanding warrants for the shares
owned by Balanced Living in this fashion is more than fair to the stockholders
who purchased Units and who own the Class A, B and C warrants because their
aggregate ownership interest in the Balanced Woman would be approximately 20%
rather than their present aggregate ownership interest in Balanced Living of
approximately 11%, while all such stockholders would still retain their
respective shares of common stock in Balanced Living and have an opportunity
to benefit from any "reverse" reorganization or merger transaction involving
Balanced Living. Further, the tax ramifications of the exchange would be
nominal to these stockholders because any gain would be taxed as a long term
gain. Also, the warrants or options do not have any present value; there is
no present market for the Balanced Woman's outstanding securities, except as
it may relate to a portion of the value of Balanced Living's common stock, for
which there are no current bid or asked prices on the NASD's OTC Bulletin
Board; and the present book value of Balanced Living, on a consolidated basis
with the Balanced Woman, is a negative of ($207,826).
12. If all of the holders of the outstanding warrants and
options do not agree to the exchange, the principal stockholders of Balanced
Living, Jeannene Barham and Rose N. Blackham, pro rata, shall cancel to the
treasury sufficient shares to cover the number of shares underlying any such
outstanding warrants or options that are not exchanged for a pro rata interest
in the Balanced Woman, and they shall receive, pro rata, one share in the
Balanced Woman by reason of each canceled share.
13. Each Balanced Living warrant or option holder (with the
Class A, B and C warrants to be considered to be an aggregate of one warrant
for the purpose of the proposed exchange) shall receive one share of the
Balanced Woman for each warrant or option that each owns of Balanced Living.
Any remaining shares of the Balanced Woman that are owned by Balanced Living
following the one for one exchange shall be canceled to the treasury of the
Balanced Woman and returned to its authorized capital as authorized but
unissued shares.
14. Balanced Living has retained legal counsel with
respect to the foregoing, and it is reasonable that this counsel be issued
100,000 shares of common stock of Balanced Living in consideration of all
services related to the sale of the Balanced Woman; that such shares be
registered on Form S-8 of the Securities and Exchange Commission; that such
counsel prepare and file the required registration statement on Form S-8; and
that Balanced Living require any candidate for a "reverse" reorganization or
merger to pay all other related legal costs and expenses incurred in
connection with any such reorganization or merger.
Resolutions
RESOLVED, that Balanced Woman execute and deliver an Agreement and
Plan of Exchange or Reorganization, a copy of which is attached
hereto and incorporated herein (the "Agreement"), whereby Balanced
Living will exchange all of the Balance Woman's outstanding
securities, pro rata, for all of the outstanding warrants or
options to acquire authorized but unissued securities of Balanced
Living, on a one for one basis, assuming that the aggregate of one
Class A, B and C warrant is only deemed to be one warrant for the
purpose of calculating the number of shares of the Balanced Woman
to be exchanged under the Agreement;
FURTHER, RESOLVED, that in the good faith judgment of the sole
director of Balanced Woman and its sole stockholder, the common
stock of the Balanced Woman is determined to have a fair value of
$0.10 per share for the purposes of this exchange only, and the
Agreement is fair, just and equitable, and in the best interests
of Balanced Woman and its stockholder;
FURTHER, RESOLVED, to the extent possible, that the Agreement
shall be effective as of March 31, 2000, for accounting purposes;
FURTHER, RESOLVED, that the executive officer of Balanced Woman be
and hereby is authorized and directed to execute and deliver the
Agreement and all other documents required or deemed necessary to
complete the Agreement for and on behalf of Balanced Woman
pursuant to which Balanced Living shall acquire in exchange for
its holdings in the Balanced Woman such warrants and options that
are outstanding and that grant such warrant and option holders the
right to acquire shares of common stock of Balanced Living in a
stock for stock exchange within the meaning of Section
368(a)(1)(B) of the Internal Revenue Code of 1986, as amended, or
any other applicable law, rule or regulation; and
FURTHER, RESOLVED, that the Balanced Woman shall assume and pay
all outstanding liabilities of the Balanced Woman and those of
Balanced Living that are in any way related to the operations of
the Balanced Woman, on a consolidated basis or otherwise, and
indemnify and hold Balanced Living therefrom; and Balanced Woman
shall provide letters of compromise and/or settlement from each of
its creditors to the effect that Balanced Living has no obligation
whatsoever for any such liabilities.
Date: May 26, 2000 /S/Jeannene Barham
Jeannene Barham, Sole Director
SOLE STOCKHOLDER:
BALANCED LIVING, INC.
Date: May 26, 2000 By/s/Jeannene Barham
Jeannene Barham, Sole Director
Shares Owned: 500,000 - 100%
