U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to ________________
Commission File No. 000-27641
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Platinum and Gold, Inc.
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(Name of small business registrant in its charter)
Nevada 65-0729332
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
12724 N.W. 11th Court
Sunrise, FL 33323
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number (800) 525-8495
Securities registered under Section 12(b) of the Exchange Act:
Title of each class Name of each exchange
on which registered
None
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Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.001 par value
(Title of class)
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Copies of Communications Sent to:
Mintmire & Associates
265 Sunrise Avenue, Suite 204,
Palm Beach, FL 33480
Tel: (561) 832-5696 Fax: (561) 659-5371
<PAGE>
Check whether the registrant (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No
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Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [X]
State registrant's revenues for its most recent fiscal year. $0.00
Of the 12,431,000 shares of voting stock of the registrant issued and
outstanding as of March 30, 2000, 2,401,000 shares are held by non-affiliates.
Because of the absence of an established trading market for the voting stock,
the registrant is unable to calculate the aggregate market value of the voting
stock held by non-affiliates as of a specified date within the past 60 days.
<PAGE>
PART I
Item 1. Description of Business
(a) Business Development
Platinum and Gold, Inc. (the "Company" or "P&G") is incorporated in the
State of Nevada. The Company was originally incorporated as Integra Ventures,
Inc. on February 19, 1997 ("Integra"). The Company is not presently trading on
an exchange, but has applied to have its Common Stock quoted on the Over the
Counter Bulletin Board by submitting its 15c2-11 application to the National
Association of Securities Dealers. Its executive offices are presently located
at 12724 N.W. 11th Court, Sunrise, FL 33323. Its telephone number is (800)
525-8495 and its facsimile number is (954) 845-0656.
The Company is filing this Form 10-KSB in compliance with the effectiveness
of its filing on Form 10-SB. The Company will file periodic reports in the event
its obligation to file such reports is suspended under the Securities and
Exchange Act of 1934 (the "Exchange Act".)
Initially the Company was engaged in the medical supply business. In
November 1998, at the time it acquired Platinum and Gold Recording & Publishing
Company, a Florida corporation formed in June 1997 ("PGRP") as a wholly-owned
subsidiary, its purpose changed to P&G's initial purpose of discovering,
developing, recording and marketing new talent in the entertainment industry.
PGRP's founding philosophy arose from the diversified experience of its
management in the music, video, film and related industries. See Part I, Item 1.
"Description of the Business - (b) Business of Issuer."
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In February 1997, prior to its acquisition of PGRP, the Company sold
1,720,000 shares of its unrestricted common stock to 70 individuals for $17,200.
For such offering, the Company relied upon Section 3(b) of the Securities Act of
1933, as amended (the "Act"), Rule 504 promulgated thereunder ("Rule 504"),
Section 517.061(11) of the Florida code, Section 90.530(11) of the Nevada code,
Section 48-2-103(b)(4) of the Tennessee code and Section 5[581-5]I(c) of the
Texas code. No state exemption was necessary for the sales made to Canadian or
French investors. See Part III, Item 12. "Certain Relationships and Related
Transactions".
In July 1997, prior to its acquisition of PGRP, the Company conducted a 1
for 4 reverse split of its common stock. This transaction was effected by the
Company's Board of Directors in accordance with the Company's Articles of
Incorporation and Bylaws and also in accordance with Nevada law. See Part II,
Item 5. Market for Common Equity and Related Stockholder Matters, Market
Information"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In July 1997, prior to its acquisition of PGRP, the Company entered into a
share exchange agreement with First Aid Direct, Inc., a Florida corporation
("FAD"), and its shareholders which had been formed in February 1997. The
exchange was made whereby the Company issued 2,970,000 shares of its restricted
common stock to the shareholders of FAD for all of the issued and outstanding
stock of FAD. This offering was conducted pursuant to Section 4(2) of the Act,
Rule 506 of Regulation D promulgated thereunder ("Rule 506") and Section
517.061(11) of the Florida Code. See Part III, Item 12. "Certain Relationships
and Related Transactions".
In August 1998, prior to its acquisition of PGRP, the Company entered into
a Recission and Cancellation Agreement with FAD and its shareholders, thereby
returning the parties to their original positions prior to the share exchange
conducted in July 1997 ab initio. Thus, FAD exchanged 2,970,000 shares of common
stock of the Company for 100% of the issued and outstanding stock of FAD and FAD
was no longer a wholly-owned subsidiary of the Company. See Part III, Item 12.
"Certain Relationships and Related Transactions".
In October 1998, prior to its acquisition of PGRP, the Company conducted a
4 for 1 forward split of its common stock. This transaction was effected by the
Company's Board of Directors in accordance with the Company's Articles of
Incorporation and Bylaws and also in accordance with Nevada law. See Part II,
Item 5. "Market for Common Equity and Related Stockholder Matters, Market
Information"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In October 1998, prior to its acquisition by the Company, PGRP entered into
an agreement with Randy Bernsen to be a Director of PGRP. The term was until the
next annual meeting of the shareholders and directors. As compensation, Randy
Bernsen was promised 10,000 shares of the restricted common stock of the Company
upon the share exchange to be conducted in November 1998. The shares were issued
in January 1999 pursuant to Section 4(2) of the Act, Rule 506 and Section
517.061(11) of the Florida code. See Part I, Item 1. "Description of Business -
(b) Business of Issuer - Employees and Consultants"; Part III, Item 10.
"Executive Compensation - Employee Contracts and Agreements"; Part III, Item 11.
"Security Ownership of Certain Beneficial Owners and Management"; and Part III,
Item 12. "Certain Relationships and Related Transactions".
In November 1998, prior to its acquisition by the Company, PGRP entered
into an agreement with Glenda Grainger to be a Director of PGRP. As
compensation, Glenda Grainger was promised 10,000 shares of the restricted
<PAGE>
common stock of the Company upon the share exchange to be conducted in November
1998. The shares were issued in January 1999 pursuant to Section 4(2) of the
Act, Rule 506 and Section 517.061(11) of the Florida code. See Part I, Item 1.
"Description of Business - (b) Business of Issuer - Employees and Consultants";
Part III, Item 10. "Executive Compensation - Employee Contracts and Agreements";
Part III, Item 11. "Security Ownership of Certain Beneficial Owners and
Management"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In November 1998, the Company entered into a share exchange agreement with
PGRP, and its shareholders which had been formed in June 1997. The exchange was
made whereby the Company issued 10,000,000 shares of its restricted common stock
to the shareholders of PGRP for all of the issued and outstanding stock of PGRP.
As part of the exchange, Ms. Neal the Company's past President and Chairman, Ms.
Peters the Company's current Vice-President, Secretary and Director and Ms.
Cavell, the Company's current President, Treasurer and Chairman received
6,000,000, 2,000,000 and 2,000,000 shares of the Company's restricted common
stock respectively. Ms. Neal passed away in December 1999. Her shares are still
titled in her name pending disposition of her estate. This offering was
conducted pursuant to Section 4(2) of the Act and Rule 506 and Section
517.061(11) of the Florida Code. See Part I, Item 1. "Description of Business -
(b) Business of Issuer - Employees and Consultants"; Part I, Item 6.
"Management's Discussion and Analysis or Plan of Operation - Stockholders'
Equity"; Part III, Item 10. "Executive Compensation - Employee Contracts and
Agreements"; Part III, Item 11. "Security Ownership of Certain Beneficial Owners
and Management"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In January 1999, the Company issued 10,000 shares of its restricted common
stock to Margaret Ann Ronayne in connection with her agreement to serve on the
Company's Board of Directors and a Representation Agreement entered into in
December 1998. The shares were issued pursuant to Section 4(2) of the Act, Rule
506 and Section 517.061(11) of the Florida code. See Part I, Item 1.
"Description of Business - (b) Business of Issuer - Employees and Consultants";
Part III, Item 10. "Executive Compensation - Employee Contracts and Agreements";
Part III, Item 11. "Security Ownership of Certain Beneficial Owners and
Management"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In January 1999, the Company conducted an offering of its unrestricted
common stock pursuant to section 3(b) of the Act and Rule 504. No shares were
sold thereunder. See Part III, Item 12. "Certain Relationships and Related
Transactions".
In April 1999, the Company sold 1,000 shares of its unrestricted common
stock to one (1) investor for $850. For such offering, the Company relied upon
Section 3(b) of the Act, Rule 504 and Section 90.530(11) of the Nevada code. See
Part III, Item 12. "Certain Relationships and Related Transactions".
In July 1999, the Company initiated an offering of its Convertible Notes.
The Notes have a term of one (1) year, bear interest at a rate of nine percent
(9%) and are automatically convertible to shares of the Company's Common Stock
in one (1) year (if they are not converted earlier) at a price of $1.00 per
share plus interest, which interest is also payable in shares of the Company's
Common Stock. To date, one (1) note has been sold in the principal amount of
<PAGE>
$200,000 in December 1999. The offering is ongoing. For such offering, the
Company relied upon Section 3(b) of the Act, Rule 504 and Section 517.061(11) of
the Florida Code. See Part I, Item 6. "Management's Discussion and Analysis or
Plan of Operation Financial Condition, Liquidity and Capital Resources"; and
Part III, Item 12. "Certain Relationships and Related Transactions".
In September 1999, the Company executed a Promissory Note in favor of Carol
Neal, the Company's past Chairman, President and Treasurer in the amount of
$24,600. The Note was in exchange for monies lent by Ms. Neal to the Company for
working capital. The Note has since been repaid by the Company. See Part I, Item
1. "Description of Business - (b) Business of Issuer - Employees and
Consultants"; Part III, Item 10. "Executive Compensation - Employee Contracts
and Agreements"; Part III, Item 11. "Security Ownership of Certain Beneficial
Owners and Management"; and Part III, Item 12. "Certain Relationships and
Related Transactions".
In November 1999, the Company entered into a consulting contract with Joyce
Research Group, Inc. to provide financial public relations services to the
Company. As payment for these services, the Company committed to pay $225,000 or
to issue shares of its "free-trading" Common Stock within a six (6) month
period. An initial payment of $50,000 was made in December 1999. See Part I,
Item 1. "Description of Business - (b) Business of Issuer - Employees and
Consultants"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In November and December 1999, the Company entered into consulting
contracts with three (3) individuals to provide financial, public and investor
relations services to the Company. As payment for such services, the Company
issued 800,000 shares of its Common Stock and paid $20,000 For such offering,
the Company relied upon Section 3(b) of the Act, Rule 701, Pub. L. 104- 290, 110
Stat. 3416 (October 11, 1996) commonly known as the National Securities Markets
Improvement Act of 1996 ("NSMIA"), Section 517.061(11) of the Florida Code and
Section 10-5- 9(13) of the Georgia Code. See Part I, Item 1. "Description of
Business - (b) Business of Issuer - Employees and Consultants"; and Part III,
Item 12. "Certain Relationships and Related Transactions".
See (b) "Business of Registrant" immediately below for a description of the
Company's business.
(b) Business of Registrant
General
The Company was formed in February 1997 and had little or no operations
until November, 1998, when it acquired PGRP. P&G is an entertainment company
involved in the music and film business. Its principal activity is to discover
gifted new artists and to pair those persons with experienced teams of
entertainers in the same or similar fields. The teams will serve as mentors to
the new artists and will help to further develop their skills. Ultimately, the
Company (with the artist) will produce a finished work based on original
material created by the artist, the Company or both or will re-record a previous
hit. Artists contract directly with the Company. This eliminates the expense of
agents and middle men and translates to a substantial savings for both the
Company and the artist.
<PAGE>
Music Recording and Publishing
In the music industry, P&G plans to record its artists both with original
material and with previously released hit songs. Most works will most likely be
aimed at a pop audience, as the Company feels that this segment of the industry
is the most appropriate for the artists P&G currently scouts, is possibly the
most profitable and may be the easiest to enter with a new artist.
P&G will manufacture the recorded material into compact disc ("CD") singles
and albums and cassette singles and albums and then will distribute to the
public via satellite, cable and national TV networks through 1-800 buy-direct
response telephone numbers, as well as over the Internet.
If Only and Touch Me
The Company has already recorded the music for its first two (2) singles,
"If Only" and "Touch Me". The Company is searching for a talented lead vocalist
to record a "voiceover". The singles were recorded in Nashville, TN, with the
help of John Mattick who has worked with such groups as Alabama, Sawyer Brown,
and the Righteous Brothers. He has arranged and produced for Dirty Dancing,
Michael Jackson, Johnny Lee, Andy Reiss, and Reba McIntire. Andy Reiss plays
electric guitar and has also played for Reba McIntire. Dave Fowler plays bass
and has played for Lori Morgan and Dottie West. Rick Lonow plays drums and has
played with Bellami Brothers. Etta Britt is a back-up singer on the single and
has performed with Englebert Humperdink. Larry Hanson plays acoustic guitar and
has played for both Alabama and Righteous Brothers. Chris Hinson who works with
percussion and engineering has worked closely with Clarence Clemmons and DJ
Jazzy Jeff, arranging, writing and performing original music. The singles were
test-marketed in Nashville in 1998 and tested extremely well. The "I wanna buy"
margin was approximately 95%.
Betty Dickson
The Company signed a contract with jazz, blues and swing artist Betty
Dickson to promote and sell her two full-length albums titled "Stolen Goods" and
"A Woman For All Seasons" through direct marketing efforts (the "Dickson
Contract"). The albums were recorded in 1996 and 1998 respectively and are
available in both CD and cassette formats. Neither album has been released to
the public to date, although there have been limited sales to individuals at
concert events at which Ms. Dickson has performed. P&G is obligated to pay Ms.
Dickson $1.00 for each album sold. The contract expires September 3, 2000.
Ms. Dickson is also seeking to become affiliated with a record label. A
record company contract would provide Ms. Dickson with the means to distribute
her albums nationally and internationally, to tour in concert and to possibly
record with other jazz greats and legends, with the whom the record label has
some affiliation. As a term of the Dickson contract, P&G is entitled to receive
20% of the proceeds of any future contract between Ms. Dickson and such record
label.
Ms. Dickson has recorded four (4) full-length albums to date titled "Can't
Get Out of This Mood" in 1993, "Many, Many Kisses" in 1995, "Stolen Goods" in
1996 and "A Woman For All Seasons" in 1998. She is currently preparing material
for her next album which is currently untitled and for which no release date is
available.
<PAGE>
Ms. Dickson resides in Florida, where she often performs in local hotels
and nightclubs, as well as in jazz music festivals and concerts. Additionally,
she tours nationally and has appeared in a "Legends of Jazz" show aboard the SS
Norway. She works regularly with the Eddie Higgins Trio performing for the Ft.
Lauderdale Jazz Society and at other local events.
Steve Jordan
The Company has signed a letter of intent with artist Steve Jordan to enter
into a contract for the purpose of recording a single CD and cassette to be sold
through direct response television advertising and through Internet sales. Mr.
Jordan is currently completing work on his first album and plays in the 1940's
and 1950's contemporary big band genre. He appeals to a wide range of ages and
musical tastes, from gospel to big band.
Mr. Jordan began singing to audiences at the age of three (3) and has been
singing publicly ever since. He studied at the Rhode Island Conservatory of
Music and sang with the famous Al Kay Orchestra until Al Kay passed away. Mr.
Jordan sang gospel with a group called Jubilee Band in the mid 1980's and has
looked forward to sharing his work with others through production of an album
ever since.
Barbara Chadwick
The Company signed a producers contract with artist Barbara Chadwick in
September 1999 to record a single CD and cassette at New River Recording Studios
in Ft. Lauderdale, Florida which is to be Ms. Chadwick's first album. P&G is to
bear all costs in the production of the album, while Ms. Chadwick will retain
all rights to the work produced. P&G shall market the album through direct
response television advertisement as well as over the Internet. P&G shall pay
Ms. Chadwick a $0.12 royalty on all sales of the album through direct response
television.
The Company will also serve as Ms. Chadwick's agent and will endeavor to
introduce Ms. Chadwick to a major record company. In the event such a contract
is signed, the Company is entitled to 35% of the value of such contract.
Ms. Chadwick sings both blues and contemporary jazz and performs in clubs
and hotels along the east coast of the United States concentrating primarily in
New Jersey and Florida.
Beverly Fortin
The Company signed a producers contract with artist Beverly Fortin in
September 1999 to record a single CD and cassette at New River Recording Studios
in Ft. Lauderdale, Florida which is to be Ms. Fortin's first album. P&G is to
bear all costs in the production of the album, while Ms. Fortin will retain all
rights to the work produced. P&G shall market the album through direct response
television advertisement as well as over the Internet. P&G shall pay Ms. Fortin
a $0.12 royalty on all sales of the album through direct response television.
The Company will also serve as Ms. Fortin's agent and will endeavor to
introduce Ms. Fortin to a major record company. In the event such a contract is
signed, the Company is entitled to 35% of the value of such contract.
<PAGE>
Ms. Fortin sings pop music occasionally at local events and has served as a
backup singer to nationally known artists such as Brenda K. Star, Mariah Carey,
Debbie Jacobs, Pamela Stanley, Jessica Williams, Vickie Sue Robinson and Gloria
Estefan and the Miami Sound Machine. She owns a restaurant in Pompano Beach,
Florida and several other local nightclubs.
Television
P&G also plans to explore the possibility of a talk show based in Florida.
In 1980, the three (3) commercial networks' combined broadcast was less than 100
hours of programming a week. Today there are six (6) commercial broadcast
networks and over 150 cable channels plus satellite needing to fill up 24 hours
of every day with programs. This translates to over 20,000 hours of time which
programmers must fill.
A half-hour prime time series can cost over $1 million per episode to
produce. These shows are too expensive for many small stations, and in any
event, can only run at peak hours. News magazines and talk shows are therefore
high on the networks' wish lists. These shows are less expensive to produce and
appeal to a large segment of the viewership. Variety shows containing new talent
are rarely produced and aired although they have remained comparatively
inexpensive to produce. Television stations often shy away from the task of
recruiting new talent for fear of over-diversifying from a television to a
television and music company.
The Company feels that it could either contract with a television station
to provide talent for a television station sponsored variety show, or could fill
an entire time slot by producing a variety show of its own. By introducing its
talent in this medium, the Company hopes to boost record sales.
Films and Videos
The Company may also expand into the area of the production of movies made
strictly for the home video, pay-per-view and cable television and satellite
audiences.
Motion Picture Licensing and Distribution
The Company may also expand its business to include licensing, sales and
distribution of certain rights to independently produced feature films in a wide
variety of genres. The Company's goal would be to become increasingly active in
acquiring both domestic and foreign distribution rights, booking motion pictures
with theatrical exhibitors, arranging for the manufacture of release prints from
the film negative and promoting the motion pictures with advertising and
publicity campaigns.
The Company has already begun to act as a foreign sales agent, licensing
distribution rights in markets outside the United States to independently
produced films which are fully financed and owned by others, in exchange for a
sales agency fee. In addition to the production of motion pictures and
distribution in the United States, substantial revenues are possible from
international exploitation of the Company's motion pictures. International
revenues of motion picture distributors from filmed entertainment grew from $4.7
billion in 1989 to $8.7 billion in 1996. This growth has been attributed to
worldwide acceptance of and the demand for motion pictures produced in the US,
the privatization of foreign television industries, growth in the number of
foreign households with video cassette players and growth in the number of
foreign television screens.
<PAGE>
The Company actively participates at all three (3) major film markets (the
American Film Market, the Cannes Film Festival and MIFED), as well as the major
television (NATPE, MIP, MIPCOM) and video (VSDA) markets. The Company may also,
from time to time, engage independent representatives to assist the Company in
acquiring and/or licensing motion picture rights.
With respect to international territories, the Company licenses
distribution rights in various mediums (such as theatrical, video, pay
television, free television, satellite and other rights) to foreign
sub-distributors on either an individual rights basis or grouped in various
combinations of rights (which sometimes includes rights in all media). These
rights are licensed by the Company to numerous sub-distributors in international
territories or regions either on a picture-by-picture basis or, in certain
circumstances, with respect to a number of motion pictures pursuant to output
arrangements. Currently, the most appealing international territories for the
Company are Australia, the Benelux countries, Brazil, Canada, France, Germany,
Italy, Japan, Scandinavia, Spain and the United Kingdom.
The terms of the Company's license agreements with foreign sub-distributors
vary depending upon the territory and media involved and whether the agreement
relates to a single motion picture or multiple motion pictures. Most of the
Company's license agreements will provide that the Company will receive a
minimum guarantee from the foreign sub-distributor with all or a majority of
such minimum guarantee paid prior to, or upon delivery of the film to the
distributor for release in the particular territory. The remainder of any unpaid
minimum guarantee is generally payable at specified intervals after delivery of
the film to the sub-distributor. The minimum guarantee is recouped by the
sub-distributor out of the revenues generated from exploitation of the picture
in such territory. The foreign sub-distributor retains a negotiated distribution
fee (generally measured as a percentage of the gross revenues generated from its
distribution of the motion picture), recoups its distribution expenses and the
minimum guarantee and ultimately (after recoupment by the distribution expenses)
remits to the Company the remainder of any receipts in excess of the
distributor's ongoing distribution fee.
The Company must rely on the foreign sub-distributor's ability to
successfully exploit the film in order to receive any proceeds in excess of the
minimum guarantee. In certain situations, the Company does not receive a minimum
guarantee from the foreign sub-distributor and instead negotiates terms which
usually result, in effect, in an allocation of gross revenues between the sub-
distributor and the Company. Typically the terms of such an arrangement provide
for the sub- distributor to retain an ongoing distribution fee (calculated as a
percentage of gross receipts of the sub-distributor in the territory), recoup
its expenses and pay remaining receipts in excess of the ongoing distribution
fee to the Company. Alternatively, such as often with respect to video rights,
the terms may provide for a royalty to be paid to the Company calculated as a
percentage of the gross receipts of the sub-distributor from exploitation of the
video rights (without deduction for the sub-distributor's distribution
expenses).
Groups of motion pictures are often packaged and licensed as a group for
exhibition on video and television over a period that extends beyond five years
from the initial domestic theatrical release of a particular film. Motion
<PAGE>
pictures are also licensed and "packaged" by producers and distributors for
television broadcast in international markets by government owned or privately
owned television studios and networks. Pay television is less developed outside
the U.S., but is experiencing significant international growth. The prominent
foreign pay television services include channel Premiere, STAR TV, British Sky
Broadcasting and the international operations of several U.S. cable services
including HBO, the Disney Channel and Turner Broadcasting.
Business Strategy
The Company's business strategy, which is dependent upon its continuing to
have sufficient cash flow from operations and/or obtaining sufficient additional
financing with which to enhance the commercialization of existing and future
products, is to develop the talents of new artists and to either reproduce an
existing work or to record original material for global distribution. The
Company's revenues to date are minimal and are based upon the licensing
arrangements it has entered into as a foreign sales agent. The Company's
revenues are dependent on the volume of sales from its products and services it
provides.
Revenues from sales and services are recognized in the period in which
sales are made or services are provided. The Company's gross profit margin will
be determined in part by its ability to estimate and control direct costs of
manufacturing and production costs and its ability to incorporate such costs in
the price charged to customers and clients.
The Company's objective is to become a dominant provider of entertainment
products, initially in the music industry and eventually including music, video,
television products as well as to become an agent for others. To achieve this
objective, and assuming that sufficient funds are available, the Company intends
to: (i) develop international distribution channels and co-marketing alliances
for the Company's products and services; (ii) continue to sign new artists and
to develop their skills and ready them for production; (iii) to explore new
possibilities in television and the internet; and (iv) to begin retail sales of
its products through Direct Sales efforts.
Management believes that the Company is poised to lead in the ever
developing entertainment industry. Management expects, in the event the Company
continues to achieve product acceptance, to increase its market penetration
through acquisition of additional artists, joint venture opportunities with
established market leaders and expansion of its personnel. However, such
expansion presents certain challenges and risks and there can be no assurance
that the Company, even if it were successful in acquiring other bases of
business development, would be successful in profitably penetrating these
potential markets.
Marketing and Distribution
Marketing
The following discussion of the entertainment industry, as it relates to
the Company's objectives, is of course pertinent only if the Company is
successful in maintaining sufficient cash flow from operations and/or obtaining
sufficient debt and/or equity financing to commercialize its existing products,
to add additional key personnel where needed, and to supplement new product
development. In addition, the Company must be able to generate significant
<PAGE>
profits from operations and/or additional financing to continue expanding the
business and/or to fund the anticipated growth, assuming the Company's proposed
expanded business is successful. There can be no assurance such financing can be
obtained or that the Company's proposed expanded business will be successful.
According to the National Association of Recording Merchandisers ("NARM"),
the music industry is a $8.79 Billion a year enterprise, with 32.6% of sales
being made through the use of credit cards. The Company was recently approved to
accept major credit cards and will implement their use on direct sales efforts
immediately.
Although according to the Recording Industry Association of America
("RIAA") the Internet accounted for only 0.3% of the total music sales in the
U.S. in 1997, the RIAA sees the Internet as, "an opportunity to expose music to
a wider audience than ever before." The Internet is an inexpensive medium which
also allows a company with less resources such as independents and start-ups to
compete for sales with larger more established companies.
In the wake of a dramatic increase in Internet sales, the record club
industry has reported steady declines between the years of 1994 and 1997. While
record club purchases accounted for a total of 15.1% of total music sales, in
1997 record club sales accounted for only 11.6% of total music sales. Mail order
sales, which seem to have paralleled record club sales, have reached a seven (7)
year market share low of 2.7% (RIAA).
A significant factor in the above distribution forum changes has been the
introduction of new mediums for audio listening. In 1997, full-length CD's
dominated the market with a 70.2% market share. A far second was full-length
cassettes with only an 18.2% share. Vinyl sales however, rose from 0.3% in 1993
(the date of CD introduction) to 0.7% in 1997. This rise was mostly attributed
to collectors, disk jockeys and rap music (RIAA).
According to the RIAA, unit shipments of all formats to direct and special
markets grew 11% from 124.7 million in mid-'98 to 138.4 million in mid-'99. This
is especially of interest to the Company, who plans to focus in these areas. The
dollar value of shipments to direct and special markets also grew 4.7% from
$732.5 million in mid-'98 to $767.2 million in mid-'99.
Consumer profiles compiled by NARM are also of interest to P&G, as much of
the Company's music will appeal to an older audience. 1997 statistics show that
persons 45 years of age and older are the second largest purchasers of music
products, second only to ages 15-19.
Distribution
The Company's initial plan of distribution is to market and sell the
product through direct sales efforts. Primarily the Company will focus on
infomercials to sell its products. Print media, direct mail and short form 120
and 60-second commercials may follow the infomercial.
In addition to the infomercial, the Company may eventually institute a
direct mail and sales campaign for the Company's products which the Company
believes will generate sales from consumers throughout the United States. In
addition, the Company has an ongoing program to participate in trade shows and
festivals, promotional events and retail mall shows. These events have
historically generated sales and significant exposure in the industry.
<PAGE>
The growth and improvement of direct response marketing and sales via
infomercials, home shopping networks and commercials has had a positive impact
on the retail sales industry and specifically on the music industry. Companies
such as BMG and Columbia House have been especially successful. Additionally,
retailers are increasingly utilizing alternative forms of retailing; such as,
television shopping and infomercials and merchandising albums with other
entertainment items.
The Company intends to save considerable expense by acting as its own
fulfillment center. Thus, all telephone sales, packaging and shipping will be
handled exclusively by the Company. The Company expects that it will have
sufficient resources and capital necessary to expand to meet these obligations.
A shortage of capital could have a material adverse effect on the Company's
ability to handle its fulfillment obligations in-house.
The Company expects to sell its products in retail stores when profit
margins show signs of weakening through direct sales efforts. The retail market
is expected to support the product for several years thereafter.
The Company's intends to eventually joint venture with major recording
labels which have the support structure necessary to record and publish an album
on a much larger scale. By joint-venturing for manufacturing, distribution and
finance of albums, P&G hopes to be able to launch new artists quickly and
efficiently, dedicating adequate funds to promote the artist and the work to
achieve maximum exposure.
Distribution on the Internet
The Company is also already selling its products over the Internet. It
advertises albums for sale directly through the Company website. Customers are
able to browse the site, listen to sample wav. files and soon will be able to
purchase albums directly from the Company over the Internet in a secure
environment. The Company intends to pay for advertising space on frequently
visited sites such as browsers upon receipt of sufficient capital from either
revenues or debt or equity financing.
Also, the on-line delivery of music and video is inevitable and the death
of the modern music and video stores is imminent. P&G plans to establish
websites to promote and distribute its materials, as well as the materials of
others. Online sales are considerably less expensive to promote.
Status of Publicly Announced Products and Services
The singles "If Only" and "Touch Me" were originally to be recorded with
Michela as the lead vocalist. The Company released information to the public in
various mediums publicizing the expected release. The singles were test-marketed
in Nashville in 1998 and tested extremely well. The "I wanna buy" margin was
approximately 95%. The Company has since elected not to use Michela as the lead
vocalist for these two (2) singles and is currently searching for a suitable
singer to replace Michela.
Additionally, the Betty Dickson albums A Woman For All Seasons and Stolen
Goods are currently available through the Company's website located at
http://www.platinum-gold.com.
<PAGE>
No other P&G products or services have been publicly announced and are
either in the production or planning phase.
Competition
The Company faces competition from large, well-established companies with
considerably greater financial, marketing, sales and technical resources than
those available to the Company. Additionally, many of the Company's present and
potential competitors have research and development capabilities that may allow
such competitors to develop new and improved products which may compete with the
Company's products. The Company's products could be rendered obsolete or made
uneconomical by the development of new products, technological advances
affecting the cost of production, or marketing or pricing actions by one or more
of the Company's competitors. The Company's business, financial condition or
results of operations could be materially adversely affected by one or more of
such developments. There can be no assurance that the Company will be able to
compete successfully against current or future competitors or that competition
will not have an material adverse effect on the Company's business, financial
condition or results of operations.
Competition - Music Recording and Publishing
Competition is intense within the music industry, in general, and also in
the agency or booking aspect of the industry in which the Company may conduct
its operations in the future. The Company's opportunity to obtain clients with
the potential for achieving popular and commercial success may be limited by its
financial resources and other assets. It is anticipated that the music industry
may be subject to changes in the general state of the economy, shifts in the
demographic structure, changes in the buying habits of the public, the
availability of alternative forms of entertainment and the increased cost of
doing business. Further, there may be significant technological advances in the
future and the Company may not have adequate creative management and resources
to enable it to take advantage of such advances. Many of the companies and other
organizations with which the Company will be in competition have far greater
financial resources, greater experience and larger staffs than the Company.
Additionally, many of such organizations have proven operating histories, which
the Company lacks. The Company expects to face strong competition from both such
well-established companies and independent companies like itself.
Competition - Films
In the event the Company enters the motion picture industry, the Company's
movies will compete with traditional feature films and television programming
produced by major movie studios, including Disney, Warner Bros. Inc., Twentieth
Century Fox Film Corporation, Paramount Pictures, Sony Pictures, Inc.,
Lucasfilm, Universal City Studios, Inc. and MGM/UA, as well as numerous other
independent motion picture and television production companies. The Company's
broadcast and home video products will compete with the films of these movie
studios for audience acceptance and exhibition over broadcast/cable and home
video channels. In addition, the Company will compete with movie studios for the
acquisition of literary properties, production financing, the services of
performing artists, and the services of other creative and technical personnel.
Most of the movie studios with which the Company will compete have significantly
greater name recognition and significantly greater financial, technical,
creative, marketing, and other resources than does the Company. Due to their
substantially greater resources, these movie studios likely will be able to
enter into more favorable distribution arrangements and to promote their films
and television programming more successfully than the Company.
<PAGE>
Competition - Videos
In the event the Company enters into the video production industry, the
Company's videos will compete with the feature films produced by the major movie
studios listed above as well as numerous independent production companies, some
of whom produce movies exclusively for release on videocassette. Most of the
movie studios with which the Company will compete have significantly greater
name recognition and significantly greater financial, technical, creative,
marketing, and other resources than does the Company. Due to their substantially
greater resources, these movie studios likely will be able to enter into more
favorable distribution arrangements and to promote their films and television
programming more successfully than the Company.
Competition - Distribution on the Internet
The market for online commerce is extremely competitive, and the Company
believes competition, particularly in connection with online music sales, will
continue to grow and intensify. The Company's most visible competitors may
include CustomDisc.com, CDuctive, and amplified.com. Although the Company's
primary focus will be on sales of Company artists, rather than the music of
other artists, P&G may ultimately compete with existing online websites that
provide sales of pre-recorded music on the Internet. Online competitors include
CDnow, Inc., Amazon.com, Inc., barnesandnoble.com inc., Columbia House and BMG
Music Service. CDnow purchased SuperSonic Boom, a custom compilation provider,
in June 1998.
Sources and Availability of Raw Materials
The materials needed to produce movies or television and to record music is
widely available from numerous third parties for rent or for sale. The final
product is then manufactured and mass produced by a third party independent
contractor. The raw materials to produce CD's, audio cassettes, digital video
disks, videocassettes, laser disks and other medium are widely available from
numerous sources. No shortage of materials is expected in the foreseeable
future.
Dependence on one or few customers
The Company will rely heavily on its customers' preferences to best
determine the products which will be produced. The commercial success of the
Company's products will depend on its ability to predict the type of content
that will appeal to a broad audience. Although the Company plans to test market
their products prior to their release, there can be no assurance that the
Company will be able to predict the appeal of its products before their
production. Considerable expense is expended on production costs before a
product can be test marketed. Therefore, although a product which tests poor can
be scrapped before additional expense is incurred associated with release
including marketing and distribution, the Company may have to bear the expense
of production of some products, which may never be released. This may have a
material adverse effect on the Company.
Research and Development
The Company believes that research and development is an important factor
in its future growth. The entertainment industry is closely linked to
technological advances, which produce new ways of producing product and a new
<PAGE>
medium for its use by the public. Recent developments include: on-line sales,
digital downloading of music and video, digital video disks and others.
Therefore, the Company must continually invest in the latest technology to
appeal to the public and to effectively compete with other companies in the
industry. No assurance can be made that the Company will have sufficient funds
to purchase technological advances as they become available. Additionally, due
to the rapid advance rate at which technology advances, the Company's equipment
and inventory may be outdated quickly, preventing or impeding the Company from
realizing its full potential profits.
Patents, Copyrights and Trademarks
The Company intends to protect its original intellectual property with
patents, copyrights and/or trademarks as appropriate.
To date, the Company has registered two (2) copyrights. On November 7,
1997, the Company filed on Form SR (for sound recordings) copyright applications
for the works titled "If Only" and "Touch Me". The effective date of such
registrations is November 7, 1997.
Governmental Regulation
Currently there is no government regulation of the Company's business nor
of the Company's products.
State and Local Licensing Requirements
Currently there are no state or local licensing requirements which apply to
the Company's business or to its products
Effect of Probable Governmental Regulation on the Business
Currently there is no government regulation of the Company's business nor
of the Company's products. However, new laws are emerging which regulate
commerce over the internet and the way data and information may be transmitted
over the Internet. Should the Company engage in activities involving the
Internet in the future, it may be subject to these laws and/or regulations.
As the Company's products and services are available over the Internet in
multiple states and foreign countries, these jurisdictions may claim that the
Company is required to qualify to do business as a foreign corporation in each
such state and foreign country. New legislation or the application of laws and
regulations from jurisdictions in this area could have a detrimental effect upon
the Company's business.
A governmental body could impose sales and other taxes on the provision of
the Company's products and services, which could increase the costs of doing
business. A number of state and local government officials have asserted the
right or indicated a willingness to impose taxes on Internet-related services
and commerce, including sales, use and access taxes; however, no such laws have
become effective to date. The Company cannot accurately predict whether the
<PAGE>
imposition of any such taxes would materially increase its costs of doing
business or limit the services which it provides, since it may be possible to
pass on some of these costs to the consumer and continue to remain competitive.
If, as the law in this area develops, the Company becomes liable for
information carried on, stored on, or disseminated through its website, it may
be necessary for the Company to take steps to reduce its exposure to this type
of liability through alterations in its equipment, insurance or other methods.
This may require the Company to spend significant amounts of money for new
equipment or premiums and may also require it to discontinue offering certain of
its products or services.
Due to the increasing popularity and use of the Internet, it is possible
that additional laws and regulations may be adopted with respect to the
Internet, covering issues such as content, privacy, access to adult content by
minors, pricing, bulk e-mail (spam), encryption standards, consumer protection,
electronic commerce, taxation, copyright infringement and other intellectual
property issues. P&G cannot predict the impact, if any, that future regulatory
changes or developments may have on the Company's business, financial condition,
or results of operation.
Cost of Research and Development
For fiscal year 1999, the Company expended no measurable amount of money on
research and development efforts. At the current time, none of the costs
associates with research and development are bourne directly by the customer;
however there is no guarantee that such costs will not be bourne by customers in
the future and, at the current time, the Company does not know the extent to
which such costs will be bourne by the customer, if at all.
Cost and Effects of Compliance with Environmental Laws
The Company's business is not subject to regulation under the state and
Federal laws regarding environmental protection and hazardous substances
control. The Company is unaware of any bills currently pending in Congress which
could change the application of such laws so that they would affect the Company.
Employees and Consultants
At March 30, 2000, the Company employed two (2) persons. Neither of these
employees are represented by a labor union for purposes of collective
bargaining. The Company considers its relations with its employees to be
excellent. The Company plans to employ additional personnel as needed upon
product rollout to accommodate fulfillment needs.
In October 1998, prior to its acquisition by the Company, PGRP entered into
an agreement with Randy Bernsen to be a Director of PGRP. The term was until the
next annual meeting of the shareholders and directors. As compensation, Randy
Bernsen was promised 10,000 shares of the restricted common stock of the Company
upon the share exchange to be conducted in November 1998. The shares were issued
in January 1999 pursuant to Section 4(2) of the Act, Rule 506 and Section
517.061(11) of the Florida code. See Part III, Item 10. "Executive Compensation
- - Employee Contracts and Agreements"; Part III, Item 11. "Security Ownership of
Certain Beneficial Owners and Management"; and Part III, Item 12. "Certain
Relationships and Related Transactions".
<PAGE>
In November 1998, prior to its acquisition by the Company, PGRP entered
into an agreement with Glenda Grainger to be a Director of PGRP. As
compensation, Glenda Grainger was promised 10,000 shares of the restricted
common stock of the Company upon the share exchange to be conducted in November
1998. The shares were issued in January 1999 pursuant to Section 4(2) of the
Act, Rule 506 and Section 517.061(11) of the Florida code. See Part III, Item
10. "Executive Compensation - Employee Contracts and Agreements"; Part III, Item
11. "Security Ownership of Certain Beneficial Owners and Management"; and Part
III, Item 12. "Certain Relationships and Related Transactions".
In November 1998, the Company entered into a share exchange agreement with
PGRP, and its shareholders which had been formed in June 1997. The exchange was
made whereby the Company issued 10,000,000 shares of its restricted common stock
to the shareholders of PGRP for all of the issued and outstanding stock of PGRP.
As part of the exchange, Ms. Neal, Ms. Peters and Ms. Cavell received 6,000,000,
2,000,000 and 2,000,000 shares of the Company's restricted common stock
respectively. This offering was conducted pursuant to Section 4(2) of the Act
and Rule 506 and Section 517.061(11) of the Florida Code. See Part I, Item 6.
"Management's Discussion and Analysis or Plan of Operation - Stockholders'
Equity"; Part III, Item 10. "Executive Compensation - Employee Contracts and
Agreements"; Part III, Item 11. "Security Ownership of Certain Beneficial Owners
and Management"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
In January 1999, the Company issued 10,000 shares of its restricted common
stock to Margaret Ann Ronayne in connection with her agreement to serve on the
Company's Board of Directors and a Representation Agreement entered into in
December 1998. The shares were issued pursuant to Section 4(2) of the Act, Rule
506 and Section 517.061(11) of the Florida code. See Part III, Item 10.
"Executive Compensation - Employee Contracts and Agreements"; Part III, Item 11.
"Security Ownership of Certain Beneficial Owners and Management"; and Part III,
Item 12. "Certain Relationships and Related Transactions".
In September 1999, the Company executed a Promissory Note in favor of Carol
Neal, the Company's past Chairman, President and Treasurer in the amount of
$24,600. The Note was in exchange for monies lent by Ms. Neal to the Company for
working capital. The Note has since been repaid by the Company. See Part III,
Item 10. "Executive Compensation - Employee Contracts and Agreements"; Part III,
Item 11. "Security Ownership of Certain Beneficial Owners and Management"; and
Part III, Item 12. "Certain Relationships and Related Transactions".
In November 1999, the Company entered into a consulting contract with Joyce
Research Group, Inc. to provide financial public relations services to the
Company. As payment for these services, the Company committed to pay $225,000 or
to issue shares of its "free-trading" Common Stock within a six (6) month
period. An initial payment of $50,000 was made in December 1999. See Part III,
Item 12. "Certain Relationships and Related Transactions".
In November and December 1999, the Company entered into consulting
contracts with three (3) individuals to provide financial, public and investor
relations services to the Company. As payment for such services, the Company
<PAGE>
issued 800,000 shares of its Common Stock and paid $20,000 For such offering,
the Company relied upon Section 3(b) of the Act, Rule 701, NSMIA, Section
517.061(11) of the Florida Code and Section 10-5-9(13) of the Georgia Code. See
Part III, Item 12. "Certain Relationships and Related Transactions".
Item 2. Description of Property
The Company maintains its executive offices at 12724 N.W. 11th Court,
Sunrise, Florida 33323, which is the residence of both Valerie Peters and Louise
Cavell. Approximately 500 square feet of space is devoted entirely to P&G as an
office. Its telephone number is (800) 525-8495 and its facsimile number is (954)
845-0656. The Company plans to lease office space in either Broward or Palm
Beach County, Florida upon receipt of sufficient capital resulting from revenues
or debt or equity financing. It is planned that such office space shall serve as
the Company headquarters and also as a fulfillment center for the Company's
products.
The Company owns no real property and its personal property consists of
furniture, fixtures and equipment, with an original cost of $2,177 on July 31,
1999.
Item 3. Legal Proceedings
No legal proceedings have been initiated either by or against the Company
to date.
Item 4. Submission of Matters to a Vote of Security Holders
No matter was submitted to a vote of the Company's shareholders, through
the solicitation of proxies or otherwise from the Company's inception to the
close of the 1999 fiscal year ended December 31, 1999, covered by this report.
Item 5. Market for Common Equity and Related Stockholder Matters.
Shares of the Company's Common Stock have previously been registered with
the Securities and Exchange Commission (the "Commission"). The Company intends
to and has made application to the NASD for the Company's shares to be quoted on
the OTC Bulletin Board. The Company's application to the NASD consists of
current corporate information, financial statements and other documents as
required by Rule 15c2-11 of the Exchange Act. Inclusion on the OTC Bulletin
Board, when approved, permits price quotation for the Company's shares to be
published by such service.
The Company is not aware of any existing trading market for its Common
Stock. The Company's Common Stock has never traded in a public market. There are
no plans, proposals, arrangements or understandings with any person(s) with
regard to the development of a trading market in any of the Company's
securities.
If and when the Company's Common Stock is traded in the over-the-counter
market, most likely the shares will be subject to the provisions of Section
15(g) and Rule 15g-9 of the Securities Exchange Act of 1934, as amended (the
Exchange Act"), commonly referred to as the "penny stock" rule. Section 15(g)
sets forth certain requirements for transactions in penny stocks and Rule
15g9(d)(1) incorporates the definition of penny stock as that used in Rule
3a51-1 of the Exchange Act.
<PAGE>
The Commission generally defines penny stock to be any equity security that
has a market price less than $5.00 per share, subject to certain exceptions.
Rule 3a51-1 provides that any equity security is considered to be a penny stock
unless that security is: registered and traded on a national securities exchange
meeting specified criteria set by the Commission; authorized for quotation on
The NASDAQ Stock Market; issued by a registered investment company; excluded
from the definition on the basis of price (at least $5.00 per share) or the
registrant's net tangible assets; or exempted from the definition by the
Commission. If the Company's shares are deemed to be a penny stock, trading in
the shares will be subject to additional sales practice requirements on broker-
dealers who sell penny stocks to persons other than established customers and
accredited investors, generally persons with assets in excess of $1,000,000 or
annual income exceeding $200,000, or $300,000 together with their spouse.
For transactions covered by these rules, broker-dealers must make a special
suitability determination for the purchase of such securities and must have
received the purchaser's written consent to the transaction prior to the
purchase. Additionally, for any transaction involving a penny stock, unless
exempt, the rules require the delivery, prior to the first transaction, of a
risk disclosure document relating to the penny stock market. A broker-dealer
also must disclose the commissions payable to both the broker-dealer and the
registered representative, and current quotations for the securities. Finally,
the monthly statements must be sent disclosing recent price information for the
penny stocks held in the account and information on the limited market in penny
stocks. Consequently, these rules may restrict the ability of broker dealers to
trade and/or maintain a market in the Company's Common Stock and may affect the
ability of shareholders to sell their shares.
As of March 30, 2000, there were 62 holders of record of the Company's
Common Stock.
As of March 30, 2000, the Company has 12,431,000 shares of its Common Stock
issued and outstanding, 10,830,000 of which are restricted Rule 144 shares and
1,601,000 of which are free- trading. Of the Rule 144 shares, 10,030,000 shares
have been held by affiliates of the Company for more than one (1) year.
Dividend Policy
The Company has never paid or declared any dividends on its Common Stock
and does not anticipate paying cash dividends in the foreseeable future.
Item 6. Management's Discussion and Analysis or Plan of Operation
Initially the Company was engaged in the medical supply business. In
November 1998, at the time it acquired PGRP as a wholly-owned subsidiary, its
purpose changed to P&G's initial purpose of discovering, developing, recording
and marketing new talent in the entertainment industry. PGRP's founding
philosophy arose from the diversified experience of its management in the music,
video, film and related industries.
<PAGE>
The Company was in the development stage until November 1998 when the Share
Exchange took place between PGRP and the Company and is still emerging from that
stage. The Company has only recently begun selling the Betty Dickson albums and
has not yet completed the "If Only" and "Touch Me" singles. From the date of the
Share Exchange in November 1998 through December 31, 1999, the Company generated
no revenues. Since inception (February 17, 1997 through December 31, 1999, the
Company has generated cumulative losses of approximately $234,959. Due to the
Company's limited operating history and limited resources, among other factors,
there can be no assurance that profitability or significant revenues on a
quarterly or annual basis will occur in the future.
The Company is currently preparing to launch its first two (2) singles and
expects to introduce other products by Ms. Dickson and others by the end of 2000
and expects to continue to invest significant resources in several new products
and enhancements through 2000.
Since recording of the first two (2) singles and upon entering into
contracts with several artists, the Company has begun to make preparations for a
period of growth, which may require it to significantly increase the scale of
its operations. This increase will include the hiring of additional personnel in
all functional areas and will result in significantly higher operating expenses.
The increase in operating expenses is expected to be matched by a concurrent
increase in revenues. However, the Company's net loss may continue even if
revenues increase and operating expenses may still continue to increase.
Expansion of the Company's operations may cause a significant strain on the
Company's management, financial and other resources. The Company's ability to
manage recent and any possible future growth, should it occur, will depend upon
a significant expansion of its accounting and other internal management systems
and the implementation and subsequent improvement of a variety of systems,
procedures and controls. There can be no assurance that significant problems in
these areas will not occur. Any failure to expand these areas and implement and
improve such systems, procedures and controls in an efficient manner at a pace
consistent with the Company's business could have a material adverse effect on
the Company's business, financial condition and results of operations. As a
result of such expected expansion and the anticipated increase in its operating
expenses, as well as the difficulty in forecasting revenue levels, the Company
expects to continue to experience significant fluctuations in its revenues,
costs and gross margins, and therefore its results of operations.
Results of Operations - Full Fiscal Years - December 31, 1999 and December 31,
1998
Revenues
Revenues for the twelve month period ended December 31, 1999 was $0 and for
the twelve month period ended December 31, 1998 was $0.
Operating Expenses
Operating Expenses for the twelve months of calendar year 1999 were
$216,909 versus $18,050 from inception (February 19, 1997) to December 31, 1998.
Net loss was $216,909 and $18,050 respectively.
<PAGE>
During 1999, the officers of the Company incurred expenses on behalf of the
Company, for which they had yet to receive reimbursement as of December 31,
1999, which expenses totaled $20,589 and for which the Company accounted for
such unpaid expenses as shareholder loans on the Company's balance sheet.
Assets and Liabilities
Assets were $134,996 as of December 31, 1999, and $38,375 as of December
31, 1998. As of December 31, 1998, assets consisted primarily of deferred
production costs and organizational costs with a net book value of $34,683. As
of December 31, 1999, assets consisted primarily of cash. Liabilities were
$352,346 and $39,670 as of December 31, 1999 and December 31, 1998 respectively.
As of December 31, 1999, liabilities consisted primarily of accounts and notes
payable.
During the year ended December 31, 1999, the Company owed its officers
$20,589 for expenses advanced on behalf of the Company.
Stockholders' Equity
Stockholders' equity was ($271,350) as of December 31, 1999 and ($1,295) as
of December 31, 1998. The Company had 12,431,000 and 11,600,000 shares of common
stock issued and outstanding at December 31, 1999 and 1998, respectively.
In November 1998, the Company entered into a share exchange agreement with
PGRP, and its shareholders which had been formed in June 1997. The exchange was
made whereby the Company issued 10,000,000 shares of its restricted common stock
to the shareholders of PGRP for all of the issued and outstanding stock of PGRP.
As part of the exchange, Ms. Neal, Ms. Peters and Ms. Cavell received 6,000,000,
2,000,000 and 2,000,000 shares of the Company's restricted common stock
respectively. This offering was conducted pursuant to Section 4(2) of the Act
and Rule 506 and Section 517.061(11) of the Florida Code. See Part III, Item 10.
"Executive Compensation - Employee Contracts and Agreements"; Part III, Item 11.
"Security Ownership of Certain Beneficial Owners and Management"; and Part III,
Item 12. "Certain Relationships and Related Transactions".
Financial Condition, Liquidity and Capital Resources
At December 31,1999 the Company had cash of $98,329 as compared to $1,553
at December 31, 1998.
In July 1999, the Company initiated an offering of its Convertible Notes.
The Notes have a term of one (1) year, bear interest at a rate of nine percent
(9%) and are automatically convertible to shares of the Company's Common Stock
in one (1) year (if they are not converted earlier) at a price of $1.00 per
share plus interest, which interest is also payable in shares of the Company's
Common Stock. To date, one (1) note has been sold in the principal amount of
$200,000 in December 1999. The offering is ongoing. For such offering, the
Company relied upon Section 3(b) of the Act, Rule 504 and Section 517.061(11) of
the Florida Code. See Part III, Item 12. "Certain Relationships and Related
Transactions".
<PAGE>
The Company may raise additional capital through private and/or public
sales of securities in the future but has no definite commitments at this time.
Year 2000 Compliance
The Year 2000 Issue is the result of potential problems with computer
systems or any equipment with computer chips that use dates where the date has
been stored as just two digits (e.g. 98 for 1998). On January 1, 2000, any clock
or date recording mechanism including date sensitive software which uses only
two digits to represent the year, may recognize the date using 00 as the year
1900 rather than the year 2000. This could result in a system failure or
miscalculations causing disruption of operations, including among other things,
a temporary inability to process transactions, send invoices, or engage in
similar activities.
The Company determined that the Year 2000 impact is not material to P&G and
that it will not impact its business, operations or financial condition since
all of the internal software utilized by the Company has the capability of being
upgraded to support Year 2000 versions.
The Company believes that it has disclosed all required information
relative to Year 2000 issues relating to its business and operations. However,
there can be no assurance that the systems of other companies on which the
Company's systems rely also will be timely converted or that any such failure to
convert by another company would not have an adverse affect on the Company's
systems.
Forward-Looking Statements
This Form 10-KSB includes "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements, other than
statements of historical facts, included or incorporated by reference in this
Form 10-KSB which address activities, events or developments which the Company
expects or anticipates will or may occur in the future, including such things as
future capital expenditures (including the amount and nature thereof), demand
for the Company's products and services, expansion and growth of the Company's
business and operations, and other such matters are forward-looking statements.
These statements are based on certain assumptions and analyses made by the
Company in light of its experience and its perception of historical trends,
current conditions and expected future developments as well as other factors it
believes are appropriate in the circumstances. However, whether actual results
or developments will conform with the Company's expectations and predictions is
subject to a number of risks and uncertainties, general economic market and
business conditions; the business opportunities (or lack thereof) that may be
presented to and pursued by the Company; changes in laws or regulation; and
other factors, most of which are beyond the control of the Company.
Consequently, all of the forward-looking statements made in this Form 10-KSB are
qualified by these cautionary statements and there can be no assurance that the
actual results or developments anticipated by the Company will be realized or,
even if substantially realized, that they will have the expected consequence to
or effects on the Company or its business or operations.
<PAGE>
Item 7. Financial Statements
The Company's financial statements have been examined to the extent
indicated in their reports by Michael Kravatz, C.P.A, independent certified
accountants, and have been prepared in accordance with generally accepted
accounting principles and pursuant to Regulation S-B as promulgated by the
Securities and Exchange Commission and are included herein, on Page F-1 hereof
in response to Part F/S of this Form 10-KSB.
Item 8. Changes In and Disagreements with Accountants on Accounting and
Financial Disclosure.
The Company has used the accounting firm of Michael Kravatz, C.P.A. since
October 1999. Their address is 4747 Hollywood Boulevard, Suite 104, Hollywood,
FL 33021. There has been no change in the Company's independent accountant
during the period commencing with the Company's retention of Michael Kravatz
C.P.A. through the date hereof.
PLATINUM AND GOLD INC.
(a Development Stage Company)
TABLE OF CONTENTS Page
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS F-1
FINANCIAL STATEMENTS:
Consolidated Balance Sheets F-3
Consolidated Statements of Operations F-4
Consolidated Statements of Stockholders' Equity (Deficit) F-5
Consolidated Statements of Cash Flows F-6
Notes to Consolidated Financial Statements F-7
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors and Stockholders
Platinum and Gold, Inc.
I have audited the accompanying consolidated balance sheets of Platinum and
Gold, Inc. and Subsidiary (a Development Stage Company) as of December 3l, l999,
and the related consolidated statements of operations, stockholders' equity
(deficit) and cash flows for the year ended December 3l, l999. These financial
statements are the responsibility of the Company's management. My responsibility
is to express an opinion on these financial statements based on my audit. The
financial statements of Platinum and Gold, Inc. and Subsidiary (a Development
Stage Company) as of December 31, 1998 were audited by other auditors, whose
report dated January 18, 1999 expressed an unqualified opinion on those
statements.
I conducted our 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 from 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 provides a reasonable basis for our opinion.
In my opinion, the financial statements referred to above, present fairly, in
all material respects, the financial position of Platinum and Gold, Inc. and
Subsidiary (a Development Stage Company), as of December 3l, l999 and the
results of its operations and its cash flows for the year ended December 3l,
l999, in conformity with generally accepted accounting principles.
The Company is in the development stage as of December 3l, l999 and to date has
had no significant operations. Recovery of the Company's assets is dependent on
future events, the outcome of which is indeterminable. In addition, successful
completion of the Company's development program and its transition, ultimately,
to attaining profitable operations is dependent upon obtaining adequate
financing to fulfill its development activities and achieving a level of sales
adequate to support the Company's cost structure.
F-1
<PAGE>
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. The Company has suffered losses and has yet to
generate an internal cash flow that raises substantial doubt about its ability
to continue as a going concern. Management's plans in regard to these matters
are described in Note 3. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
/s/ Michael Kravatz
Michael Kravatz, C.P.A.
March 2l, 2000
F-2
<PAGE>
<TABLE>
<CAPTION>
PLATINIUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company)
Consolidated Balance Sheets
ASSETS
December 3l,
1999 1998
<S> <C> <C>
Current assets:
Cash $ 98,329 $ l,533
Total current assets 98,329 1,533
---------------- ----------------
Equipment- net 4,321 l,959
Other assets 32,346 34,883
---------------- ----------------
Total assets $ 134,99 $ 38,375
---------------- ----------------
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities
Accounts payable $ 131,757 $ 24,649
Notes payable 200,000 -
---------------- ----------------
Total current liabilities 331,757 24,649
---------------- ----------------
Stockholder loans 20,589 l5,021
---------------- ----------------
Total liabilities 352,346 39,670
---------------- ----------------
Stockholders' (deficit):
Common stock, $.00l par value; authorized 20,000,000
shares,12,431,000 shares issued and outstanding 12,431 12,355
Additional paid-in capital 5,178 4,400
Deficit accumulated during the development stage (234,959) (18,050)
---------------- ----------------
Total stockholders' (deficit) (217,350) (1,295)
---------------- ----------------
Total liabilities and equity $ 134,996 $ 38,375
---------------- ----------------
</TABLE>
See accompanying notes to the consolidated financial statements
F-3
<PAGE>
<TABLE>
<CAPTION>
PLATINIUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company)
Consolidated Statements of Operations
From From
Inception to Inception to
Year Ended (February 19, 1997) (February 19,1997)
December 31, 1999 December 31, 1998 December 31,1999
----------------- ------------------- -----------------
<S> <C> <C> <C>
Advertising $ 370 $ $ 370
Amortization Expense 3,200 3,200
Automobile Expense 1,322 1,322
Contract Labor 2,508 2,508
Consulting Expense 195,000 1,170 196,170
Interest Expense 437 437
Office Expenses 3,999 3,368 7,367
Professional fees 7,762 8,233 15,995
Stockholder expenses 15 1,935 1,950
Travel and Entertainment 1,352 2,826 4,178
Taxes and Licenses 205 300 505
Depreciation expense 739 218 957
216,909 18,050 234,959
------------------ ------------------- -----------------
Net Loss $(216,909) $ (18,050) $ (234,959)
Net loss
per common share:
Basic
Net Loss per share $ (0.0186) (0.0015) (0.0201)
------------------ ------------------- -----------------
Diluted
Net loss per share $ (0.0183) (0.0015) (0.0198)
------------------ ------------------- -----------------
</TABLE>
See accompanying notes to the consolidated financial statements.
F-4
<PAGE>
<TABLE>
<CAPTION>
PLATINUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company )
Consolidated Statement of Stockholders' Equity (Deficit)
For the Periods Indicated
Deficit
Common stock accumulated
------------------- Additional during the
Numbers Paid-in development Subscriptions
of Shares Amount capital stage Receivable Total
--------------- -------------- -------------- ------------ -------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Balance, February 19,1997
(date of inception) - $ - $ - $ - $ - $ -
Issuance of common stock 11,600,000 12,355 4,400 - (2,800) 13,955
Net loss (106) - (106)
------------ ------------ ------------ ------------ ------------ -----------
Balance, December 31, 1997 11,600,000 12,355 4,400 (106) (2,800) 13,849
Collection of subscription
receivable - - - - 2,800 2,800
Net loss - - - (17,944) - (17,944)
------------ ------------ ------------ ------------ ------------ -----------
Balance, December 31, 1998 11,600,000 $ 12,355 $ 4,400 $ (18,050) $ - $ (1,295)
------------ ------------ ------------ ------------ ------------ -----------
Issuance of Commons Stock 831,000 $ 76 $ 778 $ 854
------------ ------------ ------------ ------------ ------------ -----------
Net Loss (216,909) (216,909)
------------ ------------ ------------ ------------ ------------ -----------
Balance, December 31, 1999 12,431,000 $ 5,178 $ 12,431 (234,959) (217,350)
</TABLE>
See accompanying notes to the consolidated financial statements.
F-5
<PAGE>
<TABLE>
<CAPTION>
PLATINUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company)
Consolidated Statements of Cash Flows
From From
Inception Inception
Year Ended (February 19, 1997) to (February 19, 1997) to
December 31, 1999 December 31, 1998 December 31, 1999
Net loss $ (216,909) $ (18,050) $ (234,959)
------------------ ----------------------- -------------------
<S> <C> <C> <C>
Adjustments to reconcile net loss
to net cash used for operating
activities:
Amortization expense 3,200 0 3,200
Depreciation expense 739 218 957
Increase in other assets (663) (34,883) (35,546)
Increase in accounts payable 107,107 24,649 131,756
------------------ ----------------------- -------------------
Total adjustments 110,383 (10,016) 100,367
------------------ ----------------------- -------------------
Net cash used for operating
activities (106,526) (28,066) (134,592)
------------------ ----------------------- -------------------
Cash flows for investing activities:
Acquisition of equipment (3,101) (2,177) (5,278)
------------------ ----------------------- -------------------
Net cash used for investing
activities (3,101) (2,177) (5,278)
------------------ ----------------------- -------------------
Cash flows from financing activities:
Proceeds from stockholder loans, net
5,568 15,021 20,589
Proceeds from Notes Payable 200,000 0 200,000
Proceeds from issuance of
common stock 855 16,755 17,610
------------------ ----------------------- -------------------
Net cash provided by financing
activities 206,423 31,776 238,199
------------------ ----------------------- -------------------
Net increase (decrease) in cash 96,796 1,533 98,329
Cash at beginning of period 1,533 0 0
------------------ ----------------------- -------------------
Cash at end of period $ 98,329 $ 1,533 $ 98,329
------------------ ----------------------- -------------------
</TABLE>
See accompanying notes to the consolidated financial statements.
F-6
<PAGE>
PLATINUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company)
Notes to Consolidated Financial Statements
(1) BACKGROUND
The Company, ("Platinum and Gold, Inc.") was organized in the state of Nevada on
February 19, 1997, under the name Integra Ventures, Inc. The Company changed its
name to Platinum and Gold, Inc. on November 5, 1998 and on November 11, 1998
completed a merger with its wholly-owned subsidiary, Platinum and Gold Recording
and Publishing Company. The subsidiary, a Florida corporation incorporated on
June18, 1997, was formed to develop and commercialize unique compact disc single
and cassettes.
The Company, through its wholly-owned subsidiary, is in the entertainment
industry involved in the music and film business. The principal activity of the
Company is the acquisition, development, production, marketing, manufacturing
and distribution of recorded music by new recording artists, principally from
other countries.
The Company is currently in a development stage and is in the process of raising
additional capital. There is no assurance that the development of these artists
and their music will be successful and that the Company will achieve a
profitable level of operations.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Principles of consolidation
The consolidated financial statements include all of the accounts of
Platinum and Gold, Inc. and its wholly-owned subsidiary, Platinum and
Gold Recording and Publishing Company. All significant intercompany
transactions and balances have been eliminated in preparing the
consolidated financial statements.
(b) Use of estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
(c) Cash and cash equivalents
Holdings of highly liquid investments with original maturities of three
months or less and investments in money market funds are considered to
be cash equivalents by the Company.
(Continued)
F-7
<PAGE>
PLATINUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company)
Notes to Financial Statements (Continued)
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(d) Property and equipment
Property and equipment are stated at cost, less accumulated
depreciation. Depreciation is computed using straight-line methods over
the depreciable lives of the related assets, which is five years for
office equipment.
(e) Net loss per share
In 1998, the Company adopted SFAS No. 128, ("Earnings Per Share"),
which requires the reporting of both basic and diluted earnings per
share. Basic net loss per share is determined by dividing loss
available to common shareholders by the weighted average number of
common shares outstanding for the period. Diluted loss per share
reflects the potential dilution that could occur if options or other
contracts to issue common stock were exercised or converted into common
stock, as long as the effect of their inclusion is not anti-dilutive.
(f) Income taxes
The Company adopted the method of accounting for income taxes pursuant
to the Statement of Financial Accounting Standards No.109 " Accounting
for Income Taxes" (SFAS 109). SFAS 109 requires an asset and liability
approach for financial accounting and reporting for income taxes. Under
SFAS 109, the effect on deferred taxes of a change in tax rates is
recognized in income in the year that includes the enactment date.
(g) Organization costs
Organization costs are amortized over sixty months using true straight
line method.
(3) GOING CONCERN
The Company is currently a development stage company and its continued existence
is dependent upon the Company's ability to resolve its liquidity problems,
principally by obtaining additional debt financing and/ or equity capital. The
Company has yet to generate an internal cash flow, and until the sales of their
products begin, the Company is totally dependent upon the debt and equity
funding.
As a result of these factors, there exists substantial doubt about the Company's
ability to continue as a going concern. However, management of the Company is
continually negotiating with various outside entities for additional funding. To
date, management has been able to raise the necessary capital to reach this
stage of product development and has been able to fund any capital requirements.
However, there is no assurance that the development of these artists and their
music will be successful and that the Company will achieve a profitable level of
operations.
(Continued)
F-8
<PAGE>
PLATINUM AND GOLD, INC. AND SUBSIDIARY
(a Development Stage Company)
Notes to Financial Statements (Continued)
(4) ACQUISITIONS
On November 11, 1998, the Company acquired Platinum and Gold Recording and
Publishing Company in a business combination accounted for as a pooling of
interests. Platinum and Gold Recording and Publishing Company, which engages in
the development and commercialization of unique compact disc single and
cassettes became a wholly owned subsidiary of the Company through the exchange
of 10,000,000 shares of the Company's common stock for all of the issued and
outstanding stock of Platinum and Gold Recording and Publishing Company.
Results of operations of the separate companies have not been presented as the
Company did not have any operations since inception other than its organization.
(5) OTHER ASSETS
Other assets consist of the following:
December 31,
1999 1998
---------------- -----------------
Deferred production costs $ 19,546 $ 18,683
Organization costs 12,800 16,000
Security deposits 200
---------------- -----------------
Totals $ 32,346 $ 34,883
---------------- -----------------
(6) STOCKHOLDER LOANS
Since the inception of the Company, the principal stockholder has loaned the
Company the necessary funds to operate the business. These loans are
non-interest bearing and unsecured.
(7) NOTE PAYABLE
A convertible note, issued on December 14, 1999, in the amount of $200,000 for
the benefit of Professional Acquisitions Management and Marketing Corp. This
note, if not paid in one year, will be converted into Rule 144 Restricted Common
Stock of the Company. Interest on the unpaid principal balance of this Note at
the rate of nine percent (9%) per annum shall accrue from the date thereof and
shall be payable to the payee in share of Common Stock of the Company at the
maturity Date.
(continued)
F-9
<PAGE>
PLATINUM AND GOLD, INC. AND SUBSIDIARY
( a Development Stage Company)
Notes to Financial Statements (Continued)
(8) STOCKHOLDERS' EQUITY
The Company sold 1,600,000 shares of its common stock in a Regulation D exempt
offering in February 1997 at a subscription price of $.01 per share. A total of
$ 16,000 was received from the sale of stock and was used to pay all of the
costs associated with the offering and the organization of the Company. On
November 11, 1998, the Company completed a merger with Platinum and Gold
Recording and Publishing Company. (See Note 4)
The Company also has 1,000,000 shares of $ .001 par value preferred stock, none
of which has been issued as of December 31, 1999.
(9) One of the founding and primary shareholders of the company, Carol Neal,
passed away on December 29, 1999.
F-10
<PAGE>
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a) of the Exchange Act
(a) Set forth below are the names, ages, positions, with the Company and
business experiences of the executive officers and directors of the Company.
Name Age Position(s) with Company
- ---------------- -- ----------------------------------
Louise Cavell 56 President, Treasurer and Chairman
Valerie Peters 61 Vice-President, Secretary and Director
Glenda Grainger-Miller 55 Director
Randy Bernsen 46 Director
Margaret Ann Ronayne 49 Director
All directors hold office until the next annual meeting of the Company's
shareholders and until their successors have been elected and qualify. Officers
serve at the pleasure of the Board of Directors. The officers and directors will
devote such time and effort to the business and affairs of the Company as may be
necessary to perform their responsibilities as executive officers and/or
directors of the Company.
<PAGE>
Family Relationships
There are no family relationships between or among the executive officers
and directors of the Company.
Business Experience
Louise Cavell, age 56, currently serves as a President, Treasurer and
Chairman. She has served in these capacities since the death of Carol Neal in
December 1999. She obtained a Real Estate Broker's License in 1977, which is
still active. Ms. Cavell graduated from Newfield High School in 1962. Since
1981, Ms. Cavell has co-owned and co-managed Sunglass Haven with Ms. Peters.
Also between the years of 1992 and 1995, she owned a cocktail lounge located in
Davie, Florida.
Valerie Peters, age 61, currently serves as Vice-President, Secretary and a
Director. She has served as Vice-President and as a Director since the Share
Exchange in November 1998 and as Secretary since the death of Ms. Neal in
December 1999. Since 1981, Ms. Peters has co- owned and co-managed Sunglass
Haven, a high-end wholesale/retail outfitter for annual local and national trade
shows. Sunglass Haven provides specialty eyewear for the marine/water sport
industry. Ms. Peters graduated from Wm. Culen Bryant High School in 1956.
Glenda Grainger-Miller, age 55, currently serves as a Director. She has
served in this capacity since the Share Exchange in November 1998. Ms.
Grainger-Miller worked for Miller- Reich Productions, Inc. as a Production
Associate and Executive Administrator in North Miami Beach, Florida from 1972 to
1994. Between January and May 1995, she produced Cruise Ship Revue Shows for
Holland America Cruise Lines in Miami Florida for Glen-Scott Productions, Inc.
She currently works for FJM Productions, Inc. in Coral Springs, Florida, where
she is an Associate Producer, Executive Administrator and Executive Assistant to
the President. Ms. Grainger-Miller graduated from Great Britain High School in
1962. She is fluent (written and conversational) in French and Spanish and also
speaks conversational Italian.
Randy Bernsen, age 46, currently serves as a Director. He has served the
Company in this capacity since the Share Exchange in November 1998. Mr. Bernsen
currently owns a digital recording studio, where he has produced his own work as
well as the work of other artists. Mr. Bernsen travels annually to Southeast
Asia and Europe to perform in concert with other jazz musicians. He also teaches
music and performs locally. Mr. Bernsen graduated from Plantation High School in
1972.
Margaret Ann Ronayne, age 49, currently serves as a Director. She has
served the Company in this capacity since December 1999. Ms. Ronayne has worked
as National Top 40's Promotional Director of Arista Records since 1993. There
she is responsible for radio exposure for Whitney Houston, Aretha Franklin,
Kenny G., Barry Manilow, Tony Braxton, Puff Daddy and others. Ms. Ronayne
graduated from St. Thomas Aquinas High School in 1969.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
No Director, Officer, Beneficial Owner of more than ten percent (10%) of
any class of equity securities of the Company failed to file on a timely basis
reports required by Section 16(a)
<PAGE>
of the Exchange Act during the most recent fiscal year or prior fiscal years.
Item 10. Executive Compensation
<TABLE>
<CAPTION>
Name Year Annual Annual Annual LT Comp LT LTIP All
and Post Comp Comp Comp Rest Comp Payouts Other
Salary Bonus Other Stock Options (1)
(1) ($)
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Louise 1998 $0 (2)
Cavell,
President, 1999 $0
Treasurer
and
Chairman
- -------------------------------------------------------------------------------
Valerie 1998 $0 (2)
Peters, Vice-
President, 1999 $0
Secretary
and Director
- -------------------------------------------------------------------------------
Glenda 1998 $0
Grainger-
Miller, 1999 $0 (3)
Director
- -------------------------------------------------------------------------------
Randy 1998 $0
Bernsen,
Director 1999 $0 (4)
- -------------------------------------------------------------------------------
Margaret 1998 $0
Ann
Ronayne, 1999 $0 (5)
Director
- ---------------
</TABLE>
(1) All other compensation includes certain health and life insurance benefits
paid by the Company on behalf of its employees.
(2) In November 1998, the Company entered into a share exchange agreement with
PGRP, and its shareholders which had been formed in June 1997. The exchange
was made whereby the Company issued 10,000,000 shares of its restricted
common stock to the shareholders of PGRP for all of the issued and
outstanding stock of PGRP. As part of the exchange, Ms. Neal, Ms. Peters
and Ms. Cavell received 6,000,000, 2,000,000 and 2,000,000 shares of the
Company's restricted common stock respectively. This offering was conducted
pursuant to Section 4(2) of the Act and Rule 506 and Section 517.061(11) of
<PAGE>
the Florida Code. See Part III, Item 11. "Security Ownership of Certain
Beneficial Owners and Management"; and Part III, Item 12. "Certain
Relationships and Related Transactions".
(3) In November 1998, prior to its acquisition by the Company, PGRP entered
into an agreement with Glenda Grainger to be a Director of PGRP. As
compensation, Glenda Grainger was promised 10,000 shares of the restricted
common stock of the Company upon the share exchange to be conducted in
November 1998. The shares were issued in January 1999 pursuant to Section
4(2) of the Act, Rule 506 and Section 517.061(11) of the Florida code. See
Part I, Item 7. "Certain Relationships and Related Transactions"; and Part
II, Item 4. "Recent Sales of Unregistered Securities."
(4) In October 1998, prior to its acquisition by the Company, PGRP entered into
an agreement with Randy Bernsen to be a Director of PGRP. The term was
until the next annual meeting of the shareholders and directors. As
compensation, Randy Bernsen was promised 10,000 shares of the restricted
common stock of the Company upon the share exchange to be conducted in
November 1998. The shares were issued in January 1999 pursuant to Section
4(2) of the Act, Rule 506 and Section 517.061(11) of the Florida code. See
Part I, Item 7. "Certain Relationships and Related Transactions"; and Part
II, Item 4. "Recent Sales of Unregistered Securities."
(5) In January 1999, the Company issued 10,000 shares of its restricted common
stock to Margaret Ann Ronayne in connection with her agreement to serve on
the Company's Board and a Representation Agreement entered into in December
1998. The shares were issued pursuant to Section 4(2) of the Act, Rule 506
and Section 517.061(11) of the Florida code. See Part I, Item 7. "Certain
Relationships and Related Transactions"; and Part II, Item 4. "Recent Sales
of Unregistered Securities."
(6) In September 1999, the Company executed a Promissory Note in favor of Carol
Neal, the Company's past Chairman, President and Treasurer in the amount of
$24,600. The Note was in exchange for monies lent by Ms. Neal to the
Company for working capital. The Note has since been repaid by the Company.
See Part III, Item 11. "Security Ownership of Certain Beneficial Owners and
Management"; and Part III, Item 12. "Certain Relationships and Related
Transactions".
Compensation of Directors
The Company has no standard arrangements for compensating the directors of
the Company for their attendance at meetings of the Board of Directors.
Item 11. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information as of March 30, 2000, regarding
the ownership of the Company's Common Stock by each shareholder known by the
Company to be the beneficial owner of more than five percent (5%) of its
outstanding shares of Common Stock, each director and all executive officers and
directors as a group. Except as otherwise indicated, each of the shareholders
has sole voting and investment power with respect to the share of Common Stock
beneficially owned.
<PAGE>
<TABLE>
<CAPTION>
Name and Address of Title of Amount and Nature of Percent of
Beneficial Owner Class Beneficial Owner Class
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Carol Neal(2)(3) Common 6,000,000 48.3%
Valerie Peters(2) Common 2,000,000 16.1%
Louise Cavell(2) Common 2,000,000 16.1%
Glenda Grainger-Miller(4) Common 10,000 0.1%
Randy Bernsen(5) Common 10,000 0.1%
Margaret Ann Ronayne(6) Common 10,000 0.1%
All Executive Officers and Common 10,030,000 80.7%
Directors as a Group
(six (6) persons)
- -------------------
</TABLE>
(3) The address for each of the above is c/o Platinum and Gold, Inc., 12724
N.W. 11th Court, Sunrise, FL 33323.
(4) In November 1998, the Company entered into a share exchange agreement with
PGRP, and its shareholders which had been formed in June 1997. The exchange
was made whereby the Company issued 10,000,000 shares of its restricted
common stock to the shareholders of PGRP for all of the issued and
outstanding stock of PGRP. As part of the exchange, Ms. Neal, Ms. Peters
and Ms. Cavell received 6,000,000, 2,000,000 and 2,000,000 shares of the
Company's restricted common stock respectively. This offering was conducted
pursuant to Section 4(2) of the Act and Rule 506 and Section 517.061(11) of
the Florida Code. See Part III, Item 12. "Certain Relationships and Related
Transactions".
(3) In September 1999, the Company executed a Promissory Note in favor of Carol
Neal, the Company's past Chairman, President and Treasurer in the amount of
$24,600. The Note was in exchange for monies lent by Ms. Neal to the
Company for working capital. The Note has since been repaid by the Company.
See Part III, Item 12. "Certain Relationships and Related Transactions".
(4) In November 1998, prior to its acquisition by the Company, PGRP entered
into an agreement with Glenda Grainger to be a Director of PGRP. As
compensation, Glenda Grainger was promised 10,000 shares of the restricted
common stock of the Company upon the share exchange to be conducted in
November 1998. The shares were issued in January 1999 pursuant to Section
4(2) of the Act, Rule 506 and Section 517.061(11) of the Florida code. See
Part III, Item 12. "Certain Relationships and Related Transactions".
<PAGE>
(5) In October 1998, prior to its acquisition by the Company, PGRP entered into
an agreement with Randy Bernsen to be a Director of PGRP. The term was
until the next annual meeting of the shareholders and directors. As
compensation, Randy Bernsen was promised 10,000 shares of the restricted
common stock of the Company upon the share exchange to be conducted in
November 1998. The shares were issued in January 1999 pursuant to Section
4(2) of the Act, Rule 506 and Section 517.061(11) of the Florida code. See
Part III, Item 12. "Certain Relationships and Related Transactions".
(6) In January 1999, the Company issued 10,000 shares of its restricted common
stock to Margaret Ann Ronayne in connection with her agreement to serve on
the Company's Board and a Representation Agreement entered into in December
1998. The shares were issued pursuant to Section 4(2) of the Act, Rule 506
and Section 517.061(11) of the Florida code. See Part III, Item 12.
"Certain Relationships and Related Transactions".
There are no arrangements which may result in the change of control of the
Company, although pending disposition of the estate of Ms. Neal, 6,000,000
shares of the Company's Common Stock will be transferred into the name of a
beneficiary, which shares have been held by Ms. Neal for a period of more than
one (1) year and which holding period may "tack" to the beneficiary under Rule
144.
Item 12. Certain Relationships and Related Transactions
In February 1997, prior to its acquisition of PGRP, the Company sold
1,720,000 shares of its unrestricted common stock to 70 individuals for $17,200.
For such offering, the Company relied upon Section 3(b) of the Act, Rule 504,
Section 517.061(11) of the Florida code, Section 90.530(11) of the Nevada code,
Section 48-2-103(b)(4) of the Tennessee code and Section 5[581-5]I(c) of the
Texas code. No state exemption was necessary for the sales made to Canadian or
French investors.
In July 1997, prior to its acquisition of PGRP, the Company conducted a 1
for 4 reverse split of its common stock. This transaction was effected by the
Company's Board of Directors in accordance with the Company's Articles of
Incorporation and Bylaws and also in accordance with Nevada law.
In July 1997, prior to its acquisition of PGRP, the Company entered into a
share exchange agreement with FAD and its shareholders which had been formed in
February 1997. The exchange was made whereby the Company issued 2,970,000 shares
of its restricted common stock to the shareholders of FAD for all of the issued
and outstanding stock of FAD. This offering was conducted pursuant to Section
4(2) of the Act, Rule 506 and Section 517.061(11) of the Florida Code.
In August 1998, prior to its acquisition of PGRP, the Company entered into
a Recission and Cancellation Agreement with FAD and its shareholders, thereby
returning the parties to their original positions prior to the share exchange
conducted in July 1997 ab initio. Thus, FAD exchanged 2,970,000 shares of common
<PAGE>
stock of the Company for 100% of the issued and outstanding stock of FAD and FAD
was no longer a wholly-owned subsidiary of the Company.
In October 1998, prior to its acquisition of PGRP, the Company conducted a
4 for 1 forward split of its common stock. This transaction was effected by the
Company's Board of Directors in accordance with the Company's Articles of
Incorporation and Bylaws and also in accordance with Nevada law.
In October 1998, prior to its acquisition by the Company, PGRP entered into
an agreement with Randy Bernsen to be a Director of PGRP. The term was until the
next annual meeting of the shareholders and directors. As compensation, Randy
Bernsen was promised 10,000 shares of the restricted common stock of the Company
upon the share exchange to be conducted in November 1998. The shares were issued
in January 1999 pursuant to Section 4(2) of the Act, Rule 506 and Section
517.061(11) of the Florida code.
In November 1998, prior to its acquisition by the Company, PGRP entered
into an agreement with Glenda Grainger to be a Director of PGRP. As
compensation, Glenda Grainger was promised 10,000 shares of the restricted
common stock of the Company upon the share exchange to be conducted in November
1998. The shares were issued in January 1999 pursuant to Section 4(2) of the
Act, Rule 506 and Section 517.061(11) of the Florida code.
In November 1998, the Company entered into a share exchange agreement with
PGRP, and its shareholders which had been formed in June 1997. The exchange was
made whereby the Company issued 10,000,000 shares of its restricted common stock
to the shareholders of PGRP for all of the issued and outstanding stock of PGRP.
As part of the exchange, Ms. Neal the Company's past President and Chairman, Ms.
Peters the Company's current Vice-President, Secretary and Director and Ms.
Cavell, the Company's current President, Treasurer and Chairman received
6,000,000, 2,000,000 and 2,000,000 shares of the Company's restricted common
stock respectively. Ms. Neal passed away in December 1999. Her shares are still
titled in her name pending disposition of her estate. This offering was
conducted pursuant to Section 4(2) of the Act and Rule 506 and Section
517.061(11) of the Florida Code.
In January 1999, the Company issued 10,000 shares of its restricted common
stock to Margaret Ann Ronayne in connection with her agreement to serve on the
Company's Board of Directors and a Representation Agreement entered into in
December 1998. The shares were issued pursuant to Section 4(2) of the Act, Rule
506 and Section 517.061(11) of the Florida code.
In January 1999, the Company conducted an offering of its unrestricted
common stock pursuant to section 3(b) of the Act and Rule 504. No shares were
sold thereunder.
In April 1999, the Company sold 1,000 shares of its unrestricted common
stock to one (1) investor for $850. For such offering, the Company relied upon
Section 3(b) of the Act, Rule 504 and Section 90.530(11) of the Nevada code.
In July 1999, the Company initiated an offering of its Convertible Notes.
The Notes have a term of one (1) year, bear interest at a rate of nine percent
(9%) and are automatically convertible to shares of the Company's Common Stock
<PAGE>
in one (1) year (if they are not converted earlier) at a price of $1.00 per
share plus interest, which interest is also payable in shares of the Company's
Common Stock. To date, one (1) note has been sold in the principal amount of
$200,000 in December 1999. The offering is ongoing. For such offering, the
Company relied upon Section 3(b) of the Act, Rule 504 and Section 517.061(11) of
the Florida Code.
In September 1999, the Company executed a Promissory Note in favor of Carol
Neal, the Company's Chairman, President and Treasurer in the amount of $24,600.
The Note was in exchange for monies lent by Ms. Neal to the Company for working
capital. The Note has since been repaid by the Company.
In November 1999, the Company entered into a consulting contract with Joyce
Research Group, Inc. to provide financial public relations services to the
Company. As payment for these services, the Company committed to pay $225,000 or
to issue shares of its "free-trading" Common Stock within a six (6) month
period. An initial payment of $50,000 was made in December 1999.
In November and December 1999, the Company entered into consulting
contracts with three (3) individuals to provide financial, public and investor
relations services to the Company. As payment for such services, the Company
issued 800,000 shares of its Common Stock and paid $20,000 For such offering,
the Company relied upon Section 3(b) of the Act, Rule 701, NSMIA, Section
517.061(11) of the Florida Code and Section 10-5-9(13) of the Georgia Code.
Item 13. Exhibits and Reports on Form 8-K.
(a) The exhibits required to be filed herewith by Item 601 of Regulation S-B, as
described in the following index of exhibits, are incorporated herein by
reference, as follows:
Exhibit No. Exhibit Name
- ------------ ---------------------
3.(i).1 [1] Articles of Incorporation of Integra Ventures, Inc. filed
February 19, 1997.
3.(i).2 [1] Certificate of Amendment of Articles of Incorporation changing
name to First Aid Direct, Inc. filed July 25, 1997.
3.(i).3 [1] Certificate of Amendment of Articles of Incorporation changing
name to Platinum and Gold, Inc.
3.(ii).1 [1] Bylaws of Integra Ventures, Inc.
4.1 [1] Form of Private Placement Offering of 1,600,000 common shares at
$0.01 per share.
4.2 [1] Form of Private Placement Offering of 984,000 common shares at
$1.00 per share.
4.3 [1] Form of Private Placement Offering of 9% convertible notes at
$10,000 per Unit.
4.4 [1] Form of Convertible Note pursuant to 9% convertible note offering
4.5 * 9% Convertible Note in favor of Professional Acquisitions
Management & Marketing Corp. dated December 14, 1999.
<PAGE>
10.1 [1] Share Exchange Agreement between Integra Ventures, Inc. and First
Aid Direct, Inc. dated July 23, 1997.
10.2 [1] Recission and Cancellation Agreement between First Aid Select,
Inc. d/b/a First Aid Direct and Integra Ventures, Inc. dated
August 28, 1998.
10.3 [1] Share Exchange Agreement between Platinum and Gold, Inc. and
shareholders of Platinum and Gold Recording & Publishing Company
dated November 11, 1998.
10.4 [1] Agreement with Randy Bernsen dated October 28, 1998.
10.5 [1] Agreement with Glenda Grainger-Miller dated November 1, 1998.
10.6 [1] Agreement with B&D Productions dated September 3, 1999.
10.7 [1] Letter of Intent with Steve Jordan dated July 1, 1998.
10.8 [1] Agreement with Barbara Chadwick dated September 3, 1999.
10.9 [1] Agreement with Beverly Fortin dated September 3, 1999.
10.10 [1] Promissory Note with Carol Neal dated September 7, 1999.
10.11 [1] Agreement with Margaret Ann Ronayne dated December 2, 1998.
10.12 * Financial Public Relations Consulting Agreement with Joyce
Research Group, Inc. dated November 1, 1999.
10.13 * Consulting Agreement with Elyse R. Doss dated November 5, 1999.
10.14 * Consulting Agreement with Mark F. Jordan dated December 7, 1999.
10.15 * Consulting Agreement with David C. Osborne dated December 7, 1999
27.1 * Financial Data Schedule.
- ----------------
(* Filed herewith)
[1] Previously filed with the Company's Form 10SB filed October 14, 1999
(b) No Reports on Form 8-K were filed during the last fiscal year ended December
31, 1999, covered by this Annual Report on Form 10-KSB.
* Filed herein
<PAGE>
SIGNATURE
In accordance with Section 13 and 15(d) of the Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Platinum and Gold, Inc.
(Registrant)
Date: March 30, 2000 By:/s/ Louise Cavell
------------------------------------
Louise Cavell, President, Treasurer and Chairman
By:/s/ Valerie Peters
------------------------------------
Valerie Peters, Vice-President, Secretary and Director
By:/s/ Glenda Grainger-Miller
------------------------------------
Glenda Grainger-Miller, Director
By:/s/ Randy Bernsen
------------------------------------
Randy Bernsen, Director
By:/s/ Margaret Ann Ronayne
------------------------------------
Margaret Ann Ronayne, Director
Pursuant to the requirements of the Exchange Act, this report has been
signed by the following persons in the capacities and on the dates indicated.
Signature Title Date
/s/Louise Cavell President, Treasurer March 30, 2000
- ------------------------- and Chairman
Louise Cavell
/s/Valerie Peters Vice-President Secretary March 30, 2000
- ------------------------- and Director
Valerie Peters
/s/Glenda Grainger-Miller Director March 30, 2000
- -------------------------
Glenda Grainger-Miller
/s/Randy Bernsen Director March 30, 2000
- -------------------------
Randy Bernsen
/s/Margaret Ann Ronayne Director March 30, 2000
- -------------------------
Margaret Ann Ronayne
This Note, and the securities issuable upon the conversion of this Note, have
not been registered under the Securities Act of 1933, as amended (the "Act") or
applicable state law and may not be sold, transferred or otherwise disposed of
unless registered under the Act and any applicable state act or unless the
Company receives an opinion from counsel for the holder and is satisfied that
this Note and the underlying securities may be transferred without registration
under the Act.
CONVERTIBLE NOTE
$200,000 As of December 14, 1999
Palm Beach, Florida
FOR VALUE RECEIVED, PLATINUM AND GOLD, INC., a Nevada corporation (the
"Company"), hereby promises to pay to the order of Professional Acquisitions
Management & Marketing Corp., or any subsequent holder of this Note (the
"Payee"), at 607 S. Alexander Street, Suite 107, Plant City, FL 33566, or at
such other place as may be designated by the Payee from time to time by notice
to the Company, the principal sum of Two Hundred Thousand Dollars ($200,000),
together with simple interest from the date hereof (the "Issuance Date") on the
unpaid principal amount at an annual rate equal to nine percent (9%) per annum.
Such principal and interest shall be paid in accordance with the terms of
Section 1 below, to such account as the Payee shall direct.
1. PAYMENTS.
(a) The unpaid principal amount of this Note shall be converted into Rule 144
Restricted Common Stock of the Company as provided herein on or before December
14, 2000 (the "Maturity Date").
(b) Interest on the unpaid principal balance of this Note at the rate of nine
percent (9%) per annum shall accrue from the date hereof and shall be payable to
the Payee in shares of Common Stock of the Company at the Maturity Date, the
number of which shall be equal to the product of such interest payment divided
by the Conversion Price, as defined herein, with the overage, if any, payable in
cash. Interest shall be calculated on the basis of a 365 day year.
(c) In the event that any payment of principal and/or interest hereunder becomes
due and payable on a Saturday, Sunday or other day on which commercial banks in
the State of Florida are authorized or required by law to close, then the
maturity thereof shall be extended to the next succeeding "Business Day"
(defined as any days on which national banks in the United States are open for
business); and during any such extension, interest on principal amounts payable
shall accrue and be payable at the applicable rate.
1
<PAGE>
2. RANKING OF NOTE.
Subject at all times to the subordination provisions set forth in
Section 9 hereof, this Note shall constitute senior securities of the Company
and, except as provided below, shall rank pari passu with all other indebtedness
for money borrowed by the Company and senior to any other indebtedness for money
borrowed by the Company which, by its terms shall be made expressly subject and
subordinated to this Note.
3. PREPAYMENT OF NOTE.
(a) Prior to the Maturity Date, the Company shall provide the holder with a
notice that a prepayment event has occurred (the "Prepayment Notice"). The
holder shall have thirty (30) days from the date of the Prepayment Notice to
elect (i) to take prepayment of the principal amount of the Note and any accrued
but unpaid interest in whole without premium or penalty or (ii) to convert in
accordance with Section 4 hereof.
(b) Notwithstanding anything to the contrary set forth in Section 3(a) hereof,
subject at all times to the holder's right to convert all or any portion of this
Note into Common Stock pursuant to Section 4 hereof, the principal amount of
this Note and any accrued and unpaid interest may be prepaid, at the option of
the Company, in whole or in part, without premium or penalty, at any time or
from time to time from and after that date which shall be the earlier to occur
of (i) the Maturity Date or (ii) the date on which the Company shall register
for resale pursuant to the Securities Act of 1933, as amended (the "Act") all
"Conversion Shares" (as herein defined) issuable upon conversion of the entire
principal amount of this Note, pursuant to a Registration Statement on the
appropriate registration form declared effective by the Securities and Exchange
Commission (the "SEC"). If either event set forth in this Section 3(b) shall
occur, the Company shall provide the holder with a Prepayment Notice.
(c) Each Prepayment Notice shall specify the principal amount of this Note to be
redeemed. Each prepayment of principal of this Note shall be accompanied by the
payment of all interest accrued and unpaid to the prepayment date on the amount
so prepaid. Each such prepayment shall be made by wire transfer of immediately
available funds or by bank cashier's check payable to the Payee. Any partial
prepayment of this Note, whether optional or mandatory, shall be applied first
to accrued and unpaid interest hereon, and then to the outstanding principal
amount of this Note in the inverse order of maturity.
4. CONVERSION.
Subject at all times to the Company's right to prepay the Notes as provided in
Section 3 hereof, the holders of the Notes shall have the following conversion
rights (the "Conversion Rights"):
(a) Voluntary Conversion. At any time or from time to time following the
Issuance Date, the holder of this Note may elect to convert up to one hundred
(100%) percent of the original principal amount of this Note and any accrued but
unpaid interest, into shares of Common Stock of the
2
<PAGE>
Company at the Conversion Price, by written notice given to the Company in
accordance with the provisions of Section 4(g) hereof (the "Conversion Notice").
In no event may the holder of this Note effect a conversion of less than $10,000
principal amount of this Note. Such right of Voluntary Conversion shall be
effected by the surrender of this Note to the Company for conversion at any time
during normal business hours at the office of the Company, accompanied (i) by
the Conversion Notice, (ii) if so required by the Company, by instruments of
transfer, in a form satisfactory to the Company, duly executed by the registered
holder or by his duly authorized attorney and (iii) transfer tax stamps or funds
therefore, if required pursuant to Section 4(f) herein.
(b) Automatic Conversion. Effective as of the Maturity Date, to the extent not
previously converted by the holder, all remaining principal amount of this Note,
together with all accrued interest hereon, shall automatically and without
further action on the part of such holder be converted into Common Stock of the
Company at the Conversion Price.
(c) Conversion Price. Subject to adjustment from time to time as provided in
Section 4(d) below, the term "Conversion Price" shall mean $1.00 per share of
common stock.
(d) Adjustments of Conversion Price. The Conversion Price in effect from time to
time shall be, subject to adjustment in accordance with the provisions of this
Section 4(d).
(i) Adjustments for Stock Splits and Combinations. If the Company shall
at any time or from time to time after the Issuance Date, effect a stock split
of the outstanding Common Stock, the Conversion Price in effect immediately
prior to the stock split shall be proportionately decreased. If the Company
shall at any time or from time to time after the Issuance Date, combine the
outstanding shares of Common Stock, the Conversion Price in effect immediately
prior to the combination shall be proportionately increased. Any adjustments
under this Section 4(d)(i) shall be effective at the close of business on the
date the stock split or combination occurs.
(ii) Adjustments for Certain Dividends and Distributions. If the
Company shall at any time or from time after the Issuance Date, make or issue or
set a record date for the determination of holders of Common Stock entitled to
receive a dividend or other distribution payable in shares of Common Stock,
then, and in each event, the Conversion Price in effect immediately prior to
such event shall be decreased as of the time of such issuance or, in the event
such a record date shall have been fixed, as of the close of business on such
record date, by multiplying the Conversion Price then in effect by a fraction;
(A) the numerator of which shall be the total number of shares
of Common Stock issued and outstanding immediately prior to the time of such
issuance or the close of business on such record date; and
(B) the denominator of which shall be the total number of
shares of Common Stock issued and outstanding immediately prior to the time of
such issuance or the close of business on such record date plus the number of
shares of Common Stock issuable in payment of such dividend or distribution.
3
<PAGE>
(iii) Adjustments for Other Dividends and Distributions. If the Company
shall at any time or from time to time after the Issuance Date, make or issue or
set a record date for the determination of holders of Common Stock entitled to
receive a dividend or other distribution payable in other than shares of Common
Stock, then, and in each event, an appropriate revision to the Conversion Price
shall be made and provision shall be made (by adjustments of the Conversion
Price or otherwise) so that the holder of this Note shall receive upon
conversions thereof, in addition to the number of shares of Common Stock
receivable thereon, the number of securities of the Company which they would
have received had this Note been converted into Common Stock on the date of such
event and had thereafter, during the period from the date of such event to and
including the Conversion Date, retained such securities (together with any
distributions payable thereon during such period), giving application to all
adjustments called for during such period under this Section 4(c)(iii) with
respect to the rights of the holders of the Note.
(iv) Adjustments for Reclassification, Exchange or Substitution. If the
Common Stock issuable upon conversion of this Note at any time or from time to
time after the Issuance Date shall be changed into the same or a different
number of shares of any class or classes of stock, whether by reclassification,
exchange, substitution or otherwise (other than by way of a stock split or
combination of shares or stock dividends provided for in Sections 4(d)(i), (ii)
and (iii), or a reorganization, merger, consolidation, or sale of assets
provided for in Section 4(d)(v)), then, and in each event, an appropriate
revision to the Conversion Price shall by made and provisions shall be made (by
adjustments of the Conversion Price of otherwise) so that the holder of this
Note shall have the right thereafter to convert such Note into the kind and
amount of shares of stock and other securities receivable upon such
reclassification, exchange, substitution or other change, by holders of the
number of shares of Common Stock into which such Note might have been converted
immediately prior to such reclassification, exchange, substitution or other
change, all subject to further adjustment as provided herein.
(v) Adjustments for Reorganization, Merger, Consolidation or Sales of
Assets. If at any time or from time to time after the Issuance Date there shall
be a capital reorganization of the Company (other than by way of a stock split
or combination of shares or stock dividends or distributions provided for in
Section 4(d)(i), (ii) and (iii), or a reclassification, exchange or substitution
of shares provided for in Section 4(d)(iv)), or a merger or consolidation of the
Company with or into another corporation, or the sale of all or substantially
all of the Company's properties or assets to any other person, then as a part of
such reorganization, merger, consolidation, or sale, an appropriate revision to
the Conversion Price shall be made and provision shall be made (by adjustments
of the Conversion Price or otherwise) so that the holder of this Note shall have
the right thereafter to convert this Note into the kind and amount of shares of
stock and other securities or property of the Company or any successor
corporation resulting from such reorganization, merger, consolidation, or sale,
to which a holder of Common Stock deliverable upon conversion of such shares
would have been entitled upon such reorganization, merger, consolidation, or
sale. In any such case, appropriate adjustment shall be made in the application
of the provisions of this Section 4(d)(v) with respect to the rights of the
holders of this Note after the reorganization, merger, consolidation, or sale to
the end that the provisions of this Section 4(c)(v) (including any adjustment in
4
<PAGE>
the Conversion Price then in effect and the number of shares of stock or other
securities deliverable upon conversion of this Note) shall be applied after that
event in as nearly an equivalent manner as may be practicable.
(d) No Impediment. The Company shall not, by amendment of its Certificate of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed hereunder by the Company, but will at all times in good
faith, assist in the carrying out of all the provisions of this Section 4 and in
the taking of all such action as may be necessary or appropriate in order to
protect the conversion rights of the holders of the Note set forth in this
Section 4 against impairment.
(e) Certificate as to Adjustments. Upon occurrence of each adjustment or
readjustment of the Conversion Price or number of shares of Common Stock
issuable upon conversion of the Note pursuant to this Section 4, the Company at
its expense, shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and furnish notice to the holder of this Note,
a certificate setting forth such adjustment and readjustment, showing in detail
the facts upon which such adjustment or readjustment is based. The Company
shall, upon written request of the holder of this Note, at any time, furnish or
cause to be furnished to such holder a like certificate setting forth such
adjustments and readjustments, the applicable Conversion Price in effect at the
time and the number of shares of Common Stock and the amount, if any, of other
securities or property which at the time would be received upon the conversion
of such Note. Notwithstanding the foregoing, the Company shall not be obligated
to deliver a certificate unless such certificate would reflect an increase or
decrease of at least one percent (1%) of such adjusted amount.
(f) Issue Taxes. The Company shall pay any and all issue and other taxes,
excluding federal, state or local income taxes, that may be payable in respect
of any issue or delivery of shares of Common Stock on conversion of this Note
pursuant hereto; provided, however, that the Company shall not be obligated to
pay any transfer taxes resulting from any transfer requested by any holder in
connection with any such conversion.
(g) Notices and Delivery of Shares. All notices and other communications
hereunder shall be in writing and shall be deemed given (i) on the same date, if
delivered personally or by facsimile by not later than 5:00 p.m. Florida time
(provided, that a copy of such facsimile shall be simultaneously sent to Donald
F. Mintmire, Esq. at (561)659-5371, or (ii) three business days following being
mailed by certified or registered mail, postage prepaid, return-receipt
requested, addressed to the party in accordance with Section 7 hereof. Not later
than seven (7) Business Days following receipt of notice of conversion as
provided herein (the "Delivery Date"), the Company shall deliver to the holders
of this Note, against delivery of this Note surrendered for conversion,
certificates evidencing all shares of Common Stock into which this Note shall be
converted.
(h) Fractional Shares. No fractional shares of Common Stock shall be issued upon
conversion of the Note. In lieu of any fractional shares to which the holder
would otherwise be entitled, the Company shall pay cash equal to the product of
such fraction multiplied by the Conversion Price of one share of the Company's
Common Stock on the applicable Conversion Date.
5
<PAGE>
(i) Reservation of Common Stock. The Company shall at all times reserve and keep
available, out of its authorized but unissued shares of Common Stock, solely for
the purpose of effecting the conversion of the Note, the full number of shares
deliverable upon conversion of all the Note from time to time outstanding. The
Company shall, from time to time in accordance with the Nevada General
Corporations Law, as amended, increase the authorized number of shares of Common
Stock if at any time the unissued number of authorized shares shall not be
sufficient to permit the conversion of all of the Note at the time outstanding.
In such connection, the Company shall hold a special meeting of stockholders not
later than 180 days after any date in which the Company shall have insufficient
shares of Common Stock so reserved for the purpose of authorizing additional
shares of Common Stock.
(j) Retirement of Note. Conversion of this Note shall be deemed to have been
effected on the applicable Conversion Date. The converting holder shall be
deemed to have become a stockholder of record of the Common Stock on the
applicable Conversion Date. Upon conversion of only a portion of this Note, the
Company shall issue and deliver to such holder, at the expense of the Company,
against receipt of the original Note delivered for partial cancellation, a new
Note representing the unconverted portion of this Note so surrendered and Common
Stock equal to the portion converted.
(k) Regulatory Compliance.
(i) If any shares of Common Stock to be reserved for the purpose of
conversion of this Note require registration or listing with or approval of any
government authority, stock exchange or other regulatory body under any federal
or state law or regulation or otherwise before such shares may be validly issued
or delivered upon conversion, the Company shall, at its sole cost and expense,
in good faith and as expeditiously as possible, endeavor to secure such
registration, listing or approval, as the case may be.
(ii) The shares of Common Stock issuable upon the election to convert
shall be Rule 144 restricted shares (the "Restricted Securities").
(iii) The holder of such shares shall have the following registration
rights:
(A) Neither this Note nor the Shares underlying it have been
registered under the Securities Act of 1933, as amended (the "Act"). Unless and
until registered under the Act, this Note and all replacement Notes shall bear
the following legend:
This Note, and the securities issuable upon the conversion of this
Note, have not been registered under the Securities Act of 1933, as
amended (the "Act") or applicable state law and may not be sold,
transferred or otherwise disposed of unless registered under the Act
and any applicable state act or unless the Company is satisfied that
this Note and the underling securities may be transferred without
registration under the Act.
6
<PAGE>
(a) This offering is being conducted pursuant to Section 3(b) of the
Securities Act of 1933, as amended (the "Act"), and Rule 504 of Regulation D
promulgated thereunder ("Rule 504") or other applicable provisions, although the
shares issuable upon conversion of this Note shall be Rule 144 restricted
shares. The Company expects to file for an exemption for shares under Regulation
A in the near future. In the event the Company acquires such an exemption under
Regulation A, the Company shall issue Regulation A exempt shares in lieu of such
restricted shares. In addition, upon conversion of this Note, and after issuance
of the Shares, at any time that the Company proposes to file a Company
registration statement on Form S-1 under the Act (the "Registration Statement"),
either for its own account or for the account of a stockholder or stockholders,
the Company shall give the Holder written notice of its intention to do so and
of the intended method of sale (the "Registration Notice") within a reasonable
time prior to the anticipated filing date of the Company's Registration
Statement effecting such Company registration. Holder may request inclusion of
any Restricted Securities in such Registration Statement by delivering to the
Company, within ten (10) Business Days after receipt of the Registration Notice,
a written notice (the "Piggyback Notice") stating the number of Restricted
Securities proposed to be included and that such shares are to be included in
any underwriting only on the same terms and conditions as the shares of Common
Stock otherwise being sold through underwriters under such Company Registration
Statement. The Company shall use its best efforts to cause all Restricted
Securities specified in the Piggyback Notice to be included in the Company
Registration Statement and any related offering, all to the extent requisite to
permit the sale by the Holder of its Restricted Securities in accordance with
the method of sale applicable to the other shares of Common Stock included in
such Company Registration Statement; provided, however, that if, at any time
after giving written notice of its intention to register any securities and
prior to the effective date of the Company Registration Statement filed in
connection with such registration, the Company shall determine for any reason
not to register or to delay registration of Holder's Restricted Securities, the
Company may, at its election, give written notice of such determination to
Holder and, thereupon:
(i) in the ease of a determination not to register, shall be
relieved of its obligation to register Holder's Restricted Securities in
connection with such registration (but not from its obligation to pay the
registration expenses in connection therewith), and
(ii) in the case of a delay in registering, shall be permitted
to delay registering Holder's Restricted Securities for the same period as the
delay in registering such other securities.
(b) The Company's obligation to include Restricted Securities in a
Company's Registration Statement shall be subject to the following limitations:
(i) The Company may elect, at its sole option and for any
reason, not to register Holder's Restricted Shares, provided however, that this
right is limited to one (1) time and relative to one (1) particular Company
Registration Statement.
(ii) The Company shall not be obligated to include any
Restricted Securities in a registration statement filed on Form S-4, Form S-8 or
such other similar successor forms then in effect under the Securities Act.
7
<PAGE>
(iii) If a Company Registration Statement involves an
underwritten offering and the managing underwriter advises the Company in
writing that in its opinion, the number of securities requested to be included
in such Company Registration Statement exceeds the number which can be sold in
such offering without adversely affecting the offering, the Company shall
include in such Company Registration Statement the number of such securities
which the Company is so advised can be sold in such offering without adversely
affecting the offering, determined as follows:
(A) first, the securities proposed by the Company to
be sold for it own account, and
(B) second, any Restricted Securities requested to be
included in such registration and any other securities of the Company in
accordance with the priorities, if and then existing among the holders of such
securities pro rata among the holders thereof requesting such registration on
the basis of the number of shares of such securities requested to be included by
such holders.
(iv) The Company shall not be obligated to include Restricted
Securities in more than one (1) Company Registration Statement.
(c) To the extent Holder's Restricted Securities are intended to be
included in a Company Registration Statement, Holder may include any of its
Restricted Securities in such Company Registration Statement pursuant to this
Agreement only if Holder furnishes to the Company in writing, within ten (10)
business days after receipt of a written request therefore, such information
specified in Item 507 of Regulation S-K under the Act or such other information
as the Company may reasonably request for use in connection with the Company
Registration Statement or Prospectus or preliminary Prospectus included therein
and in any application to the NASD. Holder as to which the Company Registration
Statement is being effected agrees to furnish promptly to the Company all
information required to be disclosed in order to make all information previously
furnished to the Company by Holder not materially misleading.
5. EVENTS OF DEFAULT.
The occurrence and continuance of any one or more of the following events is
herein referred to as an Event of Default:
(a) If the Company shall default in converting the applicable principal amount
of this Note into Common Stock and delivering stock certificates in respect of
such conversion within thirty (30) Business Days from the Company's receipt of
the applicable notice of conversion pursuant to the provisions hereof, whether
on the Maturity Date or otherwise; or
(b) If the Company shall default in the payment of any installment of interest
on this Note when payable in accordance with the terms thereof for more than
sixty (60) calendar days after the same shall become due if the Payee has not
elected to take such interest in Common Stock; and if the Payee has elected to
take such interest in Common Stock, if the Company shall default in delivering
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<PAGE>
stock certificates in respect of such election within sixty (60) Business Days
from the Company's receipt of the notice of such election; or
(c) If the Company shall not, at the time of receipt of a Conversion Notice
hereunder, have a sufficient number of authorized and unissued shares of its
Common Stock available for issuance to the holder of this Note upon conversion
of all or any portion of this Note in accordance with the terms hereof, and such
default shall not have been remedied within one hundred eighty (180) calendar
days from the date of such Conversion Notice; or
(d) If the Company shall default in the performance of or compliance with any of
its material covenants or agreements contained herein and such default shall not
have been remedied within thirty (30) calendar days after written notice thereof
shall have been delivered to the Company by the holder of this Note in
accordance with the notice provisions herein; or
(e) If any representation or warranty made in writing by or on behalf of the
Company in connection with the transactions contemplated hereby shall prove to
have been false or incorrect in any material respect on the date as of which
made; or
(f) If the Company or any of its "Significant Subsidiaries" (as defined herein)
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts as they become due, or shall file a voluntary
petition in bankruptcy or shall have an order for relief under the Bankruptcy
Act granted against it or them, or shall be adjudicated a bankrupt or insolvent,
or shall file any petition or answer seeking for itself any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any present or future statute, law or regulation, or shall file any
answer admitting or not contesting the material allegations of a petition filed
against the Company or any of its Significant Subsidiaries in any such
proceeding, or shall seek or consent to or acquiesce in the appointment of any
trustee, custodian, receiver or liquidator of the Company or of all or any
substantial part of the properties of the Company or any of its Significant
Subsidiaries, or the Company or its directors shall take any action looking to
the dissolution or liquidation of the Company or any of its Significant
Subsidiaries. For purposes of this Section 5(f), the term Significant Subsidiary
shall mean and include any other person, firm or corporation (i) more than 50%
of the common stock or equity interests of which are owned of record by the
Company or any Subsidiary of the Company, and (ii) the net income before taxes
or total assets of which represent more than 15% of the consolidated net income
before taxes or consolidated assets of the Company and all of its Subsidiaries;
or
(g) If, within sixty (60) days after the commencement of any proceeding against
the Company or any Significant Subsidiary seeking any reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any present or future statute, law or regulation, such proceeding
shall not have been dismissed, or if, within sixty (60) days after the
appointment, without the consent or acquiescence of the Company or any
Significant Subsidiary, of any trustee, receiver or liquidator of the Company or
any Significant Subsidiary or of all or any substantial part of the properties
of the Company or any Significant Subsidiary, such appointment shall not have
been vacated.
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6. REMEDIES ON DEFAULT; ACCELERATION.
Upon the occurrence and during the continuance of an Event of Default, the
entire unpaid balance of principal and accrued interest on this Note may be
accelerated and declared to be immediately due and payable by the holder in Rule
144 Restricted Shares of the Company's Common Stock. Unless waived by the
written consent of the holder, such holder may proceed to protect and enforce
its rights by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein, or for
an injunction against a violation of any of the terms hereof, or in aid of the
exercise of any power granted hereby or by law. Upon the occurrence of an Event
of Default, the Company agrees to pay to the holder of this Note such further
amount as shall be sufficient to cover the cost and expense of collection,
including, without limitation, reasonable attorneys' fees and expenses. No
course of dealing and no delay on the part of the holder of this Note in
exercising any right, power or remedy shall operate as a waiver thereof or
otherwise prejudice such holder's rights, powers and remedies. No right, power
or remedy conferred hereby upon the holder hereof shall be exclusive of any
other right, power or remedy referred to herein nor now or hereafter available
at law, in equity, by statute or otherwise.
7. NOTICES.
All notices, requests, demands or other communications hereunder shall be in
writing and personally addressed or sent by telecopier or by registered or
certified mail, return receipt requested, postage pre- paid, addressed or
telecopied as follows or to such other address or telecopier number of which
notice has been given pursuant hereto:
If to the Company: Platinum and Gold, Inc.
12724 N.W. 11th Court
Sunrise, FL 33323
Attn: Carol Neal
Telephone: (800) 525-8495
Fax: (954) 845-0656
with copy to: Mintmire & Associates
265 Sunrise Avenue, Suite 204
Palm Beach, FL 33480
Attn: Donald F. Mintmire, Esq.
Telephone: (561) 832-5696
Fax: (561) 659-5371
If to the Holder: to such Holder at the address set forth on the records of
the Company. In addition, copies of all such notices or
other communications shall be concurrently delivered by the
person giving the same to each person who has been
identified to the Company by such Holder as a person who is
to receive copies of such notices.
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<PAGE>
8. GOVERNING LAW.
This Note shall be governed by, and construed and interpreted in accordance
with, the laws of the State of Nevada, without giving effect to conflict of law
principles.
9. SUBORDINATION TO SENIOR DEBT.
(a) Payment of the principal of and interest on this Note is subordinated, to
the extent and in the manner provided herein, to the prior payment of all
indebtedness of the Company and/or all Subsidiaries of the Company, for money
borrowed or other obligations which is now or may hereafter be owed
(collectively, "Senior Debt") to any bank, commercial finance company, factor,
insurance company or other institution the lending activities of which are
regulated by law (individually, a "Senior Lender" and collectively, "Senior
Lenders"), which may, hereafter on any one or more occasions provide financing
to the Company or any of its Subsidiaries, secured by liens on any of the assets
and properties of the Company and/or any of its Subsidiaries (individually and
collectively, an "Institutional Borrower").
(b) Upon any payment or distribution of assets or securities of the
Institutional Borrower, as the case may be, of any kind or character, whether in
cash, property or securities, upon any dissolution or winding up or total or
partial liquidation or reorganization of the Institutional Borrower, whether
voluntary or involuntary or in bankruptcy, insolvency, receivership or other
proceedings, all amounts payable under Senior Debt shall first be paid in full
in cash, or payment provided for in cash or cash equivalents, before the holder
hereof shall be entitled to receive any payment on account of principal of or
interest on this Note. Before any payment may be made by the Institutional
Borrower of the principal of or interest on this Note upon any such dissolution
or winding up or liquidation or reorganization, any payment or distribution of
assets or securities of the Institutional Borrower of any kind of character,
whether in cash, property or securities, to which the holder hereof would be
entitled, except for the provisions of this Section 9, shall be made by the
Institutional Borrower or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or distribution, directly to
the holders of Senior Debt or their representatives to the extent necessary to
pay all such Senior Debt in full after giving effect to any concurrent payment
or distribution to the holders of such Senior Debt.
(c) Upon the happening of any default in payment of the principal of or interest
on any Senior Debt, then, unless and until such default shall have been cured or
waived or shall have ceased to exist, no direct or indirect payment in cash,
property or securities, by set-off or otherwise, shall be made or agreed to be
made by the Institutional Borrower on account of the principal of or interest on
this Note.
(d) Upon the happening of an event of default (other than under circumstances
when the terms of Section 9(c) above are applicable) with respect to any Senior
Debt pursuant to which the holder thereof is entitled under the terms of such
Senior Debt to accelerate the maturity thereof, and upon written notice thereof
given to each of the Institutional Borrower and the holder of this Note by such
holder of Senior Debt ("Payment Notice"), then, unless and until such event of
default shall have been
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<PAGE>
cured or waived or shall have ceased to exist, no action shall or may be taken
for collection of any amounts under this Note, and no direct or indirect payment
in cash, property or securities, by set-off or otherwise, shall be made or
agreed to be made by the Institutional Borrower an account of the principal of
or interest on this Note until such Senior Debt has been paid in full accordance
with its terms.
(e) In the event that, notwithstanding the provisions of this Section 9, any
payment shall be made on account of the principal of or interest on this Note in
contravention of such provisions, then such payment shall be held for the
benefit of, and shall be paid over and delivered to, the holders of such Senior
Debt remaining unpaid to the extent necessary to pay in full in cash or cash
equivalents the principal of and interest on such Senior Debt in accordance with
its terms after giving effect to any concurrent payment or distribution to the
holders of such Senior Debt.
(f) Nothing contained in this Section 9 shall
(i) impair the conversion rights of the holder hereof referred to in
Section 4 above,
(ii) impair, as between the Company and the holder of this Note, the
obligation of the Company, which is absolute and unconditional, to pay to the
holder hereof principal and interest as the same shall become due and payable,
or
(iii) prevent the holder hereof from exercising all rights, powers and
remedies otherwise provided herein or by applicable law, all subject to the
express limitations provided herein.
(g) Upon the occurrence of an Event of Default, if any Senior Debt shall then be
outstanding, no acceleration of the maturity of this Note shall be effective
until the earlier of (i) ten (10) days shall have passed following the date of
delivery to the Institutional Borrower by a Senior Lender(s) of written notice
of acceleration of any Senior Debt, or (ii) the maturity of any then outstanding
Senior Debt shall have been accelerated by reason of a default hereon. The
Company may pay the holder hereof any defaulted payment and all other amounts
due following any such acceleration of the maturity of this Note if this Section
9 would not prohibit such payment to be made at that time.
(h) Upon payment in full of all Senior Debt, the Payee of this Note shall be
subrogated to the rights of the holder or holders of Senior Debt to receive all
payments or distributions applicable on such Senior Debt to the extent of the
prior application thereto of moneys or other assets which would have been
received in respect of this Note, but for these subordination provisions, until
the principal of, and interest on, this Note shall have been paid in full.
(i) The Payee, by accepting this Note
(i) shall be bound by all of the foregoing subordination provisions;
(ii) agrees expressly for the benefit of the present and future holders
of Senior Debt that this
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<PAGE>
Note is subject to the foregoing subordination provisions;
(iii) authorizes such persons as shall be designated by all holders of
Senior Debt at any given time, on his or its benefit to execute and deliver such
agreements, assignments, proofs of claim and other documents appropriate to
effectuate the foregoing subordination provisions; and
(iv) hereby appoints the person so designated his or its attorney-in-
fact for such purpose.
(j) The foregoing subordination provisions shall be for the benefit of all
holders of Senior Debt from time to time outstanding, and each of such holders
may proceed to enforce such provisions either directly against the holder hereof
or in any other manner provided by law.
10. PERMITTED PAYMENTS.
Notwithstanding the provisions of Section 9 of this Note, and provided that no
default or event of default (or event which, with the passage of time or giving
of notice or both) has occurred, will occur as a result of the "Permitted
Payment" (herein defined), or will occur with the passage of time or giving of
notice or both, under any document or instrument evidencing such Senior Debt,
the Company may pay to the Payee, and the Payee may accept from the Company, the
principal payments of, and/or interest payments on, the outstanding principal
amount of this Note when due on an unaccelerated basis (herein, "Permitted
Payments"); it being understood and agreed by the Payee by accepting this Note
that neither:
(a) the payment terms set forth in Section l of this Note;
(b) the subordination provisions contained in Section 9 of this Note, nor
(c) the provisions of this Section 10 of this Note, may be modified or
amended without the prior written consent of each and every holder of
Senior Debt.
11. SUCCESSORS AND ASSIGNS.
This Note shall be binding upon and inure to the benefit of the Company and the
holder hereof and their respective successors and permitted assigns; provided,
however, that the Company may not transfer or assign any of its rights or
obligations hereunder without the prior written consent of the holder hereof;
and provided, further, that transfer or assignment by the holder is in
accordance with the rules governing Restricted Securities.
IN WITNESS WHEREOF, the Company has caused this Note to be executed by its duly
authorized officers as of the date first set forth above.
13
<PAGE>
PLATINUM AND GOLD, INC.
By: /s/ Carol Neal
------------------------
Carol Neal, President
Attest: /s/ Terry Ritchie
---------------------
14
EXHIBIT 10.12
FINANCIAL PUBLIC RELATIONS
CONSULTING AGREEMENT
THIS FINANCIAL PUBLIC RELATIONS CONSULTING AGREEMENT, made this 1st day of
November, 1999 by and between: PLATINUM AND GOLD RECORDING & PUBLISHING CORP.
located at 12724 N.W. 11th Court, Sunrise, FL., 33323 (herein referred to as the
"COMPANY") and JOYCE RESEARCH GROUP, INC. 3200 N. Federal Highway, Suite 221,
Boca Raton, Florida 33431 engaged in providing financial public relations
services (hereinafter referred to as "CONSULTANT").
WITNESSETH THAT:
WHEREAS, the COMPANY requires financial public relations services and
desires to employ CONSULTANT to provide such services as an independent
contractor consultant, and CONSULTANT is agreeable to such employment, and the
parties desire a written document formalizing and defining their relationship
and evidencing the terms of their agreement;
NOW, THEREFORE, intending to be legally bound, and in consideration of the
mutual promises and covenants, the parties have agreed as follows:
1. APPOINTMENT. The COMPANY hereby appoints CONSULTANT as its financial
public relations counsel and hereby retains and employs CONSULTANT, on the terms
and conditions of this Agreement. CONSULTANT accepts such appointment and agrees
to perform the services upon the terms and conditions of this Agreement.
2. TERM. The term of this Agreement shall begin on Monday, November 1, 1999
and shall terminate on November 1, 2000.
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3. SERVICES.
(a) CONSULTANT shall act, generally, as financial public
relations counsel, essentially acting (1) as liaison between the COMPANY and is
database of approx. 60,000 retail buying stockbrokers; (2) as advisor to the
COMPANY with respect to existing and potential market makers, broker-dealers,
and investors as well as being the liaison between the COMPANY and such persons;
and (3) as advisor to the COMPANY with respect to communications and information
(e.g., interviews, press releases, financial media, etc.) As well as planning,
designing, developing, organizing, writing and distributing such communications
and information with the exception of Due Diligence Packages.
(b) CONSULTANT shall seek to make the COMPANY, its management,
its products, and its financial situation and prospects, known to the financial
press, publications and TV financial news programs, financial talk shows,
broker-dealers, institutional investors, market makers, investment advisors, and
other members of the financial community as well as the Internet financial media
and the public generally.
(c) CONSULTANT, in providing the foregoing services, shall be
responsible for all costs of providing the services.
4. LIMITATIONS ON SERVICES. The parties recognize that certain
responsibilities and obligations are imposed by federal and state securities
laws and by the applicable rules and regulations of stock exchanges, the
National Association of Securities Dealers, in-house "due diligence" or
"compliance" departments of brokerage houses, etc. Accordingly, CONSULTANT
agrees:
(a) CONSULTANT shall NOT release any financial or other information
or data about the COMPANY without the consent, approval and signature of the
COMPANY, signatures on press releases are necessary.
2
<PAGE>
(b) CONSULTANT shall NOT conduct any meetings with financial investors
without informing the COMPANY in advance of the proposed meeting and the format
or agenda of such meeting and the COMPANY may elect to have a representative of
the COMPANY attend at such meeting.
(c) CONSULTANT shall NOT release any information or data about the
COMPANY to any selected or limited person(s), entity, or group if CONSULTANT is
aware that such information or data has not been generally released or
promulgated.
(d) After notice by the COMPANY of filing for a proposed public
offering of securities of the COMPANY, and during any period of restriction on
publicity, CONSULTANT shall not engage in any public relations efforts not in
the normal course without approval of counsel for the COMPANY and of counsel for
the underwriter(s), if any.
5. DUTIES OF COMPANY
(a) COMPANY shall supply CONSULTANT, on a regular and timely basis with
all approved data and information about the COMPANY, its managements, its
products, and its operations and COMPANY shall be responsible for advising
CONSULTANT of any facts which would affect the accuracy of any prior data and
information previously supplied to CONSULTANT so that CONSULTANT may take
corrective action.
(b) COMPANY shall promptly supply CONSULTANT: with full and complete
copies of all findings with all federal and state securities agencies; with full
and complete copies of all shareholder reports and communications whether or not
prepared with CONSULTANT's assistance; with all data and information supplied to
any analyst, broker-dealer, market maker, or
3
<PAGE>
other member of the financial community; and with all product/services
brochures, sales materials, etc. (This is usually a due diligence package),
as/if information is needed.
(c) COMPANY shall promptly notify CONSULTANT of the filing of any
registration statement for the sale of securities and of any other event which
triggers any restrictions on publicity.
(d) COMPANY shall contemporaneously notify CONSULTANT if any
information or data being supplied to CONSULTANT has not been generally released
or promulgated. A signature on material will do - CONSULTANT does deliver
minimum disclosure.
6. REPRESENTATION AND INDEMNIFICATION
(a) The COMPANY shall be deemed to make a continuing representation of
the accuracy of any and all material facts, material, information, and data
which it supplies to CONSULTANT and the COMPANY acknowledges its awareness that
CONSULTANT will rely on such continuing representation in disseminating such
information and otherwise performing its public relations functions.
(b) CONSULTANT, in the absence of notice in writing from COMPANY, will
rely on the continuing accuracy of material, information, and data supplied by
the COMPANY.
(c) COMPANY hereby agrees to indemnify CONSULTANT against, and to hold
CONSULTANT harmless from, any claims, demands, suits, loss, damages, and etc.
arising out of CONSULTANTS reliance upon the accuracy and continuing accuracy of
such facts, material, information, and data.
4
<PAGE>
7. COMPENSATION.
(a) Joyce Research Group, Inc., in providing the foregoing services,
shall be responsible for all costs incurred except company will be responsible
for mailing of due diligence requests (or expenses for preparation and mailing
of due diligence packages by Joyce Research Group, Inc.).
(b) Four cost in expense fees will be as follows: $50,000 shares of
free-trading common stock or cash or a combination of both upon signing
contract. $50,000 shares of free trading common stock or cash or a combination
of both on 2nd contract month and $50,000 shares of free trading common stock or
cash or a combination of both 3rd contract month. Months 4, 5, and 6, will be
$25,000 shares of free-trading common stock or cash or a combination of both
paid each month plus an option contract will be put into place for the remaining
contract year.
8. BILLING AND PAYMENT. The monthly basic fee provided for in Paragraph
7(a) shall be due and payable without billing. Billings and payments for special
services (Paragraph 7) shall be as agreed.
9. RELATIONSHIP OF PARTIES. CONSULTANT is a Florida Corporation,
responsible for compensation of its agents, employees and representatives, as
well as all applicable withholding therefrom and taxes thereon (including
unemployment compensation) and all workman's compensation insurance. This
Agreement does not establish any partnership, joint venture, or other business
entity or association between the parties and neither party is intended to have
any interest in the business or property of the other.
10. TERMINATION. This agreement may be terminated by either party
prior to the expiration of the term provided in Paragraph 2 above only in
writing at least five business days prior to the expiration of current contract
month. If this should happen, Company is responsible for all expenses to that
date. All stock left in JRG's account upon any cancellation date, will be
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<PAGE>
returned to Company minus expenses to that date.
11. ATTORNEY'S FEES. Should either party default in the terms or
conditions of this Agreement and suit be filed as a result of such default, the
prevailing party shall be entitled to recover all costs incurred as a result of
such default including all costs and reasonable attorney's fees, expenses and
court costs through trial and appeal.
12. WAIVER OF BREACH. The waiver by either party of a breach of any
provision of this Agreement by the other party shall not operate or be construed
as a waiver of any subsequent breach by the other party.
13. ASSIGNMENT. The rights and obligations of the parties under this
Agreement shall inure to the benefit of, and shall be binding upon, the
successors and assigns of the parties.
14. NOTICES. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing, and if sent by certified mail,
return receipt requested, to the principal office of the party being notified.
15. ENTIRE AGREEMENT. This instrument contains the entire agreement of
the parties and may be modified only by agreement in writing, signed by the
party against whom enforcement of any waiver, change, modification, extension or
discharge is sought. This Agreement shall be governed for all purposes by the
laws of the State of Florida. If any provision of this Agreement is declared
void, such provision shall be deemed severed from this Agreement, which shall
otherwise remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound,
have executed this Agreement.
6
<PAGE>
JOYCE RESEARCH GROUP, INC.
by: /s/Terry Joyce Ritchie Date: 11/1/99
Terry Joyce Ritchie, President/CEO
Joyce Research Group, Inc.
by: /s/Carol Neal Date: 11/1/99
Carol Neal, President/CEO
Platinum & Gold Publishing & Recording Corp.
7
EXHIBIT 10.13
CONSULTING AGREEMENT
AGREEMENT MADE this 5 day of November, 1999, by and between Elyse R. Doss
whose mailing address is 9755 Hightower Road, Roswell, GA 30075 (herein referred
to as "ERD"), and Platinum & Gold, Inc., a Nevada corporation with its principal
office and place of business located at 12724 N.W. 11 Court, Sunrise, Florida,
33323 (hereinafter referred to as "P&G ").
WHEREAS, P&G is engaged in the business of providing alternative
entertainment solutions; and
WHEREAS, P&G is desirous of utilizing ERD's services as a consultant with
respect to finance solutions, accounting, and business services;
NOW THEREFORE, in consideration of the mutual promises herein contained and
other good and valuable consideration, the receipt and sufficiency of which
being hereby acknowledged, the parties do hereby agree as follows:
1. Retention as Consultant
A. ERD shall act as consultant to P&G. In such capacity, to
the extent deemed reasonable by mutual agreement of ERD and P&G, and at the
reasonable convenience of ERD, ERD shall provide services and consultation on
matters connected with the Business, including, but not limited to, various
verbal or written advice on business and finance issues of P&G, attendance at
meetings, interviews, or other scheduled events at P&G's corporate offices or
other locations; guidance and advice on contracts and events leading up to
publicly trading of P&G 's stock and other mutually-agreeable duties or
functions. The services to be performed in connection with this agreement are
not in connection with the offer or sale of securities in a capital-raising
transaction, and ERD will not directly or indirectly promote or maintain a
market for the Company's securities. No more than fifty (50) hours of consulting
services shall be scheduled in any seven (7) day period unless mutually agreed
to by the parties. It is expressly understood and agreed that ERD, or any of its
employees, shall not be an employee of P&G. ERD shall provide up to 1,000 hours
of consulting under this Agreement for each week of time beginning upon the
execution of this Agreement.
B. Any requests for ERD's services shall be made solely by
Carol Neal, the designated representative of P&G.
C. All consulting time of ERD shall be rounded to the nearest
one-quarter hour of consulting. For example, a one hour fifty minute meeting
shall be deemed to be two (2) consulting hours under this Agreement. A
consulting request for ERD to be at a meeting at P&G's corporate offices or any
other location shall be counted as three (3) hours or the actual time spent,
whichever is greater.
D. ERD shall provide a monthly report to P&G which summarizes
all consulting activity performed by ERD in the previous 30 days, as well as a
total of all consulting hours performed to date.
2. Practice by Consultant.
Consulting Agreement
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Except as provided herein, nothing in this Agreement shall prevent ERD
or its principals from (a) providing consulting services to any person,
individuals, partnerships, corporations or other entities; (b) becoming an
employee, officer or director of another person, individual, partnership,
corporation, or other entity.
3. Compensation.
A. As consideration for the services hereunder, P&G shall pay to
ERD, within five (5) business days of P&G 's 100% acceptance, the
sum indicated by the milestones indicated below:
- Upon execution of this consulting agreement, 200,000 shares
of P&G, Inc. common stock pursuant to rule 701 of the
Security Act of 1933 will be transferred into Elyse R. Doss
name.
- Completion of Reverse Merger $0
- Completion of Business Plan - $0
- Completion of Company Audit - $0
- Completion of Offering Memorandum and Subscription Agreement
- $0
- Preparation of Investor Package - $0
- Completion of Investor Schedule and Milestone Chart for
Public Trading - $0
- Development of File System fo Managing Stock Certificates
and Communications with shareholders - $20,000
- Submission of 15-C-211 to Market Maker - $0
- Approval From NASDAQ to begin Trading - $0
1. The above mentioned prices do not include approved expenses, for
the months of November 1999 through October 2000. All payments
are due within 5 business days of submission of proof o meeting
the stated milestones or withi 20 business days for approved
expenses which were submitted by ERD to P&G for reimbursement.
C. All payments due ERD hereunder shall b made regardless of the
number of hours of consulting performed by ERD. After the total
of 1,000 hours has been performed, P&G may contract for up to 500
additional hours with ERD at the rate of $100.00 per hour.
D. P&G shall have the option of pre-payin any and all amounts due
hereunder.
4. Duration and Termination.
As to ERD's obligations to perform to milestones or hours hereunder,
ERD shall be obligated to perform services hereunder until ERD has performed a
total 1,000 hours of consulting or until November 2000, which ever first occurs.
The terms of this Agreement shall be for one (1) year beginning upon the first
day of the month which this Agreement was executed. Either party may cancel this
Agreement with thirty (30) days notice at any time but P&G shall be responsible
for payment to ERD of any milestone payments due as a result of services
provided and proof demonstrated of those services by ERD.
This Agreement is renewable upon the mutual written consent of both parties
within thirty (30) days from the termination date of November 4, 2000. Prior to
the renewal of this Agreement pursuant to the
Consulting Agreement
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<PAGE>
preceding paragraph, the total of consulting hours under this Agreement shall be
renegotiated for the next renewal term.
5. Arbitration of Disputes.
All disputes, claims, and questions regarding the rights and
obligations of the parties under the terms of this Agreement shall first be
submitted to mediation. In the event the mediation is unable to resolve such
dispute(s), then either party may make a demand for arbitration by filing such
demand in writing with the other party within thirty (30) days after the dispute
first arises. Thereafter, arbitration shall be conducted by three arbitrators,
sitting in Palm Beach, Florida, and acting under the rules of the American
Arbitration Association.
INITIALS OF PARTIES ACKNOWLEDGING THIS CLAUSE NO. 5: /s/ CN /s/ ERD
6. Confidentiality.
In further consideration of the payment of the aforesaid sum, the
parties do hereby agree that for a period of thirty (30) months from the date of
this Agreement all accounting information, client data, letters, documents, and
all other materials, whether written or oral, and in all other tangible or
intangible forms, relating to the Business; all technical, financial, legal or
business information related to any of the parties involved in the Business
herein; and all other aspects of the Business, all of which of the above being
deemed to be confidential and proprietary information, are and shall remain
confidential and shall not be disclosed to anyone except as may be required for
disclosure to governmental agencies, compliance with any directives of any
Courts, and reporting on any income tax return.
7. Default.
No party shall be in default under this Agreement, until written
notification of a claimed default is received by the perceived defaulting party
and such stated default is not cured within 30 days notice to the defaulting
party.
8. Entire Agreement.
This Agreement shall constitute the entire agreement between the
parties hereto and any prior understanding or representation of any kind
preceding the date of this Agreement shall not be binding by either party except
to the extent incorporated in this Agreement.
9. Modification of Agreement.
Any modification of this Agreement or additional obligation assumed by
either party in connection with this Agreement shall be binding only if
evidenced in writing signed by each party hereto or by an authorized
representative of each party hereto.
10. Notices.
Consulting Agreement
3
<PAGE>
Any notice provided for or concerning this Agreement shall be in
writing and be deemed sufficiently given once sent by certified or registered
mail return receipt requested if sent to the respective address of each such
party who is to receive notice, and shall be directed as follows:
TO ERD: Elyse R. Doss
9755 Hightower Road
Roswell, GA 30075
TO P&G: Platinum & Gold, Inc.
ATTN: Carol Neal
12724 N.W. 11 Court
Sunrise, Florida 33323
11. Governing Law.
It is agreed that this Agreement shall be governed by, construed, and
enforced in accordance with the laws of the State of Florida.
12. Effect of Partial Invalidity.
The invalidity of any portion of this Agreement will not and shall not
be deemed to affect the validity of any other provision. In the event that any
provision of this Agreement is held to be invalid, the parties hereto agree that
the remaining provisions shall be deemed in full force and effect as if they had
been executed by both parties subsequent to the deletion of the invalid
provision.
13. Assignment of Duties to Related Corporations of P&G.
The parties acknowledge and agree that the obligations of ERD hereunder
may be performed for P&G, or such other related corporations as may be directed
by P&G.
Consulting Agreement
4
<PAGE>
IN WITNESS WHEREOF, each party to this Agreement has caused it to be
executed on the date first written above with intent to be legally bound.
ELYSE R. DOSS
By: /s/ Elyse Doss
--------------------
Title: Consultant
ATTEST:
/s/ Louise Cavell
Corporate Secretary
[Affix Seal Here]
PLATINUM & GOLD, INC.
By: /s/ Carol Neal
--------------------
Title: President, CEO
Consulting Agreement
5
EXHIBIT 10.14
CONSULTING AGREEMENT
AGREEMENT MADE this 7 day of December, 1999, by and between Mark F. Jordan
whose mailing address is 5415 Shakespear Drive, Dover, FL 33527 (herein referred
to as "MFJ"), and Platinum & Gold, Inc., a Nevada corporation with its principal
office and place of business located at 12724 N.W. 11 Court, Sunrise, Florida,
33323 (hereinafter referred to as "P&G ").
WHEREAS, P&G is engaged in the business of providing alternative
entertainment solutions; and
WHEREAS, P&G is desirous of utilizing MFJ's services as a consultant
with respect to finance solutions, accounting, and business services;
NOW THEREFORE, in consideration of the mutual promises herein contained and
other good and valuable consideration, the receipt and sufficiency of which
being hereby acknowledged, the parties do hereby agree as follows:
1. Retention as Consultant
A. MFJ shall act as consultant to P&G. In such capacity, to
the extent deemed reasonable by mutual agreement of MFJ and P&G, and at the
reasonable convenience of MFJ, MFJ shall provide services and consultation on
matters connected with the Business, including, but not limited to, various
verbal or written advice on business and finance issues of P&G, attendance at
meetings, interviews, or other scheduled events at P&G's corporate offices or
other locations; guidance and advice on contracts and events leading up to
publicly trading of P&G 's stock and other mutually-agreeable duties or
functions. The services to be performed in connection with this agreement are
not in connection with the offer or sale of securities in a capital-raising
transaction, and MFJ will not directly or indirectly promote or maintain a
market for the Company's securities. No more than fifty (50) hours of consulting
services shall be scheduled in any seven (7) day period unless mutually agreed
to by the parties. It is expressly understood and agreed that MFJ, or any of its
employees, shall not be an employee of P&G. MFJ shall provide up to 1,000 hours
of consulting under this Agreement for each week of time beginning upon the
execution of this Agreement.
B. Any requests for MFJ's services shall be made solely
by Carol Neal, the designated representative of P&G.
C. All consulting time of MFJ shall be rounded to the nearest
one-quarter hour of consulting. For example, a one hour fifty minute meeting
shall be deemed to be two (2) consulting hours under this Agreement. A
consulting request for MFJ to be at a meeting at P&G's corporate offices or any
other location shall be counted as three (3) hours or the actual time spent,
whichever is greater.
D. MFJ shall provide a monthly report to P&G which summarizes
all consulting activity performed by MFJ in the previous 30 days, as well as a
total of all consulting hours performed to date.
2. Practice by Consultant.
Except as provided herein, nothing in this Agreement shall prevent MFJ
or its principals from (a) providing consulting services to any person,
individuals, partnerships, corporations or other entities; (b)
Consulting Agreement
1
<PAGE>
becoming an employee, officer or director of another person, individual,
partnership, corporation, or other entity.
3. Compensation.
A. As consideration for the services hereunder, P&G shall pay
to MFJ, within five (5) business days of P&G 's 100%
acceptance, the sum indicated by the milestones indicated
below:
- Upon execution of this consulting agreement, 300,000
shares of P&G, Inc. common stock pursuant to rule 701 of the
Security Act of 1933 will be transferred into Mark F.
Jordan's name.
1. The above mentioned prices do not include approved expenses,
for the months of December 1999 through November 2000 All
payments are due within 5 business days of submission of
proof o meeting the stated milestones or withi 20 business
days for approved expenses which were submitted by MFJ to
P&G for reimbursement.
C. All payments due MFJ hereunder shall be made regardless of
the number of hours of consulting performed by MFJ. After
the total of 1,000 hours has been performed, P&G may
contract for up to 500 additional hours with MFJ at the rate
of $100.00 per hour.
D. P&G shall have the option of pre-payin any and all amounts
due hereunder.
4. Duration and Termination.
As to MFJ's obligations to perform to milestones or hours hereunder,
MFJ shall be obligated to perform services hereunder until MFJ has performed a
total 1,000 hours of consulting or until December 2000, which ever first occurs.
The terms of this Agreement shall be for one (1) year beginning upon the first
day of the month which this Agreement was executed. Either party may cancel this
Agreement with thirty (30) days notice at any time but P&G shall be responsible
for payment to MFJ of any milestone payments due as a result of services
provided and proof demonstrated of those services by MFJ.
This Agreement is renewable upon the mutual written consent of both parties
within thirty (30) days from the termination date of December 2000. Prior to the
renewal of this Agreement pursuant to the preceding paragraph, the total of
consulting hours under this Agreement shall be renegotiated for the next renewal
term.
5. Arbitration of Disputes.
All disputes, claims, and questions regarding the rights and
obligations of the parties under the terms of this Agreement shall first be
submitted to mediation. In the event the mediation is unable to resolve such
dispute(s), then either party may make a demand for arbitration by filing such
demand in writing with the other party within thirty (30) days after the dispute
first arises. Thereafter, arbitration shall be conducted by three arbitrators,
sitting in Palm Beach, Florida, and acting under the rules of the American
Arbitration Association.
INITIALS OF PARTIES ACKNOWLEDGING THIS CLAUSE NO. 5: /s/MFJ /s/ CN
--------- ------
Consulting Agreement
2
<PAGE>
6. Confidentiality.
In further consideration of the payment of the aforesaid sum, the
parties do hereby agree that for a period of thirty (30) months from the date of
this Agreement all accounting information, client data, letters, documents, and
all other materials, whether written or oral, and in all other tangible or
intangible forms, relating to the Business; all technical, financial, legal or
business information related to any of the parties involved in the Business
herein; and all other aspects of the Business, all of which of the above being
deemed to be confidential and proprietary information, are and shall remain
confidential and shall not be disclosed to anyone except as may be required for
disclosure to governmental agencies, compliance with any directives of any
Courts, and reporting on any income tax return.
7. Default.
No party shall be in default under this Agreement, until written
notification of a claimed default is received by the perceived defaulting party
and such stated default is not cured within 30 days notice to the defaulting
party.
8. Entire Agreement.
This Agreement shall constitute the entire agreement between the
parties hereto and any prior understanding or representation of any kind
preceding the date of this Agreement shall not be binding by either party except
to the extent incorporated in this Agreement.
9. Modification of Agreement.
Any modification of this Agreement or additional obligation assumed by
either party in connection with this Agreement shall be binding only if
evidenced in writing signed by each party hereto or by an authorized
representative of each party hereto.
10. Notices.
Any notice provided for or concerning this Agreement shall be in
writing and be deemed sufficiently given once sent by certified or registered
mail return receipt requested if sent to the respective address of each such
party who is to receive notice, and shall be directed as follows:
TO MFJ: Mark F. Jordan
5415 Shakespear Drive
Dover, FL 33527
TO P&G: Platinum & Gold, Inc.
ATTN: Carol Neal
12724 N.W. 11 Court
Sunrise, Florida 33323
Consulting Agreement
3
<PAGE>
11. Governing Law.
It is agreed that this Agreement shall be governed by, construed, and
enforced in accordance with the laws of the State of Florida.
12. Effect of Partial Invalidity.
The invalidity of any portion of this Agreement will not and shall not
be deemed to affect the validity of any other provision. In the event that any
provision of this Agreement is held to be invalid, the parties hereto agree that
the remaining provisions shall be deemed in full force and effect as if they had
been executed by both parties subsequent to the deletion of the invalid
provision.
13. Assignment of Duties to Related Corporations of P&G.
The parties acknowledge and agree that the obligations of MFJ hereunder
may be performed for P&G, or such other related corporations as may be directed
by P&G.
Consulting Agreement
4
<PAGE>
IN WITNESS WHEREOF, each party to this Agreement has caused it to be
executed on the date first written above with intent to be legally bound.
MARK F. JORDAN
By: /s/ Mark F. Jordan
-----------------------
Title: Owner
ATTEST:
/s/ David Osborne /s/ Louise Cavell
- ----------------- -----------------
Corporate Secretary
[Affix Seal Here]
PLATINUM & GOLD, INC.
By: /s/ Carol Neal
--------------------
Title: President, CEO
Consulting Agreement
5
EXHIBIT 10.15
CONSULTING AGREEMENT
AGREEMENT MADE this 7 day of December, 1999, by and between David C.
Osborne whose mailing address is 2003 W. Sandalwood Drive, N., Plant City, FL
33566 (herein referred to as "DCO"), and Platinum & Gold, Inc., a Nevada
corporation with its principal office and place of business located at 12724
N.W. 11 Court, Sunrise, Florida, 33323 (hereinafter referred to as "P&G ").
WHEREAS, P&G is engaged in the business of providing alternative
entertainment solutions; and
WHEREAS, P&G is desirous of utilizing DCO's services as a consultant with
respect to finance solutions, accounting, and business services;
NOW THEREFORE, in consideration of the mutual promises herein contained and
other good and valuable consideration, the receipt and sufficiency of which
being hereby acknowledged, the parties do hereby agree as follows:
1. Retention as Consultant
A. DCO shall act as consultant to P&G. In such capacity, to
the extent deemed reasonable by mutual agreement of DCO and P&G, and at the
reasonable convenience of DCO, DCO shall provide services and consultation on
matters connected with the Business, including, but not limited to, various
verbal or written advice on business and finance issues of P&G, attendance at
meetings, interviews, or other scheduled events at P&G's corporate offices or
other locations; guidance and advice on contracts and events leading up to
publicly trading of P&G 's stock and other mutually-agreeable duties or
functions. The services to be performed in connection with this agreement are
not in connection with the offer or sale of securities in a capital-raising
transaction, and DCO will not directly or indirectly promote or maintain a
market for the Company's securities. No more than fifty (50) hours of consulting
services shall be scheduled in any seven (7) day period unless mutually agreed
to by the parties. It is expressly understood and agreed that DCO, or any of its
employees, shall not be an employee of P&G. DCO shall provide up to 1,000 hours
of consulting under this Agreement for each week of time beginning upon the
execution of this Agreement.
B. Any requests for DCO's services shall be made solely
by Carol Neal, the designated representative of P&G.
C. All consulting time of DCO shall be rounded to the nearest
one-quarter hour of consulting. For example, a one hour fifty minute meeting
shall be deemed to be two (2) consulting hours under this Agreement. A
consulting request for DCO to be at a meeting at P&G's corporate offices or any
other location shall be counted as three (3) hours or the actual time spent,
whichever is greater.
D. DCO shall provide a monthly report to P&G which summarizes
all consulting activity performed by DCO in the previous 30 days, as well as a
total of all consulting hours performed to date.
2. Practice by Consultant.
Except as provided herein, nothing in this Agreement shall prevent DCO
or its principals from (a) providing consulting services to any person,
individuals, partnerships, corporations or other entities;
Consulting Agreement
1
<PAGE>
(b) becoming an employee, officer or director of another person, individual,
partnership, corporation, or other entity.
3. Compensation.
A. As consideration for the services hereunder, P&G shall pay
to DCO, within five (5) business days of P&G 's 100%
acceptance, the sum indicated by the milestones indicated
below:
- Upon execution of this consulting agreement, 300,000
shares of P&G, Inc. common stock pursuant to rule 701
of the Security Act of 1933 will be transferred into
David C. Osborne's name.
1. The above mentioned prices do not include approved expenses,
for the months of December 1999 through November 2000 All
payments are due within 5 business days of submission of
proof o meeting the stated milestones or withi 20 business
days for approved expenses which were submitted by DCO to
P&G for reimbursement.
C. All payments due DCO hereunder shall b made regardless of
the number of hours of consulting performed by DCO. After
the total of 1,000 hours has been performed, P&G may
contract for up to 500 additional hours with DCO at the rate
of $100.00 per hour.
D. P&G shall have the option of pre-payin any and all amounts
due hereunder.
4. Duration and Termination.
As to DCO's obligations to perform to milestones or hours hereunder,
DCO shall be obligated to perform services hereunder until DCO has performed a
total 1,000 hours of consulting or until December 2000, which ever first occurs.
The terms of this Agreement shall be for one (1) year beginning upon the first
day of the month which this Agreement was executed. Either party may cancel this
Agreement with thirty (30) days notice at any time but P&G shall be responsible
for payment to DCO of any milestone payments due as a result of services
provided and proof demonstrated of those services by DCO.
This Agreement is renewable upon the mutual written consent of both parties
within thirty (30) days from the termination date of December 2000. Prior to the
renewal of this Agreement pursuant to the preceding paragraph, the total of
consulting hours under this Agreement shall be renegotiated for the next renewal
term.
5. Arbitration of Disputes.
All disputes, claims, and questions regarding the rights and
obligations of the parties under the terms of this Agreement shall first be
submitted to mediation. In the event the mediation is unable to resolve such
dispute(s), then either party may make a demand for arbitration by filing such
demand in writing with the other party within thirty (30) days after the dispute
first arises. Thereafter, arbitration shall be conducted by three arbitrators,
sitting in Palm Beach, Florida, and acting under the rules of the American
Arbitration Association.
INITIALS OF PARTIES ACKNOWLEDGING THIS CLAUSE NO. 5: /s/ DO /s/ CN
------- ------
Consulting Agreement
2
<PAGE>
6. Confidentiality.
In further consideration of the payment of the aforesaid sum, the
parties do hereby agree that for a period of thirty (30) months from the date of
this Agreement all accounting information, client data, letters, documents, and
all other materials, whether written or oral, and in all other tangible or
intangible forms, relating to the Business; all technical, financial, legal or
business information related to any of the parties involved in the Business
herein; and all other aspects of the Business, all of which of the above being
deemed to be confidential and proprietary information, are and shall remain
confidential and shall not be disclosed to anyone except as may be required for
disclosure to governmental agencies, compliance with any directives of any
Courts, and reporting on any income tax return.
7. Default.
No party shall be in default under this Agreement, until written
notification of a claimed default is received by the perceived defaulting party
and such stated default is not cured within 30 days notice to the defaulting
party.
8. Entire Agreement.
This Agreement shall constitute the entire agreement between the
parties hereto and any prior understanding or representation of any kind
preceding the date of this Agreement shall not be binding by either party except
to the extent incorporated in this Agreement.
9. Modification of Agreement.
Any modification of this Agreement or additional obligation assumed by
either party in connection with this Agreement shall be binding only if
evidenced in writing signed by each party hereto or by an authorized
representative of each party hereto.
10. Notices.
Any notice provided for or concerning this Agreement shall be in
writing and be deemed sufficiently given once sent by certified or registered
mail return receipt requested if sent to the respective address of each such
party who is to receive notice, and shall be directed as follows:
TO DCO: David C. Osborne
2003 W. Sandalwood Drive, N.
Plant City, FL 33566
TO P&G: Platinum & Gold, Inc.
ATTN: Carol Neal
12724 N.W. 11 Court
Sunrise, Florida 33323
Consulting Agreement
3
<PAGE>
11. Governing Law.
It is agreed that this Agreement shall be governed by, construed, and
enforced in accordance with the laws of the State of Florida.
12. Effect of Partial Invalidity.
The invalidity of any portion of this Agreement will not and shall not
be deemed to affect the validity of any other provision. In the event that any
provision of this Agreement is held to be invalid, the parties hereto agree that
the remaining provisions shall be deemed in full force and effect as if they had
been executed by both parties subsequent to the deletion of the invalid
provision.
13. Assignment of Duties to Related Corporations of P&G.
The parties acknowledge and agree that the obligations of DCO hereunder
may be performed for P&G, or such other related corporations as may be directed
by P&G.
Consulting Agreement
4
<PAGE>
IN WITNESS WHEREOF, each party to this Agreement has caused it to be
executed on the date first written above with intent to be legally bound.
DAVID C. OSBORNE
By: /s/ David C. Osborne
----------------------
Title: Owner
ATTEST:
/s/ Mark F. Jordan /s/ Louise Cavell
- ------------------ -----------------
Corporate Secretary
[Affix Seal Here]
PLATINUM & GOLD, INC.
By: /s/ Carol Neal
------------------
Title: President, CEO
Consulting Agreement
5
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001081084
<NAME> Platinum and Gold, Inc.
<MULTIPLIER> 1
<CURRENCY> U.S. Currency
<S> <C>
<PERIOD-TYPE> 12-mos
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-START> Jan-01-1999
<PERIOD-END> Dec-31-1999
<EXCHANGE-RATE> 1
<CASH> 98,329
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 98,329
<PP&E> 4,321
<DEPRECIATION> 739
<TOTAL-ASSETS> 134,996
<CURRENT-LIABILITIES> 131,757
<BONDS> 0
0
0
<COMMON> 12,431
<OTHER-SE> (217,350)
<TOTAL-LIABILITY-AND-EQUITY> 134,996
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 206,399
<OTHER-EXPENSES> 10,073
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 437
<INCOME-PRETAX> (216,909)
<INCOME-TAX> 0
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<CHANGES> 0
<NET-INCOME> (216,909)
<EPS-BASIC> (.018)
<EPS-DILUTED> (.018)
</TABLE>
