U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL BUSINESS ISSUERS UNDER
SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
CostPlusFive.com, Inc.
(Name of Small Business Issuer in its charter)
Nevada 86-0853156
- ---------------------------------- -----------------------------
(State or other jurisdiction of I.R.S. Employer
incorporation or organization) Identification No.)
79811A Country Club Dr.
Bermuda Dunes, CA 92201
- ---------------------------------- -----------------------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code 760-345-2400
- ---------------------------------- -----------------------------
Securities to be registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class
is to be registered
None N/A
- ---------------------------------- -----------------------------
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock, $.001 par value
- -----------------------------------------------------------------------------
(Title of class)
Item 1. Description of Business
Business Development
The Company was incorporated in the State of Nevada on January 15, 1997, under
the original name of Stop-N-Sock, Ltd. Its predecessor entity, Stock-N-Sock
"SEED", was a California Limited Partnership formed in 1996 to develop a high-
tech driving range. Up until March 1, 1999, the Company was engaged in the
business of development of its Coachella Valley real estate into a driving
range. On March 1, 1999, the Company changed its name to CostPlusFive.com,
Inc. and changed its business to a wholesale buying club, specializing in the
sale of high quality, leading edge multimedia computer systems and peripherals
via the Internet.
In General
The Company is in the business of sales of high quality, leading edge
multimedia computer systems and peripherals through its web site on the
Internet, supported by affiliated retail locations in Texas, Arizona and
Maryland. The Company sells its products at five percent over wholesale price
for its membership. Members pay $39.95 per family or $139.95 per business per
year to receive these discounts on all products the company sells.
The Industry
Retail sales in computer hardware products is a relatively new industry, which
is in a constant state of change, due to the advance in microchip technology,
which results in the development of more diversified and technologically
advanced hardware. Internet sales of computer products is a more recent
development. Both of these industries are highly competitive. The Company's
unique niche in this industry is the fact that the Company offers a
membership, which stimulates customer loyalty. The benefits of membership are
that the member receives a price on Company offered products of five percent
above the wholesale price paid by the Company. A further advantage is that
the Company maintains affiliated (not owned) retail locations in Phoenix,
Arizona, Tucson, Arizona, Bedford, Texas, and Rockville, Maryland, where a
customer can go for after market support and repairs.
Discontinued Business
The Company was formerly known as Stop-N-Sock, Inc. The Company owns a site
in the Coachella Valley on Miles Avenue between Washington Boulevard near to
Highway 111 in Indian Wells. Management had plans to erect a state of the
art, high-tech golf practice range and teaching facility plus full pro shop,
to feature 60 driving range stations having climate compensating
misters/heaters, full lighting for night usage, automatic ball spotters, and
computer aided video swing analysis. However, the Company determined that it
would be in the best interests of the Company and its shareholders to abandon
the project and to sell the site, due to the fact that management determined
that the Company could not likely raise the capital required to develop the
site to its full potential. The Company then put in a new management team and
shifted its focus to Internet sales of computer products.
Products
The Company offers a full line of fully customer configurable multimedia
computer systems, printers, notebook computers, monitors and scanners,
computer cables and related hardware, computer software and games.
Marketing
The Company will vigorously promote memberships in its "CostPlusFive.com
Buying Club," which will enable members to purchase computers, peripherals and
software at five percent over Company cost. The Company will seek to foster
long term relationships and word of mouth referrals through customer service.
The Company maintains a full time customer service toll free telephone number,
and service maintenance at its affiliated retail locations. The Company has
no ownership interest in the retail locations, which are owned by the officers
and directors of the Company, and which bear the Company name by Company
consent.
The Company will seek to expand its locations through the use of approximately
100 square foot retail kiosks strategically placed in existing businesses and
shopping centers. The kiosks will offer sales of memberships in the Company's
wholesale buying club, sales of all computer products offered by the Company,
and service. Operators of retail locations will split 50% of gross profits
from all sales and services.
Patents
The Company holds no patents for its products.
Raw Materials and Principal Suppliers and Vendors
The Company does not manufacture its products and, therefore, does not utilize
raw materials. The Company's products and its suppliers are as follows:
Computer Systems, Printers, and peripherals: Total peripherals, Richardson, TX
Computer Systems, Printers and Peripherals: Parts 2PC, Pasadena, CA
Computer Systems, Printers and Peripherals: Comtech Digital Systems,
Glendale,CA
Computer cables and related hardware: Cables Unlimited, Concord, CA
Computer software and games: HC Distributors, Pflugerville, TX
Competition
The business of providing wholesale and retail computer sales is one of
intense competition. Other companies with more affiliate or retail locations
than the Company have financial resources superior to the Company, so there
can be no assurance that the Company's projected income will not be affected
by its competition. There are also many other companies with greater financial
resources that the Company who offer computer sales on the Internet. However,
the Company feels it is able to compete adequately with these other companies,
due to its unique pricing of product at 5% above cost. However, there can be
no assurance that competing companies with greater buying power will be able
to undercut the Company's pricing structure.
Employees
The Company's only employees are its four officers and directors.
Item 2. Management's Discussion and Analysis of Plan of Operations
Plan of Operations
The Company is engaged in the business of sales of high quality, leading edge
multimedia computer systems and peripherals through its web site on the
Internet, supported by affiliated retail locations in Texas, Arizona and
Maryland. The Company sells its products at five percent over wholesale price
for its membership. Members pay $39.95 per family or $139.95 per business per
year to receive these discounts on all products the company sells. The Company
has financed its operations to date through the sale of its securities. See
Item 10 - "Recent Sales of Unregistered Securities."
The Company's plan of operations over the next 12 months includes implementing
its marketing plan by vigorously promoting memberships in its CostPlusFive.com
Buying Club," which will enable members to purchase computers, peripherals and
software at five percent over Company cost. The Company will seek to foster
long term relationships and word of mouth referrals through customer service
and its affiliated locations, and will seek to expand the number of affiliated
locations through the use of approximately 100 square foot retail kiosks
strategically placed in existing businesses and shopping centers. The kiosks
will offer sales of memberships in the Company's wholesale buying club, sales
of all computer products offered by the Company, and service. Operators of
retail locations will split 50% of gross profits from all sales and services.
Forward Looking Statements
This registration statement contains forward-looking statements. The
Company's expectation of results and other forward-looking statements
contained in this registration statement involve a number of risks and
uncertainties. Among the factors that could cause actual results to differ
materially from those expected are the following: business conditions and
general economic conditions; competitive factors, such as pricing and
marketing efforts; and the pace and success of product research and
development. These and other factors may cause expectations to differ.
Year 2000 Compliance
With respect to Year 2000 compliance, the Company has performed an audit of
all of its computer hardware, internal accounting and software applications
and found all to be Year 2000 compliant or capable. As of this date, the
Company has been given assurances from its banking institution and transfer
agent that they are working toward compliance or are in compliance. In the
beginning of the second quarter of 1999, the Company shall conduct an audit of
its vendors and suppliers to identify relevant Year 2000 issues. At this
time, the Company cannot give a reasonable estimate of the costs associated
with Year 2000 compliance, due to an absence of data from its vendors and
suppliers, nor can assurances be offered with respect to third party
compliance. Upon assessment of the answers generated by the Company's Year
2000 questionnaires, a more realistic picture of the scope and impact of the
Year 2000 compliance challenges, if any, should allow sufficient time for
appropriate remediation without significant effect on the Company's business,
financial condition or results of operation.
Item 3. Description of Property
The Company leases executive offices on a month to month basis from its former
president, Robert T. Yarbray. It owns no other property, other than its
website name and trade name. The Company has no ownership interest in the
retail locations, which are owned by the officers and directors of the
Company, and which bear the Company name by Company consent.
Item 4. Securities Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding the beneficial
ownership of the shares of Common Stock of the Company as of the end of the
fiscal year, 1998, by (I) each person who is known by the Company to be the
beneficial owner of more than five percent (5%) of the issued and outstanding
shares of common stock, (ii) each of the Company's directors and executive
officers, and (iii) all directors and executive officers as a group.
<TABLE>
<CAPTION>
Name and Address Number of Shares Percentage Owned
- ---------------- ---------------- ----------------
<S> <C> <C>
Mahlon J. Meier 500,000 2.5%
Don Smallman 500,000 2.5%
Franklin R. Scivally 500,000 2.5%
William J. Barker 500,000 2.5%
Officers and Directors
as a Group 2,000,000 9.9%
- ----------
</TABLE>
Item 5. Directors, Executive Officers, Promoters and Control Persons
The Executive Officers of the Company, and their ages, are as follows:
Name Age Position
- ---- --- --------
Mahlon J. Meier 47 President, Chairman, C.E.O.
Donald R. Smallman 37 Secretary, Director
Franklin R. Scivally 47 Treasurer, Director
William Barker 37 Director
Mahlon J. Meier. Mr. Meier is the President and Director of the Company, and
has been since March 1, 1999. Mr. Meier has been the owner of Meier Treats,
Inc. in Grapevine, Texas since April, 1996. Mr. Meier is also the owner of
the CostPlusFive.com affiliated location in Bedford, Texas. He organized and
managed a software franchise called Cyber Exchange from September 9, 1996 to
the present. From July, 1995 to the present, he has managed a successful
retail gift business. He was formerly employed at GTE Telephone Operations in
Irving, Texas, from March, 1971 through April, 1996, as Director of
Operational Evaluation and Control from April 1992 through April 1997, Staff
Manager Quality from June, 1989 through April, 1992, manager Distribution
Center from January 1988 through June, 1989, and held various other positions
with GTE. He holds an M.S.B.A. from Illinois Western University.
Don Smallman. Mr. Smallman is the Secretary and Director of the Company, and
has been since March 1, 1999. He is also the owner of the CostPlusFive.com
affiliated locations in Phoenix, Arizona. Mr. Smallman was the owner of the
Cyber Exchange software and hardware franchise in Phoenix, Arizona. From
April 1996 through June, 1997, he was employed by CDI in Phoenix, Arizona as a
software engineer,/developer. From December, 1994 through February, 1996, he
was employed by First Approach - Entergy - River Bend Nuclear Generating
Station, in St. Francisville, Louisiana as a software engineer/developer, and
from March, 1994 through November, 1994, he was employed by Atlantic Group,
Inc. Arizona Public Service Palo Verde Nuclear Generating Station in Phoenix,
Arizona, in various positions, including I&C Procurement Engineer, Electrical
Engineer, and I&C Engineer. He was previously employed by Bechtel Power
Corporation from May, 1991 through November, 1993 at the Palo Verde Nuclear
Generating Station in Phoenix, Arizona, and from August, 1990 through April,
1991, he served as Electrical Engineer for Advanced Technology, Inc. At the
Tennessee Valley Authority Watts Bar Nuclear Plant in Chattanooga, Tennessee.
From October, 1989 through August, 1990, he was employed by Black & Veatch as
an Electrical/I&C Design Engineer at the Palo Verde Nuclear Generating
Station, and from September, 1982 through October, 1989, he was employed as an
Electrical/I&C Engineer at the Tennessee Valley Authority Sequotah Nuclear
Plant in Chattanooga, Tennessee.
Franklin R. Scivally. Mr. Scivally is the Treasurer and Director of the
Company. He is also the owner of the CostPlusFive.com affiliated location in
Tucson, Arizona. He is also the President of Scivally Enterprises, LLC. From
January, 1992 through December, 1997 he was employed by Questech, Inc. as
Project Manager. From November, 1971 through December, 1971 he was a
Commissioned Officer in the United States Air Force, in various positions,
including Chief, Quality Assurance Division of the Tomahawk Cruise Missile
Wing, Maintenance Control Officer, Minuteman & Ground, launch Cruise Missile
Launch Officer, Minuteman Weapon System Launch Analyst, Chief, Maintenance
Control, assignment through the Air Force Institute of Technology to Hughes
Aircraft Company, and Manufacturing Manager for the MILSTAR program. He holds
a Master of Arts/management & Supervision from Central Michigan University,
1983, a Bachelor of Science/Business Management, 1980 from the University of
LaVerne, and an Associate of Arts/Electronics, 1978 from Alan Hancock College.
William J. Barker. Mr. Barker is a Director of the Company. He is also the
owner of the CostPlusFive.com affiliated location in Rockville, Maryland. He
is also President of Amethyst, Inc. from January, 1996 to the present, which
is a computer software and hardware store. Mr. Barker manages all aspects of
store operation, including purchasing, marketing, customer relations,
accounting, proposals, and new business development. From February, 1994
through December, 1996, Mr. Scivally was employed as a Systems Analyst at SAIC
in Annapolis, Maryland. From 1992 through 1995, Mr. Barker was employed as a
Senior Systems Analyst for Science Applications International Corp., where he
coordinated systems integration and development efforts for NSA, the Pentagon,
FBI, Department of Energy and various commercial contacts. From 1990 through
1992 Mr. Barker was employed by Computer Sciences Corporation as Technical
Lead. From 1986 through 1990, he was employed by Scipar, Inc. As a computer
scientist, and from 1986 through 1992, he served in the U.S. Naval Reserve.
He holds an MBA from the University of Maryland, 1994, and a B.S. in Computer
Science from Rochester Institute of Technology.
Item 6. Executive Compensation
The following table sets forth the cash and non-cash compensation paid by the
Company to its Chief Executive Officer and all other executive officers for
services rendered during the fiscal year ended March 30. 1999. No salaries
are being paid at the present time. There were no grants of options or SAR
grants given to any executive officers during the last fiscal year.
<TABLE>
<CAPTION>
Annual Compensation
- -------------------
Name and Position Salary Bonus Annual Deferred Salary
<S> <C> <C> <C> <C> <C>
</TABLE>
Item 7. Certain Relationships and Related Transactions
There have been no transactions since the beginning of fiscal year 1998, or
any currently proposed transactions, or series of similar transactions, to
which the Company was or is to be a party, in which the amount involved
exceeds $60,000, and in which any of the officers, or directors, or holders of
over 5% of the Company's stock have or will have any direct or indirect
material interest. The Company does not currently have any policy toward
entering into any future transactions with related parties.
Item 8. Legal Proceedings
On April 1, 1999, Mary Smith sued the Company and its former President, Robert
T. Yarbray, in the Superior Court of California for the County of Riverside,
Case No. INC 011613, alleging non payment of a $25,000 promissory note. The
Company believes that the lawsuit has no merit, as the Company executed a
first deed of trust on its real property for $250,000 in exchange for $225,000
of loan proceeds from Ms. Smith. Therefore, the $25,000 promissory note was
extinguished by the subsequent promissory note for $250,000, secured by a
first deed of trust.
Item 9. Market Price of and Dividends on the Registrant's Common Equity and
Other Shareholder Matters
The Company's Common Stock has been listed on the NASD OTC Bulletin Board
under the symbol "STSN" in October, 1998. In March, 1999, it changed its
symbol to "USAV." For a short time, the symbol was "CPFV." Since the
Company's initial listing on the OTC Bulletin Board, the high and low sale
prices of company common stock were 1/8 and 2 1/4, respectively. During the
third and fourth quarters of fiscal year 1998, the high and low sale prices of
the Company's common stock were $.50 and $.16, respectively. The Company
considers its Common stock to be thinly traded and that any reported bid or
sale prices may not be a true market-based valuation of the Common Stock. As
of March 30, 1999, there were 93 record holders of the Company's Common Stock.
The Company has not paid any cash dividends since its inception and does not
contemplate paying dividends in the foreseeable future. It is anticipated that
earnings, if any, will be retained for the operation of the Company's
business.
The following table sets forth the range of high and low bid information for
each full quarterly period of the last fiscal year:
[CAPTION]
<TABLE>
Period Reported Average High Bid Average Low
Bid
Quarter ended December 30, 1998 no data available
Quarter ended March 31, 1999 $0.50 $0.16
Item 10. Recent Sales of Unregistered Securities
The Company sold 1,000,000 common shares of unregistered securities in a
Regulation D, Rule 504 exempt offering, which shares were sold in exchange for
services. The offering closed on April 6, 1999. During the calendar year
1999, the Company has sold 47,050 shares of restricted common stock, to
Michael Williams, 100,000 shares of restricted common stock to John and Ruth
Ann Whithrop, and 29, 412 shares of restricted common stock to Lynn Adams,
pursuant to Section 4(2) of the Securities Act of 1933, which resulted in net
proceeds to the Company of $32,000. On May 11, 1999, the Company sold 50,000
shares to its legal counsel under Rule 701, in exchange for services.
Item 11. Description of Securities
Common Stock
The Company is authorized to issue 50,000,000 shares of common Stock at a par
value of $.001. The presently outstanding shares of Common Stock are fully
paid and non-assessable. There are currently outstanding 25,192,555 shares of
Common Stock, as of June 7, 1999. As of the close of the fiscal year 1998,
there were 19,842,000 shares of common stock outstanding.
Holders of shares of Common Stock are entitled to one vote per share on all
matters to be voted upon by the stockholders generally. The approval of
proposals submitted to stockholders at a meeting other than for the election
of directors requires the favorable vote of a majority of the shares voting,
except in the case of certain fundamental matters (such as certain amendments
to the Articles of Incorporation, and certain mergers and reorganizations), in
which cases Nevada law and the Company's Bylaws require the favorable vote of
at least a majority of all outstanding shares. Stockholders are entitled to
receive such dividends as may be declared from time to time by the Board of
Directors out of funds legally available therefor, and in the event of
liquidation, dissolution or winding up of the Company to share ratably in all
assets remaining after payment of liabilities. The holders of shares of
Common Stock have no preemptive, conversion, subscription or cumulative voting
rights.
Under current Nevada law, a shareholder is afforded dissenters' rights which,
if properly exercised, may require the Company to purchase his shares.
Dissenters' rights commonly arise in extraordinary transactions such as
mergers, consolidations, reorganizations, substantial asset sales, liquidating
distributions, and certain amendments to the Company's certificate of
incorporation.
Item 12. Indemnification of Directors and Officers
Nevada Statutes
NRS 78.751 Authorization required for discretionary indemnification;
advancement of expenses; limitation on indemnification and advancement of
expenses.
1. Any discretionary indemnification under NRS 78.7502 unless ordered by a
court or advanced pursuant to subsection 2, may be made by the corporation
only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper in
the circumstances. The determination must be made:
(a) By the stockholders;
(b) By the board of directors by majority vote of a quorum consisting of
directors who were not parties to the action, suit or proceeding;
(c) If a majority vote of a quorum consisting of directors who were not
parties to the action, suit or proceeding so orders, by independent legal
counsel in a written opinion; or
(d) If a quorum consisting of directors who were not parties to the action,
suit or proceeding cannot be obtained, by independent legal counsel in a
written opinion.
2. The articles of incorporation, the bylaws or an agreement made by the
corporation may provide that the expenses of officers and directors
incurred in defending a civil or criminal action, suit or proceeding must
be paid by the corporation as they are incurred and in advance of the final
disposition of the action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the director or officer to repay the amount
if it is ultimately determined by a court of competent jurisdiction that he
is not entitled to be indemnified by the corporation. The provisions of
this subsection do not affect any rights to advancement of expenses to
which corporate personnel other than directors or officers may be entitled
under any contract or otherwise by law.
3. The indemnification and advancement of expenses authorized in or ordered
by a court pursuant to this section:
(a) Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under the
articles of incorporation or any bylaw, agreement, vote of stockholders or
disinterested directors or otherwise, for either an action in his official
capacity or an action in another capacity while holding his office, except
that indemnification, unless ordered by a court pursuant to NRS 78.7502 or
for the advancement of expenses made pursuant to subsection 2, may not be
made to or on behalf of any director or officer if a final adjudication
establishes that his acts or omissions involved intentional misconduct,
fraud or a knowing violation of the law and was material to the cause of
action.
(b) Continues for a person who has ceased to be a director, officer,
employee or agent and inures to the benefit of the heirs, executors and
administrators of such a person.
(Added to NRS by 1969, 118; A 1987, 83; 1993, 976; 1997, 706)
Articles of Incorporation
The Articles of Incorporation do not provide for the indemnification of
officers or directors.
By Laws
Article X - Indemnity
(a) Any person made a party to any action, suit or proceeding, by reason of
the fact that he, his testator or intestate representative is or was a
director, officer of employee of the Corporation, or of any Corporation in
which he served as such at the request of the Corporation, shall be
indemnified by the Corporation against the reasonable expenses, including
attorney's fees, actually and necessarily incurred by him in connection with
the defense of such action, suit or proceedings, or in connection with any
appeal therein, except in relation to matters as to which it shall be adjudged
in such action, suit or proceeding, or in connection with any appeal therein
that such officer, director or employee is liable for negligence or misconduct
in the performance of his duties.
(b) The foregoing right of indemnification shall not be deemed exclusive of
any other rights to which any officer or director or employee may be entitled
apart from the provisions of this section.
(c) The amount of indemnity to which any officer or any director may be
entitled shall be fixed by the Board of Directors, except that in any case
where there is no disinterested majority of the Board available, the amount
shall be fixed by arbitration pursuant to the then existing rules of the
American Arbitration Association.
Item 13. Financial Statements
Independent Auditor's Report
Financial Statements
Balance Sheet
Statement of Operations
Statements of Cash Flows
Statement of Changes in Stockholder's Equity
Notes to Financial Statements
The Board of Directors
CostPlusFive.com, Inc.
(Formerly Stop-N-Sock, Ltd.)
Bermuda Dunes,California
INDEPENDENT AUDITOR'S REPORT
I have audited the accompanying balance sheets of CostPlusFive.com, Inc.
(Formerly Stop-No-Sock, Ltd.) as of March 31, 1999, and the related Statements
of Operations, accumulated deficit, cash flows and changes in shareholders'
equity for the year then ended March 31, 1999. 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.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of CostPlusFive.com, Inc. (Formerly
Stop-N-Sock, Ltd.) As of March 31, 1999 and the results of its operations for the
period then ended in conformity with generally accepted accounting principles.
//s//JULIUS OTTO
Julius A. Otto
Monterey Park, California
April 2, 1999
CostPlusFive.com, Inc.
Balance Sheet
March 31, 1999
ASSETS
Cash $ 210
Furniture and equipment - at stated value
less allowances for depreciation of $7,500 22,500
Notes Receivable - common stock sale - NOTE C 525,000
Gold driving range site costs - NOTES A and D 860,555
Total Assets $1,408,265
LIABILITIES 7 STOCKHOLDER'S EQUITY
LIABILITIES
Accrued expenses $ 357,497
Notes payable, secured by trust deeds
on gold driving range site - NOTE D 562,500
Debentures payable - NOTE E 50,000
Total Liabilities $1,322,823
DEFICIENCY IN ASSETS
COMMON STOCK $.001 par value, 50,000,000
shares authorized, 19,482,000 shares issued
outstanding - NOTES A and E $ 19,482
Additional Pain In Capital (Deficit)
Accumulated during the development stage and
since January 1, 1999 2,721,003
Additional Paid In Capital (Deficit) Accumulated
during the development stage and since January 1, 1999 (2,655,403)
Net Stockholder's Equity 85,442
Total Liabilities and Stockholder's Equity $1,408,265
The accompanying notes are an integral part of these financial statements
CostPlusFive.com, Inc.
(A Development Stage Company)
Statement of Operations
For the year ended March 31, 1999
<S> <C>
Revenue $ 0
Interest expense and foreclosure costs $ 191,474
General, Administrative, Marketing
and Public Relations expenses 2,207,332
Depreciation $ 4,286
Net(loss) $2,403,082)
The accompanying notes are an integral part of these financial statements
</TABLE>
CostPlusFive.com, Inc.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the Year Ended March 31, 1999
<TABLE>
<CAPTION>
Shares of Common Stock Additional Accumulated Total
Common Paid-In (Deficit)
Stock Capital
<S> <C> <C> <C> <C> <C>
Balance 1,850,000 $1,850 $200,097 ($252,321) ($50,374)
Shares
issued in
conjunction
with public
offering
under 504
(D)(Reg)
(D stock)
including
shares
issued in
exchange
for
convertible
subordinated
debentures
and
notes
receivable 2,998,000 2,998 788,402 791,400
Shares
issued
for services
under Rule
144
(restricted
stock) 14,994,000 14,994 1,732,504 1,747,498
Net (loss)
for the year (2,403,082) (2,403,082)
(A) Does not include 1,025,000
shares issued for service - issued
subsequent to 3/31/99 for services
under 504 (D) (Reg D) offering.
The accompanying notes are an integral part of these financial statements
</TABLE>
CostPlusFive.com, Inc.
(A Development Stage Company)
Notes to Financial Statements
NOTE A - ORGANIZATION NAME CHANGE AND CAPITALIZATION
CostPlusFive.com, Inc. (formerly Stop-No-Sock, Ltd.) "the Company" was formed
January 15, 1997 under the laws of the state of Nevada. The initial capital and
stated business purpose of the Company was $201,947 and, together with the cash
proceeds of a public offering, under a Regulation 504(D) exemption, of its
common stock, the Company intended to develop a golf driving range plus certain
other golf related facilities at the golf driving range site and commence
operations.
During the fiscal year ended March 31, 1999 it became apparent that cash
proceeds from the public offering and the operating costs, marketing costs of
the public offering and administrative expenses would not provide sufficient
cash for the completion of the intended development and operation of a golf
driving range site in the near future without significant additional financing
or capital.
As a result of the above the Board of Directors voted to sell the golf driving
range and also to enter into negotiations with a group of investors and
individuals who plan, through the contribution of assets and operations, to
operate certain retail. wholesale and Internet online computer hardware and
software sites. This group currently has nine (9) locations in five (5) states
and is a loosely formed operating entity.
In connection with the negotiations and plans mentioned above the Company sold
2,400,000 shares of its common stock for notes receivable in the amount of
$600,000. The stock was valued at $.25 per share and instructions to the
transfer agent to issue the stock was made in stages of 200,000 shares on
December 30, 1998, 200,000 shares on January 5, 1999 and 2,000,000 shares on
February 22, 1999. The common stock issued was issued under Regulation 504 (D)
"free" trading, registered stock that was the result of the Company's public
offering. See Note C for details of the payment schedule for these notes.
As a result of the above the Company changed its name from Stop-N-Sock, Ltd. To
CostPlusFive.com, Inc. on March 1, 1999 and increased its authorized common
stock ($0.001 par value) from 25,000,000 shares to 50,000,000 shares.
Additionally, as a result of the aforementioned activities the Company ceased to
be a development stage Company.
On February 22, 1999 the Company entered into a sale escrow for the sale of the
gold driving range site. This escrow was for a net sales price of $1,700,000,
to be payable $100,000 on or before April 22, 1999, with the net proceeds
payable at the close of escrow, which was anticipated to occur on or about
June 22, 1999.
The prospective buyer did not perform on the cash payment of the $100,000 and
this sale escrow must be deemed to be canceled. The Company has not pursued
legal restitution for its costs and opportunities lost during the buyer's due
diligence period from February 22, 1999 to April 22, 1999.
The golf driving range sit is expected to be put back on the market in the near
future.
Negotiations and meetings are now being held to consolidate the assets of the
Company and the investor group and to determine the exact nature of future
operations. The completion of such negotiations and meetings is expected to
occur in the immediate future.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
Furniture and equipment are carried at cost. Depreciation is being computed,
using the straight line method, over the estimated useful lives of the assets,
which is seven (7) years.
The gold driving range site is carried at the cost to acquire the real property
plus certain other costs that were incurred to ready the site for development.
NOTE C - NOTES RECEIVABLE
In connection with the issue of common stock, as mentioned in Note A, the
Company received notes receivable (a $500,000 note and a $100,000 note) from
certain investors within or associated with the investor group noted above.
The $500,000 note requires payments of $25,000 every two weeks beginning
March 12, 1999 until April 21, 1999, when a final payment of $400,000 is due
payable.
The principal on the $100,000 note is due and payable on October 1, 1999.
Neither of the notes mentioned above bear interest and interest has not been
imputed since they are currently payable.
The principal payment of $400,000 was not made on April 21, 1999. Current plans
of management are to restructure the notes and, perhaps, increase the
capitalization of the Company. Such negotiations and plans have not been
consummated and the $500,000 note is in default.
NOTE D - OTHER NOTES PAYABLE
Notes payable consist of the following: Note Payable to a Stockholder in the
amount of $250,000 secured by a first trust deed on the golf driving range site,
payable interest only monthly in the amount of $3,125, interest at 15% per
annum,all due and payable September 26, 1000.
Note payable, secured by a second trust deed on the golf driving range site.
This note, plus significant foreclosure costs were paid certain stockholders of
the Company. The note has not been recorded with the County Recorder, repayment
terms or principal amounts have not been determined but the principal amount
shall not, as of March 31, 1999, exceed approximately $336,000, which amount
represents the cash advanced to payoff this note, plus foreclosure costs and to
bring the note payable to a stockholder secured by a third trust deed in the
principal amount of $312,500 current. Included also in the approximate $336,000
are amounts advanced to the company to settle certain lawsuits that arose out of
the initial purchase of the real property. Such additional costs have been
charged to interest expense and foreclosure costs.
Note Payable to a Stockholder in the amount of $312,500, secured by a third
trust deed on the golf driving range site, payable interest only quarterly,
from May 20, 1997 at 7.25% (quarterly payment is $5,664) all due and payable
October 18, 1999.
NOTE E - CONVERTIBLE SUBORDINATED DEBENTURES PAYABLE
The Board of Directors, on July 17, 1997, authorized the sale and issue of a
total of $150,000 in convertible debentures are unsecured, bear interest at 10%,
which is to be accrued and paid on the first day of the thirteenth month after
the day of issuance.
The debentures, together with the accrued interest, are convertible into 1,000
shares of the Company's common stock for each $1,000 principal amount no sooner
than the sixth day of the thirteenth month of the date of issuance. Prior to
March 31, 1999 $100,000 of these debentures have been converted to common
stock.
The remainder are due and payable during the months of April and May 1999.
NOTE F - LEASE COMMITMENT
The Company leases its office space under a month to month lease/rental
agreement. Monthly rental expense payments are $800.
Item 14. Exhibits, Financial Statements
(a) Report of Independent Certified Public Accountant
Financial Statements
Balance Sheets
Statement of Loss And Accumulated Deficit
Statements of Stockholder's Equity
Statements of Cash Flows
Notes to Consolidated Financial Statements
(b) Reports on Form 8-K: Not Applicable
(c) Exhibits
Exhibit No. Description
---------- -----------
3(a) Articles of Incorporation
3(b) By-laws
4(a) Specimen certificate of common stock
10 Other Documents: None
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
CostPlusFive.com, Inc.
//s//MAHLON J. MEIER
By________________________________________
Mahlon J. Meier, President and Director
Date: June 11, 1999
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
__________________________________________
Mahlon J. Meier, President and Director
Date: June 11, 1999
___________________________________________
Franklin R. Scivally, Secretary and Director
Date: June 11, 1999
___________________________________________
Donald R. Smallman, Treasurer and Director
Date: June 11, 1999
___________________________________________
William J. Barker, Secretary and Director
Date: June 11, 1999
Exhibit 3.1
ARTICLES OF INCORPORATION
FILED
IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
JANUARY 15 1997
NO. C594-97
STATE OF NEVADA
SECRETARY OF STATE
IMPORTANT: READ INSTRUCTIONS ON REVERSE SIDE BEFORE COMPLETING THIS FORM
TYPE OR PRINT (BLACK INK ONLY)
1. NAME OF CORPORATION: STOP-N-SOCK, LTD.
2. RESIDENT AGENT: (designated resident agent and his STREET ADDRESS in Nevada
where process may be served)
Name of Resident Agent: Affordable Business Services, Inc.
Street Address: 1055 E. Flamingo Road, #1009A, Las Vegas, NV 89119
3. SHARES: (number of shares the corporation is authorized to issue)
Number of shares with par value: ) Par Value: 0 Number of shares without par
value: 25,000.
4. Governing board: SHALL BE STYLED AS (CHECK ONE) 1 Director Trustees
The FIRST BOARD OF DIRECTORS shall consist of 1 members and the names and
addresses are as follows:
Name: Robert T. Yarbray Address: 76803 Castle Court, Palm Desert, CA.
5. PURPOSE: (optional-see reverse side) the purpose of the corporation shall
be:
6. PERSONAL LIABILITY (pursuant to NRS 78.037): Check one: Accept xxx
Decline
7. OTHER MATTERS: Any other matters to be included in these articles may be
noted on separate pages and incorporated by reference herein a part of these
articles: Number of pages attached:
8. SIGNATURES OF INCORPORATORS: The names and addresses of each of the
incorporators signing the articles (signatures must be)
Name Robert T. Yarbray
Address: 76803 Castle Court, Palm Desert, CA 92211
Signature: //s//ROBERT T. YARBRAY
Subscribed to me and sworn before me this 14th day of
January, 1997
//s//DOUGLAS BECKLEY
Notary Public
(affix notary stamp or seal)
NOTARY PUBLIC
STATE OF NEVADA
COUNTY OF CLARK
My commission expires Oct. 2, 1997
9. CERTIFICATE OF ACCEPTANCE OF APPOINTMENT OF RESIDENT AGENT
I, Affordable Business Services, Inc. hereby accept as Resident Agent for the
above named corporation.
BY: SIGNATURE ILLEGIBLE
Signature of Resident Agent
1/14/97
Exhibit 3.2
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After Issuance of Stock)
FILED IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
JUNE 27 1997
NO. C594-97
STOP-N-SOCK, LTD.
Name of Corporation
We, the undersigned, ROBERT T. YARBRAY President or Vice President and ROBERT T.
YARBRAY Secretary or Assistant Secretary of STOP-N-SOCK, LTD., name of
Corporation, `do hereby certify:
That the Board of Directors of said corporation at a meeting duly convened, held
on the First day of June, 1997, adopted a resolution to amend the original
articles as follows:
Article 3 is hereby amended to read as follows:
SHARES: Number of shares with par value: 25,000,000 Par value: .001
The number of shares of the corporation outstanding and entitled to vote on an
amendment to the Articles of Incorporation is 25,000; that the said change(s)
and amendment have been consented to and approved by a majority vote of the
stockholders holding at least a majority of each class of stock outstanding and
entitled to vote thereon.
//s//ROBERT T. YARBRAY President
//s//ROBERT T. YARBRAY, Secretary
State of Nevada
County of Clark
On June 28, 1997, personally appeared before me, a Notary Public, Robert T.
Yarbray, who acknowledge that they executed the above instrument.
//SIGNATURE ILLEGIBLE
Signature of Notary
Notary Public-State of Nevada
County of Clark
Thomas A. Baez
My Commission Expires
June 6, 1999
(Notary Stamp or Seal)
Exhibit 3.3
CERTIFICATE OF AMENDMENT OF ARTICLES OF INCORPORATION
(After Issuance of Stock)
FILED IN THE OFFICE OF THE
SECRETARY OF STATE OF THE
STATE OF NEVADA
MAR 1 1999
NO. C594-97
STOP-N-SOCK, LTD.
Name of Corporation
We, the undersigned, ROBERT T. YARBRAY President or Vice President and ROBERT T.
YARBRAY Secretary or Assistant Secretary of STOP-N-SOCK, LTD., name of
Corporation, `do hereby certify:
That the Board of Directors of said corporation at a meeting duly convened, held
on the First day of March, 1999, adopted a resolution to amend the original
articles as follows:
Article 1 is hereby amended to read as follows:
NAME OF CORPORATION: CostPlusFive.com, Inc.
Article 3 is hereby amended to read as follows:
SHARES: Number of shares with par value: 50,000,000 Par value: .001
The number of shares of the corporation outstanding and entitled to vote on an
amendment to the Articles of Incorporation is 13,848,000; that the change(s)
and amendment have been consented to and approved by a majority vote of the
stockholders holding at least a majority of each class of stock outstanding and
entitled to vote thereon.
//s//ROBERT T. YARBRAY President
//s//GEORGE WHITE, Secretary
State of Nevada
County of Clark
On March 1, 1999, personally appeared before me, a Notary Public, Robert T.
Yarbray, who acknowledge that they executed the above instrument.
//SIGNATURE ILLEGIBLE
Signature of Notary
Notary Public-State of Nevada
County of Clark
SEAL ILLEGIBLE
March 1, 1999
(Notary Stamp or Seal)
Innovative Tracking Solutions Corporation, a corporation organized and existing
under and by virtue of the General Corporation Law of the State of Delaware.
DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of Innovative
Tracking
Solutions Corporation, resolutions were duly adopted setting forth a proposed
amendment of the Certificate of Incorporation of said corporation, declaring
said amendment to be advisable and resolution setting forth the proposed
amendment is as follows:
RESOLVED: That the Certificate of incorporated of this corporation be
amended by deleting the Heading,. Article(s) Ninth and changing Article(s)
Fourth, Seventh, and Eighth so that the document shall read as follows:
FOURTH: The amount of the total authorized capital stock of this
corporation is (ten million) 10,000,000 shares of $.001 Par Value.
SEVENTH: The Directors shall have power to make and to alter or amend
the
By-Laws; to fix the amount to be reserved as working capital, and to authorize
and cause to be executed, mortgages and liens without limit as to the amount,
upon the property and franchise of the Corporation.
With the consent in writing, and pursuant to a vote of the holders of a
majority of the capital stock issued and outstanding, the Directors shall have
the authority to dispose, in any manner, of the whole property of this
corporation.
The By-Laws shall determine whether and to what extent the accounts and
books of this corporation, or any of them shall be open to the inspection of
the stockholders; and no stockholder shall have any right of inspecting any
account, or book or document of this corporation, except as conferred by the
law or the By-Laws or by resolution of the stockholders or directors, except
as otherwise required by the laws of the State of Delaware.
It is the intention that the objects, purposes and powers specified in
the
Third paragraph hereof shall, except where otherwise specified in said
paragraph, be nowise limited or restricted by reference to or inference from
the terms of any purpose and powers specified in the Third paragraph and in
each of the clauses or paragraphs of this charter shall be regarded as
independent objects, purposes and powers.
EIGHTH: Directors of the corporation shall not be liable to either the
corporation or its stockholders for monetary damages for a breach of fiduciary
duties unless the breach involves: (1) a director's duty of loyalty to the
corporation or its stockholders; (2) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law; (3)
liability for unlawful payments of dividends or unlawful stock purchases or
redemption by the corporation; or (4) a transaction from which the director
derived an improper personal benefit.
Exhibit 3.3
BY-LAWS -OF-
STOP-N-SOCK, LTD.
ARTICLE I - OFFICES
The office of the Corporation shall be located in the City and State
designated in the Articles of Incorporation. The Corporation may also
maintain offices at such other places within or without the United States as
the Board of Directors may, from time to time determine.
ARTICLE II - MEETING OF SHAREHOLDERS
Section 1 - Annual Meetings:
The annual meeting of the shareholders of the Corporation shall be held within
five months after the close of the fiscal year of the Corporation, for the
purpose of electing directors, and transacting such other business as may
properly come before the meeting.
Section 2 - Special Meetings:
Special meetings of the shareholders may be called at any time by the Board of
Directors or by the President, and shall be called by the President or the
Secretary at the written request of the holders of ten per cent (10%) of the
shares then outstanding and entitled to vote thereat, or as otherwise required
under the provisions of the Business Corporation Law.
Section 3 - Place of Meetings:
All meetings of shareholders shall be held at the principal office of the
Corporation, or at such other places as shall be designated in the notices or
waives of notice of such meetings.
ARTICLE IV - OFFICERS
Section 1 - Number, Qualifications, Election and Term of Office:
(a) The officers of the Corporation shall consist of a President, a
Secretary, a Treasurer, and such other officers, including a Chairman of the
Board of Directors, and one or more Vice Presidents, as the Board of Directors
may from time to time deem advisable. Any officer other than the Chairman of
the Board of Directors may be, but is not required to be, a director of the
Corporation. Any two or more offices may be held by the same person.
(b) The officers of the Corporation shall be elected by the Board of
Directors at the regular annual meeting of the Board following the annual
meeting of shareholders.
(c) Each officer shall hold office until the annual meeting of the Board of
Directors next succeeding his election, and until his successor shall have
been elected and qualified, or until his death, resignation or removal.
Section 2 - Resignation:
Any officer may resign at any time by giving written notice of such
resignation to the Board of Directors, or to the President or the Secretary of
the Corporation. Unless otherwise specified in such written notice, such
resignation shall take effect upon receipt thereof by the Board of Directors
or by such officer, and the acceptance of such resignation shall not be
necessary to make it effective.
Section 3 - Removal:
Any officer may be removed, either with or without cause, and a successor
elected by a majority vote of the Board of Directors at any time.
Section 4 - Vacancies:
A vacancy in any office by reason of death, resignation, inability to act,
disqualification, or any other cause, may at any time be filled for the
unexpired portion of the term by a majority vote of the Board of Directors.
Section 5 - Duties of Officers:
Officers of the Corporation shall, unless otherwise provided by the Board of
Directors, each have such powers and duties as generally pertain to their
respective offices as well as such powers and duties as may be set forth in
these by-laws, or may from time to time be specifically conferred or imposed
by the Board of Directors. The president shall be the chief executive officer
of the Corporation.
ARTICLE V - SHARES OF STOCK
Section 1 - Certificate of Stock:
(a) The certificates representing the shares of the Corporation shall be in
such form as shall be adopted by the Board of Directors, and shall be numbered
and registered in the order issued. They shall bear the holder's name and the
number of shares, and shall be signed by (I) the Chairman of the Board of the
Present or a Vice President, and (ii) the Secretary or Treasurer, or any
Assistant Secretary or Assistant Treasurer, and shall bear the corporate seal.
(b) No certificate representing shares shall be issued until the full amount
of consideration therefor has been paid, except as otherwise permitted by law.
(c) To the extent permitted by law, the Board of Directors may authorize the
issuance of certificates for fractions of a share which shall entitle the
holder to exercise voting rights, receive dividends and participate in
liquidating distributions, in corporation to the fractional holdings; or it
may authorize the payment in cash of the fair value of fractions of a share as
of the time when those entitled to receive such fractions are determined; or
it may authorize the issuance, subject to such conditions as may be permitted
by law, of scrip in registered or bearer form over the signature of an officer
or agent of the Corporation, exchangeable as therein provided for full shares,
but such scrip shall not entitle the holder to any rights of a shareholder,
except as therein provided.
Section 2 - Lost or Destroyed Certificates:
The holder of any certificate representing shares of the Corporation shall
immediately notify the Corporation of any loss or destruction of the
certificate representing the same. The Corporation may issue a new
certificate in the place of any certificate theretofore issued by it, alleged
to have been lost or destroyed. On production of such evidence of loss or
destruction as the Board of Directors in its discretion may require, the Board
of Directors may, in its discretion, require the owner of the lost or
destroyed certificate, or his legal representatives, to give the Corporation a
bond in such sum as the Board may direct, and with such surety or sureties as
may be satisfactory to the Board, to indemnify the Corporation against any
claims, loss, liability or damage it may suffer on account of the issuance of
the new certificate. A new certificate may be issued without requiring any
such evidence or bond when, in the judgement of the Board of Directors, it is
proper so to do.
Section 6 - Sureties and Bonds:
In case the Board of Directors shall so require, any officer, employee or
agent of the Corporation shall execute to the Corporation a bond in such sum,
and with such surety or sureties as the Board of Directors may direct,
conditioned upon the faithful performance of his duties to the Corporation,
including responsibility for negligence and for the accounting for all
property, funds or securities of the Corporation which may come into his
hands.
Section 7 - Shares of Other Corporations:
Whenever the Corporation is the holder of shares of any other corporation, any
right or power of the Corporation as such shareholder (including the
attendance, acting and voting at shareholders' meetings and execution of
waivers, consents, proxies or other instruments) may be exercised on behalf of
the Corporation by the President, any Vice President, or such other person as
the Board of Directors may authorize.
ARTICLE VI - DIVIDENDS
Subject to applicable law, dividends may be declared and paid of any funds
available therefor, as often, in such amounts, and at such time or times as
the Board of Directors may determine.
ARTICLE VII-FISCAL YEAR
The fiscal year of the Corporation shall be fixed by the Board of Directors
from time to time, subject to applicable law.
ARTICLE VIII-CORPORATE SEAL
The corporate seal, if any, shall be in such form as shall be approved from
time to time by the Board of Directors.
ARTICLE IX - AMENDMENTS
Section 1 - By Shareholders:
All by-laws of the Corporation shall be subject to alteration or repeal, and
new by-laws may be made, by the affirmative vote of shareholders holding of
record in the aggregate at least a majority of the outstanding shares entitled
to vote in the election of directors at any annual or special meeting of
shareholders, provided that the notice or waiver of notice of such meeting
shall have summarized or set forth in full therein, the proposed amendment.
Section 2 -By Directors:
The Board of Directors shall have power to make, adopt, alter, amend and
repeal, from time to time, by-laws of the Corporation; provided, however, that
the shareholders entitled to vote with respect thereto as in this Article IX
above-provided may alter, amend or repeal by-laws made by the Board of
Directors, except that the Board of Directors shall have no power to change
the quorum for meetings of shareholders or the Board of Directors, or to
change any provisions of the by-laws with respect to the removal of directors
or the filling of vacancies in the Board resulting from the removal by the
shareholders. If any by-law regulating an impending election of directors is
adopted, amended or repealed by the Board of Directors, there shall be set
forth in the notice of the next meeting of shareholders for the election of
directors, the by-law so adopted, amended or repealed, together with a concise
statement of the changes made.
Section 3 - Transfers of Shares:
(a) Transfers of shares of the Corporation shall be made on the share records
of the Corporation only by the holder of record thereof, in person or by his
duly authorized attorney, upon surrender for cancellation of the certificate
or certificates representing such shares, with an assignment or power of
transfer endorsed thereon or delivered therewith, duly executed, with such
proof of the authenticity of the signature and of authority to transfer and of
payment of transfer taxes as the Corporation or its agents may require.
(b) The Corporation shall be entitled to treat the holder of record of any
share or shares as the absolute owner thereof for all purposes and,
accordingly, shall not be bound to recognize any legal, equitable or other
claim to, or interest in, such share or shares on the part of any other
person, whether or not it shall have express or other notice thereof, except
as otherwise expressly provided by law.
Section 4 - Record Date:
In lieu of closing the share records of the Corporation, the Board of
Directors may fix, in advance, a date not exceeding fifty days, or less than
ten days, as the record date for the determination of shareholders entitled to
receive notice of, or to vote at, any meeting of shareholders, or to consent
to any proposal without a meeting, or for the purpose of determining
shareholders entitled to receive payment of any dividends, or allotment of any
rights, or for the purpose of any other action. If no record date is fixed,
the record date for the determination of shareholders entitled to notice of or
to vote at a meeting of shareholders shall be at the close of business on the
day next preceding the day on which notice is given, or, if no notice is
given, the day on which the meeting is held; the record date for determining
shareholders for any other purpose shall be at the close of business on the
day on which the resolution of the directors relating thereto is adopted.
When a determination of shareholders of record entitled to notice of or to
vote at any meeting of shareholders has been made as provided for herein, such
determination shall apply to any adjournment thereof, unless the directors fix
a new record date for the adjourned meeting.
Section 13 - Committees:
The Board of Directors, by resolution adopted by a majority of the entire
Board, may from time to time designate from among its members an executive
committee and such other committees, and alternate members thereof, as they
deem desirable, each consisting of three or more members, with such powers and
authority (to the extent permitted by law) as may be provided in such
resolution. Each such committee shall serve at the pleasure of the Board.
ARTICLE X - INDEMNITY
(a) Any person made a party to any action, suit or proceeding, by reason of
the fact that he, his testator or intestate representative is or was a
director, officer of employee of the Corporation, or of any Corporation in
which he served as such at the request of the Corporation, shall be
indemnified by the Corporation against the reasonable expenses, including
attorney's fees, actually and necessarily incurred by him in connection with
the defense of such action, suit or proceedings, or in connection with any
appeal therein, except in relation to matters as to which it shall be adjudged
in such action, suit or proceeding, or in connection with any appeal therein
that such officer, director or employee is liable for negligence or misconduct
in the performance of his duties.
(b) The foregoing right of indemnification shall not be deemed exclusive of
any other rights to which any officer or director or employee may be entitled
apart from the provisions of this section.
(c) The amount of indemnity to which any officer or any director may be
entitled shall be fixed by the Board of Directors, except that in any case
where there is no disinterested majority of the Board available, the amount
shall be fixed by arbitration pursuant to the then existing rules of the
American Arbitration Association.
The undersigned incorporator certifies that he has adopted the foregoing
by-laws as the first by-laws of the Corporation.
Dated: January 15, 1997
//s// ROBERT T. YARBRAY
-------------------------
Incorporator
Exhibit 4.1
<SEQUENCE>4
[DESCRIPTION]SPECIMEN OF COMMON STOCK CERTIFICATE
EXHIBIT
COSPLUSFIVE.COM., INC.
[________]NUMBER SHARES[________]
INCORPORATED UNDER THE LAWS OF THE STATE OF NEVADA
50,000,000 SHARES COMMON STOCK AUTHORIZED, $.001 PAR VALUE
COMMON STOCK CUSIP 22161W 10 8
SEE REVERSE FOR CERTAIN
DEFINITIONS
THIS CERTIFIES THAT
Is the RECORD HOLDER OF SHARES OF FULLY PAID AND NON-ASSESSABLE
SHARES OF COMMON STOCK OF COSTPLUSFIVE.COM, INC.
TRANSFERABLE ON THE BOOKS OF THE CORPORATION IN PERSON OR BY DULY AUTHORIZED
ATTORNEY UPON SURRENDER OF THIS CERTIFICATE PROPERLY ENDORSED. THIS
CERTIFICATE AND THE SHARES REPRESENTED HEREBY ARE SUBJECT TO THE LAWS OF THE
STATE OF NEVADA, AND TO THE CERTIFICATE OF INCORPORATION AND BYLAWS OF THE
CORPORATION, AS NOW OR HEREAFTER AMENDED. THIS CERTIFICATE IS NOT VALID UNTIL
COUNTERSIGNED BY THE TRANSFER AGENT.
WITNESS the facsimile seal of the Corporation and the signature of its duly
authorized officers.
Dated:
[SEAL OF COSTPLUSFIVE.COM,INC.]
/s / ROBERT T. YARBRAY /s/ G.R. WHITE
- - ----------------------- ---------------------
President Secretary
COUNTERSIGNED
PACIFIC STOCK TRANSFER COMPANY
P.O. Box 93385
Las Vegas, NV 89193
By: ^^Illegible Signature^^
5899 south State Street
Salt Lake City, UT 84107
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT -
____Custodian____
TEN ENT - as tenants by the entireties (Cust)
(Minor)
JT TEN - as joint tenants with right under Uniform Gifts to
Minors
of survivorship and not as Act ________________________
tenants in common (State)
Additional abbreviation may also be used though not in above
list.
FOR VALUE RECEIVED, _________hereby sell, assign and transfer
unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- - --------------------------------------
- - --------------------------------------
__________________________________________________________________________
(Please print or typewrite name and address including zip code of assignee)
__________________________________________________________________________
__________________________________________________________________________
__________________________________________________________________________
Shares of the capital stock represented by the within Certificate, and do
hereby irrevocably constitute and appoint
__________________________________________________________________________
Attorney to transfer the said stock on the books of the within-named
Corporation with full power of substitution in the premises.
Dated, ---------------------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the Certificate, in every particular, without
alteration or enlargement, or any change whatever.
