U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
STRATEGIC PARTNERS, INC.
(Name of small business issuer in its charter)
Wyoming (state of Incorporation)
6199 (Primary Standard Industrial Classification Code
Number)
77-0494696 (IRS Employer ID No.)
SEC File No. 333-
3525 Sunset Lane
Oxnard, CA 93035
805-984-0821
(Address and telephone number of registrant's principal
executive
offices and principal place of business)
Frank J. Weinstock
3525 Sunset Lane
Oxnard, CA 93035
805-984-0821
(Name, address and telephone number of agent for service)
Copies to:
David Lilly
Lance Kerr Law Office
8833 Sunset Blvd. Suite 200
West Hollywood, Calif. 90069
310-289-4947
Approximate date of proposed sale to the public: As soon
as practicable after the Registration Statement becomes
effective.
If this form is filed to register additional securities
for an offering pursuant to Rule 462(b) under the Securities
Act, check the following box and list the Securities Act
registration statement number for the same offering. [ ]
If this form is a post-effective amendment filed pursuant
to Rule 462(c) under the Securities Act, check the following box
and list the Securities Act registration statement number of the
earlier effective registration statement the same offering. [ ]
If this form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement the same offering [ ]
If delivery of the prospectus is expected to be made pursuant
to Rule 434, please check the following box [ ]
The registrant hereby amends this registration statement on
such date or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that
this registration statement shall thereafter become effective in
accordance with section 8(a) of the Securities Act of 1933 or until the
registration statement shall become effective on such date as the Commission
acting pursuant to said section 8(a) may determine.
Calculation of Registration Fee
<TABLE>
<CAPTION>
Proposed
Proposed Maximum
Title of Each Class Maximum Aggregate Amount of
of Securities to be Amount to be Offering Price Offering Registration
Registered(1) Registered (1) Per Unit(1) Price(2) Fee
-------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Units (1) 300 $ 2,000 $600,000 $167.00
</TABLE>
--------------------------------------------------------------------------
(1) A Unit consists of 1,000 shares of common stock, par value
$0.001.
(2) Estimated solely for the purpose of computing the amount of
the registration fee pursuant to Rule 457(a) under the Securities Act
of 1933.
(3) The registrant is carrying forward 200 units for which
fees were paid under the original registatement statement
declared effective May 16, 2000.
----------------
The Registrant hereby amends this Registration Statement on
such date or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment that specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to such Section 8(a), may determine.
PROSPECTUS
STRATEGIC PARTNERS, INC.
Initial Public Offering
300 units consisting of 1,000 shares of common Stock each at the
rate of $ 2,000 per unit.
Strategic Partners, Inc. is a development stage company
without significant assets or business. It was
formed to engage in the business of providing consulting services
to companies with respect to finance, mergers, acquisitions, raising
capital in the public markets and marketing on the internet. The offering
is on a best efforts basis. The offering will be sold by our officers
and directors acting as agents. There is no minimum of amount of
shares that must be sold. There is currently no market for the
shares The termination date for the offering is 8/15/2000.
Securities offered hereby involve a high degree of
risk. These securities have not been approved or disapproved
by the Securities and Exchange Commission nor has the
Commission passed upon the accuracy or adequacy of
this prospectus. Any representation to the contrary is a
criminal offense.
These securities offered hereby involve a high degree
of risk. See "RISK FACTORS" on page 3.
Table of Contents
Summary of the Offering.........................................1
Risk Factors....................................................2
Use of Proceeds.................................................3
Determination of Offering Price.................................4
Dilution .......................................................4
Plan of Distribution ...........................................5
Legal Proceedings ..............................................5
Directors and Officers..........................................5
Principal Stockholders .........................................8
Description of Securities ......................................9
Transfer Agent..................................................9
Reports to Stockholders.........................................9
Interest of Named Experts and Counsel...........................9
Disclosure of Commission Position of
Indemnification for Securities Act Liabilities...............10
Organization Within Last Five Years............................10
Description of Business........................................10
Management's Discussion and Analysis of the
Plan of Operation............................................12
Description of Property........................................12
Certain Relationships and Related Transactions.................12
Market for Common Equity and Related
Stockholder Matters..........................................12
Executive Compensation.........................................13
Financial Statements..................................F-1 to F-29
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure .........................14
SUMMARY OF THE OFFERING
Strategic Partners, Inc. was incorporated in 1998 for the
purpose of engaging in investment banking and providing financial consulting
services to businesses and individuals. Since incorporation our officers
and directors have been to engaged in research as to how best to
market our services in the financial services industry and to raise money
to open offices and conduct business.
OFFERING OF UNITS
Units Offered - 300
Minimum Number of Units to be Sold - No Minimum
Maximum Number of Units to be Sold - 300
Minimum/Maximum Number of Units to be Sold to
Each Purchaser - One (unless more are allowed
in our discretion)
Units consist of 1,000 shares of common stock
Unit Price - $ 2,000
Shares Outstanding Prior to Offering - 569,000
Shares Outstanding after Offering if all sold - 869,000
Use Of Proceeds:
Legal
Administrative Assistant & Secretarial
Marketing & Travel Expense
Facilitate Strategic Alliance Group
Design & Printing
Office Leasehold
Shareholder Releases - Mail
General Mail - Incl. Courier Services
Phones/Fax/Internet
Public/Investor Relations
Office Equipment; lease/purchase
Financial Conferences/Seminars
Advertising & Brochures
Website Design and Hosting
Accounting
THE COMPANY
We are organized as a Wyoming corporation named Strategic
Partners, Inc. Our offices are located at 3525 Sunset Lane, Oxnard,
California. The telephone is 805-984-0821.
RISK FACTORS:
We have had losses since inception and such losses are
expected to continue for the foreseeable future. We were incorporated in
September of 1998. Since that time we have worked on raising operating
funds and developing plans to market our services utilizing the
internet. We have experienced losses to date as funds available have not
been sufficient to operate in a profitable manner. We believe we have
a viable plan of operation and can generate profits if we have
sufficient working capital. The risk to investors is that if we are not
able to generate sufficient working capital from this offering it
will become difficult to market our services and obtain clients.
We are Dependent Upon Key Personnel and Affiliates. We are
highly dependent on the services of Frank J. Weinstock, our President
and CEO. Mr. Weinstock has signed a five year management
contract beginning in October of 1999. Under this contract Mr.
Weinstock is to be paid an annual salary of $ 150,000. In
addition he is to be reimbursed for reasonable business
expenses. Our ability to pay Mr. Weinstock and related
persons is a risk of investing in the Company.
We may not be able to successfully implement our
business plan. The success of the business plan is
highly dependent on the success of the offering of
units hereunder. If the offering is fully sold
we will be able to operate for a period
of twelve months without additional capital. If
less than the full offering is sold our ability
to operate will be hampered. At a minimal level
of funding we will be able to open an
office and hire two or more employees. We
will began our sales efforts and attempt to generate
fee income. The more capital raised the greater is our ability to
generate fee business. If the offering is fully funded we can
hire additional sales persons and support staff that will
attract more business.
ADDITIONAL INFORMATION
We have filed with the Securities and Exchange Commission in
Washington, D.C., a registration statement under the
Securities Act of 1933, as amended, with respect to the common
stock offered by this prospectus. For further information with respect to our
company and the common stock offered hereby, reference is made to the
registration statement and the exhibits listed in the registration statement.
The registration statement may be examined at the Public Reference
Room of the Securities and Exchange Commission at 450 Fifth Street, N.W.
Washington, D.C. 20549, and copies may be obtained upon payment of the
prescribed fees.
We are an electronic filer, and the Securities and Exchange
Commission maintains a web site that contains reports, proxy and information
statements and other information regarding registrants that file
electronically with the Commission. The address of the SEC website is
http://www.sec.gov. To find information go to Edgar Archives and
search under the Registrant name (Strategic Partners, Inc.) or
CIK number (1100313).
We will file reports with the Securities and Exchange Commission
and intend to furnish shareholders with annual reports containing
financial statements audited by independent public or certified accountants
and such other periodic reports as it may deem appropriate or as
required by law.
USE OF PROCEEDS
The use of proceeds will be disbursed for organizational and
marketing efforts. The offering is on a "best efforts" basis. If no funds
are received we will have no proceeds to spend. We reserve the right to
expend funds as received.
The following table sets forth the uses of proceeds if only
10% of the offering is sold. At this level the total funds
available would be equal to $ 60,000
USE OF PROCEEDS EQUAL TO 10% OF OFFERING:
Legal $ 5,000
Administrative Assistant & Secretarial 4,000
Marketing & Travel Expense 6,000
Facilitate Strategic Alliance Group 2,000
Design & Printing 2,000
Office Leasehold 6,000
Misc. Supplies 3,000
Shareholder Releases - Mail 2,000
General Mail - Incl. Courier Services 2,000
Phones/Fax/Internet 3,000
Public/Investor Relations 9,000
Office Equipment; lease/purchase 5,000
Financial Conferences/Seminars 3,000
Advertising & Brochures 2,000
Website Design and Hosting 4,000
Accounting 2,000
__________
$ 60,000
USE OF PROCEEDS EQUAL TO 50% OF OFFERING:
Legal $ 25,000
Administrative Assistant & Secretarial 25,000
Marketing & Travel Expense 33,000
Facilitate Strategic Alliance Group 7,000
Design & Printing 7,000
Office Leasehold 30,000
Misc. Supplies 20,000
Shareholder Releases - Mail 4,000
General Mail - Incl. Courier Services 4,000
Phones/Fax/Internet 15,000
Public/Investor Relations 45,000
Office Equipment; lease/purchase 25,000
Financial Conferences/Seminars 20,000
Advertising & Brochures 13,000
Website Design and Hosting 22,000
Accounting 5,000
__________
$ 300,000
USE OF PROCEEDS IF ALL UNITS ARE SOLD:
Legal $ 55,000
Administrative Assistant & Secretarial 53,000
Marketing & Travel Expense 66,000
Facilitate Strategic Alliance Group 23,000
Design & Printing 14,000
Office Leasehold 60,000
Misc. Supplies 30,000
Shareholder Releases - Mail 8,000
General Mail - Incl. Courier Services 8,000
Phones/Fax/Internet 30,000
Public/Investor Relations 90,000
Office Equipment; lease/purchase 55,000
Financial Conferences/Seminars 30,000
Advertising & Brochures 25,000
Website Design and Hosting 44,000
Accounting 9,000
__________
$ 600,000
DETERMINATION OF OFFERING PRICE
We have arbitrarily determined the
offering price of the units.
DILUTION
This offering involves a dilution of net tangible book value
to the existing shareholders. Assuming the maximum amount of
units offered are sold the following table shows the dilution
to persons who purchase to this offering.
<TABLE>
<S>
<C>
Assumed initial public offering
price per share................................. $ 2.00
Pro forma net tangible book
value per share as of Dec.31, 1999............... $ 0.04
Pro forma increase
attributable to new investors................... $.0.57
Pro forma net tangible book value per
share after the offering....................... $ 0.61
Pro forma dilution per share to new
investors...................................... $ 1.39
</TABLE>
The following table summarizes the total number of shares of
common stock purchased from us, the total consideration paid to us and the
average price per share paid by existing stockholders and by new investors,
in each case based upon the number of shares of common stock outstanding as of
December 31, 1999.
<TABLE>
<CAPTION>
Shares Purchased Total Consideration
Average Price
Number Percent Amount Percent Per Share
<S> <C> <C> <C> <C> <C>
Existing stockholders...569,000 65.5% $ 569,000 48.6 % $ 1.00
New investors...........300,000 34.5% $ 600,000 51.4 % $ 2.00
---------- -------- --------- --------
Total 869,000 100.0% $ 1,169,000 100.0%
======= ====== =========== =======
</TABLE>
PLAN OF DISTRIBUTION
We plan to distribute the shares on a "best efforts"
basis utilizing our officers and directors. In doing so we
will rely on Exchange Act Rule 3a4-1 which permits
officers and directors to sell without registering as
brokers/dealers. We plan to offer the securities on the company
website. If offered on the website the announcement will be
limited to information of a general nature. The offer will be
made via the prospectus which may be transmitted by
email or sent by mail in printed form. No company has been
engaged as an underwriter. We may hire broker/dealers to sell all
or a portion of the offering. In such event we will cease all
marketing efforts by our officers and directors and will file a
post-effective amendment to indicate that this change in the plan
of distribution.
LEGAL PROCEEDINGS
There are no legal proceedings pending against us.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The following persons are our officers and directors:
Frank J. Weinstock, Director, President and Chief Executive
Officer
Frank J. Weinstock, age 62, is the founder of Strategic
Partners, Inc. Mr. Weinstock has served as President and Chief
Executive Officer of our company since founded in Sept.,1998.
From 1989 to 1998 Mr. Weinstock worked as an independent analyst and
consultant providing corporate structuring, reorganizations,
mergers/acquisitions and other sophisticated services
including financial development. Mr. Weinstock's forte has been
exclusively centered around fast pace growth companies in corporate America.
From 1982 to 1988 he served as Chief Financial Officer of Diversified
Technology, Inc., an international company in the business of licensing
intellectual property of advanced medical products, consisting of
bio-compatible osteogenic polymers (BOP), exported from the Soviet Union
to the western free world. From 1978 to 1982 he served as Chief Operating
Officer of Western Gold'n Gas Company engaged in the business of developing
natural gas fields by drilling company owned acreage in partnership with
major national and international conglomerates. From 1974 to 1978 he was
instrumental and responsible for the development and promotional activities
of Greenwich Pharmaceutical, a public company, pka, Strategic Medical
Research Corp.(SMRC) 1969 to 1990, President of J.J.Weinstock Agency, Inc.
an independent insurance agency and large brokerage facility.
It was during these formidable years that Mr. Weinstock
successfully created, integrated and combined insurance with securities
complimenting large estate planning services, much before the advent of
"Universal Life". From 1962 to 1969 he specialized in Fire, Property &
Casualty Insurance manuscripting forms for large commercial and industrial
organizations. He also packaged and combined comprehensive
personal lines insurance. During Mr. Weinstock's twenty-nine year tenure, he
specialized in aviation (FBO'S), medical malpractice and tailoring unique
disability coverages for high profile medical practitioners, while designing
sophisticated estate planning techniques. Due to Mr. Weinstock's
other business and financial interests in broadening his corporate
horizons the insurance business was sold.
Alex Blumkin, Director.
Alex Blumkin, age 29, graduated from high school in Odessa, Ukraine in 1987
specializing in English and other foreign languages. He attended Medical
College No. 1 and graduated in 1989 with a degree in Dentistry. He graduated
in 1992 from Yshinsky University with a teaching certificate in Psychology.
Following graduation from college Mr. Blumkin became active in the
import/export business. He established Bipa, a company engaged in trading
commodities, precious metals and other natural resources. In 1995 Bipa was
listed as one of the largest 1,000 companies of its type in the Universal
Space catalog. Bipa was enormously successful.
In the course of developing Bipa Mr. Blumkin developed strong American
relationships consulting on a broad array of contracts establishing business
activities resulting in impressive profitability. Mr. Blumkin visited the
United States many times and made use of his skills and contacts learning how
to apply American business methods to the economy in the Ukraine. Mr. Blumkin
organized a new company called Exodus which introduced the first credit card
in the Ukraine. The introduction of the credit card expanded the business
possibilities of local companies allowing their goods and services to be
purchased by individuals using credit rather than hard currency. The use of
credit cards was supported and backed by the major banking systems in the
Ukraine largely through the efforts of Mr. Blumkin. This success opened
numerous doors and presented many new business opportunities at the global
level.
In addition to operating the credit card business Exodus became the
largest advertising agency in the Ukraine. Due to his knowledge and business
acumen efforts Exodus introduced the first yellow pages for telephone
directories in the Ukraine. Mr. Blumkin and his associates developed the
largest Exhibition Center in the Ukraine to promote international trade.
Outdoor advertising including billboards and light boxes were introduced to
improve the marketing of goods and services for businesses in the Ukraine. The
success of Exodus led to increased business activity in numerous regions of
the Ukrainian economy.
Mr. Blumkin lived in the United States for several years beginning in
1995 as a legal immigrant. He has actively continued his business interests In
the United States. In 1999 he proudly became a U.S. citizen. He has been
active for the last few years in the financial sector. Investments being his
area of expertise he seeks opportunities in real estate, securities and
business turnarounds. He currently has ownership interests in A.S. Victory, a
hotel supply company which is experiencing rapid growth. He will serve as a
director until the next scheduled meeting of shareholders in January, 2001.
GEORGE FENCL, Director
Mr. Fencl, age 58, is currently Secretary and Treasurer, J.T.
Granatelli Lubricants, Inc. He has thirty five years experience
as a business owner in retail stores, restaurant business and
manufacturing. Since 1984 he has acted as an investor and consultant
for various real estate ventures; high tech; corporations; and creative
talent management companies.
Mr. Fencl owned and operated one of the largest jewelry
production companies on the west coast. He was one of the first
owner/operators in the vending machine business on the west coast
and developed an extremely strong and viable business.
Mr. Fencl owns and manages extensive high end real estate
properties, including vast commercial operations, both abroad and in the
United States. He has extensive experience at the global level relative to
franchise operations and license agreements. He also possesses a vast
experience on Wall Street internationally with ownership of merchant banks,
as well as an invaluable insight; with a blend of knowledge and
experience resulting in tremendous success. A broad background
and experience with major companies in corporate America, many of
which are public entities further strengthened his relationships and
accomplishments on Wall Street.
Mr. Fencl is a long time automotive enthusiast with partners
in auto racing teams; including part owner of Irwindale Raceway. He
built custom street vehicles and has been a consultant to various specialty
automotive manufacturers. Mr. Fencl was on the Board of Directors of Vector
Car Company during the time it was owned directly by Lamborghini and was an
advisor to Lamborghini Automotive. He retains ownership of the Lamborghini
name.
Mr. Fencl attended the Institute of Art, Northrop Institute of
Technology, Mount San Antonio College (with emphasis in Business Law) and
Azusa Pacific University (with emphasis in Business Management) and completed
a two year tour in the United States Air Force. Mr. Fencl became a chief
financial officer and a director on October 31, 1999. He will serve as a
director until the next scheduled meeting of shareholders in January,
2001.
Trish R. Francis, Director and Secretary
Ms. Francis, age 53, has had an extensive business career
after completing two years of college; studying a variety of business
disciplines. Ms. Francis worked for prominent plastic surgeons, where she was
responsible for general office management to include detailed deciphering and
transcription of surgical records, enhancement of patient care
and all financial responsibilities. She managed a construction company
coordinating and implementing all facets, to include restructuring of the
entire organization and operating strategies.
After moving from Oklahoma to California in 1986, Ms.
Francis managed the Claremont Dental Clinic, supervising a group of
doctors and employees. Upon completion of an entire office reorganization,
her responsibilities took on a sophisticated management position.
From 1989 to 1999, Ms. Francis advanced her professional
career and talents in assuming a major role by undertaking vast
responsibilities for Keystone Investment Company, an international financial
consulting organization, to include executive administrative duties and
becoming the liaison between that office and the financial community.
Activities consisted of preparing legal documents for corporate
reorganizations and mergers. Ms. Francis also synchronized activities between
the various management, legal and accounting groups. Ms. Francis
became Secretary/Treasurer April 9, 1999 and became a director on May
27, 1999. She will serve as a director until the next scheduled meeting of
shareholders in January, 2001.
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information regarding
the beneficial ownership of the company's common stock following the proposed
organization, and as adjusted to reflect the sale of the units offered hereby,
by:
* each person who is known by the company to own more
than 5% of the company's outstanding common stock;
* each of the company's directors, naming them; and
* officers and directors of the company as a group.
Title of Name and Address Amount and Nature Percent of
Class of Beneficial Owner of Beneficial Owner Class
Common
Shares Frank J. Weinstock 317,100 Shares(1) 56%
3525 Sunset Lane
Oxnard, CA 93035
Trish R. Francis 22,800 Shares(2) 4%
3525 Sunset Lane
Oxnard, CA 93035
David G. Lilly 55,000 Shares 10%
8833 Sunset Blvd.
Suite 200
West Hollywood,
Calif. 90069
Total number of shares
owned by officers
and directors: 339,900 Shares 60%
Total number of shares
to be owned by officer
and directors when all
units are sold: 339,900 Shares 39%
Total shares to be issued
and outstanding when all
units are sold: 869,000 Shares 100%
(1) Includes 1,600 shares owned by the children of Frank J.
Weinstock.
(2) Includes 1,800 shares owned by the children of Trish R.
Francis.
DESCRIPTION OF SECURITIES
Each unit offered consists of 1,000 shares of common stock.
We are authorized to issue 10,000,000 shares of common
stock, $.001 par value.
As of 12/31/1999 569,000 shares were issued and outstanding.
Each share of common stock will be entitled to one vote,
either in person or by proxy, on all matters that may be voted upon by
the owners thereof at meetings of the stockholders.
The holders of common stock
* will have equal ratable rights to dividends from
funds legally available thereof, when, as and if declared by our
Board of Directors;
* will be entitled to share ratably in all of the
assets of our company available for distribution to holders of
common stock upon liquidation, dissolution or winding up
of the affairs of the company; and
* will not have preemptive or redemption provision
applicable thereto.
All shares of common stock which are the subject of this
offering, when issued, will be fully paid and non-assessable, with no
personal liability to the ownership thereof.
Our holders of shares of common Stock do not have cumulative
voting rights.
At the completion of this offering, if all units are sold,
affiliates, officers and/or directors of our company will own
approximately 47% of the then outstanding common stock.
TRANSFER AGENT
We will initially act as our own stock transfer agent.
REPORTS TO STOCKHOLDERS
We intend to furnish its stockholders with annual reports
containing audited financial information.
INTEREST OF NAMED EXPERTS AND COUNSEL
No counsel or experts have been hired to give opinions on
any matters concerning this offering. The Lance Kerr Law Office has received
50,000 shares of common stock for their work in completing the
registration process relating to these shares. These shares were issued and
delivered prior to the filing of this registration statement. The Lance
Kerr Law Office will render an opinion regarding the shares being
registered in this offering.
DISCLOSURES OF COMMISSION POSITION OF INDEMNIFICATION FOR
SECURITIES ACTS LIABILITIES
Section 17-16-851 of the Wyoming Statutes authorizes a
corporation's board of directors to grant indemnification to directors and
officers in terms sufficiently broad to permit such indemnification under some
circumstances for liabilities, including reimbursement for expenses incurred,
arising under the Securities Act of 1933, as amended. To the extent that
indemnification for liabilities arising under the Securities Act may be
permitted to our directors, officers and controlling persons under the
foregoing provisions, the company has been advised that in the opinion of
the Securities and Exchange Commission indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
Article V, Section 1, of the company bylaws provides for mandatory
indemnification of its directors to the maximum extent permitted by the
Wyoming Corporation Act and permissible indemnification of officers and
employees.
ORGANIZATION WITHIN LAST FIVE YEARS
Frank J. Weinstock may be considered a promoter. We have
entered into a five year employment agreement at an annual
compensation of $ 150,000 beginning November 1, 1999.
DESCRIPTION OF BUSINESS
Strategic Partners, Inc. was created to provide wide
ranging financial services to successful private companies who are
considering the public equity market as a means of enhancing their
expansion and growth. Our officers and directors have over 50 years
experience in equity financing and the public stock markets.
With the continuing consolidation of national brokerage organizations
and investment banking institutions access to the equity markets is
limited to only the largest multinational corporations. At the same time
the meteoric rise in the internet as a trading and investment medium has
changed the complexion of trading securities and investments forever.
Small successful private companies which could utilize equity
capital to produce and accelerate earnings are excluded from the major firms
because of their size. Their relatively small capital requirements do not
qualify them for traditional entry into the national equity markets. The
recent surge in equity offerings by internet related companies has meant that
many quality private companies are being ignored by the traditional
investment banking organizations because they do not have a thriving
business whose name ends in ".com". This exclusion from the nation's
equity markets stifles the expansion and potential growth of many emerging
companies who may have outstanding internal growth rates and profitability
but are being eliminated because they are not engaged in e-commerce.
Strategic Partners, Inc. intends to show such companies the means by
which they can access investment capital. We will provide professional
advice to the principals of these companies as to the proper procedures
for taking advantage of the potential benefits while avoiding the
inherent risks of the equity marketplace.
Strategic Partners, Inc. will establish a national
network of broker-dealers, market makers, venture capitalists and investors
interested in assisting well managed companies to access the equity markets
and attain greater success. In addition the Company is developing skills in
using the power of the internet as a way of communicating investment
opportunities to millions of potential investors.
This network will consist of representatives from regional
brokerage houses and individual accredited investors who share
the Company's belief that the equity marketplace can provide a
significant benefit to emerging companies which have a successful history of
operations but need additional capital to achieve their true potential. The
Company will provide an interface between this network and the companies
seeking access to the national equity markets. Many companies who could
benefit from access to capital sources have no idea of how to gain
acceptance or be effective once operating in the equity market place.
Many companies are unaware of the new opportunities available
every day for accessing investment capital by use of the internet. We were
organized to provide businesses with competent and professional advice on
the equity market place and assist those companies in benefitting
from access to that resource. Our business will consist of services to
clients for fees. We intend to provide services to clients who are planning
on becoming public companies either through initial public offerings or
mergers with existing public companies.
We will develop relationships with ongoing financial
organizations in addition to marketing a unique concept on the
internet. We will charge fees for other services rendered. We intend to
establish a website that will advertise the existence of the Company and
the services we provide. We have registered the domain name
"strategic-partners-inc.com" for this purpose. We intend to
solicit business through referrals by persons or entities known
to our officers and directors.
We will initially be at a competitive disadvantage we are a
new company with no track record of providing such services to
business clients as Strategic Partners, Inc. Our directors have
individually and collectively extensive years of operating history with an
impressive track record of being success oriented in the financial
marketplace. The expertise, skills and talents of these individuals will help
to create a stronger and healthier company during it's embryonic
development stages. There are many firms engaged in the same business who are
larger, more well established and who have a base of existing clients and
referral sources. We intend to compete against these other businesses by
offering high quality services at competitive prices.
Client fees earned by us will be predicated upon
performance. Providing capital resources to assist companies in obtaining
funds by which to conduct business operations will be a primary function.
In such cases, until we produce the desired result, we will be required
to pay our operating overhead. The time to achieve such a revenue
stream will vary. We expect to begin generating cash flow between three
to nine months from the conclusion of this offering. We will use
written agreements to contract for our services and will collect
a portion of our fees in advance to alleviate collection problems.
Initially, until a track record is established, we will engage in activities
involving only a few select clients. We have been advised by legal counsel
that
we will not be required to register as an investment adviser as we are
not engaged in rendering investment advice to the public. Further we
have been advised that we will not be required to register as a
investment company or mutual fund as we will not be investing capital in
securities of other companies and holding the same in investment accounts
for our shareholders.
We will use the experience of our officers and directors to
screen prospective clients so that management's time will be
devoted to those projects where there is a high likelihood of success. We have
entered into a five year management contract with Frank J.
Weinstock the President. This will help insure that the services of Mr.
Weinstock will be available on a long term basis. We intend to build a
strong and reputable organization employing proven professionals capable
of servicing all components of our business. It will be difficult to obtain
the services of other professionals until we have reached the point
of having sufficient income to offer competitive salaries and benefits to
qualified persons.
There is no governmental regulation of the providing of
consulting services to businesses and thus no governmental
approvals are needed to engage in business. Our services will initially be
limited to advice and analysis of a client's position relative to its
chances of success in the public market. We know of no plans to regulate the
dispensing of business advice to clients in the area of finance
or providing advice on structure of offerings to the public by our
clients.
During our initial stages we raised money from private
investors for operations. We have engaged in extensive research
in the last 22 months to assemble a business strategy enabling us to
stay abreast of changes occurring in the public markets and assessing
the impact of the internet on the securities business. This research
consisted of attending seminars and public meetings on the topic of investing
in internet and ".com" companies, utilizing the internet for raising
capital for businesses, examination of new and emerging methods of
accessing sources of capital using the internet.
The principals read extensively in the financial press and
consulted various websites of other firms who report on internet
related activities as they occur. Sources that were reviewed
included companies such as ETrade, offroadcapital.com, garage.com,
direct stock market (dsm.com), and similar ventures. The principals
attended seminars where the principals of some of these companies
expressed their views about changes that were occurring in the capital
markets. In the last 22 months the stock market has sponsored numerous
IPO's for internet and ".com" type businesses. Some of these have
been very successful and others less so. The principals have studied
some of these offering and tried to identify those factors that have
helped make the offering of stock using the internet successful so those
techniques and procedures could be applied to clients of our company.
The last 22 months has seen a dramatic rise in the stock of
technology and internet related companies. The Company has reviewed the SEC
Rules that have appeared to support the use of the internet to disseminate
information about new companies and the raising of capital. We have reviewed
the recent changes by the North American Securities Administrators
Association which have attempted to co-ordinate the efforts of states to make
the flow of information more efficient. We have reviewed the uses of SCOR
offerings for small business and have tried to determine those factors that
have made them workable in the public market.
We have reviewed the ACE-Net system of using the internet for raising
capital as well as the experiences of various angel groups in investing
in emerging companies. We have studied the feasibility of establishing
our own angel group consisting of an assemblage of wealthy investors who
are interested in investing in companies that are going public in the near
term. Our principals have spoken to representatives of establishment and
regional broker dealer firms to identify trends, problems and opportunities
as they evolve in the changing public market place relating to emerging
growth companies.
We will not engage in any of the following activities that
would subject us to being licensed as a broker-dealer, investment
company or investment adviser:
* We will not receive compensation based on securities
transactions.
* We will not solicit customers for issuers.
* We will not handle funds or securities in connection with
securities transactions.
* We will not participate in negotiations for securities
transactions.
* We will not provide investment advice to prospective buyers
of securities.
There are no environmental laws that directly affect our
business and thus we do not face any cost of compliance.
We presently employ two persons on a full time basis, the
President Frank J. Weinstock and the Secretary, Trish R. Francis.
There are no other current employees.
We plan to file reports with the SEC following the offering
on Form 10-K for annual reports and Form 10-Q for quarterly reports.
Copies of the annual report will be mailed to the shareholders.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE PLAN OF OPERATION
If we sell the maximum units that are being registered under
the registration statement we will have sufficient cash to
operate for the next 12 months. If less is sold the scale of operations
will be scaled down accordingly. We believe that the income to be generated
is a direct result of the amount of sales effort that is expended to
secure clients. The primary goal is to have sufficient cash to open an
office and have support staff that will support the sales efforts of the
officers and directors of the company. With proper support the company
will be able to carry out business in a profitable manner. The first
milestone the company hopes to achieve with this offering is the raising of
at least $ 300,000. This will allow for the opening of an office with
minimal staff. If the maximum units are sold we will lease offices and
purchase adequate equipment to facilitate business operations. The budget
for such an operation is set forth in the use of proceeds section of the
prospectus.
The second milestone is to generate income from fees of not less
than $300,000 for the first year. This level of income will allow the
company to continue in business and expand on this base. We have
identified potential clients that will generate fee income that will allow
achievement of our financial objectives in the first year of operations
following this offering. We will consider hiring additional professional
assistance on an "as needed" basis. We will hire a speciality firm to
design an appropriate website.
DESCRIPTION OF PROPERTY
We do not own any material property. We lease our
current office on a month to month basis from Valley N' Shores at
the rate of $ 900 per month. Our President, Mr. Weinstock owns office
furniture, telephones, computers and fax and other related equipment which
he allows us to use at no cost.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Since inception we issued 50,000 shares valued at $ 12,500
to the Lance Kerr Law Office for services and 6,000 shares valued
at $ 1,500 to Trish R. Francis for services.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There is currently no trading market for our shares. We
plans to apply for trading privileges in the near future.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Summary of Cash and Certain Other Compensation
The following table sets forth the compensation earned by the
Executive Officers which includes only the Chief Executive Officer.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term
1999 Annual Compensation
Compensation Awards
Number of
Securities
Underlying
Name and Principal Position(s) Salary Bonus Options
<S> <C> <C> <C>
Frank J. Weinstock...................$100,000(1) $ 0 0
President, Chief Executive
Officer and Chairman of
the Board of Directors
(1) Mr. Weinstock's compensation was $ 100,000 for the year ended
December 31, 1999. On January 1, 2000 Mr. Weinstock's
compensation increased to $ 150,000 per year.
</TABLE>
Stock Options and Stock Appreciation Rights
We have granted no options and has no plans for doing so in
the near future. We have granted no stock appreciation rights has no
plans for doing so in the near future.
FINANCIAL STATEMENTS
Audited Financial Statements for the Company as of
December 31, 1999 are attached as Pages F-1 to F-13.
Unaudited Financial Statements for the Company as of
June 30, 2000 are attached as Pages F-14 to F- .
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
December 31, 1999
F-1
C O N T E N T S
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . F 3
Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . F 4
Statements of Operations . . . . . . . . . . . . . . . . . . . . . . F 5
Statements of Stockholders' Equity (Deficit) . . . . . . . . . . . . F 6
Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . F 8
Notes to the Financial Statements. . . . . . . . . . . . . . . . . . F 9
F-2
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Strategic Partners, Inc.
(A Development Stage Company)
Oxnard, California
We have audited the accompanying balance sheets of
Strategic Partners, Inc. (a development stage company) as of December 31,
1999 and the related statements of operations, stockholders' equity
(deficit) and cash flows for the years ended December 31, 1999 and 1998
and from inception on September 25, 1998 through December 31, 1999.
These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally
accepted auditing standards. Those standards require that we plan and
perform the 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. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of
Strategic Partners, Inc. (a development stage company) as of December 31,
1999 and the results of its operations and its cash flows for the years
ended December 31, 1999 and 1998 and from inception on September
25, 1998 through December 31, 1999 in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared
assuming the Company will continue as a going concern. As discussed in
Note 3 to the financial statements, the Company is a development stage
company with no operating capital which raises substantial doubt about its
ability to continue as a going concern. Management's plans in regard to
these matters are also described in Note 3. The financial statements do not
include any adjustments that might result from the outcome of this
uncertainty.
/s/ Jones, Jensen & Company
Jones, Jensen & Company
Salt Lake City, Utah
April 25, 2000
F-3
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Balance Sheets
December 31,
1999
CURRENT ASSETS
Cash $ 386
-----
Total Current Assets 386
-----
TOTAL ASSETS $ 386
=====
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 64,646
Accrued interest (Note 5) 38
Note Payable (Note 5) 5,000
-------
Total Current Liabilities 69,684
-------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $0.001 par value;
10,000,000 shares authorized;
569,000 shares issued
and outstanding 569
Additional paid-in capital 559,297
Deficit accumulated during
the development stage (629,164)
---------
Total Stockholders'
Equity (Deficit) (69,298)
---------
TOTAL LIABILITIES AND
STOCKHOLDERS'
EQUITY (DEFICIT) $ 386
========
The accompanying notes are an integral part of these financial
statements.
F-4
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Operations
From
Inception on
For the September 25,
Years Ended 1998 Through
December 31, December 31, Decemberr 31,
1999 1998 1999
REVENUES $ - $ - $ -
EXPENSES
General and
administrative 365,113 264,556 629,669
---------- --------- ---------
(LOSS) FROM OPERATIONS (365,113) (264,556) (629,669)
OTHER INCOME
Interest expense (38) - (38)
Miscellaneous income 543 - 543
---------- -------- --------
Total Other Income 505 - 505
---------- -------- --------
NET (LOSS) $ (364,608) $ (264,556) $ (629,164)
========= ======== =========
BASIC (LOSS)
PER SHARE $ (0.94) $ (1.27)
========= ========
The accompanying notes are an integral part of these financial statements.
F-5
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Deficit
Accumulated
Additional During the
Common Stock Paid-In Development
Shares Amount Capital Stage
At inception on
September 25, 1998 - $ - $ - $ -
Common stock issued
for services at
$1.00 per share,
October 9, 1998 215,000 215 214,785 -
Common stock issued
for cash at $1.00
per share, October
12, 1998 2,000 2 1,998 -
Common stock issued
for cash and services
at $1.00 per share,
October 13, 1998 4,000 4 3,996 -
Common stock issued
for services at
$1.00 per share,
October 19, 1998 5,000 5 4,995 -
Common stock issued
for cash and services
at $1.00 per share,
October 30, 1998 10,000 10 9,990 -
Common stock issued
for cash at $1.00
per share,
November 17, 1998 6,000 6 5,994 -
Common stock issued
for cash at $1.00
per share,
November 24, 1998 3,000 3 2,997 -
Common stock issued
for cash, services
and expenses at
$1.00 per share,
December 8, 1998 21,000 21 20,979 -
Less stock
offering costs - - (534) -
Net (loss) for
the period ended
December 31, 1998 - - - (264,556)
------- ---- ------- ---------
Balance, December
31, 1998 266,000 266 265,200 (264,556)
Common stock issued
for expenses at
$1.00 per share,
January 5, 1999 300 - 300 -
Common stock issued
for cash and
services at
$1.00 per share,
January 16, 1999 12,50 13 12,487 -
Common stock issued
for cash at $1.00
per share,
January 20, 1999 20,000 20 19,980 -
Common stock issued
for cash at $1.00
per share,
February 3, 1999 1,000 1 999 -
Common stock issued
for cash at
$1.00 per share,
February 15, 1999 2,200 2 2,198 -
----- ---- -------- ----------
The accompanying notes are an integral part of these financial statements.
F - 6
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
Deficit
Accumulated
Additional During the
Common Stock Paid-In Development
Shares Amount Capital Stage
Balance Forward 302,000 $ 302 $ 301,164 $ (264,556)
Common stock issued
for cash at
$1.00 per share,
February 22, 1999 2,000 2 1,998 -
Common stock issued
for cash at
$1.00 per share,
March 12, 1999 6,400 6 6,394 -
Common stock issued
for cash and
services at
$1.00 per share,
March 26, 1999 27,500 27 27,473 -
Common stock issued
for cash at
$1.00 per share,
May 10, 1999 1,000 1 999 -
Common stock issued
for cash and
services at
$1.00 per share,
May 19, 1999 6,000 6 5,994 -
Common stock issued
for services
at $1.00 per share,
July 12, 1999 2,000 2 1,998 -
Common stock issued
for services
at $1.00 per share,
July 27, 1999 1,600 2 1,598 -
Common stock issued
for cash and services
at $1.00 per share,
August 3, 1999 1,000 1 999 -
Common stock issued
for services
at $1.00 per share,
August 10, 1999 1,500 2 1,498 -
Common stock issued
for cash at
$1.00 per share,
September 17, 1999 12,500 12 12,488 -
Common stock issued
for cash and
services at
$1.00 per share,
October 1, 1999 193,500 194 193,306 -
Common stock issued
for cash and services
at $1.00 per share,
October 26, 1999 11,000 11 10,989 -
Common stock issued
for services at
$1.00 per share,
October 29, 1999 1,000 1 999 -
Less stock
offering costs - - (8,600) -
Net (loss) for
the year ended
December 31, 1999 - - - (364,608)
----- ----- -------- ---------
Balance,
December 31, 1999 569,000 $ 569 $ 559,297 $ (629,164)
======= ======== ========= ============
The accompanying notes are an integral part of these financial
statements.
F - 7
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Cash Flows
From
For the Inception on
Years Ended September 25,
December 31 1998 Through
December 31,
1999 1998 1999
CASH FLOWS FROM
OPERATING ACTIVITIES
Loss from operations $ (364,608) $ (264,556) $ (629,164)
Adjustments to
reconcile net loss to
net cash (used)
by operating activities:
Common stock issued
for services 193,300 243,000 436,300
Changes in assets
and liabilities:
Increase (decrease)
in accounts payable 64,646 - 64,646
Increase in accrued interest 38 - 38
-------- ------- --------
Net Cash (Used)
by Operating Activities (106,624) (21,556) (128,180)
-------- ------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES - - -
-------- -------- ---------
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from notes payable 5,000 - 5,000
Issuance of common
stock for cash 109,700 23,000 132,700
Stock offering costs (8,600) (534) (9,134)
--------- --------- ----------
Net Cash Provided
by Operating Activities 106,100 22,466 128,566
---------- --------- ---------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (524) 910 386
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 910 - -
---------- --------- --------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 386 $ 910 386
========== ========== ==========
Cash Paid For:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
The accompanying notes are an integral part of these financial statements.
F - 8
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Strategic Partners, Inc. (a development stage company) (the
Company) was organized under the laws of the State of Wyoming on September 25,
1998. The purpose of the Company is to engage in the business of investment
banking. The Company has had no active operations from inception.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has elected a December 31 year end.
b. Provision for Taxes
No provision for income taxes has been made due to the inactive
status of the Company. The Company has a net operating loss carryover at
December 31, 1999 of approximately $629,000 which expires in 2019. The
potential tax benefit of the loss carryover has been offset by a valuation
allowance of the same amount.
c. Cash Equivalents
The Company considers all highly liquid investments with a
maturity of three months or less when purchased to be cash equivalents.
d. 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 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.
e. Revenue Recognition Policy
The Company currently has no source of revenues. Revenue recognition
policies will be determined when principal operations begin.
F - 9
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
f. Basic (Loss) Per Share
The following is an illustration of the reconciliation of the
numerators and denominators of the basic loss per share calculation:
For the
Years Ended
December 31,
1999 1998
Net loss (numerator) $ (364,608) $ (264,556)
Weighted average shares outstanding
(denominator) 388,930 207,876
Basic loss per share $ (0.94) $ 1.27)
Dilutive loss per share is not presented as there are no potentially
dilutive items outstanding.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities in the
normal course of business. The Company has not established revenues
sufficient to cover its operating costs and allow it to continue as a
going concern. It is the intent of the Company to earn revenues from
investment banking services. Until sufficient revenues are earned to
operate profitably, management intends to issue additional shares of its
common stock for cash, services, or expenses paid on behalf of the Company.
NOTE 4 - RELATED PARTY TRANSACTIONS
The Company pays rent of $900 per month on a month-to-month basis
for office space in the personal residence of a related party. Rent expense
for the year ended December 31, 1999 was $10,800.
The Company agreed to pay its Chief Executive Officer $7,500 per
month as
compensation for January through October 1999. Compensation
expense
associated with this agreement amounted to $75,000 for the year
ended
December 31, 1999.
During October 1999, the Company signed an employment contract
with its Chief Executive Officer, whereby, the Company agreed to pay him
$150,000 per year for five years. Compensation expense associated with this
contract amounted to $25,000 for the year ended December 31, 1999.
F - 10
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999
NOTE 4 - RELATED PARTY TRANSACTIONS (Continued)
The Company agreed to pay its Secretary $2,500 per month as
compensation. Compensation expense associated with this agreement amounted to
$30,000 for the year ended December 31, 1999.
NOTE 5 - NOTE PAYABLE
On December 3, 1999, the Company signed a promissory note for
$5,000. The note has a maturity date of June 3, 2000 and accrues
interest at 10% per annum, unsecured. At December 31, 1999, the
unpaid principal balance was $5,000 and accrued interest payable under
the note amounted to $38.
NOTE 6 - ISSUANCE OF STOCK
During October 1998, the Company issued 215,000 shares of its
previously authorized, but unissued, common stock for services of
$215,000 (or $1.00 per share).
During October 1998, the Company issued 2,000 shares of its
previously authorized, but unissued, common stock for cash of $2,000 (or
$1.00 per share).
During October 1998, the Company issued 4,000 shares of its
previously authorized, but unissued, common stock for cash of $2,000 and
services of $2,000 (or $1.00 per share).
During October 1998, the Company issued 5,000 shares of its
previously authorized, but unissued, common stock for services of $5,000 (or
$1.00 per share).
During October 1998, the Company issued 10,000 shares of its
previously authorized, but unissued, common stock for cash of $5,000 and
services of $5,000 (or $1.00 per share).
During November 1998, the Company issued 6,000 shares of its
previously authorized, but unissued, common stock for cash of $6,000 (or
$1.00 per share).
During November 1998, the Company issued 3,000 shares of its
previously authorized, but unissued, common stock for cash of $3,000 (or
$1.00 per share).
During December 1998, the Company issued 5,000 shares of its
previously authorized, but unissued, common stock for cash of $5,000 (or
$1.00 per share).
F - 11
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999
NOTE 6 - ISSUANCE OF STOCK (Continued)
During December 1998, the Company issued 16,000 shares of its
previously authorized, but unissued, common stock for services of $16,000
(or $1.00 per share).
During January 1999, the Company issued 300 shares of its
previously authorized, but unissued, common stock for services of $300 (or
$1.00 per share).
During January 1999, the Company issued 12,500 shares of its
previously authorized, but unissued, common stock for cash of $6,000 and
services of $6,500 (or $1.00 per share).
During January 1999, the Company issued 20,000 shares of its
previously authorized, but unissued, common stock for cash of $20,000 (or
$1.00 per share).
During February 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for cash of $1,000 (or
$1.00 per share).
During February 1999, the Company issued 2,200 shares of its
previously authorized, but unissued, common stock for cash of $2,000 and
services of $200 (or $1.00 per share).
During February 1999, the Company issued 2,000 shares of its
previously authorized, but unissued, common stock for cash of $2,000 (or
$1.00 per share).
During March 1999, the Company issued 6,400 shares of its
previously authorized, but unissued, common stock for cash of $5,000
and services of $1,400 (or $1.00 per share).
During March 1999, the Company issued 27,500 shares of its
previously authorized, but unissued, common stock for cash of $25,000 and
services of $2,500 (or $1.00 per share).
During May 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for cash of $1,000
(or $1.00 per share).
During May 1999, the Company issued 6,000 shares of its
previously authorized, but unissued, common stock for cash of $5,000 and
services of $1,000 (or $1.00 per share).
During July 1999, the Company issued 2,000 shares of its
previously authorized, but unissued, common stock for services of $2,000
(or $1.00 per share).
During July 1999, the Company issued 1,600 shares of its
previously authorized, but unissued, common stock for services of $1,600
(or $1.00 per share).
During August 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for cash of $200 and
services of $800 (or $1.00 per share).
F - 12
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999
NOTE 6 - ISSUANCE OF STOCK (Continued)
During August 1999, the Company issued 1,500 shares of its
previously authorized, but unissued, common stock for services of $1,500 (or
$1.00 per share).
During September 1999, the Company issued 12,500 shares of its
previously authorized, but unissued, common stock for cash of $12,500 (or
$1.00 per share).
During October 1999, the Company issued 193,500 shares of its
previously authorized, but unissued, common stock for cash of $20,000 and
services of $173,500 (or $1.00 per share).
During October 1999, the Company issued 11,000 shares of its
previously authorized, but unissued, common stock for cash of $10,000 and
services of $1,000 (or $1.00 per share).
During October 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for services of $1,000 (or
$1.00 per share).
Stock offering costs of $8,600 were offset to additional paid-in
capital during 1999.
F - 13
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Balance Sheets
June 30, December 31,
2000 1999
(Unaudited)
CURRENT ASSETS
Cash $ 42,503 $ 386
------ ----
Total Current Assets 42,503 386
------ ----
FIXED ASSETS, NET (Note 2) 1,476 -
------ ----
TOTAL ASSETS $ 43,979 $ 386
====== ====
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable-Related
Party (Note 4) $ 82,700 $ 64,646
Accrued interest (Note 5) 2,688 38
Note payable (Note 5) 58,700 5,000
------ -----
Total Current Liabilities 144,088 69,684
------- ------
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock, $0.001 par
value; 10,000,000 shares
authorized; 619,500 and
569,000 shares issued and
outstanding, respectively 620 569
Additional paid-in capital 647,746 559,297
Deficit accumulated during
the development stage (748,475) (629,164)
-------- -------
Total Stockholders' Equity
(Deficit) (100,109) (69,298)
--------- ------
TOTAL LIABILITIES AND
STOCKHOLDERS'
EQUITY (DEFICIT) $ 43,979 $ 386
======== ======
F - 14
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
From
Inception on
For the Six For the Three
September 25,
Months Ended Months Ended
1998 Through
June 30, June 30,
June 30,
2000 1999 2000 1999
2000 2000
<S> <C> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ - $ -
EXPENSES
General and
administrative 116,623 155,400 59,089 64,721 745,342
------- ------- ------- ------- -------
(LOSS) FROM OPERATIONS 116,623 (155,400) (59,089) (64,721) (745,342)
------- -------- -------- ------- -------
OTHER INCOME (EXPENSE)
Interest expense (2,688) - (950) - (3,676)
Miscellaneous income - - - - 543
------ ------ ------- ------- --------
Total Other Income
(Expense) (2,688) - (950) - (3,133)
------- -------- -------- -------- ---------
NET (LOSS) $ (119,311) (155,400) (60,039) $(64,721) (748,475)
======== ======== ======= =================
BASIC (LOSS)
PER SHARE $ (0.21) $ (0.49) $ (0.10) $ (0.19)
========= ======== ======== ========
</TABLE>
F- 15
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Deficit
Accumulated
Additional During the
Common Stock Paid-In Development
Shares Amount Capital Stage
At Inception on
September 25, 1998 - $ - $ - $ -
Common stock issued
for services at $1.00 per
share, October 9, 1998 215,000 215 214,785 -
Common stock issued
for cash at $1.00 per
share, October 12, 1998 2,000 2 1,998 -
Common stock issued
for cash and services at
$1.00 per share,
October 13, 1998 4,000 4 3,996 -
Common stock issued
for services at $1.00 per
share, October 19, 1998 5,000 5 4,995 -
Common stock issued
for cash and services at
$1.00 per share,
October 30, 1998 10,000 10 9,990 -
Common stock issued
for cash at $1.00 per
share, November 17, 1998 6,000 6 5,994 -
Common stock issued
for cash at $1.00 per
share, November 24, 1998 3,000 3 2,997 -
Common stock issued for
cash, services and
expenses at $1.00 per
share, December 8, 1998 21,000 21 20,979 -
Less stock offering costs - - (534) -
Net (loss) for the period
ended December 31, 1998 - - - (264,556)
------ ------ ------ -------
Balance, December 31, 1998 266,000 266 265,200 (264,556)
F- 16
<PAGE>
Common stock issued
for expenses at $1.00 per
share, January 5, 1999 300 - 300 -
Common stock issued for
cash and services at
$1.00 per share,
January 16, 1999 12,500 13 12,487 -
Common stock issued
for cash at $1.00 per
share, January 20, 1999 20,000 20 19,980 -
Common stock issued
for cash at $1.00 per
share, February 3, 1999 1,000 1 999 -
Common stock issued
for cash at $1.00 per
share, February 15, 1999 2,200 2 2,198 -
-------- ------- ------- --------
Balance Forward 302,000 $ 302 $ 301,164 $ (264,556)
F - 17
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
Deficit
Accumulated
Additional During the
Common Stock Paid-In Development
Shares Amount Capital Stage
Balance Forward 302,000 $ 302 $ 301,164 $ (264,556)
Common stock issued
for cash at $1.00 per
share, February 22, 1999 2,000 2 1,998 -
Common stock issued
for cash at $1.00 per
share, March 12, 1999 6,400 6 6,394 -
Common stock issued
for cash and services
at $1.00 per share,
March 26, 1999 27,500 27 27,473 -
Common stock issued
for cash at $1.00 per
share, May 10, 1999 1,000 1 999 -
Common stock issued
for cash and services
at $1.00 per share,
May 19, 1999 6,000 6 5,994 -
Common stock issued
for services at $1.00
per share, July 12, 1999 2,000 2 1,998 -
Common stock issued
for services at $1.00
per share, July 27, 1999 1,600 2 1,598 -
Common stock issued
for cash and services
at $1.00 per share,
August 3, 1999 1,000 1 999 -
Common stock issued
for services at $1.00 per
share, August 10, 1999 1,500 2 1,498 -
F- 18
<PAGE>
Common stock issued
for cash at $1.00 per
share, September 17, 1999 12,500 12 12,488 -
Common stock issued
for cash and services
at $1.00 per share,
October 1, 1999 193,500 194 193,306 -
Common stock issued
for cash and services
at $1.00 per share,
October 26, 1999 11,000 11 10,989 -
Common stock issued
for services at $1.00 per
share, October 29, 1999 1,000 1 999 -
Less stock offering costs - - (8,600) -
Net (loss) for the year
ended December 31, 1999 - - - (364,608)
-------- ----- -------- --------
Balance,
December 31, 1999 569,000 $ 569 $ 559,297 $ (629,164)
--------- ------- ---------- ------------
F-19
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit) (Continued)
Deficit
Accumulated
Additional During the
Cmmon Stock Paid-In Development
Shares Amount Capital Stage
Balance,
December 31, 1999 569,000 $ 569 $ 559,297 $ (629,164)
Common stock issued for
cash at $ 2.00 per share
May 22, 2000 (unaudited) 29,000 29 57,971 -
Common stock issued for
cash at $ 2.00 per share
May 25, 2000 (unaudited) 5,000 5 9,995 -
Common stock issued for
cash at $ 2.00 per share
June 1, 2000 (unaudited) 2,000 2 3,998 -
Common stock issued for
cash at $ 1.00 per share
June 3, 2000 (unaudited) 5,000 5 4,995 -
Common stock issued for
cash at $ 2.00 per share
June 15, 2000 (unaudited) 1,000 1 1,999 -
Common stock issued for
cash at $ 2.00 per share
June 23, 2000 (unaudited) 1,000 1 1,999 -
Common stock issued for
cash at $ 1.00 per share
June 30, 2000 (unaudited) 7,500 8 7,492
Net (loss) for the
sixe months ended
June 30, 2000
(unaudited) - - - (119,311)
--------- -------- -------- ---------
Balance,
June 30, 2000
(unaudited) 619,500 $ 620 $ 647,746 $ (748,475)
======== ======== =========== ============
F-20
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
From
Inception on
September 25,
For the Six Months For the Three Months 1998 Through
Ended June 30, Ended June 30, June 30,
2000 1999 2000 1999 2000
<S>
CASH FLOWS FROM
OPERATING ACTIVITIES
<C> <C> <C> <C>
<C>
Net loss $ (119,311) $ (155,440) $ (60,039) $ (64,721) $ (748,475)
Adjustments to
reconcile net
loss to net cash (used)
by operating activities:
Common stock issued
for services - 11,600 - 1,000 436,300
Changes in operating
assets and liabilities:
Increase (decrease)in
accounts payable 18,054 75,839 (2,663) 56,720 82,700
Increase in accrued
interest 2,650 - 1,700 - 2,688
------- ------ ------ ------ -------
Net Cash (Used) by
Operating Activities (98,607) (68,001) (61,002) (7,001) (226,787)
------- ------ ------- ------- --------
CASH FLOWS FROM
INVESTING ACTIVITIES
Purchase of Fixed Assets (1,476) - (1,476) - (1,476)
------- -------- ------- ------- --------
F- 21
<PAGE>
Net Cash (Used) by
Investing Activities (1,476) - (1,476) - (1,476)
------- -------- ------- ------- --------
CASH FLOWS FROM
FINANCING ACTIVITIES
Proceeds from notes
payable 66,200 - 15,700 - 71,200
Issuance of common
stock for cash 76,000 67,000 76,000 6,000 208,700
Stock offering costs - - - - (9,134)
------- ------- ------- ------- -------
Net Cash Provided by
Financing Activitis 142,200 67,000 91,700 6,000 270,766
------- ------- ------- ------- -------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 42,117 (1,001) 29,222 (1,001) 42,503
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 386 (910) 13,281 (910) -
------- ------- ------- ------- -------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 42,503 $ 91 $ 42,503 $ 91 $ 42,503
======= ======= ======= ======== =======
Cash Paid For:
Interest $ - $ - $ - $ - $ -
Income taxes $ - $ - $ - $ - $ -
</TABLE>
F-22
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000 and December 31, 1999
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
Strategic Partners, Inc. (a development stage company) (the Company)
was organized under the laws of the State of Wyoming on September 25,
1998. The purpose of the Company is to engage in the business of
investment banking. The Company has had no active operations from inception.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has elected a December 31 year end.
b. Provision for Taxes
No provision for income taxes has been made due to the inactive status
of the Company. The Company has a net operating loss carryover at June
30, 2000 of approximately $ 745,000 which expires in 2020. The potential
tax benefit of the loss carryover has been offset by a valuation
allowance of the same amount.
c. Cash Equivalents
The Company considers all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents.
d. 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
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.
e. Revenue Recognition Policy
The Company currently has no source of revenues. Revenue recognition
policies will be determined when principal operations begin.
F - 23
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000 and December 31, 1999
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
f. Basic (Loss) Per Share
The following is an illustration of the reconciliation of the numerators
and denominators of the basic loss per share calculation:
<TABLE>
For the For the
Six Months Ended Three Months Ended
June 30, June 30,
2000 1999 2000 1999
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net loss (numerator) $ (119,311) $ (155,400) $ (60,039) $ (64,721)
Weighted average shares
outstanding (denominator) 577,385 319,493 588,769 341,230
-------- -------- ------- --------
Basic loss per share $ (0.21) $ (0.49) $ (0.10) $ (0.19)
======== ======== ======= ========
Dilutive loss per share is not presented as there are
no potentially dilutive items outstanding.
</TABLE>
F - 24
< Page>
g. Fixed Assets
Fixed assets are recorded at cost. Major additions and improvements are
capitalized. Minor replacements, maintenance and repairs that do not
extend the useful life of th4e assets are expensed as incurred. Depreciation
of property and equipment is determined using the straight line method over
the useful lives, primarily from 5 to 7 years. Property and equipment
consisted of the following at:
June 30, December 31
2000 1999
Office equipment $ 1,476 $ -
------ ------
$ 1,476 $ -
====== ======
Depreciation expense for the six months ended June 30, 2000 and for the
year ended December 31, 1999 was $ 0 and $ 0, respectively.
h. Unaudited Financial Statements
The accompanying unaudited financial statements include all of the
adjustments which, in the opinion of management, are necessary for
a fair presentation. Such adjustments are of a normal recurring nature.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities
in the normal course of business. The Company has not established
revenues sufficient to cover its operating costs and allow it to
continue as a going concern. It is the intent of the Company to earn
revenues from investment banking services. Until sufficient revenues
are earned to operate profitably, management intends to issue additional
shares of its common stock for cash, services, or expenses paid on
behalf of the Company.
NOTE 4 - RELATED PARTY TRANSACTIONS
Office Space
The Company pays rent of $900 per month on a month-to-month basis for
office space in the personal residence of a related party. Rent
expense for the six months ended June 30, 2000 and 1999 was
$5,400 and $5,400, respectively.
F - 25
<PAGE>
STRATEGIC PARTNERS, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000 and December 31, 1999
NOTE 4 - RELATED PARTY TRANSACTIONS (Continued)
Accounts Payable
Accounts payable cconsits of unpaid consulting expenses for Chief
Executive Officer in the amount of $ 80,000 and rent for office space in
the amount of $ 2,700 at June 30, 2000.
Employment Agreements
The Company agreed to pay its Chief Executive Officer $7,500 per month as
compensation for January through October 1999. Compensation expense
associated with this agreement amounted to $45,000 for the six months
ended June 30, 1999.
During October 1999, the Company signed an employment contract with its
Chief Executive Officer, whereby, the Company agreed to pay him $150,000
per year for five years. Compensation expense associated with this contract
amounted to $75,000 and $-0- for the six months ended June 30, 2000
and 1999, respectively.
The Company agreed to pay its Secretary $2,500 per month as compensation.
Compensation expense associated with this agreement amounted to $15,000 and
$15,000 for the six months ended June 30, 2000 and 1999, respectively.
NOTE 5 - NOTE PAYABLE
On December 3, 1999, the Company signed a promissory note for $5,000.
The note has a maturity date of June 3, 2000 and accrues interest at
10% per annum, unsecured. During June, 2000, the holder of the note
elected to convert the principal amount of $ 5,000 to 5,000 shares
of common stock.
On January 12, 2000, the Company signed a convertible promissory note
for $3,000. The note has a maturity date of July 12, 2000 and accrues
interest at 10% per annum, unsecured. At June 30, 2000, the unpaid
principal balance was $3,000 and accrued interest payable under the
note amounted to $140.
On January 12, 2000, the Company signed a convertible promissory note
for $3,000. The note has a maturity date of July 12, 2000 and accrues
interest at 10% per annum, unsecured. At July 30, 2000, the unpaid
principal balance was $3,000 and accrued interest payable under the note
amounted to $140.
On January 12, 2000, the Company signed a convertible promissory note
for $3,000. The note has a maturity date of July 12, 2000 and accrues
interest at 10% per annum, unsecured. At June 30, 2000, the unpaid
principal balance was $3,000 and accrued interest payable under the
note amounted to $140.
F - 26
<PAGE>
On January 21, 2000, the Company signed a convertible promissory note
for $1,000. The note has a maturity date of July 21, 2000 and accrues
interest at 10% per annum, unsecured. At June 30, 2000, the unpaid
principal balance was $1,000 and accrued interest payable under the
note amounted to $44.
On January 24, 2000, the Company signed a convertible promissory note
for $12,500. The note has a maturity date of July 24, 2000 and accrues
interest at 10% per annum, unsecured. At June 30, 2000, the unpaid
principal balance was $12,500 and accrued interest payable under the
note amounted to $541.
NOTE 5 - NOTE PAYABLE (Continued)
On January 24, 2000, the Company signed a convertible promissory note for
$12,500. The note has a maturity date of July 24, 2000 and accrues interest
at 10% per annum, unsecured. At June 30, 2000, the unpaid principal
balance was $12,500 and accrued interest payable under the note amounted
to $541.
On February 10, 2000, the Company signed a convertible promissory note for
$5,000. The note has a maturity date of August 10, 2000 and accrues interest
at 10% per annum, unsecured. During June 2000, the holder of the note
elected to convert the principal amount of $ 5,000 to 5,000 shares of
common stock.
On February 18, 2000, the Company signed a convertible promissory note for
$2,500. The note has a maturity date of August 18, 2000 and accrues interest
at 10% per annum, unsecured. During June, 2000 the holder of the note
elected to convert the principal amount of $2,500 to 2,500 shares of
common stock.
On March 6, 2000, the Company signed a convertible promissory note for $2,500.
The note has a maturity date of September 6, 2000 and accrues interest
at 10% per annum, unsecured. At June 30, 2000, the unpaid principal
balance was $2,500 and accrued interest payable under the note amounted
to $79.
On March 6, 2000, the Company signed a convertible promissory note for $3,000.
The note has a maturity date of September 6, 2000 and accrues interest at
10% per annum, unsecured. At June 30, 2000, the unpaid principal balance
was $3,000 and accrued interest payable under the note amounted to $95.
On March 6, 2000, the Company signed a convertible promissory note for
$2,500. The note has a maturity date of September 6, 2000 and accrues
interest at 10% per annum, unsecured. At June 30, 2000, the unpaid
principal balance was $2,500 and accrued interest payable under the
note amounted to $79.
On April 12, 2000, the Company signed a convertible promissory note for $700.
The note has a maturity date of October 12, 2000 and accrues interest at 10%
per annum, unsecured. At June 30, 2000, the unpaid principal balance was $700
and accured interest payable under the note amounted to $54.
F - 27
<PAGE>
On April 18, 2000, the Company signed a convertible promissory note for
$15,000. The note has a maturity date of October 18, 2000 and accrues
interest at 10% per annum, unsecured. At June 30, 2000, the unpaid principal
balance was $15,000 and accured interest payable under the note amounted
to $ 300.
NOTE 6 - ISSUANCE OF STOCK
During October 1998, the Company issued 215,000 shares of its
previously authorized, but unissued, common stock for services
of $215,000 (or $1.00 per share).
During October 1998, the Company issued 2,000 shares of its
previously authorized, but unissued, common stock for cash of $2,000
(or $1.00 per share).
During October 1998, the Company issued 4,000 shares of its
previously authorized, but unissued, common stock for cash of $2,000
and services of $2,000 (or $1.00 per share).
During October 1998, the Company issued 5,000 shares of its
previously authorized, but unissued, common stock for services of
$5,000 (or $1.00 per share).
NOTE 6 - ISSUANCE OF STOCK (Continued)
During October 1998, the Company issued 10,000 shares of its
previously authorized, but unissued, common stock for cash of $5,000
and services of $5,000 (or $1.00 per share).
During November 1998, the Company issued 6,000 shares of its
previously authorized, but unissued, common stock for cash of $6,000
(or $1.00 per share).
During November 1998, the Company issued 3,000 shares of its
previously authorized, but unissued, common stock for cash of $3,000
(or $1.00 per share).
During December 1998, the Company issued 5,000 shares of its
previously authorized, but unissued, common stock for cash of $5,000
(or $1.00 per share).
During December 1998, the Company issued 16,000 shares of its
previously authorized, but unissued, common stock for services of
$16,000 (or $1.00 per share).
During January 1999, the Company issued 300 shares of its
previously authorized, but unissued, common stock for services of
$300 (or $1.00 per share).
During January 1999, the Company issued 12,500 shares of its
previously authorized, but unissued, common stock for cash of
$6,000 and services of $6,500 (or $1.00 per share).
F - 28
<PAGE>
During January 1999, the Company issued 20,000 shares of its
previously authorized, but unissued, common stock for cash of
$20,000 (or $1.00 per share).
During February 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for cash of
$1,000 (or $1.00 per share).
During February 1999, the Company issued 2,200 shares of its
previously authorized, but unissued, common stock for cash of
$2,000 and services of $200 (or $1.00 per share).
During February 1999, the Company issued 2,000 shares of its
previously authorized, but unissued, common stock for cash of
$2,000 (or $1.00 per share).
During March 1999, the Company issued 6,400 shares of its
previously authorized, but unissued, common stock for cash of
$5,000 and services of $1,400 (or $1.00 per share).
During March 1999, the Company issued 27,500 shares of its
previously authorized, but unissued, common stock for cash of
$25,000 and services of $2,500 (or $1.00 per share).
NOTE 6 - ISSUANCE OF STOCK (Continued)
During May 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for cash of
$1,000 (or $1.00 per share).
During May 1999, the Company issued 6,000 shares of its
previously authorized, but unissued, common stock for cash of
$5,000 and services of $1,000 (or $1.00 per share).
During July 1999, the Company issued 2,000 shares of its
previously authorized, but unissued, common stock for services
of $2,000 (or $1.00 per share).
During July 1999, the Company issued 1,600 shares of its
previously authorized, but unissued, common stock for services
of $1,600 (or $1.00 per share).
During August 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for cash of
$200 and services of $800 (or $1.00 per share).
During August 1999, the Company issued 1,500 shares of its
previously authorized, but unissued, common stock for services
of $1,500 (or $1.00 per share).
During September 1999, the Company issued 12,500 shares of its
previously authorized, but unissued, common stock for cash of
$12,500 (or $1.00 per share).
F - 28
<PAGE>
During October 1999, the Company issued 193,500 shares of its
previously authorized, but unissued, common stock for cash of
$20,000 and services of $173,500 (or $1.00 per share).
During October 1999, the Company issued 11,000 shares of its
previously authorized, but unissued, common stock for cash of
$10,000 and services of $1,000 (or $1.00 per share).
During October 1999, the Company issued 1,000 shares of its
previously authorized, but unissued, common stock for services of
$1,000 (or $1.00 per share).
Stock offering costs of $8,600 were offset to additional paid-in
capital during 1999.
During May and June 2000, the Company issued 38,000 shares of its
previously authorized, but unissued, common stock for cash of $76,000
(or $2.00 per share)(unaudited).
During June 2000, the Company issued 12,500 shares of its previously
authorized, but unissued, common stock for convertible debt of
$12,500 (or $1.00 per share)(unaudited).
F - 29
[/TABLE]
<PAGE>
Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
There are no changes in or disagreements with any prior
accountant. The current accountant was hired in 1999 to audit the
Company's books and records from inception.
Until February 15, 2001 (90 days after the effective date of the
registrations statement) all U.S. Dealers effecting transactions in the
registered securities may be required to deliver a prospectus.
END PROSPECTUS
Item 24. Indemnification of Directors and Officers.
Section 145 of the Wyoming Corporation Law authorizes a court
to award or a corporation's board of directors to grant
indemnification to directors and officers in terms sufficiently broad
to permit such indemnification under some circumstances for liabilities,
including reimbursement for expenses incurred, arising under the Securities
Act of 1933, as amended. To the extent that indemnification for liabilities
arising under the Securities Act may be permitted to directors, officers and
controlling persons of the Registrant under the foregoing provisions, the
Company has been advised that in the opinion of the Securities and Exchange
Commission indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. Article V, Section 1, of
the Company bylaws provides for mandatory indemnification of its directors to
the maximum extent permitted by the Wyoming Corporation Law and
permissible indemnification of officers and employees.
Item 25. Other Expenses of Issuance and Distribution.
The following table sets forth the costs and expenses, other
than underwriting discounts, payable by the Registrant in connection
with the offer and sale of the common stock being registered. All amounts are
estimates except the registration fee.
<TABLE>
<S>
<C>
Registration fee........................................ $ 167
NASD filing fee.............................................. 100
Blue Sky/NASD fees and expenses (including legal fees).....15,000
Accounting fees and expenses............................... 5,000
Other legal fees and expenses..............................10,000
Printing and engraving.....................................12,500
Miscellaneous...............................................5,000
Public Relations and Distribution..........................20,000
----------
Total..................................................$ 67,767
===========
</TABLE>
Item 26. Recent Sales of Unregistered Securities.
Between October 9, 1998 and October 29, 1999 we issued and
sold 569,000 shares of our common stock to 26 founders
and private investors for cash consideration and services
valued at $ 569,000. All investors were accredited.
The Company paid 5,600 shares as commissions to
five persons as fees for referring investors to the Company.
Other than the finders fees none of the foregoing transactions
involved any underwriters, underwriting discounts or
commissions, or any public offering. Our Company has been advised
that each transaction was exempt from the registration requirements of
the Securities Act by virtue of Section 4(2) thereof and
Regulation D promulgated thereunder. The recipients in such transaction
represented their intention to acquire the securities
for investment only and not with a view to or for sale in
connection with any distribution thereof. Appropriate legends were
affixed to the share certificates issued in such transactions. All
recipients had adequate access, through their relationships with the
Company, to obtain information about the Company.
Details of the private sale of securities is set forth in Note
6 to the Financial Statements.
Item 27. Exhibits.
Exhibit
No. Exhibit Name
3.1 Articles of Incorporation
3.2 By-laws
4.2 Specimen Common Stock Certificate
5.1 Opinion of Lance N. Kerr Law Office
10.1 Management Contract
23.1 Consent of Jones, Jensen & Company, independent
auditors
23.2 Consent of Lance. N. Kerr Law Office (included in
Exhibit 5.1)
27.1 Financial Data Schedule
