U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
Registration Statement on Form 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS Under Section 12 (b)or(g)
of the Securities Exchange Act of 1934
WASATCH WEB ADVISORS, INC.
------------------------
(Name of Small Business Issuer as specified in its charter)
UTAH 87-0638510
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(State or other jurisdiction of (Employer I.D. No.)
organization)
941 East 3665 South
Salt Lake City, Utah 84106
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(Address of Principal Executive Office)
Issuer's Telephone Number, including Area Code: (801) 231-6735
Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of each class Name of each exchange on which
to be registered each class is registered
NONE NONE
Securities registered pursuant to Section 12 (g) of the Exchange Act:
$0.01 Par Value Common Voting Stock
------------------------------------
Title of Class
DOCUMENTS INCORPORATED BY REFERENCE:
None.
<PAGE>
PART I
Item 1. Description of Business.
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Business Development.
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Organization, Charter Amendments and General History
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Wasatch Web Advisors, Inc., a Utah corporation (the "Company"), was
organized under the laws of the State of Utah on September 14, 1999. Copies of
the Company's Articles of Incorporation and Bylaws are attached hereto and are
incorporated herein by reference. See the Index to Exhibits, Part III, Item 1.
General History
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Prior to the Company's organization, it sold 200,000 "unregistered" and
"restricted" shares of common stock at $0.01 per share, with the Company having
received gross proceeds of $2,000.
Following the Company's organization, it conducted an offering of 800,000
shares of common stock at a price of $0.035 per share. This offering was
conducted under Rule 504 of Regulation D of the Securities and Exchange
Commission, and applicable provisions of Rule 144-14-25s of the Utah Division of
Securities, which provides for sales of securities by public solicitation to
"accredited investors." The offering was subsequently closed, with the Company
having received gross proceeds of $28,000.
This Registration Statement is being filed on a voluntary basis to allow
the Company to obtain quotations for its common stock on the OTC Bulletin Board
of the National Association of Securities Dealers, Inc. (the "NASD"). See the
heading "Effects of Existing or Probable Governmental Regulations."
Sales of "Unregistered" and "Restricted" Securities Over the Past Three
Years
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For information concerning sales of "unregistered" and "restricted"
securities during the past three years, see the caption "Recent Sales of
Unregistered Securities."
Business.
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The Company was organized to develop and market Internet web page design
and maintenance for companies that have not previously used the Internet to
market their goods and services.
Risk Factors
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EARLY STAGE OF DEVELOPMENT
The Company was formed in September, 1999, and is at a very early stage of
development. It is subject to all of the risks inherent in any new business.
These risks include:
The need for substantial capital to support its development
efforts; the need to attract and retain qualified personnel and
experienced management; losses associated with start-up; and
competition.
<PAGE>
LOSSES ASSOCIATED WITH START-UP
The Company was formed recently and has limited operating history. The
purchase of the necessary computer and office equipment and software requires
large up front expenditures and working capital during the initial start-up
period. The Company expects that its initial expenses will result in losses
early in its development. It cannot guarantee that it will become profitable
after it completes its initial purchases. See "Management's Discussion and
Analysis or Plan of Operation," Part I, Item 2.
FLUCTUATIONS IN QUARTERLY OPERATING RESULTS AND MARGINS; SEASONALITY OF
BUSINESS
The Company's operating results are likely to fluctuate in the future as a
result of a variety of factors, many of which will be outside the Company's
control. Some of these factors may include material reduction or cancellation of
major projects or the loss of a major client; the amount and timing of the
receipt of new business; timing of hiring or loss of personnel; the amount and
timing of the opening or closing of an office; the amount and the relative mix
of high-margin creative or strategy consulting projects as compared to lower
margin projects, capital expenditures and other costs relating to the expansion
of operations; the level of demand for web site development; the ability to
maintain adequate staffing to service clients effectively; the cost of
advertising and related media; the amount and timing of expenditures by clients
for professional services; the introduction of new products or services by
competitors; pricing changes in the industry; relative mix of lower cost
full-time employees versus higher cost independent contractors; technical
difficulties with respect to the use of the Internet; economic conditions
specific to Internet technology usage; government regulation and legal
developments regarding the use of the Internet; and general economic conditions.
The Company may also experience seasonality in its business, resulting in
diminished revenues as a consequence of decreased demand for professional
services during summer and year-end vacation and holiday periods. Due to all of
the foregoing factors, the Company's operating results in any given quarter may
fall below expectations. In such an event, any future trading price of the
Company's common stock would likely be materially and adversely affected.
EVOLVING BUSINESS MODEL
The Company and its prospects must be considered in light of the risks,
expenses and difficulties frequently encountered by companies in an early stage
of development, particularly companies in new and rapidly evolving markets such
as Internet solutions and services. Such risks for the Company include, but are
not limited to, an evolving business model. To address these risks the Company
must, among other things, develop strong business development and management
activities, develop the strength and quality of its operations, maximize the
value delivered to clients by the Company's Internet solutions, develop and
enhance the Company's brands, respond to competitive developments and attract,
retain and motivate qualified employees. There can be no assurance that the
Company will be successful in meeting these challenges and addressing such risks
and the failure to do so could have a material adverse effect on the Company's
business, financial condition, result of operations and prospects.
RISKS RELATED TO FUTURE ACQUISITIONS
A key component of the Company's growth strategy is expected to be the
acquisition of firms that meet the Company's goals for strategic growth. The
successful implementation of this strategy will depend on the Company's ability
to identify suitable acquisition candidates, acquire such companies on
acceptable terms and integrate their operations successfully with those of the
Company. There can be no assurance that the Company will be able to identify
additional suitable acquisition candidates or that the Company will be able to
acquire such candidates on acceptable terms. Moreover, in pursuing acquisition
opportunities, the Company may compete with other companies with similar growth
strategies, certain of which competitors may be larger and have greater
financial and other resources than the Company. Competition for these
acquisition targets may also result in increased prices of acquisition targets
and a diminished pool of companies available for acquisition. Acquisitions also
involve a number of other risks, including adverse effects on the Company's
reporting operating results from increases in goodwill, amortization, acquired
in-process technology, stock compensation expense resulting from newly hired
employees, the diversion of management attention, potential disputes with the
sellers of one or more acquired entities and the possible failure to retain key
acquired personnel. Lack of client satisfaction or performance problems with an
acquired firm could also have a material adverse impact on the reputation of the
Company as a whole, and any acquired subsidiary could significantly underperform
relative to the Company's expectations. For all of these reasons, the Company's
pursuit of an overall acquisition strategy or any individual pending or future
acquisition may have a material adverse effect on the Company's business,
financial condition, results of operations and prospects. Management expects
that, for the foreseeable future, shares of the Company's common stock will be
the sole consideration for any such acquisition. As the Company issues stock to
complete any future acquisition, existing shareholders will experience ownership
dilution.
<PAGE>
RISKS ASSOCIATED WITH FAILURE TO MANAGE GROWTH
At present, the Company's employees include and are limited to its
President, James Doolin, and Secretary, Alycia Anthony. Any expansion of the
Company's operations would place a significant strain on its limited personnel,
management and other resources. Depending on the success of its planned
operations, the Company may be required to attract, train, motivate and manage
new employees successfully and to develop operational, management and
information systems and controls. There can be no assurance that the Company's
systems, procedures or controls will be adequate to support its operations or
that its management will be able to achieve the rapid execution necessary to
exploit the market for the Company's business model. The failure to effectively
manage growth could have a material adverse effect on the Company's business,
financial condition, results of operation and prospects.
COMPETITION; LOW BARRIERS TO ENTRY
The market for Internet professional services is relatively new, intensely
competitive, rapidly evolving and subject to rapid technological change. The
Company expects competition to persist, intensify and increase in the future.
The Company's competitors can be divided into several groups: computer hardware
and service vendors, national advertising and media agencies, Internet
integrators and web presence providers, large information consulting service
providers, Internet and online service providers and software vendors. Many of
the Company's current and potential competitors have longer operating histories,
larger installed customer bases, longer relationships with clients and
significantly greater financial, technical, marketing and public relation
sources than the Company and could decide at any time to increase their resource
commitments to the Company's target market. In addition, the market for web site
development is relatively new and subject to continuing definition, and, as a
result, may better position the Company's competitors to compete in this market
as it matures. As a strategic response to changes in the competitive
environment, the Company may from time to time make certain pricing, service
technology or marketing decisions or business or technology acquisitions that
could have a material adverse effect on the Company's business, financial
condition, results of operations and prospects. Competition of the type
described above could materially adversely affect the Company's business,
results of operations, financial conditions and prospects.
In addition, the Company's ability to maintain future client relationships
and generate new clients will depend to a significant degree on the quality of
its services and its reputation among its clients and potential clients,
compared with the quality of its services provided by, and the reputations of,
the Company's competitors. To the extent the Company loses clients to its
competitors because of dissatisfaction with the Company's services or its
reputation is adversely affected for any other reason, the Company's business,
result of operations, financial conditions and prospects could be materially
adversely affected.
There are relatively low barriers to entry into the Company's business.
Because firms such as the Company rely on the skill of their personnel and the
quality of their client service, they have no patented technology that would
preclude or inhibit competitors from entering their markets. The Company is
likely to face additional competition from new entrants into the market in the
future. There can be no assurance that existing or future competitors will not
develop or offer services that provide significant performance, price, creative
or other advantages over those offered by the Company, which could have a
material adverse effect on its business, financial condition, results of
operations and prospects.
DEVELOPING INTERNET ECONOMY, MARKET FOR E-COMMERCE SOLUTIONS; UNPROVEN
ACCEPTANCE OF THE COMPANY'S SERVICES
A substantial portion of the Company's revenue is expected to be derived
from services that depend upon the adoption of Internet solutions by companies
to improve their business positioning and processes, and the continued
development of the World Wide Web, the Internet and e-commerce. The Internet may
not prove to be a viable commercial marketplace because of inadequate
development of necessary infrastructure, lack of development of complementary
products, implementation of competing technology, delays in the development or
adoption of new standards and protocols required to handle increased levels of
Internet activity, government regulation or other reasons. The Internet has
experienced, and is expected to continue to experience, significant growth in
the number of users and volume of traffic. There can be no assurance that the
Internet infrastructure will continue to be able to support the demands placed
on it by this continuous growth. Moreover, critical issues concerning the use of
Internet and e-commerce solutions (including security, reliability, cost ease of
deployment and administration and quality of service) remain unresolved and may
affect the growth of the use of such technologies to maintain, manage and
operate a business, expand product marketing, improve corporate communications
and increase business efficiencies. The adoption of Internet solutions for these
purposes, particularly by those individuals and enterprises that have
historically relied on traditional means, can be capital intensive and generally
requires the acceptance of a new way of conducting business and exchanging
information If critical issues concerning the ability of Internet solutions to
improve business positioning and processes are not resolved or if the
infrastructure is not developed, the Company's business, financial condition,
results of operations and prospects will be materially adversely affected.
<PAGE>
CONFLICTS OF INTEREST
Conflicts of interest are inherent in certain segments of the marketing
communications industry, particularly in advertising. The Company will not
likely be able to pursue potential advertising and other opportunities because
such opportunities will require the Company to provide services to direct
competitors of existing clients. In addition, the Company risks alienating or
straining relationships with existing clients each time the Company agrees to
provide services to even indirect competitors of existing Company clients.
Conflicts of interest may jeopardize the stability of revenues generated from
existing clients and preclude access to business prospects, either of which
developments could have a material adverse effect on the Company's business,
financial condition, results of operations and prospects.
RAPID TECHNOLOGY CHANGE
The market for Internet solutions and marketing services is characterized
by rapid technological change, changes in user and client requirements and
preferences, frequent new product and service introductions embodying new
processes and technologies and evolving industry standards and practices that
could render the Company's proposed service practices and methodologies
obsolete. The Company's success will depend, in part, on its ability to develop
services and solutions that address the increasingly sophisticated and varied
needs of its prospective clients, and respond to technological advances,
emerging industry standards, practices and competitive service offerings.
Failure to do so could result in the loss of existing customers or the inability
to attract and retain new customers, either of which developments could have a
material adverse effect on the Company's business, financial condition, results
of operations and prospects. There can be no assurance that the Company will be
successful in responding quickly, cost-effectively and sufficiently to these
developments. If the Company is unable, for technical, financial or other
reasons, to adapt in a timely manner in response to change in market conditions
or client requirements, its business, financial condition, result of operations
and prospects would be materially adversely affected.
POTENTIAL LIABILITY TO CLIENTS
Many of the Company's consulting engagements will involve the development,
implementation and maintenance of applications that are critical to the
operations of its clients' businesses. Its failure or inability to meet a
client's expectations in the performance of its services could injure the
Company's business reputation or result in a claim for substantial damages,
regardless of its responsibility for such failure. In addition, the Company will
possess technologies and content that may include confidential or proprietary
client information. Although the Company has implemented policies to prevent
such client information from being disclosed to unauthorized parties or used
inappropriately, any such unauthorized disclosure or use could result in a claim
for substantial damages. The successful assertion of one or more large claims
against the Company that are uninsured, exceed available insurance coverage or
result in changes to the Company's insurance policies, including premium
increases or the imposition of a large deductible or co-insurance requirements,
could adversely affect the Company's business, results of operations and
financial conditions. The Company does not currently have any "errors and
omissions" policies that would cover any such claim, and does not expect to
obtain any such insurance until it can pay for such coverage from revenues, as
to which there can be no assurance.
FUTURE CAPITAL NEEDS; UNCERTAINTY OF ADDITIONAL FINANCING
The Company currently anticipates that its available cash resources will be
sufficient to meet its presently anticipated working capital and capital
expenditure requirements for the next fiscal year. However, the Company may need
to raise additional funds in order to support expansion, develop new or enhanced
services and products, respond to competitive pressures, acquire complimentary
businesses or technologies or take advantage of unanticipated opportunities. The
Company's future liquidity and capital requirements will depend upon numerous
factors, including the success of its proposed service offerings and competing
technological and market developments. The Company may be required to raise
additional funds through public or private financing, strategic relationships or
other arrangements. There can be no assurance that such additional funding, if
needed, will be available on terms acceptable to the Company, or at all.
Furthermore, any additional equity financing may be dilutive to stockholders,
and debt financing, if available, may involve restrictive covenants, which may
limit the Company's operating flexibility with respect to certain business
matters. If additional funds are raised through the issuance of equity
securities, the percentage ownership of the stockholders of the Company will be
reduced, stockholders may experience additional dilution in net book value per
share and such equity securities may have rights, preferences or privileges
senior to those of the holder of the Company's common stock. If adequate funds
are not available on acceptable terms, the Company may be unable to develop or
enhance its services and products, take advantage of future opportunities or
respond to competitive pressures, any of which could have a material adverse
effect on its business, financial condition, results of operations and
prospects.
<PAGE>
GOVERNMENT REGULATION AND LEGAL UNCERTAINTIES
The Company is not currently subject to direct government regulation, other
than the securities laws and the regulations thereunder applicable to all
publicly owned companies, and laws and regulations applicable to businesses
generally, and there are currently few laws or regulations directly applicable
to access to or commerce on the Internet. However, due to the increasing
popularity and use of the Internet, it is likely that a number of laws and
regulations may be adopted at the local, state, national and international
levels with respect to issues such as user privacy, freedom of expression,
pricing of products and services, taxation, advertising, intellectual property
rights, information security or the convergence of traditional communication
services with Internet communications. For example, the Telecommunications Act
of 1996 (the "Telecommunications Act") imposes criminal penalties on anyone who
distributes obscene or indecent communications over the Internet. Although the
anti-indecency provisions of the Telecommunications Act have been declared
unconstitutional by the federal courts, the increased attention focused upon
these liability issues as a result of the Telecommunications Act could adversely
affect the growth of the Internet and therefore demand for the Company's
services. In addition, because the growth in the electronic commerce market,
Congress has held hearings on whether to regulate providers of services and
transactions in the electronic commerce market, which regulations could
negatively affect client demand for Internet solutions that facilitate
electronic commerce. Moreover, the adoption of any such laws or regulations may
decrease growth of the Internet, which could in turn decrease the demand for the
Company's services or increase cost of doing business or in some other manner
have a material adverse effect on the Company's business, financial conditions
results of operations or prospects. In addition, the applicability to the
Internet of existing laws governing issues such as property ownership,
copyrights and other intellectual property issues, taxation, libel and personal
property is uncertain. The vast majority of such laws were adopted prior to the
advent of the Internet and related technologies and, as a result, do not
contemplate or address the unique issues of the Internet and related
technologies. Changes to such laws intended to address these issues, including
some recently proposed changes, could create uncertainty in the marketplace
which could reduce demand for the Company's services or increase the cost of
doing business as a result of costs of litigation or increased service delivery
costs, or could in some other manner have a material adverse effect on the
Company's business, financial condition, results of operations and prospects.
CONCENTRATION OF STOCK OWNERSHIP
Five entities beneficially own a majority of the Company's outstanding
common stock. As a result, the entities will be able to exercise significant
influence over all matters requiring stockholder approval, including the
election of directors and approval of significant corporate transactions. Such
concentration of ownership may also have the effect of delaying or preventing a
change in control of the Company.
SUSCEPTIBILITY TO GENERAL ECONOMIC CONDITIONS
The Company's revenues and results of operations are subject to
fluctuations based upon general economic conditions. If there were to be a
general economic downturn or a recession in the United States, then the Company
expects that business enterprises, including its potential clients, likely will
substantially and immediately reduce their budgets. Any future clients of the
Company that have substantial overseas operations may also be adversely affected
by economic conditions in overseas markets such as the recent volatility in
Asian and Russian economies and Asian and Russian currency and securities
markets. In the event of such an economic downturn, the Company's business,
financial condition, results of operations and prospects may be materially and
adversely affected.
DIVIDENDS
The Company does not expect to pay dividends on its common stock in the
foreseeable future. Future dividends, if any, will depend upon the Company's
earnings, if any.
NO PUBLIC MARKET FOR THE COMPANY'S SECURITIES
There is no public market for the Company's securities. Although the
Company intends to submit for a quotation of its common stock on the OTC
Bulletin Board of the NASD, the Company can not guarantee that any public market
will develop for its securities or that, if any such market develops, it will be
maintained. As a result, stockholders may not be able to sell their shares
readily, if at all.
<PAGE>
AUDITOR'S "GOING CONCERN" OPINION
The independent auditor's report issued in connection with the audited
financial statements of the Company for the period ended december 31, 1999,
expresses "substantial doubt about its ability to continue as a going concern,"
due to the Company's status as a development stage company and its lack of
significant operations. See the index to financial statements, part f/s of this
registration statement.
DEPENDENCE ON MANAGEMENT
For the foreseeable future, the Company will be entirely dependent upon the
services of its officers and directors. The Company has no employment agreement
with its only employees, James Doolin and Alycia Anthony, and does not maintain
"key man" life insurance for them.
PENNY STOCK
The Company's common stock is "penny stock" as defined in Rule 3a51-1 of
the Commission. This designation may adversely affect the development of any
public market for the Company's shares of common stock or, if such a market
develops, its continuation. Broker-dealers are required to personally determine
whether an investment in "penny stock" is suitable for customers.
Penny stocks are securities (i) with a price of less than five dollars per
share; (ii) that are not traded on a "recognized" national exchange; (iii) whose
prices are not quoted on the NASDAQ automated quotation system (NASDAQ-listed
stocks must still meet requirement (i) above); or (iv) of an issuer with net
tangible assets less than $2,000,000 (if the issuer has been in continuous
operation for at least three years) or $5,000,000 (if in continuous operation
for less than three years), or with average annual revenues of less than
$6,000,000 for the last three years.
Section 15(g) of the 1934 Act, and Rule 15g-2 of the Commission require
broker-dealers dealing in penny stocks to provide potential investors with a
document disclosing the risks of penny stocks and to obtain a manually signed
and dated written receipt of the document before effecting any transaction in a
penny stock for the investor's account. Potential investors in the Company's
common stock are urged to obtain and read such disclosure carefully before
purchasing any shares that are deemed to be "penny stock."
Rule 15g-9 of the Commission requires broker-dealers in penny stocks to
approve the account of any investor for transactions in such stocks before
selling any penny stock to that investor. This procedure requires the
broker-dealer to (i) obtain from the investor information concerning his or her
financial situation, investment experience and investment objectives; (ii)
reasonably determine, based on that information, that transactions in penny
stocks are suitable for the investor and that the investor has sufficient
knowledge and experience as to be reasonably capable of evaluating the risks of
penny stock transactions; (iii) provide the investor with a written statement
setting forth the basis on which the broker-dealer made the determination in
(ii) above; and (iv) receive a signed and dated copy of such statement from the
investor, confirming that it accurately reflects the investor's financial
situation, investment experience and investment objectives. Compliance with
these requirements may make it more difficult for the Company's stockholders to
resell their shares to third parties or to otherwise dispose of them.
SALE OF "RESTRICTED" SHARES
All of the 1,142,857 shares of the Company's common stock are "restricted
securities" within the meaning of Rule 144 of the Securities Act of 1933, as
amended (the "1933 Act"). If a market for the Company's common stock ever
develops, these shares may be sold under Rule 144, and sales may
have a negative effect on the Company's stock price, if any.
PRINCIPAL PRODUCTS AND SERVICES
The Company has engaged in the business of Internet web page design for
small and medium-size companies.
RECENT PUBLIC ANNOUNCEMENTS
None; not applicable.
<PAGE>
DISTRIBUTION METHODS OF THE PRODUCTS OR SERVICES
The Company intends to outsource hosting its clients web sites to unrelated
third parties. The Company expects that these third parties will be able to host
an unlimited number of web sites.
Management plans to advertise the Company's services through mailings to
new businesses, principally in Utah. Information on new businesses is readily
available from various governmental agencies, such as Secretaries of State and
local business licensing offices. The Company also plans on advertising direct
to future clients through its own web site.
The Company has budgeted $2,000 to $4,000 in advertising costs during its
first year of operation. These funds will come principally from the net proceeds
of its recent securities offering and then, if the Company receives sufficient
revenue, from operating revenues. There can be no assurance that the Company
will receive sufficient operating revenues to meet its intended advertising
budget; if it is not successful in this regard, the Company may be unable to
attract a sufficient number of new clients to allow its business to continue.
COMPETITIVE BUSINESS CONDITIONS
The communications and information services industry is highly competitive.
Many of the Company's existing and potential competitors have financial,
personnel, marketing and other resources significantly greater than those of the
Company, as well as other competitive advantages including customer bases. See
the Risk Factor "Competition; Low Barriers of Entry" Part 1, Item 1.
PATENTS, TRADEMARKS, LICENSES, FRANCHISEES, CONCESSIONS, ROYALTY
PAYMENTS OR LABOR CONTRACTS
None; not applicable.
NEED FOR GOVERNMENT APPROVAL OF PRINCIPAL PRODUCTS OR SERVICES
Upon the effective date of this Registration Statement, the Company will
become subject to Regulation 14A promulgated by the Securities and Exchange
Commission under the 1934 Act. Section 14(a) of the 1934 Act requires all
companies with securities registered pursuant to Section 12(g) thereof to comply
with the rules and regulations of the Securities and Exchange Commission
regarding proxy solicitations as outlined in Regulation 14A. Matters submitted
to stockholders of the Company at a special or annual meeting thereof or
pursuant to a written consent shall require the Company to provide its
stockholders with the information outlined in Schedules 14A or 14C of Regulation
14; preliminary copies of this information must be submitted to the Securities
and Exchange Commission at least 10 days prior to the date that definitive
copies of this information are forwarded to stockholders. See the Risk Factor
"Government Regulation and Legal Uncertainties," Part 1, Item 1.
EFFECT OF EXISTING OR PROBABLE GOVERNMENTAL REGULATIONS ON BUSINESS
Other than maintaining its good standing in the State of Utah; complying
with applicable local business licensing requirements; preparing its periodic
reports under the Securities Exchange Act of 1934, as amended (the "1934 Act");
and complying with other applicable securities laws, rules and regulations as
set forth above, the Company does not believe that existing or probable
governmental regulations will have a material effect on its operations. However,
the Internet is a rapidly evolving commercial medium and may become subject to
numerous types of regulation in the future. Areas of potential regulation
include user privacy, advertising, information security and taxation. Because
Internet commerce is developing so rapidly, it is impossible to predict the type
and extent of governmental regulation in the future. See the Risk Factor
"Government Regulation and Legal Uncertainties," Part 1, Item 1.
RESEARCH AND DEVELOPMENT
Although the Internet web site design industry relies on the technical
knowledge of site designers, management does not believe that the Company's
proposed operations will require research and development in the traditional
sense. The Company's Secretary, Alycia Anthony has training in computer
information science and will be responsible for all of the Company's web site
design for the foreseeable future.
<PAGE>
NUMBER OF EMPLOYEES
Other than its President, James Doolin, and Secretary, Alycia Anthony, the
Company currently has no employees. Mr. Doolin and Ms. Anthony will be
responsible for all of the Company's proposed operations for the foreseeable
future. The Company will hire an additional clerical worker if necessary, and if
it is able to pay that worker's wages or salary from operating revenues.
Mr. Doolin will work without any salary until the Company has proven that
it can obtain sufficient operating revenues to stay in business. At that time,
Mr. Doolin will begin to take compensation that is consistent with the Company's
operating revenues and customs in the industry. Ms. Anthony will work on a
commission wage basis until the Company can obtain sufficient operating revenues
to stay in business. At that time, Ms. Anthony will begin to take compensation
that is consistent with the Company's operating revenues and customs in the
industry. See the caption "Executive Compensation," Part 1, Item 6.
Item 2. Management's Discussion and Analysis or Plan of Operation.
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Plan of Operations.
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The Company is a development stage company. Management believes that in
light of the large increase in the number of small and medium-sized companies
that will become connected to the Internet, the size of the potential market for
goods and services on the Internet will continue to increase rapidly.
Accordingly, the volume of business available to those who can provide
well-prepared web pages and related services will also increase rapidly over the
next several years.
The Company plans to provide a range of web page design and marketing
services. In addition, the Company intends to expand its operations by
acquiring, joint venturing or merging with other Internet service providers in
exchange for the issuance of shares of its common stock. As of the date of this
Registration Statement, the Company has not entered into any agreements in this
regard, and there is no assurance that the Company will be successful in
entering into a transaction with any such entity.
The foregoing contains "forward-looking" statements and information,
all of which is modified by reference to the caption "Risk Factors."
Results of Operations.
---------------------
The Company has commenced its intended web site design operations and has
begun advertising its design services through mailings and on the Internet. See
the heading "Distribution Methods of the Products or Services," Part 1, Item 1.
Liquidity.
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As of March 31, 2000, the Company had cash on hand of $23,182. Management
believes that these funds will be sufficient to allow it to commence advertising
via mailings and through the Internet. The Company has previosly purchased the
computer equipment to begin operations. The Company's cash on hand will be
sufficient to allow it to further operations; however, the Company's success in
its planned business endeavors will depend entirely on its ability to attract
and maintain a sufficient base of web site design clients. The Company has
commenced operations, but it cannot provide any assurances that it will be
successful in this effort.
Item 3. Description of Property.
---------------------------------
The Company currently owns a computer system, web site programming software
and art program software. Its business address is the home office address of its
Secretary, Alycia Anthony, and is provided rent-free. The Company has free
access to Ms. Anthony's telephone system and free access to the Internet via a
Internet service provider. Depending on its growth, the Company may find it
necessary to acquire an office and telephone system of its own, but management
does not believe that this will be necessary in the near future.
<PAGE>
Item 4. Security Ownership of Certain Beneficial Owners and Management.
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Security Ownership of Certain Beneficial Owners.
------------------------------------------------
The following table sets forth the share holdings of those persons who
own more than five percent of the Company's common stock as of the date hereof:
Number of Shares Percentage
Name Beneficially Owned of Class
---------------- ------------------ --------
LEONARD W. BURNINGHAM, ESQ. 205,000 18%
SHARLENE T. DOOLIN 180,000 16%
MIKE J. DOOLIN 100,000 9%
DUANE S. JENSON 125,000 11%
QUAD D PARTNERSHIP* 260,750 23%
* Sharlene Doolin may be deemed the beneficial owner of Quad D Partnership's
shares, as she is the majority partner of Quad D Partnership; and the mother of
James P. Doolin and Alycia Anthony; also Michael J. Doolin is their father.
Security Ownership of Management.
---------------------------------
The following table sets forth the share holdings of the Company's
directors and executive officers as of the date hereof:
Number of Shares Percentage of
Name and Address Beneficially Owned of Class
---------------- ------------------ -------------
JAMES P. DOOLIN 50,000 4%
RICK R. ANTHONY 25,000 2%
ALYCIA C. ANTHONY 25,000 2%
TOTAL OFFICERS & DIRECTORS 100,000 9%
Changes in Control.
-------------------
There are no present arrangements or pledges of the Company's securities
which may result in a change in control of the Company.
Item 5. Directors, Executive Officers, Promoters and Control Persons.
---------------------------------------------------------------------
Identification of Directors and Executive Officers.
---------------------------------------------------
The following table sets forth the name of the Company's current directors
and executive officers. These persons will serve until the next annual meeting
of the stockholders (held the third Friday in August of each year) or until
their successors are elected or appointed and qualified, or prior resignation or
termination. Their Date of Date of Positions Election or Termination
Name Held Designation or Resignation
---- ---- ----------- --------------
JAMES P. DOOLIN DIRECTOR & SEP-12-99 *
PRESIDENT
RICK R. ANTHONY DIRECTOR & SEP-12-99 *
VICE PRESIDENT
ALYCIA C. ANTHONY DIRECTOR & SEP-12-99 *
SECRETARY
* These persons presently serves in the capacities indicated.
Business Experience.
--------------------
James P. Doolin, President and a director, is 23 years of age. Mr Doolin
graduated from the University of Utah, in Salt Lake City. He graduated with a
bachelor of science, finance degree. Mr. Doolin has been working as an
investment consultant since 1998.
Rick R. Anthony, Vice President and a director, is 27 years of age. Mr.
Anthony graduated from the University of Utah, in Salt Lake City. He graduated
with a bachelor of fine arts. Mr. Anthony has been working as a public educator
since 1996.
Alycia C. Anthony, Secretary and a director, is 26 years of age. Ms.
Anthony graduated from the University of Utah, in Salt Lake City. She graduated
with a bachelor of science, and masters in Economics. Ms. Anthony has been
working in the public finance arena since 1996. She currently works for the
consulting firm of KPMG, Peat Marwick, Consulting, Inc.
<PAGE>
Significant Employees.
----------------------
Other than James P. Doolin and Alycia C. Anthony, the Company has no
employees.
Family Relationships.
---------------------
The only family relationships that exist between the directors and the
executive officers are as follows: James P. Doolin is Alycia C. Anthony's
brother; and Alycia C. Anthony and Rick R. Anthony are married.
Involvement in Certain Legal Proceedings.
-----------------------------------------
During the past five years, no present or former director, executive
officer or person nominated to become a director or an executive officer of the
Company:
(1) was a general partner or executive officer of any business against
which any bankruptcy petition was filed, either at the time of the bankruptcy or
two years prior to that time;
(2) was convicted in a criminal proceeding or named subject to a
pending criminal proceeding (excluding traffic violations and other minor
offenses);
(3) was subject to any order, judgment or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise limiting
his involvement in any type of business, securities or banking activities; or
(4) was found by a court of competent jurisdiction (in a civil
action), the Commission or the Commodity Futures Trading Commission to have
violated a federal or state securities or commodities law, and the judgment has
not been reversed, suspended or vacated.
<PAGE>
Item 6. Executive Compensation.
--------------------------------
The following table sets forth the aggregate compensation paid by the
Company for services rendered during the periods indicated:
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards Payouts
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Secur-
ities All
Name and Year or Other Rest- Under- LTIP Other
Principal Period Salary Bonus Annual rictedlying Pay- Comp-
Position Ended ($) ($) Compen-Stock Optionsouts ensat'n
-----------------------------------------------------------------
James P.
Doolin, 12/31/99 0 0 0 0 0 0 0
Director, 03/31/00 0 0 0 0 0 0 0
President
Rick R.
Anthony.
Director, 12/31/99 0 0 0 0 0 0 0
Vice 03/31/00 0 0 0 0 0 0 0
President
Alycia C.
Anthony, 12/31/99 $934.95 0 0 0 0 0 0
Director, 03/31/00 0 0 0 0 0 0 0
Secretary
No cash compensation, deferred compensation or long-term incentive plan
awards were issued or granted to the Company's management during the years ended
December 31, 1999, or the period ended March 31, 2000, other than the $934.95
that was paid to Alycia C. Anthony for commissions generating web pages for
clients. The Company no longer expects to compensate Ms. Anthony for services
until the Company has generated revenues sufficient to pay such compensation.
The Company has not entered into any compensation arrangement with Ms. Anthony
as of the date of this Registration Statement. However, Ms. Anthony's or any
other of the Company's current and/or future employees compensation will not
under any circumstances exceed the amount paid to other persons with similar
experience and expertise performing similar services in the web site design
industry. No employee, director, or executive officer have been granted any
option or stock appreciation rights; accordingly, no tables relating to such
items have been included within this Item.
<PAGE>
Compensation of Directors.
--------------------------
There are no standard arrangements pursuant to which the Company's
directors are compensated for any services provided as a director. No additional
amounts are payable to the Company's directors for committee participation or
special assignments.
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements.
------------------------------------------------------------------------
There are no employment contracts, compensatory plans or arrangements,
including payments to be received from the Company, with respect to any director
or executive officer of the Company which would in any way result in payments to
any such person because of his resignation, retirement or other termination of
employment with the Company, any change in control of the Company, or a change
in the person's responsibilities following a change in control of the Company.
Item 7. Certain Relationships and Related Transactions.
--------------------------------------------------------
With the exception of securities purchased on the Company's offerings, no
transactions between members of management, nominees to become a director or
executive officer, 5% stockholders, or promoters or persons who may be deemed to
be parents of the Company have taken place. See the captions "Business
Development" and "Security Ownership of Certain Beneficial Owners and
Management."
<PAGE>
Item 8. Description of Securities.
-----------------------------------
Common Stock
------------
The Company has one class of securities authorized, consisting of
100,000,000 shares of $0.01 par value common voting stock. The holders of the
Company's common stock are entitled to one vote per share on each matter
submitted to a vote at a meeting of stockholders. The shares of common stock do
not carry cumulative voting rights in the election of directors.
Stockholders of the Company have no pre-emptive rights to acquire
additional shares of common stock or other securities. The common stock is not
subject to redemption rights and carries no subscription or conversion rights.
All shares of the common stock now outstanding are fully paid and
non-assessable.
No Outstanding Options, Warrants or Calls
-----------------------------------------
There are no outstanding options, warrants or calls to purchase any of the
authorized securities of the Company.
No Provisions Limiting Change of Control
----------------------------------------
There is no provision in the Company's Articles of Incorporation or Bylaws
that would delay, defer, or prevent a change in control of the Company.
<PAGE>
PART II
Item 1. Market Price of and Dividends on the Company's Common Equity and
Other Stockholder Matters.
--------------------------
Market Information.
-------------------
There has never been any established "public market" for shares of common
stock of the Company. The Company intends to submit for listing on the OTC
Bulletin Board of the NASD. No assurance can be given that any market for the
Company's common stock will develop or be maintained. For any market that
develops for the Company's common stock, the sale of "restricted securities"
(common stock) pursuant to Rule 144 of the Securities and Exchange Commission by
the directors, executive officers or any other person to whom any such
securities may be issued in the future may have a substantial adverse impact on
any such public market. Information about the date when directors, executive
officers or any other person who may be deemed a beneficial holder, holding
period of "restricted securities" commenced can be found under the caption
"Recent Sales of Unregistered Securities," Part II, Item 4.
A minimum holding period of one year is required for resales under Rule
144, along with other pertinent provisions, including publicly available
information concerning the Company (this requirement will be satisfied by the
filing and effectiveness of this Registration Statement, the passage of 90 days
and the continued timely filing by the Company of all reports required to be
filed by it with the Securities and Exchange Commission); limitations on the
volume of "restricted securities" which can be sold in any 90 day period; the
requirement of unsolicited broker's transactions; and the filing of a Notice of
Sale of Form 144. Shares sold under Rule 504 may be possibly sold earlier under
Section 4 (i) of the 1933 Act.
Holders.
--------
The number of record holders of the Company's securities as of the date
of this registration statement is approximately 40.
Dividends.
----------
The Company has not declared any cash dividends with respect to its
common stock or its preferred stock, and does not intend to declare dividends in
the foreseeable future. The future dividend policy of the Company cannot be
ascertained with any certainty, and if and until the Company completes any sales
of its products, no such policy will be formulated. There are no material
restrictions limiting, or that are likely to limit, the Company's ability to pay
dividends on its securities.
<PAGE>
Item 2. Legal Proceedings.
---------------------------
The Company is not a party to any pending legal proceeding. No
federal, state or local governmental agency is presently contemplating any
proceeding against the Company. No director, executive officer or persons who
may be deemed to be an "affiliate" of the Company or owner of record or
beneficially of more than five percent of the Company's common stock is a party
adverse to the Company or has a material interest adverse to the Company in any
proceeding.
Item 3. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
---------------------
None; not applicable.
Item 4. Recent Sales of Unregistered Securities.
-------------------------------------------------
On August 11, 1999, the Company issued 200,000 shares to the Company's
officers, directors and a consultant in consideration of the payment of $2,000
to the Company.
On December 20, 1999, the Company conducted an offering of of 800,000
shares of common stock at a price of $0.035 per share. This offering was
conducted under Rule 504 of Regulation D of the Securities and Exchange
Commission and applicable state laws, rules and regulations. The offering was
subsequently closed, with the Company having received gross proceeds of $28,000.
On April 27, 2000, the Company issued 142,857 shares pursuant to Rule 701
of the 1933 Act. These shares were issued to the Company's attorney, in
accordance with a written plan adopted by the Board of Directors for services in
the amount of $5,000, rendered to the Company, issued at $.035 per share.
For Further information see the following table: "Common Stock"
Common Stock
------------
Date Number of Aggregate
Name Acquired Shares Consideration
---- -------- --------- -------------
JAMES P. DOOLIN* 09/12/99 50,000 $ 500
RICK R. ANTHONY* 09/12/99 25,000 $ 250
ALYCIA C. ANTHONY* 09/12/99 25,000 $ 250
MIKE J. DOOLIN* 09/12/99 100,000 $ 1,000
PURCHASERS UNDER 12/20/99 800,000 $ 28,000
RULE 504 OFFERING
SHARES ISSUED UNDER 04/27/00 142,857 $ 5,000
RULE 701
* James P. Doolin, Rick R. Anthony, and Alycia C. Anthony, are directors
and executive officers of the Company, and Mike J. Doolin is a consultant to the
Company, and as such had access to all material information regarding the
Company prior to the offer or sale of these securities. The directors and
executive officers are "accredited investor." The offers and sales of these
securities are believed to have been exempt from the registration requirements
of Section 5 of the Securities Act of 1933, as amended, pursuant to Sections
3(b) and/or 4(2) thereof, and from similar applicable states securities laws,
rules and regulations exempting the offer and sale of these securities by
available state exemptions from registration.
There have been no other sales of the Company's unregistered securities and
all stock purchasers.
<PAGE>
Item 5. Indemnification of Directors and Officers.
---------------------------------------------------
Section 16-10a-902(1) of the Utah Revised Business Corporation Act
authorizes a Utah corporation to indemnify any director against liability
incurred in any proceeding if he or she acted in good faith and in a manner he
or she reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful.
Section 16-10a-902(4) prohibits a Utah corporation from indemnifying a
director in a proceeding by or in the right of the corporation in which the
director was adjudged liable to the corporation or in a proceeding in which the
director was adjudged liable on the basis that he or she improperly received a
personal benefit. Otherwise, Section 16-10a-902(5) allows indemnification for
reasonable expenses incurred in connection with a proceeding by or in the right
of a corporation.
Unless limited by the Articles of Incorporation, Section 16-10a-905
authorizes a director to apply for indemnification to the court conducting the
proceeding or another court of competent jurisdiction. Section 16-10a-907(1)
extends this right to officers of a corporation as well.
Unless limited by the Articles of Incorporation, Section 16-10a-903
requires that a corporation indemnify a director who was successful, on the
merits or otherwise, in defending any proceeding to which he or she was a party
against reasonable expenses incurred in connection therewith. Section
16-10a-907(1) extends this protection to officers of a corporation as well.
Pursuant to Section 16-10a-904(1), the corporation may advance a
director's expenses incurred in defending any proceeding upon receipt of an
undertaking and a written affirmation of his or her good faith belief that he or
she has met the standard of conduct specified in Section 16-10a-902. Unless
limited by the Articles of Incorporation, Section 16- 10a-907(2) extends this
protection to officers, employees, fiduciaries and agents of a corporation as
well.
Regardless of whether a director, officer, employee, fiduciary or
agent has the right to indemnity under the Utah Revised Business Corporation
Act, Section 16-10a-908 allows the corporation to purchase and maintain
insurance on his or her behalf against liability resulting from his or her
corporate role.
<PAGE>
PART F/S
Index to Financial Statements
Report of Certified Public Accountants
Financial Statements
--------------------
Financial Statements
December 31, 1999 (audited)
------------------------
Independent Auditors' Report
Balance Sheet
Statement of Operations
Statement of Stockholders' Equity
Statement of Cash Flows
Notes to the Financial Statements
Unaudited Financial Statements for
the period March 31, 2000
-------------------------
Balance Sheet
Statement of Operations
Statement of Cash Flows
<PAGE>
WASATCH WEB ADVISORS, INC.
[A Development Stage Company]
FINANCIAL STATEMENTS
December 31, 1999
[WITH INDEPENDENT AUDITORS' REPORT]
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
[A Development Stage Company]
Table of Contents
Page
<S> <C>
Independent Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Balance Sheet - December 31, 1999 . . . . . . . . . . . . . . . . . . . . . . . 2
Statements of Stockholders' Equity/(Deficit) for the Period from
Inception [September 14, 1999] through December 31, 1999 . . . . . . . . .. . . 3
Statements of Operations for the Year Ended December 31, 1999 and
for the Period from Inception [September 14, 1999] through December 31, 1999. . 4
Statements of Cash Flows for the Year Ended December 31, 1999 and
for the Period from Inception [September 14, 1999] through December 31, 1999 . . 5
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . 6 - 8
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors and Stockholders
WASATCH WEB ADVISORS, INC.
Salt Lake City, Utah
We have audited the accompanying balance sheet of Wasatch Web Advisors, Inc. [a
development stage company] as of December 31, 1999, and the related statements
of stockholders' equity/(deficit), operations, and cash flows for the year ended
December 31, 1999 and for the period from inception [September 14, 1999] 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 audit.
We conducted our audit 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 audit provides 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 Wasatch Web Advisors, Inc. as
of December 31, 1999, and the results of operations and cash flows for the year
ended December 31, 1999,and for the period from inception [September 14, 1999]
through December 31, 1999, in conformity with generally accepted accounting
principles.
The accompanying financial statements have been prepared assuming that Wasatch
Web Advisors, Inc. will continue as a going concern. As discussed in Note D to
the financial statements, the Company has accumulated losses and is still
developing its planned operations. These issues raise substantial doubt about
its ability to continue as a going concern. Management's plans in regard to
these matters are also described in Note D. The financial statements do not
include any adjustment that might result from the outcome of this uncertainty.
/S/MANTYLA MCREYNOLDS
Mantyla McReynolds
Salt Lake City, Utah
March 10, 2000
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
[A Development Stage Company]
Balance Sheet
December 31, 1999
ASSETS
Current Assets
<S> <C>
Cash - Note A $ 24,963
--------
Total Current Assets $ 24,963
--------
Property and Equipment
Property and Equipment $ 4,003
Less: Accumulated Depreciation (311)
-------
Total Property and Equipment $ 3,692
--------
TOTAL ASSETS $ 28,655
========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities
Accrued Liabilities $ 138
Payable to shareholder 3,500
Income taxes payable - Notes A & C 100
---------
Total Current Liabilities 3,738
---------
TOTAL LIABILITIES 3,738
----------
STOCKHOLDERS' EQUITY
Capital stock - 50,000,000 shares authorized at $0.01 par;
1,000,000 shares issued and outstanding 10,000
Additional paid-in capital 20,000
Deficit accumulated during development stage (5,083)
--------
TOTAL STOCKHOLDERS' EQUITY 24,917
--------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 28,655
========
</TABLE>
See accompanying notes to financial statements
2
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
[A Development Stage Company]
Statements of Stockholders' Equity/(Deficit)
For the Period from Inception [September 14, 1999] through December 31, 1999
Deficit
Accumulated
Additional During Total
Number of Common Paid-in Development Stockholders'
Shares Stock Capital Stage Equity/(Deficit)
--------------- -------------- -------------- ---------------- -------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1998 -0- -0- $ -$- -0 $ -0-
Issued stock for cash , organization 200,000 2,000 2,000
Issued stock for cash , sale 800,000 8,000 20,000 28,000
Net loss for 1999 (5,083) (5,083)
--------------- -------------- -------------- ---------------- -------------------
Balance, December 31, 1999 1,000,000 $10,000 $20,000 ($5,083) $24,917
=============== ============== ============== ================ ===================
</TABLE>
See accompanying notes to financial statements
3
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
[A Development Stage Company]
Statements of Operations
For the Year Ended December 31, 1999 and for the Period from
Inception [September 14, 1999] through December 31, 1999
Year Ended From Inception
12/31/99 [9/14/99]
through
12/31/99
--------------- -----------------
<S> <C> <C>
Revenues $ 935 $ 935
Cost of Sales 935 935
--------------- -----------------
Gross Margin 0 0
General and Administrative Expenses 4,983 4,983
--------------- -----------------
Net Loss from Operations (4,983) (4,983)
--------------- -----------------
Net Loss Before Income Taxes (4,983) (4,983)
Provision for Income Taxes - Notes A&C 100 100
--------------- -----------------
Net Loss $ (5,083) $ (5,083)
=============== =================
Loss Per Share $ (.01) $ (.01)
=============== =================
Weighted Average Shares Outstanding 1,000,000 1,000,000
=============== =================
</TABLE>
See accompanying notes to financial statements
4
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
[A Development Stage Company]
Statements of Cash Flows
For the Year Ended December 31, 1999 and for the Period from
Inception [September 14, 1999] through December 31, 1999
For the
period from
Inception
[11/3/99]
through
Cash Flows Provided by/(Used for) Operating Activities 12/31/99 12/31/99
------------------------------------------------------
-------------- --------------
<S> <C> <C>
Net Loss $ (5,083) $ (5,083)
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation 311 311
Increase in income taxes payable 100 100
Increase in amount due to shareholder 3,500 3,500
Increase in accrued liabilities 138 138
-------------- --------------
Net Cash Provided by/(Used for) in Operating Activities (1,034) (1,034)
Cash Flows Provided by Investing Activities
Purchase of equipment (4,003) (4,003)
-------------- --------------
Net Cash Used by Investing Activities (4,003) (4,003)
Cash Flows Provided by Financing Activities
Issued stock for cash 30,000 30,000
-------------- --------------
Net Cash Provided by Financing Activities 30,000 30,000
Net Increase(decrease) in Cash 24,963 24,963
Beginning Cash Balance -0- -0-
-------------- --------------
Ending Cash Balance $ 24,963 $ 24,963
============== ==============
Supplemental Disclosure Information:
Cash paid during the year for interest -0- -0-
Cash paid during the year for income taxes -0- -0-
</TABLE>
See accompanying notes to financial statements
5
<PAGE>
WASATCH WEB ADVISORS, INC.
Notes to Financial Statements
December 31, 1999
NOTE A Summary of Significant Accounting Policies
Company Background
The Company incorporated under the laws of the State of Utah on
September 14, 1999. The Company was organized to engage in any lawful
activity for which corporations may be organized under the Utah Revised
Business Corporation Act. Wasatch Web Advisors, Inc., is in the
development stage and still organizing its planned principal operations,
which is essentially to advertise and offer Internet website development
for small to medium size businesses.
The financial statements of the Company have been prepared in accordance
with generally accepted accounting principles. The following summarizes
the more significant of such policies:
Statement of Cash Flows
Cash is comprised of cash on hand or on deposit in banks. The Company
has $24,963 as of December 31, 1999.
Property & Equipment
Property and equipment are stated at cost. Depreciation is provided
using the straight-line basis over the useful lives of the related
assets. Expenditures for maintenance and repairs are charged to expense
as incurred.
Income Taxes
In February 1992, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standard (SFAS) No. 109, "Accounting
For Income Taxes," which is effective for fiscal years beginning after
December 15, 1992. SFAS No. 109 requires the asset and liability method
of accounting for income taxes. The asset and liability method requires
that the current or deferred tax consequences of all events recognized
in the financial statements are measured by applying the provisions of
enacted tax laws to determine the amount of taxes payable or refundable
currently or in future years. The Company adopted SFAS No. 109 for
financial reporting purposes in 1999. See Note C below.
Net Loss Per Common Share
Net loss per common share is based on the weighted average number of
shares outstanding.
6
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
Notes to Financial Statements
December 31, 1999
NOTE A Summary of Significant Accounting Policies [continued]
------------------------------------------
Use of Estimates in Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
NOTE B Issuance of Common Shares
In September, 1999, pursuant to a Preorganization Subscription
Agreement, the Company issued 200,000 shares of common stock at par
($.01) for cash to four individuals, three of whom are officers and
directors. Additionally, in accordance with a Subscription Agreement and
Summary Offering Document, the Company issued 800,000 shares of common
stock at $.035 per share to 37 "accredited" investors for cash.
NOTE C Accounting for Income Taxes
During 1999, the Company adopted Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes." For the year ended
December 31, 1999, the Company had no significant income tax expenses
due to minimal operations during the period. Any deferred tax benefit
arising from the operating loss carried forward, the benefits of which
will expire in 2014, would be offset entirely by a valuation allowance
since it is not likely that the Company will be sufficiently profitable
in the near future to take advantage of the losses. The Company has no
timing differences.
Deferred tax assets Balance Tax Rate
------------------------------------------ -------------- ------------ --------
<S> <C> <C> <C>
Federal Loss carryforward(expires 2014) $5,083 $762 15%
State Loss carryforward(expires 2014) $4,983 $249 5%
Valuation allowance ($1,011)
------------
Deferred tax asset $0
============
The amount shown on the balance sheet for income taxes payable
represents the annual minimum amount due to the State of Utah.
</TABLE>
7
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
Notes to Financial Statements
December 31, 1999
NOTE D Liquidity
The Company has accumulated losses since inception totaling $5,083, and
had minimal operations through December 31, 1999. Financing for the
Company's activities to date has been primarily provided by issuance of
stock and advances from a stockholder. The Company's ability to achieve
a level of profitable operations and/or additional financing impacts the
Company's ability to continue as it is presently organized. Management
is continuing to develop its planned principle operations. Should
management be unsuccessful in its operating activities, the Company may
experience material adverse effects.
NOTE E Stockholder Loan
A stockholder has advanced legal services to the Company in the amount
of $3,500 during the year ended December 31, 1999. The Company has
recorded a liability for this expense to the stockholder. The unsecured
loan bears no interest and is due on demand.
NOTE F Property & Equipment
The major classes of assets as of the balance sheet date are as follows:
Accumulated
Asset Class Cost Depreciation Method/Life
<S> <C> <C> <C>
Computer Equipment $3,007 $200 SL/5
Software 996 111 SL/3
------------- -----------------
Total $4,003 $311
============= =================
Current year depreciation expense was $311.
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
Balance Sheet
March 31, 2000
ASSETS
Current Assets
<S> <C>
Cash - Note A $ 23,488
Total Current Assets $ 23,488
Property and Equipment
Property and Equipment $ 4,003
Less: Accumulated Depreciation (544)
Total Property and Equipment $ 3,459
TOTAL ASSETS $ 26,947
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Current Liabilities
Accrued Liabilities $ 138
Payable to shareholder 3,500
Income taxes payable - Notes A & C 100
Total Current Liabilities 3,738
TOTAL LIABILITIES 3,738
STOCKHOLDERS' EQUITY
Capital stock - 50,000,000 shares authorized at $0.01 par;
1,000,000 shares issued and outstanding 10,000
Additional paid-in capital 20,000
Deficit accumulated during development stage ( 6,791)
TOTAL STOCKHOLDERS EQUITY 23,209
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $ 26,947
See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
Statements of Operations
For the Period Ended March 31, 2000
For the
period ending
03/31/00
---------------
<S> <C>
Revenues $ 306
Cost of Sales 0
---------------
Gross Margin 0
General and Administrative Expenses 2,014
---------------
Net Loss from Operations (1,708)
---------------
Net Loss Before Income Taxes (1,708)
Provision for Income Taxes - Notes A&C 0
---------------
Net Loss $ (1,708)
===============
Loss Per Share $ (.01)
===============
Weighted Average Shares Outstanding 1,000,000
===============
See accompanying notes to financial statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
WASATCH WEB ADVISORS, INC.
Statements of Cash Flows
For the Period Ended March 31, 2000
For the
period ending
03/31/00
Cash Flows Provided by/(Used for) Operating Activities
--------------
<S> <C>
Net Loss $ (1,708)
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation 233
Increase in income taxes payable 0
Increase in amount due to shareholder 0
Increase in accrued liabilities 0
--------------
Net Cash Provided by/(Used for) in Operating Activities (1,475)
Cash Flows Provided by Investing Activities
Purchase of equipment 0
--------------
Net Cash Used by Investing Activities 0
Cash Flows Provided by Financing Activities
Issued stock for cash 0
--------------
Net Cash Provided by Financing Activities 0
Net Increase(decrease) in Cash 1,475
Beginning Cash Balance 24,963
--------------
Ending Cash Balance $ 23,488
==============
</TABLE>
NOTE TO FINANCIAL STATEMENTS: Interim financial statements reflect all
adjustments which are, in the opinion of management, necessary to a fair
statement of the results for the periods. The March 31, 2000, balance sheet has
been derived from the audited financial statements. These interim financial
statements conform with the requirements for interim financial statements and
consequently do not include all the disclosures normally required by generally
accepted accounting principles.
See accompanying notes to financial statements
<PAGE>
PART III
Item 1. Index to Exhibits.
---------------------------
The following exhibits are filed as a part of this Registration Statement:
Exhibit
Number Description*
------ ------------
3.1 Articles of Incorporation
3.2 Articles of Amendment to the Articles of Incorporation
3.3 Bylaws
27 Financial Data Schedule
* Summaries of all exhibits contained within this Registration Statement
are modified in their entirety by reference to these Exhibits.
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the Registrant has caused this Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized.
WASATCH WEB ADVISORS, INC.
Date:May 31, 2000 /S/ JAMES DOOLIN
---------- ------------------------
James P. Doolin, Director
and President
Date:May 31, 2000 /S/ ALYCIA ANTHONY
---------- ------------------------
Alycia C. Anthony, Director
and Secretary
<PAGE>
EX-3.1
ARTICLES OF INCORPORATION
OF
WASATCH WEB ADVISORS, INC.
The undersigned natural person of the age of eighteen years or more, acting
as the incorporator of a corporation under the Utah Revised Business Corporation
Act, hereby adopts the following Articles of Incorporation for such corporation:
ARTICLE I
Name
The name of this corporation is "Wasatch Web Advisors, Inc."
ARTICLE II
Duration
The duration of this corporation is perpetual.
ARTICLE III
Purposes
The purpose or purposes for which this corporation is organized are: To
engage in any other lawful act or activity for which corporations may be
organized under the Utah Revised Business Corporation Act.
ARTICLE IV
Stock
The aggregate number of shares which this corporation shall have authority
to issue is 50,000,000 shares of common voting stock of a par value of one cent
($0.001) per share. All stock of the corporation shall be of the same class,
common, and shall have the same rights and preferences. Fully paid stock of this
corporation shall not be liable to any further call or assessment.
ARTICLE V
Amendment
These Articles of Incorporation may be amended by the affirmative vote of a
majority of the shares entitled to vote on each such amendment.
ARTICLE VI
Shareholder Rights
The authorized and treasury stock of this corporation may be issued at such
time, upon such terms and conditions and for such consideration as the Board of
Directors shall determine. Shareholders shall not have pre-emptive rights to
acquire unissued shares of stock of this corporation. Nor shall shareholders be
entitled to vote cumulatively for directors of the corporation.
ARTICLE VII
Initial Office and Agent
The name of the corporation's original registered agent and the address of
its initial registered office is:
Ryan Seare
4721 South Atwood Blvd.
Salt Lake City, UT 84117
<PAGE>
ARTICLE VIII
Directors
The number of directors constituting the initial Board of Directors of this
corporation is three. The names and addresses of persons who are to serve as
directors until the first annual meeting of shareholders, or until their
successors are elected and qualify, are:
James Doolin
5 Pepperwood Dr
Sandy, UT 84092
Alycia Anthony
941 East 3665 South
Salt Lake City, 84106
Richard Anthony
941 East 3665 South
Salt Lake City, 84106
ARTICLE IX
Incorporator
The name and address of the Incorporator is:
James Doolin
5 Pepperwood Dr
Sandy UT 84092
ARTICLE X
Common Directors - Transactions Between Corporation
No contract or other transaction between this corporation and one or more
of its directors or any other corporation, firm, association or entity in which
one or more of its directors are directors or officers or are financially
interested, shall be either void or voidable because of such relationship or
interest, or because such director or directors are present at the meeting of
the Board of Directors, or a committee thereof which authorizes, approves, or
ratifies such contract or transaction, or because his, her or their votes are
counted for such purposes if: (a) the fact of such relationship or interest is
disclosed or known to the Board of Directors or committee which authorizes,
approves, or ratifies the contract or transaction by vote or consent sufficient
for the purpose without counting the votes or consents of such interested
Director; (b) the fact of such relationship or interest is disclosed or known to
the shareholders entitled to vote and they authorize, approve or ratify such
contract or transaction by vote or written consent; or (c) the contract or
transaction is fair and reasonable to the corporation.
Common or interested directors may be counted in determining the presence
of a quorum at a meeting of the Board of Directors or committee thereof which
authorizes, approves, or ratifies such contract or transaction.
/S/JAMES DOOLIN
James Doolin, Incorporator
<PAGE>
STATE OF UTAH )
) ss
COUNTY OF SALT LAKE )
I, a notary public, hereby certify that on the 14th day of September, 1999,
James Doolin personally appeared before me who being by me first duly sworn,
declared that he is the person who signed the foregoing document as incorporator
and that the statements therein contained are true.
/S/KATHLEEN MORRISON
NOTARY PUBLIC
Residing at Salt Lake
County, Utah
<PAGE>
EX-3.2
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
WASATCH WEB ADVISORS, INC.
Pursuant to the provisions of the Utah Business Corporation Act, the
undersigned Corporation hereby, adopts the following Articles of Amendment to
its Articles of Incorporation.
I
The name of the Corporation is:
Wasatch Web Advisors, Inc.
II
The following amendments to the Articles of Incorporation were adopted by
the Board of Directors of the Corporation:
FIRST: Article IV shall be amended as follows, to-wit:
------ -
The aggregate number of shares which this Corporation shall have the
authority to issue is 50,000,000 shares of common voting stock of a par value of
one cent ($0.01) per share. All stock of the corporation shall be of the same
class, common, and shall have the same rights and preferences. Fully paid stock
of this corporation shall not be liable to any further call or assessment.
SECOND:Shareholder approval is not required.
--------
In witness whereof, Wasatch Web Advisors, Inc. Has caused this certificate
to be signed by James Doolin, the Company's President and Alycia Anthony, the
Company's Secretary. This 6TH day of February, 2000.
By: /S/JAMES DOOLIN
James Doolin, President
By: /S/ALYCIA ANTHONY
Alycia Anthony, Secretary
<PAGE>
EX-3.3
BYLAWS
OF
WASATCH WEB ADVISORS, INC.
ARTICLE I
OFFICES
Section 1.01 Location of Office. The corporation may maintain such
offices within or without the State of Utah as the Board of Directors may from
time to time designate or require.
Section 1.02 Principal Office. The address of the principal office of
the corporation shall be at the address of the registered office of the
corporation as so designated in the office of the Lieutenant Governor/Secretary
of State of the state of incorporation, or at such other address as the Board of
Directors shall from time to time determine.
ARTICLE II
SHAREHOLDERS
Section 2.0 Annual Meeting. The annual meeting of the shareholders shall
be held in May of each year or at such other time designated by the Board of
Directors and as is provided for in the notice of the meeting, for the purpose
of electing directors and for the transaction of such other business as may come
before the meeting. If the election of directors shall not be held on the day
designated for the annual meeting of the shareholders, or at any adjournment
thereof, the Board of Directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as may be convenient.
Section 2.02 Special Meetings. Special meetings of the shareholders may
be called at any time by the chairman of the board, the president, or by the
Board of Directors, or in their absence or disability, by any vice president,
and shall be called by the president or, in his or her absence or disability, by
a vice president or by the secretary on the written request of the holders of
not less than one-tenth of all the shares entitled to vote at the meeting, such
written request to state the purpose or purposes of the meeting and to be
delivered to the president, each vice-president, or secretary. In case of
failure to call such meeting within 60 days after such request, such shareholder
or shareholders may call the same.
Section 2.03 Place of Meetings. The Board of Directors may designate any
place, either within or without the state of incorporation, as the place of
meeting for any annual meeting or for any special meeting called by the Board of
Directors. A waiver of notice signed by all shareholders entitled to vote at a
meeting may designate any place, either within or without the state of
incorporation, as the place for the holding of such meeting. If no designation
is made, or if a special meeting be otherwise called, the place of meeting shall
be at the principal office of the corporation.
Section 2.04 Notice of Meetings. The secretary or assistant secretary,
if any, shall cause notice of the time, place, and purpose or purposes of all
meetings of the shareholders (whether annual or special), to be mailed at least
ten (10) days, but not more than fifty (50) days, prior to the meeting, to each
shareholder of record entitled to vote.
Section 2.05 Waiver of Notice. Any shareholder may waive notice of any
meeting of shareholders (however called or noticed, whether or not called or
noticed and whether before, during, or after the meeting), by signing a written
waiver of notice or a consent to the holding of such meeting, or an approval of
the minutes thereof. Attendance at a meeting, in person or by proxy, shall
constitute waiver of all defects of call or notice regardless of whether waiver,
consent, or approval is signed or any objections are made. All such waivers,
consents, or approvals shall be made a part of the minutes of the meeting.
<PAGE>
Section 2.06 Fixing Record Date. For the purpose of determining
shareholders entitled to notice of or to vote at any annual meeting of
shareholders or any adjournment thereof, or shareholders entitled to receive
payment of any dividend or in order to make a determination of shareholders for
any other proper purpose, the Board of Directors of the corporation may provide
that the share transfer books shall be closed, for the purpose of determining
shareholders entitled to notice of or to vote at such meeting, but not for a
period exceeding fifty (50) days. If the share transfer books are closed for the
purpose of determining shareholders entitled to notice of or to vote at such
meeting, such books shall be closed for at least ten (10) days immediately
preceding such meeting.
In lieu of closing the share transfer books, the Board of Directors may
fix in advance a date as the record date for any such determination of
shareholders, such date in any case to be not more than fifty (50) and, in case
of a meeting of shareholders, not less than ten (10) days prior to the date on
which the particular action requiring such determination of shareholders is to
be taken. If the share transfer books are not closed and no record date is fixed
for the determination of shareholders entitled to notice of or to vote at a
meeting or to receive payment of a dividend, the date on which notice of the
meeting is mailed or the date on which the resolution of the Board of Directors
declaring such dividend is adopted, as the case may be, shall be the record date
for such determination of shareholders. When a determination of shareholders
entitled to vote at any meeting of shareholders has been made as provided in
this Section, such determination shall apply to any adjournment thereof. Failure
to comply with this Section shall not affect the validity of any action taken at
a meeting of shareholders.
Section 2.07 Voting Lists. The officer or agent of the corporation
having charge of the share transfer books for shares of the corporation shall
make, at least ten (10) days before each meeting of the shareholders, a complete
list of the shareholders entitled to vote at such meeting or any adjournment
thereof, arranged in alphabetical order, with the address of, and the number of
shares held by each, which list, for a period of ten (10) days prior to such
meeting, shall be kept on file at the registered office of the corporation and
shall be subject to inspection by any shareholder during the whole time of the
meeting. The original share transfer book shall be prima facia evidence as to
the shareholders who are entitled to examine such list or transfer books, or to
vote at any meeting of shareholders.
Section 2.08 Quorum. One-half of the total voting power of the
outstanding shares of the corporation entitled to vote, represented in person or
by proxy, shall constitute a quorum at a meeting of the shareholders. If a
quorum is present, the affirmative vote of the majority of the voting power
represented by shares at the meeting and entitled to vote on the subject shall
constitute action by the shareholders, unless the vote of a greater number or
voting by classes is required by the laws of the state of incorporation of the
corporation or the Articles of Incorporation. If less than one-half of the
outstanding voting power is represented at a meeting, a majority of the voting
power represented by shares so present may adjourn the meeting from time to time
without further notice. At such adjourned meeting at which a quorum shall be
present or represented, any business may be transacted which might have been
transacted at the meeting as originally noticed.
Section 2.09 Voting of Shares. Each outstanding share of the corporation
entitled to vote shall be entitled to one vote on each matter submitted to vote
at a meeting of shareholders, except to the extent that the voting rights of the
shares of any class or series of stock are determined and specified as greater
or lesser than one vote per share in the manner provided by the Articles of
Incorporation.
Section 2.10 Proxies. At each meeting of the shareholders, each
shareholder entitled to vote shall be entitled to vote in person or by proxy;
provided, however, that the right to vote by proxy shall exist only in case the
instrument authorizing such proxy to act shall have been executed in writing by
the registered holder or holders of such shares, as the case may be, as shown on
the share transfer of the corporation or by his or her or her attorney thereunto
duly authorized in writing. Such instrument authorizing a proxy to act shall be
delivered at the beginning of such meeting to the secretary of the corporation
or to such other officer or person who may, in the absence of the secretary, be
acting as secretary of the meeting. In the event that any such instrument shall
designate two or more persons to act as proxies, a majority of such persons
present at the meeting, or if only one be present, that one shall (unless the
instrument shall otherwise provide) have all of the powers conferred by the
instrument on all persons so designated. Persons holding stock in a fiduciary
capacity shall be entitled to vote the shares so held and the persons whose
shares are pledged shall be entitled to vote, unless in the transfer by the
pledge or on the books of the corporation he or she shall have expressly
empowered the pledgee to vote thereon, in which case the pledgee, or his or her
proxy, may represent such shares and vote thereon.
<PAGE>
Section 2.11 Written Consent to Action by Shareholders. Any action
required to be taken at a meeting of the shareholders, or any other action which
may be taken at a meeting of the shareholders, may be taken without a meeting,
if a consent in writing, setting forth the action so taken, shall be signed by
all of the shareholders entitled to vote with respect to the subject matter
thereof.
ARTICLE III
DIRECTORS
Section 3.01 General Powers. The property, affairs, and business of the
corporation shall be managed by its Board of Directors. The Board of Directors
may exercise all the powers of the corporation whether derived from law or the
Articles of Incorporation, except such powers as are by statute, by the Articles
of Incorporation or by these Bylaws, vested solely in the shareholders of the
corporation.
Section 3.02 Number, Term, and Qualifications. The Board of Directors
shall consist of three to nine persons. Increases or decreases to said number
may be made, within the numbers authorized by the Articles of Incorporation, as
the Board of Directors shall from time to time determine by amendment to these
Bylaws. An increase or a decrease in the number of the members of the Board of
Directors may also be made upon amendment to these Bylaws by a majority vote of
all of the shareholders, and the number of directors to be so increased or
decreased shall be fixed upon a majority vote of all of the shareholders of the
corporation. Each director shall hold office until the next annual meeting of
shareholders of the corporation and until his or her successor shall have been
elected and shall have qualified. Directors need not be residents of the state
of incorporation or shareholders of the corporation.
Section 3.03 Classification of Directors. In lieu of electing the entire
number of directors annually, the Board of Directors may provide that the
directors be divided into either two or three classes, each class to be as
nearly equal in number as possible, the term of office of the directors of the
first class to expire at the first annual meeting of shareholders after their
election, that of the second class to expire at the second annual meeting after
their election, and that of the third class, if any, to expire at the third
annual meeting after their election. At each annual meeting after such
classification, the number of directors equal to the number of the class whose
term expires at the time of such meeting shall be elected to hold office until
the second succeeding annual meeting, if there be two classes, or until the
third succeeding annual meeting, if there be three classes.
Section 3.04 Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than this Bylaw immediately
following, and at the same place as, the annual meeting of shareholders. The
Board of Directors may provide by resolution the time and place, either within
or without the state of incorporation, for the holding of additional regular
meetings without other notice than such resolution.
Section 3.05 Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the president, vice president,
or any two directors. The person or persons authorized to call special meetings
of the Board of Directors may fix any place, either within or without the state
of incorporation, as the place for holding any special meeting of the Board of
Directors called by them.
Section 3.06 Meetings by Telephone Conference Call. Members of the Board
of Directors may participate in a meeting of the Board of Directors or a
committee of the Board of Directors by means of conference telephone or similar
communication equipment by means of which all persons participating in the
meeting can hear each other, and participation in a meeting pursuant to this
Section shall constitute presence in person at such meeting.
<PAGE>
Section 3.07 Notice. Notice of any special meeting shall be given at
least ten (10) days prior thereto by written notice delivered personally or
mailed to each director at his or her regular business address or residence, or
by telegram. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail so addressed, with postage thereon prepaid.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegraph company. Any director may waive
notice of any meeting. Attendance of a director at a meeting shall constitute a
waiver of notice of such meeting, except where a director attends a meeting
solely for the express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened.
Section 3.08 Quorum. A majority of the number of directors shall
constitute a quorum for the transaction of business or any meeting of the Board
of Directors, but if less than a majority is present at a meeting, a majority of
the directors present may adjourn the meeting from time to time without further
notice.
Section 3.09 Manner of Acting. The act of a majority of the directors
present at a meeting at which a quorum is present shall be the act of the Board
of Directors, and the individual directors shall have no power as such.
Section 3.10 Vacancies and Newly Created Directorship. If any vacancies
shall occur in the Board of Directors by reason of death, resignation or
otherwise, or if the number of directors shall be increased, the directors then
in office shall continue to act and such vacancies or newly created
directorships shall be filled by a vote of the directors then in office, though
less than a quorum, in any way approved by the meeting. Any directorship to be
filled by reason of removal of one or more directors by the shareholders may be
filled by election by the shareholders at the meeting at which the director or
directors are removed.
Section 3.11 Compensation. By resolution of the Board of Directors, the
directors may be paid their expenses, if any, of attendance at each meeting of
the Board of Directors, and may be paid a fixed sum for attendance at each
meeting of the Board of Directors or a stated salary as director. No such
payment shall preclude any director from serving the corporation in any other
capacity and receiving compensation therefor.
Section 3.12 Presumption of Assent. A director of the corporation who is
present at a meeting of the Board of Directors at which action on any corporate
matter is taken shall be presumed to have assented to the action taken unless
his or her dissent shall be entered in the minutes of the meeting, unless he or
she shall file his or her written dissent to such action with the person acting
as the secretary of the meeting before the adjournment thereof, or shall forward
such dissent by registered or certified mail to the secretary of the corporation
immediately after the adjournment of the meeting. Such right to dissent shall
not apply to a director who voted in favor of such action.
Section 3.13 Resignations. A director may resign at any time by
delivering a written resignation to either the president, a vice president, the
secretary, or assistant secretary, if any. The resignation shall become
effective on its acceptance by the Board of Directors; provided, that if the
board has not acted thereon within ten days (10) from the date presented, the
resignation shall be deemed accepted.
Section 3.14 Written Consent to Action by Directors. Any action required
to be taken at a meeting of the directors of the corporation or any other action
which may be taken at a meeting of the directors or of a committee, may be taken
without a meeting, if a consent in writing, setting forth the action so taken,
shall be signed by all of the directors, or all of the members of the committee,
as the case may be. Such consent shall have the same legal effect as a unanimous
vote of all the directors or members of the committee.
Section 3.15 Removal. At a meeting expressly called for that purpose,
one or more directors may be removed by a vote of a majority of the shares of
outstanding stock of the corporation entitled to vote at an election of
directors.
<PAGE>
ARTICLE IV
OFFICERS
Section 4.01 Number. The officers of the corporation shall be a
president, one or more vice-presidents, as shall be determined by resolution of
the Board of Directors, a secretary, a treasurer, and such other officers as may
be appointed by the Board of Directors. The Board of Directors may elect, but
shall not be required to elect, a chairman of the board and the Board of
Directors may appoint a general manager.
Section 4.02 Election, Term of Office, and Qualifications. The officers
shall be chosen by the Board of Directors annually at its annual meeting. In the
event of failure to choose officers at an annual meeting of the Board of
Directors, officers may be chosen at any regular or special meeting of the Board
of Directors. Each such officer (whether chosen at an annual meeting of the
Board of Directors to fill a vacancy or otherwise) shall hold his or her office
until the next ensuing annual meeting of the Board of Directors and until his or
her successor shall have been chosen and qualified, or until his or her death,
or until his or her resignation or removal in the manner provided in these
Bylaws. Any one person may hold any two or more of such offices, except that the
president shall not also be the secretary. No person holding two or more offices
shall act in or execute any instrument in the capacity of more than one office.
The chairman of the board, if any, shall be and remain a director of the
corporation during the term of his or her office. No other officer need be a
director.
Section 4.03 Subordinate Officers, Etc. The Board of Directors from time
to time may appoint such other officers or agents as it may deem advisable, each
of whom shall have such title, hold office for such period, have such authority,
and perform such duties as the Board of Directors from time to time may
determine. The Board of Directors from time to time may delegate to any officer
or agent the power to appoint any such subordinate officer or agents and to
prescribe their respective titles, terms of office, authorities, and duties.
Subordinate officers need not be shareholders or directors.
Section 4.04 Resignations. Any officer may resign at any time by
delivering a written resignation to the Board of Directors, the president, or
the secretary. Unless otherwise specified therein, such resignation shall take
effect on delivery.
Section 4.05 Removal. Any officer may be removed from office at any
special meeting of the Board of Directors called for that purpose or at a
regular meeting, by vote of a majority of the directors, with or without cause.
Any officer or agent appointed in accordance with the provisions of Section 4.03
hereof may also be removed, either with or without cause, by any officer on whom
such power of removal shall have been conferred by the Board of Directors.
<PAGE>
Section 4.06 Vacancies and Newly Created Offices. If any vacancy shall
occur in any office by reason of death, resignation, removal, disqualification,
or any other cause, or if a new office shall be created, then such vacancies or
newly created offices may be filled by the Board of Directors at a regular or
special meeting.
Section 4.07 The Chairman of the Board. The Chairman of the Board, if
there be such an officer, shall have the following powers and duties:
(a) He or she shall preside at all shareholders' meetings;
(b) He or she shall preside at all meetings of the Board of Directors;
and
(c) He or she shall be a member of the executive committee, if any.
Section 4.08
The President. The president shall have the following powers and duties:
(a) If no general manager has been appointed, he or she shall be the
chief executive officer of the corporation, and, subject to the direction of the
Board of Directors, shall have general charge of the business, affairs, and
property of the corporation and general supervision over its officers,
employees, and agents;
(b) If no chairman of the board has been chosen, or if such officer is
absent or disabled, he or she shall preside at meetings of the shareholders and
Board of Directors;
(c) He or she shall be a member of the executive committee, if any;
(d) He or she shall be empowered to sign certificates representing
shares of the corporation, the issuance of which shall have been authorized by
the Board of Directors; and
(e) He or she shall have all power and shall perform all duties normally
incident to the office of a president of a corporation, and shall exercise such
other powers and perform such other duties as from time to time may be assigned
to him or her by the Board of Directors.
Section 4.10 The Secretary.
The secretary shall have the following powers and duties:
-------------
(a) He or she shall keep or cause to be kept a record of all of the
proceedings of the meetings of the shareholders and of the Board of Directors in
books provided for that purpose;
(b) He or she shall cause all notices to be duly given in accordance
with the provisions of theseBylaws and as required by statute;
(c) He or she shall be the custodian of the records and of the seal of
the corporation, and shall cause such seal (or a facsimile thereof) to be
affixed to all certificates representing shares of the corporation prior to the
issuance thereof and to all instruments, the execution of which on behalf of the
corporation under its seal shall have been duly authorized in accordance with
these Bylaws, and when so affixed, he or she may attest the same;
(d) He or she shall assume responsibility that the books, reports,
statements, certificates, and other documents and records required by statute
are properly kept and filed;
(e) He or she shall have charge of the share books of the corporation
and cause the share transfer books to be kept in such manner as to show at any
time the amount of the shares of the corporation of each class issued and
outstanding, the manner in which and the time when such stock was paid for, the
names alphabetically arranged and the addresses of the holders of record
thereof, the number of shares held by each holder and time when each became such
holder or record; and he or she shall exhibit at all reasonable times to any
director, upon application, the original or duplicate share register. He or she
shall cause the share book referred to in Section 6.04 hereof to be kept and
exhibited at the principal office of the corporation, or at such other place as
the Board of Directors shall determine, in the manner and for the purposes
provided in such Section;
(f) He or she shall be empowered to sign certificates representing
shares of the corporation, the issuance of which shall have been authorized by
the Board of Directors; and
(g) He or she shall perform in general all duties incident to the office
of secretary and such other duties as are given to him or her by these Bylaws or
as from time to time may be assigned to him or her by the Board of Directors or
the president.
<PAGE>
Section 4.11 The Treasurer.
The treasurer shall have the following powers and duties:
(a) He or she shall have charge and supervision over and be responsible
for the monies, securities, receipts, and disbursements of the corporation;
(b) He or she shall cause the monies and other valuable effects of the
corporation to be deposited in the name and to the credit of the corporation in
such banks or trust companies or with such banks or other depositories as shall
be selected in accordance with Section 5.03 hereof;
(c) He or she shall cause the monies of the corporation to be disbursed
by checks or drafts (signed as provided in Section 5.04 hereof) drawn on the
authorized depositories of the corporation, and cause to be taken and preserved
property vouchers for all monies disbursed;
(d) He or she shall render to the Board of Directors or the president,
whenever requested, a statement of the financial condition of the corporation
and of all of this transactions as treasurer, and render a full financial report
at the annual meeting of the shareholders, if called upon to do so;
(e) He or she shall cause to be kept correct books of account of all the
business and transactions of the corporation and exhibit such books to any
director on request during business hours;
(f) He or she shall be empowered from time to time to require from all
officers or agents of the corporation reports or statements given such
information as he or she may desire with respect to any and all financial
transactions of the corporation; and
(g) He or she shall perform in general all duties incident to the office
of treasurer and such other duties as are given to him or her by these Bylaws or
as from time to time may be assigned to him or her by the Board of Directors or
the president.
Section 4.12 General Manager.
The Board of Directors may employ and appoint a general manager who may,
or may not, be one of the officers or directors of the corporation. The general
manager, if any, shall have the following powers and duties;
(a) He or she shall be the chief executive officer of the corporation
and, subject to the directions of the Board of Directors, shall have general
charge of the business affairs and property of the corporation and general
supervision over its officers, employees, and agents;
(b) He or she shall be charged with the exclusive management of the
business of the corporation and of all of its dealings, but at all times be
subject to the control of the Board of Directors;
(c) Subject to the approval of the Board of Directors or the executive
committee, if any, he or she shall employ all employees of the corporation, or
delegate such employment to subordinate officers, and shall have authority to
discharge any person so employed; and
(d) He or she shall make a report to the president and directors as
often as required, setting forth the results of the operations under his or her
charge, together with suggestions looking toward improvement and betterment of
the condition of the corporation, and shall perform such other duties as the
Board of Directors may require.
Section 4.13 Salaries. The salaries and other compensation of the
officers of the corporation shall be fixed from time to time by the Board of
Directors, except that the Board of Directors may delegate to any person or
group of persons the power to fix the salaries or other compensation of any
subordinate officers or agents appointed in accordance with the provisions of
Section 4.03 hereof. No officer shall be prevented from receiving any such
salary or compensation by reason of the fact that he or she is also a director
of the corporation.
Section 4.14 Surety Bonds. In case the Board of Directors shall so
require, any officer or agent of the corporation shall execute to the
corporation a bond in such sums and with such surety or sureties as the Board of
Directors may direct, conditioned upon the faithful performance of his or her
duties to the corporation, including responsibility for negligence and for the
accounting of all property, monies, or securities of the corporation which may
come into his or her hands.
<PAGE>
ARTICLE V
EXECUTION OF INSTRUMENTS, BORROWING OF MONEY,
AND DEPOSIT OF CORPORATE FUNDS
Section 5.01 Execution of Instruments. Subject to any limitation
contained in the Articles of Incorporation or these Bylaws, the president or any
vice president or the general manager, if any, may, in the name and on behalf of
the corporation, execute and deliver any contract or other instrument authorized
in writing by the Board of Directors. The Board of Directors may, subject to any
limitation contained in the Articles of Incorporation or in these Bylaws,
authorize in writing any officer or agent to execute and deliver any contract or
other instrument in the name and on behalf of the corporation; any such
authorization may be general or confined to specific instances.
Section 5.02 Loans. No loans or advances shall be contracted on behalf
of the corporation, no negotiable paper or other evidence of its obligation
under any loan or advance shall be issued in its name, and no property of the
corporation shall be mortgaged, pledged, hypothecated, transferred, or conveyed
as security for the payment of any loan, advance, indebtedness, or liability of
the corporation, unless and except as authorized by the Board of Directors. Any
such authorization may be general or confined to specific instances.
Section 5.03 Deposits. All monies of the corporation not otherwise
employed shall be deposited from time to time to its credit in such banks and or
trust companies or with such bankers or other depositories as the Board of
Directors may select, or as from time to time may be selected by any officer or
agent authorized to do so by the Board of Directors.
Section 5.04 Checks, Drafts, Etc. All notes, drafts, acceptances,
checks, endorsements, and, evidences of indebtedness of the corporation, subject
to the provisions of these Bylaws, shall be signed by such officer or officers
or such agent or agents of the corporation and in such manner as the Board of
Directors from time to time may determine. Endorsements for deposit to the
credit of the corporation in any of its duly authorized depositories shall be in
such manner as the Board of Directors from time to time may determine.
Section 5.05 Bonds and Debentures. Every bond or debenture issued by the
corporation shall be evidenced by an appropriate instrument which shall be
signed by the president or vice president and by the secretary and sealed with
the seal of the corporation. The seal may be a facsimile, engraved or printed.
where such bond or debenture is authenticated with the manual signature of an
authorized officer of the corporation or other trustee designated by the
indenture of trust or other agreement under which such security is issued, the
signature of any of the corporation's officers named thereon may be a facsimile.
In case any officer who signed, or whose facsimile signature has been used on
any such bond or debenture, should cease to be an officer of the corporation for
any reason before the same has been delivered by the corporation, such bond or
debenture may nevertheless be adopted by the corporation and issued and
delivered as through the person who signed it or whose facsimile signature has
been used thereon had not ceased to be such officer.
Section 5.06 Sale, Transfer, Etc. of Securities. Sales, transfers,
endorsements, and assignments of stocks, bonds, and other securities owned by or
standing in the name of the corporation, and the execution and delivery on
behalf of the corporation of any and all instruments in writing incident to any
such sale, transfer, endorsement, or assignment, shall be effected by the
president, or by any vice president, together with the secretary, or by an
officer or agent thereunto authorized by the Board of Directors.
Section 5.07 Proxies. Proxies to vote with respect to shares of other
corporations owned by or standing in the name of the corporation shall be
executed and delivered on behalf of the corporation by the president or any vice
president and the secretary or assistant secretary of the corporation, or by any
officer or agent thereunder authorized by the Board of Directors.
<PAGE>
ARTICLE VI
CAPITAL SHARES
Section 6.01 Share Certificates. Every holder of shares in the
corporation shall be entitled to have a certificate, signed by the president or
any vice president, and the secretary or assistant secretary, and sealed with
the seal (which may be a facsimile, engraved or printed) of the corporation,
certifying the number and kind, class or series of shares owned by him or her in
the corporation; provided, however, that where such a certificate is
countersigned by (a) a transfer agent or an assistant transfer agent, or (b)
registered by a registrar, the signature of any such president, vice president,
secretary, or assistant secretary may be a facsimile. In case any officer who
shall have signed, or whose facsimile signature or signatures shall have been
used on any such certificate, shall cease to be officer of the corporation, for
any reason, before the delivery of such certificate by the corporation, such
certificate may nevertheless be adopted by the corporation and be issued and
delivered as though the person who signed it, or whose facsimile signature or
signatures shall have been used thereon, has not ceased to be such officer.
Certificates representing shares of the corporation shall be in such form as
provided by the statutes of the state of incorporation. There shall be entered
on the share books of the corporation at the time of issuance of each share, the
number of the certificate issued, the name and address of the person owning the
shares represented thereby, the number and kind, class or series of such shares,
and the date of issuance thereof. Every certificate exchanged or returned to the
corporation shall be marked "Canceled" with the date of cancellation.
Section 6.02 Transfer of Shares. Transfers of shares of the corporation
shall be made on the books of the corporation by the holder of record thereof,
or by his or her attorney thereunto duly authorized by a power of attorney duly
executed in writing and filed with the secretary of the corporation or any of
its transfer agents, and on surrender of the certificate or certificates,
properly endorsed or accompanied by proper instruments or transfer, representing
such shares. Except as provided by law, the corporation and transfer agents and
registrars, if any, shall be entitled to treat the holder of record of any stock
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
shares on the part of any other person whether or not it or they shall have
express or other notice thereof.
Section 6.03 Regulations. Subject to the provisions of this Article VI
and of the Articles of Incorporation, the Board of Directors may make such rules
and regulations as they may deem expedient concerning the issuance, transfer,
redemption, and registration of certificates for shares of the corporation.
Section 6.04 Maintenance of Stock Ledger at Principal Place of Business.
A share book (or books where more than one kind, class, or series or stock is
outstanding) shall be kept at the principal place of business of the
corporation, or at such other place as the Board of Directors shall determine,
containing the names, alphabetically arranged, of original shareholders of the
corporation, their addresses, their interest, the amount paid on their shares,
and all transfers thereof and the number and class of shares held by each. Such
share books shall at all reasonable hours be subject to inspection by persons
entitled by law to inspect the same.
Section 6.05 Transfer Agents and Registrars. The Board of Directors may
appoint one or more transfer agents and one or more registrars with respect to
the certificates representing shares of the corporation, and may require all
such certificates to bear the signature of either or both. The Board of
Directors may from time to time define the respective duties of such transfer
agents and registrars. No certificate for shares shall be valid until
countersigned by a transfer agent, if at the date appearing thereon the
corporation had a transfer agent for such shares, and until registered by a
registrar, if at such date the corporation had a registrar for such shares.
<PAGE>
Section 6.06 Closing of Transfer Books and Fixing of Record Date.
---------------------------------------------------
(a) The Board of Directors shall have power to close the share books of
the corporation for a period of not to exceed fifty (50) days preceding the date
of any meeting of shareholders, or the date for payment of any dividend, or the
date for the allotment of rights, or capital shares shall go into effect, or a
date in connection with obtaining the consent of shareholder for any purpose.
(b) In lieu of closing the share transfer books as aforesaid, the Board
of Directors may fix in advance a date, not exceeding fifty (50) days preceding
the date of any meeting of shareholders, or the date for the payment of any
dividend, or the date for the allotment of rights, or the date when any change
or conversion or exchange of capital shares shall go into effect, or a date in
connection with obtaining any such consent, as a record date for the
determination of the shareholders entitled to a notice of, and to vote at, any
such meeting and any adjournment thereof, or entitled to receive payment of any
such dividend, or to any such allotment of rights, or exercise the rights in
respect of any such change, conversion or exchange of capital stock, or to give
such consent.
(c) If the share transfer books shall be closed or a record date set for
the purpose of determining shareholders entitled to notice of or to vote at a
meeting of shareholders, such books shall be closed for, or such record date
shall be, at least ten (10) days immediately preceding such meeting.
Section 6.07 Lost or Destroyed Certificates. The corporation may issue a
new certificate for shares of the corporation in place of any certificate
theretofore issued by it, alleged to have been lost or destroyed, and the Board
of Directors may, in its discretion, require the owner of the lost or destroyed
certificate or his or her legal representatives, to give the corporation a bond
in such form and amount as the Board of Directors may direct, and with such
surety or sureties as may be satisfactory to the board, to indemnify the
corporation and its transfer agents and registrars, if any, against any claims
that may be made against it or any such transfer agent or registrar on account
of the issuance of such new certificate. A new certificate may be issued without
requiring any bond when, in the judgement of the Board of Directors, it is
proper to do so.
Section 6.08 No Limitation on Voting Rights; Limitation on Dissenter's
Rights. To the extent permissible under the applicable law of any jurisdiction
to which the corporation may become subject by reason of the conduct of
business, the ownership of assets, the residence of shareholders, the location
of offices or facilities, or any other item, the corporation elects not to be
governed by the provisions of any statute that (i) limits, restricts, modifies,
suspends, terminates, or otherwise affects the rights of any shareholder to cast
one vote for each share of common stock registered in the name of such
shareholder on the books of the corporation, without regard to whether such
shares were acquired directly from the corporation or from any other person and
without regard to whether such shareholder has the power to exercise or direct
the exercise of voting power over any specific fraction of the shares of the
corporation or from any other person and without regard to whether such
shareholder has the power to exercise or direct the exercise of voting power
over any specific fraction of the shares of common stock of the corporation
issued and outstanding or (ii) grants to any shareholder the right to have his
or her stock redeemed or purchased by the corporation or any other shareholder
on the acquisition by any person or group of persons of shares of the
corporation. In particular, to the extent permitted under the laws of the state
of incorporation, the corporation elects not to be governed by any such
provision, including the provisions of the Utah Control Shares Acquisition Act,
Section 61-6-1 et seq., of the Utah Code Annotated, as amended, or any statute
of similar effect or tenor.
<PAGE>
ARTICLE VII
EXECUTIVE COMMITTEE AND OTHER COMMITTEES
Section 7.01 How Constituted. The Board of Directors may designate an
executive committee and such other committees as the Board of Directors may deem
appropriate, each of which committees shall consist of two or more directors.
Members of the executive committee and of any such other committees shall be
designated annually at the annual meeting of the Board of Directors; provided,
however, that at any time the Board of Directors may abolish or reconstitute the
executive committee or any other committee. Each member of the executive
committee and of any other committee shall hold office until his or her
successor shall have been designated or until his or her resignation or removal
in the manner provided in these Bylaws.
Section 7.02 Powers. During the intervals between meetings of the Board
of Directors, the executive committee shall have and may exercise all powers of
the Board of Directors in the management of the business and affairs of the
corporation, except for the power to fill vacancies in the Board of Directors or
to amend these Bylaws, and except for such powers as by law may not be delegated
by the Board of Directors to an executive committee.
Section 7.03 Proceedings. The executive committee, and such other
committees as may be designated hereunder by the Board of Directors, may fix its
own presiding and recording officer or officers, and may meet at such place or
places, at such time or times and on such notice (or without notice) as it shall
determine from time to time. It will keep a record of its proceedings and shall
report such proceedings to the Board of Directors at the meeting of the Board of
Directors next following.
Section 7.04 Quorum and Manner of Acting. At all meetings of the
executive committee, and of such other committees as may be designated hereunder
by the Board of Directors, the presence of members constituting a majority of
the total authorized membership of the committee shall be necessary and
sufficient to constitute a quorum for the transaction of business, and the act
of a majority of the members present at any meeting at which a quorum is present
shall be the act of such committee. The members of the executive committee, and
of such other committees as may be designated hereunder by the Board of
Directors, shall act only as a committee and the individual members thereof
shall have not powers as such.
Section 7.05 Resignations. Any member of the executive committee, and of
such other committees as may be designated hereunder by the Board of Directors,
may resign at any time by delivering a written resignation to either the
president, the secretary, or assistant secretary, or to the presiding officer of
the committee of which he or she is a member, if any shall have been appointed
and shall be in office. Unless otherwise specified herein, such resignation
shall take effect on delivery.
Section 7.06 Removal. The Board of Directors may at any time remove any
member of the executive committee or of any other committee designated by it
hereunder either for or without cause.
Section 7.07 Vacancies. If any vacancies shall occur in the executive
committee or any other committee designated by the Board of Directors hereunder,
by reason of disqualification, death, resignation, removal, or otherwise, the
remaining members shall, until the filling of such vacancy, constitute the then
total authorized membership of the committee and, provided that two or more
members are remaining, continue to act. Such vacancy may be filled at any
meeting of the Board of Directors.
Section 7.07 Compensation. The Board of Directors may allow a fixed sum
and expenses of attendance to any member of the executive committee, or of any
other committee designated by it hereunder, who is not an active salaried
employee of the corporation for attendance at each meeting of said committee.
<PAGE>
ARTICLE VIII
INDEMNIFICATION, INSURANCE, AND
OFFICER AND DIRECTOR CONTRACTS
Section 8.01 Indemnification: Third Party Actions. The corporation shall
have the power to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending, or completed action, or suit by or
in the right of the corporation to procure a judgement in its favor by reason of
the fact that he or she is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys' fees)
judgments, fines, and amounts paid in settlement actually and reasonably
incurred by him or her in connection with any such action, suit or proceeding,
if he or she acted in good faith and in a manner he or she reasonably believed
to be in or not opposed to the best interest of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his or her conduct was unlawful. The termination of any action, suit, or
proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the person did not act in good faith and in a manner which he or she reasonably
believed to be in or not opposed to the best interests of the corporation, and
with respect to any criminal action or proceeding, he or she had reasonable
cause to believe that his or her conduct was unlawful.
Section 8.02 Indemnification: Corporate Actions. The corporation shall
have the power to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending, or completed action or suit by or in
the right of the corporation to procure a judgment in its favor by reason of the
fact that he or she is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise, against expenses (including attorneys'
fees) actually and reasonably incurred by him or her in connection with the
defense or settlement of such action or suit, if he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the corporation, except that no indemnification shall be made
in respect of any claim, issue, or matter as to which such a person shall have
been adjudged to be liable for negligence or misconduct in the performance of
his or her duty to the corporation, unless and only to the extent that the court
in which the action or suit was brought shall determine on application that,
despite the adjudication of liability but in view of all circumstances of the
case, the person is fairly and reasonably entitled to indemnity for such
expenses as the court deems proper.
<PAGE>
Section 8.03 Determination. To the extent that a director, officer,
employee, or agent of the corporation has been successful on the merits or
otherwise in defense of any action, suit, or proceeding referred to in Sections
8.01 and 8.02 hereof, or in defense of any claim, issue, or matter therein, he
or she shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by him or her in connection therewith. Any
other indemnification under Sections 8.01 and 8.02 hereof, shall be made to the
corporation upon a determination that indemnification of the officer, director,
employee, or agent is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in Sections 8.01 and 8.02 hereof. Such
determination shall be made either (i) by the Board of Directors by a majority
of a quorum consisting of directors who were not parties to such action, suit,
or proceeding; or (ii) by independent legal counsel on a written opinion; or
(iii) by the shareholders by a majority vote of a quorum of shareholders at any
meeting duly called for such purpose.
Section 8.04 General Indemnification. The indemnification provided by
this Section shall not be deemed exclusive of any other indemnification granted
under any provision of any statute, in the corporation's Articles of
Incorporation, these Bylaws, agreement, vote of shareholders or disinterested
directors, or otherwise, both as to action in his or her official capacity and
as to action in another capacity while holding such office, and shall continue
as to a person who has ceased to be a director, officer, employee, or agent, and
shall inure to the benefit of the heirs and legal representatives of such a
person.
Section 8.05 Advances. Expenses incurred in defending a civil or
criminal action, suit or proceeding as contemplated in this Section may be paid
by the corporation in advance of the final disposition of such action, suit, or
proceeding upon a majority vote of a quorum of the Board of Directors and upon
receipt of an undertaking by or on behalf of the director, officers, employee,
or agent to repay such amount or amounts unless if it is ultimately determined
that he or she is to be indemnified by the corporation as authorized by this
Section.
Section 8.06 Scope of Indemnification. The indemnification authorized by
this Section shall apply to all present and future directors, officers,
employees, and agents of the corporation and shall continue as to such persons
who cease to be directors, officers, employees, or agents of the corporation,
and shall inure to the benefit of the heirs, executors, and administrators of
all such persons and shall be in addition to all other indemnification permitted
by law.
8.07 Insurance. The corporation may purchase and maintain insurance on
behalf of any person who is or was a director, employee, or agent of the
corporation, or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust, or other enterprise against any liability asserted against him
or her and incurred by him or her in any such capacity, or arising out of his or
her status as such, whether or not the corporation would have the power to
indemnify him or her against any such liability and under the laws of the state
of incorporation, as the same may hereafter be amended or modified.
<PAGE>
ARTICLE IX
FISCAL YEAR
The fiscal year of the corporation shall be fixed by resolution of the
Board of Directors.
ARTICLE X
DIVIDENDS
The Board of Directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and on
the terms and conditions provided by the Articles of Incorporation and these
Bylaws.
ARTICLE XI
AMENDMENTS
All Bylaws of the corporation, whether adopted by the Board of Directors
or the shareholders, shall be subject to amendment, alteration, or repeal, and
new Bylaws may be made, except that;
(a) No Bylaws adopted or amended by the shareholders shall be altered or
repealed by the Board of Directors;
(b) No Bylaws shall be adopted by the Board of Directors which shall
require more than a majority of the voting shares for a quorum at a meeting of
shareholders, or more than a majority of the votes cast to constitute action by
the shareholders, except where higher percentages are required by law; provided,
however that (I) if any Bylaw regulating an impending election of directors is
adopted or 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 Bylaws so adopted or amended or repealed, together with a concise
statement of the changes made; and (ii) no amendment, alteration or repeal of
this Article XI shall be made except by the shareholders.
CERTIFICATE OF SECRETARY
The undersigned does hereby certify that he or she is the secretary of
Wasatch Web Advisors, Inc., a corporation duly organized and existing under and
by virtue of the laws of the State of Utah; that the above and foregoing bylaws
of said corporation were duly and regularly adopted as such by the Board of
Directors of the corporation at a meeting of the board of Directors, which was
duly and regularly held on the 12 day of September, 1999 and that the above and
foregoing Bylaws are now in full force and effect.
DATED this 12th day of September, 1999.
/S/ ALYCIA ANTHONY
Alycia Anthony, Secretary
