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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB/A-1
GENERAL FORM FOR REGISTRATION OF SECURITIES
OF SMALL BUSINESS ISSUERS UNDER SECTION 12(b)
OR 12(g) OF THE SECURITIES ACT OF 1934
SEMINAR STRATEGIES & MARKETING, INC.
(Exact name of small business issuer in its charter)
NEVADA
(State or other jurisdiction of incorporation)
86-0972563
(I.R.S. Employer Identification No.)
10130 East Winding Trail
Tucson, Arizona 85749
(520) 577-1516
(Address and telephone number of principal executive offices)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.001
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PART I
ITEM 1. DESCRIPTION OF BUSINESS.
Since its inception on July 25, 1997, SEMINAR STRATEGIES & MARKETING, INC. a
Nevada corporation (the "Company") has not engaged in any operations other than
organizational matters. It was formed specifically to be a "blank check" or
"clean public shell" corporation, for the purpose of either merging with or
acquiring an operating company with operating history and assets. The Company is
a "clean public shell" because it has not commenced operational activities, and
has no debt liabilities. The Company has not been involved in any litigation nor
has it had any prior regulatory problems or business failures. We believe that a
strong attraction of the Company as a merger partner or acquisition vehicle will
be its status as a reporting public company without any history of prior
business failures, litigation or prior regulatory problems.
The executive offices of the Company are located at 10130 East Winding Trail,
Tucson, Arizona 85749. Its telephone number is (520) 577-1516. The President,
Secretary and sole director of the Company is Daniel L. Hodges.
Mr. Hodges was not the original incorporator of the Company. Mr. Hodges retained
the services of a third party to incorporate or provide already incorporated
Nevada and Wyoming companies. Subsequent to incorporation, the original
incorporator resigned as director and Mr. Hodges was appointed as sole officer
and director of the Company. Mr. Hodges continues to be the sole officer and
director of the Company and majority shareholder.
As the sole director, Mr. Hodges has commenced implementation of the Company's
principal business purpose, which is to seek merger or acquisition candidates.
The Company intends to seek to acquire assets or shares of an entity actively
engaged in business which generates revenues, in exchange for its securities.
The Company has not selected any company as an acquisition or merger candidate
and does not intend to limit itself to any particular field or industry, but
does, in its sole discretion, retain the right to do so. The Company's plans are
in the conceptual stage only. There is no relationship between the particular
name of the Company and the Company's intended business plan. If successful in
completing a merger or acquisition, the Company expects that it would change its
name to reflect the marketing goals of the business combination.
As is described fully in Item 5 herein, Mr. Hodges has had a controlling
interest in numerous shell companies which have effected mergers or acquisitions
similar to that which the Company will be seeking. In these situations, Mr.
Hodges has typically sold his controlling interests in the shell companies for
cash. The other shareholders of the shell companies received interests in the
applicable new company as a result of the merger or acquisition.
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COMPETITION
The Company is an insignificant participant which competes among firms which
engage in business combinations with, or financing of, development stage
enterprises. There are many established management and financial consulting
companies and venture capital firms which have significantly greater financial
and personnel resources, technical expertise and experience than the Company in
this field. In view of the Company's limited financial resources and management
availability, the Company continues to be at a significant competitive
disadvantage.
REGULATION AND TAXATION
The Company intends to structure a merger or acquisition in such a manner as to
minimize federal and state tax consequences to the Company and to any target
company.
PATENTS
The Company owns no patents and no Internet domain names.
EMPLOYEES
The Company has no full-time or part-time employees. Mr. Hodges, the sole
officer and director of the Company, has agreed to allocate a nominal portion of
his time to the activities of the Company without compensation.
LEGAL PROCEEDINGS
The Company is not subject to any pending litigation, legal proceedings or
claims.
RISK FACTORS
The Company's business is subject to numerous risk factors, including the
following:
THE COMPANY HAS ONLY ONE DIRECTOR AND ONE OFFICER.
The Company's president and sole officer is Daniel L. Hodges. Mr. Hodges is the
sole director and the majority shareholder. Because management consists of only
Mr. Hodges, the Company does not benefit from multiple judgments that a greater
number of directors or officers would provide. The Company must rely completely
on the judgment of its sole officer and director when selecting a target
company. The decision to enter into a business combination will likely be made
without detailed feasibility studies, independent analysis, market surveys or
similar information which, if the Company had more funds available to it, would
be desirable. Mr. Hodges anticipates devoting only a nominal amount of time per
month to the business of the Company. Mr. Hodges has not entered into a written
employment agreement with the Company and he is not expected to do so. The
Company has not obtained key man life insurance on Mr. Hodges. The loss of the
services of Mr. Hodges would adversely affect development of the Company's
business and its likelihood of continuing operations.
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THE COMPANY HAS NO OPERATING HISTORY, NO REVENUE, MINIMAL ASSETS
AND OPERATES AT A LOSS.
The Company has no operating history or any revenues or earnings from
operations. The Company has no significant assets or financial resources. The
Company has operated at a loss to date and will, in all likelihood, continue to
have operating expenses without corresponding revenues, at least until the
consummation of a business combination. As of March 31, 2000, the Company had
incurred expenses of approximately $3,800. Mr. Hodges has paid these expenses
and he has no expectation or agreement with the Company for reimbursement for
those expenses. There is no assurance that the Company will ever be profitable.
MR. HODGES MAY HAVE CONFLICTS OF INTEREST WITH THE COMPANY.
The terms of any future business combination involving the Company may include
such terms as Mr. Hodges' remaining a director or officer of the Company
following the business combination. However, the terms of a business combination
may provide for a payment by cash, securities or otherwise to Mr. Hodges for the
purchase or retirement of all or part of his common stock of the Company by a
target company or for services rendered incident to or following a business
combination. Mr. Hodges would directly benefit from such employment or payment.
These benefits may influence Mr. Hodges' choice of a target company. In
addition, the Articles of Incorporation of the Company provide that the Company
indemnify its officers and/or directors for liabilities, which can include
liabilities arising under the securities laws. Therefore, assets of the Company
could be used or attached to satisfy any liabilities subject to such
indemnification.
As is described fully in Item 5 herein, Mr. Hodges has had a controlling
interest in numerous shell companies which have effected mergers or acquisitions
similar to that which the Company will be seeking. In these situations, Mr.
Hodges has typically sold his controlling interests in the shell companies for
cash. The other shareholders of the shell companies received interests in the
applicable new company as a result of the merger or acquisition.
In addition, Mr. Hodges has participated or is currently participating in other
blank check companies which may compete directly with the Company. See Item 5
for a listing of these companies. Additional conflicts of interest and non-arm's
length transactions may also arise in the future. As of the date of this
prospectus, Mr. Hodges has been or currently is involved with 130 shell
companies, approximately 110 of which are or will be seeking business
opportunities for mergers or acquisitions. Consequently, there are potential
inherent conflicts of interest in Mr. Hodges' acting as officer and director of
the Company. Conflicts could also arise if the Company were to enter into any
business combination with a company in which Mr. Hodges is involved. This type
of business transaction is not an arm's-length transaction because of Mr.
Hodges' potential involvement with both parties. While there is no policy
prohibiting such a transaction, the Company currently does not intend to engage
in a business combination of this type.
Many states, including Nevada where the Company is incorporated, have enacted
laws to address breaches of fiduciary duties of management when conflicts of
interest become problematic. You
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should note that shareholders' pursuit of remedies under state laws can be
prohibitively expensive and time consuming.
THE COMPANY'S PROPOSED OPERATIONS ARE SPECULATIVE.
The success of the Company's proposed plan of operation will depend to a great
extent on the operations, financial condition and management of the
not-yet-identified target company. While business combinations with entities
having established operating histories are preferred, we cannot guarantee that
the Company will be successful in locating candidates meeting such criteria. In
the event the Company does complete a business combination, the success of the
Company's operations will be dependent upon the management of the target company
and numerous other factors beyond the Company's control. There is no assurance
that the Company can identify a target company and consummate a business
combination.
THE PURCHASE OF PENNY STOCKS CAN BE RISKY.
In the event that a public trading market develops for the Company's shares
following a business combination, such securities may be classified as a "penny
stock" depending upon their market price and the manner in which they are
traded. Section 3(a)(51) of the Securities Exchange Act of 1934 defines a "penny
stock," for purposes relevant to the Company, as any equity security that has a
market price of less than $5.00 per share and is not admitted for quotation and
does not trade on the Nasdaq Stock Market or on a national securities exchange.
For any transaction involving a penny stock, unless exempt, the rules require
delivery by the broker of a document to investors stating the risks of
investment in penny stocks, the possible lack of liquidity, commissions to be
paid, current quotations and investors' rights and remedies, a special
suitability inquiry, regular reporting to the investor and other requirements.
Prices for penny stocks are often not available and investors are often unable
to sell such stock. Thus an investor may lose his entire investment in a penny
stock and consequently should be cautious of any purchase of penny stocks.
THERE IS A SCARCITY OF, AND SIGNIFICANT COMPETITION FOR, BUSINESS OPPORTUNITIES
AND COMBINATIONS.
The Company is and will continue to be an insignificant participant in the
business of seeking mergers with and acquisitions of business entities. A large
number of established and well-financed companies, including venture capital
firms, are active in mergers and acquisitions of companies which may be merger
or acquisition target candidates for the Company. Nearly all of these other
participants have greater financial resources, technical expertise and
managerial capabilities than the Company. Consequently, the Company will be at a
competitive disadvantage in identifying possible business opportunities and
successfully completing a business combination. Moreover, the Company will also
compete with numerous other small public companies in seeking merger or
acquisition candidates. As of the date of this prospectus, Mr. Hodges has been
or currently is involved with 130 shell companies, approximately 110 of which
are or will be seeking business opportunities for mergers or acquisitions.
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CURRENTLY, THERE IS NO AGREEMENT FOR A BUSINESS COMBINATION WITH THE COMPANY AND
NO MINIMUM REQUIREMENTS FOR A BUSINESS COMBINATION.
The Company has no current arrangement, agreement or understanding with respect
to engaging in a business combination with any specific entity. We cannot
guarantee that the Company will be successful in identifying and evaluating any
suitable business opportunities or in concluding a business combination. We have
not selected any particular industry or specific business within an industry as
a potential target company. The Company has not established any criteria,
including a specific length of operating history or a specified level of
earnings, assets, and/or net worth, which it will require a target company to
have achieved, or without which the Company would not consider a business
combination with such business entity. Accordingly, the Company may enter into a
business combination with a business entity having no significant operating
history, losses, limited or no potential for immediate earnings, limited assets,
negative net worth or other negative characteristics. We cannot guarantee you
that the Company will be able to negotiate a business combination on terms
favorable to the Company.
WE MAY BE DELAYED OR PRECLUDED FROM AN ACQUISITION BY REPORTING REQUIREMENTS.
Pursuant to the requirements of Section 13 of the Securities Exchange Act of
1934, the Company is required to provide certain information about significant
acquisitions including audited financial statements of the acquired company.
These audited financial statements must be furnished within 75 days following
the effective date of a business combination. The information about they merger
or acquisition and the audited financials will be reported by the Company on
Form 8-K.
The target company will have the obligation for obtaining audited financial
statements. The additional time and costs for some potential target companies to
prepare financial statements may significantly delay or essentially preclude
consummation of an otherwise desirable acquisition by the Company. Acquisition
prospects that do not have, or are unable to obtain, the required audited
statements may not be appropriate for acquisition so long as the reporting
requirements of the Exchange Act are applicable. Notwithstanding a target
company's agreement to obtain audited financial statements within the required
time frame, these audited financials may not be available to the Company at the
time of effecting a business combination. In cases where audited financials are
unavailable, the Company will have to rely upon unaudited information that has
not been verified by outside auditors in making its decision to engage in a
transaction with the business entity. This risk increases the prospect that a
business combination with such a business entity might prove to be an
unfavorable one for the Company.
After the consummation of the merger or acquisition, if Mr. Hodges does not
assume a director or officer position with the new company, he will have no
legal or other obligation or responsibility for the reporting requirements of
the new company. All obligations and responsibilities will reside with the
management of the new company.
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WE LACK MARKET RESEARCH AND MARKETING ORGANIZATION.
The Company has not conducted, and others have not made available to the
Company, market research indicating that demand exists for the transactions we
contemplate. Even in the event demand exists for a transaction of the type
contemplated by the Company, there is no assurance the Company will be
successful in completing any such business combination. As of the date of this
prospectus, Mr. Hodges has been or currently is involved with 130 shell
companies, approximately 110 of which are or will be seeking business
opportunities for mergers or acquisitions.
WE LIKELY WILL HAVE A CHANGE IN CONTROL AND MANAGEMENT FOLLOWING A BUSINESS
COMBINATION.
A business combination involving the issuance of the Company's common stock
will, in all likelihood, result in shareholders of a target company obtaining a
controlling interest in the Company. As a condition of the business combination
agreement, Mr. Hodges may agree to sell or transfer all or a portion of his
common stock to provide the target company with all or majority control of the
Company. The resulting change in control of the Company will occur without your
vote and will likely result in removal of Mr. Hodges as the present sole officer
and director of the Company and a corresponding reduction in or elimination of
his participation in the future affairs of the Company.
A BUSINESS COMBINATION WILL POSSIBLY DILUTE THE VALUE OF THE COMPANY'S SHARES.
A business combination normally will involve the issuance of a significant
number of additional shares of the Company's common stock. Depending upon the
value of the assets acquired in the business combination, the per share value of
the Company's common stock may increase or decrease, perhaps significantly.
THERE ARE STATE AND FEDERAL REGULATIONS WHICH MIGHT AFFECT THE TRANSFERABILITY
OF THE COMPANY'S SHARES.
The Company has not registered its shares for resale under the securities or
"blue sky" laws of any state and has no plans to register or qualify its shares
in any state. Current shareholders, and persons who desire to purchase the
shares in any trading market that may develop in the future, should be aware
that there may be significant state restrictions upon the ability of new
investors to purchase the securities.
Blue sky laws, regulations, orders, or interpretations place limitations on
offerings or sales of securities by "blank check" companies, or in "blind-pool"
offerings, or if such securities represent "cheap stock" previously issued to
promoters or others. These limitations typically provide, in the form of one or
more of the following limitations, that such securities are:
- not eligible for sale under exemption provisions permitting sales
without registration to accredited investors or qualified
purchasers;
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- not eligible for the transactional exemption from registration for
nonissuer transactions by a registered broker-dealer;
- not eligible for registration under the simplified small corporate
offering registration (SCOR) form available in many states;
- not eligible for the "solicitations of interest" exception to
securities registration requirements available in many states;
- required to be placed in escrow and the proceeds received held in
escrow subject to various limitations; or
- not permitted to be registered or exempted from registration, and
thus not permitted to be sold in the state under any
circumstances.
Virtually all 50 states have adopted one or more of these limitations, or other
limitations or restrictions affecting the sale or resale of stock of blank check
companies, or securities sold in "blind pool" offerings or "cheap stock" issued
to promoters or others. Specific limitations on offerings by blank check
companies (or companies meeting such a definition, i.e., having no current
business operations and no specific business plan or purpose) have been adopted
in:
Alaska Nevada Tennessee
Arkansas New Mexico Texas
California Ohio Utah
Delaware Oklahoma Vermont
Florida Oregon Washington
Georgia Pennsylvania
Idaho Rhode Island
Indiana South Carolina
Nebraska South Dakota
The Company's selling efforts, and any secondary trading market which may
develop, may only be conducted in those jurisdictions where an applicable
exemption is available or where the shares have been registered. The Company has
no current plan to register its shares in any state and does not anticipate
doing so until after the consummation of a merger or acquisition, after which it
will no longer be classified as a blank check company. The Company has not
taken, and does not contemplate taking, any steps to ensure compliance with
state securities laws.
There also may be restrictions on resale of the shares under federal law. The
Division of Corporation Finance of the SEC is of the view that none of the
shares of the Company are 'freely transferable,' but the SEC itself has not
officially expressed any views on this matter.
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A BUSINESS COMBINATION MAY RESULT IN UNFAVORABLE TAXATION TO THE COMPANY.
Federal and state tax consequences will, in all likelihood, be major
considerations in any business combination the Company may undertake. Currently,
such transactions may be structured so as to result in tax-free treatment to
both companies, pursuant to various federal and state tax provisions. The
Company intends to structure any business combination so as to minimize the
federal and state tax consequences to both the Company and the target company.
However, there can be no assurance that such business combination will meet the
statutory requirements of a tax-free reorganization or that the parties will
obtain the intended tax-free treatment upon a transfer of stock or assets. A
non-qualifying reorganization could result in the imposition of both federal and
state taxes which may have an adverse effect on both parties to the transaction
and their shareholders.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION.
PLAN OF OPERATIONS - GENERAL
The Company was organized for the purpose of creating a corporate vehicle to
seek, investigate and, if such investigation warrants, acquire an interest in
one or more business opportunities presented to it by persons or firms who or
which desire to seek perceived advantages of a publicly held corporation. At
this time, the Company has no plan, proposal, agreement, understanding or
arrangement to acquire or merge with any specific business or company, and the
Company has not identified any specific business or company for investigation
and evaluation. Mr. Hodges, the Company's sole officer and director, has not had
any material discussions with any company with respect to the acquisition of
that company.
The Company will not restrict its search to any specific business, industry or
geographical location, and the Company may participate in a business venture of
virtually any kind or nature. Our discussion of the proposed business of the
Company is purposefully general and is meant to demonstrate the Company's
virtually unlimited discretion to search for and enter into potential business
opportunities.
SOURCES OF OPPORTUNITIES
The Company does not intend to actively seek out investors. Rather, the Company
seeks to merge with or acquire assets or shares of an entity which is already
actively engaged in a business that generates revenues, in exchange for the
Company's common stock. Mr. Hodges expects that upon successful regulatory
clearance of this Form 10-SB, he will be contacted by a number of target
companies.
In addition, the Company anticipates that business opportunities will be
referred to it by various sources, including Mr. Hodges, professional advisers,
securities broker-dealers, venture capitalists, members of the financial
community, and others who may present unsolicited proposals. The Company will
seek a potential business opportunity from all known sources, but
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will rely principally on personal contacts of Mr. Hodges as well as indirect
associations between him and other business and professional people. We can not
predict the number of individuals or companies who may approach Mr. Hodges about
the Company.
The Company will not enter into a business combination with a company in which
Mr. Hodges or his affiliates or associates has a current ownership interest.
However, there is no policy, corporate bylaw or shareholder resolution
prohibiting the Company from merging or acquiring a business, asset or company
in which any potential promoter, affiliate or associate of the Company or Mr.
Hodges has any direct or indirect ownership.
The Company does not currently plan to engage professional firms specializing in
business acquisitions or reorganizations; however the Company has not formulated
any policy regarding the use of consultants or outside advisors. In addition,
the Company has not, and does not intend to, advertise in search of business
opportunities. However, the Company may, in the future, advertise and promote
itself in financial newspapers, magazines and on the Internet.
The Company may seek a business opportunity with a firm that only recently
commenced operations, or a developing company in need of additional funds for
expansion into new products or markets, or an established company seeking a
public vehicle. In some instances, a business opportunity may involve the
acquisition or merger with a corporation which does not need substantial
additional cash but which desires to establish a public trading market for its
common stock. The Company may purchase assets and establish wholly owned
subsidiaries in various businesses or purchase existing businesses as
subsidiaries.
The Company anticipates that its selection of a business opportunity in which to
participate may be complex and extremely risky. Because of general economic
conditions, rapid technological advances being made in some industries and
shortages of available capital, Mr. Hodges believes that there are numerous
firms seeking the benefits of a publicly traded corporation like the Company.
The perceived benefits of a publicly traded corporation may include facilitating
or improving the terms on which additional equity financing may be sought,
providing liquidity for the principals of a business, creating a means for
providing incentive stock options or similar benefits to key employees,
providing liquidity (subject to restrictions of applicable statues) for all
shareholders, and other factors. Potentially available business opportunities
may occur in many different industries and at various stages of development, all
of which will make the task of comparative investigation and analysis of such
business opportunities extremely difficult and complex.
The Company has, and will continue to have, insufficient capital with which to
provide the owners of potential target companies with any significant cash or
other assets. However, Mr. Hodges believes the Company will offer owners of
business opportunities the opportunity to acquire a controlling ownership
interest in a public company at substantially less cost than is required to
conduct an initial public offering. The owners of the business opportunities
will, however, incur significant post-merger or acquisition registration costs
in the event they wish to register a portion of their shares for subsequent
sale. The target company will also incur significant legal and accounting costs
in connection with the business combination including the costs of preparing
post-effective amendments, Forms 8-K, agreements and related reports and
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documents. However, Mr. Hodges has not conducted market research and is not
aware of statistical data which would support the perceived benefits of a merger
or acquisition transaction for the owners of a business opportunity.
EVALUATION OF OPPORTUNITIES
The analysis of new business opportunities will be undertaken by, or under the
supervision of, Mr. Hodges. Mr. Hodges will be the key person in the search,
review and negotiation with potential acquisition or merger candidates. While
Mr. Hodges likely has no quantifiable experience in the businesses of any
particular target companies that may be reviewed, he has experience in managing
development stage companies similar to the Company. Mr. Hodges will rely upon
his own efforts in accomplishing the business purposes of the Company. Mr.
Hodges is currently employed in other positions and will devote only a nominal
portion of his time to the business affairs of the Company, until such time as
an acquisition has been determined to be highly favorable. After that time,
however, Mr. Hodges expects to spend full time in investigating and closing any
acquisition. In addition, in the face of competing demands for his time, Mr.
Hodges may grant priority to his other positions rather than to the Company.
For example, in analyzing prospective business opportunities, Mr. Hodges will
consider the following matters:
- the available technical, financial and managerial resources;
working capital and other financial requirements of the target;
- the target's history of operations, if any;
- the target's prospects for the future;
- the present and expected competition in the target's industry;
- the quality and experience of management services which may be
available and the depth of that management within the target;
- the potential for further research, development or exploration in
the target's industry;
- specific risk factors which may be anticipated to impact the
proposed activities of the Company;
- the potential for growth or expansion and profit;
- the perceived public recognition or acceptance of products,
services or trades of the target and the industry and brand or
name identification; and
- all other relevant factors.
Mr. Hodges and/or his legal and financial advisers intend to meet personally
with management and key personnel of the firm sponsoring the business
opportunity as part of their investigation. To the extent possible, the Company
intends to utilize written reports and personal investigation to evaluate the
above factors. Mr. Hodges will personally pay for his meetings and expenses
while he is evaluating opportunities and he will not be reimbursed by the
Company for his time or expenses. The Company will not acquire or merge with any
company for which audited financial statements cannot be obtained.
Mr. Hodges is currently involved in promoting approximately 110 blank check
companies, many of which have registered their shares with the SEC under the
Securities and Exchange Act of
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1934. All of these companies are in various stages of searching for merger or
acquisition opportunities, and thus, there are potential inherent conflicts of
interest in Mr. Hodges' acting as officer and director of the Company and these
other companies. See Item 5 "Directors, Executive Officers, Promoters and
Control Persons" for a listing of companies in which Mr. Hodges is involved.
Insofar as he is engaged in other business activities, Mr. Hodges anticipates he
will devote only a nominal amount of time to the Company's affairs. In addition,
Mr. Hodges may in the future become a shareholder, officer or director of other
companies which may be formed for the purpose of engaging in business activities
similar to those conducted by the Company. Accordingly, additional direct
conflicts of interest may arise in the future with respect to such other
entities.
The Company does not currently have a right of first refusal pertaining to
opportunities that come to Mr. Hodges' attention insofar as such opportunities
may relate to the Company's proposed business operations. Mr. Hodges will
consider merger and/or acquisition opportunities and intends to make them
available to the Company and the companies that he is affiliated with on an
equal basis and in his sole discretion. The Company has not adopted any conflict
of interest policy with respect to these types of transactions. If a situation
arises in which more than one company with which Mr. Hodges is involved desires
to merge with or acquire a specific target company and the principals of the
proposed target company have no preference as to which company will merge or
acquire the target company, the company that first filed a registration
statement with the Securities and Exchange Commission will be entitled to
proceed with the proposed transaction.
ACQUISITION OF OPPORTUNITIES
The Company does not intend to make any loans to any prospective merger or
acquisition candidates or unaffiliated third parties. However, as is customary
in the industry, the Company may pay a finder's fee for persons locating and
introducing an acquisition prospect. In the event the Company consummates a
transaction with an entity introduced by a finder, we may compensate the finder
for the referral in the form of a finder's fee. If a finder's fee is paid, we
anticipate that the finder's fee will be either in the form of restricted common
stock issued by the Company as part of the terms of the proposed transaction, or
in the form of cash consideration. If the finder's fee is paid in the form of
common stock, the Board of Directors will approve this issuance. If the finder's
fee is in the form of cash, the payment will have to be tendered by the
acquisition or merger candidate because the Company has insufficient cash
available to make any fee payment. If any such fee is paid, it will be approved
by the Company's Board of Directors and will be in accordance with the industry
standards. Such fees are customarily between 1% and 5% of the size of the
transaction, based upon a sliding scale of the dollar amount involved. These
fees are typically in the range of 5% on a $1,000,000 transaction ratably down
to 1% in a $4,000,000 transaction.
As part of any transaction, the acquired company may require that Mr. Hodges or
other shareholders of the Company sell all or a portion of their shares to the
acquired company, or to the principals of the acquired company. The sales price
of these shares may be lower than the anticipated market price of the Company's
common stock at that time. The Company's shareholders will not be provided the
opportunity to approve or consent to such sale.
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Mr. Hodges may actively negotiate for the purchase of his common stock as a
condition to or in connection with a proposed merger or acquisition transaction.
Any terms of a sale of Mr. Hodges' shares may not be afforded to other
shareholders of the Company. The opportunity to sell all or a portion of his
shares in connection with an acquisition may influence Mr. Hodges' decision to
enter into a specific transaction. However, Mr. Hodges believes that since the
anticipated sales price will potentially be less than market value, the
potential of a stock sale will be a material factor in any decision to enter a
specific transaction. This description of potential sales of Mr. Hodges' stock
is not based upon any corporate bylaw, shareholder or board resolution, or
contract or agreement. No other payments of cash or property are expected to be
received by Mr. Hodges in connection with any acquisition.
In implementing a structure for a particular business acquisition, the Company
may become a party to a merger, consolidation, reorganization, joint venture,
franchise or licensing agreement with the target corporation. The Company may
also purchase stock or assets of the existing business. On the consummation of a
transaction, it is likely that the present management and shareholders of the
Company will not be in control of the Company. Mr. Hodges may, as part of the
terms of the acquisition transaction, resign and be replaced by new officers and
directors without a vote of the Company's shareholders. Except as may be
required by state or federal securities law applicable to the particular form of
transfer, the Company does not intend to provide its shareholders with any
complete disclosure documents, including a proxy statement and/or audited
financial statements, concerning an acquisition or merger candidate and its
business prior to the consummation of any acquisition or merger transaction.
A potential target might insist that the Company issue the target shares of the
Company's common stock as part of the business combination. We believe that any
stock that the Company might issue in any reorganization would be issued in
reliance on exemptions from registration under applicable federal and state
securities laws. In some circumstances, however, as a negotiated element of this
transaction, the Company may agree to register the shares either at the time the
transaction is consummated, under certain conditions or at specified time
thereafter. The issuance of substantial additional shares of stock and their
potential sale into any trading market in the Company's common stock may have a
dilutive and depressive effect on such trading market.
While the actual terms of a transaction to which the Company may be a party
cannot be predicted, we expect that the parties to the business combination will
want to avoid the creation of a taxable event and structure the acquisition in a
so called "tax free" reorganization under Sections 368(a)(1) or 351 of the
Internal Revenue Code of 1986, as amended. In order to obtain tax-free
treatment, it may be necessary for the owners of the acquired business to own
80% or more of the voting stock of the surviving entity. In this event, the
shareholders of the Company, including past and current investors, would retain
less than 20% of the issued and outstanding shares of the surviving entity,
which could result in significant dilution in the equity of such shareholders.
However, treatment as a tax free reorganization will not be a condition of any
future business combination and if it is not the case, the Company will not
obtain an opinion of counsel that the reorganization will be tax free.
13
<PAGE> 14
The Company will not have sufficient funds (unless it is able to raise funds in
a private placement) to undertake any significant development, marketing and
manufacturing of any products which it may acquire. The Company does not intend
to raise any funds, via private placement or otherwise, prior to the
effectiveness of a merger or acquisition. Upon the merger or acquisition, the
Company intends to obtain funds in one or more private placements to finance the
operation of the acquired business. Persons purchasing securities in these
placements and other shareholders may not have the opportunity to participate in
the decision relating to any acquisition. The Company's proposed business is
sometimes referred to as a blank check because any investors will entrust their
investment to the Company's management before they have a chance to analyze any
ultimate use to which their money may be put. Accordingly, the Company would
probably be required to give up a substantial portion of its interest in any
acquired product. We cannot assure you that the Company will be able either to
obtain additional financing or interest third parties in providing funding for
the further development, marketing and manufacturing of any products acquired.
We believe that the investigation of specific business opportunities and the
negotiation, drafting and execution of relevant agreements, disclosure documents
and other instruments will require substantial time, attention and costs for
accountants, attorneys and others. If the Company and/or the target business
decide not to participate in a specific business opportunity, the costs incurred
in the related investigation would not be recoverable. In addition, following
the merger the target company will incur additional expenses of complying with
the annual and periodic reporting requirements included in the Securities
Exchange Act of 1934. These will include legal, accounting, printing, filing and
related costs.
ITEM 3. DESCRIPTION OF PROPERTY.
The Company has a working agreement with one of its shareholders for use of
office space, telephones and secretarial services supplied free of charge. The
Company has no property.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT.
The following table presents certain information regarding beneficial ownership
of the Company's common stock as of May 1, 2000, by Mr. Hodges who is: (i) each
person known by the Company to be the beneficial owner of more than 5% of the
outstanding shares of common stock, (ii) each director and executive officer of
the Company, and (iii) all directors and executive officers as a group. Unless
otherwise indicated, each person in the table has sole voting and investment
power as to the shares shown.
<TABLE>
<CAPTION>
Name and Address Amount of
Title of Class of Beneficial Owner Beneficial Owner Percent of Class
-------------- ------------------- ---------------- ----------------
<S> <C> <C> <C>
Common Daniel L. Hodges 800,000 shares 80%
President and
Director
2102 N. Donner Avenue
Tucson, AZ 85749
</TABLE>
14
<PAGE> 15
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS.
A member of the Board of Directors of the Company serves until the next annual
meeting of shareholders, or until the member's successor has been elected. An
officer serves at the pleasure of the Board of Directors.
Currently, there is only one executive officer, key employee and director of the
Company:
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Daniel L. Hodges 34 President/Secretary/Director
</TABLE>
DANIEL L. HODGES. Daniel L. Hodges has been the sole Director, President, Chief
Financial Officer and Secretary of the Company since shortly after its
formation. Mr. Hodges has been president and director of Solomon Consulting
Corp. which specializes in corporate and securities consulting since 1995. He
has owned and operated an industrial manufacturing company, "APRI, Inc." since
1998. APRI, Inc. (which stands for Architectural PRoducts Incorporated) is a
company in the business of manufacturing concrete precast products such as
pillars, balastrade assemblies, wainscot, benches, etc. APRI ceased operations
in 1999 and is in the process of selling the casting and molding assets for the
sum of $150,000 to a third party named Cornerstone Precast, LLC. Mr. Hodges has
no affiliation with Cornerstone Precast, LLC. APRI, Inc. had gross revenues of
$383,000 in 1998 and estimated gross revenues of $140,000 in 1999. APRI, Inc.
leased premises in Tucson, Arizona of 8,000 square feet of industrial warehouse
space for its operations. This lease terminated in 1999. APRI never had more
than eight employees at any one time. Mr. Hodges is currently on the board of
directors of two charitable organizations as well as a number of blank check
companies, as we indicate on the chart below. Mr. Hodges received his B.S. from
Thomas A. Edison State College in Trenton, New Jersey. He is also a graduate of
the U.S. Air Force Undergraduate Pilot Training program and is currently the
rank of Captain as an officer in the Air National Guard.
The following chart summarizes certain information concerning the blank check
companies with which Mr. Hodges is or has been a director and which have filed
or intend to file a registration statement with the SEC, as of May 1, 2000. The
term "n/a" indicates that the company referenced has not entered into an
agreement for a business combination or merger.
<TABLE>
<CAPTION>
COMPANY NAME INC. STATE FORM10SB FILE DATE SEC FILE NO. MERGER INFO-IF APPLIC.
<S> <C> <C> <C> <C>
A Better Way Financial Corporation Wyoming 01/24/2000 0-29061 n/a
Amazing Investments, Inc. Wyoming 12/23/1999 0-28533 n/a
American Frontiers Marketing Company Wyoming 01/26/2000 0-29131 n/a
Arcadia Investments, Inc. Wyoming 12/17/1999 0-28535 n/a
Blackjack Financial, Inc. Wyoming 12/17/1999 0-28531 n/a
Boulder Creek Financial, Inc. Wyoming 12/23/1999 0-28623 n/a
Business to Business, Inc. Wyoming 12/17/1999 0-28533 n/a
</TABLE>
15
<PAGE> 16
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Caprock Canyon Investments, Inc Wyoming 12/27/1999 0-28647 n/a
Cedar Grove Marketing, Inc. Wyoming 12/22/2000 0-28615 n/a
Cherokee Investments, Inc. Wyoming 01/05/2000 0-28777 n/a
Coyote Canyon Corporation Wyoming 01/26/2000 0-29133 n/a
Easy Living Investments, Inc. Wyoming 01/26/2000 0-29135 n/a
Equality Investments, Inc. Wyoming 01/26/2000 0-29137 n/a
Essential Solutions, Inc. Wyoming 01/26/2000 0-29139 n/a
Fantastic Financial Corporation Wyoming 01/24/2000 0-29063 n/a
Feather Valley Financial, Inc. Wyoming 12/27/1999 0-28649 n/a
Freedom Financial Corporation Wyoming 12/27/1999 0-28651 n/a
Granite Cliffs Incorporated Wyoming 12/27/1999 0-28653 n/a
Harvest Valley Ventures, Inc. Wyoming 12/22/1999 0-28617 n/a
Magical Marketing, Inc. Wyoming 12/22/1999 0-28611 n/a
Monumental Marketing, Inc. Wyoming 01/05/2000 0-28769 n/a
Neighborhood Investments,Ltd. Wyoming 12/27/1999 0-28655 n/a
Preferred Investments, Inc. Wyoming 01/26/2000 0-29141 n/a
Private Access, Inc. Wyoming 01/26/2000 0-29143 n/a
Red Butte Financial, Inc. Wyoming 01/26/2000 0-29151 n/a
Spring Valley Management Corporation Wyoming 01/26/2000 0-29145 n/a
Stone Field Management Company Wyoming 01/26/2000 0-29147 n/a
Stonewall Financial, Ltd. Wyoming 12/22/1999 0-28613 n/a
Sweetwater Investing, Inc. Wyoming 01/04/2000 0-28751 n/a
Unimann, Inc. Wyoming 12/23/1999 0-28625 n/a
Valuable Ventures, Inc. Wyoming 12/27/1999 0-28673 n/a
Walnut Valley Ventures, Inc. Wyoming 01/26/2000 0-29153 n/a
Western Financial Corporation Wyoming 01/26/2000 0-29149 n/a
White Horse Resources, Inc. Wyoming 01/24/2000 0-29065 n/a
White Oak Corporation Wyoming 12/27/1999 0-28671 n/a
Achievement Investments Nevada 02/16/2000 0-29535 n/a
American Machine, Inc. Nevada 02/11/2000 0-29465 n/a
Buccaneer Marketing & Investments Nevada 02/11/2000 0-29467 n/a
Conservative West, Inc. Nevada 02/11/2000 0-29469 n/a
Deerwood, Inc. Nevada 02/11/2000 0-29471 n/a
Essential Laser Concepts Ltd. Nevada 02/16/2000 0-29533 n/a
Everyday Assembly Productions, Inc. Nevada 02/16/2000 0-29537 n/a
Forgotten Investments Company, Inc. Nevada 02/16/2000 0-29539 n/a
Green Clover Luck Corporation Nevada 02/16/2000 0-29541 n/a
Green Oaks Concepts, Ltd. Nevada 02/16/2000 0-29543 n/a
In Full Affect, Inc. Nevada 02/16/2000 0-29545 n/a
K.B. Far Incorporation Nevada 02/16/2000 0-29547 n/a
Knight Investment Ltd. Nevada 02/16/2000 0-29549 n/a
Market Integrity, Inc. Nevada 02/16/2000 0-29569 n/a
Nascent Technology, Inc. Nevada 02/16/2000 0-29551 n/a
Obligation Futures, Inc. Nevada 02/16/2000 0-29553 n/a
Par 3 Services, Inc. Nevada 02/16/2000 0-29555 n/a
Passover Management International, Inc. Nevada 02/16/2000 0-29571 n/a
Profits Emporium, Inc. Nevada 02/16/2000 0-29557 n/a
Ring of Fire Marketing, Ltd. Nevada 02/16/2000 0-29559 n/a
Seminar Strategies & Marketing, Inc. Nevada 02/16/2000 0-29561 n/a
</TABLE>
16
<PAGE> 17
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Silver Rose Development, Inc. Nevada 02/23/2000 0-29659 n/a
Social Engagements, Inc. Nevada 02/16/2000 0-29563 n/a
Superior Global Services, Inc. Nevada n/a n/a n/a
Triumphant Endeavors, Inc. Nevada 02/22/2000 0-29629 n/a
Alph-Net Consulting Group, Inc. Nevada n/a n/a n/a
Ambercom Incorporated Nevada n/a n/a n/a
Arthur Morris, Inc. Nevada n/a n/a n/a
Big Surf, Inc Nevada 01/12/2000 0-28857 n/a
Casterbridge Management, Inc. Nevada 01/26/2000 0-29157 n/a
Cerritos Holdings Nevada 10/20/1999 0-27733 See details below (1)
Cirrus Development Corp. Nevada 01/14/2000 0-28899 n/a
Clearwater Communications, Corp. Nevada 02/02/2000 0-29289 n/a
Flozone Marketing Co., Inc, Nevada n/a n/a n/a
G.E. Pension Capital Management Corp Nevada n/a n/a n/a
GENETI Corp. Nevada 01/14/2000 0-28901 n/a
Glass Dolphin, Inc. Nevada 01/12/2000 0-28851 n/a
H&L Investments Nevada 10/20/1999 0-27735 See details below (2)
HJS & BDS, Inc. Nevada n/a n/a n/a
Interlock Services Nevada 11/08/1999 0-27983 See details below (3)
International Lottery & Gaming, Inc. Nevada 01/25/2000 0-29119 n/a
K&L Electronics Photo and Supply, Co. Nevada n/a n/a n/a
Klamath Falls Corp. Nevada n/a n/a n/a
Laredo Investments, Inc. Nevada 11/05/1999 0-27959 See details below (4)
M.H. Trucking, Inc. Nevada n/a n/a n/a
Models, Inc. Nevada 01/12/2000 0-28855 n/a
Morenci Corp. Nevada 10/20/1999 0-27737 See details below (5)
Netsite Media, Inc. Nevada n/a n/a n/a
Nova Masonry, Inc. Nevada n/a n/a n/a
Pacific Administrative Services, Inc. Nevada 01/12/2000 0-28849 n/a
Peppercorn Industrial Corporation Nevada 01/26/2000 0-29155 n/a
Phantom Consulting Corp. Nevada 01/26/2000 0-29159 n/a
Providence Holdings, Inc. Nevada n/a n/a n/a
PSM Corp. Nevada 10/20/1999 0-27739 See details below (6)
RBO Holdings Inc. Nevada 01/12/2000 0-28859 n/a
RK Johnson Ltd. Nevada 01/12/2000 0-28853 n/a
Rome in a Day, Inc. Nevada n/a n/a n/a
Solco International, Inc. Nevada 12/02/1999 0-28337 n/a
Tridex Investing Inc. Nevada 01/14/2000 0-28905 n/a
Troiler USA, Inc. Nevada 01/25/2000 0-29117 n/a
Two Sisters Enterprises, Inc. Nevada n/a n/a n/a
Visionary Media, Inc. Nevada n/a n/a n/a
Zenger, Inc. Nevada n/a n/a n/a
Horse Tooth Ventures, Inc. Wyoming n/a n/a n/a
Owl Canyon Ventures, Inc. Wyoming n/a n/a n/a
Table Mountain Resources, Inc. Wyoming n/a n/a n/a
Snake River Resourses, Inc. Wyoming n/a n/a n/a
High peak Ventures, inc. Wyoming n/a n/a n/a
Grassy Pond Properties, Inc. Wyoming n/a n/a n/a
Expert Investing, Inc. Wyoming n/a n/a n/a
</TABLE>
17
<PAGE> 18
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Chinook Winds, Inc. Wyoming n/a n/a n/a
Diamond Opportunities, Inc. Wyoming n/a n/a n/a
Crystal River Resources Wyoming n/a n/a n/a
Platte Holding Company Wyoming n/a n/a n/a
Sharp Spur Financial Corporation Wyoming n/a n/a n/a
Blue Mountains, Inc. Wyoming n/a n/a n/a
Shell Canyon Ventures Wyoming n/a n/a n/a
Sunnyside Investments, Inc. Wyoming n/a n/a n/a
Crow Creek Financial Services, Inc. Wyoming n/a n/a n/a
Ponderosa Properties, Inc. Wyoming n/a n/a n/a
Action Investments, Inc. Wyoming n/a n/a n/a
Medicine Bow Investments, Inc. Wyoming n/a n/a n/a
Lonesome Pine Investments, Inc. Wyoming n/a n/a n/a
Tribeworks, Inc. (fka Pan World Corp) Nevada Non-Reporting n/a See details below (7)
Kestrel Equity Corporation Arizona 12/17/1999 0-28553 See details below (8)
Avaterra.com, Inc. (fka Pockets Hldng) Arizona Non-Reporting n/a See details below (9)
Netmeasure Techn. (fka Powertech, Inc) Nevada 10/15/1999 0-27675 See details below (10)
Landstar, Inc. Nevada 01/04/2000 1-15597 See details below (11)
Hyaton Corporation Nevada 10/28/1999 0-27853 See details below (12)
Phileo Management Company Nevada Non-Reporting n/a See details below (13)
ImuMed Int'l (fka Viper Resources, Inc. Nevada Non-Reporting n/a See details below (14)
Upland Properties, Inc. Nevada Non-Reporting n/a See details below (15)
Solomon Alliance Group, Inc. Nevada 03/16/2000 0-29973 See details below (16)
Pioneer Spirit 2000, Inc. Nevada Non-Reporting n/a See details below (17)
Merendon International, Inc. Nevada Non-Reporting n/a See details below (18)
</TABLE>
(1) Cerritos Holdings, Inc. Mr. Hodges relinquished control of the company
through a resignation of his positions and sale of the control block of issued
and outstanding stock held by him (800,000 shares) back to the treasury of the
company for cancellation. He received an amount of $150,000 in cash for the
combination of stock sold and fees owed to him by the company. Subsequent to Mr.
Hodges resignation, the company began operations in the entertainment industry
in Vancouver, B.C. to provide studio, production and set services for TV and
major motion pictures. Mr. Hodges has no affiliation or ties to the current
company, nor has he, since the date of his resignation on January 8, 2000. The
company trades under the symbol CERHE.
(2) H&L Investments, Inc. Mr. Hodges relinquished control of the company through
a resignation of his positions and sale of the control block of issued and
outstanding stock held by him (800,000 shares) back to the new board chairman
for cancellation. He received an amount of $100,000 in cash for the combination
of stock sold and fees owed to him by the company. Subsequent to Mr. Hodges
resignation, the company began operations in the Internet industry by merging
with Asia4Sale.com, Inc. and changed its name. Mr. Hodges has no affiliation or
ties to the current company, nor has he, since the date of his resignation on
December 20, 1999. The company now trades under the symbol AFSI.
(3) Interlock Services, Inc. Mr. Hodges relinquished control of the company
through a resignation of his positions and sale of the control block of issued
and outstanding stock held by
18
<PAGE> 19
him (800,000 shares) back to the treasury of the company for cancellation. He
received an amount of $110,000 in cash for the combination of stock sold and
fees owed to him by the company. Subsequent to Mr. Hodges resignation, the
company began operations in the Internet industry by merging with
2DoBusiness.com, Inc. and changed its name. Mr. Hodges has no affiliation or
ties to the current company, nor has he, since the date of his resignation on
December 21, 1999. The company now trades under the symbol DOBZE.
(4) Laredo Investments, Inc. Mr. Hodges relinquished control of the company
through a resignation of his positions and sale of the control block of issued
and outstanding stock held by him (800,000 shares) back to the treasury of the
company for cancellation. He received an amount of $100,000 in cash for the
combination of stock sold and fees owed to him by the company. Subsequent to Mr.
Hodges' resignation, the company announced on March 3, 2000 that it intends to
acquire 100% of the stock of GFR Nutritionals, Ltd. which is engaged in the
manufacture and sale of health industry products. Mr. Hodges has no affiliation
or ties to the current company, nor has he, since the date of his resignation on
January 5, 2000. The company trades under the symbol LRDI.
(5) Morenci Corp. Mr. Hodges relinquished control of the company through a
resignation of his positions and sale of the control block of issued and
outstanding stock held by him (800,000 shares) back to the treasury of the
company for cancellation. He received an amount of $150,000 in cash for the
combination of stock sold and fees owed to him by the company. Subsequent to Mr.
Hodges resignation, the company began operations in the Internet industry by
merging with esportsbike.com, Inc. Mr. Hodges has no affiliation or ties to the
current company, nor has he, since the date of his resignation on January 8,
2000. The company trades under the symbol ESPB.
(6) PSM Corp. Mr. Hodges relinquished control of the company through a
resignation of his positions and sale of the control block of issued and
outstanding stock held by him (800,000 shares) back to the treasury of the
company for cancellation. He received an amount of $100,000 in cash for the
combination of stock sold and fees owed to him by the company. Subsequent to Mr.
Hodges resignation, the company began operations in the service industry by
merging with Mentor on Call, Inc. Mr. Hodges has no affiliation or ties to the
current company, nor has he, since the date of his resignation on December 21,
1999. The company trades under the symbol MNOC.
(7) Tribeworks, Inc. (fka Pan World Corp.) Mr. Hodges relinquished control of
the company through a resignation of his positions and sale of the control block
of issued and outstanding stock held by him (950,000 shares) back to the
treasury of the company for cancellation. He received an amount of $60,000 in
cash for the combination of stock sold and fees owed to him by the company.
Subsequent to Mr. Hodges resignation, the company began operations in the
entertainment industry by merging with Tribeworks, Inc. and changed its name.
Mr. Hodges has no affiliation or ties to the current company, nor has he, since
the date of his resignation March 23, 1999. The company trades under the symbol
TRWX.
(8) Kestrel Equity Corp. Mr. Hodges relinquished control of the company through
a resignation of his positions and sale of the control block of issued and
outstanding stock held by him
19
<PAGE> 20
(950,000 shares) back to the treasury of the company for cancellation. He
received an amount of $75,000 in cash for the combination of the stock sold and
fees owed to him by the company. Subsequent to Mr. Hodges resignation, the
company began operations in the entertainment industry by merging with
StereoVision Entertainment, Inc. and changed its name. Mr. Hodges has no
affiliation or ties to the current company, nor has he, since the date of his
resignation on September 24, 1999. The company trades under the symbol SVED.
(9) Avaterra.com, Inc. (fka Pockets Holding Corp.) Mr. Hodges relinquished
control of the company when it was known as Pockets Holding Corp., through a
resignation of his positions and sale of the control block of issued and
outstanding stock held by him (950,000 shares) back to the treasury of the
company for cancellation. He received an amount of $50,000 in cash for the
combination of the stock sold and fees owed to him by the company. Subsequent to
Mr. Hodges resignation, the company began operations in the entertainment
industry by merging with Avaterra.com, Inc. and changed its name. Mr. Hodges has
no affiliation or ties to the current company, nor has he, since the date of his
resignation on February 15, 1999. The company trades under the symbol AVAR.
(10) NetMeasure Technology, Inc. (fka Powertech, Inc. NV) Mr. Hodges resigned
his positions with the company on December 9, 1998. Concurrent with his
resignation, Mr. Hodges transferred his stock to the new management of the
company. He received no compensation for the stock or for the services owed to
him by the company. Subsequent to Mr. Hodges resignation, the company began
operations in the Internet security industry by merging with NetSentry, Inc. Mr.
Hodges has no affiliation or ties to the current company, nor has he, since the
date of his resignation. Mr. Hodges is unaware of the symbol now assigned to the
company.
(11) Landstar, Inc. Mr. Hodges relinquished control of the company through a
resignation of his positions and sale of the control block of issued and
outstanding stock held by him (500,000 shares) back to the treasury of the
company for cancellation. He received an amount of $80,000 in cash for the
combination of the stock sold and fees owed to him by the company. Mr. Hodges
has no affiliation or ties to the current company, nor has he, since the date of
his resignation on November 15, 1998. The company trades under the symbol LDSR.
(12) Hyaton Organics, Inc. (fka Hyaton Company, Inc.) Mr. Hodges relinquished
control of the company through a resignation of his positions and sale of the
control block of issued and outstanding stock held by him (500,000 shares) back
to the treasury of the company for cancellation. He received an amount of
$60,000 in cash for the combination of the stock sold and fees owed to him by
the company. Mr. Hodges has no affiliation or ties to the current company, nor
has he, since the date of his resignation on October 27, 1998. The company
trades under the symbol HYTN.
(13) Phileo Management Company, Inc. Mr. Hodges relinquished control of the
company through a resignation of his positions and sale of the control block of
issued and outstanding stock held by him (500,000 shares) back to the treasury
of the company for cancellation. He received an amount of $60,000 in cash for
the combination of the stock sold and fees owed to him by the company. Mr.
Hodges has no affiliation or ties to the current company, nor has he,
20
<PAGE> 21
since the date of his resignation on January 18, 1999. The company trades under
the symbol HYTN.
(14) ImuMed International, Inc. (fka Viper Resources, Inc.) Mr. Hodges
relinquished control of the company through a resignation of his positions and
sale of the stock held by him (500,000 shares) back to the treasury of the
company for cancellation. He received an amount of $75,000 in cash for the
combination of the stock sold and fees owed to him by the company. Mr. Hodges
has no affiliation or ties to the current company, nor has he, since the date of
his resignation on December 15, 1998. The company trades under the symbol IMEDE.
(15) Upland Properties, Inc. Mr. Hodges resigned his positions with the company
and sold the stock held by him (250,000 shares) back to the treasury of the
company for cancellation. He received an amount of $50,000 in cash for the
combination of the stock sold and fees owed to him by the company. Mr. Hodges
has no affiliation or ties to the current company, nor has he, since the date of
his resignation on September 5, 1998.
(16) Solomon Alliance Group, Inc. Mr. Hodges relinquished control of the company
through a resignation of his positions and sale of the stock held by him
(500,000 shares) back to the treasury of the company for cancellation. He
received an amount of $85,000 in cash for the combination of the stock sold and
fees owed to him by the company. Mr. Hodges has no affiliation or ties to the
current company, nor has he, since the date of his resignation on November 12,
1998. The company trades under the symbol SAGE.
(17) Pioneer Spirit 2000, Inc. Mr. Hodges relinquished control of the company
through a resignation of his positions on Feb. 20, 2000 and the sale of the
stock held by him (950,000 shares) back to the treasury of the company for
cancellation. He received an amount of $110,000 in cash for the stock sold and
fees owed to him by the company. Mr. Hodges has no affiliation or ties to the
current company, nor has he, since the date of his resignation. The company is
cleared to trade under the symbol PSPR.
(18) Merendon International, Inc. Mr. Hodges relinquished control of the company
through a resignation of his positions and sale of the stock held by him
(1,800,000 shares) back to the treasury of the company for cancellation. He
received an amount of $100,000 in cash for the stock sold and fees owed to him
by the company. Mr. Hodges has no affiliation or ties to the current company,
nor has he, since the date of his resignation on January 25, 2000. The company
is cleared to trade under the symbol MERI.
ITEM 6. EXECUTIVE COMPENSATION.
No employment compensation is paid or anticipated to be paid by the Company. The
Company has no understandings or agreements, preliminary or otherwise, in regard
to executive compensation. Its sole director and officer, Mr. Hodges, does not
receive any compensation for his duties. On November 4, 1997, the Company issued
800 shares (800,000 shares after giving effect to a forward stock-split) of
common stock as compensation to Mr. Hodges in connection with services rendered
and fees paid by him at the time of the formation of the Company. Mr.
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<PAGE> 22
Hodges has not received any other compensation for his services rendered to the
Company and is not accruing compensation. As of the date of this prospectus, the
Company has no funds available to pay officers and directors.
The Company has no employment agreements with any persons. No retirement,
pension, profit sharing, stock option or insurance programs or other similar
programs have been adopted by the Company for the benefit of any employees.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
On November 4, 1997, the Company issued a total of 1,000 shares of its common
stock in the following manner. In consideration of Mr. Hodges contributing $500
toward the organizational expenses of the Company and for $300 in services
rendered, the Company issued Mr. Hodges 800 shares of its common stock. On
October 20, 1999, the outstanding shares were forward split 1,000 to 1 and the
par value was changed to $.001, resulting in a total of 1,000,000 shares
outstanding, 800,000 of which are owned by Mr. Hodges.
Under Rule 405 promulgated under the Securities Act of 1933, Mr. Hodges may be
deemed to be a promoter of the Company. No other persons are known to management
that would be deemed to be promoters.
ITEM 8. DESCRIPTION OF SECURITIES.
Each shareholder of common stock, either in person or by proxy, may cast one
vote per share of common stock held on all matters to be voted on. The presence,
in person or by proxy, of the holders of a majority of the total number of
shares entitled to vote constitutes a quorum for the transaction of business.
Assuming that a quorum is present, the affirmative vote of a majority of the
shares of the Company present in person or represented by proxy is required. The
Company's articles of incorporation do not provide for cumulative voting or
preemptive rights.
There are no outstanding options or warrants of any kind for the Company's
common stock.
The transfer agent, warrant agent and registrar for the Common Stock is Holladay
Stock Transfer, 2939 67th Place, Scottsdale, AZ 85251.
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<PAGE> 23
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S
COMMON EQUITY AND OTHER STOCKHOLDER MATTERS.
The Company's common stock is not currently traded. There are no plans,
proposals, arrangements or understandings with any person concerning the
development of a trading market in the Company's securities.
No dividends have been declared on the Company's stock. The Company does not
foresee any dividends being declared in the near future.
As of May 1, 2000, the Company had the following 26 stockholders of record:
<TABLE>
<CAPTION>
Method of
Original
Date Issuance
of (i.e. Shares
Name of Original purchase, Beneficially
Security Holder Issue gift, etc.) Owned (1)
--------------- ----- ----------- ---------
<S> <C> <C> <C>
Daniel L. Hodges (2) 11/4/97 For services 800,000 (4)
5505 N. Indian Trail rendered (3)
Tucson, AZ 85759
David Adams 11/4/97 Gift (5) 8,000
6556 E. Calle Herculo
Tucson, AZ 85712
Frank Anjakos 11/4/97 Gift (5) 8,000
1971 N. Lindenwood Dr.
Tucson, AZ 85712
Gerald Bowlin 11/4/97 Gift (5) 8,000
1 E. River Road, #720
Tucson, AZ 85704
Robert C. Daly 11/4/97 Gift (5) 8,000
6250 Kelly Lynn Court
Waxhaw, NC 28173
Brain Delfs 11/4/97 Gift (5) 8,000
10130 E. Citrus Street
Tucson, AZ 85712
</TABLE>
23
<PAGE> 24
<TABLE>
<S> <C> <C> <C>
James Delfs 11/4/97 Gift (5) 8,000
3730 N. Tucson Blvd.
Tucson, AZ 85716
Eric Evans 11/4/97 Gift (5) 8,000
305 N. Hidalgo
Alabama, CA 91801
Andrew Gerrish 11/4/97 Gift (5) 8,000
2231 N. Norris
Tucson, AZ 85719
Audra Guthery 11/4/97 Gift (5) 8,000
4810 E. Seneca
Tucson, AZ 85712
David H. Hack 11/4/97 Gift (5) 8,000
232 W. Smoot Drive
Tucson, AZ 85705
Matthew S. Hodges 11/4/97 Gift (5) 8,000
1529 N. Desmond
Tucson, AZ 85712
Scott Krause 11/4/97 Gift (5) 8,000
9160 E. Walnut Tree
Drive
Tucson, AZ 85749
Michael McKendrick 11/4/97 Gift (5) 8,000
3015 N. Wentworth Road
Tucson, AZ 85749
John R. Ogden 11/4/97 Gift (5) 8,000
5765 N. Paseo San Ardo
Tucson, AZ 85747
Ron Olson 11/4/97 Gift (5) 8,000
9969 E. Paseo San Ardo
Tucson, AZ 85747
Mark Polifka 11/4/97 Gift (5) 8,000
1132 Mohawk
Topanga, CA 90290
</TABLE>
24
<PAGE> 25
<TABLE>
<S> <C> <C> <C>
Michael Rhyner 11/4/97 Gift (5) 8,000
9737 E. Mount Pleasant
Tucson, AZ 89749
Monica Romero 11/4/97 Gift (5) 8,000
2528 W. Criswell Court
Tucson, AZ 85744
Melissa Saucedo 11/4/97 Gift (5) 8,000
7019 W. Avondale
Tucson, AZ 85743
Howard Smith 11/4/97 Gift (5) 8,000
4050 N. Hiddencove
Place
Tucson, AZ 85749
John Sylvester 11/4/97 Gift (5) 8,000
10222 E. Sylvester Road
Hereford, AZ 85615
Roger Tamietti 11/4/97 Gift (5) 8,000
HC 70 Box 4254
Sahuarita, AZ 85629
Raymond Willey 11/4/97 Gift (5) 8,000
1192 Joseph Ct.
Ripton, CA 95366
Jennifer L. Worden 11/4/97 Gift (5) 8,000
9055 E. Catlina Highway
No. 5206
Tucson, AZ 85749
Roger Wright 11/4/97 Gift (5) 8,000
5294 W. Peridot Street
Tucson, AZ 85741
</TABLE>
(1) On October 20, 1999, the outstanding shares of the Company's common stock
were forward split 1,000 to 1, resulting in a total of 1,000,000 shares
outstanding.
(2) Officer and director of the Company.
(3) These shares were issued in reliance on Section 4(2) of the Securities
Act. In consideration of Mr. Hodges contributing $500 toward the
organizational expenses of the Company, and for $300 in services
rendered, on November 4, 1997, the Company issued Mr. Hodges 800 shares
of the Company's common stock.
(4) Restricted shares.
25
<PAGE> 26
(5) These shares were issued to individuals as gifts by Mr. Hodges in
reliance on Section 4(2) of the Securities Act. No consideration (cash or
otherwise) was received in exchange for the share issuances. The shares
were gifted to individuals whom Mr. Hodges knew either through familial
relationships or business associations. Mr. Hodges also selected
individuals who could provide some potential for introducing the Company
to potential merger or acquisition candidates or business opportunities
as well as individuals who were willing to provide the Company with
clerical services for no renumeration. There are no known relationships
between any of the shareholders, or between Mr. Hodges as the sole
officer and director and any shareholders, except that Matthew Hodges is
the adult nephew of Mr. Hodges, Jennifer Warden is married to Mr. Hodges,
David H. Hack is married to Monica Romero and Brian Delfs and James Delfs
are brothers.
--------------------------------------------------------------------------------
State by State Tabulation of Selling Shareholders
--------------------------------------------------------------------------------
Arizona 968,000
--------------------------------------------------------------------------------
California 24,000
--------------------------------------------------------------------------------
North Carolina 8,000
--------------------------------------------------------------------------------
ITEM 2. LEGAL PROCEEDINGS.
Not Applicable.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING.
Not Applicable.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
There have been no recent sales of the Company's securities. As noted above, in
connection with organizing the Company, on November 4, 1997, persons consisting
of its officers, directors, and other individuals were issued a total of 1,000
unregistered shares of Common Stock at a value of $.001 per share. The Company
relied upon Section 4(2) of the Securities Act. On October 20, 1999, those
outstanding shares were forward split 1,000 to 1, resulting in a total of
1,000,000 shares outstanding.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Under the Nevada Business Associations Act Title 7, Chapter 78, Section 037, a
corporation's articles of incorporation may include a provision eliminating or
limiting the personal liability of a director or officer to the corporation or
its stockholders for damages for breach of fiduciary
26
<PAGE> 27
duty as a director or officer. Such a provision may not, however, eliminate or
limit the liability of a director or officer for (a) acts or omissions which
involve intentional misconduct, fraud or a knowing violation of law or (b) the
payment of unlawful distributions to shareholders in violation of section 78.300
of the Nevada Revised Statutes.
The Company's Articles of Incorporation mirror these statutory requirements.
Article 12 provides that no director or officer of the Company shall be
personally liable to the Company or any of its stockholders for damages for
breach of fiduciary duty as a director or officer involving any act or omission
of any such director or officer. This provision, however, shall not eliminate or
limit the liability of a director or officer for (a) acts or omissions which
involve intentional misconduct, fraud or a knowing violation of law or (b) the
payment of dividends in violation of section 78.300 of the Nevada Revised
Statutes. Any repeal or modification of this Article by the Company's
shareholders shall be prospective only.
The Company's By-Laws provide that the Company shall indemnify, to the fullest
extent not prohibited by the Nevada General Corporation Law, its present and
former directors and officers, as well as any person who is serving, or has
served, at the request of the Company as a director or officer of another
corporation, partnership, joint venture, trust or other enterprise. Prior to a
final disposition, the Company shall advance to any director or officer who has
been named, or has been threatened to be named, as a party to any threatened,
pending, or completed action, suit, or proceeding due to his present or former
status as a director or officer of the Company all expenses actually and
necessarily incurred, provided that the Company is in receipt of an undertaking
by or on behalf of such person to repay said amounts if it should be ultimately
determined that such person is not entitled to indemnification under these
By-Laws or otherwise. However, no advance shall be made by the Company to an
officer, unless he or she is or was a director, in any action, suit or
proceeding if it is reasonably and promptly determined by (a) the Board of
Directors by a majority vote of a quorum consisting of directors who are not
parties to the action, suit or proceeding or (b) an independent legal counsel in
a written opinion, at the direction of a quorum of disinterested directors, that
such person acted in bad faith or in a manner that such person did not believe
to be in the best interests of the Company. The Company shall not be required to
indemnify any director or officer against any proceeding initiated by such
person unless (a) such indemnification is expressly required by law, (b) the
proceeding was authorized by the Board of Directors of the Company, (c) such
indemnification is provided by the Company in its sole discretion or (d) such
indemnification is required to be made under the By-Laws.
Rights to indemnification under these By-Laws shall be deemed to be contractual
rights that may be modified through individual contracts with the Company's
directors and officers. No such contracts have been made as of the date of
filing of this Form 10-SB. These rights shall not be deemed exclusive of any
other rights which those indemnified may have or later acquire under any
statute, provision of the Articles of Incorporation, provision of the By-Laws,
agreement, vote of stockholders, or otherwise. These rights shall continue to
one who has ceased to be a director or officer and shall inure to the benefit of
the heirs, executors, and administrators of such a person.
27
<PAGE> 28
PART F/S
FINANCIAL STATEMENTS
The consolidated financial statements of the Company
required to be included in Part F/S are set forth below.
<PAGE> 29
SEMINAR STRATEGIES & MARKETING, INC.
(A DEVELOPMENT STAGE COMPANY)
-:-
INDEPENDENT AUDITOR'S REPORT
DECEMBER 31, 1999 AND 1998
<PAGE> 30
CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Independent Auditor's Report.........................................................................F - 1
Balance Sheets
December 31, 1999 and 1998.........................................................................F - 2
Statements of Operations for the
Years Ended December 31, 1999 and 1998.............................................................F - 3
Statement of Stockholders' Equity
Since July 25, 1997 (inception) to December 31, 1999................................................F - 4
Statements of Cash Flows for the
Years Ended December 31, 1999 and 1998.............................................................F - 5
Notes to Financial Statements........................................................................F - 6
</TABLE>
<PAGE> 31
INDEPENDENT AUDITOR'S REPORT
Seminar Strategies & Marketing, Inc.
(A Development Stage Company)
We have audited the accompanying balance sheets of Seminar
Strategies & Marketing, Inc. (a development stage company) as of December 31,
1999 and 1998, and the related statements of operations, and cash flows for the
two years ended December 31, 1999 and the statement of stockholders' equity from
July 25, 1997 (inception) to December 31, 1999. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Seminar Strategies &
Marketing, Inc. (a development stage company) as of December 31, 1999 and 1998,
and the results of its operations and its cash flows for the two years ended
December 31, 1999 in conformity with generally accepted accounting principles.
Respectfully submitted
/s/ Robison, Hill & Co.
-----------------------------
Certified Public Accountants
Salt Lake City, Utah
January 4, 2000
F-1
<PAGE> 32
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
BALANCE SHEETS
<TABLE>
<CAPTION>
December 31,
---------------------------------------------------
1999 1998
------------------------ ------------------------
<S> <C> <C>
Assets: $ - $ -
======================== ========================
Liabilities - Accounts Payable $ - $200
------------------------ ------------------------
Stockholders' Equity:
Common Stock, Par value $.001
Authorized 100,000,000 shares,
Issued 1,000,000 shares at December 31,
1999 and 1998 1,000 1,000
Paid-In Capital 350 -
Retained Deficit (1,200) (1,200)
Deficit Accumulated During the
Development Stage (150) -
------------------------ ------------------------
Total Stockholders' Equity - (200)
------------------------ ------------------------
Total Liabilities and
Stockholders' Equity $ - $ -
======================== ========================
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-2
<PAGE> 33
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Cumulative
since
October
20,
1999
For the year ended inception
December 31, of
--------------------------------------------------- development
1999 1998 stage
------------------------ ------------------------ ------------------------
<S> <C> <C> <C>
Revenues: $ - $ - $ -
Expenses: 150 100 150
------------------------ ------------------------ ------------------------
Net Loss $(150) $(100) $(150)
------------------------ ------------------------ ------------------------
Basic & Diluted loss per share $ - $ -
======================== ========================
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-3
<PAGE> 34
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
SINCE JULY 25, 1997 (INCEPTION) TO DECEMBER 31, 1999
<TABLE>
<CAPTION>
Common Stock Paid-In
Shares Par Value Capital
------------------- ------------------ ----------------
<S> <C> <C> <C>
Balance at July 25, 1997 (inception) - - -
November 4, 1997 Issuance of Stock
for Services and payment
of Accounts Payable 1,000 1,000
Net Loss - - -
------------------- ------------------ ----------------
Balance at December 31, 1997
As Originally Reported 1,000 1,000 -
Retroactive adjustment for 1,000
to 1 stock split October 20, 1999 999,000 - -
------------------- ------------------ ----------------
Restated balance January 1, 1998 1,000,000 1,000 -
Net Loss - - -
------------------- ------------------ ----------------
Balance at December 31, 1,000,000 1,000 -
1998
Capital contributed by Shareholder - - 350
Net Loss - - -
------------------- ------------------ ----------------
Balance at December 31, 1999 1,000,000 $1,000 $350
=================== ================== ================
</TABLE>
<TABLE>
<CAPTION>
Deficit
Accumulated
Since
October
20,
1999
inception
of
Retained Development
Deficit Stage
----------------- -----------------------
<S> <C> <C>
Balance at July 25, 1997 (inception) - -
November 4, 1997 Issuance of Stock
for Services and payment
of Accounts Payable
Net Loss (1,100) -
----------------- -----------------------
Balance at December 31, 1997
As Originally Reported (1,100) -
Retroactive adjustment for 1,000
to 1 stock split October 20, 1999 - -
----------------- -----------------------
Restated balance January 1, 1998 (1,100) -
Net Loss (100) -
----------------- -----------------------
Balance at December 31, (1,200) -
1998
Capital contributed by Shareholder - -
Net Loss - (150)
----------------- -----------------------
Balance at December 31, 1999 $(1,200) $(150)
=======================
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-4
<PAGE> 35
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Cumulative
Since
October
20,
For the 1999
years ended inception
December 31, of
--------------------------------- Development
1999 1998 Stage
----------------- -------------- ----------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING
-------------------------
ACTIVITIES:
-----------
Net Loss $(150) $(100) $(150)
Increase (Decrease) in Accounts Payable (200) 100 (200)
----------------- -------------- ----------------------
Net Cash Used in operating activities (350) - (350)
----------------- -------------- ----------------------
CASH FLOWS FROM INVESTING
-------------------------
ACTIVITIES:
-----------
Net cash provided by investing activities - - -
----------------- -------------- ----------------------
CASH FLOWS FROM FINANCING
-------------------------
ACTIVITIES:
-----------
Capital contributed by 350 - 350
shareholder
----------------- -------------- ----------------------
Net Cash Provided by
Financing Activities 350 - 350
----------------- -------------- ----------------------
Net (Decrease) Increase in
Cash and Cash Equivalents - - -
Cash and Cash Equivalents
at Beginning of Period - - -
----------------- -------------- ----------------------
Cash and Cash Equivalents
at End of Period $ - $ - $ -
================= ============== ======================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
Interest $ - $ - $ -
Franchise and income taxes $300 _ $300
</TABLE>
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES: None
The accompanying notes are an integral part of these financial statements.
F-5
<PAGE> 36
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
This summary of accounting policies for Seminar Strategies &
Marketing, Inc. is presented to assist in understanding the Company's financial
statements. The accounting policies conform to generally accepted accounting
principles and have been consistently applied in the preparation of the
financial statements.
Organization and Basis of Presentation
The Company was incorporated under the laws of the State of Nevada
on July 25, 1997. The Company ceased all operating activities during the period
from July 25, 1997 to October 20, 1999 and was considered dormant. Since October
20, 1999, the Company is in the development stage, and has not commenced planned
principal operations.
Nature of Business
The Company has no products or services as of December 31, 1999. The
Company was organized as a vehicle to seek merger or acquisition candidates. The
Company intends to acquire interests in various business opportunities, which in
the opinion of management will provide a profit to the Company.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers
all highly liquid debt instruments purchased with a maturity of three months or
less to be cash equivalents to the extent the funds are not being held for
investment purposes.
Pervasiveness of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles required 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.
F-6
<PAGE> 37
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(Continued)
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (Continued)
Loss per Share
The reconciliations of the numerators and denominators of the basic
loss per share computations are as follows:
<TABLE>
<CAPTION>
Per-Share
Income Shares Amount
------ ------ ------
(Numerator) (Denominator)
<S> <C> <C> <C>
For the year ended December 31, 1999
------------------------------------
BASIC LOSS PER SHARE
Loss to common shareholders $ (150) 1,000,000 $ -
========== ========== =========
For the year ended December 31, 1998
------------------------------------
BASIC LOSS PER SHARE
Loss to common shareholders $ (100) 1,000,000 $ -
========== ========== =========
</TABLE>
The effect of outstanding common stock equivalents would be
anti-dilutive for December 31, 1999 and 1998 and are thus not considered.
NOTE 2 - INCOME TAXES
As of December 31, 1999, the Company had a net operating loss
carryforward for income tax reporting purposes of approximately $1,000 that may
be offset against future taxable income through 2011. Current tax laws limit the
amount of loss available to be offset against future taxable income when a
substantial change in ownership occurs. Therefore, the amount available to
offset future taxable income may be limited. No tax benefit has been reported in
the financial statements, because the Company believes there is a 50% or greater
chance the carryforwards will expire unused. Accordingly, the potential tax
benefits of the loss carryforwards are offset by a valuation allowance of the
same amount.
F-7
<PAGE> 38
SEMINAR STRATEGIES & MARKETING, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(Continued)
NOTE 3 - DEVELOPMENT STAGE COMPANY
The Company has not begun principal operations and as is common with
a development stage company, the Company has had recurring losses during its
development stage.
NOTE 4 - COMMITMENTS
As of December 31, 1999 all activities of the Company have been
conducted by corporate officers from either their homes or business offices.
Currently, there are no outstanding debts owed by the company for the use of
these facilities and there are no commitments for future use of the facilities.
NOTE 5 - STOCK SPLIT
On October 20, 1999 the Board of Directors authorized 1,000 to 1
stock split, changed the authorized number of shares to 100,000,000 shares and
the par value to $.001 for the Company's common stock. As a result of the split,
999,000 shares were issued. All references in the accompanying financial
statements to the number of common shares and per-share amounts for 1999 and
1998 have been restated to reflect the stock split.
F-8
<PAGE> 39
PART III
Item 1. Index to Exhibits.
Exhibit 1. Articles of Incorporation.
Exhibit 2. Amendment to Articles of Incorporation.
Exhibit 3.* Bylaws.
------
* Previously filed.
In accordance with Section 12 of the Securities Exchange Act of 1934, the
registrant caused this registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
SEMINAR STRATEGIES & MARKETING, INC.
(Registrant)
Date: June 1, 2000
By: /s/ Daniel Hodges
------------------------
President
1
