17
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Neckties2U, INC.
(Name of issuer in its charter)
<TABLE>
<S> <C> <C>
Nevada Applied For
(State or other (Primary Standard (I.R.S. Employer
jurisdiction Industrial Identification
of Classification Code No.) No.)
incorporation)
</TABLE>
____________________________
11777 San Vicente Blvd., Suite 702
Los Angeles, CA 90049
(310) 826-0676
(Address and telephone number of principal executive offices)
____________________________
Premier Corporate Services, Inc.
1000 N. Green Valley Pkwy., #440-195
Henderson, NV 89014
(702) 650-2050
(Name, address and telephone number of agent for service)
____________________________
Approximate date of proposed sale to the public: As soon as
reasonably practicable after the effective date of this
Registration Statement.
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis, pursuant to Rule 415
under the Securities Act of 1933 check the following box. : _
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please
check the fallowing box and list the Securities Act registration
statement number of the earlier effective registration statement
for the same offering. 9
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier
effective registration statement for the same offering.9 _
If this Form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list
the Securities Act registration statement number or the earlier
effective registration statement for the same offering. 9 _
If delivery of the prospectus is expected to be made pursuant to
Rule 434, check the following box. 9_
_________________________________
<TABLE>
<S> <C> <C> <C> <C>
Title of Amount to Proposed Proposed Amount of
Each Class be maximum Maximum Registratio
of registered offering Aggregate n
Securities price per Offering Fee
to be unit Price(3)
Registered
Common 2,500,000 $0.01 $25,000 $6.60
</TABLE>
Includes: (i) shares of common stock that have been issued or are
reserved for issuance on the exercise of common stock Purchase
Warrants issued in connection with the issuance of the
debentures; and (ii) shares of common stock that have been issued
to consultants of Neckties 2U, Inc.
(2) In the event of a stock split, stock dividend or similar
transaction involving the common stock, in order to prevent
dilution, the number of shares registered shall be automatically
increased to cover additional shares in an indeterminate amount
in accordance with Rule 416(a) under the Securities Act of 1933,
as amended.
(3) Estimated solely for purposes of calculating registration
fee pursuant to Rule 457 under the Securities Act of 1933, as
amended.
The registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date
until the registrant shall rile a further amendment which
specifically states that this registration statement shall
thereafter become effective in accordance with Section 8(a) of
the Securities At of 1933 or until the registration statement
shall become effective on such date as the Commission, acting
pursuant to said Section 8(2), may determine.
Neckties2U, Inc.
2,500,000 Shares of Common Stock
This prospectus relates to the sale of up to 2,500,000 shares of
common stock of Neckties2U, Inc. The shares may be offered by
the selling stockholders from time to time in regular brokerage
transactions, in transactions directly with market makers or in
certain privately negotiated transactions. For additional
information on the methods of sale, you should refer to the
section entitled A Plan of Distribution.
The securities offered hereby are speculative and involve a high
degree of risk and substantial dilution. Only investors who can
bear the risk of loss of their entire investment should invest.
See Risk Factors.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
TABLE OF CONTENTS
ITEM 3. SUMMARY INFORMATION AND RISK FACTORS 5
ITEM 4 USE OF PROCEEDS 7
ITEM 5. DETERMINATION OF OFFERING PRICE 7
ITEM 6. DILUTION 7
ITEM 7. SELLING SECURITY HOLDERS 8
ITEM 8. PLAN OF DISTRIBUTION 8
ITEM 9. LEGAL PROCEEDINGS 8
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS 9
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT 9
ITEM 12. DESCRIPTION OF SECURITIES 10
ITEM 13. INTEREST OF NAMED EXPERTS AND COUNSEL 10
ITEM 14. DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES 10
ITEM 15. ORGANIZATION WITHIN THE LAST FIVE YEARS 11
ITEM 16. DESCRIPTION OF BUSINESS 11
ITEM 17. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION 11
ITEM 18. DESCRIPTION OF PROPERTY 12
ITEM 19. CERTAIN RELATIONSHIPS AND RELATIONSHIPS 12
ITEM 20. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS 12
ITEM 21. EXECUTIVE COMPENSATION 14
ITEM 22. FINANCIAL STATEMENTS 14
ITEM 23. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE 14
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS 16
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION 16
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES. 16
ITEM 27. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 16
ITEM 28. UNDERTAKINGS 16
ITEM 3. SUMMARY INFORMATION AND RISK FACTORS
Summary Information
THE COMPANY
The Company was incorporated under the laws of the State of
Nevada on October 27, 1999 as Company 2.Com, Inc. and filed for a
name change on January 25, 2000. Its principal executive offices
are located at 11777 San Vicente Blvd., Suite 702, Los Angeles,
CA 90049.
THE OFFERING
<TABLE>
<S> <C>
Common stock offered by 2,500,000 shares
Selling Shareholders
(1)...........
Common stock to be 5,000,000 shares
outstanding (1)
after the
offering...............
Use of proceeds............. Purchase goods, materials,
hire employees
OTCBB symbol............ To Be Applied For
</TABLE>
(1) Represents shares of common stock outstanding at April 7,
2000 excluding:
___0___ shares of common stock reserved for future issuance
under our stock option plan; and
____0__ shares of common stock issuable upon exercise of
stock options outstanding as of May 15, 1999, ____0__ of which
are currently exercisable.
* * *
Risk Factors
The Company's business is subject to numerous risk factors,
including the following:
NO OPERATING HISTORY OR REVENUE AND MINIMAL ASSETS. The Company
has had no operating history and has received no revenues or
earnings from operations. The Company has no significant assets
or financial resources. The Company will, in all likelihood,
sustain operating expenses without corresponding revenues, at
least until it is able to secure financing to hire employees who
know the necktie industry. This may result in the Company
incurring a net operating loss which will increase continuously
until the Company raises enough capital to start manufacturing
neckties.
SPECULATIVE NATURE OF COMPANY'S PROPOSED OPERATIONS. 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 company after knowledgeable personnel is hired.
While management intends to hire appropriate personnel who have
an operating knowledge of the necktie industry, it cannot assure
that the Company will successfully locate employees meeting such
criteria. In the event the Company does raise enough capital to
hire key employees and purchase material the success of the
company is dependent upon numerous other factors beyond the
Company's control.
SCARCITY OF AND COMPETITION FOR BUSINESS OPPORTUNITIES. The
Company is, and will continue to be, an insignificant participant
in the business of manufacturing neckties for the businessman. A
large number of established and well-financed entities, are
active in the business of retailing and manufacturing neckties.
Nearly all such entities have significantly greater financial
resources, technical expertise, and managerial capabilities than
the Company. The Company is, consequently, at a competitive
disadvantage in being able to manufacture and become a successful
company in the clothing industry.
NO AGREEMENT FOR THE MANUFACTURE OR SUPPLYING OF MATERIALS OR
OTHER TRANSACTION. The Company has no arrangement, agreement, or
understanding with respect to supplying material or personnel to
aid in the operation of the business. There can be no assurance
the Company will successfully raise enough capital to hire
personnel or be able to purchase material to manufacture
neckties. The Company has been in the developmental stage since
inception and has no operations to date. Other than issuing
shares to its original shareholders, the Company never commenced
any operational activities other than identifying the industry
that management believes that there is an opportunity for
success. The Company has not established a specific length of
operating history or a specified level of earnings, assets, net
worth or other criteria which it will require to be able to
manufacture and distribute its neckties.
CONTINUED MANAGEMENT CONTROL, LIMITED TIME AVAILABILITY. While
seeking investment and personnel with knowledge of the necktie
industry, management anticipates devoting up to twenty hours per
week to the business of the Company. The Company's officers have
not entered into written employment agreements with the Company
and are not expected to do so in the foreseeable future. The
Company has not obtained key man life insurance on its officers
or directors. Notwithstanding the combined limited experience and
time commitment of management, loss of the services of any of
these individuals would adversely affect development of the
Company's business and its likelihood of continuing operations.
See "MANAGEMENT."
CONFLICTS OF INTEREST - GENERAL. The Company's officers and
directors do not participate in other business ventures, which
compete directly with the Company. Additional conflicts of
interest and non "arms-length" transactions may also arise in the
event the Company's officers or directors are involved in the
management of any firm with which the Company transacts business.
The Company's Board of Directors has adopted a resolution which
prohibits the Company from entering into any agreement with any
entity in which management serve as officers, directors or
partners, or in which they or their family members own or hold
any ownership interest. Management is not aware of any
circumstances under which this policy could be changed while
current management is in control of the Company. See "ITEM 10.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS -
CONFLICTS OF INTEREST."
LACK OF MARKET RESEARCH OR MARKETING ORGANIZATION. The Company
has not conducted or received results of market research
indicating that market demand exists for the sale and manufacture
of neckties contemplated by the Company. However, the Company
does plan to establish a marketing organization.
REGULATION. Although the Company will be subject to regulation
under the Securities Exchange Act of 1934, management believes
the Company will not be subject to regulation under the
Investment Company Act of 1940, insofar as the Company will not
be engaged in the business of investing or trading in securities.
The Company has obtained no formal determination from the
Securities and Exchange Commission as to the status of the
Company under the Investment Company Act of 1940 and,
consequently, any violation of such Act would subject the Company
to material adverse consequences.
ITEM 4 USE OF PROCEEDS
The Company intends to seek employees with a knowledge of the
Necktie industry. Additionally, the Company intends to establish
contacts with suppliers for material to be used in the
manufacturing of neckties.
ITEM 5. DETERMINATION OF OFFERING PRICE
The offering price of the shares has been arbitrarily determined
by the Company based upon factors such as the Company's capital
needs and the percentage of ownership to be held by investors as
a result of this offering. The offering price does not
necessarily bear any relationship to assets, book value,
earnings history or other historical factors.
ITEM 6. DILUTION
"Net tangible book value" is the amount that results from
subtracting the total liabilities and intangible assets of an
entity from its total assets. "Dilution" is the difference
between the public offering price of a security such as the
Common Stock, and its net tangible book value per Share
immediately after the Offering, giving effect to the receipt of
net proceeds in the Offering. As of December 22, 1999, the net
tangible book value of the Company was zero. Giving effect to the
sale by the Company of all offered Shares at the public offering
price, the pro-forma net tangible book value of the Company would
be approximately $25,000 or approximately 0.01 per Share, which
would represent no immediate increase in Net Tangible Book Value
per Share and zero per share dilution to new investors.
ITEM 7. SELLING SECURITY HOLDERS
<TABLE>
<S> <C>
Common Stock Beneficially Common Stock to be
Owned Beneficially Owned if
All Shares Offered
Hereunder Are Sold (1)
NONE
</TABLE>
Shares That
May be Offered
<TABLE>
<S> <C> <C> <C> <C>
Name Shares Percent Shares Percent
(2)
N/A
</TABLE>
ITEM 8. PLAN OF DISTRIBUTION
Subject to the terms and conditions of the offering the Company
is offering the shares on a "best efforts, all or none" basis
with respect to the first 1,000,000 Shares, and a "Best efforts"
basis with respect to the remaining 1,500,000 shares. Pending
the sale of at least 1,000,000 Shares, all proceeds of the
offering will be held in a special non-interest bearing account
with Bank of America, Las Vegas, Nevada. Unless at least
1,000,000 Shares are sold within 30 days of the date of the
Prospectus, or 90 days if extended, this offering will terminate
and all funds will be promptly returned to the subscribers
without interest thereon or deduction therefrom. Closing of the
offering could take place as late as two weeks after the maximum
90 day offering period. Once subscriptions for 1,000,000 Shares
($10,000) have been deposited, there will be an initial closing
after which the offering will continue for the remaining
1,500,000 Shares on a "best efforts" basis subject to subsequent
closings. There can be no assurance that any or all of the
Shares being offered will be sold.
ITEM 9. LEGAL PROCEEDINGS
The Company is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by
or against the Company has been threatened.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS
<TABLE>
<S> <C> <C>
Name Age Position
Paul Kessler 39 President/Direc
tor
Scott MacCaughern 42 Secretary/Treasurer/Direct
or
</TABLE>
Paul Kessler; President/Director
Paul Kessler has been an Officer and Director of the Company
since February 20, 2000.
Paul Kessler is currently the President of Bristol Capital,
L.L.C. Mr. Kessler is an emerging growth investor in both private
and public companies and has funded and contributed to the
success of many companies in the past decade. He is adept in the
recognition of investment trends and has substantial experience
with capital markets including investment banking. Mr. Kessler
has held various senior executive positions within the securities
industry and has been a private institutional investor for the
past five years. Mr. Kessler has enjoyed identifying unique
opportunities. Using this expertise, he develops and implements
innovative financial solutions for both private and emerging
growth public companies. Mr. Kessler is Co-founder of The Los
Angeles Film School, and was Chairman of The Entertainment
Internet and Managing Director with Ambient Capital Group, a
leading institutional investment bank.
Scott MacCaughern, Secretary/Treasurer/Director
Scott MacCaughern has been an Officer and Director of the Company
since February 20, 2000.
Since 1995, Mr. MacCaughern has been president of Mac Caughern
Trade Development, which is a national full service
communications company to the Capital Markets. For the past 7
years, Mac Caughern Trade Development has focused on management
and financial consulting services, specializing in strategic
marketing, establishing distribution channels for products,
mergers and acquisitions and financial public relations. Mac
Caughern Trade Development is a recognized leader in investor
relations and assisting clients in the quest for Capital.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth each person known to the Company,
as of March 16, 2000, to be a beneficial owner of five percent
(5%) or more of the Company's common stock, by the Company's
directors individually, and by all of the Company's directors and
executive officers as a group. In this case, the only holders of
more than 5% of the Company's common stock are the directors and
executive officers, so only one table is shown.
<TABLE>
<S> <C> <C> <C>
Title of Name/Address Shares Percentage
Class of Owner Beneficially Ownership
Owned
Common Paul Kessler 1,500,000 50.00%
11777 San Vicente Blvd.,
Suite 702
Los Angeles, CA 90049
Common Scott MacCaughern 1,500,000 50.00%
11777 San Vicente Blvd.,
Suite 702
Los Angeles, CA 90049
</TABLE>
ITEM 12. DESCRIPTION OF SECURITIES
The Company's Articles of Incorporation authorizes the issuance
of 25,000,000 shares of Common Stock, par value $0.001 per share.
The shares are non-assessable, without pre-emptive rights, and do
not carry cumulative voting rights. Holders of common shares are
entitled to one vote for each share on all matters to be voted on
by the stockholders. The shares are fully paid, non-assessable,
without pre-emptive rights, and do not carry cumulative voting
rights. Holders of common shares are entitled to share ratably in
dividends, if any, as may be declared by the Company from time-to-
time, from funds legally available. In the event of a
liquidation, dissolution, or winding up of the Company, the
holders of shares of common stock are entitled to share on a pro-
rata basis all assets remaining after payment in full of all
liabilities.
Management is not aware of any circumstances in which additional
shares of any class or series of the Company's stock would be
issued to management or promoters, or affiliates or associates of
either.
Shares Eligible for Future Sale
All shares registered in the instant offering shall be eligible
for resale to the general public should there be a need for this
type of securities. The Company makes no representations or
guarantee that the shares registered hereunder shall have a
market for resale.
ITEM 13. INTEREST OF NAMED EXPERTS AND COUNSEL
There is no interest of any expert to disclose.
ITEM 14. DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
The Company and its affiliates may not be liable to its
shareholders for errors in judgment or other acts, or omissions
not amounting to intentional misconduct, fraud or a knowing
violation of the law, since provisions have been made in the
Articles of incorporation and By-laws limiting such liability.
The Articles of Incorporation and By-laws also provide for
indemnification of the officers and directors of the Company in
most cases for any liability suffered by them or arising from
their activities as officers and directors of the Company if they
were not engaged in intentional misconduct, fraud or a knowing
violation of the law. Therefore, purchasers of these securities
may have a more limited right of action than they would have
except for this limitation in the Articles of Incorporation and
By-laws.
The officers and directors of the Company are accountable to the
Company as fiduciaries, which means such officers and directors
are required to exercise good faith and integrity in handling the
Company's affairs. A shareholder may be able to institute legal
action on behalf of himself and all others similarly stated
shareholders to recover damages where the Company has failed or
refused to observe the law.
Shareholders may, subject to applicable rules of civil procedure,
be able to bring a class action or derivative suit to enforce
their rights, including rights under certain federal and state
securities laws and regulations. Shareholders who have suffered
losses in connection with the purchase or sale of their interest
in the Company in connection with such sale or purchase,
including the misapplication by any such officer or director of
the proceeds from the sale of these securities, may be able to
recover such losses from the Company.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors,
officers and controlling persons of the small officers and
controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as express in the Act
and is, therefore, unenforceable.
ITEM 15. ORGANIZATION WITHIN THE LAST FIVE YEARS
There are no relationships or transactions to be reported.
ITEM 16. DESCRIPTION OF BUSINESS
Neckties2U, Inc. (the "Company") is a Nevada corporation formed
on October 27, 1999. Its principal place of business is located
at 11777 San Vicente Blvd., Suite 702, Los Angeles, CA 90049. The
Company was organized to engage in any lawful corporate business.
The Company has determined that it is focusing its plan of
operation on the manufacture and sale of men's neckwear. The
company's management does not have any experience in the industry
but hopes through the instant offering that it may be in a
position to hire or consult with persons who have experience and
connections to people and/or entities in the industry.
ITEM 17. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
OPERATION
The company intends to design, manufacture and distribute men's
neckwear to various mid-level clothing stores to sell its ties.
The company currently does not employ any designers or sales
staff but hopes through the instant offering that it can raise
capital so that it may be in a position to hire or consult with
persons who have experience and connections to people and/or
entities in the industry. The company believes there exists a
need for ties in the $20.00-$35.00 range and hopes that its ties
shall be sold in that price range. The Company has done no market
research to verify that this market exists or to indicate its
size.
NOTE REGARDING PROJECTIONS AND FORWARD LOOKING STATEMENTS
This statement includes projections of future results and
"forward-looking statements" as that term is defined in Section
27A of the Securities Act of 1933 as amended (the "Securities
Act"), and Section 21E of the Securities Exchange Act of 1934 as
amended (the "Exchange Act"). All statements that are included in
this Registration Statement, other than statements of historical
fact, are forward-looking statements. Although Management
believes that the expectations reflected in these forward-looking
statements are reasonable, it can give no assurance that such
expectations will prove to have been correct. Important factors
that could cause actual results to differ materially from the
expectations are disclosed in this Statement, including, without
limitation, in conjunction with those forward-looking statements
contained in this Statement.
ITEM 18. DESCRIPTION OF PROPERTY
The Company neither owns nor leases any real property at this
time. The Company does have the use of a limited amount of office
space from its Resident Agent, Premier Corporate Services, Inc.,
located at 1000 N. Green Valley Pkwy. #440-195, Henderson, NV
89014, at no cost to the Company, and Management expects this
arrangement to continue. The Company pays its own charges for
long distance telephone calls and other miscellaneous
secretarial, photocopying, and similar expenses. This is a verbal
agreement between the Resident Agent and the Board of Directors.
ITEM 19. CERTAIN RELATIONSHIPS AND RELATIONSHIPS
The Board of Directors has passed a resolution which contains a
policy that the Company will not do business with any entity in
which any of the Company's Officers, Directors, principal
shareholders or their affiliates or associates serve as officer
or director or hold any ownership interest. Management is not
aware of any circumstances under which this policy may be changed
through their own initiative.
ITEM 20. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
Capitalization
The Company is authorized to issue 25,000,000 shares of Common
Stock, $0.001 par value per share.
The Company's stock is not listed on any exchange. Management has
not undertaken any discussions, preliminary or otherwise, with
any prospective market maker concerning the participation of such
market maker in the after-market for the Company's securities and
management does not intend to initiate any such discussions until
such time as the Company has raised enough capital to hire
employees and enter into contracts with material suppliers and is
conducting business. There is no assurance that a trading market
will ever develop or, if such a market does develop that it will
continue.
Market Price
The Registrant's Common Stock is not quoted on any exchange at
the present time.
Effective August 11, 1993, the Securities and Exchange Commission
adopted Rule 15g-9, which established the definition of 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 or
with an exercise price of less than $5.00 per share, subject to
certain exceptions. For any transaction involving a penny stock,
unless exempt, the rules require: (i) that a broker or dealer
approve a person's account for transactions in penny stocks; and
(ii) the broker or dealer receive from the investor a written
agreement to the transaction, setting forth the identity and
quantity of the penny stock to be purchased. In order to approve
a person's account for transactions in penny stocks, the broker
or dealer must (i) obtain financial information and investment
experience and objectives of the person; and (ii) make a
reasonable determination that the transactions in penny stocks
are suitable for that person and that person has sufficient
knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks. The broker
or dealer must also deliver, prior to any transaction in a penny
stock, a disclosure schedule prepared by the Commission relating
to the penny stock market, which, in highlight form, (i) sets
forth the basis on which the broker or dealer made the
suitability determination; and (ii) that the broker or dealer
received a signed, written agreement from the investor prior to
the transaction. Disclosure also has to be made about the risks
of investing in penny stocks in both public offerings and in
secondary trading, and about commissions payable to both the
broker-dealer and the registered representative, current
quotations for the securities and the rights and remedies
available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements have to be sent
disclosing recent price information for the penny stock held in
the account and information on the limited market in penny
stocks.
The National Association of Securities Dealers, Inc. (the
"NASD"), which administers NASDAQ, has recently made changes in
the criteria for initial listing on the NASDAQ Small Cap market
and for continued listing. For initial listing, a company must
have net tangible assets of $4 million, market capitalization of
$50 million or net income of $750,000 in the most recently
completed fiscal year or in two of the last three fiscal years.
For initial listing, the common stock must also have a minimum
bid price of $4 per share. In order to continue to be included on
NASDAQ, a company must maintain $2,000,000 in net tangible assets
and a $1,000,000 market value of its publicly-traded securities.
In addition, continued inclusion requires two market-makers and a
minimum bid price of $1.00 per share.
However, there can be no assurances that the Company will qualify
its securities for listing on NASDAQ or some other national
exchange, or be able to maintain the maintenance criteria
necessary to insure continued listing. The failure of the Company
to qualify its securities or to meet the relevant maintenance
criteria after such qualification in the future may result in the
discontinuance of the inclusion of the Company's securities on a
national exchange. In such events, trading, if any, in the
Company's securities may then continue in the non-NASDAQ over-the-
counter market. As a result, a shareholder may find it more
difficult to dispose of, or to obtain accurate quotations as to
the market value of, the Company's securities.
Holders
There are currently 2 holders of the Company's stocks. The
Company issued 1,500,000 shares each to the current officers and
directors.
Dividends
The Registrant has no plans to pay any dividends in the future
upon issuance of the Company's stock.
ITEM 21. EXECUTIVE COMPENSATION
None of the Company's officers and/or directors receive any
compensation for their respective services rendered to the
Company, nor have they received such compensation in the past.
They both have agreed to act without compensation until
authorized by the Board of Directors, which is not expected to
occur until the Registrant has generated revenues from
operations. As of the date of this registration statement, the
Company has no funds available to pay directors. Further, none of
the directors are accruing any compensation.
No retirement, pension, profit sharing, stock option or insurance
programs or other similar programs have been adopted by the
Registrant for the benefit of its employees.
ITEM 22. FINANCIAL STATEMENTS
The financial statements and supplemental data required follow
the index of financial statements appearing at Item 27 of this
Form SB-2.
ITEM 23. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
The Registrant has not changed accountants since its formation,
and Management has had no disagreements with the findings of its
accountants.
AVAILABLE INFORMATION
We have filed a Registration Statement on Form SB-2 with the
Commission under the Securities Act for the registration of the
common stock offered by this prospectus. For purposes of this
prospectus, the term Registration Statement means the initial
registration statement and any and all amendments thereto. This
prospectus omits certain information contained in the
registration statement as permitted by the rules and regulations
of the Commission. For further information with respect to us and
the common stock offered, please refer to the registration
statement, including the exhibits thereto. Statements contained
in this prospectus concerning the contents of any contract or
other document are not necessarily complete, and where such
contract or other document is an exhibit to the registration
statement, or otherwise, each such statement, is qualified by the
provisions of such exhibit.
As a result of this offering, we will become subject to the
informational requirements of the Exchange Act, and in accordance
therewith will file reports, proxy and information statements,
and other information with the Commission. Reports, registration
statements, proxy and information statements, and other
information filed by us with the Commission. The registration
statement can be inspected and copied at prescribed rates at the
public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, NW, Room 1024, Washington,
D.C. 20549, and at its regional offices located At 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661; and Seven
World Trade Center, Suite 1300, New York, New York 10048. Copies
of these materials may be obtained at prescribed rates from the
Public Reference Section of the Commission at 450 Fifth Street,
NW, Room 1024, Washington, D.C. 20549. by calling 1-800-SEC-0330.
The Commission maintains a site on the World Wide Web
(http://www.sec.gov) that contains reports, registration
statements, proxy and information statements, and other
information.
Inflation
We do not believe that inflation has had a material impact on our
operations.
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Information on this item is set forth in Propsectus under the
heading "Disclosure of Commission Position on Indemnification for
Securities Act Liabilities."
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
Information on this item is set forth in the Prospectus under the
heading "Use of Proceeds."
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.
With respect to the issuances of stock made, the Registrant
relied on Section 4(2) of the Securities Act of 1933, as amended.
No advertising or general solicitation was employed in offering
the shares. The securities were not offered for the purpose of
resale or distribution, and the transfer thereof was
appropriately restricted.
ITEM 27. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(A) The following documents are filed as exhibits to this
Registration Statement:
Financial Statements as of December 31, 1999.
Exhibit Description.
3.1 Articles of Incorporation
3.2 Bylaws of the Registrant
27 Financial Data Schedule
ITEM 28. UNDERTAKINGS
The undersigned registrant hereby undertakes to:
(a) (1) File, during any period in which it offers or sells
securities, a post-effective amendment to this
registration statement to:
i. Include any prospectus required by section 10(a)(3) of the
Securities Act;
ii. Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information in the registration statement; and Notwithstanding
the forgoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would
not exceed that which was registered) and any deviation From the
low or high end of the estimated maximum offering range may be
reflected in the form of prospects filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in the
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
iii. Include any additional or changed material information on
the plan of distribution.
(2) For determining liability under the Securities Act, treat
each post-effective amendment as a new registration statement of
the securities offered, and the offering of the securities at
that time to be the initial bona fide offering.
(3) File a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the
offering.
(d) Provide to the underwriter at the closing specified in the
underwriting agreement certificates in such denominations and
registered in such names as required by the underwriter to permit
prompt delivery to each purchaser.
(e) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors,
officers and controlling persons of the small business issuer
pursuant to the foregoing provisions, or otherwise, the small
business issuer has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the small
business issuer of expenses incurred or paid by a director,
officer or controlling person of the small business issuer in the
successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection
with the securities being registered, the small business issuer
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
______________________________________________
SIGNATURES
In accordance with the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements of filing on Form
SB-2 and authorized this registration statement to be signed on
its behalf by the undersigned, in the City of Las Vegas, State of
Nevada, on April 7, 2000.
Neckties2U, Inc.
By: /s/ Paul Kessler
Paul Kessler, President
Articles of Incorporation
of
Company 2.Com, Inc.
KNOW ALL MEN BY THESE PRESENTS:
That we, the undersigned, for the purpose of association to
establish a corporation for the transaction of business and the
promotion and conduct of the objects and purposes hereinafter
stated, under the provisions of and subject to the requirements
of the laws of the State of Nevada, do make, record and file
these Articles of Incorporation in writing.
AND WE DO HEREBY CERTIFY:
ARTICLE ONE: The name of this Corporation is:
Company 2.Com, Inc.
Article Two: The principal office in the State of Nevada is to
be located at:
2080 E. Flamingo Rd., Suite 112, Las Vegas, NV 89119
The Resident agent for this Corporation shall be:
Chapman & Flanagan, Ltd., 2080 E. Flamingo Rd., Suite 112, Las
Vegas, NV 89119.
This Corporation may also maintain an office or offices at
such other places within or outside the State of Nevada, as it
may from time to time determine. Corporate business of every
kind and nature may be conducted, and meetings of directors
and stockholders held outside the State of Nevada, the same as
in the State of Nevada.
Article Three: This Corporation may engage in any lawful
activity.
Article Four: This Corporation is authorized to issue only one
class of shares of stock, the total number of which is 25,000,000
shares, each with par value of $0.001. Such stock may be issued
by this Corporation from time to time by the Board of Directors
thereof. The shares of stock shall be designated "Common Stock"
and the holders thereof shall be entitled to one (1) vote for
each share held by them.
Article Five: No Director or Officer of this Corporation shall
be liable to this Corporation or its stockholders for any breach
of fiduciary duty as Officer or Director of this Corporation.
This provision shall not affect liability for acts or omissions
which involve intentional misconduct, fraud, a knowing violation
or law, or the payment of dividends in violation of NRS 78.300.
All expenses incurred by Officers or Directors in defending a
civil or criminal action, suit, or proceeding, must be paid by
this Corporation as they are incurred in advance of a final
disposition of the action, suit or proceeding, upon receipt of
an undertaking by or on behalf of a Director or Officer to
repay the amount if it is ultimately determined by a court of
competent jurisdiction, that he or she did not act in good
faith, and in the manner he or she reasonably believed to be
or not opposed to the best interests of this Corporation.
The members of the governing Board shall be styled Directors,
and the number of Directors shall not be less than one (1)
pursuant to the terms of NRS 78.115. The names and addresses
of the first Board of Directors, which shall consist of two
(2) members are:
<TABLE>
<S> <C>
Daniel G. 2080 E. Flamingo Rd.,
Chapman Suite 112, Las Vegas, NV
89119
Sean P. Flanagan 2080 E. Flamingo Rd., Suite 112, Las
Vegas, NV 89119
</TABLE>
The number of Directors of this Corporation may from time to
time be increased or decreased as set forth hereinabove by an
amendment to the By-Laws in that regard, and without the
necessity of amending these Articles of Incorporation.
The name and address of the incorporators are:
<TABLE>
<S> <C>
Daniel G. 2080 E. Flamingo Rd.,
Chapman Suite 112, Las Vegas, NV
89119
Sean P. Flanagan 2080 E. Flamingo Rd., Suite 112, Las
Vegas, NV 89119
</TABLE>
Article Six: The capital stock of this Corporation, after the
amount of the subscription price has been paid in cash or in
kind, shall be and remain non-assessable and shall not be subject
to assessment to pay debts of this Corporation.
Article Seven: This Corporation shall have perpetual
existence.
Article Eight: No holder of any shares of this Corporation
shall have any preemptive right to purchase, subscribe for, or
otherwise acquire any shares of this Corporation of any class now
or hereafter authorized, or any securities exchangeable for or
convertible into such shares, or warrants or other instruments
evidencing rights or options to subscribe for, purchase or
otherwise acquire such shares.
Article Nine: This Corporation shall not be governed by the
provisions of NRS 78.411 to 78.444, inclusive.
Executed this 26th day of October, 1999.
<TABLE>
<S> <C>
/s/ Daniel G. Chapman /s/ Sean P. Flanagan
Daniel G. Chapman, Sean P. Flanagan, Incorporator
Incorporator
</TABLE>
By-Laws
of
Company 2.Com, Inc.
ARTICLE I
Meetings of Stockholders
Section 1. The annual meeting of the stockholders of this
Corporation shall be held at the principal executive office of
this Corporation, or at any other place, within or outside of the
State of Nevada, specified by the Board of Directors. The annual
meeting of the stockholders, after the year of incorporation,
shall be held at the time and date in each year fixed by the
Board of Directors. The meeting shall be held for the purpose of
electing directors of this Corporation to serve during the
ensuing year and for the transaction of such other business as
may be brought before the meeting.
At least ten (10) days' written notice specifying the day,
hour and place when and where the annual meeting shall be
convened, shall be mailed in a United States Post Office
addressed to each of the stockholders of record at the time of
issuing the notice at his, her or its address last known as it
appears on the books of this Corporation.
Section 2. Special meetings of the stockholders may be held
at the office of this Corporation in the State of Nevada, or
elsewhere, whenever called by the President, by the Board of
Directors, or by a vote of or an instrument in writing signed by
the holders of at least a majority of the issued and outstanding
capital stock of this Corporation. At least ten (10) days'
written notice specifying the day, hour and place when and there
the annual meeting shall be convened, shall be mailed in a United
States Post Office addressed to each of the stockholders of
record at the time of issuing the notice at his, her or its
address last known as it appears on the books of this
Corporation.
Section 3. If all the stockholders of this Corporation shall
waive notice of a meeting, no notice of such meeting shall be
required, and whenever all of the stockholders shall meet in
person or by proxy, such meeting shall be valid for all purposes,
without call or notice, and at such meeting any corporate action
may be taken.
The written certificate of the officer or officers calling any
meeting, setting forth the substance of the notice and the
day, hour and place of the mailing of the same to the several
stockholders, and the respective addresses to which the same
were mailed shall be prima facie evidence of the manner and
fact of the calling and giving of such notice.
If the address of any stockholder does not appear upon the books
of this Corporation, it will be sufficient to address any
notice to such stockholder at the principal office of this
Corporation.
Section 4. All business lawful to be transacted by the
stockholders of this Corporation may be transacted at any special
meeting or at any adjournment thereof. Only such business
referred to in the notice calling such special meeting, however,
shall be acted upon during such special meeting or adjournment,
unless all of the outstanding capital stock of this Corporation
is represented either in person or by proxy, in which case any
lawful business may be transacted, and such meeting shall be
valid for all purposes.
Section 5. At the stockholders' meetings, the holders of a
majority of the entire issued and outstanding capital stock of
this Corporation shall constitute a quorum for all purposes. If
the holders of the amount of stock necessary to constitute a
quorum shall fail to attend (at the time and place fixed by these
By-Laws for any annual meeting, or fixed by a notice as provided
above for any special meeting), either in person or by proxy, a
majority in interest of the stockholders present in person or by
proxy may adjourn from time-to-time without notice other than by
announcement at the meeting, until holders of the amount of stock
requisite to constitute a quorum shall attend. Any business that
might have been transacted at the originally-called meeting may
be transacted at any such adjourned meeting at which a quorum
shall be present.
Section 6. At such meeting of the stockholders, every
stockholder shall be entitled to vote in person or by his duly-
authorized proxy appointed by instrument in writing subscribed by
such stockholder of by his duly-authorized attorney. Each
stockholder shall have one (1) vote for each share of stock
standing registered in his, her or its name on the book of the
Corporation, ten (10) days preceding the day of such meeting. The
votes for directors, and upon demand by any stockholder, upon any
question properly before the meeting, shall be by viva voce.
At each meeting of the stockholders, a full, true and complete
list, in alphabetical order, indicating all stockholders
entitled to vote at such meeting and the number of shares held
by each such stockholder, certified by the Secretary of this
Corporation, shall be furnished. The list shall be prepared at
least ten (10) days before such meeting and shall be open to
inspection by the stockholders, their agents or their proxies,
at the place where such meeting is to be held, and for ten
(10) days prior thereto. Only persons in whose names shares of
stock are registered on the books of this Corporation for ten
(10) days preceding the date of such meeting, as evidenced by
the list of stockholders, shall be entitled to vote at such
meeting. Proxies and powers-of-attorney to vote must be filed
with the Secretary of this Corporation before an election or a
meeting of the stockholders, or they cannot be used at such
election or meeting.
Section 7. At each meeting of the stockholders, the polls
shall be opened and closed; the proxies and ballots issued,
received, and be taken in charge of, for the purpose of the
meeting, and all questions touching the qualifications of voters
and the validity of proxies, and the acceptance or rejection of
votes, shall be decided by two inspectors. Such inspectors shall
be appointed at the meeting by the presiding officer of the
meeting.
Section 8. At the stockholders' meetings the regular order of
business shall be as follows:
Reading and approving the Minutes of previous meeting or
meetings;
Reports of the Board of Directors, President, Treasurer,
and/or Secretary of this Corporation in the order listed;
Reports of any Committee;
Election of Directors;
Unfinished business;
New business;
Adjournment.
ARTICLE II
Directors and Their Meetings
Section 1. The Board of Directors of this Corporation shall
consist of no less than one (1) and no more than five (5) persons
who shall be chosen by the stockholders at the annual meeting.
Each Director shall hold office for one year, and until his or
her successor is elected and qualified. The initial Board shall
consist of five (5) Directors.
Section 2. When any vacancy occurs among the Directors as a
result of death, resignation, disqualification or other cause,
the stockholders, at any regular or special meeting, or at any
adjourned meeting thereof, or the remaining Directors, if any, by
the affirmative vote of a majority thereof, shall elect a
successor to hold office for the unexpired portion of the term of
the Director whose place shall have become vacant and until his
or her successor is elected and qualified.
Section 3. The meeting of the Directors may be held at the
principal office of this Corporation in the State of Nevada, or
elsewhere, at such place or places as the Board of Directors may,
from time-to-time, determine.
Section 4. Regular meetings of the Board of Directors shall
be held as often as necessary. Notice of such regular meetings
shall be mailed to each director by the Secretary at least three
(3) days prior to the day fixed for such meeting. No regular
meeting shall be held void or invalid if such notice is not
given, provided that the meeting is held at the time and place
fixed by these By-Laws for holding such regular meetings.
Special meetings of the Board of Directors may be held on the
call of the President or Secretary on at least three (3) days'
notice by mail or telegraph.
Any meeting of the Board, no matter where held, at which all
of the members shall be present, even though without notice,
or of which notice shall have been waived by all absent
Directors, shall be valid for all purposes, provided a quorum
shall be present, unless otherwise indicated in the notice
calling the meeting or in the waiver of notice.
Any and all business may be transacted at any regular or
special meeting of the Board of Directors.
Section 5. A majority of the Directors in office shall
constitute a quorum for the transaction of business. At any
meeting at which less than a quorum is present, a majority of
Directors present may vote to adjourn from time-to-time until a
quorum shall be present; no notice of such adjournment shall be
required. The Board of Directors may prescribe rules not in
conflict with these By-Laws for the conduct of its business;
provided, however, that in fixing salaries for officers of this
Corporation, the unanimous action of all Directors shall be
required.
Section 6. A Director need not be a stockholder of this
Corporation.
Section 7. The Directors shall be allowed and paid all
necessary expenses incurred in attending any meeting of the
Board, but shall not receive any compensation for their services
as directors until such time as this Corporation is able to
declare and pay dividends on its capital stock.
Section 8. The Board of Directors shall make a report to the
stockholders at annual meetings of the stockholders and shall,
upon request, furnish a true copy of such report to each
stockholder. The Board, in its discretion, may submit any
contract or act for approval or ratification at any meeting of
stockholders called for the purpose of considering any such
contract or act, provided a quorum is present.
Section 9. The Board of Directors shall have the power from
time-to-time to provide for the management of the offices of this
Corporation in such manner as they see fit, and in particular,
from time-to-time to delegate any of the powers of the Board in
the course of the current business of this Corporation to any
standing or special committee or to any officer or agent and to
appoint any persons to be agents of this Corporation with such
powers (including the power to sub-delegate), and upon such terms
as may be deemed fit.
Section 10. At meetings of the Board of Directors, the regular
order of business shall be as follows:
Reading and approving the Minutes of previous meeting or
meetings;
Reports of Officers and Committee-members;
Election of Officers;
Unfinished business;
New business;
Adjournment.
ARTICLE III
Officers and Their Duties
Section 1. The officers of this Corporation shall consist of
the President, the Secretary, and the Treasurer, each of whom
shall be appointed by the Board of Directors. This Corporation
may also have one or more Vice Presidents, Assistant Secretaries,
or Assistant Treasurers. The Board of Directors may appoint other
officers. The order of seniority of the Vice Presidents, if any
such officers exist, shall be the order of their nomination
unless otherwise determined by the Board of Directors. Any two or
more of such offices may be held by the same individual. The
Board of Directors shall designate one officer as the chief
financial officer (CFO) of this Corporation. In the absence of
such designation, the Treasurer shall be the CFO. The Board of
Directors may appoint, and may empower the President to appoint,
such other officers as the business of this Corporation may
require. Each of these other officers shall have such authority
and may perform such duties as are provided in these By-Laws or
as the Board of Directors may determine from time-to-time. The
salary and other compensation of officers shall be fixed from
time-to-time by resolution or in the manner determined by the
Board of Directors.
Each officer of this Corporation shall hold office from the
date elected to the date when his or her successor is elected;
provided that all officers, as well as any employee or agent
of this Corporation, may be removed at any time at the
pleasure of the Board of Directors. Nothing in these By-Laws
shall be construed as creating any kind of contractual right
to employment with this Corporation. Any officer may resign at
any time by giving written notice to the Board of Directors,
the President or the Secretary of this Corporation. Receipt of
such notice, however, is without prejudice to the rights, if
any, of this Corporation under any contract to which such
officer is a party. Any such resignation shall take effect at
the date of receipt or at such later time specified therein.
Unless otherwise specified therein, acceptance of such
resignation is not necessary for the resignation to become
effective. A vacant office may be filled by vote of the Board
of Directors, or the Board may vest an officer with the power
to fill a vacant office.
Section 2. The President shall be the executive officer of
this Corporation and shall have a duty to supervise, control and
manage the day-to-day operation of this Corporation, subject only
to directions from the Board of Directors with regard to the
direction of this Corporation's affairs. The President shall have
full power to execute any and all documents for and on behalf of
this Corporation, including, but not limited to, entering into
leases for real property, equipment, furniture, furnishings,
hiring and firing all personnel, setting and establishing
operational manuals and policies, entering into contracts
necessary for the day-to-day operation of this Corporation,
establishing lines of credit for this Corporation and accounts
payable thereof; except when such powers have been specifically
limited by the Board of Directors. The President shall also be a
member and chairman of any Executive Committee that may be
established; shall preside at all meetings of the Board of
Directors and all meetings of stockholders; shall sign all
Certificates of Stock issued by this Corporation; perform any and
all other duties prescribed by the Board of Directors which can
be performed during the normal work period.
Section 3. The Vice Presidents (if any such officers are
appointed), in order of their seniority, may assume and perform
the duties of the President in the absence or disability of the
President, or at such times that the office of the President is
vacant. The Vice Presidents shall have such titles, perform such
other duties, and have such other powers as the Board of
Directors, the President, or these By-Laws may designate from
time-to-time.
Section 4. The Treasurer shall keep and maintain, or cause to
be kept and maintained, adequate and correct accounts of the
properties and business transactions of this Corporation. The
books of account shall at all reasonable times be open to
inspection by any Director.
The Treasurer shall deposit all moneys and other valuables in
the name of and to the credit of this Corporation, with such
depositories as may be designated by the Board of Directors.
The Treasurer shall render to the President and the Directors,
whenever they request, an account of all the Treasurer's
transactions as Treasurer, and of the financial condition of
this Corporation.
The Treasurer shall be responsible for the establishment and
maintenance of accounting and other systems required to
control and account for the assets of this Corporation, and
provide safeguards therefore; to collect information required
for management purposes; and to perform such other duties, and
to have such other powers, as the Board of Directors or the
President may designate from time-to-time.
The President may direct any Assistant Treasurer to assume and
perform the duties of the Treasurer in the absence or
disability of the Treasurer, and each Assistant Treasurer
shall perform such other duties and have such other powers as
the Board of Directors or the President may designate from
time-to-time.
Section 5. The Secretary shall keep the minutes of all
meetings of the Board of Directors, the stockholders, and the
Executive Committee, if any, in books provided for such purpose.
The Secretary shall attend to the giving and serving of all
notices of this Corporation; may sign with the President or Vice
President, in the name of this Corporation, all contracts
authorized by the Board of Directors or Executive Committee;
shall affix the corporate seal of this Corporation thereto when
so authorized by the Board of Directors or Executive Committee;
shall have custody of the corporate seal; shall affix the
corporate seal to all Certificates of Stock duly issued by this
Corporation; shall have charge of the Stock Certificate Books,
Transfer Books, Stock Ledgers and such other books and papers as
the Board of Directors or Executive Committee may direct, all of
which shall at all reasonable times be open to the examination of
any Director upon application at the office of this Corporation
during business hours; and shall, in general, perform all duties
incident to the office of Secretary.
Section 6. The Board of Directors may appoint an Assistant
Secretary who shall have such powers and perform such duties as
may be prescribed by the Secretary or the Board of Directors.
Section 7. Unless otherwise ordered by the Board of
Directors, the President shall have full power and authority on
behalf of this Corporation to attend and to act and vote at any
meeting of the stockholders of any corporation in which this
Corporation may hold stock. At such meetings, the President shall
possess and may exercise any and all rights and powers incident
to the ownership of such stock, and which, as the owner thereof,
this Corporation might have possessed and exercised if present.
The Board of Directors, by resolution, from time-to-time, may
confer like powers on any person or persons in place of the
President to represent this Corporation for the purposes in this
section mentioned.
ARTICLE IV
Capital Stock
Section 1. The capital stock of this Corporation shall be
issued in such manner, at such times, and upon such conditions as
shall be prescribed by the Board of Directors.
Section 2. Ownership of stock in this Corporation shall be
evidenced by Certificates of Stock in such forms as shall be
prescribed by the Board of Directors, and shall be under the seal
of this Corporation and signed by the President or Vice President
and the Secretary or Assistant Secretary. No certificate shall be
valid unless it is so signed.
All Certificates shall be numbered consecutively. The name of
the person owning the shares represented thereby with the
number of such shares and the date of issue shall be entered
upon the books of this Corporation.
All certificates surrendered to this Corporation shall be
canceled. No new certificate shall be issued until the former
certificate for the same number of shares shall have been
surrendered or canceled.
Section 3. No transfer of stock shall be valid as against
this Corporation except on surrender and cancellation therefore,
accompanied by an assignment or transfer by the owner, made
either in person or under assignment, a new certificate shall be
issued therefore.
Whenever any transfer shall be expressed as made for
collateral security and not absolutely, the same shall be
expressed in the entry of said transfer on the books of this
Corporation.
Section 4. The Board of Directors shall have power and
authority to make all such rules and regulations not inconsistent
herewith as it may deem expedient concerning the issue, transfer
and registration of Certificates for shares of the capital stock
of this Corporation. The Board of Directors may appoint a
transfer agent and registrar of transfers, and may require all
Certificates to bear the signature of such transfer agent and
registrar of transfers.
Section 5. The Stock Transfer Books shall be closed for all
meetings of the stockholders for the period of ten (10) days
prior to such meetings, and shall be closed for the payment of
dividends during such periods as may be fixed from time-to-time
by the Board of Directors. During such periods, no stock shall be
transferable.
Section 6. Any person or persons applying for a Certificate
in lieu of one alleged to have been lost or destroyed shall make
affidavit of affirmation of the fact, and shall deposit with this
Corporation an affidavit. Whereupon, at the end of six months
after the deposit of said affidavit and upon such person or
persons giving bond of indemnity to this Corporation in an amount
double the current value of the stock against any damage, loss,
or inconvenience to this Corporation, which may or can arise in
consequence of a new or duplicate Certificate being issued in
lieu of the one lost or missing, the Board of Directors may cause
to be issued to such person or persons a new Certificate, or a
duplicate of the Certificate so lost or destroyed. The Board of
Directors may, in its discretion, refuse to issue such new or
duplicate Certificate save upon the order of some court having
jurisdiction in such matter, anything herein to the contrary
notwithstanding.
Section 7. All holders of stock of this Corporation are
subject to the provisions of Article IX of these By-Laws.
Section 8. Each certificate evidencing ownership of stock in
this Corporation shall contain the following endorsement upon its
face so as to give notice to any transferee thereof:
"The shares of stock represented by this certificate are subject
to all of the terms expressed in the Corporation's By-Laws,
particularly those in Article IX that restrict the transfer or
encumbrance of these shares. A copy of the By-Laws is on file at
the Corporation's office."
ARTICLE V
Offices and Books
Section 1. The principal office of this Corporation, in
Nevada, shall be:
2080 E. Flamingo Rd., Suite 112, Las Vegas, NV 89119
Section 2. This Corporation may have a principal office in
any other state or territory as the Board of Directors may
designate.
Section 3. The Stock and Transfer Books and a copy of the By-
Laws and Articles of Incorporation of this Corporation shall be
kept at its principal office in the State of Nevada, for the
inspection of all who are authorized or have the right to see the
same, and for the transfer of stock. All other books of this
Corporation shall be kept at such places as may be prescribed by
the Board of Directors.
ARTICLE VI
Indemnification
Section 1. For purposes of this Article, "Indemnitee" shall
mean each Director or Officer who was or is a party to, or is
threatened to be made a party to, or is otherwise involved in,
any Proceeding (as hereinafter defined), by reason of the fact
that he or she is or was a Director or Officer of this
Corporation or is or was serving in any capacity at the request
of this Corporation as a Director, Officer, employee, agent,
partner, or fiduciary of, or in any other capacity for, another
corporation, partnership, joint venture, trust, or other
enterprise. The term "Proceeding" shall mean any threatened,
pending or completed action or suit (including, without
limitation, an action, suit or proceeding by or in the right of
this Corporation), whether civil, criminal, administrative or
investigative.
Each Indemnitee shall be indemnified and held harmless by this
Corporation for all actions taken by him or her, and for all
omissions (regardless of the date of any such action or
omission), to the fullest extent permitted by Nevada law,
against all expense, liability and loss (including, without
limitation, attorney fees, judgments, fines, taxes, penalties,
and amounts paid or to be paid in settlement) reasonably
incurred or suffered by the Indemnitee in connection with any
Proceeding.
Indemnification pursuant to this Section shall continue as to
an Indemnitee who has ceased to be a Director or Officer and
shall inure to the benefit of his or her heirs, executors and
administrators.
This Corporation may, by action of its Board of Directors, and
to the extent provided in such action, indemnify employees and
other persons as though they were Indemnitees.
The rights to indemnification as provided in this Article
shall be non-exclusive of any other rights that any person may
have or hereafter acquire under an statute, provision of this
Corporation's Articles of Incorporation or By-Laws, agreement,
vote of stockholders or Directors, or otherwise.
Section 2. This Corporation may purchase and maintain
insurance or make other financial arrangements on behalf of any
person who is or was a Director, Officer, employee or agent of
this Corporation, or is or was serving at the request of this
Corporation in such capacity for another corporation,
partnership, joint venture, trust or other enterprise for any
liability asserted against him or her and liability and expenses
incurred by him or her in such capacity, whether or not this
Corporation has the authority to indemnify him or her against
such liability and expenses.
The other financial arrangements which may be made by this
Corporation may include, but are not limited to, (a) creating
a trust fund; (b) establishing a program of self-insurance;
(c) securing its obligation of indemnification by granting a
security interest or other lien on any of this Corporation's
assets, and (d) establishing a letter of credit, guarantee or
surety. No financial arrangement made pursuant to this section
may provide protection for a person adjudged by a court of
competent jurisdiction, after exhaustion of all appeals
therefrom, to be liable for intentional misconduct, fraud, or
a knowing violation of law, except with respect to advancing
expenses or indemnification ordered by a court.
Any insurance or other financial arrangement made on behalf of
a person pursuant to this section may be provided by this
Corporation or any other person approved by the Board of
Directors, even if all or part of the other person's stock or
other securities is owned by this Corporation. In the absence
of fraud:
the decision of the Board of Directors as to the propriety
of the terms and conditions of any insurance or other financial
arrangement made pursuant to this section, and the choice of the
person to provide the insurance or other financial arrangement is
conclusive; and
the insurance or other financial arrangement
v is not void or voidable; and
v does not subject any Director approving it to personal
liability for his action,
v even if a Director approving the insurance or other
financial arrangement is a beneficiary of the insurance or other
financial arrangement.
Section 3. The provisions of this Article relating to
indemnification shall constitute a contract between this
Corporation and each of its Directors and Officers, which may be
modified as to any Director or Officer only with that person's
consent or as specifically provided in this section.
Notwithstanding any other provision of the By-Laws relating to
their amendment generally, any repeal or amendment of this
Article which is adverse to any Director or Officer shall apply
to such Director or Officer only on a prospective basis and shall
not limit the rights of an Indemnitee to indemnification with
respect to any action or failure to act occurring prior to the
time of such repeal or amendment. Notwithstanding any other
provision of these By-Laws, no repeal or amendment of these By-
Laws shall affect any or all of this Article so as to limit or
reduce the indemnification in any manner unless adopted by (a)
the unanimous vote of the Directors of this Corporation then
serving, or (b) the stockholders as set forth in ARTICLE VIII
hereof; provided that no such amendment shall have retroactive
effect inconsistent with the preceding sentence.
Section 4. References in this Article to Nevada law or to any
provision thereof shall be to such law as it existed on the date
these By-Laws were adopted or as such law thereafter may be
changed; provided that (a) in the case of any change which
expands the liability of an Indemnitee or limits the
indemnification rights or the rights to advancement of expenses
which this Corporation may provide, the rights to limited
liability, to indemnification and to the advancement of expenses
provided in this Corporation's Articles of Incorporation, these
By-Laws, or both shall continue as theretofore to the extent
permitted by law; and (b) if such change permits this
Corporation, without the requirement of any further action by
stockholders or Directors, to limit further the liability of
Indemnitees or to provide broader indemnification rights or
rights to the advancement of expenses than this Corporation was
permitted to provide prior to such change, liability thereupon
shall be so limited and the rights to indemnification and
advancement of expenses shall be so broadened to the extent
permitted by law.
ARTICLE VII
Miscellaneous
Section 1. The Board of Directors shall have power to reserve
over and above the capital stock paid in, such an amount in its
discretion, as it may deem advisable, to fix as a reserve fund,
and may, from time-to-time, declare dividends from the
accumulated profits of this Corporation in excess of the amounts
so reserved and pay the same to the stockholders of this
Corporation, and may also, if it deems the same advisable,
declare stock dividends of the unissued capital stock of this
Corporation.
Section 2. No agreement, contract or obligation (other than
checks in payment of indebtedness incurred by authority of the
Board of Directors) involving the payment of moneys or the credit
of this Corporation of more than FIVE THOUSAND DOLLARS ($5,000),
shall be made without the authority of the Board of Directors or
of the Executive Committee, if any.
Section 3. Unless otherwise ordered by the Board of
Directors, all agreements and contracts shall be signed by the
President and the Secretary in the name and on behalf of this
Corporation, and shall have the Corporate Seal attached thereto.
Section 4. All moneys of this Corporation shall be deposited
when and as received by the Treasurer in such bank or banks or
other depository as may from time-to-time be designated by the
Board of Directors, and such deposits shall be made in the name
of this Corporation.
Section 5. No note, draft, acceptance, endorsement or other
evidence of indebtedness shall be valid against this Corporation
unless the same shall be signed by the President or Vice
President and attested by the Secretary or an Assistant
Secretary, or signed by the Treasurer or an Assistant Treasurer
and countersigned by the President, Vice President or Secretary,
except that the Treasurer or an Assistant Treasurer may, without
countersignature, make endorsements for deposit to the credit of
this Corporation in all its duly authorized depositories.
Section 6. No loan or advance of money shall be made by this
Corporation to any stockholder or Officer therein, unless the
Board of Directors shall otherwise authorize.
Section 7. No Director or Officer of this Corporation shall
be entitled to any salary or compensation for any services
performed for this Corporation, unless such salary or
compensation shall be fixed by resolution of the Board of
Directors, adopted by the unanimous vote of all the Directors
voting in favor thereof.
Section 8. This Corporation may take, acquire, hold,
mortgage, sell or otherwise deal in stocks, bonds or other
securities of any other Corporation, if and as often as the Board
of Directors shall so elect.
Section 9. The Directors shall have the power to authorize
and cause to be executed, mortgages and liens, without limit as
to amount, upon the property and franchise of this Corporation.
Pursuant to affirmative vote, either in person or by proxy, of
the holders of a majority of the capital stock issued and
outstanding, the Directors shall have the authority to dispose in
any manner of the whole property of this Corporation.
Section 10. This Corporation shall have a Corporate Seal, the
design thereof being as follows:
ARTICLE VIII
Amendment of By-Laws
Section 1. Amendments and changes of these By-Laws may be
made at any regular or special meeting of the Board of Directors
by a vote of not less than all of the entire Board, or may be
made by a vote of, or a consent in writing by the holders of a
majority of the issued and outstanding capital stock.
ARTICLE IX
Restrictions on Transfers of Stock
Section 1 Restrictions
Section 1.1 No stock of this Corporation shall be transferred
on the books of this Corporation unless in compliance with the
terms of this Article.
Section 1.2 Except as otherwise provided below, a shareholder
is hereby prohibited from making a voluntary sale, transfer,
assignment, hypothecation, gift, or any other alienation of any
share or shares in this Corporation, or any right or interest
therein; nor shall a shareholder allow any such share or shares
to become subject to an involuntary transfer by order of a court,
sale upon execution of a judgment, appointment of a receiver or
trustee in bankruptcy for a shareholder, or any other legal
process resulting in a transfer of said shares.
Section 1.3 In the event that a shareholder desires to make a
prohibited voluntary transfer, or has been forced to subject his
stock to a prohibited involuntary transfer, the shareholder shall
be required to offer for sale to this Corporation all of his
shares subject to such a prohibited transfer, at the price and
upon the terms specified in this Article. This Corporation shall
be notified of the offer by the shareholder in writing, and that
shall constitute a notice of disposition of shares within the
meaning of section 2 below.
Section 1.4 Any shares of stock of this Corporation shall be
subject to the terms of this Article, and any holder hereof shall
confirm in writing the holder's obligation to be bound by all of
the terms, provision, options, and restrictions of this Article.
Section 2 Purchase of shares
Section 2.1 Within a period of sixty (60) days following the
delivery of such notice of disposition of shares, this
Corporation shall notify the holder of such shares (the "Selling
Shareholder") if it elects to purchase all or a portion of such
shares.
Section 2.2 The occurrence of any event which would require
transmission to this Corporation of a notice of disposition of
shares shall immediately give rise to all options given herein to
this Corporation and its shareholders to purchase such shares,
and such options may be exercised without regard to whether any
notice of disposition of shares is in fact given by the Selling
Shareholder. The period under section 2.1 above shall not,
however, begin to run until this Corporation, through its
officers or directors, shall have actual knowledge of such event.
Section 2.3 To the extent this Corporation elects not to
purchase such shares or is legally prohibited from doing so, it
shall, within the said sixty (60) day period, so notify all
shareholders of record who own at least twenty percent (20%) of
the outstanding stock of this Corporation (a "Qualified
Shareholder"). Any such shareholder may, within thirty (30) days
after the service of such notice, elect to purchase any part or
all of the stock so offered. Any Qualified Shareholder desiring
to purchase said stock shall notify the Selling Shareholder in
writing within the said thirty (30) day period. In the event more
than one Qualified Shareholder desires to purchase said stock,
those shares shall be prorated among them based upon their
respective holdings in this Corporation.
Section 2.4 In the event this Corporation and all Qualified
Shareholders declines to purchase said stock, the holder may
within a period of six months from the date of giving said notice
sell or transfer said stock as he or she may see fit. The person
or persons acquiring said stock shall hold it subject to all the
terms, conditions and options contained in this Article. If no
transfer is made within the six month period, no further
disposition of said stock may be made without again giving the
notice and providing the option to this Corporation as set forth
herein.
Section 2.5 The purchase price and terms of any purchase under
this Article shall be as set forth in sections 6 and 7 below.
Section 3 Notwithstanding the above provisions, a shareholder may
make a lifetime gift of his stock, whether in trust or outright,
to another shareholder, his parents, or his children or their
issue. Any such gift to a minor shall be subject to the condition
that the same be affirmed by such minor upon attaining the age of
majority and, if not affirmed by a letter in writing to this
Corporation within sixty (60) days after such minor attains
majority, such stock shall be subject to the purchase option
provisions set forth above as if a notice of disposition had been
given on the last day of said period for affirmance, except as
limited by section 9 below.
Section 4 No provision in this Article shall prevent any
shareholder from pledging his shares as security for a debt or
obligation, but such pledge shall provide that in the event of
foreclosure, the person acquiring such shares shall be subject to
the terms and conditions of this Article. A foreclosure shall be
deemed to constitute notice from the purchaser thereof to this
Corporation of a disposition of the stock under section 2 above.
The options thereupon given this Corporation under the terms of
section 2 above shall apply to all foreclosed shares.
Section 5 Death of a Shareholder
Section 5.1 Upon the death of a shareholder, the personal
representative of his estate, trustee of his living trust, or
other successor-in-interest to his shares, shall within thirty
(30) days of the date of the death notify this Corporation of
such death and deliver to this Corporation proof of its authority
to act as the successor-in-interest to the deceased shareholder.
Section 5.2 Upon receipt of the notification of death, this
Corporation shall within sixty (60) days purchase the stock of
the deceased shareholder from the successor-in-interest of the
deceased shareholder according to the provisions of sections 6
and 7 below.
Section 6 Purchase Price
Section 6.1 At least annually, at the annual meeting of this
Corporation or as otherwise mutually agreed, the shareholders
shall determine by unanimous agreement a total value to be placed
upon all outstanding stock of this Corporation.
Section 6.2 The total value of this Corporation's stock shall
be divided by the number of outstanding shares of stock of this
Corporation at the date a notice of disposition is delivered.
This value shall be used to calculate the total value of shares
offered by the Selling Shareholder.
Section 6.3 If, at the time a notice of disposition is
delivered, more than one year has elapsed since the base value
was last determined, the base value shall be the last agreed
value or the net book value of this Corporation determined in
accordance with generally accepted accounting principles,
whichever is higher.
Section 7 Purchase Terms
Section 7.1 The down payment shall be five percent (5%) of the
total purchase price. The down payment shall be in cash at the
time notification is made by the purchaser of his or her election
to purchase, or upon determination of the total purchase price
under the provisions of this Article, whichever is later.
Section 7.2 The balance of the purchase price shall be
represented by a promissory note of the purchaser or purchasers
payable in equal annual installments on the anniversary date of
the payment of the down payment.
Section 7.3 Such promissory note shall be non-negotiable in
form and shall bear interest at the prevailing prime rate for
loans of similar duration charged by the largest bank in the
state of Nevada. Such interest shall be payable on the annual
payment date of principal. The holder of such note shall have the
right to declare the note due and payable in full in the event of
a default in the making of any payment. In the event of the death
of the maker of the note, the unpaid balance of that note shall
become immediately due and payable at the election of the holder
of the note.
Section 7.4 The Selling Shareholder shall, upon receiving the
down payment and the note, if any, for the balance of the
purchase price, endorse the certificates representing the shares
being sold to the purchaser or purchasers of said shares.
Section 7.5 So long as no default occurs in making payments
due under the note, the purchaser of the shares shall be entitled
to receive all dividends thereon and shall be entitled to vote
such shares.
Section 8 Life Insurance
Section 8.1 This Corporation may, if it deems advisable in
order to assure continuity in its management and policies,
purchase life insurance policies in such amounts as it deems
advisable upon the lives of any one or more of its shareholders,
but shall not be obligated to do so. Should such insurance be
purchased, the down payment to be made by reason of sale
following the death of an insured shareholder shall be increased
above the section 7 amount to the lesser of the agreed selling
price as determined in section 6 and the actual amount of the
life insurance proceeds.
Section 8.2 If this Corporation has purchased a life insurance
policy for a shareholder who has sold his shares under the
provisions of this Article during his lifetime, the coverage
shall be continued by this Corporation during the period allowed
for the installment payment of such shares. After final payment
has been made, the Selling Shareholder may purchase from this
Corporation any life insurance policies then in effect at their
cash surrender values.
Section 9 Other Provisions
Section 9.1 Time is of the essence in carrying out the terms
of this Article. Each party, therefore, agrees to perform any
acts herein required of such party and to execute and deliver any
documents required to carry out the provisions of this Agreement
promptly within the time periods herein described.
Section 9.2 Each shareholder agrees to insert in his will a
direction and authorization to his executor to fulfill and comply
with the provisions hereof.
Section 9.3 Notwithstanding any of the restrictions imposed
above, this Corporation has the absolute right to refuse to
record any transfer of stock where such refusal is necessary to
maintain the Corporation's status, where that status is dependent
upon the number or identity of this Corporation's shareholders,
to preserve exemptions under federal or state security laws, or
for any other reasonable purpose.
Section 9.4 The provisions of this Article shall extend to and
be binding upon this Corporation, its successors and assigns, and
to all shareholders, their personal representatives, heirs,
legatees, and assigns.
KNOW ALL MEN BY THESE PRESENTS: That we, the undersigned, being
the Directors of Company 2.Com, Inc., do hereby consent to the
foregoing By-Laws and adopt the same as and for the By-Laws of
Company 2.Com, Inc. IN WITNESS WHEREOF, we have hereunto set our
hands this 26th day of October, 1999.
<TABLE>
<S> <C>
/s Daniel G. Chapman /s/ Sean P. Flanagan
Daniel G. Chapman, Director Sean P. Flanagan, Director
</TABLE>
<TABLE> <S> <C>
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<S> <C>
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