<PAGE>
U.S. Securities and Exchange Commission
Washington, D.C. 20549
---------------
Form 10-SB
---------------
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
Under Section 12(b) or 12(g) of the Securities Exchange Act of 1934
BOOK CORPORATION OF AMERICA
----------------------------
(Name of Small Business Issuer in its charter)
UTAH 87-0375228
- ---------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4894 Mt. Elbrus Drive, San Diego, California 92117
- --------------------------------------------- -----------
(Address of principal executive Offices) (Zip Code)
Issuer's telephone number: 619-565-1073
Securities to be registered under Section 12(b) of the Act:
None
Securities to be registered under Section 12(g) of the Act:
COMMON STOCK, $0.005 PAR VALUE
------------------------------
(Title of Class)
</Page>
<PAGE>
INFORMATION REQUIRED IN REGISTRATION STATEMENT
- ----------------------------------------------
This Form 10-SB contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995, which act
contains a safe harbor for forward looking statements. Statements made in
connection with initial public offerings, however, are not protected by the
safe harbor of the Private Securities Litigation Reform Act of 1995.
Nonetheless, the Company believes that investors would be benefitted by the
cautionary language included in this paragraph. For this purpose any
statements contained in this Form 10-SB that are not statements of
historical fact may be deemed to be forward-looking statements. Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate," or "continue" or comparable terminology are
intended to identify forward-looking statements. These statements by their
nature involve substantial risks and uncertainties, and actual results may
differ materially depending on a variety of factors, many of which are not
within the Company's control. These factors include but are not limited to
economic conditions generally and in the industries in which the Company
may participate; competition within the Company's chosen industry,
including competition from much larger competitors; technological advances
and failure by the Company to successfully develop business relationships.
PART I
Item 1. Description of Business
- ------- -----------------------
The Company was incorporated under the laws of the State of Utah on
November 22, 1978 for the purpose of (1) engaging primarily in the
specific business of acquiring, developing, owning, selling, leasing,
licensing, exploiting, and otherwise dealing with literary properties and
materials, copyrights, licenses, and other tangible and intangible
properties in connection with artistic ideas and endeavors, and to carry on
a negotiation for, production of, purchase of, sale, licensing,
distribution, advertising, and promotion of all rights, privileges, and
properties in the entertainment industry, including, but not limited to,
all types of theatrical motion pictures, theatrical stage plays, television
films, programs and commercials, radio recordings, books, and music
publications and music recordings and (2) acting as principal, agent, joint
venturer, partner, or in any other capacity which may be authorized or
approved by the Board of Directors of the Company. The Company has no
"parents" or "predecessors," as those terms are defined under the federal
securities laws.
In 1979 the Company conducted an intrastate public offering of its
common stock. On October 10, 1988, the common stock of the Company was
reverse split 50 to 1, and the par value was changed from $0.01 to $.005
per share. Also in October 1988, the Company acquired Sun Television
Entertainment, Inc., bringing assets of 36 motion picture screenplays
(subsequently valued at $-0-) and motion picture production equipment was
transferred to the Company by Visto International, Inc.
Since its inception the Company has sustained continued losses and
currently has liabilities in excess of current assets. In addition, the
Company has no revenue producing activities and is dependent upon its
officers to provide for its cash requirements. These factors indicate
considerable doubt as to the Company's ability to continue as a going
concern. To date the Company has been unsuccessful in its efforts to
develop its entertainment business.
2
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<PAGE>
Therefore, the Company intends to seek, investigate, and if warranted,
acquire an interest in a business opportunity. The Company proposes to
seek a business opportunity within the entertainment industry. The Company
has unrestricted discretion in seeking and participating in a business
opportunity, subject to the availability of such opportunities, economic
conditions and other factors.
The selection of a business opportunity in which to participate is
complex and extremely risky and will be made by management in the exercise
of its business judgment. There is no assurance that the Company will be
able to identify and acquire any business opportunity which will ultimately
prove to be beneficial to the Company and its shareholders.
The risks inherent in seeking a business interest are further
complicated as a result of the fact that the Company is a dormant company,
holds limited resources and is unable to provide a prospective business
opportunity with capital.
The Company's limited resources include property and equipment that
have been completely depreciated. In addition, the Company has been unable
to market its films which are now more than twenty-five years old. The
Company does not anticipate any future market developing for the films, and
subsequently, in October 1999 the value of the films were written down to
$-0- for each film. Because the Company's resources are limited to
depreciated and unmarketable property, the company's ability to acquire a
business opportunity with the entertainment industry may be affected.
Sources of Opportunities
- ------------------------
It is anticipated that business opportunities may be available to the
Company from various sources, including its officers and directors,
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 will rely principally on personal contacts of its officers and
directors as well as indirect associations between them and other
businesses and professional people. Although the Company does not
anticipate engaging professional firms specializing in business
acquisitions or reorganizations, if management deems it in the best
interest of the Company, such firms may be retained. In some instances,
the Company may publish notices or advertisements seeking a potential
business opportunity in financial or trade publications.
3
</Page>
<PAGE>
Criteria
- --------
The Company intends to focus its search for prospective business
opportunities to the area of entertainment. However, should other
opportunities become available, the Company may also consider
opportunities outside the entertainment industry based on criteria outlined
below.
In analyzing prospective business opportunities, management will
consider such matters as the available technical, financial and managerial
resources; working capital and other financial requirements; the history of
operations; prospects for the future; the nature of present and expected
competition; the quality and experience of management services which may be
available and the depth of the management; the potential for success of the
opportunity; the potential for growth and expansion; the potential for
profit; and other relevant factors.
To a large extent, a decision to participate in a specific business
opportunity may be made upon management's analysis of the quality of the
other firm's management and personnel, the ability to market products, and
numerous other factors which are difficult if not impossible to analyze
through the application of any objective criteria. In many instances, it
is anticipated that the results of operations of a specific firm may not
necessarily be indicative of the potential for the future because of the
requirement to substantially augment management, or other factors.
Generally, the Company will analyze all factors in the circumstances
and make a determination based upon a composite of available facts, without
reliance upon any single fact as controlling.
Methods of Participation of Acquisition
- ---------------------------------------
Specific business opportunities will be reviewed and on the basis of
that review the legal structure or method of participation deemed by
management to be suitable will be selected. The Company may consider
structures and methods such as leases, purchase and sale agreements,
licenses, joint ventures, or other contractual arrangements and may involve
a reorganization, merger or consolidation transaction. The Company may act
directly or indirectly through an interest in a partnership, corporation,
or other form of organization.
Procedures
- ----------
As part of the Company's investigation of business opportunities,
officers and directors may meet personally with management and key
personnel of the firm sponsoring the business opportunity, visit and
inspect material facilities, obtain independent analysis or verification of
certain information provided, check references of management and key
personnel, and conduct other reasonable measures.
The Company will generally request that it be provided with written
materials regarding the business opportunity containing such items as: a
description of product, service and company history; management resumes;
financial information; available projections with related assumptions upon
which they are based; and explanation of proprietary products and services;
present and proposed forms of compensation to management; a description of
transactions between the prospective entity and its affiliates; relevant
analysis of risks and competitive conditions; a financial plan of operation
and estimated capital requirements; and other information deemed relevant.
4
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<PAGE>
Competition
- -----------
The Company expects to encounter substantial competition in its
efforts to acquire a business opportunity. The primary competition is from
other companies, organized and funded for similar purposes, small venture
capital partnerships and corporations, small business investment companies
and wealthy individuals who are interested in a business opportunity. Many
of these companies and groups have substantial financial and personal
resources which give such companies considerable advantage over the
Company.
Employees
- ---------
The Company does not currently have any employees but relies upon the
efforts of its officers and directors to conduct the business of the
Company.
Reports to Security Holders
- ---------------------------
Prior to filing of the registration statement on Form 10-SB, the
Company was not subject to the reporting requirements of Section 13(a) or
15(d) of the Exchange Act. Upon effectiveness of this registration
statement, the Company will file annual and quarterly reports with the
Securities and Exchange Commission ("SEC"). The public may read and copy
materials filed by the Company with the SEC at the SEC's Public Reference
Room at 450 Fifth Street, N.W., Washington, D.C. 20549. The public may
obtain information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. The Company is an electronic filer and the SEC
maintains an Internet site that contains reports and other information
regarding the Company which may be viewed at http://www.sec.gov.
Item 2. Plan of Operations
- ------- ------------------
The Company has no cash on hand and has experienced losses from
inception. As of October 31, 1999, the Company had liabilities amounting
to $12,593. The Company has no material commitments for capital
expenditures for the next twelve months.
Should a business opportunity become available to the Company, the
Company's management may seek to raise additional capital by investment
from outsiders in the Company's common stock.
5
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<PAGE>
Item 3. Description of Property
- ------- -----------------------
The Company owns filming equipment, including a filming truck,
cameras, lights, editing equipment, and other equipment valued at a total
depreciated value of $-0-.
The Company holds nine films in its inventory for licensing or market
exploitation. These films have been valued at historical cost of
$2,407,000. In 1999, the films were revalued to $-0- because the Company
was unable to market them.
Additionally, the Company owns 412 NTSC 3/4 inch format master video
cassettes. These cassettes were valued at a historical cost of $40,000,
and have been revalued to a nominal $-0- amount.
The Company holds the motion picture rights to thirty-six screen
plays, three novels, two short stories and fifty story titles and synopses.
These rights and screen plays have no current net asset value.
Item 4. Security Ownership of Certain Beneficial Owners and Management:
Change in Control.
- ------- ----------------------------------------------------------------
The following table sets forth as of April 1, 2000, the name and the
number of shares of the Registrant's Common Stock, par value of $0.005 per
share, held of record or beneficially by each person who held of record, or
was known by the Registrant to own beneficially, more than 5% of the
2,349,540 issued and outstanding shares of the Company's Common Stock, and
the name and shareholdings of each director and of all officers and
directors as group.
<TABLE>
<CAPTION>
Title of Name and Address of Amount and Nature of
Class Beneficial Owner Beneficial Ownership (2) Percentage of Class
- ---------- --------------------- -------------------------- --------------------
<S> <C> <C> <C>
Common Philip Yordan (1,3) 1,000,000 42.56%
4894 Mt. Elbrus
San Diego, CA 92117
Common William Messerli (1) 1,000,000 42.56%
1800-5th St. Towers
150 S. 5th St.
Minneapolis, MN 55402
Common Daniel Yordan (1) 0 0%
4894 Mt. Elbrus
San Diego, CA 92117
- -------------------------------------------------------------------------------------
Officers, Directors and
Nominees as a Group: 2,000,000 85.12%
(3 people)
- -------------------------------------------------------------------------------------
</TABLE>
6
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<PAGE>
(1) Officer and/or director of the Company.
(2) The term "beneficial owner" refers to both the power of investment (the
right to buy and sell) and rights of ownership (the right to receive
distributions from the Company and proceeds from sales of shares).
Inasmuch as these rights or shares may be held by more than one person,
each person who has a beneficial ownership interest in shares is deemed the
beneficial owners of the same shares because there is share power of
investment or share rights of ownership.
(3) The shares attributed to Philip Yordan are held in the name of Philip
Yordan Productions, Inc., a company in which Mr. Yordan is the owner.
There are no contracts or other arrangements that could result in a
change of control of the Company.
Item 5. Directors, Executive Officers, Promoters and Control Persons.
- ------- -------------------------------------------------------------
The following table sets forth the name, age and position of each
executive officer and director and the term of office of each director of
the Corporation.
<TABLE>
<CAPTION>
NAME AGE POSITION DIRECTOR OR OFFICER SINCE
- ------------------ -------- --------------------- ---------------------------
<S> <C> <C> <C>
William Messerli 67 President & Director October 10, 1988
Philip Yordan 86 Treasurer & Chairman November 22, 1978
of the Board of
Directors
Daniel A. Yordan 51 Secretary November 22, 1978
</TABLE>
Each director serves for a period of one year or until his successor
is duly elected and qualified. Officers serve at the will of the Board of
Directors.
William Messerli. President and Director.
----------------- -----------------------
Mr. Messerli's background includes a successful career in the fields
of business, law, and finance. Mr. Messerli did his undergraduate work at
the University of Minnesota graduating in 1959 with a B.S. in Business
Administration. Mr. Messerli continued his education at the William
Mitchell College of Law, St. Paul, Minnesota and received his Juris
Doctorate in 1965. He is the founder and senior shareholder of Messerli &
Kramer, a 50 lawyer general practice Minneapolis law firm specializing in
legislative, tax and corporate matters, in which he was the managing
partner for 30 years. In 1975 he founded and is currently a Director and
majority stockholder of Burgundy Properties, Inc., a real estate brokerage
company specializing in the acquisition and syndication of apartment
complexes in the upper Midwest. For the last five years Mr. Messerli has
been principally engaged in the private practice of law with Messerli &
Kramer, P.A., and engaged in real estate activities via Burgundy
Properties, Inc. to a limited extent. He also has other business interests
and has served on various boards of directors.
7
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<PAGE>
Philip Yordan. Treasurer & Chairman of the Board of Directors.
-------------- -----------------------------------------------
Mr. Yordan is an internationally known and respected writer and
producer for more than forty years and has devoted himself to being a
playwright, novelist, motion picture producer and screen writer. He has
been nominated three times by the Academy of Motion Picture Arts and
Sciences, winning an Academy Award Oscar in 1954 for the film "Broken
Lance" starring Spencer Tracy. Mr. Yordan graduated from Kent College of
Law, Chicago, Illinois in 1936 and passed the Illinois State Bar in 1937.
He later became a Professor of Dramatic Arts at San Diego State University
from 1975 to 1980. Mr. Yordan authored the play, "Anna Lucasta" which
played for three years on Broadway from 1944 to 1947. In addition, Mr.
Yordan has been instrumental in creating many famous films including some
of the most successful epic motion pictures ever produced. Such films as:
"Battle of the Bulge," "King of Kings," "Custer of the West," "El Cid,"
"Man from Laramie," "Fall of the Roman Empire," "Fifty-five Days in
Peking," "Circus World," "The Harder They Fall," "The Bravados," "Broken
Lance," "Naked Jungle," "God's Little Acre," "Anna Lucasta," "No Down
Payment," "Blowing Wild," "The Chase," "Houdini," "Johnny Guitar," "Studs
Lonigan," "The Day of the Outlaw," "The Last Frontier," "Detective Story"
and "The Unholy." Mr. Yordan is also the President and Director of security
Film Productions, Inc. and Westland Resources, Inc.
Daniel A. Yordan. Secretary & Director.
----------------- ---------------------
Mr. Yordan graduated from Gonzaga University with a Bachelors of Art
in 1969. He later became a member of the American Society of Composers,
Authors and Publishers in 1973. From 1995 to 1999 Mr. Yordan was a
research associate at Aquasearch, Inc. and from 1999 to the present he has
been a manufacturer's representative for the same company.
To the knowledge of management, during the past five years, no present
or former director, executive officer or person nominated to become a
director or an executive officer of the Company:
(1) filed a petition under the federal bankruptcy laws or any state
insolvency law, nor had a receiver, fiscal agent or similar
officer appointed by a court for the business or property of such
person, or any partnership in which he was a general partner at
or within two years before the time of such filing, or any
corporation or business association of which he was an executive
officer at or within two years before the time of such filing;
(2) was convicted in a criminal proceeding or named subject of a
pending criminal proceeding (excluding traffic violations or
other minor offenses);
8
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<PAGE>
(3) was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining him
from or otherwise limiting, the following activities;
(i) acting as a futures commission merchant, introducing broker,
commodity trading advisor, commodity pool operator, floor broker,
leverage transaction merchant, associated person of any of the
foregoing, or as an investment advisor, underwriter, broker or
dealer in securities, or as an affiliate person, director or
employee of any investment company, or engaging in or continuing
any conduct or practice in connection with such activity;
(ii) engaging in any type of business practice; or
(iii) engaging in any activity in connection with the purchase
or sale of any security or commodity or in connection with any
violation of federal or state securities laws or federal
commodities laws;
(4) was the subject of any order, judgment, or decree, not
subsequently reversed, suspended, or vacated, of any federal or
state authority barring, suspending, or otherwise limiting for
more than 60 days the right of such person to engage in any
activity described above under this Item, or to be associated
with persons engaged in any such activity;
(5) was found by a court of competent jurisdiction in a civil action
or by the Securities and Exchange Commission to have violated any
federal or state securities law, and the judgment in such civil
action or finding by the Securities and Exchange Commission has
not been subsequently reversed, suspended, or vacated
(6) was found by a court of competent jurisdiction in a civil action
or by the Commodity Futures Trading Commission to have violated
any federal commodities law, and the judgment in such civil
action or finding by the Commodity Futures Trading Commission has
not been subsequently reversed, suspended or vacated.
Item 6. Executive Compensation.
- ------- -----------------------
The following chart sets forth certain summary information concerning
the compensation paid or accrued for each of the Registrant's last three
completed fiscal years to the Registrant's or its principal subsidiaries'
chief executive officers and each of its other executive officers that
received compensation in excess of $100,000 during such period (as
determined at October 31, 1999, the end of the Registrant's last completed
fiscal year).
9
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<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long Term Compensation
Other Awards Payouts All
Name and Annual Compensation Annual Restricted Other
Principal Bonus Compen Stock Options LTIP Compen-
Position Year Salary $ -sation Awards /SARs Payout sation
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
William Messerli 1999 -0- -0- -0- -0- -0- -0-
-0-
President & 1998 -0- -0- -0- -0- -0- -0- -0-
Director 1997 -0- -0- -0- -0- -0- -0- -0-
Philip Yordan 1999 -0- -0- -0- -0- -0- -0- -0-
Treasurer & 1998 -0- -0- -0- -0- -0- -0- -0-
Chairman of the 1997 -0- -0- -0- -0- -0- -0- -0-
Board of Directors
Philip Yordan, Jr. 1999 -0- -0- -0- -0- -0- -0- -0-
Secretary & Director 1998 -0- -0- -0- -0- -0- -0- -0-
1997 -0- -0- -0- -0- -0- -0- -0-
</TABLE>
Compensation of Directors
- -------------------------
None.
Employment Contracts and Termination of Employment and Change in Control
Arrangements.
- -------------------------------------------------------------------------
There are no employment contracts between the Company and any of its
Officers or Directors.
There are no compensatory plans or arrangements, including payments to
be received from the Company, with respect to any person named in Cash
Compensation set out above which would in any way result in payments to any
such person because of his resignation, retirement, or other termination of
such person's employment with the Company or its subsidiaries, or any
change in control of the Company, or a change in the person's
responsibilities following a change in control of the Company.
The Company has no retirement, pension, profit-sharing, insurance, or
medical reimbursement plan covering its officers and directors, and does
not contemplate implementing any such plan at this time. None of the
Officers or directors of the Company has any options or warrants to
purchase shares of the Company's common stock.
10
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<PAGE>
Item 7. Certain Relationships and Related Transactions.
- ------- -----------------------------------------------
In 1993 the Company's principal shareholders contributed nine films to
the Company for licensing and distribution. Additionally, Mr. Messerli
contributed 412 NTSC 3/4 inch format master video cassettes. No
compensation was awarded for either contribution.
In 1988, the Company acquired $200,000 worth of motion picture
production equipment from Visto International, Inc. in exchange for 200,000
shares of the Company's common stock. The equipment was purchased with
common stock of the Company, which was donated to the Company by Philip
Yordan. Visto International, Inc., is a privately held corporation of
which William Messerli is an officer, director and sole shareholder.
Daniel Yordan is the son of Philip Yordan.
Item 8. Description of Securities
- ------- -------------------------
The Company is presently authorized to issue 100,000,000 shares of
$0.005 par value Common Stock. All shares when issued, will be fully paid
and non-assessable. All shares are equal to each other with respect to
liquidation and dividend rights. Holders of voting shares are entitled to
one vote for each share they own at any Shareholders' meeting.
Holders of Shares of Common Stock are entitled to receive such
dividends as may be declared by the Board of Directors out of funds
legally available therefor, and upon liquidation are entitled to
participate pro-rata in a distribution of assets available for such a
distribution to Shareholders. There are no conversion, pre-emptive or
other subscription rights or privileges with respect to any shares.
Reference is made to the Company's Articles of Incorporation and its
Bylaws for a more complete description of the rights and liabilities of
holders of Common Stock. The Company does not have cumulative voting rights
which means that the holders of more the 50% of the Shares voting for each
election of directors may elect all of the directors if they choose to do
so. In such event, the holders of the remaining Shares aggregating less
than 50% will not be able to elect any directors.
The Company will furnish annual reports to its shareholders which will
include financial statements and other interim reports as Management deems
appropriate.
The Company has appointed Fidelity Transfer Company, 1801 S. West
Temple, Salt Lake City, Utah 84115, as the transfer agents and registrar
for the Company's securities.
11
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<PAGE>
PART II
Item 1. Market Price of and Dividends on the company's Common Equity and
Other Shareholder Matters.
- ------- ----------------------------------------------------------------
The Company's common stock is not currently publicly traded. The
Company currently has 247 stockholders and 2,349,540 shares issued and
outstanding. The Company has not paid, nor declared, any dividends since
its inception and does not intend to declare any such dividends in the
foreseeable future. The Company's ability to pay dividends is subject to
limitations imposed by Utah Law.
Item 2. Legal Proceedings.
- ------- ------------------
No legal proceedings are threatened or pending against the Company or
any of its officers or directors. Further, none of the Company's officers
or directors or affiliates of the Company are parties against the Company
or have any material interests in actions that are adverse to the Company's
interests.
Item 3. Changes in and Disagreements with Accountants
- ------- ---------------------------------------------
None.
Item 4. Recent Sales of Unregistered Securities.
- ------- ----------------------------------------
None.
Item 5. Indemnification of Directors and Officers
- ------- -----------------------------------------
The Articles of Incorporation of Book Corporation of America provide
for indemnification of directors and officers as follows:
The Corporation shall indemnify any and all persons who may serve
at any time as directors or officers or who at the request of the
board of Directors of the Corporation may serve or at any time have
served as directors or officers of another corporation in which the
Corporation at such time owned or may own shares of stock or of which
it was or may be a creditor, and their respective heirs,
administrators, successors, and assignees, against any and all
expenses, including amounts paid upon judgments, counsel fees and
amounts paid in settlement (before or after suit is commenced),
actually and necessarily incurred by such persons in connection with
the defense or settlement of any claim, action, suit or proceeding in
which they, or any of them are made parties, or a party, or which may
be asserted against them or any of them, by reason of having been
directors or officers or a director or officers or a director or
officer of the Corporation, or such other corporation, except in
relation to matters as to which any such director or officer or former
director or officer or person shall be adjudged in any action, suit or
proceeding to be liable for his own negligence or misconduct in the
performance or his duty. Such indemnification shall be in addition to
any other rights to which those indemnified may be entitled under any
law, bylaw, agreement, vote of shareholders or otherwise.
12
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<PAGE>
The Bylaws of Book Corporation of America provide for indemnification
of directors and officers as follows:
No officer or director shall be personally liable for any
obligations arising out of any acts or conduct of said officer or
director performed for or on behalf of the Corporation. The
corporation shall and does hereby indemnify and hold harmless each
person and his heirs and administrators who shall serve at any time
hereafter as a director or officer of the Corporation from and against
any and all claims, judgments and liabilities to which such persons
shall become subject by reason of any action alleged to have been
heretofore or hereafter taken or omitted to have been taken by him as
such director or officer, and shall reimburse each such person for all
legal and other expenses reasonably incurred by him in connection with
any such claim or liability; including power to defend such person
from all suits as provided for under the provisions of the Utah
Corporation Laws; provided, however that no such person shall be
indemnified against, or be reimbursed for, any expense incurred in
connection with any claim or liability arising out of his own
negligence or willful misconduct. The rights accruing to any person
under the foregoing provisions of this section shall not exclude any
other right to which he may lawfully be entitled, nor shall anything
herein contained restrict the right of the Corporation to indemnify or
reimburse such person in any proper case, even though not specifically
herein provide for. The Corporation, its directors, officers,
employees and agents shall be fully protected in taking any action or
making any payment or in refusing so to do in reliance upon the advice
of counsel.
The Company and its affiliates may not be liable to its shareholders
for errors in judgment or other acts or omissions not amounting to willful
misconduct or gross negligence, since the Utah Business Corporation Act
permits indemnification of the officers and directors of a corporation in
most cases for any liability suffered by them or arising out of their
activities as officers and directors of the corporation if they acted in
good faith and in a manner they reasonably believed to be in or not opposed
to the best interest of the corporation.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to officers and directors of the
Company pursuant to the provisions of the Company's Certificate of
Incorporation, the Company has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is therefore
unenforceable.
13
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<PAGE>
PART F/S
BOOK CORPORATION OF AMERICA
(A Development Stage Company)
INDEX TO FINANCIAL STATEMENTS
Report of Independent Accountants
Balance Sheets for the Fiscal Years Ended October 31, 1999, 1998, and 1997
Statement of Operations Accumulated for the Period November 22, 1978
(inception to October 31, 1999 & For the Years Ended October 31, 1999,
1998, and 1997
Statements of Stockholders' Equity for the Period November 22, 1978
(inception) to October 31, 1999
Statements of Cash Flows Accumulated for the Period November 22, 1978
(Inception) to October 31, 1999 & for the Years Ended October 31, 1999,
1998, & 1997
Notes to the Financial Statements
PART III
Item 1. Index and Description of Exhibits.
- ------- ----------------------------------
<TABLE>
<CAPTION>
Exhibit
Number Title of Document Location
- ----------- ------------------------------------- ------------
<S> <C> <C>
2.01 Articles of Incorporation . . . . . . . . . . . See Attached
2.02 Amended Articles of . . . . . . . . . . . . . . See Attached
Incorporation
2.03 Bylaws. . . . . . . . . . . . . . . . . . . . . See Attached
23 Consent of Auditor. . . . . . . . . . . . . . . See Attached
27.01 Financial Data Schedule . . . . . . . . . . . . See Attached
</TABLE>
14
</Page>
<PAGE>
- --------------------------------------------------------------------------
SIGNATURES
- --------------------------------------------------------------------------
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its
behalf, thereunto duly authorized.
Book Corporation of America
Date: May 8, 2000 By: /s/ William Messerli
-------------------------
President
Date: May 8, 2000 By: /s/ Philip Yordan
-------------------------
Treasurer
15
</Page>
<PAGE>
- --------------------------------------------------------------------------
SIGNATURES
- --------------------------------------------------------------------------
In accordance with Section 12 of the Securities Exchange Act of 1934,
the registrant caused this registration statement to be signed on its
behalf, thereunto duly authorized.
Book Corporation of America
Date: May 8, 2000 By:
-------------------------
President
Date: May 8, 2000 By:
-------------------------
Treasurer
15
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Financial Statements
October 31, 1999, 1998 and 1997
</Page>
<PAGE>
[Letterhead]
Independent Auditors Report
Board of Directors
Book Corporation of America
(A Development Stage Company)
I have audited the accompanying balance sheets of Book Corporation of
America, as of October 31, 1999, 1998 and 1997, and the related statements
of operations, stockholders' equity, and cash flows for the years ended
October 31, 1999, 1998 and 1997 and accumulated for the period November 22,
1978 (Inception Date) to October 31, 1999. These financial statements are
the responsibility of the Company's management. My responsibility is to
express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatements. 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 the significant estimates made by management, as well as
evaluating the overall financial statements presentation. I believe that
my audit provides a reasonable basis for my opinion.
In my opinion, the aforementioned financial statements present fairly, in
all material respects, the financial position of Book Corporation of
America, as of October 31, 1999, 1998 and 1997, and the results of its
operations and its cash flows for the years ended October 31, 1999, 1998
and 1997, and accumulated for the period November 22, 1978, (Inception
Date) to October 31, 1999, in conformity with generally accepted accounting
principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note #7 to the
financial statements, the Company has an accumulated deficit and a negative
net worth at October 31, 1999. These factors raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans
in regard to these matters are also discussed in Note #7. The financial
statements do not include any adjustments that might result from the
outcome of this uncertainty.
/S/ Schvaneveldt & Company
Salt Lake City, Utah
March 16, 2000
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Balance Sheets
For the Fiscal Years Ended October 31, 1999, 1998, and 1997
<TABLE>
<CAPTION>
October October October
31, 1999 31, 1998 31, 1997
---------- ---------- ----------
<S> <C> <C> <C>
Assets
Current Assets $ -0- $ -0- $ -0-
- --------------
Property & Equipment
- --------------------
Production Equipment Net -0- 4,215 10,731
Other Assets
- ------------
Master Video Cassettes -0- 3,000 3,000
Films -0- 27,000 27,000
---------- ---------- ----------
Total Other Assets -0- 30,000 30,000
---------- ---------- ----------
Total Assets $ -0- $ 34,215 $ 40,731
========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements
F-3
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Balance Sheets -Continued-
For the Fiscal Years Ended October 31, 1999, 1998, and 1997
<TABLE>
<CAPTION>
October October October
31, 1999 31, 1998 31, 1997
----------- ----------- -----------
<S> <C> <C> <C>
Liabilities & Stockholders' Equity
Current Liabilities
- -------------------
Accounts Payable $ 12,593 $ 10,693 $ 9,792
Stockholders' Equity
- --------------------
Common Shares 100,000,000 Authorized;
$0.005 Par Value 2,349,540 Shares
Issued & Outstanding 11,745 11,748 11,748
Paid In Capital 3,041,711 3,041,711 3,038,711
Accumulated Deficit (3,066,052) ( 3,029,937) (3,019,520)
----------- ----------- -----------
Total Stockholders' Equity ( 12,593) 23,522 30,939
----------- ----------- -----------
Total Liabilities &
Stockholders' Equity $ -0- $ 34,215 $ 40,731
=========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements
F-4
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Statements of Operations
Accumulated for the Period November 22, 1978 (Inception)
to October 31, 1999 &
For the Years Ended October 31, 1999, 1998 and 1997
<TABLE>
<CAPTION>
October October October
Accumulated 31, 1999 31, 1998 31, 1997
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues $ 250,000 $ -0- $ -0- $ -0-
- --------
Expenses
- --------
Administrative Expenses 18,516 1,900 3,901 100
Depreciation 200,000 4,215 6,516 8,688
Production Costs 132,448 -0- -0- -0-
Write Down of Film Inventory 2,563,500 -0- -0- -0-
Write Off of Investments &
Other Assets 195,671 30,000 -0- -0-
Bad Debt 200,000 -0- -0- -0-
Failed Offering Costs 5,917 -0- -0- -0-
------------ ------------ ------------ ------------
Total Expenses 3,316,052 36,115 10,417 8,788
------------ ------------ ------------ ------------
Net Loss ($ 3,066,052) ($ 36,115) ($ 10,417) ($ 8,788)
============ ============ ============ ============
Loss Per Share Weighted
Average Shares ($ 0.01) ($ 0.01) ($ 0.01)
Shares Outstanding 2,349,540 2,349,540 2,349,540
</TABLE>
The accompanying notes are an integral part of these financial statements
F-5
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Statements of Stockholders' Equity
For the Period November 22, 1978 (Inception) to October 31, 1999
<TABLE>
<CAPTION>
Common Stock Paid In Accumulated
Shares Amount Capital Deficit
-----------------------------------------------------
<S> <C> <C> <C> <C>
Balance, (Inception)
November 22, 1978 -0- $ -0- $ -0- $ -0-
Issues Shares for
Cash (Restated) 300,000 1,500 126,000 -0-
Issued Shares for
Literary Production
& Equipment 6,999,540 34,998 383,444 -0-
Net Losses Incurred
from Inception to
October 31, 1986 ( 442,609)
-----------------------------------------------------
Balance,
October 31, 1986 7,299,540 36,498 509,444 ( 442,609)
Net Loss for Year Ended
October 31, 1987 ( 6,666)
-----------------------------------------------------
Balance,
October 31, 1987 7,299,540 36,498 509,444 ( 449,275)
No Operations for
Year Ended
October 31, 1988
-----------------------------------------------------
Balance,
October 31, 1988 7,299,540 36,498 509,444 ( 449,275)
Capital
Contribution 55,917
Net Income for Year Ended
October 31, 1989 144,629
-----------------------------------------------------
Balance,
October 31, 1989 7,299,540 36,498 565,361 ( 304,646)
Shares Returned by
Shareholders for
Cancellation ( 4,950,000)( 24,750) 24,750
Net Loss for Year Ended
October 31, 1990 ( 217,129)
-----------------------------------------------------
Balance,
October 31, 1990 2,349,540 11,748 590,111 ( 521,775)
</TABLE>
The accompanying notes are an integral part of these financial statements
F-6
</Page>
<PAGE>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Statements of Stockholders' Equity -Continued-
For the Period November 22, 1978 (Inception) to October 31, 1999
<TABLE>
<CAPTION>
Common Stock Paid In Accumulated
Shares Amount Capital Deficit
-----------------------------------------------------
<S> <C> <C> <C> <C>
Net Loss for Year Ended
October 31, 1991 ( 11,224)
-----------------------------------------------------
Balance,
October 31, 1991 2,349,540 11,748 590,111 ( 532,999)
Net Loss for Year Ended
October 31, 1992 ( 11,236)
-----------------------------------------------------
Balance,
October 31, 1992 2,349,540 11,748 590,111 ( 544,235)
Net Loss for Year Ended
October 31, 1993 ( 11,248)
-----------------------------------------------------
Balance,
October 31, 1993 2,349,540 11,748 590,111 ( 555,483)
Paid In Capital for
Contributed Assets 2,447,000
Net Loss for Year Ended
October 31, 1994 ( 10,390)
-----------------------------------------------------
Balance,
October 31, 1994 2,349,540 11,748 3,037,111 ( 565,873)
Net Loss for Year Ended
October 31, 1995 ( 10,262)
-----------------------------------------------------
Balance,
October 31, 1995 2,349,540 11,748 3,037,111 ( 576,135)
Contributed Capital 1,600
Net Loss for Year Ended
October 31, 1996 ( 2,434,597)
-----------------------------------------------------
Balance,
October 31, 1996 2,349,540 11,748 3,038,711 ( 3,010,732)
Net Loss for Year Ended
October 31, 1997 ( 8,788)
-----------------------------------------------------
Balance,
October 31, 1997 2,349,540 11,748 3,038,711 ( 3,019,520)
</TABLE>
The accompanying notes are an integral part of these financial statements
F-7
</Page>
<PAGE>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Statements of Stockholders' Equity -Continued-
For the Period November 22, 1978 (Inception) to October 31, 1999
<TABLE>
<CAPTION>
Common Stock Paid In Accumulated
Shares Amount Capital Deficit
-----------------------------------------------------
<S> <C> <C> <C> <C>
Contributed Capital 3,000
Net Loss for Period Ended
October 31, 1998 ( 10,417)
-----------------------------------------------------
Balance, October 31, 1998 2,349,540 11,748 3,041,711 ( 3,029,937)
Net Loss for the Year Ended
October 31, 1999 ( 36,115)
-----------------------------------------------------
Balance, October 31, 1999 2,349,540 $ 11,748 $ 3,041,711 ($3,066,052)
=====================================================
</TABLE>
The accompanying notes are an integral part of these financial statements
F-8
</Page>
<PAGE>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Statements of Cash Flows
Accumulated for the Period November 22, 1978 (Inception) to
October 31, 1999 &
for the Years Ended October 31, 1999, 1998 & 1997
<TABLE>
<CAPTION>
Accumulated 1999 1998 1997
------------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
Cash Flows from
Operating Activities
- --------------------
Net Loss ($ 3,066,052) ($ 36,115) ($ 10,417) ($ 8,788)
Adjustments to Reconcile Net
Loss to Net Cash Used by
Operating Activities;
Depreciation 200,000 4,215 6,516 8,688
Noncash Transactions;
Write Down of Film Inventory 2,593,500 30,000 -0- -0-
Changes in Operating Assets &
Liabilities;
Increase in Accounts Payable 12,593 1,900 901 100
------------- ------------ ------------ ------------
Net Cash Used by Operating
Activities ( 259,959) -0- ( 3,000) -0-
Cash Flows from
Investing Activities -0- -0- -0- -0-
- -------------------- ------------- ------------ ------------ ------------
Cash Flows from
Financing Activities
- --------------------
Proceeds from the Sale of
Common Stock 127,500 -0- -0- -0-
Contributed Capital 60,517 -0- 3,000 -0-
Debt to Equity Conversion 71,942 -0- -0- -0-
------------- ------------ ------------ ------------
Net Cash Provided by
Financing Activities 259,959 -0- 3,000 -0-
------------- ------------ ------------ ------------
Increase (Decrease) in Cash -0- -0- -0- -0-
Cash at Beginning of Period -0- -0- -0- -0-
------------- ------------ ------------ ------------
Cash at End of Period $ -0- $ -0- $ -0- $ -0-
============= ============ ============ ============
Disclosure of Significant
Operating Activities:
- -------------------------
Interest $ -0- $ -0- $ -0- $ -0-
Taxes -0- -0- -0- -0-
Significant Noncash Transactions:
- ---------------------------------
Acquisition of Films and Videos
Cassette as Contributed Capital 2,447,000
Acquisition of Property &
Equipment 200,000
</TABLE>
The accompanying notes are an integral part of these financial statements
F-9
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Notes to Financial Statements
NOTE #1 - Organization
- ----------------------
The Company was incorporated under the laws of the state of Utah on
November 22, 1978. The Company amended its Articles of Incorporation,
authorizing 100,000,000 shares of common stock having a par value of $0.005
per share.
The Articles of Incorporation grants the Company unlimited power to engage
in and to do any lawful act concerning any and all lawful businesses for
which corporations may be organized. The Company currently seeks to
license films to television and to engage in market-by-market exploitation
of the films it holds in its film inventory.
In accordance with FASB 7 the Company is considered to be a development
stage company.
NOTE #2 - Significant Accounting Policies
- -----------------------------------------
A. The Company uses the accrual method of accounting.
B. Revenues and directly related expenses are recognized in the period in
which the sales are finalized with customers.
C. The Company considers all short term, highly liquid investments, that
are readily convertible to known amounts within ninety days as cash
equivalents. The Company currently has no cash equivalents.
D. Basic Earnings Per Shares are computed by dividing income available to
common stockholders by the weighted average number of common shares
outstanding during the period. Diluted Earnings Per Share shall be
computed by including contingently issuable shares with the weighted
average shares outstanding during the period. When inclusion of the
contingently issuable shares would have an antidilutive effect upon
earnings per share no diluted earnings per share shall be presented.
E. As a licensor of films to television or other markets the Company
shall recognize revenues on the dates of the exhibition for both
percentage and flat fee engagements. Revenues from license agreements
that meet the requirements of FASB 53 shall be recognized when the
license period begins.
F. Costs to produce a film shall be capitalized as film costs inventory
and shall be amortized using the individual film forecast computation
method.
G. Operating expenses and all type of income are recognized in the period
in which the activities occur.
H. Depreciation: The cost of property and equipment is depreciated over
the estimated useful lives of the related assets. The cost of
leasehold improvements is amortized over the lesser of the length of
the lease of the related assets for the estimated lives of the assets.
Depreciation and amortization is computed on the straight line method.
F-10
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Notes to Financial Statements -Continued-
NOTE #3 - Non Cash Investing and Non Cash Financing Activities
- --------------------------------------------------------------
In 1988, the Company issued 200,000 shares of its common stock to a
related entity for assets valued at historical cost of $200,000.
The Company currently holds in its film inventory, films contributed to the
Company by principal stockholders. In the year ended October 31, 1999, the
Company wrote off 100% of the cost of these films, because it has not and
has no plans to aggressively market the films.
NOTE #4 - Public Stock Offering
- -------------------------------
In 1979, the Company conducted an intrastate public offering of its common
stock shares and issued 15,000,000 pre split, 300,000 post split shares for
net proceeds of $127,500.
NOTE #5 - Property & Equipment
- ------------------------------
The Company has assets as scheduled below. Assets are held in safekeeping
by the Company's Vice-President. Assets are depreciated over the estimated
useful life of the individual asset using the straight line method of
depreciation.
<TABLE>
<CAPTION>
Accumulated Depreciation
Cost 1999 1998 1997
-------------------------------------------
<S> <C> <C> <C> <C>
Filming Truck $ 20,000 $ 20,000 $ 20,000 $ 20,000
Cameras 109,600 109,600 107,739 103,629
Lights 38,000 38,000 36,191 34,766
Editing Equipment 6,300 6,300 6,300 6,300
Other Equipment 26,100 26,100 25,555 24,574
-------------------------------------------
Total $ 200,000 $ 200,000 $ 195,785 $ 189,269
===========================================
Total Depreciation Expenses 1999 1998 1997
--------------------------- -----------------------------
$ 4,215 $ 6,516 $ 8,688
</TABLE>
The accompanying notes are an integral part of these financial statements
F-11
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Notes to Financial Statements -Continued-
NOTE #6 - Income Taxes and Net Operating Loss Carryforwards
- -----------------------------------------------------------
The Company has incurred losses that can be carried forward to offset
future earnings if provisions of the Internal Revenue Codes are met. These
losses are as follows:
<TABLE>
<CAPTION>
Year of Loss Expiration
Loss Amount Date
------- ----------- -----------
<S> <C> <C>
1986 $ 151,480 2001
1987 6,666 2002
1988 -0-
1989 -0-
1990 217,129 2005
1991 11,224 2006
1992 11,236 2007
1993 11,248 2008
1994 10,390 2009
1995 10,262 2010
1996 17,597 2011
1997 8,788 2012
1998 10,417 2013
1999 36,115 2014
</TABLE>
The Company has adopted FASB 109 to account for income taxes. The Company
currently has no issues that create timing differences that would mandate
deferred tax expense. Net operating losses would create possible tax
assets in future years. Due to the uncertainty as to the utilization of
net operating loss carryforwards an evaluation allowance has been made to
the extent of any tax benefit that net operating losses may generate.
<TABLE>
<CAPTION>
1999 1998 1997
--------------------------------
<S> <C> <C> <C>
Current Tax Asset Value of Net Operating
Loss Carryforwards at Current Prevailing
Federal Tax Rate $ 170,999 $ 158,720 $ 155,387
Evaluation Allowance at 100%
Net Tax Assets ( 170,999) ( 158,720) ( 155,387)
--------------------------------
Current Income Tax Expenses $ -0- $ -0- $ -0-
Deferred Tax Expenses -0- -0- -0-
</TABLE>
F-12
</Page>
<PAGE>
Book Corporation of America
(A Development Stage Company)
Notes to Financial Statements -Continued-
NOTE #7 - Going Concern
- -----------------------
The Company has sustained continued losses and currently has liabilities in
excess of current assets. In addition, the Company has no revenue
producing activities and is dependent upon its officers to provide its cash
requirements. These factors indicate considerable doubt as to the
Company's ability to continue as a going concern.
The Company's management seeks to raise additional capital by additional
investment from outsiders in the Company's common stock.
NOTE #8 - Related Party Transactions
- ------------------------------------
The Company's principal shareholders contributed nine films to the Company
for licensing and distribution. These films have been valued at historical
cost or a discounted fair market value of $2,407,000. In 1999, the films
were revalued to $-0- each because the Company has been unable to market
them.
Additionally, the Company's President contributed 412 NTSC 3/4 inch format
master video cassettes. These cassettes were valued at a historical cost
of $40,000, and have been revalued to have no current value.
NOTE #9 - Motion Picture Rights and Screen Plays
- -------------------------------------------------
The Company holds the motion picture rights to thirty-six screen plays,
three novels, two short stories and fifty story titles and synopses. These
rights and screen plays have been recorded at net asset value to reflect
predecessor value and provisions of FASB 53 limiting such assets to a three
year life.
NOTE #10 - Films Inventory
- ---------------------------
The Company holds the following films in its inventory for licensing or
market exploitation.
<TABLE>
<CAPTION>
Fair Market
Value at
Historical Acquired Present
Films Cost Date Value
---------------------------------------------------------------------
<S> <C> <C> <C>
Beast Must Die $ 135,734 $ 135,734 $ -0-
Kiss From A Killer 282,980 282,980 -0-
Scream Your Head Off 554,491 300,000 -0-
Shiver 507,661 300,000 -0-
Sleeping With A Stranger 517,515 300,000 -0-
Savage Journey 376,756 188,266 -0-
Night Train To Terror 1,031,208 300,000 -0-
Legend of Big Foot 2,181,493 300,000 -0-
Bloody Wednesday 844,463 300,000 -0-
--------------------------------------
$ 6,432,301 $2,406,980 $ -0-
======================================
</TABLE>
F-13 </Page>
<PAGE>
EXHIBIT 2.01
ARTICLES OF INCORPORATION OF
BOOK CORPORATION OF AMERICA
</Page>
<PAGE>
ARTICLES OF INCORPORATION
--------------------------
OF
--
BOOK CORPORATION OF AMERICA
----------------------------
We, the undersigned natural persons of the age of 21 years or more,
acting as incorporators of a corporation under the Utah Business
Corporations Act adopt the following Articles of Incorporation for such
corporation:
ARTICLE I
----------
NAME. The name of the corporation is BOOK CORPORATION OF AMERICA.
ARTICLE II
----------
PERIOD OF DURATION. The duration period of the corporation is
perpetual.
ARTICLE III
-----------
PURPOSES AND POWERS. The corporation shall have unlimited power to
engage in and to do any lawful act concerning any and all lawful businesses
for which corporations may be organized, including but not limited to, the
following:
(a) To engage primarily in the specific business of acquiring,
developing, owning, selling, leasing, licensing, exploiting, and
otherwise dealing with literary properties and materials, copyrights,
licenses, and other tangible and intangible properties in connection
with artistic ideas and endeavors, and to carry on a negotiation for,
production of, purchase of, sale, licensing, distribution,
advertising, and promotion of all rights, privileges, and properties
in the entertainment industry, including, but not limited to, all
types of theatrical motion pictures, theatrical stage plays,
television films, programs and commercials, radio recordings, books,
and music publications and music recordings.
(b) To act as principal, agent, joint venturer, partner, or in any
other capacity which may be authorized or approved by the Board of
Directors of the corporation.
(c) To transact business in the State of Utah or in any other
jurisdiction in the United States of America or elsewhere in the
world.
ARTICLE IV
-----------
AUTHORIZED SHARES. The aggregate number of shares which the
corporation shall have authority to issue is two hundred million
(200,000,000) shares of common voting stock having a par value of one cent
($0.01) per share; said stock shall be non-assessable.
2
</Page>
<PAGE>
ARTICLE V
---------
PRE-EMPTIVE RIGHTS. No stockholder of the corporation shall,
because of his ownership of the stock, have any pre-emptive or other rights
to purchase, subscribe for, or take all or part of any stock or all or part
of any notes, debentures, bonds or securities convertable into or carrying
options for warrants to purchase stock of the corporation issued, optioned,
or sold by it after its incorporation. Such may be sold or disposed of by
the corporation pursuant to resolution of its Board of Directors to such
persons and upon such terms as may, to such Board of Directors, seem proper
without first offering such stock or securities or any part thereof to
existing stockholders.
ARTICLE VI
----------
COMMENCEMENT OF BUSINESS. The corporation shall not commence
business until at least one thousand dollars ($1,000.00) has been received
by the corporation as consideration for the issuance of shares.
ARTICLE VII
-----------
VOTING OF SHARES. Each outstanding share of the common stock of the
corporation shall be entitled to one vote on each matter submitted to a
vote at a meeting of the shareholders, each shareholder being entitled to
vote his or its shares in person or by proxy executed in writing by such
shareholder or by his duly authorized attorney-in-fact. At each election
for directors, every shareholder entitled to vote at such election shall
have the right to vote in person or by proxy the number of shares owned by
him or it for as many persons as there are directors to be elected and for
whose election he or it has a right to vote, but the shareholder shall have
no right whatsoever to accumulate his or its votes with regard to such
election.
ARTICLE VIII
-------------
INITIAL REGISTERED OFFICE AND INITIAL REGISTERED AGENT.
--------------------------------------------------------
SECTION ONE. Registered office. The address of the initial
registered office of the corporation is 245 North Center Street, Salt Lake
City, Utah 84103.
SECTION TWO. Registered Agent The name of the original registered
agent of the corporation at such address is Philip Yordan.
3
</Page>
<PAGE>
ARTICLE IX
-----------
DIRECTORS. The initial Board of Directors of the corporation shall
consist of three members, and their respective names and addresses are:
Name Address
Philip Yordan 245 North Center Street, Salt Lake City, Utah 84103
Edward McKay 959 East Hollywood Avenue, Salt Lake City, Utah 84105
Phill Catherall 911 North 100 East, American Fork, Utah 84003
Which directors shall hold office until the first meeting of
shareholders of the corporation, and at each annual meeting thereafter,
the shareholders shall elect directors to hold office until the next
succeeding annual meeting of the share holders. Each director so elected
shall hold office for the term of which he is elected and until his
successor shall have been elected and qualified. Directors need not be
residents of the State of Utah or shareholders of the corporation.
ARTICLE X
----------
INCORPORATORS. The name and address of each incorporator is:
Name Address
Philip Yordan 245 North Center Street, Salt Lake City, Utah 84103
Edward McKay 959 East Hollywood Avenue, Salt Lake City, Utah 84105
Phill Catherall 911 North 100 East, American Fork, Utah 84003
EXECUTED this 21st day of November, 1978.
By: /s/ Philip Yordan
---------------------------------
Philip Yordan
By: /s/ Edward McKay
---------------------------------
Edward McKay
By: /s/ Phil Catherall
---------------------------------
Phil Catherall
4
</Page>
<PAGE>
STATE OF UTAH
)
: ss.
COUNTY OF SALT LAKE
)
I, Jaquie Mckay, a Notary Public, hereby certify that on the 21st day
of November, 1978, personally appeared before me Philip Yordan, Edward
McKay, and Phill Catherall, who being by me first duly sworn, severally
declare that they are the persons who signed the foregoing document as
incorporators and that the statements therein contained are true.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 21ST day
of November, 1978.
By: /s/ Jaquie McKay
--------------------------------
NOTARY PUBLIC
Residing in Salt Lake City, Utah
My Commission Expires:
08-04-82
5
</Page>
<PAGE>
EXHIBIT 2.02
ARTICLES OF AMENDMENT TO
ARTICLES OF INCORPORATION OF
BOOK CORPORATION OF AMERICA
1
</Page>
<PAGE>
ARTICLES OF AMENDMENT
TO
ARTICLES OF INCORPORATION
OF
BOOK CORPORATION OF AMERICA
Book Corporation of America, a Utah corporation organized under the
laws of the State of Utah, November 22, 1978, hereby adopts the following
Articles of Amendment to its Articles of Incorporation pursuant to the
provisions of Utah Code Annotated, Section 16-10-54.
I
The Articles of Incorporation shall be amended to read as follows:
ARTICLE IV
AUTHORIZED SHARES The aggregate number of shares which the
Corporation shall have the authority to issue is 100,000,000 shares of
common voting stock having a par value of $.005 per share. When issued
said shares shall be fully paid and non-assessable.
II
The date of the adoption of the foregoing amendments by the shareholders
was October 10, 1988.
III
The number of shares outstanding in the Corporation is 114,997,000.
The number of shares entitled to vote on the amendment is 114,997,000.
All stock in the Corporation is entitled to one vote per share for each
matter coming before the meeting of the shareholders.
IV
The number of shares that voted in favor of the above amendments was
100,100,000. The number of shares that voted against the above
amendments was 0.
V
Pursuant to resolution duly adopted by the Board of Directors and by the
shareholders of the Corporation on October 10, 1988, the 114,997,000
outstanding shares of the Corporation were reverse split 50 to 1, leaving the
aggregate number of 2,299,940 common shares of $.005 par value issued and
outstanding in the Corporation with a stated capital of $11,497.70. The
Board of Directors and shareholders have also approved the issuance of an
additional 5,000,000 shares, raising the issued and outstanding shares of the
Corporation to 7,299,940, with a stated capital of $36,497.70.
2
</Page>
<PAGE>
DATED this 10th day of October, 1988.
BOOK CORPORATION OF AMERICA
By: /s/ Philip Yordan
-------------------------------------
Philip Yordan, President
Attest: By: /s/ Daniel Yordan
---------------------------
Daniel Yordan
3
</Page>
<PAGE>
STATE OF CALIFORNIA )
: ss
COUNTY OF SAN DIEGO )
I, Maria J. Da Luz, a Notary- Public, do hereby certify that on this
15th day of November 1988, personally appeared before me Philip Yordan, who
being duly sworn, declared that he is, respectively, the President and
Secretary of the Corporation, and that he signed the foregoing document as
President and Secretary, and that the statements contained therein are true.
IN WITNESS WHEREOF, I have hereunto set my hand this 15th day of
November, 1988.
By: /s/ Maria J. Da Luz
--------------------------------
NOTARY PUBLIC
Residing in:
My Commission Expires: 7-2-91
4
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EXHIBIT 2.03
BYLAWS OF
BOOK CORPORATION OF AMERICA
1
BYLAWS
OF
BOOK CORPORATION OF AMERICA
TABLE OF CONTENTS
------------------
PAGE
-------
Article I. Office . . . . . . . . . . . . . . . . . . . . . . . .3
Article II. Shareholders' Meeting. . . . . . . . . . . . . . . . .3
Section 2.1 Annual Meetings. . . . . . . . . . . . . . . . . . . .3
Section 2.2 Special Meetings . . . . . . . . . . . . . . . . . . .4
Section 2.3 Notice of Shareholders' Meeting. . . . . . . . . . . .4
Section 2.4 Waiver of Notice . . . . . . . . . . . . . . . . . . .4
Section 2.5 Place of Meeting . . . . . . . . . . . . . . . . . . .4
Section 2.6 Closing of Transfer Books or Filing
Record Date. . . . . . . . . . . . . . . . . . . . . .5
Section 2.7 Quorum of Shareholders . . . . . . . . . . . . . . . .5
Section 2.8 Voting Lists . . . . . . . . . . . . . . . . . . . . .6
Section 2.9 Voting . . . . . . . . . . . . . . . . . . . . . . . .6
Section 2.10 Proxies. . . . . . . . . . . . . . . . . . . . . . . .6
Section 2.11 Informal Action by Shareholders. . . . . . . . . . . .6
Article III Board of Directors . . . . . . . . . . . . . . . . . .7
Section 3.1 General Powers . . . . . . . . . . . . . . . . . . . .7
Section 3.2 Number, Tenure and Qualifications. . . . . . . . . . .7
Section 3.3 Election of Board of Directors . . . . . . . . . . . .7
Section 3.4 Regular Meetings . . . . . . . . . . . . . . . . . . .7
Section 3.5 Special Meetings . . . . . . . . . . . . . . . . . . .8
Section 3.6 Waiver of Notice . . . . . . . . . . . . . . . . . . 8
Section 3.7 Quorum . . . . . . . . . . . . . . . . . . . . . . . 8
Section 3.8 Manner of Acting . . . . . . . . . . . . . . . . . . 8
Section 3.9 Powers of Directors. . . . . . . . . . . . . . . . . 8
Section 3.10 Vacancies. . . . . . . . . . . . . . . . . . . . . . 9
Section 3.11 Removals . . . . . . . . . . . . . . . . . . . . . . 9
Section 3.12 Resignations . . . . . . . . . . . . . . . . . . . . 10
Section 3.13 Presumption of Assent. . . . . . . . . . . . . . . . 10
Section 3.14 Compensation . . . . . . . . . . . . . . . . . . . . 10
Section 3.15 Emergency Power. . . . . . . . . . . . . . . . . . . 10
Section 3.16 Chairman . . . . . . . . . . . . . . . . . . . . . . 10
Article IV Officers . . . . . . . . . . . . . . . . . . . . . . 11
Section 4.1 Number . . . . . . . . . . . . . . . . . . . . . . . 11
Section 4.2 Election and Term of Office. . . . . . . . . . . . . 11
Section 4.3 Resignations . . . . . . . . . . . . . . . . . . . . 11
Section 4.4 Removal. . . . . . . . . . . . . . . . . . . . . . . 11
Section 4.5 Vacancies. . . . . . . . . . . . . . . . . . . . . . 12
Section 4.6 President. . . . . . . . . . . . . . . . . . . . . . 12
Section 4.7 Vice President . . . . . . . . . . . . . . . . . . . 12
Section 4.8 Secretary. . . . . . . . . . . . . . . . . . . . . . 12
Section 4.9 Treasurer. . . . . . . . . . . . . . . . . . . . . . 13
Section 4.10 General Manager. . . . . . . . . . . . . . . . . . . 13
Section 4.11 Other Officers . . . . . . . . . . . . . . . . . . . 14
Section 4.12 Salaries . . . . . . . . . . . . . . . . . . . . . . 14
Section 4.13 Surety Bonds . . . . . . . . . . . . . . . . . . . . 14
Article V. Committees . . . . . . . . . . . . . . . . . . . . . 14
Section 5.1 Executive Committee. . . . . . . . . . . . . . . . . 14
Section 5.2 Other Committees . . . . . . . . . . . . . . . . . . 15
Article VI. Contracts, Loans, Deposits and Checks. . . . . . . . 15
Section 6.1 Contracts. . . . . . . . . . . . . . . . . . . . . . 15
Section 6.2 Loans. . . . . . . . . . . . . . . . . . . . . . . . 15
Section 6.3 Deposits . . . . . . . . . . . . . . . . . . . . . . 15
Section 6.4 Checks and Drafts. . . . . . . . . . . . . . . . . . 16
Section 6.5 Bonds and Debentures . . . . . . . . . . . . . . . . 16
Article VII. Capital Stock. . . . . . . . . . . . . . . . . . . . 16
Section 7.1 Certificate of Share . . . . . . . . . . . . . . . . 16
Section 7.2 Transfer of Shares . . . . . . . . . . . . . . . . . 17
Section 7.3 Transfer Agent and Registrar . . . . . . . . . . . . 17
Section 7.4 Lost or Destroyed Certificates . . . . . . . . . . . 17
Section 7.5 Consideration for Shares . . . . . . . . . . . . . . 18
Section 7.6 Registered Shareholders. . . . . . . . . . . . . . . 18
Article VIII. Indemnification. . . . . . . . . . . . . . . . . . . 18
Section 8.1 Indemnification. . . . . . . . . . . . . . . . . . . 18
Section 8.2 Other Indemnification. . . . . . . . . . . . . . . . 19
Section 8.3 Insurance. . . . . . . . . . . . . . . . . . . . . . 19
Section 8.4 Settlement by Corporation. . . . . . . . . . . . . . 19
Article IX Amendments . . . . . . . . . . . . . . . . . . . . . 20
Article X Fiscal Year. . . . . . . . . . . . . . . . . . . . . 20
Article XI Dividends. . . . . . . . . . . . . . . . . . . . . . 20
Article XII Corporate Seal . . . . . . . . . . . . . . . . . . . 21
BYLAWS
OF
BOOK CORPORATION OF AMERICA
ARTICLE I
OFFICE
------
Section 1.1 Office. The principal office of the Corporation in
the State of Utah shall be located at 9 Exchange Place, Suite 200, Salt
Lake City, Utah. The Corporation may maintain such other offices, within
or without the State of Utah, as the Board of Directors may from time to
time designate. The location of the principal office may be changed by the
Board of Directors.
ARTICLE II
SHAREHOLDERS' MEETING
----------------------
Section 2.1 Annual Meetings The annual meeting of the
shareholders of the Corporation shall be held at such place within or
without the State of Utah as shall be set forth in compliance with these
Bylaws. The meeting shall be held on the 1st Saturday of February of each
year beginning with the year 1989 at 10:00 a.m. If such day is a legal
holiday, the meeting shall be on the next business day. This meeting shall
be for the election of directors and for the transaction of such other
business as may properly come before it.
In the event that such annual meeting is omitted by oversight or
otherwise on the date herein provided for, the directors shall cause a
meeting in lieu thereof to be held as soon thereafter as conveniently may
be, and any business transacted or elections held at such meeting shall be
as valid as if transacted or held at the annual meeting. If the election
of directors shall not be held on the date designated herein for any annual
meeting of shareholders, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of
shareholders as soon thereafter as may conveniently be called. Such
subsequent meetings shall be called in the same manner as is provided for
the annual meeting of shareholders.
Section 2.2 Special Meetings. Special meetings of shareholders,
other than those regulated by statute, may be called at, any time by the
President, or by a majority of the directors, and must be called by the
President upon written request of the holders of not less than 10% of the
issued and outstanding shares entitled to vote at such special meeting.
Section 2.3 Notice of Shareholders' Meetings. The President, Vice
President or Secretary shall give written notice stating the place, day and
hour of the meeting, and in the case of a special meeting the purpose or
purposes for which the meeting is called, which shall be delivered not less
than ten nor more than fifty days before the day of the meeting, either
personally or by mail to each shareholder of record entitled to vote at
such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail addressed to the shareholder at his
address as it appears on the books of the Corporation, with postage thereon
prepaid.
Any meeting of which all shareholders shall at any time waive or have
waived notice in writing shall be a legal meeting for the transaction of
business notwithstanding that notice has not been given as hereinbefore
provided.
Section 2.4 Waiver of Notice. Whenever any notice whatever is
required to be given by these Bylaws, or the Articles of Incorporation, or
by any of the Corporation Laws of the State of Utah, a shareholder may
waive the notice of meeting by attendance, either in person or by proxy, at
the meeting, or by so stating in writing, either before or after such
meeting. Attendance at a meeting for the express purpose of objecting that
the meeting was not lawfully called or convened shall not, however,
constitute a waiver of notice.
Section 2.5 Place of Meeting. The Board of Directors may
designate any place, either within or without the State of Utah, as the
place of meeting for any annual meeting or for any special meeting called
by the Board of Directors. If no designation is made, or if a special
meeting be otherwise called, the place of meeting shall be the registered
office of the Corporation.
Section 2.6 Closing of Transfer Books or Fixing Record Date. For
the purpose of determining shareholders entitled to notice or to vote at
any meeting of shareholders or any adjournment thereof, or shareholders
entitled to receive payment of any dividend, or in order, to make a
determination of shareholders for any other proper purpose, the Board of
Directors of the Corporation may provide that the stock transfer books
shall be closed for a period not to exceed in any case 50 days. If the
stock transfer books shall be closed for the purpose of determining
shareholders entitled to notice of or to vote at a meeting of shareholders,
such books shall be closed for at least 10 days immediately preceding the
date determined to be the date of record. In lieu of closing the stock
transfer books, the Board of Directors may fix in advance a date as the
record date for any such determination of shareholders, such date in any
case to be not more than 50 days and in case of a meeting of shareholders
not less than 10 days prior to the date on which the particular action
requiring such determination of shareholders is to be taken. If the stock
transfer books are not closed and no record date is fixed for the
determination of shareholders entitled to notice or to vote at a meeting of
shareholders or shareholders entitled to receive payment of a dividend, the
date on which notice of the meeting is mailed or the date on which the
resolution of the Board of Directors declaring such dividend is adopted, as
the case may be, shall be deemed the date of record for such determination
of shareholders. When a determination of shareholders entitled to vote at
any meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof.
Section 2.7 Quorum of Shareholders. Except as herein provided and
as otherwise provided by law, at any meeting of shareholders a majority in
interest of all the shares issued and outstanding represented by
shareholders of record in person or by proxy shall constitute a quorum, but
a less interest may adjourn any meeting and the meeting may be held as
adjourned without further notice, provided, however, that directors shall
not be elected at the meeting so adjourned. When a quorum is present at any
meeting, a majority in interest of the shares represented thereat shall
decide any question brought before such meeting, unless the question is one
upon which the express provision of law or of the Articles of Incorporation
or of these Bylaws a larger or different vote is required, in which case
such express provision shall govern and control the decision of such
question.
Section 2.8 Voting Lists. The officer or agent having charge of
the stock transfer books for shares of the Corporation shall make a
complete list of the shareholders entitled to vote
at such meeting or any adjournment thereof., arranged in alphabetical
order, with the address of and the number of shares held by each, which
list shall be produced and kept open at the time and place of the meeting
and shall be subject to the inspection of any shareholder, for any purpose
germane to the meeting, during the whole time of the meeting. The original
stock transfer books shall be prima facie evidence as to who are the
shareholders entitled to examine such list or transfer books or to vote at
any meeting of shareholders.
Section 2.9 Voting. A holder of an outstanding share entitled to
vote at a meeting may vote at such meeting in person or by proxy. Except as
may otherwise be provided in the Articles of Incorporation, every
shareholder shall be entitled to one vote for each share standing in his
name on the record of shareholders. Except as herein or in the Articles of
Incorporation otherwise provided, all corporate action shall be determined
by a majority of the votes cast at a meeting of shareholders by the holders
of shares entitled to vote thereon.
Section 2.10 Proxies. At all meetings of shareholders, a
shareholder may vote in person or by proxy executed in writing by the
shareholder or by his duly authorized attorney in fact. Such proxy shall be
filed with the secretary of the Corporation before or at the time of the
meeting. No proxy shall be valid after eleven months from the date of its
execution, unless otherwise provided in the proxy.
Section 2.11 Informal Action by Shareholder. Any action required
to be taken at a meeting of the shareholders, or any action which may be
taken at a meeting of the shareholders, may be taken without a meeting if a
consent in writing, setting forth the action so taken, shall be signed by
all of the shareholders entitled to vote with respect to the subject matter
thereof.
ARTICLE III
BOARD OF DIRECTORS
-------------------
Section 3.1 General Powers. The business and affairs of the
Corporation shall be managed by its Board of Directors. The Board of
Directors may adopt such rules and regulations for the conduct of their
meetings and the management of the Corporation as they deem proper.
Section 3.2 Number, Tenure and Qualifications. The number of
directors for the Board of Directors of the Corporation shall be not less
than three nor more than ten. Each director shall hold office until the
next annual meeting of shareholders and until his successor shall have been
elected and qualified. Directors need not be residents of the State of Utah
or shareholders of the Corporation.
Section 3.3 Election of Board of Directors. The Board of
Directors shall be chosen by ballot at the annual meeting of shareholders
or at any meeting held in place thereof as provided by law.
Section 3.4 Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than by this Bylaw,
immediately following and at the same place as the annual meeting of the
shareholders. The Board of Directors may provide by resolution the time
and place for the holding of additional regular meetings without other
notice than this resolution.
Members of the Board of Directors may participate in a meeting of the
Board by means of conference telephone or similar communications equipment
by which all persons participating in the meeting can hear each other and
participation in a meeting under this subsection shall constitute presence
in person at the meeting, pursuant to Utah Code Annotated, Section 16-10-
40(d).
Section 3.5 Special Meetings. Special meetings of the Board of
Directors may be called by order of the Chairman of the Board, the
President or by one-third of the directors. The Secretary shall give
notice of the time, place and purpose or purposes of each special meeting
by mailing the same at least two days before the meeting or by telephoning
or telegraphing the same at least one day before the meeting to each
director.
Section 3.6 Waiver of Notice. Whenever any notice whatever is
required to be given by these Bylaws, or the Articles of Incorporation of
the Corporation, or by any of the Corporation Laws of the State of Utah, a
director may waive the notice of meeting by attendance in person at the
meeting, or by so stating in writing, either before or after such meeting.
Attendance at a meeting for the express purpose of objecting that the
meeting was not lawfully called or convened shall not, however, constitute
a waiver of notice.
Section 3.7 Quorum. A majority of the members of the Board of
Directors shall constitute a quorum for the transaction of business, but
less than a quorum may adjourn any meeting from time to time until a quorum
shall be present, whereupon the meeting may be held, as adjourned, without
further notice. At any meeting at which every director shall be present,
even though without any notice, any business may be transacted.
Section 3.8 Manner of Acting. At all meetings of the Board of
Directors, each director shall have one vote. The act of a majority
present at a meeting shall be the act of the Board of Directors, provided a
quorum is present. Any action required to be taken or which may be taken at
a meeting of the directors may be taken without a meeting if a consent in
writing setting forth the action so taken shall be signed by all the
directors. The directors may conduct a meeting by means of a conference
telephone or any similar communication equipment by which all persons
participating in the meeting can hear each other.
Section 3.9 Powers of Directors. The Board of Directors shall
have the responsibility for the entire management of the business of the
Corporation. In the management and control of the property, business and
affairs of the Corporation the Board of Directors is hereby vested with all
of the powers possessed by the Corporation itself so far as this delegation
of authority is not inconsistent with the laws of the State of Utah and
with the Articles of Incorporation or with these Bylaws. The Board of
Directors shall have the power to determine what constitutes net earnings,
profits and surplus, respectively, and what amounts shall be reserved for
working capital and for any other purpose and what amounts shall be
declared as dividends, and such determination by the Board of Directors
shall be final and conclusive.
Section 3.10 Vacancies. A vacancy in the Board of Directors shall
be deemed to exist in case of death, resignation or removal of any
director, or if the authorized number of directors be increased, or if the
shareholders fail at any meeting of shareholders at which any director is
to be elected, to elect the full authorized number to be elected at that
meeting.
Any vacancy occurring in the Board of Directors may be filled by an
affirmative vote of the majority of the remaining directors though less
than a quorum of the Board of Directors, unless otherwise provided by law
or the Articles of Incorporation. A director elected to fill a vacancy
shall be elected for the unexpired term of his predecessor in office. Any
directorship to be filled by reason of an increase in the number of
directors shall be filled by election at the annual meeting or at a special
meeting of shareholders called for that purpose.
Section 3.11 Removals. Directors may be removed at any time, at a
meeting called expressly for that purpose by a vote of the shareholders
holding a majority of the shares issued and outstanding and entitled to
vote. Such vacancy shall be filled by the directors then in office, though
less than a quorum, to hold office until the next annual meeting or until
his successor is duly elected and qualified, except that any directorship
to be filled by reason of removal by the shareholders may be filled by
election, by the shareholders, at the meeting at which the director is
removed. No reduction of the authorized number of directors shall have the
effect of removing any director prior to the expiration of his term of
office.
Section 3.12 Resignations. A director may resign at any time by
delivering written notification thereof to the President or Secretary of
the Corporation. Such resignation shall become effective upon its
acceptance by the Board of Directors; provided, however, that if the Board
of Directors has not acted thereon within ten days from the date of its
delivery, the resignation shall upon the tenth day be deemed accepted.
Section 3.13 Presumption of Assent. A director of the Corporation
who is present at a meeting of the Board of Directors at which action on
any corporate matter is taken shall be presumed to have assented to the
action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as the Secretary of the meeting before the adjournment
thereof or shall forward such dissent by registered mail to the Secretary
of the Corporation immediately after the adjournment of the meeting. Such
right to dissent shall not apply to a director who voted in favor of such
action.
Section 3.14 Compensation. By resolution of the Board of
Directors, the directors shall be paid their expenses, if any, of
attendance at each meeting of the Board of Directors, and may be paid a
fixed sum for attendance at each meeting of the Board of Directors or a
stated salary as director. No such payment shall preclude any director from
serving the Corporation in any other capacity and receiving compensation
therefor.
Section 3.15 Emergency Power. When, due to a national disaster or
death, a majority of the directors are incapacitated or otherwise unable to
attend the meetings and function as directors, the remaining members of the
Board of Directors shall have all the powers necessary to function as a
complete Board and, for the purpose of doing business and filling
vacancies, shall constitute a quorum until such time as all directors can
attend or vacancies can be filled pursuant to these Bylaws.
Section 3.16 Chairman. The Board of Directors may elect from its
own number a Chairman of the Board, who shall preside at all meetings of
the Board of Directors, and shall perform such other duties as may be
prescribed from time to time by the Board of Directors.
ARTICLE IV
OFFICERS
-------------
Section 4.1 Number. The officers of the Corporation shall be a
President, one or more Vice Presidents, a Secretary and a Treasurer, each
of whom shall be elected by a majority of the Board of Directors. Such
other officers and assistant officers as may be deemed necessary may be
elected or appointed by the Board of Directors. In its discretion, the
Board of Directors may leave unfilled for any such period as it may
determine any office except those of President and Secretary. Any two or
more offices may be held by the same person, except the offices of
President and Secretary. Officers may or may not be directors or
shareholders of the Corporation.
Section 4.2 Election and Term of Office. The officers of the
Corporation are to be elected by the Board of Directors at the first
meeting of the Board of Directors held after each annual meeting of the
shareholders. If the election of officers shall not be held at such
meeting, such election shall be held as soon thereafter as convenient.
Each officer shall hold office until his successor shall have been duly
elected and shall have qualified or until his death or until he shall
resign or shall have been removed in the manner hereinafter provided.
Section 4.3 Resignation. Any officer may resign at any time by
delivering a written resignation either to the President or to the
Secretary. Unless otherwise specified therein, such resignation shall take
effect upon delivery.
Section 4.4 Removal. Any officer or agent may be removed by the
Board of Directors whenever in its judgment the best interests of the
Corporation will be served thereby but such removal shall be without
prejudice to the contract rights, if any, of the person so removed.
Election or appointment of an officer or agent shall not of itself create
contract rights. Any such removal shall require a majority vote of the
Board of Directors, exclusive of the officer in question if he is also a
director.
Section 4.5 Vacancies A vacancy in any office because of death,
resignation, removal, disqualification or otherwise, or if a new office
shall be created, may be filled by the Board of Directors for the unexpired
portion of the term.
Section 4.6 President. The President shall be the chief executive
and administrative officer of the Corporation. He shall preside at all
meetings Of the Shareholders and, in the absence of the Chairman of the
Board, at meetings of the Board of Directors. He shall exercise such
duties as customarily pertain to the Office of President and shall have
general and active supervision over the property, business and affairs of
the Corporation and over its several officers. He may appoint officers,
agents or employees other than those appointed by the Board of Directors.
He may sign, execute and deliver in the name of the Corporation, powers of
attorney, certificates of stock, contracts, bonds, deeds, mortgages and
other obligations and shall perform such other duties as may be prescribed
from time to time by the Board of Directors or by the Bylaws.
Section 4.7 Vice President. The Vice President shall have such
powers and perform such duties as may be assigned to him by the Board of
Directors or the President. In the absence or disability of the President,
the Vice President designated by the Board of Directors or the President
shall perform the duties and exercise the powers of the President. In the
event there is more than one Vice President and the Board of Directors has
not designated which Vice President is to act as President, then the Vice
President who was elected first shall act as President. A Vice President
may sign and execute contracts and other obligations pertaining to the
regular course of his duties.
Section 4.8 Secretary. The Secretary shall keep the minutes of all
meetings of the shareholders and of the Board of Directors and to the
extent ordered by the Board of Directors or the President, the minutes of
meetings of all committees. He shall cause notice to be given of the
meetings of shareholders, of the Board of Directors and any committee
appointed by the Board. He shall have custody of the corporate seal and
general charge of the records, documents and papers of the Corporation not
pertaining to the performance of the duties vested in other officers, which
shall at all reasonable times be open to the examination of any directory.
He may sign or execute contracts with the President or Vice President
thereunto authorized in the name of the Corporation and affix the seal of
the Corporation thereto. He shall perform such other duties as may be
prescribed from time to time by the Board of Directors or by the Bylaws.
He shall be sworn to the faithful discharge of his duties. Assistant
Secretaries shall assist the Secretary and shall keep and record such
minutes of meetings as shall be directed by the Board of Directors.
Section 4.9 Treasurer. The Treasurer shall have general custody of
the collection and disbursement of funds of the Corporation for collection
checks, notes, and other obligations, and shall deposit the same to the
credit of the Corporation in such bank or banks or depositories as the
Board of Directors may designate. He may sign, with the President, or such
other persons as may be designated for the purpose by the Board of
Directors, all bills of exchange or promissory notes of the Corporation.
He shall enter or cause to be entered regularly in the books of the
Corporation full and accurate accounts of all monies received and paid by
him on account of the Corporation; shall at all reasonable times exhibit
his books and accounts to any director of the Corporation upon application
at the office of the Corporation during business hours; and, whenever
required by the Board of Directors or the President, shall render a
statement of his accounts. He shall perform such other duties as may be
prescribed from time to time by the Board of Directors or by the Bylaws.
Section 4.10 General Manager. The Board of Directors may employ
and appoint a General Manager who may, or may not, be one of the officers
or directors of the Corporation. If employed by the Board of Directors he
shall be the chief operating officer of the Corporation and, subject to the
directions of the Board of Directors, shall have general charge of the
business operations of the Corporation and general supervision over its
employees and agents. He shall have the exclusive management of the
business of the Corporation and of all of its dealings, but at all times
subject to the control of the Board of Directors. Subject to the approval
of the Board of Directors or the executive committee, he shall employ all
employees of the Corporation, or delegate such employment to subordinate
officers, or such division officers, or such division chiefs, and shall
have authority to discharge any person so employed. He shall make a
quarterly report to the President and directors, or more often if required
to do so, setting forth the result of the operations under his charge,
together with suggestions looking to the improvement and betterment of the
condition of the Corporation, and to perform such other duties as the Board
of Directors shall require.
Section 4.11 Other Officers. Other officers shall perform such
duties and have such powers as may be assigned to them by the Board of
Directors.
Section 4.12 Salaries. The salaries or other compensation of the
officers of the Corporation shall be fixed from time to time by the Board
of Directors except that the Board of Directors may delegate to any person
or group of persons the power to fix the salaries or other compensation of
any subordinate officers or agents. No officer shall be prevented from
receiving any such salary or compensation by reason of the fact that he is
also a director of the Corporation.
Section 4.13 Surety Bonds. In case the Board of Directors shall
so require, any officer or agent of the Corporation shall execute to the
Corporation a bond in such sums and with sureties as the Board of Directors
may direct, conditioned upon the faithful performance of his duties to the
Corporation, including responsibility for negligence and for the accounting
for all property, monies or securities of the Corporation which may come
into his hands.
ARTICLE V
COMMITTEES
---------------
Section 5.1 Executive Committee. The Board of Directors may
appoint from among its members an Executive Committee of not less than two
nor more than seven members, one of whom shall be the President, and shall
designate one or more of its members as alternates to serve as a member or
members of the Executive Committee in the absence of a regular member or
members. The Board of Directors reserves to itself alone the power to
declare dividends, issue stock, recommend to shareholders any action
requiring their approval, change the membership of any committee at any
time, fill vacancies therein, and discharge any committee either with or
without cause at any time. Subject to the foregoing limitations, the
Executive Committee shall possess and exercise all other powers of the
Board of Directors during the intervals between meetings.
Section 5.2 Other Committees. The Board of Directors may also
appoint from among its own members such other committees as the Board may
determine, which shall in each case consist of not less than two directors,
and which shall have such powers and duties as shall from time to time be
prescribed by the Board. The President shall be a member ex officio of
each committee appointed by the Board of Directors. A majority of the
members of any committee may fix its rules of procedure.
ARTICLE VI
CONTRACTS, LOANS, DEPOSITS AND CHECKS
---------------------------------------
Section 6.1 Contracts. The Board of Directors may authorize any
officer or officers, agent or agents, to enter into any contract or execute
and deliver any instrument in the name of and on behalf of the Corporation,
and such authority may be general or confined to specific instances.
Section 6.2 Loans. No loan or advances shall be contracted on
behalf of the Corporation, no negotiable paper or other evidence of its
obligations under any loan or advance shall be issued in its name, and no
property of the Corporation shall be mortgaged, pledged, hypothecated or
transferred as security for the payment of any loan, advance, indebtedness
or liability of the Corporation unless and except as authorized by the
Board of Directors. Any such authorization may be general or confined to
specific instances.
Section 6.3 Deposits. All funds of the Corporation not otherwise
employed shall be deposited from time to time to the credit of the
Corporation in such banks, trust companies or other depositories as the
Board of Directors may select, or as may be selected by any officer or
agent authorized to do so by the Board of Directors.
Section 6.4 Checks and Drafts. All notes, drafts, acceptances,
checks, endorsements and evidences of indebtedness of the Corporation shall
be signed by such officer or officers or such agent or agents of the
Corporation and in such manner as the Board of Directors from time to time
may determine. Endorsements for deposit to the credit of the Corporation
in any of its duly authorized depositories shall be made in such manner as
the Board of Directors from time to time may determine.
Section 6.5 Bonds and Debentures. Every bond or debenture issued
by the Corporation shall be evidenced by an appropriate instrument which
shall be signed by the President or a Vice President and by the Treasurer
or by the Secretary, and sealed with the seal of the Corporation. The seal
may be facsimile, engraved or printed. Where such bond or debenture is
authenticated with the manual signature of an authorized officer of the
Corporation or other trustee designated by the indenture of trust or other
agreement under which such security is issued, the signature of any of the
Corporation's officers named thereon may be a facsimile. In case any
officer who signed, or whose facsimile signature has been used on any such
bond or debenture, shall cease to be an officer of the Corporation for any
reason before the same has been delivered by the Corporation, such bond or
debenture may nevertheless be adopted by the Corporation and issued and
delivered as though the person who signed it or whose facsimile signature
has been used thereon had not ceased to be such officer.
ARTICLE VII
CAPITAL STOCK
----------------
Section 7.1 Certificate of Shares. The shares of the Corporation
shall be represented by certificates prepared by the Board of Directors and
signed by the President or the Vice President, and by the Secretary, or an
Assistant Secretary, and sealed with the seal of the Corporation or a
facsimile. The signatures of such officers upon a certificate may be
facsimiles if the certificate is countersigned by a transfer agent or
registered by a registrar other than the Corporation itself or one of its
employees. All certificates for shares shall be consecutively numbered or
otherwise identified. The name and address of the person to whom the
shares represented thereby are issued, with the number of shares and date
of issue, shall be entered on the stock transfer books of the Corporation.
All certificates surrendered to the Corporation for transfer shall be
canceled and no new certificate shall be issued until the former
certificate for a like number of shares shall have been surrendered and
canceled, except that in case of a lost, destroyed or mutilated certificate
a new one may be issued therefor upon such terms and indemnity to the
Corporation as the Board of Directors may prescribe.
Section 7.2 Transfer of Shares. Transfer of shares of the
Corporation shall be made only on the stock transfer books of the
Corporation by the holder of record thereof or by his legal representative,
who shall furnish proper evidence of authority to transfer, or by his
attorney thereunto authorized by power of attorney duly executed and filed
with the Secretary of the Corporation, and on surrender for cancellation of
the certificate for such shares. The person in whose name shares stand on
the books of the Corporation shall be deemed by the Corporation to be the
owner thereof for all purposes.
Section 7.3 Transfer Agent and Registrar. The Board of Directors
shall have power to appoint one or more transfer agents and registrars for
the transfer and registration of certificates of stock of any class, and
may require that stock certificates shall be countersigned and registered
by one or more of such transfer agents and registrars.
Section 7.4 Lost or Destroyed Certificates. The Corporation may
issue a new certificate to replace any certificate theretofore issued by it
alleged to have been lost or destroyed. The Board of Directors may require
the owner of such a certificate or his legal representatives to give the
Corporation a bond in such sum and with such sureties as the Board of
Directors may direct to indemnify the Corporation and its transfer agents
and registrars, if any, against claims that may be made on account of the
issuance of such new certificates. A new certificate may be issued without
requiring any bond.
Section 7.5 Consideration for Shares. The capital stock of the
Corporation shall be issued for such consideration, but not less than the
par value thereof, as shall be fixed from time to time by the Board of
Directors. In the absence of fraud, the determination of the Board of
Directors as to the value of any property or services received in full or
partial payment of shares shall be conclusive.
Section 7.6 Registered Shareholders. The Corporation shall be
entitled to treat the holder of record of any share or shares of stock as
the holder thereof in fact, and shall not be bound to recognize any
equitable or other claim to or on behalf of the Corporation, any and all of
the rights and powers incident to the ownership of such stock at any such
meeting, and shall have power and authority to execute and deliver proxies
and consents on behalf of the Corporation in connection with the exercise
by the Corporation of the rights and powers incident to the ownership of
such stock. The Board of Directors, from time to time may confer like
powers upon any other person or persons.
ARTICLE VIII
INDEMNIFICATION
---------------------
Section 8.1 Indemnification. No officer or director shall be
personally liable for any obligations arising out of any acts or conduct of
said officer or director performed for or on behalf of the Corporation.
The Corporation shall and does hereby indemnify and hold harmless each
person and his heirs and administrators who shall serve at any time
hereafter as a director or officer of the Corporation from and against any
and all claims, judgments and liabilities to which such persons shall
become subject by reason of any action alleged to have been heretofore or
hereafter taken or omitted to have been taken by him as such director or
officer, and shall reimburse each such person for all legal and other
expenses reasonably incurred by him in connection with any such claim or
liability; including power to defend such person from all suits as provided
for under the provisions of the Utah Corporation Laws; provided, however
that no such person shall be indemnified against, or be reimbursed for, any
expense incurred in connection with any claim or liability arising out of
his own negligence or willful misconduct. The rights accruing to any
person under the foregoing provisions of this section shall not exclude any
other right to which he may lawfully be entitled, nor shall anything herein
contained restrict the right of the Corporation to indemnify or reimburse
such person in any proper case, even though not specifically herein
provided for. The Corporation, its directors, officers, employees and
agents shall be fully protected in taking any action or making any payment
or in refusing so to do in reliance upon the advice of counsel.
Section 8.2 Other Indemnification. The indemnification herein
provided shall not be deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any bylaw, agreement, vote of
shareholders or disinterested directors, or otherwise, both as to action in
his official capacity and as to action in another capacity while holding
such office, and shall continue as to a person who has ceased to be a
director, officer or employee and shall inure to the benefit of the heirs,
executors and administrators of such a person.
Section 8.3 Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who is or was a director, officer or
employee of the Corporation, or is or was serving at the request of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against him and incurred by him in any capacity, or
arising out of his status as such, whether or not the Corporation would
have the power to indemnify him against liability under the provisions of
this Article 8 or the laws of the State of Utah.
Section 8.4 Settlement by Corporation. The right of any person to
be indemnified shall be subject always to the right of the Corporation by
its Board of Directors, in lieu of such indemnity, to settle any such
claim, action, suit or proceeding at the expense of the Corporation by the
payment of the amount of such settlement and the costs and expenses
incurred in connection therewith.
ARTICLE IX
AMENDMENTS
-----------
These Bylaws may be altered, amended, repealed, or added to by the
affirmative vote of the holders of a majority of the shares entitled to
vote in the election of any director at an annual meeting or at a special
meeting called for that purpose, provided that a written notice shall have
been sent to each shareholder of record entitled to vote at such meetings
at least ten days before the date of such annual or special meetings, which
notice shall state the alterations, amendments, additions, or changes which
are proposed to be made in such Bylaws. Only such changes shall be made as
have been specified in the notice. The Bylaws may also be altered, amended,
repealed, or new Bylaws adopted by a majority of the entire Board of
Directors at any regular or special meeting. Any Bylaws adopted by the
Board may be altered, amended, or repealed by a majority of the
shareholders entitled to vote.
ARTICLE X
FISCAL YEAR
--------------
The fiscal year of the Corporation shall be October 31st and may be
varied by resolution of the Board of Directors.
ARTICLE XI
DIVIDENDS
--------------
The Board of Directors may at any regular or special meeting, as they
deem advisable, declare dividends payable out of the unreserved and
unrestricted earned surplus of the Corporation except the directors may
declare dividends in accordance with the laws of the State of Utah.
ARTICLE XII
CORPORATE SEAL
----------------
The seal of the Corporation shall be in the form of a circle and shall
bear the name of the Corporation and the year of incorporation.
Adopted by resolution of the Board of Directors the 10th day of
October, 1988.
By: /s/ Philip Yordan
--------------------------------
Secretary
[Letterhead]
Consent of Darrell T. Schvaneveldt
Independent Auditor
I consent to the use, of our report dated March 16, 2000, on the
financial statements of Book Corporation of America, dated October 31,
1999, included herein and to the reference made to me.
/S/ Schvaneveldt & Company
Salt Lake City, Utah
May 17, 2000
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