U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-KSB
[X] Annual report pursuant to section 13 or 15(d) of the
Securities Exchange Act of 1934 for the fiscal year ended March
31, 1999, or
[ ] Transition report pursuant to section 13 or 15(d) of the
Securities Exchange act of 1934 for the transition period from
to
Commission File No. 2-93231-NY
FASHION TECH INTERNATIONAL, INC.
(Name of Small Business Issuer as specified in its charter)
(Formerly Portofino Investment, Inc.)
Nevada 87-0395695
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
1340 East 130 North, Springville, Utah 84663
(Address of Principal Executive Offices and Zip Code)
Issuer's Telephone Number: (801) 364-9262
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act: None
Check whether the issuer (1) filed all reports required to be
filed by sections 13 or 15(d) of the Exchange Act during the past
12 months (or such shorter period that the issuer was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [ ] No [X]
Check if there is no disclosure of delinquent filers in response
to Item 405 of Regulation S-B in this form, and no disclosure
will be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by
reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. [X]
The Registrant's revenues (consisting only of interest income)
for its most recent fiscal year: $0.
The aggregate market value of voting stock held by non-
affiliates: As of the date this report is filed there is no
public market for the common stock of the issuer, so the
aggregate market value of such stock is $0.
As of December 31, 1999, the Registrant had outstanding 3,591,143
shares of Common Stock, par value $0.001.
Documents incorporated by reference: None.
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TABLE OF CONTENTS
ITEM NUMBER AND CAPTION Page
Part I
1. Description of Business 3
2. Description of Properties 6
3. Legal Proceedings 6
4. Submission of Matters to a Vote of Security Holders 6
Part II
5. Market for Common Equity and Related Stockholder 7
Matters
6. Management's Discussion and Analysis of Financial 7
Condition and Results of Operations
7. Financial Statements 7
8. Changes in and Disagreements with Accountants 8
on Accounting and Financial Disclosure
Part III
9. Directors, Executive Officers, Promoters and Control 8
Persons; Compliance with Section 16(a) of the
Exchange Act
10. Executive Compensation 9
11. Security Ownership of Certain Beneficial Owners and 9
Management
12. Certain Relationships and Related Transactions 10
13. Exhibits and Reports on Form 8-K 10
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FORWARD-LOOKING STATEMENT NOTICE
When used in this report, the words "may," "will," "expect,"
"anticipate," "continue," "estimate," "project," "intend," and
similar expressions are intended to identify forward-looking
statements within the meaning of Section 27a of the Securities
Act of 1933 and Section 21e of the Securities Exchange Act of
1934 regarding events, conditions, and financial trends that may
affect the Company's future plans of operations, business
strategy, operating results, and financial position. Persons
reviewing this report are cautioned that any forward-looking
statements are not guarantees of future performance and are
subject to risks and uncertainties and that actual results may
differ materially from those included within the forward-looking
statements as a result of various factors. Such factors are
discussed under the headings "Item 1. Description of Business,"
and "Item 6. Management's Discussion and Analysis of Financial
Condition and Results of Operations," and also include general
economic factors and conditions that may directly or indirectly
impact the Company's financial condition or results of
operations.
PART I
ITEM 1. DESCRIPTION OF BUSINESS
General
For the past three years the Company has had no active business
operations, and has been seeking to acquire an interest in a
business with long-term growth potential. The Company was
originally formed as a Utah corporation in April 1983 under the
name Portofino Investments, Inc. In January 1984, the Company
changed its name to Fashion Tech International, Inc. It has been
an inactive shell corporation for at least the past 10 years. In
April 1999, the stockholders approved a merger with Fashion Tech
International, Inc., a Nevada corporation to change the domicile
of the Company from Utah to Nevada.
The Company currently has no commitment or arrangement to
participate in a business and cannot now predict what type of
business it may enter into or acquire. It is emphasized that the
business objectives discussed herein are extremely general and
are not intended to be restrictive on the discretion of the
Company's management.
In June of 1999 the Company converted its note payable in the
principal amount of $22,000, and accrued interest to common stock
at the rate of $0.0073 per share, or a total of 3,000,000 shares.
The holder of the note was Trinity American Corporation.
Selection of a Business
The Company anticipates that businesses for possible acquisition
will be referred by various sources, including its officers and
directors, professional advisors, securities broker-dealers,
venture capitalists, members of the financial community, and
others who may present unsolicited proposals. The Company will
not engage in any general solicitation or advertising for a
business opportunity, and will rely on personal contacts of its
officers and directors and their affiliates, as well as indirect
associations between them and other business and professional
people. By relying on "word of mouth", the Company may be
limited in the number of potential acquisitions it can identify.
While it is not presently anticipated that the Company will
engage unaffiliated professional firms specializing in business
acquisitions or reorganizations, such firms may be retained if
management deems it in the best interest of the Company.
Compensation to a finder or business acquisition firm may take
various forms, including one-time cash payments, payments based
on a percentage of revenues or product sales volume, payments
involving issuance of securities (including those of the
Company), or any combination of these or other compensation
arrangements. Consequently, the Company is currently unable to
predict the cost of utilizing such services.
The Company will not restrict its search to any particular
business, industry, or geographical location, and management
reserves the right to evaluate and enter into any type of
business in any location. The Company may
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participate in a newly organized business venture or a more
established company entering a new phase of growth or in need of
additional capital to overcome existing financial problems.
Participation in a new business venture entails greater risks since
in many instances management of such a venture will not have proved
its ability, the eventual market of such venture's product or services
will likely not be established, and the profitability of the venture
will be unproved and cannot be predicted accurately. If the
Company participates in a more established firm with existing
financial problems, it may be subjected to risk because the
financial resources of the Company may not be adequate to
eliminate or reverse the circumstances leading to such financial
problems.
In seeking a business venture, the decision of management will
not be controlled by an attempt to take advantage of any
anticipated or perceived appeal of a specific industry,
management group, product, or industry, but will be based on the
business objective of seeking long-term capital appreciation in
the real value of the Company.
The analysis of new businesses will be undertaken by or under the
supervision of the officers and directors. In analyzing
prospective businesses, management will consider, to the extent
applicable, the available technical, financial, and managerial
resources; working capital and other 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 that management; the potential for further research,
development, or exploration; the potential for growth and
expansion; the potential for profit; the perceived public
recognition or acceptance of products, services, or trade or
service marks; name identification; and other relevant factors.
The decision to participate in a specific business may be based
on management's analysis of the quality of the other firm's
management and personnel, the anticipated acceptability of new
products or marketing concepts, the merit of technological
changes, and other factors which are difficult, if not
impossible, to analyze through any objective criteria. 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 shift marketing
approaches, expand significantly, change product emphasis, change
or substantially augment management, and other factors.
The Company will analyze all available factors and make a
determination based on a composite of available facts, without
reliance on any single factor. The period within which the
Company may participate in a business cannot be predicted and
will depend on circumstances beyond the Company's control,
including the availability of businesses, the time required for
the Company to complete its investigation and analysis of
prospective businesses, the time required to prepare appropriate
documents and agreements providing for the Company's
participation, and other circumstances.
Acquisition of a Business
In implementing a structure for a particular business
acquisition, the Company may become a party to a merger,
consolidation, or other reorganization with another corporation
or entity; joint venture; license; purchase and sale of assets;
or purchase and sale of stock, the exact nature of which cannot
now be predicted. Notwithstanding the above, the Company does
not intend to participate in a business through the purchase of
minority stock positions. On the consummation of a transaction,
it is likely that the present management and shareholders of the
Company will not be in control of the Company. In addition, a
majority or all of the Company's directors may, as part of the
terms of the acquisition transaction, resign and be replaced by
new directors without a vote of the Company's shareholders.
In connection with the Company's acquisition of a business, the
present shareholders of the Company, including officers and
directors, may, as a negotiated element of the acquisition, sell
a portion or all of the Company's Common Stock held by them at a
significant premium over their original investment in the
Company. It is not unusual for affiliates of the entity
participating in the reorganization to negotiate to purchase
shares held by the present shareholders in order to reduce the
number of "restricted securities" held by persons no longer
affiliated with the Company and thereby reduce the potential
adverse impact on the public market in the Company's Common Stock
that could result from substantial sales of such shares after the
restrictions no longer apply. As a result of such sales,
affiliates of the entity participating in the business
reorganization with the Company would acquire a higher percentage
of equity ownership in the Company. Public investors will not
receive any portion of the
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premium that may be paid in the foregoing circumstances. Furthermore,
the Company's shareholders may not be afforded an opportunity to
approve or consent to any particular stock buy-out transaction.
In the event sales of shares by present shareholders of the
Company, including officers and directors, is a negotiated
element of a future acquisition, a conflict of interest may arise
because directors will be negotiating for the acquisition on
behalf of the Company and for sale of their shares for their own
respective accounts. Where a business opportunity is well suited
for acquisition by the Company, but affiliates of the business
opportunity impose a condition that management sell their shares
at a price which is unacceptable to them, management may not
sacrifice their financial interest for the Company to complete
the transaction. Where the business opportunity is not well
suited, but the price offered management for their shares is
high, management will be tempted to effect the acquisition to
realize a substantial gain on their shares in the Company.
Management has not adopted any policy for resolving the foregoing
potential conflicts, should they arise, and does not intend to
obtain an independent appraisal to determine whether any price
that may be offered for their shares is fair. Stockholders must
rely, instead, on the obligation of management to fulfill its
fiduciary duty under state law to act in the best interests of
the Company and its stockholders.
It is anticipated that any securities issued in any such
reorganization would be issued in reliance on exemptions from
registration under applicable federal and state securities laws.
In some circumstances, however, as a negotiated element of the
transaction, the Company may agree to register such securities
either at the time the transaction is consummated, under certain
conditions, or at specified times thereafter. Although the terms
of such registration rights and the number of securities, if any,
which may be registered cannot be predicted, it may be expected
that registration of securities by the Company in these
circumstances would entail substantial expense to the Company.
The issuance of substantial additional securities and their
potential sale into any trading market that may develop in the
Company's securities may have a depressive effect on such market.
While the actual terms of a transaction to which the Company may
be a party cannot be predicted, it may be expected that the
parties to the business transaction will find it desirable to
structure the acquisition as a so-called "tax-free" event under
sections 351 or 368(a) of the Internal Revenue Code of 1986, (the
"Code"). In order to obtain tax-free treatment under section 351
of the Code, it would be necessary for the owners of the acquired
business to own 80% or more of the voting stock of the surviving
entity. In such event, the shareholders of the Company would
retain less than 20% of the issued and outstanding shares of the
surviving entity. Section 368(a)(1) of the Code provides for tax-
free treatment of certain business reorganizations between
corporate entities where one corporation is merged with or
acquires the securities or assets of another corporation.
Generally, the Company will be the acquiring corporation in such
a business reorganization, and the tax-free status of the
transaction will not depend on the issuance of any specific
amount of the Company's voting securities. It is not uncommon,
however, that as a negotiated element of a transaction completed
in reliance on section 368, the acquiring corporation issue
securities in such an amount that the shareholders of the
acquired corporation will hold 50% or more of the voting stock of
the surviving entity. Consequently, there is a substantial
possibility that the shareholders of the Company immediately
prior to the transaction would retain less than 50% of the issued
and outstanding shares of the surviving entity. Therefore,
regardless of the form of the business acquisition, it may be
anticipated that stockholders immediately prior to the
transaction will experience a significant reduction in their
percentage of ownership in the Company.
Notwithstanding the fact that the Company is technically the
acquiring entity in the foregoing circumstances, generally
accepted accounting principles will ordinarily require that such
transaction be accounted for as if the Company had been acquired
by the other entity owning the business and, therefore, will not
permit a write-up in the carrying value of the assets of the
other company.
The manner in which the Company participates in a business will
depend on the nature of the business, the respective needs and
desires of the Company and other parties, the management of the
business, and the relative negotiating strength of the Company
and such other management.
The Company will participate in a business only after the
negotiation and execution of appropriate written agreements.
Although the terms of such agreements cannot be predicted,
generally such agreements will require
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specific representations and warranties by all of the parties
thereto, will specify certain events of default, will detail
the terms of closing and the conditions which must be satisfied
by each of the parties prior to such closing, will outline the
manner of bearing costs if the transaction is not closed, will set
forth remedies on default, and will include miscellaneous other terms.
Operation of Business After Acquisition
The Company's operation following its acquisition of a business
will be dependent on the nature of the business and the interest
acquired. The Company is unable to predict whether the Company
will be in control of the business or whether present management
will be in control of the Company following the acquisition. It
may be expected that the business will present various risks,
which cannot be predicted at the present time.
Governmental Regulation
It is impossible to predict the government regulation, if any, to
which the Company may be subject until it has acquired an
interest in a business. The use of assets and/or conduct of
businesses that the Company may acquire could subject it to
environmental, public health and safety, land use, trade, or
other governmental regulations and state or local taxation. In
selecting a business in which to acquire an interest, management
will endeavor to ascertain, to the extent of the limited
resources of the Company, the effects of such government
regulation on the prospective business of the Company. In
certain circumstances, however, such as the acquisition of an
interest in a new or start-up business activity, it may not be
possible to predict with any degree of accuracy the impact of
government regulation. The inability to ascertain the effect of
government regulation on a prospective business activity will
make the acquisition of an interest in such business a higher
risk.
Competition
The Company will be involved in intense competition with other
business entities, many of which will have a competitive edge
over the Company by virtue of their stronger financial resources
and prior experience in business. There is no assurance that the
Company will be successful in obtaining suitable investments.
Employees
The Company is a development stage company and currently has no
employees. Executive officers, who are not compensated for their
time contributed to the Company, will devote only such time to
the affairs of the Company as they deem appropriate, which is
estimated to be approximately 20 hours per month per person.
Management of the Company expects to use consultants, attorneys,
and accountants as necessary, and does not anticipate a need to
engage any full-time employees so long as it is seeking and
evaluating businesses. The need for employees and their
availability will be addressed in connection with a decision
whether or not to acquire or participate in a specific business
industry.
ITEM 2. DESCRIPTION OF PROPERTIES
The Company utilizes office space at 1340 East 130 North,
Springville, Utah 84663, provided by George Horton, a officer and
director. The Company does not pay rent for this office space.
ITEM 3. LEGAL PROCEEDINGS
The Company is not a party to any legal proceedings, and to the
best of its knowledge, no such proceedings by or against the
Company have been threatened.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders in the
fourth quarter of fiscal year 1999.
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PART III
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There has been no public trading market for the Company's common
stock for at least the past ten years. Following the filing of
this report, the Company will seek out one or more stock
brokerage firms to make a market in the Company's common stock
and submit an application for quotation of the Company's common
stock on the OTC Bulletin Board operated by the National
Association of Securities Dealers, Inc., or the "Pink Sheets"
operated by the National Quotation Bureau. There is no assurance
that a trading market in the common stock will be established in
the future.
Since its inception, no dividends have been paid on the Company's
common stock. The Company intends to retain any earnings for use
in its business activities, so it is not expected that any
dividends on the common stock will be declared and paid in the
foreseeable future.
On December 31, 1999, there were approximately 491 holders of
record of the Company's Common Stock.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION
AND RESULTS OF OPERATIONS
Results of Operations
Years Ended March 31, 1999 and 1998
The Company had no revenue during the last two years. The
Company had no general and administrative expenses in 1998, but
did incur $8,555 of such expenses in 1999. General and
administrative expenses during 1999, consisted of fees and
related expenses associated with reviving the Company. In 1998
and 1999 the Company recognized interest expense of $0 and $111
respectively, which represents interest on one obligation in the
principal amount of $22,000 owed to Sonos Management Corporation.
The Company realized a net loss of $8,666 in 1999. The Company
does not expect to generate any revenue unless and until it
acquires an interest in an operating company.
Liquidity and Capital Resources
At March 31, 1999, the Company had working capital deficit of
$8,666. This deficit is largely attributable to debt and interest
obligations owed to affiliates of the Company, who have not
pressed the Company for payment in hopes the Company will locate
a business venture in which to participate that will serve as a
resource for payment of the obligations. The Company's current
plan is to handle the administrative and reporting requirements
of a public company; and search for potential businesses,
products, technologies and companies for acquisition. At
present, the Company has no understandings, commitments or
agreements with respect to the acquisition of any business,
product, technology or company and there can be no assurance that
the Company will identify any such business, product, technology
or company suitable for acquisition in the future. Further,
there can be no assurance that the Company would be successful in
consummating any acquisition on favorable terms or that it will
be able to profitably manage the business, product, technology or
company it acquires. The Company's ability to pursue its plan is
dependent on the continued forbearance of its affiliated
creditors and their willingness to advance additional funds to
the Company as needed.
ITEM 7. FINANCIAL STATEMENTS
The financial statements of the Company appear at the end of this
report beginning with the Index to Financial Statements on page F-1.
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ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
There have been no changes in or disagreements with accountants
in the past three years.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS;
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Directors and Officers
The following table sets forth the names, ages, and positions
with the Company for each of the directors and officers of the
Company.
Name Age Positions Since
Pam Jowett 46 President and Director 1999
Paul W. Nielsen 78 Vice President and Director 1999
George P. Horton 66 Secretary/ Treasurer and 1999
Director
All directors hold office until the next annual meeting of
stockholders and until their successors are elected and qualify.
Officers serve at the discretion of the Board of Directors.
The following is information on the business experience of each
director and officer.
Pam Jowett has been self-employed for over the past five years as
a nail technician.
Paul W. Nielsen has been retired since 1984. Mr. Nielsen is
currently serving as an officer of Prestige Capital Corporation
and Fashion Tech International, Inc.
George R. Horton is a graduate of Brigham Young University in
animal husbandry and the University of Utah in secondary
education. Currently, Mr. Horton is serving as the chief
executive officer of two corporations and the secretary and
treasurer of two corporations, including Prestige Capital
Corporation. Mr. Horton is also serving as an officer and
director of numerous public companies.
Other Shell Company Activities
Ms. Jowett, Mr. Nielsen and Mr. Horton are currently officers and
directors of Prestige Capital Corporation. Ms. Jowett is an
officer and director of Business Valet Services, Inc., First
Growth Investors, Inc., and Digital Home Theater Systems, Inc.
Mr. Horton is an officer and director of MG Inc. All of the
aforementioned companies are shell corporations seeking a
business acquisition and are non-reporting, publicly held
corporations, except for Prestige Capital Corporation, which is a
reporting company. The possibility exists that one or more of
the officers and directors of the Company could become officers
and/or directors of other shell companies in the future, although
they have no intention of doing so at the present time. Certain
conflicts of interest are inherent in the participation of the
Company's officers and directors as management in other shell
companies, which may be difficult, if not impossible, to resolve
in all cases in the best interests of the Company. Failure by
management to
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conduct the Company's business in its best interests may result in
liability of management of the Company to the shareholders.
ITEM 10. EXECUTIVE COMPENSATION
The Company has no agreement or understanding, express or
implied, with any officer, director, or principal stockholder, or
their affiliates or associates, regarding employment with the
Company or compensation for services. There is no understanding
between the Company and any of its present stockholders regarding
the sale of a portion or all of the common stock currently held
by them in connection with any future participation by the
Company in a business. There are no other plans, understandings,
or arrangements whereby any of the Company's officers, directors,
or principal stockholders, or any of their affiliates or
associates, would receive funds, stock, or other assets in
connection with the Company's participation in a business. No
advances have been made or contemplated by the Company to any of
its officers, directors, or principal stockholders, or any of
their affiliates or associates.
There is no policy that prevents management from adopting a plan
or agreement in the future that would provide for cash or stock
based compensation for services rendered to the Company.
On acquisition of a business, it is possible that current
management will resign and be replaced by persons associated with
the business acquired, particularly if the Company participates
in a business by effecting a stock exchange, merger, or
consolidation. In the event that any member of current
management remains after effecting a business acquisition, that
member's time commitment and compensation will likely be adjusted
based on the nature and location of such business and the
services required, which cannot now be foreseen.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
In April 1999, the stockholders approved a 100 to 1 reverse split
of the Company's outstanding common stock. The following table
sets forth as of December 31, 1999, the number and percentage of
the outstanding shares of common stock which, according to the
information supplied to the Company, were beneficially owned by
(i) each person who is currently a director of the Company, (ii)
each executive officer, (iii) all current directors and executive
officers of the Company as a group and (iv) each person who, to
the knowledge of the Company, is the beneficial owner of more
than 5% of the outstanding common stock. Except as otherwise
indicated, the persons named in the table have sole voting and
dispositive power with respect to all shares beneficially owned,
subject to community property laws where applicable.
Common Shares Percent of Class
Principal
Shareholders
Lynn Dixon 1,150,000 32.0%
311 S. State Street, Suite 460
Salt Lake City, UT 84111
Scott Bills 900,000 25.1
1476 East 3045 South
Salt Lake City, UT 84106
Paul McAlister 900,000 25.1
485 West 40 South
Lindon, UT 84042
Clair Olsen 900,000 25.1
768 Gull Avenue
Foster City, CA 94404
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Officers and Directors
Pam Jowett -0- -0-
2508 South 1300 East
Salt Lake City, 84106
Paul W. Nielsen -0- -0-
11188 South Woodfield Road
South Jordan, Utah 84095
George P. Horton -0- -0-
1340 East 130 North
Springville, Utah 84663
All officers and directors (3 persons) -0- -0-
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Sonos Management Corporation made a loan to the Company in 1999
in the amount of $22,000. The loan bears interest at the rate of
eight percent per annum and is payable on demand. Mr. Horton is
the President and sole Director of Sonos Management Corporation.
The proceeds of the loans were and will be used to revive the
Company and cover the costs associated with bringing its
reporting obligations under the Securities Exchange Act of 1934
current.
In June 1999 Trinity American Corporation acquired the Note from
Sonos Management Corporation. The Company converted the
principal amount of the note and accrued interest to common stock
at a conversion rate of $0.0073 per share, or a total of
3,000,000. As a result of the transaction, Trinity American
Corporation acquired approximately 83.5% of the issued and
outstanding common stock of the Company. Trinity American
subsequently conveyed 2,850,000 of the shares to the persons
listed as principal shareholders under Item 11, above.
ITEM 13.
EXHIBITS AND REPORTS ON FORM 8-K
Copies of the following documents are included as exhibits
to this report pursuant to Item 601 of Regulation S-B.
Exhibits.
Exhibit SEC Ref. Title of Document Location*
No. No.
1 (3)(i) Articles of Incorporation E-1
2 (3)(ii) By-Laws E-6
3 (2) Articles of Merger E-14
4 (10) Promissory Note E-16
5 (27) Financial Data Schedules *
* The Financial Data Schedule is presented only in the
electronic filing with the Securities and Exchange Commission.
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FORM 8-K FILINGS
No reports on Form 8-K were filed in the last fiscal quarter of
1999.
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act,
the registrant caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
FASHION TECH INTERNATIONAL, INC.
Date: January 20, 2000 By: /s/ Pam Jowett, President
In accordance with the Exchange Act, this report has been
signed by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
Dated: January 20, 2000 /s/ Pam Jowett, Director
/s/ Paul W. Nielsen, Director
Dated: January 20, 2000
Dated: January 20, 2000 /s/ George R. Horton, Director
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FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
March 31, 1999
C O N T E N T S
Independent Auditors' Report F-2
Balance Sheet F-3
Statements of Operations F-4
Statements of Stockholders' Equity (Deficit) F-5
Statements of Cash Flows F-6
Notes to the Financial Statements F-7
F-1
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INDEPENDENT AUDITORS' REPORT
The Board of Directors
Fashion Tech International, Inc.
Salt Lake City, Utah
We have audited the accompanying balance sheet of Fashion
Tech International, Inc. (a development stage company) as of
March 31, 1999, and the related statements of operations,
stockholders' equity (deficit) and cash flows for the years
ended March 31, 1999 and 1998. These financial statements
are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about
whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts an disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial
position of Fashion Tech International, Inc. (a development
stage company) as of March 31, 1999, and the results of its
operations and its cash flows for the years ended March 31,
1999 and 1998 in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared
assuming that the Company will continue as a going concern.
As discussed in Note 2 to the financial statements, the
Company is a development stage company with no significant
operating results to date, which raises substantial doubt
about its ability to continue as a going concern.
Management's plans with regard to these matters are also
described in Note 2. The financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.
Jones, Jensen & Company
Salt Lake City, Utah
May 28, 1999
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<PAGE>
FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
Balance Sheet
ASSETS
March 31,
1999
CURRENT ASSETS
Cash $ 19,846
Total Current Assets 19,846
TOTAL ASSETS $ 19,846
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 6,401
Accrued interest 111
Notes payable (Note 3) 22,000
Total Current Liabilities 28,512
STOCKHOLDERS' EQUITY (DEFICIT)
Common stock authorized; 120,000,000 common
shares at $0.005 par value; 59,114,300 shares
issued and outstanding 295,571
Capital in excess of par value 236,034
Accumulated deficit prior to April 1, 1985 (413,549)
Deficit accumulated during the development stage (126,722)
Total Stockholders' Equity (Deficit) (8,666)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 19,846
The accompanying notes are an integral part of these financial
statements.
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<PAGE>
FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
Statements of Operations
From the
Beginning of
Development
Stage on
For the April 1, 1985
Years Ended Through
March 31, March 31,
1999 1998 1999
(Unaudited)
REVENUES $ - $ - $ -
EXPENSES 8,555 - 128,555
NET LOSS (8,555) - (128,555)
OTHER (EXPENSE) INCOME
Interest expense (111) - (111)
Gain on disposal of assets - - 1,944
Total Other (Expense) Income (111) - 1,833
NET LOSS $ (8,666) $ - $(126,722)
BASIC LOSS PER SHARE $ (0.00) $ (0.00)
WEIGHTED AVERAGE NUMBER
OF SHARES OUTSTANDING 59,114,300 59,114,300
The accompanying notes are an integral part of these financial
statements.
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<PAGE>
FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
Statements of Stockholders' Equity (Deficit)
Deficit
Accumulated
Capital in During the
Common Stock Excess of Development
Shares Amount Par Value Stage
Balance, March 31, 1985 18,306,300 $ 91,531 $236,034 $ (413,549)
November 5, 1985 shares
issued valued at par in
exchange for cash 10,800,000 54,000 - -
November 5, 1985 shares
returned to Company treasury
and canceled (2,000,000) (10,000) - -
November 26, 1985 shares
issued valued at par in
exchange for cash 8,000 40 - -
March 19, 1986 shares issued
at par for assets 8,000,000 40,000 - -
Net loss for the year ended
March 31, 1986 - - - -
Balance, March 31, 1986 35,114,300 175,571 236,034 (413,549)
June 13, 1986 shares issued
at par for services 2,000,000 10,000 - -
October 7, 1986 shares issued
at part in exchange for cash 22,000,000 110,000 - -
Net loss for the year ended
March 31, 1987 - - - (118,056)
Balance, March 31, 1987 59,114,300 295,571 236,034 (531,605)
Net loss for the years ended
March 31, 1988 through
March 31, 1997 - - - -
Balance, March 31, 1998 59,114,300 295,571 236,034 (531,605)
Net loss for the year ended
March 31, 1999 - - - (8,666)
Balance, March 31, 1999 59,114,300 $295,571 $ 236,034 $ (540,271)
The accompanying notes are an integral part of these financial
statements.
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<PAGE>
FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
Statements of Cash Flows
From the
Beginning of
Development
Stage on
For the April 1, 1985
Years Ended Through
March 31, March 31,
1999 1998 1999
(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss
Changes in operating asset
and liability accounts: $ (8,666) $ - $ (126,722)
Increase (decrease) in accounts payable 6,401 - 4,457
Increase (decrease) in accrued interest 111 - 111
Issuance of stock for services - - 10,000
Net Cash (Used) by Operating Activities (2,154) - (112,154)
CASH FLOWS FROM INVESTING ACTIVITIES - - -
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of stock for assets - - 40,000
Issuance of stock for cash - - 70,000
Increase in loans payable 22,000 - 22,000
Net Cash Provided by Financing
Activities 22,000 - 132,000
NET INCREASE (DECREASE) IN CASH 19,846 - 19,846
CASH AT BEGINNING OF PERIOD - - -
CASH AT END OF PERIOD $ 19,846 $ - $ 19,846
Cash Payments for:
Income taxes $ - $ - $ -
Interest $ - $ - $ -
The accompanying notes are an integral part of these financial
statements.
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<PAGE>
FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 1999 and 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Organization
Fashion Tech International, Inc. (the "Company") is a
Utah corporation organized on April 22, 1983 under the
named Portofino Investment, Inc. The name of the
Company was changed to Fashion Tech International, Inc.
on January 31, 1984. the Company was reclassified as a
development stage company as of March 31, 1998.
b. Account Method
The Company's financial statements are prepared using the
accrual method of accounting. The Company has adopted a
March 31 year end.
c. Basic Loss Per Share
The computations of basic loss per share of common stock
are based on the weighted average number of shares issued
and outstanding at the date of the financial statements.
d. Use of Estimates
The preparation of financial statements in conformity
with generally accepted accounting principles requires
management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the
date of the financial statement and the reported amounts
of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
e. Cash Equivalents
The Company considers all highly liquid investments with
a maturity of three months or less when purchased to be
cash equivalents.
f. Provision for Taxes
At March 31, 1999, the Company had net operating loss
carryforwards of approximately $125,000 that may be
offset against future taxable income through 2014. No
tax benefit has been reported in the financial
statements, because the potential tax benefits of the net
operating loss carryforwards are offset by a valuation
allowance of the same amount.
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<PAGE>
FASHION TECH INTERNATIONAL, INC.
(A Development Stage Company)
Notes to the Financial Statements
March 31, 1999 and 1998
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using
generally accepted accounting principles applicable to a
going concern which contemplates the realization of
assets and liquidation of liabilities in the normal
course of business. However, the Company does not have
significant cash or other material assets, nor does it
have an established source of revenues sufficient to
cover its operating costs and to allow it to continue as
a going concern. It is the intent of the Company to seek
a merger with an existing, operating company. In the
interim, shareholders of the Company have committed to
meeting its minimal operating expenses.
NOTE 3 - NOTE PAYABLE
As of March 31, 1999, the Company had a note payable for
$22,000 which bears interest at 8% and is due on demand.
Interest accrued for this note was $111 as of March 31,
1999.
NOTE 4 - SUBSEQUENT EVENT
In April 1999, the Company approved a 100-for-1 reverse
split of the Company's, issued and outstanding shares and
changed the par value to $0.001. The Company also
authorized 5,000,000 shares of preferred stock with a par
value of $0.001. At the same time the Company changed
its domicile from Utah to Nevada.
F-8
<PAGE>
Exhibit No. 1
Fashion Tech International, Inc.
Form 10-K
File No. 2-93231-NY
ARTICLES OF INCORPORATION
OF
FASHION TECH INTERNATIONAL, INC.
We, the undersigned. natural persons of twenty-one years
or more of age, acting as incorporators of a corporation (the
"Corporation") under the Nevada Revised Statutes adopt the
following Articles of Incorporation for the Corporation:
ARTICLE I
NAME OF CORPORATION
The name of the Corporation is PRESITGE CAPITAL CORPORATION.
ARTICLE II
DURATION
The Corporation shall exist perpetually or until dissolved
according to law.
ARTICLE III
PURPOSE
The purpose of the Corporation shall be to conduct any or
all lawful business for which corporations may be organized under
said Nevada Revised Statutes as from time to time authorized by
its Board of Directors, including but not limited to:
(a) To enter into any lawful arrangement for sharing
profits, union of interest, reciprocal association or cooperative
association with any corporation, association, partnership,
individual or other legal entity for the carrying on of any
business and to enter into any general or limited partnership for
the carrying on of any business; and
(b) To conduct business anywhere in the world.
In pursuit of this purpose, the Corporation will have all the
powers granted to it by law.
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<PAGE>
ARTICLE IV
SHARES
The aggregate number of shares which the Corporation
shall have authority to issue is 120,000,000 shares of common
stock having a par value of $0.001 per share The board of
directors of the Corporation may, from time to time, in their
sole discretion, prescribe and authorize the issuance of
additional classes and series of stock with distinguishing
designations and the number of each such class or series of
stock and the voting powers, designations, preferences,
limitations, restrictions and relative rights authorized. The
aggregate number of shares of stock, in addition to common
stock, the Corporation shall have authority to issue is
5,000,000 shares having $0.001 par value.
All voting rights appurtenant to shares of stock of the
Corporation shall be exercised by the holders of the common
stock. Each share of common stock shall be entitled to one
vote. All shares of common stock shall be of the same series
and shall entitle the holders thereof to equal rights in all
respects.
ARTICLE V
REGULATION OF INTERNAL AFFAIRS
Section 1. Shareholders' Meetings. Meetings of
shareholders may be called by the President or by any one
director or by any number of shareholders owning not less than
ten percent of the outstanding shares entitled to vote at such
meeting. Notice of shareholders' meetings shall be given in
writing by mailing such notice to the address of every
shareholder, at the last known address of such shareholder, at
least ten days prior to the date and hour of said meeting.
Publication of notice of a shareholders' meeting is not
required for any purpose. Any notice required to be given any
shareholders of this Corporation may be waived by written
instrument signed by such shareholders.
Section 2. Bylaws. Subject to repeal or change by action
of the shareholders, the majority of the directors may adopt
bylaws for the Corporation, and may alter, amend or repeal the
bylaws or adopt new bylaws, which are consistent with these
Articles and the laws of the State of Nevada.
ARTICLE VI
PREEMPTIVE RIGHTS
The shareholders of common stock of the Corporation shall
have no pre-emptive rights to acquire unissued shares of common
stock of the Corporation.
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<PAGE>
ARTICLE VII
REGISTERED OFFICE AND AGENT
The address of initial registered office of the
Corporation is One East First Street, Reno Nevada 89501 and the
name of its initial registered agent at such address is The
Corporation Trust Company of Nevada.
ARTICLE VIII
DIRECTORS
The number of directors which shall constitute the Board of
Directors of the Corporation shall be three or more unless the
number of shareholders is fewer than three, in which case the
number of directors may be the same as the number of
shareholders. The number of directors shall be fixed by the
bylaws. The number of directors constituting the initial Board
of Directors of the Corporation shall be three and the names and
addresses of the initial directors are:
Paul W. Nielsen 1118 8 South Woodfield Road
South Jordan, UT 84095
George R. Horton 1340 East 130 North
Springville, UT 84663
Glen R. Ulmner 2508 South 1300 East
Salt Lake City, UT 84106
ARTICLE IX
INDEMNIFICATION AND INSURANCE
(a) Right to Indemnification. Each person who was
or is a party or is threatened to be made a party to or
is involved in any action, suit or proceeding, whether
civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that
he or she, or a person of whom he or she is the legal
representative, is or was a Director or officer of the
Corporation or while serving as a Director or officer of
the Corporation is or was also serving at the request of
the Corporation as a director, officer, employee or agent
or another Corporation or of a partnership, joint
venture, trust or other enterprise, including service
with respect to employee benefit plans, shall be
indemnified and held harmless by the Corporation to the
fullest extent authorized by the Nevada Revised Statutes,
as the same exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that
such amendment permits the Corporation to provide broader
indemnification rights than said law permitted the
Corporation to provide prior to such amendment), against
all expense, liability and loss (including attorneys'
fees, judgements, fines, ERISA excise taxes or penalties
and amounts paid or to be paid in settlement) reasonably
incurred or suffered by such person in connection
therewith and such
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<PAGE>
indemnification shall continue as to a
person who has ceased to be a Director or officer and
shall inure to the benefit or his or her heirs, executors
and administrators; provided, however, that, except as
provided in paragraph (b) hereof, the Corporation shall
indemnify any such person seeking indemnification in
connection with a proceeding (or part thereof) initiated
by such person only if such proceeding (or party thereof)
was authorized by the Board of Directors of the
Corporation. The right to indemnification conferred in
this Section shall be a contract right (which may not be
reduced or limited by any repeal or modification of this
Article) and shall include the right to be paid by the
Corporation the expenses incurred in defending any such
proceeding in advance of its final disposition. The
Corporation may, by action of its Board of Directors,
provide indemnification to employees and agents of the
Corporation with the same scope and effect as the
foregoing indemnification of Directors and officers.
(b) Right of Claimant to Bring Suit. If a claim
under paragraph (a) of this section is not paid in full
by the Corporation within sixty days after a written
claim has been received by the Corporation, the claimant
may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim
and, if successful in whole or in party, the claimant
shall be entitled to be paid also the expense of
prosecuting such claim. Neither the failure of the
Corporation (including its Boars of Directors,
independent legal counsel, or its stockholders) to have
made a determination prior to the commencement of such
action that indemnification of the claimant is proper in
the circumstances because he or she has met any
applicable standard of conduct set forth in the Nevada
Revised Statutes nor an actual determination by the
Corporation (including its Board of Directors,
independent legal counsel, or its stockholders) that the
claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a presumption
that the claimant has not met the applicable standard of
conduct.
(c) Non-Exclusivity of Rights. The right to
indemnification and the payment of expenses incurred in
defending a proceeding in advance of its final
disposition conferred herein shall not be exclusive of
any other right which any person may have or hereafter
acquire under any statutes, provision of the Articles of
Incorporation, by-law, agreement, vote of stockholders or
disinterested Directors or otherwise.
(d) Insurance. The Corporation may maintain
insurance, at its expense, to protect itself and any
Director, officer, employee or agent of the Corporation
or another corporation, partnership, joint venture, trust
or other enterprise against any such expense, liability
or loss whether or note the Corporation would have the
power to indemnify such person against such expense,
liability or loss under the Nevada Revised Statutes.
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<PAGE>
ARTICLE X
INCORPORATORS
The name and address of each incorporator is:
NAME ADDRESS
Rand M. Elison 455 East 500 South, Suite 300
Salt Lake City, UT 84111
DATED this 15th day of December. 1998.
By: /s/ Rand M. Elison
STATE OF UTAH
)ss
COUNTY OF SALT LAKE
1, Elaine MacFarlane, a Notary Public, hereby certify that
on the 8th day of April, 1999 personally appeared before me Rand
M. Elison, who, being by me first duly sworn, declared that he
is the person who signed the foregoing Articles of Incorporation
as incorporator, and that the statements contained therein are
true.
Dated this 8th day of April, 1999.
By:/s/ Notary Public
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<PAGE>
Exhibit No. 2
Fashion Tech International, Inc.
Form 10-K
File No. 2-93231-NY
BYLAWS
OF
FASHION TECH INTERNATIONAL, INC.
ARTICLE I
OFFICES
The registered office of Fashion Tech International, Inc.
(the "Corporation") in the State of Nevada shall be at One East
First Street, Reno, Nevada and its registered agent at such
address shall be The Corporation Trust Company of Nevada.
ARTICLE 11
SHAREHOLDERS
Section 1. Annual Meeting. The annual meeting of the
shareholders shall be held on the 2nd Tuesday of the month of
March or such other day and month in each year as shall be
designated by the board of directors (unless that day is a legal
holiday, and then on the next succeeding day that is not a legal
holiday), beginning with the year 1999, at the hour of 10:00
a.m., for the purpose of electing directors and for the
transaction of such other business as may come before the
meeting. If the election of directors shall not be held on the
day designated herein for any annual meeting of the
shareholders, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special
meeting of the shareholders.
Section 2. Special Meeting. Special meetings of the
shareholders, for any purpose or purposes, may be called by the
President, Chairman of the Board, the board of directors, or by
any director, and shall be called by the President at the
request of the holders of not less than one-tenth of all the
outstanding shares of the Corporation entitled to vote at the
meeting.
Section 3. Place of Meeting. The place of meeting for
all annual meetings or for all special meetings shall be at
the Corporation's registered office, unless the board of
directors designates another place, either within or without
the State of Utah, or the United States of America.
Section 4. Notice of Meeting. Written or printed notice
stating the place, day, and hour of the meeting, and, in case of
a special meeting, the purpose or purposes for which the meeting
is called, shall be delivered not less than ten nor more than
fifty days before the date of the meeting, either personally or
by mail, by or at the direction of the President, the secretary,
or the officer or persons calling the meeting, to each
shareholder of record entitled to vote at such meeting. If
mailed, such notice shall be deemed delivered when deposited in
the United States mail addressed to the shareholder at his
address as it appears on the stock transfer books of the
Corporation, with postage thereon prepaid.
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<PAGE>
Section 5. Quorum. A majority of the outstanding shares
of the Corporation entitled to vote, represented in person or
by proxy, shall constitute a quorum at a meeting of
shareholders. If less than a majority of the outstanding
shares is represented at a meeting, a majority of the shares
so represented may adjourn the meeting from time to time
without further notice. At such adjourned meeting at which a
quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as
originally notified. The shareholders present at a duly
organized meeting may continue to transact business until
adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum. Shares shall not be
counted to make up a quorum for a meeting if voting of them at
the meeting has been enjoined or for any reason they cannot be
lawfully voted at the meeting.
Section 6. Proxies. At all meetings of shareholders, a
shareholder may vote by proxy executed in writing by the
shareholder. 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 7. Voting of Shares. Each outstanding share
entitled to vote shall be entitled to one vote upon each matter
submitted to a vote at a meeting of shareholders. If a quorum
is present, the affirmative vote of the majority of the shares
represented at the meeting and entitled to vote on the subject
shall be the act of the shareholders, unless the vote of a
greater number or voting by class is required by the Nevada
Revised Statutes or the Articles of Incorporation.
Section 8. Fixing Record Date for Meeting. The stock
transfer books of the Corporation shall not be closed for the
purpose of determining shareholders entitled to notice of or to
vote at a meeting of the shareholders but, in lieu thereof, the
date on which notice is given in accordance with Section 4 above
shall be the record date for those purposes. Such date shall not
be more than fifty nor less than ten days before the date of the
meeting. When a determination of shareholders entitled to vote
at any meeting of shareholders has been made under this section,
such determination shall apply to any adjournment thereof.
Section 9. Voting List. The officer or agent having charge
of the stock transfer books for shares of the Corporation shall
make, at least ten days before each meeting of shareholders a
complete list of the shareholders entitled to vote at such
meeting or any adjournment thereof, arranged in alphabetical
order, with the address of and the number of shares held by
each, which list, for a period of ten days prior to the meeting,
shall be kept on file at the registered office of the
Corporation and shall be subject to inspection by any
shareholder at any time during usual business hours. Such list
shall also be produced and kept open at the time and place of
the meeting and shall be subject to the inspection of any
shareholder 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.
Failure to comply with the requirements of this section
shall not affect the validity of any action taken at such
meeting.
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<PAGE>
Section 10. Informal Action by Shareholders. Any action
required to be taken at a meeting of the shareholders, or any
other action which may be taken at a meeting of the shareholders,
may be taken without a meeting if a consent in writing, setting
forth the action so taken, shall be signed by all of the
shareholders entitled to vote with respect to the subject matter
thereof.
ARTICLE III
BOARD OF DIRECTORS
Section 1. General Powers. The business and affairs of the
Corporation shall be managed by its Board of Directors. The
Board of Directors shall determine matters of corporate policy
and perform such duties as are required of it, by law.
Section 2. Consideration for Shares. Shares may be issued
for such consideration expressed in dollars, not less than the
par value thereof, as shall be fixed from time to time by the
Board of Directors.
The consideration for the issuance of shares may be paid,
in whole or in part, in money, promissory notes, or other
property, tangible or intangible, or in labor or services
actually performed or to be performed for the Corporation.
In the absence of fraud in the transaction, judgment of
the Board of Directors as to the value of the consideration
received for shares shall be conclusive.
Section 3. Number Tenure, and Qualifications. The number
of directors of the Corporation shall be three (3). Each
director shall hold office until the next annual meeting of
shareholders and until his successor shall have been elected.
Directors need not be residents of the State of Utah, citizens
of the United States, nor shareholders of the Corporation.
Section 4. Regular Meeting. A regular meeting of the Board
of Directors shall be held without other notice than this bylaw
immediately after, and at the same place as, the annual meeting
of shareholders. The Board of Directors shall provide, by
resolution, the time and place for the holding of regular
meetings, either within or without the State of Nevada, without
other notice than such resolution.
Section 5. Special Meetings. Special meetings of the
Board of Directors may be called by or at the request of the
President or any two directors. The person or persons
authorized to call special meetings of the Board of Directors
may fix any place, either within or without the State of
Nevada, as the place for the holding of any special meeting of
the Board of Directors called by them.
Section 6. Notice. Notice of any special meeting shall be
given at least ten (10) days previously thereto by written
notice delivered personally or mailed to each director at his
business address or by telegram. If mailed, notice shall be
deemed to be delivered when placed in the United States mail
or, if telegraphed the telegram is delivered to the telegraph
company. Any director may waive notice of any meeting. The
attendance of a director at a meeting shall
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<PAGE>
constitute a waiver
of notice of such meeting, except where a director attends a
meeting for the express purpose of objecting to the transaction
of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Board of
Directors need be specified in the notice or waiver of notice
of such meeting.
Section 7. Quorum. A majority of the number of directors
fixed by these bylaws shall constitute a quorum for the
transaction of business at any meeting of the Board of
Directors, but if less than such majority is present at a
meeting, a majority of the directors present may adjourn the
meeting from time to time without further notice.
Section 8. Manner of Acting; Minutes. The act of the
majority of the directors present at a meeting at which a quorum
is present shall be the act of the Board of Directors. Minutes
of the proceedings of Board of Directors' meetings shall be
prepared and shall be made available to shareholders.
Section 9. Vacancies. Any vacancy occurring in the Board of
Directors may be filled by the affirmative vote of a majority of
the remaining directors though less than a quorum of the Board
of Directors. A director elected to fill a vacancy shall be
elected for the unexpired term of his predecessor in office and
shall serve until his successor is duly chosen and qualified.
Any directorship to be filled by reason of an increase in the
number of directors shall be filled by election at an annual
meeting or at a special meeting of shareholders called for that
purpose, unless at such a meeting the shareholders delegate the
filling of such vacancy to the Board of Directors.
Section 10. 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 Secretary of the meeting before the adjournment
thereof or shall forward such dissent 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 11. Informal Action by Directors. Any action
required to be taken at a meeting of the directors, or any
action 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.
ARTICLE IV
OFFICERS
Section 1. Number. The officers of the Corporation shall be
a President, a Secretary and a Treasurer, each of whom shall be
elected by 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. Any person may hold two or
more offices except that the President shall not also be the
Secretary.
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<PAGE>
Section 2. Election and Term of Office. The officers of
the Corporation to be elected by the Board of Directors shall
be elected annually by the Board of Directors at the first
meeting of the Board of Directors held after each annual
meeting of the shareholders. Each officer shall hold office
until his successor shall have been duly elected or until his
death or until he shall resign or shall have been removed in
the manner hereinafter provided.
Section 3. Removal. Any officer or agent elected or
appointed by the Board of Directors may be removed by the Board
of Directors whenever in its judgment the best interests of the
Corporation would be served thereby, but such removal shall be
without prejudice to the contract rights, if any, of the person
so removed.
Section 4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification, or otherwise,
may be filled by the Board of Directors for the unexpired
portion of the term.
Section 5. President. The President shall be the principal
executive officer of the Corporation and, subject to the control
of the Board of Directors, shall in general supervise and
control all of the business and affairs of the Corporation. The
President shall have power to assign work, hire and discharge
employees, determine the compensation of employees, purchase
supplies, allocate vacation periods, grant leaves to employees,
collect outstanding accounts, borrow money in the ordinary
course of business, and to do all acts necessary to the conduct
of the business of the Corporation. He shall, when present,
preside at all meetings of the shareholders and of the Board of
Directors. He may sign, with the Secretary or any other proper
officer of the Corporation thereunto authorized by the Board of
Directors, certificates for shares of the Corporation, any
deeds, mortgages, bonds, contracts, or other instruments which
the Board of Directors has authorized to be executed, except in
cases where the signing and execution thereof shall be expressly
delegated by the Board of Directors or by these Bylaws to some
other officer or agent of the Corporation, or shall be required
by law to be otherwise signed or executed; and in general shall
perform all duties as may be prescribed by the Board of
Directors from time to time.
Section 6. Secretary. The
Secretary shall:
(a) keep the minutes of the shareholders' and of
the Board of Directors' meetings in one or more books
provided for that purpose;
(b) see that all notices are duly given in
accordance with the provisions of these Bylaws or as
required by law;
(c) be custodian of the corporate records and of the
seal of the Corporation and see that the seal of the
Corporation is affixed to all documents the execution of
which on behalf of the Corporation under its seal is duly
authorized;
(d) keep a register of the post office address of
each shareholder which shall be furnished to the Secretary
by such shareholder;
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(e) sign with the President certificates for shares
of the Corporation, the issuance of which shall have
been authorized by resolution of the Board of Directors;
(f) have general charge of the stock record books of
the Corporation; and
(g) in general perform all duties incident to the
office of Secretary and such other duties as from time to
time may be assigned to him by the President or the Board of
Directors.
Section 7. Treasurer. If required by the Board of
Directors, the Treasurer shall give a bond for the faithful
discharge of his duties in such sum and with such surety or
sureties as the Board of Directors shall determine. He shall
have charge and custody of and be responsible for all funds and
securities of the Corporation; receive and give receipts for
monies due and payable to the Corporation from any source
whatsoever,. and deposit all such monies in the name of the
Corporation in such banks, trust companies or other depositories
as shall be selected in accordance with the provisions of
Article V of these Bylaws.
Section 9. Salaries. The salaries of the officers shall be
fixed from time to time by the Board of Directors, and no
officer shall be prevented from receiving such salary by reason
of the fact that he is also a director of the Corporation.
ARTICLE V
CONTRACTS, LOANS, CHECKS, AND DEPOSITS
Section 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 2. Loans. No loan shall be contracted on behalf
of the Corporation and no evidence of indebtedness shall be
issued in its name unless authorized by a resolution of the
Board of Directors. Such authority may be general or
confined to specific instances.
Section 3. Checks, Drafts, etc. All checks, drafts, or
other orders for the payment of money, notes, or other evidences
of indebtedness issued in the name of the Corporation shall be
signed by such officer or officers, agent or agents, of the
Corporation and in such manner as shall from time to time be
determined by resolution of the Board of Directors.
Section 4. 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.
ARTICLE VI
CERTIFICATES FOR SHARES AND THEIR TRANSFER
Section 1. Certification for Shares. Certificates
representing shares of the Corporation shall be in such form as
shall be determined by the Board of Directors-. Such
certificates
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<PAGE>
shall be signed by the President or Vice President
and by the Secretary. 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 record books of the Corporation. All
certificates surrendered to the Corporation for transfer, shall
be canceled and no new certificates 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 2. Transfer of Shares. Transfer of shares of the
Corporation shall be made only on the stock record 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.
ARTICLE VII
ACCOUNTING
Full and accurate books of account shall be kept in
accordance with good accounting practices. Such books of
account shall be available for inspection by any shareholder at
all reasonable times. All corporate purchases shall be made on
account and all accounts shall be paid by check. So far as
possible, no cash outlays shall be made.
The fiscal year of the Corporation shall begin on the 1st
day of January and end on the 31st day of December in each
year.
ARTICLE VIII
DIVIDENDS
The Board of Directors may from time to time declare, and
the Corporation may pay, dividends on its outstanding shares in
the manner and, upon the terms and conditions provided by law
and its articles of incorporation.
ARTICLE IX
SEAL
The Board of Directors shall provide a corporate seal
which shall be circular in form and shall have inscribed
thereon the name of the Corporation, the state of incorporation
and the words "Corporate Seal."
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<PAGE>
ARTICLE X
WAIVER OF NOTICE
Whenever any notice is required to be given to any
shareholder or director of the Corporation under the provisions
of these Bylaws or under the provisions of the articles of
incorporation, a waiver thereof in writing, signed by the person
or persons entitled to such notice, whether before or after the
time stated therein, shall be deemed equivalent to the giving of
such notice.
ARTICLE XI
AMENDMENTS
These Bylaws may be amended or repealed by the Board of
Directors at any meeting or by the shareholders at any meeting.
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<PAGE>
Exhibit No. 3
Fashion Tech International, Inc.
Form 10-K
File No. 2-93231-NY
ARTICLES OF MERGER
of
FASHION TECH INTERNATIONAL, INC. (a Utah Corporation)
into
FASHION TECH INTERNATIONAL, INC. (a Nevada Corporation)
The undersigned, in their capacities as President and Secretary,
respectively, of Fashion Tech International, Inc. ( a Nevada
Corporation, hereinafter sometimes referred to as ("Fashion Tech,
Nevada," or "Survivor,") and Fashion Tech International, Inc. (a Utah
corporation hereinafter sometimes referred to as "Fashion Tech Utah")
in order to consummate the merger of Fashion Tech Utah into Fashion
Tech Nevada hereby attest and certify as follows:
I. The names and states of incorporation of the two constituent
corporations to the merger
are specified above. Fashion Tech Nevada was incorporated in the
State of Nevada on April 16, 1999, for the sole purpose of being the
surviving corporation in a merger effectuated to
change the corporate domicile of Fashion Tech Utah.
II. Articles of Merger of the constituent corporations were, adopted
by each of the
constituent corporations on April 28, 1999, in accordance with all
relevant provisions of the
Nevada Revised Statutes and all the relevant provisions of the Utah
Revised Business
Corporation Act.
III. The surviving corporation is Fashion Tech International, Inc., a
Nevada Corporation.
IV. The Articles of Incorporation of Fashion Tech International
Nevada shall be the Articles of Incorporation of Survivor.
V. The Plan of Merger for the constituent corporations provides
that Fashion Tech Utah shall be merged into Fashion Tech Nevada, the
manner and that the basis of converting the issued shares of Fashion
Tech Utah into share of Fashion Tech Nevada shall be as follows:
(a) The total shares represented by each outstanding Fashion
Tech Utah common stock certificate (following a 100 for 1 reverse
split of Fashion Tech Utah's shares approved at a meeting of the
Fashion Tech Utah's shareholders held on April 28, 1999) shall be
deemed to be automatically converted into one share of common stock,
par value $0.001 per share of Survivor.
(b) Holders of Fashion Tech Utah certificates issued prior to
the merger shall not be required to surrender such certificates for
conversion into certificates reflecting the SURVIVOR's name, but may
do so to SURVIVOR's duly appointed transfer agent, American Registrar
& Transfer,
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<PAGE>
10 Exchange Place, Suite 705, Salt Lake City, UT 84111
which shall, in the ordinary course of its business and the payment
of $15.00 per new certificate to be issued (and provided that its
regular and usual requirements regarding negotiability and payment of
its fees are met) reissue certificates representing the number of
shares in SURVIVOR to which said holders may be entitled as provided
above.
VI. The principal business office of SURVIVOR is located at 1340
East 130 North,
Springville, UT 84663, and a complete copy of the executed agreement
of merger is on file at
said office. A copy of the plan of merger will be furnished by the
SURVIVOR, on request, and
without cost, to any stockholder of any corporation which is a party
the merger.
VII. The Plan of Merger was adopted by the directors and submitted to
and approved by the shareholders of both constituent corporations,
Fashion Tech Utah having 59,114,301 share of common stock outstanding
and entitled to vote (its sole voting group), 38,785,500 of which
were represented at the meeting to approve the Plan of Merger. All
of the shares represented at the meeting were voted in favor of the
Plan of Merger and none were voted against the merger. SURVIVOR had
1,000 shares of common stock outstanding and entitled to vote (its
sole voting group) all of which were represented at the meeting to
approve the Plan of merger and all 1,000 of which shares were voted
in favor of the Plan of Merger. The number of shares voted in favor
of the Plan of Merger by the stockholders was sufficient for approval
by said stockholder of each of the constituent corporations.
IN WITNESS WHEREOF, the undersigned Presidents and Secretaries of
Fashion Tech Utah and Fashion Tech Nevada. have set their hands this
28th day of April, 1999.
FASHION TECH INTERNATIONAL, INC. FASHION TECH INTERNATIONAL, INC.
(a Utah Corporation) (a Nevada Corporation)
By: /s/ Glen R. Ulmner By: /s/ Glen R. Ulmner
Its President Its President
By: George R. Horton By: George R. Horton
Its Secretary Its Secretary
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<PAGE>
Exhibit No. 4
Fashion Tech International, Inc.
Form 10-K
File No. 2-93231-NY
$22,000.00 04/12/1999
Fashion Tech International, Inc., after date, for value
received, I/we jointly and severally, promise to pay to
SONOS MANAGEMENT CORPORATION or order Twenty Two Thousand
and no/100 DOLLARS with interest payable when due at the
rate of 8 percent per annum form 04-12-99 until paid, both
before and after judgment. And we hereby agree, that in
case this note after maturity, is referred to an attorney,
either with or without suit, to pay a reasonable attorney's
fee. The holder shall have the right to declare this note
due for default in payment of interest.
Fashion Tech International, Inc.
By: /s/
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<PAGE>
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