U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For Fiscal Year Ended: December 31, 1996
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from To
Commission file number 0-18834
Klever Marketing, Inc.
(Name of small business issuer in its charter)
Delaware 36-3688583
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
350 West 300 South, Suite 201, Salt Lake City, Utah 84101
(Address of principal executive offices) (zip code)
Issuer's telephone number (801) 322-1221
Securities registered under Section 12(b) of the Act: NONE
Securities registered under Section 12(g) of the Act:
Common Stock Par Value $0.01
(Title of class)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes No X
Total pages: 19
Exhibit Index Page: 18
Check if there is no disclosure of delinquent filers pursuant to Item 405
of Regulation S-B is not contained 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. [ ]
State issuer's revenues for its most recent fiscal year. $ -0-
As of May 23, 1997, there were 9,443,513 shares of the Registrant's
common stock, par value $0.01, issued and outstanding. The aggregate market
value of the Registrant's voting stock held by non-affiliates of the
Registrant was approximately $ 5,380,659 computed at the average bid and asked
price as of May 23, 1997.
DOCUMENTS INCORPORATED BY REFERENCE
If the following documents are incorporated by reference, briefly
describe them and identify the part of the Form 10-KSB (e.g., Part I, Part II,
etc.) into which the document is incorporated: (1) any annual report to
security holders; (2) any proxy or information statement; and (3) any
prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933
("Securities Act"): NONE
Transitional Small Business Disclosure Format (check one):
Yes ; NO X
TABLE OF CONTENTS
Item Number and
Caption Page
PART I
Item 1. Description of Business . . . . . . . . . . . . . . . . . . . 4
Item 2. Description of Property . . . . . . . . . . . . . . . . . . . 4
Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . 5
Item 4. Submission of Matters to a Vote of Security Holders . . . . . 5
PART II
Item 5. Market for Common Equity and Related Stockholder Matters. . . 6
Item 6. Management's Discussion and Analysis or Plan of Operations. . 11
Item 7. Financial Statements . . . . . . . . . . . . . . . . . . . . 12
Item 8. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure . . . . . . . . . . . . . . . . . . . . 12
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act. . . . . . 13
Item 10. Executive Compensation. . . . . . . . . . . . . . . . . . . . 14
Item 11. Security Ownership of Certain Beneficial Owners and Management 15
Item 12. Certain Relationships and Related Transactions. . . . . . . . 17
Item 13. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . 18
PART I
ITEM 1 DESCRIPTION OF BUSINESS
General
The Company was formed for the purpose of creating a vehicle to obtain
capital, to file and acquire patents, to seek out, investigate, develop,
manufacture and market electronic in-store advertising, directory and coupon
services which have potential for profit. The Company is currently in the
process of the commercialization of the patented process it has acquired.
History
The company began as a part of Information Resources, inc. ("IRI") in
1987, was incorporated as a subsidiary of IRI under the laws of the State of
Delaware on December 8, 1989, and was fully distributed to stockholders of IRI
in a spinoff on October 31, 1990. At the time of the spinoff a portion of the
business and assets of the Company included a software operation in Australia,
which was sold in March, 1993. The Company filed petitions for relief under
Chapter 11 bankruptcy. The Company was inactive until July 5, 1996 when the
Company merged with Klever Kart, Inc. in a reverse merger and changed its name
to Klever Marketing, Inc. The Company is in the development stage as of
December 31, 1996, and has not commenced planned principal operations.
ITEM 2 DESCRIPTION OF PROPERTY
On June 1, 1994, the Company entered into a six year commercial lease of
office space with Tree of stars, Inc./P.D.O. ( major shareholder of the
Company) . The office space is used as the Corporate headquarters and is
located at 350 West 300 South, suite 201, Salt Lake City, Utah. The lease
provides for rental payments of $22,428 for two years, increasing to $25,726
for an additional two years with a provision for a review of the rental
payment requirements every two years thereafter.
ITEM 3 LEGAL PROCEEDINGS
NONE
ITEM 4 SUBMISSION OF MATTERS TO A
VOTE OF SECURITY HOLDERS
NONE
PART II
ITEM 5 MARKET FOR COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
The stock is traded OTC with the trading symbol KLMK.
The following table set forth the high and low bid of the Company's
Common Stock for each quarter within the past two years and through the first
quarter 1997. The information below was provided by Olsen Payne and Company
and reflects inter-dealer prices, without retail mark-up, mark-down or
commission and may not represent actual transactions:
1995: High Low
First quarter (To managements knowledge, there was no trading
Second Quarter during 1995 and the first three quarters of 1996)
Third Quarter
Fourth Quarter
1996:
First Quarter
Second Quarter
Third Quarter
Fourth Quarter $ .01 $ .01
1997:
First Quarter $ .01 $ .01
Second Quarter $ 2.00 $ .07
The number of shareholders of record of the Company's common stock as of
May 23, 1997 was 709.
The Company has not paid any cash dividends to date and does not
anticipate paying dividends in the foreseeable future. It is the present
intention of management to utilize all available funds for the development of
the Company's business.
Recent Sales of Unregistered Securities.
The Company over the past three years has sold 1,816,279 shares of common
stock. The stock was not sold through an underwriter and was not sold through
a public offer. A summary of the transactions follows:
Common Stock
Shares Amount
February 8, 1994 shares issued
to Corporation and Individuals
for cash at $1.00 per share 24,000 $ 24,000
February 8, 1994 shares issued
to a related Corporations,
Tree of Stars, Inc. for cash
at $1.00 per share 8,000 8,000
March 9, 1994 shares issued
to a company in exchange for
services at $1.00 per share 26,147 26,147
September 1, 1994 shares issued
to an individual for cash
at $1.25 per share 22,400 28,000
September 14, 1994 shares issued
to individuals and a corporation
for cash and cancellation of debt
at $1.00 to $1.33 per share 231,200 237,750
October 21, 1994 shares issued
to an individual for cash
at $1.25 per share 18,750 23,438
November 16, 1994 shares issued
to an individual for cash
At $1.00 per share 3,500 3,500
November 30, 1994 shares issued
to an individual for cash
At $1.00 to $1.50 per share 106,666 140,000
December 7, 1994 shares issued
to a corporation in exchange
for services at $1.00 per share 10,000 10,000
December 9, 1994 shares issued
to a corporation for cash
at $1.50 per share 20,000 30,000
December 31, 1994 shares issued
to Individuals in exchange for
for services at $1.34 to $1.36
per share 6,815 9,190
Common Stock
Shares Amount
January 15, 1995 shares issued
to an individual for cash at
$1.50 per share 10,000 $ 15,000
February 1995 shares issued
to an individual for cash at
$1.25 per share 18,000 22,500
March 15, 1995 shares issued
to individuals for cash at
$1.25 per share 120,000 150,000
April 25, 1995 shares issued
to a corporation for cash at
$1.00 per share 125,000 125,000
May 10, 1995 shares issued
to an individual for cash at
$1.00 per share 50,000 50,000
June, 1995 shares issued
to individuals for cash and
services at $1.25 per share 66,000 82,500
June 30, 1995 shares issued
to an individual for services
at $1.50 per share 1,400 2,100
July 12, 1995 shares issued
to a corporation for cash at
$2.00 per share 30,000 60,000
July 20, 1995 shares issued
to a corporation for cash at
$2.00 per share 14,000 21,000
August 15, 1995 shares issued
to an individual for cash at
$1.25 per share 40,000 50,000
September, 1995 shares issued
to individuals for cash at
$1.25 per share 44,667 82,000
October, 1995 shares issued
to individuals for cash at
$1.50 - $3.00 per share 19,333 44,000
November, 1995 shares issued
to individuals for cash at
$.83 - $1.50 per share 13,000 16,165
Common Stock
Shares Amount
December, 1995 shares issued
to individuals for cash and
services at $1.25 - $3.00
per share 63,153 $ 124,230
January 1996 shares issued
to individuals for cash at
$2.50 - 3.00 per share 3,500 8,000
March 1996 shares issued
to an individual and
a company for cash
at $2.00 - $3.00 per share 21,240 43,479
April 1996 shares issued
to individuals for cash
at $.50 - 2.04 per share 63,000 74,000
May 1996 shares issued to
individuals for cash
at $3.00 per share 9,000 27,000
May 1996 shares issued to
individuals for legal
services at $3.00 per share 1,463 4,389
June 1996 shares issued to a
company in exercise of
an option at $1.00 per share 100,000 100,000
June 1996 shares issued to a
related company (Maktoob, Inc.)
for cash at $1.25 per share 30,000 37,500
June 1996 shares issued to an
individual for cash at
$3.00 per share 5,000 15,000
November 15, 1996, shares
issued to individuals
for cash at $1.29 - 2.59
per share 40,569 67,500
November 27, 1996, shares
issued to officer for
cash at $2.94 per share 2,891 8,499
Common Stock
Shares Amount
December 13, 1996, shares
issued to individuals
for cash and receivables
at $1.00 - 3.00 per share 107,624 $ 188,208
December 13, 1996, shares
issued to a company for
services at $1.25 per share 14,282 17,853
December 19, 1996, shares
issued to individual to
exercise option at $1.25
per share 30,000 37,500
December 19, 1996, shares
issued to individual for
cash at $1.25 per share 30,000 37,500
December 31, 1996, shares
issued to individual
for receivable at
$1.00 - 3.00 per share 40,679 101,950
December 31, 1996, shares
issued to officer and
employee for patents 225,000 132,750
Total 1,816,279 $2,285,648
These sales are exempt under Regulation D Rule 506 of the Securities Act
of 1933.
ITEM 6 MANAGEMENT'S DISCUSSION AND
ANALYSIS OR PLAN OF OPERATIONS
Plan of Operations - The Company was formed for the purpose of creating a
vehicle to obtain capital, to file and acquire patents, to seek out,
investigate develop, manufacture and market electronic in-store advertising,
directory and electronic coupon services which have potential for profit. The
Company is currently in the process of the commercialization of the patented
process ("Klever Marketing System") it has acquired.
In June, 1997, the company is scheduled to begin the product movement
test, a 90 day trial of the Klever Marketing System, which will end in
September 1997. The Company also plans to negotiate a contract for the
development of the Electronic Coupon system, which development is estimated to
be completed in January 1998.
In October 1997, the product movement test is scheduled to begin in Japan
and continue through December 1997.
In February 1998, the Company has scheduled to begin installation of the
Klever Marketing System in 50 Smiths Food & Drug Stores, which is estimated to
continue through May 1998. Also in February 1998, the Company is scheduled to
begin installation of the first Electronic Coupon test store which will
continue through June 1998.
In order to satisfy its cash requirements, the company will have to raise
additional funds through the sale of restricted stock and short term
borrowings..
The company estimated that it may need to hire 5 or 6 additional
employees during the next 12 months.
Results of Operations - The Company was inactive until July 5, 1996 when the
Company merged with Klever Kart, Inc. in a reverse merger and changed its name
to Klever Marketing, Inc. The Company is in the development stage as of
December 31, 1996, and has not commenced planned principal operations.
Liquidity and Capital Resources - The Company requires working capital
principally to fund its current research and development and operating
expenses for which the Company has relied on short-term borrowings and the
issuance of restricted common stock. There are no formal commitments from
banks or other lending sources for lines of credit or similar short-term
borrowings, but the Company has been able to borrow any additional working
capital that has been required. From time to time in the past, required
short-term borrowings have been obtained from a principal shareholder or other
related entities.
Cash flows. Operating activities used cash of $617,000 and $731,000 for
1996 and 1995, respectively. The decrease in the use of cash is due primarily
to a reduction in research and development costs as the products is nearing
completion.
Investing activities have used cash of $50,000 and $49,000 for 1996 and
1995, respectively. Investing activities primarily represent purchases of
patents relating to the electronic in-store advertising, directory and coupon
devices, and purchases of office equipment.
Financing activities provided cash of $672,000 and $779,000 for 1996 and
1995, respectively. Financing activities primarily represent sales of the
Company's restricted stock.
ITEM 7 FINANCIAL STATEMENTS
The financial statements of the Company and supplementary data are
included beginning immediately following the signature page to this report.
See Item 13 for a list of the financial statements and financial statement
schedules included.
ITEM 8 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
There are not and have not been any disagreements between the Company and
its accountants on any matter of accounting principles, practices or financial
statements disclosure.
PART III
ITEM 9 DIRECTORS EXECUTIVE OFFICERS, PROMOTERS AND
CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF
THE EXCHANGE ACT
Executive Officers and Directors
The following table sets forth the name, age, and position of each
executive officer and director of the Company:
Director's Name Age Office Term Expires
Paul G. Begum 58 President/CEO October 1997
William Bailey 62 Director October 1997
Peter D. Olsen 58 Director October 1997
Paul G. Begum, age 58, has been the President/CEO of Klever Kart, Inc.
for the past five years through the merger date, and is now the President/CEO
of the Company after the merger. Mr. Begum was also the President/CEO of Hi,
Tiger International from February 14, 1995 through October 1996, and the
President of Tree of Stars, Inc., a private company, and Maktoob Inc., a
private company, for all of the past five years to the present
William Bailey, age 62, has been a Director of Klever Kart, Inc. for the
past five years through the merger date, and is now a Director of the Company
after the merger. Mr. Bailey has also been the President/CEO of Mount Olympus
Water, a private company, during all of the past five years to present.
Peter D. Olson, age 58, has been a Director of Klever Kart, Inc. for the
past five years through the merger date, and is now a Director of the Company
after the merger. Mr. Olson has also been the President/CEO of Olson Farms, a
private company, during all of the past five years to present.
ITEM 10 EXECUTIVE COMPENSATION
Summary Compensation
The following table set forth, for the last three fiscal years, the
annual and long term compensation earned by, awarded to, or paid to the person
who was chief executive officer at any time during the last fiscal year.
---Long Term Compensation---
-Annual Compensation- -------Awards------ -Payouts-
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other Securities
Year Annual Restricted Underlying All Other
Ended Compen- Stock Options/ LTIP Compen-
Name and Dec. Salary Bonus sation Award(s) SAR's Payouts sation
Principal 31 ($)(1) ($) ($) ($) (no.) ($) ($)
Position
Paul G. Begum 1996 $72,000 - - - - - -
President/CEO 1995 $48,000 - - - - - -
1994 $48,000 - - - - - -
Options/SAR Grants in Last Fiscal Year
The following table sets forth information respecting all individual
grants of options and SARs made during the last completed fiscal year by the
chief executive officer of the Company.
(a) (b) (c) (d) (e)
Number of % of Total
Securities Options/SARs
Underlying Granted to
Options/SAR's Employees During Exercise or Base
Name Granted (no.) Fiscal Year Price ($/share) Expiration Date
Paul G. Begum 5,000/-- 5.05% $3.00 08/07/99
President/CEO
Aggregate Option/SAR Exercises in the Last Fiscal Year and year End Option/SAR
Values
The following table sets forth information respecting the exercise of
options and SARs during the last completed fiscal year by the chief executive
officer of the Company and the fiscal year end valued of unexercised options
and SARs.
(a) (b) (c) (d) (e)
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs Options/SARs
at FY End (no.) at FY End ($)
Shares Acquired Exercisable/ Exercisable/
Name On Exercise (no.) Value Realized ($) Unexercised Unexercised
Paul G. Begum -- -- 726,000(1) $ 2,178,000(2)
President/CEO
(1) Mr. Begum's ownership includes options to purchase 1,000 shares held by
Tree of Stars, Inc., a corporation of which Mr. Begum is a director,
officer, and principal shareholder.
(2) Based on recent sales of the company's stock at $3.00 per share.
Executive Compensation and Benefits
The Company provides to all of its full time employees, including
executive officers and directors, health insurance and miscellaneous other
benefits.
On July 7, 1992, the board of directors approved a resolution that
Klever-Kart, Inc. will obtain an automobile for Paul G. Begum once Klever-Kart
became funded. The board has now clarified such resolution and has determined
that once the Company has received $2,000,000 in financing from investors
introduced to the company by Mr. Begum, the Company will incur monthly
lease/payment costs of approximately $500 for an automobile for Mr. Begum.
ITEM 11 SECURITY OWNERSHIP OF BENEFICIAL OWNERS
AND MANAGEMENT
Principal Shareholders
The table below sets forth information as to each person owning of record
or who was known by the Company to own beneficially more than 5% of the
9,443,513 shares of issued and outstanding Common Stock, including options to
acquire stock of the Company as of May 23, 1997 and information as to the
ownership of the Company's Stock by each of its directors and executive
officers and by the directors and executive officers as a group. Except as
otherwise indicated, all shares are owned directly, and the persons named in
the table have sole voting and investment power with respect to shares shown
as beneficially owned by them.
# of
Name and Address Nature of Shares
of Beneficial Owners Ownership Owned Percent
and Directors
Principal Shareholders
Tree of Stars, Inc. Direct 2,819,110 29.85%
Options 1,000 .01%
Total 2,820,110 29.86%
Peter D. Olson Direct(1) 1,286,592 13.62%
Options 266,000 2.82%
Total 1,552,592 16.44%
C. Terry Warner Direct 917,885 10.45%
Directors and Executive Officers
Paul G. Begum Direct(2) 2,819,110 29.85%
Options(2) 726,000 7.69%
Total 3,545,110 37.54%
William Bailey Direct(3) 164,100 1.74%
Options 31,000 .33%
Total 195,100 2.07%
Peter D. Olson --------------- See Above -------------
All Executive Officers and
Directors as a Group (3
persons) Direct 4,269,802 45.21%
Options 1,023,000 10.83%
Total 5,292,802 56.04%
(1) Mr. Olson's ownership includes 577,265 shares held by Olson Farms, Inc., a
family owned corporation.
(2) Mr. Begum's ownership includes 2,819,110 shares and options to purchase
1,000 shares held by Tree of Stars, Inc., a corporation of which Mr. Begum
is a director, officer, and principal shareholder.
(3) Mr. Bailey's ownership includes 20,285 shares held by William C. Bailey
Family Partnership.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
During 1996 and 1995 various officers and directors have loaned the
Company $33,500 and $25,000, respectively. The notes are payable on demand
plus interest at 10% per annum. During 1996 and 1995 principle payments of
$46,041 and $59,128 were paid toward these loans. The balance due as of
December 31, 1996 is as follows:
Principal Interest
Tree of Stars, Inc. $ 6,365 $ 136
Paul G. Begum 6,366 256
William Bailey 5,000 434
Peter D. Olson 5,000 428
Tree of Stars/PDO, Inc. 4,417 99
Total $ 27,148 $ 1,353
Accrued compensation due to Mr. Paul G. Begum as of December 31, 1996 was
$48,000.
ITEM 13. EXHIBITS, AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report.
1. Financial Statements Page
Report of Robison, Hill & Co.,
Independent Certified Public Accountants F-1
Balance Sheets as of December 31, 1996, and 1995 F-2
Statements of Operations for the years ended
December 31, 1996, and 1995 F-4
Statement of Stockholders' Equity for the years ended
December 31, 1996, and 1995 F-5
Statements of Cash Flows for the years ended
December 31, 1996, and 1995 F-10
Notes to Financial Statements F-12
2. Financial Statement Schedules
All schedules are omitted because they are not applicable or the required
information is shown in the financial statements or notes thereto.
3. Exhibits
The following exhibits are included as part of this report:
Exhibit
Number Title of Document
3.01 Articles of Incorporation of Klever Marketing, Inc.
a Delaware Corporation
3.02 Bylaws
23.01 Consent of Accountants
(b) No reports on Form 8-K were filed.
SIGNATURES
Pursuant to the requirements of section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to
be signed on it behalf by the undersigned, thereunto duly authorized.
KLEVER MARKETING, INC.
Dated: June 19, 1997 By /S/ Paul G. Begum
Paul G. Begum
President, C.E.O., Chairman, Director
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf
of the Registrant and in the capacities indicated on this 19th day of June
1997.
Signatures Title
/S/ Paul G. Begum
Paul G. Begum President, C.E.O., Chairman, Director
(Principal Executive, Financial
and Accounting Officer)
/S/ William C. Bailey
William C. Bailey Director
/S/ Peter D. Olson
Peter D. Olson . Director
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Klever Marketing, Inc.
(Formerly VideOcart, Inc.)
Salt Lake City, Utah
Gentlemen:
We have audited the accompanying balance sheets of Klever Marketing, Inc.
(Formerly VideOcart, Inc.), (a development stage company) as of December 31,
1996 and 1995, and the related statements of operations, changes in
stockholders' equity and cash flows for the two years then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Klever Marketing,
Inc. (Formerly VideOcart, Inc.), (a development stage company), as of December
31, 1996 and 1995, and the results of its operations and its cash flows for
the two years then ended in conformity with generally accepted accounting
principles.
Respectfully submitted,
/S/ Robison, Hill & Co
Certified Public Accountants
Salt Lake City, Utah
March 3, 1997
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.
(A Development Stage Company)
BALANCE SHEET
DECEMBER 31
ASSETS 1996 1995
Current Assets
Cash $ 29,452 $ 24,674
Shareholder Receivables 57,500 -
Total Current Assets 86,952 24,674
Fixed Assets
Equipment 52,262 47,462
Less Accumulated Depreciation (29,225) (17,670)
Net Fixed Assets 23,037 29,792
Other Assets
Patents 1,623,386 1,445,146
Organization Costs 152,662 152,662
Less Accumulated Amortization (839,812) (690,748)
Net Other Assets 936,236 907,060
Total Assets $ 1,046,225 $ 961,526
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable, Trade $ 111,714 $ 95,821
Accrued Liabilities 34,200 33,460
Related Party Payables 50,166 50,166
Lease Obligation 4,479 8,186
Total Current Liabilities 200,559 187,633
Other
Deferred Income 229,000 214,000
Notes Payable - Related Party 27,148 39,689
Total Other Liabilities 256,148 253,689
Total Liabilities 456,707 441,322
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
BALANCE SHEET
(Continued)
DECEMBER 31
LIABILITIES AND STOCKHOLDERS' EQUITY 1996 1995
(Continued)
Stockholders' Equity
Preferred stock (par value $.01),
2,000,000 shares authorized.
-0- issued and outstanding $ - $ -
Common Stock (Par Value $.01),
20,000,000 shares authorized.
9,050,607 shares issued and out-
standing December 31, 1996 and
8,592,038 shares issued and out-
standing December 31, 1995 90,506 85,920
Common Stock to be issued 6,057 3,400
Paid in Capital in Excess of Par
Value 4,658,554 3,764,669
Retained Deficit (3,333,785) (3,333,785)
Deficit Accumulated During the
Development Stage (831,814) -
Total Stockholders' Equity 589,518 520,204
Total Liabilities and
Stockholders' Equity $ 1,046,225 $ 961,526
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
STATEMENT OF OPERATIONS
Cumulative
For the Year Ended During
December 31, Development
1996 1995 Stage
Revenue $ - $ - $ -
Total Revenue - - -
Expenses
General and Administrative 541,377 525,225 541,377
Research and Development 280,837 772,989 280,837
Total Expenses 822,214 1,298,214 822,214
Other Income (Expense)
Interest Income - 1,377 -
Interest Expense (9,500) (12,591) (9,500)
Sale of Assets - - -
(9,500) (11,214) (9,500)
Income (Loss) Before Taxes (831,714) (1,309,428) (831,714)
Income Taxes 100 100 100
Net Income (Loss) After Taxes $ (831,814) $(1,309,528) $ (831,814)
Weighted Average Shares
Outstanding 8,741,148 8,320,387
Loss Per Share $ (.10) $ (.16)
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
Deficit
Accumulated
Paid in During
the
Common Stock Capital in During Develop
Preferred Stock Common Stock to be issued Excess of Retained -ment
Shares Amount Shares Amount Shares Amount Par Value Deficit Stage
Balance at
December 31, 1994
247,100 $ 2,471 12,210,949 $122,109 $ - $ - $74,022,028$(103,351,248)$ -
Shares issued in
connection with
merger (see Note 8)
(247,100) (2,471)(4,233,464) (42,334) 340,000 3,400 (71,250,709) 101,326,991 -
January 15, 1995 shares
issued to an indiv-
idual for cash at
$1.50 per share
- - 10,000 100 - - 14,900 - -
February 1995 shares
issued to an indiv-
idual for cash at
$1.25 per share
- - 18,000 180 - - 22,320 - -
March 15, 1995 shares
issued to indiv-
iduals for cash at
$1.25 per share
- - 120,000 1,200 - - 148,800 - -
April 25, 1995 shares
issued to a corpor-
ation for cash at
$1.00 per share
- - 125,000 1,250 - - 123,750 - -
May 10, 1995 shares
issued to an indiv-
idual for cash at
$1.00 per share
- - 50,000 500 - - 49,500 - -
June, 1995 shares
issued to indiv-
iduals for cash and
services at $1.25
per share
- - 66,000 660 - - 81,840 - -
June 30, 1995 shares
issued to an indiv-
idual for services at
$1.50 per share
- - 1,400 14 - - 2,086 - -
July 12, 1995 shares
issued to a corpora-
tion for cash at
$2.00 per share
- - 30,000 300 - - 59,700 - -
July 20, 1995 shares
issued to a corp-
oration for cash
at $2.00 per share
- - 14,000 140 - - 20,860 - -
August 15, 1995 shares
issued to an indiv-
idual for cash at
$1.25 per share
- - 40,000 400 - - 49,600 - -
September, 1995 shares
issued to individuals
for cash at $1.25
per share
- - 44,667 446 - - 81,554 - -
October, 1995 shares
issued to indiv-
iduals for cash at
$1.50 - $3.00 per share
- - 19,333 193 - - 43,807 - -
November, 1995 shares
issued to individuals
for cash at $.83 -
$1.50 per share
- - 13,000 130 - - 16,035 - -
December, 1995 shares
issued to indiv-
iduals for cash and
services at $1.25
- $3.00 per share
- - 63,153 632 - - 123,598 - -
Compensation expense
from stock options
issued 1995
- - - - - - 155,000 - -
Net Loss
- - - - - - -(1,309,528) -
Balance at December 31, 1995
- - 8,592,038 85,920 340,000 3,400 3,764,669 (3,333,785) -
January 1996 (pre-
merger) shares
issued to individ-
uals for cash at
$2.50 - 3.00 per
share
- - 3,500 35 - - 7,965 - -
March 1996 (pre-
merger) shares issued
to an individual and
a company for cash
at $2.00 - $3.00 per
share
- - 21,240 212 - - 43,267 - -
April 1996 (pre-
merger) shares issued
to individuals for
cash at $.50 - 2.04
per share
- - 63,000 630 - - 73,370 - -
May 1996 (pre mermer)
shares issued to
individuals for cash
at $3.00 per share
- - 9,000 90 - - 26,910 - -
May 1996 (Pre merger)
shares issued to
individuals for legal
services at $3.00 per
share
- - 1,463 15 - - 4,374 - -
June 1996 (pre merger)
shares issued to a
company in exercise of
an option at $1.00 per
share
- - 100,000 1,000 - - 99,000 - -
June 1996 (pre merger)
shares issued to a
related company for cash at
$1.25 per share
- - 30,000 300 - - 37,200 - -
June 1996 (pre merger)
shares issued to an
individual for cash at
$3.00 per share
- - 5,000 50 - - 14,950 - -
November 15, 1996, shares
issued to individuals
for cash @ $1.29 - 2.59
per share
- - 40,569 406 - - 67,094 - -
November 27, 1996, shares
issued to officer for
cash @ $2.94 per share
- - 2,891 29 - - 8,470 - -
December 13, 1996, shares
issued to individuals
for cash and receivables
@ $1.00 - 3.00 per share
- - 107,624 1,076 - - 187,132 - -
December 13, 1996, shares
issued to a company for
services @ $1.25 per
share
- - 14,282 143 - - 17,710 - -
December 19, 1996, shares
issued to individual to
exercise option @ $1.25
per share
- - 30,000 300 - - 37,200 - -
December 19, 1996, shares
issued to individual for
cash at $1.25 per share
- - 30,000 300 - - 37,200 - -
December 31, 1996, shares
issued to individual
for receivable at
$1.00 - 3.00 per share
- - - - 40,679 407 101,543 - -
December 31, 1996, shares
issued to officer and
employee for patents
- - - - 225,000 2,250 130,500 - -
Net loss
- - - - - - - - (831,814)
Balance at December 31, 1996
- $ - 9,050,607 $90,506 605,679 $6,057 $4,658,554 $(3,333,785) $(831,814)
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
STATEMENT OF CASH FLOWS
Cumulative
For the Year Ended During
December 31, Development
1996 1995 Stage
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $(831,814) $(1,309,528) $(831,814)
Adjustments used to reconcile
net loss to net cash provided
by (used in) operating activities:
Increase (decrease) in
accounts receivable and
prepaid expenses - 12 -
Non cash general and administrative 22,242 20,830 22,242
Compensation Expense from
Stock Options - 155,000 -
Increase (decrease) in accounts
payable 15,894 27,782 15,894
Increase (decrease) in accrued
Liabilities 739 37,916 739
Increase (decrease) in
related party payables - 2,166 -
Deferred income 15,000 214,000 15,000
Depreciation and Amortization 160,619 121,205 160,619
Net Adjustment 214,494 578,911 214,494
Net cash used in operating activities (617,320) (730,617) (617,320)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of equipment (4,800) (19,001) (4,800)
Acquisition of patents (45,490) (29,500) (45,490)
Net cash used by investing activities (50,290) (48,501) (50,290)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds From Capital Stock Issued $ 688,636 $ 823,665 $688,636
Proceeds From Loans 33,500 25,000 33,500
Principle Payments on
Lease Obligations (3,707) (10,816) (3,707)
Cash payments on notes payable (46,041) (59,128) (46,041)
Net Cash Provided by Financing
Activities 672,388 778,721 672,388
Net Increase (Decrease) in Cash
and Cash Equivalents 4,778 (397) 4,778
Cash and Cash Equivalents at
Beginning of the Year 24,674 25,071 24,674
Cash and Cash Equivalents at
End of the Year $ 29,452 $ 24,674 $ 29,452
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION:
Interest $ 8,147 $ 12,591 $ 8,147
Income Taxes $ 100 $ 141 $ 100
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
During 1995 the Company issued 9,553 shares of stock in exchange for legal
services of $20,830.
On May 13, 1996 the Company issued 1,463 shares of stock in exchange for legal
services of $4,398.
On December 13, 1996 the Company issued 14,282 shares of stock in exchange for
consulting services of $17,853.
On December 13, 1996 the company issued 9,416 shares for receivable of
$20,000.
On December 24, 1996 the Company issued 30,000 shares of stock in exchange for
receivable of $37,500.
The accompanying notes are an integral part of these financial statements.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
NOTE 1 - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
This summary of accounting policies for Klever Market, Inc. (Formerly
VideOcart, Inc.) is presented to assist in understanding the Company's
financial statements. The accounting policies conform to generally accepted
accounting principles and have been consistently applied in the preparation of
the financial statements.
Organization and Basis of Presentation
The Company was organized under the laws of the State of Delaware in
December 1989. The Company was in the Development stage from 1989 to 1991.
The Company was an operating company from 1992 to December 8, 1993 when it
filed petitions for relief under Chapter 11 bankruptcy. The Company was
inactive until July 5, 1996 when the Company merged with Klever Kart, Inc. in
a reverse merger and changed its name to Klever Marketing, Inc. (See note 8 -
Merger). The company is in the development stage as of December 31, 1996, and
has not commenced planned principal operations.
Nature of Business
The Company was formed for the purpose of creating a vehicle to obtain
capital, to file and acquire patents, to seek out, investigate, develop,
manufacture and market electronic in-store advertising, directory and coupon
services which have potential for profit. The Company is currently in the
process of the commercialization of the patented process it has acquired.
Cash Equivalents
For the purpose of reporting cash flows, the Company considers all highly
liquid debt instruments purchased with maturity of three months or less to be
cash equivalents to the extent the funds are not being held for investment
purposes.
Earnings per Common Share
Earnings per common share are based upon the weighted average number of
common shares outstanding during each year. Fully diluted earnings per share
are not presented because they are anti-dilutive.
Fixed Assets
Fixed assets are stated at cost. Depreciation and amortization are
computed using the straight-line method over the estimated economic useful
lives of the related assets as follows:
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
(Continued)
NOTE 1 - ORGANIZATION AND SUMMARY OF ACCOUNTING POLICIES
Fixed Assets (Continued)
Computer equipment 3 years
Office furniture and fixtures 5-10 years
Upon sale or other disposition of property and equipment, the cost and
related accumulated depreciation or amortization are removed from the accounts
and any gain or loss is included in the determination of income or loss.
Expenditures for maintenance and repairs are charged to expense as
incurred. Major overhauls and betterments are capitalized and depreciated
over their estimated economic useful lives.
Intangibles
Organization costs and intangibles associated with certain technology
agreements are amortized over 10 years.
NOTE 2 - INCOME TAXES
The Company has accumulated tax losses estimated at $4,000,000 expiring
in years 2005 through 2011. Current tax laws limit the amount of loss
available to be offset against future taxable income when a substantial change
in ownership occurs. The amount of net operating loss carryforward available
to offset future taxable income may be limited if there is a substantial
change in ownership.
NOTE 3 - DEVELOPMENT STAGE COMPANY
The Company has not yet begun principal operations and as is common with
a development stage company, the Company has had recurring losses during its
development stage.
NOTE 4 - LEASE COMMITMENT
On June 1, 1994 the Company entered into a six year commercial lease of
office space with Tree of Stars, Inc./P.D.O. (major shareholders of the
Company). The lease provides for rental payments of $22,428 for two years,
increasing to $25,726 for an additional two years with a provision for the
review of the rental payment requirements every two years thereafter.
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
(Continued)
NOTE 5 - RESEARCH AND DEVELOPMENT
Research and development of the Klever-Kart System began with the sole
purpose of reducing thefts of shopping carts. A voice-activated alarm system
was envisioned. As time and technology progressed, the present embodiment of
the Klever-Kart System evolved into a "product specific" point-of-purchase
advertising system consisting of an easily readable electronic display that
attaches to any shopping cart, a shelf mounted message sending unit that
automatically sends featured products' ad-message to the display and a host
computer using proprietary software.
During the years ended December 31, 1996 and 1995, the Company expended
$280,837 and $772,989 respectively for research and development of the
technology involved with its patents.
On September 26, 1994 the company entered into a technology development
agreement with Electronic Technology Corp. for the further defining of the
requisite componentry and assembly for commercialization of the Company's
Patented Technology. The agreement also provides for Electronic Technology
Corp. to manufacture and assemble up to 250 sets of display units and
accompanying requisite equipment for use in a product movement test which has
been scheduled for mid-1995. The agreement provides for the following payment
schedule:
09/26/94 $ 30,000 Paid September 1994
10/31/94 30,000 Paid October 1994
11/26/94 90,000 Paid November 1994
01/06/95 80,000 Paid February 1995
02/04/95 100,000 Paid March & April 1995
03/04/95 100,000 Paid April & September 1995
04/04/95 100,000 Paid September, October & November 1995
05/04/95 90,000 Paid $60,000 November & December 1995 with
the remaining $30,000 to be paid upon
completion of product movement test.
$620,000
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
(Continued)
NOTE 5 - RESEARCH AND DEVELOPMENT (Continued)
As additional consideration the Company will issue common stock to Electronic
Technology Corp. as follows:
Issued 12/07/94 10,000 shares - upon delivery of written system design
27,500 shares - upon delivery of working prototype
12,500 shares - upon beta test site performance
50,000 shares
NOTE 6 - RELATED PARTY TRANSACTIONS
During 1996, and 1995 various shareholders have loaned the Company
$33,500, and $25,000 respectively. The notes are payable on demand plus
interest at 10% per annum. During 1996 and 1995 principle payments of $46,041
and $59,128 were paid toward these loans. The balance due as of December 31,
1996 is $27,148 plus accrued interest of $1,353.
NOTE 7 - STOCK OPTIONS
During 1992 the Company adopted stock option plans for specified
directors and employees. Compensation expense charged to operations in 1995
is $155,000. The following is a summary of transactions:
Shares Under Option
December 31,
1996 1995
Outstanding, beginning of year 988,500 980,000
Granted during the year 478,500 133,500
Canceled during the year (32,000) -
Exercised during the year (106,500) (125,000)
Outstanding, end of year
(at prices ranging from $.01
to $3.00 per share) 1,328,500 988,500
Eligible, end of year for
exercise currently (at prices
ranging from $.01 to $3.00
per share) 1,328,500 988,500
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
(Continued)
NOTE 8 - MERGER
On July 5, 1996, pursuant to the plan of reorganization, the Company
merged with Klever Kart, Inc. in a reverse merger. The reorganized company is
be obligated to pay up to $150,000 in administrative and priority claims of
the former VideOcart, Inc. The Reorganized Company issued shares of common
stock pursuant to the plan as follows:
* Current shareholders of Klever-Kart received 7,999,866 shares.
* Creditors of the Company (as specified in the second amended plan of
reorganization) will receive 900,000 shares pro rata or $100 if elected by
creditor. As of December 31, 1996 560,000 shares have been issued. The
remaining 340,000 shares has been reserved, and will be issued when the
creditors entitled to them are identified.
* Series B preferred stock holders received 66,000 shares.
* Series D preferred stock holders received 99,994 shares.
* Common stock holders received 99,381 shares.
NOTE 9 - CONTINGENCIES
Mr. Paul G. Begum, President/CEO will be entitled to the use of a leased
vehicle to be paid for by the Company up to $500 monthly lease payments upon
the receipt by the Company of $2,000,000 in financing from investors
introduced to the Company by Mr. Begum.
In consideration of the assignment in September 1993, to the company,
certain technologies and patents relating to the electronic couponing
("Electronic Coupon Patent") by Messrs. Paul G. Begum, President/CEO and Mark
Geiger, V.P. Operations, the Company has agreed to pay stock and/or cash to
Messrs. Begum and Geiger. As of December 31, 1995 the number of shares to be
issued has not been agreed upon by the Board of Directors. As the value of
the Electronic Coupon Patent is unascertainable at December 31, 1995, no
amount of assets or liabilities have been recorded in the financial statements
relating the assignment of the patent.
On May 24, 1996, the Board of Directors agreed to pay Messrs. Begum and
Geiger 200,000 and 25,000 shares, respectively at a price of $.01 per share
for the electronic coupon patent. $132,750 has capitalized in 1996 as
patents. The
KLEVER MARKETING, INC.
(FORMERLY VideOcart, Inc.)
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
(Continued)
NOTE 9 - CONTINGENCIES (Continued)
shares are valued at $.60 per share as this was the value the Company's stock
was selling for when the assignment was made in September 1993. The shares
are to be issued in three annual installments beginning December 1996. In
addition, the Board of Directors has agreed to pay Messrs Begum and Geiger
bonuses of $50,000 and $10,000, respectively upon receipt by the Company of
$2,000,000 in financing from investors introduced to the Company by Mr. Begum.
EXHIBIT 3.01
RESTATED
CERTIFICATE OF INCORPORATION
OF
VIDOECART, INC.
(Changed herin to Klever Marketing, Inc.)
VideOcart, Inc., a corporation formed under the laws of the State of
Delaware on December 8, 1989, does hereby certify as follows:
FIRST: The Name of the corporation is VideOcart, Inc.;
SECOND: In accordance with the provisions of section 245 of the General
Corporation Law of Delaware, the Certificate of Incorporation of VideOcart,
Inc., is hereby amended and restated to read in its entirety as follows:
Article I
The name of the corporation (the "Corporation") shall be:
Klever Marketing, Inc.
Article II
Duration
The Corporation shall continue in existence perpetually unless sooner
dissolved according to law.
Article III
Purposes
To do all and everything necessary, suitable, convenient, or proper for
the accomplishment of any of the purposes of the attainment of any one or more
of the objects herein enumerated or incidental to the powers herein named or
which shall at any time appear conducive or expedient for the protection or
benefit of the Corporation, with all the powers hereafter conferred by the
laws under which this Corporation is organized; and
To engage in any and all other lawful purposes, activities, and pursuits,
whether similar or dissimilar to the foregoing, for which corporations may be
organized under the General Corporation Law of Delaware and to exercise all
powers allowed or permitted thereunder.
Article IV
Capitalization
The Corporation shall have authority to issue an aggregate of 22,000,000
shares, of which 2,000,000 shares shall be preferred stock, $0.01 par value
(hereinafter the "Preferred Stock"), and 20,000,000 shares shall be common
stock, par value $0.01 (hereinafter the "Common Stock"). The powers,
preferences, and rights and the qualification, limitations, or restrictions
thereof, of the shares of stock of each class and series which the Corporation
shall be authorized to issue, is as follows:
(a) Preferred Stock: Shares of Preferred Stock may be issued from
time to time in one or more series as may from time to time be determined by
the board of directors. Each series shall be distinctly designated. All
shares of any one series of the Preferred Stock shall be alike in every
particular, except that there may be different dates from which dividends
thereon, if any, shall be cumulative, if made cumulative. The powers,
preferences, participating, optional, and other rights of each such series and
qualifications, limitations, or restrictions thereof, if any, may differ from
those of any and all other series at any time outstanding. Except as
hereinafter provided, the board of directors of this Corporation is hereby
expressly granted authority to fix by resolution or resolutions adopted prior
to the issuance of any shares of each particular series of Preferred Stock,
the designation powers, preferences and relative participating, optional and
other rights and the qualification, limitations, and restriction thereof, if
any, of such series, including, without limiting the generality of the
foregoing, the following:
(i) The distinctive designation of, and the number of shares of
Preferred Stock which shall constitute each series, which number may be
increased (except as otherwise fixed by the board of directors) or decreased
(but not blow the number of shares thereof outstanding) from time to time by
action of the board of directors;
(ii) The rate and times at which, and the terms and conditions on
which, dividends, if any, on the shares of the series shall be paid; the
extent of preferences or relation, if any, of such dividends to the dividends
payable on any other class or classes of stock of this Corporation or on any
series of Preferred Stock; and whether such dividends shall be cumulative or
noncumulative;
(iii) The right, if any, of the holders of the shares of the same
series to convert the same into, or exchange the same for, any other class or
classes of stock of this Corporation and the terms and conditions of such
conversion or exchange;
(iv) Whether shares of the series shall be subject to redemption and
the redemption price or prices, including, without limitation, a redemption
price or prices payable in share of any other class or classes of stock of the
Corporation, cash, or other property and the time or times at which, and the
terms and conditions on which, shares of the series may be redeemed;
(v) The rights, if any, of the holders of shares of the series on
voluntary or involuntary liquidation, merger, consolidation, distribution, or
sale of assets, dissolution, or winding up of this Corporation;
(vi) The terms of the sinking fund or redemption or purchases
account, if any, to be provided for shares of the series; and
(vii) The voting powers, if any, of the holders of shares of the
series which may, without limiting the generality of the foregoing, include
(A) the right to more or less than one vote per share on any or all matters
voted on by the shareholders, and (B) the right to vote as a series by itself
or together with other series of Preferred Stock or together with all series
of Preferred Stock as a class, on such matters, under such circumstances, and
on such conditions as the board of directors may fix, including, without
limitation, the right, voting as a series by itself or together with other
series of Preferred Stock or together with all series of Preferred Stock as a
class, to elect one or more directors of this Corporation in the event there
shall have been a default in the payment of dividends on any one or more
series of Preferred Stock or under such other circumstances and upon such
conditions as the Board of directors may determine.
(b) Common Stock: The Common stock shall have the following powers,
preferences, rights, qualifications, limitations, and restrictions:
(i) After the requirements with respect to preferential dividends of
Preferred Stock, if any, shall have been met and after this Corporation shall
comply with all the requirements, if any, with respect to the setting aside of
funds as sinking funds or redemption or purchase accounts and subject further
to any other conditions which may be required by the General Corporation Law
of Delaware, then, but not otherwise, the holders of Common Stock shall be
entitled to receive such dividends, if any, as may be declared from time to
time by the board of directors without distinction to series;
(ii) After distribution in full of any preferential amount to be
distributed to the holders of Preferred Stock, if any, in the event of a
voluntary or involuntary liquidation, distributions or sale of assets,
dissolution, or winding up of this Corporation, the holders of the Common
Stock shall be entitled to receive all of the remaining assets of the
Corporation, tangible and intangible, of whatever kind available for
distribution to stockholders, ratably in proportion to the number of shares of
Common Stock held by each without distinction as to series; and
(iii) Except as may otherwise be required by law or this Certificate
of Incorporation, in all matters as to which the vote or consent of
stockholders of the Corporation shall be required or be taken, including, any
vote to amend this Certificate of Incorporation, to increase or decrease the
par value of any stock, effect a stock split or combination of shares, or
alter or change the powers, preferences, or special rights of any class or
series of stock, the holders of the Common Stock shall have one vote per share
of Common Stock on all such matters and shall not have the right to cumulate
their votes for any purpose.
(c) Other Provisions
(i) The board of directors of the Corporation shall have authority to
authorize the issuance, from time to time without any vote or other action by
the stockholders, of any or all shares of the Corporation of any class at any
time authorized, and any securities convertible into or exchangeable for such
shares, in each case to such persons and for such consideration and on such
terms as the Board of directors from time to time in its discretion lawfully
may determine; provided, however, that the consideration for the issuance of
shares of stock of the Corporation having par value shall not be less than
such par value. Shares so issued, for which the full consideration determined
by the board of directors has been paid of the Corporation, shall be fully
paid stock, and the holders of such stock shall not be liable for any further
call or assessment thereon.
(ii) Unless otherwise provided in the resolution of the Bbard of
directors providing for the issue of any series of Preferred Stock, no holder
of shares of any class of the Corporation or of any security of obligation
convertible into, or of any warrant, option, or right to purchase, subscribe
for, or otherwise acquire, shares of any class of the Corporation, whether now
or hereafter authorized, shall, as such holder, have any preemptive right
whatsoever to purchase, subscribe for, or otherwise acquire shares of any
class of the Corporation, whether now or hereafter authorized.
(iii) Anything herein contained to the contrary notwithstanding, any
and all right, title, interest, and claim in and to any dividends declared or
other distributions made by the Corporation, whether in cash, stock, or
otherwise, which are unclaimed by the stockholder entitled thereto for a
period of six years after the close of business on the payment date, shall be
and be deemed to be extinguished and abandoned; and such unclaimed dividends
or other distributions in the possession of the Corporation, its transfer
agents, or other agents or depositories, shall at such time become the
absolute property of the Corporation, free and clear of any and all claims of
any person whatsoever.
Article V
Limitation on Liability
A director of the Corporation shall have no personal liability to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a Director, except (I) for any breach of a director's duty of loyalty
to the Corporation or its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of the
law, (iii) under section 174 of the General Corporation Law of Delaware as it
may from time to time be amended or any successor provision thereto, or (iv)
for any transaction from which a director derived an improper personal
benefit.
Article VI
Business Combinations with Interested Stockholders
The Corporation elects not to be governed by the provisions of section
203 of the General Corporation Law of Delaware regarding business combinations
with interested shareholders.
Article VII
Registered Office and Registered Agent
The name and address of the corporation's registered agent in the State
of Delaware is The Corporation Trust Company, 1209 Orange Street, in the city
of Wilmington, county of New Castle, Delaware. Either the registered office
or the registered agent may be changed in the manner provided by law.
Article VIII
Amendment
The Corporation reserves the right to amend, alter, change, or repeal, all or
any portion of the provisions contained in its Certificate of Incorporation
from time to time in accordance with the law of the State of Delaware, and all
rights conferred on stockholders herein are granted to this reservation.
Article IX
Adoption and Amendment of Bylaws
The bylaws of the Corporation shall be adopted by the board of
directors. The power to alter, amend, or repeal the bylaws or adopt new
bylaws shall be vested in the board of directors, but the stockholders of the
Corporation may also alter, amend, or repeal the bylaws or adopt new bylaws.
The bylaws may contain any provision for the regulation or management of the
affairs of the Corporation not inconsistent with the laws of the State of Delawa
re now or hereafter existing.
Article X
Directors
The governing board of the Corporation shall be known as the board of
directors. The number of directors comprising the board of directors shall be
fixed and may be increased or decreased from time to time in the manner
provided in the bylaws of the Corporation, except that at no time shall there
be less than three nor more than nine directors.
The undersigned, being Paul G. Begum, for the purpose of amending and
restating the Certificate of Incorporation of VideOcart, Inc., makes this
certificate, hereby declaring and certifying that this is his act and deed and
that the facts herein stated are true, and accordingly have hereunto set his
hand this 8th day of August, 1996.
/S/ Paul G. Begum
Paul G. Begum, Duly Authorized Representative
I, Paul g. Begum, hereby certify that I have been duly authorized as a
representative to sign for and on behalf of VideOcart, Inc., by order of the
United States Bankruptcy Court for the Northern District of Illinois, Eastern
Division, in approving the Second Amended and Restated Plan of Reorganization
for VideOcart, Inc., proposed by Klever-Kart, Inc.
/S/ Paul G. Begum
Paul G. Begum
EXHIBIT 3.02
Klever Marketing, Inc.
* * * * * *
BY-LAWS
* * * * * *
Article I
Offices
Section 1. The registered office shall be in the City of Wilmington,
County of New Castle, State of Delaware.
Section 2. The Corporation may also have offices at such other places
both within and without the State of Delaware as the board of directors may
from time to time determine or the business of the Corporation may require.
Article II
Meetings of Stockholders
Section 1. All meetings of the stockholders for the election of
directors shall be held in the City of Salt Lake City, State of Utah, at such
place as may be fixed from time to time by the board of directors, or at such
other place either within or without the State of Delaware as shall be
designated from time to time by the board of directors and stated in the
notice of the meeting. Meetings of stockholders for any other purpose may be
held at such time and place, within or without the State of Delaware, as shall
be stated in the notice of the meeting or in a duly executed waiver of notice
thereof.
Section 2. Annual meetings of stockholders, commencing with the year
1991, shall be held on the third Thursday of October if not a legal holiday,
and if a legal holiday, then on the next secular day following, at 10 A.M., or
at such other date and time as shall be designated from time to time by the
board of directors and stated in the notice of the meeting, at which they
shall elect by a plurality vote board of directors, and transact such other
business as may properly be brought before the meeting.
Section 3. Written notice of the annual meeting stating the place,
date and hour of the meeting shall be given to each stockholder entitled to
vote at such meeting not less than ten nor more than sixty days before the
date of the meeting.
Section 4. The officer who has charge of the stock ledger of the
Corporation shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to examination of any stockholder, for
any purpose germane to the meeting, during ordinary business hours, for a
period of at least ten days prior to the meeting, either at a place within the
city where the meeting is to be held, which place shall be specified in the
notice of the meeting, or, if not so specified, at the place where the meeting
is to be held. The list shall also be produced and kept at the time and place
of the meeting during the whole time thereof, and may be inspected by any
stockholder who is present.
Section 5. Special meetings of the stockholders, for any purpose or
purposes, unless otherwise prescribed by statute or by the certificate of
incorporation, may be called by the president and shall be called by the
president or secretary at the request in writing of a majority of the board of
directors, or at the request in writing of stockholders owning a majority in
amount of the entire capital stock of the Corporation issued and outstanding
and entitled to vote. Such request shall state the purpose or purposes of the
proposed meeting.
Section 6. Written notice of a special meeting stating the place,
date and hour of the meeting and the purpose or purposes for which the meeting
is called, shall be given not less than ten nor more than sixty day before the
date of the meeting, to each stockholder entitled to vote a such meeting.
Section 7. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
Section 8. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholder for the
transaction of business except as otherwise provided by statute or by the
certificate of incorporation. If, however, such quorum shall not be present
or represented at any meeting of the stockholders, the stockholders entitled
to vote thereat, present in person or represented by proxy, shall have power
to adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present or represented.
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. If the adjournment is for more than thirty days, or
if after the adjournment a new record date is fixed for the adjourned meeting,
a notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
Section 9. When a quorum is present at any meeting, the vote of the
holders of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such meeting,
unless the question is one upon which by express provision of the statutes or
of the certificate of incorporation, a different vote is required in which
case such express provision shall govern and control the decision of such
question.
Section 10. Unless otherwise provided in the certificate of
incorporation, each stockholder shall at every meeting of the stockholders be
entitled to one vote in person or by proxy for each share of the capital stock
having voting power held by such stockholder, but no proxy shall be voted on
after three years from its date, unless the proxy provides for a longer
period.
Section 11. Unless otherwise provided in the certificate of
incorporation, any action required to be taken at any annual or special
meeting of stockholders of the Corporation, or any action which may be taken
at any annual or special meeting of such stockholders, may be taken without a
meeting, without prior notice and without a vote, if a consent in writing,
setting forth the action so taken, shall be signed by the holders of
outstanding stock having not less than the minimum number of votes that would
be necessary to authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted. Prompt notice of the taking
of the corporate action without a meeting by less than unanimous written
consent shall be given to those stockholders who have not consented in
writing.
Article III
Directors
Section 1. The number of directors which shall constitute the whole
board shall be not less than three nor more than nine. The first board shall
consist of three directors. Thereafter, within the limits above specified,
the number of directors shall be determined by resolution of the board of
directors or by the stockholders at the annual meeting. The directors shall
be elected at the annual meeting of the stockholders, except as provided in
Section 2 of this Article, and each director elected shall hold office until
his successor is elected and qualified. Directors need not be stockholders.
Section 2. Vacancies and newly created directorships resulting from
any increase in the authorized number of directors may be filled by a majority
of the directors then in office, though less than a quorum, or by a sole
remaining director, and the directors so chosen shall hold office until the
next annual election and until their successors are duly elected and shall
qualify, unless sooner displaced. If there are no directors in office, then
an election of directors may be held in the manner provided by statute. If
at the time of filling any vacancy or any newly created directorship, the
directors then in office shall constitute less than a majority of the whole
board (as constituted immediately prior to any such increase), the Court of
Chancery may, upon application of any stockholder or stockholders holding at
least ten percent of the total number of the shares at the time outstanding
having the right to vote for such directors, summarily order an election to be
held to fill any such vacancies or newly created directorships, or to replace
the directors chosen by the directors then in office.
Section 3. The business of the Corporation shall be managed by or
under the direction of its board of directors which may exercise all such
powers of the Corporation and do all such lawful acts and things as are not by
statute or by the certificate of incorporation or by these by-laws directed or
required to be exercised or done by the stockholders.
Section 4. Meeting of the Board of Directors: The board of
directors of the Corporation may hold meetings, both regular and special,
either within or without the State of Delaware.
Section 5. The first meeting of each newly elected board of directors
shall be held at such time and place as shall be fixed by the vote of the
stockholders at the annual meeting and no notice of such meeting shall be
necessary to the newly elected directors in order legally to constitute the
meeting, provided a quorum shall be present. In the event of the failure of
the stockholders to fix the time or place of such first meeting of the newly
elected board of directors, or in the event such meeting is not held at the
time and place so fixed by the stockholders, the meeting may be held at such
time and place as shall be specified in a notice given as hereinafter provided
for special meetings of the board of director, or as shall be specified in a
written waiver signed by all of the directors.
Section 6. Regular meetings of the board of directors may be held
without notice at such time and at such place as shall from time to time be
determined by the board.
Section 7. Special meetings of the board may be called by the
president on notice to each director, either personally or by mail or by
telegram; special meetings shall be called by the president or secretary in
like manner and on like notice on the written request of two directors unless
the board consists of only one director; in which case special meetings shall
be called by the president or secretary in like manner and on like notice on
the written request of the sole director.
Section 8. At all meetings of the board a majority of the directors
shall constitute a quorum for the transaction of business and the act of a
majority of the directors present at any meeting at which there is a quorum
shall be the act of the board of directors, except as may be otherwise
specifically provided by statute or by the certificate of incorporation. If a
quorum shall not be present at any meeting of the board of directors the
directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be
present.
Section 9. Unless otherwise restricted by the certificate of
incorporation or these by-laws, any action required or permitted to be taken
at any meeting of the board of directors or of any committee thereof may be
taken without a meeting, if all members of the board or committee, as the case
may be, consent thereto in writing, and the writing or writings are filed with
the minutes of proceedings of the board or committee.
Section 10. Unless otherwise restricted by the certificate of
incorporation or these by-laws, members of the board of directors, or any
committee designated by the board of directors, may participate in a meeting
of the board of directors, or any committee, by means conference telephone or
similar communications equipment by means of which all person participating in
the meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.
Section 11. Resignations: Any officer may resign at any time by
delivering a written resignation to the board of directors, the president, or
the secretary. Unless otherwise specified therein, such resignation shall
take effect on delivery.
Section 12. Committees of Directors: The board of directors may, by
resolution passed by a majority of the whole board, designate one or more
committees, each committee to consist of one or more of the directors of the
Corporation . The board may designate one or more directors as alternate
members of any committee, who may replace any absent or disqualified member at
any meeting of the committee.
In the absence or disqualification of a member of a committee, the member
or members thereof present at any meeting and not disqualified from voting,
whether or not he or they constitute a quorum, may unanimously appoint another
member of the board of directors to act at the meeting in the place of any
such absent or disqualified member.
Any such committee, to the extent provided in the resolution of the board
of directors, shall have and may exercise all the powers and authority of the
board of directors in the management of the business and affairs of the
corporation, and may authorize the seal of the Corporation to be affixed to
all papers which may require it; but no such committee shall have the power or
authority in reference to amending the certificate of incorporation, (except
that a committee may, to the extent authorized in the resolution or
resolutions providing for the issuance of shares of stock adopted by the board
of directors as provided in Section 151(a) fix any of the preferences or
rights of such shares relating to dividends, redemption, dissolution, any
distribution of assets of the Corporation or the conversion into, or the
exchange of such shares for, share of any other class or classes or any other
series of the same or any other class or classes of stock of the Corporation)
adopting an agreement of merger or consolidation, recommending to the
stockholders the sale, lease or exchange of all substantially all of the
Corporation's property and assets, recommending to the stockholders a
dissolution of the Corporation or a revocation of a dissolution, or amending
the by-laws of the Corporation; and, unless the resolution or the certificate
of incorporation expressly so provide, no such committee shall have the power
or authority to declare a dividend or to authorize the issuance of stock or to
adopt a certificate of ownership and merger. Such committee or committees
shall have such name or names as may be determined from time to time by
resolution adopted by the board of directors.
Section 13. Each committee shall keep regular minutes of its meetings
and report the same to the board of directors when required.
Section 14. Compensation of Directors: Unless otherwise restricted by
the certificate of incorporation or these by-laws, the board of directors
shall have the authority to fix the compensation of directors. The directors
may be paid their expenses, if any, of attendance at each meeting of the board
of directors and may be paid a fixed sum for attendance at each meeting of the
board of directors or a stated salary as director. No such payment shall
preclude any director from serving the Corporation in any other capacity and
receiving compensation therefor. Members of special or standing committees
may be allowed like compensation for attending committee meetings.
Section 15. Removal of Directors: Unless otherwise restricted by the
certificate of incorporation or by law, any director or the entire board of
directors may be removed, with or without cause, by the holders of a majority
of share entitled to vote at an election of directors.
Article IV
Notices
Section 1. Whenever, under the provisions of the statutes or of the
certificate of incorporation or of these by-laws, notice is required to be
given to any director or stockholder, it shall not be construed to mean
personal notice, but such notice may be given in writing, by mail, addressed
to such director or stockholder, at his address as it appears on the records
of the Corporation, with postage thereon prepaid, and such notice shall be
deemed to be given at the time when the same shall be deposited in the United
State mail. Notice to directors may also be given by telegram.
Section 2. Whenever any notice is required to be given under the
provisions of the statutes or of the certificate of incorporation or of these
by-laws, a waiver thereof in writing, signed by the person or persons entitled
to said notice, whether before or after the time stated therein, shall be
deemed equivalent thereto.
Article V
Officers
Section 1. The officers of the Corporations shall be chosen by the
board of directors and shall be a president, a vice-president, a secretary and
a treasurer. The board of directors may also choose additional
vice-presidents, and one or more assistant secretaries and assistant
treasurers. Any number of the offices may be held by the same person, unless
the certificate of incorporation or these by-laws otherwise provide.
Section 2. The board of directors at its first meeting after each
annual meeting of stockholders shall choose a president, one or more
vice-presidents, a secretary and a treasurer.
Section 3. The board of directors may appoint such other officers and
agents as it shall deem necessary who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the board.
Section 4. The salaries of all officers and agents of the Corporation
shall be fixed by the board of directors.
Section 5. The officers of the Corporation shall hold office until
their successors are chosen and qualify. Any officer elected or appointed by
the board of directors may be removed at any time by the affirmative vote of a
majority of the board of directors. Any vacancy occurring in any office of
the Corporation shall be filled by the board of directors.
The President
Section 6. The president shall be the chief executive officer of the
Corporation, shall preside at all meetings of the stockholders and the board
of directors, shall have general and active management of the business of the
Corporation and shall see that all orders and resolutions of the board of
directors are carried into effect.
Section 7. He shall execute bonds, mortgages and other contracts
requiring a seal, under the seal of the Corporation, except where required or
permitted by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the board of
directors to some other officer or agent of the corporation.
The Vice-Presidents
Section 8. In the absence of the president or in the event of his
inability or refusal to act, the vice-president (or in the event there be more
than one vice-president, the vice-presidents in the order designated by the
directors, or in the absence of any designation, then in the order of their
election) shall perform the duties of the president, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
president. The vice-presidents shall perform such other duties and have such
other powers as the board of directors may from time to time prescribe.
The Secretary & Assistant Secretary
Section 9. The secretary shall attend all meetings of the board of
directors and all meetings of the stockholders and record all the proceedings
of the meetings of the Corporation and of the board of directors in a book to
be kept for that purpose and shall perform like duties for the standing
committees when required. He shall give, or cause to be given, notice of all
meetings of the Stockholders and special meetings of the board of directors,
and shall perform such other duties as may be prescribed by the board of
directors or president, under whose supervision he shall be. He shall have
custody of the corporate seal of the Corporation and he, or an assistant
secretary, shall have authority to affix the same to any instrument requiring
it and when so affixed, it may be attested by his signature or by the
signature of such assistant secretary. The board of directors may give
general authority to any other officer to affix the seal of the Corporation
and to attest the affixing by his signature.
Section 10. The assistant secretary, or if there be more than one,
the assistant secretaries in the order determined by the board of directors
(or if there by no such determination, then in the order of their election)
shall, in the absence of the secretary or in the event of his inability or
refusal to act, perform the duties and exercise the powers of the secretary
and shall perform such duties and have such other powers as the board of
directors may from time to time prescribe.
The Treasurer & Assistant Treasurers
Section 11. The treasurer shall have the custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation and shall deposit all
moneys and other valuable effects in the name and to the credit of the
Corporation in such depositories as may be designated by the board of
directors.
Section 12. He shall disburse the funds of the Corporation as may be
ordered by the board of directors, taking proper vouchers for such
disbursements, and shall render to the president and the board of directors,
at its regular meetings, or when the board of directors so requires, an
account of all his transactions as treasurer and of the financial condition of
the Corporation.
Section 13. If required by the board of directors, he shall give the
Corporation a bond (which shall be renewed every six years) in such sum and
with such surety or sureties as shall be satisfactory to the board of
directors for the faithful performance of the duties of his office and for the
restoration to the Corporation, in case of his death, resignation, retirement
or removal from office, of all books, papers, vouchers, money and other
property of whatever kind in his possession or under his control belonging to
the Corporation.
Section 14. The assistant treasurer, or if there shall be more than
one, the assistant treasurers in the order determined by the board of
directors (or if there be no such determination, then in the order of their
election) shall, in the absence of the treasurer or in the event of his
inability or refusal to act, perform the duties and exercise the powers of the
treasurer and shall perform such other duties and have such h other powers as
the board of directors may from time to time prescribe.
Article VI
Certificates for Shares
Section 1. The shares of the Corporation shall be represented by a
certificate or shall be uncertificated. Certificates shall be signed by, or
in the name of the Corporation by, the chairman or vice-chairman of the board
of directors, or the president or a vice-president and the treasurer or an
assistant treasurer, or the secretary or an assistant secretary of the
Corporation or by a certified designated stock transfer agent authorized by
the President and or CEO.
Within a reasonable time after the issuance or transfer of uncertificated
stock, the Corporation shall send to the registered owner thereof a written
notice containing the information required to be set forth or stated on
certificates pursuant to Sections 151, 156, 202(a) or 218(a) or a statement
that the Corporation will furnish without charge to each stockholder who so
requests that powers, designations, preferences and relative participating,
optional or other special rights of each class of stock or series thereof and
the qualifications, limitations or restrictions of such preferences and/or
rights.
Section 2. Any of or all the signatures on a certificate may be
facsimile. In case any officer, transfer agent or registrar who has signed or
whose facsimile signature has been placed upon a certificate shall have ceased
to be such officer, transfer agent or registrar before such certificated is
issued, it may be issued by the Corporation with the same effect as if he were
such officer, transfer agent or registrar at the date of issue.
Section 3. Lost Certificates: The board of directors may direct a new
certificate or certificates or uncertificated shares to be issued in place of
any certificate or certificates theretofore issued by the Corporation alleged
to have been lost, stolen or destroyed, upon the making of an affidavit of
that fact by the person claiming the certificate stock to be lost, stolen or
destroyed. When authorizing such issue of a new certificate or certificates
or uncertificated shares, the board of directors may, in its discretion and as
a condition precedent to the issuance thereof, require the owner of such lost,
stolen or destroyed certificate or certificates, or his legal representative,
to advertise same in such manner as it shall require and/or to give the
Corporation a bond in such sum as it may direct as indemnity against any claim
that may be made against the Corporation with respect to the certificate alleged
to have been lost, stolen or destroyed.
Section 4. Transfer of Stock: Upon surrender to the Corporation or the
transfer agent of the Corporation of a certificate for shares duly endorsed or
accompanied by proper evidence of succession, assignation or authority to
transfer, it shall be the duty of the corporation to issue a new certificate
to the person entitled thereto, cancel the old certificate and record the
transaction upon its books. Upon receipt of proper transfer instructions
from the registered owner of uncertificated shares such uncertificated share
shall be canceled and issuance of a new equivalent uncertificated shares or
certificated shares shall be made to the person entitled thereto and the
transaction shall be recorded upon the books of the Corporation.
Section 5. Fixing Record Date: In order that the Corporation ma
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock
or for the purpose of any other lawful action, the board of directors may fix,
in advance, a record date, which shall not be more than sixty nor less than
ten days before the date of such meeting, nor more than sixty days prior to
any other action. A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall apply to any
adjournment of the meeting: provided however, that the board of directors may
fix a new record date for the adjourned meeting.
Section 6. Registered Stockholders: The Corporation shall be entitled
to recognize the exclusive right of a person registered on its books as the
owner of shares to receive dividends, and to vote as such owner, and to hold
liable for calls and assessments a person registered on its books as the owner
of shares, and shall not be bound to recognize an equitable or other claim to
or interest in such share or shares on the part of any other person, whether
or not it shall have express or other notice thereof, except as otherwise
provided by the laws of Delaware.
Article VII
General Provisions
Section 1. Dividends: Dividends upon the capital stock of the
Corporation, subject to the provisions of the certificate of incorporation, if
any, may de declared by the board of directors at any regular or special
meeting, pursuant to law. Dividends may be paid in cash, in property, or in
shares of the capital stock, subject to the provisions of the certificate of
incorporation.
Section 2. Before payment of any dividend, there may be set aside
out of any funds of the Corporation available for dividends such sum or sums
as the directors from time to time, in their absolute discretion, think proper
as a reserve or reserves to meet contingencies, or for equalizing dividends,
or for repairing or maintaining any property of the Corporation, or for such
other purpose as the directors shall think conducive to the interest of the
Corporation, and the directors may modify or abolish any such reserve in the
manner in which it was created.
Section 3. Annual Statement: The board of directors shall present at
each annual meeting, and at any special meeting of the stockholders when
called for by vote of the stockholders, a full and clear statement of
business and condition of the Corporation.
Section 4. Checks: All checks or demands for money and notes of the
Corporation shall be signed by such officer or officers or such other person
or persons as the board of directors may from time to time designate.
Section 5. Fiscal Year: The fiscal year of the Corporation shall be
fixed by resolution of the board of directors.
Section 6. Seal: The corporate seal shall have inscribed thereon the
name of the Corporation, the year of its organization and the words "Corporate
Seal, Delaware". The seal may be used by causing it or a facsimile thereof to
be impress or affixed or reproduced or otherwise.
Section 7. Indemnification: The Corporation shall indemnify its
officers, directors, employees and agents to the extent permitted by the
General Corporation Law of Delaware.
Article VIII
Amendments
Section 1. These by-laws may be altered, amended or repealed or new
by-laws may be adopted by the Stockholders or by the board of directors, when
such power is conferred upon the board of directors by the certificate of
incorporation at any regular meeting of the stockholders or of the board of
directors or at any special meeting of the stockholders or of the board of
directors if notice of such alteration, amendment, repeal or adoption of new
by-laws be contained in the notice of such special meeting. If the power to
adopt, amend or repeal by-laws is conferred upon the board of directors by the
certificate of incorporation it shall not divest or limit the power of the
stockholders to adopt, amend or repeal by-laws.
Exhibit 23.01
We hereby consent to the inclusion in this Form 10KSB of our
report dated March 3, 1997 on our audit of the financial statements
of Klever Marketing, Inc.
/S/ Robison, Hill & Co.
Certified Public Accountants
Salt Lake City, Utah
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IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
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