As filed with the Securities and Exchange Commission on _____________
Registration No. 333-_________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
TNT Designs, Inc.
(Exact name of registrant as specified in charter)
Delaware 5632 20-0937461
(State or other jurisdiction of Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
|
Anju Tandon
President and Chief Executive Officer
TNT Designs, Inc.
305 Madison Avenue, Suite 449
New York, NY 10165
917-215-1222
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
Joseph A. Baratta, Esq.
Baratta & Goldstein
597 Fifth Avenue
New York, New York 10017
(212) 750-9700 (Phone)
(212) 750-8297 (Fax)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this
Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended, check the following box. |X|.
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, as amended, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_|
If delivery of this Prospectus is expected to be made pursuant to Rule 434, please check the following box. |_|
(1) Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(a) under the Securities Act of 1933, as amended based upon the price the issuer received for the sale of common stock to the public pursuant to transactions exempt under Regulation D of the Securities Act. There is no established public market for the common equity being registered nor does the Registrant make any representations t 0 6 that the common stock will ever trade or be listed on an exchange or quotation system. As of September 30, 2004 the Company's assets exceeded its liabilities by $7,793, and the Company had 2,100,000 shares issued and outstanding. The offering price has been determined by the sales price of the Company's common stock under its recent Private Placement under Regulation D of the Securities Act, as amended whereby the Company sold 100,000 shares of common stock for $0.10 a share.
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
Information contained herein is subject to completion or amendment. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This prospectus shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.
SUBJECT TO COMPLETION, DATED December __, 2004
PRELIMINARY PROSPECTUS
TNT DESIGNS, INC.
700,000 shares of common stock, $0.0001 par value
o As of December 22, 2004 we had 2,200,000 shares of our common stock issued and outstanding.
o We will not receive any proceeds from the sale of these shares as the shares are offered by the selling security holders listed herein.
o Our common stock is not traded on any market and although we intend to initiate steps to include our common stock for listing on the the Over-the-Counter Bulletin Board ("OTCBB"), we may not be successful in such efforts and our stock may never trade in any market. See "Risk Factors".
o The selling security holders (as detailed below) will sell at a fixed price of $0.10 per share until our common shares are quoted on the OTCBB and thereafter at prevailing market prices, or privately negotiated prices. See "Plan of Distribution".
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" BEGINNING ON PAGE 3.
We may amend or supplement this Prospectus from time to time by filing amendments or supplements as required. You should read the entire Prospectus and any amendments or supplements carefully before you make your investment decision.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this Prospectus is December __, 2004.
TABLE OF CONTENTS
Page
Part I. Information Required in Prospectus
The Company - Prospectus Summary 1
The Offering, including Use of Proceeds and Determination of Offering Price 2
Risk Factors 3
Dilution 8
Selling Security Holders 8
Plan of Distribution 9
Legal Proceedings 10
Directors, Executive Officers, Promoters and Control Persons 10
Security Ownership of Certain Beneficial Owners and Management 11
Description of the Securities 11
Disclosure of Commission Position on Indemnification for Securities Act Liabilities 11
Description of Business 12
Plan of Operation 14
Description of Property 15
Certain Relationships and Related Transactions 15
Market for Common Stock and Related Stockholder Matters 15
Executive Compensation 15
Financial Statements 15
Interest of Named Experts and Counsel 15
Part II. Information Not Required in Prospectus
Item 24. Indemnification of Directors and Officers II-1
Item 25. Other Expenses of Issuance and Distribution II-1
Item 26. Recent Sales of Unregistered Securities II-1
Item 27. Exhibits II-2
Item 28. Undertakings II-2
Signatures II-3
|
THE COMPANY - PROSPECTUS SUMMARY
The following is a summary of material information which is supported in its entirety by detailed information, including financial information and notes thereto, contained in this prospectus. The highlighted summary is intended for reference only. Before making any investment, you should carefully consider the information under the heading "Risk Factors". Please note that throughout this prospectus the words "Company", "we", "our" or "us", refer to TNT Designs, Inc.
About Us
We were incorporated in Delaware on February 17, 2004 and have 30,000,000 shares of common stock $0.0001 par value authorized. At the time of our formation, we issued 2,000,000 shares of our common stock to our sole director and executive officer Anju Tandon who is also included in this prospectus as a selling security holder.
We have a very limited operating history, and are characterized as a "development stage company". Our current business is focused on the marketing and distribution of women's beauty products and fashion accessories. We intend to grow our business through traditional sales and marketing as well as through the hosting of fashion shows which enable us to sell our products to retail customers.
In May of 2004 we completed a private placement under Regulation D of the Securities Act of 1933, as amended, whereby we issued 100,000 shares of our common stock to eleven accredited investors and received $10,000 in gross proceeds which we have been using for general working capital purposes.
In September 2004, we entered into an exclusive alliance and distribution agreement with Radico Export Import Ltd., an Indian corporation, for the distribution of women's beauty products and fashion accessories produced by Radico. The agreement provides us with exclusive distribution rights in New York State, and we have not derived any revenues to date under the agreement.
Securities Offered
This prospectus covers the resale by the selling security holders named in this prospectus of up to 700,000 shares of our common stock. The offered shares include shares issued to our sole director and executive officer at the time of our formation, shares issued to legal counsel in consideration for services performed on behalf of the Company and, shares aquired in private placement transactions which were exempt from the registration requirements of the Securities Act of 1933. The selling security holders will sell their shares of our common stock at $0.10 per share until our common stock is quoted on the OTC Bulletin Board, or listed for trading or quotation on any other public market, and therafter at prevailing market prices or privately negotiated prices. Our common stock is presently not traded on any market or securities exchange, and we have not applied for listing or quotation on any public market. Please see "Plan of Distribution" at page 9 of this prospectus for a detailed explanation of how the common shares may be sold. We are not offering any shares through this prospectus.
Number of Our Shares Outstanding
We are currently authorized to issue up to 30,000,000 shares of our common stock $0.0001 par value and have issued a total of 2,200,000 shares as of December 22, 2004.
Use of Proceeds
We will not receive any of the proceeds from the sale of shares of our common stock being offered for sale by the selling security holders. We will incur all costs associated with this registration statement and prospectus.
Summary of Our Financial Data
The summarized financial data presented below is derived from and should be read in conjunction with our audited financial statements from February 17, 2004 (our date of inception) to September 30, 2004 along with the notes to those financial statements which are included elsewhere in this prospectus along with the section entitled "Plan of Operation".
For the period February 17, 2004 (Inception) to
September 30, 2004
------------------------------------------------------
General and Administrative Expenses $2,407
Net Loss $2,407
As of September 30, 2004
------------------------------------------------------
Cash $15,907
Total Assets $16,903
Total Stockholders Equity $7,793
Total Liability and Stockholders Equity $16,903
|
THE OFFERING
Common stock, $0.0001 par value per share ("Common
Stock"), outstanding as of December 22, 2004: 2,200,000 shares.
Shares offered by selling security holders 700,000 shares which have been issued to selling security holders
and are included in our outstanding shares.
Risk Factors The shares involve a high degree of risk. Investors should carefully
consider the information set forth under "RISK FACTORS" beginning on
page 3.
Use of Proceeds We will not receive any proceeds from the sale of common stock offered
through this prospectus by the selling shareholders. The registration
of these shares does not necessarily mean that any of these shares
will be offered or sold by the selling shareholders. All proceeds from
the sale of shares sold under this prospectus will go to the selling
shareholders.
Determination of Offering Price This prospectus may be used from time to time by the selling
shareholders who offer the common stock in privately negotiated
transactions or at a fixed price of $0.10 until our common shares are
quoted on the Over-the-Counter Bulletin Board ("OTCBB") and thereafter
at prevailing market prices at the time of sale, at prices related to
the prevailing market prices, or at other negotiated prices. The
selling shareholders will act independently in determining the
offering price of each sale. There are no assurances that our common
stock will ever be listed on the OTCBB or an exchange.
Trading Market None.
|
FORWARD-LOOKING INFORMATION
When used in this prospectus, the words "believes", "plans", "anticipates", "will likely result", "will continue", "projects", "expects", and similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including those risks defined above, which could cause actual results to differ materially from those projected.
We caution readers not to place undue reliance on any forward-looking statements, which are based on certain assumptions and expectations which may or may not be valid or actually occur, and which involve certain risks, including the risks defined below. Sales and other revenues may not commence and/or continue as anticipated due to delays or otherwise. As a result, our actual results for future periods could differ materially from those anticipated or projected.
RISK FACTORS
In addition to the other information in this prospectus, TNT Designs, Inc. has identified a number of risk factors that the Company faces. These factors, among others, may cause actual results, events or performance to differ materially from those expressed in any forward-looking statements made in this prospectus or in other filings with the Securities and Exchange Commission or in press releases or other public disclosures. Investors should be aware of the existence of these factors and should consider them carefully in evaluating our business before purchasing the shares offered in this prospectus.
Risks Related to Our Financial Condition
Our Short Operating History Makes our Business Difficult To Evaluate
We are a development stage company, with no significant history of operations. We were incorporated on February 17, 2004, and are a start up company with very little operating history or revenues. Our business is in the early stage of development and we have not generated any profit to date. Significant additional development and marketing of our business is necessary prior to our achieving significant revenues or profitability.
Accordingly, we have a limited operating history upon which to base an evaluation of our business and prospects. Our business and prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly companies in rapidly evolving markets such as ours. To address these risks, we must successfully implement our business plan and marketing strategies (See "Plan of Operation" herein). We may not successfully implement all or any of our business strategies or successfully address the risks and uncertainties that we encounter.
As We Are a Development Stage Company, Our Failure to Secure Additional Financing May Affect our Ability to Survive.
We will require additional financing in order to establish profitable operations. Such financing may not be forthcoming. Even if additional financing is available, it may not be available on terms we find favorable. Failure to secure needed additional financing will have a very serious affect on our ability to develop operations or maintain our business.
We Have Yet to Attain Profitable Operations and Because We Will Need Additional Financing to Fund the Development of Our Business, We May Experience Difficulty In Our Efforts To Continue as a Going Concern.
We have incurred a net loss of $2,407 for the period from February 17, 2004 (inception) to September 30, 2004, and have no revenues to date. The successful implementation of our business plan is dependent upon our ability to obtain financing and upon our future profitable operations from the development of our business.
Our financial statements included with this prospectus have been prepared assuming that we will continue as a going concern. A going concern paragraph has not been issued in that we currently have adequate cash on hand for our current monthly operating expenses which are nominal. However we may fail to remain a going concern should we seek to expand our business operations and effectuate our business plan as anticipated (See "Plan of Operation" herein) without additional financing. If we are not able to achieve revenues or obtain financing, then we may not be able to continue as a going concern and our financial condition and business prospects will be adversely affected.
We Have No Revenues.
We have no history of profits and no assurances of profits ever developing. We have been dependent upon funds received from a private placement of shares of our common stock as well as a loan from our President to sustain our development activities to date. Our business and marketing strategy contemplates that we will earn a substantial portion of our revenues from sales commissions (See "Plan of Operation" herein). There is no assurance that we will be able to generate revenues from sales commissions or that the revenues generated will exceed the operating costs of our business. Customers may not accept our products due to fashion trends and other subjective factors beyond our control.
Our Future Operating Results Will Be Difficult To Predict.
Our future financial results are uncertain due to a number of factors, many of which are outside our control. These factors include:
o Our ability to successfully market our products;
o Our ability to import \products from India, the main source of our
products;
o Our ability to perform under our distribution and alliance
agreement;
o The amount and timing of costs relating to expansion of the our
operations;
o Our ability to identify and enter into successful strategic
ventures; and
o General economic conditions and economic conditions specific to our
industry.
These factors could negatively impact our financial results, with the result that we may not achieve profitability and our business may fail.
Risks Related to the Market for Our Common Stock
There is No Active Trading Market For Our Common Stock and If a Market For Our Common Stock Does Not Develop, Our Investors Will Be Unable To Sell Their Shares.
There is currently no active trading market for our common stock and such a market may not develop or be sustained. We currently plan to have our common stock quoted on the National Association of Securities Dealers Inc.'s OTC Bulletin Board upon the effectiveness of this registration statement of which this prospectus forms a part. In order to do this, a market maker must file a Form 15c-211 to allow the market maker to make a market in our shares of common stock. At the date hereof, we are not aware that any market maker has any such intention. We cannot provide our investors with any assurance that our common stock will be traded on the OTC Bulletin Board or, if traded, that a public market will materialize. Further, the OTC Bulletin Board is not a listing service or exchange, but is instead a dealer quotation service for subscribing members. If our common stock is not quoted on the OTC Bulletin Board or if a public market for our common stock does not develop, then investors may not be able to resell the shares of our common stock that they have purchased and may lose all of their investment. If we establish a trading market for our common stock, the market price of our common stock may be significantly affected by factors such as actual or anticipated fluctuations in our operation results, general market conditions and other factors. In addition, the stock market has from time to time experienced significant price and volume fluctuations that have particularly affected the market prices for the shares of developmental stage companies, which may materially adversely affect the market price of our common stock.
Because We Do Not Intend to Pay any Dividends On Our Common Shares, Investors Seeking Dividend Income or Liquidity Should Not Purchase Our Shares.
We do not currently anticipate declaring and paying dividends to our shareholders in the near future. It is our current intention to apply net earnings, if any, in the foreseeable future to increasing our working capital. Prospective investors seeking or needing dividend income or liquidity should, therefore, not purchase our common stock. We currently have no revenues and a history of losses, so there can be no assurance that we will ever have sufficient earnings to declare and pay dividends to the holders of our shares, and in any event, a decision to declare and pay dividends is at the sole discretion of our board of directors, who currently do not intend to pay any dividends on our common shares for the foreseeable future.
Sales Of a Substantial Number of Shares of Our Common Stock Into The Public Market By Selling Stockholders May Result In Significant Downward Pressure On The Price of Our Common Sstock and Could Affect the Ability of Our Stockholders to Realize Any Current Trading Price of Our Common Stock.
Sales of a substantial number of shares of our common stock in the public market could cause a reduction in the market price of our common stock, when and if such market develops. When this registration statement is declared effective, the selling stockholders may be reselling up to 31.8% of the issued and outstanding shares of our common stock. As a result of such registration statement, a substantial number of our shares of common stock which have been issued may be available for immediate resale when and if a market develops for our common stock, which could have an adverse effect on the price of our common stock. As a result of any such decreases in price of our common stock, purchasers who acquire shares from the selling stockholders may lose some or all of their investment.
Any significant downward pressure on the price of our common stock as the selling stockholders sell the shares of our common stock could encourage short sales by the selling stockholders or others. Any such short sales could place further downward pressure on the price of our common stock.
Our Stock Is a Penny Stock. Trading of Our Stock May Be Restricted by the SEC's Penny Stock Regulations Which May Limit a Stockholder's Ability To Buy and Sell Our Stock.
Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in and limit the marketability of our common stock.
NASD Sales Practice Requirements May Also Limit a Stockholder's Ability to Buy and Sell Our Stock.
In addition to the "penny stock" rules promulgated by the Securities and Exchange Commission (see above and the "Market for Common Equity and Related Stockholder Matters" section at page 15 for discussions of penny stock rules), the NASD has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and other information. Under interpretations of these rules, the NASD believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. The NASD requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the market for our shares.
Risks Related to Our Business
We Have Only Commenced Our Business Operations in February 2004 and We Have a Limited Operating History and May Not be Able to Successfully Manage the Risks Normally Faced by Start-up Companies and Our Business May Fail.
We have a limited operating history. Our operating activities since our incorporation on February 17, 2004 consisted primarily of completing a private placement of our common stock whereby we issued 100,000 shares to eleven accredited investors and raised $10,000 for general operating purposes and our execution of an alliance agreement for the importation and sale of women's beauty products and fashion accessories with our business partner Radico Export Import Ltd., an Indian entity. Although our alliance agreement with Radico is exclusive, the exclusivity of the agreement is limited to New York State which may also limit our ability to enter into distribution agreements with national chains.
If We Cannot Locate Qualified Personnel, We May Have To Suspend Or Cease Operations Which May Result In The Loss Of Your Investment.
While our sole officer and director has experience in financial services as well as apparel and the home furnishings industry, as the sole officer, her decisions and choices may not take into account standard practices companies commonly use within our industry. Consequently our operations, earnings and ultimate financial success could suffer irreparable harm. As a result, we may have to suspend or cease operations which will result in the loss of your investment.
Inability of Officers and Directors to Devote Sufficient Time to the Operation of the Business May Limit Our Success.
Presently our sole officer and director allocates only a portion of her time to the operation of our business. Should our business develop faster than anticipated, she may not be able to devote sufficient time to the operation of the business to ensure that we continue in business. Even if this lack of sufficient time of our management is not fatal to our existence it may result in limited growth and success of the business.
We Lack an Operating History and Have Losses Which We Expect To Continue Into The Future Which May Require Us To Suspend Or Cease Operations.
We were incorporated in February 2004 and we have not started substantial business operations nor realized any revenues. We have no operating history upon which an evaluation of our future success or failure can be made. Our net loss since inception was $2,407. Our ability to achieve and maintain profitability and positive cash flow is dependet in part upon:
o Our ability to enter into additional successful strategic alliances;
o Our ability to generate revenues;
o Our ability to gain market acceptance of our products;
o Development of and execution of our business plan (see "Plan of Operation");
o Development of a strong customer base;
o Acceptance of our products; and
o Maintaining and attracting talented and experienced personnel both in management as well as sales in the women's beauty product and fashion accessories market.
Based upon current plans, we expect to incur operating losses in future periods. This will happen because there are expenses associated with the establishment of a clientele base as well as market acceptance. As a result, we may not generate revenues in the future. Failure to generate revenues will cause us to suspend or cease operations.
Because Our Sole Officer And Director Currently Owns Approximately 91% of Our Outstanding Shares She Will Unilaterally Be Able to Decide Certain Corporate Action Including Deciding Who Will Be Directors.
Anju Tandon our sole officer and director currently owns 2,000,000 of the 2,200,000 shares of common stock that are currently outstanding, or approximately 91%. As such, Ms. Tandon will be able to control all aspects of our business from day to day operations including the election of board members the acquisition or disposition of our assets and the future issuance of our shares. Because our sole officer and director is our principal shareholder, investors will not be able to replace our management if they disagree with the way our business is being run. Control by an insider could result in management making decisions that are not in the best interest of investors which may result in your losing all of the value of your investment in our common stock.
We Cannot Guarantee We Will Ever Develop a Customer Base.
We have no customers and a limited number of suppliers. We have entered into an alliance agreement for distribution of women's beauty products and fashion accessories, and we have identified a limited number of clients, customers or suppliers. Even if we obtain clients, customers and suppliers for our services, there is no guarantee that our suppliers will supply us, or that our customers will use the products we offer. If we are unable to attract enough suppliers to offer products for sale or enough customers to buy our products we will have to suspend or cease operations.
Because We Are Small and Do Not Have Substantial Capital, We Must Limit Marketing Our Products to Potential Customers and Suppliers. As a Result, We May Not Be Able to Attract Enough Customers to Operate Profitably. If We Do Not Make A Profit, We May Have to Suspend or Cease Operations.
Because we are a small development stage company and presently have extremely limited capital, we must limit marketing to potential customers and suppliers. We intend to generate revenues through the sale of women's beuaty products and fashion accessories. Because we will be limiting our marketing activities, we may not be able to attract enough customers to buy or suppliers to sell to operate profitably. If we cannot operate profitably, we may have to suspend or cease operations.
We Depend On Our Key Employee.
Although we presently have one employee, competition for qualified personnel in our industry is intense. We believe that our future success will depend in part on our ability to attract, hire and retain qualified personnel.
We Are Currently Dependent For All Products We Intend to Sell and Distribute Through Our Only Alliance Agreement.
Our sole alliance agreement for the importation and sale of our products is with Radico Export Import Ltd., an Indian corporation. Should we have difficulty obtaining apparel products from Radico or should we have difficulty importing these products from other sources, our business operations may be adversely affected and we may be required to cease operations.
We Face Intense Competition From More Established Companies with Products That Have or May Gain Market Acceptance Prior to Our Products.
As we are a start-up company, we have limited resources and abilities to compete with larger and more established companies. Competition in the specialty retail industry is intense and we may not have the required resources to compete against a more established company under any circumstance.
To Continue Operating We Will Eventually Need to Earn a Profit or Obtain Additional Financing to Enable Us To Continue In Business Until We Are Able to Earn a Profit.
Potential investors should be aware of the risks, uncertainties, difficulties and expenses we face as a newly formed company seeking to sell and distribute women's beauty products and fashion accessories in a limited geographic area. If we cannot earn a profit, we may eventually be forced to discontinue our business. We will need additional capital to fund our operating losses and to expand our business. Additional capital may not be available to us on favorable terms when required, or at all. If additional financing is not available when needed, we may need to dramatically change our business plan, sell or merge our business or cease operations. In addition, our issuance of equity or equity-related securities to raise additional capital will dilute the ownership interest of existing shareholders.
DILUTION
The common stock to be sold by the selling security holders is 700,000 shares of common stock that is currently issued and outstanding. Accordingly, there will be no dilution to our existing stockholders.
SELLING SECURITY HOLDERS
The common stock under this registraton statement is being offerd by the selling security holders named below. Pursuant to this registration statement, once declared effective by the Securities and Exchange Commission, these shares can be sold in any and all states that recognize an effective registration statement. The table indicates the number of shares owned by the selling secutiry holder prior to the offering and the number of shares being offered by the selling security holder and assumes that all shares included in this offering will be sold by the selling security holder, however there can be no assurances that any of the shares offered hereby are sold. The actual number of shares of common stock offered in this prospectus, and included in the registration statement of which this prospectus is a part, includes such additional number of shares of common stock as may be issued or issuable upon a stock split, stock dividend or similar transaction involving the common stock, in accordance with Rule 416 under the Securities Act of 1933, as amended.
Except with respect to Anju Tandon, our sole officer and director and Joseph Baratta who has provided legal services to us, who are both listed as a selling security holders, none of the other selling security holders so listed below are deemed affiliates of the Company. Additionally, no derivative securities are currently outstanding and ownership interest of a selling security holder is not aggregated to that of another selling security holder to the best of the Company's knowledge. Accordingly the beneficial ownership of the common stock by the selling security holder set forth in the table is determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended.
The applicable percentage of ownership listed below is based on 2,200,000 shares of common stock outstanding as of December 22, 2004.
Common stock
Beneficially Common stock
Owned Prior to Common stock Beneficially Owned
Offering to be Sold (a) After Offering
---------------------------------------------------------------------
Holder Number Number Number Percent
Anju Tandon (1) 2,000,000 500,000 1,500,000 100%
Michael Balducci (2) 5,000 5,000 -0- -0-
Frank Cardamone (2) 5,000 5,000 -0- -0-
Indra Dattagupta (2) 10,000 10,000 -0- -0-
Sangeeta Rai* (2) 5,000 5,000 -0- -0-
Amit Sanghrajka (2) 5,000 5,000 -0- -0-
Vanita Savani* (2) 5,000 5,000 -0- -0-
Sripal Shah (2) 5,000 5,000 -0- -0-
Satya P. Tandon(4) (2) 5,000 5,000 -0- -0-
Renu B. Tandon(4) (2) 5,000 5,000 -0- -0-
Rashmi Thakar* (2) 45,000 45,000 -0- -0-
John Weiss (2) 5,000 5,000 -0- -0-
Joseph Baratta (3) 100,000 100,000 -0- -0-
--------- ------- ---------
Totals 2,200,000 700,000 1,500,000
========= ======= =========
|
* Sister of Anju Tandon
(a) Assumes all shares included in this offering are sold by the selling security holder.
(1) Anju Tandon is the Company's sole officer, director and employee, in consideration of a subscription of $200 upon formation of the Company on February 17, 2004, she was issued 2,000,000 founder shares.
(2) Selling Security Holders were subscribers under the Company's Private Placement Memorandum dated February 24, 2004 pursuant to Regulation D of the Securities Act of 1933, as amended. Security holders subscribed to shares of common stock at a per share price of $0.10 per share for an aggregate of $10,000 in subscriptions.
(3) Received as consideration for legal services performed on behalf of the Company
(4) Father and Mother-In Law of Anju Tandon
PLAN OF DISTRIBUTION
The selling security holders and any of their pledgees, donees, transferees, assignees and successors-in-interest may, from time to time, sell any or all of their shares of Common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. Our common stock is not currently listed on any national exchange or electronic quotation system. To date, no actions have been taken to list our shares on any national exchange or electronic quotation system. Because there is currently no public market for our common stock, the selling security holders will sell their shares of our common stock at a price of $0.10 per share until shares of our common stock are quoted on the OTC Bulletin Board, or listed for trading or quoted on any other public market, and thereafter at prevailing market prices or privately negotiated prices. If a public trading market develops, the selling security holders may use any one or more of the following methods when selling shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits Investors;
o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o to cover short sales made after the date that this Registration
Statement is declared effective by the Commission;
o broker-dealers may agree with the selling security holders to sell a
specified number of such shares at a stipulated price per share;
o a combination of any such methods of sale; and
o any other method permitted pursuant to applicable law.
The selling security holders may also sell shares under Rule 144 under the Securities Act, if available, rather than under this prospectus.
Broker-dealers engaged by the selling security holders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts from the selling security holders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be negotiated. The selling security holders do not expect these commissions and discounts to exceed what is customary in the types of transactions involved.
The selling security holders may from time to time pledge or grant a security interest in some or all of the Shares owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell shares of Common stock from time to time under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act of 1933 amending the list of selling security holders to include the pledgee, transferee or other successors in interest as selling security holders under this prospectus.
Upon the Company being notified in writing by a selling security holder that any material arrangement has been entered into with a broker-dealer for the sale of Common stock through a block trade, special offering, exchange distribution or secondary distribution or a purchase by a broker or dealer, a supplement to this prospectus will be filed, if required, pursuant to Rule 424(b) under the Securities Act, disclosing (i) the name of each such selling security holder and of the participating broker-dealer(s), (ii) the number of shares involved, (iii) the price at which such the shares of Common stock were sold, (iv)the commissions paid or discounts or concessions allowed to such broker-dealer(s), where applicable, (v) that such broker-dealer(s) did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus, and (vi) other facts material to the transaction. In addition, upon the Company being notified in writing by a selling security holder that a donee or pledge intends to sell more than 500 shares of Common stock, a supplement to this prospectus will be filed if then required in accordance with applicable securities law.
The selling security holders also may transfer the shares of Common stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.
The selling security holders and any broker-dealers or agents that are involved in selling the shares may be deemed to be "underwriters" within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act. Discounts, concessions, commissions and similar selling expenses, if any, that can be attributed to the sale of Securities will be paid by the selling security holder and/or the purchasers. Each selling security holder has represented and warranted to the Company that it acquired the securities subject to this registration statement in the ordinary course of such selling security holder's business and, at the time of its purchase of such securities such selling security holder had no agreements or understandings, directly or indirectly, with any person to distribute any such securities.
The Company has advised each selling security holder that it may not use shares registered on this Registration Statement to cover short sales of Common stock made prior to the date on which this Registration Statement shall have been declared effective by the Commission. If a selling security holder uses this prospectus for any sale of the Common stock, it will be subject to the prospectus delivery requirements of the Securities Act. The selling security holders will be responsible to comply with the applicable provisions of the Securities Act and Exchange Act, and the rules and regulations thereunder promulgated, including, without limitation, Regulation M, as applicable to such selling security holders in connection with resale of their respective shares under this Registration Statement.
The Company is required to pay all fees and expenses incident to the registration of the shares, but the Company will not receive any proceeds from the sale of the Common stock. The Company has agreed to indemnify the Selling security holders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act. If the selling security holders use this prospectus for any sale of the Common stock, they will be subject to the prospectus delivery requirements of the Securities Act.
LEGAL PROCEEDINGS
We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
Our directors, executive officers and significant employees are listed below. Director
Name Age Position with the Company/Principal Occupation Since
---- --- ---------------------------------------------- --------
Anju Tandon 36 Director, President, Secretary, Treasurer and 2/04
Chief Financial Officer
|
Anju Tandon was appointed Director, President, Secretary, Treasurer and Chief Financial Officer in February 2004 at the formation of the Company. Ms. Tandon has held executive positions with firms in the financial services industry including Arthur Andersen from 2000 to 2002 and Financial Security Assurance in prior years. She has also been involved as an entrepreneur in the apparel, home furnishings, travel and fashion accessories industries in prior years and since 2002. Ms. Tandon holds a Masters in Business Administration from Pace University and a B.A. from Fordham University.
Committees of the Board
As we currently have only one director we do not have separate audit, compensation or nominating committees.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Except as set forth in the footnotes to this table, the following table
sets forth information known to the Company with respect to the beneficial
ownership of its common stock as of December 22, 2004 for (i) all persons known
by the Company to own beneficially more than 5% of its outstanding common stock,
(ii) each of the Company's directors, (iii) each Named Executive Officer and
(iv) all directors and executive officers of the Company as a group.
Shares
Beneficially % of
5% Stockholders, Directors and Officers(1) Owned Total(2)
------------------------------------------ ----- --------
Anju Tandon (1) 2,000,000 90.9%
c/o TNT Designs, Inc
305 Madison Avenue, Suite 449
New York, NY 10165
----------
|
(1) Ms. Tandon is the Company's sole director and executive officer.
(2) Based on 2,200,000 shares outstanding as of December 22, 2004.
DESCRIPTION OF THE SECURITIES
Our authorized capital stock consists of 30 million shares of common stock. The following summarizes certain provisions of the common stock and does not purport to be complete and is subject to, and qualified in its entirety by the provisions of our Certificate of Incorporation, as amended.
Common Stock. At December 22, 2004, there were 2,200,000 shares of common stock outstanding, which were held of record by 13 registered stockholders. The holders of common stock are entitled to one vote per share on all matters to be voted upon by the stockholders. The holders of common stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by the Board of Directors out of funds legally available for that purpose. In the event of a liquidation, dissolution or winding up of the Company, the holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities, subject to prior distribution rights of preferred stock, if any, then authorized and outstanding. The common stock has no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund provisions applicable to the common stock.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES
Section 145 of the Delaware General Corporation Law permits a corporation to include in its charter documents, and in agreements between the corporation and its directors and officers, provisions expanding the scope of indemnification beyond that specifically provided by the current law.
Article VII of the Registrant's Certificate of Incorporation provides for the indemnification of directors to the fullest extent permissible under Delaware law.
Article VIII of the Registrant's Bylaws provides for the indemnification of officers, directors and third parties acting on behalf of the corporation if such person acted in good faith and in a manner reasonably believed to be in and not opposed to the best interest of the corporation, and, with respect to any criminal action or proceeding, the indemnified party had no reason to believe his conduct was unlawful.
Insofar as indemnification for liabilities arising under the Securites Act may be permitted to directors, officers and controlling persons of our company under Delaware law or otherwise, our company has been advised that the opinion of the Securites and Exchange Commission is that such indemnification is against public policy as expressed in the Securites Act of 1933, and is therefore, unenforceable.
DESCRIPTION OF BUSINESS
Overview
TNT Designs, Inc. is a New York City-based wholesaler and distributor of finer women's accessories and cosmetics which will distribute its products to retail and wholesale customers in New York City and New York State, and eventually throughout the United States as well as Europe and Asia. TNT is a Delaware corporation which was formed on February 17, 2004. We have an exclusive strategic alliance and distributorship agreement with Radico Export Import Ltd., a company in India, which manufactures a wide range of products. This relationship with Radico will allow us to concentrate on the marketing of our products. To date, our only activities have been organizational, directed towards negotiating and finalizing the strategic alliance with Radico, raising initial capital and developing our business plan. We have commenced limited activities with respect to commercial and other operations. We have no full time employees other than our President, own no real estate, and intend to intensify our commercial operations once we have become a publicly traded company and are able to raise additional capital.
Exclusive Distributorship and Alliance Agreement
On September 22, 2004, we signed an exclusive distributorship and alliance agreement with Radico Export Import, Ltd., a corporation formed under the laws of India. The agreement provides us with an exclusive right to market and distribute Radico's products in New York State. The consideration for this right was Radico's ability thereby to potentially sell more of its products through a U.S. distribution channel, which is in line with Radico's strategy of increasing export of its products in the United States.
We have exclusive and non-transferable rights granted under the agreement. Subject to certain preexisiting relationships which Radico has with a limited number of distributors in New York we are the only company authorized in New York State to import, market and distribute Radico products in the state for a period of five years, renewable for additional five year-periods upon expiration of the initial term. The agreement does not provide for any minimum shipment amounts. Nothing in the agreement prevents us from purchasing products from any other vendor or from development, marketing or distributing other fashion and beauty products.
Products
Radico is an India-based multinational organization engaged in the manufacture and export of beauty and fashion products and was formed in 1992 in India. Radico currently produces the following product lines under its own label: henna products, body dots/bindis, fashion handbags, belts, pashmina shawls and stoles, aroma candles and other aroma-based products, silver jewelry, fashion jewelry, embroidered dresses, scarves, Indian handicrafts, ayurvedic cosmetic products including hair coloring, moisturizers, anti-wrinkle creams, shampoo, and other cosmetics and promotional items.
Competition
The market for women's accessories and cosmetic products is highly competitive in all of the potential distribution channels and is fragmented. We believe that the market is highly price sensitive with service levels, quality, innovative packaging, marketing and promotional programs and unique products serving as the key factors influencing competition.
We believe that there are numerous businesses competing to distribute women's accessories and cosmetics both on the internet and in terms of traditional brick and mortar distribution channels. We are not able to fully assess the company's competitors as a number of such competitors are privately held businesses. However, we believe that we compete with large specialty retailers, traditional and better department stores, national apparel chains, designer boutiques, individual specialty apparel stores and other direct marketing firms. At the present time, we do not have to compete with these other businesses for merchandise since we only order merchandise for clients directly from Radico. Most of our competitors are larger, have greater financial resources and a more varied selection of products than we do. Our success is dependent in part upon initiating and maintaining strong relationships with our clients and the quality and value of the Radico products.
Distribution Methods and Marketing
We are developing a website at www.tntdesignsinc.com which will be used as a distribution outlet on the Internet to sell our products. We have also developed an eBay store at http://stores.ebay.com/TNT-Designs-Internet-Store. In addition to sales of our merchandise on the Internet, we plan to engage in direct selling of such products, which is defined as the sale of a consumer product or service in a face-to-face manner away from a fixed retail location. We, through our CEO, will market the Radico line through fashion trunk shows and private appointments with retail and wholesale consumers. For this distribution channel, we will rely on our mailing list and referrals in order to increase our customer base. We currently have a mailing list of approximately 300 names to which we will send e-mail announcements of the fashion trunk shows and preview shows during the year. The trunk shows will last for one day and will be by invitation. Customers will RSVP to view the current collection, will be able to try on different pieces and place orders. Radico also maintains multiple websites for its products, and since we are the exclusive distributor for Radico in New York State, we receive customer inquiries which are made directly to Radico from any potential customers in New York State.
In addition to selling Radico products, we also will act as fashion consultants to our retail customers. As a fashion consultant, we will teach people how to "accessorize" using the handbags, scarves and other products which we will sell and will assist the customers in evaluating which styles and color are the most suitable for them. We will act as a fashion consultant directly in connection with our selling of goods, and will not currently charge for this service because we believe that our customers, after consulting with us, will tend to purchase more items in order to update or create a new look.
Sources and Availability of Raw Materials
We believe that the major raw materials used by Radico in the manufacture of the products from its suppliers which will be distributed by us are readily available from numerous sources and that the loss of these suppliers would not adversely affect operations.
Trademarks and Patents
We currently have no trademarks or patent protection.
Government Regulations
Our planned business operations are not currently subject to governmental regulations.
Research and Development
We do not currently conduct any primary research with respect to the development, marketing and distribution of new products. We are focused upon relying on new products developed by Radico, and will in the future acquire distribution rights for new products and develop packaging in response to market trends and consumer demands. We intend to develop a product mix in response to changes in market trends and consumer demands in order to maintain product comparability in our target markets.
Facilities
We have no material assets and do not own any material real or personal property. We maintain a mailing address at 305 Madison Avenue, Suite 449, New York, New York 10165 for which we pay a nominal fee of approximately $60 per month. We believe that this arrangement is sufficient for our purposes at this time. We do not believe that we will need to obtain additional office space at the present time, but we anticipate requiring additional office space in the future once our business plan is further developed. We do not require any warehouse or shipping facilities due to our relationship with Radico.
Employees
As of December 22, 2004, we had one part-time employee, our President, who is our sole officer and director. There are no collective bargaining agreements or employment agreements in existence with respect to the company.
Risk Factors
See Risk Factors beginning on page 3 of this prospectus.
PLAN OF OPERATION
The following information should be read in conjunction with the financial statements and related notes that are provided as a part of this prospectus.
Information we provide in this prospectus or statements made by our sole director, officer and employee may constitute "forward-looking" statements and may be subject to numerous risks and uncertainties. Any statements made in this prospectus, including any statements incorporated herein by reference, that are not statements of historical fact are forward-looking statements (including, but not limited to, statements concerning the characteristics and growth of our market and customers, our objectives and plans for future operations and products and our liquidity and capital resources). Such forward-looking statements are based on current expectations and are subject to uncertainties and other factors which may involve known and unknown risks that could cause actual results of operations to differ materially from those projected or implied. Further, certain forward-looking statements are based upon assumptions about future events which may not prove to be accurate.
The forward-looking information set forth in this prospectus is as of December 22, 2004, and TNT undertakes no duty to update this information. Should events occur subsequent to December 22, 2004 that make it necessary to update the forward-looking information contained in this Prospectus, the updated forward-looking information will be filed with the SEC in a Quarterly Report on Form 10-QSB, as an earnings or other release included as an exhibit to a Form 8-K or as an amendment to this registration statement, each of which will be available at the SEC's website at www.sec.gov. More information about potential factors that could affect our business and financial results is included in the section entitled "Risk Factors" beginning on page 3 of this prospectus.
Overview
We were incorporated pursuant to the laws of Delaware on February 17, 2004. We have entered into our first strategic alliance and distribution agreement with Radico Export Import, Ltd., a corporation formed under the laws of India. This agreement provides us with an exclusive right to market and distribute Radico's products in the New York State. We intend to negotiate an expansion of the geographic scope of this agreement with Radico such that the exclusivity extends throughout the United States, and also worldwide. We also intend to enter into additional exclusive distribution arrangements with other similarly situated companies located in India.
Our plan of operation for the twelve months following the date of this prospectus is to market and distribute Radico's products to the potential customers on our mailing lists and databases. We intend to do this via our website our Ebay store as well as direct selling to retail and wholesale customers through tradeshows, trunk shows and our network of contacts. We anticipate that the average cost to conduct a trunk show for our products will be $5,000, which includes the costs for transportation, rental space, inventory, staffing and marketing and printing costs. We anticipate that the average cost to participate in an industry tradeshow will be $15,000, which includes the costs for transportation, booth rental, inventory, staffing and marketing and printing costs.
We do not plan to conduct any product research and development, purchase any significant equipment or increase our number of employees in the next 12 months. We will focus our efforts on sales and marketing of our products. In addition, we will attempt to expand our base of customers as well as suppliers in India.
We anticipate spending an additional $30,000 on administrative costs such as accounting and auditing fees, professional fees, including fees payable in connection with the filing of this registration statement and complying with reporting obligations.
Total expenditures over the next 12 months are therefore expected to be in excess of $120,000 which includes the costs of doing six trunk shows, participating in two tradeshows, and general sales and marketing expenses of $30,000.
At September 30, 2004, our total assets consisted of $16,903, including cash on hand at that date. Accordingly, we will have to raise additional funds in the next twelve months in order implement our business plan and expand our operations. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We may also seek to obtain short-term loans from our directors, although no such arrangement has been made. We do not have any arrangements in place for any future equity financing.
DESCRIPTION OF PROPERTY
We currently maintain our executive offices at 305 Madison Avenue, Suite 449, New York New York 10165 under a lease that is month to month. We believe that our current office space is adequate for our current operations and we do not anticipate that we will require any additional premises in the foreseeable future.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
MARKET FOR COMMON STOCK AND RELATED STOCKHOLDER MATTERS
Our common stock is not currently traded on any recognized stock exchange. There is no current public trading market for our shares of common stock. After this Registration Statement becomes effective, we intend to apply for a quotation on the OTC Bulletin Board. While we intend to take needed action to qualify our common shares for quotation on the NASD OTCBB, there is no assurance that we can satisfy the current listing standards.
As of December 22, 2004, we had 13 shareholders holding 2,200,000 shares of our common stock.
EXECUTIVE COMPENSATION
No executive compensation has been paid since our inception nor are there any plans to accrue them to date.
FINANCIAL STATEMENTS
The Company's Financial Statements for the period February 17, 2004 (inception) to September 30, 2004 are included on pages F-1 through F-8 of this prospectus.
INTEREST OF NAMED EXPERTS AND COUNSEL
The financial statements of TNT Designs, Inc. as of September 30, 2004, are included on pages F-1 through F-8 in this registration statement in reliance upon the report of Most & Company, LLP, independent auditors, and upon the authority of said firm as experts in accounting and auditing.
The validity of the issuance of the shares being offered hereby will be passed upon for us by Baratta & Goldstein, New York, New York. A portion of the shares being registered herein are being issued to TNT's' attorney in such law firm for services provided to TNT.
The Remainder of This Page Intentionally Left Blank
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law permits a corporation to include in its charter documents, and in agreements between the corporation and its directors and officers, provisions expanding the scope of indemnification beyond that specifically provided by the current law.
Article VII of the Registrant's Certificate of Incorporation provides for the indemnification of directors to the fullest extent permissible under Delaware law.
Article VIII of the Registrant's Bylaws provides for the indemnification of officers, directors and third parties acting on behalf of the corporation if such person acted in good faith and in a manner reasonably believed to be in and not opposed to the best interest of the corporation, and, with respect to any criminal action or proceeding, the indemnified party had no reason to believe his conduct was unlawful.
Item 25. Other Expenses of Issuance and Distribution.
SEC registration fees $ 8.87
Legal fees and expenses $15,000.00*
Accountants' fees $ 4,000.00
Miscellaneous $ 1,000.00
----------
Total $20,008.87
==========
|
* A portion of the legal fees and expenses represented by common stock included in this registration statement.
Item 26. Recent Sales of Unregistered Securities
Private Placements of Common Stock
In February 2004, the Company sold 2,000,000 shares of common stock to its sole officer and director for $200. In May of 2004, the Company completed a Private Placement under Regulation D whereby it issued 100,000 shares of common stock to ten subscribers and received an aggregate of $10,000.
Common Stock Issued for Services Provided
In December 2004, the Company issued 100,000 shares of common stock to Joseph Baratta for legal as consideration for legal services performed for the Company.
Item 27. Exhibits.
The exhibits filed as part of this Registration Statement are as follows:
3.1 Bylaws of the Registrant
3.2 Certificate of Incorporation of TNT Designs Inc, a Delaware corporation, filed February 17, 2004.
5.1 Opinion of Baratta & Goldstein*
10.1 Form of Subscription Agreement for the Company's Private Placement dated as of May 2004
10.2 Alliance Agreement with Radico Export Import Ltd dated September 22, 2004.
23.1 Consent of Most & Company, LLP, Independent Registered Public Accounting Firm.
23.2 Consent of Baratta & Goldstein (included in opinion filed as Exhibit 5.1).
* To be filed by amendment.
II-1
Item 28. Undertakings
(a) The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended;
(ii) to reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof), which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and
(iii)to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement.
2. That, for the purpose of determining any liability under the Securities Act of 1933, as amended, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
4. The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as
amended, each filing of the Registrant's Annual Report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934, as amended, that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
5. Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the "Act"), may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
6. The undersigned registrant hereby undertakes to deliver or cause to be delivered with the prospectus, to each person to whom the prospectus is sent or given, the latest annual report to security holders that is incorporated by reference in the prospectus and furnished pursuant to and meeting the requirements of Rule 14-a or Rule 14c-3 under the Securities Exchange Act of 1934, as amended; and, where interim financial information required to be presented by Article 3 of Regulations S-X are not set forth in the prospectus, to deliver, or cause to be delivered to each person to whom the prospectus is sent or given, the latest quarterly report that is specifically incorporated by reference in the prospectus to provide such interim financial information.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant, TNT Designs, Inc, certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form SB-2 and has duly caused this Registration Statement on Form SB-2 to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of New York, State of New York, on the 23 day of December, 2004.
TNT Designs, Inc.
By: /s/ Anju Tandon
===================================================
Anju Tandon
Director, President, Secretary, Treasurer and Chief
Financial Officer
|
II-3
EXHIBIT INDEX
3.1 Bylaws of the Registrant
3.2 Certificate of Incorporation of TNT Designs Inc, a Delaware corporation, filed February 17, 2004.
5.1 Opinion of Baratta & Goldstein*
10.1 Form of Subscription Agreement for the Company's Private Placement dated as of May 2004
10.2 Alliance Agreement with Radico Export Import Ltd dated September 22, 2004.
23.1 Consent of Most & Company, LLP, Independent Registered Public Accounting Firm.
23.2 Consent of Baratta & Goldstein (included in opinion filed as Exhibit 5.1).
* To be filed by amendment.
II-4
TNT DESIGNS, INC.
(A Development Stage Enterprise)
Report of Independent Public Accounting Firm
To the Board of Directors and
Stockholders of TNT Designs, Inc.
We have audited the accompanying balance sheet of TNT Designs, Inc. (A Development Stage Enterprise) as of September 30, 2004 and the related statements of operations, stockholders' equity and cash flows for the period from February 17, 2004 (inception) to September 30, 2004. 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 audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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 audit provides 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 TNT Designs, Inc. as of September 30, 2004 and the results of its operations and cash flows for the period from February 17, 2004 (inception) to September 30, 2004 in conformity with accounting principles generally accepted in the United States.
/s/ Most & Company, LLP
Most & Company, LLP
New York, New York
October 14, 2004
|
TNT DESIGNS, INC.
(A Development Stage Enterprise)
Balance Sheet
September 30, 2004
ASSETS
Current Assets
Cash $ 15,907
Inventory 996
--------
Total Assets $ 16,903
========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Due to stockholder/officer $ 9,110
--------
Stockholders' Equity
Common stock, $.0001 par value; authorized: 30,000,000 shares;
issued and outstanding: 2,100,000 shares 210
Additional paid-in capital 9,990
Accumulated deficit (2,407)
--------
Total Stockholders' Equity 7,793
--------
Total Liabilities and Stockholders' Equity $ 16,903
========
|
See notes to the financial statements.
TNT DESIGNS, INC.
(A Development Stage Enterprise)
Statement of Operations
February 17, 2004 (Inception) to September 30, 2004
General and Administrative Expenses $ 2,407
----------
Net Loss $ 2,407
==========
Basic loss per share $ *
==========
Basic weighted average number of
shares outstanding 2,070,551
==========
|
* Less than $0.01, per share
See notes to the financial statements.
TNT DESIGNS, INC.
(A Development Stage Enterprise)
Statement of Stockholders' Equity
February 17, 2004 (Inception) to September 30, 2004
Common Stock Additional
-------------------- Paid-in Accumulated
Shares Amount Capital Deficit TOTAL Total
--------- --------- --------- --------- --------- ---------
Sale of common stock to officer,
at $.0001, per share (February 17, 2004) 2,000,000 $ 200 $ 200 200
Sale of common stock under private placement,
at $.10, per share, (March to May 2004) 100,000 10 $ 9,990 10,000 10,000
Net loss $ (2,407) (2,407) (2,407)
--------- --------- --------- --------- --------- ---------
Balance, September 30, 2004 2,100,000 $ 210 $ 9,990 $ (2,407) $ 7,793 7,793
========= ========= ========= ========= ========= =========
|
See notes to the financial statements.
TNT DESIGNS, INC.
(A Development Stage Enterprise)
Statement of Cash Flows
February 17, 2004 (Inception) to September 30, 2004
Cash flow from operating activities
Net loss $ (2,407)
Adjustments to reconcile net loss
to cash used in operating activities
Increase in inventory (996)
--------
Cash used in operating activities (3,403)
--------
Cash flow from financing activities
Proceeds from sales of common stock 10,200
Increase in due to stockholder/officer 9,110
--------
Cash provided by financing operations 19,310
--------
Increase in cash and cash at September 30, 2004 $ 15,907
========
|
See notes to the financial statements.
TNT DESIGNS, INC.
(A Development Stage Enterprise)
Notes to Financial Statements
1. ORGANIZATION AND OPERATIONS
TNT Designs, Inc. (Company) was incorporated in Delaware on February 17, 2004. The Company markets and distributes women's fashion accessories and beauty products from India. All activity to date was related to the Company's organization and distributions and alliance agreement.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The financial statements include all the accounts of the Company.
Inventory
Inventory, consisting of finished goods, is stated at the lower of cost or market determined by the first-in, first-out method.
Income Taxes
Deferred income taxes are provided for temporary differences between financial statement and income tax reporting under the liability method, using expected tax rates and laws that are expected to be in effect when the differences are expected to reverse.
Net Loss Per Share
Basic net loss per share was computed by dividing the net loss for the period by the basic weighted average number of shares outstanding during the year. Diluted net loss per share was not presented as it was anti-dilutive.
Financial Instruments
The carrying amounts of financial instruments, including cash and due to stockholder/officer, approximate their fair values because of their relatively short maturities.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Actual results could differ from those estimates.
New Accounting Pronouncements
Management does not believe that any recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying financial statements.
3. DUE TO STOCKHOLDER/OFFICER
Due to stockholder/officer is payable on demand without interest. The Company purchased inventory of $996 from the stockholder/officer.
4. INCOME TAX
As of September 30, 2004, realization of the Company's net deferred tax asset of approximately $1,000 was not considered more likely than not and, accordingly, a valuation allowance of approximately $1,000 was provided.
5. COMMON STOCK
Upon incorporation, the Company authorized 30,000,000 shares of $.0001 par value common stock.
In February 2004, the Company sold 2,000,000 shares of common stock to an officer for $200.
In March, April and May 2004, the Company sold 100,000 shares of common stock under a private placement in exchange for $10,000 ($.10, per share).
6. DISTRIBUTION AND ALLIANCE AGREEMENT
On September 22, 2004, the Company entered into an exclusive distribution and alliance agreement with a manufacturer located in India. Under the agreement, the Company has an exclusive right to distribute the manufacturer's products in New York State for five years.
7. SUBSEQUENT EVENTS
On October 12, 2004, the Company entered into a retainer agreement for legal services in connection with the review and draft of a proposed Form SB-2. The fee for this service is $15,000, payable $5,000 in cash, upon signing, and $10,000 in cash or shares of common stock to be determined within a year from filing the Form SB-2.
On December 17, 2004, the Company issued 100,000 shares of common stock in exchange for the $10,000 due under the retainer agreement.
BYLAWS
OF
TNT DESIGNS, INC.
(A DELAWARE CORPORATION)
BYLAWS
OF
TNT DESIGNS, INC.
TABLE OF CONTENTS
PAGE
ARTICLE I OFFICES ................................................................................................1
Section 1. Registered Office and Agent..............................................................1
Section 2. Other Offices............................................................................1
ARTICLE II MEETINGS OF STOCKHOLDERS...............................................................................1
Section 1. Time and Place of Meetings...............................................................1
Section 2. Annual Meetings..........................................................................1
Section 3. Special Meetings.........................................................................2
Section 4. Quorum...................................................................................2
Section 5. Voting...................................................................................2
Section 6. Consent of Stockholders in Lieu of Meeting...............................................2
Section 7. List of Stockholders Entitled to Vote....................................................3
Section 8. Stock Ledger.............................................................................3
Section 9. Meeting by Remote Communication..........................................................3
ARTICLE III DIRECTORS ............................................................................................4
Section 1. Number and Election of Directors.........................................................4
Section 2. Vacancies................................................................................4
Section 3. Duties and Powers........................................................................4
Section 4. Meetings.................................................................................4
Section 5. Quorum...................................................................................4
Section 6. Actions of Board.........................................................................4
Section 7. Meetings by Means of Conference Telephone................................................4
Section 8. Committees...............................................................................5
Section 9. Compensation.............................................................................5
Section 10. Interested Directors.....................................................................5
ARTICLE IV OFFICERS ..............................................................................................5
Section 1. General..................................................................................5
Section 2. Election.................................................................................6
Section 3. Voting Securities Owned by the Corporation...............................................6
Section 4. Chairman of the Board of Directors.......................................................6
Section 5. President................................................................................6
Section 6. Vice Presidents..........................................................................6
Section 7. Secretary................................................................................7
Section 8. Treasurer................................................................................7
Section 9. Assistant Secretaries....................................................................7
Section 10. Assistant Treasurers.....................................................................7
Section 11. Other Officers...........................................................................7
|
ARTICLE V STOCK .........................................................................................8
Section 1. Form of Certificates.....................................................................8
Section 2. Signatures...............................................................................8
Section 3. Lost Certificates........................................................................8
Section 4. Transfers................................................................................8
Section 5. Record Date..............................................................................8
Section 6. Beneficial Owners........................................................................8
ARTICLE VI NOTICES ...............................................................................................8
Section 1. Notices..................................................................................9
Section 2. Waivers of Notice........................................................................9
ARTICLE VII GENERAL PROVISIONS....................................................................................9
Section 1. Dividends................................................................................9
Section 2. Disbursements............................................................................9
Section 3. Fiscal Year..............................................................................9
Section 4. Corporate Seal...........................................................................9
ARTICLE VIII INDEMNIFICATION.....................................................................................9
Section 1. Power to Indemnify in Actions, Suits or Proceedings other Than Those by or in the Right
of the Corporation.......................................................................9
Section 2. Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the
Corporation ............................................................................10
Section 3. Authorization of Indemnification........................................................10
Section 4. Good Faith Defined......................................................................10
Section 5. Indemnification by a Court..............................................................11
Section 6. Expenses Payable in Advance.............................................................11
Section 7. Nonexclusivity of Indemnification and Advancement of Expenses...........................11
Section 8. Insurance...............................................................................11
Section 9. Certain Definitions.....................................................................11
Section 10. Survival of Indemnification and Advancement of Expenses.................................12
Section 11. Limitation on Indemnification...........................................................12
Section 12. Indemnification of Employees and Agents.................................................12
ARTICLE IX AMENDMENTS ...........................................................................................12
Section 1. Amendments..............................................................................12
|
BYLAWS
OF
TNT DESIGNS, INC.
(the "Corporation")
ARTICLE I
OFFICES
Section 1. Registered Office and Agent. The registered office and registered agent of the Corporation shall be set forth in the Certificate of Incorporation of the Corporation, as may be amended from time to time.
Section 2. Other Offices. 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.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. Time and Place of Meetings. Meetings of the stockholders for the election of directors or for any other purpose shall be held at such times and places, 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 or in a duly executed waiver of notice thereof. The Board of Directors may, in its sole discretion, determine that the meeting shall not be held at any place but may instead be held solely by means of remote communication. Stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication participate in a meeting of stockholders and be deemed present in person and vote at a meeting of stockholders whether such meeting is to be held at a designated place or solely by means of remote communication provided (a) the Corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote by remote communication is a stockholder or proxyholder, (b) the Corporation shall implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings, and (c) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the Corporation.
Section 2. Annual Meetings. The Annual Meetings of Stockholders shall be
held on the 15th day of September in each year (if not a legal holiday, and, if
a legal holiday, then on the next business day) or at such other date and at
such time as shall be designated from time to time by the Board of Directors and
stated in the notice of the meeting, at which meetings the stockholders shall
elect by a plurality vote a Board of Directors, and transact such other business
as may properly be brought before the meeting. All election of directors shall
be by written ballot. The Board of Directors may authorize that requirement of a
written ballot shall be satisfied by a ballot submitted by electronic
transmission, provided that any such electronic transmission must either set
forth or be submitted with information from which it can be determined that the
electronic transmission was authorized by the stockholder or proxyholder.
Written notice of the Annual Meeting stating the place, if any, date and hour of
the meeting, the means of remote communications, if any, by which stockholders
and proxyholders may be deemed to be present in person and vote at such 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. Any notice
given to the stockholders by the Corporation under the Certificate of
Incorporation, or these Bylaws shall be effective if given by a form of
electronic transmission consented to by the stockholder to whom the notice is
given. The consent shall be revocable by the stockholder by written notice to
the Corporation. Any such consent shall be deemed revoked if (a) the Corporation
is unable to deliver by electronic transmission two consecutive notices given by
the Corporation in accordance with such consent and (b) such inability becomes
known to the Secretary or an Assistant Secretary of the Corporation or to the
transfer agent, or other person responsible for the giving of notice.
Inadvertent failure to treat such inability as a revocation shall not invalidate
any meeting or other action. Notice by electronic transmission shall be deemed
given (a) if by facsimile telecommunication, when directed to a number at which
the stockholder has consented to receive notice; (b) if by electronic mail, when
directed to an electronic mail address at which the stockholder has consented to
receive notice; (c) if by posting on an electronic network together with
separate notice to the stockholder of such specific posting, upon the later of
(i) such posting and (ii) the giving of such separate notice; and (d) if by any
other form of electronic transmission , when directed to the stockholder.
Section 3. Special Meetings. Unless otherwise prescribed by law or by the
Certificate of Incorporation, Special Meetings of Stockholders, for any purpose
or purposes, may be called by either (i) the Chairman, if there be one, or (ii)
the President, (iii) any Vice President, if there be one, (iv) the Secretary or
(v) any Assistant Secretary, if there be one, and shall be called by any such
officer at the request in writing of a majority of the Board of Directors or at
the request in writing of stockholders owning a majority of the capital stock of
the Corporation issued and outstanding and entitled to vote. Such request shall
state the purpose or purposes of the proposed meeting. 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 days before the date of the meeting to each stockholder entitled
to vote at such meeting.
Section 4. Quorum. Except as otherwise provided by law or by the Certificate of Incorporation, the holders of a majority of the capital 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 stockholders for the transaction of business. 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 noticed. 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 entitled to vote at the meeting.
Section 5. Voting. Unless otherwise required by law, the Certificate of Incorporation or these Bylaws, any question brought before any meeting of stockholders shall be decided by the vote of the holders of a majority of the stock represented and entitled to vote thereat. Each stockholder represented at a meeting of stockholders shall be entitled to cast one vote for each share of the capital stock entitled to vote thereat held by such stockholder. Such votes may be cast in person or by proxy but no proxy shall be voted on or after three years from its date, unless such proxy provides for a longer period. The Board of Directors, in its discretion, or the officer of the Corporation presiding at a meeting of stockholders, in his discretion, may require that any votes cast at such meeting shall be cast by written ballot.
Section 6. Consent of Stockholders in Lieu of Meeting. Unless otherwise provided in the Certificate of Incorporation, any action required or permitted to be taken at any Annual or Special Meeting of Stockholders of the Corporation, 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. An electronic transmission consenting to an action to be taken and transmitted by a stockholder or proxyholder, shall be deemed to be written, signed and dated provided that any such electronic transmission sets forth or is delivered with information from which the Corporation can determine (a) that the electronic transmission was transmitted by the stockholder or proxyholder and (b) the date on which the stockholder or proxyholder transmitted the electronic transmission. The date on which the electronic transmission is transmitted shall be deemed to be the date on which such consent was signed. No consent given by electronic transmission shall be deemed to have been delivered until such consent is reproduced in paper form and until such paper form shall be delivered to the Corporation by delivery to the registered office of the Corporation in the State of Delaware, its principal place of business or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation's registered office shall be made by hand or by certified or registered mail, return receipt requested. The Board of Directors may, by resolution provide that the consent by electronic transmission may be delivered to the Corporation's principal place of business or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded.
Section 7. List of Stockholders Entitled to Vote. The officer of the Corporation 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 the examination of any stockholder, for any purpose germane to the meeting, for a period of at least ten days prior to the meeting, (a) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (b) during ordinary business hours, at the principal place of business of the Corporation. If the list is made available on an electronic network, the Corporation shall take reasonable steps to ensure that the information is available only to stockholders of the Corporation. If the meeting is to be held at a place, the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder of the Corporation who is present. If the meeting is to be held solely by means of remote communication, then the list shall be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such a list shall be provided with the notice of the meeting.
Section 8. Stock Ledger. The stock ledger of the Corporation shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by Section 7 of this Article II or the books of the Corporation, or to vote in person or by proxy at any meeting of stockholders.
Section 9. Meeting by Remote Communication. Shareholders may participate in and hold a meeting by means of remote communication, including conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, provided that (i) the Corporation implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder, (ii) the Corporation implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings, and (iii) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the corporation. Participation in a meeting by such means shall constitute presence in person at the meeting.
ARTICLE III
DIRECTORS
Section 1. Number and Election of Directors. The Board of Directors shall consist of not less than one nor more than eleven members, the exact number of which shall initially be fixed by the Incorporator. Thereafter, subject to any limitations specified by law or in the Certificate of Incorporation, the number of directors may be increased or decreased by resolution adopted by a majority of the Board of Directors. Except as provided in Section 2 of this Article, directors shall be elected by a plurality of the votes cast at Annual Meetings of Stockholders, and each director so elected shall hold office until the next Annual Meeting and until his successor is duly elected and qualified, or until his earlier resignation or removal. Any director may resign at any time upon notice to the Corporation. Directors need not be stockholders.
Section 2. Vacancies. 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 qualified, or until their earlier resignation or removal.
Section 3. Duties and Powers. The business of the Corporation shall be managed by or under the direction of the 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 Bylaws directed or required to be exercised or done by the stockholders.
Section 4. Meetings. The Board of Directors of the Corporation may hold meetings, both regular and special, either within or without the State of Delaware. Regular meetings of the Board of Directors may be held without notice at such time and at such place as may from time to time be determined by the Board of Directors. Special meetings of the Board of Directors may be called by the Chairman, if there be one, the President, or any directors. Notice thereof stating the place, date and hour of the meeting shall be given to each director either by mail not less than two (2) days before the date of the meeting, by telephone or telegram on twenty-four (24) hours notice, or on such shorter notice as the person or persons calling such meeting may deem necessary or appropriate in the circumstances.
Section 5. Quorum. Except as may be otherwise specifically provided by law, the Certificate of Incorporation or these Bylaws, at all meetings of the Board of Directors, a majority of the entire Board of 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. 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 6. Actions of Board. Unless otherwise provided by the Certificate of Incorporation or these Bylaws, 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 the members of the Board of Directors or committee, as the case may be, consent thereto in writing, or by electronic transmission and the writing or writings or electronic transmission or electronic transmissions are filed with the minutes of proceedings of the Board of Directors or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.
Section 7. Meetings by Means of Conference Telephone. Unless otherwise provided by the Certificate of Incorporation or these Bylaws, members of the Board of Directors of the Corporation, or any committee designated by the Board of Directors, may participate in a meeting of the Board of Directors or such committee by means of a conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this Section 7 shall constitute presence in person at such meeting.
Section 8. Committees. The Board of Directors may, by resolution passed by a majority of the entire Board of Directors, designate one or more committees, each committee to consist of one or more of the directors of the Corporation. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of any such committee. In the absence or disqualification of a member of a committee, and in the absence of a designation by the Board of Directors of an alternate member to replace the absent or disqualified member, 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 absent or disqualified member. Any committee, to the extent allowed by law and provided in the resolution establishing such committee, 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. Each committee shall keep regular minutes and report to the Board of Directors when required. The Committees may create one or more subcommittees and may delegate to the subcommittee all or part of the authority granted to the committee.
Section 9. Compensation. 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 10. Interested Directors. No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association, or other organization in which one or more of its directors or officers are directors or officers, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or committee thereof which authorizes the contract or transaction, or solely because his or their votes are counted for such purpose if (i) the material facts as to his or their relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (ii) the material facts as to his or their relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (iii) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved or ratified, by the Board of Directors, a committee thereof or the stockholders. Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction.
ARTICLE IV
OFFICERS
Section 1. General. The officers of the Corporation shall consist of a President, a Secretary, and a Treasurer. The Board of Directors, in its discretion, may also choose a Chairman of the Board of Directors (who must be a director) and one or more Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers. Any number of offices may be held by the same person, unless otherwise prohibited by law, the Certificate of Incorporation or these Bylaws. The officers of the Corporation need not be stockholders of the Corporation nor, except in the case of the Chairman of the Board of Directors, do such officers need be directors of the Corporation.
Section 2. Election. The Board of Directors at its first meeting held after each Annual Meeting of Stockholders shall elect the officers of the Corporation 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 of Directors; and all officers of the Corporation shall hold office until their successors are chosen and qualified, or until their earlier resignation or removal. Any officer elected 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 salaries of all officers of the Corporation shall be fixed by the Board of Directors.
Section 3. Voting Securities Owned by the Corporation. Powers of attorney, proxies, waivers of notice of meeting, consents and other instruments relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the President or any Vice President and any such officer may, in the name of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any meeting of security holders of any corporation in which the Corporation may own securities and at any such meeting shall possess and may exercise any and all rights and power incident to the ownership of such securities and which, as the owner thereof, the Corporation might have exercised and possessed if present. The Board of Directors may, by resolution, from time to time confer like powers upon any other person or persons.
Section 4. Chairman of the Board of Directors. The Chairman of the Board of Directors, if there be one, shall preside at all meetings of the stockholders and of the Board of Directors. He shall be the Chief Executive Officer of the Corporation, and except where by law the signature of the President is required, the Chairman of the Board of Directors shall possess the same power as the President to sign all contracts, certificates and other instruments of the Corporation which may be authorized by the Board of Directors. During the absence or disability of the President, the Chairman of the Board of Directors shall exercise all the powers and discharge all the duties of the President. The Chairman of the Board of Directors shall also perform such other duties and may exercise such other powers as from time to time may be assigned to him by these Bylaws or by the Board of Directors.
Section 5. President. The President shall, subject to the control of the Board of Directors and, if there be one, the Chairman of the Board of Directors, have general supervision of the business of the Corporation and shall see that all orders and resolutions of the Board of Directors are carried into effect. He shall execute all bonds, mortgages, contracts and other instruments of the Corporation requiring a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except that the other officers of the Corporation may sign and execute documents when so authorized by these Bylaws, the Board of Directors or the President. In the absence or disability of the Chairman of the Board of Directors, or if there be none, the President shall preside at all meetings of the stockholders and the Board of Directors. If there be no Chairman of the Board of Directors, the President shall be the Chief Executive Officer of the Corporation. The President shall also perform such other duties and may exercise such other powers as from time to time may be assigned to him by these Bylaws or by the Board of Directors.
Section 6. Vice Presidents. At the request of the President or in his absence or in the event of his inability or refusal to act (and if there be no Chairman of the Board of Directors), the Vice President or the Vice Presidents if there is more than one (in the order designated by the Board of Directors) 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. Each Vice President shall perform such other duties and have such other powers as the Board of Directors from time to time may prescribe. If there be no Chairman of the Board of Directors and no Vice President, the Board of Directors shall designate the officer of the Corporation who, in the absence of the President or in the event of the inability or refusal of the President to act, 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.
Section 7. Secretary. The Secretary shall attend all meetings of the Board of Directors and all meetings of stockholders and record all the proceedings thereat in a book or books to be kept for that purpose; the Secretary shall also perform like duties for the standing committees when required. The Secretary 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. If the Secretary shall be unable or shall refuse to cause to be given notice of all meetings of the stockholders and special meetings of the Board of Directors, and if there be no Assistant Secretary, then either the Board of Directors or the President may choose another officer to cause such notice to be given. The Secretary shall have custody of the seal of the Corporation and the Secretary or any Assistant Secretary, if there be one, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by the signature of the Secretary or by the signature of any 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. The Secretary shall see that all books, reports, statements, certificates and other documents and records required by law to be kept or filed are properly kept or filed, as the case may be.
Section 8. Treasurer. 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. The Treasurer 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. If required by the Board of Directors, the Treasurer shall give the Corporation a bond 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 9. Assistant Secretaries. Except as may be otherwise provided in these Bylaws, Assistant Secretaries, if there be any, shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors, the President, any Vice President, if there be one, or the Secretary, and in the absence of the Secretary or in the event of his disability or refusal to act, shall perform the duties of the Secretary, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Secretary.
Section 10. Assistant Treasurers. Assistant Treasurers, if there be any, shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors, the President, any Vice President, if there be one, or the Treasurer, and in the absence of the Treasurer or in the event of his disability or refusal to act, shall perform the duties of the Treasurer, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Treasurer. If required by the Board of Directors, an Assistant Treasurer shall give the Corporation a bond 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 11. Other Officers. Such other officers as the Board of Directors may choose shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors. The Board of Directors may delegate to any other officer of the Corporation the power to choose such other officers and to prescribe their respective duties and powers.
ARTICLE V
STOCK
Section 1. Form of Certificates. Every holder of stock in the Corporation
shall be entitled to have a certificate signed, in the name of the Corporation
(i) by the Chairman of the Board of Directors, the President or a Vice President
and (ii) by the Treasurer or an Assistant Treasurer, or the Secretary or an
Assistant Secretary of the Corporation, certifying the number of shares owned by
him in the Corporation.
Section 2. Signatures. Where a certificate is countersigned by (i) a transfer agent other than the Corporation or its employee, or (ii) a registrar other than the Corporation or its employee, any other signature on the certificate may be a 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 certificate 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 to be issued in place of any certificate 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 of stock to be lost, stolen or destroyed. When authorizing such issue of a new certificate, 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 his legal representative, to advertise the same in such manner as the Board of Directors 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. Transfers. Stock of the Corporation shall be transferable in the manner prescribed by law and in these Bylaws. Transfers of stock shall be made on the books of the Corporation only by the person named in the certificate or by his attorney lawfully constituted in writing and upon the surrender of the certificate therefor, which shall be canceled before a new certificate shall be issued.
Section 5. Record Date. In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or entitled 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 days 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. Beneficial Owners. 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 any 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 law.
ARTICLE VI
NOTICES
Section 1. Notices. Whenever written notice is required by law, the Certificate of Incorporation or these Bylaws, to be given to any director, member of a committee or stockholder, such notice may be given by mail, addressed to such director, member of a committee 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 States mail. Written notice may also be given personally or by telegram, telex or cable. Without limiting the manner by which notice may otherwise be given effectively to stockholders, any notice to stockholders may be given by electronic transmission in the manner provided in Section 232 of the Delaware General Corporation Law.
Section 2. Waivers of Notice. Whenever any notice is required by law, the Certificate of Incorporation or these Bylaws, to be given to any director, member of a committee or stockholder, a waiver thereof in writing, signed, by the person or persons entitled to said notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent thereto.
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 be declared by the Board of Directors at any regular or special meeting and may be paid in cash, in property, or in shares of the capital stock. 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 Board of Directors from time to time, in its absolute discretion, deems 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 any proper purpose, and the Board of Directors may modify or abolish any such reserve.
Section 2. Disbursements. 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 3. Fiscal Year. The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.
Section 4. Corporate 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 impressed or affixed or reproduced or otherwise.
ARTICLE VIII
INDEMNIFICATION
Section 1. Power to Indemnify in Actions, Suits or Proceedings other Than Those by or in the Right of the Corporation. Subject to Section 3 of this Article VIII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation) by reason of the fact that he is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director or officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was unlawful.
Section 2. Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation. Subject to Section 3 of this Article VIII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that he is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.
Section 3. Authorization of Indemnification. Any indemnification under
this Article VIII (unless ordered by a court) shall be made by the Corporation
only as authorized in the specific case upon a determination that
indemnification of the director or officer is proper in the circumstances
because he has met the applicable standard of conduct set forth in Section 1 or
Section 2 of this Article VIII, as the case may be. Such determination shall be
made (i) by the Board of Directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or proceeding, or (ii) if
such a quorum is not obtainable, or, even if obtainable a quorum of
disinterested directors so directs, by independent legal counsel in a written
opinion, or (iii) by the stockholders. To the extent, however, that a director
or officer of the Corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding described above, or in defense of any
claim, issue or matter therein, he shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection therewith, without the necessity of authorization in the specific
case.
Section 4. Good Faith Defined. For purposes of any determination under
Section 3 of this Article VIII, a person shall be deemed to have acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the Corporation, or, with respect to any criminal action or
proceeding, to have had no reasonable cause to believe his conduct was unlawful,
if his action is based on the records or books of account of the Corporation or
another enterprise, or on information supplied to him by the officers of the
Corporation or another enterprise in the course of their duties, or on the
advice of legal counsel for the Corporation or another enterprise or on
information or records given or reports made to the Corporation or another
enterprise by an independent certified public accountant or by an appraiser or
other expert selected with reasonable care by the Corporation or another
enterprise. The term another enterprise as used in this Section 4 shall mean any
other corporation or any partnership, joint venture, trust, employee benefit
plan or other enterprise of which such person is or was serving at the request
of the Corporation as a director, officer, employee or agent. The provisions of
this Section 4 shall not be deemed to be exclusive or to limit in any way the
circumstances in which a person may be deemed to have met the applicable
standard of conduct set forth in Sections 1 or 2 of this Article VIII, as the
case may be.
Section 5. Indemnification by a Court. Notwithstanding any contrary determination in the specific case under Section 3 of this Article VIII, and notwithstanding the absence of any determination thereunder, any director or officer may apply to any court of competent jurisdiction in the State of Delaware for indemnification to the extent otherwise permissible under Sections 1 and 2 of this Article VIII. The basis of such indemnification by a court shall be a determination by such court that indemnification of the director or officer is proper in the circumstances because he has met the applicable standards of conduct set forth in Sections 1 or 2 of this Article VIII, as the case may be. Neither a contrary determination in the specific case under Section 3 of this Article VIII nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct. Notice of any application for indemnification pursuant to this Section 5 shall be given to the Corporation promptly upon the filing of such application. If successful, in whole or in part, the director or officer seeking indemnification shall also be entitled to be paid the expense of prosecuting such application.
Section 6. Expenses Payable in Advance. Expenses incurred by a director or officer in defending or investigating a threatened or pending action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the Corporation as authorized in this Article VIII.
Section 7. Nonexclusivity of Indemnification and Advancement of Expenses. The indemnification and advancement of expenses provided by or granted pursuant to this Article VIII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any Bylaw, agreement, contract, vote of stockholders or disinterested directors or pursuant to the direction (howsoever embodied) of any court of competent jurisdiction or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office, it being the policy of the Corporation that indemnification of the persons specified in Sections 1 and 2 of this Article VIII shall be made to the fullest extent permitted by law. The provisions of this Article VIII shall not be deemed to preclude the indemnification of any person who is not specified in Sections 1 or 2 of this Article VIII but whom the Corporation has the power or obligation to indemnify under the provisions of the General Corporation Law of the State of Delaware, or otherwise.
Section 8. Insurance. The Corporation may purchase and maintain insurance on behalf of any person who is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against any liability asserted against him and incurred by him in any such capacity, or arising out of his status as such, whether or not the Corporation would have the power or the obligation to indemnify him against such liability under the provisions of this Article VIII.
Section 9. Certain Definitions. For purposes of this Article VIII, references to the Corporation shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors or officers, so that any person who is or was a director or officer of such constituent corporation, or is or was a director or officer of such constituent corporation serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, shall stand in the same position under the provisions of this Article VIII with respect to the resulting or surviving corporation as he would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Article VIII, references to fines shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to serving at the request of the Corporation shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner not opposed to the best interests of the Corporation" as referred to in this Article VIII.
Section 10. Survival of Indemnification and Advancement of Expenses. The indemnification and advancement of expenses provided by, or granted pursuant to, this Article VIII shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person.
Section 11. Limitation on Indemnification. Notwithstanding anything contained in this Article VIII to the contrary, except for proceedings to enforce rights to indemnification (which shall be governed by Section 5 hereof), the Corporation shall not be obligated to indemnify any director or officer in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors of the Corporation.
Section 12. Indemnification of Employees and Agents. The Corporation may, to the extent authorized from time to time by the Board of Directors, provide rights to indemnification and to the advancement of expenses to employees and agents of the Corporation similar to those conferred in this Article VIII to directors and officers of the Corporation.
ARTICLE IX
AMENDMENTS
Section 1. Amendments. These Bylaws may be altered, amended or repealed, in whole or in part, or new Bylaws may be adopted by the stockholders or by the Board of Directors; provided, however, that notice of such alteration, amendment, repeal or adoption of new Bylaws be contained in the notice of such meeting of stockholders or Board of Directors, as the case may be. All such amendments must be approved by either the holders of a majority of the outstanding capital stock entitled to vote thereon or a majority of the entire Board of Directors then in office.
CERTIFICATION
I, Anju Tandon, Secretary of the Corporation, do hereby certify that the foregoing is a full, true and correct copy of the Corporation's Bylaws in full force and effect as of February 19, 2004.
THE SECURITIES OFFERED HEREIN HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED OR SOLD IN THE U.S. OR TO U.S PERSONS UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT OR UNDER AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT. THIS STOCK PURCHASE AGREEMENT IS EXECUTED IN RELIANCE UPON THE EXEMPTION PROVIDED BY SECTION 4(2) OF THE ACT.
TNT DESIGNS, INC.
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is made and entered into between the undersigned and TNT Designs, Inc., a corporation existing under the laws of the State of Delaware (the "Issuer") in connection with the private placement of up to a maximum of 500,000 shares of common stock, par value $.0001, of the Issuer (the "Common Stock").
The undersigned (the "Subscriber"):
NAME:____________________________________________
ADDRESS:_________________________________________
Hereby represents and warrants to and agrees to the following:
Article 1 Subscription
1.1 Subscription. The Subscriber as principal hereby subscribes to purchase _____________ shares of Common Stock at the price of $.10 per share at an aggregate purchase price of $________ (the "Subscription Price").
1.2 Method of Payment. The Subscriber shall pay the Subscription Price by (i) check, money order or bank draft made payable to "TNT Designs, Inc. Trust Account" or (ii) by wire transfer of the Subscription Price to the account described in subsection (i) in accordance with the wire instructions in Exhibit A hereto.
Article 2 Representations by the Subscriber
2.1 Representations by Subscriber. Subscriber makes the following representations and warranties:
(a) Subscriber has received a copy of the private placement memorandum in connection with the sale of Common Stock hereunder and has had the opportunity to ask questions and receive any additional information from persons acting on behalf of the Issuer to verify my understanding of the terms thereof and of the Company's business and status thereof, and that no oral information furnished to the undersigned or my advisors in connection with my participation in the Shares has been in any way inconsistent with other documentary information provided.
(b) The Shares are being purchased for Subscriber's own account for long-term investment and not with a view to immediately resell the Shares. No other person or entity will have any direct or indirect beneficial interest in, or right to, the Shares. Subscriber has such knowledge and experience in financial and business matters that will enable him or her to utilize the information made available in connection with the purchase of the Shares to evaluate the merits and risks of participation and to make an informed investment decision.
(d) Subscriber acknowledges that the Shares have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or qualified under the any applicable blue sky laws, in reliance, in part, on the representations, warranties and agreements made herein.
(e) Subscriber represents, warrants and agrees that the Company and the officers of the Issuer are under no obligation to register or qualify the participation in the Shares under the Securities Act of 1933, as amended or under any state securities law, or to assist the Subscriber in complying with any exemption from registration and qualification.
(f) Subscriber represents that he or she meets the criteria for participation because (i) he or she has a preexisting personal or business relationship with the Issuer or one or more of its partners, officers, directors or controlling persons or (ii) by reason of business or financial experience, or by reason of the business or financial experience of Subscriber's financial advisors who are unaffiliated with, and are not compensated, directly or indirectly, by the Issuer or any affiliate or selling agent of the Issuer, Subscriber is capable of evaluating the risk and merits of an investment in the Shares and of protecting his or her own interests; AND (i) Subscriber has a minimum net worth in excess of $1,000,000, or (ii) Subscriber has income in excess of $200,000 or joint income with his or her spouse in excess of $300,000 in each of the two most recent years, and has a reasonable expectation of reaching the same income level in the current year; or (iii) Subscriber is a director or executive officer of the Issuer; or (iv) if a trust, the trust has total assets in excess of $5,000,000 and was not formed for the specific purpose of acquiring the Shares and the purchase was directed by a sophisticated person as described in the applicable regulations; or (v) if a corporation or partnership, the corporation or partnership has total assets in excess of $5,000,000 and was not formed for the specific purpose of acquiring the Shares; or (vi) if an entity, all of the equity owners meet the criteria for participation set forth in this paragraph.
(g) Subscriber acknowledges that investment in the Shares is illiquid, cannot be readily sold as there will not be a public market for the Shares, and Subscriber may not be able to sell or dispose of the Shares, or to utilize the Shares as collateral for a loan. Investment in the shares is reasonable in relation to Subscriber's net worth. (h) Subscriber acknowledges that the right to transfer the Shares will be restricted unless the transfer is not in violation of the securities laws (including investment suitability standards), that the Issuer will not consent to a transfer of participation in the Shares unless the transferee represents that such transferee meets the financial suitability standards required of an initial participant and that the Issuer has the right, in its absolute discretion, to refuse to consent to such transfer.
(j) Subscriber acknowledges that the tax consequences of investing in the Issuer will depend on his or her particular circumstances, and neither the Issuer, the Issuer's officers, any other investors, nor the partners, shareholders, members, managers, agents, officers, directors, employees, affiliates or consultants of any of them, will be responsible or liable for the tax consequences of an investment in the Issuer.
(k) All information which Subscriber has provided to the Issuer concerning him or her, including financial position and knowledge of financial and business matters is truthful, accurate, correct and complete as of the date set forth herein.
2.2 Agreement to Indemnify Issuer. Subscriber hereby agrees to indemnify and hold harmless the Issuer, its principals, officers, directors and attorneys, from any and all damages, costs and expenses (including actual attorneys' fees) which they may incur (i) by reason of Subscriber's failure to fulfill any of the terms and conditions of this Agreement, (ii) by reason of Subscriber's breach of any of the representations, warranties or agreements contained herein; (iii) with respect to any and all claims made by or involving any person, other than Subscriber, claiming any interest, right, title, power or authority in respect to the Shares. Subscriber further agrees and acknowledges that these indemnifications shall survive any sale or transfer, or attempted sale or transfer, of any portion of the Shares.
2.3 Execution Authorized. If this subscription is executed on behalf of a corporation, partnership, trust or other entity, the undersigned has been duly authorized and empowered to legally represent such entity and to execute this subscription and all other instruments in connection with participation in the Shares and the signature of the person is binding upon such entity.
Article 3 Issuance of Certificates
The Issuer shall prepare and issue one or more certificates for the Shares registered in such name or names as specified by the Subscriber. Such certificates shall bear a legend in substantially the following form:
THE SECURITIES REGISTERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR UNDER ANY STATE SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE ISSUER THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY TO (A) THE ISSUER, (B) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE ACT OR (C) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT.
Article 4 General Provisions
4.1 This Agreement shall be construed and governed under the laws of the State of New York without regard to its choice of law provisions.
4.2 This Agreement shall inure to the benefit of and is binding upon the respective successors and assigns of the parties hereto.
4.3 This Agreement may be executed in counterparts and by facsimile, each of which when executed by any party will be deemed to be an original and all of such counterparts will together constitute one and the same Agreement.
Signature Page for Subscriber
Agreed to on __________________.
Date
TNT Designs, Inc.
Subscriber Information:
Name:________________________________________________________________
Address:______________________________________________________________
Phone: (________)________________________
Fax: (________)________________________
Exhibit A
Wire Instructions
[To Be Provided]
EXCLUSIVE DISTRIBUTORSHIP AND ALLIANCE AGREEMENT
This Agreement is entered into on September 22, 2004 between the following parties:
RADICO
A corporation formed under the laws of India with registered offices at HSIDC
Industrial Estate, Sector- 31, Faridabad -121002, India (herein after referred
to as "RADICO" or "the Manufacturer")
and
TNT Designs
A corporation formed under the laws of the State of Delaware, U.S.A. with
offices at 305 Madison Avenue, Suite 449, New York, New York, U.S.A. 10165
(hereinafter referred to as "TNT Designs" or "the Distributor").
WITNESSETH:
WHEREAS, RADICO is a premier manufacturer of women's clothing and fashion accessories in India;
WHEREAS, TNT Designs is a duly incorporated Delaware corporation which is engaged in the wholesale and retail business in the U.S.A. for women's fashion accessories; and
WHEREAS, RADICO and TNT wish to enter into this Agreement for the purpose of establishing a strategic alliance for provision of certain exclusive distribution rights of RADICO products by TNT under the terms and conditions herein.
NOW, THEREFORE, in consideration of the foregoing and of the mutual premises hereinafter expressed, the parties hereto mutually agree as follows: SUBJECT OF THE AGREEMENT
1. The Manufacturer appoints TNT Designs as mentioned above as their exclusive distributor for Radico "Fashion accessories" in New York State. The Manufacturer will produce and sell to the Distributor "Fashion accessories" (hereinafter referred to as "the Goods", Description, prices and other details attached as Annexure-I) following the receipt of a written order from the Distributor. The Distributor will take possession of the Goods and pay the agreed upon sale price.
2. The Manufacturer will produce and pack the Goods, according to the specifications, described in this Contract, and will present all necessary documents (certificates, transport certificates and all other, related to the Goods).
EXCLUSIVITY
3. This Agreement shall be exclusive in the Territory of New York, hereinafter referred to as the "Territory", where for a period of 5 years from the effective date. TNT Designs shall be the only company authorized to import exclusive products as mentioned above and sell the Products in the Territory.
4. Radico shall not sell the products directly and/or indirectly to any other wholesaler or business entity in the Territory for the period of exclusivity to protect TNT Designs prior investment for sales promotion.
5. In consideration of the exclusivity, TNT Designs undertakes to buy the minimum quantity periodically, quantity to be decided upon mutual agreement.
ORDERS, PRICES AND PAYMENTS
6. The Distributor will send to the Manufacturer a written purchase
order, which must indicate the exact quantity of the Goods, the
modes of payment and the delivery date for the Goods. The
Manufacturer must confirm the acceptance of the order within 5
(five) days of its receipt. In the case that the Manufacturer does
not agree to any of the conditions, indicated in the order, the
Manufacturer will notify the Distributor immediately. Any written
purchase order confirmed by the Manufacturer will be considered as
an indivisible part of this Contract.
7. In case of change in prices, the two parties under this Agreement will renegotiate the price, for which an additional agreement will be signed, and which will be included as an indivisible part of this Contract.
8. All payments will be made in US dollars, via bank transfer or by irrevocable L/C at sight (to the indicated below bank account), in the following manner:
o 50% of the total value of each order in advance, after the order has been confirmed by the Manufacturer and 50% upon receipt of dispatch document for the Goods ordered by the Distributor in accordance with applicable law.
Bank Account of the Manufacturer:
Name of Bank: Citibank
Address of Bank: Jeevan Bharti building, Connaught Place,
New Delhi-110001, India
Account name: Radico
Account type: Current
Account Number: 0417504001
Bank's swift code: CITI IN BX IBD
QUALITY OF THE GOODS, QUALITY ASSURANCE
9. The Manufacturer undertakes the obligation to produce and deliver the goods in the highest quality possible, which is in accordance to the conditions, specified in this Contract. The Manufacturer will guarantee to the Distributor that the Goods will be in accordance with the specifications of the order.
10. In the case that qualitative or quantitative discrepancy arise, the distributor shall notify the manufacturer in writing immediately after discrepancies are discovered. In case of quantitative discrepancies the mfr must be notified with 7 days of receipt of goods and in case of qualitative discrepancies mfr must be notified within 30 days of receipt of goods by distributor. Claims received after above mentioned specified duration shall not be entertained by mfr.
LABELING AND PACKAGING
11. The Goods must be packed and labelled following the requirements of the Distributor.
TERMS OF DELIVERY AND DOCUMENTS, ACCOMPANYING THE GOODS
12. The Manufacturer will prepare the Goods in accordance to the requirements, specified in this Agreement and the additional instructions of the Distributor.
13. The Manufacturer undertakes the obligation to deliver the Goods as
soon as reasonably practicable which is expected to be no later than
35 (thirty-five) days, after initial payment of the amount for each
order is made.
14. When delivering the Goods, the Manufacturer must provide the necessary dispatch documents as required by Distributor, and the Distributor will be responsible for all shipping costs for Goods shipped by air freight.
ARBITRATION
15. In case of any dispute, both parties agree to try and settle all disputes, related in any way to this Contract, in a friendly manner through arbitration.
FORCE MAJEURE
16. The parties shall bear no responsibility for non-performance due to any event (force- majeure) beyond their control, namely: acts of God, military actions of any nature, blockades, export or import prohibition. In such cases the terms set for performing the contractual obligations shall be extended in proportion with the duration of the force majeure circumstances. The party in default for force majeure circumstances should immediately notify in written the other party about their occurrence or ending. The party having failed to do so shall not be entitled to refer to force majeure in the future. The occurrence of force majeure should be expressly proved by certificate issued by the relevant Chamber of Commerce and Industry. If the stated events last for more than four months, each of the parties may cancel the affected orders and in such case neither party shall have the right to indemnity for the suffered damages.
DURATION OF THE CONTRACT
17. This Contract will become effective on the date of its signing by both parties and shall remain valid for 5 years automatically renewable for equal periods on each anniversary unless 6 months written cancellation notice is given by either party. All changes and additions to this Contract will be valid only in writing. The written form of validation will include also telegrams, fax or telex. With the signing of this Contract, all other verbal arrangements between the two parties until this moment are rendered invalid.
18. This Contract can be terminated unilaterally by either party any time with a preliminary termination notice of three months, delivered in writing to the other party with valid reasons.
19. All obligations to both parties, ensuing from this Contract, before its termination, will be binding to both parties until their full completion.
GENERAL PROVISIONS.
20. Entire Agreement: This Agreement together with all documents incorporated by reference herein, constitutes the entire and sole agreement between the parties with respect to the subject matter hereof and supersedes any prior agreements with respect to the subject matter hereof. This Agreement cannot be modified, changed or amended, except for in writing signed by a duly authorized representative of each of the parties.
21. Conflict: In the event of any conflict, ambiguity or inconsistency between this Agreement and any other document which may be annexed hereto, the terms of this Agreement shall govern.
22. Assignment and Delegation: Neither party shall assign or delegate this Agreement or any rights, duties or obligations hereunder to any other person and/or entity without prior express written approval of the other party.
23. Notices: Any notice required or permitted to be given under this Agreement shall be in writing, by commercial overnight courier or registered or certified Mail, to the addresses above.
24. Governing Law: This Agreement shall be governed by and construed in accordance with the laws of Switzerland in accordance with commercially reasonable standards of international trade agreements.
25. Counterparts: This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
26. Scope. This Agreement shall not apply to preexisting buyers of Radico products in the Territory who have been purchasing goods from Radico prior to the date of this Agreement, and Radico may continue to supply such buyers directly.
[intentionally left blank]
IN WITNESS WHEREOF, the parties, by their duly authorized representatives, have caused this Agreement to be executed as of the date first written above.
RADICO TNT DESIGNS By: By: ----------------------- -------------------------------- Sanjeev Bhatt Anju Tandon CEO CEO |
Exhibit 23.1
Consent of Most & Company, LLP, Independent Registered Public Accounting Firm
The Board of Directors
TNT Designs, Inc:
We hereby consent to the use in this Registration Statement on Form SB-2 of our report dated October 14, 2004, relating to the balance sheet of TNT Designs, Inc. as of September 30, 2004, and the related consolidated statements of operations, stockholders' equity, and cash flows for the period February 17, 2004 (inception) to September 30, 2004, which report appears in such Registration Statement. We also consent to the reference to our firm under the heading "Interest of Named Experts and Counsel" in such Registration Statement.
/s/ Most & Company, LLP Most & Company, LLP, Independent Registered Public Accounting Firm New York, NY December 23, 2004 |