Fenton Graham Marketing Inc – ‘SB-2/A’ on 7/23/02

On:  Tuesday, 7/23/02, at 7:36pm ET   ·   As of:  7/24/02   ·   Accession #:  1084178-2-124   ·   File #:  333-88090

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Pre-Effective Amendment to Registration of Securities by a Small-Business Issuer   —   Form SB-2
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SB-2/A      Pre-Effective Amendment to Registration of            56±   211K 
                          Securities by a Small-Business Issuer                  
 2: EX-5        Opinion re: Legality                                   2±     8K 
 3: EX-10       Material Contract                                      2±    10K 
 4: EX-23       Consent of Experts or Counsel                          1      5K 

SB-2/A   —   Pre-Effective Amendment to Registration of Securities by a Small-Business Issuer
Document Table of Contents

       As filed with the Securities and Exchange Commission on July 24, 2002
                                              SEC Registration No. 333-88090

UNITED STATES               
SECURITIES AND EXCHANGE COMMISSION                
WASHINGTON, D.C. 20549                

PRE-EFFECTIVE AMENDMENT NO. 1               
TO                
FORM SB-2               
REGISTRATION STATEMENT                
UNDER               
THE SECURITIES ACT OF 1933                

Fenton Graham Marketing, Inc.               
----------------------------------------------                
(Name of small business issuer in its charter)                

Nevada                   7380              86-1042805               
---------------       -----------------      --------------                 
(State or other       (Primary Standard          (I.R.S.                    
jurisdiction             Industrial            Employer                   
of             Classification Code     Identification           
incorporation)             Number)               Number)                    

13215 Verde River Drive, Unit 1               
Fountain Hills, AZ 85268                
(480) 836-8720                
-------------------------------------------------------------               
(Address and telephone number of principal executive offices)               

J.P. Schrage, President               
Fenton Graham Marketing, Inc.               
13215 Verde River Drive, Unit 1               
Fountain Hills, AZ 85268                
(480) 836-8720                
---------------------------------------------------------               
(Name, address and telephone number of agent for service)               

With copy to:               

Chapman & Flanagan, Ltd.                
777 N. Rainbow Blvd., Suite 390               
Las Vegas, NV 89107               

Approximate date of proposed sale to the public: As soon as                     
reasonably practicable after the effective date of this                         
Registration Statement.                                                         

If this Form is filed to register additional securities for an                  
offering pursuant to Rule 462(b) under the Securities Act, 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, 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(d) under the Securities Act, check the following box and list               
the Securities Act registration statement number or the earlier                 
effective registration statement for the same offering. __                      

If delivery of the prospectus is expected to be made pursuant to                
Rule 434, check the following box. __                                           

(i)         

Title                                                                         
of each                      Proposed     Proposed                            
class of                     maximum      maximum                             
securities     Amount to     offering     aggregate     Amount of             
to be          be            price per    offering      registration          
registered     registered    share        price         fee (1)               
----------     ----------    ---------    ---------     ------------          

Common         5,000,000     $0.02        $100,000      $9.20                 
Shares,                                                                       
$0.001 par                                                                    
value,                                                                        
to be sold by                                                                 
the Company                                                                   

Common         1,000,000     $0.02        $20,000       $1.84                 
Shares,                                                                       
$0.001 par                                                                    
value,                                                                        
to be sold by                                                                 
selling                                                                       
security                                                                      
holders                                                                       

Total          6,000,000                  $120,000      $11.04                

(1)  Previously paid.                                                       

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 which                       
specifically states that this registration statement shall                      
thereafter become effective in accordance with Section 8(a) of                  
the Securities Act of 1933 or until the registration statement                  
shall become effective on such date as the Commission, acting                   
pursuant to said Section 8(a), may determine.                                   

Explanatory Note                
----------------                

This registration statement contains two prospectuses: one                      
relating to the offering by Fenton Graham of 5,000,000 shares of                
its common stock, par value $0.001 per share, for cash and                      
another prospectus relating to the offering of 1,000,000 shares                 
of common stock held by selling security holders who may wish to                
sell their common stock. The prospectus relating to the selling                 
security holders is referred to as the selling security holders                 
prospectus. Following the prospectus are substitute pages of the                
selling security holders prospectus, including alternate pages                  
front outside and back cover pages, an alternative "The Offering"               
section of the "Prospectus Summary" and sections entitled "Use of               
Proceeds", "Determination of Offering Price", "Selling Security                 
Holders", and "Plan of Distribution".  Each of the alternate                    
pages for the selling security holder prospectus is labeled                     
"Alternate Page for Selling Security Holder Prospectus." All                    
other sections of the prospectus are to be used in the selling                  
security holder prospectus. In addition, cross-references in the                
prospectus will be adjusted in the selling security holder                      
prospectus to refer to the appropriate sections.                                

(ii)                

Initial Public Offering Prospectus                                              

Fenton Graham Marketing, Inc.               

5,000,000 Shares of Common Stock                

We are offering a maximum of 5,000,000 shares of our common stock               
for sale at $0.02 per share on a best-efforts basis and without                 
the assistance of an underwriter.  There is no minimum amount of                
shares we must sell and no money raised from the sale of our                    
stock will go into escrow, trust or any other similar                           
arrangement.                                                                    

Unless we decide to cease selling efforts at a prior date, we                   
will close the offering on the earlier of (1) the date all of the               
5,000,000 shares are sold, or (2) the sixth month anniversary of                
the date of this prospectus.                                                    

There is no public market for our common stock.                                 

Concurrent with this offering, we are registering 1,000,000                     
additional shares of common stock for sale by 18 of our                         
shareholders. These selling shareholders will offer their stock                 
at a price of $0.02 per share until our shares are quoted on the                
OTC Bulletin Board and thereafter at prevailing market prices, or               
at privately negotiated prices.                                                 

THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD                      
PURCHASE THESE SECURITIES ONLY IF YOU CAN AFFORD A COMPLETE LOSS.               
SEE "RISK FACTORS" BEGINNING ON PAGE 5 TO READ ABOUT FACTORS YOU                
SHOULD CONSIDER BEFORE BUYING ANY OF THESE SECURITIES.                          

            Offering Price      Underwriting         Proceeds to
             to the public        discounts          the Company
            --------------      ------------         -----------

Per share            $0.02              $ 0                 $0.02       
Total maximum      $100,000             $ 0               $100,000      

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 ____________, 2002               

1         

TABLE OF CONTENTS               

                                                                      Page

Prospectus Summary.........................................................4    

Risk Factors...............................................................5    

We are a development stage company with no operating history............5 

Because we will need to raise additional funds and these funds            
may not be available to us, we may need to change our business plan.....6 

Our sole officer and director is engaged in other activities............6 

If our ad delivery and tracking technology proves to be Ineffective,      
we may be unable to attract and retain advertising clients..............6 

Sales of our shares held by the Selling Shareholders in a                 
concurrent offering may make it difficult for us to sell shares           
in the offering.........................................................7 

There is no minimum purchase requirement................................7 

There is no current public market for our common stock..................8 

Our shares may be considered a "penny stock"............................8 

Forward-Looking Statements.................................................8    

Use of Proceeds............................................................9    

Determination of Offering Price...........................................10    

Dilution..................................................................10    

Plan of Distribution......................................................11    

Legal Proceedings.........................................................12    

Directors, Executive Officers, Promoters and Control Persons..............12    

Security Ownership of Certain Beneficial Owners and Management............13    

Description of Securities.................................................13    

Interest of Named Experts and Counsel.....................................14    

Disclosure of Commission Position on Indemnification for                        
Securities Act Liabilities................................................14    

2       

Organization Within the Last Five Years...................................15    

Description of Business...................................................15    

Management's Plan of Operation............................................23    

Description of Property...................................................26    

Certain Relationships and Related Transactions............................26    

Market for Common Equity and Related Stockholder Matters..................27    

Executive Compensation....................................................28    

Financial Statements......................................................29    

Where You Can Find More Information.......................................39    

Experts...................................................................39    

Legal Matters.............................................................39    

3               

PROSPECTUS SUMMARY                

The Company                                                                     
-----------                                                                     

Fenton Graham was incorporated in the State of Nevada on October                
17, 2001 for the purpose of offering marketing solutions to                     
Internet businesses which will help them build brands, acquire                  
customers, drive traffic, increase sales and garner customer                    
relations.                                                                      

Since our inception, our activities have been limited to                        
organizational matters and the development of our proprietary                   
software.  As of March 31, 2002 we have realized $2,864 net                     
losses and have not yet established profitable operations.  We do               
not expect to earn revenues until March 2003 or later.                          

Our principal executive offices are located 13215 Verde River                   
Drive, Unit 1, Fountain Hills, Arizona 85268.  Our telephone                    
number is (480) 836-8720.                                                       

The Offering                                                                    
------------                                                                    

Securities offered by the Company............ 5,000,000 shares of our           
                        common stock

Offering price per share..................... $0.02                             

Common stock presently outstanding........... 6,000,000                         

Common stock to be outstanding after                                            
completion of the offering................... 11,000,000                        

Termination date............................. Upon the earlier of the sixth     
                                         month anniversary of the date
                                          of this prospectus or the sale
                                       of all the shares of common
                                        stock that are being offered

How to subscribe............................. Each prospective investor who     
                                         desires to purchase shares of
                                         common stock should complete,
                                 date, and execute the
                                          Subscription Agreement, make a
                                       check, bank draft, or money
                                    order payable to "Fenton
                                          Graham Marketing, Inc." in the
                                     amount of $0.02 times the
                                       number of shares subscribed
                                          for, and deliver the completed
                                      Subscription Agreement and
                                       check to the Company at the
                                          following address: 13215 Verde
                                         River Drive, Unit 1, Fountain
                                 Hills, Arizona 85268.

4         

Estimated net proceeds to us................. $95,000 after estimated           
                                    offering costs of $5,000

Use of proceeds.............................. Working capital and general       
                               corporate purposes.

Risk factors................................. The securities offered hereby     
                                         involve a high degree of risk
                                     and immediate substantial
                                    dilution from the public
                           offering price.

Selling shareholders offering................ The selling security holders      
                                          offering will run concurrently
                                         with the primary offering. We
                                          are simultaneously registering
                                          1,000,000 additional shares of
                                          our common stock to be sold by
                                          18 of our shareholders.  These
                                         selling security holders will
                                        offer their stock at a price
                                        of $0.02 per share until our
                                        shares are quoted on the OTC
                                         Bulletin Board and thereafter
                                        at prevailing market prices,
                                      or at privately negotiated
                   prices.

In this prospectus, reference to "we," "our" and "us" refers to               
Fenton Graham Marketing, Inc.               

RISK FACTORS                

An investment in the securities that are being offered involves a               
high degree of risk and should only be made by those who can                    
afford to lose up to their entire investment. Before purchasing                 
these securities, you should consider carefully the following                   
risk factors, in addition to the other information in this                      
prospectus.                                                                     

Risks related to our financial condition                                        
----------------------------------------                                        

WE ARE A DEVELOPMENT STAGE COMPANY ORGANIZED IN OCTOBER 2001 AND                
HAVE NO OPERATING HISTORY, WHICH MAKES AN EVALUATION OF US                      
EXTREMELY DIFFICULT.  AT THIS STAGE OF OUR BUSINESS OPERATIONS,                 
EVEN WITH OUR GOOD FAITH EFFORTS, YOU HAVE A HIGH PROBABILITY OF                
LOSING YOUR INVESTMENT.                                                         

We were incorporated in October of 2001 as a Nevada corporation.                
As a result of our recent start up, Fenton Graham has yet to                    
generate revenues from operations and anticipates losses for the                
foreseeable future. Since incorporation, our business activities                
have been limited to raising funds, developing our software and                 
business plan. Because our technology is not fully developed and                
we have no customers, there is nothing at this time on which to                 
base an assumption that our business operations will prove to be                
successful or that we will ever be able to operate profitably.                  
Our future operating results will depend on many factors,                       
including our ability to raise adequate working capital, demand                 
for our products and services, the level of our competition and our             

5             

ability to attract and maintain key management and employees.                   
You should not invest in this offering unless you can afford to                 
lose your entire investment.                                                    

BECAUSE WE WILL NEED TO RAISE ADDITIONAL FUNDS AND THESE FUNDS                  
MAY NOT BE AVAILABLE TO US WHEN WE NEED THEM, WE MAY NEED TO                    
CHANGE OUR BUSINESS PLAN OR WE WILL FACE BANKRUPTCY AND CEASE                   
OPERATIONS AND YOU WILL LOSE YOUR ENTIRE INVESTMENT.                            

Based on our current projections, we will need to raise funds                   
after the expiration of one year from the closing of this                       
offering through the issuance of equity, equity-related or debt                 
securities in addition to the funds we are raising in this                      
offering. We will need to raise additional capital sooner than                  
one year after the closing of this offering if we are unable to                 
sell the maximum number of shares of common stock being offered                 
or if we receive the maximum proceeds and our sales are lower                   
than expected. Additional capital may not be available to us on                 
favorable terms when required, or at all. If this additional                    
financing is not available to us, we may need to dramatically                   
change our business plan, sell or merge our business or face                    
bankruptcy and cease operations. In addition, our issuance of                   
equity or equity-related securities will dilute the ownership                   
interest of existing shareholders and our issuance of debt                      
securities could increase the risk or perceived risk of our                     
company. Any of these actions could cause our stock price to                    
fall. Apart from our requirements for capital in addition to the                
anticipated proceeds of this offering, prospective investors                    
should be aware of the possibility that we will not raise any                   
funds in this offering and we will not be able to commence                      
operations.                                                                     

Risks related to our business                                                   
-----------------------------                                                   

OUR SOLE OFFICER AND DIRECTOR IS ENGAGED IN OTHER ACTIVITIES AND                
IS LIMITED IN THE TIME HE CAN DEVOTE TO OUR OPERATIONS.  THE LOSS               
OR UNAVAILABILITY TO FENTON GRAHAM OF MR. SCHRAGE'S SERVICES                    
WOULD HAVE AN ADVERSE EFFECT ON OUR BUSINESS, OPERATIONS AND                    
PROSPECTS AND YOUR INVESTMENT COULD BE LOST.                                    

J.P. Schrage, our sole officer and director, has existing                       
responsibilities to provide management and services to other                    
entities. As a result, Mr. Schrage may have troubles in                         
allocating time, services, and functions between the other                      
business ventures in which he is involved and our affairs.  Mr.                 
Schrage presently spends approximately 20 hours per week on                     
business management services for our company.  These factors will               
most likely cause delays to conducting operations and raising                   
capital. We face the additional risk that Mr. Schrage could leave               
with little or no prior notice because he is not bound by an                    
employment agreement.  We do not have "key person" life insurance               
policies covering Mr. Schrage.  In the event we should lose the                 
services of Mr. Schrage prior to hiring additional management, we               
would be required to cease pursuing our business plan, which                    
would result in the loss of your entire investment.                             

IF OUR AD DELIVERY AND TRACKING TECHNOLOGY PROVES TO BE                         
INEFFECTIVE, WE WILL BE UNABLE TO ATTRACT AND MAINTAIN ADVERTISING              

6                 

CLIENTS.  IF WE ARE UNABLE TO GENERATE REVENUE FROM                             
ADVERTISING CLIENTS YOUR INVESTMENT MAY BE LOST.                                

If the online advertising market does not develop further, or                   
develops more slowly than expected, we may not generate enough                  
advertising revenue to turn a profit. Since we expect to derive                 
substantially all of our revenue from online advertising, our                   
future success is highly dependent on the increased use of the                  
Internet as an advertising medium.  Because our WarRoom and                     
Redirector technology is new and unproven, we cannot assure you                 
that the use of our WarRoom and Redirector services will be                     
effective in serving, targeting and tracking advertisements or                  
other marketing and promotional activities. Our revenue would be                
adversely affected if marketers do not perceive that the use of                 
our WarRoom and Redirector services will improve the                            
effectiveness of their marketing campaigns.                                     

Risks related to this offering                                                  
------------------------------                                                  

SALES OF OUR SHARES BY THE SELLING SECURITY HOLDERS IN A                        
CONCURRENT OFFERING MAY MAKE IT DIFFICULT FOR US TO SELL SHARES                 
IN THE OFFERING.  IF WE ARE UNABLE TO RAISE MONEY FROM THIS                     
OFFERING WE MAY NOT BE ABLE TO CONTINUE OUR BUSINESS AND YOU WILL               
LOSE YOUR INVESTMENT.                                                           

Upon completion of this offering we will have outstanding                       
11,000,000 shares of common stock if all the shares offered are                 
sold. Of these shares, the shares of common stock sold in this                  
offering and the concurrent selling security holders' offerings                 
will be freely tradable in the public market without restrictions               
or further registrations under the 1933 Act. Thus, concurrent                   
with the offer and sale of shares of our common stock described                 
in this Prospectus, our selling security holders may offer                      
1,000,000 shares of our common stock for sale in a non-                         
underwritten offering by this Prospectus. Sale of a substantial                 
number of shares of our common stock in the public market by our                
selling security holders concurrently with this offering could                  
depress the market price of our common stock and could impair our               
ability to raise capital by preventing us from selling all of the               
shares in the offering.                                                         

THERE IS NO MINIMUM PURCHASE REQUIREMENT. THEREFORE WE MAY                      
RECEIVE LITTLE OR NO FUNDING FROM THIS OFFERING. IF ONLY A                      
MINIMAL AMOUNT OF SHARES ARE SOLD, YOU WILL HOLD SHARES IN A                    
COMPANY THAT IS SUBSTANTIALLY UNDERCAPITALIZED AND CONTROLLED BY                
INSIDERS.                                                                       

Purchasers should realize that all sales will be final and no                   
proceeds will be returned to any purchasers regardless of how few               
shares are sold and proceeds raised. Should we raise only a                     
minimal amount through this initial public offering, and since we               
will not receive any of the proceeds from the sales by the                      
selling security holders, we will rely upon our officers and                    
directors, who are our major shareholders, to cover operating                   
costs and provide the professional expertise to keep us                         
operational until such time as we can raise the funds necessary                 
to proceed with our planned operations.                                         

7         

THERE IS NO CURRENT PUBLIC MARKET FOR OUR COMMON STOCK; THEREFORE               
YOU MAY BE UNABLE TO SELL YOUR SHARES AT ANY TIME, FOR ANY                      
REASON, AND AT ANY PRICE, RESULTING IN A LOSS OF YOUR INVESTMENT.               

As of the date of this prospectus, there is no public market for                
our common stock. Although we plan to contact an authorized OTC                 
Bulletin Board market maker for sponsorship of our securities on                
the Over-the-Counter Bulletin Board, there can be no assurance                  
that our attempts to do so will be successful. Furthermore, if                  
our securities are not quoted on the OTC Bulletin Board or                      
elsewhere, there can be no assurance that a market will develop                 
for the common stock or that a market in the common stock will be               
maintained. As a result of the foregoing, investors may be unable               
to sell their shares for any reason.                                            

OUR SHARES MAY BE CONSIDERED A "PENNY STOCK" WITHIN THE MEANING                 
OF RULE 3A-51-1 OF THE SECURITIES EXCHANGE ACT WHICH WILL AFFECT                
YOUR ABILITY TO SELL YOUR SHARES; "PENNY STOCKS" OFTEN SUFFER                   
WIDE FLUCTUATIONS AND HAVE CERTAIN DISCLOSURE REQUIREMENTS WHICH                
MAKES IT DIFFICULT FOR YOU TO RESELL YOUR SHARES IN THE SECONDARY               
MARKET.                                                                         

Our shares will be subject to the Penny Stock Reform Act which                  
will affect your ability to sell your shares in any secondary                   
market which may develop. If our shares are not listed on a                     
nationally approved exchange or the NASDAQ, do not meet the                     
minimum financing requirements, or have a bid price of at least                 
$5.00 per share, they will likely be defined as a "penny stock."                
Broker-dealer practices in connection with transactions in "penny               
stocks" are regulated by the SEC. Rules associated with                         
transactions in penny stocks include the following:                             

- the delivery of standardized risk disclosure documents;             

- the provision of other information like current bid/offer           
quotations, compensation to be provided broker-dealer and         
salesperson, monthly accounting for penny stocks held in          
the customers account;                                            

- written determination that the penny stock is a suitable            
investment for purchaser;                                         

- written agreement to the transaction from purchaser.                

These disclosure requirements and the wide fluctuations that                    
"penny stocks" often experience in the market may make it                       
difficult for you to sell your shares in any secondary market                   
which may develop.                                                              

FORWARD-LOOKING STATEMENTS                

Some information in this prospectus may contain forward-looking                 
statements.  You can identify these statements by their forward-                
looking terminology such as "may," "will," "expect,"                            
"anticipate," "continue," or other similar words.  Forward-                     
looking statements discuss future expectations, contain                         
projections of results of operations or of financial condition or               
state other                                                                     

8                 

"forward-looking" information.  When considering                                
forward-looking statements in this prospectus, you should keep in               
mind the risk factors and other cautionary statements included in               
this prospectus.  The risk factors noted in the "Risk Factors"                  
section and the other factors noted throughout this prospectus,                 
could cause our actual results to differ materially from those                  
contained in any forward-looking statement.                                     

USE OF PROCEEDS               

If all the shares are sold, the net proceeds to Fenton Graham                   
from the sale of the shares of common stock offered hereby are                  
estimated to be approximately $95,000, after deduction of                       
estimated offering related expenses, consisting of legal and                    
accounting fees, copying, filing fees and postage. Fenton Graham                
intends to use these proceeds for the proposed expenses shown in                
the table that follows. The following table shows Fenton Graham's               
use of proceeds if 25%, 50%, 75% and/or 100% of the shares are                  
sold. We cannot predict whether or not any shares at all will be                
sold in this offering.                                                          

            25%       50%       75%       100%
            -------    -------   -------  --------
Gross proceeds             $25,000    $50,000   $75,000  $100,000               
Offering expenses            5,000      5,000     5,000     5,000               
            -------    -------   -------  --------
            $20,000    $45,000   $70,000   $95,000

Business development         1,000      2,000     2,500     3,000               
Rent and utilities           4,000      8,000    12,000    14,000               
Staff                                   6,000    18,000    30,000               
45,000                                                                          
Legal and accounting         2,000      3,000     4,000     5,000               
Computer hardware            2,000      4,000     6,000     8,000               
Software development         2,000      4,000     6,000     8,000               
Sales and advertising        2,000      4,000     6,000     8,000               
General working capital      1,000      2,000     3,500     4,000               
            -------    -------   -------  --------
            $20,000    $45,000   $70,000   $95,000

We believe that if we sell at least 25% of the offering we can                  
begin to put our business plan into effect although this amount                 
will be insufficient to meet our needs over the next 12 months.                 
We believe we need to raise maximum proceeds to most effectively                
implement our business plan and less than that amount will                      
require us to limit the amount we spend on bringing our product                 
to market, salaries, and the purchase of office equipment.                      

The working capital reserve may be used for general corporate                   
purposes to operate, manage and proceed with our proposed                       
operations, including travel expenses, labor costs, office                      
supplies, office furniture and equipment, network fees,                         
advertising or promotion, equipment maintenance and other                       
administrative costs. Travel expenses include airline tickets and               
hotel accommodations for management to attend meetings with                     
potential business contacts, and other business travel                          

9               

expenses, such as meals.  We presently have no commitments or                   
agreements to hire employees and are not involved in any                        
negotiations.                                                                   

The amounts set forth in the use of proceeds table merely                       
indicate the proposed use of proceeds, and actual expenditures                  
may vary substantially from these estimates depending upon market               
and economic conditions once operations are commenced.  We may,                 
in the future, seek additional funds through loans or other                     
financing arrangements.                                                         

Pending expenditures of the proceeds of this offering, we may                   
make temporary investments in short-term, investment grade,                     
interest-bearing securities, money market accounts, insured                     
certificates of deposit and/or in insured banking accounts.                     

We presently do not pay Mr. Schrage, our sole officer and                       
director, any amount of salary. In the event we are successful in               
completing this offering, we propose to pay any full time                       
employees salaries competitive in the industry subject to our                   
ability to do so.  Mr. Schrage has agreed to act without cash                   
compensation until we have generated revenues from operations.                  

DETERMINATION OF OFFERING PRICE               

The offering price of the Shares has been arbitrarily determined                
by the Company based upon factors like the Company's capital                    
needs and the percentage of ownership to be held by investors as                
a result of this offering.  The offering price does not                         
necessarily bear any relationship to assets, book value,                        
earnings history or other historical factors.                                   

DILUTION                

As of March 31, 2002, Fenton Graham's net tangible book value was               
$94,923, or $0.016 per share of common stock. Net tangible book                 
value is the aggregate amount of Fenton Graham's tangible assets                
less its total liabilities. Net tangible book value per share                   
represents Fenton Graham's total tangible assets less its total                 
liabilities, divided by the number of shares of common stock                    
outstanding. After giving effect to the sale of 5,000,000 shares                
at an offering price of $0.02 per share of common stock,                        
application of the estimated net sale proceeds (after deducting                 
offering expenses of $5,000), Fenton Graham's net tangible book                 
value as of the closing of this offering would increase from                    
$0.016 to $0.017 per share. This represents an immediate increase               
in the net tangible book value of $0.001 per share to current                   
shareholders, and immediate dilution of $0.003 per share to new                 
investors, as illustrated in the following table:                               

Public offering price per  share of common stock............  $0.02     
Net tangible book value per share before offering...........  $0.015    
Increase per share attributable to new investors............  $0.001    
Net tangible book value per share after offering............  $0.017    
Dilution per share to new investors.........................  $0.003    
Percentage dilution.........................................  15%       

10                

PLAN OF DISTRIBUTION                

The shares in this offering will be sold by the efforts of our                  
sole officer and director, J.P. Schrage. He will not receive any                
commission from the sale of any shares. He will not register as a               
broker-dealer pursuant to Section 15 of the Securities and                      
Exchange Act of 1934 in reliance upon Rule 3a4-1, which sets                    
forth those conditions under which a person associated with an                  
issuer may participate in the offering of the issuer's securities               
and not be deemed to be a broker-dealer. These conditions                       
included the following:                                                         

1.  No selling person is subject to a statutory                                 
disqualification, as that term is defined in Section 3(a)(39) of        
the Exchange Act, at the time of participation,                         

2.  No selling person is compensated in connection with his                     
participation by the payment of commissions or other remuneration       
based either directly or indirectly on transactions in                  
securities,                                                             

3.  No selling person is, at the time of participation, an                      
associated person of a broker-dealer, and                               

4.  Each selling person meets the conditions of paragraph (a)                   
(4) (ii) of Rule 3a4-1 of the Exchange Act, in that the person          
(A) primarily performs or is intending primarily to perform at          
the end of the offering, substantial duties for or on behalf of         
the issuer otherwise than in connection with transactions in            
securities, and (B) is not a broker or dealer, or an associated         
person of a broker or dealer, within the preceding twelve months,       
and (C) does not participate in selling and offering of                 
securities for any issuer more than once every twelve months            
other than in reliance on this rule.                                    

This offering will commence on the date of this prospectus. The                 
offering will terminate on the earlier of the sixth month                       
anniversary of the date of this prospectus or the sale of all the               
shares of common stock that are being offered.  In addition, we                 
may terminate this offering at any time, for any reason; thus not               
selling any or all of the shares offered. The offering may be                   
terminated, for example, because the market price of the common                 
stock is less than the offering price which would impede our                    
ability to sell the offered shares. There is no minimum number of               
shares that we are required to sell.                                            

Procedure of Subscription                                                       
-------------------------                                                       

If you decide to subscribe for shares in this offering, you will                
be required to execute a subscription agreement and tender it,                  
together with a check or wired funds to us, for acceptance or                   
rejection. All checks should be made payable to Fenton Graham                   
Marketing, Inc.  A copy of the subscription agreement will                      
accompany a prospectus or may be obtained from us by persons who                
have received a prospectus and requested the subscription                       
agreement.  Subscription documents and payment should be mailed                 
or delivered to Fenton Graham Marketing, Inc., 13215 Verde River                
Drive, Unit 1, Fountain Hills, Arizona 85268.                                   

11                    

We have the right to accept or reject subscriptions in whole or                 
in part, for any reason or for no reason. All monies from                       
rejected subscriptions will be returned immediately by us to the                
subscriber, without interest or deductions.                                     

Subscriptions for securities will be accepted or rejected                       
promptly. Once accepted, the funds will be deposited in an                      
account maintained by the Company and considered property of the                
Company once cleared by our bank. Subscription funds will not be                
deposited in an escrow account. Certificates for the shares                     
purchased will be issued and distributed by our transfer agent,                 
within ten business days after a subscription is accepted and                   
"good funds" are received in our account. Certificates will be                  
sent to the address supplied in the investor subscription                       
agreement by regular mail.                                                      

Transfer Agent and Registrar                                                    
----------------------------                                                    

The transfer agent and registrar for our common stock will be                   
Executive Registrar and Transfer Agency, Inc., 3118 W. Thomas                   
Road, Suite 707, Phoenix, Arizona 85017.                                        

LEGAL PROCEEDINGS               

Neither Fenton Graham, nor any of its affiliates, officers or                   
directors is a party to any pending legal proceeding, and none of               
our property is the subject of any pending legal proceeding.                    

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS                

The members of the Board of Directors of the Company serve until                
the next annual meeting of the stockholders, or until their                     
successors have been elected. The officers serve at the pleasure                
of the Board of Directors.                                                      

There are no agreements for any officer or director to resign at                
the request of any other person, and the officer and director                   
named below is not acting on behalf of, or at the direction of,                 
any other person.                                                               

Name and Address      Age    Position                             
----------------      ---    --------                             

 J.P. Schrage          25     President/Secretary/Treasurer/Director

Currently Mr. Schrage contributes 20 hours per week to the                      
Company's activities and is not engaged on a full-time basis.                   

J.P. Schrage                                                                    
------------                                                                    

Mr. Schrage has been Secretary/Treasurer and a director of Fenton               
Graham since its inception.  On July 5, 2002, he was appointed                  
President when our former President resigned.  Since May 2002 to                
present, Mr. Schrage has served on a part-time basis as Director                
of Administration for VVVRRR, Inc., an Internet marketing firm                  
which provides products and services similar to those offered by                
Fenton Graham.  From January 2000 to present, Mr. Schrage serves                
on a part-time                                                                  

12        

basis as the Director of Administration with                                    
Quantum Leap Media, Inc., another Internet marketing firm which                 
provides products and services similar to those offered by Fenton               
Graham.  Quantum Leap Media is in the process of winding down its               
affairs and plans to cease operations by August 2002.  In                       
December 1999, Mr. Schrage graduated with Honors from the                       
University of Arizona, with a triple major in Entrepreneurship,                 
Finance, and Marketing.  He completed applicable course work such               
as Development of New Venture Plans, Marketing Planning and                     
Operating Decision-Making, New Venture Development and Industry                 
Analysis, New Venture Marketing and Finance, Consumer Behavior,                 
International Marketing Management, Services Retailing, Marketing               
Research, Investments, Real Estate Finance and Investments, and                 
Corporate Finance.  From August 1995 until December 1999, during                
his time at the University, Mr. Schrage honed his management                    
skills with a variety of employers, includingWal-Mart, Planet                   
Video and Poma's restaurant.                                                    

The Company's Board of Directors has not established any                        
committees.                                                                     

Conflicts of Interest                                                           
---------------------                                                           

As described above, J.P. Schrage is engaged in other businesses                 
on a part-time basis. As a result, certain conflicts of interest                
may arise between Fenton Graham and Mr. Schrage.  The officers                  
and directors of Fenton Graham are accountable to it and its                    
shareholders as fiduciaries, which requires that such officers                  
and directors exercise good faith and integrity in handling the                 
company's affairs. A shareholder may be able to institute legal                 
action on behalf of Fenton Graham or on behalf of itself and                    
other similarly situated shareholders to recover damages or for                 
other relief in cases of the resolution of conflicts is in any                  
manner prejudicial to Fenton Graham.                                            

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT                

The following table sets forth each person known to us, as of the               
date of this Prospectus to be a beneficial owner of five percent                
(5%) or more of the Company's outstanding common stock and our                  
sole officer and director.  No other class of voting securities                 
is outstanding.  Mr. Schrage has sole voting and investment power               
with respect to the shares shown.                                               

Name and Address of           Amount and Nature of         Percent of           
Beneficial Owner              Beneficial Ownership            Class             
-------------------           ---------------------        ----------           

J.P. Schrage                    5,000,000 Direct              83.3%             
c/o Fenton Graham                                                               

DESCRIPTION OF SECURITIES               

The authorized capital stock of Fenton Graham consists of                       
100,000,000 shares of Common Stock, $0.001 par value per share.                 
Upon completion of this offering, assuming all the shares are                   
sold, there will be 11,000,000 shares of common stock                           
outstanding.                                                                    

13              

Common Stock                                                                    
------------                                                                    

Holders of common stock are entitled to one vote for each share                 
held on all matters submitted to a vote of stockholders,                        
including the election of directors.                                            

Holders of common stock do not have subscription, redemption or                 
conversion rights, nor do they have any preemptive rights.                      

Holders of common stock do not have cumulative voting rights,                   
which means that the holders of more than half of all voting                    
rights with respect to common stock can elect all of Fenton                     
Graham's directors.  The Board of Directors is empowered to fill                
any vacancies on the Board of Directors created by resignations,                
subject to quorum requirements.                                                 

Holders of common stock will be entitled to receive such                        
dividends, if any, as may be declared from time to time by the                  
Board of Directors out of funds legally available therefor, and                 
will be entitled to receive, pro rata, all assets of the Company                
available for distribution to such holders upon liquidation.                    
There are currently 19 shareholders of record of Fenton Graham's                
common stock. To date, Fenton Graham has paid no dividends on its               
common stock, and intends, for the near future, not to pay                      
dividends, but, instead, to retain any earnings to finance future               
growth.                                                                         

INTEREST OF NAMED EXPERTS AND COUNSEL               

No named expert or counsel was hired on a contingent basis, will                
receive a direct or indirect interest in the small business                     
issuer, or was a promoter, underwriter, voting trustee, director,               
officer or employee of the small business issuer.                               

DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR                
SECURITIES ACT LIABILITIES                

Insofar as indemnification for liabilities arising under the                    
Securities Act may be permitted to directors, officers and                      
controlling persons of Fenton Graham pursuant to the Nevada                     
General Corporation Law or the provisions of Fenton Graham's                    
Articles of Incorporation, as amended, or Bylaws, or otherwise,                 
Fenton Graham has been advised that in the opinion of the                       
Commission such indemnification is against public policy as                     
expressed in the Securities Act and is, therefore, unenforceable.               
In the event that a claim for the indemnification against such                  
liabilities, other than the payment by Fenton Graham of expenses                
incurred or paid by a director, officer or controlling person of                
the company 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, Fenton               
Graham will, unless in the opinion of its counsel the matter has                
been settled by controlling precedent, submit to a court of                     
appropriate jurisdiction the question whether such                              
indemnification by it is against public policy as expressed in                  
the Securities Act and will be governed by the final adjudication               
of such issue.                                                                  

14              

ORGANIZATION WITHIN THE LAST FIVE YEARS               

Fenton Graham was founded on October 12, 2001 by Ken Greble and                 
J.P. Schrage.  Mr. Greble and Mr. Schrage received 2,500,000                    
shares each in consideration of services provided to Fenton                     
Graham valued at $2,500 each.   Mr. Greble and Mr. Schrage were                 
compensated for assisting in the formation of the Company and                   
development of the Company's proprietary software.                              

On July 5, 2002, Mr. Greble resigned from his positions as                      
President and director of the Company and he tendered back his                  
2,500,000 shares to the Company.  The shares were cancelled and                 
reissued to Mr. Schrage in consideration of his continued                       
services to the Company.                                                        

DESCRIPTION OF BUSINESS               

Overview                                                                        
--------                                                                        

Since our inception last year, we have had no revenue and have                  
generated operating and net losses.  We were formed for the                     
purpose of becoming a results driven Internet marketing company                 
that specializes in providing its clients with custom Internet                  
marketing campaigns.                                                            

We plan to target small and medium sized businesses in North                    
America, primarily in the United States.  We will offer Internet                
marketing services and use our media expertise and proprietary                  
software technology to provide these companies with complete                    
solutions to close the marketing circle by helping them build                   
brands, acquire new customers, increase traffic, drive sales and                
grow customer relationships.  We have nearly completed developing               
our WarRoom and Redirector software technology which will deliver               
solutions to marketers that include pop-ups, domain redirects,                  
banner ads, affiliate programs, and other marketing methods.                    
This will create a compelling marketing solution: the ability to                
deliver the right message at the right time to the right person.                

Services                                                                        
--------                                                                        

Our services will be designed to allow our clients to interact in               
an environment that maximizes e-mail, Web-based and wireless                    
inventory, while driving one-to-one, business-to-consumer                       
communication that stimulates transactions, optimizes campaigns                 
in real time and fosters the development of loyal relationships                 
with customers.  Following is a brief description of each of the                
services we will provide.                                                       

Goals Analysis - We will begin with a phone interview about our                 
client's desires, visions and goals for the purpose of                    
developing a rough sketch of the scope of the project.                    

Analysis of Competition - Part of the preliminary site review                   
that we will do includes online searches using keywords to                
find our client's competition.  Discovering what their                    
competition is doing online can be the launching pad for                  
fresh ideas.                                                              

Web Site Marketing Analysis - We will analyze our client's                      
existing site with respect to titling, keyword use, search engine         
strategy implementation, alternative statement use and current            

15                

online and offline marketing strategies. As part of                       
an extensive site review, we will create a report listing                 
their company's current rankings along with recommendations               
for enhancements.                                                         

In addition to market analysis we will perform a technical                
review, checking for coding issues that may impact search                 
engine positioning as well as overall Web page performance.               
Load times are also an important factor in site creation and              
maintenance. The main incentive for users to buy online are               
convenience and the amount of time saved.                                 

Site Design - A well-designed Web site attracts customers,                      
strengthens brand positioning and differentiates a company                
from its competition.   We plan to develop a design program               
which will deliver a Web site that maximizes our client's                 
business opportunities in a fast, cost effective way, using               
proven Web architecture.                                                  

Online Ad Creation and Placement - A targeted campaign of well-                 
crafted ads placed in carefully researched locations can lead             
to volumes of quality traffic. After assessment of goals, we              
will develop a budgeted and targeted program for our client's             
review, and then place ads as planned.                                    

Targeted E-mail Campaigns - We believe a combination of written e-              
mails and e-mail lists can work well when informing potential             
customers of our client's products and services.  We will                 
assist our clients in making the right choices to avoid                   
spamming and unwanted attention, while generating traffic.                

Offline Strategy Development - We will work with our clients                    
developing offline advertising opportunities designed to                  
drive visitors to their Web site.                                         

Online Advertising Services                                                     
---------------------------                                                     

We plan to administer the following advertising vehicles for any                
e-business. We will develop advertising campaigns, ensure against               
fraudulent advertisers with our proprietary software and review                 
and measure the results.                                                        

CTP = Content Transfer Pages- these pages appear on Web               
sites as a separate browser usually sized as a 400 x                  
400 pixel pop-up. These are fully navigable browsers                  
that show your site and its contents.                                 

CPA = Cost Per Acquisition - these advertisements                     
appear on a Web site and the advertiser is charged only               
when the visitor takes a predetermined action (i.e.                   
signing up for a membership or subscription.)                         

CPC = Cost Per Click through - these advertisements                   
appear on a Web site and the advertiser is charged only               
when the Web surfer clicks on the advertisers ad.                     

16              

CPM = Cost per Thousand - this type of advertising                    
consists of banner style ads that the advertiser is                   
charged per thousand impressions that appear on Web                   
sites.                                                                

Online Traffic Generation                                                       
-------------------------                                                       

Our goal is to continually find new ways to harness highly                      
targeted Internet traffic.  This traffic will be used in                        
campaigns for our clients.  The primary traffic techniques we are               
currently developing are:                                                       

-  Pop-up Windows                                                     
-  Domain Names                                                       
-  Banner Advertising                                                 
-  Banner Exchanges                                                   
-  Exit Traffic Retention                                             
-  Search Engine Positioning                                          
-  Paid Directory Listings                                            
-  E-mail Marketing                                                   
-  Affiliate Programs                                                 

Pop-up Windows are advertisements that "pop-up" in a new window                 
as people are browsing Internet sites.  Pop-ups can be purchased                
for relatively low amounts of money from large networks of web                  
sites.  This can provide quick exposure on large web sites for                  
clients of Fenton Graham.  Pop-ups are low priced and cannot be                 
marked up much, but large profits can still be realized as                      
clients will purchase campaigns of 500,000 or 1,000,000 or more                 
pop-ups.  Pop-ups can also be deployed when people leave web                    
sites.  These are generally more cost effective while working                   
just as well.                                                                   

Domain Names are typed in by Internet users into a web browser to               
get them where they're going (i.e.: yahoo.com).  Many domain                    
names generate significant amounts of traffic from people typing                
them into their web browsers (i.e.: travel.com or even                          
misspellings of popular domains such as yhaoo.com).  This traffic               
can be "rented" from the owners of the domain names.  As an                     
example, Fenton Graham might have an online travel agent as a                   
client.  Fenton Graham would then find the people or companies                  
that own domain names related to travel such as vacations.com.                  
If Fenton Graham could successfully "rent" the traffic from the                 
owner of vacations.com, everyone that types in vacations.com                    
would essentially be redirected to the travel agent's site.  The                
web surfer gets redirected to a useful site (when otherwise they                
might have received a page not found error), the travel agent                   
gets a possible sale, and Fenton Graham gets paid by the travel                 
agent for marketing their site.                                                 

Banner Advertisements are commonly used on most Internet web                    
pages.  They act as small billboards for the countless products                 
and services that are advertised on the Internet.  Fenton Graham                
will locate competitively priced banner ad inventory from leading               
publishers.  This allows us to offer our clients a positive                     
return on their advertising dollars while building brand                        
recognition at the same time.                                                   

17                

Banner Exchanges allow webmasters to trade advertising space on                 
their web page in return for advertising space on someone else's                
web page.  The goal is to participate in targeted banner                        
exchanges by capitalizing on our ability to generate online                     
traffic.  We will accumulate banner credits for each of our                     
clients.  Each banner credit is worth one advertisement on a                    
webpage.  In most cases one banner credit is given to us for                    
every two banners that we display.                                              

Exit Traffic is the large amount of "lost" online traffic                       
commonly known as "404 Error Traffic" or "File Not Found."  An                  
estimated 5% of all pages downloaded from the Internet end up as                
404 Errors (Pitkow, 1998).  This translates into over 100 million               
pages daily.  This traffic can be garnered by purchasing the 404                
traffic from web hosting companies.                                             

Search Engine Positioning is the process of designing and                       
submitting your web page to search engines in a way that makes                  
your page be displayed higher in search results than your                       
competitors' pages.  Search engine positioning is a constantly                  
evolving art.  Currently, meta tags (script at the beginning of                 
web pages that can only be seen by robots on the web), keywords,                
and content are three of the biggest factors in getting high                    
search engine rankings.  Fenton Graham can apply its knowledge to               
any client's web site to make it a top performer on most of the                 
major search engines.                                                           

Paid Directory Listings.  This involves paying pay-per-click                    
search engines, such as overture.com, for rankings.  In order to                
have a high ranking for a particular key word, you must outbid                  
others who want to be listed high for that same key word.                       

E-mail Marketing.  We will compile large databases of "opt-in"                  
subscribers, people who have requested to receive various types                 
of offers, via in-house marketing efforts.  We will also purchase               
or rent targeted e-mail lists from reputable suppliers if needed.               

Affiliate Programs.  We will be able to set up affiliate programs               
for any of our clients.  This is basically establishing an army                 
of web sites linking back to our client's web site in return for                
a CPA (cost per action) reward.  Third party monitoring is                      
provided by sites such as Commission Junction, BeFree, and                      
Linkshare.                                                                      

Software                                                                        
--------                                                                        

We are developing two proprietary programs to be used internally                
to serve and track online campaigns:                                            

The Redirector - The Redirector works strictly with domain names                
and the traffic they generate.  For example, if Fenton Graham             
rents the traffic from a domain name, that domain name is                 
pointed to the Fenton Graham servers.  From there, the                    
traffic from the domain name is funneled through The                      
Redirector to be sent to the correct Fenton Graham client's               
Website.  Full tracking and statistics are kept throughout                
the process.  The program was developed using ColdFusion, a               
programming language, and SQL, a Microsoft database                       
application.  The Redirector has a web page from which                    
administrative functions and tracking can be performed.                   

18              

WarRoom - WarRoom handles all other types of traffic that Fenton                
Graham will buy and sell.  Banner ads, pop-ups, and exit                  
traffic will all go through WarRoom.  WarRoom is a powerful               
program that can be set up to begin with an inventory of                  
traffic available on a given day, and disperse the traffic to             
many different clients in a targeted manner with full                     
accounting and statistics tracking.  In essence, WarRoom                  
automates the entire process.  Humans buy and sell the                    
traffic and enter what they've bought and sold into WarRoom,              
but WarRoom handles the rest.  WarRoom will automatically                 
send the purchased traffic to the correct clients based on                
the type of traffic they should receive.  The program was                 
developed using ColdFusion, a programming language, and SQL,              
a Microsoft database application.  WarRoom has a web page                 
from which administrative functions and tracking can be                   
performed.  WarRoom also has a log in page for clients and                
vendors where they can see their statistics and invoices.                 

Both The Redirector and WarRoom are functional programs.  In                    
order to be complete and ready for use in our business, the                     
following must be finished:                                                     

-  Minor tracking bugs worked out                                       
-  Automatic billing incorporated into the software                     
-  User friendly client log-in area - backend programming as            
well as graphic design                                            

Currently, we do not plan to seek a patent or other similar                     
intellectual property protection for the software.                              

Privacy Concerns                                                                
----------------                                                                

We believe that issues relating to the privacy of Internet users                
and the use of personal information about these users are                       
extremely important. In the course of delivering ads to a Web                   
user, we will only collect non-personally identifiable                          
information about the Web user. We do not collect any personally                
identifiable information about the Web user unless the Web user                 
voluntarily and knowingly provides personally identifiable                      
information.                                                                    

In implementing any service or program designed to gather                       
consumer data, we will always be mindful of our commitment to                   
uphold the privacy principles of the Direct Marketing                           
Association. We will actively monitor privacy laws and                          
regulations and seek to comply with all applicable privacy                      
requirements.                                                                   

Sales and Marketing                                                             
-------------------                                                             

Our staff will work strategically with our customers to develop                 
comprehensive marketing solutions. We believe that our clients                  
desire integrated programs that go beyond the banner to include                 
content integration, contextual sponsorships, promotions,                       
sweepstakes, e-mail sponsorships, pop-ups, custom content and                   
other highly effective advertising tools.  When fully staffed,                  
our personnel will possess the marketing, media, creative and                   
advertising skills required to develop sophisticated advertising                
campaigns.                                                                      

19                

Our personnel will be trained to use a variety of marketing                     
programs to generate demand for our products and services, build                
market awareness, develop customer leads and establish business                 
relationships. Our marketing activities will include public                     
relations, print advertisements, online advertisements and direct               
marketing, Web advertising seminars, trade shows, special events                
and ongoing customer communications programs.                                   

We currently have no contracts with advertisers and will not have               
any until our software is complete and we are able to begin                     
business.                                                                       

The marketing towards advertisers that we will do will cost                     
approximately $8,000 per year.  This money will be used for media               
kits and various forms of advertising.                                          

Seasonality and Cyclicality                                                     
---------------------------                                                     

J.P. Schrage, who serves as our sole officer and director, has                  
previous experience in this business and has found that it is                   
subject to seasonal fluctuations.  It has been his experience                   
that marketers generally place fewer advertisements during the                  
first and third calendar quarters of each year, and direct                      
marketers generally mail substantially more marketing materials                 
in the third calendar quarter of each year. In addition, he found               
that expenditures by advertisers and direct marketers vary in                   
cycles and tend to reflect the overall economic conditions, as                  
well as budgeting and buying patterns. Furthermore, user traffic                
on the Internet seemed to decrease during the summer months which               
resulted in fewer advertisements to sell and deliver. A decline                 
in the general economy or in the economic prospects of                          
advertisers and direct marketers could adversely affect our                     
revenue.                                                                        

Competition                                                                     
-----------                                                                     

The market for interactive, Internet-based marketing solutions is               
extremely competitive. We believe that our ability to compete                   
depends upon many factors both within and beyond our control,                   
including the following:                                                        

- the timing and market acceptance of new solutions and               
enhancements to existing solutions developed either by us or our  
competitors;                                                      

- the continued and increasing acceptance by marketers of the         
Internet as an effective and cost-efficient means of advertising; 

- the ability to adapt to the rapidly changing trends of the          
Internet;                                                         

- our customer service and support efforts;                           

- our sales and marketing efforts;                                    

- our ability to adapt and scale our technology as customer           
needs change and grow; and                                        

20          

- the ease of use, performance, price and reliability of              
solutions developed either by us or our competitors.              

As we expand the scope of our Web services, we may face greater                 
competition from a number of Web sites and other media companies                
across a wide range of different Web services, including in                     
vertical markets where competitors may have advantages in                       
expertise, brand recognition and other factors. Several companies               
offer competitive products or services through Web advertising                  
networks, including DoubleClick, 24/7 Media and Engage                          
Technologies. Our business may also encounter competition from                  
providers of advertising inventory and database management                      
products and related services, including DoubleClick and Engage                 
Technologies. In addition, we may face potential competition from               
a number of large Web search engine companies, such as America                  
Online, Infoseek and Yahoo! We will also compete with television,               
radio, cable and print for a share of the overall advertising                   
budgets of marketers.                                                           

The Fenton Graham Difference                                                    
----------------------------                                                    

While a number of companies are competing in the Internet based                 
marketing solutions business, we believe that advertisers will                  
utilize our services instead of those of the established                        
competitiors for a number of reasons.                                           

Flexible Technology.  Fenton Graham's WarRoom and Redirector                    
technology is being developed to serve and track the                            
sophisticated, relationship-building marketing programs that are                
designed to convert Internet users into loyal, long-term                        
customers for businesses. This comprehensive technology will be                 
intuitive and flexible.  The WarRoom and Redirector will track                  
campaigns and provide real-time, customized reports, allowing                   
marketers to increase the effectiveness of their marketing                      
efforts and to realize the value of their customer base. In                     
essence, our proprietary software will provide our clients with a               
full suite of serving, tracking, management and measurement                     
tools.                                                                          

Marketing. Fenton Graham intends to hire a staff with experience                
and a rich knowledge base to offer clients counsel and expertise                
in developing an integrated, Internet strategy designed to meet                 
branding, customer acquisition, and revenue-generating goals. Our               
marketing services will include assisting marketers in designing                
contextually relevant marketing campaigns that attract and retain               
the Internet user.                                                              

We believe that we will be competitive in our industry because                  
Fenton Graham will offer full service sales and marketing                       
solutions designed to allow our client's to interact in an                      
environment that maximizes e-mail, Web-based and wireless                       
inventory, while driving one-to-one, business-to-consumer                       
communication that stimulates transactions, optimizes campaigns                 
in real time and fosters the development of loyal relationships                 
with their customers.                                                           

21                

Intellectual Property                                                           
---------------------                                                           

On July 15, 2002, Fenton Graham purchased all rights, title and                 
interest in theWar Room and Redirector technologies from Quantum                
Leap Media, Inc. who was developing the software.  We will hire                 
outside consultants to assist us in completing the development                  
and hope to have fully workable versions of the technologies no                 
later than the fourth quarter 2002.                                             

We do not plan to seek a patent or other similar intellectual                   
property protection.  We intend to enter into confidentiality or                
license agreements with our employees, consultants and corporate                
partners in order to control access to and distribution of our                  
technologies, documentation and other proprietary information.                  
Despite these efforts, unauthorized parties may attempt to                      
disclose, obtain or use our advertising solutions or                            
technologies. Our precautions may not prevent misappropriation of               
our advertising solutions or technologies, particularly in                      
foreign countries where laws or law enforcement practices may not               
protect our rights as fully as in the United States.                            

Our technology will collect and utilize data derived from user                  
activity on the Internet. This information will be used for                     
targeting advertising and predicting advertising performance.                   
Although we believe that we generally have the right to use this                
information and to compile it in our database, we cannot assure                 
you that any trade secret, copyright or other protection will be                
available for this information. In addition, others may claim                   
rights to this information. Furthermore, we cannot guarantee that               
any of our intellectual property will be viable or valuable in                  
the future since the validity, enforceability and scope of                      
protection of intellectual property in Internet related                         
industries is uncertain and still evolving. In addition, third                  
parties may assert infringement claims against us. Any claims                   
could subject us to significant liability for damages and could                 
result in the invalidation of our intellectual property rights.                 
In addition, any claims could result in litigation, which would                 
be time-consuming and expensive to defend, and divert our time                  
and attention. Even if we prevail, this litigation could cause                  
our business, results of operations and financial condition to                  
suffer. Any claims or litigation from third parties may also                    
result in limitations on our ability to use the intellectual                    
property subject to these claims or litigation unless we enter                  
into arrangements with the third parties responsible for these                  
claims or litigation, which could be unavailable on commercially                
reasonable terms. We believe that factors such as the                           
technological and creative skills of our personnel, new service                 
offerings, brand recognition and reliable customer service are                  
more essential to establishing and maintaining our position in                  
the marketplace, rather than the legal protection of our                        
technology. We cannot assure you that others will not develop                   
technologies that are similar or superior to our technology.                    

Employees                                                                       
---------                                                                       

Currently, the only employee is our sole officer, J.P. Schrage,                 
who is currently working part-time.  Over the next few months, we               
plan to hire 3 contract workers to assist in completing the                     
development of our software and technology.  We are not subject                 
to any collective bargaining agreements and believe that our                    
employee relations are excellent.  Our future success depends in                
part on our ability to attract, retain, integrate and motivate                  
highly-skilled employees.  Competition for employees in the                     
industry is moderate.                                                           

22              

MANAGEMENT'S PLAN OF OPERATION                

Overview                                                                        
--------                                                                        

Fenton Graham was recently formed to provide online marketing                   
services to small to medium sized companies.  We plan to supply                 
Internet traffic to the Websites of our clients by using                        
marketing expertise and traffic generation techniques such as pop-              
up windows, domain names, banner ads, banner exchanges, exit                    
traffic, search engine positioning, paid directory listings,                    
e-mail marketing and affiliate programs.  We will also assist our               
clients in developing relationships with vendors.                               

As additional funds become available, our objective is to                       
position ourself as a leading provider of technology and                        
marketing solutions that are designed to go beyond simple banners               
to produce better customer conversion rates, resulting in higher                
prices for our clients' inventory and more value for marketers.                 
However, there is no assurance that we will be successful in                    
doing so.                                                                       

Plan of Operations                                                              
------------------                                                              

During the next 12 months, we plan to complete the development of               
our proprietary software, purchase or lease hardware, hire an                   
initial staff, and begin business.  We anticipate requiring                     
approximately $100,000 to fund our minimum level of operations                  
during this period.  Approximately $12,000 will be used to                      
complete the development of our software and business, $8,000                   
will be used to purchase or lease hardware, $16,000 will be used                
towards office space and related equipment, $8,000 will be used                 
in advertising, $5,000 is set aside for legal and accounting                    
assistance, $45,000 to facilitate the hiring of staff, and $1,000               
will be general working capital.                                                

Our current cash is not adequate to satisfy our requirements.                   
This stock offering is a critical aspect of our plan and it is                  
intended to provide the funds necessary to develop our                          
proprietary software and to establish operations. Without the                   
maximum funds provided from this offering, our plan could not                   
proceed as contemplated.                                                        

The timing and extent of our growth will depend upon our ability                
to raise additional funds. To the extent that we are able to sell               
all of the shares offered hereby, it will allow us to accelerate                
our timetable. If we are only able to sell the a small amount of                
the shares offered hereby, then we anticipate that the amount of                
time necessary for us to achieve our goals will be greater and we               
may not be able to realize our goals before our financial                       
resources are depleted.                                                         

Management believes we will need to raise between $100,000 and                  
$200,000 over the next 24 months, which include the funds raised                
in this offering.  The exact amount we will need to raise will be               
determined by the then current market conditions, and the status                
of cash flow within Fenton Graham.  It is anticipated that an                   
initial injection of $100,000 will be required within the next 12               
to 15 months.  If we are unsuccessful in raising the maximum                    
amount in this offering, we will need to raise the additional                   
amount we need by selling shares of our common stock through one                
or more private placements followed by a secondary public                       
offering if necessary.  Should we                                               

23          

fail to raise at least $100,000 during the next 12 months from this             
and other offerings, we will not be able to fulfill our business plans          
and you could lose your entire investment.                                      

Should management decide that raising funds by means of one or                  
more private placements or a secondary public offering would be                 
detrimental to Fenton Graham and its shareholders due to adverse                
stock market conditions or because our cash flow is limited as a                
result of little or no revenues, we will attempt to secure a line               
of credit with an established financial institution to assist                   
with the software development, staffing, marketing and general                  
working capital purposes.                                                       

Costs and Expenses                                                              
------------------                                                              

Currently, we have minimal monthly expenditures.  We will use the               
funds raised in this offering to complete the development of our                
software, hire people as employees and on a contract basis,                     
market our services and begin business.  During the next 12                     
months, we intend to hire one employee to handle administrative                 
and marketing tasks and we intend to hire, on a contract basis,                 
three technical consultants to complete the development of our                  
software and handle hardware issues.                                            

To date, our business has been in the early stages of development               
and has had no operations.  Accordingly, we have had no revenues.               
All incurred expenses have been funded by our private offering.                 
We are dependent upon the raising of capital through placement of               
our common stock.  There can be no assurance that we will be                    
successful in raising the capital we require to complete each of                
our Milestones detailed below through the sale of our common                    
stock.                                                                          

Milestones                                                                      
----------                                                                      

Our business plan is to develop a complete Internet marketing                   
business.  We will need to raise at least $100,000 from this                    
offering in order to implement our plan of operations for the                   
next 12 months.  This minimum amount of capital must be raised in               
order for us to properly execute our plan of operations.  The                   
shares are being offered and sold on a best efforts basis.  If we               
fail to sell all of the shares offered, we will need to raise                   
additional funds through more offerings of our common stock to                  
achieve the following milestones.                                               

Milestone 1: Establish an Office.  We currently have an office                  
from where we can conduct operations.  We anticipate total office               
costs to be $23,000 for the next 12 months.  This includes legal and            
accounting expense, rent, equipment such as computers and telephones,           
and utilities.                                                                  

Milestone 2:  Complete Software Development.  We will need at                   
least $8,000 to complete the development of our proprietary                     
software.  On July 1, 2002, when we acquired the software from                  
Quantum Leap Media, Inc. the software was not fully developed.                  
Currently, the Redirector and WarRoom can redirect domains and                  
serve ads as required, but they still need to be able to track                  
all of this and present the information to clients in a well                    
formatted online report.  It is anticipated that following                      
completion of this software, sales to clients could begin almost                
immediately.                                                                    

24            

Milestone 3: Purchase/Lease Hardware.  We intend to lease three                 
dual pentium servers with a minimum of 1 Gigabyte of RAM and                    
purchase all peripherals including a backup device and                          
miscellaneous cabling.  This will allow us to serve and track the               
traffic we buy.  (Accurate tracking of the traffic is very                      
important as it is how we will bill our clients).  This will cost               
at least $8,000 over the next 12 months.                                        

Milestone 4: Hire Staff.  We will engage an administrative person               
as well as additional technical people. We expect that we may                   
hire one administrative person during our first year of business.               
We expect that we may engage two to three technical people on a                 
contract basis to help design software, configure hardware, and                 
keep our systems up and running.  The hiring process would                      
include running advertisements in the local  newspaper and on the               
Internet and conducting interviews.  It is estimated that to hire               
a full time administrative person, as well as have a technical                  
team available on a contract basis will cost $45,000 per year.                  

Milestone 5: Develop Marketing Campaign. The next step would be                 
to develop an advertising campaign, including establishing a list               
of prospects based on potential clients identified in the market                
survey, and designing and printing sales materials.                             

Potential clients of Fenton Graham Marketing are small to medium                
sized companies in North America, and primarily the United                      
States.  These companies in most cases will already be offering a               
product or service on the Internet.                                             

It is anticipated that it would take approximately six to eight                 
weeks to develop the advertising campaign, although, depending on               
the availability of resources, we will attempt to develop our                   
advertising campaign concurrently with establishing an office,                  
developing software, purchasing hardware, and hiring employees                  
and consultants. The cost of developing the first campaign is                   
estimated at approximately $3,000.                                              

Milestone 6: Implementation of Advertising Campaign and Sales                   
Calls.  Implementation of the advertising campaign would begin                  
with sending out e-mails and calling prospective clients.                       
Immediately following this, we would begin telephone follow ups.                
The cost of these first round sales efforts is estimated at                     
$8,000.                                                                         

Milestone 7: Achieve Revenues. It is difficult to quantify how                  
long it will take to convert our efforts into actual sales and                  
revenues.  We hope that clients will begin using our services                   
within days of implementation of our advertising campaign, but it               
may take several weeks before people begin to purchase our                      
services.  Moreover, customers may not be willing to pay for the                
service at the time they order, and may insist on buying on                     
account, which would delay receipt of revenues another month or                 
two. Assuming we have received all necessary approvals to begin                 
raising funds by July 1, 2002, and assuming an offering period of               
approximately one month, in a best case scenario we may receive                 
our first revenues by year end.  However, a more realistic                      
estimate of first revenues would be March 1, 2003 or later.                     
Fenton Graham will not generate revenues directly from the sale                 
or leasing of any software; we will use our software as a means                 
for delivering our product, targeted Internet traffic.  Our                     
revenue will come from clients that receive our Internet                        
marketing efforts which include things like banner ads, pop-up                  
ads, and domain                                                                 

25              

redirects.  We will be paid based on the number of people we send               
to a client's site or on a percentage of sales generated from the               
people we send to their site.                                                   

We have no current plans, preliminary or otherwise, to merge with               
or acquire any other entity.                                                    

DESCRIPTION OF PROPERTY               

Our principal administrative, sales, marketing, research and                    
development offices are located at 13215 Verde River Drive, Unit                
1, Fountain Hills, Arizona 85268.  On February 1, 2002, we                      
entered into an agreement to lease, on a month-to-month basis,                  
1,485 square feet at a cost of $1,431 per month.                                

Our servers will be housed at Technology Alliance Group (TAG) in                
Scottsdale, Arizona.  VVVRRR, Inc. (VRI), a company for which our               
President, J.P. Schrage, is employed on a part-time basis,                      
leases, on a month-to-month basis, approximately half of one                    
server rack in TAG's data center and uses about 2.5 Megabits of                 
bandwidth.  VRI is responsible for payment of the monthly                       
datacenter fees to TAG and we pay VRI $200 per month for the use                
of 1/8 of the rack of space and 1 Megabit of bandwidth.  The                    
facility at TAG will provide us with a secure area to store and                 
operate our computer systems and capacity for communications                    
links and Internet connectivity systems.  We will continually                   
evaluate our facility requirements. We believe that the space                   
leased from VRI will be more than adequate for our initial                      
operations.                                                                     

Since Fenton Graham is incorporated in Nevada it is required to                 
maintain a resident office in that state in which corporate                     
documents are available. The resident office is located at 777 N.               
Rainbow Blvd., Suite 390, Las Vegas, Nevada 89107.  No activities               
take place in the resident office and no fees are charged by the                
resident agent at this address.  All other activities have been                 
consolidated to the facilities described above.                                 

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                

On October 17, 2001 our founding officers and directors, Ken                    
Greble and J.P. Schrage, each received 2,500,000 shares of our                  
common stock for assisting in the formation of Fenton Graham and                
development of our proprietary software.  The services were                     
valued at at $2,500 each.                                                       

In December 2001, Ken Greble, former President and a director of                
Fenton Graham, loaned the Company $1,100, which was used to pay                 
the costs related to the sales of the Company's common stock in a               
private placement. The loan was non-interest bearing and was                    
repaid on April 8, 2002 from the proceeds of the private                        
placement.                                                                      

On July 1, 2002, Fenton Graham entered into a co-location                       
agreement with VVVRRR, Inc. (VRI) for the use of a portion of the               
space VRI leases from Technology Alliance Group (TAG) to house                  
its servers.  Fenton Graham will pay VRI $200 per month, on a                   
month-to-month basis, for partial use of the space it leases from               
TAG.  Our President, J.P. Schrage, is employed by VRI on a part-                
time basis.  Mr. Schrage is not an officer, director or owner of                
VRI and receives no benefit from the lease payments made by                     
Fenton Graham to VRI.                                                           

26              

On July 5, 2002, Mr. Greble resigned as an officer and director                 
and returned his 2,500,000 shares to the Company for                            
cancellation.  The shares were cancelled and reissued to Mr.                    
Schrage in consideration of his continued services to the                       
Company.                                                                        

On July 12, 2002, Fenton Graham purchased for $20,000 cash all                  
rights, title and interest in the Redirector and WarRoom software               
from Quantum Leap Media, Inc. (QLM).  Mr. Schrage has been                      
employed by QLM since January 2000 on a part-time basis as the                  
Director of Administration.  Mr. Schrage in not an officer,                     
director or owner of QLM and received no benefit from the sale of               
the software to Fenton Graham.  QLM is in the process of winding                
down its affairs and plans to cease operations in August 2002.                  

MARKET FOR COMMON STOCK AND RELATED SHAREHOLDER MATTERS               

Market Information                                                              
------------------                                                              

As of the date of this prospectus and for the foreseeable future,               
there is no public or private market for our shares.  Management                
has not undertaken any discussions, preliminary or otherwise,                   
with any prospective market maker concerning his participation in               
the after-market for the our securities and Management does not                 
intend to initiate any discussions until we have raised enough                  
capital to conduct our business. There is no assurance that a                   
trading market will ever develop or, if a market does develop                   
that it will continue.                                                          

Holders                                                                         
-------                                                                         

There are currently 19 holders of Fenton Graham's common stock.                 

Dividends                                                                       
---------                                                                       

We do not have a policy of paying dividends, and it is currently                
anticipated that no cash dividends will be paid in order to                     
retain earnings to finance future growth. Any future decision to                
pay cash dividends will be made on the basis of earning,                        
alternative needs for funds and other conditions existing at the                
time.                                                                           

Shares Eligible for Future Sale                                                 
-------------------------------                                                 

As of the date of this Prospectus, we had an aggregate of                       
6,000,000 shares of our common stock issued and outstanding, all                
of which are "restricted securities," which may be sold only in                 
compliance with Rule 144 under the Securities Act of 1933, as                   
amended or exemptions from registration requirements of this act.               
Rule 144 provides, in essence, that a person holding restricted                 
securities for a period of one year after payment therefore may                 
sell, in brokers' transactions or to market makers, an amount not               
exceeding 1% of the outstanding class of securities being sold,                 
or the average weekly reported volume of trading of the class of                
securities being sold over a four-week period, whichever is                     
greater, during any three-month period. (Persons who are not our                
affiliates and who had held their restricted securities for at                  
least two years are not subject to the volume or transaction                    
limitations.) The sale of a significant number of these shares in               
the public market may adversely affect prevailing market prices                 
of our securities.                                                              

27                  

EXECUTIVE COMPENSATION                

J.P. Schrage, our sole officer and director, does not receive any               
cash compensation for his services rendered to the Company nor                  
has he received any cash compensation in the past.  Mr. Schrage                 
received 2,500,000 shares of our common stock, valued at $2,500,                
for assisting us in our formation.  On July 5, 2002, when our                   
former President resigned, he returned the 2,500,000 shares owned               
by him to the Company which were cancelled and reissued to Mr.                  
Schrage in consideration for his continued services to the                      
Company, valued at $2,500.                                                      

Mr. Schrage has agreed to act without cash compensation until we                
have generated revenues from operations.  As of the date of this                
prospectus, we have no funds available to pay directors.                        
Further, Mr. Schrage is not accruing any compensation.                          

We have not adopted any retirement, pension, profit sharing,                    
stock option or insurance programs or other similar programs for                
the benefit of our employees.                                                   

28                  

FENTON GRAHAM MARKETING, INC.               
(A Development Stage Company)               

FINANCIAL STATEMENTS                

MARCH 31, 2002 (UNAUDITED)              
AND                 
DECEMBER 31, 2001               

CONTENTS                

                                        PAGE

INDEPENDENT AUDITORS' REPORT                                1                   

BALANCE SHEET                                               2                   

STATEMENT OF OPERATIONS                                     3                   

STATEMENT OF STOCKHOLDER'S EQUITY                           4                   

STATEMENT OF CASH FLOWS                                     5                   

NOTES TO FINANCIAL STATEMENTS                             6 - 9                 

29              

INDEPENDENT AUDITORS' REPORT                

TO THE BOARD OF DIRECTORS OF FENTON GRAHAM MARKETING, INC.:                     

We have audited the accompanying balance sheet of FENTON GRAHAM                 
MARKETING, INC. (A Development Stage Company) as of December                    
31, 2001 and the related statements of operations,                              
stockholders' equity and cash flows for the period from October                 
17, 2001 (inception) to December 31, 2001.  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 auditing standards                    
generally accepted in the United States of America.  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 FENTON GRAHAM MARKETING, INC. as of December 31,                    
2001 and the results of its operations and its cash flows for                   
the period from October 17, 2001 (inception) to December 31,                    
2001, in conformity with accounting principles generally                        
accepted in the United States of America.                                       

          MERDINGER, FRUCHTER, ROSEN & CORSO, P.C.
Certified Public Accountants  

New York, New York                                                              
January 31, 2002                                                                

- 1 -                   

30                    

FENTON GRAHAM MARKETING, INC.   
(A Development Stage Company)   
BALANCE SHEETS    

                                              March 31,     December 31,
                                            2002            2001
                                             -----------    ------------
ASSETS                                        (Unaudited)                 
Cash and cash equivalents                    $   96,023     $ 38,387  
Subscription receivable                               -       29,500  
 Total assets                              ------------   ----------
                                           $   96,023     $ 67,887
                                           ============   ==========

LIABILITIES AND STOCKHOLDERS' EQUITY                                      
Liabilities                                                               
Accounts payable and accrued expenses        $        -     $  1,000  
Due to officer                                    1,100        1,100  
                                           ------------   ----------
Total current liabilities                       1,100        2,100
                                           ------------   ----------

Stockholders' Equity                                                      
Common stock, $0.001 par value;                                       
25,000,000 shares authorized,                                     
6,000,000 and                                                             
5,385,000 shares issued and outstanding         6,000        5,385
Additional paid-in capital                       97,800       66,415  
Deficit accumulated during the                                        
development stage                              ( 8,877)     ( 6,013)
                                           ------------   ----------
Total stockholders' equity                     94,923       65,787
                                           ------------   ----------

Total liabilities and stockholders' equity  $  96,023     $ 67,887
                                           ============   ==========

The accompanying notes are an integral part of these financial statements.      

- 2 -   

31    

FENTON GRAHAM MARKETING, INC.   
(A Development Stage Company)   

STATEMENTS OF OPERATIONS    

                                                    October 17,  October 17,
                                       Three         2001         2001
                                         Months     (Inception)  (Inception)
                                      Ended          to           to
                                         March 31,   December 31, December 31,
                                        2002         2001         2002
                                       -----------   ----------  -----------
                                       (Unaudited)               (Unaudited)
Revenue                                $       -    $       -   $       - 

General and administrative expenses                                       
                                          2,864        6,013       8,877

Loss from operations before provision                                     
for income taxes                          (2,864)      (6,013)     (8,877)
                                       ----------   ----------  ----------

Provision for income taxes                                                
                                              -            -           -
                                       ----------   ----------  ----------

Net loss                               $  (2,864)   $  (6,013)  $  (8,877)
                                       ==========   ==========  ==========

Net loss per share - basic and diluted $       -    $       -   $       - 
                                       ==========   ==========  ==========

Weighted average number of common                                         
shares outstanding                      5,988,889    5,164,267   5,688,273
                                       ==========   ==========  ==========

The accompanying notes are an integral part of these financial statements.      

- 3 -   

32    

FENTON GRAHAM MARKETING, INC.   
(A Development Stage Company)   
STATEMENT OF STOCKHOLDERS' EQUITY   

                                                        [Enlarge/Download Table]
                                                                                                 
                                                                             Deficit             
                                                                           Accumulated           
                                           Common Stock       Additional    During the           
                                      ----------------------    Paid-In    Development           
                                        Shares      Amount      Capital       Stage       Total  
                                      ---------  -----------  -----------  -----------  -------- 

Balance, October 17, 2001                     -    $      -    $      -      $     -     $     - 

Issuance of founder share for         5,000,000       5,000           -            -       5,000 
 services - October 17, 2001                                                                     

Sale of shares for cash at $0.10        385,000         385      38,115            -      38,500 
 per share - November 28, 2001                                                                   
 through December 31, 2001                                                                       

Subscribed shares of common stock                                                                
 at $0.10 per share - November 28,                                                               
 2001 through December 31, 2001               -           -      29,500            -      29,500 

Costs incurred for private placement          -           -      (1,200)           -      (1,200)

Net Loss                                      -           -           -       (6,013)     (6,013)
                                      ---------   ---------   ---------     ---------    --------

Balance, December 31, 2001            5,385,000       5,385      36,915       (6,013)     65,787 

Issuance of subscribed stock                                                                     
 - January 2002                         295,000         295        (295)           -           - 

Sale of shares for cash at $0.10                                                                 
 per share - January 2002               320,000         320      31,680            -      32,000 

Net loss                                      -           -           -        (2,864)    (2,864)
                                      ---------   ---------   ---------     ----------  ---------
Balance, March 31, 2002 (Unaudited)   6,000,000   $   6,000   $  97,800     $  (8,877)  $ 94,923 
                                      =========   =========   =========     ==========  =========


The accompanying notes are an integral part of these financial statements.      

- 4 -   

33    

FENTON GRAHAM MARKETING, INC.   
(A Development Stage Company)   
STATEMENT OF CASH FLOWS   

                                                    October 17,  October 17,
                                       Three         2001         2001
                                         Months     (Inception)  (Inception)
                                      Ended          to           to
                                         March 31,   December 31, December 31,
                                        2002         2001         2002
                                       -----------   ----------  -----------
                                       (Unaudited)               (Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES                                            

   Net loss                             $  (2,864)   $  (6,013)   $  (8,877)

Adjustments to reconcile net loss                                     
to net cash used in operating                                     
activities:                                                     
     Stock issued for services                 -        5,000        5,000

(Decrease) increase in accounts                                 
      payable and accrued expenses        (1,000)       1,000            -
and accrued expenses                                          
     Increase in due to officer                -        1,100        1,100
                                       -----------   ----------   ----------
NET CASH PROVIDED BY OPERATING ACTIVITIES    (3,864)       1,087       (2,777)  

CASH FLOWS FROM FINANCING ACTIVITIES                                            
  Sale of common stock - net proceeds     32,000       66,800       98,800
  Stock subscription receivable           29,500      (29,500)           -
                                       -----------   ----------   ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES    61,500       37,300       98,800   

INCREASE IN CASH AND CASH EQUIVALENTS        57,636       38,387       96,023   

CASH AND CASH EQUIVALENTS - beginning of                                        
period                                      38,387            -            -  
                                       -----------   ----------   ----------

CASH AND CASH EQUIVALENTS - end of                                              
period                                   $  96,023     $ 38,387     $ 96,023  
                                       ===========   ==========   ==========

SUPPLEMENTAL INFORMATION:                                                       
During the period October 17, 2001 (inception) to December 31, 2001,      
the Company paid no cash for interest or income taxes.                    

NON-CASH FINANCIAL ACTIVITY:                                                    
The  Company issued 5,000,000 shares of common stock for services valued  
at $5,000.                                                                

The accompanying notes are an integral part of these financial statements.      

- 4 -   

34    

FENTON GRAHAM MARKETING, INC.               
(A Development Stage Company)               
NOTES TO FINANCIAL STATEMENTS               
MARCH 31, 2002 (UNAUDITED) AND DECEMBER 31, 2001                

NOTE 1 - DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT                     
ACCOUNTING POLICIES                                           

Nature of Operations                                                
--------------------                                                
Fenton Graham Marketing, Inc. (the "Company") is currently          
a development-stage company under the provisions of the             
Financial Accounting Standards Board ("FASB") Statement of          
Financial Accounting Standards ("SFAS") No. 7.  The                 
Company was incorporated under the laws of the state of             
Nevada on October 17, 2001.                                         

Interim Financial Information                                       
-----------------------------                                       
The accompanying unaudited interim financial statements             
have been prepared by the Company, in accordance with               
United States generally accepted accounting principles              
pursuant to Regulation S-K of the Securities and Exchange           
Commission.  Certain information and footnote disclosures           
normally included in audited financial statements                   
prepared in accordance with generally accepted accounting           
principles have been condensed or omitted.  Accordingly,            
these interim financial statements should be read in                
conjunction with the Company's financial statements and             
related notes as contained in Form SB-2 for the period              
from October 17, 2001 (inception) to December 31, 2001.             
In the opinion of management, the interim financial                 
statements reflect all adjustments, including normal                
recurring adjustments, necessary for fair presentation of           
the interim periods presented.  The results of operations           
for the three months ended March 31, 2002 are not                   
necessarily indicative of results of operations to be               
expected for the full year.                                         

Use of Estimates                                                    
----------------                                                    
The preparation of financial statements in conformity with          
generally accepted accounting principles requires                   
management to make estimates and assumptions that affect            
the reported amounts of assets and liabilities and                  
disclosure of contingent assets and liabilities at the              
date of the financial statements and the reported amounts           
of revenue and expenses during the reporting period.                
Actual results could differ from those estimates.                   

Cash and Cash Equivalents                                           
-------------------------                                           
The Company considers all highly liquid investments                 
purchased with original maturities of three months or               
less to be cash equivalents.                                        

Software Development Costs                                          
--------------------------                                          
Software development costs are charged to expense as                
incurred until technological feasibility has been                   
established for the product.  Software acquired and                 
development costs incurred after technological feasibility          
has been established are capitalized and amortized on a             
straight-line basis over a period of three years,                   
commencing with product release.                                    

Deferred Offering Costs                                             
-----------------------                                             
Costs incurred for a proposed or actual offering are                
deferred and charged against the proceeds of the offering.          
Management salaries and other general and administrative            
expenses are not allocated as costs of the offering and             
are expensed when incurred.  The offering costs are                 
expensed immediately upon an aborted offering.                      

- 6 -               

35                

FENTON GRAHAM MARKETING, INC.               
(A Development Stage Company)               
NOTES TO FINANCIAL STATEMENTS               
MARCH 31, 2002 (UNAUDITED) AND DECEMBER 31, 2001                

NOTE 1  -  DESCRIPTION  OF BUSINESS AND SUMMARY OF  SIGNIFICANT                 
ACCOUNTING POLICIES (Continued)                           

Research and Development                                            
------------------------                                            
Costs incurred in research and development activities are           
charged to expense as incurred.                                     

Income Taxes                                                        
------------                                                        
Income taxes are provided for based on the liability                
method of accounting pursuant to SFAS No. 109,                      
"Accounting for Income Taxes."  Deferred income taxes,              
if any, are recorded to reflect the tax consequences on             
future years of differences between the tax bases of                
assets and liabilities and their financial reporting                
amounts at each year-end.                                           

Earnings Per Share                                                  
------------------                                                  
The Company calculates earnings per share in accordance             
with SFAS No. 128, "Earnings Per Share," which requires             
presentation of basic earnings per share ("BEPS") and               
diluted earnings per share ("DEPS").  The computation of            
BEPS is computed by dividing income available to common             
stockholders by the weighted average number of                      
outstanding common shares during the period.  DEPS gives            
effect to all dilutive potential common shares                      
outstanding during the period.  The computation of DEPS             
does not assume conversion, exercise or contingent                  
exercise of securities that would have an antidilutive              
effect on earnings.   As of December 31, 2001, the                  
Company had no securities that would effect loss per                
share if they were to be dilutive.                                  

Comprehensive Income                                                
--------------------                                                
SFAS No. 130, "Reporting Comprehensive Income,"                     
establishes standards for the reporting and display of              
comprehensive income and its components in the financial            
statements.  The Company had no items of other                      
comprehensive income and therefore has not presented a              
statement of comprehensive income.                                  

NOTE 2 - INCOME TAXES                                                           

The components of the provision for income taxes for the            
period from October 17, 2001 (inception) to December 31,            
2001 are as follows:                                                

Current Tax Expense                                                 
U.S. Federal                       $     -                
State and Local                          -                
                   -------
Total Current                                 -                     
                   -------

Deferred Tax Expense                                                
U.S. Federal                             -                
State and Local                          -                
                   -------
Total Deferred                                -                     
                   -------

Total Tax Provision (Benefit) from                                  
Continuing Operations                  $     -                    
                   =======

- 7 -               

36                

FENTON GRAHAM MARKETING, INC.               
(A Development Stage Company)               
NOTES TO FINANCIAL STATEMENTS               
MARCH 31, 2002 (UNAUDITED) AND DECEMBER 31, 2001                

NOTE 2 - INCOME TAXES (Continued)                                               

The reconciliation of the effective income tax rate to the          
Federal statutory rate is as follows:                               

Federal Income Tax Rate                            34.0%            
Effect of Valuation Allowance                   ( 34.0)%            
                                    --------
Effective Income Tax Rate                           0.0%            
                                    ========

At December 31, 2001, the Company had a net carryforward            
loss of $6,013.  Because of the current uncertainty of              
realizing the benefits of the tax carryforward, a                   
valuation allowance equal to the tax benefits for deferred          
taxes has been established.  The full realization of the            
tax benefit associated with the carryforward depends                
predominantly upon the Company's ability to generate                
taxable income during the carryforward period.                      

Deferred tax assets and liabilities reflect the net tax             
effect of temporary differences between the carrying                
amount of assets and liabilities for financial reporting            
purposes and amounts used for income tax purposes.                  
Significant components of the Company's deferred tax                
assets and liabilities as of December 31, 2001 are as               
follows:                                                            

Deferred Tax Assets                                                 
Loss Carryforwards                     $    2,044                 

Less:  Valuation Allowance                ( 2,044)                
                       -----------
Net Deferred Tax Assets                $        -                 
                       ===========

Net operating loss carryforwards expire in 2021.                    

NOTE 3 - COMMON STOCK                                                           

In October 2001, the Company issued 5,000,000 shares of             
common stock for services valued at $5,000.                         

In December 2001, the Company sold 385,000 shares of                
common stock at $0.10 per share for gross proceeds of               
$38,500.                                                            

In December 2001, an additional 295,000 shares of common            
stock were subscribed at $0.10 per share for a total of             
$29,500.  The shares of common stock were issued during             
January 2002.  All the subscription receivables were                
collected in January 2002.                                          

In January 2002, the Company sold an additional 320,000             
shares of common stock at $0.10 per share for gross                 
proceeds of $32,000.                                                

- 8 -               

37                

FENTON GRAHAM MARKETING, INC.               
(A Development Stage Company)               
NOTES TO FINANCIAL STATEMENTS               
MARCH 31, 2002 (UNAUDITED) AND DECEMBER 31, 2001                

NOTE 4 - RELATED PARTY TRANSACTIONS                                             

The officers/directors of the Company provide office and            
other services without charge.  Such costs are immaterial           
to the financial statements and, accordingly, have not              
been reflected therein.  These individuals are involved in          
other business activities and may, in the future, become            
involved in other business opportunities.                           

The Company is obligated to a stockholder in the amount of          
$1,100 for funds advanced for working capital.  The funds           
were used to pay the cost of the sale of common stock               
described in  Note 2.  The advances bear no interest and            
are due upon demand.  The Company paid the loan on April 8,         
2002.                                                               

NOTE 5 - SUBSEQUENT EVENTS                                                      

In January 2002, the Company sold an additional 320,000             
shares of common stock at $0.10 per share for gross                 
proceeds of $32,000.                                                

During January 2002, the Company collected the                      
subscription receivable of $29,500.  The 295,000 shares of          
common stock were issued during the month.                          

On February 1, 2002, the Company entered into a lease               
agreement to house its principal administrative and                 
corporate office.  The lease term is on a month-to-month            
basis at a cost of $1,431 per month.                                

On July 1, 2002, the Company entered into a lease                   
agreement to house its computer hardware.  The lease term           
is on a month-to-month basis at a cost of $200 per month.           

On July 5, 2002, the President and Director of the Company          
resigned and tendered back the shares issued.  The shares           
were canceled and reissued to the remaining founder as              
consideration for the continued service to the Company.             

On July 12, 2002, the Company entered into an agreement to          
purchase the software technology that the Company needs to          
implement its plan of operations.  The acquired software            
was purchased for $20,000.                                          

- 9 -               

38                

WHERE YOU CAN FIND MORE INFORMATION               

We have filed a registration statement on Form SB-2 with the                    
Securities and Exchange Commission in connection with this                      
offering. This prospectus does not contain all of the information               
set forth in the registration statement, as permitted by the                    
Rules and Regulations of the Securities and Exchange Commission.                
Whenever reference is made in this prospectus to any contract or                
other document of ours, the reference may not be complete and you               
should refer to the exhibits that are part of the registration                  
statement for a copy of the contract or document.                               

We also file annual, quarterly and current reports and other                    
information with the Securities and Exchange Commission. You may                
read and copy any report or document we file, and the                           
registration statement, including the exhibits, may be inspected                
at the Securities and Exchange Commission's public reference room               
located at 450 Fifth Street, N.W., Washington, D.C. 20549. Please               
call the Securities and Exchange Commission at 1-800-SEC-0330 for               
further information on the public reference rooms. Our Securities               
and Exchange Commission filings are also available to the public                
from the SEC's website at: http://www.sec.gov.                                  

EXPERTS               

The audited financial statements of the Company as of December                  
31, 2001 were audited by Merdinger, Fruchter, Rosen & Corso,                    
P.C., an independent public accounting firm with offices in New                 
York, New York and Los Angeles, California.  Their report                       
regarding the Company's financial statements is included in this                
prospectus in reliance upon their authority as experts in                       
accounting, auditing, and giving such reports.                                  

LEGAL MATTERS               

The law offices of Chapman & Flanagan, Ltd., Las Vegas, Nevada,                 
has acted as the Company's legal counsel regarding the validity                 
of the securities being offered by this prospectus.                             

39                

OUTSIDE BACK COVER PAGE OF PROSPECTUS               

Until _____________, 20___, all dealers that effect transactions                
in these securities, whether or not participating in the                        
offering, may be required to deliver a prospectus.  This is in                  
addition to the dealers' obligation to deliver a prospectus when                
acting as underwriters and with respect to their unsold                         
allotments or subscriptions.                                                    

No person is authorized to give any information or to make any                  
representation other than those contained in this prospectus, and               
if given or made, such information or representation must not be                
relied upon as having been authorized.  This prospectus does                    
constitute an offer to sell or a solicitation of an offer to buy                
any securities other than the shares offered by this prospectus                 
or an offer to sell or a solicitation of an offer to buy the                    
shares in any jurisdiction to any person to whom it is unlawful                 
to make such an offer or solicitation in such jurisdiction.                     

-------------------------------               

Up to 5,000,000 Shares                

Fenton Graham Marketing, Inc.               

Common Stock                

-------------------------------               

Prospectus                

-------------------------------               

Fenton Graham Marketing, Inc.               
13215 Verde River Drive, Unit 1               
Fountain Hills, AZ 85268                
(480) 836-8720                

40                

[ALTERNATIVE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

Prospectus                                                                      

1,000,000 SHARES OF COMMON STOCK                

OF                

FENTON GRAHAM MARKETING, INC.               

We are registering 1,000,000 shares of our common stock for sale                
by certain selling security holders. These shareholders are                     
referred to throughout this prospectus as "selling security                     
holders."                                                                       

These selling shareholders will sell their shares at a price of                 
$0.02 per share until our shares are quoted on the OTC Bulletin                 
Board and thereafter at prevailing market prices, or at privately               
negotiated prices.  We will not receive any of the proceeds from                
the sales of shares by the selling security holders.                            

No public trading market for our common stock exists.                           

OUR COMMON STOCK BEING OFFERED BY THIS PROSPECTUS INVOLVES A HIGH               
DEGREE OF RISK. YOU SHOULD READ THE "RISK FACTORS" SECTION                      
BEGINNING ON PAGE 5 BEFORE YOU DECIDE TO PURCHASE ANY COMMON                    
STOCK.                                                                          

Neither the Securities and Exchange Commission nor any state                    
commission has approved or disapproved of these securities or                   
passed upon the adequacy or accuracy of this prospectus. Nor have               
they made, nor will they make, any determination as to whether                  
anyone should buy these securities. Any representation to the                   
contrary is a criminal offense.                                                 

The date of this Prospectus is ________, 2002               

41                  

[ALTERNATE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

THE OFFERING                

Shares offered by Selling Security Holders.... 1,000,000 shares of              
                           common stock.

Plan of distribution.......................... The offering of our              
                                    shares of common stock
                                  are being made by 18
                                    shareholders of Fenton
                                    Graham who may wish to
                                sell their shares.
                           These selling
                                     shareholders will offer
                                    their stock at a price
                                      of $0.02 per share until
                                      our shares are quoted on
                                    the OTC Bulletin Board
                               and thereafter at
                               prevailing market
                                     prices, or at privately
                                negotiated prices.

Use of proceeds............................... Fenton Graham will not           
                                  receive any proceeds
                                     from the sale of shares
                                  owned by the selling
                               security holders.

CONCURRENT OFFERING               

The registration statement of which this prospectus is a part                   
also includes a prospectus with respect to the offering by Fenton               
Graham for cash of 5,000,000 shares of Fenton Graham common                     
stock. This distribution may have a material adverse effect on                  
the market price of the common stock offered by the selling                     
security holders.                                                               

Shares offered by Fenton Graham............... 5,000,000 shares of              
                           common stock.

Shares to be sold by Selling Security Holders. 1,000,000 shares of              
                           common stock.

Plan of distribution.......................... Fenton Graham will offer         
                                and sell 5,000,000
                                  shares for cash at a
                                price of $0.02 per
                    share.

Use of proceeds............................... Fenton Graham will               
                                     receive the proceeds to
                                      be derived from the sale
                             of an aggregate
                                     5,000,000 shares of its
                           common stock.

42                

[ALTERNATE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

USE OF PROCEEDS               

This prospectus is part of a registration statement that permits                
the shareholders of Fenton Graham who are identified in this                    
prospectus to sell their shares of Fenton Graham's common stock                 
in the open market or in privately negotiated transactions. We                  
will not receive any of the proceeds from the sale of the shares                
by the selling security holders but have agreed to bear all                     
expenses for registration of the shares under federal securities                
laws.  All proceeds from the sale of the common stock will be                   
paid to the selling security holders.                                           

43                  

[ALTERNATE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

DETERMINATION OF OFFERING PRICE               

The selling security holders will offer and sell the shares at                  
$0.02 per share until our shares are qutoed on the OTC Bulletin                 
Board and thereafter at prevailing market prices or privately                   
negotiated prices.  The price of the offered shares is based on                 
our management's belief about the value of our business plan.                   
Our common stock is presently not traded on any market or                       
securities exchange.                                                            

44                  

[ALTERNATE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

SELLING SECURITY HOLDERS                

The following table sets forth the name of the selling security                 
holders, the number of shares of common stock beneficially owned                
by each selling security holder as of May 7, 2002, the number of                
shares that each may offer, and the number of shares of common                  
stock beneficially owned by each selling security holder upon                   
completion of the offering, assuming all of the shares are sold.                

                                                                [Download Table]
                                                                                 
                                Before the Offering         After the Offering   
                            --------------------------  -------------------------
                               Shares       Percentage     Shares      Percentage
Name of Selling             Beneficially    of Common   Beneficially   of Common 
Security Holder                Owned          Stock         Owned        Stock   
-------------------------   ------------    ----------  ------------   ----------

Risque, LLC (1)                250,000         4.2%           0            *     
James Wexler (2)               250,000         4.2%           0            *     
Regina Wexler (2)               15,000          *             0            *     
Merial H. Schine                15,000          *             0            *     
Deborah Wexler                  15,000          *             0            *     
Tara Romeo (3)                  30,000          *             0            *     
Daniel Wexler (2)(3)            30,000          *             0            *     
Dennis Pannulo (4)              30,000          *             0            *     
Sandra Downing (4)              30,000          *             0            *     
Dennis Reissig (5)              15,000          *             0            *     
Sherri L. Reissig (5)           15,000          *             0            *     
Constance J. Fournier (6)(7)    30,000          *             0            *     
Francis O. Fournier (6)         30,000          *             0            *     
Mark Griggs (7)                250,000         4.2            0            *     
Mary G. Fuoco                   15,000          *             0            *     
Julie Norrod                    15,000          *             0            *     
Naomi L. McKee                  15,000          *             0            *     
Paul DeRosa                     40,000          *             0            *     

-------------------                                                             

*  Denotes less than 1% of the issued and outstanding shares of               
common stock.                                                           

(1) Cinda Hey is the principal of Risque LLC.  Neither Ms. Hey                  
nor Risque LLC is deemed to be an affiliate of Fenton Graham.  No               
other relationship exists between Ms. Hey, Risque LLC and any of                
the selling security holders.                                                   

(2) Regina Wexler is the mother of James Wexler and Daniel                      
Wexler.  Both James and Daniel Wexler are adults.  Each disclaim                
beneficial ownership of each other's shares.                                    

(3) Tara Romero and Daniel Wexler are husband and wife.  Tara                   
Romero directly owns 15,000 shares and Daniel Wexler directly                   
owns 15,000 shares.  Therefore, Ms. Romero and Mr. Wexler are                   
deemed to beneficially own each other's shares.                                 

45          

(4) Sandra Downing and Dennis Pannullo are husband and wife.                    
Sandra Downing directly owns 15,000 shares and Dennis Pannullo                  
directly owns 15,000 shares.  Therefore, Ms. Downing and Mr.                    
Pannullo are deemed to beneficially own each other's shares.                    

(5) Sherri L. Reissig and Dennis Reissig are husband and wife.                  
Sherri L. Reissig directly owns 15,000 shares and Dennis Reissig                
directly owns 15,000 shares.  Therefore, Mr. and Mrs. Reissig are               
deemed to beneficially own each other's shares.                                 

(6) Constance Fournier and Francis Fournier are husband and                     
wife.  Constance Fournier directly owns 15,000 shares and Francis               
Fournier directly owns 15,000 shares.  Therefore, Mr. and Mrs.                  
Fournier are deemed to beneficially own each other's shares.                    

(7) Constance Fournier is the mother of Mark Griggs.  Mark                      
Griggs is an adult.  Each disclaim beneficial ownership of each                 
other's shares.                                                                 

46                

[ALTERNATE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

PLAN OF DISTRIBUTION                

We are registering the shares on behalf of the selling security                 
holders. We will pay all costs, expenses and fees in connection                 
with the registration of the shares offered by this prospectus.                 
Brokerage commissions and similar selling expenses, if any,                     
attributable to the sale of shares will be paid by the selling                  
security holders.                                                               

The selling security holders will offer their stock at a price of               
$0.02 per share until our shares are quoted on the OTC Bulletin                 
Board and thereafter at prevailing market prices, or at privately               
negotiated prices. Such transactions may or may not involve                     
brokers or dealers.                                                             

The selling security holders have advised us that they have not                 
entered into any agreements, understandings or arrangements with                
any underwriters or brokers-dealers regarding the sale of their                 
securities. In addition, there is not an underwriter or                         
coordinating broker acting in connection with the proposed sale                 
of shares by the selling security holders.                                      

The selling security holders may effect such transactions by                    
selling shares directly to purchasers or to or through broker-                  
dealers, which may act as agents or principals. Such broker-                    
dealers may receive compensation in the form of discounts,                      
concessions, or commissions from the selling security holders                   
and/or the purchasers of shares for whom such broker-dealers may                
act as agents or to whom they sell as principal, or both. The                   
compensation paid as to a particular broker-dealer might be in                  
excess of customary commissions.                                                

The selling security holders and any broker-dealers that act in                 
connection with the sale of shares might be deemed to be                        
underwriters within the meaning of Section 2(11) of the                         
Securities Act. Any commissions received by such broker-dealers                 
and any profit on the resale of the shares sold by them while                   
acting as principals might be deemed to be underwriting discounts               
or commissions under the Securities Act.                                        

Because selling security holders may be deemed to be underwriters               
within the meaning of Section 2(11) of the Securities Act, the                  
selling security holders will be subject to the prospectus                      
delivery requirements of the Securities Act.  We will make copies               
of this prospectus available to the selling stockholders and have               
informed them of the need for delivery of copies of this                        
prospectus to purchasers at or prior to the time of any sale of                 
the shares of common stock. The selling stockholders may                        
indemnify any broker-dealer that participates in transactions                   
involving the sale of the shares against certain liabilities,                   
including liabilities arising under the Securities Act of 1933.                 

Regulation M                                                                    
------------                                                                    

We have informed the selling security holders that Regulation M                 
promulgated under the Securities Exchange Act of 1934 may be                    
applicable to them with respect to any purchase or sale of our common           
stock. In general, Rule 102 under Regulation M prohibits any person             
connected with a distribution of our common stock from directly                 
or indirectly bidding for, or purchasing for any account in which it            
has a beneficial interest, any of the common stock or any right to              

47                    

purchase this stock, for a period of one business                               
day before and after completion of its participation in the                     
distribution.                                                                   

During any distribution period, Regulation M prohibits the                      
selling security holders and any other persons engaged in the                   
distribution from engaging in any stabilizing bid or purchasing                 
our common stock except for the purpose of preventing or                        
retarding a decline in the open market price of the common stock.               
None of these persons may effect any stabilizing transaction to                 
facilitate any offering at the market. As the selling security                  
holders will be reoffering and reselling our common stock at the                
market, Regulation M will prohibit them from effecting any                      
stabilizing transaction in contravention of Regulation M with                   
respect to this stock.                                                          

48                  

[ALTERNATIVE PAGE FOR SELLING SECURITY HOLDER PROSPECTUS]               

Outside back cover page of prospectus               

Until _____________, 20___, all dealers that effect transactions                
in these securities, whether or not participating in the                        
offering, may be required to deliver a prospectus.  This is in                  
addition to the dealers' obligation to deliver a prospectus when                
acting as underwriters and with respect to their unsold                         
allotments or subscriptions.                                                    

No person is authorized to give any information or to make any                  
representation other than those contained in this prospectus, and               
if given or made, such information or representation must not be                
relied upon as having been authorized.  This prospectus does                    
constitute an offer to sell or a solicitation of an offer to buy                
any securities other than the shares offered by this prospectus                 
or an offer to sell or a solicitation of an offer to buy the                    
shares in any jurisdiction to any person to whom it is unlawful                 
to make such an offer or solicitation in such jurisdiction.                     

-------------------------------               

Up to 1,000,000 Shares                

Fenton Graham Marketing, Inc.               

Common Stock                

-------------------------------               

Prospectus                

-------------------------------               

Fenton Graham Marketing, Inc.               
13215 Verde River Drive, Unit 1               
Fountain Hills, AZ 85268                
(480) 836-8720                

49                  

PART II               
Information Not Required in Prospectus                

Item 24.  Indemnification of Directors and Officers                             

The Company's Articles of Incorporation and By-laws provide that                
the Corporation shall indemnify any Directors, Officer, Employee                
or Agent of the Corporation who was or is 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, Officer, employee or agent of the Corporation or                
is or was serving at the request of the Corporation as a                        
Director, Officer, employee or agent of another corporation,                    
partnership, joint venture, trust 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 the case of conduct in his official capacity                 
with the Corporation, in a manner he reasonably believed to be in               
the best interest of the Corporation, or, in all other cases,                   
that his conduct was at least not opposed to the Corporation's                  
best interests. In the case of any criminal proceeding, he must                 
have 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, or itself, determine that the                     
individual did not meet the standard of conduct set forth in this               
paragraph.                                                                      

Fenton Graham currently maintains no director's and officer's                   
insurance policy or any liability insurance concerning its                      
officers and directors.                                                         

Item 25.   Other Expenses of Issuance and Distribution                          

The following expenses of the offering, except for the SEC fees,                
are estimated, all of which will be paid by the Registrant.                     

SEC Registration Fee.............. $    11                
Blue Sky Fees and Expenses........       0                
Legal Fees and Expenses...........   3,500                
Accountants' Fees and Expenses....   1,000                
Miscellaneous.....................     489                
                   -------
Total................. $ 5,000    

Item 26.   Recent Sales of Unregistered Securities                              

Between December 4, 2001 and January 11, 2002, Fenton Graham                    
conducted a private placement of its common stock in reliance                   
upon the exemptions from registration set forth in Section 4(2)                 
of the Securities Act of 1933, as amended and Rule 506 of                       
Regulation D promulgated thereunder.  None of the transactions                  
involved a distribution or public offering.  Each of the                        
investors were given the opportunity to ask questions and receive               
answers from the Company concerning the terms and conditions of                 
the offering or receive additional information prior to their                   
purchase.                                                                       

50                

Each purchaser executed and delivered to the Company checks                     
representing payment in full for the shares subscribed for along                
with an investment letter acknowledging that they:                              

-  were an accredited investor as that term is defined in Rule              
501 of Regulation D;                                                  

-  were aware that the securities had not been and may never be             
registered under federal or state securities laws;                    

-  acquired the securities for his/her/its own account for                  
investment purposes only, and not with a view toward reselling,       
transferring or distributing such securities except in accordance     
with applicable law;                                                  

-  understood that the securities would need to be indefinitely             
held unless registered or an exemption from registration applied      
to a proposed disposition; and                                        

-  were aware that the certificate representing the securities              
would bear a legend restricting its transfer.                         

The offers and sales were made by Mr. Ken Greble and Mr. J.P.                   
Schrage, our officers and directors at the time of the offering.                
Messrs. Greble and Schrage offered and sold a total of 1,000,000                
shares of our common stock for the offering price of $0.10 per                  
share to a total of 18 accredited investors for a total                         
consideration of $100,000 cash, as follows                                      

Date     Purchaser                    Shares                              
--------   ----------------             ------                                
12/04/01   Risque, LLC                 250,000                                
12/04/01   Regina Wexler                15,000                                
12/04/01   Merial H. Schine             15,000                                
12/04/01   Deborah Wexler               15,000                                
12/04/01   Tara Romeo                   15,000                                
12/04/01   Daniel Wexler                15,000                                
12/04/01   Sandra Downing               15,000                                
12/04/01   Dennis Reissig               15,000                                
12/04/01   Sherri L. Reissig            15,000                                
12/04/01   Dennis Pannullo              15,000                                
01/03/02   Constance J. Fournier        15,000                                
01/03/02   Francis O. Fournier          15,000                                
01/03/02   Mary G. Fuoco                15,000                                
01/03/02   Julie Norrod                 15,000                                
01/03/02   Naomi L. McKee               15,000                                
01/03/02   Mark Griggs                 250,000                                
01/03/02   James Wexler                250,000                                
01/11/02   Paul DeRosa                  40,000                                

51                  

Item 27.   Exhibits                                                             

Number   Description                                                  
------   -----------                                                  

3.1*     Amended and Restated Articles of Incorporation               

3.2*     By-laws                                                      

4.1*     Form of Common Stock Certificate                             

5.1      Opinion of Chapman & Flanagan, Ltd.                          

10.1     Assignment of the Redirector and WarRoom software            
to Fenton Graham by Quantum Leap Media, Inc.        
dated July 12, 2002.                                

23.1     Consent of Merdinger, Fruchter, Rosen & Company,             
P.C., Certified Public Accountants                  

23.2     Consent of Chapman & Flanagan, Ltd. (contained in            
Exhibit 5.1)                                        

99*      Subscription Agreement                                       

* Previously filed.                                                             

Item 28.   Undertakings                                                         

The undersigned registrant hereby undertakes to:                      

(a)  (1) File, during any period in which it offers or sells          
securities, a post-effective amendment to this              
registration statement to:                                  

         i. include any prospectus required by section 10(a)(3) of the
Securities Act;                               

  ii. reflect in the prospectus any facts or events which,
          individually or together, represent a fundamental change
       in the information in the registration statement; and
        notwithstanding the forgoing, any increase or decrease
            in volume of securities offered, if the total dollar value
       of securities offered would not exceed that which was
            registered,  and any deviation from the low or high end of
              the estimated maximum offering range may be reflected in the
          form of prospectus filed with the Commission pursuant to
      Rule 424(b) if, in the aggregate, the changes in the
         volume and price represent no more than a 20% change in
       the maximum aggregate offering price set forth in the
          "Calculation of Registration Fee" table in the effective
registration statement.                       

      iii. include any additional or changed material information on
the plan of distribution.                     

  (2)  For determining liability under the Securities Act, treat
    each post-effective amendment as a new registration statement of
 the securities offered, and the offering of the securities at
that time to be the initial bona fide offering.             

52  

    (3)  File a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the  
offering.                                                   

(b)  Provide to the underwriter at the closing specified in           
the underwriting agreement certificates in such                       
denominations and registered in such names as required by             
the underwriter to permit prompt delivery to each purchaser.          

(c)  Insofar as indemnification for liabilities arising               
under the Securities Act of 1933 (the "Act") may be                   
permitted to directors, officers and controlling persons of           
the small business issuer pursuant to the foregoing                   
provisions, or otherwise, the small business issuer has been          
advised that in the opinion of the Securities and Exchange            
Commission such indemnification is against public policy as           
expressed in the Act and is, therefore, unenforceable.  In            
the event that a claim for indemnification against such               
liabilities, other than the payment by the small business             
issuer of expenses incurred or paid by a director, officer            
or controlling person of the small business issuer in the             
successful defense of any action, suit or proceeding, is              
asserted by such director, officer or controlling person in           
connection with the securities being registered, the small            
business issuer will, unless in the opinion of its counsel            
the matter has been settled by controlling precedent, submit          
to a court of appropriate jurisdiction the question whether           
such indemnification by it is against public policy as                
expressed in the Securities Act and will be governed by the           
final adjudication of such issue.                                     

53          

SIGNATURES                

In accordance with the requirements of the Securities Act of                    
1933, the registrant certifies that it has reasonable grounds to                
believe that it meets all of the requirements for filing on Form                
SB-2 and authorized this registration statement to be signed on                 
its behalf by the undersigned, thereunto duly authorize, in the                 
City of Fountain Hills, State of Arizona, on July 22, 2002.                     

         FENTON GRAHAM MARKETING, INC.

By:/s/ J.P. Schrage,
         President/Secretary/Treasurer

Pursuant to the requirements of the Securities Act of 1933, this                
registration statement has been signed by the following persons                 
in the capacities and on the dates indicated.                                   

Signature            Title                        Date                          
----------------     ------------------------     -------------                 

/s/ J.P. Schrage     Chief Executive Officer,     July 22, 2002                 
Principal Financial and               
Accounting Officer, and               
Director                              

54              

EXHIBIT INDEX               

Number  Description                                                Page       
------  -----------                                                ----       

3.1    Amended and Restated Articles of Incorporation               *       

3.2    Bylaws                                                       *       

4.1    Form of Common Stock Certificate                             *       

5.1    Opinion of Chapman & Flanagan, Ltd.                         56       

10.1   Assignment of the Redirector and WarRoom software                    
to Fenton Graham by Quantum Leap Media, Inc.                  
dated July 12, 2002                                         57

23.1   Consent of Merdinger, Fruchter, Rosen & Company, P.C.,               
Certified Public Accountants                                59

23.2   Consent of Chapman & Flanagan, Ltd. (contained in                    
Exhibit 5.1)                                                56

99    Subscription Agreement                                       *      

* Previously filed.                                                             

55        

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘SB-2/A’ Filing		Date		Other Filings
		3/1/03		None on these Dates
Filed as of:		7/24/02
Filed on:		7/23/02
		7/22/02
		7/15/02
		7/12/02
		7/5/02
		7/1/02
		5/7/02
		4/8/02
		3/31/02
		2/1/02
		1/31/02
		1/11/02
		12/31/01
		12/4/01
		11/28/01
		10/17/01
		10/12/01
				List all Filings