As filed with the Securities and Exchange Commission on October 30, 2000
Registration No.__________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
MyTurn.com, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 11-3344575
(State or Other Jurisdiction (I.R.S. Employer Identification
of Incorporation) Number)
1080 Marina Village Parkway
Alameda, California 94501
Telephone: (510) 263-4800
Telecopier: (510) 263-4999
(Address, Including Zip Code, and Telephone Number, Including Area Code,
of Registrant's Principal Executive Offices)
Michael Fuchs
Chief Executive Officer
MyTurn.com, Inc.
1080 Marina Village Parkway
Alameda, California 94501
Telephone: (510) 263-4800
Telecopier: (510) 263-4999
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
Copies of all communications and notices to:
Gavin C. Grusd, Esq.
Certilman Balin Adler & Hyman, LLP
90 Merrick Avenue
East Meadow, New York 11554
Telephone: (516) 296-7000
Telecopier: (516) 296-7111
<PAGE>
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration
Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]
If any of the securities being registered on this form are to be
offered on a delayed or continuous basis pursuant to Rule 415 of the
Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box. [x]
If this form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, 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 delivery of the Prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Maximum Proposed Maximum
Amount to be Offering Price Aggregate Offering Amount of
Title of Each Class of Securities to be Registered Registered Per Share (3) Price (3) Registration Fee
------------------------------------------------ ------------------------------------------ ---------------------- -----------------
<S> <C> <C> <C> <C>
Common Stock, registered for the benefit of 9,309,646(1)(2) $4.3125 $40,147,848 $10,600.00
certain Selling Stockholders
Total Registration Fee: $10,600.00
</TABLE>
<PAGE>
(1) Includes the resale of 7,742,495 shares of MyTurn.com's common
stock which are issuable upon exercise of warrants issued to
certain selling security holders.
(2) Pursuant to Rule 416 promulgated under the Securities Act of
1933, as amended (the "Securities Act"), the number of shares
of Common Stock to be registered for resale hereunder also
includes an indeterminate number of shares which may become
issuable upon exercise of, or otherwise with respect to, the
warrants to prevent dilution resulting from stock splits,
stock dividends or similar transactions.
(3) Estimated solely for the purpose of calculating the amount of
the registration fee pursuant to Rule 457(c).
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 or until this Registration Statement shall become effective
on such date as the Securities and Exchange Commission, acting pursuant to said
Section 8(a), may determine.
<PAGE>
Subject to completion dated October 30, 2000
The information in this Prospectus is not complete and may be changed. We
may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This Prospectus is not an offer
to sell these securities and is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.
PROSPECTUS
----------------
MyTurn.com, Inc.
9,309,646 SHARES OF COMMON STOCK
The shares of common stock A purchase of these securities
offered by this Prospectus involves a high degree of risk.
are being sold by stockholders See "Risk Factors," beginning
of MyTurn.com, Inc. on page 4.
The Common Stock of MyTurn.com, Inc. is traded
on the Nasdaq SmallCap Market under the symbol "MYTN."
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.
1080 Marina Village Parkway
Alameda, California 94501
Telephone: (510) 263-4800
Telecopier: (510) 263-4999
__________, 2000
<PAGE>
TABLE OF CONTENTS
Pages
Incorporation by Reference........................................2
The Company.......................................................4
Risk Factors......................................................4
Forward Looking Statements.......................................20
Selling Stockholders.............................................20
Plan of Distribution.............................................34
Legal Matters....................................................35
Experts..........................................................35
Additional Information...........................................36
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The documents listed below have been filed by MyTurn.com with the
Securities and Exchange Commission (the "SEC") under the Securities Exchange Act
of 1934, as amended (the "Exchange Act") and are incorporated herein by
reference:
(a) Current Report on Form 8-K, as amended, for an event dated
December 22, 1999.
(b) Annual Report on Form 10-KSB for the year ended December 31,
1999.
(c) Quarterly Report on Form 10-QSB for the period ended March 31,
2000.
(d) Current Report on Form 8-K for an event dated June 5, 2000.
(e) Current Report on Form 8-K for an event dated June 28, 2000.
(f) Quarterly Report on From 10-QSB for the period ended June 30,
2000.
(g) The description of the Registrant's shares of Common Stock,
par value $.01 per share, contained in the Registrant's
Registration Statement on Form 8-A (File No. 000-22611), which
was declared effective by the SEC on June 10, 1997.
All documents filed by MyTurn.com pursuant to Sections 13(a), 13(c), 14 or
15(d) of the 1934 Act after the date of this Prospectus and prior to the
termination of the offering of MyTurn.com's shares of Common Stock offered
hereby shall be deemed to be incorporated by reference into this Prospectus and
to be a part hereof from their respective dates of filing.
MyTurn.com will provide without charge to each person to whom a copy of
this Prospectus is delivered, upon the written or oral request of any such
person, a copy of any or all of the documents referred to above which have been
incorporated into this Prospectus by reference (other than exhibits to such
documents). Requests for such copies should be directed to the Secretary, 1080
Marina Village Parkway, Alameda, California 94501(telephone number: (510)
263-4800).
This Prospectus was created after all of the documents listed in items (a)
through (c) above were filed with the SEC. Therefore, there may be certain
conflicts between the information contained in this Prospectus and information
contained in those other documents. If there are any inconsistencies, then the
statements in those earlier documents should be read as if they agree with the
statements in this Prospectus.
MyTurn.com files reports, proxy and information statements and other
information with the SEC. Such reports, statements and other information filed
by MyTurn.com with the SEC can be inspected and copied at prescribed rates at
the Public Reference Room maintained by the SEC at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the following
2
<PAGE>
Regional Offices of the SEC: 7 World Trade Center, Suite 1300, New York, New
York 10048; and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511.
3
<PAGE>
THE COMPANY
MyTurn.com is a provider of easy-to-use Internet-driven related computing
products and services targeted at providing a complete solution to those without
computers and access to the Internet. MyTurn.com currently markets and sells an
affordable easy-to-use personal computer system, known as the GlobalPC,
targeting the first-time user market. The GlobalPC is based on the GEOS
operating system which MyTurn.com licenses from Geoworks Corporation. MyTurn.com
has made or acquired significant improvements to this operating system. The
fully integrated software application suite includes a complete operating
system, Internet browser, e- mail package and office suite of software
applications, such as word processing, spreadsheet, database and graphics
programs.
MyTurn.com was incorporated under the name Coastal Computer Systems, Inc.
in New York on March 31, 1983 and was reincorporated in Delaware under the name
Compu-DAWN, Inc. on October 18, 1996. The name was changed to MyTurn.com, Inc.
on January 21, 2000.
MyTurn.com's executive offices are located at 1080 Marina Village Parkway,
Alameda, California 94501 and its telephone number is (510) 263-4800.
MyTurn.com's website is http://www.MyTurn.com. Information contained on
MyTurn.com's website is not part of this Prospectus.
RISK FACTORS
An investment by you in the shares of Common Stock offered by this
Prospectus is speculative and involves a high degree of risk. You should only
acquire these securities if you can afford to lose your entire investment.
Before making an investment, you should carefully consider the following risks
and speculative factors, as well as the other information contained in this
Prospectus. As discussed below, this Prospectus contains forward-looking
statements that involve risks and uncertainties. The actual results of
MyTurn.com's operations could be significantly different from the information
contained in those forward-looking statements. Those differences could result
from the risk factors discussed immediately below, as well as factors discussed
in other places in this Prospectus.
In this "Risk Factors" section, "we," "our" and "ours" refer to MyTurn.com,
and "you," "your" and "yours" refer to an acquiror of the shares offered by this
Prospectus.
We may not be able to sustain or grow our business because of our lack of
significant revenues and recent and anticipated continuing losses.
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<PAGE>
Period Ended Revenues Net Loss
------------ -------- --------
December 31, 1998 (Year) $336,955 $ 2,783,552
December 31, 1999 (Year) 233,660 13,383,485
June 30, 2000 (six months) 84,310 111,147,409
The table above sets out our revenues and net losses for the periods ended
on the dates indicated in the first column.
The increase in losses for the twelve months ended December 31, 1999 is
primarily the result of the increase in loss from discontinued operations and an
increase of approximately $7,000,000 in costs and expenses from 1998 to 1999.
The net loss amount for 1999 includes a $6,792,222 loss from the discontinued
operations of our subsidiary e.TV Commerce, Inc. and our public safety software
business division, and an operating loss of $7,128,995 from continuing
operations.
For the six months ended June 30, 2000, MyTurn.com incurred a net loss of
$111,147,407 as compared to a net loss of $6,455,547 for the same period in
1999. This increase in loss is primarily the result of the increase in costs and
expenses resulting from the non-cash earnings charges discussed in the following
paragraphs.
On January 20, 2000, our shareholders approved an amendment to the 1996
Stock Option Plan which increased to 10,000,000 the number of options available
to be granted. MyTurn.com previously had granted options in excess of those
authorized to be granted prior to the shareholder action; therefore, MyTurn.com
is required to recognize a non-cash compensation charge measured by the
difference between:
o the exercise price of the excess 6,130,583 options granted, and
o the market price of our shares on January 20, 2000.
For the six months ended June 30, 2000, costs and expenses increased to
$111,231,719, primarily due to the following:
o a non-cash compensation charge of $53,085,256 resulting from
the grant of options to employees, during 1999, in excess of
the options available under MyTurn.com's 1996 Stock Option
Plan.
o a non-cash compensation charge of $16,708,763 resulting from
the grant of options to employees in January of 2000, having
an exercise price below the fair market value.
5
<PAGE>
o a non-cash compensation charge of $13,158,500
resulting from the issuance of warrants to the
Chairman of the Board/Chief Executive Officer.
o a non-cash compensation charge of $5,412,500
resulting from the issue of warrants to certain
directors with an exercise price below the fair
market value.
o a non-cash compensation charge of $4,625,000
resulting from the acceleration of the vesting of
warrants issued to the Chairman of the Board/Chief
Executive Officer during the first quarter of 2000.
o a non-cash compensation charges of $7,113,931 resulting from
the grant of options and the issuance of warrants to non-
employees.
o a non-cash compensation charge of $1,561,359 resulting from
the issuance of shares to non-employees.
o an increase in depreciation and amortization of $2,227,305
resulting from amortization of
o goodwill related to the acquisition in December 1999
of assets of Global PC, Inc. of $1,804,138,
o licensing fees of $190,198,
o web-site development and domain name costs of
$158,412, and
o depreciation of fixed assets of $74,557.
o an increase in research and development costs of $827,289
related to the development of software to be used on the
GlobalPC.
o an increase in general and administrative costs by
$5,739,502 which is primarily the result of the
discontinuation of operations in 1999. General and
administrative expenses for the six months ended June
30, 1999 were $701,491. All other general and
administrative costs in 1999 were associated with the
discontinued operations and are with the reflected
loss from discontinued operations of $5,970,091.
These non-cash earnings charges will not impact MyTurn.com's cash flows.
We bought certain assets of Global PC, Inc. in December 1999 which we use
to manufacture and sell our product known as the GlobalPC. We are placing
material reliance on the successful marketing and sale of the GlobalPC to
generate our revenues in the future. We cannot assure you that we will be able
to develop a market for this product, or if we do that the market will grow or
even be sustained.
6
<PAGE>
We believe that we will be unable to achieve enough revenues to offset
operating costs for the foreseeable future; therefore, we anticipate that
operating losses will continue for at least the next twelve months. We cannot
predict how long these operating losses will continue or what impact they will
have on our financial condition and results of operations. We cannot assure you
that our products and services will be able to compete successfully in the
marketplace or that they will generate significant revenue; nor can we assure
you that our business will be able to operate profitably.
MyTurn.com needs more capital to grow and even to sustain current
operations. MyTurn.com's cash requirements have been and will continue to be
significant. We currently anticipate that our available cash resources and funds
from operations will be sufficient to meet our presently anticipated and
projected working capital and capital expenditure requirements for at least 60
days. We expect we will need to raise additional funds through private debt or
equity financings within 60 days in order to continue to support current
operations and develop our business plan. Since April 2000 we have primarily
relied on investments and advances from our Chairman of the Board/Chief
Executive Officer for our cash needs. If we do not receive further funding from
the Chairman/Chief Executive Officer, and if we do not develop our business
plan, we would have enough cash for about 60 days at the current level of
operation. If we raise additional funds by issuing equity securities, the
percentage ownership of our stockholders at that time will be reduced. Those
equity securities may have rights, preferences or privileges senior to those of
the holders of our shares. We cannot assure that additional financing will be
available on terms favorable to us, or at all. If adequate funds are not
available or are not available on acceptable terms, MyTurn.com may not be able
to
o fund then-existing operations;
o take advantage of new opportunities;
o develop new or enhanced services and related products;
o continue to develop its business plan;
o otherwise respond to competitive pressures; and
o sustain its current operations.
As a result, our business, operating results and financial condition could be
materially adversely affected. Additionally, we may be forced to scale back
operations.
We have a limited operating history which does not indicate we will be
successful. We were incorporated in New York on March 31, 1983 and
reincorporated in Delaware on October 18, 1996. We changed our name from
Compu-DAWN, Inc. to MyTurn.com, Inc. on January 21, 2000.
7
<PAGE>
Until January 1999, we were engaged primarily in the business of designing,
developing, licensing, installing and servicing computer application software
systems for law enforcement and public safety agencies. In January 1999 we
commenced the business of selling Internet, e- commerce, and telecommunications
products and services through a multi-level network marketing system of
independent representatives through our subsidiary e.TV. In July, 1999 we sold
the public safety software business, closed our network marketing sales
activities to sell our products, and assigned our rights to receive long
distance revenues to an unaffiliated third party.
We are currently receiving income from sales of the GlobalPC, which we
brought to the market in the summer of 2000, and Internet access service sales
to certain GlobalPC users. We are currently selling our GlobalPC in a limited
market of four cities. We expect, but cannot assure, that we will expand into
more markets nationally and internationally by the end of 2000. However, we have
limited history with respect to the development and sale of the GlobalPC on
which to base an evaluation of our business and prospects.
Our prospects in the business of developing and selling the GlobalPC must
be considered in light of the risks, uncertainties, expenses and difficulties
frequently encountered by companies in their early stages of a new line of
business, particularly companies in new and rapidly evolving markets such as the
development and sale of high technology and telecommunications products and
services, and online e-commerce. To address these risks and uncertainties, we
must, among other things
o establish and enhance the brand-name recognition for the
GlobalPC;
o establish and maintain active business relationships with mass
merchandise retailers and obtain significant orders from them
regularly;
o establish and maintain licensing relationships domestically
and internationally with users of our technology;
o implement and execute our business and marketing strategy
successfully;
o continue to develop and upgrade our technology and
information-processing systems;
o provide superior customer service;
o respond to competitive developments; and
o raise adequate capital to fund manufacture of the GlobalPC, to
fund marketing activities and to hire employees.
There can be no assurance that we will be successful in accomplishing all of
these things, and the failure to do so could have a material adverse effect on
our business, results of operations and financial condition.
8
<PAGE>
We cannot assume we will be profitable. We believe that our growth and our
achieving profitability will depend in large part on our ability to
o gain vendor and user acceptance of the GlobalPC;
o obtain significant orders from mass merchandise retailers for
the GlobalPC;
o extend our sales into other channels such as direct marketing
through infomercials and to direct sales organizations;
o establish a market for the GlobalPC and then increase our
market share;
o provide our customers with superior Internet services and
on-line commerce experiences through the use of the GlobalPC;
o gain wider user acceptance of our computer operating
technology;
o enter into licensing relationships with licensees of our
technology;
o enter into relationships with business partners to generate
revenue from website linking and other arrangements; and
o market and sell our Internet services to users of the
GlobalPC.
We believe that period-to-period comparisons of our operating results are
not necessarily meaningful and should not be relied upon as indications of
future performance because of
o the closing of our network marketing sales operations in 1999;
o the sale of our public safety software business division in
1999;
o the rapidly evolving nature of business relating to the
Internet and computing devices; and
o the limited operating history in our business of developing
and selling the GlobalPC and related services.
We have to manage our potential growth with a new management team. We
anticipate that:
o expansion of our infrastructure;
o development of the GlobalPC;
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o enhancement and modification of operating system software;
o development of new application software programs; and
o the need to establish and maintain relationships with mass
merchandise retailers, licensees and other business partners
will be required to address potential growth in our customer base and market
opportunities. We expect this expansion will place a significant strain on our
management, operational and financial resources, and is expected to continue to
do so.
Certain members of our management, including our Chairman of the Board
/Chief Executive Officer, Chief Financial Officer/Chief Operating Officer and
Chief Technology Officer, have joined us within the last ten months. Also
certain key personnel came to us from GlobalPC Inc. when we acquired its assets
in December 1999. Our new employees include a number of key management,
engineering, marketing, planning, technical and operations personnel who have
not yet been fully integrated into our company, and we expect to add additional
key personnel in the near future.
To manage the expected growth of our operations and personnel, we will be
required to improve existing operational and financial systems and controls,
implement new ones, and expand, train and manage our growing employee base. We
also will be required to expand our finance, administrative, marketing and
operations staff. Further, we may be required to enter into relationships with
various strategic partners, retailers, manufacturers, suppliers and vendors,
licensors and other third parties necessary to the maintenance and growth of our
business. There can be no assurance that our current and planned personnel,
systems, procedures and controls will be adequate to support our future
operations, or that our management will be able to identify and exploit existing
and potential strategic relationships and market opportunities. Our failure to
manage growth effectively could have a material adverse effect on our business,
results of operations and financial condition.
We depend on key personnel to make our business successful. Our performance
is substantially dependent on the continued services and on the performance of
our senior management and other key personnel. Our performance also depends on
our ability to retain and motivate our other officers and key employees. The
loss of the services of any of our executive officers or other key employees
could delay our ability to expand the markets for our GlobalPC or establish
strategic relationships and we could lose momentum and credibility because of
these delays. This would have a material adverse effect on our business, results
of operations and financial condition. We maintain no "key person" life
insurance policies on any of our personnel.
Our future success depends on our ability to hire, train, retain and
motivate other highly skilled personnel including management, investor
relations, engineering, technical, marketing and customer service personnel.
Competition for such personnel is intense, and there can be no assurance that we
will be able to successfully attract, integrate or retain sufficiently qualified
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<PAGE>
personnel. Our failure to retain and attract the necessary personnel could have
a material adverse effect on our business, results of operations and financial
condition.
There are frequent changes in the markets for our products and services and
interest in our products may be lost. The markets for our products and services
are characterized by rapid technological change and frequent introductions of
new products and services. Our ability to compete will depend on our ability to
adapt, enhance and improve our existing products and services, and to develop
and introduce the GlobalPC and our services in a timely and cost-competitive
manner. We are also concentrating substantially all of our efforts on the
marketing and sale of the GlobalPC and Internet access services to users of the
GlobalPC. We cannot predict whether or not our competitors will develop services
or products that will render ours outmoded or otherwise less marketable, or
whether we will be able to enhance and adapt our products and services
successfully. Any one of these factors may render one or more of our products or
services obsolete. Other companies may be developing products or services of
which we are unaware and which may be similar or superior to some or all of the
products and services we offer.
MyTurn.com substantially relies on certain licenses to develop and sell the
GlobalPC. We rely substantially on our technology license agreement with
Geoworks Corporation ("Geoworks") for a non-transferable license for the GEOS(R)
operating software embedded in the GlobalPC. The term of this license expires on
December 31, 2004 but may be renewed for additional successive one year periods,
each on mutually agreeable terms, if we meet certain royalty payment and
performance thresholds. Also, the license for the GEOS(R) software, specifically
for use in GlobalPCs, is exclusive to us so long as we maintain certain royalty
payment and other performance thresholds. The sublicense with New Deal, which is
a licensee of Geoworks, is expiring on December 31, 2003, and will renew for an
additional one-year. We cannot assure you that we will be able to meet the
thresholds and perform our obligations to obtain and maintain exclusivity or
even to keep the license.
If we lose the license for the GEOS(R) software, we will be unable to
manufacture or sell the GlobalPC. If we lose the exclusive right to use GEOS(R)
software in GlobalPCs, we could face intense competition from substantially the
same type of products which could contain the GEOS(R) software.
We also have a non-transferable, exclusive sublicense from a third party
for the GEOS(R) operating system for use in hard disk or other non-solid state
mass storage devices. The sublicense does not cover certain markets which we
believe will not meaningfully compete with us. The sublicense is for a term
expiring on December 31, 2003, but may be renewed for successive one year terms
if certain conditions for exclusivity are met. The sublicense will be exclusive
so long as we maintain certain royalty payments and other performance
thresholds. We cannot assure we will be able to meet the thresholds of, and
perform our obligations under, the sublicense, or maintain the exclusivity of,
or even keep the sublicense. The sublicense is also subject to the license
between Geoworks and that third party being in effect during the term of the
sublicense. If we lose the sublicense, our continued development and sale of the
GlobalPC could be delayed for approximately ten months. Additionally, if we lose
the sublicense or the
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exclusivity under the sublicense we could face competition from anyone who
sublicenses these rights.
We rely on the marketing and sale of our GlobalPC and licensing of our
technology to generate revenue. We are relying on the successful marketing, sale
and use of the GlobalPC, subscriptions to our Internet service by GlobalPC
users, licensing of our technology, and website linking agreements with business
partners for the near future to develop and grow our operations. We have not
identified any other products which we anticipate developing and bringing to
market in the foreseeable future. If we are unable to sell the GlobalPC or our
market share drops because of competition from products using the GEOS(R)
software or other technology, we will suffer a material adverse effect on its
business, operation and prospects.
We may not be able to continue to grow our business if we suffer problems
in developing and identifying new products. All the risks inherent in developing
or identifying new products and services will accompany our development efforts.
These risks include:
o unanticipated delays;
o expenses and technical problems associated with the
manufacture of technology-related products; and
o the research, marketing and other risks related to
the launching of new services and products.
We cannot assure you that
o we can develop additional products or services or
identify services or products of other parties which
we would like to develop and sell within a reasonable
time period;
o we will have sufficient resources to complete that
development;
o we will have access to sufficient funding to complete
development; or
o we can make economically reasonable arrangements for
the completion of new products or the introduction of
new services by third parties.
Therefore, we can make no assurances as to when, or whether, new products and/or
services will be successfully developed and brought to the market or will become
available.
Emerging GlobalPC market may adversely affect product acceptance. The
market for our GlobalPC is a relatively new and growing niche in the personal
computing industry. If our GlobalPC does not obtain and maintain a proportionate
degree of acceptance or the market for it fails to grow or grows more slowly
than anticipated, or if we are unable to adapt our GlobalPC to meet changing
customer requirements or technological changes in this emerging
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market, our business, operating results and financial condition could be
materially adversely affected.
The success of our business depends on a developing market and is dependent
on continued growth of Internet communication and online commerce. Rapid growth
in the use of, and interest in, the World Wide Web, the Internet and other
online services is a recent phenomenon. There can be no assurance that this
acceptance and use will continue to develop, nor can there be any assurance that
a sufficiently broad base of the consumers we target will adopt, and continue to
use, the Internet as a medium of commerce. The Internet may prove not to be a
viable means of conducting commerce or communications for a number of reasons,
including potentially unreliable network infrastructure and poor performance. In
addition, if the Internet continues to experience significant growth in the
number of users and level of use, the Internet infrastructure may not be able to
support the demands placed on it by such growth. Furthermore, the World Wide Web
has experienced a variety of outages and other delays, and could face such
outages and delays in the future. These outages and delays could adversely
affect the level of Internet use. The Internet could lose its viability due to
delays in the development or adoption of new standards and protocols to handle
increased levels of activity, or due to increased governmental regulation.
Even if the infrastructure, standards or protocols are developed and the
Internet continues to be a viable commercial marketplace in the long term, we
might need to incur substantial expenditures in order to adapt our Internet
service and GlobalPC to changing Web technologies, which could have a material
adverse effect on our business, results of operations and financial condition.
The Internet may also lose viability or flexibility as a marketplace due to
increased governmental regulation. Furthermore, changes in, or insufficient
availability of, telecommunications services to support the Internet or other
online services also could result in slower response times and adversely affect
usage of the Internet and other online services generally.
We face intense competition for our products and services. The markets for
our GlobalPC and Internet products and services are intensely competitive. We
compete directly with
o companies that manufacture and sell personal
computers, Internet access and web tv products;
o providers of Internet access services; and
o developers of other operating systems.
Many of our competitors have much greater name recognition and financial
resources than we do. In addition, Internet access products and services and
personal computers can be purchased in a wide variety of channels of
distribution. Our product offerings in each product category are also relatively
small compared to the wide variety of products offered by many other Internet
service providers and hardware and software manufacturers. There can be no
assurance
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that our business and results of operations will not be affected materially by
market conditions and competition in the future.
Many of our current and potential competitors in all of our markets have
longer operating histories, larger customer bases, and significantly greater
financial, marketing, technical and other resources than we do. Furthermore,
some of these competitors enjoy greater brand recognition than we do. In
addition, certain of our competition may be acquired by, receive investments
from, or enter into other commercial relationships with, larger,
well-established and well-financed companies as use of the Internet and other
online services increases. We cannot assure you that we will be able to compete
successfully against current and future competitors.
We face risks associated with information disseminated through our Internet
access service. The law relating to the liability of online service companies
for information carried on or disseminated through their services is currently
unsettled. It is possible that claims could be made against Internet access and
online service companies for defamation, libel, invasion of privacy, negligence,
copyright or trademark infringement, or other theories based on the nature and
content of the materials disseminated through their services. In addition,
legislation has been proposed that prohibits or imposes liability for the
transmission over the Internet of certain types of information. The potential
that we and other Internet access and online services providers could be exposed
to liability for information carried on or disseminated through Internet access
and online services could require us to take measures to reduce that exposure.
These measures may require that we spend substantial amounts of money and/or
consider discontinuing certain service offerings. Furthermore, the increased
attention focused upon liability issues as a result of lawsuits and legislative
proposals could impede the growth of Internet use. While we carry liability
insurance, it may not be adequate to fully compensate us in the event we become
liable for information carried on or disseminated through our service. Any costs
not covered by insurance incurred as a result of such liability or asserted
liability could have a material adverse effect on our business, results of
operations and financial condition.
Our business may be hindered or restricted by governmental regulation and
legal uncertainties. We are not currently subject to direct federal, state or
local regulation, and laws or regulations applicable to access to or commerce on
the Internet, other than regulations applicable to businesses generally.
However, due to the increasing popularity and use of the Internet and other
online services, it is possible that a number of laws and regulations may be
adopted with respect to the Internet or other online services covering issues
such as
o user privacy;
o freedom of expression;
o pricing;
o content and quality of products and services;
o taxation;
14
<PAGE>
o advertising;
o intellectual property rights; and
o information security.
The adoption of any such laws or regulations might also slow down the growth of
Internet use, which in turn could eliminate or decrease the demand for our
GlobalPC and Internet services, increase our cost of doing business or in some
other manner have a material adverse effect on our business, results of
operations and financial condition.
In addition, the applicability to the Internet of existing laws governing
issues such as property ownership, copyrights and other intellectual property
issues, taxation, libel, and personal privacy is uncertain. The vast majority of
such laws were adopted prior to the advent of the Internet and related
technologies and, as a result, do not address the unique issues raised by use of
the Internet and related technologies. We cannot predict whether the federal
government or one or more states will attempt to impose these laws upon us in
the future or whether such imposition will have a material adverse effect on our
business, results of operations and financial condition.
Several states have also proposed legislation that would limit the uses of
personal user information gathered online or require online services to
establish privacy policies. The Federal Trade Commission also initiated actions
against one online service provider regarding the manner in which personal
information is collected from users and provided to third parties. That action
was settled with the provider having to provide certain notices and following
certain procedures to ask for and get personal information from users. Changes
to existing laws or the passage of new laws intended to address these issues
could create uncertainty in the marketplace that could reduce demand for our
services or increase the cost of doing business, or could in some other manner
have a material adverse effect on our business, results of operations and
financial condition.
Any such new legislation or regulation, or the application of laws or
regulations from jurisdictions whose laws do not currently apply to our
business, could have a material adverse effect on our business, results of
operations and financial condition.
MyTurn.com is qualified to do business in Delaware, New York, California,
Florida and Georgia in the United States. Our failure to qualify as a foreign
corporation in a jurisdiction where we are required to do so could subject us to
taxes and penalties for the failure to qualify, and could result in our being
unable to enforce contracts in those jurisdictions.
We have no manufacturing experience and if we lose any manufacturer of the
GlobalPC it could cause delay in filling orders. MyTurn.com has no experience in
manufacturing products and does not intend to establish its own manufacturing
operations. The GlobalPC is manufactured for us by an OEM manufacturer. We
believe that if our relationship
15
<PAGE>
with this manufacturer ends and we have to secure another manufacturer, which we
believe will be readily available, to manufacture the GlobalPC to our
specifications, we could experience a delay of approximately 150 days in
replenishing inventory. If inventory levels are low, this could delay the
filling of orders. This in turn, could erode customer relationships and
confidence, and cause us to lose customers and orders from customers.
We could face delays in filling orders if components for our GlobalPC are
unavailable. We rely on the availability of the necessary components for our
GlobalPC's to be manufactured on a timely basis. There is currently a world-wide
shortage of certain components which has caused a slow-down or at times a
temporary halt in production of our GlobalPC units. These shortages may continue
to occur and may even be more severe in the future. If our manufacturer is
unable to produce a sufficient number of GlobalPC units to meet our inventory
and order fulfillment needs in the future, we could suffer a depletion of
inventory. This could delay the filling of orders. As a result, we could
experience an erosion of customer relationships and confidence leading to a loss
of customers.
Risks relating to future acquisitions. We are exploring and will continue
to explore opportunities to add or acquire
o technology or products consistent with our current product
line; and
o businesses that make and/or market products or services not in
our current line of business.
In any opportunity that involves the acquisition of assets or a business,
we can not be certain that
o we will successfullyintegrate those assets into our planned
operations;
o all the benefits expected from such integration will be
realized;
o delays or unexpected costs related to the integration will not
have a detrimental affect on implementing our business plan,
or on operating results or financial condition; and
o we will not lose key personnel.
Furthermore, these acquisitions may require us to obtain additional
financing from banks or other financial institutions or to undertake debt or
equity financing. We cannot assure you that we will be able to obtain financing
on commercially reasonable terms or at all. Also, equity financing will result
in a dilution to our existing stockholders; that is, the number of shares that
you own will represent a smaller percentage of our outstanding shares. The
degree of dilution may be significant. In the case of debt financing, we run the
risks of interest rate fluctuations and insufficiency of cash flow to pay
principal and interest, along with other risks traditionally associated with
incurring indebtedness.
16
<PAGE>
We will usually accomplish acquisitions without prior stockholder approval.
The Board of Directors will decide whether any opportunity to add technology,
products or a business is in the best interest of our stockholders. We cannot be
certain that any such opportunities will arise, or that, if they do, we will be
able to reach an agreement on terms acceptable to us. In most cases, an
acquisition will be concluded without stockholder approval and our stockholders
will not have an opportunity to review the financial statements of, or other
information relating to, the acquisition candidate. Although we will attempt to
evaluate the risks inherent in a particular acquisition, we cannot be certain
that we will properly ascertain or assess such significant risk factors.
Control by management and certain stockholders. Our directors and executive
officers and certain significant stockholders own approximately 11.4% of our
outstanding common shares. If certain of executive officers, directors and
significant stockholders exercise options and warrants which are currently
exercisable, or become exercisable within 60 days, they would own approximately
36.6% of our outstanding shares, giving effect to the exercise of those options
and warrants.
Thus, these persons, if acting together, may have the potential voting
strength to exert significant influence over the election of our directors and
over other matters submitted to our stockholders for approval.
Provisions in our certificate of incorporation and by-laws, and certain
state law provisions, could adversely affect our Stockholders. Our Certificate
of Incorporation provides that a director shall not be personally liable to us
or our stockholders for monetary damages for breach of fiduciary duty as a
director, with certain exceptions. These provisions may discourage stockholders
from suing a director for breach of fiduciary duty and may reduce the likelihood
of derivative lawsuits against any director. A "derivative lawsuit" is one in
which a stockholder sues an officer or director of the corporation on behalf of
the corporation, claiming that the officer or director did some harm to the
corporation. In addition, our Certificate of Incorporation provides for
mandatory indemnification of directors and officers to the fullest extent
permitted or not prohibited by Delaware law.
Our Certificate of Incorporation also allows us to issue preferred stock
without approval of the holders of shares. If we issue preferred stock, it could
discourage a third party from buying a majority of our outstanding shares. This,
in turn, could prevent our stockholders from selling their shares at a price
above the market price. The rights that the holders of shares have will be
subject to, and may be negatively affected by, the rights that holders of
preferred stock might be given. In addition, our being governed by a staggered
Board of Directors, certain provisions of our By-Laws, and certain provisions of
Delaware law that are applicable to us all could delay or complicate a merger,
tender offer or proxy contest involving us.
We do not expect to pay dividends. We have never paid any dividends on our
shares and do not intend to in the foreseeable future. We anticipate retaining
any earnings which we may realize in the foreseeable future to finance our
growth.
17
<PAGE>
Nasdaq listing rules could affect our common stock. Our shares are
currently traded on the Nasdaq SmallCap Market. If we are unable to satisfy the
requirements for continued quotation on that market, trading of our shares would
be conducted in the over-the-counter market, in what is commonly referred to as
the "pink sheets" or on the NASD OTC Electronic Bulletin Board. If the shares
you acquire under this Prospectus are traded only in the "pink sheets" or on the
Electronic Bulletin Board, you may find it more difficult to dispose of the
shares or obtain accurate quotations as to their price.
For continued listing on the Nasdaq SmallCap Market, we are required to
have, among other things, all of the following:
o either net tangible assets of $2,000,000, or market
capitalization of $35,000,000, or net income for two of the
last three fiscal years of $500,000;
o minimum market value or public float of $1,000,000; and
o minimum bid price of $1.00 per share.
Nasdaq also requires that we have at least two independent directors and an
Audit Committee, a majority of whose members must also be independent directors.
Although we currently satisfy the net tangible assets / market capitalization /
net income requirements there is no assurance we will continue to satisfy those
requirements and any other requirement in the short term or the long term. If we
do not develop meaningful operations relating to the sale of the GlobalPC or
other business and we do not sustain operations at a meaningful level, we may
fail to satisfy and maintain the continued listing criteria for the Nasdaq
SmallCap Market. In such case, we would, in all likelihood, be delisted from
Nasdaq.
"Penny Stock" rules could effect our common stock. The SEC has regulations
that generally define "penny stock" to be common stock that has a market price
of less than $5.00 per share. Over the past 12 months our shares have traded
both above and below $5.00 per share. Our shares offered are authorized for
quotation on the Nasdaq SmallCap Market; therefore they are exempt from the
definition of "penny stock." However, if our shares are removed from the Nasdaq
SmallCap Market at any time, then, if the market price is below $5.00 per share
they will be subject to rules that impose additional sales practice
requirements. The "penny stock" rules may restrict the ability of broker-dealers
to sell our shares, and the penny stock rules may affect your ability to sell
our shares in the secondary market as well as the price at which such sales can
be made. Also, some brokerage firms will decide not to effect transactions in
"penny stocks" and it is unlikely that any bank or financial institution will
accept "penny stock" as collateral.
For transactions covered by these rules, the broker-dealer must make a
special determination that a purchaser is suitable to purchase the shares and
must have received the purchaser's written consent to the transaction prior to
the purchase. The "penny stock" rules also require the delivery, prior to the
transaction, of a risk disclosure document mandated by the SEC relating to the
penny stock market. The broker-dealer must also disclose
18
<PAGE>
o the commission payable to both the broker-dealer and the
registered representative,
o current quotations for the shares, and
o if the broker-dealer is the sole market maker, the
broker-dealer must disclose this fact and the broker-dealer's
presumed control over the market.
Finally, monthly statements must be sent disclosing recent price information for
the penny stock held in the account and information on the limited market in
penny stocks. These rules would apply to sales by broker-dealers to persons
other than established customers and accredited investors until our shares trade
above $5.00 per share. Accredited investors are generally those with assets in
excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together
with their spouse.
A significant number of shares are eligible for sale and their sale could
depress our stock price. Approximately 1,567,151 of our common shares will be
immediately eligible to be sold in the public market as a result of this
offering. Also, approximately 7,742,495 common shares will become eligible for
sale in the public market once warrants to purchase these shares are exercised.
These warrants have exercise prices ranging from $1.50 to $20.25 per share. Of
these warrants, warrants for approximately 4,573,002 common shares are
exercisable now or will become exercisable in 60 days. The remaining warrants
will become exercisable in the future or when performance thresholds are met. We
cannot determine if or when these thresholds will be met. Sales of substantial
amounts of our common shares in the public market after this offering could
depress the market price of our common stock.
If all outstanding options or warrants for our common shares are exercised,
there would be approximately 28,000,000 common shares outstanding.
These sales and the number of outstanding common shares also might make it
more difficult for us to sell equity or equity-related securities in the future
at a time and price that we deem appropriate.
An increase in the number of our outstanding shares could depress the
market price of our shares. We are able to issue additional common shares, or
preferred shares or other securities which are exercisable into common shares,
up to our authorized capital of 60,000,000 common shares. An increase in the
number of outstanding common shares in the future could depress the market price
for our common shares.
19
<PAGE>
FORWARD-LOOKING STATEMENTS
Certain statements contained in this Prospectus are "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995, and are subject to the safe harbor created by that act. MyTurn.com
cautions readers that certain important factors may affect MyTurn.com's actual
results and could cause such results to differ materially from any forward-
looking statements which may be deemed to have been made in this prospectus or
which are otherwise made by or on behalf of MyTurn.com.
For this purpose, any statements contained in this prospectus that are not
statements of historical fact may be deemed to be forward-looking statements.
Without limiting the generality of the foregoing, words such as "may," "will,"
"expect," "believe," "anticipate," "intend," "could," "estimate," "plan" or
"continue" or the negative variations thereof or comparable terminology are
intended to identify forward-looking statements. Factors which may affect
MyTurn.com's results include, but are not limited to, the risks and
uncertainties associated with the Internet and Internet-related technology and
products, new technology developments, developments and regulation in the
telecommunications industry, the competitive environment within the Internet and
telecommunications industries, the ability of MyTurn.com to develop its
infrastructure, the ability to enter into agreements with mass merchandise
retailers and to develop other sales outlets for its products, the success of
MyTurn.com's marketing strategy, the ability to develop consumer awareness and
acceptance of our GlobalPC product, the rate at which users of the Global PC
sign-up for MyTurn.com's Internet services, the ability of MyTurn.com to comply
with its obligations under the manufacturing agreement for the production of the
GlobalPC and related banking agreements, the continued manufacture of our Global
PC product meeting satisfactory quality standards, the level of costs incurred
in connection with MyTurn.com's planned expansion efforts, unascertainable risks
related to possible acquisitions, uncertainties inherent in litigation, the risk
of loss of management and personnel, economic conditions, and the ability of
MyTurn.com to raise additional capital which will be required within the next 60
days to continue to develop and sustain its business at current levels and to
implement MyTurn.com's business plan and generate revenue.
MyTurn.com is also subject to other risks detailed in this prospectus or
detailed from time to time in MyTurn.com's SEC filings. Readers are also urged
to carefully review and consider the various disclosures made by MyTurn.com
which attempt to advise interested parties of the factors which affect
MyTurn.com's business, including, without limitation, the disclosures made under
the captions "The Company" and "Risk Factors", elsewhere in this Prospectus.
SELLING STOCKHOLDERS
The following table sets forth the name of each selling stockholder, the
number of shares of MyTurn.com beneficially owned by such selling stockholder as
of October 18, 2000 and the number of shares being offered by such selling
stockholder. The shares being offered hereby are being registered to permit
public secondary trading, and the selling stockholders may offer all or part of
the shares for resale from time to time. However, such selling stockholders are
under no
20
<PAGE>
obligation to sell all or any portion of their shares nor are such selling
stockholders obligated to sell any shares immediately under this prospectus. All
information with respect to share ownership has been furnished by the selling
stockholders. See "Plan of Distribution."
The reflection in the table below of shares beneficially owned or to be
sold in the offering is not intended to constitute a prediction as to either the
number of shares into which warrants will be exercised or the number of shares
otherwise eligible for registration that will be offered.
<TABLE>
<CAPTION> Shares Owned
(and Percentage
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
<S> <C> <C> <C> <C>
deCerner Alain 40,020(3) 15,020(3) 26,000 *
------------------------------------------------------------------------------------------------------------------------
Allentown Investment Ltd. 120,060(4) 45,060(4) 75,000 *
------------------------------------------------------------------------------------------------------------------------
Allstate Abstract Corp. 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Ronald Ameerali 21,270(5) 8,770(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Baptist Community Services 19,760 1,260 18,500 *
------------------------------------------------------------------------------------------------------------------------
Masood Bhatti 21,270(5) 8,770(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Jay Bosselman 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
John W. Caldwell 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Vincent Campitiello 21,270(5) 8,770(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Dr. Hans-Christian Donnerstag 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
Frank J. Gandio 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Louis Gandio 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Louis Gandio, Jr. 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Ralph Harrari 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
21
<PAGE>
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
Martin Hodas 120,060(4) 45,060(4) 75,000 *
------------------------------------------------------------------------------------------------------------------------
T.H. Holloway 19,760 1,260 18,500 *
------------------------------------------------------------------------------------------------------------------------
Neil Jones 39,520 2,520 37,000 *
------------------------------------------------------------------------------------------------------------------------
Simon Ostrowlecki 39,520 2,520 37,000 *
------------------------------------------------------------------------------------------------------------------------
Garry and Rebecca Perrine 79,040 5,040 74,000 *
------------------------------------------------------------------------------------------------------------------------
Michael Rosenfeld & Stanley 40,020(3) 15,020(3) 25,000 *
Eisenberg TTEE's
Testamentary Trust
Robert T. Rosenfeld, Trustee
------------------------------------------------------------------------------------------------------------------------
Hart Rotenberg 39,520 2,520 37,000 *
------------------------------------------------------------------------------------------------------------------------
Joseph Rotenberg 39,520 2,520 37,000 *
------------------------------------------------------------------------------------------------------------------------
Richard Rozzi 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
Seabrite Investment Corporation 513,760 32,760 481,000 3.95%
-------------------------------------------------------------------------------------------------------------------------
Sarjit Singh 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
Socrates Skiadas 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
Christopher Leng Smith 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
United Technologies Limited 240,120(6) 90,120(6) 150,000 1.23%
-------------------------------------------------------------------------------------------------------------------------
Jean Pierre Varon 40,020(3) 15,020(3) 25,000 *
------------------------------------------------------------------------------------------------------------------------
Richard E. Volkman 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
22
<PAGE>
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
Donald S. Wall 20,010(5) 7,510(5) 12,500 *
------------------------------------------------------------------------------------------------------------------------
Joseph Charles & Associates, 12,000(7) 6,000(7) 6,000 *
Inc. Warrant Plan
------------------------------------------------------------------------------------------------------------------------
Joseph Charles & Associates, 11,000(7) 5,000(7) 6,000 *
Inc. (IB Bonus Pool)
------------------------------------------------------------------------------------------------------------------------
Joseph Charles & Associates, 42,250(7) 19,000(7) 23,250 *
Inc.
------------------------------------------------------------------------------------------------------------------------
Bruce Jordan 6,160(7) 2,800(7) 3,360 *
------------------------------------------------------------------------------------------------------------------------
Edward McPhee 40,000(7) 10,000(7) 30,000 *
------------------------------------------------------------------------------------------------------------------------
Mystical Dragon, LP 24,200(7) 11,000(7) 13,200 *
------------------------------------------------------------------------------------------------------------------------
Anthony C. Pintsopoulos 11,880(7) 5,400(7) 6,480 *
------------------------------------------------------------------------------------------------------------------------
Suzanne Trapani 1,760(7) 800(7) 960 *
------------------------------------------------------------------------------------------------------------------------
Gerald and Esther Daniel 400(7) 400(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Michael Daniels 2,000(7) 2,000(7) 0 *
Kay Daniels
------------------------------------------------------------------------------------------------------------------------
Geraldine and Alan Daniels 20,000(7) 20,000(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Robert Daniels 800(7) 800(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Mark Goldstein 2,400(7) 2,400(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Carl J. Hanig 800(7) 800(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Barry Kramer 1,000(7) 1,000(7) 0 *
Donna Zalichin
------------------------------------------------------------------------------------------------------------------------
David Lum 800(7) 800(7) 0 *
23
<PAGE>
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
Stephen J. Lum 200(7) 200(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Velma Lum 800(7) 800(7) 0 *
------------------------------------------------------------------------------------------------------------------------
John F. Riley 1,600(7) 1,600(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Christine L. Wallace as 200(7) 200(7) 0 *
Custodian for Jacob Wallace
------------------------------------------------------------------------------------------------------------------------
Christine L. Wallace as 200(7) 200(7) 0 *
Custodian for Lara Wallace
------------------------------------------------------------------------------------------------------------------------
Joseph E. Antonini(8) 50,000(9) 150,000(10) 0 *
------------------------------------------------------------------------------------------------------------------------
StarNet 32,953 32,953 0 *
------------------------------------------------------------------------------------------------------------------------
Kenneth Wilson(11) 27,800(12) 92,860(13) 0 *
------------------------------------------------------------------------------------------------------------------------
Geoworks Corporation 250,000(7) 250,000(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Union Atlantic, L.C. 30,000(7) 30,000(7) 0 *
------------------------------------------------------------------------------------------------------------------------
A.S. Holdings, Inc. 3,538 7,076(14)(15) 0 *
------------------------------------------------------------------------------------------------------------------------
Carlos D. Binns(16) 9,167(17) 10,000(14)(18) 9,167(17) *
------------------------------------------------------------------------------------------------------------------------
Mark Bradlee(19) 432,440(20) 742,200(14)(21) 196,334(17) 1.59%
------------------------------------------------------------------------------------------------------------------------
Christine M. Bradlee Trust, 16,000(22) 80,000(14)(23) 0 *
Mark Bradlee as Trustee
------------------------------------------------------------------------------------------------------------------------
Timothy J. Bradlee Trust, 16,000(22) 80,000(14)(23) 0 *
Mark Bradlee as Trustee
------------------------------------------------------------------------------------------------------------------------
Bradley Family Education 16,000(22) 30,000(14)(23) 0 *
Trust, Mark Bradlee as
Trustee
24
<PAGE>
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
Daniel J. Bradlee Trust, Mark 16,000(22) 80,000(14)(23) 0 *
Bradlee as Trustee
------------------------------------------------------------------------------------------------------------------------
Breadbox Computer 772,746 772,746 0 *
Company
------------------------------------------------------------------------------------------------------------------------
Gordon A. Campbell 35,382 70,764(14)(24) 0 *
------------------------------------------------------------------------------------------------------------------------
Brian Chin(25) 99,601(26) 203,000(14)(27) 39,334(17) *
------------------------------------------------------------------------------------------------------------------------
David Durran(28) 194,000(29) 395,000(14)(30) 76,667(17) *
------------------------------------------------------------------------------------------------------------------------
Harfa Holdings Inc. 3,538 7,076(14)(15) 0 *
------------------------------------------------------------------------------------------------------------------------
Insyde Software 8,103 8,103(14) 0 *
------------------------------------------------------------------------------------------------------------------------
Anna M. Lijphart and Brian 228,169(31) 239,431(14)(32) 33,334(33) *
Dougherty
------------------------------------------------------------------------------------------------------------------------
Paul Chesterman 2,776 2,776(14) 0 *
------------------------------------------------------------------------------------------------------------------------
John and Honora McEvily 3,538 7,076(14)(15) 0 *
------------------------------------------------------------------------------------------------------------------------
Media Supply 4,540 9,080(14)(34) 0 *
------------------------------------------------------------------------------------------------------------------------
Leonard Mendell 3,538 7,706(14)(15) 0 *
------------------------------------------------------------------------------------------------------------------------
Michael Needleman 14,153 28,306(14)(35) 0 *
------------------------------------------------------------------------------------------------------------------------
Performance Marketing, Inc. 23,352 46,704(14)(36) 0 *
------------------------------------------------------------------------------------------------------------------------
Planned Marketing Solution 16,347 16,347(14) 0 *
------------------------------------------------------------------------------------------------------------------------
Productivity Enhancement 2,642 2,642(14) 0 *
Products
------------------------------------------------------------------------------------------------------------------------
Raumer & Associates 1,647 1,647(14) 0 *
25
<PAGE>
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
Donald Reeves(37) 193,550(38) 394,500(14)(39) 76,667(17) *
------------------------------------------------------------------------------------------------------------------------
Louie Reyes 0 45,000(14)(17) 0 *
------------------------------------------------------------------------------------------------------------------------
Matt Rothman 5,491 5,491(14) 0 *
------------------------------------------------------------------------------------------------------------------------
Michael Lipson 5,490 5,490(14) 0 *
------------------------------------------------------------------------------------------------------------------------
Chris Ruppel 1,131 1,131(14) 0 *
------------------------------------------------------------------------------------------------------------------------
Ryantronics Sales & Imports, 3,538 7,076(14)(15) 0 *
Inc.
------------------------------------------------------------------------------------------------------------------------
David R. Sicklesteel 7,077 14,154(14)(40) 0 *
------------------------------------------------------------------------------------------------------------------------
Alex Simonini(41) 21,967(17) 36,000(14)(18) 21,967(17) *
------------------------------------------------------------------------------------------------------------------------
Steven W. Smith 14,152 28,304(14)(42) 0 *
------------------------------------------------------------------------------------------------------------------------
SPLZI Partners, LLC 35,382 70,764(14)(24) 0 *
------------------------------------------------------------------------------------------------------------------------
Lori Freeman 20,000 20,000 0 *
------------------------------------------------------------------------------------------------------------------------
Melissa Mason 20,000 20,000 0 *
------------------------------------------------------------------------------------------------------------------------
Slava Volman 20,000 20,000 0 *
------------------------------------------------------------------------------------------------------------------------
David L. Stetson 27,500 27,500 0 *
------------------------------------------------------------------------------------------------------------------------
Denis Squeri(43) 172,167(44) 290,000(14)(45) 70,834(17) *
------------------------------------------------------------------------------------------------------------------------
David Hunter Squeri 3,466(46) 37,500(14)(47) 0 *
Custodial Trust, Denis J.
Squeri as Trustee
------------------------------------------------------------------------------------------------------------------------
Richard Lawson Squeri 3,466(46) 37,500(14)(47) 0 *
Custodial Trust, Denis J.
Squeri as Trustee
26
<PAGE>
Shares Shares of All Shares)
Beneficially Shares to be Beneficially After the
Owned Prior Sold in the Owned Offering if All
to the Offering Offering After the Offered Shares
Name of Selling Stockholder (1) (2) Offering(1) are Sold
Status One Investments, Inc. 14,153 28,306(14)(48) 0 *
------------------------------------------------------------------------------------------------------------------------
John Wedgewood 2,690 2,690(14) 0 *
------------------------------------------------------------------------------------------------------------------------
Chase Venture Capital 85,164 170,328(14)(49) 0 *
Associates
------------------------------------------------------------------------------------------------------------------------
Brian Dougherty(50) 228,169(51) 506,400(14)(52) 33,334(17) *
------------------------------------------------------------------------------------------------------------------------
Odyssey Capital, LLC 62,500 112,000(53) 0 *
------------------------------------------------------------------------------------------------------------------------
Smith Public Relations 25,411 25,411(14) 0 *
------------------------------------------------------------------------------------------------------------------------
TechFarm II L.P. 42,666(54) 182,000(14)(55) 0 *
------------------------------------------------------------------------------------------------------------------------
TechFarm Management, Inc. 7,563 7,563(14) 0 *
------------------------------------------------------------------------------------------------------------------------
TechFund Capital, L.P. 136,795 273,590(14)(56) 0 *
------------------------------------------------------------------------------------------------------------------------
TechFund Capital 13,577 27,154(14)(57) 0 *
Management, LLC
------------------------------------------------------------------------------------------------------------------------
World Corp. Management 300,000(7) 300,000(7) 0 *
Palm Beach, Inc.
------------------------------------------------------------------------------------------------------------------------
William Reeves 266(54) 500(58) 0 *
------------------------------------------------------------------------------------------------------------------------
Michael Fuchs(59) 2,500,000(7) 2,500,000(7) 0 *
------------------------------------------------------------------------------------------------------------------------
Global PC, Inc. 145,438(60) 158,881(61) 0 *
</TABLE>
------------
*Less than 1%
(1) Unless otherwise noted, MyTurn.com believes that all persons
named above have sole voting and investment power with respect
to all shares beneficially owned by them, subject to community
property laws, where applicable. A person is deemed to be the
beneficial owner of shares that can be acquired by such person
within 60 days from October 18, 2000 upon the exercise of
warrants or options. Each beneficial owner's percentage
ownership is determined by assuming that options
27
<PAGE>
or warrants that are held by such person (but not those held
by any other person) and which are exercisable within 60 days
from October 18, 2000 have been exercised.
(2) The number of shares which the selling stockholders may sell
pursuant to this prospectus may exceed the number of shares
each of them may beneficially own as determined pursuant to
Section 13(d) of the Exchange Act, because all of the shares
underlying warrants held by certain selling stockholders are
registered for resale pursuant to the Registration Statement
of which this prospectus is a part, even though beneficial
ownership of some or all of those shares may only vest in the
selling stockholders more than 60 days after October 18, 2000.
(3) Includes 12,500 shares issuable upon the exercise of warrants.
(4) Includes 37,500 shares issuable upon the exercise of warrants.
(5) Includes 6,250 shares issuable upon the exercise of warrants.
(6) Includes 75,000 shares issuable upon the exercise of warrants.
(7) Issuable upon the exercise of warrants.
(8) Mr. Antonini has been a Director of MyTurn.com, since January
2000.
(9) Issuable upon the exercise of warrants which are currently
exercisable or exercisable within 60 days of October 18, 2000.
(10) Includes 50,000 common shares issuable upon the exercise of
warrants which are currently exercisable, and 100,000 common
shares which are issuable upon the exercise of warrants which
are exercisable upon MyTurn.com reaching certain business
milestones, the timing of which, if reached, cannot presently
be determined.
(11) Mr. Wilson was employed by MyTurn.com from November 4, 1998
thru July 21, 2000.
(12) Includes 40,500 common shares underlying currently exercisable
Class B Warrants.
(13) Includes 40,500 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined, and 51,000 common shares underlying
Class B Warrants.
28
<PAGE>
(14) The common shares and/or common shares underlying warrants are
subject to an agreement between the holder and MyTurn.com,
restricting the transfer of those shares for a period expiring
December 22, 2000 without MyTurn.com's consent.
(15) Includes 3,538 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined.
(16) Mr. Binns has been employed by MyTurn.com as a QA Engineer
since August 20, 2000.
(17) Issuable upon the exercise of options which are currently
exercisable.
(18) Issuable upon the exercise of Class A Warrants, which are
exercisable upon MyTurn.com reaching certain business
milestones, the timing of which, if reached, cannot presently
be determined.
(19) Mr. Bradlee has been a director and the Executive Vice
President of MyTurn.com since December 1999.
(20) Includes 236,106 common shares underlying currently
exercisable Class B Warrants and 196,334 common shares
underlying options which are currently exercisable. Does not
include an aggregate of 64,000 common shares issuable to
Timothy J. Bradlee Trust, Christine M. Bradlee Trust, Bradlee
Family Trust, and the Daniel J. Bradlee Trust underlying Class
B Warrants which are currently exercisable.
(21) Includes 299,500 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined, and 442,700 common shares underlying
Class B Warrants. Does not include 150,000 common shares
underlying Class A Warrants and 120,000 common shares
underlying Class B Warrants issuable to Timothy J. Bradlee
Trust, Christine M. Bradlee Trust, Bradlee Family Trust, and
the Daniel J. Bradlee Trust.
(22) Issuable upon the exercise of currently exercisable Class B
Warrants. Does not include 236,106 common shares underlying
currently exercisable Class B Warrants of Mark Bradlee, and
196,334 common shares underlying options granted to Mark
Bradlee, which are currently exercisable or exercisable within
60 days.
(23) Includes 50,000 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined, and 30,000 common shares underlying
Class B Warrants.
29
<PAGE>
(24) Includes 35,382 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined.
(25) Mr. Chin has been employed by MyTurn.com as a Senior Engineer
since September 23, 2000.
(26) Issuable upon the exercise of currently exercisable Class B
Warrants.
(27) Includes 90,000 common shares underling Class A Warrants and
113,000 common shares underlying Class B Warrants.
(28) Mr. Durran has served as MyTurn.com's Vice President Hardware
Development since December 1999.
(29) Includes 117,333 common shares underlying currently
exercisable Class B Warrants and 76,667 common shares
underlying stock options which are currently exercisable or
exercisable within 60 days.
(30) Includes 175,000 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined and 220,000 common shares underlying
Class B Warrants.
(31) Includes 150,239 common shares underlying currently
exercisable Class B Warrants and 33,334 common shares
underlying currently exercisable stock options of Brian
Dougherty.
(32) Includes 44,596 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined and 150,239 common shares underlying
Class B Warrants.
(33) Common shares underlying currently exercisable stock options
of Brian Dougherty.
(34) Includes 4,540 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
(35) Includes 14,153 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
30
<PAGE>
(36) Includes 23,352 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
(37) Mr. Reeves has served as MyTurn.com's Vice-President, Software
Development since December 1999.
(38) Includes 116,833 common shares underlying currently
exercisable Class B Warrants and 76,667 common shares
underlying stock options which are currently exercisable or
exercisable within 60 days.
(39) Includes 175,000 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined and 219,500 common shares underlying
Class B Warrants.
(40) Includes 7,077 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
(41) Mr. Simonini has been a Director, Business Development since
August 25, 1999.
(42) Includes 14,152 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
(43) Mr. Squeri has served as MyTurn.com's Vice President, Retail
Marketing since December 1999.
(44) Includes 101,333 common shares underlying currently
exercisable Class B Warrants and 70,834 common shares
underlying stock options which are currently exercisable or
exercisable within 60 days. Does not include an aggregate of
7,932 Common shares issuable to David H. Squeri Custodial
Trust, and Richard L. Squeri Custodial Trust underlying
currently exercisable Class B Warrants.
(45) Includes 100,000 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined, and 190,000 common shares underlying
Class B Warrants. Does not include an aggregate of 62,000
common shares underlying Class A Warrants, and an aggregate of
13,000 common shares underlying Class B Warrants issuable to
David H. Squeri Custodial Trust and Richard L. Squeri
Custodial Trust.
(46) Issuable upon the exercise of currently exercisable Class B
Warrants. Does not include 101,333 common shares issuable to
Denis Squeri upon the exercise of
31
<PAGE>
currently exercisable Class B Warrants, or 70,834 common
shares issuable to Denis Squeri upon the exercise of options
which are currently exercisable or exercisable within 60 days.
(47) Includes 31,000 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined and 6,500 common shares underlying
Class B Warrants.
(48) Includes 14,153 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined.
(49) Includes 85,164 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
(50) Mr. Dougherty has served as a Director since January 2000 and
MyTurn.com's Chief Technology Officer since October 13, 2000.
(51) Includes 150,239 common shares underlying currently
exercisable Class B Warrants. Includes 33,334 common shares
issuable upon the exercise of currently exercisable stock
options and 44,596 common shares beneficially owned by Anna J.
Lijphart and Brian Dougherty.
(52) Includes 224,700 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined, and 281,700 common shares underlying
Class B Warrants.
(53) Includes 50,000 common shares issuable upon the exercise of
currently exercisable warrants.
(54) Issuable upon the exercise of currently exercisable Class B
Warrants.
(55) Includes 102,000 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined, and 80,000 common shares underlying
Class B Warrants.
(56) Includes 136,795 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
32
<PAGE>
(57) Includes 13,577 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
be presently determined.
(58) Issuable upon the exercise of Class B Warrants.
(59) Mr. Fuchs has been a director of MyTurn.com, since January
2000 and Chairman of the Board and Chief Executive Officer
since April 2000.
(60) Includes 133,000 common shares issuable upon the exercise of
currently exercisable Class C Warrants.
(61) Includes 13,443 common shares underlying Class A Warrants,
which are exercisable upon MyTurn.com reaching certain
business milestones, the timing of which, if reached, cannot
presently be determined, and 133,000 common shares issuable
upon the exercise of currently exercisable Class C Warrants.
The shares offered hereby, and included in the registration statement of which
this Prospectus is a part, include such additional number of shares as may be
issuable upon exercise of warrants by reason of any stock split, stock dividend
or similar transaction involving the shares, in each case in order to prevent
dilution, in accordance with Rule 416. In the event the number of shares
issuable upon exercise of warrants exceeds the number of shares included in the
registration statement, an additional registration statement would be required
to cover the excess.
There are no commitments pursuant to which MyTurn.com will receive any
proceeds form the sale of the shares by the selling stockholders.
To MyTurn.com's knowledge, no selling stockholder has had any position,
office or other material relationship with MyTurn.com or any of its affiliates
during the past three years other than as a holder of MyTurn.com's securities,
except that
o Michael Fuchs is Chairman of the Board and Chief
Executive Officer
o Brian Dougherty is Chief Technology Officer and a
Director
o Mark Bradlee is Executive Vice President, and a
Director
o R.E. (Teddy) Turner, IV is a Director
o Dave Durran is Vice President Hardware Development
o Don Reeves is Vice President Software Development
o Dennis Squeri is Vice President, Retail Marketing
33
<PAGE>
USE OF PROCEEDS
All the shares offered hereby are being offered for the account of the
selling stockholders. Accordingly, MyTurn.com will not receive any proceeds of
any sales made under this prospectus, but will receive the exercise price of any
warrants exercised by any of the selling stockholders. Based on currently
available information, MyTurn.com intends to utilize any proceeds received from
the exercise of warrants for working capital and general corporate purposes.
MyTurn.com may use all or a portion of such proceeds for other purposes, should
a reapportionment or redirection of funds be determined to be in the best
interests of MyTurn.com.
PLAN OF DISTRIBUTION
The shares may be sold or distributed from time to time by the selling
stockholders or by their pledgees, donees, transferees or successors in
interest. The shares may be sold or distributed directly to one or more
purchasers, including pledgees, or through brokers, dealers or underwriters who
may act solely as agents or may acquire shares as principals. Sales may be made
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices, at negotiated prices, or at fixed prices, which may be
changed.
The distribution of the shares may be effected in one or more of the
following methods:
o through agents, broker-dealers or underwriters to be
designated, in or through privately negotiated transactions;
o through agents, broker-dealers or underwriters on the Nasdaq
SmallCap Market or on any other market or exchange on which
the shares may be listed;
o purchases by brokers, dealers or underwriters as principal and
resale by them for their own accounts pursuant to this
prospectus;
o short sales against the box, puts and calls, and other
transactions in securities of MyTurn.com or derivatives
thereof;
o in connection with the pledging of shares as collateral for
margin accounts, the shares may be resold pursuant to the
terms of such accounts; or
o any combination of the foregoing, or by any other legally
available means.
Resales or reoffers of the shares by the selling stockholders under the
registration statement and which this prospectus is a part must be accompanied
by a copy of this Prospectus.
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<PAGE>
Furthermore, sales may be made either pursuant to the Registration
Statement or under Section 4(1) of the Securities Act, or pursuant to Rule 144
under the Securities Act. Sales or other distribution of an aggregate of up to
5,177,968 shares, inclusive of 4,553,684 shares underlying unexercised warrants,
by certain selling stockholders who acquired these shares and/or warrants in
connection with our assets from Global PC will also be subject to the terms and
provisions of a Transfer Restriction Agreement between each of those selling
stockholders and MyTurn.com. Those Transfer Restriction Agreements restrict the
sale or transfer of the shares for a period expiring on December 21, 2000.
The selling stockholders and any agents, broker-dealers or underwriters
that participate in the distribution of the shares may be deemed to be
underwriters, and any profit on the sale of the shares by them, and any
discounts, commissions or concessions received by them, may be deemed to be
underwriting commissions or discounts under the Securities Act. Neither
MyTurn.com nor any individual selling stockholder can presently estimate the
amount of such compensation.
Each selling stockholder and any other person participating in a
distribution of securities will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, including, without
limitation, Regulation M, which may restrict certain activities of, and limit
the timing of purchases and sales of securities by, selling stockholders and
other persons participating in a distribution of securities. Furthermore, under
Regulation M, persons engaged in a distribution of securities are prohibited
from simultaneously engaging in market making and certain other activities with
respect to such securities for a specified period of time prior to the
commencement of such distributions, subject to specified exceptions or
exemptions. All of the foregoing may affect the marketability of the securities
offered hereby.
There can be no assurance that the selling stockholders will sell any or
all of the shares offered by them under this prospectus.
LEGAL MATTERS
Certain matters relating to the legality of the securities being
offered hereby are being passed upon for MyTurn.com by Certilman Balin Adler &
Hyman, LLP, 90 Merrick Avenue, East Meadow, New York 11554.
EXPERTS
The conslidated financial statements as of December 31, 1999 and for the
year then ended incorporated in this Prospectus by reference to the Annual
Report on Form 10-KSB of MyTurn.com, Inc. for the year ended December 31, 1999
have been so incorporated in reliance on the report of PricewaterhouseCoopers
LLP, independent accountants, given on the authority of said firm as experts in
auditing and accounting.
The consolidated financial statements as of December 31, 1998 and for the
year then ended incorporated in this Prospectus by reference to the Annual
Report on Form 10-KSB of MyTurn.com, Inc. for the year
35
<PAGE>
ended December 31, 1998 have been so incorporated in reliance on the reports of
Lazar Levine & Felix LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
ADDITIONAL INFORMATION
MyTurn.com has filed a Registration Statement on Form S-3 with the SEC
under the Securities Act with respect to the securities offered hereby. This
Prospectus does not contain all of the information set forth in the registration
statement. For further information with respect to MyTurn.com and the securities
offered hereby, reference is made to the registration statement and to the
exhibits filed therewith, copies of which may be obtained upon payment of a fee
prescribed by the SEC, or may be examined free of charge at the Public Reference
Room maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. You may obtain information on the operation of the
Public Reference Room by calling the SEC at 1- 800-SEC-0330. Furthermore, the
SEC maintains a Web site that contains reports, proxy and information
statements, and other information regarding MyTurn.com. The address of such Web
site is http://www.sec.gov. Each statement made in this Prospectus referring to
a document filed as an exhibit to the registration statement is qualified by
reference to the exhibit for a complete statement of its terms and conditions.
No one has been authorized to give any information or make any
representation not contained in, or incorporated by reference into, this
Prospectus. Therefore, you cannot rely on any information you receive or
representations made that are not in, or incorporated by reference into, this
Prospectus.
If the laws of the place where you live require (a) the authorization of
any offer to sell our shares, or the solicitation of any offer to buy our
shares, through this Prospectus, or (b) the qualification of the person making
the offer or solicitation, and that authorization or qualification has not been
obtained, then this Prospectus is not an offer to sell our shares or the
solicitation of an offer to buy our shares. Also, if it is unlawful for us to
offer our shares to, or solicit an offer to buy our shares from, a particular
person, this Prospectus is not an offer to or solicitation from such a person.
Under no circumstances should you assume that the information in this Prospectus
is correct after the date on the cover page.
36
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses (estimated except for the
Registration Fee) in connection with the offering described in the Registration
Statement:
Registration Fee...................................................$ 10,600
Accountants' Fees and Expenses.................................... 5,000
Legal Fees and Expenses........................................... 30,000
Miscellaneous..................................................... 5,000
--------
Total..............................................................$ 50,600
========
Item 15. Indemnification of Directors and Officers.
Article X of MyTurn.com's Certificate of Incorporation eliminates the
personal liability of directors to MyTurn.com and its stockholders for monetary
damages for breach of fiduciary duty as a director to the fullest extent
permitted by Section 102 of the Delaware General Corporation Law, provided that
this provision shall not eliminate or limit the liability of a director (i) for
any breach of the director's duty of loyalty to MyTurn.com or its stockholders,
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) arising under Section 174 of the
Delaware General Corporation Law (with respect to unlawful dividend payments and
unlawful stock purchases or redemptions), or (iv) for any transaction from which
the director derived an improper personal benefit.
Additionally, MyTurn.com has included in its Certificate of Incorporation
and its by- laws provisions to indemnify its directors, officers, employees and
agents and to purchase insurance with respect to liability arising out of the
performance of their duties as directors, officers, employees and agents as
permitted by Section 145 of the Delaware General Corporation Law. The Delaware
General Corporation Law provides further that the indemnification permitted
thereunder shall not be deemed exclusive of any other rights to which the
directors, officers, employees and agents may be entitled under MyTurn.com's
by-laws, any agreement, vote of stockholders or otherwise.
The effect of the foregoing is to require MyTurn.com to the extent
permitted by law to indemnify the officers, directors, employees and agents of
MyTurn.com for any claim arising against such persons in their official
capacities if such person acted in good faith and in a manner that he reasonably
believed to be in or not opposed to the best interests of MyTurn.com, and, with
respect to any criminal action or proceeding, had no reasonable cause to believe
his conduct was unlawful.
37
<PAGE>
In connection with this Registration Statement, certain of the selling
stockholders, severally but not jointly, have agreed to indemnify MyTurn.com,
its directors, each of its officers who signed this Registration Statement, its
employees, agents and each person who controls it within the meaning of Section
15 of the Securities Act with respect to any statement in or omission from the
Registration Statement or the Prospectus or any amendment or supplement thereto
if such statement or omission was made in reliance upon information furnished in
writing to MyTurn.com by the selling stockholders specifically for use in
connection with the preparation of the Registration Statement. Each selling
stockholder's indemnification obligations are limited to the amount such selling
stockholder actually receives as a result of the sale of the shares registered
for resale hereunder.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers or persons controlling MyTurn.com
pursuant to the foregoing provisions, MyTurn.com has been informed that, in the
opinion of the SEC, such indemnification is against public policy as expressed
in the Securities Act and is therefore unenforceable.
Item 16. Exhibits.
Exhibit Number Description of Exhibit
5 Opinion of Certilman Balin Adler & Hyman, LLP
23.1 Consent of Lazar Levine & Felix LLP
23.2 Consent of PricewaterhouseCoopers LLP(1)
23.3 Consent of Certilman Balin Adler & Hyman, LLP (included
in its opinion filed as Exhibit 5)
24 Powers of Attorney (included in signature page forming a
part hereof).
----------------
(1) To be filed by Amendment.
Item 17. Undertakings.
The undersigned Company hereby undertakes:
(l) To file, during any period in which offers or sales are being
made, 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 set forth in the Registration Statement; notwithstanding
the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of the securities offered would not
exceed that which was
38
<PAGE>
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 SEC pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
Registration Statement; and
(iii) Include any additional or changed material information on
the plan of distribution; provided, however, that paragraphs (l)(i)
and (l)(ii) do not apply if the Registration Statement is on Form S-3
or Form S-8, and the information required in a post-effective
amendment is incorporated by reference from periodic reports filed by
MyTurn.com under the Exchange Act.
(2) For determining any 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.
(3) File a post-effective amendment to remove from registration any of
the securities being registered which remain unsold at the end of the
offering.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of MyTurn.com
pursuant to the provisions described under Item 15 above, or otherwise,
MyTurn.com has been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by MyTurn.com of expenses incurred or paid
by a director, officer or controlling person of MyTurn.com 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,
MyTurn.com 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.
39
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, MyTurn.com,
Inc. certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-3 and has duly caused this amendment to
its registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in New York, New York, on the 30th day of October,
2000.
MyTurn.com, Inc.
By:/s/ Michael Fuchs
---------------------------
Michael Fuchs
Chairman of the Board and
Chief Executive Officer
40
<PAGE>
POWER OF ATTORNEY
Know all men by these presents, that each person whose signature appears below
constitutes and appoints Michael Fuchs with full power to act as his true and
lawful attorney-in-fact and agent, with full power of substitution and
resubstitution for him and in his name, place and stead, in any and all
capacities to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent, and each of his
substitutes, full power and authority to do and perform each and every act and
thing requisite or necessary to be done in and about the premises, as fully to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Capacity Date
--------- -------- ----
/s/ Michael Fuchs Chairman of the Board, October 30, 2000
------------------------- Chief Executive Officer,
Michael Fuchs and Director (Principal
Executive Officer Principal
Accounting Officer Principal
Financial Officer)
/s/ Joseph Antonini Director October 30, 2000
-------------------------
Joseph Antonini
/s/ Mark Bradlee Director October 30, 2000
-------------------------
Mark Bradlee
Director _________, 2000
-------------------------
Jeffrey Coats
/s/ Brian Dougherty Director October 30, 2000
-------------------------
Brian Dougherty
/s/ Mark Kaplan Director October 30, 2000
-------------------------
Mark N. Kaplan
/s/ Harol Lazarus Director October 30, 2000
-------------------------
Harold Lazarus, Ph.D.
Director __________, 2000
--------------------------
R.E. (Teddy) Turner, IV
/s/ Andrew Malik Director October 30, 2000
--------------------------
Andrew Malik
41
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