As Filed with the Securities and Exchange Commission on July 20, 2000
Registration No. 0-26639
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM S-8
REGISTRATION STATEMENT
Under the
SECURITIES ACT OF 1933
-----------------------
Mayall Partners, Inc.
(Exact name of registrant as specified in its charter)
Delaware 317 Madison Avenue, Suite 2310
(State or other jurisdiction New York, New York 10017
of incorporation or (Address of Principal Executive Office; Zip Code)
organization)
13-4031364
(IRS Employer Identification Number)
275,147 Shares of Common Stock
Issuable under Consulting Agreements
James A. Prestiano, Esq.
317 Madison Avenue, Suite 2310
New York, New York 10017
(212) 949-9696
(Name and address of agent for service)
(Telephone number, including area code,
of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of securities Amount Proposed Proposed
to be to be Maximum Offering Maximum Amount of
Registered Registered Price per share Aggregate Offering Price Registration Fee (1)
----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 125,147(1) shares $0.009(2) $1,126 $0
$0.001 par value,
issuable under
Consulting
Agreements
150,000(1) shares $0.01 $1,500
Common Stock,
$0.001 par value,
issuable under
warrants issued
pursuant to Consulting
Agreements
======================================================================================================================
</TABLE>
(1) This Registration Statement shall also cover any additional shares of
Common Stock that become issuable by reason of any stock dividend, stock split,
recapitalization, or other similar transaction effected without the receipt of
consideration which results in an increase in the number of outstanding shares
of Common Stock of the Registrant.
(2) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457(h) under the Securities Act of 1933 on the basis of the
book value of the Registrant's Common Stock ($0.009) as of March 31, 2000.
<PAGE>
The information in this prospectus is not complete and may be changed. These
securities may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. This preliminary prospectus is
not an offer to sell these securities and it is not soliciting an offer to buy
these securities in any jurisdiction where the offer or sale is not permitted.
PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION
MAYALL PARTNERS, INC.
Common Stock
275,147 Shares
The stockholders of Mayall Partners, Inc. listed on page 12 will,
from time to time, be offering and selling an aggregate of 275,147 shares of our
common stock under this prospectus. The shares being offered under this
prospectus include: (i) 125,147 shares of our common stock that were issued to
certain of our consultants and (ii)150,000 shares that will be issued to our
consultants upon the exercise of outstanding warrants.
The selling stockholders' shares are not being underwritten and we will
not receive any proceeds from the sale of the shares.
There is currently no public market for our common stock.
Prospective purchasers of our shares should carefully read the risk
factors beginning on page 5.
The Securities and Exchange Commission and state securities regulators
have not approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is July 18, 2000.
<PAGE>
TABLE OF CONTENTS
Prospectus Summary.................................................... 3
Risk Factors.......................................................... 5
Selling Stockholders.................................................. 12
Use of Proceeds....................................................... 13
Plan of Distribution.................................................. 14
Legal Matters......................................................... 15
Experts............................................................... 15
Where You Can Find More Information................................... 16
2
<PAGE>
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this prospectus and the documents and
information incorporated herein by reference. This prospectus contains
forward-looking statements which involve risks and uncertainties. Our actual
results could differ materially from those anticipated in these forward-looking
statements as a result of a variety of factors, including those set forth under
"Risk Factors" and elsewhere in this prospectus. The information contained in
this prospectus is accurate only as of the date of this prospectus, regardless
of the time of delivery of this prospectus or of any sale of our common stock.
In this prospectus, references to the "Company," "we," "our" and "us" refer to
Mayall Partners, Inc., a Delaware corporation.
Our Business
Mayall Partners, Inc. is a capital market access corporation. We have
no operating business. We do not intend to develop our own operating business
but instead will seek to effect a merger with a corporation which owns an
operating business and wishes to undertake a merger for its own corporate
purposes, including, among other things, achieving liquidity for its
stockholders. We have not yet selected or entered into any substantive
discussions with any potential merger target and do not intend to limit
potential candidates to any particular field or industry, but do retain the
right to limit candidates, if we so choose, to a particular field or industry.
We may effect a merger with a merger target which may be financially unstable or
in its early stages of development or growth.
Selecting a merger target will be complex and extremely risky. Because
of general economic conditions, rapid technological advances being made in some
industries, and shortages of available capital, management believes that there
are numerous entities seeking the benefits of a publicly-traded corporation.
Such perceived benefits of a publicly traded corporation may include
facilitating or improving the terms on which additional equity financing may be
sought, providing liquidity for the principals of a business, creating a means
for providing incentive stock options or similar benefits to key employees,
providing liquidity (subject to restrictions of applicable statues) for all
stockholders, and other items. Potential merger targets may exist in many
different industries and at various stages of development, all of which will
make the task of comparative investigation and analysis of such merger targets
extremely difficult and complex.
We have insufficient capital with which to provide the owners of merger
targets significant cash or other assets. We believe that we will offer owners
of merger targets the opportunity to acquire a controlling ownership interest in
a public company at substantially less cost than is required to conduct an
initial public offering. Nevertheless, we have not conducted market research and
are not aware of statistical data which would support the perceived benefits of
a merger or acquisition transaction for the owners of a merger target.
It is impossible to predict at this time the status of any business in
which we may become engaged, in that such business may need to seek additional
capital, may desire to have its shares publicly traded, or may seek other
perceived advantages which we may offer. However, we do not intend to obtain
funds in one or more private placements to finance the operation of any acquired
business opportunity until such time as we have successfully consummated a
merger with an existing company.
Pursuant to an oral agreement with The Law Offices of James A.
Prestiano, Esq, a firm controlled by our President, James A. Prestiano, we
utilize and will continue to utilize the office space of such firm as our
principal executive office. That office is located at 317 Madison Avenue, Suite
2310, New York, NY 10017, telephone: (212) 949-9696, facsimile: (212) 949- 6241.
3
<PAGE>
The Offering
Common Stock offered by the
selling stockholders 275,147 shares(1)
Common Stock outstanding 2,541,000 shares(2)
(1) Consists of 125,147 shares of common stock currently outstanding and 150,000
shares of common stock issuable upon the exercise of currently outstanding
warrants.
(2) Consists of (i) 2,340,000 shares of common stock and (ii) 201,000 shares of
common stock issuable upon the exercise of outstanding warrants.
4
<PAGE>
RISK FACTORS
You should carefully consider the risks described below. The risks and
uncertainties described below are not the only ones we face. Additional risks
and uncertainties not presently known to us or that we currently deem immaterial
may also impair our operations. If any of the following risks actually occur,
our business, financial condition or results of operations could be materially
and adversely affected.
We Have No Operating History or Basis for Evaluating Prospects
We were incorporated in October 1998 and have no operating business or
plans to develop one and have not, as of the date hereof, identified any merger
targets. Accordingly, there is only a limited basis upon which to evaluate our
prospects for achieving our intended business objectives. To date, our efforts
have been limited to organizational activities and an offering of our common
stock.
We Have Limited Resources and No Present Source of Revenues
We have limited resources and have had no revenues to date. In
addition, we will not achieve any revenues (other than insignificant investment
income) until, at the earliest, the consummation of a merger. Moreover, there
can be no assurance that any merger target, at the time of our consummation of a
merger, or at any time thereafter, will derive any material revenues from its
operations or operate on a profitable basis. Further, in order to avoid status
as an "Investment Company" under the Investment Company Act of 1940, we will
only invest our funds prior to a merger in limited investments which do not
trigger Investment Company status. There can be no assurance that determinations
ultimately made by us will permit us to achieve our business objectives.
We May Need Additional Financing In Order to Execute Our Business Plan
We have had no revenues to date and will be entirely dependent upon our
limited available financial resources to implement our business objectives. We
cannot ascertain with any degree of certainty the capital requirements for the
execution of our business plan. In the event that our limited financial
resources prove to be insufficient to implement our business plan (because of
the size of the merger or other reasons), we may be required to seek additional
financing. In addition, in the event of the consummation of a merger, we may
require additional financing to fund the operations or growth of the merger
target.
Additional Financing May Not Be Available to Us If Needed
There can be no assurance that additional financing, if needed, will be
available on acceptable terms, or at all. To the extent that additional
financing proves to be unavailable when needed, we would, in all likelihood, be
compelled to abandon plans of a merger, and would have minimal capital remaining
to pursue other merger targets. Our failure to secure additional financing, if
needed, could also have a material adverse effect on the continued development
or growth of our merger target. We have no arrangements with any bank or
financial institution to secure additional financing and there can be no
assurance that any such arrangement, if required or otherwise sought, would be
available on terms deemed to be commercially acceptable and in our best
interests.
We May Not Be Able to Borrow Funds If Needed
There currently are no limitations on our ability to borrow funds to
increase the amount of capital available to us to effect a merger. However, our
limited resources and lack of operating history will make
5
<PAGE>
it difficult to borrow funds. The amount and nature of any of our borrowings
will depend on numerous considerations, including our capital requirements, our
perceived ability to meet debt service on any such borrowings and the then
prevailing conditions in the financial markets, as well as general economic
conditions. There can be no assurance that debt financing, if required or
sought, would be available on terms deemed to be commercially acceptable by us
and in our best interests. Our inability to borrow funds required to effect or
facilitate a merger, or to provide funds for an additional infusion of capital
into a merger target, may have a material adverse effect on our financial
condition and future prospects. Additionally, to the extent that debt financing
ultimately proves to be available, any borrowings may subject us to various
risks traditionally associated with indebtedness, including the risks of
interest rate fluctuations and insufficiency of cash flow to pay principal and
interest. Furthermore, a merger target may have already incurred borrowings and,
therefore, all the risks inherent thereto.
We Are Unable to Ascertain Risks Relating to the Industry and Nature of
Unidentified Merger Targets
We have not selected any particular industry or merger target in which
to concentrate our merger efforts. Our director and executive officer has had no
contact or discussions with any entity or representatives of any entity
regarding a consummation of a merger. Accordingly, there is no basis to evaluate
the possible merits or risks of a merger target or the particular industry in
which we may ultimately operate, and therefore risks of a currently
unascertainable nature may arise when a specific merger target and industry is
chosen. For example, to the extent that we effect a merger with a financially
unstable company or an entity in its early stage of development or growth
(including entities without established records of revenues or income), we will
become subject to numerous risks inherent in the business and operations of
financially unstable and early stage or potential emerging growth companies. In
addition, to the extent that we effect a merger with an entity in an industry
characterized by a high level of risk, we will become subject to the currently
unascertainable risks of that industry. An extremely high level of risk
frequently characterizes certain industries which experience rapid growth.
Although management will endeavor to evaluate the risks inherent in a particular
merger target or industry, there can be no assurance that we will properly
ascertain or assess all such risks.
Scarcity of and Competition for Merger Opportunities May Hinder the
Identification of a Merger Target and the Consummation of a Merger
We expect to encounter intense competition from other entities having
business objectives similar ours. Many of these entities, including venture
capital partnerships and corporations, other blind pool companies, large
industrial and financial institutions, small business investment companies and
wealthy individuals, are well-established and have extensive experience in
connection with identifying and effecting mergers directly or through
affiliates. Many of these competitors possess greater financial, technical,
human and other resources than us and there can be no assurance that we will
have the ability to compete successfully. Our financial resources will be
limited in comparison to those of many of our competitors. This inherent
competitive limitation may compel us to select certain less attractive merger
prospects. There can be no assurance that such prospects will permit us to
achieve our stated business objectives.
We Have No Current Agreement With any Possible Merger Target and No Standards
for a Merger, Which May Impair the Identification, Evaluation and Consummation
of Suitable Merger Opportunities
We have no arrangement, agreement, or understanding with respect to
engaging in a merger with any private entity. There can be no assurance that we
will successfully identify and evaluate suitable merger opportunities or
conclude a merger. Our management has not identified any particular industry or
specific business within an industry for evaluations. There is no assurance that
we will be able to negotiate a merger on terms favorable to us. We have not
established a specific length of operating history or a
6
<PAGE>
specified level of earnings, assets, net worth or other criteria which we will
require a merger target to have achieved. Accordingly, we may enter into a
merger with a merger target having no significant operating history, losses,
limited or no potential for earnings, limited assets, negative net worth, or
other negative characteristics.
Success of Our Business Plan Depends In Large Part Upon the Consummation of a
Merger
The success of our proposed plan of operation will depend to a great
extent on locating and consummating a merger with a merger target. Subsequent to
any merger, our success will depend greatly on the operations, financial
condition, and management of the identified merger target. While our management
intends to seek a merger with a company that has an established operating
history, we cannot assure that we will successfully locate candidates meeting
such criteria. In the event we complete a merger, the success of our operations
may be dependent upon management of the successor entity together with numerous
other factors beyond our control.
We May Be Subject to Uncertainty in the Competitive Environment of a Merger
Target
In the event that we succeed in effecting a merger, we will, in all
likelihood, become subject to intense competition from competitors of the merger
target. In particular, certain industries which experience rapid growth
frequently attract an increasingly larger number of competitors, including
competitors with greater financial, marketing, technical, human and other
resources than the initial competitors in the industry. The degree of
competition characterizing the industry of any prospective merger target cannot
presently be ascertained. There can be no assurance that, subsequent to a
consummation of a merger, we will have the resources to compete effectively in
the industry of the merger target, especially to the extent that the merger
target is in a high-growth industry.
Probable Lack of Business Diversification Due to Limited Resources Limits the
Prospects for Our Success
As a result of our limited resources, in all likelihood we will have
the ability to effect only a single merger. Accordingly, our success will be
entirely dependent upon the future performance of a single business. Unlike
certain entities which have the resources to consummate several mergers or
entities operating in multiple industries or multiple segments of a single
industry, it is highly likely that we will not have the resources to diversify
our operations or benefit from the possible spreading of risks or offsetting of
losses. Our probable lack of diversification may subject us to numerous
economic, competitive and regulatory developments, any or all of which may have
a material adverse impact upon the particular industry in which we may operate
subsequent to the consummation of a merger. The prospects for our success may
become dependent upon the development or market acceptance of a single or
limited number of products, processes or services. Accordingly, notwithstanding
the possibility of capital investment in and management assistance to the merger
target, there can be no assurance that the merger target will prove to be
commercially viable.
We May Pursue a Merger With a Merger Target Operating Outside the United States:
Special Additional Risks Relating to Doing Business in a Foreign Country
We may effectuate a merger with a merger target whose business
operations or even headquarters, place of formation or primary place of business
are located outside the United States. In such event, we may face the
significant additional risks associated with doing business in that country. In
addition to the language barriers, different presentations of financial
information, different business practices, and other cultural differences and
barriers that may make it difficult to evaluate such a merger target, ongoing
business risks result from the internal political situation, uncertain legal
systems and applications of law, prejudice against foreigners, corrupt
practices, uncertain economic policies and potential political and economic
instability that may be exacerbated in various foreign countries.
7
<PAGE>
We Depend Upon a Single Executive Officer and Director
Our ability to successfully effect a merger will be dependent upon the
efforts of our executive officer and sole director, Mr. James Prestiano.
Notwithstanding the significance of Mr. Prestiano, we have not entered into
employment agreements or other understandings with Mr. Prestiano concerning
compensation or obtained any "key man" life insurance on his life. The loss of
the services of Mr. Prestiano could have a material adverse effect on our
ability to successfully achieve our business objectives. Mr. Prestiano is not
required to commit a substantial amount of his time to our affairs and,
accordingly, may have conflicts of interests in allocating management time among
various business activities. We will rely upon the expertise of Mr. Prestiano
and do not anticipate that we will hire additional personnel. However, if
additional personnel are required, there can be no assurance that we will be
able to retain such necessary additional personnel.
Our Sole Executive Officer and Director Has Limited Experience
Although Mr. Prestiano has experience in buying and selling businesses,
he has no prior experience in "blind pool" or "blank check" companies such as
us, nor has he been a director or officer of any public company.
Mr. Prestiano Has Centralized Control of Our Affairs
Mr. Prestiano owns 2,000,000 shares of our common stock, representing
approximately 85% of our issued and outstanding shares of common stock. In the
election of directors, stockholders are not entitled to cumulate their votes for
nominees. Accordingly, as a practical matter, management may be able to elect
all of our directors and otherwise direct our affairs. Additionally,
stockholders will only be permitted to vote on a merger if a stockholder vote is
required under Delaware General Corporation Law, and, even if allowed to vote,
Mr. Prestiano controls a majority of our stock, thus effectively giving him
control.
There Exist Conflicts of Interest Relating to Mr. Prestiano's Inter-Company
Conflicts
Mr. Prestiano serves as the sole director and officer of other
companies that contemplate the same business activities that we do and thus
compete directly with us. As a result, Mr. Prestiano will have a conflict of
interest with respect to prospective merger targets and presenting a corporate
opportunity to us. In general, officers and directors of a corporation
incorporated under the laws of the State of Delaware are required to present
certain business opportunities to such corporation. As a result of Mr.
Prestiano's business associations with multiple companies he will have
conflicting interests. Therefore, we have agreed that with respect to conflicts
of interest amongst these companies related to the allocation of opportunities
to negotiate and merge with merger targets, we will waive any conflict or claim
related to Mr. Prestiano's fiduciary duty. However, the conflict should be
mitigated by the fact that Mr. Prestiano has the same ownership interest in each
other company as he does in us, and each company (including us) has identical
stockholders, at least initially. The conflict will be more significant should,
at a later date, these facts change.
There Exist Conflicts of Interest Relating to Mr. Prestiano's Time Commitment to
Us
Mr. Prestiano is not required to commit his full time to our affairs
and it is likely that he will not devote a substantial amount of time to our
affairs. Mr. Prestiano will have conflicts of interest in allocating management
time among various business activities. As a result, the consummation of a
merger may require a greater period of time than if our management devoted their
full time to our affairs. However, Mr. Prestiano will devote such time as he
deems reasonably necessary to carry out our business and affairs, including the
evaluation of potential merger targets and the negotiation and consummation of a
merger
8
<PAGE>
and, as a result, the amount of time devoted to our business and affairs may
vary significantly depending upon, among other things, whether we have
identified a merger target or are engaged in active negotiation and consummation
of a merger. Mr. Prestiano is affiliated with nine other companies engaged in
business activities similar to those to be conducted by us, and may in the
future become affiliated with more, and therefore may have conflicts of interest
in determining to which entity a particular business opportunity should be
presented. In general, officers and directors of a corporation incorporated
under the laws of the State of Delaware are required to present certain business
opportunities to such corporation. Accordingly, as a result of multiple business
affiliations, Mr. Prestiano may have similar legal obligations to present
certain business opportunities to multiple entities. There can be no assurance
that any of the foregoing conflicts will be resolved in favor of us.
There Exist Conflicts of Interest Relating to the Compensation and Reimbursement
of Mr. Prestiano and Affiliates
Although Mr. Prestiano will receive no compensation for his services as
our sole director and/or president, he and his affiliates will be reimbursed,
at-cost, for any expenses incurred in respect of our reasonable business
expenses, including in relation to our formation, our private placement, the
filing of our registration statement with the Securities and Exchange Commission
and effecting any merger. This will include reimbursement for the cost of the
personnel of Mr. Prestiano or his affiliates (other than Mr. Prestiano himself)
to be inclusive of all documented costs of their employment on a reasonable
hourly or daily allocation while engaged in activities on our behalf.
There Exists the Likelihood of a Change in Control and Management Upon the
Consummation of a Merger
It is likely that any merger will result in control by the stockholders
of the merger target and that our stockholders would retain only a relatively
small minority position. Any such merger may require our management to sell,
transfer or cancel all or a portion of our stock held by management, or cause
Mr. Prestiano to resign or be removed as executive officer and/or sole director
and a corresponding reduction in or elimination of his participation in our
future affairs.
There is Limited Likelihood of a Regular Trading Market for the Common Stock
A public market for our common stock does not exist and there can be no
assurance that one will ever develop or if developed will continue. Creation of
a public market for our common stock depends on the filing of a Form 15c2-11
with NASDAQ for trading on the bulletin board. There can be no assurance,
however, that the filing of a Form 15c2-11 will create a public market for the
common stock. Other means of creating a public market for the common stock
include (i) our acceptance on an exchange or interdealer quotation system, or
(ii) registration of the shares through a registration statement filed under the
Securities Act of 1933, as amended. Such actions may be costly and difficult and
could potentially fail. If so, it would substantially hinder the liquidity of
our common stock. If no market develops, it may be difficult or impossible for
the holders of our common stock to sell their securities if they should desire
to do so. In addition, there are substantial restrictions on the sale or
transfer of common stock imposed by federal and state securities laws, if the
shares of our common stock are not registered through a registration statement.
If the shares are registered, there are no assurances that a regular trading
market will develop for any of the common stock and that if developed any such
market will be sustained. It is unlikely any market would develop without a
merger.
There Exist Risks to Stockholders Relating to Dilution: Authorization of
Additional Securities and Reduction of Percentage Share Ownership Following
Merger
9
<PAGE>
Our certificate of incorporation authorizes the issuance of 40,000,000
shares of common stock. There are currently 37,704,853 authorized but unissued
shares of common stock available for issuance. Except for 201,000 shares of
common stock reserved for issuance upon the exercise of presently outstanding
warrants, we have no commitments as of this date to issue any of these
37,704,853 shares of common stock. We will, in all likelihood, issue a
substantial number of additional shares in connection with or following a
merger. To the extent that additional shares of common stock are issued, our
stockholders would experience dilution of their respective ownership interests.
Additionally, if we issue a substantial number of shares of common stock in
connection with or following a merger, a change in control may occur which may
affect, among other things, our ability to utilize net operating loss carry
forwards, if any. Furthermore, the issuance of a substantial number of shares of
our common stock may adversely affect prevailing market prices, if any, for our
common stock and could impair our ability to raise additional capital through
the sale of our equity securities. We may use consultants and other third
parties providing goods and services, including assistance in the evaluation of
potential merger targets. These consultants or third parties may be paid in
cash, stock, options or other of our securities. Mr. Prestiano has the sole
discretion to engage consultants and other assistance and to pay partially or in
whole with our stock or options for our stock and to raise additional funds by
selling our securities which may involve substantial additional dilution to the
investors.
Regulatory and Statutory Obstacles May Hinder Our Attractiveness to Merger
Candidates
Potential merger targets are often companies which wish to become
public companies to provide liquidity to their shareholders and possibly enhance
their future ability to access the capital markets, without the risk and expense
of an initial public offering. While a merger does not immediately provide
significant capital, it does, if the merger is executed as intended, create a
surviving company which is public, which owns the assets and business of the
merger target (usually in a subsidiary) and the merger target's shareholders end
up with stock in the public company. Management believes that we will generally
be attractive to merger targets if our common stock is being quoted by dealers.
Regulatory and rulemaking authorities have, however, taken steps to make it
difficult to enable shell corporations (with no current business other than one
similar to ours) to have dealer quotations for the securities of such
corporations. Regulatory authorities may scrutinize and possibly take action to
block quotation by a dealer of stock in a shell company such as us. As a result,
there is no assurance that the regulatory authorities will not block the attempt
to obtain dealer quotations for our common stock.
Our Outstanding Shares of Common Stock Are Not Immediately Eligible for Future
Sale
We are filing this Form S-8 registration statement for purposes of
registering an aggregate of 275,147 shares of our common stock issued to our
consultants, including 150,000 shares of common stock issuable upon the exercise
of warrants issued to consultants. Other than these shares, none of our
remaining 2,214,853 outstanding shares of common stock are eligible for sale
under Rule 144 promulgated under the Securities Act. In general, under Rule 144,
as currently in effect, subject to the satisfaction of certain other conditions,
a person, including our affiliates (or persons whose shares are aggregated), who
has owned restricted shares of common stock beneficially for at least one year
is entitled to sell, within any three-month period, a number of shares that does
not exceed the greater of 1% of the total number of outstanding shares of the
same class or, if the common stock is quoted on an exchange or NASDAQ, the
average weekly trading volume during the four calendar weeks preceding the sale.
A person who has not been an affiliate of us for at least three months
immediately preceding the sale and who has beneficially owned the shares of
common stock to be sold for at least two years is entitled to sell such shares
under Rule 144 without regard to any of the limitations described above. No
prediction can be made as to the effect, if any, that sales of such shares of
common stock or the availability of such shares for sale will have on the market
prices, if any, for shares of common stock prevailing from time to time.
Nevertheless, the sale of substantial amounts of common stock in the public
market would likely adversely affect prevailing market prices for the common
stock and could impair our ability to raise capital through the sale of our
equity securities.
10
<PAGE>
The Uncertain Structure of a Merger May Result in Risks Relating to the Market
for Our Common Stock
We may form one or more subsidiary entities to effect a merger and may,
under certain circumstances, distribute the securities of subsidiaries to our
stockholders. There cannot be any assurance that a market would develop for the
securities of any subsidiary distributed to stockholders or, if it did, any
assurance as to the prices at which such securities might trade.
Taxation Considerations May Impact the Structure of a Merger and Post-Merger
Liabilities
Federal and state tax consequences will, in all likelihood, be major
considerations in any merger we may undertake. The structure of a merger or the
distribution of securities to stockholders may result in taxation of us, a
merger target or our stockholders. Typically, these transactions may be
structured to result in tax-free treatment to both companies, pursuant to
various federal and state tax provisions. We intend to structure any merger so
as to minimize the federal and state tax consequences to both us and our merger
target. Management cannot assure that a merger will meet the statutory
requirements for a tax-free reorganization, or that the parties will obtain the
intended tax-free treatment upon a transfer of stock or assets. A non-qualifying
reorganization could result in the imposition of both federal and state taxes,
which may have an adverse effect on both parties to the transaction.
We May Be Deemed an Investment Company and Subjected to Related Restrictions
The regulatory scope of the Investment Company Act of 1940, as amended,
which was enacted principally for the purpose of regulating vehicles for pooled
investments in securities, extends generally to companies engaged primarily in
the business of investing, reinvesting, owning, holding or trading in
securities. The Investment Company Act may, however, also be deemed to be
applicable to a company which does not intend to be characterized as an
investment company but which, nevertheless, engages in activities which may be
deemed to be within the definitional scope of certain provisions of the
Investment Company Act. We believe that our anticipated principal activities,
which will involve acquiring control of an operating company, will not subject
us to regulation under the Investment Company Act. Nevertheless, there can be no
assurance that we will not be deemed to be an investment company, particularly
during the period prior to consummation of a merger. If we are deemed to be an
investment company, we may become subject to certain restrictions relating to
our activities, including restrictions on the nature of our investments and the
issuance of our securities. In addition, the Investment Company Act imposes
certain requirements on companies deemed to be within its regulatory scope,
including registration as an investment company, adoption of a specific form of
corporate structure and compliance with certain burdensome reporting, record
keeping, voting, proxy, disclosure and other rules and regulations. In the event
of our characterization as an investment company, our failure to satisfy such
regulatory requirements, whether on a timely basis or at all, would, under
certain circumstances, have a material adverse effect on our future business
prospects.
We Do Not Expect to Pay Cash Dividends
We do not expect to pay dividends prior to the consummation of a
merger. The payment of dividends after consummating a merger, if any, will be
contingent upon our revenues and earnings, if any, capital requirements, and
general financial condition subsequent to consummation of a merger. The payment
of any dividends subsequent to a merger will be within the discretion of our
then board of directors. We presently intend to retain all earnings, if any, for
use in our business operations and accordingly, our board does not anticipate
declaring any dividends in the foreseeable future.
We are Authorized to Issue Preferred Stock
11
<PAGE>
Our certificate of incorporation authorizes the issuance of 5,000,000
shares of preferred stock, with such designations, powers, preferences, rights,
qualifications, limitations and restrictions of such series as the board of
directors, subject to the laws of the state of Delaware, may determine from time
to time. Accordingly, the board of directors is empowered, without stockholder
approval, to issue preferred stock with dividend, liquidation, conversion,
voting or other rights which could adversely affect the voting power or other
rights of the holders of common stock. In addition, the preferred stock could be
utilized, under certain circumstances, as a method of discouraging, delaying or
preventing a change in control. Although we do not currently intend to issue any
shares of preferred stock, there can be no assurance that we will not do so in
the future. As of this date, we have no outstanding shares of preferred stock.
12
<PAGE>
SELLING STOCKHOLDERS
The shares offered by this prospectus include up to 275,147 shares of
our common stock, including: (i) 125,147 shares of common stock issued to our
consultants as consideration for consulting services rendered by them, and (ii)
150,000 shares of common stock issuable upon the exercise of warrants issued to
our consultants with an exercise price of $0.01 per share.
The shares listed below represent all of the shares that, to our
knowledge, each selling stockholder beneficially owned as of July 18, 2000. The
number of shares each of them may offer and the number of shares each of them
will own after the offering assumes (i) that they sell all of the shares
registered, and (ii) that they acquire no additional shares before completion of
this offering.
<TABLE>
<CAPTION>
Common Common Stock Common Stock
Stock Owned Being Owned After
Name of Selling Stockholder Before Registered(1) Offering(2)
Offering
<S> <C> <C> <C> <C>
Gerry L. Martin (3) 142,000 142,000 0
Steve Wachsler (3) 1,000 1,000 0
H. R. Wachsler (3) 1,000 1,000 0
Terri Murai-Martin (3) 1,000 1,000 0
Toshiko Murai (3) 1,000 1,000 0
George Murai (3) 1,000 1,000 0
Glen Mattern (3) 1,000 1,000 0
William Martin (3) 1,000 1,000 0
Diana Martin (3) 1,000 1,000 0
Robert C. Rosen (4) 29,200 29,200 0
John B. Wallace (4) 3,000 3,000 0
Dennis A Stubblefield (4) 1,200 1,200 0
Scott Price (4) 1,200 1,200 0
Erfat Levy (4) 3,000 3,000 0
David Bleistein (4) 1,200 1,200 0
Lora L. Foley (4) 1,200 1,200 0
Steven J. LaSala (5) 45,000 45,000 0
Alfred Colanero (5) 1,000 1,000 0
Christopher Holland (5) 1,000 1,000 0
Sara Malowitz (5) 1,000 1,000 0
13
<PAGE>
Linda Carlino (5) 1,000 1,000 0
Renee A. LaSala (5) 1,000 1,000 0
Ronniel Levy (6) 12,000 12,000 0
Elliot H. Lutzker (6) 11,118 11,118 0
Jack Becker (6) 12,029 12,029 0
---------------------------
</TABLE>
(1) Pursuant to Rule 416 of the Securities Act, this prospectus also covers
such additional number of shares of common stock as may become issuable
upon exercise of the warrants held by the selling stockholders as a result
of stock splits, stock dividends and similar transactions.
(2) Assumes that all of the shares acquired upon exercise of the warrants held
by the selling stockholders covered by this prospectus are sold in the
offering.
(3) Represents warrants to purchase shares of our common stock at an exercise
price of $.01 per share issued for consulting services rendered pursuant to
a Consulting Agreement dated as of June 26, 2000. The consulting services
to be performed pursuant to the terms of this consulting agreement include
business due diligence review in connection with the analysis of
acquisition targets and/or potential strategic business partnering
arrangements. The warrants issued to these consultants do not vest and
become exercisable until the services to provided under this consulting
agreement have been performed.
(4) Represents shares of our common stock issued for legal services rendered on
our behalf pursuant to an Attorney-Client Engagement Letter dated as of May
9, 2000. The legal services rendered pursuant to this letter involved
certain litigation matters including the settlement of a dispute with our
financial printer.
(5) Represents shares of our common stock issued for accounting services
rendered on our behalf pursuant to an Engagement Letter dated as of June
12, 2000. The accounting services rendered pursuant to this letter included
the preparation of our 1999 corporate income tax returns and did not
include the audit or review of any of our financial statements.
(6) Represents shares of our common stock issued for legal services rendered on
our behalf pursuant to an Attorney Retainer Letter dated as of May 10,
2000. The legal services rendered pursuant to this letter included the
preparation and filing of our annual and quarterly reports with the
Securities and Exchange Commission.
USE OF PROCEEDS
We will receive the proceeds from the payment of the exercise price of
the warrants and these payments will be applied towards our working capital. We
will not receive any portion of the proceeds from the sale of the shares of
common stock held by the selling stockholders or the resale of the shares of
common stock acquired upon exercise of the warrants.
14
<PAGE>
PLAN OF DISTRIBUTION
We are registering the shares on behalf of the selling stockholders.
"Selling stockholders" as used in this prospectus, includes donees and pledgees
selling shares received from a named selling stockholder after the date of this
prospectus. No public market for our common stock currently exists and until
such time as a public market develops, the selling stockholders may offer their
shares of our common stock only in private transactions at negotiated prices.
However, in the event a public market for our common stock does develop and is
established, the selling stockholders may offer their shares of our common stock
at various times in one or more of the following types of transactions:
o in the over-the counter market;
o in private transactions other than in the over-the-counter
market;
o in connection with short sales of our shares;
o by pledge to secure debts and other obligations; or
o in a combination of any of the above transactions.
In a public market, the selling stockholders may sell their shares at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, at negotiated prices or at fixed prices.
In addition, the selling stockholders may use broker-dealers to sell
their shares in the public market. Sales through brokers or dealers may involve
one or more of the following:
o block trades in which the broker or dealer so engaged will
attempt to sell the selling stockholder's shares as agent
but may position and resell a portion of the block as
principal to facilitate the transaction;
o purchases by a broker or dealer as principal and resale by
such broker or dealer for its own account pursuant to this
prospectus; or
o ordinary brokerage transactions and transactions in which
the broker solicits purchasers.
If a broker or dealer is engaged by a selling stockholder, such broker or dealer
may either receive discounts or commission from the selling stockholders, or
they will receive commissions from purchasers of shares for whom they acted as
agents. Affiliates of one or more of the selling stockholders may act as
principals or agents in connection with the offer or sale of shares by selling
stockholders.
The number of shares that may be offered and sold pursuant to this
Prospectus by those selling stockholders currently holding shares of our common
stock may not exceed, in any three month period, the amount specified in Rule
144(e) of the Securities Act. Under Rule 144(e), these selling stockholders may
sell, during any three month period, a number of shares that does not exceed the
greater of 1% of the total number of outstanding shares of our common stock or,
if our common stock is quoted on an exchange or NASDAQ, the average weekly
trading volume during the four calendar weeks preceding the sale. The
limitations imposed by Rule 144(e) do apply to the sale of the shares of our
common stock issuable upon exercise of the warrants held by our selling
stockholders.
Selling stockholders have been advised that during the time each is
engaged in distribution of the securities covered by this Prospectus, to the
extent applicable, each must comply with Regulation M under the Securities
Exchange Act of 1934, as amended, and pursuant to such Regulation:
15
<PAGE>
o shall not engage in any stabilization activity in connection
with our securities;
o shall furnish each broker through which securities covered
by this Prospectus may be offered the number of copies of
this Prospectus which are required by each broker; and
o shall not bid for or purchase any of our securities or
attempt to induce any person to purchase any of our
securities other than as permitted under the Securities
Exchange Act of 1934, as amended.
LEGAL MATTERS
The validity of the shares offered by this prospectus will be passed
upon for us by Jeffer, Mangels, Butler & Marmaro LLP, Los Angeles, California.
EXPERTS
Our financial statements for the year ended December 31, 1999 and for
the period from October 6, 1998 (inception) to December 31, 1998 have been
included herein in reliance on the report of Singer Lewak Greenbaum & Goldstein
LLP, independent certified accountants, and upon the authority of that firm as
experts in accounting and auditing.
16
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. Our SEC filings
are available to the public over the Internet at the SEC's website at
http://www.sec.gov. You may read and copy any materials that we have filed with
the SEC at its Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. You can also obtain copies of the documents at prescribed rates by
writing to the Public Reference Section of the SEC at 450 Fifth Street, N.W.,
Washington, D.C. 20549. You can obtain information on the operation of the
Public Reference Room by calling the SEC at 1-800-SEC-0330.
This prospectus is part of a registration statement on Form S-8 that we
filed with the SEC and omits portions of the information contained in the
registration statement as permitted by the SEC. Additional information regarding
us and our common stock is contained in the registration statement. You can
obtain a copy of the registration statement from the SEC at the street address
or Internet site listed in the above paragraph.
The SEC allows us to "incorporate by reference" into this prospectus
the information we have filed with them. The information incorporated by
reference is an important part of this prospectus and the information that we
file subsequently with the SEC, will automatically update this prospectus. The
information incorporated by reference is considered to be a part of this
prospectus. We incorporate by reference the documents listed below and any
filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1933, as amended, after the initial filing of the
registration statement that contains this prospectus and prior to the time that
we sell all the securities offered by this prospectus:
o Our Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1999;
o Our Quarterly Report on Form 10-QSB for the quarter ended
March 31, 2000; and
o The description of the our common stock contained in our
Form 10-SB filed with the SEC on July 8, 1999, as amended by
our Form 10-SB/A Amendment Number 1 filed with the SEC on
September 20, 1999 and our Form 10-SB/A Amendment Number 2
filed with the SEC on December 20, 1999 (File No.
000-26627).;
A copy of these filings will be provided to you at no cost if you
request them by writing or telephoning us at the following address:
Mayall Partners, Inc.
317 Madison Avenue, Suite 2310
New York, New York 10017
Phone: (212) 949-9696
You should rely only on the information provided in this prospectus. We
have not authorized anyone to provide you with information that is different. We
are not making an offer of these securities in any jurisdiction where the offer
is not permitted. You should not assume that the information in this prospectus
is accurate as of any date other than the date on the front of this document.
17
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The Registrant hereby incorporates by reference in this Registration
Statement the following documents filed with the Commission by the Registrant:
(a) The Registrant's Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1999;
(b) The Registrant's Quarterly Report on Form 10-QSB for the
quarter ended March 31, 2000; and
(c) The description of the Registrant's Common Stock Contained
in Registrant's Form 10-SB filed with the Commission on July
8, 1999, as amended by Registrant's Form 10-SB/A Amendment
Number 1 filed with the Commission on September 20, 1999 and
Registrant's Form 10-SB/A Amendment Number 2 filed with the
Commission on December 20, 1999 (File No. 000-26627).
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") prior to the filing of a post-effective amendment to this
Registration Statement which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference herein by the Registrant and to be a part hereof
from the date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein by the Registrant
shall be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or in any other
subsequently filed document which also is incorporated or deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities
Not applicable.
Item 5. Interests of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
The Registrant's Certificate of Incorporation (the "Certificate") and
Bylaws include provisions that eliminate the directors' personal liability for
monetary damages to the fullest extent possible under Delaware Law or other
applicable law (the "Director Liability Provision"). The Director Liability
Provision eliminates the liability of directors to the Registrant and its
stockholders for monetary damages arising out of any violation by a director of
his fiduciary duty of due care. Under Delaware Law, however, the Director
Liability Provision does not eliminate the personal liability of a director for
(i) breach of the director's duty of loyalty, (ii) acts or omissions not in good
faith or involving intentional misconduct or knowing violation of law, (iii)
payment of dividends or repurchases or redemptions of stock other than from
lawfully available funds, or any
II-1
<PAGE>
transaction from which the director derived an improper benefit. Furthermore,
pursuant to Delaware Law, the limitation on liability afforded by the Director
Liability Provision does not eliminate a director's personal liability for
breach of the director's duty of due care. Although the directors would not be
liable for monetary damages to the corporation or its stockholders for negligent
acts or omissions in exercising their duty of due care, the directors remain
subject to equitable remedies, such as actions for injunction or rescission,
although these remedies, whether as a result of timeliness or otherwise, may not
be effective in all situations. With regard to directors who also are officers
of the Registrant, these persons would be insulated from liability only with
respect to their conduct as directors and would not be insulated from liability
for acts or omissions in their capacity as officers.
Delaware Law provides a detailed statutory framework covering
indemnification of directors, officers, employees or agents of the Registrant
against liabilities and expenses arising out of legal proceedings brought
against them by reason of their status or service as directors, officers,
employees or agents. Section 145 of the Delaware General Corporation Law
("Section 145") provides that a director, officer, employee or agent of a
corporation (I) shall be indemnified by the corporation for expenses actually
and reasonably incurred in defense of any action or proceeding if such person is
sued by reason of his service to the corporation, to the extent that such person
has been successful in defense of such action or proceeding, or in defense of
any claim, issue or matter raised in such litigation, (ii) may, in actions other
than actions by or in the right of the corporation (such as derivative
actions),be indemnified for expenses actually and reasonably incurred,
judgments, fines and amounts paid in settlement of such litigation, even if he
is not successful on the merits, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation (and in a criminal proceeding, if he did not have reasonable cause
to believe his conduct was unlawful), and (iii) may be indemnified by the
corporation for expenses actually and reasonably incurred (but not judgments or
settlements) of any action by the corporation or of a derivative action (such as
a suit by a stockholder alleging a breach by the director or officer of a duty
owed to the corporation), even if he is not successful, provided that he acted
in good faith and in a manner reasonably believed to be in or not opposed to the
best interests of the corporation, provided that no indemnification is permitted
without court approval if the director has been adjudged liable to the
corporation.
Delaware Law also permits a corporation to elect to indemnify its
officers, directors, employees and agents under a broader range of circumstances
than that provided under Section 145. The Certificate contains a provision that
takes full advantage of the permissive Delaware indemnification laws (the
"Indemnification Provision") and provides that the Registrant is required to
indemnify its officers, directors, employees and agents to the fullest extent
permitted by law, including those circumstances in which indemnification would
otherwise be discretionary, provided, however, that prior to making such
discretionary indemnification, the Registrant must determine that the person
acted in good faith and in a manner he or she believed to be in the best
interests of the Registrant and, in the case of any criminal action or
proceeding, the person had no reason to believe his or her conduct was unlawful.
In furtherance of the objectives of the Indemnification Provision, the
Registrant may also enter into agreements to indemnify its directors and
executive officers, in addition to the indemnification provided for in the
Registrant's Certificate and Bylaws. The Registrant believes that such
indemnification agreements are necessary to attract and retain qualified
directors and executive officers.
The inclusion of provisions limiting liability of the Registrant's
officers and directors may have the effect of reducing the likelihood of
derivative litigation against the officers and directors and may discourage or
deter stockholders or management from bringing a lawsuit against the officers
and directors for breach of their duty of care, even though such an action, if
successful, might otherwise have benefitted the Registrant and its stockholders.
Item 7. Exemption from Registration Claimed
II-2
<PAGE>
The 125,147 shares of common stock issued to the selling stockholders
were issued pursuant to Section 4(2) of the Securities Act and as such,
represent "restricted securities" as defined in Rule 144 under the Securities
Act. All of these share were issued to key consultants of the Registrant who are
intimately familiar with the Registrant and its business, operations and
financial condition. In addition, each of these consultants has had access to
the Registrant's Registration Statement on Form 10-SB, including amendments
thereto, as well as the Registrant's subsequently filed annual and quarterly
reports.
Item 8. Exhibits
The Exhibit Index immediately preceding the exhibits is incorporated
herein by reference.
Item 9. Undertakings
The undersigned Registrant hereby undertakes:
(a) (1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement; and
(iii)To include any additional or changed material information
with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(I) and (a)(1)(ii)
do not apply if the Registration Statement is on Form S-3 or
Form S-8 and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission
by the Registrant pursuant to Section 13 or Section 13(d) of
the Exchange Act that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in
the opinion of the Commission 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 the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
II-3
<PAGE>
precedent, submit to a court of appropriate jurisdiction the
question whether such indemnifica tion by it is against public
policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on the 18th day of July,
2000.
Mayall Partners, Inc.
By /s/ James A. Prestiano
-------------------------------------
James A. Prestiano, President,
Secretary and Chief Financial Officer
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities and on the
date indicated.
Date: July 18, 2000 /s/ James A. Prestiano
-------------------------------------
James A. Prestiano, President,
Secretary and Chief Financial Officer
and Sole Director
II-5
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
------ -----------
4.1 Consulting Agreement dated as of June 26, 2000 between the
Registrant and CMI.
4.2 Form of Warrant Agreement
5.1 Opinion of counsel as to legality of securities being registered
23.1 Consent of Singer Lewak Greenbaum & Goldstein LLP
23.2 Consent of Jeffer, Mangels, Butler & Marmaro LLP (included in
Exhibit 5)
---------------
II-6
