<PAGE> 1
As filed with the Securities and Exchange Commission on June 30, 2000
Registration No. 333-____
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SECURITIES AND EXCHANGE COMMISSION
--------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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QUEPASA.COM, INC.
(Exact name of registrant as specified in its charter)
NEVADA 86-0879433
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
GARY L. TRUJILLO
QUEPASA.COM, INC.
400 E. VAN BUREN, FOURTH FLOOR
PHOENIX, AZ 85004
(602) 716-0100
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
--------------------------
COPY TO:
JEFFREY M. KNETSCH
BROWNSTEIN HYATT & FARBER, P.C.
410 SEVENTEENTH STREET, 22ND FLOOR
DENVER, COLORADO 80202
(303) 223-1100
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Approximate date of commencement of proposed sale to public: as soon as
practicable after the registration statement becomes effective.
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 under 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 earliest 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>
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Proposed Maximum Proposed Maximum
Title of Each Class of Amount to be Offering Price Aggregate Offering Amount of
Securities to be Registered Registered (1) per Unit (2) Price Registration Fee
---------------------------------- ------------------ -------------------- ---------------------- -------------------
<S> <C> <C> <C> <C>
Common Stock, $0.001 par value 1,428,571 $1.6875 $2,410,713.56 $636.43
=====================================================================================================================
</TABLE>
(1) Pursuant to Rule 416, the Registrant is also registering such
indeterminate number of additional shares of Common Stock as may be
issuable by reason of stock dividends, stock splits, or similar
transactions.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933, as amended,
based on the high and low prices of the Common Stock of the Registrant
as reported on the Nasdaq National Market on June 29, 2000.
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
will thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933, as amended, or until the registration statement shall
become effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
<PAGE> 2
The information in this prospectus is not complete and may be changed. The
selling stockholder 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 it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
PROSPECTUS
QUEPASA.COM, INC.
1,428,571 SHARES OF COMMON STOCK
You should read this prospectus carefully before you invest. Gateway
Companies, Inc. may offer and sell up to 1,428,571 shares of our common stock
under this prospectus for its own account. quepasa.com, inc. will not receive
any proceeds from the sale of these shares by Gateway.
The selling stockholder may offer its common stock through public or
private transactions, at prevailing market prices or at privately negotiated
prices. Those future prices are not currently known.
quepasa.com, inc. common stock is traded on the Nasdaq National Market
under the trading symbol "PASA." On June 29, 2000, the last reported sale price
for the common stock on the Nasdaq National Market was $1.625 per share.
See "Risk Factors" beginning on page 2 to read about factors you should
consider before buying shares of our common stock.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY
BODY HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
------------------------
The date of this prospectus is June ___, 2000.
<PAGE> 3
RECENT EVENTS
On May 9, 2000, we announced that we would be reducing our workforce by
approximately one-third over a 60 day period as part of management's effort to
enhance our competitive position and utilize our limited capital and assets more
efficiently. Management's additional cost cutting measures have included
reductions in advertising and general and administrative expenditures.
On May 26, 2000, we announced that we retained the investment banking
firm of Friedman, Billings, Ramsey & Co., Inc. to further enhance our
competitive position and maximize shareholder value. Friedman, Billings has been
authorized to consider a number of strategic alternatives for us, including
strategic alliances, significant equity investments in our company, and a merger
or the sale of our company or significant portions of our business. No decision
has been made at this time to pursue any particular transaction.
RISK FACTORS
You should carefully consider the risks described below before making
an investment decision.
OUR OPERATING HISTORY IS EXTREMELY LIMITED
We were incorporated in June 1997 and have generated no significant
revenue to date. Accordingly, we have no operating history upon which an
investor can evaluate us, and our prospects are subject to the risks and
uncertainties encountered by companies that are in the early stages of operation
and particularly companies which operate in the new and rapidly evolving
Internet market.
These risks include, among others, our ability to:
o expand the contents and services on our Web site;
o maintain and increase levels of traffic on our Web site;
o increase awareness of our quepasa.com brand;
o attract advertisers and sponsors to our Web site;
o generate significant revenue from e-commerce;
o respond effectively to competitive pressure;
o maintain our current, and develop new, strategic relationships;
o recruit and retain personnel, including sales, content and technology
personnel;
o anticipate and adapt to developing markets;
o upgrade and develop our systems and infrastructure;
o respond to any failure of our network and to handle efficiently our Web
traffic; and
o manage our rapidly expanding operations.
If we are unsuccessful in addressing these and other risks, our
business, condition and results of operations will be materially and adversely
affected.
WE EXPECT FUTURE LOSSES AND WILL NEED MORE CAPITAL
We have never been profitable. As of December 31, 1999, we had an
accumulated deficit of approximately $35.8 million. Our limited operating
history and the uncertainty of the Internet market in which we operate our
business make any prediction of our future results of operations difficult or
impossible. We expect our expenses to increase from the distribution agreement
with NetZero, Inc. and from the acquisitions of eTrato.com, credito.com and
RealEstateEspanol.com. We do not expect that our revenue will cover our expenses
in the foreseeable future. As a result, we will continue to incur significant
losses and will need to raise additional capital. In addition, because we have
generated negligible revenue and have incurred significant operating losses to
date we have reduced our workforce by approximately one-third over the past 60
days in order to utilize our limited capital and assets more efficiently. As a
result of the reduction in our workforce, our ability to execute our business
plan and our business may be materially and adversely affected. Further, in the
event we fail to generate improved revenue in the near future, we may be
required to further reduce our workforce, curtail our operations and raise
additional capital. We
<PAGE> 4
believe that our cash on hand, along with our planned cost cutting measures,
will be sufficient to meet our working capital and capital expenditure needs
through the second quarter of 2001, however, we believe it will be necessary for
us to raise additional capital to ensure our continued operations beyond the
second quarter of 2001. In the event we are not able to raise capital, our
ability to continue operations will be severely impacted and could include a
significant reduction in our advertising spending, a reduction in our personnel
and other spending cuts which could have an adverse effect on the quepasa. We
cannot assure that we will be able to raise additional capital and we do not
know what the terms of such capital raising would be. Any future sale of our
equity securities would dilute the ownership and control of our stockholders.
IF WE FAIL TO CONSUMMATE A STRATEGIC BUSINESS TRANSACTION, OUR BUSINESS AND OUR
CONTINUED VIABILITY MAY BE ADVERSELY AFFECTED
We have retained the investment banking firm of Friedman, Billings,
Ramsey & Co., Inc. to consider strategic business alternatives in an effort to
further enhance our competitive position and maximize shareholder value.
Friedman, Billings has been authorized to consider a number of strategic
alternatives including strategic alliances, significant equity investments in
our company, and a merger or the sale of our company or significant portions of
our business. There is no assurance that any transaction will be consummated or
that any transaction that is approved and consummated will effectively enhance
our competitive position or maximize shareholder value. If we are unable to
consummate an acceptable strategic business transaction, our business and our
continued viability may be materially and adversely affected.
WE ARE SUBJECT TO RISKS ASSOCIATED WITH ACQUISITIONS
In the first quarter of 2000, we acquired the stock of three companies.
As part of our long-term business strategy, we continually evaluate strategic
acquisitions of businesses. Acquisitions often involve a number of special
risks, including the following:
o we may experience difficulty integrating acquired operations and personnel;
o we may be unable to retain acquired subscribers;
o the acquisition may disrupt our ongoing business;
o we may not be able to successfully incorporate acquired technology and rights
into our offerings and maintain uniform standards, controls, procedures, and
policies;
o the businesses we acquire may fail to achieve the revenue and earnings we
anticipated;
o we may ultimately be liable for contingent and other liabilities, not
previously disclosed to us, of the companies that we acquire; and
o our resources may be diverted in asserting and defending our legal rights.
We may not successfully overcome problems encountered in connection
with our recent and potential future acquisitions. In addition, an acquisition
could materially adversely affect our operating results by:
o causing us to incur additional debt;
o requiring us to amortize expenses related to goodwill and other intangible
assets; and
o diluting our stockholders' ownership interest.
WE WILL BE UNABLE TO GENERATE SUFFICIENT REVENUE IF OUR TARGET AUDIENCE DOES NOT
ACCEPT OUR PRODUCTS AND SERVICES
We have been promoting our site for less than one year and we cannot
give assurances that the Spanish-speaking population will accept our products
and services or that we will attract repeat users to our Web site. Because the
market for our products and services is new and evolving, it is difficult to
predict the future growth rate, if any, and the size of the market we have
targeted. If the market develops more slowly than we expect or becomes saturated
with competitors, or if our products and services are not accepted by the
market, we will be unable to generate enough revenue to offset our expenses and
to earn profits.
<PAGE> 5
OUR INABILITY TO DEVELOP THE QUEPASA.COM BRAND WILL SIGNIFICANTLY REDUCE OUR
REVENUE
We believe that maintaining the quepasa.com brand is of critical
importance to our efforts to attract and expand our user base and our
advertising, sponsorships and e-commerce revenue. We also believe that brand
recognition will become more important due to the increasing number of Internet
sites. Promotion and enhancement of the quepasa.com brand will depend largely on
our success in providing high quality products and services and Web site content
that is of interest to the worldwide Spanish-speaking population. We cannot
assure that success. Even if our desired results are achieved, it is likely that
we will expend significant additional amounts in further developing and
maintaining brand loyalty. Failure to develop brand loyalty among our users
could result in our being unable to generate enough revenue to offset our
expenses and to earn profits.
WE WILL BE ADVERSELY AFFECTED IF THE INTERNET DOES NOT BECOME WIDELY ACCEPTED AS
A MEDIUM FOR ADVERTISING AND E-COMMERCE
We will need revenue from the sale of advertisements and sponsorships
on our Web pages and from e-commerce transactions to offset expenses. At the
present time, Web advertisers generally enter into only short-term advertising
contracts. Because Web site advertising is a new phenomenon, few advertisers
have significant experience with the Web as an advertising medium. Consequently,
many advertisers have not devoted a substantial portion of their advertising
expenditures to Web-based advertising, and may not find Web-based advertising to
be effective for promoting their products and services as compared to
traditional print and broadcast media.
No standards have yet been widely accepted for the measurement of the
effectiveness of Web-based advertising, and we can give no assurance that such
standards will be developed or adopted sufficiently to sustain Web-based
advertising as a significant advertising medium. We cannot give assurances that
banner advertising, the predominant revenue producing mode of advertising
currently used on the Web, will be accepted as an effective advertising medium
or that we can effectively transition to any other forms of Web-based
advertising, should they develop. Software programs are available that limit or
remove advertisements from an Internet user's desktop. This software, if
generally adopted by users, may materially and adversely affect Web-based
advertising.
OUR WEB SITE OPERATIONS COULD BE IMPAIRED IF WE LOSE THE SERVICES OF THIRD PARTY
TECHNOLOGY AND CONTENT PROVIDERS
Our business depends upon third parties, including providers of
technology, infrastructure, content and features. We supplement our Web site
directory listings with Web search results provided by Inktomi under a
non-exclusive agreement. We depend upon Inktomi for ongoing maintenance and
technical support to ensure accurate and rapid presentation of search results to
users of our Web site. Termination of our relationship with Inktomi or Inktomi's
failure to renew our agreement upon expiration could result in substantial
additional costs to us in developing or replacing technology. We also rely on
GTE for our Internet and Critical Path for our e-mail connections. Any
interruption in the Internet access provided by GTE or any other provider of
access could disrupt our Web site operations and impair relations with our
users.
We license content, including technology and related databases, from
third parties for portions of our quepasa.com Web site, including news from
Associated Press, Reuters, Hispanic Business and EFE News Services, weather from
WeatherLabs, stock quotes and other stock information from Zacks Investment
Research and sports scores and statistics from STATS, Inc. Any errors, delays or
failures experienced in connection with these third party technologies and
services could have a negative effect on our relationship with users of our Web
site, could materially and adversely affect our brand and our business and could
subject us to liability to third parties for business negligence such as
defamation or libel.
SYSTEM FAILURE COULD DISRUPT OUR WEB SITE OPERATIONS
The continued and uninterrupted performance of our hardware and
software is critical to our reputation and our success in attracting traffic to
our Web site. Users of our site and our services, such as our e-mail services,
may become dissatisfied by system failures that may limit our Web site services.
Sustained or repeated system failures could significantly reduce the traffic on
our Web site and may impair our reputation and brand name. Our operations depend
on our ability to protect our computer systems from damage from fire, power
loss, water damage, telecommunications failures, vandalism and other malicious
acts, and similar unexpected adverse events.
<PAGE> 6
The number of pages of information transmitted over our network,
commonly referred to as "page views," has continued to increase over time. We
are actively trying to increase our level of page views. As a result, our
network must accommodate a high volume of traffic, often at unexpected times. We
have experienced periodic capacity constraints in terms of our ability to serve
our increasing user volumes. In addition, we have had reliability problems with
two of our internally developed applications, chat and e-mail, and as a result
we are currently outsourcing these two applications. We are in the process of
improving our network infrastructure to ensure that we will be able to handle
future increases in traffic. We have migrated our platform and our applications
to a Unix platform using Sun Microsystems servers. Any break in the continuous
operations of our network could have a material adverse effect on our operating
expenses, our brand and our business.
We may, from time to time, experience interruptions due to several
factors including hardware failures, unsolicited bulk e-mail and operating
system failures. Because our revenue depends on the number of users of our
network, we will be adversely affected if we experience frequent or long system
delays or interruptions. If delays or interruptions continue to occur our users
could perceive our network as being unreliable, traffic on our Web site could
deteriorate and our brand could be adversely affected. Any failure on our part
to minimize or prevent capacity constraints or system interruptions could have
an adverse effect on our brand and our business.
We may not carry enough business interruption insurance to compensate
for losses that may occur as a result of any of these adverse events. We also
depend upon Internet browsers and Internet service providers that provide users
with access to the Internet and our Web site. Users may experience difficulties
due to system failures unrelated to our systems. Any disruption in Internet
access by Internet service providers and other third party access providers, or
any failure of such providers to handle higher volumes of user traffic, could
disrupt our Web site operations and impair relations with our users.
OUR MANAGEMENT IS INEXPERIENCED AND MAY NOT BE ABLE TO MANAGE OUR GROWTH
Several executive officers and members of our board of directors joined
us in 1999, our management team has worked together for less than a year and
none of our executive officers has extensive experience managing a rapidly
growing business enterprise. Any growth we experience will place a significant
strain on our management and financial resources. Any inability of our
management to manage growth effectively could increase our operating expenses,
impair our marketing efforts and limit the development of our Web site.
GROWTH OF OUR WEB SITE MAY BE LIMITED BY GOVERNMENTAL REGULATIONS
Government regulation has not materially restricted use of the Internet
in our markets to date. However, the legal and regulatory environment pertaining
to the Internet remains relatively undeveloped and may change. New laws and
regulations could be adopted, and existing laws and regulations could be applied
to the Internet and, in particular, to e-commerce. New laws and regulations may
be adopted with respect to the Internet covering, among other things, sales and
other taxes, user privacy, pricing controls, characteristics and quality of
products and services, consumer protection, cross-border commerce, libel and
defamation, intellectual property matters and other claims based on the nature
and content of Internet materials. Any laws or regulations adopted in the future
affecting the Internet could subject us to substantial liability. Such laws or
regulations could also adversely affect the growth of the Internet generally,
and decrease the acceptance of the Internet as a communications and commercial
medium. In addition, the growing use of the Internet has burdened the existing
telecommunications infrastructure. Areas with high Internet use relative to the
existing telecommunications structure have experienced interruptions in phone
service leading local telephone carriers to petition regulators to govern
Internet service providers and impose access fees on them. Such regulations, if
adopted in the United States or other places, could increase significantly the
costs of communicating over the Internet, which could in turn decrease the
demand for our products and services. The adoption of various proposals to
impose additional taxes on the sale of goods and services through the Internet
could also reduce the demand for Web-based commerce.
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WE MAY FACE LIABILITY FOR INFORMATION CONTENT AND COMMERCE-RELATED ACTIVITIES
Because materials may be downloaded by the services that we operate or
facilitate and the materials may subsequently be distributed to others, we could
face claims for errors, defamation, negligence, or copyright or trademark
infringement based on the nature and content of such materials. We could also be
exposed to liability because of the listings that we select and make available
through our Web site, or through content and materials posted by users in chat
room and message board services that we provide. We could face personal injury
or other product liability claims arising from the use of products sold through
our Web site. We offer e-mail services, which expose us to potential liabilities
or claims resulting from unsolicited e-mail, lost or misdirected messages,
illegal or fraudulent use of e-mail or interruptions or delays in e-mail
service. Even to the extent that claims made against us do not result in
liability, we may incur substantial costs in investigating and defending such
claims.
Although we carry general liability insurance, our insurance may not
cover all potential claims to which we are exposed or may not be adequate to
indemnify us for all liabilities that may be imposed. Any imposition of
liability that is not covered by insurance or is in excess of insurance coverage
could have a material adverse effect on our financial condition. In addition,
the increased attention focused on liability issues as a result of these
lawsuits and legislative proposals could impact the overall growth of Internet
use.
CONCERNS ABOUT SECURITY OF E-COMMERCE TRANSACTIONS AND CONFIDENTIALITY OF
INFORMATION ON THE INTERNET MAY REDUCE THE USE OF OUR WEB SITE AND IMPEDE OUR
GROWTH
A significant barrier to e-commerce and confidential communications
over the Internet has been the need for security. Internet usage could decline
if any well-publicized compromise of security occurred. We may incur significant
costs to protect against the threat of security breaches or to alleviate
problems caused by these breaches. Unauthorized persons could attempt to
penetrate our network security. If successful, they could misappropriate
proprietary information or cause interruptions in our services. As a result, we
may be required to expend capital and resources to protect against or to
alleviate these problems. Security breaches could have a material adverse effect
on our business, financial condition and results of operations.
COMPETITION FOR INTERNET USERS MAY LIMIT TRAFFIC ON, AND THE VALUE OF, OUR WEB
SITE
The market for Internet products and services and the market for
Internet advertising and electronic commerce arrangements are extremely
competitive, and we expect that competition will continue to intensify. There
are many companies that provide Web sites and online destinations targeted to
Spanish-language Internet users. Competition for visitors, advertisers and
e-commerce partners is intense and is expected to increase significantly in the
future because there are no substantial barriers to entry in our market. We
believe that the principal competitive factors in these markets are name
recognition, distribution arrangements, functionality, performance, ease of use,
the number of services and features provided and the quality of support. Our
primary competitors are other companies providing portal or other online
services, especially to Spanish-language Internet users such as StarMedia, Terra
Network, El Sitio, Yahoo! Espanol, America Online Latin America, Yupi, Prodigy
and Microsoft networks in Latin America, Mexico and Spain. Most of our
competitors, as well as a number of potential new competitors, have
significantly greater financial, technical and marketing resources than we do.
Our competitors may offer Internet products and services that are superior to
ours or that achieve greater market acceptance. There can be no assurance that
competition will not limit traffic on, and the value of, our Web site.
TECHNOLOGICAL CHANGES COULD IMPAIR OUR ABILITY TO COMPETE AND SUBJECT US TO
SIGNIFICANT EXPENDITURES
The market for Internet products and services is characterized by rapid
technological developments, frequent new product and service introductions and
evolving industry standards. The emerging character of these products and
services and their rapid evolution will require that we continually improve the
performance, features and reliability of our Internet content, particularly in
response to competitive offerings. There can be no assurance that we will be
successful in responding quickly, cost effectively and sufficiently to these
developments. In addition, the widespread adoption of new Internet technologies
or standards could require substantial expenditures by us to modify or adapt our
Web site and services and could fundamentally affect the character, viability
and frequency of Web-based advertising, either of which could have a material
adverse effect on our business. In addition, new Internet services or
enhancements offered by us may contain design flaws or other defects that could
require costly modifications or result in a loss of consumer confidence.
<PAGE> 8
OUR STOCK PRICE IS HIGHLY VOLATILE
In the past, our common stock has traded at volatile prices. We believe
that the market prices will continue to be subject to significant fluctuations
due to various factors and events that may or may not be related to our
performance. If the market value of our common stock decreased substantially, we
could be delisted from the Nasdaq National Market. Consequently, you could find
it difficult or impossible to sell your stock or to determine the value of your
stock.
In addition, the stock market has from time to time experienced
significant price and volume fluctuations, which have particularly affected the
market prices of the stocks of Internet-sector companies and which may be
unrelated to the operating performance of such companies. Furthermore, our
operating results and prospects from time to time may be below the expectations
of public market analysts and investors. Any such event could result in a
material decline in the price of your stock.
WE HAVE NO INTENTION TO PAY DIVIDENDS
We have never paid any cash dividends on our common stock. We currently
intend to retain all future earnings, if any, for use in our business and do not
expect to pay any dividends in the foreseeable future.
FUTURE SALES OF OUR COMMON STOCK OR SHARES ISSUABLE UPON EXERCISE OF STOCK
OPTIONS COULD ADVERSELY AFFECT OUR STOCK PRICE AND OUR ABILITY TO RAISE FUNDS IN
NEW STOCK OFFERINGS
As of the date of this filing, we have 18,850,805 shares of common
stock outstanding. Sale of substantial amounts of common stock, or the
perception that sales could occur, could reduce the market price of the common
stock. Currently, there are outstanding stock options or common stock purchase
warrants to acquire 6,226,689 shares of common stock at exercise prices ranging
from $1 to $19.80 per share, including 2,565,313 common stock purchase warrants
subject to demand and piggy-back registration rights.
FORWARD-LOOKING STATEMENTS MAY BE UNRELIABLE
This prospectus and the information incorporated by reference may
include "forward-looking statements" within the meaning of Section 27A of the
Securities Act and Section 21E of the Exchange Act. We intend the
forward-looking statements to be covered by the safe harbor provisions for
forward-looking statements in these sections. All statements regarding our
expected financial position and operating results, our business strategy, our
financing plans and the outcome of any contingencies are forward-looking
statements. These statements can sometimes be identified by our use of
forward-looking words such as "may," "believe," "plan," "will," "anticipate,"
"estimate," "expect," "intend" and other phrases of similar meaning. Known and
unknown risks, uncertainties and other factors could cause the actual results to
differ materially from those contemplated by the statements. The forward-looking
information is based on various factors and was derived using numerous
assumptions.
Although we believe that our expectations expressed in these
forward-looking statements are reasonable, we cannot promise that our
expectations will turn out to be correct. Our actual results could be materially
different from our expectations.
DESCRIPTION OF COMMON STOCK
The description of our common stock, $0.001 par value, is included in
our Registration Statement on Form 8-A, which was filed with the Securities and
Exchange Commission on March 16, 1999. We have incorporated our Registration
Statement on Form 8-A by reference. As of June 30, 2000 we have 18,850,805
shares of common stock issued and outstanding.
<PAGE> 9
SELLING STOCKHOLDER
The following table sets forth information regarding the ownership of
our common stock by the selling stockholder and the maximum number of shares
that may be sold pursuant to this prospectus. The selling stockholder listed
below may use this prospectus to sell its common stock.
<TABLE>
<CAPTION>
Shares Which Shares Owned After
Number of Shares May be Sold Offering
Owned Before Pursuant to this ------------------------------
Selling Stockholder the Offering Prospectus Number Percentage
------------------------------------ -------------------- ------------------- ------------ -------------
<S> <C> <C> <C> <C>
Gateway Companies, Inc. 1,428,571 1,428,571 0 0
</TABLE>
Neither the selling stockholder, nor its officers, directors or major
shareholders, has held any material relationship with our company or any of our
affiliates within the past three years other than as an owner of our securities.
PLAN OF DISTRIBUTION
The common stock covered by this prospectus may be offered and sold
from time to time by the selling stockholder in one or more of the following
transactions:
o on the Nasdaq National Market;
o in the over-the-counter market;
o in transactions other than on the Nasdaq National Market or in the
over-the-counter market;
o through brokers or dealers, or in direct transactions with
purchasers;
o in connection with short sales;
o by pledge to secure debts and other obligations;
o in connection with the writing of options, in hedge transactions,
and in settlement of other transactions in standardized or
over-the-counter options; or
o in a combination of any of the above transactions.
The selling stockholder may sell its shares at prevailing market
prices, at prices related to prevailing market prices, at negotiated prices, or
at fixed prices. There is no assurance that the selling stockholder will sell
any or all of its common stock. Brokers and dealers that are used will either
receive discounts or commissions from the selling stockholder, and/or will
receive commissions from the purchasers.
The selling stockholder may also elect to sell its shares pursuant to
Rule 144 under the Securities Act of 1933.
We have agreed to indemnify the selling stockholder against certain
liabilities, including liabilities arising under the Securities Act of 1933.
<PAGE> 10
LEGAL OPINION
For the purposes of this offering, Brownstein Hyatt & Farber, P.C. has
given its opinion as to the validity of the shares offered by the selling
stockholder.
EXPERTS
The financial statements of quepasa.com, inc. as of December 31,1999
and for the year then ended have been incorporated by reference herein and in
the registration statement in reliance upon the report of KPMG LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
Ehrhardt Keefe Steiner & Hottman, P.C., independent auditors, have
audited our consolidated financial statements and schedule for the year ended
December 31, 1998 included in our Annual Report on Form 10-K for the year ended
December 31, 1999, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements and schedule are incorporated by reference in reliance on
Ehrhardt Keefe Steiner & Hottman's report, given on their authority as experts
in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements, and
other information with the SEC. Our SEC filings are available to the public over
the Internet at the SEC's web site at www.sec.gov. You may also read and copy
any document we file at the SEC's Public Reference Rooms in Washington, D.C.,
New York, New York and Chicago, Illinois. The Public Reference Room in
Washington, D.C. is located at 450 Fifth Street, N.W. Please call the SEC at
1-800-SEC-0330 for further information on the Public Reference Rooms.
Our common stock is listed on the Nasdaq National Market. Reports,
proxy statements, and other information concerning us can be reviewed at the
offices of Nasdaq Operations, 1735 "K" Street, N.W., Washington, D.C. 20006.
The SEC allows us to "incorporate by reference" the information we file
with it, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We incorporate
by reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of
1934:
o Annual Report on Form 10-K for the year ended December 31, 1999;
o Quarterly Report on Form 10-Q for the quarter ended March 31,
2000;
o Current Reports on Form 8-K (and amendments) originally filed
January 21, January 28, February 11, March 17, April 14, and June
14, 2000;
o Definitive Proxy Statement for the 2000 Annual Meeting of
Stockholders; and
o The description of our common stock contained in our registration
statement on Form 8-A filed March 16, 1999.
We have also filed a registration statement on Form S-3 with the SEC under the
Securities Act of 1933. This prospectus does not contain all of the information
set forth in the registration statement. You should read the registration
<PAGE> 11
statement for further information about our company and our common stock. You
may request a copy of these filings at no cost. Please direct your requests to:
Juan Galan
Chief Financial Officer
quepasa.com, inc.
400 East Van Buren, Fourth Floor
Phoenix, Arizona 85004
(602) 716-0100
You may also want to refer to our web site at www.quepasa.com. Our web site is
not a part of this prospectus.
You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. quepasa.com and the
selling stockholders are not making an offer of our common stock in any state
where the offer is not permitted. You should not assume that the information in
this prospectus or any prospectus supplement is accurate as of any date other
than the date on the front page of those documents.
<PAGE> 12
TABLE OF CONTENTS
<TABLE>
<S> <C>
RECENT EVENTS.....................................................................................................2
RISK FACTORS......................................................................................................2
DESCRIPTION OF COMMON STOCK.......................................................................................7
SELLING STOCKHOLDER...............................................................................................8
PLAN OF DISTRIBUTION..............................................................................................8
LEGAL OPINION.....................................................................................................9
EXPERTS...........................................................................................................9
WHERE YOU CAN FIND MORE INFORMATION...............................................................................9
</TABLE>
COMMON STOCK
$0.001 PAR VALUE
QUEPASA.COM, INC.
PROSPECTUS
June ___, 2000
<PAGE> 13
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following expenses incurred in connection with the sale of the
securities being registered will be borne by the Registrant. Other than the SEC
registration fee and Nasdaq filing fee, the amounts stated are estimates.
<TABLE>
<S> <C>
SEC Registration Fee $ 636.43
Nasdaq Filing Fee 14,285.71
Printing and Engraving 1,000.00
Legal Fees and Expenses 10,000.00
Accounting Fees and Expenses 15,000.00
Miscellaneous 3,000.00
-----------
TOTAL $43,922.14
===========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's Articles of Incorporation, as amended (the
"Articles"), provide that the liability of the registrant's directors for
monetary damages for breach of fiduciary duty is eliminated to the fullest
extent permitted by Nevada law, and that the Registrant's officers and directors
shall be indemnified by the Registrant against any liability to the fullest
extent permitted by Nevada law. Insofar as indemnification for liabilities
arising under the Securities Act may be permitted to directors, officers or
persons controlling the registrant pursuant to the foregoing provisions, the
registrant has been informed that in the opinion of the Commission, such
indemnification is against public policy as expressed in the Securities Act and
is therefore unenforceable.
The Registrant's Amended and Restated Bylaws ("the Bylaws") provide
that the Registrant shall indemnify the current acting and former directors,
officers, employees and agents of the Registrant or another corporation,
partnership, joint venture, trust, association or other enterprise against
reasonably incurred expenses, judgments, penalties, fines, and amounts paid in
settlement reasonably incurred by him in connection with such action, suit or
proceeding if it is determined that such person reasonably believed (i) in the
case of conduct in his official capacity with the Registrant, that his conduct
was in the Registrant's best interests, or, (ii) in all other cases (except
criminal cases), that his conduct was at least not opposed to the Registrant's
best interests, or (iii) in the case of any criminal proceeding, that he had no
reasonable cause to believe his conduct was unlawful.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------- -----------------------
<S> <C>
3.01 Articles of Incorporation, as amended (1)
3.02 Amended and Restated Bylaws (1)
5.01 Opinion of Brownstein Hyatt & Farber, P.C. *
10.01 Stock Purchase and Investor Rights Agreement between the Registrant and Gateway Companies, Inc. (2)
23.01 Consent of KPMG LLP *
23.02 Consent of Ehrhardt Keefe Steiner & Hottman, P.C. *
23.03 Consent of Brownstein Hyatt & Farber, P.C. (included in Exhibit 5.01)
</TABLE>
-------------------
* Filed herewith.
(1) Incorporated by reference from the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1999.
(2) Incorporated by reference from the Registrant's Current Report on Form 8-K
(as amended) originally filed March 30, 2000.
<PAGE> 14
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if 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 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the 1934 Act)
that is incorporated by reference in the registration statement shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant 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
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Phoenix, State of Arizona, on June 30, 2000.
quepasa.com, inc.,
a Nevada Corporation
By: /s/ Gary L. Trujillo
------------------------------------
Name: Gary L. Trujillo
Title: Chairman and Chief Executive
Officer (Principal Executive
Officer)
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Gary L. Trujillo and Juan C. Galan, or
either of them, 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, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as he might or could do in person, 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 and Power of Attorney has been signed below by the
following persons in the capacities and on the dates indicated:
<TABLE>
<CAPTION>
NAME TITLE DATE
---- ----- ----
<S> <C> <C>
/s/ Gary L. Trujillo Chairman and Chief Executive June 30, 2000
----------------------------------------- Officer (Principal Executive
Gary L. Trujillo Officer)
/s/ Juan C. Galan Chief Financial Officer (Chief June 30, 2000
----------------------------------------- Financial and Accounting Officer)
Juan C. Galan
/s/ L. William Seidman Director June 30, 2000
-----------------------------------------
L. William Seidman
Director June __, 2000
-----------------------------------------
Alan J. Sokol
/s/ Jerry J. Colangelo Director June 30, 2000
-----------------------------------------
Jerry J. Colangelo
/s/ Dr. Louis Olivas Director June 30, 2000
-----------------------------------------
Dr. Louis Olivas
Director June __, 2000
-----------------------------------------
Jose Maria Figueres
</TABLE>
<PAGE> 16
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
------- -----------------------
<S> <C>
3.01 Articles of Incorporation, as amended (1)
3.02 Amended and Restated Bylaws (1)
5.01 Opinion of Brownstein Hyatt & Farber, P.C. *
10.01 Stock Purchase and Investor Rights Agreement between the Registrant and Gateway Companies, Inc. (2)
23.01 Consent of KPMG LLP *
23.02 Consent of Ehrhardt Keefe Steiner & Hottman, P.C. *
23.03 Consent of Brownstein Hyatt & Farber, P.C. (included in Exhibit 5.01)
</TABLE>
-------------------
* Filed herewith.
(1) Incorporated by reference from the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1999.
(2) Incorporated by reference from the Registrant's Current Report on Form 8-K
(as amended) originally filed March 30, 2000.
