<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 8, 2000
REGISTRATION NO. 333-41472
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 1 TO THE REGISTRATION STATEMENT
ON FORM S-3
UNDER THE SECURITIES ACT OF 1933
EDGAR ONLINE, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 50 WASHINGTON STREET 06-1447017
(State or other NORWALK, CONNECTICUT 06854 (IRS employer
jurisdiction of (203) 852-5666 identification
incorporation or (Address, including zip code, and number)
organization) telephone number, including area code,
of registrant's principal executive offices)
MARC STRAUSBERG
CHAIRMAN OF THE BOARD
EDGAR ONLINE, INC.
50 WASHINGTON STREET
NORWALK, CONNECTICUT 06854
(203) 852-5666
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE OF AGENT FOR SERVICE)
PLEASE SEND COPIES OF ALL COMMUNICATIONS TO:
MITCHELL C. LITTMAN, ESQ.
STEVEN D. USLANER, ESQ.
LITTMAN KROOKS ROTH & BALL P.C.
655 THIRD AVENUE
NEW YORK, NEW YORK 10017
(212) 490-2020
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this 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 number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, please check the following box and list the Securities
Act registration 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. [ ]
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
TITLE OF EACH CLASS OF AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED OFFERING PRICE PER AGGREGATE REGISTRATION
SHARE (2) OFFERING PRICE (1) FEE(2)(3)
-----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock ($0.01 par value
per share) 3,509,287(1) $4.82 $16,914,763 $4,702
-----------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes 262,000 shares of common stock issuable upon exercise of
outstanding warrants, 250,000 of which were issued in connection with our
initial public offering. The remaining 3,247,287 shares are being offered
for the accounts of the selling stockholders who acquired such shares in
private transactions. No other shares of the registrant's common stock are
being registered pursuant to this offering.
(2) Estimated solely for purposes of calculating registration fee in accordance
with Rule 457(c) of the Securities Act of 1933, as amended, based upon the
average high and low trading price of the Common Stock reported in the
Nasdaq National Market on September 5, 2000 in accordance with Rule 457(c)
under the Securities Act of 1933, as amended.
(3) $3,011.00 was previously paid.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
ii
<PAGE> 3
PRELIMINARY PROSPECTUS DATED SEPTEMBER 8, 2000
SUBJECT TO COMPLETION
EDGAR ONLINE, INC.
3,509,287 SHARES OF COMMON STOCK
This prospectus relates to the public offering, which is not being
underwritten, of up to 3,509,287 shares of our common stock which are held by
some of our current shareholders and may be offered and sold from time to time
by the selling shareholders. These shares include 262,000 shares of common stock
issuable upon exercise of outstanding warrants, 250,000 of which were issued in
connection with our initial public offering.
The prices at which such shareholders may sell the shares will be
determined by the prevailing market price for the shares or in negotiated
transactions. We will not receive any of the proceeds from the sale of the
shares.
Our common stock is traded on the Nasdaq National Market under the symbol
"EDGR." On September__, 2000 the last reported sale price for our common stock
on the Nasdaq National Market was $___ per share.
Neither the SEC nor any state securities commission has determined whether this
prospectus is truthful or complete. Nor have they made, nor will they make, any
determination as to whether anyone should buy these securities. Any
representation to the contrary is a criminal offense.
The date of this Prospectus is September __, 2000.
<PAGE> 4
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
This prospectus contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements deal with our
current plans, intentions, beliefs and expectations and statements of future
economic performance. Statements containing terms such as "believes," "does not
believe," "plans," "expects," "intends," "estimates," "anticipates" and other
phrases of similar meaning are considered to contain uncertainty and are
forward-looking statements.
Forward-looking statements involve known and unknown risks and
uncertainties that may cause our actual results in future periods to differ
materially from what is currently anticipated. We make cautionary statements in
certain sections of this prospectus, including under "Risk Factors." You should
read these cautionary statements as being applicable to all related
forward-looking statements wherever they appear in this prospectus, in the
materials referred to in this prospectus, in the materials incorporated by
reference into this prospectus, or in our press releases.
No forward-looking statement is a guarantee of future performance, and
you should not place undue reliance on any forward-looking statement.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents which have been filed by us with the Commission
pursuant to the Exchange Act or the Securities Act are incorporated by reference
in this prospectus:
- Our Quarterly Report on Form 10-Q for the quarter ended June 30, 2000.
- Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2000.
- Proxy Statement relating to our 2000 Annual Meeting.
- Our Annual Report on the Form 10-K for the year ended December 31, 1999.
- The description of our common stock and warrants contained in
Registration Statement on Form S-1, declared effective by the Commission
on May 26, 1999, File No. 333-75291.
- In addition, all documents filed by us pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this
prospectus and prior to the termination of the offering of the common
stock offered hereby shall be deemed to be incorporated herein by
reference and to be a part hereof from the date of filing of such
documents.
We hereby undertake to provide without charge to each person, including any
beneficial owner, to whom a copy of this prospectus is delivered, upon the
written or oral request of any such person, a copy of any and all of the above
documents. Such requests should be addressed to the Secretary, EDGAR Online,
Inc., 50 Washington Street, Norwalk, Connecticut 06854.
-2-
<PAGE> 5
PROSPECTUS SUMMARY
Because this is a summary, it does not contain all the information
about us that may be important to you. You should read the more detailed
information and the financial statements and related notes that are incorporated
by reference in this prospectus.
EDGAR ONLINE, INC.
We are an Internet-based provider of business, financial and
competitive information about public companies. We derive this information
primarily from the SEC's EDGAR (Electronic Data Gathering Analysis and
Retrieval) filing system and provide it to corporations, Web sites and
individuals on a real-time basis. We enhance raw SEC filings by organizing and
processing them into an easily accessible and searchable format and use
proprietary software to extract specific information requested by our customers.
Our three primary sources of revenue are contracts with corporate customers,
subscribers to our Web site services and advertising revenues.
Sales to corporate customers is one of the fastest growing segments of
our business. These customers purchase our data for use on corporate intranets,
private networks and Web sites. Our proprietary data mining technology allows us
to provide specific information tailored to their particular needs. Our
corporate customers include companies in a broad range of industries including
financial service organizations, news service providers and internet-based
financial information providers. Within these organizations, we tailor our
services to various departments including marketing, sales, human resources,
finance and legal.
We believe that EDGAR Online is the preeminent brand for EDGAR-based
business, financial and competitive information over the Internet. As of July
31, 2000, we had more than 475,000 registered users, of which approximately
16,000 were paying subscribers. We offer these services through our Web sites,
located at and . Our Web sites are designed to appeal to both casual users of
EDGAR information and to business professionals who require a broader range of
value-added services. Revenues from these sites are generated through the sale
of subscriptions and other premium services.
We also generate advertising revenues through the sale of banners and
sponsorship buttons on our Web sites and sponsored e-mail alerts to our
registered users. In the second quarter of 2000, our three Web sites delivered
in excess of 85 million ad impressions. We have contracts to deliver EDGAR based
content to over 225 widely used Web sites. These content distribution agreements
increase traffic to our Web sites and promote our brand name.
Having established EDGAR Online as a leading Internet provider of
EDGAR-based information, we now aim to exploit other existing and emerging
technologies to reach new customers. We are developing products and services for
use in wireless applications and are expanding our sales efforts to news
services and data vendors that are using proprietary private networks. Our goal
is to become the leading provider of EDGAR-based business, financial and
competitive information.
We are a Delaware corporation and were formed in November 1995 under
the name Cybernet Data Systems, Inc. Our executive offices are located at 50
Washington Street, Norwalk, Connecticut 06854 and our telephone number is (203)
852-5666. Information contained on our Web sites does not constitute part of,
nor is it incorporated by reference into, this prospectus.
-3-
<PAGE> 6
RISK FACTORS
Prospective investors should consider carefully the following risk factors
before purchasing any shares of the Common Stock offered hereby.
WE HAVE A LIMITED OPERATING HISTORY AND OUR FUTURE SUCCESS WILL DEPEND ON OUR
ABILITY TO INCREASE REVENUES.
As an early stage company in the new and rapidly evolving market for the
delivery of financial and business information over the Internet, we face
numerous risks and uncertainties in achieving increased revenues. We were
incorporated in November 1995 and launched our EDGAR Online Web site, located at
http://www.edgar-online.com, in January 1996 and began operating our Free EDGAR
Website, located at http://www./Freeedgar.com, following our acquisition of
Partes in September 1999. Accordingly, we have a limited operating history on
which you can evaluate our business and prospects. During this period, we have
invested heavily in our proprietary technologies to enable us to carry out our
business plan. These expenditures, in advance of revenues, have resulted in
operating losses in each of the last three years. In order to be successful, we
must increase our revenues from the sale of our services to corporate customers,
individual subscription fees and advertising sales. In order to increase our
revenues, we must successfully:
- create and successfully implement a marketing plan to (1)attract more
individual online users to our services, (2)convert visitors to paying
subscribers and (3) increase corporate sales;
- continue to improve our market position as an Internet-based commercial
provider of information services based on EDGAR filings;
- maintain our current, and develop new, content distribution
relationships with popular Web sites and providers of business and
financial information;
- maintain our current, and continue to increase, advertising revenues by
increasing traffic to our Web sites and by increasing the number of
advertisers;
- respond effectively to competitive pressures from other Internet
providers of EDGAR content;
- continue to develop and upgrade our technology; and
- attract, retain and motivate qualified personnel with Internet
experience to serve in various capacities, including sales and marketing
positions.
If we are not successful in addressing these uncertainties through the
execution of our business strategy, our business, results of operations and
financial condition will be materially adversely affected.
WE HAVE A HISTORY OF LOSSES AND ANTICIPATE THAT LOSSES WILL CONTINUE
As of June 30, 2000, we had an accumulated deficit of $13,332,000. We
may not ever generate sufficient revenues to achieve profitability. We incurred
net losses of $1,497,899 for the year ended December 31, 1997, $2,221,474 for
the year ended December 31, 1998, $4,162,861 for the year ended December 31,
1999 and $4,423,000 for the six months ended June 30, 2000. We expect operating
losses to continue for the foreseeable future as we continue to incur
significant operating costs and capital expenditures. As a result, we will need
to generate significant additional revenues to achieve and maintain
profitability. Even if we do achieve profitability, we cannot assure you that we
can sustain or increase profitability on a quarterly or annual basis in the
future. In addition, if revenues grow slower than we anticipate, or if operating
expenses exceed our expectations or cannot be adjusted accordingly, our
business, results of operations and financial condition will be materially
adversely affected.
-4-
<PAGE> 7
FUTURE ENHANCEMENTS TO THE SEC'S EDGAR SYSTEM MAY ERODE DEMAND FOR OUR SERVICES.
Our future success will depend on our ability to continue to provide
value-added services that distinguish our Web sites from the type of
EDGAR-information available from the SEC on its Web site. Through its Web site,
the SEC provides free access to EDGAR filings on a time-delayed basis of 24 to
72 hours. If the SEC, which has recently announced that it intends to modernize
the EDGAR system, were to make changes to its Web sites such as providing (1)
free real-time access to EDGAR filings or (2) value-added services comparable to
those provided on our Web sites, our business, results of operations and
financial condition would be materially adversely affected.
WE FACE INTENSE COMPETITION FROM OTHER PROVIDERS OF BUSINESS AND FINANCIAL
INFORMATION.
We compete with many providers of business and financial information,
including other Internet companies, for consumers' and advertisers' attention
and spending. Because our market poses no substantial barriers to entry, we
expect this competition to continue to intensify. The types of companies with
which we compete for users and advertisers include:
- traditional vendors of financial information, such as Disclosure;
- proprietary information services and Web sites targeted to business,
finance and investing needs, including those providing EDGAR content,
such as Bloomberg and LIVEDGAR; and
- Web-based providers of free EDGAR information, such as 10K Wizard.
Our future success will depend on our ability to maintain and enhance
our market position by: (1) using technology to add value to raw EDGAR
information, (2) keeping our pricing models below those of our competitors and
(3) signing high-traffic Web sites to distribution contracts.
Our potential commercial competitors include entities that currently
license our content, but which may elect to purchase a real-time EDGAR database
feed (called a Level I EDGAR feed) directly from the SEC and use it to create
value-added services, similar to services provided by us, for their own use or
for sale to others. This risk is particularly serious in light of the fact that
the SEC has, as part of the modernization of the EDGAR system, introduced a new
dissemination system effective November 1, 1998 that reduced the annual
subscription cost of a Level I feed by approximately 73%. Effective January 1,
2000 the annual subscription costs were lowered by an additional 42%.
Many of our existing competitors, as well as a number of potential
competitors, have longer operating histories, greater name recognition, larger
customer bases and significantly greater financial, technical and marketing
resources than we do. This may enable them to respond more quickly to new or
emerging technologies and changes in the types of services sought by users of
EDGAR based information, or to devote greater resources to the development,
promotion and sale of their services than we can. These competitors and
potential competitors may be able to undertake more extensive marketing
campaigns, adopt more aggressive pricing policies and make more attractive
offers to potential employees, subscribers and content distribution partners.
Our competitors may also develop services that are equal or superior to
the services offered by us or that achieve greater market acceptance than our
services. In addition, current and prospective competitors may establish
cooperative relationships among themselves or with third parties to improve
their ability to address the needs of our existing and prospective customers. If
these events occur, they could have a materially adverse effect on our revenue.
Increased competition could also result in price reductions, reduced margins or
loss of market share, any of which would adversely affect our business, results
of operations and financial condition.
-5-
<PAGE> 8
WE MAY NOT BE SUCCESSFUL IN INCREASING BRAND AWARENESS.
Our future success will depend, in part, on our ability to increase the
brand awareness of our EDGAR Online Web sites. If our marketing efforts are
unsuccessful or if we cannot increase our brand awareness, our business,
financial condition and results of operations would be materially adversely
affected. In order to build our brand awareness, we must succeed in our
marketing efforts, provide high quality services and increase traffic to our Web
sites. We have devoted a significant portion of the proceeds from our IPO to
expand our sales and marketing efforts as part of our brand-building efforts.
These efforts may not be successful.
WE MAY NOT BE SUCCESSFUL IN DEVELOPING NEW AND ENHANCED SERVICES AND FEATURES
FOR OUR WEB SITES.
Our market is characterized by rapidly changing technologies, evolving
industry standards, frequent new product and service introductions and changing
customer demands. To be successful, we must adapt to our rapidly changing market
by continually enhancing our existing services and adding new services to
address our customers' changing demands. We could incur substantial costs if we
need to modify our services or infrastructure to adapt to these changes. Our
business could be adversely affected if we were to incur significant costs
without generating related revenues or if we cannot adapt rapidly to these
changes.
Our business could also be adversely affected if we experience
difficulties in introducing new or enhanced services or if these services are
not favorably received by users. We may experience technical or other
difficulties that could delay or prevent us from introducing new or enhanced
services. Furthermore, after these services are introduced, we may discover
errors in these services which may require us to significantly modify our
software or hardware infrastructure to correct these errors.
WE ARE DEPENDENT ON THE CONTINUED GROWTH OF THE EMERGING MARKET FOR ONLINE
BUSINESS AND FINANCIAL INFORMATION.
The success of our business will depend on the growing use of the
Internet for the dissemination of business and financial information. The number
of individuals and institutions that use the Internet as a primary source of
business and financial information may not continue to grow. The market for the
distribution of business and financial information, including EDGAR-based
content, over the Internet has only recently begun to develop, is rapidly
evolving and is characterized by an increasing number of market entrants who
have introduced or developed electronic distribution services over the Internet
and private networks. As is typical of a rapidly evolving industry, demand and
market acceptance for new services is subject to a high level of uncertainty.
Because the market for our products and services is new and rapidly
evolving, it is difficult to predict with any certainty what the growth rate, if
any, and the ultimate size of this market will be. We cannot be certain the
market for our services will continue to develop or that our services will ever
achieve a significant level of market acceptance. If the market fails to
continue to develop, develops more slowly than expected or becomes saturated
with competitors, or if our services do not achieve significant market
acceptance, or if pricing becomes subject to considerable competitive pressures,
our business, results of operations and financial condition would be materially
adversely affected.
MAINTAINING EXISTING AND ESTABLISHING NEW CONTENT DISTRIBUTION RELATIONSHIPS
WITH HIGH-TRAFFIC WEB SITES IS CRUCIAL TO OUR FUTURE SUCCESS.
Because our advertising revenues, which form currently a significant
component of our total revenues, depend to a great extent on the traffic to our
Web sites, our business could be adversely affected if we do not maintain our
current, and establish additional, content distribution relationships on
commercially reasonable terms or if a significant number of our content
distribution relationships do not result in increased use of our Web sites. We
rely on establishing and maintaining content distribution relationships with
high-traffic Web sites for a significant portion of the traffic on our Web
sites. There is intense competition for placements on high-traffic Web sites,
and we may not be able
-6-
<PAGE> 9
to maintain our present contractual relationships or enter into any additional
relationships on commercially reasonable terms, if at all. Even if we maintain
our existing relationships or enter into new content distribution relationships
with other Web sites, they themselves may not continue to attract significant
numbers of users. Therefore, our Web sites may not continue to receive
significant traffic or receive additional new users from these relationships.
OUR BUSINESS COULD BE ADVERSELY AFFECTED BY A DOWNTURN IN THE FINANCIAL SERVICES
INDUSTRY.
We are dependent upon the continued demand for the distribution of
business and financial information over the Internet, making our business
susceptible to a downturn in the financial services industry. For example, a
decrease in the number of individuals investing their money in the equity
markets could result in a decrease in the number of subscribers utilizing our
Web site for real-time access to EDGAR filings. This downturn could have a
material adverse effect on our business, results of operations and financial
condition.
WE DEPEND ON DOUBLECLICK FOR ADVERTISING REVENUES.
We anticipate that our results of operations in any given period will
continue to depend to a significant extent upon advertising revenues generated
through our relationship with DoubleClick, Inc., which has provided us with a
full range of advertising services for the last two years. DoubleClick's failure
to enter into a sufficient number of advertising contracts during a particular
period could have a material adverse effect on our business, financial condition
and results of operations. Historically, a limited number of customers, all
represented by DoubleClick, have accounted for a significant percentage of our
paid advertising revenues. For the six months ended June 30, 2000, our
DoubleClick-related paid advertising revenue was 22% of our total revenues for
this period.
Our existing agreement with DoubleClick can be canceled by either party
on 90 days notice. In addition, this agreement does not prohibit DoubleClick
from selling the same type of service that we currently receive from them to Web
sites that compete with our site. If DoubleClick is unable or unwilling to
provide these advertising services to us in the future, we would be required to
obtain them from another provider or perform them ourselves. We would likely
lose significant advertising revenues while we are in the process of replacing
DoubleClick's services.
WE FACE INTENSE COMPETITION FOR ADVERTISING REVENUES AND THE VIABILITY OF THE
INTERNET AS AN ADVERTISING MEDIUM IS UNCERTAIN.
We compete with both traditional advertising media, such as print, radio
and television, and other Web sites for a share of advertisers' total
advertising budgets. If advertisers do not perceive the Internet to be an
effective advertising medium, companies like ours will be unable to compete
successfully with traditional media for advertising revenues. In addition, if we
are unable to generate sufficient traffic on our Web sites, we could potentially
lose advertising revenues to other Web sites that generate higher user traffic.
Because advertising sales make up a significant component of our revenues,
either of these developments could have a significant adverse impact on our
business, results of operations or financial condition.
WE MAY NOT BE ABLE TO CREATE AND DEVELOP AN EFFECTIVE DIRECT SALES FORCE.
Because a significant component of our growth strategy relates to
increasing our revenues from sales of our corporate services, our business would
be adversely affected if we were unable to develop and maintain an effective
sales force to market our services to this customer group. Until recently, we
had not employed any sales executives to sell our corporate services. From March
1999 to June 2000 we hired seven salesmen whose task is to market and sell our
services to the corporate market. These efforts may not be successful.
-7-
<PAGE> 10
WE MAY NOT BE ABLE TO SUCCESSFULLY MANAGE OUR GROWTH.
We have experienced and are currently experiencing a period of
significant growth. If we are unable to manage our growth effectively, our
business will be adversely affected. This growth has placed, and our anticipated
future growth will continue to place, a significant strain on our technical,
financial and managerial resources. As part of this growth, we may have to
implement new operational and financial systems and procedures and controls to
expand, train and manage our employees, especially in the areas of sales and
product development.
WE FACE RISKS IN CONNECTION WITH OUR RECENT ACQUISITION AND OTHER ACQUISITIONS
AND BUSINESS COMBINATIONS THAT WE MAY CONSUMMATE.
We plan to continue to expand our operations and market presence by
making acquisitions, such as our recent FreeEDGAR acquisition and entering into
business combinations, investments, joint ventures or other strategic alliances
with other companies. These transactions create risks such as:
- difficulty assimilating the operations, technology and personnel of the
combined companies,
- disruption of our ongoing business,
- problems retaining Key technical and managerial personnel,
- expenses associated with amortization of goodwill and other purchased
intangible assets,
- additional operating losses and expenses of acquired businesses, and
- impairment of relationships with existing employees, customers and
business partners.
We may not succeed in addressing these risks. In addition, the business
we have acquired, and in the future may acquire, may continue to incur operating
losses.
WE DEPEND ON KEY PERSONNEL.
Our future success will depend to a significant extent on the continued
services of our senior management and other key personnel, particularly Susan
Strausberg, Chief Executive Officer, Marc Strausberg, Chairman and Chief
Information Officer, Tom Vos, President and Chief Operating Officer and Greg
Adams, Chief Financial Officer, each of whom are parties to written employment
agreements. The loss of the services of these, or certain other key employees,
would likely have a material adverse effect on our business. We do not maintain
"key person" life insurance for any of our personnel. Our future success will
also depend on our continuing to attract, retain and motivate other highly
skilled employees. Competition for personnel in our industry is intense. We may
not be able to retain our key employees or attract, assimilate or retain other
highly qualified employees in the future. If we do not succeed in attracting new
personnel or retaining and motivating our current personnel, our business will
be adversely affected. In addition, the employment agreements with our key
employees contain restrictive covenants that restrict their ability to compete
against us or solicit our customers. These restrictive covenants, or some
portion of these restrictive covenants, may be deemed to be against public
policy and may not be fully enforceable. If these provisions are not
enforceable, these employees may be in a position to leave us and work for our
competitors or start their own competing businesses.
WE DEPEND ON THIRD PARTIES FOR IMPORTANT ASPECTS OF OUR BUSINESS OPERATIONS.
We depend on third parties to develop and maintain the software and
hardware we use to operate our Web sites. iXL Enterprises, Inc., an Internet
strategy consulting company, develops, maintains and upgrades our proprietary
software, which includes those features which enable users to locate and
retrieve data, as well as
-8-
<PAGE> 11
our database of EDGAR filings, Web-based customer interfaces and customer
support and billing systems. While we currently have a contract with iXL with
respect to the provision of these services, if iXL were unable or unwilling to
provide these services, we would need to find a suitable replacement. The
failure to find a suitable replacement or to come to an agreement with an
acceptable alternate provider on terms acceptable to us could materially
adversely affect our business, results of operations and financial condition.
We also have a hosting contract with Globix Corporation, a provider of
Internet services, pursuant to which Globix operates and maintains the Web
servers owned by us in their New York City data center. Our hosting contract
with Globix expires in July 2003. If Globix were unable or unwilling to provide
these services, we would have to find a suitable replacement. Our operations
could be disrupted while we were in the process of finding a replacement for
Globix and the failure to find a suitable replacement or to reach an agreement
with an alternate provider on terms acceptable to us could materially adversely
affect our business, results of operations and financial condition.
WE FACE A RISK OF SYSTEM FAILURE.
Our ability to provide EDGAR content on a real-time basis depends on the
efficient and uninterrupted operation of our computer and communications
hardware and software systems. Similarly, our ability to track, measure and
report the delivery of advertisements on our site depends on the efficient and
uninterrupted operation of a third-party system provided by DoubleClick. These
systems and operations are vulnerable to damage or interruption from human
error, natural disasters, telecommunication failures, break-ins, sabotage,
computer viruses, intentional acts of vandalism and similar events. Any system
failure, including network, software or hardware failure, that causes an
interruption in our service or a decrease in responsiveness of our Web sites
could result in reduced traffic, reduced revenue and harm to our reputation,
brand and relations with advertisers.
Our operations depend on Globix's ability to protect its and our
systems in its data center against damage from fire, power loss, water damage,
telecommunications failure, vandalism and similar unexpected adverse events.
Although Globix provides comprehensive facilities management services, including
human and technical monitoring of all production servers 24 hours-per-day, seven
days-per-week, Globix does not guarantee that our Internet access will be
uninterrupted, error-free or secure. Any disruption in the Internet access to
our Web sites provided by Globix could materially adversely affect our business,
results of operations and financial condition. Our insurance policies may not
adequately compensate us for any losses that we may incur because of any
failures in our system or interruptions in the delivery of our services. Our
business, results of operations and financial condition could be materially
adversely affected by any event, damage or failure that interrupts or delays our
operations.
THERE ARE RISKS OF INCREASED USERS STRAINING OUR SYSTEMS AND OTHER SYSTEM
MALFUNCTIONS.
In the past, our Web sites have experienced significant increases in
traffic when there have been important business or financial news stories and
during the seasonal periods of peak SEC filing activity. In addition, the number
of our users has continued to increase over time and we are seeking to further
increase the size of our user base and the frequency with which they use our
services. Therefore, our Web sites must accommodate an increasingly high volume
of traffic and deliver frequently updated information. Our Web sites have in the
past, and may in the future, experience slower response times or other problems
for a variety of reasons, including hardware capacity restraints and software
failures. These strains on our system could cause customer dissatisfaction and
could discourage visitors from becoming paying subscribers. We also depend on
the Level I EDGAR feed we purchases in order to provide SEC filings on a
real-time basis. Our Web sites could experience disruptions or interruptions in
service due to the failure or delay in the transmission or receipt of this
information.
These types of occurrences could cause users to perceive our Web sites
as not functioning properly and cause them to use other methods, including the
SEC's Web site or those of our competitors, to obtain EDGAR-based information.
-9-
<PAGE> 12
WE LICENSE THE TERM EDGAR FROM THE SEC AND DEPEND ON OTHER INTELLECTUAL
PROPERTY.
Trademarks and other proprietary rights, principally our proprietary
database technology, are important to our success and our competitive position.
The SEC is the owner of a United States trademark registration covering the use
of the term EDGAR. We have obtained a non-exclusive, royalty-free license from
the SEC to use the term EDGAR in our trademarks, service marks and corporate
name. This license is due to expire in March 2009. Since we have built
significant brand recognition through the use of the term EDGAR in our service
offerings, company name and Web sites, our business, results of operations and
financial condition could be adversely affected if we were to lose the right to
use the term EDGAR in the conduct of our business.
We seek to protect our trademarks and other proprietary rights by
entering into confidentiality agreements with our employees, consultants and
content distribution partners, and attempting to control access to and
distribution of our proprietary information. Despite our efforts to protect our
proprietary rights from unauthorized use or disclosure, third parties may
attempt to disclose, obtain or use our proprietary information. The precautions
we take may not prevent this type of misappropriation. In addition, our
proprietary rights may not be viable or of value in the future since the
validity, enforceability and scope of protection of proprietary rights in
Internet-related industries is uncertain and still evolving.
Finally, third parties could claim that our database technology
infringes their proprietary rights. Although we have not been subjected to
litigation relating to these types of claims, such claims and any resultant
litigation, should it occur, could subject us to significant liability for
damages and could result in the invalidation of our proprietary rights. Even if
we prevail, such litigation could be time-consuming and expensive, and could
result in the diversion of our time and attention, any of which could materially
adversely affect our business, results of operations and financial condition.
Any claims or litigation could also result in limitations on our ability to use
our trademarks and other intellectual property unless we enter into license or
royalty agreements, which agreements may not be available on commercially
reasonable terms, if at all.
WE MAY NOT BE ABLE TO OBTAIN ADDITIONAL FINANCING.
We currently anticipate that our available cash resources combined with
cash generated from operations will be sufficient to meet our anticipated
working capital and capital expenditure requirements for at least the next 12
months. We may need to raise additional funds, however, to fund more rapid
expansion, to develop new or enhance existing services, or to respond to
competitive pressures. We cannot assure you that additional financing will be
available on terms favorable to us, or at all. If adequate funds are not
available or are not available on acceptable terms, our ability to fund our
expansion, take advantage of unanticipated opportunities, develop or enhance
services or products or otherwise respond to competitive pressures would be
significantly limited. Our business, results of operations and financial
condition could be materially adversely affected by these financing limitations.
WE COULD BE LIABLE FOR OR ADVERSELY AFFECTED BY UNDETECTED YEAR 2000 PROBLEMS.
Our business may suffer as a result of defects relating to year 2000
compliance issues that have not yet been detected. Our products run in
conjunction with the systems of our customers; our products could fail to
function properly if our customers' systems encounter year 2000 compliance
problems. If this happens, it could result in liability to us or adversely
affect results of operations.
WE ARE DEPENDENT ON THE INTERNET INFRASTRUCTURE.
Our future success will depend, in significant part, upon the
maintenance of the various components of the Internet infrastructure, such as a
reliable backbone network with the necessary speed, data capacity and security,
and the timely development of enabling products, such as high-speed modems,
which provide reliable and timely Internet access and services. To the extent
the Internet continues to experience increased numbers of users, frequency of
use or increased user bandwidth
-10-
<PAGE> 13
requirements, we cannot be sure that the Internet infrastructure will continue
to be able to support the demands placed on it or that the performance or
reliability of the Internet will not be adversely affected. Furthermore, the
Internet has experienced a variety of outages and other delays as a result of
damage to portions of its infrastructure or otherwise, and such outages or
delays could adversely affect our Web sites and the Web sites of our co-branded
partners, as well as the Internet service providers and online service providers
our customers use to access our services. In addition, the Internet could lose
its viability as a commercial medium due to delays in the development or
adoption of new standards and protocols that can handle increased levels of
activity. We cannot predict whether the infrastructure and complementary
products and services necessary to maintain the Internet as a viable commercial
medium will be developed or maintained.
WE ARE SUBJECT TO UNCERTAIN GOVERNMENT REGULATION AND OTHER LEGAL UNCERTAINTIES
RELATING TO THE INTERNET.
There are currently few laws or regulations that specifically regulate
communications or commerce on the Internet. Any new laws or regulations relating
to the Internet could adversely affect our business. In addition, current laws
and regulations may be applied and new laws and regulations may be adopted in
the future that address issues such as user privacy, pricing, taxation and the
characteristics and quality of products and services offered over the Internet.
For example, several telecommunications companies have petitioned the Federal
Communications Commission to regulate Internet service providers and online
service providers in a manner similar to long distance telephone carriers and to
impose access fees on these companies. This could increase the cost of
transmitting data over the Internet, which could increase our expenses and
discourage people from using the Internet to obtain business and financial
information. Moreover, it may take years to determine the extent to which
existing laws relating to issues such as property ownership, libel and personal
privacy are applicable to the Internet.
WE FACE WEB SECURITY CONCERNS THAT COULD HINDER INTERNET COMMERCE.
Any well-publicized compromise of Internet security could deter more
people from using the Internet or from using it to conduct transactions that
involve transmitting confidential information, such as stock trades or purchases
of goods or services. Because a portion of our revenue is based on individuals
using credit cards to purchase subscriptions over the Internet and a portion
from advertisers who seek to encourage people to use the Internet to purchase
goods or services, our business could be adversely affected by this type of
development. We may also incur significant costs to protect against the threat
of security breaches or to alleviate problems, including potential private and
governmental legal actions, caused by such breaches.
WE COULD FACE LIABILITY AND OTHER COSTS RELATING TO OUR STORAGE AND USE OF
PERSONAL INFORMATION ABOUT OUR USERS.
Our policy is not to willfully disclose any individually identifiable
information about any user to a third party without the user's consent. This
policy statement is available to users of our subscription services when they
initially register. Despite this policy, however, if third persons were able to
penetrate our network security or otherwise misappropriate our users' personal
or credit card information, we could be subject to liability. These could
include claims for unauthorized purchases with credit card information,
impersonation or other similar fraud claims. They could also include claims for
other misuses of personal information such as for unauthorized marketing
purposes. These claims could result in litigation. In addition, the Federal
Trade Commission and several states have been investigating certain Internet
companies regarding their use of personal information. We could incur additional
expenses if new regulations regarding the use of personal information are
introduced or if these regulators chose to investigate our privacy practices.
WE MAY BE LIABLE FOR INFORMATION DISPLAYED ON OUR WEB SITES.
We may be subjected to claims for defamation, negligence, copyright or
trademark infringement, violation of securities laws or other claims relating to
the information that we publish on our Web sites, which may materially adversely
affect
-11-
<PAGE> 14
our business. These types of claims have been brought, sometimes successfully,
against online services as well as other print publications in the past. We
could also be subjected to claims based upon the content that is accessible from
our Web sites through links to other Web sites. Our general liability insurance
may not cover these claims and may not be adequate to protect us against all
liabilities that may be imposed.
USE OF PROCEEDS
The proceeds from the sale of the common stock offered pursuant to this
prospectus are solely for the account of the selling shareholders. Accordingly,
we will not receive any proceeds from the sale of the shares by the selling
shareholders. We will receive, however, proceeds from the exercise of warrants
of approximately $2,861,165 if all the warrants relating to the shares offered
hereby are exercised. There can be no assurance that such warrants will be
exercised. In the event that any or all of the warrants are exercised, the
proceeds will be used for general corporate purposes.
SELLING STOCKHOLDERS
The following table sets forth the number of shares of common stock
beneficially owned by each of the selling stockholders as of the date hereof,
the number of shares owned by them covered by this prospectus and the amount and
percentage of shares to be owned by each selling stockholder after the sale of
all of the shares offered by this prospectus. The table also sets forth the
number of shares of common stock certain selling stockholders will receive upon
exercise of warrants, 250,000 of which were issued in connection with our
initial public offering on May 26, 1999. Except for Marc Bell, a director of the
Company and the President and Chief Executive Officer of Globix Corp., a selling
stockholder, none of the selling stockholders has had any position, office or
other material relationship with the Company within the past three years other
than as a result of the ownership of the shares or other securities of the
Company. The information included below is based on information provided by the
selling stockholders. Because the selling stockholders may offer some or all of
their shares, no definitive estimate as to the number of shares that will be
held by the selling stockholders after such offering can be provided and the
following table has been prepared on the assumption that all shares of Common
Stock offered hereby will be sold.
-12-
<PAGE> 15
<TABLE>
<CAPTION>
Shares which Shares
may be Owned Percentage of
Shares acquired upon After Shares Owned
Beneficially Shares exercise of Offering After Offering
Name Owed Offered warrants (1) (1)
------- ------------ ------- -------- ----- ------------
<S> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------------------
C.E. Unterberg, Towbin 162,000(2) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Fahnestock & Co. Inc 57,690(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Henry P. Williams 13,152(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Roger D. Elas 6,090(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Frank Cohen 7,036(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Yvonne K. Furrer 5,845(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Philip W. Ho 5,427(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Kathy Wilson 3,010(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
Michael D. Smith 1,750(3) 0 0
------------------------------------------------------------------------------------------------------------------------------------
VM Equity 1999 Employee Incentive Plan 17,100(4) 17,100(4) -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
John U. Moorhead 34,200(5) 34,200(5) -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Aimee Troyen 34,200(5) 34,200(5) -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Bowne & Co. 1,000,000 1,000,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Globix Corporation 996,242 996,242 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Reuters Holding Switzerland S.A 460,871 460,871 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
David M. Millison & Susan L. Rabb, Jt Ten 1,956 1,956 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Gloria Schnitzer 8,844 8,844 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
J Shelby Bryan 33,333 33,333 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Jeffrey Porter & Joyce Porter, Jt Ten 2,445 2,445 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
John G. Puente 11,100 11,100 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Leon M. Wagner & Marsha Wagner, Jt Ten 4,890 4,890 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Thomas J. Niedermeyer Jr 5,400 5,400 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Linda Heller Kamm 20,000 20,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Maria Pierce 2,743 2,743 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Mark Schnitzer 95,350 95,350 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Meyer German 6,000 6,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Robert German 1,000 1,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Idee German Schoenheimer 3,000 3,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Millison Income & Capital Fund LP 11,820 11,820 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Millison Special Investment Partners LP 8,865 8,865 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Mindy Franklin 850 850 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Muhit Rahman & Annie Rahman Jt Ten 489 489 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Natasha Takara 244 244 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Pierre Schoenheimer 20,000 20,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Richard A. Smith 2,955 2,955 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Rostev Limited 4,400 4,400 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Reinfrank Living Trust U/A 10,800 10,800 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Samuel S. Beard 11,100 11,100 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Speech Compression Tech 10,000 10,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Steve Gold 244 244 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Stephen P. Rader & Anne W. Rader Lvg 209,567 209,567 -- 0 0
Trust dtd 9-9-94
------------------------------------------------------------------------------------------------------------------------------------
Steven Anagnos 2,743 2,743 -- 0 0
</TABLE>
-13-
<PAGE> 16
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
------------------------------------------------------------------------------------------------------------------------------------
Teresa Linder 538 538 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Thomas B. Hofeller 196 196 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
VMR Luxembourg SA 110,000 110,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
William D. Rollnick 20,000 20,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
William F. Nicklin 10,000 10,000 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Yagemann Revocable Trust 2,445 2,445 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Daniel A. Medina & Laura Martin, Jt 978 978 -- 0 0
Ten
------------------------------------------------------------------------------------------------------------------------------------
Elliot Broidy 11,325 11,325 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Joshua L. Gutfreund 2,831 2,831 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Steven Holzman 5,662 5,662 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Michael Klein 11,325 11,325 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Mann Investment Company, LP 22,649 22,649 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
John Mass 1,133 1,133 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Whittier Ventures, LLC 11,325 11,325 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Rader Reinfrank & Co. LLC 3,590 3,590 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Chang Huang 196 196 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Jinglan Wang 98 98 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Lei Ding 98 98 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Theresa Dea 49 49 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
Michael Sobiek 98 98 -- 0 0
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Assumes sale of all shares owned by the selling stockholders.
(2) Includes 12,000 shares issuable upon the exercise (at a price
per share of $9.50) of a warrant issuable in connection with a
private placement transaction and 150,000 shares issuable upon
the exercise (at a price per share of $10.45) of warrants
issued in connection with our initial public offering.
(3) Represents shares issuable upon the exercise (at a price per
share of $10.45) of warrants issued in connection with our
initial public offering.
(4) Includes 6,667 shares issuable upon the exercise (at a price
per share of $1.50) of a warrant, 1,200 shares issuable upon
the exercise (at a price per share of $4.50) of a warrant,
1,033 shares issuable upon the exercise (at a price per share
of $1.50) of a warrant and 6,700 shares issuable upon the
exercise (at a price per share of $1.49) of a warrant.
(5) Includes 13,333 shares issuable upon the exercise (at a price
per share of $1.50) of a warrant, 2,400 shares issuable upon
the exercise (at a price per share of $4.50) of a warrant,
2,067 shares issuable upon the exercise (at a price per share
of $1.50) of a warrant and 13,400 shares issuable upon the
exercise (at a price per share of $1.49) of a warrant.
PLAN OF DISTRIBUTION
We are registering 3,509,287 shares of our common stock with this
prospectus on behalf of the selling stockholders named in this prospectus. These
shares include an aggregate of 262,000 shares of common stock certain selling
stockholders will receive upon exercise of warrants, 250,000 of which were
issued in connection with our initial public offering on May 26, 1999. The
selling shareholders will act independently of us in making decisions with
respect to the timing, manner and size of each sale. We have agreed to bear
certain expenses in connection with the registration of the shares of our common
stock offered and being sold by the selling stockholders. The selling
stockholders will bear all brokerage commissions and similar selling expenses,
if any, attributable to sales of the shares. Sales of shares may be affected by
the selling stockholders from time to time in one or more types of transactions
(which may include block transactions) on the NASDAQ National Market, in the
over-the-counter market, in negotiated transactions, or a combination of such
methods of sale, at market prices prevailing at the time of sale, or at
negotiated prices. These transactions may or may not involve brokers or dealers.
The selling stockholders may affect sales of shares:
-14-
<PAGE> 17
- In ordinary brokerage transactions in which the broker
solicits purchasers or executes unsolicited orders, or
transactions in which the broker may acquire the share as
principal and resell the shares into the public market in any
manner permitted by the selling stockholders under this
prospectus;
- In connection with the pledge of shares registered hereunder
to a broker/dealer or other pledgee to secure debts or other
obligations, and the sale of the shares so pledged upon a
default;
- Through the writing or settlement of non-traded and
exchange-traded put or call option contracts, and by means of
the establishment or settlement of other hedging transactions
including forward sale transactions. In addition, the selling
stockholders may loan their shares to broker/dealers who are
counterparties to hedging transactions and such broker/dealers
may sell the shares so borrowed into the public market.
Broker-dealers may receive compensation in the form of discounts,
concessions, or commissions from the selling stockholder and/or the purchasers
of shares for whom such broker-dealers may act as agents or to whom they sell as
principal or both (this compensation to a particular broker-dealer might be in
excess of customary commissions).
The selling stockholders and any broker-dealers that act in connection with
the sale of shares might be deemed to be "underwriters" within the meaning of
Section 2(a)(11) of the Securities Act. In this case, any commissions received
by broker dealers and any profit on the resale of the shares sold by them while
acting as principals might be deemed to be underwriting discounts or commissions
under the Securities Act. We have agreed to indemnify the selling stockholders
named in this prospectus against certain liabilities, including liabilities
arising under the Securities Act. The selling stockholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions
involving sales of the shares against certain liabilities, including liabilities
arising under the Securities Act.
Because the selling stockholders may be deemed to be "underwriters" within
the meaning of Section 2(a)(11) of the Securities Act, the selling stockholders
will be subject to the prospectus delivery requirements of the Securities Act.
The selling stockholders also may resell all or a portion of their shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
if they meet the criteria and conform to the requirements of Rule 144.
LEGAL MATTERS
The validity of the issuance of the common stock offered hereby has been
passed upon for us by Littman Krooks Roth & Ball P.C., 655 Third Avenue, New
York, New York 10017.
EXPERTS
The balance sheets of EDGAR Online, Inc., as of December 31, 1999 and 1998
and the statements of operations, shareholders' equity (deficit) and cash flows
for each of the years in the three-year period ended December 31, 1999 and the
related financial statement schedule have been incorporated by reference herein
and in the registration statement in reliance upon the reports of KPMG LLP,
independent certified public accountants, incorporated by reference herein, and
upon the authority of said firm as experts in accounting and auditing.
AVAILABLE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Commission. Those reports, proxy statements and other
information may be obtained:
-15-
<PAGE> 18
- At the Public Reference Room of the Commission, Room
1024-Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549;
- At the public reference facilities at the Commission's
regional offices located at Seven World Trade Center, 13th
Floor, New York, New York 10048 or Northwestern Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661;
- By writing to the Commission, Public Reference Section,
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549;
- At the offices of The Nasdaq Stock Market, Reports Section,
1735 K Street, N.W., Washington, D.C. 20006; or
- From the Internet site maintained by the Commission at
http://www.sec.gov, which contains reports, proxy and
information statements and other information regarding issuers
that file electronically with the Commission.
Some locations may charge prescribed or modest fees for copies.
We have filed with the Commission a registration statement under the
Securities Act of 1933, as amended, with respect to the common stock offered
hereby. This prospectus, which is a part of the registration statement, does not
contain all the information set forth in, or annexed as exhibits to, such
registration statement, certain portions of which have been omitted pursuant to
rules and regulations of the Commission. For further information with respect to
our company and the common stock, reference is made to such registration
statement, including the exhibits thereto, copies of which may be inspected and
copied at the aforementioned facilities of the Commission. Copies of such
registration statement, including the exhibits, may be obtained from the Public
Reference Section of the Commission at the aforementioned address upon payment
of the fee prescribed by the Commission.
-16-
<PAGE> 19
TABLE OF CONTENTS
<TABLE>
<CAPTION>
SECTION PAGE
------- ----
<S> <C>
Special Note Regarding Forward Looking
Statements ........................... 2
Incorporation of Certain Information
By Reference ......................... 2
Prospectus Summary ................... 3
Risk Factors ......................... 4
Use of Proceeds ...................... 12
Selling Stockholders ................. 12
Plan of Distribution ................. 14
Legal Matters ........................ 15
Experts .............................. 15
Available Information ................ 15
</TABLE>
3,509,287 SHARES
COMMON STOCK
EDGAR ONLINE, INC.
-------------
PROSPECTUS
-------------
September__,2000
<PAGE> 20
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses in connection with this offering are as follows:
<TABLE>
<CAPTION>
AMOUNT
------
<S> <C>
SEC Registration Fee ....... $ 4,702
-------
Legal Fees and Expenses .... 15,000
-------
Accounting Fees and Expenses 4,000
-------
Miscellaneous .............. 2,989
-------
Total ...................... $25,000
-------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law authorizes a court
to award, or a corporation's board of directors to grant, indemnity to directors
and officers in terms sufficiently broad to permit such indemnification under
certain circumstances for liabilities (including reimbursement for expenses
incurred) arising under the Securities Act of 1933, as amended (the "Securities
Act").
As permitted by the Delaware General Corporation Law, the Registrant's
Amended and Restated Certificate of Incorporation includes a provision that
eliminates the personal liability of its directors for monetary damages for
breach of fiduciary duty as a director, except for liability (i) for any breach
of the director's duty of loyalty to the Registrant or its stockholders, (ii)
for acts or omissions not in good faith or that involve intentional misconduct
or a knowing violation of law, (iii) under section 174 of the Delaware General
Corporation Law (regarding unlawful dividends and stock purchases) or (iv) for
any transaction from which the director derived an improper personal benefit.
As permitted by the Delaware General Corporation Law, the Bylaws of the
Registrant provide that (i) the Registrant is required to indemnify its
directors and officers to the fullest extent permitted by the Delaware General
Corporation Law, subject to certain very limited exceptions, (ii) the Registrant
may indemnify its other employees and agents as set forth in the Delaware
General Corporation Law, (iii) the Registrant is required to advance expenses,
as incurred, to its directors and executive officers in connection with a legal
proceeding to the fullest extent permitted by the Delaware General Corporation
Law, subject to certain very limited exceptions and (iv) the rights conferred in
the Bylaws are not exclusive.
The Registrant has also entered into certain agreements wherein it
has agreed, subject to certain limitations, to indemnify its officers and
directors for judgments, fines, assessments, interest and other charges they may
incur as a party, witness or other participant in any threatened, pending or
completed actions, suits or proceeding by reason of their acting as an officer,
director, employee or agent of the registrant or any of its subsidiaries,
provided that the indemnified party acted in good faith in a manner such person
believed to be in or not opposed to the best interests of the Registrant and,
with respect to certain matters, had no reasonable cause to believe that his
conduct was unlawful.
Insurance for the Registrant's directors and officers, against
expenses and liabilities in connection with the defense of actions, suits or
proceedings to which they may be parties by reason of having been directors or
officers of the Registrant, is provided by the Registrant.
II-1
<PAGE> 21
ITEM 16. EXHIBITS
(a) Exhibits
<TABLE>
<CAPTION>
Exhibit Number Description
-------------- -----------
<S> <C>
Opinion of Littman Krooks Roth & Ball P.C. as to the
5 legality of the securities being registered.
23.1 Consent of KPMG LLP.
Consent of Littman Krooks Roth & Ball P.C., included
23.2 in opinion filed as Exhibit 5.
Power of Attorney, included in the signature page of
24 this Registration Statement.
</TABLE>
ITEM 17. UNDERTAKINGS.
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; and
(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 and 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 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement; and
(iii) 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 (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 and Section 15(d) of the Exchange Act that are incorporated by
reference in the registration statement.
(2) That, for purposes 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 as such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
II-2
<PAGE> 22
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act, each filing of the registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the Exchange
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.
(5) That, 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 precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 23
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 Amendment No. 1 to the Form S-3 and has duly
caused this registration statement on Form S-3 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York in the State of
New York on September 7, 2000.
EDGAR ONLINE, INC.
By /s/ SUSAN STRAUSBERG
------------------------------------------
Susan Strausberg
Chief Executive Officer
and Director
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Tom Vos, his or her attorney-in-fact,
each with the power of substitution, for him and in his name, place and stead,
in any and all capacities, to sign any and all amendments to this Amendment No.
1 to the Registration Statement on Form S-3 (including post-effective amendments
or any abbreviated registration statement and any amendments thereto filed
pursuant to Rule 462(b) increasing the number of securities for which
registration is sought), and to file the same, with all exhibits thereto and all
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that such attorneys-in-fact and agents or any of them, or his or their
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Registration Statement has been signed by the following persons in the
capacities indicated below on the 7th day of September, 2000.
Signature
/s/ SUSAN STRAUSBERG
--------------------------------
Susan Strausberg
Chief Executive Officer,
and Director
*
--------------------------------
Greg D. Adams
Chief Financial Officer
*
--------------------------------
Marc Strausberg
Chairman of the Board
/s/ TOM VOS
--------------------------------
Tom Vos
President, Director
*
--------------------------------
Marc Bell
Director
II-4
<PAGE> 24
*
--------------------------------
Stefan Chopin
Director
*
--------------------------------
Mark Maged
Director
*
-------------------------------
Bruce Bezpa
Director
* By Tom Vos, Attorney-in-Fact
II-5
