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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
INFORMATION TO BE INCLUDED IN STATEMENTS
FILED PURSUANT TO RULE 13d-1(a)
AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
PHOTOLOFT.COM
(Name of Issuer)
Common Stock, par value $0.001 per share
(Title of Class of Securities)
71-934 8104
(CUSIP Number of Class of Securities)
----------------------
Intellect Capital Group, LLC
11111 Santa Monica Blvd.
Suite 650
Los Angeles, CA 90025
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
June 8, 2000
(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
Schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box
/ /.
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CUSIP No. 71-934 8104 13D Page 2 of 8
(1) NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOs. OF ABOVE PERSONS
(ENTITIES ONLY)
Intellect Capital Group, LLC
95-4749174
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a)
(b) X
(3) SEC USE ONLY
(4) SOURCE OF FUNDS
WC
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or 2(e) / /
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
State of Delaware
NUMBER OF SHARES : (7) SOLE VOTING POWER
BENEFICIALLY OWNED BY 28,716,392*
EACH REPORTING PERSON WITH
: (8) SHARED VOTING POWER
0
: (9) SOLE DISPOSITIVE POWER
28,716,392*
: (10) SHARED DISPOSITIVE POWER
0
(11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
28,716,392*
(12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11
EXCLUDES CERTAIN SHARES / /
(13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW 11 50.0% (on a fully diluted
basis)
(14) TYPE OF REPORTING PERSON
CO
* Pursuant to the Stock Purchase Agreement ("Agreement") attached hereto as
Exhibit 1, on June 8, 2000, the Reporting Person purchased 900 shares of
Issuer's Series B Preferred Convertible Stock (the "Purchased Stock"). On or
before July 7, 2000, at such date as may be selected by the Reporting Person,
the Purchased Stock shall be converted into 50.0% of the Issuer's
then-outstanding common stock following the conversion, on a fully diluted
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CUSIP No. 71-934 8104 13D Page 3 of 8
basis. As of June 8, 2000, Issuer had 28,716,392shares of common stock
outstanding on a fully diluted basis. Thus, if Reporting Person had converted
the Purchased Shares on June 8, 2000, pursuant to the terms of the Agreement,
Reporting Person would obtain sole and dispositive voting power over 28,716,392
shares, or 50.0% of Issuer's fully diluted common stock. Accordingly, although
Reporting Person currently owns 900 shares of Issuer's Series B Preferred
Convertible Stock, pursuant to Rule 13d-3(d)(1)(B) of the Securities Exchange
Act of 1934, as amended, Reporting Person is deemed to beneficially own
28,716,392 shares of Issuer's common stock. The exact number of shares of common
stock to be obtained by Reporting Person will depend on the number of shares of
Issuer's common stock outstanding, on a fully diluted basis, as of such date
that Reporting Person elects to convert the Purchased Shares.
ITEM 1. SECURITY AND ISSUER.
This statement on Schedule 13D (the "Schedule 13D") relates to the common
stock, par value $0.001 per share (the "Shares" or the "Issuer Common Stock"),
of PhotoLoft.com, Inc., a Nevada corporation (the "Issuer"). The principal
executive office of the Issuer is located at 300 Orchard City Drive, Suite 142,
Campbell, CA 95008.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(c) This Schedule 13D is filed by Intellect Capital Group, LLC, a
Delaware limited liability company (the "Reporting Person"). The address of the
principal business and principal office of the Reporting Person is 11111 Santa
Monica Blvd., Suite 650, Los Angeles, CA 90025. The Reporting Person is a Los
Angeles-based firm that provides investment and intellectual capital to
developmental and emerging-growth stage technology companies and takes an active
role to assist them to realize their full potential.
To the best of the Reporting Person's knowledge as of the date hereof, the
name, business address, present principal occupation or employment and
citizenship of each executive officer and director of the Reporting Person, and
the name, principal business and address of any corporation or other
organization in which such employment is conducted is set forth in Schedule I
hereto. The information contained in Schedule I is incorporated herein by
reference.
(d)-(e) During the last five years, neither the Reporting Person nor, to
the best knowledge of the Reporting Person, any of the executive officers or
directors of the Reporting Person, has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors), or been a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, Federal or State securities laws or finding any violation
with respect to such laws.
(f) The Reporting Person is a Delaware limited liability company.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On June 8, 2000, the Reporting Person entered into a Stock Purchase
Agreement dated as of April 18, 2000, by and between the Reporting Person and
the Issuer (the "Agreement"), providing for the investment by the Reporting
Person of $9,000 in exchange for 900 shares of Issuer's Series B Convertible
Preferred Stock (the "Purchased Stock"). In addition, as a result of
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CUSIP No. 71-934 8104 13D Page 4 of 8
this investment, it is anticipated that Reporting Person will be an active
shareholder of Issuer, and as such, will help Issuer with its strategic plan,
assist in building a management team and Board of Directors, identify and
consummate strategic relationships, provide advice on merger and acquisition
activities and assist Issuer in its capital formation process. Reporting Person
will actively support Issuer in the design and conduct of a comprehensive
program of corporate and marketing communications and investor relations to
accelerate the achievement of Issuer's business objectives and communicate
Issuer's industry and product vision. The Reporting Person used working capital
to make the investment in the Purchased Stock.
Pursuant to the Agreement, on or before July 7, 2000, the Purchased Stock
shall be converted into 50.0% of the Issuer's then-outstanding common stock
following the conversion, on a fully diluted basis. As of June 8, 2000, Issuer
had 28,716,392 shares of common stock outstanding on a fully diluted basis.
Thus, if Reporting Person had converted the Purchased Shares on June 8, 2000,
pursuant to the terms of the Agreement, Reporting Person would obtain sole and
dispositive voting power over 28,716,392 shares of Issuer's fully diluted common
stock.
ITEM 4. PURPOSE OF THE TRANSACTION.
(a)-(j) The information set forth in Item 3 is hereby incorporated herein
by reference.
Except as set forth above, or as described below, the Reporting Person does
not have any plans or proposals which relate to or would result in:
(a) The acquisition by any person of additional securities of the Issuer,
or the disposition of securities of the Issuer;
(b) An extraordinary corporate transaction, such as a merger,
reorganization or liquidation, involving the Issuer or any of its subsidiaries;
(c) A sale or transfer of a material amount of assets of the Issuer or any
of its subsidiaries;
(d) Any change in the present Board of Directors or management of the
Issuer, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the Board, except that Reporting
Person has the right to designate a new member of the board of directors of
Issuer;
(e) Any material changes in the present capitalization or dividend policy
of the Issuer;
(f) Any other material change in the Issuer's business or corporate
structure;
(g) Changes in the Issuer's charter, by-laws or instruments corresponding
thereto or other actions which may impede the acquisition of control of the
Issuer by any person;
(h) Causing a class of securities of the Issuer to be delisted from a
national securities exchange or to cease to be authorized to be quoted in an
inter-dealer quotation system of a registered national securities association;
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CUSIP No. 71-934 8104 13D Page 5 of 8
(i) A class of equity securities of the Issuer becoming eligible for
termination of registration pursuant to Section 12(g)(4) of the Securities
Exchange Act of 1934; or
(j) Any action similar to any of those enumerated above.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a)-(b) The number of shares of common stock anticipated to be covered by
this report is 28,716,392, which constitutes, based on the number of shares of
common stock outstanding on a fully diluted basis on June 8, 2000, approximately
50.0% of Issuer's common stock. In addition, Reporting Person is the beneficial
owner of warrants to purchase 400,000 additional shares of the Issuer's common
stock, which were previously purchased on March 24, 2000. Such warrants are
currently excercisable at $0.10 per share.
(c) Other than as set forth in this Item 5(a)-(b), to the best of the
Reporting Person's knowledge as of the date hereof (i) neither the Reporting
Person nor any subsidiary or affiliate of the Reporting Person nor any of the
Reporting Person's executive officers or directors, beneficially owns any shares
of Issuer's common stock, and (ii) there have been no transactions in the shares
of Issuer's common stock effected during the past 60 days by the Reporting
Person, nor to the best of the Reporting Person's knowledge, by any subsidiary
or affiliate of the Reporting Person or any of the Reporting Person's executive
officers or directors.
(d) No other person is known by the Reporting Person to have the right to
receive or the power to direct the receipt of dividends from, or the proceeds
from the sale of, the Issuer's common stock held by the Reporting Person.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
The information set forth, or incorporated by reference, in Items 3 through
5 is hereby incorporated herein by reference. A copy of the Agreement is
included as Exhibit 1 to this Schedule 13D. Pursuant to Section 6.2 of the
Agreement, if Reporting Person introduces another entity to Issuer and such
entity makes an investment in Issuer as a result of such introduction, Reporting
Person is entitled to receive customary introduction fees of seven percent.
Attached hereto as Exhibit 2 is the Certificate of Designations, Preferences and
Rights of Series B Convertible Preferred Stock of PhotoLoft.com, relating to the
Purchased Shares.
In connection with the Agreement, Issuer and Reporting Person also entered
into a Registration Rights Agreement dated June 8, 2000 (attached hereto as
Exhibit 3), which sets forth Reporting Person's rights and Issuer's obligations
as to the filing of a Registration Statement with the SEC to register Reporting
Person's 28,716,392 shares of Issuer's common stock.
On May 18, 2000, Issuer and Reporting Person entered into a Loan and
Security Agreement (attached hereto as Exhibit 4), whereby Reporting Person lent
$275,000 to Issuer, secured by a Promissory Note of even date therewith
(attached hereto as Exhibit 5).
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CUSIP No. 71-934 8104 13D Page 6 of 8
On May 22, 2000, Issuer and Reporting Person executed a side letter
(attached hereto as Exhibit 6) to supplement the Agreement by requiring Issuer
to: (i) enter into Shareholder Agreements with certain of its shareholders (the
form of which is attached hereto as Exhibit 7); (ii) file a proxy statement with
the SEC relating to a special shareholder's meeting to be held to approve an
increase in Issuer's authorized shares of common stock and a change in Issuer's
name and (iii) providing for certain penalties if Issuer should fail to timely
accomplish either of its obligations under the side letter.
To the best of the Reporting Person's knowledge, except as described in
this Schedule 13D, there are at present no contracts, arrangements,
understandings or relationships (legal or otherwise) among the persons named in
Item 2 above and between any such persons and any person with respect to any
securities to the Issuer, including but not limited to transfer or voting of any
of the securities, finder's fees, joint ventures, loan or option arrangements,
put or calls, guarantees of profits, division of profits or loss, or the giving
or withholding of proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit Description
1 Stock Purchase Agreement dated as of April 18, 2000 by and
between PhotoLoft.com, Inc. and Intellect Capital Group, LLC
(without exhibits)
2 Certificate of Designations, Preferences and Rights of Series B
Convertible Preferred Stock of PhotoLoft.com
3 Registration Rights Agreement dated June 8, 2000 by and between
PhotoLoft.com, Inc. and Intellect Capital Group, LLC
4 Loan and Security Agreement dated May 18, 2000 by and between
PhotoLoft.com, Inc. and Intellect Capital Group, LLC
5 Promissory Note dated May 18, 2000 by PhotoLoft.com, Inc.
6 Side Letter dated May 22, 2000, between PhotoLoft.com, Inc. and
Intellect Capital Group, LLC
7 Form of Shareholder Agreement by and between PhotoLoft.com, Inc.
and its shareholders
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CUSIP No. 71-934 8104 13D Page 7 of 8
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that this statement is true, complete and correct.
INTELLECT CAPITAL GROUP, LLC
By: /s/ TERREN S. PEIZER
-------------------------
Name: Terren S. Peizer
Title: Chief Executive Officer
Dated: June 19, 2000
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CUSIP No. 71-934 8104 13D Page 8 of 8
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF INTELLECT CAPITAL GROUP, LLC
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer of the
Reporting Person. Except as indicated below, each such person is a U.S. citizen,
and the business address of each such person is 11111 Santa Monica Blvd., Suite
650, Los Angeles, CA 90025.
BOARD OF DIRECTORS
Name Position
---- --------
Terren S. Peizer Chairman of the Board of Directors
and Chief Executive Officer
EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
Name Title and Present
---- Principal Occupation
--------------------
Richard Anderson Managing Director and Chief Financial Officer
John Shaw Managing Director and Chief Operating Officer
