As filed with the Securities and Exchange Commission on ________, 199_
Registration No.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2/A
FIRST AMENDMENT TO
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
--------------
TRADING SOLUTIONS.com, INC.
(Exact name of registrant as specified in its charter)
NEVADA 88-0425691 6289
(State or other jurisdiction (IRS Employer (Primary Standard Industrial
of incorporation or Identification Number) Classification Code Number)
organization)
200 Camino Aguajito, Suite 200
Monterey, CA 93940
(831) 375-6229
(Address, including zip code, and telephone number, including area code,
registrant's principal executive offices)
--------------------------
Natalie Shahvaran
200 Camino Aguajito, Suite 200
Monterey, CA 93940
(831) 375-6229
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies of all communications to:
Gary R. Blume, Esq.
Blume Law Firm, P.C.
11801 North Tatum Boulevard, Suite 108
Phoenix, Arizona 85028-1612
Approximate date of commencement of proposed public offering: As soon as
practicable after this registration statement is effective.
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.
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, check the following box. [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
1
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of each Proposed
class of Amount Maximum Proposed Amount of
Securities to to be Offering Price Maximum Registration
be registered Registered Per Share (1) Offering Price (1) Fee
<S> <C> <C> <C> <C>
Common Stock, 150,000 $2.00 $300,000.00 $88.50
$0.01 par value
Total 150,000 $2.00 $300,000.00 $88.50
</TABLE>
(1) Estimated solely for calculation of the amount of the registration fee
calculated pursuant to Rule 457(c).
The Exhibit Index appears on page 33 of the sequentially numbered pages of
this Registration Statement. This Registration Statement, including exhibits,
contains 63 pages.
2
<PAGE>
TABLE OF CONTENTS
Cover Page 4
Available Information 5
Prospectus Summary 5
The Company 5
The Offering 5
Summary Financial Information 6
Risk Factors 7
Use of Proceeds 9
Determination of Offering Price 10
Dilution 10
Plan of Distribution 10
Legal Proceedings 11
Directors, Executive Officers, Promoters and
Control Persons 11
Security Ownership of Certain Beneficial
Owners and Management 11
Description of Securities 12
Interest of Named Experts and Counsel 13
Description of Business 13
Management's Discussion and Analysis of
Results of Operations and Financial Condition 18
Description of Property 18
Certain Relationships and Related Transactions 18
Market for the Registrant's Common Equity and Related
Stockholder Matters 19
Executive Compensation 19
Summary Compensation Table 19
Financial Statements 20
Experts and Legal Matters 32
Indemnification of Directors and Officers 32
Other Expenses of Issuance and Distribution 32
Recent Sales of Unregistered Securities 33
Exhibit Index 33
Signatures 34
3
<PAGE>
Initial Public Offering Prospectus
TRADING SOLUTIONS.COM, INC.
200 Camino Aguajito
Suite 200
Monterey, California 93940
150,000 Shares of Common Stock
$2.00 Per Share
We will be selling all of the 150,000 shares of common stock offered in
this offering and will not use an underwriter nor pay a commission for the sale
of the shares. This is our initial public offering, and no public market
currently exists for our shares. The offering price may not reflect the market
price of our shares after the offering.
This Investment Involves a High Degree of Risk.
You Should Purchase Shares Only If You Can Afford a Complete Loss.
See "Risk Factors" beginning on page 6 for a discussion of certain factors that
should be considered by investors.
Neither the Securities and Exchange Commission nor any sate securities
commission has approved or disapproved these securities, or determined if this
Prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
<TABLE>
The Offering
<CAPTION>
Price to Public Proceeds to Company
<S> <C> <C>
Per Share $ 2.00 $ 300,000
Total $ 2.00 $ 300,000
</TABLE>
You should rely only on the information contained in this document. We have
not authorized anyone to provide you with information that is different.
4
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission a
Registration Statement on Form SB-2 under the Securities Act of 1933 with
respect to the Common Stock offered hereby. This Prospectus does contain all of
the information set forth in the Registration Statement and the exhibits and
schedules to the Registration Statement. The Registration Statement, including
exhibits and schedules thereto, as well as the reports and other information
filed by the Company with the Securities and Exchange Commission, may be
inspected without charge at the Public Reference Room of the Securities and
Exchange Commission's principal office at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the Securities and Exchange Commission's
regional offices at 13th Floor, Seven World Trade Center, New York, N.Y. 10048,
and Suite 1400, Citicorp Center, 500 West Madison Street, Chicago, Illinois
60661. Copies of such material can also be obtained at prescribed rates from the
Public Reference Section of the Securities Exchange Commission at Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. Electronic filing made
through the Electronic Data Gathering Analysis and Retrieval System are also
publicly available through the Securities and Exchange Commission's Web site
(http://www.sec.gov).
Investors are cautioned that this registration statement contains certain
trend analysis and other forward looking statements that involve risks and
uncertainties. Words such as "expects," "anticipates," "intends," "plans,"
"believes," "seeks," "estimates," variations of such words and similar
expressions are intended to identify such forward looking statements. These
statements are based on current expectations and projections about the
healthcare industry and assumptions made by management and are not guarantees of
future performance. Therefore, actual events and results may differ materially
from those expressed or forecasted in the forward looking statements due to
factors such as the effect of changing economic conditions, material changes in
currency exchange rates, conditions in the overall healthcare market, risks
associated with product demand and market acceptance risks, the impact of
competitive products and pricing, delays in new product development and
technological risks and other risk factors identified in the Company's filings
with the Securities and Exchange Commission, including the Company's Form 10-K
Report.
PROSPECTUS SUMMARY
This summary highlights the material aspects of the offering that should be
considered by a prospective investor.
THE COMPANY
Trading Solutions.com, Inc. is an educational company instructing people in
online investing. The Company offers a wide range of educational programs
designed for people of different ages, backgrounds, and goals.
THE OFFERING
<TABLE>
<CAPTION>
<S> <C>
Securities Being Offered 150,000 Shares of Common Stock
Common Stock Outstanding
Before this Offering 2,700,000 Shares of Common Stock
Common Stock Offered
by this Company 150,000 Shares
Common Stock Outstanding
After this Offering 2,850,000 Shares
</TABLE>
5
<PAGE>
Use of Proceeds
The Company intends to earn $300,000 from the sale of the securities. The
Company will rely on the proceeds from this offering to pay legal and accounting
fees and obtain working capital. The Company will spend $100,000 on new school
openings and $ 100,000 on advertising when its website becomes operating. The
remaining proceeds will be used to develop and maintain the website as well as
the online store. See "Use of Proceeds".
Risk Factors
This is a start-up company subject to federal and state regulation. This
registration involves the sale of up to 150,000 shares of common stock of the
Company. Past investors received the protection of the regulations regarding
restricted securities and the inability of the holder to freely trade those
securities. With this registration the securities will be freely tradeable and
may cause negative impact on the market. See "Risk Factors."
SUMMARY FINANCIAL INFORMATION
The following tables set forth the summary financial information and other
equity information of the Company. The summary financial information in the
tables is derived from the financial statements of the Company and should be
read in conjunction with the financial statements, related notes and other
financial information included herein. See "Management's Discussion and Analysis
of Results of Operations and Financial Condition" and "Financial Statements."
<TABLE>
Statement of Operations Data
<CAPTION>
Period Ended
June 30, 1999
<S> <C>
Revenues 32,290
Expenses
General and Administrative (31,476)
Total Expenses (31,476)
Other Income and Expenses
Interest Income (14)
Net Loss
Net Loss Available to
Common Stockholders
Net (Loss) Per Share of
Common Stock (0.012)
</TABLE>
<TABLE>
<CAPTION>
Period Ended
June 30, 1999
Balance Sheet Data:
<S> <C>
ASSETS
Current assets
Cash in bank $ 17,381
Prepaid rent 677
Total current assets 18,058
Furniture and equipment
Equipment 2,206
Furniture 600
2,806
Accumulated depreciation (44)
2,762
Total assets $ 20,820
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities
Accounts payable $ 5,770
State corporate tax liability 800
Total current liabilities 6,570
Total liabilities 6,570
Stockholders' equity
Common stock, 20,000,000 shares authorized at a
par value of 0.01 (2,627,000 outstanding) 26,270
Paid in capital 20,270
Deficit incurred during development stage (32,290)
Total stockholder's equity 14,250
Total liabilities and
stockholder's equity $ 20,820
</TABLE>
6
<PAGE>
RISK FACTORS
The securities being offered hereby involve a substantial risk. An
individual considering the purchase of the Shares should give consideration to
the following risk factors:
Lack of Operating History
The Company is a development stage company organized in 1999. Since the
Company has not proven the essential elements of profitable operations, you will
be furnishing venture capital to the Company and will bear the risk of complete
loss of your investment in the event the Company's business plan is
unsuccessful. The Company has only limited experience and is expanding its
operations , which may or may not provide profits to the Company. The Company
had no revenue as of June 30, 1999. The Company has also not been profitable,
having an accumulated loss of $32,290 through June 30, 1999.
NASDAQ Listed Securities - Low Priced Securities
The Company is not listed on any stock exchange at this time. The Company
will make application to NASD to become a bulletin board listed company. These
are known as "penny stocks" and are subject to various regulations involving
certain disclosures to be given to you prior to the purchase of any penny
stocks. These disclosures require you to acknowledge you understand the risk
associated with buying penny stocks and that you can absorb the entire loss of
your investment. Penny stocks are low priced securities that do not have a very
high trading volume. Because of this the price of the stock is volatile and you
may not be able to buy or sell the stock when you want.
No Public Market
At this time no market exists for the sale or purchase of the common stock.
After this registration is effective application will be made to list the common
stock on the NASD bulletin board exchange. Even when listed the number of shares
outstanding will not be enough to provide the large volume of trading that will
enable the share price to be stable. The risk to you is that you may not be able
to sell or buy the stock when you want.
7
<PAGE>
Uncertainty Due to Year 2000 Problem
The Year 2000 issue arises because many computerized systems use two digits
rather than four to identify a year. Date sensitive systems may recognize the
year 2000 as 1900 or some other date, resulting in errors when information using
the year 2000 date is processed. Similar problems may arise in some systems
which use certain dates in 1999 to represent something other than a date. The
effects of the Year 2000 issue may be experienced before, on, or after January
1, 2000, and if not addressed, the impact on operations and financial reporting
may range from minor errors to significant system failure which could affect the
Company's ability to conduct normal business operations. This creates potential
risk for all companies, even if their own computer systems are Year 2000
compliant. It is not possible to be certain that all aspects of the Year 2000
issue affecting the Company, including those related to the efforts of
customers, suppliers, or other third parties, will be fully resolved.
The Company currently believes that its systems are Year 2000 compliant in
all material respects, its current systems and products may contain undetected
errors or defects with Year 2000 date functions that may result in material
costs. Although management is not aware of any material operational issues or
costs associated with preparing its internal systems for the year 2000, the
Company may experience serious unanticipated negative consequences (such as
significant downtime for one or more of its website properties) or material
costs caused by undetected errors or defects in the technology used in its
internal systems. The purchasing patterns of advertisers may be correct their
current systems for Year 2000 compliance. The company does not currently have
any information about the Year 2000 status of its advertising customers. These
expenditures may result in reduced funds available for web advertising or
sponsorship or web services, which could have a material adverse effect on its
business, operations and financial condition.
No Market Studies
In formulating its business plan, the Company has relied on the judgment of
its officers, directors and consultants. No formal independent market studies
concerning the demand for the Company's proposed services have been conducted,
nor are any planned. The effect of the sale of the Securities has not been
analyzed for its effect on the operations of the Company, the ability of the
Company to obtain funds or financing or the variations in share price due to
additional shares being available for sale.
Continued Control by Existing Management
The Company's management currently owns 1,250,000 of shares of common stock
of the Company and Internet Finance.com, Inc. owns 1,210,000 shares. This
represents 44% and 43% of the outstanding shares of the Company's common stock
if all shares are sold. If the officers and Internet Finance.com, Inc. vote in
the same manner, they will retain control over all affairs of the Company,
including the election of the directors and business transactions.
Dividends
The Company's Board of Directors presently intends to cause the Company to
follow a policy of retaining earnings, if any, for the purpose of increasing the
net worth and reserves of the Company. Therefore, there can be no assurance that
any holder of Common Stock will receive any cash, stock or other dividends on
his shares of Common Stock. Future dividends on Common Stock, if any, will
depend on future earnings, financing requirements and other factors. Since the
time of inception the Company has paid no dividends to shareholders.
Dependance on Executive Officers
The Company is highly dependent on the services of its officers. Attracting
and retaining qualified personnel is critical to the Company's business plan. No
assurances can be given that the Company will be able to retain or attract such
qualified personnel or agents, or to implement its business plan successfully.
Should the Company be unable to attract and retain the qualified personnel
necessary, the ability of the Company to implement its business plan
successfully would be limited.
8
<PAGE>
Dilution to Shareholders
The securities currently held by investors will be subject to dilution in
market value as more securities are issued. The Company is authorized to issue
20,000,000 shares of common stock. When this offering is completed 2,850,000
shares will be outstanding. The Company will have 17,172,500 shares remaining to
be issued. You will have 5.3% of the outstanding shares of the Company
immediately after this offering. Should the additional 17,172,500 shares be
issued you will have .75% of the outstanding shares of common stock.
Going Concern Status
The Company is a developments stage Company as defined in Financial
Accounting Standards Board Statement No. 7. The Company is devoting
substantially all of its present efforts in establishing a new business and
although planned principal operations have commenced, there have been no
significant revenues. Management's plans regarding the matters which raise
doubts about the Company's ability to continue as a going concern are disclosed
in Note 1 to the financial statements. These factors raise substantial doubt
about its ability to continue as a going concern. The consolidated financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
Arbitrary Offering Price
Before the offering made hereby, there has been no market for the Company's
Common Stock. The offering price of the Shares has been arbitrarily determined
by the Company and bears no relationship to assets, book value, net worth,
earnings, actual results of operations, or any other established investment
criteria. Among the factors considered in determining such offering price were
the Company's current financial condition, the degree of control which the
current shareholders desired to retain, and an evaluation of the prospects for
the Company's growth.
Success Dependant On Growth Of Internet Related Industries
Our future growth will greatly depend upon continued growth in the use of
the Internet. Even though our online school and our e-commerce business will not
be the only sources of income for the Company, we are uncertain if the Company
can maintain the profit and growth level expected. Some of the issues concerning
the increased use of the Internet include reliability, cost, access, and
security, which may affect further development of online services and electronic
commerce in general, as well as the market for our services and products.
Potential Loss of Investment
As with an investment in any emerging growth company, ownership of common
shares of the Company may involve a high degree of risk, and this investment is
not recommended if you cannot reasonably bear the risk of a total loss of your
investment.
USE OF PROCEEDS
The Company will rely on the proceeds from this offering to open additional
schools, advertise, acquire an e-commerce business and pay legal and accounting
fees. The following table summarizes the use of proceeds:
<TABLE>
<CAPTION>
<S> <C>
Open and Maintain Schools (two to three) $100,000*
Advertising $100,000
Acquire e-commerce Business $ 50,000
Legal and Accounting $ 20,000
Web Site Development $ 30,000
Total $300,000
</TABLE>
*This will include salaries paid to officers. This estimate is for three
schools.
Any funds not used for the purposes indicated will be used for general working
capital.
9
<PAGE>
DETERMINATION OF OFFERING PRICE
Because there has been no prior public trading market for our common stock,
the initial public offering price of the common stock has been determined by
management and is not necessarily related to our asset value, net worth or other
criteria of value. The factors considered in determining the offering price
include an evaluation by management of the history of and prospects for the
industry in which we compete and our earnings prospects. Factors such as our
financial results, announcements of developments related to our business, and
the introduction of products and product enhancements by ourselves or our
competitors may have a significant impact on the market price of our securities.
DILUTION
As of July 31, 1999, the Company had issued 2,700,000 shares of Common
Stock and the net tangible book value per share of the Common Stock (the
Company's net tangible assets less its liabilities divided by the number of
shares of Common Stock then outstanding) was $.0078 per share of Common Stock.
After giving effect to the receipt of the estimated net proceeds from the sale
of all of the Shares, and assuming that the offering price of the Shares is
$2.00 per Share, you will have paid a total of $300,000 for 150,000 shares of
Common Stock and the net tangible book value of the Company's presently
outstanding shares will increase to $0.1135 per share. The investors will
experience a corresponding dilution of $1.8865 per share from the offering
price. If a smaller number of Shares is sold, the dilution to the investors will
be greater than that indicated above as indicated in the table below.
The following table illustrates the per share dilution to you:
<TABLE>
<CAPTION>
<S> <C>
Offering Price per share .................................................. $2.0000
Net tangible book value per share before offering ...................... $0.0078
Increase in net tangible book value per share attributable
to investors purchasing in this offering ............................ $0.1057
Pro forma net tangible book value per share after offering ................ $0.1135
Dilution per share ........................................................ $1.8865
</TABLE>
The following table summarizes the differences between existing
shareholders, as of July 31, 1999, and new investors with respect to the number
of Common Shares purchased from the Company, the total consideration paid and
the average price per share:
<TABLE>
<CAPTION>
Shares Purchased Total Consideration Paid Average Price
Number Percent Amount Percent Per Share
<S> <C> <C> <C> <C> <C>
Existing Shareholders 2,700,000 95% $ 70,995 19% $0.0263
New Investors 150,000 5% $ 300,000 81% $2.0000
Total 2,850,000 100% $ 370,995 100%
</TABLE>
PLAN OF DISTRIBUTION
The securities are being offered for sale by us through our officers and
directors. We intend to engage the services of a registered broker or dealer in
each state that requires that a registered broker or dealer act on behalf of a
company selling its own securities in that state. The offering is a
"best-efforts" offering and will conclude at the discretion of the Company, or
sooner if all the shares are sold. No underwriter has been engaged and no
commitment to provide the funds has been made.
10
<PAGE>
LEGAL PROCEEDINGS
The Company is not a party to any pending legal proceedings.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The following information sets forth the names of the officers and
directors of the Company, their present positions with the Company and
biographical.
Natalie Shahvaran (Age 22). President, Chief Executive Officer, Chief Operating
Officer, Director. Ms. Shahvaran graduated from Heald Business College with
honors and received her Associate's Degree in Computer Business Administration
in 1999. The associate's degree is a two year professional vocational degree.
She has been managing her family trading account with an online discount
brokerage. She was working as a computer consultant for Monterey Ventures, Inc.
from 1998 to 1999. Monterey Ventures is a venture capital and financing company
for small companies.
Michael A. Strahl (Age 40). Secretary, Director. Mr. Strahl graduated from
Western State College and received his BA in Business Administration/Finance. He
was the Vice President and Director of Themiis Corporation, a merchant bank
specializing in environmental management from 1997 to 1999. He was Vice
President and Chief Operating Officer of Environmental Enzymes, Inc., an enzyme
manufacturing company from February 1999 to July 1999. He is currently on the
board of directors of Internet Finance.com, Inc. and Monterey Technologies, Inc.
Michael A. Strahl is also a part owner and board member since March of 1994 of
the Environmental Business Network. Inc., an environmental solutions oriented
company. He was President of Environmental and Energy Group, Inc. (EEG),
consultant to the oil and gas industry from 1992 to 1993. Before joining the
environmental industry, Michael A. Strahl was a NASD Principal with various
stock brokerage firms.
Susan Turner (Age 44). Chief Financial Officer, Treasurer, Director. Ms. Turner
attended the University of Michigan School of Business Administration and
received her BA in Business Administration in April 1975. She graduated with a
major in Accounting. Ms. Turner passed the CPA exam in November 1975 and
obtained a Michigan CPA license April 1978, a Georgia license September 1980 and
a California license December 1985. Ms. Turner is currently a Certified Public
Accountant. Ms. Turner started her professional career over 20 years ago with
Peat, Marwick, Mitchell, a national CPA firm from September 1975 to April 1977.
She was also audit manager for the Commercial Loan Department of General
Electric Credit Corporation in Palo Alto, CA. Ms. Turner previously managed the
tax department of McGilloway & Elstob in California from December 1984 to
September 1987, and has been the proprietor of her own CPA firm since 1987. Ms.
Turner will handle the Corporation's financial matters, including financial
statement preparation, tax returns, budgeting and forecasting.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of July 31, 1999, the beneficial
ownership of the Company's Common Stock by each person known by the Company to
beneficially own more than 5% of the Company's Common Stock outstanding as of
such date and by the officers and directors of the Company as a group. Except as
otherwise indicated, all shares are owned directly.
11
<PAGE>
<TABLE>
<CAPTION>
(1) (2) (3) (4)
Name and address of Amount and Nature Percent of
Title of Class beneficial owner Of Beneficial Ownership(1) Class(2)
<S> <C> <C> <C>
Common Stock Natalie Shahvaran 1,250,000 46%
P.O. Box 22851
Carmel, CA 93922
Common Stock Internet Finance.com, Inc.(2) 1,210,000 45%
200 Camino Aguajito
Number 200
Monterrey, CA 93940
Common Stock Monterrey Ventures, Inc.(2) 50,000
200 Camino Aguajito
Number 200
Monterrey, CA 93940
Common Stock Michael A. Strahl 20,000
814 Bel Air Way
Salinas, CA 93901
Common Stock Susan F. Turner 20,000
P.O. Box 3687
Carmel, CA 93921
Common Stock Directors and Officers 1,290,000 46%
as a group (3 persons)
</TABLE>
(1) The beneficial ownership includes shares issued at the effective date of
this offering.
(2) The percent of class is before the offering. After the offering Natalie
Shavaran will have 44% and Internet Finance.com, Inc. will have 43%.
(3) Robert Strahl, father of Michael Strahl, officer and director of the Company
is the beneficial owner of the shares of common stock issued to Internet
Finance.com, Inc.
DESCRIPTION OF SECURITIES
Common Stock
The Company is authorized to issue 20,000,000 shares of common stock with a
par value of $0.01 per share. Currently 2,700,000 shares are outstanding and no
options or warrants remain outstanding and no shares are reserved for any
options or warrants. Holders of the Common Stock are entitled to one vote for
each share held by them of record on the books of the Company in all matters to
be voted on by the stockholders. Holders of Common Stock are entitled to receive
such dividends as may be declared from time to time by the Board of Directors
out of funds legally available, and in the event of liquidation, dissolution or
winding up of the Company, to share ratably in all assets remaining after
payment of liabilities. Declaration of dividends on Common Stock is subject to
the discretion of the Board of Directors and will depend upon a number of
factors, including the future earnings, capital requirements and financial
condition of the Company. The Company has not declared dividends on its Common
Stock in the past and the management currently anticipates that retained
earnings, if any, in the future will be applied to the expansion and development
of the Company rather than the payment of dividends.
12
<PAGE>
The holders of Common Stock have no preemptive or conversion rights and are
not subject to further calls or assessments by the Company. There are no
redemption or sinking fund provisions applicable to the Common Stock. The Common
Stock currently outstanding is, and the Common Stock offered by the Company
hereby will, when issued, be validly issued, fully paid and nonassessable.
Voting Requirements
The Articles of Incorporation require the approval of the holders of a
majority of the Company's voting securities for the election of directors and
for certain fundamental corporate actions, such as mergers and sales of
substantial assets, or for an amendment to the Articles of Incorporation. There
exists no provision in the Articles of Incorporation or Bylaws that would delay,
defer or prevent a change in control of the Company.
Transfer Agent
The transfer agent and registrar for the Company's Common Stock is
Silverado Stock Transfer, Inc., 8170 S. Eastern Avenue, Suite 4, PMB 602, Las
Vegas, NV, 89123. Its telephone number is (702) 263-0920.
Shares Eligible for Future Sale
As of July 31, 1999, the Company had 2,700,000 shares of Common Stock
outstanding. Of the 2,700,000 shares of Common Stock outstanding, 2,500,000
shares of Common Stock are beneficially held by "affiliates" of the Company. All
shares of Common Stock registered pursuant to this Registration Statement will
be freely transferable without restriction or registration under the Securities
Act, except to the extent purchased or owned by "affiliates" of the Company as
defined for purposes of the Securities Act.
In general, under Rule 144 as currently in effect, a person who has
beneficially owned "restricted" securities for at least two years, including
persons who may be deemed to be "affiliates" of the Company, may sell publicly
without registration under the Securities Act, within any three-month period,
assuming compliance with other provisions of the Rule, a number of shares that
do not exceed the greater of (i) one percent of the Common Stock then
outstanding or, (ii) the average weekly trading volume in the Common Stock
during the four calendar weeks preceding such sale. A person who is not deemed
an "affiliate" of the Company and who has beneficially owned shares for at least
three years would be entitled to sell such shares under Rule 144 without regard
to the volume and other limitations described above.
INTEREST OF NAMED EXPERTS AND COUNSEL
The Company's securities counsel, Blume Law Firm, P.C., of Phoenix, Arizona
currently holds 10,000 shares of our common stock.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
The Company has indemnified all officers, directors and controlling persons
of the Company against all liabilities from the sale of securities which might
arise under the Securities Act of 1933 other than as stated under Nevada law.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to such persons pursuant to the foregoing provisions, the
Company has been informed that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Act and is therefore unenforceable.
DESCRIPTION OF BUSINESS
The following discussion and analysis of our plan of operation should be
read in conjunction with the more detailed financial information contained in
our financial statements and the notes thereto included elsewhere in this
prospectus. This prospectus contains forward-looking statements that involve
risks and uncertainties. Our actual results may differ materially from the
results discussed in the forward-looking statements.
13
<PAGE>
Overview
- --------
The Company is a development stage company, which is establishing an online
trading school along with several trading schools in California. The Company
will also sell services and products through its online store. Students and
shoppers will be able to purchase our services through our web site at
www.tradingsolutionsinc.com. Our web site is currently under development and is
expected to be operational by the end of 1999.
The Company was incorporated on May 14, 1999 by seven persons or entities
contributing $0.001 per share for 2,495,000 shares of common stock. The Company
also received funds from the exercise of options to purchase 85,000 shares of
common stock for $0.10 per share and the sale of a Regulation D private
placement of 120,000 shares for $0.50 per share. This provided the
capitalization of the Company.
The Company has not yet begun operating and has no revenue. Since
inception, the Company has been engaged in developing corporate structure,
planning operations, capital raising activities, and negotiating agreements with
prospective business affiliates. The Company has no operating revenue to date.
Cash Requirements and Additional Funding
- ----------------------------------------
Although management believes that the proceeds from this offering will
satisfy the Company's cash requirements for the next twelve months, management
anticipates an increase in capital expenditures consistent with anticipated
growth in operations, infrastructure and personnel. The Company will also
continue to expand marketing and development programs. The money needed will
depend on the market acceptance of the online training program and the costs to
maintain and upgrade the web site.
Additional Research and Development
- -----------------------------------
The Company will not have significant research and development expenses
during the next 12 months. The development of the web site design will be
achieved through modifications of available technologies.
The Company will hire technical personnel to service the web site when
funds become available. Until then the Company will be required to engage the
services of a third party to develop the web site. The Company anticipates that
the total cost of such services will be $30,000.
Business
- --------
The Company intends to work on two projects.
1. Trading Solutions.com, Inc. trading school is designed to provide
education for people interested in online investing. The Company will offer
training for beginners as well as experienced traders. Courses will consist of a
combination of theory sessions linked closely with a practical hands-on
approach. The Company will provide online training, individual training, small
group sessions and seminars on various trading and computer related subjects.
2. The Company intends to establish or acquire an e-commerce business and
link it with the online trading school. The Company will offer a wide variety of
products for investors, including books, magazines, newspapers, online
newsletters and trading software packages.
Overview of Internet-Based Industry
- -----------------------------------
Online trading is becoming more and more popular among people of different
ages, education, professions, and backgrounds. Trading Solutions.com, Inc. is
aiming at persons interested in investing but not familiar with computers or the
Internet, as well as existing traders who would like to improve their trading
techniques.
According to the Spring 1999 edition of Women In Touch magazine, "...there
are approximately 7 million online accounts registered with U.S. brokerages, and
about 350,000 trades taking place each and every day. By the end of year, the
number of online account is expected to top 10 million." The same magazine
states, according to National Foundation for Women Business Owners, a majority
of women entrepreneurs are looking into investing online. Trading Solutions.com,
Inc. intends to offer its services to this group of investors.
14
<PAGE>
Financial Service Online May 1999 edition also mentions that, according to
a recent report from Credit Suisse First Boston Corp., the number of online
trades grew by almost 35% during the first quarter of 1999. This growth came
following a 34% growth in the fourth quarter of 1998.
Investment News from 5/17/99 says that as much as 19% of households with
$750,000 or more investment money will be trading online, up 5% from 1997.
According to the same magazine, the amount of American households investing
through online brokerage accounts will rise from 2.4 million at the end of 1998
to 4.3 million by the end of 2000.
By the year 2003 worldwide Internet Commerce will approach $3.2 trillion
and represent nearly 5% of all global sales, according to Small Business
Computing, "ABC's of E-Commerce", March, 1999. Another article, "Cyberspace
Marketplace" from Time Magazine, 7/20/98, says that by the year 2000, an
estimated 1 in 4 families will be buying general merchandise online.
Marketing Strategies
- --------------------
Media Advertising
- -----------------
The Company's marketing strategy is directed towards beginners and
experienced traders. Management will work to establish a local market niche for
each one of its trading schools by advertising in local newspapers and radio.
Management will work to increase the public's awareness of the Company's name
and its services. This goal is to be achieved by carefully positioned editorials
regarding the Company's services. Special events will be sponsored from which
name affiliation and public familiarity with the services and products offered
can be achieved.
Radio and Television Advertising
- --------------------------------
The Company will optimize advertising dollars spent on radio by purchasing
air time from those radio stations whose demographics most closely resemble the
Company's clientele. Management will be responsible for contacting account
executives from various local stations and requesting proposals and statistics
regarding their station's listeners and advertising packages.
Internet and Print Advertising
- ------------------------------
The Company intends to advertise on the Internet through its web page,
which will be updated regularly. The Company will also maintain advertisements
in the local newspapers. The Company will also produce color catalogs to be
printed and distributed throughout the year.
Business Strategy
- -----------------
We want to become a leading online training school combined with an online
store for a one stop learning experience. The Company will offer classes and
information with current technological information. We intend to affiliate with
professional traders to teach our online classes and seminars. Currently, the
information most in demand includes online trading, electronic trading, day
trading strategies, and the software applied in trading. We intend to offer as
many types of training and as great a variety within each subject category as
possible. We also intend to invest in our web site infrastructure. We will offer
our students access to our online store to make it easy for them to purchase
everything they need for trading and investing online. Through the online store
linked with the online school, we intend to offer products such as literature
and newspapers, books, newsletters and reader's digests, along with the trading
software packages that would specifically target online investors.
To promote learning through Trading Solutions.com, we intend to incorporate
certain features in the online school. We will update our web site to ensure
that the site is interesting and offers current information.
15
<PAGE>
Sources of Revenue
- ------------------
Tuition
- -------
During the first stage of operations, revenues will be derived primarily
from the tuition paid by the students attending our schools, in person or
through the Internet.
The Company is planning to open three or four schools in the Bay Area in
California. Up to $100,000 of the funds raised through this offering will be
used to open these schools. This provides excess funds beyond the $20,000
estimate of the cost of opening the schools. We will know immediately if the
estimates are accurate and will modify the number of sites accordingly.
The number of training facilities which will actually open may be adjusted
in accordance with the amount of available funds. Once identified, the time to
develop a particular location varies, depending on the circumstances at each
site. A training facility can be completed in 30 to 60 days from the beginning
of the design phase. The Company's investment in a location will range from
$15,000 to $20,000 to acquire all the furniture, equipment, supplies, have some
advertising to bring the location to the point where it can be profitable. We
believe that our training facilities will not require additional funding after
the initial investment is made.
An online training school can begin operating as soon as the software and
the web site are developed for the Company. The Company is planning to establish
or acquire an Internet commerce business at an estimated cost of $50,000 to
$75,000. Profits generated from online sales are expected to be moderate and
provide additional capital for the Company's growth. The Company will be forced
to develop this software if an acquisition cannot be made or pay a third party
to develop the software.
A possible local web site development company, Net-Clients.com could
develop a web site that will load to any commercially available Internet
browsers and have an e-commerce capability. Net-Clients.com could develop
software that would allow broadcasting of classes over the Internet with
existing technology. We will spend up to $30,000 of the funds raised on our web
site development.
Our goal is to become a profitable online trading school. We intend to
affiliate with professional traders and financial advisors to teach our classes.
We will offer books, video and audio learning courses by leading authors, and as
many types of such products, and as wide a variety within each product category,
as possible. We will also adopt features that would attract and retain students
by offering different levels of training to address the needs of people with
different backgrounds and computer experience. We will offer basic computer
classes to prepare the students who are not familiar with the Internet.
Competition
- -----------
While there are several experienced online traders who offer seminars not
all operate in our target market segment. Developing strategies to take market
share away form these limited number of competitors is, in fact, the marketing
approach. Based on this marketing premise, we are not really competing with the
overpriced, short-term trading seminars. The strategy is to demonstrate a very
high perceived value to price ratio to a wide segment of potential customers
that are looking for personalized, professional instructing, without the
obstacle of a high price. We believe that the competition at this level is
limited. Some of the companies offering trading seminars are charging from $900
to $3,500 per seminar. Our basic computer and online trading courses for the
beginners will be priced at $120 to $175 per course. More advanced trading
seminars and classes will be offered to the public at $400 to $700 per course.
HL Camp & Company offer trading seminars at $1,095 each, Legend Trading
Seminars cost $2,895 per seminar, ActiveTrade day trading classes are priced at
$3,500. Most of the seminars are oriented specifically on the day trading and
are of no use to the people who would like to invest online. We are not aware of
any trading schools in the Bay area that would offer all or similar services to
students. The Company will provide its customers with choices, which span
different levels of readiness while also offering basic computer training and
possible online training.
16
<PAGE>
The Company also faces competition from other web sites that provide online
investment training. We believe that by offering an all-in-one service and
providing students with the ability to purchase all the educational materials
through the web site, the Company can successfully compete in this market. We
believe that online trading education market is not saturated and has great
expansion potentials.
Government Regulation
- ---------------------
We are not currently subject to direct regulation by any government agency,
other than regulations applicable to businesses generally or applicable to
electronic commerce. There is a chance that as the Internet becomes more
popular, new laws and regulations may be issued, which will affect companies
conducting business through the Internet. We believe that the new laws and
regulations covering consumer protection, security and privacy issues will
benefit the consumers and make people more comfortable receiving services
online. The Government may also impose additional taxes on the sales conducted
over the Internet, which will increase the cost of the operation.
Intellectual Property Rights
- ----------------------------
No licenses or patents are required for our business. The only
confidentiality is our trading system and portfolio positions, which are only
disclosed to the board members. The board of directors and secretarial staff
have all signed confidentiality and a non-disclosure agreements.
Employees
- ---------
As of June 29, 1999, the Company had no full time employees. Board Members
and Officers are devoting their time and effort to developing and promoting the
Company. Chief Executive Officer, Natalie Shahvaran is devoting 40 hours per
week to the affairs of the Company. Directors, Michael A. Strahl and Susan F.
Turner devote a minimum of 8 hours each per week. The Company is also using the
services of several consultants. Additional employees will be hired as required.
Year 2000 Issues
- ----------------
The Year 2000 issue arose because many existing computer programs use only
the last two digits to refer to a year. Therefore, these computer programs do
not properly recognize a year that begins with 20 instead of 19. If not
corrected, many computer applications could fail or create erroneous results.
Management has initiated a comprehensive program to prepare the Company's
systems for the year 2000. The Company is actively engaged in testing and fixing
applications to ensure they are Year 2000 ready. The Company does not separately
track the internal costs incurred for the Year 2000 project, but such costs are
principally the related payroll costs for certain corporate staff. The Company
currently does not expect remediation costs to be material nor does it expect
any significant interruption to its operations because of Year 2000 problems.
The Company is in the process of contacting all third parties with which it
has significant relationships, to determine the extent to which the Company
could be vulnerable to failure by any of them to obtain Year 2000 compliance.
Some of the Company's major suppliers and financial institutions have confirmed
that they anticipate being Year 2000 compliant on or before December 31, 1999,
although many have only indicated that they have Year 2000 readiness programs.
To date, the Company is not aware of any significant third parties with a Year
2000 issue that could materially impact the Company's operations, liquidity or
capital resources. The Company has no means, however, of ensuring that third
parties will be Year 2000 ready and the potential effect of third-party
non-compliance is currently not determinable.
The Company has devoted and will continue to devote the resources necessary
to ensure that all Year 2000 issues are properly addressed. There can be no
assurance, however, that all Year 2000 problems are detected. Further, there can
be no assurance that the Company's assessment of its third party relationships
could be accurate. Some of the potential worst-case scenarios that could occur
include (1) corruption of data in the Company's internal systems and (2) failure
of government and insurance companies' reimbursement programs. If any of these
situations were to occur, the Company's operations could be temporarily
interrupted. The Company intends to develop Year 2000 contingency plans for
continuing operations in the event such problems arise.
17
<PAGE>
The Company's executive offices are located at 200 Camino Aguajito, suite
200, Monterey, CA, 93940. Its telephone number is (831) 375-6229.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
When used in this discussion, the words "believes", "anticipates",
"expects" and similar expressions are intended to identify forward-looking
statements. Such statements are subject to certain risks and uncertainties,
which would, could cause actual results to differ materially from those
projected. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.
Results of Operations
The Company had no revenues for the period ending July 31, 1999. To date
the Company has not relied on any revenues for funding its activities and it
does not expect to receive revenues from operations to be profitable for at
least six months following the receipt of the funds raised through this
offering. We believe that the proceeds from this offering will satisfy the
Company's cash requirements for the next twelve months. The Company is also
relying on revenues received from its business. The Company anticipates an
increase in capital expenditures consistent with anticipated growth in
operations, infrastructure and personnel. The Company will also continue to
expend marketing and development programs.
Liquidity and Capital Resources
The Company does not believe that there will be significant research and
development expenses during the next 12 months. Even though we have contracted
an independent company to develop our web site design, this development will be
achieved through modifications of available technologies. Expenditures on
activities of this type do not constitute research and development expenses.
The Company expects to hire technical personnel to service the web site as
soon as sufficient funds become available either as a result of this offering,
or from the profits gained through the Company's operations. Until then the
Company will be required to engage the services of a third party to develop the
web site. The Company anticipates that the total cost of such services will be
$30,000.
The Company does not anticipate purchasing or selling any plant or
significant equipment during the next twelve month. We also to hire up to ten
additional employees by the end of our first 12 months of operations. These
additional employees may serve in any of the following capacities: teaching;
marketing and promotion; administration; and web site technicians.
DESCRIPTION OF PROPERTY
Presently, no equipment or properties except basic computer equipment are
owned. The Company anticipates purchasing additional computer equipment for
training and trading. In addition, office furniture and office equipment that
will be needed to conduct business instruction in trading will be purchased. The
funds will come from this offering.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On May 13th, 1999, Trading Solutions.com has entered into an Investment
Banking Agreement with Internet Finance.com, Inc. Under this agreement, Internet
Finance.com, Inc. was to assist the Company in the corporate formation, business
and strategic plan, assist in the areas of management structure, line
projections and marketing. Internet Finance.com, Inc. has also provided the
Company with a $3,000 bridge loan, which was repaid by the Company on June 1,
1999. Internet Finance.com, Inc. purchased 1,200,000 shares of common stock at
$.001 per share. Trading Solutions.com has also agreed to pay Internet
Finance.com, Inc. a consulting fee of $22,000 for its services. Michael A .
Strahl is the director designee appointed by Internet Finance.com under the
terms of the agreement.
18
<PAGE>
Ms. Natalie Shahvaran, who is an executive officer and a director of
Trading Solutions.com, Inc., was issued 1,200,000 shares of common stock at
$0.01 per share.
In May 1999, the Company agreed to issue options to purchase 85,000 shares
of Common Stock, which are exercisable at $.10 per share. As of August 1999,
85,000 shares were exercised. The aggregate proceeds from the exercise of the
stock options was $8,500. The following table summarizes the number of stock
options issued.
<TABLE>
<CAPTION>
NAME EXERCISE PRICE No OF SHARES
<S> <C> <C>
Natalie Shahvaran $.10 50,000
Susan F. Turner $.10 5,000
Michael A. Strahl $.10 5,000
Melissa DeAnzo $.10 5,000
Monterey Ventures, Inc. $.10 10,000
Internet Finance.com, Inc $.10 10,000
Total 85,000
</TABLE>
MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
Market Information
There is no public market for the Company's common stock.
Holders
As of July 31, 1999 there were approximately forty-four (44) stockholders
of record of the Company's Common Stock.
Dividend Policy
The Company has never paid a dividend and does not anticipate paying any
dividends in the foreseeable future. It is the present policy of the Board of
Directors to retain the Company's earnings, if any, for the development of the
Company's business.
EXECUTIVE COMPENSATION
The board has adopted an executive compensation plan for its Executive
Officers and Directors as follows: the board members will receive no cash
compensation or reimbursement for the expenses incurred in connection with
attending board meetings. The Company reserves the right to pay consulting fees
to its board members and officers for the time and services they provide to the
Company. Our Chief Executive Officer will receive up to $30,000 in compensation
for her full time commitment to the development and promotion of the company.
The Board has agreed to the issuance of the Company's common stock to three of
its members.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
NAME AND OTHER RESTRICTED SECURITIES ALL
PRINCIPAL ANNUAL STOCK UNDERLYING LTIP OTHER
POSITION YEAR SALARY COMPENSATION AWARD OPTIONS/SAR's PAYOUTS COMPENSATION
<S> <C> <C> <C> <C> <C> <C> <C>
Natalie Shahvaran 1999 0 $ 30,000 0 50,000* 0
President/CEO/
Director
Michael A. Strahl 1999 0 0 0 5,000* 0
Secretary/Director
Susan F. Turner 1999 0 0 0 5,000* 0
Treasurer/CFO/
Director
</TABLE>
*The board also issued Stock Options to the officers and directors of the
Company. These options have been execercised and the above listed options
reflect those shares.
19
<PAGE>
Employment and Change of Control Contracts
The Company does not currently have any employment agreements with its
employees or key personnel.
FINANCIAL STATEMENTS
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Financial Statements
With
Independent Auditor's Report
Prepared by
HAWKINS ACCOUNTING
CERTIFIED PUBLIC ACCOUNTANT
SALINAS, CALIFORNIA
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Index to Financial Statements
Page
----
Independent Auditor's Report 2
Balance Sheet 3
Statement of Operations, From date of
Inception to June 30, 1999 4
Statement of Shareholder's Equity 5
Statement of Cash Flows, From date of
Inception to June 30, 1999 6
Notes to Financial Statements 7
<PAGE>
HAWKINS ACCOUNTING
CERTIFIED PUBLICE ACCOUNTANT
341 MAIN STREET
SALINAS CA 93901
(831) 758-1694 FAX (831) 758-1699
To the Board of Directors and Shareholders
Trading Solutions.Com, Incorporated
Monterey, California
Independent Auditor's Report
I have audited the balance sheet of Trading Solutions.Com, Incorporated (a
development stage company) as of June 30, 1999 and the related statements of
operations, stockholders' equity and cash flows from the date of inception to
June 30, 1999. These financial statements are the responsibility of the
Company's management. My responsibility is to express an opinion on these
financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining on a test basis, evidence supporting
the amounts and assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. I believe that my audit provides reasonable basis for my
opinion.
In my opinion, the financial statements referred to in the first paragraph
present fairly, in all material respects, the financial position of Trading
Solutions.Com, Incorporated, as of June 30, 1999 and the results of operations
and its cash flows and the cumulative results of operations and cumulative cash
flows for the period from date of inception to June 30, 1999 in conformity with
generally accepted accounting principles.
The accumulated deficit during the development stage for the period from date of
inception to June 30, 1999 is $32,290.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note 7 to the financial
statements, the Company has incurred net losses from operations and has received
no revenue, which raises substantial doubt about its ability to continue as a
going concern. The financial statements do not include any adjustment that might
result from the outcome of this uncertainty.
July 21, 1999
/s/ Hawkins Accounting
----------------------
Hawking Accounting
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
BALANCE SHEET
June 30, 1999
<TABLE>
<CAPTION>
<S> <C>
ASSETS
Current assets
Cash in bank $ 17,381
Prepaid rent 677
Total current assets 18,058
Furniture and equipment
Equipment 2,206
Furniture 600
2,806
Accumulated depreciation (44)
2,762
Total assets $ 20,820
LIABILITIES AND STOCKHOLDERS EQUITY
Current liabilities
Accounts payable $ 5,770
State corporate tax liability 800
Total current liabilities 6,570
Total liabilities 6,570
Stockholders' equity
Common stock, 20,000,000 shares authorized at a
par value of .0 1. 2,627,000 outstanding 26,270
Paid in capital 20,270
Deficit incurred during development stage (32,290)
Total stockholder's equity 14,250
Total liabilities and
stockholder's equity $ 20,820
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
STATEMENT OF OPERATIONS
From date of inception to June 30, 1999
<TABLE>
<CAPTION>
Deficit
Accumulated
During
Development
Stage
<S> <C> <C>
Expenses
Accounting fees 3,000 $ 3,000
Bank charges 60 60
Consulting fees 9,150 9,150
Depreciation 44 44
Management fees 5,000 5,000
Miscellaneous 554 554
Office supplies 833 833
Postage 66 66
Promotions 271 271
Legal fees 10,100 10,100
Organizational costs 896 896
Rent 600 600
Telephone 268 268
Travel 634 634
--- ---
Loss from olierations prior to
other expenses and taxes (31,476) (31,476)
Other (expenses)
Interest (14) (14)
---- ----
Loss prior to income taxes (31,490) (31,490)
Income taxes
State corporate tax 800 800
--- ---
Net loss $ (32,290) $ (32,290)
-------- ----------
-------- ----------
Loss per common
share $ (0.01) $ ($0.01)
------- ----------
------- ----------
Weighted average of
shares outstanding 21,587,302 2,587,302
---------- ---------
---------- ---------
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
STATEMENT OF STOCKHOLDER'S EQUITY
June 30,1999
<TABLE>
<CAPTION>
Deficit
Accumulated
Paid During
Common Stock In Development
Shares Amount Capital Stage Total
<S> <C> <C> <C> <C> <C>
Founders stock 2,490,000 $ 24,900 (22,410) $ 2,490
Options 60,000 600 4,950 5,550
May 18,1999 14,000 140 6,860 7,000
May 21, 1999 2,000 20 980 1,000
May 24,1999 3,000 30 1,470 1,500
May 27,1999 2,000 20 980 1,000
June 2, 1999 10,000 100 4,900 5,000
June 3, 1999 2,000 20 980 1,000
June 4, 1999 4,000 40 1,960 2,000
June 7, 1999 2,000 20 980 1,000
June 13, 1999 2,000 20 980 1,000
June 16, 1999 3,000 30 1,470 1,500
June 17, 1999 10,000 100 4,900 5,000
June 22, 1999 2,000 20 980 1,000
June 25, 1999 1,000 10 490 500
June 27, 1999 6,000 60 2,940 3,000
June 29, 1999 12,000 120 5,880 6,000
June 30, 1999 2,000 20 980 1,000
(32,290) (32,290)
Total 2,627,000 $ 26,270 $ 20,270 $ (32,290) $ 14,250
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
STATEMENT OF CASH FLOWS-INDIRECT METHOD
From date of inception to June 30, 1999
<TABLE>
<CAPTION>
Deficit
Accumulated
During
Development
Stage
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ (32,290) $ (32,290)
Adjustment to reconcile net income to net cash
provided by operating activities
Depreciation 44 44
Increase in prepaid rent (678) -678
Increase in accounts payable 5,770 5770
Increase in taxes payable 800 800
NET CASH PROVIDED BY OPERATING ACTIVITIES (26,354) (26,354)
INVESTING ACTIVITIES
Purchase of furniture and equipment 2,806 2,806
NET CASH USED IN INVESTING ACTIVITIES 2,806 2,806
FINANCING ACTIVITIES
Sale of common stock 46,540 46,540
Short term borrowing 3,000 3,000
Payment of short term borrowing (3,000) (3,000)
NET CASH REALIZED FROM FINANCING ACTIVITIES 46,540 46,540
INCREASE IN CASH AND CASH EQUIVALENTS 17,380 17,380
Cash and cash equivalents at the beginning of the year 0 0
CASH AND CASH EQUIVALENTS $ 17,380 17,380
Supplemental disclosure of financiang activities
Interest paid during the period from date of
inception to June 30, 1999 $ 14 $ 14
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
June 30, 1999
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of the business
- ----------------------
Trading Solutions.Com, Inc (the "Company) is designed to provide education
for people interested in on line investing. The Company also intends to
establish a corporate trading account and manage money. The Company further
intends to establish or acquire an ecommerce business to link with the trading
school.
Development Stage Company
- ---------------------------
The Company is a development stage company, as developed in the Financial
Accounting Standards Board No. 7. The Company is devoting substantially all of
its present efforts in securing and establishing a new business, and although
planned operations have commenced, no revenues have been realized.
Pervasiveness of estimates
- --------------------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets, liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from these estimates.
Cash and cash eguivalents
- -------------------------
For financial statement presentation purposes, the Company considers all
short term investments with a maturity date of three months or less to be cash
equivalents.
Property and eguipment
- ----------------------
Property and equipment are recorded at cost. Maintenance and repairs are
expensed as incurred; major renewals and betterments are capitalized. When items
of property or equipment are sold or retired, the related costs and accumulated
depreciation are removed from the accounts and any gain or loss is included in
income.
Depreciation is provided using the straight-line method, over the useful
lives of the assets.
Income taxes
- ------------
Income taxes are provided for the tax effects of transactions reported in
the financial statements and consist of taxes currently due plus deferred taxes
related primarily to differences between the recorded book basis and the tax
basis of assets and liabilities for financial and income tax reporting. The
deferred tax assets and liabilities represent the future tax return consequences
of those differences, which will either be taxable or deductible when the assets
and liabilities are
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
June 30, 1999
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (con't)
Income taxes (con't)
- --------------------
recovered or settled. Deferred taxes are also recognized for operating losses
that are available to offset future taxable income.
Stock options
- -------------
The board of directors for the Company voted at its organizational meeting
to grant certain people and organizations the opportunity to purchase shares of
the Company's common stock at $. 10. These options are non-compensatory and are
recorded when exercised.
NOTE 2: BACKGROUND
The Company was incorporated under the laws of the State of Nevada on May
14,1999. The principal activities of the Company, from the beginning of the
development stage, have been organizational matters and the sale of stock.
NOTE 3: EQUIPMENT AND FURNITURE
The following is a summary of fixed asset classifications, accumulated
depreciation and depreciable lives for the Company at June 30, 1999.
<TABLE>
<CAPTION>
Useful life
Years Amount
<S> <C> <C>
Computer equipment 5 $2,206
Office ftu-niture 10 600
Total 2,806
Accumulated depreciation (44)
Net equipment and furniture $2,762
</TABLE>
Depreciation expense for the period from date of inception to June 30, 1999 was
$ 44.
NOTE 4: COMMON STOCK
Founders stock
- --------------
At incorporation the Company issued stock to the founders of the
corporation. These shares totaled 2,490,000 shares and were issued for
consideration of $.001 per share.
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
June 30, 1999
NOTE 4: COMMON STOCK (con't)
Stock options
- -------------
At the organizational meeting of the board of directors it was voted on to
issue stock options of the Company's common stock to certain officers of the
corporation, a key employee of a non affiliated company and the non affiliated
company. These options are to be exercised at $.10 a share and have an
expiration date of December 31, 2002. These options are callable at $.02 per
share by the Company with a 30 day notice. A total of 85,000 shares were voted
on for the options of which 60,000 shares of the options were exercised at June
30, 1999.
Public stock offering
- ---------------------
During the period ended June 30, 1999 the Company sold solely to accredited
and/or sophisticated investors its common stock. Each share had a par value of
$.01 a share and was offered to the investors at $.50 a share. The stock was
sold during various times during the period from date of inception to June 30,
1999 to 22 different investors buying a total of 77,000 shares of common stock.
Total proceeds, from the offering, as of the period ended June 30, 1999 were
$38,500.
NOTE 5: INCOME TAXES
The benefit for income taxes from operations consisted of the following
components: current tax benefit of $4,843 resulting from a net loss before
income taxes, and a deferred tax expense of $4,843 resulting from a valuation
allowance recorded against the deferred tax asset resulting from net operating
losses. Net operating loss carryforward will expire in 2014.
The valuation allowance will be evaluated at the end of each year,
considering positive and negative evidence about whether the asset will be
realized. At that time, the allowance will either be increased or reduced;
reduction would result in the complete elimination of the allowance if positive
evidence indicates that the value of the deferred tax asset is no longer
required.
NOTE 6: RELATED PARTY TRANSACTIONS
The Company entered into an agreement with one of its shareholders to
provide assistance to the Company in the formation of its corporate structure
and to use their contacts in assisting with the development of a public market
for the Company's common stock. The agreement calls for the shareholder to be
paid a total of $22,000 of which $5,000 was paid for
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
June 30, 1999
NOTE 6: RELATED PARTY TRANSACTIONS (con't)
the period ended June 30, 1999. The Company is to further provide support
services such as office space and telephone services for which the Company will
be billed separately. Total cash paid for these additional services as of June
30, 1999 was $1,465.
The Company also entered into an agreement with another shareholder to
provide consulting services to the Company. This agreement totals $30,000 of
which $6,000 was paid as of June 30, 1999.
There is an agreement with one of the founders to provide support services
to the Company. This agreement has a maximum of $6,000. The total amount paid as
of June 30, 1999 was $3,050.
NOTE 7: GOING CONCERN
From the date of inception to June 30, 1999, the Company has yet to
commence receiving revenue and has net losses from operating activities which
raise substantial doubt about its ability to continue as a going concern.
Management will work to establish a local market niche for each one of its
trading schools by advertising in local newspapers and radio. This is intended
to create public awareness of the Company's name and its services.
Management also intends to affiliate with professional traders to teach
online classes and seminars in real-time broadcasting. The Company also intends
to continually invest in its web site infrastructure as needed for upgrades,
incorporation of new features and keeping up with the changing internet
technology. The Company will establish an on line store that will offer
literature such as books, newspapers and newsletters that will target online
investors.
In order to attract and retain quality instructors the Company plans to
grant each participating instructor the opportunity to be promoted on an
exclusive basis by the Company's web site.
The Company's ability to continue as a going concern is dependent upon a
successful public offering and ultimately achieving profitable operations.
<PAGE>
TRADING SOLUTIONS.COM, INCORPORATED
(A Development Stage Company)
Notes to Financial Statements
June 30, 1999
NOTE 7: GOING CONCERN (con't)
There is no assurance that the Company will be successful in its efforts to
raise additional proceeds or achieve profitable operations. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
<PAGE>
EXPERTS AND LEGAL MATTERS
The financial statements of Trading Solutions.com, Inc. for the period from
February 1, 1999 to June 30, 1999 included in this prospectus and registration
statement have been audited by Richard Hawkins, CPA, an independent auditor, as
stated in his report and have been so included in reliance upon the report of
such CPA given upon his authority as expert in accounting and auditing.
Legal matters will be passed upon for the Company by Gary R. Blume, Esq.,
Blume Law Firm , P.C., 11801 North Tatum Boulevard, Suite 108, Phoenix, Arizona
85028.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
The Company has had no changes in or disagreements with its accountants
from inception to the present time.
PART II
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The officers and directors of the Company are indemnified as provided under
the Nevada Law and as detailed in the Articles of Incorporation. No additional
indemnification has been authorized.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The expenses of the Registration Statement are as follows:
<TABLE>
<CAPTION>
<S> <C>
Transfer Agent: $ 1000
Legal and Accounting: $ 10,500
TOTAL $ 11,500
</TABLE>
32
<PAGE>
RECENT SALES OF UNREGISTERED SECURITIES
Upon incorporation, Natalie Shahvaran was issued 1,200,000 shares of common
stock, Susan F. Turner was issued 15,000 shares of common stock, Michael A.
Strahl was issued 15,000 shares of common stock, Internet Finance.com, Inc. was
issued 1,200,000 shares of common stock, Blume Law Firm, P.C. was issued 10,000
shares of common stock, Melissa DeAnzo was issued 5,000 shares of common stock,
Monterey Ventures was issued 50,000 shares of common stock. These were issuances
of securities from the Company not involving a public offering and were exempt
from the registration provisions of the Securities Act of 1933, as amended,
pursuant to section 4(2). The securities bear a restrictive legend permitting
the transfer thereof only upon registration of the securities or an exemption
under the Securities Act.
Under the terms of a private placement done by the Company in reliance on
Regulation D, Rule 504, 120,000 shares of common stock of the Company was sold
to the investors listed below. The offering was closed on August 18, 1999 and
resulted in receipt by the Company of $60,000. All shares were sold to a total
on nine accredited and twenty eight unaccredited investors. The proceeds from
this offering were used for working capital, legal, accounting and consulting
fees.
In May 1999, the Company also voted to grant options to its directors,
officers, key personnel, and to Internet Finance.com, Inc., Monterey Ventures,
Inc., and Melissa DeAnzo. These options are exercisable at $.10 per share and
consist of a total of 85,000 options with an expiration date of 12/31/2002. The
options are not compensatory, nor do they represent services rendered. The
options were issued in reliance upon Section 4(2) of the Securities Act of 1993.
To date, all options have been exercised.
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Exhibit Description
3. Articles of Incorporation and Bylaws*
3.1 Articles of Incorporation and Amendments*
3.2 Bylaws*
10. Material Contracts*
23. Consent of Independent Auditor
27. Financial Data Schedule
99. Investment Banking Agreement
99.1 Investment Letter
99.2 Consulting Agreement
99.3 Consulting Agreement
* Indicates previously submitted exhibit
UNDERTAKINGS
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 Act and is,
therefore, unenforceable. If 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 Act and will be governed by the final adjudication of
such issue.
33
<PAGE>
The issuer will file, during any period in which it offers or sells
securities, a post-effective amendment to this registration statement to include
any prospectus required by section 10(a)(3) of the Securities Act, to reflect in
the prospectus any facts or events which represent a fundamental change in the
information in the registration statement and to include any additional or
changed material information on the plan of distribution.
For determining liability under the Securities Act, the issuer will treat
each post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial bona
fide offering.
The issuer will file a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the offering.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Naperville, State of
Illinois.
TRADING SOLUTIONS.COM, INC.
/s/ Natalie Shahvaran
---------------------
Natalie Shahvaran, Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Gary R. Blume, Esq. as true and lawful
attorneys-in-fact with full power of substitution and resubstitution, for him
and in his name, place and stead, in any and all capacities, to sign any or 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 attorneys-in-fact 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 said attorneys-in-fact or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereon.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
/s/ Natalie Shahvaran October 5, 1999
- --------------------- ---------------
Natalie Shahvaran Chief Executive Officer Date
/s/ Susan Turner October 5, 1999
- ---------------- ---------------
Susan Turner Chief Financial Officer Date
/s/ Michael Strahl October 5, 1999
- ------------------ ---------------
Michael A. Strahl Secretary Date
34
<PAGE>
HAWKINS ACCOUNTING
CERTIFIED PUBLIC ACCOUNTANT 341 MAIN STREET SALINAS, CA 93901
(831) 759-1694 FAX (831) 759-1699
August 16, 1999
CONSENT OF INDEPENDENT AUDITOR
As the independent auditor for Trading Solutions.Com, Inc., I hereby
consent to the incorporation by reference in this Form SB-2 Statement and any
amendments thereto of my report, relating to the financial statements and
financial statement schedules of Trading Solutions.Com, Inc. for the period
ended June 30, 1999 included on Form SB-2 and amendments. Reports are dated June
30, 1999.
I further consent to the incorporation of my review report and financial
statements by reference in the Form 10-QSB and amendments thereto. These
statements cover the period for June 30, 1999. Report date of June 30, 1999.
/s/ Hawkins Accounting
----------------------
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 17,381
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 17,381
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 20,820
<CURRENT-LIABILITIES> 5,770
<BONDS> 0
0
0
<COMMON> 26,270
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 20,820
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> (31,476)
<LOSS-PROVISION> (31,490)
<INTEREST-EXPENSE> (14)
<INCOME-PRETAX> 0
<INCOME-TAX> 800
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (32,290)
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
INVESTMENT BANKING AGREEMENT
This Agreement is made on the 13th day of May 1999, by and between Internet
Finance.com, Inc. (hereafter referred to as IF.COM) who's offices are located at
380 Foam Street, Suite 210, Monterey, California 93940 and Trading
Solutions.com, Inc. (hereafter referred to as TS.COM) who's address is 380 Foam
Street, Suite 210, Monterey, California 93940.
IF.COM's management and staff have a background in investment banking, corporate
finance, bridge -loans, sales and marketing and is willing to provide services
to TS.COM based on this background. TS.COM desires to have services provided by
IF.COM.
Therefore, the parties agree as follows:
1. DESCRIPTION OF SERVICES. Beginning on the date of this agreement IF.COM will
provide the following services, (collectively the "Services"):
Assist in the formation of the proposed corporation, including assistance
in all state and federal filings as well as all state and federal
filings that might be necessary for the proposed Private Placement
Offering.
Assist in the formulation and production of a business plan which shall
include the development of pro forma statements, break even analysis,
spreadsheets, graphs, charts and cost projections.
Produce an investor presentation package to include tools that range from
presentation folders to the most sophisticated audiovisual and
interactive computer technologies.
Prepare a Private Placement Offering Memorandum (in accordance with federal
exemption from registration in reliance upon the exemption from
registration provided by Section 4(2) of "The Act" and Regulation D
promulgated pursuant to Section 3(b) of "The Act") allowing the
company to raise additional capital (as outlined in Schedule A).
Act in the capacity as TS.COM's "Investment Banker" and assisting in the
placement of the companies securities to raise the money needed for
IF.COM to follow-Ahrough with their business plan.
Give professional advice and assistance in the areas of corporate
structure, corporate finance, management structure, time line
projections, future funding and marketing.
<PAGE>
2. OTHER SERVICES. TS.COM has agreed for IF.COM to buy 1,200,000 shares of
founders stock at $.01 per share. TS.COM has also agreed to repay the bridge
loan within the 6 month time frame of $3,000 + interest due. TS.COM has agreed
to allow IF.COM to name one board member at any time that it may be needed.
TS.COM has agreed to allow IF.COM to receive any options that may be issued to
them.
3. PERFORMANCE OF SERVICES. The manner in which the services are to be performed
and the specific hours to be worked by IF.COM shall be determined by IF.COM.
TS.COM will rely on IFCOM to work as many hours as reasonably necessary to
fulfill IF.COM's obligations under this Agreement.
4. PAYMENT. TS.COM will pay a fee to IFCOM in the amount of $22,000.00
S. FINDERS FEE. Trading Solutions. com, Inc. will pay to Robert A. Strahl a
finders fee of $1,000.00 per month for the first $499,000.00 raised. He will
then be paid $4,000.00 per month, which will be accumulative from the beginning
after raising $500,000.00 or more.
6. EXPENSES. IFCOM shall be entitled to reimbursement from TS.COM for all
reasonable "out-of-pocket" expenses including, but not limited to: travel,
meals, postage, copying and phone.
6. TERM/TERMINATION. This Agreement shall automatically terminate upon
consultant's completion of the services required by this Agreement.
7. RELATIONSHIP OF PARTIES. It is understood by both parties that IF.COM is an
independent contractor with respect to TS.COM and not an employee of TS.COM.
TS.COM will not provide fringe benefits for the benefit of IF.COM This includes
health insurance benefits, paid vacation or any other employee benefit.
S. CONFIDENTIALITY. IFCOM recognizes that has and will have the following
information and or trade secrets including, but not limited to: inventions,
apparatus, future plans, business affairs, process information, customer lists,
product design information and other proprietary information (collectively,'
"Information") which are valuable, special and unique assets of IFCOM agrees
that IF.COM will not at any time or in any manner, either directly or
indirectly, use any information for IFCOM's own benefit or will IRCOM divulge,
disclose or communicate in any manner, any information to any third party
without the prior written consent of TS.COM. IF.COM win protect the Information
and treat it as strictly confidential. A violation of this paragraph shall be a
material violation of this Agreement.
<PAGE>
9. RETURN OF RECORDS. Upon termination of this Agreement, IF.COM shall return
all records, notes, data, memorandum, models and equipment of any nature that
are in IF.COM's possession or under IF.COM's control that are property or relate
to's business.
10. NOTICES. All notices required or permitted under this Agreement shall be in
writing and shall be deemed delivered when delivered in person or deposited in
the United States mail, postage prepaid, and addressed as follows:
Internet Finance.com, Inc.
380 Foam Street, Suite 2 10
Monterey, CA 93940
Trading Solutions.com, Inc.
380 Foam Street, Suite 2 10
Monterey, CA 93940
Such address may be changed from time to time by either party by providing
written notice to the other in the manner set forth above.
11. ENTIRE AGREEMENT. This Agreement contains the entire agreement of both
parties and there are no other promises or conditions in any other agreement
whether oral or written. This Agreement supersedes any prior written or oral
agreements made between the parties.
12. AMENDMENT. This Agreement may be modified or amended if the amendment is
made in writing and is signed by both parties.
13. SEVERABILITY. If any provision of this Agreement shall be held to be invalid
or unenforceable for any reason, the remaining provisions shall continue to be
valid and enforceable. If a court finds that any provision of this Agreement is
invalid or unenforceable but that by limiting such provision it would become
valid and enforceable, then such provision shall be deemed to be written,
construed and enforced as so limited.
14. WAIVER OF CONTRACTUAL RIGHT. The failure of either party to enforce any
provision of this Agreement shall not be construed as a waiver or limitation of
that party's right to subsequently enforce and compel strict compliance with
every provision of this Agreement.
15. APPLICABLE LAW. This Agreement shall be governed by the laws of the State of
California.
TRADING SOLUTIONS.COM, INC.
By:/s/ Natalie Shahvaran
- ------------------------
Natalie Shahvaran, President
INTERNET FINANCE.COM, INC.
By:/s/ Robert A. Strahl
- -----------------------
Robert A. Strahl, President
INVESTMENTLETTER
AND
NMMORANDUM OF SUBSRIPTION/PURCHASE AGREEMENT
May 15, 1999
Trading Solutions.com, Inc.
380 Foam Street, Suite 210
Monterey, Californla 93940
In connection with the acquisition by the undersigned ______ shares of
common stock at $.50 per share of (the "Company"), the undersigned wishes to
advise you of his understanding of, agreement with and/or representation of, the
following:
These securities are not being registered under the Securities Act of 1933,
as amended (the "Act"), on the ground that this sale is exempt from registration
under Section 4(l) or Section 4(2) of the Act and the Rules and Regulations
promulgated thereunder as not involving any public offering. The Company's
reliance on such exemption is predicated in part on the representation of the
undersigned that he, she or it is acquiring such securities for investment for
her own account, with no present intention of dividing her participation with
others or reselling or otherwise distributing the same. These securities which
the undersigned is acquiring are "restricted securities" as that term is defined
in Rule 144 of the General Rules and Regulations under the Act. The undersigned
acknowledges that he, she or it understands that the securities covered hereby
are unregistered and must be held indefinitely, unless they are subsequently
registered under the Act or an exemption from such registration is available.
The undersigned agrees that any and all certificates, which may be issued
representing the securities acquired hereunder, shall contain substantially the
following legend, whidh the undersigned has read and understands:
The shares represented by this certificate have not been registered under
the Securities Act of 1933 (the "Act"), and are "restricted securities" as the
term is defined in Rule 144 under the Act. The share may not be offered for
sale, sold or otherwise transferred except, pursuant to an effective
registration statement under the Act, or pursuant to an exemption from
registration under the Act, the availability of which is to be established to
the satisfaction of the Company.
<PAGE>
May 15,1999
Page Two
The undersigned understands that the above legend on the certificates
would limit their value, including their value as collateral:
The undersigned further acknowledges that he, she or it understands that,
if the securities have been held for a period of at least two years and if Rule
144 adopted under the Act is applicable (there being no representation by the
Company that this rule will be applicable), then he, she or it may make only
routine sales of the securities in limited amounts in a specified manner in
accordance with the terms and conditions of the Rule. The undersigned further
acknowledges that he, she or it understands that, if Rule 144 is applicable (no
assurance of which can be made), he, she or it may sell the securities without
quantity limitation in sales not involving a market maker or through brokerage
transactions only if he, she or it has held the securities for at least three
years. In case the Rule is not applicable, any sales made by the undersigned may
be made only pursuant to other available exemption from registration under the
Act, or an effective registration statement.
The undersigned further acknowledges that he, she or it is aware that
only.the Company can file a registration statement or an offering statement
pursuant to Regulation A under the Act and that the Company has no obligation to
do so or to take steps necessary to make Rule 144 available to them. The
undersigned also has been advised and acknowledges that he, she or it
understands that, in the event Rule 144 is not available, the circumstances
under which he, she or it can sell the securities, absent registration or
compliance with Regulation A, are extremely limited.
The undersigned further acknowl6dges and represents to the Company that he,
she or it is purchasing the securities for her own account and not as a trustee
or nominee for any other person or persons, and that the funds or consideration
invested are her own. The undersigned further acknowledges aRd represents that
there are no existing legal restrictions applicable to her which would preclude
her acquisition of the securities for investment purposes, as described
hereinabove. The undersigned further represents that he, she or it has no
present plans to enter into any contract, undertaking, agreement or arrangement
for resale, distribution, subdivision or fractionalization of the securities
purchased hereby.
The undersigned further acknowledges that he, she or it understands that an
investment in the Company is extremely speculative and subject to a high degree
of risk.
<PAGE>
May 15,1999
Page Three
In this connection, the undersigned understands that he, she or it may lose her
entire investment in the Company.
The undersigned further acknowledges and represents to the Company that he,
she or it is able to bear the economic risk of losing her entire investment. The
undersigned ftirther acknowledges and warrants that her overall commitment to
investments which are not readily marketable is not disproportionate to her net
worth and her investment in the securities will not cause such overall
commitment to become excessive. The undersigned further represents that he, she
or it has adequate means of providing for her current needs and personal
contingencies and that he, she or it has no need for liquidity in connection
with her investment in the securities.
The undersigned further acknowledges that he, she or it fully understands
and agrees that the price of the Company's securities acquired by her was
arbitrarily determined without regard to any value of the securities. The
undersigned understands, additionally, that the price of the securities bears no
relation to the value of the assets or net worth of the Company or any other
criteria of value. The undersigned is aware that no independent evaluation has
been made with respect to the value of the securities. The undersigned further
understands and agrees that share of the preferred stock of the Company have
been or may in the future be issued to certain other persons for a cons.*
deration which may be less than the price paid by them for the securities.
The undersigned further acknowledge and represent to the Company that he,
she or it is knowledgeable and ex erienced in venture capital investments in
general and, in p particular, with respect to investments similar in nature to
an investment in the Company. The frequency of the undersigned's prior
investments in stocks (including restricted stocks), in general, and in
development-stage companies, in particular, and other investments, of whatever
kind, is as follows (check one in each column):
Restricted Development-Stage
Stocks Stocks Companies Other
------ ------ --------- -----
Frequently ______ __________ ________________ _____
Occasionally ______ __________ ________________ _____
Never ______ __________ ________________ _____
The undersigned further acknowledges that he, she or it is capable of
evaluating the merits -and risks of the Company.
<PAGE>
May 15, 1999
Page Four
The undersigned further acknowledges that he, she or it has such knowledge
and experience in financial and business matters that he, she or it is capable
of evaluating the merits and risks of an investment in the Company; that he, she
or it has been advised by the Company to consult with counsel regarding this
investment; and that he, she or it has relied upon the advice of such counsel,
accountants or other consultants as he, she or it deems necessary with regard to
tax aspects, risks and other considerations involved in the investment. The
undersigned's educational and occupational background which renders her capable
of evaluating the merits and risks of this investment is as follows:
_______________________________________________________________
_______________________________________________________________
_______________________________________________________________
The undersigned has made, or caused to be made, such investigation of the
Company, its management and its operations as he, she or it considers necessary
and appropriate to enable her to make an informed decision regarding her
investment.
Prior to making his, her or its investment, the undersigned was presented
with and acted upon the opportunity to ask questions of and receive answers from
the Company and its management relating to the Company and to obtain any
additional information necessary to verify the accuracy of the information made
available to them.
Prior to making his, her or its investment, the undersigned made
arrangements to conduct such inspection as he, she or it deems necessary of the
books, records, contracts, instruments and other data relating to the Company.
Before acquiring these securities, the undersigned was presented with and
understood the Company's business plan,'including, among other things, the
nature of the Company, fmancial reports and management.
The undersigned agrees that, upon the delivery of certificates for his, her
or its shares, the undersigned will execute and deliver to and for the benefit
of the Company any instruments the Company may require to evidence that the
purchase of her shares is for investment purposes only.
<PAGE>
May 15,1999
Page Five
On the date the undersigned acquired the securities, he, she or it had a
net worth (exclusive of home, furnishings and personal automobile) of:
(___) Less than $500,000
(___) $500,000 - $1,000,000
(___) $1,000,000 - $3,000,000
(___) $3,0,00,000 - $5,000,000
(___) More than $5,000,000
Liquid assets constituted the following percentage of the undersigned's net
worth on the date of acquisition of the securities:
(___) Less than 1%
(___) 1%-10%
(___) 10%-20%
(___) 20%-50%
(___) More than 50%
The undersigned's approximate net taxable income (after regular deductions)
in each of the two most recent calendar years was:
(___) Less than $ 100,000
(___) $100,000 - $200,000
(___) $200,000 - $500,000
(___) $500,000 - $1,000,000
(___) More than $1,000,000
Based upon the foregoing, the undersigned hereby acknowledges and
understands that high risk and speculative nature of t1fe share of preferred
stock of the Company which he, s4e or it is acquiring and the nature of the
management, financial condition and all other pertinent factors regarding the
Company and this investment. The undersigned further represents and warrants
that he, she or it is aware that the Company may be considered to be a
"development stage" company and he, she or it has fully satisfied herself with
respect to the nature of this investment. The undersigned further warrants and
represents that he, she or it has received no assurances of any kind relative
to, nor have there been any representations made by the Company or any of its
principals or affiliates regarding any potential appreciation in value of the
securities being acquired by her. The undersigned hereby represents and warrants
that he, she or it has sufficient knowledge and experience in business and
financial matters to evaluate the merits and risks of an investment of this
type. The undersigned further represents and acknowledges
<PAGE>
May 15,1999
Page Six
that he, she or it has made other investments in speculative businesses and is
generally familiar with "restricted" securities and he, she or it is otherwise
knowledgeable with respect to the Company and its proposed operations. Based
upon the foregoing understandings, the undersigned hereby reaff=s his, her or
its acquisition of the securities described in this Investment Letter and
Memorandum of Subscription/Purchase Agreement.
The foregoihg correctly expresses the intent, understanding and
acknowledgements of the undersigned.
________________________________
Signature
Current Address: Current Telephone Number:
_____________________ ____________________________
_____________________
Taxpayer Identification Number: Current Business:
_____________________ ____________________________
____________________________ ____________________________
Name of person connected with Relationship, if any, with the
______________, with whom above mentioned company
conferred concerning this representative:
investment:
____________________________
Length of relationship, if any,
with the above mentioned
company representative
/s/ Natalie Shahvaran
- ---------------------
ACCEPTING OFFICER OF COMPANY
CONSULTING AGREEMENT
This Agreement is made on the 15th day of May 1999, by and between Trading
Solutions.com, Inc. (hereafter referred to as TS.COM) who's offices are located
at 200 Camino Aguajita, Suite 200, Monterey, California 93940 and NataHe
Shahvaran (hereafter refe rred to aa NS) who's address is PO BOX 2285 1, Carmel,
CA 93922.
Therefore, the parties agree as follows:
1. DESCRIPTION OF SERVICES. Beginning on the date of this agreement Natalie
Shahvaran will provide the following services, (collectively the "Services");
Assist in the formation of the proposed corporation, including assistance
in all state and federal filings as well as all state and federal filings
that might be iiecessaxy for the proposed Private Placement Offering.
Assist in the formulation and production of a business plan which shall
include the development of pro forma stateLiients, break even analysis,
spreadsheets, graphs, charts and co,,5t projections.
Produce an investor presentation package to iticlude tools that range from
presentation folders to the most sophisticated audiovisual and interactive
computer technologies.
Prepare a Private Placement Offering Memorandum (in accordance with federal
exemption from registration in reliance upon the exemption from
registration provided by Section 4(2) of "The Act" and Regulation D
promulgated pursuant to Section 3(b) of "The Act") allowing the company to
raise additional capital (as outlined in Schedule,A).
Give professional advice and assistance in the areas of corporate
structure, corporate finance, management structure, Lime line projections,
future funding and marketing.
3. PERFORMANCE OF SERVICES. The manrier in which the services are to be
performed and the specific hours to be worked by Natalle Shahvaran shall be
determined by Natalie Shahvaran. TS.COM will rely on Natalie Shahvaran to work
as many hours as reasonably necessary to fulfill T&COM's obligations under this
Agreement.
4. PAYMENT. TS.COM will pay a fee to Natalie Shahvaran in the amount of/or up to
$30,000.00
<PAGE>
5. EXPENSES. Natalie Shahvaran shall be enlitled to reimbursement from TS,COM
for all reasonable "out-of-pocket" expenses including, but not limited to:
travel, meals, postage, copying and phone,
6. TERM/TERMINATION. This Agreement shall automatically terminate upon
consultant's completion of the services required by this Agreement.
7. RELATIONSHLP OF PARTIES. It is understood by both parties that Natalie
Shahvaran is an independent contractor with respect to TS.COM and not an
employee of TS.COM. TS-COM will not provide fringe benefits for the benefit of
Natalie Shahvaran This includes health insurance benefits, paid vacation or any
other employee benefit.
S. CONFIDENTIALITY. Natalie Shahvaran agrees that she will not at any tirne or
in any manner, either directly or indirectJy, use any information for her own
benefit or will she divulge, disclose or communicate in any manner, any
information to any third party without the prior written consent of TS.COM.
Natalie Shahvaran will protect the Information and treat it as strictly
confidential. A violation of this paragraph shall be a material violation of
this Agreement.
9. RETURN OF RECORDS. Upon termination of this Agreement, Natalie Shahvaran
shall retain all records, notes, data, memorandum, models and equipment of any
nature that are in her possession or under her control that are propert3i or
relate to it's business.
10. NOTICES. All notices required or permitted under this Agreement shall be in
writing and shall be deemed delivered when delivered in person or deposited in
the United States mail, postage prepaid, and addressed as follows:
Trading Solutions.com, Inc.
200 Camino Aguajito,
Suite 200 Monterey, CA 93940
Natalie Shahvaran
PO BOX 22851
Carmel, CA 93922
Such address may be changed from time to time~ by either party by providing
written notice to the other in the matmer set forth above.
11. ENTIRE AGREEWNT. This Agreement contains the entire agreement of both
parties and there are no other promises or conditions in any other agreement
whether oral or written, This Agreement supersedes any prior written or oral
agreements made between the parties.
<PAGE>
12. AMENDMENT. This Agreement may be modified or amended if the amendment is
made in writing and is signed by both parties.
13. SEVERABILITY. If any provision of this Agreement shall be held to be invalid
or unenforceable for any reason, the remaining provisions shall continue to be
valid and enforceable. If a court finds that any provision of this Agreement is
invalid or unenfbrccable but that by limiting such provision it would become
valid and enforceable, then such provision ahall be deemed to be written,
construed and enforced as so limited.
14. WAIVER OF CONTRACTUAL RIGHT. The failure of either party to enforce any
provision of this Agreement shall not be construed as a waiver or limitation of
that partys right to subsequently enforce and compel strict compliance with
every provision of this Agreeramt.
15. APPLICABLE LAW. This Agreement shall be governed by the laws of the State of
California.
Natalie Shahvaran
By: /s/ Natalie Shahvaran
- -------------------------
Natalie Shahvaran
Trading Solutions.com, Inc.
By: /s/ Michael Strahl
- ----------------------
Michael Strahl, Secretary/Treasurer
CONSULTING AGREEMENT
TRADING SOLUTIONS.COM, INC. AND MELISSA DEANZO
This Agreement is made on the 15th day of May, 1999, by and between Trading
Solutions.com, Inc. located at 200 Camino Aguajito, SUite 200, Monterey, CA
93940 and Melissa DeAnzo located at 26 Anne Street, Salinas, CA 93901.
The two parties mentioned above agree to the following;
1. Description of Services. Beginning on the date ofthis Agreement, Melissa
DoAnzo will provide the following services:
Set up corporation in the State of Nevada.
Set up company bank account at First Natiowd Bank ol'Central
California in Monterey.
Be responsible for all payable and receivables for the company.
Assist in the organization of the accounting for Hawkins Accounting
who has been selected to do any financial and audit needs for the
conipany.
Assist with the shareholder list and other information needed.
Assist in handling the newsletter that will be sent to the
shareholder' s.
Assist in any other secretarial services needed for the company.
2. Other Services. Trading Solutions.com, Inc, has igreed for Melissa DeAnzo to
buy 5,000 shares of founder's stockat $.001 pershare, Trading Solutions,com,
Inc, has also agreed To allow Melissa DeAftZo to receive any oprioni that may be
issued to her at a minimal price.
3. Performance of Services. The manner in which the services are to be performed
and the specific hours to be worked by Melissa DeAnzo shall be determined by
her. Trading Solutions.com, Inc. will rely on her to work as many hours as
reasonably necessary to ftilfill Trading Solutions.com, Inc.'s obligation under
this Agreement.
4. Payment. Trading Solutions.com, Inc. will pay Melissa DeAnzo a fee of Six
Thousand Five Hundred Dollars ($6,500).
5. Expenses. Melissa DeAnzo shall be entitled to reimbursement from Trading
Solutions.com, Inc. for all reasonable "out-of-pocket" ex1mises including, but
not limited to: travel, meals, postage, copying and any phone calls.
6. Term/Termination. This Agreement shall automatically terminate upon the
completion of the services required by this Agreement. Received: 10/ 5/99 10:26;
<PAGE>
CONSULTING AGREEMENT
TRADING SOLUTIONS.COM, INC. AND MELISSA DEANZO
7. Relationship of Parties. It is understood by both parties that Melissa DeAnzo
is an independent contractor with respect to Trading Solutions.com, Inc. and not
an employee of Trading Solutions.com, Inc.
S. Return of Records. Upon termination of this Agreement, Melissa DeAnzo shall
return all records, notes, data and memorandums of any nature that are in her
possession or under her control that is property or relates to the business.
9. Entire Agreement. This Agreement contains this entire agreement of both
parties and there are no other promises or conditions in any other agreement
oral or written. This Agreement supersedes any prior written or oral agreements
made between both parties.
10. Amendment. This Agreement may be modified or amended if the amendment is
made in writing and is signed by both parties.
11. Applicable Law. This Agreement shall be governed by the laws of the State of
California.
TRADING SOLUTIONS.COM9 INC.
/s/ Natalie Shahvaran
- ---------------------
Natalie Shahvaran, President
CONSULTANT
/s/ Melissa DeAnzo
- ------------------
Melissa DeAnzo, Consultant
