AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 5, 2000
REGISTRATION NO. 333-____________
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
____________________
ADVANTAGE TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
NEVADA 93-1244440
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1324 S. Mary Avenue
Sunnyvale, California 94087
(Address of Principal Executive Offices, Including Zip Code)
Consulting Agreement
(Full Title of the Plan)
____________________
George J. Bentley
1324 S. Mary Avenue
Sunnyvale, California 94087
(408) 746-9960
(Name, Address, and Telephone Number of Agent for Service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Title of Securities Amount to be Proposed Maximum Proposed Maximum Amount of
to be Registered Registered Offering Price per Share Aggregate Offering Price Registration Fee
Common Stock,
par value $0.001 1,540,000 $ 0.15 (1) $231,000 $60.99
(1) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) based on the closing market price on
March 31, 2000.
</TABLE>
1
<PAGE>
EXPLANATORY NOTE
Advantage Technologies, Inc., ("ADVV") has prepared this Registration
Statement in accordance with the requirements of Form S-8 under the Securities
Act of 1933, as amended (the "1933 Act"), to register certain shares of common
stock, $.001 par value per share, issued to certain selling shareholders.
Under cover of this Form S-8 is a Reoffer Prospectus ADVV prepared in accordance
with Part I of Form S-3 under the 1933 Act. The Reoffer Prospectus may be
utilized for reofferings and resales of up to 1,540,000 shares of common stock
acquired by the selling shareholders.
2
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
ADVV will send or give the documents containing the information specified in
Part 1 of Form S-8 to employees or consultants as specified by Securities and
Exchange Commission Rule 428 (b) (1) under the Securities Act of 1933, as
amended (the "1933 Act"). ADVV does not need to file these documents with the
commission either as part of this Registration Statement or as prospectuses or
prospectus supplements under Rule 424 of the 1933 Act.
3
<PAGE>
REOFFER PROSPECTUS
ADVANTAGE TECHNOLOGIES, INC.
1324 S. MARY AVENUE
SUNNYVALE, CALIFORNIA 94087
(408) 746-9960
1,540,000 SHARES OF COMMON STOCK
The shares of common stock, $0.001 par value per share, of Advantage
Technologies, Inc. ("ADVV" or the "Company") offered hereby (the "Shares") will
be sold from time to time by the individuals listed under the Selling
Shareholders section of this document (the "Selling Shareholders"). The Selling
Shareholders acquired the Shares pursuant to a Consulting Agreement for
consulting services that the Selling Shareholders provided to ADVV.
The sales may occur in transactions on the NASD Over-The-Counter market at
prevailing market prices or in negotiated transactions. ADVV will not receive
proceeds from any of the sale the Shares. ADVV is paying for the expenses
incurred in registering the Shares.
The Shares are "restricted securities" under the Securities Act of 1933 (the
"1933 Act") before their sale under the Reoffer Prospectus. The Reoffer
Prospectus has been prepared for the purpose of registering the Shares under the
1933 Act to allow for future sales by the Selling Shareholders to the public
without restriction. To the knowledge of the Company, the Selling Shareholders
have no arrangement with any brokerage firm for the sale of the Shares. The
Selling Shareholders may be deemed to be an "underwriter" within the meaning of
the 1933 Act. Any commissions received by a broker or dealer in connection with
resales of the Shares may be deemed to be underwriting commissions or discounts
under the 1933 Act.
ADVV's common stock is currently traded on the NASD Over-the-Counter Bulletin
Board under the symbol "ADVV."
________________________
This investment involves a high degree of risk. Please see "Risk Factors"
beginning on page xx.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED WHETHER
THIS REOFFER PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
________________________
April 5, 2000
4
<PAGE>
TABLE OF CONTENTS
Where You Can Find More Information 5
Incorporated Documents 5
The Company 7
Risk Factors xx
Use of Proceeds xx
Selling Shareholders xx
Plan of Distribution xx
Legal Matters xx
Experts xx
________________________
You should only rely on the information incorporated by reference or provided in
this Reoffer Prospectus or any supplement. We have not authorized anyone else
to provide you with different information. The common stock is not being
offered in any state where the offer is not permitted. You should not assume
that the information in this Reoffer Prospectus or any supplement is accurate as
of any date other than the date on the front of this Reoffer Prospectus.
WHERE YOU CAN FIND MORE INFORMATION
ADVV is required to file annual, quarterly and special reports, proxy statements
and other information with the Securities and Exchange Commission (the "SEC") as
required by the Securities Exchange Act of 1934, as amended (the "1934 Act").
You may read and copy any reports, statements or other information we file at
the SEC's Public Reference Rooms at:
450 Fifth Street, N.W., Washington, D.C. 20549;
Seven World Trade Center, 13th Floor, New York, N.Y. 10048
Please call the SEC at 1-800-SEC-0330 for further information on the Public
Reference Rooms. Our filings are also available to the public from commercial
document retrieval services and the SEC website (http://www.sec.gov).
INCORPORATED DOCUMENTS
The SEC allows ADVV to "incorporate by reference" information into this Reoffer
Prospectus, which means that the Company can disclose important information to
you by referring you to another document filed separately with the SEC. The
information incorporated by reference is deemed to be part of this Reoffer
Prospectus, except for any information superseded by information in this Reoffer
Prospectus.
5
<PAGE>
ADVV's Report on Form 8-K, dated April 3, 2000 is incorporated herein by
reference. ADVV also incorporates herein by reference the Form 10-SB, as
amended, filed by Go Fathom Group, Inc., the Company's predecessor, originally
filed on November 17, 1999. In addition, all documents filed or subsequently
filed by the Company under Sections 13(a), 13(c), 14 and 15(d) of the 1934 Act,
before the termination of this offering, are incorporated by reference.
The Company will provide without charge to each person to whom a copy of this
Reoffer Prospectus is delivered, upon oral or written request, a copy of any or
all documents incorporated by reference into this Reoffer Prospectus (excluding
exhibits unless the exhibits are specifically incorporated by reference into the
information the Reoffer Prospectus incorporates). Requests should be directed to
the Chief Financial Offer at ADVV at ADVV's executive offices, located at 1324
S. Mary Avenue, Sunnyvale, California 94087.
ADVV's telephone number is (408) 746-9960.
6
<PAGE>
THE COMPANY
BUSINESS
This Reoffer Prospectus contains certain forward-looking statements within the
meaning of the federal securities laws. Actual results could differ materially
from those projected in the forward-looking statements due to a number of
factors, including those set forth under "Risk Factors" and elsewhere in this
Reoffer Prospectus.
HISTORY
Advantage Technologies, Inc. (the"Company") was originally organized as
a Nevada corporation on September 21, 1993 under the name Logistics Distribution
Systems International Group, Inc. Under the Company's management at that time,
of which our current management was not a part, the Company's original business
was to investigate for possible acquisition various business opportunities. The
current management of the Company is not aware of what business, if any, was
carried at that time. On November 8, 1995, the Company's name was changed to
Vortices, Inc. Under the then current management, the Company's business was the
development and marketing of flight simulators to the arcade game market.
On April 21, 1998, the Company merged with Simulator Systems, Inc., a
Nevada corporation, which was the surviving corporation of a prior merger on
April 15, 1997 between Simulator Systems, Inc. and Marksmanship Training
Centers, Inc., an Oregon corporation.
After the merger with Simulator Systems, Inc., the business of the
Company became the development and marketing of a computerized rifle/pistol
simulator which uses real weapons to provide the user with an accurate and
realistic shooting experience with the use of live ammunition. The user aims a
weapon at a video display screen and fires at a target on the screen. The system
also allows the user to obtain a computer printout of shots fired indicating
accuracy.
On April 5, 1999, the Company changed its name to Casino Pirata.com
Ltd. In February, 1999, the Company entered into agreements with WorldNet
Casinos.com, Inc. pursuant to which the Company owned and operated an Internet
gaming website.
On September 24, 1999, the Company entered into a Share Exchange
Agreement and Plan of Reorganization with Advantage Systems, Inc., a California
corporation, doing business as American Computer. Pursuant to that Agreement,
the Company acquired all of the issued and outstanding common stock of American
Computer, which became a wholly-owned subsidiary of the Company. American
Computer is a second-tier vendor and marketer of personal computers.
American Computer was originally formed in 1985. It was originally
known as American Cash Register, Inc., which was later shortened to ACR, Inc.
and then expanded to American Computer Research, Inc. In 1996, Advantage
Systems, Inc. acquired the name, phone and customer lists, inventory, and other
assets from American Computer Research, Inc. and commenced business as American
Computer.
On November 18, 1999, the Company changed its name to Advantage
Technologies, Inc. On December 1, 1999, the Company conveyed its interest in its
Internet gaming website to a newly- formed wholly owned subsidiary operating
under the name Casino Pirata.com Ltd.
<PAGE>
The Company is organized as a holding company with two wholly-owned
subsidiaries: Advantage Systems, Inc. and Casino Pirata.com Ltd.
BUSINESS AND OPERATING PLAN
ADVANTAGE SYSTEMS, INC.
At the present time. the Company's principal business activity will be
that of its wholly-owned subsidiary, Advantage Systems, Inc. ("ASI"). Under the
trade name of American Computer, ASI is a second-tier vendor and marketer of
personal computers. ASI builds high-quality, well-configured, top-of-the-line
computers that are reliable and competitively priced. ASI has the opportunity to
leverage its current self-sustaining position and realize substantial increases
in revenues and profits by expanding its direct sales programs targeting
high-growth segments - small- to medium-sized business, small office/home office
and mainstream corporate information technology and aggressively scaling-up its
already effective "just-in-time" component sourcing and assembly operations.
The total U.S. market for personal computers is projected to reach
$59.6 billion in 1999 and $65.0 billion in 2000, fueled by the Internet,
interactive applications, and demand for low-cost, network-ready multimedia
machines. The bulk of the personal computer business is conducted in the direct
sales channel and through the World Wide Web to which information technology
purchasing managers and technology-savvy consumers refer when seeking product
information, vendors, and pricing. Second-tier vendors account for about 45
percent of PCs sold, or $31.5 billion in the U.S. The Company believes this
could grow to over $120 billion by the year 2000, and ASI is now moving quickly
to capture market share where each percent of the business is worth more than $1
billion.
In pursuit of these objectives ASI has assembled an experienced
management team with a record of success in various technology enterprises.
Kenney Noel, Vice President of Purchasing, is responsible for ASI's
"just-in-time" purchasing model as well as all vendor relationships. Alfonso
Reyes, has been in Sales and Marketing for more than ten years and the
electronics industry over four years. George Bentley, Vice President Marketing
and E-Commerce, founded a successful information technology company and has
managed product development, manufacturing, sales, and installation for over
thirty seven years.
ASI builds a wide variety of personal computers for resale under the
American Computer name. Six basic systems are currently offered ranging from
low-end AMD K6-2 3D 350 MHz processors at $819 for first-time users to
sophisticated Intel Pentium 550 MHz Quad Xeon network servers priced up to
$14,999. With each basic system, customers can specify processor speed according
to price/performance needs. All systems include the latest microprocessors from
Intel and American Micro Devices, as well as graphics, multimedia, and
networking technologies; video and sound cards, color monitors, CD-ROM drives,
DVD-ROM drives, and onboard fax/modems.
<PAGE>
Products
ASI builds and markets high-quality personal computer systems for
corporate networked environments, as well as standalone systems for a wide
variety of applications. Overall, the existing product line under our own brand
name - American Computer - is in the introductory stage. The technology in our
products consists of the latest multimedia sound and video, and Internet/network
connectivity running primarily Windows 98 and NT platforms. Six basic products
are currently offered:
o An entry level system called the STUDENT is available in AMD
K6-2-3D 350 MHz through AMD K7 Athelon 550 MHz models, ranging in price
from $819 to $1,249. All versions include 64 MB RAM, 6.0 GB hard drive,
15-inch color monitor, 8 MB video card 56kbs voice/fax/modem, 44x
CD-ROM drive, 32-bit sound card, 120-watt speakers, keyboard, mouse,
and Microsoft Windows 98 software.
o The SCHOLAR product line is available in Intel Pentium III 450
through 600 MHz models, as well as AMD K7-500 and K7-550 models. All
versions include 64 MB RAM, 10.0 GB hard drive, 17-inch color monitor,
and upgraded versions of the STUDENT feature set. Prices range from
$1,019 to $1,269.
o The GRADUATE product line features Intel technology throughout,
13.0 GB hard drive, 8 MB 3-D video card, 44x CD-ROM drive, and 128-bit
SoundBlaster sound card, all in a mini-tower case. It is considered a
robust system for mature users and offers Pentium III, and AMD K7
versions running at speeds up to 550 MHz. Prices range from $1,379 to
$2,079.
o The PRO-FORMER system series offers most leading-edge
technologies. A favorite of software developers and state-of-the-art
consumers, it is available in the same versions as the GRADUATE at
prices ranging from $1,719 to $2,499 with 128 MB RAM, 18.0 GB hard
drive, 17-inch color monitor, 44x CD-ROM drive, 16 MB 3-D video card,
and 256-bit SoundBlaster sound card in a mini-tower case.
o The CAD-PRO II system is configured for engineering and CAD
markets, with various Dual Pentium III versions including MMX
technology. Prices range from $2,599 to $3,499 with all versions
including 256 MB RAM, 18.0 GB hard drive, 21-inch color monitor, and
other upgraded features, including bundled MS Windows NT 4.
o The NETWORK SERVE series is intended as an application or data
server expandable to accommodate 100-plus simultaneous users. It offers
very fast processing of extremely large data files and astronomical
calculations. The NETWORK SERVER comes in single, dual, and quadruple
Pentium III and Xeon versions ranging in price from $3,099 to $16,599.
All versions feature minimum 256 MB RAM, five 9.0 GB hard drives,
14-inch color monitor, 8 MB video card, an Intel 10/100 Ethernet card,
5 Kbs fax/modem, 44x CD-ROM drive, all in a full tower case. The
company also offers a version with up to four Pentium Pro 200s for less
than $15,000.
<PAGE>
ASI also sells top-quality name-brand systems for Compaq Computers as a
Value Added Reseller. To date sales have been nominal in this relationship which
is less than three months old. However, management feels this will uniquely
position the company to compete at all levels of Network and Web design,
configuration, sales, and installation.
We plan to follow these products with extensions to our line which
include network servers targeted at Internet Service Providers; thin-client PCs
targeting corporate, education, and government markets; and high-quality laptop
computers with extensive multimedia and Internet connectivity features.
ASI also offers high-quality laptop computers, and has positioned
itself to develop a revenue stream from this highly lucrative $21.5B market.
Research estimates anticipate a growth rate of 17.0% through the year 2000. ASI
will assemble units with ASI-specified components in accordance with market
opportunities.
A critical factor in the production of our products includes our
unique "just-in-time" approach to supply and inventory, which guarantees us the
flexibility we need to face this competitive and rapidly changing market. Our
business model is unique because if provides a method for assembling the best
configuration of final product at a competitive price., provides for a
continuous supply of product without the attendant inventory burden, and takes
advantage of known and proven marketing methodologies as a major component of
its overall business model.
ASI averaged 50 systems sold per month over the last twelve months.
All components are new and fully warranted by the original manufacturer, with
direct component costs running 80 percent for systems, 70 percent for
off-the-shelf sales. Using TechData, Ingram Micro, Ameriquest, Merisel, and
other national distributors for sourcing insures availability of product at the
lowest possible price on terms favorable to our operation.
With sales increasing, ASI will purchase desktops and laptops at
higher volume pricing direct from original (white boxes) manufacturers. Pricing
will then be relatively flexible versus the competition, and ASI will be better
positioned to control volume and maximize profits. The company will also realize
significant technical support, warranty, and return merchandise authorization
(RMA) advantages, will be able to acquire components at times when smaller
integrators - our primary competition - cannot, and will be better insulated
against temporary price swings during periods of product scarcity.
Marketing
ASI relies primarily on telemarketing and customer referral to
advertise its products for sale and secondarily on the world wide web. This form
of advertising results in approximately 20 to 50 systems sales per month
directly and 5 to 15 systems per month as referral business.
<PAGE>
The estimated worldwide installed base of x586 or older systems is
approximately 125,000,000 units, and those units will be replaced starting in
2000 as totally new chip technologies, operating systems, and software are
introduced. Due to its small size, flexibility of operations, and extensive
network of suppliers, Advantage Systems is strategically positioned to quickly
integrate and bring to market products configured with any new technologies, and
therefore capture a major share of the first-adopter market.
Our target market will be the small to medium sized business and Small
Office-Home Office where there is a real need for suppliers who can design and
install a networked environment. Traditionally they will buy both the lower-end
PC, where price is the primary factor, and the high-end PC, where component
technology is the primary factor.
ASI is basing its strategy on prior experience, as well as research
from national trade magazines that provide pricing analysis for specific market
segments and data on average system configurations within specific price ranges.
By following this research, as well as data collected from its own sales
records, ASI is able to optimize configuration and pricing of its systems in
positioning versus competition.
Our target markets do not have substantial seasonal components.
Historically, sales are relatively constant throughout the year, with the
exception of some downturn from December 20 to January 20 according to industry
studies. Our marketing plan will concentrate on generating direct sales through
telemarketing with known response potential. ASI will be using telemarketing as
its primary advertising vehicle and it's website, www.ampcomp.net as a secondary
sales tool. This marketing and sales strategy will drive our primary revenue
engine.
Competition
ASI competes directly with "second-tier" vendors - emerging companies
in the direct marketing channel. These are companies that are now established,
have good management teams, are generally well financed, and are moving up to
compete with the Top 5: Dell, Gateway, Compaq, IBM, and Micron. Their strengths
are size and adaptability. Their weakness is in their inability to manage the
increased pressure of financing and rapid growth, causing strained credit lines
and supplier relationships, and resulting in loss of focus.
Because of increased competition from the internet in the form of
auction houses and direct sellers whose business models and sales strategies
call for selling systems at or below cost, most companies in the "second-tier"
have been required to completely re-evaluate the way they do business. ASI has
not been exempt from this re-evaluation process.
The management of ASI believes that to survive and thrive there has to
be a value-add component to the offerings of a company in addition to price and
quality. Service is clearly the additional component. It comes in the form of
"build to order" systems, short delivery dates, flexibility of configuration,
price, and performance. All these things are offered in some degree by the
competition. We believe that the real value add has to be around the concept of
a one stop solution. A place where a customer's hardware needs can be assessed,
priced competitively, and
<PAGE>
delivered quickly, where operating software and networking can be engineered
into the equation, including cabling and installation. A place where a customer
can not only get computers, but a place that can design your website and have
you doing e-business in a short period of time. It is ASI's intent to be a full
service, one stop shop.
ASI's competitive advantage stems from the broad financial,
manufacturing, and marketing and sales experience of the management team. The
overall quality of our products; our consistently competitive pricing; the
strategic advantage of our "just-in-time" components sourcing; the flexible
setup envisioned for our assembly operations; and our willingness to embrace
change and go where the market is going.
Due to the competitive nature of the computer industry in general,
ASI, like it's competitors, has had to look to other avenues for sales of it's
systems outside the traditional print media/direct sales format. ASI has earned
the designation from Microsoft Corporation to advertise and hold itself out to
be a Microsoft Certified Solutions Provider. This has opened up new revenue
potential to ASI in the areas of customer based solutions for networking
installation and management, internet and intranet communications, website
development and hosting, as well as hardware sales and maintenance.
Because of the open architecture of the IBM PC clone, ASI is able to
compete technically as well as price wise with the biggest to the smallest names
in the industry. The latest components are available to ASI as quickly as they
are to Compaq, Dell, Gateway and others. With only a slight increase in monthly
volume, AST could become eligible to buy direct from many manufacturers, thereby
improving its ability to compete.
Strategy
ASI's market strategy is to become established as a leading one stop
supplier of solutions for information and communications technology which
include IBM PC Clones and related components and peripherals which allow end
users to perform the task they specify efficiently utilizing the latest
technology at very competitive prices. To do this, we will leverage its core
competencies, knowledge and expertise in the industry, to achieve market
penetration and gain a reasonable and growing market share.
ASI will need to identify, develop, and train telesales people which
reach its pre-identified target market with a direct sells campaign that is
effective and conveys the concept of American as a quality alternative to the
established system integrators who do not offer the full suite of services found
at ASI.
In order to be competitive, ASI will need to improve its sourcing so
as to maximize quality and minimize costs. Products will need to continue to be
delivered on time, with costs controlled, marketing budgets managed and assets
safeguarded. In addition, personnel with a variety of skills and experience will
have to be recruited, trained, and retained.
<PAGE>
Technology
At present, ASI neither owns nor licenses any technology with respect
to its products or services.
CASINO PIRATA. COM
Through its wholly-owned subsidiary, the Company operates an Internet gaming
site under the name Casino Pirata.com. The website address is
www.casinopirata.com. The gaming site is operated through a license agreement
with WorldNet Gaming, Inc. WorldNet Casinos.com, Inc. ("WorldNet") maintains its
headquarters in San Jose, Costa Rica and its U.S. marketing office in Fort
Lauderdale, Florida. WorldNet is in the business of developing JAVA(R) based
online casino software and licensing "turn-key" Internet casinos. In addition,
WorldNet operates two of its own Internet casinos.
The Company has a five (5) year license from WorldNet pursuant to a Software
License Agreement dated April 19, 1999. The Company paid WorldNet $150,000.00
for the license rights The license includes the following games: blackjack;
slots; pai-gow; video porker; roulette; instant bingo; and baccarat. Under the
license, WorldNet provides management services; technical support; marketing;
account and billing back office suite to view real-time sales; software
upgrades. For these services, WorldNet receives a management fee of 30% of the
net win.
WorldNet uses Internet proprietary encoding and processing technology, which
allows for security for financial transactions via the Internet. This technology
acts as an international currency converter and a secure Internet transaction
gateway to financial institutions for on-line merchants. SSL Internet Protocol
is used to provide privacy and reliability between he communicating
applications. SSL uses 12b bit encryption which ensures server and client
authentication through encrypted algorithms and cryptographic keys. WorldNet
also provides an additional level of security with an Address Verification
System validation, which validates submitted addresses with the casino player's
registered address to mitigate the use of stolen credit cards. Each casino
player registers on the website and is issued a unique Personal Identification
Number. WorldNet accepts both MasterCard and VISA credit cards.
To date the company has not received any income from this operation.
For all practical purposes, access to this site is open to the public, but
basically, only individuals with credit cards can gamble immediately. An
individual could mail in a check or money order and after some period of time an
account could be opened on their behalf, thus allowing them to wager up to the
amount of the credit in their account.
There does appear to be traffic to the website and some wagering
activity. Accounting information submitted to management by WorldNet Gaming,
Inc, while raw, incomplete, and unsubstantiated indicates some revenues and
traffic into the site on a monthly basis. However, all of the hardware,
software, and other elements of business control are in the hands of the
Franchisor WorldNet Gaming, Inc. To date management of WorldNet Gaming, Inc has
been
<PAGE>
unwilling to allow access to the original source records or to the financial
institution with which WorldNet Gaming, Inc operates through.
Financial control of the entire operation is through a special banking
relationship known as a Master Merchant Account Agreement. The Master Merchant
Account Agreement, which accommodates credit card transactions, appears to be a
wrap-around of an existing Master Merchant Account Agreement between WorldNet
Gaming, Inc and an as yet undisclosed foreign bank. The company has tried
unsuccessfully to obtain original source account documents from WorldNet Gaming,
Inc. Without access to these, determination of financial gain or loss is
impossible. Management has considered other legal remedies, however, WorldNet
Gaming, Inc. and all of their resources are located outside the United States of
America.
Therefore it is the view of management, at this time, that the
franchise agreement with WorldNet Gaming, Inc has no future economic value.
Management is in discussions with WorldNet Gaming, Inc and others for the
possibility of obtaining it's own software and Master Merchant Account Agreement
operated at it's own URL on it's own hardware. There are numerous hurdles to
overcome in this regard but the main ones are locating a financial institution
amenable to entering into a Master Merchant Account Agreement with
CasinoPirata.com for a gaming website, and raising the approximate $1,000,000
necessary to acquire software and hardware with which to setup a site in a host
country.
SIMULATOR SYSTEMS - EXCALIBORE
------------------------------
Through the Company's merger, when it was known as Simulator Systems, Inc, with
Marksmanship Training Centers, Inc. ("Marksmanship"), the Company acquired the
interest of Marksmanship in the development and marketing of an interactive
rifle/pistol simulator designed to improve marksmanship skills. The first
generation product was known as "Excalibore".
The product is a computerized system which uses real weapons to
provide the user with an accurate and realistic shooting experience without the
use of live ammunition. The user aims a weapon at a video display screen and
fires at a target on the screen which is chosen from a menu which includes full
and half-size silhouettes, both stationary or pop-up and a variety of
bull's-eyes.
The user can select firing ranges from 25 yards to 1,000 yards. A
camera device mounted on the barrel of the weapon "sees" the target through the
sights of the weapon in the same manner as the target is seen by the user. When
a shot is fired, the system instantaneously matches the information derived from
the camera alignment (the sight) to the corresponding pixel address on the
screen (the target) Algorithms compensate for distance and environmental
factors. The instant feedback on where the short hit or missed the target shows
the user how to adjust on subsequent shots.
Actual modified pistols and rifles are used so that the weight and
trigger action are real. Simulated recoil and sound lend authenticity to the
firing experience. To provide a close simulation of actual weapons fire, the
Excalibore has recoil action which is adjustable to the
<PAGE>
specific weapon attached. Earphones provide the actual sound of a weapon firing
and a printer records how far the shots hit or missed the target. The Excalibore
is compact in design and can be operated in a six by six foot area using
standard AC current.
Although the management of the Company when it was known as Simulator
Systems, Inc. aggressively attempted to market the Excalibore system to a
variety of users, including the U.S. armed forces, the Company's current
management has decided to cease further marketing efforts at this time.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
REVIEW OF OPERATING RESULTS
---------------------------
The following discussion should be read together with the financial
statements and the accompanying notes to the financial statements.
Operations of the Company for the year ended September 30, 1999
resulted in a net ordinary loss. One segment of the business, Advantage Systems,
dba American Computer, had net income from operations for the period, but this
was more than offset by the losses incurred in other segments of the Company.
Most of those losses are attributable to business segments which have
been abandoned and discontinued by management, specifically the franchise
relationship with WorldNet Gaming and the Excalibore system. While the Company's
present management can not be assured that there will be no future losses of the
type realized in the current period, management believes these losses were do to
a failure by the Company's previous management to investigate business basics
before undertaking the WorldNet Gaming franchise and the Excalibore system.
Management believes that the business plan it has developed for it's
primary business segment, Advantage Systems, Inc., is practical and executable
on a profitable basis in fiscal year 2000. However, management can make no
assurances of profitability. Additionally, management will have to raise
significant working capital to achieve these goals. The only practicable way
management can do this is through the sale of the Company's stock for which
there may be no market.
Our business plan calls for us to :
o Identify and acquire profitable new business segments by trading company stock
o Attempt to raise working capital from sale of company stock
o Execute on the business plans developed for the current owned business
segments
o Vigilantly manage costs and expenses so to as remain competitive
<PAGE>
CAPITAL NEEDS AND FUTURE REQUIREMENTS
-------------------------------------
The formation of Advantage Technologies, Inc was undertaken for a
number of reasons. These will be fully discussed in the course of the text of
this treatment. The primary reason is, as is customary, to segregate diverse
business segments into independently functioning operating units for economic,
managerial, and legal reasons. The initial and immediate focus of Advantage
Technologies, Inc.'s management will be towards its two principal wholly owned
subsidiaries. These are the wellspring from which future successes will depend.
It is also the intent of management to identify and acquire additional
operating entities on an ongoing basis. The candidates for acquisition which
management will attempt to locate will be primarily new, startup type entities
with technology oriented products with uses by large demographic users.
Because of Management's proximity to the San Francisco Bay Area and the
nature of one of it's principal subsidiary's business as a systems integrator,
management believes that many such acquisition opportunities will present
themselves. While it would not be in the best interest of the company to reveal
exactly the type, nature, and qualities of acquisition candidates, generally
management will be looking for acquisition candidates which have unique and
exploitable proprietary technology applicable to large demographics and
potential for vertical integration.
Management believes that what it has to offer to such candidates is
access to capital markets through its status as a publicly traded entity, as
well as its managerial depth which will be made available to exploit any
opportunities present in an acquisition candidate. Management intends all of its
acquisitions to be accomplished with very little, if any cash being exchanged.
It is the intent of company management to exchange common stock of Advantage
Technologies, Inc. for the stock of the target acquisition.
With respect to the Company's wholly owned subsidiary,
CasinoPirata.com, as reported elsewhere in this filing statement, its principal
business activity consists primarily as that of a corporate shell at this time.
There are currently no tangible assets, no income, no physical assets, and no
direct business activities of an ongoing nature in this corporation. Its
intangible assets are determined to be of no value. Management has determined
that the franchise agreement held by it and issued by WorldNet Gaming, Inc. Has
no economic value.
While the franchise itself is of no value, management strongly believes
that the fundamental underlying business concept is one of enormous business and
profit potential. The industry predictions for the gaming business and
especially the online gaming industry show tremendous growth potential on a
global basis. To date, only a few of the large Las Vegas and Atlantic City and
New Jersey gaming establishments have entered into this enormous new area of
e-commerce. Most studies show that there is a global market that is
significantly larger than
<PAGE>
the one that is being exploited within the areas of the United States where
casino gambling is legal. Management is currently assessing the business
opportunity represented here to determine how to best proceed in attempting to
gain successful entry into this market.
Since involving itself in the gaming business by acquiring the
franchise with WorldNet Gaming, Inc., the company's management team has changed.
The current management team is responsible for determining that the agreement
between WorldNet Gaming, Inc. is of no value to the company. In the process of
making this determination, a number of important factors were analyzed which
gave rise to the determination of worthlessness of the franchise. These same
factors were determined to be critical for any company to be successful in the
online gaming business.
Therefore, in order for CasinoPirata.com to be successful in the
online gaming business, management has determined that the following conditions,
at a minimum, must be satisfied:
(1) A Master Merchant Account Agreement with an accredited financial
institution must be established;
(2) Proprietary gaming software must be identified and acquired. The
software has to be renderable in multiple languages;
(3) A site must be located and secured in an environment where
operating a business of this type is legal;
(4) Parameters of hardware and software requirements to support peak
demand must be determined;
(5) Technical personnel to operate the hardware and software have to
be recruited and trained and put in place. This is a twenty-four
hours a day/seven days per week/52 weeks per year business. An
attorney with experience in international gaming law must be
identified and retained;
(6) A marketing plan must be developed to drive internet traffic to
this site on a global basis and personnel acquired to accomplish
these goals;
(7) Funds sufficient to accomplish all of the above are required.
While this not an exhaustive treatment of a business model for online
gaming, these are some of the fundamentals which management has determined to be
necessary in order to go forward. Management's best estimate of the cost to
accomplish all of the above is approximately $1,000,000. Management currently
does not have sufficient working capital to undertake online gaming. At this
time, management does not have a financing plan. Management is aware that other
more established and better financed organizations with expertise in the gaming
industry are either already online or are considering entering the online gaming
industry.
<PAGE>
With respect to Advantage Technologies, Inc.'s wholly owned subsidiary,
Advantage Systems, Inc, its principal business activity consists primarily as
that of a systems integrator. However, as a response to increased competition,
especially around pricing and dwindling profit margins, Advantage Systems, Inc.
has moved in the direction of a Value Added Reseller and service model. In this
model, the traditional systems integrator adds branded product lines to their
existing proprietary product lines and models, and service, related usually to
application software, operating systems software, or website development.
Advantage Systems, Inc. continues to be a systems integrator and its' sales of
computers consists primarily of its' own brand, "American Computer" systems.
However, Advantage Systems has added Compaq and Hewlett Packard to its offerings
of hardware. The company also sells a wide variety of Branded Network
connectivity products such as Intel, 3COM, CISCO, Bay Networks, SMC, Ascend, and
Asante. Advantage Systems, Inc, also has become a Microsoft Certified Solutions
Provider.
This enables the Company to advertise offerings of hardware,
installation, networking services and installation of operating systems,
including all cabling, switching devices, routers, and hubs, installations with
a solid basis and expertise, which the public wants. The profit margins in these
service and networking areas are substantially higher than from hardware. This
bundle of goods and services can be and is often separated and sold
individually, but usually one provides a doorway through which to sell the
others.
In the business model management has developed, the primary target is
the small and/or startup business. The reasons for this are that there are
numerous such businesses that need the kind of expertise and service which the
Company offers on an incremental or part-time basis. These businesses need
custom designed as well as "off-the-shelf" hardware solutions such as offered by
the Company. These businesses also need internet access and connectivity,
including category 5 cabling. Lastly, these business need website development,
consulting and design. The Company offers all of these goods and services.
In this business model, management has determined that duplication for
purposes of growth is relatively simple and straightforward. Management's'
intent is to develop the techniques we currently use to develop sales leads for
our Silicon Valley area to the point of acceptable efficiency. We anticipate
less than a year to perfect these techniques. Once we are efficient in the sales
lead generation segment, management intends to expand the outside sales force to
new communities and open outside sales offices in these newly identified areas.
<PAGE>
At this time, management has determined, that all that will be needed is:
(1) The acquisition of the data relating to the demographics which we have
established;
(2) Adequate 1-800 number service;
(3) Apply the same telesales techniques for sales lead generation locale
sales office for outside sales personnel;
(4) Outside sales personnel;
(5) software and hardware installation technicians for installations.
All management, purchasing, accounting, support and customer service
will be directed from the corporate office in San Jose, California.
The Company's marketing strategy is relatively simple. We obtain
database information relative to the marketing demographic parameters, which we
have predetermined. We use professional telesales individuals coupled with a
direct mailing of collateral materials to our predetermined demographics. Once a
level of interest is established, a professional sales representative is
scheduled for an onsite interview with the prospective client where an
assessment is made of the client's requirements. Often, in this environment, our
sales people are able to offer alternatives which are more effective and at
times less expensive. Typically, we do not charge for this consulting service.
There are incremental costs associated with hiring telesales
professionals. Usually, within a short period of time after adding a telesales
professional, one or more outside sales professionals have to be added. This
results in a slight increase in overhead initially, and it is hoped a
significant increase in sales shortly thereafter. We monitor telesales and
outside sales to be sure we meet the goals we set from monthly self-assessment
sales meetings.
We are able to keep our investment in inventory low as we utilize
just-in-time purchasing and inventory techniques. The largest costs to be
financed in this model are the Accounts Receivable/ Work-in-Progress costs. We
keep this as low as possible by billing all hardware on delivery. Service work
is billed incrementally, beginning with a retainer if the job appears to be
longer than thirty days. We also, as a policy, add technical personnel on a full
time basis only when the revenue related to that aspect of business justifies
the slot. Some of the financing of operations comes from trade creditors.
Advantage Systems has been in this business for over 16 years now and we do have
favorable terms with most of our suppliers. Another source of financing
historically has been from retained profits being put back into the business. It
is estimated for every incremental $1,000,000 in gross business, an additional
$100,000 in working capital is required. Advantage Systems is projecting a
growth of $1,500,000
<PAGE>
in sales for the fiscal year-end September 30, 2000. According to this model an
additional $150,000 in working capital will be required. Management expects to
meet the need in part by retaining earnings from operations. Additionally,
management expects to sell common stock to meet these and other cash flow
requirements. Management understands that there may not be a market for the
stock it expects to offer for sale.
YEARS 2000 COMPLIANCE
- ---------------------
Advantage Technologies, Inc. and Advantage Systems, Inc. rely on
computers for all of the customary uses that any technology related company
would rely upon them. In addition to these concerns, the very nature of our
business put us at the front of the problem and the solution. The century date
change occurred without incident.
The Company has sold thousands of systems to the general public over
the course of the last sixteen years. While only a fraction of those could
result in any exposure to the Company in terms of warranty related problems,
none have resulted in a reported claim to the Company.
This comes as no surprise to management inasmuch as the problem was
primarily related to the BIOS (Basic Input/Output System) Programs found onboard
all motherboards of IBM PC Clones. Most highend motherboard manufacturers, as
well as most BIOS chip manufacturers, made the required corrections early in
1998. All of the legacy systems still in use older than two years could solve
the problem by going online and downloading an update patch for their BIOS from
the manufacturer well prior to December 31, 1999. To date we have had only one
system returned with a potential Y2K problem and it was resolved and returned to
the customer within 72 hours with only a small charge to the customer. We
anticipate no further material consequences as a result of the century date
change.
ACQUISITION OF GO FATHOM CONSULTING AGREEMENT
On March 31, 2000 the Company entered into a consulting agreement between the
Company and the following individual professional persons who acted as
consultants to the Company: M. Richard Cutler, Brian A. Lebrecht, Vi Bui, and
Asher Starik for services involving consultation, advice and counsel with
respect to the negotiation and completion of the stock exchange between
Advantage and Go Fathom. In addition to cash compensation, the agreement
calls for issuance of a total of 1,540,000 shares of Advantage to be
issued to the consultants together with an obligation for the Company to
register such shares on Form S-8.
PROPERTY
The Company maintains its principal administrative and executive
offices at 1324 S. Mary Ave., Sunnyvale, CA 94087 consisting of approximately
800 square feet of office space and 600 square feet of assembly and shipping
space. The Company expects this facility to be adequate for its needs for the
next six months. The Company is now looking for a facility more suited to
light-industrial assembly that will accommodate anticipated expansion in the
near future.
<PAGE>
RISK FACTORS
In this section we highlight some of the risks associated with our business
and operations. Prospective investors should carefully consider the following
risk factors when evaluating an investment in the common stock offered by this
Reoffer Prospectus.
RISKS RELATED TO OUR BUSINESS
YOU MAY BE UNABLE TO EFFECTIVELY EVALUATE OUR COMPANY FOR INVESTMENT PURPOSES
BECAUSE OUR BUSINESS HAS EXISTED FOR ONLY A SHORT PERIOD OF TIME.
We began our current business in 1999. As a result, we have only a limited
operating history upon which you may evaluate our business and prospects. In
addition, you must consider our prospects in light of the risks and
uncertainties encountered by companies in an early stage of development in new
and rapidly evolving markets.
YOUR INVESTMENT MAY NOT INCREASE IN VALUE UNLESS WE ARE ABLE TO BECOME
PROFITABLE. We have incurred losses in our business operation since inception.
We expect to continue to lose money for the foreseeable future, and we cannot be
certain when we will become profitable, if at all. Failure to achieve and
maintain profitability may adversely affect the market price of our common
stock.
WE ARE PRESENTLY IN UNSOUND FINANCIAL CONDITION WHICH MAKES INVESTMENT IN
OUR SECURITIES HIGHLY RISKY. Our financial statements include an auditor's
report containing a modification regarding an uncertainty about our ability to
continue as a going concern. Our financial statements also include an
accumulated deficit of $1,032,067 as of September 30, 1999 and other indications
of weakness in our present financial position. We have been operating primarily
through the issuance of common stock for services by entities, including
affiliates, that we could not afford to pay in cash. We are consequently deemed
by state securities regulators to presently be in unsound financial condition.
No person should invest in this offering unless they can afford to lose their
entire investment.
OUR BUSINESS DEPENDS ON A FEW KEY INDIVIDUALS AND MAY BE NEGATIVELY
AFFECTED IF WE ARE UNABLE TO KEEP OUR KEY PERSONNEL. Our future success depends
in large part on the skills, experience and efforts of our key marketing and
management personnel. The loss of the continued services of any of these
individuals could have a very significant negative effect on our business. In
particular, we rely upon the experience of George J. Bentley, our President
and Chief Executive Officer. We do not currently maintain a policy of key man
life insurance on any of our employees or management team.
<PAGE>
OUR BUSINESS PLAN REQUIRES ADDITIONAL PERSONNEL AND MAY BE NEGATIVELY
AFFECTED IF WE ARE UNABLE TO HIRE AND RETAIN NEW SKILLED PERSONNEL. Qualified
personnel are in great demand throughout our industry. Our success depends
in large part upon our ability to attract, train, motivate and retain highly
skilled sales and marketing personnel and other senior personnel. Our failure to
attract and retain the highly trained technical personnel that are integral
to our direct sales, product development, service and support teams may limit
the rate at which we can generate sales and develop new products and services or
product and service enhancements. This could hurt our business, operating
results and financial condition.
OUR TECHNOLOGY BUSINESSES OWN PROPRIETARY TECHNOLOGY AND OUR SUCCESS
DEPENDS ON OUR ABILITY TO PROTECT THAT TECHNOLOGY. The unauthorized
reproduction or other misappropriation of our proprietary technology could
enable third parties to benefit from our technology without paying us for it.
This could have a material adverse effect on our business, operating results and
financial condition. We have relied primarily on the use of trade secrets to
protect our proprietary technology, which may be inadequate. We do not know
whether we will be able to defend our proprietary rights because the validity,
enforceability and scope of protection of proprietary rights in Internet-related
industries are uncertain and still evolving. Moreover, the laws of some foreign
countries are uncertain and may not protect intellectual property rights to the
same extent as the laws of the United States. If we resort to legal proceedings
to enforce our intellectual property rights, the proceedings could be burdensome
and expensive and could involve a high degree of risk.
WE WILL INCUR SIGNIFICANT EXPENSES IF OTHER COMPANIES CLAIM WE HAVE
INFRINGED ON THEIR PROPRIETARY RIGHTS. Although we attempt to avoid infringing
known proprietary rights of third parties, we are subject to the risk of claims
alleging infringement of third party proprietary rights. If we were to discover
that any of our products violated third party proprietary rights, there can be
no assurance that we would be able to obtain licenses on commercially reasonable
terms to continue offering the product without substantial reengineering or that
any effort to undertake such reengineering would be successful. We do not
conduct comprehensive searches to determine whether the technology used in our
products infringes patents, trademarks, tradenames or other protections held by
third parties. In addition, product development is inherently uncertain in a
rapidly evolving technological environment in which there may be numerous patent
applications pending, many of which are confidential when filed, with regard to
similar technologies. Any claim of infringement could cause us to incur
substantial costs defending against the claim, even if the claim is invalid, and
could distract our management from our business. Furthermore, a party making
such a claim could secure a judgment that requires us to pay substantial
damages. A judgment could also include an injunction or other court order that
could prevent us from selling our products. Any of these events could have a
material adverse effect on our business, operating results and financial
condition.
IF WE ARE UNABLE TO RAISE SUFFICIENT CAPITAL IN THE FUTURE, WE MAY NOT BE
ABLE TO STAY IN BUSINESS. Currently, our capital is insufficient to conduct our
business and if we are unable to obtain needed financing, we will be unable to
promote our products and services, engage in and exploit potential business
opportunities and otherwise maintain our competitive position. Since we intend
to grow our business rapidly, it is certain that we will require additional
capital. We have not thoroughly investigated whether this capital would be
available, who would provide it, and on what terms. If we are unable to raise
the capital required to fund our growth, on acceptable terms, our business may
be seriously harmed or even terminated.
<PAGE>
RISKS RELATED TO THIS OFFERING AND OWNERSHIP OF OUR STOCK.
OUR BOARD OF DIRECTORS CAN ISSUE PREFERRED STOCK WITHOUT SHAREHOLDER
CONSENT AND DILUTE OR OTHERWISE SIGNIFICANTLY AFFECT THE RIGHTS OF EXISTING
SHAREHOLDERS. Our articles of incorporation provide that preferred stock may be
issued from time to time in one or more series. Our board of directors is
authorized to determine the rights, preferences, privileges and restrictions
granted to and imposed upon any wholly unissued series of preferred stock and
the designation of any such shares, without any vote or action by our
shareholders. The board of directors may authorize and issue preferred stock
with voting power or other rights that could adversely affect the voting power
or other rights of the holders of common stock. In addition, the issuance of
preferred stock could have the effect of delaying, deferring or preventing a
change in control, because the terms of preferred stock that might be issued
could potentially prohibit the consummation of any merger, reorganization, sale
of substantially all of its assets, liquidation or other extraordinary corporate
transaction without the approval of the holders of the outstanding shares of the
preferred stock.
YOU MAY NOT BE ABLE TO SELL YOUR STOCK, OR MAY BE FORCED TO SELL AT REDUCED
PRICES, BECAUSE THE MARKET FOR OUR COMMON STOCK IS VERY VOLATILE. Our stock is
presently trading on the OTC bulletin board maintained by Nasdaq under the
symbol ADVV. Nevertheless, there has been limited volume in trading in the
public market for the common stock, and there can be no assurance that a more
active trading market will develop or be sustained. The market price of the
shares of common stock is likely to be highly volatile and may be significantly
affected by factors such as fluctuations in our operating results, announcements
of technological innovations or new products and/or services by us or our
competitors, governmental regulatory action, developments with respect to
patents or proprietary rights and general market conditions.
<PAGE>
YOU MAY NOT BE ABLE TO SELL YOUR SHARES BECAUSE OF THE PENNY-STOCK RULES.
The Securities Enforcement and Penny Stock Reform Act of 1990 requires
additional disclosure relating to the market for penny stocks in connection with
trades in any stock defined as a penny stock. The Commission has adopted
regulations that generally define a penny stock to be any equity security that
has a market price of less than $5.00 per share, subject to a few exceptions.
Such exceptions include any equity security listed on Nasdaq and any equity
security issued by an issuer that has
- - net tangible assets of at least $2,000,000, if such issuer has been in
continuous operation for three years,
- - net tangible assets of at least $5,000,000, if such issuer has been in
continuous operation for less than three years, or
- - average annual revenue of at least $6,000,000, if such issuer has been in
continuous operation for less than three years.
Unless an exception is available, the regulations require the delivery, prior to
any transaction involving a penny stock, of a disclosure schedule explaining the
penny stock market and the risks associated therewith.
FORWARD LOOKING STATEMENTS. Except for historical information, the
discussion in this registration statement contains some forward-looking
statements that involve risks and uncertainties. These statements may refer to
our future plans, objectives, expectations and intentions. These statements may
be identified by the use of the words such as expect, anticipate, believe,
intend, plan and similar expressions. Our actual results could differ materially
from those anticipated in such forward-looking statements.
USE OF PROCEEDS
ADVV will not receive any of the proceeds from the sale of shares of common
stock by the Selling Shareholders.
<PAGE>
SELLING SHAREHOLDERS
The Shares of the Company to which this Reoffer Prospectus relates are being
registered for reoffers and resales by the Selling Shareholders, who acquired
the Shares pursuant to a compensatory benefit plan with ADVV for consulting
services they provided to ADVV. The Selling Shareholders may resell all, a
portion or none of such Shares from time to time.
The table below sets forth with respect to the Selling Shareholders, based upon
information available to the Company as of March 31, 2000, the number of
Shares owned, the number of Shares registered by this Reoffer Prospectus and the
number and percent of outstanding Shares that will be owned after the sale of
the registered Shares assuming the sale of all of the registered Shares.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
NUMBER OF NUMBER OF % OF SHARES
SHARES SHARES NUMBER OF OWNED BY
SELLING OWNED REGISTERED BY SHARES OWNED SHAREHOLDER
SHAREHOLDERS BEFORE SALE PROSPECTUS AFTER SALE AFTER SALE
- ----------------- ------------- ------------- ------------ ------------
M. Richard Cutler 1,126,125 (1) 500,500 625,625 2.3%
- ----------------- ------------- ------------- ------------ ------------
Brian A. Lebrecht 346,500 154,000 192,500 less than 1%
- ----------------- ------------- ------------- ------------ ------------
Vi Bui 259,875 115,500 144,375 less than 1%
- ----------------- ------------- ------------- ------------ ------------
Asher Starik 962,500 770,000 192,500 less than 1%
- ----------------- ------------- ------------- ------------ ------------
</TABLE>
(1) Of such shares, 625,625 are held by MRC Legal Services, LLC. M. Richard
Cutler is the beneficial owner of MRC Legal Services, LLC.
PLAN OF DISTRIBUTION
The Selling Shareholders may sell the Shares for value from time to time under
this Reoffer Prospectus in one or more transactions on the Over-the-Counter
Bulletin Board maintained by the NASD, or other exchange, in a negotiated
transaction or in a combination of such methods of sale, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at prices otherwise negotiated. The Selling Shareholders may effect
such transactions by selling the Shares to or through brokers-dealers, and such
broker-dealers may receive compensation in the form of underwriting discounts,
concessions or commissions from the Selling Shareholders and/or the purchasers
of the Shares for whom such broker-dealers may act as agent (which compensation
may be less than or in excess of customary commissions).
<PAGE>
The Selling Shareholders and any broker-dealers that participate in the
distribution of the Shares may be deemed to be "underwriters" within the meaning
of Section 2(11) of the 1933 Act, and any commissions received by them and any
profit on the resale of the Shares sold by them may be deemed be underwriting
discounts and commissions under the 1933 Act. All selling and other expenses
incurred by the Selling Shareholders will be borne by the Selling Shareholders.
In addition to any Shares sold hereunder, the Selling Shareholders may, at the
same time, sell any shares of common stock, including the Shares, owned by him
or her in compliance with all of the requirements of Rule 144, regardless of
whether such shares are covered by this Reoffer Prospectus.
There is no assurance that the Selling Shareholders will sell all or any portion
of the Shares offered.
The Company will pay all expenses in connection with this offering other than
the legal fees incurred in connection with the preparation of this registration
statement and will not receive any proceeds from sales of any Shares by the
Selling Shareholders.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for the
Company by Robert Laskowski, Esq.
EXPERTS
The balance sheets as of September 30, 1999 and 1998 and the statements of
operations, shareholders' equity and cash flows for each of the three years in
the period ended September 30, 1999 have been incorporated by reference in this
Registration Statement in reliance on the report of Timothy L. Steers, Certified
Public Accountant, LLC, given on the authority of that firm as experts in
accounting and auditing.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents are hereby incorporated by reference in this
Registration Statement:
(i) Registrant's Form 8-K for an event on March 31, 2000, filed on April 3,
2000.
(ii) Registrant's Form 10-SB, as amended (in the name of Go Fathom Group,
Inc., the Company's predecssor), originally filed on November 17, 1999.
(iii) All other reports and documents subsequently filed by the Registrant
pursuant after the date of this Registration Statement pursuant to Sections
13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 and prior to
the filing of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference and to be a part hereof
from the date of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Corporation Laws of the State of Nevada and the Company's Bylaws
provide for indemnification of the Company's Directors for liabilities and
expenses that they may incur in such capacities. In general, Directors and
Officers are indemnified with respect to actions taken in good faith in a manner
reasonably believed to be in, or not opposed to, the best interests of the
Company, and with respect to any criminal action or proceeding, actions that the
indemnitee had no reasonable cause to believe were unlawful. Furthermore, the
personal liability of the Directors is limited as provided in the Company's
Articles of Incorporation.
23
<PAGE>
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The Shares were issued for advisory and legal services rendered. These
sales were made in reliance of the exemption from the registration requirements
of the Securities Act of 1933, as amended, contained in Section 4(2) thereof
covering transactions not involving any public offering or not involving any
"offer" or "sale".
ITEM 8. EXHIBITS
*2.1 Articles of Merger and Plan of Merger dated April 21, 1998
between Vortices, Inc. and Simulator Systems.
*2.2 Share Exchange Agreement and Plan of Reorganization dated
September 24, 1999 , and amendment thereto, between Casino
Pirata.com Ltd, Advantage Systems, Inc. and the shareholders
of Advantage Systems, Inc.
*3.1 Articles of Incorporation of Advantage Technologies, Inc. and
Amendments thereto.
*3.2 Articles of Incorporation of Advantage Systems, Inc.
*3.3 Articles of Incorporation of CasinoPirata.com Ltd.
*3.4 Bylaws of Advantage Technologies, Inc.
*3.5 Bylaws of Advantage Systems, Inc.
*3.6 Bylaws of Casino Pirata.com Ltd.
5 Opinion of Robert Laskowski, Esq.
10.1 Consulting Agreement dated March 31, 2000.
23.1 Auditor's Consent
________________________
* Incorporated by reference to ADVV's Form 8-K, filed on April 3, 2000.
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement to include any material
information with respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such information in the
Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's Annual Report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
<PAGE>
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that is meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Sunnyvale, State of California, on April 5, 2000.
ADVANTAGE TECHNOLOGIES, INC.
/s/ George J. Bentley
By: George J. Bentley
Its: President and Chief Executive Officer
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 dates indicated.
/s/ George J. Bentley
- -------------------------------------------------------
George J. Benley, President, Chief Executive Officer and Director
/s/ Kenney F. Noel
- -------------------------------------------------------
Kenney F. Noel, Secretary and Director
/s/ Yoshi Iwagami
- -------------------------------------------------------
Yoshi Iwagami, Director
/s/ Corinna A. Stolp
- -------------------------------------------------------
Corinna A. Stolp, Director
/s/ Matthew L. Dodson
- -------------------------------------------------------
Matthew L. Dodson, Director
[LETTERHEAD]
April 5, 2000
Securities and Exchange Commission
Division of Corporate Finance
Washington, D.C. 20549
Re: Advantage Technologies, Inc.
Ladies and Gentlemen:
This office represents Advantage Technologies, Inc., a Nevada
corporation (the "Registrant") in connection with the Registrant's Registration
Statement on Form S-8 under the Securities Act of 1933 (the "Registration
Statement"), which relates to the resale of up to 1,540,000 shares by certain
selling shareholders in accordance with a Consulting Agreement between the
Registrant and the selling shareholders (the "Registered Securities"). In
connection with our representation, we have examined such documents and
undertaken such further inquiry as we consider necessary for rendering the
opinion hereinafter set forth.
Based upon the foregoing, it is our opinion that the Registered Securities,
when issued as set forth in the Registration Statement, will be legally issued,
fully paid and nonassessable.
We acknowledge that we are referred to under the heading "Legal Matters" in
the Resale Prospectus which is a part of the Registrant's Form S-8 Registration
Statement relating to the Registered Securities, and we hereby consent to such
use of our name in such Registration Statement and to the filing of this opinion
as Exhibit 5 to the Registration Statement and with such state regulatory
agencies in such states as may require such filing in connection with the
registration of the Registered Securities for offer and sale in such states.
Very truly yours,
/s/ Robert Laskowski
Robert Laskowski
Attorney at Lawa
CONSULTING AGREEMENT
CONSULTING AGREEMENT dated as of March 31, 2000 between ADVANTAGE
TECHNOLOGIES, INC., a Nevada corporation, ("ADVV"), on the one hand, and M.
RICHARD CUTLER ("Cutler"), BRIAN A. LEBRECHT ("Lebrecht"), VI BUI ("Bui"), and
ASHER STARIK ("Starik", and, together with Cutler, Lebrecht, and Bui, the
"Consultants"), on the other hand.
WHEREAS:
A. Consultants have agreed to render consulting services with regard to
the negotiation and completion of a stock exchange between ADVV and the majority
shareholder of Go Fathom Group, Inc., a Delaware corporation (the "Go Fathom
Shareholder").
B. In the event ADVV is able to complete the Stock Exchange with the Go
Fathom Shareholder, ADVV wishes to compensate Consultants for their consulting
services.
NOW THEREFORE, it is agreed:
1. Stock Compensation. ADVV shall pay and cause to be issued to the
-------------------
Consultants a consulting fee of $100,000 cash, plus 1,540,000 shares of common
stock of ADVV (the "Shares") immediately upon the execution of a stock exchange
agreement with the Go Fathom Shareholder. Such shares shall be subject to
registration by ADVV on Form S-8 within 5 days of ADVV closing on the stock
exchange agreement with the Go Fathom Shareholder. The Consultants agree to
prepare and file the S-8 Registration Statement at their sole expense, except
for the filing fee associated therewith, which shall be reimbursed by ADVV. The
parties agree that the value of the Shares is equal to 50% of the closing bid
price on the date of this Agreement. The Shares shall be issued as follows:
500,500 to Cutler, 154,000 to Lebrecht, 115,500 to Bui, and 770,000 to Starik.
2. Miscellaneous. This Agreement (i) shall be governed by the laws of
-------------
the State of California; (ii) may be executed in counterparts each of which
shall constitute an original; (iii) shall be binding upon the successors,
representatives, agents, officers and directors of the parties; and (iv) may not
be modified or changed except in a writing signed by all parties.
<PAGE>
This Consulting Agreement has been executed as of the date first above
written.
ADVANTAGE TECHNOLOGIES, INC.
/s/ George J. Bentley
____________________________________________________
By: George J. Bentley, President
CONSULTANTS
/s/ M. Richard Cutler
____________________________________________________
M. Richard Cutler
/s/ Brian A. Lebrecht
____________________________________________________
Brian A. Lebrecht
/s/ Vi Bui
____________________________________________________
Vi Bui
/s/ Asher Starik
____________________________________________________
Asher Starik
INDEPENDENT AUDITOR'S REPORT
To The Board of Directors of Advantage Technologies, Inc.
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 1, 2000 relating to
the financial statements of Advantage Technologies, Inc.
/s/ Timothy L. Steers
Timothy L. Steers
Certified Public Accountant, LLC
April 5, 2000
