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As filed with the Securities and Exchange Commission on January 8, 2001.
Registration No. 333-91819.
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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 2
To
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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MindArrow Systems, Inc.
(formerly eCommercial.com, Inc.)
(Exact name of registrant as specified in charter)
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<S> <C> <C>
Delaware 7372 77-0511097
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
101 Enterprise, Suite 340
Aliso Viejo, California 92656
Telephone: (949) 916-8705
(Address, including ZIP code and telephone number, including area code, of
registrant's principal executive offices)
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Michael R. Friedl
Chief Financial Officer
MindArrow Systems, Inc.
101 Enterprise, Suite 340
Aliso Viejo, California 92656
Telephone: (949) 916-8705
(Name, address, including ZIP code, and telephone number,
including area code, of agent for service)
Copies to:
Attention: J. Jay Herron, Esq.
Andor D. Terner, Esq.
Loren J. Weber, Esq.
O'Melveny & Myers LLP
114 Pacifica, Suite 100
Irvine, California 92618
Telephone: (949) 737-2900
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
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. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act Registration Statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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.
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These securities have not been approved or disapproved by the Securities and
Exchange Commission or any state securities commission nor has the Securities
and Exchange Commission or any state securities commission passed upon the
accuracy or adequacy of this Prospectus. Any representation to the contrary is
a criminal offense.
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PART II:
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13: Other Expenses of Issuance and Distribution
The estimated expenses payable in connection with the issuance and
distribution of the securities being registered are as follows:
<TABLE>
<S> <C>
SEC registration fee............................................... $ 26,486
Legal fees and expenses............................................ 175,000
Accounting fees and expenses....................................... 100,000
Printing and engraving expense..................................... 110,000
Transfer agent fees and expenses................................... 10,000
Miscellaneous...................................................... 5,000
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TOTAL............................................................ $426,486
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</TABLE>
Except for the SEC registration fee, the above amounts are estimated. The
selling stockholders shall not bear any of the above expenses.
Item 14: Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law ("DGCL") provides that a
corporation may indemnify such person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or proceeding,
whether civil, criminal, administrative or investigative, by reason of the fact
that such person is or was a director, officer, employee or agent of the
corporation or is or was serving at its request in such capacity in another
corporation or business association, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if such
person acted in good faith and in a manner such person reasonably believed to
be in or not opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful.
Section 102(b)(7) of the DGCL permits a corporation to provide in its
certificate of incorporation that a director of the corporation shall not be
personally liable to the corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability (i) for any
breach of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the DGCL, or (iv) for any transaction from which the director derived an
improper personal benefit.
As permitted by Section 102(b)(7) of the DGCL, our Amended and Restated
Certificate of Incorporation includes a provision that limits a director's
personal liability to us or our stockholders for monetary damages for breaches
of his or her fiduciary duty as a director. Article VII of our Amended and
Restated Certificate of Incorporation provides that none of our directors shall
be personally liable to us or our stockholders for monetary damages for breach
of fiduciary duty to the fullest extent permitted by the DGCL.
As permitted by Section 145 of the DGCL, our Bylaws provide that, to the
fullest extent permitted by the DGCL, directors, officers and certain other
persons who are made, or are threatened to be made, parties to, or are involved
in, any action, suit or proceeding will be indemnified by us with respect
thereto. Article VII of our Bylaws provides for the indemnification of our
officers, directors, employees and agents if such person acted in good faith
and in a manner reasonably believed to be in and not opposed to our best
interest, and, with respect to any criminal action or proceeding the
indemnified party had no reason to believe his conduct was unlawful.
We maintain insurance policies under which our directors and officers are
insured, within the limits and subject to the limitations of the policies,
against expenses in connection with the defense of actions, suits or
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proceedings, and certain liabilities that might be imposed as a result of such
actions, suits or proceedings, to which they are parties by reason of being or
having been our directors or officers. We also entered into agreements to
indemnify our directors, in addition to the indemnification provided for in our
Amended and Restated Certificate of Incorporation and Bylaws.
Item 15: Recent Sales of Unregistered Securities
Transactions prior to April 1999 were initiated by Wireless Netcom and its
predecessor company, Rubicon Sports. As described in the following paragraphs,
all preferred shares and convertible debt balances were converted into common
stock upon the merger of Wireless Netcom and eCommercial California in April
1999. As of December 18, 2000, we had only Series B and Series C preferred
stock and common stock outstanding.
In June 1998, we undertook a private offering of non-interest bearing
Promissory Notes (the "Notes") maturing twelve months from the date of
issuance. Originally, the Notes were convertible into common stock by each
investor no earlier than thirty days following commencement of trading of our
common stock on the OTC Bulletin Board. We received subscriptions totaling
$500,000 from 11 individual and 3 institutional accredited investors. The
investors were Dallas Self, Rick Self, Richard Hennig, Sport of Kings, Carolyn
Peterson, IRA, Peterson Family Trust, Marta Modine Solomon, Wilson Peterson,
IRA, ICB, Anthony Romano, III, Kirk Olson, Grant Weststeyn, Wagnon and
Marguerite Rogers. Concurrent with the merger of Wireless Netcom and
eCommercial California, these Notes were converted into 166,667 shares of our
common stock.
In July 1998, we undertook a $500,000 private offering of 6% Convertible
Promissory Notes to six individual accredited investors. The investors were
Richard Self, Kirk Rand Olson, Anthony N. Romano, III, Pablo & Rhonda
Fernandez, Barry & Mrs. Cheryl Christian and Larry W. Fuqua. Originally, the
Notes matured twelve months from the date of issuance and were convertible into
common stock thirty days following commencement of trading of our common stock
on the OTC Bulletin Board. The number of shares into which the Notes were
convertible was determined by dividing the dollar amount of such amount by the
preceding five day average closing bid price of the shares, discounted by
twenty percent, as quoted on the OTC Bulletin Board. Concurrent with the merger
of Wireless Netcom and eCommercial California, these Notes were converted into
166,667 shares of our common stock.
In April 1999, we undertook a private placement of our common stock, at
prices from $1 to $4 per share to 2 institutional and 22 individual accredited
investors, all of whom are included in the selling Shareholders section of the
prospectus. ("April 1999 Offering"). The April 1999 Offering was made pursuant
to the exemptions from registration provided by Section 4(2) of the Act, and
Rule 506 promulgated thereunder, and the applicable blue sky laws. We received
proceeds of $942,404 and issued 475,118 shares of common stock thereunder. The
April 1999 Offering closed in May 1999.
In April 1999, we issued warrants to purchase 5,200 shares of our common
stock to Comerica Bank, in exchange for extended repayment terms related to
liabilities we acquired in the acquisition of Zap International. The warrants
are exercisable at $5 per share, expire in April 2004, and were issued pursuant
to the exemptions from registration provided by Section 4(2) of the Act. At the
date of grant, the fair value of the warrants was $1,508.
In May 1999, we issued warrants to purchase 15,000 shares of our common
stock to Zachary Hanson, Jordan Hanson, and Clarke Hanson, as an inducement to
become an early customer. The warrants are exercisable at $11.25 per share,
expire in May 2001, and were issued pursuant to the exemptions from
registration provided by Section 4(2) of the Act. At the date of grant, the
fair value of the warrants was $25,950.
From April through July 1999, we issued 69,859 shares of our common stock to
Lockheed Martin Corporation, Four Winds Trading Corp. and eight individuals in
exchange for consulting and advisory services. The consultants include Adrian
Turcotte, Robert Petersen, Barry Gott, David Jackson, Jeff Olander, Ed Roberts,
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David Hodkinson and John McMains. The shares were issued pursuant to the
exemptions from registration provided by Section 4(2) of the Act. Compensation
expense of $294,068 was recognized upon issuance of the shares.
From April 1999 through September 1999, we issued warrants for the purchase
of 231,000 shares of our common stock to nine accredited investors in exchange
for financial consulting and advisory services. The warrants have prices
ranging from $1 to $10 per share, vesting terms based on achieving various
performance criteria and expire at various dates through July 2005. The
warrants were issued to Jeff Gold, Mark Rice, Irl Nathan, Laird Kagan, Jim
Kaplan, Eric Eisenberg, David Jackson, Kathy Rocklen and Richard Brown. The
warrants were issued pursuant to the exemptions from registration provided by
Section 4(2) of the Act. We recognize compensation expense based on the fair
value of the warrants as computed using the Black-Scholes option pricing model.
The Company has recognized compensation expense of $1,904,628 for these
warrants. As of December 18, 2000, 42,793 of these warrants had been forfeited.
In July 1999, we undertook a private placement of our Series B preferred
stock, at a price of $8 per share to 26 institutional and 161 individual
accredited investors, all of whom are included in the selling Shareholders
section of the prospectus. ("July 1999 Offering"). The July 1999 Offering was
made pursuant to the exemptions from registration provided by Section 4(2) of
the Act, and Rule 506 promulgated thereunder, and the applicable Blue Sky laws.
We received proceeds of $10,153,473 and issued 1,388,073 shares of Series B
preferred stock and 635,091 warrants thereunder. We also issued an option to
purchase an additional 125,000 shares of Series B preferred at $8.00 per share
and receive an additional 12,500 warrants, expiring March 31, 2000. The option
was exercised on March 24, 2000. The July 1999 Offering closed in December
1999.
From October 1999 through August 2000, we issued warrants for the purchase
of 1,136,000 shares of our common stock to 24 accredited investors in exchange
for financial consulting and advisory services. The warrants bear prices
ranging from $5.25 to $30 per share, have vesting terms of up to three years
and expire at various dates through August 2006. The warrants were issued to
Robert Keefe, Robert Smith, Jack Hazzard, Michael Levy, Ken Mullins, Robert
Fish, Anthony Cosentino, Netimpact, The Gingrich Group, Daniel Tellup, Ruffin
Cordell, Charles Preston, Pierre Stroh, Andrew Whitmark, John Ratzenberger,
Timothy McMullen, Kevin Temple, Peter Wilson, Kimberly Norton, Online Research
Partners, Dan Shapero, KSH Investment Group, Privet Row, Inc., and Highline
Capital Partners. The warrants were issued pursuant to the exemptions from
registration provided by Section 4(2) of the Act. We recognize compensation
expense based on the fair value of the warrants as computed using the
Black-Scholes option pricing model. The Company has recognized compensation
expense of $1,675,198 for these warrants. As of December 18, 2000, 96,667 of
these warrants had been forfeited.
In March 2000, we undertook a private placement of our Series C preferred
stock, at a price of $25 per share to 11 institutional and 6 individual
accredited investors ("March 2000 Offering"). The investors were Patricia
Quick, Highline Capital International, Highline Capital Partners LP, Thomas
Quick and Leslie Quick JT TEN, Lorenzo Bettino, Cahan Family Holdings LLC,
Point West Ventures, International Network Group, Gregory Shlopak, Privet
MindArrow Partners LP, Kevin & Ulla Parker JT WROS, Timothy McMullen, Gabelli
Global Growth Fund, Gabelli Mighty Mites Fund, PSINet Consulting Solutions
Holdings, Inc., United Investors Group, and AC-eCom Two LP. The March 2000
Offering was made pursuant to the exemptions from registration provided by
Section 4(2) of the Act, and Rule 506 promulgated thereunder, and the
applicable Blue Sky laws. We received proceeds of $18,144,375 and issued
725,775 shares of Series C preferred stock and 145,156 warrants thereunder. The
March 2000 offering closed in April 2000.
In April 2000, we issued 150,000 shares of our common stock in connection
with our acquisition of 90% of the outstanding common stock of Fusionactive.com
Limited, our Hong Kong-based subsidiary. The shares were issued to Arch
International Group Limited, Jamo Lo Ka Chue, Tracy Yau Yuet Ling, Intellectual
Partners Limited, Alex Lee Ping Kee and Xiao Feng Group Limited, who were the
shareholders of Fusionactive and all of whom are included in the selling
shareholders section of the prospectus. The shares were issued pursuant to the
exemptions from registration provided by Section 4(2) of the Act. The shares
were valued at $2,625,000 at the time of issuance.
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Item 16: Index To Exhibits and Financial Statement Schedules
<TABLE>
<CAPTION>
Exhibit No. Description
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<C> <S>
2.1* Agreement and Plan of Merger, dated as of March 31, 2000, between
MindArrow Systems, Inc. and eCommercial.com, Inc.
2.2* Stock Purchase Agreement--Fusionactive.com, Ltd.
3.1* Amended and Restated Certificate of Incorporation of the
Registrant
3.2* Bylaws of the Registrant
4.1* Investor Rights Agreement
4.2* Form of Registrant's Common Stock Certificate
4.3* Form of Registrant's Series B Preferred Stock Certificate
4.4* Form of Common Stock Warrant
5.1* Opinion on Legality
9.1* Voting Agreement
10.1* Stock Purchase Agreement, dated as of April 16, 1999, between the
Company and Shareholders of Zap International
10.2* Merger Agreement, dated as of April 19, 1999, between Wireless
Netcom, Inc. and the Shareholders of eCommercial.com, Inc.
10.3* Consulting Agreement--Thomas J. Blakeley
10.4* Employment Agreement--Robert I. Webber
10.5* Consulting Agreement--Eric A. McAfee
10.6* Form of Change in Control Executive Retention Agreement
10.7* Registrant's 1999 Stock Option Plan
10.8* Agreement between Registrant and Eric A. McAfee regarding Voxel
10.9* Form of Indemnification Agreement between Registrant and each of
its directors
10.10* Lease Agreement--Aliso Viejo, California
10.11* Sublease Agreement--Cupertino, California
10.12* Strategic Relationship Agreement between Registrant and Onex
Ventures LLC
10.13 Registrant's 2000 Stock Option Plan
23.1* Consent of Experts (Grant Thornton LLP)
23.2* Consent of Experts (Grant Thornton, Hong Kong)
23.3* Consent of Counsel (see Exhibit 5.1)
24.1* Power of Attorney
</TABLE>
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* Previously filed
Item 17: Undertakings
We hereby undertake to:
1. File, during any period in which we offer or sell securities, a post-
effective amendment to this Registration Statement to:
(a) Include any prospectus required by Section 10(a)(3) of the
Securities Act;
(b) Reflect in the prospectus any facts or events which, individually
or together, represent a fundamental change in the information set
forth in the Registration Statement; and
(c) Include any additional or changed material information on the plan
of distribution;
2. For determining liability under the Act, treat each post-effective
amendment as a new registration of the securities offered, and the
offering of such securities at that time to be the initial bona fide
offering; and
3. File a post effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.
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Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the company
pursuant to the foregoing provisions, or otherwise, the company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the company of expenses incurred or paid by a
director, officer or controlling person of the company 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 company 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.
For the purpose of determining any liability under the Securities Act, the
company will treat the information omitted from the form of prospectus filed as
part of this Registration Statement in reliance upon Rule 430A and contained in
a form of Prospectus filed by the Company pursuant to Rule 424(b)(1), or (4),
or 497(h) under the Securities Act as part of this Registration Statement as of
the time the Securities and Exchange Commission declares it effective.
For the purpose of determining any liability under the Securities Act, we
will treat such post-effective amendment that contains a form of prospectus as
a new Registration Statement for the securities offered therein, and treat the
offering of the securities at that time as the initial bona fide offering of
those securities.
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SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-1 and authorized this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Aliso Viejo, State of California, on January 8,
2001.
MindArrow Systems, Inc.
/s/ Robert I. Webber
By___________________________________
Robert I. Webber
Chief Executive Officer
IN WITNESS WHEREOF, each of the undersigned has exercised this power of
attorney as of the date indicated.
In accordance with 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 stated.
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Signature Title Date
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* Co-Chairman of the Board January 8, 2001
____________________________________
Thomas J. Blakeley
* Co-Chairman of the Board January 8, 2001
____________________________________
Eric A. McAfee
/s/ Robert I. Webber Chief Executive Officer, January 8, 2001
____________________________________ President, (Principal
Robert I. Webber Executive Officer), and
Director
* Director January 8, 2001
____________________________________
John Troiano
Director January , 2001
____________________________________
Joel Schoenfeld
Director January , 2001
____________________________________
Thomas C. Quick
/s/ Michael R. Friedl Chief Financial Officer, January 8, 2001
____________________________________ Treasurer (Principal
Michael R. Friedl Financial and Accounting
Officer)
*By: /s/ Michael R. Friedl
____________________________________
Michael R. Friedl
Attorney-in-fact
</TABLE>
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<TABLE>
<CAPTION>
Exhibit No. Description
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2.1* Agreement and Plan of Merger, dated as of March 31, 2000, between
MindArrow Systems, Inc. and eCommercial.com, Inc.
2.2* Stock Purchase Agreement--Fusionactive.com, Ltd.
3.1* Amended and Restated Certificate of Incorporation of the
Registrant
3.2* Bylaws of the Registrant
4.1* Investor Rights Agreement
4.2* Form of Registrant's Common Stock Certificate
4.3* Form of Registrant's Series B Preferred Stock Certificate
4.4* Form of Common Stock Warrant
5.1* Opinion on Legality
9.1* Voting Agreement
10.1* Stock Purchase Agreement, dated as of April 16, 1999, between the
Company and Shareholders of Zap International
10.2* Merger Agreement, dated as of April 19, 1999, between Wireless
Netcom, Inc. and the Shareholders of eCommercial.com, Inc.
10.3* Consulting Agreement--Thomas J. Blakeley
10.4* Employment Agreement--Robert I. Webber
10.5* Consulting Agreement--Eric A. McAfee
10.6* Form of Change in Control Executive Retention Agreement
10.7* Registrant's 1999 Stock Option Plan
10.8* Agreement between Registrant and Eric A. McAfee regarding Voxel
10.9* Form of Indemnification Agreement between Registrant and each of
its directors
10.10* Lease Agreement--Aliso Viejo, California
10.11* Sublease Agreement--Cupertino, California
10.12* Strategic Relationship Agreement between Registrant and ONEX
Ventures LLC
10.13 Registrant's 2000 Stock Option Plan
23.1* Consent of Experts (Grant Thornton LLP)
23.2* Consent of Experts (Grant Thornton, Hong Kong)
23.3* Consent of Counsel (see Exhibit 5.1)
24.1* Power of Attorney
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* Previously filed
