<PAGE> 1
As filed with the Securities and Exchange Commission on January 11, 2000
Registration No. 0-27929
==============================================================================
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB/A No. 1
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
Skreem.com Corporation
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(Name of Small Business Issuer in its Charter)
Delaware 62-1655508
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1110 Palmer Avenue, Winter Park, Florida 32790
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number: (407) 645-1704
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Securities to be registered under Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
N/A N/A
----- -----
Securities to be registered under Section 12(g) of the Act:
Common Stock, par value $0.01 per share
---------------------------------------
(Title of Class)
<PAGE>
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Skreem.com Corporation
FORM 10-SB
TABLE OF CONTENTS
PART I Page
Item 1. Description of Business ..................................... 3
Item 2. Management's Discussion and Analysis or Plan of Operation ... 7
Item 3. Description of Property...................................... 8
Item 4. Security Ownership of Certain Beneficial Owners
and Management.............................................. 8
Item 5. Directors, Executive Officers, Promoters
and Control Persons......................................... 9
Item 6. Executive Compensation....................................... 10
Item 7. Certain Relationships and Related Transactions............... 11
Item 8. Description of Securities.................................... 11
PART II
Item 1. Market Price of and Dividends on the Registrant's
Common Equity and Other Shareholder Matters................. 12
Item 2. Legal Proceedings............................................ 12
Item 3. Changes in and Disagreements with Accountants................ 12
Item 4. Recent Sales of Unregistered Securities...................... 12
Item 5. Indemnification of Directors and Officers.................... 13
PART F/S
Financial Statements......................................... 14
PART III
Item 1. Index to Exhibits............................................ 24
Signatures................................................... 25
<PAGE>
<PAGE> 3
PART I
Item 1. Description of Business
Corporate History
- -----------------
Skreem.com Corporation a Delaware corporation (the "Company")formerly
Commerce Centers Corporation was formed in May 1989 but did not have any
operations until it acquired Skreem.com Corporation a Nevada corporation
("Skreem") in March 1999. Upon the acquisition of Skreem, the Company changed
its name from Commerce Centers Corporation to "Skreem.com Corporation." The
Company acquired all of Skreem's issued and outstanding shares of common stock
making Skreem a wholly-owned subsidiary of the Company. The business of
Skreem has become the only operating business of the Company and the officers
and directors of Skreem have assumed the officers and director positions of
the Company. When used herein the term "Company" refers to the combined
entity unless the context otherwise indicate.
Skreem was formed in 1999 to develop and market computer and Internet
related software. In February 1999, Skreem acquired R&R Marketing Group, Inc.
which had the rights to a series of computer software known as Skreem System
Acceleration. The Skreem software attempts to accelerate the speed of a
computer in relation to various computer programs' operating abilities. The
initial concept was aimed at allowing individuals to purchase this software to
accelerate a computer's operating speed rather than having to purchase new
hardware to achieve increased operating speeds. The software was designed to
be flexible and work with any computer that is a 486DX or superior and runs
either the Windows 95 or 98 operating systems.
Skreem has only recently been formed and has not had the time or
financing to exploit its software. Previously, the efforts of R&R Marketing
Group, Inc., the prior owners of the software, were on the development of the
software and not on its commercialization. Accordingly, the future market
acceptability of the Skreem software is still unknown.
If the Company is successful in exploiting the Skreem software, the
Company intends to develop other computer and Internet related software and
potentially acquire other hi-tech, Internet or software business. In an
effort to fund the development and marketing of the "Skreem System
Acceleration," the Company raised over $900,000 through the sale of shares of
its common stock in a private placement. These funds will be used to complete
Beta versions of its products and commence marketing efforts.
Operations
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Products and Services
---------------------
The Company's first product is called Skreem System Acceleration, which
is a comprehensive software tool aimed at increasing operating speeds of
computers. The goal of the software is to accelerate the speed in which
computers perform their functions and decrease Internet download and upload
times. Additionally, the software attempts to stabilize Microsoft
Windows(tm), run graphics faster and makes it easier to navigate through
toolbars.
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The Company recently completed benchmark testing using WinTune98, an
industry-standard testing program. All tested variables showed marked
increases in performance. Skreem.com owns 100% of all rights to the
acceleration methodology as well as all pending trademarks.
Skreem System Acceleration has two versions: Skreem for Windows 95 and
Skreem for Windows 98. These main Skreem acceleration software products have
also been partitioned into several distinct products. The Skreem acceleration
tool has been divided into: Skreem Internet, Skreem Windows and Skreem
Graphics. These products are sold separately from the comprehensive Skreem
accelerator tool, providing consumers the ability to choose the specific
Skreem tool to fit their needs.
All of the Company's products and services will be available for
licensing and purchase on the Company's website. The Company anticipates
including extensive technical support options that will reduce the traditional
high cost of customer assistance. Initially the website will be the main
venue for purchasing the Company's products. In a marketing move, the site is
planned to have Java-based "cookies" (invisible applications that
automatically download and run on a user's computer) that will profile the
computer being used by the person viewing the website. The website will then
customize the viewable information to the visitor's computer settings. For
example, a "cookie" will automatically download to a visitor who is using a
486dx computer running Windows 95. That information about the visitor's
computer is sent back to the Company's site within seconds. From then on, the
visitor will see performance charts and graphs showing how the Company's
acceleration software will boost the visitor's specific computer
configuration. Sales efforts are hopefully made easier since potential
customers don't have to search around for details about the Company's products
for their specific computer.
The Company is working on providing web-based support resources that
provide front-line assistance for the Company's suite of applications. Four
types of self-help tools are planned:
Knowledge Base: Users can search a database for common solutions relating
to an issue.
Frequently Asked Questions: Users can review a list of answers to the
most frequent questions relating to Skreem.com software.
FTP download Library: Users can download patches, software updates,
drivers, technical articles, bug fixes and enhancements.
Tech Support Software: Users can quickly download the software used by
the Company for its direct real-time customer support option.
Second-Stage Products and Services
----------------------------------
The Company is developing products for the second phase of its evolution.
The second set of software products will expand the list of possible operating
systems with which the Skreem System Acceleration can operate including:
Skreem 2000, Skreem Windows NT and Skreem Networks. The Company intends to
updated its software with each new iteration of the Windows (tm) operating
system. The Company hopes to be able to eventually offer its Skreem software
products in multiple languages for international sale.
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As funding permits, the Company hopes to be able to develop a strong
software team that not only works on the Skreem products but also will be able
to develop software for licensing to other software firms. Some of the first
projects currently being considered for development for licensing to others
areas include a software installation system that protects against software
piracy, a data encryption system and a proprietary customer service technology
that allows online real-time repair of customers' computers. All future
development will be dependant on the Company's first product, Skreem System
Acceleration and potentially upon the Company's ability to generate further
investment capital for expansion.
Although the Company has developed its product and performed initial
test along with Beta runs, management feels the product is several months from
full commercialization. The Beta results appear promising; however, the
Company must still complete its downloading technology to allow purchasers to
access the software on the Company's web site. Until commercialization of the
product is commenced, there can be no assurance of future success.
Additionally, although Beta versions of the product do not show any operating
problems, upon large scale usage of the product, it would not be unusual for
certain "bugs" to be found which would require correction. This could slow
further developments of the software.
Marketing Strategy
------------------
The Company's short-term marketing strategy is to set up channel sales
through major distributors. The Company plans to promote its products and
brand names with the use of industry and consumer magazine advertising,
co-operative advertising campaigns with the dealers and distributors, as well
as an aggressive display and international trade show schedule.
Strategic alliances and licensing are a major plan of the Company's
long-term marketing strategy to enter new and existing markets making use of
established distribution and customer bases of the Company's partners and
licensees.
Competition and Markets
-----------------------
The Company faces many challenges and competitors to its software. The
competition comes not only from other software products but from computer
hardware manufactures that continue to make faster computers at cheaper
prices. Additionally, other software companies offer products to improve
computer functions. The Company's operation is very vulnerable to competition
because of the Company's financial capabilities and the newness of its
product. The Company's present size and financial capabilities creates a
situation where its competitors are larger, better financed and have better
name recognition than the Company placing the Company at a competitive
disadvantage.
Research and Development
------------------------
The Company's programming and product development has been performed by
two of the Company's officers in the past. The Company intends to hire three
or four new programmers to assist in product development and improvements on
current products. If the Company's current software proves successful, the
Company will accelerate the addition of new programmers to reduce the time
required to develop new software.
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Patents and Trademarks
----------------------
The Company has filed for trademark registration on the name "Skreem.com
System Acceleration," and is in the process of filing trademark registrations
on product names. The Company has been granted Internet registration of the
domain name "Skreem.com."
Government Regulation
---------------------
The Company is not subject to any government regulations other than those
that normally apply to other software manufacturers, such as copyright and
trademarks laws.
Year 2000 Computer Problem
--------------------------
Many currently installed computer systems and software programs are not
capable of correctly processing 21st century dates. As a result, computer
systems, software and other computer controlled processes used by many
companies in a very wide variety of applications could have experienced
operating difficulties unless they were modified or upgraded to adequately
process information involving, related to, or dependent upon the century
change. Significant uncertainty will continue to exist as to the long term
success in preparing computer systems for the 21st century dates.
The Company has not experienced any trouble with its computer systems and
is not aware of any trouble experienced from other companies it is currently
engage in business. The Company will continue to monitor this situation over
the next several months but does not anticipate any significant problems.
Employees
---------
The Company has three employees. (See "Directors and Executive
Officers.")
Offices
-------
The Company's principal executive offices are located at 1110 Palmer
Avenue, Winter Park, Florida 32790. These offices are provided, rent free, by
the Company's president, Thomas Tedrow. The Company believes that the above
facilities are adequate for the foreseeable needs of the Company; however,
eventually as the Company expands its employee base, it anticipates adding
additional office space.
<PAGE>
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Item 2. Management's Discussion and Analysis or Plan of Operation
Overview
- --------
The Company has developed and is completing beta test of a software based
system called "Skreem System Acceleration" which accelerates the operating
speed of Microsoft Windows(tm) based software programs. The Company has only
just begun limited marketing of its product. Previous efforts have been
focused on the development of the software and obtaining funds necessary to
produce and market the software. The Company has now raised over $900,000 to
commence manufacturing, marketing and product support activities. The Company
will be completely dependent on the success of the Skreem System Acceleration.
Plan of Operation
- -----------------
The Company intends to commence marketing and distribution of its Skreem
System Acceleration through various means. Initially, even with the funds
raised, the Company will have to focus on limited advertising to garner
interest in the Company's products. Advertising will be through the Company's
Internet site with "banners" from other sites to attract interest. Additional
advertising will be in computer magazines. The Company will also attempt to
place its product in computer stores and other software outlets. The Company
may have difficulty obtaining space on shelves do to its lack of a prior track
record or size.
The Company will use its funds principally to develop a support network
and for marketing its current product. Some funds will be used to hire
additional programmers to improve upon the Company's current products. The
Company does not anticipate it will be profitable in the current year and
foresees at least twelve months of losses as it commences marketing efforts
and hires additional support staff and programmers. If the Company is unable
to generate revenue from product sales within the next twelve months, the
Company would be forced to seek additional capital to continue in business.
Liquidity and Capital Resources
- -------------------------------
At the year end December 31, 1998, and the quarter ended March 31, 1999,
the Company essentially had no assets and was focused on the development of
its software program. The Company fortunately did not have extensive cash
drains as the officers of the Company were the developers of the software and
not taking large salaries. After the quarter ended March 31, 1999, the
Company was able to raise over $900,000 through the sale of shares of its
common stock in a private placement. At September 30, 1999, the Company had
$615,825 in cash to fund operations. The Company believes these funds are
sufficient to support the Company's operations for the next twelve months.
However, as the Company commences to bring its product to market the Company
anticipates the need to generate additional capital. Liabilities at September
30, 1999, were only $11,322.
The Company intends to use its capital to commence marketing operations
on its software, hire additional programmers and fund ongoing working capital
needs. The Company's future success will be dependent on the acceptance of
the "Skreem System Acceleration" software. If the software is not received
well by potential consumers, the Company's future success will be in question.
<PAGE> 8
The Company does not have any other products, at this time, and likely will
not have the capital to develop and market other potential software. Even if
the Company is successful in generating a market for its software, it is
likely that the Company will need additional capital to aggressively market
its software and to work on the development of additional software.
Management anticipates any future capital will be raised through the sale of
its securities which may dilute current shareholders.
Results of Operations
- ---------------------
The Company's prior operations were limited and principally aimed at the
development of its software. Since inception through September 30, 1999, the
Company had expenses of $288,027 related to the formation of the Company and
software development expenses. The Company anticipates expenses will increase
as it moves into the marketing phase of its product development. For the
three and nine months ended September 30, 1999, the Company had $77,324 and
$201,940, respectively in expenses reflecting the increase in personnel and
development cost related to beta test and initial marketing efforts. The
future success of the Company is still an unknown factor as the Company has
not had the time to engage in extensive marketing efforts and presently has no
sales.
Item 3. Description of Property
The Company's only property consist of office space provided by the
Company's president at no charge. The Company believes its present office
space is sufficient for the foreseeable future. Once the Company starts
generating revenue, the Company will consider moving to new office space. The
Company's other property consist of office and computer equipment.
Item 4. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth the number of shares of the Company's
Common Stock, par value $0.01, held by each person who is believed to be the
beneficial owner of 5% or more of the shares of the Company's common
stock outstanding at January 4, 2000, based on the Company's transfer agent's
list, representations and affidavits from shareholders and beneficial
shareholder lists provided by the Depository Trust and securities broker
dealers, and the names and number of shares held by each of the Company's
officers and directors and by all officers and directors as a group.
Title of Name and Address Amount and Nature of Percent
Class Of Beneficial Owner Beneficial Ownership of Class
- -------- ------------------- --------------------- --------
Principal Shareholders
- ----------------------
Common Thomas Tedrow
1110 Palmer Avenue
Winter Park, Florida
32790 7,867,000 58.2%
Common Jeff Martin (1)
179 Fairview Point Circle
Orlando, Florida
32790 581,962 4.3%
Common Forbes Investments (2)
Central Plaza, Suite 4703
18 Harbour Rd.
Wanchai, Hong Kong, PRC 400,012 2.96%
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Common FSC Limited (3)
Central Plaza, Suite 4703
18 Harbour Rd.
Wanchai, Hong Kong, PRC 400,012 2.96%
Officers, Directors and Nominees
- --------------------------------
Common Thomas Tedrow ---------See Above---------
Common Mike Reynolds 250,000 1.86%
Common Jacob Nguyen 100,000 0.74%
All Officers, Directors, and
Nominees as a Group (3 Person) 8,217,000 60.78%
- --------------------------------
(1) Mr. Martin owns 506,962 shares directly or through his business. Mr.
Martin's children own 75,000 shares.
(2) Mr. Martin has voting power over 400,012 shares held by Forbes
Investments.
(3) Mr. Martin has voting power over 400,012 shares held by FSC Limited.
Item 5. Directors, Executive Officers, Promoters and Control Persons
The names of the Company's executive officers and directors and the
positions held by them are set forth below:
Name Age Position Director Since
------ ---- -------- --------------
Thomas L. Tedrow 48 President & Chief Executive
Officer, Director 1999
Michael Reynolds 22 Vice-President of Product
Development, Director 1999
Jacob Nguyen 26 Treasurer & Secretary, Director 1999
The term of office of each director is one year and until his successor
is elected at the Company's annual shareholders' meeting and is qualified,
subject to removal by the shareholders. The term of office for each officer
is for one year and until a successor is elected at the annual meeting of the
board of directors and is qualified, subject to removal by the board of
directors.
Biographical Information
- ------------------------
Set forth below is certain biographical information with respect to each
of the Company's officers and directors.
Thomas L. Tedrow is the author of over twenty books. He is an
international marketing strategist who publishes Market Management Reports
and founded Financial Discoveries. He directs Tedrow Communications
Corporation, a marketing communication firm with offices in Orlando, Florida
and Hong Kong. Mr. Tedrow is a graduate of the University of Florida with a
degree in Public Relations/Journalism.
Michael Reynolds is the developer of the Skreem System Acceleration
product. Previously, he was the principal of R&R Marketing, a high-technology
marketing firm based in Missouri which was acquired by the Company. Mr.
Reynolds focuses on the development of various software.
Jacob Nguyen is the managing director of Market Management International,
Inc., an investment research firm. Mr. Nguyen heads a team of analysts and
<PAGE> 10
writers that researches companies from around the world. Previously, he was
vice president of Waterford Sterling, Inc., an international public relations
firm that created media campaigns and advertising for multinational
corporations. Mr. Nguyen has a bachelor's degree in International Economics.
Key Consultant
- --------------
Jeff Martin assisted the Company with its merger with Skreem.com
Corporation. And has been providing other business consultation. Mr. Martin
is the principal of Martin Consultants and has worked with Mr. Tedrow with
other corporations. Although not an officer or director of the Company, it is
anticipated Mr. Martin will have a voice in the direction of the Company
particularly given his relationship with Mr. Tedrow and other officers of the
Company. Mr. Martin is a shareholder of the Company.
ITEM 6. EXECUTIVE COMPENSATION
The following tables set forth certain summary information concerning the
compensation paid or accrued for the Company's last completed fiscal year to
the Company's or its principal subsidiaries chief executive officer and each
of its other executive officers that received compensation in excess of
$100,000 during such period (as determined at December 31, 1998, the end of
the Company's last completed fiscal year):
SUMMARY COMPENSATION TABLE
- --------------------------
<TABLE>
<CAPTION>
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
------------------- ------ --------
Other Restricted
Name and Annual Stock Options LTIP All other
Principal Position Year Salary Bonus($) Compensation Awards /SARs Payout Compensation
- ------------------ ---- ------ -------- ------------ ------ ------- ------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Thomas Tedrow(1) 1998 -0- -0- -0- -0- -0- -0- -0-
President and CEO
</TABLE>
(1)K.A. Emery was the president of the Company prior to its merger with
Skreem.com and subsequent name change. Ms. Emery did not receive a salary.
Mr. Tedrow was the President of Skreem.com Corporations prior to its merger
with the Company and did not receive a salary during this time. The Company
had no operations prior to its merger with Skreem.com Corporation which itself
had no operations in prior years
Options/SAR Grants in Last Fiscal Year
- --------------------------------------
The Company has never granted options or stock appreciation rights.
Bonuses and Deferred Compensation
- ---------------------------------
None.
Compensation Pursuant to Plans
- ------------------------------
The Company does not have any compensation or option plans.
Pension Table
- -------------
Not Applicable
<PAGE> 11
Other Compensation
- ------------------
None
Compensation of Directors
- -------------------------
Director's receive no compensation except for reimbursement for expenses
associated with attending a directors meeting.
Termination of Employment and Change of Control Arrangement
- -----------------------------------------------------------
There are presently nor are there anticipated any agreements regarding
change of control of the Company.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company completed the acquisition of Skreem.com Corporation, a Nevada
corporation in 1999. At the time of the acquisition, the Company was
controlled, in part, by Jeff Martin who has had a long term business
relationship with Tom Tedrow, the current president of the Company and the
president of the private Skreem.com Corporation at the time of the
acquisition. This relationship brings into question the arm's length nature
of the transaction. Management believes the terms of the merger were fair.
In August and September of 1999, the Company loaned an aggregate of
$100,000 to Union Online Organized Internet Services, Inc. ("Union"). These
loans are secured by 400,000 shares of Union's stock. The notes bear interest
at eight percent and are payable on demand. The Company received as
consideration for entering into these loans 100,000 shares of Union. Union
has no trading market for its securities. Mr. Tedrow, the president of the
Company and Mr. Martin a consultant to the Company are shareholders of Union.
In August 1999, the Company loaned to Skreem Entertainment Corporation, a
Nevada corporation controlled by Thomas Tedrow, the president of the Company,
$53,658.30. The note is payable on demand and bears interest at 10%.
Item 8. Description of Securities
Description of Securities
- -------------------------
General
-------
The Company is authorized to issue 30,000,000 shares of capital stock,
par value $0.01 per share designated as Common Stock. There are 13,520,315
fully paid and non assessable shares of Common Stock currently issued and
outstanding as of January 4, 2000.
Common Stock
------------
The holders of Common Stock are entitled to one vote per share on each
matter submitted to a vote at any meeting of shareholders. Shares of Common
Stock do not carry cumulative voting rights and, therefore, a majority of the
shares of outstanding Common Stock will be able to elect the entire board of
directors and, if they do so, minority shareholders would not be able to elect
any persons to the board of directors. The Company's bylaws provide that a
majority of the issued and outstanding shares of the Company constitutes a
quorum for shareholders' meetings, except with respect to certain matters for
which a greater percentage quorum is required by statute or the bylaws.
<PAGE>
<PAGE> 12
Shareholders of the Company have no preemptive rights to acquire
additional shares of Common Stock or other securities. The Common Stock is
not subject to redemption and carries no subscription or conversion rights.
In the event of liquidation of the Company, the shares of Common Stock are
entitled to share equally in corporate assets after satisfaction of all
liabilities.
Holders of Common Stock are entitled to receive such dividends as the
board of directors may from time to time declare out of funds legally
available for the payment of dividends. The Company seeks growth and
expansion of its business through the reinvestment of profits, if any, and
does not anticipate that it will pay dividends in the foreseeable future
PART II
Item 1. Market Price of and Dividends on the Registrant's
Common Equity and Other Shareholder Matters
The Company's Common Stock is currently not quoted or listed for trading
with any exchange or market.
Since its inception, the Company has not paid any dividends on its Common
Stock, and the Company does not anticipate that it will pay dividends in the
foreseeable future.
As of October 15, 1999, the Company had 13,520,315 shares of its Common
Stock issued and outstanding held by approximately 178 shareholders.
Item 2. Legal Proceedings
The Company is not, and has not been, involved in any legal proceedings.
Item 3. Changes in and Disagreements with Accountants
The Company has not changed, nor had any disagreements with, its
independent certified accountants.
Item 4. Recent Sales of Unregistered Securities
In April 1999, the Company engaged in the acquisition of Skreem.com
Corporation, a Nevada corporation, through the exchange of shares of the
Company's common stock for all of the issued and outstanding shares of common
stock of Skreem. The Company relied on exemptions from the registration
provisions of the Securities Act of 1933, as amended (the "Securities Act")
for the issuance of the shares. There were four shareholders of Skreem at the
time of the acquisition. All shares issued to the Skreem shareholders are
considered "restricted securities" by the Company.
In April and May of 1999, the Company completed the sale of 1,000,000
shares of its common stock raising $1,000,000 in a private placement conducted
under Rule 504 of Regulation D promulgated under the Securities Act of 1933,
as amended (the "Securities Act"). The Company filed a form D with the SEC
and made the appropriate New York state filings. All shares of stock issued
were deemed to be "restricted securities" as that term is defined in the
Securities Act and the share certificates have been marked indicating the
shares are "restricted."
<PAGE>
<PAGE> 13
Item 5. Indemnification of Directors and Officers
Section 145 of the Delaware Corporation Law provides in relevant parts as
follows:
(1) A corporation shall have power to indemnify any person who was or is
a party or is threatened to be made a party to any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative (other than an action by or in the right of
the corporation) by reason of the fact that he is or was a director, officer,
employee, or agent of the corporation, or is or was serving at the request of
the corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other enterprise, 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 he acted in good faith and in a manner he
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. The termination of any
action, suit, or proceeding by judgment, order, settlement, conviction, or on
a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
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
reasonable cause to believe that his conduct was unlawful.
(2) A corporation shall have power to indemnify any person who was or is
a party or is threatened to be made a party to any threatened, pending, or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the feet that he is or was a director,
officer, employee, or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee, or agent of
another corporation, partnership, joint venture, trust, or other enterprise
against expenses (including attorneys' fees) actually and reasonably incurred
by him in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue, or matter as to
which such person shall have been adjudged to be liable for negligence or
misconduct in the performance of his duty to the corporation unless and only
to the extent that the court in which such action or suit was brought shall
determine on application that, despite the adjudication of liability but in
view of all circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which such court shall deem proper.
(3) To the extent that a director, officer, employee, or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit, or proceeding referred to in 1) or (2) of this subsection, or in
defense of any claim, issue or matter therein, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him
in connection therewith.
(4) The indemnification provided by this section shall not be deemed
exclusive of any other rights to which those seeking indemnification may be
entitled under any bylaws, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, and shall continue as to
a person who has ceased to be a director, officer, employee, or agent and
shall inure to the benefit of the heirs, executors, and administrators of such
a person.
<PAGE> 14
The foregoing discussion of indemnification merely summarizes certain
aspects of indemnification provisions and is limited by reference to the above
discussed sections of the Delaware Corporation Law.
The Registrant's certificate of incorporation and bylaws provide that the
Registrant "may indemnify" to the full extent of its power to do so, all
directors, officers, employees, and/or agents. It is anticipated that the
Registrant will indemnify its officers and directors to the full extent
permitted by the above-quoted statute.
Insofar as indemnification by the Registrant for liabilities arising
under the Securities Act may be permitted to officers and directors of the
Registrant pursuant to the foregoing provisions or otherwise, the Registrant
is aware 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.
PART F/S
--------
Financial Statements and Supplementary Data:
- -------------------------------------------
Financial Statements for June 30, 1999 and for December 31, 1998, and 1997:
Page No.
_ Independent Auditors' Report 15
_ Balance Sheets, June 30, 1999 and 1998 16
_ Statements of Operations for the year ended June 30,
1999, and from May 17, 1989 (inception) to June 30, 1999 17
_ Statement of Stockholders' Equity, from inception on
May 17,1989 through June 30, 1999 18
_ Statements of Cash Flows for the year ended June 30, 1998,
and from inception on May 17, 1989 through June 30, 1999 19
- Notes to Financial Statements 20
Financial Statements (unaudited) for September 30, 1999:
- Compilation Report 23
- Balance Sheets, September 30, 1999 and December 31, 1998 24
_ Statements of Operations for the three and nine Months
ended September 30, 1999, and 1998 and from May 17, 1989
(inception) to June 30, 1999 25
- Statements of Cash Flows for the for the nine months ended
September 30, 1999 and 1998 and from inception on May 17,1989
through September 30, 1999 26
- Notes to Financial Statements 27
<PAGE>
<PAGE> 15
ANDERSEN, ANDERSEN & STRONG, L.C.
Certified Public Accounts and Business Consultants
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
Skreem.com Corporation
Salt Lake City, Utah
We have audited the balance sheets of Skreem.com Corporation (a development
stage company) at June 30, 1999, December 31, 1998, and December 31, 1997 and
the related statements of operations, stockholders' equity, and cash flows for
the six months ended June 30, 1999 and the years ended December 31, 1998, 1997
and the period from inception (May 17, 1989) to June 30, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinions.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Skreem.com Corporation at
June 30, 1999, December 31, 1998 and December 31, 1997, and the results of its
operations and cash flows for the six months ended June 30, 1999 and the years
ended December 31, 1998, 1997 and the period from inception (May 17, 1989) to
June 30, 1999 in conformity with generally accepted accounting principles.
/S/ ANDERSEN ANDERSEN & STRONG, L.C.
Salt Lake City, Utah
September 29, 1999
<PAGE>
<PAGE> 16
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
BALANCE SHEETS
June 30, 1999 and December 31, 1998
June 30, Dec. 31,
1999 1998
----------- -----------
ASSETS
CURRENT ASSETS:
Cash $ 794,060 $ -
----------- -----------
Total current assets 794,060 -
EQUIPMENT:
Office equipment 10,998 -
Accumulated depreciation ( 716) -
----------- -----------
10,282 -
OTHER ASSETS:
Organization costs net of amortization 858 -
----------- -----------
$ 805,200 $ -
=========== ===========
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES:
Accrued expenses and payroll liabilities $ 15,277 $ -
----------- -----------
Total current liabilities 15,277 -
STOCKHOLDERS EQUITY:
Common stock, par value $.01;
authorized 30,000,000 shares; issued and
outstanding 13,420,315 and 2,920,200 134,203 29,202
Capital in excess of par value 861,561 62,218
Receivable on shares issued - (4,500)
Deficit accumulated during the
development state (205,841) (86,920)
----------- -----------
Total stockholders' equity 805,200 -
----------- -----------
$ 805,200 $ -
=========== ===========
See accompanying notes to financial statements
<PAGE>
<PAGE> 17
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
Statements of Operations
Six Months Ended June 30, 1999, and the Years
Ended December 31, 1998 and 1997
And Inception (May 17, 1989) Through June 30, 1999
<TABLE>
<CAPTION>
Inception
Through
June 30, Dec. 31, Dec.31, June 30,
1999 1998 1997 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUE
Interest income $ 5,697 $ - $ - $ -
---------- ----------- ----------- ----------
EXPENSES:
General and administrative 123,824 8,470 13,450 210,744
Depreciation and amortization 794 - - 794
---------- ---------- ---------- ----------
Total expenses 124,618 8,470 13,450 211,538
---------- ---------- ---------- ----------
NET LOSS $ (118,921) $ (8,470) $ (13,450) $ (205,841)
========== ========== ========== ==========
Net loss per common share
Basic $ (.01) $ (.01) $ (.01) $ -
=========== ========== ========== ==========
Wieghted average shares outstanding
Basic 8,048,376 1,363,029 1,335,000 -
=========== ========== =========== ==========
</TABLE>
See accompanying notes to financial statements
<PAGE>
<PAGE> 18
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
Statement of Stockholders' Equity (Deficit)
Period From Date of Inception (May 17, 1989) Through June 30, 1999
<TABLE>
<CAPTION>
Common Common Capitol In Receivable
Stock Stock Excess of On Shares Accumulated
Shares Amount Par Value Issued (Deficit) Total
----------- ----------- ----------- ----------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
Issuance of shares of common
stock on May 17, 1989 for
professional services rendered
at $.02 1,200,057 $ 12,001 $ 7,999 - $ - $ 20,000
Accumulated deficit - period May
17, 1989 to December 31, 1995 - - - - ( 20,000) ( 20,000)
Issuance of shares of common
stock during 1996 for cash
at $.33 30,000 300 9,700 - - 10,000
Issuance of shares of common
stock during 1996 for professional
services rendered at $.33 105,000 1,050 33,950 - - 35,000
Net loss year ended December 31,
1996 - - - - ( 45,000) ( 45,000)
Net loss year ended December 31,
1997 - - - - ( 13,450) ( 13,450)
----------- ----------- ----------- ----------- ----------- -----------
Balance December 31, 1997 1,335,057 13,351 51,649 - ( 78,450) ( 13,450)
----------- ------------ ----------- ----------- ----------- -----------
Issuance of shares of common
stock during 1998 in settlement
of accrued liabilities for
professional services at $.02 1,315,258 13,152 8,768 - - 21,920
Issuance of shares of common
stock during 1998 for a
commitment to provide future
capital at $.02 270,000 2,700 1,800 ( 4,500) - -
Net loss year ended December 31,
1998 - - - - ( 8,470) ( 8,470)
----------- ----------- ----------- ----------- ----------- -----------
Balance December 31, 1998 2,920,315 $ 29,203 62,217 $( 4,500) $( 86,920) $ -
----------- ----------- ----------- ----------- ----------- -----------
Issuance of shares of common
stock during 1999 to acquire
wholly owned subsidiary at $.00 9,600,000 96,000 ( 86,000) - - 10,000
Issuance of common stock during
1999 for cash at $.99 900,000 9,000 885,344 - - 894,344
Commitment to provide future
capital satisfied - - - 4,500 - 4,500
Net loss for six months ended
June 30, 1999 - - - - ( 118,921) ( 118,921)
----------- ----------- ----------- ----------- ----------- -----------
Balance June 30, 1999 13,420,315 134,203 861,561 $ $( 205,841) $ 789,923)
=========== ============ ============ ============= ============= =============
</TABLE>
See accompanying notes to financial statements
<PAGE>
<PAGE> 19
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
Statements of Cash Flows
Six Months Ended June 30, 1999, and the Years
Ended December 31, 1998 and 1997
And Inception (May 17, 1989) Through June 30, 1999
<TABLE>
<CAPTION>
Inception
Through
June 30, Dec. 31, Dec. 31, June 30,
1999 1999 1999 1999
----------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (118,921) $ ( 8,470) $ (13,450) $ (205,841)
Adjustment to reconcile net loss to
net cash used by operating activities:
Depreciation and amortization 741 - - 794
Increase (decrease) in accounts payable-accrued expenses 15,277 (13,450) 13,450 15,277
Expenses paid with common 9,500 21,920 - 86,420
----------- ----------- ---------- -----------
Net cash (used) by operations ( 93,350) - - (103,350)
----------- ----------- ---------- -----------
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of equipment ( 10,998) - - ( 10,998)
Increase in organization ( 936) - - ( 936)
----------- ----------- ---------- -----------
( 11,934) - - ( 11,934)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common
stock for cash 899,344 - - 909,344
----------- ----------- ---------- -----------
Net cash provided from financing activities 899,344 - - 909,344
NET INCREASE IN CASH 794,060 - - 794,060
Cash, beginning - - - -
----------- ----------- ----------- -----------
Cash, ending $ 794,060 - $ - $ 794,060
=========== =========== =========== ===========
SUPPLEMENTAL DISCLOSURES:
Non cash financing activities:
Issuance of common stock for expenses $ 9,500 $ 21,920 $ - $ 86,420
=========== ========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
<PAGE> 20
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
At June 30, 1999, December 31, 1998 and 1997
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY
Business activity
- -----------------
The Company, a Delaware corporation was incorporated on May 17, 1989, and is
currently in the development stage. The Company intends to acquire and
develop high technology software firms.
In April 1999 the Company changed its name from Commerce Centers Corporation
to Skreem.com Corporation and approved a reverse stock split of 3 shares of
outstanding stock for 5 shares. The report has been prepared as if the stock
split had occurred at inception.
Accounting method
- -----------------
The Company's financial statements are prepared using the accrual method of
accounting.
Principles of consolidation
- ---------------------------
The consolidated financial statements include the accounts of Skreem.com
Corporation, a Nevada corporation. All material intercompany transactions
have been eliminated.
Computer software costs
- -----------------------
The Company expenses research and development costs related to software
development that has not reached technological feasibility and started
production for sale. Thereafter costs are capitalized and amortized over a
maximum of five years or expected life of the product, whichever is less.
Computer research and development costs of $16,959 were incurred in the
current period ended June 30, 1999.
Income (loss) per share
- -----------------------
The computation of income (loss) per share of common stock is based on the
weighted average number of shares outstanding, after the stock split.
Statement of cash flows
- -----------------------
The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents for purposes of the
statement of cash flows.
<PAGE>
<PAGE> 21
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENT
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY
(continued)
Financial instruments
- ---------------------
The Company estimates that the fair value of all financial instruments at June
30, 1999, December 31, 1998 and 1997 does not differ materially from the
aggregate carrying values of its financial instruments recorded in the
accompanying balance sheets.
Dividend policy
- ---------------
The Company has not yet adopted a policy regarding payment of dividends.
Estimates and assumptions
- -------------------------
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
2. INCOME TAXES
The Company complies with Statement of Financial Accounting Standards No. 109,
Accounting for Income Taxes. At June 30, 1999 the Company had a net operating
loss ("NOL") carry forward for United States income tax purposes of
approximately $205,841. The NOL carryforward expires in increments beginning
in 2004. The Company's ability to utilize its net NOL carryforward is subject
to the realization of taxable income in future years, and under certain
circumstances, the Tax Reform Act of 1986 restricts a corporation's use of its
NOL carryforward. The Company believes that there is at least a 50% chance
that the carryforward will expire unused, therefore, any tax benefit from the
loss carryforward has been fully offset by a valuation reserve.
3. ACQUISITION OF NEVADA SKREEM.COM CORPORATION
In April 1999 the Company, Skreem.com Corporation, a Delaware corporation
("SCD") acquired all of the outstanding stock of Skreem.com Corporation, a
Nevada corporation ("SCN") through a stock for stock exchange in which the
stockholders of SCN received 9,600,000 post stock split common shares of the
SCD in exchange for all of the stock of the SCN. Skreem.com Corporation
("SCN") was incorporated in Nevada on January 29, 1999 for the purpose of
developing high technology software. For reporting purposes, the acquisition
is treated as an acquisition of the Company ("SCD") by Skreem.com Corporation
of Nevada ("SCN") (reverse acquisition) and a recapitalization of SCN
with its historical financial statements being combined with the Company's.
No proforma statements have been included since the acquisition is considered
to be a reverse acquisition.
<PAGE> 22
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO FIANANCIAL STATEMENTS (continued)
4. "Y2K"
Many computer programs have been written using two digits rather than four to
identify the year. Any computer programs that have date-sensitive software
may recognize a date using "00" as the year 1900 rather than the year 2000.
This could result in a system failure or miscalculations causing disruptions
of operations, including, among other things, a temporary inability to process
transactions, send invoices, or engage in similar normal business activities.
This situation is commonly referred as "Y2K". The Company's computer
equipment and software are year 2000 compliant.
5. RELATED PARTY TRANSACTIONS
During February 1998, the Company issued 1,585,258 post stock split shares to
five major stockholders and two persons who were both officers and directors.
The consideration for the issuance was assumption of the Company's accrued
liabilities in the amount of $21,920 by the above mentioned shareholders, and
the agreement by them to fund future Company expenditures in the amount of
$4,500.
The shares issued pursuant to the acquisition agreement as described in note 3
were issued to four individuals who collectively represent a controlling
interest of the Company.
<PAGE>
<PAGE> 23
ANDERSEN, ANDERSEN & STRONG, L.C.
Certified Public Accounts and Business Consultants
Board of Directors
Skreem.com Corporation
Salt Lake City, Utah
We have compiled the accompanying consolidated balance sheet of Skreem.com
Corporation as of September 30, 1999 and the related consolidated statements
of operations for the three months and nine months ended September 30, 1999
and 1998 and from inception ( May 17, 1989) through September 30, 1999. We
have also compiled the related consolidated cash flow statements for nine
months ended September 30, 1999 and 1998 and from inception (May 17, 1989)
through September 39, 1999. The compilations are in accordance with
Statements on Standards for Accounting and Review Services issued by the
American Institute of Certified Public Accountants.
A compilation is limited to presenting in the form of financial statements
information that is the representation of management. We have not audited or
reviewed the accompanying financial statements and, accordingly, do not
express an opinion or any other form of assurance on them.
The consolidated balance sheet of Skreem.com Corporation as of December 31,
1998 was audited by us previously in a report dated February 4, 1999 which
expressed an unqualified opinion.
Salt Lake City, Utah
December 10, 1999
<PAGE>
<PAGE> 24
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
BALANCE SHEETS
Unaudited September 30, 1999 and Audited December 31, 1998
Sept. 30, Dec. 31,
1999 1998
--------- ----------
ASSETS
CURRENT ASSETS:
Cash $ 615,825 $ -
Demand notes receivable (note 5) 155,050 -
Marketable securities 50,000 -
---------- ----------
Total current assets 820,875 -
EQUIPMENT:
Office equipment 13,380 -
Accumulated depreciation ( 2,007) -
---------- ----------
11,373 -
OTHER ASSETS:
Organization costs net of amortization 811 -
---------- ----------
$ 833,059 $ -
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 11,322 $ -
---------- ----------
Total current liabilities 11,322 -
STOCKHOLDERS EQUITY:
Common stock, par value $.01;
authorized 30,000,000 shares; issued and
outstanding 13,520,315 and 2,920,200 135,203 29,202
Capital in excess of par value 960,561 62,218
Receivable on shares issued - ( 4,500)
Deficit accumulated during the
development stage (274,027) ( 86,920)
---------- ----------
Total stockholders' equity 821,737 -
---------- ----------
$ 833,059 $ -
========== ==========
See accompanying notes and accountants' compilation report
<PAGE>
<PAGE> 25
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
Unaudited Statements of Operations
Three Months Ended September 30, 1999 and 1998
Nine Months Ended September 30, 1999 and 1998
And Inception (May 17, 1989) Through September 30, 1999
<TABLE>
<CAPTION>
Inception
Three Three Nine Nine Through
Months Months Months Months September 30,
1999 1998 1999 1998 1999
<S> ---------- ---------- ---------- ---------- --------------
<C> <C> <C> <C> <C>
REVENUE
Interest income $ 9,137 $ - $ 14,833 $ - $ 14,833
---------- ---------- ---------- ---------- ----------
EXPENSES:
General and administrative 75,986 2,118 199,808 6,353 286,728
Depreciation and amortization 1,338 - 2,132 - 2,132
---------- ---------- ---------- ---------- ----------
Total 77,324 2,118 201,940 6,353 288,860
---------- ---------- ---------- ---------- ----------
Net Loss per common share $( 68,187) $( 2,118) $( 187,107) $( 6,353) $( 274,027)
========== ========== ========== ========== ==========
Basic $( .01) $ - $( .02) $ -
========== ========== ========== ==========
Weighted average shares outstanding
Basic 13,520,000 1,335,057 9,856,464 1,335,057
========== ========== ========== ==========
</TABLE>
See accompanying notes and accountants' compilation report
<PAGE>
<PAGE> 26
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
Unaudited Statements of Cash Flows
Nine Months Ended June 30, 1999 and 1998
And Inception (May 17, 1989) Through September 30, 1999
Inception
Nine Nine Through
Months Months Sept. 30,
1999 1998 1999
------ ------ ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(187,107) $( 6,353) $( 274,027)
Adjustment to reconcile net loss to
net cash used by operating activities:
Depreciation and amortization 2,132 - 2,132
Increase (decrease)in accounts payable 11,322 6,353 11,322
Expenses paid with common stock 9,500 - 86,420
--------- --------- -----------
Net cash (used) by operations (164,153) - ( 174,153)
--------- --------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Issuance of notes receivable (155,050) - ( 155,050)
Purchase of marketable securities ( 50,000) - ( 50,000)
Purchase of equipment ( 13,380) - ( 13,380)
Increase in organization costs ( 936) - ( 936)
--------- --------- ---------
Net cash (used) by investing activities (219,366) - ( 219,366)
--------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common
stock for cash 999,344 - 1,009,344
Net cash provided from financing --------- --------- ---------
activities 999,344 - 1,009,344
--------- --------- ---------
NET INCREASE IN CASH 615,825 - 615,825
--------- --------- ---------
Cash, beginning - - -
--------- --------- ---------
Cash, ending $ 615,825 $ - $ 615,825
========= ========= =========
SUPPLEMENTAL DISCLOSURES:
Non cash financing activities:
Issuance of common stock for expenses $ 9,500 $ - $ 86,420
========= ========== =========
See accompanying notes and accountants' compilation report
<PAGE>
<PAGE> 27
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS ACTIVITY
Business activity
- -----------------
The Company, a Delaware corporation was incorporated on May 17, 1989, and is
currently in the development stage. The Company intends to acquire and
develop high technology software firms.
In April 1999 the Company changed its name from Commerce Centers Corporation
to Skreem.com Corporation and approved a reverse stock split of 3 shares of
outstanding stock for 5 shares. The report has been prepared as if the stock
split had occurred at inception.
Accounting method
- -----------------
The Company's financial statements are prepared using the accrual method of
accounting.
Principles of consolidation
- ---------------------------
The consolidated financial statements include the accounts of Skreem.com
Corporation, a Nevada corporation. All material intercompany transactions
have been eliminated.
Computer software costs
- -----------------------
The Company expenses research and development costs related to software
development that has not reached technological feasibility and started
production for sale. Thereafter costs are capitalized and amortized over a
maximum of five years or expected life of the product, whichever is less.
Computer research and development costs of $16,959 were incurred in the
current period ended June 30, 1999.
Income (loss) per share
- -----------------------
The computation of income (loss) per share of common stock is based on the
weighted average number of shares outstanding, after the stock split.
Statement of cash flows
- -----------------------
The Company considers all highly liquid debt instruments purchased with a
maturity of three months or less to be cash equivalents for purposes of the
statement of cash flows.
<PAGE>
<PAGE> 28
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND BUSINESS
ACTIVITY(continued)
Financial instruments
- ---------------------
The Company estimates that the fair value of all financial instruments at
September 30, 1999 and December 31, 1998 do not differ materially from the
aggregate carrying values of its financial instruments recorded in the
accompanying balance sheets.
Dividend policy
- ---------------
The Company has not yet adopted a policy regarding payment of dividends.
Estimates and assumptions
- -------------------------
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
2. INCOME TAXES
- ----------------
The Company complies with Statement of Financial Accounting Standards No. 109,
Accounting for Income Taxes. At September 30, 1999 the Company had a net
operating loss ("NOL") carry forward for United States income tax purposes of
approximately $274,027. The NOL carryforward expires in increments beginning
in 2004. The Company's ability to utilize its net NOL carryforward is subject
to the realization of taxable income in future years, and under certain
circumstances, the Tax Reform Act of 1986 restricts a corporation's use of its
NOL carryforward. The Company believes that there is at least a 50% chance
that the carryforward will expire unused, therefore, any tax benefit from the
loss carryforward has been fully offset by a valuation reserve.
3. ACQUISITION OF NEVADA SKREEM.COM CORPORATION
- -------------------------------------------------
In April 1999 the Company, Skreem.com Corporation, a Delaware corporation
("SCD") acquired all of the outstanding stock of Skreem.com Corporation, a
Nevada corporation ("SCN") through a stock for stock exchange in which the
stockholders of SCN received 9,600,000 post stock split common shares of the
SCD in exchange for all of the stock of the SCN. Skreem.com Corporation
("SCN") was incorporated in Nevada on January 29, 1999 for the purpose of
developing high technology software. For reporting purposes, the acquisition
is treated as an acquisition of the Company ("SCD") by Skreem.com Corporation
of Nevada ("SCN") (reverse acquisition) and a recapitalization of SCN
with its historical financial statements being combined with the Company's.
No proforma statements have been included since the acquisition is considered
to be a reverse acquisition.
<PAGE> 29
SKREEM.COM CORPORATION AND SUBSIDIARY
(A Development Stage Company)
NOTES TO FIANANCIAL STATEMENTS (continued)
4. "Y2K"
Many computer programs have been written using two digits rather than four to
identify the year. Any computer programs that have date-sensitive software
may recognize a date using "00" as the year 1900 rather than the year 2000.
This could result in a system failure or miscalculations causing disruptions
of operations, including, among other things, a temporary inability to process
transactions, send invoices, or engage in similar normal business activities.
This situation is commonly referred as "Y2K". The Company's computer
equipment and software are year 2000 compliant.
5. DEMAND NOTES RECEIVABLE
As of September 30, 1999, the Company had demand notes receivable, including
accrued interest as follows:
Maker Interest rate Amount
----- ------------- ------
Organized Internet Services, Inc. 8% $50,142
Organized Internet Services, Inc. 8% 50,646
Skreem Entertainment Corp. 10% 54,261
--------
$155,050
========
The notes due from Organized Internet Services, Inc. are each to be secured
with 200,000 shares of common stock of the maker, however, delivery of the
security had not been made as of September 30, 1999. The note due from Skreem
Entertainment Corp. is secured by recording equipment.
6. RELATED PARTY TRANSACTIONS
During February 1998, the Company issued 1,585,258 post stock split shares to
five major stockholders and two persons who were both officers and directors.
The consideration for the issuance was assumption of the Company's accrued
liabilities in the amount of $21,920 by the above mentioned shareholders, and
the agreement by them to fund future Company expenditures in the amount of
$4,500.
The shares issued pursuant to the acquisition agreement as described in note 3
were issued to four individuals who collectively represent a controlling
interest of the Company. The demand notes receivable as detailed in note 5
above were created in related party transactions since the Company's President
is a major shareholder in both Organized Internet Services, Inc. and Skreem
Entertainment Corp.
<PAGE>
<PAGE> 30
PART III
--------
ITEM 1. INDEX TO EXHIBITS
- -------------------------
Copies of the following documents are included as exhibits to this Form
10-SB pursuant to item 601 of regulation S-B.
SEC
Exhibit Reference
No. No. Title of Document
- ------- --------- -----------------
2 2.01 Plan and Agreement of Reorganization by and between
Commerce Centers Corporation and Skreem.com Corporation*
3(i) 3.01 Articles of Incorporation of the Company and related
Amendments*
3(i) 3.02 Article IV of the Articles of Incorporation*
3(ii) 3.03 Bylaws of the Company*
4 4.01 Specimen Stock Certificate*
10 10.01 Promissory Notes with
(a) Union Online Dated August 2, 1999
(b) Union Online Dated September 17, 1999
(c) Skreem Entertainment Corporation Dated August 20, 1999
27 27 Financial Data Schedule
* Previous filing
<PAGE>
<PAGE> 31
SIGNATURES
------------
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by
the undersigned, thereunder duly authorized.
SKREEM.COM CORPORATION
/S/ Signature
- -----------------------------
By: Thomas Tedrow, President
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this registration statement to be signed on its behalf by
the undersigned in the capacities and on the dates stated.
Signature Title Date
- --------- ----- ----
/s/ signature
- ---------------
Thomas Tedrow President, Director January 10, 2000
/s/ signature
- ---------------
Mike Reynolds Director January 10, 2000
/s/ signature
- ---------------
Jacob Nguyen Treasurer, Secretary,
Chief Financial Officer
Director January 10, 2000
<PAGE> 1
Exhibit 10.01 Promissory Notes
SKREEM.COM CORPORATION
SECURED PROMISSORY NOTE
Interest At 8%
Winter Park, Florida
August 2, 1999
Union Online (Organized Internet Services, Inc.) Promises to pay to the order
of Skreem.com Corporation in Winter Park, Florida, or at such other place as
holder hereof may designate in writing, the sum of Fifty Thousand and 00/100
($50,000), payable upon demand by Skreem.com Corporation.
Fifty Thousand Dollars ($50,000) will be wired to Union Online (Organized
Internet Services, Inc.) Within 24 hours after receipt of the signed note. If
the wire confirmation is not received in 24 hours, this note will be null and
void.
This note is secured by 200,00 shares of common stock. Skreem.com
Corporation, shall receive 50,000 share of restricted common stock of Union
Online as further compensation.
/s/ Signature 10/11/99
_____________ ________
Jacques Loveal, President Date
/s/ Signature 10/13/99
_____________ ________
Witness Date
/s/ Signature August 2, 1999
- ------------- --------------
Thomas L. Tedrow, President
Skreem.com Corporation
Instructions:
Fax copy of the signed note to: (407) 645-1704
Return Original by Fedex to: 1110 Palmer Ave., Winter Park, FL 32789
<PAGE> 2
SKREEM.COM CORPORATION
SECURED PROMISSORY NOTE
Interest At 10%
Winter Park, Florida
August 20, 1999
Skreem Entertainment Corporation, a Nevada Corporation, promises to pay to the
order of Skreem.com Corporation in Winter Park, Florida, or at such other
place as holder hereof may designate in writing. The sum of Fifty Three
Thousand Six Hundred Fifty Eight Dollars and 30/100 ($53,658.30), payable upon
demand by Skreem.com Corporation.
Fifty Three Thousand Six Hundred Fifty Eight Dollars and 30/100 ($53,658.30)
will be made payable as follows:
$37,158.30 8/24 Magic Audio Purchase of Recording Equipment
6,500.00 8/25 Galloway & Assoc. Legal services
10,000.00 9/99 Skreem.Ent. Corp. Operating Expenses
This note secured by the recording equipment. Both parties understand that
this is not an arm's length transaction and that Thomas L. Tedrow is an
officer and director of both corporations.
/s/ Signature 8-20-99
- ------------- -------
Jeffrey D. Martin, President Date
Skreem Entertainment Corporation
/s/ Signature 8-20-99
_____________ _______
Witness Date
/s/ Signature 8-20-99
_____________ _______
Thomas L. Tedrow, President Date
Skreem.com Corporation
<PAGE> 3
SKREEM.COM CORPORATION
SECURED PROMISSORY NOTE
Interest at 8%
Winter Park, Florida
September 17, 1999
Union Online (organized Internet Services, Inc.) Promises to pay to the order
of Skreem.com Corporation in Winter Park, Florida, or at such other place as
holder hereof may designate in writing, the sum of Fifty Thousand and 00/1000
($50,000), payable upon demand by Skreem.com Corporation.
Fifty Thousand Dollars ($50,000) will be wired to Union Online (Organized
Internet Services, Inc.) Within 24 hours after receipt of the signed note. If
the wire confirmation is not received in 24 hours, this note will be null and
void.
This note is secured by 200,000 shares of common stock. Skreem.com
Corporation, shall receive 50,000 share of restricted commmon stock of Union
Online as further compensation.
/s/ Signature 10/14/99
- ------------- --------
Jacques Loveall, President Date
Union Online/Organized Internet Services, Inc.
/s/ Signature 10/17/99
- ------------- --------
Date
/s/ Signature 9/17/99
- ------------- -------
Thomas L. Tedrow, President Date
Skreem.com Corporation
Instructions:
Fax copy of the signed note to: (407) 654-1704
Return Original By Fedex to: 1110 Palmer Ave., Winter Park, FL 32789
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<PERIOD-END> SEP-30-1999
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