FORM SB-2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
USA Telcom
(Name of small business issuer in its charter)
3360 W. Sahara #200, Las Vegas, NV 89102, (702) 732-2253
(Address and telephone number of Registrant's principal executive
offices and principal place of business)
NEVADA 88-0408213
(State of organization or (Employer Identification
Jurisdiction) Number)
Shawn F. Hackman a P.C., 3360 W. Sahara #200, Las Vegas, NV
89102, (702) 732-2253
(Name, address, and telephone number of agent for service)
Approximate date of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
If this Form is filed If this Form is a post- If delivery of the
to register additional effective amendment prospectus is
securities for an filed pursuant to Rule expected to be
offering pursuant to 462(c) under the made pursuant to
Rule 462(b) under the Securities Act, check Rule 434, please
Securities Act, please the following box and check the
check the following list the Securities following box.
box and list the Act registration
Securities Act statement number of
registration number of the earlier effective
the earlier effective registration statement
registration statement for the same offering.
for the same offering.
CALCULATION OF REGISTRATION FEE
Title of Amount to Proposed Proposed Amount of
each class be maximum maximum registration
of registered offering aggregate fee
securities price per offering
to be unit price
registered
Common 5,000,000 $0.10 $500,000 $ 350.00
shares
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.
The shares offered hereby are highly speculative and involve a
high degree of risk to public investors and should be purchased
only by persons who can afford to lose their entire investment.
(See "Risk Factors" on page 2).
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.
PROSPECTUS
USA Telcom
5,000,000 Shares
Common Stock
Offering Price $0.10 per Share
USA Telcom, (the "Company") is offering for sale 5,000,000
Shares of its Common Stock, $.001 par value per share (the
"Shares") on an " best efforts" basis, pursuant to the terms of
this Prospectus (See "OFFERING.")
Offering Net
Price Proceeds
To Public To
Company(1)
Per Share: $ 0.10 $0.10
Maximum (5,000,000 $500,000
shares)
(1) The Company anticipates no sales commissions.
A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN
FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, BUT HAS NOT
YET BECOME EFFECTIVE. INFORMATION CONTAINED HEREIN IS SUBJECT TO
COMPLETION OR AMENDMENT. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE
AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL
THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH
OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO
REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY
STATE.
Subject to Completion, Dated __________________, 1999
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.
THE SHARES ARE OFFERED BY THE COMPANY SUBJECT TO PRIOR SALE,
ACCEPTANCE OF THE SUBSCRIPTIONS BY THE COMPANY AND APPROVAL OF
CERTAIN LEGAL MATTERS BY COUNSEL TO THE COMPANY.
ALL OFFEREES AND SUBSCRIBERS WILL HAVE AN OPPORTUNITY TO MEET
WITH REPRESENTATIVES OF THE COMPANY TO VERIFY ANY OF THE
INFORMATION INCLUDED HEREIN AND TO OBTAIN ADDITIONAL INFORMATION
REGARDING THE COMPANY. COPIES OF ALL DOCUMENTS, CONTRACTS,
FINANCIAL STATEMENTS AND OTHER COMPANY RECORDS WILL BE MADE
AVAILABLE FOR INSPECTION AT ANY SUCH MEETING OR DURING NORMAL
BUSINESS HOURS UPON REQUEST TO THE COMPANY.
ALL OFFEREES AND SUBSCRIBERS WILL BE ASKED TO ACKNOWLEDGE IN THE
SUBSCRIPTION AGREEMENT THAT THEY HAVE READ THIS MEMORANDUM
CAREFULLY AND THOROUGHLY, THEY WERE GIVEN THE OPPORTUNITY TO
OBTAIN ADDITIONAL INFORMATION; AND THEY DID SO TO THEIR
SATISFACTION.
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS MEMORANDUM AND, IF GIVEN OR
MADE SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON
AS HAVING BEEN AUTHORIZED. THIS MEMORANDUM DOES NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES TO ANY PERSON IN ANY JURISDICTION WHERE SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL. THE DELIVERY OF THIS MEMORANDUM
AT ANY TIME DOES NOT IMPLY THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF TIME SUBSEQUENT TO ITS DATE.
THE COMPANY HAS THE RIGHT, IN ITS SOLE DISCRETION, TO ACCEPT OR
REJECT SUBSCRIPTIONS IN WHOLE OR IN PART, FOR ANY REASON OR FOR
NO REASON.
<PAGE>
USA Telcom
Table of Contents
Page No.
MEMORANDUM SUMMARY 1
RISK FACTORS 2
USE OF PROCEEDS 7
DETERMINATION OF OFFERING PRICE 7
DILUTION 7
PLAN OF DISTRIBUTION 9
LEGAL PROCEEDINGS 10
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS 10
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 15
DESCRIPTION OF SECURITIES 15
INTEREST OF NAMED EXPERTS AND COUNSEL 17
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES 17
ORGANIZATION WITHIN LAST FIVE YEARS 18
DESCRIPTION OF BUSINESS 18
MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION 19
DESCRIPTION OF PROPERTY 19
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 19
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 19
EXECUTIVE COMPENSATION 19
FINANCIAL STATEMENTS 20
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE 20
<PAGE>
MEMORANDUM SUMMARY
The following summary is qualified in its entirety by detailed
information appearing elsewhere in this Memorandum. Each
prospective investor is urged to read this Memorandum in its
entirety.
THE COMPANY
USA Telcom, (the "Company") is a Nevada corporation formed
on November 5, 1998. The Company's offices are located at 3360 W.
Sahara #20, Las Vegas, NV 89102, (702) 732-2253.
The Company's principal business involves setting up
telecommunication services in Vietnam. The Company has no
operations to date, but believes that it is positioned to take
advantage of a coming boom in Vietnamese telecommunications. (See
"DESCRIPTION OF THE BUSINESS.")
Management has knowledge that loans are available from
United States and Europe entities for business in this area.
Management is actively exploring these financing options.
Management has spend substantial time in contact with individuals
and entities in the United States, Europe and Asia forming
relationships (not yet contractual) which the Company hopes to
turn into profitable contract for the Company. Allen Jones has
been actively engaged in telcom internationally since 1993 with
other companies.
THE OFFERING
The Company is offering 5,000,000 shares of its common stock
for sale in accordance with the terms of this Prospectus.
Securities Offered:
Total 5,000,000 Shares
Offering Price Per Share: $0.10
Shares Outstanding:
Before the Offering
Total 7,000,000 Shares
After the Offering
Total 12,000,000 Shares
USE OF NET PROCEEDS
If all the Shares offered are sold, net proceeds to the
Company will be approximately $500,000. These proceeds will be
used to purchase materials needed to initiate the Company's entry
into the marketplace. (See "USE OF PROCEEDS.")
RISK FACTORS
THE SHARES OFFERED HEREBY ARE HIGHLY SPECULATIVE AND INVOLVE A
HIGH DEGREE OF RISK TO THE PUBLIC INVESTORS AND SHOULD BE
PURCHASED ONLY BY PERSONS WHO CAN AFFORD TO LOSE THEIR ENTIRE
INVESTMENT.
The common stock is subject to the normal risks of
fluctuating market prices. As the company's business is centered
on Internet services, the stock value is subject further to
continued interest in and use of the Internet, and the acceptance
by the on-line community of the Company's Internet-based
offerings. In addition, holders of the common stock should not
expect to receive dividends, and are not able to vote their
shares cumulatively for election of directors. Because the stock
is expected to be thinly traded, a purchaser may not be able to
liquidate his or her investment immediately.
Other risks involve dilution, the lack of management's
experience in this industry, the Company's lack of operational
history, competition from outside entities, a lack of
diversification, the possible need for additional financing, and
possible purchases by affiliates.
DILUTION
The offering involves a dilution in the per share book value
of the Common Stock from the public offering price. (See
"Description of Common Stock.")
FINANCIAL HIGHLIGHTS
The following schedule sets forth certain financial
information of the Company at the date indicated. (See "FINANCIAL
STATEMENTS.")
Date: October 1, 1999
Total Assets $265,000
Total Liabilities
Stockholders' Equity $265,000
RISK FACTORS
RISK FACTORS RELATING TO THE COMPANY'S BUSINESS
The Company has only recently begun operations. Although it
is entering an area with impressive growth potential, there are
very real risk factors that must be considered by potential
investors. These include, but are not limited to, the following:
Lack of Prior Operations and Experience
The Company is newly organized, has no significant assets, and
has no revenues from operations. There can be no assurance that
the Company will operate at a profitable level in the future, or
that the Company will generate revenues.
Investment Valuation Determined by the Board of Directors
The Company's Board of Directors is responsible for valuation of
the Company's investments. There are a wide range of values which
are reasonable for an investment of the Company's assets.
Although the Board of Directors can adopt several methods for an
accurate evaluation, ultimately the determination of fair value
involves subjective judgment not capable of substantiation by
auditing standards. Accordingly, in some instances it may not be
possible to substantiate by auditing standards the value of the
Company's investments. The Company's Board of Directors will
serve as the valuation committee, responsible for valuing each of
the Company's investments. In connection with any future
distributions which the Company may make, the value of the
securities received by investors as determined by the Board may
not be the actual value that the investors would be able to
obtain even if they sought to sell such securities immediately
after a distribution. In addition, the value of the distribution
may decrease or increase significantly subsequent to the
distributee shareholders' receipt thereof, not withstanding the
accuracy of the Board's evaluation.
Competition
The Company may experience substantial competition in its efforts
to attract retail merchants and customers. Other providers, many
of whom have greater experience, resources, and managerial
capabilities than the Company, are in a better position to obtain
access to attractive clientele. The Company hopes to minimize
this risk by seeking a specific niche in the internet
marketplace. (See "DESCRIPTION OF BUSINESS.")
Success of Management
Any potential investor is strongly cautioned that the purchase of
the securities offered hereby should be evaluated in light of:
(i) the limited diversification of the venture capital
opportunities afforded to the Company, (ii) the high-risk nature
and limited liquidity of the Company, and (iii) the Company's
ability to utilize funds for the successful development and
distribution of revenues as derived by the revenues received by
the Company's yet undeveloped portfolio of clients, and any new
potentially profitable ventures, among other things. The Company
can offer no assurance that any particular client and/or property
under its management contract will become successful.
Lack of Diversification
The size of the Company makes it unlikely that the Company will
be able to commit its funds to the acquisition of any major
accounts until the Company has a more well established track
record, and the Company may not be able to achieve the same level
of diversification as larger entities engaged in this type of
business. The lack of diversification may make the value of the
Company's proposed shares dependent, at least initially, on the
success of a relatively few, and perhaps even one client.
Conflicts of Interest
The officers and directors may have other interests to which they
devote substantial time and each will continue to do so
notwithstanding the fact that management time may be necessary to
the business of the Company. As a result, certain conflicts of
interest exist and will continue to exist between the Company and
its officers and directors which may not be susceptible to
resolution. Conflicts of interest may arise in the area of
corporate opportunities which can only be resolved through
exercise by the officers and directors of such judgment as is
consistent with their fiduciary duties to the Company. It is the
intention of management, so as to minimize any potential
conflicts of interest, to present first to the Company's Board of
Directors any proposed investments for its evaluation.
Additional Financing Required
The proceeds from this Offering are expected to be sufficient for
the Company to become operational. Even if all of the Shares are
sold, the funds available to the Company may not be adequate for
it to be competitive in the industry. There is no assurance that
additional funds will be available from any source when needed by
the Company for expansion; and, if not available, the Company may
not be able to expand its operation as rapidly as it could if
such financing were available. Additional financing could come in
the form of debt/preferred stock or a private placement of common
stock. If additional shares were issued to obtain financing,
investors in this offering see their percentage ownership of the
Company decrease. However, the book value of their shares would
not be diluted, provided the additional shares are sold at a
price greater than that paid by investors in this offering.
Absence of Cash Dividends
The Board of Directors does not anticipate paying cash dividends
on the Common Stock for the foreseeable future and intends to
retain any future earnings to finance the growth of the Company's
business. Payment of dividends, if any, will depend, among other
factors, on earnings, capital requirements, and the general
operating and financial condition of the Company, and will be
subject to legal limitations on the payment of dividends out of
paid-in capital. (See "DESCRIPTION OF SECURITIES - DIVIDENDS.")
RISK FACTORS RELATING TO THE NATURE OF THE OFFERING
Purchases by Affiliates
Certain officers, directors, principal shareholders, and
affiliates may purchase a portion of the Shares for investment
purposes.
Possible Loss of Entire Investment
The Shares offered hereby are highly speculative and involve a
high degree of risk. They should not be purchased by any person
who cannot afford the loss of his entire investment. A purchase
of the Company's stock in this Offering would be "unsuitable" for
a person who cannot afford to lose his or her entire investment.
Dilution to Public
Assuming the sale of all Shares offered hereby, the net tangible
book value of the Company's Shares would be approximately $.08
per share, compared to the $.10 public offering price.
Accordingly, persons purchasing common stock in this Offering
would suffer dilution of $.02 per share to the net tangible book
value.
Best Efforts Offering
The Shares are offered by the Company on an "best efforts" basis,
and no individual, firm or corporation has agreed to purchase or
take down any of the offered Shares. No assurance can be given
that any or all of the Shares will be sold
No Public Market for Company's Securities.
Prior to the Offering, there has been no public market for the
Common Stock being offered. There can be no assurance that an
active trading market will develop or that purchasers of the
Common Stock will be able to resell their securities at prices
equal to or greater than the respective initial public offering
prices. The market price of the Common Stock may be affected
significantly by factors such as announcements by the Company or
its competitors, variations in the Company's results of
operations, and market conditions in the industry in general. The
market price may also be affected by movements in prices of stock
in general. As a result of these factors, purchasers of the
Shares offered hereby may not be able to liquidate an investment
in the Shares readily or at all.
No Cumulative Voting
Holders of the Common Stock are not entitled to accumulate their
votes for the election of directors or otherwise. Accordingly,
the holders of a majority of the shares present at a meeting of
shareholders will be able to elect all of the directors of the
Company, and the minority shareholders will not be able to elect
a representative to the Company's board of directors. (See
"DESCRIPTION OF SECURITIES.")
Arbitrary Offering Price
The Offering Price of the Common Stock bears no relation to book
value, assets, earnings or any other objective criteria or value.
They have been arbitrarily determined by the Company. There can
be no assurance that, even if a public trading market develops,
the Common Stock will attain market values commensurate with the
Offering Price.
No Foreseeable Dividends
The Company does not anticipate paying dividends on its Common
Stock in the foreseeable future but plans to retain any and all
earnings for the operation and expansion of its business. (See
"DESCRIPTION OF SECURITIES.")
Shares Eligible For Future Sale
All of the 7,000,000 shares of Common Stock which are held by the
initial shareholders have been issued in reliance on the Private
Placement exemption under the Securities Act of 1933, as amended
(the "Act"). Such Shares will not be available for sale in the
open market without separate registration except in reliance upon
Rule 144 under the Act. In general, under Rule 144 a person (or
persons whose shares are aggregated) who has beneficially owned
shares acquired in a non-public transaction for at least two
years, including persons who may be deemed Affiliates of the
Company (as that term is defined under the Act) would be entitled
to sell within any three-month period a number of shares that
does not exceed the greater of 1% of the then outstanding shares
of common stock, or the average weekly reported trading volume on
all national securities exchanges and through NASDAQ during the
four calendar weeks preceding such sale, provided that certain
current public information is then available. If a substantial
number of the Shares owned by the initial shareholders were sold
pursuant to Rule 144 or a registered offering, the market price
of the Common Stock could be adversely affected.
USE OF PROCEEDS
Following the sale of 5,000,000 shares of common stock, the gross
proceeds to the Company will be $500,000. The Company anticipates
using these funds for the following purposes:
Use of Proceeds: Amount:
Legal Fees $15,000
Working Capital $485,000
Total $500,000
Management anticipates expending these funds for the purposes
indicated above. To the extent that expenditures are less than
projected, the resulting balances will be retained and used for
general working capital purposes or allocated according to the
discretion of the Board of Directors. Conversely, the extent that
such expenditures require the utilization of funds in excess of
the amounts anticipated, supplementing amounts may be drawn form
other sources, including, but not limited to general working
capital and/or external financing. The net proceeds of this
offering that are not expended immediately may be deposited in
interest or non-interest bearing accounts, or invested in
government obligations, certificates of deposit, commercial
paper, money market mutual funds or similar investments.
DETERMINATION OF OFFERING PRICE
The offering price is not based upon the Company's net worth,
total asset value, or any other objective measure of value based
upon accounting measurements. The offering price is determined by
the Board of Directors of the Company and was determined
arbitrarily based upon the amount of funds needed by the Company
to start-up the business, and the number of shares that the
initial shareholders were willing to allow to be sold.
DILUTION
"Dilution" is the difference between the public offering price of
a security such as the Common Stock, and its net tangible book
value per share immediately after the Offering, giving effect to
the receipt of net proceeds in the Offering. "Net tangible book
value" is the amount that results from subtracting the total
liabilities and intangible assets of an entity from its total
assets. As of October 1, 1999, the net tangible book value of the
Company was $265,000. Giving effect to the sale by the Company of
all Shares at the public offering price, the pro-forma net
tangible book value of the Company would be approximately
$765,000 or approximately $.08 per share, which would represent
a $.014 immediate increase in net tangible book value per share
and $.02 per share dilution to new investors.
The following table illustrates the pro forma per Share dilution:
Price to Public [1] $0.10
Net tangible book value per .066
Share before Offering [2]
Increase Attributable to .014
purchase of stock by new
investors [5]
Net tangible book value per .08
Share after offering
[2],[3],[4]
Dilution to new investors [6] .02
Percent Dilution to new 20%
investors [7].
[1] Offering price before deduction of offering expenses.
[2] The net tangible book value per share before the offering
($.066) is determined by dividing the number of Shares of
Common Stock outstanding into the net tangible book value of
the Company.
[3] The net tangible book value after the offering is determined
by adding the net tangible book value before the offering to
the estimated proceeds to the Corporation from the current
offering.
[4] The net tangible book value per share after the offering
($.08) is determined by dividing the number of Shares that
will be outstanding after the offering into the net tangible
book value after the offering as determined in note 3.
[5] The Increase Attributable to purchase of stock by new
investors is derived by taking the net tangible book value
per share after the offering ($.08) and subtracting from it
the net tangible book value per share before the offering
($.066) for an increase of $.014.
[6] The dilution to new investors is determined by subtracting
the net tangible book value per share after the offering
($.08) from the public offering price ($.10), giving a
dilution value of ($.02).
[7] The Percent Dilution to new investors is determined by
dividing the Dilution to new investors ($.02) by the Price to
the Public ($.10) giving a dilution to new investors of 20%.
COMPARATIVE DATA
The following chart illustrates the percentage ownership in the
Company held by the present shareholders and by the public
investors in this Offering, and sets forth a comparison of the
amounts paid by the present shareholders of the Company and by
the public investors in this Offering. The present shareholders
may, however, purchase a portion of the Shares offered hereby,
which would enable the Company to reach the escrow amount and
would increase the percentage of the Company's Common Stock owned
by such present shareholders at the conclusion of this Offering.
TOTAL Percentage Consideration Consideration Average
SHARES Purchased Amount Percentage Price per
Share
Present 7,000,000 58% $265,000 36% $0.066
Shareholders
New 5,000,000 42% $500,000 64% $0.10
Investors
Total 12,000,000 100.00% $765,000 100% $0.083
PLAN OF DISTRIBUTION
The Company will sell a maximum of 5,000,000 shares of its Common
Stock, par value $.001 per Share, to the public on a best efforts
basis. No underwriter has been retained by the Company.
The public offering price of the Shares will be modified, from
time to time, by amendment to this Prospectus, in accordance with
changes in the market price of the Company's common stock. The
Company anticipates a no sales commission.
The Shares are offered by the Company subject to prior sale and
subject to approval of certain legal matters by counsel. The
Company reserves the right to reject any subscription in whole or
in part, for any reason or for no reason.
OPPORTUNITY TO MAKE INQUIRIES
The Company will make available to each Offeree, prior to any
sale of the Shares, the opportunity to ask questions and receive
answers from the Company concerning any aspect of the investment
and to obtain any additional information contained in this
Memorandum, to the extent that the Company possesses such
information or can acquire it without unreasonable effort or
expense.
PROCEDURES FOR SUBSCRIBING
Each investor purchasing any of the Shares offered hereby will be
required to execute a Subscription Agreement which will contain,
among other provisions, representations as to the investor's
qualifications to purchase the common stock and his ability to
evaluate and bear the risk of an investment in the Company, and
will contain an acknowledgment of the receipt of the opportunity
to make inquiries and obtain additional information.
LEGAL PROCEEDINGS
There are no material legal proceedings involving the Company
that are known to the Company as of the date of this prospectus,
or that are known to have been threatened against the Company as
of the date of this Prospectus.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The names, addresses, ages, and respective positions of the
current directors and officers of the Company are as follows.
Each director is elected for a term of one year, or until their
replacement is elected. The Board of Directors appoints the
executive officers for a term of one year, or until their
replacement is appointed.
Name Age Position
Allen Jones 61 President/CEO/Director
Michael F. Browning 65 Secretary/Treasure/Director
ALLEN JONES
Mr. Jones is the President/CEO of the Company.
EDUCATION Kansas State College
Pre-Veterinary Medicine
PROFILE Bottom line responsibility with demonstrated
record of success in company turnaround and
rapid growth situations through operations
improvement and operating efficiencies.
Strong background of successful, effective
experience with multi-million dollar
responsibility, which proves the ability to
build a business into a growing, sound and
profitable operation using strong financial
and marketing strategies. An excellent
negotiation strategist, creative problem-
solver and consummate "dealmaker".
SUMMARY OF QUALIFICATIONS
Rapid and accurate analysis of people and situations.
Excellent tact and diplomacy in reacting to individuals
and situations.
Adept at recognizing and adjusting to the needs of others.
Profit and people-minded.
Enhanced professional negotiation skills in the foreign
marketplace.
Interpersonal skills in the international forum.
PROFESSIONAL EXPERIENCE
1998 to Present PRESIDENT/CEO
USA Telcom, Inc., Nevada, Proposed large
capital NASDAQ registration, 1999. (BCC)
Business Cooperation Contract, 30 year
license with Vietel Corporation, Vietnam Army
Telecommunications for country Vietnam which
includes:
1900 Mhz CDMA Mobile Telcom,
Wireless local loup residential telcom and
International Gateway USA-Vietnam Telcom.
1996 Feasibility Study, P & L accumulative
ten year estimate, US $3.3B for Vietnam
Telecommunications BCC license.
13 June-23 Sept. 1998
EXECTUVIE VICE PRESIDENT/FINANCIAL DIRECTOR
Harrison Digicom (Resigned after completing
due diligence)
Air Tel/SGN ETMC
1992 to 1998 PRESIDENT & CEO
American Ventures International
AMVI International
AMVI Humanitarian Development
Trade Development and Investment Projects in
Vietnam
1990 to 1991 PRESIDENT & CEO
Equities International
Greek and Turkey hydra foil vessel tourist
development
U.S. Navy, Textron and Korean Navy, vessel
technology transfer
1985 to 1990 ASSOCIATED INTERNATONAL INDUSTRIES, INC.
President
International trading USA, China, Honk Kong
and Korea.
1985 to 1988 ASSOCIATED RECREATIONAL INDUSTRIAL, INC.
President
Resort development.
1982 to 1984 CORPORATE RESORT MEMBERSHIP SALES
President
Membership sales throughout California and
Arizona. Company sold in 1984. Total sales
$2.7MM.
1977 to 1983 CORPORATE DEVELOPMENT OF 100 ACRES, 25 PARCEL
HILLSIDE DEVELOPMENT
President
Project sold in 1983. Booked $2.9MM
development loan.
1978 to 1982 CORPORATE DEVELOPMENT OF 300 ACRES
RECREATIONAL VEHICLE PARK
President
Business sold in 1982.
1977 to 1982 JONES DEVELOPMENT, INC., Orange County,
California
President and CEO
Secured Santa Ana development agency contract
to master of four acres across from Federal
Court House. Secured J.V. with Coldwell
Banker Investment for a seven story mid-rise
and thirteen-story hi-rise office buildings
and parking facility. Sold project in 1982.
1967 to 1977 Owned and operated two liquor marts in Los
Angeles County, from 1967 to 1974 and three
liquor, grocery and deli marts in Orange
County, from 1975 to 1977. Annual sales were
$2.2MM from 1975 to 1977. All stores sold by
September 1977, anticipating the elimination
of fair trade. Fair trade ended May 1978.
1961 to 1969 BUILDING MAINTENANCE CORPORATION, Los
Angeles, California
President and CEO
Building maintenance services including
insurance claim repairs.
MICHAEL F. BROWNING
EDUCATION: B.S. - School of Business Administration -
University Arizona 1956
CAREER PROFILE: Real Estate Development Executive with
extensive experience in real estate
development, marketing, acquisitions and
management with major development companies,
brokerage companies and financial
institutions. Experienced in Financial
Feasibility Analysis, Property Entitlements,
contract negotiations, marketing, financing,
development management and asset management.
EMPLOYMENT HISTORY:
1993 to Present UNI-MED REALTY ADVISORS, Inc., Newport Beach,
California
Partner
Uni-Med Realty Advisors is a firm engaged in
medical related real estate including
consulting services, brokerage and property
management.
The corporation provides consulting services
to major hospitals in Southern California and
with a national healthcare organization which
owns hospitals throughout the country.
Property management assignments includes
hospital and privately owned medical office
buildings totaling over 900,000 square feet.
The partnership acts as the exclusive leasing
agent of office buildings in Southern
California.
1987 to 1993 BENTALL DEVELOPMENT CO., Santa Ana,
California
Vice President Development
Bentall Development Company is a wholly owned
U.S. subsidiary of Bentall Corporation, a
privately owned Canadian development,
investment and property management company
with assets in excess of $600 million.
Assembled, managed and directed the
activities of a 10 person professional
development team. Analyzed and acquired ten
development sites and two investment
properties, including a 300,000 square foot
office project and a 100,000 square foot
office project. Developed three industrial
parks, a 10-story, 210,000 square foot Class
"A" office building with a seven level, 700
car parking structure. Assembled a city
block in downtown San Diego, which was
entitled for 500,000 square feet of office
with subterranean parking. Created a joint
venture for development of a 175,000 square
foot office building and parking structure in
South Orange County and secured all required
entitlements. Reported to the president of
the company.
1997 to 1987 COLDWELL BANKER COMMERCIAL GROUP REAL ESTATE
DEVELOPMENT SERVICES, Newport Beach,
California
Vice President and Manager, Newport Beach
Office
Managed a directed a team of development
professionals in consulting development
operations. Developed for clients on a fee
basis office buildings, industrial buildings
and shopping centers in Southern California,
Arizona and New Mexico. Provided clients
with all development functions, including
feasibility, entitlement, selection and
direction of consultants, selection and
management of general contractors, budgeting,
arranging financing and marketing the
projects.
1976 to 1977 BENEFICIAL STANDARD PROPERTIES, INC., Los
Angeles, California
Director of Industrial Marketing and Property
Maintenance
Managed a large life insurance company,
commercial and industrial real estate
investment portfolio, including industrial
buildings and parks for lease or for sale,
neighborhood and regional shopping centers, a
mobile home park and multi-tenant residential
projects. Reported directly to the president
of the company.
1975 to 1976 STONEBRIDGE EQUITIES CORPORATION, Laguna
Beach, California
Partner
A partner is a company formed to package real
estate development projects for sale to
investors. Projects included a 125 acre
mixed use project in Southern California,
neighborhood shopping center and a single
family residential project in Riverside,
California.
1974 to 1975 TROY EQUITIES CORPORATION, Irvine, California
Vice President, Investments
Identified, underwrote and acquired
investment properties for Troy Investment
Fund, a public fund. Projects included
neighborhood shopping centers, high rise
residential building and a large industrial
park.
1959 to 1974 PACIFIC MUTUAL LIFE INSURANCE COMPANY,
Newport Beach, California
Director of Real Estate
Managed a large portfolio of investment
properties, including industrial buildings,
office buildings, regional shopping centers.
Responsibilities included asset management,
development management, major lease
negotiations, acquisitions and sales.
LICENSE; REAL ESTATE BROKER - California
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table identifies all holders who are known to
management to control, either individually or beneficially, a
number of shares equal to or greater than 5% of the issued and
outstanding shares as of June 30, 1999. All of the shareholders
are officers and directors. Therefore, only one table is shown
below.
Title of Name and address of Amount and Percent of
class beneficial owner nature of class
beneficial
owner
Common Ahatol Fin 6,800,000 96%
Common AVI 200,000 4%
DESCRIPTION OF SECURITIES
The authorized capital stock of the Company consists of
25,000,000 shares of Common Stock, $0.001 par value per share.
The holders of Common Stock (i) have equal ratable rights to
dividends from funds legally available therefore, when, as, and
if declared by the Board of Directors of the Company; (ii) are
entitled to share ratably in all of the assets of the Company
available for distribution upon winding up of the affairs of the
Company; (iii) do not have preemptive subscription or conversion
rights and there are no redemption or sinking fund applicable
thereto; and (iv) are entitled to one non-cumulative vote per
share, on all matters on which shareholders may vote at all
meetings of shareholders. As of the date of this memorandum, the
Company had 7,000,000 shares of common stock outstanding.
The rights and preferences of the Preferred Stock may be set by
the directors of the Company. To date, no Preferred Stock has
been issued, and the directors have not identified any of the
rights or preferences thereof.
NON-CUMULATIVE VOTING
The holders of Shares of Common Stock of the Company do not have
cumulative voting rights, which means that the holders of more
than 50% of such outstanding Shares, voting for the election of
directors, can elect all of the directors to be elected, if they
so choose. In such event, the holders of the remaining Shares
will not be able to elect any of the Company's directors. After
the present offering is completed, if all of the Shares offered
are sold to the public, the public shareholders will own
approximately 42% of the outstanding shares of the Company.
DIVIDENDS
The Company does not currently intend to pay cash dividends. The
Company's proposed dividend policy is to make distributions of
its revenues to its stockholders when the Company's Board of
Directors deems such distributions appropriate. Because the
Company does not intend to make cash distributions, potential
shareholders would need to sell their shares to realize a return
on their investment. There can be no assurances of the projected
values of the shares, nor can there be any guarantees of the
success of the Company.
A distribution of revenues will be made only when, in the
judgment of the Company's Board of Directors, it is in the best
interest of the Company's stockholders to do so. The Board of
Directors will review, among other things, the investment quality
and marketability of the securities considered for distribution;
the impact of a distribution of the investee's securities on its
customers, joint venture associates, management contracts, other
investors, financial institutions, and the company's internal
management, plus the tax consequences and the market effects of
an initial or broader distribution of such securities. (See "RISK
FACTORS - No Foreseeable Dividends.")
POSSIBLE ANTI-TAKEOVER EFFECTS OF AUTHORIZED BUT UNISSUED STOCK
Upon the completion of this Offering, the Company's authorized
but unissued capital stock will consist of 13,000,000 shares
(assuming the entire offering is sold) of common stock. One
effect of the existence of authorized but unissued capital stock
may be to enable the Board of Directors to render more difficult
or to discourage an attempt to obtain control of the Company by
means of a merger, tender offer, proxy contest, or otherwise, and
thereby to protect the continuity of the Company's management.
If, in the due exercise of its fiduciary obligations, for
example, the Board of Directors were to determine that a takeover
proposal was not in the Company's best interests, such shares
could be issued by the Board of Directors without stockholder
approval in one or more private placements or other transactions
that might prevent, or render more difficult or costly,
completion of the takeover transaction by diluting the voting or
other rights of the proposed acquiror or insurgent stockholder or
stockholder group, by creating a substantial voting block in
institutional or other hands that might undertake to support the
position of the incumbent Board of Directors, by effecting an
acquisition that might complicate or preclude the takeover, or
otherwise.
TRANSFER AGENT
The Company has engaged the services of Pacific Stock Transfer,
Las Vegas, Nevada, and expects to continue using them as the
transfer agent for the Company's stock.
INTEREST OF NAMED EXPERTS AND COUNSEL
None.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES
The Company and its affiliates may not be liable to its
shareholders for errors in judgment or other acts or omissions
not amounting to intentional misconduct, fraud, or knowing
violations of the law, since provisions have been made in the
Articles of Incorporation and By-Laws limiting such liability.
The Articles of Incorporation and By-Laws also provide for
indemnification of the officers and directors of the Company in
most cases for any liability suffered by them or arising out of
their activities as officers and directors of the Company if they
were not engaged in intentional misconduct, fraud, or knowing
violations of the law. The company's Articles of Incorporation
and By-laws limit the liability of directors and officers to the
maximum extent permitted by Nevada law (Section 78.751).
Therefore, purchasers of these securities may have a more limited
right of action than they would have except for this limitation.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "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
Act and is, therefore, unenforceable.
ORGANIZATION WITHIN LAST FIVE YEARS
Not Applicable.
DESCRIPTION OF BUSINESS
(a) Business Development
The Company was incorporated in the State of Nevada on November
5, 1998. To date, the Company has had no operations.
(b) Business of Issuer
The Company's principal business involves setting up
telecommunications in Vietnam.
Management has knowledge that loans are available from
United States and Europe entities for business in this area.
Management is actively exploring these financing options.
Management has spend substantial time in contact with individuals
and entities in the United States, Europe and Asia forming
relationships (not yet contractual) which the Company hopes to
turn into profitable contract for the Company. Allen Jones has
been actively engaged in telcom internationally since 1993 with
other companies.
(c) Reports to Security Holders
The Company is not a reporting company as that term is defined in
the Exchange Act of 1934. It has not sent out annual report to
the shareholders, as those individuals are the executive officers
and directors of the Company and, therefore, have had access to
all material information concerning the Company. Until such time
as its reports are on file with the Securities & Exchange
Commission, the issuer will voluntarily send annual reports,
including audited financial statements, to holders of its common
stock.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION
USA Telcom, (the "Company") is a Nevada corporation formed
on November 5, 1998. The Company's offices are located at 3360 W.
Sahara #200, Las Vegas, NV 89102, (702) 732-2253.
The Company's principal business involves setting up
telecommunication and services in the United States and Vietnam.
The Company has no operations to date, but believes that it is
positioned to take advantage of a coming boom in Vietnamese
telecommunications. (See "DESCRIPTION OF THE BUSINESS.")
Management has knowledge that loans are available from
United States and Europe entities for business in this area.
Management is actively exploring these financing options.
Management has spend substantial time in contact with individuals
and entities in the United States, Europe and Asia forming
relationships (not yet contractual) which the Company hopes to
turn into profitable contract for the Company. Allen Jones has
been actively engaged in telcom internationally since 1993 with
other companies.
DESCRIPTION OF PROPERTY
The Company owns no real property. It leases the office space
used as the Company's principal offices.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
There is no market established for the Company's common stock.
There are currently three holders of the Company's common stock.
Those holders, who are deemed affiliates of the Company, own
7,000,000 shares, all of which are subject to trading
restrictions pursuant to Rule 144 promulgated under the
Securities Act of 1933.
EXECUTIVE COMPENSATION
The officers and directors will receive compensation once a
compensation plan is approved. The amount of their compensation
will be based upon the profitability of the corporation.
FINANCIAL STATEMENTS
As the Company is a startup, there have been no previous audited
financial statements prepared. The Company will provide such
statements upon completion of this offering. Preliminary
financial statements are provided as part of the Registration
Statement on file with the Securities and Exchange Commission.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Officers and Directors of the Company are accountable to the
Company as fiduciaries, which means such Officers and Directors
are required to exercise good faith and integrity in handling the
Company's affairs. A shareholder may be able to institute legal
action on behalf of himself and all other similarly situated
shareholders to recover damages where the Company has failed or
refused to observe the law.
Shareholders may, subject to applicable rules of civil procedure,
be able to bring a class action or derivative suit to enforce
their rights, including rights under certain federal and state
securities laws and regulations. Shareholders who have suffered
losses in connection with the purchase or sale of their interest
in the Company due to a breach of a fiduciary duty by an officer
or director of the Company in connection with such sale or
purchase, including the misapplication by any such Officer or
Director of the proceeds from the sale of these securities, may
be able to recover such losses from the Company.
The Company and its affiliates may not be liable to its
shareholders for errors in judgment or other acts or omissions
not amounting to intentional misconduct, fraud, or knowing
violations of the law, since provisions have been made in the
Articles of Incorporation and By-Laws limiting such liability.
The Articles of Incorporation and By-Laws also provide for
indemnification of the officers and directors of the Company in
most cases for any liability suffered by them or arising out of
their activities as officers and directors of the Company if they
were not engaged in intentional misconduct, fraud, or knowing
violations of the law. The company's Articles of Incorporation
and By-laws limit the liability of directors and officers to the
maximum extent permitted by Nevada law (Section 78.751).
Therefore, purchasers of these securities may have a more limited
right of action than they would have except for this limitation.
In the opinion of the Securities and Exchange Commission,
indemnification for liabilities arising under the Securities Act
of 1933 is contrary to public policy and, therefore,
unenforceable.
The Company will not acquire assets from its current management
or any entity in which such management has a five percent or
greater equity interest unless the Company has first received an
independent opinion as to the fairness of the terms of the
acquisition. In negotiating the terms of the acquisition of the
assets, management may be influenced by the possibility of future
personal benefit from unrelated business dealings with such
persons or entities. There can be no assurance that such conflict
of interest will be adequately resolved in favor of the Company
and its Shareholders. The Officers and Directors are required to
exercise good faith and integrity in handling the Company's
affairs. Management of the Company has agreed to abide by this
fiduciary duty.
It should be noted that this is a rapidly developing and changing
area of the law. Investors are urged to consult their own legal
counsel.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The Company anticipates that it will incur, in addition to
the commission associated with selling the common stock,
additional legal and registration expenses. These anticipated
costs are listed above (See "USE OF PROCEEDS.")
RECENT SALES OF UNREGISTERED SECURITIES
None
EXHIBITS
The following financial statements are attached:
Consolidated Balance Sheet
Statement of Changes in Stockholders' Equity
Consolidated Statement of Operations
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
The following exhibits are included:
(3.1) Articles of Incorporation
(3.2) By-Laws
(5) Opinion re: legality
(10) Material Contracts
(15) Letter on unaudited interim financial information
(22) Subsidiaries of the registrant
(24) Consent of experts and counsel
(25) Power of attorney
UNDERTAKINGS
(a) The Company agrees that it will:
(1) file, during any period in which it offers or sells
securities, a post-effective amendment to this registration
statement to
(i) include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement.
(iii) Include any additional or changed material information
on the plan of distribution.
(2) For determining liability under the Securities Act, treat
each post-effective amendment as a new registration statement of
the securities offered, and the offering of the securities at
that time to be the initial bona fide offering.
(3) File a post-effective amendment to remove from registration
any of the securities that remain unsold at the end of the
offering.
(e) Insofar as indemnifications for liabilities arising under
the Securities Act of 1933 (the "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 Act and is, therefore, unenforceable.
SIGNATURES
In accordance with the requirements of the Securities Act of
1933, the registrant hereby certifies that it has reasonable
grounds to believe that it meets all of the requirements of
filing on Form SB-2 and authorized this registration statement to
be signed on its behalf by the undersigned in the City of Las
Vegas, State of Nevada, on October 22, 1999.
Registrant USA Telcom
By /s/ Allen Jones
Allen Jones, President
In accordance with the requirements of the Securities Act of
1933, this registration statement was signed by the following
persons in the capacities and on the dates stated.
Signature /s/ Allen Jones
Allen Jones, President
Date October 22, 1999
