SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
OMB APPROVAL
OMB NUMBER 3235-0065
Expires May 31, 2000
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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VENTURE CAPITAL.COM INCORPORATED
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C> <C>
Nevada 6700 88-0446126
(State or Other Jurisdiction of (Primary Standard Industrial(I.R.S. Employer
Incorporation or Organization) Classification Number) Identification No.)
</TABLE>
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VENTURE CAPITAL.COM, INCORPORATED
6015 South Virginia Street, Suite 421
Reno, Nevada 89502
(916) 732-4554
(Address, Including Zip Code and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
------------------
James D. Martin
President, Chief Executive Officer and Director
VENTURE CAPITAL.COM, INCORPORATED
6015 South Virginia Street, Suite 421
Reno, Nevada 89502
(916) 732-4554
(Name, Address, Including Zip Code and Telephone Number,
Including Area Code, of Agent for Service)
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Copies to:
James D. Martin
6015 South Virginia Street, Suite 421
Reno, Nevada 89502
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Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes effective.
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If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, check the following box. [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. [_]
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
Proposed Maximum
Title of Securities Amount to be Proposed Maximum Aggregate Amount of
Securities to be Registered Registered Offering Price Offering Registration
Per Share (1) Price Fee
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.001 par
value........................ 1,000,000 $1.00 $1,000,000 264.00
(1) Estimated solely for the purpose of computing the registration fee
pursuant to Rule 457(o) of the Securities Act of 1933.
</TABLE>
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Company
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 Information in this prospectus is not complete and may be changed.
We may not sell these securities until the registration statement filed with
the Securities and Exchange Commission is effective. This prospectus is
not an offer to sell securities and is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
Shares
Common Stock
This is our initial public offering and no public market currently exists
for our shares. We anticipate that the initial public offering price will be
between $ and $ per share.
---------------
Investing in our common stock involves risks.
See "Risk Factors" beginning on page 7.
---------------
Per Share
Total
---------
Public Offering Price....................................... $ $
Underwriting Discounts and Commissions...................... $ $
Proceeds to Venture Capital.Com ........................... $ $
The Securities and Exchange Commission and state securities
regulators have not approved or disapproved of these securities or
determined if this prospectus is truthful or complete. Any representation
to the contrary is a criminal offense.
We have granted the underwriters a 30-day option to purchase up to an
additional shares of common stock to cover any over-allotments. If the
underwriters exercise the right in full, the public offering price will total
$ , the underwriting discounts and commissions will total $ , and our
proceeds will total $ .
Venture Capital.Com Inc. expects to deliver the shares of common
stock against payment in San Francisco, California on , 2000.
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The date of this Prospectus is , 2000
You should rely only on the information contained in this prospectus.
We have not authorized anyone to provide you with information
different from that contained in this prospectus. We are offering to sell,
and seeking offers to buy, shares of our common stock only in
jurisdictions where offers and sales are permitted. The information
contained in this prospectus is accurate only as of the date of this
prospectus, regardless of the time of delivery of this prospectus or of any
sale of our common stock.
Until , 2000, all dealers that buy, sell or trade our common stock,
whether or not participating in this offering, may be required to deliver a
prospectus. This requirement is in addition to the dealers' obligation to
deliver a prospectus when acting as underwriters and with respect to their
unsold allotment or subscriptions.
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TABLE OF CONTENTS
Page
Summary..................................................................5
Strategy.................................................................5
Corporate Information....................................................6
The Offering.............................................................6
Summary Financial Data...................................................6
Risk Factors.............................................................8
Information Regarding Forward Looking Statements.23
Use of Proceeds..........................................................23
Dividend Policy..........................................................24
Capitalization...........................................................24
Dilution.................................................................25
Selected Financial Data..................................................26
Management's Discussion and Analysis of Financial
Condition and Results
of Operations............................................................28
Business.................................................................32
Legal Matters............................................................37
Management...............................................................37
Executive Compensation...................................................38
Certain Transactions.....................................................48
Principal Stockholders...................................................49
Description of Capital Stock.............................................50
Shares Eligible for Future Sale..........................................52
Underwriting.............................................................54
Experts..................................................................57
Additional Information...................................................57
SUMMARY
You should read the following summary together with the more
detailed information and financial statements and the notes to
those statements appearing elsewhere in this prospectus. This
prospectus contains forward looking statements that involve risks
and uncertainties. Our actual results could differ materially from the
results anticipated in these forward looking statements as a result of
the factors set forth under "Risk Factors" and elsewhere in this
prospectus.
Venture Capital.Com, Incorporated
We intend to offer venture capital to parties and companies
in development. In addition we plan to offer business financing of
various types to start up businesses and established companies.
Our Strategy
Our objective is to become an Internet based provider of venture
capital, financing, investments and other business services needed
by businesses and companies in development To achieve this objective,
our strategy includes the following key elements:
. Enhancing our brand name through a variety of marketing
and promotional techniques;
. Forming strategic partnerships with companies in the Internet,
software, financial services and media industries;
. Leveraging our internet-based solution and technology platform to
enhance our service offering and expand the benefits of secure online
communications; and
Corporate Information
In 1999 our founder began research to investigate the feasibility
entering into an Internet based venture capital program also
offering additional business financing services. In December of 1999 we
were incorporated in the State of Nevada as Venture
Capital.Com, Incorporated.
Our executive offices are located at 6015 South Virginia Street,
Suite 421, Reno, Nevada 89502. Information contained on our Web Site
does not constitute part of this prospectus.
The Offering
Common stock offered....................... shares
Common stock to be outstanding after this
offering................................. shares
Use of proceeds............................ To expand marketing and
partnerships, for further development of our technology and for
working capital and other general corporate purposes.
Proposed Nasdaq National Market symbol has not been applied for at
this writing.
The number of shares outstanding after this offering is 25,000,000 shares.
Summary Financial Data
(in thousands, except share and per share data)
The following table sets forth certain of our summary financial data.
This information should be read in conjunction with the financial
statements and notes thereto appearing elsewhere in this prospectus.
The pro forma calculations give effect to the conversion of all
outstanding shares of our preferred stock into common stock upon the
closing of this offering as if such conversion occurred at inception, or the
date of original issuance, if later. Our as adjusted column reflects the sale
of shares of common stock offered hereby at the initial public offering
price of $ per share after deducting the underwriter discount
and estimated expenses payable by us.
<TABLE>
December 20, 1999 December 20, 1999
(inception) (inception)
through through
December 31, 1999 December 31, 1999
<CAPTION>
----------------- ---------------
<S> <C> <C> <C>
(unaudited) (unaudited)
Statement of Operations Data:
Net revenues.................. $ -- $ -- $ --
Loss from operations.......... -- --
Net loss...................... --
Basic and diluted net loss per
share....................... --
Pro forma basic and diluted
net loss per share..........
Shares outstanding used in
basic and diluted net loss
per share calculations......
Shares outstanding used in pro
forma basic and diluted net
loss per share calculation..
</TABLE>
As of December 31, 1999
(unaudited)
Actual As
Adjusted
-------
Balance Sheet Data:
Cash and cash equivalents................................... $-0-
Working capital............................................. -0-
Total assets................................................ -0-
Line of credit and capital lease obligations................ -0-
Total stockholders' equity.................................. -0-
RISK FACTORS
You should carefully consider the risks described below before making
an investment decision. The risks and uncertainties described below are
not the only ones facing our company. Additional risks and uncertainties
not presently known to us or that we currently deem immaterial may
also impair our business operations. If any of the following risks
actually occur, our business, financial condition or results of operations
could be materially adversely affected, the value of our stock could
decline, and you may lose all or part of your investment.
This prospectus also contains forward looking statements that
involve risks and uncertainties. Our actual results could differ materially
from those anticipated in the forward looking statements as a result of the
risks described below and elsewhere in this prospectus.
We face risks associated with our operations
We have not commenced operations as yet. We have no clients and
we may not be able to attract a client base. We face uncertainty in the
Internet venture capital market. As of December 31, 1999, we had
not generated any revenues. We are in the early stages of development
and expect to incur losses in the future.
We expect to incur increasing sales and marketing, product development
and administrative expenses. As a result, we will need to generate
significant revenues to achieve and maintain profitability. We cannot
be certain that we will achieve sufficient revenues for profitability. If we
do achieve profitability, we cannot be certain that we can sustain or
increase profitability on a quarterly or annual basis.
Our ability to obtain and retain customers depends on our customer
service capabilities. We plan to add customer service personnel and
resources to meet demand for our Internet venture capital service;
however, we cannot predict whether the quantity or quality of our
customer service will be sufficient to address our customers' needs. If we
are unable at any time during and after our controlled national launch
to appropriately address customer service issues or provide a
satisfactory customer experience for current or potential customers,
our business and reputation may be damaged.
We may be unable to effectively manage our rapid growth.
Our reputation and our ability to attract, retain and serve our customers
depend upon the reliable performance of our Web site, network
infrastructure and transaction-processing systems. We have a limited
basis upon which to evaluate the capability of our service to handle
controlled or full commercial availability of our Internet venture
capital service. We will need to improve existing and implement
new transaction-processing, operational and financial systems,
procedures and controls. In addition, we will need to expand, train
and manage an employee base. We will also need to expand our finance,
administrative and operations staff. In addition, we will be required to
relocate our administrative and operations personnel due to capacity
constraints at our current facility. We may not be able to effectively
manage this growth. Our planned expansion and we expect our future
expansion to place a significant strain on our managerial, operational
and financial resources. Our current and planned personnel,
systems, procedures and controls may be inadequate to support our
future operations. If we are unable to manage growth effectively
or experience disruptions during our expansion, our business will suffer
and our financial condition and results of operations will be
seriously affected.
We have a limited operating history.
In March, 1999, our founder began to investigate the feasibility of
entering into the Internet based venture capital business. In December
1999 we were incorporated in the State of Nevada and accordingly, we
have a very limited operating history. As of December 31, 1999 we
had generated no revenues and do not expect to generate any
significant revenues for some time.
You should consider our prospects in light of the risks and
difficulties frequently encountered by early stage companies in new
and rapidly evolving markets. These risks include, among other things,
our:
. need to expand our sales and support organizations;
. ability to establish and expand our brand name;
. ability to expand our operations to meet the commercial demand for
our service;
. development of and reliance on strategic and distribution
relationships;
. ability to prevent and respond quickly to service interruptions;
. competition from our competitors with greater capital resources and
brand awareness.
We have not established strategic relationships with any third parties.
We believe we must establish substantial relationships to effectively
market our service. We have limited experience in establishing
and maintaining these strategic relationships and we may fail in our
efforts to establish and maintain our strategic relationships.
As is customary with technology companies, from time to time, we may
receive or become aware of correspondence claiming potential
infringement of other parties' proprietary rights. We could incur
significant costs and diversion of management time and resources to
defend claims regardless of the validity of these claims.
We may not have adequate resources to defend these claims, and
any associated costs and distractions could have a material adverse effect
on our business, financial condition and results of operations. As
an alternative to litigation, we may seek licenses for other parties'
intellectual property rights. We may not be successful in obtaining
any necessary licenses on commercially reasonable terms, if at all.
We rely on a combination of patent, trade secret, copyright and
trademark laws and contractual restrictions to establish and
protect proprietary rights in our products, services, know-how
and information.
We will rely on several types of services for revenues.
We expect that a substantial percentage, if not all, of our future
revenues will be generated from our Internet venture capital service.
Our ability to gain commercial acceptance of our Internet venture
capital service is critical to our success. Any failure to successfully
gain commercial acceptance of our Internet venture capital service would
not only have a material adverse effect on our business and results
of operations but also on our ability to seek any incremental
revenue opportunities.
Despite our efforts to minimize interruption and security risks, our
systems and operations are vulnerable to damage or interruption from
a number of sources, including fire, flood, power loss,
telecommunications failure, break-ins, earthquakes and similar events.
Our servers are vulnerable to computer viruses, physical or
electronic break-ins and similar disruptions. We have experienced
system interruptions in the past and may experience them again in the
future. Any substantial interruptions in the future could result in the
loss of data and could completely impair our ability to generate
revenues from our service. We do not presently have a formal
disaster recovery plan in effect. We are currently evaluating our
business interruption insurance to determine whether we have
sufficient coverage to compensate us for losses that may occur after
our commercial launch.
A significant barrier to electronic commerce and communications is the
secure transmission of confidential information over public
networks. Anyone who is able to circumvent our security measures
could misappropriate proprietary information or cause interruptions in
our operations. Advances incomputer capabilities, new discoveries in
the field of cryptography, or other events or developments may result in
a compromise or breach of the algorithms we may use to protect
customer transaction data. Should someone circumvent our
security measures, it could seriously harm our reputation, business,
financial condition and results of operations.
Security breaches could also expose us to a risk of loss or litigation
and possible liability for failing to secure confidential customer
information. As a result, we may be required to expend a significant
amount of financial and other resources to protect against security
breaches or to alleviate any problems that they may cause.
We may face disruptions in our operations during our relocation to a new
facility in the near future.
Our current facilities are inadequate for our current growth plans.
As a result, we will be relocating all operations to new facilities in the
near future. We may experience temporary interruptions in our
normal operating activities during the moving process.
If we experience more permanent disruptions related to our move, or if
we are unable to complete the move in a timely manner, our
development efforts and business could be harmed.
We will need to expand our product and service offerings.
We may pursue the acquisition of new or complementary
businesses, products or technologies in an effort to enter into new
business areas, diversify our sources of revenue and expand our product
and service offerings. At present, we have no commitments or
agreements and are not currently engaged in discussions for any
material acquisitions or investments. To the extent we pursue new
or complementary businesses, we may not be able to expand our
service offerings and related operations in a cost-effective or timely
manner. We may experience increased costs, delays and diversions
of management's attention when integrating any new businesses or
services. We may lose key personnel from our operations or those of
any acquired business. Furthermore, any new business or service we
launch that is not favorably received by users could damage our
reputation and brand name. We also cannot be certain that we will
generate satisfactory revenues from any expanded services or products
to offset related costs. Any expansion of our operations would also
require significant additional expenses, and these efforts may strain
our management, financial and operational resources. Additionally,
future acquisitions may also result in potentially dilutive issuances of
equity securities, the incurrence of additional debt, the assumption of
known and unknown liabilities, and the amortization of expenses related
to goodwill and other intangible assets, all of which could have a
material adverse effect on our business, financial condition and
operating results. New issuances of securities may also have
rights, preferences and privileges senior to those of our common stock.
We expect that the fluctuations in our operating results could cause our
stock price to fall.
As of December 31, 1999, we had not generated any revenues from our
operations. Accordingly, we have little basis upon which to predict future
operating results. We expect that our revenues, margins and operating
results will fluctuate significantly due to a variety of factors, many of which
are outside of our control. These factors include:
. timing of the commercial release of our Internet venture capital
service;
. the costs of our marketing programs to establish the Venture
Capital.Com brand name;
. demand for our Internet services;
. our ability to develop and maintain strategic
relationships;
. the number, timing and significance of new products or services
introduced by both us and our competitors;
. our ability to develop, market and introduce new and enhanced
services on a timely basis;
. the level of service and price competition;
. changes in our operating expenses as we expand operations; and
. general economic factors.
Our cost of revenues includes costs for systems operations, customer
service, Internet connection and security services; all of these costs
fluctuate depending upon the demand for our service. In addition,
a substantial portion of our operating expenses will be related to
personnel costs, marketing programs and overhead, which cannot be
adjusted quickly and are therefore relatively fixed in the short term.
Our operating expense levels are based, in significant part, on
our expectations of future revenues. If our expenses precede
increased revenues, both gross margins and results of operations would
be materially and adversely affected because a relatively small amount of
our costs and expenses varies with our revenues in the short term.
Due to the foregoing factors and the other risks discussed in this
prospectus, you should not rely on period-to-period comparisons of
our results of operations as an indication of future performance.
It is possible that in some future periods our results of operations will
be below the expectations of public market analysts and investors. In
this event, the market price of our common stock is likely to fall.
We may not achieve broad brand recognition necessary to succeed.
We must quickly build our Venture Capital.com brand to gain
market acceptance for our service. We believe it is imperative to our
long term success that we obtain significant market share for our
services before other competitors enter the Venture Capital markets. We
must make substantial expenditures on product development,
strategic relationships and marketing initiatives in an effort to establish
our brand awareness. In addition, we must devote significant
resources to ensure that our users are provided with a high quality online
experience supported by a high level of customer service. We cannot
be certain that we will have sufficient resources to build our brand and
realize commercial acceptance of our service. If we fail to gain
market acceptance for our service, our business will suffer dramatically.
We will face intense competition.
The market for Venture Capital products and services is not new and
we expect it to be intensely competitive. At present there are numerous
other companies and financial institutions around the country which are
in competition in the venture capital markets.
We expect that our competitors will include:
. traditional providers of venture capital products and services;
. potential providers of venture capital products and services,
Banks, finance companies, private investors and groups, domestic and
foreign;
. a number of indirect competitors that offer financial services
or derive a substantial portion of their revenue from business lending,
electronic
commerce; and
. other companies with substantial customer bases in the computer and
other technical fields.
We may not be able to establish or maintain a competitive position
against current or future competitors as they enter the market.
Many of our competitors have longer operating histories, larger
customer bases, greater brand recognition, greater financial,
marketing, service, support,
technical, intellectual property and other resources than us. As a result,
our competitors may be able to devote greater resources to marketing and
promotional campaigns, adopt more aggressive pricing policies and
devote substantially more resources to Web site and systems
development than us. This increased competition may result in
reduced operating margins, loss of market share and a diminished brand.
We may from time to time make certain pricing, service or
marketing decisions or acquisitions as a strategic response to changes in
the competitive environment. These actions could result in reduced
margins and seriously harm our business.
We also face competitive pressures from new technologies and
the expansion of existing technologies. Companies that control access
to transactions through a network or Web browsers could also promote
our competitors or charge us a substantial fee for inclusion. Our
competitors may also be acquired by, receive investments from or enter
into other commercial relationships with larger, better-established
and better-financed companies as use of the Internet and other online
services increases. We may be unable to compete successfully
against current and future competitors, and the competitive pressures we
face could seriously harm our business.
We rely on relatively new management and need additional personnel to
grow our business.
Our management is new and we intend to continue to hire key
management personnel, including a Chief Operating Officer. For
example, our Founder and Chief Executive Officer, James Martin was
hired in December , 1999 and at present is the only officer and employee
of the Company. There can be no assurance that we will
successfully assimilate new managers or that we can successfully locate,
hire, assimilate and retain qualified key management personnel. Our
business is largely dependent on the personal efforts and abilities of
our senior management, including Mr. Martin, our Chief Executive
Officer, and managers we expect to hire in the future as other key
personnel. Any of our officers or employees can terminate his or
her employment relationship at any time. The loss of certain key
employees or our inability to attract or retain other qualified employees
could have a material adverse effect on our results of operations and
financial condition.
Our future success depends on our ability to attract, retain and
motivate highly skilled technical, managerial, editorial,
merchandising, marketing and customer service personnel. We plan to
hire additional personnel in all areas of our business. Competition for
such personnel is intense, particularly in the Internet and high
technology industries.
As a result, we may be unable to successfully attract, assimilate or
retain qualified personnel. Further, we may be unable to retain the
employees we currently employ or attract additional technical personnel.
The failure to retain and attract the necessary personnel could seriously
harm our business, financial condition and results of operations.
We may not be able to keep up with rapid technological and other
changes.
The development of our service and other proprietary technology
entails significant technical and business risks. To remain competitive,
we must continue to enhance and improve the responsiveness,
functionality and features of our online operations. The Internet and
the electronic commerce industry are characterized by:
. rapid technological change;
. changes in user and customer requirements and preferences;
. frequent new product and service introductions embodying new
technologies; and
. the emergence of new industry standards and practices.
The evolving nature of the Internet could render our existing
technology and systems obsolete.Our success will depend, in part, on
our ability to:
. license or acquire leading technologies useful in our business;
. enhance our existing service;
. develop new services and technology that address the increasingly
sophisticated and varied needs of our current and prospective users;
and
. respond to technological advances and emerging industry and
regulatory standards and practices in a cost-effective and timely
manner.
Future advances in technology may not be beneficial to, or
compatible with, our business. Furthermore, we may not successfully use
new technologies effectively or adapt our proprietary technology
and transaction-processing systems to user requirements or emerging
industry standards on a timely basis. Our ability to remain
technologically competitive may require substantial expenditures and
lead time.
If we are unable to adapt in a timely manner to changing market
conditions or user requirements, our business, financial condition and
results of operations could be seriously harmed.
If we achieve significant international acceptance of our service, our
business activities will be subject to a variety of potential risks, including
the adoption of laws and regulatory requirements, political and economic
conditions, difficulties protecting our intellectual property rights and
actions by third parties that would restrict or eliminate our ability to do
business in certain jurisdictions. If we begin to transact business in
foreign currencies, we will become subject to the risks attendant
to transacting in foreign currencies, including the potential adverse effects
of exchange rate fluctuations.
Many existing computer systems and software products are coded to
accept only two digit entries in the date code field and cannot distinguish
21st century dates from 20th century dates. If not corrected, there could
be system failures or miscalculations causing disruptions of
operations, including, among other things, a temporary inability to
process transactions, send invoices or engage in normal business
activities. As a result, many companies' software and computer systems
may need to be upgraded or replaced to comply with these
"Year 2000" requirements.
We use and depend on third-party equipment and software that may not
be Year 2000 compliant. We have not completed an assessment of
this third-party equipment and software. If Year 2000 issues prevent our
users from accessing the Internet or our service, our business and
operations will suffer.
Any failure of our third-party equipment or software to operate
properly could require us to incur unanticipated expenses, which
could seriously harm our business, operating results and financial
condition.
Our failure to make our service Year 2000 compliant could result in:
. a decrease in sales of our service;
. an increase in the allocation of resources to address Year 2000
problems of our users without additional revenue commensurate with
such dedication of resources; and
. an increase in litigation costs relating to losses suffered by our
users due to such Year 2000 problems.
Furthermore, the purchasing patterns of users or potential users may be
affected by Year 2000 issues as companies expend significant resources to
correct their current systems. These expenditures may result in reduced
funds available to take advantage our service, which could seriously harm
our business, operating results and financial condition. We have
conducted a preliminary review of our internal computer systems to
identify the systems that could be affected by the Year 2000 issue. Based
on this preliminary review, we believe that our internal software systems
are Year 2000 compliant. However, we continually evaluate our systems
and intend to develop a contingency plan to address any Year 2000 issues
we discover.
We may be unable to meet our future capital requirements.
We believe that our current cash balances together with the net
proceeds of this offering will allow us to fund our operations for at least
the next 12 months. However, we may require substantial working capital
to fund our business and we may need to raise additional capital. We
cannot be certain that additional funds will be available on satisfactory
terms when needed, if at all. Our future capital needs depend on many
factors, including:
. market acceptance of Internet venture capital;
. the level of promotion and advertising required to launch our service;
and
. changes in technology.
The various elements of our business and growth strategies, including our
plans to support fully the commercial release of our service, our
introduction of new products and services and our investments
in infrastructure will require additional capital. If we are unable to
raise additional necessary capital in the future, we may be required to
curtail our operations significantly or obtain funding through
the relinquishment of significant technology or markets.
Also, raising additional equity capital would have a dilutive effect on
existing stockholders.
We face risks related to the Internet industry
The success of our business will depend on the continued growth of
the Internet electronic commerce and the acceptance by consumers of
an Internet venture capital sales channel.
Our success depends in part on widespread acceptance and use of the
Internet as a way to take advantage of venture capital. This practice is at
an early stage of development, and demand and continued market
acceptance is uncertain. We cannot predict the extent to which users will
be willing to shift their habits from traditional to online contacts. To
be successful, our future clients must accept and utilize e-commerce to
satisfy their product needs. Our future revenues and profits, if
any, substantially depend upon theacceptance and use of the Internet
and other online services as an effective medium of commerce by our
target users.
The Internet may not become a viable long-term commercial
marketplace due to potentially inadequate development of the
necessary network infrastructure or delayed development of
enabling technologies and performance improvements. The
commercial acceptance and use of the Internet may not continue to
develop at historical rates. Our business, financial condition and results
of operations would be seriously harmed if:
. use of the Internet and other online services does not continue to
increase or increases more slowly than expected;
. the infrastructure for the Internet and other online services does not
effectively support future expansion;
. concerns over security and privacy inhibit the growth of the Internet;
or
. the Internet and other online services do not become a viable
commercial marketplace.
Regulatory and legal uncertainties could harm our business.
We are not currently subject to direct regulation by any domestic or
foreign governmental agency, other than regulations applicable to
businesses generally, and laws or regulations directly applicable to
electronic commerce. However, due to the increasing popularity and use
of the Internet, it is possible that a number of laws and regulations may
be adopted with respect to the Internet, relating to:
. user privacy;
. pricing;
. content;
. copyrights;
. distribution; and
. characteristics and quality of products and services.
The adoption of any additional laws or regulations may decrease the
expansion of the Internet. A decline in the growth of the Internet could
decrease demand for our products and services and increase our cost of
doing business. Moreover, the applicability of existing laws to the Internet
is uncertain with regard to many issues governing issues such as property
ownership, export of encryption technology, sales tax, libel and
personal privacy. Our business, financial condition and results of
operations could be seriously harmed by any such new legislation
or regulation. The application of laws and regulations from
jurisdictions whose laws do not currently apply to our business, or
the application of existing laws and regulations to the Internet and
other online services could also harm our business.
We plan to offer our service over the Internet in multiple states and
foreign countries. Such jurisdictions may claim that we are required to
qualify to do business as a foreign corporation in each state or
foreign country. Our failure to qualify as a foreign corporation in
a jurisdiction where we are required to do so could subject us to taxes
and penalties.
Other states and foreign countries may also attempt to regulate our
Internet commerce or prosecute us for violations of their laws. Further,
we might unintentionally violate such laws and such laws may be
modified and new laws may be enacted in the future.
We are subject to risks related to the offering.
No prior public market exists for our common stock.
Prior to this offering, there has been no public market for our common
stock and we cannot be sure that an active trading market for the
common stock will develop or continue as a result of this offering.
The concentrated control of our company could adversely affect
stockholders.
After this offering, our executive officers, directors and 5%
stockholders, in the aggregate, will control % of our voting stock.
As a result, these stockholders will have significant influence and ability
to control most matters requiring board and stockholder approval,
including a significant corporate transaction like the sale of our company,
a change in control, or the terms of future equity financings.
Purchasers in this offering will experience immediate and
substantial dilution.
If you purchase common stock in this offering, you will incur
immediate and substantial dilution in the net tangible book value of
the shares purchased. We estimate this dilution to be approximately
$ per share, or approximately % (based on an initial public offering
price of $ ). Additional dilution may occur upon the exercise of
outstanding stock options.
Our stock price could fluctuate dramatically.
The trading price of our common stock is likely to be volatile and
could fluctuate dramatically in response to: factors such as the
following, some of which are beyond our control:
. changes in expectations of our future financial performance, including
financial estimates by securities analysts and investors;
. changes in operating and stock price performance of other Internet and
online companies similar to us;
. future sales of our common stock; or
. general economic factors.
Domestic and international stock markets often experience significant
price and volume fluctuations.
These fluctuations, as well as general economic and political
conditions unrelated to our performance may adversely affect the price of
our common stock. In particular, following initial public offerings, the
market prices for stocks of Internet and technology-related companies
often reach levels that bear no relationship to the operating performance
of these companies. These market prices are generally not sustainable
and could vary widely. The market prices of the securities of Internet-
related and online companies have been especially volatile. If our
common stock trades to such high levels following this offering, it
could eventually experience a significant decline.
Our offering price does not necessarily relate to any established criteria of
value.
Through negotiations with the underwriters, we will determine the
public offering price of the shares of our common stock. This price will
not necessarily relate to our book value, assets, past operating
results, financial condition or any other established criteria of value. As
a result, the shares being offered may trade at market prices below the
initial public offering price.
Additional shares may be sold into the public market.
Sales of substantial amounts of our common stock in the public
market after this offering could adversely affect the prevailing market
price of our common stock. Upon completion of this offering, we will
have shares of common stock outstanding. Of those shares, a total of
shares (plus additional shares if the underwriters exercise
their over-allotment option in full) will
be freely tradable under the Securities Act unless purchased or held by our
"affiliates," as that term is defined in Rule 144 under the Securities Act.
Sales of substantial amounts of common stock in the public market,
or the perception that such sales could occur, could adversely affect the
prevailing market price for the common stock and could impair our ability
to raise capital through a public offering of equity securities.
Our management has broad discretion over use of the proceeds from this
offering.
The net proceeds of this offering are estimated to be approximately $
million (approximately $ million if the underwriters' over-allotment is
exercised in full) at an assumed initial public offering price of $ per
share and after deducting the estimated underwriting discount and
estimated offering expenses.
Our management will retain broad discretion as to the allocation of
the proceeds of this offering.
Certain provisions in our charter documents could deter takeover
efforts.
Provisions of our Certificate of Incorporation, Bylaws and Nevada
law could make it more difficult for a third party to acquire us, even if
doing so would be beneficial to our stockholders. Nevada statute
could prohibit or delay the accomplishment of mergers or other takeover
or change in control in attempts with respect to us and, accordingly,
may discourage attempts to acquire us.
---------------------
INFORMATION REGARDING FORWARD LOOKING STATEMENTS
This prospectus contains forward looking statements that are based on
our current expectations, assumptions, estimates and projections about us
and our industry. When used in this prospectus, the words
"expects," "anticipates," "estimates," "intends," "believes" and
similar expressions are intended to identify forward looking
statements. These statements include, but are not limited to, statements
under the captions "Risk Factors," "Use of Proceeds,"
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," "Business" and elsewhere in this prospectus.
These forward looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those projected.
The cautionary statements made in this prospectus should be read as
being applicable to all related forward looking statements wherever
they appear in this prospectus.
USE OF PROCEEDS
Our net proceeds from the sale of the shares of common stock
offered hereby are estimated to be approximately $ ($ million of the
underwriters exercise their over-allotment option in full) based upon an
assumed offering price of $ per share and after deducting estimated
underwriting discounts and commissions and estimated offering
expenses payable by us.
We intend to use the net proceeds of the offering:
. for expansion of our marketing and distribution partnerships;
. to enhance our server and network infrastructure and the functionality
of our Web site; and
. for working capital and other general corporate purposes.
As of the date of this prospectus, we cannot specify with certainty the
particular uses for the net proceeds to be received upon completion of the
offering. Pending such uses, the net proceeds of the offering will be
invested in short-term, interest-bearing, investment-grade instruments.
We intend to maintain flexibility in our use of the proceeds of this
offering. The amounts actually expended for each of the purposes
listed above are at our discretion and may vary significantly depending
upon a number of factors, including the progress of our marketing
programs, capital spending requirements, and developments in the
venture capital markets and Internet commerce.
Accordingly, we reserve the right to reallocate the proceeds of this
offering as we deem appropriate.
From time to time, in the ordinary course of business, we may pursue the
acquisition of new or complementary businesses, products or technologies
in an effort to enter into new business areas, diversify our sources of
revenue and expand our product and service offerings. A portion of the
net proceeds may be used to fund acquisitions or investments.
We currently have no arrangements, agreements or understandings, and
are not engaged in active negotiations for any material acquisitions
or investments.
DIVIDEND POLICY
We have never declared nor paid cash dividends on our capital stock.
We currently intend to retain all available funds for use in the operation
and expansion of our business and do not anticipate paying any
cash dividends in the foreseeable future. Any future determination to
pay dividends will be at the discretion of our Board of Directors and
will depend on our results of operations, financial conditions, contractual
and legal restrictions and other factors it deems relevant.
CAPITALIZATION
The following table sets forth our capitalization as of December 31, 1999.
At present the company has no tangible assets and no liabilities. As a result
there is no financial statement which could be examined under audit
conditions.
December 31, 1999
- --------------------
(Unaudited)
Pro Forma
Actual As
Adjusted
-------
- -----------
Line of credit and capital lease obligations ............. $ -0-
------- -------
Stockholders' equity:
Common stock, par value $0.001; 25,000,000 shares
authorized, -0- issued and outstanding, actual;
authorized, -0- issued and outstanding, pro forma
as adjusted............................................
Additional paid-in capital................................ -0-
Notes receivable for stock sales.......................... -0-
Accumulated deficit during development stage.............. -0-
------- -------
Total stockholders' equity............................... $ -0-
Total capitalization.................................... $-0-
======= =======
DILUTION
Our pro forma net tangible book value as of December 31, 1999 was
approximately $ million, or $ per share of common stock. Pro forma net
tangible book value per share represents the amount of our pro forma
total tangible assets less pro forma total liabilities divided by the pro
forma number of shares of common stock outstanding as of December
31, 1999. Without taking into account any other changes in pro forma
net tangible book value other than to give effect to our sale of the shares
of common stock offered hereby and the receipt and application of the
net proceeds therefrom, the pro forma net tangible book value of as
of December 31, 1999 would have been $ million, or $ per share
of common stock. This represents an immediate increase in pro forma
net tangible book value of $ per share to existing stockholders and
an immediate dilution in pro forma net tangible book value of $ per
share to investors purchasing common stock in this offering.
The following table illustrates this per share dilution:
Assumed initial public offering price per share............... $
Pro forma net tangible book value per share as of December 31,
1999....................................................... $ -0-
Increase per share attributable to new investors.............
------
Pro forma net tangible book value per share after this
offering....................................................
- ------
Dilution per share to new investors........................... $ -0-
======
The following table summarizes, on a pro forma basis as of December
31, 1999 the difference between the number of shares of common
stock purchased from us, the total consideration paid and the average
price per share paid by existing stockholders and by new investors,
assuming an initial public offering price of $ per share and
before deducting estimated underwriting discounts and commissions
and estimated offering expenses payable by us:
Shares
Purchased Total Consideration
Average
-------------- ---------------------- Price
Number Percent Amount Percent per
Share
------ ------- ----------- ----------
- ---------
Existing stockholders....... $ -0- $
New investors............... -0-
Total..................... 100% $ 100%
=== === =========== =======
The foregoing table assumes no exercise of the
underwriters' over-allotment option or shares underlying outstanding
options. As of December 31, 1999, options to purchase shares
of common stock were outstanding at a weighted average exercise price
of $ per share. To the extent that these options are exercised,
new investors will experience further dilution.
SELECTED FINANCIAL DATA
(in thousands, except per share data)
The following selected financial data should be read in conjunction
with our financial statements and the notes to such statements
and "Management's Discussion and Analysis of Financial Condition
and Results of Operations" included elsewhere in this prospectus. We
have no financial statements, no assets or liabilities. We have no
statement of operations data for the period from inception through
December 31, 1999. In addition we have no balance sheet Please be
advised that historical results are not necessarily indicative of the results
to be expected in the future, and results of interim periods are not
necessarily indicative of results for the entire year.
December 31, 1999
------------------- -------------------
- ------------------
(unaudited)
(unaudited)
Statement of Operations
Data:
Net revenues............ $ -- $ -- $
- --
Costs and expenses:
Research and
development..........
General and
administrative....... --
---------- ----------
- -----------
Total costs and -0-
expenses............
Loss from operations....-0-
Interest expense, net...
---------- ----------
- -----------
Net loss................ $ -0-
========== ==========
===========
Basic and diluted net
loss per share........ $ -0-
Pro forma basic and
diluted net loss per
share................. $ -0-
Weighted average shares
outstanding used in
basic and diluted net
loss per share
calculation........... -0-
Weighted average shares
outstanding used in
pro forma basic and
diluted net loss per
share calculation..... -0-
As of
December 31, 1999
----------------- --------------
(unaudited)
Balance Sheet Data:
Cash and cash
equivalents........... $ -0-
Working capital......... -0-
Total assets............ -0-
Line of credit and
capital lease
obligations........... -0-
Total stockholders'
equity................ --
All expenses other than those related to research and development
are classified as general, administrative and have been provided for
outside of the Company by the Founder, James D. Martin at no cost to
the Company. Until we recognize revenue from our principal
business activities we shall classify all expenses related to research
and development as general and administrative.
In addition, the provision for income taxes which consist solely of
minimum state taxes is classified as general and administrative.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This prospectus contains forward looking statements that involve risks
and uncertainties. Actual events or results may differ materially from
those projected in such forward looking statements. See
"Information Regarding Forward Looking Statements." The
following discussion of our financial condition and results of operations
also should be read in conjunction with the financial statements and notes
to those statements included elsewhere in this prospectus.
Overview
We offer a convenient and easy to use service for individuals
and businesses to reach venture capital markets. We had no revenues
and immaterial expenses prior to our incorporation in Nevada on
December 20, 1999.
Our Results of Operations
Revenues. We have recognized no revenues to date and we do not
expect to recognize revenues until after we are able to commence
operations substantial.
Cost of Revenues. We currently have no cost of revenues because we
have not recognized any revenues to date. Once we begin to charge fees,
and, or collect profits revenues will primarily consist of costs related
to customer service activities and server and network operations and, to
a lesser extent, bank processing charges for customer fees paid.
Sales and Marketing Expenses. Costs related to our sales and
marketing efforts, which to date have not been significant, are
currently classified as general and administrative expenses until
we commence charging convenience fees. All costs to date have been
paid outside the Company by the Founder, James D. Martin.
Our sales and marketing expenses will consist of compensation for sales
and marketing personnel, advertising, creative development and
promotional costs and commissions. The majority of these costs will
be directed to programs designed to build brand name recognition, attract
a customer base and retain the anticipated customer base.
Research and Development Expenses. Our research and
development expenses have been minimal to date and these costs have
been paid outside the Company by the Founder, James D. Martin. We
believe that significant investments in research and development are
required to remain competitive. We expect that we will incur
significant research and development expenses in the future.
General and Administrative Expenses. Our general and administrative
expenses have been minimal to date and have been paid outside the
Company by the Founder, James D. Martin. We expect an increase in
our general and administrative expenses principally due to expected
increase in personnel, facility costs and professional service fees.
Liquidity and Capital Resources
Since our inception, we have financed our early stages of development
to date with funds provided by the Founder, James D. Martin. We have
no liquidity or capital resources at present.
We believe that with the net proceeds of this offering will allow us to
fund our operations for at least the next 12 months. However, we may
require substantial working capital to fund our business and we may need
to raise additional capital. We cannot be certain that additional funds will
be available on satisfactory terms when needed, if at all. Our future
capital needs depend on many factors, including:
. the timing of our development efforts and public approval of
our service;
. market acceptance of Internet Venture Capital services and products;
. the level of promotion and advertising required to launch our service;
and
. changes in technology.
The various elements of our business and growth strategies, including
our plans to support fully the commercial release of our service,
our introduction of new products and services and our investments
in infrastructure will require additional capital.
If we are unable to raise additional necessary capital in the future, we may
be required to curtail our operations significantly or obtain funding
through the relinquishment of significant technology or markets.
Also, raising additional equity capital would have a dilutive effect on existing
stockholders.
Year 2000
Many existing computer systems and software products are coded to
accept only two digit entries in the date code field and cannot distinguish
21st century dates from 20th century dates. If not corrected, there could
be system failures or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process
transactions, send invoices or engage in normal business activities.
As a result, many companies' software and computer systems may need to
be upgraded or replaced to comply with these "Year 2000" requirements.
We are in the process of reviewing the Year 2000 compliance of our
internally developed proprietary software. This review has included
testing to determine how our systems will function at and beyond the
Year 2000. Since inception, we have internally developed substantially all
of the systems for the operation of our Internet postage service.
These systems include the software used to provide customer interaction
and transaction-processing and distribution functions to our service, as well
as monitoring and back-up capabilities. Based upon our assessment to
date, we believe that our internally developed proprietary software is
Year 2000 compliant. However, we cannot be sure how our software
will integrate with other vendor-provided software.
We use and depend on third-party equipment and software, that may
not be Year 2000 compliant. We are currently assessing the Year
2000 readiness of other third-party supplied software, computer
technology and other services and of our vendors. Based upon the results
of this assessment, we will develop and implement, if necessary,
a remediation plan with respect to third-party software, third-party
vendors and computer technology and service that may fail to be Year
2000 compliant.
To date, the expenses associated with this assessment have not been
material and our potential remediation costs and potential remediation
plan cannot be determined at this time. If Year 2000 issues prevent our
users from accessing the Internet or our service, our business and
operations will suffer. Any failure of our third-party equipment or
software to operate properly could require us to incur unanticipated
expenses, which could seriously harm our business, operating results
and financial condition.
The Year 2000 readiness of the general infrastructure necessary to
support our operations is difficult to assess. For instance, we depend on
the integrity and stability of the Internet to provide our services. We
also depend on the Year 2000 compliance of the computer systems
and financial services used by consumers.
Thus, the infrastructure necessary to support our operations consists of
a network of computers and telecommunications systems located through
out the world and operated by numerous unrelated entities and
individuals, none of which have the ability to control or manage the
potential Year 2000 issues that may impact the entire infrastructure.
Our ability to assess the reliability of this infrastructure is limited and
relies solely on generally available news reports, surveys and
comparable industry data. Based on these sources, we believe most
entities and individuals that rely significantly on the Internet are
carefully reviewing and attempting to remediate issues relating to Year
2000 compliance, but it is not possible to predict whether these efforts
will be successful in reducing or eliminating the potential negative impact
of Year 2000 issues. A significant disruption in the ability of consumers
to reliably access the Internet or portions of it or to use their credit cards
or other electronic payment methods would have an adverse effect on
demand for our services and would have a material adverse effect on us.
At this time, we have not yet developed a contingency plan to address
situations that may result if we or our vendors are unable to achieve
Year 2000 compliance. The cost of developing and implementing such
a plan, if necessary, could be material. Any failure of our material
systems, our vendors' material systems or the Internet to be Year
2000 compliant could have material adverse consequences for us.
Such consequences could include difficulties in operating our
service effectively or conducting other fundamental parts of our business.
Recently Issued Accounting Pronouncements
The American Institute of Certified Public Accountants issued
Statement of Position, or SOP, No. 98-1, "Software for Internal Use,"
which provides guidance on accounting for the costs of computer
software developed or obtained for internal use. SOP No. 98-1 is effective
for financial statements for fiscal years beginning after December 15,
1999. We do not expect that the adoption of SOP No. 98-1 will have
a material impact on our financial statements.
BUSINESS
This prospectus contains forward looking statements that involve risks
and uncertainties. Actual results and the timing of certain events could
differ materially from those projected in the forward looking statements
due to a number of factors, including those set forth under "Risk Factors"
and elsewhere in this prospectus.
Our Company
We offer a convenient, means by which individuals and businesses
may make contact with Venture Capital Markets over the Internet. We
also intend to offer additional business and financial services in lending
and other capital markets which could be of interest to businesses and,
or individuals.
Overview of Our Industry
Growth of Internet Commerce
The Internet has emerged as a significant global communications
medium, enabling millions of people to share information and
conduct business electronically. A number of factors have contributed to
the growth of the Internet and its commercial use, including:
. the large and growing installed base of personal computers in homes
and businesses;
. improvements in network infrastructure and bandwidth;
. easier and cheaper access to the Internet;
. increased awareness of the Internet among consumer and business
users; and
. the rapidly expanding availability of online content and commerce
which
increases the value to users of being connected to the Internet.
According to International Data Corporation, or IDC, the number of
Web users worldwide will grow from an estimated 100 million in 1998
to 319 million by 2002. In addition, IDC estimates that the percentage of
such users buying goods and services on the Internet will grow from 26%
in December 1997 to 40% in December 2002. IDC further estimates that
the total value of goods and services purchased over the Web will
increase from approximately $12.4 billion in 1997 to approximately
$425.0 billion in 2002. Business-to-business commerce is expected to be
a significant driver in the future growth of Internet commerce. For
example, IDC estimates that business-to-consumer commerce on the
Internet will grow from approximately $5.0 billion in 1997 to
approximately $95.0 billion in 2002 while business-to-business commerce
on the Internet will grow from approximately $7.0 billion in 1997
to approximately $331.0 billion in 2002.
Rapid Growth in Internet Usage by Small Businesses
The small office/home office, or SOHO, and small business
markets represent a large and growing customer segment. According to
IDC, there were a combined 44.7 million small businesses and home
offices in the United States in 1998, a number which IDC forecasts will
grow to 57.6 million by 2002. For 1998, IDC reported that small
businesses with less than 100 employees numbered 7.4 million of which
77% had fewer than 10 employees. In addition, home offices numbered
37.3 million, of which 22.2 million were income producing home offices,
and the remainder were home offices used for corporate after hours work
or telecommuting.
We believe that small businesses increasingly will rely on the
functionality and pervasiveness of the Internet to reach and serve a large
and global group of end users. The reduced cost of selling and marketing
on the Web, the ability to build and serve a large base of
customers electronically and the potential for personalized low-cost
customer interaction provide significant economic advantages. These
overall benefits, combined with accessibility, have led to adoption of
the Internet by small businesses and home offices.
According to IDC, there will be 30.2 million US home offices accessing
the Internet by 2002. According to Cyber Dialogue/FindSVP's 1999
US Small Business Internet Survey, 43% of businesses with fewer than
100 employees are estimated to be online in 1999. Of those small
businesses that are currently online, 63% are already ordering products
and services online. The Cyber Dialogue/FindSVP survey also found
that 64% of online small businesses have employees who are online
multiple times a day. This increased use of the Internet has resulted in
small businesses becoming significant electronic commerce participants.
IDC estimates that small businesses accounted for $4.5 billion of
electronic commerce in 1998 and will account for approximately
$102.0 billion of electronic commerce activity in 2002.
Our Strategy
Our objective is to be a provider of convenient Internet Venture
Capital and financial services. To achieve this objective, our strategy
includes the following key elements:
Enhance Our Brand Name. We intend to increase our brand
recognition through a variety of marketing and promotional techniques
and co- marketing and co-branding agreements with strategic partners.
We also intend to promote our brand by conducting an ongoing
public relations campaign and developing affiliations and affinity
programs to extend the brand.
We believe that building the brand awareness of our Internet Services
is critical to attracting and expanding our installed base.
Leverage Our Premier Strategic Partnerships. We intend to develop
and leverage premier strategic partnerships to gain access to large
numbers of potential users, cooperatively market products and
services, cross-sell additional services and gain entry into new markets.
We believe that we can further leverage our future premier
strategic partnerships to enhance our brand name and grow our installed
base.
. significant up-front time and investment by potential competitors in
technology and technical infrastructure;
. strong brand awareness for our software-based Internet postage
solution; and
Rapidly Grow Our Installed Base. We intend to broaden our
future installed base through enhancing our brand, forming
strategic partnerships. We believe that our service can achieve
rapid distribution because there is no investment in hardware beyond a
PC and printer, and users can obtain exposure to our products and
services. We are primarily targeting the businesses of all types and sizes
well as certain segments of the corporate and consumer markets.
Leverage Our Internet-Based Technology Platform. We intend to
leverage our scaleable, e-commerce platform to enhance our service
offering and expand the benefits of secure online communications with
us. We will continue to invest in and enhance our technology in order
to increase efficiency, reliability and bandwidth, to expand services and
to reduce costs.
Pursue Our Incremental Revenue Opportunities. We intend to leverage
our brand, electronic commerce capabilities, infrastructure and user base
to develop incremental revenue opportunities. We will consider the
following opportunities:
. We intend to offer for sale advertising space on our Web Site in order
to produce revenues and to cross sell additional products, related
and unrelated to businesses and individuals.
. We have the opportunity to act as agents and brokers during our
early stages of development. Even though we are not able to fund
any projects at present we are able to act as agents and brokers
representing future clients for possible placement with other venture
capital firms, banks, asset based lenders and other potential investors.
Our Strategic Distribution Partners
Our objective is to achieve significant market penetration through
relationships with strategic partners in each of the four following
categories:
. Web portals, content sites and Internet service providers;
. independent software vendors;
We believe we will benefit from these relationships by achieving
positive brand association and a cost effective means of customer
acquisition. We believe our partners can leverage their relationships with
us to derive incremental revenue opportunities, including revenue
sharing arrangements with us, and provide additional value-added
services to their customers.
Our Marketing and Sales
We intend to establish a strong brand name by allocating
significant resources to our marketing and distribution efforts. In
addition, we will rely on traditional media and several other channels
to achieve exposure of our services, including:
Web Sites. We intend to work with high traffic Web sites
including portals, commerce and content sites, and other high
visibility Internet sites.
Affiliate Programs. We intend to leverage the traffic and customers
of other online sites by offering revenue-sharing opportunities to
affiliates that provide a link on their Web site. Affiliates can capitalize on
the ability to offer new, value-added services and increase repeat visits
to their site.
Financial Services. We will seek distribution and
co-branding opportunities with banks and brokerages by incorporating
our Internet service into online banking and investing offered by
financial service providers.
Direct Sales. We plan to seek direct contact with established
and developing companies who we wish to solicit as future clients.
We intend to contact these companies in person, by mail and telephone.
Our Competition
The market for venture capital and other financial services is not new
and we expect it to be intensely competitive.
There are quite a large number of venture capital firms in highly
intense competition with one another.
Overall, we may not be able to maintain a competitive position
against current or future competitors as they enter the markets in which
we compete. This is particularly true with respect to competitors with
greater financial, marketing, service, support, technical, intellectual
property and other resources than us. Our failure to maintain a
competitive position within the market could seriously harm our
business, financial condition and results of operations. We believe that
the principal competitive factors in our market include:
. Ability to successfully achieve commercial release of an Internet
venture capital product;
. Brand recognition;
. Convenience;
. Visibility;
. Accountability;
. Security;
Our Intellectual Property
As is customary with technology companies, from time to time, we
may receive or become aware of correspondence claiming
potential infringement of other parties' proprietary rights. We could
incur significant costs and diversion of management time and resources
to defend claims regardless of the validity of these claims. We may not
have adequate resources to defend these claims, and any associated costs
and distractions could have a material adverse effect on our
business, financial condition and results of operations. As an alternative
to litigation, we may seek licenses for other parties' intellectual
property rights. We may not be successful in obtaining any necessary
licenses on commercially reasonable terms, if at all.
Our Employees
As of December 31, 1999, we had one employee which is the
Founder, James D. Martin. We intend to expand significantly our
employee base in 2000.
Our Properties
Our corporate headquarters is located in a temporary facility located
at 6015 South Virginia Street, Suite 421, Reno, Nevada 89502. This
facility is not adequate and a new facility will be needed.
Legal Proceedings
We are not currently involved in any legal proceedings, nor have we
been involved in any such proceedings that has had or may have a
significant effect on our financial position. We are not aware of any
material legal proceedings pending against us. See "Risk Factors--
We face potential claims of infringement on other parties'
intellectual property rights."
MANAGEMENT
Directors and Executive Officers
The following table sets forth certain information regarding our executive
officers and directors as of December 31, 1999:
Name Age Position
----------------
- -----------------------------------------------------------------------
James D. Martin..... 41 Chief Executive Officer, President and Director
(1) Member of the Audit Committee.
(2) Member of the Compensation Committee.
James D. Martin is the founder has been our Chief Executive Officer
and President and a Director since incorporation in December, 1999.
From April 1994 to December 1999 Mr. Martin served as President and
Chief Operating officer of Capital Resources, an investment and
management firm. From March 1986 to April 1994 Mr. Martin served
as Vice President and Chief Financial Officer for American Mortgage,
a mortgage and investment company. From January 1980 to February
1986 Mr. Martin served as Vice President and Operations Manager of
Croddy Corporation, a mortgage banking firm. Mr. Martin received his
B. A. Degree in Business Administration and Finance from Roshdale
College in Toronto, Ontario.
The Board has established a Audit Committee to meet with and
consider suggestions from members of management and our
internal accounting personnel, as well as our independent
accountants, concerning our financial operations. The Audit Committee
also has the responsibility to review our audited financial statements
and consider and recommend the employment of, and approve the
fee arrangements with, independent accountants for both audit functions
and for advisory and other consulting services. The Audit Committee
is currently comprised of James D. Martin.
The Board has also established a Compensation Committee to review
and approve the compensation and benefits for our key executive
officers, administer our stock purchase, equity incentive and stock
option plans and make recommendations to the Board regarding such
matters. The Compensation Committee is currently comprised of James
D. Martin. Additions to the Board are expected in the future.
Directors who are also our employees are eligible to receive options
and be issued shares of common stock directly under our 2000
Stock Incentive Plan. Non-employee directors will also receive
automatic option grants pursuant to our 2000 Stock Incentive Plan,
subject to certain conditions.
Executive Compensation
The following summary compensation table sets forth
information concerning cash and non-cash compensation earned during
the fiscal year ended December 31, 1999 by our Chief Executive Officer
and each of our other four highest paid executive officers whose
total compensation exceeded or would have exceeded $100,000 during
such year had such officers provided services to us for the entire fiscal
year (the "Named Executive Officers").
Summary Compensation Table for Fiscal Year 1999
Long Term
Annual Compensation Compensation
-------------------- ------------
Securities
Name and Principal Other Annual Underlying All Other
Positions Salary ($) Bonus ($) Compensation ($) Options (#) Compensation
($) -0- -0- -0- -0-
----------- ---------- --------- ---------------- ------------ ------------
James D. Martin -0- --
President and Chief
Executive
Officer (December 31, 1999
to present).......... -0- -- --
Chief Financial Officer
and Senior
Vice President of
Operations........... -- -- --
Chief Executive Officer
and
President (December 20, 1999
to December 31, 1999 .... -- -- --
--
Vice President of
Business
Development............
Stock Options Granted During Fiscal Year 1999
The following table sets forth certain information regarding options to
purchase common stock granted to Named Executive Officers during
the fiscal year ended December 31, 1999.
No stock appreciation rights were granted to such individuals during
such year.
Potential
Realizable
Value at
Assumed Annual
Rates of Stock
Appreciation
For Option
Individual Grants
Term(4)
-------------------------------------------------------------
- ---------------
Number of Percentage of
Securities Total Options Granted Exercise
Underlying Options to Employees Price Per Expiration
Name Granted(1) in 1999(2) Share(3) Date
5%
10%
----------- --------------------- --------- ---------- ------- -------
James D. Martin......... -0- --
No stock options have been granted at this time.
Number of
Securities Value of
Underlying Unexercised
In-
Unexercised the-Money
Options at Options at
December 31, December 31,
1999(1) 1999(2)
---------------
- ---------------
Name Vested Unvested Vested
Unvested
---- ------ -------- ------
- --------
James D. Martin ............................. 0
Employment Agreements and Change in Control Arrangements
James D. Martin serves as President and Chief Executive Officer.
He receives no cash compensation at this time.
Our 2000 Stock Incentive Plan will include change in control
provisions which may result in the accelerated vesting of outstanding
option grants and stock issuances.
2000 Stock Incentive Plan
Introduction. Introduced December 1999 and approved by the director
in December, 1999. The 2000 plan will become effective when
the underwriting agreement for this offering is signed.
Share Reserve. shares of our common stock have been
authorized for issuance under the 2000 plan.
Programs. Our 2000 plan has five separate programs:
. the discretionary option grant program, under which eligible
individuals in our employ may be granted options to purchase shares
of our common stock at an exercise price not less than the fair market
value of those shares on the grant date;
. the stock issuance program, under which eligible individuals may be
issued shares of common stock directly, upon the attainment of
performance milestones or upon the completion of a period of service
or as a bonus for past services;
. the salary investment option grant program, under which our executive
officers and other highly compensated employees may be given the
opportunity to apply a portion of their base salary to the acquisition
of special below market stock option grants;
. the automatic option grant program, under which option grants will
automatically be made at periodic intervals to eligible non-employee
board members to purchase shares of common stock at an exercise
price equal to the fair market value of those shares on the grant date;
and
. the director fee option grant program, under which our non-employee
board members may be given the opportunity to apply a portion of any
retainer fee otherwise payable to them in cash for the year to the
acquisition of special below-market option grants.
Eligibility. The individuals eligible to participate in our 2000 plan
include our officers and other employees, our board members and any
consultants we hire.
Administration. The discretionary option grant and stock
issuance programs will be administered by our compensation committee.
This committee will determine which eligible individuals are to
receive option grants or stock issuances under those programs, the time
or times when the grants or issuances are to be made, the number of
shares subject to each grant or issuance, the status of any granted option
as either an incentive stock option or a nonstatutory stock option under
the federal tax laws, the vesting schedule to be in effect for the option
grant or stock issuance and the maximum term for which any granted
option is to remain outstanding. The compensation committee will also
have the authority to select the executive officers and other
highly compensated employees who may participate in the salary
investment option grant program in the event that program is put into
effect for one or more calendar years.
Plan Features. Our 2000 plan will include the following features:
. The exercise price for any options granted the plan may be paid in
cash or in shares of our common stock valued at fair market value on
the exercise date. The option may also be exercised through a same-
day sale program without any cash outlay by the optionee.
. The compensation committee will have the authority to cancel
outstanding options under the discretionary option grant program,
including any transferred options from our 2000 plan, in return for the
grant of new options for the same or different number of option shares
with an exercise price per share based upon the fair market value of
our common stock on the new grant date.
. Stock appreciation rights may be issued under the discretionary option
grant program. These rights will provide the holders with the election
to surrender their outstanding options for a payment from us equal to
the fair market value of the shares subject to the surrendered options
less the exercise price payable for those shares. We may make the
payment in cash or in shares of our common stock.
None of the options under our 2000 plan have any stock appreciation
rights.
Change in Control. The 2000 plan will include the following change in
control provisions which may result in the accelerated vesting of
outstanding option grants and stock issuances:
. In the event that we are acquired by merger or asset sale, each
outstanding option under the discretionary option grant program which
is not to be assumed by the successor corporation will
immediately become exercisable for all the option shares, and all
outstanding unvested shares will immediately vest, except to the extent
our repurchase rights with respect to those shares are to be assigned
to the successor corporation.
. The compensation committee will have complete discretion to grant
one or more options which will become exercisable for all the
option shares in the event those options are assumed in the acquisition
but the optionee's service with us or the acquiring entity is
subsequently terminated.
The vesting of any outstanding shares under
our 2000 plan may be accelerated upon similar terms and conditions.
. The compensation committee may grant options and structure repurchase
rights so that the shares subject to those options or repurchase rights
will immediately vest in connection with a successful tender offer for
more than fifty percent of our outstanding voting stock or a change in
the majority of our board through one or more contested elections. Such
accelerated vesting may occur either at the time of such transaction or
upon the subsequent termination of the individual's service.
. The options currently outstanding under our 2000 plan will immediately
vest in the event we are acquired and the acquiring company does not
assume those options. Any options which are so assumed will immediately
vest upon an involuntary termination of the optionee's employment
within 18 months after the acquisition.
Salary Investment Option Grant Program. In the event the compensation
committee decides to put this program into effect for one or more calendar
years, each of our executive officers and other highly compensated employees
may elect to reduce his or her base salary for the calendar year by an amount
not less than $10,000 nor more than $50,000. Each selected individual who
makes such an election will automatically be granted, on the first trading day
in January of the calendar year for which his or her salary reduction is to be
in effect, an option to purchase that number of shares of common stock
determined by dividing the salary reduction amount by two-thirds of the fair
market value per share of our common stock on the grant date. The option
will have exercise price per share equal to one-third of the fair market value
of the option shares on the grant date. As a result, the option will be
structured so that the fair market value of the option shares on the grant
date less the exercise price payable for those shares will be equal to the
amount of the salary reduction. The option will become exercisable in a series
of twelve equal monthly installments over the calendar year for which the
salary reduction is to be in effect.
Automatic Option Grant Program. Each individual who first becomes a
non- employee board member at any time after the effective date of this
offering will receive an option grant for shares of common stock on
the date such individual joins the board. In addition, on the date of each
annual stockholders meeting held after the effective date of this offering, each
non- employee board member who is to continue to serve as a non-employee
board member, including each of our current non-employee board members,
will automatically be granted an option to purchase shares
of common stock, provided such individual has served on the board for
at least six months.
Each automatic grant will have an exercise price per share equal to the
fair market value per share of our common stock on the grant date and will
have a term of 10 years, subject to earlier termination following the
optionee's cessation of board service. The option will be immediately
exercisable for all of the option shares; however, we may repurchase, at the
exercise price paid per share, any shares purchased under the option which
are not vested at the time of the optionee's cessation of board service. The
shares subject to each annual automatic grant will be fully-vested when
granted. The shares subject to each initial -share automatic
option grant will vest in a series of successive equal monthly
installments upon the optionee's completion of each month of board service
over the month period measured from the grant date. However, the
shares will immediately vest in full upon certain changes in control or
ownership or upon the optionee's death or disability while a board member.
Director Fee Option Grant Program. If this program is put into effect in
the future, then each non-employee board member may elect to apply all or
a portion of any cash retainer fee for the year to the acquisition of a below-
market option grant.
The option grant will automatically be made on the first trading day in
January in the year for which the non-employee board member would
otherwise be paid the cash retainer fee in the absence of his or her election.
The option will have an exercise price per share equal to one-third of the fair
market value of the option shares on the grant date, and the number of shares
subject to the option will be determined by dividing the amount of the
retainer fee applied to the program by two-thirds of the fair market value per
share of our common stock on the grant date. As a result, the option will be
structured so that the fair market value of the option shares on the grant date
less the exercise price payable for those shares will be equal to the portion of
the retainer fee applied to that option. The option will become exercisable in
a series of twelve equal monthly installments over the calendar year for which
the election is in effect. However, the option will become immediately
exercisable for all the option shares upon the death or disability of the
optionee while serving as a board member.
Additional Program Features. Our 2000 plan will also have the following
features:
. Outstanding options under the salary investment and director fee option
grant programs will immediately vest if we are acquired by a merger or
asset sale or if there is a successful tender offer for more than 50%
of our outstanding voting stock or a change in the majority of our board
through one or more contested elections.
. Limited stock appreciation rights will automatically be included as
part of each grant made under the salary investment option grant
program and the automatic and director fee option grant programs, and
these rights may also be granted to one or more officers as part of
their option grants under the discretionary option grant program.
Options with this feature may be surrendered to us upon the successful
completion of a hostile tender offer for more than 50% of our
outstanding voting stock. In return for the surrendered option, the
optionee will be entitled to a cash distribution from us in an amount
per surrendered option share based upon the highest price per share of
our common stock paid in that tender offer.
. The board may amend or modify the 2000 plan at any time, subject to any
required stockholder approval. The 2000 plan will terminate no later
than , 2000.
2000 Employee Stock Purchase Plan
Introduction. Our Employee Stock Purchase Plan was adopted by the board
in December 1999 and approved by the stockholders in December 1999. The
plan will become effective immediately upon the signing of the underwriting
agreement for this offering. The plan is designed to allow our eligible
employees and the eligible employees our participating subsidiaries to
purchase shares of common stock, at semi-annual intervals, with their
accumulated payroll deductions.
Share Reserve. shares of our common stock will initially be
reserved for issuance. The reserve will automatically increase on the first
trading day in January each year, beginning in calendar year 2000, by an
amount equal to percent ( %) of the total number of outstanding shares of
our common stock on the last trading day in December in the prior year.
In no event will any such annual increase exceed shares.
Offering Periods. The plan will have a series of successive offering
periods, each with a maximum duration of 24 months. The initial offering
period will start on the date the underwriting agreement for the offering
covered is signed and will end on the last business day in 2001.
The next offering period will start on the first business day in 2001,
and subsequent offering periods will set by our compensation committee.
Eligible Employees. Individuals scheduled to work more than 20 hours per
week for more than 5 calendar months per year may join an offering period
on the start date or any semi-annual entry date within that period.
Semi-annual entry dates will occur on the first business day of
and
each year. Individuals who become eligible employees after the
start date of an offering period may join the plan on any subsequent semi-
annual entry date within that offering period.
Payroll Deductions. A participant may contribute up to 15% of his or her
cash earnings through payroll deductions, and the accumulated deductions
will be applied to the purchase of shares on each semi-annual purchase
date . The purchase price per share will be equal to 85% of the fair
market value per share on the participant's entry date into the offering period
or, if lower, 85% of the fair market value per share on the semi-annual
purchase date.
Semi-annual purchase dates will occur on the last business day of
and each year. In no event, however, may any
participant purchase more than shares on any purchase date, and not
more than shares may be purchased in total by all participants
on
any purchase date.
Reset Feature. If the fair market value per share of our common stock on
any purchase date is less than the fair market value per share on the start
date of the two-year offering period, then that offering period will
automatically terminate, and a new two-year offering period will begin on
the next business day. All participants in the terminated offering will be
transferred to the new offering period.
Change in Control. Should we be acquired by merger or sale of
substantially all of our assets or more than fifty percent of our voting
securities, then all outstanding purchase rights will automatically be exercised
immediately prior to the effective date of the acquisition. The purchase price
will be equal to 85% of the market value per share on the participant's entry
date into the offering period in which an acquisition occurs or, if lower, 85%
of the fair market value per share immediately prior to the acquisition.
Plan Provisions. The following provisions will also be in effect under the
plan:
. The plan will terminate no later than the last business day of
2010.
. The board may at any time amend, suspend or discontinue the plan.
However, certain amendments may require stockholder approval.
Limitation on Liability and Indemnification Matters
The certificate of incorporation that we will adopt immediately prior to the
closing of this offering provides that, except to the extent prohibited by the
Nevada Corporation Law, our directors will not be personally liable to us or
our stockholders for monetary damages for any breach of fiduciary duty as
directors. Under the Nevada Corporation Law, the directors have a fiduciary
duty to Venture Capital.com which is not eliminated by this provision of the
certificate of incorporation and, in appropriate circumstances, equitable
remedies such as injunctive or other forms of nonmonetary relief will remain
available. In addition, each director will continue to be subject to liability
under the Nevada law for breach of the director's duty of loyalty, for acts or
omissions which are found by a court of competent jurisdiction to be not in
good faith or which involve intentional misconduct, or knowing violations of
law, for actions leading to improper personal benefit to the director, and for
payment of dividends or approval of stock repurchases or redemptions that
are prohibited by Nevada law. This provision also does not affect the
director's responsibilities under any other laws, such as the federal securities
laws or state or federal environmental laws. We have obtained liability
insurance for our officers and directors.
Nevada law empowers a corporation to indemnify its directors and officers
and to purchase insurance with respect to liability arising out of their
capacity or status as directors and officers, provided that this provision
shall not eliminate or limit the liability of a director: (a) for any breach of
the director's duty of loyalty to the corporation or its stockholders,
(b) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (c) arising under Nevada law,
or (d) for any transaction from which the director derived an
improper personal benefit. The Nevada law provides further that
the indemnification permitted thereunder shall not be deemed exclusive
of any other rights to which the directors and officers may be entitled
under the corporation's bylaws, any agreement, a vote of stockholders
or otherwise.
The corporate bylaws of provide that we shall, to the fullest extent permitted
by the Nevada law, 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)
by reason of the fact that such person is or was a director or officer, or is or
was serving at our request as a director or officer of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise,
against expenses (including attorneys' fees), judgements, fines and amounts
paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding.
We plan to enter into indemnification agreements with our directors and
certain of our officers containing provisions that may require us, among other
things, to indemnify such directors and officers against certain liabilities
that may arise by reason of their status or service as directors or
officers (other than liabilities arising from willful misconduct of a
culpable nature), to advance their expenses incurred as a result of
any proceeding against them as to which they could be indemnified, and
to obtain directors' and officers' liability insurance if maintained for
other directors or officers.
At present, there is no pending litigation or proceeding involving any
director, officer, employee or agent as to which indemnification will be
required or permitted. We are not aware of any threatened litigation or
proceeding which may result in a claim for such indemnification.
CERTAIN TRANSACTIONS
Since our inception in December 1999, there has not been, nor is there
currently proposed, any transaction to which we are a party in which the
amount involved exceeded $60,000 and in which any director, executive
officer, holder of more than 5% of our common stock or any member of the
immediate family of any of the foregoing persons had or will have a direct or
indirect material interest other than (1) compensation agreements and other
agreements and (2) the transactions described below.
We have issued an aggregate of no shares of common stock as of
December 31, 1999
PRINCIPAL STOCKHOLDERS
The following table sets forth information with respect to the beneficial
ownership of the common stock as of December 31, 1999, and as adjusted to
reflect the sale of the shares of common stock offered in this offering, by (1)
each stockholder whom we know to beneficially own 5% or more of the
outstanding shares of common stock, (2) each of our directors and Named
Executive Officers, and (3) all of our directors and executive officers as a
group. Unless otherwise indicated, the address of each beneficial owner listed
below is c/o Venture Capital.com Inc. 6015 South Virginia Street, Suite 421,
Reno, Nevada 89502
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Except as indicated by the
footnotes below, we believe, based on information furnished to us, that the
persons and entities named in the table below have sole voting and
investment power with respect to all shares of common stock shown as
beneficially owned by them. Percentage of beneficial ownership is based on
25,000,000 shares of common stock which Venture Capital.com is authorized
to issue under its Articles of Incorporation. These shares are deemed
outstanding for the purpose of determining the percentage ownership of the
optionee. No shares of common stock have actually been issued as of
December 31, 1999. These shares, however, are not deemed outstanding for
the purpose of computing the percentage ownership of any other stockholder.
Percentage of Shares
Beneficially Owned
------------------------
Number of Shares Before After Offering
Name of Beneficial Owner Beneficially Owned Offering
------------------------ ------------------ ---------- ----------
Named Executive Officers and
Directors:
James D. Martin -0-
DESCRIPTION OF CAPITAL STOCK
The following description of our securities and certain provisions of our
certificate of incorporation and bylaws are summaries.
Statements contained in this prospectus relating to such provisions are not
necessarily complete, copies of which have been filed with the Commission
as exhibits to our registration statement, of which this prospectus forms a
part. The description of common stock and preferred stock reflect changes to
our capital structure that will occur upon the closing of this offering in
accordance with the terms of the certificates that will be adopted by us
immediately prior to the closing of this offering.
Upon the closing of this offering, our authorized capital stock will
consist of shares of common stock, par value $0.001.
Common Stock
As of December 31, 1999, Venture Capital.Com is authorized to issue
25,000,000 shares of common stock at par value of $0.001. As of December
31, 1999 no shares of stock have been issued. Based on the number of shares
authorized outstanding as of that date and giving effect to the issuance of the
shares of common stock offered by us hereby, there will be shares of
common stock outstanding (assuming no exercise of the underwriters' over-
allotment option) upon the closing of the offering.
Holders of the common stock are entitled to one vote for each share held
on all matters submitted to a vote of the stockholders. Holders of common
stock are entitled to receive ratably such dividends, if any, as may be declared
by the Board of Directors out of legally available funds, subject to any
preferential dividend rights of any outstanding preferred stock. Upon our
liquidation, dissolution or winding up, the holders of common stock are
entitled to receive ratably our net assets available after the payment of all
debts and other liabilities and subject to the prior rights of any outstanding
preferred stock. Holders of common stock have no preemptive, subscription,
redemption or conversion rights. The outstanding shares of common stock
are, and the shares offered by us in this offering will be, upon receipt of
payment for such shares, fully paid and nonassessable. The rights, preferences
and privileges of holders of common stock are subject to, and may be
adversely affected by, the rights of holders of shares of any series of
preferred stock which we may designate and issue in the future
without further stockholder approval. Upon the closing of the offering,
there will be no shares of preferred stock outstanding.
Preferred Stock
There is no preferred stock at this time.
Warrants. There have been no warrants issued at this time.
Stockholder Action; Special Meeting of Stockholders. The bylaws provide
that stockholders may not take action by written consent, but only at duly
called annual or special meetings of stockholders. The bylaws further provide
that special meetings of our stockholders may be called only by the Chairman
of the Board of Directors or a majority of the Board of Directors.
Advance Notice Requirements for Stockholder Proposals and Director
Nominations. The bylaws provide that stockholders seeking to bring business
before an annual meeting of stockholders, or to nominate candidates for
election as directors at an annual meeting of stockholders, must provide
timely notice thereof in writing. To be timely, a stockholder's notice must be
delivered to or mailed and received at our principal executive offices not less
than days nor more than days prior to the first anniversary of the
date of
our notice of annual meeting provided with respect to the previous year's
annual meeting of stockholders; provided, that if no annual meeting of
stockholders was held in the previous year or the date of the annual meeting
of stockholders has been changed to be more than 30 calendar days earlier
than or 60 calendar days after such anniversary, notice by the stockholder, to
be timely, must be so received not more than 90 days before nor later than the
later of (a) 60 days prior to the annual meeting of stockholders or (b) the
close of business on the 10th day following the date on which notice of the
date of the meeting is given to stockholders or made public, whichever first
occurs. The bylaws also specify certain requirements as to the form and
content of a stockholder's notice. These provisions may preclude stockholders
from bringing matters before an annual meeting of stockholders or from
making nominations for directors at an annual meeting of stockholders.
Authorized But Unissued Shares. The authorized but unissued shares of
common stock and preferred stock are available for future issuance without
stockholder approval. These additional shares may be utilized for a variety of
corporate purposes, including future public offerings to raise additional
capital, corporate acquisitions and employee benefit plans. The existence of
authorized but unissued shares of common stock and preferred stock could
render more difficult or discourage an attempt to obtain control of us by
means of a proxy contest, tender offer, merger or otherwise.
The Nevada Corporation Law provides generally that the affirmative vote
of a majority of the shares entitled to vote on any matter is required to amend
a corporation's certificate of incorporation or bylaws, unless a corporation's
certificate of incorporation or bylaws, as the case may be, requires a greater
percentage.
Registration Rights
After this offering, holders of the shares of common stock upon the closing
of this offering will be entitled to registration rights with respect to their
shares. Of such shares, no shares of common stock are entitled to
"piggy-back" registration rights. The holders of securities with registration
rights can require us to register all or part of their shares at any time
following six months after this offering, subject to certain conditions. In
addition, subject to certain limitations, these holders may also require us to
include their shares in future registration statements that we file and may
require us to register their shares on Form S-3.
Upon registration, such shares are freely tradable in the public market without
restriction.
Transfer Agent and Registrar
The Transfer Agent and Registrar for our common stock will be U.S. Stock
Transfer Corporation.
Application shall be made for listing the common stock on the Nasdaq
National Market under the trading symbol "VCPM."
SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of the offering, we will have shares of common
stock outstanding ( shares if the underwriters' over-allotment option is
exercised in full), assuming no exercise of options after , 2000. Of this
amount, the shares offered by this prospectus will be available for
immediate sale in the public market as of the date of this prospectus. An
additional shares are not subject to an 180-day lock- up and will be
available for sale in the public market 90 days following the date of this
prospectus pursuant to Rule 701. Approximately additional shares will be
available for sale in the public market following the expiration of 180-day
lock-up agreements with the representatives of our underwriters, subject in
some cases to compliance with the volume and other limitations of Rule 144.
Days after the Approximate Shares
Date of this Eligible for
Prospectus Future Sale Comment
-------------- ------------------ ---------------------------------------
Upon Effectiveness Freely tradable shares sold in offering
and shares salable under Rule 144(k)
that are not subject to 180-day lock-up
90 days Shares salable under Rules 144 or 701
that are not subject to 180-day lock-up
180 days Lock-up released; shares salable under
Rules 144 or 701
Over 180 days Restricted securities held for one year
or less
In general, under Rule 144 as currently in effect, a person (or persons
whose shares are aggregated) who has beneficially owned shares for at least
one
year is entitled to sell within any three-month period commencing 90 days
after
the date of this prospectus a number of shares that does not exceed the
greater
of (a) 1% of the then outstanding shares of common stock (approximately
shares immediately after the offering) or (b) the average weekly
trading volume during the four calendar weeks preceding such sale, subject
to
the filing of a Form 144 with respect to such sale. A person (or persons
whose
shares are aggregated) who is not deemed to have been an affiliate of
Venture Capital.com at any time during the 90 days immediately preceding
the sale and who has beneficially owned his or her shares for at least two
years is entitled to sell such shares pursuant to Rule 144(k) without regard to
the limitations described above. Persons deemed to be affiliates must always
sell pursuant to Rule 144, even after the applicable holding periods have been
satisfied.
We are unable to estimate the number of shares that will be sold under
Rule 144, since this will depend on the market price for our common stock,
the personal circumstances of the sellers and other factors. Prior to the
offering, there has been no public market for the common stock, and there
can be no assurance that a significant public market for the common stock
will develop or be sustained after the offering. Any future sale of substantial
amounts of the common stock in the open market may adversely affect the
market price of the common stock offered hereby.
Any of our employees or consultants who purchased his or her shares
pursuant to a written compensatory plan or contract is entitled to rely on the
resale provisions of Rule 701, which permits nonaffiliates to sell their Rule
701 shares without having to comply with the public information, holding
period, volume limitation or notice provisions of Rule 144 and permits
affiliates to sell their Rule 701 shares without having to comply with the Rule
144 holding period restrictions, in each case commencing 90 days after the
date of this prospectus. As of , the holders of options to purchase
approximately shares of common stock will be eligible to sell their
shares upon the expiration of the lock-up period, subject in certain cases to
vesting of such options.
We intend to file a registration statement on Form S-8 under the Securities
Act within days after the completion of the offering to register shares of
common stock subject to outstanding stock options reserved for issuance
under our 2000 Stock Incentive Plan, thus permitting the resale of such shares
by nonaffiliates in the public market without restriction under the Securities
Act.
In addition, certain shareholders have registration rights with respect to
shares of common stock and common stock equivalents. Registration of the
registrable securities under the Securities Act would result in such shares
becoming freely tradable without restriction under the Securities Act.
UNDERWRITING
Underwriters have not been selected or appointed as of this date.
Number
of
Underwriters Shares
- ----------
Total..........................................................
We have been advised that the underwriters propose to offer the shares of
common stock to the public at the public offering price set forth on the cover
page of this prospectus and to certain dealers at such price less a concession
of not in excess of $ per share, of which $ may be reallowed to other
dealers.
After the initial public offering, the public offering price, concession and
reallowance to dealers may be reduced by the representatives. No such
reduction shall change the amount of proceeds to be received by us as set
forth on the cover page of this prospectus.
Over-Allotment Option. We have granted to the underwriters an option,
exercisable during the 30-day period after the date of this prospectus, to
purchase up to additional shares of common stock at the same price per
share as we will receive for the shares that the underwriters have
agreed to purchase. To the extent that the underwriters exercise such option,
each of the underwriters will have a firm commitment to purchase approximately
the same percentage of such additional shares that the number of shares of
common stock to be purchased by it shown in the above table represents as
a percentage of the shares offered hereby. If purchased, such additional
shares will be sold by the underwriters on the same terms as those on which
the shares are being sold. We will be obligated, pursuant to the option, to sell
shares to the extent the option is exercised.
The underwriters may exercise such option only to cover over- allotments
made in connection with the sale of the shares of common stock offered
hereby.
The following table shows the per share and total underwriting discounts
and commissions to be paid by us to the underwriters. This information is
presented assuming either no exercise or full exercise by the underwriters of
their over-allotment option.
Per Without
With
Share Option
Option
----- -------
- ------
Public offering price................................... $ $ $
Underwriting discounts and commissions.................. $ $ $
Proceeds, before expenses, to us........................ $ $ $
The expenses of the offering are estimated at $ and are payable entirely
by us. Venture Capital.Com Inc. expects to deliver the shares of common
stock to purchasers on , 2000.
Indemnity. The underwriting agreement contains covenants of indemnity
among the underwriters and us against certain civil liabilities, including
liabilities under the Securities Act and liabilities arising from breaches of
representation and warranties contained in the underwriting agreement.
Future Sales. Each of our executive officers, directors and other
significant stockholders of record has agreed with the representatives, for a
period of 180 days after the date of this prospectus (the "Lock-Up Period"), not
to offer to
sell, contract to sell or otherwise sell, dispose of, loan, pledge or grant any
rights with respect to any shares of common stock, any options or warrants
to purchase any shares of common stock, or any securities convertible into
or exchangeable for shares of common stock owned as of the date of this
prospectus or thereafter acquired directly by such holders or with respect to
which they have or hereafter acquire the power of disposition, without the
prior written consent of the underwriter to be appointed. However, the
underwriter may, in its sole discretion and at any time without notice, release
all or any portion of the securities subject to lock-up agreements. There are
no agreements between the representatives and any of our stockholders
providing consent by the representatives to the sale of shares prior to the
expiration of the Lock-Up Period. In addition, we have agreed that, during the
Lock-Up Period, we will not, subject to certain exceptions, without the prior
written consent of the appointed underwriter, (a) consent to the disposition
of any shares held by stockholders prior to the expiration of the Lock-Up
Period or (b) issue, sell, contract to sell or otherwise dispose of, any shares
of common stock, any options or warrants to purchase any shares of common
stock, or any securities convertible into, exercisable for or exchangeable for
shares of common stock, other than our sale of shares in the offering, our
issuance of common stock upon the exercise of currently outstanding options
and warrants, and our issuance of incentive awards under our stock incentive
plans. See "Shares Eligible for Future Sale."
Directed Shares. At our request, the underwriters have reserved up to
shares of common stock for sale, at the initial public offering price, to our
employees, business associates and other friends through a directed share
program. The number of shares of common stock available for sale to the
general public in the offering will be reduced to the extent participants in the
directed share program purchase the reserved shares.
The underwriters do not intend to confirm sales to any accounts over which
they exercise discretionary authority.
No Prior Public Market. Prior to this offering, there has been no public
market for the common stock. Consequently, the initial public offering price
for the common stock offered hereby has been determined through
negotiations between us and the representatives. Among the factors
considered in such negotiations were prevailing market conditions, our
financial information, market valuations of other companies that we and the
representatives believe to be comparable to us, estimates of our business
potential, the present state of our development and other factors deemed
relevant.
The underwriter appointed will not have any material relationship with us or
any of our officers, directors or other controlling persons, except with respect
to its contractual relationship with us pursuant to the underwriting agreement
entered into in connection with this offering.
Stabilization. The representatives have advised us that, pursuant to
Regulation M under the Securities Exchange Act, certain persons
participating in the offering may engage in transactions, including stabilizing
bids, syndicate covering transactions or the imposition of penalty bids, that
may have the effect of stabilizing or maintaining the market price of the
common stock at a level above that which might otherwise prevail in the
open market. A "stabilizing bid" is a bid for or the purchase of the common
stock on behalf of the underwriters for the purpose of fixing or maintaining
the price of the common stock. A "syndicate covering transaction" is the bid
for or purchase of the common stock on behalf of the underwriters to reduce
a short position incurred by the underwriters in connection with the offering.
A "penalty bid" is an arrangement permitting the representatives to reclaim
the selling concession otherwise accruing to an underwriter or syndicate
member in connection with the offering if the common stock originally sold
by such underwriter or syndicate member is purchased by the representatives
in a syndicate covering transaction and has therefore not been effectively
placed by such underwriter or syndicate member.
The representatives have advised us that such transactions may be effected
on the Nasdaq National Market or otherwise and, if commenced, may be
discontinued at any time.
EXPERTS
No experts have been selected or appointed at this time and will be selected
when necessary.
ADDITIONAL INFORMATION
We have filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (including the exhibits
and schedules thereto) under the Securities Act with respect to the shares to
be sold in the offering. This prospectus does not contain all the information
set forth in the registration statement. For further information with respect to
us and the shares to be sold in the offering, reference is made to the
registration statement. Statements contained in this prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete, and in each instance reference is made to the copy of
such contract, agreement or other document filed as an exhibit to the
registration statement, each such statement being qualified in all respects by
such reference. In addition, we intend to file annual, quarterly and current
reports, proxy statements and other information with the Commission.
You may read and copy all or any portion of the registration statement or
any reports, statements or other information that we file at the Commission's
public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549.
You can request copies of these documents, upon payment of a duplicating
fee, by writing to the Commission. Please call the Commission at
1-800-SEC-0330 for
further information on the operation of the public reference rooms. Our
Commission filings, including the registration statement, are also available
to you on the Commission's Web site (http://www.sec.gov).
VENTURE CAPITAL.COM INCORPORATED
(A DEVELOPMENT STAGE COMPANY)
INDEX TO FINANCIAL STATEMENTS
Page
----
Balance Sheet..........................................................F-1
Statements of Operations for the period from December 20, 1999..........F-2
(date of inception) to December 31, 1999,
Statements of Stockholders' Equity for the period from..................F-3
December 20, 1999 (date of inception) through December 31, 1999
(unaudited
Statements of Cash Flows for the period from December 20, 1999.........F-4
(date of inception) to December 31, 1999,
Notes To Financial
Statements.............................................................. ...F-5
REPORT OF ACCOUNTANTS January 28, 1999
We have examined the balance sheets, financial statement, statement of
operations and statement of stockholders' equity. The Company has no
assets, no liabilities, no operations and no stockholders at this time.
William Querin, CPA
F-1 VENTURE CAPITAL.COM INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
December 31, 1999
December Pro Forma
31, 1999 Historical (Note 1)
----------- -----------
- -----
(unaudited)
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents............. $ --
Prepaid expenses...................... --
----------- -----------
- -----------
Total current assets.................... --
Property and equipment, net............. --
Patents, trademarks and other
intangibles, net...................... --
Other...................................
----------- -----------
- -----------
Total assets............................ $ -0-
=========== ===========
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Line of credit........................ $ -0-
Accounts payable...................... -0-
Accrued expenses...................... -0-
Accrued payroll and related........... -0-
Accrued professional.................. -0- --
Current portion of capital lease
obligations.........................
----------- -----------
- -----------
Total current liabilities...............-0-
Capital lease obligations, less current
portion............................... -0-
Commitments
Stockholders' equity:
Preferred stock, $.001 par value
(Series A, B & C):.......................-0-
Authorized shares at
December 31, 1999 ...................-0-
Issued and outstanding shares -0-
Pro forma: none)
Liquidation preference of $
at December 31, 1999
$ -0-, 1999 (pro forma: none)....................... -0- --
Common stock, $.001 par value:
Authorized shares 25,000,000 at
December 31, 1999 and ..............................-0-
Issued and outstanding shares
-0- at December 31, 1999
(pro forma: ..................................-0-
Additional paid-in capital............ -0-
Notes receivable from stock sales..... -0-
Deficit accumulated during the
development stage................... -0-
----------- -----------
- -----------
Total stockholders' equity..............-0-
----------- -----------
- -----------
Total liabilities and stockholders'
equity................................ $ -0-
=========== ===========
===========
F-2
VENTURE CAPITAL.COM INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
Period from
December 20, 1999 Period from
Priod from
(date of inception)
to
December 31, 1999
------------------- ------------------- --------------
- -------------------
(unaudited) (unaudited)
(unaudited)
Revenues................ $ -- $ -- $ --
$ --
Costs and expenses:
Research and
development......... -0-
General and
administrative...... -0-
----------- --------- -----------
-----------
Total costs and
expense..........-0-
----------- --------- -----------
-----------
Loss from operations.... -0-
Other income (expense):
Interest expense...... -0-
Interest income.......
----------- --------- -----------
-----------
Net loss................ $ -0-
=========== ========= ===========
Historical basic and
diluted net loss per
share................. $ -0- $
Pro forma basic and
diluted net loss per
share................. $ -0-
F-3
VENTURE CAPITAL.COM INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF STOCKHOLDERS' EQUITY
Deficit
Preferred Stock Notes
Accumulated (Series A, B & C) Common Stock Additional Receivable
During the
Paid-in from
The Development
Stage
Shares Amount Shares Amount Capital
Stock Sales
Total
---------- ----------- --------- ------ ----------
- ----------- -----------
Balance at December 20,
1999 (inception)...... -- $ -- -- $ -- $ -- $ --
$ -- $
Issuance of Common
Stock................. -- --
Issuance of Series A
Preferred Stock, net
of offering costs, at
$0.00 a share......... -0-
Issuance of Series B
Preferred Stock at
$0.00 a share......... -0-
Issuance of restricted
Common Stock.......... -- --
Net loss............... -- -- -- -- --
--
----------- --------- ------ -------- ---------
- ----------- -----------
Balance at December 20,
1999................... -0-
Issuance of Series C
Preferred Stock, net
of offering costs, at
$0.00 a share
(unaudited)...........
Net loss (unaudited).... -- -- -- -- --
--
---------- ----------- --------- ------ --------
- --------- ----------
Balance at December 20,
1999 (unaudited)............ -0-
========== =========== ========= ====== ======
F-4
VENTURE CAPITAL.COM INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
Period from
December 20, 1999
(date
of
inception)
to December
31, 1999
----------- ------------- -----------
- -------------
----------- ------------- -----------
- -------------
Operating activities:
Net loss............... $ -0-
Adjustments to
reconcile net loss
to net cash used in
operating
activities:
Depreciation and
amortization...... -0-
Changes in operating
assets and
liabilities:
Prepaid expenses.. -0-
Accounts payable.. -0-
Accrued expenses.. -0-
----------- ---------- -----------
- -----------
Net cash used in
operations activities.. -0-
Investing activities:
Capital expenditures... -0-
Other.................. -0-
----------- ---------- -----------
- -----------
Net cash used in
investing activities... -0-
Financing activities:
Net proceeds from line
of credit............ -0-
Repayment of capital
lease obligations.... -0-
Issuance of Series A
Preferred Stock,
net..................-0-
Issuance of Series B
Preferred Stock......-0-
Issuance of Series C
Preferred Stock,
net.................. -- --
Issuance of Common
Stock................ -0-
----------- ---------- -----------
- -----------
Net cash provided by
financing activities... -0-
----------- ---------- -----------
- -----------
Net increase in cash and
cash equivalents....... -0-
Cash and cash equivalents
at beginning of
period................. -- -- -0- --
----------- ---------- -----------
- -----------
Cash and cash equivalents
at end of period....... $ -0-
========= ========== =========== ======
Supplemental cash flow
disclosure:............
Cash paid for:
Interest............... $ -0-
Income taxes........... $ -0-
Noncash investing and
financial activity:
Issuance of common
stock in exchange
for a patent and a
trademark name....... $ -0-
Equipment acquired
under capital
lease................ $ -0-
Issuance of notes
receivable from
stock sales.......... $ -0-
F-5
VENTURE CAPITAL.COM INC.
NOTES TO FINANCIAL STATEMENTS
Description of Business and Basis of Presentation
Venture Capital.com Inc. (Venture Capital.com Inc. or the Company), Inc.,
was incorporated in Nevada on December 20, 1999, and is a development
stage company. The Company has conducted no business as of this date. The
Company has no assets and no liabilities.
The Company is subject to the normal risks associated with a development
stage enterprise in the technology industry.
These risks include, among others, the risks associated with product
development and acceptance of the product by end users and the ability to
raise additional capital to commence and sustain operations.
Concentration of Risk
The financial instrument that potentially exposes the Company to
concentrations of credit risks consists primarily of cash equivalents. The
Company places its cash equivalents with high quality financial institutions.
At times, such balances may be in excess of the FDIC insurance limit.
VENTURE CAPITAL.COM INC.
NOTES TO FINANCIAL STATEMENTS--(Continued)
Computation of Historical Net Loss per Share and Pro Forma Net Loss Per
Share In accordance with Statement of Financial Accounting Standards
(SFAS) No. 128, "Computation of Earnings Per Share," basic earnings per
share is computed by dividing the net earnings available to common
stockholders for the period by the weighted average number of common
shares outstanding during the period. Diluted earnings per share is computed
by dividing the net earnings for the period by the weighted average number
of common and common equivalent shares outstanding during the period.
Common equivalent shares, consisting of unvested restricted Common Stock
and incremental common shares issuable upon the exercise of stock options
and warrants and upon conversion of convertible preferred stock, are
excluded from the diluted earnings per share calculation if their effect is
anti-dilutive.
A summary of the shares used to compute earnings per share is as follows:
Period from January Period from
Period
from
(date of inception) (date of inception)
Three Months
(date of inception)
to to Ended
to
------------------- ------------------- --------------
- -------------------
(unaudited) (unaudited)
(unaudited)
Weighted average common
shares used to compute
basic net loss per
share..................-0-
Effect of Dilutive
securities............. -- --
- -- --
--------- ---------
- ---------- ---------
Weighted average common
shares used to compute
dilutive net loss per
share.................. -0-
========= =========
==========
=========
Conversion of preferred
stock.................. -0-
--------- ---------
- ---------- ---------
Weighted average common
shares used to compute
pro forma basic and
diluted net loss per
share..................
========= ========= ==========
=====
Pro forma net loss per share is computed using the weighted average
number of common shares outstanding, including the pro forma effects of the
automatic conversion of the Company's Series A, B and C Preferred Stock
into shares of the Company's Common Stock effective upon the closing of the
Company's Initial Public Offering as if such conversion occurred at inception
or the date of original issuance, if later. Pro forma diluted earnings per share
is computed using the pro forma weighted average number of common and
common equivalents shares outstanding during the period, to the extent such
shares are dilutive.
Property and Equipment
Property and equipment are stated at cost. Depreciation and amortization
is computed principally on a straight-line method over the estimated useful
lives of the assets ranging from three to five years. Assets acquired under
capitalized lease arrangements are recorded at the present value of the
minimum lease payments. Amortization of assets capitalized under capital
leases is computed using the straight-line method over the life of the asset or
term of the lease, whichever is shorter. Expenditures for repairs and
maintenance are charged to expense as incurred.
Patents, Trademarks and Other Intangibles
Patents, trademarks and other intangibles are carried at cost less
accumulated amortization that is calculated on a straight-line basis over the
estimated useful lives of the assets, not to exceed 40 years. Patents are
currently amortized over an estimated useful live of 17 years. Trademarks and
other intangibles have useful lives that range from 5 to 15 years.
Accumulated amortization as of December 31, 1998 is $-0- at this time.
VENTURE CAPITAL.COM INC.
NOTES TO FINANCIAL STATEMENTS--(Continued)
Income Taxes
The Company accounts for income taxes in accordance with FASB 109,
"Accounting for Income Taxes." Under this method, deferred tax liabilities
and assets are determined based on the difference between the financial
statements and the tax basis of assets and liabilities using the enacted tax
rate in effect for the years in which the differences are expected to reverse.
Research and Development Costs
Research and development costs are expensed as incurred. These costs
primarily consist of salaries, development materials, supplies and applicable
overhead expenses of personnel directly involved in the research and
development of new technology and products.
Stock-Based Compensation
SFAS No. 123, "Accounting for Stock-Based Compensation" (SFAS 123)
encourages, but does not require, companies to record compensation cost for
stock-based employee compensation plans at fair value. The Company has
chosen to continue to account for stock-based compensation using the
intrinsic-value method prescribed in
Accounting Principles Board Opinion No. 25, "Accounting or Stock Issued
to Employees."
The provision for income taxes consists solely of minimum state taxes.
The Company's effective tax rate differs from the statutory federal income tax
rate primarily as a result of the establishment of a valuation allowance for the
future benefits to be received from the net operating loss carryforwards and
research tax credit carryforwards. The tax effect of temporary differences
that
give rise to a significant portion of the deferred tax assets and liabilities at
December 31, 1999 are presented below.
Deferred tax assets (liabilities):
Net operating loss carryforwards............................. $ -0-
Research credits.............................................
Depreciation.................................................
Capitalized start-up costs...................................
Accruals.....................................................
- -----------
Total deferred tax assets...................................... -0-
Valuation allowance............................................ -0-
- -----------
Net deferred tax assets........................................ $ --
===========
Capital Leases, Commitments and Contingencies
The Company has no capital leases, commitments or contingencies at this
time. The present facility is provided by James D. Martin at no cost to the
Company at this time.
The following tabulation summarizes certain information related to options
for common stock:
Weighted
Average
Number of
Exercise
Shares Price
---------
- --------
Outstanding options at December 31, 1999..........-0- -- $ --
Grants...................................................-0-
Surrendered, forfeited or expired........................-0-
Exercised................................................ -- --
Outstanding options at December 31, 1999.................-0-
========= ====
Pro forma information regarding net loss is required by SFAS 123, and has
been determined as if the Company had accounted for its employee stock
options under the fair-value method of that statement. The fair value for these
options was estimated at the date of grant using the minimum-value method,
which utilizes a near-zero volatility factor. The remaining assumptions,
which are weighted average, under this method are as follows:
Expected life (years).............................................
5
Risk-free interest rate...........................................
5.50%
Dividend yield....................................................
- --
This option-valuation method requires input of highly subjective
assumptions. Because the Company's employee stock options have
characteristics significantly different from those of traded options, and
because change in the subjective input assumptions can materially affect the
fair value estimate, in management's opinion, the existing method does not
necessarily provide a reliable single measure of the fair value of its employee
stock options.
The effects of applying SFAS 123 in this pro forma disclosure are not
indicative of future amounts and additional awards in future years are
anticipated.
If the Company recognized employee stock related compensation expense
in accordance with SFAS 123 under the minimum value method, any net loss
for 1999 would not be materially different.
Equity
Since there has been no stock issued as of this date there is no stockholder
equity.
VENTURE CAPITAL.COM INC.
NOTES TO FINANCIAL STATEMENTS--(Continued)
Public offering price of $ per share and net proceeds of $ or (ii) written
consent of the majority holders of outstanding shares of Common Stock
Authorize Stock
The Company is authorized to issue 25,000,000 shares of common stock
at par value of $0.001 per share under the original Articles of Incorporation
filed in the State of Nevada on December 20, 1999
Preferred Stock
There is no provision for preferred stock at this time.
VENTURE CAPITAL.COM INC.
NOTES TO FINANCIAL STATEMENTS--(Continued)
Stock options
The Company has issued no stock options at this time/
Exercise
Estimated
Number of options Price Fair
Value
----------------- --------
- ----------
-0-
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable in connection with the sale
and distribution of the securities being registered. All amounts are estimated
except the Securities and Exchange Commission and NASD. All of the
expenses below will be paid by the Company.
Item
----
Registration fee.................................................... 264.00
NASD filing fee.....................................................
Nasdaq National Market listing fee..................................
Blue sky fees and expenses..........................................
Printing and engraving expenses...............................5,000.
Legal fees and expenses.............................................
Accounting fees and expenses........................................
Transfer Agent and Registrar fees...................................
5,000
Miscellaneous....................................................... 30,000
Total.............................................................
40,264
Item 14. Indemnification of Directors and Officers.
The Company's corporate bylaws (the "bylaws") provide that, except to the
extent prohibited by the Nevada Corporation Law (the "NCL"), the
Company's directors shall not be personally liable to the Company or its
stockholders for monetary damages for any breach of fiduciary duty as
directors of the Company. Under the NCL, the directors have a fiduciary duty
to the Company which is not eliminated by this provision of the bylaws and,
in appropriate circumstances, equitable remedies such as injunctive or other
forms of nonmonetary relief will remain available. In addition, each director
will continue to be subject to liability under the NCL for breach of the
director's duty of loyalty to the Company, for acts or omissions which are
found by a court of competent jurisdiction to be not in good faith or involving
intentional misconduct, for knowing violations of law, for actions leading to
improper personal benefit to the director, and for payment of dividends or
approval of stock repurchases or redemptions that are prohibited by NCL.
This provision also does not affect the directors' responsibilities under any
other laws, such as the federal securities laws or state or federal
environmental laws. The Company shall obtain liability insurance for its
officers and directors.
The NCL empowers a corporation to indemnify its directors and officers and
to purchase insurance with respect to liability arising out of their capacity or
status as directors and officers, provided that this provision shall not
eliminate or limit the liability of a director: (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) arising under the NCL, or (iv) for any
transaction from which the director derived an improper personal benefit. The
NCL provides further that the indemnification permitted thereunder shall not be
deemed exclusive of any other rights to which the directors and officers may be
entitled under the corporation's bylaws, any agreement, a vote of stockholders
or otherwise. The bylaws eliminate the personal liability of directors to the
fullest extent permitted by the NCL and provides that the Company shall
fully 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) by reason of the fact
that such person is or was a director or officer of the Company, or is or was
serving at the request of the Company as a director or officer of another
corporation, partnership joint venture, trust, employee benefit plan or other
enterprise, against expenses (including attorney's fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding.
The Company, with the approval of the Board of Directors, intends to
obtain directors' and officers' liability insurance prior to the effectiveness
of this offering. In addition, the Company intends to enter into indemnification
agreements with each of its directors and executive officers.
There is no pending litigation or proceeding involving any director,
officer, employee or agent of the Company in which indemnification will be
required or permitted. Moreover, the Company is not aware of any threatened
litigation or proceeding that might result in a claim for such
indemnification.
The Company believes that the foregoing indemnification provisions and
agreements are necessary to attract and retain qualified persons as directors
and executive officers.
The Underwriting Agreement shall provide for indemnification by the
Underwriters of the Company and its officers and directors, and by the
Company of the Underwriters, for certain liabilities arising under the
Securities Act or otherwise.
Recent Sales of Unregistered Securities.
The Company has not sold any securities as of this date.
The following Exhibits are attached hereto and incorporated herein by
reference:
Exhibit
Number Description
------- -----------
1.1* Form of Underwriting Agreement. There has been no underwriter
selected or appointed at this time. The Underwriting Agreement shall be
submitted as it is available.
1.2* Specimen Stock Certificate.
* To be submitted later by mail.
All such Schedules have been omitted because the information required to
be set forth therein is not applicable or is shown in the financial statements
or notes thereto.
Item 17. Undertakings.
The undersigned Company hereby undertakes to provide to the
Underwriters at the closing specified in the Underwriting Agreements,
certificates in such denominations and registered in such names as required
by the Underwriters to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities
Act of
1933 may be permitted to directors, officers and controlling persons of the
Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Company of expenses incurred or paid by a director, officer or controlling
person of the Company in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Company will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
The undersigned Company hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus as filed as
part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by us pursuant to Rule 424(b)(1)
or (4) or 497(h) under the Securities Act shall be deemed to be part of
this Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, we have duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Reno, State of Nevada,
on the 31st day of December 1999.
VENTURE CAPITAL.COM INC.
By: /s/ James D. Martin
- -----------------------------------
James D. Martin
KNOW ALL MEN BY THESE PRESENTS, the undersigned hereby
constitute and appoint James D. Martin, his true and lawful attorney-in-fact
and agent, each with full power of substitution and resubstitution, for him and
in his name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration
Statement, or any related registration statement filed pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with exhibits thereto,
and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and perform each and every act
and thing requisite or necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that each of said attorneys- in-fact and agents, or his
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement on Form S-1 has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title
Date
--------- ----- ----
/s/ James D. Martin Chief Executive Officer, December 31, 1999
____________________________________ President and Director
James D. Martin (Principal Executive Officer)
EXHIBIT INDEX
Exhibit
Number Description
------- -----------
1.1* Form of Underwriting Agreement.
2.1 Certificate of Incorporation of the Registrant.
3.1 Accountant's Statement
4.1 Bylaws of the Registrant.
5.1* Specimen Stock Certificate
* To be submitted later by mail
EXHIBIT 2.1
CERTIFICATE OF INCORPORATION
OF
VENTURE CAPITAL.COM INC.
The undersigned, James D. Martin, hereby certifies that:
1. They are he is the duly elected and acting President and Secretary,
respectively, of Venture Capital.com Inc., a Nevada corporation.
2. The Certificate of Incorporation of this corporation was originally
filed with the Secretary of State of Nevada on December 20, 1999.
3. The Certificate of Incorporation of this corporation is as follows:
ARTICLE 1
The name of this corporation is Venture Capital.com Inccorporated (the
"Corporation").
-----------
ARTICLE 2
The address of the Corporation's registered office in the State of Nevada
is 6015 South Virginia Street, Suite 421, Reno, Nevada 89502. The name of
its
registered agent at such address is James D. Martin.
ARTICLE 3
The total number of shares which the Corporation is authorized to issue is
Twenty Five Million (25,000,000) shares, each with a par value of $0.001 per
share.
ARTICLE 4
The governing board shall be as directors. The first Board of Directors
shall consist of one member whose name and address is as follows; James D.
Martin, 6015 South Virginia Street, Suite 421, Reno, Nevada 89502.
ARTICLE 5
The purpose of this Corporation is to engage in Venture Capital,
Investments, Financial Services and Business Services.
ARTICLE 6
Other Matters: The number of attached pages is -0-
ARTICLE 7
The Name, Address and signatures of the Incorporators are:
James D. Martin
6015 South Virginia Street, Suite 421
Reno, Nevada 89502
ARTICLE 8
Certificate of Acceptance of Appointment of Registered Agent:
I, James D. Martin hereby accept appointment as Registered Agent for the
above named corporation.
/s/ James D. Martin Dated: November
18, 1999
James D. Martin
Executed at Citrus Heights, California on November 18, 1999.
/s/ James D. Martin
- ------------------------------------------
James D. Martin, President
EXHIBIT 3.1
Accountant's Statement
December 28, 1999
Subject: Venture Capital.Com, Incorporated
I have examined the Financial Statements and Operating Statements of
Venture Capital. Com, Incorporated which was incorporated in the State of
Nevada in December of 1999.
The subject Corporation has no assets or liabilities. In addition the subject
Corporation appears to have no operating history.
William Querin, CPA
Page
- ----
ARTICLE I - CORPORATE
OFFICES........................................................1
1.1 Registered Office.....................................1
1.2 Other Offices.........................................1
ARTICLE II - MEETINGS OF STOCKHOLDERS..........................1
2.1 Place Of Meetings.....................................1
2.2 Annual Meeting........................................1
2.3 Special Meeting.......................................1
2.4 Notice Of Stockholders'
Meetings..............................................2
2.5 Business Limited To Notice Content....................2
2.6 Quorum................................................2
2.7 Majority Voting Power.................................3
2.8 Voting................................................3
2.9 Proxies...............................................3
2.10 Stockholder Action By Written Consent Without A Meeting........4
2.12 Record Date For Stockholder Notice; Voting; Giving Consents.....4
ARTICLE III - DIRECTORS...................................................4
3.1 Number Of Directors..............................................4
3.2 Vacancies....................................................... 4
3.3 Management By Directors..........................................4
3.4 Meetings Of The Board Of
Directors........................................................5
3.5 First Meeting....................................................5
3.6 Regular Meetings.................................................5
3.7 Special Meetings;
Notice...........................................................5
3.8 Quorum...........................................................5
3.9 Committees.......................................................6
3.10 Minutes Of Committees...........................................6
3.11 Fees And Compensation Of Directors..............................6
ARTICLE IV -NOTICES.......................................................6
4.1 Notices To Directors And Stockholders............................6
4.2 Voting At
Meetings........................................................ 7
4.3 Notices..........................................................7
ARTICLE V - OFFICERS......................................................7
5.1 Officers.........................................................7
5.2 Appointment Of Officers..........................................7
5.3 Subordinate Officers.............................................7
5.4 Salaries Of Officers And Agents..................................8
5.5 Removal And Resignation Of Officers..............................8
5.5 Vacancies In Offices.............................................8
5.6 President And Chief Executive Officer............................8
5.7 Execution Of Corporate Documents And Instruments........8
5.8 Vice Presidents..................................................8
5.9 Secretary........................................................9
5.10 Treasurer.......................................................9
5.11 Disbursement Of Funds...........................................9
5.12 Treasurer's Bond................................................9
ARTICLE VI - CERTIFICATES OF STOCK.......................................10
6.1 Stock Certificates..............................................10
6.2 Authentication Of Stock Certificates............................10
6.3 Lost Stock Certificates.........................................11
6.4 Transfer Of Stock...............................................11
6.5 Closing Of Transfer Books.......................................11
6.6 Registered Stockholders.........................................12
ARTICLE VII - GENERAL PROVISIONS DIVIDENDS...............................12
7.1 Dividends.......................................................12
7.2 Payment Of Dividends............................................12
7.3 Checks..........................................................13
7.4 Fiscal Year.....................................................13
7.5 Corporate Seal..................................................13
ARTICLE VIII - AMENDMENTS................................................13
8.1 Amendments.....................................................13
SIGNATURE PAGE...........................................................14
VENTURE CAPITAL.COM, INCORPORATED
ITEM 4.1 * * * * *
BY-LAWS
* * * * *
ARTICLE I
OFFICES
Section 1. The registered office shall be in Reno, Nevada.
Section 2. The corporation may also have offices at such other
places both within and without the State of Nevada as the board of
directors may from time to time determine or the business of the
corporation may require.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. All annual meetings of the stockholders shall be
held in the City of Reno, State of Nevada. Special meetings of the
stockholders may be held at such time and place within or without the
State of Nevada as shall be stated in the notice of the meeting, or in a
duly executed waiver of notice thereof.
Section 2. Annual meetings of stockholders, commencing with
the year 2000, shall be held on June 15th , if not a legal holiday, and if
a legal holiday, then on the next secular day following, at 12:00 Noon,
at which they shall elect by a plurality vote a board of directors, and
transact such other business as may properly be brought before the
meeting.
Section 3. Special meetings of the stockholders, for any
purpose or purposes, unless otherwise prescribed by statute or by the
articles of incorporation, may be called by the president and shall be
called by the president or secretary at the request in writing of a
majority of the board of directors, or at the request in writing of
stockholders owning a majority in amount of the entire capital stock
of the corporation issued and outstanding and entitled to vote. Such
request shall state the purpose or purposes of the proposed meeting.
Section 4. Notices of meetings shall be in writing and signed
by the president or a vice president, or the secretary, or an assistant
secretary, or by such other person or persons as the directors shall
designate. Such notice shall state the purpose or purposes for which
the meeting is called and the time when and the place where it is to be
held. A copy of such notice shall be either delivered personally to or
shall be mailed, postage prepaid, to each stockholder of record
entitled to vote at such meeting not less than ten nor more than sixty
days before such meeting.
If mailed, it shall be directed to a stockholder at his address as it
appears upon the records of the corporation and upon such mailing of
any such notice, the service thereof shall be complete, and the time of
the notice shall begin to run from the date upon which such notice is
deposited in the mail for transmission to such stockholder. Personal
delivery of any such notice to any officer of a corporation or
association, or to any member of a partnership shall constitute
delivery of such notice to such corporation, association or
partnership. In the event of the transfer of stock after delivery or
mailing of the notice of and prior to the holding of the meeting it shall
not be necessary to deliver or mail notice of the meeting to the
transferee.
Section 5. Business transacted at any special meeting of
stockholders shall be limited to the purposes stated in the notice.
Section 6. The holders of a majority of the stock issued and
outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business except as otherwise
provided by statute or by the articles of incorporation. If, however,
such quorum shall not be present or represented at any meeting of the
stockholders, the stockholders entitled to vote thereat, present in
person or represented by proxy, shall have power to adjourn the
meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall be present or represented. At such
adjourned meeting at which a quorum shall be present or
represented, any business may be transacted which might have been
transacted at the meeting as originally notified.
Section 7. When a quorum is present or represented at any
meeting, the vote of the holders of a majority of the stock having
voting power present in person or represented by proxy shall decide
any question brought before such meeting, unless the question is one
upon which by express provision of the statutes or of the articles of
incorporation a different vote is required in which case such express
provision shall govern and control the decision of such question.
Section 8. Except as hereinafter provided, every stockholder of
record of the corporation shall be entitled at each meeting of
stockholders to one vote for each share of stock standing in his name
on the books of the corporation. At all elections of directors each
holder of stock possessing voting power shall be entitled to as many
votes as shall equal the number of his shares of stock multiplied by the
number of directors to be elected, and he may cast all of such votes for
a single director or may distribute them among the number to be
voted for or any two or more of them, as he may see fit.
Section 9. At any meeting of the stockholders, any stockholder
may be represented and vote by a proxy or proxies appointed by an
instrument in writing. In the event that any such instrument in
writing shall designate two or more persons to act as proxies, a
majority of such persons present at the meeting, or, if only one shall
be present, then that one shall have and may exercise all of the powers
conferred by such written instrument upon all of the persons so
designated unless the instrument shall otherwise provide. No such
proxy shall be valid after the expiration of six months from the date of
its execution, unless coupled with an interest, or unless the person
executing it specifies therein the length of time for which it is to
continue in force, which in no case shall exceed seven years from the
date of its execution. Subject to the above, any proxy duly executed is
not revoked and continues in full force and effect until an instrument
revoking it or a duly executed proxy bearing a later date is filed with
the secretary of the corporation.
Section 10. Any action, which may be taken by the vote of the
stockholders at a meeting, may be taken without a meeting if
authorized by the written consent of stockholders holding at least a
majority of the voting power, unless the provisions of the statutes or
of the articles of incorporation require a greater proportion of voting
power to authorize such action in which case such greater proportion
of written consents shall be required.
ARTICLE III
DIRECTORS
Section 1. The number of directors shall be neither more than
twenty Directors nor less than one of Director. The number of
directors is to be fixed by vote of the shareholders. The directors shall
be elected at the annual meeting of the stockholders, and except as
provided in Section 2 of this article, each director elected shall hold
office until his successor is elected and qualified. Directors need not be
stockholders.
Section 2. Vacancies, including those caused by an increase in
the number of directors, may be filled by a majority of the remaining
directors though less than a quorum. When one or more directors
shall give notice of his or their resignation to the board, effective at a
future date, the board shall have power to fill such vacancy or
vacancies to take effect when such resignation or resignations shall
become effective, each director so appointed to hold office during the
remainder of the term of office of the resigning director or directors.
Section 3. The business of the corporation shall be managed
by its board of directors which may exercise all such powers of the
corporation and do all such lawful acts and things as are not by
statute or by the articles of incorporation or by these by-laws directed
or required to be exercised or done by the stockholders.
MEETINGS OF THE BOARD OF DIRECTORS
Section 4. The board of directors of the corporation may hold
meetings, both regular and special, either within or without the State
of Nevada.
Section 5. The first meeting of each newly elected board of
directors shall be held at such time and place as shall be fixed by the
vote of the stockholders at the annual meeting and no notice of such
meeting shall be necessary to the newly elected directors in order
legally to constitute the meeting, provided a quorum shall be present.
In the event of the failure of the stockholders to fix the time or place
of such first meeting of the newly elected board of directors, or in the
event such meeting is not held at the time and place so fixed by the
stockholders, the meeting may be held at such time and place as shall
be specified in a notice given as hereinafter provided for special
meetings of the board of directors, or as shall be specified in a written
waiver signed by all of the directors.
Section 6. Regular meetings of the board of directors may be
held without notice at such time and place as shall from time to time
be determined by the board.
Section 7. Special meetings of the board of directors may be
called by the president or secretary on the written request of two
directors. Written notice of special meetings of the board of directors
shall be given to each director at least ten (10) days before the data of
the meeting.
Section 8. A majority of the board of directors, at a meeting
duly assembled, shall be necessary to constitute a quorum for the
transaction of business and the act of a majority of the directors
present at any meeting at which a quorum is present shall be the act
of the board of directors, except as may be otherwise specifically
provided by statute or by the articles of incorporation. Any action
required or permitted to be taken at a meeting of the directors may be
taken without a meeting if a consent in writing, setting forth the
action so taken, shall be signed by all of the directors entitled to vote
with respect to the subject matter thereof.
COMMLTTEES OF DIRECTORS
Section 9. The board of directors may, by resolution passed by
a majority of the whole board, designate one or more committees,
each committee to consist of one or more of the directors of the
corporation, which, to the extent provided in the resolution, shall have
and may exercise the powers of the board of directors in the
management of the business and affairs of the corporation, and may
have power to authorize the seal of the corporation to be affixed to all
papers on which the corporation desires to place a seal.
Such committee or committees shall have such name or names as may
be determined from time to time by resolution adopted by the board
of directors.
Section 10. The committees shall keep regular minutes of their
proceedings and report the same to the board when required.
COMPENSATION OF DIRECTORS
Section 11. The directors may be paid their expenses, if any, of
attendance at each meeting of the board of directors and may be paid
a fixed sum for attendance at each meeting of the board of directors
or a stated salary as director. No such payment shall preclude any
director from serving the corporation in any other capacity and
receiving compensation therefor. Members of special or standing
committees may be allowed like compensation for attending
committee meetings.
ARTICLE IV
NOTICES
Section 1. Notices to directors and stockholders shall be in
writing and delivered personally or mailed to the directors or
stockholders at their addresses appearing on the books of the
corporation. Notice by mail shall be deemed to be given at the time
when the same shall be mailed. Notice to directors may also be given
by facsimile telecommunication.
Section 2. Whenever all parties entitled to vote at any meeting,
whether of directors or stockholders, consent, either by a writing on
the records of the meeting or filed with the secretary, or by presence
at such meeting and oral consent entered on the minutes, or by taking
part in the deliberations at such meeting without objection, the doings
of such meeting shall be as valid as if had at a meeting regularly called
and noticed, and at such meeting any business may be transacted
which is not excepted from the written consent or to the consideration
of which no objection for want of notice is made at the time, and if
any meeting be irregular for want of notice or of such consent,
provided a quorum was present at such meeting, the proceedings of
said meeting may be ratified and approved and rendered likewise
valid and the irregularity or defect therein waived by a writing signed
by all parties having the right to vote at such meetings; and such
consent or approval of stockholders may be by proxy or attorney, but
all such proxies and powers of attorney must be in writing.
Section 3. Whenever any notice whatever is required to be given
under the provisions of the statutes, of the articles of incorporation or
of these by-laws, a waiver thereof in writing, signed by the person or
persons entitled to said notice, whether before or after the time stated
therein shall be deemed equivalent thereto.
ARTICLE V
OFFICERS
Section 1. The officers of the corporation shall be chosen by
the board of directors and shall be a president, a vice president, a
secretary and a treasurer. Any person may hold two or more offices.
Section 2. The board of directors at its first meeting after each
annual meeting of stockholders shall choose a president, a vice
president, a secretary and a treasurer, none of whom need be a
member of the board.
Section 3. The board of directors may appoint additional vice
presidents, and assistant secretaries and assistant treasurers and such
other officers and agents as it shall deem necessary who shall hold
their offices for such terms and shall exercise such powers and
perform such duties as shall be determined from time to time by the
board.
Section 4. The salaries of all officers and agents of the
corporation shall be fixed by the board of directors.
Section 5. The officers of the corporation shall hold office until
their successors are chosen and qualify. Any officer elected or
appointed by the board of directors may be removed at any time by
the affirmative vote of a majority of the board of directors. Any
vacancy occurring in any office of the corporation by death,
resignation, removal or otherwise shall be filled by the board of
directors.
THE PRESIDENT
Section 6. The president shall be the chief executive officer of
the corporation, shall preside at all meetings of the stockholders and
the board of directors, shall have general and active management of
the business of the corporation, and shall see that all orders and
resolutions of the board of directors are carried into effect.
Section 7. He shall execute bonds, mortgages and other
contracts requiring a seal, under the seal of the corporation, except
where required or permitted by law to be otherwise signed and
executed and except where the signing and execution thereof shall be
expressly delegated by the board of directors to some other officer or
agent of the corporation.
THE VICE PRESIDENT
Section 8. The vice president shall, in the absence or disability
of the president, perform the duties and exercise the powers of the
president and shall perform such other duties as the board of
directors may from time to time prescribe.
THE SECRETARY
Section 9. The secretary shall attend all meetings of the board
of directors and all meetings of the stockholders and record all the
proceedings of the meetings of the corporation and of the board of
directors in a book to be kept for that purpose and shall perform like
duties for the standing committees when required. He shall give, or
cause to be given, notice of all meetings of the stockholders and special
meetings of the board of directors, and shall perform such other
duties as may be prescribed by the board of directors or president,
under whose supervision he shall be. He shall keep in safe custody the
seal of the corporation and, when authorized by the board of
directors, affix the same to any instrument requiring it and, when so
affixed, it shall be attested by his signature or by the signature of the
treasurer or an assistant secretary.
THE TREASURER
Section 10. The treasurer shall have the custody of the
corporate funds and securities and shall keep full and accurate
accounts of receipts and disbursements in books belonging to the
corporation and shall deposit all moneys and other valuable effects in
the name and to the credit of the corporation in such depositories as
may be designated by the board of directors.
Section 11. He shall disburse the funds of the corporation as
may be ordered by the board of directors taking proper vouchers for
such disbursements, and shall render to the president and the board
of directors, at the regular meetings of the board, or when the board
of directors so requires, an account of all his transactions as treasurer
and of the financial condition of the corporation.
Section 12. If required by the board of directors, he shall give the
corporation a bond in such sum and with such surety or sureties as
shall be satisfactory to the board of directors for the faithful
performance of the duties of his office and for the restoration to the
corporation, in case of his death, resignation, retirement or removal
from office, of all books, papers, vouchers, money and other property
of whatever kind in his possession or under his control belonging to
the corporation.
ARTICLE VI
CERTIFICATES OF STOCK
Section 1. Every stockholder shall be entitled to have a
certificate, signed by the president or a vice president and the
treasurer or an assistant treasurer, or the secretary or an assistant
secretary of the corporation, certifying the number of shares owned
by him in the corporation. If the corporation is authorized to issue
shares of more than one class or more than one series of any class,
there shall be set forth upon the face or back of the certificate, or the
certificate shall have a statement that the corporation will furnish to
any stockholders upon request and without charge, a full or summary
statement of the designations, preferences and relative, participating,
optional or other special rights of the various classes of stock or series
thereof and the qualifications, limitations or restrictions of such
rights, and, if the corporation shall be authorized to issue only special
stock, such certificate shall set forth in full or summarize the rights of
the holders of such stock.
Section 2. Whenever any certificate is countersigned or
otherwise authenticated by a transfer agent or transfer clerk, and by a
registrar, then a facsimile of the signatures of the officers or agents of
the corporation may be printed or lithographed upon such certificate
in lieu of the actual signatures. In case any officer or officers who
shall have signed, or whose facsimile signature or signatures shall
have been used on, any such certificate or certificates shall cease to be
such officer or officers of the corporation, whether because of death,
resignation or otherwise, before such certificate or certificates shall
have been delivered by the corporation, such certificate or certificates
may nevertheless be adopted by the corporation and be issued and
delivered as though the person or persons who signed such certificate
or certificates, or whose facsimile signature or signatures shall have
been used thereon, had not ceased to be an officer or officers of such
corporation.
LOST CERTIFICATES
Section 3. The board of directors may direct a new certificate
or certificates to be issued in place of any certificate or certificates
theretofore issued by the corporation alleged to have been lost or
destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate of stock to be lost or destroyed. When
authorizing such issue of a new certificate or certificates, the board of
directors may, in its discretion and as a condition precedent to the
issuance thereof, require the owner of such lost or destroyed
certificate or certificates, or his legal representative, to advertise the
same in such manner as it shall require and/or give the corporation a
bond in such sum as it may direct as indemnity against any claim that
may be made against the corporation with respect to the certificate
alleged to have been lost or destroyed.
TRANSFER OF STOCK
Section 4. Upon surrender to the corporation or the transfer
agent of the corporation of a certificate for shares duly endorsed or
accompanied by proper evidence of succession, assignment or
authority to transfer, it shall be the duty of the corporation to issue a
new certificate to the person entitled thereto, cancel the old certificate
and record the transaction upon its books.
CLOSING OF TRANSFER BOOKS
Section 5. The directors may prescribe a period not exceeding
sixty days prior to any meeting of the stockholders during which no
transfer of stock on the books of the corporation may be made, or
may fix a day not more than sixty days prior to the holding of any
such meeting as the day as of which stockholders entitled to notice of
and to vote at such meeting shall be determined; and only
stockholders of record on such day shall be entitled to notice or to
vote at such meeting.
REGISTERED STOCKHOLDERS
Section 6. The corporation shall be entitled to recognize the
exclusive right of a person registered on its books as the owner of
shares to receive dividends, and to vote as such owner, and to hold
liable for calls and assessments a person registered on its books as the
owner of shares, and shall not be bound to recognize any equitable or
other claim to or interest in such share or shares on the part of any
other person, whether or not it shall have express or other notice
thereof, except as otherwise provided by the laws of Nevada.
ARTICLE VII
GENERAL PROVISIONS
DIVIDENDS
Section 1. Dividends upon the capital stock of the corporation,
subject to the provisions of the articles of incorporation, if any, may
be declared by the board of directors at any regular or special
meeting pursuant to law. Dividends may be paid in cash, in property,
or in shares of the capital stock, subject to the provisions of the
articles of incorporation.
Section 2. Before payment of any dividend, there may be set
aside out of any funds of the corporation available for dividends such
sum or sums as the directors from time to time, in their absolute
discretion, think proper as a reserve or reserves to meet contingencies,
or for equalizing dividends, or for repairing or maintaining any
property of the corporation, or for such other purpose as the directors
shall think conducive to the interest of the corporation, and the
directors may modify or abolish any such reserves in the manner in
which it was created.
CHECKS
Section 3. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers or such other
person or persons as the board of directors may from time to time
designate.
FISCAL YEAR
Section 4. The fiscal year of the corporation shall be fixed by
resolution of the board of directors.
SEAL
Section 5. The corporate seal shall have inscribed thereon the
name of the corporation, the year of its incorporation and the words
"Corporate Seal, Nevada."
ARTICLE VIII
AMENDMENTS
Section 1. These by-laws may be altered or repealed at any
regular meeting of the stockholders or of the board of directors or at
any special meeting of the stockholders or of the board of directors if
notice of such alteration or repeal be contained in the notice of such
special meeting.
I, THE UNDERSIGNED, being the secretary of Venture Capital.Com
DO HEREBY CERTIFY the foregoing to be the by-laws of said
corporation, as adopted at a meeting of the directors held on the 31st
day of December, 1999.
/s/ James D. Martin
