U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
General Form for Registration of Securities of Small Business Issuers
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
CALIF ACQUISITIONS, INC.
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(Name of Small Business Issuer)
Nevada 88-0448315
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(State or Other Jurisdiction of I.R.S. Employer
Incorporation or Organization) Identification Number
1850 East Flamingo Road, Suite 111
Las Vegas, Nevada 89119
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(Address of Principal Executive Offices including Zip Code)
702-866-5839
(Issuer's Telephone Number)
Securities to be Registered Under Section 12(b) of the Act: None
Securities to be Registered Under Section 12(g) of the Act: Common Stock
$.001 Par Value
(Title of Class)
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PART I
ITEM 1. BUSINESS.
FORWARD LOOKING STATEMENTS
In this registration statement references to "Calif Acquisitions," "we,"
"us," and "our" refer to CALIF ACQUISITIONS, INC..
This Form 10-SB contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. For this
purpose any statements contained in this Form 10-SB that are not statements
of historical fact may be deemed to be forward-looking statements. Without
limiting the foregoing, words such as "may," "will," "expect," "believe,"
"anticipate," "estimate" or "continue" or comparable terminology are intended
to identify forward-looking statements. These statements by their nature
involve substantial risks and uncertainties, and actual results may differ
materially depending on a variety of factors, many of which are not within
Calif Acquisitions control. These factors include but are not limited to
economic conditions generally and in the industries in which Calif
Acquisitions, may participate; competition within Calif Acquisitions chosen
industry, including competition from much larger competitors; technological
advances and failure by Calif Acquisitions to successfully develop business
relationships.
DESCRIPTION OF BUSINESS
Business Development
Calif Acquisitions, Inc. was incorporated on January 18, 2000 in the
state of Nevada, to engage in any lawful corporate undertaking, including,
but not limited to, selected mergers and acquisitions. We have been in the
development stage since inception. Calif Acquisitions, Inc. has not engaged
in any commercial operations. Calif Acquisitions, Inc. does not have active
business operations, and at this time we are considered a "Blank Check"
company.
We will attempt to locate and negotiate with a business entity for
purposes of combining the Target Company with us. The combination will
normally take the form of a merger, stock-for-stock exchange or
stock-for-assets exchange. In most instances the Target Company will wish to
structure the business combination to be within the definition of a tax-free
reorganization under Section 351 or Section 368 of the Internal Revenue Code
of 1986, as amended. No assurances can be given that we will be successful in
locating or negotiating with any Target Company.
Our search for a business opportunity will not be limited to any
particular geographical area or industry. Our management has unrestricted
discretion in seeking and participating in a business opportunity, subject to
the availability of such opportunities, economic conditions and other
factors. Our management believes that companies who desire a public market to
enhance liquidity for current stockholders, plan to raise capital through the
public sale of securities or plan to acquire additional assets through
issuance of securities rather than for cash will be potential merger or
acquisition candidates.
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The selection of a business opportunity in which to participate is
complex and extremely risky and will be made by management in the exercise of
its business judgment. There is no assurance that we will be able to identify
and acquire any business opportunity which will ultimately prove to be
beneficial to our stockholders and us.
Our activities are subject to several significant risks, which arise
primarily as a result of the fact that we have no specific business and may
acquire or participate in a business opportunity based on the decision of
management which will, in all probability, act without consent, vote, or
approval of our stockholders.
Perceived Benefits
There are certain perceived benefits to being a reporting company with a
class of publicly traded securities. These are commonly thought to include
the following:
* the ability to use registered securities to make acquisitions of assets
or businesses;
* increased visibility in the financial community;
* the facilitation of borrowing from financial institutions;
* improved trading efficiency;
* stockholder liquidity;
* greater ease in subsequently raising capital;
* compensation of key employees through stock options for which there may
be a market valuation;
* enhanced corporate image;
* a presence in the United States capital market.
Potential Target Companies
A business entity, if any, which may be interested in a business
combination with us, may include the following:
* a company for which a primary purpose of becoming public is the use of
its securities for the acquisition of assets or businesses;
* a company which is unable to find an underwriter of its securities or is
unable to find an underwriter of securities on terms acceptable to it;
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* a company which wishes to become public with less dilution of its common
stock than would occur upon an underwriting;
* a company which believes that it will be able to obtain investment
capital on more favorable terms after it has become public;
* a foreign company which may be seeking an initial entry into the United
States securities market;
* a special situation company, such as a company seeking a public market
to satisfy redemption requirements under a qualified Employee Stock Option
Plan;
* a company seeking one or more of the other perceived benefits of
becoming a public company.
A business combination with a Target Company will normally involve the
transfer to the Target Company of the majority of our issued and outstanding
common stock, and the substitution by the Target Company of its own
management and board of directors.
No assurances can be given that we will be able to enter into a business
combination, as to the terms of a business combination, or as to the nature
of the Target Company.
We are voluntarily filing this Registration Statement with the
Securities and Exchange Commission and are under no obligation to do so under
the Securities Exchange Act of 1934.
The Company intends to provide an annual report to its security holders,
and to make quarterly reports available for inspection by its security
holders. The annual report will include audited financial statements.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "Exchange Act") and, in accordance
therewith, will file reports, proxy statements and other information with the
Commission. Such reports, proxy statements and other information may be
inspected at public reference facilities of the Commission at Judiciary
Plaza, 450 Fifth Street NW. Washington D.C. 20549; Northwest Atrium Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661; 7 World Trade
Center, new York, New York, 10048; and 5670 Wilshire Boulevard, Los Angeles,
California 90036. Copies of such material can be obtained from the Public
reference Section of the Commission at Judiciary Plaza, 450 Fifth Street NW.
Washington D.C. 20549 at prescribed rates.
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RISK FACTORS
Our business is subject to numerous risk factors, including the
following:
We are a development stage company with no operating history, no
revenues and minimal Assets. We have had no operating history and have not
had any revenues or earnings from operations. We have had no significant
assets or financial resources. We will, in all likelihood, sustain operating
expenses without corresponding revenues, at least until the consummation of a
business combination. This may result in incurring a net operating loss,
which will increase continuously until we can consummate a business
combination with a Target Company. There is no assurance that we can identify
such a Target Company and consummate such a business combination.
The Company is unlikely to continue as a going concern. The Company's
financial statements are prepared using the generally accepted accounting
principles applicable to a going concern, which contemplates the realization
of assets and liquidation of liabilities in the normal course of business.
However, the Company has no current source of revenue. Without realization
of additional capital, it would be unlikely for the Company to continue as a
going concern. It is management's plan to seek additional capital through
equity financings and seeking necessary bank loans.
Our proposed operation are speculative in nature in that our Success
depends on the operation, financial condition and management or our
identified Target Company. The success of our proposed plan of operation will
depend to a great extent on the operations, financial condition and
management of the identified Target Company. While management will prefer
business combinations with entities having established operating histories,
there can be no assurance that we will be successful in locating candidates
meeting such criteria. In the event that we complete a business combination,
of which there can be no assurance, the success of our operations will be
dependent upon management of the Target Company and numerous other factors
beyond our control.
We are an insignificant participant in the business of seeking mergers
wherein a large number of established and well financed entities are our
competitors. We are and will continue to be an insignificant participant in
the business of seeking mergers with and acquisitions of business entities. A
large number of established and well-financed entities, including venture
capital firms, are active in mergers and acquisitions of companies, which may
be merger or acquisition target candidates for us. Nearly all such entities
have significantly greater financial resources, technical expertise and
managerial capabilities than we do and, consequently, we will be at a
competitive disadvantage in identifying possible business opportunities and
successfully completing a business combination. Moreover, we will also
compete with numerous other small public companies in seeking merger or
acquisition candidates.
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Our limited funds and the lack of full time management make it
impracticable to conduct a complete and exhaustive investigation of a Target
Company. Our limited funds and the lack of full-time management will likely
make it impracticable to conduct a complete and exhaustive investigation and
analysis of a Target Company. The decision to enter into a business
combination, therefore, will likely be made without detailed feasibility
studies, independent analysis, market surveys or similar information which,
if we had more funds available to us, would be desirable. We will be
particularly dependent in making decisions upon information provided by the
principals and advisors associated with the business entity seeking our
participation.
We have no agreement for a business combination or other transaction and
have no predetermined standards for a business combination. We have no
current arrangement, agreement or understanding with respect to engaging in a
business combination with a specific entity. There can be no assurance that
we will be successful in identifying and evaluating suitable business
opportunities or in concluding a business combination. Management has not
identified any particular industry or specific business within an industry
for evaluation by us. There is no assurance that we will be able to negotiate
a business combination on terms favorable to us. We have not established a
specific length of operating history or a specified level of earnings,
assets, net worth or other criteria, which we will require a Target Company
to have achieved, or without which we would not consider a business
combination with such business entity. Accordingly, we may enter into a
business combination with a business entity having no significant operating
history, losses, limited or no potential for immediate earnings, limited
assets, negative net worth or other negative characteristics.
Our management is in the control of one individual who devotes a limited
amount of time to the company. While seeking a business combination,
management anticipates devoting only a limited amount of time per month to
our business. Our sole officer has not entered into a written employment
agreement with us and he is not expected to do so in the foreseeable future.
We have not obtained key man life insurance on our officer and director.
Notwithstanding the combined limited experience and time commitment of
management, loss of the services of this individual would adversely affect
development of our business and our likelihood of continuing operations.
Our sole officer and director participates in other business ventures
which compete with us. Our officer and director participates in other
business ventures, which may compete directly with us. Additional conflicts
of interest and non-arms length transactions may also arise in the future.
Management has adopted a policy that we will not seek a business combination
with any entity in which any member of management serves as an officer,
director or partner, or in which they or their family members own or hold
more than 10% ownership interest.
The failure of a Target Company to have available certain critical
information required of a reporting company may delay or preclude an
acquisition. Section 13 of the Securities Exchange Act of 1934 (the
"Exchange Act") requires companies subject thereto to provide certain
information about significant acquisitions including audited financial
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statements for the company acquired covering one or two years, depending on
the relative size of the acquisition. The time and additional costs that may
be incurred by some target companies to prepare such financial statements may
significantly delay or essentially preclude consummation of an otherwise
desirable acquisition by us. Acquisition prospects that do not have or are
unable to obtain the required audited statements may not be appropriate for
acquisition so long as the reporting requirements of the Exchange Act are
applicable.
Our Company has not conducted a market research nor do we have the
availability to hire a market research or marketing organization. We have
neither conducted, nor have others made available to us, market research
indicating that demand exists for the transactions contemplated by us. Even
in the event demand exists for a transaction of the type contemplated by us,
there is no assurance that we will be successful in completing any such
business combination.
Upon completing of a merger, it is unlikely our company will have any
diversification. Our proposed operations, even if successful, will in all
likelihood result in our engaging in a business combination with only one
Target Company. Consequently, our activities will be limited to those engaged
in by the business entity which we merge with or acquire. Our inability to
diversify our activities into a number of areas may subject us to economic
fluctuations within a particular business or industry and therefore increase
the risks associated with our operations.
We believe that the company is not subject to the Investment Company Act
of 1940, although a subsequent merger could cause us to be subject to the
Investment Company Act of 1940. Although we will be subject to regulation
under the Exchange Act, management believes we will not be subject to
regulation under the Investment Company Act of 1940, insofar as we will not
be engaged in the business of investing or trading in securities. In the
event we engage in business combinations, which result in our holding passive
investment interests in a number of entities, we could be subject to
regulation under the Investment Company Act of 1940. In such event, we would
be required to register as an investment company and could be expected to
incur significant registration and compliance costs. We have obtained no
formal determination from the Securities and Exchange Commission as to our
status under the Investment Company Act of 1940 and, consequently, any
violation of such Act could subject us to material adverse consequences.
A merger with our company will result in a change in control and
management. A business combination involving the issuance of our common
stock will, in all likelihood, result in stockholders of a Target Company
obtaining a controlling interest in us. Any such business combination may
require our stockholders to sell or transfer all or a portion of our common
stock held by them. The resulting change in control will likely result in
removal of our present officer and director and a corresponding reduction in
or elimination of his participation in our future affairs.
Following a business combination of a Target Company our stockholders
will receive a reduced ownership in the Target Company. Our primary plan of
operation is based upon a business combination with a business entity, which,
in all likelihood, will result in our issuing securities to stockholders of
such business entity. The issuance of our previously authorized and unissued
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common stock would result in reduction in percentage of shares owned by our
present stockholders and would most likely result in a change in control or
management.
Federal and State tax consequences will be a major consideration in any
business combination. Federal and state tax consequences will, in all
likelihood, be major considerations in any business combination we may
undertake. Currently, such transactions may be structured so as to result in
tax-free treatment to both companies, pursuant to various federal and state
tax provisions. We intend to structure any business combination so as to
minimize the federal and state tax consequences to the Target Company and us;
however, there can be no assurance that such business combination will meet
the statutory requirements of a tax-free reorganization or that the parties
will obtain the intended tax-free treatment upon a transfer of stock or
assets. A non-qualifying reorganization could result in the imposition of
both federal and state taxes, which may have an adverse effect on both
parties to the transaction.
We may have to rely upon unaudited financial statements which will
result in our not having benefit of full and accurate financial information.
We will require audited financial statements from any business entity that we
propose to acquire. No assurance can be given, however, that audited
financials will be available to us prior to a business combination. In cases
where audited financials are unavailable, we will have to rely upon unaudited
information that has not been verified by outside auditors in making our
decision to engage in a transaction with the business entity. The lack of the
type of independent verification, which audited financial statements, would
provide in evaluating a transaction with a Target Company increases our risk.
Additionally we will not have the benefit of full and accurate information
about the financial condition and operating history of the Target Company.
This risk increases the prospect that a business combination with such a
business entity might prove to be an unfavorable one for us.
Computer systems which have not been corrected for the year 2000 problem
may have a negative impact on our company. Many existing computer programs
use only two digits to identify a year in such program's date field. These
programs were designed and developed without consideration of the impact of
the change in the century for which four digits will be required to
accurately report the date. If not corrected, many computer applications
could fail or create erroneous results by or following the year 2000 ("Year
2000 Problem"). The companies or governments operating such programs may not
have corrected many of the computer programs containing such date language
problems. It is impossible to predict what computer programs will be
affected, the impact any such computer disruption will have on other
industries or commerce, or the severity or duration of a computer disruption.
We may be impacted by the Year 2000 Problem as the result of a merger.
Before we enter into any business combination, we may inquire as to the
status of any Target Company's Year 2000 Problem, the steps such Target
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Company has taken or intends to take to correct any such problem and the
probable impact on such Target Company of any computer disruption. However,
there can be no assurance that we will not enter into a business combination
with a Target Company that has an uncorrected Year 2000 Problem or that any
planned Year 2000 Problem corrections will be sufficient. The extent of the
Year 2000 Problem of a Target Company may be impossible to ascertain and any
impact on us will likely be impossible to predict.
ITEM 2. PLAN OF OPERATION.
We intend to enter into a business combination with a Target Company in
exchange for our securities. As of this filing neither our officer and
director nor any affiliate has engaged in any negotiations with any
representative of any specific entity regarding the possibility of a business
combination with us.
Management anticipates seeking out a Target Company through
solicitation. Such solicitation may include newspaper or magazine
advertisements, mailings and other distributions to law firms, accounting
firms, investment bankers, financial advisors and similar persons, the use of
one or more World Wide web sites and similar methods. No estimate can be made
as to the number of persons who will be contacted or solicited. Management
may engage in such solicitation directly or may employ one or more other
entities to conduct or assist in such solicitation. These individuals are
anticipated to merely make an introduction between the company and the Target
Company. Thus, the company does not plan on entering into any term
agreements. Management and its affiliates may pay referral fees to
consultants and others who refer target businesses for mergers into public
companies in which management and its affiliates have an interest. Payments
are made if a business combination occurs, and may consist of cash or a
portion of our stock retained by management and its affiliates, or both.
As of this filing the company has no proposed notice, advertisements or
other means of soliciting a merger candidate.
Our management has entered into a verbal agreement with the law firm of
Sperry Young & Stoecklein, to supervise the search for target companies as
potential candidates for a business combination. Sperry Young & Stoecklein,
will receive legal fees in consideration of its agreement to provide such
services. Sperry Young & Stoecklein will pay as its own expenses any costs it
incurs in supervising the search for a Target Company. Sperry Young, &
Stoecklein is not authorized to enter into any agreement binding us, which
can only be done by action of our officer, director and stockholders, as may
be required. Sperry Young & Stoecklein is an affiliate of our management. It
is anticipated that Sperry Young and Stoecklein will receive attorney's fees
in connection with our merger upon determining a merger candidate.
We have no full time employees. Our president has agreed to allocate a
portion of his time to our activities, without compensation. The president
anticipates that our business plan can be implemented by his devoting no more
than 10 hours per month to our business affairs and, consequently, conflicts
of interest may arise with respect to the limited time commitment by such
officer.
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Management is currently involved with other blank check companies, and
is involved in creating additional blank check companies similar to this one.
A conflict may arise in the event that another blank check company with which
management is affiliated is formed and actively seeks a Target Company.
Management anticipates that target companies will be located for us and other
blank check companies in chronological order of the date of formation of such
blank check companies or, in the case of blank check companies formed on the
same date, alphabetically. However, other blank check companies with which
management is or may be affiliated may differ from us in certain items such
as place of incorporation, number of shares and stockholders, working
capital, types of authorized securities, or other items. It may be that a
Target Company may be more suitable for or may prefer a certain blank check
company formed after we were. In such case, a business combination might be
negotiated on behalf of the more suitable or preferred blank check company
regardless of date of formation.
Our Articles of Incorporation provide that we may indemnify our officers
and/or directors for our liabilities, which can include liabilities arising
under the securities laws. Therefore, our assets could be used or attached to
satisfy any liabilities subject to such indemnification.
General Business Plan
Our purpose is to seek, investigate and, if such investigation warrants,
acquire an interest in a business entity, which desires to seek the perceived
advantages of a corporation, which has a class of securities registered under
the Exchange Act. We will not restrict our search to any specific business,
industry, or geographical location and we may participate in a business
venture of virtually any kind or nature. Management anticipates that it will
be able to participate in only one potential business venture because we have
nominal assets and limited financial resources. This lack of diversification
should be considered a substantial risk to our stockholders because it will
not permit us to offset potential losses from one venture against gains from
another.
We may seek a business opportunity with entities which have recently
commenced operations, or which wish to utilize the public marketplace in
order to raise additional capital in order to expand into new products or
markets, to develop a new product or service, or for other corporate
purposes.
We anticipate that the selection of a business opportunity in which to
participate will be complex and extremely risky. Management believes (but has
not conducted any research to confirm) that there are business entities
seeking the perceived benefits of a publicly registered corporation. Such
perceived benefits may include facilitating or improving the terms on which
additional equity financing may be sought, providing liquidity for incentive
stock options or similar benefits to key employees, increasing the
opportunity to use securities for acquisitions, providing liquidity for
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stockholders and other factors. Business opportunities may be available in
many different industries and at various stages of development, all of which
will make the task of comparative investigation and analysis of such business
opportunities difficult and complex.
We have, and will continue to have, no capital with which to provide the
owners of business entities with any cash or other assets. However,
management believes we will be able to offer owners of acquisition candidates
the opportunity to acquire a controlling ownership interest in a public
company without incurring the cost and time required to conduct an initial
public offering. Management has not conducted market research and is not
aware of statistical data to support the perceived benefits of a business
combination for the owners of a Target Company.
The analysis of new business opportunities will be undertaken by, or
under the supervision of, our officer and director, who is not a professional
business analyst. In analyzing prospective business opportunities, management
may consider such matters as the available technical, financial and
managerial resources; working capital and other financial requirements;
history of operations, if any; prospects for the future; nature of present
and expected competition; the quality and experience of management services
which may be available and the depth of that management; the potential for
further research, development, or exploration; specific risk factors not now
foreseeable but which then may be anticipated to impact our proposed
activities; the potential for growth or expansion; the potential for profit;
the perceived public recognition or acceptance of products, services, or
trades; name identification; and other relevant factors. This discussion of
the proposed criteria is not meant to be restrictive of our virtually
unlimited discretion to search for and enter into potential business
opportunities.
The Exchange Act requires that any merger or acquisition candidate
comply with certain reporting requirements, which include providing audited
financial statements to be included in the reporting filings made under the
Exchange Act. We will not acquire or merge with any company for which audited
financial statements cannot be obtained at or within the required period of
time after closing of the proposed transaction.
We may enter into a business combination with a business entity that
desires to establish a public trading market for its shares. A Target Company
may attempt to avoid what it deems to be adverse consequences of undertaking
its own public offering by seeking a business combination with us. Such
consequences may include, but are not limited to, time delays of the
registration process, significant expenses to be incurred in such an
offering, loss of voting control to public stockholders or the inability to
obtain an underwriter or to obtain an underwriter on satisfactory terms.
We will not restrict our search for any specific kind of business
entities, but may acquire a venture, which is in its preliminary or
development stage, which is already in operation, or in essentially any stage
of its business life. It is impossible to predict at this time the status of
any business in which we may become engaged, in that such business may need
to seek additional capital, may desire to have its shares publicly traded, or
may seek other perceived advantages which we may offer.
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Our management, which in all likelihood will not be experienced in
matters relating to the business of a Target Company, will rely upon its own
efforts in accomplishing our business purposes. Following a business
combination we may benefit from the services of others in regard to
accounting, legal services, underwriting and corporate public relations. Mr.
DeMint, the sole officer, director, and stockholder of the company generally
recommends that the company utilizes the legal services as provided by Sperry
Young & Stoecklein, through Donald J. Stoecklein, Esq. who has extensive
experience in mergers, acquisitions, and 1934 Act reporting. Mr. DeMint does
not generally recommend other advisors to the company. Mr. DeMint is an
affiliate of Sperry Young & Stoecklein.
Acquisition of Opportunities
In implementing a structure for a particular business acquisition, we
may become a party to a merger, consolidation, reorganization, joint venture,
or licensing agreement with another corporation or entity. On the
consummation of a transaction, it is likely that the present management and
our stockholders will no longer be in our control. In addition, it is likely
that our officer and director will, as part of the terms of the acquisition
transaction, resign and be replaced by one or more new officers and
directors.
It is anticipated that any securities issued in any such reorganization
would be issued in reliance upon exemption from registration under applicable
federal and state securities laws. In some circumstances, however, as a
negotiated element of our transaction, we may agree to register all or a part
of such securities immediately after the transaction is consummated or at
specified times thereafter. If such registration occurs, it will be
undertaken by the surviving entity after we have entered into an agreement
for a business combination or have consummated a business combination and we
are no longer considered a blank check company. The issuance of additional
securities and their potential sale into any trading market which may develop
in our securities may depress the market value of the our securities in the
future if such a market develops, of which there is no assurance.
Currently there are no plans, proposals, arrangements or understandings
with respect to the sale or issuance of additional securities by the company
prior to the location of an acquisition or merger candidate.
While the terms of a business transaction to which we may be a party
cannot be predicted, it is expected that the parties to the business
transaction will desire to avoid the creation of a taxable event and thereby
structure the acquisition in a tax-free reorganization under Sections 351 or
368 of the Internal Revenue Code of 1986, as amended.
With respect to negotiations with a Target Company, management expects
to focus on the percentage of the Company which Target Company stockholders
would acquire in exchange for their stockholdings in the Target Company.
Depending upon, among other things, the Target Company's assets and
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liabilities, our stockholders will in all likelihood hold a substantially
lesser percentage ownership interest in the Company following any merger or
acquisition. The percentage of ownership may be subject to significant
reduction in the event we acquire a Target Company with substantial assets.
Any merger or acquisition effected by us can be expected to have a
significant dilutive effect on the percentage of shares held by our
stockholders at such time.
We will participate in a business opportunity only after the negotiation
and execution of appropriate agreements. Although the terms of such
agreements cannot be predicted, generally such agreements will require
certain representations and warranties of the parties thereto, will specify
certain events of default, will detail the terms of closing and the
conditions which must be satisfied by the parties prior to and after such
closing and will include miscellaneous other terms.
We will not enter into a business combination with any entity, which
cannot provide audited financial statements at or within the required period
of time after closing of the proposed transaction. We are subject to all of
the reporting requirements included in the Exchange Act. Included in these
requirements is our duty to file audited financial statements as part of or
within 60 days following the due date for filing our Form 8-K which is
required to be filed with the Securities and Exchange Commission within 15
days following the completion of the business combination. If such audited
financial statements are not available at closing, or within time parameters
necessary to insure our compliance with the requirements of the Exchange Act,
or if the audited financial statements provided do not conform to the
representations made by the Target Company, the closing documents may provide
that the proposed transaction will be voidable at the discretion of our
present management.
Management has orally agreed that it will advance to us any additional
funds, which we need for operating capital and for costs in connection with
searching for or completing an acquisition or merger. Such advances will be
made without expectation of repayment. There is no minimum or maximum amount
management will advance to us. We will not borrow any funds to make any
payments to our management, its affiliates or associates.
The Board of Directors has passed a resolution which contains a policy
that the we will not seek a business combination with any entity in which our
officer, director, stockholders or any affiliate or associate serves as an
officer or director or holds an ownership interest greater than ten percent
(10%).
Undertakings and Understandings Required of Target Companies
As part of a business combination agreement, we intend to obtain
certain representations and warranties from a Target Company as to its
conduct following the business combination. Such representations and
warranties may include (i) the agreement of the Target Company to make all
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necessary filings and to take all other steps necessary to remain a reporting
company under the Exchange Act (ii) imposing certain restrictions on the
timing and amount of the issuance of additional free-trading stock, including
stock registered on Form S-8 or issued pursuant to Regulation S and (iii)
giving assurances of ongoing compliance with the Securities Act, the Exchange
Act, the General Rules and Regulations of the Securities and Exchange
Commission, and other applicable laws, rules and regulations.
A prospective Target Company should be aware that the market price and
volume of its securities, when and if listed for secondary trading, may
depend in great measure upon the willingness and efforts of successor
management to encourage interest in the Company within the United States
financial community. We do not have the market support of an underwriter that
would normally follow a public offering of our securities. Initial market
makers are likely to simply post bid and asked prices and are unlikely to
take positions in our securities for their own account or customers without
active encouragement and a basis for doing so. In addition, certain market
makers may take short positions in our securities, which may result in a
significant pressure on the market price of our securities. We may consider
the ability and commitment of a Target Company to actively encourage interest
in its securities following a business combination in deciding whether to
enter into a transaction with such company.
A business combination with us separates the process of becoming a
public company from the raising of investment capital. As a result, a
business combination with us normally will not be a beneficial transaction
for a Target Company whose primary reason for becoming a public company is
the immediate infusion of capital. We may require assurances from the Target
Company that it has or that it has a reasonable belief that it will have
sufficient sources of capital to continue operations following the business
combination. However, it is possible that a Target Company may give such
assurances in error, or that the basis for such belief may change as a result
of circumstances beyond the control of the Target Company.
Prior to completion of a business combination, we may generally
require that we be provided with written materials regarding the Target
Company containing such items as a description of products, services and
company history; management resumes; financial information; available
projections, with related assumptions upon which they are based; an
explanation of proprietary products and services; evidence of existing
patents, trademarks, or service marks, or rights thereto; present and
proposed forms of compensation to management; a description of transactions
between such company and its affiliates during relevant periods; a
description of present and required facilities; an analysis of risks and
competitive conditions; a financial plan of operation and estimated capital
requirements; audited financial statements, or if they are not available,
unaudited financial statements, together with reasonable assurances that
audited financial statements would be able to be produced within a reasonable
period of time not to exceed 75 days following completion of a business
combination; and other information deemed relevant.
<PAGE>
Competition
We will remain an insignificant participant among the firms, which
engage in the acquisition of business opportunities. There are many
established venture capital and financial firms which have significantly
greater financial and personnel resources and technical expertise than we do.
In view of our combined extremely limited financial resources and limited
management availability, we will continue to be at a significant competitive
disadvantage compared to our competitors.
ITEM 3. DESCRIPTION OF PROPERTY.
We have no properties and at this time have no agreements to acquire any
properties. We currently use the offices of Anthony DeMint, our officer and
director, at no cost to us. Management has agreed to continue this
arrangement until we complete an acquisition or merger.
ITEM 4.SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The following table sets forth each person known by us to be the
beneficial owner of five percent or more of our Common Stock, all directors
individually and all directors and officers as a group. Except as noted, each
person has sole voting and investment power with respect to the shares shown.
<TABLE>
Name and Address Amount of Beneficial Percentage
of Beneficial Owner Ownership of Class
<S> <C> <C>
Anthony DeMint 5,000,000 100%
241 Paradise Bird St.
Henderson, NV 89014
</TABLE>
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
The Company has one Director, Officer, Promoter and Control Person as
follows:
<TABLE>
Name Age Positions and Offices Held
<S> <C> <C>
Anthony N. DeMint 26 President, Secretary, Treasurer, Director
There are no agreements or understandings for the officer or director to
resign at the request of another person and the above-named officer and
director is not acting on behalf of nor will act at the direction of any
other person. Mr. DeMint is the only person whose activities will be
material to the operations of the company.
Set forth below is the name of our director and officer, all positions
and offices held, the period during which he has served as such, and the
business experience during at least the last five years:
<PAGE>
Anthony N. DeMint acts as President, Secretary, Treasurer and Director
for the Company. Mr. DeMint has served as an officer and Director of the
Company since inception. Mr. DeMint is also sole officer and Director of
Scientific Fuel Technology, Rub Investments, LTD, Accessory Specialists,
Inc., Your Domain.Com, Nothing Corp., Tac Asset Corp., TourPro Golf, Inc.,
Euro Technology Outfitters, Fun For You, Inc., Interbank Capital Corp.,
SAVEYOUTIME.COM, INC., Take A Ride, Inc., Tell-A-Tale Incorporated, Too Late
Financial Corporation, Vanity Enterprises, Inc. and YFC 355 Corp which are
also blank check companies. Since 1994, Mr. DeMint has been a business
consultant and has served on the board of directors and as an officer for
several private and public companies. Mr. DeMint currently serves as
President and as a Director of Securities Law Institute, a securities
consulting firm. From 1997-1998, Mr. DeMint was Vice President of operations
and a Director for Worldwide Golf Resources, Inc. From 1995-1997, Mr. DeMint
was Chief Operating Officer, Treasurer and a Director of a publicly held
import and wholesale company, Cutty-Fleet Trading Co., where he managed day-
to-day operations. Mr. DeMint attended Business and Economics school at the
University of Nevada Las Vegas. Mr. DeMint is an affiliate of Sperry Young &
Stoecklein.
Previous And Current Blank Check Companies
The SEC reporting blank check companies that Anthony DeMint serves or
has served as President and Director are listed in the following table:
</TABLE>
<TABLE>
Date
Incorporation Name Form Type File # of Filing Status(l)
<S> <C> <C> <C> <C>
Intercontinental
Capital Fund, Inc. 10SB12G 000-27931 04 Nov 99 Merger (2a)
Tele Special.Com 10SB12G 000-28207 19 Nov 99 Merger (2b)
Navitec Group Inc. 10SB12G 000-28225 22 Nov 99 Merger (2c)
Royal Acquisitions, Inc. 10SB12G 000-28713 30 Dec 99 Merger (2d)
LifePlan 10SB12G 000-29033 08 Jan 00 Merger (2e)
Central America Fuel
Technology, Inc. 10SB12G 000-28697 29 Dec 99 Merger (2f)
Scientific Fuel
Technology, Inc. 10SB12G 000-28685 28 Dec 99 Merger (2g)
TourPro Golf, Inc. 10SB12G 000-28569 20 Dec 99 Merger (2h)
Rub Investments, LTD(3) 10SB12G 000-29315 03 Feb 00 No
Accessory Specialists Inc.(3) 10SB12G 000-29353 07 Feb 00 No
Your Domain.com (3) 10SB12G 000-29317 03 Feb 00 No
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Nothing Corp.(3) 10SB12G 000-29399 08 Feb 00 No
Tac Asset Corp (3) 10SB12G 000-29355 07 Feb 00 No
Euro Technology Outfitters (3) 10SB12G 000-30009 20 Mar 00 No
Fun For You, Inc. (3) 10SB12G 000-30055 22 Mar 00 No
Interbank Capital Corp. (3) 10SB12G 000-30067 23 Mar 00 No
SAVEYOUTIME.COM, INC. (3) 10SB12G 000-30085 23 Mar 00 No
Take A Ride, Inc. (3) 10SB12G 000-30113 27 Mar 00 No
Tell-A-Tale, Incorporated (3) 10SB12G 000-30131 28 Mar 00 No
Too Late Financial Corporation (3) 10SB12G 000-30149 29 Mar 00 No
Vanity Enterprises, Inc. (3) 10SB12G 000-30169 31 Mar 00 No
YFC 355 Corp (3) 10SB12G 000-30201 03 Apr 00 No
</TABLE>
(1) Under Merger Status "Merger" represents either a merger or an
acquisition has occurred or the company ceased to be a blank check company by
operating specific business a "No" represents that the company is currently
seeking merger or acquisition candidate. More detailed information for each
merger is disclosed in following paragraphs.
(2) (2a) In January 2000 Intercontinental Capital Fund, Inc. merged with
Desert Health Products, Inc. ("DHP") whereby DHP was the surviving
corporation and Intercontinental Capital Fund ceased to exist. DHP was formed
to develop dietary supplement products from natural plant extracts. DHP is
focusing its development efforts on certain plants and plant extracts that
are widely used throughout the United States and Europe to treat a variety of
diseases and physical conditions. Pursuant to the Plan of Merger, DHP issued
400,000 shares of restricted Common Stock to Anthony N. DeMint in exchange
for the cancellation of Mr. DeMint's 5,000,000 shares of Intercontinental
Capital Fund Common Stock. DHP paid $100,000 in cash to Sperry Young &
Stoecklein, of which Anthony N. DeMint is an affiliate, for legal fees
associated with the merger. Mr. DeMint currently is a non-affiliated
stockholder of DHP. DHP is currently a SEC reporting company under 12(g) of
the Securities and Exchange Act of 1934.
(2b) In January 2000 Tele Special.Com merged with International Brands,
Inc. ("INBR") whereby INBR was the surviving corporation and Tele
Special.Com ceased to exist. INBR is a holding company for various
Internet related companies. Pursuant to the Plan of Merger, INBR issued
25,000 shares of restricted Common Stock to Anthony N. DeMint in
<PAGE>
exchange for the cancellation of Mr. DeMint's 5,000,000 shares of Tele
Special.Com Common Stock. INBR paid $150,000 in cash to Sperry Young &
Stoecklein, of which Anthony N. DeMint is an affiliate, for legal fees
associated with the merger. Mr. DeMint currently is a non-affiliated
stockholder of INBR. INBR is currently a SEC reporting company under
12(g) of the Securities and Exchange Act of 1934.
(2c) In February 2000 Navitec Group, Inc. merged with Worldnet
Resources Group, Inc. ("WRGI") whereby WRGI was the surviving
corporation and Navitec Group, Inc. ceased too exist. WRGI is a holding
company for various Internet related companies. Pursuant to the Plan of
Merger, WRGI issued 2,083 shares of restricted Common Stock to Anthony
N. DeMint in exchange for the cancellation of Mr. DeMint's 5,000,000
shares of Tele Special.Com Common Stock. WRGI paid $150,000 in cash to
Sperry Young & Stoecklein, of which Anthony N. DeMint is an affiliate,
for legal fees associated with the merger. Mr. DeMint currently is a non-
affiliated stockholder of WRGI. WRGI is currently a SEC reporting
company under 12(g) of the Securities and Exchange Act of 1934.
(2d) In March 2000 Royal Acquisitions, Inc. merged with zebramart.Com,
Inc. ("ZMRT") whereby ZMRT was the surviving corporation and Royal
Acquisitions, Inc. ceased too exist. ZMRT the internet's premier luxury
shopping club, offers upscale contemporary merchandise in a variety of
lifestyle categories. Pursuant to the Plan of Merger, ZMRT issued
2,000,000 shares of restricted Common Stock to Anthony N. DeMint in
exchange for the cancellation of Mr. DeMint's 5,000,000 shares of Royal
Acquisitions, Inc. Common Stock. ZMRT paid $200,000 in cash to Sperry
Young & Stoecklein, of which Anthony N. DeMint is an affiliate, for
legal fees associated with the merger. Mr. DeMint currently is a non-
affiliated stockholder of ZMRT. ZMRT is currently a SEC reporting
company under 12(g) of the Securities and Exchange Act of 1934.
(2e) In March 2000 LifePlan, merged with HIV-VAC, INC. ("HIVC") whereby
HIVC was the surviving corporation and LifePlan ceased too exist. HIVC
is an Internet premier luxury shopping club, offers upscale contemporary
merchandise in a variety of lifestyle categories. Pursuant to the Plan
of Merger, HIVC issued 100,000 shares of restricted Common Stock to
Anthony N. DeMint in exchange for the cancellation of Mr. DeMint's
10,000,000 shares of LifePlan Common Stock. Mr. DeMint currently is a
non-affiliated stockholder of HIVC. HIVC is currently a SEC reporting
company under 12(g) of the Securities and Exchange Act of 1934.
(2f) In March 2000 Central America Fuel Technology, Inc. merged with
Presidents Telecom, Inc. ("PRTE") whereby PRTE was the surviving
corporation and Central America Fuel Technology, Inc. ceased too exist.
PRTE establishes satellite communications world wide to Costa Rican
companies. Pursuant to the Plan of Merger, PRTE issued 5,000 shares of
restricted Common Stock to Anthony N. DeMint in exchange for the
cancellation of Mr. DeMint's 10,000,000 shares of Central America Fuel
Technology, Inc. Common Stock. Mr. DeMint currently is a non-affiliated
stockholder of PRTE. PRTE is currently a SEC reporting company under
12(g) of the Securities and Exchange Act of 1934.
<PAGE>
(2g) On April 6, 2000 Mr. DeMint the sole officer, director and
stockholder of Scientific Fuel Technology, Inc. sold 100% of his
interest in Scientific Fuel Technology, Inc. to Vertical Computers
Systems, Inc.("VCSY"). VCSY is a multi lingual portal provider, a e-
commerce solutions company, based in the United States. Pursuant to the
Plan of Merger, VCSY issued 2,000,000 shares of restricted Common Stock
to Anthony N. DeMint in exchange for Mr. DeMint's 10,000,000 shares of
Scientific Fuel Technology Common Stock. Scientific Fuel Technology,
Inc. is currently a wholly owned subsidiary of VCSY. Mr. DeMint
currently is a non-affiliated stockholder of VCSY.
(2h) In March 2000 TourPro Golf Inc. entered into a Letter of Intent to
Merge with Mirage Computers, Inc. whereby Mirage Computers, Inc. will be
the surviving successor corporation and TourPro Golf, Inc. will cease to
exist.
(3) On the 60th day of the filing, each company becomes subject to the
reporting requirements under the Securities Exchange Act of 1934, unless
accelerated by the SEC, at the request of the company.
Conflicts of Interest
Our officer and director may organize other companies of a similar
nature and with a similar purpose as us. Consequently, there are potential
inherent conflicts of interest in acting as our officer and director. Insofar
as the officer and director are engaged in other business activities,
management anticipates that he will devote only a minor amount of time to our
affairs. We do not have a right of first refusal pertaining to opportunities
that come to management's attention insofar as such opportunities may relate
to our proposed business operations.
A conflict may arise in the event that another blank check company with
which management is affiliated is formed and actively seeks a Target Company.
It is anticipated that target companies will be located for us and other
blank check companies in chronological order of the date of formation of such
blank check companies or, in the case of blank check companies formed on the
same date, alphabetically. However, any blank check companies with which
management is, or may be, affiliated may differ from us in certain items such
as place of incorporation, number of shares and stockholders, working
capital, types of authorized securities, or other items. It may be that a
Target Company may be more suitable for or may prefer a certain blank check
company formed after us. In such case, a business combination might be
negotiated on behalf of the more suitable or preferred blank check company
regardless of date of formation.
Mr. DeMint may have demands placed on his time, which will detract from
the amount of time he is able to devote to us. Mr. DeMint intends to devote
as much time to our activities as required. However, should such a conflict
arise, there is no assurance that Mr. DeMint would not attend to other
matters prior to ours. Mr. DeMint projects that initially up to ten hours per
<PAGE>
month of his time may be spent locating a Target Company which amount of time
would increase when the analysis of, and negotiations and consummation with,
a Target Company are conducted.
The terms of business combination may include such terms as are
negotiated by Mr. DeMint, remaining a director or officer of the Company,
and/or the consulting firm retained by management. The terms of a business
combination may provide for a payment by cash or otherwise to Mr. DeMint for
the purchase or retirement of all or part of his common stock by a Target
Company or for services rendered incident to or following a business
combination. Mr. DeMint would directly benefit from such employment or
payment. Such benefits may influence Mr. DeMint' choice of a Target Company.
We may agree to pay finder's fees, as appropriate and allowed, to
unaffiliated persons who may bring a Target Company to us where that referral
results in a business combination. No finder's fee of any kind will be paid
by us to management or our promoters or to there associates or affiliates. No
loans of any type have, or will be, made by us to management or our promoters
of or to any of their associates or affiliates.
We will not enter into a business combination, or acquire any assets of
any kind for our securities, in which our management or any affiliates or
associates have a greater than 10% interest, direct or indirect.
There are no binding guidelines or procedures for resolving potential
conflicts of interest. Failure by management to resolve conflicts of interest
in favor of us could result in liability of management to us. However, any
attempt by stockholders to enforce a liability of management to us would most
likely be prohibitively expensive and time consuming.
Investment Company Act of 1940
Although we will be subject to regulation under the Securities Act of
1933 and the Securities Exchange Act of 1934, management believes the we will
not be subject to regulation under the Investment company Act of 1940 insofar
as we will not be engaged in the business of investing or trading in
securities. In the event we engage in business combinations which result in
us holding passive investment interests in a number of entities we could be
subject to regulation under the Investment Company Act of 1940. In such
event, we would be required to register as an investment company and could be
expected to incur significant registration and compliance costs. We have
obtained no formal determination from the Securities and Exchange Commission
as to our status under the Investment Company Act of 1940. Any violation of
such Act would subject us to material adverse consequences.
ITEM 6. EXECUTIVE COMPENSATION.
Our officer and director does not receive any compensation for his
services rendered to us, has not received such compensation in the past, and
is not accruing any compensation pursuant to any agreement with us. However,
our officer and director anticipates receiving benefits as a beneficial
stockholder of the company and, possibly, in other ways.
<PAGE>
We have not adopted any retirement, pension, profit sharing, stock
option or insurance programs or other similar programs for the benefit of our
officer or director.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
We have issued a total of 5,000,000 shares of Common Stock to the
following persons for a total of $5,000 in services:
<TABLE>
Name Number of Total Shares Consideration
<S> <C> <C>
Anthony N. DeMint 5,000,000 $5,000
</TABLE>
Anthony N. DeMint is the President, Secretary, Treasurer, and sole
Director for the Company. The total number of shares were issued to Mr.
DeMint in exchange for services rendered to the Company, in lieu of cash. Mr.
DeMint was responsible for corporate formation and filing of the company 10SB
with audit.
Officers Advances. Anthony DeMint has advanced $1,327 to the company,
interest free, on a payment on demand basis.
ITEM 8. DESCRIPTION OF SECURITIES.
Our authorized capital stock consists of 20,000,000 shares of Common
Stock, par value $.001 per share of which 5,000,000 shares are issued and
outstanding. We have authorized 5,000,000 of Preferred Stock, par value $.001
per share of which there are no shares outstanding. The following statements
relating to the capital stock set forth the material terms of our securities;
however, reference is made to the more detailed provisions of, and such
statements are qualified in their entirety by reference to, the Articles of
Incorporation and the Bylaws, copies of which are filed as exhibits to this
registration statement.
Common Stock
Holders of shares of common stock are entitled to one vote for each
share on all matters to be voted on by the stockholders. Holders of common
stock do not have cumulative voting rights. Holders of common stock are
entitled to share ratably in dividends, if any, as may be declared from time
to time by the Board of Directors in its discretion from funds legally
available therefore. In the event of our liquidation, dissolution or winding
up, the holders of common stock are entitled to share pro rata all assets
remaining after payment in full of all liabilities. All of the outstanding
shares of common stock are fully paid and non-assessable.
Holders of common stock have no preemptive rights to purchase our common
stock. There are no conversion or redemption rights or sinking fund
provisions with respect to the common stock.
<PAGE>
Preferred Stock
The Board of Directors is authorized to provide for the issuance of
shares of preferred stock in series and, by filing a certificate if
applicable, pursuant to the applicable law of Nevada, to establish from time
to time the number of shares to be included in each such series, and to fix
the designation, powers, preferences and rights of the shares of each such
series and the qualifications, limitations or restrictions thereof without
any further vote or action by the stockholders. Any shares of preferred
stock so issued would have priority over the common stock with respect to
dividend or liquidation rights. Any future issuance of preferred stock may
have the effect of delaying, deferring or preventing a change in our control
of without further action by the stockholders and may adversely affect the
voting and other rights of the holders of common stock. At present, we have
no plans to issue any preferred stock nor adopt any series, preferences or
other classification of preferred stock.
The issuance of shares of preferred stock, or the issuance of rights to
purchase such shares, could be used to discourage an unsolicited acquisition
proposal. For instance, the issuance of a series of preferred stock might
impede a business combination by including class voting rights that would
enable the holder to block such a transaction, or facilitate a business
combination by including voting rights that would provide a required
percentage vote of the stockholders. In addition, under certain
circumstances, the issuance of preferred stock could adversely affect the
voting power of the holders of the common stock. Although the Board of
Directors is required to make any determination to issue such stock based on
its judgment as to the best interests of the our stockholders, the Board of
Directors could act in a manner that would discourage an acquisition attempt
or other transaction that some, or a majority, of the stockholders might
believe to be in their best interests or in which stockholders might receive
a premium for their stock over the then market price of such stock. The Board
of Directors does not at present intend to seek stockholder approval prior to
any issuance of currently authorized stock, unless otherwise required by law
or stock exchange rules. We have no present plans to issue any preferred
stock.
Dividends
Dividends, if any, will be contingent upon our revenues and earnings, if
any, capital requirements and financial conditions. The payment of dividends,
if any, will be within the discretion of our Board of Directors. We presently
intend to retain all earnings, if any, for use in our business operations and
accordingly, the Board of Directors does not anticipate declaring any
dividends prior to a business combination.
Blue Sky Considerations
The proposed business activities described herein classify the company
as a "blank check" company. The Securities and Exchange Commission and many
states have enacted statutes, rules and regulations limiting the sale of
securities of blank check companies in their respective jurisdictions.
Management does not intend to issue, offer, sale or undertake any efforts to
cause a market to develop in the company's securities until such time as the
company has successfully implemented its business plan described herein.
<PAGE>
Trading of Securities in Secondary Market
The National Securities Market Improvement Act of 1996 limited the
authority of states to impose restrictions upon sales of securities made
pursuant to Sections 4(1) and 4(3) of the Securities Act of companies which
file reports under Sections 13 or 15(d) of the Exchange Act. Upon
effectiveness of this Registration Statement, we will be required to, and
will, file reports under Section 13 of the Exchange Act. As a result, sales
of our common stock in the secondary market by the holders thereof may then
be made pursuant to Section 4(l) of the Securities Act (sales other than by
an issuer, underwriter or broker).
Following a business combination, a Target Company will normally wish to
list our common stock for trading in one or more United States markets. The
Target Company may elect to apply for such listing immediately following the
business combination or at some later time.
In order to qualify for listing on the NASDAQ SmallCap Market, a company
must have at least (i) net tangible assets of $4,000,000 or market
capitalization of $50,000,000 or net income for two of the last three years
of $750,000; (ii) public float of 1,000,000 shares with a market value of
$5,000,000; (iii) a bid price of $4.00; (iv) three market makers; (v) 300
stockholders and (vi) an operating history of one year or, if less than one
year, $50,000,000 in market capitalization. For continued listing on the
NASDAQ SmallCap Market, a company must have at least (i) net tangible assets
of $2,000,000 or market capitalization of $35,000,000 or net income for two
of the last three years of $500,000; (ii) a public float of 500,000 shares
with a market value of $1,000,000; (iii) a bid price of $1.00; (iv) two
market makers; and (v) 300 stockholders.
If, after a business combination, we do not meet the qualifications for
listing on the NASDAQ SmallCap Market, we may apply for quotation of our
securities on the NASD Over-The-Counter Bulletin Board. In certain cases we
may elect to have our securities initially quoted in the "pink sheets"
published by the National Quotation Bureau, Inc.
Transfer Agent
It is anticipated that we will act as our own transfer agent for our
common stock.
GLOSSARY
"Blank Check" Company As defined in Section 7(b)(3) of the
Securities Act, a "blank check" company is a
development stage company that has no
specific business plan or purpose or has
indicated that its business plan is to
engage in a merger or acquisition with an
<PAGE>
unidentified company or companies and is
issuing "penny stock" securities as defined
in Rule 3a51-1 of the Exchange Act.
Business Combination Normally a merger, stock-for-stock exchange
or stock-for-assets exchange between the
Registrant and a Target Company.
The Company or the Registrant. The corporation whose common stock is the
subject of this Registration Statement.
Exchange Act The Securities Exchange Act of
1934, as amended.
"Penny Stock" Security As defined in Rule 3a51-1 of the Exchange
Act, a "penny stock" security is any equity
security other than a security (i) that is a
reported security (ii) that is issued by an
investment company (iii) that is a put or
call issued by the option Clearing
Corporation (iv) that has a price of $5.00
or more (except for purposes of Rule 419 of
the Securities Act) (v) that is registered
on a national securities exchange (vi) that
is authorized for quotation on the NASDAQ
Stock Market, unless other provisions of
Rule 3a51-1 are not satisfied, or (vii) that
is issued by an issuer with (a) net tangible
assets in excess of $2,000,000, if in
continuous operation for more than three
years or $5,000,000 if in operation for less
than three years or (b) average revenue of
at least $6,000,000 for the last three
years.
Securities Act The Securities Act of 1933, as amended.
PART II
ITEM 1. MARKET PRICE FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
(A) Market Price. There is no trading market for our Common Stock at
present and there has been no trading market to date. There is no assurance
that a trading market will ever develop or, if such a market does develop,
that it will continue.
The Securities and Exchange Commission has adopted Rule 15g-9, which
establishes the definition of a "penny stock," for purposes relevant to the
company, as any equity security that has a market price of less than $5.00
per share or with an exercise price of less than $5.00 per share, subject to
certain exceptions. For any transaction involving a penny stock, unless
exempt, the rules require: (i) that a broker or dealer approve a person's
<PAGE>
account for transactions in penny stocks and (ii) the broker or dealer
receive from the investor a written agreement to the transaction, setting
forth the identity and quantity of the penny stock to be purchased. In order
to approve a person's account for transactions in penny stocks, the broker or
dealer must (i) obtain financial information and investment experience and
objectives of the person; and (ii) make a reasonable determination that the
transactions in penny stocks are suitable for that person and that person has
sufficient knowledge and experience in financial matters to be capable of
evaluating the risks of transactions in penny stocks. The broker or dealer
must also deliver, prior to any transaction in a penny stock, a disclosure
schedule prepared by the Commission relating to the penny stock market,
which, in highlight form, (i) sets forth the basis on which the broker or
dealer made the suitability determination and (ii) that the broker or dealer
received a signed, written agreement from the investor prior to the
transaction. Disclosure also has to be made about the risks of investing in
penny stocks in both public offerings and in secondary trading, and about
commissions payable to both the broker-dealer and the registered
representative, current quotations for the securities and the rights and
remedies available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements have to be sent disclosing recent
price information for the penny stock held in the account and information on
the limited market in penny stocks.
(B) Holders. There is one holder of our Common Stock. The issued and
outstanding shares of our Common Stock were issued in accordance with the
exemptions from registration afforded by Section 4(2) of the Securities Act
of 1933 promulgated there under.
(C) Dividends. We have not paid any dividends to date, and have no
plans to do so in the immediate future.
ITEM 2. LEGAL PROCEEDINGS.
There is no litigation pending or threatened by or against us.
ITEM 3.CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
We have not changed accountants since our formation and there are no
disagreements with the findings of our accountants.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
Since inception, we have not sold any securities.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to Nevada Revised Statutes Section 78.7502 and 78.751 our
Articles of Incorporation and bylaws provide for the indemnification of
present and former directors and officers and each person who serves at our
request as our officer or director. Indemnification for a director is
mandatory and indemnification for an officer, agent or employee is
<PAGE>
permissive. We will indemnify such individuals against all costs, expenses
and liabilities incurred in a threatened, pending or completed action, suit
or proceeding brought because such individual is our director or officer.
Such individual must have conducted himself in good faith and reasonably
believed that his conduct was in, or not opposed to, our best interest. In a
criminal action he must not have had a reasonable cause to believe his
conduct was unlawful. This right of indemnification shall not exclusive of
other rights the individual is entitled to as a matter of law or otherwise.
We will not indemnify an individual adjudged liable due to his
negligence or willful misconduct toward us, adjudged liable to us, or if he
improperly received personal benefit. Indemnification in a derivative action
is limited to reasonable expenses incurred in connection with the proceeding.
Also, we are authorized to purchase insurance on behalf of an individual for
liabilities incurred whether or not we would have the power or obligation to
indemnify him pursuant to our bylaws.
Our bylaws provide that individuals may receive advances for expenses if
the individual provides a written affirmation of his good faith belief that
he has met the appropriate standards of conduct and he will repay the advance
if he is judged not to have met the standard of conduct.
Insofar as indemnification for liabilities arising under the securities act
of 1933, as amended, may be permitted to directors, officers or persons
controlling the company pursuant to the foregoing provisions, it is the
opinion of the Securities and Exchange Commission that such indemnification
is against public policy as expressed in the act and is therefore
unenforceable.
<PAGE>
PART F/S
FINANCIAL STATEMENTS.
Set forth below are our audited financial statements from inception
January 18, 2000 and ending January 20, 2000. The following financial
statements are attached to this report and filed as a part thereof.
TABLE OF CONTENTS
PAGE
INDEPENDENT AUDITORS' REPORT F-1
BALANCE SHEET F-2
STATEMENT OF OPERATIONS F-3
STATEMENT OF STOCKHOLDERS' EQUITY F-4
STATEMENT OF CASH FLOWS F-5
NOTES TO FINANCIAL STATEMENTS F-6-F-7
<PAGE>
BARRY L. FRIEDMAN, P.C.
Certified Public Accountant
1582 TULITA DRIVE OFFICE (702) 361-8414
LAS VEGAS, NEVADA 89123 FAX NO. (702) 896-0278
INDEPENDENT AUDITORS' REPORT
Board Of Directors January 21, 2000
CALIF ACQUISITIONS, INC.
Las Vegas, Nevada
I have audited the Balance Sheet of CALIF ACQUISITIONS, INC., (A
Development Stage Company), as of January 20, 2000, and the related
Statements of Operations, Stockholders' Equity and Cash Flows for the period
January 18, 2000, (inception) to January 20, 2000. These financial statements
are the responsibility of the Company's management. My responsibility is to
express an opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audit provides a
reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of CALIF
ACQUISITIONS, INC., (A Development Stage Company), at January 20, 2000, and
the results of its operations and cash flows for the period January 18, 2000,
(inception) to January 20, 2000, in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note #3 to the
financial statements, the Company has no established source of revenue. This
raises substantial doubt about its ability to continue as a going concern.
Management's plan in regard to these matters are also described in Note #3.
The financial statements do not include any adjustments that might result
from the outcome of this uncertainty.
Barry L. Friedman
Certified Public Accountant
<PAGE>
<TABLE>
CALIF ACQUISITIONS, INC.
(A Development Stage Company)
January 20, 2000
BALANCE SHEET
ASSETS
<S> <C>
CURRENT ASSETS $ 0
-------------------
TOTAL CURRENT ASSETS $ 0
-------------------
OTHER ASSETS $ 0
-------------------
TOTAL OTHER ASSETS $ 0
-------------------
TOTAL ASSETS $ 0
===========
</TABLE>
<TABLE>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C>
CURRENT LIABILITIES
Officers Advances (Note #6) $ 1,167
------------------
TOTAL CURRENT LIABILITIES $ 1,167
------------------
STOCKHOLDERS' EQUITY
Preferred stock, $.001 par value
authorized 5,000,000 shares
issued and outstanding at
January 20, 2000-None $ 0
Common stock, $.001 par value,
authorized 20,000,000 shares;
issued and outstanding at
January 20, 2000-5,000,000 shares $ 5,000
Additional paid-in capital 0
Deficit accumulated during
development stage (6,167)
-------------------
TOTAL STOCKHOLDER'S EQUITY $ (1,167)
-------------------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 0
============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
CALIF ACQUISITIONS, INC.
(A Development Stage Company)
January 18, 2000,(Inception) to January 20, 2000
STATEMENT OF OPERATIONS
<S> <C>
INCOME
Revenue $ 0
--------------------
EXPENSE
General and
Administrative $ 5,885
Organization Cost Expense 282
--------------------
TOTAL EXPENSES $ 6,167
--------------------
NET LOSS $ (6,167)
============
Net Loss
Per Share $ (.0012)
============
Weighted average
number of common
shares outstanding 5,000,000
=============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
CALIF ACQUISITIONS, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
Deficit
accumulated
Additional during
Common Stock paid-in development
Capital stage
Shares Amount
---------- ---------- ---------- -------------
<S> <C> <C> <C> <C>
January 18, 2000
issued for services 5,000,000 $ 5,000 $ 0 $ 0
Net loss, January
18, 2000 (inception)
to January 20, 2000 (6,167)
---------- ----------- ---------- -------------
Balance,
January 20, 2000 5,000,000 $ 5,000 $ 0 $ (6,167)
======== ======== ========== ============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
CALIF ACQUISITIONS, INC.
(A Development Stage Company)
January 18, 2000,(Inception) to January 20, 2000
STATEMENT OF CASH FLOWS
<S> <C>
Cash Flows from
Operating Activities
Net loss $ (6,167)
Amortization 282
Issue common stock for services 5,000
Changes in assets and
Liabilities
Officers Advances 1,167
---------------------
Net cash used in
operating activities $ 282
Cash Flows from
Investing Activities 0
Organization Costs (282)
Cash Flows from
Financing Activities 0
------------------------
Net increase in cash $ 0
Cash,
beginning of period 0
-----------------------
Cash,
end of period $ 0
==============
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
CALIF ACQUISITIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
January 20, 2000
NOTE 1 - HISTORY AND ORGANIZATION OF THE COMPANY
The Company was organized January 18, 2000, under the laws of the State
of Nevada, as CALIF ACQUISITIONS, INC. The Company currently has no
operations and, in accordance with SFAS #7, is considered a development stage
company.
On January 18, 2000, the Company issued 5,000,000 shares of its $.001
par value common stock for services of $5,000.
NOTE 2 - ACCOUNTING POLICIES AND PROCEDURES
Accounting policies and procedures have not been determined except as
follows:
1. The Company uses the accrual method of accounting.
2. Earnings per share is computed using the weighted average number of
common shares outstanding.
3. The Company has not yet adopted any policy regarding payment of
dividends. No dividends have been paid since inception.
4. In April 1998, the American Institute of Certified Public
Accountant's issued Statement of Position 98-5 ("SOP 98-511), Reporting on
the Costs of Start-Up Activities" which provides guidance on the financial
reporting of start-up costs and organization costs. It requires costs of
start-up activities and organization costs to be expensed as incurred. SOP
98-5 is effective for fiscal years beginning after December 15, 1998, with
initial adoption reported as the cumulative effect of a change in accounting
principle. With the adoption of SOP 98-5, there has been little or no effect
on the Company's financial statements.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using the generally
accepted accounting principles applicable to a going concern, which
contemplates the realization of assets and liquidation of liabilities in the
normal course of business. However, the Company has no current source of
revenue. Without realization of additional capital, it would be unlikely for
the Company to continue as a going concern. It is management's plan to seek
additional capital through a merger with an existing operating company
<PAGE>
CALIF ACQUISITIONS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS CONTINUED
January 20, 2000
NOTE 4 - RELATED PARTY TRANSACTION
The Company neither owns or leases any real or personal property. Office
services are provided without charge by a director. Such costs are immaterial
to the financial statements and, accordingly, have not been reflected
therein. The officers and directors of the Company are involved in other
business activities and may, in the future, become involved in other business
opportunities. If a specific business opportunity becomes available, such
persons may face a conflict in selecting between the Company and their other
business interests. The Company has not formulated a policy for the
resolution of such conflicts.
NOTE 5 - WARRANTS AND OPTIONS
There are no warrants or options outstanding to issue any additional
shares of common or preferred stock of the Company.
NOTE 6 - OFFICERS ADVANCES
While the Company is seeking additional capital through a merger with
an existing operating company, an officer of the Company has advanced funds
on behalf of the Company to pay for any costs incurred by it. These funds are
interest free.
<PAGE>
PART III
ITEM 1. INDEX TO EXHIBITS.
Exhibit
Number Description
(3)(i) Articles of Incorporation
(a) Articles of Incorporation
(3)(ii) Bylaws
(a) Bylaws
(4) Instrument defining the rights of security holders:
(a) Articles of Incorporation
(b) Bylaws
(c) Stock Certificate Specimen
(24) Consent of expert
(a) Auditors
(27) Financial Data Schedule
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the Registrant caused this Registration Statement to be signed on its behalf
by the undersigned thereunto duly authorized.
CALIF ACQUISITIONS, INC.
By:/s/ Anthony DeMint
Anthony N. DeMint, Director and President
April 18, 2000
Las Vegas, NV
