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As filed with the Securities and Exchange Commission on May 31, 2000
Registration No. 333-33854
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 1
To
FORM SB-2
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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BentleyCapitalCorp.com Inc.
(Exact name of small business issuer in its charter)
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<S> <C> <C>
Washington 5499 91-2022700
(State or other jurisdiction of (primary standard (I.R.S. Employer
incorporation or organization) industrial code) Identification Number)
</TABLE>
1177 West Hastings, Suite 2110
Vancouver, British Columbia V6E 2K3, CANADA
(604) 687-2199
(Address and telephone number of principal executive offices)
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Agent for Service: With a Copy to:
Michael Kirsh, President James L. Vandeberg
BentleyCapitalCorp.com Inc. Ogden Murphy Wallace, PLLC
1177 West Hastings, Suite 2110 1601 Fifth Avenue, Suite 2100
Vancouver, British Columbia V6E 2K3, CANADA Seattle, Washington 98101
(604) 687-2199 (206) 447-7000
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(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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(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,
check the following box. [_]
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Amount maximum maximum Amount of
Title of each class of to be offering price aggregate registration
securities to be registered registered per unit offering price fee
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Class A Common Stock............ 500,000 $.01 $5,000.00 $1.32(1)
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(1) Previously paid.
Note: Specific details relating to the fee calculation shall be furnished in
notes to the table, including references to provisions of Rule 457 (Section
230.457 of this chapter) relied upon, if the basis of the calculation is not
otherwise evident from the information presented in the table. If the filing
fee is calculated pursuant to Rule 457(o) under the Securities Act, only the
title of the class of securities to be registered, the proposed maximum
aggregate offering price for that class of securities and the amount of
registration fee needed to appear in the Calculation of Registration Fee table.
Any difference between the dollar amount of securities registered for such
offerings and the dollar amount of securities sold may be carried forward on a
future registration statement pursuant to Rule 429 under the Securities Act.
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The registration hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ +
+We will amend and complete the information in this prospectus. 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 these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
+ +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION--[enter date, 2000]
PROSPECTUS
, 2000
BentleyCapitalCorp.com Inc.
1177 West Hastings, Suite 2110
Vancouver, British Columbia V6E 2K3, CANADA
(604) 687-2199
500,000 Shares of Common Stock
This is the initial public offering of common stock of BentleyCapitalCorp.com
Inc., and no public market currently exists for shares of
BentleyCapitalCorp.com's common stock. The initial public offering price is
$0.01 per share of common stock. The offering is on a best efforts--no minimum
basis. There is no date certain for closing the offering, no minimum purchase
requirement, and no arrangement to place funds in an escrow, trust, or similar
account.
-----------
This investment involves a high degree of risk.
See "Risk Factors" beginning on Page 2.
-----------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
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TABLE OF CONTENTS
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Page
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PART I--PROSPECTUS
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PROSPECTUS SUMMARY....................................................... 1
RISK FACTORS............................................................. 2
USE OF PROCEEDS.......................................................... 9
DETERMINATION OF OFFERING PRICE.......................................... 9
SELLING SECURITY HOLDERS................................................. 9
PLAN OF DISTRIBUTION..................................................... 9
LEGAL PROCEEDINGS........................................................ 9
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS............. 10
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT........... 10
DESCRIPTION OF SECURITIES................................................ 11
INTEREST OF NAMED EXPERTS AND COUNSEL.................................... 11
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES............................................................. 11
DESCRIPTION OF BUSINESS.................................................. 12
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION................ 19
DESCRIPTION OF PROPERTY.................................................. 21
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS........................... 21
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS................. 21
EXECUTIVE COMPENSATION................................................... 21
FINANCIAL STATEMENTS..................................................... F-1
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE.............................................................. F-7
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<PAGE>
PROSPECTUS SUMMARY
BentleyCapitalCorp.com
BentleyCapitalCorp.com Inc. is a corporation formed under the laws of the
State of Washington, whose principal executive offices are located in
Vancouver, British Columbia, Canada.
The primary objective of the business is designed to market high-quality,
low-cost vitamins, minerals, nutritional supplements, and other health and
fitness products to medical professionals, alternative health professionals,
martial arts studios and instructors, sports and fitness trainers, other health
and fitness professionals, school and other fund raising programs and other
similar types of customers via the Internet for sale to their clients.
Name, Address, and Telephone Number of Registrant
BentleyCapitalCorp.com Inc.
1177 West Hastings, Suite 2110
Vancouver, British Columbia V6E 2K3, CANADA
(604) 687-2199
(604) 687-8360
The Offering
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Price per share Offered..................................... $0.01
Common Stock Offered by BentleyCapitalCorp.com.............. 500,000 shares
Common Stock Outstanding Prior to Offering.................. 2,500,000 shares
Common Stock Outstanding After Offering*.................... 3,000,000 shares
</TABLE>
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* Assumes sale of all shares offered
BentleyCapitalCorp.com expects to use the net proceeds for organizational
purposes and to determine the feasibility of selling Vitamineralherb.com
products to specific markets.
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RISK FACTORS
You should carefully consider the following risk factors and all other
information contained in this prospectus before purchasing the common stock of
BentleyCapitalCorp.com. Investing in BentleyCapitalCorp.com's common stock
involves a high degree of risk. Any of the following risks could adversely
affect BentleyCapitalCorp.com's business, financial condition and results of
operations and could result in a complete loss of your investment.
You Should Not Rely on Forward-Looking Statements Because They Are Inherently
Uncertain
You should not rely on forward-looking statements in this prospectus. This
prospectus contains forward-looking statements that involve risks and
uncertainties. We use words such as "anticipates", "believes", "plans",
"expects", "future", "intends" and similar expressions to identify these
forward-looking statements. Prospective investors should not place undue
reliance on forward-looking statements, which apply only as of the date of this
prospectus. BentleyCapitalCorp.com's actual results could differ materially
from those anticipated in these forward-looking statements for many reasons,
including the risks faced by BentleyCapitalCorp.com described in "Risk Factors"
and elsewhere in this prospectus.
Risks Related to BentleyCapitalCorp.com's Business
BentleyCapitalCorp.com Has Incurred Losses Since Its Inception March 14, 2000
and Expects Losses to Continue For the Foreseeable Future
BentleyCapitalCorp.com is in the extreme early stages of development and
could fail before implementing its business plan. It is a "start up" venture
that will incur net losses for the foreseeable future. BentleyCapitalCorp.com
has only recently acquired its principal asset. BentleyCapitalCorp.com will
incur additional expenses before becoming profitable, if it ever becomes
profitable. It is a relatively young company that has no history of earnings or
profit. There is no assurance that it will operate profitably in the future or
provide a return on investment in the future.
BentleyCapitalCorp.com's Sole Shareholder May Devote More Resources to Other
Companies He Owns
BentleyCapitalCorp.com's sole shareholder, officer and director, Michael
Kirsh, is also the sole shareholder, officer and director of a company with a
similar distribution license for another territory. The license for other
territory may prove more lucrative than BentleyCapitalCorp.com's territory, and
it is possible that Mr. Kirsh could devote more time and resources to the other
company at the expense of BentleyCapitalCorp.com.
Changes or Interruptions to BentleyCapitalCorp.com's Arrangements with Its
Supplier May Have an Adverse Effect on Its Ability to Operate
If BentleyCapitalCorp.com's licensor defaults under its agreement with its
supplier, BentleyCapitalCorp.com could lose access to its manufacturing source,
and BentleyCapitalCorp.com's distribution rights would become meaningless.
Similarly, any dispute between the supplier and licensor could prevent
BentleyCapitalCorp.com from selling or delivering product to its customers. Any
termination or impairment of BentleyCapitalCorp.com's license rights and access
to products could prevent BentleyCapitalCorp.com from implementing its business
plan, thereby limiting its profitability and decreasing the value of its stock.
BentleyCapitalCorp.com Will Compete With Other Internet Retailers and May Not
Achieve the Customer Base Necessary to Become or Remain Profitable
BentleyCapitalCorp.com's future revenues and profits, if any, substantially
depend upon the widespread acceptance and use of the Internet as an effective
medium of business by target consumers. Consumers may not choose to do business
over the Internet in sufficient number to establish the customer base necessary
to obtain
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revenues and achieve profitable operations. Even if use of the Internet and
electronic commerce continues to increase, the online vitamins market may not
develop. BentleyCapitalCorp.com may therefore be unable to successfully market
and sell its product, in which case it would not become profitable.
BentleyCapitalCorp.com Must Rely On Its Licensor to Provide Critical Services.
Failure of the Licensor to Supply a Service Will Hamper
BentleyCapitalCorp.com's Ability to Do Business
As part of its license, BentleyCapitalCorp.com's licensor has agreed to
provide and maintain (1) a website through which orders are placed and (2) a
payment system for receipt of payments from customers and disbursement of funds
to BentleyCapitalCorp.com and its supplier. If the licensor fails to provide
these services, BentleyCapitalCorp.com may be unable to conduct its business.
If BentleyCapitalCorp.com is unable to conduct its business, it may lose
customers and revenues. BentleyCapitalCorp.com's future success will depend, in
part, on the licensor's use of leading technologies to provide seamless access
to and services through its website. The licensor's network infrastructure may
be vulnerable to computer viruses, hacking or similar disruptive problems
caused by users, other connected Internet sites, instabilities in the Internet,
interconnecting networks and various telephone networks. Computer viruses or
problems caused by third parties could lead to interruptions, delays or
cessation in service to BentleyCapitalCorp.com. If the licensor does not
maintain an up-to-date, effective website, BentleyCapitalCorp.com may not be
effective in its online sales.
BentleyCapitalCorp.com Relies On Third Parties to Supply Telecommunications
Services And Any Interruption of These Services May Have An Adverse Effect On
Its Ability to Operate
BentleyCapitalCorp.com will rely on its licensor's providers such as the
local telephone companies and other companies to provide data-communications
via local telecommunications lines and leased long-distance lines. The means of
ordering and paying for products may be disrupted or eliminated if the licensor
experiences disruptions or capacity constraints in its telecommunications
services. BentleyCapitalCorp.com or its licensor may be unable to replace these
services on a timely basis or at all. If customer sales are disrupted,
BentleyCapitalCorp.com will lose customers and profitability.
Government Regulation of the Internet Could Adversely Affect
BentleyCapitalCorp.com's Profitability
Existing or future legislation could limit growth in use of the Internet,
which would curtail BentleyCapitalCorp.com's revenue growth. Any new regulation
of Internet commerce could damage BentleyCapitalCorp.com's business, affect the
profitability and perhaps the viability of its business plan, and cause the
price of its common stock to decline. Regulation could prove to be burdensome,
and impose significant additional costs on BentleyCapitalCorp.com's business or
subject it to additional liabilities. Regulation is likely in the areas of user
privacy, pricing, content, and quality of products and services. Laws and
regulations applying to the solicitation, collection, or processing of personal
or consumer information could limit BentleyCapitalCorp.com's activities. In
addition, any regulation imposing fees for Internet use could result in a
decline in the use of the Internet and the viability of Internet commerce,
which could have a material adverse effect on BentleyCapitalCorp.com's
business, results of operations, and financial condition.
New Taxation Could Adversely Affect BentleyCapitalCorp.com's Profitability
Canadian, U.S., or other local or foreign jurisdictions may seek to impose
sales tax collection obligations on BentleyCapitalCorp.com for its sales over
the Internet. If one or more states or any foreign country successfully asserts
that BentleyCapitalCorp.com should collect sales or other taxes on the sale of
its products, it could also prevent BentleyCapitalCorp.com's business from
growing or expose it to unanticipated liabilities. Taxation of Internet use, or
other charges imposed by government agencies or by private organizations for
accessing the Internet, may also be imposed. Customers may not be willing to
pay the higher prices necessitated by a tax, or may choose to purchase products
from a company that is not subject to the tax. Any taxation could cause loss of
customers and a decrease in BentleyCapitalCorp.com's profitability.
3
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Government Regulation of Products Could Adversely Affect Viability of Dietary
Supplements
In Canada, extensive federal government regulations may restrict the way
BentleyCapitalCorp.com sells its products, resulting in restrictions on the
products and content BentleyCapitalCorp.com offers its customers and
significant additional expenses. Numerous Canadian governmental agencies may
regulate the manufacture, packaging, labeling, advertising, promotion,
distribution and sale of BentleyCapitalCorp.com's products. The primary
regulatory agency is Health Canada, which regulates BentleyCapitalCorp.com's
products under the Food and Drugs Act and associated regulations.
Canadian laws, regulations and enforcement policies governing
BentleyCapitalCorp.com's dietary supplement products are relatively new and
still evolving and BentleyCapitalCorp.com cannot predict what enforcement
positions Health Canada or Industry Canada may take with respect to
BentleyCapitalCorp.com's selling methods. Health Canada has established a new
Office of National Health Products which will evaluate health products for
assurance of safety while enhancing consumer access and choice to a full range
of natural health products. Office of National Health Products will be a new
regulatory authority reporting to the Assistant Deputy Minister, Health
Protections Branch. Until the new regulatory framework has been established
under the Office of National Health Products, natural health products will
continue to be regulated either as foods or drugs.
U.S. federal, state and local government regulations may also restrict
BentleyCapitalCorp.com's products. The U.S. Food and Drug Administration
regulates BentleyCapitalCorp.com's products under the Federal Food, Drug and
Cosmetic Act and regulations promulgated thereunder. BentleyCapitalCorp.com's
products are also subject to regulation by, among other regulatory entities,
the Consumer Product Safety Commission, the U.S. Department of Agriculture, and
the Environmental Protection Agency. The U.S. Federal Trade Commission
regulates advertising and other forms of promotion and methods of marketing of
BentleyCapitalCorp.com's products under the Federal Trade Commission Act.
Various provincial, state and local agencies may also regulate the manufacture,
labeling and advertising of BentleyCapitalCorp.com's products.
BentleyCapitalCorp.com cannot be certain that its attempts, or those of its
suppliers, to comply with laws and regulations in this area are or will be
deemed sufficient by the appropriate regulatory agencies. Enforcement actions
by any of these regulatory agencies can result in civil and criminal penalties,
an injunction to stop or modify certain selling methods, seizure of
BentleyCapitalCorp.com's products, adverse publicity or voluntary recalls and
labeling changes. If any governmental agency were to undertake an enforcement
action against BentleyCapitalCorp.com, it could cause an immediate decrease in
its revenues, cause it to incur significant additional expenses and result in a
decrease in its stock price. BentleyCapitalCorp.com's efforts to comply with
existing laws and regulations may be costly, may force it to change its selling
strategy and may not be successful. BentleyCapitalCorp.com cannot promise that
it will be able to comply with any existing or future laws, regulations,
interpretations or applications without incurring significant costs or
adjusting its business model.
Purchasers Must Rely on Mr. Kirsh's Abilities For All Decisions As He Will
Control the Majority of the Stock After the Offering. BentleyCapitalCorp.com
Has No Employment Agreement With Mr. Kirsh and He Spends Only Part-time On Its
Business. His Leaving May Adversely Effect BentleyCapitalCorp.com's Ability To
Operate
Mr. Kirsh is serving as BentleyCapitalCorp.com's sole officer and director.
BentleyCapitalCorp.com will be heavily dependent upon Mr. Kirsh's
entrepreneurial skills and experience to implement its business plan and may,
from time to time, find that his inability to devote full time and attention to
its affairs will result in delay(s) in progress towards the implementation of
its business plan or in a failure to implement its business plan. Moreover,
BentleyCapitalCorp.com does not have an employment agreement with Mr. Kirsh and
as a result, there is no assurance that he will continue to manage its affairs
in the future. Nor has BentleyCapitalCorp.com obtained a key man life insurance
policy on Mr. Kirsh. BentleyCapitalCorp.com could lose the services of Mr.
Kirsh, or Mr. Kirsh could decide to join a competitor or otherwise compete
directly or indirectly with BentleyCapitalCorp.com, which would have a
significant adverse effect on its business and could cause the price of its
stock to be worthless. The services of Mr. Kirsh would be difficult to replace.
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Mr. Kirsh Has No Experience in BentleyCapitalCorp.com's Line of Business and
May Make Poor Business Decisions Which May Adversely Effect Its Business
Mr. Kirsh has no experience in marketing and retail sale of vitamins and
other nutritional supplements, or the sale of products over the Internet. Mr.
Kirsh is not a doctor, nutritionist, or health professional by trade. As a
result, BentleyCapitalCorp.com will likely need to rely on others who
understand the sale and marketing of nutritional supplements. Because of lack
of experience in this line of business, BentleyCapitalCorp.com may
overestimate the marketability of the Vitamineralherb.com products and may
underestimate the costs and difficulties associated with selling and
distributing of the products. Any such unanticipated costs or difficulties
could prevent BentleyCapitalCorp.com from implementing its business plan,
thereby limiting its profitability and decreasing the value of its stock.
BentleyCapitalCorp.com May Be Subject to Product Liability Suits Which Could
Adversely Effect Its Financial Condition
BentleyCapitalCorp.com may be subject to product liability claims if any of
the products it sells results in injury. BentleyCapitalCorp.com may be
subjected to various product liability claims, including, among others, that
its products include inadequate instructions for use or inadequate warnings
concerning possible side effects and interactions with other substances.
BentleyCapitalCorp.com relies on third party manufacturers for its products
and product disclosures. BentleyCapitalCorp.com has no product liability
insurance coverage. Although its licensor warrants the products and provides
indemnification to BentleyCapitalCorp.com for losses, claims, and expenses
arising from a breach of the product warranties, any such indemnification is
limited by its terms and, as a practical matter, is limited to the
creditworthiness of the indemnifying party. In the event that
BentleyCapitalCorp.com does not have adequate indemnification, product
liability claims could be costly and divert management's attention from
business.
Unfavorable Publicity May Curtail the Market for BentleyCapitalCorp.com's
Products
The dietary supplement market is affected by national media attention
regarding the consumption of dietary supplements. BentleyCapitalCorp.com is
highly dependent upon consumers' perceptions of the safety and quality of its
products as well as dietary supplements distributed by other companies. Any
negative publicity asserting that these products may be harmful or questioning
their efficacy could have a material adverse effect on
BentleyCapitalCorp.com's business, regardless of whether these reports are
scientifically supported or whether the claimed harmful effects would be
present at the dosages recommended for these products. Because of
BentleyCapitalCorp.com's dependence on consumers' perceptions, adverse
publicity associated with illness or other adverse effects resulting from the
consumption of its products or any similar products distributed by other
companies and future reports of research that are perceived as less favorable
or that question earlier research could have a material adverse effect on
BentleyCapitalCorp.com's sales and therefore its profitability.
BentleyCapitalCorp.com Will Compete With Other Vitamin Retailers and May Not
Achieve the Customer Base Necessary to Become or Remain Profitable
The electronic commerce industry is new, rapidly evolving and intensely
competitive, and BentleyCapitalCorp.com expects competition to intensify in
the future. Barriers to entry are minimal and current and new competitors can
launch sites at a relatively low cost. In addition, the vitamin market is very
competitive and highly fragmented, with no clear dominant leader and
increasing public and commercial attention. BentleyCapitalCorp.com competes
with a variety of other companies, including traditional vitamin retailers,
the online retail initiatives of several traditional retailers and other
Vitamineralherb.com licensees. Many of BentleyCapitalCorp.com's potential
competitors have longer operating histories, larger customer or user bases,
greater brand recognition and significantly greater financial, marketing and
other resources than BentleyCapitalCorp.com has. In addition, an online
retailer may be acquired by, receive investments from, or enter into other
commercial relationships with, larger, well-established and well-financed
companies as use of the Internet and other electronic services increases.
Competitors have and may continue to adopt aggressive
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pricing or inventory availability policies and devote substantially more
resources to website and systems development than BentleyCapitalCorp.com does.
Increased competition may result in reduced operating margins and loss of
market share.
Acquisition of or Combination with Another Company Could Dilute Stockholder
Value
Because BentleyCapitalCorp.com may not be successful in developing a viable
market for the Vitamineralherb.com products, its management will spend a
significant portion of the time it devotes to evaluating other business
opportunities that may be available to BentleyCapitalCorp.com. In the event of
a business combination, the ownership interests of holders of existing shares
of BentleyCapitalCorp.com's stock will be diluted. Due to its limited financial
resources, the only way BentleyCapitalCorp.com will be able to diversify its
activities, should its business plan prove to be impractical, would be to enter
into a business combination.
Any asset acquisition or business combination would likely include the
issuance of a significant amount of BentleyCapitalCorp.com's common stock,
which would dilute the ownership interest of holders of existing shares, and
may result in a majority of the voting power being transferred to new
investors. Depending on the nature of the transaction, BentleyCapitalCorp.com's
stockholders may not have an opportunity to vote on whether to approve it. For
example, BentleyCapitalCorp.com's board of directors may decide to issue a
significant amount of stock to effect a share exchange with another company.
Such a transaction does not require shareholder approval, but
BentleyCapitalCorp.com's officers and directors must exercise their powers in
good faith and with a view to the interests of the corporation.
Acquisition of or Combination with Another Company Could Be Difficult To
Integrate and Disrupt Business
Any acquisition of or business combination with another company could
disrupt BentleyCapitalCorp.com's ongoing business, distract management and
employees and increase its expenses. If BentleyCapitalCorp.com acquires a
company, it could face difficulties in assimilating that company's personnel
and operations. In addition, the key personnel of the acquired company may
decide not to work for BentleyCapitalCorp.com. Acquisitions also involve the
need for integration into existing administration, services, marketing, and
support efforts. Any amortization of goodwill or other assets, or other charges
resulting from the costs of these acquisitions, could limit
BentleyCapitalCorp.com's profitability and decrease the value of its stock. In
addition, BentleyCapitalCorp.com's liquidity and capital resources may be
diminished prior to or as a result of consummation of a business combination
and its capital may be further depleted by the operating losses (if any) of the
business entity which BentleyCapitalCorp.com may eventually acquire.
BentleyCapitalCorp.com May Enter In To New Line of Business Which Investors
Could Not Evaluate
In the event of a business combination, acquisition, or change in
shareholder control, BentleyCapitalCorp.com may enter in to a new line of
business which an investor did not anticipate and in which that investor may
not want to participate. BentleyCapitalCorp.com may make investments in or
acquire complementary products, technologies and businesses, or businesses
completely unrelated to its current business plan. Similarly, an asset
acquisition or business combination would likely include the issuance of a
significant amount of BentleyCapitalCorp.com's common stock, which may result
in a majority of the voting power being transferred to new investors. New
investors may replace BentleyCapitalCorp.com's management. New management may
decide not to continue to implement BentleyCapitalCorp.com's current business
plan, and may decide to enter into a business completely unrelated to the
current business plan which an investor did not anticipate and in which that
investor may not want to participate. In such case, an investor could lose its
entire investment on a business decision it did not get to evaluate at the time
of investing in BentleyCapitalCorp.com.
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Financial Risks
BentleyCapitalCorp.com Has No Operating History and Financial Results Are
Uncertain
BentleyCapitalCorp.com is a young company with no history of earnings or
profit and there is no assurance that it will operate profitably in the
future. There is no meaningful historical financial data upon which to base
planned operating expenses. As a result of BentleyCapitalCorp.com's limited
operating history, it is difficult to accurately forecast its potential
revenue. In order to become profitable, BentleyCapitalCorp.com must:
. execute on its business model;
. create brand recognition;
. manage growth in its operations;
. create a customer base cost-effectively;
. retain customers;
. access additional capital when required; and
. attract and retain key personnel.
BentleyCapitalCorp.com cannot be certain that its business model will be
successful or that it will successfully address these and other challenges,
risks and uncertainties. If it fails successfully meet these challenges,
BentleyCapitalCorp.com will likely never become profitable.
BentleyCapitalCorp.com May Need Additional Financing Which May Not Be
Available, or Which May Dilute the Ownership Interests of Investors
BentleyCapitalCorp.com's ultimate success will depend on its ability to
raise additional capital. No commitments to provide additional funds have been
made by management or other shareholders. BentleyCapitalCorp.com has not
investigated the availability, source or terms that might govern the
acquisition of additional financing. When additional capital is needed, there
is no assurance that funds will be available from any source or, if available,
that they can be obtained on terms acceptable to BentleyCapitalCorp.com. If
not available, BentleyCapitalCorp.com's operations would be severely limited,
and it would be unable to implement its business plan.
Investment Risks
BentleyCapitalCorp.com's Common Stock Has No Prior Market, And Prices May
Decline After the Offering
There is no public market for BentleyCapitalCorp.com's common stock and no
assurance can be given that a market will develop or that any shareholder will
be able to liquidate its investment without considerable delay, if at all. The
trading market price of BentleyCapitalCorp.com's common stock may decline
below the offering price. If a market should develop, the price may be highly
volatile. In addition, an active public market for BentleyCapitalCorp.com's
common stock may not develop or be sustained. Factors such as those discussed
in this "Risk Factors" section may have a significant impact on the market
price of BentleyCapitalCorp.com's securities. Owing to the low price of the
securities, many brokerage firms may not be willing to effect transactions in
the securities. Even if a purchaser finds a broker willing to effect a
transaction in BentleyCapitalCorp.com's common stock, the combination of
brokerage commissions, state transfer taxes, if any, and other selling costs
may exceed the selling price. Further, many lending institutions will not
permit the use of these securities as collateral for loans. Thus, a purchaser
may be unable to sell or otherwise realize the value invested in
BentleyCapitalCorp.com stock.
7
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Investors May Face Significant Restrictions on the Resale of
BentleyCapitalCorp.com Stock Due to State Blue Sky Laws
Because BentleyCapitalCorp.com's securities have not been registered for
resale under the blue sky laws of any state, the holders of shares and those
persons desiring to purchase them in any trading market that may develop in the
future should be aware that there may be significant state blue sky law
restrictions on the ability of investors to sell and on purchasers to buy
BentleyCapitalCorp.com's securities. Each state has its own securities laws,
often called "blue sky laws", which limit sales of stock to a state's residents
unless the stock is registered in that state or qualifies for an exemption from
registration, and govern the reporting requirements for broker-dealers and
stock brokers doing business directly or indirectly in the state. Before a
security is sold in a state, there must be a registration in place to cover the
transaction, and the broker must be registered in that state, or otherwise be
exempt from registration. BentleyCapitalCorp.com does not know whether its
stock will be registered under the laws of any states. A determination
regarding registration will be made by the broker-dealers, if any, who agree to
serve as the market-makers for BentleyCapitalCorp.com's stock.
Accordingly, investors should consider the secondary market for
BentleyCapitalCorp.com's securities to be a limited one. Investors may be
unable to resell their stock, or may be unable to resell it without the
significant expense of state registration or qualification.
Investors May Face Significant Restrictions on the Resale of
BentleyCapitalCorp.com Stock Due To Federal Penny Stock Regulations
In addition, the Securities and Exchange Commission has adopted a number of
rules to regulate "penny stocks." These rules include Rules 3a51-1, 15g-1, 15g-
2, 15g-3, 15g-4, 15g-5, 15g-6 and 15g-7 under the Securities and Exchange Act
of 1934, as amended. Because BentleyCapitalCorp.com's securities may constitute
"penny stock" within the meaning of the rules, the rules would apply to
BentleyCapitalCorp.com and its securities. The rules may further affect the
ability of owners of BentleyCapitalCorp.com's shares to sell their securities
in any market that may develop for them. There may be a limited market for
penny stocks, due to the regulatory burdens on broker-dealers. The market among
dealers may not be active. Investors in penny stock often are unable to sell
stock back to the dealer that sold them the stock. The mark ups or commissions
charged by the broker-dealers may be greater than any profit a seller may make.
Because of large dealer spreads, investors may be unable to sell the stock
immediately back to the dealer at the same price the dealer sold the stock to
the investor. In some cases, the stock may fall quickly in value. Investors may
be unable to reap any profit from any sale of the stock, if they can sell it at
all.
Shareholders should be aware that, according to the Securities and Exchange
Commission Release No. 34-29093, the market for penny stocks has suffered in
recent years from patterns of fraud and abuse. These patterns include:
. control of the market for the security by one or a few broker-dealers
that are often related to the promoter or issuer;
. manipulation of prices through prearranged matching of purchases and
sales and false and misleading press releases;
. ""boiler room" practices involving high pressure sales tactics and
unrealistic price projections by inexperienced sales persons;
. excessive and undisclosed bid-ask differentials and markups by selling
broker-dealers; and
. the wholesale dumping of the same securities by promoters and broker-
dealers after prices have been manipulated to a desired level, along with
the inevitable collapse of those prices with consequent investor losses.
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<PAGE>
USE OF PROCEEDS
The net proceeds to BentleyCapitalCorp.com from the sale of the 500,000
shares of common stock offered by BentleyCapitalCorp.com hereby at an assumed
initial public offering price of $.01 per share are estimated to be $5,000.
BentleyCapitalCorp.com expects to use the net proceeds as follows:
<TABLE>
<CAPTION>
Purpose 50% Subscription* 100% Subscription**
------- ----------------- -------------------
<S> <C> <C>
Organizational Purposes............ $1,000 $1,000
Feasibility of License/Market
Research.......................... $1,500 $4,000
</TABLE>
--------
* Assumes sale of 50% of the stock being offered
** Assumes sale of 100% of the stock being offered
BentleyCapitalCorp.com continually evaluates other business opportunities
that may be available to it, whether in the form of assets acquisitions or
business combinations. BentleyCapitalCorp.com may use a portion of the proceeds
for these purposes. BentleyCapitalCorp.com is not currently a party to any
contracts, letters of intent, commitments or agreements and is not currently
engaged in active negotiations with respect to any acquisitions.
BentleyCapitalCorp.com has not yet determined the amount of net proceeds to
be used specifically for any of the foregoing purposes. Accordingly,
BentleyCapitalCorp.com's management will have significant flexibility in
applying the net proceeds of the offering.
DETERMINATION OF OFFERING PRICE
BentleyCapitalCorp.com arbitrarily determined the price of the Units in this
Offering. The offering price is not an indication of and is not based upon the
actual value of BentleyCapitalCorp.com. It bears no relationship to the book
value, assets or earnings of BentleyCapitalCorp.com or any other recognized
criteria of value. The offering price should not be regarded as an indicator of
the future market price of the securities.
SELLING SECURITY HOLDERS
There are no selling security holders.
PLAN OF DISTRIBUTION
BentleyCapitalCorp.com will sell a maximum of 500,000 shares of its common
stock to the public on a "best efforts" basis. There can be no assurance that
any of these shares will be sold. This is not an underwritten offering.
BentleyCapitalCorp.com has not committed to keep the registration statement
effective for any set period of time. The gross proceeds to
BentleyCapitalCorp.com will be $5,000 if all the shares offered are sold. No
commissions or other fees will be paid, directly or indirectly, by
BentleyCapitalCorp.com, or any of its principals, to any person or firm in
connection with solicitation of sales of the shares. No public market currently
exists for shares of BentleyCapitalCorp.com's common stock.
BentleyCapitalCorp.com intends to apply to have its shares traded on the OTC
bulletin board under the symbol "BCCC".
LEGAL PROCEEDINGS
BentleyCapitalCorp.com is not a party to any pending legal proceeding or
litigation and none of its property is the subject of a pending legal
proceeding. Further, the officer and director knows of no legal proceedings
against BentleyCapitalCorp.com or its property contemplated by any governmental
authority.
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DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The following table sets forth the name, age and position of each director
and executive officer of BentleyCapitalCorp.com:
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Michael Kirsh................ 46 President, Secretary, Treasurer, Director
</TABLE>
In March, 2000, Mr. Kirsh was elected as the sole officer and director of
BentleyCapitalCorp.com, of which he is the sole stockholder. He will serve
until the first annual meeting of BentleyCapitalCorp.com's shareholders and his
successors are elected and qualified. Thereafter, directors will be elected for
one-year terms at the annual shareholders' meeting. Officers will hold their
positions at the pleasure of the board of directors, absent any employment
agreement.
During the past five years, Mr. Kirsh has worked with a group of independent
investors that acquires private companies and conducts reverse takeovers. In a
reverse takeover, the shareholders of an acquired company generally end up
owning all or most of the resulting combined company. Before forming his
investment group, Mr. Kirsh had invested in both real estate and the stock
market. From approximately 1986 to 1992 Mr. Kirsh developed two dental
practices in Vancouver, British Columbia, Canada, which he sold in 1992 before
forming his investment group. There are no plans, arrangements, or
understandings pending for BentleyCapitalCorp.com to acquire any or to be
acquired by any company. BentleyCapitalCorp.com has engaged in discussions
concerning potential business combinations, but has not entered into any
agreement for such a combination.
Mr. Kirsh is the sole shareholder, officer, and director of Ucellit.com
Inc., a company with a Vitamineralherb.com license for the territory of
Ontario, Canada. Ucellit.com also plans to register its securities pursuant to
a Form SB-2 registration statement. Mr. Kirsh is also the sole shareholder,
officer and director of Gentry Resources, Inc., and Growtex Inc., both of which
filed with the Securities and Exchange Commission on March 10, 2000, Forms 10-
SB pursuant to the Securities Exchange Act of 1934.
Mr. Kirsh is also a director of Mezuma Mining, which is traded on the
Alberta Stock Exchange. Mezuma Mining has currently raised approximately
$250,000.00 Canadian and is looking for a company to acquire.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of March 28, 2000,
BentleyCapitalCorp.com's outstanding common stock owned of record or
beneficially by each Executive Officer and Director and by each person who
owned of record, or was known by BentleyCapitalCorp.com to own beneficially,
more than 5% of its common stock, and the shareholdings of all Executive
Officers and Directors as a group. Each person has sole voting and investment
power with respect to the shares shown.
<TABLE>
<CAPTION>
Shares Percentage of
Name Owned Shares Owned
---- --------- -------------
<S> <C> <C>
Michael Kirsh.................................. 1,500,000 100%
President, Secretary, Treasurer, and Director
5076 Angus Drive
Vancouver, BC Canada V6M 3M5
All Executive Officers and Directors as a Group
(1 Individual)................................ 1,500,000 100%
</TABLE>
10
<PAGE>
DESCRIPTION OF SECURITIES
The following description of BentleyCapitalCorp.com's capital stock is a
summary of the material terms of its capital stock. This summary is subject to
and qualified in its entirety by BentleyCapitalCorp.com's articles of
incorporation and bylaws, and by the applicable provisions of Washington law.
The authorized capital stock of BentleyCapitalCorp.com consists of
120,000,000 shares: 100,000,000 shares of Common Stock having a par value of
$0.0001 per share and 20,000,000 shares of Preferred Stock having a par value
of $0.0001 per share. The articles of incorporation do not permit cumulative
voting for the election of directors, and shareholders do not have any
preemptive rights to purchase shares in any future issuance of
BentleyCapitalCorp.com's common stock.
The holders of shares of common stock of BentleyCapitalCorp.com do not have
cumulative voting rights in connection with the election of the Board of
Directors, which means that the holders of more than 50% of such outstanding
shares, voting for the election of directors, can elect all of the directors to
be elected, if they so choose, and, in such event, the holders of the remaining
shares will not be able to elect any of BentleyCapitalCorp.com's directors.
The holders of shares of common stock are entitled to dividends, out of
funds legally available therefor, when and as declared by the Board of
Directors. The Board of Directors has never declared a dividend and does not
anticipate declaring a dividend in the future. Each outstanding share of common
stock entitles the holder thereof to one vote per share on all matters. The
holders of the shares of common stock have no preemptive or subscription
rights. In the event of liquidation, dissolution or winding up of the affairs
of BentleyCapitalCorp.com, holders are entitled to receive, ratably, the net
assets of BentleyCapitalCorp.com available to shareholders after payment of all
creditors.
All of the issued and outstanding shares of common stock are duly
authorized, validly issued, fully paid, and non-assessable. To the extent that
additional shares of BentleyCapitalCorp.com's common stock are issued, the
relative interests of existing shareholders may be diluted.
INTEREST OF NAMED EXPERTS AND COUNSEL
Neither Elliott Tulk Pryce Anderson nor Ogden Murphy Wallace, PLLC was
employed on a contingent basis in connection with the registration or offering
of BentleyCapitalCorp.com's common stock.
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
BentleyCapitalCorp.com's articles of incorporation provide that it will
indemnify its officers and directors to the full extent permitted by Washington
state law. BentleyCapitalCorp.com's bylaws provide that it will indemnify and
hold harmless each person who was, is or is threatened to be made a party to or
is otherwise involved in any threatened proceedings by reason of the fact that
he or she is or was a director or officer of BentleyCapitalCorp.com or is or
was serving at the request of BentleyCapitalCorp.com as a director, officer,
partner, trustee, employee, or agent of another entity, against all losses,
claims, damages, liabilities and expenses actually and reasonably incurred or
suffered in connection with such proceeding.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of
BentleyCapitalCorp.com pursuant to the forgoing provisions or otherwise,
BentleyCapitalCorp.com has been advised that, in the opinion of the Securities
and Exchange Commission, such indemnification is against public policy as
expressed in that Act and is, therefore, unenforceable.
11
<PAGE>
DESCRIPTION OF BUSINESS
General
BentleyCapitalCorp.com was incorporated under the laws of the State of
Washington on March 14, 2000, and is in its early developmental and promotional
stages. To date, BentleyCapitalCorp.com's only activities have been
organizational, directed at acquiring its principal asset, raising its initial
capital and developing its business plan. BentleyCapitalCorp.com has not
commenced commercial operations. BentleyCapitalCorp.com has no full time
employees and owns no real estate.
Acquisition of The License
On March 20, 2000, BentleyCapitalCorp.com's sole shareholder, Michael Kirsh,
in return for 1,500,000 shares of BentleyCapitalCorp.com's common stock and a
promissory note for $28,000, transferred to BentleyCapitalCorp.com his rights
under that certain License Agreement with Vitamineralherb.com. The License
Agreement grants an exclusive right to distribute Vitamineralherb.com products
to health and fitness professionals in British Columbia via the Internet. Mr.
Kirsh acquired the license under the terms of a settlement agreement by and
between Mr. Kirsh, Gentry Resources, Inc., a company in which he is the sole
shareholder, officer and director, and Mortenson & Associates, an affiliate of
Vitamineralherb.com. Mortenson & Associates had granted Gentry Resources a
license to distribute and produce an oxygen enriched water product, called
"Biocatalyst," for remediation of sewage and waste water in septic tanks and
waste water treatment facilities. Mortenson & Associates acquired its right to
sublicense Biocatalyst to Gentry Resources from NW Technologies Inc. As a
result of a legal dispute between Mortenson & Associates' principal and
NW Technologies, Mortenson & Associates was unable to fulfill its obligations
to Gentry Resources under the license. Under the terms of the settlement
agreement, Vitamineralherb.com, an affiliate of Mortenson & Associates, granted
to Kirsh the license to distribute Vitamineralherb.com products in part for his
agreement not to pursue his individual claims against Mortenson & Associates.
The License
BentleyCapitalCorp.com has a three year license to market and sell vitamins,
minerals, nutritional supplements, and other health and fitness products to
medical professionals, alternative health professionals, martial arts studios
and instructors, sports and fitness trainers, other health and fitness
professionals, school and other fund raising programs and other similar types
of customers via the Internet for sale to their clients. The license will be
automatically renewed unless BentleyCapitalCorp.com or Vitamineralherb.com
gives the other notice of its intent not to renew.
As a licensee of Vitamineralherb.com, BentleyCapitalCorp.com eliminates the
need to develop products, store inventory, build and maintain a website,
establish banking liaisons, and develop a fulfillment system, thereby enabling
BentleyCapitalCorp.com to focus strictly on marketing and sales.
BentleyCapitalCorp.com plans to target health and fitness professionals in
British Columbia who wish to offer health and fitness products to their
customers.
BentleyCapitalCorp.com (and its customers) will have access to all products
offered on the Vitamineralherb website, as well as the ability to order custom-
formulated and custom-labeled products. Vitamineralherb.com sets the price for
products based on the manufacturer's price, plus a mark up which provides a 10%
commission to Vitamineralherb.com and a profit for BentleyCapitalCorp.com.
Three different labeling options are available to customers: First, products
may be ordered with the manufacturer's standard label with no customization.
Second, the fitness or health professional may customize the labels by adding
its name, address, and phone number to the standard label. In most cases, these
labels would be a standardized label with product information and a place on
the label for the wording "Distributed by." This gives these health and fitness
professionals a competitive edge. Third, labels may be completely customized
for the health or fitness professional.
12
<PAGE>
When a fitness or health professional becomes a client,
BentleyCapitalCorp.com's salesperson will show the client how to access the
Vitamineralherb website. The client is assigned an identification number that
identifies it by territory, salesperson, and business name, address, and other
pertinent information. The health or fitness professional may then order the
products it desires directly through the Vitamineralherb.com website, paying
for the purchase with a credit card, electronic check ("e-check"), or debit
card. All products are shipped by the manufacturer directly to the professional
or its clients.
The website is maintained by Vitamineralherb.com, and each licensee pays an
annual website maintenance fee of $500. All financial transactions are handled
by Vitamineralherb.com's Internet clearing bank. The Vitamineralherb webmaster
downloads e-mail orders several times a day, checks with clearing bank for
payment and then submits the product order and electronic payment to
International Formulation and Manufacturing. Vitamineralherb.com then forwards
the money due BentleyCapitalCorp.com via electronic funds transfer.
Vitamineralherb's software tracks all sales through the customer's
identification number, and at month end, e-mails to BentleyCapitalCorp.com and
customer a detailed report including sales commissions. Vitamineralherb has
indicated that it will use e-commerce advertising such as banner ads on major
servers and websites, as well as trying to insure that all major search engines
pick Vitamineralherb.com first. Sales originating from the website to customers
located in British Columbia will automatically be assigned to
BentleyCapitalCorp.com.
Background on the Manufacturer and Distributor
On June 9, 1999, Vitamineralherb.com entered into a manufacturing agreement
with International Formulation and Manufacturing Inc. a nutraceuticals
manufacturing firm, located in San Diego, California, USA. International
Formulation and Manufacturing has been a contract manufacturer of vitamin,
mineral, nutritional supplement, and alternative health products for various
marketing organizations for approximately six years; International Formulation
and Manufacturing does no retail marketing. In addition to a line of standard
products, International Formulation and Manufacturing is able to manufacture
custom blended products for customers. International Formulation and
Manufacturing also has the capability to supply privately labeled products for
BentleyCapitalCorp.com's customers at a minimal added cost. Vitamineralherb.com
has just begun developing its vitamin marketing and distributorship business.
Implementation of Business Plan: Milestones
BentleyCapitalCorp.com's business plan is to determine the feasibility of
selling Vitamineralherb.com products to targeted markets. Should
BentleyCapitalCorp.com determine that its business plan is feasible, it intends
to employ salespeople to call on medical professionals, alternative health
professionals, martial arts studios and instructors, sports and fitness
trainers, other health and fitness professionals, school and other fund raising
programs and other similar types of customers to interest these professionals
in selling to their clients high-quality, low-cost vitamins, minerals,
nutritional supplements, and other health and fitness products. These
professionals would sell the products to their clients via the Internet.
In order to determine the feasibility of its business plan,
BentleyCapitalCorp.com may, during the next six to twelve months, conduct
research into the various potential target markets. Should
BentleyCapitalCorp.com determine that the exploitation of the license is
feasible, it will engage salespeople to market the products. The expenses of
market research and obtaining salespeople will likely exceed the funds raised
by this offering, and BentleyCapitalCorp.com will have to obtain additional
financing through an offering or through capital contributions by current
shareholders. No commitments to provide additional funds have been made by
management or shareholders. Accordingly, there can be no assurance that any
additional funds will be available on terms acceptable to
BentleyCapitalCorp.com or at all. BentleyCapitalCorp.com expects to begin
earning revenues shortly after a sales force is in place.
13
<PAGE>
Industry Background
Growth of the Internet and electronic commerce. The Internet has become an
increasingly significant medium for communication, information and commerce.
According to NUA Internet Surveys, as of February 2000, there were
approximately 275.5 million Internet users worldwide. At the IDC Internet
Executive Forum held on September 28-29, 1999, IDC stated that in 1999 US $109
billion in purchases were impacted by the Internet. IDC's vice president, Sean
Kaldor, indicated that figure is expected to increase more than ten-fold over
the next five years to US $1.3 trillion in 2003, with $842 million completed
directly over the Web. BentleyCapitalCorp.com believes that this dramatic
growth presents significant opportunities for online retailers.
The vitamin, supplement, mineral and alternative health product market. In
recent years, a growing awareness of vitamins, herbs, and other dietary
supplements by the general public has created a whole new segment in the field
of medicine and health care products. According to Jupiter Communications,
online sales of such products are expected to be US $434 million in the year
2003, up from $1 million in 1998. BentleyCapitalCorp.com believes that several
factors are driving this growth, including a rapidly growing segment of the
population that is concerned with aging and disease, a growing interest in
preventative health care, favorable consumer attitudes toward alternative
health products and a favorable regulatory statute, the Dietary Supplement
Health and Education Act of 1994.
Competition
The electronic commerce industry is new, rapidly evolving and intensely
competitive, and BentleyCapitalCorp.com expects competition to intensify in
the future. Barriers to entry are minimal and current and new competitors can
launch sites at a relatively low cost. In addition, the vitamin, supplement,
mineral and alternative health product market is very competitive and highly
fragmented, with no clear dominant leader and increasing public and commercial
attention.
BentleyCapitalCorp.com's competitors can be divided into several groups
including:
. traditional vitamins, supplements, minerals and alternative health
products retailers;
. the online retail initiatives of several traditional vitamins,
supplements, minerals and alternative health products retailers;
. online retailers of pharmaceutical and other health-related products
that also carry vitamins, supplements, minerals and alternative health
products;
. independent online retailers specializing in vitamins, supplements,
minerals and alternative health products;
. mail-order and catalog retailers of vitamins, supplements, minerals and
alternative health products, some of which have already developed online
retail outlets; and
. direct sales organizations, retail drugstore chains, health food store
merchants, mass market retail chains and various manufacturers of
alternative health products.
Many of BentleyCapitalCorp.com's potential competitors have longer
operating histories, larger customer or user bases, greater brand recognition
and significantly greater financial, marketing and other resources than
BentleyCapitalCorp.com has. In addition, an online retailer may be acquired
by, receive investments from, or enter into other commercial relationships
with, larger, well-established and well-financed companies as use of the
Internet and other electronic services increases. Competitors have and may
continue to adopt aggressive pricing or inventory availability policies and
devote substantially more resources to website and systems development than
BentleyCapitalCorp.com does. Increased competition may result in reduced
operating margins and loss of market share.
14
<PAGE>
BentleyCapitalCorp.com believes that the principal competitive factors in
its market are:
. ability to attract and retain customers;
. breadth of product selection;
. product pricing;
. ability to customize products and labeling;
. quality and responsiveness of customer service.
BentleyCapitalCorp.com believes that it can compete favorably on these
factors. However, BentleyCapitalCorp.com will have no control over how
successful its competitors are in addressing these factors. In addition, with
little difficulty, BentleyCapitalCorp.com's online competitors can duplicate
many of the products or services offered on the Vitamineralherb.com site.
BentleyCapitalCorp.com believes that traditional retailers of vitamins,
supplements, minerals and other alternative health products face several
challenges in succeeding:
. Lack of convenience and personalized service. Traditional retailers have
limited store hours and locations. Traditional retailers are also unable
to provide consumers with product advice tailored to their particular
situation.
. Limited product assortment. The capital and real estate intensive nature
of store-based retailers limit the product selection that can be
economically offered in each store location.
. Lack of Customer Loyalty. Although the larger traditional retailers
often attract customers, many of these customers are only one-time
users. People are often attractive to the name brands, but find the
products too expensive. It is understood that these are quality products
and have value, but the multilevel structure of marketing often employed
by large retailers mandate high prices.
As a result of the foregoing limitations, BentleyCapitalCorp.com believes
there is significant unmet demand for an alternative shopping channel that can
provide consumers of vitamins, supplements, minerals and other alternative
health products with a broad array of products and a convenient and private
shopping experience.
BentleyCapitalCorp.com hopes to attract and retain consumers through the
following key attributes of its business:
. Broad Expandable Product Assortment. BentleyCapitalCorp.com's product
selection is substantially larger than that offered by store-based
retailers.
. Low Product Prices. Product prices can be kept low due to volume
purchases through BentleyCapitalCorp.com's affiliation with
Vitamineralherb.com and other licensees. Product prices will also be
lower due to BentleyCapitalCorp.com's lack of need of inventory and
warehouse space. All products are shipped from International Formulation
and Manufacturing's inventory.
. Accessibility to Customized Products. At minimal cost, health and
fitness practitioners may offer their customers customized products.
. Access to Personalized Programs. Health or fitness professional can
tailor vitamin and dietary supplement regimes to their clients.
Regulatory Environment
The manufacturing, processing, formulating, packaging, labeling and
advertising of the products BentleyCapitalCorp.com sells in Canada are or may
be subject to regulation by Health Canada which administers the Food and Drugs
Act along with relevant regulation thereto. Regulated products include herbal
15
<PAGE>
remedies, natural health remedies, functional foods and nutraceuticals. Health
Canada regulates the formulation, manufacture, labeling and distribution of
foods, including dietary supplements, cosmetics and over-the-counter or
homeopathic drugs. Under the Food and Drugs Act, a variety of enforcement
actions are available to Health Canada against marketers of unapproved drugs or
"adulterated" or "misbranded" products. The remedies available to Health Canada
include: criminal prosecution; an injunction to stop the sale of a company's
products; seizure of products; adverse publicity; and "voluntary" recalls and
labeling changes.
The Consumer Packaging and Labeling Act, as administered by Industry Canada,
requires that certain information labeling be presented in a prescribed manner
on all foods, drugs, dietary supplements and cosmetics. A product may be deemed
an unapproved drug and "misbranded" if it bears improper claims or improper
labeling.
The manufacturing, processing, formulating, packaging, labeling and
advertising of the products BentleyCapitalCorp.com sells may also be subject to
regulation by one or more U.S. federal agencies, including the Food and Drug
Administration, the Federal Trade Commission, the United States Department of
Agriculture and the Environmental Protection Agency. These activities also may
be regulated by various agencies of the states, localities and foreign
countries in which consumers reside.
The Food and Drug Administration, in particular, regulates the formulation,
manufacture, labeling and distribution of foods, including dietary supplements,
cosmetics and over-the- counter or homeopathic drugs. Under the Federal Food,
Drug, and Cosmetic Act, the Food and Drug Administration may undertake
enforcement actions against companies marketing unapproved drugs, or
"adulterated" or "misbranded" products. The remedies available to the Food and
Drug Administration include: criminal prosecution; an injunction to stop the
sale of a company's products; seizure of products; adverse publicity; and
"voluntary" recalls and labeling changes.
Food and Drug Administration regulations require that certain informational
labeling be presented in a prescribed manner on all foods, drugs, dietary
supplements and cosmetics. Specifically, the Food, Drug, and Cosmetic Act
requires that food, including dietary supplements, drugs and cosmetics, not be
"misbranded." A product may be deemed an unapproved drug and "misbranded" if it
bears improper claims or improper labeling. The Food and Drug Administration
has indicated that promotional statements made about dietary supplements on a
company's website may constitute "labeling" for purposes of compliance with the
provisions of the Food, Drug, and Cosmetic Act. A manufacturer or distributor
of dietary supplements must notify the Food and Drug Administration when it
markets a product with labeling claims that the product has an effect on the
structure or function of the body. Noncompliance with the Food, Drug, and
Cosmetic Act, and recently enacted amendments to that Act discussed below,
could result in enforcement action by the Food and Drug Administration.
The Food, Drug, and Cosmetic Act has been amended several times with respect
to dietary supplements, most recently by the Nutrition Labeling and Education
Act of 1990 and the Dietary Supplement Health and Education Act of 1994. The
Dietary Supplement Health and Education Act created a new statutory framework
governing the definition, regulation and labeling of dietary supplements. With
respect to definition, the Dietary Supplement Health and Education Act created
a new class of dietary supplements, consisting of vitamins, minerals, herbs,
amino acids and other dietary substances for human use to supplement the diet,
as well as concentrates, metabolites, extracts or combinations of such dietary
ingredients. Generally, under the Dietary Supplement Health and Education Act,
dietary ingredients that were on the market before October 15, 1994 may be sold
without Food and Drug Administration pre-approval and without notifying the
Food and Drug Administration. In contrast, a new dietary ingredient, i.e., one
not on the market before October 15, 1994, requires proof that it has been used
as an article of food without being chemically altered or evidence of a history
of use or other evidence of safety establishing that it is reasonably expected
to be safe. Retailers, in addition to dietary supplement manufacturers, are
responsible for ensuring that the products they market for sale comply with
these regulations. Noncompliance could result in enforcement action by the Food
and Drug Administration, an injunction prohibiting the sale of products deemed
to be noncompliant, the seizure of such products and criminal prosecution.
16
<PAGE>
The Food and Drug Administration has indicated that claims or statements
made on a company's website about dietary supplements may constitute "labeling"
and thus be subject to regulation by the Food and Drug Administration. With
respect to labeling, the Dietary Supplement Health and Education Act amends,
for dietary supplements, the Nutrition Labeling and Education Act by providing
that "statements of nutritional support," also referred to as
"structure/function claims," may be used in dietary supplement labeling without
Food and Drug Administration pre-approval, provided certain requirements are
met. These statements may describe how particular dietary ingredients affect
the structure or function of the body, or the mechanism of action by which a
dietary ingredient may affect body structure or function, but may not state a
drug claim, i.e., a claim that a dietary supplement will diagnose, mitigate,
treat, cure or prevent a disease. A company making a "statement of nutritional
support" must possess substantiating evidence for the statement, disclose on
the label that the Food and Drug Administration has not reviewed the statement
and that the product is not intended for use for a disease and notify the Food
and Drug Administration of the statement within 30 days after its initial use.
It is possible that the statements presented in connection with product
descriptions on BentleyCapitalCorp.com's site may be determined by the Food and
Drug Administration to be drug claims rather than acceptable statements of
nutritional support. In addition, some of BentleyCapitalCorp.com's suppliers
may incorporate objectionable statements directly in their product names or on
their products' labels, or otherwise fail to comply with applicable
manufacturing, labeling and registration requirements for over-the-counter or
homeopathic drugs or dietary supplements. As a result, Vitamineralherb.com may
have to remove objectionable statements or products from its site or modify
these statements, or product names or labels, in order to comply with Food and
Drug Administration regulations. Such changes could interfere with
BentleyCapitalCorp.com's marketing of products and could cause us to incur
significant additional expenses.
In addition, the Dietary Supplement Health and Education Act allows the
dissemination of "third party literature" in connection with the sale of
dietary supplements to consumers at retail if the publication meets statutory
requirements. Under the Dietary Supplement Health and Education Act, "third
party literature" may be distributed if, among other things, it is not false or
misleading, no particular manufacturer or brand of dietary supplement is
promoted, a balanced view of available scientific information on the subject
matter is presented and there is physical separation from dietary supplements
in stores. The extent to which this provision may be used by online retailers
is not yet clear, and BentleyCapitalCorp.com cannot assure you that all pieces
of "third party literature" that may be disseminated in connection with the
products BentleyCapitalCorp.com offers for sale will be determined to be lawful
by the Food and Drug Administration. Any such failure could render the involved
product an unapproved drug or a "misbranded" product, potentially subjecting us
to enforcement action by the Food and Drug Administration, and could require
the removal of the noncompliant literature from Vitamineralherb.com's website
or the modification of BentleyCapitalCorp.com's selling methods, interfering
with BentleyCapitalCorp.com's continued marketing of that product and causing
us to incur significant additional expenses. Given the fact that the Dietary
Supplement Health and Education Act was enacted only five years ago, the Food
and Drug Administration's regulatory policy and enforcement positions on
certain aspects of the new law are still evolving. Moreover, ongoing and future
litigation between dietary supplement companies and the Food and Drug
Administration will likely further refine the legal interpretations of the
Dietary Supplement Health and Education Act. As a result, the regulatory status
of certain types of dietary supplement products, as well as the nature and
extent of permissible claims will remain unclear for the foreseeable future.
Two areas in particular that pose potential regulatory risk are the limits on
claims implying some benefit or relationship with a disease or related
condition and the application of the physical separation requirement for "third
party literature" as applied to Internet sales.
In addition to the regulatory scheme under the Food, Drug and Cosmetic Act,
the advertising and promotion of dietary supplements, foods, over-the-counter
drugs and cosmetics is subject to scrutiny by the Federal Trade Commission. The
Federal Trade Commission Act prohibits "unfair or deceptive" advertising or
marketing practices, and the Federal Trade Commission has pursued numerous food
and dietary supplement manufacturers and retailers for deceptive advertising or
failure to substantiate promotional claims, including, in many instances,
claims made via the Internet. The Federal Trade Commission has the power to
seek administrative or judicial relief prohibiting a wide variety of claims, to
enjoin future advertising, to seek redress or restitution payments and to seek
a consent order and seek monetary penalties for the violation of a consent
17
<PAGE>
order. In general, existing laws and regulations apply fully to transactions
and other activity on the Internet. The Federal Trade Commission is in the
process of reviewing its policies regarding the applicability of its rules and
its consumer protection guides to the Internet and other electronic media. The
Federal Trade Commission has already undertaken a new monitoring and
enforcement initiative, "Operation Cure-All," targeting allegedly bogus health
claims for products and treatments offered for sale on the Internet. Many
states impose their own labeling or safety requirements that differ from or add
to existing federal requirements.
BentleyCapitalCorp.com cannot predict the nature of any future Canadian or
U.S. laws, regulations, interpretations or applications, nor can it determine
what effect additional governmental regulations or administrative orders, when
and if promulgated, would have on its business in the future. Although the
regulation of dietary supplements is less restrictive than that of drugs and
food additives, BentleyCapitalCorp.com cannot assure you that the current
statutory scheme and regulations applicable to dietary supplements will remain
less restrictive. Further, BentleyCapitalCorp.com cannot assure you that, under
existing laws and regulations, or if more stringent statutes are enacted,
regulations are promulgated or enforcement policies are adopted, it is or will
be in compliance with these existing or new statutes, regulations or
enforcement policies without incurring material expenses or adjusting its
business strategy. Any laws, regulations, enforcement policies, interpretations
or applications applicable to BentleyCapitalCorp.com's business could require
the reformulation of certain products to meet new standards, the recall or
discontinuance of certain products not capable of reformulation, additional
record keeping, expanded documentation of the properties of certain products,
expanded or different labeling or scientific substantiation.
Regulation of the Internet. In general, existing laws and regulations apply
to transactions and other activity on the Internet; however, the precise
applicability of these laws and regulations to the Internet is sometimes
uncertain. The vast majority of such laws were adopted prior to the advent of
the Internet and, as a result, do not contemplate or address the unique issues
of the Internet or electronic commerce. Nevertheless, numerous federal and
state government agencies have already demonstrated significant activity in
promoting consumer protection and enforcing other regulatory and disclosure
statutes on the Internet. Additionally, due to the increasing use of the
Internet as a medium for commerce and communication, it is possible that new
laws and regulations may be enacted with respect to the Internet and electronic
commerce covering issues such as user privacy, freedom of expression,
advertising, pricing, content and quality of products and services, taxation,
intellectual property rights and information security. The adoption of such
laws or regulations and the applicability of existing laws and regulations to
the Internet may impair the growth of Internet use and result in a decline in
BentleyCapitalCorp.com's sales.
A number of legislative proposals have been made at the federal, state and
local level, and by foreign governments, that would impose additional taxes on
the sale of goods and services over the Internet, and certain states have taken
measures to tax Internet-related activities. Although Congress recently placed
a three-year moratorium on new state and local taxes on Internet access or on
discriminatory taxes on electronic commerce, existing state or local laws were
expressly excepted from this moratorium. Further, once this moratorium is
lifted, some type of federal and/or state taxes may be imposed upon Internet
commerce. Such legislation or other attempts at regulating commerce over the
Internet may substantially impair the growth of commerce on the Internet and,
as a result, adversely affect BentleyCapitalCorp.com's opportunity to derive
financial benefit from such activities.
Employees
BentleyCapitalCorp.com is a development stage company and currently has no
employees. BentleyCapitalCorp.com is currently managed by Michael Kirsh, its
sole officer and director. BentleyCapitalCorp.com looks to Mr. Kirsh for his
entrepreneurial skills and talents. For a complete discussion of Mr. Kirsh's
experience, please see "Directors and Executive Officers." Management plans to
use consultants, attorneys and accountants as necessary and does not plan to
engage any full-time employees in the near future. BentleyCapitalCorp.com may
hire marketing employees based on the projected size of the market and the
compensation necessary to retain qualified sales employees. A portion of any
employee compensation
18
<PAGE>
likely would include the right to acquire stock in BentleyCapitalCorp.com,
which would dilute the ownership interest of holders of existing shares of its
common stock.
Available Information and Reports to Securities Holders
BentleyCapitalCorp.com has filed with the Securities and Exchange Commission
a registration statement on Form SB-2 with respect to the common stock offered
by this prospectus. This prospectus, which constitutes a part of the
registration statement, does not contain all of the information set forth in
the registration statement or the exhibits and schedules which are part of the
registration statement. For further information with respect to
BentleyCapitalCorp.com and its common stock, see the registration statement and
the exhibits and schedules thereto. Any document BentleyCapitalCorp.com files
may be read and copied at the Commission's Public Reference Room located at 450
Fifth Street N.W., Washington D.C. 20549, and the public reference rooms in New
York, New York, and Chicago, Illinois. Please call the Commission at 1-800-SEC-
0330 for further information about the public reference rooms.
BentleyCapitalCorp.com's filings with the Commission are also available to the
public from the Commission's website at http://www.sec.gov.
Upon completion of this offering, BentleyCapitalCorp.com will become subject
to the information and periodic reporting requirements of the Securities
Exchange Act and, accordingly, will file periodic reports, proxy statements and
other information with the Commission. Such periodic reports, proxy statements
and other information will be available for inspection and copying at the
Commission's public reference rooms, and the website of the Commission referred
to above.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion and analysis of BentleyCapitalCorp.com's financial
condition and results of operations should be read in conjunction with the
Financial Statements and accompanying notes and the other financial information
appearing elsewhere in this Prospectus.
This prospectus contains forward-looking statements, the accuracy of which
involve risks and uncertainties. Words such as "anticipates," "believes,"
"plans," "expects," "future," "intends" and similar expressions are used to
identify forward-looking statements. This prospectus also contains forward-
looking statements attributed to certain third parties relating to their
estimates regarding the potential markets for Vitamineralherb products.
Prospective investors should not place undue reliance on these forward-looking
statements, which apply only as of the date of this prospectus.
BentleyCapitalCorp.com's actual results could differ materially from those
anticipated in these forward-looking statements for many reasons, including the
risks faced by BentleyCapitalCorp.com described in "Risk Factors" and elsewhere
in this prospectus. The following discussion and analysis should be read in
conjunction with BentleyCapitalCorp.com's Financial Statements and Notes
thereto and other financial information included elsewhere in this prospectus.
Results of Operations
During the period from March 14, 2000 through March 31, 2000,
BentleyCapitalCorp.com has engaged in no significant operations other than
organizational activities, acquisition of the rights to market Vitamineralherb
and preparation for registration of its securities under the Securities Act of
1933, as amended. No revenues were received by BentleyCapitalCorp.com during
this period.
For the current fiscal year, BentleyCapitalCorp.com anticipates incurring a
loss as a result of organizational expenses, expenses associated with
registration under the Securities Act of 1933, and expenses associated with
setting up a company structure to begin implementing its business plan.
BentleyCapitalCorp.com anticipates that until these procedures are completed,
it will not generate revenues, and may continue to operate at a loss
thereafter, depending upon the performance of the business.
BentleyCapitalCorp.com's business plan is to determine the feasibility of
marketing the Vitamineralherb products in various markets, and, if the products
prove to be in demand, begin marketing and selling Vitamineralherb products.
19
<PAGE>
Liquidity and Capital Resources
BentleyCapitalCorp.com remains in the development stage and, since
inception, has experienced no significant change in liquidity or capital
resources or shareholders' equity. Consequently, BentleyCapitalCorp.com's
balance sheet as of March 31, 2000, reflects total assets of $35,000, in the
form of a license and capitalized organizational costs. Organizational expenses
of $8,000 were paid for by the sole shareholder and expensed to operations.
BentleyCapitalCorp.com's business plan is to determine the feasibility of
selling Vitamineralherb.com products to targeted markets. Should
BentleyCapitalCorp.com determine that its business plan is feasible, it intends
to employ salespeople to call on medical professionals, alternative health
professionals, martial arts studios and instructors, sports and fitness
trainers, other health and fitness professionals, school and other fund raising
programs and other similar types of customers to interest these professionals
in selling to their clients high-quality, low-cost vitamins, minerals,
nutritional supplements, and other health and fitness products. These
professionals would sell the products to their clients via the Internet.
In order to determine the feasibility of its business plan,
BentleyCapitalCorp.com plans, during the next six to twelve months, to conduct
research into these various potential target markets. Should
BentleyCapitalCorp.com determine that the exploitation of the license is
feasible, it will engage salespeople to market the products. Based primarily on
discussions with the licensor, BentleyCapitalCorp.com believes that during its
first operational quarter, it will need a capital infusion of approximately
$90,000 to achieve a sustainable sales level where ongoing operations can be
funded out of revenues. This capital infusion is intended to cover costs of
advertising, hiring and paying two salespeople, and administrative expenses. In
addition, BentleyCapitalCorp.com will need approximately $260,000 in the event
it determines that its market will not pay in advance and it will have to
extend credit. These expenses will exceed the funds raised by this offering,
and BentleyCapitalCorp.com will have to obtain additional financing through an
offering or capital contributions by current shareholders.
BentleyCapitalCorp.com is conducting this offering, in part, because it
believes that an early registration of its equity securities will minimize some
of the impediments to capital formation that otherwise exist. By having a
registration statement in place, BentleyCapitalCorp.com believes it will be in
a better position, either to conduct a future public offering of its securities
or to undertake a private placement with registration rights, than if it were a
completely private company. Registering its shares will help minimize the
liquidity discounts BentleyCapitalCorp.com may otherwise have to take in a
future private placement of its equity securities, because investors will have
a high degree of confidence that the Rule 144(c)(1) public information
requirement will be satisfied, and a public market will exist to effect Rule
144(g) broker transactions. BentleyCapitalCorp.com believes that the cost of
registering its securities, and undertaking the affirmative disclosure
obligations that such a registration entails, will be more than offset by
avoiding deep liquidity discounts in future sales of securities. No specific
private investors have been identified, but BentleyCapitalCorp.com's management
has general knowledge of an investor class interested in investing in companies
that can demonstrate a clear path to an early liquidity event.
No commitments to provide additional funds have been made by management or
shareholders. Accordingly, there can be no assurance that any additional funds
will be available on terms acceptable to BentleyCapitalCorp.com or at all.
BentleyCapitalCorp.com expects to begin earning revenues shortly after a sales
force is in place.
In addition, BentleyCapitalCorp.com may engage in a combination with another
business. BentleyCapitalCorp.com cannot predict the extent to which its
liquidity and capital resources will be diminished prior to the consummation of
a business combination or whether its capital will be further depleted by the
operating losses (if any) of the business entity with which
BentleyCapitalCorp.com may eventually combine. BentleyCapitalCorp.com has
engaged in discussions concerning potential business combinations, but has not
entered into any agreement for such a combination.
20
<PAGE>
BentleyCapitalCorp.com will need additional capital to carry out its
business plan or to engage in a business combination. No commitments to provide
additional funds have been made by management or other shareholders.
Accordingly, there can be no assurance that any additional funds will be
available on terms acceptable to BentleyCapitalCorp.com or at all.
BentleyCapitalCorp.com has no commitments for capital expenditures.
DESCRIPTION OF PROPERTY
BentleyCapitalCorp.com currently maintains limited office space, occupied by
Michael Kirsh, for which it pays no rent. Its address is 1177 West Hastings,
Suite 2110, Vancouver, British Columbia V6E 2K3, Canada and its phone number is
(604) 687-2199. BentleyCapitalCorp.com does not believe that it will need to
obtain additional office space at any time in the foreseeable future until its
business plan is more fully implemented.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
No director, executive officer or nominee for election as a director of
BentleyCapitalCorp.com, and no owner of five percent or more of
BentleyCapitalCorp.com's outstanding shares or any member of their immediate
family has entered into or proposed any transaction in which the amount
involved exceeds $60,000.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
No established public trading market exists for BentleyCapitalCorp.com's
securities. BentleyCapitalCorp.com has no common equity subject to outstanding
purchase options or warrants. BentleyCapitalCorp.com has no securities
convertible into its common equity. There is no common equity that could be
sold pursuant to Rule 144 under the Securities Act or that
BentleyCapitalCorp.com has agreed to register under the Securities Act for sale
by shareholders. Except for this offering, there is no common equity that is
being, or has been publicly proposed to be, publicly offered by
BentleyCapitalCorp.com.
As of March 31, 2000, there were 1,500,000 shares of common stock
outstanding, held by 1 shareholder of record. Upon effectiveness of the
registration statement that includes this prospectus, all of
BentleyCapitalCorp.com's outstanding shares will be eligible for sale.
To date BentleyCapitalCorp.com has not paid any dividends on its common
stock and does not expect to declare or pay any dividends on its common stock
in the foreseeable future. Payment of any dividends will depend upon
BentleyCapitalCorp.com's future earnings, if any, its financial condition, and
other factors as deemed relevant by the Board of Directors.
EXECUTIVE COMPENSATION
No officer or director has received any remuneration from
BentleyCapitalCorp.com. Although there is no current plan in existence, it is
possible that BentleyCapitalCorp.com will adopt a plan to pay or accrue
compensation to its officers and directors for services related to the
implementation of BentleyCapitalCorp.com's business plan.
BentleyCapitalCorp.com has no stock option, retirement, incentive, defined
benefit, actuarial, pension or profit-sharing programs for the benefit of
directors, officers or other employees, but the Board of Directors may
recommend adoption of one or more such programs in the future.
BentleyCapitalCorp.com has no employment contract or compensatory plan or
arrangement with any executive officer of BentleyCapitalCorp.com. The director
currently does not receive any cash compensation from BentleyCapitalCorp.com
for his service as a member of the board of directors. There is no compensation
committee, and no compensation policies have been adopted. See "Certain
Relationships and Related Transactions."
21
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Independent Auditor's Report............................................ F-1
Balance Sheet........................................................... F-2
Statement of Operations................................................. F-3
Statement of Cash Flows................................................. F-4
Statement of Stockholders' Equity....................................... F-5
Notes to the Financial Statements....................................... F-6
</TABLE>
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors
Bentleycapitalcorp.com Inc.
(A Development Stage Company)
We have audited the accompanying balance sheet of Bentleycapitalcorp.com
Inc. (A Development Stage Company) as of March 31, 2000 and the related
statements of operations, stockholders' equity and cash flows for the period
from March 14, 2000 (Date of Inception) to March 31, 2000. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with U.S. generally accepted auditing
standards. Those standards require that we 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. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the aforementioned financial statements present fairly, in
all material respects, the financial position of Bentleycapitalcorp.com Inc. (A
Development Stage Company), as of March 31, 2000, and the results of its
operations and its cash flows for the period from March 14, 2000 (Date of
Inception) to March 31, 2000, in conformity with U.S. generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has not generated any revenues or conducted
any operations since inception. These factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans in regard
to these matters are also discussed in Note 1. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
/s/ Elliott Tulk Pryce Anderson
CHARTERED ACCOUNTANTS
Vancouver, Canada
March 31, 2000
F-1
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
BALANCE SHEET
(expressed in U.S. dollars)
<TABLE>
<CAPTION>
March 31,
2000
$
---------
ASSETS
------
<S> <C>
License (Notes 3 and 4).......................................... 24,750
=======
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
<S> <C>
Current Liabilities
Note payable (Note 4).......................................... 28,000
-------
Stockholders' Equity
Common Stock, 100,000,000 common shares authorized with a par
value of $.0001; 20,000,000 preferred shares with a par value
of $.0001; 1,500,000 common shares issued and outstanding..... 150
Additional Paid in Capital..................................... 14,850
Preferred Stock, 20,000,000 preferred shares authorized with a
par value of $.0001; none issued.............................. --
Deficit Accumulated During the Development Stage............... (18,250)
-------
(3,250)
-------
24,750
=======
Contingent Liability (Note 1)
Commitment (Note 3)
</TABLE>
(The accompanying notes are an integral part of the financial statements)
F-2
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS
(expressed in U.S. dollars)
<TABLE>
<CAPTION>
From March 14, 2000
(Date of Inception)
to March 31, 2000
-------------------
<S> <C>
Revenue................................................ $ --
-------
Expenses
Legal................................................ 8,000
-------
Net Loss............................................... $(8,000)
=======
</TABLE>
(The accompanying notes are an integral part of the financial statements)
F-3
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
(expressed in U.S. dollars)
<TABLE>
<CAPTION>
From March 14, 2000
(Date of Inception)
to March 31, 2000
$
-------------------
<S> <C>
Cash Flows to Operating Activities:
Net loss................................................. (8,000)
Non-cash item............................................
Note payable........................................... 8,000
-------
Net Cash Used by Operating Activities...................... --
-------
Change in cash............................................. --
Cash--beginning of period.................................. --
-------
Cash--end of period........................................ --
=======
Non-Cash Financing Activities:
A total of 1,500,000 shares were issued to a director at
a fair market value of $0.01 per share for the
acquisition of a License (Notes 3)...................... 15,000
Less dividend deemed paid (Note 4)....................... (10,250)
A note payable was issued to a director for the
acquisition of a License (Notes 3 and 4)................ 20,000
-------
24,750
=======
Supplemental Disclosures
Interest paid............................................ --
Income tax paid.......................................... --
</TABLE>
(The accompanying notes are an integral part of the financial statements)
F-4
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
From March 14, 2000 (Date of Inception) to March 31, 2000
(expressed in U.S. dollars)
<TABLE>
<CAPTION>
Deficit
Accumulated
Common Stock Additional During the
---------------- Paid-in Development
Shares Amount Capital Total Stage
# $ $ $ $
--------- ------ ---------- ------ -----------
<S> <C> <C> <C> <C> <C>
Balance--March 14, 2000
(Date of Inception)........ -- -- -- -- --
Stock issued for a license
at a fair market value of
$0.01 share.............. 1,500,000 150 14,850 15,000 --
Dividend deemed paid
(Note 4)................. -- -- -- -- (10,250)
Net loss for the period... -- -- -- -- (8,000)
--------- --- ------ ------ -------
Balance--March 31, 2000..... 1,500,000 150 14,850 15,000 (18,250)
========= === ====== ====== =======
</TABLE>
(The accompanying notes are an integral part of the financial statements)
F-5
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS
(expressed in U.S. dollars)
1. DEVELOPMENT STAGE COMPANY
Bentleycapitalcorp.com Inc. herein (the "Company") was incorporated in the
State of Washington, U.S.A. on March 14, 2000. The Company acquired a license
to market and distribute vitamins, minerals, nutritional supplements, and other
health and fitness products in the Province of British Columbia, Canada. The
grantor of the license offers these products for sale from various suppliers on
their Web Site.
The Company is in the development stage.
In a development stage company, management devotes most of its activities in
developing a market for its products. Planned principal activities have not yet
begun. The ability of the Company to emerge from the development stage with
respect to any planned principal business activity is dependent upon its
successful efforts to raise additional equity financing and/or attain
profitable operations. There is no guarantee that the Company will be able to
raise any equity financing or sell any of its products at a profit. There is
substantial doubt regarding the Company's ability to continue as a going
concern.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Year end
The Company's fiscal year end is December 31.
(b) License
The cost to acquire a license is capitalized as incurred. These costs
will be amortized on a straight-line basis over the next twelve months,
commencing April 1, 2000.
(c) Cash and Cash Equivalents
The Company considers all highly liquid instruments with a maturity of
three months or less at the time of issuance to be cash equivalents.
(d) Revenue Recognition
The Company recognizes revenue on a net profit basis after the grantor
of its license receives 50% of the profits. Revenue will be recorded when
the grantor of the license has received cleared funds, made and paid for
the order with the supplies of the product, and net profit is determined by
the grantor.
(e) Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the periods. Actual results could differ from those estimates.
3. LICENSE
The Company's only asset is a license to market vitamins, minerals,
nutritional supplements and other health and fitness products in the Province
of British Columbia, Canada, through the Grantor's Web Site. The Company
desires to market these products to medical practitioners, alternative health
professionals, martial arts
F-6
<PAGE>
BENTLEYCAPITALCORP.COM INC.
(A Development Stage Company)
NOTES TO THE FINANCIAL STATEMENTS--(Continued)
(expressed in U.S. dollars)
studios and instructors, sports and fitness trainers, other health and fitness
practitioners, school and other fund raising programs and other similar types
of customers. The license was acquired on March 20, 2000 for a term of three
years. The Company must pay an annual fee of $500 for maintenance of the
Grantor's Web Site commencing on the anniversary date. The Grantor of the
license retains 50% of the profits.
See Note 5 for consideration paid to a related party for the assignment of
this license.
4. RELATED PARTY TRANSACTION
The License referred to in Note 3 was assigned to the Company by the sole
director and President of the Company for consideration of 1,500,000 shares
having a fair market value of $15,000 and a note payable of $20,000. The
Company has estimated the cost of the license to its President at $24,750. The
estimate is based on an allocation of the President's cash outlay of $33,000
for common stock of Gentry Resources, Inc., by virtue of which the President
obtained the license as well as his continued ownership of Gentry Resources.
The fair market value of $35,000, based on recent comparable transactions, was
allocated to note payable as to $20,000, par value as to $150 and additional
paid in capital of $14,850. The excess of fair market value over predecessor
cost, being $10,250 is treated as a dividend which increased the deficit. The
Grantor of the License is not related to the Company.
The President of the Company also paid for organizational expenses and
offering costs in the amount of $8,000 which was added to the $20,000 note
payable. The note payable is unsecured, non-interest bearing and has no
specific terms of repayment.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
F-7
<PAGE>
PART II--INFORMATION NOT REQUIRED IN PROSPECTUS
INDEMNIFICATION OF DIRECTORS AND OFFICERS
BentleyCapitalCorp.com's Articles of Incorporation provide that it must
indemnify its directors and officers to the fullest extent permitted under
Washington law against all liabilities incurred by reason of the fact that the
person is or was a director or officer of BentleyCapitalCorp.com or a fiduciary
of an employee benefit plan, or is or was serving at the request of
BentleyCapitalCorp.com as a director or officer, or fiduciary of an employee
benefit plan, of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise.
The effect of these provisions is potentially to indemnify
BentleyCapitalCorp.com's directors and officers from all costs and expenses of
liability incurred by them in connection with any action, suit or proceeding in
which they are involved by reason of their affiliation with
BentleyCapitalCorp.com. Pursuant to Washington law, a corporation may indemnify
a director, provided that such indemnity shall not apply on account of:
(a) acts or omissions of the director finally adjudged to be intentional
misconduct or a knowing violation of law; (b) unlawful distributions; or (c)
any transaction with respect to which it was finally adjudged that such
director personally received a benefit in money, property, or services to which
the director was not legally entitled.
The bylaws of BentleyCapitalCorp.com, filed as Exhibit 3.2, provide that it
will indemnify its officers and directors for costs and expenses incurred in
connection with the defense of actions, suits, or proceedings against them on
account of their being or having been directors or officers of
BentleyCapitalCorp.com, absent a finding of negligence or misconduct in office.
BentleyCapitalCorp.com's Bylaws also permit it to maintain insurance on behalf
of its officers, directors, employees and agents against any liability asserted
against and incurred by that person whether or not BentleyCapitalCorp.com has
the power to indemnify such person against liability for any of those acts.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The securities are being registered for the account of selling shareholders,
and all of the following expenses will be borne by such shareholders. The
amounts set forth are estimates except for the SEC registration fee:
<TABLE>
<CAPTION>
Amount to
be Paid
---------
<S> <C>
SEC registration fee........................................... $ 35
Printing and engraving expenses................................ --
Attorneys' fees and expenses................................... 8,000
Accountants' fees and expenses................................. 1,500
Transfer agent's and registrar's fees and expenses............. 500
Miscellaneous.................................................. 965
-------
Total.......................................................... $11,000
=======
</TABLE>
The Registrant will bear all expenses shown above.
RECENT SALES OF UNREGISTERED SECURITIES
Set forth below is information regarding the issuance and sales of
BentleyCapitalCorp.com's securities without registration since its formation.
No such sales involved the use of an underwriter and no commissions were paid
in connection with the sale of any securities.
On March 20, 2000, BentleyCapitalCorp.com issued 1,500,000 shares of common
stock to Michael Kirsh in compensation, along with a promissory note for
$28,000, for the license of Vitamineralherb.com rights. The
II-1
<PAGE>
issuance of the shares was exempt from registration under Rule 506 of
Regulation D, and sections 3(b) and 4(2) of the Securities Act of 1933, as
amended, due to Mr. Kirsh's status as the founder and initial management of
BentleyCapitalCorp.com, and his status as an accredited investor, and the
limited number of investors (one).
EXHIBITS
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
3.1* Articles of Incorporation
3.2* Bylaws
4.1* Specimen Stock Certificate
4.2* Stock Subscription Agreement
5.1 Opinion re: legality
10.1* License Agreement
10.2* Assignment of License Agreement
10.3* Promissory Note
23.1 Consent of Independent Auditors
23.2 Consent of Counsel (see Exhibit 5.1)
27.1 Financial Data Schedule
</TABLE>
--------
* Previously filed
UNDERTAKINGS
The Registrant hereby undertakes that it will:
(1) File, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to:
(i) Include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information in the registration statement; and
(iii) Include any additional or changed material information on the
plan of distribution.
(2) For determining liability under the Securities Act, treat each post-
effective amendment as a new registration statement of the securities
offered, and the Offering of the securities of the securities at that time
to be the initial bona fide Offering.
(3) File a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of the Offering.
(4) Provide to the Underwriters at the closing specified in the
underwriting agreement certificates in such denominations and registered in
such names as required by the Underwriters to permit prompt delivery to
each purchaser.
(5) For determining any liability under the Securities Act, treat the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act as part of this registration statement as
of the time the Commission declared it effective.
(6) For determining any liability under the Securities Act, treat each
post-effective amendment that contains a form of prospectus as a new
registration statement for the securities offered in the registration
statement, and the offering of the securities at that time as the initial
bona fide Offering of those securities.
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<PAGE>
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
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 Registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant 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 Registrant 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.
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<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form SB-2 and authorized this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Vancouver, British Columbia, Canada, on May 31,
2000.
BentleyCapitalCorp.com Inc.
/s/ Michael Kirsh
By: _________________________________
Michael Kirsh
President
In accordance with the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates stated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Michael Kirsh President, Secretary, May 31, 2000
______________________________________ Treasurer, and Director
Michael Kirsh
</TABLE>
II-4
<PAGE>
LIST OF EXHIBITS
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
3.1* Articles of Incorporation
3.2* Bylaws
4.1* Specimen Stock Certificate
4.2* Stock Subscription Agreement
5.1 Opinion re: legality
10.1* License Agreement
10.2* Assignment of License Agreement
10.3* Promissory Note
23.1 Consent of Independent Auditors
23.2 Consent of Counsel (see Exhibit 5.1)
27.1 Financial Data Schedule
</TABLE>
--------
* Previously filed
