U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-SB12G
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL
BUSINESS ISSUERS
UNDER SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
BIDDER COMMUNICATIONS, INC.
(Name of Small Business Issuer in its charter)
Nevada 88-0471842
(State of incorporation) (I.R.S. Employer Identification No.)
418-119 W. Pender St., Vancouver, B.C., Canada V6B 1S5
(Address of principal executive offices) (Zip Code)
Issuer's Telephone Number: (604) 408-7441
Securities to be registered pursuant to 12(b) of the Act: NONE
Securities to be registered pursuant to 12(g) of the Act:
COMMON STOCK $.001 PAR VALUE
(Title of Class)
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PART I
ITEM 1. DESCRIPTION OF BUSINESS
General
-------
Bidder Communications, Inc. ("Registrant") was incorporated in the State
of Nevada on November 16, 1999 to engage in the business of operating an
online person-to-person auction site. Registrant raised a total of
$65,000 in a public offering pursuant to an exemption provided by Rule
504 of Regulation D, promulgated under the Securities Act of 1933, as
amended.
Registrant has developed its websites, Net-Bidder.com as a web-based
community in which buyers and sellers are brought together in an
efficient and entertaining auction format to buy and sell items such as
antiques, coins, collectibles, computers, memorabilia, stamps, toys and
miscellaneous equipment. The website services will permit sellers to list
items for sale, buyers to bid on items of interest and all Net Bidder users
to browse through listed items. This 24-hour-a-day, seven-day-a-week service
will be fully automated, topically arranged, intuitive and easy to use.
The website services provide a platform for businesses to showcase their
products in an efficient and entertaining auction format. Within this Web-
based community, vendors can reach their clients 24 hours a day, 7 days a
week in a fully automated, easy to use systm.
Registrant is also currently developing its Game-Bidder.com website.
Game-bidder provides a unique platform in the gaming community for players
and owners of video games to buy and sell previously played games and systems.
Game-bidder also supports the selling of new games and systems in a special
retailer section. Auctions for accessories and miscellaneous gaming items can
also be listed for bid. Media content, in the form of gaming reviews, gaming
links and gaming discussions have or will be included. Registrant has
developed an enjoyable, entertaining and visual auction format for users to
trade in.
Browsers and buyers can search auction listings for specific items or
search by category, key word, seller name, recently commenced auctions
or auctions about to end. This auction format creates a sense of urgency
among buyers to bid for goods and creates an entertaining and compelling
trading environment.
Revenues
--------
Registrant's primary revenues will be derived from commission on transactions
between users who are buying and selling items on the auction sites.
Specifically, items listed for bid are charged a standard fee. A fee
schedule has also been developed for sellers who wish to enhance their
auction listing through special features, such as front-page listing or
image uploads alongside the listing. In addition, Registrant expects to
gain revenue through third party banner advertising and fees regarding
access to user base information. Contingent upon demand, fees may also be
extracted from retail operations wishing to post their items for auction or
direct sale on the Game-Bidder or Net-Bidder platforms. In addition, revenues
will be derived from developing auction sites for other businesses or
organizations. The commissions, banners, and retail fees are directly
associated with Registrant's websites and potentially any sites in which
Registrant develops an auction for and retains ownership or marketing rights to.
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Business Objectives
-------------------
Registrant's key objective is to position Net-Bidder.com and Game-Bidder.com
as leading online person-to-person trading communities. Key elements of this
strategy include the following:
* growing the Net Bidder and Game Bidder communities and strengthening the
brand names to attract new users and maintain vitality on the websites;
* promoting new product categories and offering services for specific
regions;
* fostering Net Bidder and Game Bidder community affinity and increasing
trust and safety;
* enhancing website features and functionality through the introduction
of personalization features and the opportunity to showcase items
graphically;
* expanding pre- and post-trade value-added services, such as third-
party escrow services and arrangements to make shipping of purchased
items easier; and
* developing international markets by actively marketing and promoting
the websites in selected countries.
Target Markets
--------------
Registrant intends to position Net-Bidder.com and Game-Bidder.com to
target web-savvy consumers with a mature outlook on online trading and
e-commerce execution. Although the overall target market is the general
consumer, there are pockets of users with higher interest or comfort in using
online auction services. Initial advertising or promotions will be
specifically placed to maximize exposure to these markets. For example,
there may be web advertising on portal web sites that claim high
consumer activity in e-commerce transactions. In addition, banner ads
and links will be placed on existing retail e-commerce sites, in which
there is both high traffic and sizable retail activity. The primary
focus will be to generate high click-through rates to the web sites and
to facilitate application to the user base. In addition, key
word search insertions and listings will be made on the popular search
engine web sites. Registrant has registered its websites with AllBusiness.
com and Clickhouse.com, both Internet search directory services.
Since each consumer may require different levels of assistance
in navigating and operating the tools of the auction sites, special attention
will be made on covering a variety of e-commerce needs. This includes, but is
not limited to: privacy and general security on the auction site, retail
marketing concepts and strategies, secure transactions and digital
authentication, e-cash and web credit concepts. The required complexity will
be dependent on the size of the transaction, the volume of transactions and
the method of payment.
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Initially, Net-Bidder.com and Game Bidder.com are targeting consumers in the
North American market in order to gauge advertising success in a defined area.
Registrant will seek to ensure success of its websites by providing personal,
user-friendly and accessible services to build up clientele, name brand
exposure, recognition and reputation. Once established, advertising and
promotion could be expanded globally, as there are no limits or
boundaries in the Internet e-commerce markets. Country-specific or
language-specific websites, with related Net Bidder URLs will be
established when resources become available. Registrant has secured and
reserved domain names targeted for future international use.
In June, 2000, Net-Bidder.com completed its first test auction of used oil
equipment in conjunction with Corlac, Inc., an unrelated third party
with contacts in the used oil equipment industry in Alberta, Canada.
Traffic analysis of the auction indicated that a significant percentage
of visitors registered and placed bids, but marketing was lacking, resulting
in minimum sales. A new marketing strategy will be implemented prior to
Registrant's next test auction.
Industry Overview
-----------------
The Internet provides the opportunity to develop one-to-one
relationships with customers worldwide from a central location without
having to make the significant investments required to build a number of
local retail presences or develop the printing and mailing
infrastructure associated with traditional direct marketing activities.
While companies have generally focused on applying these benefits in
business-to-business and business-to-consumer transactions, Registrant
believes a significant market opportunity exists to apply these same
advantages to facilitate person-to-person trading over the Internet.
The exchange of goods among individuals and small dealers--person-to-
person trading--traditionally has been conducted through trading forums
such as classified advertisements, collectibles shows, garage sales and
flea markets or through intermediaries, such as auction houses. These
markets are highly inefficient for the following reasons:
* their regional nature makes it difficult and expensive for buyers and
sellers to exchange information and transact business;
* they offer a limited variety and breadth of goods;
* they often have high transaction costs from intermediaries; and
* buyers and sellers lack a reliable and convenient means of setting
prices for sales or purchases.
Despite these inefficiencies, the market for traditional person-to-
person trading in the U.S. continues to expand. The Internet offers for
the first time the opportunity to create a compelling global marketplace
that overcomes the inefficiencies associated with traditional person-to-
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person trading, while offering the benefits of Internet-based commerce.
An Internet-based centralized trading place offers the following
benefits:
- facilitates buyers and sellers meeting, listing items for sale,
exchanging information and participating in transactions;
- allows buyers and sellers to trade directly, bypassing traditional
intermediaries, lowering costs for both;
- is global in reach, offering buyers a significantly broader selection
of goods and providing sellers the opportunity to sell their goods to a
broader base of buyers; and
- offers significant convenience, allowing trading at any hour of the
day or night and provides continually updated information.
In addition, community orientation, facilitation of direct buyer and
seller communication, and efficient access to information on a party's
trading history can help alleviate the risks of anonymous trading. As a
result, Registrant believes there exists a significant opportunity for
Internet-based centralized trading that applies the unique attributes of
the Internet to facilitate person-to-person trading.
E-commerce Markets
------------------
The market for the sale of goods over the Internet, particularly through
person-to-person trading, is a new and emerging market. Registrant's
potential future revenues and/or will be substantially dependent upon
the widespread acceptance of the Internet and online services as a
medium for commerce by consumers. This acceptance and use may not
continue. Even if the Internet is accepted, concerns about fraud,
privacy and other problems may mean the Internet will not
be broadly adopted as a consumer medium of commerce. Market acceptance
for recently introduced services over the Internet is highly uncertain,
and there are few proven products.
There are also many risks associated with future potential international
operations. Expansion into international markets will require management
attention and resources. It will require experience in localizing the
Net Bidder services to conform to local cultures, standards and
policies. Competition may come from local international companies who
understand the local markets better. As Registrant expands its
operations internationally, it will be subject to risks of doing
business internationally, including the following:
* regulatory requirements that may limit or prevent the offering of our
services in local jurisdictions;
* government-imposed limitations on the public's access to the Internet;
* political instability; and
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* potentially adverse tax consequences and administrative burdens in
handling them.
International operations may have portions of international revenues
denominated in foreign currencies, thereby becoming subject to
collection difficulties and risks relating to foreign currency exchange
rate fluctuations.
Industry success will depend on development and maintenance of the Web
infrastructure, including maintenance of a reliable network backbone
with the necessary speed, data capacity and security, as well as timely
development of complementary products such as high speed modems, for
providing reliable Web access and services. Because global commerce and
the online exchange of information is new and evolving, one cannot
predict whether the Web will prove to be a viable commercial marketplace
in the long term. The Web has experienced, and is likely to continue to
experience, significant growth in the numbers of users and amount of
traffic. If the Web continues to experience increased numbers of users,
increased frequency of use or increased bandwidth requirements, the Web
infrastructure may be unable to support the demands placed on it. In
addition, the performance of the Web may be harmed by increased users or
bandwidth requirements.
A significant barrier to online commerce and communications is the
secure transmission of confidential information over public networks.
Security measures may not prevent security breaches. Failure to prevent
security breaches could harm Registrant's business opportunities and
damage its brand name. Currently, a significant number of users
authorize billing their credit card accounts directly for all
transaction fees. There is a reliance on encryption and authentication
technology licensed from third parties to provide secure transmission of
confidential information, including customer credit card numbers.
Advances in computer capabilities, new discoveries in the field of
cryptography, or other developments may result in a compromise or breach
of the technology used to protect customer transaction data.
Competition
-----------
The market for person-to-person trading over the Internet is new,
rapidly evolving and intensely competitive. Barriers to entry are
relatively low and new sites can be launched at a relatively low cost
using commercially available software. Direct competitors include
various online person-to-person auction services, including Yahoo!
Auctions Powered by Onsale, and Excite, Inc., both of which are free to
sellers and buyers. Auction Universe, eBay, Amazon and a number of small
services, including those that serve specialty or regional markets such
as CityAuction are also operational. Business-to-consumer online auction
services are Onsale, First Auction, Surplus Auction and uBid.
Traditional auction companies, including Butterfield & Butterfield are
offering or have announced plans to create Internet auction sites. The
Company potentially faces competition from a number of large online
communities and services that have expertise in developing online
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commerce and in facilitating online person-to-person interaction
including AOL, Amazon, Lycos, Inc. and Microsoft Corporation, currently
offer business-to-consumer trading services and classified ad services.
Some of these companies also may introduce person-to-person trading to
their large user populations. Other large companies with strong brand
recognition and experience in online commerce, such as Cendant
Corporation, QVC, USA Network and large newspaper or media companies,
also may seek to compete in the online auction market.
The principal competitive factors include the following:
* volume of transactions and selection of goods;
* community cohesion and interaction;
* system reliability;
* customer service;
* reliability of delivery and payment by users;
* brand recognition;
* website convenience and accessibility;
* level of service fees; and
* quality of search tools.
Some current and many potential competitors have longer company
operating histories, larger customer bases and greater brand recognition
in other business and Internet markets. Some competitors also have
significantly greater financial, marketing, technical and other
resources. Other online trading services may be acquired by, receive
investments from or enter into other commercial relationships with
larger, well established and well financed companies. Competitors with
other revenue sources may be able to devote more resources to marketing
and promotional campaigns, adopt more aggressive pricing policies and
devote substantially more resources to website and systems development.
Increased competition could result in reduced operating margins, loss of
market share and diminished brand value.
In order to respond to changes in the competitive environment, pricing,
service or marketing decisions or acquisitions may be necessary, such as
a free insurance program that generally insures items up to a specific
value for users with a non-negative feedback rating. New technologies
may increase competitive pressures by enabling its competitors to offer
a low cost service. Some web-based applications that direct Internet
traffic to certain websites may channel users to competing
trading/auction services.
Proprietary Data
----------------
Registrant has registered the domain name Net-Bidder.com and has
reserved other domain names for future international expansion of its
website. Registrant is currently developing and expanding the design of
its website.
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Marketing and Advertising
-------------------------
To attract users to its websites, Registrant will rely primarily on word
of mouth and on distribution or sponsorship relationships with high
traffic websites. Registrant will also engage in a number of marketing
activities in traditional media such as advertising in print media,
trade shows and other events. Registrant also intends to advertise in a
number of targeted publications. Registrant intends to launch a
substantial national advertising campaign, both in traditional media and
online, that is designed to attract new Net Bidder and Game Bidder users.
This campaign will include print, a major radio advertising campaign, strategic
advertising and sponsorship placements on high traffic websites and
advertising in other media. Registrant will promote public relations
through initiatives such as online Net Bidder/Game Bidder special event
tie-ins and executive speaking engagements.
Promoting and positioning the "Net Bidder" and "Game Bidder" brand names
will depend largely on the success of marketing efforts and the ability to
provide high quality services. Brand promotion activities may not immediately
yield increased revenues, and, any increased revenues may not offset
expenses incurred.
Substantially all revenues will be from fees received from sellers for
listing products for sale on Registrant's websites and fees received from
successfully completed sales. Future revenues will depend upon
continued demand for the types of goods that are listed by users. A
decline in the popularity of, or demand for, certain collectibles, games or
other items sold on the website could reduce the overall volume of
transactions, resulting in reduced revenues. In addition, consumer
"fads" may temporarily inflate the volume of certain types of items
listed placing a significant strain upon infrastructure and transaction
capacity.
Registrant intends to implement the following programs to enhance use of
its online auction services:
* User Trust Programs
A feedback forum designed to encourage users to provide comments and
feedback on other users with whom they interact, thereby offering user
profiles that will provide feedback ratings and comments to Registrant
and its users. Guidelines for trading will be established, providing
information to resolve user disputes, responding to reports of misuse of
the service and, if necessary, warning or suspending users who violate
the terms of the agreement. Trust and safety initiatives may include
user verifications, insurance, integrated escrow, authentications and/or
appraisals.
* Cost-Effective, Convenient Trading
Bypassing traditionally expensive, regionally fragmented intermediaries
can be accomplished by transacting business on a 24-hour-a-day, seven-
day-a-week basis. By carrying no inventory, sellers bypass costly
traditional intermediaries, thus allowing for lower selling costs and
increasing the sellers' likelihood of finding buyers willing to pay his
or her target price. To list an item, sellers pay only a nominal
placement fee and then pay an additional success fee that is a
percentage of the transaction value only if an auction is concluded with
a successful bid. As a result, sellers for the first time can sell
relatively inexpensive items, which had previously been prohibitively
expensive to list through most traditional trading forums.
* Enhance Features and Functionality
Registrant intends to update and enhance the features and functionality
of Net Bidder frequently in order to continue to improve the user's
trading experience. Personalization features, showcasing items in a visual
format, category-specific content, regional searches and other features will
be designed to enhance the Net Bidder and Game Bidder experiences.
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Customer Support
----------------
Registrant will devote significant resources to providing personalized,
timely customer service and support. Customer support inquiries will be
handled via email, with customer email inquiries typically being
answered within 24 hours after submission. Registrant offers an online
tutorial for new Net Bidder and Game Bidder users. Registrant's websites will
employ robust, scaleable user interface and transaction processing system.
The Net Bidder and Game Bidder systems will handle all aspects of the auction
process, including notifying users via email when they initially register for
the service, have successfully bid, have been outbid, or when an auction ends
for an item placed on sale. The system will maintain user registration
information, billing accounts, current auctions and historical listings.
Sellers may place a credit card account number on file with Net Bidder or
game Bidder and their account balance will be billed directly.
Office Facilities
-----------------
Registrant's executive offices are located at 418-119 W. Pender Street,
Vancouver, B.C., Canada, which it leases on a monthly basis, at
competitive market rates. Registrant's computer server equipment is
located at the facilities of Bitmovers Communications, Inc., an
unrelated third party, located at 402-329 Railway Street, Vancouver,
B.C., Canada. Bitmovers provides network connectivity, bandwidth and
power facility for web servers and networking equipment owned by
Registrant. Terms of the verbal agreement provide for Registrant to pay
Bitmovers network rack space at the rate of $500 US per month, on a
month-to-month basis.
Employees
---------
At the present time, Registrant has no employees, other than its
officers and directors, who are not paid for their services.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan of Operation
-----------------
Registrant expects its current cash in the bank, in addition to the
revenues it expects to derive from sales of its products and services to
satisfy its cash requirements for business operations for at least the
next 12 months without having to raise additional funds or seek bank
loans.
For the period from inception to Registrant's year end on December 31,
1999, Registrant had not yet generated any revenues or expended any
significant amount of money for research and development. During the
next 12 months, Registrant intends to spend approximately $50,000 on
advertising, marketing and promotion of its products and services.
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During the next 12 months, Registrant does not intend to purchase any
significant property or equipment.
Results of Operations
---------------------
For the period from inception to December 31, 1999, Registrant had no
revenues. For the nine months ended September 30, 2000, Registrant
generated revenues of $2,223 from operations and $1,209 in interest
income. For the period from inception to December 31, 1999, Registrant
had not yet expended any significant amount of money for research and
development; however, for the nine months ended September 30, 2000,
Registrant expended a total of approximately $13,142 on research and
development of its websites and services, all of which was paid to
unrelated third parties.
During the fiscal year ended December 31, 1999 and for the nine month period
ended September 30, 2000, Registrant incurred net operating losses of $909
U.S. and $22,908 U.S., respectively, all of which comprised general and
administrative expenses.
Net cash provided by financing activities was $52,000 for the fiscal year
ended December 31, 1999 and $65,000 for the nine months ended
September 30, 2000. The ability of Registrant to continue as a going
concern is dependent on its ability to generate revenues or raise funds
through sale of its equity securities for use in administrative and
investment activities.
ITEM 3. DESCRIPTION OF PROPERTY
Registrant does not currently own any property other than its
proprietary software and domain names.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
Registrant's Common Stock beneficially owned on December 31, 1999, and
at September 30, 2000, for (i) each shareholder known by Registrant to
be the beneficial owner of five (5%) percent or more of Registrant's
outstanding Common Stock, (ii) each of Registrant's executive officers
and directors, and (iii) all executive officers and directors as a group.
At December 31, 1999, there were 7,000,000 shares of Registrant's Common
Stock issued and outstanding and at September 30, 2000, there were 8,300,000
shares of Common Stock issued and outstanding.
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<TABLE>
<CAPTION>
<S> <C> <C>
Name and Address Amount and Nature of
of Beneficial Beneficial Percent of
Owner (1) Ownership (2) Class
---------------- --------------------- ---------
Jon H. Suk (3) 1,000,000 12%
121-12931 Railway Avenue
Richmond, BC Canada V7E 6M5
James Y. S. Suk (3) 1,000,000 12%
#804-819 Hamilton Street
Vancouver, BC Canada V6B 6M2
Tony Brisbois(4) 2,500,000 30%
243 West Broadway
Vancouver, British Columbia
Canada V5Y 1P5
Robert Evans(4) 2,500,000 30%
4062 Cambie Street
Vancouver, British Columbia
Canada V5Z 2X8
-------------------------------
All Executive Officers and
Directors as a group (2 persons) 7,000,000 84%
</TABLE>
(1) The persons named above, who are the only officers, directors
and principal shareholders of Registrant, may be deemed to be "parents"
and "promoters" of Registrant, within the meaning of such terms under
the Securities Act of 1933, by virtue of their direct holdings in
Registrant. These persons are the only "promoters" of the Company.
(2) In general, a person is considered a "beneficial owner" of a
security if that person has or shares the power to vote or direct the
voting of such security, or the power to dispose of such security. A
person is also considered to be a beneficial owner of any securities of
which the person has the right to acquire beneficial ownership within
(60) days.
(3) Jon Suk and James Suk are brothers, both of whom are officers and
directors of Registrant.
(4) Tony Brisbois and Robert Evans are unrelated third parties.
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ITEM 5. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND SIGNIFICANT
EMPLOYEES
The following table sets forth the names, positions with Registrant and
ages of the executive officers and directors of Registrant. Directors
are elected at Registrant's annual meeting of shareholders and serve for one
year or until their successors are elected and qualify. Officers are
elected by the Board and their terms of office are, except to the extent
governed by employment contract, at the discretion of the Board.
<TABLE>
<CAPTION>
<S> <C> <C>
Name Age Position(s)
---- --- -----------
Jon H. Suk 34 President and Director
121-12931 Railway Avenue
Richmond, BC Canada V7E 6M5
James Y. S. Suk 29 Secretary, Treasurer and
#804-819 Hamilton Street Director
Vancouver, BC Canada V6B 6M2
</TABLE>
Background of Officers and Directors
------------------------------------
Jon H. Suk has been President and a Director of the Company since
inception. Since May 1993, he has also been the co-owner of Image
Factory, Inc., a computer graphics and systems consulting business in
Vancouver, Canada. From March 1999 to July 2000, he was an officer,
director and principal shareholder of Interface E.com, Inc., a
publicly-traded Nevada corporation engaged in the business of Internet
E-commerce consulting. Mr. Suk is the brother of James Y.S. Suk. Mr. Suk
devotes his time as required to the business of Registrant.
James Y. S. Suk has been the Secretary, Treasurer and a Director of the
Company since inception. Since March 2000, he has also been Marketing Manager
for Altus Solutions, Inc., a privately-held corporation in Canada, which
provides software that proactively manages traffic on networks. Since May 1993,
he has also been the co-owner of Image Factory, Inc., a computer graphics and
systems consulting business in Vancouver, Canada. From March 1999 to July 2000,
he was an officer, director and principal shareholder of Interface E.com,
Inc., a publicly-traded Nevada corporation engaged in the business of
Internet E-commerce consulting. He attended the University of British
Columbia in Vancouver and received a Bachelor of Commerce degree, with
a specialization in Finance in 1993. Mr. Suk is the brother of Jon H.
Suk, an officer, director and principal shareholder of Registrant. Mr.
Suk devotes his time as needed to the business of Image Factory, Altus
Solutions, Inc. and Registrant.
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ITEM 6. EXECUTIVE COMPENSATION
Registrant's officers and directors do not presently receive a salary
for their services and there are currently no plans to implement any
such compensation. They are, however, reimbursed for any out-of-pocket
expenses incurred on behalf of Registrant.
Employment Agreements
---------------------
Registrant's officers and directors are not currently party to any
employment agreements with Registrant. Registrant presently has no
pension, health, annuity, insurance, stock options, profit sharing or
similar benefit plans; however, Registrant may adopt such plans in the
future. There are presently no personal benefits available to directors,
officers or employees of Registrant.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The officers and directors of Registrant are involved in other business
activities, and may, in the future become active in additional other business
activities. If a specific business opportunity becomes available, such persons
may face a conflict in selecting between Registrant and their own business
interests. Registrant has not formulated a policy for the resolution of such
conflicts.
The President and Secretary of Registrant are brothers.
On December 1, 1999, a total of 2,000,000 shares of restricted Common Stock
were issued to Jon Suk and James Suk, Registrant's officers and directors in
exchange for organizational services and expenses, proprietary rights, business
plans and cash in the amount of $2,000 U.S., or $.001 per share.
ITEM 8. DESCRIPTION OF SECURITIES
At December 31, 1999, there were 7,000,000 shares of Registrant's common
stock issued and outstanding and at September 30, 2000, there were a
total of 8,300,000 shares of Common Stock issued and outstanding.
Common Stock
------------
The authorized capital stock of the Company consists of 100,000,000
shares of Common Stock, par value $.001 per share. The holders of Common
Stock (i) have equal ratable rights to dividends from funds legally available
therefor, when, as and if declared by the Board of Directors of
Registrant; (ii) are entitled to share ratably in all of the assets of
Registrant available for distribution to holders of Common Stock upon
liquidation, dissolution or winding up of the affairs of Registrant;
(iii) do not have preemptive, subscription or conversion rights and there
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are no redemption or sinking fund provisions or rights applicable thereto;
and (iv) are entitled to one non-cumulative vote per share on all matters on
which stockholders may vote. All shares of Common Stock now outstanding
are fully paid for and non-assessable. Reference is made to Registrant's
Articles of Incorporation, By-Laws and the applicable statutes of the
State of Nevada for a more complete description of the rights and
liabilities of holders of Registrant's securities.
Non-cumulative Voting
---------------------
The holders of shares of Common Stock of Registrant do not have
cumulative voting rights, which means that the holders of more than 50%
of such outstanding shares, voting for the election of directors, can
elect all of the directors to be elected, if they so choose, and, in
such event, the holders of the remaining shares will not be able to
elect any of Registrant's directors.
Cash Dividends
--------------
As of the date of this registration statement, Registrant has not paid
any cash dividends to stockholders. The declaration of any future cash
dividend will be at the discretion of the Board of Directors and will
depend upon the earnings, if any, capital requirements and financial
position of the Company, general economic conditions, and other
pertinent conditions. It is the present intention of Registrant not to
pay any cash dividends in the foreseeable future, but rather to reinvest
earnings, if any, in Registrant's business.
Reports
-------
Registrant will furnish audited annual financial reports to
stockholders, certified by its independent accountants, and will furnish
unaudited quarterly financial reports, reviewed by its independent
accountants.
Stock Transfer Agent
--------------------
Registrant's stock transfer agent is Signature Stock Transfer of Dallas,
Texas.
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY
AND OTHER STOCKHOLDER MATTERS
At December 31, 1999, there were 4 shareholders of record and at
September 30, 2000, there were 32 shareholders of record of Registrant's
Common Stock. Registrant's Common Stock is currently listed for trading
in the "pink Sheets" under the trading symbol, "BIDC"; however, no
trading has yet commenced.
14
<PAGE>
ITEM 2. LEGAL PROCEEDINGS
Management of Registrant believes there are no material legal
proceedings filed, or to Registrant's knowledge, threatened against
Registrant.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
Parker & Co., independent chartered accountants, have been Registrant's
only auditors since inception and there have been no disagreements
between Registrant and Parker & Co.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES
On December 1, 1999, a total of 2,000,000 shares of restricted Common
Stock were issued to Registrant's officers and directors in exchange for
organizational services and expenses, proprietary rights, business plans
and cash in the amount of $2,000 U.S., or $.001 per share.
On December 12, 1999, a total of 5,000,000 shares of restricted Common
Stock were issued in exchange for $50,000 U.S., or $.01 per share. All
of such shares were sold to unrelated third parties.
On July 31, 2000, Registrant issued 1,300,000 shares of Common Stock, at
a price of $.05 per share to 28 investors pursuant to an offering under
Rule 504 of Regulation D, promulgated under the Securities Act of 1933,
approved by the State of Nevada Securities Division and raised a total
of $65,000 to be used for general operations of Registrant.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Pursuant to the Articles of Incorporation and By-Laws of the
corporation, Registrant may indemnify an officer or director who is made
a party to any proceeding, including a law suit, because of her
position, if she acted in good faith and in a manner she reasonably
believed to be in the best interest of Registrant. In certain cases may
advance expenses incurred in defending any such proceeding. To the
extent that the officer or director is successful on the merits in any
such proceeding as to which such person is to be indemnified, Registrant
must indemnify her against all expenses incurred, including attorney's
fees. With respect to a derivative action, indemnity may be made only
for expenses actually and reasonably incurred in defending the
proceeding, and if the officer or director is judged liable, only by a
court order. The indemnification is intended to be to the fullest extent
permitted by the laws of the State of Nevada. Insofar as indemnification for
liabilities arising under the Securities Act of 1933, as amended, may be
permitted to directors or officers pursuant to the foregoing provisions,
Registrant is informed that, in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy, as expressed in
said Act and is, therefore, unenforceable.
15
<PAGE>
PART F/S
The financial statements and supplementary data are included herein.
FINANCIAL STATEMENTS AND EXHIBITS
Following are the audited Financial Statements of Registrant for the
period from inception to December 31, 1999 and for the nine months ended
September 30, 2000, prepared by Parker & Co., Chartered Accountants.
16
<PAGE>
BIDDER COMMUNICATIONS, INC.
INTERIM FINANCIAL STATEMENTS
For the Nine Months Ended 30 September 2000 and for the
period from Inception, 16 November 1999 to December 31, 1999
17
<PAGE>
PARKER & COMPANY Page 1 of 8
CHARTERED ACCOUNTANTS
200-2560 Simpson Road
Richmond, B.C. Canada V6X 2P9
Tel: (604) 276-9920
Fax: (604) 276-4577
INDEPENDENT AUDITORS' REPORT
To the Stockholders of Bidder Communications, Inc.
We have audited the interim statement of financial position of Bidder
Communications Inc. as at 30 September 2000 and as at 31 December 1999
and the interim statements of loss and deficit, of cash flows and of changes
in stockholder's equity for the period for the nine months ended 30 September
2000 and for the period from inception, 16 November 1999 to 31 December 1999.
These interim financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these interim
financial statements based on our audit.
We conducted our audits in accordance with generally accepted auditing
standards in Canada, which are in substantial agreement with those in the
United States. Those standards require that we plan and perform an audit to
obtain reasonable assurances whether the interim 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 made by management,
as well as evaluating the overall financial statement presentation.
In our opinion, these interim financial statements present fairly, in
all material respects, the financial position of the Company as at 30
September 2000 and December 31, 1999, and the results of its operations, cash
flows and changes in stockholder's equity for the nine months ended 30
September 2000 and for the period from its inception, 16 November 1999 to 31
December 1999 in accordance with generally accepted accounting principles in
the United States.
These financial statements have been prepared assuming the Company will
continue as a going concern. As stated in Note 2 to the interim financial
statements, the Company has no established will require an infusion of
capital to sustain itself. This requirement for additional capital raises
substantial doubt about the Company's ability to continue as a going concern.
The interim financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
Parker & Company
CHARTERED ACCOUNTANTS
Richmond, British Columbia
26 November 2000
18
<PAGE>
<TABLE> Page 2 of 8
<CAPTION>
BIDDER COMMUNICATIONS, INC.
Interim Statement of Financial Position
Audited - See Independent Auditors' Report
As at As at
30 September 2000 31 December 1999
----------------- ----------------
<S> <C> <C>
CURRENT ASSETS
Cash $ 65,445 $ 51,986
Goods and services taxes - 28
recoverable
Deposit on rent 4,253 -
-------- --------
Total current assets 69,698 52,014
-------- --------
Capital assets (note 3)
Furniture, equipment and
Software, at cost 28,174 -
Accumulated amortization 3,889 -
------- --------
Unamortized capital asset
Costs 24,285 -
------- --------
TOTAL ASSETS $ 93,983 $ 52,014
======== ========
CURRENT LIABILITIES
Accounts payable $ 800 $ 428
Due to a shareholder - 495
-------- --------
Total current liabilities 800 923
-------- --------
STOCKHOLDERS' EQUITY
Share Capital (Note 4) 8,300 7,000
Additional paid-in capital 108,700 45,000
------- --------
Total share capital 117,000 52,000
Deficit (23,817) (909)
------- --------
Total stockholders' equity 93,183 51,091
------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $93,983 $ 52,014
======= ========
</TABLE>
19
<PAGE>
<TABLE> Page 3 of 8
<CAPTION>
BIDDER COMMUNICATIONS, INC.
Interim Statement of Loss and Deficit
Audited - See Independent Auditors' Report
From the date of
For the nine Incorporation,
months ended 16 November 1999
30 September 2000 to 31 December 1999
----------------- -------------------
<S> <C> <C>
REVENUE
Sales $ 2,223 $ 0
Interest earned 1,209 4
--------- -------
Total revenue 3,432 4
--------- -------
EXPENSES
Auto, parking 29 -
Commissions 1,414 -
Consulting 13,142 425
Courier 80 -
Accounting 1,635 400
Legal 1,087 -
Transfer agent 500 -
Bank charges and interest 258 18
Registration and filing fees 545 70
Meals and entertainment 435 -
Travel 666 -
Rent 1,431 -
Office supplies 317 -
Telephone and internet communications 912 -
Amortization of capital asset costs 3,889 -
--------- -------
Total expenses 26,340 913
LOSSES BEFORE INCOME TAXES (22,908) (909)
INCOME TAXES, NOTE 5 - -
--------- -------
NET LOSS (22,908) (909)
DEFICIT, BEGINNING (909) -
--------- -------
DEFICIT, ENDING $(23,817) $ (909)
LOSS PER SHARE, NOTE 6 $ (0.00) $ (0.00)
</TABLE>
20
<PAGE>
<TABLE> Page 4 of 8
<CAPTION>
BIDDER COMMUNICATIONS, INC.
Interim Statement of Loss and Deficit
Audited - See Independent Auditors' Report
From the date of
For the nine Incorporation,
months ended 16 November 1999
30 September 2000 to 31 December 1999
----------------- -------------------
<S> <C> <C>
CASH PROVIDED (USED)FROM OPERATIONS:
From Operation
Net loss $(22,908) $ (909)
Non cash items included therein 3,889 -
-------- --------
Cash used for loss (19,019) (909)
-------- --------
Changes in working capital other
than cash
Goods and services sales taxes
Recoverable 28 (28)
Deposit on rent (4,253) -
Accounts payable 372 428
Due to a shareholder (495) 495
-------- --------
Cash provided (used) for
Working capital (4,348) 895
-------- --------
Total cash provided (used)
from operations (23,367) (14)
-------- --------
CASH PROVIDED BY INVESTMENT ACTIVITY:
Acquisition of capital assets (28,174) -
-------- --------
Total cash provided (used by
investment activities (28,174) -
-------- --------
CASH PROVIDED (USED) BY FINANCING ACTIVITY:
Shares issued 1,300 7,000
Additional paid up capital 63,700 45,000
-------- --------
Total cash provided by financing 65,000 52,000
-------- --------
CASH CHANGE 13,459 51,986
CASH BEGINNING 51,986 -
-------- --------
CASH ENDING $ 65,445 $ 51,986
======== ========
COMPRISED OF: Cash $ 65,445 $ 51,986
======== ========
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
Page 5 of 8
BIDDER COMMUNICATIONS, INC.
Interim Statement of Changes in Stockholders' Equity
From Inception, 16 November 1999, to 30 September 2000
Audited - See Independent Auditors' Report
Common Common Additional
Stock Stock Paid-in Deficit
Issued Amount Capital
Consideration -------- ------ ---------- -------
<S> <C> <C> <C> <C>
Private placement for cash
on 1 December 1999 2,000,000 $2,000 $ 0
Private placement for cash
on 1 December 1999 5,000,000 5,000 45,000
Net loss from incorporation,
16 November 1999, to
31 December 19999 (909)
--------- ------ -------- --------
Balance as at
31 December 1999 7,000,000 7,000 45,000 (909)
Private placement for cash
on 31 July 2000 1,300,000 1,300 63,700
Net loss for the nine months
ended 30 September 2000 - - - (22,908)
--------- ------ -------- --------
Balance as at
30 September 2000 8,300,000 $8,300 $108,700 $(23,817)
========= ====== ======== ========
</TABLE>
22
<PAGE>
Page 6 of 8
BIDDER COMMUNICATIONS, INC.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
For the Nine Months Ended 30 September 2000 and for the
period from Inception, 16 November 1999 to December 31, 1999
Audited - See Independent Auditors' Report
Note 1 THE CORPORATION AND ITS BUSINESS
Bidder Communications, Inc. was incorporated in the State of Nevada, United
States on 16 November 1999.
The Company has offices in Vancouver, British Columbia, Canada. The Company
has been organized to create software for the internet. The Company is
presently establishing itself as a going concern. Operations started in the
month of December 1999. The fiscal year end of the Company is 31 December.
Note 2 SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
These interim financial statements have been prepared in United States
dollars , which have been rounded to the nearest whole dollar except for the
net loss per share which has been founded to the nearest cent, using United
States of America Generally Accepted Accounting Principles. These accounting
principles are applicable to a going concern, which contemplates the
realization and liquidation of liabilities in the normal course of business.
Current business activity has just begun and insufficient revenue has been
generated to sustain the Company as a going concern without the infusion of
additional capital.
Revenue is recorded as a sale at the time the goods are shipped from the
Company's warehouse. Costs are recorded at the time an obligation to pay
occurs and are expensed at the time the benefit to the Company is matched to
revenue or, if there is no matching revenue, to the period in which the
benefit is realized.
Capital assets are recorded at their cost and amortized at 20% of their
declining balance.
Note 3 CAPITAL ASSETS
<TABLE>
<CAPTION> Unamortized Unamortized
Cost Cost
Accumulated 30 September 31 December
Cost Amortization 2000 1999
----- ------------ ------------ -----------
<S> <C> <C> <C> <C>
Furniture $ 531 $ 80 $ 451 -
Computer equipment 16,027 2,305 13,722 -
Software 11,616 1,504 10,112 -
------ -------- -------- -------
$28,174 $ 3,889 $ 24,285 -
======= ======== ======== =======
</TABLE>
23
<PAGE>
Page 7 of 8
BIDDER COMMUNICATIONS, INC.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
For the Nine Months Ended 30 September 2000 and for the
period from Inception, 16 November 1999 to December 31, 1999
Audited - See Independent Auditors' Report
Note 4 SHARE CAPITAL
The authorized capital stock is 100,000,000 shares of common stock
with a par value of $0.001.
8,300,000 shares of common stock have been issued as follows:
<TABLE>
<CAPTION>
ADDITIONAL
SHARE PAID IN
CONSIDERATION DATE ISSUED CAPITAL CAPITAL TOTAL
------------- ---- ------ ------- --------- -----
<S> <C> <C> <C> <C> <C>
Private placement 1 Dec 1999 2,000,000 $2,000 $ 0 $ 2,000
for cash
Private placement 12 Dec 1999 5,000,000 $5,000 45,000 50,000
for cash
----------- --------- ------ ------- ------
Balance as at 31 Dec 1999 7,000,000 7,000 45,000 52,000
Shares issued for
the nine months
ended 30 September 2000 1,300,000 1,300 63,700 65,000
--------- ------ ------ ------
Balance as at 30 Sep 2000 8,300,000 $8,300 $108,700 $117,000
</TABLE>
On 1 December 1999 the Company issued 2,000,000 common shares with a par
value of $0.001 for $0.001 per share. On 12 December 1999 the Company issued
5,000,000 common shares with a par value of $0.001 for $.01 per share. These
shares are "control securities" which cannot be sold except pursuant to
certain limitations and restrictions. On 31 July 2000 the Company issued
1,300,000 common shares with a par value of $0.001 for $.05 per share. The
shares have no trading restrictions.
NOTE 5 INCOME TAXES
Income taxes on losses have not been reflected in these financial statements
as it is not virtually certain that these losses will be recovered before the
expiry period of the loss carry forwards.
24
<PAGE>
NOTE 6 LOSS PER SHARE
Basic loss per share is computed by dividing losses available to common
stockholders by the weighted-average number of common shares during the
period. Diluted loss per share is calculated on the weighted average number
of common shares that would have resulted if dilutive common stock equivalents
had been converted to common stock. No stock options or similar rights were
available or granted during the period presented. Accordingly, basic and
diluted loss per share are the same for all periods presented.
NOTE 7 RELATED PARTY TRANSACTION
The officers and directors of the Company are involved in other business
activities, and may, in the future become active in additional other business
activities. If a specific business opportunity becomes available, such
persons may face a conflict in selecting between the Company and their own
business interests. The Company has not formulated a policy for the
resolution of such conflicts.
SIGNATURES
----------
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Bidder Communications, Inc.
By:/s/ Jon H. Suk, President and Director
By:/s/ James Y.S. Suk, Secretary/Treasurer
and Director
In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of Registrant in the capacities and on the
dates indicated:
By: /s/ Jon H. Suk, President and Director
Dated: December 12, 2000
By: /s/ James Y. S. Suk, Secretary, Treasurer and Director
Dated: December 12, 2000
25
<PAGE>
