As filed with the Securities and Exchange Commission on September 1, 2000
Registration Statement No. 333-_______
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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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SPEEDECLAIM.COM, INC.
(Name of Small Business Issuer in its Charter)
Nevada 737 88-0454486
(State or jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or Classification Code Number) Identification No.)
organization)
2000-1066 West Hastings Street, Vancouver, B.C., Canada V6E 2X3 (604) 601-8233
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(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
Corporate Services of Nevada, 502 North Division Street, Carson City,
Nevada 89703 (775) 883-3711
(Name, address and telephone number 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 of 1933, please check the following box
and list the Securities Act of 1933 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 of 1933, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act of 1933, please 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
<TABLE>
<CAPTION>
----------------------------- -------------------- ----------------------- ----------------------- -------------------
Proposed Maximum Proposed Maximum
Title of Each Class of Amount to be Offering Price per Aggregate Offering Amount of
Securities to be Registered Registered Unit (1) Price Registration Fee
----------------------------- -------------------- ----------------------- ----------------------- -------------------
----------------------------- -------------------- ----------------------- ----------------------- -------------------
<S> <C> <C> <C> <C>
Units (2) 100,000 Units $5.00 $500,000 $132.00
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Common Stock, $0.001 Par 100,000 Shares $6.00 $600,000 $159.00
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Common Stock, $0.001 Par 100,000 Shares $10.00 $1,000,000 $264.00
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Class A Warrants (6) 100,000 Warrants 0 0 0
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Class B Warrants (6) 100,000 Warrants 0 0 0
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Total Registration Fee $555.00
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<FN>
(1) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457(a) based on a bona fide estimate of the maximum offering
price.
(2) Consisting of one share of common stock, $.001 par value, one Class
A warrant and one Class B warrant, each exercisable to purchase one share of
common stock.
(3) Issuable upon exercise of the Class A Warrants included as part of the Units offered herein to the
public.
(4) Issuable upon exercise of the Class B Warrants included as part of the Units offered herein to the
public.
(5) The maximum number of Class A or Class B redeemable purchase
warrants (a maximum of 100,000 warrants for each class) contained in the units
being offered. The warrants are immediately detachable and tradeable.
</FN>
</TABLE>
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The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until the Registration Statement
shall become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
<PAGE>
SUBJECT TO COMPLETION, DATED SEPTEMBER ___, 2000
SPEEDECLAIM.COM, INC.
100,000 Units
(Each unit consists of 1 share of common stock, 1 Class A redeemable
purchase warrant and 1 Class B redeemable purchase warrant)
================================================================================
We are offering a minimum of 50,000 units and a maximum of 100,000 units.
o You may exercise the Class A and B warrants for a 6 month and 12 month
period respectively, commencing on the closing of the offering.
o You are entitled to purchase one share of common stock at $6.00 per share
for each Class A warrant exercised and one share of common stock at $10.00
per share for each Class B warrant exercised.
o No public market exists for the units, common stock and redeemable
warrants.
THESE SECURITIES ARE HIGHLY SPECULATIVE AND INVOLVE A HIGH DEGREE OF RISK AND
IMMEDIATE DILUTION. PURCHASE OF THESE SECURITIES SHOULD BE CONSIDERED ONLY BY
THOSE PERSONS WHO CAN SUSTAIN A TOTAL LOSS OF THEIR INVESTMENT. SEE "RISK
FACTORS" BEGINNING ON PAGE 4 FOR A DISCUSSION OF FACTS YOU SHOULD CONSIDER
BEFORE INVESTING.
NEITHER THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE
SECURITIES COMMISSION, INCLUDING THE BRITISH COLUMBIA SECURITIES COMMISSION, HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS
TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
================================ ====================== ============================== ========================
=================== Total of Maximum
Per Unit Total of Minimum Offering Offering
<S> <C> <C> <C>
Public offering price: $5.00 $250,000 $500,000
================================ ====================== ============================== ========================
</TABLE>
o We will terminate the offering period on December 31, 2000 unless we extend
it for an additional 90 days to March 31, 2001. We may terminate the
offering if the units are sold before the end of the offering period or if
we decide to terminate it earlier.
o We are offering these units directly to you without the assistance of an
underwriter. We will receive all the proceeds from the offering less
offering expenses.
o We will deposit all funds received from investors in a non-interest bearing
escrow account. The escrow agent will release the funds to us only if we
collect at least $250,000 during the offering period.
o If we do not sell at least 50,000 units before expiration of the offering
period, we will fully refund all funds received from you without interest.
The date of this Prospectus is September __, 2000.
--------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
CALCULATION OF REGISTRATION FEE ............................ ii
PROSPECTUS SUMMARY ......................................... 3
RISK FACTORS ............................................... 4
USE OF PROCEEDS ............................................ 15
DETERMINATION OF OFFERING PRICE ............................ 15
DILUTION ................................................... 16
SELLING SECURITY HOLDERS ................................... 17
PLAN OF DISTRIBUTION ....................................... 17
LEGAL PROCEEDINGS .......................................... 18
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS 18
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL ................... 20
OWNERS AND MANAGEMENT ...................................... 20
DESCRIPTION OF SECURITIES AND UNITS ........................ 21
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES .............................. 24
DESCRIPTION OF BUSINESS .................................... 24
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS ............................... 32
DESCRIPTION OF PROPERTY .................................... 34
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS ... 35
EXECUTIVE COMPENSATION ..................................... 35
FINANCIAL STATEMENTS ....................................... 38
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE ................................ 47
LEGAL OPINION .............................................. 47
EXPERTS .................................................... 47
HOW YOU CAN GET MORE INFORMATION ABOUT US .................. 47
<PAGE>
PROSPECTUS SUMMARY
We have prepared this summary to assist you in your review of this
document. This summary highlights what we believe are the significant aspects of
our business and this offering. However, this summary does not include all of
the information in this document that may be important to you. You should
carefully read this entire document, including the specific risks described in
the "RISK FACTORS" section beginning on page 4 and the other documents to which
we refer, and the financial statements including the notes. For more information
about the Company, see "HOW YOU CAN GET MORE INFORMATION ABOUT US."
Speedeclaim.com
We have developed a comprehensive business to business software application that
will provide the auto glass industry with seamless insurance claim, parts order
processing and instant video-claims approval via the Internet. Currently, we
offer a fully integrated e-commerce claims processing and management software
that reduces the average cost to process an auto glass insurance claim by as
much as 65%.
Our software incorporates all the functionality required to successfully conduct
e-commerce on the Internet from the subscriber's browser. Initially, we hope to
be able to provide our system to over 1,600 auto glass retail and wholesale
stores through a proposed joint venture agreement with the Independent Glass
Association (the "IGA") and its buying consortium AmeriGlass Inc.
We are currently negotiating with the IGA to sign a letter of intent for a joint
venture agreement whereby we will provide our system to over 1,600 IGA
independent retail glass stores. The IGA will provide us with their industry
expertise and specific functional requirements for our software as well as
introductions to various insurance companies. We expect to provide our system to
the IGA members free of charge and we will absorb the development costs specific
to the IGA's functional requirements. We anticipate the letter of intent will be
complete before August 30, 2000 with the development of our system completed
before the end of year 2000.
Approximately eleven million windshields are replaced each year in the United
States alone, at a cost of over $4.8 billion per year and insurance companies
pay a $15 to $50 processing fee per claim to network call centers. The auto
glass industry and the associated auto glass insurers have all expressed a need
for an online claims processing system that is significantly more cost effective
than the existing system.
Speedeclaim was incorporated under the laws of the State of Nevada on March 14,
2000. Our offices are located at 1066 West Hastings Street, Vancouver, B.C.,
Canada V6E 2X3. The telephone number is (604) 601-8233.
The Offering
<TABLE>
<S> <C>
Units 100,000 units (maximum offering)
50,000 units (minimum offering)
Common Stock to be outstanding
after this Offering 6,102,000 shares (maximum offering)
6,052,000 shares (minimum offering)
Use of Proceeds
(maximum or minimum offering) working capital and other general corporate purposes
</TABLE>
Each unit contains one share of common stock, one Class A redeemable common
stock purchase warrant which entitles the holder to purchase one share of common
stock at a price of $6.00 per share, and one Class B redeemable common stock
purchase warrant which entitles the holder to purchase one share of common stock
at a price of $10.00 per share. See "DESCRIPTION OF UNITS".
We are offering the units directly to the public without using an underwriter.
The offering is made on a "best efforts all or none" basis with respect to the
first 50,000 units and on a "best efforts only" basis with respect to the
remaining 50,000 units. Investors must make full payment for their purchases by
check made payable to "Securities Transfer Corporation as escrow agent for
Speedeclaim.com, Inc."
RISK FACTORS
In addition to the other information specified in this Prospectus, the following
risk factors should be considered carefully in evaluating the Company and our
business before purchasing any of the units. A Purchase of the units is
speculative in nature and involves numerous risks. No purchase of the units
should be made by any person who cannot afford to lose the entire amount of such
investment.
THIS PROSPECTUS SPECIFIES FORWARD-LOOKING STAEMENTS THAT INVOLVE RISKS AND
UNCERTAINIES. OUR ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THE RESULTS
DISCUSSED IN THE FORWARD-LOOKING STATEMENTS AS A REUSLT OF CERTAIN FACTORS,
INCLUDING THOSE SPECIFIFED IN THE FOLLOWING RISK FACTORS AND ELSEWHERE IN THIS
PROSPECTUS. PROSPECTIVE PURCHASERS OF UNITS MUST BE PREPARED FOR THE POSSIBLE
LOSS OF THEIR ENTIRE INVESTMETNS IN THE COMPANY. THE ORDER IN WHICH THE
FOLLOWING RISK FACTORS ARE PRESENTED IS ARBITRARY, AND THE PROSPECTIVE
PURCHASERS OF THE UNITS SHOULD NOT CONCLUDE, BECAUSE OF THE ORDER OF
PRESENTATION OF THE FOLLOWING RISK FACTORS, THAT ONE RISK FACTOR IS MORE
SIGNIFICANT THAN THE OTHER RISK FACTORS.
Information specified in this Prospectus contains "forward looking statements"
which can be identified by the use of forward-looking terminology such as
"believes", "could", "possibly", "probably", "anticipates", "estimates",
"projects", "expects", "may", "will", or "should" or the negative thereof or
other variations thereon or comparable terminology. Such statements are subject
to certain risks, uncertainties and assumptions. No assurances can be given that
the future results anticipated by the forward looking statements will be
achieved. The following matters constitute cautionary statements, identifying
important factors with respect to such forward-looking statements, including
certain risks and uncertainties, that could cause actual results to vary
materially from the future results covered in such forward-looking statements.
Among the key factors that have a direct bearing on our results of operations
are the effects of various governmental regulations, the fluctuation of the
direct costs and the costs and effectiveness of our operating strategy. Other
factors could also cause actual results to vary materially from the future
results covered in such forward-looking statements.
We have limited resources, have sustained losses since our inception and expect
to continue to do so.
As of June 30, 2000, we had working capital of $7,308 and incurred losses
totaling approximately $570,418. We are dependent upon the proceeds of this
offering to implement our business plan. Since we are in the developmental stage
and have no share of the Internet market, we may incur losses for a long time.
We have a short operating history upon which you can judge our prospects.
We are a recently organized company and have no significant operating history or
operating revenues. In order to be successful, we must contract with insurance
claim companies to generate transaction fees, attract a significant number of
users to the website and database delivered through our website and generate
significant e-commerce revenues.
Specifically, as an early stage entity in the rapidly evolving market for
Internet services, we will face numerous risks and uncertainties including our
ability to:
o anticipate and adapt to changing Internet technologies;
o attract a substantial number of users to the Speedeclai6m system;
o generate significant ecommerce revenues;
o develop a sales force;
o implement sales and marketing initiatives;
o attract, retain and motivate qualified personnel;
o respond and adjust to actions taken by competitors;
o build an operations and technical infrastructure to effectively manage
growth; and
o integrate new technologies and services.
We have a major task ahead of us and may not be successful in achieving our
goals.
Since we are new and small, we face significant competition from established
Internet and industry players and others.
The market for Internet business-to-business commerce software and services is
relatively new, intensely competitive, quickly evolving and subject to rapid
technological change. We expect competition will increase in the future.
However, as yet no company competes directly with our Internet-based
`distributed client server' claims resolution, and part ordering system. There
are companies such as Mitchell and PPG Linx that offer expensive electronic data
interchange (EDI) claims processing software that must be installed and operated
at the customer site. These are seen as competitive products but do not address
comprehensive claims processing via the Internet. The Internet industry is, and
you can expect it to remain, highly competitive for the following reasons, among
others:
o there are no substantial barriers to entry into this arena;
o the number of businesses competing for users;
o the spending of Internet advertisers and e-commerce marketers has
increased significantly; and
o industry consolidation.
We expect that this increased competition will result in:
o less usage of our services; and
o reduced margins or loss of market share.
If any of these factors occur, they would obviously have a negative effect on
our business, results of operations and financial condition.
Our competitors include:
o in-house custom solutions built by a national glass chain's information
technology group; and
o products and components offered by companies such as GTS, IBS, Quest,
PPG Linx and Mitchell.
Other potential competitors have not yet made a transition to the Internet and
have not addressed the commercial aspects of an Internet solution. The emergence
of the Internet and the creation and adoption of new standards such as
Extensible Mark-up Language (XML) are creating a new group of competitors. Some
of these competitors are large companies (e.g., IBM) who have greater name
recognition and more resources at their disposal.
Many of our existing potential competitors, as well as a number of potential new
competitors, have longer operating histories, greater name recognition, larger
customer bases and significantly greater financial, technical and marketing
resources than we do. This may allow them to devote greater resources than we
can to the development and promotion of their services.
These competitors may also engage in more extensive research and development,
undertake more far-reaching marketing campaigns, adopt more aggressive pricing
policies and make more attractive offers to existing and potential employees,
distribution partners, and advertisers and e-commerce partners. Our competitors
may develop services that are equal or superior to ours or that achieve greater
market acceptance than ours. Competitive factors in the Internet-based software
and services markets include innovative technology, breadth of product features,
product quality, communications, marketing, distribution resources, customer
service and support and price. While we believe that its experience to date
demonstrates its ability to compete, there can be no assurance that the company
will be able to compete successfully against current or future competitors.
If we do not partner with the IGA, our chances for success will be severely
diminished.
Our business model is dependent on acceptance and the use of our system by auto
glass retail and wholesale stores and the insurance companies. We are currently
in the process of negotiating an agreement with the IGA to implement our system.
If we are unsuccessful in achieving such a partnership, it will be difficult for
us to obtain subscribers for our system.
Each glass vendor must have Internet access.
Our business model assumes that the retail glass vendor has access to the
Internet. Notwithstanding the fact that we will provide free access to the
system, the system only works if the user has a computer and video capability.
We do not intend to give away the computer hardware necessary to use the system.
We need to grow and manage our growth to become profitable.
If we do not grow, we will probably not become profitable. However, if we grow,
develop and increase the size of our business, the demands on our operational
systems will also increase. We will be required to further develop our
operational and financial systems and managerial controls and procedures. We
will also then need to expand, train and manage a team of staff. We do not
currently have the resources for this type of expansion and may not be
successful in our expansion efforts. Accordingly, we will limit or even entirely
negate our chances to be profitable if we do not grow or if we cannot manage our
growth.
We are understaffed and we may not be able to accomplish our goals unless we get
additional help.
We are currently understaffed. If we raise the money from the offering, our plan
is to hire additional employees. We may not be able to attract qualified
individuals to join us.
If we lose the services of David Whyte, Dennis Rohel or Alastair King, our
chances of success will be diminished.
We are heavily dependent on the efforts of our limited staff, especially our
executive officers. The loss of the services of any of these individuals,
especially Mr. Whyte, would be devastating to our plans and significantly
diminish our chances of success. Although we have employment agreements with
Messrs. Whyte, Rohel and King, there is no guarantee that such individuals will
complete their terms of employment with the Company. See "EXECUTIVE
COMPENSATION". We do not have key man life insurance coverage on Messrs. Whyte,
Rohel or King. Furthermore, none of Messrs. Whyte, Rohel or King has ever
managed a company together.
If the growth of the Internet slows down, we will not be as profitable as we
currently project.
Our future success is substantially dependent on the continued growth in the use
of the Internet. The Internet is relatively new and is rapidly changing. Our
business would be adversely affected if Internet usage does not continue to
grow. This usage may be inhibited for a number of reasons, such as the Internet
infrastructure not being able to support the demands placed on it, or its
performance and reliability may decline as usage grows. Similarly, an adverse
affect may be caused by privacy concerns, or by security and authentication
concerns with respect to transmission over the Internet of confidential
information, such as credit card numbers, and attempts by unauthorized computer
users to penetrate online security systems.
If the Internet industry slows down, we will experience a lower than expected
number of Internet users using our services. This slow down would in turn
decrease the attractiveness of our Internet software and database application
platform to potential customers and result in a reduction in revenues. In
addition, an Internet industry slow down would result in a reduction in the
number of independent glass stores requiring Internet services and therefore
reduce the revenues we receive by providing Internet services to these
businesses.
In order to keep up with technological advances, we may have to incur additional
costs to modify services or infrastructure.
Our market is characterized by rapidly changing technologies, evolving industry
standards, frequent new service introductions and changing customer demands. To
be successful, we must adapt to a rapidly evolving market by continually
enhancing our infrastructure, technology, information and services to fulfill
our users' needs. We could incur additional costs if it becomes necessary to
modify services, technology or infrastructure in order to adapt to these or
other changes affecting providers of Internet services. Our business, results of
operations and financial condition could be materially adversely affected if we
incur significant costs to adapt, or if we cannot adapt, to these changes.
The impact of governmental regulation may increase our costs and impede our
growth.
There is an increasing number of laws and regulations pertaining to the
Internet. In addition, a number of legislative and regulatory proposals are
under consideration by federal, state, local and foreign governments and
agencies. Laws or regulations may be adopted with respect to:
o the Internet relating to liability for information retrieved from or
transmitted over the Internet;
o online content regulation;
o user privacy;
o taxation; and
o Quality of products and services.
Moreover, the applicability to the Internet of existing laws governing issues
such as intellectual property ownership and infringement, copyright, trademark,
trade secret, obscenity, libel, employment and personal privacy is uncertain and
developing. Any new legislation or regulation, or the application or
interpretation of existing laws, may decrease the growth in the use of the
Internet, which could in turn decrease the demand for our services, increase our
cost of doing business or otherwise have a material adverse effect on our
business, results of operations and financial condition.
We may be liable for information retrieved from our websites and the Internet.
Users may access contents on our websites or the websites of our future
partners. Those contents may then be downloaded by users and transmitted to
others over the Internet. This users transmittal of contents found on our
websites could result in claims against us based upon a variety of theories,
including negligence, copyright or trademark infringement or other theories
based upon the nature, publication and distribution of this content. These types
of claims have been brought, sometimes successfully, against providers of
Internet services in the past. We could also be exposed to liability with
respect to third party content that may be posted by users in chat rooms or
message boards. It is also possible that if any information, including
information deemed to constitute professional advice such as legal, or
financial, or provided on our system contains errors or false or misleading
information, third parties could make claims against us for losses incurred in
reliance upon such information. In addition, our websites contains annotated
links to other websites. As a result, we may be subject to claims alleging that,
by directly or indirectly providing links to other websites, we are liable for
copyright or trademark infringement or wrongful actions of third parties through
their respective websites. While we will attempt to reduce our exposure to
potential liability, the enforceability and effectiveness of such measures are
uncertain. Even to the extent that such claims do not result in liability to us,
we could incur significant costs in investigating and defending against such
claims. Potential liability for information disseminated through us could lead
us to implement measures to reduce our exposure to such liability, which may
require the expenditure of substantial resources and limit the attractiveness of
our service to users.
If we do not develop an effective sales force, we may not generate significant
revenues or become profitable.
We currently have 14 employees and 1 sales team member. In order to grow, we
must develop an internal sales team. Our ability to do so successfully involves
a number of factors. They include:
o the competition in hiring and retaining sales personnel;
o our ability to integrate and motivate sales personnel; and
o the length of time it takes for new sales personnel to become
effective.
Our failure to develop and maintain an effective advertising sales team would
certainly have a negative effect upon our business prospects.
Our services are susceptible to disruptive problems, failures and damages to our
systems.
The technical performance of our network, software and hardware systems is
critical to our business and reputation, and to our ability to attract users,
advertisers and ecommerce partners. Any network, software or hardware systems
failure, including computer viruses, electronic break-ins or other similar
disruptions and failure, that causes an interruption in our service or a
decrease in our responsiveness could result in reduced usage and reduced
revenue. These failures could negatively effect our reputation and operations.
We must be able to accommodate a high volume of traffic and may experience
slower response times for a variety of reasons. An increase in volume of users
accessing our system could lead to systems failures or slower response times and
ultimately reduce revenues. Our users may become dissatisfied by any system
failure that interrupts our ability to provide services to them. In addition,
our users will depend on a third party Internet service provider for access to
our system. This provider may in the future experience significant outages,
delays and other difficulties due to system failures unrelated to our systems.
Moreover, the Internet infrastructure, in general, may not be able to support
continued growth in its use. These are factors, events and occurrences over
which we have no control. Yet, they can have a negative impact on our business.
Any revenues received in Canadian dollars would decrease in value because of the
unfavorable currency exchange rate.
Although our operations are located in Canada, we do not intend to do business
in Canada as our system is not compatible with the Canadian auto insurance
process. Moreover, any revenue generated will be paid to our U.S. bank account.
However, to the extent that we recognize any revenues in Canadian dollars, the
continued lowering of the value of the Canadian dollar vis-a-vis the US dollar
may have a materially adverse effect on our business, results of operations and
financial condition.
Because no one is obligated to purchase the units, we cannot be certain that
even the minimum offering will be sold.
No person or entity, including us or our officers and directors, has committed
to purchase any of the units. So there is no assurance that we will be
successful in selling the units. The offering period will terminate on December
31, 2000 unless we extend it for an additional 90 days to March 31, 2001. We can
terminate the offering earlier if the 100,000 units are sold before the end of
the offering period, as extended, or if we decide to terminate it earlier. We
are making this offer on a "best efforts, all or none" basis for the first
50,000 units and on a "best effort only" basis only for the remaining 50,000
units. Your monies will be deposited in an escrow account. If we do not sell at
least 50,000 units by December 31, 2000 or by the extended date of March 31,
2001, your monies will be refunded without interest. In that case, you may not
have use of your moneys for up to 180 days. If we sell only the minimum offering
of 50,000 units, we will receive net proceeds of approximately $250,000. If we
receive only that amount, or insignificantly more, it is likely that we will
need further financing in the near future. We may not be able to obtain this
financing at reasonable terms or even at all.
Even if the offering is successful, we may not have the financial resources
necessary to achieve our business strategy.
The offering is expected to net us approximately $450,000 for working capital
purposes. Even if we are successful in obtaining such amount, there is no
guarantee that said amount will be sufficient for our operations. If additional
funds are raised by the issuance of equity securities, then existing
shareholders will experience dilution of their ownership interest. If additional
funds are raised by the issuance of debt or other instruments, we may be subject
to certain limitations on our operations and the issuance of such securities may
have rights senior to those of the then existing holders of common stock. If
adequate funds are not available or not available on acceptable terms, we may be
unable to fund expansion, develop our business operations or respond to
competitive pressures.
Because we are attempting to sell the units without the aid of an underwriter,
our chances of success are reduced and you do not have an underwriter's
expertise to evaluate us.
We are not experienced in the business of selling securities. We may, therefore,
not be able to complete the minimum offering. In addition to providing selling
expertise, an underwriter is also required to conduct a due diligence evaluation
of any company whose securities it underwrites. In this situation, there is no
underwriter, and no one is providing due diligence evaluations on your behalf.
We may redeem the warrants and this may dilute our existing shareholders.
We may redeem the warrants at a price of $0.01 per warrant upon 30 days' prior
written notice to the holders thereof, if the average closing bid price of our
common stock for any 7 trading days during a 10 consecutive trading days period
is greater than 20% above the respective exercise price.
If we redeem the warrants, warrant holders will have thirty days during which
they may exercise their rights to purchase shares of common stock. In the event
a current prospectus is not available, the warrants may not be exercised and we
will not be precluded from redeeming the warrants. If holders of the warrants
elect not to exercise them upon notice of redemption thereof, and the warrants
are subsequently redeemed prior to exercise, the holders thereof would lose the
benefit of the difference between the market price of the underlying common
stock as of such date and the exercise price of such warrants, as well as any
possible future price appreciation in the common stock. As a result of an
exercise of the warrants, existing shareholders would be diluted and the market
price of the common stock may be adversely affected. If a warrant holder fails
to exercise his rights under the warrants prior to the date set for redemption,
then the warrant holder will be entitled to received only the redemption price,
$0.01 per warrant.
Management and principal shareholders have complete control over our company and
investors may not have an effective voice in the management of our company.
If we complete the minimum offering, our current management and principal
shareholders will own approximately 83.2% of the outstanding shares of our
common stock on a fully diluted basis. Similarly, if we complete the maximum
offering, they will own approximately 82.4% of the outstanding shares of our
common stock on a fully diluted basis. Accordingly, in either case, they will be
able to control the management policies and conduct of our business.
Shares eligible for sale after the offering is completed could negatively affect
our stock prices.
The prevailing market price of our units, common stock and warrants after we
complete the offering could be adversely affected by sales of common stock by
the holders of our common stock already outstanding, or the perception that
these sales may occur.
All of the 6,002,000 shares of our outstanding common stock are "restricted
securities", and, after being held for a period of one year, may be sold in
compliance with Rule 144 of the Securities Act. Rule 144 provides, in essence,
that a person after holding "restricted securities" for a period of one (1)
year, may sell an amount that does not exceed:
o more than one percent of the Company's shares then outstanding within
any three month period, (i.e. one percent would equal 60,020 shares as
of the date of this Prospectus, 60,520 shares immediately after the
successful completion of the minimum offering, and 61,020 shares
immediately after the successful completion of the maximum offering.
(This 1% calculation does not include any exercise of the redeemable
purchase warrants offered by us); or
o the average weekly trading volume during the 4 weeks before any sale
under Rule 144.
Further, under Rule 144, the amount of "restricted securities" which a person,
who is not an affiliate of our company, may sell is not limited when his or her
shares are held for over two (2) years.
If the sale of our shares under Rule 144 has a depressive effect upon the market
price of our securities, we could have difficulty in raising additional capital
through the issuance of more securities. Finally, the exercise of the warrants,
may also have a depressive effect upon the market price of our common stock,
should one exist.
You may not be able to sell our securities unless a public market develops for
them.
Prior to this offering, there has been no public market for any of our
securities and we are not certain that an active trading market for the
securities offered will develop or be sustained after this offering. We
anticipate that, after we complete the offering, the units, common stock and the
warrants will be eligible for listing on the NASD Over-the-Counter Electronic
Bulletin Board. If for any reason, however, our securities are not eligible for
continued listing or a public trading market does not develop, you may have
difficulty selling your securities should you desire to do so. If we are unable
to satisfy the requirements for quotation on the Bulletin Board, trading, if
any, in our securities would be conducted in the over-the-counter market in what
are commonly referred to as "pink sheets". As a result, you may find it more
difficult to dispose of, or to obtain accurate quotations as to the price of our
securities.
We determined our own unit prices and the exercise prices for the warrants.
On our own, we determined the initial public offering price of the units, as
well as the exercise price of the warrants using a number of factors. We
considered our financial condition and prospects, market prices of similar
securities of comparable publicly traded companies, certain financial and
operating information of companies engaged in activities similar to ours and the
general conditions of the securities market. They are not predictive of the
market price for the units, common stock or the redeemable purchase warrants in
the trading market after this offering. You should be aware that the market
price of the securities may decline below the initial public offering price. The
stock market has experienced extreme price and volume fluctuations especially
the securities of Internet-related companies.
You will suffer immediate and substantial dilution.
The offering price per unit in this offering significantly exceeds the net
tangible book value per common share. Accordingly, investors purchasing the
units in this offering will suffer immediate and substantial dilution of their
investment.
Our securities might be referred to as "penny stocks" which are not perceived
favorably in the market place.
The SEC has adopted regulations which generally define a "penny stock" to be any
equity security that has a market price of less than $5.00 per share or an
exercise price of less than $5.00 per share, subject to certain exceptions. Our
securities may become subject to rules that impose additional sales practice
requirements on broker-dealers who sell such securities to persons other than
established customers and accredited investors (generally those with a net worth
in excess of $1,000,000 or annual income exceeding $200,000, or $300,000
together with their spouse). For transactions covered by these rules, the
broker-dealer must:
o make a special suitability determination for the purchase of such
securities;
o have received the purchaser's written consent to the transaction prior
to the purchase;
o deliver to the purchaser, prior to the transaction, a disclosure
schedule prepared by the SEC relating to the penny stock market;
o disclose to the purchaser the commission payable to the broker-dealer
and the registered representative;
o provide the purchaser with current quotations for the securities;
o if the broker-dealer is the sole market maker, he must disclose that
fact to the purchaser and his presumed control over the market; and
o provide the purchaser with monthly statements disclosing recent price
information for the penny stock held in the account and information on
the limited market in penny stocks.
Consequently, the "penny stock" rules may restrict the ability of broker-dealers
to sell our securities in the secondary market, if one is formed.
Our management has broad discretion over the use of the proceeds raised in the
offering.
We intend to use all of the net proceeds of the offering (either minimum or
maximum) for working capital and general corporate purposes. Accordingly, our
management will have broad discretion as to the application of such proceeds. In
this regard, a portion of the funds allocated to working capital will be
utilized to pay the salaries of our officers and you do not know if, when or how
often their salaries will be increased.
You cannot exercise the warrants if we do not have a current prospectus.
The warrants are exercisable only if a current prospectus is then in effect, and
only if such shares are qualified for sale under applicable state securities
laws of the states in which the redeemable purchase warrant holders reside. We
have no contractual obligation to maintain an effective registration statement
and therefore a warrant holder may not be able to exercise the warrants when
desired to do so. As of the date of this prospectus, our units, common stock and
warrants have been qualified in the States of New York and Florida only.
Accordingly, residents of only New York and Florida (or non U.S. residents) can
currently exercise warrants.
Our redemption of the warrants may force holders to make an investment decision
before they are ready.
The warrants are subject to redemption after the completion of this offering and
during the remainder of the term of the warrants. If we decide to redeem the
warrants, holders will lose their rights to purchase shares of common stock
issuable upon exercise unless the warrants are exercised before they are
redeemed. Holders may be forced to make an investment decision regarding their
warrants before they are ready to do so if we send a notice of redemption.
Although it is not our intention to do so, we can send the notice when our
prospectus is not current. Holders would then not be able to exercise the
warrants even if they desired to do so.
Control by Existing Stockholders; Anti-Takeover Provisions.
Our directors, officers and principal (greater than 5%) stockholders, taken as a
group, together with their affiliates, beneficially own, in the aggregate,
approximately 84.7% of the Company's outstanding common stock on a fully diluted
basis. Certain principal stockholders are directors or executive officers of the
Company. As a result of such ownership, these stockholders may be able to exert
significant influence, or even control, matters requiring approval by the
stockholders of the Company, including the election of directors. In addition,
certain provisions of Nevada law and of the Company's Articles of Incorporation
and By-laws could have the effect of making it more difficult or more expensive
for a third party to acquire, or of discouraging a third party from attempting
to acquire, control of the Company.
No Foreseeable Dividends.
We do not anticipate paying dividends on our common stock in the foreseeable
future; but, rather, we plan to retain earnings, if any, for the operation and
expansion of our business. Any payment of cash dividends in the future will be
at the discretion of our Board of Directors and will depend upon our earnings
levels, capital requirements, any restrictive loan covenants and other factors
that the Board considers relevant.
Federal Income Tax Consequences.
We have obtained no ruling from the Internal Revenue Service and no opinion of
counsel with respect to the federal income tax consequences of the purchase or
sale of Shares by the selling stockholders. Consequently, investors must
evaluate for themselves the income tax implications which attach to their
purchase, and any subsequent sale, of the units.
USE OF PROCEEDS
After deduction of the estimated expenses of the issuance and distribution of
the securities we will receive net proceeds of approximately $200,000 if we are
successful in completing the minimum offering, and $450,000 if we are successful
in completing the maximum offering. If we are successful in completing either
the minimum or maximum offering, we intend to use the net proceeds thereof for
working capital, including paying our key officers accrued salary, and other
general corporate purposes. We may also use a portion of the proceeds for
strategic alliances and acquisitions. We have not yet determined the amount of
net proceeds to be used specifically for each of these purposes. Therefore, our
management will have significant flexibility in applying the net proceeds of
either the minimum or maximum offering. We anticipate applying the proceeds of
this offering as soon as they are available (i.e. completion of the minimum
offering) and continuing over the following 12 months. We believe that the
proceeds of the maximum offering will be sufficient to satisfy our requirements
over this period without the necessity of obtaining additional funds. However,
we believe that if only the minimum offering is completed, additional funds may
be required which may not be available to us, or, if available, not on
reasonable terms. In addition, if we experience a change in circumstances or
business conditions we may need additional financing even if the maximum
offering is completed. Finally, any proceeds which we receive from the exercise
of the warrants shall be applied to working capital.
DETERMINATION OF OFFERING PRICE
We have arbitrarily determined the public offering price of the units and the
exercise prices of the warrants based upon various considerations including
market conditions and the perceived reception of the offering price and exercise
prices by potential investors. The public offering price and the exercise prices
do not bear any relationship to assets, book value or any other traditionally
recognized indications of value.
DILUTION
Our net tangible book value as of June 30, 2000 (based on the 6,002,000 shares
outstanding) was approximately $0.02 per share of common stock. Net tangible
book value per share is equal to our total tangible assets less our total
liabilities, divided by the total number of outstanding shares of common stock
at June 30, 2000. If we assume the sale of the minimum number of units offered,
50,000, the pro forma net tangible book value per share as of June 30, 2000
would be approximately $ 0.06. This would result in an immediate dilution to new
shareholders (i.e. the difference between the purchase price of the units,
assuming no value assigned to the warrants, and the net tangible book value per
share after the minimum offering) of $4.94 per share, or approximately 99% of
the purchase price.
Alternatively, if we assume the sale of the maximum number of units being
offered, 100,000, the pro forma net tangible book value per share as of June 30,
2000 would be approximately $0.10. This would result in an immediate dilution to
new shareholders of $4.90 per share, or approximately 98% of the purchase price.
The following table illustrates this per share dilution under both the minimum
and maximum offerings, assuming receipt of the net proceeds of both and no value
being assigned to the warrants:
Minimum Maximum
Offering Offering
--------------------------------------------------------------------------------
================================================================================
Public offering price per share $ 5.00 $ 5.00
Net tangible book value per
share as of June 30, 1999 $ 0.02 $ 0.02
Increase per share attributable
to new shareholders $ 0.04 $ 0.08
Pro forma net tangible book value
per share as of June 30, 1999
after offering $ 0.06 $ 0.10
Dilution per share to
new shareholders $ 4.94 $ 4.90
The following tables summarize, as of June 30, 2000, the number of our shares
previously purchased, the total consideration and the average price per share
paid by existing stockholders and to be paid by purchasers in the minimum and
maximum offering, assuming that no value is attributed to the warrants:
<PAGE>
<TABLE>
<CAPTION>
Minimum Offering (50,000 Units)
% of Total Avg.
Total % of Capital Effective Price
Shares Total Cash Cash Per
Purchased Shares Contrib. Contrib. Share
<S> <C> <C> <C> <C> <C>
New Shareholders(l) 50,000 0.008% $ 250,000 65.6% $ 5.00
Old Shareholders 6,002,000 99.992% 130,928 34.4% $ 0.02
------- --------- ------ -----
Total 6,052,000 100.00% $ 380,928 100.00% $ 0.06
Maximum Offering (100,000 Units)
New Shareholders 100,000 0.016% $ 500,000 79.2% $ 5.00
Old Shareholders 6,002,000 99.984% $ 130,928 20.8% $ 0.02
------- --------- ------ -----
Total 6,102,000 100.000% $ 630,928 100.0% $ 0.10
</TABLE>
SELLING SECURITY HOLDERS
There are no selling security holders.
PLAN OF DISTRIBUTION
We are offering, directly to the public, up to 100,000 units. The first 50,000
units are offered on a "best efforts all or none" basis. We are offering the
remaining 50,000 units on a "best efforts only" basis only. There can be no
assurance that any of the units will be sold. If we sell at least 50,000 of the
offered units within the offering period (90 days from the effective date of
this prospectus, i.e. December 31, 2000 unless we extend it for an additional 90
days to March 31, 2001, then the offering will be terminated and the
subscription payments, if collected, will be promptly refunded in full to
subscribers within 7 days of the termination without payment of interest or
deducting expenses, subject to the collection of funds. If we sell the minimum
number of units within the specified period, the offering will continue until
the earlier of:
o when we sell all 100,000 units or
o the expiration of the offering period and any extension, unless we
terminate the offering earlier.
All subscription payments must be sent to us along with a separate sheet
indicating the name, address and social security number of the subscriber(s),
and the number of shares for which subscription is being made. Payments must be
by check made payable to "Securities Transfer Corporation, as escrow agent for
Speedeclaim.com". We will then send the subscription payments, no later than
noon of the next business day following receipt, to an escrow account maintained
by Securities Transfer Corporation. Securities Transfer Corporation is only
acting as escrow, transfer and warrant agent in connection with this offering
and has made no investigation of us or this offering nor makes any
recommendation concerning this offering. The escrow agent will hold all
subscriptions payments pending the sale of the minimum number of units within
the specified period. Subscription payments will only be withdrawn from the
escrow account for the purpose of paying us for the units sold, if we sell at
least 50,000 of the units, or for the purpose of refunding subscription payments
to subscribers. Subscribers will not earn interest on the funds held in escrow
and will not have use or right to return of such funds during the escrow period,
which may last as long as 180 days. If we sell the minimum number of units
within the escrow period, as extended, payments from subscribers will be
deposited into the escrow account for collection and all funds will be
periodically disbursed to us.
We have not engaged a market maker of securities and do not propose to engage
any entity to make a market in our securities following completion of the
offering. The development of a trading market following the completion of this
offering will be particularly dependent on broker dealers initiating quotations
in interdealer quotation mediums, in maintaining trading positions and in
otherwise engaging in market making activities in our securities. We have not
retained a brokerdealer who has agreed to engage in such activities, and there
is no assurance that any trading market for our securities will develop
following the offering.
LEGAL PROCEEDINGS
We are not involved in any litigation, nor are we aware of any pending or
contemplated proceedings against us. We know of no legal proceedings pending or
threatened, or judgments entered against any of our directors or officers in
their capacity as such.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
Our Directors and Executive Officers
The following sets forth the names and ages of our directors and executive
officers.
Name Age Position
David Whyte 31 President and
Chairman of the Board of Directors
Alastair King 34 Chief Executive Officer,
Principal Financial Officer and
Controller, Director
Dennis Rohel 41 Chief Knowledge Officer and
Secretary
David Whyte
President and
Chairman of the Board of Directors
David Whyte, since our inception to the present, has been our President and
Chairman of the Board. From April, 1998 to the present, Mr. Whyte has served as
the founder and President of Sentec Network Solutions, which offers industries
open source venture construction of e-commerce applications and Internet
operations management. From July, 1996 to the present, Mr. Whyte has served as
the Chief Executive Officer of washecar.com, which offers business-to-business
and business-to-consumer automobile services and e-commerce applications. From
July, 1987 to the present, Mr. Whyte has served as the President of Pearls of
Pristine Auto Wash and Detail, Inc., a successful automotive cleaning and
services management business in Vancouver, British Columbia, Canada. In1987, Mr.
Whyte graduated from Handsworth Senior Secondary, North Vancouver, British
Columbia, Canada.
Alastair James King
C.E.O., Principal Financial Officer and Controller
Director
Alastair King, since our inception to the present, has been our Chief Executive
Officer and a member of the Board of Directors. From November, 1992 to the
present, Mr. King has served as the President of EnterNet Media Inc., based in
Vancouver, British Columbia, Canada, as a business consultant to various
industries. From January, 1997 to the present, Mr. King has served as the acting
Executive Vice President of Equity Retirement Savings Systems based in
Vancouver, British Columbia, Canada, which manages a universal loyalty program
for customers of various retail companies. In 1985, Mr. King received a degree
in electronic engineering technology from Okanagan College, Kelowna, British
Columbia, Canada.
Dennis Rohel
Chief Knowledge Officer and Secretary
Dennis Rohel, since our inception to the present, has served as our Chief
Knowledge Officer. From April, 1998 to August, 2000, Mr. Rohel has served as a
contract team leader for Sentec Network Solutions, Inc., based in Vancouver,
British Columbia, Canada. From May, 1996 to June, 1997, Mr. Rohel served as the
President of Wholes World, based in Vancouver, British Columbia, Canada, which
developed Internet software solutions for e-commerce applications. From January,
1994 to April, 1995, Mr. Rohel served as President of Envirotech (Canada)
Computer Services Ltd., based in Vancouver, British Columbia, Canada, which
provided network design, configuration and custom software development services
to businesses. In June, 1982, Mr. Rohel received a degree in economics and
computer science from the University of Saskatchewan, Saskatoon, Saskatchewan,
Canada.
Our three (3) Directors have been elected to serve until the next annual meeting
of stockholders and until their successor(s) have been elected and qualified, or
until death, resignation or removal.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table provides the name and addresses of each person known to us
to own more than 5% of our outstanding common stock as of July, 2000, and by the
officers and directors, individually and as a group. Except as otherwise
indicated, all shares are owned directly.
<TABLE>
<CAPTION>
Name and Address Amount of Percent of Class
of Beneficial Owner Beneficial Ownership After Offering
Minimum Maximum
50,000 Units (1) 100,000 Units (2)
<S> <C> <C> <C>
David Whyte 2,250,000 (3) 33.1% 32.8%
c/o Speedeclaim.com, Inc.
2000-1066 West Hastings Street
Vancouver, B.C., Canada V6E 2X3
Dennis Rohel 2,250,000 (4) 33.1% 32.8%
Alastair King 550,000 (5) 8.1% 8.0%
c/o Speedeclaim.com, Inc.
2000-1066 West Hastings Street
Vancouver, B.C., Canada V6E 2X3
All Officers and Directors as a Group 5,050,000 74.3% 73.6%
<FN>
(1) The percentages provided for in this column are based on 6,802,000
shares of common stock issued and outstanding as of August 31, 2000.
(2) The percentages provided for in this column are based on 6,852,000
shares of common stock issued and outstanding as of August 31, 2000.
(3) This amount of beneficial ownership includes options to purchase
250,000 shares of common stock granted pursuant to the 2000 Stock Option Plan
and which are exercisable upon the listing of the common stock.
(4) This amount of beneficial ownership includes options to purchase
250,000 shares of common stock granted pursuant to the 2000 Stock Option Plan
and which are exercisable upon the listing of the common stock.
(5) This amount of beneficial ownership includes options to purchase
250,000 shares of common stock granted pursuant to the 2000 Stock Option Plan
and which are exercisable upon the listing of the common stock.
</FN>
</TABLE>
The persons or entities named in this table, based upon the information they
have provided to us, have sole voting and investment power with respect to all
shares of common stock beneficially owned by them. The shares beneficially owned
and percentage of ownership are based on the total shares outstanding before
this offering and the total shares to be outstanding after both the minimum and
maximum offerings assuming no exercise of any of the warrants contained in the
units.
DESCRIPTION OF SECURITIES AND UNITS
The Units
We are offering a minimum of 50,000 units and a maximum of 100,000 units
directly to the public under this Prospectus. Each unit consists of one share of
common stock, $.001 par value, one Class A redeemable purchase warrant to
purchase one share of common stock at $6.00, and one Class B redeemable purchase
warrant to purchase one share of common stock at $10.00. The warrants will be
immediately detachable and transferable if we successfully complete the minimum
offering.
Common Stock
We are authorized to issue 50,000,000 shares of common stock, $.001 par value.
The holders of the common stock do not currently receive a dividend, and there
is no immediate plan for the Company to pay a dividend on the Common Stock in
the future. The following table shows the number of issued and outstanding
shares of common stock as of the date of this prospectus and which will be
outstanding in the event of the successful completion of both the minimum and
maximum offerings:
Shares Outstanding 6,002,000
Shares to be outstanding in the event of the successful
completion of the minimum offering 6,052,000
Shares to be outstanding in the event of the successful
completion of the maximum offering 6,102,000
This table does not reflect the effect that the possible exercise of the
warrants or options issued pursuant to our 2000 Stock Option Plan will have.
Each share of our common stock has equal, noncumulative voting rights and
participates equally in dividends, if any. The common stock has no sinking fund
provisions applicable to it. The shares are fully paid for and nonassessable
when issued. Currently, there are 750,000 options outstanding to purchase our
common stock pursuant to our 2000 Stock Option Plan which have an exercise price
of $1.00 per share. Except for the warrants offered herein and the options
described above, there are no other outstanding warrants, or rights to purchase
any of the securities of the Company and we do not plan to issue any.
If there are differences between the following summary description of our common
stock and our amended certificate of incorporation and by-laws, the information
contained in our amended certificate of incorporation and by-laws is
controlling.
Our shareholders are not given cumulative voting rights in electing board
members. So minority shareholders may not have any representation. Holders of
common stock:
o have equal rights to dividends from funds legally available for that
purpose, when and if declared by our board of directors;
o are entitled to share ratably in all of our assets available for
distribution to holders of common stock upon liquidation, dissolution
or winding up of our affairs; and
o do not have preemptive rights, conversion rights, or redemption of
sinking funds rights.
The Redeemable Purchase Warrants
There are no Class A and Class B warrants presently outstanding. After we issue
them, the warrants will be exercisable at:
o a price of $6.00 per share of common stock for Class A for 6 months from the
completion of this offering; and o a price of $10.00 per share of common stock
for Class B for 12 months from the completion of this offering.
We may extend each warrant exercise period at any time, and/or reduce the
exercise price(s) by up to 50%. If the exercise period is extended, you will be
given a written notice 30 days before the beginning of the extension period. One
warrant entitles the holder to purchase one share of common stock. The following
discussion of the warrants may not be complete. You should read the warrant
agreement for a complete discussion. The essential provisions of the warrants
are as follows:
o The warrants, which will be issued under the warrant agreement between
us and our warrant agent, Securities Transfer Corporation, will be in
registered form. After successful completion of the minimum offering,
the warrants may be sold, assigned or conveyed separately and apart
from the common stock included in the units.
o Upon the successful completion of the offering and during the remainder
of the term of the warrants, we may, at our option and on 30 days'
prior written notice mailed to the warrant holders, call and/or redeem
the warrants, in whole or in part, at a price of $0.01 per A or B
warrant if the average closing bid price of our common stock for any 7
trading days during a 10 consecutive trading day period is greater than
20% above the respective exercise price.
o The holders of the warrants are protected against dilution of their
interests represented by the number of shares of common stock
underlying the warrants upon the occurrence of certain events,
including stock dividends, splits, mergers, reclassifications, and if
we sell shares of common stock below the then book value, other than
sale to employee benefit and stock option plans.
o The holders of the warrants have no right to vote on matters submitted
to our shareholders and have no right to receive dividends. The holders
of the warrants are not entitled to share in our assets in the event of
liquidation, dissolution, or the winding up of our affairs.
o We do not have an exemption from registration with the SEC for the
issuance of the common stock upon the exercise of the warrants. So, in
order for the holder to exercise the warrant, we are required to have a
current, effective registration statement on file with the Commission
and have satisfied the "Blue Sky" registration requirements of the
applicable regulatory authority of the state in which the holder of a
warrant resides. We are required to file posteffective amendments to
our registration statement when subsequent events require such
amendments in order to continue the registration of the shares of
common stock underlying the warrants. Although it is our intention to
both maintain a current prospectus and meet the requirements of the
regulatory authorities of the States of New York and Florida during the
term of the warrants, there can be no assurance that the Company will
be in a position to keep its registration statement current and
effective or to meet the requirements of any state regulatory
authority. It is not our intention to call and/or redeem the
outstanding warrants, if our prospectus is not current or if we are not
in compliance with the requirements of an appropriate state regulatory
authority.
After our offering is successfully completed
Before this offering, there has been no public market for our units, shares of
common stock and Class A and Class B warrants. We cannot assure you that a
public trading market for any of our securities will ever develop or, if one
develops, that it will be maintained.
If we complete our minimum offering, but before the exercise of any of the
warrants, we will have outstanding 6,052,000 shares of common stock. Similarly,
if our maximum offering is completed, we will have 6,102,000 shares of common
stock outstanding. Of the shares outstanding, if our minimum offering is
completed, 50,000 shares (and if the maximum offering is completed, 100,000
shares) will be freely tradeable without restriction under the Securities Act,
if those shares are not later acquired by our "affiliates" (i.e., a person is an
affiliate if he or she directly, or indirectly through one or more
intermediaries controls or is controlled by us, or is under common control with
us).
All of the 6,002,000 shares of common stock presently outstanding are
"restricted securities" as that term is defined in Rule 144 of the Securities
Act. In general, under Rule 144, a person (or persons whose shares must be
aggregated) who has satisfied a one year holding period may, under certain
circumstances, publicly sell within any three (3) month period, a number of
shares which does not exceed the greater of one percent (1%) of the then
outstanding shares of our common stock or the average weekly trading volume of
our common stock during the four calendar weeks before such sale.
Rule 144 also permits, under certain circumstances, the sale of shares of common
stock by a person without any quantity limitation. Future sales under Rule 144
or even the perception of such sales, may have a depressive effect on the market
price of our common stock, should a public market develop for our shares. None
of our current shareholders have already satisfied the one year holding period.
We are unable to predict the effect that sales, or even the threat of sales
under Rule 144 or otherwise, may have on the then prevailing market price of our
shares of common stock.
Our Transfer and Warrant Agent
We have appointed Securities Transfer Corporation with offices at 14160 Dallas
Parkway, Dallas, Texas 75240, as transfer agent for our shares of common stock
and warrant. We have not yet paid the escrow agent's fees. The transfer agent
will be responsible for all record-keeping and administrative functions in
connection with the warrants. A copy of the executed escrow agreement, and the
executed warrant agreement with exhibits attached are filed as a exhibit to our
registration statement on file with the SEC.
Reports to Shareholders
We intend to forward annual reports to our shareholders including audited
financial statement to our investors. We will also forward such interim reports
we deems appropriate.
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Our directors and officers are indemnified as provided by the Nevada Revised
Statutes and our Bylaws. We have been advised that in the opinion of the
Securities and Exchange Commission indemnification for liabilities arising under
the Securities Act 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 is asserted by one of our directors, officers, and
controlling persons in connection with the securities being registered, we will,
unless in the opinion of our legal counsel the matter has been settled by
controlling precedent, submit the question of whether such indemnification is
against public policy to a court of appropriate jurisdiction. We will then be
governed by the court's decision.
ORGANIZATION WITHIN LAST FIVE YEARS
We were incorporated on March 14, 2000 under the laws of the state of Nevada. We
acquired the domain name, www.speedeclaim.com, from an affiliate in August 2000.
DESCRIPTION OF BUSINESS
Incorporated on March 14, 2000, we are a development stage corporation. We are
in the process of developing a comprehensive business to business software
application that will provide the auto glass industry with seamless insurance
claim, parts order processing and instant video-claims approval via the
Internet. Currently, we offer a fully integrated e-commerce claims processing
and management software that reduces the average cost to process an auto glass
insurance claim by as much as 65%.
Our software incorporates all the functionality required to successfully conduct
e-commerce on the Internet from the subscriber's browser. Initially, we hope to
be able to provide our system to over 1600 auto glass retail and wholesale
stores through a proposed joint venture agreement with the IGA and its buying
consortium AmeriGlass Inc.
Approximately eleven million windshields are replaced each year in the United
States alone, at a cost of over $4.8 billion per year and insurance companies
pay a $15 to $50 processing fee per claim to network call centers. The auto
glass industry and the associated auto glass insurers have all expressed a need
for an online claims processing system that is significantly more cost effective
than the existing system.
We have developed a revolutionary Internet based software and database
application that addresses the certain problems inherent in the property and
casualty industry.
Our system utilizes the latest Internet communications technology and online
claims processing databases and is the first user-pay auto glass claims
processing and management software to offer instant, online claims processing
and parts ordering, including live video, directly from the auto glass retail
store for instant claims approval by the insurance companies. Our network is
accessible wherever the Internet is available, there's no download required
because it runs from an Internet browser. (Microsoft(R) Internet Explorer or
Netscape(R)). Each glass vendor will have equal access to the entire glass
replacement market, creating a greater ability for independents to compete with
the large networks.
Unlike current point of sale and parts directory software that only provide
invoicing and reporting features, we provide each area of the industry with a
single, comprehensive Internet application located at our head office. Our
system links the insurance companies to the IGA's AmeriGlass industry buying
consortium, provides "live" video and data services and provides e-commerce
claims processing using our secure network. Our software is based on
`distributed client server principles' providing the auto glass retail and
wholesale stores with free access to the industry's only dynamic, online
comprehensive auto glass and parts database and claims processing system.
Prices, products and availability can be accessed in minutes via a single,
online database.
We believe that our system provides reliable, simultaneous access for 15,000
auto glass retail and wholesale stores (users) and additional users can be added
with the integration of additional interfaces.
Secure Online Payment
We employ proprietary, secure, online payment and credit card processing as well
as comprehensive online customer service, thereby providing a safe and effective
way for retail stores to complete online payment and claims processing
transactions. We will participate in transaction fees from claims processing and
the sale of all glass product originating through our network.
To replace a windshield under our model a simple process for both the auto glass
retail store and the insurance company is followed.
1. The consumer drives directly to his preferred (or nearest) auto glass
store.
2. The auto glass store uses speedeclaim.com to provide the insurance
company with live video approval of the glass insurance claim.
3. The retail store replaces the glass and processes the insurance claim
using the speedeclaim.com system.
4. The insurance company pays the company $7 for processing the claim and
reimburses the retail store via a wire transfer with in 48 hours.
Through a proposed joint venture agreement with the IGA (currently being
negotiated) over 1,600 independent auto glass retail stores will have the
capability to use the speedeclaim.com system within our first year of
operations. Through the power of leading edge technology such as Internet search
engine listings and viral marketing, in conjunction with a comprehensive media
campaign including, e-trade and printed trade journals, we will aggressively
target every potential business-to-business auto glass retail and wholesale
store possible.
Our system will generate revenues based on the following revenue streams:
o Transaction fees from each claim processed of $7.00 per transaction
paid by the insurance company.
o Transaction fees of 1% of each glass order, to a maximum of $2.00 per
transaction, through the AmeriGlass consortium.
o Credit card processing fees of 1.0% of each transaction though the
CyberSource Corporation merchant services.
o Web advertising revenues.
o Web hosting fees from auto glass store web sites.
Our initial target market is the U.S. auto glass retail and wholesale stores as
well as the auto glass insurance companies. We will provide the auto glass
stores with free access to our system and each insurance company will pay us
$7.00 to process each claim.
Industry Overview
The Internet is a rapidly growing global computer network for collecting and
exchanging information, communicating, and conducting business. The growth of
this computer network is driven by inexpensive web access, inexpensive website
production costs, and businesses wishing to capitalize on the potential revenues
which may result from effective advertising.
The property and casualty insurance industry is experiencing runaway claims
processing and litigation costs. Industry research indicates that the property
and casualty insurance industry spends over $70 billion annually on inefficient
claims processing techniques of which $6 billion is related to auto glass
claims. The Federation of Insurance and Corporate Counsel has determined that
Internet technology has matured to the point where `it is time to determine and
establish ways and means of adopting and leveraging Internet standards and
technologies to address directly the problems of claims processing, litigation
inefficiencies and runaway costs'.
Frederick Jennings, (Harvard economist) recently identified this problem as a
result of "the networks developing their programs based on a faulty economic
model of market power and not efficiency". In the IGA January/February 2000
newsletter, IGA President Donovan Trana also stated "Over the past 8-plus years,
administrative costs have risen dramatically in all phases of the glass handling
process. These costs have eroded the glass dealer's profit while increasing
complexity and decreasing efficiency. The panacea of a streamlined glass-claims
handling system has actually evolved into a bloated, confusing, inefficient and
costly system. The insurance companies are not truly saving any money, and there
hasn't been a profitable network developed yet"!
At the present time the independent glass stores have no option but to purchase
costly point of sales software applications from dominant industry suppliers.
And as a result their market share and profits continue to decrease as they
compete against large networks and "claim steering" tactics.
As an example, to replace a windshield under the current auto glass industry
model, a cumbersome process for both the auto glass retail store and the
insurance company must be followed.
1. The consumer must first contact his insurance agent to notify them of
his need to replace his windshield.
2. The agent then passes the consumer to a call center.
3. The consumer completes a telephone insurance claim form and is directed
to an auto glass retail store by the call center.
4. The auto glass store schedules the consumer and checks available glass
inventory using a monopolized parts system that every auto glass
wholesaler and manufacture must use.
5. The consumer pays the deductible amount (to the retail store) and his
windshield is replaced.
6. The retail store incurs all expenses required to replace the
windshield.
7. The retail store completes the insurance claim form and either faxes or
mails it to a designated call center for processing.
8. The call center processes the insurance claim for a $15 - $50
processing fee paid by the insurance company.
9. The insurance company mails payment to the retail store.
The consumer's windshield is replaced in a few days from the date he first
contacted his insurance agent. However the insurance company may not reimburse
the retail store for as much 90 days after the windshield was replaced. This is
due to the inherent inefficiencies of using call centers to process over $6
billion in auto glass insurance claims per year with a paper trail that involves
at least 4 different parties before the retail store gets paid.
Our target market is the auto glass wholesale and retail store and the
associated auto glass insurers that want to process insurance claims
effortlessly, at significantly reduced rates and with immediate payment.
Approximately 11 million windshields are replaced each year in the United States
alone, at a cost of over $4.8 billion per year, however, our system is capable
of servicing the worldwide insurance glass claims processing requirements.
We have identified a specific market on which to concentrate its sales
activities. The short-term plan is to provide our system to the members of the
IGA free of charge across North America. The IGA currently has 1,600 independent
glass store members, and with the introduction of our system as the IGA's online
billing and buying group system of choice, the goal is to increase membership to
2,500 during the next two years.
For these businesses, our system is expected to provide the only turn-key
solution for real time claims processing and parts ordering via the Internet.
Our target market will also include the auto glass wholesale level of
multi-tiered sales organizations. These organizations will be able to energize
their wholesale level sales by getting online and providing more complete
product information, delivered more effectively and less expensively, to their
internal and external customers. An extensive public relations campaign,
conducted by one of the world's largest public relations organizations and
controlled by our in-house experts, will manage this assignment.
Employing our business-to-business system will allow these stores to process
claims and purchase product with greater ease and efficiency and enable them to
achieve a broader cost reduction. And our management tools will make there store
much more effective. Most of these businesses already know that the Internet can
provide up-to-the-minute product cost and availability to information from
supplier channels while providing marketing information to their customers.
Every business has a product that current supplier channels fail to promote
properly or whose reach is limited by the current distribution network. With our
system, the Internet will be the primary medium by which these businesses will
be able to grow their revenue base and lower their sales and customer service
costs.
If the glass product can be purchased online, over the telephone or through a
catalog (if the product is too complicated for telephone sales), we hope to be
able to provide the answer.
We hope to strengthen customer loyalty because online interaction can actually
result in closer ties to a business' customers, based on a deeper understanding
of their needs and a potential for greater frequency of contact. We hope to
provide faster time-to-market and allows a quicker response time to market
changes.
The Internet supply channel is entirely in the control of the purchasing company
and it can literally be changed as rapidly and as dramatically as needed and in
real-time. And because the channel is a virtual one, all of these applications
can be implemented without having to re-train personnel.
Business-to-Business Overview
By the end of 1999, Cisco Systems reported $1 billion per year in on-line
orders. Similarly, PC Warehouse is generating $3 million in sales per day from
its Website. And Dell Computer reports $1 million in sales per day.
Business-to-business commerce is thriving on the Internet. The successes are
real and the returns are measurable. Companies are reinventing relationships
with their customers and making it easier for customers to do business by
reducing the cost of doing business via their existing channels. Their field
sales people, channel partners and large account customers can make inquiries
and post orders, filling an important need in a company's supply chain
management strategy. We will use uses the Internet to make more complete product
information available to an infinitely broader audience.
Manufacturers will use the web to compete directly with their existing
bricks-and-mortar distribution channels.
Distribution companies with large inventories can use speedeclaim.com to present
a depth of product not practical in paper-based catalogs. These companies
realize that intranet/extranet based commerce is a good first step to full
retail e-commerce whenever they, and their customers, are ready. Large
wholesalers can use speedeclaim.com to offer online ordering to their business
accounts, reducing costs while increasing service levels and building customer
loyalty.
The Internet has made room for an entirely new class of business-to-business
product sales. Virtual companies are springing up to service their new customer
types whose primary commonality is their connection to the web. Traditional
notions of "business-to-business trading channel" are being dramatically revised
by new ways of identifying and targeting customers based on their associations,
affiliations, interests, buying habits and demographics.
The most obvious characteristic of a virtual store is its lack of a physical
presence in the industry it serves (its lack of bricks and mortar). The
revolutionary aspects are the ability to reach target customers anywhere, such
as the auto glass retail store as well as the insurance companies, and to
identify those customers based on characteristics that a business is
specifically set up to serve.
We are ideally positioned to service the auto glass insurance industry.
Wholesale businesses will typically offer a large depth of product and
speedeclaim.com technology was designed, from the ground up, eliminating the
wholesaler's need for additional computer systems and information technology
departments by out-sourcing their technology needs to us.
We are taking the following specific actions necessary to achieve our business
goals.
Our objective is to become one of the Internet's leading Internet applications
supplier for the auto glass industry in the following areas:
o Claims processing;
o Parts ordering;
o Real time (live) claims approval; and
o Online dynamic auto glass parts identification and pricing database.
o By the first quarter of 2001, we intend to complete the development of
our system and launch our website. We anticipate that the majority of
the more than 1,600 IGA members will start utilizing our system to
process their insurance claims, and as more retail stores come online,
we anticipate a proportional number of insurers will also endorse and
use our system.
o In the first quarter of 2001, we intend to increase current staffing
levels and office facilities to service the initial 100 stores and to
manage successfully the anticipated growth to over 1,600 stores within
the first twelve (12) months of operation. We expect to retain Exodus
Communications, Inc. and Cybersource as the application service
provider and credit card processing center, respectively.
o In the fourth quarter of 2001, we also intend to launch a national
strategic marketing and media plan.
When will our development stage be completed?
We believe that before the first quarter of 2001 we will have developed a fully
operational website and network for our potential customers.
Our objective and strategy
Our objective is to be a leading Internet applications supplier for the auto
glass industry in the following areas:
o Claims processing;
o Parts ordering;
o Real time (live) claims approval; and
o Online dynamic auto glass parts identification and pricing database.
To achieve these objectives, we are pursuing the following strategies:
1. To broadly establish the premise that Internet commerce requires much
more than payment processing. We believe that the Internet significantly alters
the business environment for companies of all sizes and within every industry.
In order for Internet commerce strategies to be successful, we hope to provide a
comprehensive business application with significantly more functionality than
simple payment processing. Today, the successful leaders of Internet commerce
offer comprehensive, on-line order management, which includes the capability to
capture orders, process orders (authenticating buyers, determining form of
payment, processing payment and addressing fulfillment) and service orders
online (order and shipment status, transaction statements and customer service).
2. To provide comprehensive solutions, utilizing distributed server
application software and best-in-class services. We believe that the market for
Internet commerce solutions will move inexorably in favor of comprehensive
distributed server applications. Such solutions usually offer a faster
time-to-market and therefore, inherently provide a faster time-to-profitability.
As in any maturing market, the natural evolution is formal and customized to
off-the-shelf solutions. A complete family of services will be a critical
component of the ultimate success for Internet commerce customers. Our product
and service offerings are marketplace-driven and reflect the best practices of
customers who have been at the forefront of Internet commerce.
3. To provide robust, end-to-end solutions in other key markets. We have
recognized that, in certain markets such as manufacturing and distribution, its
competitive position is greatly enhanced by offering a robust, end-to-end
solution. By leveraging our expertise, we have focused its financial and
technical resources primarily on solutions for the auto glass
business-to-business e-commerce. This focus has enabled us to develop a
substantial knowledge base.
This extensive experience in the marketplace is an asset that we intend to
exploit in a number of ways including transferring this knowledge base into
future product releases through its continued development of our products and by
incorporating the best practices and lessons learned from the marketplace.
We believe that the Internet opens up a global market to businesses of all sizes
located anywhere in the world. Consequently, the company will invest
significantly in an infrastructure designed to offer comprehensive services
outside the United States. For example, we may consider operating a
fully-staffed Technical Support and Professional Services center in the United
Kingdom. The company will establish partnerships with several of the leading
auto glass associations around the world.
We hope to utilize the marketing channels of our proposed joint venture partner,
the IGA to ensure that our system is in the majority of auto glass retail stores
across North America within the next 5 years. The arrangement with our joint
venture partner calls for a share of revenues generated from claims processing
and part ordering whereby we will pay the IGA $1.00 for every transaction.
Additionally, we will utilize web-crawler technology to update the online glass
database to create the single largest database of it's kind available online. As
well, a comprehensive media campaign including, Viral Marketing, e-Trade and
printed trade journals will aggressively target every potential
business-to-business customer possible.
Research and Development Activities
Since its inception, the founders have spent approximately 2 years in product
development, defined in its operational and marketing requirements and completed
the third-stage product development. The founders also established operational
databases which demonstrate all of the major features and benefits of our
system. The executive staff was also hired during this period and a joint
venture agreement was entered into with the IGA.
Our equipment and primary agreements
We do not currently have any equipment leases or insurance policies.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the
financial statements and notes thereto appearing elsewhere in this prospectus.
This discussion contains forward looking statements that involve risks and
uncertainties.
Operations
We are in the development stage and have not generated revenues from our
inception to June 30, 2000 having incurred primarily only startup and
organizational expenses. Accordingly, our financial results, from inception to
June 30, 2000, are not meaningful as an indication of future operations.
During the next 2 calendar year quarters, we expect to purchase hardware and
complete the software development required to finalize our system, and to
operate our web servers and email servers.
We anticipate increasing our current staffing levels and office facilities to
service the initial 100 stores in the first quarter of 2001, and successfully
managing the anticipated growth to over 1,600 stores within the first 12 months
of operations.
Creative development of advertising, formulation of Internet and paid media
strategies and the production of physical materials will also be undertaken.
Parallel development of sales and marketing materials will be undertaken in line
with the established strategies.
We hope to launch a national strategic marketing and media plan during 2001. We
anticipate increasing proportionately all areas of the Company's operations,
including hardware, speedeclaim.com development, employees and facilities
required to successfully manage the increase in retail glass stores using the
speedeclaim.com system.
For the period from our date of inception through June 30, 2000, our activities
related primarily to the recruitment of the executive staff and the
establishment of its organizational and technical infrastructure. As our
business develops, we anticipate that revenues will be derived mainly from the
processing of auto glass insurance claims over our network.
The expected significant costs related to our operation will be related to:
o capital expenditures for hardware and network infrastructure;
o program development;
o sales and marketing;
o initial advertising; and
o operating costs.
Our liquidity and capital resources
From inception through June 30, 2000, we received $113,450 in net proceeds from
investors and our founders. As of June 30, 2000, we had approximately $6,783 in
cash and cash equivalents. To date, we show negative cash flows. We expect
losses from operations and negative cash flow to continue for the foreseeable
future. If our revenues, and our spending levels are not adjusted accordingly,
we may not generate sufficient revenues to achieve profitability. Even if we
achieve profitability, we may not sustain or increase such profitability on a
quarterly or annual basis in the future. We hope that the net proceeds from the
maximum offering, together with available funds, will be sufficient to meet our
anticipated needs for at least 6 months. We may need to raise additional funds
in the future in order to fund more rapid expansion, to develop new or enhanced
services, to respond to competitive pressures or to acquire complementary
businesses, technologies or services. The need to raise additional funds may
arise especially if we only complete the minimum offering or if significantly
less than the maximum offering is completed. We cannot be certain that any
required additional financing will be available on terms favorable to us. If
additional funds are raised by the issuance of our equity securities, such as
through the exercise of the redeemable warrants, then existing stockholders may
experience dilution of their ownership interest. If additional funds are raised
by our issuance of debt instruments, we may be subject to certain limitations on
our operations. If adequate funds are not available or not available on
acceptable terms, we may be unable to fund our expansion, take advantage of
acquisition opportunities, develop or enhance services or respond to competitive
pressures.
We are not aware of any Year 2000 compliance problems relating to our own
software or systems.
We are not currently aware of any Year 2000 compliance problems relating to our
software or systems that would have a material adverse effect on our business,
results of operations and financial condition, without taking into account our
efforts to avoid or fix any problems. There can be no assurance that we will not
discover Year 2000 compliance problems in our software that will require
substantial revisions or replacements. In addition, there can be no assurance
that third party software, hardware, or services incorporated into our systems
will not need to be revised or replaced, which could be time consuming and
expensive. Our failure to fix our software or to fix or replace third party
software, hardware or services on a timely basis could result in lost revenues,
increased operating costs and other business interruptions, any of which could
have a material adverse effect on our business, results of operations and
financial condition. Moreover, failure to adequately address Year 2000
compliance issues in our software and systems could result in claims of
mismanagement, misrepresentation or breach of contract and related litigation,
which could be costly and time consuming to defend. In addition, there can be no
assurance that governmental agencies, utility companies, Internet access
companies, third party service providers and others outside our control will be
Year 2000 compliant. The failure by such entities to be Year 2000 compliant
could result in a systematic failure beyond our control, such as prolonged
Internet, telecommunications or electrical failure. That type of failure could
prevent us from delivering our services, decrease the use of the Internet or
prevent users from accessing our websites any of which would have a material
adverse effect on our business, results of operations and financial condition.
DESCRIPTION OF PROPERTY
We do not own any real property. All costs described in this section are stated
in U.S. dollars as converted from Canadian dollars. Accordingly, the costs may
vary to some degree with the currency exchange rate. Our offices are
approximately 1,000 square feet located at 1066 West Hastings Street, Vancouver,
B.C., Canada U6E 2X3, and 2,000 square feet located in St. Petersburg, Russia.
The Vancouver office is leased on a monthly basis and the monthly rent is
approximately $600. The St. Petersburg office is leased on a monthly basis and
the monthly rent is $600. We believe that the facilities will be adequate for
the foreseeable future.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
We have employment agreements with certain key employees and the participation
of those employees in the 2000 Stock Option Plan. In addition, we owe monies to
two companies for computer software research and development costs which these
companies incurred on our behalf. These companies are owned by our officers and
directors. Sentac Corporation, which is affiliated with David Whyte, our
President and Chairman, is owed $184,878, and Dennis Rohel, our Chief Knowledge
Officer and Secretary, is owed $180,938.
In addition, we owe $70,800 to David Whyte for an advance he made to us which is
non-interest bearing and has no fixed terms for repayment.
Other than as described above, none of the following parties has, since our date
of incorporation, had any material interest, direct or indirect, in any
transaction with us or in any presently proposed transaction that has or will
materially affect us:
(1) Any of our directors or officers;
(2) Any person proposed as a nominee for election as a director;
(3) Any person who beneficially owns, directly or indirectly, shares carrying
more than 10% of the voting rights attached to our outstanding shares of common
stock; (4) Any of our promoters; and (5) Any relative or spouse of any of the
foregoing persons who has the same house as such person.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
No Present Public Market
There is presently no public market for our common stock. We anticipate applying
for trading of our stock with the Over the Counter Bulletin Board upon the
effectiveness of the registration statement of which this prospectus forms a
part. However, we can provide no assurance that our shares will be traded on the
OTC Bulletin Board or if traded, that a public market will materialize.
Holders of Our Common Stock
As of the date of this registration statement, we had 7 shareholders.
Dividends
There are no restrictions in our articles of incorporation or bylaws that
restrict us from declaring dividends. The Nevada Revised Statutes, however, do
prohibit us from declaring dividends where, after giving effect to the
distribution of the dividend:
(1) we would not be able to pay our debts as they become due in the usual
course of business; or
(2) our total assets would be less than the sum of our total liabilities,
plus the amount that would be needed to satisfy the rights of
shareholders who have preferential rights superior to those receiving
the distribution.
We have not declared any dividends. We do not plan to declare any dividends in
the foreseeable future.
EXECUTIVE COMPENSATION
The following table sets forth information with respect to compensation we paid
for the period beginning on our date of inception and ending on June 30, 2000
for services of the executive officers. We have not paid any executive officer
in excess of $100,000 (including salaries and benefits) during the period ending
July 31, 2000. A portion of the net proceeds of the offering herein will be used
to pay at least a portion of officers' salaries.
<PAGE>
Summary Compensation Table (please add bracketed information)
<TABLE>
<CAPTION>
---------------------------- ---------- ---------------- -------------------------------------------------------
Name and Principal Year Annual
Position(s) Compensation Long Term Compensation
(a) (b)
---------------------------- ---------- ---------------- -------------------------------------------------------
---------------------------- ---------- ---------------- ------------------- -----------------------------------
Salary
($) Awards Payouts
(c)
---------------------------- ---------- ---------------- ------------------- -----------------------------------
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
Securities
Underlying LTIP All Other
Options/ SARs Payouts Compensation
(#) ($) ($)
(g) (h) (i)
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
<S> <C> <C> <C> <C> <C>
David Whyte 2000 -0-* 250,000 -0- -0-
President and Chairman
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
Alastair King
Chief Executive Officer
Principal Financial
Officer and Controller 2000 -0-* 250,000 -0- -0-
and Director
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
Dennis Rohel
Chief Knowledge Officer
and Secretary 2000 -0-* 250,000 -0- -0-
---------------------------- ---------- ---------------- ------------------- ------------------ ----------------
</TABLE>
* No amounts have been paid to date. Upon consummation of the offering,
accrued salaries will be paid to Messrs. Whyte, King and Rohel.
<TABLE>
<CAPTION>
Option/SAR Grants In Year 2000
Percent of Total
Number of Securities Options/SARs Granted
Underlying Options/ to Employees in Exercise or Base Expiration
Name SARs Granted (#) Fiscal Year Price (#1sh) Date
(a) (b) (c) (d) (e)
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
<S> <C> <C> <C> <C> <C>
David Whyte 250,000 25% $1.00 March 10, 2005
Alastair King 250,000 25% $1.00 March 10, 2005
Dennis Rohel 250,000 25% $1.00 March 10, 2005
</TABLE>
Messrs. Whyte, as an officer and director of the Company, and Rohel, as an
officer of the Company, were each issued 2,000,000 shares of the common stock,
respectively, and Mr. King was issued 300,000 shares of common stock, for
nominal consideration (i.e. $.0001 per share).
Each of Messers. Whyte, King and Rohel have executed Employment Agreements which
each provide a 5 year term of employment (ending on January 3, 2005). Each of
the Employment Agreements provides an annual salary of $150,000 and options to
purchase 250,000 shares of the Company's common stock granted pursuant to the
2000 Stock Option Plan. Each Agreement provides for an annual bonus related to
the Company's level of gross sales as follows:
o If gross sales are greater than or equal to $3,000,000 but less than
$5,000,000, the bonus payable shall be equal to 1% of gross sales in
excess of $3,000,000;
o If gross sales are greater than or equal to $5,000,000, the bonus shall
be equal to (x) 0.5% of the amount gross sales exceeds $5,000,000 plus
(y) $50,000.
Each Employment Agreement provides that the Company shall have the right to
terminate each employee for "cause" and in such case the Company shall only be
entitled to pay to such employee his accrued salary up to the date of
termination plus any expenses incurred by the employee.
If there is a change in control of the Company, and the employee is terminated
in connection with such transaction, then the employee shall be entitled to
receive (i) any unpaid accrued salary as of the date of termination, (ii)
reimbursement for any expenses incurred up to the date of termination, (iii) a
pro rata amount of such employee's bonus determined pursuant to the Agreement,
and (iv) 2 years of such employee's salary if and only if such employee is not
offered continued employment under terms substantially similar to his prior
position before the change in control.
Each Employment Agreement provides for a 1 year non-compete period after the
termination of employment and a 2 year non-solicitation provision after its
termination and a standard confidentiality provision.
Our Board of Directors has approved and adopted the 2000 Stock Option Plan
pursuant to which the Board is authorized to grant to our employees stock
options to purchase common stock. Each of Messrs. Whyte, King and Rohel have
been granted 250,000 pursuant to the 2000 Stock Option Plan. The exercise price
for each option is $1.00 per share and the options vest upon our listing on the
NASD Bulletin Board. These options expire on the fifth anniversary of the date
of grant (March 10, 2000).
We do not compensate Directors.
We do not pay our directors any remuneration for their service. However, they
are reimbursed for their out-of-pocket expenses associated with meetings of the
Board of Directors. We do not maintain a stock option plan for Directors.
<PAGE>
FINANCIAL STATEMENTS
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
AUDITED FINANCIAL STATEMENTS
JUNE 30, 2000
INDEX
AUDITORS REPORT
BALANCE SHEET
STATEMENT OF OPERATIONS
STATEMENT OF STOCKHOLDERS' EQUITY
STATEMENT OF CASH FLOWS
NOTES TO FINANCIAL STATEMENTS
<PAGE>
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
AS OF JUNE 30, 2000
ASSETS
(Audited)
2000
$
(US Funds)
CURRENT ASSETS
Cash 6,783
Share subscriptions receivable 525
--------
--------
7,308
--------
CAPITAL ASSETS (Note 1b) 9,786
--------
17,094
--------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accruals 33,841
--------
33,841
--------
DUE TO RELATED PARTIES (Note 2) 365,816
--------
ADVANCES FROM SHAREHOLDERS (Note 3) 70,800
--------
SHARE CAPITAL (Note 4) 117,055
--------
RETAINED EARNINGS (DEFICIT)
Opening balance --
Net loss for the period (570,418)
--------
Ending balance (570,418)
--------
17,094
--------
Approved by the Director:
____________________________ Director
(see accompanying notes)
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE PERIOD ENDED JUNE 30, 2000
(Audited)
2000
$
(US Funds)
REVENUE --
--------
EXPENSES
Accounting and legal 29,476
Advertising and promotion 11,831
Automotive and travel 37,066
Bank charges and interest 7,173
Computer software research and development 444,210
Consulting 25,000
Office 5,561
Rent and utilities 5,963
Subcontracts 1,360
Telephone 2,778
--------
570,418
--------
NET LOSS FOR THE PERIOD (570,418)
--------
(see accompanying notes)
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD ENDED JUNE 30, 2000
(Audited)
<TABLE>
<CAPTION>
Common Stock
-----------------------------
Shares Amount Additional Deficit Total
$ Paid-in Accumulated Stockholders'
(US Funds) Capital During the Equity
Development (Deficit)
Stage
----------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Issue of common stock on private
placement for cash
- in June, 2000 for $0.001 per share 4,000,000 4,000 - - 4,000
- remaining in June, 2000 2,002,000 113,055 - - 113,055
Net loss for the period - - - (570,418) (570,418)
----------------------------------------------------------------------------
Balance, June 30, 1999 6,002,000 117,055 - (570,418) (453,363)
----------------------------------------------------------------------------
</TABLE>
(see accompanying notes)
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE PERIOD ENDED JUNE 30, 2000
(Audited)
CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES
Net loss from operations ................ (570,418) 3,997
Add: non-cash items
Amortization ............................ -- 409
-------- --------
(570,418) 4,406
Changes in working capital items
Share subscriptions receivable .......... (525) 3,928
Accounts payable and accruals ........... 33,841 9,603
-------- --------
(537,102) 17,937
-------- --------
INVESTING ACTIVITIES
Purchase capital assets ................. (9,786)
--------
--------
(9,786)
--------
FINANCING ACTIVITIES
Due to related parties .................. 365,816
Advances from shareholders .............. 70,800
Issuance of share capital ............... 117,055 1,064
-------- --------
553,671 1,064
-------- --------
NET INCREASE (DECREASE) IN CASH FOR THE YEAR 6,783 19,001
CASH - BEGINNING OF YEAR ................... -- 6,665
-------- --------
CASH - END OF YEAR ......................... 6,783 25,666
-------- --------
(see accompanying notes)
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2000
(Audited)
The company's main business activity is developing software for automobile glass
insurance claims and parts order processing on the internet.
NOTE 1...SIGNIFICANT ACCOUNTING POLICIES
a) Incorporation
The company was incorporated in the State of Nevada on March 14, 2000, file
number 7045-2000.
b) Amortization
Capital assets are recorded at cost and are amortized as follows:
Computer 30% declining balance
Additions during the year are amortized at one half their
normal rate and no amortization is taken in the year of
disposal.
NOTE 2 DUE TO/FROM RELATED PARTIES
Unpaid amounts due to/from related parties for computer software research and
development are recorded at cost, unsecured, non-interest bearing and have no
fixed terms for repayment as follows:
Sentac Corporation, David Whyte $ 184,878
Wholeo Corporation, Dennis Rohel 180,938
-----------
$ 365,816
NOTE 3 SHAREHOLDERS ADVANCES
The advances due to shareholders are non-interest bearing and have no fixed
terms for repayment.
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2000
(Audited)
NOTE 4 SHARE CAPITAL
Share capital consists of:
Authorized: 50,000,000 shares, with a par value of (one-tenth
of one cent) $.001 per share (US Funds).
As at June, 2000 there were 4,000,000 shares issued to officers and directors of
the company as follows:
<TABLE>
<CAPTION>
No. of Shares Price Total $
/share
<S> <C> <C> <C>
David Whyte, President 2,000,000 .001 2,000
Dennis Rohel, Secretary 2,000,000 .001 2,000
--------- ---------
4,000,000 4,000
</TABLE>
The remaining shares were issued as follows:
No. of Shares Total $
Art Beroff ............... 302,893 30
Carol Beroff, in trust for
David Beroff ............. 101,369 10
Carol Beroff, in trust for
Ilana Beroff ............. 101,369 10
Elaine and Fred Beroff ... 101,369 10
Alastair King ............ 300,000 25
Felicia Cartier .......... 200,000 200
John Gardner ............. 187,500 37,500
David Coolidge ........... 187,500 37,500
Kevin Malone ............. 125,000 12,500
Gavin Kirk ............... 125,000 25,000
Victor Cardenas .......... 25,000 25
Julia Karmanova .......... 92,000 92
Yuri Asheshov ............ 92,000 92
Svetlana Solova .......... 36,000 36
Bill Dobson .............. 25,000 25
--------- ---------
2,002,000 113,055
========= =========
<PAGE>
SPEEDECLAIM.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2000
(Audited)
NOTE 5 EXCHANGE RATE
During the period ending June 30, 2000, deferred costs were paid in Canadian
funds. This amount has been converted to US currency as follows $1.46 Canadian
funds equals $1.00 US funds or $.68 US funds equals $1.00 Canadian funds.
NOTE 6 SUBSEQUENT EVENTS
Also subsequent to the date of these financial statements, the company
anticipates 3 or 4 private investors will subscribe to 300,000 common shares at
a per share price of $1 on or before August 31, 2000.
<PAGE>
AUDITOR'S REPORT
To the Shareholders of
SPEEDECLAIM.COM, INC.
I have audited the statement of financial position of Speedeclaim.com, Inc. as
at June 30, 2000 and "Schedule A" - Deferred Costs for the period then ended.
These financial statements are the responsibility of the company's management.
My responsibility is to express an opinion on these financial statements based
on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I plan and perform an audit to obtain reasonable
assurance whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amount 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.
In my opinion, these financial statements present fairly, in all material
respects, the financial position of the company as at June 30, 2000 and the
deferred costs for the period then ended in accordance with generally accepted
accounting principles.
Vancouver, B.C. Maude & Associates
August 24, 2000 Certified General Accountant
<PAGE>
CHANGES IN AND DISAGREEMENTS WITH
ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
There have been no changes in or disagreements with the Company's accountants
since the formation of the Company required to be disclosed pursuant to Item 304
of Regulation S-B.
LEGAL OPINION
The legality of the issuance of the securities offered pursuant to this
Prospectus will be passed upon for us by Herrick, Feinstein LLP, 2 Park Avenue,
New York, New York 10016.
EXPERTS
Our financial statements included in the Prospectus, to the extent and for the
period indicated in their report with respect thereto, have been audited by
Maude & Associates, independent certified public accountants, as stated in their
report appearing elsewhere herein, and are included in reliance upon such report
given upon the authority of that firm as experts in accounting and auditing.
HOW YOU CAN GET MORE INFORMATION ABOUT US
We do not presently file reports or other information with the SEC. However,
following completion of the minimum offering, we will distribute to stockholders
at fiscal year end on each December 31st, annual reports containing financial
statements that have been audited and reported upon, with an opinion expressed
by an independent public accountant and other information as may be required by
law. In this regard, upon the completion of the minimum offering herein, we will
be subject to the informational requirements of the Securities Exchange Act and
are required to file reports, proxy statements and other information with the
SEC. The reports, proxy statements and other information that we will file will
be available for inspection and copying (for a specified fee) at the SEC's
public reference room located at Room 1024, 450 Fifth Street, NW, Washington,
D.C. 20549, and the public reference facilities in the SEC's Northeast Regional
Office, 7 World Trade Center, New York, New York 10048; and its Midwest Regional
Office, Citicorp Center, 500 West Madison Street, Suite 2400, Chicago, Illinois
60661. Copies of such material may also be obtained at prescribed rates by
writing to the SEC's Public Reference Section, 450 Fifth Street, NW, Washington,
D.C. 20549 upon payment of the fees prescribed by the SEC. Please call the SEC
at 1-800-SEC-0330 for more information on the operation of its Public reference
Rooms. The SEC also maintains a Web site that contains reports, proxy and
information statements and other materials that are filed through the SEC's
Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. This Web Site
can be accessed at http://www.sec.gov.
<PAGE>
SPEEDECLAIM.COM
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24. Indemnification of Directors and Officers
The Company is incorporated under the laws of the State of
Nevada. As authorized by Section 78.751 of the Nevada General
Corporation law, the Company may indemnify its officers and
directors against expenses incurred by such persons in
connection with any threatened, pending or completed action,
suitor proceedings, whether civil, criminal administrative or
investigative, involving such persons in their capacities as
officers and directors, so long as such persons acted in good
faith and in a manner which they reasonably believed to be in
the best interests of the Company. If the legal proceeding,
however, is by or in the right of the Company, the director or
officer may not be indemnified in respect of any claim, issue
or matter as to which he is adjudged to be liable for
negligence or misconduct in the performance of his duty to the
Company unless a court determines otherwise.
Under Nevada Law, corporations may also purchase and maintain
insurance or make other financial arrangements on behalf of
any person who is or was a director or officer (or is serving
at the request of the corporation as a director or officer of
another corporation) for any liability asserted against such
person and any expenses incurred by him in his capacity as a
director or officer. These financial arrangements may include
trust funds, self insurance programs, guarantees and insurance
policies. The Eighth Article of the Articles of Incorporation,
as amended, provides that no director, or officer of the
Company shall be personally liable to the Company or any of
its stockholders for damages for breach of fiduciary duty as a
director or officer involving any act or omission of any such
director; provided, however, that the foregoing provision
shall not eliminate or limit the liability of a director or
officer (i) for acts or omissions which involve intentional
misconduct, fraud or knowing violation of law, (ii) the
payment of dividends in violation of Section 78.300 of the
Nevada Revised Statutes, (iii) any breach of the director's or
officer's duty of loyalty to the Company or its stockholders,
or (iv) for any transaction from which the director derived
any improper personal benefit.
Item 25. Other Expenses of Issuance and Distribution
The expenses to be paid by the Registrant in connection with
the issuance and distribution of the securities being
registered, under both the minimum and maximum offerings, are
estimated to be as follows:
<TABLE>
<S> <C>
SEC Registration Fee $ 555.00
Printing and Engraving Expenses $ 500.00
Accounting Fees and Expenses $ 5,000.00
Legal Fees ($25,000) and Expenses $30,000.00
Blue Sky Expenses, and other Fees
Registrar and Warrant and Transfer $ 2,500.00
Agent Fees $ 2,500.00
Miscellaneous $ 5,000.00
Total $51,055.00
</TABLE>
Item 26. Recent Sales of Unregistered Securities
During the past three years, the Registrant sold securities
which were not registered under the Securities Act, as
follows:
<TABLE>
<CAPTION>
Date Number of Shares
Shareholders of Issuance of Common Stock Consideration
------------ ----------- --------------- -------------
<S> <C> <C> <C>
David Whyte 2,000,000 $ 2,000
Dennis Rohel 2,000,000 $ 2,000
Art Beroff 302,893 $ 30
Alastair King 300,000 $ 25
Felicia Cartier 195,000 $ 200
John Gardner 187,500 $37,500
David Coolidge 187,500 $37,500
Kevin Malone 125,000 $12,500
Gavin Kirk 125,000 $25,000
Victor Cardenas 25,000 $ 25
Carol Beroff in trust for 101,369 $ 10
Carol Beroff, in trust for 101,369 $ 10
Elaine and Fred Beroff 101,369 $ 10
Julia Karmanova 92,000 $ 92
Yuri Asheshov 92,000 $ 92
Svetlana Solova 36,000 $ 36
Bill Dobson 25,000 $ 25
Sandra Whyte 5,000 $ 5,000
</TABLE>
The foregoing transactions are exempt from the registration
provisions of the Securities Act of 1933, as amended, by
reason of Section 4(2) thereof as constituting private
transactions not involving a public offering. A restricted
legend has been placed on all shares issued in these
transactions and the registrant's transfer agent will be given
the appropriate stop transfer instructions. The offers and
sales should not be integrated with the public offering herein
since such sales and those sales to be made to the public (a)
are not part of a single plan of financing; (b) have not and
will not be made at or about the same time; and (c) have not
and will not be made for the same general purpose.
Furthermore, said sales should not be integrated in reliance
upon the safe harbor interpretation of Rule 152 under which it
is the view of the staff of the U.S. Securities and Exchange
Commission that the filing of a registration statement
following an offering otherwise exempt under Section 4(2) does
not vitiate the exemption under that Section.
Item 27. Exhibits
Exhibit No. Description
<TABLE>
<S> <C>
3.1 Amendment to the Certificate of Incorporation of Registrant.
3.2 By-Laws of Registrant.
4.1 Specimen Common Stock Certificate.
4.2 Specimen of Class A redeemable common stock purchase Warrant.
4.3 Specimen of Class B redeemable common stock purchase Warrant.
4.4 Form of Warrant Agreement with the Warrant Agent.
5.1. Opinion of Herrick, Feinstein LLP.
10.1 Form of Escrow Agreement.
24.2 Consent of Maude & Associates.
24.3 Consent of Herrick, Feinstein LLP (included in Exhibit 5.1).
27.1 Financial Data Schedule.
</TABLE>
Item 28. Undertakings
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 SEC such indemnification is
against public policy as expressed in the 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 Act and will be governed by the final adjudication of such
issue.
The undersigned Registrant hereby undertakes:
(A) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement to:
(1) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(2) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in aggregate, represent a fundamental change
in the information set forth in the Registration Statement;
(3) To include any material information with respect
to the plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement.
(B) That for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall
be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such
securities at the time shall be deemed to be the initial bona
fide offering thereof.
(C) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to our directors, officers and
controlling persons pursuant to the provisions above, or
otherwise, we have 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 us of expenses incurred or paid by one of our
directors, officers or controlling persons in the successful
defense of any action, suit or proceeding, is asserted by one
of our directors, officers or controlling persons in
connection with the securities being registered, we 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 is against public policy as expressed in the
Securities Act, and we will be governed by the final
adjudication of such issue.
<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, Province of British Columbia, Canada, on
the 29th day of August, 2000.
SPEEDECLAIM.COM, INC.
By: /s/ David Whyte
---------------------------
Name: David Whyte
Title: President
By: /s/ Alastair King
---------------------------
Name: Alastair King
Title: Chief Executive Officer
POWER OF ATTORNEY
ALL MEN BY THESE PRESENT, that each person whose signature appears below
constitutes and appoints Alastair King, his true and lawful attorney-in-fact and
agent, with full power of substitution and re-substitution, for him and in his
name, place and stead, in any and all capacities, to sign any and all pre- and
post-effective amendments to this registration statement, and to file the same
with all exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite or necessary to be done in or about the premises,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any one
of them, or their or his substitutes, may lawfully do or cause to be done by
virtue hereof.
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.
SPEEDECLAIM.COM, INC.
By: /s/ David Whyte August 31, 2000
-----------------------
David Whyte
President and Director
By: /s/ Alastair King August 31, 2000
-----------------------
Alastair King
Chief Executive Officer, Principal
Financial Officer and Controller,
and Director
<PAGE>
UNANIMOUS WRITTEN CONSENT AND ACTION OF
THE STOCKHOLDERS AND BOARD OF DIRECTORS OF
SPEEDECLAIM.COM, INC.
* * * * * * * * * * *
The undersigned, constituting all of the stockholders and directors of
Speedeclaim.com, Inc., a Nevada corporation (the "Corporation"), pursuant to the
General Corporation Law of the State of Nevada, hereby unanimously consent to
the adoption of the following resolutions:
Approval of the 2000 Stock Option Plan and Granting of Options.
--------------------------------------------------------------
WHEREAS, the directors and stockholders of the Corporation deem it to
be in the best interests of the Corporation to adopt the 2000 Stock Option Plan
and to grant the options as more fully described below.
NOW, THEREFORE, IT IS HEREBY:
RESOLVED, the 2000 Stock Option Plan (the "Stock Option Plan")
of the Corporation described in document attached hereto as Exhibit A
providing, inter alia, for the Corporation in its discretion to grant
options to purchase shares of the Corporation's common stock be, and
the same hereby is, approved and adopted in all respects; and it is
further
RESOLVED, that, the Corporation shall reserve and set aside
from its authorized but unissued shares of its common stock 1,000,000
shares of its common stock deliverable upon proper exercise of the
options granted under the Stock Option Plan, such reservation to
continue so long as and to the extent required to satisfy the rights of
the holders (or future holders) of options issued to issuable under the
Stock Option Plan;
WHEREAS, the Directors of the Corporation have consulted with the
independent certified public accountants of the Corporation who have evaluated
the business and affairs of the Corporation and conducted other analysis which
were necessary or desirable to determine the fair market value of the shares of
common stock for the purposes of establishing an exercise price for options
granted under the Stock Option Plan on the date hereof pursuant to these
resolutions.
NOW, THEREFORE, IT IS HEREBY:
RESOLVED, that the fair market value exercise price of $1.00
per share shall be utilized as exercise price of options granted
pursuant to the Stock Option Plan on the date hereof pursuant to these
resolutions; and it is further
RESOLVED, that, under the terms and conditions of the Stock
Option Plan, the Corporation hereby grants to each of David Whyte,
Alastair King and Dennis Rohel 250,000 options pursuant to the Stock
Option Plan, each such option granting the holder thereof to purchase
one (1) share of the Corporation's common stock at the price and on the
other terms and conditions set forth herein and consistent with the
terms of the Stock Option Plan; and it is further
RESOLVED, that the proper officers of the Corporation execute
and deliver to the Optionees each an option agreement regarding the
grant of such options under the Stock Option Plan, the execution and
delivery of such option agreement by any proper officer of the
Corporation being conclusive evidence of such approval.
Employment Agreement of Alastair King, David Whyte and Dennis Rohel.
-------------------------------------------------------------------
WHEREAS, the Corporation intends to enter into an employment agreement
(the "King Employment Agreement") by and between the Corporation and Alastair
King attached hereto as Exhibit B pursuant to which Alastair King shall serve as
Chief Executive Officer, Principal Financial Officer and Controller of the
Corporation and receive a salary of $150,000 and a grant of stock options as set
forth above.
WHEREAS, the Corporation intends to enter into an employment agreement
(the "Whyte Employment Agreement") by and between the Corporation and David
Whyte attached hereto as Exhibit B-1 pursuant to which David Whyte shall serve
as President of the Corporation and receive a salary of $150,000 and a grant of
stock options as set forth above; and
WHEREAS, the Corporation intends to enter into an employment agreement
(the "Rohel Employment Agreement") by and between the Corporation and Dennis
Rohel attached hereto as Exhibit B-2 pursuant to which Dennis Rohel shall serve
as Chief Knowledge Officer and Secretary of the Corporation and receive a salary
of $150,000 and a grant of stock options as set forth above.
NOW, THEREFORE, IT IS HEREBY:
RESOLVED, that Alastair King is hereby appointed to serve as
the Chief Executive Officer, Principal Financial Officer and Controller
at the discretion of the Board of Directors and to have such duties,
responsibilities and obligations customarily assigned to individuals
serving in such position and such other duties, responsibilities and
obligations as the Chief Executive Officer, Principal Financial Officer
and Controller or the Board of Directors shall from time to time
specify, and to hold such office until his successor shall have been
duly elected or appointed and qualified; and it is further
RESOLVED, that Alastair King, in his capacity as the Chief
Executive Officer, Principal Financial Officer and Controller shall
have the authority to enter into contracts and agreements on behalf of
the Corporation in the ordinary course of business; and it is further
RESOLVED, that David Whyte is hereby appointed to serve as the
President at the discretion of the Board of Directors and to have such
duties, responsibilities and obligations customarily assigned to
individuals serving in such position and such other duties,
responsibilities and obligations as the President or the Board of
Directors shall from time to time specify, and to hold such office
until his successor shall have been duly elected or appointed and
qualified; and it is further
RESOLVED, that David Whyte, in his capacity as the President
shall have the authority to enter into contracts and agreements on
behalf of the Corporation in the ordinary course of business; and it is
further
RESOLVED, that Dennis Rohel is hereby appointed to serve as
the Chief Knowledge Officer and Secretary at the discretion of the
Board of Directors and to have such duties, responsibilities and
obligations customarily assigned to individuals serving in such
position and such other duties, responsibilities and obligations as the
Chief Knowledge Officer and Secretary or the Board of Directors shall
from time to time specify, and to hold such office until his successor
shall have been duly elected or appointed and qualified; and it is
further
RESOLVED, that Dennis Rohel, in his capacity as the Chief
Knowledge Officer and Secretary shall have the authority to enter into
contracts and agreements on behalf of the Corporation in the ordinary
course of business; and it is further
RESOLVED, that the Corporation agrees to be bound by the terms
and conditions of the King Employment Agreement, the Whyte Employment
Agreement and the Rohel Employment Agreement.
Registration Statement.
----------------------
WHEREAS, the Corporation desires to sell to the public up to 100,000
units each consisting of one (1) share of the Corporation's common stock, $.001
par value per share, one (1) Class A redeemable purchase warrant, and one (1)
Class B redeemable purchase warrant (each, a "Unit") pursuant to an offering to
be registered under the Securities Act of 1933, as amended (the "Act").
NOW, THEREFORE, IT IS HEREBY:
RESOLVED, that the officers of the Corporation be, and each of
them hereby is authorized, empowered and directed in the name and on
behalf of the Corporation, to prepare, execute and file, or cause to be
prepared and filed, with the Securities and Exchange Commission (the
"SEC") (i) a registration statement on Form SB-2 (the "Registration
Statement") under the Act, in one or more amendments (including,
without limitation, post-effective amendments) to the Registration
Statement under the Securities Act of 1933 for the registration of the
Units and underlying securities; (ii) one or more supplements to the
prospectus contained in the Registration Statement; and (iii) all
certificates, letters, instruments, applications and any other
documents which may be required to be filed with the SEC under the Act
with respect to the registered offering of the Units and the underlying
securities; and it is further
RESOLVED, that David Lubin, Esq. be, and hereby is, designated
and appointed as an agent for service of the Corporation in all matters
relating to the Registration Statement under the Act; and it is further
RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized, empowered and directed, in the name of and
on behalf of the Corporation to take any and all action which any of
them deem necessary or advisable in order to affect the registration or
qualification of the Units under the securities laws of the states and
other jurisdictions of the United States of America, and in connection
therewith to execute, acknowledge, verify, deliver, file and publish
all such applications, reports, covenants, resolutions and other papers
and instruments required under such laws, and to take any and all
further action which may be deemed necessary or advisable in order to
maintain any such registration or qualification; and it is further
RESOLVED, that the officers of the Corporation be, and each of
them hereby is, authorized, empowered and directed, in the name and on
behalf of the Corporation, to execute and file irrevocable written
consents on the part of the Corporation to be sued in such states and
other jurisdictions of the United States of America wherein such
consents to service of process may be required under the securities
laws thereof in connection with the registration or qualification of
the securities and to appoint the appropriate state official agent of
the Corporation for the purposes of receiving and accepting process;
and it is further
RESOLVED, that Securities Transfer Corporation in Dallas,
Texas be, and it hereby is, appointed to act as the transfer agent,
escrow agent, warrant agent and registrar for the Common Stock; and it
is further
RESOLVED, that all actions heretofore taken by the officers,
directors, employees, agents and attorneys for the Corporation in
connection with (i) the registration of the Common Stock under the Act;
(ii) the registration or qualification of the Units and underlying
securities under the securities laws of the states and other
jurisdictions of the United States of America be, and they hereby are,
ratified, approved and confirmed.
Adoption of the By-Laws of the Corporation.
------------------------------------------
WHEREAS, the by-laws of the Corporation in the form annexed hereto as
Exhibit C (the "By-laws") shall be adopted.
NOW, THEREFORE IT IS HEREBY:
RESOLVED, that the form, terms and provisions of the By-laws
in the form annexed hereto as Exhibit C is hereby ratified, approved
and adopted in all respects as the By-laws of the Corporation.
Issuance of Shares.
------------------
WHEREAS, the Corporation has determined to issue shares of common stock
$0.001 par value per share (the "Common Stock") to the individuals set forth on
Exhibit D attached hereto.
NOW, THEREFORE, IT IS HEREBY:
RESOLVED, that the Corporation accepts the offer of those
individuals set forth on Exhibit D to purchase an aggregate of
2,007,000 shares of the Common Stock of the Corporation at the cash
price indicated opposite their respective names on Exhibit D; and it is
further
RESOLVED, that the Corporation issue and deliver in the
aggregate 2,007,000 shares of its authorized but unissued Common Stock
to those individuals set forth on Exhibit D in accordance with the
terms of the offer referred to above against receipt of the
consideration for such shares referred to in such offer; that such
shares, when so issued and delivered in accordance with such offer and
after receipt of the consideration therefor, shall be fully paid and
non-assessable; and it is further
RESOLVED, that the officers of the Corporation, and each of
them acting without the others, are hereby authorized and directed to
take all such further action to prepare, execute and deliver, or
approve or authorize, as the case may be, the preparation, execution
and delivery of, all such further agreements, instruments and
documents, in the name of and on behalf of the Corporation and under
its corporate seal or otherwise, and to pay all expenses, fees and
taxes, as in their judgment shall be necessary, proper or advisable in
order to fully carry out the intent and accomplish the purposes of the
foregoing resolutions, and each of them.
This Unanimous Written Consent and Action may be executed in any number
of counterparts each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF, this Unanimous Written Consent and Action shall be
effective as of the 28th day of August, 2000.
DIRECTORS: STOCKHOLDERS:
--------- -------------
/s/ David Whyte /s/ David Whyte
-------------- --------------
DAVID WHYTE DAVID WHYTE
/s/ Alastair King /s/ Dennis Rohel
-------------- --------------
ALASTAIR KING DENNIS ROHEL
<PAGE>
EXHIBIT A
STOCK OPTION PLAN
<PAGE>
EXHIBIT B
KING EMPLOYMENT AGREEMENT
<PAGE>
EXHIBIT B-1
WHYTE EMPLOYMENT AGREEMENT
<PAGE>
EXHIBIT B-2
ROHEL EMPLOYMENT AGREEMENT
<PAGE>
EXHIBIT C
BY-LAWS
<PAGE>
EXHIBIT D
ISSUANCE OF SHARES
<TABLE>
<CAPTION>
Date Number of Shares
Shareholders of Issuance of Common Stock Consideration
------------ ----------- --------------- -------------
<S> <C> <C> <C>
Art Beroff 302,893 $ 30
Carol Beroff, in trust for
David Beroff 101,369 $ 10
Carol Beroff, in trust for
Ilana Beroff 101,369 $ 10
Elaine and Fred Beroff 101,369 $ 10
Alastair King 300,000 $ 25
Felicia Cartier 200,000 $ 200
John Gardner 187,500 $37,500
David Coolidge 187,500 $37,500
Kevin Malone 125,000 $12,500
Gavin Kirk 125,000 $25,000
Victor Cardenas 25,000 $ 25
Julia Karmanova 92,000 $ 92
Yuri Asheshov 92,000 $ 92
Svetlana Solova 36,000 $ 36
Bill Dobson 25,000 $ 25
Sandra Whyte 5,000 $ 5,000
</TABLE>
