As filed with the Securities and Exchange Commission on September 20, 2000.
Registration No. ______________
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
WORLD-WIDE CLASSICS, INC.
act name of small business issuer as specified in its charter)
Delaware 7500 87-0647505
--------------------------- ---------------------------- ----------------
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
6427 South Blaine Drive, Murray, Utah 84107 (801) 455-6027
address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
Kevin B. Denos
6427 South Blaine Drive, Murray, Utah 84107 (801) 455-6027
(Name, address, including zip code, and telephone number
including area code, of agent for service)
WITH COPIES TO:
Kenneth I. Denos, Esq.
Kenneth I. Denos, P.C.
12694 South Rosburg Dr.
Riverton, Utah 84065
(801) 971-6787
FAX (801) 446-6566
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO
THE PUBLIC: As soon as possible after the Registration
Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), check the following box. /_/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. /_/
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. /_/
If delivery of the prospectus is expected to be made pursuant to Rule 434
under the Securities Act, please check the following box. /_/
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
TITLE OF SECURITIES AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TO BE TO BE OFFERING PRICE AGGREGATE REGISTRATION
REGISTERED REGISTERED PER SHARE(1) OFFERING PRICE(1) FEE
----------------------- ---------------------- ------------------------ ----------------------- ----------------------
<S> <C> <C> <C> <C>
Common Stock 300,000 $0.50 $150,000 $39.60
======================= ====================== ======================== ======================= ======================
</TABLE>
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, ACTION PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
<PAGE>
PROSPECTUS
300,000 SHARES
WORLD-WIDE CLASSICS, INC.
------------------
COMMON STOCK
------------------
World-Wide Classics, Inc. (the "Company"), is offering, on a "best
efforts, minimum-maximum" basis (collectively, the "Offering"), up to 300,000
shares of its $0.001 par value common stock, (hereafter, "Common Stock" or the
"Shares") to the public at a price of $0.50 per Share.
Prior to this Offering, there has been no public market for the Shares of
Common Stock. The Shares will not be listed on an exchange or quoted on the
NASDAQ system upon completion of this Offering and there can be no assurance
that a market will develop or, if a market should develop, that it will
continue. The initial public Offering price has been arbitrarily determined by
the Company and bears no relationship to assets, shareholders equity, or any
other recognized criteria of value.
------------------
THE PURCHASE OF THE SHARES INVOLVES A HIGH DEGREE OF RISK AND SUBSTANTIAL
AND IMMEDIATE DILUTION AND SHOULD NOT BE PURCHASED BY PERSONS WHO CANNOT AFFORD
TO RISK THE LOSS OF THEIR ENTIRE INVESTMENT. SEE "RISK FACTORS" BEGINNING ON
PAGE 5 FOR A DISCUSSION OF CERTAIN FACTORS WHICH SHOULD BE CONSIDERED BY
PROSPECTIVE PURCHASERS IN THIS OFFERING.
------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
DISCOUNTS AND PROCEEDS TO
PRICE TO PUBLIC COMMISSIONS (1) COMPANY (2)
<S> <C> <C> <C>
Per Share................................... $0.50 $0.07 $0.43
Total Minimum............................... $50,000 $7,000 $43,000
Total Maximum............................... $150,000 $21,000 $129,000
============================================ ====================== ======================== ========================
<FN>
(1) The offering price is payable in cash upon subscription. The
offering will be managed by the Company and the Shares will be offered
and sold by the officer of the Company, without any discounts or other
commissions. Licensed NASD Broker-dealers may also participate and
receive commissions of up to 14% of the offering price on sales made by
them. See "Plan of Distribution."
(2) Proceeds to the Company are shown assuming payment of commissions to
licensed NASD broker-dealers with respect to all shares sold, but before
deducting other offering expenses payable by the Company estimated at
$9,000, for legal and accounting fees and printing costs.
(3) Proceeds will be deposited no later than noon of the next business
day after receipt into an escrow account with Brighton Bank, 311 South
State Street, Salt Lake City, Utah 84111, pending receipt of
subscriptions for at least $50,000. If subscriptions for a minimum of
100,000 Shares have not been received within 120 days from the date
hereof (unless extended by the Company for up to 30 additional days), all
proceeds will be promptly refunded to subscribers without interest
thereon or deduction therefrom. Subscribers will have no right to return
or use of their funds during the Offering period, which may last up to
150 days.
</FN>
</TABLE>
The Shares are being offered by the Company subject to prior sale,
receipt, and acceptance by the Company, approval of certain matters by counsel,
and certain other conditions. The Company reserves the right to withdraw or
cancel such offer and reject any order, in whole or in part.
-----------
The date of this Prospectus is September 14, 2000
<PAGE>
TABLE OF CONTENTS
PAGE
AVAILABLE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . 2
PROSPECTUS SUMMARY. . . . . . . . . . . . . . . . . . . . . . . . . . 3
RISK FACTORS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
DILUTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
COMPARATIVE DATA. . . . . . . . . . . . . . . . . . . . . . . . . . . 11
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
MANAGEMENT'S PLAN OF OPERATION. . . . . . . . . . . . . . . . . . . . 14
BUSINESS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
PRINCIPAL SHAREHOLDERS. . . . . . . . . . . . . . . . . . . . . . . . 23
CERTAIN TRANSACTIONS. . . . . . . . . . . . . . . . . . . . . . . . . 23
DESCRIPTION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . 24
SHARES ELIGIBLE FOR FUTURE SALE . . . . . . . . . . . . . . . . . . . 25
PLAN OF DISTRIBUTION. . . . . . . . . . . . . . . . . . . . . . . . . 26
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
AVAILABLE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . 27
FINANCIAL STATEMENTS. . . . . . . . . . . . . . . . . . . . . . . . . F-1
1
<PAGE>
AVAILABLE INFORMATION
We have filed with the United States Securities and Exchange Commission
(the "Commission") a Registration Statement on Form SB-2, under the Securities
Act of 1933, as amended (the "Securities Act"), with respect to the securities
offered hereby. As permitted by the rules and regulations of the Commission,
this Prospectus does not contain all of the information contained in the
Registration Statement. For further information regarding both the Company and
the Securities offered hereby, reference is made to the Registration Statement,
including all exhibits and schedules thereto, which may be inspected without
charge at the public reference facilities of the Commission's Washington D.C.
office, 450 Fifth Street, N.W., Washington, D.C. 20549. Copies may be obtained
from the Washington, D.C. office upon request and payment of the prescribed fee.
As of the date of this Prospectus, the Company became subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and, in accordance therewith, will file reports and other
information with the Commission. Reports and other information filed by the
Company with the Commission pursuant to the informational requirements of the
Exchange Act will be available for inspection and copying at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the following regional offices of
the Commission: New York Regional Office, 75 Park Place, New York, New York
10007; Chicago Regional Office, 500 West Madison Street, Chicago, Illinois
60661. Copies of such material may be obtained from the public reference section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates.
Copies of Our Annual, Quarterly, and other Reports which will be filed
with the Commission commencing with the Quarterly Report for the first quarter
ended after the date of this Prospectus (due 45 days after the end of such
quarter) will also be available upon request, without charge, by writing
World-Wide Classics, Inc., 6427 Blaine Drive, Murray, Utah 84107.
UNTIL 90 DAYS AFTER THE DATE OF THIS PROSPECTUS, ALL DEALERS EFFECTING
TRANSACTIONS IN THE REGISTERED SECURITIES, WHETHER OR NOT PARTICIPATING IN THIS
DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY ANY STATE SECURITIES
COMMISSION OR OTHER STATE REGULATORY AUTHORITY, AND NO SUCH REGULATORY AUTHORITY
HAS PASSED UPON THE TERMS OF THIS OFFERING OR APPROVED THE MERITS THEREOF.
INVESTORS MUST RELY ON THEIR OWN EXAMINATION OF THE COMPANY AND THE TERMS OF
THIS OFFERING IN EVALUATING THE MERITS AND RISKS OF THE OFFERING AND MAKING AN
INVESTMENT DECISION.
YOU SHOULD READ THIS PROSPECTUS IN ITS ENTIRETY PRIOR TO MAKING AN INVESTMENT IN
THE COMPANY.
2
<PAGE>
PROSPECTUS SUMMARY
This Prospectus contains certain statements of a forward-looking nature
relating to future events or the future financial performance of the Company.
You are cautioned that such statements are only predictions and that actual
events or results may differ materially. In evaluating such statements, you
should specifically consider the various factors identified in this Prospectus,
including the matters set forth under the caption, "Risk Factors," which would
cause actual results to differ materially from those indicated by such
forward-looking statements. The following summary is qualified in its entirety
by the more detailed information, including "Risk Factors" and the description
of the Company and its proposed operations appearing elsewhere in this
Prospectus.
THE COMPANY
WORLD-WIDE CLASSICS, INC. (sometimes referred to hereinafter as "We,"
"Our," "Us," or the "Company") was incorporated under the laws of the State of
Delaware on October 27, 1999. We have not commenced active business operations
and are considered a development stage company. Our proposed business and
purpose is to create an offline and online clearinghouse for classic and antique
automobiles and to engage in and perform any and all acts and activities
customary or incidental to a specialized automobile brokerage business. We
intend to use the proceeds of this Offering, if successful, to acquire selected
vehicles and to purchase office and computer equipment, targeted advertising and
to develop a website, and for initial working capital to begin active business
operations upon completion of this Offering. Throughout this prospectus, the
reader will sometimes be referred to as "You" or "Your."
Our mailing address and the telephone number of Our principal executive
offices are 6427 Blaine Drive, Murray, Utah 84107. (801) 455-6027.
<TABLE>
THE OFFERING
<CAPTION>
<S> <C> <C>
Securities Offered.............. 300,000 shares of Common Stock, par value $0.001 per share
("Common Stock"). See "DESCRIPTION OF SECURITIES."
Offering Price.................. $0.50 Per Share.
Plan of Distribution............ The Offering will be managed by Us and the Shares will be
offered and sold by the officers of the Company, without any
discounts or other commissions. Licensed NASD broker-dealers
may also participate and receive commissions of up to 14% of the
Offering price on sales made by them. Offering proceeds will be
escrowed pending completion or termination of the Offering.
The Offering will terminate 120 days from the date hereof (of 150
days if extended by Us for an additional 30 days), and funds held
in escrow will be promptly returned to subscribers, without
interest thereon or deduction therefrom, unless the Offering is
completed on or before that date upon receipt of subscriptions for
at least the minimum Offering amount ($50,000). See "PLAN
OF DISTRIBUTION."
3
<PAGE>
Escrow Agent.................... Brighton Bank, 311 South State Street, Salt Lake City, Utah
84111, will serve as escrow agent for receipt
of proceeds from this Offering.
Transfer Agent.................. American Registrar & Transfer Co., 342 East 900 South, Salt
Lake City, Utah 84111, (801) 363-9065, has agreed to serve as
transfer agent and registrar for the Company's outstanding
securities upon completion of the Offering.
Securitie Outstanding.......... The Company is
authorized to issue up to 50,000,000 shares of
Common Stock and presently has 1,000,000
shares of common stock issued and outstanding.
Upon completion of this Offering, if all
Shares offered herein are sold, 1,300,000
Shares will be issued and outstanding;
1,100,000 Shares will be issued and
outstanding if only the minimum number of
Shares offered herein are sold. In addition,
the Company is authorized to issue up to
5,000,000 shares of Preferred Stock in one or
more series with such rights and preferences
as the Board of Directors may designate. The
Board of Directors has not designated any such
series and no preferred shares are presently
issued and outstanding.
Risk Factors.................... We are a start up company with no operating history;
consequently, an investment in the Company is highly
speculative. You will suffer substantial dilution in the book value
of Your Shares compared to the purchase price. In seeking to
implement Our proposed business, We could incur substantial
losses during the development stage, and require additional
funding for which We have no commitments. Management has
other interests which may conflict with the interests of the
Company. Until such time, if ever, that the Company generates
sufficient revenue to pay management a salary, management will
not be employed full time and will only devote a minimal amount
of time to the affairs of the Company. We cannot assure You that
Our proposed business will be successful, nor can We assure you
that We could find other business ventures in the event the
proposed business fails. We presently have no plans,
commitments, or arrangements with respect to any other potential
business venture. You should not invest in the Company if you
cannot afford to lose Your entire investment. See "RISK
FACTORS."
</TABLE>
4
<PAGE>
RISK FACTORS
You should consider carefully the risk factors set forth below, in
addition to the other information contained in this Prospectus, before making a
decision to purchase the Shares. This Prospectus contains, in addition to
historical information, forward-looking statements that involve risks and
uncertainties. Our actual results may differ materially from the results
discussed in the forward-looking statements as a result of certain factors,
including those set forth in the following "Risk Factors" and elsewhere in this
Prospectus. In each instance in which a risk factor identifies an event that
would or could adversely affect the Company, such risk should be viewed as
potentially adversely affecting Our business, results of operations, and
financial position.
RISKS INHERENT IN A NEW STARTUP COMPANY
No Operating History. The Company was only recently organized, has no
significant assets, no current business operations nor any history of operations
and is considered to be a development stage enterprise. There is absolutely no
assurance that We will be able, upon completion of this Offering, to
successfully implement Our proposed business or that it will ever operate
profitably. In the event Our proposed business is unsuccessful, We cannot assure
You that the Company could successfully become involved in any other business
venture. We presently have no plans, commitment, or arrangements with respect to
any other potential business venture. See "MANAGEMENT'S PLAN OF OPERATIONS,"
"BUSINESS," AND FINANCIAL STATEMENTS.
Limited Capital/Need for Additional Capital. We presently have no
significant operating capital and are totally dependent upon receipt of the
proceeds of this Offering to provide the minimum capital necessary to commence
Our proposed business. Upon completion of the Offering, the amount of capital
available to Us will still be extremely limited, especially if only the minimum
amount of the Offering is raised. We have no commitments for additional cash
funding beyond the proceeds expected to be received from this Offering. In the
event that the proceeds from this Offering are not sufficient, We may need to
seek additional financing from commercial lenders or other sources, for which We
presently have no commitments or arrangements. See "MANAGEMENT'S PLAN OF
OPERATIONS," "BUSINESS," AND FINANCIAL STATEMENTS.
Broad Discretion with Respect to Allocation of Net Proceeds. The net
proceeds from the sale of the Common Stock offered to You will be added to the
Company's general working capital upon the completion of this Offering and is
intended to be used in the manner set forth below under "USE OF PROCEEDS." We
have not reserved or allocated the proceeds for any specific purpose other than
as set forth in this prospectus, and We cannot specify with more certainty how
We will use the net proceeds. We will have considerable discretion in the
application of the net proceeds, and You will not have the opportunity, as part
of Your investment decision, to assess, whether, in Your judgment, the proceeds
will be used appropriately. The net proceeds may be used for corporate purposes
that do not increase the Company's profitability or market value. Pending
application of the proceeds, they may be placed in investments that do not
produce income or that lose value.
5
<PAGE>
Dependence Upon Officers & Directors/Business and Time Conflicts. The
Company will be totally dependent in the conduct of its proposed business upon
the knowledge, skills, and experience of the President of the Company, Kevin B.
Denos. As compared to many other public companies, We do not have a depth of
managerial and technical personnel. Accordingly, there is a greater likelihood
that loss of the services of Mr. Denos would have a material adverse effect upon
the Company. The Company has no employment contract with or key man life
insurance upon the President. Furthermore, the President of the Company will not
be employed full-time, at least initially, and is involved with other businesses
and has other interests which could give rise to conflicts of interest with
respect to the business of and amount of time devoted to the Company. There is
no assurance such conflicts will be resolved favorably to the Company. See
"CERTAIN TRANSACTIONS."
No Dividends. We do not currently intend to pay cash dividends on Our
Common Stock and do not anticipate paying such dividends at any time in the
foreseeable future. At present, We will follow a policy of retaining all of Our
earnings, if any, to finance development and expansion of Our business. See
"DESCRIPTION OF SECURITIES."
Limited Liability of Management. We have adopted provisions in Our
Certificate of Incorporation and Bylaws which limit the liability of Officers
and Directors and provide for indemnification by the Company of Officers and
Directors to the fullest extent permitted under Delaware Law, which provides
that officers and directors shall have no personal liability to a corporation or
its stockholders for monetary damages for breach of fiduciary duties as
directors, except for a breach of the duty of loyalty, acts or omissions not in
good faith or which involve intentional misconduct or knowing violation of law,
acts involving the unlawful payment of dividends or unlawful stock purchases or
redemptions, or any transaction from which a director derives an improper
personal benefit. Such provisions substantially limit Your ability to hold
directors and officers liable for breaches of fiduciary duty, and may require
the Company to indemnify its officers and directors.
RISKS RELATED TO THE NATURE OF THE PROPOSED BUSINESS
Limited Experience of Management and Lack of Established Reputation.
Although the President of the Company has developed general automotive
knowledge, neither he nor the Company are well known or have established any
significant reputation or prominence in the automobile brokerage business, and
We cannot assure You that We will be able to facilitate significant commerce in
the buying and selling of classic automobiles. See "BUSINESS" AND "MANAGEMENT."
Competitive Market. We will operate in a highly competitive environment.
Buying and selling used specialized automobiles (both online and offline) is
widespread, and is a highly fragmented market with numerous participants
possessing extensive vertical and horizontal networks to provide access to a
wide variety of automobiles for a broad spectrum of tastes and styles. See
"BUSINESS - Competition."
6
<PAGE>
Risks of Loss from Damage, Theft, Etc. The automobiles most highly sought
after by collectors and certain consumers can become extremely valuable, which
creates a need for security precautions to reduce the risk of theft or other
loss. The Company will be dependent upon its President to maintain security,
insurance, and to provide handling, transportation, and storage of such
automobiles, but We cannot assure You that measures taken will be adequate to
prevent loss.
RISKS RELATED TO THE OFFERING
Lack of Underwriter Participation. Because We have not engaged the
services of an Underwriter with respect to this Offering, the independent due
diligence review of the Company, its affairs and financial condition, which
would ordinarily be performed by an underwriter and its legal counsel, has not
been performed with respect to the Company and You will not have the benefit of
an underwriter's independent due diligence review. See "PLAN OF DISTRIBUTION."
Dilution. You will suffer substantial dilution in the purchase price of
the Shares compared to the net tangible book value per share immediately after
the Offering. See "DILUTION."
Best Efforts Offering/No Firm Commitment. We are offering the Shares on a
"best efforts, minimum-maximum basis." There is no underwriter and no firm
commitment from anyone to purchase all or any of the Shares offered. No
assurance can be given that all or any of the Shares will be sold. However,
escrow provisions have been made to ensure that if subscriptions for a minimum
of 100,000 Shares are not received within the Offering period, plus any
extensions, all funds received will be promptly refunded within 5 days to
subscribers, without interest thereon or deduction therefrom. During the
Offering period, which could last up to 150 days, subscribers will receive no
interest on their funds nor have any use or right to return of the funds. See
"PLAN OF DISTRIBUTION."
Benefits to Present Stockholders/Disproportionate Risks. The 1,000,000
shares of the Company's presently outstanding Common Stock are owned by the
President and founders of the Company, for which they paid $5,000 cash. If all
Shares offered are sold, immediately after completion of the Offering, present
stockholders will own approximately 77% of the then outstanding Common Stock,
and investors in this Offering will own the other 23%, for which they will have
paid $150,000 cash. If only the minimum number of Shares offered are sold,
present stockholders will own approximately 91% of the then outstanding Common
Stock, and investors in this Offering will own the other 9%, for which they will
have paid $50,000 cash. Thus, You will contribute to capital of the Company
disproportionately more than the percentage of ownership You receive. Present
stockholders will benefit from a greater share of the Company if successful,
while You risk a greater loss of cash invested if the Company is not successful.
See "COMPARATIVE DATA."
Continuation of Management Control. Upon completion of this Offering,
present shareholders, which includes current management of the Company, will own
a majority of the total outstanding securities and will have absolute control of
the Company. Investors in this
7
<PAGE>
Offering as a group will have no ability to remove, control, or direct such
management. Only one-half of the outstanding shares is required to constitute a
quorum at any stockholders meeting, and action may be taken by a majority of the
voting power present at a meeting, or may be taken without a meeting by written
consent of stockholders holding a majority of the total voting power. See
"PRINCIPAL STOCKHOLDERS" and "DESCRIPTION OF SECURITIES."
Arbitrary Determination of Offering Price. We have arbitrarily determined
the public offering price of the Shares and have set such price at a level
substantially in excess of the price paid by founding stockholders for
securities of the same class. The Offering price bears no relationship to the
Company's assets, book value, net worth, or other economic or recognized
criteria of value. In no event should the public offering price be regarded as
an indicator of any future market price of Our securities. See Cover Page,
"COMPARATIVE DATA," and "CERTAIN TRANSACTIONS."
No Assurance of a Liquid Public Market for Securities. There has been no
public market for the Shares prior to the Offering made hereby. The Shares will
not be listed on an exchange or quoted on the NASDAQ system upon completion of
this Offering and We cannot assure You that any market will develop for the
securities or that if a market does develop, that it will continue. We cannot
assure You as to the depth or liquidity of any market for Common Stock or the
prices at which You may be able to sell Your Shares. As a result, an investment
in the Shares may be totally illiquid and You may not be able to liquidate Your
investment readily or at all when You need or desire to sell. See "PLAN OF
DISTRIBUTION."
Volatility of Stock Prices. In the event a public market does develop for
the Shares, market prices will be influenced by many factors, and will be
subject to significant fluctuation in response to variations in operating
results of the Company and other factors such as investor perceptions of the
Company, supply, and demand, interest rates, general economic conditions, and
those specific to the industry, international political conditions, developments
with regard to the Company's activities, future financial condition, and
management. See "PLAN OF DISTRIBUTION."
Shares Eligible for Future Sale. All of the shares of Common Stock
currently outstanding are restricted securities which are not presently, but may
in the future be sold, pursuant to rule 144, into any public market that may
develop for the Common Stock. Future sales by current shareholders could depress
the market prices of the Common Stock in any such market. See "SHARES ELIGIBLE
FOR FUTURE SALE."
Potential Issuance of Additional Common and Preferred Stock. The Company
is authorized to issue up to 50,000,000 shares of Common Stock, of which only
1,300,000 shares at most will be issued and outstanding upon completion of this
Offering. To the extent of such authorization, the Board of Directors of the
Company will have the ability, without seeking shareholder approval, to issue
additional shares of Common Stock in the future for such consideration as the
Board of Directors may consider sufficient. The issuance of additional Common
Stock in the future will reduce proportionate ownership and voting power
8
<PAGE>
of the Common Stock offered hereby. The Company is also authorized to issue up
to 5,000,000 shares of preferred stock, the rights and preferences of which may
be designated in series by the Board of Directors. To the extent of such
authorization, such designations may be made without shareholder approval. The
Board of Directors has not designated any series or issued any shares of
preferred stock. The designation and issuance of series of preferred stock in
the future would create additional securities which would have dividend and
liquidation preferences over the Common Stock offered hereby. See "DESCRIPTION
OF SECURITIES."
Applicability of Penny Stock Risk Disclosure Requirements. The Shares
will be considered a "penny stock" as that term is defined in rules promulgated
under the Securities Exchange Act of 1934. Under these rules, broker-dealers
participating in transactions in penny stocks must first deliver a Schedule 15G
risk disclosure document which describes the risks associated with penny stocks,
the broker-dealer's duties, the customer's rights and remedies, and certain
market and other information, and make a suitability determination approving the
customer for penny stock transactions based upon the customer's financial
situation, investment experience, and objectives. Broker-dealers must also
disclose these restrictions in writing to the customer and obtain specific
written consent of the customer, and provide monthly account statements to the
customer. With all these restrictions, the likely effect of a designation as a
penny stock will be to decrease the willingness of broker-dealers to make a
market for the stock, to decrease the liquidity of the stock and increase the
transaction cost of sales and purchases of penny stocks compared to other
securities. See "PLAN OF DISTRIBUTION."
9
<PAGE>
DILUTION
Dilution is the difference between the public offering price of $0.50 per
share for the Common Stock offered to You in this prospectus, and the net
tangible book value per share of the Common Stock immediately after You have
purchased it. The Company's net tangible book value per share is calculated by
subtracting the Company's total liabilities from its total assets less any
intangible assets, and then dividing by the number of shares then outstanding.
The net tangible book value (NTBV) of the Company prior to the Offering,
based upon the June 30, 2000 financial statements, was $1,563 or $0.0016 per
common share. Prior to selling any shares in this Offering, the Company has
1,000,000 shares outstanding.
If all shares offered herein are sold, the Company will have 1,300,000
shares outstanding upon completion of the Offering. The estimated post-offering
pro forma net tangible book value of the Company, which gives effect to receipt
of the estimated net proceeds from the offering and issuance of the additional
Shares of Common Stock in the Offering, but does not take into consideration any
other changes in the net tangible book value of the Company after June 30, 2000,
will be $151,563, or approximately $0.1166 per share. This would result in
dilution to You of $0.3834 per share, or 76.7% of the public offering price of
$0.50 per share. Net tangible book value per share would increase to the benefit
of the present stockholders from $0.0016 per share prior to the Offering to
$0.1166 per share after the Offering, or an increase of $0.115 per share
attributable to the purchase of the Shares by You and the other investors in
this Offering.
If only the minimum number of Shares are sold, the Company will have
1,100,000 shares outstanding upon completion of the Offering. The post-offering
pro forma net tangible book value of the Company, would be $51,563, or
approximately $0.0469 per share. This would result in dilution to You of $0.4531
per share, or 90.6% of the public offering price of $0.50 per share. Net
tangible book value per share would increase to the benefit of the present
stockholders from $0.0016 per share prior to the Offering to $0.0469 per share
after the Offering, or an increase of $0.0453 per share attributable to the
purchase of the Shares by investors in this Offering.
The following table sets forth the estimated net tangible book value
("NTBV") per share after the Offering and the dilution to You based on the
foregoing minimum and maximum offering assumptions:
<TABLE>
<CAPTION>
Minimum Maximum
<S> <C> <C>
Public Offering Price per Share $0.50 $0.50
NTBV per Share Prior to Offering $0.0016 $0.0016
Increase Attributable to New Investors $0.0453 $0.115
Post-Offering Pro Forma NTBV per Share $0.0469 $0.1166
Dilution to New Investors in this Offering $0.4531 $0.3834
</TABLE>
10
<PAGE>
COMPARATIVE DATA
The following charts illustrate the pro forma proportionate ownership in
the Company, upon completion of the Offering under alternative minimum and
maximum offering assumptions, of present stockholders and of investors in this
Offering, compared to the relative amounts paid and contributed to capital of
the Company by present stockholders and by You and other investors in this
Offering, assuming no changes in net tangible book value other than those
resulting from the Offering.
<TABLE>
MINIMUM OFFERING
<CAPTION>
Shares Owned Percent Cash Percent Price Per
Paid Share
<S> <C> <C> <C> <C> <C>
Present Shareholders 1,000,000 90.9% $ 5,000 9.1% $0.005
New Investors 100,000 9.1% $50,000 90.9% $0.50
MAXIMUM OFFERING
Present Shareholders 1,000,000 77.0% $ 5,000 3.2% $0.005
New Investors 300,000 23.0% $150,000 96.8% $0.50
</TABLE>
11
<PAGE>
USE OF PROCEEDS
The net proceeds to the Company from the sale of the 150,000 Shares
offered hereby at a public offering price of $0.50 per Share will vary depending
upon the total number of Shares sold and the amount, if any, of commissions paid
to licensed NASD broker-dealers in connection with such sales (Licensed NASD
broker-dealers may participate and receive commissions of up to 14% of the
Offering price on sales made by them, or We may pay finders fees if no
commission is paid and the payment of such fees is permissible under applicable
law). Regardless of the number of Shares sold and the amount, if any, of
commissions paid, We expect to incur other offering expenses estimated at $9,000
for legal, accounting, printing, and other costs in connection with the
Offering. The following table sets forth gross and net proceeds, alternatively,
under the minimum and maximum offering assuming that commissions are paid with
respect to all sales, and Our present estimate of the allocation and
prioritization of net proceeds expected to be received from this Offering.
Actual receipts and expenditures may vary from these estimates. Pending use, We
intend to invest the net proceeds in investment-grade, short-term, interest
bearing securities.
<TABLE>
<CAPTION>
Minimum Maximum
Offering Offering
<S> <C> <C>
Gross Proceeds $ 50,000 $ 150,000
Commissions/Finders Fees (14%) 7,000 21,000
Other Offering Expenses 9,000 9,000
------- ------
NET OFFERING PROCEEDS(1) $ 34,000 $ 120,000
======== =========
Acquisition of Equipment and Inventory (2) $ 11,000 $ 40,000
Marketing and Travel (3) 3,000 10,000
Web Site Development (4) 5,000 12,000
Initial Operating Expenses and Working 15,000 58,000
-------- ------
Capital (5)
TOTAL $ 34,000 $ 120,000
======== =========
<FN>
(1) The above allocation of portions of the net proceeds reflect Our
current plans, and there are likely to be changes which reflect various
factors, including general market conditions and other developments.
(2) This is the approximate amount of net proceeds of the Offering which
management estimates will be used to acquire miscellaneous office
equipment, computer hardware and software, and certain automobiles which
may be included in inventory.
(3) This represents the approximate amount management estimates that it
will expend during the initial start-up period (approximately one year)
for travel to and from locations to locate certain automobiles, and for
advertising on the
12
<PAGE>
Internet, in various newspapers, and in trade magazines such as Auto
Trader, Henning's Motor News, and Old Car Trader.
(4) This represents estimated web hosting fees, programming fees, and
software acquisition expenses incurred in connection with the development
of the Company's web site.
(5) We intend to use the remaining portion of the net proceeds to cover
rent and other operating expenses and provide working capital during the
initial start-up of operations.
</FN>
</TABLE>
13
<PAGE>
MANAGEMENT'S PLAN OF OPERATIONS
The following discussion should be read in conjunction with the Company's
consolidated financial statements and the notes associated with them contained
elsewhere in this prospectus.
PLAN OF OPERATIONS
The Company was only recently incorporated on October 27, 1999. We have
not commenced planned principal operations and are considered a development
stage company. The Company has no significant assets, no active business
operations, nor any results therefrom. To date, Our activities have been limited
to organizational matters, a limited amount of market research, minimal travel,
acquisition of Our Internet domain name, bids to facilitate the purchase and
sale of only a few automobiles, and the preparation and filing of the
registration statement of which this prospectus is a part.
Our plan of operations for the next twelve months is first to raise funds
from this Offering. If the Offering is successful, We intend to use the proceeds
for the acquisition of equipment and inventory, marketing and travel, to pay for
initial operating expenses, and to fund working capital. We are totally
dependent upon this Offering and receipt of the proceeds therefrom, of which We
cannot assure you of Our ability to commence Our intended business operations.
The Company was formed to engage in the business of facilitating the purchase
and sale of classic automobiles. We intend to provide these services to car
collectors as well as the general public. There is absolutely no assurance that
Our proposed business will succeed and that We will be able, with the proceeds
of this Offering, to successfully facilitate the purchase and sale of
automobiles on a scale sufficient to cover Our costs or become profitable. In
the event We are unsuccessful at implementing Our proposed business, We cannot
assure You that the Company could successfully become involved in any other
business venture. We presently have no plans, commitments, or arrangements with
respect to any other proposed business venture.
At this time, no assurances can be given with respect to the timing of
commencement of operations or the length of time after commencement that it will
be necessary to fund operations from the proceeds of this Offering. We intend to
commence operations as soon as possible after the Offering is completed and We
receive the proceeds therefrom.
We believe that the proceeds of this Offering will be sufficient to cover
Our operating expenses for six months to a year after commencement of
operations, during which time We believe We can begin generating sufficient
revenues from sales and operations to thereafter cover ongoing expenses.
However, there is absolutely no assurance of this, and if We are unable to
generate sufficient revenues from operations to cover expenses within such time
frame, We will have to seek additional debt or equity financing for which We
have no commitments.
14
<PAGE>
BUSINESS
HISTORY OF THE COMPANY
World-Wide Classics, Inc. was recently incorporated under the laws of the
State of Delaware on October 27, 1999. We have not commenced active business
operations of a material nature and are considered a development stage company.
To date, Our activities have been limited to organizational matters, a limited
amount of market research, minimal travel, acquisition of Our Internet domain
name, bids on several vehicles with a completed purchase and sale of one
automobile, and the preparation and filing of the registration statement of
which this prospectus is a part. In connection with the organization of the
Company, the President, Secretary, and founders of the Company contributed an
aggregate of $5,000 cash to initially capitalize the Company in exchange for
1,000,000 shares of Common Stock. We have no significant assets, and are totally
dependent upon the successful completion of this Offering and receipt of the
proceeds therefrom, of which We cannot assure you of Our ability commence Our
proposed business operations.
MARKET
MOTOR VEHICLES - GENERALLY. The Polk Company, a marketing research firm,
reports that over 200 million vehicles are registered in the United States. The
world's three largest vehicle manufacturers - Ford, General Motors, and
Daimler-Chrysler reported aggregate retail new vehicle sales of 17.5 million
units, totaling over $488 billion in revenues internationally for 1999. In the
United States, approximately $709 billion and $652 billion was spent on new and
used vehicles, representing the sale of approximately 58 million and 56 million
units in 1998 and 1999, respectively. According to the National Automobile
Dealers Association, 25 million of these 58 million unit sales in 1999 were new
vehicles, meaning that approximately 57% of all domestic vehicle sales were of
pre-owned vehicles. According to the Polk Company, the median age for vehicles
in the United States was 8.1 years for cars, and 7.8 years for trucks, almost
double the median age for cars and trucks in 1970. These figures suggest that
sales of used vehicles will continue to represent an ever-increasing percentage
of total vehicle sales.
MOTOR VEHICLE DEALERS. Dealers of new and used vehicles in the United
States are facing increased competitive pressures from a variety of sources.
Some of these sources evidence trends that We believe are favorable to Our
business concept:
- A Perceived Overabundance of Dealers. The National Automobile
Dealers Association reports over 22,000 dealers in the United States
alone. Dealers find themselves competing for increasingly smaller
customer bases, resulting in shrinking inventories, which may force
dealers to increase margins on the remaining inventory to cover
commissions, overhead, and other expenses.
15
<PAGE>
- Better Educated Consumers that Dislike High Pressure Sales
Tactics. Largely due to the Internet, consumers are generally better
educated about pricing, styles, options, features, and other factors
influencing the buying decision. Because consumers are generally more
informed from unbiased sources, they tend to resist high pressure sales
methods and desire a buying process that is more closely aligned with a
traditional haggle-free buying experience.
- Decreasing Margins. The efficiency of the Internet and other
medium have led to decreased margins for dealers, because these dealers
cannot offer a product superior to any other dealer selling the same
vehicle and to whom consumers now have easier access. Consequently, We
believe that the sale of custom, specialized vehicles remains one of the
last areas in the automobile sales industry in which margins can be
maintained due to the limited availability of certain makes, models, and
years for certain vehicles.
THE INTERNET AND E-COMMERCE. The Internet has emerged as a global medium
for communication, content delivery, and e-commerce, and Internet use continues
to increase rapidly. International Data Corporation estimates that the number of
Internet users worldwide will increase to 319 million by 2002, or roughly 6% of
the world population, and will continue to increase at a compound annual growth
rate of 35% for the next several years. As consumers have become increasingly
adept at utilizing the Internet for evaluating and purchasing a wide variety of
goods, the dollar volume of goods and services purchased over the Internet is
estimated to reach $425 billion in 2002. We believe that the number of Internet
users will continue to grow based on a number of factors, including the large
and growing base of installed personal computers in the home and workplace, the
decreasing cost of personal computers, easier, faster, and cheaper access to the
Internet, the distribution of broadband applications, the proliferation of
Internet content, and the increasing familiarity and acceptance of the Internet
by businesses and consumers.
OUR PROPOSED BUSINESS
SPECIALIZED AUTOMOBILE BROKERAGE AND CONSULTING. Our business concept is
based upon locating specialty vehicles with high resale appeal and using
traditional offline as well as online methods to market these vehicles to an
eager target market. In addition, We intend to provide specialized online and
offline automotive consulting, including database-driven FAQ profiles for common
issues affecting the purchase, sale, licensing, maintenance, and repair of older
vehicles, as well as online and offline car care and restoration advice. As We
continue to develop our services, We also intend to use the services of various
automotive pricing services, such as Kelley Blue Book, and the National
Automotive Dealers Association pricing guide. In short, We want to link buyers
and sellers in an information-rich environment to improve the buying and selling
experience for classic automobiles, without the stress and confusion associated
with transactions involving automobile dealers.
16
<PAGE>
A SELLER'S MARKET. We believe that the key to success in the specialized
auto brokerage business is in concentrating on finding sellers instead of
buyers. This notion runs completely contrary to the retail automobile market and
most other retail markets, where efforts are directed exclusively to satisfy a
consumer need or stimulate the growth of new consumers in an existing market. In
the specialized automobile market, certain classic cars literally sell
themselves because of their idiosyncratic value to certain persons and their
willingness to pay a premium for a vehicle that suits their subjective tastes.
Because the specialty automobile market has historically been a seller's market,
We intend to initially locate those vehicles that will be most appealing to
collectors and automobile enthusiasts. Because of the unique characteristics of
this market, instead of simply selling cars, Our objective is to match
discriminating buyers with the right vehicle and features at an agreeable price,
with personally relevant consulting services to augment the buying/selling
experience.
BUILD ON A CONSERVATIVE SCALE - USING THE GLOBAL MEDIUM OF THE INTERNET.
The proceeds of this Offering, by itself, will not give Us enough resources to
expand Our services on a large scale. Consequently, We intend to initially
operate in the Salt Lake City metropolitan market and surrounding western states
and expand regionally as We develop Our business, particularly through the
Internet.
We have purchased rights for use of the domain name http://www.world-
wideclassics.com which will serve as Our Internet site. We intend to provide
capabilities for uploading photos and specifications of vehicles posted for sale
and will process inquiries for the sellers of such vehicles through the site.
Eventually, We also intend to create a database of buyers and sellers to enable
Us to locate popular and rare vehicles for discriminating consumers that post
their specifications for such vehicles on the Internet. In short, Our Web site
will be created to appeal primarily to buyers, while Our offline efforts will
cater primarily to the needs of sellers, with each group intermediated by the
Company.
OFFLINE AS WELL AS ONLINE SALES. We believe that the Internet represents
the most efficient medium for consumers to learn about, sell, and shop for
specialized vehicles. Nevertheless, many owners of classic automobiles are
typically in advanced age brackets, do not have Internet access, and are not
regular users of new technologies to facilitate the purchase or sale of such a
vehicle. Consequently, these persons are likely unfamiliar with online methods
of brokering the purchase/sale of their vehicles. To reach this base of
consumers and sellers, We intend to engage a regionally-based sales force that
will seek out specialized and hard-to-find automobiles in surrounding
communities to profile on the Company's site and offline advertisements for sale
on a consignment basis. Once these vehicles have been located, We intend to
market them to consumers through Our web site and other more traditional offline
methods.
ADVANTAGES OF A SPECIALIZED CLEARINGHOUSE FOR CLASSIC CARS. Although
there are numerous online and offline services which broker automobiles, only a
relative few focus only on the sale of moderately priced classic vehicles such
as World-Wide Classics. Because this
17
<PAGE>
represents the largest segment of the specialized automobile market, We offer
Our customers the following advantages:
- EXPERIENCE IN THE AUTOMOTIVE INDUSTRY. Our management is
familiar with consumer trends with respect to older vehicles
(including the emotional attachment people have to certain
vehicles), and therefore relies upon pricing manuals and, more
importantly, upon their personal experience in advising business
and individual clients in the automotive industry for over a
decade.
- CONSUMER-TO-CONSUMER FOCUS. The specialized vehicle market
does not lend itself to the creation of dealerships and, therefore,
vehicle owners themselves typically serve as the dealer in a sales
transaction. Moreover, Our consumers are not looking to trade in an
existing vehicle for credit, and usually do not seek traditional
automobile financing for the purchase of a specialized vehicle all
of which lessen the need for dealer involvement. Because We serve
as the only intermediary between sellers and buyers, We can offer
more competitive rates for our service, without the difficulty of
maintaining a larger dealer network such as some of Our online
competitors. Automotive News.com has recently reported that
Autoweb.com and Autobytel.com have experienced substantial dealer
attrition since the beginning of 2000, and may continue to do so
throughout the remainder of year.
COMPETITION
The market for the purchase of vehicles and automotive-related products
and services is intensely competitive, and We expect competition to increase
significantly, particularly on the Internet. Barriers to entry on the Internet
are relatively low, and We may face competitive pressures from numerous
companies. There are many regionally-based used and antique vehicle dealerships
and services throughout the United States. There are also a number of auto sales
and service companies with a strong Internet presence such as Autoweb.com,
Autobytel.com and MSN Carpoint. In addition, there are several online companies
that specialize in auto brokerage services, namely CarsDirect.com and
Greenlight.com. There are also a number of web sites that provide electronic
classified ads for used vehicles. Moreover, there are numerous web sites that
offer vehicle information and other content, as well as community offerings,
directly to the vehicle buying consumer or targeted audiences such as car
collectors. We also face competition from large dealer groups and traditional
media companies, such as newspaper, television, and radio companies. In
addition, to the foregoing competitors, We also compete with offline vehicle
brokerage firms, discount warehouse clubs, and automobile clubs, such as the
affinity programs offered by Costco Wholesale Corporation and Wal-Mart Stores,
Inc. Several prominent auction web sites have also recently announced their
intention to auction vehicles on the Internet. We also compete with a variety of
automotive data, vehicle manufacturer and dealer services companies. We believe
that the principal competitive factors in facilitating many transactions will be
the breadth and quality of selection; availability of information in online and
offline formats, and personalized service.
18
<PAGE>
Most of Our existing and potential competitors have longer operating histories
in the used automobile and Internet markets, greater name recognition, larger
consumer bases and significantly greater financial, technical and marketing
resources than We do. Some of Our competitors receive over 1.5 million visitors
to their web sites each month. These competitors may be able to undertake more
extensive marketing campaigns for their brand, products and services, adopt more
aggressive pricing policies and make more attractive offers to potential
employees. Furthermore, Our existing and potential competitors may develop
offerings that equal or exceed the quality of Our offerings, or achieve greater
market acceptance, than Ours. We cannot assure you that We will be able to
compete successfully against Our current or future competitors or that
competition will not have a material adverse effect on Our business, results of
operations and financial condition.
GOVERNMENT REGULATION
THE INTERNET. Currently few laws or regulations have been adopted that
apply directly to Internet business activities. The adoption of local, state, or
national laws or regulations may decrease the growth of Internet usage and the
acceptance of Internet commerce. Recently, several proposals have been submitted
to the U.S. Congress to increase Internet regulation and the taxation of certain
activities over the Internet. In addition, the legislatures of several states
have discussed the possibility of regulating companies that conduct business
over the Internet with residents of their respective states. While We are not
aware of any such legislation in place, any law, rule, or regulation hindering
the ability of consumers or organizations to transact business on the Internet
could have a material adverse effect on Our results of operations and financial
condition.
FRANCHISE LAWS. Our relationships with various sellers of classic
automobiles could be found to constitute a "franchise" under federal and state
franchise laws. If Our activities are deemed to constitute franchising, We may
be subject to licensing, additional reporting, and disclosure requirements.
Compliance with varied laws, regulations, and enforcement characteristics found
in each state may require Us to allocate many of Our resources in compliance
therewith, which may have an adverse effect on Our results of operations and
financial condition.
VEHICLE BROKERAGE LAWS. By facilitating the purchase and sale of
specialized vehicles, We will likely be considered an automobile broker under
the laws of each state in which We operate. Consequently, as We expand our
network of vehicle buyers and sellers, We intend to become licensed in each
state in which We conduct Our business. At a minimum, licensing in each state
will require Us to pay administrative fees and post bonds of a specified amount,
the result of which may retard Our ability to expand as quickly as market
opportunities may present themselves.
19
<PAGE>
FACILITIES
Our executive offices are located in Murray, Utah, only a few miles from
downtown Salt Lake City. Our offices have relatively quick access to two major
interstate freeways and to the Salt Lake International Airport. Pursuant to the
successful completion of this Offering, We intend to relocate Our operations
within the same general area to a facility which may provide indoor
accommodations to several automobiles. In addition, We intend to use an outside
firm to provide co-location services for our web site. We believe that such
facilities, if secured, will be adequate for Our needs and do not anticipate any
difficulty locating additional facilities, if necessary.
LEGAL PROCEEDINGS
We are not a party to any pending or threatened legal proceedings.
20
<PAGE>
MANAGEMENT
DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN KEY EMPLOYEES
The following table sets forth certain information as of September 1,
2000 concerning the directors and executive officers of the Company:
Name Age Position
Kevin B. Denos 35 President, Chief Executive Officer, and Director
Clara Evans 28 Secretary and Director
----------------------
KEVIN B. DENOS, is a founder of the Company and serves as the Company's
CEO, President and Chairman of the Board of Directors. Mr. Denos has spent most
of his life as a full or part-time mechanic and automobile enthusiast. Mr. Denos
attended Utah Technical College for two years, studying heavy-duty mechanics. He
has spent considerable time, restoring, rebuilding, and refurbishing
automobiles, as well as consulting area businesses and individuals regarding
appraisal, acquisition, disposition, restoration, and care of a wide range of
makes and models of motor vehicles. Mr. Denos holds no directorships in any
other company subject to the reporting requirements of the Securities Exchange
Act of 1934.
CLARA EVANS, serves as Secretary of the Company and as a member of the
Board of Directors. Ms. Evans is a paraprofessional working with handicapped
children in Murray, Utah, utilizing her strong organizational skills. Prior to
her work as a paraprofessional, Ms. Evans was employed by Mailboxes, etc. in
in Salt Lake City, Utah. Ms. Evans attended Murray High School. Ms. Evans
20
<PAGE>
holds no directorships in any other company subject to the requirements of the
Securities Exchange Act of 1934.
EXECUTIVE COMPENSATION
The Company has only been recently incorporated, has not yet commenced
planned operations, and has not paid any compensation to its executive officers
or directors to date.
PROPOSED COMPENSATION. Upon completion of the Offering, the officers and
directors will be entitled to reimbursement of any out of pocket expenses
reasonably and actually incurred on behalf of the Company. Initially, We
anticipate that the officers will devote only a portion of their time to the
affairs of the Company. No person will be employed full-time and will not
receive a regular salary or wage for his or her time, unless and until the
Company's business operations develop to the point where a full-time or other
extensive time commitment is required. In lieu thereof, Mr. Denos will initially
work for the Company on a commission
basis, receiving a percentage of the revenues received from the facilitation of
a successful transaction involving the purchase and sale of an automobile. The
Company presently has no formal written employment agreements or other
arrangements or understandings with the officers regarding the commitment of
time or the payment of salaries or other compensation, and there is no assurance
that the presently contemplated arrangements will continue for any specified
length of time in the future, nor any assurance with respect to the continued
availability to the Company of the services of Mr. Denos. However, Mr. Denos is
presently prepared to devote such time as may be necessary to the development of
the Company's business, including full time, if that becomes necessary. In such
case, the Company may pay Mr. Denos a reasonable salary commensurate with his
skill and contribution to the Company.
21
<PAGE>
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information regarding beneficial
ownership of the Company's Common Stock as of September 1, 2000, and as adjusted
to reflect the sale of Common Stock offered in this Offering by (i) each person
(or group of affiliated persons) who is known by the Company to beneficially own
more that 5% of the outstanding shares of its Common Stock, (ii) each director
and executive officer of the Company and (iii) all executive officers and
directors of the Company as a group. Unless indicated otherwise, the address for
each officer, director and 5% stockholder is c/o the Company, 6427 South, Blaine
Drive, Murray, Utah 84107.
<TABLE>
<CAPTION>
TITLE OF PERCENTAGE PERCENTAGE AFTER
NAME AND ADDRESS CLASS SHARES OF CLASS MAXIMUM OFFERING
---------------- ----- ------ -------- ----------------
<S> <C> <C> <C> <C>
Kevin B. Denos................ Common 40,000 4.0% 3.1%
Clara Evans................... Common 10,000 1.0% 0.7%
George W. Denos(2)............ Common 450,000 45.0% 39.1%
Eslie O. Barlow............... Common 500,000 50.0% 43.5%
-------------------------
<FN>
(1) For each stockholder, the calculation of percentage of shares and
beneficial ownership prior to the Offering is based on 1,000,000 shares
of Common Stock outstanding as of September 1, 2000. For each
stockholder, the calculation of percentage of shares and beneficial
ownership after the Offering is based upon 1,300,000 shares of Common
Stock outstanding. No options, warrants, rights, or instruments
convertible into common stock of the Company are currently outstanding.
The persons named in the table have sole voting and investment power with
respect to all shares of Common Stock shown as beneficially owned by
them, subject to applicable community property laws.
(2) Principal Shareholder of the Company and the father of the President,
Kevin B. Denos.
</FN>
</TABLE>
CERTAIN TRANSACTIONS
In connection with the organization of the Company, its founding
shareholders paid an aggregate of $5,000 cash ($2,500 from Eslie Barlow, $2,250
from George Denos, $200 from Kevin Denos, and $50 from Clara Evans) to purchase
1,000,000 shares of Common Stock of the Company at a price of $0.005 per share.
It is contemplated that the Company may enter into certain transactions
with officers, directors, or affiliates of the Company which, even though they
may involve conflicts of interest in that they are not arms' length
transactions, are believed to be fair and equitable transactions in the best
interest of the Company. Our policy is that all transactions between the Company
and any affiliates be on terms no less favorable to the Company than could be
obtained from unaffiliated parties.
Mr. Kevin Denos, as President of the Company, anticipates initially
devoting up to 20% of his time to the affairs of the Company. If and when the
business operations of the Company increase and a more extensive time commitment
is needed, Mr. Denos is prepared to devote more time to the Company, in the
event that becomes necessary.
22
<PAGE>
The Company has no formal written employment agreement or other contracts
with its President, and there is no assurance that the services and facilities
to be provided by Mr. Kevin Denos will be available for any specific length of
time in the future. The amounts of compensation and other terms of any full time
employment arrangements with Mr. Denos would be determined if and when such
arrangements become necessary.
DESCRIPTION OF SECURITIES
COMMON STOCK
The Company is authorized to issue 50,000,000 shares of Common Stock, par
value $0.001 per share. As of September 1, 2000, there were 1,000,000 shares of
Common Stock outstanding. Holders of Common Stock are entitled to one vote per
share for the election of directors and with respect to all other matters to be
voted on by stockholders. Shares of Common Stock do not carry cumulative voting
rights and, therefore, holders of a majority of the outstanding shares of Common
Stock will be able to elect the entire Board of Directors, and if they do so,
minority shareholders would not be able to elect any members to the Board of
Directors. The Company's Board of Directors has authority, without action by the
Company's shareholders, to issue all or any portion of the authorized but
unissued shares of Common Stock, which would reduce the percentage ownership of
the Company by its existing shareholders and which may dilute the book value of
the Common Stock.
Shareholders of the Company have no pre-emptive rights to acquire
additional shares of Common Stock. The Common Stock is not subject to redemption
and carries no subscription, sinking fund, or conversion rights. Holders of
Common Stock will be entitled to receive ratably such dividends as may be
declared by the Company's Board of Directors from time to time out of funds
legally available therefor. The Company has not paid dividends on its Common
Stock in the past and does not anticipate that it will pay dividends in the
foreseeable future. In the event of liquidation of the Company, the shares of
the Company's Common Stock are entitled to share equally in the corporate assets
after satisfaction of all liabilities.
ANTITAKEOVER PROVISIONS
Certain provisions of the Company's Certificate of Incorporation
("Certificate") and the Bylaws adopted therefrom may have the effect of
preventing, discouraging, or delaying a change in the control of the Company and
may maintain the incumbency of the Board of Directors and management. Moreover,
the Certificate provides that these provisions of the Certificate relating to
number and vacancies, may only be amended by a vote of at least 662/3% of the
shareholders. Finally, the Bylaws provide that special meetings of the
stockholders may only be called by the President of the Company or pursuant to a
resolution adopted by a majority of the Board of Directors.
23
<PAGE>
TRANSFER AGENT AND REGISTRAR
The Transfer Agent and Registrar of the Common Stock offered hereby is
American Registrar & Transfer Co., 342 East 900 South, Salt Lake City, Utah
84111.
DIVIDEND POLICY
The Company has not previously paid any cash dividends on Common Stock
and does not anticipate paying dividends on Common Stock in the foreseeable
future. It is the present intention of management to utilize all available funds
for the development of the Company's business. The only restrictions that limit
the ability to pay dividends on common equity or that are likely to do so in the
future, are those restrictions imposed by law. Under Delaware corporate law, no
dividends or other distributions may be made which would render the Company
insolvent or would reduce assets to less than the sum of its liabilities plus
the amount needed to satisfy outstanding liquidation preferences.
SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of this Offering, the Company will have 1,300,000 shares
of Common Stock outstanding. Of the outstanding shares of Common Stock, only the
shares sold in this Offering will be freely tradeable without restriction or
further registration under the Securities Act of 1933 (the "Securities Act"),
unless held by "affiliates" of the Company, as that term is defined in Rule 144
of the Securities Act ("Affiliates").
The remaining 1,000,000 shares of Common Stock are "restricted
securities" within the meaning of Rule 144 under the Securities Act and were
issued and sold by the Company in private transactions and may be publicly sold
only if registered under the Securities Act or sold in accordance with an
applicable exemption from registration, such as Rule 144.
In general, under Rule 144, as currently in effect, a person (or persons
whose shares are aggregated) who has beneficially owned restricted shares for at
least one year, as well as persons who may be deemed Affiliates, will be
entitled to sell in any three-month period a number of shares that does not
exceed the greater of (i) 1% of the then outstanding shares of Common Stock or
(ii) the average weekly trading volume of the Common Stock during the four
calendar weeks immediately preceding the date on which notice of the sale is
filed with the Securities and Exchange Commission. Sales pursuant to Rule 144
are also subject to certain other requirements relating to manners of sale,
notice and availability of current public information about the Company. A
person (or person whose shares are aggregated) who is not deemed to have been an
Affiliate at any time during the three months immediately preceding the sale is
entitled to sell restricted shares pursuant to Rule 144(k) without regard to the
limitations described above, provided that two years have expired since the
later of the date on which such restricted shares were first acquired from the
Company or from an Affiliate.
24
<PAGE>
The Company cannot predict the effect, if any, that sales of shares of
Common Stock, or the availability of such shares for sale will have on the
market price prevailing from time to time. Sales of substantial amounts of
Common Stock in the public market could adversely affect prevailing market
prices.
PLAN OF DISTRIBUTION
We are offering up to 300,000 shares of the Company's $0.001 par value
Common Stock to the public on a "best efforts, 100,000 shares minimum, 300,000
shares maximum" basis, at a price of $0.50 per share. The Offering will be
managed by the Us without an underwriter. We may enter into agreements with
securities broker-dealers who are members of the National Association of
Securities Dealers, Inc. (NASD), whereby these broker-dealers will be involved
in the sale of the Shares and will be paid a commission by the Company of up to
14% of the offering price of the Shares sold by them. In addition, the Shares
will be offered and sold by the officers of the Company, who will receive no
sales commissions or other compensation in connection with the Offering, except
for reimbursement of expenses actually incurred on behalf of the Company in
connection with such activities. This will not involve any reallocations between
NASD members and non-members. The Company will not compensate any of its
officers or directors for sale of securities hereunder but may pay a finders fee
(not to exceed 14%) to other persons who introduce the Company to investors,
where no sales commission is paid and such payment is permitted under applicable
state law. Neither Mr. Kevin Denos not any other associated person of the
Company is an associated person of a broker or dealer or subject to any
statutory disqualification as defined in Section 3(a)(39) of the Securities Act,
nor will any such person be compensated in connection with his participation in
the Offering, which participation will be limited to distributing this
prospectus or other written communication (the content of which is approved by
an officer or director of the Company), by mail or other means that does not
involve oral solicitation, responding to inquiries of prospective purchasers
with information contained herein and performing ministerial and clerical work
involved in effecting sales transactions.
We cannot assure You that all or any of the Shares will be sold. If We
fail to receive subscriptions for a minimum of 100,000 Shares within 120 days
from the date of this prospectus (or 150 days if extended by the Company), the
Offering will be terminated and any subscription payments will be promptly
refunded within 5 days to subscribers, without any deduction therefrom or any
interest thereon. If subscriptions for at least the minimum amount are received
within such period, funds will not be returned to investors and the Company may
continue the Offering until such periods expire or subscriptions for all 100,000
Shares have been received, whichever occurs first. Current shareholders may
purchase up to 10 percent of the Shares offered hereby. Any such purchases will
be made for investment purposes only and not with a view toward further resale,
and may be made for the purpose of completing at least the minimum amount of the
Offering.
25
<PAGE>
All subscription payments should be made payable to Brighton Bank as
Escrow Agent for the Company. The Company and any participating broker-dealers
will mail or otherwise forward all subscription payments received, by noon of
the next business day following receipt, to Brighton Bank at 311 South State
Street, Salt Lake City, Utah 84111 for deposit into the escrow account being
maintained by Brighton Bank as Escrow Agent for the Company, pending receipt of
subscriptions for at least a minimum of 100,000 Shares or expiration of the
Offering period, whichever occurs first. Subscription payments will only be
disbursed from the escrow account to the Company if at least 100,000 Shares are
sold, of if not sold, for the purpose of refunding subscription payments to the
subscribers. You will have no right to return or use of Your funds during the
Offering period, which may last up to 150 days.
26
<PAGE>
LEGAL MATTERS
Certain legal matters with respect to the validity of the Common Stock
offered hereby will be passed upon for the Company by Kenneth I. Denos, P.C.,
Riverton, Utah.
EXPERTS
The consolidated financial statement of World-Wide Classics, Inc. as of
June 30, 2000 included in this Prospectus have been examined by HJ & Associates,
L.L.C., independent certified public accountants, as indicated in their report
with respect thereto, and are included herein in reliance on such report given
upon the authority of that firm as experts in accounting and auditing.
ADDITIONAL INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission"), Washington, D.C. 20549, a Registration Statement on Form SB-2
under the Securities Act with respect to the Shares. This Prospectus does not
contain all of the information set forth in the Registration Statement. For
further information with respect to the Company and such Common Stock, reference
is made to the Registration Statement and exhibits and schedules thereto.
Statements contained in this Prospectus as to the contents of any contract or
any other document referred to are not necessarily complete, and, with respect
at any contract or other document filed as an exhibit to the Registration
Statement, each statement is qualified in all respects by reference to such
exhibit. The Registration Statement, including any exhibits thereto, may be
inspected without charge at the Commission's public reference facility at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the Pacific
regional offices of the Commission at 5670 Wilshire Boulevard, 11th Floor, Los
Angeles, California 90036-3648. Copies of all or any part of such materials may
be obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549 after payment of fees
prescribed by the Commission. The Commission maintains a Web site that contains
online reports, proxy and information statements, and other information
regarding registrants. The address of the Commission's Web site is
http://www.sec.gov.
27
<PAGE>
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
WORLD-WIDE CLASSICS, INC.
C O N T E N T S
Independent Auditors' Report.................................................. 2
Balance Sheet................................................................. 3
Statement of Operations...... ................................................ 4
Statement of Stockholders' Equity (Deficit)................................... 5
Statement of Cash Flows....................................................... 6
Notes to the Financial Statements............................................. 7
F-1
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Stockholders of
World-Wide Classics, Inc.
(A Development Stage Company)
Murray, Utah
We have audited the accompanying balance sheet of World-Wide Classics, Inc. (a
development stage company) as of June 30, 2000 and the related statements of
operations, stockholders' equity (deficit), and cash flows from inception on
February 1, 2000 through June 30, 2000. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of World-Wide Classics, Inc. (a
development stage company) as of June 30, 2000 and the results of its operations
and its cash flows from inception on February 1, 2000 through June 30, 2000 in
conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 3 to the
financial statements, the Company currently has minimal operations or assets
which raises substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 3. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
HJ & Associates, LLC
Salt Lake City, Utah
August 31, 2000
F-2
<PAGE>
<TABLE>
WORLD-WIDE CLASSICS, INC.
(A Development Stage Company)
Balance Sheet
ASSETS
<CAPTION>
June 30,
2000
CURRENT ASSETS
<S> <C>
Cash $ 3,763
Inventory 300
---
Total Current Assets 4,063
-----
TOTAL ASSETS $ 4,063
= =====
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
----------------------------------------------
CURRENT LIABILITIES
Accounts payable $ 2,500
- -----
Total Current Liabilities 2,500
-----
Total Liabilities 2,500
-----
STOCKHOLDERS' EQUITY (DEFICIT)
Preferred stock, par value $0.001; authorized 500,000
shares; -0- shares issued and outstanding -
Common stock, par value $0.001; authorized 50,000,000
shares; 1,000,000 shares issued and outstanding 1,000
Additional paid-in capital 4,000
Accumulated deficit (3,437)
------
Total Stockholders' Equity (Deficit) 1,563
-----
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 4,063
= =====
</TABLE>
The accompanying notes are an integral part of these
financial statements.
F-3
<PAGE>
<TABLE>
WORLD-WIDE CLASSICS, INC.
(A Development Stage Company)
Statement of Operations
<CAPTION>
From
Inception on
February 1,
2000 Through
June 30,
2000
<S> <C>
REVENUES $ 1,200
COST OF SALES 1,200
-----
GROSS MARGIN -
------
EXPENSES
General and administrative 3,437
-----
Total Expenses 3,437
-----
NET LOSS $ (3,437)
= ======
BASIC LOSS PER SHARE $ (0.00)
= =====
</TABLE>
The accompanying notes are an integral part of these
financial statements.
F-4
<PAGE>
<TABLE>
WORLD-WIDE CLASSICS, INC.
(A Development Stage Company)
Statement of Stockholders' Equity (Deficit)
<CAPTION>
Deficit
Accumulated
Additional During the
Common Paid-in Development
------------------------
Shares Amount Capital Stage
---------- ---------- ----------- -----------
<S> <C> <C> <C> <C>
Inception, February 1, 2000 - $ - $ - $ -
Common stock issued for cash
at $0.005 per share 1,000,000 1,000 4,000 -
Net loss from inception on
February 1, 2000 through
June 30, 2000 - - - (3,437)
------ ------ ------ ------
Balance, June 30, 2000 1,000,000 $ 1,000 $ 4,000 $ (3,437)
========= = ===== = ===== = ======
</TABLE>
The accompanying notes are an integral part of these
financial statements.
F-5
<PAGE>
<TABLE>
WORLD-WIDE CLASSICS, INC.
(A Development Stage Company)
Statement of Cash Flows
<CAPTION>
From
Inception on
February 1,
2000 Through
June 30,
2000
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C>
Net loss $ (3,437)
Changes in assets and liabilities:
(Increase) in inventory (300)
Increase in accounts payable 2,500
-----
Net Cash Used by Operating Activities (1,237)
------
CASH FLOWS FROM INVESTING ACTIVITIES -
------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock 5,000
-----
Net Cash Provided by Financing Activities 5,000
-----
NET INCREASE IN CASH AND CASH EQUIVALENTS 3,763
CASH AT BEGINNING OF PERIOD -
------
CASH AT END OF PERIOD $ 3,763
= =====
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for:
Interest $ -
Income taxes $ -
</TABLE>
The accompanying notes are an integral part of these
financial statements.
F-6
<PAGE>
WORLD-WIDE CLASSICS, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000
NOTE 1 - ORGANIZATION
World-Wide Classics, Inc. (the Company) was organized on October
27, 1999, under the laws of the State of Delaware. The Company
began operations on February 1, 2000, therefore, for accounting
purposes, the inception date is February 1, 2000. The purpose of
the Company is to perform any lawful activity permitted by the
State of Delaware in an effort to obtain or develop a line or
lines of business. The Company has not conducted significant
business operations and in accordance with SFAS #7, is considered
a development stage company.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES AND PROCEDURES
The Company has no significant operations to date and its
accounting policies and procedures have not been determined,
except as follows:
Accounting Method
The Company uses the accrual method of accounting and has adopted
a December 31 year end.
Basic Loss Per Share
Basic loss per share has been calculated based on the weighted
average number of shares of common stock outstanding during the
period.
From
Inception on
February 1,
2000 Through
June 30,
2000
Numerator - loss $ (3,437)
Denominator - weighted average number of
shares outstanding 1,000,000
---------
Loss per share $ (0.00)
= =====
Income Taxes
As of June 30, 2000, the Company had a net operating loss
carryforward for federal income tax purposes of approximately
$3,400 that may be used in future years to offset taxable income
through 2020. The tax benefit of the cumulative carryforwards has
been offset by a valuation allowance of the same amounts.
Cash and Cash Equivalents
F-7
<PAGE>
For purposes of financial statement presentation, the Company
considers all highly liquid investments with a maturity of three
months or less, from the date of purchase to be cash equivalents.
WORLD-WIDE CLASSICS, INC.
(A Development Stage Company)
Notes to the Financial Statements
June 30, 2000
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES AND PROCEDURES (Continued)
Use of Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
NOTE 3 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of
liabilities in the normal course of business. The Company has not
yet established an ongoing source of revenues sufficient to cover
its operating costs and allow it to continue as a going concern.
The ability of the Company to continue as a going concern is
dependent on the Company obtaining adequate capital to fund
operating losses until it becomes profitable. If the Company is
unable to obtain adequate capital, it could be forced to cease
operations.
In order to continue as a going concern, develop a reliable source
of revenues, and achieve a profitable level of operations, the
Company will need, among other things, additional capital
resources. Management's plans to continue as a going concern
include (1) raising additional capital through sales of common
stock, the proceeds of which would be used to market and develop
the existing software and related rights, hiring of
administrative, sales and marketing personnel and (2) the use of
stock options to pay for employee compensation and marketing
services. However, management cannot provide any assurances that
the Company will be successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is
dependent upon its ability to successfully accomplish the plans
described in the preceding paragraph and eventually secure other
sources of financing and attain profitable operations. The
accompanying financial statements do not include any adjustments
that might be necessary if the Company is unable to continue as a
going concern.
F-8
<PAGE>
NO DEALER, SALESPERSON OR OTHER 300,000 SHARES
PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR WORLD-WIDE CLASSICS, INC.
REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE COMPANY.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY COMMON STOCK
SECURITY OTHER THAN THE SHARES OF COMMON
STOCK TO WHICH THIS PROSPECTUS RELATES, OR ANY
OFFER IN ANY JURISDICTION IN WHICH THE PERSON
MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO, OR TO ANY PERSON TO WHOM
IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS --------------------------
PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN PROSPECTUS
THE AFFAIRS OF THE COMPANY OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF --------------------------
ANY TIME SUBSEQUENT TO THE DATE HEREOF.
---------------------------
TABLE OF CONTENTS PAGE
AVAILABLE INFORMATION............2
PROSPECTUS SUMMARY...............3
RISK FACTORS................... .5 ---------------------------
DILUTION........................10
COMPARATIVE DATA................11
USE OF PROCEEDS.................12
MANAGEMENT'S PLAN
OF OPERATION...........14
BUSINESS....................... 15 SEPTEMBER 14, 2000
MANAGEMENT......................21
PRINCIPAL SHAREHOLDERS..........23
CERTAIN TRANSACTIONS............23
DESCRIPTION OF SECURITIES.......24
SHARES ELIGIBLE FOR FUTURE SALE.25
PLAN OF DISTRIBUTION............26
LEGAL MATTERS...................27
EXPERTS.........................27
AVAILABLE INFORMATION...........27
FINANCIAL STATEMENTS............F-1
---------------------------
------------------------------- ---------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS
DELAWARE GENERAL CORPORATE LAW
Section 102(b)(7) of the Delaware General Corporation Law ("DGCL")
allows a corporation to eliminate or limit the personal liability of a director
to the corporation or its shareholders for monetary damages for breach of
fiduciary duty except for:(i) any breach of the duty of loyalty to the
corporation or its stockholders; (ii) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law; (iii)
declaration of unlawful dividends or unlawful stock repurchases or redemptions;
(iv) any transaction from which the director derived an improper benefit; or (v)
any act or omission occurring prior to the date any such provision eliminating
or limiting such liability became effective.
Section 145(a) of the DGCL provides that a corporation may indemnify an
officer or director who is or is threatened to be made a party to a proceeding
(other than an action by or in the right of the corporation) by reason of the
fact that such officer or director is or was (i) serving as an officer,
director, employee, or agent of the corporation, or (ii) served at the request
of such corporation as an officer, director, employee, or agent of another
corporation or other enterprise or entity. Such indemnification may only be made
if the officer's or director's conduct was in good faith and in a manner such
person reasonably believed to be in or not opposed to the corporation's best
interests, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe that his conduct was unlawful. Section 145(c) of the
DGCL provides that a corporation shall indemnify an officer or director for his
reasonable expenses in connection with the defense of any proceeding if the
officer or director has been successful, on the merits or otherwise. Section
145(e) provides that a corporation may advance expenses to an officer or
director who is made a party to a criminal or civil proceeding before a final
disposition is made, if the corporation receives an undertaking by or on behalf
of such officer or director to repay any amounts advanced if it is determined
that such officer or director was not entitled to indemnification. Section
145(j) provides that the indemnification provisions of Section 145 continue for
a person who has ceased to be an officer or director, and inures to the benefit
of the heirs, executors, and administrators of such person. Section 145(g)
provides that a corporation may purchase and maintain insurance on behalf of
officers or directors, among others, against liabilities imposed upon them by
reason of actions in their capacities as such, and whether or not the
corporation would have the power to indemnify them against such liability under
Section 145.
CERTIFICATE OF INCORPORATION
Article VI of the Certificate of Incorporation provides that the
liability of directors to the Company or its stockholders is eliminated to the
fullest extent permitted under the DGCL, as described in the preceding section.
BYLAWS
Article VI, Section 6.1(a) of the Bylaws provides that an officer or
director who was or is made party to, or is threatened to be made a party to, or
is involved in any proceeding by reason of the fact that he or she is or was an
officer or director, or is or was serving at the request of the
<PAGE>
corporation as a director, officer, employee, or agent of another corporation,
or as its representative in another enterprise shall be indemnified and held
harmless to the fullest extent permitted and subject to the standards of
conduct, procedures, and other requirements under Delaware law. Article, VI,
Section 6.1(a) further provides that the Company may purchase and maintain
insurance on behalf of an officer or director against any liability arising out
of their status as such, whether or not the corporation would have the power to
indemnify such officer or director.
Article VI, Section 6.1(b) of the Bylaws provides that the right of an
officer or director to indemnification shall continue beyond termination as such
an inures to the benefit of the heirs and personal representatives of such
officer or director.
Article VI, Section 6.1(d) of the Bylaws provides that the Company
shall, from time to time, reimburse or advance to an officer or director the
funds necessary for payment of expenses incurred in connection with defending
any proceeding for which he or she is indemnified by the corporation, in advance
of the final disposition of such proceeding, provided that, if then required by
the DGCL, such advancements may only be paid upon the receipt by the corporation
of an undertaking by or on behalf of such officer or director to repay any such
amount so advanced if it is ultimately determined by a final and unappealable
judicial decision that the officer or director is not entitled to be indemnified
for such expenses.
<PAGE>
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by the Registrant in connection
with the sale of the securities being registered. All amounts are estimates
except for the fees payable to the Commission.
SEC Registration Fee.................................... $ 39.60
Printing and engraving expenses......................... 260.00
Legal fees and expenses................................. 6,000.00
Accounting fees and expenses............................ 1,200.00
Blue Sky filing fees.................................... 450.00
Transfer Agent fees and expenses........................ 250.00
Escrow agent fees and expenses.......................... 750.40
Miscellaneous........................................... 50.40
-----------------
Total.......................................... $ 9,000.00
=================
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES
On February 1, 1999, in consideration for $5,000 in cash, the Company
sold and issued 1,000,000 shares of Common Stock to the officers and directors
of the Company and two other persons with a relationship to such officers and
directors residing in the state of Utah in order to receive seed capital to
organize the Company. The Company believes that the transactions were exempt
from the registration provisions of the Securities Act of 1933 pursuant to
Sections 3(a)(11) and 4(2) of such Act.
<PAGE>
ITEM 27. EXHIBITS
The following exhibits are filed as part of this Registration Statement
<TABLE>
<CAPTION>
EXHIBIT
NUMBER TITLE OF DOCUMENT
------ -----------------
<S> <C> <C>
3.1 Certificate of Incorporation of World-Wide Classics, Inc., a
Inc., a Delaware corporation.
3.2 Bylaws of World-Wide Classics, Inc., a Delaware corporation.
4.1 Form of Common Stock Certificate.
5.1 Opinion of Kenneth I. Denos, P.C., Attorney at Law (including
consent).
10.1 Form of Subscription Agreement
23.1 Consent of HJ & Associates, L.L.C.
23.2 Consent of Kenneth I. Denos, P.C. (Filed as part of Exhibit 5.1).
---------------
</TABLE>
ITEM 28. UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended, may be permitted to directors, officers, and
controlling persons of the registrant pursuant to any provisions or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the 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 a 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 that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
new form of prospectus shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
<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, in the city of Salt
Lake City, state of Utah, on September 14, 2000.
WORLD-WIDE CLASSICS, INC.
By: /s/ Kevn G. Denos
--------------------------------
Kevin B. Denos
Chief Executive Officer
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the capacities and
on the dates stated.
Signature Title Date
/s/ Kevin B. Denos
---------------------- President, Chief September 14, 2000
Kevin B. Denos Executive Officer, and
Director (Principal
Executive Officer)
/s/ Clara Evans
---------------------- Secretary and Director September 14, 2000
Clara Evans
