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SCHEDULE 14C INFORMATION
INFORMATION STATEMENT PURSUANT TO SECTION 14(c) OF THE
SECURITIES EXCHANGE ACT OF 1934
[Amendment No. ____]
Check the appropriate box:
[X] Preliminary Information Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14c-5(d)(2))
[ ] Definitive Information Statement
Cambridge Holdings, Ltd.
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(Name of Registrant as Specified in its Charter)
Payment of Filing Fee (Check the appropriate box):
[ ] No fee required.
[X] Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
1. Title of each class of securities to which transaction applies:
Common Stock, $.001 par value
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2. Aggregate number of securities to which transaction applies:
3,029,870
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3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
$.00033 (Determined, pursuant to Rule 0-11(a)(4), as one-third of
the par value of the securities to be distributed in connection
with the Spinoff described in the Information Statement.)
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4. Proposed maximum aggregate value of transaction:
$999.86
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5. Total fee paid:
$.20
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[ ] Fee paid previously with preliminary materials.
[X] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
1. Amount Previously Paid: $.80
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2. Form, Schedule or Registration Statement No.: Registration
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Statement on Form SB-2
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3. Filing Party: CamCap, Inc.
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4. Date Filed: October 13, 2000
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THE INFORMATION CONTAINED IN THIS INFORMATION STATEMENT IS SUBJECT TO COMPLETION
OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO CAMCAP, INC.'S COMMON STOCK
HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES
WILL NOT BE ISSUED BEFORE THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS
INFORMATION STATEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION
OF AN OFFER TO BUY THESE SECURITIES.
Cambridge Holdings, Ltd.
7315 East Peakview Avenue
Englewood, Colorado 80111
October ____, 2000
Dear Cambridge Holdings, Ltd. Shareholders:
We are pleased to inform you that the Board of Directors of Cambridge Holdings,
Ltd. ("Cambridge") has determined to distribute to holders of its common stock
shares of the common stock of CamCap, Inc., a recently formed Colorado
corporation ("CamCap"), which is currently a subsidiary of Cambridge (the
"Spinoff"). The distribution will occur on November ___, 2000.
CamCap was organized to identify and complete a merger or acquisition with a
private entity. A registration statement is being filed as the primary
attraction of CamCap as a merger partner or acquisition vehicle may be its
status as a reporting public company.
The Spinoff will give the Cambridge shareholders a direct investment in CamCap,
in addition to retaining their holdings in Cambridge, and is a major step in
repositioning our businesses to enhance their value to shareholders.
The record date for the Spinoff is November ___, 2000. If you own common stock
of Cambridge as of the close of business on the record date, you will receive
one share of CamCap common stock for every share of Cambridge common stock that
you own at that time. Cambridge intends to distribute shares of CamCap common
stock on November ____, 2000.
You do not need to take any action for the Spinoff to occur. You do not have to
pay for the shares of CamCap common stock that you will receive in the Spinoff,
nor do you have to surrender or exchange shares of Cambridge common stock in
order to receive shares of CamCap common stock. The number of shares of
Cambridge common stock that you own will not change as a result of the Spinoff.
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This Information Statement gives you information about CamCap and its plans to
identify and complete a merger or acquisition with a private entity. We are
enthusiastic about the Spinoff and the separate public status of these two
companies. We urge you to read this document carefully to learn more about the
two companies and the Spinoff.
Sincerely,
Gregory Pusey
President
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INFORMATION STATEMENT/ PROSPECTUS
3,029,870 SHARES OF COMMON STOCK
OF
CAMCAP, INC.
CamCap, Inc. is a development stage company organized in the State of
Colorado to identify and complete a merger or acquisition with a private entity.
All 3,029,870 shares of CamCap are owned by Cambridge Holdings, Ltd.,
and CamCap is a subsidiary of Cambridge. Cambridge has determined to effect a
Spinoff of the 3,029,870 shares of CamCap to the shareholders of Cambridge. The
shareholders of Cambridge common stock will receive one share of CamCap common
stock for every share of Cambridge common stock that they own on the record date
of November ____, 2000. No payment will be made by the Cambridge shareholders
for the CamCap common stock and no action is necessary by the Cambridge
shareholders to participate in the Spinoff.
No public market currently exists for the CamCap common stock and none
is likely to develop in the near future.
NO VOTE OF SHAREHOLDERS OF CAMBRIDGE IS REQUIRED IN CONNECTION WITH THE SPINOFF.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
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AN INVESTMENT IN THE CAMCAP COMMON STOCK INVOLVES A HIGH DEGREE OF RISK (SEE
"RISK FACTORS" BEGINNING ON PAGE 6).
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this Information Statement/Prospectus is ___________, 2000
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TABLE OF CONTENTS
SUMMARY
INTRODUCTION
FORWARD-LOOKING STATEMENTS
RISK FACTORS
CamCap Has No Operating History Or Revenue Which Would Permit You To Judge
The Probability Of CamCap's Success
CamCap Has No Funds And Is Not Raising Any Money In Connection With The
Spinoff
CamCap Has Limited Funds And Does Not Intend To Hire A Full-Time Management
Team That Can Conduct A Complete Investigation And Analysis Of A Merger Or
Acquisition Candidate. CamCap May Not Find A Suitable Candidate
We Expect That CamCap Will Encounter Substantial Competition For A Merger
Candidate
We Have No Agreements For A Business Combination And We Have Not Established
Any Particular Standards For A Business Combination
The Search For A Merger Candidate Will Be Conducted Principally By The
President Of CamCap, Who Is Engaged In Other Business Activities And Will
Have Limited Time Availability
Mr. Pusey May Participate In Business Ventures Which Could Be Deemed To
Compete Directly With CamCap
We Expect That There Will Be A Change In Control Or Management Of CamCap
After A Merger We Expect That Your Percentage Share Ownership In CamCap
Following Any Merger Or Acquisition Will Be Substantially Reduced
The Requirement Of Audited Financial Statements May Disqualify Business
Opportunities
We Expect That Tax Consequences Will Be Considered In Any Potential
Acquisition
We Do Not Expect Any Trading Market To Develop In CamCap Stock Until A
Business Combination Is Completed And There Will Be Significant Restrictions
On Resale Of The CamCap Common Stock
THE SPINOFF
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
BUSINESS
MANAGEMENT
PRINCIPAL SHAREHOLDERS
LEGAL PROCEEDINGS
DESCRIPTION OF SECURITIES
SHARES ELIGIBLE FOR FUTURE SALE
LEGAL MATTERS
EXPERTS
WHERE YOU CAN FIND ADDITIONAL INFORMATION
FINANCIAL STATEMENTS
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SUMMARY
The following summary highlights some of the information in this
Information Statement and Prospectus. It may not contain all of the information
that is important to you. To understand the Spinoff fully, you should read the
entire document carefully, including the Risk Factors beginning on page 6.
INTRODUCTION
The Spinoff is a result of a decision made by the management of
Cambridge to enhance the value of Cambridge to its shareholders. We believe that
shareholder value will be enhanced by separating the Cambridge business and the
newly-created entity of CamCap into two separate, stand-alone companies. After
the Spinoff, Cambridge will continue its business activities, which have been
concentrated in real estate in Colorado, and CamCap will attempt to identify and
complete a merger or acquisition with a private entity whose business presents
an opportunity for its shareholders.
We have highlighted certain information in this Summary to explain the
Spinoff process and give you a better understanding of CamCap. We also have
included cross-references in the Summary to other portions of the document where
you will find more detailed information about these matters. We encourage you to
read the entire document.
QUESTIONS AND ANSWERS ABOUT THE SPINOFF OF CAMCAP STOCK
Q: Why do the Spinoff?
A: We determined that the Spinoff was in the best interest of
Cambridge's shareholders because of the attractiveness of a public reporting
company as a merger partner or acquisition vehicle.
Q: How could I benefit from the Spinoff?
A: Direct investments in two entities. The Spinoff will give you a
direct investment in Cambridge, as well as direct investment in CamCap.
Q: What do I have to do to participate in the Spinoff?
A: Nothing. No proxy or vote is necessary for the Spinoff. If you own
Cambridge common stock at the close of business (5:00 p.m. EST) on November
____, 2000, which is the record date for the Spinoff, one share of CamCap common
stock will be credited to your brokerage account, or certificates representing
shares of CamCap common stock will be mailed to you on the Spinoff Date, which
will be on or about November ____, 2000. You do not need to mail in any
certificates of Cambridge common stock to receive stock certificates
representing CamCap common stock.
Q: When will the Spinoff happen?
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A: November ____, 2000. We will distribute all of the shares of CamCap
common stock on the Spinoff Date, which will be on or about November ___, 2000.
Q: How many CamCap shares will I receive in the Spinoff?
A: You will receive one share of CamCap common stock for every share of
Cambridge common stock that you own at the close of business on the record date.
Example: If you own 1,000 shares of Cambridge common stock as
of the close of business on November ___, 2000, you will receive 1,000 shares of
CamCap common stock in the Spinoff.
Q: Will CamCap's shares be listed on an exchange?
A: No. CamCap stock will not be listed on any exchange or traded on The
Nasdaq Stock Market. Regular trading in the CamCap common stock is not expected
to occur unless and until CamCap is successful in identifying a merger or
acquisition candidate.
Q: What are the tax consequences of the Spinoff to Cambridge's
shareholders?
A: The distribution of the CamCap stock will be taxable to Cambridge
shareholders for federal income tax purposes. However, because CamCap's total
assets are less than $3,000, the taxable amount will be nominal.
Q: Is an investment in CamCap stock subject to risk?
A: An investment in CamCap common stock involves a high degree of risk.
CamCap has recently organized and has no operating history or revenue which
would permit you to judge the probability of CamCap's success. CamCap has no
operating capital, no full time management team to conduct a complete
investigation and analysis of prospective merger or acquisition candidates and
may encounter substantial competition in its search for a business combination.
These and other factors are described in greater detail in the "Risk Factors"
section beginning on page 6.
Q: Will Cambridge and CamCap be related after the Spinoff?
A: Cambridge will not own any CamCap common stock after the Spinoff.
Cambridge and CamCap will be separate, publicly owned companies. As one
shareholder, Gregory Pusey, controls a majority of the voting rights of the
stock of Cambridge and the Spinoff would be through a pro rata distribution of
CamCap stock to shareholders of Cambridge, Mr. Pusey will control a majority of
the voting rights of the stock of both Cambridge and CamCap. Mr. Pusey will also
serve as the Chairman of the Board of Directors and President of both companies.
For further information, see the sections "Management" and "Principal
Shareholders" beginning on pages 16 and 18, respectively.
Q: What will Cambridge look like after the Spinoff?
A: After the Spinoff, Cambridge will continue its regular business
activities, which have been concentrated in the real estate industry. We expect
to continue these activities, as well as pursue other business opportunities.
This may include acquisition or merger possibilities, so that a
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conflict of interest could exist between Cambridge and CamCap. For further
information, see Risk Factors relating to conflicts of interest on pages 7 and
8.
SUMMARY OF FINANCIAL INFORMATION
The table below contains certain historical financial data of CamCap.
Historical financial data has been derived from the audited financial statements
of CamCap which are included in this Prospectus.
Income Statement (for the period from inception (August 17, 2000) to September
12, 2000):
<TABLE>
<S> <C>
Revenue $ -0-
Expenses $ 825
Net Loss $ (825)
Basic Loss Per Share $ (825)
Basic Number of Common Shares Outstanding 3,029,870
Balance Sheet (at September 12, 2000):
Total Assets $ 3,030
Total Liabilities $ 825
Total Shareholders Equity $ 2,205
</TABLE>
FORWARD-LOOKING STATEMENTS
This document includes forward-looking statements and information that
are based on the beliefs, plans, expectations and assumptions of Cambridge and
CamCap and on information currently available to these entities. The words
"may," "should," "expect," "anticipate," "intend," "plan," "continue,"
"believe," "seek," "estimate" and similar expressions used in this document are
intended to identify forward-looking statements. The forward-looking statements
in this document involve certain risks, uncertainties and assumptions. Many of
these factors are beyond the ability of Cambridge or CamCap to control or
predict. As a result, the future actions, financial condition and results of
operations could differ materially from those expressed in any forward-looking
statements.
Factors that could cause actual results to differ materially include,
but are not limited to, changes in general economic and business conditions,
CamCap's ability to identify a suitable merger or acquisition candidate, and the
ability to obtain additional financing. See also the facts described under the
section "Risk Factors" beginning on page 6.
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CamCap does not intend to update publicly any forward-looking
statements, whether as a result of new information, future events or otherwise.
All subsequent written and oral forward-looking statements attributable to
Cambridge or CamCap, or persons acting on behalf of any of them, are expressly
qualified in their entirety by these cautionary statements.
RISK FACTORS
CamCap Has No Operating History Or Revenue Which Would Permit You To Judge The
Probability Of CamCap's Success
CamCap has no operating history nor any revenues from operations since its
recent incorporation. CamCap has no significant assets or financial resources.
CamCap's lack of operating history makes it very difficult for you to judge the
probability of CamCap's success based upon managerial skill or ability to
successfully complete a merger with an acquisition candidate. As CamCap's
business purpose is to identify and complete a merger or acquisition with a
private entity, we do not expect that any revenues or earnings from operations
of CamCap will be generated in the near future. Instead, CamCap will, in all
likelihood, continue to sustain operating expenses without corresponding
revenues, at least until the consummation of a merger or acquisition.
Accordingly, we expect that CamCap will incur a net operating loss which will
increase continuously until CamCap can consummate a business combination with a
profitable business opportunity. We have no assurance that CamCap can identify
such a business opportunity or consummate such a business combination.
CamCap Has No Funds And Is Not Raising Any Money In Connection With The Spinoff
As of September 12, 2000, CamCap had $3,030 in assets and liabilities of $825.
The nominal amount of capital contributed by us has been used exclusively for
organizational purposes. CamCap has no plans to obtain additional financing from
outside sources. There is no obligation or commitment from us to provide further
capital to insure that CamCap continues as a going concern. However, it is
anticipated that we will continue to support CamCap in the form of loans in
amounts sufficient to cover operating costs and professional fees as needed to
keep CamCap current with its SEC reporting requirements.
CamCap Has Limited Funds And Does Not Intend To Hire A Full-Time Management Team
That Can Conduct A Complete Investigation And Analysis Of A Merger Or
Acquisition Candidate. CamCap May Not Find A Suitable Candidate
CamCap does not have funds to hire skilled managers. Management of CamCap will
have limited time to complete a full investigation of potential acquisition
candidates. As a result, CamCap may make a poor decision of the business it
acquires or it may be unable to identify any acquisition candidate.
We Expect That CamCap Will Encounter Substantial Competition For A Merger
Candidate
We expect that CamCap will be an insignificant participant in the business of
seeking mergers and acquisitions of small private entities. A large number of
established and well financed entities, including venture capital groups, are
active in mergers and acquisitions of companies which may be desirable target
candidates for CamCap. Nearly all such entities have significantly greater
financial
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resources, technical expertise and managerial capabilities than CamCap and,
consequently, CamCap may be expected to be at a competitive disadvantage in
identifying possible merger candidates and successfully completing a business
combination. In addition, CamCap will also compete in seeking merger or
acquisition candidates with numerous other small public companies.
We Have No Agreements For A Business Combination And We Have Not Established Any
Particular Standards For A Business Combination
We do not have any arrangement, agreement or understanding with respect to
engaging in a merger with, or acquisition of, any entity. We cannot assure you
that CamCap will be successful in identifying and evaluating suitable merger
candidates or in concluding a business combination. We have not identified any
particular industry or specific business within an industry for evaluation by
CamCap. We have not established a specific length of operating history or a
specified level of earnings, assets, net worth or other criteria which CamCap
will require a target merger candidate to have achieved, and without which
CamCap would consider a merger. It is possible that CamCap may enter into a
merger with, or acquire a company with no significant operating history, limited
assets, losses, negative net worth or other negative characteristics. We expect
that CamCap will be able to complete only one merger or acquisition. This lack
of diversification may adversely affect the prospects for success.
CamCap's proposed operations, even if successful, will in all likelihood result
in CamCap engaging in one merger or acquisition. Consequently, CamCap's
activities may be limited to those engaged in by the target company with which
CamCap merges or acquires. CamCap's inability to diversify its activities into a
number of areas may subject CamCap to economic fluctuations within a particular
business or industry and increase the risks associated with CamCap's operations.
The Search For A Merger Candidate Will Be Conducted Principally By The President
Of CamCap, Who Is Engaged In Other Business Activities And Will Have Limited
Time Availability
Gregory Pusey, who is our President, as well as the President of CamCap, will be
the only individual responsible for conducting the day to day operations of
CamCap, including searches, evaluations, and negotiations with potential merger
or acquisition candidates. In addition to his responsibilities with us and
CamCap, Mr. Pusey is also Chairman of the Board of Directors of Advanced
Nutraceuticals, Inc., a publicly held company engaged in the manufacture and
distribution of nutritional supplements, pharmaceuticals and other products. It
is currently anticipated that Mr. Pusey will devote up to ten hours per month to
the business of CamCap. CamCap has not entered into any written employment
agreement with Mr. Pusey and is not expected to do so in the foreseeable future.
CamCap has not obtained key man life insurance on Mr. Pusey and the loss of the
services of Mr. Pusey could adversely affect development of CamCap's business
and its likelihood of continuing operations.
Mr. Pusey May Participate In Business Ventures Which Could Be Deemed To Compete
Directly With CamCap
Gregory Pusey will not be a full-time employee of CamCap. After the Spinoff, Mr.
Pusey will continue as our President, and we do not plan to limit our
prospective activities to real estate projects. Accordingly, we may seek merger
and acquisition candidates. In addition, Mr. Pusey serves as Chairman of the
Board of Directors of Advanced Nutraceuticals, Inc. Although Advanced
Nutraceuticals, Inc.'s business activities are concentrated in the manufacture
and distribution of
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nutritional supplements and pharmaceutical products, it may engage in merger and
acquisition activities and conflicts of interest situations could develop. Mr.
Pusey has also served as a consultant to Applied Medical Devices, Inc., a
publicly held company which recently entered into a letter of intent to merge
with a private entity. Mr. Pusey is also engaged in independent investment
activities through Livingston Capital, Ltd. Additional conflicts of interest and
non-arms length transactions may also arise in the future in the event CamCap's
future officers or directors are involved in the management of any firm with
which CamCap transacts business. CamCap has adopted a policy that it will not
seek a merger with, or acquisition of, any entity in which its management serves
as officers, directors or partners, or in which they or their family members own
or hold any ownership interest. It is not expected that Mr. Pusey will receive
any salary for his services as President of CamCap and in conducting the day to
day operations of CamCap and its search for a merger candidate. Instead, it is
expected that, if CamCap is successful in completing a merger or acquisition,
Mr. Pusey would receive additional shares of stock of CamCap, a cash bonus, or
some other form of compensation. Management has adopted a policy that CamCap's
officers and directors, including Mr. Pusey, may receive not more than 9.9% of
the value of any merger or acquisition completed by CamCap as compensation in
connection with the transaction.
We Expect That There Will Be A Change In Control Or Management Of CamCap After A
Merger
A merger or acquisition will, in all likelihood, involve the issuance of
CamCap's common stock and result in shareholders of the target private company
obtaining a controlling interest in CamCap. Any such business combination may
require management of CamCap to sell or transfer all or a portion of the CamCap
shares held by them. In addition, CamCap officers and directors may be forced or
requested to resign their positions in order for new management to be appointed.
The resulting change in control of CamCap could result in the removal of Gregory
Pusey and a corresponding reduction in or elimination of his participation in
the future affairs of CamCap.
We Expect That Your Percentage Share Ownership In CamCap Following Any Merger Or
Acquisition Will Be Substantially Reduced
CamCap's business plan is to identify and complete a merger or acquisition with
a private entity. Although CamCap has not identified any particular candidate,
and no terms have been negotiated or established, it is likely that a
substantial number of shares of CamCap stock will be issued to the shareholders
of the merger candidate. CamCap has authorized 50,000,000 shares of common stock
and 1,000,000 shares of preferred stock. There are currently 3,029,870 shares of
CamCap common stock outstanding, all of which are owned by us. After the
Spinoff, there will remain 3,029,870 shares of CamCap stock which will be owned
by our shareholders. In addition, 500,000 shares have been reserved for issuance
pursuant to the 2000 Stock Incentive Plan. Therefore, there will remain
46,470,130 shares of common stock and 1,000,000 shares of preferred stock
available for issuance. Terms of any merger or acquisition may require the
issuance of all or substantially all of the shares to the shareholders of the
private entity involved in the merger or acquisition with CamCap. The issuance
of previously authorized and unissued shares of CamCap would result in reduction
in percentage of shares owned by the persons who will receive CamCap shares in
the Spinoff. It is likely that this reduction will be substantial and that there
will be a change in control of CamCap.
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The Requirement Of Audited Financial Statements May Disqualify Business
Opportunities
CamCap will be a publicly reporting company under the federal
securities laws. Accordingly, CamCap will be required to provide certain
information about significant acquisitions, including audited financial
statements for the company acquired, covering two or three years, depending on
the relative size of the acquisition. The time and additional costs that may be
incurred by some target entities to prepare such statements may preclude
consummation of an otherwise desirable acquisition by CamCap. Acquisition
prospects that do not have or are unable to obtain the required audited
financial statements may not be appropriate for acquisition so long as the
reporting requirements are applicable.
We Expect That Tax Consequences Will Be Considered In Any Potential Acquisition
As a general rule, federal and state tax laws and regulations have a significant
impact upon the structuring of business combinations. CamCap expects to evaluate
the possible tax consequences of any prospective business combination. We expect
that any transaction will be structured so as to minimize the federal and state
tax consequences to both CamCap and the target entity. However, even if this
occurs, there can be no assurance that the Internal Revenue Service or
appropriate state tax authorities would ultimately assent to CamCap's tax
treatment of a consummated business combination. To the extent the Internal
Revenue Service or state tax authorities ultimately prevail in re-characterizing
the tax treatment of a business combination, there could be adverse tax
consequences to CamCap, the acquisition candidate and their respective
shareholders.
We Do Not Expect Any Trading Market To Develop In CamCap Stock Until A Business
Combination Is Completed And There Will Be Significant Restrictions On Resale Of
The CamCap Common Stock
We do not expect to undertake any efforts to establish a trading market in the
CamCap common stock in the near future. We do not expect to apply for a listing
on any exchange, the Nasdaq Stock Market, or the Electronic Bulletin Board
system operated by Nasdaq, and we do not expect any trading market to develop
until after a business combination has been identified. Moreover, a significant
number of states have enacted regulations pursuant to their securities or
so-called "blue sky" laws restricting or, in many instances, prohibiting, the
sale of securities of companies such as CamCap which have no business operations
other than the search for a merger or acquisition candidate. To ensure that any
state laws are not violated, CamCap will refuse to register the transfer of any
of its common stock to residents of any state which prohibit such sale or if no
exemption is available for such sale.
In a recent "no action" letter, the Office of Small Business of the SEC,
expressed the view that SEC Rule 144 is not available for resale transactions
involving securities sold by promoters and affiliates of a "blank check" company
and their transferees, and anyone else who has been issued securities from a
blank check company, and that securities issued by a blank check company to
promoters and affiliates, and their transferees, can only be resold through
registration. In addition, the promoters or affiliates of the blank check
companies, as well as their transferees, are deemed to be "underwriters" of the
securities issued both before and after any business combination. The Company
anticipates that it will amend this Registration Statement to keep it "current"
or file a new registration statement in connection with a business combination.
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THE SPINOFF
Reasons For The Spinoff
Our Board of Directors has determined that the Spinoff is in the best interest
of shareholders of Cambridge. We believe our shareholder value may be enhanced
by the Spinoff due to the attractiveness of a public reporting company as a
merger partner or acquisition vehicle.
CamCap was formed to identify and complete a merger or acquisition with a
private entity. A private entity may attempt to avoid what it deems to be
adverse consequences of undertaking its own public offering by seeking a
business combination with CamCap. Such adverse consequences may include time
delays of the registration process, significant expenses incurred in a public
offering, and loss of voting control to public shareholders.
Manner Of Effecting The Spinoff
We will effect the Spinoff by delivering all of the outstanding shares of CamCap
common stock to Corporate Stock Transfer, Inc. which will serve as the
Distribution Agent. The Distribution Agent will be instructed by Cambridge to
distribute the CamCap shares to the holders of record of Cambridge common stock
as of the close of business (5:00 P.M. EST) on the Record Date of November ____,
2000.
The distribution of CamCap common stock will be made on the basis of a
distribution ratio of one share of CamCap common stock for each share of common
stock of Cambridge held as of the close of business on the Record Date. There
are currently 3,029,870 shares of CamCap common stock outstanding, all of which
are owned by Cambridge. All 3,029,870 shares of CamCap common stock will be
distributed by Cambridge to Cambridge's shareholders. The Distribution Agent
will credit the brokerage accounts of Cambridge shareholders, or will mail
CamCap certificates to Cambridge shareholders, on or about November ____, 2000
(the "Spinoff Date"). The shares of CamCap common stock will be fully paid and
non-assessable and the holders thereof will not be entitled to pre-emptive
rights.
No holder of common stock of Cambridge will be required to pay any cash or other
consideration for shares of CamCap common stock received in the Spinoff or to
exchange shares of Cambridge common stock. On and after the Spinoff Date,
certificates for shares of common stock of Cambridge will represent the same
shares of Cambridge. You will not receive new stock certificates for Cambridge
common stock as a result of the Spinoff.
Effect Of A Spinoff
Following the Spinoff, which will be effective at 5:00 P.M. EST on the Spinoff
Date, Cambridge and CamCap will be separate public companies. The number and
identity of shareholders of CamCap immediately after the Spinoff generally will
be the same as the number and identity of shareholders of Cambridge on the
Record Date. Immediately after the Spinoff, CamCap expects to have approximately
990 holders of record of CamCap common stock and 3,029,870 shares of CamCap
common stock outstanding, based on the one-to-one distribution ratio of the
Spinoff and the number of record shareholders and outstanding shares of
Cambridge common stock as of the date of this Prospectus. The actual number of
shares of CamCap common stock to be distributed will be determined as of the
Record Date.
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Certain United States Federal Income Tax Consequences
The following is a discussion of the material federal income tax consequences of
the Spinoff and does not purport to be a complete analysis or description of all
potential tax effects of the Spinoff. The discussion does not address all the
tax consequences that may be relevant to particular shareholders in light of
their personal circumstances or to taxpayers subject to special treatment under
the federal income tax laws (for example, insurance companies, financial
institutions, broker-dealers, tax-exempt organizations, foreign corporation,
foreign partnerships or other foreign entities, and individuals who are not
citizens or residents of the Unite States), and does not address any aspects of
state, local or foreign tax law. The following discussion is based upon the
provisions of the Internal Revenue Code, the U.S. Treasury Regulations
thereunder, and administrative rulings and judicial decisions in effect as of
the date of this Prospectus. Subsequent legislative, administrative or judicial
changes or interpretations could affect the accuracy of the statements or
conclusions set forth in this Prospectus. Any such change could apply
retroactively. Each shareholder of Cambridge is urged to consult his or her own
tax advisor as to the federal, state, local or foreign tax consequences of the
Spinoff.
The Spinoff does not constitute a tax-free distribution. Instead, each holder of
Cambridge stock who receive shares of CamCap common stock in the Spinoff will be
treated as if such shareholder received a taxable distribution. However,
inasmuch as CamCap's total assets are less than $3,100, and its liabilities are
$825, the taxable amount will be nominal.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan Of Operation
CamCap is a development stage company organized on August 17, 2000, in the State
of Colorado, to identify and complete a merger or acquisition with a private
entity. CamCap's plan of operation for the coming year is to fulfill this
business plan. CamCap has limited financial resources and competition for
suitable merger candidates is substantial. Accordingly, there can be no
assurance that CamCap's business plans will be fully realized.
CamCap does not plan to limit its options to any particular industry, but
expects to evaluate each opportunity on its merits. CamCap anticipates that
Cambridge will provide it with sufficient capital to continue operations through
its first fiscal year ending June 30, 2001.
Results Of Operations
CamCap had no revenue from operations from inception (August 17, 2000), through
the period ended September 12, 2000.
General and administrative expenses for the period ended September 12, 2000 were
$825. General and administrative expenses during this period consisted solely of
organizational expenses.
CamCap had a net loss of $825 for the period ended September 12, 2000. CamCap's
net losses during this period were attributable to general and administrative
expenses.
CamCap does not expect to generate any revenue until it acquires an interest in
an operating company.
-11-
<PAGE> 15
Liquidity And Capital Resources
As of September 12, 2000, CamCap had no major assets. CamCap is currently
authorized to issue 50,000,000 shares of common stock, of which 3,029,870 shares
are issued and outstanding, and 1,000,000 shares of preferred stock, none of
which is outstanding as of September 12, 2000. Management is hopeful that if
CamCap becomes a reporting company it will increase the number of prospective
business ventures that may be available to CamCap. Management believes that
CamCap has sufficient resources to meet the anticipated needs of CamCap's
operations through at least the fiscal year ending June 30, 2001. CamCap
anticipates that Cambridge will advance sufficient funds to satisfy the cash
needs of CamCap through the fiscal year ending June 30, 2001. However, there can
be no assurances to that effect, as CamCap has no revenues and CamCap's need for
capital may change dramatically if it acquires an interest in an operating
entity. Further, CamCap has no plans to raise additional capital through private
placements or public registration of its securities until a merger or
acquisition candidate is identified. We believe that, in view of the SEC's
position that SEC Rule 144 is not available for resale transactions of blank
check companies, efforts to raise additional capital would likely not be
successful. However, CamCap may attempt to raise additional capital.
CamCap projects that its operating requirements will not exceed $15,000 during
the fiscal year ending June 30, 2001. However, if an acquisition candidate is
identified, substantial additional costs in the due diligence and evaluation
process may be incurred. If the acquisition is consummated, there will be
substantial additional costs, primarily related to professional fees. It is
expected that funding will be advanced to CamCap by Cambridge, and that
Cambridge would be reimbursed if the merger or acquisition is concluded.
BUSINESS
Introduction
CamCap was formed as a Colorado corporation on August 17, 2000 to identify and
complete a merger or acquisition with a private entity whose business presents
an opportunity for CamCap shareholders. CamCap has been in the developmental
stage since inception and has not engaged in any operational activities, other
than organizational measures, including issuing all of its shares to Cambridge.
CamCap may be considered a "development stage" or "shell" company inasmuch as it
has limited financial resources, and its planned activities consist solely of
seeking to identify and complete a merger or acquisition with a private entity
for which no revenues would be generated.
Our management decided to file the Registration Statement of which this
Prospectus is a part on a voluntary basis as management believes that the
primary attraction of CamCap as a merger partner or acquisition vehicle will be
its status as a public reporting company.
Business Plan
Our purpose is for CamCap to acquire an interest in a business which seeks the
perceived advantages of a publicly reporting company. We do not expect to
restrict our search to any specific business or industry. However, because of
CamCap's limited financial resources, it is expected that CamCap will be able to
participate in only one merger or acquisition transaction.
-12-
<PAGE> 16
CamCap's management will review and evaluate business entities for possible
mergers or acquisitions. CamCap has not yet entered into any agreement, nor does
it have any commitment or understanding to enter into or become engaged in a
transaction as of the date of this Prospectus. CamCap's business objectives
discussed in this Prospectus are extremely general and are not intended to
restrict the discretion of CamCap's management.
A decision to participate in a specific business opportunity will be made based
upon an analysis of many factors which may be difficult, if not impossible, to
analyze using any objective criteria.
The analysis of merger candidates will be undertaken by Gregory Pusey who is not
a professional business analyst. In analyzing prospective business
opportunities, management will consider the following regarding a prospective
merger candidate:
o The background, experience and quality of management;
o Technical, financial and managerial resources;
o Depth of personnel;
o History of operations, if any;
o The availability of audited financial statements to meet SEC
requirements;
o Working capital and other financial requirements;
o The potential for future financing;
o The competitive position of products and the nature of present and
expected competition;
o The potential for further research, development, exploration or
expansion of markets;
o The merit of the business plan;
o Results of a due diligence evaluation; and
o Other relevant factors.
Selection Of A Merger Candidate
We anticipate that potential merger candidates will be referred from various
sources, including our management, professional advisors, venture capitalists,
investment firms and other persons involved in the financial community, and
other persons who may present unsolicited proposals. It is not anticipated that
CamCap will engage in any general solicitation or advertising for a merger
candidate, but instead will rely on the personal contacts of its officers and
directors and their affiliates, as well as indirect associations with other
business and professional people. Management's reliance on "word of mouth" may
limit the number of potential business opportunities identified. It is not
anticipated that CamCap will engage firms specializing in business acquisitions,
but such firms may be retained if management believes that is advisable. Finders
fees paid could involve cash payments, payments involving issuance of
securities, payments based on a percentage of the merger candidate's
-13-
<PAGE> 17
revenues, or any combination of these or other compensation arrangements.
Consequently, we are unable to predict the cost of utilizing such services.
CamCap has no commitments, agreements, arrangements or understandings to pay any
finders fees in connection with any potential acquisition or merger.
CamCap will not restrict its search to any particular business, industry or
geographical location. The decision of management is expected to be based on the
business objective of seeking long-term capital appreciation for CamCap's
shareholders. CamCap may participate in a merger with a newly organized business
venture or with a more established business. Participation in a new business
venture entails greater risks as, in many instances, management of such venture
may not have a proven track record; the eventual market for the product or
services will likely not be established; and the profitability will be untested
and impossible to accurately forecast. Should CamCap participate in a more
established venture that is experiencing financial difficulty, risks may stem
from CamCap's inability to generate sufficient funds to manage or reverse the
circumstances causing the financial problems.
It is expected that the management of CamCap will analyze all relevant factors
and make a determination based on a composite of available information, without
reliance on any single factor. As no specific merger or acquisition candidate
has been identified, we cannot describe the primary factors relied upon in
making an acquisition decision. In addition, the period within which CamCap will
decide to participate in a merger or acquisition transaction cannot be predicted
and will depend on certain factors, including the time involved in identifying
businesses, the time required for CamCap to complete its due diligence and
analysis, the time required to prepare appropriate documentation to effect a
merger or acquisition and other circumstances.
How An Acquisition May Be Structured
Although the exact structure of an anticipated business transaction cannot yet
be determined, we anticipate that CamCap will become a party to a merger,
consolidation, share exchange or other form of business combination. It is
probable that the present management of CamCap and CamCap's shareholders will no
longer be in control of CamCap upon completion of the business combination.
CamCap's directors may, as part of the terms of the acquisition transaction,
resign and be replaced by new directors without a vote of the CamCap
shareholders. It is possible that the merger candidate may require some of
CamCap's larger shareholders, including Mr. Pusey, to sell their stock in CamCap
as part of the merger transaction. Management does not intend to require the
purchase of all or any portion of its stock as a condition to any proposed
merger or acquisition. However, it is not unusual for affiliates of the entity
participating in the merger to negotiate to purchase shares held by the present
shareholders. This is done in order to reduce the amount of shares held by
persons no longer affiliated with the public entity and thereby reduce the
potential adverse impact on the public market in the common stock that could
result from substantial sales of such shares after the completion of the merger.
In the event sales of shares by management is a negotiated part of a future
merger or acquisition, a conflict of interest could arise as management would be
negotiating for the merger or acquisition on behalf of CamCap and for the sale
of their shares for their own personal accounts. Management has not adopted any
policy resolving the potential conflict, should it arise, but instead intends to
rely on its obligation to fulfill its duties to act in the best interest of
CamCap and its shareholders in making any determinations with respect to the
sale of their shares. While the actual terms of a transaction to which CamCap
may be a party cannot be determined at this time, it is expected that the
parties to any business transaction will find it
-14-
<PAGE> 18
desirable to structure the merger or acquisition as a so-called "tax free"
event. The Company expects to be the acquiring corporation in a business
combination as it will be the public entity. However, it is likely that CamCap
would issue securities in such an amount that the shareholders of the acquired
corporation would hold a majority, and possibly substantially all, of the voting
stock of CamCap after the acquisition is completed. Consequently, the
shareholders of Cambridge who will receive the CamCap stock in the Spinoff would
retain less than 50% of the issued and outstanding shares of CamCap after CamCap
completes an acquisition or merger. Regardless of the form of business
acquisition it may be anticipated that the CamCap shareholders immediately prior
to the transaction will experience a significant reduction in their percentage
of ownership in CamCap.
Although it is anticipated that CamCap would be the acquiring corporation in a
business combination, the transaction would typically be accounted for under
generally accepted accounting principles as if CamCap had been acquired by the
other entity owning the business. Under those principles, CamCap would not be
permitted a write-up in the carrying value of the assets of the other company.
The determination of the terms of the merger will depend on various factors,
including the nature of the business to be acquired, the respective needs and
desires of CamCap and the other parties, the management of the business to be
acquired, and the relative negotiating strength of CamCap and the management of
the business being acquired.
It is expected that CamCap will participate in a transaction only after the
negotiation and execution of appropriate written agreements. Although the terms
of such agreements cannot be determined at this time, generally such agreements
will require specific representations and warranties by the parties, will
specify certain events of default, will detail the terms of closing and the
conditions which must be satisfied by the parties prior to the closing, and will
set forth events of default and other terms.
Operation Of Business After Acquisition
The operation of CamCap following its merger or acquisition of a business will
be dependent on the nature of the business and the interest acquired. We are
unable to determine at this time whether management of CamCap will participate
in management of the business after the acquisition, but it is likely that the
present management of CamCap will not be in control of CamCap following the
acquisition. It may be expected that the business will present various risks,
which cannot be predicted at the present time.
Government Regulation
We cannot anticipate governmental regulations, if any, to which CamCap may be
subject until it has acquired an interest in a business. The use of assets to
conduct a business which CamCap may acquire could subject it to environmental,
public health and safety, land use, trade, or other governmental regulations and
state or local taxation. In selecting a business as a merger candidate,
management will endeavor to ascertain, to the extent of the limited resources of
CamCap, the effects of such government regulation on the prospective business.
Under certain circumstances, however, such as the acquisition of an interest in
a new or start-up business activity, it may not be possible to predict with any
degree of accuracy the impact of government regulation. The inability to
ascertain the effect of government regulation on a prospective business activity
will make the acquisition in such business a higher risk.
-15-
<PAGE> 19
Competition
CamCap will be an insignificant participant among the firms that engage in the
acquisition of businesses. There are many established venture capital groups and
financial concerns that have significantly greater financial and personnel
resources and technical expertise than CamCap. In view of our limited financial
resources and limited management availability, CamCap will be at a significant
competitive disadvantage.
Employees
CamCap is a development stage company and has no employees. Management will
devote only such time to the affairs of CamCap as they deem appropriate. It is
estimated that Mr. Pusey will conduct the day to day operations of CamCap and
will devote up to ten hours per month to these activities. Management expects to
use consultants, attorneys, and accountants as necessary, and does not
anticipate a need to engage any full-time employees so long as CamCap is
identifying and evaluating businesses. The need for employees and their
availability will be addressed in connection with the decision of whether to
acquire or participate in a specific acquisition transaction.
Description Of Property
CamCap has no properties and at this time has no agreements to acquire any
properties. We will operate from offices made available to us on a rent free
basis from CamCap's President. This space is provided on a rent free basis and
it is anticipated that this arrangement will remain until CamCap successfully
consummates a merger or acquisition. If administrative personnel are shared with
the Company's President, such expenses will be allocated on a proportionate
basis. It is not anticipated that such expenses will be substantial.
MANAGEMENT
Our directors and officers are as follows:
<TABLE>
<CAPTION>
Name Age Position
---- --- --------
<S> <C> <C>
Gregory Pusey 48 President, Treasurer and Director
Jeffrey G. McGonegal 49 Secretary and Director
John H. Altshuler 69 Director
Scott Menefee 35 Director
</TABLE>
The directors of the Corporation serve until the next Annual Meeting of
Shareholders or until the election of their successors. Vacancies in the Board
of Directors are filled by majority vote of the remaining directors. The
officers serve at the will of the Board of Directors. There are no family
relationships among the directors of CamCap.
The following is biographical information concerning the officers and directors
of CamCap.
GREGORY PUSEY serves as the President, Treasurer and a director of Cambridge,
and has served as a director of Cambridge since 1982. He is the President and
Chairman of the Board of Directors of
-16-
<PAGE> 20
Advanced Nutraceuticals, Inc., a publicly held company engaged in the
manufacture and distribution of nutritional supplements and pharmaceutical
products. He is also engaged in independent investment activities through
Livingston Capital, Ltd.
JOHN H. ALTSHULER, M.D. has served as a director of Cambridge since 1991. He
maintains a laboratory and a private medical practice and has served as a
medical consultant since 1965. Dr. Altshuler's medical specialty is hematology.
Dr. Altshuler graduated from McGill University in 1959 with a doctorate in
medicine.
JEFFREY G. MCGONEGAL became the Secretary and a director of Cambridge in
September 2000. Mr. McGonegal has served as Senior Vice President - Finance of
Advanced Nutraceuticals, Inc. since February 2000. Since 1997, Mr. McGonegal has
served as Managing Director of McGonegal and Company, a company engaged in
providing accounting and business consulting services. From 1974 to 1997, Mr.
McGonegal was an accountant with BDO Seidman LLP. While at BDO Seidman LLP, Mr.
McGonegal served as managing partner of the Denver, Colorado office. Mr.
McGonegal is a member of the Board of Directors of The Rockies Venture Club,
Inc. and Colorado Venture Centers, Inc. He received a B.A. degree in accounting
from Florida State University.
SCOTT MENEFEE has served as a director of Cambridge since 1993. He is a real
estate manager for Opus Northwest, LLC, a large commercial real estate
development firm. He previously served as a Leasing Manager for Vector Property
Services, LLC. From 1992 through early 1997, Mr. Menefee was a Leasing Manager
for Brookfield Development. Mr. Menefee graduated from Southern Methodist
University with a MBA degree in 1989.
Compensation
No compensation was paid to any of CamCap's officers and directors since
CamCap's inception on August 17, 2000. It is not expected that any salaries will
be paid to any of CamCap's officers and directors, although there is currently
no policy in place that prevents the Company from compensating these persons or
any future officer, director or affiliate.
CamCap has no agreement or understanding with any officer, director, or
principal shareholder, or their affiliates or associates, regarding employment
with CamCap or compensation for services. CamCap has not made a determination of
whether any officer, director, or principal shareholder, or their affiliates or
associates, will receive any compensation for any services provided to CamCap in
fulfilling CamCap's business objective of identifying and completing a merger or
acquisition with a private entity. CamCap has adopted a policy that its officers
and directors will not receive more than 9.9% of the value of any merger or
acquisition completed by CamCap as compensation in connection with the
transaction.
Upon the merger or acquisition of a business entity, it is possible that current
management of CamCap will resign and be replaced by persons associated with the
business acquired. In the event that any member of current management remains
after effecting a business acquisition, that member's time commitment and
compensation will likely be adjusted based on the nature and location of such
business and the services required, which cannot now be foreseen.
In August 2000, CamCap adopted its 2000 Stock Incentive Plan. The purpose of the
Plan is to promote the interests of CamCap and its shareholders by providing
participants a significant stake in the performance of CamCap and providing an
opportunity for the participants to increase their
-17-
<PAGE> 21
holdings of CamCap's common stock. The Plan is administered by the Option
Committee, which consists of the Board or a committee of the Board, as the Board
may from time to time designate, composed of not less than two members of the
Board, each of whom shall be a director who is not employed by CamCap. The
Option Committee has the authority to select employees and consultants (which
may include directors) to receive awards, to determine the number of shares of
common stock covered by awards, and to set the terms and conditions of awards.
The Plan authorizes the grant of options to purchase up to 500,000 shares of
CamCap's common stock. No options have been granted under the Plan. In addition
to stock options, CamCap may also offer a participant a right to purchase shares
of common stock subject to such restrictions and conditions as the Option
Committee may determine at the time of grant. Such conditions may include
continued services to CamCap or the achievement of specified performance goals
or objectives. No common stock has been issued pursuant to the Plan.
PRINCIPAL SHAREHOLDERS
All of the outstanding CamCap stock is currently held by Cambridge. The
following table sets forth projected CamCap stock ownership information with
respect to each of the CamCap directors and to all CamCap directors and
executive officers as a group, and with respect to each person who is projected
to own more than 5% of the CamCap stock immediately after the distribution.
<TABLE>
<CAPTION>
Percent of
Name and Address Number of Shares Shares Outstanding
---------------- ---------------- ------------------
<S> <C> <C>
John H. Altshuler
18 Blue Heron Drive West -0- .0
Littleton, Colorado 80121
Jeffrey G. McGonegal -0- .0
1905 West Valley Vista Drive
Castle Rock, Colorado 80104
Scott Menefee
971 Garfield Street 40,000 1.3
Denver, Colorado 80206
Gregory Pusey(1)
8101 East Dartmouth, #58 1,591,218 52.5
Denver, Colorado 80231
Cede & Co.
P. O. Box 222
New York, New York 10274 203,469 6.6
E. Jeffrey Peierls
73 South Holman Way 307,824 10.0
Golden, Colorado 80401
All Officers and Directors
As A Group (4 Persons) 1,631,218 53.8
</TABLE>
-18-
<PAGE> 22
(1) Includes 18,604 shares owned jointly by Mr. Pusey with his wife, and an
aggregate of 96,411 shares owned by Mrs. Pusey, individually or as
custodian for their minor children.
LEGAL PROCEEDINGS
There is no litigation pending or threatened against us or CamCap.
DESCRIPTION OF SECURITIES
CamCap is authorized to issue up to 50,000,000 shares of $.001 par value common
stock. Holders of shares of common stock are entitled to one vote per share on
all matters to be voted upon by shareholders generally, and are not entitled to
cumulate votes in the election of directors. Shareholders are entitled to
receive such dividends as may be declared from time to time by the Board of
Directors out of funds legally available therefor. CamCap has paid no dividends
to date, and CamCap has no plans to do so in the immediate future. In the event
of liquidation, dissolution, or winding up of CamCap, holders of shares of
common stock are entitled to share ratably in all assets remaining after payment
of liabilities and distribution to holders of preferred stock. The holders of
shares of common stock have no pre-emptive, conversion or subscription rights.
Shares of common stock currently outstanding are validly issued, fully paid and
non-assessable.
CamCap is also authorized to issue up to 1,000,000 shares of $.001 par value
preferred stock, which may be issued from time to time in one or more series.
The Board is allowed to fix or alter the dividend rights, the terms of
redemption and liquidation preferences of any unissued series of preferred stock
and may designate the number of shares constituting any such series. There are
no shares of preferred stock issued or outstanding, and CamCap has no plans to
authorize or issue any shares of preferred stock.
SHARES ELIGIBLE FOR FUTURE SALE
There is no public market for CamCap common stock, and it is not anticipated
that any public market will develop in the immediate future. After a merger
candidate has been identified, a public market may develop. It is expected that
any merger will involve an issuance of a substantial amount of CamCap stock to
shareholders of the acquired entity. Sales by these persons of the stock
acquired in the merger or acquisition transaction in any public market that may
develop may cause the CamCap share price to drop and may adversely affect the
sale of shares by our shareholders who have received CamCap stock in the
Spinoff.
LEGAL MATTERS
The validity of the shares offered under this Prospectus is being passed upon by
Patton Boggs LLP, Denver, Colorado.
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<PAGE> 23
EXPERTS
Financial statements included in this Prospectus and in the Registration
Statement have been included in reliance on reports of AJ. Robbins, PC,
independent certified public accountants, and upon their authority as experts in
accounting and auditing. The report of AJ. Robbins, PC contains an emphasis
paragraph questioning whether CamCap can continue as a going concern without
additional funding or financial support from Cambridge.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
Cambridge is (and, following the Spinoff, CamCap will be) subject to the
informational requirements of the Securities Exchange Act of 1934 and files (and
CamCap will file) annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any reports, statements or other information that either of us files with
the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. You may obtain information on the operation of the
Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an
Internet site that contains reports, proxy and information statements and other
information about issuers that file electronically with the SEC. The address of
the SEC's Internet site is http://www.sec.gov.
CamCap has filed with the SEC a Registration Statement on Form SB-2 under the
Securities Act of 1933 relating to CamCap's common stock to be issued to the
shareholders of Cambridge in the Spinoff. As permitted by the rules and
regulations of the SEC, this joint Information Statement/Prospectus does not
contain all the information set forth in the Registration Statement. You can
obtain that additional information from the SEC's principal office in
Washington, D.C. or the SEC's Internet site as described above. Statements
contained in this Joint Information Statement/Prospectus about the contents of
any document are not necessarily complete and, in each instance where the
document is filed as an exhibit to the Registration Statement, reference is made
to the copy of that document filed as an exhibit to the Registration Statement,
with each statement of that kind in this Joint Information Statement/Prospectus
being qualified in all respects by reference to the document.
We will provide a copy of any and all of the information that is referred to in
this Joint Information Statement/Prospectus to you, without charge, upon written
or oral request. You should make any request for documents at 7315 East Peakview
Avenue, Englewood, Colorado 80111 by October ___, 2000 to insure timely delivery
of the documents.
THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF AN
OFFER TO PURCHASE, THE CAMCAP COMMON STOCK IN ANY JURISDICTION TO OR FROM ANY
PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE THE OFFER OR SOLICITATION OF
AN OFFER IN THAT JURISDICTION. NEITHER THE DELIVERY OF THIS JOINT INFORMATION
STATEMENT/PROSPECTUS NOR ANY DISTRIBUTION OF SECURITIES MEANS, UNDER ANY
CIRCUMSTANCES, THAT THERE HAS BEEN NO CHANGE IN THE INFORMATION SET FORTH OR IN
OUR AFFAIRS SINCE THE DATE OF THIS JOINT INFORMATION STATEMENT/PROSPECTUS. NO
PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS
OTHER THAN THOSE CONTAINED IN THIS INFORMATION STATEMENT AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED.
-20-
<PAGE> 24
FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Independent Auditors' Report F-2
Financial Statements:
Balance Sheet F-3
Statement of Operations F-4
Statement of Changes in Stockholder's Equity F-5
Statement of Cash Flows F-6
Notes to Financial Statements F-7
</TABLE>
<PAGE> 25
INDEPENDENT AUDITORS' REPORT
TO THE BOARD OF DIRECTORS AND STOCKHOLDERS
CAMCAP, INC.
ENGLEWOOD, COLORADO
We have audited the accompanying balance sheet of CamCap, Inc. (a development
stage company) as of September 12, 2000, and the related statements of
operations, changes in stockholder's equity, and cash flows for the period from
August 17, 2000 (inception) to September 12, 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 CamCap, Inc. as of September
12, 2000, and the results of its operations and its cash flows for the period
from August 17, 2000 (inception) to September 12, 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 1 to the
financial statements, the Company is in the development stage and has not
commenced operations. Its ability to continue as a going concern is dependent
upon its ability to develop additional sources of capital, complete a merger or
acquisition of a private entity and ultimately achieve profitable operations.
These conditions raise substantial doubt about its ability to continue as a
going concern. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty.
DENVER, COLORADO
SEPTEMBER 20, 2000
F-2
<PAGE> 26
CAMCAP, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
SEPTEMBER 12, 2000
<TABLE>
<S> <C>
ASSETS
CURRENT ASSETS, Cash $ 3,030
=======
LIABILITIES AND STOCKHOLDER'S EQUITY
TOTAL LIABILITIES, Accounts payable $ 825
-------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDER'S EQUITY:
Preferred stock, $.001 par value, 1,000,000 shares
authorized --
Common stock, $.001 par value 50,000,000 shares
authorized, 3,029,870 shares issued and
outstanding 3,030
(Deficit) accumulated during the development stage (825)
-------
Total Stockholder's Equity 2,205
-------
$ 3,030
=======
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
F-3
<PAGE> 27
CAMCAP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
FOR THE PERIOD
FROM
AUGUST 17, 2000
(INCEPTION)
to
SEPTEMBER 12,
2000
---------------
<S> <C>
REVENUE $ --
----------
EXPENSES (825)
----------
NET (LOSS) $ (825)
==========
NET (LOSS) PER COMMON SHARE - BASIC $ *
==========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING - BASIC 3,029,870
==========
</TABLE>
*Less than $.01 per share
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
F-4
<PAGE> 28
CAMCAP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
FOR THE PERIOD FROM AUGUST 17, 2000 (INCEPTION) TO SEPTEMBER 12, 2000
<TABLE>
<CAPTION>
(DEFICIT)
ACCUMULATED
COMMON STOCK ADDITIONAL DURING THE
--------------------- PAID-IN DEVELOPMENT
SHARES AMOUNT CAPITAL STAGE TOTAL
--------- --------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C>
BALANCES, AUGUST 17, 2000 -- $ -- $ -- $ -- $ --
Issuance of stock in August 2000
for $.001 per share 3,029,870 3,030 -- -- 3,030
Net (loss) -- -- -- (825) (825)
--------- --------- ---------- --------- ---------
BALANCES, SEPTEMBER 12, 2000 3,029,870 $ 3,030 $ -- $ (825) $ 2,205
========= ========= ========== ========= =========
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
F-5
<PAGE> 29
CAMCAP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
FOR THE PERIOD
FROM
AUGUST 17, 2000
(INCEPTION) TO
SEPTEMBER 12,
2000
---------------
<S> <C>
CASH FLOWS FROM (TO) OPERATING ACTIVITIES:
Net (loss) $ (825)
Adjustments to reconcile net (loss) to net cash provided (used) by
operations:
Changes in:
Accounts payable 825
-------
Cash Flows Provided (Used) by Operating Activities --
-------
CASH FLOWS FROM (TO) FINANCING ACTIVITIES:
Common stock issued for cash 3,030
-------
Net Cash Provided by Financing Activities 3,030
-------
NET INCREASE IN CASH 3,030
CASH, beginning of period --
-------
CASH, end of period $ 3,030
=======
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
F-6
<PAGE> 30
CAMCAP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
HISTORY
CamCap, Inc. (the Company), a development stage company, was organized under the
laws of the State of Colorado on August 17, 2000. The Company is in the
development stage as defined in Financial Accounting Standards Board Statement
No. 7. The fiscal year end is June 30.
The Company is a wholly owned subsidiary of Cambridge Holdings, Ltd.
(Cambridge). It is Cambridge's intention to transfer ownership of the Company to
its stockholders.
GOING CONCERN
The Company's financial statements have been presented on the basis that it is a
going concern, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. The Company is in the
development stage and has not earned any revenues from operations to date.
The Company's ability to continue as a going concern is dependent upon its
ability to develop additional sources of capital, complete a merger or
acquisition of a private entity, and ultimately, achieve profitable operations.
The accompanying financial statements do not include any adjustments that might
result from the outcome of these uncertainties.
INCOME TAXES
The Company uses the liability method of accounting for income taxes pursuant to
Statement of Financial Accounting Standards No. 109. Under this method, deferred
income taxes are recorded to reflect the tax consequences in future years of
temporary differences between the tax basis of the assets and liabilities and
their financial amounts at year end.
For federal income tax purposes, substantially all expenses must be deferred
until the Company commences business and then they may be written off over a
60-month period. To date, the Company has incurred $825 in such expenses.
EARNINGS (LOSS) PER COMMON SHARE
During 1997 the Financial Accounting Standard Board (FASB) issued Statement of
Financial Accounting Standards No. 128, "Earnings per Share" (SFAS 128). SFAS
128 replaced the calculation of primary and fully diluted earnings per share
with basic and diluted earnings per share. Basic earnings (loss) per common
share is computed based upon the weighted average number of common shares
outstanding during the period. Diluted earnings per share consists of the
weighted average number of common shares outstanding plus the dilutive effects
of options and warrants calculated using the treasury stock method. In loss
periods, dilutive common equivalent shares are excluded as the effect would be
anti-dilutive.
F-7
<PAGE> 31
CAMCAP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS
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, the disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting periods.
Actual results could differ from those estimates and assumptions.
NOTE 2 - STOCKHOLDERS' EQUITY
SALE OF COMMON STOCK
During August 2000, the Company issued for cash 3,029,870 shares of its common
stock to Cambridge Holdings, Ltd. at $.001 per share.
PREFERRED STOCK
CamCap is authorized to issue up to 1,000,000 shares of $.001 par value
preferred stock, which may be issued from time to time in one or more series.
The Board of Directors is allowed to fix or alter the dividend rights, the
terms of redemption and the liquidation preferences of any unissued series of
preferred stock and may designate the number of shares constituting any such
series.
NOTE 3 - STOCK OPTION PLAN
2000 STOCK OPTION PLAN
The Company's 2000 Stock Option Plan, adopted effective August 23, 2000, has a
maximum of 500,000 common shares reserved to be issued to employees and
consultants upon the exercise of options which may be granted under the Plan.
The option price of shares may not be less than 100% of the fair market value of
common stock on the date of grant. The option price of shares issued to more
than 10% shareholders may not be less than 110% of the fair market value of the
common stock on the date of grant. The exercise term will not exceed ten years
from the date of the grant. The Plan shall terminate August 22, 2010. No options
have been granted through September 12, 2000.
F-8
