SB-2/A: Optional form for registration of securities to be sold to the public by small business issuers
Published on October 14, 2003
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON October 10, 2003
REGISTRATION STATEMENT NO. 333-104815
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 4 TO
FORM SB-2/A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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CORPORATE ROAD SHOW.COM INC.
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(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
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(ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)
80 ORVILLE DRIVE
SUITE 100
BOHEMIA, NEW YORK 11716
TEL: (631) 244-1555
FAX: (631) 244-1554
(AGENT FOR SERVICE OF PROCESS)
MR. FRANK FERRARO
80 ORVILLE DRIVE
SUITE 100
BOHEMIA, NEW YORK 11716
TEL: (631) 244-1555
(ADDRESS OF PRINCIPAL PLACE OF BUSINESS OR INTENDED PRINCIPAL PLACE OF BUSINESS)
80 ORVILLE DRIVE
SUITE 100
BOHEMIA, NEW YORK 11716
TEL: (631) 244-1555
FAX: (631) 244-1554
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COPIES TO:
WILLIAM S. ROSENSTADT, ESQ.
SPITZER & FELDMAN P.C.
405 PARK AVENUE,
NEW YORK, NEW YORK 10022-4405
TEL: (212) 888 6680
FAX: (212) 838 7472
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, 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 this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) under the Securities Act of 1933, as amended (the
"Securities Act").
WE HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE
NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL WE HAVE FILED 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 THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH
DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
The information in this Prospectus is not complete and is subject to change.
These securities may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. This Prospectus is not an offer
to sell these securities in any state where the offer of sale is not prohibited.
SUBJECT TO COMPLETION, DATED October 10, 2003
PRELIMINARY PROSPECTUS
2,500,000 Shares
CORPORATE ROAD SHOW.COM INC.
Common Stock
Corporate Road Show.com Inc. is offering 2,000,000 shares of common
stock, $.0001 par value, which as of this date have not been issued. Subject to
certain restrictions one of our shareholders, the selling shareholder, is
offering to sell 500,000 shares of our common stock held by him. We will not
receive any proceeds from the sale of the shares of common stock being offered
by the selling shareholder
The shares of our common stock which will be offered and sold by us on
a self-underwritten basis will be sold by using our officers, directors, or, at
our discretion, by participating broker-dealers licensed by the National
Association of Securities Dealers, Inc. at a price per share of $1.00. At this
time we have not identified any one entity to purchase our shares of common
stock. We are not required to sell a minimum amount in this offering and funds
received by us from this offering will not be placed into an escrow account.
Although the selling shareholder paid $1.00 per share, it should be noted that
there is no restriction requiring him to sell his shares at a price above $1.00
per share. However, until our securities are quoted on the OTC Bulletin Board,
the selling shareholder has agreed to sell his shares at a price of $1.00.
Therefore, the risk exists that shares offered by such individual may be sold to
the public at prices below our offering price.
Prior to this offering, there has been no public market for the common
stock. Our offering will commence on the date of this prospectus and will
continue until the earlier of _______________ [18 months after effectiveness],
all of the shares offered are sold, or we otherwise terminate the offering.
--------------------------
The shares of common stock being offered by this prospectus involves a
high degree of risk. You should read the "Risk Factors" section beginning on
Page 5 before you decide to purchase any of the common stock.
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In the event that we engage a broker-dealer to sell some or all of our
shares, we anticipate paying a commission of no more than ten (10%) percent
which would reduce our proceeds by $200,000 if all 2,000,000 shares were sold
subject to such commission.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE COMMISSION
HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR
ACCURACY OF THIS PROSPECTUS. NOR HAVE THEY MADE, NOR WILL THEY MAKE, ANY
DETERMINATION AS TO WHETHER ANYONE SHOULD BUY THESE SECURITIES. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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Until________________, [90 days after effectiveness] all dealers that
effect transactions in these securities, whether or not participating in this
offering, may be required to deliver a prospectus. This is in addition to any
dealers' obligation to deliver a prospectus when acting as underwriters and with
respect to any unsold allotments or subscriptions.
THE DATE OF THIS PROSPECTUS IS [October 10, 2003]
ii
TABLE OF CONTENTS
Prospectus Summary...........................................................1
The Offering.................................................................3
Summary Financial Data.......................................................4
Risk Factors.................................................................5
Use of Proceeds.............................................................10
Determination of Offering Price.............................................12
Dilution....................................................................12
Capitalization..............................................................14
Dividend Policy.............................................................15
Management's Discussion and Analysis and Results of Operations..............15
Description of Business.....................................................18
Management..................................................................24
Code of Ethics..............................................................27
Certain Relationships and Related Transactions..............................27
Disclosure of Commission Position of Indemnification
for Securities Act Liabilities..............................................28
Security Ownership of Certain Beneficial Owners and Management..............29
Selling Shareholder.........................................................30
Description of Securities...................................................30
Plan of Distribution........................................................32
Legal Matters...............................................................34
Experts.....................................................................35
Where You Can Find More Information.........................................35
Financial Statements.......................................................F-1
iii
PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in this
prospectus. This summary does not contain all of the information that you should
consider before investing in the securities. You should read the entire
prospectus carefully, especially the risks of investing in the securities
discussed under "Risk Factors" beginning on page 5.
About Us
Corporate Road show.com Inc. was initially incorporated on November 1,
1999 in the State of New York (hereinafter "CRS", "we" or "us").
Our Business
Presently, we are an internet based marketing company which produces
and hosts corporate videos. Currently our main service is videotaping corporate
interviews or events and making the presentations available on both the
worldwide web via our website www.corporateroadshow.com or in a hardcopy format.
Our website serves as a distribution center for companies seeking to showcase
their products and market their goods and services to the global internet
community. We have the capabilities to produce high quality but reasonably
priced custom-made "live" and "on demand" video and audio productions as we
contract a local studio to perform the original video production work and that
any interviews that we produce are filmed by an independent video crew that we
retain.
Our fees are scaled depending on the extent of services rendered by us.
Fees can vary depending on different needs the client might have for video
production. Although we have yet to produce a video with a celebrity
interviewer, a client may desire such. In that event, we would anticipate having
to charge more based on the hiring of the actor. We also charge extra for
traveling out of state or to different locations. In determining our fees for
hosting several factors are: the length of the production; number of mega bytes
it converts into; the level of streaming (56K,DSL,T-1); and the term of the
hosting agreement. Our ISP charges us a monthly fee of $1.00 per mega byte per
month. Thus, if a 15minute production translates into 60MB, our hosting cost
would be $60 for that month for that video. We have to incorporate these charges
in our fees as well.
Our content can vary depending on the company. Our content in our past,
whether it be an interview or presentation has been limited to corporate
executives discussing their company and its respective services. In all of our
productions we put a general disclaimer on the front page of our website which
discloses the number of shares of our clients we have been paid for our
services. Only companies that have not paid us for our services are not found in
the disclaimer. Regarding our disclaimer, we now have a click thru button to
make sure visitors have acknowledged reading the disclaimer before viewing the
videos. This same disclaimer is also annexed to the video files.
In addition to the continued development of our core internet business,
we are now poised to begin the second phase of our corporate growth: television
production. We believe that by producing a weekly half-hour "investment format"
program featuring small to mid-sized companies, we can offer a value added
service previously unavailable to that targeted capital market. Initially, we
intend to televise such a program in the New York metropolitan region.
In an effort to get new or interesting content or to expand our network
and marketing capabilities we sometimes put videos up for little or no
consideration. For example, Polymer Research Group was a NASDAQ company which,
at the time, we believed gave us a higher profile than previous clients and
allowed us to market ourselves more effectively. We were not compensated nor
have any other relationship with Polymer except for producing and hosting the
video clip. As for Vintage filings and Neil Kaufman, both companies allow us to
provide links to services that visitors to our site may be able to utilize.
Vintage filings offers EDGAR filings for publicly traded companies, including
our own. We view them as a potential source of leads for companies wishing to
use our services. Neil Kaufman, as the managing partner in the law firm of
Kaufman & Associates and a member of the board of directors of the Long Island
Venture Group is another important potential contact in our networking efforts.
We have no agreement with Mr. Kaufman. We anticipate providing additional free
content to select clients or service providers in the future.
1
Typical Internet Production
Once a client has retained us for a video production, we will set up
and perform an interview with such client. Such interview will be filmed by an
independent video crew that we retain. Generally, the interviewer will be an
actor hired by us. After the filming process is complete, the video goes to the
edit room for editing, music, title page credits and other production aspects.
We then digitize the video for hosting over the Internet. The client then has
access to the video on the Internet and can email that video to any data base
(ie. shareholders, employees, customers).
Show Concept
Corporate Roadshow Presents is anticipated to be a 1/2 hour infomercial
designed to appear as a regular television program showcasing various companies
profiling their goods and services. Shot in the field and our studio, Corporate
Roadshow Presents will showcase and highlight each participating company. We
anticipate that our host, who is undetermined at the moment, will serve to
introduce and moderate discussions regarding a particular company, its
executives and sales people.
Corporate Roadshow Presents will appear as a traditional business
program. We intend to provide a sophisticated presentation integrating top
quality editing, graphics and a fast-paced assortment of segments and
commercials, all seamlessly blended together which will provide both
entertainment and information for the viewers.
Sponsor Participation
Corporate Roadshow Presents will allot each sponsoring company or
client a minimum of four minutes of programming focused on their company and its
product or service in addition to two 30 second commercials or any combination
of the 5 minute timeslot as negotiated between CRS and the sponsor. Each
sponsors' segment can appear in a variety of formats. We will allow the sponsor
to choose a structure most effective for it from a segment spanning the
continuous 4 min. time slot to a number of smaller segments profiling the
sponsor.
New York Broadcast
Targeted airdate: Second Quarter of 2004. Although we have not yet
entered into any formal agreements, we intend to air Corporate Roadshow Presents
on major New York television stations. With over 12,000,000 possible viewers and
as a world financial center, we believe that penetrating the metropolitan New
York marketplace is our most important initial goal. We intend to air the
program on weekends, envisioning a Sunday late morning timeslot.
Promotion
Although the exact formula has yet to be determined, in an attempt to
cross promote and drive viewers to our programs, we intend to advertise the
broadcast of the show with either 15 or 30 second commercials as available on
regional or local cable and broadcast stations preceding the broadcast.
Production Schedule
We anticipate producing a program over a period of three to four weeks
either in the studio or from time to time in the field, or a combination of
both. This period of time is necessary so that each project can be viewed from
start to finish.
2
Employees
As of September 30, 2003, we had 2 employees which includes managerial
and sales positions.
Our Offices
Our executive offices are located at 80 Orville Drive - Suite 100,
Bohemia, New York 11716. Our telephone number is (631) 244-1555.
THE OFFERING
Securities Offered by US
Shares........................................................2,000,000
Price Per Share...................................................$1.00
Securities Offering by Selling Shareholder
Shares..........................................................500,000
Price Per Share...................................................$1.00
Shares of Common Stock Outstanding After Offering
assuming maximum number of shares sold...................7,730,000
We will bear all the costs and expenses associated with the preparation
and filing of this registration statement.
Estimated Use of Proceeds
We intend to use substantially all of the net proceeds from our sale of
our shares of common stock for general corporate purposes, including working
capital, expansion of sales and marketing activities which include the planned
expansion into the television production business. We will not receive any of
the proceeds from the sale of those shares being offered by the selling
shareholder.
Risk Factors
For a discussion of the risks you should consider before investing in
our shares, read the "Risk Factors" section.
3
SUMMARY FINANCIAL DATA
The summary financial information set forth below is derived from the financial
statements appearing elsewhere in this Prospectus. Such information should be
read in conjunction with such financial statements, including the notes thereto.
Balance Sheet Data
June 30, 2003 December 31, 2002
Working Capital $ 35,130 $ 224,110
Total Assets $ 130,687 $ 293,917
Total Liabilities $ 7,269 $ 10,424
Stockholders' Equity $ 123,418 $ 283,493
See Financial Statements
4
RISK FACTORS
An Investment In Our Common Stock Involves A High Degree Of Risk.
Investors could lose their entire investment. Prospective investors
should carefully consider the following factors, along with the other
information set forth in this prospectus, in evaluating CRS, its business and
prospects before purchasing the common stock.
The Timing And Amount Of Capital Requirements Are Not Entirely Within Our
Control And Cannot Accurately Be Predicted And As A Result, We May Not Be Able
To Raise Capital In Time To Satisfy Our Needs.
If we do not increase our revenue significantly we will need to procure
additional financing by December 31, 2003. If capital is required, we may
require financing sooner than anticipated. We have no commitments for financing,
and we cannot be sure that any financing would be available in a timely manner,
on terms acceptable to us, or at all. Further, any equity financing could reduce
ownership of existing stockholders and any borrowed money could involve
restrictions on future capital raising activities and other financial and
operational matters. If we were unable to obtain financing as needed, we could
be bankrupt.
We Have Been Incurring Losses From Operations Since Our Inception In 1999 And At
June 30, 2003 Had An Accumulated Deficit Of $344,602.
Stockholders' equity and working capital was $123,418 and $35,130,
respectively. Although we believe that our business expansion will be successful
and that we will become profitable, no assurance can be given in this regard.
We Compete With Investor Relations And Public Relations Firms, Many Of Which Are
Better Financed And Have A Stronger Presence In The Industry Than Ourselves.
As many of our clients have limited resources to apply to public
relations or investor relations efforts, we may find ourselves competing with
firms offering traditional PR and IR services which may be able to offer
services at more competitive prices.
As many of these firms have significantly stronger name recognition
than ourselves, they are in a position to quickly attract public companies which
are in need of strong marketing and information campaigns thus adversely
impacting our potential pool of clients. Our sales and marketing structure is
not proprietary and it would not be difficult for a media company, whether it be
on the Internet or traditional medium to offer similar services. Further, entry
into the marketplace by new competitors is relatively easy especially
considering their existing presences and their greater resources for financing,
advertising and marketing. We intend to compete based on our ability to market
and sell our services to small and mid-sized public companies on a reasonably
priced and personalized basis.
5
We Have A Limited Operating History And Have Losses Which We Expect To Continue
In The Future. As A Result, We May Have To Suspend Or Cease Operations.
Although we were incorporated in November 1999, we began operations in
earnest in January of 2002. Thus, we have little operating history upon which an
evaluation of our future success or failure can be made. Our net loss since
inception is ($344,602). Our ability to achieve and maintain profitability and
positive cash flow is dependent upon our ability to procure new business and
generate revenues.
Based upon current plans, we expect to incur operating losses in future
periods. This will happen because our minimum operating expenses continue to
exceed our projected revenues significantly. Our failure to generate sufficient
revenues in the future will cause us to suspend or cease operations.
We Only Have Two Employees And As A Result We Are Dependent On Their Services
And A Loss Of Either Could Have A Material Adverse Effect Upon Us.
Frank Ferraro is our Founder, Chairman and President and Vincent
Epifanio is our Senior Vice President and Director of Marketing. Although Mr.
Ferraro has an exclusive employment contract with us and is our largest
shareholder, there can be no assurance that he will remain with us during the
term of his respective contract. In the event that we were to lose Mr. Ferraro
as an employee our business operations would cease.
We May Not Be Able To Adequately Protect Our Intellectual Property Rights Which
May Result In A Substantial Loss Of Revenue If Such Rights Are Challenged.
Although we recently filed a service mark application with the United
States Patent and Trademark Office, we have certain intellectual property rights
which are not protected including, among others:
o Subscriber lists and related information;
o Content and information provider lists and related
information;
o Proprietary web site content; and
o Content on our news programs.
To protect our rights to our intellectual property, we will rely on a
combination of trademark and copyright law, trade secret protection,
confidentiality agreements and other contractual arrangements with our
employees, affiliates, clients, strategic partners and others. The protective
steps we have taken may be inadequate to deter misappropriation of our
proprietary information. We may be unable to detect the unauthorized use of, or
take appropriate steps to enforce, our intellectual property rights. Effective
trademark, copyright and trade secret protection may not be available as many of
our productions are and will be available on the Internet. Failure to adequately
protect our intellectual property could harm our brand, devalue our proprietary
content and affect our ability to compete effectively. Further, defending our
intellectual property rights could result in the expenditure of significant
financial and managerial resources, which could materially adversely affect our
business, results of operations and financial condition.
System Slowdowns Or Failures Could Hurt Our Business.
In order for our business to be successful, we must provide
consistently fast and reliable access to our web site. Unfortunately, slowdowns,
breakdowns or failures in our computer and communication systems, or of the
Internet generally, are often beyond our control and could jeopardize access to
our site at any time. In addition, heavy traffic on our site or on the Internet
generally could severely slow access to, and the performance of, our site.
Repeated system slowdowns will likely impair our ability to service and maintain
the public's access to our clients. Failures of or damage to our computer or
communications systems could render us unable to operate our site or even our
business for extended periods of time.
6
As We May Not Be Able To Adequately Protect Ourselves Against Security Risks,
Our Services May Be Disrupted Or Our Customer Proprietary Information May Be
Available By Unauthorized Third Parties.
All Internet businesses are subject to electronic and computer security
risks. We have taken steps to protect ourselves from unauthorized access to our
systems and use of our site, but we cannot guarantee that these measures will be
effective. If our security measures are ineffective, unauthorized parties could
alter, misappropriate, or otherwise disrupt our web-based videos. If such
unauthorized parties were able to access certain of our or our customers'
proprietary information, we would face significant unexpected costs and a risk
of material loss, either of which may cause us to cease operations.
The Selling Shareholder May Compete With Us In Selling Common Stock And
Therefore Drive The Market Price Lower.
Our ability to raise additional capital through the sale of our common
stock may be harmed by competing re-sales of common stock by the selling
shareholder. The selling shareholder may only sell at a price other than the
fixed price of $1.00 after we have been listed on the OTC-BB. Sales by the
selling shareholder may make it more difficult for us to sell equity or
equity-related securities in this offering or in the future at a time and price
that we deem appropriate because the selling shareholder may offer to sell his
shares of common stock to potential investors for less than we do. Moreover,
potential investors may not be interested in purchasing shares of our common
stock if the selling shareholder is selling (or even has the ability to sell)
his shares of common stock. If we are unable to sell some or all of the shares
being issued we may run out of money and cease operations as a result.
To A Significant Extent The Growth Of Our Business Is Dependent On An Increase
In The Public's Interest In The Stock Market.
The recent depressed stock market has decreased the public's interest
in investment and financial information. If this were to happen, it is likely
that we would lose a significant percentage of our then current and potential
subscriber base.
Before This Offering, There Has Been No Public Market For Our Common Stock And
If No Market Develops, Investors Would Be Unable To Sell Their Securities.
We are not sure that a public trading market for our common stock will
develop after this offering, or that the public offering price will correspond
to the price at which our common stock will trade subsequent to this offering.
The stock market has experienced price and volume fluctuations which have
resulted in changes in the market prices of stocks of many companies that may
not have been directly related to the operating performance of those companies.
Such broad market fluctuations may adversely affect the market price of our
common stock following this offering. In addition, the market price of our
common stock following this offering may be highly volatile. Factors such as
variations in our interim financial results, comments by securities analysts,
announcements of technological innovations or new products by us or our
competitors, changing market conditions in the industry, changing government
regulations, developments concerning our proprietary rights or litigation, many
of which are beyond our control, may have an adverse effect on the market price
of the common stock.
Under certain conditions, we may receive securities as partial payment for our
services rendered and such securities may lose all value we ascribe to them.
7
In certain circumstances, we may accept a client's securities as
partial payment. Often the securities we receive are unregistered and as a
result restricted. As a general rule we must hold restricted securities for one
year until we have the ability to sell them. Although we book any restricted
securities we receive at a significantly reduced valuation in comparison to the
same company's unrestricted shares, there is a risk that during such holding
period the securities may be become worthless. We would suffer a loss of revenue
as a result of such devaluation.
We allow certain clients to pay for our services with a combination of
cash and restricted securities of theirs and as a result we are somewhat
dependent on such companies ability to succeed in the marketplace. In the past,
any restricted securities we have received have required that a significant
period of time elapse between when such securities are received and when they
may be sold into the market. In the event that any securities we receive as
partial payment decline in value from the time we receive them and we find
ourselves in the unfortunate position of needing to raise capital for operations
by selling some or all of such securities we may suffer irreparable harm.
Purchasers Of The Shares Offered Hereby Will Incur Immediate Substantial
Dilution In The Net Tangible Book Value Of Approximately $.74 Or 74% Per Share.
Our present shareholders have acquired their respective equity
interests at a cost substantially below the offering price. Accordingly, the
public investors will bear a disproportionate risk of loss per share.
We make estimates of our future in forward-looking statements.
The statements contained in this prospectus that are not historical
fact are "forward-looking statements," which can be identified by the use of
forward-looking terminology such as "believes," "expects," "may," "should," or
"anticipates," the negatives thereof or other variations thereon or comparable
terminology, and include statements as to the intent, belief or current our
expectations with respect to the future operations, performance or position.
These forward-looking statements are predictions. We cannot assure you that the
future results indicated, whether expressed or implied, will be achieved. While
sometimes presented with numerical specificity, these forward-looking statements
are based upon a variety of assumptions relating to our business, which,
although currently considered reasonable by us, may not be realized. Because of
the number and range of the assumptions underlying our forward-looking
statements, many of which are subject to significant uncertainties and
contingencies beyond our reasonable control, some of the assumptions inevitably
will not materialize and unanticipated events and circumstances may occur
subsequent to the date of this prospectus. These forward-looking statements are
based on current information and expectation, and we assume no obligation to
update them at any stage. Therefore, our actual experience and results achieved
during the period covered by any particular forward-looking statement may differ
substantially from those anticipated. Consequently, the inclusion of
forward-looking statements should not be regarded as a representation by us or
any other person that these estimates will be realized, and actual results may
vary materially. We can not assure that any of these expectations will be
realized or that any of the forward-looking statements contained herein will
prove to be accurate.
The penny stock rules.
8
Because we may be subject to the "penny stock" rules, the level of
trading activity in our stock may be reduced. Broker-dealer practices in
connection with transactions in "penny stocks" are regulated by certain penny
stock rules adopted by the Securities and Exchange Commission. Penny stocks,
like shares of our common stock, generally are equity securities with a price of
less than $5.00, other than securities registered on certain national securities
exchanges or quoted on NASDAQ. The penny stock rules require a broker-dealer,
prior to a transaction in a penny stock not otherwise exempt from the rules, to
deliver a standardized risk disclosure document that provides information about
penny stocks and the nature and level of risks in the penny stock market. The
broker-dealer also must provide the customer with current bid and offer
quotations for the penny stock, the compensation of the broker-dealer and its
salesperson in the transaction, and, if the broker-dealer is the sole market
maker, the broker-dealer must disclose this fact and the broker-dealer's
presumed control over the market, and monthly account statements showing the
market value of each penny stock held in the customer's account. In addition,
broker-dealers who sell these securities to persons other than established
customers and "accredited investors" must make a special written determination
that the penny stock is a suitable investment for the purchaser and receive the
purchaser's written agreement to the transaction. Consequently, these
requirements may have the effect of reducing the level of trading activity, if
any, in the secondary market for a security subject to the penny stock rules,
and investors in our common stock may find it difficult to sell their shares.
9
USE OF PROCEEDS
The estimated expenses of the distribution, all of which are to be
borne by us, are as follows. All amounts are estimates except the Securities and
Exchange Commission registration fee:
Registration Fee.............................. $ 230
Printing and Engraving Expenses............... $ 5,000
Accounting Fees and Expenses.................. $ 25,000
Legal Fees and Expenses....................... $ 60,000
Transfer Agent's Fees and Expenses............ $ 1,500
Miscellaneous................................. $ 8,270
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Total $ 100,000
We do not have a firm commitment from any party to purchase any of the
shares being offered by us. We intend to sell the shares ourselves or through
broker/dealers. The following table discloses the gross proceeds less offering
expenses (as detailed above) we would realize from the sale of the related
numbers of shares.
These proceeds are intended to be utilized substantially for working
capital and general corporate purposes as well as the costs and expenses
associated with our expansion into the network broadcasting arena. As management
retains sole discretion as to the use of proceeds, such use of proceeds will not
vary
10
unless management (i) determines that the proceeds would better serve the
company's interests by acquiring a complementary production business in lieu of
developing one itself; and (ii) management is presented with the opportunity to
acquire such a business, it reserves the right to use them for such purpose. In
the event that management alters its use of proceeds as a result of the
aforementioned, we would reduce the proceeds for each category in the above
table on a pro-rata basis. A complementary production business would be a
web-based video of investor relations operation. We have not entered into any
negotiations, preliminary or otherwise, to acquire a complementary business and
thus have no indication as to the form or structure such transaction would
entail. Although we may acquire such a business though either our stock alone or
a combination of our stock and cash, we are not planning on issuing an amount of
stock resulting in a change of control. We would only enter into such an
acquisition if we determined that it significantly strengthened our business by
allowing us to focus on the other aspects of our business plan.
If we sell less than 25% of the shares being offered we will apply any
proceeds in the same percentage breakdown as indicated in the above table giving
no priority to any one particular category.
Regardless of whether we sell any shares of our Common Stock, we have
incurred approximately $100,000 in costs and expenses in regards to the
preparation of the Registration Statement of which this Prospectus forms a part.
If we sell the maximum number of shares offered by this Prospectus, the
net proceeds to us from this offering are expected to be adequate to fund our
working capital needs for at least the next twelve (12) months. Pending maximum
use of the proceeds from this offering as set forth above, we may invest all or
a portion of such proceeds in sort-term, interest-bearing securities, U.S.
Government securities, money market investments and short-term, interest-bearing
deposits in major banks. If we sell less than 25% of the securities offered
hereby, we will need additional capital to maintain our working capital needs
for the next twelve (12) months.
In the event that we engage a broker-dealer to sell shares in this
offering, we would anticipate paying a fee no more than ten (10%) percent of any
shares sold by such broker/dealer. Thus, our use of proceeds would be reduced by
that amount.
11
DETERMINATION OF OFFERING PRICE
The offering price has no relationship to any established criteria of
value, such as book value or earnings per share. No valuation or appraisal has
been prepared for our business and potential business expansion. The offering
price was determined arbitrarily.
DILUTION
The issuance of the 2,000,000 shares will dilute our common stock and
may ultimately lower the price of our common stock. If you invest in our common
stock, your interest will be diluted to the extent of the difference between the
price per share you pay for the common stock and the pro forma as adjusted net
tangible book value per share by calculating the total assets less intangible
assets and total liabilities, and dividing it by 7,730,000, the number of
outstanding shares of common stock assuming the maximum number of shares being
offered by us are sold.
The net tangible book value of our common stock as of June 30, 2003, was
$68,298, or approximately $.01 per share. Thus, as of June 30, 2003, the net
tangible book value per share of common stock owned by our current stockholders
would have increased by $1,955,000 or $.25 per share after giving effect to this
offering (assuming the maximum number of shares being offered are sold) without
any additional investment on their part and the purchasers of the shares offered
hereby would have incurred an immediate dilution of $.74 per share from the
offering price. The following table illustrates this per share dilution and
reflects the receipt of varying amounts of proceeds:
12
The following tables summarize the relative investments of investors
pursuant to this offering and the current shareholders of CRS:
13
In the future, we may issue additional shares, options and warrants,
and we may grant stock options to our employees, officers, directors and
consultants under our stock option plan, all of which may further dilute our net
tangible book value.
CAPITALIZATION
The following table sets forth our capitalization as of June 30, 2003.
This table should be read in conjunction with the financial statements and
related notes included elsewhere in this prospectus.
June 30, 2003
Actual
------
Stockholders' Equity:
Common Stock, $0.0001 par value,
20,000,000 shares authorized;
5,730,000 issued and outstanding $ 573
Additional Paid-In Capital 485,447
Retained Earnings (deficit) (344,602)
Accumulated other comprehensive
loss (18,000)
----------
Total Stockholders' Equity 123,418
----------
Total Capitalization $ 123,418
==========
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DIVIDEND POLICY
Holders of the common stock our entitled to dividends when, as and if declared
by our Board of Directors out of funds legally available therefore. We have
never declared or paid any cash dividends and currently do not intend to pay
cash dividends in the foreseeable future on our shares of common stock. We
intend to retain earnings, if any, to finance the development and expansion of
our business. Payment of future dividends on our common stock will be subject to
the discretion of our Board of Directors and will be contingent on future
earnings, if any, our financial condition, capital requirements, general
business conditions and other factors. Therefore, there can be no assurance that
any dividends on our common stock will ever be paid.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
We commenced operations on July 1, 2000 through the launching of our
website, which serves as our platform for our internet based "live and on
demand" audio and video productions of financial road shows, conferences and
presentations.
The following discussion should be read in conjunction with our
financial statements and notes thereto contained elsewhere in this prospectus.
This discussion may contain forward-looking statements that could involve risks
and uncertainties. For additional information see "Risk Factors".
CRITICAL ACCOUNTING POLICIES:
Our financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America, which require
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements, the disclosure
of contingent assets and liabilities, and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates. The critical accounting policies that affect our more significant
estimates and assumptions used in the preparation of our financial statements
are reviewed and any required adjustments are recorded on a monthly basis.
RESULTS OF OPERATIONS:
Substantial positive and negative fluctuations can occur in our
business due to a variety of factors, including variations in the economy, and
the abilities to raise capital. As a result, net income and revenues in a
particular period may not be representative of full year results and may vary
significantly in this early stage of our operations. In addition results of
operations, which have fluctuated in the past and may vary in the future,
continue to be materially affected by many factors of a national and
international nature, including economic and market conditions, currency values,
inflation, the availability of capital, the level of volatility of interest
rates, the valuation of security positions and investments and legislative and
regulatory developments. Our results of operations also may be materially
affected by competitive factors and our ability to attract and retain highly
skilled individuals.
Year Ended December 31, 2002 and 2001:
We recognize revenues at the time that all services have been substantially
completed. We have received equity securities in certain entities as payments
for services provided for these entities. Some of these entities are privately
owned, newly formed and have no operating history. Since there is no assurance
that these securities are marketable and collectibility is not assured, we do
not recognize any revenue upon receipt. Revenue will be recorded at the time the
securities are determined to have a monetary value. We also receive restricted
securities in publicly traded entities. In such instances, revenue is recorded
with a discount of 75% from the market value at the time of receipt since (i)
the securities are restricted and (ii) there is no assurance that the value of
these securities will be realized. At the time that such securities are able to
be sold, we will recognize any resulting gain and/or loss. The amount of shares
we will accept in lieu of a portion of a client's cash payment is situation
specific. Such amount is never contingent on the success or failure of our
efforts.
15
We realize revenues from net sales generated by the production of video
presentations and increased such revenues by $14,614 to $25,189 in 2002 from
$10,575 in 2001. This increase is a result of our marketing efforts and the
availability of our services becoming more known to the corporate world. The
production costs also increased accordingly. Revenues earned in 2002 include
$13,450 in proceeds resulting from the sale of securities received for services
rendered. We also received restricted securities in 2002 and recorded such
securities using a 75% discount from the market value at the time of receipt in
the amount of $11,739.
Costs and expenses were $188,140 and $38,606 for the years ended
December 31, 2002 and 2001, respectively, an increase of $149,534. This increase
is reflective of the following: (i) increased executive compensation of $36,000;
(ii) an increase of $13,352 in advertising which increase generated more
revenues; (iii) an increase of $78,275 in fees paid to consultants (iv) an
increase of $19,216 in other expenses including insurance and other office
expenses.
With respect to the fees paid to consultants, we paid a $65,000 fee
to Five Flags, Inc., an unaffiliated entity, as a result of its introduction of
various potential clients to the Company. Further, Five Flags, Inc. also
received $100,000 as a result of its introduction of the Company to Mr. Eli
Weinstein, the selling shareholder. Such amount represented 20% of the gross
proceeds of Mr. Weinstein's investment, as agreed, as was reflected as a cost of
raising capital and charged against additional paid-in capital. Mr. Weinstein
invested a total of $500,000 in the Company during 2002.
As a result of the above, the net loss for the year ended December 31,
2002 was $162,951, or $0.03 per share, compared to a net loss of $28,031 or
$0.01 for the year ended December 31, 2001.
Six Months Ended June 30, 2003 and 2002:
Revenues for the six month period ended June 30, 2003 was $28,495 as
compared to $13,556 for the same period of the previous year. This increase of
$14,939 or 110% is a direct result of our improved marketing efforts. Revenues
earned in the June 2003 six-month period include $5,000 received in cash for
services rendered. We also received restricted securities in the same six-month
period and recorded such securities using a 75% discount from the market value
at the time of receipt in the amount of $23,495.
Operating expenses increased by $134,290 from $33,188 for the six
months ended June 30, 2002 to $167,478 for the 2003 period. Payroll accounted
for $45,720 of this increase (an increase from $30,000 in 2002 to $75,720 in
2003) as a result of new hires in 2003. We incurred $31,120 in professional fees
during the six month period ended June 30, 2003 compared to zero for the same
period in 2002. Such fees include the value of 20,000 shares of our common stock
(valued at $20,000 based upon the price of shares sold in our private placement
of securities) issued to Mr. Benjamin Lapin. Mr. Lapin introduced us to Dynamic
Distribution Corp., a potential client, although no revenue was ultimately
realized from such introduction. In 2003, we produced a marketing brochure and
incurred advertising expenses in the aggregate amount of $25,509 compared to
minimal expense in 2003. Other expense increased from $361 for the six-month
period ended June 30, 2002 to $33,578 for the comparable period in 2003. This
increase of $33,217 includes (i) rent in the amount of $10,640; (ii) payroll
taxes amounting to $7,007 and (iii) insurance amounting to $7,964.
As a result of the above, the net loss for the six months ended June
30, 2003 was $138,983 or $0.02 per share, compared to a net loss of $19,632 or
$0.00 for the similar period in 2002.
LIQUIDITY AND CAPITAL RESOURCES:
As of June 30, 2003, working capital amounted to $35,130 compared to
$224,110 at December 31, 2002. Our current ratio at June 30, 2003 and December
31, 2002 was 5.8:1 and 22.5:1, respectively.
During 2002, we utilized $121,924 for operations primarily as a result
of our net loss of $162,951. For the 2001 year we generated $2,207 in cash from
operations. During 2002, we used $21,991 for investing activities, primarily for
the acquisition of office equipment, including a computer, with no comparable
amount used in 2001. During 2002, we sold our common shares in a private
placement and realized net proceeds of $377,500. As a result of this, we ended
2002 with cash of $234,044.
16
In June 2002 we issued 250,000 shares of common stock to Eli Weinstein,
the selling shareholder, for consideration of $250,000. We paid Five Flags, Inc.
$50,000 (20%) as a fee for having Mr. Weinstein invest in our Private Placement.
In October 2002 we further issued 250,000 shares of common stock to Mr.
Weinstein for $250,000. We again paid Five Flags, Inc. a fee of $50,000 (20%)
for having Mr. Weinstein invest in our Private Placement for a total
consideration of $100,000 for the raising of capital. Five Flags, Inc. is not a
registered broker-dealer. These issuances of shares of common stock to Mr.
Weinstein by us did not involve any public offering and was exempt from the
registration requirements under the Securities Act pursuant to Section 4(2)
thereof.
For the six month period ended June 30, 2003, we utilized $120,703 for
operations, primarily as a result of our net loss of $138,983, compared to
$16,233 in cash generated from operations for the similar period in the previous
year. Cash utilized for investing activities for the 2003 period aggregated
$31,363 and was used for the purchase of office furniture and equipment. During
the six month period ended June 30, 2002, we sold common shares in a private
placement and realized net proceeds of $193,800. During 2003, we continued to
incur costs ($40,120) associated with the proposed public offering of our common
shares. As a result, our cash balance at June 30, 2003 was $41,663.
We have a limited operating history. Some of our clients to date are
also in the early stages of their operations with not much available cash on
hand. As a result, as previously discussed, we occasionally receive restricted
equity securities issued by our clients. Due to the restrictions and since the
values of these securities fluctuate and are not readily convertible to cash we
initially record the receipt of such securities at a significant (75%) discount.
Based on the above, the securities are reflected as investments available for
sale on our balance sheet. At the balance sheet date, we compare the then market
price or fair value of such securities, using the same benchmark of a 75%
discount, to the amount initially recorded and any resulting unrealized gain or
loss is recorded as other comprehensive income or loss in the equity section of
our balance sheet. As of June 30, 2003, the unrealized loss of all securities
received as compensation and held for sale aggregated $18,000 which amount is
reflected on the balance sheet as accumulated other comprehensive loss. At the
time the restriction is lifted (usually within one year of receipt) and we are
able to sell the securities, the resulting gain or loss realized will be
recognized in our statement of operations. The increase or decrease in these
investment securities is shown in investing activities on the statement of cash
flows.
We are currently operating with insufficient working capital, which,
among other things has constrained our ability to market our services. As a
result, management is dependent on the proceeds of the proposed public offering
of securities to maintain and increase the level of its operations. There can,
however, be no assurance that we will be successful.
IMPACT OF INFLATION
To date inflationary factors have not had a significant effect on our
operations. We are not aware of any material trend, event or capital commitment,
which would potentially adversely affect liquidity.
OTHER:
Except for historical information contained herein, the matters set
forth above are forward-looking statements that involve certain risks and
uncertainties that could cause actual results to differ from those in the
forward-looking statements. Potential risks and uncertainties include such
factors as the level of business and consumer spending, the amount of sales of
our products, the competitive environment within our industry, the ability to
continue to expand our operations, the level of costs incurred in connection
with our expansion efforts, economic conditions and the financial strength of
our customers and suppliers.
17
DESCRIPTION OF BUSINESS
History and Development
We were incorporated pursuant to the laws of the State of New York on
November 1, 1999 under the name Corporate Road Show.Com Inc. On July 1, 2000 we
launched our website on the Internet and began a limited marketing campaign for
our Internet based presentations.
Our basic business model is to help the corporate executive get their
story out to a vast but targeted audience over the internet or television, as
well as compliment their current marketing plans.
We are a business to business service firm. Our basic service is to
host and digitize corporate videos already produced by our clients. We offer an
upgraded service where we actually videotape and produce a corporate
presentation for dissemination on our website. The fees can vary on each. For
example, for web hosting we have to determine the length of the video in
digitized megabytes and the time period such video will be hosted by us. The fee
for producing a corporate video can fluctuate depending on the location,
scripting, the amount of editing, talent and other factors. The market for these
services are vast. Our target market is a company offering a new product or
service and which has the desire to market itself to the public in a possibly
untried format or medium. Our targeted audience for these productions consists
of both the investment community and the public at large. For those persons
looking for new investments in public companies we attempt to introduce such
companies to them. However, our clients are also interested in increasing sales
of their products and exposure of their business plans. Our television
productions will blend the investment and marketing concept even further by
using an anticipated "news" format.
We broadcast in over 35 countries, however we measure success by the
amount of video views or "hits" a client's video receives. The goal for clients
is to get the message across to the general public via our website. Each
featured video has different content as a result of varying product lines and
offered services, however, our format may change. For example, Polymer Research
and Genesis Bioventures used an interview format. For these clients, we
interviewed the companies and then we disseminated the interview on the website.
The other type of setting is the Power Point visual video where we produce a
presentation that we videotape, digitize and host. The video productions we have
produced to date are "About Us" 1&2, Asconi Corp, Polymer Research Group,
Genesis Bioventures and Skybridge Wireless, Inc., Juniper Group, Inc. and Neil
Kaufman, Esq. All of the aforementioned productions were disseminated on our
website.
We consider ourselves a vehicle for the promotion of our clients'
products and services via the internet and our intent in the future is via
television.
Typical Revenue Producing Transaction
A client's first experience with us results from the following
scenarios: (i) in response to our advertising campaign; (ii) as a recipient of a
marketing campaign on behalf of a client; or (iii) after production of our
planned financial television programs, in response to such. After the initial
discussion, we then determine which format is preferred (i.e. interview, Power
Point presentation). We then film the interview, edit it with sound and digitize
it in either Real Player or the Microsoft Media platform. Lastly, we will
broadcast the presentation on the Internet where interested parties can log on
and watch the show.
To date we have produced the following videotapes:
o In June of 2001 we created a videotape for the Asconi corp.
which was on our web site for about three months. The video
focused on introducing a viewer to Asconi's business which is
the production and distribution of wines from the country of
Moldova. We were paid a fee of $5,000 for services rendered.
o In July of 2002 we created two separate "about us" videos
representing and describing the content and services that CRS
is capable of providing to our clients. There were no fees
paid or charged for either of these two videos.
18
o Also in July of 2002 we developed a videotape for the Polymer
Research Group which was available on our website for about
one year. The content of the Video focused on Polymer's
business as well as the "chemical grafting technique" which is
the company's most well know service. We were not paid a fee
or charged for this client.
o In November of 2002 we created a videotape for Genesis
Bioventure group. The Genesis video focused on Genesis'
ability to detect early stage breast cancer using Mammastatin
Serum Assay technology. Our agreement with Genesis is that we
will receive the following payment in quarterly increments
every 3 months as the Genesis video will be on our website for
one year. Upon completion of the one year period we will have
been paid 100,000 shares of restricted stock and 150,000
warrants to purchase Genesis' common stock which are
exercisable at $1.50 per share. In January 2003, we were paid
25,000 shares of restricted Genesis common stock and 37,500
warrants to purchase Genesis common stock and in June we
received 50,000 shares of restricted Genesis common stock and
75,000 warrants to purchase Genesis common stock.
o In June of 2003 we created a video for Vintage Filings Inc.
which is currently on our website and will be available
indefinitely. The Vintage video focused on the services
Vintage could provide to some of the visitors to our website
as well as our clients. We were not paid nor did we charge a
fee for this client.
o In July of 2003 we developed a videotape for Skybridge
Wireless, Inc. which will be available on our web site for 6
months. The Skybridge video focused on Skybridge's business
and was intended to introduce the audience to its business
plan , products and services as well as Skybridge's plan to
penetrate the Las Vegas market. We were paid 38,500 free
trading shares of Skybridge Common Stock for this service.
o In September 2003 we created a video with Neil Kaufman, Esq.
which is currently on our website and will be available
indefinitely. The topic of this video was a discussion of the
Sarbanes-Oxley Act of 2003. We were not paid nor did we
charge a fee for this client.
o In October of 2003, we created a video for Humana Trans
Services Holding Corp. which is currently on our website. The
video focused on the services the company provides to its
clients as well as reasons why a new director has joined the
company's board of directors. For the production and hosting
of the video for a three month period we received $6,500 and
20,000 free trading shares of Humana common stock.
As an additional service, we will host videotapes not created or
produced by us for clients desiring exposure on our website. Currently, we host
a video by The BioBalance Corporation which we were paid $2,500 for this hosting
service. This video focuses on the product Probatrix , a food which BioBalance
claims helps offset the effects of certain types of Irritable Bowel Syndrome.
As we evaluate the material terms of each project on a project by
project basis, we do not have a set fee for our services and do not foresee
changing that at any time in the near future. We determine our fees by using a
two-step approach. First, we analyze a prospective client's needs. Second, if we
conclude that we can help that party achieve its goals, we then attempt to
develop and agree upon, with that party, the types of services we will provide.
Show Concept
As we believe our experience in video production for internet
dissemination is transferable to a great extent to the production of television
shows, we are planning on expanding our operations into such area. The Show
Concept starts with identification of the client. Once the client has been
identified we anticipate initially subcontracting the actual production needs to
available production studios. We will undertake to obtain the airtime through
our own efforts. Although we have no formal agreement, we have used Pro Image
Studios and Real Tyme Productions in the past and would consider them for future
productions. At this time we are not dependent on any one particular company.
With respect to the broadcast of the program, we anticipate the
timeframe necessary to obtain clients will vary from company to company. We
expect that it will take approximately 30 days from the date we actually begin
marketing our show concept to the public to identify and agree to terms with our
first client. The timeframe for the actual production will vary depending on the
client's needs, however, our goal is to reach a 30 day turnaround from
19
pre-production to post-editing. The costs associated with identifying clients
are marketing related. Although the production cost can vary due to the clients
needs, an initial production cost for our first show is expected to be
approximately $50,000. The cost for broadcasting will depend on the amount of
airtime we purchase. We intend to use the proceeds of this offering to fund the
initial programs, but in the future expect to have companies pay as well as sell
commercial airtime within the 30 minute episode.
Sample Show Time-Line and Expenses
As the funding for the development of the show concept is wholly
dependent on the sale of our common stock, we are unable to commit to a certain
date upon which production will begin. In the event that we raise enough dollars
to produce a minimum of one program, the costs of which we estimate to be
$50,000, we would anticipate starting production within 30 days of receiving the
funding.
WEEK ONE: Selection of companies. Scripting, casting and/or creating a
theme, for example a bio tech, high tech or entertainment theme. Set up the
video location and reserve shoot times. Assuming we have agreed to terms with
four companies, we would anticipate to start shooting on days 4 and 5.
WEEK TWO: Continue filming each company with the goal of completing all
filming and "B roles" by the end of the second week.
WEEK THREE: Begin the "content" editing process as well as produce and
edit all disclaimers, introductions with the goal of creating a 28-30 min.
segment (depending on the amount, if any, of commercial time sold for such
production). This process shall also include any voiceovers, on screen graphics
and background music. By the end of the week 3 we would expect to have an audio
video interleave ("AVI") file. An AVI file is the most common format for
audio/video data used in the world today.
WEEK FOUR: In the fourth week we anticipate digitizing the production
and converting such digital file into the various mediums we will use. The first
step of the digitization process will begin by converting the AVI files into the
different media files at various "streamable" speeds. As visitors connect to our
site connect at various data speeds (ie. 56k, 256k, LAN, Cable Modem and ISDN)
we need to be able to present our videos in each of the various formats. In
addition to internet access, once we complete the digitizing process we will
convert the file to both VHS and CD-ROM broadcast mediums and will be in a
position to broadcast the video upon the completion of this stage.
Although we anticipate offering more competitive rates than the
industry standard, the approximate costs associated with a half-hour television
program, exclusive of on-air talent and marketing fees, are as follows:
o Creative and pre-production - $15,000
o Production Crew - $25,000
o Camera and Equipment Rental - $5,000
o Miscellaneous Production Expenses - $2,500
We plan to distribute our television shows on network and or cable
television. There is a high level of competition in our anticipated field. Some
of this competition arises from very large companies in the broadcasting
business with substantially greater market recognition and financial resources
than us. Our plan to compete with these entities starts with bringing our
production to market. Once the production is brought to market we hope to secure
the same advertising dollars as our competition.
Videoconferencing Services
We have also expanded our scope of business to include
videoconferencing services. We can now produce an internet video by conducting
an interview from our corporate office and have interviewees at a number of
different locations throughout the U.S. We use the services and equipment of our
lessor, HQ Global Workplaces. Presently there is a global market place for these
services. We plan to disseminate the interviews on our website.
20
There is a high level of competition in the videoconferencing field. Some of
this competition arises from very large companies in the field with
substantially greater market recognition and financial resources than us. We do
not plan to compete with other videoconference service providers. The principal
supplier of the videoconferencing services is HQ Global Workforces. We are not
contractually bound to use them and can therefore move quickly to take advantage
of any marketplace developments that occur which result in more competitive
terms. To date, we have generated no revenue as a result of these services.
Revenue Breakdown
We recognize revenue at the time that all services have been
substantially completed. We may receive equity securities in certain entities as
payments for services provided for these entities. Some of these entities are
newly formed, have no operating history, and the market for such securities is
very limited. Since there is no assurance that these securities are marketable,
we have not recognized any revenue upon receipt. Revenue will be recorded at the
time we sell any of these securities. The amount of shares we will accept in
lieu of a portion of a client's cash payment is situation specific. Such amount
is never contingent on the success or failure of our efforts.
Marketing Approach
Our current marketing plan includes "key word" marketing on major
Internet search engines like Lycos, Alta Vista, MSN and Yahoo! We have an
agreement with Overture, a commercial paid search service on the Internet, which
will provide CRS with access to the "Overture Distribution Network" -- a network
of Web properties that have integrated Overture's search service into their
Websites or direct user traffic to Overture's Website. CRS submits bids to
Overture Services, Inc., with respect to certain key words they have the rights
to, such as "corporate presentations." The higher our bid is in relation to
other potential bidders the higher priority we receive with respect to a search
engine. For example, a potential client searching the term "Corporate
Presentations" on the Internet may see our name at the top of a particular
search engine list, enabling us to target a spectrum of the public presently in
the market for services offered by us. CRS pays for the bid price for "clicks"
on the search listings in both Overture's Website, as well as third party
products. Our average monthly costs have ranged from a high of $1,500 to a low
of $200. Such range is a result of the number of "hits" we receive as a result
of an Overture "term" that we have bid on and won.
We also have a contract, expiring February 11, 2004, with Dynamic
Distribution Corp. whereby we will pay Dynamic a five (5%) percent fee for any
new business introduced to us as a result of Dynamic's efforts. For example, if
Dynamic introduces us to potential clients who ultimately generate $10,000 of
new business we would be obligated to pay Dynamic five-percent of that $10,000
or $500.
Strategic Relationships
On June 18, 2001 CRS was accepted as a member of the American Express
Affiliate Program- part of the Linkshare Network (TM). As an American Express
Affiliate, CRS can earn anywhere from $25 to $45 for each new customer the CRS
site generates for American Express. The commission structure is based on the
product that is sold. The following is the commission breakdown: Consumer cards
$30, Small Business Corporate cards $45, Membership Banking $35 and Merchant
Services $25. To date, we have generated less than $50 in revenue as a result of
this relationship.
Competition
We believe that as a provider of promotional and marketing services to
small and mid-capitalized public companies we have few direct competitors and
those that do exist are left to share a potentially significant market. Some of
our biggest competitors are MoneyTV, BATV and Yahoo! Net Roadshow. MoneyTV and
BATV are restricted solely to producing television programs focused on their
clients, while Yahoo! Net Roadshow also appears to have been involved in
web-based production in the recent past. Although most of the online financial
providers do not yet offer similar services to our own, as the barriers to entry
are reasonably low, any of such companies (such as The Street.Com,
MarketWatch.Com, and the Motley Fool) could quickly build in such services and
become direct competitors to CRS.
21
Trademarks and Patents
On February 19, 2003 we filed a service mark application with the
United States Patent and Trademark Office.
Current Position in the Industry
As we are relatively new to the industry we have limited resources from
which to draw. However, as stated earlier, we believe that the industry is
young, the present competition is minimal and the potential size of the industry
should more than mitigate that fact. The greatest risk to our business is not
our competition, but that we will be unable to convince prospective clients that
our services are worth the fees we charge.
Governmental Regulations
We are not aware of any existing or probable governmental regulations
which will have a material effect on our business nor do we need any
governmental approval to produce our half-hour television show.
In order to avoid and potential securities law matters, we clearly
direct all visitors to our website to our General Disclaimer section where we
state that we are not soliciting to purchase or sell securities and that any
interested party should perform its own independent research into the companies
featured on our website. We further disclose all equity holdings that we have in
such companies.
In order to ensure that our clients are not presently offering
securities and will not contemplate the offering of securities at any time the
video is available for viewing on our website, we require each client to
acknowledge in writing that they are not presently offering securities and will
not contemplate offering securities while their video is available for viewing
on our website.
Currently, we do not meet the classification as an "Investment Company"
as that term is defined in the Investment Company Act of 1940 because the
securities we hold in our featured companies do not comprise 40 percent of our
total assets nor do we primarily engage in the business of investing,
reinvesting or trading in securities. We will continue to monitor that
"securities component" level of forty (40%) percent very carefully to ensure
that we never fall under that classification. Some of the securities we have
received as partial payment for our services are restricted and therefore must
be held for a period of time. Our intent is not to hold such securities for the
long term but rather sell any available securities as soon as we are no longer
restricted pursuant to the securities laws and such securities have a value
equal to or exceeding the value of services rendered by us at the time they were
received. In the event that we ever approach the "Investment Company" threshold,
we will re-evaluate our policy of accepting securities as partial payment for
services rendered.
The Investment Advisers Act of 1940 does not apply to our activities as
we are not providing to the public any type of investment advice or analysis
with respect to our clients.
Employees
Currently, we have 2 full-time employees. Neither of our employees are
represented by a labor union. We consider our relationship with our employees to
be satisfactory.
Properties
On November 13, 2002 we entered into a Lease Agreement for one office
for a period of twelve months with HQ Global Workplaces for an aggregate rent of
$15,000. There is no affiliation between any of our officers or directors with
HQ.
Seasonality
We have not found our business to be seasonal in nature.
22
Legal Proceedings
We are not a party to any pending legal proceeding nor are any legal
actions contemplated by us at this time.
23
MANAGEMENT
Directors
Presently, Mr. Frank Ferraro is the only member of our Board of
Directors and was appointed to the Board in 1999. Mr. Ferraro has served
consecutive three-year terms of which the current term expires in November of
2005.
The following table sets forth the name and, as of September 30, 2003,
age and position of each director and executive officer of our company.
Name Age Position
---- --- --------
Frank Ferraro 39 Chairman, President, Secretary and Treasurer
Vincent Epifanio 39 Senior Vice President
Background of Executive Officers, Directors and Significant Employees
Frank Ferraro has been the Chief Executive Officer and President since
inception. Mr. Ferraro has spent the last sixteen years in the financial field.
Since April of 1996 Mr. Ferraro has been dually licensed with both Castle and
Citadel Securities, respectively as a registered representative. Both Castle and
Citadel are registered broker-dealers. With both Castle and Citadel, Mr. Ferraro
helped develop and manage an electronic internet based proprietary trading
system as well as a manager of a trading desk. Mr. Ferraro graduated from
Hofstra University with a B.B.A. in Accounting in 1986. On April 28, 2003, Mr.
Ferraro resigned from Castle Securities and Citadel Securities Corp.,
respectively.
Vincent Epifanio joined us as our Vice President of Sales and Marketing
in January 2003. Mr. Epifanio has been a sales specialist for over 15 years.
Most recently prior to CRS from September 1994 to December 2002, Mr. Epifanio
was an Account/Sales Manager for Starpoint Solutions, a full service
consulting/software firm with revenues over $80 million annually specializing in
the Banking and Brokerage industry. During his tenure with Starpoint, Mr.
Epifanio, built his personal sales base to over $4 million annually. Mr.
Epifanio graduated from Binghamton University in 1987 with a dual B.S. degree in
Computer Science and Industrial Engineering.
Compensation of Directors
We do not pay our Director any fee in connection with his role as member of
our Board. Our Director is reimbursed for travel and out-of-pocket expenses in
connection with his attendance at Board meetings.
Employment Agreements
On January 1, 2003 we entered into an employment agreement with Mr.
Frank Ferraro, our Chief Executive Officer and Chairman of the Board, for a term
of two (2) years commencing on such date, providing for an annual salary of
$90,000. In addition to his annual salary, Mr. Ferraro has the right to
participate in any share option plan, share purchase plan, retirement plan or
similar plan offer by our company, to the extent authorized by our Board. Mr.
Ferraro also has the right to have CRS pay for a car of its choosing including
all expenses associated therewith.
We have not entered into an employment agreement with our other
employee, Mr. Epifanio. Through June 30, 2003, Mr. Epifanio received a salary of
$1,250 per week. However, subsequent to that date, Mr. Epifanio has agreed to be
compensated strictly on a commission basis, the terms of which have not been
finalized as of the date hereof.
24
EXECUTIVE COMPENSATION
The following Summary Compensation Table sets forth certain information
regarding the compensation of our Chief Executive Officer and our other
executive employee as of September 30, 2003.
Summary Compensation Table
Option Grants During Last Fiscal Year
Although we adopted a Stock Option Plan in February of 2003, we have
yet to award any options under such plan.
Summary of 2003 Stock Option Plan
Qualified directors, officers, employees, consultants and advisors of
ours and our subsidiaries are eligible to be granted (a) stock options
("Options"), which may be designated as nonqualified stock options ("NQSOs") or
incentive stock options ("ISOs"), (b) stock appreciation rights ("SARs"), (c)
restricted stock awards ("Restricted Stock"), (d) performance awards
("Performance Awards") or (e) other forms of stock-based incentive awards
(collectively, the "Awards"). A director, officer, employee, consultant or
advisor who has been granted an Option is referred to herein as an "Optionee"
and a director, officer, employee, consultant or advisor who has been granted
any other type of Award is referred to herein as a "Participant."
The Omnibus Committee administers the Stock Option Plan and has full
discretion and exclusive power to (a) select the directors, officers, employees,
consultants and advisors who will participate in the Stock Option Plan and grant
Awards to such directors, officers, employees, consultants and advisors, (b)
determine the time at which such Awards shall be granted and any terms and
conditions with respect to such Awards as shall not be inconsistent with the
provisions of the Stock Option Plan, and (c) resolve all questions relating to
the administration of the Stock Option Plan. Members of the Omnibus Committee
receive no additional compensation for their services in connection with the
administration of the Stock Option Plan.
- --------
(1) Based on a salary of $1,250 per week. However, as of July 1, 2003 Mr.
Epifanio has been compensated purely on a commission basis which through
September 30 2003 has been minimal.
25
The Omnibus Committee may grant NQSOs or ISOs that are evidenced by
stock option agreements. A NQSO is a right to purchase a specific number of
shares of common stock during such time as the Omnibus Committee may determine,
not to exceed ten (10) years, at a price determined by the Omnibus Committee
that, unless deemed otherwise by the Omnibus Committee, is not less than the
fair market value of the common stock on the date the NQSO is granted. An ISO is
an Option that meets the requirements of Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code"). No ISOs may be granted under the Stock
Option Plan to an employee who owns more than 10% of our outstanding voting
stock ("Ten Percent Stockholder") unless the option price is at least 110% of
the fair market value of the common stock at the date of grant and the ISO is
not exercisable more than five (5) years after it is granted. In the case of an
employee who is not a Ten Percent Stockholder, no ISO may be exercisable more
than ten (10) years after the date the ISO is granted and the exercise price of
the ISO shall not be less than the fair market value of the common stock on the
date the ISO is granted. Further, no employee may be granted ISOs that first
become exercisable during a calendar year for the purchase of common stock with
an aggregate fair market value (determined as of the date of grant of each ISO)
in excess of $100,000USD. An ISO (or any installment thereof) counts against the
annual limitation only in the year it first becomes exercisable.
The exercise price of the common stock subject to a NQSO or ISO may be
paid in cash or, at the discretion of the Omnibus Committee, by a promissory
note or by the tender of common stock owned by the Option holder or through a
combination thereof. The Omnibus Committee may provide for the exercise of
Options in installments and upon such terms, conditions and restrictions as it
may determine.
A SAR is a right granted to a Participant to receive, upon surrender of
the right, but without payment, an amount payable in cash. The amount payable
with respect to each SAR shall be based on the excess, if any, of the fair
market value of a share of common stock on the exercise date over the exercise
price of the SAR, which will not be less than the fair market value of the
common stock on the date the SAR is granted. In the case of an SAR granted in
tandem with an ISO to an employee who is a Ten Percent Stockholder, the exercise
price shall not be less than 110% of the fair market value of a share of common
stock on the date the SAR is granted.
Restricted Stock is common stock that is issued to a Participant at a
price determined by the Omnibus Committee, which price per share may not be less
than the par value of the common stock, and is subject to restrictions on
transfer and/or such other restrictions on incidents of ownership as the Omnibus
Committee may determine.
A Performance Award granted under the Stock Option Plan (a) may be
denominated or payable to the Participant in cash, common stock (including,
without limitation, Restricted Stock), other securities or other Awards and (b)
shall confer on the Participant the right to receive payments, in whole or in
part, upon the achievement of such performance goals during such performance
periods as the Omnibus Committee shall establish. Subject to the terms of the
Stock Option Plan and any applicable Award agreement, the performance goals to
be achieved during any performance period, the length of any performance period,
the amount of any Performance Award granted and the amount of any payment or
transfer to be made pursuant to any Performance Award shall be determined by the
Omnibus Committee.
The Omnibus Committee may grant Awards under the Stock Option Plan that
provide the Participants with the right to purchase common stock or that are
valued by reference to the fair market value of the common stock (including, but
not limited to, phantom securities or dividend equivalents). Such Awards shall
be in a form determined by the Omnibus Committee (and may include terms
contingent upon a change of control of CRS); provided that such Awards shall not
be inconsistent with the terms and purposes of the Stock Option Plan.
The Omnibus Committee determines the price of any such Award and may
accept any lawful consideration.
The Omnibus Committee may at any time amend, suspend or terminate the
Stock Option Plan; provided, however, that (a) no change in any Awards
previously granted may be made without the consent of the holder thereof and (b)
no amendment (other than an amendment authorized to reflect any merger,
consolidation, reorganization or the like to which we are a party or any
reclassification, stock split, combination of shares or the like) may be made
increasing the aggregate number of shares of the common stock with respect to
which Awards may be granted or changing the class of persons eligible to receive
Awards, without the approval of the holders of a majority of our outstanding
voting shares.
26
In the event a Change in Control (as defined in the Stock Option Plan)
occurs, then, notwithstanding any provision of the Stock Option Plan or of any
provisions of any Award agreements entered into between any Optionee or
Participant and us to the contrary, all Awards that have not expired and which
are then held by any Optionee or Participant (or the person or persons to whom
any deceased Optionee's or Participant's rights have been transferred) shall, as
of such Change of Control, become fully and immediately vested and exercisable
and may be exercised for the remaining term of such Awards.
Although we have no intentions of merging, consolidating or otherwise
reorganizing, if we are a party to any merger, consolidation, reorganization or
the like, the Omnibus Committee has the power to substitute new Awards or have
the Awards be assumed by another corporation. In the event of a
reclassification, stock split, combination of shares or the like, the Omnibus
Committee shall conclusively determine the appropriate adjustments.
No Award granted under the Stock Option Plan may be sold, pledged,
assigned or transferred other than by will or the laws of descent and
distribution, and except in the case of the death or disability of an Optionee
or a Participant, Awards shall be exercisable during the lifetime of the
Optionee or Participant only by that individual.
No Awards may be granted under the Stock Option Plan on or after
February 14, 2013, but Awards granted prior to such date may be exercised in
accordance with their terms.
The Stock Option Plan and all Award agreements shall be construed and
enforced in accordance with and governed by the laws of New York.
As of September 30, 2003, of the 1,000,000 shares of common stock
reserved for issuance under the Stock Option Plan, we have not issued any
options to acquire no shares of common stock were granted under the Stock Option
Plan.
Other
No director or executive officer is involved in any material legal
proceeding in which he is suing us or in which he will receive a benefit from
the legal proceedings.
CODE OF ETHICS
As we presently have only two employees, we have not yet found the need
to adopt a code of ethics. However, it is our intent to adopt such a code with
respect to our executive officers once we have a minimum of 5 full-time
employees.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
For a description of employment contracts with executive officers,
please refer to the section entitled Executive Compensation - Employment
Contracts.
Frank Ferraro, our founder, holds approximately ninety-one (91%)
percent of our outstanding common stock prior to the issuance of any shares
related to this Prospectus. Mr. Ferraro is our Chairman, President and Chief
Executive Officer.
27
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES
Our articles of Incorporation and By-Laws provide that our directors
and officers will not be personally liable to us or our stockholders for
monetary damages due to the breach of a fiduciary duty as a director or officer.
New York Business Corporation Law Section 722, provides that we may indemnify
any officer, director, employee or agent who is party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, provided he was acting in good faith and in a manner which he
reasonably believed to be in, or not opposed to, our best interests, and, with
respect to any criminal action or proceeding, he had no reasonable cause to
believe that his conduct was unlawful. The indemnification includes all actual
and reasonable expenses, including attorney's fees, judgments, fines and
settlement amounts. The termination of any action, suit or proceeding by
judgment, order, settlement or conviction, does not of itself prevent
indemnification so long as the officer or director acted in good faith and in a
manner which he reasonably believed to be in, or not opposed to, our best
interests, or, with respect to any criminal action or proceeding, he had no
reasonable cause to believe that his conduct was unlawful.
In addition, New York Business Corporation Law Section 722 provides
that we may indemnify any officer, director, employee or agent who is party to
any threatened, pending or completed action or suit brought by us or by our
stockholders on our behalf, provided he was acting in good faith and in a manner
which he reasonably believed to be in, or not opposed to, our best interests.
The indemnification includes all actual and reasonable expenses, including
attorney's fees, judgments, fines and settlement amounts. However,
indemnification is prohibited as to any suit brought in our right in which the
director or officer is adjudged by a court to be liable to us.
To the extent that the officer or director is successful on the merits
in any proceeding pursuant to which such person is to be indemnified, we must
indemnify him against all actual and reasonable expenses incurred, including
attorney's fees.
The foregoing indemnity provisions will limit your ability as
shareholders to hold officers and directors liable and collect monetary damages
for breaches of fiduciary duty, and require us to indemnify officers and
directors to the fullest extent permitted by law.
To the extent that indemnification may be available to our directors
and officers for liabilities arising under the Securities Act, we have been
advised that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy and therefore unenforceable.
28
Security Ownership Of Certain Beneficial Owners And Management
The following table sets forth, as of September 30, 2003, information
regarding the beneficial ownership of our common stock by each person we know to
own five percent or more of the outstanding shares, by each of the directors and
officers. As of September 30, 2003, there were 5,730,000 shares of our common
stock outstanding.
Beneficial ownership has been determined in accordance with Rule 13d-3
of the Exchange Act. Generally, a person is deemed to be the beneficial owner of
a security if he has the right to acquire voting or investment power within 60
days. Subject to community property laws, where applicable, the persons or
entities named in the table above have sole voting and investment power with
respect to all shares of our common stock indicated as beneficially owned by
them.
The following table sets forth information concerning the beneficial
ownership of shares of our Common Stock with respect to stockholders who were
known by us to be beneficial owners of more than 5% of our Common Stock as of
September 30, 2003. Unless otherwise indicated, the beneficial owner has sole
voting and investment power with respect to such shares of Common Stock.
Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or investment
power with respect to securities. In accordance with the Securities and Exchange
Commission rules, shares of our Common Stock which may be acquired upon exercise
of stock options or warrants which are currently exercisable or which become
exercisable within sixty (60) days of the date of the table are deemed
beneficially owned by the optionees. Subject to community property laws, where
applicable, the persons or entities named in the table above have sole voting
and investment power with respect to all shares of our Common Stock indicated as
beneficially owned by them. Percentage ownership is based on 5,730,000 shares of
Common Stock outstanding as of September 30, 2003 and 2,000,000 additional
shares of Common Stock to be issued in this offering.
There is no public trading market for our shares of common stock. In
addition to Mr. Frank Ferraro our President, we have one other shareholder as
found below. For a discussion regarding our dividend policy as related to our
common stock please see "Description of Securities."
- ----------
(1) Includes 200,000 shares of common stock held by Mr. Ferraro's wife.
29
SELLING SHAREHOLDER
This Prospectus will also be used for the offering of additional shares
of our Common Stock owned by Eli Weinstein. Mr. Weinstein may offer for sale up
to 100% (500,000 shares) of his holdings in our Common Stock. Mr. Weinstein may
offer for sale such shares of our Common Stock from time to time in the open
market, in privately negotiated transactions or otherwise. We will not receive
any proceeds from such sales. The resale of the securities by Mr. Weinstein is
subject to the prospectus delivery and other requirements of the Securities Act.
DESCRIPTION OF SECURITIES
General
The following description of our capital stock does not purport to be
complete and is subject to and qualified in its entirety by our Articles of
Incorporation, as amended, and By-laws, which are included as exhibits to the
registration statement of which this prospectus forms a part, and by the
applicable provisions of New York law.
We are authorized to issue 20,000,000 shares of common stock, $0.0001
par value per share, of which 5,730,000 shares were issued and outstanding as of
September 30, 2003.
Common Stock
Holders of shares of our common stock are entitled to share equally on
a per share basis in such dividends as may be declared by our Board of Directors
out of funds legally available therefor. There are presently no plans to pay
dividends with respect to the shares of our common stock. Upon our liquidation,
dissolution or winding up, after payment of creditors and the holders of any of
our senior securities, if any, our assets will be divided pro rata on a per
share basis among the holders of the shares of our common stock. The common
stock is not subject to any liability for further assessments. There are no
conversion or redemption privileges or any sinking fund provisions with respect
to the common stock. The holders of common stock do not have any pre-emptive or
other subscription rights.
Holders of shares of common stock are entitled to cast one vote for
each share held at all stockholders' meetings for all purposes, including the
election of directors. The common stock does not have cumulative voting rights.
As of September 30, 2003 we have five shareholders.
30
Dividend
We have never declared or paid any cash dividends on our common stock.
We anticipate that any earnings will be retained for development and expansion
of our business and we do not anticipate paying any cash dividends in the near
future. Our Board of Directors has sole discretion to pay cash dividends with
respect to our common stock based on our financial condition, results of
operations, capital requirements, contractual obligations and other relevant
factors.
Shares Eligible for Future Sale
Upon completion of this offering and assuming the maximum number of
shares are sold, we will have 7,730,000 shares of common stock outstanding. Of
these shares, 2,500,000 shares of common stock will be freely tradeable without
further restriction or further registration under the Securities Act, as
amended, accept for those shares purchased by an "affiliate" of CRS (in general,
a person who has a control relationship with CRS) which will be subject to the
limitation of Rule 144 adopted under the Securities Act. The remaining shares
(5,230,000) are deemed to be "restricted securities," as that term is defined
under Rule 144 promulgated under the Securities Act.
Preferred Stock
We are not authorized to issue any shares of preferred stock.
Transfer Agent and Registrar
Our transfer agent is Olde Monmouth Stock Transfer Co., Inc., 200
Memorial Pkwy, Atlantic Highlands, N.J. 07716. Their phone number is
732/872-2727.
Resale Restrictions
All of our shares of common stock issued prior to this offering are
"restricted securities" as this term is defined under Rule 144, in that such
shares were issued in private transactions not involving a public offering and
may not be sold in the U.S. in the absence of registration other than in
accordance with Rule 144 under the Securities Act of 1933, as amended, or
another exemption from registration. In general, under Rule 144 as currently in
effect, any of our affiliates or any person (or persons whose shares are
aggregated in accordance with Rule 144) who has beneficially owned our common
shares which are treated as restricted securities for at least one (1) year
would be entitled to sell within any three-month period a number of shares that
does not exceed the greater of 1% of our outstanding common shares
(approximately 75,000 shares based upon the number of common shares expected to
be outstanding after the offering) or the reported average weekly trading volume
in our common shares during the four weeks preceding the date on which notice of
such sale was filed under Rule 144. Sales under Rule 144 are also subject to
manner of sale restrictions and notice requirements and to the availability of
current public information concerning our company. In addition, affiliates of
our company must comply with the restrictions and requirements of Rule 144
(other than the one (1) year holding period requirements) in order to sell
common shares that are not restricted securities (such as common shares acquired
by affiliates in market transactions). Furthermore, if a period of at least two
(2) years has elapsed from the date restricted securities were acquired from us
or from one of our affiliates, a holder of these restricted securities who is
not an affiliate at the time of the sale and who has not been an affiliate for
at least three (3) months prior to such sale would be entitled to sell the
shares immediately without regard to the volume, manner of sale, notice and
public information requirements of Rule 144.
Upon closing of this offering, we intend to file a registration
statement for the resale of the common shares that are authorized for issuance
under our existing and new stock option plans. We expect this registration
statement to become effective immediately upon filing. Shares issued pursuant to
our stock option plans to U.S. residents after the effective date of that
registration statement (other than shares issued to our affiliates and the
employees described below) generally will be freely tradable without restriction
or further registration under the Securities Act of 1933.
31
Private Placement
From June through October 2002, we issued an aggregate of 500,000
shares of common stock to one individual for a total of $500,000. The proceeds
from the sale were used to pay for the expenses associated with the development
and introduction of our website as well as general operating expenses.
Penny Stock Considerations
Broker-dealer practices in connection with transactions in penny stocks
are regulated by certain penny stock rules adopted by the Securities and
Exchange Commission. Penny stocks generally are equity securities with a price
of less than US$ 5.00. Penny stock rules require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized risk disclosure document that provides information about penny
stocks and the risks in the penny stock market. The broker-dealer also must
provide the customer with current bid and offer quotations for the penny stock,
the compensation of the broker-dealer and its salesperson in the transaction,
and monthly account statements showing the market value of each penny stock held
in the customer's account. In addition, the penny stock rules generally require
that prior to a transaction in a penny stock, the broker-dealer make a special
written determination that the penny stock is a suitable investment for the
purchaser and receive the purchaser's written agreement to the transaction.
These disclosure requirements may have the effect of reducing the level of
trading activity in the secondary market for a stock that becomes subject to the
penny stock rules. Our shares may be subject to such penny stock rules and our
shareholders will, in all likelihood, find it difficult to sell their
securities.
PLAN OF DISTRIBUTION
Shares being registered on the company's behalf
We are registering 2,000,000 shares of our common stock which shall be
offered and sold on a self-underwritten basis by Mr. Frank Ferraro our Chief
Executive Officer and President, or, at our discretion, by participating
broker-dealers licensed by the National Association of Securities Dealers, Inc.
Mr. Ferraro will be the person responsible for the sales of securities on behalf
of CRS and that he will rely on the safe harbor from broker dealer registration
set out in Rule 3a4-1 under the Securities Exchange Act of 1934. Mr. Ferraro
meets each of the qualifications set forth in such rule as follows: (i) he is
not subject to any statutory disqualification; (ii) he is not compensated in
connection with his participation by the payment of commissions or other
remuneration based either directly or indirectly on transactions in securities;
(iii) he is not at the time of his participation an associated person of a
broker or dealer; and (iv) he will restrict his participation with respect to
such sales to the following activities: (A) preparing any written communication
or delivering such communication through the mails or other means that does not
involve oral solicitation by the associated person of a potential purchaser;
provided, however, that the content of such communication is approved by a
partner, officer or director of the issuer; (B) responding to inquiries of a
potential purchaser in a communication initiated by the potential purchaser;
provided, however, that the content of such responses are limited to information
contained in a registration statement filed under the Securities Act of 1933 or
other offering document; or (C) Performing ministerial and clerical work
involved in effecting any transaction.
Although we anticipate being listed on the OTC-Bulletin Board
concurrently with the effectiveness of this Prospectus, we may not be.
Regardless, we will offer the shares to the public at a price of $1.00 per
share. There is no minimum investment requirement and funds received by us from
this offering will not be placed into an escrow account. The offering price of
the shares was arbitrarily determined by us. The offering price of the shares
does not have any relationship to our assets, book value, or earnings. We
reserve the right to reject any subscription in whole or in part, for any reason
or for no reason. There can be no assurance that we will sell any or all of the
offered shares.
As our offering is "self-underwritten" in nature and at a fixed price
of $1.00 per share, we are unsure whether we will sell any shares of common
stock. As a result, we are unable at this time to determine what State, if any,
offers or sales will be made. We may also seek out broker-dealers to assist us
in placing our stock. Regardless
32
of whether we place our stock ourselves or through agents, we will comply with
all applicable blue sky requirements of each jurisdiction in which we ultimately
offer and sell our shares. We intend to register the shares of common stock in
both New York and New Jersey. We will not use the services of either Castle or
Citadel Securities in offering these securities. Neither will we solicit the
clients of those entities.
Under the Securities Exchange Act of 1934 and the regulations
thereunder, any person engaged in a distribution of the shares of our common
stock offered by this prospectus may not simultaneously engage in market making
activities with respect to our common stock during the applicable "cooling off"
periods prior to the commencement of such distribution.
Shares being registered on the selling shareholder's behalf
We are also registering 500,000 shares of our common stock held by Mr.
Eli Weinstein, the selling shareholder, on his behalf. Prior to the listing of
our securities on the OTC Bulletin Board, Mr. Weinstein has agreed to sell his
shares at a price of $1.00. Once our securities are listed on the OTC Bulletin
Board the selling shareholder may sell some or all of such shares at any price.
The shares will not be sold in an underwritten public offering.
Broker-dealers engaged by the selling shareholder may arrange for other
broker-dealers to participate. Broker-dealers may receive commissions or
discounts from the selling shareholder (or, if any such broker-dealer acts as
agent for the purchaser of such shares, from such purchaser) in amounts to be
negotiated. Broker-dealers may agree with the selling shareholder to sell a
specified number of such shares at a stipulated price per share.
The selling shareholder and any broker-dealers participating in the
distributions of the shares may be deemed to be "underwriters" within the
meaning of Section 2(11) of the Securities Act. Any profit on the sale of shares
by the selling shareholder and any commissions or discounts given to any such
broker-dealer may be deemed to be underwriting commissions or discounts. The
shares may also be sold pursuant to Rule 144 under the Securities Act of 1933,
as amended, beginning one (1) year after the shares were issued.
Under the Securities Exchange Act of 1934 and the regulations
thereunder, any person engaged in a distribution of the shares of our Common
Stock offered by this prospectus may not simultaneously engage in market making
activities with respect to our Common Stock during the applicable "cooling off"
periods prior to the commencement of such distribution. Also, the selling
shareholder is subject to applicable provisions that limit the timing of
purchases and sales of our Common Stock by the selling shareholder.
We have informed the selling shareholder that, during such time as he
may be engaged in a distribution of any of the shares we are registering by this
prospectus, he is required to comply with Regulation M. In general, Regulation M
precludes the selling shareholder, any affiliated purchasers and any
broker-dealer or other person who participates in a distribution from bidding
for or purchasing, or attempting to induce any person to bid for or purchase,
any security which is the subject of the distribution until the entire
distribution is complete. Regulation M defines a "distribution" as an offering
of securities that is distinguished from ordinary trading activities by the
magnitude of the offering and the presence of special selling efforts and
selling methods. Regulation M also defines a "distribution participant" as an
underwriter, prospective underwriter, broker, dealer, or other person who has
agreed to participate or who is participating in a distribution.
Regulation M prohibits any bids or purchases made in order to stabilize
the price of a security in connection with the distribution of that security,
except as specifically permitted by Rule 104 of Regulation M. These stabilizing
transactions may cause the price of our Common Stock to be less volatile than it
would otherwise be in the absence of these transactions. We have informed the
selling shareholder that stabilizing transactions permitted by Regulation M
allow bids to purchase our Common Stock if the stabilizing bids do not exceed a
specified maximum. Regulation M specifically prohibits stabilizing that is the
result of fraudulent, manipulative, or deceptive practices. The selling
shareholder and distribution participants are required to consult with their own
legal counsel to ensure compliance with Regulation M.
33
LEGAL MATTERS
The validity of the shares has been passed upon for us by our counsel,
Spitzer & Feldman P.C.
34
EXPERTS
The financial statements of Corporate Road Show.com Inc. at December
31, 2002 and December 31, 2001 appearing in this registration statement have
been audited by Lazar Levine & Felix LLP our independent auditor.
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN GIVEN ANY INFORMATION OR
HAS BEEN AUTHORIZED TO MAKE ANY REPRESENTATIONS OTHER THAN THE INFORMATION
CONTAINED OR INCORPORATED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY US, BY THE SELLING STOCKHOLDER OR BY ANY OTHER PERSON. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES
CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN OUR AFFAIRS SINCE THE
DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SHARES DESCRIBED
IN THIS PROSPECTUS OR AN OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY SUCH
SHARES IN ANY CIRCUMSTANCES IN, WHICH SUCH OFFER, OR SOLICITATION IS UNLAWFUL.
WHERE YOU CAN FIND MORE INFORMATION
The effectiveness of this registration statement will render us subject
to the informational requirements of the Exchange Act, and, we will file
reports, proxy statements and other information with the Securities and Exchange
Commission as required by federal law. These reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Securities Exchange Commission Investors may read and copy any
of these reports, statements, and other information at the SEC's public
reference room located at 450 5th Street, N.W., Washington, D.C., 20549, or any
of the SEC's other public reference rooms. Investors should call the SEC at
1-800-SEC-0330 for further information on these public reference rooms upon
payment of the fees prescribed by the Securities Exchange Commission. These SEC
filings are also available free at the SEC's web site at www.sec.gov.
This prospectus does not contain all of the information set forth in
the registration statement, parts of which are omitted to comply with the rules
and regulations of the Securities Exchange Commission. For further information,
please see the registration statement in its entirety.
35
CORPORATE ROAD SHOW.COM, INC.
(A Development Stage Company)
INDEX
F-1
INDEPENDENT AUDITORS' REPORT
To the Shareholders
Corporate Road Show.com, Inc.
Bohemia, New York
We have audited the accompanying balance sheets of Corporate Road Show.com, Inc.
(a development stage company), as of December 31, 2002 and 2001, and the related
statements of operations, shareholders' equity (deficit) and cash flows for the
years ended December 31, 2002 and 2001 and the cumulative period from inception,
November 1, 1999 through December 31, 2002. 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 audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. 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 audits provide 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 Corporate Road Show.com, Inc.
(a development stage company) and the results of its operations and its cash
flows for the periods mentioned in conformity with accounting principles
generally accepted in the United States of America.
--------------------------------
LAZAR LEVINE & FELIX LLP
New York, New York
January 29, 2003
F - 2
Corporate Road Show.com, Inc.
(A Development Stage Company)
Balance Sheets
See accompanying notes.
F-3
Corporate Road Show.com, Inc.
(A Development Stage Company)
Statements of Operations
See accompanying notes.
F-4
Corporate Road Show.com, Inc.
(A Development Stage Company)
Statement of Shareholders' Equity
See accompanying notes.
F-5
Corporate Road Show.com, Inc.
(A Development Stage Company)
Statements of Cash Flows
See accompanying notes.
F-6
Corporate Road Show.com, Inc.
(A Development Stage Company)
Notes To Financial Statements
December 31, 2002 and 2001
(Information as of and for the Six Months Ended
June 30, 2003 and 2002 is unaudited)
NOTE 1 - DESCRIPTION OF COMPANY:
Corporate Road Show.Com Inc. (the "Company") was organized in the
state of New York on November 1, 1999. The Company is presently an
internet-based marketing operation which produces corporate videos
available on both the worldwide web via its website or in a
hardcopy format. The website serves as a portal for companies to
showcase their products and market their goods and services to the
business and financial communities. The Company has the
capabilities to offer clients custom made "live" and "on demand"
video and audio productions as well as compact disk and DVD copies
by writing, shooting, editing and prepping in-house as well as
hosting such presentations on its website.
The Company is considered as being in the development stage, since
its inception, in accordance with Statement of Financial
Accounting Standards No. 7 ("SFAS 7"), and its fiscal year end is
December 31. As shown in the accompanying financial statements,
the Company has generated minimal revenues to date, and incurred
cumulative losses of $344,602 through June 30, 2003.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The Company's accounting policies are in accordance with
accounting principles generally accepted in the United States of
America. Outlined below are those policies considered particularly
significant.
(a) Use of Estimates:
In preparing financial statements in accordance with accounting
principles generally accepted in the United States of America,
management makes certain estimates and assumptions, where
applicable, that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities
at the date of the financial statements, as well as the reported
amounts of revenues and expenses during the reporting period.
While actual results could differ from those estimates, management
does not expect such variances, if any, to have a material effect
on the financial statements.
(b) Statements of Cash Flows:
For purposes of the statements of cash flows the Company considers
all highly liquid investments purchased with a remaining maturity
of three months or less to be cash equivalents.
(c) Fair value:
The Company's financial instruments currently consists of cash and
cash equivalents, accounts payable and debt obligations. The
recorded values of cash and cash equivalents and accounts payable
approximate their fair values based on their short-term nature.
The recorded values of debt obligations approximate their fair
values, as interest approximates market rates.
(d) Fixed Assets:
Fixed assets are recorded at cost. Depreciation and amortization
are provided on a straight-line basis over 5 years.
F-7
Corporate Road Show.com, Inc.
(A Development Stage Company)
Notes To Financial Statements
December 31, 2002 and 2001
(Information as of and for the Six Months Ended
June 30, 2003 and 2002 is unaudited)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued):
(e) Deferred Offering Costs:
The Company, in connection with a proposed offering ("the
Offering") of its securities, has incurred certain costs which
have been deferred and which will be charged against the proceeds
upon completion of the Offering or charged to expense in the event
the Offering is not completed.
(f) Revenue Recognition:
The Company recognizes revenue at the time that all services have
been substantially completed. The Company has received equity
securities in certain entities as payments for services provided
for these entities. Some of these entities are privately owned,
newly formed and have no operating history. Since there is no
assurance that these securities are marketable, the Company has
not recognized any revenue upon receipt. Revenue will be recorded
at the time the securities are determined to have a monetary
value. The Company also receives restricted securities in publicly
traded entities. In such instances, revenue is recorded with a
discount of 75% from the market value at the time of receipt. At
the time that such securities are sold in the public market, the
Company recognizes any resulting gain and/or loss.
(g) Income Taxes:
The asset and liability method is used in accounting for income
taxes. Under this method, deferred tax assets and liabilities are
recognized for operating loss and tax credit carry forwards and
for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases. Deferred
tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The
effect on deferred tax assets and liabilities of a change in tax
rates is recognized in the results of operations in the period
that includes the enactment date. A valuation allowance is
recorded to reduce the carrying amounts of deferred tax assets
unless it is more likely than not that such assets will be
realized.
(h) Loss Per Common Share:
Loss per common share was calculated by dividing the net loss by
the weighted average number of shares outstanding for each period
presented.
(i) Investments/Statement of Comprehensive Income:
Investments in debt and equity securities are classified as
available-for-sale, held-to-maturity or as part of a trading
portfolio in accordance with the provisions of SFAS 115. As of
December 31, 2002 and 2001, the Company had no significant
investments in securities classified as either held-to-maturity or
trading. Securities classified as available-for-sale are carried
at fair value and their unrealized gains and losses, net of tax,
are reported as accumulated other comprehensive income (loss) as a
separate component of shareholders' equity until realized.
Other comprehensive income items under SFAS 130 are transactions
recorded in shareholders' equity during the year, excluding net
income and transactions with shareholders.
F-8
Corporate Road Show.com, Inc.
(A Development Stage Company)
Notes To Financial Statements
December 31, 2002 and 2001
(Information as of and for the Six Months Ended
June 30, 2003 and 2002 is unaudited)
NOTE 3 - DUE TO OFFICER:
The Company had received non-interest bearing advances from its
officer/major shareholder in order to fund its operations. As of
December 31, 2002 and 2001, such advances aggregated $195. The
Company repaid this advance in 2003.
NOTE 4 - SHAREHOLDERS' EQUITY:
In 1999, subsequent to inception, the Company issued 5,200,000
shares of its common stock for $520.
During 2002, the Company issued 500,000 shares of common stock at
a per share price of $1.00, receiving $392,500 in net cash
proceeds. The Company also issued 10,000 shares of common stock in
lieu of payment of professional fees aggregating $10,000.
In 2003 the Company issued 20,000 shares of common stock in lieu
of payment of consulting fees aggregating $20,000.
NOTE 5 - INCOME TAXES:
No provision for Federal and state income taxes has been recorded
since the Company has incurred losses since inception. Deferred
tax assets at December 31, 2002 consist primarily of the tax
effect of the net operating losses that expire in years beginning
in 2011 and which amounts to approximately $133,000 at December
31, 2002 (approximately $282,000 at June 30, 2003). The Company
has provided a 100% valuation allowance on the deferred tax assets
at December 31, 2002 (and June 30, 2003) to reduce such asset to
zero, since there is no assurance that the Company will generate
future taxable income to utilize such asset. Management will
review this valuation allowance periodically and make adjustments
as warranted.
NOTE 6 - COMMITMENTS:
Lease:
Effective December 1, 2002 the Company entered into a lease for
office space and ancillary services. This lease requires monthly
payments of $1,250 and has an initial term of 12 months.
F-9
NOTE 6 - COMMITMENTS (Continued):
Employment Agreements:
On January 1, 2003 the Company entered into an Employment
Agreement with its Chief Executive Officer and Chairman of the
Board, for a term of two (2) years commencing on such date,
providing for an annual salary of $90,000. In addition to his
annual salary, this officer has the right to participate in any
share option plan, share purchase plan, retirement plan or similar
plan offer by the Company, to the extent authorized by the Board.
NOTE 7 - PROPOSED PUBLIC OFFERING:
The Company is currently preparing a registration statement for an
initial public offering of its common stock. The Company intends
to offer 2,500,000 shares of common stock, at $1.00 per share,
which includes 500,000 shares of common stock offered by a selling
stockholder. The Company will not receive any proceeds from the
sale of the shares of common stock being offered by the selling
shareholder.
The shares of Company common stock will be offered and sold on a
self-underwritten basis by using Company officers, directors,
participating licensed broker-dealers or in private transactions.
F-10
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 24. Indemnification of Directors.
CRS's Certificate of Incorporation permits indemnification to the
fullest extent permitted by New York law. CRS's by-laws require CRS to indemnify
any person who was or is an authorized representative of CRS, and who was or is
a party or is threatened to be made a party to any corporate proceeding, by
reason of the fact that such person was or is an authorized representative of
CRS, against expenses, judgments, penalties, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection with
such third party proceeding if such person acted in good faith and in a manner
such person reasonably believed to be in, or not opposed to, the best interests
of CRS and, with respect to any criminal third party proceeding (including any
action or investigation which could or does lead to a criminal third party
proceeding) had no reasonable cause to believe such conduct was unlawful. CRS
shall also indemnify any person who was or is an authorized representative of
CRS and who was or is a party or is threatened to be made a party to any
corporate proceeding by reason of the fact that such person was or is an
authorized representative of CRS, against expenses actually and reasonably
incurred by such person in connection with the defense or settlement of such
corporate action if such person acted in good faith and in a manner reasonably
believed to be in, or not opposed to, the best interests of CRS, except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to CRS unless and only
to the extent that the court in which such corporate proceeding was pending
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such authorized representative is
fairly and reasonably entitled to indemnity for such expenses which any court
shall deem proper. Such indemnification is mandatory under CRS's by-laws as to
expenses actually and reasonably incurred to the extent that an authorized
representative of CRS has been successful on the merits or otherwise in defense
of any third party or corporate proceeding or in defense of any claim, issue or
matter therein. The determination of whether an individual is entitled to
indemnification may be made by a majority of disinterested directors,
independent legal counsel in a written legal opinion or the shareholders. CRS
currently does not maintain a directors and officers liability insurance policy.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling CRS
pursuant to the foregoing provisions, CRS has been informed that in the opinion
of the Securities and Exchange Commission such indemnification is against public
policy as expressed in that Act and is therefore unenforceable.
Item 25. Other Expenses of Issuance and Distribution.
The estimated expenses of the distribution, all of which are to be
borne by us, are as follows. All amounts are estimates except the Securities and
Exchange Commission registration fee:
Registration Fee.............................. $ 230
Printing and Engraving Expenses............... $ 5,000
Accounting Fees and Expenses.................. $ 25,000
Legal Fees and Expenses....................... $ 60,000
Transfer Agent's Fees and Expenses............ $ 1,500
Miscellaneous................................. $ 8,270
Total........................ $ 100,000
II-1
Item 26. Recent Sale of Unregistered Securities.
Set forth below is information regarding the issuance and sales of CRS'
common stock without registration during the last three (3) years. No such sales
involved the use of an underwriter.
1. On November 1, 1999, we were incorporated pursuant to the New York Business
Corporation Law. Upon our incorporation 5,000,000 shares were issued to our
founding shareholder for consideration of $500 and 200,000 shares were
issued to his wife for consideration of $20. This transaction by us did not
involve any public offering and was exempt from the registration
requirements under the Securities Act pursuant to Section 4(2) thereof.
2. In June 2002 we issued 250,000 shares of common stock to Eli Weinstein, an
accredited investor, for consideration of $250,000. In October 2002 we
issued 250,000 shares of common stock to Mr. Weinstein for $250,000. We were
introduced to Mr. Weinstein by Five Flags, Inc. and as a result of Mr.
Weinstein's investment in our Company, we agreed to pay a finder's fee to
Five Flags, Inc. of $100,000. Five Flags, Inc., a consultant to CRS, is not
a registered broker-dealer. These issuances of shares of common stock to Mr.
Weinstein by us did not involve any public offering and was exempt from the
registration requirements under the Securities Act pursuant to Section 4(2)
thereof.
3. In November 2002 we issued 10,000 shares of common stock to David Kagel as
consideration for services rendered. Mr. Kagel assisted us in the
preparation of the June 1, 2002 private placement memorandum. We valued his
services at $10,000. Such offering was exempt from the registration
requirement under the Securities Act pursuant to Section 4(2) thereof. Mr.
Kagel is an accredited investor. This transaction did not involve any public
offering and was exempt from the registration requirements under the
Securities Act pursuant to Section 4(2) thereof.
4. In February of 2003 we issued 20,000 shares, valued at $20,000 to Benjamin
Lapin as part of a finder's fee arrangement we had with Mr. Lapin, a
non-accredited individual. Mr. Lapin introduced us to Dynamic Distribution
Corp. which resulted in an agreement with Dynamic but no realization of
revenue to date. Dynamic Distribution Corp. is not a registered
broker-dealer. Mr. Lapin, in addition to having access to the books and
records of CRS as well as ample access to our management, was considered
sophisticated enough pursuant to Registration D of the Securities Act to
understand the risks of an investment in our company. As he had such
knowledge and experience in financial and business matters that he was in a
position to evaluate such risks. This transaction did not involve any public
offering and was exempt from the registration requirements under the
Securities Act pursuant to Section 4(2) thereof.
ITEM 26. EXHIBITS
* Previously filed.
II-2
Item 27. Undertakings.
A. Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to our directors, officers and controlling persons
pursuant to the foregoing provisions, or otherwise, we have been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities, other than the payment by us of expenses incurred or paid by
our director, officer or controlling person 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, we will, unless in
the opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
B. We hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To specify in the prospectus any facts or events arising
after the effective date of the Registration Statement or
most recent post-effective amendment thereof which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered, if the total
dollar value of securities offered would not exceed that
which was registered, and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Securities and Exchange Commission pursuant to Rule 424(b),
Section 230.424(b) of Regulation S-B, if, in the aggregate,
the changes in volume and price represent no more than a
20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective Registration Statement; and
(iii) To include any additional or changed material information
with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material
change to such information in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
II-3
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, as
amended, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form SB-2 and has duly caused
this amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the city of New York, State of New
York, on October 10, 2003.
CORPORATE ROAD SHOW.COM INC.
New York, New York
October 10, 2003
By: /s/ Frank Ferraro
--------------------------------
Frank Ferraro
Chairman, Principal Financial Officer,
Chief Accounting Officer and Chief Executive
Officer
II-4