AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 24, 2003
REGISTRATION STATEMENT NO. 333-104815
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 2 TO
FORM SB-2/A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CORPORATE ROAD SHOW.COM INC.
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
NEW YORK 7812
------------------------------- -----------------------------
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER)
11-3516358
---------------------------------------
(I.R.S. EMPLOYER IDENTIFICATION NUMBER)
(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
-------------------------------
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
-------------------------------
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
===================================== =================== ============================ ========================= ===================
Proposed Maximum Offering Proposed Maximum Amount of
Title of Each Class of Securities to Amount to be Price Per Security Aggregate Offering Registration Fee
be Registered Registered Price(1)
$184
Common Stock, $0.0001 par
value, to be registered by Issuer 2,000,000 $1.00 $2,000,000
Common Stock, $0.0001 par value, to be
registered by Selling Shareholder 500,000 $1.00 $ 500,000 $46
===================================== =================== ============================ ========================= ===================
(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.
(ii)
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 JUNE 24, 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. 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. Although we are not currently quoted or listed on any market, we
anticipate a listing on the OTC Bulletin Board concurrent with the effectiveness
of this prospectus. 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.
We will bear all the costs and expenses associated with the
preparation and filing of this registration statement.
--------------------------
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.
--------------------------
PRICE PER SHARE AGGREGATE PRICE PROCEEDS TO US
Common Stock Offered by the $1.00 $2,000,000.00 $1,900,000.00
Registrant
Common Stock Offered by the $1.00 $500,000.00 0
Selling Shareholder
(iii)
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.
The information is not complete and may be changed. We may not sell
these securities until the registration statement filed with the Securities and
Exchange Commission is effective. This prospectus is not an offer to sell these
securities and it is not soliciting an offer to buy these securities in any
state where the offer or sale is not permitted.
-------------------------
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 [June 24, 2003]
(iv)
TABLE OF CONTENTS
Prospectus Summary...........................................................1
The Offering.................................................................2
Summary Financial Data.......................................................3
Risk Factors.................................................................4
Use of Proceeds..............................................................8
Determination of Offering Price..............................................9
Dilution.....................................................................9
Capitalization..............................................................10
Dividend Policy.............................................................11
Management's Discussion and Analysis and Results of Operations..............11
Description of Business.....................................................14
Management..................................................................17
Code of Ethics..............................................................20
Certain Relationships and Related Transactions..............................20
Disclosure of Commission Position of Indemnification
for Securities Act Liabilities..............................................21
Security Ownership of Certain Beneficial Owners and Management..............22
Selling Shareholder.........................................................23
Description of Securities...................................................23
Plan of Distribution........................................................25
Legal Matters...............................................................26
Experts.....................................................................27
Where You Can Find More Information.........................................27
Financial Statements.......................................................F-1
(v)
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 operation which
produces corporate videos available on both the worldwide web via our website
www.corporateroadshow.com or in a hardcopy format. Our website serves as a
portal for companies to showcase their products and market their goods and
services to the business and financial communities. 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.
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.
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 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.
-1-
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: Fourth Quarter of 2003. 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.
EMPLOYEES
As of June 13, 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
-2-
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.
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.
STATEMENT OF OPERATIONS DATA
(Dollar amounts and share data)
Three Months Ended Year Ended
MARCH 31, DECEMBER 31
-------------------------- --------------------------
2003 2002 2002 2001
----------- ----------- ------------ -----------
Revenues $ 17,245 $ 13,556 $ 25,189 $ 10,575
Net Income (Loss) $ (85,801) $ 2,379 $ (162,951) $ (28,031)
Income (Loss) Per
Common Share $ (.01) $ - $ (.03) $ (.01)
Weighted Average Number of
Common Shares Outstanding 5,723,333 5,200,000 5,336,989 5,200,000
BALANCE SHEET DATA
March 31, 2003 December 31, 2002
-------------- -----------------
Working Capital $ 127,889 $ 224,110
Total Assets $ 189,477 $ 293,917
Total Liabilities $ 7,985 $ 10,424
Stockholders' Equity $ 181,492 $ 283,493
See Financial Statements
-3-
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.
CONCENTRATED OWNERSHIP OF OUR COMMON STOCK MAY ALLOW CERTAIN SECURITY HOLDERS TO
EXERT SIGNIFICANT INFLUENCE IN CORPORATE MATTERS.
If we sell all of the 2,000,000 shares being offered by us, Mr.
Ferraro, our Chairman and President, will own approximately 67% of our
outstanding shares of common stock. Such concentrated control allows Mr. Ferraro
to exert significant influence in matters requiring approval of our
stockholders. As Mr. Ferraro holds a majority of the outstanding common stock,
he is in a position to influence significantly the election of some or all of
the members of our Board of Directors and the outcome of all corporate actions
requiring stockholder approval.
THE TIMING AND AMOUNT OF CAPITAL REQUIREMENTS ARE NOT ENTIRELY WITHIN OUR
CONTROL AND CANNOT ACCURATELY BE PREDICTED.
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
MARCH 31, 2003 HAD AN ACCUMULATED DEFICIT OF $291,420.
Stockholders' equity and working capital was $181,492 and $127,889,
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.
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.
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.
-4-
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 ($291,420). 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.
OUR LACK OF CONSISTENCY IN OUR OPERATING RESULTS MAKES IT DIFFICULT FOR US TO
ACCURATELY PREDICT FUTURE GROWTH.
Our operating results have been inconsistent and may continue to
fluctuate from quarter to quarter and will depend on numerous factors,
including, but not limited to, customer demand and market acceptance of our
products and services. To some extent our business is sensitive to the
performance of the capital markets. If the public's interest in investing does
not continue to grow, there will be a reduced marketplace for our customers to
target and the demand for our products and services may wane.
WE ONLY HAVE TWO EMPLOYEES AND AS A RESULT WE ARE DEPENDENT ON THEIR SERVICES.
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 either
employee, there can be no assurances that we would be able to retain qualified
executive staff. Further, we do not maintain any key man life insurance policies
on either Mr. Ferraro or Mr. Epifanio any of our employees. Therefore, the loss
of the service of either of our employees could have a material adverse effect
upon us.
WE MAY NOT BE ABLE TO ADEQUATELY PROTECT OUR INTELLECTUAL PROPERTY RIGHTS.
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.
-5-
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.
WE MAY NOT BE ABLE TO ADEQUATELY PROTECT OURSELVES AGAINST SECURITY RISKS.
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
service or information. 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 could adversely
affect our business.
THE SELLING SHAREHOLDER MAY COMPETE WITH US IN SELLING COMMON STOCK.
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. 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.
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.
OUR SUCCESS DEPENDS, IN PART, ON OUR CLIENTS' SUCCESS.
Although we do not and will not pass upon the legitimacy of our
clients, our success will depend partially on our ability to present to the
public, companies with significant growth prospects. Failure to build and
maintain a reputation for such, may reduce our service value to potential
clients, which may harm our business.
BEFORE THIS OFFERING, THERE HAS BEEN NO PUBLIC MARKET FOR OUR COMMON STOCK.
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.
-6-
PURCHASERS OF THE SHARES OFFERED HEREBY WILL INCUR IMMEDIATE SUBSTANTIAL
DILUTION IN THE NET TANGIBLE BOOK VALUE OF APPROXIMATELY $.73 OR 73% 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 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 securities we have received have been restricted. Thus, there is usually a
significant period of time 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.
TERRORIST ATTACKS MAY NEGATIVELY AFFECT OUR OPERATIONS AND YOUR INVESTMENT IN
OUR COMMON SHARES.
We cannot assure you that there will not be further terrorist attacks
against the United States or United States businesses. These attacks or armed
conflicts may directly impact our business and the financial markets as a whole.
We do not maintain any terrorism insurance. The consequences of any armed
conflict are unpredictable, and we may not be able to foresee events that could
have an adverse effect on our business or your investment. More generally, any
of these events could result in increased volatility in or damage to the United
States and worldwide financial markets and economy. They also could result in a
continuation of the current economic uncertainty in the United States or abroad.
THE PENNY STOCK RULES MAY HAVE A RESTRICTIVE EFFECT ON THE TRADING OF OUR COMMON
STOCK.
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.
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
-7-
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.
-8-
USE OF PROCEEDS
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, through
broker/dealers or in private transactions. The following table discloses the net
proceeds we would realize from the sale of the related numbers of shares.
PERCENTAGE OF OFFERING SOLD
CLASSIFICATION OF USE 100% 75% 50% 25%
Sales and Marketing $300,000 $224,000 $150,000 $64,000
Plant and Equipment 150,000 112,000 75,000 32,000
Television Show (with airtime)
500,000 364,000 250,000 104,000
Web Development 200,000 154,000 100,000 44,000
Legal and Accounting 150,000 112,000 75,000 32,000
General and Administrative 150,000 112,000 75,000 32,000
Working Capital 450,000 322,000 175,000 92,000
-------------------- ---------------- -------------- -------------
TOTAL $1,900,000 $1,400,000 $900,000 $400,000
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. However,
management will retain sole discretion as to the use of the proceeds and (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. 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. Although the net proceeds from the
sale of less than 25% of the securities offered hereby would still be used for
working capital purposes if we fail to sell more than that amount, we will need
additional capital to maintain our working capital needs for the next twelve
(12) months.
-9-
DETERMINATION OF OFFERING PRICE
The offering price has no relationship to any established criteria of
value, such a book value or earning 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 March 31, 2003, was
$156,492, or approximately $.03 per share. Thus, as of March 31, 2003, the net
tangible book value per share of common stock owned by our current stockholders
would have increased by $1,925,000 or $.24 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 $.73 per share from the
offering price. The following table illustrates this per share dilution and
reflects the receipt of varying amounts of proceeds:
100% 75% 50% 25%
Public offering price per share of common
stock offered hereby $1.00 $1.00 $1.00 $1.00
----- ----- ----- -----
Net tangible book value per share before
offering 0.03 0.03 0.03 0.03
Increase per share attributable to new
investors 0.24 0.19 0.13 0.06
----- ----- ----- -----
Adjusted net tangible book value per share
after this offering $0.27 $0.22 $0.16 $0.09
----- ----- ----- -----
Dilution to new investors $0.73 $0.78 $0.84 $0.91
===== ===== ===== =====
-10-
The following tables summarize the relative investments of investors
pursuant to this offering and the current shareholders of CRS:
ASSUMING 100% OF OFFERING (2,000,000 SHARES) SOLD
Current Public Investors
Stockholders Total
------------------ ------------------ -------------------
Number of shares of common stock purchased 5,730,000 2,000,000 7,730,000
Percentage of outstanding common stock after offering
74% 26% 100%
Gross consideration paid $500,520 $2,000,000 $2,500,520
Percentage of consideration paid 20% 80% 100%
Average consideration paid $ .09 $1.00 $ .32
ASSUMING 75% OF OFFERING (1,500,000 SHARES) SOLD
Current Public Investors
Stockholders Total
------------------ ------------------ -------------------
Number of shares of common stock purchased 5,730,000 1,500,000 7,230,000
Percentage of outstanding common stock after offering
79% 21% 100%
Gross consideration paid $500,520 $1,500,000 $2,000,520
Percentage of consideration paid 25% 75% 100%
Average consideration paid $ .09 $1.00 $ .28
ASSUMING 50% OF OFFERING (1,000,000 SHARES) SOLD
Current Public Investors
Stockholders Total
------------------ ------------------ ------------------
Number of shares of common stock purchased 5,730,000 1,000,000 6,730,000
Percentage of outstanding common stock after offering
85% 15% 100%
Gross consideration paid $500,520 $1,000,000 $1,500,520
Percentage of consideration paid 33% 67% 100%
Average consideration paid $ .09 $1.00 $ .22
ASSUMING 25% OF OFFERING (500,000 SHARES) SOLD
Current Public Investors
Stockholders Total
------------------ ------------------ -------------------
Number of shares of common stock purchased 5,730,000 500,000 6,230,000
Percentage of outstanding common stock after offering
92% 18% 100%
Gross consideration paid $500,520 $500,000 $1,000,520
Percentage of consideration paid 50% 50% 100%
Average consideration paid $ .09 $1.00 $ .16
-11-
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 March 31,
2003. This table should be read in conjunction with the financial statements and
related notes included elsewhere in this prospectus.
MARCH 31, 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) (291,420)
Accumulated other comprehensive
loss (13,108)
----------
Total Stockholders' Equity 181,492
----------
Total Capitalization $ 181,492
==========
-12-
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 a 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, which require management to
make estimates and assumptions that affect the reported amount 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:
CRS realizes revenues from net sales generated by 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 on CRS' marketing efforts and the
availability of its services becoming more known to the corporate world. The
production costs also increased accordingly.
Cost and expenses increased by $149,534 in 2002 when compared to 2001
and 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 in
connection with the raising of capital as well as CRS' trying to go public and
(iv) an increase of $19,216 in other expenses including insurance and other
office expenses.
-13-
As a result of the above, 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.
THREE MONTHS ENDED MARCH 31, 2003 AND 2002:
Revenues increased by $3,689 (27%) from $13,556 to $17,245 when
comparing the three month periods ended March 31, 2003 to 2002. This increase is
a result of CRS' marketing efforts.
Operating expenses increased by $91,869 when comparing the three
months ended March 31, 2003 to the comparative period in 2002. Payroll accounted
for $25,260 of this increase as a result of new hires. $51,719 of the increase
is attributable to consulting fees incurred in 2003 and the production of a
marketing brochure in 2003, none of which costs were experienced during the
comparable period in 2002.
As a result of the above, net loss for the three months ended March
31, 2003 was $85,801 or $0.01 per share, compared to net income of $2,379 or
$0.00 for the similar period in 2002.
LIQUIDITY AND CAPITAL RESOURCES:
As of March 31, 2003, working capital amounted to $127,889 compared
to $224,110 at December 31, 2002. CRS' current ratio at March 31, 2003 and
December 31, 2002 was 17.0:1 and 22.5:1, respectively.
During 2002, CRS utilized $133,557 for operations primarily as a
result of its net loss of $162,951. For the 2001 year CRS generated $2,207 in
cash from operations. During 2002, CRS used $10,358 for investing activities,
primarily for the acquisition of office, including computer, equipment, with no
comparable amount used in 2001. During 2002, CRS sold its common shares in a
private placement and realized net proceeds of $377,500. As a result of this,
CRS ended 2002 with cash of $234,044.
For the three month period ended March 31, 2003, CRS utilized $82,898
for operations, primarily as a result of its net loss of $85,901, compared to
$12,545 in cash generated from operations for the similar period in the previous
year. Cash utilized for investing activities for the 2003 period aggregated
$6,339 and was used for the purchase of office furniture. During 2003, CRS
continued to incur costs ($10,000) associated with the proposed public offering
of its common shares. As a result, CRS' cash balance at March 31, 2003 was
$134,612.
CRS has a limited operating history. Some of its clients to date are
also in the early stages of their operations with not much available cash on
hand. As a result, CRS occasionally receives restricted equity securities issued
by its clients. The value of these securities fluctuate and are not readily
convertible to cash and are recorded at a significant discount. CRS is currently
operating with insufficient working capital, which, among other things has
constrained its ability to market its services. As a result, management is
dependent on the proceeds of the proposed public offering of CRS' securities to
maintain and increase the level of its operations. There can, however, be no
assurance of this.
IMPACT OF INFLATION
Inflationary factors have not had a significant effect on our
operations.
CRS is not aware of any material trend, event or capital commitment,
which would potentially adversely affect liquidity. In the event such a trend
develops, CRS believes that it will have sufficient funds available to satisfy
working capital needs through the funds expected from equity sales.
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
-14-
CRS' products, the competitive environment within the automotive aftermarket
industry, the ability of CRS to continue to expand its operations, the level of
costs incurred in connection with CRS' expansion efforts, economic conditions
and the financial strength of CRS' customers and suppliers. Investors are
directed to consider other risks and uncertainties discussed in documents filed
by CRS with the Securities and Exchange Commission.
-15-
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.
CRS is a business to business service firm. Our basic service is to
host and digitize corporate videos already produced by our clients. The next
service is to actually videotape and produce a corporate presentation for
dissemination on our website. The fee's 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 audiences for these productions are aimed at the investment
community at large. CRS broadcasts in over 35 countries, however we measure
success by the amount of video views or "hits" a clients video receives. The
goal for clients is to get the message across to either their shareholders,
customers or employees or visitors to the CRS website. The content changes
amongst companies. For example, Polymer Research and Genesis Bioventures used an
interview format. CRS interviews CRS and disseminates 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 and Genesis Bioventures. All of the aforementioned productions
were disseminated on the CRS website.
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.
SHOW CONCEPT
Our plan of operations for CRS' expansion into the Show Concept
starts with identification of the client. Once the client has been identified we
anticipate subcontracting the production and obtaining the airtime. We plan to
initially subcontract our production needs to available production studios.
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, the timeframe necessary
to obtain clients varies from company to company; we anticipate that it will
take about 30 days. The timeframe for the production will vary depending on the
client's needs, however, we anticipate a 30 day turnaround from 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 we
anticipate an initial production cost for our first show 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.
-16-
We plan to distribute the productions 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 videotape 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. 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 principle 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.
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.
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.
We presently 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. We will continue to monitor that "securities component" level
of very carefully to ensure that we never fall under that classification. All of
the securities we have received as partial payment for our services are
restricted. 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.
MARKETING APPROACH
Our current marketing plan includes "key word" marketing on major
Internet search engines like Lycos, Alta Vista, MSN and Yahoo! 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.
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.
-17-
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 competitors (such as The Street.Com,
MarketWatch.Com, and the Motley Fool) could quickly build in such services and
become direct competitors to CRS. Our continuing effort to offer the highest
quality product at the most reasonable prices should allow us to compete with
any existing or potential competitors.
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.
EMPLOYEES
Currently, we have 2 employees. None 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.
SEASONALITY
We have not found our business to be seasonal in nature.
LEGAL PROCEEDINGS
We are not a party to any pending legal proceeding nor are any legal
actions contemplated by us at this time.
-18-
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 December 31, 2002,
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.
-19-
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 December 31, 2002.
SUMMARY COMPENSATION TABLE
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
SECURITIES
UNDERLYING ALL OTHER
Name and Principal Position YEAR SALARY BONUS OPTIONS (#) COMPENSATION
---------------------------------------------------------------------------
Frank Ferraro 2003 $ 90,000
Chairman, President and Chief 2002 $ 45,000
Executive Officer 2001 0
Vincent Epifanio 2003 $ 45,000(1)
Vice President of Sales and Marketing
------------------------------------------------------------------------------------------------------------------------------------
(1) Based on a salary of $1,250 per week. However, as of July 1, 2003, Mr.
Epifanio will be compensated purely on a commission basis.
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.
-20-
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.
-21-
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.
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 December 31, 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.
-22-
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.
-23-
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of June 13, 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 June 13, 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.
PERCENTAGE OF SHARES
BENEFICIALLY OWNED AFTER THE OFFERING
NUMBER OF SHARES BEFORE ASSUMING ALL
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIALLY OWNED THE OFFERING SHARES ARE SOLD
------------------------------------- ------------------ --------------------- -------------------
Frank Ferraro 5,000,000 91% 64%
80 Orville Drive, Suite 100
Bohemia, NY 11716
Vincent Epifanio 0 0% 0%
80 Orville Drive, Suite 100
Bohemia, NY 11716
All Officer and Directors as a group 5,000,000 91% 64%
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
June 13, 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 June 13, 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."
-24-
PERCENTAGE OF SHARES
BENEFICIALLY OWNED AFTER THE OFFERING
NUMBER OF SHARES BEFORE ASSUMING ALL
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIALLY OWNED THE OFFERING SHARES ARE SOLD
------------------------------------ ------------------ -------------------- ------------------
Frank Ferraro 5,000,000 91% 64.0%
80 Orville Drive, Suite 100
Bohemia, NY 11716
Eli Weinstein 500,000 9% 6%
596 Setun Circle
Lakewood, New Jersey 08701
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
June 13, 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 June 13, 2003 we have five shareholders.
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.
-25-
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.
-26-
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.
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 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.
-27-
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.
LEGAL MATTERS
The validity of the shares has been passed upon for us by our
counsel, Spitzer & Feldman P.C.
-28-
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.
-29-
CORPORATE ROAD SHOW.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
INDEX
PAGE(S)
Independent Auditors' Report F - 2.
Financial Statements:
Balance Sheets as of March 31, 2003 (Unaudited) and December 31, 2002 F - 3.
Statements of Operations for the Cumulative Period from Inception, November 1, 1999 to
March 31, 2003 (Unaudited), the three months ended March 31, 2003 and 2002
(Unaudited)
and the Years Ended December 31, 2002 and 2001 F - 4.
Statement of Shareholders' Equity for the Cumulative Period from Inception,
November 1, 1999 to December 31, 2002 and the Unaudited Period from January
1, 2003
to March 31, 2003 F - 5.
Statements of Cash Flows for the Cumulative Period from Inception, November
1, 1999 to March 31, 2003 (Unaudited), the three months ended March 31,
2003 and 2002 (Unaudited) and
the Years Ended December 31, 2002 and 2001 F - 6.
Notes to Financial Statements F - 7.
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.
/s/ LAZAR LEVINE & FELIX LLP
----------------------------
LAZAR LEVINE & FELIX LLP
New York, New York
January 29, 2003
F - 2
CORPORATE ROAD SHOW.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
- ASSETS - MARCH 31,
2003 DECEMBER 31,
(UNAUDITED) 2002
CURRENT ASSETS: ------------ -----------
Cash $ 134,612 $ 234,044
Prepaid expenses 1,262 490
CURRENT ASSETS: ------------ -----------
TOTAL CURRENT ASSETS 135,874 234,534
CURRENT ASSETS: ------------ -----------
EQUIPMENT, AT COST LESS ACCUMULATED DEPRECIATION OF
$1,364 AND $700 FOR 2003 AND 2002, RESPECTIVELY 13,533 7,858
CURRENT ASSETS: ------------ -----------
OTHER ASSETS:
Deferred offering costs 25,000 15,000
Other assets 1,800 1,800
Investments - long-term 13,270 34,725
------------ -----------
40,070 51,525
------------ -----------
$ 189,477 $ 293,917
============ ===========
- LIABILITIES AND SHAREHOLDERS' EQUITY -
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ 4,563 $ 6,580
Payroll taxes withheld 3,422 3,649
Due to officer - 195
------------ -----------
TOTAL CURRENT LIABILITIES 7,985 10,424
------------ -----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Common stock, $.0001 par value; 20,000,000 shares authorized,
5,730,000 and 5,710,000 shares issued
and outstanding in 2003 and 2002, respectively 573 571
Additional paid-in capital 485,447 465,449
Deficit accumulated during the development stage (291,420) (205,619)
Accumulated other comprehensive income (loss) (13,108) 23,092
------------ -----------
181,492 283,493
------------ -----------
$ 189,477 $ 293,917
============ ===========
See accompanying notes.
F - 3
--------------------------------------------------------------------------------
CORPORATE ROAD SHOW.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
CUMULATIVE DURING THE
DEVELOPMENT STAGE
(NOVEMBER 1, 1999
TO MARCH 31, THREE MONTHS ENDED MARCH 31,
2003) 2003 2002 YEAR ENDED DECEMBER 31,
(Unaudited) (Unaudited) (Unaudited) 2002 2001
--------------------- ------------------------------- -------------------------------
REVENUES $ 53,009 $ 17,245 $ 13,556 $ 25,189 $ 10,575
COSTS AND EXPENSES:
Production costs 11,050 600 500 6,900 3,550
Computer expenses 3,268 451 -- 569 1,228
Compensation expense 143,760 35,760 10,500 66,000 30,000
Advertising and promotion 36,732 21,284 -- 14,400 1,048
Professional fees 109,713 30,435 -- 78,450 175
Other expenses 39,906 14,516 177 21,821 2,605
----------- ----------- ----------- ----------- -----------
344,429 103,046 11,177 188,140 38,606
----------- ----------- ----------- ----------- -----------
NET INCOME (LOSS) $ (291,420) $ (85,801) $ 2,379 $ (162,951) $ (28,031)
=========== =========== =========== =========== ===========
INCOME (LOSS) PER SHARE:
Basic and diluted $ (.06) $ (.01) $ -- $ (.03) $ (.01)
=========== =========== =========== =========== ===========
Weighted average number of
common shares outstanding 5,278,171 5,723,333 5,200,000 5,336,989 5,200,000
=========== =========== =========== =========== ===========
See accompanying notes.
F - 4
-------------------------------------------------------------------------------
CORPORATE ROAD SHOW.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF SHAREHOLDERS' EQUITY
DEFICIT
ACCUMULATED ACCUMULATED
ADDITIONAL DURING THE OTHER
COMMON STOCK PAID-IN DEVELOPMENT COMPREHENSIVE SHAREHOLDERS'
NUMBER AMOUNT CAPITAL STAGE INCOME EQUITY
---------- --------- ---------- ------------ ------------- -------------
At inception,
November 1, 1999 -- $ -- $ -- $ -- $ -- $ --
Issuance of common units 5,200,000 520 -- -- -- 520
Net loss for period ended
December 31, 1999 -- -- -- (623) -- (623)
---------- ---------- ---------- ---------- ---------- ----------
BALANCE AT DECEMBER 31, 1999 5,200,000 520 -- (623) -- (103)
Officers' compensation -- -- 12,000 -- -- 12,000
Net loss for year ended
December 31, 2000 -- -- -- (14,014) -- (14,014)
---------- ---------- ---------- ---------- ---------- ----------
BALANCE AT DECEMBER 31, 2000 5,200,000 520 12,000 (14,637) -- (2,117)
Officers' compensation -- -- 30,000 -- -- 30,000
Net loss for year ended
December 31, 2001 -- -- -- (28,031) -- (28,031)
---------- ---------- ---------- ---------- ---------- ----------
BALANCE AT DECEMBER 31, 2001 5,200,000 520 42,000 (42,668) -- (148)
Officers' compensation -- -- 21,000 -- -- 21,000
Compensatory shares 10,000 1 9,999 -- -- 10,000
Unrealized gain on
equity securities -- -- -- -- 23,092 23,092
Sale of common shares 500,000 50 392,450 -- -- 392,500
Net loss for year ended
December 31, 2002 -- -- -- (162,951) -- (162,951)
---------- ---------- ---------- ---------- ---------- ----------
BALANCE AT DECEMBER 31, 2002 5,710,000 571 465,449 (205,619) 23,092 283,493
Compensatory shares 20,000 2 19,998 -- -- 20,000
Unrealized loss on
equity securities -- -- -- -- (36,200) (36,200)
Net loss for three months
ended March 31, 2003
(Unaudited) -- -- -- (85,801) -- (85,801)
---------- ---------- ---------- ---------- ---------- ----------
BALANCE AT MARCH 31,
2003 (Unaudited) 5,730,000 $ 573 $ 485,447 $(291,420) $ (13,108) $ 181,492
========== ========== ========== ========== ========== ==========
See accompanying notes.
F - 5
-------------------------------------------------------------------------------
CORPORATE ROAD SHOW.COM, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
CUMULATIVE DURING
THE DEVELOPMENT
STAGE
(NOVEMBER 1, 1999 YEAR ENDED
TO MARCH 31, THREE MONTHS ENDED MARCH 31, ----------------------------
2003) 2003 2002 DECEMBER 31,
(UNAUDITED) (UNAUDITED) (UNAUDITED) 2002 2001
-----------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS:
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net (income) loss $ (291,420) $ (85,801) $ 2,379 $ (162,951) $ (28,031)
Adjustments to reconcile net
income (loss) to net cash provided
(used) by operating activities:
Depreciation 1,364 664 - 700 -
Officer's compensation 63,000 - 10,500 21,000 30,000
Compensatory shares 30,000 20,000 - 10,000 -
Changes in assets and liabilities:
Prepaid expenses (1,262) (772) - (490) -
Investments held for sale (26,378) (14,745) - (11,633) -
Accrued expenses 4,563 (2,017) (334) 6,168 238
Payroll taxes payable 3,422 (227) - 3,649 -
---------- ---------- ---------- ---------- ----------
Net cash provided (used)
by operating activities (216,711) (82,898) 12,545 (133,557) 2,207
---------- ---------- ---------- ---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of equipment (14,897) (6,339) - (8,558) -
Security deposits (1,800) - - (1,800) -
---------- ---------- ---------- ---------- ----------
Net cash (used) by
investing activities (16,697) (6,339) - (10,358) -
---------- ---------- ---------- ---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net repayment of officer's loans - (195) - - (2,073)
Offering costs (25,000) (10,000) - (15,000) -
Sale of equity units 393,020 - - 392,500 -
---------- ---------- ---------- ---------- ----------
Net cash provided (used) by
financing activities 368,020 (10,195) - 377,500 (2,073)
---------- ---------- ---------- ---------- ----------
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS 134,612 (99,432) 12,545 233,585 134
Cash and cash equivalents - beginning
of period - 234,044 459 459 325
---------- ---------- ---------- ---------- ----------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 134,612 $ 134,612 $ 13,004 $ 234,044 $ 459
========== ========== ========== =========== ===========
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 THREE MONTHS ENDED MARCH 31, 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
$291,420 through March 31, 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.
F - 7
(D) FIXED ASSETS:
Fixed assets are recorded at cost. Depreciation and amortization are
provided on a straight-line basis over 5 years.
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 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, 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.
(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) STATEMENT OF COMPREHENSIVE INCOME:
Other comprehensive income items under SFAS 130 are transactions
recorded in shareholders' equity during the year, excluding net income
and transactions with shareholders.
Investments in debt and equity securities are classified as
available-for-sale, held-to-maturity or as part of a trading portfolio.
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).
F - 8
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:
MARCH 31, 2003 DECEMBER 31,
(UNAUDITED) 2002
-------------- -------------
Deferred tax assets and liabilities
consist of the following:
DEFERRED TAX ASSETS:
Net operating loss carry forwards $ 67,668 $ 47,745
Less valuation allowance (67,668) (47,745)
----------- ------------
$ - $ -
=========== ============
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 and 2001 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. The Company has
provided a 100% valuation allowance on the deferred tax assets at
December 31, 2002 and 2001 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 paid
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 to Benjamin Lapin as part of a
finder's fee arrangement we had with Mr. Lapin, a non-accredited. Mr. Lapin
introduced us to Dynamic Distribution Corp. which resulted in an agreement
with Dynamic but no realization of revenue to date. 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 to understand the risks
of an investment in our company. 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
EXHIBIT NO. DESCRIPTION
3.1 Certificate of Incorporation of the Registrant
3.2 By-laws of the Registrant
4.1 Specimen Common Stock Certificate
5.1 Opinion of Spitzer & Feldman P.C. with respect to
the validity of the shares
10.1 American Express Agreement
10.2 HQ Lease
10.3 2003 Omnibus Stock Option Agreement, dated
February 14, 2003*
10.5 Form of Subscription Agreement*
10.6 Ferraro Employment Agreement
10.7 Overture Services, Inc. Agreement
10.8 Dynamic Distribution Corp. Agreement, dated
February 11, 2003
23.1 Consent of Lazar, Levine & Felix LLP
23.2 Consent of Spitzer & Feldman P.C. (included in Exhibit 5.1)
* To be filed by amendment.
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 June 23, 2003.
CORPORATE ROAD SHOW.COM INC.
New York, New York
June 23, 2003
By: /s/ Frank Ferraro
-------------------------------------
Frank Ferraro
Chairman, Principal Financial Officer
and Chief Executive Officer
II - 4