As filed with the Securities and Exchange Commission on February 16, 2001
Registration No. 333-32816
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Post Effective Amendment No. 1 to Form S-1
on Form S-3
REGISTRATION STATEMENT Under THE SECURITIES ACT OF 1933
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AUTHORISZOR INC.
(Exact name of registrant as specified in its charter)
Delaware 7372 75-2661571
(State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
Authoriszor Inc.
One Van de Graaff Drive
Suite 502
Burlington, Massachusetts 01803-5188
(781) 359-9650
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Mr. Paul Ayres
Chief Executive Officer and President
Authoriszor Inc.
One Van de Graaff Drive
Suite 502
Burlington, Massachusetts 01803-5188
(781) 359-9650
(Name, address and telephone number of agent for service)
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Copies to:
Mark D. Wigder, Esq. Brian M. McCall, Esq.
Jenkens & Gilchrist, Dechert Price & Rhoads
a Professional Corporation 2 Serjeant's Inn
1445 Ross Avenue, Suite 3200 London EC4Y 1LT
Dallas, Texas 75202 England
(214) 855-4500 011 44 207 583 5353
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration
Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
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If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box.
[X]
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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. [ ]
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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. [ ]
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If delivery of the Prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
PROSPECTUS
Subject to Completion, dated February 16, 2001
2,271,933 SHARES
AUTHORISZOR INC. LOGO
COMMON STOCK
The selling stockholders identified in this prospectus are selling
2,271,933 shares of common stock. We are not selling any shares of our common
stock under this prospectus and we will not receive any of the proceeds from the
shares of common stock sold by the selling stockholders.
Our common stock is listed on The Nasdaq Stock Market's National Market
under the symbol "AUTH." On February 14, 2001, the last reported sale price for
our common stock was $1.50 per share.
The selling stockholders may sell the shares of common stock described
in this prospectus in a number of different ways and at varying prices. We
provide more information about how the selling stockholders may sell their
shares in the section entitled "Plan of Distribution; Selling Stockholders" on
page 11.
INVESTING IN OUR COMMON STOCK INVOLVES RISKS. SEE "RISK FACTORS" ON
PAGE 3.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The information in this Prospectus is not complete and may be changed.
We are not using this attached Prospectus to offer to sell these securities or
to solicit offers to buy these securities in any place where the offer or sale
is not permitted.
THE DATE OF THIS PROSPECTUS IS FEBRUARY 16, 2001.
TABLE OF CONTENTS
PAGE
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Prospectus Summary.....................................................................................................1
Risk Factors...........................................................................................................3
Special Note Regarding Forward-Looking Statements......................................................................9
Use Of Proceeds.......................................................................................................10
Plan Of Distribution; Selling Stockholders............................................................................11
Legal Matters.........................................................................................................14
Experts...............................................................................................................15
Where You Can Find More Information...................................................................................16
Incorporation By Reference............................................................................................17
Disclosure Of Commission Position On Indemnification For Securities Act Liabilities...................................18
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR
TO WHICH WE HAVE REFERRED YOU. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH
INFORMATION THAT IS DIFFERENT. THIS DOCUMENT MAY ONLY BE USED WHERE IT IS LEGAL
TO SELL THESE SECURITIES. THE INFORMATION IN THIS DOCUMENT MAY ONLY BE ACCURATE
ON THE DATE OF THIS DOCUMENT.
i
PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in, or
incorporated by reference into, this prospectus. This summary does not contain
all the information you should consider before buying shares in the offering.
You should read the entire prospectus carefully.
AUTHORISZOR INC.
We provide a patent-pending security solution which secures corporate
information while enabling businesses to provide secure access to their
corporate Website and applications and to conduct secure communications over
computer networks and the Internet. Our product suite and processes enable a
corporation to provide secure access to the information on its Web server to its
customers, suppliers, employees and public visitors from the Internet, according
to their pre-determined security profile.
We believe our solution to be innovatively different from other
security solutions available today. Our solution provides security by securing a
customer's Website, corporate information assets and contents offline, making
this information completely inaccessible, except through the customer's Web
server. This process eliminates any direct contact between the person requesting
information and the corporate information assets.
Each request for corporate information is submitted to the server.
Then, by using silent security verification not apparent to the user, the
Authoriszor product suite identifies, authenticates and, if authenticated,
authorizes the request to proceed. To be authenticated by a server which has our
product suite installed, the end user and the user's computer or terminal must
be validated. Our profile selector ensures that the person requesting
information is only provided with information to which such person is
authorized. Validated requests for information are handled by the protected
server, which creates pseudo uniform resource locators that disconnect the name
of the data source and the location of the data on the corporate Web server.
Our virtual publisher then creates a response in the form of a virtual
Web page and, after ensuring that no changes have occurred in the environment or
device of the person requesting information since the request was submitted,
which ensures that requestor transmissions have not been intercepted nor
impersonated, and that the requestor identity is still the original requestor
that commenced the session, sends the requestor the Web page of information
off-line, publishing it through a virtual page publishing system. Our product
suite then immediately destroys the virtual Web page response that was sent to
the person requesting information.
The benefit of our product suite is that it has been designed to
provide an added dimension of security to existing security products, such as:
o firewalls;
o virtual private networks;
o encryption;
o security tokens;
o smart cards; and
o biometrics.
We have five patent applications pending in the U.S. for our
Authoriszor product suite. We have attempted to extend any successful U.S.
applications into the UK and other countries pursuant to the processes and
procedures provided by the Paris Convention and are currently evaluating the
necessity of extending any such successful U.S. patents pursuant to the Patent
Cooperation treaties. We have copyrights on all aspects of the Authoriszor
product suite and are in the process of applying for UK trademarks in respect of
the key Authoriszor logos used for branding. We are also in the process of
implementing confidentiality procedures and contractual provisions to further
protect our proprietary rights. Additional protection for the software,
documentation and other written materials is afforded by trade secret and, in
the U.S. only, unfair competition laws. "AUTHORISZOR", SZ Logo, "A Logo" and
"SECURES THE WEB" are trademarks or registered trademarks of Authoriszor or its
subsidiaries in the United States and other countries.
In addition, the Company provides a range of consulting services which
enable organizations to assess their respective internet security infrastructure
needs in the light of an increasing internet security risk and to help
understand how the Company's software suite is designed to reduce the inherent
risks associated with internet. In the event that a customer decides to install
the Company's software technology, the consulting services group are able to
provide implementation and knowledge transfer engagements that helps to ensure
the successful installation and configuration of the software solution.
Our predecessor was incorporated as a Colorado corporation on January
20, 1989 under the name Starlight Acquisitions, Inc. On May 10, 1996, Starlight
Acquisitions, Inc. acquired Toucan Mining Plc (then named Toucan Mining Ltd.),
incorporated in the Isle of Man, the holding company of a mining group operating
in South America.
On July 29, 1996, Starlight Acquisitions, Inc. was reincorporated as a
Delaware corporation on under the name Toucan Gold Corporation. Effective July
15, 1999, Toucan Mining Plc sold its sole operating subsidiary to Minmet Plc, a
company listed on the Irish Stock Exchange and the London Stock Exchange, in
consideration for the issue of Minmet Plc ordinary shares, the grant of warrants
and other consideration. On July 22, 1999, we acquired all the issued share
capital of Authoriszor Limited, which was then named ITIS Technologies Limited,
whose business comprised the basis of our current business. On August 25, 1999,
our name was changed to Authoriszor Inc. and the name of our subsidiary was
changed to Authoriszor Ltd.
On January 12, 2000, Authoriszor Holdings Ltd., a newly created
wholly-owned subsidiary of Authoriszor Inc., acquired the whole of the issued
share capital of Authoriszor Ltd. as part of an intra-group re-organization.
On January 27, 2000, we sold our wholly-owned subsidiary, Toucan Mining
Plc, to Golden Ridge Group Limited for an aggregate consideration of $809,750
((pound)500,000) in cash. On the same date, Toucan Mining Plc agreed to transfer
to Authoriszor Inc. the beneficial interest in 2,000,000 shares in Minmet Plc
and warrants to subscribe for ordinary shares of Minmet Plc at a price of
(pound)0.08 per share for a further 7,700,000 shares in Minmet Plc for a
consideration of (pound)1.
Our principal offices are located at One Van de Graaff Drive, Suite
502, Burlington, Massachusetts 01803-5188, and our telephone number is (781)
359-9650. Our website is located at http://www.authoriszor.com. Information
contained on our website or links contained on our website is not a part of this
prospectus.
ASSUMPTIONS USED IN THIS PROSPECTUS
Unless the context otherwise requires, "Authoriszor," the "Company,"
"we," "our," "us" and similar expressions refers to Authoriszor Inc., its
subsidiaries and predecessors.
RISK FACTORS
You should consider carefully the following risks before making a
decision to buy our common stock. If any of the following risks actually occur,
our business, financial condition or results of operations would likely suffer.
In such case, the trading price of our common stock could decline, and you may
lose all or part of the money you paid to buy our common stock. The risk factors
below do not necessarily appear in order of importance. The risks and
uncertainties described below are not the only ones we face. Additional risks
and uncertainties not presently known to us may also impair our business
operations. We have a history of losses and negative cash flow and anticipate
continued losses. Since our formation, we have incurred operating losses and
negative cash flow. As of December 31, 2000, we had an accumulated deficit of
approximately $15,839,523. We also have experienced net losses during our entire
history prior to entering the Internet security business. We anticipate that our
business will generate operating losses for the foreseeable future until we are
successful in generating significant additional revenues to support our level of
operating expenses. We cannot assure you that we will ever achieve or sustain
profitability or that our operating losses will not increase in the future. If
we do achieve profitability, we cannot be certain that we can sustain or
increase profitability on a quarterly or annual basis in the future. To the
extent we are unable to achieve profitability in the future, our business,
prospects, financial conditions and results of operations will suffer.
RISKS RELATED TO OUR BUSINESS
We expect our quarterly operating results to fluctuate.
We anticipate that our quarterly operating results will vary according
to several factors, any of which could have an adverse effect on sales. We are a
start-up operation in an immature market. Our revenues will initially tend to
take the form of pilot projects with large organizations leading to full
acceptance only on proof of our technology. This may tend to lead to an uneven
revenue stream. This trend may potentially also be exacerbated by long sales
lead times resulting in delays in receiving revenues.
We will operate with low backlog levels for product license sales.
Consequently, the volume of orders in a given quarter will have a significant
impact on the revenues for that quarter. Since our expense levels are based on
projected revenue expectations, if our backlog levels fall below those
expectations, then losses may increase.
We anticipate a potential decline in margins in our market.
As the network management and security market matures, we anticipate
that there will be a move towards packaging of multiple functional elements at
"less than the sum of the parts" pricing. We believe that we will not experience
a decline in earnings if we can achieve our market share objectives in the early
market phase and can move towards a higher level of service based revenue
streams as margins decline. Failure to achieve these two objectives would have
serious, long term consequences for our profitability, if any, and our share
price.
Rapidly changing technologies may render our product suite obsolete or
unmarketable.
The network management and security market is subject to rapid
technological change and innovation. Customer requirements are also subject to
significant short-term changes. As a result, we must continuously adapt and
improve our product suite in response to changes in operating systems,
application software, computer and communications hardware, network software,
programming tools and computer language technology. The introduction of products
embodying new technologies and the emergence of new industry standards may
render some or all of our existing products obsolete or unmarketable.
In particular, the market for Internet, Intranet and Extranet
applications is very new and is evolving rapidly. Our operating results will
depend upon our ability to remain abreast of these advances. We cannot assure
you that we will be successful in developing new products or product
enhancements that respond to technological changes and evolving industry
standards. We also cannot be certain that we will not experience difficulties
that could delay or prevent successful development, introduction or marketing of
these products, or that the new products will adequately meet the developing
needs of the market and achieve market acceptance. If we do not respond
adequately to the need for developing and introducing new products or
enhancements to our existing products in a timely manner in response to changing
market conditions or customer requirements, our business, operating results and
financial condition could be materially adversely affected.
Our package of software may not be accepted as a proprietary standard.
Our future success will depend in part on the adoption of our software
package as a proprietary standard by potential customers. This adoption may be
jeopardized by a public perception that the use of client-side software results
in a loss of flexibility and ease of access to software systems. Our view is
that our package of software is a valuable tool for assuring and enhancing tight
and continuing security, and that other commonly used Internet capabilities
require the use of client software. In order to utilize our package of software
to attain information security at a high level of confidentiality and integrity,
we must persuade customers either to adopt our package of software as a
proprietary standard or that our product suite will significantly facilitate
migration to a more secure environment. If we do not achieve either of these
objectives, then our business, operating results and financial condition could
be materially adversely affected.
We face strong competition, especially in North America.
We face strong competition, particularly in North America where the
majority of our competitors are based. We expect our revenue to be derived from
sales of software security products, systems integration, consulting and support
services, and sales of hardware and other products. We face and expect to
continue to face competition in each of these market areas from various existing
and emerging information security providers. Many of these companies have
greater name recognition, longer operating histories, larger customer bases and
significantly greater financial, marketing, sales and other resources. We
generally do not seek exclusive relationships with our business and technology
partners; these partners may also compete with us from time to time. We expect
to face increasing competitive pressures from our current competitors and new
market entrants. We cannot accurately predict the size of our market, and if our
market is not as large as we expect, our business prospects will suffer. The
markets for our product suite is rapidly evolving and we cannot assure you that
the Internet or common public protocols will continue to be used to facilitate
communications or that the market for network management and security systems
will continue to expand. Continued growth of this market will depend, in large
part, upon the continued expansion of Internet usage and the number of
organizations adopting or expanding intranets and upon the ability of their
respective infrastructures or complementary products and services to be
developed in a timely manner. Consequently, if the network management, security,
Internet and intranet markets fail to grow at the rate that we anticipate, then
our future business, operating results and financial condition could be
materially adversely affected.
Our success depends on our ability to protect our proprietary technology.
We rely on a combination of copyright, trademark, service mark and
trade secret laws, confidentiality procedures and contractual restrictions to
establish and protect the proprietary rights in our software and services.
However, we will not be able to protect our intellectual property if we are
unable to enforce our rights or if we do not detect unauthorized use of our
intellectual property. In addition, these legal protections only provide us with
limited protection. If we litigate to enforce our rights, it would be expensive,
divert management resources and may not be adequate to protect our business. Our
inability to protect our proprietary technology could have a material adverse
effect on our business, prospects, financial condition and results of
operations.
We may not have adequate remedies for infringement by others of our
product suite. We have five patent applications pending in the U.S. for our
Authoriszor product suite and we believe that such products may be patentable in
the U.S. However, because patent applications in the U.S. are confidential, we
cannot rule out the existence of earlier-filed patent applications for
technology similar or identical to our product suite, or the possibility that
another party may first secure patent protection in substantially similar
technology. Therefore, we cannot guarantee that our patent applications will be
successful. We may attempt to extend any successful U.S. applications into the
UK and other countries through the Paris Convention and the Patent Cooperation
treaties; however, patent applications for software are more difficult to obtain
in some countries outside the U.S. Even where patent protection is obtained, we
cannot guarantee that third parties will not oppose or otherwise challenge the
patents granted. If we do not succeed in securing patents in the U.S., UK and
other territories, or if any granted patent is successfully challenged, we may
not be able to prevent the marketing of products similar to ours based on the
underlying technology by other persons in that territory.
We cannot assure you that others will not develop technologies that are
similar or superior to our technology. Despite our efforts to protect our
proprietary rights, unauthorized uses of our product suite will be difficult to
prevent, and although we are unable to predict the extent to which piracy of our
software products may occur, software piracy can be expected to be a persistent
problem. In addition, the laws of some foreign countries may not protect our
proprietary rights as fully as do the laws of the U.S. and the UK. We also
cannot assure you that our competitors will not independently develop similar
technology.
We may rely on technology that we license from third parties, including
software that is integrated with and into our product suite and which is
critical to the functionality of our product suite. Should we lose the right to
incorporate such software into our product suite, we would be required to seek
substitute software products, the lack of which or the use of which could
negatively affect the functionality and viability of our product suite.
We cannot assure you that third parties will not claim infringement by
us with respect to current or future products. We expect that software companies
will increasingly be subject to infringement claims as the number of products
and competitors in our industry segment grows and the functionality of products
in different industry segments overlaps. Responding to such claims, regardless
of merit, could be time consuming, result in costly litigation, cause product
shipment delays or require us to enter into royalty or licensing agreements.
Such royalty or licensing agreements, if required, may not be available on terms
acceptable to us or at all, which could have a material adverse effect upon our
business, operating results and financial condition.
We do not have registered trademark protection for all logos we use. We
do not have trademarks for any of the Authoriszor brand names/logos in the U.S.
We cannot guarantee that any trademark application for the Authoriszor brand
names/logos will be approved by the relevant governmental authority. Even if
appropriate applications were made and approved, third parties may oppose or
otherwise challenge such applications or registrations. Failure to obtain
trademark registrations in the territories in which we intend to market our
business could limit our ability to use the brand names/logos in those
territories. While we are not aware of any encumbrances in our ownership of, or
that any third parties are infringing upon our intellectual property rights and
we do not believe that the Authoriszor product suite infringes upon any third
party rights, the developers of the product did not give warranties to the
effect that there was no third party infringement when they transferred the
intellectual property to us. Our success depends on retaining our current key
personnel and attracting additional personnel, particularly in the areas of
management, sales and distribution, client support and technical services. Our
success will depend largely on the continuing efforts of our executive officers
and senior management, especially those of Paul Ayres, our President and Chief
Executive Officer, and Andrew Cussons, our Chief Financial Officer. Our business
may be adversely affected if the services of these officers or any of our other
key personnel become unavailable to us.
We have increased our sales and distribution and administrative staff
in the UK and have built sales and distribution and administrative
infrastructures in the U.S. If we fail to attract and retain qualified personnel
to staff these positions, particularly in the U.S., our business and prospects
will likely be adversely affected.
We are currently expanding our technical services staff and will need
to increase our staff further to support expected new clients. The initiation of
new clients, the integration of our security solutions and ongoing client
support can be complex. Accordingly, we need highly trained client support,
technical personnel and outside consultants. Hiring client support and technical
personnel is very competitive in our industry due to the limited number of
people available with the necessary technical skills and understanding of our
software package. Our inability to attract, hire, train or retain the number of
highly qualified client support and technical services personnel that our
business needs, or the inability to hire qualified outside consultants to
perform these tasks, may cause our business and prospects to suffer.
Our U.S. operation may not be successful.
We anticipate that the main market for our product suite will be the
U.S. Prior to the first quarter of 2000, our operations had been based solely in
the UK. We believe that our target market, the U.S., cannot successfully be
penetrated, either geographically or culturally, by a small UK-based operation.
Additionally, we believe that the presence of U.S.-based employees in our U.S.
headquarters operation is a basic requirement for successful U.S. market
penetration. Accordingly, in the first quarter of 2000, we opened a U.S.
operational office. We cannot assure you that our planned U.S. operations will
be successful. If we fail to access our target market quickly, we may be at a
significant competitive disadvantage against our competitors. A significant
threat to the achievement of our marketing goals is any delay in the time to
market of our product suite. We predict that delays in the marketing program may
result in an early lead being gained by one or more companies that already
supply Web security products. In that case, differentiated positioning will
become more important and we will need to be more explicit in our marketing or
the chance of market share gain will be adversely affected. Our pricing policy
will also suffer as a result of any attempt to win market share and grow brand
from a weaker position. If we fail to achieve fast time to market in the U.S.,
our business, operating results and financial condition could be materially
adversely affected.
Our product suite may be defective and we may face product liability lawsuits.
Our product suite will be used for network management and security
functions which may be critical to organizations and, as a result, the eventual
sale and support of products by us may entail the risk of product liability and
related claims. We intend to attempt to explicitly limit our liability in our
contracts; however, we cannot guarantee that contractual limitations on
liability will protect us from liability in any of the nations or states in
which we do business. We currently have no product liability insurance. A
product liability claim brought against us could have a materially adverse
effect on our business, operating results and financial condition.
Software products as complex as those we offer may contain undetected
errors or failures when first introduced or when new versions are released and
errors or failures may also emerge, once any version has been in use for some
time. In particular, the personal computer hardware environment is characterized
by a wide variety of non-standard configurations that make pre-release testing
for programming or compatibility errors very difficult and time consuming.
Despite our testing we cannot assure you that errors could not result in adverse
publicity, loss or delay in market acceptance, or claims by customers against
us, any of which could have a material adverse effect upon our business,
operating results and financial condition.
We have a limited operating history in the area of Internet and network
security.
We have been engaged in our current Internet and network security
business since July 22, 1999. Our activities have primarily been in research and
development, and elements of our product suite are in an early stage of
development. We have a limited operating history in the Internet and network
security business upon which our performance and prospects can be evaluated. We
face risks frequently encountered by developing businesses. These risks include
our potential inability to compete with more established firms and to retain and
maintain key personnel, as well as uncertainty as to which areas we should
target for growth and expansion and as to the source of funding for operations
and expansion.
Our success depends on the continued growth in use of the Internet.
Rapid growth in the use of and interest in the Internet is a recent
phenomenon. We cannot assure you that acceptance and use of the Internet will
continue to develop or that a sufficient base of users will emerge to support
our business. Sales of our product suite will depend largely on the widespread
acceptance and increased use of the Internet as a source of information and as a
vehicle for commerce and business. If use of the Internet does not continue to
grow or grows more slowly than we expect, or if the Internet infrastructure does
not effectively support growth that may occur, our business will be adversely
affected.
Due to the increasing popularity of the Internet, laws and regulations
applicable to Internet communications, commerce, advertising and direct
marketing are becoming more prevalent. The adoption or modification of such laws
or regulations could inhibit the growth of Internet use and decrease the
acceptance of the Internet as a communications and commercial medium, which
could decrease demand for our product suite and have a material adverse effect
on our business, results of operations and financial condition.
Failure to raise additional capital or generate the significant capital
necessary to expand our operations and invest in new products could reduce our
ability to compete and result in lower revenue
We anticipate that our existing capital resources will enable us to
maintain currently planned operations for at least the next twelve months.
However, we premise this expectation on our current operating plan, which may
change as a result of many factors. Consequently, we may need additional funding
sooner than anticipated. Our presumed inability to raise capital would seriously
harm our business and product development efforts. In addition, we may choose to
raise additional capital due to market conditions or strategic considerations
even if we believe we have sufficient funds for our current or future operating
plans. To the extent that additional capital is raised through the sale of
equity or other securities, the issuance of these securities could result in
dilution to our stockholders. We currently have no credit facility or committed
sources of capital other than cash valued as of December 31, 2000 at
approximately $19.8 million.
To the extent operating and capital resources are insufficient to meet
future requirements, we will have to raise additional funds to continue the
development and commercialization of our technologies. These funds may not be
available on favorable terms, or at all. If adequate funds are not available on
attractive terms, we may be required to curtail operations significantly or to
obtain funds by entering into financing, supply or other agreements on
unattractive terms.
Our acquisitions and ventures may disrupt or otherwise have a negative impact on
our business.
We intend to enter into new business opportunities and ventures to
build marketing and distribution capabilities. Typically, such opportunities
require extended negotiations and the investment of a substantial amount of
capital and will impose substantial burdens on our management personnel and our
financial and operational systems. We cannot assure you that such venture(s) or
acquisitions will be appropriately integrated or ever achieve or sustain
profitability.
We face risks in foreign markets.
We own subsidiaries, conduct operations and market our product suite
internationally. Conducting business in most countries will require us to become
familiar with and to comply with foreign laws, rules, regulations and customs.
We have limited experience conducting foreign business and we cannot assure
investors that we will be successful. Moreover, our failure to comply with
foreign laws, rules and regulations of which we are not aware may harm the
development of our business. Further risks are inherent in international
operations, including the following:
o differing levels of Internet use in other countries;
o customers' agreements may be difficult to enforce and
receivables difficult to collect through a foreign country's
legal system;
o foreign customers may have longer payment cycles;
o foreign countries may tax our foreign income and tax rates in
certain foreign countries may exceed those of the United
States and foreign earnings may be subject to withholding
requirements or the imposition of tariffs, exchange controls
or other restrictions;
o intellectual property rights may be more difficult to enforce
in foreign countries;
o fluctuations in exchange rates may affect product demand and
may adversely affect the profitability in US dollars of
products and services provided by us in foreign markets where
payment for our product suite and services is made in the
local currency;
o fluctuations in exchange rates may adversely affect the
proceeds of the placement that we deposited in pound sterling
denominated accounts.
o general economic conditions in the countries in which we
operate could have an adverse effect on our earnings from
operations in those countries;
o unexpected changes in foreign laws or regulatory requirements
may occur, which could interfere with our business or
operations;
o compliance with a variety of foreign laws and regulations may
prove difficult; and
o an overlap of different tax structures may prove too complex
to administer effectively,
There can be no assurance that any of these factors will not have a
material adverse effect on our business and results of operations.
RISKS RELATED TO OWNING OUR COMMON STOCK
The exercise of warrants and options to purchase our shares will have dilutive
effect.
There are currently outstanding warrants and options to purchase
2,896,413 shares of our common stock. There are additionally options to
purchase, in the aggregate, 992,284 shares of common stock available to be
issued under our 1999 and 2000 stock option plans. These options and warrants
provide an opportunity for holders to profit from a rise in the market price of
our shares of common stock with resulting dilution in the ownership interest
held by you. Holders of these securities may opt to exercise them and receive
the underlying shares of common stock at a time when we are seeking to obtain
additional capital by an offering. As a result, the terms, including price, on
which we may be able to obtain additional capital could be adversely affected.
We have anti-takeover defenses that could delay or prevent a takeover that
stockholders may consider favorable. We have 2,000,000 shares of preferred stock
authorized in our Certificate of Incorporation, none of which are currently
issued and outstanding. The preferred stock may be issued with such
designations, rights and preferences as may be determined from time to time by
our Board. Accordingly, our Board is empowered, without stockholder approval,
but subject to applicable government regulatory restrictions and applicable
corporate laws, including the fiduciary duties of our directors, to issue
preferred stock with dividend, liquidation, conversion, voting or other rights
senior to the holdings of shares of common stock. If issued, the preferred stock
could be utilized as a method of discouraging, delaying or preventing a change
in control. Although we have no present intention to issue any additional shares
of our preferred stock, we cannot assure you that we will not do so in the
future.
We are also subject to certain provisions of Delaware law (Section 203
of the Delaware General Corporation Law) which may have the effect of
discouraging unsolicited takeover offers. Our stock will likely be subject to
substantial price and volume fluctuations due to a number of factors, some of
which are beyond our control. The market price of our shares of common stock may
be subject to wide fluctuations. Reasons for future fluctuations may include
variations in industry growth rates, general economic conditions, divergence in
financial results from analysts' expectations, changes in earnings estimates by
stock market analysts, our size relative to the market and other events and
factors. Stock prices and trading volumes for many Internet-related companies
fluctuate widely, often for reasons that may be unrelated to their businesses or
results of operations. In addition, international stock markets have from time
to time experienced extreme price and volume fluctuations which have affected
the market prices of securities and which have often been unrelated to the
operating performance of the companies affected.
These broad market fluctuations, as well as general economic and
political conditions, could adversely affect the market price for our shares of
common stock. We are at risk of securities class action litigation and
regulatory inquiry due to our expected stock price volatility. In the past,
securities class action litigation and regulatory inquiries have been brought
against a company following periods of volatility in the market price of its
securities. In the future we may be the target of similar litigation or
inquiries. Even if groundless and ultimately unsuccessful, securities litigation
and regulatory inquiries may result in substantial costs and divert management's
attention and resources, which may seriously harm our business, prospects,
financial condition and results of operations and may also harm our reputation.
We face risks related to exchange rates.
A proportion of our revenues are expected to be received in non-US
currencies and, in particular, we anticipate that a proportion of our revenues
will be received in Euros. This may give rise to an exchange risk against U.S.
dollars.
We may engage from time to time in foreign exchange hedging in respect
of the principal foreign currencies in which our receivables are denominated.
There can be no assurance that such hedging activities will continue or will be
effective to limit the impact of any movements in exchange rates on our results
or operations.
Our executive officers and directors in the aggregate control approximately
26.3% of our voting stock.
Our directors and executive officers will together own beneficially
approximately 26.3% of the issued and outstanding shares of common stock of
Authoriszor Inc., including options exercisable within 60 days of the date of
this prospectus by such directors and executive officers. If these stockholders
were to vote all of their shares in a similar manner, they would have sufficient
voting power to significantly influence the outcome of any corporate transaction
or any matter submitted to the stockholders for approval, including the election
of directors, mergers, consolidations or the sale of all or substantially all of
our assets, and to prevent or cause a change in control.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements. These statements
relate to future events or our future financial performance. We have attempted
to identify forward-looking statements by terminology including "anticipates,"
"believes," "can," "continue," "could," "estimates," "expects," "intends,"
"may," "plans," "potential," "predicts," "should" or "will" or the negative of
these terms or other comparable terminology. These statements are only
predictions and involve known and unknown risks, uncertainties and other
factors, including the risks outlined under "Risk Factors," that may cause our
or our industry's actual results, levels of activity, performance or
achievements to be materially different from any future results, levels or
activity, performance or achievements expressed or implied by these
forward-looking statements.
Although we believe that the expectations reflected in the
forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. We are not under any duty to
update any of the forward-looking statements after the date of this prospectus
to conform these statements to actual results, unless required by law.
USE OF PROCEEDS
We will not receive any proceeds from the sale of common stock by the
selling stockholders.
PLAN OF DISTRIBUTION; SELLING STOCKHOLDERS
This prospectus relates to 2,271,933 shares of our common stock that
may be offered and sold from time to time by our selling stockholders. Set forth
below is information provided by our selling stockholders, as of the date of
this prospectus, regarding the beneficial ownership of shares of our common
stock by each selling stockholder.
Common Stock
Beneficially Owned
After Offering(2)
Number of Shares
of Common Stock Number of
Beneficially Owned Shares of Common
Selling Stockholders Prior to Offering(1) Stock Offered Number Percent
- -------------------- -------------------- ----------------- ------ -------
3i plc..................................... 68,800 68,800 0 *
ABN AMRO Bank NV........................... 2,500 2,500 0 *
Alexander, David Turnbull.................. 1,373 1,373 0 *
Alexander, Nicholas ....................... 915 915 0 *
Allied Commercial Exports Ltd.............. 3,500 3,500 0 *
Apax Partners & Co......................... 28,000 28,000 0 *
Archdream Limited.......................... 2,500 2,500 0 *
Aros Securities AB......................... 2,000 2,000 0 *
Bank of Copenhagen......................... 20,000 20,000 0 *
Bergson, Sheila............................ 1,147 1,147 0 *
Deutsche Asset Management.................. 28,000 28,000 0 *
Duncan Lawrie Ltd.......................... 90,000 90,000 0 *
Eagle & Dominion Asset Mgmt................ 105,000 105,000 0 *
Ellis Partners Ltd......................... 60,000 60,000 0 *
Fiske & Co................................. 46,000 46,000 0 *
Freeman, Harvey............................ 682 682 0 *
John Harold Haynes......................... 4,500 4,500 0 *
Index IT Partnership....................... 76,081 76,081 0 *
JM Finn & Co............................... 5,000 5,000 0 *
JO Hambro Asset Management................. 70,000 70,000 0 *
JO Hambro Investment Mgmt.................. 6,500 6,500 0 *
Julius Baer Asset Management............... 590,000 590,000 0 *
Jupiter Asset Management................... 340,000 340,000 0 *
Laing & Cruickshank........................ 182,900 182,900 0 *
Lawman, David Peter........................ 330 330 0 *
Lewis, Gwilym Alexander Graham............. 664 664 0 *
Lewis, Justin Llewellyn Gareth ............ 265 265 0 *
Lewis, Melissa Harriet Christian........... 442 442 0 *
Lewis, Gareth Richard Lewis................ 664 664 0 *
Lewis, Rosemary Frances.................... 265 265 0 *
Mangareva S.A.............................. 1,829 1,829 0 *
Marwyn c/oRingwood Investments Ltd......... 14,000 14,000 0 *
Petercam s.a............................... 50,000 50,000 0 *
PI Capital................................. 183 183 0 *
Rathbone Laurence Keen Ltd................. 4,000 4,000 0 *
Reabourne Limited.......................... 64,000 64,000 0 *
Rothschild Asset Management Ltd............ 102,000 102,000 0 *
Schroder Investment Mgmt Int'l Ltd......... 22,000 22,000 0 *
Smith & Williamson......................... 112,000 112,000 0 *
SocGen Asset Management.................... 45,000 45,000 0 *
Societe Generale Asset Management.......... 3,000 3,000 0 *
STG Asset Management AG.................... 8,000 8,000 0 *
Tarnhelm Securities Ltd.................... 900 900 0 *
Taylor Young Investment Mgmt Ltd........... 31,000 31,000 0 *
Tolley, Julian John........................ 993 993 0 *
R. Hadyn Silleck........................... 37,000 25,000 12,000 *
Peter S. Daley............................. 35,000 25,000 10,000 *
Jay Lutsky................................. 97,000 25,000 72,000 *
- --------------------
* Indicates less than 1%.
(1) Unless otherwise indicated, to our knowledge, the persons and entities
named in the table have sole voting and sole investment power with
respect to all shares of our common stock beneficially owned, subject
to community property laws where applicable. Represents those shares of
common stock held by the selling stockholders, if any, together with
those shares that such selling stockholder has the right to acquire
upon exercise of warrants or otherwise within 60 days.
(2) Because the selling stockholders may sell all or a portion of their
shares of common stock pursuant to this prospectus at any time and from
time to time, no estimate can be made of the number of shares of common
stock that each selling stockholder may retain upon completion of the
offering by the selling stockholders. Therefore, this table assumes
that all shares of our common stock offered by this prospectus by each
selling stockholder are actually sold. Such presentation is based on
17,526,784 shares of our common stock outstanding as of February 14,
2001.
Placement Shares
The shares of our common stock beneficially owned by certain of our
selling stockholders were acquired on February 18, 2000, in a placement of
2,727,273 shares of our common stock at a price of $11.00 per share. However,
certain selling stockholders have, in the period between the effectiveness of
our registration statement, and now, sold shares in accordance with the "Plan of
Distribution; Selling Stockholders" section of the prospectus contained therein.
The original placement was made pursuant to Regulation S under the Securities
Act in the United Kingdom and Europe. In connection with the placement, we
agreed to file the registration statement of which this prospectus forms a part.
We agreed to grant certain registration rights to the holders of our
shares from the placement under a Registration Rights Agreement dated February
16, 2000, entered into in anticipation of the completion of the placement. The
Registration Rights Agreement provides that we are obligated to prepare and file
with the Securities and Exchange Commission a registration statement of which
this prospectus forms a part, with respect to the offer and sale of the shares
from the placement by the holders from time to time. See "Description of Capital
Stock-Registration Rights Agreement."
Warrant Shares
The remaining shares of our common stock beneficially owned by the
selling stockholders were acquired in a merger transaction involving the
acquisition of Toucan Mining Plc. Certain stockholders of our predecessor,
Starlight Acquisitions, Inc., received warrants to purchase our shares of common
stock. The Starlight warrants entitle their holders to purchase from us, on or
before the six month anniversary of the closing of the first registration of an
offering of our securities pursuant to the Securities Act, 100,000 shares of our
common stock at the purchase price of $4.00 per share, subject to adjustment as
provided in the Warrant Agreement. These warrants have been exercised resulting
in the issuance of 100,000 shares of our common stock to the warrant holders.
Starlight warrant holders are entitled to certain "piggyback
registration" rights, which, subject to certain limitations and restrictions,
will permit such Starlight warrant holders to include their Starlight warrant
shares in this registration statement. However, certain selling stockholders
holding our warrant shares have, in the period between the effectiveness of the
registration statement, of which this prospectus forms a part, and now, sold
shares in accordance with the "Plan of Distribution; Selling Stockholders"
section of the prospectus contained therein
Except as specifically set forth in this prospectus, none of the
selling stockholders has, or within the past three years has had, any position,
office or other material relationship with us or any of our predecessors or
affiliates.
We have been advised by the selling stockholders that they or, subject
to applicable law, their pledgees, donees, distributees, transferees or other
successors in interest, intend to sell all or a portion of the shares of common
stock offered by this prospectus from time to time:
o on the NASDAQ National Market;
o otherwise than on the NASDAQ National Market;
o in negotiated transactions at fixed prices which may be
changed;
o at market prices prevailing at the time of sale or at
reasonably related prices or at negotiated prices; or
o by a combination of the foregoing methods of sale, any of
which may involve crosses and block transactions.
The selling stockholders may effect such transactions by selling the
shares of common stock to or through broker-dealers, and such broker-dealers may
receive compensation in the form of discounts, concessions or commissions from
the selling stockholders and/or the purchasers of the shares of common stock for
which such broker-dealers may act as agent or to whom they may sell as
principal, or both. We are not aware as of the date of this prospectus of any
agreements between any of the selling stockholders and any broker-dealers with
respect to the sale of the shares of common stock offered by this prospectus. In
connection with distributions of the shares of common stock or otherwise, the
selling stockholders may enter into hedging transactions with broker-dealers. In
connection with such transactions, broker-dealers may engage in short sales of
the shares of common stock registered under this prospectus in the course of
hedging the positions they assume with selling stockholders. The selling
stockholders may also sell shares of our common stock short and deliver the
shares of common stock to close out such short positions. The selling
stockholders may also enter into option or other transactions with
broker-dealers which require the delivery to the broker-dealer of the shares of
common stock registered under this prospectus, which the broker-dealer may
resell pursuant to this prospectus. The selling stockholders may also pledge the
shares of common stock registered hereunder to a broker or dealer and upon a
default, the broker or dealer may effect sales of the pledged shares of common
stock pursuant to this prospectus.
The selling stockholders and any broker, dealer or other agent
executing sell orders on behalf of the selling stockholders may be deemed to be
"underwriters" within the meaning of the Securities Act, in which event
commissions received by any such broker, dealer or agent and profit on any
resale of the shares of principal may be deemed to be underwriting commissions
under the Securities Act. Such commissions received by a broker, dealer or agent
may be in excess of customary compensation. The shares of common stock may also
be sold in accordance with Section 4(1) of the Securities Act or Rule 144 and
Rule 145 under the Securities Act.
Information as to whether underwriters who may be selected by the
selling stockholders, or any other broker-dealer, is acting as principal or
agent for the selling stockholders, the compensation to be received by
underwriters who may be selected by the selling stockholders, or any
broker-dealer, acting as principal or agent for the selling stockholders and the
compensation to be received by other broker-dealers, will, to the extent
required by law be set forth in a supplement to this prospectus. Any dealer or
broker participating in any distribution of the shares of our common stock may
be required to deliver a copy of this prospectus, including the prospectus
supplement, if any, to any person who purchases any of the shares of our common
stock from or through such dealer or broker.
All expenses of registration incurred in connection with the offering
will be borne by us. All selling and other expenses incurred by the selling
stockholders will be borne by the selling stockholders.
The selling stockholders will be subject to applicable provisions of
the Securities Exchange Act and its rules and regulations, including without
limitation, Rule 102 under Regulation M, which provisions may limit the timing
of purchases and sales of any of the common stock by the selling stockholders.
Rule 102 under Regulation M provides, with certain exceptions, that it is
unlawful for a selling stockholder or its affiliated purchaser to, directly or
indirectly, bid for or purchase or attempt to induce any person to bid for or
purchase, for an account in which the selling stockholder or affiliated
purchaser has a beneficial interest in any securities that are the subject of
the distribution during the applicable restricted period under Regulation M. All
of the foregoing may affect the marketability of the common stock. We will
require each selling stockholder, and his or her broker if applicable, to
provide a letter that acknowledges his compliance with Regulation M under the
Securities Exchange Act before authorizing the transfer of such selling
stockholder's shares of common stock.
The selling stockholders may offer all of the shares of common stock
for sale. Further, because it is possible that a significant number of shares
could be sold at the same time under this prospectus, such sales, or the
possibility thereof, may have a depressive effect on the market price of our
common stock.
We have agreed to indemnify the selling stockholders against certain
liabilities in connection with the registration statement, of which this
prospectus is a part, including certain liabilities under the Securities Act.
LEGAL MATTERS
The validity of the common stock offered by this prospectus has been
passed upon by Jenkens & Gilchrist, a Professional Corporation.
EXPERTS
The consolidated financial statements of Authoriszor Inc. as of June
30, 2000 and 1999 and for the years then ended and for the period January 15
(date of inception) to June 30, 1997 and 2000 have been audited by Grant
Thornton.
The financial statements of WRDC Limited as of July 31, 1999 and for
the year ended have been audited by Brown Butler.
The financial statements of WRDC Limited as of July 31, 1998 and 1997
and for the years then ended have been audited by Marcus Phillips.
Each have been included in this prospectus and in the registration
statement in reliance on the authority of those firms as experts in accounting
and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are a reporting company and file annual, quarterly and current
reports, proxy statements and other information with the SEC. You may read and
copy these reports, proxy statements and other information at the SEC's public
reference rooms in Washington, DC, New York, NY and Chicago, IL. You can request
copies of these documents by writing to the SEC and paying a fee for the copying
cost. Please call the SEC at 1-800-SEC-0330 for more information about the
operation of the public reference rooms. Our SEC filings are also available at
the SEC's web site at "http://www.sec.gov." In addition, you can read and copy
our SEC filings at the office of the National Association of Securities Dealers,
Inc. at 1735 "K" Street, Washington, DC 20006.
INCORPORATION BY REFERENCE
The SEC permits us to "incorporate by reference" certain of our
publicly-filed documents into this prospectus, which means that information
included in those documents is considered part of this prospectus. Information
that we file with the SEC after the effective date of this prospectus will
automatically update and supersede this information. We incorporate by reference
the documents listed below and any future filings made with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, or
until we terminate the effectiveness of this registration statement.
The following documents filed with the SEC are incorporated by
reference in this prospectus:
1. Our Quarterly Report on Form 10-QSB for the quarter ended December 31,
2000, filed on February 14, 2001;
2. Our Current Report on Form 8-K, filed on January 30, 2001;
3. Our Quarterly Report on Form 10-QSB for the quarter ended September 30,
2000, filed on November 14, 2000;
4. Our Notice of Annual Meeting and Definitive Proxy Statement for the
2000 Annual Meeting of Stockholders, filed on October 10, 2000;
5. Our Annual Report on Form 10-KSB for the year ended June 30, 2000,
filed on September 29, 2000;
6. The description of our common stock contained in our Registration
Statement on Form 8-A, filed on May 18, 2000, including any amendments
or reports filed for the purpose of updating such description; and
7. Our Current Report on Form 8-K, filed on March 8, 2000, as amended by
our Current Report on Form 8-K/A, filed on May 8, 2000.
We will furnish without charge to you, upon written or oral request, a
copy of any or all of the documents incorporated by reference. You should direct
any requests for documents to:
AUTHORISZOR INC.
One Van de Graaff Drive
Suite 502
Burlington, Massachusetts 01803-5188
Phone: (781) 359-9650
Fax: (781) 359-9654
This prospectus is part of a registration statement we filed with the
SEC. You should rely only on the information incorporated by reference or
provided in this prospectus and the registration statement.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
Our certificate of incorporation, as amended, and bylaws provide that
we will indemnify our directors to the full extent permitted by the General
Corporation Law of the State of Delaware and may indemnify our officers and
employees to such extent, except that we will not be obligated to indemnify any
such person with respect to proceedings, claims or actions initiated or brought
voluntarily by any such person and not by way of defense, without our prior
written consent, or for any amounts paid in settlement of an action indemnified
against by us without our prior written consent.
In addition, our certificate of incorporation, as amended, and bylaws
provide that our directors will not be personally liable to us or our
stockholders for monetary damages for breach of his or her fiduciary duty as a
director, except for liability:
o for any breach of the director's duty of loyalty to us or our
stockholders;
o for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law;
o for willful or negligent conduct in paying dividends or
repurchasing stock out of other than lawfully available funds;
or
o for any transaction from which the director derives an
improper personal benefit.
Reference is made to Section 145 of the General Corporation Law of the State of
Delaware which provides for indemnification of directors and officers in certain
circumstances. Section 145 requires us to indemnify such persons against
expenses, judgments, fines, settlements and other amounts actually and
reasonably incurred, including expenses of a derivative action, in connection
with any proceeding, whether actual or threatened, to which any such person may
be made a party by reason of the fact that such person is or was our director or
executive officer or a director or executive officer of any of our affiliated
enterprises, provided such person acted in good faith and in a manner such
person reasonably believed to be in or not opposed to our best interests and,
with respect to any criminal proceeding, has no reasonable cause to believe his
or her conduct was unlawful.
We have entered into an employment agreement with Richard A. Langevin
under which we agreed to indemnify Mr. Langevin and hold him harmless, at a
minimum in accordance with the provisions contained in our Certificate of
Incorporation and Bylaws, against any losses, claims, damages, liabilities,
costs, expenses, including advancing from time to time his attorney's fees and
expenses in advance of the final disposition of any claim, action, suit,
proceeding or investigation, judgments, fines and amounts paid in settlement in
connection with any threatened or actual claim, action, suit, proceeding or
investigation, whether civil, criminal or administrative, in which the executive
is, or is threatened to be, made a party by reason of having been our Director
or officer or serving or having served at our request as a director, trustee,
officer, employee or agent of another corporation or of a partnership, joint
venture, trust or other enterprise, including service with respect to an
employee benefit plan, whether the basis of such proceeding is alleged action or
failure to act in an official capacity as a director, trustee, officer employee
or agent, provided that we will have choice of counsel in any such action. Our
obligations under such indemnification provisions will survive the termination
of his employment agreement. Notwithstanding the foregoing, we will not be
obligated to indemnify Mr. Langevin beyond the extent permissible under Section
145 of the Delaware General Corporation Law and other applicable law, including,
without limitation, applicable securities law.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers, or persons controlling us pursuant
to the foregoing provisions, we have been informed that in the opinion of the
SEC such indemnification is against public policy as expressed in the Securities
Act and is therefore unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by us of
expenses incurred or paid by a director, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted by any
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 us is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses, other than the
underwriting discounts and commissions, payable by Authoriszor in connection
with the registration of the common stock. All the amounts shown are estimates
except for the registration fee.
Securities and Exchange Commission registration fee....... $19,220
Nasdaq National Market fee................................ $95,000
Printing and engraving expenses........................... $81,000
Legal fees and expenses................................... $150,000
Accounting fees and expenses.............................. $50,000
Miscellaneous............................................. $ --
-------
Total..................................................... $395,220
========
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
See "Disclosure of Commission Position on Indemnification For Securities Act
Liabilities" in the prospectus.
ITEM 16. EXHIBITS.
The following exhibits are filed as part of this registration
statement. Exhibit numbers correspond to the exhibits required by Item 601 of
Regulation S-K.
Exhibit No. Description
2.1(1) Agreement and Plan of Merger, dated July 29, 1996, by and
among Toucan Gold Corporation and Starlight Acquisitions, Inc.
(included in Exhibit 2.1)
2.2(2) Share Exchange Agreement, dated May 10, 1996, by and among
Starlight Acquisitions, Inc. and Toucan Mining Limited
(included in Exhibit 2.1)
2.3(3) Share Sale Agreement regarding ITIS Technologies Ltd., dated
July 22, 1999, by and among David J. Blanchfield, James L.
Jackson, David R. Wray, Barry Jones, Ian McNeill and Toucan
Gold Corporation (Exhibit 10.1)
5.1* Opinion and consent of Jenkens & Gilchrist, a Professional
Corporation, as to legality of the common stock to be issued
by Authoriszor Inc.
23.1+ Consent of Grant Thornton (UK)
23.2+ Consent of Brown Butler
23.3+ Consent of Marcus Phillips
23.4+ Consent of Jenkens & Gilchrist, a Professional Corporation
(included in Exhibit 5.1)
24.1^ Power of Attorney of certain officers and directors of
Authoriszor Inc.
- -----------
(1) Incorporated by reference to the exhibit shown in parenthesis included
in our Current Report on Form 8-K, dated July 29, 1996.
(2) Incorporated by reference to the exhibit shown in parenthesis included
in our Current Report on Form 8-K, dated May 13, 1996.
(3) Incorporated by reference to the exhibit shown in parenthesis included
in our Current Report on Form 8-K, dated August 6, 1999.
+ Filed herewith.
* Previously filed as an exhibit to this registration statement.
^ Reference is made to page II-3 of this registration statement.
II-1
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(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 reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in the 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 Commission pursuant to Rule 424(b) if, in the aggregate
offering price set forth in the "Calculation of Registration Fee" table
in the effective registration statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
(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.
(4) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement 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 the
initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the provisions referenced in Item 15 of this
registration statement or otherwise, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission this indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against these
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer, or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by a director,
officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question of whether the indemnification by it is against public
policy as expressed in the Securities Act of 1933, and will be governed by the
final adjudication of this issue.
II-2
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Post
Effective Amendment No. 1 to Form S-1 on Form S-3 Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Boston, Commonwealth of Massachusetts, on the 16th day of February, 2001.
AUTHORISZOR INC.
By: /s/ Paul Ayres
----------------------------------
Paul Ayres,
President and Chief Executive Officer
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed below by the following persons in the
capacities and on the dates stated. Each of the directors and/or officers of
whose signature appears below hereby appoints Paul Ayres, as his
attorney-in-fact to sign in his or her name and behalf, in any and all
capacities stated below and to file with the Securities and Exchange Commission
any and all amendments, including further post-effective amendments, to this
Post Effective Amendment No. 1 to Form S-1 on Form S-3, making such changes in
the registration statement as appropriate, and generally to do all such things
on their behalf in their capacities as directors and/or officers to enable
Authoriszor Inc. to comply with the provisions of the Securities Act, and all
requirements of the Securities and Exchange Commission.
Signature Title Date
/s/ Paul Ayres
------------------------------ President and Chief Executive Officer and Director (Principal February 16, 2001
Paul Ayres Executive Officer)
/s/ Andrew Cussons
------------------------------ Chief Financial Officer, Secretary and Director (Principal February 16, 2001
Andrew Cussons Accounting and Financial Officer)
/s/ Raymond G. H. Seitz
------------------------------ Chairman of the Board February __, 2001
Raymond G. H. Seitz
/s/ James L. Jackson
------------------------------ Director February 16, 2001
James L. Jackson
/s/ David R. Wray
------------------------------ Director February __, 2001
David R. Wray
/s/ Sir Malcolm Rifkind
------------------------------ Director February 16, 2001
Sir Malcolm Rifkind
/s/ Geoff Shingles
------------------------------ Director February __, 2001
Geoff Shingles
/s/ Don Box
------------------------------ Director February 16, 2001
Don Box
II-3
EXHIBIT INDEX
Exhibit No. Description
2.1(1) Agreement and Plan of Merger, dated July 29, 1996, by and among Toucan
Gold Corporation and Starlight Acquisitions, Inc. (included in Exhibit
2.1)
2.2(2) Share Exchange Agreement, dated May 10, 1996, by and among Starlight
Acquisitions, Inc. and Toucan Mining Limited (included in Exhibit 2.1)
2.3(3) Share Sale Agreement regarding ITIS Technologies Ltd., dated July 22,
1999, by and among David J. Blanchfield, James L. Jackson, David R.
Wray, Barry Jones, Ian McNeill and Toucan Gold Corporation. (Exhibit
10.1)
5.1* Opinion and consent of Jenkens & Gilchrist, a Professional Corporation,
as to legality of the common stock to be issued by Authoriszor Inc.
23.1+ Consent of Grant Thornton (UK)
23.2+ Consent of Brown Butler
23.3+ Consent of Marcus Phillips
23.4+ Consent of Jenkens & Gilchrist, a Professional Corporation (included in
Exhibit 5.1)
24.1^ Power of Attorney of certain officers and directors of Authoriszor Inc.
- -----------
(4) Incorporated by reference to the exhibit shown in parenthesis included
in our Current Report on Form 8-K, dated July 29, 1996.
(5) Incorporated by reference to the exhibit shown in parenthesis included
in our Current Report on Form 8-K, dated May 13, 1996.
(6) Incorporated by reference to the exhibit shown in parenthesis included
in our Current Report on Form 8-K, dated August 6, 1999.
+ Filed herewith.
* Previously filed as an exhibit to this Registration Statement.
^ Reference is made to page II-3 of this Registration Statement.