2
As filed with the Securities and Exchange Commission on March 12, 2000
Commission File Number
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT
Under The Securities Act of 1933
Wahoo Capital Ventures, Inc.
Nevada 56-2165342
(State or other (Primary Standard Industrial (I.R.S. Employer
jurisdictions Classification Code Number) Identification number)
of incorporation
or organization
Carolina Building, Suite 222
Hilton Head, SC 29938
Telephone: 843-686-5590
(Address and telephone number of registrant's principal executive
offices and principal place of business.)
Resident Agents of Nevada
711 South Carson Street
Carson City, Nevada 89701
(775) 882-4641
(Name, address and telephone number of agent for service.)
with copies to:
Jody M. Walker
Attorney At Law
7841 South Garfield Way
Littleton, Colorado 80122
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, check the following box: | x |
CALCULATION OF REGISTRATION FEE
Title of each Proposed Proposed Amount of
class of Amount to be offering aggregate registration
securities registered price(2) offering price fee
common stock
$.001 par value(1) 1,270,000 $ .10 $127,000 $ 35.31
common stock(3) 780,000 $ .50 $390,000 $ 108.42
common stock(4) 780,000 $ .75 $585,000 $ 162.63
common stock(5) 3,900,000 $4.00 $15,600,000 $4,336.80
6,730,000 $16,702,000 $4,643.16
(1)Represents common stock being registered on behalf of Selling
Security Holders.
(2)Arbitrary value solely for purposes of computing the registration
fee
(3)Represents common stock underlying A warrants to be registered on
behalf of selling security holders.
(4)Represents common stock underlying B warrants to be registered on
behalf of selling security holders.
(5)Represents common stock underlying C warrants being registered on
behalf of selling security holders.
The registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states
that this registration statement shall thereafter become effective in
accordance with Section 8(a) of the Securities Act of 1933 or until the
registration statement shall become effective on such date as the
Commission, acting pursuant to said Section 8(a), may determine.
3
Preliminary Prospectus Dated March 12, 2000
SUBJECT TO COMPLETION
1,270,000 common shares on behalf of selling security holders
780,000 common shares underlying A warrants on behalf of
selling security holders
780,000 common shares underlying B warrants on behalf of
selling security holders
1,560,000 common shares underlying C warrants on behalf of
selling security holders
WAHOO CAPITAL VENTURES, INC.
We will not receive any cash or other proceeds in connection with the
subsequent sale by selling security holders.
Each selling security holder may be deemed to be an underwriter under
the Securities Act of 1933.
Our common stock does not trade. Our management has agreed to use its
best efforts to apply for the quotation of its common stock on the NASD
Electronic Bulletin Board.
Consider carefully the risk factors beginning on page 10 in this
prospectus.
Neither the SEC nor any state securities commission has approved these
common shares or determined that this prospectus is accurate or
complete. Any representation to the contrary is a criminal offense.
The information in this prospectus 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.
The date of the prospectus is March 12, 2000.
4
TABLE OF CONTENTS
PROSPECTUS SUMMARY 5
RISK FACTORS 6
SELLING SECURITY HOLDERS 7
TERMS OF THE OFFERING 10
DILUTION 11
SOURCE AND USE OF PROCEEDS 11
WAHOO 11
PLAN OF OPERATION 18
MANAGEMENT 19
Officers and Directors
Remuneration
Indemnification
PRINCIPAL SHAREHOLDERS 19
SHARES ELIGIBLE FOR FUTURE SALE 20
MARKET FOR REGISTRANT'S COMMON EQUITY 20
DESCRIPTION OF SECURITIES 21
INDEMNIFICATION 21
LEGAL MATTERS 22
LEGAL PROCEEDINGS 22
ADDITIONAL INFORMATION 22
EXPERTS 23
INTERESTS OF NAMED EXPERTS AND COUNSEL 23
FINANCIAL STATEMENTS 23
5
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information, financial statements and notes to the financial statements
including the notes thereto appearing elsewhere in this prospectus.
Wahoo Our executive offices are located Carolina Building,
Suite 222, Hilton Head, SC 29938. These offices
consist of 500 square feet, which are provided by a
past officer at $200 per year. Our telephone number
is 843-686-5590.
Corporate
Operations. We are a development stage company. We will seek an
acquisition or merger candidate.
Sales by Selling
Security Holders. We are registering common shares on behalf of selling
security holders in this prospectus. We will not
receive any cash or other proceeds in connection with
the subsequent sale. We are not selling any common
shares on behalf of selling security holders and have
no control or affect on these selling security
holders.
Financial
Constraints We currently have only $16,420 in working capital and
may not have sufficient funds to locate a merger or
acquisition candidate.
Market for
Common Stock We currently have no active trading market for the our
securities. We can not offer assurance that an
active trading and/or a liquid market will develop in
our securities.
Absence of Dividends;
Dividend Policy We do not currently intend to pay regular cash
dividends on our common stock; Our board of directors
will review this policy from time to time in light of,
among other things, our earnings and financial
position. We do not anticipate paying dividends on
our common stock in the foreseeable future.
Transfer Agent RTT Transfers, Inc. located at 530 merchant St. in
Vacaville, CA 95688 is the transfer agent for our
securities.
6
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RISK FACTORS
- ----------------------------------------------------------
1. Several States have laws restricting or prohibiting the sale of
securities of a blank check company like ours. You may not be able to
sell your securities in a secondary market.
Several states have restricted the ability to register or qualify
shares for both initial sale and secondary trading. Our selling
effects and any secondary market, which may develop may only be
conducted in states, which have an applicable exemption or registration
provision.
2. We have a limited operating history and have no certainty of
future operating results.
Since our incorporation in 1999, our activities have been principally
devoted to positioning ourselves to achieve our business objectives.
We have had no material operating revenue to date and expect to incur
losses and administrative expenses until we locate merger or
acquisition candidate. To date, we have an operating loss of $29,830
for the period from inception to December 31, 1999. See "Management's
Discussion and Analysis of Financial Condition."
3. If our common stock has no active trading market, you may not be
able to sell your common shares easily.
We do not have a public market for our common shares. We cannot assure
you that a public market will ever develop. Consequently, you may not
be able to liquidate their investment in the event of an emergency or
for any other reason.
4. If we cannot afford the cost of being a public company, we may not
remain current in our filings and you may not be able to trade your
stock.
Given our limited financial abilities, we may not be able to absorb the
costs of preparing and filing the necessary documents with the
Securities and Exchange Commission. If we attempt to remain current
in our filings, we may not be able to locate an acquisition candidate..
We estimate that it would cost approximately $4,000 to $5,000 per year
in legal and accounting fees to comply under the '34 Act.
5. We do not meet the requirements for our stock to be quoted on
NASDAQ and the tradability in our stock will be limited under the penny
stock regulation.
. If the trading price of our common stock is less than $5.00 per
share, trading in the common stock would also be subject to the
requirements of Rule 15g-9 under the Exchange Act. Under this rule,
broker/dealers who recommend low-priced securities to persons other
than established customers and accredited investors must satisfy
special sales practice requirements. The broker/dealer must make an
individualized written suitability determination for the purchaser and
receive the purchaser's written consent prior to the transaction.
SEC regulations also require additional disclosure in connection with
any trades involving a "penny stock", including the delivery, prior to
any penny stock transaction, of a disclosure schedule explaining the
penny stock market and its associated risks. Such requirements severely
limit the liquidity of the common stock in the secondary market because
few broker or dealers are likely to undertake such compliance
activities. Generally, the term penny stock refers to a stock with a
market price of less than $5.00 per share.
6. The selling shareholders may have liability because of their
status as underwriters.
Under the Securities Act of 1933, the selling security holders will be
considered to be underwriters of the offering. The selling security
holders may have civil liability under Section 11 and 12 of the
Securities Act for any omissions or misstatements in the registration
statement because of their status as underwriters.
7. We are not registering the warrants. The warrants will remain
restricted and you will not be able to sell the warrants in the public
market.
7
We are only registering the common shares underlying the warrants. The
warrants will remain restricted. No public market will be made in the
warrants.
8. We have not identified any possible business and cannot identify any
specific business risks. You could lose your entire investment.
Wahoo has not identified and has no commitments to enter into or
acquire a specific business opportunity and therefore can disclose the
risks and hazards of a business or opportunity that it may enter into
in only a general manner, and cannot disclose the risks and hazards of
any specific business or opportunity that it may enter into. You can
expect a potential business opportunity to be quite risky.
Wahoo's acquisition of or participation in a business opportunity
will likely be highly illiquid and could result in a total loss to
Wahoo and its stockholders if the business or opportunity proves to
be unsuccessful.
9. We cannot conduct an exhaustive investigation and will depend on
outside individuals for information to chose our acquisition candidate.
Wahoo's limited funds and the lack of full-time management will likely
make it impracticable to conduct a complete and exhaustive
investigation and analysis of a business opportunity before we commit
our capital or other resources. Management decisions will likely be
made without detailed feasibility studies, independent analysis, market
surveys and the like which, if Wahoo had more funds available to it,
would be desirable.
opportunity investigated is eventually acquired
10. We may leverage the acquisition of a merger candidate and incur
debt which we may not be able to repay.
There is a possibility that any acquisition of a business opportunity
by Wahoo may be leveraged, i.e., Wahoo may finance the acquisition
of the business opportunity by borrowing against the assets of the
business opportunity to be acquired, or against the projected future
revenues or profits of the business opportunity. This could increase
Wahoo's exposure to larger losses.
Any business opportunity acquired through a leveraged transaction
is profitable only if it generates enough revenues to cover the related
debt and expenses. Failure to make payments on the debt incurred to
purchase the business opportunity could result in the loss of a portion
or all of the assets acquired. We cannot assure you that any business
opportunity acquired through a leveraged transaction will generate
sufficient revenues to cover the related debt and expenses.
- --------------------------------------
SELLING SECURITY HOLDERS
- --------------------------------------
Wahoo shall register pursuant to this prospectus 1,270,000 common
shares currently outstanding for the account of the following
individuals or entities. The percentage owned prior to and after the
offering reflects all of the then outstanding common shares. The
amount and percentage owned after the offering assumes the sale of all
of the common shares being registered on behalf of the selling security
holders.
Name Amount Total Number % Owned Number of % Owned
Being Owned Prior to Shares Owned After
Registered Currently offering After offering offering
Colin Moody 10,000 4,400,000 .30.56%% 4,390,000 30.49%
Dale Benson 10,000 4,400,000 .30.56%% 4,390,000 30.49%
Joanne Murphy 10,000 4,400,000 .30.56%% 4,390,000 30.49%
Timothy Miles 650,000 650,000 4.51% 0 0%
Joel R. Shine 200,000 200,000 1.39% 0 0%
Kevin Tatsugawa 10,000 10,000 .07% 0 0%
John Wong 10,000 10,000 .07% 0 0%
Patrick Gundlach 10,000 10,000 .07% 0 0%
Tom Geise 10,000 10,000 .07% 0 0%
Raymond Uno 10,000 10,000 .07% 0 0%
Michael T. Hinchey 10,000 10,000 .07% 0 0%
8
Paul Spiegler 10,000 10,000 .07% 0 0%
Erich Schmid 10,000 10,000 .07% 0 0%
Gary R. See 10,000 10,000 .07% 0 0%
Cassia L. Miles and
Ronda Shaheen 10,000 10,000 .07% 0 0%
Abigail Miles 10,000 10,000 .07% 0 0%
James Yanai 10,000 10,000 .07% 0 0%
John Poli 10,000 10,000 .07% 0 0%
Elizabeth Gheen 10,000 10,000 .07% 0 0%
Paul M. Kasden 10,000 10,000 .07% 0 0%
Dean Cummings 10,000 10,000 .07% 0 0%
Mary Ann Lang 10,000 10,000 .07% 0 0%
James Potter 20,000 20,000 .12% 0 0%
Beryl Salerno 10,000 10,000 .07% 0 0%
Kazu Fujita 10,000 10,000 .07% 0 0%
William R. Shine 10,000 10,000 .07% 0 0%
Robert Ichikawa 10,000 10,000 .07% 0 0%
Gary Kihs 10,000 10,000 .07% 0 0%
Robert Watson 10,000 10,000 .07% 0 0%
Thomas Bass 10,000 10,000 .07% 0 0%
Kevin Robinson 10,000 10,000 .07% 0 0%
Subrina Hamasaki 10,000 10,000 .07% 0 0%
Mitsuo Tatsugawa 10,000 10,000 .07% 0 0%
Derek and Chandra Cholakian 10,000 10,000 .07% 0 0%
Scott Thompson and
Christina Lindquist JT 10,000 10,000 .07% 0 0%
Dale R. Benson 10,000 10,000 .07% 0 0%
Curtis Spackman 10,000 10,000 .07% 0 0%
Fred Norman Quadros Jr. Trust 10,000 10,000 .07% 0 0%
Karen Fellbaum 10,000 10,000 .07% 0 0%
Nancy Jewell 10,000 10,000 .07% 0 0%
Christopher B. Larkby 10,000 10,000 .07% 0 0%
Christopher Lackman 10,000 10,000 .07% 0 0%
R.E. Hunt 10,000 10,000 .07% 0 0%
Wahoo shall register pursuant to this prospectus 780,000 common shares
underlying A warrants currently outstanding for the account of the
following individuals or entities. The percentage owned prior to and
after the offering reflects all of the then outstanding warrants. The
amount and percentage owned after the offering assumes the exercise and
sale of all of the common shares underlying the A warrants being
registered on behalf of the selling security holders.
Name Amount Total Number % Owned Number of % Owned
Being Owned Prior to A Warrants Owned After
Registered Currently offering After offering offering
Kevin Tatsugawa 20,000 20,000 .07% 0 0%
John Wong 20,000 20,000 .07% 0 0%
Patrick Gundlach 20,000 20,000 .07% 0 0%
Tom Geise 20,000 20,000 .07% 0 0%
Raymond Uno 20,000 20,000 .07% 0 0%
Michael T. Hinchey 20,000 20,000 .07% 0 0%
Paul Spiegler 20,000 20,000 .07% 0 0%
Erich Schmid 20,000 20,000 .07% 0 0%
Gary R. See 20,000 20,000 .07% 0 0%
Cassia L. Miles and
Ronda Shaheen 20,000 20,000 .07% 0 0%
Abigail Miles 20,000 20,000 .07% 0 0%
James Yanai 20,000 20,000 .07% 0 0%
John Poli 20,000 20,000 .07% 0 0%
Elizabeth Gheen 20,000 20,000 .07% 0 0%
Paul M. Kasden 20,000 20,000 .07% 0 0%
Dean Cummings 20,000 20,000 .07% 0 0%
Mary Ann Lang 20,000 20,000 .07% 0 0%
James Potter 20,000 20,000 .12% 0 0%
Beryl Salerno 20,000 20,000 .07% 0 0%
Kazu Fujita 20,000 20,000 .07% 0 0%
William R. Shine 20,000 20,000 .07% 0 0%
Robert Ichikawa 20,000 20,000 .07% 0 0%
Gary Kihs 20,000 20,000 .07% 0 0%
Robert Watson 20,000 20,000 .07% 0 0%
Thomas Bass 20,000 20,000 .07% 0 0%
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Kevin Robinson 20,000 20,000 .07% 0 0%
Subrina Hamasaki 20,000 20,000 .07% 0 0%
Mitsuo Tatsugawa 20,000 20,000 .07% 0 0%
Derek and Chandra Cholakian 20,000 20,000 .07% 0 0%
Scott Thompson and
Christina Lindquist JT 20,000 20,000 .07% 0 0%
Dale R. Benson 20,000 20,000 .07% 0 0%
Curtis Spackman 20,000 20,000 .07% 0 0%
Fred Norman Quadros Jr. Trust 20,000 20,000 .07% 0 0%
Karen Fellbaum 20,000 20,000 .07% 0 0%
Nancy Jewell 20,000 20,000 .07% 0 0%
Christopher B. Larkby 20,000 20,000 .07% 0 0%
Christopher Lackman 20,000 20,000 .07% 0 0%
R.E. Hunt 20,000 20,000 .07% 0 0%
Wahoo shall register pursuant to this prospectus 780,000 common
shares underlying the B warrants currently outstanding for the account
of the following individuals or entities. The percentage owned prior to
and after the offering reflects all of the then outstanding warrants.
The amount and percentage owned after the offering assumes the exercise
and sale of all of the common shares underlying the B warrants being
registered on behalf of the selling security holders.
Name Amount Total Number % Owned Number of % Owned
Being Owned Prior to B Warrants Owned
After
Registered Currently offering After offering
offering
Kevin Tatsugawa 20,000 20,000 .07% 0 0%
John Wong 20,000 20,000 .07% 0 0%
Patrick Gundlach 20,000 20,000 .07% 0 0%
Tom Geise 20,000 20,000 .07% 0 0%
Raymond Uno 20,000 20,000 .07% 0 0%
Michael T. Hinchey 20,000 20,000 .07% 0 0%
Paul Spiegler 20,000 20,000 .07% 0 0%
Erich Schmid 20,000 20,000 .07% 0 0%
Gary R. See 20,000 20,000 .07% 0 0%
Cassia L. Miles and
Ronda Shaheen 20,000 20,000 .07% 0 0%
Abigail Miles 20,000 20,000 .07% 0 0%
James Yanai 20,000 20,000 .07% 0 0%
John Poli 20,000 20,000 .07% 0 0%
Elizabeth Gheen 20,000 20,000 .07% 0 0%
Paul M. Kasden 20,000 20,000 .07% 0 0%
Dean Cummings 20,000 20,000 .07% 0 0%
Mary Ann Lang 20,000 20,000 .07% 0 0%
James Potter 20,000 20,000 .12% 0 0%
Beryl Salerno 20,000 20,000 .07% 0 0%
Kazu Fujita 20,000 20,000 .07% 0 0%
William R. Shine 20,000 20,000 .07% 0 0%
Robert Ichikawa 20,000 20,000 .07% 0 0%
Gary Kihs 20,000 20,000 .07% 0 0%
Robert Watson 20,000 20,000 .07% 0 0%
Thomas Bass 20,000 20,000 .07% 0 0%
Kevin Robinson 20,000 20,000 .07% 0 0%
Subrina Hamasaki 20,000 20,000 .07% 0 0%
Mitsuo Tatsugawa 20,000 20,000 .07% 0 0%
Derek and Chandra Cholakian 20,000 20,000 .07% 0 0%
Scott Thompson and
Christina Lindquist JT 20,000 20,000 .07% 0 0%
Dale R. Benson 20,000 20,000 .07% 0 0%
Curtis Spackman 20,000 20,000 .07% 0 0%
Fred Norman Quadros Jr. Trust 20,000 20,000 .07% 0 0%
Karen Fellbaum 20,000 20,000 .07% 0 0%
Nancy Jewell 20,000 20,000 .07% 0 0%
Christopher B. Larkby 20,000 20,000 .07% 0 0%
Christopher Lackman 20,000 20,000 .07% 0 0%
R.E. Hunt 20,000 20,000 .07% 0 0%
Wahoo shall register pursuant to this prospectus 3,120,000 common
shares underlying the B warrants currently outstanding for the account
of the following individuals or entities. The percentage owned prior to
and after the offering reflects all of the then outstanding warrants.
10
The amount and percentage owned after the offering assumes the exercise
and sale of all of the common shares underlying the C warrants being
registered on behalf of the selling security holders.
Name Amount Total Number % Owned Number of % Owned
Being Owned Prior to C Warrants Owned
After
Registered Currently offering After offering
offering
Kevin Tatsugawa 100,000 100,000 .07% 0 0%
John Wong 100,000 100,000 .07% 0 0%
Patrick Gundlach 100,000 100,000 .07% 0 0%
Tom Geise 100,000 100,000 .07% 0 0%
Raymond Uno 100,000 100,000 .07% 0 0%
Michael T. Hinchey 100,000 100,000 .07% 0 0%
Paul Spiegler 100,000 100,000 .07% 0 0%
Erich Schmid 100,000 100,000 .07% 0 0%
Gary R. See 100,000 100,000 .07% 0 0%
Cassia L. Miles and
Ronda Shaheen 100,000 100,000 .07% 0 0%
Abigail Miles 100,000 100,000 .07% 0 0%
James Yanai 100,000 100,000 .07% 0 0%
John Poli 100,000 100,000 .07% 0 0%
Elizabeth Gheen 100,000 100,000 .07% 0 0%
Paul M. Kasden 100,000 100,000 .07% 0 0%
Dean Cummings 100,000 100,000 .07% 0 0%
Mary Ann Lang 100,000 100,000 .07% 0 0%
James Potter 100,000 100,000 .12% 0 0%
Beryl Salerno 100,000 100,000 .07% 0 0%
Kazu Fujita 100,000 100,000 .07% 0 0%
William R. Shine 100,000 100,000 .07% 0 0%
Robert Ichikawa 100,000 100,000 .07% 0 0%
Gary Kihs 100,000 100,000 .07% 0 0%
Robert Watson 100,000 100,000 .07% 0 0%
Thomas Bass 100,000 100,000 .07% 0 0%
Kevin Robinson 100,000 100,000 .07% 0 0%
Subrina Hamasaki 100,000 100,000 .07% 0 0%
Mitsuo Tatsugawa 100,000 100,000 .07% 0 0%
Derek and Chandra Cholakian 100,000 100,000 .07% 0 0%
Scott Thompson and
Christina Lindquist JT 100,000 100,000 .07% 0 0%
Dale R. Benson 100,000 100,000 .07% 0 0%
Curtis Spackman 100,000 100,000 .07% 0 0%
Fred Norman Quadros Jr. Trust 100,000 100,000 .07% 0 0%
Karen Fellbaum 100,000 100,000 .07% 0 0%
Nancy Jewell 100,000 100,000 .07% 0 0%
Christopher B. Larkby 100,000 100,000 .07% 0 0%
Christopher Lackman 100,000 100,000 .07% 0 0%
R.E. Hunt 100,000 100,000 .07% 0 0%
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TERMS OF THE OFFERING
- ----------------------------------------------------------
Plan of Distribution. Wahoo is not selling any common shares on
behalf of selling security holders and has no control or affect on the
common shares being registered on behalf of these selling security
holders.
Our common shares are not traded currently on the over-the-counter
market. The selling security holders may sell their common shares in
one or more transactions. These may include "block" transactions in
the over-the-counter market, if one develops, in negotiated
transactions or in a combination of such methods of sales, at fixed
prices which may be changed, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at
negotiated prices.
The selling security holders may effect such transactions by selling
the common shares directly to purchasers, or may sell to or through
agents, dealers or underwriters designated from time to time, and such
agents, dealers or underwriters may receive compensation in the form of
discounts, concessions or commissions from the selling security holders
and/or the purchaser(s) of the common shares for whom they my act as
agent or to whom they may sell as principals, or both.
11
The selling security holders and any agents, dealers or underwriters
that act in connection with the sale of the common shares might be
deemed to be underwriters within the meaning of Section 2(11) of the
Securities Act, and any discount or commission received by them and any
profit on the resale of the common shares as principal might be deemed
to be underwriting discounts or commissions under the Securities Act.
Wahoo is not aware of any current or future plans, proposals,
arrangements or understandings by any selling security holders to
distribute their registered shares of common stock of Wahoo to
their respective outstanding shareholders or partners.
Wahoo is not aware of any plans, arrangements or understandings by
any selling security holders to sell their registered shares of common
stock to any particular individual(s) or to use such registered shares
to satisfy contractual obligations.
Wahoo will receive no portion of the proceeds from the sale of the
common shares by the selling security holders and will bear all of the
costs relating to the registration of this offering (other than any
fees and expenses of counsel for the selling security holders). Any
commissions, discounts or other fees payable to a broker, dealer,
underwriter, agent or market maker in connection with the sale of any
of the common shares will be borne by the selling security holders.
Determination of exercise price of warrants. The exercise price and
other terms of the warrants were arbitrarily determined by Wahoo
after considering the our financing needs and the possible dilution to
existing and new shareholders.
Offering Period. This offering will terminate on or before
December 31, 2000.
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DILUTION
- --------------------------------------------------------------
Further Dilution. We may issue additional restricted common shares
pursuant to private business transactions. Any sales under Rule 144
after the applicable holding period may have a depressive effect upon
the market price of the Company's common shares and investors in this
offering upon conversion.
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SOURCE AND USE OF PROCEEDS
- --------------------------------------------------------------
Any proceeds received from the subsequent exercise of the A, B and C
warrants shall be used as working capital and to expand operations of
any acquisition candidate.
Due to the uncertainty of the timing and amount of actual funds which
may be received upon exercise of the warrants, no specific breakdown of
uses have been established by Wahoo. The aggregate amount of
proceeds if all of the warrants are exercised is $16,575,000. If all
of the A,B, and C warrants are exercised, the proceeds shall be
utilized over a four year period.
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WAHOO
- -------------------------------------------------------
General
Wahoo was incorporated under the laws of the State of Nevada on
August 3, 1999. Wahoo is in the early developmental and
promotional stages. To date Wahoo's only activities have been
organizational ones, directed at developing our business plan and
raising our initial capital. Wahoo has not commenced any
commercial operations. Wahoo has no employees and owns no real
estate. Wahoo can be defined as a shell company whose sole
purpose at this time is to locate and consummate a merger or
acquisition with a private entity.
12
As part of its business plan, we shall file a registration
statement on Form 8a upon the effectiveness of this registration
statement on Form SB-2 on a voluntary basis in order to become a
public company since we will be of subject to the reporting
requirements of the Securities Exchange Act of 1934.
Another aspect of our business plan which Wahoo intends to implement
after this registration statement becomes effective, is to seek to
facilitate the eventual creation of a public trading market in its
outstanding securities. Wahoo's business plan is to seek,
investigate, and, if warranted, acquire one or more properties or
businesses, and to pursue other related activities intended to enhance
shareholder value.
The acquisition of a business opportunity may be made by purchase,
merger, exchange of stock, or otherwise, and may encompass assets or a
business entity, such as a corporation, joint venture, or partnership.
Wahoo has very limited capital, and it is unlikely that Wahoo
will be able to take advantage of more than one such business
opportunity.
Wahoo intends to seek opportunities demonstrating the potential of
long-term growth as opposed to short-term earnings. At the present time
Wahoo has not identified any business opportunity that it plans to
pursue, nor has Wahoo reached any agreement or definitive
understanding with any person concerning an acquisition.
We anticipate that Wahoo's officers and directors will
contact broker-dealers and other persons with whom he is acquainted
who are involved in corporate finance matters to advise them of
Wahoo's existence and to determine if any companies or businesses
they represent have an interest in considering a merger or acquisition
with Wahoo. We cannot assure you that Wahoo will be
successful in finding or acquiring a desirable business opportunity,
given the limited funds that are expected to be available for
acquisitions, or that any acquisition that occurs will be on terms that
are favorable to Wahoo or its stockholders.
Wahoo's search will be directed toward small and medium-sized
enterprises which have a desire to become public corporations and which
are able to satisfy, or anticipate in the reasonably near future being
able to satisfy, the minimum asset requirements in order to qualify
shares for trading on NASDAQ or on a stock exchange.
Wahoo anticipates that the business opportunities presented to it
will
- be recently organized with no operating history, or a history
of losses attributable to under-capitalization or other factors;
- be experiencing financial or operating difficulties;
- be in need of funds to develop a new product or service or to
expand into a new market;
- be relying upon an untested product or marketing concept;
or
- have a combination of the characteristics mentioned above.
Wahoo intends to concentrate our acquisition efforts on properties
or businesses that it believes to be undervalued. Given the above
factors, investors should expect that any acquisition candidate may
have a history of losses or low profitability. Wahoo does not
propose to restrict its search for investment opportunities to any
particular geographical area or industry, and may, therefore, engage in
essentially any business, to the extent of its limited resources. This
includes industries such as service, finance, natural resources,
manufacturing, high technology, product development, medical,
communications and others.
Wahoo's discretion in the selection of business opportunities is
unrestricted, subject to the availability of such opportunities,
economic conditions, and other factors. As a consequence of this
registration of our securities, any entity, which has an interest in
being acquired by, or merging into Wahoo, is expected to be an
entity that desires to become a public company and establish a public
trading market for its securities. In connection with such a merger or
13
acquisition, it is highly likely that an amount of stock constituting
control of Wahoo would be issued by Wahoo or purchased from the
current principal shareholders of Wahoo by the acquiring entity or
its affiliates.
If stock is purchased from the current shareholders, the transaction is
very likely to result in substantial gains to them relative to their
purchase price for such stock. In Wahoo's judgment, our sole officer
and our directors would not thereby become an "underwriter" within the
meaning of the Section 2(11) of the Securities Act of 1933, as amended.
The sale of a controlling interest by certain principal shareholders of
Wahoo could occur at a time when the other shareholders of Wahoo
remain subject to restrictions on the transfer of their shares.
Depending upon the nature of the transaction, the current officer and
the directors of Wahoo may resign their management position with Wahoo
in connection with Wahoo's acquisition of a business opportunity.
In the event of such a resignation, Wahoo's current management would
not have any control over the conduct of Wahoo's business following
Wahoo's combination with a business opportunity. It is anticipated
that business opportunities will come to Wahoo's attention from
various sources, including its officer and director, its other
stockholders, professional advisors such as attorneys and accountants,
securities broker-dealers, venture capitalists, members of the
financial community, and others who may present unsolicited proposals.
Wahoo has no plans, understandings, agreements, or commitments with
any individual for such person to act as a finder of opportunities for
Wahoo. Wahoo does not foresee that it would enter into a merger
or acquisition transaction with any business with which its officers or
directors are currently affiliated. Should Wahoo determine in the
future, contrary to the foregoing expectations, that a transaction with
an affiliate would be in the best interests of Wahoo and its
stockholders, Wahoo is in general permitted by Colorado law to enter
into such a transaction if:
- The material facts as to the relationship or interest of
the affiliate and as to the contract or transaction are
disclosed or are known to the board of directors, and the
board in good faith authorizes the contract or transaction by
the affirmative vote of a majority of the disinterested
directors, even though the disinterested directors constitute
less than a quorum; or
- The material facts as to the relationship or interest of
the affiliate and as to the contract or transaction are
disclosed or are known to the stockholders entitled to vote
thereon, and the contract or transaction is specifically
approved in good faith by vote of the stockholders; or
- The contract or transaction is fair as to Wahoo as of the
time it is authorized, approved or ratified, by the board of
directors or the stockholders.
Investigation and Selection of Business Opportunities
To a large extent, a decision to participate in a specific business
opportunity may be made upon management's analysis of the quality of
the other company's management and personnel, the anticipated
acceptability of new products or marketing concepts, the merit of
technological changes, the perceived benefit Wahoo will derive from
becoming a publicly held entity, and numerous other factors which are
difficult, if not impossible, to analyze through the application of any
objective criteria.
In many instances, it is anticipated that the historical operations of
a specific business opportunity may not necessarily be indicative of
the potential for the future because of the possible need to shift
marketing approaches substantially, expand significantly, change
product emphasis, change or substantially augment management, or make
other changes. Wahoo will be dependent upon the owners of a business
opportunity to identify any such problems which may exist and to
implement, or be primarily responsible for the implementation of,
required changes.
14
Because Wahoo may participate in a business opportunity with a newly
organized firm or with a firm which is entering a new phase of growth,
it should be emphasized that Wahoo will incur further risks, because
management in many instances will not have proved its abilities or
effectiveness, the eventual market for such company's products or
services will likely not be established, and such company may not be
profitable when acquired.
It is anticipated that Wahoo will not be able to diversify, but will
essentially be limited to one such venture because of Wahoo's
limited financing. This lack of diversification will not permit
Wahoo to offset potential losses from one business opportunity
against profits from another, and should be considered an adverse
factor affecting any decision to purchase Wahoo's securities. It is
emphasized that management of Wahoo may effect transactions having a
potentially adverse impact upon Wahoo's shareholders pursuant to the
authority and discretion of Wahoo's management to complete
acquisitions without submitting any proposal to the stockholders for
their consideration.
Holders of Wahoo's securities should not anticipate that Wahoo
necessarily will furnish such holders, prior to any merger or
acquisition, with financial statements, or any other documentation,
concerning a target company or its business. In some instances,
however, the proposed participation in a business opportunity may be
submitted to the stockholders for their consideration, either
voluntarily by such directors to seek the stockholders' advice and
consent or because state law so requires. The analysis of business
opportunities will be undertaken by or under the supervision of
Wahoo's President, who is not a professional business analyst. See
"Management."
Although there are no current plans to do so, Wahoo's management
might hire an outside consultant to assist in the investigation and
selection of business opportunities, and might pay a finder's fee.
Since Wahoo's management has no current plans to use any outside
consultants or advisors to assist in the investigation and selection of
business opportunities, no policies have been adopted regarding use of
such consultants or advisors, the criteria to be used in selecting such
consultants or advisors, the services to be provided, the term of
service, or regarding the total amount of fees that may be paid.
However, because of the limited resources of Wahoo, it is likely
that any such fee Wahoo agrees to pay would be paid in stock and not
in cash. Otherwise, Wahoo anticipates that it will consider, among
other things, the following factors:
- Potential for growth and profitability, indicated by new
technology, anticipated market expansion, or new products;
- Wahoo's perception of how any particular business
opportunity will be received by the investment community and
by Wahoo's stockholders;
- Whether, following the business combination, the
financial condition of the business opportunity would be, or
would have a significant prospect in the foreseeable future of
becoming sufficient to enable the securities of Wahoo to
qualify for listing on an exchange or on a Wahoo automated
securities quotation system, such as NASDAQ, so as to permit
the trading of such securities to be exempt from the
requirements of a Rule 15g-9 adopted by the Securities and
Exchange Commission.
- Capital requirements and anticipated availability of
required funds, to be provided by Wahoo or from operations,
through the sale of additional securities, through joint
ventures or similar arrangements, or from other sources;
- The extent to which the business opportunity can be
advanced;
- Competitive position as compared to other companies of
similar size and experience within the industry segment as
well as within the industry as a whole;
- Strength and diversity of existing management, or
management prospects that are scheduled for recruitment;
15
- The cost of participation by Wahoo as compared to the
perceived tangible and intangible values and potential; and
- The accessibility of required management expertise,
personnel, raw materials, services, professional assistance,
and other required items. In regard to the possibility that
the shares of Wahoo would qualify for listing on NASDAQ, the
current standards include the requirements that the issuer of
the securities that are sought to be listed have total assets
of at least $4,000,000 and total capital and surplus of at
least $2,000,000, and proposals have recently been made to
increase these qualifying amounts. Many, and perhaps most, of
the business opportunities that might be potential candidates
for a combination with Wahoo would not satisfy the NASDAQ
listing criteria. No one of the factors described above will
be controlling in the selection of a business opportunity, and
management will attempt to analyze all factors appropriate to
each opportunity and make a determination based upon
reasonable investigative measures and available data.
Potentially available business opportunities may occur in many
different industries and at various stages of development, all of which
will make the task of comparative investigation and analysis of such
business opportunities extremely difficult and complex.
Potential investors must recognize that, because of Wahoo's
limited capital available for investigation and management's
limited experience in business analysis, Wahoo may not
discover or adequately evaluate adverse facts about the
opportunity to be acquired. Wahoo is unable to predict when
it may participate in a business opportunity. It expects,
however, that the analysis of specific proposals and the
selection of a business opportunity may take several months or
more.
Prior to making a decision to participate in a business opportunity,
Wahoo will generally request that it be provided with written
materials regarding the business opportunity containing such items as a
description of products, services and company history; management
resumes; financial information; available projections, with related
assumptions upon which they are based; an explanation of proprietary
products and services; evidence of existing patents, trademarks, or
services marks, or rights thereto; present and proposed forms of
compensation to management; a description of transactions between such
company and its affiliates during relevant periods; a description of
present and required facilities; an analysis of risks and competitive
conditions; a financial plan of operation and estimated capital
requirements; audited financial statements, or if they are not
available, unaudited financial statements, together with reasonable
assurances that audited financial statements would be able to be
produced within a reasonable period of time not to exceed 60 days
following completion of a merger transaction; and other information
deemed relevant.
As part of Wahoo's investigation, Wahoo's sole officer and
directors may meet personally with management and key personnel, may
visit and inspect material facilities, obtain independent analysis or
verification of certain information provided, check references of
management and key personnel, and take other reasonable investigative
measures, to the extent of Wahoo's limited financial resources and
management expertise. It is possible that the range of business
opportunities that might be available for consideration by Wahoo
could be limited by the impact of Securities and Exchange Commission
regulations regarding purchase and sale of "penny stocks." The
regulations would affect, and possibly impair, any market that might
develop in Wahoo's securities until such time as they qualify for
listing on NASDAQ or on another exchange which would make them exempt
from applicability of the "penny stock" regulations.
Regulation of Penny Stocks
Wahoo's management believes that various types of potential merger
or acquisition candidates might find a business combination with
Wahoo to be attractive. These include acquisition candidates
desiring to create a public market for their shares in order to enhance
liquidity for current shareholders, acquisition candidates which have
long-term plans for raising capital through the public sale of
securities and believe that the possible prior existence of a public
market for their securities would be beneficial, and acquisition
16
candidates which plan to acquire additional assets through issuance of
securities rather than for cash, and believe that the possibility of
development of a public market for their securities will be of
assistance in that process. Acquisition candidates which have a need
for an immediate cash infusion are not likely to find a potential
business combination with Wahoo to be an attractive alternative.
Form of Acquisition
We cannot predict the manner in which Wahoo may participate in a
business opportunity. Specific business opportunities
will be reviewed as well as the respective needs and desires of
Wahoo and the promoters of the opportunity and, upon the basis of
that review and the relative negotiating strength of Wahoo and such
promoters, the legal structure or method deemed by management to be
suitable will be selected. Such structure may include, but is not
limited to leases, purchase and sale agreements, licenses, joint
ventures and other contractual arrangements. Wahoo may act
directly or indirectly through an interest in a partnership,
corporation or other form of organization. Implementing this
structure may require the merger, consolidation or reorganization of
Wahoo with other corporations or forms of business organization, and
although it is likely, we cannot assure you that Wahoo would be the
surviving entity. In addition, the present management and stockholders
of Wahoo most likely will not have control of a majority of the
voting shares of Wahoo following a reorganization transaction. As
part of such a transaction, Wahoo's existing directors may resign
and new directors may be appointed without any vote by stockholders. It
is likely that Wahoo will acquire our participation in a business
opportunity through the issuance of Common Stock or other securities of
Wahoo.
Although the terms of any such transaction cannot be predicted, it
should be noted that in certain circumstances the criteria for
determining whether or not an acquisition is a so-called "tax free"
reorganization under the Internal Revenue Code of 1986, depends upon
the issuance to the stockholders of the acquired company of a
controlling interest (i.e. 80% or more) of the common stock of the
combined entities immediately following the reorganization. If a
transaction were structured to take advantage of these provisions
rather than other "tax free" provisions provided under the Internal
Revenue Code, Wahoo's current stockholders would retain in the
aggregate 20% or less of the total issued and outstanding shares. This
could result in substantial additional dilution in the equity of those
who were stockholders of Wahoo prior to such reorganization. Any
such issuance of additional shares might also be done simultaneously
with a sale or transfer of shares representing a controlling interest
in Wahoo by the current officers, directors and principal
shareholders.
We anticipate that any new securities issued in any reorganization
would be issued in reliance upon exemptions, if any are available, from
registration under applicable federal and state securities laws. In
some circumstances, however, as a negotiated element of the
transaction, Wahoo may agree to register such securities either at
the time the transaction is consummated, or under certain conditions or
at specified times thereafter. The issuance of substantial additional
securities and their potential sale into any trading market that might
develop in Wahoo's securities may have a depressive effect upon such
market. Wahoo will participate in a business opportunity only after
the negotiation and execution of a written agreement.
Although the terms of such agreement cannot be predicted, generally
such an agreement would require specific representations and warranties
by all of the parties thereto, specify certain events of default,
detail the terms of closing and the conditions which must be satisfied
by each of the parties thereto prior to such closing, outline the
manner of bearing costs if the transaction is not closed, set forth
remedies upon default, and include miscellaneous other terms. As a
general matter, Wahoo anticipates that it, and/or its officers and
principal shareholders will enter into a letter of intent with the
management, principals or owners of a prospective business opportunity
prior to signing a binding agreement. Such a letter of intent will set
forth the terms of the proposed acquisition but will not bind any of
the parties to consummate the transaction. Execution of a letter of
intent will by no means indicate that consummation of an acquisition is
probable. Neither Wahoo nor any of the other parties to the letter
of intent will be bound to consummate the acquisition unless and until
17
a definitive agreement concerning the acquisition as described in the
preceding paragraph is executed. Even after a definitive agreement is
executed, it is possible that the acquisition would not be consummated
should any party elect to exercise any right provided in the agreement
to terminate it on specified grounds. It is anticipated that the
investigation of specific business opportunities and the negotiation,
drafting and execution of relevant agreements, disclosure documents and
other instruments will require substantial management time and
attention and substantial costs for accountants, attorneys and others.
If a decision is made not to participate in a specific business
opportunity, the costs theretofore incurred in the related
investigation would not be recoverable. Moreover, because many
providers of goods and services require compensation at the time or
soon after the goods and services are provided, the inability of
Wahoo to pay until an indeterminate future time may make it
impossible to procure goods and services.
Investment Company Act and Other Regulation
Wahoo may participate in a business opportunity by purchasing,
trading or selling the securities of such business. Wahoo does not,
however, intend to engage primarily in such activities.
Specifically, Wahoo intends to conduct its activities so as to avoid
being classified as an "investment company" under the Investment
Company Act of 1940, and therefore to avoid
application of the costly and restrictive registration and other
provisions of the Investment Act, and the regulations promulgated
thereunder. Section 3(a) of the Investment Act contains the definition
of an "investment company," and it excludes any entity that does not
engage primarily in the business of investing, reinvesting or trading
in securities, or that does not engage in the business of investing,
owning, holding or trading investment securities, defined as - all
securities other than government securities or securities of majority-
owned subsidiaries - the value of which exceeds 40% of the value of its
total assets (excluding government securities, cash or cash items).
Wahoo intends to implement its business plan in a manner, which will
result in the availability of this exception from the definition of
investment company. Consequently, Wahoo's participation in a
business or opportunity through the purchase and sale of investment
securities will be limited.
Wahoo's plan of business may involve changes in its capital
structure, management, control and business, especially if it
consummates a reorganization as discussed above. Each of these areas is
regulated by the Investment Act, in order to protect purchasers of
investment company securities. Since Wahoo will not register as an
investment company, stockholders will not be afforded these
protections.
Any securities which Wahoo might acquire in exchange for its Common
Stock may be "restricted securities" within the meaning of the
Securities Act of 1933 . If Wahoo elects to
resell such securities, such sale cannot proceed unless a registration
statement has been declared effective by the Securities and Exchange
Commission or an exemption from registration is available. Section 4(1)
of the Act, which exempts sales of securities not involving a
distribution, would in all likelihood be available to permit a private
sale. Although the plan of operation does not contemplate resale of
securities acquired, if such a sale were to be necessary, Wahoo
would be required to comply with the provisions of the Act to effect
such resale. An acquisition made by Wahoo may be in an industry
which is regulated or licensed by federal, state or local authorities.
Compliance with such regulations can be expected to be a time-consuming
and expensive process. Competition Wahoo expects to encounter
substantial competition in its efforts to locate attractive
opportunities, primarily from business development companies, venture
capital partnerships and corporations, venture capital affiliates of
large industrial and financial companies, small investment companies,
and wealthy individuals. Many of these entities will have significantly
greater experience, resources and managerial capabilities than Wahoo
and will therefore be in a better position than Wahoo to obtain
access to attractive business opportunities. Wahoo also will
experience competition from other public "blind pool" companies, many
of which may have more funds available than does Wahoo.
18
Wahoo is a development stage company and currently has no employees.
Management of Wahoo expects to use consultants, attorneys and
accountants as necessary, and does not anticipate a need to engage any
full-time employees so long as it is seeking and evaluating business
opportunities. The need for employees and their availability will be
addressed in connection with the decision whether or not to acquire or
participate in specific business opportunities.
Although there is no current plan with respect to its nature or amount,
remuneration may be paid to or accrued for the benefit of, Wahoo's
officers prior to, or in conjunction with, the completion of a business
acquisition.
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PLAN OF OPERATION
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Liquidity and Capital Resources
Wahoo remains in the development stage and, since inception, has
experienced no significant change in liquidity or capital resources.
Wahoo's balance sheet as of December 1999, reflects a current
asset value of $0, and a total asset value of $ in the form of
deferred offering costs. Wahoo will carry out its plan of business
as discussed above. Wahoo cannot predict to what extent its
liquidity and capital resources will be diminished prior to the
consummation of a business combination or whether its capital will be
further depleted by the operating losses (if any) of the business
entity which Wahoo may eventually acquire.
Results of Operations
During the period from June 5, 1987 (inception) through September 30,
1999, Wahoo has engaged in no significant operations other than
organizational activities, acquisition of capital and preparation for
registration of its securities under the Securities Exchange Act of
1934. No revenues were received by Wahoo during this
period.
For the current fiscal year, Wahoo anticipates incurring a loss as a
result of expenses associated with registration under the Securities
Exchange Act of 1934, and expenses associated with locating and
evaluating acquisition candidates. Wahoo anticipates that until a
business combination is completed with an acquisition candidate, it
will not generate revenues other than interest income, and may continue
to operate at a loss after completing a business combination, depending
upon the performance of the acquired business.
Need for Additional Financing
Wahoo believes that our existing capital will not be sufficient to
meet Wahoo's cash needs, including the costs of compliance with the
continuing reporting requirements of the Securities Exchange Act of
1934 for a period of approximately one year. Accordingly,
in the event Wahoo is able to complete a business combination during
this period, it anticipates that its existing capital will not be
sufficient to allow it to accomplish the goal of completing a business
combination. Wahoo will depend on additional advances from
stockholders. There is no assurance, however, that the available
funds will ultimately prove to be adequate to allow it to complete a
business combination, and once a business combination is completed,
Wahoo's needs for additional financing are likely to increase
substantially. No commitments to provide additional funds have been
made by management or other stockholders. Accordingly, there can be no
assurance that any additional funds will be available to Wahoo to
allow it to cover its expenses. Irrespective of whether Wahoo's cash
assets prove to be inadequate to meet Wahoo's operational needs,
Wahoo might seek to compensate providers of services by issuances of
stock in lieu of cash. For information as to Wahoo's policy in
regard to payment for consulting services.
19
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MANAGEMENT
- ---------------------------------------------------------
Officers and Directors. Pursuant to the Certificate of Incorporation,
each Director shall serve until the annual meeting of the stockholders,
or until his successor is elected and qualified. Wahoo's basic
philosophy mandates the inclusion of directors who will be
representative of management, employees and the minority shareholders
of Wahoo. Directors may only be removed for "cause". The term of
office of each officer of Wahoo is at the pleasure of Wahoo's
Board. The term of office for each director is three years.
The principal executive officers and directors of Wahoo are as
follows:
Name Position Term(s) of
Office
Joanne Murphy, age 41 Director From Inception
To Present
Dale R. Benson, age 49 Director From Inception
To Present
Colin Moody, age 33 sole officer/Director From Inception
To Present
Resumes:
Joanne Murphy. Mrs. Murphy has worked in the travel service industry
from 1979 to present. From 1979 to 1994 Mrs. Murphy worked for Imperial
Travel, Inc. of Denver, CO. From 1994 to Present Mrs. Murphy has worked
with Travel 16th Street of Denver, CO. Mrs. Murphy graduated from
Spencerport Highschool in Spencerport, New York in 1976.
Dale R. Benson. From 1972 to present Mr. Benson has been a Professional
Airline Pilot. From 1985 to present Mr. Benson has flown for United
Airlines, and has been a captain since 1993. Mr. Benson received a BS
Degree from the University of Minnesota in 1972. In 1975, Mr. Benson
received a Masters degree in Management and Human Relations from
Webster College of St. Louis.
Colin Moody. Mr. Moody from 1998 has been a Chef at the Haige Point
country club on Daufuski Island, SC. From 1997 to 1998 Mr. Moody was a
manager/chef at Wildberrys Restaurant in Pacific Grove, CA. From 1994
to 1997, Mr. Moody was Co-owner of Sacred Valley Organic Produce in
Santa Cruz, CA. Mr. Moody graduated from Aptos high school in Aptos, CA
in 1984.
Remuneration. Each board member was compensated with 4,400,000 common
shares. No other remuneration has been paid since inception.
Board of Directors Compensation. Members of the board of directors
will receive $250 per meeting if said directors are not separately
compensated by Wahoo and will be required to attend a minimum of
four meetings per fiscal year. All expenses for meeting attendance or
out of pocket expenses connected directly with their Board
representation will be reimbursed by Wahoo. Director liability
insurance may be provided to all members of the board of directors.
Wahoo has not yet obtained such insurance and does not have any
specifics for available cost and coverage. Wahoo does not have a
specific time frame to obtain the insurance. No differentiation is
made in the compensation of "outside directors" and those officers of
Wahoo serving in that capacity.
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PRINCIPAL SHAREHOLDERS
- ----------------------------------------------------------------
There are currently 14,400,000 common shares outstanding, 780,000 A
warrants, 780,000 B warrants and 1,560,000 C warrants. The following
tabulates holdings of shares of Wahoo by each person who, subject
to the above, at the date of this prospectus, holds of record or is
known by management to own beneficially more than 5.0% of the common
shares and, in addition, by all directors and officers of Wahoo
individually and as a group. The following assumes the exercise of
all warrants.
20
Shareholdings at Date of
This prospectus
Number & Class
Name and Address of Shares(1) Percentage
Colin Moody(2)(3) 4,400,000 30.56%
2 Ocean Breeze
Hilton Head, SC 29928
Joanne Murphy(3) 4,400,000 30.56%
3967 Marshall St.
Wheat Ridge, CO 80033
Dale Benson(3) 4,400,000 30.56%
1617 Wellmington East
Carson City, NV 89703
All Officers and Directors 13,200,000 91.57%
As a Group (3 persons)
>
(1)Pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, as
amended, beneficial ownership of a security consists of sole or shared
voting power, including the power to vote or direct the voting, and/or
sole or shared investment power, including the power to dispose or
direct the disposition, with respect to a security whether through a
contract, arrangement, understanding, relationship or otherwise.
Unless otherwise indicated, each person indicated above has sole power
to vote, or dispose or direct the disposition of all shares
beneficially owned, subject to applicable unity property laws.
(2) Mr. Moody is the sole Officer of Wahoo
(3) Mr. Benson, Ms. Murphy and Mr. Moody are Directors of Wahoo
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SHARES ELIGIBLE FOR FUTURE SALE
- ----------------------------------------------------------
Wahoo currently has 14,400,000 shares of common stock outstanding.
Of these, 13,155,000 common shares will be deemed to be "restricted
securities" after the offering and may be sold in compliance with Rule
144 adopted under the Securities Act of 1933. Other securities may be
issued, in the future, in private transactions pursuant to an exemption
from the Securities Act. Rule 144 provides, in essence, that a person
who has held restricted securities for a period of two years may sell
every three months in a brokerage transaction or with a market maker an
amount equal to the greater of 1% of Wahoo's outstanding shares or
the average weekly trading volume, if any, of the shares during the
four calendar weeks preceding the sale. The amount of "restricted
securities" which a person who is not an affiliate of Wahoo may
sell is not so limited. Nonaffiliates may each sell without
limitation shares held for three years. Wahoo will make application
for the listing of its Shares in the over-the-counter market. Sales
under Rule 144 may, in the future, depress the price of Wahoo's
Shares in the over-the-counter market, should a market develop. Prior
to this offering there has been no public market for the common stock
of Wahoo. The effect, if any, of a public trading market or the
availability of shares for sale at prevailing market prices cannot be
predicted. Nevertheless, sales of substantial amounts of shares in
the public market could adversely effect prevailing market prices.
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MARKET FOR REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
- -----------------------------------------------------------
Market Information. Wahoo's common stock is not traded in the
pink sheets or in the OTC Bulletin Board maintained by the NASD.
Holders. The approximate number of holders of record of Wahoo's
.001 par value common stock, as of February 29, 2000 was 43.
Dividends. Holders of Wahoo's common stock are entitled to
receive such dividends as may be declared by its Board of Directors.
21
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DESCRIPTION OF SECURITIES
- ---------------------------------------------------------------
Qualification. The following statements constitute brief summaries of
Wahoo's certificate of incorporation and bylaws, as amended. Such
summaries do not purport to be complete and are qualified in their
entirety by reference to the full text of the Certificate of
Incorporation and Bylaws.
Wahoo's articles of incorporation authorize it to issue up to
49,000,000 common shares, $.001 par value per common share and
1,000,000 preferred shares, $.001 par value per preferred share.
There are currently no preferred shares outstanding. Wahoo is in
the process of amending the Articles of Incorporation to allow the
board of directors to determine the rights and preferences of each
series of preferred shares authorized.
Common Stock.
Liquidation Rights. Upon liquidation or dissolution, each outstanding
common share will be entitled to share equally in the assets of Sea
Shell legally available for distribution to shareholders after the
payment of all debts and other liabilities.
Dividend Rights. There are no limitations or restrictions upon the
rights of the Board of Directors to declare dividends out of any funds
legally available therefor. Wahoo has not paid dividends to date
and it is not anticipated that any dividends will be paid in the
foreseeable future. The Board of Directors initially may follow a
policy of retaining earnings, if any, to finance the future growth of
Wahoo. Accordingly, future dividends, if any, will depend upon,
among other considerations, Wahoo's need for working capital and
its financial conditions at the time.
Voting Rights. Holders of common shares of Wahoo are entitled to
cast one vote for each share held at all shareholders meetings for all
purposes.
Other Rights. Common shares are not redeemable, have no conversion
rights and carry no preemptive or other rights to subscribe to or
purchase additional common shares in the event of a subsequent
offering.
Warrants. Class A warrants are exercisable into one common share at
$.50 for a period of three years. Class B warrant are exercisable into
one common share at $.75 for a period of three years. Class C warrants
are exercisable into one common share at $4.00 for a period of five
years from the close of the offering. . All warrants are callable for
$.01 with 30 days notice. The class A and B warrants expire as of
June 25, 2002 and the class C warrants expire as of June 25, 2005.
The warrants have no dilution provisions.
Transfer Agent. RTT Transfer shall act as Wahoo's transfer agent.
- -----------------------------------------------------------
INDEMNIFICATION
- -----------------------------------------------------------
Our bylaws do not contain a provision entitling any director or
executive officer to indemnification against liability under the
Securities Act of 1933. The Nevada Revised Statutes allow a company to
indemnify its officers, directors, employees, and agents from any
threatened, pending, or completed action, suit, or proceeding, whether
civil, criminal, administrative, or investigative, except under certain
circumstances. Indemnification may only occur if a determination has
been made that the officer, director, employee, or agent acted in good
faith and in a manner, which such person believed to be in the best
interests of the company. A determination may be made by the
shareholders; by a majority of the directors who were not parties to
the action, suit, or proceeding confirmed by opinion of independent
legal counsel; or by opinion of independent legal counsel in the event
a quorum of directors who were not a party to such action, suit, or
proceeding does not exist. Provided the terms and conditions of these
provisions under Nevada law are met, officers, directors, employees,
and agents of the Company may be indemnified against any cost, loss, or
expense arising out of any liability under the '33 Act. Insofar as
indemnification for liabilities arising under the '33 Act may be
permitted to directors, officers and controlling persons of the
22
Company. Wahoo has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against
public policy and is, therefore, unenforceable.
- -----------------------------------------------------------
LEGAL MATTERS
- -----------------------------------------------------------
Certain legal matters with respect to the issuance of the securities
offered hereby will be passed upon by J. M. Walker, Attorney-At-Law.
- --------------------------------------------------------
LEGAL PROCEEDINGS
- --------------------------------------------------------
Wahoo is not involved in any legal proceedings as of the date of
this prospectus.
- --------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------
We have filed with the Securities and Exchange Commission a
registration statement under the Act with respect to the securities
offered hereby. This prospectus does not contain all of the
information set forth in the registration statement, some parts are
omitted in accordance with the rules and regulations of the Commission.
For further information with respect to Wahoo and the securities
offered hereby, reference is made to the Registration Statement.
Copies of such materials may be examined without charge at, or obtained
upon payment of prescribed fees from, the Public Reference Section of
the Commission at Room 1024, telephone number 1-800-SEC-0330, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, DC 20549, at the Chicago
Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and the New York Regional Office, 7 World
Trade Center, New York, New York 10048.
We will voluntarily file periodic reports in the event its obligation
to file such reports is suspended under Section 15(d) of the Exchange
Act.
We will provide without charge to each person who receives a
prospectus, upon written or oral request of such person, a copy of any
of the information that was incorporated by reference in the prospectus
(not including exhibits to the information that is incorporated by
reference unless the exhibits are themselves specifically incorporated
by reference). Requests for copies of said documents should be
directed to John Wong, President.
The Commission maintains a Web site -- //www.sec.gov -- that contains
reports, proxy and information statements and other information
regarding issuers that file electronically with the Commission.
No dealer, salesman, agent or any other person has been authorized to
give any information or to make any representation other than those
contained in this prospectus. If given or made, this information or
representation must not be relied on as having been authorized by Sea
Shell or the underwriter, if an underwriter assists in the sale of the
securities. This prospectus does not constitute an offer or a
solicitation by anyone to any person in any state, territory or
possession of the United States in which the offer or solicitation is
not authorized by the laws thereof, or to any person to whom it is
unlawful to make such offer or solicitation.
Neither the delivery of this prospectus or any sale made hereunder
shall, under any circumstances, create an implication that there has
not been any change in the facts set forth in this prospectus or in the
affairs of Wahoo since the date hereof.
23
- --------------------------------------------------------
EXPERTS
- --------------------------------------------------------
The audited financial statements included in this prospectus have been
so included in reliance on the report of James E. Scheifley &
Associates, P.C., Certified Public Accountants, on the authority of
such firm as experts in auditing and accounting.
- --------------------------------------------------------
INTERESTS OF NAMED
EXPERTS AND COUNSEL
- --------------------------------------------------------
None of the experts or counsel named in the prospectus are
affiliated with Wahoo.
- --------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------
Index to Financial Statements
Independent Auditor's Report dated January 31, 2000
Balance Sheet dated December 31, 1999
Statement of Operations for the period from inception (August 3, 1999
to December 31, 1999
Statement of Changes in Stockholders' Equity from the period from
inception (August 3, 1999) to December 31, 1999
Statements of Cash Flows For the period from inception (August 3, 1999)
to December 31, 1999
Notes to Financial Statements
24
INDEPENDENT AUDITOR'S REPORT
Board of Directors and Shareholders
Wahoo Capital Ventures, Inc.
We have audited the balance sheet of Wahoo Capital Ventures, Inc. as of
December 31, 1999, and the related statements of operations, changes in
stockholders' equity, and cash flows for the period from inception
(August 3, 1999) to December 31, 1999. These financial statements are
the responsibility of the Company's management. Our responsibility is
to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above, present
fairly, in all material respects, the financial position of Wahoo
Capital Ventures, Inc. as of December 31, 1999, and the results of its
operations and cash flows for the period from inception (August 3, 1999)
to December 31, 1999, in conformity with generally accepted accounting
principles.
James E. Scheifley & Associates, P.C.
Certified Public Accountants
Denver, Colorado
January 31, 2000
25
Wahoo Capital Ventures, Inc.
(A Development Stage Company)
Balance Sheet
December 31, 1999
ASSETS
Current assets: 1999
Cash $ 16,420
Accounts receivable for stock issued 3,000
---------
Total current assets 19,420
$ 19,420
STOCKHOLDERS' EQUITY
Current liabilities:
Total current liabilities $ -
Commitments and contingencies (Note 3) -
Stockholders' equity:
Preferred stock, $.001 par value,
1,000,000 shares authorized, no shares
issued and outstanding -
Common stock, $.001 par value,
49,000,000 shares authorized, 14,400,000
shares issued and outstanding 14,400
Additional paid in capital 34,850
(Deficit) accumulated during
development stage (29,830)
----------
19,420
---------
$ 19,420
See accompanying notes to financial statements.
26
Wahoo Capital Ventures, Inc.
(A Development Stage Company)
Statement of Operations
For the Period From Inception (August 3, 1999) to December 31, 1999
Period From
Inception To
December 31,
1999
Operating expenses:
Consulting services paid in stock $ 14,050
Consulting services paid in cash 15,000
Office expenses 780
-----------
Total operating expenses 29,830
-----------
(Loss from operations) and net (loss) $ (29,830)
Per share information:
Basic and diluted (loss) per common share $ (0.00)
Weighted average shares outstanding 14,240,000
See accompanying notes to financial statements.
27
Wahoo Capital Ventures, Inc.
(A Development Stage Company)
Statement of Changes in Stockholders' Equity
For the Period From Inception (August 3, 1999) to December 31, 1999
Deficit
Additional Accumulated
Common Stock Paid-in During Develop-
ACTIVITY Shares Amount Capital ment Stage Total
Shares issued to directors at inception
at $.001 per share 14,050,000 $ 14,050 $ - $ - $ 14,050
Shares issued for cash
November 1999 @ $.10 2,100,000 220 21,780 - 22,000
December 1999 @ $.10 130,000 130 12,870 - 13,000
Capital contribution by officer - - 200 - 200
Net (loss) for the period
ended December 31, 1999 - - - (29,830) (29,830)
---------- ----------- ---------- ------------ -----------
Balance, December 31, 1999 14,400,000 $ 14,400 $ 34,850 $ (29,830) $ 19,420
See accompanying notes to financial statements.
28
Wahoo Capital Ventures, Inc.
(A Development Stage Company)
Statement of Cash Flows
For the Period From Inception (August 3, 1999) to December 31, 1999
Period From
Inception To
December 31,
1999
Net income (loss) $ (29,830)
Adjustments to reconcile net income to net
cash provided by operating activities:
Services provided for stock 14,050
Expenses paid by officer 200
Changes in assets and liabilities:
(Increase) in accounts receivable (3,000)
----------
Total adjustments 11,250
----------
Net cash provided by (used in)
operating activities (18,580)
Cash flows from financing activities:
Common stock sold for cash 35,000
---------
Net cash provided by (used in)
financing activities 35,000
---------
Increase (decrease) in cash 16,420
Cash and cash equivalents,
beginning of period -
--------
Cash and cash equivalents,
end of period $ 16,420
See accompanying notes to financial statements.
29
Wahoo Capital Ventures, Inc.
(A Development Stage Company)
Statement of Cash Flows
For the Period From Inception (August 3, 1999) to December 31, 1999
Period From
Inception To
December 31,
1999
Supplemental cash flow information:
Cash paid for interest $ -
Cash paid for income taxes $ -
See accompanying notes to financial statements.
30
Wahoo Capital Ventures, Inc.
Notes to Financial Statements
December 31, 1999
Note 1. Organization and Summary of Significant Accounting Policies.
The Company was incorporated in Nevada on August 3, 1999. The
Company's activities to date have been limited to organization and
capital formation. The Company has not chosen its principal business
activity.
Loss per share:
Basic Earnings per Share ("EPS") is computed by dividing net income
available to common stockholders by the weighted average number of
common stock shares outstanding during the year. Diluted EPS is
computed by dividing net income available to common stockholders by
the weighted-average number of common stock shares outstanding during
the year plus potential dilutive instruments such as stock options
and warrants. The effect of stock options on diluted EPS is
determined through the application of the treasury stock method,
whereby proceeds received by the Company based on assumed exercises
are hypothetically used to repurchase the Company's common stock at
the average market price during the period. Loss per share is
unchanged on a diluted basis since the assumed exercise of common stock
equivalents would have an anti-dilutive effect.
Cash:
For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with maturity of three months or
less to be cash equivalents.
Estimates:
The preparation of the Company's financial statements requires management
to make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ
from these estimates
Fair value of financial instruments
The Company's short-term financial instruments consist of cash and cash
equivalents and accounts payable. The carrying amounts of these financial
instruments approximate fair value because of their short-term maturities.
Financial instruments that potentially subject the Company to a
concentration of credit risk consist principally of cash. During the year
the Company did not maintain cash deposits at financial institutions in
excess of the $100,000 limit covered by the Federal Deposit Insurance
Corporation. The Company does not hold or issue financial instruments for
trading purposes nor does it hold or issue interest rate or leveraged
derivative financial instruments
Stock-based Compensation
The Company adopted Statement of Financial Accounting Standard No. 123 (FAS
123), Accounting for Stock-Based Compensation beginning with the Company's
first quarter of 1996. Upon adoption of FAS 123, the Company continued to
measure compensation expense for its stock-based employee compensation
plans using the intrinsic value method prescribed by APB No. 25, Accounting
for Stock Issued to Employees. Stock based compensation paid by the
Company during the period ended December 31, 1999 is disclosed in Note 2.
New Accounting Pronouncements
SFAS No. 130, "Reporting Comprehensive Income", establishes guidelines
for all items that are to be recognized under accounting standards as
components of comprehensive income to be reported in the financial
statements. The statement is effective for all periods beginning after
December 15, 1997 and reclassification financial statements for earlier
periods will be required for comparative purposes. To date, the
Company has not engaged in transactions that would result in any
significant difference between its reported net loss and comprehensive
net loss as defined in the statement.
In March 1998, the American Institute of Certified Public Accountants
issued Statement of Position 98-1, Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use ("SOP 98-
31
1"). SOP 98-1 provides authoritative guidance on when internal-use
software costs should be capitalized and when these costs should be
expensed as incurred.
Effective in 1998, the Company adopted SOP 98-1, however the Company
has not incurred costs to date that would require evaluation in
accordance with the SOP.
Effective December 31, 1998, the Company adopted SFAS No. 131,
Disclosures about Segments of an Enterprise and Related Information
("SFAS 131"). SFAS 131 superseded SFAS No. 14, Financial Reporting
for Segments of a Business Enterprise. SFAS 131 establishes standards
for the way that public business enterprises report information about
operating segments in annual financial statements and requires that
those enterprises report selected information about operating
segments in interim financial reports. SFAS 131 also establishes
standards for related disclosures about products and services,
geographic areas, and major customers. The adoption of SFAS 131 did
not affect results of operations or financial position. To date, the
Company has not operated in any planned business activity.
Effective December 31, 1998, the Company adopted the provisions of
SFAS No. 132, Employers' Disclosures about Pensions and Other Post-
retirement Benefits ("SFAS 132"). SFAS 132 supersedes the disclosure
requirements in SFAS No. 87, Employers' Accounting for Pensions, and
SFAS No. 106, Employers' Accounting for Post-retirement Benefits
Other Than Pensions. The overall objective of SFAS 132 is to improve
and standardize disclosures about pensions and other post-retirement
benefits and to make the required information more understandable.
The adoption of SFAS 132 did not affect results of operations or
financial position.
The Company has not initiated benefit plans to date that would
require disclosure under the statement.
In June 1998, the Financial Accounting Standards Board issued SFAS
No. 133, Accounting for Derivative Instruments and Hedging Activities
("SFAS 133"), which is required to be adopted in years beginning
after June 15, 1999. SFAS 133 will require the Company to recognize
all derivatives on the balance sheet at fair value. Derivatives that
are not hedges must be adjusted to fair value through income. If the
derivative is a hedge, depending on the nature of the hedge, changes
in the fair value of derivatives will either be offset against the
change in fair value of hedged assets, liabilities, or firm
commitments through earnings or recognized in other comprehensive
income until the hedged item is recognized in earnings. The
ineffective portion of a derivative's change in fair value will be
immediately recognized in earnings. The Company has not yet
determined what the effect of SFAS 133 will be on earnings and the
financial position of the Company, however it believes that it has
not to date engaged in significant transactions encompassed by the
statement.
During 1998, the American Institute of Certified Public Accountants
issued Statement of Position 98-5 - Reporting on the Costs of Start-
Up Activities. The statement is effective for fiscal years beginning
after December 15, 1998 and requires that the cost of start-up
activities, including organization costs be expensed as incurred.
The Company adopted the statement upon its inception.
Note 2. Stockholders' Equity.
At inception, the Company issued 14,050,000 shares of it's restricted
common stock to five individuals who became its directors and/or
officers in exchange for their services in forming the Company. The
shares were valued at $.001 per share ($14,050) which the Company
believes represents the fair value of the services performed by the
officers.
During November and December 1999, the Company issued an aggregate of
350,000 shares of its common stock to a limited group of investors
for cash aggregating $35,000 in private sale transactions. The
shares were sold at a price of $.10 per share in a unit offering.
The units consist of two shares Common Stock, one class A warrant
exercisable at $.50 for a period of three years from the close of the
offering, one class B warrant exercisable at $.75 for a period of
32
three years from the close of the offering, and ten class C warrants
exercisable at $4.00 for a period of five years from the close of the
offering. All warrants are callable for $.01 with 30 days notice.
Additionally, an officer provides office services to the Company that
were valued at $200 for the year ended December 31, 1999. The officer
does not expect repayment of the expenses paid and the Company has
recorded the expenses as a contribution to its capital by the
officer.
Note 3. Commitments and contingencies
The Company neither owns nor leases any real or personal property other
than as described in Note 2. An officer of the Company provides office
services and the costs thereof are included in administrative expenses.
The fair value of such costs have been estimated to be approximately $50
per month and have been reflected in the accompanying financial
statements.
The officers and directors of the Company are involved in other business
activities and may become involved in other business activities in the
future. Such business activities may conflict with the activities of
the Company. The Company has not formulated a policy for the resolution
of any such conflicts that may arise.
Note 4. Income Taxes
Deferred income taxes may arise from temporary differences
resulting from income and expense items reported for financial
accounting and tax purposes in different periods. Deferred taxes
are classified as current or non-current, depending on the
classifications of the assets and liabilities to which they relate.
Deferred taxes arising from temporary differences that are not
related to an asset or liability are classified as current or non-
current depending on the periods in which the temporary differences
are expected to reverse. The Company had no significant deferred
tax items arise during any of the periods presented.
The Company has not provided for income taxes during the period
ended December 31, 1999 as a result of an operating loss. The
Company has a net operating loss carryforward at December 31, 1999
of approximately $30,000. The Company has fully reserved the
deferred tax asset (approximately $4,500) that would arise from the
loss carryforward since the Company cannot predict a level of
operations that would assure the utilization of the loss in future
periods.
Note 5. Subsequent Events
During January 2000, the Company sold an additional 40,000 shares of its
common under terms identical to those described in Note 2. for gross
proceeds of $4,000. Additionally in January 2000, the Company collected
$3,000 in cash from the sale of its common stock in December 1999.
33
PART II
INFORMATION NOT REQUIRED BY PROSPECTUS
Item 24. Indemnification of Officers and Directors.
The By-Laws of Wahoo provides that a director of the registrant
shall have no personal liability to the Registrant or its stockholders
for monetary damages for breach of a fiduciary duty as a director,
except for liability (a) for any breach of the director's duty of
loyalty to the Registrant or its stockholders, (b) for acts and
omissions not in good faith or which involve intentional misconduct or
a knowing violation of law, and (c) pursuant to Nevada law for any
transaction from which the director derived an improper personal
benefit. Registrant's By-Laws exculpates and indemnifies the
directors, officers, employees, and agents of the registrant from and
against liabilities. Further the By-Laws also provides that the
Registrant shall indemnify to the full extent permitted under Nevada
law any director, officer employee or agent of Registrant who has
served as a director, officer, employee or agent or the Registrant or,
at the Registrant's request, has served as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise.
INDEMNIFICATION OF OFFICERS OR PERSONS CONTROLLING THE COMPANY FOR
LIABILITIES ARISING UNDER THE SECURITIES ACT OF 1933, IS HELD TO BE
AGAINST PUBLIC POLICY BY THE SECURITIES AND EXCHANGE COMMISSION AND IS
THEREFORE UNENFORCEABLE.
Item 25. Other Expenses of Issuance and Distribution.
Other expenses in connection with this offering which will be paid by
Wahoo are estimated to be substantially as follows:
Amount
Payable
Item By Company
S.E.C. Registration Fees $4,643.16
Printing and Engraving Fees 7,500.00
Legal Fees 20,000.00
Accounting Fees and Expenses 5,000.00
Miscellaneous 2,500.00
Total $39,643.16
The selling security holders will not pay any expenses in connection
with the offering.
Item 26. Recent Sales of Unregistered Securities.
At inception, Wahoo issued 14,900,000 shares of it's restricted
common stock to five individuals who became its directors and/or
officers in exchange for their services in forming Wahoo. The
shares were valued at par value.
Colin Moody 4,400,000
Dale Benson 4,400,000
Joanne Murphy 4,400,000
Timothy Miles 650,000
Joel R. Shine 200,000
These issuances were made to sophisticated individuals pursuant to an
exemption from registration under Sec. 4(2) of the Securities Act of
1933.
During November 1999, December 1999 and January 2000, Wahoo issued an
aggregate of 390,000 units to a limited group of investors for cash
aggregating $39,000 in private sale transactions. The units were sold
at a price of $.10 per unit in a unit offering.
The units consist of two shares common stock, one class A warrant
exercisable at $.50 for a period of three years from the close of the
offering, one class B warrant exercisable at $.75 for a period of
three years from the close of the offering, and four class C warrants
exercisable at $4.00 for a period of five years from the close of the
offering. All warrants are callable for $.01 with 30 days notice.
34
Name Units
Colin Moody 10,000
Dale Benson 10,000
Joanne Murphy 10,000
Timothy Miles 650,000
Joel R. Shine 200,000
Kevin Tatsugawa 10,000
John Wong 10,000
Patrick Gundlach 10,000
Tom Geise 10,000
Raymond Uno 10,000
Michael T. Hinchey 10,000
Paul Spiegler 10,000
Erich Schmid 10,000
Gary R. See 10,000
Cassia L. Miles and
Ronda Shaheen 10,000
Abigail Miles 10,000
James Yanai 10,000
John Poli 10,000
Elizabeth Gheen 10,000
Paul M. Kasden 10,000
Dean Cummings 10,000
Mary Ann Lang 10,000
James Potter 20,000
Beryl Salerno 10,000
Kazu Fujita 10,000
William R. Shine 10,000
Robert Ichikawa 10,000
Gary Kihs 10,000
Robert Watson 10,000
Thomas Bass 10,000
Kevin Robinson 10,000
Subrina Hamasaki 10,000
Mitsuo Tatsugawa 10,000
Derek and Chandra Cholakian 10,000
Scott Thompson and
Christina Lindquist JT 10,000
Dale R. Benson 10,000
Curtis Spackman 10,000
Fred Norman Quadros Jr. Trust 10,000
Karen Fellbaum 10,000
Nancy Jewell 10,000
Christopher B. Larkby 10,000
Christopher Lackman 10,000
R.E. Hunt 10,000
Wahoo shall register pursuant to this prospectus 780,000 common shares
underlying A warrants currently outstanding for the account of the
following individuals or entities. The percentage owned prior to and
after the offering reflects all of the then outstanding warrants. The
amount and percentage owned after the offering assumes the exercise and
sale of all of the common shares underlying the A warrants being
registered on behalf of the selling security holders.
Name Units
Kevin Tatsugawa 5,000
John Wong 5,000
Patrick Gundlach 5,000
Tom Geise 5,000
Raymond Uno 5,000
Michael T. Hinchey 5,000
Paul Spiegler 5,000
Erich Schmid 5,000
Gary R. See 5,000
Cassia L. Miles and
Ronda Shaheen 5,000
Abigail Miles 5,000
James Yanai 5,000
John Poli 5,000
Elizabeth Gheen 5,000
Paul M. Kasden 5,000
Dean Cummings 5,000
Mary Ann Lang 5,000
James Potter 5,000
Beryl Salerno 5,000
35
Kazu Fujita 5,000
William R. Shine 5,000
Robert Ichikawa 5,000
Gary Kihs 5,000
Robert Watson 5,000
Thomas Bass 5,000
Kevin Robinson 5,000
Subrina Hamasaki 5,000
Mitsuo Tatsugawa 5,000
Derek and Chandra Cholakian 5,000
Scott Thompson and
Christina Lindquist JT 5,000
Dale R. Benson 5,000
Curtis Spackman 5,000
Fred Norman Quadros Jr. Trust 5,000
Karen Fellbaum 5,000
Nancy Jewell 5,000
Christopher B. Larkby 5,000
Christopher Lackman 5,000
R.E. Hunt 5,000
These sales were made pursuant to an exemption from registration
pursuant to Section 505 of Regulation D. All sales were made to all
accredited investors. No general solicitation was utilized. The
offering was approved and/or exempted by the required states and the
appropriate Form D was filed with the Securities and Exchange
Commission.
Item 27. Exhibit Index.
(1) Not Applicable
(2) Not Applicable
(3) Articles of Incorporation dated August 3, 1999
(3.1) Amendment to Articles
(3.2) Bylaws
(4) Specimen certificate for common stock
(4.1) Specimen certificate for warrants
(5) Consent and Opinion of Jody M. Walker regarding
legality of securities registered under this
Registration Statement and to the
references to such attorney in the prospectus filed
as part of this Registration Statement
(6) Not Applicable
(7) Not Applicable
(8) Not Applicable
(9) Not Applicable
(10) Not Applicable
(11) Not Applicable
(12) Not Applicable
(13) Not Applicable
(14) Not Applicable
(15) Not Applicable
(16) Not Applicable
(17) Not Applicable
(18) Not Applicable
(19) Not Applicable
(20) Not Applicable
(21) Not Applicable
(22) Not Applicable
(23) Not Applicable
(24) Consent of James E. Scheifley & Associates, P.C.
(25) Not Applicable
(26) Not Applicable
(27) Financial Data Schedule
(28) Not Applicable
Item 28. Undertaking.
The undersigned registrant hereby undertakes:
(a)(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;
36
(ii) To reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information 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 form 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, , the changes in ovlume 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 on the
plan of distribution.
(2) That, for the purpose of determining any liability under the
Securities Act, we shall treat each such post-effective amendment as a
new registration statement of the securities offered, and the offering
of the securities at that time shall be deemed to be the initial bona
fide offering.
(3) To file a post-effective amendment to remove from registration any
of the securities that remain unsold at the end of the offering.
(b) to supplement the prospectus, after the end of the subscription
period, to include the results of the subscription offer, the
transactions by the underwriters during the subscription period, the
amount of unsubscribed securities that the underwriters will purchase
and the terms of any later reoffering. If the underwriters make any
public offering of the securities on terms different from those on the
cover page of the prospecuts, we shall file a post-effective amendment
to state the terms of such offering.
(c) Not applicable.
(d) to provide to the underwriter at the closing specified in the
underwriting agreement certificates in such denominations and
registered in such names as required by the underwriter to premit
prompt delivery to each purchaser.
(e) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the small business issuer pursuant to the
foregoing provisions, or otherwise, the small business issuer has been
advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable.
37
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements of filing on Form SB-2 and authorized
this registration statement to be signed on its behalf by the
undersigned, in the City of San Jose, State of California on the 12th
day of March, 2000.
Wahoo Capital Ventures, Inc.
/s/Colin Moody
---------------------------
By: Colin Moody, President
In accordance with the requirements of the Securities Act of 1933, this
registration statement was signed by the following persons in the
capacities and on the dates stated.
Signature Capacity Date
/s/Colin Moody, Principal Executive Officer March 12, 2000
- --------------- Principal Financial Officer, Controller
Colin Moody
/s/ Dale Benson Director March 12, 2000
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Dale Benson
/s/Joanne Murphy Director March 12, 2000
- ---------------------
Joanne Murphy