U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ECONNECT, INC.
(Exact Name of Registrant as Specified in its Charter)
Nevada 43-1239043
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(State of Incorporation) (I.R.S. Employer ID No.)
1010 N. Central Ave., Glendale, California 91202
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(Address of principal executive offices) (Zip Code)
Consulting Agreements dated September 10, 2002; and
2003 Special Stock Option Plan dated January 2, 2003
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(Full title of the Plan)
William B. Haseltine, Attorney at Law
604 North Greenbrier Street, Arlington, Virginia 22203
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(Name and address of agent for service)
(703) 276-1919
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
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Title of Securities to Amount to be Proposed Maximum Proposed Aggregate Amount of
be Registered Registered Offering Price Per Offering Price Registration Fee
Share
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Common Stock 118,303,528 $0.006 (1) $709,821 $65.30
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(1) Computed pursuant to Rule 457(c) on the basis of the average of the high and
low prices per share as reported for such securities on the NASD's OTC Bulletin
Board on January 10, 2003.
Pursuant to General Instruction E to Form S-8, the contents of an
earlier registration statement filed on this Form S-8, No. 333-74524, are hereby
incorporated by reference. The Consulting Agreement filed as an exhibit with the
S-8, No. 333-87438, filed on May 2, 2002, is incorporated by reference herein.
The Consulting Agreement that is incorporated by reference herein is
the same as that which is between the Company and the following individuals for
the amount of shares indicated. These individuals are involved in development of
the businesses of the Company in the area of support for financial, legal,
operational and marketing assistance, and for the development and establishment
of retail contacts: William Haseltine 7,103,528 ; Gilbert Serrano 5.5 million;
Allen Treffry 4.5 million; Don Yarter 3.0 million; Chris Jensen 5.5 million;
Quinn Brady 1.5 million; Roger Swanson 1.5 million ; John Hogel 3.0 million; Bob
Atwell 3.0 million; Peter Jensen 2.2 million; Chris Payne 4.0 million; Diedra
Girardeau 3.0 million; Griselle Colon 3.0 million; John Fishbein 1.0 million;
Julie Saxton 4.5 million; Steve Strobell 3.0 million; Darrell Dixon 500,000;
Wayne Hall 2.0 million; Shone Clark 1.3 million; Erin Lovejoy 1.0 million; Shari
Coffin 1.0 million; Vijay Ragavan 1.0 million; Jack Hall 1.0 million; Teawz
Abdur-Raheem 500,000; Aaron Atkinson 4.0 million; Cathy Rangel 1.0 million; Rex
Burnett 3.0 million; Matt Crawford 2.0 million; Jeff Leichter 1.0 million;
Natalya R. Davis 3.0 million; Jenisha E. Cartagena 3.0 million; Allyson Penn 3.0
million; Jim Clinton 1.0 million Daniel H. Fried 3.0 million.
Information regarding the Non-qualified Option Agreement is set forth
below.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information*
Item 2. Registrant Information and Employee Plan Annual Information*
*Information required by Part I to be contained in the Section 10(a) prospectus
is omitted from this Registration Statement in accordance with Rule 428 under
the Securities Act of 1933 (the "Securities Act"), and the Note to Part I of
Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed by eConnect, Inc. (the "Registrant") with the
Securities and Exchange Commission (the "Commission") are hereby incorporated by
reference in this Registration Statement:
a. The audited consolidated financial statements of the
Registrant contained in the Registrant's Annual Report on Form
10-KSB, for the period ending December 31, 2001, filed on
April 16, 2002 by the Registrant under Section 15(d) of
Securities Exchange Act of 1934 (the "Exchange Act").
b. The Registrant's Quarterly Reports on Form 10-QSB for the
Quarterly Periods ended March 31, 2002, June 30, 2002 and
September 30, 2002 (File No 33-68570).
In addition, all documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act"), prior to the filing of a post-effective amendment indicating
that all of the securities offered hereunder have been sold or de-registering
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be part hereof from the date of
filing of such documents. Any statement contained in a document incorporated or
deemed to be incorporated by reference in this Registration Statement shall be
deemed to be modified or superseded for purposes of this Registration Statement
to the extent that a statement contained herein or in any subsequently filed
document that also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Registration Statement.
Item 4. Description of Securities.
The Registrant's common stock is subject to the reporting requirements of the
Securities Exchange Act of 1934. The Registrant currently has 139,437,059 shares
of common stock issued and outstanding as of January 13, 2003. Holders of the
Company's common stock are entitled to one vote per share on each matter
submitted to vote at any meeting of shareholders. Shares of common stock do not
carry cumulative voting rights and therefore, holders of a majority of the
outstanding shares of common stock will be able to elect the entire board of
directors and, if they do so, minority shareholders would not be able to elect
any members to the board of directors. The Company's board of directors has
authority, without action by the Company's shareholders, to issue all or any
portion of the authorized but unissued shares of common stock, which would
reduce the percentage ownership of the Company of its shareholders and which
would dilute the book value of the common stock.
Shareholders of the Company have no preemptive rights to acquire additional
shares of common stock. The common stock is not subject to redemption and
carries no subscription or conversion rights. In the event of liquidation of the
Company, the shares of common stock are entitled to share equally in corporate
assets after the satisfaction of all liabilities. Holders of common stock are
entitled to receive such dividends as the board of directors may from time to
time declare out of funds legally available for the payment of dividends. During
the last two fiscal years the Company has not paid cash dividends on its common
stock and does not anticipate that it will pay cash dividends in the foreseeable
future.
Item 6. Indemnification of Directors and Officers
Limitation of Liability.
The articles of incorporation of the company provide that no Director
or Officer of this company shall be liable to the company or its stockholders
for any breach of fiduciary duty as Officer or Director of this company. This
provision shall not affect liability for acts or omissions which involve
intentional misconduct, fraud, a knowing violation or law, or the payment of
dividends in violation of NRS 78.300.
Indemnification.
* Articles of Incorporation.
The articles of incorporation of the company provide that all expenses
incurred by officers or directors in defending a civil or criminal action, suit,
or proceeding, must be paid by this company as they are incurred in advance of a
final disposition of the action, suit or proceeding, upon receipt of an
undertaking by or on behalf of a director or officer to repay the amount if it
is ultimately determined by a court of competent jurisdiction, that he or she
did not act in good faith, and in the manner he or she reasonably believed to be
or not opposed to the best interests of the company.
* Bylaws.
The bylaws of the company provide the following with respect to
indemnification:
Each indemnitee of the company shall be indemnified and held harmless
by the company for all actions taken by him or her, and for all omissions
(regardless of the date of any such action or omission), to the fullest extent
permitted by Nevada law, against all expense, liability and loss (including,
without limitation, attorney fees, judgments, fines, taxes, penalties, and
amounts paid or to be paid in settlement) reasonably incurred or suffered by the
Indemnitee in connection with any proceeding. Indemnification pursuant to this
section shall continue as to an indemnitee who has ceased to be a director or
officer and shall inure to the benefit of his or her heirs, executors and
administrators. The company may, by action of its board of directors, and to the
extent provided in such action, indemnify employees and other persons as though
they were indemnitees. The rights to indemnification as provided shall be
non-exclusive of any other rights that any person may have or hereafter acquire
under an statute, provision of the company's articles of incorporation or
bylaws, agreement, vote of stockholders or directors, or otherwise.
The company may purchase and maintain insurance or make other
financial arrangements on behalf of any person who is or was a director,
officer, employee or agent of the company, or is or was serving at the request
of the company in such capacity for another corporation, partnership, joint
venture, trust or other enterprise for any liability asserted against him or her
and liability and expenses incurred by him or her in such capacity, whether or
not the company has the authority to indemnify him or her against such liability
and expenses.
The other financial arrangements which may be made by the company may
include, but are not limited to, (a) creating a trust fund; (b) establishing a
program of self-insurance; (c) securing its obligation of indemnification by
granting a security interest or other lien on any of the company's assets, and
(d) establishing a letter of credit, guarantee or surety. No financial
arrangement made pursuant to this section may provide protection for a person
adjudged by a court of competent jurisdiction, after exhaustion of all appeals
therefrom, to be liable for intentional misconduct, fraud, or a knowing
violation of law, except with respect to advancing expenses or indemnification
ordered by a court. Any insurance or other financial arrangement made on behalf
of a person pursuant to this section may be provided by the company or any other
person approved by the board of directors, even if all or part of the other
person's stock or other securities is owned by the company. In the absence of
fraud:
. the decision of the board of directors as to the propriety of the
terms and conditions of any insurance or other financial arrangement
made pursuant to this section, and the choice of the person to provide
the insurance or other financial arrangement is conclusive; and
. the insurance or other financial arrangement is not void or voidable;
does not subject any director approving it to personal liability for
his action; and even if a director approving the insurance or other
financial arrangement is a beneficiary of the insurance or other
financial arrangement.
* Nevada Revised Statutes.
. NRS 78.7502 Discretionary and mandatory indemnification of officers,
directors, employees and agents: General provisions.
(1) A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact
that he is or was a director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses, including attorneys' fees, judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted in good faith and in
a manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent, does not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and that, with respect to any criminal action or
proceeding, he had reasonable cause to believe that his conduct was unlawful.
(2) A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses, including amounts paid in
settlement and attorneys' fees actually and reasonably incurred by him in
connection with the defense or settlement of the action or suit if he acted in
good faith and in a manner which he reasonably believed to be in or not opposed
to the best interests of the corporation. Indemnification may not be made for
any claim, issue or matter as to which such a person has been adjudged by a
court of competent jurisdiction, after exhaustion of all appeals therefrom, to
be liable to the corporation or for amounts paid in settlement to the
corporation, unless and only to the extent that the court in which the action or
suit was brought or other court of competent jurisdiction determines upon
application that in view of all the circumstances of the case, the person is
fairly and reasonably entitled to indemnity for such expenses as the court deems
proper.
(3) To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections 1 and 2, or in defense of
any claim, issue or matter therein, the corporation shall indemnify him against
expenses, including attorneys' fees, actually and reasonably incurred by him in
connection with the defense.
. NRS 78.751 Authorization required for discretionary indemnification;
advancement of expenses; limitation on indemnification and advancement
of expenses.
(1) Any discretionary indemnification under NRS 78.7502 unless
ordered by a court or advanced pursuant to subsection 2, may be made by the
corporation only as authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is proper in the
circumstances. The determination must be made:
(i) By the stockholders;
(ii) By the board of directors by majority vote of a quorum consisting
of directors who were not parties to the action, suit or proceeding;
(iii) If a majority vote of a quorum consisting of directors who were
not parties to the action, suit or proceeding so orders, by
independent legal counsel in a written opinion; or
(iv) If a quorum consisting of directors who were not parties to the
action, suit or proceeding cannot be obtained, by independent legal
counsel in a written opinion.
(2) The articles of incorporation, the bylaws or an agreement made by
the corporation may provide that the expenses of officers and
directors incurred in defending a civil or criminal action, suit or
proceeding must be paid by the corporation as they are incurred and in
advance of the final disposition of the action, suit or proceeding,
upon receipt of an undertaking by or on behalf of the director or
officer to repay the amount if it is ultimately determined by a court
of competent jurisdiction that he is not entitled to be indemnified by
the corporation. The provisions of this subsection do not affect any
rights to advancement of expenses to which corporate personnel other
than directors or officers may be entitled under any contract or
otherwise by law.
(3) The indemnification and advancement of expenses authorized in NRS
78.7502 or ordered by a court pursuant to this section:
(i) Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under the
articles of incorporation or any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, for either an
action in his official capacity or an action in another capacity while
holding his office, except that indemnification, unless ordered by a
court pursuant to or for the advancement of expenses made pursuant to
subsection 2, may not be made to or on behalf of any director or
officer if a final adjudication establishes that his acts or omissions
involved intentional misconduct, fraud or a knowing violation of the
law and were material to the cause of action.
(ii) Continues for a person who has ceased to be a director, officer,
employee or agent and inures to the benefit of the heirs, executors
and administrators of such a person.
. NRS 78.752 Insurance and other financial arrangements against
liability of directors, officers, employees and agents.
(1) A corporation may purchase and maintain insurance or make other
financial arrangements on behalf of any person who is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture,
trust or other enterprise for any liability asserted against him and
liability and expenses incurred by him in his capacity as a director,
officer, employee or agent, or arising out of his status as such,
whether or not the corporation has the authority to indemnify him
against such liability and expenses.
(2) The other financial arrangements made by the corporation pursuant
to subsection 1 may include the following:
(i) The creation of a trust fund.
(ii) The establishment of a program of self-insurance.
(iii) The securing of its obligation of indemnification by granting a
security interest or other lien on any assets of the corporation.
(iv) The establishment of a letter of credit, guaranty or surety.
No financial arrangement made pursuant to this subsection may provide protection
for a person adjudged by a court of competent jurisdiction, after exhaustion of
all appeals therefrom, to be liable for intentional misconduct, fraud or a
knowing violation of law, except with respect to the advancement of expenses or
indemnification ordered by a court.
(3) Any insurance or other financial arrangement made on behalf of a
person pursuant to this section may be provided by the corporation or
any other person approved by the board of directors, even if all or
part of the other person's stock or other securities is owned by the
corporation.
(4) In the absence of fraud:
(i) The decision of the board of directors as to the propriety of the
terms and conditions of any insurance or other financial arrangement
made pursuant to this section and the choice of the person to provide
the insurance or other financial arrangement is conclusive; and
(ii) The insurance or other financial arrangement:
(A) Is not void or voidable; and
(B) Does not subject any director approving it to personal
liability for his action, even if a director approving the
insurance or other financial arrangement is a beneficiary of the
insurance or other financial arrangement.
(5) A corporation or its subsidiary which provides self-insurance for
itself or for another affiliated corporation pursuant to this section is not
subject to the provisions of Title 57 of NRS."
Undertaking.
The company undertakes the following:
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") 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 U.S. Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable.
Item 8. Exhibits
Exhibit Number Description
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5.1 Opinion of William B. Haseltine, Esq.
23.1 Consent of William B. Haseltine, Esq (included in Exhibit
5.1 to this Registration Statement)
23.2 Consent of L.L. Bradford, LLC
99.1 2003 Special Stock Option Plan
Item 9. Undertakings
a. The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
i. To include any prospectus required by Section
10(a)(3) of the Securities Act;
ii. To reflect in the prospectus any facts or event
arising out of the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set for the in the Registration
Statement;
iii. To include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required
to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed
with or furnished to the Commission by the Registrant
pursuant to Seciton 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in
the Registration Statement; and
iv. That, for the purpose of determining any liability
under the Securities Act, each such post-effective
amendment shall be deemed to be a new registration
statement relating to the securities offered therein,
and the offering of such securities at that time
shall be deemed to be the initial bona fide offering
thereof.
2. To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is
incorporated by reference in the Registration Statement shall be deemed to be a
new Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the Registrant in the
successful defencse of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Glendale, California on the 13th day of January,
2003.
ECONNECT, INC.
(Registrant)
/s/ Christopher A. Jenson
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By: Christopher A. Jenson
Title: Chief Executive Officer