Registration of Securities of a Small-Business Issuer — Form 10-SB Filing Table of Contents
Document/ExhibitDescriptionPagesSize 1: 10SB12G Vtdi 10-Sb12G (12-14-07) HTML 339K
2: EX-2.1 Plan of Acquisition, Reorganization, Arrangement, HTML 12K
Liquidation or Succession
3: EX-2.2 Plan of Acquisition, Reorganization, Arrangement, HTML 6K
Liquidation or Succession
4: EX-2.3 Plan of Acquisition, Reorganization, Arrangement, HTML 71K
Liquidation or Succession
5: EX-10.1 Material Contract HTML 6K
This
registration statement contains
forward-looking statements. In addition, from time to time, we or our
representatives may make forward-looking statements orally or in
writing. These are statements that relate to future periods and
include statements regarding our future strategic, operational and financial
plans, potential acquisitions, anticipated or projected revenues, expenses
and
operational growth, markets and potential customers for our products and
services, plans related to sales strategies and efforts, the anticipated
benefits of our relationships with strategic partners, growth of our
competition, our ability to compete, the adequacy of our current facilities
and
our ability to obtain additional space, use of future earnings, and the feature,
benefits and performance of our current and future products and
services.
You
can identify forward-looking
statements by those that are not historical in nature, particularly those that
use terminology such as “may,”“will,”“should,”“expects,”“anticipates,”“contemplates,”“estimates,”“believes,”“plans,”“projected,”“predicts,”“potential,”“seek” or “continue” or the negative of these or similar
terms. In evaluating these forward-looking statements, you should
consider various factors, including those described in this registration
statement under the heading “Risk Factors” beginning on page 4. These and other
factors may cause our actual results to differ materially from any
forward-looking statement. We caution you not to place undue reliance
on these forward-looking statements.
We
base these forward-looking
statements on our expectations and projections about future events, which we
derive from the information currently available to us. Such
forward-looking statements relate to future events or our future
performance. Forward-looking statements are only
predictions. The forward-looking events discussed in this
registration statement, the documents to which we refer you and other statements
made from time to time by us or our representatives, may not occur, and actual
events and results may differ materially and are subject to risks, uncertainties
and assumptions about us. For these statements, we claim the
protection of the “bespeaks caution” doctrine. The forward-looking
statements speak only as of the date hereof, and we expressly disclaim any
obligation to publicly release the results of any revisions to these
forward-looking statements to reflect events or circumstances after the date
of
this filing.
Factors
that may affect forward-looking statements. A wide
range of factors could materially affect future developments and performance
of
our business. This registration statement describes significant
factors affecting specific business operations and the financial results of
these operations. General factors affecting our operations
include:
•
Changes
in business plans
•
Changes
in U.S., global or regional economic conditions
•
Changes in U.S. and global financial and equity markets, including market
disruptions and significant interest rate fluctuations
•
Increased competitive pressures
•
Legal
developments that may affect our business
•
Technological developments that may affect our business
•
Changes
in government regulations relating to the oil and gas industry
This
list
of factors that may affect future performance and the accuracy of
forward-looking statements are illustrative, but by no means exhaustive.
Accordingly, all forward-looking statements should be evaluated with the
understanding of their inherent uncertainty.
PART
I
ITEM
1. RISK
FACTORS
An
investment in our common stock involves a high degree of risk. You
should carefully consider the following risk factors and the other information
in this registration statement before investing in our common
stock. Our business and results of operations could be seriously
harmed by any of the following risks. The trading price of our common
stock could decline due to any of these risks.
Risks
Related to Our Industry
The
industry in which we operate and the market for our services is characterized
by
rapid technological developments, evolving industry standards, and frequent
new
product and service introductions and enhancements.
The
industry in which we operate and
the market for our services is characterized by rapid technological
developments, evolving industry standards, and frequent new product and service
introductions and enhancements. The development and introduction of new products
and services could render our existing services unmarketable. Our business
depends in significant part on our ability to continually improve the
performance, features, and reliability of our motorcycle parts and accessories
and to modify our manufacturing operations to work with new technological
standards in response to both evolving demand in the marketplace and competitive
products and services. Our pursuit of improved performance, new
features, and necessary technological advances will require substantial time
and
expense, and there can be no assurance that we will succeed in adapting our
products to changing technology standards and customer
requirements.
Our
net sales could decrease if our online security measures
fail.
Our
relationships with our customers
may be adversely affected if the security measures that we use to protect their
personal information, such as credit card numbers, are ineffective. If, as
a
result, we lose many customers, our net sales could decrease. We rely on
security and authentication technology that we license from third parties.
With
this technology, we perform real-time credit card authorization and verification
with our bank. We cannot predict whether events or developments will result
in a
compromise or breach of the technology we use to protect a customer's personal
information.
Furthermore,
our servers may be
vulnerable to computer viruses, physical or electronic break-ins, denial of
service attacks and similar disruptions. We may need to expend significant
additional capital and other resources to protect against a security breach
or
to alleviate problems caused by any breaches. We cannot assure that we can
prevent all security breaches.
Our
net sales and gross margins would decrease if we experience significant credit
card fraud.
A
failure to adequately control
fraudulent credit card transactions would reduce our net sales and our gross
margins because we do not carry insurance against this risk. We have developed
technology to help us to detect the fraudulent use of credit card information.
Nonetheless, to date, we have suffered losses as a result of orders placed
with
fraudulent credit card data even though the associated financial institution
approved payment of the orders. Under current credit card practices, we are
liable for fraudulent credit card transactions because we do not obtain a
cardholder's signature.
If
we are unable to maintain our web domain names, our brand and reputation could
be damaged and we could lose customers.
We
may be
unable to maintain our web domain names relating to our brand in the United
States and other countries in which we may conduct business. As a result, we
may
be unable to prevent third parties from acquiring and using domain names
relating to our brand. Such use could damage our brand and reputation and take
customers away from our Web site. The maintenance of domain names generally
is
regulated by governmental agencies and their designees. The regulation of domain
names in the United States and in foreign countries is subject to change in
the
near future. Such changes in the United States are expected to include the
creation of additional top-level domains. Governing bodies may establish
additional top-level domains, appoint additional domain name registrars or
modify the requirements for holding domain names.
A
downturn in the economy may affect consumer purchases of discretionary items
and
could harm our operating results.
In
general, our sales represent
discretionary spending by our customers. Discretionary spending on our products
is affected by many factors, including, among others:
§
general
business conditions;
§
interest
rates;
§
inflation;
§
consumer
debt levels;
§
the
availability of consumer credit;
§
the
number of new and second home
purchases;
§
taxation;
§
energy
prices;
§
unemployment
trends;
§
terrorist
attacks and acts of war; and
§
other
matters that influence consumer confidence and
spending.
Purchases
of discretionary items,
including the products we sell, could decline during periods when disposable
income is lower or during periods of actual or perceived unfavorable economic
conditions. If this occurs, our operating results could suffer.
As
a result of our intensely competitive industry, we may not gain enough market
share to be profitable.
The
motorcycle parts and accessories
market is intensely competitive. We have numerous competitors in the
United States and elsewhere. Because we are pursuing potentially
large markets, our competitors include large companies. Many of these
competitors have greater financial, research and other resources than we
do. If we are unable to compete successfully, we may not be able to
sell enough products at a price sufficient to permit us to generate profits.
Increased competition causing oversupply or depressed prices could materially
adversely affect our revenues.
We
are subject to government regulation.
We,
as a manufacturer of motorcycle
products and accessories, are subject to the National Traffic and Motor Vehicle
Safety Act, which is administered by the National Highway Traffic Safety
Administration (NHTSA). We will have to certify to NHTSA that our motorcycle
products comply fully with all applicable federal motor vehicle safety standards
and related regulations. Although we believe that we are in substantial
compliance with these regulations and currently are implementing a variety
of
measures to promote continuing compliance, we may be required in the future
to
incur expense and/or modify our operations in order to ensure such compliance.
In addition, we cannot predict the nature or effect of any future legislation
or
regulation on our operations.
Our
exposure to product liability claims could harm us
seriously.
Given
the
nature of motorcycle products, we expect we may encounter product liability
claims against us from time to time for personal injury or property damage.
If
such claims become substantial, our brand and reputation would be harmed
seriously. These claims also could require us to pay substantial damage awards,
including punitive damages.
Although
we intend to obtain adequate product liability insurance, we may be unable
to
obtain coverage at a reasonable cost or in a sufficient amount to cover future
losses from product liability claims. Any successful claim against us for
uninsured liabilities or in excess of insured liabilities would most likely
harm
our business seriously.
If
we market and sell our products in international markets, we will be subject
to
additional regulations.
As
a part
of our marketing strategy, we may, in the future, market and sell our products
internationally. In addition to regulation by the U.S. government, our products
will be subject to environmental and safety regulations in each country in
which
we market and sell our motorcycles. Regulations will vary from country to
country and will vary from those of the United States. The difference in
regulations under U.S. law and the laws of foreign countries may be significant
and, in order to comply with the laws of these foreign countries, we may have
to
alter our manufacturing practices, product design or marketing efforts. Any
changes in our business or products required in response to the laws of foreign
countries will result in additional expense to us.
Additionally,
we may be required to obtain certifications or approvals by foreign governments
to market and sell our products in foreign countries. We would also be required
to obtain approval from the U.S. government to export our products. If we are
delayed in receiving, or are unable to obtain, import or export clearances,
or
if we are unable to comply with foreign regulatory requirements, we will be
unable to execute our international marketing strategy for our
products.
Further,
many countries have laws governing marketing of motorcycles and related products
and laws relating to relationships with, and termination of, distributors in
those countries. These laws may make it more difficult for us to promote our
product effectively and in a cost efficient manner. We cannot assure you that
we
will be able to successfully market and sell our products in foreign countries
or that these efforts will result in additional revenue or that any revenue
we
do obtain from the sales of our products in foreign countries will not be offset
by increased regulatory and compliance costs.
Risks
Related to our Stock
Requirements
associated with becoming a public company will require significant company
resources and management attention.
Following
this registration, our goal
is to become a public company. We have not previously been subject to the
reporting requirements of the Securities Exchange Act of 1934, or the other
rules and regulations of the SEC or any securities exchange relating to public
companies. We are working with independent legal, accounting and financial
advisors to identify those areas in which changes should be made to our
financial and management control systems to manage our growth and our
obligations as a public company. These areas include corporate governance,
corporate control, internal audit, disclosure controls and procedures and
financial reporting and accounting systems. We have made, and will continue
to
make, changes in these and other areas, including our internal controls over
financial reporting. However, we cannot assure you that these and other measures
we may take will be sufficient to allow us to satisfy our obligations as a
public company on a timely basis.
In
addition, compliance with reporting
and other requirements applicable to public companies such as Sarbanes Oxley
will create additional costs for us, will require the time and attention of
management and will require the hiring of additional personnel and outside
consultants. We cannot predict or estimate the amount of the additional costs
we
may incur, the timing of such costs or the degree of impact on our management's
attention to these matters will have on our business.
In
addition, being a public company
could make it more difficult or more costly for us to obtain certain types
of
insurance, including directors' and officers' liability insurance, and we may
be
forced to accept reduced policy limits and coverage or incur substantially
higher costs to obtain the same or similar coverage. The impact of these events
could also make it more difficult for us to attract and retain qualified persons
to serve on our board of directors, our board committees or as executive
officers.
We
require substantial capital requirements to finance our
operations.
We
have substantial anticipated capital
requirements. Although we believe we have sufficient capital to fund
current operations, we may require additional capital for future
operations. We plan to finance anticipated ongoing expenses and
capital requirements with funds generated from the following
sources:
§
cash
provided by operating activities;
§
available
cash and cash investments; and
§
capital
raised through debt and equity
offerings.
Although
we believe the funds provided
by these sources will be sufficient to meet our anticipated cash requirements,
the uncertainties and risks associated with future performance and revenues
will
ultimately determine our liquidity and our ability to meet anticipated capital
requirements. If declining prices cause our anticipated revenues to
decrease, we may be limited in our ability to replace our
inventory. As a result, our production and revenues would decrease
over time and may not be sufficient to satisfy our projected capital
expenditures. We may not be able to obtain additional financing in
such a circumstance.
If
we become a public company, our stock price could be extremely volatile and,
as
a result, you may not be able to resell your shares at or above the price you
paid for them.
An
active public market for our common
stock may not develop or be sustained. Further, the market price of our common
stock may decline below the price you paid for your shares.
Among
the factors that could affect our
stock price are:
§
industry
trends and the business success of our
vendors;
§
actual
or anticipated fluctuations in our quarterly financial and operating
results, including our comparable store
sales;
§
our
failure to meet the expectations of the investment community and
changes
in investment community recommendations or estimates of our future
operating results;
§
strategic
moves by our competitors, such as product announcements or
acquisitions;
§
regulatory
developments;
§
litigation;
§
general
market conditions;
§
other
domestic and international macroeconomic factors unrelated to our
performance; and
§
additions
or departures of key personnel.
The
stock market has from time to time
experienced extreme volatility that has often been unrelated to the operating
performance of particular companies. These kinds of broad market fluctuations
may adversely affect the market price of our common stock.
In
the past, following periods of
volatility in the market price of a company's securities, securities class
action litigation has often been instituted. If a securities class action suit
is filed against us, we would incur substantial legal fees and our management's
attention and resources would be diverted from operating our business in order
to respond to the litigation.
We
may need to raise additional money before we achieve profitability; if we fail
to raise additional money, it could be difficult to continue our
business.
Based
on our current plans, we believe that we may not have sufficient financial
resources to meet our operating expenses and capital
requirements. We may seek additional funding through public or
private financing or through collaborative arrangements with strategic
partners.
You
should be aware that in the
future:
§
we
may not obtain additional financial resources when necessary or on
terms
favorable to us, if at
all;
§
any
available additional financing may not be adequate;
and
§
we
may be required to sell shares of our common stock at extremely discounted
prices in order for us to obtain additional
financing.
If
we cannot raise additional funds
when needed, or on acceptable terms, we will not be able to continue to
operate.
Issuing
preferred stock with rights senior to those of our common stock could adversely
affect holders of common stock.
Our
charter documents give our board of
directors the authority to issue series of preferred stock without a vote or
action by our stockholders. The board also has the authority to
determine the terms of preferred stock, including price, preferences and voting
rights. The rights granted to holders of preferred stock may
adversely affect the rights of holders of our common stock. For
example, a series of preferred stock may be granted the right to receive a
liquidation preference – a pre-set distribution in the event of a liquidation –
that would reduce the amount available for distribution to holders of common
stock. In addition, the issuance of preferred stock could make it
more difficult for a third party to acquire a majority of our outstanding voting
stock. As a result, common stockholders could be prevented from
participating in transactions that would offer an optimal price for their
shares.
As
of the
date of this registration statement, the Board of Directors has designated,
5,000,000 shares of Non-Convertible Series A Preferred Stock, par value $.001
per share (the “Series A Preferred”), of which 5,000,000 shares have been issued
and are currently outstanding. The Series A Preferred shares are non-convertible
and maintain a ten for one voting preference such that a holder of the Series
A
Preferred shall be entitled to vote ten shares for every one share of Series
A
Preferred held by such shareholder.
We
do not anticipate paying dividends on our capital stock in the foreseeable
future.
We
do not anticipate paying any
dividends in the foreseeable future. We currently intend to retain our future
earnings, if any, to fund the development and growth of our business. In
addition, the terms of the instruments governing our existing debt and any
future debt or credit facility may preclude us from paying any
dividends.
Our
Board of Directors is authorized to effect up to two reverse stock
splits.
Our
shareholders have granted the
Board of Directors authority to amend the Company’s Articles of Incorporation
without further shareholder approval to effect up to two reverse stock splits
of
our outstanding Common Stock at a specific ratio, ranging from
1-for-2 shares to 1-for-500 shares, to be determined by the Board of
Directors. If the Board affects a reverse stock split, our outstanding shares
of
Common Stock will be reduced by the split ratio and the market price of our
Common Stock should increase proportionately. However, due to uncontrollable
market reactions to a reverse split, the market price of our Common Stock
may
not properly reflect the reverse split ratios and our shareholders may lose
substantial value in their investment.
Our
Board of Directors is authorized to effect up to two forward stock
splits.
Our
shareholders have granted the
Board of Directors authority to amend the Company’s Articles of Incorporation
without further shareholder approval to effect up to two forward stock
splits of our outstanding Common Stock at a specific ratio, ranging from
1-for-2 shares to 1-for-500 shares, to be determined by the Board of
Directors. If the Board affects a forward stock split, our outstanding shares
of
Common Stock will be increased by the split ratio and the market price of
our
Common Stock should decrease proportionately. However, due to uncontrollable
market reactions to a reverse split, the market price of our Common Stock
may
not properly reflect the forward split ratios and our shareholders may lose
substantial value in their investment.
Our
Board of Directors is authorized to effect up to two corporate name
changes.
Our
shareholders have granted the
Board of Directors authority to amend the Company’s Articles of Incorporation
without further shareholder approval to effect up to two corporate name
changes, to be determined by the Board of Directors.
Currency
risks and fluctuations could negatively impact our
company.
We
anticipate that some of our revenues
may be received in currencies other than US Dollars. Foreign currency
can fluctuate against the US dollar in which the Company’s financial statements
are prepared. There is no assurance that any currency exchange will be favorable
and given that some or our major expenses are fixed in US dollars, our operating
results could be negatively impacted by such currency fluctuations.
Risks
Related to Our Business
We
are a development stage company and we have limited
history.
We
are a
development stage company that has limited operations. Our plans and
businesses are “proposed” and “intended” but we may not be able to successfully
implement them. Our primary business purpose is the expansion of our
motorcycle parts manufacturing and sales business. As a development stage
company we are subject to all of the risks, uncertainties, expenses, delays,
problems, and difficulties typically encountered in the establishment of a
new
business. We expect that unanticipated expenses, problems, and
technical difficulties will occur and that they will result in material delays
in the development of our projects. We may not obtain sufficient
capital or achieve a significant level of operations and, even if we do, we
may
not be able to conduct such operations on a profitable basis.
We
pay significant marketing fees to a third party marketing
partner.
We
currently rely primarily on a third party marketing partner for marketing
efforts. Our website directs traffic to our marketing partner’s website and we
split equally all net income from sales derived from this business directed
to
our marketing partner’s website.
We
have limited experience in selling and manufacturing motorcycle
products.
We
plan
to enter the parts manufacturing industry. Our motorcycles parts and accessories
must be designed and manufactured to meet high quality standards in a
cost-effective manner. Because of our lack of experience in manufacturing
operations, we may have difficulty in timely producing motorcycle parts and
accessories in a volume sufficient to cover orders from our dealers. Any
material manufacturing delays could frustrate dealers and their customers and
lead to a negative perception of our products or our company. If we are unable
to manufacture effectively in terms of quality, timing and cost, our ability
to
generate revenues and profits will be impaired
Possible
Fluctuations in the Cost of Materials
Our
future financial condition and
results may be affected by fluctuations in the cost of materials. The price
and
availability of the materials used in the manufacturing of our products are
subject to market conditions affecting supply and demand. Our profitability
may
be negatively affected by increases in material costs to the extent we are
unable to pass on such higher costs to our customers.
We
rely on third party suppliers to obtain materials and provide component parts
for use in the manufacture of our products.
We
cannot
be certain that we will not experience supply problems such as unfavorable
pricing or untimely delivery of materials and components. In certain
circumstances, we rely on a single supplier to provide the entire requirement
of
a specific part and a change in this established supply relationship may cause
disruption in our production schedule. In addition, the price and availability
of raw materials and component parts from suppliers can be adversely affected
by
factors outside of our control such as increased worldwide demand. Further,
our
suppliers who also serve the automotive industry may be experiencing financial
difficulties due to a downturn in that industry. These supplier risks may
have a material adverse effect on our business and results of
operations.
We
depend upon a limited number of outside suppliers for our key motorcycle parts
and accessories.
Our
reliance upon outside vendors and suppliers for some of our parts and
accessories involves risk factors such as limited control over prices, timely
delivery and quality control. We have no written agreements to ensure continued
supply of parts and accessories. Although alternate suppliers are available
for
our key components, any material changes in our suppliers could cause material
delays in production and increase production costs. Since we have only a limited
operating history, we are unable to determine whether our current suppliers
will
be able to timely supply us with commercial production needs.
Our
inability to obtain timely delivery of quality components, or our loss or
interruption of services of one or more of our component suppliers, or any
material increases in the cost of our components, could result in material
production delays and reductions in our shipments, which could seriously impair
our ability to generate revenues.
We
face risks associated with purchasing products from foreign
companies
A
portion of our merchandise may be
imported from foreign suppliers. We rely upon relationships with our suppliers
but we have no long-term contracts with such suppliers. Our future success
will
depend in large measure upon our ability to maintain our existing supplier
relationship or to develop new ones. Dealing with imported products, we may
be
subject to the risks generally associated with doing business abroad, such
as
foreign governmental regulations, economic disruptions, delays in shipments,
freight cost increases and changes in political or economic conditions in
countries from which we purchase products. Our business is also subject to
the
risks associated with any new or revised United States legislation and
regulations related to imported products, including quotas, duties, taxes and
other charges or restrictions on imported merchandise. If any such factors
were
to render the conduct of business in particular countries undesirable or
impractical or if additional United States quotas, duties, taxes or other
charges or restrictions were imposed upon the importation of our products in
the
future, our financial condition and results of operations could be materially
adversely affected.
The
loss of the services of any members of our senior management team could impair
our ability to execute our business strategy and as a result, reduce our sales
and profitability.
We
depend on the continued services of
our senior management team. The loss of such key personnel could have a material
adverse effect on our ability to execute our business strategy and on our
financial condition and results of operations. We do not maintain key-person
insurance for members of our senior management team. We may have difficulty
replacing members of our senior management team who leave and, therefore, the
loss of the services of any of these individuals could harm our
business.
Our
planned growth together with our added obligations of being a public company
may
strain our business infrastructure, which could adversely affect our operations
and financial condition.
We
expect to grow at a rapid pace. As
we grow, we will face the risk that our existing resources and systems,
including management resources, accounting and finance personnel and operating
systems, may be inadequate to support our growth. We may also face new
challenges, including an increase in information to be processed by our
management information systems and diversion of management attention and
resources away from existing operations and towards growth in new markets.
Our
current growth strategy will require us to increase our management and other
resources over the next few years. In particular, heightened new standards
with
respect to internal accounting and other controls, as well as other
resource-intensive requirements of being a public company, may further strain
our business infrastructure. If we are unable to manage our planned growth
and
maintain effective controls, systems and procedures, we would be unable to
efficiently operate and manage our business and may experience errors or
information lapses affecting our public reporting, either of which could
adversely effect our operations and financial condition.
We
target sales of our products to a narrow market segment of our industry and
therefore, our business is more vulnerable to changes in this
market.
We
anticipate generating our revenues for the foreseeable future primarily from
sales of motorcycle parts and accessories in the foreign motorcycle market.
The
foreign motorcycle market constitutes only one segment of the motorcycle
industry. As a result of our focus on only one market segment of one industry,
we are more vulnerable to changes in demand in the foreign motorcycle market
than we would be if our business was more diversified.
Our
business is subject to seasonality which may cause our quarterly operating
results to fluctuate materially.
Motorcycle
sales generally are seasonal in nature since consumer demand is substantially
lower during colder seasons in North America. We may endure periods of reduced
revenues and cash flows during off-season periods, requiring us to lay off
or
terminate employees from time to time. Seasonal fluctuations in our business
could cause material volatility in the public market price of our common
stock.
We
need to continue to attract qualified employees.
Our
future success depends in large
part upon our ability to attract, train, retain and motivate employees.
Qualified individuals of the requisite caliber and number needed to fill
positions are in short supply in some areas. Our industry is characterized
by
high levels of employee attrition. Although we believe we offer competitive
salaries and benefits, we may have to increase spending in order to retain
personnel.
The
success of our growth plan will be
dependent on our ability to promote and/or recruit enough qualified personnel
to
support the future growth in the number of our stores. The time and effort
required to train and supervise a large number of new managers and associates
may divert resources from our existing stores and adversely affect our operating
and financial performance.
We
may pursue strategic acquisitions, which could have an adverse impact on our
business.
We
may from time to time consider
acquiring complementary companies or businesses. To do so, we would need to
identify suitable acquisition candidates, negotiate acceptable acquisition
terms
and obtain appropriate financing. Any acquisition that we pursue, whether or
not
successfully completed, may involve risks, including:
§
the
diversion of our capital and our management's attention from other
business issues and opportunities;
§
difficulties
in successfully integrating companies or stores that we acquire,
including
personnel, financial systems and controls, distribution, operations
and
general store operating procedures;
§
material
adverse effects on our operating results, particularly in the fiscal
quarters immediately following the acquisition as it is integrated
into
our operations;
§
material
adverse effects on our operating results due to the closure of stores
or
distribution centers;
§
potentially
dilutive issuances of our equity securities;
and
§
the
incurrence of debt and contingent liabilities and impairment charges
related to goodwill and other intangible assets, any of which could
harm
our business and financial
condition.
Our
success is highly dependent on our ability to provide timely delivery to our
customers, and any disruption in our delivery capabilities or our related
planning and control processes may adversely affect our operating
results.
An
important part of our success is due
to our ability to deliver products quickly to our customers. Our ability to
maintain this success depends on the continued identification and implementation
of improvements to our planning processes, distribution infrastructure and
supply chain. We also need to ensure that our distribution infrastructure and
supply chain keep pace with our anticipated growth. The cost of these enhanced
processes could be significant and any failure to maintain, grow or improve
them
could adversely affect our operating results.
We
may not have sufficient funds to operate our business and may not be able to
obtain additional financing.
If
we do not operate within our budget,
we will require additional funds to continue our business. We may not
be able to obtain additional financing as needed, on acceptable terms, or at
all, which would force us to delay our plans for growth and implementation
of
our strategy which could seriously harm our business, financial condition,
and
results of operations. If we need additional funds, we may seek to
obtain them primarily through stock or debt financings. Those
additional financings could result in dilution to our stockholders.
Failure
to fund continued capital expenditures could adversely affect
results.
If
our anticipated revenues do not
materialize, we may have a limited ability to expend the capital necessary
to
maintain business operations at expected levels, resulting in a decrease in
revenue over time. Historically, we have financed these expenditures primarily
with proceeds from debt and equity financings. If our cash flow from
anticipated operations is not sufficient to satisfy our capital expenditure
requirements, there can be no assurance that additional debt or equity financing
or other sources of capital will be available to meet these
requirements.
Costs
of legal matters and regulation could exceed estimates.
We
may become parties to a number of
legal and administrative proceedings involving matters pending in various courts
or agencies. These include proceedings associated with facilities
currently or previously owned, operated or used by us and include claims for
personal injuries and property damages. Our current business may
involve management of regulated materials and are subject to various
environmental laws and regulations. It is not possible for us to estimate
reliably the amount and timing of all future expenditures related to
environmental and legal matters and other contingencies.
Any
projections used in this registration statement may not be
accurate.
Any
and all projections and estimates
contained in this registration statement or otherwise prepared by us are based
on information and assumptions which management believes to be accurate;
however, they are mere projections and no assurance can be given that actual
performance will match or approximate the projections.
Our
estimates may prove to be inaccurate and future net cash flows are
uncertain.
Our
estimates of both future sales and
the timing of development expenditures are uncertain and may prove to be
inaccurate. We also make certain assumptions regarding net cash flows
and operating and development costs that may prove incorrect when judged against
our actual experience. Any significant variance from these
assumptions could greatly affect our estimates of future net cash flows and
our
ability to borrow under our credit facility.
ITEM
2. DESCRIPTION
OF THE BUSINESS
Corporate
History Overview
VisiTrade,
Inc., ("VisiTrade" or the "Registrant" which is sometime referred to as "we",
"us", "our" and the "Company" whenever practical) was originally incorporated
in
the State of Nevada on March 2, 1998, as USI Communications, Inc. We provided
engineering, rental and program services to the broadcast industry, video
production, and manufacture of mobile and fixed video equipment. We conducted
operations from facilities located in North Carolina and ceased operation in
August 2000.
In
July
of 2002 we purchased the rights to an innovative water irrigation system and
filed a Certificate of Amendment to our Articles of Incorporation effectively
changing our corporate name to Square Shooter, Inc. As Square Shooter, Inc.,
we
designed, developed and marketed this water irrigation system designed to
conserve water consumption by dispensing water from sprinkler systems in a
square shaped pattern, thusly reducing overspray onto unwanted areas and
focusing water delivery to necessary areas. Despite continued efforts to market
our innovative water irrigation system, we again ceased operations in late
2004.
In
November of 2006, we entered into an asset purchase agreement with VisiTrade,
L.L.C., a Nevada limited liability company, where, in exchange for 19,852,723
shares of our common stock, we purchased certain software that acted as a
trading platform for financial market participants. In connection with the
asset
purchase agreement, we filed an Articles of Merger with the Nevada Secretary
of
State effectively changing our name to VisiTrade, Inc. We believed that this
software had the potential to develop a cost effective alternative trading
system that could provide a 24-hour trading platform and facilitate bringing
together purchasers and sellers of securities while performing the functions
commonly performed by larger securities exchanges. Again, despite continued
efforts to market this alternative trading system, we ceased operations in
early
2007.
In
October of 2007, we resumed operations as an online retailer of aftermarket
Triumph motorcycle parts, accessories and apparel through our website,
www.sportbike-customs.com.
General
Company Info
We
are an
online retailer of aftermarket Triumph motorcycle parts, accessories and
apparel. We plan to market our products primarily through our internet websitewww.sportbike-customs.com. In addition to our retail operations, we plan to
maintain an online dealer network for Triumph parts and accessory retailers.
Our
corporate headquarters are located at 2038 Corte del Nogal, Suite 110, Carlsbad,
California92011. Our telephone number at our corporate head office is
760-804-8844.
Triumph
Motorcycle History
The
Triumph company's roots began in 1883 when Siegfried Bettmann moved to Coventry
in the UK from Nuremberg, part of the German Empire. Bettman sold bicycles
but
used the brand name Triumph rather than his own. He was joined by another
Nuremburg engineer Maritz Schulte and they produced their own bicycles. In
1896,
Bettmann established a German subsidiary for cycle production in his native
city, which became part of the Triumph-Adler Company. When the internal
combustion engine led to the first motorcycles, Bettman and Schulte turned
to
motorcycle production. In the 1920s Triumph purchased the former Hillman car
factory in Coventry and produced a saloon car under the name of the Triumph
Motor Company. Unfortunately, Triumph struggled to make a profit from the
manufacture and sale of cars. The bicycles and motorcycles were sold off as
the
Triumph Cycle Co. In 1936, Jack Sangster of Ariel Ltd purchased the motorcycle
division, to form the Triumph Engineering Co Ltd largely led by ex-Ariel
employees. Triumph was sold to their rivals BSA by Sangster in
1951.
In
the
1960s, 60% of all Triumph production was exported, which, along with the BSA's
80% exports, made the group susceptible to the Japanese expansion. By
1969 fully 50% of the US market for bikes over 500cc belonged to Triumph, but
technological advances at Triumph had failed to keep pace with the rest of
the
world. Triumph motorcycles as a result were nearly obsolete even when they
were
new; further, Triumph's manufacturing processes were highly labor-intensive
and
largely inefficient. The British marquees were poorly equipped to compete
against the massive financial resources of Japanese heavy industries that
targeted competitors for elimination via long-term plans heavily subsidized
by
the Japanese government. When the first Honda 750cc four cylinder was released
for sale to the public, Triumph and BSA were facing trouble.
Triumph
is now carving out a niche in the motorcycle market based on nostalgic engine
technologies and design. The 790cc and 865cc iterations of the Bonneville and
Thruxton look like slightly revised versions of their 1960s counterparts. Less
overt is the use of the inline triple — an engine layout other manufacturers
have mostly abandoned. Triumph has learned not to compete head to head with
Japanese manufacturers in the sportbike world, with the flagship Daytona 955
marketed as a "GT" sportsbike rather than a challenger to Yamaha's R1 or
Suzuki's GSX-R1000.
Our
Products And Services
With
Triumph motorcycles growing in popularity over the past decade, there has been
an unfilled demand for Triumph parts and accessories. Our retail sales operation
will aim to fulfill that demand through the online sales of aftermarket Triumph
motorcycle parts, accessories and apparel.
Our
business operations will be composed of two primary business focuses: online
retail sales of aftermarket Triumph parts and accessories and the maintenance
of
an online Triumph dealer network.
Consumers
looking for Triumph parts and accessories have traditionally been forced to
either hunt down parts and accessories from the scattered network of small
Triumph retailers or purchase from large general parts distributors that lack
the familiarity with the Triumph brand. Many of these larger motorcycle parts
and accessory retailers offer only a limited line of Triumph products. Our
aim
is to provide a centralized, experienced and knowledgeable retail outlet for
everything Triumph. Consumers will be able to locate and purchase a wide variety
of Triumph parts, accessories, and apparel in one location rather than being
forced to hunt down individual parts from scattered retailers.
Our
state
of the art retail website will allow consumers to browse Triumph parts and
accessories as easily as if they were standing in a retail outlet. Consumers
using the website will be able to either browse through categorized pages on
Triumph parts and accessories or refine their shopping experience using detailed
search engines designed to put the consumer in contact with the parts they
need
quickly and efficiently. Each item will be displayed on our website with a
detailed picture, description and pricing information to assist the consumer
in
finding and purchasing their desired products.
Through
our website, we believe we will provide a number of benefits to our consumers
and suppliers including:
§
Ready
Access to Products on a Secure Site. Our customers will be able to
access and purchase our products 24 hours a day from the convenience
of their computer. We will not sell any personal information about
our
customer base to third parties and all online sales transaction will
be
secured.
§
Value
Pricing. Through our multiple sourcing networks, we will locate
and obtain Triumph parts and accessories at reduced prices. Our
experienced sales team will cost-effectively matches customer demand
with
supply on a just-in-time basis, employing our rapid fulfillment
process.
§
Positive
Customer Experience. Our internal sales and customer service
representatives will be available by e-mail and telephone to respond
to
questions and provide guidance regarding product availability, order
status and product use and
functionality.
§
Reliable
and Efficient Distribution Channel. We will provide a low-risk,
high-volume channel through which our suppliers may sell
merchandise.
§
Protection
of Brand Integrity. We will maintain the integrity of our
suppliers’ brands by responding to customer inquiries regarding their
products in a professional manner, by ensuring that we sell only
those
quality goods that we have offered on our websites and by selling
only
factory sealed goods in original form together with all accessories
still
intact.
§
Optimize
inventory management through the use of technology. Our merchandise
buyers will be supported by proprietary software that provides information
on product sales, margins and inventory levels. This technology enables
us
to make informed decisions and quickly change prices in an effort
to
maximize sales volume, gross profits and return on inventory
capital.
§
Maintain
low customer acquisition costs. We believe that by utilizing targeted
online campaigns, including direct e-mail campaigns, we will be able
to
keep our per customer acquisition costs relatively
low.
Our
current product line consists
primarily of the following:
§ Performance
Packages
§ Shocks
§ Suspension
Parts
§ Lights
§ Mirrors
§ Gas
caps
§ Exhaust
Systems
§ Headers
§ Wheels
§ Tires
§ Engine
Parts
§ Sparks
plugs
§ Body
parts and fenders
§ Intake
Manifolds
§ Bore
kits
§ Cams
§ Clutch
Springs
§ Screens
§ Motorcycle
parts
§ Seats
§ Batteries
§ Clothing
§ Lifestyle
accessories
§ Riding
Gear
In
addition to online retail sales, we plan to create and maintain an online
network of Triumph parts and accessory dealers. The Triumph community currently
lacks a centralized network of parts and accessory dealers. Our goal is to
provide the consumer with a one stop online retail outlet where they can find
a
broad range of Triumph parts, accessories, and gear. By offering Triumph dealers
and consumers an online forum, we hope to not only satisfy our customers by
offering easy access to hard to find parts and accessories but draw in
additional customers to our products through online links to our
website.
Marketing
and Sales
We
compete in the motorcycle specialty products market, specifically the Triumph
products aftermarket. The motorcycle specialty products segment has historically
been less cyclical than the motorcycle aftermarket industry, reflecting the
favorable demographics and profile of this segment's customer base. Unlike
the
overall motorcycle aftermarket, the specialty products market is driven by
enthusiasts and therefore is less sensitive to economic factors. These customers
are passionate about their motorcycles and view enhancing the performance and
appearance of their motorcycles as more than a hobby.
In
2004
total world motorcycle registrations were estimated at over two million units,
including all motorcycles and scooters with engine displacements greater than
50cc registered in the United States, Western Europe, Japan and
Australia. The sport bike segment of the motorcycle market in these areas
has continued to grow in popularity. Triumph’s line of motorcycles falls within
this sport bike category. Triumph Motorcycles (America), Ltd. reported 2004
sales of Triumph motorcycles in the United States reached 7,533 units. This
was
an increase of 35% over the 2003 sales making Triumph the fastest growing
production motorcycle company in America for the 2004 year. 2005 worldwide
sales
were even higher with Triumph reporting sales up 29% from 2004. This included
a
10% increase in UK sales, a 40% increase in North America sales, a 43% increase
in France and Switzerland sales, a 34% increase in Japan sales, a 25% increase
in Italy sales, and an 18% increase in Germany sales. Triumph reported a 25%
per
year growth rate for the last two years.
In
the
60's, the Triumph was the bike to have. It was effortless to operate and
maintain, was more agile and created power more efficiently than its American
competitors. New Triumphs are no different. From the Speed Triple to the classic
Bonneville, Triumph has continued to remain original, yet carried its legacy
with an agile chassis and great power to weight ratios. Nevertheless, with
all
this momentum for Triumph, there exists a lack of quality high performance
upgrades on the market. VisiTrade was formed to fill this gap.
We
believe that several factors have contributed to the growth in our market
segment including: (i) increases in sales of Triumph motorcycles which has
resulted in increasing the aggregate number of Triumph motorcycles in use and
therefore potential consumers, (ii) increases in average motorcycle life, which
we believe contributes to increased demand for motorcycle aftermarket parts
as
owners seek to enhance the appearance of older motorcycles, and (iii) the
continuing enthusiasm of Triumph owners for motorcycle styling. We further
believe that consumer desire for individuality in motorcycle appearance will
contribute to our growth.
Marketing
for our website and products will be accomplished through both print and online
advertising in newspapers, motorcycle magazines and motorcycle websites. In
addition, we will rely upon referrals from our wholesale distributors and other
dealers in our online dealer network.
Competition
We
feel
the Triumph motorcycle parts, accessory and apparel industry has a market need
that has been unfulfilled. Many retail motorcycle outlets offer a wide range
of
motorcycle parts and accessories, but do not focus on the Triumph name. Triumph
customers and enthusiasts shopping these retail motorcycle outlets are faced
with wading through many product lines only to find a small selection of Triumph
parts and accessories available. Although there are a few online competitors
specializing in Triumph parts, accessories and apparel, such as British Only
Motorcycle Parts (www.britishonly.com), Baxter Cycle (www.batercycle.com) and
British Spares, Ltd. (www.britishspares.com), none stand out as the industry
leader. Our goal is to provide these Triumph enthusiasts with one central
location for anything and everything Triumph.
The
motorcycle parts, accessory and apparel industry is highly competitive with
respect to price, service, quality and location. There are numerous competitors
in the motorcycle accessory and apparel industry that possess substantially
greater financial, marketing, personnel and other resources than we do. There
can be no assurance that we will be able to respond to various competitive
factors affecting the business. We plan to gain a competitive advantage over
our
competitors in the motorcycle accessories and apparel industry by offering
a one
stop online shop for quality Triumph products at a competitive
price.
Distribution
Methods of Products and Services
Our
primary distribution channel for our products will be our online website. We
plan to use FedEx to ship products to our customers. Customers purchasing
products from the website will have a variety of shipping options including
standard shipping, next day and overnight shipping. In addition, we will offer
international shipping to customers located outside of the United
States.
Suppliers
Our
suppliers will consist of a number of sources for Triumph parts, accessories
and
apparel. We do not rely upon any one major supplier for our products. We have
no
long-term supply contracts and have experienced no significant problems in
supplying our operations. Although we have strategically selected suppliers,
we
believe that there are a number of other sources available, contributing to
our
ability to obtain competitive pricing. Increases in prices may have a short-term
impact on our profit margins for our products.
Dependence
on Major Customers
Our
target market focuses on individual retail customers. We are not currently
dependent on any major customers. We do not expect that this will change in
the
future.
Patents,
Trademarks, Licenses
We
do not have any designs which are
copyrighted, trademarked or patented.
Environmental
and Regulatory Issues
Motorcycles
and
motorcycle accessories sold in the United States and many other countries are
subject to environmental emissions regulations and safety standards with which
we must comply in order to sell products in such countries. Applicable
regulations in the United States include the emissions and noise standards
of
the U.S. Environmental Protection Agency and the more stringent emissions
standards of the State of California Air Resources Board. Motorcycles and
motorcycle accessories sold in the United States are also subject to the
National Traffic and Motor Vehicle Safety Act and the rules promulgated
thereunder by the National Highway Traffic Safety Administration. Many of our
motorcycle parts and accessories may be required to comply with applicable
regulations in the other countries in which they are
distributed.
Research
And Development
We
do not foresee any immediate future
research and development costs
Employees
We
do not
currently have any full time employees. We utilize the services of independent
contractors.
ITEM
3. MANAGEMENT'S
PLAN OF OPERATION
The following discussion and analysis should be read in conjunction with our
audited consolidated financial statements and related notes included in this
report. This report contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995. The
statements contained in this report that are not historic in nature,
particularly those that utilize terminology such as “may,”“will,”“should,”“expects,”“anticipates,”“estimates,”“believes,” or “plans” or comparable
terminology are forward-looking statements based on current expectations and
assumptions.
Various
risks and uncertainties could cause actual results to differ materially from
those expressed in forward-looking statements. Factors that could cause actual
results to differ from expectations include, but are not limited to, those
set
forth under the section “Risk Factors” set forth in this report.
The
forward-looking events discussed in this registration statement, the documents
to which we refer you and other statements made from time to time by us or
our
representatives, may not occur, and actual events and results may differ
materially and are subject to risks, uncertainties and assumptions about
us. For these statements, we claim the protection of the “bespeaks
caution” doctrine. All forward-looking statements in this document
are based on information currently available to us as of the date of this
report, and we assume no obligation to update any forward-looking
statements. Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause the actual results to
differ materially from any future results, performance or achievements expressed
or implied by such forward-looking statements.
Plan
of Operation
We
are an online retailer of
aftermarket Triumph motorcycle parts, accessories and apparel. We will market
our products primarily through our internet websitewww.sportbike-customs.com.
In addition to our planned manufacturing and retail operations, we will maintain
an online dealer network for Triumph parts and accessory retailers.
Our
primary short term objective over the next 12 month period is the development
of
our online website. The website will offer our customers a variety of services
such as
§
Allowing
customers to view all of our products and accessories online. Each
product
will have a separate picture and description of the product. For
our
larger ticket items, we plan to allow customers to view the products
in
3-D graphics allowing them a complete image of the product they are
interested in
§
Allowing
customers to place, pay for, and ship orders online. We plan to give
customers the option of completing their transactions online, or
transferring to a telephone operator and completing their transaction
over
the phone. We will need to implement support systems for services
such as
customer payment options, shipping arrangements and similar support
services.
§
An
online chat room where customers can log on and discuss Triumph issues
with other owners, would-be owners and enthusiasts. We also plan
to offer
a Question and Answer bulletin board where Triumph enthusiasts can
post
questions and comments regarding Triumph related issues. Both our
staff
and other website users will be able to post answers to the questions.
These features should help boost the credibility of our website and
name.
In
addition to our website, we are
currently seeking networking partners to become part of our online parts and
accessories dealer network. Our aim is to offer our customers access to anything
and everything Triumph. Through our online network, if we do not carry the
item
the customer is looking for, the customer can search through our network
affiliate’s websites and find the item they wish to purchase.
In
order to increase sales, we plan to
increase our brand awareness through advertising. We plan to utilize newspaper,
trade magazine, trade show, online, and word of mouth advertising
outlets.
We
plan to expand our operations into
parts manufacturing. Many Triumph parts, especially for older model Triumphs,
are scarce. The aim of the dealer network is to offer our customers a central
location to find these Triumph parts and accessories. Initially we hope to
offer
the customer a wide range of parts and accessories from existing manufacturers
to choose from. In addition to retailing other manufacturer's parts, we hope
to
begin manufacturing our own line of Triumph parts and accessories under the
VisiTrade name. By building the reputability of our name through our retail
sales website, we hope to transfer that same customer base and satisfaction
with
our retail business to our manufacturing business.
Off-balance
Sheet Arrangements
We
do not
maintain any significant off-balance sheet arrangements.
ITEM
4. DESCRIPTION
OF THE PROPERTY
At
present, we do not own any property. Our executive offices currently
consist of shared leased office space located at: 2038 Corte Del
Nogal, Suite 110, Carlsbad, CA92011 and our phone number is
760-804-8844. We currently do not pay rent at our shared office
space. We may require a larger office space if we grow. We believe
there is an adequate supply of suitable office space in surrounding areas on
terms acceptable to us.
ITEM
5. SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
following table sets forth certain
information regarding the beneficial ownership of the 28,747,698 issued and
outstanding shares of our common stock as of the date of this registration
statement by the following persons:
1.
Each
person who is known to be the beneficial owner of more than five
percent
(5%) of our issued and outstanding shares of common
stock;
2.
Each
of our Directors and executive Officers; and
3.
All
of our Directors and Officers as a
group
Title,
Class and Percentage of Securities Beneficially
Owned
Name
and Address
Common
Series
A Preferred
Black
Forest International, LLC(1)(2)
22,373,635
77.8%
5,000,000
100%
Mark
L. Baum (3)
0
0%
0
0%
Total
22,373,635
77.8%
5,000,000
100%
(1)
WSITE
International Foundation is the beneficial owner of, and has dispositive
and voting power over 50% of the 22,373,635 Common Shares and 5,000,000
Series A Preferred Shares of VisiTrade, Inc. held by Black Forest
International, LLC. The address is Suite 1-A #5, Calle Eusebio A.
Morales,
El Cangrejo, Panama City, Panama.
(2)
Fundacion
De Las Mercedes is the beneficial owner of, and has dispositive and
voting
power over 50% of the 22,373,635 shares of VisiTrade, Inc. held
by Black Forest International, LLC. The address is Suite 1-A #5,
Calle
Eusebio A. Morales, El Cangrejo, Panama City,
Panama.
(3)
The
address is 2038 Corte Del Nogal, Suite 110, Carlsbad, CA92011.
Beneficial
ownership is determined in accordance with the rules and regulations of the
SEC. The number of shares and the percentage beneficially owned by
each individual listed above include shares that are subject to options held
by
that individual that are immediately exercisable or exercisable within 60 days
from the date of this registration statement and the number of shares and the
percentage beneficially owned by all officers and directors as a group includes
shares subject to options held by all officers and directors as a group that
are
immediately exercisable or exercisable within 60 days from the date of this
registration statement.
ITEM
6. DIRECTORS
AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
The
following table sets forth, as of the date of this report, the name, age and
position of our directors, executive officers and other significant
employees:
President,
Chief Executive Officer, Chief Financial Officer and
Secretary
The
backgrounds of our directors, executive officers and significant employees
are
as follows:
Mark
L. Baum, Esq., President, Chief Executive Officer, Chief Financial Officer
and
Secretary.
Mr.
Baum
is our President, Chief Executive Officer, Chief Financial Officer and
Secretary. Mr. Baum is not a full time employee and has other outside
commitments. In 2002, Mr. Baum founded Business Consulting Group Unlimited,
Inc., a Southern California-based merchant banking firm. Mr. Baum is a licensed
attorney in the State of California and the principal attorney for The Baum
Law
Firm, P.C. a firm which he founded in 1998 and has been operating on an ongoing
basis. Mr. Baum has more than 11 years experience in creating, financing and
growing development stage enterprises in a variety of industries. Mr. Baum
has
participated in numerous public spin-offs, venture fundings, private-to-public
mergers, corporate restructurings, asset acquisitions and asset divestitures.
Mr. Baum’s law practice focuses on securities laws and related issues for
small-cap and micro-cap publicly reporting companies.
Mr.
Baum has not been involved in a
legal proceeding within the past 5 years that would materially affect his
integrity or his ability to act on behalf of our company.
ITEM
7. EXECUTIVE
COMPENSATION
The
following table summarizes the
annual compensation paid to VisiTrade, Inc.’s named executive officers for the
two years ended December 31, 2007 and 2006:
Annual
Compensation
Long-Term
Compensation
Other
Annual
Common
Shares
Compensation
Restricted
Underlying
(#
of Shares of
Stock
Options
All
Other
Name
and Position
Year
Salary
Bonus
Common
Stock)
Awards
Granted
Compensation
Michael
West(1)
2007
-
-
-
-
-
-
Former
President and
Chief
Executive Officer
2006
-0-
-0-
1,041,667
-0-
-0-
-0-
C.
Anthony Ferracone(2)
2007
-0-
-0-
259,259
-0-
-0-
-0-
Former
Secretary and
Treasurer
2006
-0-
-0-
1,300,926
-0-
-0-
-0-
Lawrence
Bolton(3)
2007
-0-
-0-
259,259
-0-
-0-
-0-
Former
President and
Chief
Executive Officer
2006
-0-
-0-
259,259
-0-
-0-
-0-
Mark
L. Baum, Esq.(4)
2007
-0-
-0-
-0-
-0-
-0-
-0-
President,
Chief
Executive
Officer,
2006
-
-
-
-
-
-
Secretary
and Treasurer
(1)
Mr.
Michael West held the positions of President and Chief Executive
Officer
January 1, 2006 until his resignation on October 2,2006.
(2)
Mr.
C. Anthony Ferracone held the positions of Secretary and Treasurer
January1, 2006 until his resignation on July 6,2007.
(3)
Mr.
Lawrence Bolton held the positions of President and Chief Executive
Officer October 2, 2006 until his resignation on July 6,2007.
(4)
On
July 7, 2007, Mr. Mark L. Baum, Esq. was appointed as our President,
Chief
Executive Officer Secretary and Treasurer. Mr. Baum receives no
compensation for holding these
positions.
Aggregated
Option Exercise In Last Fiscal Year And Fiscal Year End Option
Values
Our
executive officers were not issued any options which could have been exercised
during the fiscal year ended December 31, 2006 or 2007.
Directors'
Compensation
All
directors receive reimbursement for reasonable out-of-pocket expenses in
attending board of directors meetings and for promoting our
business. From time to time we may engage certain members of the
board of directors to perform services on our behalf. In such cases, we
compensate the members for their services at rates no more favorable than could
be obtained from unaffiliated parties.
Compensation
Committee
We
have
not formed an independent compensation committee
ITEM
8. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
None.
ITEM
9. DESCRIPTION
OF SECURITIES
The
following description of our capital stock is a summary of the material terms
of
our capital stock. This summary is subject to and qualified in its entirety
by
our Articles of Incorporation and Bylaws, and by the applicable provisions
of
Nevada law.
Our
authorized capital stock consists of 50,000,000 shares of stock consisting
of
45,000,000 shares of common stock, par value $.001 per share (the “Common
Stock”) of which 28,747,698 are issued and outstanding, and 5,000,000 shares of
preferred stock, par value $.001 per share (the “Preferred Stock”) of which
5,000,00 shares are issued and outstanding. Stockholders do not have any
preemptive or subscription rights to purchase shares in any future issuance
of
our common stock. There are no options, warrants or other instruments
convertible into shares outstanding.
Common
Stock
The
Board
of Directors is authorized to issue 45,000,000 shares of common stock, par
value
$.001 per share, of which 28,747,698 have already been issued and currently
remain outstanding. Each share of our common stock is entitled to share pro
rata
in dividends and distributions with respect to our common stock when, as and
if
declared by the Board of Directors from funds legally available therefore.
No
holder of any shares of common stock has any preemptive right to subscribe
for
any of our securities. Upon dissolution, liquidation or winding up of the
Company, the assets will be divided pro rata on a share-for-share basis among
holders of the shares of common stock after any required distribution to the
holders of preferred stock, if any. All shares of common stock outstanding
are
fully paid and non-assessable.
Preferred
Stock
The
Board
of Directors is authorized to, and has subsequently designated, 5,000,000 shares
of Non-Convertible Series A Preferred Stock, par value $.001 per share (the
“Series A Preferred”), of which 5,000,000 shares have been issued and are
currently outstanding. The Series A Preferred shares are non-convertible and
maintain a ten for one voting preference such that a holder of the Series A
Preferred shall be entitled to vote ten shares for every one share of Series
A
Preferred held by such shareholder.
Dividend
Policy
Subject
to any preferential rights of any series of preferred stock, holders of shares
of common stock will be entitled to receive dividends on the stock out of assets
legally available for distribution when, as and if authorized and declared
by
our Board of Directors. We currently intend to retain all available funds for
use in our business and therefore do not anticipate paying any cash dividends
in
the foreseeable future. Any future determination relating to dividend policy
will be made by the discretion of our Board of Directors and will depend on
a
number of factors, including the future earnings, capital requirements,
financial condition and future prospects and such other factors as our Board
of
Directors may deem relevant. Payment of dividends on the common stock may be
restricted by loan agreements, indentures and other transactions entered into
by
us from time to time. We do not anticipate the payment of cash dividends on
our
common stock in the foreseeable future.
Voting
Rights
Holders
of common stock are entitled to one vote per share on all matters voted on
generally by the stockholders, including the election of directors, and, except
as otherwise required by law or except as provided with respect to any series
of
preferred stock, the holders of the shares possess all voting
power. The holders of shares of our common stock do not have
cumulative voting rights in connection with the election of the board of
directors, which means that the holders of more than 50% of such outstanding
shares, voting for the election of directors, can elect all of the directors
to
be elected, if they so choose, and, in such event, the holders of the remaining
shares will not be able to elect any of our directors.
Liquidation
Rights
Subject
to any preferential rights of any series of preferred stock, holders of shares
of common stock are entitled to share ratably in our assets legally available
for distribution to our stockholders in the event of our liquidation,
dissolution or winding up.
Absence
of Other Rights
Holders
of common stock have no preferential, preemptive, conversion or exchange
rights.
PART
II
ITEM
1. MARKET
PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER
MATTERS
Our
common stock is currently traded on
the Pink Sheets market under the symbol "VTDI". The high and low bid
prices for the Common Stock, as reported by NASAQ, are indicated for the periods
described below. Such prices are inter-dealer prices without retail
markups, markdowns or commissions, and may not necessarily represent actual
transactions.
2007
Low
High
First
Quarter
$.11
.95
Second
Quarter
.08
.30
Third
Quarter
.05
.25
Fourth
Quarter
.04
.06
2006(1)
Low
High
First
Quarter
NA
NA
Second
Quarter
NA
NA
Third
Quarter
NA
NA
Fourth
Quarter
.95
.95
(1) Our
securities were not quoted by NASDAQ for the first three quarters of
2006.
Holders
As
of the
date of this report, we have 48 registered shareholders (not including other
beneficial owners with shares on deposit with brokerage houses) owning a total
of 28,747,698 shares of our common stock.
Dividends
None.
Securities
Authorized For Issuance Under Equity Compensation Plans
None.
ITEM
2. LEGAL
PROCEEDINGS
None
ITEM
3. CHANGES
IN AND DISAGREEMENT WITH ACCOUNTANTS
None
ITEM
4. RECENT
SALES OF UNREGISTERED SECURITIES
During
the year ending 2005, we issued a total of 2,250,000 common shares of common
stock to officers of the Company as compensation for their services. These
shares were valued at $0.10 per share.
In
December of 2005, we issued a total of 2,038,461 common shares to consultants
of
the Company as compensation for their services for the year ending 2005. These
shares were valued at $0.10 per share.
During
the year ending 2006, we issued a total of 2,601,852 common shares to officers
of the Company as compensation for their services. These shares were valued
at
$0.10 per share.
On
November 2, 2006, we approved of a 5 to 1 reverse split. The financial
statements included herein have been retroactively restated to reflect this
reverse split.
On
November 7, 2006, we retired 224 shares of common stock due to the 5 to 1
reverse split. These shares were valued at $0.10 per share.
In
December of 2006, we issued 19,852,723 shares in connection with an Asset
Purchase Agreement between the Company and Visitrade, LLC. These shares were
valued at $0.10 per share.
During
the year ending 2007, we issued a total of 518,518 common shares to officers
of
the Company as compensation for their services. These shares were valued at
$0.10 per share.
In
January of 2007, we issued 1,000,000 common shares to consultants of the Company
as compensation for their services. These shares were valued at $0.95 per
share.
In
January of 2007, we issued 40,000 common shares to consultants of the Company
as
compensation for their services. These shares were valued at $0.55 per
share.
In
February of 2007, we issued 2,050,000 common shares to consultants of the
Company as compensation for their services. These shares were valued at $0.17
per share.
In
April
of 2007, we issued 75,000 common shares to consultants of the Company as
compensation for their services. These shares were valued at $0.08 per
share.
In
May of
2007, we issued 40,000 common shares to consultants of the Company as
compensation for their services. These shares were valued at $0.26 per
share.
In
June
of 2007, we issued 350,000 common shares to consultants of the Company as
compensation for their services. These shares were valued at $0.18 per
share.
In
July
of 2007, we cancelled 660,000 common shares that were previously issued in
error.
All
of
the issuances of securities described above were deemed to be exempt from
registration in reliance on Section 4(2) of the Securities Act of 1933 as
transactions by an issuer not involving a public offering. We made the
determination that each investor had enough knowledge and experience in finance
and business matters to evaluate the risks and merits of the investment.
There was no general solicitation or general advertising used to market
the securities. We provided each investor with disclosure of all aspects
of our business, including providing the investor with press releases, access
to
our auditors, and other financial, business, and corporate information. A legend
was placed on the stock certificates stating that the securities have not been
registered under the Securities Act and cannot be sold or otherwise transferred
without an effective registration or an exemption therefrom.
ITEM
5. INDEMNIFICATION
OF DIRECTORS AND OFFICERS
There
is no provision in the Articles
of Incorporation, now the By-Laws of the Corporation, nor any Resolution of
the
Board of Directors, providing for indemnification of Officers or Directors.
The
Registrant is aware of certain provision of Nevada Corporate Law (referred
to
below as the "NRS" or the Nevada Revised Statutes) which creates or imposes
any
provision for indemnity of Officers or Directors.
Nevada
Statutes
Section
78.7502 of the Nevada Revised Statutes, as amended, provides for the
indemnification of our officers, directors, employees and agents under certain
circumstances as follows:
“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:
(a) Is
not liable pursuant to NRS 78.138; or
(b)
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 is liable pursuant to NRS
78.138 or 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,
or
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:
(a) Is
not liable pursuant to NRS 78.138; or
(b)
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.”
Section
78.751 of the Nevada Revised Statutes describes the authorization required
for
discretionary indemnification; advancement of expenses; limitation on
indemnification and advancement of expenses as follows:
“1.
Any discretionary indemnification pursuant to 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:
(a) By
the stockholders;
(b)
By
the board of directors by majority vote of a quorum consisting of
directors who were not parties to the action, suit or
proceeding;
(c)
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
(d)
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 pursuant to NRS 78.7502 and advancement of expenses
authorized in or ordered by a court pursuant to this section:
(a) 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 NRS 78.7502 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
was
material to the cause of action.”
Report
of Independent Certified Public Accountants
Board
of
Directors
Visitrade,
Inc.
We
have
reviewed the accompanying consolidated balance sheets of Visitrade, Inc. as
of
September 30, 2007 and the related consolidated statements of income,
stockholders’ equity, and cash flows for the nine-month periods ended September30, 2007. These interim financial statements are the responsibility
of the Company’s management.
We
conducted our review in accordance with the standards of the Public Company
Accounting Oversight Board. A review of interim financial statements
consists principally of applying analytical procedures and making inquiries
of
persons responsible for financial and accounting matters. It is
substantially less in scope than an audit in accordance with the standards
of
the Public Company Accounting Oversight Board, the object of which is the
expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in notes to the
financial statements, the Company has negative working capital, negative cash
flows from operations and recurring operating losses which raises substantial
doubt about its ability to continue as a going concern. Management’s
plans in regard to these matters are also described in the notes to the
financial statements. These financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Based
on
our review, we are not aware of any material modifications that should be made
to the accompanying financial statements in order for them to be in conformity
with generally accepted accounting principles accepted in the United States
of
America.
We
have
also audited the accompanying balance sheets of Visitrade, Inc. as of December31, 2006, 2005 and 2004, and the related statements of income, changes in
stockholders’ equity, and cash flows for each of the three years in the period
ended December 31, 2006. These financial statements are the
responsibility of the Company’s management. Our responsibility is to
express an opinion on these financial statements based on our
audits.
We
conduct our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit
includes examining on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis
for our opinion.
As
discussed in notes to the financial statements the Company has not generated
significant revenues or profits to date. This factor among others
raises substantial doubt the Company will be able to continue as a going
concern. The Company’s continuation as a going concern depends upon
its ability to generate sufficient cash flow to conduct its operations and
its
ability to obtain additional sources of capital and financing. The
accompanying consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty. Management’s
plans concerning this matter are also discussed in notes to the financial
statements.
In
our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of the Company at December 31, 2006,
2005 and 2004, and the results of its operations and it cash flows for each
of
the three years in the period ended December 31, 2006 in conformity with U.S.
generally accepted accounting standards.
USI
Communications, Inc. (the “Company”) was incorporated on March 2, 1998 in
the state of Nevada. The company provided engineering, rental and program
services to the broadcast industry, video production, and manufacture of mobile
and fixed video equipment. The Company conducted operations from facilities
located in North Carolina and ceased operation in August 2000. On July 9, 2002,
the Company filed a Certificate of Amendment to their Articles of Incorporation
effectively changing their corporate name to Square Shooter, Inc. As Shooter,
Inc., the Company designed, developed and marketed a water irrigation system
designed to conserve water consumption. On November 1, 2006, the Company entered
into an asset purchase agreement with VisiTrade, L.L.C., a Nevada limited
liability company, where the Company purchased certain software that acted
as a
trading platform for financial market participants. The Company filed a
Certificate of Amendment to their Articles of Incorporation effectively changing
their corporate name to VisiTrade, Inc. The Company ceased operations
as VisiTrade, Inc. in early 2007. In October of 2007, the Company resumed
operations as an online retailer of aftermarket Triumph motorcycle parts,
accessories and apparel.
NOTE
2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis
of Presentation
The
accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America, which
contemplate continuation of the Company as a going concern. However,
the Company has no operations and has not established a source of
revenue. This matter raises substantial doubt about the
Company's ability to continue as a going concern. These financial
statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts, or amounts and classification of
liabilities that might be necessary should the Company be unable to continue
as
a going concern.
Management
plans to take the following steps that it believes will be sufficient to provide
the Company with the ability to continue in existence:
Management
intends to actively pursue merger candidates that have ongoing operations and
a
source of revenue.
Use
of Estimates
The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reporting amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of
the financial statements and the reported amounts of revenues and expenses
during the periods. Management makes these estimates
using the best information available at the time the estimates are made;
however, actual results could differ materially from these
estimates.
Fair
Value of Financial Instruments
The
carrying value of cash and cash equivalents, accounts receivable note receivable
and accounts payable and related party payable approximate fair value due to
the
relatively short maturity of these instruments.
Property
and Equipment
Property
and equipment are stated at cost. Expenditures for maintenance, repairs and
renewals are charged to expense, whereas major additions are capitalized. The
cost and accumulated depreciation of assets retired, sold or otherwise disposed
of are eliminated from the accounts and resulting gains or losses, if any,
are
reflected through the statement of income.
Depreciation
is computed using the straight-line method over the estimated useful lives
of 7
years. There was no depreciation expense for the nine months ended
September 30, 2007 and the years ended December 31, 2006, 2005 and
2004.
Comprehensive
Income
SFAS
No.
130, Reporting Comprehensive Income, establishes standards for the
reporting and display of comprehensive income and its components in the
financial statements. During the years ended December 31, 2006, 2005,
and 2004 and the period ending September 30, 2007the Company did not have
any
components of comprehensive income (loss) to report and, accordingly, has not
included a schedule of comprehensive income in the financial
statements.
Income
Taxes
The
Company accounts for income taxes in accordance with SFAS No. 109,
Accounting for Income Taxes. Deferred taxes are provided on
the liability method whereby deferred tax assets are recognized for deductible
temporary differences, and deferred tax liabilities are recognized for taxable
temporary differences. Temporary differences are the differences
between the reported amounts of assets and liabilities and their tax
bases. Deferred tax assets are reduced by a valuation allowance when,
in the opinion of management, it is more likely than not that some portion
or
all of the deferred tax assets will be realized. Deferred tax assets
and liabilities are adjusted for the effects of changes in tax laws and rates
on
the date of enactment.
Net
Loss Per Share
SFAS
No.
128, Earnings per Share, requires dual presentation of basic and
diluted earnings or loss per share (“EPS”) for all entities with complex capital
structures and requires a reconciliation of the numerator and denominator of
the
basic EPS computation to the numerator and denominator of the diluted EPS
computation. Basic EPS excludes dilution; diluted EPS reflects the
potential dilution that could occur if securities or other contracts to issue
common stock were exercised or converted into common stock or resulted in the
issuance of common stock that then shared in the earnings of the
entity.
Basic
loss per share is computed by dividing net loss applicable to common
shareholders by the weighted average number of common shares outstanding during
the period. Diluted loss per share reflects the potential dilution
that could occur if dilutive securities and other contracts to issue common
stock were exercised or converted into common stock or resulted in the issuance
of common stock that then shared in the earnings of the Company, unless the
effect is to reduce a loss or increase earnings per share. The
Company had no potential common stock instruments which would result in a
diluted loss per share. Therefore, diluted loss per share is
equivalent to basic loss per share.
In
June
2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in
Income Taxes - An Interpretation of FASB Statement No. 109, (“FIN
48”). FIN 48 clarifies the accounting for uncertainty in income taxes
recognized in an enterprise's financial statements in accordance with FASB
Statement No. 109, Accounting for Income Taxes. FIN 48 also
prescribes a recognition threshold and measurement attribute for the financial
statement recognition and measurement of a tax position taken or expected to
be
taken in a tax return that results in a tax benefit. Additionally,
FIN 48 provides guidance on de-recognition, income statement classification
of
interest and penalties, accounting in interim periods, disclosure, and
transition. This interpretation is effective for fiscal years
beginning after December 15, 2006. The Company does not expect the
application of FIN 48 to have a material affect on its financial
statements.
In
September 2006, the FASB issued SFAS No. 157, Fair Value
Measurements. This statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles,
and expands disclosures about fair value measurements. This statement
applies under other accounting pronouncements that require or permit fair value
measurements. SFAS 157 is effective for fiscal years beginning after
November 15, 2007. The Company does not expect the application
of SFAS No. 157 to have a material affect on its financial
statements.
In
September 2006, the FASB issued SFAS No. 158, "Employers'
Accounting for Defined Benefit Pension and Other Postretirement Plans−An
amendment of FASB Statements No. 87, 88, 106,
and 132(R)". One objective of this standard is to make it
easier for investors, employees, retirees and other parties to understand and
assess an employer's financial position and its ability to fulfill the
obligations under its benefit plans. SFAS No. 158 requires employers to
fully recognize in their financial statements the obligations associated with
single−employer defined benefit pension plans, retiree healthcare plans, and
other postretirement plans. SFAS No. 158 requires an employer to
fully recognize in its statement of financial position the overfunded or
underfunded status of a defined benefit postretirement plan (other than a
multiemployer plan) as an asset or liability and to recognize changes in that
funded status in the year in which the changes occur through comprehensive
income. This statement also requires an employer to measure the
funded status of a plan as of the date of its year−end statement of financial
position, with limited exceptions. SFAS No. 158 requires an
entity to recognize as a component of other comprehensive income, net of tax,
the gains or losses and prior service costs or credits that arise during the
period but are not recognized as components of net periodic benefit cost
pursuant to SFAS No. 87. This statement requires an entity to
disclose in the notes to financial statements additional information about
certain effects on net periodic benefit cost for the next fiscal year that
arise
from delayed recognition of the gains or losses, prior service costs or credits,
and transition asset or obligation. The Company is required to
initially recognize the funded status of a defined benefit postretirement plan
and to provide the required disclosures for fiscal years ending after
December 15, 2006. Management believes that this statement
will not have a significant impact on the Company’s consolidated financial
statements.
In
February of 2007 the FASB issued SFAS 159, “The Fair Value Option
for Financial Assets and Financial Liabilities—Including an amendment
of FASB Statement No. 115.” The statement permits entities
to choose to measure many financial instruments and certain other items at
fair
value. The objective is to improve financial reporting by providing entities
with the opportunity to mitigate volatility in reported earnings caused by
measuring related assets and liabilities differently without having to apply
complex hedge accounting provisions. The statement is effective as of
the beginning of an entity’s first fiscal year that begins after
November 15, 2007. The Company is analyzing the potential
accounting treatment.
NOTE
3 – STOCKHOLDERS’ EQUITY
Common
Stock
Effective
June 12, 2002, the Company effected a one (1) for four and one-quarter (4.25)
reverse stock split of the authorized, issued and outstanding common
stock These financial statements have been retroactively restated to
reflect this change. There were 42 fractional shares that were canceled due
to
the reverse stock split.
During
the year ended December 31, 2004, the Company issued 450,000 common shares
for
services rendered to the Company valued at $0.50 per
share. Value was based on Managements determination of value
since there was no market for the shares.
During
the year ended December 31, 2005, the Company issued 550,000 common shares
for
services rendered to the Company valued between $0.325 and $0.50 per
share. Value was based on Managements opinion of value for the
550,000 shares at $0.50 share issues which took place early in the year and
on a
December 2005 transaction where $100,000 of debt was exchanged for 307,692
shares of stock at $0.325 per share.
Effective
November 2, 2006, the Company effected a one (1) for five (5.0) reverse stock
split of the authorized, issued and outstanding common stock. These financial
statements have been retroactively restated to reflect this change. There were
224 fractional shares that were canceled due to the reverse stock
split.
During
the year ended December 31, 2006, the Company issued 916,667 common shares
for
services rendered to the Company valued at $0.325 per share. Value was based
on
the December 2005 debt conversion transaction.
During
the year ended December 31, 2006, the Company issued 19,852,723 common shares
for purchase of software that was valued at $1,290,427. Value was based on
the
December 2005 debt conversion transaction.
During
the nine months ended September 30, 2007, the Company issued 4,592,036 shares
for services rendered to the Company valued between $0.95 and $0.08 per share.
Value was based on the trading value of the stock on the date of
issue.
NOTE
4 – RELATED PARTY TRANSACTIONS
For
the
nine months ended September 30, 2007 and the years ended December 31, 2006,
2005, and 2004, officers of the Company paid $0, $1,431, $1,612, and $1,612,
respectively to cover certain general and administrative expenses of the
Company. In July 2007, the officers gave up their rights to the
amount due to them when the Company entered into the sale arrangement with
LB
Acquisitions Inc. As of September 30, 2007, there are no amounts due
to related parties.
NOTE
5 – ASSET PURCHASE AND REORGANIZATION AGREEMENT
On
July6, 2007, the Company entered into an Asset Purchase and Reorganization Agreement
(the “Agreement”) with LB Acquisitions, Inc. (“LB”). The Agreement
provided that the Company transfer to LB all cash, accounts receivable,
inventory, supplies, equipment, intangible rights, trade secrets, know how,
customer lists, inventions, websites and other intangible property used in
the
business of the Company. LB will assume exclusive financial
responsibility for all of the Company’s liabilities, debts, and
obligations. LB will deliver 29,407,698 shares of LB’s common stock
to the Company as consideration for the transfer of the above items from the
Company to LB. Immediately upon receipt of such shares pursuant to a resolution
of the Board of Directors and proxy vote of the Company’s
shareholders, the Company will dividend these shares to its existing
shareholders or record as of July 1, 2007. As of the date of this filing, the
Company is still awaiting the issuance of these shares from LB
Acquisitions. At the time of the transaction LB Acquisitions,
Inc. became a wholly owned subsidiary of the Company. However,
because of the proxy vote of the shareholders to dividend these shares, the
asset is being shown as an investment at September 30, 2007. The
Company hopes to complete this transaction in the fourth quarter of
2007.
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies
that
it has duly caused this registration statement to be signed on its behalf by
the
undersigned, thereunto duly authorized, in the City of Carlsbad, California,
on
December 13, 2007.
VisiTrade,
Inc.
/s/
Mark L. Baum,
Esq.
By: Mark
L. Baum, Esq.
Its: Chief
Executive Officer and Chief Financial Officer
(Principal
Executive Officer and
Principal Accounting Officer)
Pursuant
to the requirements of the Securities Act of 1933, as amended, this registration
statement has been signed by the following persons in the capacities and on
the
dates indicated.
