U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2001
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to ________________
Commission file no. 0-32429
STARTCALL.COM, INC.
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(Name of small business issuer in its charter)
Florida 65-0955118
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
719 5th Street Miami Beach, FL 33139
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (786) 497-1500
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(Former name and/or former address, if changes since last report)
Securities registered under Section 12(b) of the Exchange Act:
Name of each exchange on
Title of each class which registered
None None
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Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $.000666 par value
(Title of class)
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Copies of Communications Sent to:
Anslow & Jaclin, LLP
4400 Route 9, 2nd Floor
Freehold, New Jersey 07728
Tel: (732) 409-1212 - Fax: (732) 577-1188
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes No x
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Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]
The Registrant's revenue for the fiscal year ended December 31, 2001: $3,471.00
Aggregate market value of the voting common stock held by non-affiliates of the
registrant as of April 29, 2002, was: $1,600,501.
There were 24,281,950 shares of the registrant's common stock outstanding as of
April 29, 2002.
DOCUMENTS INCORPORATED BY REFERENCE: None
Transitional Small Business Disclosure Format: Yes [ ] No [X]
SUMMARY TABLE OF CONTENTS SUMMARY TABLE OF CONTENTS
PART I
Item 1. Description of Business.
Item 2. Description of Property.
Item 3. Legal Proceedings.
Item 4. Submission of Matters to a Vote of Security Holders.
PART II
Item 5. Market for Common Equity and Related Stockholder
Matters.
Item 6. Management's Discussion and Analysis or Plan of
Operation.
Item 7. Financial Statements.
Item 8. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
PART III
Item 9. Directors, Executive Officers, Promoters and Control
Persons; Compliance with Section 16(a) of the
Exchange Act.
Item 10. Executive Compensation.
Item 11. Security Ownership of Certain Beneficial Owners and
Management.
Item 12. Certain Relationships and Related Transactions.
Item 13. Exhibits, List and Reports on Form 8-K.
PART I
Forward Looking Statements
This Form 10-KSB includes "forward looking statements". All statements, other
than statements of historical facts, included or incorporated by reference in
this Form 10-KSB which address activities, events or developments which the
Company expects or anticipates will or may occur in the future, including such
things as future capital expenditures (including the amount and nature thereof),
demand for the Company's products and services, expansion and growth of the
Company's business and operations, and other such matters are forward looking
statements. These statements are based on certain assumptions and analyses made
by the Company in light of its experience and its perception of historical
trends, current conditions and expected future developments as well as other
factors it believes are appropriate in the circumstances. However, whether
actual results or developments will conform with the Company's expectations and
predictions is subject to a number of risks and uncertainties, general economic
market and business conditions; the business opportunities (or lack thereof)
that may be presented to and pursued by the Company; changes in laws or
regulation; and other factors, most of which are beyond the control of the
Company. Consequently, all of the forward looking statements made in this Form
10-KSB are qualified by these cautionary statements and there can be no
assurance that the actual results or developments anticipated by the Company
will be realized or, even if substantially realized, that they will have the
expected consequence to or effects on the Company or its business or operations.
The Company assumes no obligations to update any such forward-looking
statements.
ITEM 1. Description of Business
We were incorporated under the name Click and Call Corporation in the State of
Florida in October, 1999 and on June 5, 2000 a Certificate of Amendment was
filed with the Secretary of State of Florida changing the name of the Company to
StartCall.com, Inc.
StartCall.com, Inc. is an application service provider (ASP) that offers
real-time interaction technology as an out source service. It was established to
suit the need for a quick and easy solution to customer service while conducting
e-commerce business over the Internet.
The Company will offer to all businesses the opportunity to improve their online
customer care service by placing an Internet voice box and a Text Chat button
with a URL push feature on their website. These tools allow their visitors and
customers visiting their websites to receive live help at the crucial point of
purchase and or when any type of assistance is needed.
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Business Overview.
The nature of our products or services is to offer a technology that will enable
visitors to a web site to simply click on a button and request live help at the
crucial point of purchase or when needed or desired by the customer. We
currently provide only two ways of Interaction: Via Voice or through Voice over
Protocol Technology and Interactive Text Chat or Instant Messaging.
Through a public relations campaign, in-house sales representatives, strategic
alliances, and advertising, StartCall's goal is to become the leading business
for all businesses that provide online customer service solutions for
e-commerce. The Company's plan is to bring the element of human-touch to the
online world. Our tools allow their visitors, customers and potential customers
visiting their Web site to receive live help at the crucial point of purchase
and/or when any type of assistance is needed. We intent to become the
predominant e-commerce service company by providing our Online Interactive
Technology that will be both Efficient and Cost Effective for any business with
a presence in the Internet, our primary service is ClickiChat/Support.
The ClickiChat/Support button allows Net surfers to receive live assistance via
Text. Live Chat is popular among many of today's Internet buyers. Customer
service representatives ("CSRs") can manage multiple chat sessions
simultaneously,
serving multiple buyers cost effectively. Chat sessions are helpful in
processing orders for the hearing impaired. The ClickiChat/Support service is
personal, private and secure. The URL push or Pushing pages feature impresses
and educates site - visitors on the navigation of the site, to show product
information or instructions not otherwise available, or to share confidential,
competitive difference or pricing information that would not otherwise be made
available for all Web site visitors. A CSR can instantly "push" those pages and
images to qualified prospects in an impressive manner that supports the selling
process.
We believe that our ClickiChat service offers our clients the opportunity to
increase sales by answering customer questions and solving customer problems at
critical points in the buying process. It also enables our clients to reduce
customer service costs by allowing them to enhance operating efficiency and to
improve customer response times. In addition, information captured in
transcripts of live text-based interactions can be used by our clients to
increase their responsiveness to customer needs and preferences, thereby
improving customer satisfaction, loyalty and retention.
We started offering our ClickiChat/Support service on July 1, 2001. We have
received small amounts of revenue from the sale of our ClickiChat/Support
solution as well as miscellaneous consulting. Even though we have not promoted
our ClickiChat/Support service, we had visitors to our web site who decided to
buy our service and therefore we able to receive some limited revenues.
Therefore, we are going to start selling our services directly through our Web
sites: www.startcall.com,www.liveinternethelp.com, www.clickicall.com,
www.clickichat.com. We intend to generate traffic by promoting the name of our
services. In addition, we intend to start promoting our services through our
strategic marketing alliances
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by offering to their customers a 30 FREE trial of our ClickiChat/Support
service. This means that the customers will have unlimited usage of the
Clickichat/Support service for 30 days. With some of our strategic marketing
alliances we will have an ongoing promotional marketing campaign for yet an
undetermined amount of time. We do not and will not rely on one specific
marketing alliance to generate substantial revenues and we will continue finding
new channels of distribution to market our services. This 30 day FREE trial
campaign will focus on our ClickiChat/Support service only. This offers means
that we will allow business with a presence on the Internet to test our
ClickiChat/Support service on their site as an Interactive Text Chat Solution.
Our methods to increase traffic to our Web sites will be by initiating email
campaigns talking about our services. We will try to attract more awareness to
our services by doing road shows or participating in trade shows, press
releases, associating to chamber of commerce nationally and internationally. We
will provide a 30-day FREE trial of our ClickiChat/Support service to all first
time users so they may become familiar with our service.
We feel that our potential difficulty is timing. There are several other
companies competing in our area of business services. Our goal is to achieve
certain parameters that will allow us to compete with companies which provide
similar services to those of the ClickiChat/Support solution. In addition, our
goal is to maintain up-to-date with new technologies to provide our customers
with rapid solutions to their needs in the area of online customer service. In
addition, we also feel that we should be able to gain market share due to the
quality of our marketing alliances, and influences these strategic alliances may
have on their customers.
Since our primary product is the ClickiChat solution, we feel confident that
once we officially launch our services we should be able to gain market share
fairly quickly. We do not choose to make any other of our services such as
ClickiCall our primary product because, in the opinion of our management, there
is not enough interest in the market for this type of service. Furthermore, the
ClickiCall service requires end users to have a sound card on their computer,
plus speakers and other minor components, which everyone does not have. This is
unlike the ClickiChat/Support which is just simple text chat that every computer
is able to do. There is always the possibility that someone else may come up
with a better technology and for lesser price. Currently, there are no companies
or technology offering services similar to our services at our price structure.
Our prices were effective on June 1st, 2001. Each of these packages will provide
the following functions and benefits:
Reduces Cost - Your customer service reps can each manage up to 4 support
sessions at one time vs. answering phone call, one on one. More Reduced Costs -
By answering more customer/prospect services questions over the web, your 800
expenses will decrease.
Make support personnel more efficient - Streamline your organization's chat
sessions with pre-determined messages, allowing your support staff to answer
customers/prospects questions quicker and more accurately.
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Managing your Customer/Prospect Service Rep - Many companies record the
telephone conversation of their customer/prospect service reps, however they are
randomly reviewed. Documentation of each text chat session using
ClickiChat/Support allows for management to evaluate and train more efficiently.
Learn about your Customer/Prospect before the chat session begins - Free
integration with the ClickiChat/Exchange (ClickiChat/Exchange goes into open
beta on December 15th. Push Page Technology Control the customer's/prospect's
desktop - The ability to push URL web pages and images to the
customer's/prospect's desktop assists in providing your customers/prospects with
immediate visual and documented support. Integrated FAQ access - Quick access to
all FAQ contents.
Chat transfer - Quickly transfer an in-progress chat to another supporter.
Listing Departments - Allows customer/prospect to target question(s) to the
appropriate personnel.
Audio and Visual Cues- Computer speaker(s) will ring differentiating a
ClickiChat inquiry vs. a telephone inquiry as well as a pop-up window appearing
at the start and during chat session activity.
Archiving Data - past chat session activity is stored in the
ClickiChat/administration database and can be reviewed at anytime. Leave a
Message Feature - If unavailable, this option will allow an e-mail to be
forwarded to your address or any address that you determine. Dedicated or
floating support personnel - We offer per/seat and floating user licenses.
Chat Priority Distribution - Forwards calls to first available and/or uses
priority listing, which you determine. Call Center Support - The ability to
support multiple organizations.
For Administrators- Turning your customer support from a cost center to a profit
center requires technology that is simple and cost-effective. ClickiChat/Support
recognizes this, and provides your IT staff and administrators with the
following benefits:
Rapid implementation - Get up and running in one-hour. ClickiChat/Support
requires very little administrative overhead since it is a 100% hosted ASP
solution that is completely web-driven. ClickiChat does not require any software
installations for you, your supporters, or your customer/prospect's computers.
Easy administration - We offer our own comprehensive customer support portal
that allows you to administer and analyze your entire ClickiChat/Support
solution via support.ClickiChat.com (link)
Departmental support - Some of your support reps may be from the sales
department, others may come directly from your customer support department.
Upper management may participate in online customer support as well. To
accommodate the different requirements for each type of user, ClickiChat/Support
allows you to set up roles and use those settings to determine things such as
who should get incoming requests first, and who has access to different
components of our support portal. In
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addition, your customer/prospect will appreciate their needs being directed to
the appropriate personnel without having to be transferred and on hold as is
often the case.
Extensive customization - Your brand is what's important. ClickiChat/Support's
extensive customization capabilities provide you with over 15 URL parameters.
You can change everything from the background color of the chat window, to the
image used for your "go" button.
Watch over your chat sessions - With ClickiChat/Support you can silently monitor
all chat sessions. Administrators or department heads can interject comments
silently to their support personnel, or include the customer/prospect in their
comment. Additionally, administrators and department heads can broadcast silent
messages to all of their employees at one time.
Analyze chat session - Through our support portal, you have complete access to
all your chat archives via an online searchable repository. All our transcripts
are stored as XML documents and offer full-text or parameterized queries to help
you locate old chat sessions.
Detailed usage statistics - Our support portal also gives you detailed
information on exactly how the ClickiChat/Support service is being utilized. We
offer reports that can detail your entire organization (such as average chat
session times and most frequent access times) to your individual supporters
(such as average amount of time spent per chat session, amount of time they are
logged into the service, etc.) Easy integration - We realize that
ClickiChat/Support isn't the only customer/prospect application you use, so
we've made it easy to integrate our service with your favorite help desk, CRM,
or sales force automation software.
In order to personalize our ClickiChat service to our customers, we have set-up
three different packages that will enable our customers to provide LIVE HELP to
their online customer/prospect.
1. FREE ClickiChat/Support version: Free accounts will have complete access to
all ClickiChat/Support functionality, except for the following features: (To be
more specific this free version will be able to do all the functions available
in our service except the ones written below)
o Pre-set messages
o Push pages
o History profile
o Chat transcripts
o Button and chat window customization
2. Silver Package: ClickiChat/Silver enables the customer to have complete
access to all ClickiChat/Support functionalities. Our ClickiChat/Silver includes
one (1) operator per license.*
o Cost: $29.95 per month
o Additional Operators: $24.95 per month
o Usage: Unlimited usage per month
3. Gold Package: Our ClickiChat/Gold enables your customers/prospects to also
have complete access to all the ClickiChat/Support functionalities.
ClickiChat/Gold includes four (4) operators per license.*
o Cost: $89.95 per month
o Additional Operators: $19.95 per month
o Usage: Unlimited usage per month
*Dedicated or floating support personnel - We offer per/seat and floating user
licenses. (You will have access to establishing unlimited operators, however
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simultaneous chat sessions can only occur if you have the required paid monthly
licenses). As set forth above, the difference between our ClikiChat Silver
package and Gold package is that our Silver package allows one operator per
license and that our Gold package allows up to 4 operators per license. They
both have all functionalities set forth above except for the amount of operators
who able to use the software simultaneously. For further information on our
Pricing Model for ClickiChat please visit: www.liveinternethelp.com.
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Currently we do not pay or receive revenues from other sources such as joint
ventures or strategic alliances or online affiliated programs. We expect to
receive revenues from the following sources once we launch our services:
1. Strategic Alliances
2. Online Affiliated Programs
3. Link Exchange
Our strategic marketing alliances are simply associations with companies that
will help StartCall promote the usage and sale of its services to their
customers and prospects. This type of relationship generates revenues to the
Company when one of our strategic alliance refers one of its customers to buy
our services. In exchange we provide this strategic marketing allied company a
percentage of the revenue collected from each sale.
Furthermore, we may have what is known as the new online economy affiliated
online programs which refers to when businesses with a presence on the Internet
wish to promote our services by placing small adds on their web site. For every
account we receive from this web site, the web site owner will receive a
commission. This is what is known as an affiliated program.
Our agreements with our third parties supplier is to purchase rights for usage
of the technology in order to provide our services. We currently have two
suppliers. At present, we have reported the minimum expenses incurred to date as
components of research and development costs. Upon the engagement of customers,
We charge our customers a flat rate of $14.95 per month, which includes 50 calls
or sessions, additional call are $.25 per session unlimited.
2. Velaro, Inc. Provide us with the technology platform in order for us to sell
our ClickiChat/Support service. We purchased such rights for $25,000 and an
annual support fee $5,000 per year, plus handling fees or services when
necessary. We have developed our own proprietary technology and is schedule to
launch on June 1st, 2002. In the interim we will continue using Velaro's
platform.
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The Velaro function is to oversee the daily administrative operations of the
Clickichat/Support solution. StartCall through Velaro provides reporting modules
for tracking information and running reports plus control modules for
customization. Users can generate their own real-time daily, weekly, monthly or
customized reports; track call volume, length of the ClickIchat sessions, usage
and collect customer data. (ClickIchat/Support is the Company's Interactive Text
Solution).
We have several different contracts at this stage and are constantly trying to
bring new potential strategic marketing alliances to promote our services.
According to recent research undertaken by the Company in yahoo.com, we found
exactly 8,071 ISP's (Internet Service Providers). We will pursue a campaign
calling and emailing these ISP's with the objective to establish strategic
marketing alliances. As of this date, we have entered into agreements with the
following companies:
o Pricealliance.com
o LiveChatSupport.com
o Makeastore.com
We use a general dealer/promoter agreement with these companies. The terms of
the agreements are standard for each company with the exception of the
compensation plan which may change from one promoter to another, based upon the
potential business that each individual promoter may have to offer. The
following sets forth the general terms of these agreements:
1. We utilize the services of the Promoter to promote said Services to
end users. Promoter agrees to take reasonable steps to make available
to potential end-users an opportunity to purchase our services in
accordance with the our best interest. Additional products or services
offered or sold to Promoter's contacts will be commissionable to
Promoter. The Promoter shall be our non exclusive dealer for selling
"Internet related services".
2. We agree to make payments due to Promoter under this Agreement and to
provide the Promoter with documents and information normally provided
by us and necessary to fulfill Promoter's duties hereunder, including,
but not limited to, Application Documents, Service Agreements,
marketing materials, and documents and information regarding practices
to configure the Services and support the Services.
3. We pay the Promoter a fee for accounts in accordance with a
Compensation Schedule set forth as an Appendix. The Promoter only
receive fees from those accounts resulting from Promoter's efforts as
evidenced by a duly executed original Service Agreement during the
term of this Agreement and at times when neither Promoter nor end-user
is in breach or default of this Agreement and/or the Service
Agreement. Commissions are be payable to Promoter not later than the
last day of each month following the month of the Company's receipt.
4. The Agreements are effective upon execution by the last party to sign,
and expires the sooner of six (6) months or the sale of 5000 account
of ClickiChat/Support. The Agreement may thereafter renew on terms
mutually agreeable to both parties. The Agreement may be terminated by
either party at any time upon 30 days written notice or by a new term
Agreement is executed, which shall supersede this Agreement.
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5. The following sets forth the standard appendix to these agreements
with qregard calculation of compensation for these promoters: The
expected performance of Promoter is to refer a minimum of 5 new
subscribers per month or $ 1,000.00 in billing revenue. Minimum
requirements are expected by the end of 6 months from the date of this
Agreement. Month 7 will officially be the end of the ramp-up period
and we expect the above stated performance. Both parties agree that
Clickichat/Support is the subject of this Agreement and that the
Promoter will maintain our price structure. The Promoter will refer
potential purchasers of Live Chat licenses (Clickichat) at the
Standard Price (Set by us and currently $ 29.95 per month with
unlimited usage). The Promoter will receive a residual income as
listed on the commission scale on Page #2 of the total monthly fees or
sales that result from their referrals or follow up purchases as well
as compensation of the installation fee, if charged.
The objective of these agreements is to initiate the promotion and sale of the
Company's e-commerce interactive solution ClickiChat/Support. The
above-mentioned companies combined have approximately 1 Million commerce Web
sites as potential immediate customers. The agreements with these companies are
strategic marketing alliances and these companies are not customers of the
Company.
The Company plans to grow and expand by establishing new strategic marketing
alliances throughout the world to provide a variety of interactive e-commerce
solutions.
Continuing to Build Strong Brand Recognition. The StartCall brand name will be
prominently displayed on the pop-up dialogue window that appears when an
Internet user has requested assistance. We believe that high visibility
placement of our brand name will create greater brand awareness and increase
demand for the StartCall service. In addition, we intend to leverage increasing
awareness of our brand and our reputation as a leading provider of real-time
sales and customer service technology to become a well- recognized solution for
companies doing business on the Internet. We intend to expand our traditional
and online marketing activities to achieve these goals.
Achieving and Maintaining a Technological Leadership Position. The Company's
goal is to achieve and maintain a leadership position in the industry through
its technology. The Company believes it can achieve these goals since Vocaltec,
has received more rewards than any other company developing Voice over IP
technology. Once StartCall launches its own technology, it will concentrate its
efforts to continue offering to its customers, competitive prices and added
features to its services as needed or demanded in the market place. Our focus is
to maintain ourselves in constant awareness of new developments of tightly
integrated software design and network architecture that is both reliable and
scalable.
We have already undertaken research by testing companies which competes in its
arena such as: www.liveperson.com, www.livehelper.com, and www.humanclick.com.
In addition, we intend to devote significant resources for research and
development of new innovations. Over the course of the next six months we intend
to invest approximately $100,000, if necessary, for the research and development
of new innovations in our ClickiChat/Support service.
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COMPETITION
StartCall will compete in the areas of Internet Live Customer Care Support over
the Internet. It will provide its services to e-commerce based companies looking
to improve their online customer care and/or provide interactive features
through their Web site. We directly compete with companies focused on online
live customer support and application service providers that facilitate
real-time sales and customer service interaction.
The primary competition for StartCall's primary service, ClickiChat/Support,
includes LivePerson, Inc. which is a pure-play ASP customer Service Company with
a market cap of approximately $50 million. It is a publicly held company that
has over 2000 customers and its revenues for the financial year 2000 were $6.2
million with a net loss of $29.5 million. LivePerson's chat service is priced at
three times compared to our ClickiChat/Support. From a product offering
perspective, ClickiChat has the most in common with LivePerson: both products
are completely web-based and offer similar functionalities.
The Company will also compete, in some ways, with much larger companies such as
Cisco, eGain, and Kana. All three of these vendors offer large integrated CRM
solutions that contain some forms of web-based chat. These vendors compete on a
much larger scale, and their engagements are typically greater than $150,000.
None of these vendors offer an ASP solution to their products, and therefore
have a much longer sales cycle, and require a significantly greater upfront
investment from their customers. While StartCall's ClickiChat/Support has
competitive overlap with these vendors from a functional standpoint, StartCall
does not expect to engage them in head-to-head customer acquisitions.
We may also compete with other pure-play customer service organizations such as:
cs-live, FaceTime, LiveAssist, and eShare. These vendors are third- and second-
tier players that offer online customer support in the same fashion as our
service. Each competes on different value propositions: some vendors offer the
service for free but only provide limited functionality, requiring the customer
to "upgrade" to the fee-based version. Others offer advertising supported
versions of their product that push ad-banners into the chat session. We
believes that we will offer the most cost effective price models available in
the market today. To compare please visit C/Net web site or go to:
http://webware.cnet.com/b/li/1-1005-1257.asp?tag=st.ww.dp.ClickiChat_rel.1-1005-
1257.
When we stated that it is our goal to become and maintain a leadership position
with our services, we feel we can support such statement based on a number of
different reasons such as pricing, obviously no assurance is available that no
other competitor will maintain their prices lowers than ours. which
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2. In addition, our sales force and customer service representatives focus on
quality care service. StartCall provides live connectivity on the web between
businesses and their prospects and/or clients. As such, it offers state-of-
the-art technology at a fraction of the cost of traditional live-connectivity
solutions without a significant, up-front financial commitment. With StartCall,
small, mid-size and large corporations can now provide their customers
immediate, on-demand interaction with their customer care or sales
representatives, and this valuable competitive edge could be part of a Web site
the same day it is requested. Unlike our competitors providing hardware/software
applications at customer's premises, StartCall is uniquely positioned to provide
easy-to-implement, easy-to-use, and the most cost effective and reliable Web
live-connectivity solutions, both via the telephone as well as in the chat
format.
MARKETING
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The Company will market its products and services through internal direct sales
and Independent Sales Channels. Internet sales and promotion are managed by
Sylvio Martini, our Vice President of Technology, and strategic alliances are
managed by Antonio Treminio, our President and Chief Executive Officer. From its
central offices in Miami, Florida, StartCall manages the marketing,
administration, and coordination for all of the Company's activities.
A business in need of StartCall's service has several options. It can either log
on to our Web site at http://www.startcall.com and receive live assistance, it
can call our toll free number or send an email to inform us of their interest in
our service. Upon acknowledging such interest, a customer service representative
will contact them to establish the relationship. Within 24 hours thereafter, the
business will be able to have their potential customers utilize the service with
the simple click of a button. A trained StartCall technician will work in
conjunction with the Webmaster to install the services. Once installed, the
process of utilizing the CickiChat/Support button is quite simple for the
businesses potential customers.
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We focus to maintain ourselves in constant awareness of new developments of
tightly integrated software design and network architecture that is both
reliable and scalable. As previously mentioned we intent to devote initially
$100,000 for research and development of our own ClickiChat/Support technology.
Specifically, together with our strategic marketing alliances we plan to expand
the features and functionality of our existing service, develop broader
applications for our service and create new products and services that will
benefit our expanding client base.
As we mentioned previously we will continue seeking opportunities to form new
strategic marketing alliances as well as seeking the possibilities to acquire
other companies that will enhance our business. We have entered into selected
strategic alliances with re-sellers and customer service call centers and may
enter into additional alliances in the future.
Our marketing activities are funded directly with the Company's working capital
and other activities such as online affiliated programs and link exchange banner
ads. Online Affiliated Programs is a new wave of self creating strategic
alliances that are automatically establish online through a network of different
web sites, These web sites measure the number of orders and visitors that one
particular web site may get from or referred by another.
Affiliate Marketing is a revolutionary method for driving profits through
revenue sharing relationships between online merchants and content sites.
Affiliate Marketing pushes products and services out to the consumer on virtual
shelf space across the Web, creating more opportunities for merchants to
generate sales, for affiliates to earn revenue from their sites, and for
consumers to find the products and services they want on the Web.
Through Affiliate Marketing, merchants can place their advertising banners and
links on content sites worldwide and only pay a commission when those links
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generate a sale or qualified lead. Affiliated content sites can easily convert
their online content into e-commerce by populating it with these
revenue-generating links.
How It Works
With Affiliate Marketing, a merchant recruits content sites to partner with them
as affiliates in exchange for commissions. The merchant provides their
advertising banners and links to their affiliates and assigns a commission for
each click-through to their site, subscription to their service (a lead), or
purchase of their products that is generated from the links. Affiliates place
the tracking code for these ads into their Web pages. Whenever a visitor to the
affiliate's site uses these links to generate a click- through, lead, or sale
for the merchant, that transaction is tracked online. If a product or service is
purchased, the customer pays the merchant directly, and the affiliate is paid a
commission for that transaction.
Why It's Effective
Affiliate Marketing allows you to profit online with your current business or
Web site without the hassle of CPM ad buys and uncertainty about the
effectiveness of your ad dollars. Affiliate Marketing provides results instead
of promises, and Commission Junction gives you all the tools you need to build
and maintain the most successful affiliate and merchant relationships.
Affiliate Marketing with Commission Junction lets you:
- Quickly join and set up a program with our Web-based application
- We intent to work with Commission Junction to Partner with
hundreds of thousands of Web sites worldwide and Manage all of
these marketing relationships seamlessly online
- and receive payments in our currency in one monthly check
- Commission Junction is a trusted third-party tracking and
reporting system.
Presently the Company has two employees and two independent contractors. The two
employees have multiple responsibilities including technology/programmers,
management, clerical and administrative. The two independent contractors are the
sale people for the Company. The Company anticipates that it may employ up to 17
people within the next 12 months: Technology-programmers - 3; Sales - 8;
Administrative - accountant/bookkeeping - 2; Management/Directors - 2; and
Clerical - filing - 2. The Company also outsourcers to independent contractors
for such areas as sales, marketing, accounting, tax, and other services needs.
The Company has not entered into any collective bargaining agreements. The
Company will offer employee stock compensation programs based on performance
(Bonus programs: stock and cash bonus). Other benefits will include health
insurance, life insurance and retirement plans.
I-12
ITEM 2. Description of Property
The Company has a lease to rent 1,049 square feet of office space located at 719
5th Street, Miami Beach, Florida 33139. The Company pays $2,075 per for the
space. The lease expires on November 30, 2002 and the Company has an option to
renew the lease for an additional 2 years.
ITEM 3. Legal Proceedings
The Company is currently not a party to any pending legal proceedings and no
such action by, or to the best of its knowledge, against the Company has been
threatened.
ITEM 4. Submission of Matters to a Vote of Security Holders
On February 4, 2002, a majority of our shareholders, by written consent
without a meeting authorized a 11-1 forward split of the Company's outstanding
common shares.
I-13
PART II
ITEM 5. Market For Common Equity and Other Shareholder Matters.
On April 29, 2002, we had 91 shareholders of record of our common stock. Based
on information received from brokers and others in fiduciary capacities, we
estimate that the total number of shareholders of our common stock does not
exceed 500. Our common stock is available for trading through electronic trading
services via the OTC Bulletin Board. As of December 31, 2001, the Company's
common stock was not traded on the OTC Electronic Bulletin Board, and therefore
there was no public market at such time.
Dividend Policy
The Company has not declared or paid cash dividends or made distributions in the
past, and the Company does not anticipate that it will pay cash dividends or
make distributions in the foreseeable future. The Company currently intends to
retain and reinvest future earnings, if any, to finance its operations.
Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS
The following discussion and analysis should be read in conjunction with the
financial statements of the Company and the accompanying notes appearing
subsequently under the caption "Financial Statements." The following discussion
and analysis contains forward-looking statements, which involve risks and
uncertainties. The Company's actual results may differ significantly from the
results, expectations and plans discussed in these forward-looking statements.
During the past fourteen months, the Company has spent considerable time and
capital resources defining and developing its strategic plan for delivering and
operating its real-time interactive e-commerce technology.
The Company continues managing the marketing launch of its services from its
office in Miami where it currently manages the administration and coordination
for all
its other activities. Such responsibilities include the administration of its
Interactive Online Services and related products to business' websites as well
ass technical support, daily bookkeeping and scheduling of employee
responsibilities. The Company's primary service ClickiChat/Support is
automatically available to its potential customers via Online. Upon receiving an
online order it takes approximately 60 to 120 seconds to process such order and
send back to the new register user an account number, login name and password
with all instructions in order to set-up their new Interactive Online Solution
ClickiChat/Support account. Please visit our sign up page at:
www.liveinternethelp.com/signup.htm.
II-1
The Company launched its service July 1st 2001. The Company intends to continue
attracting new marketing partners to continue increasing the brand name of its
services and continue increasing its customer base. In addition, the Company
intends to continue its ongoing marketing campaign for the following 12 months.
Currently, the Company spends approximately $15,000 per month. In order to fund
the Company, the officers and directors of the Company will continue making
capital contributions to the Company for the next 6 (six) months. Startcall
expects to start generating revenues as soon as August 2002 and estimates that
it will have close to or over 1,000 paying customers by August 15th 2001. At the
minimum income per customer of $29.95, the Company should be generating
sufficient funds to cover its current monthly expenses. The Company anticipates
that it will continue adding new services to its service menu with any potential
new services related to its market area.
There are currently over 8,000 ISP and web-hosting companies in the United
States. The regional nature of their business usually creates a fixed customer
base and margin sensitive business. StartCall intends to capitalize on these
conditions by offering the ISP a simple, effective way to:
1) Add an additional revenue stream that is nearly risk free and
extremely high margin;
2) Offer a set of services that allows them to differentiate
themselves from the competition; and
3) Promote themselves as a business that cares about consumer
privacy and control on the Internet.
Because StartCall hosts ClickiChat/Support, ISPs will have no internal knowledge
transfer or set-up costs. They simply sign-up as a partner, up-sell to their
clients, and start receiving royalty checks.
Another rapidly growing segment of the e-CRM market is web-based customer
interaction ("WCI"). The WCI market is built upon the premise that
relationships, by their very nature, require a two-way communication. WCI
focuses on translating the traditional web based experience of a human
interacting with a computer into a human interacting with a human over an
electronic medium. WCI software sales are expected to reach $1.8 billion by
2004.
The Company does not foresee purchasing any major equipment or changes on the
number of employees for the next 6 months. The Company feels that once it
reaches approximately 10,000 customers, new positions will be available in the
areas of customer service, marketing and business development.
II-2
The Company anticipates that it will raise additional funding once it reaches
10,000 customers within the next twelve (12) months.
Development Stage Revenues
--------------------------
The Company's operations have been devoted primarily to designing its business
and marketing plans and building an infrastructure. The ability of the Company
to achieve its business objectives is contingent upon its success in raising
additional capital until adequate revenues are realized from operations.
Development Stage Expenses
--------------------------
Development stage expenses during the fourteen-month period primarily consisted
of accounting, legal, consulting and office expenses which are necessitated by
operating in a public environment. Ongoing increases to development stage
expenses are anticipated during the year 2001.
Liquidity and Capital Resources
-------------------------------
Despite capital contributions and related party loans, the Company from time to
time experienced cash flow shortages that have slowed the Company's growth.
Through December 31, 2001, the consequences of those cash flow shortages has
been an increase of accrued expenses and stockholder loans bringing those
amounts to approximately $62,000 and $148,000, respectively.
The Company has primarily financed its activities from sales of capital stock of
the Company and from loans from its shareholders. A significant portion of the
funds raised from the sale of capital stock has been used to cover working
capital needs such as office expenses and various consulting and professional
fees.
The Company continues to experience cash flow shortages, and anticipates this
continuing through the foreseeable future. Management believes that additional
funding will be necessary in order for it to continue as a going concern. The
Company is investigating several forms of private debt and equity financing,
although there can be no assurances that the Company will be successful in
procuring such financing or that it will be available on terms acceptable to the
Company.
II-3
Item 7 FINANCIAL STATEMENTS
STARTCALL.COM, INC.
(A Development Stage Enterprise)
AUDITED FINANCIAL STATEMENTS
December 31, 2001 and 2000
and
the years ended December 31, 2001 and 2000
and for the period
October 19, 1999 (Date of Inception)
through December 31, 2001
STARTCALL.COM, INC.
(A Development Stage Enterprise)
AUDITED FINANCIAL STATEMENTS
December 31, 2001 and 2000
and
the years ended December 31, 2001 and 2000
and the period
October 19, 1999 (Date of Inception) through December 31, 2001
INDEX TO AUDITED FINANCIAL STATEMENTS
Page
----
Report of Independent Accountants ......... 2
Balance Sheets ............................ 3
Statements of Operation ................... 4
Statement of Changes in Stockholders Equity
(Deficiency) ........................... 5
Statements of Cash Flows .................. 6
Notes to the FInancial Statements ......... 7-21
Jewett, Schwartz & Associates
Certified Public Accountants Charles E. Jewett, C.P.A.
============================= Michael A. Schwartz, C.P.A.
Lawrence H.Wolfe, C.P.A., C.V.A.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders
Startcall.com, Inc.
Miami, FL
We have audited the accompanying balance sheets of Startcall.com, Inc. ( A
Development Stage Enterprise) (the "Company") as of December 31, 2001 and 2000
and the related statements of operations, changes in stockholders' (deficiency)
equity, and cash flows for the years ended and for the period October 19, 1999
(Date of Inception) through December 31, 2001. 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 have conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects the financial position of Startcall.com, Inc. as of
December 31, 2001 and December 31, 2000 and the results of its operations and
its cash flow for the periods then ended in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. As discussed in Note A to the financial
statements, the Company is a development stage enterprise that has not commenced
its planned principle operations and is reporting accumulated losses since
Inception that total approximately $492,000. Accordingly, the Company's ability
to continue as a going concern is dependent on its ability to, among other
things, obtain additional debt and equity financing, identify customers and
secure vendors and suppliers, and establish an infrastructure for its planned
operation. Management's plans in regards to these matters are also described in
Note A. These financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ Jewett, Schwartz & Associates
April 29, 2002
Hollywood, FL
-2-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
BALANCE SHEETS
As of December 31,
------------------
2001 2,000
-------- ------
ASSETS
CURRENT ASSETS
Cash $ - $ -
Due from shareholder - 4,327
Prepaid expenses 25,000 30,419
-------- ------
TOTAL CURRENT ASSETS 25,000 34,746
PROPERTY AND EQUIPMENT 14,382 27,647
OTHER ASSETS 4,355 4,355
-------- ------
TOTAL ASSETS $ 43,737 66,748
======== ======
LIABILITIES AND SHAREHOLDERS' (DEFICIENCY)
LIABILITIES
CURRENT LIABILITIES
Checks drawn in excess of cash balance $ 6,925 $ 11,288
Current portion notes payable -
related parties 148,181 2,760
Accounts payable and
accrued expenses 61,575 65,903
-------- ------
TOTAL CURRENT LIABILITIES 216,681 79,951
LONG-TERM DEBT - related parties,
net of current portion - 75,000
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' (DEFICIENCY) (172,944) (88,203)
-------- ------
TOTAL LIABILITIES AND
STOCKHOLDERS' (DEFICIENCY) EQUITY $ 43,737 $ 66,748
======== ======
See Accompanying report of independent accountants and
notes to financial statements.
-3-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
STATEMENTS OF OPERATIONS
For the periods ended
-----------------------------------------------------
October 19,
1999
Years ended (Inception)
-------------------------------- through
December 31, December 31, December 31,
2001 2000 2001
--------- --------- ---------
REVENUES $ 3,471 $ 7,162 $ 10,633
--------- --------- ---------
OPERATING EXPENSES
Organization -- -- 5,554
General and administrative 88,212 280,347 388,173
Research and development -- 60,263 69,319
Marketing and promotional -- 38,517 39,431
--------- --------- ---------
TOTAL OPERATING EXPENSES 88,212 379,127 502,477
--------- --------- ---------
LOSS BEFORE INCOME TAX BENEFIT (84,741) (371,965) (491,844)
INCOME TAX BENEFIT, net -- -- --
--------- --------- ---------
NET LOSS $ (84,741) $(371,965) $(491,844)
========= ========= =========
Loss per share of common stock - Basic and Diluted $ -- $ (0.02) $ (0.02)
========= ========= =========
See Accompanying report of independent accountants and
notes to financial statements.
-4-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
STATEMENT OF CHANGES IN STOCKHOLDERS' (DEFICIENCY) EQUITY
Common Stock
------------------------------------
Transaction Shares Stock
Date Issued Par Value Subscribed
---- ------ --------- ----------
BALANCE - October 19, 1999
Common stock subscriptions received October 19, 1999 $ 1,000
Common Stock issued in consideration for
Legal Expense paid by stockholder October 20, 1999 240 $ 240 (240)
Common stock issued for cash November 16, 1999 50 50 (50)
Common stock issued in consideration for
Purchase of property and equipment
by a stockholder November 17, 1999 490 490 (490)
Common stock issued in consideration for
Purchase of property and equipment
by a stockholder November 17, 1999 220 220 (220)
Net loss for the period October 19, 1999
(Inception) through December 31, 1999
--------- ------- -------
BALANCE - DECEMBER 31, 1999 1,000 1,000 $ -
Common Stock - Restricted- par value July 1, 2000 1,499,950 $ 1,000
$.000666 per share, 1,499,950 shares
authorized, issued and outstanding
Common Stock, par value $.000666 per share, July 26, 2000 707,500 $ 472
707500 shares authorized, issued and
outstanding
Net loss for the period January 1, 2000
Through December 31, 2000
--------- ------- -------
BALANCE - DECEMBER 31, 2000 2,207,450 $ 1,472 $ -
--------- ------- -------
Net loss for the period January 1, 2001
Through December 31, 2001
--------- ------- -------
BALANCE - DECEMBER 31, 2001 2,207,450 $ 1,472 $ -
========= ======= =======
Common
Stock Additional Deficit Accumulated
Subscriptions Paid-In During the
Receivable Capital Development Stage Total
---------- ------- ----------------- -----
BALANCE - October 19, 1999 $(1,000) $ -
Common stock subscriptions received
240 $ 2,260 2,500
Common Stock issued in consideration for
Legal Expense paid by stockholder October 20, 1999 50 19,950 20,000
Common stock issued for cash
Common stock issued in consideration for 490 7,910 8,400
Purchase of property and equipment
by a stockholder
Common stock issued in consideration for 220 4,780 5,000
Purchase of property and equipment
by a stockholder
(35,138) (35,138)
Net loss for the period October 19, 1999 ----- --------- ---------- ---------
(Inception) through December 31, 1999
$ - $ 34,900 $ (35,138) $ 762
BALANCE - DECEMBER 31, 1999
Common Stock - Restricted- par value
$.000666 per share, 1,499,950 shares
authorized, issued and outstanding $ 282,528 283,000
Common Stock, par value $.000666 per share,
707500 shares authorized, issued and
outstanding
(371,965) (371,965)
Net loss for the period January 1, 2000 ----- --------- ---------- ---------
Through December 31, 2000
$ - $ 317,428 $ (407,103) $(88,203)
----- --------- ---------- ---------
BALANCE - DECEMBER 31, 2000
(84,741) (84,741)
Net loss for the period January 1, 2001 ----- --------- ---------- ---------
Through December 31, 2001
$ - $ 317,428 $ (491,844) $(172,944)
===== ========= ========== =========
BALANCE - DECEMBER 31, 2001
See Accompanying report of independent accountants and
notes to financial statements.
-5-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH
For the periods ended
--------------------------------------------------------------
October 19,
1999
Years ended (Inception)
----------------------------------- through
December 31, December 31, December 31,
2001 2000 2001
---- ---- ----
Cash Flows From Operating Activities
Net loss $ (84,741) (371,965) (491,844)
Adjustments to reconcile net loss to net
cash used by operating activities
Depreciation 13,265 13,154 28,677
(Increase) in prepaid assets 5,419 (30,419) (25,000)
(Decrease) in accounts payable 0
and accrued expenses (4,328) 52,660 60,681
--------- --------- ---------
Total adjustments 14,356 35,395 64,358
--------- --------- ---------
Net Cash Provided (Used) by Operating Activities (70,385) (336,570) (427,486)
--------- --------- ---------
Cash Flows From Investing Activities
Security deposits paid -- (4,355) (4,355)
Advances to shareholder -- (2,427) (4,327)
Purchases of fixed assets -- (420) (12,520)
--------- --------- ---------
Net Cash Provided (Used) by Investing Activities 0 (7,202) (21,202)
--------- --------- ---------
Cash Flows From Financing Activities
Issuance of common stock -- 283,000 303,000
Proceeds from shareholder loans 6,998
Net proceeds from notes payable -
related parties 74,748 48,143 131,765
--------- --------- ---------
Net Cash Provided (Used) by Financing Activities 74,748 331,143 441,763
--------- --------- ---------
NET INCREASE (DECREASE) IN CASH 4,363 (12,629) (6,925)
CASH (OVERDRAFT) AT BEGINNING OF PERIOD (11,288) 1,341 --
--------- --------- ---------
OVERDRAFT AT END OF PERIOD $ (6,925) $ (11,288) $ (6,925)
========= ========= =========
See Accompanying report of independent accountants and
notes to financial statements.
-6-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Summarized below are the significant accounting policies of STARTCALL.COM, INC.
The Company: STARTCALL.COM, INC. (the "Company"), incorporated in the State of
-----------
Florida effective October 19, 1999 (Date of Inception), established its
corporate offices in Miami, Florida.
On June 7, 2000, the Company filed an amendment to the Articles of Incorporation
effecting a name change to STARTCALL.COM, INC., and changed its capital
structure as disclosed in Note G to these financial statements.
Because the Company meets the criteria of a development stage enterprise, as
discussed more fully below, these financial statements are presented in
accordance with Statements of Financial Accounting Standards ("SFAS") Number 7,
Accounting and Reporting by Development Stage Enterprises".
Nature of the Business: The Company plans on operating as an Application Service
----------------------
Provider, or ASP, and offering real-time interaction technology as an outsource
service. Management is in the process of establishing a viable solution to
real-time access to commerce business over the Internet. The Company plans to
offer these businesses the opportunity to improve their online customer care
service capabilities by placing an internet voice box and a Text Chat button
with a URL push feature on the websites of some of these potential domestic and
international business customers. These tools should not only provide the
visitors and customers of a particular website live help at the crucial point of
purchase, but they should also facilitate other types of needed assistance.
Development Stage Enterprise: The Company is currently devoting substantially
----------------------------
all of its efforts to establishing a new business and its planned principle
operations have not commenced as of December 31, 2001. In their efforts to
establish a new business, management is commencing with design of its business
and marketing plans that include the following: preparation of a financial plan,
cash forecast and operating budget; identifying markets to raise additional
equity capital and debt financing; embarking on research and development
activities; performing employment searches, recruiting and hiring technicians
and management and industry specialists; acquiring operational and technological
assets; and, developing market and distribution strategies. General and
administrative expenses include professional fees, internet service charges, and
other related operating expenses. Marketing and promotional expenses include
costs incurred in connection with raising capital and promoting the Company.
-7-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
Research and Development Costs: Generally accepted accounting principles state
------------------------------
that costs that provide no discernible future benefits, or allocating costs on
the basis of association with revenues or among several accounting periods that
serve no useful purpose, should be charged to expense in the period occurred.
Since the Company is in its development stage, SFAS No. 2 "Accounting for
Research and Development Costs" requires that certain costs be charged to
current operations including, but not limited to: salaries and benefits;
contract labor; consulting and professional fees; depreciation; repairs and
maintenance on operational assets used in the production of prototypes; testing
and modifying product and service capabilities and design; and, other similar
costs.
Basis of Presentation: In accordance with SFAS No.7, the Company's policy
---------------------
regarding the preparation of these financial statements includes the presenting,
in addition to its statements of operations, changes in stockholders'
(deficiency) equity and cash flows, the cumulative amounts of revenues and
expenses, stockholder equity transactions and cash flows since Inception through
December 31, 2001.
The Company's independent accountants are including a "going concern" paragraph
in their review report accompanying these financial statements that cautions the
users of the Company's financial statements that these statements do not include
any adjustments that might result from the outcome of this uncertainty because
the Company is a development stage enterprise that has not commenced its planned
principal operations. Furthermore, the "going concern" paragraph states that the
Company's ability to continue is also dependent on its ability to, among other
things, obtain additional debt and equity financing, identify customers, secure
vendors and suppliers, and establish an infrastructure for its operations.
Even though the Company has not commenced planned principal operations or
generated revenues from prospective customers nor has it secured the funding
necessary to meet its current working capital needs, management believes that,
despite the extent of the financial requirements and funding uncertainties going
forward, it has under development a business plan that, if successfully funded
and executed as an integral part of a financial structuring, the Company can
overcome the concerns of the independent accountants within the next twelve
months.
-8-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
Management continues to actively seek various sources and methods of short and
long-term financing and support; however, there can be no assurances that some
or all of the necessary financing can be obtained. Management continues to
explore alternatives that include seeking strategic investors, lenders and/or
technology partners and pursuing other transactions that, if consummated, might
ultimately result in the dilution of the interest of the current stockholders.
Because of the nature and extent of the uncertainties, many of which are outside
the control of the Company, there can be no assurances that the Company will be
able to ultimately consummate planned principal operations or secure the
necessary financing.
Start-up Costs: Cost incurred in connection with commencing operations,
--------------
including general and administrative expenses, are charged to operations in the
period incurred.
Revenue Recognition: The Company recognizes revenues upon the delivery of a
-------------------
product or service. Installation, maintenance and service fees paid in advance
by customers are initially recorded as deferred revenues and subsequently
amortized over the life of their respective contract periods.
Property and Equipment: Property and equipment are stated at cost. Depreciation
----------------------
and amortization are provided in amounts sufficient to relate the cost of
depreciable assets to operations over their estimated service lives. When
applicable, leasehold improvements and capital leases are amortized over the
lives of respective leases, or the service lives of the improvements, whichever
is less.
The straight-line method of depreciation is used for financial reporting
purposes.
The estimated useful lives, of property and equipment, are as follows:
YEARS
Computer equipment, peripherals and software 2-3
Office equipment 3-5
Furniture and fixtures 5-7
Expenditures for renewals and improvements that significantly extend the useful
life of an asset are capitalized. The costs of software used in the business
operations are capitalized and amortized over their expected useful lives.
Expenditures for maintenance
-9-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
and repairs are charged to operations when incurred. When assets are sold or
retired, the cost of the asset and the related accumulated depreciation are
removed from the accounts and any gain or loss is recognized at such time.
Earnings Per Common Share: In calculating earnings per common share, basic
-------------------------
earnings per share is computed by dividing net income (loss) by the weighted
average number of common shares outstanding, excluding the diluted effects of
stock options.
Use of Estimates: In preparing financial statements in conformity with generally
----------------
accepted accounting principles, management is required to make estimates and
assumptions that affect the reported amounts of assets and liabilities and the
disclosure of contingent assets and liabilities at the date of the financial
statements and revenues and expenditures during the reported periods. Actual
results could differ materially from those estimates. Estimates may include, but
not be limited to, those pertaining to the estimated useful lives of property
and equipment and software, determining the estimated net realizable value of
receivables, and the realization of deferred tax assets.
Stock-Based Compensation: The Company will account for stock-based compensation
------------------------
using the intrinsic vale method prescribed in Accounting Principles Board
Opinion No. 25, "Accounting for Stock Issued to Employees". Compensation costs
for stock options, if any, are measured as the excess of the quoted market price
of the Company's stock at the date of grant over the amount the employee must
pay to acquire the stock. Restricted stock is recorded as compensation costs
over the requisite vesting periods based on the market value on the date of
grant. Compensation costs for shares issued under performance share plans are
recorded based upon the current market value of the Company's stock at the end
of each period.
Statement of Financial Accounting Standards ("SFAS") No. 123, "Accounting for
Stock-Based Compensation", established accounting and disclosure requirements
using a fair-value-based method of accounting for stock-based employee
compensation plans. The Company is electing to use APB Opinion No. 25 as its
method of accounting and is adopting the disclosure requirements of SFAS No.
123.
The fair value of each option grant is to be estimated on the date of
grant using the Black-Scholes option pricing model and certain weighted-average
assumptions. As of December 31, 2001 no options have been granted.
-10-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
Risks and Uncertainties: Management regularly evaluates risks and uncertainties
-----------------------
and, when probable that a loss or expense will be incurred, a charge to current
period operations is recorded.
Even though the Company does not have sufficient assets and liquidity, the
Company's management has elected to self-insure the Company against losses, if
any, that might be otherwise insurable if the Company maintained business
insurance including; business interruption; property, wind and flood; general
and automobile liability; errors and omissions; and, officers and directors
coverage. From inception through December 31, 2001, management is not aware of
any event, transaction or matter that requires disclosure and/or adjustment to
these financial statements with respect to uninsured losses, except as many
otherwise be disclosed in these footnotes. However, because of the current
financial condition of the Company, should any uninsured claim or loss occur,
the ability of the Company to continue might be adversely effected.
Additionally, the Company has agreed, as set forth in its By-Laws, to indemnify
to the fullest extent permitted or authorized by current or future legislation,
judicial or administrative decision, all past and present employees, agents,
directors, officers and representatives against any fine, liability, cost or
expense asserted against them or incurred by them in the above capacities.
Because of the rapid evolution of the industry in which the Company operates,
its ability to operate may be adversely effected by future changes in Federal
and state regulations.
Income Taxes: On December 29, 1999, the stockholders holding a majority of the
------------
shares of the Company's issued and outstanding shares voted to terminate its
S-election with the Internal Revenue Service, with an effective date retroactive
to October 19, 1999.
The Company
recognizes deferred tax assets and liabilities based on differences between the
financial reporting and tax bases of assets and liabilities using the enacted
tax rates and laws that are expected to be recovered. The Company provides a
valuation allowance for deferred tax assets for which it does not consider
realization of such assets to be more likely than not.
-11-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE B - OFFERING MEMORANDUM
The Company filed a Form U-7 SCOR Offering Memorandum, on July 26, 2000, under
Regulation D promulgated under the Securities Act of 1933, as amended. However,
this share offering was not registered under the 1933 Act, or the securities
laws of any state. The Offering was made available for sale in Nevada and, in
order to meet the conditions for exemption from the registration requirements
under the securities laws of certain jurisdictions, accredited investors who are
residents of such jurisdiction will be required to meet certain suitability
requirements.
The Company planned on offering a maximum of 706,750 shares of the Company's
$.000666 par value common stock at an offering price of $.40 per share. However,
the actual amount of shares sold was 707,500. The issuance of these shares has a
dilutive effect on the book value per share of the Company's common stock. The
total amount of gross proceeds realized on the Offering totaled $283,000.
This Offering was made on an "all-or-none basis" utilizing subscription
agreements containing the applicable terms, conditions and requirements; there
are no underwriters; and, the Company was required to maintain on deposit with
an escrow agent the proceeds from the Offering equaling twenty-five (25%)
percent of the total gross proceeds until all of the securities under this
Offering are sold.
NOTE C - PROPERTY AND EQUIPMENTAt
December 31, property and equipment consists of the following:
2001 2000
------------------- -------------------
Computer equipment, peripherals
and software $ 34,896 $ 34,896
Office equipment 8,162 8,162
------------------- -------------------
Less: accumulated depreciation (28,675) (15,411)
------------------- -------------------
TOTAL $ 14,383 $ 27,647
=================== ===================
-12-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE D - NOTES PAYABLE - RELATED PARTIES
At December 31, notes payable to related parties consists of the following:
2001 2000
--------------------- ------------------
10% Unsecured loans payable to shareholder
Due on demand $ 1,760 $ 2,760
8% Unsecured notes payable to shareholders
Interest begins accruing on June 1, 2000
Principal and interest due on August 30,
2002 146,421 75,000
--------------------- ------------------
TOTAL 148,181 77,760
Less: Current portion (148,181) (2,760)
--------------------- ------------------
TOTAL $ - $ 75,000
===================== ==================
NOTE E- TRANSACTIONS WITH AFFILIATE AND STOCKHOLDER
In connection with the start-up of the Company, certain general and
administrative, marketing and promotion costs, and research and development
costs, charged to operations, were paid on behalf of the Company, as summarized
below:
Years ended December 31 Inception
-------------------------------------------- through
2001 2000 December 31, 2001
-------------------- ------------------- ------------------
Affiliate $ - $ - $ 8,874
Stockholders - $ - $ 6,998
---------- ---------- ----------------
TOTAL $ - $ - $ 15,872
========== ========== ================
-13-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE E- TRANSACTIONS WITH AFFILIATE AND STOCKHOLDER - Continued
In addition, summarized below is the non-cash investing and financing activities
with related parties:
Years ended Inception
------------------------------------------ through
December 31, 2001 December 31, 2000 December 31, 2001
------------------- -------------------- -------------------
Affiliate:
Funds advanced for the purchase
of property and equipment. $ - $ - $ 13,745
------------------- -------------------- -------------------
Stockholders:
Stockholders issued promissory
notes in connection with their
direct payment to vendors for the
purchase of property and
equipment. $ - $ - 2,500
Stockholders issued common
stock in connection with their
direct payment to vendors for
the purchase of property and
equipment. - - 13,400
------------------- -------------------- -------------------
TOTAL STOCKHOLDERS - - 15,900
------------------- -------------------- -------------------
TOTAL AFFILIATE AND
STOCKHOLDERS $ - $ - $ 29,645
=================== ==================== ===================
The Affiliate is owned 100% by a majority stockholder of the Company.
-14-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE F - STOCKHOLDERS' EQUITY
The Articles of Incorporation, initially filed with the State of Florida,
authorize only one class of stock: 1000 shares of one ($1.00) dollar par value
common stock. The holders of these shares of common stock do not have cumulative
voting rights. Shares are not issued until paid for in full.
On June 7, 2000, the Board of Directors approved an amendment to the Articles of
Incorporation, authorizing the Company to issue up to 50,000,000 shares of
$.000666 par value common stock. On June 29, 2000, the 1000 previously issued
and outstanding shares of the $1.00 par value common stock were tendered by each
shareholder and cancelled. In exchange for the tendered shares, on July 1, 2000
the Company issued 1,499,950 shares of its $.000666 par value stock that
resulted in a dilution of the Company's book value per share.
As more fully disclosed in Note B to these financial statements, the Offering
Memorandum provides for the sale of an additional 707,500 shares of the
Company's $.000666 par value common stock at a price of $.40 per share.
In February, 2002, the Board of Directors approved an 11-1 forward split of the
Company's outstanding stock. The per share computation described in Note I,
reflects this split.
NOTE G - COMMITMENTS
Summarized below are certain contracts and agreements executed by the Company
from October 19, 1999 (Inception) through December 31, 2001.
License and Distribution Agreement and the End-User License Agreement: On
---------------------------------------------------------------------
October 19, 1999, the Company ("Licensee"), entered into a License and
Distribution Agreement and an End-User License Agreement, herein collectively
referred to as the "License Agreement" with an unrelated third party
("Licensor"). The Licensor grants the Licensee a perpetual, nonexclusive,
non-transferable license to use certain software solely for the Licensee's
business purpose, without further re-selling or distribution, except the
Licensee may duplicate and distribute the software to end-user customers. The
Licensee may also use the Licensor's trade names and trademarks. The media
containing the software is subject to a 90-day warranty, but the Licensor does
not warrant its software. The fee structure associated with this agreement is
disclosed in the Distribution Partner Agreement described below.
-15-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE G - COMMITMENTS - Continued
Distribution Partner Agreement: On June 14, 2000, the Company executed a
------------------------------
Distribution Partnership Agreement (the "Distribution Agreement") with the
unrelated third party Licensor. The Distribution Agreement provides that the
Company distribute to its customers, the Licensor's web-to-phone Internet
telephony and multimedia services.
The Company, at its expense, is responsible for providing the first level of
technical support to its customers relating to the use of the Licensor's
software and services, subject to the terms of the Licensor's standard support
agreement and, the License and Distribution Agreement and the End-User License
Agreement, disclosed in the preceding paragraph of these financial statements.
The Licensor has agreed to provide the second level of technical support to the
Company's customers, subject to the terms of its standard support agreement.
The Distribution Agreement sets forth a combination of one or more of the
following fee structures: (a) Session Pricing--Connection costs per "customer
session" subject to various volume levels; (b) Minimum Volume
Commitments--Twelve (12) non-refundable minimum monthly payments by the Company
of one thousand ($1,000.00) dollars to be applied to the first one thousand of
monthly charges with no carryover if the minimum is not met. The entire amount
of twelve thousand ($12,000) dollars is payable in advance upon execution of the
Distribution Agreement; (c) Programming Fees--The Company is subject to a fifty
($50) dollar one-time "start-up" fee per customer. The Distribution Agreements
are for a one (1) year term and are subject to automatic one-year renewals
unless terminated by either party with thirty (30) days written notice prior to
the expiration of the then-effective term. The $12,000 fee was paid in June
2000. At December 31, 2001 this fee is included in general and administrative
expense.
The Distribution Agreements may also be terminated by either party with seven
(7) days prior written notice in the event of an occurrence of certain defined
events, including a material breach of the terms and conditions therein.
Dealer/Promoter Agreements: During 2000, the Company executed various
--------------------------
non-exclusive agreements whereby these independent contractors agree to use
their best efforts to cause end-users to purchase the Company's services. During
the terms of these Agreements, the Company has agreed to pay the
Dealer/Promoters a commission in accordance with the established schedules, as
more fully described in each of the duly executed original service agreements.
These Agreements expire under various criteria
-16-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE G - COMMITMENTS - Continued
ranging from the earlier of Nine (6) to twelve (12) months, or the sale of two
(2000) to five (5,000) thousand accounts of ClickIChat and/or ClickICall
services. The Agreements are renewable under certain conditions and may be
cancelled by either party with thirty (30) days advance written notice.
The Agreements, among other things, set forth certain performance, compensation
and charge-back provisions as follows:
CLICKICHAT SERVICE: (a) Performance Standards- - The Dealer/Promoters must
sell Chat Licenses at a minimum standard price per month based on sessions,
plus the installations fees, and at the defined minimum sales levels for
the number of new subscribers and billing revenues; (b) Compensation- - The
Dealer/Promoters will be paid commissions ranging between fifteen (15%) and
twenty (20%) percent of the total sales they generate and an additional
thirty-three and one-third (33 1/3%) percent of the installation fees when
the sales are deemed "qualified" under the terms of these Agreements.
CLICKICALL SERVICE: (a) Compensation --The Dealer/Promoters will be paid
commissions ranging between fifteen (15%) and twenty (20%) percent of the
total sales they generate and an additional thirty-three and one-third (33
1/3%) percent of the installation fees when the sales are deemed
"qualified" under the terms of these Agreements. (b) Duration--The
compensation schedules are, in effect, the earlier that a certain number of
accounts are sold or the expiration of the stated contract periods, at
which time the parties agree to renegotiate the various fee provisions. The
Company may charge-back the Dealer/Promoters for uncollectible accounts of
customers, but only to the extent of the amount of subsequent fees earned
by the Dealer/Promoters.
One agreement requires the Company to maintain a prepaid commission balance of
$25,000, included in prepaid assets, to offset against the dealer's share of
revenues. The Company is required to pay an additional deposit upon the sooner
of acquiring 1000 customers or reaching a zero balance.
Employment Agreements: Effective July 1, 2000, the Company extended three-year
---------------------
employment agreements to two of its officers, who are also stockholders of the
Company. These agreements, among other things, contain certain provisions
relating to: nondisclosure and development; protecting licensed materials;
non-compete and non-solicitation restrictions. The annual compensation for one
officer totals $120,000,
-17-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE G - COMMITMENTS - Continued
$180,000 and $195,000 and the other totals $85,000, $140,000 and $195,000 for
each of the twelve (12) month periods ending December 31, 2003, 2004 and 2005,
respectively, or upon the Company commencing operations, whichever is sooner.
Lease Agreement: The Company conducts its operations from facilities that are
---------------
leased under a two-year lease agreement expiring on September 14, 2002. There is
an option to renew for an additional two years at an increased monthly rental.
Under the lease agreement the Company is subject to additional charges related
to their proportionate share of operating expenses as well as maintaining
minimum levels of insurance coverage.
Future minimum lease payments required under this lease as of December 31, 2001
are as follows:
Year
----
2002 $ 25,000
---------
Total minimum lease payments $ 25,000
=========
Rent expense was approximately $33,000 and $25,000 for the years ended December
31, 2000 and 2001, respectively and approximately $65,000 for the period of
inception through December 31, 2001.
Stock Compensation Plans: On December 29, 1999, the Board of Directors approved
------------------------
the adopting of three stock option plans that will provide for the granting of
stock options to officers and key employees. The objectives of these plans
include attracting and retaining the quality personnel, providing for additional
performance incentives, and promoting the success of the Company by providing
employees the opportunity to acquire the common stock of the Company. In
connection with these plans, the Company is authorized to grant options up to
714,285 shares. Options to be granted under these plans will be at prices, which
are either equal to or above the market value of the stock on the date of grant,
vest over two-, three-and four-year periods, and expire ten years after the
grant dates.
-18-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE G - COMMITMENTS - Continued
The Company will account for stock-based compensation using the intrinsic value
method prescribed by Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees", under which no compensation cost for stock options
is recognized for stock option awards granted at or above fair market value. If
the compensation expense for the Company's three stock-based plans are
determined based upon fair values at the grant dates for awards under these
plans in accordance with SFAS No. 123, "Accounting for Stock-Based
Compensation", the Company's net earnings and with earnings per share will be
reduced to pro forma amounts to be disclosed in the financial statements for the
applicable periods.
As of December 31, 2001, the Company has not granted any stock options or
rights.
NOTE H- CONTINGENCIES
Going Concern: As discussed previously in Note A to these financial statements,
-------------
uncertainties exist with respect to the Company's ability to continue as a going
concern.
Lack of Insurance: As previously discussed in these financial statements, the
-----------------
Company does not maintain any insurance coverage and the Company therefore, is
in violation of certain agreements. Upon receipt of the net proceeds, if any,
from the Offering Memorandum discussed in Note B to these financial statements,
management intends to secure the necessary insurance coverage. No estimates have
been made as to the amounts that may be required should an unexpected loss occur
and, accordingly, no accruals have been made in these financial statement for
self-insurance reserves that might be necessary.
NOTE I- EARNINGS (LOSS) PER SHARE OF COMMON STOCK
Statement of Financial Accounting Standards No 128, "Earnings Per Share,"
requires two presentations of earnings (loss) per share - "basic" and "diluted."
Basic earnings per share is computed by dividing income available to common
stockholders (the numerator) by the weighted-average number of common shares
(the denominator) for the period. The computation of diluted earnings (loss) per
share is similar to basic earning per share, except that the denominator is
increased to include the number of additional common shares that would have been
outstanding if the potentially dilutive common shares had been issued. The
numerator in calculating both basic and diluted earnings (loss) per share for
each period is the reported net income (loss). The denominator is based on the
-19-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE I- EARNINGS (LOSS) PER SHARE OF COMMON STOCK- Continued
following weighted-average number of common shares outstanding for each of the
respective periods:
October 19, 1999
(Inception) through
December 31, 2000 December 30, 2001 December 31, 2001
--------------------------- ------------------------ -------------------------
18,750,285 24,281,950 21,640,345
========== ========== ==========
A difference between basic and diluted weighted-average common shares arises
from the assumption that dilutive stock options outstanding, if any, are
exercised. Stock options and warrants are not included in the diluted earnings
(loss) per share calculation when the exercise price is greater than the average
market price. The Company does not have any stock options outstanding as of
December 31, 2001.
NOTE J - INCOME TAXES
As previously discussed, the stockholders elected to terminate, retroactively to
October 19, 1999, the S-Corporation income tax filing status for the Company.
The stockholders have filed with the Internal Revenue Service, a letter of
request for retroactive termination, accompanied by the Statement of Consent to
Revocation of Election signed by the stockholders. The Company is confident that
the IRS will grant the Company's request to be a C corporation and, accordingly,
these financial statements are prepared under the SFAS No. 109, "Accounting for
Income Taxes".
The Company did not provide any current or deferred US federal or state income
tax provision or benefit for any of the periods presented because it has
experienced operating losses since inception. The Company has provided a full
valuation allowance on the deferred tax asset, consisting primarily of a net
operating loss, because of the uncertainty regarding its realizability.
At December 31, 2001 the Company had a net operating loss carryforward of
approximately $492,000. Utilization of these net operating losses, which begin
to expire in year 2019, may be subject to certain limitations under section 382
of the Internal Revenue Code of 1986, as amended, and other limitations under
state tax laws.
-20-
STARTCALL.COM, INC.
(A Development Stage Enterprise)
NOTES TO FINANCIAL STATEMENTS
December 31, 2001 and 2000
And
For the years then ended and
for the period October 19, 1999 (Date of Inception) through December 31, 2001
NOTE J - INCOME TAXES - Continued
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's deferred tax assets at June 30 are approximately as follows:
2001 2000
---------------- ----------------
Net operating loss carryforward $ 192,500 $ 153,000
Valuation allowance for deferred tax assets. (192,500) (153,000)
---------------- ----------------
Net deferred tax assets $ - $ -
================ ================
-21-
PART III
ITEM 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with Section 16(a) of the Exchange Act.
The members of the Board of Directors of the Company serve until the next annual
meeting of stockholders, or until their successors have been elected. The
officers serve at the pleasure of the Board of Directors.
The current executive officers, key employees and directors of the Company are
as follows:
Name Age Position
---- --- --------
Antonio Treminio 31 President, Chief
Executive Officer and Director
Sylvio Martini 27 Chief Operating Officer
and Director
Antonio Treminio has been President, Chief Executive Officer and Director
of the Company since inception. As the Chief Executive Officer and President of
StartCall.com, Inc., Mr. Treminio's responsibilities include managing the
overall operations, the direction of the company's business strategies, and
strategic alliances. Mr. Treminio directed a public relations firm in Miami,
Florida called SEM Capital from June, 1997 to September, 1999, which
successfully represented Rica Foods, Inc., the largest publicly traded company
in the Caribbean and Central America with over 120 million dollars in annual
sales (www.ricafoods.com) (ASE: RCF). He assisted Rica Foods, Inc. in their
marketing campaign to increase its market name recognition among the Wall Street
community and as result the company's stock was ranked 7th in performance in
1998 by the Miami Herald, Florida Stocks.
He commenced employment with Midland Walwyn, Inc. an Investment Banking &
Brokerage firm in Toronto, Canada (Today known as Merrill Lynch, Canada Ltd.
From Summer 1993 till Dec. 1993). He relocated to the United States and was
employed by Dean Witter Reynolds in early 1994, with a focus in establishing
referral agreement programs with Latin American financial institutions. Mr.
Treminio attended The Loyalist College Business School in Ontario, Canada from
1989 through 1993.
III-1
Sylvio Martini has been the Chief Operating Officer and Director of the Company
since inception and is in charge of the Internet application development, web
design, and programming for the Company. Mr Martini has over 5 years experience
in the Internet consulting industry and development of e-commerce Web sites. He
was employed with Quad International, Inc. February 1997, - December 1999. His
responsibilities were web design, project coordinator, and marketing of online
store . Responsible for maintenance and upgrades of a membership website with
over 15,000 members. He received his Bachelor of Computer Science from the
University of Sao Paulo in Brazil.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the
Company's executive officers and directors and persons who own more than 10% of
a registered class of the Company's equity securities, to file with the
Securities and Exchange Commission (hereinafter referred to as the "Commission")
initial statements of beneficial ownership, reports of changes in ownership and
annual reports concerning their ownership, of Common Stock and other equity
securities of the Company on Forms 3, 4, and 5, respectively. Executive
officers, directors and greater than 10% shareholders are required by Commission
regulations to furnish the Company with copies of all Section 16(a) reports they
file. To the Company's knowledge, of the Company's executive officers, directors
and greater than 10% beneficial owners of its common Stock, have not complied
with Section 16(a) filing requirements applicable to them during the Company's
most recent fiscal year.
ITEM 10. EXECUTIVE COMPENSATION
The following table sets forth the cash and non-cash compensation paid by the
Company to its Chief Executive Officer and all other executive officers for
services rendered. No salaries are being paid at the present time, and will not
be paid unless and until there is available cash flow from operations to pay
salaries. There were no grants of options or SAR grants given to any executive
officers during the last fiscal year.
III-2
Annual Compensation
-------------------
Name and Position Salary Bonus Annual Deferred Salary
----------------- ------ ----- ----------------------
Antonio Treminio $120,000 10% of Total Sales $120,000.00
Sylvio Martini $72,000 5% of Total Sales $72,000.00
ITEM 11. SECURITIES OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the beneficial
ownership of the shares of Common Stock of the Company as of the date of this
disclosure(1), by (i) each person who is known by the Company to be the
beneficial owner of more than five percent (5%) of the issued and outstanding
shares of common stock, (ii) each of the Company's directors and executive
officers, and (iii) all directors and executive officers as a group.
Name and Address Number of Shares Percentage Owned(1)
---------------- ---------------- ----------------
Antonio Treminio 9,981,939 41.12%
719 5th Street
Miami Beach, Florida
33139
Sylvio Martini 3,630,000 14.95%
719 5th Street
Miami Beach, Florida
33139
All Directors, Officers
and 5% Shareholders as
a Group 13,611,939 64.55%
(1) Table is based on current outstanding shares of 24,281,950 as of April 29,
2002.
Item 12. Certain Relationships and Related Transactions
None.
Item 13. Exhibits and Reports on Form 8-K
(a) The exhibits required to be filed herewith by Item 601 of Regulation S-B, as
described in the following index of exhibits, are incorporated herein by
reference, as follows:
Exhibit No. Description
----------- ----------------------------------------------------
3(i).1 Articles of Incorporation (1)
3(ii).1 By-laws (1)
(1) Incorporated herein by reference to the Company's Registration Statement on
Form 10-SB.
III-3
SIGNATURES
----------
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
STARTCALL.COM, INC.
(Registrant)
Date: April 30, 2002 By: /s/ Antonio Treminio
-----------------------------------
Antonio Treminio, President & CEO
Date: April 30, 2002 By: /s/ Sylvio Martini
-----------------------------------
Sylvio Martini, Chief Operating Officer
In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.
Date Signature Title
April 30, 2002 By: /s/ Antonio Treminio
--------------------------
Antonio Treminio President and
Chief Executive Officer
April 30, 2002 By: /s/ Sylvio Martini
--------------------------
Sylvio Martini Chief Operating Officer
III-4