As filed with the Securities and
Exchange Commission on March ___, 2001 Registration No.
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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ZAPWORLD.COM
(Exact name of registrant as specified in its charter)
California 94-3210624
(State of incorporation) (I.R.S. Employer Identification No.)
117 Morris Street
Sebastopol, California 95472
(707) 824-4150
(Address and telephone number of registrant's principal executive offices)
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Gary Starr
Chief Executive Officer
Zapworld.com
117 Morris Street
Sebastopol, California 95472
(707) 824-4150
(Name, address and telephone number of agent for service)
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Copy to:
William D. Evers
Foley & Lardner
One Maritime Plaza, Sixth Floor
San Francisco, California 94111-3404
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Approximate date of commencement of proposed sale to the public: As
soon as practicable after this Registration Statement becomes effective.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule
462(c) of the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. |_|
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CALCULATION OF REGISTRATION FEE
=============================== ==================== ===================== ==================== =====================
Proposed Maximum Proposed Maximum
Title of Each Class of Amount to be Offering Price Aggregate Offering Amount of
Securities to be Registered Registered(1)(2) Per Unit (3) Price (3) Registration Fee
------------------------------- -------------------- --------------------- -------------------- ---------------------
Common stock, no par value 255,000 shares $1.78 $453,900 $113.48
=============================== ==================== ===================== ==================== =====================
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933 based upon the
average of the high and low prices for Zapworld.com Common stock as
reported on the NASDAQ Stock Market on March 5, 2001.
(2) Consists of 210,000 options to purchase Zapworld.com Common stock
pursuant to the Zapworld.com 1999 Incentive Stock Plan, and 45,000 shares
of Zapworld.com Common stock.
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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The information in this prospectus is not complete and may be changed. These
shares may not be sold until the registration statement filed with the
Securities and Exchange Commission is effective. The prospectus is not an offer
to sell these securities and is not a solicitation of offers to buy these
securities in any state where the offer or sale is not permitted.
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255,000 Shares
ZAPWORLD.COM
Common Stock
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The Selling Shareholder identified in this prospectus may use this
prospectus to sell a maximum of 255,000 shares of common stock of Zapworld.com
which he presently owns or may acquire upon the exercise of stock options. We
will not receive the proceeds from the sale of any of these shares, although we
may receive cash proceeds from the Selling Shareholder to the extent that he
exercises options to purchase these shares. Our common stock is traded on the
NASDAQ SmallCap Market under the symbol ZAPP.
The Selling Shareholder may offer and sell the shares from time to time
on the NASDAQ SmallCap Market or in private transactions at prevailing market
prices or at privately negotiated prices. We are paying the expenses incurred in
connection with the registration of these shares under the Securities Act of
1933. The Selling Shareholder is responsible for any brokerage commissions or
expenses he may incur in the sale of the shares. The manner in which the Selling
Shareholder may sell these shares and the price or prices at which the Selling
Shareholder may sell them is further described in this prospectus under the
section entitled "Plan of Distribution" on page 10.
Our principal offices are located at 117 Morris Street, Sebastopol,
California 95472. Our telephone number is (707) 824-4150 and our Internet
address is http://www.zapworld.com. The information on our website does not
constitute part of this prospectus.
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Investing in our common stock involves substantial risks. See the "Risk
Factors" Section beginning on page 3.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of the prospectus. Any representation to the contrary is a
criminal offense.
This prospectus is dated ______________, 2001.
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TABLE OF CONTENTS
Page
THE COMPANY.................................................................2
FORWARD-LOOKING STATEMENTS..................................................2
RISK FACTORS................................................................3
We have a history of losses, and we might not achieve or
maintain profitability................................................3
We may not be able to obtain additional capital to fund
our operations when needed.............................................3
A substantial portion of our growth in the past three years
has come through acquisitions and we may not be able to
identify, complete and integrate future acquisitions, which
could adversely affect our future growth...............................3
We face intense competition which could cause us to lose
market share and reduce profit margins.................................3
Changes in the market for electric vehicles could cause our
products to become obsolete or lose popularity.........................4
We cannot assure you that growth in the electric vehicle
industry will continue. Our business may suffer if growth
in the electric vehicle industry ceases................................4
We may be unable to keep up with changes in electric vehicle
technology and, as a result, may suffer a decline in our
competitive position...................................................5
We will need to increase our research and development spending,
which could substantially increase our costs and adversely
affect our cash flow...................................................5
The failure of certain key suppliers to provide us with
components could have a severe and negative impact upon
our business...........................................................5
Product liability or other claims could have a material
adverse effect on our business.........................................5
Failure to manage our growth effectively could adversely
affect our business....................................................6
The loss of certain key personnel could significantly
harm our business......................................................6
Changes in the law may have a negative impact upon
our business...........................................................6
International expansion may cause problems for us.........................6
We might not be able to retain our Internet address.......................7
Our success is heavily dependent on protecting our
intellectual property rights...........................................7
We may be exposed to liability for infringing intellectual
property rights of other companies.....................................8
USE OF PROCEEDS.............................................................9
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TABLE OF CONTENTS
(Continued)
Page
SELLING SHAREHOLDER.........................................................9
PLAN OF DISTRIBUTION.......................................................10
LEGAL MATTERS..............................................................11
EXPERTS ...................................................................11
WHERE YOU CAN FIND MORE INFORMATION........................................11
INCORPORATION BY REFERENCE.................................................11
COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES......12
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THE COMPANY
Our company, ZAPWORLD.COM(R) was incorporated in California in 1994
under the name "ZAP Power Systems." We design, assemble, manufacture and
distribute electric and non-electric scooters, electric bicycle power kits,
electric bicycles, electric motorcycles and other personal electric
transportation vehicles, including electric wheelchairs and electric aquatic
propulsion devices.
We develop proprietary technologies that are important elements of our
own brand of personal electric vehicles. Each of these components is marketed
under our own brand name. Along with our commitment to develop new electric
vehicles, we are also focusing our development efforts on a new generation of
microprocessor drive controllers.
In this document, "Zapworld," "we," "us" and "our" refer to
Zapworld.com.
You should rely only on the information contained in this document or
to which we have referred you. We have not authorized anyone to provide you with
information that is different.
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference contain
statements that we believe are "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. All statements other
than statements of historical fact, including statements regarding our future
financial position, business strategy, budgets, projected costs and plans and
objectives of management for future operations, are forward-looking statements.
When used in this prospectus, words such as "may," "will," "expect," "intend,"
"estimate," "anticipate," "believe," "should," "plan" or "continue" and similar
expressions are generally intended to identify forward-looking statements. These
forward-looking statements are not guarantees of future performance and are
subject to risks, uncertainties and other facts, some of which are beyond our
control, that could cause actual results to differ materially from those
expressed or implied by those forward-looking statements. These factors include
those described in "Risk Factors" and elsewhere in this prospectus and the
documents incorporated by reference.
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RISK FACTORS
An investment in our common stock involves a high degree of risk. You
should carefully consider the following risk factors before you decide to buy
our common stock.
We have a history of losses, and we might not achieve or maintain profitability.
We have not generated a profit from operations during any fiscal year
since we began operation in 1994. To date, we have concentrated primarily on
increasing our revenues and expanding our market share through acquisitions
rather than on maximizing profits. As a result, although we experienced revenue
growth from fiscal year 1998 to fiscal year 1999, we incurred net losses of
$1,109,400 and $1,692,600 for the years ended December 31, 1998 and 1999,
respectively. Our nine-month loss through September 30, 2000 was $1,014,000.
There is no assurance that we will be able to operate profitably in the future.
Failure to achieve profitable operations may require us to seek additional
financing when none is available or on extremely unfavorable terms.
We may not be able to obtain additional capital to fund our operations when
needed.
Since our inception, we have financed our operations primarily through
private and public offerings of our equity securities. Our planned expenditures
are based primarily on our internal estimates of our future sales and ability to
raise additional financing. If revenues or additional financing do not meet our
expectations in any given period of time, our failure to adjust spending quickly
enough to compensate for revenue or financing shortfalls may reduce our ability
to continue operations.
A substantial portion of our growth in the past three years has come through
acquisitions and we may not be able to identify, complete and integrate future
acquisitions, which could adversely affect our future growth.
Our growth strategy is based in part upon acquiring other businesses
with strategic value to us. It is possible that we may not be able to identify
suitable acquisition candidates, obtain financing for future acquisitions or
complete future acquisitions. In addition, if any future acquisitions are
completed, we may not be able to integrate the acquired businesses or operate
them profitably. Additionally, the diversion of management attention, as well as
any other difficulties which may be encountered in the continuing integration
processes, could have an adverse impact on our financial condition,
profitability and cash flows.
We face intense competition which could cause us to lose market share and reduce
profit margins.
Some of our competitors in the electric vehicle market are large
manufacturers, including Honda, Suzuki, Sanyo and Yamaha. These competitors have
far greater financial resources, more established market positions, and
significantly greater name recognition than we possess. They also have larger,
more established sales, marketing, and distribution programs and resources than
we have. These factors may make it difficult for us to compete with these
businesses in the production and sale of our products.
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Many smaller manufacturers sell electric bicycles to key segments of
our market in the United States, Europe and Asia. We also compete against the
makers of electric scooters as well as non-motorized scooters and bicycles.
Although we believe we have a competitive advantage from our name recognition in
the electric vehicle industry and ownership of fundamental technology, the
market for the sale of these products is subject to rapid change and ease of
entry by new competitors. Many of these competitors are selling their products
at substantial discounts, which has in turn required us to reduce the prices of
our products. Although we have been able to mitigate the impact of these price
reductions by shifting manufacturing of some of our products overseas, the
intense price competition we are encountering is causing us to reduce our
prices, and, thereby, decrease our profit margins. In view of these factors, we
cannot be certain that we will be able to meet changes in the marketplace and
remain competitive.
Changes in the market for electric vehicles could cause our products to become
obsolete or lose popularity.
The electric vehicle industry is in its infancy and has experienced
substantial growth and change in the last few years. Demand for and interest in
electric vehicles appears to be increasing. However, growth in the electric
vehicle industry may depend on many factors, including:
o continued development of product technology;
o the environmental consciousness of customers;
o the ability of electric vehicles to successfully compete with
vehicles powered by internal combustion engines;
o widespread electricity shortages and the resultant increase in
electricity prices, especially in our primary market, California,
which could derail our past and present efforts to promote
electric vehicles as a practical solution to vehicles which
require gasoline;
o changes in the price of fuels for motor vehicles, such as
gasoline; and
o future regulation and legislation requiring increased use of
nonpolluting vehicles or the rejection of such regulation.
Because we believe that changes in the market for electric vehicles in
general may affect the market for our products, these factors may adversely
affect our ability to sell our products.
We cannot assure you that growth in the electric vehicle industry will continue.
Our business may suffer if growth in the electric vehicle industry ceases.
In the last several years there has been a substantial increase in the
number of electric vehicles and non-motorized vehicles which are competitive
with our products. One of our principal challenges is to continue to develop and
market products which keep pace with the rapid changes in the market. If we are
unable to introduce new products and maintain our current market share, we will
likely be unable to continue to increase revenue or begin to operate profitably.
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We may be unable to keep up with changes in electric vehicle technology and, as
a result, may suffer a decline in our competitive position.
Our current products are designed for use with, and are dependent upon,
existing electric vehicle technology. As technologies change, we plan to upgrade
or adapt our products in order to continue to provide products with the latest
technology. However, our products may become obsolete or our research and
development efforts may not be sufficient to adapt to changes in or create
necessary technology. Our potential inability to adapt and develop the necessary
technology may harm our competitive position.
We will need to increase our research and development spending, which could
substantially increase our costs and adversely affect our cash flow.
To keep pace with technological changes and developments in the market
for electric vehicles, we have substantially increased spending on research and
development. Our research and development costs in 1999 were $364,600, as
compared to $202,600 in 1998, an 80% increase. Because we plan to develop new
electric vehicle products and tooling that will broaden our product line in
2001, we expect to incur increased research and development costs in 2001. Our
research and development costs for the period ended September 30, 2000 were
$464,000. Should we be unable to raise sufficient funds in the future to meet
our research and development costs, we could suffer a materially adverse effect
on our business, results of operations and financial condition.
The failure of certain key suppliers to provide us with components could have a
severe and negative impact upon our business.
We rely on a small group of suppliers to provide us with components for
our products, some of whom are located outside of the United States. If these
suppliers become unwilling or unable to provide components, there are a limited
number of alternative suppliers who could provide them. Changes in business
conditions, wars, governmental changes and other factors beyond our control or
which we do not presently anticipate could affect our ability to receive
components from our suppliers. A failure by our major suppliers to provide these
components could severely restrict our ability to manufacture our products and
prevent us from filling customer orders in a timely fashion.
For example, our Zappy(R) and Kick(TM) products account for
approximately 85% of our total sales. We acquire the major components of these
products from only one or two suppliers. It could be difficult to find
replacement components if our current suppliers fail to provide the parts needed
for these products. This would affect our ability to timely fulfill customer
orders, which, in turn, could greatly affect our market position.
Product liability or other claims could have a material adverse effect on our
business.
As producers of electric vehicles sold to the general public, we face
the risk of product liability claims and unfavorable publicity if the use of our
products causes injury or has other adverse effects. Although we have product
liability insurance for risks of up to $10,000,000, that insurance may be
inadequate to cover all potential product claims. In addition, we may not be
able to maintain this insurance indefinitely or be able to avoid product
liability exposure.
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Failure to manage our growth effectively could adversely affect our business.
We plan to increase sales and expand our operations substantially
during the next several years through internally generated growth and the
acquisition of businesses and products.
To manage our growth, we believe we must continue to implement and
improve our operational, manufacturing, and research and development
departments. We may not have adequately evaluated the costs and risks associated
with this expansion, and our systems, procedures, and controls may not be
adequate to support our operations. In addition, our management may not be able
to achieve the rapid execution necessary to successfully offer our products and
services and implement our business plan on a profitable basis. The success of
our future operating activities will also depend upon our ability to expand our
support system to meet the demands of our growing business. Any failure by our
management to effectively anticipate, implement, and manage changes required to
sustain our growth would have a material adverse effect on our business,
financial condition, and results of operations. We cannot assure you that we
will be able to successfully operate acquired businesses, become profitable in
the future or effectively manage any other change. An inability to successfully
operate recently acquired businesses and manage existing business would harm our
operations.
The loss of certain key personnel could significantly harm our business.
Our performance is substantially dependent on the services of our
executive officers and other key employees, as well as on our ability to
recruit, retain and motivate other officers and key employees. Competition for
qualified personnel is intense and there are a limited number of people with
knowledge of and experience in the electric vehicle industry. The loss of the
services of any of our officers or key employees, or our inability to hire and
retain a sufficient number of qualified employees, will harm our business.
Changes in the law may have a negative impact upon our business.
While our products are subject to substantial regulation under federal,
state and local laws, we believe that our products are materially in compliance
with all laws governing their manufacture, sale and use. However, to the extent
the laws change, or if we introduce new products in the future, some or all of
our products may not comply with applicable federal, state or local laws.
Further, certain federal, state and local laws and industrial standards
currently regulate electrical and electronics equipment. Although standards for
electric vehicles are not yet generally available or accepted as industry
standards, our products may become subject to federal, state and local
regulation in the future. Compliance with this regulation could be burdensome,
time consuming, and expensive.
International expansion may cause problems for us.
We intend to expand our business globally. Assuming we conduct this
expansion, we may encounter many of the risks associated with international
business expansion. These risks include, but are not limited to language
barriers, fluctuations in currency exchange rates, political and economic
instability, regulatory compliance difficulties, problems enforcing agreements,
and greater exposure of our intellectual property to markets where a high
probability of unlawful
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appropriation may occur. A failure to successfully mitigate any of these
potential risks could damage our business.
We might not be able to retain our Internet address.
We currently have the Internet address http://www.zapworld.com. We may
not be able to prevent third parties from acquiring Internet addresses that are
similar to our address, which could adversely affect our business. Governmental
agencies and their designees generally regulate the acquisition and maintenance
of Internet addresses. However, the regulation of Internet addresses in the
United States and in foreign countries is subject to change. As a result, we may
not be able to acquire or maintain relevant Internet addresses in all countries
where we conduct business.
Our success is heavily dependent on protecting our intellectual property rights.
We rely on a combination of patent, copyright, trademark and trade
secret protections to protect our proprietary technology. Our success will, in
part, depend on our ability to obtain trademarks and patents and to operate
without infringing on the proprietary rights of others. We may not be able to do
this successfully, however.
We hold several patents registered with the United States Patent and
Trademark Office. These registrations include both design patents and utility
patents. In addition, we have recently submitted provisional patents which may
or may not be afforded the limited protection associated with provisional
patents. We have also registered numerous trademarks with the United States
Patent and Trademark Office, and have several pending at this time. We cannot
assure you that the trademarks and patents issued to us will not be challenged,
invalidated or circumvented, or that the rights granted under those
registrations will provide competitive advantages to us. For example, at the
present time one of our patents, covering various aspects of our electric
bicycle, is being reexamined by the United States Patent and Trademark Office to
determine if one or more of its claims are invalid. If that proceeding results
in an adverse ruling, the patent will be declared invalid. If this occurs, this
could severely and adversely affect our ability to prevent competitors from
copying and using key elements of our technology in developing and marketing
their own products. Additionally, we have recently learned that several
companies are attempting to sell an electric scooter in the United States which
we believe infringes one or more of our patents and trademarks. We have also
discovered that at least one company has unlawfully sampled our copyrighted
advertising copy. In this regard, we have already begun to incur legal fees in
our attempt to prosecute this matter, and, in addition, we may have to incur
substantial legal fees and costs in litigating these matters in the future.
We also rely on trade secrets and new technologies to maintain our
competitive position. Although we have entered into confidentiality agreements
with our employees and consultants, we cannot be certain that others will not
gain access to these trade secrets. Others may independently develop
substantially equivalent proprietary information and techniques or otherwise
gain access to our trade secrets.
-7-
We may be exposed to liability for infringing intellectual property rights of
other companies.
Although we have conducted searches and are not aware of any patents
and trademarks which our products or their use might infringe, we cannot be
certain that infringement has not or will not occur. We could incur substantial
costs in defending any patent or trademark infringement suits or in asserting
any patent or trademark rights, in a suit with another party.
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USE OF PROCEEDS
We will not receive any of the proceeds from the sales of shares of
common stock by the Selling Shareholder; however we may receive proceeds from
the exercise of any stock options by the Selling Shareholder. To the extent that
we receive proceeds from the exercise of these options, we intend to use those
funds for working capital.
SELLING SHAREHOLDER
The Selling Shareholder is Harry Kraatz, who is a member of our Board
of Directors and is a financial advisor to Zapworld. The shares the Selling
Shareholder may sell through this prospectus consist of 45,000 shares of our
common stock which he presently owns and 210,000 shares of our common stock
which he may purchase upon the exercise of stock options. We granted the Selling
Shareholder these options under the Zapworld.com 1999 Incentive Stock Plan and
all of these stock options are Incentive Stock Options as defined in Section 421
of the Internal Revenue Code. All of the options must be exercised in full
within ten years of the date they were granted. The dates on which the Selling
Shareholder received the options and the exercise prices for the options are as
follows:
o On October 1, 1998, we granted the Selling Shareholder an option
to purchase 10,000 shares at a price of $4.00 per share. The
Selling Shareholder has a present right to purchase all of these
shares.
o On February 22, 1999, we granted the Selling Shareholder an option
to purchase 100,000 shares at a price of $5.37 per share. The
Selling Shareholder has a present right to purchase all of these
shares.
o On August 1, 2000, we granted the Selling Shareholder an option to
purchase 100,000 shares at a price of $5.25 per share. As of March
1, 2001, 35,556 of these shares have vested. The remaining shares
subject to the option vest at a rate of one thirty-sixths (1/36)
per month until such time as they all become vested. Further,
these options are subject to an accelerated vesting provision
whereby an additional 20,000 options shall immediately vest for
each $5,000,000 we receive in financing from any sources found by
the Selling Shareholder.
The following table sets forth the percentage of our outstanding shares
which the Selling Shareholder owns or has a right to acquire upon the exercise
of stock options. The statement as to the number of outstanding shares is based
on the number of shares of common stock outstanding as of March 1, 2001.
Shares Beneficially Owned Shares Beneficially Owned
Prior to Offering(1) After Offering(2)
Name of Beneficial Owner Number Percent Number Percent
Harry Kraatz 255,000 4.1% 0 0
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(1) The number of shares of common stock purchasable under the Selling
Shareholder's options are assumed to be issued for the purpose of calculating
the percentage of the outstanding shares the Selling Shareholder owns,
regardless of whether those shares are presently vested.
(2) Assumes that the Selling Shareholder sells all of the shares being offered
through this prospectus.
PLAN OF DISTRIBUTION
The Selling Shareholder may sell the shares of common stock subject to
this prospectus from time to time for his own account. The fact that we are
registering the sale of these shares does not necessarily mean that the Selling
Shareholder will necessary offer or sell any or all of them. The Selling
Shareholder will act independently of us in marketing decisions with respect to
the timing, manner and size of each sale.
The Selling Shareholder may offer and sell the shares from time to time
in transactions on The NASDAQ SmallCap Market on terms to be determined at the
time of such sales. The Selling Shareholder may also make private transfers
directly or through a broker or brokers. Alternatively, the Selling Shareholder
may from time to time offer shares of common stock to or through underwriters,
dealers or agents, who may receive consideration in the form of discounts and
commissions. Such compensation, which may be in excess of normal brokerage
commissions, may be paid by the Selling Shareholder and/or purchasers of the
shares of common stock for whom such underwriters, dealers or agents may act.
The Selling Shareholder and any dealers or agents that participate in the
distribution of the shares of common stock offered through this prospectus may
be deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act, and any discounts, commissions or concessions received and any
profit realized by them on the resale of shares as principals may be deemed
underwriting compensation under the Securities Act. The common stock may be sold
from time to time in one or more transactions at a fixed price, which may be
changed, or at varying prices determined at the time of such sale or at
negotiated prices.
We may, from time to time, notify the Selling Shareholder that this
prospectus is not current and that sales of the common stock may not occur until
the prospectus is supplemented by amendment. To the extent required, the
specific shares of common stock to be sold, the respective purchase prices and
public offering prices, the names of any agent, dealer or underwriter and any
applicable commissions or discounts with respect to a particular offer will be
set forth in an accompanying prospectus supplement, or, if appropriate, a
post-effective amendment to the registration statement of which this prospectus
forms a part.
The laws of certain states require that sale of the shares of common
stock be conducted solely through brokers or dealers registered in those states.
In addition, in certain states the shares of common stock may not be sold unless
they have been registered or qualified for sale in the applicable state or an
exemption therefrom is available.
We will pay substantially all of the expenses incurred in the
registration of these shares under the Securities Act of 1933. However, the
Selling Shareholder will be responsible for paying any discounts, commissions,
transfer taxes and other selling expenses he incurs in the sale of these shares.
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LEGAL MATTERS
The validity of the shares of our common stock will be passed upon for
the Selling Shareholder and us by Foley & Lardner, San Francisco, California.
William D. Evers, who has been one of our directors since 1999, is special
counsel to Foley & Lardner. In 1999 and 2000, Mr. Evers was granted options to
purchase 75,000 shares of our common stock at exercise prices ranging from $3.02
to $6.50 per share.
EXPERTS
Grant Thornton, LLP, independent auditors, have audited our
consolidated financial statements and schedules at December 31, 1999, and for
each of the two years in the period ended December 31, 1999, as set forth in
their report incorporated by reference in this prospectus and registration
statement. We have incorporated by reference our financial statements in the
prospectus and registration statement in reliance on Grant Thornton, LLP's
report, given on their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and
other information with the SEC. You may read and copy any reports, statements or
other information on file at the SEC's Public Reference Room at 450 Fifth
Street, N.W. Washington D.C. 20549. The SEC also maintains an Internet site that
contains reports, proxy and information statements and other information
regarding issuers that file electronically with the SEC, including us. These
filings are available to the public on the SEC's Internet site at
http://www.sec.gov.
INCORPORATION BY REFERENCE
We have filed a registration statement on Form S-3 under the Securities
Act of 1933 with respect to the shares being offered for sale in this
prospectus. This prospectus, which forms a part of the registration statement,
does not contain all of the information included in the registration statement.
Some information is omitted and you should refer to the registration statement
and its exhibits.
We are allowed to incorporate by reference the information we file with
the SEC, which means we can disclose important information to you by referring
to those documents. The information we are incorporating by reference is an
important part of this prospectus. The most recent information we file with the
Commission automatically updates and supersedes any older information. We
incorporate by reference the following documents we have filed or may file with
the Commission pursuant to Sections 13, 14 and 15(d) of the Securities Exchange
Act until we terminate the offering:
o Our Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1999, as amended by our Form 10-KSB/A filed May 17,
2000;
o Our Quarterly Reports on Form 10-QSB for the quarters ended March
31, 2000, June 30, 2000 (as amended by our Form 10-QSB/A filed
August 21, 2000), and September 30, 2000;
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o Our Proxy Statement for our 2000 Annual Meeting of Shareholders
dated June 1, 2000;
o Our Current Report on Form 8-K dated January 12, 2001;
o The description of our common stock contained in our Registration
Statement on Form SB-2 dated February 13, 2001, and any amendment
or report updating that description; and
o All documents filed by us pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 in the future until
the offering of these shares is terminated.
You may request a copy of any of these documents at no cost, by writing
to us at the following address: Corporate Secretary, Zapworld.com, 117 Morris
Street, Sebastopol, California 95472; or you may contact us by telephone at
(707) 824-4150.
COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Our Articles of Incorporation and Bylaws provide that we shall
indemnify our directors and officers, and may indemnify our other employees and
agents, to the fullest extent permitted by California law.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "Act"), may be afforded to our directors, officers
and controlling persons pursuant to our Amended Bylaws and Amended Articles of
Incorporation, or otherwise, we have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable.
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PART II INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth all expenses payable by the registrant
in connection with the sale of the common stock being offered. All the amounts
shown are estimates except for the registration fee.
Registration fee.............................$ 113.48
Printing and engraving expenses..............$ 1,000.00
Legal fees and expenses......................$ 5,000.00
Accounting Fees and Expenses.................$ 1,500.00
Miscellaneous................................$ 500.00
Total........................................$ 8,113.48
Item 15. Indemnification of Directors and Officers
Our Amended Bylaws provide that we may indemnify any director, officer,
agent or employee against all expenses and liabilities, including counsel fees,
reasonably incurred by or imposed upon such persons in connection with any
proceeding to which any such persons may become involved by reason of such
persons being or having been a director, officer, employee or agent of our
company. Moreover, our Amended Bylaws provide that we shall have the right to
purchase and maintain insurance on behalf of any such persons whether or not we
would have the power to indemnify such person against the liability insured
against. Our Amended Articles of Incorporation provide that we may indemnify our
directors and officers to the fullest extent permissible under California law.
In accordance with these Articles of Incorporation, the liability of our
directors for monetary damages is eliminated to the fullest extent permissible
under California law.
Item 16. Exhibits
Exhibit
No. Exhibit
(4.1) Articles of Incorporation of ZAP Power Systems, endorsed and filed
on September 23, 1994, defining the rights of holders of capital
stock.
(4.2) Certificate of Amendment to Articles of Incorporation of ZAP Power
Systems, endorsed and filed on November 8, 1996.
(4.3) Certificate of Amendment of Articles of Incorporation of ZAP Power
Systems, endorsed and filed on June 2, 1999.
(4.4) Certificate of Amendment of Articles of Incorporation of
Zapworld.com, endorsed and filed June 28, 2000.
(4.5) Certificate of Determination of Rights and Preferences of the
Series A-1 Convertible Preferred Stock and Series A-2 Convertible
Preferred Stock, endorsed and filed June 28, 2000.
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Exhibit
No. Exhibit
(4.6) Certificate of Amendment of Articles of Incorporation of
Zapworld.com, endorsed and filed February 26, 2001.
(4.7) Amended Bylaws of Zapworld.com, dated June 24, 2000, defining the
rights of holders of capital stock.
(4.8) Zapworld.com 1999 Incentive Stock Plan.
(5.1) Opinion of Foley & Lardner.
(23.1) Consent of Grant Thornton, LLP.
(23.2) Consent of Foley & Lardner.
Item 17. Undertakings
a) The Registrant hereby undertakes that it will:
1) File, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to include any
additional or changed material information on the plan of distribution.
2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the bona fide
offering.
3) File a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of the Offering.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Sebastopol, State of California, on March 5, 2001.
Zapworld.com
By: /s/ Gary Starr
Gary Starr
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ Gary Starr Chief Executive Officer, Chief March 5, 2001
---------------- Financial Officer, and Director
Gary Starr
/s/ Robert E. Swanson Chairman of the Board March 5, 2001
----------------------- and Director
Robert E. Swanson
/s/ William D. Evers Director March 5, 2001
----------------------
William D. Evers
/s/ Harry Kraatz Director March 5, 2001
------------------
Harry Kraatz
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