EXHIBIT 4.5
-------------------------------------------------------------------
OFFERING MEMORANDUM
-------------------------------------------------------------------
IPVoice Communications, Inc.
(A Nevada Corporation)
Offering Memorandum Dated February 1, 1999
1,250,000 shares
IPVoice Communications, Inc., a Nevada corporation, f/k/a Nova
Enterprises, Inc., (the "Company"), is offering on a "best efforts, no minimum
basis" 1,250,000 shares of its common stock ("Shares"), $.001 par value, at a
price of $0.40 per share (the "Subscription Price"). Since there is no minimum,
no proceeds will be held in an escrow account and all funds will be immediately
available to the Company.
The Shares are being sold by the Company's Officers and Directors and
no commissions will be paid to them in connection with the Offering. However,
participating NASD registered broker/dealers, if any, shall receive a maximum of
10% sales commissions on all shares sold through their efforts.
The Company's Common Stock is currently listed on the Over the Counter
Electronic Bulletin Board. There can be no assurances that an active trading
market for the Company's stock exists, or will continue if it currently exists.
The price of the Shares offered hereby was arbitrarily determined by
the Company and does not bear any relationship to the Company's assets, book
value, net worth, results of operations or any other recognized criteria of
value. For additional information regarding the factors considered in
determining the offering price of the Shares, see "Risk Factors - Arbitrary
Offering Price", "Description of Securities".
The Company does not presently file reports or other information with
the Securities and Exchange Commission ("Commission"). However, following
completion of this Offering, the Company intends to furnish its security holders
with annual reports containing audited financial statements and such interim
reports in each case as it may determine to furnish or as may be required by
law.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OF ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE SECURITIES ARE OFFERED BY THE COMPANY SUBJECT TO PRIOR SALE,
ACCEPTANCE OR AN OFFER TO PURCHASE, WITHDRAWAL, CANCELLATION OR MODIFICATION OF
THE OFFER, WITHOUT NOTICE. THE COMPANY RESERVES THE RIGHT TO REJECT ANY ORDER,
IN WHOLE OR IN PART, FOR THE PURCHASE OF ANY OF THE SECURITIES OFFERED HEREBY.
This offering involves special risks concerning the Company (see "Risk
Factors"). Investors should carefully review the entire Memorandum and should
not invest any funds in this Offering unless they can afford to lose their
entire investment. In making an investment decision, investors must rely on
their own examination of the issuer and the terms of the Offering, including the
merit and risks involved.
REGULATION D OFFERING
THIS OFFERING IS BEING MADE PURSUANT TO THE EXEMPTIONS AFFORDED BY
SECTIONS 4(2) OR 3(b) OF SECURITIES ACT OF 1933 AND RULE 504 OF REGULATION D
PROMULGATED THEREUNDER AND THE STATE SMALL CORPORATE OFFERING REGISTRATION
PROVISION. PURSUANT TO RULE 504, THE SHARES SOLD HEREBY WILL NOT BE SUBJECT TO
ANY LIMITATIONS ON RESALE THEREOF UNDER FEDERAL LAW. THE SHARES MAY, HOWEVER, BE
SUBJECT TO LIMITATIONS ON THE OFFER AND SALE AND THE RESALE OF THE SHARES
IMPOSED BY THE BLUE SKY LAWS OF INDIVIDUAL STATES. IN ADDITION, THE COMPANY
INTENDS TO FILE THE REQUIRED DOCUMENTS IN CERTAIN OTHER STATES IDENTIFIED BY
MANAGEMENT AS HAVING POSSIBLE INVESTOR INTEREST AND USE ITS BEST EFFORTS TO
QUALIFY THE SHARES FOR SECONDARY TRADING IN SUCH STATES, THOUGH NO ASSURANCE CAN
BE GIVEN THAT IT WILL BE ABLE TO QUALIFY THE SHARES FOR SECONDARY TRADING IN ANY
SUCH STATES IN WHICH IT SUBMITS SUCH APPLICATIONS AND DOCUMENTS. AN INABILITY TO
QUALIFY THE SHARES FOR SECONDARY TRADING WILL CREATE SUBSTANTIAL RESTRICTIONS ON
THE TRANSFERABILITY OF SUCH SHARES WHICH MAY NEGATE THE BENEFIT OF THE EXEMPTION
PROVIDED BY RULE 504 OF REGULATION D. THE COMPANY WILL USE ITS BEST EFFORTS TO
CAUSE THE SHARES TO BE LISTED ON THE ELECTRONIC BULLETIN BOARD OPERATED BY THE
NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. AS A MARKET IN WHICH THEY MAY
BE TRADED. THERE IS NO ASSURANCE THAT SUCH LISTING WILL BE OBTAINED OR THAT IF A
LISTING IS OBTAINED THAT ANY MARKET FOR THE SHARES WILL DEVELOP, OR IF
DEVELOPED, THAT IT WILL BE SUSTAINED.
NOTICES TO RESIDENTS OF CERTAIN STATES
NOTICE TO ALABAMA RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
ALABAMA SECURITIES ACT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES
HAS NOT BEEN FILED WITH THE ALABAMA SECURITIES COMMISSION. THE COMMISSION DOES
NOT RECOMMEND OR ENDORSE THE PURCHASE OF ANY SECURITIES, NOR DOES IT PASS UPON
THE ACCURACY OR COMPLETENESS OF THIS OFFERING MEMORANDUM. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
ANYTHING TO THE CONTRARY HEREIN NOTWITHSTANDING, THE INVESTMENT OF AN
ALABAMA PURCHASER WHO IS NOT AN ACCREDIT INVESTOR MAY NOT EXCEED TWENTY (20%)
PER CENT OF SUCH PURCHASER'S NET WORTH, EXCLUSIVE OF PRINCIPAL RESIDENCE,
FURNISHINGS AND AUTOMOBILES.
NOTICE TO ALASKA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE ALASKA SECURITIES
ACT AND MAY NOT BE SOLD WITHOUT REGISTRATION UNDER THAT ACT OR EXEMPTION
THEREFROM.
NOTICE TO ARIZONA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE ARIZONA SECURITIES
ACT AND ARE BEING SOLD IN RELIANCE UPON THE EXEMPTION CONTAINED IN SECTION
44-184(1) OF SUCH ACT. THESE SECURITIES MAY NOT BE SOLD WITHOUT REGISTRATION
UNDER SUCH ACT OR EXEMPTION THEREFROM.
ARIZONA RESIDENTS MUST HAVE EITHER (i) A MINIMUM NET WORTH OF AT LEAST
SEVENTY FIVE THOUSAND ($75,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND A MINIMUM ANNUAL GROSS INCOME OF SEVENTY FIVE THOUSAND
(475,000) DOLLARS; OR (iii) A NET WORTH OF AT LEAST TWO HUNDRED TWENTY FIVE
THOUSAND ($225,000) DOLLARS (AS COMPUTED ABOVE).
NOTICE TO ARKANSAS RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER
SECTION 14(b)(14) OF THE ARKANSAS SECURITIES ACT AND SECTION 4(2) OF THE
SECURITIES ACT OF 1933. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES
HAS NOT BEEN FILED WITH THE ARKANSAS SECURITIES DEPARTMENT OR WITH THE
SECURITIES AND EXCHANGE COMMISSION. NEITHER THE DEPARTMENT NOR THE COMMISSION
HAS PASSED UPON THE VALUE OF THESE SECURITIES, MADE ANY RECOMMENDATIONS AS TO
THEIR PURCHASE, APPROVED OR DISAPPROVED THE OFFERING, OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS OFFERING MEMORANDUM. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, AN INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TWENTY (20%) PER CENT OF THE INVESTOR'S
NET WORTH AT THE TIME OF PURCHASE, ALONE OR JOINTLY WITH SPOUSE.
NOTICE TO CALIFORNIA RESIDENTS
IF THE COMPANY ELECTS TO SELL SHARES IN THE STATE OF CALIFORNIA, IT IS
UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THE SHARES, OR OTHER INTEREST
THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR WITHOUT THE PRIOR WRITTEN
CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA, EXCEPT
AS PERMITTED IN THE COMMISSIONER'S RULES.
NOTICE TO CONNECTICUT RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE CONNECTICUT SECURITIES
ACT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION OR EXEMPTION
THEREFROM.
NOTICE TO DELAWARE RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE DELAWARE SECURITIES ACT
AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION OR EXEMPTION THEREFROM.
NOTICE TO FLORIDA RESIDENTS
THE SHARES REFERRED TO HEREIN WILL BE SOLD TO, AND ACQUIRED BY, THE HOLDER
IN A TRANSACTION EXEMPT UNDER SECTION 517.061 OF THE FLORIDA SECURITIES ACT. THE
SHARES HAVE NOT BEEN REGISTERED UNDER SAID ACT IN THE STATE OF FLORIDA. IN
ADDITION, ALL FLORIDA RESIDENTS SHALL HAVE THE PRIVILEGE OF VOIDING THE PURCHASE
WITHIN THREE (3) DAYS AFTER THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH
PURCHASER TO THE ISSUER, AN AGENT OF THE ISSUER, OR AN ESCROW AGENT OR WITHIN
THREE (3) DAYS AFTER THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH
PURCHASER, WHICHEVER OCCURS LATER.
NOTICE TO GEORGIA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE GEORGIA SECURITIES ACT
OF 1973, AS AMENDED. IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION SET FORTH
IN SECTION 9(M) OF SUCH ACT AND THE SECURITIES CANNOT BE SOLD OR TRANSFERRED
EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER SUCH ACT OR PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR IN A TRANSACTION WHICH IS
OTHERWISE IN COMPLIANCE WITH SAID ACT.
NOTICE TO IDAHO RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE CONNECTICUT SECURITIES
ACT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION OR EXEMPTION
THEREFROM.
ANYTHING TOT HE CONTRARY NOTWITHSTANDING, THE INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET
WORTH.
NOTICE TO INDIANA RESIDENTS
EACH INVESTOR PURCHASING SHARES MUST WARRANT THAT HE HAS EITHER (i) A
NET WORTH (EXCLUSIVE OF HOME, HOME FURNISHING AND AUTOMOBILES) EQUAL TO AT LEAST
THREE (3) TIMES THE AMOUNT OF HIS INVESTMENT BUT IN N O EVENT LESS THAN SEVENTY
FIVE THOUSAND (475,000) DOLLARS OR (ii) A NET WORTH (EXCLUSIVE OF HOME, HOME
FURNISHING AND AUTOMOBILES OF TOW (2) TIMES HIS INVESTMENT BUT IN NOT EVENT LESS
THAN THIRTY THOUSAND ($30,000) DOLLARS AND A GROSS INCOME OF THIRTY THOUSAND
($30,000) DOLLARS.
NOTICE TO IOWA RESIDENTS
IOWA RESIDENTS MUST HAVE EITHER (i) A NET WORTH OF AT LEAST FORTH
THOUSAND ($40,000) DOLLARS (EXCLUSIVE OF HOME, HOME FURNISHINGS AND AUTOMOBILES)
AND A MINIMUM ANNUAL GROSS INCOME OF FORTH THOUSAND ($40,000) DOLLARS, OR (ii) A
NET WORTH OF AT LEAST ONE HUNDRED TWENTY FIVE THOUSAND ($125,000) DOLLARS AS
COMPUTED ABOVE.
NOTICE TO KANSAS RESIDENTS
AN INVESTMENT BY A NON-ACCREDITED INVESTOR SHALL NOT EXCEED TWENTY
(20%) PER CENT OF THE INVESTOR'S NET WORTH; EXCLUDING PRINCIPAL RESIDENCE,
FURNISHINGS THEREIN AND PERSONAL AUTOMOBILES.
NOTICE TO KENTUCKY RESIDENTS
THESE SECURITIES REPRESENTED BY THIS CERTIFICATE (OR OTHER DOCUMENT)
HAVE BEEN ISSUED PURSUANT TO A CLAIM OF EXEMPTION FROM THE REGISTRATION OR
QUALIFICATION PROVISIONS OF FEDERAL AND STATE SECURITIES LAWS AND MAY NOT BE
SOLD OR TRANSFERRED WITHOUT COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION
PROVISIONS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE
EXEMPTIONS THEREIN.
ANYTHING TO THE CONTRARY HEREIN NOTWITHSTANDING,THE INVESTMENT BY A NON-
ACCREDITED INVESTOR MAY NOT EXCEED TEN (10%) OF THE INVESTOR'S NET WORTH.
NOTICE TO MAINE RESIDENTS
THESE SECURITIES ARE BEING SOLD PURSUANT TO AN EXEMPTION FROM
REGISTRATION WITH THE BANK SUPERINTENDENT OF THE STATE OF MAINE UNDER SECTION
1052(2)(R) OF TITLE 32 OF THE MAINE REVISED STATUES. THESE SECURITIES MAY BE
DEEMED RESTRICTED SECURITIES AND AS SUCH THE HOLDER MAY NOT BE ABLE TO RESELL
THE SECURITIES UNLESS PURSUANT TO REGISTRATION UNDER STATE OR FEDERAL SECURITIES
LAWS OR UNLESS AN EXEMPTION UNDER SUCH LAWS EXISTS.
NOTICE TO MARYLAND RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE MARYLAND SECURITIES
ACT IN RELIANCE UPON THE EXEMPTION FROM REGISTRATION SET FORTH IN SECTION
11-602(9) OF SUCH ACT. UNLESS THESE SECURITIES ARE REGISTERED, THEY MAY NOT BE
REOFFERED FOR SALE OR RESOLD IN THE STATE OF MARYLAND, EXCEPT AS A SECURITY, OR
IN A TRANSACTION EXEMPT UNDER SUCH ACT.
NOTICE TO MASSACHUSETTS RESIDENTS
MASSACHUSETTS RESIDENTS MUST HAVE HAD EITHER (i) A MINIMUM NET WORTH OF
AT LEAST FIFTY THOUSAND ($50,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND HAD DURING THE LAST YEAR, OR IT IS ESTIMATED THAT THE
SUBSCRIBER WILL HAVE DURING THE CURRENT TAKE YEAR, TAXABLE INCOME OF FIFTY
THOUSAND ($50,000) DOLLARS, OR (ii) A NET WORTH OF AT LEAST ONE HUNDRED FIFTY
THOUSAND ($150,000) DOLLARS (AS COMPUTED ABOVE).
NOTICE TO MICHIGAN RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE MICHIGAN SECURITIES
ACT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION UNDER THAT ACT OR
EXEMPTION THEREFROM.
THE COMPANY SHALL PROVIDE ALL MICHIGAN INVESTORS WITH A DETAILED
WRITTEN STATEMENT OF THE APPLICATION OF THE PROCEEDS OF THE OFFERING WITHIN SIX
(6) MONTHS AFTER COMMENCEMENT OF THE OFFERING OR UPON COMPLETION, WHICHEVER
OCCURS FIRST, AND WITH ANNUAL CURRENT BALANCE SHEETS AND INCOME STATEMENT
THEREAFTER.
NOTICE TO MINNESOTA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER CHAPTER 80 OF THE
MINNESOTA SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED
OF FOR VALUE EXCEPT PURSUANT TO REGISTRATION OR OPERATION OF LAW.
NOTICE TO MISSISSIPPI RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
MISSISSIPPI SECURITIES ACT. A REGISTRATION STATEMENT RELATING TO THESE
SECURITIES HAS NOT BEEN FILED WITH THE MISSISSIPPI SECRETARY OF STATE OR WITH
THE SECURITIES AND EXCHANGE COMMISSION. NEITHER THE SECRETARY OF STATE NOR THE
COMMISSION HAS PASSED UPON THE VALUE OF THESE SECURITIES, NO HAS APPROVED OR
DISAPPROVED THE OFFERING. THE SECRETARY OF STATE DOES NOT RECOMMEND THE PURCHASE
OF THESE OR ANY OTHER SECURITIES.
THERE IS NOT ESTABLISHED MARKET FOR THESE SECURITIES AND THERE MAY NOT
BE ANY MARKET FOR THESE SECURITIES IN THE FUTURE. THE SUBSCRIPTION PRICE OF
THESE SECURITIES HAS BEEN ARBITRARILY DETERMINED BY THE ISSUER AND IS NOT AN
INDICATION OF THE ACTUAL VALUE OF THESE SECURITIES.
THE PURCHASER OF THESE SECURITIES MUST MEET CERTAIN SUITABILITY
STANDARDS AND MUST BE ABLE TO BEAR THE ENTIRE LOSS OF HIS INVESTMENT.
ADDITIONALLY, ALL PURCHASERS WHO ARE NOT ACCREDITED INVESTORS MUST HAVE A NET
WORTH OF AT LEAST THIRTY THOUSAND ($30,000) DOLLARS AND INCOME OF THIRTY
THOUSAND ($30,000) DOLLARS OR A NET WORTH OF SEVENTY FIVE THOUSAND ($75,000)
DOLLARS. THESE SECURITIES MAY NOT BE TRANSFERRED FOR A PERIOD OF ONE (1) YEAR
EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER THE MISSISSIPPI SECURITIES ACT OR
IN A TRANSACTION IN COMPLIANCE WITH THE MISSISSIPPI SECURITIES ACT.
NOTICE TO MISSOURI RESIDENTS
THESE SECURITIES ARE SOLD TO, AND BEING ACQUIRED BY, THE HOLDER IN
A TRANSACTION EXEMPTED UNDER SECTION 10, SUBSECTION 409.402(b), MISSOURI
UNIFORM SECURITIES ACT (RMSO 1969).
THE SHARES HAVE TO BEEN REGISTERED UNDER SAID ACT IN THE STATE OF
MISSOURI, UNLESS THE SHARES ARE REGISTERED, THEY MAY NOT BE REOFFERED OR RESOLD
IN THE STATE OF MISSOURI, EXCEPT AS A SECURITY, OR IN A TRANSACTION EXEMPT UNDER
SAID ACT.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTOR MUST HAVE A
MINIMUM ANNUAL INCOME OF THIRTY THOUSAND ($330,000) DOLLARS AND A NET WORTH OF
AT LEAST THIRTY THOUSAND ($30,000)(DOLLARS, EXCLUSIVE OF HOME, FURNISHINGS AND
AUTOMOBILES OR A NET WORTH OF SEVENTY FIVE THOUSAND ($75,000) DOLLARS EXCLUSIVE
OF HOME, FURNISHINGS AND AUTOMOBILES.
AN INVESTMENT BY A NON-ACCREDITED INVESTOR SHALL NOT EXCEED TWENTY
(20%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE TO MONTANA RESIDENTS
EACH MONTANA RESIDENT WHO SUBSCRIBES FOR THE SECURITIES BEING OFFERED
HEREBY AGREES NOT TO SELL THESE SECURITIES FOR A PERIOD OF TWELVE (12) MONTHS
AFTER DATE OF PURCHASE.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, THE INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TWENTY (20%) PER CENT OF THE INVESTOR'S
NET WORTH.
NOTICE TO NEBRASKA RESIDENTS
THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE NEBRASKA
SECURITIES ACT AND MAY NOT BE SOLD WITHOUT REGISTRATION UNDER THE ACT
OR EXEMPTION THEREFROM.
NOTICE TO NEW HAMPSHIRE RESIDENTS
EACH NEW HAMPSHIRE INVESTOR PURCHASING SHARES MUST WARRANT THAT HE HAS
EITHER (i) A NET WORTH (EXCLUSIVE OF HOME, HOME FURNISHING AND AUTOMOBILES) OF
TWO HUNDRED FIFTY THOUSAND ($250,000) DOLLARS OR (iii) A NET WORTH (EXCLUSIVE OF
HOME, HOME FURNISHINGS AND AUTOMOBILES OF ONE HUNDRED TWENTY FIVE THOUSAND
($125,000) DOLLARS AND FIFTY THOUSAND ($50,000 DOLLARS ANNUAL INCOME.
NOTICE TO NEW JERSEY RESIDENTS
THE ATTORNEY GENERAL OF THE STATE HAS NOT PASSED ON OR ENDORSED THE
MERITS OF THIS OFFERING. THE FILING OF THE WITHIN OFFERING DOES TO CONSTITUTE
APPROVAL OF THE ISSUE OR THE SALE THEREOF BY THE BUREAU OF SECURITIES OR THE
DEPARTMENT OF LAW AND PUBLIC SAFETY OF THE STATE OF NEW JERSEY. ANY
REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
NOTICE TO NORTH DAKOTA RESIDENTS
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES COMMISSION OF THE STATE OF NORTH DAKOTA NOR HAS THE COMMISSIONER
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS CRIMINAL OFFENCE.
NOTICE TO NEW YORK RESIDENTS
THIS OFFERING MEMORANDUM HAS NOT BEEN REVIEWED BY THE ATTORNEY GENERAL
PRIOR TO ITS ISSUANCE AND USE. THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS
NOT PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
THIS OFFERING MEMORANDUM DOES NOT CONTAIN AN UNTRUE STATEMENT OF A
MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY TO MAKE THE STATEMENTS
MADE IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING.
IT CONTAINS A FAIR SUMMARY OF THE MATERIAL TERMS AND DOCUMENTS PURPORTED TO BE
SUMMARIZED HEREIN.
NOTICE TO NORTH CAROLINA RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
NORTH CAROLINA SECURITIES ACT. THE NORTH CAROLINA SECURITIES ADMINISTRATOR
NEITHER RECOMMENDS NOR ENDORSES THE PURCHASE OF ANY SECURITY, NOR HAS THE
ADMINISTRATOR PASSED ON THE ACCURACY OR ADEQUACY OF THE INFORMATION PROVIDED
HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NOTICE TO OKLAHOMA RESIDENTS
THESE SECURITIES RENDERED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE OKLAHOMA SECURITIES ACT. THE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED FOR VALUE
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OF THEM UNDER THE SECURITIES ACT OF
1933 AND/OR THE OKLAHOMA SECURITIES ACT OF AN OPINION OF COUNSEL TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR ACTS.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY A NON-ACCREDITS
INVESTOR SHALL NOT EXCEED THEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE TO OREGON RESIDENTS
THE SECURITIES OFFERED HAVE BEEN REGISTERED WITH THE DIRECTOR OF THE
STATE OF OREGON UNDER THE PROVISIONS OF OAR 000-00-000. THE INVESTOR IS ADVISED
THAT THE DIRECTOR HAS MADE ONLY A CURSORY REVIEW OF THE REGISTRATION STATEMENT
AND HAS NOT REVIEWED THIS DOCUMENTS SINCE THIS DOCUMENT IS NOT REQUIRED TO BE
FILED WITH THE DIRECTOR.
THE INVESTOR MUST RELY ON THE INVESTOR'S OWN EXAMINATION OF THE COMPANY
CREATING THE SECURITIES, AND THE TERMS OF THE OFFERING INCLUDING THE MERITS AND
RISKS INVOLVED IN MAKING AN INVESTMENT DECISION ON THESE SECURITIES.
NOTICE TO PENNSYLVANIA RESIDENTS
ANY PERSON WHO ACCEPTS AN OFFER TO PURCHASE THE SECURITIES IN THE
COMMONWEALTH OF PENNSYLVANIA IS ADVISED, THAT PURSUANT TO SECTION 207(m) OF THE
PENNSYLVANIA SECURITIES ACT, HE SHALL HAVE THE RIGHT TO WITHDRAW HIS ACCEPTANCE,
AND RECEIVE A FULL REFUND OF ANY CONSIDERATION PAID, WITHOUT INCURRING ANY
LIABILITY, WITHIN TWO (20) BUSINESS DAYS FROM THE TIME THAT HE RECEIVES NOTICE
OF THIS WITHDRAWAL RIGHT AND RECEIVES THE PLACEMENT OFFERING MEMORANDUM. ANY
PERSON WHO WISHES TO EXERCISE SUCH RIGHT OF WITHDRAWAL IS ADVISED TO GIVEN
NOTICE BY LETTER OR TELEGRAM SENT TO POSTMARKED BEFORE THE END OF THE SECOND
BUSINESS DAY AFTER EXECUTION. IF THE REQUEST FOR WITHDRAWAL IS TRANSMITTED
ORALLY, WRITTEN CONFIRMATION MUST BE GIVEN. ANY PERSON WHO PURCHASES INTERESTS
WHO IS A PENNSYLVANIA RESIDENT WILL NOT SELL SUCH INTERESTS FOR A PERIOD OF
TWELVE (12) MONTHS BEGINNING WITH THE CLOSING DATE. PENNSYLVANIA RESIDENTS MUST
HAVE EITHER (i) A MINIMUM NET WORTH OF THIRTY THOUSAND ($30,000) DOLLARS
(EXCLUDING HOME, HOME FURNISHING AND AUTOMOBILES) AND A MINIMUM ANNUAL GROSS
INCOME OF THIRTY THOUSAND ($30,000) DOLLARS, OR (ii) A NET WORTH OF AT LEAST
SEVENTY FIVE THOUSAND ($75,000) DOLLARS (AS COMPUTED ABOVE0, AND MAY NOT INVEST
MORE THAN TEN (10%) PER CENT OF THEIR NET WORTH (EXCLUSIVE OF THE SUBSCRIBER'S
HOME, HOME FURNISHINGS AND AUTOMOBILES).
NOTICE TO SOUTH CAROLINA RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
SOUTH CAROLINA UNIFORM SECURITIES ACT. A REGISTRATION STATEMENT RELATING TO
THESE SECURITIES HAS NOT BEEN FILED WITH THE SOUTH CAROLINA SECURITIES
COMMISSIONER. THE COMMISSIONER DOES NOT RECOMMEND OR ENDORSE THE PURCHASE OF ANY
SECURITIES, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF THIS OFFERING
MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NOTICE TO SOUTH DAKOTA RESIDENTS
THE SHARES HAVE NOT BEEN REGISTERED UNDER CHAPTER 47.31 OF THE SOUTH
DAKOTA SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
FOR VALUE EXCEPT PURSUANT TO REGISTRATION, EXEMPTION THEREFROM OR OPERATION OF
LAW.
SOUTH DAKOTA RESIDENTS MUST HAVE EITHER (i) A MINIMUM NET WORTH OF AT
LEAST SIXTY THOUSAND ($60,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND A MINIMUM GROSS INCOME OF SIXTY THOUSAND ($60,000) DOLLARS, OR
(ii) A NET WORTH OF AT LEAST TWO HUNDRED TWENTY FIVE THOUSAND ($225,000) DOLLARS
(AS COMPUTED ABOVE).
NOTICE OF TENNESSEE RESIDENTS
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY ANY INVESTOR
SHALL NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE OF TEXAS RESIDENTS
THIS OFFERING MEMORANDUM IS FOR THE INVESTOR'S CONFIDENTIAL USE AND MAY NOT
BE REPRODUCED. ANY ACTION CONTRARY TO THESE RESTRICTIONS MAY PLACE SUCH INVESTOR
AND THE ISSUER IN VIOLATION OF THE TEXAS SECURITIES ACT.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY ANY INVESTOR
SHALL NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE TO UTAH RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UTAH SECURITIES ACT AND
MAY NOT NE SOLD WITHOUT REGISTRATION UNDER THAT ACT OR EXEMPTION THEREFROM.
NOTICE TO WASHINGTON RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE WASHINGTON SECURITIES
ACT AND THE ADMINISTRATOR OF SECURITIES OF THE STATE OF WASHINGTON HAS NOT
REVIEWED THE OFFERING OR OFFERING MEMORANDUM. THESE SECURITIES MAY NOT BE SOLD
WITHOUT REGISTRATION UNDER THE ACT OR EXEMPTION THEREFROM.
IT IS THE RESPONSIBILITY OF ANY INVESTOR PURCHASING SHARES TO SATISFY
ITSELF AS TO FULL OBSERVANCE OF THE LAWS OF ANY RELEVANT TERRITORY OUTSIDE THE
UNITED STATES IN CONNECTION WITH ANY SUCH PURCHASE, INCLUDING OBTAINING ANY
REQUIRED GOVERNMENTAL OR OTHER CONSENTS OR OBSERVING ANY OTHER APPLICABLE
REQUIREMENTS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OF ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS, ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE SECURITIES ARE OFFERED BY THE COMPANY SUBJECT TO PRIOR SALE,
ACCEPTANCE OR AN OFFER TO PURCHASE, WITHDRAWAL, CANCELLATION OR MODIFICATION OF
THE OFFER, WITHOUT NOTICE. THE COMPANY RESERVES THE RIGHT TO REJECT ANY ORDER,
IN WHOLE OR IN PART, FOR THE PURCHASE OF ANY OF THE SECURITIES OFFERED HEREBY.
OFFERING SUMMARY
The following summary information is qualified in its entirety by the
detailed information appearing elsewhere in this Memorandum.
IPVoice Communications, Inc. was founded in September 1997 to provide a
vehicle for key software technologies and a Research and Development laboratory
for the emerging Voice over the Internet market. IPVoice core software
technologies require little additional development to produce market viability.
New technologies presently under development such as TrueConnect may require
additional financial support to bring them to the marketplace.
RISK FACTORS
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE
OF RISK. ONLY THOSE PERSONS ABLE TO LOSE THEIR ENTIRE INVESTMENT SHOULD PURCHASE
THESE SECURITIES. PROSPECTIVE INVESTORS, PRIOR TO MAKING AN INVESTMENT DECISION,
SHOULD CAREFULLY READ THIS PROSPECTUS AND CONSIDER, ALONG WITH OTHER MATTERS
REFERRED TO HEREIN, THE FOLLOWING RISK FACTORS.
Risk Factors Relating to the Business of the Company
Development Stage Company The Company has had limited revenues from
operations since its organization and is a "start-up" or "development stage"
company. No assurances can be given that the Company will be able to compete
with other companies in its industry. The purchases of the securities offered
hereby must be regarded as the placing of funds at a high risk in a new or
"start-up" venture with all the unforeseen costs, expenses, problems, and
difficulties to which such ventures are subject. See "Use of Proceeds" and "The
Company."
No Assurance of Profitability To date, the Company has not generated
significant revenues from operations. The Company can not ensure significant
revenues in the near future. The Company's ability to successfully implement its
business plan is dependent on the completion of this Offering. There can be no
assurance that the Company will be able to develop into a successful or
profitable business.
No Assurance of Payment of Dividends. No assurances can be made that
the future operations of the Company will result in additional revenues or will
be profitable. Should the operations of the Company become profitable, it is
likely that the Company would retain much or all of its earnings in order to
finance future growth and expansion. Therefore, the Company does not presently
intend to pay dividends, and it is not likely that any dividends will be paid ln
the foreseeable future.
Possible Need for Additional Financing. The Company intends to fund its
operations and other capital needs for the next 24 months substantially from the
proceeds of this Offering and another (506) offering, but there can be no
assurance that such funds will be sufficient for these purposes. The Company may
require additional amounts of capital for its future expansion, operating costs
and working capital. The Company has made no formal arrangements to obtain
future additional financing, and if required, there can be no assurance that
such financing will be available, or that such financing will be available on
acceptable terms. See "Use of Proceeds."
Dependence on Management The Company's success is principally dependent
on its current management personnel for the operation of its business.
Broad Discretion in Application of Proceeds. The management of the
Company has broad discretion to adjust the application and allocation of the net
proceeds of this offering, in order to address changed circumstances and
opportunities. As a result of the foregoing, the success of the Company will be
substantially dependent upon the discretion and judgment of the management of
the Company with respect to the application and allocation of the net proceeds
hereof. Pending use of such proceeds, the net proceeds of this offering will be
invested by the Company in temporary, short-term interest-bearing obligations.
See "Use of Proceeds."
Arbitrary Offering Price. The price to the public of the Shares offered
hereby has been arbitrarily determined by the Company and bears no relationship
to the Company's earnings, book value or any other recognized criteria of value.
Immediate and Substantial Dilution. An investor in this offering may
experience immediate and substantial dilution.
Limited Market for Securities of the Company. A limited market has
existed for the securities being offered hereby and no assurance can be given
that a market will develop subsequent to this Offering.
No Escrow of Investors' Funds. This offering is being made on a "best
efforts, no minimum basis" As such, all the funds from this Offering will be
immediately available to the Company.
No Assurance of Acquisition While it is the Company's intent to acquire
either all of the shares or assets of other industry related companies in
addition to expanding its own operations, there is no assurance that the Company
will be able to achieve this goal. That event could cause a materially adverse
affect on the future of the Company.
Forward-Looking Statements This Memorandum includes "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All
statements, other than statements of historical facts, included or incorporated
by reference in this Memorandum which address activities, events or developments
which the Company expects or anticipates will or may occur in the future,
including such things as capital expenditures (including the amount and nature
thereof), expected sales revenues, 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 under the circumstances. However, whether actual
results and developments will conform with the Company's expectations and
predictions is subject to a number of risks and uncertainties, including the
risk factors discussed in this Memorandum, general economic, market or business
conditions, the business opportunities (or lack thereof) that may be presented
to and pursued by the Company, changes in laws or regulations, and other
factors, some of which are beyond the control of the Company. Consequently, all
of the forward-looking statements made in this Memorandum 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 consequences to or
effects on the Company or its business or operations. The Company assumes no
obligation to update any such forward-looking statements.
THE COMPANY
Introduction
In the fast moving world of communications, especially Internet
telephony, the companies with systems in the market are just now battling
between open and closed systems. IPVoice has developed open systems and will
have an edge on the competition in more ways than one.
With the meteoric rise of the Internet (which is predicted to continue
at a staggering rate), and the obvious savings that Internet telephony can
provide, the future looks bright. In the multi-billion dollar telephone
industry, IPVoice does not have to compete with AT&T and MCI. A small Internet
telephone company can create significant revenues without ever disturbing the
major players and thus having to compete with them in advertising or
price-warring for market share. As the Internet telephony segment continues to
grow and break out, which many industry analysts predict it surely will, it is
an area that the large companies will certainly look to enter, probably through
acquisitions. In that scenario, with their installed client base and established
network customers well entrenched, their international presence developed, and
their forward-thinking software developed, tested and already implemented,
IPVoice could be perfectly positioned to become a prime buyout candidate.
The Company
IPVoice Communications, Inc., a Nevada corporation of which IPVoice
Communications, Inc., a Delaware corporation, is a wholly owned subsidiary
(hereafter collectively referred to as "IPVoice" or the "Company") was
originally formed in September 1997. The company was established with the
intention of developing its MultiCom Business Management Software (developed by
Xxxxxxx Xxxxx, installed and ran in a Carrier grade switching environment for
over three years) to interact with voice over the internet application under the
product name of TrueConnect. By introducing Carrier grade Business Management
into the marketplace, IPVoice is poised to take advantage of the explosive
potential in Internet telephony. IPVoice is preparing to deliver products that
allow companies and individuals to route their phone calls, faxes, and other
data across the Internet at substantial cost savings with limited sacrifice of
quality compared to traditional telephone networks.
IPVoice's unique; state-of-the-art software and hardware solutions will
bridge the gap between the telephone and the Internet. IP Telephony has been
heralded as the foundation for a new class of telecommunication applications
which promise to be as common as your desktop phone. This new technology, when
exposed to the deregulated communications marketplace, will offer tremendous
opportunity for young, Internet technology companies. Smaller companies which
can easily assimilate new technology and which can quickly adapt to inevitable
changes in the Internet, are expected to take xxxxxx advantage of the market
created for such products. IPVoice intends to make an impact on the Internet
Telephony market by setting the standard for billing, management network and
marketing programs.
The Exploding Internet Market
The potential market for Internet telephony is awesome. Industry analysts
speculate that revenues could grow sixteen-fold between 1995 and the turn of the
century.
[GRAPHIC OMITTED]
International Data Corporation (IDC) has predicted that the IP Telephony
market will be worth $560 million in 1999 with annual growth of over 382%
(CAGR).
Internet Telephony
Traditional telephone networks give every call a nailed-down circuit. This
means that a dedicated circuit must be utilized for the full time that the call
is connected. This wastes precious expensive resources because only one person
can talk at a time and also because there are breaks in the conversation. In a
normal conversation, one person speaks while the other listens. This wastes half
of the capacity of the dedicated circuit. At best, a traditional telephone
network uses 25% of the capacity of each call. This significantly inflates the
costs of making calls.
IP stands for Internet Protocol. IP is the most significant of the
protocols on which the Internet (and thus the World Wide Web) is based. It
allows a packet of information (voice, video, e-mail, data, images, etc.) to
cross multiple networks on its way to its final destination. Thus, instead of
having one dedicated circuit for a call, the entire network is shared. The
"conversation" (voice, data, images, video, etc.) is split into many small
packets and each packet is sent down whichever path is open at that time.
Packets are reassembled at the destination. Until recently, packet switching was
very slow. New technology can zip packets around networks at lightning speed.
Fast packet networks will make voice sound as good (and possibly better) than
the circuit-switched voice networks used currently.
Companies using IPVoice's technology can achieve savings of 30% to 70% over
circuit-switched voice. The estimated saving on expensive international calls is
remarkable.
The following graph shows the market predictions of the emerging IP
Telephony industry (Source: Frost & Xxxxxxxx):
[GRAPHIC OMITTED]
$1.81 Billion, Compound Annual Growth Rate: 149% for the period
Leading Edge Products
IPVoice products have been designed and produced by the Company at its
research and development site located in Denver, Colorado. IPVoice products are
made from company-designed software and hardware as well as materials purchased
from a few major suppliers. The Company has two sites operational and is
preparing to deploy TrueConnect Gateways in the Domestic and International arena
in the first quarter 1999.
The launch of TrueConnect follows three years of extensive research and
development, field-testing and trials on MultiCom, which is the business
management system behind TrueConnect. TrueConnect provides a gateway for
bridging the public telephone system with the Internet. With TrueConnect, users
will be able to conduct real-time, full duplex, high quality two-way voice
communications over the Internet. This method promises substantial savings
compared to standard long distance telecommunications services.
To support the True Connect product, the Company has completed several
proprietary products that will allow the Company and its distributors to offer a
total solution in Internet Telephony. These products including MultiCom, offer a
complete order entry, billing, customer service, agent management and switching
network management system for telecommunications businesses worldwide.
AuditRite, is a software module add-in for the MultiCom system that allows
MultiCom to read and interpret carrier-supplied data-tapes. The AuditRite system
provides a powerful tool for analyzing call patterns and finding possible errors
in a vendor's billing. The Company has also developed 4Com for Summa Four
switches, ICBConnect for Xxxxxx switches and TrueWeb1, which when introduced to
the world of IP Telephony, will change the way businesses function.
The hardware technology to route calls over the Internet (Internet
Telephony) has existed for about three years. Put simply, because it avoids
traditional telephone networks, Internet Telephony is faster, more direct and
efficient, and therefore ultimately cheaper than traditional telephone networks.
As such, Internet Telephony possesses an immediate and incredible opportunity
for those companies developing the software to harness and direct the
technology. The competition in the industry is presently focused on the software
applications necessary to operate an Internet Telephony network.
In simplest terms, the business of telephone companies is to sell minutes.
Blocks of minutes represent the commodity of the industry. The more minutes you
can switch through your network switches, the more money you make. The way
established phone networks are set up, a call from your home to New York City
will pass through switches belonging to your local provider, a regional
provider, a national provider, a second regional provider and the local provider
on the other end. Everyone gets a bite of the "per minute charge". Internet
Telephony provides the ability to leapfrog the middle men, thereby creating a
huge dollar savings to the customer, as well as allow immediate monitoring of
your telephone services that have never been available until now.
Where the rubber meets the road in the industry is in the software
applications that control everything from routing to billing. It is in this new
and wide open market that IP Voice stakes its claim to being the Best in the
Industry. The companies that have gotten into the industry have concentrated on
software that simply switches the minutes across the network, without concerning
themselves about how they would manage the network, conduct billing, and
implement feature functionality. Telecommunications technology expert Xxxxxxx
Xxxxx, who is Executive Vice President of IP Voice, developed the MultiCom,
AuditRite and TrueConnect platforms (all of which have received wide recognition
in this fledgling industry) that are totally unique to IP Voice, and were
designed to handle all the manageability and billing and design upgrades and
service options that this exploding technology will soon need.
1 The IPVoice TrueWeb product is a complete business management system available
over the Web and is scheduled for release soon.
The company believes that its closest competition is at least 12 months
behind IPVoice in terms of its software capability, and it may take even longer
for the competition to provide the same services IPVoice has had in operation
for several years. Lucent is only now buying up companies that it will use to
develop this technology. In the time it takes the rest of the industry to catch
up, IPVoice, with former MCI top marketing executive Xxxxxxx X. Will at the
helm, will have established its network and be on its way to providing newer and
better services. (The company randomly changes its source code on its software,
up to four times daily, to prevent any pirating of its technology.)
The unique aspects of IP Voice's software include:
Real Time Billing - Currently offered by no one in the telephone industry, real
time billing provides a customer with the ability to secure reports on their
volume of calls, locations called and exact amount owed, among a host of other
features.
Full Feature Functionality - IPVoice can add services to its software at will,
as they come on line or when requested by a customer. Moreover, traditional
phone companies are saddled with huge costs and implementation times, as they
update each switch individually across their network. IPVoice can update its
entire International Network from its home base.
Unrivaled Agent Control - A single agent can sit in front of a Gateway terminal
and control the entire operation. Moreover, IPVoice can directly control the
entire network from its main office in the U.S. This has huge implications on
the commercial side, adding and servicing customers.
IPVoice's architecture can switch through multiple networks, both Internet
and traditional, giving it a unique universal application. No other stand-alone
switch can do this. The IPVC Gateways also boast a unique open architecture,
which means that the gateways can both send and receive calls from any other
telephone carrier in the market. Everyone else is limited to receiving calls
only.
IPVoice's Gateway switches cost a partner $65,000 installed (and cost the
company even less if it installs them itself), while a similar traditional
switch, with all the attendant hardware and support for services and billing
functions, would cost anywhere from $500,000 to $5 million.
Debit Card and Calling Card functions are built into the Gateway, also a
unique function. The software modules have been designed to work seamlessly and
efficiently with each other, to provide the most extensive and well thought out
approach to the business end of the technology.
Given its technology, IPVoice's business plan is simple and flexible. They
can set up their own switches, or partner with a local switching business and
take a percentage of the minutes. The gateways can route calls over the Internet
where their network is established, or use traditional phone lines when desired
or necessary (special features allow a savings even when traditional phone lines
are used, and IPVoice can also procure bulk minutes at a lower rate). The
Company has several Letters of Intent with partners around the world, and is set
to ship the first units in the first part of 1999. Therefore, IPVoice is a
company ready to capitalize on its technologically superior position in a
rapidly rising industry.
Focused Business Strategy
IPVoice intends to corner the market with these products, not only because
they will be the first its kind, but because competitors will spend years of
time and countless research dollars only to develop similar products.
Within the IP telephony world, few companies stand apart from the rest as
"market leaders" and are invariably the companies relied upon when seeking new
technology. Although these companies may have been reliable in the past, their
future performances can be no better than their underlying hardware. (One such
company uses Natural MicroSystems, Inc.) IPVoice's systems are scalable along
with centralized accounting which also has redundancy built into the
environment. IPVoice's technology could transform competitors into customers, as
IPVoice's billing and management software can communicate with other platforms
due to its own open platform design. The industry leaders lack a critical
component to their solutions: effective data-management and billing.
With the recent acquisition of key technologies and the emergence of the IP
telephony market, IPVoice stands in a unique position:
I. No competitor equals the IPVoice combined IP telephony solution and
mature, real-time billing system for ease of use, affordability and
quality. All competing IP telephony solutions in the marketplace today
have immature billing systems.
II. No other telecommunications group can provide the same level of
real-time remote access and manageability of information.
III. No other group can offer the same level of customer and agent access.
The resulting sales momentum from empowering the remote agents will
create a self-driving sales force unparalleled in the industry.
IV. With IPVoice's industry-unique combination of IP telephony technology,
Internet remote-access technology, and a comprehensive order-entry and
invoicing system, IPVoice can instantly address and secure new
marketplaces and opportunities.
IPVoice products, utilizing specially developed proprietary software, will
provide ongoing revenues from calls made whether voice or data. All of the
Company's products are available for a minimal capital investment of $65,000.
The Company is exploring possible relationships with venture capital groups and
private investment concerns. TruePartners who have already signed Letters of
Intent are being sent their contracts so that the Company can start deployment
of its TrueConnect Gateways. The Company has secured seven LOI's and is anxious
to move forward with product into the marketplace via new, as well as
established, independent representatives and distributors, under the direction
of the Company's President, Xxxxxxx Will.
Ms. Will's close association with key organizations and individuals will
support the Company's marketing efforts, as a result of her prior experience in
a senior capacity with MCI. These contacts should prove invaluable during these
marketing and sales activities.
The Company has targeted International markets and will support its sales
efforts by participating in trade shows targeting the telecommunication industry
and large businesses, as well as through professional articles, peer- reviewed
studies, direct calls and a comprehensive marketing campaign. After purchasing
the products from the Company, IPVoice customers will use network services to be
developed by the Company and offered at extremely competitive rates. The Company
believes it is well placed to capitalize on this very large and potentially
profitable opportunity.
Locations assigned IPVoice TruePartners and awaiting deployment:
Hong Kong Madrid Paris
Taiwan London Caribbean
China New York Panama
Greece Costa Rica Mexico
Revenue from Distribution Channels
Management of the Company is anticipating gross margins to be
approximately 42% on sales of IPVoice products.
MANAGEMENT
The following sets forth the names of the Company's officers and
directors:
XXXXXXX WILL PRESIDENT, CHIEF OPERATING OFFICER AND CHAIRPERSON
Xxxxxxx Will has over 20 years of experience in all areas of
telecommunications, domestic and international. She spent the last 11 years with
MCI. Her broad spectrum of involvement included Major Accounts, National
Accounts, Hospitality, and Carriers/Resellers who provided MCI with revenues of
between $35 to $130 million. Ms. Will was responsible for signing some of the
largest contracts with a carrier/reseller in MCI's history. Her vast industry
experience encompasses, but is not limited to, international and international
private line; International Toll-Free; data; DSO, XXX, XXX, XX0; dedicated in
and outbound; One-Plus; calling and debit cards; Operator Assistance; Internet;
Enhanced Services; and Enhanced Network.
During her time at MCI she received numerous awards for outstanding
performance and was recognized as having successfully obtained one of the
largest private-line contracts in the history of MCI. Ms. Will attended Colorado
State University, and graduated with a Communications and Business
Administration degree.
XXXXXXX X. XXXXX EXECUTIVE VICE PRESIDENT OF R&D AND DIRECTOR
Xx. Xxxxx is the original designer of the MultiCom, AuditRite, and True
Connect platforms and has served as Special Consultant to various
telecommunications organizations. Xx. Xxxxx is the driving force behind the
IPVoice technologies and has been instrumental in providing critical technology
solutions. He has been a key player in creating viable proposals and business
strategies for technology solutions and joint ventures. He has provided key
technology and management solutions to many telecommunications companies. Xx.
Xxxxx is responsible for maintaining the Company's superior position in the
industry by producing continuous innovations in IPVoice's technology.
Xx. Xxxxx has served as Special Consultant and Project Design Leader
for such organizations as Wal-Mart International (US HQ and Mexico City Branch),
Nation's Bank CS Headquarters, Frito-Lay Worldwide Headquarters, NEC America
Mobile Radio/Cellular/Pager Division Headquarters, and Southwestern Xxxx Mobile
(Cellular/Pager) Systems Headquarters.
Xx. Xxxxx has received numerous awards and recognition for his work in
Artificial Intelligence-both in military and academic circles-and has applied
this experience to creating technology solutions that are both intelligent and
flexible in nature. The technology behind the MultiCom system has received
recognition from several telecom trade magazines ("Computer Telephony" and
"Telephony" magazines). Xx. Xxxxx won first place in the International Science
competition for Artificial Intelligence at just 17 years of age. He attended the
University of Mississippi and was the first freshman in the history of the
college to be admitted into the artificial intelligence Ph. D. Program.
XXXXXXX XXXXX VICE PRESIDENT OF RESEARCH & DEVELOPMENT
Xxxxxxx XxXxx is responsible for designing and developing the interface
between the telephony hardware and the TrueConnect gateway software. Xx. XxXxx
will also be responsible for the technical pre-sales support and post-sale
installation support. Xx. XxXxx has a master degree in electrical engineering
and has been involved with automation for over 12 years with extensive
experience in developing business applications.
CONSULTANTS
XXX XXXXXXX SOFTWARE DEVELOPMENT
Xx. Xxxxxxx is responsible for maintaining and creating enhancements to
the MultiCom system and is the Project Manager for all MultiCom systems. He is a
widely experienced data processing engineer with a solid background in analysis,
design and problem solving on mainframe, mini and PC based systems. Prior to
joining IPVoice, Xx. Xxxxxxx had worked on software solutions for
Deloitte-Touche, Trinary Systems, IGT, Inc., and others.
Xx. Xxxxxxx has worked with the MultiCom technology for over two years
and thus is highly qualified to maintain and enhance the MultiCom system.
Xx. Xxxxxxx brings over 27 years of system development experience in
the Information Technology industry and has been witness to and participated in
many technological advances with computers and design methodologies.
Xx. Xxxxxxx is a graduate of the US Army College.
PRINCIPAL SHAREHOLDERS
Prior to this offering, the Company had 13,006,091 shares of its Common
Stock issued and outstanding. The following table sets forth, as of February 1,
1999, the beneficial ownership of the Company's Common Stock (i) by the only
persons who are known by the Company to own beneficially more than 5% of the
Company's Common Stock; (ii) by each officer and director of the Company; and
(iii) by all directors and officers as a group.
Name Number of Shares Percentage Owned Percentage Owned
Owned Prior to Offering Before Offering After Offering
Xxxxxxx X. Will 3,000,000 29% 26%
Condor Worldwide Ltd. 3,000,000 29% 26%
Xxxxxxx X. Xxxxx 3,000,000 29% 26%
--------------------------------------------------------------------------------------------
Officers and Directors 6,000,000 58% 53%
as a group
USE OF PROCEEDS
The Company plans to utilize the proceeds of this Offering for working
capital and for further research and development necessary to complete its
TrueConnect product and to start deployment.
DESCRIPTION OF SECURITIES
Shares The Company is hereby offering a "best efforts, no minimum basis"
1,250,000 shares of its Common Stock at a price of $0.40 per share.
Common Stock
The authorized capital stock of the Company consists of 20,000,000
shares of Common Stock, $.001 par value. Holders of the Common Stock do not have
preemptive rights to purchase additional shares of Common Stock or other
subscription rights. The Common Stock carries no conversion rights and is not
subject to redemption or to any sinking fund provisions. All shares of Common
Stock are entitled to share equally in dividends from sources legally available
therefor when, as and if declared by the Board of Directors and, upon
liquidation or dissolution of the Company, whether voluntary or involuntary, to
share equally in the assets of the Company available for distribution to
stockholders. All outstanding shares of Common Stock are validly authorized and
issued, fully paid and nonassessable, and all shares to be sold and issued as
contemplated hereby, will be validly authorized and issued, fully paid and
nonassessable. The Board of Directors is authorized to issue additional shares
of Common Stock, not to exceed the amount authorized by the Company's
Certificate of Incorporation, on such terms and conditions and for such
consideration as the Board may deem appropriate without further stockholder
action. The above description concerning the Common Stock of the Company does
not purport to be complete. Reference is made to the Company's Certificate of
Incorporation and Bylaws which are available for inspection upon proper notice
at the Company's offices, as well as to the applicable statutes of the State
of Nevada for a more complete description concerning the rights and liabilities
of stockholders.
Prior to this offering, there has been a limited market for the Common
Stock of the Company, and no predictions can be made of the effect, if any, that
market sales of shares or the availability of shares for sale will have on the
market price prevailing from time to time. Nevertheless, sales of significant
amounts of the Common Stock of the Company in the public market may adversely
affect prevailing market prices, and may impair the Company's ability to raise
capital at that time through the sale of its equity securities.
Each holder of Common Stock is entitled to one vote per share on all
matters on which such stockholders are entitled to vote. Since the shares of
Common Stock do not have cumulative voting rights, the holders of more than 50
percent of the shares voting for the election of directors can elect all the
directors if they choose to do so and, in such event, the holders of the
remaining shares will not be able to elect any person to the Board of Directors.
Preferred Stock
The authorized capital stock of the Company also consists of 1,000,000
shares of Preferred Stock, $.001 par value, none of which are issued.
PLAN OF DISTRIBUTION
The Company has no underwriter for this Offering. The Offering is
therefore self-underwriting. The Shares offered hereby will be offered by the
Company at a price of $0.40 per share.
Price of the Offering.
There is a limited market for the Shares, and there is no guaranty that
a market will continue or further develop for the Company's shares.
Consequently, the offering price has been determined by the Company. Among other
factors considered in such determination were estimates of business potential
for the Company, the Company's financial condition, an assessment of the
Company's management and the general condition of the securities market at the
time of this Offering. However, such price does not necessarily bear any
relationship to the assets, income or net worth of the Company.
The offering price should not be considered an indication of the actual
value of the Shares. Such price is subject to change as a result of market
conditions and other factors, and no assurance can be given that the Shares can
be resold at the Offering Price.
There can be no assurance that an active trading market will develop
upon completion of this Offering, or if such market develops, that it will
continue. Consequently, purchasers of the Shares offered hereby may not find a
ready market for Shares.
CAUTIONARY WARNING
THE COMPANY'S BUSINESS PLAN AND THE COMPANY'S FINANCIAL STATEMENTS AND
PROJECTIONS ARE FORWARD LOOKING. STATEMENT AND ACTUAL RESULTS COULD
MATERIALLY DIFFER FROM THE PROJECTIONS. AS SUCH, NO INVESTOR SHOULD RELY ON
SUCH INFORMATION IN MAKING HIS INVESTMENT.
ADDITIONAL INFORMATION
Each investor warrants and represents to the Company that, prior to making an
investment in the Company, that he has had the opportunity to inspect the books
and records of the Company and that he has had the opportunity to make inquiries
to the officers and directors of the Company and further that he has been
provided full access to such information.
INVESTOR SUITABILITY STANDARDS AND
INVESTMENT RESTRICTIONS
------------------------------------
Suitability
Shares will be offered and sold pursuant an exemption under the
Securities Act, and exemptions under applicable state securities and Blue Sky
laws. There are different standards under these federal and state exemptions
which must be met by prospective investors in the Company.
The Company will sell Shares only to those Investors it reasonably
believes meet certain suitability requirements described below.
Each prospective Investor must complete a Confidential Purchaser
questionnaire and each Purchaser Representative, if any, must complete a
Purchaser Representative Questionnaire.
EACH INVESTOR MUST BE RESPONSIBLE FOR DETERMINING THAT IT IS PERMITTED
TO INVEST IN THE COMPANY, THAT ALL APPROPRIATE ACTIONS TO AUTHORIZE SUCH AN
INVESTMENT HAVE BEEN TAKEN, AND THAT ANY REQUIREMENTS THAT ITS INVESTMENTS BE
DIVERSIFIED OR SUFFICIENTLY LIQUID HAVE BEEN MET.
An investor will qualify as an accredited Investor if it falls within
any one of the following categories at the time of the sale of the Shares to
that Investor:
(1) A bank as defined in Section 3(a)(2) of the Securities Act, or a
savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934; an insurance company as defined in Section 2(13) of the
Securities Act; an investment company registered under the Investment Company
Act of 1940 or a business development company as defined in Section 2(a)(48) of
that Act; a Small Business Investment Company licensed by the United States
Small Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
political subdivisions, or any agency or instrumentality of a state or its
political subdivisions, for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974, if the investment decision
is made by a plan fiduciary, as defined in Section 3(21) of that Act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000, or, if a self-directed plan with the investment decisions made
solely by persons that are accredited investors;
(2) A private business development company as defined in Section 202(a)
(22) of the Investment Advisers Act of 1940;
(3) An organization described in Section 501(c)(3) of the Internal
Revenue Code with total assets in excess of $5,000,000;
(4) A director or executive officer of the Company.
(5) A natural person whose individual net worth, or joint net worth
with that person's spouse, at the time of such person's purchase of the Shares
exceeds $1,000,000;
(6) A natural person who had an individual income in excess of $200,000
in each of the two most recent years or joint income with that person's spouse
in excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year;
(7) A trust with total assets in excess of $5,000,000, not formed for
the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as describe in Rule 506(b)(2)(ii) of
Regulation D; and
(8) An entity in which all of the equity owners are accredited
investors (as defined above).
As used in this Memorandum, the term "net worth" means the excess of
total assets over total liabilities. In computing net worth for the purpose of
(5) above, the principal residence of the investor must be valued at cost,
including cost of improvements, or at recently appraised value by an
institutional lender making a secured loan, net of encumbrances. In determining
income an investor should add to the investor's adjusted gross income any
amounts attributable to tax exempt income received, losses claimed as a limited
partner in any limited partnership, deductions claimed for depletion,
contributions to an XXX or XXXXX retirement plan, alimony payments, and any
amount by which income form long-term capital gains has been reduced in arriving
at adjusted gross income.
In order to meet the conditions for exemption from the registration
requirements under the securities laws of certain jurisdictions, investors who
are residents of such jurisdiction may be required to meet additional
suitability requirements.
An Investor that does not qualify as an accredited Investor is a
non-accredited Investor and may acquire Shares only if:
(1) The Investor is knowledgeable and experienced with respect to
investments in limited partnerships either alone or with its Purchaser
Representative, if any; and
(2) The Investor has been provided access to all relevant documents it
desires or needs; and
(3)The Investor is aware of its limited ability to sell and/or transfer
its Shares in the Company; and
(4) The Investor can bear the economic risk (including loss of the
entire investment) without impairing its ability to provide for its financial
needs and contingencies in the same manner as it was prior to making such
investment.
THE COMPANY RESERVES THE RIGHT IN ITS ABSOLUTE DISCRETION TO DETERMINE IF A
POTENTIAL INVESTOR MEETS OR FAILS TO MEET THE SUITABILITY STANDARDS SET
FORTH IN THIS SECTION.
Additional Suitability Requirements for Benefit Plan Investors
In addition to the foregoing suitability standards generally applicable
to all Investors, the Employee Retirement Income Security Act of 1934, as
amended ("ERISA"), and the regulations promulgated thereunder by the Department
of Labor impose certain additional suitability standards for Investors that are
qualified pension, profit-sharing or stock bonus plans ("Benefit Plan
Investor"). In considering the purchase of Shares, a fiduciary with respect to a
prospective Benefit Plan Investor must consider whether an investment in the
Shares will satisfy the prudence requirement of Section 404(a)(1)(B) of ERISA,
since there is not expected to be any market created in which to sell or
otherwise dispose of the Shares. In addition, the fiduciary must consider
whether the investment in Shares will satisfy the diversification requirement of
Section 404(a)(1)(C) of ERISA.
Restrictions on Transfer or Resale of Shares
The Availability of Federal and state exemptions and the legality of
the offers and sales of the Shares are conditioned upon, among other things, the
fact that the purchase of Shares by all Investors are for investment purposes
only and not with a view to resale or distribution. Accordingly, each
prospective Investor will be required to represent in the Subscription Agreement
that it is purchasing the Shares for its own account and for the purpose of
investment only, not with a view to, or in accordance with, the distribution of
sale of the Shares and that it will not sell, pledge, assign or transfer or
offer to sell, pledge, assign or transfer any of its Shares without an effective
registration statement under the Securities Act, or an exemption therefrom
(including an exemption under Regulation D, Section 504) and an opinion of
counsel acceptable to the Company that registration under the Securities Act is
not required and that the transaction complies with all other applicable Federal
and state securities or Blue Sky laws.
(The remainder of this page intentionally left blank)
CONFIDENTIAL
IP Voice Communications, Inc., a Nevada corporation
INVESTOR SUITABILITY EVALUATION QUESTIONNAIRE
1. NAME ________________________________________________
2. ADDRESS ________________________________________________
------------------------------------------------
3. PHONE Residence ( )_________________________________
Business ( )_________________________________
4. SOCIAL SECURITY NUMBER _______________________________
TAX IDENTIFICATION NUMBER _______________________________
5. DATE OF BIRTH _________________________________________________
6. REPRESENTATIONS (Investor should initial the appropriate blanks to
which an affirmative representation can be made)
_______________The total purchase price does not exceed twenty percent
(20%) of my net worth at the time of the sale and my
subscription is at least One Hundred Fifty Thousand
Dollars ($150,000.00).
_______________I have a net worth of One Million Dollars($1,000,000.00)
or more.
_______________I have an income of Two Hundred Thousand Dollars
($200,000.00) or more in each of the past two (2) years
and during the current year.
_______________The total purchase price does not exceed twenty percent
(20%) of my net worth.
I further represent that I can bear the economic risk of this
investment and that I have substantial experience in making investment decisions
of this type.
------------------------------
Signature of Investor
Date:___________________________ ______________________________
Name of Investor
INVESTOR SUITABILITY STANDARDS AND
INVESTMENT RESTRICTIONS
------------------------------------
Suitability
Shares will be offered and sold pursuant to an exemption under the
Securities Act, and exemptions under applicable state securities and Blue Sky
laws. There are different standards under these federal and state exemptions
which must be met by prospective investors in the Company.
The Company will sell Shares only to those Investors it reasonably
believes meet certain suitability requirements described below.
Each prospective Investor must complete a Confidential Purchaser
questionnaire and each Purchaser Representative, if any, must complete a
Purchaser Representative Questionnaire.
EACH INVESTOR MUST BE RESPONSIBLE FOR DETERMINING THAT IT IS PERMITTED
TO INVEST IN THE COMPANY, THAT ALL APPROPRIATE ACTIONS TO AUTHORIZE SUCH AN
INVESTMENT HAVE BEEN TAKEN, AND THAT ANY REQUIREMENTS THAT ITS INVESTMENTS BE
DIVERSIFIED OR SUFFICIENTLY LIQUID HAVE BEEN MET.
An investor will qualify as an accredited Investor if it falls within
any one of the following categories at the time of the sale of the Shares to
that Investor:
(1) A bank as defined in Section 3(a)(2) of the Securities Act, or a
savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934; an insurance company as defined in Section 2(13) of the
Securities Act; an investment company registered under the Investment Company
Act of 1940 or a business development company as defined in Section 2(a)(48) of
that Act; a Small Business Investment Company licensed by the United States
Small Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
political subdivisions, or any agency or instrumentality of a state or its
political subdivisions, for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974, if the investment decision
is made by a plan fiduciary, as defined in Section 3(21) of that Act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000, or, if a self-directed plan with the investment decisions made
solely by persons that are accredited investors;
(2) A private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940;
(3) An organization described in Section 501(c)(3) of the Internal
Revenue Code with total assets in excess of $5,000,000;
(4) A director or executive officer of the Company.
(5) A natural person whose individual net worth, or joint net worth
with that person's spouse, at the time of such person's purchase of the Shares
exceeds $1,000,000;
(6) A natural person who had an individual income in excess of $200,000
in each of the two most recent years or joint income with that person's spouse
in excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year;
(7) A trust with total assets in excess of $5,000,000, not formed for
the specific purpose of acquiring the securities offered, whose purchase is
directed by a sophisticated person as describe in Rule 506(b)(2)(ii) of
Regulation D; and
(8)An entity in which all of the equity owners are accredited investors
(as defined above).
As used in this Memorandum, the term "net worth" means the excess of
total assets over total liabilities. In computing net worth for the purpose of
(5) above, the principal residence of the investor must be valued at cost,
including cost of improvements, or at recently appraised value by an
institutional lender making a secured loan, net of encumbrances. In determining
income an investor should add to the investor's adjusted gross income any
amounts attributable to tax exempt income received, losses claimed as a limited
partner in any limited partnership, deductions claimed for depletion,
contributions to an XXX or XXXXX retirement plan, alimony payments, and any
amount by which income form long-term capital gains has been reduced in arriving
at adjusted gross income.
In order to meet the conditions for exemption from the registration
requirements under the securities laws of certain jurisdictions, investors who
are residents of such jurisdiction may be required to meet additional
suitability requirements.
An Investor that does not qualify as an accredited Investor is a
non-accredited Investor and may acquire Shares only if:
(1) The Investor is knowledgeable and experienced with respect to
investments in limited partnerships either alone or with its Purchaser
Representative, if any; and
(2) The Investor has been provided access to all relevant documents it
desires or needs; and
(3) The Investor is aware of its limited ability to sell and/or
transfer its Shares in the Company; and
(4) The Investor can bear the economic risk (including loss of the
entire investment) without impairing its ability to provide for its financial
needs and contingencies in the same manner as it was prior to making such
investment.
THE COMPANY RESERVES THE RIGHT IN ITS ABSOLUTE DISCRETION TO DETERMINE IF A
POTENTIAL INVESTOR MEETS OR FAILS TO MEET THE SUITABILITY STANDARDS SET
FORTH IN THIS SECTION.
Additional Suitability Requirements for Benefit Plan Investors
In addition to the foregoing suitability standards generally applicable
to all Investors, the Employee Retirement Income Security Act of 1934, as
amended ("ERISA"), and the regulations promulgated thereunder by the Department
of Labor impose certain additional suitability standards for Investors that are
qualified pension, profit-sharing or stock bonus plans ("Benefit Plan
Investor"). In considering the purchase of Shares, a fiduciary with respect to a
prospective Benefit Plan Investor must consider whether an investment in the
Shares will satisfy the prudence requirement of Section 404(a)(1)(B) of ERISA,
since there is not expected to be any market created in which to sell or
otherwise dispose of the Shares. In addition, the fiduciary must consider
whether the investment in Shares will satisfy the diversification requirement of
Section 404(a)(1)(C) of ERISA.
Restrictions on Transfer or Resale of Shares
The Availability of Federal and state exemptions and the legality of
the offers and sales of the Shares are conditioned upon, among other things, the
fact that the purchase of Shares by all Investors are for investment purposes
only and not with a view to resale or distribution. Accordingly, each
prospective Investor will be required to represent in the Subscription Agreement
that it is purchasing the Shares for its own account and for the purpose of
investment only, not with a view to, or in accordance with, the distribution of
sale of the Shares and that it will not sell, pledge, assign or transfer or
offer to sell, pledge, assign or transfer any of its Shares without an effective
registration statement under the Securities Act, or an exemption therefrom
(including an exemption under Regulation D, Section 504) and an opinion of
counsel acceptable to the Company that registration under the Securities Act is
not required and that the transaction complies with all other applicable Federal
and state securities or Blue Sky laws.
IPVoice Communications, Inc.
(A Nevada corporation)
==================
SUBSCRIPTION DATA SHEET
==================
Name of Subscriber
(Offeree):_______________________________________________________
Address of Residence
(if natural person):_____________________________________________
-----------------------------------------------------------------
Address of
Business:________________________________________________________
-----------------------------------------------------------------
Subscriber's
Telephone No.:___________________________________________________
Subscriber's Social
Security No. or
Tax I.D. No.:____________________________________________________
Preferred Address for
receiving mail:
( ) Residence
( ) Business
( ) Other, if any: _____________________________________________
-----------------------------------------------------------------
-----------------------------------------------------------------
Date of Subscription:____________________________________________
Amount of
Subscription: $_________________________________________________
SUBSCRIPTION AGREEMENT AND INVESTMENT
REPRESENTATION OF INVESTORS
IPVoice Communications, Inc.
0000 Xxxxx Xxxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Gentlemen:
1. Subject to the terms and conditions hereof, the undersigned,
intending to be legally bound, hereby irrevocably subscribes for and agrees to
accept and subscribe to _________ shares of Rule 504 common stock of IPVoice
Communications, Inc., a Nevada corporation (the Company), for a total
consideration of $_________, the receipt and sufficiency of which is hereby
acknowledged.
2. In order to induce the Company to accept the subscription made
hereby, the undersigned hereby represents and warrants to the Company, and each
other person who acquires or has acquired the Shares, as follows :
(a) The undersigned, if an individual (i) has reached the age
of majority in the state in which he resides and (ii) is a bona fide resident
and domiciliary (not a temporary or transient resident) of the state set forth
beneath his signature below.
(b) The undersigned has the financial ability to bear the
economic risk of an investment in the Shares has adequate means of providing for
his current needs and personal contingencies, has no need for liquidity in such
investment, and could afford a complete loss of such investment. The
undersigned's overall commitment to investments that are not readily marketable
is not disproportionate to his net worth, and his investment in the Company will
not cause such overall commitment to become excessive.
(c) The undersigned meets at least one of the following
criteria:
(i) the undersigned is a natural person whose individual
net worth or joint net worth with his spouse, at the
time of his purchase, exceeds $1,000,000 (ONE MILLION
DOLLARS); or
(ii) the undersigned is a natural person and had an
individual income in excess of $200,000 (TWO-HUNDRED
THOUSAND DOLLARS) in each of the two most recent years,
or jointly with his spouse in excess of $300,000
(THREE-HUNDRED THOUSAND DOLLARS) in each of those
years, and who reasonably expects to achieve at least
the same income level in the current year; or
(iii)qualifies as an accredited investor under Regulation D
of the Securities Act of 1933 (the "Act").
(d) The investment is one in which I am purchasing for myself
and not for others, the investment amount does not exceed 10% of my net worth
and I have the capability to understand the investment and the risk.
(e) The undersigned has been given a full opportunity to ask
questions of and to receive answers from the Company concerning the terms and
conditions of the offering and the business of the Company, and to obtain
additional information necessary to verify the accuracy of the information given
him or to obtain such other information as is desired in order to evaluate an
investment in the Shares. All such questions have been answered to the full
satisfaction of the undersigned.
(f) In making his decision to purchase the Shares herein
subscribed for, the undersigned has relied solely upon independent
investigations made by him. He has received no representation or warranty from
the Company or from a broker-dealer, if any, or any of the affiliates, employees
or agents of either. In addition, he is not subscribing pursuant hereto for any
Shares as a result of or subsequent to (i) any advertisement, article, notice or
other communication published in any newspaper, magazine or similar media or
broadcast over television or radio, or (ii) any seminar or meeting whose
attendees, including the undersigned, had been invited as a result of,
subsequent to, or pursuant to any of the foregoing.
(g) The undersigned understands that the Shares have not been
registered under the Act in reliance upon specific exemptions from registration
thereunder, and he agrees that his Shares may not be sold, offered for sale,
transferred, pledged, hypothecated, or otherwise disposed of except in
compliance with the Act and applicable state securities laws, which restrictions
require the approval of the Company for the transfer of any Shares (which
approval, except under limited circumstances, may be withheld by the Company in
its sole discretion). The undersigned has been advised that the Company has no
obligations to cause the Shares to be registered under the Act or to comply with
any exemption under the Act, including but not limited to that set forth in Rule
144 promulgated under the Act, which would permit the Shares to be sold by the
undersigned. The undersigned understands that it is anticipated that there may
not be any market for resale of the Shares, and that it may not be possible for
the undersigned to liquidate an investment in the Shares. The undersigned
understands the legal consequences of the foregoing to mean that he must bear
the economic risk of his investment in the Shares. He understands that any
instruments representing the Shares will bear legends restricting the transfer
thereof.
3. To the extent I have the right to rescind my purchase of the Shares,
which right of recission is hereby offered, I waive and relinquish such rights
and agree to accept certificate(s) evidencing such Shares.
4. This Agreement and the rights and obligations of the parties hereto
shall be governed by, and construed and enforced in accordance with, the laws of
the State of Nevada.
5. All pronouns contained herein and any variations thereof shall be
deemed to refer to the masculine, feminine or neuter, singular or plural, as the
identity of the parties hereto may require.
6. The shares referred to herein may be sold to the subscriber in a
transaction exempt under Section 517.061 of the Florida Securities Act. The
shares have not been registered under said act in the State of Florida. In
addition, if sales are made to five or more persons in the State of
Florida, any sale in the State of Florida is voidable by the purchaser within
three (3) days after the first tender of consideration is made by such purchaser
to the issuer, an agent of the issuer, or an escrow agent or within three (3)
days after the availability of that privilege is communicated to such purchaser,
whichever occurs later.
IN WITNESS WHEREOF, the undersigned has executed and agrees to be bound
by this Subscription Agreement and Investment Representation on the date written
below as the Date of Subscription:
(TO BE USED FOR INDIVIDUAL(S))
---------------------------- -------------------------------
Print Name of Individual Signature of Individual
----------------------------- -------------------------------
State of Residence Date of Subscription
(TO BE USED FOR PARTNERSHIPS, CORPORATIONS,
TRUSTS OR OTHER ENTITIES)
_______________________________ By:______________________________
Print Name of Partnership Signature of Authorized
Corporation - Trust - Entity Representative
------------------------------- ---------------------------------
Capacity of Authorized Print Name of Authorized
Representative Representative
------------------------------- --------------------------------
Print Jurisdiction of Date of Subscription
Incorporation or Organization
