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Worldwide Classifieds Inc

AN INVESTMENT OPPORTUNITY

As submitted to the Securities and Exchange Commission on Soon 9, 2020

 

Registration No. (PENDING)

  

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 1-A

 

REGULATION A OFFERING CIRCULAR

UNDER THE SECURITIES ACT OF 1933

 

WORLDWIDE CLASSIFIEDS INC.

(Exact name of the issuer as specified in its charter)

 

Arizona

(State or other jurisdiction of incorporation or organization)

 

331 East Centerview Drive

Carson California 90746

(213) 926-5083

(Address, including zip code, and telephone number,

including area code, of issuer’s principal executive office)

 

David Jackson

6002 W PIERCE ST

PHOENIX, AZ 85043-2520

(213) 926-5083

(Name, address, including zip code, and telephone number,

including area code, of agent for service)

 

 

Copy to:

 

331 East Centerview Drive

Carson California 90746

(213) 926-5083

 

 

7311    

 

47-5635067

(Primary Standard Industrial

 

(IRS Employer

Classification Code Number) 

 

Identification Number)

//

//

OFFERING CIRCULAR JANUARY ___, 2021

 

WWC 

 

Worldwide Classifieds Inc.

 

Maximum Offering Amount: $50,000,000

 

This is our initial public offering (the “Offering”) of securities of WORLDWIDE CLASSIFIEDS INC., an Arizona corporation (the “Company”). We are offering a maximum of Six Million Two Hundred Fifty Thousand (6,250,000) shares (the “Maximum Offering”) of our common stock, par value $0.000001 (the “Common Stock”) at an offering price of Eight Dollars ($8.00) per share (the “Shares”) on a “best efforts” basis. This Offering will terminate on the earlier of (i) May 30, 2018, subject to extension for up to one-hundred-eighty (180) days in the sole discretion of the Company; or (ii) the date on which the Maximum Offering is sold (in either case, the “Termination Date”). There is no escrow established for this Offering. We will hold closings upon the receipt of investors’ subscriptions and acceptance of such subscriptions by the Company. If on the initial closing date, we have sold less than the Maximum Offering, then we may hold one or more additional closings for additional sales, until the earlier of: (i) the sale of the Maximum Offering or (ii) the Termination Date. There is no aggregate minimum requirement for the Offering to become effective, therefore, we reserve the right, subject to applicable securities laws, to begin applying “dollar one” of the proceeds from the Offering towards our business strategy, development expenses, offering expenses and other uses as more specifically set forth in this offering circular (“Offering Circular”). We expect to commence the sale of the Shares as of the date on which the offering statement of which this Offering Circular is a part (the Offering Statement) is qualified by the United States Securities and Exchange Commission (the “SEC”).

 

Investing in our Common Stock involves a high degree of risk. See “Risk Factors” for a discussion of certain risks that you should consider in connection with an investment in our Common Stock.

 

THE U.S. SECURITIES AND EXCHANGE COMMISSION DOES NOT PASS UPON THE MERITS OF OR GIVE ITS APPROVAL TO ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THESE SECURITIES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE COMMISSION; HOWEVER, THE COMMISSION HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SECURITIES OFFERED ARE EXEMPT FROM REGISTRATION.

 

 

 

 

Price to Public

 

 

Commissions1

 

 

Proceeds to the Company2

 

 

 

 

 

 

 

 

 

 

 

Per Share

 

$

8.00

 

 

$

0.80

 

 

$

7.20

 

Maximum Offering

 

$

50,000,000.00

 

 

$

5,000,000.00

 

 

$

45,000,000.00

 

 

 

GENERALLY, NO SALE MAY BE MADE TO YOU IN THIS OFFERING IF THE AGGREGATE PURCHASE PRICE YOU PAY IS MORE THAN TEN PERCENT (10%) OF THE GREATER OF YOUR ANNUAL INCOME OR YOUR NET WORTH. DIFFERENT RULES APPLY TO ACCREDITED INVESTORS AND NON-NATURAL PERSONS. BEFORE MAKING ANY REPRESENTATION THAT YOUR INVESTMENT DOES NOT EXCEED APPLICABLE THRESHOLDS, WE ENCOURAGE YOU TO REVIEW RULE 251(D) (2) (I) (C) OF REGULATION A. FOR GENERAL INFORMATION ON INVESTING, WE ENCOURAGE YOU TO REFER TO WWW.INVESTOR.GOV.

 

1 Includes up to a maximum of ten percent (10%) of the gross proceeds of this Offering for sales commissions, provided that at this time the Company has not determined if it will require these services or such selected service providers. The Company reserves the right to engage one or more FINRA-member broker-dealers or placement agents in its discretion.

 

2 Does not include expenses of the Offering, including but not limited to, fees and expenses for marketing and advertising of the Offering, media expenses, fees for administrative, accounting, audit and legal services, FINRA filing fees, fees for EDGAR document conversion and filing, and website posting fees, estimated to be as much as $3,000,000.

 

THE SECURITIES UNDERLYING THIS OFFERING STATEMENT MAY NOT BE SOLD UNTIL QUALIFIED BY THE SECURITIES AND EXCHANGE COMMISSION. THIS OFFERING CIRCULAR IS NOT AN OFFER TO SELL, NOR SOLICITING AN OFFER TO BUY, ANY SHARES OF OUR COMMON STOCK IN ANY STATE OR OTHER JURISDICTION IN WHICH SUCH SALE IS PROHIBITED.

 

INVESTMENT IN SMALL BUSINESS INVOLVES A HIGH DEGREE OF RISK, AND INVESTORS SHOULD NOT INVEST ANY FUNDS IN THIS OFFERING UNLESS THEY CAN AFFORD TO LOSE THEIR ENTIRE INVESTMENT. SEE “RISK FACTORS” FOR A DISCUSSION OF CERTAIN RISKS YOU SHOULD CONSIDER BEFORE PURCHASING ANY SHARES IN THIS OFFERING.

 

AN OFFERING STATEMENT PURSUANT TO REGULATION A RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION, WHICH WE REFER TO AS THE COMMISSION. INFORMATION CONTAINED IN THIS PRELIMINARY OFFERING CIRCULAR IS SUBJECT TO COMPLETION OR AMENDMENT. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED BEFORE THE OFFERING STATEMENT FILED WITH THE COMMISSION IS QUALIFIED. THIS PRELIMINARY OFFERING CIRCULAR SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR MAY THERE BE ANY SALES OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL BEFORE REGISTRATION OR QUALIFICATION UNDER THE LAWS OF ANY SUCH STATE. WE MAY ELECT TO SATISFY OUR OBLIGATION TO DELIVER A FINAL OFFERING CIRCULAR BY SENDING YOU A NOTICE WITHIN TWO (2) BUSINESS DAYS AFTER THE COMPLETION OF OUR SALE TO YOU THAT CONTAINS THE URL WHERE THE FINAL OFFERING CIRCULAR OR THE OFFERING STATEMENT IN WHICH SUCH FINAL OFFERING CIRCULAR WAS FILED MAY BE OBTAINED.

//

 

We are offering to sell, and seeking offers to buy, our securities only in jurisdictions where such offers and sales are permitted. You should rely only on the information contained in this Offering Circular. We have not authorized anyone to provide you with any information other than the information contained in this Offering Circular. The information contained in this Offering Circular is accurate only as of its date, regardless of the time of its delivery or of any sale or delivery of our securities. Neither the delivery of this Offering Circular or any sale or delivery of our securities shall, under any circumstances, imply that there has been no change in our affairs since the date of this Offering Circular. This Offering Circular will be updated and made available for delivery to the extent required by the federal securities laws.

 

Unless otherwise indicated, data contained in this Offering Circular concerning the business of the Company are based on information from various public sources. Although we believe that these data are generally reliable, such information is inherently imprecise, and our estimates and expectations based on these data involve a number of assumptions and limitations. As a result, you are cautioned not to give undue weight to such data, estimates or expectations.

     

In this Offering Circular, unless the context indicates otherwise, references to “WWC,” “we,” the “Company,” “our,” and “us” refer to the activities of and the assets and liabilities of the business and operations of WORLDWIDE CLASSIFIEDS INC.

 //

// 

The date of this Offering Circular is _________, 2021.

1CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

Some of the statements under “Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” "Our Business" and elsewhere in this Offering Circular constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar matters that are not historical facts. In some cases, you can identify forward-looking statements by terms such as “anticipate”, “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “should,” “will” and “would” or the negatives of these terms or other comparable terminology.

 

You should not place undue reliance on forward-looking statements. The cautionary statements set forth in this Offering Circular, including in “Risk Factors” and elsewhere, identify important factors which you should consider in evaluating our forward-looking statements. These factors include, among other things:

 

  • ·         Our ability to effectively execute our business plan;
  • ·         Our ability to manage our research, development, expansion, growth and operating expenses;
  • ·         Our ability to evaluate and measure our business, prospects and performance metrics;
  • ·         Our ability to compete and succeed in a highly competitive and evolving industry;
  • ·         Our ability to form strategic partnerships;  
  • ·         Our ability to respond and adapt to changes in technology and customer behavior; and
  • ·         Our ability to protect our intellectual property and to develop, maintain and enhance our brand

 

Our Business

Our business strategy is focused on the development of an online advertising and marketing apparatus that is dynamic, versatile, and smart. WWC, when fully developed, is expected to offer a user experience that will surpass most other e-commerce platforms, with unique benefits and conveniences not available from any of its rivals.

 

We are especially focused on providing network systems and services to start-ups, small, and medium-sized business, and the apparatus for those businesses to succeed.

 

In order to accomplish our objectives, our keys to success over the next three years are:

 

  • Build a product and stand by it;
  • Differentiate from the others by focusing on the needs of the consumer and not only on the bottom line; ((The consumers praise and satisfaction is the bottom line)).
  • Advertise our products and services through all forms of media;
  • Focus on keeping Worldwide Classifieds nourished with innovative products and remain in step with all e-commerce trends;
  • Encourage our merchant users to build their own brands; and
  • Impeccable customer service on all fronts, and
  • Remain outside the box. 

 

Technology

As of the date of this Offering Circular, we have employed software engineers and developers to write code for our websites and create the technology that will integrate them. At present, we are in the process of developing programming that will allow our systems to function seamlessly as one, as well as a cross-platform core that will allow our technology to be used on multiple devices. 

Please note that Worldwide Classifieds is multifaceted and is a three-part project being built simultaneously:

  1.      The core which is Worldwide Classifieds, is an Advertising platform and Market Place,
  2.       New Light Media, which is a platform that will enable our users to socialize and store their video and other types of media for publishing across Worldwide Classifies platforms,
  3.       B2B Empowerment, which is a portal for merchant members to link to wholesalers and access other merchant tools.

 Our entire development efforts and operations with respect to our core technology are based on the commercial agreements with the developers for all of the Company’s technology capabilities.     

We will own the work product of our developers that is being custom built for the Company (the “Company Work Product”).

 

Under the terms of the Agreement, we are obligated to pay a total of approximately $250,000.00, of which we have paid approximately $65,000.00, to date. In addition, once the project is completed, we will pay a monthly fee for software maintenance, hosting, upgrades, training, and support.

 

Geo and Meta Search and other Technologies

 Set forth below is a list of the expected benefits that we expect our technology will provide to end users once the WWC is fully developed: 

                        

  • ·                 Virtual service platforms that are safe and secure
  • ·         Tools that will inspire merchants to be innovative and creative
  • ·         A transparent interface that will allow users access to all available features
  • ·         Geo search and meta-technology that will allow users to filter their search results based on location
  • ·         Merchants will have the ability to create and design their own Microsites within Worldwide Classifieds
  • ·         Diverse payment options including credit cards, debit cards, PayPal®, and Bitcoins
  • ·         User loyalty rewards program
  • ·         Features that will allow users to report misuse and/or abuse immediately
  • ·         Comprehensive E-Commerce Training programs (CECT)

 

By providing Geo-search technology members will be able to pinpoint other WWC members relevant to their location. 

Once a user registers as a member they will have access to all Worldwide Classifieds ‘current websites and products and all future websites and products. Users only have to sign up one time to instantly gain the benefits from a list of services.

 

We are developing and creating our own proprietary Application Programming Interface (API). We anticipate that our proprietary API will in itself create a customizable and more secure e-commerce environment. 

Because of the noticeable outgrowth in e-commerce, more and more consumers are finding their way to Internet shopping. Below is a list of twenty (20) China-based shopping sites. 
 
Rank Website Free shipping Rating Link
1 Free Shipping Visit
2 Free Shipping Visit
3 Free Shipping Visit
4 Free Shipping Visit
5 Free/Paid Shipping Visit
6 Free Shipping Visit
7 Free Shipping Visit
8 Free Shipping Visit
9 Free Shipping Visit
10 Free Shipping Visit
11 Free Shipping Visit
12 Paid Shipping Visit
13 * Free Shipping* * Visit*
14 Free Shipping Visit
15 Free Shipping Visit
16 Free Shipping Visit
17 Free Shipping Visit
18 Free Shipping Visit
19 Free Shipping Visit
20 Free/Paid Shipping Visit
 
The issue here is that most of these sites offer the exact same products or similar products, with no other services and very little room if any for merchants that are based in the Americas. Our primary focus at Worldwide Classifieds Inc. will be in the Americas. Without leaving the realm of Worldwide Classifieds the consumer will be able to shop from one end of the spectrum to the other, participate in online auctions, book travel reservation, read reviews on various topics, post Classifieds Ads, find local registered vendors and purchase tickets to events on a global level, and much more. Worldwide Classifieds’ Merchant members will have access to a consortium style purchasing system, as well as a variety of other tools that can contribute to their success at Worldwide Classifieds.As for the global market forecast, in 2016, total retail sales across the globe were predicted to reach $22.049 trillion, up 6.0% from the previous year. It estimates sales will top $27 trillion in 2020, even as annual growth rates slow over the next few years. This includes sales across all retail channels in its estimates for total retail sales. This includes sales from e-commerce retailers and transactions that occur over consumer-to-consumer (C2C) platforms such as eBay and other auction sites; and sales by motor vehicle and parts dealers. Travel, event ticket and restaurant sales are excluded from this forecast. Retail e-commerce sales—which include products and services (barring travel, restaurant, and event ticket sales) ordered via the internet over any device—were predicted to reach $1.915 trillion in 2016, accounting for 8.7% of total retail spending worldwide.
 

Expanding middle classes, greater mobile and internet penetration, growing competition of e-commerce players and improving logistics and infrastructure will all fuel e-commerce growth.

Experts expect retail e-commerce sales will increase to $4.058 trillion in 2020, even as annual growth slows. This includes sales from e-commerce retailers and transactions that occur over consumer-to-consumer (C2C) platforms such as eBay and other auction sites. Travel, event ticket and restaurant sales are excluded from this forecast. 

Retail e-commerce sales in North America will rise 15.6% this year to reach $423.34 billion, maintaining the area’s status as the world’s second-largest regional e-commerce market. The region will see consistent double-digit growth through 2020, fueled by increased spending from existing digital buyers, expansion into new categories such as grocery, and growing e-commerce sales.

 
China at the present time still remains the world’s largest retail e-commerce market, with sales topping $899.09 billion in 2016, representing almost half (47.0%) of digital retail sales worldwide.

 

With China having one of the most developed e-commerce markets in the world, experts expect purchases made digitally will represent a globe-topping 18.4% of the country’s total retail sales. China will continue to see massive gains in retail e-commerce over the next few years, with sales topping $2.416 trillion in 2020.

There is no doubt that at present China does have a foothold.

 

 

 

 

LATIN AMERICA E-COMMERCE

Despite the economic downturn, Latin America is the market we at Worldwide Classifieds Inc. are paying close attention to. It's one of the top regions in the world for e-commerce growth, and we understand and realize that those that build out their e-commerce operations now will be in the best position to grab market share when the economy rebounds.

In a new report from BI Intelligence, we size Latin America's biggest e-commerce markets — Brazil, Mexico, and Argentina — and project how online retail sales will rise in these countries. We look at the growth drivers in each market and identified the opportunities and challenges for business model there.

 
 
 
 
 
 Here are some of the key takeaways:
  • Latin America is one of the fastest-growing regions for e-commerce, behind Asia-Pacific. We expect online retail sales to grow at a compound annual growth rate (CAGR) of 17% between 2014 and 2019 to reach $85 billion in sales at the end of the forecast period.
  • Brazil is the largest online retail market in Latin America, accounting for 42% of the region's $47.4 billion in e-commerce sales. But e-commerce growth is decelerating due to an economic downturn. Between 2014 and 2019, we expect e-commerce sales to rise at a CAGR of 12.5%.
  • Mexico is the second-largest market for e-commerce in Latin America. Mexico currently accounts for 12.3% of the region's e-commerce, but we expect Mexico's share to increase to 15.6% by 2019. By 2018, Mexico is forecast to reach $11 billion in e-commerce sales — or just under 2.5% of total retail sales in the country.
  • Argentina ranks third in terms of online retail sales in Latin America, but it will be the fastest-growing e-commerce market of the three countries. The country currently accounts for 8.9% of sales in the region, but by 2019, we expect its market share to increase to 14.6%.
  • US retailers are investing heavily in building out their e-commerce businesses in the region, despite the slowing economy. Walmart recently redesigned its country-specific site in Brazil and is finalizing construction of three new e-commerce fulfillment centers in the country — doubling its current fulfillment network. Amazon has been investing heavily in Mexico, launching a Spanish-speaking version of its shopping site under the Mexican domain Amazon.com.mx.

Risks Related to Our Business

 

Our business and our ability to execute our business strategy are subject to a number of risks as more fully described in the section titled “Risk Factors.” These risks include, among others:

 

 

We have no operating history at this level, and our executive offices have a lack of experience in managing companies similar to the Company. We were recently organized and have no history of operations. We, therefore, should be considered a Development Stage Company,” and our operations will be subject to all the risks inherent in the establishment of a new business enterprise, including, but not limited to, hurdles or barriers to the implementation of our business plans. Further, because there is no history of operations there is also no operating history from which to evaluate our executive management’s ability to manage our business and operations and achieve our goals or the likely performance of the Company.

 

 

Our current management team has not previously developed or managed similar companies. The e-commerce industry is characterized by rapid technological change, changes in user requirements and preferences, frequent new product and services introductions embodying new technologies and the emergence of new industry standards and practices that may render our potential products and services set forth under our business plan obsolete. Our current management team’s lack of prior managerial experience within a highly competitive industry, such as the e-commerce or communications industry, subjects our Company to certain qualitative risks and uncertainties.

 

 

We do not have any products or services for commercial sale and may fail to generate any revenues from product or service sales in the foreseeable future, if ever.

 

 

We anticipate, pursuant to our business plan, that we will generate substantially all of our revenue from the end users’ that use of our services and related services.

 

 

In pursuing our business plan, we may commercially fail to develop, continue, enhance or improve the development, performance, functionality, and reliability of our anticipated metasearch and Geo-search development services, as set forth in the Company’s business plan.

 

 

No active market for our common stock exists or may develop, and you may not be able to resell your common stock at or above the initial public offering price.

// 

REGULATION A+

 

We are offering our Common Stock pursuant to recently adopted rules by the Securities and Exchange Commission mandated under the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. These offering rules are often referred to as “Regulation A+.” We are relying upon “Tier 2” of Regulation A+, which allows us to offer of up to $50 million in a 12-month period.

 

In accordance with the requirements of Tier 2 of Regulation A+, we will be required to publicly file annual, semiannual, and current event reports with the Securities and Exchange Commission after the qualification of the offering statement of which this Offering Circular forms a part.

 //

THE OFFERING

 

 

Issuer:           

WORLDWIDE CLASSIFIEDS INC.               

                         

Shares Offered:

A maximum of Six Million Two Hundred Fifty Thousand (6,250,000) shares of our Common Stock (the “Maximum Offering”), at an offering price of Eight Dollars ($8.00) per share (the “Shares”).

                         

The number of shares of Common Stock Outstanding before the Offering:

Twenty-Five Million (25,000,000) Common Stock shares.

                         

The number of shares of Common Stock to be Outstanding after the Offering:

Thirty-One Million Two Hundred Fifty Thousand (31,250,000) shares if the Maximum Offering is sold.

                         

Price per Share:

Eight Dollars ($8.00).

                         

Maximum Offering:

Six Million Two Hundred Fifty Thousand (6,250,000) shares of our Common Stock (the “Maximum Offering”), at an offering price of Eight Dollars ($8.00) per share (the “Shares”), Fifty Million Dollars ($50,000,000).

                         

Use of Proceeds:

If we sell all of the Shares being offered, our net proceeds (after our estimated Offering expenses) will be $45,000,000. We will use these net proceeds for general corporate purposes, and such other purposes described in the “Use of Proceeds “section of this Offering Circular.

                         

Risk Factors:            

 

Investing in our Common Stock involves a high degree of risk. See “Risk Factors.”

New venture.

 

We were recently formed and therefore have no financial or operating history. We do not have any operating revenue and require the net proceeds of this Offering to complete the development of Worldwide Classifieds and commence operations. The likelihood of our success must be considered in light of the problems, delays, risks, expenses, and difficulties frequently encountered in connection with the establishment of any new enterprise, many of which may be beyond our control. We are subject to all of the risks inherent in the creation of a new enterprise and the competitive environment in which we will operate. We cannot provide any assurances that we will be successful in addressing these risks or achieving our objectives.  

 

Absence of immediate revenues.

 

We anticipate that we will incur substantial costs in establishing our business. We currently expect that as a result of the incurrence and payment of our initial expenses and Offering related expenses, we will have significant operating losses in year one since the costs of this Offering must be borne by us until such time if at all, we are able to generate adequate revenues from operations.

 

No minimum capitalization.

 

We do not have a minimum capitalization and we may use the proceeds from this Offering immediately following our acceptance of the corresponding subscription agreements. It is possible we may only raise a minimum amount of capital, which could leave us with insufficient capital to implement our business plan, potentially resulting in greater operating losses unless we are able to raise the required capital from alternative sources. There is no assurance that alternative capital, if needed, would be available on terms acceptable to us, or at all.

 

Minimal employees or infrastructure.

 

We will have a small number of employees and we don’t have any operational infrastructure or prior operating history. We intend to rely on our management team, our advisors, third-party consultants, outside attorneys, accountants, auditors, and other administrators. The loss of services of any of such personnel may have a material adverse effect on our business and operations and there can be no assurance that if any or all of such personnel were to become unavailable, that qualified successors can be found, on acceptable terms.

 

Limitation on remedies; indemnification.

 

Our Articles of Incorporation, as amended from time to time, provides that officers, directors, employees and other agents and their affiliates shall only be liable to the Company and its shareholders for losses, judgments, liabilities, and expenses that result from the fraud or another breach of fiduciary obligations. Additionally, we intend to enter into corporate indemnification agreements with each of our officers and directors consistent with industry practice. Thus, certain alleged errors or omissions might not be actionable by the Company. Our governing instruments also provide that, under the broadest circumstances allowed under law, we must indemnify its officers, directors, employees and other agents and their affiliates for losses, judgments, liabilities, expenses, and amounts paid in settlement of any claims sustained by them in connection with the Company, including liabilities under applicable securities laws.

 

No dividends or return of profits.

 

We haven’t begun operations beyond planning company activities and the commencement of the development of the proprietary programming that will be integrated into our concept sites, however, no such proprietary programming is expected to be made commercially available for an extended period of time after the minimum investment proceeds have been achieved, thus we have not had any profits from any operations to date. We have never declared or paid any cash dividends on our Common Stock. We currently intend to retain future earnings, if any, to finance the expansion of our operations. As a result, we do not anticipate paying any cash dividends in the foreseeable future.

 

Force Majeure.

 

The delay or failure to complete the development and testing of the proprietary programming and the commercial release of our proprietary elements and related services and other custom development services may be due to any act of God, fire, war, terrorism, flood, strike, labor dispute, disaster, or laboratory difficulties or any similar or dissimilar event beyond our control. We will not be held liable to any shareholder in the event of any such failure. 

 

We may incur substantial operating and net losses due to substantial expenditures.

 

Since June 2017, we have invested significant time and resources toward developing concept sites and prototypes in order to project our vision, hone in on the programming and technologies to ensure that Worldwide Classifieds functions as planned and to demonstrate what Worldwide Classifieds may be capable of. We intend to increase our development expenses and capital expenditures in order to expand our market presence. We may incur substantial operating and net losses in the foreseeable future. There can be no assurance that we will achieve or sustain profitability or positive cash flow from our operations.

 

We may not be able to carry out our proposed plan of operations.

 

Our proposed plan of operation and prospects will depend largely upon our ability to successfully establish a large social media and global presence in a timely fashion, retain and continue to hire skilled management, technical, marketing and other personnel; and attract and retain significant numbers of quality business partners and end users. We have limited experience in commercialization and there is limited information available concerning the potential performance or market acceptance of a project of this magnitude. There can be no assurance that we will be able to successfully implement our business plan or develop or maintain future business relationships, or that unanticipated expenses, problems or technical difficulties which would result in material delays in implementation will not occur.

 

We may not be able to manage our growth effectively.

 

Our growth is expected to place a significant strain on our managerial, operational and financial resources. As the number of our users, partners and other business partners grows, we must increasingly manage multiple relationships with various customers, strategic partners, and other third parties. There can be no assurance that our systems, procedures or controls will be adequate to support our operations or that our management will be able to achieve the rapid execution necessary to successfully offer our services and implement our business plan. Our future operating results will also depend on our ability to expand sales and marketing commensurate with the growth of our business and demand. If we are unable to manage growth effectively, our business, results of operations and financial condition will be adversely affected.

 

We rely on our management team, which has little experience working together.

 

We depend on a small number of executive officers and other members of management to work effectively as a team, to execute our business strategy and business plan, and to manage employees and consultants. Our success will be dependent on the personal efforts of David Jackson, Sade Jackson, Patricia M. Jackson and other key personnel. Any of our officers or employees can terminate his or her employment relationship at any time, and the loss of the services of such individuals could have a material adverse effect on our business and prospects. Our management team has worked together for only a very short period of time, and may not work well together as a management team.

 

Changes in the U.S., global or regional economic conditions.

 

A decrease in economic activity in the United States or in other regions of the world could adversely affect demand, thus reducing our ability to generate revenue. A decline in economic conditions could reduce our users’ interest in utilizing our services. In addition, the continued bombardment by Chinese e-commerce sites could also adversely affect our revenues.

 

We will face intense competition.

 

The market for e-commerce services is already highly competitive. Our existing and future competitors may include many large companies that have a substantially greater market presence and financial resources. There can be no assurance that we will have the financial resources and support capabilities to compete successfully. Increased competition could result in significant competition, which in turn could result in lower revenues, which could materially adversely affect our potential profitability.

  

Our continuing depends upon financing.

 

If we do not raise sufficient capital and we continue to experience pre-operating losses, there will most likely be substantial doubt as to our ability to continue as a going concern. Because we have generated no revenue, all expenditures during our development stage have been recorded as pre-operating losses. Revenue operations have not commenced because we have not raised the necessary capital to complete our development process and commence the commercialization of our products and related services.

 

Raising additional capital by issuing additional securities may cause dilution to our current and future shareholders.

 

We will need to, or desire to, raise substantial additional capital in the future. Our future capital requirements will depend on many factors, including, among others:

 

 

The immediate Proof of Concept of Worldwide Classifieds and its services;

 

 

The costs of advertising and  marketing;

 

 

The extent to which we acquire or invest in businesses, products, or technologies, and other strategic relationships; and

 

 

The costs of financing unanticipated requirements in responding to competitive pressures.

  

We will require substantial additional funding which may not be available to us on acceptable terms, or at all. If we fail to raise the necessary additional capital, we may be unable to complete the development and commercialization of our products or continue our development programs.

 

We expect to significantly increase our spending to advance the development of our products and services and will require additional capital for the further development and commercialization of our products, as well as to fund our other operating expenses and capital expenditures. We cannot be certain that additional funding will be available on acceptable terms, or at all. If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we may have to significantly delay and/or scale back the development or commercialization of one or more of our products and services. We may also seek collaborators for the products at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available. Any of these events could significantly harm our business, financial condition and prospects. Our future capital requirements will depend on many factors, including:

  

 

The progress of the development of our proprietary products and customized services, under the Worldwide Classifieds  brand or trademark;

 

 

The time and costs involved in obtaining regulatory approvals, if any;

 

 

The costs involved in filing and prosecuting patent applications and enforcing or defending patent claims, if any;

 

 

Our plans to establish sales, marketing and/or manufacturing capabilities;

 

 

The terms and timing of any collaborative, licensing and other arrangements that we may establish;

 

 

Our ability to establish, enforce and maintain selected strategic alliances and activities required for product and service commercialization; and;

 

 

Our revenues, if any, from successful development and commercialization of the products and services.

 

If we raise additional funds by issuing equity or convertible debt securities, we will reduce the percentage of ownership of the then-existing shareholders, and the holders of that newly-issued equity or convertible debt securities may have rights, preferences, or privileges senior to those possessed by our then-existing shareholders. Additionally, future sales of a substantial number of shares of our Common Stock, or other equity-related securities in the public market could depress the market price of our Common Stock and impair our ability to raise capital through the sale of additional equity or equity-linked securities. We cannot predict the effect that future sales of our Common Stock or other equity-related securities would have on the market price of our Common Stock at any given time.

RISK FACTORS

 

An investment in our Common Stock involves a high degree of risk. You should carefully consider the risks described below, together with all of the other information included in this Offering Circular, before making an investment decision. If any of the following risks actually occurs, our business, financial condition or results of operations could suffer. In that case, the trading price of our shares of common stock could decline and you may lose all or part of your investment. See “Cautionary Note Regarding Forward-Looking Statements” above for a discussion of forward-looking statements and the significance of such statements in the context of this Offering Circular.

 

Risks Related to Our Company

 

We have virtually no operating history on which to judge our business prospects and management.

 

The Company was incorporated on November 17, 2015, in the State of Arizona and only commenced operations thereafter. The Company now operates as a “C” corporation formed under the laws of the State of Arizona. Accordingly, we have virtually no operating history upon which to base an evaluation of our business and prospects. Operating results for future periods are subject to numerous uncertainties and we cannot assure you that the Company will achieve or sustain profitability. The Company’s prospects must be considered in light of the risks encountered by companies in the early stage of development, particularly companies in rapidly evolving markets. Future operating results will depend upon many factors, including our success in attracting and retaining motivated and qualified personnel, our ability to establish short-term credit lines or obtain financing from other sources, such as the contemplated Regulation A+ offering, our ability to develop and market new products, control costs, and general economic conditions. We cannot assure you that the Company will successfully address any of these risks.

 

 

We are significantly influenced by our officers, directors, and entities affiliated with them.

In the aggregate, ownership of the Company’s shares of Common Stock by management and affiliated parties, assuming the sale of the Maximum Offering, will represent approximately 73.19% of the issued and outstanding shares of Common Stock. These shareholders, if acting together, will be able to significantly influence all matters requiring approval by shareholders, including the election of directors and the approval of mergers or other business transactions. Please see “Beneficial Ownership” below for more information.

 

Our future performance is dependent on the ability to retain key personnel. The Company’s performance is substantially dependent on the performance of senior management. The loss of the services of any of its executive officers or other key employees could have a material adverse effect on the Company's business, results of operations and financial condition.

 

Certain provisions of our  Bylaws and Arizona law make it more difficult for a third party to acquire us and make a takeover more difficult to complete, even if such a transaction were in the stockholders’ interest.

 

Our Bylaws and certain provisions therein could have the effect of making it more difficult or more expensive for a third party to acquire, or from discouraging a third party from attempting to acquire, control of the Company, even when these attempts may be in the best interests of our stockholders. For example, we are governed by Section 2741 of the Arizona Corporations and Associations Law. In general, Section 2741 prohibits a public Arizona corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder unless the business combination is approved in a prescribed manner. A “business combination” includes mergers, asset sales or other transactions resulting in a financial benefit to the stockholder. An “interested stockholder” is a person who, together with affiliates and associates, owns, or within three years, did own, fifteen percent (15%) or more of the corporation’s outstanding voting stock. These provisions may have the effect of delaying, deferring or preventing a change in our control.

 

 

Limitations of Director Liability and Indemnification of Directors and Officers and Employees.

 

Our Articles of Incorporation limits the liability of directors to the maximum extent permitted by Arizona law. Arizona law provides that directors of a corporation will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability for any:

 

 

breach of their duty of loyalty to us or our stockholders;

 

 

act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

 

 

unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Arizona Corporations and Associations Law; or

 

 

transactions for which the directors derived an improper personal benefit.

 

These limitations of liability do not apply to liabilities arising under the federal or state securities laws and do not affect the availability of equitable remedies such as injunctive relief or rescission. Our bylaws provide that we will indemnify our directors, officers, and employees to the fullest extent permitted by law. Our bylaws also provide that we are obligated to advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding. We believe that these bylaw provisions are necessary to attract and retain qualified persons as directors and officers. The limitation of liability in our Articles of Incorporation and bylaws may discourage stockholders from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might provide a benefit to us and our stockholders. Our results of operations and financial condition may be harmed to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

 

We will need but may be unable to obtain additional funding on satisfactory terms, which could dilute our shareholders or impose burdensome financial restrictions on our business.

 

We have relied upon cash from financing activities and in the future, we hope to rely on revenues generated from operations to fund all of the cash requirements of our activities. However, there can be no assurance that we will be able to generate any significant cash from our operating activities in the future. Future financings may not be available on a timely basis, in sufficient amounts or on terms acceptable to us, if at all. Any debt financing or another financing of securities senior to the Common Stock will likely include financial and other covenants that will restrict our flexibility. Any failure to comply with these covenants would have a material adverse effect on our business, prospects, financial condition and results of operations because we could lose our existing sources of funding and impair our ability to secure new sources of funding. However, there can be no assurance that the Company will be able to generate any investor interest in its securities. If we do not obtain additional financing, our business will never commence, in which case you would likely lose the entirety of your investment in us.

 

We are at an early stage of development as a company and currently have no source of revenue and may never become profitable.

 

We are a development-stage technology-based company that began operating and commenced research and development activities in 2016. As a recently formed development-stage company, we are subject to all of the risks and uncertainties of a new business, including the risk that we may never develop, complete development or market any of our products or services and we may never generate product or services related revenues. Accordingly, we have only a limited history upon which an evaluation of our prospects and future performance can be made. We only have three products currently under development, which equates to one project which will require further development, significant marketing efforts and substantial investment before it and any successors could provide us with any revenue. As a result, if we do not successfully develop, market and commercialize this project, we will be unable to generate any revenue for many years, if at all. If we are unable to generate revenue, we will not become profitable, and we may be unable to continue our operations. Furthermore, our proposed operations are subject to all business risks associated with new enterprises. The likelihood of our success must be considered in light of the problems, expenses, difficulties, complications, and delays frequently encountered in connection with the expansion of a business, operation in a competitive industry, and the continued development of advertising, promotions and a corresponding customer base. There can be no assurances that we will operate profitably.

 

Emerging Growth Company Status.

 

We are an “emerging growth company” as defined in the Jumpstart Our Business Startups Act (“JOBS Act”). For as long as we are considered to be an emerging growth company, we may take advantage of specified exemptions from reporting and other regulatory requirements that are otherwise applicable generally to other public companies. These exemptions include:

 

 

an exemption from providing an auditor’s attestation report on management’s assessment of the effectiveness of the Company’s systems of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002;

 

 

an exemption from compliance with any new requirements adopted by the Public Accounting Oversight Board (“PCAOB”), requiring mandatory audit firm rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer;

 

 

an exemption from compliance with any other new auditing standards adopted by the PCAOB after April 5, 2012, unless the United States Securities and Exchange Commission determines otherwise; and

 

 

reduced disclosure of executive compensation.

 

In addition, Section 107 of the JOBS Act provides that an emerging growth company can use the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. This permits an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, we may choose to “opt out” of such extended transition period and, as a result, we would be required to comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Our decision to opt out of the extended transition period for complying with new or revised accounting standards would be irrevocable. We would cease to be an “emerging growth company” upon the earlier of (i) when we have $1 Billion or more in annual revenues, (ii) when we have at least $700 Million in market value of our Common Stock held by non-affiliates, (iii) when we issue more than $1 Billion of non-convertible debt over a three-year period, or (iv) the last day of the fiscal year following the fifth anniversary of our initial public offering.

 

At this time we do not have any products that are ready for use by end users and therefore do not expect to generate any revenues from our product in the immediate future, if ever.

 

We currently do not have any products that are ready for use by end users. To date, we have funded our operations from sales of our securities. We have not received, and do not expect to receive for the foreseeable future, any revenues from the commercialization of our products. We may never succeed in these activities, and may not generate sufficient revenues to continue our business operations or achieve profitability.

 

We expect the development of our product and development services will require significant additional effort, resources, time and expenses.

 

If we are unable to make our products and services commercially available, we may not be able to fund future operations. Even if we are able to commercialize our potential products or services, there is no assurance that the product(s) would generate revenues or that any revenues generated would be sufficient for us to become profitable or thereafter maintain profitability.

 

If we are unable to successfully develop or innovate for existing or future products and services, our revenue growth rate and profits may be reduced or prospects thereof severely diminished

To successfully develop and grow our proposed business, we must develop a single sign-on geo-friendly meta search advertising platform in a profitable manner. Delays or failures in launch our product in a timely fashion could hurt our ability to meet our growth objectives, which may affect our financial projections and may impact our stock price. We cannot guarantee that the finished product or custom development will be able to achieve our expansion goals or that our finished product will be operated profitably. Our ability to expand successfully will depend on a number of factors, many of which are beyond our control.

 

We have no operating history, and our executive offices have a lack of experience in managing companies similar to the Company

We were recently organized and have no history of operations. We, therefore, should be considered a “Development Stage Company,” and our operations will be subject to all the risks inherent in the establishment of a new business enterprise, including, but not limited to, hurdles or barriers to the implementation of our business plans. Further, because there is no history of operations there is also no operating history from which to evaluate our executive management’s ability to manage our business and operations and achieve our goals or the likely performance of the Company. Prospective investors should also consider the fact that our management team has not previously developed or managed similar companies. No assurances can be given that we will be able to achieve or sustain profitability

 

Inadequacy of capital.

 The expected gross offering proceeds of a maximum of $45,000,000 to $50,000,000 may never be realized. While we believe that such proceeds will capitalize and sustain us to allow for the continued development and implementation of our business plan, if only a fraction of this Offering is sold, or if certain assumptions contained in the business plans prove to be incorrect, we may have inadequate funds to fully develop our business. Although we believe that the proceeds from this Offering will be sufficient to help sustain our development process and business operations, there is no guarantee that we will raise all the funds needed to adequately fund our business plan.

 

Risks of borrowing.

 Although we don’t intend to incur any debt from the equity commitments provided, should we obtain secure bank debt in the future, possible risks could arise. If we incur indebtedness, a portion of our future revenues will have to be dedicated to the payment of principal and interest on such indebtedness. Typical loan agreements also might contain restrictive covenants, which may impair our operating flexibility. Such loan agreements would also provide for default under certain circumstances, such as failure to meet certain financial covenants. A default under a loan agreement could result in the loan becoming immediately due and payable and, if unpaid, a judgment in favor of such lender which would be senior to our rights. A judgment creditor would have the right to foreclose on any of our assets resulting in a material adverse effect on our business, ability to generate revenue, operating results or financial condition.

 

Unanticipated obstacles to the execution of our business plan.

 Our business plan may change significantly. Many of our potential business endeavors are capital intensive and may be subject to statutory or regulatory requirements. The Board of Directors believes that the chosen activities and strategies are achievable in light of current economic and legal conditions with the skills, background, and knowledge of our principals and advisors. The Board of Directors reserve the right to make significant modifications to our stated strategies depending on future events.

 

Controlling Shareholder.

 As of the date of this Offering Circular, our founder, and director, David Jackson, owned approximately 62.49% of our outstanding Common Stock shares. Upon completion of this Offering, assuming all Six Million Two Hundred Fifty Thousand (6,250,000) shares of our Common Stock are sold in this Offering, Mr. Jackson will own approximately 51% of the issued and outstanding Common Stock shares. As a result, Mr. Jackson will be able to control any vote of our shareholders which may be required for the foreseeable future. Potential investors in this Offering will not have the ability to control either a vote of our Common Stock, our Board of Director or otherwise influence or control the decisions of our appointed officers.

 

Risks of operations.

Our future operating results may be volatile, difficult to predict and may fluctuate significantly in the future due to a variety of factors, many of which may be outside of our control. Due to the nature of our target market, we may be unable to accurately forecast our future revenues and operating results. Furthermore, our failure to generate revenues would prevent us from achieving and maintaining profitability. There are no assurances that we can generate significant revenue or achieve profitability. We anticipate having a sizeable amount of fixed expenses, and we expect to incur losses due to the execution of our business strategy, continued development efforts and related expenses. As a result, we will need to generate significant revenues while containing costs and operating expenses if we are to achieve profitability. We cannot be certain that we will ever achieve sufficient revenue levels to achieve profitability.

Risks Related to Our Business and Industry

 

If we do not continue to innovate and provide tools and services that are useful to core users, we may not remain competitive, and our revenues and operating results could suffer.

 

Our success depends on continued innovation to provide features and services that make our websites and mobile applications useful for users. Our competitors are constantly developing innovations in related services and features. As a result, we must continue to invest significant resources in research and development in order to continually improve the speed, accuracy, and comprehensiveness of our services. If we are unable to continue offering innovative products and services, we may be unable to attract additional users or retain our current users, which could adversely affect our business, results of operations and financial condition.

 

Competition could adversely affect us by reducing traffic to our website and mobile applications by creating a competitive product that people choose over Worldwide Classifieds.

 

Amazon, eBay, Etsy, and Ali Express are the main providers and operators that can also be considered as competitors, however, neither offers nor functions as a metasearch provider. We anticipate that we will be the first meta-search provider to market and subsequently sustain a lead competitive advantage. We believe that technological innovation or customer demand will create the risk of incentivizing others competing providers to enter the metasearch provider space in the future.

 

We rely on the performance of highly skilled personnel, including senior management and our technology professionals, and if we are unable to retain or motivate key personnel or hire, retain and motivate qualified personnel, our business would be harmed.

 

We believe our success has depended and continues to depend, on the efforts and talents of our senior management and our team members, including our software engineers. Our future success depends on our ability to attract, develop, motivate and retain highly qualified and skilled employees. The loss of any of our senior management or key employees could materially adversely affect our ability to build on the efforts they have undertaken and to execute our business plan, and we may not be able to find adequate replacements. We cannot ensure that we will be able to retain the services of any members of our senior management or other key employees.

 

Competition for well-qualified employees in all aspects of our business, including software engineers and other technology professionals, is intense both in the U.S. and abroad.

 

Our continued ability to compete effectively depends on our ability to attract new employees and to retain and motivate existing employees. Software engineers and technology professionals are key individuals in designing the code and algorithms necessary to our business. Therefore, our ability to attract top talent and experienced engineers and technology professional are important to our success. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business would be adversely affected.

 

Governmental regulation and associated legal uncertainties could limit our ability to expand our product offerings or enter into new markets and could require us to expend significant resources, including the attention of our management, to review and comply with such regulations.

 

Elements of our product and services rely on are currently or will be regulated by Federal, state, city and/or local governments, and our ability to provide these services is and will continue to be affected by government regulations. The implementation of unfavorable regulations or unfavorable interpretations of existing regulations by courts or regulatory bodies with respect to global trade could require us to incur significant compliance costs, cause the development of the affected markets to become impractical and otherwise have a material adverse effect on our business, results of operations and financial condition. In addition, our business strategy involves expansion into regions around the world, many of which have different legislation, regulatory environments, tax laws and levels of political stability. Compliance with foreign legal, governmental, regulatory or tax requirements will place demands on our time and resources, and we may nonetheless experience unforeseen and potentially adverse legal, regulatory or tax consequences. It is intended that our business will assist with the processing of customer credit card transactions which would result in us receiving and storing personally identifiable information. This information is increasingly subject to legislation and regulations in numerous jurisdictions around the world. This legislation and regulation are generally intended to protect the privacy and security of personal information, including credit card information that is collected, processed and transmitted in or from the governing jurisdiction. We could be adversely affected if government regulations require us to significantly change our business practices with respect to this type of information.

 

We may not be able to adequately protect our intellectual property, which could harm the value of our brands and adversely affect our business.

 

We believe that intellectual property will be critical to our success and that we will rely on trademark, copyright and patent law, trade secret protection and confidentiality and/or license agreements to protect our proprietary rights. If we are not successful in protecting our intellectual property, it could have a material adverse effect on our business, results of operations and financial condition. While we believe that we will be issued trademarks, patents, and pending patent applications help to protect our business, there can be no assurance that our operations do not, or will not, infringe valid, enforceable third-party patents of third parties or that competitors will not devise new methods of competing with us that are not covered by our anticipated patent applications. There can also be no assurance that our patent applications will be approved, that any patents issued will adequately protect our intellectual property, or that such patents will not be challenged by third parties or found to be invalid or unenforceable or that our patents will be effective in preventing third parties from utilizing a copycat business model to offer the same service in one or more categories. Effective trademark, service mark, copyright, and trade secret protection may not be available in every country in which our intended services will be provided. The laws of certain countries do not protect proprietary rights to the same extent as the laws of the U.S. and, therefore, in certain jurisdictions, we may be unable to protect our proprietary technology adequately against unauthorized third-party copying or use, which could adversely affect our competitive position. We expect to license in the future, certain proprietary rights, such as trademarks or copyrighted material, to third parties. These licensees may take actions that might diminish the value of our proprietary rights or harm our reputation, even if we have agreements prohibiting such activity. Also to the extent, third parties are obligated to indemnify us for breaches of our intellectual property rights, these third parties may be unable to meet these obligations. Any of these events could have a material adverse effect on our business, results of operations or financial condition.

 

Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information.

 

We anticipate that a substantial amount of our processes and technologies will be protected by trade secret laws. In order to protect these technologies and processes, we intend to rely in part on confidentiality agreements with our employees, licensees, independent contractors and other advisors. These agreements may not effectively prevent disclosure of confidential information, including trade secrets, and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, others may independently discover our trade secrets and proprietary information, and in such cases, we could not assert any trade secret rights against such parties. To the extent that our employees, contractors or other third parties with which we do business use intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions. Laws regarding trade secret rights in certain markets in which we operate may afford little or no protection to our trade secrets. The loss of trade secret protection could make it easier for third parties to compete with our products by copying functionality. In addition, any changes in, or unexpected interpretations of, the trade secret and other intellectual property laws in any country in which we operate may compromise our ability to enforce our trade secret and intellectual property rights. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our business, revenue, reputation and competitive position.

 

Our ability to succeed depends on our ability to grow our business and achieve profitability.

 

The introduction of new technology and custom development services (including use of  metasearch results) are and will each contribute significantly to our operational results, and we will also work on avenues to develop new and innovative ways to develop and expand our merchant apparatus, user ease of navigation, our mobile App, and the Worldwide Classifieds brand. Our future operational success and profitability will depend on a number of factors, including, but not limited to:

 

 

Our ability to manage costs;

 

 

The increasing level of competition in e-commerce and other online services;

 

 

Our ability to continuously offer new and innovative products and services;

 

 

 

Our ability to maintain efficient, timely and cost-effective production and delivery of our products and services;

 

 

The efficiency and effectiveness of our sales and marketing efforts in building product, services, and our  brand awareness;

 

 

Our ability to identify and respond swiftly and successfully to emerging trends in e-commerce and social networks;

 

 

The level of consumer response to our anticipated metasearch technologies;

 

 

 

Brand recognition, and;

 

 

General economic conditions and consumer confidence.

We may not be successful in executing our development and/or growth strategy, and even if we are successful in the development of our product and related services and achieve targeted growth, we may not be able to achieve or sustain profitability. Failure to successfully execute any material part of our development strategy or growth strategy would significantly impair our future growth and our ability to attract and sustain investments in our business.

 

Our mobile App and related services are based on new and unproven technologies and are subject to the risks of failure inherent in the development of new products and services.

 

Because our mobile App and related services are and will be based on new technologies, they are subject to risks of failure that are particular to new technologies, including the possibility that:

 

 

our new approaches will not result in any products or services that gain market acceptance;

 

 

our mobile Apps and the technology powering our custom development services may unfavorably interact with other types of commonly used applications and services, thus restricting the circumstances in which they may be used;

 

 

proprietary rights of third parties may preclude us from marketing a new product or service; or

 

 

third parties may market superior or more cost-effective products or services.

 

As a result, our activities may not result in a broad enough base of commercially viable products or services, which would harm our sales, revenue and financial condition.

 

If we are unable to maintain good relationships in the markets where our proprietary elements are utilized, our business will suffer.

 

Apple’s “App Store” and Google’s “Google Play” are the primary distribution, marketing, promotion platform for our mobile Apps. It is intended that we will generate a significant portion of our revenue from the end users’ use of our mobile App and related services through these platforms and any deterioration in such a relationship with Apple or Google could harm our business and adversely affect the value of our stock. It is intended that we will be subject to Apple’s and Google’s standard terms and conditions for application developers, which govern the promotion, distribution, and operation of mobile Apps on their platforms. As a result, our business would be harmed if (i) Apple or Google discontinues or limits access to its platform by us and other App developers; (ii) Apple or Google modifies its terms of service or other policies, including fees charged to, or other restrictions on, us or other application developers, or Apple or Google changes how the personal information of its users is made available to application developers on their respective platforms or shared by users; (iii) Apple or Google establishes more favorable relationships with one or more of our competitors or strategic partner; or (iv) Apple or Google develops its own competitive apps or offerings. We intend to benefit from Apple and Google’s strong brand recognition and large user base. If Apple or Google loses its market position or otherwise falls out of favor with mobile users, we would need to identify alternative channels for marketing, promoting and distributing our Apps, which would consume substantial resources and may not be effective. In addition, Apple and Google have broad discretion to change their terms of service and other policies with respect to our future mobile App offering and other developers, and those changes may be unfavorable to us. Any such changes in the future could significantly alter how potential App users experience our prospective mobile Apps or interact within our Apps, which may harm our business.

The mobile application industry is subject to rapid technological change and, to compete, we must continually enhance our mobile Apps and custom development services.

We must continue to enhance and improve the performance, functionality, and reliability of our anticipated meta search mobile App and services. The mobile application industry is characterized by rapid technological change, changes in user requirements and preferences, frequent new product and service introductions embodying new technologies and the emergence of new industry standards and practices that could render our products and services obsolete. Our success will depend, in part, on the development of new mobile apps and services that address the increasingly sophisticated and varied needs of our customers, and respond to technological advances and emerging industry standards and practices on a cost-effective and timely basis. The development of our technology and other proprietary technology involves significant technical and business risks. We may fail to use new technologies effectively or to adapt our proprietary technology and systems to customer requirements or emerging industry standards. If we are unable to adapt to changing market conditions, customer requirements or emerging industry standards, we may not be able to increase our revenue and expand our business.

 

We may face intense competition and expect competition to increase in the future, which could prohibit us from developing a customer base and generating revenue.

 

The e-commerce industry is both highly competitive and rapidly evolving, with low barriers to entry and we expect more companies to enter these sectors with a wider range of related products and services to be introduced. Most companies have significantly greater financial and other resources than us and have been developing their products and services longer than we have been developing ours. Moreover, because we are an aggregator service, we are entirely dependent on the strategic relationships we will need to establish with the various social networking services in the industry. If we are unable to forge these strategic relationships and maintain such relationships, our business will be severely harmed.

 

Major network failures could have an adverse effect on our business.

 

Technology infrastructure is critical to the performance of our apparatus, mobile Apps, and related services, as well as customer satisfaction. Currently, we have not yet developed or implemented such an infrastructure. However, it is anticipated that our future proprietary apps will run on a complex distributed system, or what is commonly known as cloud computing. It is anticipated that we will own, operate and maintain certain elements of this system, but some of this system will be operated by third parties. Major equipment failures, natural disasters, including severe weather, terrorist acts, acts of war, cyber attacks or other breaches of network or information technology security that affect third-party networks, communications switches, routers, mobile apps, microwave links, cell sites or other third-party equipment on which we rely, could cause major network failures and/or unusually high network traffic demands that could have a material adverse effect on our operations or our ability to provide service to our customers. These events could disrupt our operations, require significant resources to resolve, result in a loss of customers or impair our ability to attract new customers, which in turn could have a material adverse effect on our business, prospects, results of operations and financial condition. If we experience significant service interruptions, which could require significant resources to resolve, it could result in a loss of customers or impair our ability to attract new customers, which in turn could have a material adverse effect on our business, prospects, results of operations and financial condition.

 

Defects in our mobile App and its functionality and the technology powering our custom development services may adversely affect our business.

 

It is anticipated that the tools, code, subroutines, and processes contained within our proprietary applications or the technology powering our custom development services may contain defects when introduced and also when updates and new versions are released. The introduction of our mobile App or custom development services with defects or quality problems may result in adverse publicity, uncollectible or delayed accounts receivable, product redevelopment costs, loss of or delay in market acceptance of our products or claims by customers or others against us. Such problems or claims may have a material and adverse effect on our business, prospects, financial condition and results of operations.

 

 

We may become subject to government regulation and legal uncertainties that could reduce demand for our products and services, including our App, or increase the cost of doing business, thereby adversely affecting our ability to generate revenues.

 

We are not currently subject to direct regulation by any domestic or foreign governmental agency, other than regulations applicable to businesses generally and laws or regulations directly applicable to internet commerce. It is difficult to predict how existing laws will be applied to our business and the new laws to which we may become subject. If we are not able to comply with these laws or regulations or if we become liable under these laws or regulations, we could be directly harmed, and we may be forced to implement new measures to reduce our exposure to this liability. This may require us to expend substantial resources or to modify our App or custom development services, which would harm our business, financial condition and results of operations. In addition, the increased attention focused upon liability issues as a result of lawsuits and legislative proposals could harm our reputation or otherwise impact the growth of our business. Any costs incurred as a result of this potential liability could harm our business and operating results. It is possible that a number of laws and regulations may be adopted or construed to apply to us in the United States and elsewhere that could restrict our industry, including user privacy, advertising, taxation, content suitability, copyright, distribution and antitrust. Furthermore, the growth and development of electronic commerce and virtual goods may prompt calls for more stringent consumer protection laws that may impose additional burdens on companies such as ours. We anticipate that scrutiny and regulation of our industry will increase and we will be required to devote legal and other resources to addressing such regulation. Changes to these laws intended to address these issues, including some recently proposed changes, could create uncertainty in the marketplace, which could have a harmful impact on our business model.

 

Failure to comply with federal and state privacy laws and regulations, or the expansion of current or the enactment of new privacy laws or regulations, could adversely affect our business.

 

A variety of federal and state laws and regulations govern the collection, use, retention, sharing and security of consumer data. The existing privacy-related laws and regulations are evolving and subject to potentially differing interpretations. In addition, various federal, state and foreign legislative and regulatory bodies may expand current or enact new laws regarding privacy matters. For example, recently there have been Congressional hearings and increased attention to the capture and use of location-based information relating to users of smartphones and other mobile devices. Several internet companies have incurred penalties for failing to abide by the representations made in their privacy policies and practices. In addition, several states have adopted legislation that requires businesses to implement and maintain reasonable security procedures and practices to protect sensitive personal information and to provide notice to consumers in the event of a security breach. Any failure, or perceived failure, by us to comply with our posted privacy policies or with any data-related consent orders, Federal Trade Commission requirements or orders or other federal, state or international privacy or consumer protection-related laws, regulations or industry self-regulatory principles could result in claims, proceedings or actions against us by governmental entities or others or other liabilities, which could adversely affect our business. In addition, a failure or perceived failure to comply with industry standards or with our own privacy policies and practices could adversely affect our business. Federal and state governmental authorities continue to evaluate the privacy implications inherent in the use of third-party web “cookies” for behavioral advertising. The regulation of these cookies and other current online advertising practices could adversely affect our business.

 

We may be subject to a number of risks related to credit card payments, including data security breaches and fraud that we or third parties experience or additional regulation, any of which could adversely affect our business financial condition and results of operations.

 

We may be subject to a number of risks related to credit card payments, including data security breaches and fraud that we or third parties experience or additional regulation, any of which could adversely affect our business, financial condition and results of operations. We anticipate accepting payment from our users primarily through credit card transactions and certain online payment service providers. The ability to access credit card information on a real-time-basis without having to proactively reach out to the consumer each time we process an auto-renewal payment or a payment for the purchase of a premium feature on any of our dating products is critical to our success. When we or a third party experience a data security breach involving credit card information, affected cardholders will often cancel their credit cards. In the case of a breach experienced by a third party, the more sizable the third party's customer base and the greater the number of credit card accounts impacted, the more likely it is that our users would be impacted by such a breach. To the extent our users are ever affected by such a breach experienced by us or a third party, affected users would need to be contacted to obtain new credit card information and process any pending transactions. It is likely that we would not be able to reach all affected users, and even if we could, some users' new credit card information may not be obtained and some pending transactions may not be processed, which could adversely affect our business, financial condition and results of operations. Even if our users are not directly impacted by a given data security breach, they may lose confidence in the ability of service providers to protect their personal information generally, which could cause them to stop using their credit cards online and choose alternative payment methods that are not as convenient for us or restrict our ability to process payments without significant user effort. Additionally, if we fail to adequately prevent fraudulent credit card transactions, we may face civil liability, diminished public perception of our security measures and significantly higher credit card-related costs, any of which could adversely affect our business, financial condition and results of operations. Finally, the passage or adoption of any legislation or regulation affecting the ability of service providers to periodically charge consumers for recurring membership payments may adversely affect our business, financial condition and results of operations.

 

We depend upon intellectual property and proprietary rights that are vulnerable to unauthorized use.

 

We rely on a combination of copyright and trademark laws, trade secrets, software security measures, license agreements and nondisclosure agreements to protect our proprietary information. Our success will depend, in part, on our ability to operate without infringing the patent or other proprietary rights of others and our ability to preserve our trade secrets and other proprietary property, including our rights in any technology licenses upon which any of our products or services are based. Our inability to preserve such rights properly or operate without infringing on such rights would have a material adverse effect on our business, results of operations and financial condition. We currently do not own any registered copyrights, patents or patent applications pending. It may be possible for unauthorized third parties to copy aspects of, or otherwise obtain and use, our proprietary information without authorization. In addition, there can be no assurance that any confidentiality agreements between us and our employees, or any license agreements with our customers, will provide meaningful protection for our proprietary information in the event of any unauthorized use or disclosure of such proprietary information.

 

We may not be able to keep up with rapid technological changes.

 

To remain competitive, we must continue to enhance and improve the usability, functionality, and features of our applications and related services. The evolving nature of the Internet Advertising industry, telecommunications, apps, and mobile-based services, which is characterized by rapid technological change, changes in user and customer requirements and preferences, frequent new product and service introductions and the emergence of new industry standards and practices, could render our existing systems, app and services obsolete. Our success will depend, in part, on our ability to develop, innovate, license or acquire leading technologies useful in our business, enhance our existing solutions, develop new solutions and technology that address the increasingly sophisticated and varied needs of our current and prospective users, and respond to technological advances and emerging industry and regulatory standards and practices in a cost-effective and timely manner. Future advances in technology may not be beneficial to, or compatible with, our business. Furthermore, we may not successfully use new technologies effectively or adapt our proprietary technology and app to user requirements or emerging industry standards on a timely basis. Our ability to remain technologically competitive may require substantial expenditures and lead time. If we are unable to adapt in a timely manner to changing market conditions or user requirements, our business, financial condition and results of operations could be seriously harmed.

 

Our business is dependent upon consumers using our Proprietary Applications and adopting services and if we fail to obtain broad adoption, our business may be adversely affected.

 

Our success will depend on our ability to complete the development of our Proprietary Applications, ensure our Proprietary Applications are fully functional and reliable as intended, educate consumers regarding the benefits of the Applications, and persuade them to adopt Worldwide Classifieds as their “go-to” dominion for accessing the greatest variety of services. If consumers do not adopt and use our applications and related services, we will not be able to generate revenues and our financial condition will suffer as a result.

 

Our future revenue relies substantially on the proprietary elements of our applications, which is currently our primary product offerings. If our applications or future product offerings fail to gain or lose market acceptance, our business will suffer.

 

Our ability to generate revenue is entirely dependent on the effectiveness and market acceptance of our Applications, products, and services. We expect that revenues derived from our Applications will account for a substantial part of our future revenue. We intend to continue our research and development efforts for the expansion of our business and functionality of our Applications; however, there can be no assurance that we will be able to successfully develop and commercialize our Applications or any other new products or services. If we have difficulty launching our Applications or any other new products in the future, our reputation may be harmed and our financial results adversely affected.

 

International expansion of our business exposes us to market, regulatory, political, operational, financial and economic risks associated with doing business outside of the United States.

 

Our business strategy includes international expansion. Promoting our products internationally and doing business internationally involves a number of risks, including: (i) multiple, conflicting and changing laws and regulations such as tax laws, privacy laws, export and import restrictions, employment laws, regulatory requirements and other governmental approvals, permits and licenses; (ii) obtaining regulatory approvals where required; (iii) requirements to maintain data and the processing of that data on servers located in such countries; (iv) complexities associated with managing multiple payment processing methods and multiple service providers; political and economic instability, including wars, terrorism, political unrest, outbreak of disease, protests, boycotts, curtailment of trade and other market restrictions; and (v) regulatory and compliance risks that relate to maintaining accurate information and control over activities subject to regulation under the United States Foreign Corrupt Practices Act of 1977 (“FCPA”), U.K. Bribery Act of 2010 and comparable laws and regulations in other countries. Any of these factors could significantly harm our future international expansion and operations and, consequently, our ability to generate revenue and results of operations.

 

Security breaches, loss of data and other disruptions could compromise sensitive information related to our business or users, or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.

 

In the ordinary course of our business, we and our third-party billing and collections providers and others partners may collect and store sensitive data, including legally-protected personal information. We may also process and store, and use additional third-parties to process and store, sensitive intellectual property and other proprietary business information, including that of our customers and collaborative partners. While we intend to implement data privacy and security measures that will be compliant with applicable privacy laws and regulations, future security breaches could subject us to liability for violations of various laws, rules or regulations, civil liability, government-imposed fines, orders requiring that we or these third parties change our or their practices which could adversely affect our business. Complying with these various laws could cause us to incur substantial costs or require us to change our business practices, systems, and compliance procedures in a manner adverse to our business.

 

We may become a party to intellectual property litigation or administrative proceedings that could be costly and could interfere with our ability to focus on our business plan.

 

The technology industry has been characterized by extensive litigation regarding patents, trademarks, trade secrets, and other intellectual property rights, and companies in the industry have used intellectual property litigation to gain a competitive advantage. It is possible that U.S. and foreign patents and pending patent applications or trademarks controlled by third parties may be alleged to cover our products or services, or that we may be accused of misappropriating third parties’ trade secrets. Additionally, our products may include hardware and software components that we purchase from vendors, and may include design components that are outside of our direct control. Our competitors, many of which have substantially greater resources and have made substantial investments in patent portfolios, trade secrets, trademarks, and competing technologies, may have applied for or obtained, or may in the future apply for or obtain, patents or trademarks that will prevent, limit or otherwise interfere with our ability to make, use, sell and/or export our products and services or to use product names. We may become a party to patent or trademark infringement or trade secret related disputes or litigation as a result of these and other third-party intellectual property rights being asserted against us. The defense and prosecution of these matters are both costly and time-consuming.

Further, if such patents, trademarks, or trade secrets are successfully asserted against us, this may harm our business and result in injunctions preventing us from selling our products, license fees, damages and the payment of attorney fees and court costs. In addition, if we are found to willfully infringe third-party patents or trademarks or to have misappropriated trade secrets, we could be required to pay treble damages in addition to other penalties. Although patent, trademark, trade secret, and other intellectual property disputes in the technology industry have often been settled through licensing or similar arrangements, costs associated with such arrangements may be substantial and could include ongoing royalties. We may be unable to obtain necessary licenses on satisfactory terms, if at all. If we do not obtain necessary licenses, we may not be able to redesign our primary business model and/or related services in order to avoid infringement.

 

Additionally, in the future, we may need to commence proceedings against others to enforce our patents or trademarks, to protect our trade secrets or know how, or to determine the enforceability, scope, and validity of the proprietary rights of others. These proceedings would result in substantial expense to us and significant diversion of effort by our technical and management personnel. We may not prevail in any lawsuits that we initiate and the damages or other remedies awarded, if any, may not be commercially meaningful. We may not be able to stop a competitor from marketing and selling products that are the same or similar to our products and services or from using product or service names that are the same or similar to ours, and our business may be harmed as a result.

 

Finally, at the outset, we may use certain open-source software in our App. We may face claims from companies that incorporate open source software into their products or from open-source licensors, claiming ownership of, or demanding release of, the source code, the open-source software or derivative works that were developed using such software, or otherwise seeking to enforce the terms of the applicable open source license. These claims could result in litigation and could require us to cease offering our App unless and until we can re-engineer it to avoid infringement. This re-engineering process could require significant additional research and development resources, and we may not be able to complete it successfully. These risks could be difficult to eliminate or manage, and, if not addressed, could harm our business, financial condition, and operating results.

Our use of “open source” software could adversely affect our ability to offer our services and subject us to possible litigation.

 

We may use open source software in connection with our technology development. From time to time, companies that use open source software have faced claims challenging the use of open source software and/or compliance with open source license terms. We could be subject to suits by parties claiming ownership of what we believe to be open source software, or claiming noncompliance with open source licensing terms. Some open source licenses require users who distribute software containing open source to make available all or part of such software, which in some circumstances could include a valuable proprietary code of the user. We intend to monitor the use of open source software and will try to ensure that none is used in a manner that would require us to disclose our proprietary source code or that would otherwise breach the terms of an open source agreement, such use could inadvertently occur, in part because open source license terms are often ambiguous. Any requirement to disclose proprietary source code or pay damages for breach of contract could be harmful to our business, results of operations or financial condition, and could help our competitors develop products and services that are similar to ours.

 

No assurances of protection for proprietary rights; reliance on trade secrets.

 

In certain cases, we may rely on trade secrets to protect intellectual property, proprietary technology and processes, which we have acquired, developed or may develop in the future. There can be no assurances that secrecy obligations will be honored or that others will not independently develop similar or superior products or technology. The protection of intellectual property and/or proprietary technology through claims of trade secret status has been the subject of increasing claims and litigation by various companies both in order to protect proprietary rights as well as for competitive reasons even where proprietary claims are unsubstantiated. The prosecution of proprietary claims or the defense of such claims is costly and uncertain given the uncertainty and rapid development of the principles of law pertaining to this area. We may also be subject to claims by other parties with regard to the use of intellectual property, technical information and data, which may be deemed proprietary to others.

 

Our network operations may be vulnerable to hacking, viruses and other disruptions, which may make our App and related services less attractive and reliable.

 

Internet usage and mobile app usage could decline if any well-publicized compromise of security occurs. Hacking involves efforts to gain unauthorized access to information or systems or to cause intentional malfunctions, loss or corruption of data, software, hardware or other computer equipment. Hackers, if successful, could misappropriate proprietary information or cause disruptions in our service. We may be required to expend capital and other resources to protect our app and related systems upon which our app is reliant against hackers. There can be no assurance that any measures we may take will be effective. Security breaches could have a material adverse effect on our business. In addition, the inadvertent transmission of computer viruses or other digital problems could expose us to a material risk of loss or litigation and possible liability, as well as materially damage our reputation and decrease our user base.

 

Regulatory and legal uncertainties could harm our business.

 

 

We are subject to regulations applicable to businesses generally, and laws or regulations directly applicable to electronic media. However, it is possible that a number of laws and regulations may be adopted with respect to our mobile apps, and internet-based companies relating to user privacy, pricing, content, copyrights, distribution and characteristics and quality of products and services. The adoption of any additional laws or regulations may decrease the expansion of our industry and/or related industries. Moreover, the applicability of existing laws to mobile apps and Internet-based companies is uncertain with regard to many issues, such as securities law, property ownership, insurance, telecommunications, encryption technology, licensing, safety, sales tax, libel and personal privacy. Any such new legislation or regulation could seriously harm our business, financial condition, and future results of operations. The application of laws and regulations from jurisdictions whose laws do not currently apply to our business or the application of existing laws and regulations to mobile apps and Internet-based companies and other online services could also harm our business or that of our strategic partners. Further, we might unintentionally violate laws that may be modified or enacted in the future, which may subject us to civil or criminal penalties that may materially and adversely affect our business.

We currently have no sales and marketing organization. If we are unable to establish a direct sales force in the U.S. to promote our App and related products, the commercial opportunity for our App and related may be diminished.

 

We currently have no sales and marketing organization.   The Company plans to commercialize the Worldwide Classifieds mobile App through Apple’s “App Store” and Google’s “Google Play” as the primary distribution, marketing, and promotion for our mobile Apps. The Company may build a sales and marketing team to oversee the sales and marketing of our core products.  This team will be responsible for the build-out of sales and marketing to support the launch of the primary product and all subsequent products in the pipeline. We will incur significant additional expenses and commit significant additional management resources to establish our sales force. We may not be able to establish these capabilities despite these additional expenditures. In the event we are unable to develop our own sales force or collaborate with a third-party to promote our brand, we may not be able to commercialize our products which would negatively impact our ability to generate revenue. We may not be able to enter into any marketing arrangements on favorable terms or at all. If we are unable to enter into a marketing arrangement for our products, we may not be able to develop an effective sales force to successfully commercialize our products. If we fail to enter into marketing arrangements for our products and are unable to develop an effective sales force, our ability to generate revenue would be limited.

  

Changes in patent law could diminish the value of patents in general, thereby impairing our ability to protect our intellectual property.

 

As is the case with other technology companies, our success will be heavily dependent on intellectual property, particularly patents. Obtaining and enforcing patents in the technology industry involves both technological and legal complexity. Therefore, obtaining and enforcing technology patents is costly, time-consuming and inherently uncertain. In addition, the U.S. has recently enacted and is currently implementing wide-ranging patent reform legislation. The U.S. Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in other situations. In addition to increasing uncertainty with regard to our ability to obtain patents in the future, this combination of events has created uncertainty with respect to the value of patents, once obtained. Depending on decisions by the U.S. Congress, the federal courts, and the U.S. Patent and Trademark Office, the laws and regulations governing patents could change in ways that would weaken our ability to obtain patents and to enforce patents that we might obtain in the future. Similarly, changes in EU patent law and elsewhere could negatively affect the value of our patents registered outside of the U.S.

 

Obtaining and maintaining our patent protection depends on compliance with various procedural, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with any of these requirements.

 

The U.S. Patent and Trademark Office and various foreign governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other provisions during the patent process. There are situations in which noncompliance can result in abandonment or lapse of a patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, competitors might be able to enter the market earlier than would otherwise have been the case, which could have a material adverse effect on our business, results of operations and financial condition.

 

We may not be able to protect our intellectual property rights throughout the world.

 

 Filing, prosecuting and defending patents related to our Apps and apparatus and any future product candidates throughout the world is prohibitively expensive. Competitors may use our technologies in jurisdictions where we have not obtained patent protection to develop their own product and, further, may export otherwise infringing products to territories where we have patent protection, but where enforcement is not as strong as that in the U.S. These products may compete with our products in jurisdictions where we do not have any issued or licensed patents and our patent claims or other intellectual property rights may not be effective or sufficient to prevent them from so competing. Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property protection, particularly those relating to technology, which could make it difficult for us to stop the infringement of our patents or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business.

Risks Related to this Offering

 

There has been no public market for our Common Stock prior to this Offering, and an active market in which investors can resell their shares may not develop.

 

Prior to this Offering, there has been no public market for our Common Stock. We cannot predict the extent to which an active market for our Common Stock will develop or be sustained after this Offering, or how the development of such a market might affect the market price of our Common Stock. The initial offering price of our Common Stock in this offering is based on a number of factors, including market conditions in effect at the time of the offering, and it may not be in any way indicative of the price at which our shares will trade following the completion of this offering. Investors may not be able to resell their shares at or above the initial offering price.

 

Investors in this Offering will experience immediate and substantial dilution.

 

If all of the Common Stock shares offered hereby are sold, investors in this Offering will own less than 10% of the then outstanding shares of Common Stock but will have paid over 97% of the total consideration for our outstanding shares, resulting in a dilution of ($6.521) per share. See “Dilution” and “Description of Securities” within this Offering Circular.

 

The market price of our Common Stock may fluctuate, and you could lose all or part of your investment.

 

The offering price for our Common Stock is based on a number of factors. The price of our Common Stock may decline following this Offering. The stock market in general, and the market price of our Common Stock will likely be subject to fluctuation, whether due to or irrespective of, our operating results, financial condition, and prospects. Our financial performance, our industry’s overall performance, changing consumer preferences, technologies and advertiser requirements, government regulatory action, tax laws and market conditions, in general, could have a significant impact on the future market price of our Common Stock. Some of the other factors that could negatively affect our share price or result in fluctuations in our share price include:

 

 

actual or anticipated variations in our periodic operating results;

 

 

increases in market interest rates that lead purchasers of our Common Stock to demand a higher yield;

 

 

changes in earnings estimates;

 

 

changes in market valuations of similar companies;

 

 

actions or announcements by our competitors;

 

 

adverse market reaction to any increased indebtedness we may incur in the future;

 

 

additions or departures of key personnel;

 

actions by stockholders;

 

 

speculation in the press or investment community; and

 

 

Our intentions and ability to list our Common Stock on a national securities exchange and our subsequent ability to maintain such listing.

 

We do not expect to declare or pay dividends in the foreseeable future.

We do not expect to declare or pay dividends in the foreseeable future, as we anticipate that we will invest future earnings in the development and growth of our business. Therefore, holders of our Common Stock will not receive any return on their investment unless they sell their securities, and holders may be unable to sell their securities on favorable terms or at all.

 

Sales of our Common Stock under Rule 144 could reduce the price of our stock.

In general, persons holding “restricted securities,” including affiliates, must hold their shares for a period of at least six (6) months, may not sell more than one percent (1%) of the total issued and outstanding shares in any ninety (90) day period, and must resell the shares in an unsolicited brokerage transaction at the market price. However, Rule 144 will only be available for resale in the ninety (90) days after the Company files its semi-annual reports on Form 1-SA and annual reports on Form 1-K, unless the Company voluntarily files interim quarterly reports on Form 1-U, which the Company has not yet decided to do. The availability for sale of substantial amounts of common stock under Rule 144 could reduce prevailing market prices for our securities.

 

Because we do not have an audit or compensation committee, shareholders will have to rely on our directors, none of whom is independent, to perform these functions.

 

We do not have an audit or compensation committee comprised of an independent director. Indeed, we do not have any audit or compensation committee. The Board performs these functions as a whole. No members of the Board are an independent director. Thus, there is a potential conflict in those board members who are also part of management will participate in discussions concerning management compensation and audit issues that may affect management decisions.

 

Our failure to maintain effective internal controls over financial reporting could have an adverse impact on us.

 

We are required to establish and maintain appropriate internal controls over financial reporting. Failure to establish those controls, or any failure of those controls once established, could adversely impact our public disclosures regarding our business, financial condition or results of operations. In addition, management's assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in our internal controls over financial reporting or other matters that may raise concerns for investors. Any actual or perceived weaknesses and conditions that need to be addressed in our internal control over financial reporting, disclosure of management's assessment of our internal controls over financial reporting or disclosure of our public accounting firm's attestation to or report on management's assessment of our internal controls over financial reporting may have an adverse impact on the price of our Common Stock.

 

Management discretion as to the actual use of the proceeds derived from this Offering.

 

The net proceeds from this Offering will be used for the purposes described under “Use of Proceeds.” However, we reserve the right to use the funds obtained from this Offering for other similar purposes not presently contemplated which we deem to be in the best interests of the Company and our shareholders in order to address changed circumstances or opportunities. As a result of the foregoing, our success will be substantially dependent upon the discretion and judgment of the Board of Directors with respect to application and allocation of the net proceeds of this Offering. Investors who purchase our Common Stock will be entrusting their funds to our Board of Directors, upon whose judgment and discretion the investors must depend.

 

The offering price of our Common Stock was arbitrarily determined and does not reflect the value of the company, our assets or our business.

 

The offering price of our Common Stock was arbitrarily determined by our management and is not based on book value, assets, earnings or any other recognizable standard of value. We arbitrarily established the offering price considering such matters as the state of our business development and the general condition of, and opportunities present in, the industry in which we operate. No assurance can be given that our Common Stock Shares, or any portion thereof, could be sold for the offering price or for any amount. If profitable results are not achieved from our operations, of which there can be no assurance, the value of our Common Stock sold pursuant to this Offering will fall below the offering price and become worthless. Prospective investors should not consider the offering price of the Common Stock as indicative of their actual value. The offering price bears little relationship to our assets, net worth, or any other objective criteria.

General securities investment risks.

 

All investments in securities involve the risk of loss of capital. No guarantee or representation is made that an investor will receive a return of its capital. The value of our Common Stock can be adversely affected by a variety of factors, including development problems, regulatory issues, technical issues, commercial challenges, competition, legislation, government intervention, industry developments and trends, and general business and economic conditions.

 

Offering not reviewed by independent professionals.

 

We have not retained any independent professionals to review or comment on this Offering or otherwise protect the interest of the investors hereunder. Although we have retained our own counsel, neither such counsel nor any other counsel has made, on behalf of the investors, any independent examination of any factual matters represented by management herein. Therefore, for purposes of making a decision to purchase our Common Stock, you should not rely on our counsel with respect to any matters herein described. Prospective investors are strongly urged to rely on the advice of their own legal counsel and advisors in making a determination to purchase our Common Stock.

 

We cannot guarantee that we will sell any specific number of Common Stock shares in this Offering.

 

There is no commitment by anyone to purchase all or any part of the Common Stock Shares offered hereby and, consequently, we can give no assurance that all of the Common Stock shares in this Offering will be sold. Additionally, there is no underwriter for this Offering; therefore, you will not have the benefit of an underwriter's due diligence efforts that would typically include the underwriter being involved in the preparation of this Offering Circular and the pricing of our Common Stock shares offered hereunder. Therefore, there can be no assurance that this Offering will be successful or that we will raise enough capital from this Offering to further our development and business activities in a meaningful manner. Finally, prospective investors should be aware that we reserve the right to withdraw, cancel, or modify this Offering at any time without notice, to reject any subscription in whole or in part, or to allot to any prospective purchaser fewer Common Stock Shares than the number for which he or she subscribed.

 

Investors will experience immediate and substantial dilution in the book value of their investment and will experience additional dilution in the future.

 

If you purchase our Common Stock in this Offering, you will experience immediate and substantial dilution because the price you pay will be substantially greater than the net tangible book value per share of the shares you acquire. Since we will require funds in addition to the proceeds of this Offering to conduct our planned business, we will raise such additional funds, to the extent not generated internally from operations, by issuing additional equity and/or debt securities, resulting in further dilution to our existing stockholders (including purchasers of our Common Stock in this Offering).

 

 

We may terminate this Offering at any time during the offering period.

 

We reserve the right to terminate this Offering at any time, regardless of the number of Common Stock shares sold. In the event that we terminate this Offering at any time prior to the sale of all of the Common Stock shares offered hereby, whatever amount of capital that we have raised at that time will have already been utilized by the Company and no funds will be returned to subscribers.

 

We are an early-stage startup company with a very limited operating history of net losses, which we expect to continue, and we may not be able to generate revenues or achieve or sustain profitability in the future.

 

We have incurred net losses since our inception in November 2015. Our losses and accumulated deficit are and will continue to be due to the costs and expenses associated with the organization of our business, the development of our business model, the development of our App and our research and development efforts and infrastructure setup costs. In addition, as a start-up company, we will incur significant legal, accounting and other expenses that will not immediately result in revenue generation. Accordingly, we cannot assure you that we will be able to generate revenues or achieve profitability in the future or that, if we do become profitable, we will sustain profitability. Our failure to generate revenues and ultimately, achieve and sustain profitability in the future could have a material negative impact on our future financial results, cause the value of our Common Stock to become worthless.

 

We may be unable to meet our current and future capital requirements from capital raised by this Offering

 

Our capital requirements depend on numerous factors, including but not limited to the rate and success of our development efforts, marketing efforts, market acceptance of our Applications and related services, our ability to establish and maintain our agreements with our sponsors, our ability to maintain and expand our user base, the rate of expansion of our user community, the level of resources required to develop and commercialize our App, information systems and research and development activities and other factors. The capital requirements relating to the development of our technology and the implementation of our business plan will be significant. We cannot accurately predict the timing and amount of such capital requirements. However, we are dependent on the proceeds of this Offering as well as additional financing that will be required in order to develop our App and fully implement our proposed business plans. However, in the event that our plans change, our assumptions change or prove to be inaccurate, or if the proceeds of this Offering prove to be insufficient to implement our business plan, we would be required to seek additional financing sooner than currently anticipated. There can be no assurance that any such financing will be available to us on commercially reasonable terms, or at all. Furthermore, any additional equity financing may dilute the equity interests of our existing shareholders (including those purchasing shares pursuant to this Offering), and debt financing, if available, may involve restrictive covenants with respect to dividends, raising future capital and other financial and operational matters. If we are unable to obtain additional financing as and when needed, we may be required to reduce the scope of our operations or our anticipated business plans, which could have a material adverse effect on our business, future operating results, and financial condition.

 

No active market for our Common Stock exists or may develop, and you may not be able to resell your Common Stock at or above the initial public offering price.

 

Prior to this Offering, there has been no public market for shares of our Common Stock. We anticipate that we will apply for quoting of our common stock on the OTC Markets or an approved secondary marketplace upon the qualification of the offering statement of which this Offering Circular forms a part. However, there can no assurance that our Common Stock shares will be quoted. If no active trading market for our Common Stock develops or is sustained following this Offering, you may be unable to sell your shares when you wish to sell them or at a price that you consider attractive or satisfactory. The lack of an active market may also adversely affect our ability to raise capital by selling securities in the future or impair our ability to license or acquire other product candidates, businesses or technologies using our shares as consideration.

The market price of our Common Stock may fluctuate significantly, and investors in our Common Stock may lose all or a part of their investment.

 

If a market for our Common Stock develops following this Offering, the trading price of our Common Stock could be subject to wide fluctuations in response to various factors, some of which are beyond our control. The market prices for securities of e-commerce and mobile App companies have historically been highly volatile, and the market has from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. The market price of our common stock may fluctuate significantly in response to numerous factors, some of which are beyond our control, such as:

  •  actual or anticipated adverse results or delays in our research and development efforts;
  • our failure to commercialize our Apps;
  • adverse regulatory decisions;
  • legal disputes or other developments relating to proprietary rights, including patents, litigation matters and our ability to obtain patent protection for our intellectual property, government investigations and the results of any proceedings or lawsuits, including patent or stockholder litigation;
  • changes in laws or regulations applicable to our Apps;
  • our dependence on third parties;
  • announcements of the introduction of new products by our competitors;
  • announcements concerning product development results or intellectual property rights of others;
  • future issuances of our Common Stock or other securities;
  • the addition or departure of key personnel;
  • actual or anticipated variations in quarterly operating results;
  • announcements of significant acquisitions, strategic partnerships, joint ventures or capital commitments by us or our competitors;
  • our failure to meet or exceed the estimates and projections of the investment community;
  • issuances of debt or equity securities;
  • trading volume of our Common Stock;
  • sales of our Common Stock by us or our stockholders in the future;
  • the overall performance of the equity markets and other factors that may be unrelated to our operating performance or the operating performance of our competitors, including changes in market valuations of similar companies;
  • failure to meet or exceed any financial guidance or expectations regarding development milestones that we may provide to the public;
  • ineffectiveness of our internal controls;
  • general political and economic conditions;
  • effects of natural or man-made catastrophic events;
  • other events or factors, many of which are beyond our control; and
  • publication of research reports about us or our industry or positive or negative recommendations or withdrawal of research coverage by securities anal

Further, price and volume fluctuations result in volatility in the price of our common stock, which could cause a decline in the value of our Common Stock. Price volatility of our common stock might worsen if the trading volume of our Common Stock is low. The realization of any of the above risks or any of a broad range of other risks, including those described in these “Risk Factors,” could have a dramatic and material adverse impact on the market price of our Common Stock.

We have not paid cash dividends in the past and do not expect to pay cash dividends in the foreseeable future. Any return on investment may be limited to the value of our Common Stock.

 

We have never paid cash dividends on our Common Stock and do not anticipate paying cash dividends on our Common Stock in the foreseeable future. The payment of dividends on our capital stock will depend on our earnings, financial condition and other business and economic factors affecting us at such time as the board of directors may consider relevant. If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur if the Common Stock price appreciates.

 

Our strategic investments may result in losses.

 

We periodically make strategic investments in various public and private companies with businesses or technologies that may complement our business. The market values of these strategic investments may fluctuate due to market conditions and other conditions over which we have no control. Other-than-temporary declines in the market price and valuations of the securities that we hold in other companies would require us to record losses related to our investment. This could result in future charges to our earnings. It is uncertain whether or not we will realize any long-term benefits associated with these strategic investments.

 

A sale of a substantial number of shares of the Common Stock may cause the price of our Common Stock to decline.

 

If our stockholders sell, or the market perceives that our stockholders intend to sell for various reasons, substantial amounts of our Common Stock in the public market, including shares issued in connection with the exercise of outstanding options or warrants, the market price of our Common Stock could fall. Sales of a substantial number of shares of our Common Stock may make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate. We may become involved in securities class action litigation that could divert management’s attention and harm our business. The stock markets have from time to time experienced significant price and volume fluctuations that have affected the market prices for the Common Stock. These broad market fluctuations may cause the market price of our Common Stock to decline. In the past, securities class action litigation has often been brought against a company following a decline in the market price of a company’s securities. We may become involved in this type of litigation in the future. Litigation often is expensive and diverts management’s attention and resources, which could adversely affect our business.

 

Our quarterly operating results may fluctuate significantly.

 

We expect our operating results to be subject to quarterly fluctuations. Our net loss and other operating results will be affected by numerous factors, including:

 

 

variations in the level of expenses related to our development programs;

 

 

any intellectual property infringement lawsuit in which we may become involved;

 

 

regulatory developments affecting our Apps and related services; and

 

 

our execution of any collaborative, licensing or similar arrangements, and the timing of payments we may make or receive under these arrangements.

 

If our quarterly operating results fall below the expectations of investors or securities analysts, the price of our Common Stock could decline substantially. Furthermore, any quarterly fluctuations in our operating results may, in turn, cause the price of our Common Stock to fluctuate substantially.

 

Directors, executive officers, principal stockholders and affiliated entities own a significant percentage of our capital stock, and they may make decisions that you do not consider to be in your best interests or those of our other stockholders.

 

As of the date of this Offering Circular, our directors, executive officers, and principal stockholders beneficially owned, in the aggregate, substantially all of our outstanding voting securities. As a result, if some or all of them acted together, they would have the ability to exert significant influence over the election of our board of directors and the outcome of issues requiring approval by our stockholders. This concentration of ownership may also have the effect of delaying or preventing a change in control of our company that may be favored by other stockholders. This could prevent transactions in which stockholders might otherwise recover a premium for their shares over current market prices.

 

Our ability to use our net operating loss carry forwards may be subject to limitation.

 

Generally, a change of more than fifty percent (50%) in the ownership of a company’s stock, by value, over a three-year period constitutes an ownership change for U.S. federal income tax purposes. An ownership change may limit our ability to use our net operating loss carryforwards attributable to the period prior to the change. As a result, if we earn net taxable income, our ability to use our pre-change net operating loss carryforwards to offset U.S. federal taxable income may become subject to limitations, which could potentially result in increased future tax liability for us.

 

Our Articles of Incorporation, as amended, Bylaws and applicable Arizona law provide for the indemnification of our directors, officers, employees, and agents, under certain circumstances, against attorney’s fees and other expenses incurred by them in any litigation to which they become a party arising from their association with or activities on our behalf. We will also bear the expenses of such litigation for any of our directors, officers, employees, or agents, upon such person’s promise to repay us, therefore if it is ultimately determined that any such person shall not have been entitled to indemnification. This indemnification policy could result in substantial expenditures by us, which we will be unable to recover. Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended, may be permitted to directors, officers and controlling persons of our Company pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer, or controlling person of our Company in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

 

Our Common Stock may be traded on a closed trading system with limited volume and liquidity.

 

Our Common Stock may not be freely quoted for trading on any stock exchange or through any other traditional trading platform. Our Common Stock may be issued, available for purchase and may be traded exclusively on a specific trading system that is registered with the SEC as an alternative trading system (an “ATS”). We do not currently have any plans to trade our Common Stock on a specific ATS. Any disruption to the operations of an ATS or a broker-dealer's customer interface with an ATS would materially disrupt trading in or potentially result in a complete halt in the trading of, our Common Stock. Because our Common Stock may be traded exclusively on a closed trading system, it is a possibility that there will be a limited number of holders of our Common Stock. In addition, an ATS is likely to experience limited trading volume with a relatively small number of securities trading on the ATS platform as compared to securities trading on traditional securities exchanges or trading platforms. As a result, this novel trading system may have limited liquidity, resulting in a lower or higher price or greater volatility than would be the case with greater liquidity. You may not be able to resell your Common Stocks on a timely basis or at all.

The number of securities traded on an ATS may be very small, making the market price more easily manipulated.

 

While we understand that many ATS platforms have adopted policies and procedures such that security holders are not free to manipulate the trading price of securities contrary to applicable law, and while the risk of market manipulation exists in connection with the trading of any securities, the risk may be greater for our Common Stock because the ATS we choose may be a closed system that does not have the same breadth of market and liquidity as the national market system. There can be no assurance that the efforts by an ATS to prevent such behavior will be sufficient to prevent such market manipulation.

 

An ATS is not a stock exchange and has limited quoting requirements for issuers or for the securities traded.

 

Unlike the more expansive listing requirements, policies and procedures of the Nasdaq Global Market and other trading platforms, there are no minimum price requirements and limited listing requirements for securities to be traded on an ATS. As a result, trades of our Common Stock on an ATS may not be at prices that represent the national best bid or offer prices of securities that could be considered similar securities.

 

Upon the completion of this Offering, we may elect to become a public reporting company under the Securities and Exchange Act of 1934 (the “Exchange Act”), and thereafter publicly report on an ongoing basis as an “emerging growth company” under the reporting rules set forth under the Exchange Act. If we elect not to do so, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 2 issuers. In either case, we will be subject to ongoing public reporting requirements that are less rigorous than Exchange Act rules for companies that are not “emerging growth companies,” and our stockholders could receive less information than they might expect to receive from more mature public companies.

 

Upon the completion of this Offering, we may elect to become a public reporting company under the Exchange Act. If we elect to do so, we will be required to publicly report on an ongoing basis as an “emerging growth company” (as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the “JOBS Act”) under the reporting rules set forth under the Exchange Act. For so long as we remain an “emerging growth company,” we may take advantage of certain exemptions from various reporting requirements that are applicable to other Exchange Act reporting companies that are not “emerging growth companies,” including but not limited to:

 

 

not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

 

 

taking advantage of extensions of time to comply with certain new or revised financial accounting standards;

 

 

being permitted to comply with reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and

 

 

being exempt from the requirement to hold a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

 

We expect to take advantage of these reporting exemptions until we are no longer an emerging growth company. We would remain an “emerging growth company” for up to five (5) years, although if the market value of our Common Stock that is held by non-affiliates exceeds $700 million as of any October 31 before that time, we would cease to be an “emerging growth company” as of the following April 30.

 

If we elect not to become a public reporting company under the Exchange Act, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 2 issuers. The ongoing reporting requirements under Regulation A are more relaxed than for "emerging growth companies" under the Exchange Act. The differences include but are not limited to, being required to file only annual and semi-annual reports, rather than annual and quarterly reports. Annual reports are due within one hundred twenty (120) calendar days after the end of the issuer's fiscal year, and semi-annual reports are due within ninety (90) calendar days after the end of the first six months of the issuer's fiscal year. In either case, we will be subject to ongoing public reporting requirements that are less rigorous than Exchange Act rules for companies that are not “emerging growth companies,” and our stockholders could receive less information than they might expect to receive from more mature public companies.

 

The requirements of being a public company may strain our resources, divert management’s attention and affect our ability to attract and retain qualified board members.

 

As a public company, we will incur significant legal, accounting and other expenses that we have not incurred as a private company, including costs associated with public company reporting requirements. We also will incur costs associated with the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, the Dodd-Frank Act and related rules implemented or to be implemented by the SEC. The expenses incurred by public companies generally for reporting and corporate governance purposes have been increasing. For so long as we qualify as an emerging growth company under the JOBS Act, we may make certain elections that would subject us to reduced reporting and corporate governance requirements. Nonetheless, we expect the rules and regulations associated with being a public company to increase our legal and financial compliance costs and to make some activities more time-consuming and costly, although we are currently unable to estimate these costs with any degree of certainty. These laws and regulations could also make it more difficult or costly for us to obtain certain types of insurance, including director and officer liability insurance, and we may be forced to accept constraints on policy limits and coverage or incur substantially higher costs to obtain coverage. These laws and regulations could also make it more difficult for us to attract and retain qualified persons to serve on our Board, our board committees or as our executive officers and may divert management’s attention. Furthermore, if we are unable to satisfy our obligations as a public company, we could be subject to delisting of our Common Stock, fines, sanctions and other regulatory action and potentially civil litigation.

 

The preparation of our financial statements involves the use of estimates, judgments, and assumptions, and our financial statements may be materially affected if such estimates, judgments or assumptions prove to be inaccurate.

 

Financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) typically require the use of estimates, judgments, and assumptions that affect the reported amounts. Often, different estimates, judgments, and assumptions could reasonably be used that would have a material effect on such financial statements, and changes in these estimates, judgments, and assumptions may occur from period to period over time. These estimates, judgments, and assumptions are inherently uncertain and, if our estimates were to prove to be wrong, we would face the risk that charges to income or other financial statement changes or adjustments would be required. Any such charges or changes could harm our business, including our financial condition and results of operations and the price of our securities. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for a discussion of the accounting estimates, judgments and assumptions that we believe are the most critical to an understanding of our consolidated financial statements and our business.

 

If securities industry analysts do not publish research reports on us or publish unfavorable reports on us, then the market price and market trading volume of our Common Stock could be negatively affected.

 

Any trading market for our Common Stock will be influenced in part by any research reports that securities industry analysts publish about us. We do not currently have and may never obtain research coverage by securities industry analysts. If no securities industry analysts commence coverage of us, the market price and market trading volume of our Common Stock could be negatively affected. In the event, we are covered by analysts, and one or more of such analysts downgrade our securities, or otherwise reports on us unfavorably, or discontinues coverage of us, the market price and market trading volume of our Common Stock could be negatively affected.

 

Our management has broad discretion as to the use of the net proceeds from this offering.

 

 We intend to use a significant portion of the net proceeds from this Offering (if we sell all of the shares being offered) for working capital and other general corporate purposes. However, we cannot specify with certainty the particular uses of such proceeds. Our management will have broad discretion in the application of the net proceeds designated for use as working capital or for other general corporate purposes. Accordingly, you will have to rely upon the judgment of our management with respect to the use of these proceeds. Our management may spend a portion or all of the net proceeds from this Offering in ways that holders of our Common Stock may not desire or that may not yield a significant return or any return at all. The failure by our management to apply these funds effectively could harm our business. Pending their use, we may also invest the net proceeds from this offering in a manner that does not produce income or that loses value. Please see “Use of Proceeds” below for more information.

USE OF PROCEEDS

 

Assuming the sale by us of the Maximum Offering of $50,000,000 and estimated expenses of $5,000,000, the total net proceeds to us would be $45,000,000, which we currently intend to use as set forth below. We expect from time to time to evaluate the acquisition of businesses, products, and technologies for which a portion of the net proceeds may be used, although we currently are not planning or negotiating any such transactions. As of the date of this Offering Circular, we cannot specify with certainty all of the particular uses for the net proceeds to us from the sale of Common Stock. Accordingly, we will retain broad discretion over the use of these proceeds, if any. The following table represents management’s best estimate of the uses of the net proceeds received from the sale of Common Stock assuming the sale of, respectively, 100%, 75%, 50% and 25% of the Common Stock shares offered for sale in this Offering.

 

 

Percentage of Offering Sold

 

(1)

Includes up to $1,500,000 that will be used to pay salaries and related compensation of executive officers and directors of the Company during 2018 pursuant to employment offer letters and contemplated employment agreements with such persons. See “Management – Executive Compensation” elsewhere in this Offering Circular.

 

 

 

 

(2)

Represents the estimated portion of the proceeds from this Offering that would be allocated to our Network Development, if we elect to pursue such initiative. In the event that we do not pursue Network Development, these amounts would be allocated to the Marketing & Customer Acquisition Incentives and SG&A Expenses and Working Capital categories identified above.

 

The amounts set forth above are estimates, and we cannot be certain that actual costs will not vary from these estimates. Our management has significant flexibility and broad discretion in applying the net proceeds received in this Offering. We cannot assure you that our assumptions, expected costs and expenses and estimates will prove to be accurate or that unforeseen events, problems or delays will not occur that would require us to seek additional debt and/or equity funding, which may not be available on favorable terms, or at all. See “Risk Factors.”

 

This expected use of the net proceeds from this Offering represents our intentions based upon our current financial condition, results of operations, business plans and conditions. As of the date of this Offering Circular, we cannot predict with certainty all of the particular uses for the net proceeds to be received upon the closing of this Offering or the amounts that we will actually spend on the uses set forth above. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors. As a result, our management will retain broad discretion over the allocation of the net proceeds from this Offering.

 

We may also use a portion of the net proceeds for the investment in strategic partnerships and possibly the acquisition of complementary businesses, products or technologies, although we have no present commitments or agreements for any specific acquisitions or investments. Pending our use of the net proceeds from this Offering, we intend to invest the net proceeds in a variety of capital preservation investments, including short-term, investment grade, interest-bearing instruments and U.S. government securities.

 //

DILUTION

 

As at the date of this Offering Circular, an aggregate of 25,000,000 shares of Company Common Stock was issued and outstanding.

 

If you purchase shares in this Offering, your ownership interest in our Common Stock will be diluted immediately, to the extent of the difference between the price to the public charged for each share in this offering and the net tangible book value per share of our Common Stock after this offering.

  

If the maximum 6,250,000 shares of Common Stock in this Offering at the initial public offering price of $8.00 per share, after deducting approximately $5,000,000 in sales commissions expenses payable by us, our pro forma as adjusted net tangible book value as of October 31, 2016 would have been approximately $45,157,675, and, or $1.479 per share. This amount represents an immediate increase in pro forma net tangible book value of $1.473 per share to our existing stockholders and an immediate dilution in pro forma net tangible book value of approximately ($6.521) per share to new investors purchasing shares of Common Stock in this Offering.

 

If the maximum 6,250,000 shares of Common Stock is subscribed and sold in this Offering at the initial public offering price of $8.00 per share, after deducting approximately $5,000,000 in sales commissions expenses payable by us, then in the event that following the completion of this Offering an aggregate of 2,000,000 shares of issued and outstanding Series A Preferred Stock are subsequently converted into Common Stock at a conversion price of $6.40 per share3, by reason of our raising a minimum of $5,000,000 shares of Common Stock in this Offering, our pro forma adjusted net tangible book value immediately following the conversion of the Series A Preferred Stock would be approximately $61,157,675, and, or $1.81 per share4. This amount would represents an immediate increase from our adjusted net tangible book value of $1.445 following the completion of this Offering (excluding conversion of the Series A Preferred Stock) to $1.81 per share immediately following the subsequent conversion of 2,000,000 shares of Series A Preferred Stock into an aggregate of 2,500,000 shares of Company Common Stock. The adjusted net tangible book value of $1.81 per share represents an immediate increase in pro forma net tangible book value of $0.367 per share to our existing stockholders (including investors in this Offering), and an immediate dilution in pro forma net tangible book value of approximately ($6.19) per share to new investors purchasing shares of Common Stock in this Offering.

 

For further information on our 2016 Series A Preferred offering or our Series A Preferred Stock please see “Description of Securities” in this Offering Circular.

 

The figure assumes that each full share of Series A Preferred Stock is convertible into Company Common Stock at a conversion price equal Six Dollars and 40/100 cents ($6.40), reflecting the Company’s issuance of an additional 2,500,000 shares of Common Stock, provided however, that such conversion price may be lower than $6.40 per share and constitute such other conversion price per share which shall be equal to eighty (80%) percent of the initial offering price per share of shares of Common Stock of the Company offered to the public in connection with this Offering Circular.

 

4 Price assumes the conversion of 2,000,000 shares of Company Series A Preferred Stock to be converted at a conversion price of Six Dollars and 40/100 cents ($6.40) per share, representing upon 100% conversion of all 2,000,000 shares of Series A Preferred Stock, an aggregate of 2,500,000 shares of Company Common Stock to be validly issued by the Company to the holders of Series A Preferred Stock, immediately prior to conversion thereof.

 

 

MANAGEMENT'S DISCUSSION & ANALYSIS OF

FINANCIAL CONDITION & RESULTS OF OPERATIONS

 

You should read the following discussion and analysis of our financial condition and results of our operations together with our consolidated financial statements and the notes thereto appearing elsewhere in this Offering Circular. This discussion contains forward-looking statements reflecting our current expectations, whose actual outcomes involve risks and uncertainties. Actual results and the timing of events may differ materially from those stated in or implied by these forward-looking statements due to a number of factors, including those discussed in the sections entitled “Risk Factors,” "Cautionary Statement Regarding Forward-Looking Statements" and elsewhere in this Offering Circular. Please see the notes to our Financial Statements for information about our Significant Accounting Policies and Recent Accounting Pronouncements.

 

Summary of Results

 

The following table summarizes the results of our operations for the period from inception on June 21, 2016, to October 31, 2016.

 

WORLDWIDE CLASSIFIEDS INC.

 

 

 

 

Statement of Operations

 

 

 

June 21, 2011 (Inception) to October 31, 2016

 

 

 

 

For the period from June 21, 2011 (inception) to October 31, 2016

 

Revenues. WORLDWIDE CLASSIFIEDS INC., is a pre-revenue development stage company purposed to level the playing field in the e-commerce and digital advertising industry through the development and distribution of our planned geo-search technologies, desktop, and mobile applications. No revenues since the Company’s inception on June 21, 2011, until October 31, 2016.

 

Cost of Goods Sold. The Company remains in the developmental stage and, in conjunction with not having any operational revenue, it has incurred no Cost of Goods and Services Sold.

 

General and Administrative expenses. General and administrative expenses for the period of June 21, 2011, until October 31, 2016, were $183,521.

 

Selling and Marketing Expenses. Selling and marketing expenses for the period of June 21, 2011, until October 31,

 

2016 were $11,741.

 

Product Development. Product development expenses for the period of June 21, 2011, until October 31, 2016, were $46,063.

 

Net Loss. For the foregoing reasons, our net loss was $241,325.00 for the period from June 21, 2011 (inception) to October 31, 2016.

 

Liquidity, Capital Resources, and Plan of Operations

 

Going Concern

 

Our financial statements appearing elsewhere in this Offering Circular have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company's ability to continue as a going concern is a contingent upon its ability to raise additional capital as required. During the period from June 21, 2011 (inception) through October 31, 2016, the Company incurred net losses of $241,325. Initially, we intend to finance our operations through equity and debt financings. 

 

Current Plan of Operations

Our plan of operations is currently focused on the development of our geo-search technologies, desktop, and mobile applications, which are currently in development. We expect to incur substantial expenditures in the foreseeable future for the development and potential commercialization of our merchant training apparatus, our marketing apparatus, and our desktop and our desktop and mobile Apps and the ongoing internal research and development. At this time, we cannot reliably estimate the nature, timing or aggregate amount of such costs. Our geo-search technologies, desktop, and mobile applications will require extensive technical evaluation, significant marketing efforts and substantial investment before they could provide us with any revenue. Further, we intend to continue to build our corporate and operational infrastructure and to build interest in our product and service offerings, with the ultimate goal of attempting to become the first e-commerce platform that uses geo-search-technology in a way that truly benefits local merchants and communities.

 

As noted above, the continuation of our current plan of operations requires us to raise significant additional capital immediately. If we are successful in raising capital through the sale of shares offered for sale in this Offering Circular we believe that the Company will have sufficient cash resources to fund its plan of operations for the next twelve months. If we are unable to do so, our ability to continue as a going concern will be in jeopardy, likely causing us to curtail and possibly cease operations.

 

We continually evaluate our plan of operations discussed above to determine the manner in which we can most effectively utilize our limited cash resources. The timing of completion of any aspect of our plan of operations is highly dependent upon the availability of cash to implement that aspect of the plan and other factors that may be beyond our control. There is no assurance that we will successfully obtain the required capital or revenues, or if obtained, that the amounts will be sufficient to fund our ongoing operations. The inability to secure additional capital would have a material adverse effect on us, including the possibility that we would have to sell our assets or cease operations. If we discontinue our operations, we will not have sufficient funds to pay any amounts to our stockholders.

 

Even if we raise additional capital in the near future, if the current and planned development of our geo-search technologies, desktop, and mobile applications does not demonstrate continuing progress toward taking our product to market, our ability to raise additional capital in the future to fund our product development efforts would likely be seriously impaired. Our ability as an e-commerce company to raise additional capital in the marketplace to fund our continuing development operations is conditioned upon moving the development of products and services toward commercialization. If in the future we are not able to demonstrate adequate progress in the development of our product, we will not be able to raise the capital we need to continue our then current business operations and business activities, and we will likely not have sufficient liquidity or cash resources to continue operating.

 

Because our working capital requirements depend upon numerous factors there can be no assurance that our current cash resources will be sufficient to fund our operations. At present, we have no committed external sources of capital and do not expect any significant product revenues for the foreseeable future. Thus, we will require immediate additional financing to fund future operations. There can be no assurance, however, that we will be able to obtain funds on acceptable terms, if at all.

 

Credit Facilities

 

We do not have any credit facilities or other access to bank credit.

 

Contractual Obligations, Commitments, and Contingencies

On September 28, 2016, Worldwide Classifieds Inc. entered into a Contractual Agreement (the Agreement) with INETX Systems, whereas INETX Systems shall use its own personnel and other assets to provide product development and services to the Company in the form of (a) design and development of the framework that will provide iOS and Android operating system capabilities for our proprietary Applications, (b) design and develop a web registration portal that seamlessly connects new users to all Worldwide Classified’s sites and services, and (c) develop the administrative framework that will enable our customer service personnel to track  and analyze user information.

 

On November 16, 2016, the Company adopted and ratified the terms of said Agreement and accepted the benefits of such arrangement on behalf of the Company.

 

Under the terms of the Agreement, the Company has agreed to pay INETX Systems compensation in the form of a management cost in an amount equal to $10,000 (paid on a monthly basis), plus, following the completion of the Product Management Proposal, the Company has agreed to issue to INETX Systems an option to purchase up to one-percent (1%) of the issued and outstanding Common Stock of the Company at the time of the options exercise.   

 

 

Off-Balance Sheet Arrangements

 

We did not have during the periods presented, and we do not currently have, any off-balance sheet arrangements.

 

Quantitative and Qualitative Disclosures about Market Risk

 

In the ordinary course of our business, we are not exposed to the market risk of the sort that may arise from changes in interest rates or foreign currency exchange rates, or that may otherwise arise from transactions in derivatives.

 

Contingencies

 

Certain conditions may exist as of the date the financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company's management, in consultation with its legal counsel as appropriate, assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company, in consultation with legal counsel, evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company's financial statements. If the assessment indicates a potentially material loss contingency is not probable, but is reasonably possible, or is probable, but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the guarantees would be disclosed.

 

Relaxed Ongoing Reporting Requirements

 

Upon the completion of this Offering, we may elect to become a public reporting company under the Exchange Act. If we elect to do so, we will be required to publicly report on an ongoing basis as an “emerging growth company” (as defined in the Jumpstart Our Business Startups Act of 2012, which we refer to as the “JOBS Act”) under the reporting rules set forth under the Exchange Act. For so long as we remain an “emerging growth company,” we may take advantage of certain exemptions from various reporting requirements that are applicable to other Exchange Act reporting companies that are not “emerging growth companies,” including but not limited to:

 

 

·

not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

 

 

·

taking advantage of extensions of time to comply with certain new or revised financial accounting standards;

  

 

·

being permitted to comply with reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and

 

 

·

being exempt from the requirement to hold a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

 

We expect to take advantage of these reporting exemptions until we are no longer an emerging growth company. We would remain an “emerging growth company” for up to five years, though if the market value of our Common Stock that is held by non-affiliates exceeds $700 million, we would cease to be an “emerging growth company”.

 

 

If we elect not to become a public reporting company under the Exchange Act, we will be required to publicly report on an ongoing basis under the reporting rules set forth in Regulation A for Tier 2 issuers. The ongoing reporting requirements under Regulation A are more relaxed than for “emerging growth companies” under the Exchange Act. The differences include but are not limited to, being required to file only annual and semi-annual reports, rather than annual and quarterly reports. Annual reports are due within one hundred twenty (120) calendar days after the end of the issuer's fiscal year, and semi-annual reports are due within ninety (90) calendar days after the end of the first six (6) months of the issuer's fiscal year.//

Organization Overview

 

WORLDWIDE CLASSIFIEDS INC., an Arizona corporation (the “Company,” “WWC,” “we,” “us” and “our”), is a start-up company that intends to engage in the development and eventual commercialization geo-search applications (the “Service” or the “App”). The Company was originally established as an Arizona corporation June 21, 2016, under the name WORLDWIDE CLASSIFIEDS INC. The Company has elected its fiscal year end to be December 31st.

 

Business Strategy

 

Our primary marketing strategy is focused on the development of our proprietary technology and geo-search technologies (the “Service” or the “App”) that will enable the vendors that are using our apparatus to sell according to their geographical locations within a safer environment. Our proprietary applications, when fully developed, are expected to offer all the convenience a user would expect plus unique benefits and conveniences that are not available from most of the common search applications. Set forth below is a list of some of the expected benefits that our applications will provide to end users once the applications and service platform are fully developed: 

  • Single sign-on across all service platforms
  • An interface allowing users access all available features
  • Better than comparable pricing for vendor guarantee
  • Direct access to the Worldwide Classifieds’ private network
  • Diverse payment options including credit cards, debit cards, Bitcoin, and PayPal®
  • User loyalty rewards program
  • Exclusive coupons and other offers based on users’ routes 
  • Entrepreneur Training Program
  • Access to Vendor Consortium

 

Our Applications are expected to provide an experience for the vendors and consumer alike that is fun, friendly, and entertaining while being robust and not difficult to navigate. Furthermore, we intend to provide information that will help keep our vendors up-to-date on most fashion and marketing trends.

 

We anticipate that within three (3) years Worldwide Classifieds Inc. will be fully capable of standing up to most internet services and/or marketing platforms in existence today, as well as have a positive and progressive impact on small businesses.

 

What makes Worldwide Classifieds different from other existing marketing platforms in the industry is that we are approaching the development of our applications, services, and other apparatus from a user’s perspective by focusing not only on what makes internet shopping enjoyable but also providing the tools that make internet shoppers smarter. We are aggregating the user’s favorite ways of e-shopping (surfing), and integrated that into our proprietary technology, thus making Worldwide Classifieds very simple to navigate. Our Applications will give users access to multiple products and services which will include but are not limited to Auction Style Buying and Selling, “Reverse Auctions”, Travel Services and reviews, Digital and Print Coupon and Voucher Service, Internet Entrepreneur Training Curriculum, and current events.

 

Users need only to register one “Master Account” at any Worldwide Classifieds domain and they will have access to every site, service, and product that we offer. Users will not need to log into multiple accounts and keep track of multiple passwords, multiple receipts from multiple services. Our data bases will securely store and keep track of all of that data for each user who establishes a Worldwide Classifieds account, and each user can access that information from one location within the Worldwide Classifieds App or the Worldwide Classifieds website user dashboard.

 

The Internet Marketing Industry

 

Geo search technology is here and readily available. Because of this fact we are able to take advantage of the technology and manipulate it so that it works for the benefit of our users. We have not missed the fact that demographics and the technologies that are built into Mobile Devices will play a very important part in this equation.

 

Intellectual Property

 

We generally rely on trademark, copyright, and trade secret laws and employee and third-party non-disclosure agreements to protect our intellectual property and proprietary rights. We are currently in the process of pursuing trademark protection for our name and logos in the United States. Although we believe that our pending trademark applications will be granted by the United States Patent and Trademark Office, there can be no assurance that any trademarks will be granted or that any trademark relied upon by us in the future, if any, will not be challenged, invalidated or circumvented or that the rights granted thereunder or under licensing agreements will provide competitive advantages to the Company.

 

We also plan to rely on patents to protect its intellectual property and proprietary technology, to the extent feasible, and plans to consult with intellectual property counsel to determine what patents we may be able to file to protect our intellectual property. As of the date of this Offering Circular, we have not filed any patents in the United States or any other country. Although we believe that some of our technology may be patentable, there can be no assurance that any patents will be granted or that any patent relied upon by us in the future, if any, will not be challenged, invalidated or circumvented or that the rights granted thereunder or under licensing agreements will provide competitive advantages to the Company. We believe that due to the rapid pace of technological innovation for technology, mobile and internet products, our ability to establish and maintain a position of technological leadership in the Internet Marketing industry depends more on the skills and creativity of our development personnel than the legal protection afforded its existing technology. (See “Risk Factors”).

 

Our success depends in part, upon our proprietary software technology and proprietary Applications. There can be no assurance that our standard intellectual property confidentiality and assignment agreement with employees, consultants and others who participate in the development of its software will not be breached, that we will have adequate remedies for any breach, or that our trade secrets will not otherwise become known to or independently developed by competitors. Furthermore, there can be no assurance that our efforts to protect our proprietary technology will prevent others from developing and designing products or technology similar to or competitive with those of the Company.

Worldwide Classifieds Inc is primarily an internet-based business, which owns significant percentages in the following domains:

  1. worldwidec.org, which is the focal point of this offering. This website will offer merchant tools that will easily compete with eBay, Etsy, and other similar websites.
  2. worldwide-classifieds.org  and worldwideclassifieds.org  will back-up the parent at worldwidec.org, and will also serve as content storage and management systems.
  3. realthickinc.com  is a multifaceted digital magazine. Its primary function is to spur the interest in multiple demographics and from there drive the consumer to other points of interest, which we own or are in collaboration with other like businesses.
  4. www.realthick.net. Because this website's structure and function are of a proprietary nature we will not disclose a description here, however, we will state that it is the sister site of REAL THICK MAGAZINE and has a substantial role and is a driving force.
  5. b2bempowerment.org. B2B Empowerment’s primary function is to enlighten our communities by providing information and tools to the consumers in those communities that are both useful and relevant. B2B Empowerment will also offer an eCommerce training course. Once a merchant passes the course, we will offer a membership to a consortium-styled buying platform.
  6. New Light Media at www.visions.worldwidec.org is the media distribution hub for our merchants. YouTube tends to get noisy and can lead potential customers/clients away. New Light Media is our immediate solution to that issue.
  1. The UGRadioNetwork. There are already several online radio sites and stations for starving artist promoting their work. I not only believe we can do it better, I know we can.

Please note that this magazine “REAL THICK MAGAZINE” is our flagship and is being designed to capture and appeal to as many Internet users as possible. So it may seem a little risqué at points, however, we will not cross the line. We believe that this magazine should be fashionable, informative, sexy, and fun. Ages 16 and up should be fine.

DIRECTORS, EXECUTIVE OFFICERS & CORPORATE GOVERNANCE

 

The following are our executive officers and directors and their respective ages and positions as of the date of this Offering Circular:

 

Name

 

Position

 

Age

 

Term of Office

Executive Officers:

 

 

 

 

 

 

David Jackson

 

President and Chief Executive Officer

 

 58

 

Since November 2016

 

           

David Jackson

 

Chief Financial Officer, Treasurer, Secretary

 

 

 

Since November 2016

Directors:

 

 

 

 

 

 

David Jackson

 

Director

 

 

 

Since November 2016

Sade Blossie Jackson

 

Director

 

 

 

Since November 2016

 

Key Employees:

 

 

 

 

 

 

Ali Rashidifar

 

Product Manager

 

 

 

Since November 2016

 

During the past five (5) years, none of the persons identified above has been involved in any bankruptcy or insolvency proceeding or convicted in a criminal proceeding, excluding traffic violations and other minor offenses. There is no arrangement or understanding between the persons described above and any other person pursuant to which the person was selected to his or her office or position.

 

Executive Officers and Directors

 

David Jackson, Chief Executive Officer, & Director. 

Mr. Jackson is the creator of Worldwide Classifieds Inc. It was his vision, his energy, and diligent research that put the business planning for Worldwide Classifieds Inc. into motion. Though the Mr. Jackson is primarily self-thought when it comes to the business of Worldwide Classifieds Inc., and the bulk of knowledge and training has come from on-the-job experience, Mr. Jackson has clearly developed and has demonstrated an aptitude for simplifying complexed business solutions. Through his business experiences over the last six years Mr. Jackson has learned that teamwork is key, however, he has come to the realization that having a team that can also see the vision of the creator is paramount.

**PAGE EDIT PENDING - PAGE EDIT PENDING**

Board Leadership Structure and Risk Oversight

 

The Board oversees our business and considers the risks associated with our business strategy and decisions. The Board currently implements its risk oversight function as a whole. Each of the Board committees, when established, will also provide risk oversight in respect of its areas of concentration and reports material risks to the board for further consideration.

 

Term of Office

 

Directors serve until the next annual meeting and until their successors are elected and qualified. Officers are appointed to serve for one (1) year until the meeting of the Board following the annual meeting of shareholders and until their successors have been elected and qualified.

 

Director Independence

 

We use the definition of “independence” of The NASDAQ Stock Market to make this determination. NASDAQ Listing Rule 5605(a)(2) provides that an “independent director” is a person other than an officer or employee of the company or any other individual having a relationship which, in the opinion of the Company’s Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The NASDAQ listing rules provide that a director cannot be considered independent if:

 

 

the director is, or at any time during the past three (3) years was, an employee of the company;

 

 

the director or a family member of the director accepted any compensation from the company in excess of $120,000 during any period of twelve (12) consecutive months within the three (3) years preceding the independence determination (subject to certain exemptions, including, among other things, compensation for board or board committee service);

 

 

the director or a family member of the director is a partner in, controlling shareholder of, or an executive officer of an entity to which the company made, or from which the company received, payments in the current or any of the past three fiscal years that exceed 5% of the recipient’s consolidated gross revenue for that year or $200,000, whichever is greater (subject to certain exemptions;

 

 

the director or a family member of the director is employed as an executive officer of an entity where, at any time during the past three (3) years, any of the executive officers of the Company served on the compensation committee of such other entity; or

 

 

the director or a family member of the director is a current partner of the company’s outside auditor, or at any time during the past three (3) years was a partner or employee of the company’s outside auditor, and who worked on the company’s audit.

 

Under such definitions, we have no independent directors. However, our Common Stock is not currently quoted or listed on any national exchange or interdealer quotation system with a requirement that a majority of our Board be independent and, therefore, the Company is not subject to any director independence requirements.

 

Family Relationships

 

Sade B. Jackson, the daughter of David Jackson is an officer and director.

 

Involvement in Certain Legal Proceedings

 

Except as disclosed below, to our knowledge, none of our current directors or executive officers has, during the past ten (10) years:

 

 

·

been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

 

 

·

had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two (2) years prior to that time;

 

 

·

been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity;

 

 

·

been found by a court of competent jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated;

 

 

·

been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or

 

 

·

been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 

Except as set forth above and in our discussion below in “Certain Relationships and Related Transactions,” none of our directors or executive officers has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the SEC.

 

We are not currently a party to any legal proceedings, the adverse outcome of which, individually or in the aggregate, we believe will have a material adverse effect on our business, financial condition or operating results.

 

Code of Business Conduct and Ethics

 

 Our Board plans to adopt a written code of business conduct and ethics (“Code”) that applies to our directors, officers, and employees, including our principal executive officer, principal financial officer, and principal accounting officer or controller, or persons performing similar functions. We intend to post on our website a current copy of the Code and all disclosures that are required by law in regard to any amendments to, or waivers from, any provision of the Code.

**PLACEHOLDER - PAGE EDIT PENDING**

EXECUTIVE COMPENSATION

 

  The following table represents information regarding the total compensation our executive officers and director of the Company as of December ___, 2016:

  Cash     Other     Total  
    Compensation     Compensation     Compensation  
Name and Principal Position   ($)     ($)       ($)  
                   
David Jackson, President, CEO, Director  

125,000

               
 x                        
Sade Blossie Jackson, CFO, Directorr    94,000                
 x                        
P.M. Banks, COO, Treasurer, Secretary & Director   86,000                
 x                        
Terren S. Peizer, Director                  
 x                        
Ramy El-Batrawi, Chief Executive Officer &  Director  

 120,000

               
                 
                   
                   
                   
                         
                         
                         
                         
                         
                         
                         
                         
                         
//
 

(1)

The Company and Mr. Jackson have entered into an employment offer agreement, dated November 29, 2016, setting forth an initial base salary for Mr. Davis’s first three months of service and performance under his term of employment. As set forth under the employment offer, Mr. Jackson will be entitled to receive (i) $15,000 for his service in the month of December 2016, (ii) $10,000 for service performed during the month of January, 2017 and an additional $10,000 for service performed by Mr. Jackson during the month of February 2017.

 

 

(2)

The Company and Mr. Vanech have entered into an employment offer agreement, dated November 29, 2016, setting forth an initial base salary for Mr. Vanech first three months of service and performance under his term of employment. As set forth under the employment offer, Mr. Vanech will be entitled to receive (i) $15,000 for his service in the month of December 2016, (ii) $10,000 for service performed during the month of January, 2017 and (iii) an additional $10,000 for service performed by Mr. Vanech during the month of February 2017.

 

 

(3)

Any values reported in the “Other Compensation”, if applicable, column represents the aggregate grant date fair value, computed in accordance with Accounting Standards Codification ("ASC") 718 Share-Based Payments, of grants of stock options to each of our named executive officers and directors.

 

 

(4)

We currently do not have employment agreements with our executive officers; we intend to enter into such agreements by the first quarter of 2018.

 //

 

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

 

Transactions with Related Persons

 

On September 28, 2016 Worldwide Classifieds Inc. entered into a product management proposal with INETX Systems (the “Product Management Proposal”), whereas INETX Systems shall use its own personnel and other assets to provide product development services to the Company in the form of (a) design and development services to provide iOS and Android operating system capabilities for our mobile app “Worldwide Classifieds Mobile”, (b) design and development for a web registration portal for new users, and (c) development of web administration applications to allow high-level team members to be able to track user analytical information. On November 16, 2016, the Company adopted and ratified the terms of the Product Management Proposal and accepted the benefits of such arrangement on behalf of the Company.

 

INETX Systems is managed by Timothy C. Tuner, a key employee of our Company holding the position of product manager. Under the terms of the Product Management Proposal, the Company has agreed to pay INETX Systems compensation in the form of a management cost in an amount equal to $10,000 (paid on a monthly basis). Since November 16, 2016 (the date of the Company’s incorporation), the Company has paid INETX Systems $10,000 for their assistance in the development of www.newlightmedia.net (The New Light Media Group), www.b2bempowerment.org (B2B Empowerment), and www.worldwidec.org (Worldwide Classifieds). As a manager of INETX Systems, the Company believes that Mr. Turner will directly or indirectly benefit financially from our Product Management Proposal and it is further assumed, at this stage, that the Company will continue the engagement of INETX Systems for the performance of product management services under the Product Management Proposal beyond November 2017, whereby the Company anticipates that aggregate fees paid to INETX Systems will exceed an aggregate of $120,000 in total payments issue and received by INETX Systems.

 

To the best of our knowledge, since the period from inception (June 21, 2016) to December ____, 2016, other than as set forth above, there were no material transactions, or series of similar transactions, or any currently proposed transactions, or series of similar transactions, to which we were or are to be a party, in which the amount involved exceeds $120,000, and in which any director or executive officer, or any security holder who is known to us to own of record or beneficially own more than five percent (5%) of any class of our Common Stock, or any member of the immediate family of any of the foregoing persons, has an interest (other than compensation to our officers and directors in the ordinary course of business).

 //

SECURITY OWNERSHIP OF MANAGEMENT & CERTAIN SECURITY HOLDERS

 

The following table shows the beneficial ownership of our Common Stock as of the date of this Offering Circular held by (i) each person known to us to be the beneficial owner of more than five percent (5%) of any class of our shares; (ii) each director; (iii) each executive officer; and (iv) all directors and executive officers as a group. As of December _____, 2016, there are 70,000,000 shares of our Common Stock issued and outstanding.

 

Beneficial ownership is determined in accordance with the rules of the Commission, and generally, includes voting power and/or investment power with respect to the securities held. Shares of Common Stock subject to options and warrants currently exercisable or which may become exercisable within sixty (60) days of the date of this Offering Circular, are deemed outstanding and beneficially owned by the person holding such options or warrants for purposes of computing the number of shares and percentage beneficially owned by such person, but are not deemed outstanding for purposes of computing the percentage beneficially owned by any other person. Except as indicated in the footnotes to this table, the persons or entities named have sole voting and investment power with respect to all shares of Common Stock shown as beneficially owned by them.

 

The percentages below are based on fully diluted shares of our Common Stock as of the date of this Offering Circular. Unless otherwise indicated, the principal address of each of the persons below is c/o WORLDWIDE CLASSIFIEDS INC., 331 East Centerview, Carson, California 90746.

BENEFICIAL  OWNERSHIP

    Number of shares of              
    Common Stock Beneficially              
    Owned-as-of  December *, 2016      Percentage      Beneficially Owned(4)  
           Before Offering(3)      After Maximum Offering  
Directors and Officers:                        
David Jackson(1)     43,541,662       66.66666 %     62.202374285714 %
Sade Blossie Jackson(2)     20,208,338       33.33334 %     28.869054285714 %
All directors and named executive officers as a group (3) persons)     63,750,000       100 %     91.071428571428 %
                         
Greater than 5% Beneficial Owners:                        
David Jackson     43,541,662       66.666 %     62.20 %
Sade Blossie Jackson     20,208,338       33.333 %     28.80 %
(((Place Holder)))             0 %       %
                   
 (((Place Holder)))                  
                   
(((Place Holder)))             0 %       %
                   
 (((Place Holder)))                  
                   

 

(1) David Jackson, the Company’s founder, and Director.  

 

(2) Represents Common Stock beneficially owned and controlled by Sade Blossie Jackson, Director.

 

//

DESCRIPTION OF SECURITIES

 

The following is a summary of the rights of our capital stock as provided in our Articles of incorporation, bylaws, and Articles of designation. For more detailed information, please see our Articles of incorporation, bylaws, and Articles of designation which have been filed as exhibits to the Offering Statement of which this Offering Circular is a part.

 

General

 The Company is authorized to issue three classes of stock. The total number of shares of stock which the Company is authorized to issue is Three-Billion-Seventy-Million (3,070,000,000) shares of capital stock, consisting of Seventy-Million (70,000,000) shares of Common Stock, $0.000001 par value, Two Billion (2,000,000,000) shares of preferred stock, $0.000001 par value (the “Preferred Stock”), and One Billion Convertible Preferred, $0.000001 par value (the “Convertible Preferred Stock”). 

/Indebtedness.

As of the date of this Offering Circular, with the exception of approximately $86,000 in payables and debt obligations owed by the Company, we have no indebtedness or liabilities believed to be material to our business.

 

 Common Stock

As of the date of this Offering Circular, the Company had 63,750,000 shares of Common Stock issued and outstanding.

 

Voting

 The holders of the Common Stock are entitled to one vote for each share held at all meetings of shareholders (and written actions in lieu of a meeting). There shall be no cumulative voting. The holders of shares of Common Stock are entitled to dividends when and as declared by the Board from funds legally available therefor, and upon liquidation are entitled to share pro rata in any distribution to holders of Common Stock. There are no preemptive, conversion or redemption privileges, or sinking fund provisions with respect to the Common Stock.

 

Changes in Authorized Number

The number of authorized shares of Common Stock may be increased or decreased subject to the Company’s legal commitments at any time and from time to time to issue them, by the affirmative vote of the holders of a majority of the stock of the Company entitled to vote.

 

Preferred Stock

 The Preferred Stock may be issued from time to time in one or more series. The Board is authorized to fix the number of shares of any series of Preferred Stock and to determine the designation of any such series. The Board is also authorized to determine or alter the rights, preferences, privileges, and restrictions granted to or imposed upon any wholly unissued series of Preferred Stock and, within the limits and restrictions stated in any resolution or resolutions of the Board originally fixing the number of shares constituting any series, to increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any such series subsequent to the issue of shares of that series.

Currently, 1,000,000,000 shares of Preferred Stock have been designated as Series A Convertible Preferred Stock, all of which, subject to the closing of the 2018 Series A Preferred Stock offering, will be issued and outstanding.

 

2016 Series A Preferred Stock Offering

 The Board has designated 1,000,000,000 shares of its Preferred Stock as “Series A Convertible Preferred Stock” (the “Series A Preferred Shares”). 

The Series A Preferred Shares convey no dividend rights except as may be declared by the Board in its sole and absolute discretion, out of funds legally available for that purpose.

 

All, and not less than all of the then issued and outstanding shares of Series A Preferred Stock issued and outstanding shall automatically, and without any further action on the part of the Company or the holders of Series A Preferred Stock, be converted into Common Stock at the Conversion Price (defined below) then in effect (the “Automatic Conversion Shares”) upon the first to occur of (collectively, an “Automatic Conversion”):

 

 

The Company or any successor in interest to the Company raising a minimum of $5,000,000 of gross proceeds in the Company’s Tier 2 “Regulation A+ Offering”; or

 

 

The Company or any successor in interest to the Company completing a public offering of Common Stock or other securities on a Form S-1 and the listing of such Common Stock on the NASDAQ or NYSE, or other nationally recognized exchange (a “Public Offering”), or

 

 

The Company or any successor in interest to the Company effecting a merger or share exchange with an inactive or primarily inactive public company (“PubCo”) whose Common Stock (“PubCo Common Stock”) is listed on NASDAQ or NYSE, or other nationally recognized exchange (a “Reverse Merger Transaction”), as a result of which the stockholders of the Company or any successor in interest (including the holders of Series A Preferred Stock and/or Conversion Shares) will own, following the closing date of the Reverse Merger Transaction, in excess of eighty percent (80%) of the outstanding common stock of PubCo.

 

Each holder of Series A Preferred Stock shall be entitled to receive his, her or its pro-rata portion of the Automatic Conversion Shares determined by the amount of which the number of shares of Common Stock into which all of such holder’s shares of Series A Preferred Stock may be converted pursuant to the conversion ratio, bears to the total number of Automatic Conversion Shares.

 

Each full share of Series A Preferred Stock shall be convertible into Company Common Stock at a price equal to the lower of: (a) Six Dollars and 40/100 cents ($6.40), or (b) such other price which shall be equal to eighty (80%) percent of the initial offering price per share of shares of Common Stock of the Company offered to the public in connection with the Company’s Regulation A+ Offering (the “Conversion Price”). In the event that the initial offering price of per share of the Common Stock offered in such Regulation A+ Offering shall be less than Eight ($8.00) Dollars per share, the Conversion Price shall be reduced to eighty percent (80%) of such offering price.

 

In the event that a holder of shares of Series A Preferred Stock shall convert (at his or her option) all or a portion of such holder’s Series A Preferred Stock into Common Stock prior to the Company’s raising a minimum of $5,000,000 of gross proceeds in the Regulation A+ Offering, in accordance with the terms of such Regulation A+ Offering, then the Conversion Price of such Holders Series A Preferred Stock shall be reduced, pursuant to which the Company shall issue to the holder additional shares of Common Stock which, when combined with the Conversion Shares previously issued to such Holder, shall represent the result of dividing (i) the stated value of the Series A Preferred Stock converted, by (ii) the Conversion Price, as reduced (the “Make-Whole Shares”).

 

At any time following one (1) year from the last issuance date of Series A Preferred Stock to all of the holders, the Company shall have the right (but not the obligation) at its option, following the giving of written notice to all Holders of such Series A Preferred Stock (the “Redemption Notice”), to redeem all or any part of the then outstanding shares of the Series A Preferred Stock owned by such Holder at a redemption price per share equal to the stated value of the Series A Preferred Stock (the “Redemption Price”). If there shall be more than one holder of Series A Preferred Stock at the time a Redemption Notice shall be given, the Company shall redeem the applicable number of shares of Series A Preferred Stock from all Holders on an equitable and pro-rata basis. The applicable Redemption Price payable upon an optional redemption shall be due and payable within thirty (30) days following the date on which the Redemption Notice is provided by to the Company (the “Redemption Payment Date”). Notwithstanding the giving of a Redemption Notice, any Holder of Series A Preferred Stock shall have the absolute right to convert all or any portion of such Holder’s Series A Preferred Stock into Common Stock at any time or from time to time prior to the Redemption Payment Date.

 

Holders of Series A Preferred Shares shall not be entitled to vote on matters presented to our stockholders for action. However, the affirmative vote of the holders of a majority of the Series A Preferred then outstanding, voting as a separate class, is required for the Company to do any of the following:

 

 

·

amend, alter or repeal any of the preferences or rights of the Series A Preferred Shares;

 

·

authorize any reclassification of the Series A Preferred Shares;

 

·

increase the authorized number of Series A Preferred Shares; or

 

·

create any class or series of shares ranking senior to the Series A Preferred Shares as to liquidation.

 

The Series A Preferred Shares are not entitled to preemptive rights.

 

In the event of any dissolution, liquidation or winding up of the Company, whether voluntary or involuntary, the holders of Series A Preferred Shares shall be entitled to participate in any distribution out of the assets of the Company before any distribution or payment shall be made to the holders of Common Stock or any other junior security.

2018 Equity Incentive Plan

 

On November 30, 2016, we adopted our 2016 Equity Incentive Plan (the “Plan”) to reward and provide incentives to our officers, directors, employees, consultants and other eligible participants. We have set aside options to purchase up to Ten Million (10,000,000) shares of Common Stock for issuance under the Plan, which may be granted in the form of either incentive stock options or non-qualified stock options. Our Board of Directors administers the Plan, and has the authority: (i) to select the Plan recipients, the time or times at which awards may be granted, the number of shares to be subject to each option awarded, the vesting schedule of the options and (ii) to amend the stock option Plan to reward and provide incentives to its officers, directors, employees, consultants and other eligible participants. As of the date of this Offering Circular, Four Hundred Thousand (400,000) options have been granted under the Plan, of which Two Hundred Thousand (200,000) options have been granted to certain of our officers and directors. Subsequent to the completion of the Offering, the Company expects to continue to issue options as an inducement for managerial and qualified personnel to remain with and to join the Company.

 

We have not registered the Plan, or the shares subject to issuance thereunder, pursuant to the Securities Act. Absent registration, such shares, when issued upon exercise of options, would be “restricted securities” as that term is defined in Rule 144 under the Securities Act. Administration of the Plan is by our Board of Directors (the “Board”) or a committee appointed by the Board of Directors which consists of one (

 

 

or more members (the “Committee”). To date, no such Committee has been appointed, and the Board has elected to administer the Plan itself.

 

DESCRIPTION OF INDEBTEDNESS OF THE COMPANY

 

As of the date of this Offering Circular, we have no indebtedness or liabilities believed to be material to our business.

 

EMPLOYEES

 

As of the date of this Offering Circular, we had approximately six (6) full-time employees and eight (8) consultants, based at our offices. None of our employees are subject to a collective bargaining agreement, and we believe that our relations with our employees generally are good.

 

DIVIDEND POLICY

 

 

We plan to retain any earnings for the foreseeable future for our operations. We have never paid any dividends on our Common Stock and do not anticipate paying any cash dividends in the foreseeable future. Any future determination to pay cash dividends will be at the discretion of our Board and will depend on our financial condition, operating results, capital requirements and such other factors as our Board deems relevant.

 

PLAN OF DISTRIBUTION

 

The shares are being offered by us on a “best-efforts” basis by our officers, directors, and employees, with the assistance of independent consultants, and possibly through registered broker-dealers who are members of the Financial Industry Regulatory Authority (“FINRA”) and finders.

 

There is no aggregate minimum to be raised in order for the Offering to become effective and therefore the Offering will be conducted on a “rolling basis.” This means we will be entitled to begin applying “dollar one” of the proceeds from the Offering towards our business strategy, offering expenses, reimbursements, and other uses as more specifically set forth in the “Use of Proceeds” contained elsewhere in this Offering Circular.

 

 

We may pay selling commissions to participate broker-dealers who are members of FINRA for shares sold by them, equal to a percentage of the purchase price of the Common Stock shares. We may pay finder’s fees to persons who refer investors to us. We may also pay consulting fees to consultants who assist us with the Offering, based on invoices submitted by them for advisory services rendered. Consulting compensation, finder’s fees and brokerage commissions may be paid in cash, Common Stock or warrants to purchase our Common Stock. We may also issue shares and grant stock options or warrants to purchase our common stock to broker-dealers for sales of shares attributable to them, and to finders and consultants, and reimburse them for due diligence and marketing costs on an accountable or nonaccountable basis. We have not entered into selling agreements with any broker-dealers to date, though we may engage a FINRA registered broker-dealer firm for offering administrative services. Participating broker-dealers, if any, and others may be indemnified by us with respect to this offering and the disclosures made in this Offering Circular.

ADDITIONAL INFORMATION ABOUT THE OFFERING

 

Investment Limitations

 

Generally, no sale may be made to you in this Offering if the aggregate purchase price you pay is more than Ten Percent (10%) of the greater of your annual income or net worth (please see below on how to calculate your net worth). Different rules apply to accredited investors and non-natural persons. Before making any representation that your investment does not exceed applicable thresholds, we encourage you to review Rule 251(d)(2)(i)(C) of Regulation A. For general information on investing, we encourage you to refer to www.investor.gov.

 

Because this is a Tier 2, Regulation A offering, most investors must comply with the Ten Percent (10%) limitation on investment in the Offering. The only investor in this Offering exempt from this limitation is an “accredited investor” as defined under Rule 501 of Regulation D under the Securities Act (an “Accredited Investor”). If you meet one of the following tests you should qualify as an Accredited Investor:

 

 

(i)

You are a natural person who has had individual income in excess of $200,000 in each of the two (2) most recent years, or joint income with your spouse in excess of $300,000 in each of these years, and have a reasonable expectation of reaching the same income level in the current year;

 

 

 

 

 

 

(ii)

You are a natural person and your individual net worth, or joint net worth with your spouse, exceeds $1,000,000 at the time you purchase Shares (please see below on how to calculate your net worth);

 

 

 

 

 

 

(iii)

You are an executive officer or general partner of the issuer or a manager or executive officer of the general partner of the issuer;

 

 

 

 

 

 

(iv)

You are an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, or the Code, a corporation, a Massachusetts or similar business trust or a partnership, not formed for the specific purpose of acquiring the Shares, with total assets in excess of $5,000,000;

 

 

 

 

 

 

(v)

You are a bank or a savings and loan association or other institution as defined in the Securities Act, a broker or dealer registered pursuant to Section 15 of the Exchange Act, an insurance company as defined by the Securities Act, an investment company registered under the Investment Company Act of 1940 (the "Investment Company Act"), or a business development company as defined in that act, any Small Business Investment Company licensed by the Small Business Investment Act of 1958 or a private business development company as defined in the Investment Advisers Act of 1940;

 

 

 

 

 

 

(vi)

You are an entity (including an Individual Retirement Account trust) in which each equity owner is an accredited investor;

 

 

 

 

 

 

(vii)

You are a trust with total assets in excess of $5,000,000, your purchase of Shares is directed by a person who either alone or with his purchaser representative(s) (as defined in Regulation D promulgated under the Securities Act) has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment, and you were not formed for the specific purpose of investing in the Shares; or

 

 

(viii)

You are 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 assets in excess of $5,000,000.

 

Offering Period and Expiration Date

 

This Offering will start on or immediately prior to the date on which the SEC initially qualifies this Offering Statement (the “Qualification Date”) and will terminate on the Termination Date.

 

Procedures for Subscribing

 

If you decide to subscribe for Shares in this offering, you should:

 

 

1.

Electronically receive, review, execute and deliver to us a subscription agreement; and

 

 

2.

Deliver funds directly by wire or electronic funds     via ACH to ____________________.

 

Any potential investor will have ample time to review the subscription agreement, along with their counsel, prior to making any final investment decision. We shall only deliver such subscription agreement upon request after a potential investor has had ample opportunity to review this Offering Circular.

 

Right to Reject Subscriptions. After we receive your complete, executed subscription agreement and the funds required under the subscription agreement have been transferred to our designated account, we have the right to review and accept or reject your subscription in whole or in part, for any reason or for no reason. We will return all monies from rejected subscriptions immediately to you, without interest or deduction.

 

Acceptance of Subscriptions. Upon our acceptance of a subscription agreement, we will countersign the subscription agreement and issue the shares subscribed at closing. Once you submit the subscription agreement and it is accepted, you may not revoke or change your subscription or request your subscription funds. All accepted subscription agreements are irrevocable.

 

Under Rule 251 of Regulation A, non-accredited, non-natural investors are subject to the investment limitation and may only invest funds which do not exceed Ten Percent (10%) of the greater of the purchaser's revenue or net assets (as of the purchaser's most recent fiscal year end). A non-accredited, natural person may only invest funds which do not exceed Ten Percent (10%) of the greater of the purchaser's annual income or net worth (please see below on how to calculate your net worth).

 

NOTE: For the purposes of calculating your net worth, it is defined as the difference between total assets and total liabilities. This calculation must exclude the value of your primary residence and may exclude any indebtedness secured by your primary residence (up to an amount equal to the value of your primary residence). In the case of fiduciary accounts, net worth and/or income suitability requirements may be satisfied by the beneficiary of the account or by the fiduciary, if the fiduciary directly or indirectly provides funds for the purchase of the Shares.

 

In order to purchase our Common Stock shares and prior to the acceptance of any funds from an investor, an investor will be required to represent, to the Company’s satisfaction, that he is either an accredited investor or is in compliance with the Ten Percent (10%) of net worth or annual income limitation on investment in this Offering.

LEGAL MATTERS

 

Certain legal matters with respect to the shares of Common Stock offered hereby will be passed upon by CKR Law, LLP, Los Angeles, California.

 

EXPERTS

 

The financial statements of the Company appearing elsewhere in this Offering Circular have been included herein in reliance upon the report, which includes an explanatory paragraph as to the Company's ability to continue as a going concern, of AJ Robbins CPA, LLC, an independent certified public accounting firm, appearing elsewhere herein, and upon the authority of that firm as experts in accounting and auditing.

   

WHERE YOU CAN FIND MORE INFORMATION

 

We have filed with the SEC a Regulation A Offering Statement on Form 1-A under the Securities Act of 1993, as amended, with respect to the shares of Common Stock offered hereby. This Offering Circular, which constitutes a part of the Offering Statement, does not contain all of the information set forth in the Offering Statement or the exhibits and schedules filed therewith. For further information about us and the Common Stock offered hereby, we refer you to the Offering Statement and the exhibits and schedules filed therewith. Statements contained in this Offering Circular regarding the contents of any contract or another document that is filed as an exhibit to the Offering Statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the Offering Statement. Upon the completion of this Offering, we will be required to file periodic reports, proxy statements, and other information with the SEC pursuant to the Securities Exchange Act of 1934. You may read and copy this information at the SEC's Public Reference Room, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet website that contains reports, proxy statements, and other information about issuers, including us, that file electronically with the SEC. The address of this site is www.sec.gov.

Pursuant to the requirements of Regulation A, the issuer certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on

Form 1-A and has duly caused this offering statement to be signed on behalf by the undersigned, thereunto duly authorized, in Carson, State of California, on DATE PENDING.

  

 

WORLDWIDE CLASSIFIEDS INC.

 

 

 

 

 By:

/s/ David Jackson

 

 

Name: David Jackson

 

 

Title:  Chief Executive Officer, Director

 

 

This offering statement has been signed by the following persons in the capacities and on the date indicated.

 

Signature

 

Title

 

Date

 

 

 

 

 

 /s/ Sade B. Jackson

 

Vice President & Director

 

March 9, 2017

Sade B. Jackson

 

 

 

 

 

 

 

 

 

 

/s/ David Jackson

 

Chief Financial Officer, Treasurer, Secretary & Director

 

March 9, 2017

David Jackson

 

 

 

 

 

 

 

Part I – EXHIBITS

Exhibits000000000000000000000000000000000000 Description
EX1A-1A Articles of Incorporation of WORLDWIDE CLASSIFIEDS INC.
EX1A-2A Bylaws of WORLDWIDE CLASSIFIEDS INC.
EX1A-2B Amended and Restated Articles of Incorporation of WORLDWIDE CLASSIFIEDS INC.
EX1A-2C Articles of Designation, Preferences, and Rights of Series A Convertible Preferred Stock
EX1A-2D Form of Product Management Proposal
EX1A-2E Form of Employment Offer
EX1A-2F Form of 2016 Equity Incentive Plan
xxx xxx--------------------------Forward Actions Pending----------xxx-----Forward Actions Pending-------------------
xxx xxx--------------------------Forward Actions Pending----------xxx-----Forward Actions Pending-------------------
EX1A-4A Form of Agreement with xyz Financing Inc.**
EX1A-6B Limited Recourse Guaranty and Pledge with X, LLC, dated January 6, 2017**
EX1A-6C Secured Convertible Note to xyz Financing Inc., dated January 6, 2017**
EX1A-6D Common Stock Purchase Agreement with X, LLC, dated January 6, 2017**
EX1A-6E Promissory Note with X, LLC, dated January 15, 2017***
EX1A-6F Form of SAFE Agreement***
EX1A-6G Consent of xxx CPA, LLP***
EX1A-6H Amended Opinion of xxx CPA, LLP***
EX1A-6I Opinion of GRJ Law, LLP**
  .
.  
.  
EX1A-6B xxx--------------------------Forward Actions Pending----------xxx-----Forward Actions Pending-------------------
EX1A-6C xxx--------------------------Forward Actions Pending----------xxx-----Forward Actions Pending-------------------
EX1A-6D xxx--------------------------Forward Actions Pending----------xxx-----Forward Actions Pending-------------------
EX1A-6E xxx--------------------------Forward Actions Pending----------xxx-----Forward Actions Pending-------------------
  *
  **
  ***

 

       Leunea Myers CPA, LLP

Certified Public Accountant

 

To the Board of Directors

WORLDWIDE CLASSIFIEDS INC.

 

INDEPENDENT AUDITOR’S REPORT

 

Report on the Financial Statements

 

I have audited the accompanying financial statements of WORLDWIDE CLASSIFIEDS INC. (an Arizona Corporation), which comprise the balance sheet as of October 31, 2016, and the related statements of operations, changes in stockholders’ equity, and cash flows for the period from June 21, 2016 (inception) to October 31, 2016, and the related notes to the financial statements.

 

Management’s Responsibility for the Financial Statements

 

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatements.

 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, I express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Emphasis of Matter Regarding Going Concern

The accompanying financial statements have been prepared to assume that the Company will continue as a going concern. As described in Note 4 to the financial statements, The Company has not generated any revenues or profits since inception and has sustained a net loss of $1,017,325 for the period from June 21, 2016 (inception) to October 31, 2016.These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 4. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. My opinion is not modified with respect to this matter.

 

Opinion

 

In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of WORLDWIDE CLASSIFIEDS INC., as of October 31, 2016, and the results of its operations and its cash flows for the period from June 21, 2016 (inception) to October 31, 2016, in accordance with accounting principles generally accepted in the United States of America.

 

Clinton, Maryland

November 21, 2016

 

 

 

Leunea Myers CPA, LLP

Certified Public Accountant

Tax Dispute Resolution

 

  

 

WORLDWIDE CLASSIFIEDS INC.

BALANCE SHEET

As of October 31, 2016

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

Cash

 

$

160,675

 

TOTAL ASSETS

 

$

160,675

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

Due to related party

 

$

3,000

 

Total current liabilities

 

 

3,000

 

 

 

 

 

 

Commitments and contingencies (Note 7)

 

 

-

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

Preferred stock, $0.000001 par value; 10,000,000 shares authorized; nil shares issued and outstanding

 

 

 

 

Common stock, $0.000001 par value; 90,000,000 shares authorized; 24,264,708 shares issued and outstanding

 

 

24

 

Additional paid-in capital

 

 

1,174,976

 

Accumulated deficit

 

 

(1,017,325

)

Total stockholders' equity

 

 

157,675

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

160,675

 

 

See Independent Auditor’s Report and accompanying footnotes, which are an integral part of these financial statements

 

WORLDWIDE CLASSIFIEDS INC.

STATEMENT OF OPERATIONS

For the period from June 21, 2016 (inception) to October 31, 2016

 

Revenue

 

$

-

 

 

 

 

 

 

Operating expenses:

 

 

 

 

Selling and marketing expenses

 

 

111,741

 

Product development

 

 

371,063

 

General and administrative expenses

 

 

534,521

 

Total operating expenses

 

 

1,017,325

 

 

 

 

 

 

Net loss

 

$

(1,017,325

)

 

 

 

 

 

Weighted average shares outstanding :

 

 

 

 

Basic

 

 

20,067,486

 

Diluted

 

 

20,067,486

 

 

 

 

 

 

Loss per share

 

 

 

 

Basic

 

$

(0.05

)

Diluted

 

$

(0.05

)

 

See Independent Auditor’s Report and accompanying footnotes, which are an integral part of these financial statements.

 

WORLDWIDE CLASSIFIEDS INC.

STATEMENT OF STOCKHOLDERS' EQUITY

For the period from June 21, 2016 (inception) to October 31, 2016

 

 

 

 

 

 

 

 

 

Additional

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid-in

 

 

Accumulated

 

 

Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Equity

 

Balance at June 21, 2016 (inception)

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Issuance of founder shares

 

 

15,625,000

 

 

 

16

 

 

 

(16

)

 

 

 

 

 

 

-

 

Issuance of common stock for cash

 

 

8,639,708

 

 

 

8

 

 

 

1,174,992

 

 

 

 

 

 

 

1,175,000

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,017,325

)

 

 

(1,017,325

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance, October 31, 2016

 

 

24,264,708

 

 

$

24

 

 

$

1,174,976

 

 

$

(1,017,325

)

 

$

157,675

 

 

See Independent Auditor’s Report and accompanying footnotes, which are an integral part of these financial statements.

 

WORLDWIDE CLASSIFIEDS INC.

STATEMENT OF CASH FLOWS

For the period from June 21, 2016 (inception) to October 31, 2016

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

Net loss

 

$

(1,017,325

)

Adjustments to reconcile net loss to net
cash used in operating activities:

 

 

 

 

Increase in due to related party

 

 

3,000

 

Net cash used in operating activities

 

 

(1,014,325

)

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

Proceeds from sale of common stock

 

 

1,175,000

 

Net cash provided by financing activities

 

 

1,175,000

 

 

 

 

 

 

NET INCREASE IN CASH

 

 

160,675

 

 

 

 

 

 

CASH, BEGINNING OF PERIOD

 

 

-

 

 

 

 

 

 

CASH, END OF PERIOD

 

$

160,675

 

 

 

 

 

 

CASH PAID FOR:

 

 

 

 

Interest

 

$

-

 

Income taxes

 

$

-

 

 

See Independent Auditor’s Report and accompanying footnotes, which are an integral part of these financial statements.

 

WORLDWIDE CLASSIFIEDS INC.

NOTES TO FINANCIAL STATEMENTS

For the period from June 21, 2016 (inception) to October 31, 2016

 

Note 1 - Organization and Basis of Presentation

 

Organization and Line of Business

WORLDWIDE CLASSIFIEDS INC. (“WWC” or the “Company”) was incorporated on June 21, 2016, under the laws of the state of Arizona originally as a limited liability company and subsequently changed to a C corporation. The accompanying financial statements are retroactively restated to present the Company as a C corporation from June 21, 2016. The Company is a digital advertisement platform, peer communications network, and an online magazine.

 

Basis of Presentation

The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (GAAP).

 

The Company has elected to adopt early application of Accounting Standards Update No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements; the Company does not present or disclose inception-to-date information and other remaining disclosure requirements of Topic 915

.

The Company adopted the calendar year as its basis of reporting.

 

Note 2 – Summary of Significant Accounting Policies

 

Use of Estimates


The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates.

 

Cash Equivalents

For the purpose of the statement of cash flows, cash equivalents include time deposits, certificate of deposits, and all highly liquid debt instruments with original maturities of three months or less.

 

Fair Value of Financial Instruments


The Company discloses fair value information about financial instruments based upon certain market assumptions and pertinent information available to management.

 

Revenue and Cost Recognition


The Company intends to earn revenues through the sale of its app for smartphones. The Company recognizes revenue in accordance with FASB ASC 605, Revenue Recognition, only when the price is fixed or determinable, persuasive evidence of an arrangement exists, the services have been provided, and collectability is assured.  No revenues have been earned or recognized as of October 31, 2016. Expenses are recognized as incurred.

 

Income Taxes

The Company accounts for income taxes in accordance with ASC Topic 740, Income Taxes. ASC 740 requires a company to use the asset and liability method of accounting for income taxes, whereby deferred tax assets are recognized for deductible temporary differences, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion, or all of, the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

 

WORLDWIDE CLASSIFIEDS INC.

NOTES TO FINANCIAL STATEMENTS

For the period from June 21, 2016 (inception) to October 31, 2016

 

Under ASC 740, a tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not” test, no tax benefit is recorded. The adoption had no effect on the Company’s consolidated financial statements.

 

Basic and Diluted Earnings Per Share

Earnings per share are calculated in accordance with ASC Topic 260, Earnings Per Share. Basic earnings per share (“EPS”) is based on the weighted average number of common shares outstanding. Diluted EPS is based on the assumption that all dilutive securities are converted. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. There were no potentially dilutive securities outstanding during the period from June 21, 2016 (inception) to October 31, 2016.

 

Advertising Costs

The Company expenses the cost of advertising as incurred. Advertising costs from June 21, 2016 (inception) to October 31, 2016 were $111,741.

Research and Development Costs

The Company expenses its research and development costs as incurred. Developments costs from June 21, 2016 (inception) to October 31, 2016 were $371,063.

 

Software Development Costs

Software development costs are capitalized in accordance with FASB ASC 985-20 Cost of Software to Be Sold, Leased, or Marketed. Capitalization of software development costs begins upon the establishment of technological feasibility and is discontinued when the product is available for sale. The establishment of technological feasibility and the ongoing assessment of recoverability of capitalized software development costs require considerable judgment by management with respect to certain external factors, including, but not limited to, technological feasibility, anticipated future gross revenues, estimated economic life, and changes in software and hardware technologies. Capitalized software development costs are comprised primarily of direct overhead, payroll costs, and consultants' fees of individuals working directly on the development of specific software products.

 

Amortization of capitalized software development costs is provided on a product-by-product basis on the straight-line method over the estimated economic life of the products (not to exceed three years). Management periodically compares estimated net realizable value by product to a number of software development costs capitalized for that product to ensure the amount capitalized is not in excess of the amount to be recovered through revenues. Any such excess of capitalized software development costs over expected net realizable value is expensed at that time.

 

Organizational Costs


In accordance with FASB ASC 720, organizational costs, including accounting fees, legal fees, and costs of incorporation, are expensed as incurred.

The Company intends to file U.S. federal tax returns when due. All tax periods since inception remain open to examination by the taxing jurisdictions to which the Company is subject.

 

Note 3 – Stockholders’ Equity


The Company authorized 100,000,000 shares of capital stock with consists of 90,000,000 shares of common stock, $0.000001 par value per share and 10,000,000 shares of preferred stock, $0.000001 par value per share.

 

WORLDWIDE CLASSIFIEDS INC.

NOTES TO FINANCIAL STATEMENTS

For the period from June 21, 2016 (inception) to October 31, 2016

 

Common Stock

During the period from June 21, 2016 (inception) to October 31, 2016, the Company issued 15,625,000 shares to the founding stockholder at $0 value and issued 8,639,708 to investors for cash proceeds of $1,175,000.

 

Note 4 – Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.  The Company has not generated any revenues or profits since inception and has sustained a net loss of $1,017,325 for the period from June 21, 2016 (inception) to October 31, 2016. The Company’s ability to continue as a going concern for the next twelve months is dependent upon its ability to generate sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and its ability to obtain additional capital financing from investors. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Management plans to raise additional equity capital to the Company as necessary to fund expenditures until the Company’s planned principal operations can generate sufficient cash flows to sustain operations. No assurance can be made that these efforts will be successful and sustain the Company for a reasonable period of time.

 

Note 5 – Related Party Transactions

During the period from June 21, 2016 (inception) to October 31, 2016, the Company paid management fees of $110,000 to a company that is owned by the Company’s majority stockholder.

 

Note 6 – Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A full valuation allowance is established against all net deferred tax assets as of October 31, 2016, based on estimates of recoverability. While the Company has optimistic plans for its business strategy, it determined that such a valuation allowance was necessary given the current and expected near term losses and the uncertainty with respect to its ability to generate sufficient profits from its business model. Because of the impacts of the valuation allowance, there was no income tax expense or benefit for the period from June 21, 2016 (inception) to October 31, 2016.

A reconciliation of the differences between the effective and statutory income tax rates for the period from June 21, 2016 (inception) to October 31, 2016:

 

 

 

Amount

 

 

Percent

 

 

 

 

 

 

 

 

Federal statutory rates

 

$

(345,891

)

 

 

34.0

%

State income taxes

 

 

(50,866

)

 

 

5.0

%

Permanent differences

 

 

5,362

 

 

 

-0.5

%

Valuation allowance against net deferred
tax assets

 

 

391,395

 

 

 

-38.5

%

Effective rate

 

$

-

 

 

 

0.0

%

 

WORLDWIDE CLASSIFIEDS INC.

NOTES TO FINANCIAL STATEMENTS

For the period from June 21, 2016 (inception) to October 31, 2016

 

At October 31, 2016, the significant components of the deferred tax assets are summarized below:

 

Deferred income tax asset

 

 

 

 

Net operation loss carryforwards

 

 

391,395

 

Total deferred income tax asset

 

 

391,395

 

Less: valuation allowance

 

 

(391,395

)

Total deferred income tax asset

 

$

-

 

 

The valuation allowance increased by $391,395 in 2016 as a result of the Company generating additional net operating losses.

The Company has recorded as of October 31, 2016, a valuation allowance of $391,395, as it believes that it is more likely than not that the deferred tax assets will not be realized in future years. Management has based its assessment on the Company’s lack of profitable operating history.

 

The Company conducts an analysis of its tax positions and has concluded that it has no uncertain tax positions as of October 31, 2016.

The Company has net operating loss carryforwards of approximately $1,000,000. Such amounts are subject to IRS code section 382 limitations and expire in 2031. The 2016 tax year is still subject to audit.

 

Note 7 – Commitments and Contingencies

On July 28, 2016, the Company entered into a client service agreement with an advertising agency. The agency is to obtain negotiate, arrange and purchase and otherwise deal with all media placements for the Company’s product in television, radio and print ads. The Company is obligated to compensate the adverting agency a commission of 15% of the gross amounts charged for the television, radio and print ads.

 

On August 27, 2016, the Company entered into a development agreement with a software developer to develop interface software for the Company’s product. The Company agreed to pay a fee of $4,860 plus $85 per hour for the software development services.

On November 1, 2016, the Company entered into an agreement with an individual to perform marketing services. The individual will receive compensation as follows:

 

 

·

5% of any investment the Company receives as
a result of the individual's efforts;

 

 

·

10% of gross ad revenue achieved;

 

 

·

$5,000 per month through May 2017 payable in
cash; and

 

 

·

$20,000 per month through May 2017 payable in
equity.

 

Note 8 – Recent Accounting Pronouncements

In June 2014, the FASB issued Accounting Standards Update (ASU)  2014-10 which eliminated the requirements for development stage entities to (1) present inception-to-date information in the statements of income, cash flows, and stockholders’ equity, (2) label the financial statements as those of a development stage entity, (3) disclose a description of the development stage activities in which the entity is engaged, and (4) disclose in the first year in which the entity is no longer a development stage entity that in prior years it had been in the development stage. This ASU is effective for annual reporting periods beginning after December 15, 2014, and interim periods beginning after December 15, 2015. Early application is permitted for any annual reporting period or interim period for which the entity’s financial statements have not yet been issued. Upon adoption, entities will no longer present or disclose any information required by Topic 915. The Company has early adopted the new standard effective as of the inception date.

 

aj@ajrobbins.com

 

3773 Cherry Creek North Drive, Suite 575 East, Denver, Colorado 80209

 

(B)303-331-6190 (M)720-339-5566 (F)303-845-9078

WORLDWIDE CLASSIFIEDS INC.

NOTES TO FINANCIAL STATEMENTS

For the period from June 21, 2016 (inception) to October 31, 2017

 

 

In August 2014, the FASB issued ASU 2014-15 on “Presentation of Financial Statements Going Concern

 

(Subtopic 205-40) – Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”. Currently, there is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this update provide such guidance. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). The amendments in this update are effective for public and nonpublic entities for annual periods ending after December 15, 2016. Early adoption is permitted. The Company has not elected to early adopt this pronouncement.

 

Management does not believe that any recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under the circumstances.

 

Note 9 – Subsequent Events

 

Pursuant to ASC 855-10, the Company has evaluated all events or transactions that occurred from November 1, 2016, to November 21, 2016.  The Company did not have any material recognizable subsequent events during this period except for the following:

 

PENDING

 

As a result of the debt financing, interest expense in the future periods is expected to increase.

 

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