RECENT SALES OF UNREGISTERED SECURITIES AND USE OF PROCEEDS FROM REGISTERED
SECURITIES
During the nine months ended September 30, 2006, The Company issued 6,700,000
shares of stock at fair value of $128,400 for compensation to an employee.
Additionally the company issued 15,400,000 shares of stock at fair value of
$521,600 for consulting services.
On August 1, 2006, the Company merged with SBD International Inc., with SBD
being the surviving entity. Upon execution of the merger, an exchange of one
share of SBD common stock was issued for every 25 shares of our common stock.
This reduced the outstanding shares to approximately 8,794,000 shares of common
stock.
On August 17, 2006 5,100,000 shares, the entire outstanding Series A Preferred
Stock, was converted into 265,200,000 shares of common stock at an exchange
ratio of 1 to 52.
On August 31, 2006 an employee shareholder returned 143,000 shares of common
stock for no compensation.
Total shares outstanding as of December 29, 2006 were approximately 274,353,041.
None of the transactions involved any underwriters, underwriting discounts or
commissions, or any public offering. The Company has been advised that each
transaction was exempt from the registration requirements of the Securities Act
by virtue of Section 4(2) thereof and Regulation D promulgated thereunder. The
recipients in such transaction represented their intention to acquire the
securities for investment only and not with a view to or for sale in connection
with any distribution thereof appropriate legends were affixed to the share
certificates issued in such transactions. All recipients had adequate access,
through their relationships with the Company, to obtain information about the
Company.
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EXHIBITS.
The following exhibits are included as part of this Form SB-2.
Exhibit No. Description
3.1 Articles of Incorporation of SBD International, Inc. (2)
3.2 Bylaws of SBD International, Inc. (2)
5.1 Gersten Savage LLP Opinion and Consent (to be filed by amendment)
10.1 Securities Purchase Agreement dated September 28, 2006 (1)
10.2 Callable Secured Convertible Note dated September 28, 2006 (1)
10.3 Callable Secured Convertible Note dated September 28, 2006 (1)
10.4 Callable Secured Convertible Note dated September 28, 2006 (1)
10.5 Callable Secured Convertible Note dated September 28, 2006 (1)
10.6 Stock Purchase Warrant dated September 28, 2006 (1)
10.7 Stock Purchase Warrant dated September 28, 2006 (1)
10.8 Stock Purchase Warrant dated September 28, 2006 (1)
10.9 Stock Purchase Warrant dated September 28, 2006 (1)
10.10 Registration Rights Agreement dated September 28, 2006, by and among SBD
International Inc. and the Investors named on the signature pages thereto
(1)
10.11 Guaranty and Pledge Agreement dated September 28, 2006, by and among SBD
International, Inc. and the Investors named on the signature pages thereto
(1)
10.12 Security Agreement dated September 28, 2006, by and among SDB
International, Inc. and the Investors named on the signature pages thereto
(1)
14.1 Code of Ethics (filed herewith)
23.1 Consent of Bangell Josephs & Company L.L.C Certified Public
Accountants (filed herewith)
23.2 Consent of legal counsel (filed herewith)
(1) Incorporated by reference to the Company's Current Report on Form 8-K filed
on October 3, 2006.
(2) Incorporated by reference to the Company's Registration Statement on Form
SB-2/A filed on July 1, 2005
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CODE OF ETHICS
The Board of Directors has adopted a Code of Business Conduct and Ethics (Code)
that is applicable to our directors, principal executive and financial officer,
principal accounting officer or controller, and persons performing similar
functions. A copy of the Code is included in this report as Exhibit 14.1. A copy
of the Code may be obtained by anyone, without charge, by requesting a copy
either by telephoning (954) 489 2961 or fax: (954) 489-2962.
UNDERTAKINGS
The undersigned Registrant hereby undertakes to:
(1) File, during any period in which it offers or sells securities, a
post-effective amendment to this Registration Statement to:
(i) Include any prospectus required by Section l0 (a) (.3) for the Securities
Act,
(ii) Reflect in the prospectus any facts or events which, individually or
together, represent a fundamental change in the information in the
registration statement; and notwithstanding the forgoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in the volume and
price represent no more than a twnety percent (20%) change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement, and
(iii) Include any additional changed material information on the plan of
distribution.
(2) For determining liability under the Securities Act, treat each such
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial
bonafide offering thereof.
(3) File a post-effective amendment to remove from registration any of the
securities, which remain unsold at the end of the offering.
(4) Provide to the transfer agent at the closing, certificates in such
denominations and registered in such names as are required by the transfer
agent to permit prompt delivery to each purchaser.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the small
business issuer pursuant to the foregoing provisions, or otherwise, the small
business issuer has been advised that in the opinion of the Securities and
Exchange Commission 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
the small business issuer of expenses incurred or paid by a director, officer or
controlling person of the small business issuer 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 small business
issuer 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 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.
We will file, during any period in which we offer or sell securities, a
post-effective amendment to this registration statement to reflect in the
prospectus any facts or events which, individually or together, represent a
fundamental change in the information in the registration statement.
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