Email : info@otcjournal.com
URL : http://www.otcjournal.com
To
OTC Journal Members:
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Private
Placement Opportunity |
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In this edition we are going to introduce
to a Private Placement opportunity. We believe that this Company
has a good chance of going public within the next one to two years
at a value considerably higher than this private placement price, but there
are no guarantees.
Here are some examples of Private
Placements that investors were invited into in the early stages:
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America On-Line (NYSE: AOL) at $1.35-
5/28/92
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Intel (NASDAQ: INTC)at $1.45-7/21/86
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Cisco Systems (NASDAQ: CSCO) at $.42
on 10/11/90
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Microsoft (NASDAQ: MSFT) at $.39
on 8/4/86
This is the second private placement
we have featured this year. We have had no direct involvement with
this company, but have been closely following them for over a year.
We met with them last week, and were favorably impressed with their progress,
and it is our personal belief that they have a good chance to be highly
successful and make a difference in the lives of millions of children.
A Private Placement occurs when an
investor purchases newly issued shares directly from a Corporation.
Individuals, professional venture capitalists, and money managers make
investments of this type regularly. The funds that you invest go
directly to the corporation to provide capital for growth and expansion.
Unparalleled returns can be generated for Private Investors that purchase
shares of companies at low valuations prior to the Companies going public.
Here are some basics about private
placements that you should understand before we get into the specifics
about this company:
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This company is not a Public Company
at this time, and there are no guarantees that it will ever become
one. Therefore, any investment that you make may never have any market
or liquidity in either a private or public market. You must
assume that your risk is 100% of the capital you invest, so you must be
prepared to lose 100% of the capital you invest. You must also be
prepared to set the capital aside indefinitely.
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We are not recommending that you
invest.
This is not a solicitation to buy or sell any securities. We will
give you the facts and put you directly in touch with the company.
You make up your own mind.
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We have no formal affiliation with this
company, and are not being compensated in any way for disseminating this
information. However, there is an indirect relationship between the
company and one of the partners in the company that publishes this newsletter.
This newsletter is published by MarketByte, LLC. One of the partners
in MarketByte is a shareholder of 1st Net Technologies (OTC PS: FNTT).
1st Net is also the largest shareholder in the featued company.
This relationship could be construed as a conflict of interest.
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There are many complex securities laws
governing investments in Private Placements. There are SEC regulations
that apply to all US citizens and every State has its own individual regulations.
If you decide to contact the company they will be aware of the regulations
that apply in your case, and you may prohibited from investing even if
you wish to. In order to invest you will probably be required to
sign a document stating that you are an Accredited Investor in order to
comply with both State and Federal regulations. Here is the SEC definition
of an Accredited Investor according to SEC Rule 501 Of Regulation D:
| Any natural person whose individual
net worth, or joint net worth with that person's spouse, exceeds $1,000,000;
or Any natural person who had an individual income in excess of $200,000
in each of the two most recent years or joint income with that person's
spouse in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the current year. |
Because this company is located in
California, there is a special regulation that applies to California
residents. If you fall under the following California definition
of a Qualified Purchaser you will be allowed to invest if you choose
to do so: Here is the definition of a Qualified Purchaser:
| A California resident, who
alone, or in combination with their spouse, have a net worth in excess
of $500,000, exclusive of home and furnishings or had an individual income
in excess of $100,000 last year, and have a reasonable expectation of reaching
that income level in the current year and a net worth of at least $250,000
exclusive of home and furnishings. |
If you do not reside in California,
and are not an accredited investor under the SEC guidelines, there is no
reason for you to read any further. You will not be permitted to
invest even if you choose to do so because of SEC regulations. If
you are a California resident but do not qualify under the California guidelines
you will not be permitted to invest.
Now that we have gotten through the
preliminary general information of Private Placements, we'll give you an
overview of the Company. If you like what you read and wish to receive
the Investment Marketing Memorandum/Subscription Agreement, a link
to a sign up page can be found at the end of this newsletter.
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Children's
Technology Group, Inc. |
|
http://www.abctg.com
Click
Here For Company Contact Information
Our use of the Internet is evolving
faster than most people imagined several years ago. In order to navigate
the Internet you use a Browser, which is likely to be Microsoft IE, Netscape,
or AOL's browser, which is actually Microsoft technology with AOL's cosmetic
over it.
We believe that using the browser
as you know it today will evolve to a whole new level. Think of your
browser as the car you use to drive the roads of the Internet. When
the automobile was first introduced everybody used one basic style of car
to go everywhere you could. Today there are a wide variety of cars
to choose from. You purchase a vehicle based on your special needs.
You might drive a motocross motorcycle, sports car, economy car, or luxury
sedan. You choose based on where you want to go and how you want
to get there.
As the use of the Internet grows
and people become more sophisticated in its use, you will be able to choose
the Browser you want to use to navigate the Internet depending on your
specialized interests. You may use multiple browsers depending on
what your particular interest is at the time you are using it. If
own several cars, you choose one to drive depending on where you are going.
You will soon have multiple browser choices depending on where you want
to go, and unlike the car they will all be free.
Last Friday's proposal by the Justice
Department to break Microsoft into two separate companies is further evidence
that our navigation choices will be expanding.
To clarify, here is a specific example.
Suppose you are a football fan. You open your football browser.
It is already pre-configured to take you to places of interest specifically
for football fans. There will be a button to take you directly to
the weekend scheduling of games. Injury reports and pre-game reports
will be easy to find. There will be direct links to e-commerce sites
that carry hats, t-shirts, and other accessories. Pre-game analysis
from a variety of sources will also be easily available. The search
feature will take you to only football related internet sites.
The Children's Technology Group(CTG)
is developing what could become the definitive specialized browser/community
application for children. Not only will it provide a totally safe
environment for children, it will also provide appropriate age specific
content with total parental control.
Keeping the Internet safe for
kids is one of the most critical and high profile issues we face today.
The FCC has mandated that Internet Service Providers have some method in
place to keep the Internet safe for children. Most current technology
deals with the blocking of pornography. Our due diligence indicates
that there is no technology that filters or blocks web sites that would
also be deemed inappropriate material by most parents. Examples include
making bombs, growing marijuana, buying cigarettes online, satanic web
sites showing graphic pictures, hate and violence sites, etc. CTG’s
product addresses this issue and seems to have lead on the competition.
CTG is committed to building
the world's largest online community for children. Through the creation
and development of innovative Internet-safe products, they provide children
with fun, easy-to-use, and meaningful tools for their education, entertainment,
and exploration of the Internet in a safe and secure environment.
The software backbone of their first
release is referred to as the "MindWalker" series. It is called the
Crayon Crawler, and is available now. For all parents concerned
with the perils of the Internet we recommend you go to their web site.
You can go download a working version to experiment with at www.crayoncrawler.com.
You must be using the Microsoft IE 5.0 to download and use the Crayon
Crawler. The file is very large. If you are connected by
a dial up modem you should contact the company directly and ask them to
send you a free cd/rom to do the installation.
The Crayon Crawler has some
very unique and distinct features that include:
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The first “talking chat room” for kids
with built in language filters to prevent profanity.
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Desktop lockdown to prevent children
from launching other programs parents don’t want their children in.
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White list or included list browsing.
Children can ONLY surf pre-approved web sites.
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Talking animated characters that speak
and interact with the children.
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A closed email system to block all forms
of spam which also utilizes a language filter to block profanity.
They do not intent to attempt to create
an on-line community using the Crayon Crawler brand. The barrier
to entry for this model is about $100 million. Their business model
calls for them use their technology to create private label and co-branded
versions of their Browser technology. They intend to form alliances
and license their technology with major household names to develop a private
label or co-branded version with companies that already have massive brand
label exposure, but are not in the technology industry. This gives
their partners the cause related benefit of protecting kids online.
It allows them to leverage their massive brand exposure onto the Internet.
The sponsoring company now has its brand seen every time the child gets
on the computer.
CTG becomes the technology
partner that enables the strategic partner to create an online community.
The larger company becomes the distribution and marketing partner for CTG.
A major benefit to this model is rapid market penetration through leveraging
the brand of the strategic partner. CTG’s acquisition cost
per user/subscriber will be minimal as compared to other online companies.
They have targeted the following
groups for strategic alliances:
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Food/ Consumer- Cereal
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PC manufacturers
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Internet Services Providers
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CD bundlers
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Major Media- TV
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Software Developers
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Search Engines
They are in various levels of
discussion with major household names in each one of the above mentioned
catagories. We will not publish any of the targeted names
unless there is a signed contract. However, if you decide to investigate
this opportunity further, an officer or director of CTG should be
willing to share that information with you personally.
Their revenue model covers every
area of the dot com world. CTG is willing to vend the technology
to partners with massive brand exposure in return for sharing in back end
revenues. There will be little to no up front license fees.
This appears to give them an advantage in getting in the doors of some
major distribution partners. The revenue sharing includes sponsor
advertising, monthly subscription fees, premium subscription fees, e-commerce
and Internet service fees.
The company's revenue model is predicated
on developing a large community of users through private labeling with
major household names. Those brands are then used to market the the
Kid-Safe community environment/technology. The revenue model is fully
described in the Investment Marketing Memorandum.
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The
Offeringl |
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CTG is raising capital through
a unit private placement. You can invest in one unit for $4.
Here is the formal description:
| Each Unit acquired through
the offering, an investor will receive one share of Participating, Convertible,
Voting, Cumulative Series “A” Preferred Stock and one warrant entitling
the registered holder thereof to purchase one share of Common Stock at
an exercise price of $6.00 per share exercisable immediately and expiring
on the one year anniversary date of the closing of a firmly-underwritten
public offering covering the primary sale of Common Stock with total equity
of not less than $5,000,000. If not expired or exercised prior thereto,
the Warrants automatically shall expire at 12:01 a.m. on April 17, 2003.
Each Preferred Share automatically converts into one share of Common Stock
upon the earlier to occur of (i) the closing of a firmly underwritten public
offering covering the primary sale of Common Stock with total equity of
the Company at the closing of such offering of not less than $5,000,000,
or (ii) the date that the trading price for the shares of Common Stock
is $8.00 per share or higher. |
The Unit is structured to provide
investors with two separate opportunities to make money. The Preferred
stock becomes your profit vehicle if the company goes public, and the warrant
becomes an additional profit vehicle if the stock trades above $6.
A second exit strategy could be a buy out of CTG if the right suitor
comes along.
Qualified investors can receive an
Investment
Marketing Memordum/Subscription Agreement directly from the company.
If you are not an accredited investor under SEC regulations as described
above you can not participate. The only exception is California Residents,
which qualify under the special California requirement.
The link below will take you to a
sign up page. If you decide to fill out the information and send
it, your form will go directly to an officer or director of CTG
who will get back to you and answer any questions you might have.
Your information will be kept strictly confidential.
High net worth investors should take
a look at CTG. They are intimately involved in the business
of keeping the Internet safe for kids, and that is the most important Internet
related issue for parents today. The opportunity for growth in this
niche is substantial, and we are hoping that CTG becomes the leader.
Get the information and judge for yourself. Here is your link:
Click
Here To Go To The Registration Page
or go to this web address:
http://www.envoymail.com/autoform.asp?view_only=1&formid=512
Alternatively, you can call the company directly-
ask for Investor Relations at 888-284-4414.
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