Attached files
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-1/A
AMENDMENT NO. 4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
KIDS GERM DEFENSE CORP.
------------------------------
(Name of Small Business Issuer in its Charter)
Florida 2380 26-4090511
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(State or Other Jurisdiction (Primary Standard Industrial (IRS Employer
of Organization) Classification Code) Identification #)
KIDS GERM DEFENSE CORP. Mark Nicholas
6279 Buckingham St 6279 Buckingham St.
Sarasota, FL 34238 Sarasota, FL 34238
941-650-3850 941-650-3850
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(Address and telephone of (Name, address and telephone
registrant's executive office) number of agent for service)
Approximate date of proposed sale to the public: After this registration
statement becomes effective
If the securities being registered herein will be sold by the security
shareholders on a delayed or continuous basis pursuant to Rule 415 of the
Securities Act of 1933 please check the following box. [X]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
CALCULATION OF REGISTRATION FEE
Title of Each Proposed Proposed
Class of Maximum Maximum Amount of
Securities to Amount to be Offering Price Aggregate Registration
be Registered Registered Per Unit (1) Offering Price Fee (2)
-------------- ------------ -------------- -------------- ------------
Common Stock 3,000,000 $0.01 $30,000 $3.14
by Company par
value $0.001
(1) The offering price has been arbitrarily determined by the Company and bears
no relationship to assets, earnings, or any other valuation criteria. No
assurance can be given that the shares offered hereby will have a market value
or that they may be sold at this, or at any price.
(2) Estimated solely for the purpose of calculating the registration fee based
on Rule 457 (o)
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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PROSPECTUS
KIDS GERM DEFENSE CORP.
3,000,000 SHARES OF COMMON STOCK
Prior to this registration, there has been no public trading market for the
common Stock of KIDS GERM DEFENSE CORP. ("KGDC") and it is not presently traded
on any market or securities exchange. 3,000,000 shares of common stock are being
offered for sale by the Company to the public.
The price per share will be $0.01. KGDC intends to sell all shares and will
receive all proceeds from the sale. The Company may not sell these securities
until the registration statement filed with the Securities and Exchange
Commission is effective.
INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
BEGINNING ON PAGE 9 OF THIS PROSPECTUS FOR A DISCUSSION OF INFORMATION THAT
SHOULD BE CONSIDERED IN CONNECTION WITH AN INVESTMENT IN OUR SECURITIES.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of the prospectus. Any representation to the contrary is a
criminal offense.
This offering is self-underwritten. No underwriter or person has been engaged to
facilitate the sale of shares of common stock in this offering. There are no
underwriting commissions involved in this offering.
The Company is not required to sell any specific number or dollar amount of
securities but will use its best efforts to sell the securities offered.
_______________
The information in this prospectus is not complete and may be changed. This
prospectus is not an offer to sell these securities and is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
SHARES OFFERED SELLING AGENT PROCEEDS TO THE
BY COMPANY PRICE TO PUBLIC COMMISSIONS COMPANY
------------------------ --------------- -------------- ---------------
Per Share $0.01 Not applicable $0.01
Minimum Purchase None Not applicable Not applicable
Total (3,000,000 shares) $30,000 Not applicable $30,000
The shares are intended to be sold by the Chief Executive Officer of the Company
who will receive no commission or other remuneration directly or indirectly
related to the sale thereof. This offering will be conducted through the safe
harbor provisions of Rule 3a4(i) of the Exchange Act of 1934.
This offering will terminate upon the earlier to occur of (i) 90 days after this
registration statement becomes effective with the Securities and Exchange
Commission, or (ii) the date on which all 3,000,000 shares registered hereunder
have been sold. The Company may at its discretion extend the offering for an
additional 90 days.
Proceeds to the Company do not include offering costs (filing fees, printing
costs, legal fees, accounting fees, and transfer agent fees) estimated at
$5,000. KGDC will pay these expenses.
This Prospectus is dated _____________, 2009
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TABLE OF CONTENTS Page No.
SUMMARY OF OUR OFFERING..................................................... 5
DESCRIPTION OF PROPERTY..................................................... 7
SUMMARY OF OUR FINANCIAL INFORMATION........................................ 7
RISK FACTORS................................................................ 7
USE OF PROCEEDS............................................................. 16
DETERMINATION OF OFFERING PRICE............................................. 17
DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES............................... 17
PLAN OF DISTRIBUTION........................................................ 19
LEGAL PROCEEDINGS........................................................... 20
BUSINESS.................................................................... 20
REGULATORY MATTERS.......................................................... 21
STRATEGY AND PRODUCTS....................................................... 21
THE MARKET.................................................................. 22
MANAGEMENT.................................................................. 23
SALES AND MARKETING......................................................... 23
SHOWS AND ADVERTISING....................................................... 23
COMPETITION................................................................. 23
STAFFING.................................................................... 24
EMPLOYEES AND EMPLOYMENT AGREEMENTS......................................... 24
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION................... 25
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL...................... 27
LIQUIDITY AND CAPITAL RESOURCES............................................. 28
CODE OF BUSINESS CONDUCT AND ETHICS......................................... 30
MANAGEMENT.................................................................. 30
CONFLICTS OF INTEREST....................................................... 31
COMMITTEES OF THE BOARD OF DIRECTORS........................................ 31
EXECUTIVE COMPENSATION...................................................... 32
PRINCIPAL STOCKHOLDERS...................................................... 35
DESCRIPTION OF SECURITIES................................................... 36
REPORTING................................................................... 37
STOCK TRANSFER AGENT........................................................ 37
STOCK OPTION PLAN........................................................... 37
LITIGATION.................................................................. 37
LEGAL MATTERS............................................................... 37
EXPERTS..................................................................... 37
FINANCIAL STATEMENTS........................................................ F-1
Management Certification..............................................
Net Income Per Common Share...........................................
Revenue and Cost Recognition..........................................
DEALER PROSPECTUS DELIVERY OBLIGATION
Until _______ (90 days after the effective date of this prospectus), all dealers
that effect transactions in these securities, whether or not participating in
this offering, may be required to deliver a prospectus. This is in addition to
the dealer obligation to deliver a prospectus when acting as underwriters and
with respect to their unsold allotments or subscriptions.
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SUMMARY INFORMATION
This summary provides an overview of select information contained in this
prospectus. It does not contain all the information that you should consider
before making a decision to purchase the shares offered by KGDC. You should very
carefully and thoroughly read the more detailed information in this prospectus
and review the financial statements contained herein.
SUMMARY OF OUR OFFERING
KGDC has 9,000,000 shares of common stock issued and outstanding. Through this
offering the Company will register 3,000,000 shares of common stock for offering
to the public. These shares represent additional common stock to be issued by
the Company. The Company may endeavor to sell all 3,000,000 shares of common
stock after this registration becomes effective. The price at which the Company
offers these shares is fixed at $0.01 per share for the duration of the
offering. There is no arrangement to address the possible effect of the offering
on the price of the stock. KGDC will receive all proceeds from the sale of the
common stock.
Our business and registered office is located at 6279 Buckingham St, Sarasota,
FL 34238. Our telephone number is 941-650-3850.
Securities being offered by the 3,000,000 shares of common stock, par
Company. value $0.0001 offered by the Company.
Offering price per share by the The price, if and when the Company sells
Company. shares of common stock, is set at $0.01.
Number of shares outstanding before 9,000,000 common shares are currently
the offering of common shares. issued and outstanding.
Number of shares outstanding after 12,000,000 common shares will be issued
the offering of common shares. and outstanding after this offering is
completed.
The minimum number of shares to be None.
sold in this offering.
Market for the common shares. There is no public market for the common
shares. The price per share is $0.01.
KGDC may not be able to meet the
requirement for a public listing or
quotation of its common stock. Further,
even if KGDC common stock is quoted or
granted listing, a market for the common
shares may not develop.
The offering price for the shares will
remain $0.01 per share for the duration
of the offering.
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Use of Proceeds KGDC will receive all proceeds from the
sale of the common stock and intends to
use the proceeds from this offering to
formulate the business and marketing
plan. The expenses of this offering,
including the preparation of this
prospectus and the filing of this
registration statement, estimated at
$5,000.00 are being paid for by KGDC.
Termination of the Offering This offering will terminate upon the
earlier to occur of (i) 90 days after
this registration statement becomes
effective with the Securities and
Exchange Commission, or (ii) the date on
which all 3,000,000 shares registered
hereunder have been sold. The Company
may at its discretion extend the
offering for an additional 90 days.
Terms of the Offering The Company's president and sole
director will sell the common stock upon
effectiveness of this registration
statement.
You should rely only upon the information contained in this prospectus. KDGC has
not authorized anyone to provide you with information different from that which
is contained in this prospectus. The Company is offering to sell shares of
common stock and seeking offers to buy shares of common stock only in
jurisdictions where offers and sales are permitted.
SUMMARY INFORMATION ABOUT KIDS GERM DEFENSE CORP.
KIDS GERM DEFENSE CORP. ("KGDC", "we", "the Company") is a development-stage
company, incorporated in the State of Florida on January 16, 2009, as a
for-profit company, and an established fiscal year end of December 31. The
Company intends to engage in the manufacturing, wholesaling, marketing and sales
of "Germ Defense" products for children 0 to 10 years of age.
The Company intends to develop, market, and sell through retail distribution
channels (mass merchant retail, food and drug chains, independent and e-commerce
retailers) a line of Germ Defense products throughout the United States. The
company has registered the domain name kidsgermdefense.com. The company has not
begun development of its website.
The Company intends to develop and launch these products for home and on-the-go
needs. The Company initially intends its products to include: disposable and
germ proof high chair and table placemats, disposable and re-usable changing
table covers, Public Toilet Protectors, Disposable and Re-usable Germ Proof
Shopping Cart Covers, Antibacterial Towelettes, Educational Children's Books
related to Germ Defense. The Company intends to expand the product line pending
a successful launch of its initial product line.
KGDC has not generated any revenues to date and our activities have been limited
to developing our business plan. The Company will not have the necessary capital
to develop or execute our business plan until the Company is able to secure
financing. There can be no assurance that such financing will be available on
suitable terms.
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As of June 30, 2009, KGDC had raised $6,000 through the sale of its common
stock. There is $210 cash on hand in our corporate bank account and currently
has accounts payable and liabilities of $2,000 as of June 30, 2009. In addition,
the Company anticipates that the costs associated with this offering will be
approximately $ 5,000. As of the date of this prospectus, the Company has not
generated or realized any revenues from our business operations. The following
financial operation summarizes the more complete historical financial
information as indicated on the audited financial statements the Company has
filed with this prospectus.
DESCRIPTION OF PROPERTY
The Company does not own any real estate or other properties. The Company's
office is located at 6279 Buckingham St., Sarasota, FL 34238 and our telephone
number is 941-650-3850. Our fax number is 941-650-3850. Our Domain Name is
www.kidsgermdefense.com the business office is located at the home of Mark
Nicholas, the CEO of the Company at no charge
SUMMARY OF OUR FINANCIAL INFORMATION
The following summary financial information for the periods stated summarizes
certain information from our financial statements included elsewhere in this
prospectus. You should read this information in conjunction with Management's
Plan of Operations, the financial statements and the related notes thereto
included elsewhere in this prospectus.
As of
Balance Sheet June 30, 2009
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Total Assets $ 210
Total Liabilities $ 2,000
Equity $ 210
For the Year ended
Operating Data June 30, 2009
------------------ ------------------
Revenue Nil
Net Loss $ 7,141
Net Loss Per Share $0.00079
As indicated in the financial statements accompanying this prospectus, KGDC has
had no revenue to date and has incurred only losses since inception. The company
has had no operations and has been issued a "going concern" opinion by its
auditor, based upon the Company's reliance upon the sale of our common stock as
the sole source of funds for our future operations.
RISK FACTORS
Please consider the following risk factors and other information in this
prospectus relating to our business and prospects before deciding to invest in
our common stock.
This offering and any investment in our common stock involves a high degree of
risk. You should carefully consider the risks described below and all of the
information contained in this prospectus before deciding whether to purchase our
common stock. If any of the following risks actually occur, our business,
financial condition and results of operations could be harmed. The trading price
of our common stock could decline due to any of these risks, and you may lose
all or part of your investment.
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The Company considers the following to be the material risks for an investor
regarding this offering. KGDC should be viewed as a high-risk investment and
speculative in nature. An investment in our common stock may result in a
complete loss of the invested amount. Please consider the following risk factors
before deciding to invest in our common stock.
Risks Related to Investing in Our Company
-----------------------------------------
BECAUSE THE COMPANY HASN'T PRODUCED A SAMPLE OF OUR PRODUCTS, OR BUILT A
PROTOTYPE OF OUR GERM DEFENSE PRODUCT RETAIL MERCHANDISING, OUR PRODUCTS MAY NOT
WORK PROPERLY AND/OR THE PRODUCTION COST CAN EXCEED EXPECTATIONS
The Company has not produced any samples of our products or a prototype of our
product retail merchandising; therefore, the Company does not know the exact
cost of production. In the case of a higher than expected cost of production,
the Company won't be able to offer our products at a reasonable price.
Furthermore, the Company may find problems in the manufacturing process and/or
product function. If the Company is unable to develop our products, the Company
will have to cease our operations, resulting in the complete loss of your
investment.
OUR LACK OF AN OPERATING HISTORY GIVES NO ASSURANCE THAT OUR FUTURE OPERATIONS
WILL RESULT IN PROFITABLE REVENUES, WHICH COULD RESULT IN THE SUSPENSION OR END
OF OUR OPERATIONS
The Company was incorporated on January 16, 2009 and the Company has not
realized any revenues to date. The Company has very little operating history
upon which an evaluation of our future success or failure can be made. Our
ability to achieve and maintain profitability and positive cash flow is
dependent upon the completion of this offering and our ability to generate
revenues through sales of our products.
Based upon current plans, the Company expects to incur operating losses in
future periods because the Company will be incurring expenses and not generating
revenues. We cannot guarantee that we will be successful in generating revenues
in the future. Failure to generate revenues will cause us to go out of business.
THE COMPANY IS A NEW COMPANY WITH NO OPERATING HISTORY AND WE FACE A HIGH RISK
OF BUSINESS FAILURE WHICH WOULD RESULT IN THE LOSS OF YOUR INVESTMENT
The Company is a development stage Company formed recently to carry out the
activities described in this prospectus and thus have only a limited operating
history upon which an evaluation of its prospects can be made. The Company was
incorporated on January 16, 2009 and to date has been involved primarily in the
development of our business plan. The Company has no business operations. Thus,
there is no internal or industry-based historical financial data upon which to
estimate our planned operating expenses.
The Company expects that its results of operations may also fluctuate
significantly in the future as a result of a variety of market factors
including, among others, the entry of new competitors offering a similar
product; the availability of motivated and qualified personnel; the initiation,
renewal or expiration of our customer base; pricing changes by the Company or
its competitors, specific economic conditions in the germ defense industries and
general economic conditions. Accordingly, our future sales and operating results
are difficult to forecast.
As of the date of this prospectus, the Company has earned no revenue. Failure to
generate revenue will cause us to go out of business, which could result in the
complete loss of your investment.
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OUR CURRENT OFFICER AND DIRECTOR DOES NOT HAVE EXPERIENCE IN STARTING A GERM
DEFENSE PRODUCTS COMPANY AND THE COMPANY LACKS CUSTOMERS OR SUPPLIERS, OUR
BUSINESS HAS A HIGHER RISK OF FAILURE
Although our Chief Executive Officer and Director has extensive business
experience, he does not have experience in developing a new product category for
Germ Defense Products for children or in the development of internet e-commerce.
Additionally, the Company currently has no contracts or agreements with
customers or suppliers or manufacturers of the Company's intended products.
Therefore, without this experience, contracts or suppliers, their business
experience may not be enough to effectively start-up and maintain a Germ Defense
Products company. As a result, the implementation of our business plan may be
delayed, or eventually, unsuccessful.
BECAUSE THE COMPANY IS SMALL AND DOES NOT HAVE MUCH CAPITAL, WE MUST LIMIT OUR
MARKETING ACTIVITIES. AS A RESULT, OUR SALES MAY NOT BE ENOUGH TO OPERATE
PROFITABLY. IF THE COMPANY DOES NOT MAKE A PROFIT, THE COMPANY MAY HAVE TO
SUSPEND OR CEASE OPERATIONS
Due to the fact the Company is small and does not have much capital, we must
limit our marketing activities to potential customers having the likelihood of
purchasing our products. The Company intends to generate revenue through the
sale of our products. Because the Company will be limiting the scope of our
marketing activities, the Company may not be able to generate enough sales to
operate profitably. If we cannot operate profitably, the Company may have to
suspend or cease operations.
OUR OPERATING RESULTS MAY PROVE UNPREDICTABLE WHICH COULD NEGATIVELY AFFECT OUR
PROFIT
Our operating results are likely to fluctuate significantly in the future due to
a variety of factors, many of which the Company has no control. Factors that may
cause our operating results to fluctuate significantly include: our inability to
generate enough working capital from future equity sales; the level of
commercial acceptance by retailers and consumers of our products; fluctuations
in the demand for germ defense products; the amount and timing of operating
costs and capital expenditures relating to expansion of our business, operations
and infrastructure and general economic conditions.
If realized, any of these risks could have a material adverse effect on our
business, financial condition and operating results.
THE COMPANY'S SOLE OFFICER AND DIRECTOR MAY NOT BE IN A POSITION TO DEVOTE A
MAJORITY OF HIS TIME TO THE COMPANY, WHICH MAY RESULT IN PERIODIC INTERRUPTIONS
AND EVEN BUSINESS FAILURE
Mr. Nicholas, our sole officer and director, has other outside business
activities and is devoting approximately 10-25 hours per week to our operations.
Our operations may be sporadic and occur at times which are not convenient to
Mr. Nicholas, which may result in periodic interruptions or suspensions of our
business plan. Such delays could have a significant negative effect on the
success of the business.
KEY MANAGEMENT PERSONNEL MAY LEAVE THE COMPANY WHICH COULD ADVERSELY AFFECT THE
ABILITY OF THE COMPANY TO CONTINUE OPERATIONS
Because the Company is entirely dependent on the efforts of its sole officer and
director, his departure or the loss of other key personnel in the future, could
have a material adverse effect on the business. The Company believes that all
commercially reasonable efforts have been made to minimize the risks attendant
with the departure by key personnel from service.
- 9 -
However, there is no guarantee that replacement personnel, if any, will help the
Company to operate profitably. The Company does not maintain key person life
insurance on its sole officer and director.
IF THE COMPANY IS DISSOLVED, IT IS UNLIKELY THAT THERE WILL BE SUFFICIENT ASSETS
REMAINING TO DISTRIBUTE TO THE SHAREHOLDERS
In the event of the dissolution of the Company, the proceeds realized from the
liquidation of its assets, if any, will be used primarily to pay the claims of
the Company's creditors, if any, before there can be any distribution to the
shareholders. In that case, the ability of purchasers of the offered shares to
recover all or any portion of the purchase price for the offered shares will
depend on the amount of funds realized and the claims to be satisfied there
from.
THE COMPANY MAY BE UNABLE TO GAIN ANY SIGNIFICANT MARKET ACCEPTANCE FOR OUR
PRODUCTS OR ESTABLISH A SIGNIFICANT MARKET PRESENCE WE MAY BE UNABLE TO GENERATE
SUFFICIENT REVENUE TO CONTINUE OUR BUSINESS
The Company's growth strategy is substantially dependent upon its ability to
market its products successfully to prospective clients. However, its planned
products may not achieve significant acceptance. Such acceptance, if achieved,
may not be sustained for any significant period of time. Failure of the
Company's products to achieve or sustain market acceptance could have a material
adverse effect on our business, financial conditions and the results of our
operations.
MANAGEMENT'S ABILITY TO IMPLEMENT THE BUSINESS STRATEGY MAY BE SLOWER THAN
EXPECTED AND THE COMPANY MAY BE UNABLE TO GENERATE A PROFIT
Our plans include obtaining business from major retailer organizations which may
not occur. Our growth strategy is subject to significant risks which you should
carefully consider before purchasing the shares the Company is offering.
Although we plan on researching our products carefully, the products may be slow
to achieve profitability, or may not become profitable at all, which will result
in losses. There can be no assurance that the Company will succeed.
The Company may be unable to enter into its intended markets successfully. The
factors that could affect our growth strategy include our success in (a)
obtaining orders from Mass Merchants and E-Commerce Retailers and Independents
(b) obtaining adequate financing on acceptable terms and (c) adapting our
internal controls and operating procedures to accommodate our future growth.
Our systems, procedures and controls may not be adequate to support the
expansion of our business operations. Significant growth will place managerial
demands on all aspects of our operations. Our future operating results will
depend substantially upon our ability to manage changing business conditions and
to implement and improve our technical, administrative and financial controls
and reporting systems.
IF KIDS GERM DEFENSE CORP. IS UNABLE TO MANAGE ITS FUTURE GROWTH ITS BUSINESS
COULD BE HARMED
If the Company experiences significant growth in the foreseeable future, its
growth may place a significant strain on management, financial, operating and
technical resources. Failure to manage growth effectively could have a material
adverse effect on the Company's financial condition or the results of its
operations.
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Since inception January 16, 2009 to June 30, 2009, KGDC has spent a total of
$7,790.00 on start-up costs. The Company has not generated any revenue from
business operations. All proceeds currently held by the Company are the result
of the sale of common stock to its officers.
OUR PRODUCT MAY NOT BE ABLE TO DISTINGUISH ITSELF IN THE MARKET AND WE MAY BE
UNABLE TO ATTRACT ENOUGH CLIENTS TO OPERATE PROFITABLY, WITHOUT A PROFIT WE MAY
HAVE TO SUSPEND OR CEASE OPERATIONS
Our product will target the Kids Germ Defense market. If the Company is unable
to demonstrate clearly the concept that makes our products unique to potential
customers, they may think that it is only another germ defense product. If the
public doesn't acknowledge the singularity and innovation of our products, we
may be unable to attract enough clients.
THE COMPANY MAY BE UNABLE TO MAKE NECESSARY ARRANGEMENTS AT ACCEPTABLE COST, THE
COMPANY MAY HAVE TO SUSPEND OR CEASE OPERATIONS ENTIRELY WHICH COULD RESULT IN A
TOTAL LOSS OF YOUR INVESTMENT.
Because the Company is a small business, with limited assets, the Company is not
in a position to assume unanticipated costs and expenses. If the Company has to
make changes in the Company structure or are faced with circumstances that are
beyond our ability to afford, the Company may have to suspend operations or
cease operations entirely which could result in a total loss of your investment.
COMPETITORS MAY ENTER THIS SECTOR WITH SUPERIOR PRODUCTS, INFRINGING OUR
CUSTOMER BASE, AND AFFECTING OUR BUSINESS ADVERSELY.
The Company has identified a market opportunity for our products. Competitors
may enter this sector with superior products, service, conditions and/or
benefits. This would infringe on our customer base, have an adverse affect upon
our business and the results of our operations.
Auditor's Going Concern
-----------------------
THERE IS SUBSTANTIAL UNCERTAINTY ABOUT THE ABILITY OF KGDC TO CONTINUE ITS
OPERATIONS AS A GOING CONCERN
In their audit report dated August 21, 2009; our auditors have expressed an
opinion that substantial doubt exists as to whether we can continue as an
ongoing business. Because our officers may be unwilling or unable to loan or
advance any additional capital to KGDC we believe that if the Company does not
raise additional capital within 12 months of the effective date of this
registration statement, the Company may be required to suspend or cease the
implementation of our business plan. Due to the fact that there is no minimum
investment and no refunds on sold shares, you may be investing in a company that
will not have the funds necessary to develop its business strategies. As such
the Company may have to cease operations and you could lose your entire
investment. See the "March 31, 2009 Audited Financial Statements - Auditors
Report". Because the Company has been issued an opinion by its auditors that
substantial doubt exists as to whether it can continue as a going concern it may
be more difficult to attract investors.
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Risks Related To Our Financial Condition
----------------------------------------
SINCE KGDC ANTICIPATES OPERATING EXPENSES WILL INCREASE PRIOR TO EARNING
REVENUE, IT MAY NEVER ACHIEVE PROFITABILITY
The Company anticipates an increase in its operating expenses, without realizing
any revenues from the sale of its products. Within the next 12 months, the
Company will have costs related to (i) creating a product line (samples), (ii)
initiation of the Company's sales and marketing campaign, (iii) administrative
expenses and (iv) the expenses of this offering.
There is no history upon which to base any assumption as to the likelihood that
the Company will prove successful. We cannot provide investors with any
assurance that our products will attract customers; generate any operating
revenue or ever achieve profitable operations. If the Company is unable to
address these risks, there is a high probability that our business can fail,
which will result in the loss of your entire investment.
IF THE COMPANY CANNOT SECURE ADDITIONAL CAPITAL, OR IF AVAILABLE CAPITAL IS TOO
EXPENSIVE, OUR BUSINESS WILL FAIL.
The Company requires $30,000 to formulate the business and marketing plan. This
amount includes the $5,000 required for offering expense. Company will require
additional funding of approximately $400,000 to fully execute our business plan
and bring our products to the marketplace. The company intends to accomplish
this in two phases. Phase one will require additional funding of $130,000 to
begin implementing the business plan. This includes establishing and produce
prototype products (samples), development of packaging and merchandising
materials. Phase two will require additional funding of $270,000 to execute the
Company's sales and marketing strategy. The Company anticipates 12 months of
operational losses at approximately $6,750.00 per month before we can generate
adequate cash flow to cover operations. As of June 30, 2009, the Company had
cash on hand of $210.
No assurance can be given that the Company will obtain access to capital markets
in the future or that adequate financing to satisfy the cash requirements of
implementing our business strategies will be available on acceptable terms. The
inability of the Company to gain access to capital markets or obtain acceptable
financing could have a material adverse effect upon the results of its
operations and its financial conditions.
If the Company is not successful in earning revenue once the Company has started
our sale activities, the Company may require additional financing to sustain our
business operations. Currently, the Company does not have any arrangements for
financing and can provide no assurances to investors that the Company will be
able to obtain any when required. Obtaining additional financing would be
subject to a number of factors, including the Company's sales results. These
factors may have an affect on the timing, amount, terms or conditions of
additional financing and make such additional financing unavailable to us.
Risks Related To This Offering
------------------------------
BECAUSE THERE IS NO PUBLIC TRADING MARKET FOR OUR COMMON STOCK, YOU MAY NOT BE
ABLE TO RESELL YOUR STOCK
There is currently no public trading market for our common stock. Therefore,
there is no central place, such as a stock exchange or electronic trading
system, to resell your shares. If you do want to resell your shares, you will
have to locate a buyer and negotiate your own sale.
- 12 -
The offering price and other terms and conditions relative to the Company's
shares have been arbitrarily determined by the Company and do not bear any
relationship to assets, earnings, book value or any other objective criteria of
value. Additionally, as the Company was formed recently and has only a limited
operating history and no earnings, the price of the offered shares is not based
on its past earnings and no investment banker, appraiser or other independent
third party has been consulted concerning the offering price for the shares or
the fairness of the offering price used for the shares.
INVESTING IN THE COMPANY IS HIGHLY SPECULATIVE AND COULD RESULT IN THE ENTIRE
LOSS OF YOUR INVESTMENT
Purchasing the offered shares is highly speculative and involves significant
risk. The offered shares should not be purchased by any person who cannot afford
to lose their entire investment. The business objectives of the Company are also
speculative, and it is possible that we would be unable to accomplish them. The
Company's shareholders may be unable to realize a substantial or any return on
their purchase of the offered shares and may lose their entire investment. For
this reason, each prospective purchaser of the offered shares should read this
prospectus and all of its exhibits carefully and consult with their attorney,
business and/or investment advisor.
INVESTING IN OUR COMPANY MAY RESULT IN AN IMMEDIATE LOSS BECAUSE BUYERS WILL PAY
MORE FOR OUR COMMON STOCK THAN THE PRO RATA PORTION OF THE ASSETS ARE WORTH
The Company has only been recently formed and has only a limited operating
history and no earnings, therefore, the price of the offered shares is not based
on any data. The offering price and other terms and conditions regarding the
Company's shares have been arbitrarily determined and do not bear any
relationship to assets, earnings, book value or any other objective criteria of
value. No investment banker, appraiser or other independent third party has been
consulted concerning the offering price for the shares or the fairness of the
offering price used for the shares. The Company's net tangible book value per
share of common stock is $.0010.
The arbitrary offering price of $0.01 per common share as determined herein is
substantially higher than the net tangible book value per share of the Company's
common stock. KGDC's assets do not substantiate a share price of $0.01. This
premium in share price applies to the terms of this offering. The offering price
will not change for the duration of the offering even if the Company obtains a
listing on any exchange or becomes quoted on the OTC Bulletin Board.
BECAUSE THE COMPANY HAS 100,000,000 AUTHORIZED SHARES, MANAGEMENT COULD ISSUE
ADDITIONAL SHARES, DILUTING THE CURRENT SHARE HOLDERS' EQUITY
The Company has 100,000,000 authorized shares, of which only 9,000,000 are
currently issued and outstanding and only 12,000,000 will be issued and
outstanding after this offering terminates. The Company's management could,
without the consent of the existing shareholders, issue substantially more
shares, causing a large dilution in the equity position of the Company's current
shareholders. Additionally, large share issuances would generally have a
negative impact on the Company's share price. It is possible that, due to
additional share issuance, you could lose a substantial amount, or all, of your
investment.
- 13 -
AS THE COMPANY DOES NOT HAVE AN ESCROW OR TRUST ACCOUNT WITH SUBSCRIPTIONS FOR
INVESTORS, IF WE FILE FOR OR ARE FORCED INTO BANKRUPTCY PROTECTION, INVESTORS
WILL LOSE THE ENTIRE INVESTMENT
Invested funds for this offering will not be placed in an escrow or trust
account and if we file for bankruptcy protection or a petition for involuntary
bankruptcy is filed by creditors against us, your funds will become part of the
bankruptcy estate and administered according to the bankruptcy laws. As such,
you will lose your investment and your funds will be used to pay creditors.
THE COMPANY DOES NOT ANTICIPATE PAYING DIVIDENDS IN THE FORESEEABLE FUTURE, SO
THERE WILL BE LESS WAYS IN WHICH YOU CAN MAKE A GAIN ON ANY INVESTMENT IN THIS
COMPANY
The Company does not anticipate paying dividends on our common stock in the
foreseeable future, but plan rather to retain earnings, if any, for the
operation growth and expansion of our business.
AS THE COMPANY MAY BE UNABLE TO CREATE OR SUSTAIN A MARKET FOR OUR SHARES, WE
MAY BE EXTREMELY ILLIQUID
If no market develops, the holders of our common stock may find it difficult or
impossible to sell their shares. Further, even if a market develops, our common
stock will be subject to fluctuations and volatility. Additionally, the Company
cannot apply directly to be quoted on the Over-The-Counter Bulletin Board (OTC)
and must have a broker-dealer acting as market-maker apply on the company's
behalf and make quotations on the OTC Bulletin Board. The Company's stock may be
listed or traded only to the extent that there is interest by broker-dealers in
acting as a market maker. Despite the Company's best efforts, it may not be able
to convince any broker/dealers to act as market-makers and make quotations on
the OTC Bulletin Board. The Company may consider pursuing a listing on the OTCBB
after this registration becomes effective and the Company has completed its
offering.
IN THE EVENT THAT THE COMPANY'S SHARES ARE TRADED, THEY MAY TRADE UNDER $5.00
PER SHARE AND THUS WILL BE A PENNY STOCK. TRADING IN PENNY STOCKS HAS MANY
RESTRICTIONS AND THESE RESTRICTIONS COULD SEVERELY AFFECT THE PRICE AND
LIQUIDITY OF THE COMPANY'S SHARES
In the event that our shares are traded, and our stock trades below $5.00 per
share, our stock would be known as a "penny stock", which is subject to various
regulations involving disclosures to be given to you prior to the purchase of
any penny stock. The U.S. Securities and Exchange Commission (the "SEC") has
adopted regulations which generally define a "penny stock" to be any equity
security that has a market price of less than $5.00 per share, subject to
certain exceptions. Depending on market fluctuations, our common stock could be
considered to be a "penny stock". A penny stock is subject to rules that impose
additional sales practice requirements on broker/dealers who sell these
securities to persons other than established customers and accredited investors.
For transactions covered by these rules, the broker/dealer must make a special
suitability determination for the purchase of these securities. In addition, he
must receive the purchaser's written consent to the transaction prior to the
purchase. He must also provide certain written disclosures to the purchaser.
Consequently, the "penny stock" rules may restrict the ability of broker/dealers
to sell our securities, and may negatively affect the ability of holders of
shares of our common stock to resell them. These disclosures require you to
acknowledge that you understand the risks associated with buying penny stocks
and that you can absorb the loss of your entire investment. Penny stocks are low
priced securities that do not have a very high trading volume. Consequently, the
price of the stock is often volatile and you may not be able to buy or sell the
stock when you want to.
- 14 -
SINCE OUR SOLE OFFICER AND DIRECTOR CURRENTLY OWNS 100% OF THE OUTSTANDING
COMMON STOCK, INVESTORS MAY FIND THAT HIS DECISIONS ARE CONTRARY TO THEIR
INTERESTS YOU SHOULD NOT PURCHASE SHARES UNLESS YOU ARE WILLING TO ENTRUST ALL
ASPECTS OF MANAGEMENT TO THE SOLE OFFICER AND DIRECTOR, OR HIS SUCCESSORS
The Company's sole officer and director Mark Nicholas owns 9,000,000 shares of
common stock representing 100% of the Company's outstanding stock Mr. Nicholas
will own 9,000,000 shares of common stock after this offering is completed
representing 75% of the Company's outstanding shares assuming all securities are
sold. As a result, he may have control of the Company and be able to choose all
of our directors. His interests may differ from the ones of other stockholders.
Factors that could cause his interests to differ from the other stockholders
include the impact of corporate transactions on the timing of business
operations and his ability to continue to manage the business given the amount
of time he is able to devote to the Company.
All decisions regarding the management of the Company's affairs will be made
exclusively by him. Purchasers of the offered shares may not participate in the
management of the Company and, therefore, are dependent upon his management
abilities. The only assurance that the shareholders of the Company, including
purchasers of the offered shares, have that the Company's sole officer and
director will not abuse his discretion in executing the Company's business
affairs, is his fiduciary obligation and business integrity. Such discretionary
powers include, but are not limited to, decisions regarding all aspects of
business operations, corporate transactions and financing. Accordingly, no
person should purchase the offered shares unless willing to entrust all aspects
of management to the sole officer and director, or his successors. Potential
purchasers of the offered shares must carefully evaluate the personal experience
and business performance of the Company's management.
FORWARD-LOOKING STATEMENTS
This prospectus contains certain forward-looking statements regarding
management's plans and objectives for future operations, including plans and
objectives relating to our planned entry into our business. The forward-looking
statements and associated risks set forth in this prospectus include or relate
to, among other things, (a) our projected profitability, (b) our growth
strategies, (c) anticipated trends in our industry, (d) our ability to obtain
and retain sufficient capital for future operations, and (e) our anticipated
needs for working capital. These statements may be found under "Management's
Discussion and Analysis or Plan of Operation" and "Description of Business," as
well as in this prospectus generally. Actual events or results may differ
materially from those discussed in these forward-looking statements as a result
of various factors, including, without limitation, the risks outlined under
"Risk Factors" and matters described in this prospectus generally. In light of
these risks and uncertainties, the forward-looking statements contained in this
prospectus may not in fact occur.
The forward-looking statements herein are based on current expectations that
involve a number of risks and uncertainties. Such forward-looking statements are
based on the assumptions that the Company will be able to continue our business
strategies on a timely basis, that the Company will attract customers, that
there will be no material adverse competitive conditions under which our
business operates, that our sole officer and director will remain employed as
such, and that our forecasts accurately anticipate market demand. The foregoing
assumptions are based on judgments with respect to, among other things, future
economic, competitive and market conditions, and future business decisions, all
of which are difficult or impossible to predict accurately and many of which are
beyond our control. Accordingly, although we believe that the assumptions
underlying the forward-looking statements are reasonable, any such assumption
could prove to be inaccurate and therefore there can be no assurance that the
- 15 -
results contemplated in forward-looking statements will be realized. In
addition, as disclosed elsewhere in this "Risk Factors" section of this
prospectus, there are a number of other risks inherent in our business and
operations, which could cause our operating results to vary markedly and
adversely from prior results or the results contemplated by the forward-looking
statements. Increases in the cost of our products, or in our general or
administrative expenses, or the occurrence of extraordinary events, could cause
actual results to vary materially from the results contemplated by these
forward-looking statements.
With the exception of fixed costs, the amount spent by the Company for any
specific purpose may vary and will depend on a number of factors. Fixed costs
consist of the fees associated with this offering. Management decisions,
relating to non-fixed costs, such as product development, sales and marketing,
and administrative costs may vary, they are subjective in many respects and
subject to periodic revisions in order to reflect actual business conditions and
developments. The impact of such conditions and developments could lead us to
alter our marketing, capital investment or other expenditures and may adversely
affect the results of our operations. In light of the significant uncertainties
inherent in the forward-looking information included in this prospectus, the
inclusion of such information should not be regarded as a representation by us
or any other person that our objectives or plans will be achieved.
USE OF PROCEEDS
Our offering is being made on a self-underwritten basis: no minimum number of
shares must be sold in order for the offering to proceed. The offering price per
share is $0.01. The following table sets forth the uses of proceeds assuming the
sale of 25%, 50%, 75% and 100%, respectively, of the securities offered for sale
by the Company.
USE OF PROCEEDS TABLE
IF 25% OF IF 50% OF IF 75% OF IF 100% OF
SHARES SOLD SHARES SOLD SHARES SOLD SHARES SOLD
----------- ----------- ----------- -----------
GROSS PROCEEDS FROM THIS OFFERING $ 7,500 $ 15,000 $ 22,500 $ 30,000
LESS: OFFERING EXPENSES =========== =========== =========== ===========
Accounting fees 2,000 2,000 2,000 2,000
Legal fees 1,500 1,500 1,500 1,500
Printing 300 300 300 300
Transfer Agent 1,200 1,200 1,200 1,200
TOTAL $ 5,000 $ 5,000 $ 5,000 $ 5,000
LESS: PRODUCT DEVELOPMENT $ 1,250 $ 6,000 $ 10,250 $ 15,000
LESS: SALES & MARKETING $ 750 $ 3,000 $ 5,250 $ 7,000
Website/Hosting/Online advertising:
LESS: ADMINISTRATION EXPENSES $ 500 $ 1,000 $ 2,000 $ 3,000
Office supplies, Stationary,
Telephone, Internet
=========== =========== =========== ===========
TOTALS $ 7,500 $ 15,000 $ 22,500 $ 30,000
- 16 -
DETERMINATION OF OFFERING PRICE
As there is no established public market for our shares, the offering price and
other terms and conditions relative to our shares have been arbitrarily
determined by KGDC and do not bear any relationship to assets, earnings, book
value, or any other objective criteria of value. In addition, no investment
banker, appraiser, or other independent third party has been consulted
concerning the offering price for the shares or the fairness of the offering
price used for the shares.
DILUTION OF THE PRICE YOU PAY FOR YOUR SHARES
The price of the current offering is fixed at $0.01 per share. This price is
significantly greater than the price paid by the Company's sole officer and
director for common equity since the Company's inception on January 16, 2009.
The Company's sole officer and director paid $ 0.00067 per share, a difference
of $0.00933 per share lower than the share price in this offering.
Dilution represents the difference between the offering price and the net
tangible book value per share immediately after completion of this offering. Net
tangible book value is the amount that results from subtracting total
liabilities and intangible assets from total assets. Dilution arises mainly as a
result of our arbitrary determination of the offering price of the shares being
offered. Dilution of the value of the shares you purchase is also a result of
the lower book value of the shares held by our existing stockholders. The
following tables compare the differences of your investment in our shares with
the investment of our existing stockholders.
Existing Stockholders if all of the Shares are Sold
---------------------------------------------------
Price per share ............................................... $ 0.01
Net tangible book value per share before offering ............. $ 0.0006
Potential gain to existing shareholders ....................... $ 30,000
Net tangible book value per share after offering .............. $ 0.0033
Increase to present stockholders in net tangible book value per
share after offering ........................................ $ 0.0023
Capital contributions ......................................... $ 30,000
Capital contribution by officer & director in January 2009..... $ 6,000
Number of shares outstanding before the offering .............. 9,000,000
Number of shares after offering held by existing stockholders . 9,000,000
Percentage of ownership after offering ........................ 75.0%
Purchasers of Shares in this Offering if all Shares Sold
--------------------------------------------------------
Price per share ............................................... $ 0.01
Net tangible book value per share after distribution........... $ 0.0033
Dilution per share ............................................ $ 0.0067
Capital contributions ......................................... $ 30,000
Percentage of capital contributions ........................... 83.3%
Number of shares after offering held by public investors ...... 3,000,000
Percentage of ownership after offering ........................ 25.0%
Purchasers of Shares in this Offering if 75% of Shares Sold
-----------------------------------------------------------
Price per share ............................................... $ 0.01
Net tangible book value per share after distribution........... $ 0.0025
Dilution per share ............................................ $ 0.0072
Capital contributions ......................................... $ 22,500
Percentage of capital contributions ........................... 78.9%
Number of shares after offering held by public investors ...... 2,250,000
Percentage of ownership after offering ........................ 18.75%
- 17 -
Purchasers of Shares in this Offering if 50% of Shares Sold
-----------------------------------------------------------
Price per share ............................................... $ 0.01
Net tangible book value per share after distribution........... $ 0.0020
Dilution per share ............................................ $ 0.0079
Capital contributions ......................................... $ 15,000
Percentage of capital contributions ........................... 71.4%
Number of shares after offering held by public investors ...... 1,500,000
Percentage of ownership after offering ........................ 12.5%
Purchasers of Shares in this Offering if 25% of Shares Sold
-----------------------------------------------------------
Price per share ............................................... $ 0.01
Net tangible book value per share after distribution........... $ 0.0014
Dilution per share ............................................ $ 0.0083
Capital contributions ......................................... $ 7,500
Percentage of capital contributions ........................... 55.5%
Number of shares after offering held by public investors ...... 750,000
Percentage of ownership after offering ........................ 5.8%
THE OFFERING BY THE COMPANY
KIDS GERM DEFENSE CORP. is registering 3,000,000 shares of its common stock for
offer and sale.
There is currently no active trading market for our common stock, and such a
market may not develop or be sustained. We currently plan to have our common
stock listing on the OTC Bulletin Board, subject to the effectiveness of this
Registration Statement. In addition, a market maker will be required to file a
Form 211 with the Financial Industry Regulatory Authority (FINRA) before the
market maker will be able to make a market in our shares of common stock. At the
date hereof, the Company is not aware that any market maker has any such
intention.
The Company may not sell the shares registered herein until the registration
statement filed with the Securities and Exchange Commission is effective.
Further, The Company will not offer the shares through a broker-dealer or anyone
affiliated with a broker-dealer. Upon effectiveness, all of the shares being
registered herein are may become tradable. The stock may be traded or listed
only to the extent that there is interest by broker-dealers in acting as a
market maker in the Company's stock. Despite the Company's best efforts, it may
not be able to convince any broker/dealers to act as market-makers and make
quotations on the OTC Bulletin Board. The Company may consider pursuing a
listing on the OTCBB after this registration becomes effective and the Company
has completed its offering.
NOTE: In January 2009, the Company issued 9,000,000 shares to Mark Nicholas, the
Company's founder, in exchange for cash of $6,000. These shares were sold in
reliance on the exemption from registration pursuant to Section 4(2). As of the
date of this prospectus, Mr. Nicholas, owns 9,000,000 common shares, which are
subject to Rule 144 restrictions. There is currently one (1) shareholder of our
common stock.
The Company is hereby registering 3,000,000 common shares. The price per share
is $0.01 and will remain so even if the Company obtains a listing on any
exchange or is quoted on the Over-The-Counter (OTC) Bulletin Board, the offering
price of $0.01 will not change for the duration of the offering.
The Company will receive all of the proceeds from such sales of securities and
is bearing all expenses in connection with the registration of the shares of the
Company.
- 18 -
PLAN OF DISTRIBUTION
The Company is offering the shares on a "self-underwritten" basis directly
through Mark Nicholas our Chief Executive Officer and Director named herein. Mr.
Nicholas will not receive any commissions or other remuneration of any kind in
connection with his participation in this offering based either directly or
indirectly on transactions in securities.
This offering is a self-underwritten offering, which means that it does not
involve the participation of an underwriter to market, distribute or sell the
shares offered under this prospectus. This offering will terminate upon the
earlier to occur of (i) 90 days after this registration statement becomes
effective with the Securities and Exchange Commission, (ii) the date on which
all 3,000,000 shares registered hereunder have been sold. The Company may at its
discretion extend the offering for an additional 90 days.
In connection with his selling efforts in the offering, Mr. Nicholas will not
register as a broker or dealer pursuant to Section 15 of the Exchange Act, but
rather will rely upon the "safe harbor" provisions of Rule 3a4-1 under the
Exchange Act. Generally speaking, Rule 3a4-1 provides an exemption from the
broker-dealer registration requirements of the Exchange Act for persons
associated with an issuer that participates in an offering of the issuer's
securities. Mr. Nicholas is not subject to any statutory disqualification, as
that term is defined in Section 3(a)(39) of the Exchange Act. Mr. Nicholas will
not be compensated in connection with his participation in the offering by the
payment of commissions or other remuneration based either directly or indirectly
on transactions in our securities. Mr. Nicholas is not and has not been within
the past 12 months, a broker or dealer, and has not within the past 12 months,
an associated person of a broker or dealer. At the end of the offering, Mr.
Nicholas will continue to primarily perform substantial duties for the Company
or on the Company's behalf otherwise than in connection with transactions in
securities. Mr. Nicholas has not participated in selling an offering of
securities for any issuer more than once every 12 months other than in reliance
on Exchange Act Rule 3a4-1(a)(4)(i) or (iii).
9,000,000 common shares are issued and outstanding as of the date of this
prospectus. The Company is registering 3,000,000 shares of its common stock for
possible sale at the price of $0.01 per share. There is no arrangement to
address the possible effect of the offerings on the price of the stock.
KGDC will receive all proceeds from the sale of the shares by the Company. The
price per share is $0.01 and will remain so for the duration of the offering
Further, the Company will not offer their shares for sale through underwriters,
dealers, or agents or anyone who may receive compensation in the form of
underwriting discounts, concessions or commissions from the Company and/or the
purchasers of the shares for whom they may act as agents.
If applicable, the shares may not be offered or sold in certain jurisdictions
unless they are registered or otherwise comply with the applicable securities
laws of such jurisdictions by exemption, qualification or otherwise. The Company
intends to sell the shares only in the states in which this offering has been
qualified or an exemption from the registration requirements is available, and
purchases of shares may be made only in those states.
- 19 -
In addition and without limiting the foregoing, the Company will be subject to
applicable provisions, rules and regulations under the Exchange Act with regard
to security transactions during the period of time when this Registration
Statement is effective.
The Company will pay all expenses incidental to the registration of the shares,
including if applicable, the registration pursuant to the securities laws of
certain states.
LEGAL PROCEEDINGS
There are no legal actions pending against the Company nor any legal actions
contemplated by the Company at this time.
BUSINESS
KIDS GERM DEFENSE CORP. is a development stage company and was incorporated in
The State of Florida on January 16, 2009, for the purpose of bringing Germ
Defense products to the infant, toddler and juvenile retail market. The
Company's activities have been limited to developing its business and marketing
plan, and the Company has not had any operations or generated any revenues to
date.
These intended products are to promote children's health and hygiene. The
products are intended to be sold to Mass Merchants, Independents and E-Commerce
Retailers through out the United States and to the ultimate consumer. The
Company intends to grow the use of its products to improve and protect the
health of children nationwide. Our products are intended to be uniquely designed
and/or positioned. The products intended are to keep babies, toddlers and
juveniles clean and help defend against illnesses from micro-organisms found on
public and private surfaces. The products are anticipated to be unique and or
national-brand equivalents private-labeled and distributed under the Kids Germ
Defense Corp. label. The intended package design will be developed to evoke an
emotional experience for the parent along with a Program of products for the
retailer that will hopefully unify a fragmented market.
According to the Centers for Disease Control, many illnesses are spread by
touch. (Centers for Disease Control: Infection Disease Prevention.
http://www.cdc.gov/HealthyHomes/ByTopic/InfectiousDisease.html) The Company's
intent is to reduce childhood illnesses through the development and sale of our
intended product line. We believe in maintaining good hygiene. For the same
reasons that we and our children wear seat belts, put on helmets, and use car
seats for kids, the Company intends to advocate personal Germ Defense strategies
and provide products to help maintain healthful hygiene.
The Germ Defense products the Company intends to develop and launch will be for
home and on-the-go needs. Products such as: Germ Proof Disposable High Chair and
Table Placemats, Changing Table Disposable and Re-usable Covers, Public Potty
Protectors, Shopping Cart Germ Proof Disposable and Re-usable Covers,
Antibacterial Towelettes, Kids Books directed towards the Germs making them ill
and the recommendations, and other intended products related to germs associated
with touch, feel, breathing, playing and the environment indoors and outdoors.
These are just a few of the planned Germ Defense product line offering. The
company intends to expand the product line upon the success of the initial
product launch.
- 20 -
The Company will not have the necessary capital to develop our Business Plan
until the Company is able to secure financing. There can be no assurance that
such financing will be available on suitable terms. See "Managements Discussion
and Analysis Plan of Operations" and "Liquidity and Capital Resources."
The Company has no plans to change our business activities or to combine with
another business and are not aware of any events or circumstances that might
cause us to change our plans. The Company has no revenues, have achieved losses
since inception, have no operations, have been issued a going concern opinion
and rely upon the sale of our securities to funds operations.
The following description of our business is intended to provide an
understanding of our Company and the direction of our strategy.
REGULATORY MATTERS
The Company is unaware of and does not anticipate having to expend significant
resources to comply with any governmental regulations of the germ defense
market. The Company is subject to the laws and regulations of those
jurisdictions in which we plan to sell our product, which are generally
applicable to business operations, such as business licensing requirements,
income taxes and payroll taxes. In general, the development and operation of our
business is not subject to special regulatory and/or supervisory requirements.
If the Company discovers that any of its intended products do need
certifications or are within a governmentally regulated category, the Company
intends to use private label manufactures who's products are certified by the
Original equipment manufacturer (OEM) provider.
The Juvenile Products Manufactures Association (JPMA) has a unique Certification
Program that has been guiding Manufacturers and Parents for more than 21 plus
years. The American Society for Testing Materials (ASTM), a highly regarded
non-profit organization publishes the voluntary standards used in the JPMA
Certification Program. Industry members work together with the U.S. Consumer
Product Safety Commission (CPSC), consumer groups and other interested parties
to develop the standards. The Company intends to develop programs that are
compliant where required, with ASTM, JPMA Certification Standards as well as any
other organization.
STRATEGY AND PRODUCTS
We believe that there is a strong need for an innovative approach to provide
Kids Germ Defense Products. The products to be developed are intended to keep
babies, toddlers and juveniles to help defend against illnesses from
micro-organisms found on private and public surfaces.
Through our intended product line, the Company intends to create real product
solutions that encourage parents in helping to defend against illnesses obtained
from micro-organisms found on some private and public surfaces. The Company
intends that our product packaging and retail displays will be designed to
provide the consumer with the knowledge that these products are proper for their
needs. Further, the Company will check with the Consumer Reports Magazine, the
Centers for Disease Control, and other journals and websites to access safety
news and trends. The Company will check daily product recalls and safety news
from the U.S. Consumer Product Safety Commission and other related agencies, al
accessible through a common website (http://www.recalls.gov), and will react
accordingly. Mr. Nicholas, our CEO, was previously involved in assisting in
developing standards in the Juvenile Industry. Future plans will be to designate
an executive of the Company to be part of this important area.
- 21 -
The Company intends to assemble certain products. However, most of our products
will be designed by the Company and totally assembled and packaged via domestic
and off-shore contractors. The Company intends to inventory all of our products
for distribution in our intended warehouse in the Sarasota County, Florida area.
The Company intends to sell products through a network of non-salaried,
commissioned sales representatives Products will be sold through a number of
distribution channels such as: mass merchant retail chains, independent
retailers, e-commerce retailers and the Kids Germ Defense website.
The Company intends to maintain a website. The KGDC website will (a) provide a
forum for offering educational information for consumers. (b) offer a means of
communication about our products and listing of retailers offering them. (c)
generate revenue via our own e-commerce retail website. The Company has acquired
and registered the domain name kidsgermdefense.com and there has been no other
website development.
Our early stage intended product line will consist of: High Chair and Table
Disposable and re-usable germ proofing placemats, Changing Table disposable and
re-usable covers, disposable and re-usable Public Potty Protectors, disposable
and re-usable Shopping Cart germ proofing covers, Antibacterial towelettes, Kids
book directed towards educating them and parents discussing germs that make them
ill prevention, and other intended products related to germs associated with
touching, feeling, breathing, playing and the environment indoors and outdoors.
Mr. Nicholas, our CEO brings start-up experience, extensive business,
administrative, finance, operations, marketing and implementation skills.
THE MARKET
According to the CDC's National Center for Health Statistics, there are
approximately four (4) million babies born each year in the United States.
(National Vital Statistics Reports, Births, Marriages, Divorces, and Deaths:
Provisional Data for November 2008, v. 57, n.18, p. 1 (July 24, 2009)
http://www.cdc.gov/nchs/products/nvsr.htm)
The Germ Defense Market is a category the Company intends to develop. The
industry is fragmented. The Market is comprised of a number of major and minor
companies that provide products that are likely to be connected to our intended
product line. Most of our product line is intended to be an accessory to these
products.
The Company's intention is to develop accessories for the products of other
manufacturers in this industry. The Company's "accessories" will make up a new
category called "Kids Germ Defense".
o With approximately four million babies born in the United States each
year, our products will be initially designed for parents of children ages
0 to 3 years old, estimated at twelve million parent customers in the
United States. After the initial launch our products, the Company intends
to expand its products to include the parents of children ages 4 to 10.
The company estimates the total market can increase to forty million
parents for the entire age group 0 to 10 years old.
o The Hand Sanitizer Sales have grown in double digits since 2003. Through
2006, sales in only supermarkets and drug stores alone were up 14.4% from
2005 to $70.0 million. That growth built on a huge 53.3% rise in 2005.
(Per A C Nielsen, USA TODAY January 3, 2007).
- 22 -
It is the Company's belief, based on the approximate number of babies born each
year, the growth in hand sanitizer sales, and our experience, that Kids Germ
Defense is an emerging market that we intend to develop.
MANAGEMENT
The Company intends to employ and use consultants to build the corporate
infrastructure in FINANCE, ACCOUNTING, MARKETING, SALES, SOFTWARE, PURCHASING
and other administrative functions. There are no consultants currently employed
by the Company.
SALES AND MARKETING
The distribution channels for our products are highly competitive. The Company
intends to build distribution channels in phases. Phase one, the company intends
to use to utilize our anticipated website (www.kidsgermdefense.com) to generate
sales and begin to build a brand for "Kids Germ Defense Products". Phase two,
the Company intends to market to on-line infant, juvenile e-commerce retailers
as well as drug stores, food retailers and other mass market retailers that have
a significant online e-commerce presence. Phase three, the Company intends to
build traditional retail distribution through retailers such as CVS, Walgreens,
Publix, Babies R Us, Target, Wal-Mart and other smaller specialty retailers.
The Company intends to employ a salaried Vice President of Marketing & Sales
whose responsibility will be to execute the Marketing and Sales Plan. The
Company intends to develop a non-salaried, commission only sales representative
organization responsible to handle specialized retailers such as food, drug,
independents and e-commerce retailers.
SHOWS AND ADVERTISING
The Company intends to market and exhibit its products at tradeshows, including
(a) Food and Drug shows (b) the ABC Juvenile (c) Merchandising shows, and other
related retailer shows. In addition, the Company intends to advertise in
Retailer Trade Journals, through our website and from consumer magazines.
COMPETITION
Almost all of our competitors and potential competitors presently have
considerably greater financial resources and experience in market penetration
than the Company has. These companies include mass market retailers that develop
private label products, consumer product companies, and other germ defense
manufacturers. Some of the our potential competitors include Purell, Johnson &
Johnson, Dial, GoJo Industries, Steris Corp., and 3M. The online commerce market
is rapidly evolving and also intensely competitive. Because barriers to entry
are low and current and new competitors can launch new web sites at a relatively
low cost, this could further fragment our market and make it more difficult to
reach our customers.
- 23 -
Management believes that the Company will be able to distinguish the KGDC line
of products by developing a complete product category of KIDS GERM DEFENSE
products. This category will include existing products from other manufacturers
and new innovative products developed by KGDC. Until the business and marketing
plan are completed, we are not able to confirm with certainty any legal steps
required in developing new products or integrating the products of other
company's into its line of products. The company is unaware of any legal issues
surrounding property rights, including intellectual property pertaining to the
manufacture, use and distribution of existing products by the producers of those
products for the Company.
The Company believes that creating a "Kids Germ Defense" brand as well as being
one of the first companies to development and market Germ Defense Products
specifically for children will afford the Company a competitive advantage.
Further, the company's principal methods of competition will include providing a
broad range of products at a reasonable price, with a high degree of
effectiveness and reliability; the ability to introduce new products; the
ability to reduce costs; return on investment for our customers; and the ability
to integrate our retail merchandising with our customer's merchandising systems.
The Company will merchandise its concept both online and in retails stores using
a retail merchandising concept. This concept will enable the Company to
communicate the brand values through direct interaction with the consumers by
bringing the company's products, and the germ defense products of other
companies together. This line of products will be integrated into a retail
merchandising system, which the Company intends to deliver to retailers as part
of its marketing and sales package using a concept of merchandising known as a
"Planogram". A Planogram is a diagram of fixtures and products that illustrate
how and where retail products should be displayed.
While there are many competitors in this industry, the industry appears to be
fragmented and KGDC believes the opportunity exists by consolidating these
products under one brand name "KIDS GERM DEFENSE".
STAFFING
As of June 30, 2009, KGDC has no permanent staff other than its sole officer and
director, Mark Nicholas, who is the President and Chairman of the Company. Mr.
Nicholas has the flexibility to work on KGDC up to 10 to 25 hours per week. He
is prepared to devote more time to our operations as may be required. He is not
being paid at present.
EMPLOYEES AND EMPLOYMENT AGREEMENTS
At present, KGDC has no employees other than its current sole officer and
director, Mr. Nicholas, who has not been compensated. There are no employment
agreements in existence. The Company presently does not have, pension, health,
annuity, insurance, stock options, profit sharing, or similar benefit plans;
however, the Company may adopt plans in the future. There are presently no
personal benefits available to the Company's director.
During the initial implementation of our marketing strategy, the Company intends
to hire independent consultants to develop and execute its marketing plan which
includes the design, development, and maintenance of a website. We plan on
hiring a V.P. of Marketing/Sales to execute the Marketing and Sales Plan.
- 24 -
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This section of the prospectus includes a number of forward-looking statements
that reflect our current views with respect to future events and financial
performance. Forward-looking statements are often identified by words like:
"believe", "expect", "estimate", "anticipate", "intend", "project" and similar
expressions, or words that, by their nature, refer to future events. You should
not place undue certainty on these forward-looking statements, which apply only
as of the date of this prospectus. These forward-looking statements are subject
to certain risks and uncertainties that could cause actual results to differ
materially from historical results or our predictions.
The Company is a development stage company, intending to establish itself as a
Manufacturing, Wholesaling, Marketing and Sales Company specializing in a
program of Kids Germ Defense Products for children from Birth to 3 years old.
The Company has not yet generated or realized any revenues from business
operations. Our auditors have issued a going concerned opinion. This means there
is substantial doubt that we can continue as an on-going business for the next
twelve (12) months unless we obtain additional capital to pay our bills. This is
because the Company has not generated any revenues and no revenues are
anticipated until we begin marketing our products to customers. Accordingly, we
must raise cash from sources other than revenues generated from the proceeds of
loans we undertake.
The Company plans to market and sell a line of products to initially consist of:
re-usable germ proofing placemats for highchairs and tables, changing table
covers, public potty protectors, shopping cart germ proofing covers,
antibacterial towelettes for children, a book directed towards educating
children and parents about germs, germ prevention and illness prevention, and
other products related to germs defense associated with touching, feeling,
breathing, playing and the environment indoors and outdoors.
From inception to June 30, 2009, the Company's business operations have
primarily been focused on developing our business plan and market research. The
company has spent a total of $7,790 on start-up costs. The Company has not
generated any revenue from business operations. All proceeds currently held by
the Company are the result of the sale of common stock to its officer.
As of June 30, 2009 the Company incurred expenditures of $2,000 for accounting
Services, the preparation of audited financial statements, and $1,500 for legal
services. The Company had expenditures of $3,000 for general administrative
costs. The Company spent $1,290 for preliminary market research.
The proceeds from this offering will satisfy the company's cash requirements for
5 to 6 months. If the company is unable to raise additional monies, the company
only has enough capital to cover the costs of this offering and to formulate the
business and marketing plan. The expenses of this offering include the
preparation of this prospectus, the filing of this registration statement.
Formulating the business and marketing plan includes researching suppliers,
products, and manufacturing.
The Company had cash of $210 as of June 30, 2009. We believe we do not have
adequate funds to satisfy our working capital requirements for the next twelve
months. The Company will need to raise additional capital to continue our
operations. During the 12 months following the completion of this offering, the
Company intends to implementation of its business and marketing plan and must
raise additional capital in the amount of $130,000 to effectively execute the
plan.
- 25 -
We expect to complete this step, within 6 months of the completion of this
offering. During months 7 to 12 the Company will begin to implement its business
and marketing plan.
The company intends to raise additional capital in two phases. Phase one will
require additional funding of $130,000 to begin implementing the business plan,
completing the prototype plans, and identifying the necessary resources to
implement our plan, over the 6 to 12 months.
Phase two will require additional funding of $270,000 to execute the Company's
sales and marketing strategy.
Until the business and marketing plan are completed, we are not able to quantify
with any certainty a more detailed plan of steps the Company will take to raise
required additional capital in phase one ($130,000) and phase two ($270,000).
The timeline for raising capital will be based on our success of raising
additional capital over the next 12 months.
The Company anticipates 12 to 18 months of operational losses at approximately
$6,750.00 per month before we can generate adequate cash flow to cover
operations. As of June 30, 2009, the Company had cash on hand of $210 .
PHASE 1 - STEPS REQUIRED FOR IMPLEMENTING "BUSINESS PLAN"
ESTIMATED BUDGET
----------------
Business Plan Development/Travel ............................ $ 15,000
Product Prototype Development ............................... 15,000
Product Prototype Packaging and Displays/Focus Group ........ 30,000
Web Design/Hosting .......................................... 20,000
Professional Fees ........................................... 20,000
Misc. (Insurance, Other contingencies) ...................... 30,000
TOTAL ..... $130,000
* Note: This table above does not include costs related to commencing sales and
marketing of Company's products.
We anticipate fixed monthly costs of between $2,000 to $4,000.
In the event that we experience a shortfall in our capital, which will occur if
the Company is unable to begin to generate revenues, the Company intends to
pursue capital through public or private financing as well as borrowings and
other sources, such as our officer and director. We cannot guarantee that
additional funding will be available on favorable terms, if at all. If adequate
funds are not available, then our ability to continue our operations may be
significantly hindered.
In order to effectuate the development of our product line the Company has and
continues to conduct significant market research including; Online and offline
product and market research regarding food and drug, mass merchant retailers
review of the Center for Disease Control (CDC) publications and others, directed
towards methods to assist in the prevention of the spread of micro-organisms
triggering new product development, visiting local hospitals and healthcare
facilities to research and investigate new product needs, visiting merchandising
managers, buyers of food and drug, and mass merchants to determine future needs,
perform focus group testing of prototype products and determine other consumer
wish list products.
*The Company has not yet begun the development of any products.
- 26 -
Management does not plan to hire additional employees at this time. Our sole
officer and director will be responsible for the initial servicing. Once the
Company begins sales, marketing and distribution of its products, the Company
intends to hire independent consultants and sales representatives as the Company
deems necessary.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURES
On August 6, 2009, KGDC dismissed Moore & Associates Chartered, its independent
registered public account firm, when Moore informed the Company that Moore would
no longer be engaged in auditing or reviewing public company financial
statements. Please note that the Public Company Accounting Oversight Board
("PCAOB") revoked the registration of Moore because of violations of PCAOB rules
and auditing standards in auditing the financial statements, PCAOB rules and
quality controls standards, and Section 10(b) of the Securities Exchange Act of
1934 and Rule 10b-5 thereunder, and noncooperation with a Board investigation.
On the same date, August 6, 2009, the accounting firm of Seale and Beers, CPAs
was engaged as KGDC's new independent registered public account firm. KGDC
approved of the dismissal of Moore & Associates Chartered and the engagement of
Seale and Beers, CPAs as its independent auditor. None of the reports of Moore &
Associates Chartered on the KGDC's financial statements for the period from
inception, January 16, 2009, to March 31, 2009, or subsequent interim period,
contained an adverse opinion or disclaimer of opinion, or was qualified or
modified as to uncertainty, audit scope or accounting principles, except that
KGDC's audited financial statements contained in its Form S-1/A, dated June 18,
2009, for the fiscal year ended March 31, 2009, a going concern qualification in
the KGDC's audited financial statements.
During the period from inception, January 16, 2009 to March 31, 2009, there were
no disagreements with Moore and Associates, Chartered whether or not resolved,
on any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which, if not resolved to Moore and
Associates, Chartered's satisfaction, would have caused it to make reference to
the subject matter of the disagreement in connection with its report on KGDC's
financial statements, nor were there any up to and including the time of
dismissal on August 6, 2009.
Seale and Beers, conducted a full audit of the accompanying balance sheet of
KGDC as of March 31, 2009, and the related statements of operations,
stockholders' equity (deficit) and cash flows for the period from inception on
January 16, 2009 through March 31, 2009 and a review of the accompanying balance
sheet of KGDC as of June 30, 2009, and the related statements of operations and
cash flows for the Company's second fiscal quarter ending June 30, 2009.
LIMITED OPERATING HISTORY; NEED FOR ADDITIONAL CAPITAL
There is no historical financial information about us upon which to base an
evaluation of our performance. KGDC was incorporated in the State of Florida in,
Jan. 16, 2009; the Company is a development stage company attempting to
establish itself as a Manufacturing, Wholesaling, Marketing and Sales Company
specializing Germ Defense products for children from 0-3 and eventually 0-10
years of age. We intend to develop, market and sell through retail distribution
channels (mass merchant retail chains, independent retailers and e-commerce
retailers) a line of Germ Defense products throughout the United States.
Emphasis will be placed on the following types of Germ Defense products for home
and for on-the-go. High Chair and Table Placemats(disposable and reusable)
Changing Table Covers (disposable and reusable), Public Potty Protectors
(disposable and reusable), Shopping Cart Covers (disposable and reusable) and
other products related to Germs associated with touching, feeling, breathing,
playing and the environment both indoors and outdoors. These are just a few of
the intended Germ Defense product line offerings.
- 27 -
The Company's mission is to expand the use of Kids Germ Defense products to
improve and protect the health of kids nationwide.
The Company has not generated any revenues from our operations. We cannot
guarantee we will be successful in our business operations. Our business is
subject to risks inherent in the establishment of a new business enterprise,
including the financial risks associated with the limited capital resources
currently available to us for the implementation of our business strategies.
(See "Risk Factors"). To become profitable and competitive, we must develop the
business and marketing plan and execute the plan.
Our sole officer and director Mark Nicholas, undertakes to provide us with
initial operating and loan capital to sustain our business plan over the next
twelve (12) month period. In addition, Mr. Nicholas will seek alternative
financing through means such as borrowings from institutions or private
individuals.
Since inception January 16,2009 to June 30, 2009, KGDC has spent a total of
$7,790 on start-up costs. The Company has not generated any revenue from
business operations. All proceeds currently held by the Company are the result
of the sale of common stock to its officers.
As of June 30, 2009 the Company incurred expenditures of $2,000 for accounting
services, the preparation of audited financial statements, and $1,500 for legal
services. The Company had expenditures of $3,000 for general administrative
costs. The Company spent $1,290 for preliminary market research.
Since inception, the majority of the Company's time has been spent refining its
business plan and marketing, conducting industry research, and preparing for a
primary financial offering.
LIQUIDITY AND CAPITAL RESOURCES
As of the date of this registration statement, the Company has yet to generate
any revenues from our business operations. For the period ended June 30, 2009,
KGDC issued 9,000,000 shares of common stock to our sole officer and director
for cash proceeds of $0.000666 per share.
We anticipate needing a minimum of $130,000 in order to effectively execute our
business plan over the next twelve months. The available cash is not sufficient
to allow us to commence full execution of our business plan. Our business
expansion will require significant capital resources that may be funded through
the issuance of common stock or of notes payable or other debt arrangements that
may affect our debt structure. Despite our current financial status we believe
that the Company may be able to issue notes payable or debt instruments in order
to start executing our Business and Marketing Plan.
Through June 30, 2009, the Company has spent a total of $7,790 in general
operating expenses. We raised the cash amounts used in these activities from our
officer.
As of June 30, 2009 the Company had $210 cash in hand.
To date, the Company has managed to keep our monthly cash flow requirement low
for two reasons. First, our sole officer has agreed not to draw a salary until a
minimum of $250,000 in funding is obtained or until the Company has achieved
$500,000 in gross revenues. Second, the Company has been able to keep our
operating expenses to a minimum by operating in space owned by our sole officer
and are only paying the direct expenses associated with our business operations.
- 28 -
As of the date of this registration statement, the current funds available to
the Company will not be sufficient to continue maintaining a reporting status.
The Company's sole officer and director undertakes to provide us with funds
required to maintain the reporting status in the form of a loan for the next
twelve months as the expenses are incurred if no other proceeds are obtained by
the Company. However, there is no contract in place or written agreement
securing this agreement. Management believes if the Company cannot maintain its
reporting status with the SEC it will have to cease all efforts directed towards
the Company. As such, any investment previously made would be lost in its
entirety.
The company currently has no external sources of liquidity such as arrangements
with credit institutions or off-balance sheet arrangements that will have or are
reasonably likely to have a current or future effect on our financial condition
or immediate access to capital, except for the undertakings as discussed
previously by our sole officer and director Mark Nicholas.
If the Company is unable to raise the funds partially through this offering the
Company will seek alternative financing through means such as borrowings from
institutions or private individuals. There can be no assurance that the Company
will be able to keep costs from being more than these estimated amounts or that
the Company will be able to raise such funds. Even if we sell all shares offered
through this registration statement, we expect that the Company will seek
additional financing in the future. However, the Company may not be able to
obtain additional capital or generate sufficient revenues to fund our
operations. If we are unsuccessful at raising sufficient funds, for whatever
reason, to fund our operations, the Company may be forced to seek a buyer for
our business or another entity with which we could create a joint venture. If
all of these alternatives fail, we expect that the Company will be required to
seek protection from creditors under applicable bankruptcy laws.
Our independent auditor has expressed substantial doubt about our ability to
continue as a going concern and believes that our ability is dependent on our
ability to implement our business plan, raise capital and generate revenues. See
Note 6 of our financial statements.
Recent Federal legislation, including the Sarbanes-Oxley Act of 2002, has
resulted in the adoption of various corporate governance measures designed to
promote the integrity of the corporate management and the securities markets.
Some of these measures have been adopted in response to legal requirements.
Others have been adopted by companies in response to the requirements of
national securities exchanges, such as the NYSE or The NASDAQ Stock Market, on
which their securities are listed. Among the corporate governance measures that
are required under the rules of national securities exchanges are those that
address board of directors' independence, audit committee oversight, and the
adoption of a code of ethics. Our Board of Directors is comprised of one
individual who is also our executive officer. Our executive officer make
decisions on all significant corporate matters such as the approval of terms of
the compensation of our executive officer and the oversight of the accounting
functions.
Although the Company has adopted a Code of Ethics and Business Conduct the
Company has not yet adopted any of these other corporate governance measures
and, since our securities are not yet listed on a national securities exchange,
the Company is not required to do so. The Company has not adopted corporate
governance measures such as an audit or other independent committees of our
board of directors as we presently do not have any independent directors. If we
expand our board membership in future periods to include additional independent
directors, the Company may seek to establish an audit and other committees of
- 29 -
our board of directors. It is possible that if our Board of Directors included
independent directors and if we were to adopt some or all of these corporate
governance measures, stockholders would benefit from somewhat greater assurances
that internal corporate decisions were being made by disinterested directors and
that policies had been implemented to define responsible conduct. For example,
in the absence of audit, nominating and compensation committees comprised of at
least a majority of independent directors, decisions concerning matters such as
compensation packages to our senior officers and recommendations for director
nominees may be made by a majority of directors who have an interest in the
outcome of the matters being decided. Prospective investors should bear in mind
our current lack of corporate governance measures in formulating their
investment decisions.
CODE OF BUSINESS CONDUCT AND ETHICS
In January 16,2009 we adopted a Code of Ethics and Business Conduct which is
applicable to our employees and which also includes a Code of Ethics for our CEO
and principal financial officers and persons performing similar functions. A
code of ethics is a written standard designed to deter wrongdoing and to promote
o honest and ethical conduct,
o full, fair, accurate, timely and understandable disclosure in regulatory
filings and public statements,
o compliance with applicable laws, rules and regulations,
o the prompt reporting violation of the code, and
o accountability for adherence to the code.
A copy of our Code of Business Conduct and Ethics has been filed with the
Securities and Exchange Commission as an exhibit to our S-1 filing. Any person
desiring a copy of the Code of Business Conduct and Ethics, can obtain one by
going to Edgar and looking at the attachments to our S-1
MANAGEMENT
Background of Officers and Directors
Our sole officer and director will serve until his successor is elected and
qualified. Our officers are elected by the board of directors to a term of one
(1) year and serve until their successor is duly elected and qualified, or until
they are removed from office. The board of directors has no nominating, auditing
or compensation committees.
The name, address, age and position of our president, secretary/treasurer, and
director and vice president is set forth below:
Name and Address Age Position(s)
---------------- --- -----------
Mark Nicholas 40 President, Secretary/ Treasurer
6279 Buckingham St Principal Executive Officer
Sarasota, FL 34238 Principal Financial Officer and sole member of
the Board of Directors
The person named above has held his offices/positions since the inception of our
company and is expected to hold his offices/positions until the next annual
meeting of our stockholders.
- 30 -
BUSINESS EXPERIENCE
MARK NICHOLAS, PRESIDENT, CEO, DIRECTOR, SECRETARY/TREASURER
Mr. Nicholas is the founder of KGDC and has served since inception.
2001 to Present, Department Finance Manager, City of Sarasota, Florida, Public
Works Department Responsible for the maintenance and accuracy of detailed
financial records for the Public Works Department of the City of Sarasota,
Florida. Oversee $40 million dollar annual budget, set and develop utility
rates, manage the implementation of software programs to alert customers of
outages and disruption of service.
1989-2001, Vice President of Operations and COO Diplomat Juvenile Corporation,
Stony Point, New York and Sarasota, Florida. Mr. Nicholas was responsible for
directing the operations (manufacturing, Purchasing and Fulfillment) of the
Corporations 300 infant and juvenile products to mass merchants ( Wal-Mart,
Target, Sears, Toys R Us, Babies R Us, Walgreens, CVS, Publix, and
Independents). Responsible for over 300 employees
Education: B.A. Business Management Eckerd College St. Petersburg, Florida
Graduated with Honors
Affiliations: Past Member of the JPMA (Juvenile Products Manufacturers Assoc.)
Member of National Institute of Governmental Purchasing (NIGP)
Member of Florida Association of Public Purchasing Officers(FAPPO)
Member of Florida Government Finance Officers Association (FGFOA)
Mr. Nicholas is not an officer or director of any reporting company and there
have been no related party transactions.
CONFLICTS OF INTEREST
At the present time, the Company does not foresee a direct conflict of interest
with our sole officer and director. The only conflict that we foresee is Mr.
Nicholas's devotion of time to projects that do not involve us. In the event
that Mr. Nicholas ceases devoting time to our operations, he has agreed to
resign as an officer and director.
COMMITTEES OF THE BOARD OF DIRECTORS
Our Board of Directors has not established any committees, including an Audit
Committee, a Compensation Committee or a Nominating Committee, any committee
performing a similar function. The functions of those committees are being
undertaken by the entire board as a whole. Because the Company does not have any
independent directors, our Board of Directors believes that the establishment of
committees of the Board would not provide any benefits to our company and could
be considered more form than substance.
The Company does not have a policy regarding the consideration of any director
candidates that may be recommended by our stockholders, including the minimum
qualifications for director candidates, nor has our Board of Directors
established a process for identifying and evaluating director nominees. The
Company has not adopted a policy regarding the handling of any potential
recommendation of director candidates by our stockholders, including the
procedures to be followed. Our Board has not considered or adopted any of these
policies as we have never received a recommendation from any stockholder for any
candidate to serve on our Board of Directors. Given our relative size and lack
of directors and officers insurance coverage, the Company does not anticipate
- 31 -
that any of our stockholders will make such a recommendation in the near future.
While there have been no nominations of additional directors proposed, in the
event such a proposal is made, all members of our Board will participate in the
consideration of director nominees.
None of our directors is an "audit committee financial expert" within the
meaning of Item 401(e) of Regulation S-1. In general, an "audit committee
financial expert" is an individual member of the audit committee or Board of
Directors who:
o understands generally accepted accounting principles and financial
statements,
o is able to assess the general application of such principles in connection
with accounting for estimates, accruals and reserves,
o has experience preparing, auditing, analyzing or evaluating financial
statements comparable to the breadth and complexity to our financial
statements,
o understands internal controls over financial reporting, and
o understands audit committee functions.
Our Board of Directors is comprised of individuals who were integral to our
formation and who are involved in our day to day operations. While we would
prefer that one or more of our directors be an audit committee financial expert,
none of these individuals who have been key to our development have professional
backgrounds in finance or accounting. As with most small, early stage companies
until such time our company further develops its business, achieves a stronger
revenue base and has sufficient working capital to purchase directors and
officers insurance, the Company does not have any immediate prospects to attract
independent directors. When the Company is able to expand our Board of Directors
to include one or more independent directors, the Company intends to establish
an Audit Committee of our Board of Directors. It is our intention that one or
more of these independent directors will also qualify as an audit committee
financial expert. Our securities are not quoted on an exchange that has
requirements that a majority of our Board members be independent and the Company
is not currently otherwise subject to any law, rule or regulation requiring that
all or any portion of our Board of Directors include "independent" directors,
nor are we required to establish or maintain an Audit Committee or other
committee of our Board of Directors.
THE COMPANY DOES NOT HAVE ANY INDEPENDENT DIRECTORS AND THE COMPANY HAS NOT
VOLUNTARILY IMPLEMENTED VARIOUS CORPORATE GOVERNANCE MEASURES, IN THE ABSENCE OF
WHICH, STOCKHOLDERS MAY HAVE MORE LIMITED PROTECTIONS AGAINST INTERESTED
DIRECTOR TRANSACTIONS, CONFLICTS OF INTEREST AND SIMILAR MATTERS.
EXECUTIVE COMPENSATION
KGDC has made no provisions for paying cash or non-cash compensation to its sole
officer and director. No salaries are being paid at the present time, no
salaries or other compensation were paid in cash, or otherwise, for services
performed prior to January 16, 2009 our date of inception, and no compensation
will be paid unless and until our operations generate sufficient cash flows.
The table below summarizes all compensation awarded to, earned by, or paid to
our named executive officer for all services rendered in all capacities to us
for the period from inception (January 16, 2009) through June 30, 2009.
- 32 -
SUMMARY COMPENSATION TABLE
Name Non-Equity Nonqualified
and Stock Option Incentive Plan Deferred All Other
principal Salary Bonus Awards Awards Compensation Compensation Compensation Total
position Year ($) ($) ($) ($) ($) Earnings ($) ($) ($)
--------- ---- ------ ----- ------ ------ -------------- ------------ ------------ -----
Mark
Nicholas
President 2009 0 0 0 0 0 0 0
We did not pay any salaries in 2009. The Company does not anticipate beginning
to pay salaries until the Company has adequate funds to do so. There are no
other stock option plans, retirement, pension, or profit sharing plans for the
benefit of our officers and director other than as described herein.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
The table below summarizes all unexercised options, stock that has not vested,
and equity incentive plan awards for each named executive officer as of June 30,
2009.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
OPTION AWARDS STOCK AWARDS
-------------------------------------------------------------------- ---------------------------------------
Equity
Incentive
Equity Plan
Market Incentive Awards:
Number Value Plan Market or
of of Awards: Payout
Shares Shares Number of Value of
Equity or or Unearned Unearned
Incentive Plan Units Units Shares, Shares,
Number of Number of Awards: Number of of Units or Units or
Securities Securities of Securities Stock Stock Other Other
Underlying Underlying Underlying That That Rights Rights
Unexercised Unexercised Unexercised Option Have Have That Have That Have
Options Options Unearned Exercise Option Not Not Not Not
(#) (#) Options Price Expiration Vested Vested Vested Vested
Name Exercisable Unexercisable (#) ($) Date (#) ($) (#) (#)
-------- ----------- ------------- -------------- -------- ---------- ------ ------ --------- ---------
Mark - - - - - - - - -
Nicholas
There were no grants of stock options since inception to the date of this
Prospectus.
The Company does not have any long-term incentive plans that provide
compensation intended to serve as incentive for performance.
The Board of Directors of KGDC has not adopted a stock option plan. The Company
has no plans to adopt it but may choose to do so in the future. If such a plan
is adopted, this may be administered by the board or a committee appointed by
the board (the "Committee"). The committee would have the power to modify,
extend or renew outstanding options and to authorize the grant of new options in
substitution therefore, provided that any such action may not impair any rights
under any option previously granted. KGDC may develop an incentive based stock
option plan for its officers and directors and may reserve up to 10% of its
outstanding shares of common stock for that purpose.
- 33 -
STOCK AWARDS PLAN
The Company has not adopted a Stock Awards Plan, but may do so in the future.
The terms of any such plan have not been determined.
DIRECTOR COMPENSATION
The table below summarizes all compensation awarded to, earned by, or paid to
our directors for all services rendered in all capacities to us for the period
from inception (January 16, 2009) through June 30, 2009.
DIRECTOR COMPENSATION
Fees
Earned
or Non-Equity Non-Qualified
Paid Incentive Deferred All
in Stock Option Plan Compensation Other Total
Cash Awards Awards Compensation Earnings Compensation ($)
Name ($) ($) ($) ($) ($) ($)
-------- ------ ------ ------ ------------ ------------- ------------ -----
Mark
Nicholas 0 0 0 0 0 0 0
At this time, KGDC has not entered into any employment agreements with its sole
officer and director. If there is sufficient cash flow available from our future
operations, the Company may enter into employment agreements with our sole
officer and director or future key staff members.
LONG-TERM INCENTIVE PLAN AWARDS
The Company does not have any long-term incentive plans that provide
compensation intended to serve as incentive for performance.
EMPLOYMENT AGREEMENTS
At this time, KGDC has not entered into any employment agreements with our sole
officer and director. If there is sufficient cash flow available from our future
operations, the Company may in the future enter into employment agreements with
our sole officer and director, or future key staff members.
INDEMNIFICATION
Under our Articles of Incorporation and Bylaws of the corporation, the Company
may indemnify an officer or director who is made a party to any proceeding,
including a lawsuit, because of his position, if he acted in good faith and in a
manner he reasonably believed to be in our best interest. The Company may
advance expenses incurred in defending a proceeding. To the extent that the
officer or director is successful on the merits in a proceeding as to which he
is to be indemnified, we must indemnify him against all expenses incurred,
including attorney's fees. With respect to a derivative action, indemnity may be
made only for expenses actually and reasonably incurred in defending the
proceeding, and if the officer or director is judged liable, only by a court
order. The indemnification is intended to be to the fullest extent permitted by
the laws of the State of Florida
- 34 -
Regarding indemnification for liabilities arising under the Securities Act of
1933, which may be permitted to directors or officers under Florida law, the
Company is informed that, in the opinion of the Securities and Exchange
Commission, indemnification is against public policy, as expressed in the Act
and is, therefore, unenforceable.
PRINCIPAL STOCKHOLDERS
The following table sets forth, as of the date of this prospectus, the total
number of shares owned beneficially by our sole officer and director, and key
employees, individually and as a group, and the present owners of 5% or more of
our total outstanding shares. The table also reflects what his ownership will be
assuming completion of the sale of all shares in this offering. The stockholder
listed below has direct ownership of his shares and possesses sole voting and
dispositive power with respect to the shares.
Percentage Percentage Percentage Percentage
of of of of
Amount Ownership Ownership Ownership Ownership
and Assuming Assuming Assuming Assuming
Nature of all of the 75% of the 50% of the 25% of the
Title of Name and Address of Beneficial Percent Shares are Shares are Shares are Shares are
Class Beneficial Owner [1] Ownership of Class Sold Sold Sold Sold
-------- -------------------- ---------- -------- ---------- ---------- ---------- ----------
Common Mark Nicholas 9,000,000 100% 75% 81.3% 87.5% 94.2%
Stock 6279 Buckingham St.
Sarasota, FL 34238
All Officers and 9,000,000 100% 75% 81.3% 87.5% 94.2%
Directors as a Group
(1 person)
_________
[1] The person named above may be deemed to be a "parent" and "promoter" of
our company, within the meaning of such terms under the Securities Act of
1933, as amended, by virtue of his direct and indirect stock holdings. Mr.
Nicholas is the only "promoter" of our company.
For the period ended June 30, 2009, a total of 9,000,000 shares of common stock
were issued to our sole officer and director, all of which are restricted
securities, as defined in Rule 144 of the Rules and Regulations of the SEC
promulgated under the Securities Act. Under Rule 144, the shares can be publicly
sold, subject to volume restrictions and restrictions on the manner of sale,
commencing one year after their acquisition. Under Rule 144, a shareholder can
sell up to 1% of total outstanding shares every three months in brokers'
transactions. Shares purchased in this offering, which will be immediately
resalable, and sales of all of our other shares after applicable restrictions
expire, could have a depressive effect on the market price, if any, of our
common stock and the shares the Company is offering.
Our sole officer and director will continue to own the majority of our common
stock after the offering, regardless of the number of shares sold. Since he will
continue control our company after the offering, investors in this offering will
be unable to change the course of our operations. Thus, the shares the Company
is offering lack the value normally attributable to voting rights. This could
result in a reduction in value of the shares you own because of their
ineffective voting power. None of our common stock is subject to outstanding
options, warrants, or securities convertible into common stock.
- 35 -
The Company is hereby registering 3,000,000 of its common shares, in addition to
the 9,000,000 shares currently issued and outstanding. The price per share is
$0.01 and will remain so for the duration of this offering, even if the shares
are quoted on the Over-The-Counter (OTC) Bulletin Board or an exchange.
The 9,000,000 shares currently issued and outstanding were acquired by our sole
officer and director for the period ended June 30, 2009. We issued a total of
9,000,000 common shares for consideration of $6,000, which was accounted for as
a purchase of common stock.
In the event the Company receives payment for the sale of their shares, Kids
Germ Defense Corp. will receive all of the proceeds from such sales. Kids Germ
Defense Corp. is bearing all expenses in connection with the registration of the
shares of the Company.
DESCRIPTION OF SECURITIES
COMMON STOCK
Our authorized number of shares is one hundred million (100,000,000). The
authorized common stock is one hundred million (100,000,000) shares with a par
value of $.0001 for an aggregate par value of ten thousand dollars ($10,000).
* have equal ratable rights to dividends from funds legally available if and
when declared by our Board of Directors;
* are entitled to share ratably in all of our assets available for
distribution to holders of common stock upon liquidation, dissolution or
winding up of our affairs;
* do not have preemptive, subscription or conversion rights and there are no
redemption or sinking fund provisions or rights;
* and are entitled to one non-cumulative vote per share on all matters on
which stockholders may vote.
We refer you to the Bylaws of our Articles of Incorporation and the applicable
statutes of the State of Florida for a more complete description of the rights
and liabilities of holders of our securities.
NON-CUMULATIVE VOTING
Holders of shares of our common stock do not have cumulative voting rights,
which means that the holders of more than 50% of the outstanding shares, voting
for the election of directors, can elect all of the directors to be elected, if
they so choose, and, in that event, the holders of the remaining shares will not
be able to elect any of our directors. After this offering is completed, present
stockholders will own approximately 75% of our outstanding shares.
CASH DIVIDENDS
As of the date of this prospectus, the Company has not declared or paid any cash
dividends to stockholders. The declaration of any future cash dividend will be
at the discretion of our Board of Directors and will depend upon our earnings,
if any, our capital requirements and financial position, our general economic
conditions, and other pertinent conditions. It is our present intention not to
pay any cash dividends in the foreseeable future, but rather to reinvest
earnings, if any, in our business operations.
- 36 -
REPORTING
After we complete this offering, the Company will not be required to furnish you
with an annual report. Further, the Company will not voluntarily send you an
annual report. We will be required to file reports with the SEC under section
15(d) of the Securities Act. The reports will be filed electronically. The
reports the Company will be required to file are Forms 10-K, 10-Q, and 8-K. You
may read copies of any materials we file with the SEC at the SEC's Public
Reference Room at 100 F Street, N.E., 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 site that will contain copies
of the reports we file electronically. The address for the Internet site is
www.sec.gov.
STOCK TRANSFER AGENT
The Company has not engaged the services of a transfer agent at this time.
However, within the next twelve months we anticipate doing so. Until such a time
a transfer agent is retained, KGDC will act as its own transfer agent.
STOCK OPTION PLAN
The Board of Directors of KGDC has not adopted a stock option plan ("Stock
Option Plan"). The Company has no plans to adopt a stock option plan but may
choose to do so in the future. If such a plan is adopted, this plan may be
administered by the board or a committee appointed by the board (the
"Committee"). The committee would have the power to modify, extend or renew
outstanding options and to authorize the grant of new options in substitution
therefore, provided that any such action may not, without the written consent of
the optionee, impair any rights under any option previously granted. Kids Germ
Defense Corp. may develop an incentive based stock option plan for its officers
and directors and may reserve up to 10% of its outstanding shares of common
stock for that purpose.
LITIGATION
The Company is not a party to any pending litigation and none is contemplated or
threatened.
LEGAL MATTERS
The validity of the securities offered by this prospectus has been passed upon
for us by Daniel Mirman, Mirman Law Office, 18 West 21st St. New York, New York
10010, 212-542-0540.
EXPERTS
Our financial statements have been audited for the period ending March 31, 2009
by Seale and Beers, CPAs, as set forth in their report included in this
prospectus. Their report is given upon their authority as experts in accounting
and auditing.
- 37 -
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS Audited March 31, 2009
Auditors' Report .......................................................... F-2
Balance Sheet ............................................................. F-3
Statement of Operations ................................................... F-4
Statement of Stockholders' Equity (Deficit) ............................... F-5
Statement of Cash Flows ................................................... F-6
Notes to the Financial Statements ......................................... F-7
F-1
SEALE AND BEERS, CPAS
PCAOB & CPAB REGISTERED AUDITORS
--------------------------------
www.sealebeers.com
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
-------------------------------------------------------
TO THE BOARD OF DIRECTORS
KIDS GERM DEFENSE CORP
(A DEVELOPMENT STAGE COMPANY)
We have audited the accompanying balance sheet of Kids Germ Defense Corp (A
Development Stage Company) as of March 31, 2009, and the related statements of
operations, stockholders' equity (deficit) and cash flows for the period from
inception on January 16, 2009 through March 31, 2009. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.
We conduct our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Kids Germ Defense Corp (A
Development Stage Company) as of March 31, 2009, and the related statements of
operations, stockholders' equity and cash flows for the period from inception on
January 16, 2009 through March 31, 2009, in conformity with accounting
principles generally accepted in the United States of America.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 to the
financial statements, the Company has an accumulated deficit of $649, which
raises substantial doubt about its ability to continue as a going concern.
Management's plans concerning these matters are also described in Note 6. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
/S/ SEALE AND BEERS, CPAS
Seale and Beers, CPAs
Las Vegas, Nevada
August 21, 2009
6490 West Desert Inn Rd, Las Vegas, NV 89146 (702) 253-7492 Fax (702) 253-7501
------------------------------------------------------------------------------
F-2
KIDS GERM DEFENSE CORP.
(A Development Stage Company)
Balance Sheet
ASSETS
------
As of
March 31,
2009
---------
CURRENT ASSETS
Cash and Cash equivalents .................................... $ 5,351
-------
Total Current Assets ...................................... 5,351
-------
TOTAL ASSETS .............................................. $ 5,351
=======
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
----------------------------------------------
CURRENT LIABILITIES
Accounts payable and accrued expenses ........................ $ -
Total Current Liabilities ................................. -
-------
STOCKHOLDERS' EQUITY (DEFICIT)
Capital Stock (Note 3)
Authorized:
100,000,000 common shares, $.0001 par value
Issued and outstanding shares 9,000,000 ................ 900
Additional paid-in capital ................................... 5,100
Deficit accumulated during the development stage ............. (649)
-------
Total Stockholders' Equity (Deficit) ...................... 5,351
-------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) ........................................ $ 5,351
=======
The accompanying notes are an integral part of these financial statements.
F-3
KIDS GERM DEFENSE CORP.
(A Development Stage Company)
Statement of Operations
January 16, 2009
(inception) to
March 31,
2009
----------------
REVENUES ............................................... $ -
OPERATING EXPENSES
General & Administrative ............................ 649
Total Operating Expenses ......................... 649
---------------
LOSS FROM OPERATIONS ................................... (649)
---------------
OTHER EXPENSES
Interest expense .................................... -
---------------
Total Other Expenses ............................. -
---------------
LOSS BEFORE INCOME TAXES ............................... (649)
PROVISION FOR INCOME TAXES ............................. -
---------------
NET LOSS ............................................... $ (649)
===============
PER SHARE DATA
BASIC LOSS PER COMMON SHARE ......................... $ (0.00007)
===============
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING ........................ 9,000,000
===============
The accompanying notes are an integral part of these financial statements
F-4
KIDS GERM DEFENSE CORP.
(A Development Stage Company)
Statement of Stockholders' Equity (Deficit)
Deficit
Accumulated Total
Common Stock Additional During the Stockholders'
------------------ Paid-In Development Equity
Shares Amount Capital Stage (Deficit)
--------- ------ ---------- ----------- -------------
Inception, January 16, 2009 - $ - $ $ - $ -
Shares issued for cash
at par $.0001 per share
January 16, 2009 ........ 9,000,000 900 5,100 - 6,000
Net loss from inception on
January 16, 2009 through
March 31, 2009 .......... - - - (649) (649)
--------- ------ ---------- ---------- ------------
Balance, March 31, 2009 ... 9,000,000 $ 900 $ 5,100 $ (649) $ 5,351
========= ====== ========== ========== ============
The accompanying notes are an integral part of these financial statements
F-5
KIDS GERM DEFENSE CORP.
(A Development Stage Company)
Statement of Cash Flows
January 16, 2009
(inception) to
March 31,
2009
----------------
OPERATING ACTIVITIES
Net loss ................................................. $ (649)
Changes in Operating Assets and Liabilities:
(Increase) decrease in prepaid expenses .................. -
Increase (decrease) in accounts payable .................. -
Increase (decrease) in accrued liabilities ............... -
Increase in short-term note payable (leasehold) .......... -
---------------
Net Cash Used by Operating Activities ................. (649)
---------------
INVESTING ACTIVITIES ........................................ -
---------------
Net cash used in operating activities .................... -
---------------
FINANCING ACTIVITIES
Common stock issued for cash ............................. 6,000
---------------
Net Cash Provided by Financing Activities ............. 6,000
---------------
NET INCREASE IN CASH AND CASH EQUIVALENTS ................ 5,351
CASH & CASH EQUIVALENTS AT BEGINNING OF PERIOD ........... -
---------------
CASH & CASH EQUIVALENTS AT END OF PERIOD ................. $ 5,351
===============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
CASH PAID FOR:
Interest .............................................. $ -
Income Taxes .......................................... $ -
The accompanying notes are an integral part of these financial statements.
F-6
KIDS GERM DEFENSE CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. GENERAL ORGANIZATION AND BUSINESS
KIDS GERM DEFENSE CORP. (A Development Stage Company) was incorporated on
January 16, 2009 under the laws of the State of Florida to develop and sell germ
defense products for young children. It has no operations and in accordance with
SFAS #7 is considered to be in the development stage. The Company's fiscal year
end is December 31.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
Accounting Basis
----------------
These financial statements are prepared on the accrual basis of accounting in
conformity with accounting principles generally accepted in the United States of
America.
Cash and Cash Equivalents
-------------------------
For the purpose of the financial statements cash equivalents include all highly
liquid investments with maturity of three months or less.
Earnings (Loss) per Share
-------------------------
The basic earnings (loss) per share are calculated by dividing the Company's net
income available to common shareholders by the weighted average number of common
shares outstanding during the year. The diluted earnings (loss) per share are
calculated by dividing the Company's net income (loss) available to common
shareholders by the diluted weighted average number of shares outstanding during
the year. The diluted weighted average number of shares outstanding is the basic
weighted number of shares adjusted as of the first of the year for any
potentially dilutive debt or equity. There are no diluted shares outstanding.
Dividends
---------
The Company has not adopted any policy regarding payment of dividends. No
dividends have been paid during the period shown.
Income Taxes
------------
The Company provides for income taxes under Statement of Financial Accounting
Standards NO. 109, "Accounting for Income Taxes". SFAS No. 109 requires the use
of an asset and liability approach in accounting for income taxes.
Advertising
-----------
The Company expenses advertising as incurred. The advertising since inception
has been $0.0
F-7
KIDS GERM DEFENSE CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
SFAS No. 109 requires the reduction of deferred tax assets by a valuation
allowance if, based on the weight of available evidence, it is more likely than
not that some or all of the deferred tax assets will not be realized. No
provision for income taxes is included in the statement due to its immaterial
amount, net of the allowance account, based on the likelihood of the Company to
utilize the loss carry-forward
Use of Estimates
----------------
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those estimates.
Revenue and Cost Recognition
----------------------------
The Company has no current source of revenue; therefore the Company has not yet
adopted any policy regarding the recognition of revenue or cost.
NOTE 3. INCOME TAXES:
The Company provides for income taxes under Statement of Financial Accounting
Standards No. 109, Accounting for Income Taxes. SFAS No. 109 requires the use of
an asset and liability approach in accounting for income taxes. Deferred tax
assets and liabilities are recorded based on the differences between the
financial statement and tax bases of assets and liabilities and the tax rates in
effect currently.
SFAS No. 109 requires the reduction of deferred tax assets by a valuation
allowance if, based on the weight of available evidence, it is more likely than
not that some or all of the deferred tax assets will not be realized. In the
Company's opinion, it is uncertain whether they will generate sufficient taxable
income in the future to fully utilize the net deferred tax asset. Details for
the last three years follow:
Year Ended March 31 2009
------------------- ----
Deferred Tax Asset
Valuation Allowance
Current Taxes Payable 0.00
--------
Income Tax Expense $ 0.00
========
The Company has filed no income tax returns since inception.
F-8
KIDS GERM DEFENSE CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 4. STOCKHOLDERS' EQUITY
Common Stock
On January 16, 2009, the Company issued 9,000,000 of its common stock for
$0.0006667 or $6,000 cash to the founders of the Company.
There are 100,000,000 Common Shares at $0.0001 par value Authorized with
9,000,000 Issued and Outstanding as of March 31, 2009.
NOTE 5. RELATED PARTY TRANSACTIONS
The officers and directors of the Company are involved in other business
activities and may, in the future, become involved in other business
opportunities that become available. They may face a conflict in selecting
between the Company and other business interests. The Company has not formulated
a policy for the resolution of such conflicts.
The Company does not own or lease property or lease office space. The office
space used by the Company was arranged by the founder of the Company to use at
no charge.
NOTE 6. GOING CONCERN
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. For the period January 16, 2009 (date
of inception) through March 31, 2009 the Company has had a net loss of $649. As
of March 31, 2009, the Company has not emerged from the development stage. In
view of these matters, recoverability of any asset amounts shown in the
accompanying financial statements is dependent upon the Company's ability to
begin operations and to achieve a level of profitability. Since inception, the
Company has financed its activities principally from the sale of equity
securities. The Company intends on financing its future development activities
and its working capital needs largely from loans and the sale of public equity
securities with some additional funding from other traditional financing
sources, including term notes, until such time that funds provided by operations
are sufficient to fund working capital requirements.
NOTE 7. CONCENTRATIONS OF RISKS
Cash Balances
-------------
The Company maintains its cash in institutions insured by the Federal Deposit
Insurance Corporation (FDIC). This government corporation insured balances up to
$100,000 through October 13, 2008. As of October 14, 2008 all non-interest
bearing transaction deposit accounts at an FDIC-insured institution, including
all personal and business checking deposit accounts that do not earn interest,
are fully insured for the entire amount in the deposit account. This unlimited
insurance coverage is temporary and will remain in effect for participating
institutions until December 31, 2009. All other deposit accounts at FDIC-insured
institutions are insured up to at least $250,000 per depositor until December
31, 2009. On January 1, 2010, FDIC deposit insurance for all deposit accounts,
except for certain retirement accounts, will return to at least $100,000 per
depositor. Insurance coverage for certain retirement accounts, which include all
IRA deposit accounts, will remain at $250,000 per depositor.
F-9
KIDS GERM DEFENSE CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 8. THE EFFECT OF RECENTLY ISSUED ACCOUNTING STANDARDS
Below is a listing of the most recent accounting standards and their effect on
the Company.
Recent Accounting Pronouncements
--------------------------------
In June 2008, the FASB issued FASB Staff Position EITF 03-6-1, Determining
Whether Instruments Granted in Share-Based Payment Transactions Are
Participating Securities, ("FSP EITF 03-6-1"). FSP EITF 03-6-1 addresses whether
instruments granted in share-based payment transactions are participating
securities prior to vesting, and therefore need to be included in the
computation of earnings per share under the two-class method as described in
FASB Statement of Financial Accounting Standards No. 128, "Earnings per Share."
FSP EITF 03-6-1 is effective for financial statements issued for fiscal years
beginning on or after December 15, 2008 and earlier adoption is prohibited. We
are not required to adopt FSP EITF 03-6-1; neither do we believe that FSP EITF
03-6-1 would have material effect on our consolidated financial position and
results of operations if adopted.
In May 2008, the Financial Accounting Standards Board ("FASB") issued SFAS No.
163, "Accounting for Financial Guarantee Insurance Contracts-and interpretation
of FASB Statement No. 60". SFAS No. 163 clarifies how Statement 60 applies to
financial guarantee insurance contracts, including the recognition and
measurement of premium revenue and claims liabilities. This statement also
requires expanded disclosures about financial guarantee insurance contracts.
SFAS No. 163 is effective for fiscal years beginning on or after December 15,
2008, and interim periods within those years. SFAS No. 163 has no effect on the
Company's financial position, statements of operations, or cash flows at this
time.
In May 2008, the Financial Accounting Standards Board ("FASB") issued SFAS No.
162, "The Hierarchy of Generally Accepted Accounting Principles". SFAS No. 162
sets forth the level of authority to a given accounting pronouncement or
document by category. Where there might be conflicting guidance between two
categories, the more authoritative category will prevail. SFAS No. 162 will
become effective 60 days after the SEC approves the PCAOB's amendments to AU
Section 411 of the AICPA Professional Standards. SFAS No. 162 has no effect on
the Company's financial position, statements of operations, or cash flows at
this time.
In March 2008, the Financial Accounting Standards Board, or FASB, issued SFAS
No. 161, Disclosures about Derivative Instruments and Hedging Activities--an
amendment of FASB Statement No. 133. This standard requires companies to provide
enhanced disclosures about (a) how and why an entity uses derivative
instruments, (b) how derivative instruments and related hedged items are
accounted for under Statement 133 and its related interpretations, and (c) how
derivative instruments and related hedged items affect an entity's financial
position, financial performance, and cash flows. This Statement is effective for
financial statements issued for fiscal years and interim periods beginning after
November 15, 2008, with early application encouraged. The Company has not yet
adopted the provisions of SFAS No. 161, but does not expect it to have a
material impact on its consolidated financial position, results of operations or
cash flows.
F-10
KIDS GERM DEFENSE CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
In December 2007, the SEC issued Staff Accounting Bulletin (SAB) No. 110
regarding the use of a "simplified" method, as discussed in SAB No. 107 (SAB
107), in developing an estimate of expected term of "plain vanilla" share
options in accordance with SFAS No. 123 (R), Share-Based Payment. In particular,
the staff indicated in SAB 107 that it will accept a company's election to use
the simplified method, regardless of whether the Company has sufficient
information to make more refined estimates of expected term. At the time SAB 107
was issued, the staff believed that more detailed external information about
employee exercise behavior (e.g., employee exercise patterns by industry and/or
other categories of companies) would, over time, become readily available to
companies. Therefore, the staff stated in SAB 107 that it would not expect a
company to use the simplified method for share option grants after December 31,
2007. The staff understands that such detailed information about employee
exercise behavior may not be widely available by December 31, 2007. Accordingly,
the staff will continue to accept, under certain circumstances, the use of the
simplified method beyond December 31, 2007. The Company currently uses the
simplified method for "plain vanilla" share options and warrants, and will
assess the impact of SAB 110 for fiscal year 2009. It is not believed that this
will have an impact on the Company's consolidated financial position, results of
operations or cash flows.
In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in
Consolidated Financial Statements--an amendment of ARB No. 51. This statement
amends ARB 51 to establish accounting and reporting standards for the
noncontrolling interest in a subsidiary and for the deconsolidation of a
subsidiary. It clarifies that a noncontrolling interest in a subsidiary is an
ownership interest in the consolidated entity that should be reported as equity
in the consolidated financial statements. Before this statement was issued,
limited guidance existed for reporting noncontrolling interests. As a result,
considerable diversity in practice existed. So-called minority interests were
reported in the consolidated statement of financial position as liabilities or
in the mezzanine section between liabilities and equity. This statement improves
comparability by eliminating that diversity. This statement is effective for
fiscal years, and interim periods within those fiscal years, beginning on or
after December 15, 2008 (that is, January 1, 2009, for entities with calendar
year-ends). Earlier adoption is prohibited. The effective date of this statement
is the same as that of the related Statement 141 (revised 2007). The Company
will adopt this Statement beginning March 1, 2009. It is not believed that this
will have an impact on the Company's consolidated financial position, results of
operations or cash flows.
In December 2007, the FASB, issued FAS No. 141 (revised 2007), Business
Combinations'. This Statement replaces FASB Statement No. 141, Business
Combinations, but retains the fundamental requirements in Statement 141. This
Statement establishes principles and requirements for how the acquirer: (a)
recognizes and measures in its financial statements the identifiable assets
acquired, the liabilities assumed, and any noncontrolling interest in the
acquiree; (b) recognizes and measures the goodwill acquired in the business
combination or a gain from a bargain purchase; and (c) determines what
F-11
KIDS GERM DEFENSE CORP.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
information to disclose to enable users of the financial statements to evaluate
the nature and financial effects of the business combination. This statement
applies prospectively to business combinations for which the acquisition date is
on or after the beginning of the first annual reporting period beginning on or
after December 15, 2008. An entity may not apply it before that date. The
effective date of this statement is the same as that of the related FASB
Statement No. 160, Noncontrolling Interests in Consolidated Financial
Statements. The Company will adopt this statement beginning March 1, 2009. It is
not believed that this will have an impact on the Company's consolidated
financial position, results of operations or cash flows.
In February 2007, the FASB, issued SFAS No. 159, The Fair Value Option for
Financial Assets and Liabilities--Including an Amendment of FASB Statement No.
115. This standard permits an entity to choose to measure many financial
instruments and certain other items at fair value. This option is available to
all entities. Most of the provisions in FAS 159 are elective; however, an
amendment to FAS 115 Accounting for Certain Investments in Debt and Equity
Securities applies to all entities with available for sale or trading
securities. Some requirements apply differently to entities that do not report
net income. SFAS No. 159 is effective as of the beginning of an entity's first
fiscal year that begins after November 15, 2007. Early adoption is permitted as
of the beginning of the previous fiscal year provided that the entity makes that
choice in the first 120 days of that fiscal year and also elects to apply the
provisions of SFAS No. 157 Fair Value Measurements. The Company will adopt SFAS
No. 159 beginning March 1, 2008 and is currently evaluating the potential impact
the adoption of this pronouncement will have on its consolidated financial
statements.
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements. This
statement defines fair value, establishes a framework for measuring fair value
in generally accepted accounting principles (GAAP), and expands disclosures
about fair value measurements. This statement applies under other accounting
pronouncements that require or permit fair value measurements, the Board having
previously concluded in those accounting pronouncements that fair value is the
relevant measurement attribute. Accordingly, this statement does not require any
new fair value measurements. However, for some entities, the application of this
statement will change current practice. This statement is effective for
financial statements issued for fiscal years beginning after November 15, 2007,
and interim periods within those fiscal years. Earlier application is
encouraged, provided that the reporting entity has not yet issued financial
statements for that fiscal year, including financial statements for an interim
period within that fiscal year. The Company will adopt this statement March 1,
2008, and it is not believed that this will have an impact on the Company's
consolidated financial position, results of operations or cash flows.
F-12
FINANCIAL STATEMENTS
FINANCIAL STATEMENTS Reviewed June 30, 2009
Balance Sheet ............................................................. F-14
Statement of Operations ................................................... F-15
Statement of Stockholders' Equity (Deficit) ............................... F-16
Statement of Cash Flows ................................................... F-17
Notes to the Financial Statements ......................................... F-18
F-13
KIDS GERM DEFENSE CORP
(A Development Stage Company)
Balance Sheets
ASSETS
------
As of As of
June 30, March 31, 2009
2009 (Audited)
-------- --------------
CURRENT ASSETS
Cash and Cash equivalents ...................... $ 210 $ 5,351
------- -------
Total Current Assets ......................... 210 5,351
------- -------
TOTAL ASSETS ................................. $ 210 $ 5,351
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
----------------------------------------------
CURRENT LIABILITIES
Accounts payable and accrued expenses .......... $ - $ -
Notes payable to related party ................. $ 2,000 $ -
Total Current Liabilities .................... 2,000 -
------- -------
STOCKHOLDERS' EQUITY (DEFICIT)
Capital Stock (Note 3)
Authorized:
100,000,000 common shares, $.0001 par value
Issued and outstanding shares 9,000,000 .... $ 900 900
Additional paid-in capital ..................... 5,100 5,100
Deficit accumulated during the development stage $(7,790) (649)
------- -------
Total Stockholders' Equity (Deficit) ......... $(1,790) 5,351
------- -------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY (DEFICIT) ........................... $ 210 $ 5,351
======= =======
The accompanying notes are an integral part of these financial statements.
F-14
KIDS GERM DEFENSE CORP
(A Development Stage Company)
Statements of Operations
For the Three January 16, 2009,
Months Ended (inception) to
June 30, June 30,
2009 2009
------------ -----------------
REVENUES ............................. $ - $ -
------------ ------------
OPERATING EXPENSES
General and administrative ......... 7,141 7,790
------------ ------------
Total Operating Expenses ......... 7,141 7,790
------------ ------------
LOSS FROM OPERATIONS ................. (7,141) (7,790)
------------ ------------
OTHER EXPENSES
Interest expense ................... - -
------------ ------------
Total Other Expenses ............. - -
------------ ------------
LOSS BEFORE INCOME TAXES ............. (7,141) (7,790)
PROVISION FOR INCOME TAXES ........... - -
------------ ------------
NET LOSS ............................. $ (7,141) $ (7,790)
============ ============
BASIC LOSS PER COMMON SHARE .......... $ (0.001)
============
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING .......... 9,000,000
============
The accompanying notes are an integral part of these financial statements
F-15
KIDS GERM DEFENSE CORP
(A Development Stage Company)
Statement of Stockholders' Equity (Deficit)
Deficit
Accumulated Total
Common Stock Additional During the Stockholders'
--------------------- Paid-In Development Equity
Shares Amount Capital Stage (Deficit)
--------- --------- ---------- ----------- -------------
Inception, January 16, 2009 .. - $ - $ - $ - $ -
Shares issued for cash
(par value $0.0001) at
$0.000667 per share
January 16, 2009 ........... 9,000,000 900 5,100 - 6,000
Net loss from inception on
January 16, 2009 through
March 31, 2009 ............. - - - (649) (649)
--------- --------- ---------- ---------- ------------
Balance, March 31, 2009 ...... 9,000,000 $ 900 $ 5,100 $ (649) $ 5,351
========= ========= ========== ========== ============
Net loss for the Quarter
ended June 30, 2009 ........ - - - (7,141) (7,141)
--------- --------- ---------- ---------- ------------
Balance, June 30, 2009 ....... 9,000,000 $ 900 $ 5,100 $ (7,790) $ (1,790)
========= ========= ========== ========== ============
The accompanying notes are an integral part of these financial statements
F-16
KIDS GERM DEFENSE CORP
(A Development Stage Company)
Statements of Cash Flows
For the Three January 16, 2009,
Months Ended (inception) to
June 30, June 30,
2009 2009
------------- -----------------
OPERATING ACTIVITIES
Net loss ................................... $(7,141) $(7,790)
Adjustments to Reconcile Net Loss to Net
Cash Used by Operating Activities:
Changes in operating assets and liabilities:
(Increase) decrease in prepaid expenses .. - -
Increase (decrease) in accounts payable .. - -
Increase (decrease) in accrued liabilities $ 2,000 -
Increase in short-term note payable
(leasehold) ............................. - -
------- -------
Net Cash Used by Operating Activities .. $(5,141) $(7,790)
------- -------
INVESTING ACTIVITIES ......................... - -
------- -------
Net cash used in Investing activities ...... - -
FINANCING ACTIVITIES
Common stock issued for cash ............... - $ 6,000
------- -------
Net Cash Provided by Financing Activities .. - -
------- -------
NET INCREASE IN CASH AND CASH EQUIVALENTS
CASH & CASH EQUIVALENTS AT BEGINNING OF
PERIOD .................................... $ 5,351 $ -
------- -------
CASH & CASH EQUIVALENTS AT END OF PERIOD ... $ 210 $ 210
======= =======
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION
CASH PAID FOR:
Interest ................................. $ - $ -
Income Taxes ............................. $ - $ -
The accompanying notes are an integral part of these financial statements.
F-17
KIDS GERM DEFENSE CORP.
(A Development Stage Company)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
(JUNE 30, 2009)
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statements have been prepared by the Company
without audit. In the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to present fairly
the financial position, results of operations, and cash flows at June
30, 2009 and for all periods presented herein, have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with accounting principles
generally accepted in the United States of America have been condensed
or omitted. It is suggested that these condensed financial statements
be read in conjunction with the financial statements and notes thereto
included in the Company's March 31, 2009 audited financial statements.
The results of operations for the periods ended June 30, 2009 are not
necessarily indicative of the operating results for the full years.
NOTE 2 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles in the United States of America
applicable to a going concern which contemplates the realization of
assets and liquidation of liabilities in the normal course of business.
The Company has not yet established an ongoing source of revenues
sufficient to cover its operating costs and allow it to continue as a
going concern. The ability of the Company to continue as a going
concern is dependent on the Company obtaining adequate capital to fund
operating losses until it becomes profitable. If the Company is unable
to obtain adequate capital, it could be forced to cease operations.
In order to continue as a going concern, the Company will need, among
other things, additional capital resources. Management's plan is to
obtain such resources for the Company by obtaining capital from
management and significant shareholders sufficient to meet its minimal
operating expenses and seeking equity and/or debt financing. However
management cannot provide any assurances that the Company will be
successful in accomplishing any of its plans.
The ability of the Company to continue as a going concern is dependent
upon its ability to successfully accomplish the plans described in the
preceding paragraph and eventually secure other sources of financing
and attain profitable operations. The accompanying financial statements
do not include any adjustments that might be necessary if the Company
is unable to continue as a going concern.
F-18
PART II. INFORMATION NOT REQUIRED IN THE PROSPECTUS
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The registrant will pay for all expenses incurred by this offering. Whether or
not all of the offered shares are sold, these expenses are estimated as follows:
Securities and Exchange Commission registration fee ............ $ 3.14
Federal Taxes .................................................. $ 0
State Taxes and Fees ........................................... $ 0
Listing Fees ................................................... $ 0
Printing Fees .................................................. $ 300.00
Transfer Agent Fees ............................................ $ 1,200.00
Accounting fees and expenses ................................... $ 2,000.00
Legal fees and expenses ........................................ $ 1,500.00
----------
TOTAL .......................................................... $ 5,000.14
==========
RECENT SALES OF UNREGISTERED SECURITIES
(a) Prior sales of common shares
KGDC is authorized to issue up to 100,000,000 shares of common stock with a par
value of $0.0001.
There have been no sales of unregistered securities which would be required to
be disclosed pursuant to Item 701 of Regulation S-K, except for the following:
In January 2009, the Company issued 9,000,000 shares to Mark Nicholas, the
Company's founder, in exchange for cash of $6,000. The Company relied upon
Section 4(2) of the Securities Act, which exempts from registration
"transactions by an issuer not involving any public offering." The securities
offered to Mr. Nicholas in January 2009 were not offered publicly, and the
shares were only issued to Mr. Nicholas in connection with the founding of the
company.
KGDC is not listed for trading on any securities exchange in the United States,
and there has been no active market in the United States or elsewhere for the
common shares.
EXHIBITS
The following exhibits are filed as part of this registration statement,
pursuant to Item 601 of Regulation K. All exhibits have been previously filed
unless otherwise noted.
EXHIBIT NO. DOCUMENT DESCRIPTION
----------- --------------------
3.1 Amended and Restated Articles of Incorporation of Kids Germ
Defense Corp.*
3.2 Bylaws of Kids Germ Defense Corp.*
4.1 Specimen Stock Certificate of Kids Germ Defense Corp.*
5.1 Opinion of Counsel.**
14.1 Code of Ethics *
II-1
23.1 Consent of Accountants.**
23.2 Consent of Counsel (included in Exhibit 5.1).**
99.1 Subscription Agreement of Kids Germ Defense Corp.*
______________
* Previously filed
** Filed herewith
(B) DESCRIPTION OF EXHIBITS
EXHIBIT 3.1
Amended and Restated Articles of Incorporation of Kids Germ Defense Corp., Inc.
dated January 16, 2009 and approved January 16, 2009.
EXHIBIT 3.2
Bylaws of Kids Germ Defense Corp., approved and adopted on January 16, 2009.
EXHIBIT 4.1
Specimen Stock Certificate of Kids Germ Defense Corp.
EXHIBIT 5.1
Opinion of Daniel Mirman, Mirman Law Office dated November 15, 2009.
EXHIBIT 14.1
Code of Ethics
EXHIBIT 23.1
Consent of Accountants, regarding the use in this Registration Statement of
their auditors' report on the financial statements of Kids Germ Defense Corp.
for the period ending March 31, 2009.
EXHIBIT 23.2
Consent of Counsel (included in Exhibit 5.1).
EXHIBIT 99.1
Subscription Agreement of Kids Germ Defense Corp.
UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Securities Act of
1933 (the "Act") may be permitted to directors, officers and controlling persons
of the Company pursuant to the foregoing provisions, or otherwise, the Company
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy and as expressed in the Act and
is, therefore, unenforceable.
II-2
The Company 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 10(a)(3) of 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.
iii. Include any additional or changed material information on the
plan of distribution.
(2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial bona
fide offering.
(3) File a post-effective amendment to remove from registration any of the
securities that remain unsold at the end of the offering.
(4) For determining any liability under the Securities Act, treat the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Company under Rule 424(b)(1) or (4) or 497(h) under the
Securities Act as part of this registration statement as of the time the
Commission declared it effective.
(5) For determining any liability under the Securities Act, treat each
post-effective amendment that contains a form of prospectus as a new
registration statement for the securities offered in the registration statement,
and that offering of the securities at that time as the initial bona fide
offering of those securities.
(6) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to our directors, officers and
controlling persons pursuant to the foregoing provisions, or otherwise, the
Company has been advised by the Securities and Exchange Commission that such
indemnification is against public policy as expressed in the 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 one of our directors,
officers or controlling persons 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 Company will, unless in the
opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by us is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of filing on this Form S-1. Furthermore, the registrant has
authorized this registration statement and has duly caused this Form S-1
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in Sarasota, Florida, on this 17th day of November, 2009.
KIDS GERM DEFENSE CORP.
/s/ MARK NICHOLAS
-------------
MARK NICHOLAS
President and Director
Principal Executive Officer
Principal Financial Officer
Principal Accounting Officer
Know all men by these present, that each person whose signature appears below
constitutes and appoints Mark Nicholas, as agent, with full power of
substitution, for his and in his name, place and stead, in any and all
capacities, to sign any and all amendments, including post-effective amendments,
to this registration statement, and to file the same, therewith, with the
Securities and Exchange Commission, and to make any and all state securities law
filings, granting unto said attorney-in-fact and agent, full power and authority
to do and perform each and every act and thing requisite or necessary to be done
in about the premises, as fully to all intents and purposes as he might or could
do in person, hereby ratifying the confirming all that said attorney-in-fact and
agent, or any substitute or substitutes, may lawfully do or cause to be done by
virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this
Form S-1 registration statement has been signed by the following persons in the
capacities and on the dates indicated:
/s/ MARK NICHOLAS November 17, 2009
-------------
MARK NICHOLAS
President and Director
Principal Executive Officer
Principal Financial Officer
Principal Accounting Office