Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form S-8
Registration Statement
Under
The Securities Act of 1933
INTEGRATED MANAGEMENT INFORMATION, INC.
----------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado 43-1802805
(State or other jurisdiction (IRS Employer
of incorporation) Identification No.)
221 Wilcox , Suite A, Castle Rock, Colorado 80104
- ------------------------------------------- -----------
(Address of Principal Executive Offices) (Zip Code)
2005 Stock Option Plan
2006 Equity Incentive Plan
Registration of 1,650,000 shares underlying options
issued to the CFO under an employment contract
Copy to:
Registered Agent Hank Vanderkam
----------------
John Saunders Vanderkam & Associates
221 Wilcox, Suite A 1301 Travis, #1200
Castle Rock, CO 80104 Houston, Texas 77002
(303) 895-3002 (713) 547-8900
--------------
(Name, address and telephone
number of agent for service)
Approximate date of proposed sales pursuant to the plan: From time to time after
the effective date of this Registration Statement.
CALCULATION OF REGISTRATION FEE
=================================================================================================
Proposed maximum Proposed maximum Amount of
Title of securities Amount to be offering price per aggregate offering registration
to be registered registered share (1) price fee
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
Common Stock, $.001 par value 6,112,500 $0.25 1,528,125 163.06
=================================================================================================
(1) This Registration Statement covers (i) 1,462,500 shares of Common Stock
(the "Common Stock"), $0.001 par value per share, of Integrated
Management Corporation. ("IMI")(the "Registrant") issuable pursuant to
the 2005 Stock Option Plan (the "2005 Option Plan") ii 3,000,000 shares
of Common Stock under the 2006 Equity Incentive Plan that have been or
may be issued to certain officers, employees or directors of the
Company pursuant to the Plan and (iii) 1,650,000 shares of Common Stock
underlying the options issued to the company's chief financial officer
under his employment contract. In addition, pursuant to Rule 416(c)
under the Securities Act of 1933, as amended (the "Securities Act")
this Registration Statement covers an indeterminable number of
additional shares of Common Stock as may hereafter be offered or issued
pursuant to the Plans, to prevent dilution resulting from stock splits,
stock dividends or similar transactions effected without receipt of
consideration.
(2) Calculated in accordance with Rule 457(c) solely for the purpose of
determining the registration fee. The offering price is based on the
closing price as reported on the Nasdaq Electronic Bulletin Board on
March 6, 2007 under the symbol "INMG".
This Registration Statement contains two parts. The first part contains a
prospectus pursuant to Form S-3 (in accordance with Section C of the General
Instructions to the Form S-8) which covers reoffers and resales of "restricted
securities" and/or "control securities" (as such terms are defined in Section C
of the General Instructions to Form S-8) of the Company. This reoffer prospectus
relates to up to 1,462,500 shares of Common Stock under the 2005 Stock Option
Plan (ii) 3,000,000 shares of Common Stock under the 2006 Equity Inventive Plan,
that have been or may be issued to certain officers, employees or directors of
the Company pursuant to the Plan and (iii) 1,650,000 shares underlying options
that have been previously granted the chief financial officer as part of an
employment agreement. The second part of this Registration Statement contains
Information Required in the Registration Statement pursuant to Part II of Form
S-8. The Form S-8 portion of this Registration Statement will be used for offers
of shares of Common Stock issued under the 2005 Stock Option Plan, the 2006
Equity Incentive Plan and under the Employment contract with the Chief Financial
Officer.
PART I
INFORMATION REQUIRED IN SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION
The document(s) containing the information specified in Part I of
Form S-8 will be sent or given to participants in the Plans as specified by Rule
428(b)(1) under the Securities Act. Such documents are not being filed with the
Securities and Exchange Commission, but constitute, along with the documents
incorporated by reference into this Registration Statement, a prospectus that
meets the requirements of Section 10(a) of the Securities Act.
ITEM 2. REGISTRATION INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION
The Company will furnish without charge to each person to whom the
prospectus is delivered, upon the written or oral request of such person, a copy
of any and all of the documents incorporated by reference in Item 3 of Part II
of this Registration Statement, other than exhibits to such documents (unless
such exhibits are specifically incorporated by reference to the information that
is incorporated). Those documents are incorporated by reference in the Section
10(a) prospectus. Requests should be directed to Integrated Management
Information, Inc., 221 Wilcox, Suite A, Castle Rock, CO 80104.
The resale prospectus referred to above follows this page.
PROSPECTUS
INTEGRATED MANAGEMENT INFORMATION, INC.
6,112,500 SHARES OF COMMON STOCK
(par value $0.001 per share)
This prospectus relates to up to 6,112,500 shares (the "Shares") of common
stock, par value $0.001 per share, of Integrated Management Corporation., a
Colorado corporation (the "Company" or "IMI") which may be offered and sold from
time to time by certain stockholders of the Company (the "Selling Stockholders")
who have acquired or will acquire such Shares pursuant to stock options issued
or issuable under the (i) the 2005 Stock Option Plan dated March 12, 2005; (ii)
the 2006 Equity Incentive Plan dated February 6, 2007 (collectively referred to
herein as the "Plans") and (iii) the 1,650,000 shares issuable under the
Employment Contract with the Chief Financial Officer.
The Company will not receive any of the proceeds from sales of the Shares by any
of the Selling Stockholders. The Shares may be offered from time to time by any
or all of the Selling Stockholders (and their donees and pledgees) through
ordinary brokerage transactions, in negotiated transactions or in other
transactions, at such prices as he or she may determine, which may relate to
market prices prevailing at the time of sale or be a negotiated price. See "Plan
of Distribution." All costs, expenses and fees in connection with the
registration of the Shares will be borne by the Company. Brokerage commissions
and similar selling expenses, if any, attributable to the offer or sale of the
Shares will be borne by the Selling Stockholder (or their donees and pledgees).
Each Selling Stockholder and any broker executing selling orders on behalf
of a Selling Stockholder may be deemed to be an "underwriter" as defined in the
Securities Act of 1933, as amended (the "Securities Act"). If any broker-dealers
are used to effect sales, any commissions paid to broker-dealers and, if
broker-dealers purchase any of the Shares as principals, any profits received by
such broker-dealers on the resale of the Shares, may be deemed to be
underwriting discounts or commissions under the Securities Act. In addition, any
profits realized by the Selling Stockholders may be deemed to be underwriting
commissions.
Our common stock is quoted on the OTC Bulletin Board Service under the
symbol "INMG" On February 14, 2007, the average of the bid and ask closing price
of our common stock was $0.23 per share.
See "Risk Factors" on page 3 hereof for a discussion of certain factors
that should be carefully considered by prospective purchasers.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities, or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is February 14, 2007.
You should rely only on the information included in or incorporated by reference
into this prospectus or information we have referred to in this prospectus. We
have not authorized anyone to provide you with information that is different.
This prospectus may only be used where it is legal to sell these securities.
This prospectus is not an offer to sell, or a solicitation of an offer to buy,
in any state where the offer or sale is prohibited. The information in this
prospectus is accurate on the date of this prospectus and may become obsolete
later. Neither the delivery of this prospectus, nor any sale made under this
prospectus will, under any circumstances, imply that the information in this
prospectus is correct as of any date after the date of this prospectus.
References to "the Company," "IMI," "we" or "us" refer to Integrated Management
Corporation.
3
TABLE OF CONTENTS
Page
RISK FACTORS 4
FORWARD-LOOKING STATEMENTS 8
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 8
DESCRIPTION OF BUSINESS 9
USE OF PROCEEDS 14
SELLING STOCKHOLDERS 15
DESCRIPTION OF SECURITIES 16
PLAN OF DISTRIBUTION 16
WHERE YOU CAN FIND MORE INFORMATION 18
INTERESTS OF NAMED EXPERTS AND COUNSEL 19
RISK FACTORS
Prospective purchasers of the common stock should consider carefully the
following risk factors relating to the business of the Company, together with
the information and financial data set forth elsewhere in this prospectus or
incorporated herein by reference, prior to making an investment decision. This
prospectus contains forward-looking statements within the meaning of Section 27A
of the Securities Act and Section 21E of the Exchange Act. Such statements are
indicated by words or phrases such as "anticipate," "estimate," "project,"
"management believes," "we believe" and similar words or phrases. Such
statements are based on current expectations and are subject to risks,
uncertainties and assumptions. Certain of these risks are described below.
Should one or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those anticipated, estimated or projected.
Risks Related to Our Business
We have had a history of operating losses, and there is no assurance that we
will achieve profitability in the future.
We have a history of operating losses. For our calendar year ended December 31,
2005, we experienced a net loss from continuing operations of $1,027,972 and we
were unprofitable during the first nine months of 2006 with a net loss of
$1,117,240. It is uncertain if our future prospects will result in profitable
operations. If we experience losses, the value of an investment in our common
stock could decline significantly.
We may be unable to raise additional capital which is necessary to continue as
ongoing concern.
We will not receive any proceeds from the sale of the common stock covered by
this prospectus. If our business operations continue at their current levels, we
will be unable to generate sufficient revenue and cash for our planned
operations and will need to raise additional capital. Although we have raised
$821,460 in the last several months, we can give no assurances that additional
capital will be available to us on favorable terms, or at all. At present, we
have sufficient cash to fund our operations for approximately one year. Based on
our internal estimates, we will need approximately $950,000 to $1,000,000 over
the next twelve months. In September, 2006, our bank increased our line of
credit by $125,000 and we have raised $821,460 privately. As to any remaining
funds, we will seek to raise additional equity through the sale of shares or
convertible notes. Our inability to obtain additional capital, if and when
needed, would have a material adverse effect upon our financial condition and
our ability to continue as a going concern.
4
Market Acceptance of our recently introduced products is uncertain.
Although management believes that market acceptance of our recently introduced
products, particularly our USVerified Source and Age Verification Systems are
likely, market adoption is not certain. The Company can offer investors no
assurances that its products will generate sufficient revenues to support a
profitable business. If sales of these products are inadequate, revenues may not
be sufficient to sustain our business, which may result in cessation of
operations.
In excess of 40% of our projected near-term revenue growth is contingent upon
sales of USVerified Source and Age Verification Systems.
We are currently benefiting from a slow but growing movement among US beef
producers to source and age verify beef products. This emerging trend is fueled
in part by the reopening of US beef export trade with Japan and other countries.
The Company, however, can offer investors no assurances that even though trade
barriers to US beef exports, especially with respect to Japan, have been
lifted,that there will be market acceptance of U.S. beef. In the event that
export markets do not develop, we may not be able to achieve revenue growth as
planned, because there will be little incentive for producers to use our
verification products thus jeopardizing our viability as a profitable entity.
Unless the Japanese market regains its acceptance of U.S. beef, there is a
limited market for our products.
As a result of mad cow disease in at least one animal in the U.S., the Japanese
and Korean beef markets were closed to U.S. Cattle and have been so for a
protracted period except for a few weeks in December 2005 and January 2006 with
the Japanese market. Because the Japanese and Korean markets are the largest
beef export markets for U.S. producers accounting for approximately 37% and 24%
respectively, and because each market requires verification, it is important to
the sale of our products. Because the U.S. market does not mandate verification,
there is limited incentive for beef producers to purchase our products.
Therefore, unless the Japanese market for U.S. beef which just reopened, remains
open and there is again consumer acceptance of U.S. beef, our sales will be
significantly impaired and we will be unable to operate at a profit.
In the event that market demand for beef products declines, our customers may
not be able to generate sufficient revenues to justify purchase of our
verification solutions and consulting services
Public attitudes towards beef may be influenced by claims that beef products are
unsafe for consumption or pose unknown health risks. Decreased demand for beef
products could have a material adverse affect on the operating results and
financial condition of our existing or prospective customers. If operating
results of our customs are impaired, the resources that our customers can devote
to building information systems for tracking cattle and herd management would be
reduced which in turn would limit purchases of our verification solutions and
consulting services. Therefore, our ability to generate revenue is subject to
the risks and uncertainties relating to the financial condition of its
customers.
Our future success depends upon our ability to obtain and enforce patents;
prevent others from infringing on our patents, trademarks and other intellectual
property rights; and operate without infringing upon the patents and proprietary
rights of others.
We will be able to protect our intellectual property from unauthorized use of
third parties only to the extent that it is covered by valid and enforceable
patents and trademarks. We currently have three patents pending with the U.S.
Patent Office, one of which accounts for over 40% of our total revenues. Patent
protection generally involves complex legal and factual issues and, therefore,
the enforceability of patent rights cannot be predicted with certainty.
Moreover, the laws of some foreign countries do not protect proprietary rights
to the same extent as the laws of the United States. In the event that patents
owned by us do not provide adequate protection, we may not be able to prevent
competitors from offering substantially similar products and services. Failure
to protect our proprietary rights could seriously impair our competitive
position.
5
In the event that third parties claim that our current or future products or
services infringe upon their intellectual property, we may face litigation and
be prevented from selling the products and services at issue. Infringement or
other claims could be asserted or prosecuted against us in the future, and it is
possible that past or future assertion or prosecutions could harm our business.
Litigation either in defense of our intellectual property rights or in response
to infringement claims made by others may be, both expensive and time consuming,
which in turn would adversely affect our business.
We operate in a highly competitive industry with a limited market characterized
by changing technology, frequent introductions of new products, product
enhancements, and evolving industry standards.
We compete with many other vendors of products and services designed for
tracking cattle and for herd management. Our competitors range from small
start-up companies to multi-national firms of which there are at least four -
See "Competition" below. These four competitors have significantly greater
financial, technical and marketing resources. Competition is likely to intensify
as current competitors expand their product offerings and as new companies enter
the market. Increasing competition may result in reduced margins and the loss of
market share. Our competitors may offer broader product lines or technologies
that are more commercially attractive and gain greater market acceptance than
our current or future products. Additionally, new technology may render our
products obsolete.
Our future success depends to a significant degree upon the continued service of
key senior management personnel, in particular, John and Leann Saunders.
Both John and Leann Saunders' reputation and prominence in the field provide the
Company with a strong competitive advantage. While they are currently bound by
employment agreements, we can offer investors no assurance that John and or
Leann Saunders will be able to continue to work for us in the event of an
unforeseen accident, severe injury or major disease, or on a long-term basis.
The loss of key personnel could have a material adverse effect on our business
and operating results.
New corporate governance requirements are likely to increase our costs and make
it more difficult to attract qualified directors.
We face new corporate governance requirements under the Sarbanes-Oxley Act of
2002, as well as rules adopted by the Securities and Exchange Commission. We
expect that these laws, rules and regulations will increase our legal and
financial compliance costs and make some activities more difficult,
time-consuming and costly particularly the outside review of our internal
controls. We also expect that these new requirements will make it more difficult
and more expensive for us to obtain director and officer liability insurance. We
may be required to accept reduced coverage or incur significantly higher costs
to obtain coverage. These new requirements are also likely to make it more
difficult for us to attract and retain qualified individuals to serve as members
of our board of directors or committees of the board.
Because we are not presently subject to the same corporate governance standards
as companies listed on registered stock exchanges or NASDAQ, our officers and
Directors may have interests adverse to those of the Shareholders.
Registered stock exchanges and NASDAQ have enhanced corporate governance
requirements that apply to issuers that list their securities on those
exchanges. We plan to apply for the listing of our shares on the OTC Bulletin
Board, which does not have comparable requirements. For instance, we are not
required to have any independent directors or to adopt a code of ethics. In
certain circumstances, management may not have the same interests as the
shareholders and conflicts of interest may arise. We do not presently have a
policy to resolve conflicts of interest. Notwithstanding the exercise of their
fiduciary duties as directors and executive officers and any other duties that
they may have to us or our shareholders in general, these persons may have
interests different than yours which could adversely affect your investment.
6
Risks Related to Owning Our Common Stock
There is limited liquidity on the OTC Bulletin Board which may impact your
ability to sell your shares.
Our shares are quoted on the OTC Bulletin Board. However, merely because a
security is listed on the OTC Bulletin Board does not guaranty that there will
be any trading volume in our shares. When fewer shares of a security are traded
on the OTC Bulletin Board, price volatility may increase and price movement may
outpace the ability of the OTC Bulletin Board to deliver accurate quote
information. If there is low trading volumes in our common stock, there may be a
lower likelihood of orders for shares of our common stock being executed, and
current prices may differ significantly from prices quoted by the OTC Bulletin
Board at the time of order entry.
Our common stock is subject to the penny stock rules which will limit the market
for our common stock and increase the cost of sale because of additional broker
compensation.
The term "penny stock" generally refers to low-priced, speculative securities of
very small companies such as ours. Before a broker-dealer can sell a penny
stock, Securities and Exchange Commission rules require the broker-dealer to
first approve the customer for the transaction and receive from the customer a
written agreement for the transaction. The broker-dealer must furnish the
customer with a document describing the risks of investing in penny stocks. The
broker-dealer must tell the customer the current market quotation, if any, for
the penny stock and the compensation the broker-dealer and its broker will
receive for the trade. Finally, the broker-dealer must send monthly account
statements showing the market value of each penny stock held in the customer's
account. These requirements make penny stocks more difficult to trade and
because of the additional services to be performed by the broker will generally
result in increased commissions and /or a wider spread between the bid and ask
price of the stock. Since our common stock is subject to the penny stock rules,
the market liquidity of our common stock may be adversely affected which could
limit your ability to sell your shares.
There may be a greater risk of fraud on the OTC Bulletin Board.
OTC Bulletin Board securities are frequently targets for fraud or market
manipulation because they are not regulated as closely as securities listed on
exchanges. Dealers may dominate the market and set prices that are not based on
competitive forces. Individuals or groups may create fraudulent markets and
control the sudden, sharp increase of price and trading volume and the equally
sudden collapse of market prices. While there is regulation of the OTC Bulletin
Board, it is not as comprehensive as the regulation of the listed exchange or
NASDAQ. If our shares are listed on the OTC Bulletin Board and this should
occur, the value of an investment in our common stock could decline
significantly.
You could suffer substantial dilution and our stock price could decline if we
issue additional securities in the future or if current holders of our
securities choose to sell a large portion of their holdings at the same time.
Our common stock, may not continue to be traded on the OTC Bulletin Board which
may make it more difficult to sell your shares.
We cannot provide any assurance that our common stock will continue to trade on
the OTC Bulletin Board. To retain our listing, our required SEC reports must be
timely filed. There can be no guarantee that our reports will be timely filed,
as delays in their filing may be beyond our control, such as a dispute with the
auditor or the unavailability of required information. Should our common stock
cease to trade on the OTC Bulletin Board and fail to qualify for listing on
another stock exchange or trading system, our common stock would be listed for
trading only on the "Pink Sheets," which generally provide an even less liquid
market than the OTC Bulletin Board. In such event, shareholders may find it more
difficult to trade our common stock or to obtain accurate, current information
concerning market prices for our common stock, all of which would have a
negative effect on the value of your shares.
We do not plan to pay dividends on our common stock.
We do not anticipate paying cash dividends to the holders of our common stock in
the foreseeable future. Accordingly, investors in our common stock must rely
upon subsequent sales after price appreciation as the sole method to realize a
gain on an investment in our common stock. There are no assurances that the
price of our common stock will ever appreciate in value particularly if we
continue to sustain operating losses. Investors seeking cash dividends should
not buy our common stock.
7
It can be difficult to edit or cancel orders on the OTC Bulletin Board, which
may impair your ability to sell our common stock at a favorable price.
Orders for OTC Bulletin Board securities may be canceled or edited like orders
for other securities. All requests to change or cancel an order must be
submitted to, received and processed by the OTC Bulletin Board. Due to the
manual order processing involved in handling OTC Bulletin Board trades, order
processing and reporting may be delayed. As a result, it may not be possible to
edit orders. Consequently, it may not be possible to sell our common stock at a
favorable price.
Increased dealer compensation could adversely affect the price of our common
stock.
If our shares are listed on the OTC Bulletin Board, the dealer's spread (the
difference between the bid and ask prices) may be larger than that for shares
traded on an exchange, and may result in substantial losses to the seller of
shares of our common stock on the OTC Bulletin Board if such stock must be sold
immediately. Further, purchasers of our shares of common stock may incur an
immediate "paper" loss due to the price spread. Moreover, dealers trading on the
OTC Bulletin Board may not have a bid price for shares of our common stock on
the OTC Bulletin Board due to the foregoing, demand for the shares of our common
stock on the OTC Bulletin Board may be decreased or eliminated.
FORWARD-LOOKING STATEMENTS
This prospectus contains certain forward-looking statements, including
information about or related to our future results, certain projections and
business trends. Assumptions relating to forward-looking statements involve
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. When
used in this prospectus, the words "estimate," "project," "intend," "believe,"
"expect" and similar expressions are intended to identify forward-looking
statements. Although we believe that our assumptions underlying the
forward-looking statements are reasonable, any or all of the assumptions could
prove inaccurate, and we may not realize the results contemplated by the
forward-looking statements. Management decisions are subjective in many respects
and susceptible to interpretations and periodic revisions based upon actual
experience and business developments, the impact of which may cause us to alter
our business strategy or capital expenditure plans that may, in turn, affect our
results of operations. In light of the significant uncertainties inherent in the
forward-looking information included in this prospectus, you should not regard
the inclusion of such information as our representation that we will achieve any
strategy, objectives or other plans. The forward-looking statements contained in
this prospectus speak only as of the date of this prospectus, and we have no
obligation to update publicly or revise any of these forward-looking statements.
These and other statements, which are not historical facts, are based
largely upon our current expectations and assumptions and are subject to a
number of risks and uncertainties that could cause actual results to differ
materially from those contemplated by such forward-looking statements. These
risks and uncertainties include, among others, our planned effort to redeploy
our assets and use our cash and cash equivalent assets to enhance stockholder
value following the sale of substantially all of our electronic commerce
business, which represented substantially all of our revenue generating
operations and related assets, and the risks and uncertainties set forth in the
section headed "Risk Factors" of this prospectus. The Company cannot guarantee
its future performance.
INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated by reference into this
Registration Statement and are made a part hereof:
(a) The Company's Registration Statement on Form SB-2 originally
filed on April 27, 2006 and all subsequent amendments thereto.
(b) All other reports filed pursuant to Section 13(a) or 15(d) of
the Exchange Act since the end of the fiscal year covered by
the Annual Report referred to in Item 3(a) above, including,
but not limited to, the Company's quarterly reports on Form
10-QSB through the fiscal quarter ended September 30, 2006 and
all Form 8-K.
8
All reports and other documents subsequently filed by the Company
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, as amended, prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of the filing of such
reports and documents.
ORGANIZATION WITHIN THE LAST FIVE YEARS
Integrated Management Information, Inc. was incorporated in 1998 as a Missouri
corporation. In March, 2005, we reincorporated in Delaware and in April 2006
we redomiciled to Colorado.
Until December 31, 2004 we operated as a Subchapter S corporation under the
Internal Revenue Code of 1986, as amended, with any income or loss passed
through to the shareholders for income tax purposes. Beginning January 1, 2005
we converted to a Subchapter C corporation and became subject to income
taxation.
Description of Business
Overview and Business Development
We were organized to apply information technology and electronic documentation
management to the livestock industry by addressing the growing importance to the
industry (producers, processors, and customers) of detailed information
regarding identification, traceability, and verification of marketing claims
such as: source of origin information, genetic background, animal treatment,
animal health history, animal age, animal movements, nutrition, and other
credence attributes (those claims made that can not be confirmed by visual
inspection once the product reaches the meat case and is marketed to the
consumer). To address this demand, we developed a range of proprietary web based
applications, consulting methodologies, auditing processes, and other services
to allow the livestock industry to record, manage, report, and audit this
information.
In May 2005, we acquired certain assets and liabilities of Cattlefeeding.com,
Inc., an entity which operated Cattenetwork.com, an internet-based online
service providing news and information about the North American cattle industry.
Cattlenetwork.com contributes revenues from its e-commerce activities
(Cattlestore.com) and advertising.
Industry Background
As the cattle livestock industry has matured and expanded internationally, there
has been an increasing need to record, manage, report and audit information
regarding the source, age, genetic background, nutrition, and other credence
attributes of livestock for the benefit of producers, processors, distributors,
retailers, consumers, and regulators.
Demand for livestock identification, traceability and verification solutions
further accelerated in recent years due to industry and consumer concerns
regarding bovine spongiform encephalopathy (mad cow disease) governmental and
industry regulations regarding recordkeeping for livestock, and technology, and
technology advances, including radio frequency ID tags for livestock and
web-based systems facilitating real-time data entry and reporting.
Many of the world's largest beef exporting countries, including Brazil,
Argentina, and Australia, have established mandatory traceability and
verification standards. Other countries have issued voluntary animal
identification and traceability standards. The United States lags with regards
to meeting this market demand, as the United States government has not to date
established voluntary or mandatory traceability and verification standards.
Currently, the Agriculture and Plant Health Inspection Services Agency ("APHIS")
is working on the development of recommended voluntary animal identification and
traceability standards. However, the estimated time for launch is not until
January 2009.
To support industry driven marketing programs and to comply with regulations
established by international export partners, the United States Department of
Agriculture ("USDA"), Agriculture Marketing Service, Audit, Review and
Compliance Branch has established the voluntary Quality System Assessment, Non
Hormone Treated Cattle, and Process Verified programs based on ISO 9000
Standards. These programs provide guidelines and structure to enable suppliers
of agricultural products and services to assure customers of their ability to
provide consistent quality products or services by having their processes
audited by independent, third-party audits using USDA approved methodologies and
standards.
9
The USDA's Quality System Assessment (QSA) program is a documented quality
management system and verification trail that can support specific product
claims or customer requirements, as well as confirm compliance with export
standards. The approved QSA must show that characteristics of the product are
being monitored and measured accurately. Approved QSA programs are audited by
the USDA at least twice per year.
The USDA's Process Verified Program ("PVP") is similar to the QSA program, but
broader in scope. Like the QSA, PVP ensures that companies deliver products that
meet stated product claims. In addition, it provides beef suppliers with a
verifiable marketing tool. Once marketing claims are verified by the USDA, the
company may use the "USDA Process Verified" shield on its marketing materials.
Both Quality Systems Assessment and Process Verification Programs are applicable
to a company's entire program or certain portions of its programs where
specified producer or product requirements are supported by a document quality
management system and the documented delivery processes are verified through an
independent, third party audit. To operate an approved program, suppliers must
submit a documented quality management system to the Audit Review and Compliance
Branch of the USDA Livestock and Seed Program and successfully pass a document
review and an on-site audit.
Within the United States, these USDA programs are voluntary and are primarily
useful in providing the industry with a process for demonstrating source, age,
and quality attributes as the product moves through the supply chain. In
addition, compliance with the programs allows producers to verify claims such as
"all natural," "non-hormone treated," or "guaranteed tender."
To market beef products outside of the United States, suppliers must comply with
the QSA and PVP policies and procedures and address the specified product
requirements addressed in the USDA Export Verification ("EV") Program specific
to each country. Regardless of final export destination or specific Export
Verification program requirements, US suppliers seeking to sell beef products
must participate in a pre-approved Quality System Assessment so as to have an
approved means of verifying source, age, and other specific product
requirements. Therefore, though the program is voluntary, it is mandatory to
gain access to export markets.
To market beef products in Japan, Mexico, South Korea, Canada and Europe, the
world's largest export markets, beef is required to be sourced from cattle that
are of a certain maximum age at the time of slaughter. The USDA QSA program is
the standard mechanism for verifying source and age for these export markets
and, therefore, is a mandatory requirement for producers, packers, and
distributors to sell beef products for export to these key markets.
These export markets represent a significant opportunity for the US cattle
industry. Prior to the discovery of the first case of mad cow disease in the US
in December 2003, the USDA estimated that the industry exported approximately
$2.8B to Japan, Mexico, South Korea, and Canada. The governments of these and
other countries responded to the discovery by forbidding import of beef from the
US, and exports to these countries fell to approximately $0.4B during 2004. In
large part because of implementation of the USDA QSA initiatives export
partners' confidence in the US cattle supply increased, and many key export
markets reopened, including Mexico, Hong Kong, Singapore, and Taiwan. In
December 2005, Japan lifted its ban on imported US beef, but reinstated it in
January 2006 after an inspection revealed a case of non-compliance with the
Japanese import regulations. Current beef consumption within the US has not
changed over the past 20 years, while the productivity of the US beef industry
continues to improve. Therefore, international market access and growth is
critical for the US beef industry. Future growth opportunities for US protein
lie in consumption growth internationally, as only 2% of the world's population
resides in the US. As of July 27, 2006, the Japanese market has reopened as has
the Canadian, Mexican and European commodity markets. The Korean and Chinese
markets remain closed.
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The opportunity to participate in export markets presents a strong indicator of
potential demand for approved verification processes, which have become
essential. However, during the time in which the export markets are closed,
demand for solutions to comply with these regulatory requirements is
constrained.
The Business
To address the livestock industry's requirements to deploy and maintain
identification, traceability, and verification systems and to facilitate
participation in and compliance with the USDA's Quality System Assessment,
Process Verification, and Beef Export Verification Programs, we have developed
and offer a balanced portfolio of products and services. These solutions address
specific requirements at each level of the livestock supply chain. In addition,
we offer customized solutions to address unique customer requirements. We
complement these products and services with our Cattlenetwork.com and
Cattlestore.com industry information services and internet portals.
Our product and services offerings are described in further detail below.
USVerified
We offer a range of products and services under our USVerified brand to track,
record, manage, report, and audit key data regarding livestock. Our offerings
address the needs of each industry segment, and our customers span the supply
chain from birth through the various stages of feeding and raising the
livestock, to packing and distribution. We have no principal suppliers because
most of our revenue is service related. What products we do purchase
(principally cattle identification ear tags) we purchase from Allflex and
Digital Angel. However, there are numerous other companies which manufacture and
market such ear tags.
Our USVerified products and services offerings are tailored to the needs of each
level of the beef supply chain in support of USDA programs:
Suppliers (Cow/Calf Producers)
SupplyVerified is a consulting and auditing service offered to cattle suppliers
that enables them to demonstrate their ability to efficiently and accurately
track key data related to the source and age of cattle. The USDA has informed us
that our SupplyVerified program was the industry's first USDA approved offsite
evaluation process for cattle suppliers to meet requirements under the USDA's
Quality Systems Assessment (QSA) program.
Under the SupplyVerified program, suppliers provide documentation to us about
their processes for compliance with the QSA program. This documentation is
evaluated and audited by us and, if warranted, we provide a certificate that the
producer meets the requirements of source and age verification. We charge each
cattle supplier a fixed annual fee for performing the audit and providing the
certification. In order to maintain QSA certification, a supplier must
participate in the annual audits.
Based on the State of the Industry Report 2004 published by Primedia, the USDA
estimates that there are approximately 792,050 independent suppliers of cattle
in the United States, of which approximately 5,330 have herds of at least 500
head.
Feed Yards
We offer solutions to enable feed yards to comply with USDA's QSA requirements.
Initially, we work with the feed yard to implement the required systems and
procedures to track key data regarding the cattle that move through the
operation, including source and age as well as additional health and nutritional
information. This service is provided and priced to feed yards on a packaged
basis, which includes access to our proprietary web based applications and
processes, completion of a USDA program compliant manual, obtaining USDA
approval, implementation services, and initial training. In addition, we offer a
monthly service to maintain the USDA compliant manual and web host the data.
Based on the State of the Industry Report 2004 published by Primedia, there are
approximately 93,000 independent feed yards in the United States with
approximately 2,200 having capacity of at least 1,000 heads.
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Packers
We offer solutions to meat packers, processors and distributors to demonstrate
that their products comply with USDA's QSA requirements, Export Verification
("EV") requirements as well as the USDA's Process Verified Program ("PVP"),
which is broader in scope than the QSA program. Suppliers with approved USDA
Process Verified Programs are able to make marketing claims associated with
their process verified points -- such as age, source, feeding practices, or
other raising and processing claims - and market themselves as "USDA Process
Verified." This service is provided and priced to meat packers on a packaged
basis, which includes access to our Proprietary web based applications and
processes, completion of a USDA program compliant manual, obtaining USDA
approval, implementation services, and initial training. In addition, we offer a
monthly service to maintain the USDA compliant manual and web host the data.
According to the most recent Packers & Stockyards data, in 2004 there were 689
federally inspected slaughter plants in the U.S. The top 4 firms slaughtered 69%
of the total.
For the year ended December 31, 2005 our US Verified Programs provided
approximately 42% of our revenue.
Consulting
In addition to our standard product offerings, we offer consulting and web-based
development on a customized basis to meet special customer requirements. For the
year-ended December 31, 2005, such services constituted approximately 27% of our
total revenue.
Hardware
In support of these proprietary product and service offerings, we offer hardware
products (primarily radio frequency identification cattle tags) to our
customers. While these hardware products have lower profit margins compared with
our proprietary offerings, they allow us to offer our customers a comprehensive
solution. Approximately fourteen percent (14%) of our revenue was provided by
the sale of hardware during the year-ended December 31, 2005.
Internet-Based Online Services
We own and operate Cattlenetwork.com, an internet-based online service providing
news and information about the North American cattle industry and
Cattlestore.com, an e-commerce site for customers to purchase a wide range of
products and supplies related to agriculture. This business was acquired in May
2005. Prior to this acquisition, we did not offer any internet based online
services.
According to Alexa Internet, an information service that tracks and analyzes
website traffic, Cattlenetwork.com is the second largest online source of news
and information regarding the North American cattle industry.
We derive revenue from our internet-based online service offerings through a
combination of advertising sales to companies seeking to reach Cattlenetwork's
unique base of readers and sales of products through Cattlestore.com. Internet
Sales and advertising generated approximately twelve (12) percent of our revenue
for the year-ended December 31, 2005.
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Sales and Marketing
We sell our USVerified products and services directly to customers at various
levels in the livestock supply chain. This program was formally launched in June
of 2005 and represented a new line of business for the Company. Our largest
customers are Smithfield, the largest U.S. pork packer and fifth largest beef
packer; National Beef, the fourth largest U.S. beef packer; Harris Ranch; PM
Beef Group; Creekstone Foods; US Premium Beef; America's Best Pork; Cargill Meat
Solutions; Meyer Natural Angus; Land O Lakes; Purina Mills; Visa Trace; Walco
Animal Health; Schering Plough Animal Health; Merial Corporation; Superior
Livestock Marketing; The Beef Marketing Group; Angus GeneNet; Montana Branded
Beef Association; Origen; the Missouri Department of Agriculture; the Missouri
Veterinary Medical Association. No single customer generates more than 10% of
our revenue.
Our marketing strategy includes direct marketing, advertising, event
sponsorship, and trade show participation. From a public relations perspective,
our staff is frequently quoted in industry trade journals and requested as
speakers at various industry events as subject matter experts on the topics of
animal identification, traceability, and the USDA QSA, EV and PVP programs. We
maintain strong affiliations with the Beef Information Exchange, US Meat Export
Federation, National Cattlemen's Beef Association, and Livestock Marketing
Association.
In order to reach additional customers, we are developing strategic marketing
partnerships with leading companies in the industry with complementary abilities
and products. In February 2006, we entered into two strategic alliances:
* We announced a marketing agreement with Merial, Ltd. Under this agreement,
Merial will offer our USVerified source and age verification solutions to cattle
producers together with Merial's SUREHEALTH calf preconditioning program.
* We entered into an agreement with Superior Livestock, under which we will
assist Superior Livestock in establishing a branded QSA compliant program,
Superior Verified. Under this agreement, we will offer certification and
auditing solutions to Superior Livestock's cattle producers.
We do not currently rely on any third party contracts with distributors,
licenses or manufacturers in conducting our business.
Competition
Of the 792,050 independent suppliers of cattle in the United States, we estimate
that only approximately 40,000 use some form of verification program. We
currently provide tracking information for approximately 1,500 of these
independent suppliers. Our system is a paper based system which does not require
the use of a computer. All of the systems of our competitors require computer
applications. Due to lack of computerized technology and accessibility at the
supplier level, the paper based system utilizing a fax machine has gained wider
acceptance. The remote transmittal of information by fax allows us to provide
off-site evaluations. This reduces travel expenses and costs. Our system allows
for offsite servicing (the review of the faxed information by our auditors and
telephone verification) coupled with on site sample audits. All of our
competitors require on site inspection. Our other advantage, to the best of our
knowledge, is that our competitors do not offer a USDA approved program to
feedlots and packers and therefore those that use our program also create
additional opportunity with the cattle suppliers to utilize our verification
(Supply Verify) program.
Our key competitors are:
AgInfolink, a privately held global information technology company that develops
traceability tools for the world's food supply. In 2005, this company also
acquired the business operations of Animal Permanent Electronic Identification
Systems, Inc., a provider of animal traceability solutions to cattle producers
in the central plains and Montana. AgInfolink competes with us on our Supplied
Verify Program. We estimate that AgInfolink has less than 1,000 customers.
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eMerge Interactive, Inc., a technology company serving the agricultural food
service and healthcare industries. Its two principal business focuses are food
safety technology and livestock management principally through its Inspection
Control and Cattlelog Animal Information Systems. eMerge competes with us on our
Supplied Verify Program. We estimate that eMerge has less than 1,000 customers.
MicroBeef Technologies, is a manufacturer of computerized real-time management
systems for the beef industry. Its management systems include marketing
management, information systems, nutrition programs and health administration.
They also have a verification program, ECM, which competes with our Supply
Verified Program. We estimate that MicroBeef has less then 500 customers.
Sterling Solutions, an affiliate of Sterling Marketing, Inc., offers market
driven source verification programs designed for simplicity and compliance with
domestic and international standards. Sterling Solutions is a USDA Process
Verification Program which competes with our Supply Verified Program. We
estimate that Sterling has approximately 150 customers.
Pricing
IMI believes that the following is the current pricing for each company's supply
verification program.
a) AgInfolink - $4.00 per animal b) eMerge - $3.50 per animal c) MicroBeef - $7
per animal d) Sterling - $12 per animal
e) IMI - Flat rate of $150 regardless of the number of animals
Intellectual Property
We have three patents pending: Serial No. 10/278,876 - Information system and
method for gathering information relating to livestock; Serial No. 10/462,169 -
Livestock pricing system; Serial No. 11/190, 245 - Computer program and method
for establishing, documenting, implementing and maintaining a quality management
system for quality systems assessment and product verification programs.
We have been granted a trademark for Passport to Profitability, Beef Passport
and Grid Max. We have filed trademark applications for Chuteside, Web
Integrator, US Verified, IMI Global, the IMI Logo, Cattlenetwork and
Cattlestore.
Employees
As of December 31, 2005, we had thirteen (13) employees all of which are
full-time. As of September 15, 2006 we have fifteen (15) employees, all of which
are full-time.
DESCRIPTION OF PROPERTIES
We lease approximately 2,415 square feet of office space in a two story building
in Platte City, Missouri. Our lease expires on January 31, 2008. Our rent for
the facility in Platte City, Missouri is $1,550 per month.
We lease approximately 3,100 square feet of office space in a one story office
facility in Castle Rock, Colorado which is used as our corporate headquarters.
Our lease expires on June 18, 2011. Our rent for the facility, including
expenses, in Castle Rock, Colorado is $4,973 per month.
USE OF PROCEEDS
The Company will not realize any proceeds from the sale of the common stock
which may be sold pursuant to this prospectus for the respective accounts of the
Selling Stockholders. The Company, however, will derive proceeds upon the
exercise of the options and/or Warrants granted to the Selling Stockholders. All
such proceeds will be available to the Company for working capital and general
corporate purposes. No assurances can be given, however, as to when or if any or
all of the options will be exercised.
14
SELLING STOCKHOLDERS
This prospectus relates to Shares that are being registered for reoffers
and resales by Selling Stockholders who have acquired or may acquire Shares
pursuant to each of the Plans. The Selling Stockholders may resell any or all of
the Shares at any time they choose while this prospectus is effective.
Executive officers and directors, their family members, trusts for their
benefit, or entities that they own, that acquire common stock under the Plans
may be added to the Selling Stockholder list below by a prospectus supplement
filed with the Commission. The number of Shares to be sold by any Selling
Stockholder under this prospectus also may be increased or decreased by a
prospectus supplement. Non-affiliates who purchased restricted securities, as
these terms are defined in rule 144(a) under the Securities Act, under any of
our employee benefit plans and who are not named below may use this prospectus
for the offer or sale of their common stock if they hold 1,000 shares or less.
Although a person's name is included in the table below, neither that person nor
we are making an admission that the named person is our "affiliate."
Each of the Selling Stockholders is an employee of or consultant to the
Company. The following table sets forth:
* the name and principal position or positions over the past three years with
the Company of each Selling Stockholder;
* the number of shares of common stock each Selling Stockholder beneficially
owned as of January 1, 2007
* the number of shares of common stock acquired by each Selling Stockholder
in connection with stock options and stock grants pursuant to the Plans and
being registered under this Registration Statement, some or all of which
shares may be sold pursuant to this prospectus; and
* the number of shares of common stock and the percentage, if 1% or more, of
the total class of common stock outstanding to be beneficially owned by
each Selling Stockholder following this offering, assuming the sale
pursuant to this offering of all shares acquired by such Selling
Stockholder in connection with grants pursuant the Plans and registered
under this Registration Statement.
There is no assurance that any of the Selling Stockholders will sell any
or all of the shares offered by them under this Registration Statement. The
address of each Selling Stockholder is 221 Wilcox, Suite A, Castle Rock, CO
80104.
Name of Seller Number of Shares Number of Shares to
- -------------- Position Beneficially Shares to be be Beneficially Owned
Owned (1) Sold After the Offering (2)
Cory Weaver Vice President 50,000 712,500 50,000
Jim Norwood 30,000 112,500 30,000
Eric Kelton 42,048 75,000 42,048
Dusty Markam Asst. Vice President 50,000 75,000 50,000
Cara Gerken Vice President 50,000 75,000 50,000
Rob Cook Director-Cattlenetwork - 75,000 -
Rob Streight Vice President - 75,000 -
Keith Belk 30,000 37,500 30,000
Warren Gfeller - 37,500 -
Emily Saunders 20,000 37,500 20,000
Melinda Birkeland 20,000 37,500 20,000
Rod Bowling 30,000 37,500 20,000
Doug Stanton 50,000 37,500 50,000
Gary Smith Director 50,000 37,500 50,000
Mark McGregor Chief Financial Officer - 1,650,000 -
1) Based on share ownership as of January 1, 2007. As used in this
table, a beneficial owner of a security includes any person who,
directly or indirectly, through contract, arrangement, understanding,
relationship or otherwise has or shares (a) the power to vote, or
direct the voting of, such security or (b) investment power which
includes the power to dispose, or to direct the disposition of, such
security. In addition, a person is deemed to be the beneficial owner
of a security if that person has the right to acquire beneficial
ownership of such security within 60 days.
15
2) Assumes the sale of all shares being registered by this Prospectus.
DESCRIPTION OF COMMON STOCK
The following description is a summary and is qualified in its entirety by the
provisions of our Articles of Incorporation and Bylaws, copies of which have
been filed as exhibits to the registration statement of which this prospectus is
a part.
Common Stock
Our Articles of Incorporation authorize us to issue up to 95,000,000 common
shares, $0.001 par value per share and 5,000,000 shares of preferred stock,
$0.001 par value. As of November15, 2006, we had 17,867,515 shares of common
stock outstanding held by our stockholders. No shares of preferred stock have
been issued.
Liquidation Rights
Upon liquidation or dissolution, each outstanding common share will be entitled
to share equally in our assets legally available for distribution to
stockholders after the payment of all debts and other liabilities.
Dividend Rights
There are no limitations or restrictions upon the rights of our Board of
Directors to declare dividends, and we may pay dividends on our shares in cash,
property, or our own shares, except when we are insolvent or when the payment
thereof would render us insolvent subject to the provisions of the Delaware
Statutes. We have not paid dividends in the past and it is not anticipated that
any dividends will be paid in the foreseeable future.
Voting Rights
Holders of our common shares are entitled to cast one vote for each share held
at all stockholders meetings for all purposes. There are no cumulative voting
rights.
Other Rights
Our common shares are not redeemable, have no conversion rights and carry no
preemptive or other rights to subscribe to, or purchase, additional common
shares in the event of a subsequent offering. There are no other material rights
of the common stockholders not included herein. There is no provision in our
charter or by-laws that would delay, defer or prevent a change in control of
IMI. We have not issued any debt securities. Each stockholder of IMI will
receive an annual report, including audited financial statements. IMI is a
reporting company and files quarterly reports on Form 10-QSB and annual reports
on Form 10-KSB.
PLAN OF DISTRIBUTION
The Selling Stockholders may use any one or more of the following methods
when disposing of shares or interests therein:
* market transactions in accordance with the rules of the OTC Bulletin Board
Electronic Quotation Service or any other available markets or exchanges;
* ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
16
* block trades in which the broker-dealer will attempt to sell the shares as
agent, but may position and resell a portion of the block as principal to
facilitate the transaction;
* purchases by a broker-dealer as principal and resale by the broker-dealer
for its account;
* an exchange distribution in accordance with the rules of the applicable
exchange;
* privately negotiated transactions;
* short sales entered into after the date of this prospectus;
* through the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;
* distributions to the partners and/or members of the Selling Stockholders;
* redemptions or repurchases of interests owned by partners and/or members of
the Selling Stockholders;
* broker-dealers may agree with the Selling Stockholders to sell a specified
number of such shares at a stipulated price per share;
* a combination of any such methods of sale; and
* any other method permitted pursuant to applicable law.
In connection with the sale of our common stock or interests therein, the
Selling Stockholders may enter into hedging transactions with broker-dealers or
other financial institutions, which may in turn engage in short sales of our
common stock in the course of hedging the positions they assume with the selling
stockholders. The Selling Stockholders may also sell shares of our common stock
short and deliver these securities to close out their short positions, or loan
or pledge our common stock to broker-dealers that in turn may sell these
securities. The Selling Stockholders may also enter into option or other
transactions with broker-dealers or other financial institutions or the creation
of one or more derivative securities which require the delivery to such
broker-dealer or other financial institution of shares offered by this
prospectus, which shares such broker-dealer or other financial institution may
resell pursuant to this prospectus (as supplemented or amended to reflect such
transaction).
Short selling occurs when a person sells shares of stock which the person
does not yet own and promises to buy stock in the future to cover the sale. The
general objective of the person selling the shares short is to make a profit by
buying the shares later, at a lower price, to cover the sale. Significant
amounts of short selling, or the perception that a significant amount of short
sales could occur, could depress the market price of our common stock. In
contrast, purchases to cover a short position may have the effect of preventing
or retarding a decline in the market price of our common stock, and together
with the imposition of the penalty bid, may stabilize, maintain or otherwise
affect the market price of our common stock. As a result, the price of our
common stock may be higher than the price that otherwise might exist in the open
market. If these activities are commenced, they may be discontinued at any time.
These transactions may be effected on the OTC Pink Sheets Electronic Quotation
Service or any other available markets or exchanges.
The aggregate proceeds to the Selling Stockholders from the sale of our
common stock offered by them will be the purchase price of our common stock less
discounts or commissions, if any. Each of the Selling Stockholders reserves the
right to accept and, together with their agents from time to time, to reject, in
whole or in part, any proposed purchase of our common stock to be made directly
or through agents. We will not receive any of the proceeds from this offering.
The Selling Stockholders also may resell all or a portion of the shares in
open market transactions in reliance upon Rule 144 under the Securities Act,
provided that they meet the criteria and conform to the requirements of that
rule.
17
The Selling Stockholders and any underwriters, broker-dealers or agents
that participate in the sale of our common stock or interests therein may be
"underwriters" within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profits they earn on any resale of the
shares may be underwriting discounts and commissions under the Securities Act.
Selling Stockholders who are "underwriters" within the meaning of Section 2(11)
of the Securities Act will be subject to the prospectus delivery requirements of
the Securities Act.
To the extent required, the shares of our common stock to be sold, the
names of the Selling Stockholders, the respective purchase prices and public
offering prices, the names of any agents, dealers or underwriters, any
applicable commissions or discounts with respect to a particular offer will be
set forth in an accompanying prospectus supplement or, if appropriate, a
post-effective amendment to the registration statement that includes this
prospectus.
In order to comply with the securities laws of some states, if applicable,
our common stock may be sold in these jurisdictions only through registered or
licensed brokers or dealers. In addition, in some states our common stock may
not be sold unless it has been registered or qualified for sale or an exemption
from registration or qualification requirements is available and is complied
with.
We have advised the Selling Stockholders that the anti-manipulation rules
of Regulation M under the Exchange Act may apply to sales of shares in the
market and to the activities of the Selling Stockholders and their affiliates.
In addition, we will make copies of this prospectus (as it may be supplemented
or amended from time to time) available to the Selling Stockholders for the
purpose of satisfying the prospectus delivery requirements of the Securities
Act. The Selling Stockholders may indemnify any broker-dealer that participates
in transactions involving the sale of the shares against certain liabilities,
including liabilities arising under the Securities Act.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Exchange Act, and
in accordance therewith we are required to file periodic reports, proxy
statements and other information with the Commission. Such reports, proxy
statements and other information filed by us can be inspected and copied at the
Commission's Public Reference Room located at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, at the prescribed rates. The Commission also maintains a
site on the World Wide Web that contains reports, proxy and information
statements and other information regarding registrants that file electronically.
The address of such site is http://www.sec.gov. Please call 1-800-SEC-0330 for
further information on the operation of the Commission's Public Reference Room.
Our common stock is quoted on the OTC Bulletin Board under the symbol
"INMG:OB."
With respect to our common stock, this prospectus omits certain
information that is contained in the registration statement on file with the
Commission, of which this prospectus is a part. For further information with
respect to us and our common stock, reference is made to the registration
statement, including the exhibits incorporated therein by reference or filed
therewith. Statements herein contained concerning the provisions of any document
are not necessarily complete and, in each instance, reference is made to the
copy of such document filed as an exhibit or incorporated by reference to the
registration statement. The registration statement and the exhibits may be
inspected without charge at the offices of the Commission or copies thereof
obtained at prescribed rates from the public reference section of the Commission
at the addresses set forth above.
You should rely on the information contained in this prospectus and in the
registration statement as well as other information you deem relevant. We have
not authorized anyone to provide you with information different from that
contained in this prospectus. This prospectus is an offer to sell, or a
solicitation of offers to buy, securities only in jurisdictions where offers and
sales are permitted. The information contained in this prospectus is accurate
only as of the date of this prospectus, regardless of the time of delivery of
this prospectus or any sale or exchange of securities, however, we have a duty
to update that information while this prospectus is in use by you where, among
other things, any facts or circumstances arise which, individually or in the
aggregate, represent a fundamental change in the information contained in this
prospectus or any material information with respect to the plan of distribution
was not previously disclosed in the prospectus or there is any material change
to such information in the prospectus. This prospectus does not offer to sell or
solicit any offer to buy any securities other than our common stock to which it
relates, nor does it offer to buy any of these securities in any jurisdiction to
any person to whom it is unlawful to make such offer or solicitation in such
jurisdiction.
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INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the shares of IMI common stock offered by this prospectus will
be passed on by Vanderkam & Associates, as counsel to IMI Hank Vanderkam,
Vanderkam & Associates owns no shares, nor does anyome else in the firm. In
addition, neither he nor anyone else in the firm has been granted options or
warranties in IMI.
RESALE PROSPECTUS
INTEGRATED MANAGEMENT INFORMATION, INC.
Shares of Common Stock, par value $0.001 per share
February 14, 2007
No dealer, salesperson or other person is authorized to give any information or
to represent anything not contained in this prospectus. You must not rely on any
unauthorized information or representations. This prospectus is an offer to sell
only the shares offered hereby, but only under circumstances and in
jurisdictions where it is lawful to do so. The information contained in this
prospectus is current only as of its date.
PART II
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Articles of Incorporation, eliminate the personal
liability of directors to the Company or its stockholders for monetary damages
for breach of fiduciary duty to the extent permitted by Colorado law. The
Company's Bylaws provide that the Company shall have the power to indemnify its
officers and directors to the extent permitted by Colorado law. Colorado law
authorizes a corporation to indemnify directors, officers, employees or agents
of the corporation in non-derivative suits if such party acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best interest
of the corporation and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his conduct was unlawful, as determined in
accordance with Colorado law.
The provisions affecting personal liability do not abrogate a
director's fiduciary duty to the Company and its shareholders, but eliminate
personal liability for monetary damages for breach of that duty. The provisions
do not, however, eliminate or limit the liability of a director for failing to
act in good faith, for engaging in intentional misconduct or knowingly violating
a law, for authorizing the illegal payment of a dividend or repurchase of stock,
for obtaining an improper personal benefit, for breaching a director's duty of
loyalty, which is generally described as the duty not to engage in any
transaction which involves a conflict between the interest of the Company and
those of the director, or for violations of the federal securities laws.
The provisions regarding indemnification provide, in essence, that the
Company will indemnify its directors against expenses (including attorneys
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred in connection with any action, suit or proceeding arising out of the
director's status as a director of the Company, including actions brought by or
on behalf of the Company (shareholder derivative actions). The provisions do not
require a showing of good faith. Moreover, they do not provide indemnification
for liability arising out of willful misconduct, fraud, or dishonesty, for
"short-swing" profits violations under the federal securities laws, for the
receipt of illegal remuneration or if the director received a benefit in money,
property or services to wich the director is not legally entitled. The
provisions also do not provide indemnification for any liability to the extent
such liability is covered by insurance.
The provisions also limit or indemnify against liability resulting from
grossly negligent decisions including grossly negligent business decisions
relating to attempts to change control of the Company.
EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
19
EXHIBITS
4.1 2005 Stock Option Plan
4.2 2006 Equity Incentive Plan
5.1 Opinion and consent of Vanderkam & Associates re: the legality
of the shares being registered
23.1 Consent of Vanderkam & Associates (included in Exhibit 5.1)
23.2 Consent of E. Randall Gruber, CPA, P.C.
UNDERTAKINGS
(a) The registrant hereby undertakes:
(1) To file, during any period in which offers or sells
are being made, a post-effective amendment to this
registration statement to include any material
information with respect to the plan of distribution
not previously disclosed in the registration
statement or any material change to such information
in the registration statement.
(2) That, for the purpose of determining liability under
the Securities Act of 1933, each post-effective
amendment shall be treated as a new registration
statement of the securities offered, and the offering
of the securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To file a post-effective amendment to remove from
registration any of the securities that remain unsold at
the end of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission 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 the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
20
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 for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Castle Rock, CO on the 14th day of February 2007.
INTEGRATED MANAGEMENT CORPORATION
By: /s/ John Saunders
------------------------
John Saunders, President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
Signatures Title Date
/s/ John K. Saunders March 7, 2007
- --------------------
John Saunders Chairman, President and Director
/s/ Dr. Gary Smith March 7, 2007
-----------------
Dr. Gary Smith CEO and Director
/s/ Adam Larson
- ------------------
Adam Larson Director March 7, 2007
/s/ John W. Bellinger
- -------------------
John W. Bellinger Director March 7, 2007
21
Vanderkam & Associates
1301 Travis, #1200
Houston, TX 77002
713-547-8900 phone
713-547-8910 facsimile
March 7, 2007
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Integrated Management Corporation.
Registration Statement on Form S-8
Gentlemen:
We have acted as special counsel to Integrated Management Corporation., a
Nevada corporation (the "Company"), in connection with the preparation of a
Registration Statement on Form S-8 (the "Registration Statement") pertaining to
the registration by the Company under the Securities Act of 1933, as amended, of
an aggregate of 6,112,500 shares (the "Shares") of the Company's common stock
(the "Common Stock"), $0.001 par value per share, pursuant to (i) the Company's
2005 Stock Option Plan 1,462,500 shares (ii) the 2006 Equity Incentive Plan
(3,000,000 shares) collectively referred to herein as the "Plans" and (iii)
1,650,000 shares underlying options issued to the CFO under an employment
contract.
We have made such legal and factual examinations and inquiries, including
an examination of originals or copies certified or otherwise identified to our
satisfaction of such documents, corporate records and instruments, as we have
deemed necessary or appropriate for purposes of this opinion. In our
examination, we have assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals, and the conformity to authentic
original documents of all documents submitted to us as copies.
We have relied, without independent investigation, upon a certificate from
the Company's Chief Executive Officer as to certain factual and other matters
including that the number of shares which the Company is authorized to issue in
its Certificate of Incorporation, as amended, exceeds by at least the number of
shares which may be issued in connection with the Plans, the sum of (i) the
number of shares of the Company's Common Stock outstanding, (ii) the number of
shares of the Company's Common Stock held as treasury shares, and (iii) the
number of shares of the Company's Common Stock which the Company is obligated to
issue (or has otherwise reserved for issuance for any purposes), and we have
assumed for purposes of our opinion herein that such condition will remain true
at all future times relevant to this opinion. We have also assumed that the
Company will cause certificates representing Shares issued in the future to be
properly executed and delivered and will take all other actions appropriate for
the due and proper issuance of such Shares. We have assumed for purposes of this
opinion that options issued under the Plans, the Shares issuable upon exercise
of such options and Shares to be issued pursuant to the 2006 Stock Compensation
Plan and the 1,650,000 options issued to the CFO have been duly authorized by
all necessary corporate action on the part of the Company and such options and
Shares of restricted stock have been duly authorized and granted under the
Plans. We express no opinion regarding any shares reacquired by the Company
after initial issuance.
We are members of the Bar of the State of Texas and are not admitted to practice
law in any other jurisdiction. We do not hold ourselves out as being conversant
with, and express no opinion as to, the laws of any jurisdiction other than the
laws of the State of Texas, the General Corporation Law of the State of Nevada,
and laws of the United States of America.
Subject to the limitations stated in this letter, and subject further to
the following limitations, it is our opinion that the Shares issued or issuable
by the Company, under and in accordance with all of the provisions of the Plans,
will, upon delivery thereof and receipt by the Company of all and adequate
consideration owed to the Company therefor (assuming such consideration exceeds
the par value therefor), be validly issued, fully paid and non-assessable.
The foregoing assumes that the aforesaid Registration Statement will
become and remain effective under the Securities Act of 1933, as amended, prior
to any offering of the Shares pursuant to the terms thereof and will be amended,
as appropriate, and that there will be compliance with all applicable state
securities laws in connection with the offering of such securities, as well as
compliance with the terms of the offering set forth in the Registration
Statement.
This opinion is rendered solely for your benefit and may not be relied
upon by any other person or entity. This opinion is provided to you as of the
date hereof. We undertake no, and hereby disclaim any obligation to advise you
of any change in any matter set forth herein. Without our prior written consent,
this opinion may not be quoted in whole or in part or otherwise referred to in
any report or document furnished to any person or entity.
We consent to the filing of this letter as an exhibit to the Registration
Statement. In giving this consent, we do not thereby admit that we are within
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
/s/ Vanderkam & Associates
22
CONSENT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
As independent certified public accountants, we hereby consent to the
incorporation by reference in the Registration Statement on Form S-8 of our
report relating to the consolidated financial statements of Integrated
Management Corporation. which report appears in the Company's Annual Report on
Form SB-2 for the years ended December 31, 2004 and 2005, and to all references
to this firm included in such Registration Statement.
/s/ E. Randall Gruber, CPA, P.C.
E. Randall Gruber,
CPA, P.C.
Date: March 7, 2007