fs1070809_halberd.htm
 


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

==================================
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
==================================
 
HALBERD CORPORATION
(Exact Name of Small Business Issuer in its Charter)

Nevada
7380
26-4346918
(State of Incorporation)
(Primary Standard Classification Code)
(IRS Employer ID No.)
 
Halberd Corporation
10755 Vernon Avenue
Huntington Woods, MI 48070

248-530-0270
 (Address and Telephone Number of Registrant’s Principal
Executive Offices and Principal Place of Business)
 
Mark S. Lundquist, CEO
Halberd Corporation
10755 Vernon Avenue
Huntington Woods, MI 48070

248-530-0270
 (Name, Address and Telephone Number of Agent for Service)
 
Copies of communications to:
GREGG E. JACLIN, ESQ.
ANSLOW & JACLIN, LLP
195 Route 9 South, Suite204
Manalapan, NJ 07726
TELEPHONE NO.: (732) 409-1212
FACSIMILE NO.: (732) 577-1188
 
Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. |_|
 
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, 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 of 1933, 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 of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.|_|
 
If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. |_| 
 
 
 
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
o
Smaller reporting company
x
(Do not check if a smaller reporting company)
     
 
CALCULATION OF REGISTRATION FEE

Title of Each Class Of Securities to be Registered
Amount to be
Registered (1)
Proposed Maximum
Aggregate
Offering Price
per share (2)
Proposed Maximum
Aggregate
Offering Price (3)
Amount of
Registration fee
         
Common Stock, par value $0.001
5,725,000
$0.65
$3,721,250
$207.65
  
(1) In the event of a stock split, stock dividend, or similar transaction involving the common stock, the number of shares registered shall automatically be increased to cover the additional shares of common stock issuable pursuant to Rule 416 under the Securities Act.

(2) The proposed maximum offering price per share and the proposed maximum aggregate offering price have been estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rules 457(c) and 457(h) under the Securities Act of 1933 on the basis of the average of the high and low prices of the Common Stock on the OTC Bulletin Board on July 7, 2009, a date within five (5) trading days prior to the date of the filing of this Registration Statement.

(3) This amount represents the maximum aggregate value of common stock which may be put to the selling shareholder by the registrant pursuant to the terms and conditions of an Investment Agreement between the selling shareholder and the registrant.
 
PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED JULY __, 2009
 
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.
 
The information in this prospectus is not complete and may be changed.  We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective.  This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
 
 
 
 
 
 
 
PROSPECTUS
 
 
5,725,000 SHARES OF
HALBERD CORPORATION
COMMON STOCK
 
 
This prospectus relates to the resale of up to 5,725,000 shares of the common stock of Halberd Corporation, a Nevada corporation, including 3,655,000 shares to be issued to  certain shareholders for services pursuant to certain agreements, 70,000 shares by the members of our Board of Directors and 2,000,000 shares by Dutchess Private Equities Fund Ltd., a Cayman Island exempted company (“Dutchess”), a selling shareholder pursuant to a “put right” under an investment agreement (the “Investment Agreement”), also referred to as an Equity Line of Credit, that we have entered into with Dutchess. The Investment Agreement permits us to “put” up to twenty-five million ($25,000,000) in shares of our common stock to Dutchess. We will not receive any proceeds from the sale of these shares of common stock.  However, we will receive proceeds from the sale of securities pursuant to our exercise of this put right offered by Dutchess. We will bear all costs associated with this registration.
 
Dutchess is an “underwriter” within the meaning of the Securities Act of 1933, as amended (the “Securities Act”) in connection with the resale of our common stock under the Equity Line of Credit. Dutchess will pay us 93% of the lowest closing “best bid” price (the highest posted bid price) of the common stock during the five consecutive trading days immediately following the date of our notice to Dutchess of our election to put shares pursuant to the Investment Agreement.
 
Our shares of common stock are traded on the Over-the-Counter Bulletin Board (the “OTCBB”) under the symbol “HALB.OB.” On July 7, 2009, the closing sale price of our common stock was $0.65 per share.
 
This investment involves a high degree of risk. You should purchase shares only if you can afford a complete loss. See "Risk Factors" beginning on page 4.
 
The information in this prospectus is not complete and may be changed. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. No one may sell these securities nor may offers to buy be accepted until the registration statement filed with the Securities and Exchange Commission is effective. 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, solicitation or sale is not permitted.
 
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of 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:  July __, 2009
 
 
 
 

 
 
 
 

TABLE OF CONTENTS
 
 
PAGE
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  F-
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PROSPECTUS SUMMARY
 
This summary highlights selected information contained elsewhere in this prospectus.  This summary does not contain all the information that you should consider before investing in the common stock.  You should carefully read the entire prospectus, including “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Consolidated Financial Statements, before making an investment decision .
 
About Our Company

We are a development stage company that was incorporated under the laws of the State of Nevada on January 26, 2009. On January 28, 2009, we entered into a share purchase agreement with SellMyBusinessNow.Com, Inc., a corporation established under the laws of the State of Michigan on August 2, 2007 (“SellMyBusiness”), pursuant to which we acquired all the shares of common stock of SellMyBusiness for 25,058,000 shares of our common stock. As a result, SellMyBusiness became our wholly-owned subsidiary.

Our operations are conducted under the name “Sellmybusiness.com®” established on December 3, 2007. Sellmybusiness.com® provides a single web portal for interested parties to find, buy and sell businesses, real estate and equipment and all the related services needed to support the transaction, including financing, incorporation, professional help and additional business resources. Sellmybusiness.com® intends to support businesses of all sizes and types, including start-ups, well-established companies, home-based businesses, closely-held companies, multinational public corporations and franchises. Sellmybusiness.com®’s real estate listing service assists people to buy, sell, lease or sublease commercial and residential land and property. Sellmybusiness.com®’s equipment listing service provides a portal to buy, sell or lease excess inventory, capital equipment, raw materials, vehicles, aircraft, ships and rail equipment.

“The Company,” “we,” “us,” or “our,” are references to the combined business of Halberd Corporation and its wholly-owned subsidiary, SellMyBusinessNow.Com, Inc.

Where You Can Find Us

Our principal executive office location and mailing address is 10755 Vernon Avenue, Huntington Woods, MI 48070.  The corporate telephone number is 248-530-0270.
 
The Offering

This prospectus relates to the resale of up to 5,725,000 shares of our common stock, including 3,655,000 shares to be issued to shareholders pursuant to services agreements, 70,000 shares held by members of our Board of Directors and 2,000,000 to be issued toDutchess pursuant to an Investment Agreement, effective April 30, 2009, entered into by Dutchess and us.

For the purpose of determining the number of shares of common stock to be offered by this prospectus, we have assumed that we will issue not more than 2,000,000 shares pursuant to the exercise of our put right under the Investment Agreement, although the number of shares that we will actually issue pursuant to that put right may be more or less than 2,000,000, depending on the trading price of our common stock.  We currently do not intend to exercise the put right in a manner which would result in our issuance of more than 2,000,000 shares, but if we were to exercise the put right in that manner, we would be required to file a subsequent registration statement with the Securities and Exchange Commission (the “SEC”) and that registration statement would have to be declared effective prior to the issuance of any additional shares.

The Investment Agreement with Dutchess provides that following notice to Dutchess, we may put to Dutchess up to $25,000,000 in shares of our common stock for a purchase price equal to 93% of the lowest closing “best bid” price (the highest posted bid price) of the common stock during the five consecutive trading days immediately following the date of our notice to Dutchess of our election to put shares pursuant to the Investment Agreement. The dollar value that we will be permitted to put pursuant to the Investment Agreement will be either: (A) 200% of the average daily volume in the US market of the common stock for the ten trading days prior to the notice of our put, multiplied by the average of the three daily closing bid prices immediately preceding the date of the put, or (B) $300,000.  Dutchess has indicated that it will resell those shares in the open market, resell our shares to other investors through negotiated transactions, or hold our shares in its portfolio.  This prospectus covers the resale of our stock by Dutchess either in the open market or to other investors through negotiated transactions. Dutchess’ obligations under the Investment Agreement are not transferrable and this registration statement does not cover sales of our common stock by transferees of Dutchess.

 
Dutchess will only purchase shares when we meet the following conditions:

·  
a registration statement has been declared effective and remains effective for the resale of the common stock subject to the Equity Line of Credit;

·  
our common stock has not been suspended from trading for a period of five consecutive trading days and we have not been notified of any pending or threatened proceeding or other action to delist or suspend our common stock;

·  
we have complied with our obligations under the Investment Agreement and the Registration Rights Agreement;

·  
no injunction has been issued and remains in force, and no action has been commenced by a governmental authority which has not been stayed or abandoned, prohibiting the purchase or the issuance of our common stock; and

·  
we have not filed a petition in bankruptcy, either voluntarily or involuntarily, and there shall not have been commenced any proceedings under any bankruptcy or insolvency laws.

The Investment Agreement will terminate when any of the following events occur:

·  
Dutchess has purchased an aggregate of $25,000,000 of our common stock;

·  
we file or otherwise enter an order for relief in bankruptcy; or

·  
our common stock ceases to be registered under the Securities Exchange Act of 1934 (the “Exchange Act”).

As we draw down on the Equity Line of Credit, shares of our common stock will be sold into the market by Dutchess.  The sale of these additional shares could cause our stock price to decline.  In turn, if the stock price declines and we issue more puts, more shares will come into the market, which could cause a further drop in the stock price.  You should be aware that there is an inverse relationship between the market price of our common stock and the number of shares to be issued under the Equity Line of Credit.  If our stock price declines, we will be required to issue a greater number of shares under the Equity Line of Credit.  We have no obligation to utilize the full amount available under the Equity Line of Credit.

Terms of the Offering

Common stock offered:
Up to 5,725,000 shares of common stock, par value $0.001 per share, to be offered for resale by certain shareholders and Dutchess.
   
Common stock to be outstanding
before this offering:
26,128,000 shares
   
Common stock to be outstanding
after this offering:
31,783,000 shares
   
Use of proceeds:
We will not receive any proceeds from the sale of the shares of common stock. However, we will receive proceeds from the Equity Line of Credit.  See “Use of Proceeds”.  
   
Risk factors:
An investment in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 4 of this prospectus.
   
OTC Bulletin Board symbol:
“HALB.OB”
 

 
SUMMARY FINANCIAL DATA
 
Our operations are limited to SellMyBusiness, our wholly-owned subsidiary. The following table provides summary consolidated financial statement data of SellMyBusiness. The interim financial data for the three and nine-month periods ended April 30, 2009 are unaudited. The financial statement data for the period August 2, 2007 (date of inception) to July 31, 2008 has been derived from our audited consolidated financial statements. The data set forth below should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our consolidated financial statements and the related notes included in this prospectus, and the unaudited financial statements and related notes included in this prospectus.
  
   
For the Three Months 
Ended
April 30, 
2009
   
For the Nine Months
Ended
April 30, 
2009
   
For the Period Ended
July 31, 2008 (from inception)
 
   
(Unaudited)
   
(Unaudited)
   
(Audited)
 
                     
Net Sales
 
$
587
   
$
5,679
   
$
7,015
 
                         
Operating expenses
   
365,559
     
501,349
     
44,086
 
                         
Net loss
 
$
(372,057)
   
$
(536,697
 
$
(36,095
)
 
BALANCE SHEET DATA:
 
As of
April 30, 2009
 
As of 
July 31,
2008
(Audited)
(Unaudited)
                 
Current assets
 
$
6,854
   
$
1,387
 
                 
Total assets
 
$
587,539
   
$
341,708
 
                 
Total liabilities (all current)
 
$
525,876
   
$
377,803
 
                 
Stockholders’ equity (deficit)
 
$
61,663
   
$
(36,095
)
                                                                                                 
                   
 
RISK FACTORS

An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below and the other information in this prospectus before investing in our common stock. If any of the following risks occur, our business, operating results and financial condition could be seriously harmed. Please note that throughout this prospectus, the words “we”, “our” or “us” refer to the Company and its subsidiary not to the selling stockholders.

Risk Factors Related to Our Business
 
WE HAVE A LIMITED OPERATING HISTORY THAT YOU CAN USE TO EVALUATE US, AND THE LIKELIHOOD OF OUR SUCCESS MUST BE CONSIDERED IN LIGHT OF THE PROBLEMS, EXPENSES, DIFFICULTIES, COMPLICATIONS AND DELAYS FREQUENTLY ENCOUNTERED BY A SMALL DEVELOPING COMPANY.
 
The Company was incorporated on January 26, 2009, and as such has had minimal operating revenues to date. Further, the Company has no significant assets and minimal earnings from sales. The success of the Company is dependent upon the extent to which it will gain market share. All financial information and financial projections and other assumptions made by the Company are speculative and, while based on management's best estimates of projected sales levels, operational costs, consumer preferences, and the general economic and competitive health of the Company in the business listing marketplace, there can be no assurance that the Company will operate profitably or remain solvent.
 
WE WILL REQUIRE FINANCING TO ACHIEVE OUR CURRENT BUSINESS STRATEGY AND OUR INABILITY TO SECURE REQUIRED FINANCING COULD PROHIBIT US FROM EXECUTING OUR BUSINESS PLAN AND CAUSE US TO SLOW DOWN OUR EXPANSION OF OPERATIONS.
 
Based on the development stage of the Company and its operational plan, management believes that the Company will incur operating losses in the foreseeable future.. Management has entered into a definitive agreement with Dutchess Capital on terms that are acceptable. However, access to the investment fund is predicated on the market for the Company’s stock and therefore the Company cannot issue assurances that our shareholders will not be diluted by investment of such capital, or to the extent of the dilution. Also, we cannot assure that securities issued in exchange for such capital will not be sold on terms more favorable than those of the shares sold in this or other offerings. The availability of such funding is subject to credit, economic, market and legal constraints. The inability to secure required capital from the fund could have a material adverse effect on our business, operation results, or financial condition. Additionally, there are no guarantees that any additional financing can be obtained.

IF WE ARE UNABLE TO ESTABLISH A LARGE USER BASE WE MAY HAVE DIFFICULTY ATTRACTING ADVERTISERS TO OUR WEB SITE AND GENERATING MEMBERSHIP FEES, WHICH WILL HINDER OUR ABILITY TO GENERATE REVENUES, WHICH MAY AFFECT OUR ABILITY TO EXPAND OUR BUSINESS OPERATIONS AND OUR USER BASE.
 
An integral part of our business plan and marketing strategy requires us to establish a large user base. We will only be able to attract additional advertisers to our web site and obtain sufficient membership fees if we can obtain a large enough user base. The number of users necessary to attract advertisers will be determined though discussions with the potential advertisers and their input as to whether we can obtain revenues from advertisements based upon the total members at that time. If for any reason our web site is ineffective at attracting consumers or if we are unable to continue to develop and update our web site to keep consumers satisfied with our service, our user base may decrease and our ability to generate revenues may decline.
 
IN ORDER TO IMPLEMENT OUR BUSINESS PLAN, WE WILL REQUIRE OUR USERS TO PAY FEES FOR OUR SERVICES. IF OUR USERS ARE NOT WILLING TO PAY FOR THESE SERVICES, WE WILL BE FORCED TO SUSPEND AND EVENTUALLY TO CEASE OUR BUSINESS ACTIVITIES.

In order to implement our business plan, we will require our users to pay monthly fees for the use of our services. We cannot guarantee that either our prospective users will be willing to pay for our services. If we are unable to generate sufficient revenues from our user fees, we will be forced to suspend and possible cease all operations.
 
OUR MARKET IS CHARACTERIZED BY RAPID TECHNOLOGICAL CHANGE, AND IF WE FAIL TO DEVELOP AND MARKET NEW TECHNOLOGIES RAPIDLY, WE MAY NOT BECOME PROFITABLE IN THE FUTURE.
 
 
The internet and the online commerce industry are characterized by rapid technological change that could render our existing web site obsolete. The development of our web site entails significant technical and business risks. We can give no assurance that we will successfully use new technologies effectively or adapt our web site to customer requirements or needs. If our management is unable, for technical, legal, financial, or other reasons, to adapt in a timely manner in response to changing market conditions or customer requirements, we may never become profitable.

WE WILL ENCOUNTER INTENSIVE COMPETITION.  WE ARE IN NEED OF FINANCING.

Short-term and/or long-term competition may become intense once the Company launches its business beyond development stage. Although the Company's financial projections assume that the industry will generate competition, there can be no assurances on how any level of competition may impact the financial forecasts and projections made by management. Some competitors may include large publicly funded companies. Some of these potential competitors have greater financial and business resources than the Company. The Company believes that it will be able to effectively compete with these larger entities but there can be no assurances that it will be able to do so.

The lack of adequate funding may adversely affect the Company’s ability to meet its short-term objectives. The Company requires financing to expand its operations, maintain public awareness of its products/services and provide working capital for the anticipated growth of the Company. There can be no assurance that all portions of its financing will be available or, if available that the terms thereof will be attractive to the Company. The lack of additional financing may adversely affect the Company's ability to meet its objectives.
  
OUR MANAGEMENT TEAM HOLDS MAJORITY SHARES OF THE COMPANY AND THERE IS CONFLICT OF INTEREST WHEN MAKING DECISIONS.

Management will have the right, assuming the ownership of the Company does not change, to perpetuate their status as officers and directors and therefore conduct the business and affairs of the Company.  The terms of any employment agreements or other agreements between the Company and its officers were not the result of any arm's length bargaining or negotiation, and such transactions involve inherent conflicts of interest. There is no assurance that such transactions are or will be favorable to the Company due to the lack of arm's length bargaining.  The Board of Directors, does however, believe that such agreements and arrangements are fair to the Company and its shareholders.  The Company has a policy that it will not enter into a business combination with any entity in which any member of management serves as an officer, director or partner, or in which such person or such person's affiliates or associates hold any ownership interest.  If there is any related party transaction, however remote, it would be submitted for approval by an independent quorum of the Board of Directors and the proposed transaction would be submitted to the shareholders for prior ratification in an appropriate manner.

THERE IS MINIMAL HISTORICAL BASIS FOR MANAGEMENT'S OPINION.

The Company has a limited operating history. Accordingly, there is only a minimal basis, other than the judgment of management, upon which to estimate the volume of sales or the amount of revenues, which the Company's planned operations may generate. Management's judgment regarding these estimates is based, in part, upon research into the current state of the listing service marketplace. Investors for the shares should be aware that conditions and circumstances beyond the control of management may result in substantial differences between the projected and actual financial results for the Company.

THE COMPANY IS DEPENDENT ON KEY PERSONNEL.

The Company is dependent upon its experienced management team, including its CEO, Mark Lundquist, and President, Interim CFO & COO, John Maddox. The loss of any of their services could negatively impact the Company, as there is a risk that their services could not be replaced. Without these services, the growth, progress, and overall success of the Company may be adversely affected.

THERE IS LIMITED LIABILITY OF MANAGEMENT AND IT MAY REQUIRE THE COMPANY TO INDEMNIFY ITS OFFICERS AND DIRECTORS.

The Company has adopted provisions to its Articles of Incorporation and bylaws, which limit the liability of its officers and directors and provide for indemnification by the Company of its officers and directors to the fullest extent permitted by Nevada corporate law.  Such law generally provides that its officers and directors shall have no personal liability to the Company or its shareholders for monetary damages for breaches of their fiduciary duties as directors, except for breaches of their duties of loyalty, acts or omissions not in good faith or which involve intentional misconduct or knowing violation of the law, acts involving unlawful payment of dividends or unlawful stock purchases or redemptions, or any transaction from which a director derives an improper personal benefit. Such provisions substantially limit the shareholders' ability to hold officers and directors liable for breaches of fiduciary duty, and may require the Company to indemnify its officers and directors.

 
OUR ABILITY TO CONTINUE DEPENDS UPON ADDITIONAL FUNDING.
 
We are a development stage company that has generated minimal revenues. For the period from inception to July 31, 2008, we have incurred a net loss of $36,095, and for the period from inception to April 30, 2009, we have incurred a net loss of $572,792. If we cannot generate sufficient revenues from our services or obtain sufficient funding, we may not be able to implement our business plan and may be forced to cease our business activities.

THE COMPANY HAS NOT PAID OR DECLARED ANY DIVIDENDS, NOR, DOES IT ANTICIPATE PAYING ANY DIVIDENDS IN THE FORESEEABLE FUTURE.

The Company has not paid or declared any dividends, nor, by reason of its present financial status and its contemplated financial requirements, does it anticipate paying any dividends in the foreseeable future. The future payment of dividends by the Company on its Common Stock, if any, rests within the sole discretion of the Company's board of directors and will depend, on among other things, the Company's earnings, its capital requirements and its financial condition as well as other relevant factors.

OUR ARTICLES OF INCORPORATION PROVIDE FOR INDEMNIFICATION OF OFFICERS AND DIRECTORS AT OUR EXPENSE AND LIMIT THEIR LIABILITY WHICH MAY RESULT IN A MAJOR COST TO US AND HURT THE INTERESTS OF OUR SHAREHOLDERS BECAUSE CORPORATE RESOURCES MAY BE EXPENDED FOR THE BENEFIT OF OFFICERS AND/OR DIRECTORS.  

Our articles of incorporation and applicable Nevada law provide for the indemnification of our directors, officers, employees, and agents, under certain circumstances, against attorney's fees and other expenses incurred by them in any litigation to which they become a party arising from their association with or activities on our behalf. We will also bear the expenses of such litigation for any of our directors, officers, employees, or agents, upon such person's written promise to repay us if it is ultimately determined that any such person shall not have been entitled to indemnification. This indemnification policy could result in substantial expenditures by us which we will be unable to recoup.

We have been advised that, in the opinion of the SEC, indemnification for liabilities arising under federal securities laws is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification for liabilities arising under federal securities laws, other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding, is asserted by a director, officer or controlling person in connection with the securities being registered, we 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 indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. The legal process relating to this matter if it were to occur is likely to be very costly and may result in us receiving negative publicity, either of which factors is likely to materially reduce the market and price for our shares, if such a market ever develops.  

Risk Factors Related to Our Securities, the Equity Line of Credit and This Offering

WE ARE REGISTERING AN AGGREGATE OF 5,725,000 SHARES OF COMMON STOCK, INCLUDING 2,000,000 SHARES OF COMMON STOCK TO BE ISSUED UNDER THE EQUITY LINE OF CREDIT.  THE SALE OF SUCH SHARES COULD DEPRESS THE MARKET PRICE OF OUR COMMON STOCK.

We are registering an aggregate of 5,725,000 shares of common stock, including 2,000,000 shares of common stock under the registration statement of which this prospectus forms a part for issuance pursuant to the Equity Line of Credit. The sale of these shares into the public market by Dutchess could depress the market price of our common stock.  As of July 7, 2009, there were 26,128,000 shares of our common stock issued and outstanding.

ASSUMING WE UTILIZE THE MAXIMUM AMOUNT AVAILABLE UNDER THE EQUITY LINE OF CREDIT, EXISTING SHAREHOLDERS COULD EXPERIENCE SUBSTANTIAL DILUTION UPON THE ISSUANCE OF COMMON STOCK.

Our Equity Line of Credit with Dutchess contemplates the potential future issuance and sale of up to $25,000,000 of our common stock to Dutchess subject to certain restrictions and obligations. The following table is an example of the number of shares that could be issued at various prices assuming we utilize the maximum amount available under the Equity Line of Credit. These examples assume issuances at 95% of a market price of $0.65 per share and at 10%, 25% and 50% below $0.65 per share.

The following table should be read in conjunction with the footnotes immediately following the table.
 
 

 
Percent below current market price
 
Price per share (1)
Number of shares issuable (2)
Shares
outstanding (3)
Percent of outstanding
shares (4)
5%
$0.6175
40,485,830
70,268,830
55.57%
10%
$0.5850
42,735,043
72,518,043
56.90%
25%
$0.4875
51,282,051
81,065,051
61.30%
50%
$0.3250
76,923,077
106,706,077
70.38%

                        (1)  Represents purchase prices equal to 95% of $0.65 per share and potential reductions thereof of 10%, 25% and 50%.
                        (2) Represents the number of shares issuable if the entire commitment of $25,000,000 under the Equity Line of Credit were drawn down at the indicated purchase prices.
                        (3) Based on 29,783,000 shares, including 26,128,000 shares of common stock outstanding at July 7, 2009 and 3,655,000 shares issuable to certain shareholders pursuant to  consulting agreements. 
                       (4) Percentage of the total outstanding shares of common stock after the issuance of the shares indicated, without considering any contractual restriction on the number of shares the selling shareholder may own at any point in time or other restrictions on the number of shares we may issue.

WE MAY NOT HAVE ACCESS TO THE FULL AMOUNT UNDER THE EQUITY LINE.

As of July 7, 2009, the closing market price of our common stock is $0.65. There is no assurance that the market price of our common stock will increase substantially in the near future. The entire commitment under the Equity Line of Credit is $25,000,000. Presumably we will maintain the market price of our common stock at $0.65, we need to issue 40,485,830 shares of common stock to Dutchess (at a 5% discount) in order to have access to the full amount under the Equity Line of Credit.

DUTCHESS WILL PAY LESS THAN THE THEN-PREVAILING MARKET PRICE FOR OUR COMMON STOCK.

The common stock to be issued to Dutchess pursuant to the Investment Agreement will be purchased at a seven percent discount to the lowest closing “best bid” price (the highest posted bid price) of the common stock during the five consecutive trading days immediately following the date of our notice to Dutchess of our election to put shares pursuant to the Investment Agreement. Dutchess has a financial incentive to sell our common stock immediately upon receiving the shares to realize the profit equal to the difference between the discounted price and the market price. If Dutchess sells the shares, the price of our common stock could decrease. If our stock price decreases, Dutchess may have a further incentive to sell the shares of our common stock that it holds. These sales may have a further impact on our stock price.

THERE MAY NOT BE SUFFICIENT TRADING VOLUME IN OUR COMMON STOCK TO PERMIT US TO GENERATE ADEQUATE FUNDS FROM THE EXERCISE OF OUR PUT.

The Investment Agreement provides that the dollar value that we will be permitted to put to Dutchess will be either: (A) 200% of the average daily volume in the US market of the common stock for the three trading days prior to the notice of our put, multiplied by the average of the three daily closing bid prices immediately preceding the date of the put, or (B) $300,000.  If the average daily trading volume in our common stock is too low, it is possible that we would only be permitted to exercise a put for $300,000, which may not provide adequate funding for our planned operations.

OUR COMMON STOCK IS THINLY TRADED, SO YOU MAY BE UNABLE TO SELL AT OR NEAR ASK PRICES OR AT ALL IF YOU NEED TO SELL YOUR SHARES TO RAISE MONEY OR OTHERWISE DESIRE TO LIQUIDATE YOUR SHARES.

Our common stock has historically been sporadically or “thinly-traded” on the OTCBB, meaning that the number of persons interested in purchasing our common stock at or near ask prices at any given time may be relatively small or nonexistent. This situation is attributable to a number of factors, including the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares until such time as we became more seasoned and viable.

As a consequence, there may be periods of several days or more when trading activity in our shares is minimal or non-existent, as compared to a mature issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price.  It is possible that a broader or more active public trading market for our common stock will not develop or be sustained, or that current trading levels will continue.

 
THE SELLING SHAREHOLDER MAY ENGAGE IN SHORT SALES. SIGNIFICANT SHORT SALES OF OUR COMMON STOCK WILL CAUSE THE DECLINE OF OUR SHARE PRICE

In connection with the distribution of the common stock or otherwise, the selling shareholder may enter into hedging transactions with broker-dealers or other financial institutions. In connection with such transactions, broker-dealers or other financial institutions may engage in short sales of shares in the course of hedging the positions they assume with the selling shareholder. If there are significant short sales of our stock, the price decline that would result from this activity will cause our share price to decline which in turn may cause long holders of our stock to sell their shares thereby contributing to sales of stock in the market. If there is an imbalance on the sell side of the market our stock the price will decline. It is not possible to predict if the circumstances where by a short sales could materialize or to what our share price could drop. In some companies that have been subjected to short sales their stock price has dropped to near zero. We cannot provide any assurances that this situation will not happen to us.

THE MARKET PRICE FOR OUR COMMON STOCK IS PARTICULARLY VOLATILE GIVEN OUR STATUS AS A RELATIVELY UNKNOWN COMPANY WITH A SMALL AND THINLY TRADED PUBLIC FLOAT, LIMITED OPERATING HISTORY AND LACK OF NET REVENUES WHICH COULD LEAD TO WIDE FLUCTUATIONS IN OUR SHARE PRICE.  THE PRICE AT WHICH YOU PURCHASE OUR COMMON STOCK MAY NOT BE INDICATIVE OF THE PRICE THAT WILL PREVAIL IN THE TRADING MARKET.

The market for our common stock is characterized by significant price volatility when compared to seasoned issuers, and we expect that our share price will continue to be more volatile than a seasoned issuer for the indefinite future.  In fact, during the period from June 10, 2009 (first date of trading) until July 7, 2009, the high and low sale prices of a share of our common stock were $0.75 and $0.10, respectively. The volatility in our share price is attributable to a number of factors.  First, as noted above, the shares of our common stock are sporadically and/or thinly traded.  As a consequence of this lack of liquidity, the trading of relatively small quantities of shares by our shareholders may disproportionately influence the price of those shares in either direction.  The price for our shares could, for example, decline precipitously in the event that a large number of shares of our common stock are sold on the market without commensurate demand, as compared to a seasoned issuer which could better absorb those sales without adverse impact on its share price.

Secondly, we are a speculative or “risky” investment due to our limited operating history and lack of profits to date, and uncertainty of future market acceptance for our products and services.  As a consequence of this enhanced risk, more risk-adverse investors may, under the fear of losing all or most of their investment in the event of negative news or lack of progress, be more inclined to sell their shares on the market more quickly and at greater discounts than would be the case with the stock of a seasoned issuer.

YOU MAY BE UNABLE TO SELL YOUR COMMON STOCK AT OR ABOVE YOUR PURCHASE PRICE, WHICH MAY RESULT IN SUBSTANTIAL LOSSES TO YOU.

The following factors may add to the volatility in the price of our common stock: actual or anticipated variations in our quarterly or annual operating results; government regulations, announcements of significant acquisitions, strategic partnerships or joint ventures; our capital commitments; and additions or departures of our key personnel.  Many of these factors are beyond our control and may decrease the market price of our common stock, regardless of our operating performance.  We cannot make any predictions or projections as to what the prevailing market price for our common stock will be at any time, including as to whether our common stock will sustain its current market price, or as to what effect that the sale of shares or the availability of common stock for sale at any time will have on the prevailing market price.

VOLATILITY IN OUR COMMON STOCK PRICE MAY SUBJECT US TO SECURITIES LITIGATION.

The market for our common stock is characterized by significant price volatility when compared to seasoned issuers, and we expect that our share price will continue to be more volatile than that of a seasoned issuer for the indefinite future.  In the past, plaintiffs have often initiated securities class action litigation against a company following periods of volatility in the market price of its securities.  We may in the future be the target of similar litigation.  Securities litigation could result in substantial costs and liabilities and could divert management’s attention and resources.

SHARES ELIGIBLE FOR FUTURE SALE BY OUR CURRENT SHAREHOLDERS MAY ADVERSELY AFFECT OUR STOCK PRICE.

To date, we have had a very limited trading volume in our common stock.  As long as this condition continues, the sale of a significant number of shares of common stock at any particular time could be difficult to achieve at the market prices prevailing immediately before such shares are offered.  In addition, sales of substantial amounts of common stock, including shares issued upon the exercise of outstanding options and warrants, under Securities and Exchange Commission Rule 144 or otherwise could adversely affect the prevailing market price of our common stock and could impair our ability to raise capital at that time through the sale of our securities.  

 
OUR ISSUANCE OF ADDITIONAL COMMON STOCK IN EXCHANGE FOR SERVICES OR TO REPAY DEBT WOULD DILUTE YOUR PROPORTIONATE OWNERSHIP AND VOTING RIGHTS AND COULD HAVE A NEGATIVE IMPACT ON THE MARKET PRICE OF OUR COMMON STOCK.

Our Board of Directors may issue shares of common stock to pay for debt or services, without further approval by our stockholders based upon such factors as our Board may deem relevant at that time.  We have issued shares of our common stock in payment for services in the past. It is likely that we will issue additional securities to pay for services and reduce debt in the future.  It is possible that we will issue additional shares of common stock under circumstances we may deem appropriate at the time.

THE ELIMINATION OF MONETARY LIABILITY AGAINST OUR DIRECTORS, OFFICERS AND EMPLOYEES UNDER OUR ARTICLES OF INCORPORATION AND THE EXISTENCE OF INDEMNIFICATION RIGHTS FOR OUR DIRECTORS, OFFICERS AND EMPLOYEES MAY RESULT IN SUBSTANTIAL EXPENDITURES BY HALBERD AND MAY DISCOURAGE LAWSUITS AGAINST OUR DIRECTORS, OFFICERS AND EMPLOYEES.

Our Articles of Incorporation contain provisions which eliminate the liability of our directors for monetary damages to Halberd and our shareholders.  Our Bylaws also require us to indemnify our officers and directors. We may also have contractual indemnification obligations under our agreements with our directors, officers and employees. The foregoing indemnification obligations could cause us to incur substantial expenditures to cover the cost of settlement or damage awards against directors, officers and employees, which we may be unable to recoup.  These provisions and resultant costs may also discourage us from bringing a lawsuit against directors, officers and employees for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders against our directors, officers and employees even though such actions, if successful, might otherwise benefit us and our shareholders.

IF WE FAIL TO REMAIN CURRENT ON OUR REPORTING REQUIREMENTS, WE COULD BE REMOVED FROM THE OTC BULLETIN BOARD, WHICH WOULD LIMIT THE ABILITY OF BROKER-DEALERS TO SELL OUR SECURITIES AND THE ABILITY OF SHAREHOLDERS TO SELL THEIR SECURITIES IN THE SECONDARY MARKET.

Companies trading on the OTC Bulletin Board, such as Halberd, must be reporting issuers under Section 12 of the Exchange Act, and must be current in their reports under Section 13 of the Exchange Act, in order to maintain price quotation privileges on the OTC Bulletin Board.  If we fail to remain current on our reporting requirements, we could be removed from the OTC Bulletin Board.  As a result, the market liquidity for our securities could be adversely affected by limiting the ability of broker-dealers to sell our securities and the ability of shareholders to sell their securities in the secondary market.
  
OUR COMMON STOCK IS CONSIDERED A PENNY STOCK, WHICH IS SUBJECT TO RESTRICTIONS ON MARKETABILITY, SO YOU MAY NOT BE ABLE TO SELL YOUR SHARES.
 
If our common stock becomes tradable in the secondary market, we will be subject to the penny stock rules adopted by the Securities and Exchange Commission that require brokers to provide extensive disclosure to their customers prior to executing trades in penny stocks. These disclosure requirements may cause a reduction in the trading activity of our common stock, which in all likelihood would make it difficult for our shareholders to sell their securities.

Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The broker-dealer must also make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction. These requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that becomes subject to the penny stock rules. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in our securities, which could severely limit their market price and liquidity of our securities. These requirements may restrict the ability of broker-dealers to sell our common stock and may affect your ability to resell our common stock.
 
 
USE OF PROCEEDS

We will not receive any proceeds from the sale of common stock offered by certain shareholders and Dutchess. However, we will receive proceeds from the sale of our common stock to Dutchess pursuant to the Investment Agreement. The proceeds from our exercise of the put option pursuant to the Investment Agreement will be used for working capital and general corporate expenses.
We propose to expend these proceeds as follows:

   
Proceeds if 100%, or 2,000,000 shares sold
   
Proceeds if 50% or 1,000,000 shares sold
 
 
Gross proceeds (1)
  $ 1,209,000     $ 604,500  
Offering expenses:
               
Marketing
  $ 650,000     $ 190,000  
Payroll
  $ 250,000     $ 180,000  
Facilities
  $ 50,000     $ 50,000  
Furniture & Equipment
  $ 15,000     $ 15,000  
Insurances
  $ 30,000     $ 30,000  
Contract Labor
  $ 60,500     $ 60,500  
Legal fees
  $ 73,000     $ 3,500  
  Printing of prospectus
  $ 500     $ 500  
  Accounting and auditing fees
  $ 70,000     $ 70,000  
  State securities fees
               
  Transfer agent fees
               
  Miscellaneous expenses
  $ 10,000     $ 5,000  
Total offering expenses
               
Net proceeds
  $ 1,209,000     $ 604,500  

(1) Reflecting a 7% discount to Dutchess, and assuming the offering price is $0.65 per share.

Working capital needs include accounts payable and inventory.
   
SELLING SHAREHOLDERS

The following table sets forth the name of the selling shareholder, the number of shares of common stock owned, the number of shares of common stock registered by this prospectus and the number and percent of outstanding shares that the selling shareholder will own after the sale of the registered shares, assuming all of the shares are sold.  The information provided in the table and discussions below has been obtained from the selling shareholder.  The selling shareholder may have sold, transferred or otherwise disposed of, or may sell, transfer or otherwise dispose of, at any time or from time to time since the date on which it provided the information regarding the shares, all or a portion of the shares of common stock beneficially owned in transactions exempt from the registration requirements of the Securities Act.  As used in this prospectus, “selling shareholder” includes donees, pledges, transferees or other successors in interest selling shares of our common stock received from the named selling shareholder as a gift, pledge, distribution or other non sale-related transfer.

Beneficial ownership is determined in accordance with Rule 13d-3(d) promulgated by the Securities and Exchange Commission under the Exchange Act.  Unless otherwise noted, each person or group identified possesses sole voting and investment power with respect to the shares, subject to community property laws where applicable. As of July 7, 2009, there were 26,128,000 shares of our common stock issued and outstanding.

On April 30, 2009, we previously entered into an Investment Agreement with Dutchess to raise up to $25,000,000 through an equity line of credit.   Except as described above, to our knowledge Dutchess has not had a material relationship with us during the last three years, other than as an owner of our common stock or other securities.

On July 2, 2009, we entered into a Chief of Staff Services Extension Agreement with River Star, LLC, by which River Star would provide various consulting services in exchange for $7,500 per month through the end of our 2010 fiscal year and 1,000,000 shares of our common stock. The 1,000,000 shares will be issued in sixteen (16) equal monthly installments beginning August 2009 and are being registered in this registration statement.
 
 
On July 2, 2009, we entered into a Services Agreement with Awecomm Technologies, LLC (“Awecomm”), by which Awecomm would provide webhosting and development services in exchange for 804,000 shares of our common stock. The 804,000 shares will be issued to Awecomm up to 43,855 per month beginning August 2009 and are being registered in this registration statement

On July 2, 2009, we entered into a Services Agreement with Issuers Capital Advisors, LLC, by which Issuers Capital Advisor LLC would provide Investor and Public Relations services in exchange for 456,000 shares of our common stock. The 456,000 shares will be issued to Issuers Capital Advisor LLC up to 38,000 per month beginning August 2009 and are being registered in this registration statement

On July 2, 2009, we entered into a Services Agreement with Marx Layne, Inc., by which Marx Layne, Inc. would provide marketing and content development services in exchange for 395,000 shares of our common stock. The 395,000 shares will be issued to Marx Layne, Inc. up to 32,917 per month beginning August 2009 and are being registered in this registration statement.

In addition, we are registering 10,000 shares each which are held by the members of our Board of Directors.

Beneficial Ownership of Common Shares
Prior to this Offering
Number of Shares
to be Sold
Under this Prospectus (1)
Beneficial Ownership of Common Shares
after this Offering
Selling Shareholder
Number of Shares
Percent of Class
Number of Shares (2)
Percent of Class (3)
Dutchess Private Equities Fund, Ltd. (4)
 
0
 
--
 
2,000,000
 
0
 
--
Anslow & Jaclin, LLP (5)
0
--
1,000,000
0
--
River Star, LLC (6) (11)
1,010,000
3.87% (7)
1,010,000
1,000,000
3.33%
Awecomm Technologies, LLC (8)
0
--
804,000
0
--
Issuers Capital Advisors, LLC (9)
0
--
456,000
0
--
Marx Layne, Inc. (10)
0
--
395,000
0
--
John C. Maddox
13,010,000
49.79%
10,000
13,000,000
40.90%
Mark Lundquist
4,010,000
15.35%
10,000
4,000,000
12.59%
Leland Thomas
2,806,000
10.74%
10,000
2,796,000
8.80%
Bruce Nyberg
30,000
*
10,000
20,000
*
Lizabeth Ardisana
10,000
*
10,000
0
--
Michael Burns
10,000
*
10,000
0
--
Total
20,886,000
79.94%
5,725,000
20,816,000
65.49%

* less than 1%

(1)  
The number of shares set forth in the table represents an estimate of the number of common shares to be offered by the selling shareholder.  We have assumed the sale of all of the common shares offered under this prospectus will be sold. However, as the selling shareholder can offer all, some or none of its common stock, no definitive estimate can be given as to the number of shares that the selling shareholder will offer or sell under this prospectus.

(2)  
These numbers assume the selling shareholder sells all of its shares after the completion of the offering.

(3)  
Based on 31,783,000 shares of common stock outstanding after the completion of the offering.

(4)  
Dutchess is a Cayman Island exempted corporation.  Michael Novielli and Douglas H. Leighton are directors of Dutchess with voting and investment power over the shares.

(5)  
Anslow & Jaclin, LLP is our legal counsel. We will issue 62,500 shares of our common stock for its legal services per month for sixteen (16) months beginning August 2009.  Richard I. Anslow is the managing partner of Anslow & Jaclin, LLP and has voting and dispositive control over securities held by Anslow & Jaclin, LLP.

(6)  
The 1,010,000 shares registered herewith includes 1,000,000 shares issuable under the Chief of Staff Extension Services Agreement and 10,000 shares issued for the services rendered by Nicholas A. Coco as a member of our Board of Directors. Nicholas A. Cocco has voting and dispositive control over securities held by River Star, LLC.  He is a member of our Board of Directors.
 
 
(7)  
Based on 26,128,000 shares of common stock outstanding before the completion of this offering.

(8)  
Janet Nawrocki has voting and dispositive control over securities held by Awecomm Technologies, LLC.

(9)  
Gregg Linn has voting and dispositive control over securities held by Issuers Capital Advisors, LLC.
  
(10)  
Michael Szudarek has voting and dispositive control over securities held by Marx Layne, Inc.
 
PLAN OF DISTRIBUTION

The purpose of this prospectus is to permit the selling shareholder to offer and sell up to an aggregate of 5,725,000 shares at such times and at such places as they choose.  The decision to sell any shares is within the sole discretion of the holder thereof.

The distribution of the common stock by a selling shareholder may be effected from time to time in one or more transactions.  Any of the common stock may be offered for sale, from time to time, by a selling shareholder, or by permitted transferees or successors of the selling shareholder, or otherwise, at prices and on terms then obtainable, at fixed prices, at prices then prevailing at the time of sale, at prices related to such prevailing prices, or in negotiated transactions at negotiated prices or otherwise.  The common stock may be sold by one or more of the following:
 
·  
On the OTCBB or any other national common stock exchange or automated quotation system on which our common stock is traded, which may involve transactions solely between a broker-dealer and its customers which are not traded across an open market and block trades.
·  
Through one or more dealers or agents (which may include one or more underwriters), including, but not limited to:
·  
Block trades in which the broker or dealer as principal and resale by such broker or dealer for its account pursuant to this prospectus.
·  
Purchases by a broker or dealer as principal and resale by such broker or dealer for its account pursuant to this prospectus.
·  
Ordinary brokerage transactions.
·  
Transactions in which the broker solicits purchasers
·  
Directly to one or more purchasers.
·  
A combination of these methods.

Dutchess and any broker-dealers who act in connection with the sale of its shares are “underwriters” within the meaning of the Securities Act, and any discounts, concessions or commissions received by them and profit on any resale of the shares as principal may be deemed to be underwriting discounts, concessions and commissions under the Securities Act.

In connection with the distribution of the common stock or otherwise, the selling shareholder may enter into hedging transactions with broker-dealers or other financial institutions. In connection with such transactions, broker-dealers or other financial institutions may engage in short sales of shares in the course of hedging the positions they assume with the selling shareholder. A selling shareholder may also sell shares short and redeliver the shares to close out such short positions. A selling shareholder may also enter into options or other transactions with broker-dealers or other financial institutions which require the delivery to such broker-dealers or other financial institutions of the common stock, which shares such broker-dealers or financial institutions may resell pursuant to this prospectus, as supplemented or amended to reflect that transaction. A selling shareholder may also pledge the common stock registered hereunder to a broker-dealer or other financial institution and, upon a default, such broker-dealer or other financial institution may affect sales of the pledged shares pursuant to this prospectus, as supplemented or amended to reflect such transaction. In addition, any common stock covered by this prospectus that qualifies for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than pursuant to this prospectus.

The selling shareholder or its underwriters, dealers or agents may sell the common stock to or through underwriters, dealers or agents, and such underwriters, dealers or agents may receive compensation in the form of discounts or concessions allowed or reallowed. Underwriters, dealers, brokers or other agents engaged by the selling shareholder may arrange for other such persons to participate. Any fixed public offering price and any discounts and concessions may be changed from time to time. Underwriters, dealers and agents who participate in the distribution of the common stock may be deemed to be underwriters within the meaning of the Securities Act, and any discounts or commissions received by them or any profit on the resale of shares by them may be deemed to be underwriting discounts and commissions thereunder. The proposed amounts of the common stock, if any, to be purchased by underwriters and the compensation, if any, of underwriters, dealers or agents will be set forth in a prospectus supplement.

 
Unless granted an exemption by the Commission from Regulation M under the Exchange Act, or unless otherwise permitted under Regulation M, a selling shareholder  will not engage in any stabilization activity in connection with our common stock, will furnish each broker or dealer engaged by a selling shareholder and each other participating broker or dealer the number of copies of this prospectus required by such broker or dealer, and will not bid for or purchase any common stock of our or attempt to induce any person to purchase any of the common stock other than as permitted under the Exchange Act.

We will not receive any proceeds from the sale of these shares of common stock offered by the selling shareholder. We shall use our best efforts to prepare and file with the Commission such amendments and supplements to the registration statement and this prospectus as may be necessary to keep such registration statement effective and to comply with the provisions of the Securities Act with respect to the disposition of the common stock covered by the registration statement for the period required to effect the distribution of such common stock.

We are paying certain expenses (other than commissions and discounts of underwriters, dealers or agents) incidental to the offering and sale of the common stock to the public, which are estimated to be approximately $20,000. If we are required to update this prospectus during such period, we may incur additional expenses in excess of the amount estimated above.

In order to comply with certain state securities laws, if applicable, the common stock will be sold in such jurisdictions only through registered or licensed brokers or dealers. In certain states the shares of common stock may not be sold unless they have been registered or qualify for sale in such state or an exemption from registration or qualification is available and is complied with.

DESCRIPTION OF SECURITIES

General
 
Our authorized capital stock consists of 120,000,000 shares of common stock, par value $0.001 per share, and 10,000,000 shares of preferred stock, par value $0.001 per share. We have not yet issued any preferred stock. There are no provisions in our charter or by-laws that would delay, defer or prevent a change in our control.
 
Common Stock
 
We are authorized to issue 120,000,000 shares of common stock.  Currently we have 26,128,000 common shares issued and outstanding.
 
The holders of our common stock have equal ratable rights to dividends from funds legally available if and when declared by our Board of Directors and 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. Our common stock does not provide the right to a preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights. Our common stock holders are entitled to one non-cumulative vote per share on all matters on which shareholders may vote.
 
All shares of common stock now outstanding are fully paid for and non-assessable and all shares of common stock which are being registered pursuant to this registration statement are fully paid and non-assessable.  We refer you to our Articles of Incorporation, Bylaws and the applicable statutes of the state of Nevada for a more complete description of the rights and liabilities of holders of our securities.  All material terms of our common stock have been addressed in this section.
  
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.

Dividends
 
We have not paid any cash dividends to shareholders.  The declaration of any future cash dividends is at the discretion of our board of directors and depends  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.

Convertible Notes

On November 28, 2007 and January 3, 2008, we entered into convertible promissory notes with certain investors totaling $300,000. In addition, we issued 1,501 shares to these investors. In January 2009, we entered into stock conversion agreements with these investors, pursuant to which we issued 2,300 shares of our common stock as conversion of promissory notes dated November 28, 2007 and January 3, 2008 including principal of $300,000 and interest of 23,000 at a conversion price of $133.00 and $500.00 per share, respectively.
 
 
INTERESTS OF NAMED EXPERTS AND COUNSEL

No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
 
The consolidated financial statements for the period ended July 31, 2008 included in this prospectus and the registration statement have been audited by Rehmann Robson, P.C. to the extent and for the periods set forth in their report appearing elsewhere herein and in the registration statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

Rehmann Robson, P.C., the Company’s independent registered public accounting firm, has performed reviews of the unaudited interim consolidated financial statements included herein.  Pursuant to Rule 436(c) of the Securities Act of 1933 (“Act”) their report on these reviews should not be considered a part of this registration statement nor a “report” within the meaning of sections 7 and 11 of the Act and the independent registered public accounting firm liability under Section 11 does not extend to it.
 
CORPORATE HISTORY AND STRUCTURE

Our History

We are a development stage company that was incorporated under the laws of the State of Nevada on January 26, 2009. On January 28, 2009, we entered into a share purchase agreement with SellMyBusiness, a corporation established under the laws of the State of Michigan in August 2007, pursuant to which we acquired all of the issued and outstanding shares of common stock of SellMyBusiness for 25,058,000 shares of our common stock. As a result, SellMyBusiness became our wholly-owned subsidiary.

Our operations are conducted through our wholly owned subsidiary SellMyBusiness under the name “Sellmybusiness.com®” established on December 3, 2007. To date, the Company’s activities have been limited to raising capital, obtaining financing, constructing its website and administrative functions. Sellmybusiness.com® provides a single web portal for interested parties to find, buy and sell businesses, real estate and equipment and all the related services needed to support the transaction, including financing, incorporation, professional help and additional business resources. Sellmybusiness.com® intends to support businesses of all sizes and types, including start-ups, well-established companies, home-based businesses, closely-held companies, multinational public corporations and franchises. Sellmybusiness.com®’s real estate listing service assists people to buy, sell, lease or sublease commercial or residential land and property. Sellmybusiness.com®’s equipment listing service provides a portal to buy, sell or lease excess inventory, capital equipment, raw materials, vehicles, aircraft, ships and rail equipment.
  
Upon inception of SellMyBusiness on August 2, 2007, we issued 6,500 shares to John Maddox as founder shares for no consideration.   On November 28, 2007, we issued 2,000 shares to Mark Lundquist as founder shares for no consideration.  On November 28, 2007 and January 3, 2008, we entered into convertible promissory notes with certain investors totaling of $300,000. In addition, we issued 1,501 shares to these investors. In January 2009, we entered into stock conversion agreements with these investors, pursuant to which we issued 2,300 shares of our common stock as conversion of promissory notes dated November 28, 2007 and January 3, 2008 including principal of $300,000 and interest of 23,000 at a conversion price of $133.00 and $500.00 per share, respectively. In January 2009, we completed an offering in which we sold 228 shares of common stock at $500 per share in connection with our private placement. Please note that the share numbers in this paragraph are given before the effectiveness of share exchange agreement dated January 28, 2009.
  
DESCRIPTION OF BUSINESS

Overview

SellMyBusiness.com® (a wholly owned subsidiary of Halberd Corporation) provides a single web portal for business people to find, buy and sell businesses, real estate and equipment and all the related services needed to support the transaction, including financing, incorporation, professional help and additional business resources.  SellMyBusiness.com intends to support businesses of all sizes and types, including start-ups, well-established companies, home-based businesses, closely-held companies, multi-national public corporations and franchises.  SellMyBusiness.com’s real estate listing service assists people to buy, sell, lease or sub-lease commercial and residential land and property.  SellMyBusiness.com’s equipment listing service provides business people with a portal to buy, sell or lease excess inventory, capital equipment, raw materials, vehicles, aircraft, ships and rail equipment.  In its first month of operation, the site attracted over half a million visitors.

 
Business Model

The strategy for SellMyBusiness.com is to become the recognized online total solution provider for buying or selling a business and everything related to the transaction.  This strategy encompasses the following key elements:

·
Listing businesses for sale with a local, regional, national and international reach.
·
Listing real estate for sale or lease, particularly when linked to a business for sale.

·
Listing equipment for sale or lease, particularly when the equipment, assets and inventory are linked to the business for sale.
·
Special confidential listing service for businesses, real estate and equipment.

·
Special pre-qualified buyer service for businesses, real estate and equipment.
·
Professional service provider referrals to assist in the purchase, sale, start-up or operation of a business, such as attorneys, brokers, accountants, business valuators and consultants.

·
Online document management system for handling all paperwork involved in the sale or lease of businesses, real estate and equipment.
·
Business resources for owners and executives, such as business books, white papers, and important links.

·
Live support.
·
Easy-to-navigate, easy-to-understand website.

·
Multilingual website versions.
·
Support for all types of businesses: public corporations, private companies, franchises, not-for-profits and home-based businesses.

Revenue is generated from five methods:

1)  
fees for listing businesses, real estate and equipment for sale or lease;
2)  
membership registration fees for lead generation for professional service providers in multiple categories;
3)  
registration fees for broker/dealers to have monthly or annual access rights for selling or leasing businesses, real estate and equipment;
4)  
website banner advertising;
5)  
affiliate fees (incorporation services, financing services, Amazon.com book sales, etc.);

Growth is attained through an aggressive and multi-channel marketing campaign focused on user demographics.  Many Internet-based start-ups and their potential investors quickly look for IT-related specialists to lead the company.  Although SellMyBusiness.com is an Internet-based firm, management believes the business is based more heavily on a “marketing-to-the-proper-user” and “solution provider” model, rather than an “IT-based” model.  The co-founders already have prior experience in launching web-based companies and implementing sophisticated enterprise and CRM software.  Currently, web development and support is provided by one of the leading firms in the state, but will be brought inside the company if deemed appropriate.  However, management stresses that SellMyBusiness.com is a solution provider company for business buyers and sellers that runs on the web, not a web-based company that happens to provide solutions for business people.

The Concept

SellMyBusiness.com was developed to fill a need in the marketplace. The Internet is gradually moving from a product and service sales model to a solutions sale model. SellMyBusiness.com is a complete business solution selling model and provides a full complement of services needed to support the transition of a business from one owner to another, addressing the difficulty in finding these services, and how technology can play a part in providing a total solution.
  
Unique Value Propositions

Currently there are multiple competitive websites acting as repositories for buyers and sellers of businesses, real estate and equipment, but nearly all only focus on one of these three elements.  Nine unique value propositions make SellMyBusiness.com significantly different than its competition and place it in a leadership role in the marketplace.

1.  
Total Selling Solution.  None of the competitive websites merge all facets of buying or selling a business such as: the sale or purchase of the business entity and its related commercial property; the sale of its inventory and all types of equipment, and; assistance in finding professional help to support the transaction such as attorneys, accountants, business valuators and financiers.  Viewers want (and need) a condensation of information and sources.  Said another way, the Internet is graduating from product sales to solution sales.  SellMyBusiness.com is the solution sale for businesses.
 
 
2.  
Professional Service Provider Referrals.  SellMyBusiness.com has created a special web section to enlist paid membership from service providers such as accountants, banks, lawyers, and business valuators to help with introductions to clients in need of their services.  Over fifty categories have been identified.

3.  
Multi-media Marketing and Live Support.  Current competitive websites lack presence in the marketplace, capturing only 5%-18% of all businesses for sale.  Based on management’s research, competitive sites rely primarily on Internet search engine optimization and online advertising

SellMyBusiness.com creates a shift in this strategy by utilizing the global reach of the Internet coupled with targeted multimedia advertising and public relations campaigns, and live support.  A recent article from the editors at Business.com stressing this value about SellMyBusiness.com states, “And here’s something unique: live reps are available to answer questions by phone!”1 The result of these two market concepts is a company that exploits the Internet’s strengths – primarily data driven – coupled with effective marketing and real people to provide a truly unique, personal and valuable service.

4.  
Designed for Non-Web Focused Customers.  The average age of business owners in the U.S. is 56 years (the same in Australia and New Zealand).2 3 This age group is certainly not ignorant of the web, but they do not spend as much time surfing the web as other younger demographic groups.  SellMyBusiness.com management has thus targeted a portion of its marketing on this user demographic.  Furthermore, the website was developed to be simple, clean and clutter free to simplify navigation for those viewers less web savvy.

5.  
Designed for Short Attention Span Viewers.  Executives, business owners and entrepreneurs traditionally have short attention spans.  In order to provide important information about the site without the need to read text, SellMyBusiness.com utilizes an online web actor to speak directly to the viewer.  No competitor uses web actors.

6.  
Local Language Website. Although the language of the Internet is English, not all website viewers speak English.  Thus, SellMyBusiness.com intends to launch culturally relevant versions of the site in multiple foreign languages.

7.  
The Business Vault®.  SellMyBusiness.com offers a unique feature, the Business Vault Confidential Listing Service: a completely private and confidential place to list a business, real estate and equipment for sale and receive leads only from financially pre-qualified buyers.  Many business owners and executives do not wish to publicly list, but would utilize the Internet if they knew their information could be kept confidential and they would only receive contact from parties that have the financial wherewithal for the transaction.

8.  
Business Watch®.  Business Watch provides a service to buyers, allowing them to conduct a search for businesses, real estate or equipment and then lock in the search criteria.  Then, whenever a listing meeting their search criteria is added to the SellMyBusiness.com database the Business Watch service automatically generates an email alerting the potential buyer to the new listing.  Business Watch assures the buyer will not miss any viable purchasing opportunities.

9.  
Web-based Document Management Portal.  Once a business, real estate or equipment purchase is agreed upon by a buyer and seller, SellMyBusiness.com can provide a unique, centralized document management system that allows all parties involved in the transaction (buyer, seller, attorneys, brokers, mortgagers, etc.) to upload and share documents.  SellMyBusiness.com management has made an exclusive arrangement with the developer of this document management system, a company that has also developed special web-based real estate listing modules currently used by international business brokers and an international broker association..
 
______________________________________
1 Technology Insider – News and Views from Business.com editors; Kehrer, Daniel, May 12, 2008, Business.com
2 Business Enterprise Institute; Brown John, 2007.
3 What it means to be a baby boomer!; Dibb, Sharon, Bstar Pty Ltd., 2007.
 
 
The Market

According to the U.S. Census Bureau there are approximately 13.1 million firms in the U.S., generating over $22 billion in annual sales.4 The total number of businesses that are for sale annually just in the United States is estimated to be 1.1 million5 and this number is expected to continue increasing as Baby Boomers sell off their companies to the upcoming generations.  John Brown of the Business Enterprise Institute states one out of two business owners in the country [U.S.] plan on leaving their business within the next ten years.6 SellMyBusiness.com management estimates that Europe and the Asia-Pacific region triple this number.

The initial target market for SellMyBusiness.com is:

·
the 1.1 million sellers of businesses (and related real estate and equipment) in the U.S.;
·
the resulting 1.1 million buyers of businesses;

·
the broker/dealer network that will assist in the buying and selling of these businesses;
·
the individuals (For Sale By Owners) that choose not to enlist the services of brokers, and;

·
the professional service providers that provide a vast array of services for buyers & sellers.

Follow-on growth includes expansion of local language versions of SellMyBusiness.com into targeted countries.  SellMyBusiness.com management’s estimate for the worldwide market is over 60 million companies with approximately 10 percent changing hands each year.  Approximately 20 million firms each exist in the Americas, Europe and Asia/Middle East.  This estimate is based on data on China, India, Europe, Russia and Brazil789.  A more dramatic market size picture is drawn from a Global Entrepreneurship Monitor study stating that out of the 40 GEM countries, accounting for almost 4 billion out of a world population of 6.3 billion, about 50 million new companies will be launch each year (about 137,000 per day) with a subsequent number of firms being closed (potentially sold).10

Competition & Supporting Financial Model

Three types of competitors exist for SellMyBusiness.com: 1) current web-based sites; 2) local and regional broker sites, and; 3) vertical market specialists.

Competition - Current Web-based Sites
There are eight direct competitors to SellMyBusiness.com within the business sales arena (i.e. not including real estate and equipment).  This may appear to be an indicator of a saturated market to most, but in fact it provides strong insight into some critical areas.

Current Web-based Sites
 
Domain Name
Owner
Location
Launched
# of Bus. For Sale
# of Reg. Buyers
# of Agents, Brokers, ect.
Countries Listed
Selling Fee
($/mo)
Broker Fee
($/mo)
Visits/ Searches per. mo.
BizBuySells.com
LoopNet, Inc.
San Francisco, CA
1996
48,000
24,000
2,500
24
59.95
49.95
650,000
BizQuest.com
Bizquest, LLC
Los Angeles, CA
2005
42,000
100,000
n/a
33
54.95
39.95
n/a
BusinessBroker.net
BusinessBroker.net
Atlanta, GA
Est 1999
30,000
n/a
n/a
15
99.95
39.95
500,000
BusinessDistrict.com
Business District, LLC
Shawnee, KS
2006
998
n/a
n/a
1
Free
Free
n/a
BusinessesFor Sale.com
Dynamics PLC
London, UK
1996
51,000
200,000
1,000
110
79.95
29.95
330,000
BusinessMart.com
Business Mart, Inc.
Parlin, NJ
2003
n/a
n/a
n/a
2
69.95
34.95
n/a
BusinessNation.com
Itm Holdings, LLC
Lakewood, CO
1998
2,300
n/a
n/a
1
29.95
39.95
n/a
DaltonBusiness.com
Untied Business Media Ltd.
London, UK
2001
25,000
n/a
n/a
9
£60 ($121)
n/a
n/a
SellMyBusiness.com
SellMyBusiness.com Inc.
Bingham Farms, MI
2008
3,500
Too new
Too new
1
59.95
29.95
550,000
 
 
First, none of these companies appears to have exploited the market based on the small market share. Research indicates the primary marketing methods used by the competition is Internet Search Engine Optimization (SEO). SellMyBusiness.com management has been unable to identify any significant marketing used by any of the companies, except LoopNet which owns BizBuySell.  BizBuySell has an affiliate arrangement with Wall Street Journal Online and runs small ads in business publications such as Fast Company.  BusinessNation.com appears to be unfocused and offering business listing services as only one small piece of a larger strategy; resulting in only 2,300 listings.  BusinessDistrict.com is basing its growth model on business social networking.   The remaining six sites appear to rely on Internet search engine results.  Of the 1.1 million companies sold in the U.S. each year, SellMyBusiness.com management estimates the amount listed online represents less than one percent of the total world market potential.
____________________________________________
4 2004 United States Census Bureau data.
5 2005 Business Reference Guide; West, Tom, 2005.
6 Business Enterprise Institute; Brown, John, 2007.
7 “Registered SMEs in China surpass 4.3 million”, Li Zibin, China Knowledge, Oct 22, 2007
8 “Growth Opportunities for Indian SME’s”, Deloitte Touche Tohmatsu India Private Limited (Source: Ministry of Micro, Small and Medium Enterprises, Government of India), Apr 22, 2008, pg 5,
9 “General Market Outlook – Macroeconomic Projections [on Brazil]”, Canadian Heritage, www.pch.gc.ca, 2008.
10 “Small Business”, Mason, Moya K., (Source: 2002 Global Entrepreneurship Monitor survey), www.moyak.com, 2008.
 
Although these sites are considered direct competitors which may indicate the need to capture market share from them, SellMyBusiness.com personnel have conducted field studies that verify business owners and brokers sign up on multiple sites to ensure market visibility. Therefore, SellMyBusiness.com’s growth is based on customers listing solely with SellMyBusiness.com and jointly with its competitors.

The following chart shows a matrix comparing the features and unique value propositions offered by SellMyBusiness.com relative to its competitors.

Figure 6:  SellMyBusiness.com Features versus Competition
 
 
1 Adding multilingual sites in 2009-10
2 For brokers only
3 Sponsored links only
4 Five categories only
 
 
Competition - Local and Regional Broker Sites
The second area of competition is the myriad of local and regional broker websites.  These sites are not considered viable competitors due to their limited reach and local or regional focus.

Competition - Vertical Market Specialists
The third type of competitor is the web-based specialty market seller.  These firms focus on a narrow niche business industry and essentially hook up sellers with brokers within that niche.  However, as mentioned in the previous “Competition - Current Web-based Sites” paragraph, due to the modest fees for the listing and registration service, business owners and brokers list in multiple sites to ensure market visibility.

Website Visitor Analytics

The SellMyBusiness.com website incorporates rich analytical tools for assessing information about website traffic and visitors such as: sessions, pageviews, hits, requested pages, downloads (from the SellMyBusiness.com website), page drilldowns, entrance pages, exit pages, bounce rates, click paths, length of pageview, depth of session, length of session, referrals, domains, user IP addresses, browser details, and reasons for de-listing.

The capture and translation of this data into visitor demographics creates a powerful tool for SellMyBusiness.com management for pricing banner advertisement, affiliate arrangements, corporate sponsorships and, potentially, company purchase.

Intellectual Property

SellMyBusiness.com has secured three registered service marks:

1.  
The subsidiary company name and, thus, its domain name: SellMyBusiness.com®
2.  
The confidential listing and pre-qualified buyer service:  Business Vault®
3.  
The business listing alert service:  Business Watch®

Employees

As of April 10, 2009, the Company had three employees.  The Company plans to hire more persons on as-needed basis.  The Company has not entered into any collective bargaining agreements. 
 
DESCRIPTION OF PROPERTY

Our mailing address is located at 10755 Vernon Avenue, Huntington Woods, MI 48070. Phone-based web support is located at 10755 Vernon, Huntington Woods, MI 48070 at a facility cost of $1,500 per month.

LEGAL PROCEEDINGS

John C. Maddox, our President, Chief Operating Officer and Director, is subject to certain payments under a Chapter 13 Plan approved by United States Bankruptcy Court on June 13, 2007. He paid $600 per month to certain creditors from May 31, 2007 to September 30, 2008. He is now paying $669.04 per month to these creditors for twelve months, effective October 1, 2008.

Except stated above, there are no legal proceedings pending or threatened against us or our officers and directors.
 
 
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
 
Our common stock has been traded on the OTCBB under the symbol “HALB.OB” since June 10, 2009. However, our common stock was thinly traded in the public market. From June 10, 2009 to July 7, 2009, the highest trading price was $0.75 per share and the lowest trading price was $0.10 per share.

Holders of Our Common Stock
 
As of the date of this registration statement, we had 50 shareholders of our common stock.

Rule 144 Shares
 
After July 2009, all of the shares of our common stock held by 39 shareholders who purchased their shares in the Regulation D 506 offering by us will become available for resale to the public without any restriction.
 
Stock Option Grants
 
To date, we have not granted any stock options.
 
Transfer Agent and Registrar
 
Our transfer agent is Globex Transfer, LLC, 780 Deltoan Blvd., Suite 202, Deltona, Florida 32725 and its phone number is (386)206-1133.
 
Dividend Policy
 
Since inception we have not paid any dividends on our common stock. We currently do not anticipate paying any cash dividends in the foreseeable future on our common stock, when issued pursuant to this offering. Although we intend to retain our earnings, if any, to finance the exploration and growth of our business, our Board of Directors will have the discretion to declare and pay dividends in the future. Payment of dividends in the future will depend upon our earnings, capital requirements, and other factors, which our Board of Directors may deem relevant.
 
 
 

 
AVAILABLE INFORMATION
 
We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the common stock offered hereby. This prospectus, which constitutes part of the registration statement, does not contain all of the information set forth in the registration statement and the exhibits and schedule thereto, certain parts of which are omitted in accordance with the rules and regulations of the SEC. For further information regarding our common stock and our company, please review the registration statement, including exhibits, schedules and reports filed as a part thereof. Statements in this prospectus as to the contents of any contract or other document filed as an exhibit to the registration statement, set forth the material terms of such contract or other document but are not necessarily complete, and in each instance reference is made to the copy of such document filed as an exhibit to the registration statement, each such statement being qualified in all respects by such reference.
 
We are also subject to the informational requirements of the Exchange Act which requires us to file reports, proxy statements and other information with the SEC. Such reports, proxy statements and other information along with the registration statement, including the exhibits and schedules thereto, may be inspected at public reference facilities of the SEC at 100 F Street N.E , Washington D.C. 20549. Copies of such material can be obtained from the Public Reference Section of the SEC at prescribed rates. You may call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference room. Because we file documents electronically with the SEC, you may also obtain this information by visiting the SEC’s Internet website at http://www.sec.gov.
 
 

 
 
 
HALBERD CORPORATION AND
SUBSIDIARY
(a development stage company)
Huntington Woods, Michigan


For the Three and Nine Months Ended
April 30, 2009 and April 30, 2008 and
August 2, 2007 (date of inception) to April 30, 2009
 
 
 

 


HALBERD CORPORATION AND
SUBSIDIARY
(a development stage company)
Huntington Woods, Michigan

INTERIM CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Nine Months Ended
April 30, 2009 and April 30, 2008 and
August 2, 2007 (date of inception) to April 30, 2009

 
 
 
 

 
HALBERD CORPORATION AND
SUBSIDIARY
(a development stage company)

TABLE OF CONTENTS

 
TABLE OF CONTENTS
 
 
 
Interim Consolidated Financial Statements
Page
   
Review Report of Independent Registered Public Accounting Firm
1
   
Consolidated Balance Sheets as of April 30, 2009 (unaudited) and July 31, 2008
2
   
Consolidated Statements of Operations for the three and nine months ended
 
   April 30, 2009 and 2008 and August 2, 2007 (date of inception) to April 30, 2009 (unaudited)
3
   
Consolidated Statements of Stockholders’ Equity (Deficit) for the nine months
 
   Ended April 30, 2009 and period ended April 30, 2008 (unaudited)
4
   
Consolidated Statements of Cash Flows for the nine months ended
 
   April 30, 2009 and 2008 and August 2, 2007 (date of inception) to April 30, 2009 (unaudited)
5
   
Notes to Interim Consolidated Financial Statements
6-15
 
 

 

 

 
REVIEW REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
June 18, 2009
 
Board of Directors and Stockholders
 
Halberd Corporation and Subsidiary
 
Huntington Woods, Michigan
 
We have reviewed the consolidated balance sheet of Halberd Corporation and Subsidiary, a development stage company (the Company) as of April 30, 2009, the related consolidated statements of operations for the three and nine month periods ended April 30, 2009 and 2008, and the related consolidated statements of stockholders’ equity (deficit) and cash flows for the nine-month periods ended April 30, 2009 and 2008. These consolidated financial statements are the responsibility of the Company’s management.
 
We conducted our reviews in accordance with the standards established by the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards established by the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion regarding the consolidated financial statements taken as a whole. Accordingly, we do not express such an opinion.
 
Based on our reviews, we are not aware of any material modifications that should be made to the consolidated financial statements referred to above in order for them to conform with accounting principles generally accepted in the United States of America.
 
We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Halberd Corporation and Subsidiary as of July 31, 2008, and the related consolidated statements of operations, stockholders’ deficit, and cash flows for the period August 2, 2007 through July 31, 2008 (not presented herein); and in our report dated January 29, 2009, we expressed an unqualified opinion on those consolidated financial statements.  In our opinion, the information set forth in the accompanying consolidated balance sheet as of July 31, 2008, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Rehmann Robson

Rehmann Robson, P.C.

Troy, Michigan
 
 
 
 
 
HALBERD CORPORATION AND SUBSIDIARY
 
(a development stage company)
 
   
CONSOLIDATED BALANCE SHEETS
 
             
             
 
 
April 30
   
July 31,
 
   
2009
   
2008
 
   
(Unaudited)
       
ASSETS
 
             
Cash and cash equivalents, equal to total current assets
  $ 6,854     $ 1,387  
                 
Prepaid expenses
    9,500       -  
                 
Property and equipment, net
    551,940       314,221  
                 
Trademarks
    19,245       8,770  
                 
Deferred income taxes
    -       17,330  
                 
Total assets
  $ 587,539     $ 341,708  
                 
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
         
                 
Liabilities
               
Accounts payable
  $ 291,989     $ 17,959  
Accrued expenses
    22,542       17,386  
Deferred revenue
    2,428       1,510  
Due to officers
    124,890       30,048  
Line-of-credit due to stockholder
    29,027       10,900  
Promissory notes payable
    55,000       -  
Convertible notes payable
    -       300,000  
                 
Total liabilities (all current)
    525,876       377,803  
                 
Stockholders' equity (deficit) (Note 6)
               
Common stock - $0.001 par value; 120,000,000 shares
               
authorized, 26,058,000 and 20,002,000 shares issued and
               
outstanding at April 30, 2009 and July 31, 2008,
               
respectively
    1,505       -  
Additional paid-in capital
    632,950       -  
Deficit accumulated during the development stage
    (572,792 )     (36,095 )
                 
Total stockholders' equity (deficit)
    61,663       (36,095 )
                 
Total liabilities and stockholders' equity (deficit)
  $ 587,539     $ 341,708  
                 
 
 
The accompanying notes are an integral part of these interim consolidated financial statements
 
F1

 
HALBERD CORPORATION AND SUBSIDIARY
 
(a development stage company)
 
                     
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
 
                               
                               
                           
Cumulative
 
                           
Period From
 
                           
August 2, 2007
 
                           
(date of inception)
 
   
Three Months Ended April 30
   
Nine Months Ended April 30
   
to April 30
 
   
2009
   
2008
   
2009
   
2008
   
2009
 
                               
Net sales
  $ 587     $ 1,546     $ 5,679     $ 1,546     $ 12,695  
                                         
Cost of sales
    538       218       1,451       218       2,097  
                                         
Gross margin
    49       1,328       4,228       1,328       10,598  
                                         
Operating expenses
    365,559       157,669       501,349       215,151       545,436  
                                         
Operating loss
    (365,510 )     (156,341 )     (497,121 )     (213,823 )     (534,838 )
                                         
Interest income
    -       620       -       620       1,253  
Interest expense
    (6,547 )     (2,380 )     (22,246 )     (10,617 )     (39,207 )
                                         
Other expense, net
    (6,547 )     (1,760 )     (22,246 )     (9,997 )     (37,954 )
                                         
Loss before income taxes
    (372,057 )     (158,101 )     (519,367 )     (223,820 )     (572,792 )
                                         
Income taxes
    -       -       (17,330 )     -       -  
                                         
Net loss
  $ (372,057 )   $ (158,101 )   $ (536,697 )   $ (223,820 )   $ (572,792 )
                                         
Basic and diluted loss per common share
    *       *       *       *       *  
                                         
Weighted average number of common
                                       
shares outstanding, basic and fully diluted
    25,558,000       10,001       22,415,775       10,001       20,080,276  
                                         
* less than $0.01
                                       
 
 
The accompanying notes are an integral part of these interim consolidated financial statements
 
F2

 
 
HALBERD CORPORATION AND SUBSIDIARY
 
(a development stage company)
 
   
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (UNAUDITED)
 
   
                               
               
Additional
   
Deficit Accumulated
During the
   
Total
 
   
Common Stock
   
Paid-in
   
Development
   
Stockholders'
 
   
Shares
   
Amount
   
Capital
   
Stage
   
Deficit
 
                               
Balances - August 2, 2007
    -     $ -     $ -     $ -     $ -  
                                         
Common stock issued
    10,001       -       -       -       -  
                                         
Net loss
    -       -       -       (223,820 )     (223,820 )
                                         
Balances - April 30, 2008
    10,001     $ -     $ -     $ (223,820 )   $ (223,820 )
                                         
                                   
 
 
                   
Additional
   
Deficit Accumulated
During the
   
Total
Stockholders'
 
   
Common Stock
   
Paid-in
   
Development
   
Equity
 
   
Shares
   
Amount
   
Capital
   
Stage
   
(Deficit)
 
                                         
Balances - August 1, 2008 *
    20,002,000     $ -     $ -     $ (36,095 )   $ (36,095 )
                                         
Conversion to equity of notes
                                       
payable and accrued interest
    4,600,000       460       322,540       -       323,000  
                                         
Private placement during January
                                       
2009 at $0.22/share
    374,000       37       80,963       -       81,000  
                                         
Shares issued for consulting
                                       
services during January 2009
                                       
at $0.25/share
    82,000       8       20,492       -       20,500  
                                         
Shares issued for consulting
                                       
services during March 2009
                                       
at $0.25/share
    1,000,000       1,000       249,000       -       250,000  
                                         
Direct filing costs associated with
    -       -       (40,045 )     -       (40,045 )
registration of common shares
                                       
                                         
Net loss
    -       -       -       (536,697 )     (536,697 )
                                         
Balances - April 30, 2009
    26,058,000     $ 1,505     $ 632,950     $ (572,792 )   $ 61,663  
                                         
 
* As adjusted to reflect recapitalization - Note 1
                                 
 
 
The accompanying notes are an integral part of these interim consolidated financial statements
 
F3

 
 
HALBERD CORPORATION AND SUBSIDIARY
 
(a development stage company)
 
         
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
 
                   
                   
               
Cumulative
 
               
Period From
 
               
August 2, 2007
 
               
(date of inception)
 
   
Nine Months Ended April 30
   
to April 30
 
   
2009
   
2008
   
2009
 
Cash flows from operating activities
                 
Net loss
  $ (536,697 )   $ (223,820 )   $ (572,792 )
Adjustments to reconcile net loss to net cash
                       
provided by (used in) operating activities
                       
Depreciation
    2,135       730       3,558  
Deferred income tax valuation allowance
    17,330       -       -  
Changes in operating assets and liabilities that
                 
provided (used) cash
                       
Prepaid expenses
    (9,500 )     (460 )     (9,500 )
Accounts payable and accrued expenses
    532,641       9,377       567,986  
Deferred revenue
    918       -       2,428  
Due to officers
    94,842       48       124,890  
Net cash provided by (used in)
                       
operating activities
    101,669       (214,125 )     116,570  
                         
Cash flows from investing activities
                       
Trademark costs
    (10,475 )     (3,162 )     (19,245 )
Purchases of property and equipment,
                       
   including website costs
    (239,854 )     (67,537 )     (555,498 )
                         
Net cash used in investing activities
    (250,329 )     (70,699 )     (574,743 )
                         
Cash flows from financing activities
                       
Net stockholder line-of-credit borrowings
    18,127       -       29,027  
Issuance of promissory notes payable
    55,000       -       55,000  
Issuance of convertible notes payable
    -       300,000       300,000  
Proceeds from private placement, net of
                       
offering costs of $ 12,500
    81,000       -       81,000  
                         
Net cash provided by financing activities
    154,127       300,000       465,027  
                         
Net increase in cash and cash equivalents
    5,467       15,176       6,854  
                         
Cash and cash equivalents - beginning of period
    1,387       -       -  
                         
Cash and cash equivalents - end of period
  $ 6,854     $ 15,176     $ 6,854  
                         
Supplemental disclosures of noncash financing activities:
                 
                         
Issuance of 1,082,000 shares of common stock in
                       
exchange for consulting services
  $ 270,500     $ -     $ 270,500  
                         
Conversion of notes payable to common stock
  $ 323,000     $ -     $ 323,000  
                         
Direct filing costs associated with
                       
registration of common shares
  $ (40,045 )   $ -     $ (40,045 )
 
 
The accompanying notes are an integral part of these interim consolidated financial statements
 
F4

 
HALBERD CORPORATION AND SUBSIDIARY
(a development stage company)

NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
 


1.  
BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Principles of Consolidation

The consolidated financial statements include the accounts of Halberd Corporation and its wholly owned subsidiary Sellmybusinessnow.com, Inc.  All intercompany balances and transactions have been eliminated in consolidation.

Organization, Nature of Business (including development stage), and Basis of Presentation

Sellmybusinessnow.com, Inc., is a development stage company that was incorporated under the laws of the state of Michigan on August 2, 2007.  The Company began operating under the name “Sellmybusiness.com®” on December 3, 2007.  To date, the Company’s activities have been limited to raising capital, obtaining financing, constructing its website and administrative functions. Sellmybusiness.com® intends to provide a single web portal for interested parties to find, buy and sell businesses, real estate and equipment and all the related services needed to support the transaction, including financing, incorporation, professional help and additional business resources.  Sellmybusiness.com® intends to support businesses of all sizes and types, including start-ups, well-established companies, home-based businesses, closely-held companies, multinational public corporations and franchises. Sellmybusiness.com®’s real estate listing service will assist business people to buy, sell, lease or sublease commercial land and property. Sellmybusiness.com®’s equipment listing service will provide a portal to buy, sell or lease excess inventory, capital equipment, raw materials, vehicles, aircraft, ships and rail equipment.

On January 26, 2009, Halberd Corporation, a Nevada corporation, was formed by Sellmybusinessnow.com, Inc.’s founders in conjunction with a legal reorganization of the Company.  Halberd Corporation is structured to act as the parent company of Sellmybusinessnow.com, Inc.  As part of this action, and effective on January 28, 2009, all of the issued and outstanding shares of Sellmybusinessnow.com, Inc. common stock were exchanged on a 2,000-to-1 basis for Halberd Corporation common stock.  As a result, the accompanying consolidated financial statements reflect this reorganization and are presented on a consolidated basis and are labeled as those of the parent company.  Halberd Corporation and Subsidiary are collectively referred to as the “Company”.

The Company has adopted a fiscal year end of July 31.
 
 
 
HALBERD CORPORATION AND SUBSIDIARY
(a development stage company)

NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
 



Basis of Accounting

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles (U.S. GAAP) for interim financial information.  In the opinion of management, all adjustments considered necessary for a fair presentation have been included.  The results of operations for the nine months ended April 30, 2009 are not necessarily indicative of the results that may be expected for the year ended July 31, 2009.

Use of Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States 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 consolidated financial statements and the reported amounts of income and expenses during the reporting period.  Actual results could differ from those estimates.

Segment Reporting

The Company has determined that it does not have any separately reportable business segments at April 30, 2009.

Cash and Cash Equivalents
 
Cash and cash equivalents consist of cash on hand and demand deposits in banks.  The Company considers all highly liquid investments purchased with original maturities of six months or less to be cash equivalents.
 
Revenue Recognition

The Company utilizes the guidance in Securities and Exchange Commission (SEC) Staff Accounting Bulletin (SAB) No. 104, Revenue Recognition, to recognize revenue.  Under SAB No. 104, revenue is recognized only when persuasive evidence of an agreement exists, delivery of the service has occurred, the sales price is fixed or determinable and collectability is reasonably assured. Payments received in advance of services being rendered are recorded as deferred revenue and recognized on a straight-line basis over the service period.
 
 
 
HALBERD CORPORATION AND SUBSIDIARY
(a development stage company)

NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
 



As the Company is in the development stage, it has generated limited revenues during the period ended April 30, 2009.  Management believes the Company will principally derive its future revenue from customers that pay fees via credit card through the web site for a suite of services to market and search for commercial real estate and operating businesses. These services include a premium membership that provides the customer unlimited access to listings, maximized exposure for their listings, along with enhanced services to market their listings.

Management also anticipates the Company will earn revenue from other sources including advertising revenues, which will be recognized ratably over the period in which the advertisement is displayed on the web site, provided that no significant obligations remain and collection of the resulting receivable is probable. Advertising rates are dependent on the services provided and the placement of the advertisements.

Property and Equipment (including web site costs)

Costs incurred to develop the Company’s web site, Sellmybusiness.com®, are capitalized or expensed, as applicable, in accordance with the Financial Accounting Standards Board’s Emerging Issues Task Force Issue 00-2, Accounting for Web Site Development Costs (EITF 00-2), which addresses whether certain development costs should be capitalized or expensed.  Exhibit 00-2A of EITF 00-2 breaks potential web site development costs into 34 distinct potential activities, among four stages: Planning; Web Site Application and Infrastructure Development; Graphics and Content Development; and Operating.  Management analyzes the nature of costs incurred relative to these stages and either capitalizes or expenses the related costs in accordance with EITF 00-2.   Because the Company’s current web site development costs incurred relate principally to development and testing, the Company is generally capitalizing these costs.

Management periodically reviews these assets to determine whether carrying values have been impaired.

Depreciation and Amortization

Depreciation on equipment is computed using the straight-line method over the estimated useful lives of the related assets which range from three to seven years.  Amortization of web site costs did not commence during the period ended April 30, 2009 since the final operating version of the site was not completed as of that date.

Trademark Costs

The Company has capitalized costs to obtain trademarks registered for its three service marks Sellmybusiness.com®, Business Vault®, and Business Watch®.   Such costs principally relate to legal fees incurred.  These intangible assets have been determined to have a life of 15 years and the Company will begin amortizing them when full website operations begin (scheduled for July 2009).
 
 
 
HALBERD CORPORATION AND SUBSIDIARY
(a development stage company)

NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
 



Income Taxes

Deferred income tax assets and liabilities are computed annually for differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future, based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income.  Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.  Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred tax assets and liabilities.  Deferred income taxes relate principally to the Company’s net operating loss carry forward.

Concentration Risks

Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents and when they exist, trade accounts receivable.  Cash and cash equivalents are deposited with high credit quality financial institutions.  The Company’s revenue and accounts receivable are primarily derived from credit card transactions with subscribers and are typically settled within two to three business days.

Fair Value of Financial Instruments

The Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities, are carried at cost, which approximates their fair value because of the short-term maturity of these instruments.

Net Income (loss) Per Share

Net income (loss) per share is calculated under the provisions of Statement of Financial Accounting Standards (SFAS) No. 128, Earnings Per Share.  “Diluted” reflects the potential dilution of all common stock equivalents except in cases where the effect would be anti-dilutive.  Common stock equivalents of 4,508,000 were excluded from net loss per diluted share for all prior periods presented as this effect would have been anti-dilutive.  These common stock equivalents were converted to common stock during January 2009 and as such are reflected in weighted average common shares outstanding for the periods ended April 30, 2009.
 
 
 
 
HALBERD CORPORATION AND SUBSIDIARY
(a development stage company)

NOTES TO UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
 



Recent Accounting Pronouncements

In April 2009, the Financial Accounting Standards Board (FASB) issued three related Staff Positions (FSP): (i) FSP 157-4, “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability have Significantly Decreased and Identifying Transactions That Are Not Orderly”, (ii) FSP Statement of Financial Accounting Standard (SFAS) 115-2 and SFAS 124-2,  “Recognition and Presentation of Other-Than-Temporary Impairments”,  and (iii) FSP SFAS 107-1 and Accounting Principles Board (APB) 28-1, “Interim Disclosures about Fair Value of Financial Instruments”, each of which will be effective for interim and annual periods ending after June 15, 2009. FSP 157-4 provides guidance on how to determine the fair value of assets and liabilities under SFAS 157 Fair Value Measurements, in the current economic environment and reemphasizes that the objective of a fair value measurement remains the determination of an exit price. FSP SFAS 115-2 and SFAS 124-2 modify the requirements for recognizing other-than-temporarily impaired debt securities and revise the existing impairment model for such securities by modifying the current intent and ability indicator in determining whether a debt security is other-than-temporarily impaired. FSP SFAS 107 and APB 28-1 enhance the disclosure of instruments under the scope of SFAS 157 for both interim and annual periods. We are currently evaluating the potential impact of these Staff Positions.

In December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business Combinations,” (SFAS 141(R)), which replaces SFAS 141. SFAS 141(R) establishes principles and requirements for recognition and measurement of assets, liabilities and any non-controlling interest acquired due to a business combination. Under SFAS 141(R) the entity that acquires the business (whether in a full or partial acquisition) may recognize only the assets acquired, the liabilities assumed, and any non-controlling interest in the acquiree at the acquisition date, measured at fair value. SFAS 141(R) requires the acquirer to recognize goodwill as of the acquisition date, measured as a residual. Under SFAS 141(R), acquisition-related transaction and restructuring costs will be expensed as incurred rather than treated as part of the acquisition cost and included in the amount recorded for assets acquired. SFAS 141(R) is effective for fiscal years beginning after December 15, 2008. Accordingly, the Company will apply the provisions of SFAS 141(R) for acquisitions completed after July 31, 2009.

In April 2009, the FASB issued FSP No. 141R-1, “Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies”. FSP 141R-1 amends the provisions in FASB Statement 141R for the initial recognition and measurement, subsequent measurement and accounting, and disclosures for assets and liabilities arising from contingencies in business combinations. FSP 141R-1 eliminates the distinction between contractual and non-contractual contingencies, including the initial recognition and measurement criteria in Statement 141R and instead carries forward most of the provisions in SFAS 141 for acquired contingencies. FSP 141R-1 is effective for contingent assets and contingent liabilities acquired in 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. We expect that FSP 141R-1 will not have an impact on our consolidated financial statements at this time.
 
 
 
F9