As filed with the Securities and Exchange Commission on August 16, 2000.
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
OneDentist Resources, Inc.
(Name of small business issuer in its charter)
Colorado 514100 31-1664473
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(State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) I.D. Number)
5300 McKitrick Boulevard
Columbus, Ohio 43235
(614) 538-2710
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(Address and telephone number of principal executive offices)
5300 McKitrick Boulevard
Columbus, Ohio 43235
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(Address of principal place of business or
intended principal place of business)
Graydon D. Webb, President
5300 McKitrick Boulevard
Columbus, Ohio 43235
(614) 538-2710
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(Name, address and telephone number of agent for service)
Copies to:
Gary A. Agron, Esq.
5445 DTC Parkway, Suite 520
Englewood, CO 80111
(303) 770-7254
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this registration statement.
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box. |_|
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CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Maximum Maximum Amount of
Title of Each Class of Amount to Offering Price Aggregate Registration
Securities to be Registered Be Registered Per Share Offering Price Fee
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Common Stock, no par value 2,316,250 Shares $2.00 $4,632,500 $1,366
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This registration statement registers the sale of 1,000,000 shares of
common stock by OneDentist Resources, Inc., and the resale of 1,316,250 shares
of common stock offered by our selling stockholders, also valued at $2.00 per
share.
In addition to the number of shares set forth above, the amount to be
registered includes any shares of our common stock issued as a result of stock
splits, stock dividends and similar transactions in accordance with Rule 416.
The Proposed Maximum Offering Price Per Share and the Proposed Maximum
Aggregate Offering Price in the table above are estimated solely for the purpose
of calculating the registration fee pursuant to Rule 457(c) promulgated under
the Securities Act of 1933. These estimates were calculated based on the
offering price of $2.00 per share for the 1,000,000 shares of common stock which
we are offering to the public.
We hereby amend this registration statement on such date or dates as may be
necessary to delay its effective date until we 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
Securities and Exchange 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 we are not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
Dated August 16, 2000
2,316,250 shares of common stock
ONEDENTIST RESOURCES, INC.
We are offering a minimum of 500,000 shares and a maximum of 1,000,000
shares of our common stock for sale at $2.00 per share on a best-efforts basis
without the assistance of an underwriter. In addition, our selling stockholders
are offering up to 1,316,250 shares of our common stock for sale at prevailing
market prices. Until we sell 500,000 shares, the proceeds from the sale of the
shares sold by us will be deposited in an escrow account at Key Bank, Denver,
Colorado.
The selling stockholders may not offer their shares for sale until we close
our up to 1,000,000 share offering and our common stock is listed for trading on
the Nasdaq Over-the-Counter Bulletin Board Trading System.
There is no public market for our common stock and no assurance that a
market will develop.
Investing in our common stock involves substantial risks. See "Risk
Factors" beginning on page 5.
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Offering Commissions and Net Proceeds
Discounts
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Per Share $2.00 $.26 $1.74
Minimum 1,000,000 $130,000 $870,000
Maximum 2,000,000 $260,000 $1,740,000
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The Securities and Exchange Commission and state securities regulators have
not approved or disapproved these securities or passed upon the adequacy or
accuracy of this prospectus. Any representation to the contrary is a criminal
offense.
The date of this prospectus is ____________, 2000.
TABLE OF CONTENTS
About this Prospectus........................................................3
Summary......................................................................3
Risk Factors ................................................................8
Use of Proceeds.............................................................15
Dilution....................................................................16
Capitalization..............................................................17
Selected Financial Data.....................................................18
Management's Discussion and Analysis of Financial
Condition and Results of Operations..................................19
Business....................................................................20
Management..................................................................27
Security Ownership of Executive Officers, Directors and Beneficial
Owners of Greater than 5% of Our Common Stock.........................31
Selling Stockholders........................................................32
Plan of Distribution........................................................44
Related Party and Other Material Transactions...............................45
Description of Capital Stock................................................45
Shares Eligible for Future Sale.............................................46
Experts.....................................................................47
Legal Matters...............................................................47
Where You Can Find More Information.........................................47
Financial Statements.......................................................F-1
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ABOUT THIS PROSPECTUS
You should rely only on the information contained in this prospectus as we
have not authorized any other person to provide you with different information.
If anyone provides you with different or inconsistent information, you should
not rely on it. We are not making an offer to sell these securities in any
jurisdiction where such an offer or sale is not permitted.
SUMMARY
This summary highlights material information regarding our company and the
offering contained in this prospectus. However, this summary is not complete and
may not contain all of the information that may be important to you. You should
read the entire prospectus carefully, including the financial information and
related notes, before making an investment decision. Unless otherwise
specifically stated, the information in this prospectus assumes that holders of
our securities have not exercised any options or warrants which are currently
outstanding.
Business.
We are a development stage company, organized in July 1999 to design and
develop an on- line Web site for the dental community including dentists, dental
practitioners and dental patients. We distinguish ourselves from other Web-based
dental sites by designing and hosting for our dentists individual, interactive
Web sites. These Web sites allow our dentists to communicate with and market to
their patients and to provide their patients with content and information
tailored specifically to each dentist's practice. In doing so, we offer each
dentist the opportunity to develop and maintain his or her own brand identity
with respect to communication with patients and vendors.
Our OneDentist.com Web site, which we launched in February 2000, combines
innovative business-to-business features for dentists and interactive
business-to-consumer resources for dental patients.
Our initial marketing efforts have included the completion of a strategic
relationship with Oxyfresh Worldwide, a network of over 10,000 dentists. Our
management is assisted by a board of directors that includes three dentists
recognized as experts in dental practice enhancement, dental course design and
advanced practice management.
For dentists, our OneDentist.com Web site currently offers:
o A personalized dental practice Web site designed with our resources;
o Web hosting and interactive communication using e-mail to set
appointments, deliver appointment reminders and answer patient
questions;
o Standardized dental office procedures, manuals and forms;
o The ability to purchase dental supplies and other goods and services
on-line;
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o Educational features including dental news, classified advertisements,
continuing dental education programs, marketing research and
statistical profiles of other dental practices; and
o Patient referrals and relationship development through our Web site.
In addition to the above, we are currently developing Web-based application
software which will provide billing, scheduling, insurance and tools for managed
care benefits to our dentists. We are also negotiating strategic relationships
which we believe will allow us to provide financial, insurance and professional
employment organization services to our dentists. In the future, we intend to
offer our dentists on-line access to our dental office procedure manuals and
dental forms.
For dental patients, our OneDentist.com Web site currently offers:
o A dentist finder search-engine, which enables consumers to locate and
compare dentists by geographical location;
o In-depth information on dental practices including location, map
finding, areas of specialty, insurance information and backgrounds on
practitioners;
o Dental education, including dental health news and articles on dental
treatments;
o Interactive communication with the dental practice through e-mail,
including scheduling arrangements, billing inquiries, insurance
information and general questions; and
o Dental products for sale.
We also intend to offer dentistry-related chat rooms and message boards.
Our Market Opportunity.
According to the American Dental Association, in 1999 dental practice
revenue in the United States exceeded $50 billion with an additional $15 billion
generated from the sale of dental supplies and dental equipment. The ADA also
reported that in December 1995 there were 150,000 dentists and 300,000 staff
personnel in 113,000 general dental practices. Over 72% of those dental
practices were operated by single practitioners. We believe that most of these
single-practitioner offices do not have the marketing and administrative support
available to larger dental practices and, accordingly, represent our primary
target market.
The Internet offers us the opportunity to reach dental practitioners as
well as dental patients. According to IDC, worldwide transactions on the
Internet are expected to increase from approximately $32 billion in 1998 to
approximately $426 billion in 2002, with the number of users that have purchased
products and services on-line rising from approximately 28 million to
approximately 128 million worldwide during the same period. Forester Research
estimates that US- based, business-to-business Internet commerce will grow to
$1.3 trillion in 2003, which is more than ten times the $108 billion estimated
to be spent on business-to-consumer transactions in 2003. OneDentist.com is
designed to take advantage of the significant growth in both
business-to-consumer as well as business-to-business transactions by providing
products and services on-line to dental practitioners and patients.
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Strategy.
Our goal is to become a leading Web destination for both dental
professionals and dental patients by providing an interactive Web site, tailored
to the specific needs of each practitioner. In order to achieve our goal we
intend to:
Increase the number of dental practitioners using our Web site by:
o Continuing to develop strategic relationships with dental
practice associations, insurance providers, billing services and
practice management groups;
o Entering into vendor arrangements with dental product
manufacturers and wholesalers as well as non-dental product and
service providers;
o Offering innovative Web-based back-office management software for
dental practitioners;
o Developing direct marketing programs to attract small- to
medium-sized dental practices;
o Sponsoring dental trade meetings, promotional events and
mentoring programs; and
o Offering value-priced dental products for practitioners.
o Increase the number of dental patients using our site by:
o Offering a user-friendly guide to selecting dentists in the
patient's location;
o Providing interesting and informative news and articles on dental
subjects; and
o Promoting the OneDentist.com brand name through Web-based and
traditional media advertising; and
o Developing multi-lingual versions of our Web site.
o Further expand the functionality of our dentists' Web sites.
o Generate additional revenue through the on-line sale of dental
products, advertising, e-commerce transaction fees and consultation
services.
History.
We were incorporated in Colorado in November 1996 under the name Haleakala
Enterprises, Inc., and acquired all the outstanding shares of OneDentist.com,
Inc., an Ohio corporation, in June 2000. In June 2000 our board of directors
authorized a reverse split of our common stock on the basis of .75 share for
each share outstanding and a name change to OneDentist Resources, Inc. Our
offices are located at 5300 McKitrick Boulevard, Columbus, Ohio 43235, and our
telephone number is (614) 538-2710. All references to share amounts throughout
this prospectus reflect this reverse stock split.
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The Offering.
Securities offered by us: 1,000,000 shares of common stock.
Securities offered by the
selling stockholders: 1,316,250 shares of common stock.
Common stock outstanding
prior to offering: 5,000,000 shares of common stock.
Common stock outstanding
after the offering: 6,000,000 shares of common stock.
Use of proceeds: Marketing expenses, expansion of product
offerings, purchase of equipment, general
and administrative expenses and working
capital.
Proposed Bulletin Board symbol: "WEBD"
Description of Selling Stockholders.
Through this prospectus, we are registering the resale of up to 1,316,250
shares of our common stock by selling stockholders, 221 of whom acquired their
shares in a private placement of our common stock in February 1997 and 16 of
whom received their shares when we acquired all of the outstanding shares of
OneDentist.com, Inc., an Ohio corporation, in June 2000. We currently have
5,000,000 shares of common stock outstanding.
Forward-Looking Statements.
This prospectus includes forward-looking statements. We have based these
forward-looking statements on our current expectations and projections about
future events. These forward-looking statements are subject to risks,
uncertainties and assumptions about us which are discussed in the Risk Factors
section below as well as throughout this prospectus. In light of these risks,
uncertainties and assumptions, the forward-looking events discussed in this
prospectus might not occur.
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Summary Financial Data.
The following summary of historical and pro forma consolidated financial
data should be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and our audited financial
statements and related notes included elsewhere in this prospectus.
Period from July 16,
1999 (date of inception) Four months
through December 31, 1999 ended April 30, 2000
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Total costs and expenses $ 4,401 $ 67,441
Operating loss (4,401) (67,441)
Net loss (4,401) (66,741)
Net loss per share .001 (0.013)
Weighted average number
of shares of common
stock outstanding 5,000,000 5,000,000
Pro Forma Balance sheet Data:
The as adjusted information gives effect to:
Minimum The proforma adjustments and sale of the 500,000 shares offered by
this prospectus, the receipt of estimated net proceeds of $710,000
and the elimination of deferred offering costs of $26,666.
Maximum The proforma adjustments and sale of the 1,000,000 shares offered by
this prospectus, the receipt of estimated net proceeds of $1,580,000
and the elimination of deferred offering costs of $26,666.
Minimum Maximum
Proforma Proforma As adjusted As adjusted
December 31, 1999 April 30, 2000 April 30, 2000 April 30, 2000
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Cash and cash equivalents $ -- $ 259,749 $ 996,415 $ 1,866,415
Total assets -- 286,415 996,415 1,866,415
Total liabilities 2,149 72,805 72,805 72,805
Common stock 1,000 284,752 994,752 1,864,752
Accumulated deficit (4,401) (71,142) (71,142) (71,142)
Stockholders' equity 2,149 213,610 923,610 1,793,610
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RISK FACTORS
The shares of common stock offered by this prospectus involve a high degree
of risk and represent a highly speculative investment. You should not purchase
these shares if you cannot afford the loss of your entire investment. In
addition to the other information contained in this prospectus, you should
carefully consider the following risk factors in evaluating our company, our
business prospects and an investment in our shares of common stock.
We cannot assure you that we will be profitable and may need additional capital.
Our limited operating history, lack of any revenue to date and the
uncertainty of the Internet market in which we operate our business make any
prediction of our future results of operations difficult or impossible. We
expect to increase considerably our operating expenses in the future,
particularly expenses to develop our on-line OneDentist.com, Inc., Web site. We
do not expect that our revenue will cover these expenses. As a result, we expect
to incur significant losses and expect that we will need to raise additional
capital. We cannot assure that we will be able to raise additional capital and
we do not know what the terms of any such capital raising would be. Any future
sale of our equity securities would dilute the ownership and control of our
stockholders and could be at prices substantially below the offering price. Our
inability to raise capital could require us to significantly curtail our
operations.
We have not generated any revenue since beginning operations in July 1999
and have an accumulated deficit from losses totaling $71,142 from that date
through April 30, 2000. In order to achieve profitability, we must develop and
market the OneDentist.com Web site. We cannot assure you that we will ever
achieve broad market acceptance, profitability or positive operating cash flow.
We have received a qualified opinion from our auditors.
In their audit report dated June 20, 2000 our auditors indicated that our
ability to realize value from our assets was dependent upon our meeting future
financing requirements and the success, if any, of our future operations.
We have not completed the development of our Web site and cannot assure that we
will be able to do so in the future.
Many proposed features of our OneDentist.com Web site are not yet
functional, including our Web-based application software, standardized dental
office procedure manuals and dental product purchase software. We also have not
yet launched our chat rooms and message boards. If we are unable to include
these and other proposed functions on our Web site, our competitive position
will be adversely affected, and our Web site traffic will be significantly
curtailed.
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If we are unable to develop strategic relationships for Web content, our Web
development time will be significantly extended, and our capital costs will be
significantly increased.
We intend to rely upon strategic partners to provide in-depth content and
resources to our Web site such as:
o Inventories of dental supplies;
o Educational programming;
o Financial, insurance and professional employer organization services;
o Marketing services and research; and
o Web-based application software.
If we are unable to enter into strategic relationships for the provision of
these and other content and resource assets, our Web site features and our Web
traffic will be greatly reduced, and our Web development time and capital costs
will be significantly increased.
We face intense competition which could reduce our revenue and earnings.
The on-line market for Internet users and advertisers which comprise Web
site communities is new and rapidly evolving, and competition for users and
advertisers is intense and is expected to increase significantly in the future.
Barriers to entry are not substantial. We believe that the principal competitive
factors for companies seeking to create these communities are critical mass,
functionality, brand recognition, member affinity and loyalty, broad demographic
focus and open access to visitors. Other companies who are primarily focused on
creating Web-based communities for healthcare on the Internet include WebMD,
which has registered the domain name WebDDS, and DR.Koop.com. Direct competitors
offering on-line dental services to dentists and patients include QSINet,
e-dental.com, dentistryon-line.com and r-dental.com. This competition could
reduce our revenue and earnings or otherwise adversely affect our operations.
Our operating results may fluctuate due to a variety of factors and are not a
meaningful indicator of future performance.
Our operating results may fluctuate significantly in the future depending
upon a variety of factors, including the incurrence of capital costs and the
introduction of new products and services. Additional factors that may
contribute to variability of our operating results include:
o The pricing and mix of services we offer on our Web site;
o Our member and customer retention rates; and
o Changes in pricing policies and product offerings by our competitors.
Our strategy of rapid growth will put a significant strain on our resources.
Our strategy of rapid growth will place a significant strain on our
managerial, operating, financial and other resources, including our ability to
ensure customer satisfaction. Our expansion efforts will also require
significant time commitments from our senior management and will place a strain
on their ability to manage our existing business. Our future performance will
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depend, in part, upon our ability to manage this growth effectively. To that
end, we will have to undertake the following improvements, among others.
o Implement additional management information systems capabilities;
o Further develop our operating, administrative and financial and
accounting systems and controls;
o Improve coordination between our engineering, accounting, finance,
marketing and operations personnel; and
o Hire and train additional management personnel and employees.
We depend on key personnel and could be affected by the loss of their services
because of the limited number of qualified people in our industry.
Competition for qualified employees in the Internet services industry is
intense and there are a limited number of people with knowledge of and
experience in the industry. The process of locating personnel with the skills
required to carry out our strategies may be lengthy and costly. We do not have
employment agreements with any of our executive officers nor do we carry key man
insurance on their lives. Our success depends to a significant degree upon our
ability to attract and retain qualified management, technical, marketing and
sales personnel and upon the continued contributions of such people. Our
employees may voluntarily terminate their employment with us at any time. We
cannot assure you that we will be successful in attracting and retaining
qualified executives and personnel. The loss of the services of key personnel,
or the inability to attract additional qualified personnel, could have a
material adverse effect on our business, operating results and financial
condition.
Rapid technological change could negatively affect our business.
Rapidly changing technology, evolving industry standards, evolving customer
demands and frequent new product and service introductions characterize the
market for Internet related companies including business-to-business and
business-to-consumer Web sites. Our future success will depend in significant
part on our ability to improve the performance, content and reliability of our
Web site in response to both the evolving demands of the market and competitive
product offerings. Our efforts in these areas may not be successful.
Future governmental regulation, privacy concerns and regulations affecting
dentists could increase our costs, decrease demand for our products or curtail
our operations.
We are not currently subject to direct regulation by any government agency,
other than regulations applicable to businesses generally, and there are
currently few laws or regulations directly applicable to access to or commerce
on the Internet. However, due to the increasing popularity and use of the
Internet, a number of legislative and regulatory proposals are under
consideration by federal, state, local and foreign governmental organizations,
and it is possible that a number of laws or regulations may be adopted with
respect to the Internet relating to issues such as user privacy, taxation,
infringement, pricing, quality of products and services and intellectual
property ownership. The adoption of any laws or regulations that have the effect
of imposing additional costs, liabilities or restrictions relating to the use of
the Internet by businesses or consumers could decrease the growth in the use of
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the Internet, which could in turn decrease the demand for our Internet access,
and e-commerce and direct marketing services, increase our cost of doing
business, or otherwise have a material adverse effect on our business. Moreover,
the applicability to the Internet of existing laws governing issues such as
property ownership, copyright, trademark, trade secret, obscenity, libel and
personal privacy is uncertain and developing. Any new legislation or regulation,
or application or interpretation of existing laws, could have a material adverse
effect on our business. Our operations may also be limited by dental rules,
regulations and codes of conduct applicable to dentists, to the extent that our
products, services or compensation arrangements are inconsistent with such
rules, regulations and codes.
Our business model is new, unproven and changing.
Our business model consists of providing dentists and patients with on-line
products and information related to dentistry. We have only recently applied our
business model to the Internet, it is unproven and will need to be further
developed. Accordingly, our business model may not be successful, and we may
need to change it. Our ability to generate sufficient revenue to achieve
profitability will depend, in large part, on our ability to successfully market
our site to dentists that may not be convinced of the need for an on-line
presence or may be reluctant to rely upon third parties to help develop and
manage their dental practices and procedures.
We launched our OneDentist.com Web site in February 2000. Therefore, you
should also consider our prospects in light of the risks and difficulties
frequently encountered by early stage companies in the rapidly evolving on-line
market. These risks include, but are not limited to, an unpredictable business
environment, the difficulty of managing growth and the successful application of
our business model. To address these risks, we must, among other things:
o Expand our base of on-line dentists;
o Enhance OneDentist.com brand recognition;
o Expand our product and service offerings;
o Successfully implement our business and marketing strategy;
o Provide superior Web design, Web hosting and order processing to our
dentists;
o Respond effectively to competitive and technological developments; and
o Attract and retain qualified personnel.
If we do not increase brand awareness, our sales may suffer.
Due in part to the emerging nature of the markets for business-to-business
and business-to- consumer Web sites and the substantial resources available to
many of our competitors, our opportunity to achieve and maintain a significant
market share may be limited. Developing and maintaining awareness of the
OneDentist.com brand is critical to achieving widespread acceptance of the site
as well as of our e-commerce and direct marketing solutions. The importance of
brand recognition will increase as competition in our market increases.
Successfully promoting and positioning the OneDentist.com brand will depend
largely on the effectiveness of our marketing efforts and our ability to develop
reliable and useful products and services to dentists at competitive prices. If
our planned marketing efforts are ineffective, we may need to increase our
financial commitment to creating and maintaining brand awareness among shoppers
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and merchants, which could divert financial and management resources from other
aspects of our business, or cause our operating expenses to increase
disproportionately to our revenues.
The security provided by our e-commerce services could be breached or our
network could fail.
A fundamental requirement for e-commerce is the secure transmission of
confidential information over the Internet. Third parties may attempt to breach
the security provided by our e- commerce services or the security of our
dentists' systems. If they are successful, they could obtain confidential
information about dentists and patients using our Web site, including their
passwords, financial account information, credit card numbers or other personal
information. We or our providers may be liable to our customers for any such
breach in security. Even if we are not held liable, a security breach could harm
our reputation, and the mere perception of security risks, whether or not valid,
could inhibit market acceptance of our services. We or our providers may be
required to expend significant capital and other resources to license additional
encryption or other technologies to protect against security breaches or to
alleviate problems caused by these breaches. In addition, our dentists might
decide to stop using our e-commerce services if their patients experience
security breaches.
Risks Related to the Offering.
Shares of our common stock which are eligible for sale by our stockholders may
decrease the price of our common stock.
Upon completion of the offering, we will have 6,000,000 shares outstanding,
including 2,316,250 shares which are freely tradeable and 3,683,750 shares which
are restricted shares but may be sold under Rule 144 commencing in June 2001. If
the holders sell substantial amounts of our common stock, then the market price
of our common stock could decrease.
There is no trading market for our common stock.
Our common stock is not eligible for trading on any stock exchange and
there can be no assurance that our common stock will achieve listing on any such
exchange. We have applied for listing on the Nasdaq Over-the-Counter Bulletin
Board Trading System pursuant to Rule 15c2-11 of the Securities Exchange Act of
1934, but there can be no assurance we will obtain such a listing. The Bulletin
Board tends to be highly illiquid, in part because there is no national
quotation system by which potential investors can track the market price of
shares except through information received or generated by a limited number of
broker-dealers that make a market in particular stocks. There is a greater
chance of market volatility for securities that trade on the Bulletin Board as
opposed to a national exchange or quotation system. This volatility may be
caused by a variety of factors, including:
o The lack of readily available price quotations;
o The absence of consistent administrative supervision of "bid" and
"ask" quotations;
o Lower trading volume; and
o Market conditions.
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In a volatile market, you may experience wide fluctuations in the market
price of our securities. These fluctuations may have an extremely negative
effect on the market price of our securities and may prevent you from obtaining
a market price equal to your purchase price when you attempt to sell our
securities in the open market. In these situations, you may be required to
either sell our securities at a market price which is lower than your purchase
price, or to hold our securities for a longer period of time than you planned.
Because our common stock is likely to be classified as "penny stock", trading
will be limited, and our stock price could decline.
Because our common stock is likely to fall under the definition of "penny
stock," trading in our common stock, if any, is expected to be limited because
broker-dealers are required to provide their customers with disclosure documents
prior to allowing them to participate in transactions involving our common
stock. These disclosure requirements are burdensome to broker-dealers and may
discourage them from allowing their customers to participate in transactions
involving our common stock.
"Penny stocks" are equity securities with a market price below $5.00 per
share other than a security that is registered on a national exchange; included
for quotation on the Nasdaq system; or whose issuer has net tangible assets of
more than $2,000,000 and has been in continuous operation for greater than three
years. Issuers who have been in operation for less than three years must have
net tangible assets of at least $5,000,000.
Rules promulgated by the Securities and Exchange Commission under Section
15(g) of the Exchange Act require broker-dealers engaging in transactions in
penny stocks, to first provide to their customers a series of disclosures and
documents, including:
o A standardized risk disclosure document identifying the risks inherent
in investment in penny stocks;
o All compensation received by the broker-dealer in connection with the
transaction;
o Current quotation prices and other relevant market data; and
o Monthly account statements reflecting the fair market value of the
securities. In addition, these rules require that a broker-dealer
obtain financial and other information from a customer, determine that
transactions in penny stocks are suitable for such customer and
deliver a written statement to such customer setting forth the basis
for this determination.
In addition, under the Exchange Act and its regulations, any person engaged
in a distribution of shares of our common stock offered by this prospectus may
not simultaneously engage in market making activities with respect to the common
stock during the applicable "cooling off" periods prior to the commencement of
this distribution.
Our preferred stock may make a third-party acquisition of our company more
difficult.
Our articles of incorporation authorize our Board of Directors to issue up
to 10,000,000 shares of preferred stock having such rights as may be designated
-13-
by our Board of Directors, without stockholder approval. This issuance of
preferred stock could inhibit a change in control by making it more difficult to
acquire the majority of our voting stock.
We do not anticipate paying dividends.
We have not paid any cash dividends on our common stock since our inception
and we do not anticipate paying cash dividends in the foreseeable future. Any
dividends which we may pay in the future will be at the discretion of our Board
of Directors and will depend on our future earnings, any applicable regulatory
considerations, our financial requirements and other similarly unpredictable
factors. For the foreseeable future, we anticipate that we will retain any
earnings which we may generate from our operations to finance and develop our
growth.
-14-
USE OF PROCEEDS
The net proceeds of the offering after payment of all expenses will be
$710,000 if the minimum 500,000 shares are sold, and $1,580,000 if all 1,000,000
shares are sold. We expect to use the net proceeds over a 12-month period,
approximately as follows:
Purpose Minimum Maximum
------- ------- -------
Marketing expenses $200,000 $ 500,000
Expansion of product offerings $100,000 $ 200,000
Purchase of equipment $ 50,000 $ 150,000
General and administrative expenses $300,000 $ 500,000
Working capital $ 60,000 $ 230,000
-------- ----------
TOTALS $710,000 $1,580,000
======== ==========
There may be changes in our proposed use of proceeds due to changes in our
business or the Internet industry in general. Proceeds not immediately needed
will be invested in bank certificates of deposit, treasury bills, insured bank
deposits or similar investments.
We will not receive any proceeds from the sale of shares of our common
stock being offered by the selling stockholders.
-15-
DILUTION
At April 30, 2000, the net tangible book value of our outstanding shares of
common stock was $186,944 or $.04 per share. "Net tangible book value" per share
represents the total amount of our tangible assets, less the total amount of our
liabilities, divided by the number of shares of common stock outstanding.
Without taking into account any changes in net tangible book value after April
30, 2000, other than to give effect to the sale of all 1,000,000 shares of
common stock offered at the public offering price of $2.00 per share, less
underwriting discounts and commissions and estimated costs of the offering, our
net tangible book value at April 30, 2000, would have been $1,793,610 or
approximately $.30 per share. This represents an immediate increase in net
tangible book value of $.26 per share of common stock to our existing
stockholders, and an immediate dilution of $1.70 per share to new investors.
"Dilution" per share represents the difference between the price to be paid
by the new stockholders and the net tangible book value per share of common
stock immediately after this offering. The following table illustrates this per
share dilution.
Initial public offering price per share: $2.00
Net tangible book value per share before the offering: $.04
Increase in net tangible book value per share
attributable to new investors purchasing in the offering: $.26
Net tangible book value per share after the offering: $ .30
Dilution per share to new investors: $1.70
Dilution as a percentage of the per share purchase price: 85%
The following table sets forth the number of shares of common stock
purchased, assuming all 1,000,000 shares are sold, the total consideration paid,
before the deduction of offering expenses and underwriting discounts, and the
average price per share paid by our existing stockholders as of April 30, 2000,
and new investors purchasing the shares of common stock offered:
Shares Purchased Total Consideration
---------------- ------------------- Average Price
Number Percentage Amount Percentage Per Share
------ ---------- ------ ---------- ---------
New investors 1,000,000 16.7% $ 2,000,000 86.4% $ 2.00
Existing stockholders 5,000,000 83.3% $ 314,752 13.6% $ .06
--------- ------ ------------ ------
Totals: 6,000,000 100.0% $ 2,314,752 100.0%
------- ========= ====== ============ ======
-16-
CAPITALIZATION
The following table sets forth our historical and as adjusted
capitalization as of April 30, 2000, after deducting underwriting discounts and
commissions and estimated offering expenses. As adjusted capitalization reflects
the sale of the 1,000,000 shares of common stock offered by us hereby at an
assumed offering price of $2.00 per share and the application of the net
proceeds.
April 30, 2000 April 30, 2000
Actual: As Adjusted:
-------------- -------------
Long-term liabilities $ 0 $ 0
Preferred stock, no par value,
10,000,000 shares authorized,
no shares issued $ 0 $ 0
Common stock, no par value, 25,000,000
shares authorized, 5,000,000 shares
outstanding, 6,000,000 shares
outstanding as adjusted $ 284,752 $ 1,864,752
Accumulated deficit $ (71,142) $ (71,142)
---------- ----------
Total stockholders' equity $ 213,610 $ 1,793,610
---------- ------------
Total capitalization: $ 213,610 $ 1,793,610
========== ============
-17-
SELECTED FINANCIAL DATA
The selected financial data set forth below should be read in conjunction
with "Management's Discussion and Analysis of Financial Condition and Resulting
Operations" included elsewhere in this prospectus. The operating data for the
four months ended April 30, 2000 and for the period from July 16, 1999 (date of
inception) through December 31, 1999 is derived from the proforma financial
statements which give effect to the merger of Haleakala Enterprises, Inc. and
OneDentist Resources, Inc. (fka OneDentist.com, Inc.). The proforma financial
statements as of April 30, 2000 and for the four months then ended ans as of
December 31, 1999 and for the period July 16, 1999 (date of inception) through
December 31, 1999 were prepared utilizing the financial statements of OneDentist
Resources, Inc which have been audited by Hausser + Taylor LLP, independent
accountants, and are included in this prospectus, and the unaudited financial
statements of Haleakala Enterprises, Inc. which are included in this prospectus.
The unaudited financial statements have been prepared on substantially the same
basis as the audited financial statements and, in the opinion of management,
include all adjustments, consisting only of normal recurring adjustments,
necessary for the fair presentation of the results of operations for these
periods. Historical results are not necessarily indicative of the results to be
expected in the future, and the results of interim periods are not necessarily
indicative of results for the entire year.
Operating data:
Period from July 16,
1999 (date of
inception) through Four months
December 31, 1999 ended April 30, 2000
-------------------- --------------------
Costs and expenses:
Legal, consulting and accounting $ 4,401 $ 43,570
Compensation and related expenses -- 7,802
Occupancy expenses -- 6,871
Other operating expenses -- 9,198
----------- -----------
Total costs and expenses 4,401 67,441
----------- -----------
Operating loss (4,401) (67,441)
----------- -----------
Interest income -- 700
----------- -----------
Net loss $ (4,401) $ (66,741)
=========== ===========
Net loss per share $ .001 $ (0.013)
=========== ===========
Weighted average number of shares
of common stock outstanding 5,000,000 5,000,000
=========== ===========
Balance Sheet data:
As of As of
December 31, 1999 April 30, 2000
----------------- --------------
Cash and cash equivalents $ -- $ 259,749
Total assets -- 286,415
Total liabilities 2,149 72,805
Common stock 2,252 284,752
Accumulated deficit (4,401) (71,142)
Stockholders' equity (2,149) 213,610
-18-
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following contains forward-looking statements that involve risks and
uncertainties. Our actual results could differ materially from those anticipated
in these forward-looking statements as a result of certain factors, including
those set forth under "Risk Factors" and elsewhere in this prospectus. This
discussion should be read in conjunction with our audited financial statements
and footnotes included elsewhere in this prospectus.
Results of Operations.
Period from inception, July 16, 1999, to April 30, 2000.
We commenced operations on July 16, 1999. From July 16, 1999 through April
30, 2000, we incurred a net loss of $71,142, or $.01 per share, and did not
generate any operating revenue.
The majority of the expenses we incurred prior to December 31, 1999 related
to organizational matters in connection with our merger, and the majority of
expenses from January 1, 2000 to April 30, 2000 related to the development of
our Web site, subscriber base, content and establishment of our administrative
offices. All expenses have been paid in cash rather than in our securities.
Liquidity and Capital Resources.
To date we have not generated positive cash flow from operations due to
development and infrastructure costs to support expected growth. In March 2000
we completed a $312,500 private placement of our securities to fund our cash
requirements. We intend to continue to fund the development of our
OneDentist.com Web site.
We expect to need additional funds to add features to our OneDentist.com
Web site. We intend to seek additional funding through this offering. However,
there can be no assurance that new capital will be available to us or that
adequate funds for our operations, whether from debt or equity financings, will
be available when needed or on terms satisfactory to us. Our failure to obtain
adequate additional financing may require us to delay or curtail some or all of
our programs, sales and marketing efforts, or other operations. Any additional
equity financing may involve substantial dilution to our then-existing
stockholders.
-19-
BUSINESS
The Dental Industry Challenge.
According to the American Dental Association, in 1999 dental practice
income exceeded $50 billion and dental practices employed 400,000 people in
125,000 dental offices across the United States. Over 72% of these dental
offices were operated by a single practitioner who did not have access to the
marketing and administrative support available to larger dental offices. While
dental practitioner income is increasing regularly due to the aging of the U.S.
population, older Americans are in need of increasingly more complex dental
treatments. Accordingly, dentists face the increased challenges of requiring
more sophisticated expertise and more technologically advanced equipment while
controlling their operating margins, managing the business side of their dental
practice and learning new and improved dental practices and procedures.
There are few cost-effective resources available to single-practitioner
dental practices. In addition to spiraling equipment and supply costs, most
information technology-based dental solutions and systems require investments
beyond the resources of small dental practices. This problem is further
aggravated by the fact that most dental offices have staff with little or no
professional business training.
OneDentist.com.
We have designed OneDentist.com, a Web site which we launched in February
2000, to provide innovative business-to-business features for dentists, and
interactive business-to-consumer resources for dental patients. We distinguish
ourselves from other Web-based dental sites by designing and hosting for our
dentists individual, interactive Web sites. These Web sites allow our dentists
to communicate with and market to their patients and to provide their patients
with content and information tailored specifically to each dentist's practice.
In doing so, we offer each dentist the opportunity to develop and maintain his
or her own brand identity with respect to communication with patients and
vendors.
We offer dentists integrated back-office tools and systems and intend
to provide these resources on a secure, easy-to-implement browser-based Web
platform in order to reduce dental office administrative burdens. Our
OneDentist.com Web site also offers dentists marketing assistance through
on-line patient referrals and appointment reminders designed to improve the
relationship and bond between dentist and patient. The OneDentist.com Web site
provides standardized dental office procedures and forms while allowing dentists
to purchase dental supplies currently by e-mail and soon on-line. In order to
support the need for continuing dental education, we intend to offer on-line
continuing dental education programs, dental news, marketing research and
statistical profiles of other dental practices, as well as classified dental
advertisements.
In the future, we intend to provide Web-based application software which
will provide billing, scheduling, insurance and managed care benefits to our
dentists. We are also negotiating strategic relationships which we believe will
allow us to provide financial, insurance and professional employer organization
services to our dentists.
-20-
In order to attract dental patients, our OneDentist.com Web site offers
consumers a dentist- finder search engine, which enables consumers to locate and
compare dentists by geographical location and offers in-depth information on
dental practices, including map-finding, areas of specialty, insurance
information and backgrounds on dental practitioners. In order to attract
consumers to our Web site, we also offer free dental education information such
as dental health news and articles on dental treatments. We offer patients the
convenience of interactive communication with their dentists through e-mail,
which allows for scheduling of appointments, billing inquiries and the exchange
of insurance information. We also offer dental products for sale to consumers
and in the future intend to promote the stickiness of our Web site by offering
dental-related chat rooms and message boards.
Sources of Revenue.
We will charge fees to our dental practitioners for designing, developing
and hosting their Web sites, along with a monthly membership fee.
In the future, we intend to earn additional revenue through:
o The sale of dental products to dentists and patients;
o The sale of on-line continuing dental education products such as
classes and seminars in dental practices;
o Patient referral fees, appointment confirmations and satisfaction
inquiries charged to dentists;
o Fees and commissions earned under strategic arrangements with
providers of financial, insurance, professional employer organization
and related services;
o E-commerce transaction fees charged for sales made by our dental and
non-dental suppliers and vendors;
o In-practice consultation fees charged directly to dental offices; and
o The sale of advertising and marketing messages targeted to specific
demographic groups among our dentists and users.
Strategy.
Our goal is for OneDentist.com to become a leading Web destination for both
dental professionals and dental patients by providing an interactive Web site
tailored to the specific needs of each practitioner. In order to achieve our
goal, we intend to:
o Increase the number of dental practitioners using our Web site by:
Continuing to Develop Strategic Relationships. We intend to continue to
develop strategic relationships with dental practice associations, insurance
providers, billing services and practice- management groups. We will also offer
tailored services and group discount rates to members of these strategic groups
in order to obtain sponsorship and referrals from such groups. Consistent with
this approach, we have entered into an agreement with Oxyfresh Worldwide, a
network which includes approximately 10,000 dentists that distributes
proprietary oral and other healthcare products through dental practitioners who
act as distributors of the Oxyfresh dental product lines. Under the terms of our
agreement with Oxyfresh, we provide free Web site design, e-mail, and Web
-21-
hosting for Oxyfresh dentists who become members of the OneDentist.com program.
In turn, Oxyfresh recommends our Web site to its dentist members, provides our
promotional materials to be included in mailings made by Oxyfresh to its dentist
members and generally recommends the use of our OneDentist.com Web site to its
membership. Our agreement with Oxyfresh may be canceled by either party at any
time.
Entering Into Vendor Arrangements. We intend to negotiate supplier and
vendor agreements covering a broad range of products and services. Our goal is
to allow our dental practitioners to use our Web site as a one-stop shopping
source for dental as well as non-dental products and services. We expect that
our on-line suppliers and vendors will be national, regional and local firms who
will be motivated to enter into strategic arrangements with us in order to
access our dental practice database while reducing their transaction costs and
improving their marketing efficiencies.
Offering Innovative Web-Based Back-Office Management Software. We intend to
become a Web-based application service provider, generally referred to as an
"ASP", offering a complete line of management software for dental practitioners.
Under our "digital dashboard" trade name, we will offer a wide variety of office
management software tools which will include extensive collections of integrated
back-office software, including billing, scheduling, insurance, managed-care
benefits and other related back-office practice methods. The digital dashboard
will also become a source of news and trends within the dental industry, and
allow for the exchange of information, similar to an intranet, between dental
practitioners through e-mail and real-time chats.
Developing Direct Marketing Programs to Attract Small- to Medium-Size
Dental Practices. In addition to marketing through trade groups and associations
such as Oxyfresh, we intend to market directly to smaller dental practices. Due
to the extreme fragmentation of the dental industry, we will seek to enroll
dentists by initially concentrating on the top 100 dental markets. Our marketing
will include conducting dental education seminars, and the use of on-line and
traditional advertising media.
Sponsoring Dental Trade Meetings, Promotional Events and Mentoring
Programs. We intend to sponsor a number of events attended by dental
professionals in order to further expose our brand. These events will include
dental trade meetings and promotional events which are attended by dentists and
dental product vendors as well as mentoring programs and related continuing
dental education seminars and conferences.
Offering Value-Priced Dental Products for the Practitioner. Through our
anticipated national vendor relationships we expect to provide our dentists with
dental products at significant discounts to their current supplier prices. In
the future we also expect to provide our dentists with access to more
information about suppliers and their products, as well as access to product
supply auctions held by larger vendors.
o Increase the number of dental patients using our OneDentist.com Web
site by:
Offering a User-Friendly Guide to Selecting Dentists in the User's
Location. OneDentist.com provides dental consumers with a search engine that
allows them to locate and compare our dentist members by geographical location.
-22-
Once a potential dental practice is selected, the site offers the consumer
in-depth information on the dental practice including map-finding assistance,
areas of specialty, insurance information and backgrounds on the practitioners.
Providing Interesting and Informative News and Articles on Dental Subjects.
We intend to enter into strategic relationships with industry partners in order
to provide contemporary dental information and interesting dental content on a
wide variety of dental subjects, including information on dental cosmetic
procedures and new dental technological developments.
Promoting the OneDentist.com Brand Name Through Web-Based and Traditional
Media Advertising. We intend to use Web-based and traditional media to promote
our brand directly to consumers. We believe that by increasing our consumer base
we will attract additional dentist members, as well as advertisers and suppliers
whose products and services are directed to the dental consumer.
Developing Multi-Lingual Versions of Our Web Site. We intend to outsource
the development of foreign language features for at least a portion of the
OneDentist.com Web site, in order to attract non-English speaking users.
o Further expand the functionality of our dentists' Web sites:
We intend to further expand the functionality of our dentists' Web sites to
provide substantially all of the content that will be available on our own
OneDentist.com Web site. Accordingly, patients will find a content-rich and
robust home page provided by their own dentist, thereby assisting the dentist in
establishing his or her own brand, improving the relationship between the
dentist and patient and allowing the patient to use the Web site as a portal for
all dental needs.
o Generate additional revenue through the on-line sale of dental products,
advertising, e-commerce transaction fees and consultation services:
In addition to the on-line sale of dental products and advertising, we
believe we can generate additional revenue through e-commerce transaction fees
and various consultation services. These services would include out-source
activities such as patient appointment confirmation, fulfillment center services
such as delivery of sample products, follow-up patient satisfaction inquiries
and the like.
Marketing.
We intend to market OneDentist.com memberships to dentists through dental
practice associations such as Oxyfresh, insurance providers, dental product
supply companies, billing services and practice-management groups. To support
this effort, we intend to offer discounted Web services to members of these
strategic groups. We will also market directly to small- and medium-size dental
practices through on-line and traditional media advertising such as banner ads,
targeted e-mail, direct mail, telemarketing and magazine advertisements. At the
same time, we will seek to establish our brand with dental consumers through
advertisements in national, regional and local magazines, as well as through
on-line banner advertisements.
-23-
We will also conduct educational seminars aimed at dentists, co-sponsored
by advertising partners or vendors, relating to ongoing dental education as well
as dental topics of current interest to dentists.
Competition.
The on-line market for industry specific businesses, users and advertisers
is new and rapidly evolving, and competition for users and advertisers is
intense and is expected to increase significantly in the future. Barriers to
entry are relatively insubstantial. We believe that the principal competitive
factors for companies seeking to create these industry specific communities are
critical mass, functionality, brand recognition, member affinity and loyalty,
broad demographic focus and open access to visitors.
A number of other companies have created Web-based communities for
healthcare on the Internet including WebMD and DR.Koop.com. More specifically, a
number of direct competitors offer on-line dental services to dentists and
patients including QSINet, e-dental.com, dentistryon- line.com and r-dental.com.
Most of these competitors offer Web sites focused on dentist referrals and
dental information or news, while we emphasize the development of individual Web
sites for dentists which allow for interactive communication with dental
consumers and the delivery of marketing messages and in depth dental information
to users. This competition could reduce our revenue or earnings or otherwise
adversely affect our operations.
We may also face competition in the future from Web directories, search
engines, software archives, content sites, commercial on-line services, sites
maintained by Internet service providers or ISPs, and other entities that
establish dental communities on the Internet by developing their own Web sites
or purchasing one of our competitors. In addition, we could face competition in
the future from traditional media companies, a number of which have recently
made significant acquisitions of or investments in Internet companies. There can
be no assurance that our competitors and potential competitors will not develop
communities that are equal or superior to or that achieve greater market
acceptance than ours.
We also compete with traditional forms of media such as newspapers,
magazines, radio and television, for advertisers and advertising revenue. We
believe that the principal competitive factors in attracting advertisers include
the amount of traffic on the Web site, brand recognition, customer service, and
the demographics of our members and viewers. We believe that the number of
Internet companies relying on Web-based advertising revenue will increase in the
future. Accordingly, we will likely face increased competition resulting in
increased pricing pressures on our advertising rates which could in turn have a
material adverse effect on our business, results of operations and financial
condition.
Virtually all of our existing and potential competitors, including Web
directories and search engines and large traditional media companies, have
longer operating histories in the Web market, greater name recognition, larger
customer bases and significantly greater financial, technical and marketing
resources than we do. These competitors are able to undertake more extensive
marketing campaigns for their brands and services, adopt more aggressive
advertising pricing policies and make more attractive offers to potential
employees, distribution partners, commerce companies, advertisers and
-24-
third-party content providers. There can be no assurance that Internet content
providers and ISPs, including Web directories, search engines, shareware
archives, sites that offer professional editorial content, commercial on-line
services and sites maintained by ISPs, will not be perceived by advertisers as
having more desirable Web sites for placement of advertisements.
Many of our potential advertising customers and strategic partners have
established collaborative relationships with competitors or potential
competitors, and other high-traffic Web sites. Accordingly, there can be no
assurance that we will be able to develop and increase our membership, traffic
levels and advertiser customer-base. There can also be no assurance that we will
be able to compete successfully against our current or future competitors or
that competitors will not have a material adverse effect on our business,
results of operation and financial condition.
Intellectual Property.
We regard our technology as proprietary and intend to restrict use by
others by seeking trademark, service mark, copyright and trade-secret
protection. We currently have no patents or patents pending and do not
anticipate that patents will become a significant part of our intellectual
property in the foreseeable future. We generally enter into confidentiality
agreements with our employees and consultants, and generally control access to
and distribution of our documentation and other proprietary information. Despite
these precautions, it may be possible for a third party to copy or otherwise
obtain and use our proprietary information without authorization, or to develop
similar technology independently. We have registered the domain names
"onedentist.com" and "1dentist.com" and intend to pursue the registration of our
service marks in the United States and internationally. We have applied for the
registration in the United States for the service mark "OneDentist." Effective
trademark, service mark, copyright and trade-secret protection may not be
available in every country in which our services are distributed or made
available through the Internet, and policing unauthorized use of our proprietary
information will be difficult.
Legal standards relating to the validity, enforceability and scope of
protection of certain proprietary rights in Internet-related businesses are
uncertain and still evolving; no assurance can be given as to the future
viability or value of any proprietary rights of ours or other companies within
our market. There can be no assurance that steps taken by us will prevent
misappropriation or infringement of our proprietary information. Any such
infringement or misappropriation, should they occur, might have a material
adverse effect on our business, results of operations and financial condition.
In addition, litigation may be necessary in the future to enforce our
intellectual property rights, to protect our trade secrets, or to determine the
validity and scope of the proprietary rights of others. Such litigation might
result in substantial costs and diversion of resources and management attention,
and could have a material adverse effect on our business, results of operations,
and financial condition. Furthermore, there can be no assurance that our
business activities will not infringe upon the proprietary rights of others, or
that other parties will not assert infringement claims against us.
Employees.
As of April 30, 2000, we had three full-time employees and four part-time
employees, including our executive officers.
-25-
Facilities.
We currently lease 1,500 square feet of office space on a month-to-month
basis in Columbus, Ohio, for $1,545 per month.
-26-
MANAGEMENT
Directors and Executive Officers.
The following table sets forth information regarding our executive officers
and directors, all of whom joined us in 1999:
Officer or
Name Age Office Director Since
---- --- ------ --------------
Richard J. Horn 47 Chairman of the Board and July 1999
Chief Executive Officer
Graydon D. Webb 52 President, Chief Operating Officer, July 1999
Treasurer and Director
Gerald S. Strauss 53 Secretary and Director July 1999
Louis P. DiOrio 68 Director of Education Content July 1999
Joel M. McCuen 53 Vice President - Business Services July 1999
Phillip A. Knall 51 Vice President - Sales July 1999
Directors hold office for a period of one year from their election at the
annual meeting of stockholders and until their successors are duly elected and
qualified. Officers are elected by, and serve at the discretion of, the Board of
Directors. None of the above individuals has any family relationship with any
other. Our audit committee is composed of: Messrs. Horn, Webb and Strauss.
Directors do not receive payment for attending Board meetings, but are
reimbursed for out-of- pocket expenses.
The following is a summary of the business experience of each of our
executive officers and directors:
Richard J. Horn, is a graduate of Miami University of Ohio. In 1999 he
co-founded Horn Interactive, Inc., a Web development company specializing in
tools and content for corporate Intranets. From 1982 to 1999, he served as Chief
Executive Officer of Comware Incorporated, a developer of on-line training
programs for Fortune 500 corporations. He has won numerous national and
international awards for his work in on-line learning, work tools and content.
Mr. Horn devotes approximately 30 hours per week to our affairs and provides Web
development and content management assistance through Horn Interactive.
Graydon D. Webb, is a graduate of The Ohio State University and
participated in its Executive MBA Program. Mr. Webb served as Vice President of
Franchise Sales for Wendy's from 1973-1980. He founded G.D. Ritzy's, Inc., a
fast-food franchiser, in 1980 and served as its Chairman through 1988. In 1988,
he co-founded TouchChoice Systems, an interactive communications company, and
-27-
served as an executive officer and director until 1991. From 1991 to 1998, he
was founder and sole proprietor of Auric Group, a consulting group specializing
in restaurant and general franchising activities. Auric's clients included
PepsiCo, Bunge Foods International and Rally's. Since 1996, he has been Managing
Director of Chapman Partners, LLC, a company engaged in mergers and acquisitions
for food-related companies.
Gerald S. Strauss, is a graduate of The Ohio State University College of
Dentistry and has been practicing general family dentistry in Marysville, Ohio,
since 1973. During this time he also served as a Clinical Instructor at The Ohio
State University College of Dentistry. He is an expert in dental practice
valuation and enhancement. Dr. Strauss devotes approximately 30% of his time to
our affairs.
Louis P. DiOrio, MA, DDS, is a Professor Emeritus at The Ohio State
University, having served on the dental faculty since 1974. He was an Associate
Professor and Chair of Community Dentistry at the University of Texas Dental
Branch at Houston from 1968 to 1973 and is an authority on dental practice
enhancement and dental course design. He has authored several books, articles
and manuals dealing with dental education. Dr. DiOrio devotes approximately 40%
of his time to our affairs.
Joel M. McCuen, D.D.S., is a graduate of The Ohio State University College
of Dentistry. Since 1971, Dr. McCuen has served on its faculty and currently
teaches practice management and clinical operations. Dr. McCuen chairs the
Commission on Dental Testing in Ohio and frequently provides expert witness
testimony in dental ethics and dental procedure litigation. He devotes
approximately 30% of his time to our affairs.
Phillip A. Knall, D.D.S., is a graduate of The Ohio State University
College of Dentistry, and has been a practicing dentist since 1974. He is also a
dental consultant presenting seminars on the application of technology and
advanced practice management to dental groups throughout the United Sates. Dr.
Knall devotes approximately 30% of his time to our affairs.
Executive Compensation.
None of our executive officers have received or currently receive
compensation in excess of $100,000 per year. Mr. Webb, our President, does not
currently receive a salary or other compensation from us.
Although we have developed a stock option plan, none of our executive
officers or directors have been granted stock options, warrants or similar
securities.
Stock Option Plan.
In July 2000, our board of directors adopted, subject to stockholder
approval, our 2000 Stock Option Plan, which provides for the grant to employees,
officers, directors and consultants of options to purchase up to an aggregate of
500,000 shares of common stock, consisting of both "incentive stock options"
within the meaning of Section 422A of the United States Internal Revenue Code of
1986 (the "Code") and "non-qualified" options. Incentive stock options are
-28-
issuable only to employees, while non-qualified options may be issued to
non-employee directors, consultants and others, as well as to employees.
The Plan will be administered by our board of directors, which will
determine those individuals who are to receive options, the time period during
which the options may be partially or fully exercised, the number of shares of
common stock that may be purchased under each option, and the option price.
The per share exercise price of the common stock subject to an incentive
stock option or nonqualified option may not be less than the fair market value
of the common stock on the date the option is granted. The per share exercise
price of the common stock subject to a non-qualified option will be established
by the board of directors. The aggregate fair market value, determined as of the
date the option is granted, of the common stock that any employee may purchase
in any calendar year pursuant to the exercise of incentive stock options may not
exceed $100,000. No person who owns, directly or indirectly, at the time of the
granting of an incentive stock option to him, more than 10% of the total
combined voting power of all classes of our stock is eligible to receive any
incentive stock options under the Plan unless the option price is at least 110%
of the fair market value of the common stock subject to the option, determined
on the date of grant. Non- qualified options are not subject to this limitation.
No incentive stock option may be transferred by an optionee other than by
will or the laws of descent and distribution, and during the lifetime of an
optionee, the option will be exercisable only by him or her. In the event of
termination of employment other than by death or disability, the optionee has
three months after such termination during which he or she can exercise the
option. Upon termination of employment of an optionee by reason of death or
permanent total disability, his or her option remains exercisable for one year
thereafter to the extent it was exercisable on the date of such termination. No
similar limitation applies to non-qualified options.
Options under the Plan must be granted within ten years from the effective
date as amended of the Plan. The incentive stock options granted under the Plan
cannot be exercised more than ten years from the date of grant except that
incentive stock options issued to 10% or greater stock- holders are limited to
five year terms. All options granted under the Plan will provide for the payment
of the exercise price in cash or by delivery to us of shares of common stock
already owned by the optionee having a fair market value equal to the exercise
price of the options being exercised, or by a combination of such methods of
payment. Therefore, an optionee may be able to tender shares of common stock to
purchase additional shares of common stock and may theoretically exercise all of
his stock options with no additional investment other than his original shares.
Any unexercised options that expire or that terminate upon an optionee
ceasing to be an officer, director or an employee becomes available once again
for issuance. As of July 30, 2000, no options had been granted under the Plan.
Liability and Indemnification of Officers and Directors.
Our Articles of Incorporation provides that our directors will not be
liable for monetary damages for breach of their fiduciary duty as directors,
other than the liability of a director for:
-29-
o A breach of the director's duty of loyalty to our company or our
stockholders;
o Acts or omissions by the director not in good faith or which involve
intentional misconduct or a knowing violation of law;
o Willful or negligent declaration of an unlawful dividend, stock
purchase or redemption; or
o Transactions from which the director derived an improper personal
benefit.
Our Articles of Incorporation require us to indemnify all persons whom we
may indemnify pursuant to Colorado law to the full extent permitted by Colorado
law.
In addition, our bylaws require us to indemnify our officers and directors
and other persons against expenses, judgments, fines and amounts incurred or
paid in settlement in connection with civil or criminal claims, actions, suits
or proceedings against such persons by reason of serving or having served as
officers, directors, or in other capacities, if such person acted in good faith
and in a manner such person reasonably believed to be in or not opposed to our
best interests and, in a criminal action or proceeding, if he had no reasonable
cause to believe that his/her conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction or upon a
plea of no contest or its equivalent shall not, of itself, create a presumption
that the person did not act in good faith and in a manner which he or she
reasonably believed to be in or not opposed to our best interests or that he or
she had reasonable cause to believe his or her conduct was unlawful.
Indemnification as provided in our bylaws shall be made only as authorized in a
specific case and upon a determination that the person met the applicable
standards of conduct. Insofar as the limitation of, or indemnification for,
liabilities arising under the Securities Act of 1933 may be permitted to
directors, officers, or persons controlling us pursuant to the foregoing, or
otherwise, we have been advised that, in the opinion of the Securities and
Exchange Commission, such limitation or indemnification is against public policy
as expressed in the Securities Act of 1933 and is therefore, unenforceable.
-30-
SECURITY OWNERSHIP OF EXECUTIVE OFFICERS, DIRECTORS AND
BENEFICIAL OWNERS OF GREATER THAN 5% OF OUR COMMON STOCK
The following table sets forth information with respect to the beneficial
ownership of our common stock owned, as of July 31, 2000, by:
o The holders of more than 5% of our common stock;
o Each of our directors; and
o All of our directors and executive officers as a group.
Each stockholder's address is in care of our company at 5300 McKitrick
Boulevard, Columbus, Ohio 43235.
Number of Percent of Common Percent of Common
Shares of Common Stock Owned Stock Owned
Name of Beneficial Owner Stock Owned Prior To Offering After Offering
- ------------------------ ---------------- ------------------ ------------------
Richard J. Horn 863,121 17.3% 14.4%
Graydon D. Webb 436,953 8.7% 7.3%
Gerald S. Strauss 495,709 9.9% 8.3%
Andrew L. Horn 602,809 12.1% 10.1%
Edward Kelley 393,443 7.9% 6.6%
Joel M. McCuen 495,709 9.9% 8.3%
Louis P. DiOrio 313,490 6.3% 5.2%
All officers and directors
as a group (six persons) 2,663,738 53.3% 44.4%
-31-
SELLING STOCKHOLDERS
The following table sets forth the names of the selling stockholders and
the number of shares of our common stock beneficially owned by the selling
stockholders as of April 30, 2000. Each selling stockholder is offering all
shares owned by him or her. The table includes 221 selling stockholders who
acquired their shares in a private placement of our common stock under the
provisions of Rule 50b of Regulation D enacted under the Securities Act of 1933,
in February 1997.
The following shares may be offered from time to time by the selling
stockholders named below. The selling stockholders may not offer their shares
for sale until we close our offering of up to 1,000,000 shares and our common
stock is listed for trading on the Bulletin Board or the Pink Sheets. However,
the selling stockholders are under no obligation to sell all or any portion of
these shares of our common stock. In addition, the selling stockholders are not
obligated to sell such shares of our common stock immediately under this
prospectus. Since the selling stockholders may sell all or part of the shares of
common stock offered in this prospectus, we cannot estimate the number of shares
of our common stock that will be held by the selling stockholders upon
termination of this offering.
Other that Mr. Kelley, none of the selling stockholders are officers,
directors or principal stockholders of our company, and none own 5% or more of
our outstanding common stock. The address of each selling stockholder is in care
of our company at 5300 McKitrick Boulevard, Columbus, Ohio 43235.
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Helene Abrahams 375 *
Marshall Abrahams 375 *
Gary A. Agron 112,312 2.3%
William C. Anderson 85,000 1.7%
Elaine Asarch 375 *
Richard Asarch 375 *
Asian Pacific Industries Ltd. 375 *
Brenda S. Bagg 375 *
Gerald A. Bagg 375 *
Douglas C. Ball 375 *
-32-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Milton H. Barbarosh 375 *
Ricki Barbarosh 375 *
James D. Beatty 375 *
Susan Elliot Beatty 375 *
Carylyn K. Bell 375 *
J. Daniel Bell 375 *
Gerald M. Berenstein 375 *
Kathy Berenstein 375 *
Andrew N. Bernstein 375 *
Barbara V. Bernstein 375 *
Mitchell H. Bernstein 375 *
Angela Bortoluzzi 375 *
Eugene Bortoluzzi 375 *
Bruce W. Breitweiser 375 *
Jeannie W. Breitweiser 375 *
Arna K. Campbell 375 *
Roger R. Campbell 375 *
Capital General Corporation
Limited 375 *
Robert Carrier 375 *
Ben Casale 375 *
Christina Casale 375 *
John E. Cathcart 375 *
Jack H. Chabot 21,250 *
Ki Wai Chan 375 *
Ting Sun Chang 375 *
Barbara F. Chapman 375 *
-33-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Jay H. Chapman 375 *
Jiansi Chen 375 *
Andrew Chu 375 *
Kwok Fu Chu 375 *
Yin Kam Chu 375 *
Naomi R. Cohn 375 *
Rennei K. Coleman 375 *
Robert J. Coleman 375 *
David L. Cove 375 *
Garth G. Cox 21,250 *
Gerald Crouch 42,500 *
Keith A. Darling 21,250 *
Jack R. Daugherty 375 *
Shelley F. Daugherty 375 *
Joseph F. Demeo 375 *
Mary Jean Demeo 375 *
Tim DeRosa 21,250 *
Ernest DuFresne 375 *
Elliot Living Trust 375 *
Joanne Ernsten 375 *
Heather Evans 375 *
Joseph Fazzone 112,500 2.3%
H. Thomas Fehn 375 *
Monica R. Fehn 375 *
John E. Fitzpatrick 375 *
-34-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Suzanne Fitzpatrick 375 *
Five Oaks Investment Corp. 375 *
Wayne Fletcher 375 *
Carolyn Fong 375 *
Henry Fong 375 *
Chris Freeman 375 *
Maria Freeman 375 *
Jeffrey Frieldand 375 *
GM/CM Family Partners, Ltd. 112,312 2.3%
Penelope S. Gallagher 350 *
William J. Gallagher 112,688 2.3%
Anthony P. Gargiulo 375 *
Marcia A. Gargiulo 375 *
Judith H. Geller 375 *
Richard A. Geller 375 *
Bruce Gillman 42,500 *
Kimberly K. Gollehon 375 *
Ronald D. Gollehon 375 *
Zachary T. Gordon 375 *
Caryljo M. Greenblatt 375 *
Phill D. Greenblatt 375 *
Ian Gunn 375 *
Michele Gunn 375 *
Gary Gutterman 375 *
-35-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Sheila M. Gutterman 375 *
Harris Trust Dtd 8/22/94
Robert Allen Strahl Trustee 375 *
Deborah Hattoy-Londelius 375 *
John Hickey 375 *
Marsha Hillhouse 375 *
Matthew Hillhouse 375 *
Anne Marie Janssens-Lens 375 *
Paul F. Janssens-Lens 375 *
John Epert Family Trust 375 *
Leys Johnston-Koyle 375 *
Bernard F. Jones 21,250 *
Jeffrey E. Kahler 375 *
Joshua S. Kanter 375 *
Linda B. Kaufmann 375 *
Thomas A. Kaufmann 375 *
Brian Kelley 375 *
Edward Kelley 35,000 *
Jack D. Kelley 375 *
Jane A. Kelley 375 *
Teresa M. Kelley 375 *
George L. Kentris 42,500 *
Colleen A. Keogh 375 *
Gary E. Keogh 375 *
Mary Kilgore 375 *
Raymond Kilgore 375 *
-36-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Cynthia Kirby 375 *
Gerald Kirby 375 *
Lisa A. Kirby 375 *
Michael Kirby 375 *
Michael Kleinman 375 *
Michael J. Kourie 42,500 *
W. Koyle 375 *
Janet A. Kritzer 375 *
Stuart A. Kritzer 375 *
Lyckle Kuipers 375 *
Dave Lageschulte 375 *
Noel Langdon 375 *
Mrs. Noel Langdon 375 *
Bernard Laurent 375 *
Corinne Laurent 375 *
Jill A. Lee 375 *
Herbert I. Lee 375 *
Alan J. Levin DDS 375 *
Cynthia L. Levin 375 *
John T. Lisenby 375 *
Mary Jane Lisenby 375 *
John Londelius 375 *
Patricia Lorenz 375 *
Chi Ting Lui 375 *
Luen Hing Lui 375 *
-37-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Michael Lupynec 375 *
Stephanie Lupynec 375 *
Neil G. Macey 375 *
Sharon Marks 375 *
Stanley Marks 375 *
David K. Marshall 375 *
Janet M. Marshall 375 *
Earnest Mathis 42,500 *
Jessie Mathis 375 *
Mathis Family Partners, Ltd. 112,312 2.3%
Don D. Miller 21,250 *
Don E. Montague 375 *
Gary A. Mosko 375 *
Paula L. Mosko 375 *
Leslie L. Neadeau 375 *
Jeane Hays Nerlino 375 *
Vincent Nerlino 375 *
Paul Newland 375 *
Po Ming Ng 375 *
Gertrude R. Nittler 375 *
Roger J. Nittler 375 *
Noraminter Holdings Limited 375 *
Kurt Ohlson 375 *
-38-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Tam Ohlson 375 *
868982 Ontario Inc. 375 *
932027 Ontario Inc. 375 *
Carol R. Paderski 375 *
David R. Paderski 375 *
Fong Nei Pak 375 *
C.K.C. Partners 375 *
Stuart W. Pattison 375 *
Gary B. Peterson 375 *
Gordon E. Peterson 375 *
Dana L. Phillips 375 *
Ramon D. Phillips 375 *
C.R. Plaxton 375 *
Gail E. Ploen 375 *
Jeff P. Ploen 375 *
Annette Pluss 375 *
Richard G. Pluss 375 *
Jeffrey B. Preitauer 375 *
Michelle Preitauer 375 *
Gregory Pusey 375 *
Jill Pusey 375 *
Adam Radley 375 *
-39-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Pamela S. Randall 375 *
Richard Randall 375 *
Gisela Ratcliff 375 *
Richard Ratcliff 375 *
Debra S. Rhoads 375 *
Mitchell E. Rhoads 375 *
A. J. Robbins 375 *
Barbara J. Robbins 375 *
John Robertson 375 *
Shane XG Rodgers 375 *
Danielle L. Rosendahl 375 *
Steven F. Rosendahl 375 *
Len Rothstein 375 *
Dan Rudden 375 *
Peg Rudden 375 *
Martha H. Rudman 375 *
Ronald L. Rudman 375 *
Barry Schechter 375 *
Suzanne Schechter 375 *
John W. Scherer 375 *
Edward Schlauch 375 *
Janice Schneider 375 *
-40-
Shares Beneficially
Owned and Offered As of
the Offering Date
Name
of Beneficial Owner Number Percent
------------------- ------ -------
Richard Schneider 375 *
Chester P. Schwartz 375 *
Louise S. Schwartz 375 *
Adele A. Seger 375 *
Chad Seger 375 *
Shaneko Investment
Corporation 375 *
Jeanette I. Shaw 375 *
Jerry L. Shaw 375 *
Douglas Shields 375 *
Mary D. Silleck 375 *
R. Hayden Silleck 375 *
Beverle A. Skufca 375 *
William Skufca 375 *
Martha Sue Sloven 375 *
Sam S. Sloven 375 *
Snoflake Limited 375 *
Stewart Somers 375 *
Izzy Sonenreich 375 *
Surfco International, Inc. 112,313 2.3%
Dirk Tinley 375 *
Donald S. Unruh 42,500 *
Ronald Wilson 42,500 *
Paul D. Yoder 21,250 *
* Less than 1%
-41-
Information Regarding the Selling Stockholders.
The shares of our common stock which the selling stockholders or their pledgees,
donees, transferees or other successors in interest are offering for resale will
be sold from time to time in one or more of the following transactions:
o Block transactions;
o Transactions on the Bulletin Board or on such other market on which
our common stock may from time to time be trading;
o Privately negotiated transactions;
o Through the writing of options on the shares;
o Short sales; or
o Any combination of these transactions
The sale price to the public in these transactions may be:
o The market price prevailing at the time of sale;
o A price related to the prevailing market price;
o Negotiated prices; or
o Such other price as the selling stockholders determine from time to
time.
The selling stockholders may not offer their shares for sale until we close
our offering of up to 1,000,000 shares and then not until our common stock is
listed for trading on the Bulletin Board or the Pink Sheets.
In the event that we permit or cause this prospectus to lapse, the selling
stockholders may sell shares of our common stock pursuant to Rule 144 under the
Securities Act of 1933. The selling stockholders will have the sole and absolute
discretion not to accept any purchase offer or make any sale of these shares of
our common stock if they deem the purchase price to be unsatisfactory at any
particular time.
The selling stockholders or their pledges, donees, transferees or other
successors in interest, may also sell these shares of our common stock directly
to market makers acting as principals and/or broker-dealers acting as agents for
themselves or their customers. These broker-dealers may receive compensation in
the form of discounts, concessions or commissions from the selling stockholders
and/or the purchasers of these shares of our common stock for whom such
broker-dealers may act as agents or to whom they sell as principal, or both. As
to a particular broker-dealer, this compensation might be in excess of customary
commissions. Market makers and block purchasers purchasing these shares of our
common stock will do so for their own account and at their own risk. It is
possible that a selling stockholder will attempt to sell shares of our common
stock in block transactions to market makers or other purchasers at a price per
share which may be below the prevailing market price of our common stock. There
can be no assurance that all or any of these shares of our common stock offered
hereby will be issued to, or sold by, the selling stockholders. Upon effecting
the sale of any of these shares of our common stock offered under this
-42-
prospectus, the selling stockholders and any brokers, dealers or agents, hereby,
may be deemed "underwriters" as that term is defined under the Securities Act of
1933 or the Securities Exchange Act of 1934, or the rules and regulations
thereunder.
Alternatively, the selling stockholders may sell all or any part of the
shares of our common stock offered hereby through an underwriter. No selling
stockholder has entered into any agreement with a prospective underwriter and
there is no assurance that any such agreement will be entered into. If a selling
stockholder enters into an agreement or agreements with an underwriter, then the
relevant details will be set forth in a supplement or revision to this
prospectus.
The selling stockholders and any other persons participating in the sale or
distribution of these shares of our common stock will be subject to applicable
provisions of the Securities Exchange Act of 1934 and the rules and regulations
thereunder including, without limitation, Regulation M. These provisions may
restrict activities of, and limit the timing of purchases and sales of any of
these shares of our common stock by, the selling stockholders. Furthermore,
pursuant to Regulation M, persons engaged in a distribution of securities are
prohibited from simultaneously engaging in market making and other activities
with respect to the securities for a specified period of time prior to the
commencement of the distributions, subject to specified exceptions or
exemptions. These regulations may affect the marketability of these shares of
our common stock.
We will pay substantially all of the expenses incident to the registration
and offering of our common stock, other than commissions or discounts of
underwriters, broker-dealers or agents.
-43-
PLAN OF DISTRIBUTION
We are offering a minimum of 500,000 shares and a maximum of 1,000,000
shares on a best- efforts basis directly to the public through our officers and
directors, as well as through securities brokers-dealers who are members of the
NASD. Our officers and directors will not receive any compensation for assisting
us with the offering, but NASD members will receive a commission of $.26 for
each share sold. We will also issue to NASD members one common stock purchase
warrant for each ten shares sold. Each warrant will be exercisable to purchase
one share of our common stock at $2.40 per share commencing one year from the
date of this prospectus and for a period of four years thereafter. The warrants
may not be assigned, transferred or hypothecated for a period of one year except
to officers and partners, but not directors, of the selling NASD members. No
broker-dealer has agreed to participate in the offering as of the date of this
prospectus.
We may provide NASD members who participate in the offering with a list of
persons who we believe may be interested in purchasing shares. These NASD
members may sell a portion of the shares to such persons.
We intend to apply to list our common stock on the Electronic Bulletin
Board. Unless and until the common stock is accepted for listing, no public
market will develop for the resale of the securities.
Prior to this offering, there has been no market for our securities.
Accordingly, the public offering price for the shares was determined solely by
us. Among the factors we considered in determining the public offering price
were our record of operations, our current financial condition, our future
prospects, the background of our management, and the general condition of the
equity securities market.
Method of Subscribing.
Persons may subscribe by completing and returning our subscription
agreement. The offering price of $2.00 per share must accompany the subscription
agreement. The minimum purchase is 1,000 shares for $2,000. Certificates for the
shares subscribed will be issued within three business days following the
closing of the offering.
Selling Period.
The selling period of the offering will terminate 90 days from the date of
this prospectus unless extended for up to an additional 60 days.
Minimum-Maximum and Escrow.
Until the minimum 500,000 shares are sold, all funds will be deposited in a
non-interest bearing escrow account at Key Bank, Denver, Colorado. In the event
that 500,000 shares are not sold during the 90-day selling period commencing on
-44-
the date of this prospectus, all funds will be returned to investors without
deduction or interest. If 500,000 shares are sold, we may either continue the
offering for the remainder of the selling period or close the offering at any
time.
Right to Reject.
We reserve the right to reject any subscription, and to withdraw the
offering at any time prior to acceptance of the subscriptions received, if
acceptance of a subscription would result in the violation of any laws to which
we are subject.
RELATED PARTY AND OTHER MATERIAL TRANSACTIONS
In April, 2000 we entered into a license agreement with Horn Interactive,
Inc., a company owned and controlled by Mr. Horn, the Chairman of our board of
directors, under which we received an exclusive and perpetual license for the
software currently powering our Web site for $1.00 together with the issuance of
863,121 shares of our common stock to Mr. Horn. In the future, we may pay fees
to Horn Interactive for software development. Any payments to any affiliated
company, including Horn Interactive, will be approved by the independent members
of our board of directors and will be fair, reasonable and consistent with fees
and charges which would be assessed by non- affiliates in our market area.
DESCRIPTION OF CAPITAL STOCK
General.
We are authorized to issue 25,000,000 shares of common stock, no par value
per share, and 10,000,000 shares of preferred stock, no par value per share.
Common Stock.
At June 30, 2000, there were 5,000,000 shares of common stock outstanding.
The holders of common stock are entitled to one vote per share on all matters
submitted to a vote of stockholders, including the election of directors. There
is no right to cumulate votes in the election of directors. The holders of
common stock are entitled to any dividends that may be declared by the Board of
Directors out of funds legally available therefor subject to the prior rights of
holders of preferred stock and any contractual restrictions we have against the
payment of dividends on common stock. In the event of our liquidation or
dissolution, holders of common stock are entitled to share ratably in all assets
remaining after payment of liabilities and the liquidation preferences of any
outstanding shares of preferred stock.
Holders of common stock have no preemptive rights and have no right to
convert their common stock into any other securities. All of the outstanding
shares of common stock are fully paid and nonassessable.
-45-
Preferred Stock.
Shares of preferred stock may be issued from time to time in one or more
series with such designations, voting powers, if any, preferences and relative,
participating, optional or other special rights, and such qualifications,
limitations and restrictions, as are determined by resolution of our Board of
Directors. The issuance of preferred stock may have the effect of delaying,
deferring or preventing a change in control of our company without further
action by stockholders and could adversely affect the rights and powers,
including voting rights, of the holders of common stock. In certain
circumstances, the issuance of preferred stock could depress the market price of
the common stock. There are no shares of Preferred Stock outstanding.
Dividends.
We do not intend to pay dividends on our capital stock in the foreseeable
future.
SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of the Offering, we will have 6,000,000 shares outstanding,
including 2,316,250 shares which have been registered by this prospectus and
3,683,750 shares which are restricted shares but may be sold under Rule 144
commencing in June 2001.
In general, under Rule 144 as currently in effect, a person, or persons
whose shares are aggregated, who owns shares that were purchased from us, or any
affiliate, at least one year previously, including a person who may be deemed
our affiliate, is entitled to sell within any three- month period, a number of
shares that does not exceed the greater of:
o 1% of the then outstanding shares of our common stock; or
o The average weekly trading volume of our common stock during the four
calendar weeks preceding the date on which notice of the sale is filed
with the Securities and Exchange Commission.
Sales under Rule 144 are also subject to manner of sale provisions, notice
requirements and the availability of current public information about us. Any
person who is not deemed to have been our affiliate at any time during the 90
days preceding a sale, and who owns shares within the definition of "restricted
securities" under Rule 144 under the Securities Act that were purchased from us,
or any affiliate, at least two years previously, is entitled to sell such shares
under Rule 144(k) without regard to the volume limitations, manner of sale
provisions, public information requirements or notice requirements.
Future sales of restricted common stock under Rule 144 or otherwise or of
the shares which we are registering under this prospectus could negatively
-46-
impact the market price of our common stock. We are unable to estimate the
number of shares that may be sold in the future by our existing stockholders or
the effect, if any, that sales of shares by such stockholders will have on the
market price of our common stock prevailing from time to time. Sales of
substantial amounts of our common stock by existing stockholders could adversely
affect prevailing market prices.
EXPERTS
Our financial statements included in this prospectus as of and for the
period ended April 30, 2000, have been included in reliance on the reports of
Hausser & Taylor, LLP, independent certified public accountants, given on the
authority of this firm as experts in accounting and auditing.
The financial statements of Haleakala Enterprises, Inc. for the years ended
December 31, 1999 and 1998 and the period from November 26, 1996 (date of
inception) to December 31, 1999 have been included in reliance upon the report
of Angell & Deering, independent certified public accountants, given on the
authority of this firm as experts in accounting and auditing. Angell & Deering
have not audited or reviewed the unaudited interim financial information and
have not expressed an opinion or any other form of assurance with respect to
such financial information.
LEGAL MATTERS
The validity of our common stock offered hereby will be passed upon for us
by the Law Office of Gary A. Agron, Englewood, Colorado. Mr. Agron owns 112,312
shares of our common stock.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Securities and Exchange Commission, Washington, D.C.
20549, a registration statement on Form SB-2 under the Securities Act of 1933
with respect to our common stock offered by this prospectus. This prospectus
does not contain all of the information set forth in the registration statement
and the exhibits to the registration statement. For further information with
respect to OneDentist.com, Inc., and our common stock offered hereby, reference
is made to the registration statement and the exhibits filed as part of the
registration statement. Following the effective date of the prospectus, we will
be required to file periodic reports with the Securities and Exchange
Commission, including quarterly reports, annual reports which include out
audited financial statements and proxy statements. The registration statement,
including exhibits thereto, and all of our periodic reports may be inspected
without charge at the Securities and Exchange Commission's principal office in
Washington, D.C., and copies of all or any part thereof may be obtained from the
Public Reference Section of the Securities and Exchange Commission, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Securities and Exchange
Commission's regional offices located at Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661 and at 7 World Trade Center, 13th
Floor, New York, New York 10048, after payment of fees prescribed by the
Securities and Exchange Commission. You may obtain additional information
regarding the operation of the Public Reference Section by calling the
Securities and Exchange Commission at 1-800-SEC-0330. The Securities and
Exchange Commission also maintains a World Wide Web site which provides on-line
access to reports, proxy and information statements and other information
regarding registrants that file electronically with the Securities and Exchange
Commission at the address: http://www.sec.gov.
-47-
INDEX TO FINANCIAL STATEMENTS
Page
----
OneDentist Resources, Inc.
Pro Forma Financial Information
Pro Forma Balance Sheet ......................................... F-1
Pro Forma Statement of Operations ............................... F-2
Pro Forma Notes ................................................. F-3
OneDentist Resources, Inc.
Independent Auditors' Report .................................... F-4
Balance Sheet ................................................... F-5
Statements of Operations ........................................ F-6
Statements of Stockholders' Equity .............................. F-7
Statements of Cash Flows ........................................ F-8
Notes to Financial Statements ................................... F-9
Haleakala Enterprises, Inc.
Independent Auditors' Report .................................... F-14
Balance Sheets as of April 30, 2000 (unaudited) and
December 31, 1999 .............................................. F-15
Statements of Operations for the four months ended
April 30, 2000 and 1999 (unaudited) and for the period from
November 27, 1996 (date of inception) to April 30, 2000
(unaudited) and for the years ended December 31, 1999 and 1998
and for the period from November 27, 1996 (date of inception)
to December 31, 1999 ........................................... F-16
Statements of Changes in Stockholders' Equity (Deficit)
for the four months ended April 30, 2000 (unaudited) and
for the years ended December 31, 1999, 1998, 1997 and 1996 ..... F-17
Statements of Cash Flows for the four months ended
April 30, 2000 and 1999 (unaudited) and for the period from
November 27, 1996 (date of inception) to April 30, 2000
(unaudited) and for the years ended December 31, 1999 and 1998
and for the period from November 27, 1996 (date of inception)
to December 31, 1999 ........................................... F-18
Notes to Financial Statements ................................... F-19
OneDentist Resources, Inc.
(A Development Stage Company)
PRO FORMA FINANCIAL INFORMATION
The unaudited pro forma combined financial statements give effect to the merger
using the purchase method of accounting. These unaudited pro forma financial
statements have been prepared as if the merger of One Dentist Resources, Inc.
and Haleakala Enterprises, Inc. had occurred on April 30, 2000. The business
combination was closed effective June 30, 2000 with the shareholders of
OneDentist Resources, Inc. succeeding to the controlling interest in Haleakala
Enterprises, Inc. in a transaction commonly known as a "reverse merger". This
reverse acquisition will be recorded as a re-capitalization with Haleakala
Enterprises, Inc. considered the acquirer.
PRO FORMA BALANCE SHEET
As at April 30, 2000
Haleakala Proforma
ASSETS Enterprises, Inc. OneDentist.com, Inc. Balance Sheet
------ ----------------- -------------------- -------------
CURRENT ASSETS
Cash and cash equivalents $ -- $ 259,749 $ 259,749
Deferred costs -- 26,666 26,666
--------- --------- ---------
$ -- $ 286,415 $ 286,415
========= ========= =========
LIABILITIES AND STOCKHOLDER'S EQUITY
- ------------------------------------
CURRENT LIABILITIES
Accounts payable $ 3,600 $ 59,915 $ 63,515
Accounts payable, officer -- 5,787 5,787
Accounts payable, related party -- 3,096 3,096
Accrued payroll and related taxes -- 407 407
--------- --------- ---------
Total current liabilities 3,600 69,205 72,805
--------- --------- ---------
COMMITMENTS
STOCKHOLDER'S EQUITY
Common stock 2,251 282,501 284,752
Deficit accumulated during the development stage (5,851) (65,291) (71,142)
--------- --------- ---------
Total stockholders' equity (3,600) 217,210 213,610
--------- --------- ---------
$ -- $ 286,415 $ 286,415
========= ========= =========
The accompanying notes are an integral part of these financial statements.
F-1
OneDentist Resources, Inc.
(A Development Stage Company)
PROFORMA STATEMENT OF OPERATIONS
Four months ended April 30, 2000
Haleakala Statement
Enterprises, Inc. OneDentist.com, Inc. of Operations
----------------- -------------------- -------------
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES $ 3,600 $ 63,841 $ 67,441
----------- ----------- -----------
OPERATING LOSS (3,600) (63,841) (67,441)
OTHER INCOME
Interest income -- 700 700
----------- ----------- -----------
NET LOSS $ (3,600) $ (63,141) (66,741)
=========== =========== ===========
BASIC AND DILUTIVE LOSS PER
SHARE $ (0.0036) $ (589.27) $ (0.013)
=========== =========== ===========
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 1,000,000 107.15 5,000,000
=========== =========== ===========
The accompanying notes are an integral part of these financial statements.
F-2
OneDentist Resources, Inc.
(A Development Stage Company)
Notes to Pro Forma Financial Statements
The unaudited pro forma combined financial statements give effect to the
merger using the purchase method of accounting. These unaudited pro forma
financial statements have been prepared as if the merger of OneDentist.com, Inc.
and Haleakala Enterprises, Inc. occurred April 30, 2000.
Note 1. Merger of OneDentist.com, Inc. and Haleakala Enterprises, Inc.
At April 30, 2000, Haleakala Enterprises, Inc. (Haleakala) has
25,000,000 shares of no par value common stock authorized of which
1,000,000 shares are issued and outstanding. Haleakala has 10,000,000
shares of no par value preferred stock, none of which are issued or
outstanding. At April 30, 2000, OneDentist.com, Inc. has authorized
850 shares of no par value common stock, 114.29 shares issued and
outstanding. On June 30, 2000, the Companies entered into a share
exchange agreement. Haleakala effectuated a reverse stock split of its
outstanding common stock, reducing 1,000,000 shares to 750,000 shares.
The shareholders of OneDentist.com, Inc. exchanged all their
outstanding shares with Haleakala for 4,250,000 newly issued shares of
Haleakala's no par value common stock.
F-3
To the Stockholders
OneDentist Resources, Inc.
Columbus, Ohio
Independent Auditors' Report
----------------------------
We have audited the accompanying balance sheet of OneDentist Resources,
Inc. (a development stage company) (fka OneDentist.com, Inc.) as of April 30,
2000, and the related interim statements of operations, stockholders' equity,
and cash flows for the four months then ended and for the period from July 16,
1999 (date of inception) through December 31, 1999. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
As discussed in Note 1 to the financial statements, the Company has been in
the development stage since its inception on July 16, 1999. Realization of a
major portion of the assets is dependent upon the Company's ability to meet its
future financing requirements and the success of future operations, the outcome
of which cannot be determined at this time.
In our opinion subject to the effect on the financial statements of the
uncertainties as described in the preceding paragraph, the financial statements
referred to above present fairly, in all material aspects, the financial
position of OneDentist Resources, Inc. (a development stage company) as of April
30, 2000, and the results of its operations and its cash flows for the four
months then ended and for the period from July 16, 1999 (date of inception)
through December 31, 1999 in conformity with generally accepted accounting
principles.
/s/ Hausser + Taylor LLP
June 20, 2000, except for Note 6
as to which the date is June 30, 2000
Columbus, Ohio
F-4
OneDentist Resources, Inc.
(A Development Stage Company)
BALANCE SHEET
April 30, 2000
--------------
ASSETS
------
CURRENT ASSETS
Cash and cash equivalents $ 259,749
Deferred costs (Note 1) 26,666
---------
$ 286,415
=========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES
Accounts payable $ 59,915
Accounts payable, officer (Note 4) 5,787
Accounts payable, related party (Note 4) 3,096
Accrued payroll and related taxes 407
---------
Total current liabilities 69,205
---------
COMMITMENTS (Note 2)
STOCKHOLDERS' EQUITY
Common stock, no par value, 850 shares authorized,
114.29 shares issued
and outstanding (Note 6) 282,501
Deficit accumulated during the development stage (65,291)
---------
217,210
---------
$ 286,415
=========
The accompanying notes are an integral part of these financial statements.
F-5
OneDentist Resources, Inc.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
Four months ended April 30, 2000 and the period from
July 16, 1999 (date of inception)
through December 31, 1999
-----------------------------------------------------
2000 1999
---- ----
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES $ 63,841 $ 2,150
-------- --------
OPERATING LOSS (63,841) (2,150)
OTHER INCOME
Interest income 700 --
-------- --------
NET LOSS $(63,141) $ (2,150)
======== ========
BASIC AND DILUTIVE LOSS PER SHARE $(589.27) $ (21.50)
======== ========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 107.15 100
======== ========
The accompanying notes are an integral part of these financial statements.
F-6
OneDentist Resources, Inc.
(A Development Stage Company)
STATEMENTS OF STOCKHOLDERS' EQUITY
Four months ended April 30, 2000 and the period from
July 16, 1999 (date of inception) through December 31, 1999
-----------------------------------------------------------
Deficit
Accumulated
Number During The
of Common Development
Shares Stock Stage
--------- -------- -----------
Issuance of common stock 100.00 $ 1 $ --
Net loss for the period from July 16, 1999
through December 31, 1999 -- -- (2,150)
--------- -------- --------
Balance December 31, 1999 100.00 1 (2,150)
Sale of common stock, net of related
costs of $30,000 (Note 6) 14.29 282,500 --
Net loss for the four months ended
April 30, 2000 -- -- (63,141)
--------- -------- --------
Balance April 30, 2000 114.29 $282,501 $(65,291)
========= ======== ========
The accompanying notes are an integral part of these financial statements.
F-7
OneDentist Resources, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
Four months ended April 30, 2000 and the period from
July 16, 1999 (date of inception) through December 31, 1999
-----------------------------------------------------------
2000 1999
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (63,141) $ (2,150)
--------- ---------
Adjustments to reconcile net loss to net cash used in
operating activities:
Increase in current assets:
Deferred costs (26,666) --
Increase in current liabilities:
Accounts payable 57,766 2,150
Accounts payable, officer 5,787 --
Accounts payable, related party 3,096 --
Accrued payroll and related taxes 407 --
--------- ---------
Total adjustments 40,390 2,150
--------- ---------
Net cash used in operating activities (22,751) --
--------- ---------
CASH FLOW FROM FINANCING ACTIVITIES
Net proceeds from sale of common stock 282,500 --
--------- ---------
Net cash provided by financing activities 282,500 --
--------- ---------
NET INCREASE IN CASH AND CASH EQUIVALENTS 259,749 --
CASH AND CASH EQUIVALENTS - Beginning -- --
--------- ---------
CASH AND CASH EQUIVALENTS - Ending $ 259,749 $ --
========= =========
The accompanying notes are an integral part of these financial statements.
F-8
OneDentist Resources, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies
The following is a summary of significant accounting policies
followed in the preparation of the financial statements.
A. Business Organization and Basis of Presentation - OneDentist
Resources, Inc. (fka OneDentist.com, Inc.) (a development stage
company) (the Company) was incorporated on July 16, 1999 in the
State of Ohio. The Company has been in the development stage
since its inception. The Company was formed to develop a complete
package of Internet tools and resources designed to enhance the
business functions and lifestyle of dental practitioners.
The accompanying financial statements have been prepared in
conformity with generally accepted accounting principles, which
contemplates continuation of the Company as a going concern.
OneDentist.com, Inc. is in the process of raising capital which
will be used to accelerate sales and marketing efforts for their
products. As OneDentist Resources, Inc. is in the preliminary
stages of marketing, realization of a major portion of the assets
is dependent on obtaining satisfactory and adequate financing for
marketing efforts and the success of future operations, the
outcome of which cannot be determined at this time. See Note 2
and Note 6.
B. Cash Equivalents - For the purpose of the statement of cash flow,
the Company considers cash and cash equivalents to include cash
and money market investments with maturities at purchase of three
months or less. There were no such investments at April 30, 2000.
C. Concentration of Credit Risk - The Company maintains its demand
deposits in one financial institution located in Columbus, Ohio.
All deposits are insured by the Federal Deposit Insurance
Corporation up to $100,000. At April 30, 2000 and at times
throughout the year, the Company's demand deposits were in excess
of the insured limit.
D. Income Taxes - Income taxes are provided based on the liability
method of accounting. Income tax benefits of net operating loss
carryforwards have been offset with an allowance equal to the
benefit which will be realized in future periods.
E. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
these estimates.
F. Advertising - All of the Company's advertising costs are of the
nondirect response type. The Company expenses all advertising
costs as incurred or at the time the advertising takes place.
Total advertising costs incurred during the four months ended
April 30, 2000 amounted to $47.
F-9
OneDentist Resources, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Note 1. Summary of Significant Accounting Policies (Continued)
G. Earnings Per Share - Basic earnings per share is computed using
the weighted average number of shares of common stock outstanding
during the period. Diluted earnings per share reflect the
dilutive effect of common stock equivalents using the treasury
stock method. There are no dilutive common stock equivalents
outstanding at April 30, 2000 or December 31, 1999. Subsequent to
April 30, 2000, the Company effected a 43,750 to 1 reverse stock
split of certain shares issued in connection with the Company's
Private Placement Offering (See Note 6). The accompanying balance
sheet and statements of operation have been restated to reflect
this split.
H. Revenue Recognition - OneDentist Resources, Inc. intends to
generate revenue through fees charged to subscribers to web
portals, advertising income from third party advertisers at web
portals, percentage interests in the income derived by third
parties who provide seminars, training and speeches at web
portals and commissions earned on the sale of products and
services at a web store. Subscribers will be charged a monthly
fee. Through June 30, 2000, OneDentist.com, Inc. is offering 12
month subscriptions free of charge to certain "Beta" subscribers.
Revenue will be recognized when earned.
I. Organization Costs and Start-up Expenses - In accordance with
Statement of Position 98-5, "Reporting on the Costs of Start-up
Activities," organization costs and start-up expenditures are
being expensed as incurred.
J. Fair Value of Financial Instruments - Cash, accounts payable and
accrued expenses are reflected in the financial statements at
cost, which approximates fair market value because of the
short-term maturity of those instruments.
K. Deferred Costs - The Company has incurred legal fees of $26,666
related to the Registration Statement on Form SB-2 under the
provision of the Securities and Exchange Commission. The costs
associated with Form SB-2 in raising capital will reduce equity,
if successful (See Note 2).
Note 2. Commitments
The Company leases office space under a month-to-month lease
which requires monthly payments of $1,545. Rent expense for the
four months ended April 30, 2000 amounted to $6,180.
F-10
OneDentist Resources, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Note 2. Commitments (Continued)
The Company entered into a consulting agreement with Jag Capital,
Inc. The consulting agreement required the Company to pay Jag
Capital, Inc. $25,000 for their assistance with the Company's
limited private placement, which is included in accounts payable
on the accompanying balance sheet at April 30, 2000. The
consulting agreement also requires the Company to pay Jag
Capital, Inc. $2,000 per month for twelve months, beginning May
2000 for financial consulting. The amount due of $24,000 is
payable regardless of services performed and is included in
accounts payable on the accompanying balance sheet. A principal
shareholder of Jag Capital, Inc. is a shareholer of Haleakala
Enterprises, Inc. (see Note 6).
As part of the Company's public offering, the Company will pay
third party underwriters a success fee, not to exceed 10% of
funds raised and a non-accountable expense allowance equal to 3%
of funds raised. In addition, the Company will issue warrants to
third party underwriters to purchase an aggregate of 10% of the
securities issued. The warrants will be exercisable from the date
of the initial offering and for a period of 5 years from that
date at 120% of the price per share as paid by the investors at
the initial offering.
The Company entered into a contract with an attorney to prepare a
Registration Statement on Form SB-2 under the provisions of the
Securities and Exchange Commission. (See Note 6). The legal fee
for preparation of the Registration Statement is $80,000 of which
$26,666 was billed and paid and is included in deferred costs.
The attorney is a shareholder of Haleakala Enterprises, Inc. (See
Note 6).
Note 3. License Agreement
The Company entered into a license agreement with Horn
Interactive, Inc. (Horn) for the use of the software underlying
the OneDentist website developed by Horn. The Company paid Horn a
license fee of $1. Horn is owned by an officer and stockholder of
the Company.
Note 4. Related Party Transactions
During the four months ended April 30, 2000, the Company
reimbursed Classic Impressions, Inc., a company related through
common ownership, $6,959 for payroll and related expenses. At
April 30, 2000, the Company has accounts payable, related party
totaling $3,096.
At April 30, 2000, the Company has accounts payable, officer
totaling $5,787 for reimbursement of expenses.
F-11
OneDentist Resources, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Note 5. Income Taxes
Deferred income taxes arise from temporary differences resulting
from income and expense items reported for financial accounting
and tax reporting purposes in different periods. Deferred taxes
are classified as current or long-term, depending on the
classification of the assets and liabilities to which they
relate. Deferred taxes arising from temporary differences that
are not related to an asset or liability are classified as
current or long-term depending on the periods in which the
temporary differences are expected to reverse.
The components of the deferred tax asset consist of the
following:
April 30, 2000
--------------
Deferred tax asset arising from the benefit
of federal net operating loss carryforward $ 21,470
Less valuation allowance (21,470)
----------
Net noncurrent asset $ --
==========
The Company has federal net operating loss carryforwards
approximating $63,000 which expire in 2020.
Note 6. Stock Transactions and Subsequent Events
Issuance of Stock
-----------------
The founding shareholders of the Company received an aggregate of
100 shares of the Company's common stock at incorporation for $1.
The shareholders contributed their time and expertise to the
Company. The value of this contributed time is not reflected in
the accompanying financial statements since it is not susceptible
to objective measurement or valuation by management.
Stock Split
-----------
During 2000, the Company issued 625,000 shares of common stock in
connection with its limited private placement offering that
raised equity capital of $312,500 less related costs of $30,000.
Effective June 30, 2000, OneDentist Resources, Inc. completed a
reverse stock split of the 625,000 shares issued as a result of
the private placement offering, reducing the number of shares
issued from 625,000 to 14.29. The accompanying balance sheet and
statement of operations have been restated to reflect the split.
F-12
OneDentist Resources, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
Note 6. Stock Transactions and Subsequent Events (Continued)
Merger
------
Effective June 30, 2000, OneDentist Resources, Inc. (fka
OneDentist.com, Inc.) executed a share exchange agreement with
Haleakala Enterprises, Inc. ("Haleakala"), a Colorado
corporation. Haleakala is a privately owned corporation whose
shares are widely held among approximately 235 stockholders.
Haleakala was organized in November 1996 for the purpose of
merging in the future with a company seeking a larger stockholder
base. Haleakala has not been operational since it was organized
and has no specific plan of operations and virtually no assets or
liabilities. Haleakala will effectuate a reverse stock split of
its outstanding common stock, reducing to a total of 750,000
outstanding shares. OneDentist.com, Inc. stockholders shall
exchange 100% of their shares for 4,250,000 shares of Haleakala.
Haleakala will change its name to OneDentist Resources, Inc.
Immediately after the exchange, the ownership of the Company will
be 15% by existing Haleakala stockholders and 85% by the existing
OneDentist.com, Inc. stockholders. The merger will be treated as
a reverse merger. This reverse merger will be recorded as a
re-capitalization with Haleakala as the acquirer.
The following pro forma combined balance sheet gives effect to
the merger using the purchase method of accounting as if the
merger had occurred on April 30, 2000.
PRO FORMA BALANCE SHEET
As at April 30, 2000
--------------------
(Unaudited) Proforma
Haleakala OneDentist Balance
Enterprises, Inc. Resources, Inc. Sheet
----------------- --------------- ---------
Total assets $ -- $ 286,415 $ 286,415
========= =========== =========
Total liabilities $ 3,600 $ 69,205 $ 72,805
--------- ----------- ---------
Stockholders' equity
Common stock 2,251 282,501 284,752
Deficit accumulated
during the
development stage (5,851) (65,291) (71,142)
--------- ----------- ---------
Total
stockholders'
equity (3,500) 217,210 213,610
--------- ----------- ---------
Total liabilities
and stockholders'
equity $ -- $ 286,415 $ 286,415
========= =========== ==========
F-13
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Haleakala Enterprises, Inc.
We have audited the accompanying balance sheet of Haleakala Enterprises, Inc. (a
development stage Company) as of December 31, 1999, and the related statements
of operations, changes in stockholders' equity (deficit) and cash flows for the
years ended December 31, 1999 and 1998 and for the period from November 27, 1996
(date of inception) to December 31, 1999. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Haleakala Enterprises, Inc. as
of December 31, 1999, and the results of its operations and its cash flows for
the years ended December 31, 1999 and 1998 and for the period from November 27,
1996 (date of inception) to December 31, 1999 in conformity with generally
accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As shown in the financial statements,
the Company has no assets as of December 31, 1999. As discussed in Note 1 to the
financial statements, the Company's lack of working capital raises substantial
doubt about its ability to continue as a going concern. Management's plans in
regard to these matters are also discussed in Note 1. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
Angell & Deering
Certified Public Accountants
Denver, Colorado
April 18, 2000
F-14
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
BALANCE SHEETS
ASSETS
April 30, December 31,
2000 1999
------- -------
(Unaudited)
Current Assets:
Cash and cash equivalents $ -- $ --
------- -------
Total Assets $ -- $ --
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
----------------------------------------------
Current Liabilities:
Accounts payable - trade $ 3,600 $ --
------- -------
Stockholders' Equity (Deficit):
Preferred stock: no par value, 10,000,000 shares
authorized, none issued or outstanding -- --
Common stock: no par value, 25,000,000 shares
authorized, 1,000,000 shares issued and outstanding 2,251 2,251
Deficit accumulated during the development stage (5,851) (2,251)
------- -------
Total Stockholders' Equity (Deficit) (3,600) --
------- -------
Total Liabilities and Stockholders' Equity (Deficit) $ -- $ --
======= =======
The accompanying notes are an integral
part of these financial statements.
F-15
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
Four Months Ended Inception To Year Ended Inception To
April 30, April 30, December 31, December 31,
2000 1999 2000 1999 1998 1999
---- ---- ---- ---- ---- ----
(Unaudited) (Unaudited)
Revenue $ -- $ -- $ -- $ -- $ -- $ --
Operating expenses 3,600 -- 5,851 -- -- 2,251
----------- ------------ ----------- ------------ ------------ -----------
Net Income (Loss) $ (3,600) $ -- $ (5,851) $ -- $ -- $ (2,251)
=========== ============ =========== ============ ============ ===========
Net Income (Loss) Per Share of
Common Stock:
Basic $ -- $ -- $ (.01) $ -- $ -- $ --
=========== ============ =========== ============ ============ ===========
Diluted $ -- $ -- $ (.01) $ -- $ -- $ --
=========== ============ =========== ============ ============ ===========
Weighted Average Number of
Common Shares Outstanding:
Basic 1,000,000 1,000,000 993,400 1,000,000 1,000,000 992,743
Diluted 1,000,000 1,000,000 993,400 1,000,000 1,000,000 992,743
The accompanying notes are an integral
part of these financial statements.
F-16
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
Deficit
Accumulated
Common Stock During The
------------ Development
Shares Amount Stage
------ ------ -----
Balance at November 27, 1996 (inception) -- $ -- $ --
Shares of common stock issued in November
1996 for cash at $.0001 per share 900,000 90 --
Net loss for the period -- -- --
--------- --------- ---------
Balance at December 31, 1996 900,000 90 --
Shares of common stock issued in
February 1997 Private Placement
distribution for no cash, valued
at $.01 per share 100,000 1,000 --
Capital contributed in April 1997 -- 1,161 --
Net loss for the year -- -- (2,251)
--------- --------- ---------
Balance at December 31, 1997 1,000,000 2,251 (2,251)
Net loss for the year -- -- --
--------- --------- ---------
Balance at December 31, 1998 1,000,000 2,251 (2,251)
Net loss for the year -- -- --
Balance at December 31, 1999 1,000,000 2,251 (2,251)
Net loss for the period (unaudited) -- -- (3,600)
--------- --------- ---------
Balance at April 30, 2000 (unaudited) 1,000,000 $ 2,251 $ (5,851)
========= ========= =========
The accompanying notes are an integral
part of these financial statements.
F-17
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
Four Months Ended Inception To Year Ended Inception To
April 30, April 30, December 31, December 31,
2000 1999 2000 1999 1998 1999
---- ---- ---- ---- ---- ----
(Unaudited) (Unaudited)
Cash Flows From Operating Activities:
Net income (loss) $ (3,600) $ -- $(5,851) $-- $-- $(2,251)
Adjustments to reconcile net
income (loss) to net cash (used)
by operating activities:
Issuance of common stock in Private
Placement distribution -- -- 1,000 -- -- 1,000
Changes in liabilities:
Accounts payable 3,600 -- 3,600 -- -- --
------------ ------------ ------- ---- ---- -------
Net Cash (Used) By Operating
Activities -- -- (1,251) -- -- (1,251)
------------ ------------ ------- ---- ---- -------
Cash Flows From Financing Activities:
Contribution of capital -- -- 1,161 -- -- 1,161
Issuance of common stock -- -- 90 -- -- 90
------------ ------------ ------- ---- ---- -------
Net Cash Provided By Financing
Activities -- -- 1,251 -- -- 1,251
------------ ------------ ------- ---- ---- -------
Net Increase in Cash
and Cash Equivalents -- -- -- -- -- --
Cash and Cash Equivalents at
Beginning of Period -- -- -- -- -- --
------------ ------------ ------- ---- ---- -------
Cash and Cash Equivalents at
End of Period $ -- $ -- $ -- $-- $-- $ --
============ ============ ======= ==== ==== =======
Supplemental Disclosure of Cash
Flow Information:
Cash paid during the period for:
Interest $ -- $ -- $ -- $-- $-- $ --
Income taxes -- -- -- -- -- --
The accompanying notes are an integral
part of these financial statements.
F-18
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies
------------------------------------------
Description of Business
-----------------------
Haleakala Enterprises, Inc. (the "Company") was organized on November
27, 1996 as a Colorado corporation. The Company is in the development
stage as is more fully defined in Statement of Financial Accounting
Standards ("SFAS") No. 7, "Accounting and Reporting by Development Stage
Enterprises". The Company intends to evaluate, structure and complete a
merger with, or acquisition of, prospects consisting of private
companies, partnerships or sole proprietorships. The Company may seek to
acquire a controlling interest in such entities in contemplation of
later completing an acquisition.
Unaudited Interim Financial Statements
--------------------------------------
The financial statements as of April 30, 2000 and for the four months
ended April 30, 2000 and 1999 and for the period from November 27, 1996
(date of inception ) to April 30, 2000 are unaudited, however in the
opinion of management of the Company, all adjustments (consisting solely
of normal recurring adjustments) necessary to a fair presentation of the
financial statements for the interim periods have been made.
Basis of Presentation
---------------------
The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. The
financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the
amount and classification of liabilities that might be necessary should
the Company be unable to continue as a going concern. The Company's
continuation as a going concern is dependent upon its ability to
generate sufficient cash flow to meet its obligations on a timely basis
and to obtain additional financing as may be required.
The Company's continued existence is dependent upon its ability to
secure loans from its principal stockholder and/or obtain additional
capital contributions. Future operating expenses will be funded by these
loans or capital contributions. The Company's ability to continue to
meet its obligations is dependent upon obtaining the above financing.
Cash and Cash Equivalents
-------------------------
For purposes of the statements of cash flows, the Company considers all
highly liquid investments with a maturity of three months or less at the
date of purchase to be cash equivalents.
Income Taxes
------------
Deferred income taxes are provided for temporary differences between the
financial reporting and tax basis of assets and liabilities using
enacted tax laws and rates for the years when the differences are
expected to reverse.
Net Income (Loss) Per Share of Common Stock
-------------------------------------------
The Company adopted SFAS No. 128, "Earnings Per Share", which specifies
the method of computation, presentation and disclosure for earnings per
share. SFAS No. 128 requires the presentation of two earnings per share
amounts, basic and diluted.
Basic earnings per share is calculated using the average number of
common shares outstanding. Diluted earnings per share is computed on
the basis of the average number of common shares outstanding plus the
dilutive effect of outstanding stock options using the "treasury
stock" method.
F-19
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies (Continued)
Estimates
---------
The preparation of the Company's financial statements in conformity with
generally accepted accounting principles requires the Company's
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported
amount of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
2. Preferred Stock
---------------
The authorized preferred stock of the Company consists of 10,000,000
shares, no par value. The preferred stock may be issued in series from
time to time with such designation, rights, preferences and limitations
as the Board of Directors of the Company may determine by resolution.
The rights, preferences and limitations of separate series of preferred
stock may differ with respect to such matters as may be determined by
the Board of Directors, including without limitation, the rate of
dividends, method and nature of payment of dividends, terms of
redemption, amounts payable on liquidation, sinking fund provisions (if
any), conversion rights (if any), and voting rights. Unless the nature
of a particular transaction and applicable statutes require approval,
the Board of Directors has the authority to issue these shares without
shareholder approval.
3. Income Taxes
------------
The components of the provision for income taxes are as follows:
Year Ended Inception To
December 31, December 31,
1999 1998 1999
---- ---- ----
Current:
Federal $-- $-- $--
State -- -- --
---- ---- ----
Total -- -- --
---- ---- ----
Deferred:
Federal -- -- --
State -- -- --
---- ---- ----
Total -- -- --
---- ---- ----
Total Provision For Income Taxes $-- $-- $--
==== ==== ====
The provision (benefit) for income taxes reconciles to the amount
computed by applying the federal statutory rate to income before the
provision (benefit) for income taxes as follows:
F-20
HALEAKALA ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
3. Income Taxes (Continued)
Year Ended Inception To
December 31, December 31,
1999 1998 1999
---- ---- ----
Federal statutory rate (34)% (34)% (34)%
State income taxes, net of federal
benefits (3) (3) (3)
Valuation allowance 37 37 37
---- ---- ----
Total --% --% --%
==== ==== ====
The following is a reconciliation of the provision for income taxes
to income before provision for income taxes computed at the federal
statutory rate of 34%.
Year Ended Inception To
December 31, December 31,
1999 1998 1999
---- ---- ----
Income taxes at the federal statutory rate $ -- $ -- $(765)
Federal surtax exemption -- -- 428
State income taxes, net of federal benefits -- -- (68)
Valuation Allowance -- -- 405
----- ----- -----
Total $ -- $ -- $ --
===== ===== =====
Significant components of deferred income taxes as of December 31, 1999
are as follows:
Net operating loss carry forward $ 429
-----
Total deferred tax asset 429
Less valuation allowance (429)
-----
Net Deferred Tax Asset $ --
=====
The Company has assessed its past earnings history and trends and
expiration dates of carryforwards and has determined that it is more
likely than not that no deferred tax assets will be realized. A
valuation allowance of $429 as of December 31, 1999 is maintained on
deferred tax assets which the Company has not determined to be more
likely than not realizable at this time. There was no change in the
valuation allowance for deferred tax assets for the year ended December
31, 1999. The Company will continue to review this valuation on an
annual basis and make adjustments as appropriate.
As of December 31, 1999 the Company had net operating loss carryforwards
of approximately $2,200. The net operating losses can be carried forward
fifteen years to offset future taxable income. The net operating loss
carryforwards expire in 2012.
F-21
HALEAKALA ENTERPRISES INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
4. Proposed Acquisition
--------------------
The Company entered into a Term Sheet for a merger with OneDentist.com,
Inc. ("OneDentist") in February 2000. Under the terms of the Agreement
the Company will exchange 4,250,000 shares of its no par value common
stock for all of the issued and outstanding shares of OneDentist's
common stock. Immediately after the exchange the ownership of the
Company will be 15% by existing Haleakala stockholders and 85% by the
existing OneDentist stockholders. Prior to the merger, the Company plans
to effect a reverse stock split reducing its issued and outstanding
common shares to 750,000. The Company will change its name to
OneDentist.Com, Inc. after the effective date of the merger. The merger
will be treated as a recapitalization of OneDentist, similar to a
reverse acquisition. Therefore, OneDentist will be treated as the
acquiror for accounting purposes, whereas for legal purposes the Company
is the acquiror. Closing is expected in 2000 after all conditions of the
Term Sheet are satisfied including OneDentist raising a minimum of
$300,000 in equity financing.
F-22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Seventh, Registrant's Articles of Incorporation provide as follows:
(c) Indemnification. The corporation shall indemnify, to the maximum extent
permitted by law, any person who is or was a director, officer, agent, fiduciary
or employee of the corporation against any claim, liability or expense arising
against or incurred by such person made party to a proceeding because he is or
was a director, officer, agent, fiduciary or employee of the corporation or
because he is or was serving another entity or employee benefit plan as a
director, officer, partner, trustee, employee, fiduciary or agent at the
corporation's request. The corporation shall further have the authority to the
maximum extent permitted by law to purchase and maintain insurance providing
such indemnification.
(d) Limitation on Director's Liability. No director of this corporation
shall have any personal liability for monetary damages to the corporation or its
shareholders for breach of his fiduciary duty as a director, except that this
provision shall not eliminate or limit the personal liability of a director to
the corporation or its shareholders for monetary damages for: (i) any breach of
the director's duty of loyalty to the corporation or its shareholders; (ii) acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law; (iii) voting for or assenting to a distribution in
violation of Colorado Revised Statutes ss.7-106-401 or the articles of
incorporation if it is established that the director did not perform his duties
in compliance with Colorado Revised Statutes ss.7-108-401, provided that the
personal liability of a director in this circumstance shall be limited to the
amount of the distribution which exceeds what could have been distributed
without violation of Colorado Revised Statutes ss.7-106-401 or the articles of
incorporation; or (iv) any transaction from which the director directly or
indirectly derives an improper personal benefit. Nothing contained herein will
be construed to deprive any director of his right to all defenses ordinarily
available to a director nor will anything herein be construed to deprive any
director of any right he may have for contribution from any other director or
other person.
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. (1)
SEC Registration Fees....................................... $ 1,366
NASD Filing Fee............................................. $ 963
Blue Sky Filing Fees........................................ $ 15,000
Blue Sky Legal Fees......................................... $ 20,000
Printing Expenses........................................... $ 10,000
Legal Fees.................................................. $ 80,000
Accounting Fees............................................. $ 25,000
Transfer Agent Fees......................................... $ 2,000
Miscellaneous Expenses...................................... $ 5,671
---------
Total....................................................... $ 160,000
========
(1) All expenses, except the SEC and NASD registration fees, are
estimated.
II-1
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES
During the last three years (since July 1997), the Registrant sold the
following securities which were not registered under the Securities Act, as
amended:
In June 2000 the Registrant issued an aggregate of 4,250,000 shares to
acquire all of the outstanding common stock of OneDentist.com, Inc., an
Ohio Corporation.
With respect to the above securities issuances, the Registrant relied on
Section 4(2) of the Securities Act of 1933, as amended (the "Securities Act")
and Rule 506 promulgated thereunder.
No advertising or general solicitation was employed in offering the
securities. The securities were issued to a limited number of persons all of
whom were stockholders of OneDentist Resources, Inc. and all of whom were
accredited investors as that term is defined in Rule 501 of Regulation D under
the Securities Act. All were capable of analyzing the merits and risks of their
investment, acknowledged in writing that they were acquiring the securities for
investment and not with a view toward distribution or resale, and understood the
speculative nature of their investment. All common stock issued contained a
restrictive legend prohibiting transfer of the shares except in accordance with
federal securities laws.
ITEM 27. EXHIBIT INDEX.
Exhibit No. Title
----------- -----
3.01 Articles of Incorporation of the Registrant
3.02 Bylaws of the Registrant
5.01 Opinion of Gary A. Agron regarding legality
10.01 License Agreement with Horn Interactive, Inc.
10.02 Agreement with Oxyfresh
10.03 Consulting Agreement
23.01 Consent of Gary A. Agron (see 5.01 above)
23.02 Consent of Angell & Deering
23.03 Consent of Hausser & Taylor, LLP
27.01 Financial Data Schedule
ITEM 28. UNDERTAKINGS.
The Registrant hereby undertakes:
II-2
(a) That insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registration of expenses incurred or paid by a director, officer
or controlling person to the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(b) That subject to the terms and conditions of Section 13(a) of the
Securities Exchange Act of 1934, it will file with the Securities and Exchange
Commission such supplementary and periodic information, documents and reports as
may be prescribed by any rule or regulation of the Commission heretofore or
hereafter duly adopted pursuant to authority conferred in that section.
(c) That any post-effective amendment filed will comply with the applicable
forms, rules and regulations of the Commission in effect at the time such
post-effective amendment is filed.
(d) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof), which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
(e) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(f) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
Offering.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing Form SB-2 and has caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Columbus, Ohio, on August 15, 2000.
OneDentist Resources, Inc.
By: /s/ Richard J. Horn
-----------------------------------------
Richard J. Horn, Chief Executive Officer
Pursuant to the requirements of the Securities Act, as amended, this
Registration Statement has been signed below by the following persons on the
dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Richard J. Horn
- --------------------- Chairman of the Board of Directors August 15, 2000
Richard J. Horn and Chief Executive Officer
/s/ Graydon D. Webb
- ---------------------- President, Chief Operating Officer, August 15, 2000
Graydon D. Webb (Principal Accounting Officer)
and Director
/s/ Gerald S. Strauss
- ---------------------- Secretary and Director August 15, 2000
Gerald S. Strauss
II-4
EXHIBIT INDEX
Exhibit No. Title
3.01 Articles of Incorporation of the Registrant
3.02 Bylaws of the Registrant
5.01 Opinion of Gary A. Agron regarding legality
10.01 Agreement with Horn Interactive, Inc.
10.02 Agreement with Oxyfresh
10.03 Consulting Agreement
23.01 Consent of Gary A. Agron (see 5.01 above)
23.02 Consent of Angell & Deering
23.03 Consent of Hausser + Taylor LLP
27.01 Financial Data Schedule