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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
Form 10-K/A
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2000
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 000-27567
HEALTHCENTRAL.COM
(Exact name of registrant as specified in its charter)
Delaware 94-3250851
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
HealthCentral.com
6005 Shellmound Street, Suite 250
Emeryville, CA 94608
(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code: (510) 250-2500
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, par value $.001 per share
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period than the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. YES [X] NO [_]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [X]
The aggregate market value of the voting stock held by non-affiliates of
the registrant was approximately $12,150,729 as of February 28, 2001, based
upon the closing sale price on the Nasdaq National Market reported for such
date. Shares of Common Stock held by each officer and director and by each
person who owns 5% of more of the outstanding Common Stock have been excluded
in that such persons may be deemed to be affiliates. This determination of
affiliate status is not necessarily a conclusive determination for other
purposes.
There were 50,661,038 shares of the registrant's Common Stock issued and
outstanding as of February 28, 2001.
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PART III
Item 10. Directors and Executive Officers of the Registrant.......... Page 1
Item 11. Executive Compensation...................................... Page 4
Common Stock Ownership of Certain Beneficial Owners and
Item 12. Management.................................................. Page 9
Item 13. Certain Relationships and Related Transactions.............. Page 10
Signatures............................................................ Page 14
The Registrant hereby amends the following items of Part III of its Form
10-K for the fiscal year ended December 31, 2000, filed with the Securities
and Exchange Commission on April 2, 2001:
Item 10. Directors and Executive Officers of the Registrant
Identification of Directors
Our bylaws currently provide that the board of directors shall consist of
six members. Our board of directors is divided into the following three
classes: Class I, whose term will expire at the annual meeting of stockholders
in 2003; Class II, whose term will expire at the annual meeting of
stockholders in 2001; and Class III, whose term will expire at the annual
meeting of stockholders in 2002. After each of these respective elections,
each class of directors will serve staggered three-year terms. As a result,
only one class of directors will be elected at each annual meeting of
stockholders of HealthCentral.com, with the other classes continuing for the
remainder of their respective terms. Effective as of the annual meeting of
stockholders in June 2001, Mr. Greene will not continue as a member of our
board of directors and the bylaws will automatically be amended to decrease
the total number of directors to five.
The directors of the Company and their ages as of April 30, 2001 are as
follows:
Director
Name Age Principal Occupation Since Class
---- --- -------------------- -------- -----
C. Fred Toney.............. 35 Chief Executive Officer,
President and Chief Financial
Officer of HealthCentral.com 2000 III
Host of Dr. Dean Edell radio
Dean S. Edell (1)(2)....... 60 program 1996 III
Albert L. Greene........... 50 Chairman of the Board of
Directors of
HealthCentral.com 1998 II
James J. Hornthal (1)(2)... 47 Vice Chairman of the Board of
Directors of Travelocity.com 1996 II
President and Director of
Michael D. McDonald (1)(2). 45 Global Health Initiatives 1999 II
Miles K. Munger............ 42 Vice President and General
Manager of Merchandising and
Marketing of
HealthCentral.com 2001 I
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(1) compensation committee member
(2) audit committee member
C. Fred Toney has served as our Chief Executive Officer since February
2001, as President and as a director since November 2000 and as Chief
Financial Officer since July 1999 when he joined HealthCentral.com. Mr. Toney
also served as Chief Operating Officer from November 2000 to February 2001.
From August 1992 to July 1999, Mr. Toney served as Senior Managing Director,
Senior Research Analyst and Director of Research at Pacific Growth Equities,
Inc., an investment banking firm. Previously he held investment or research
analyst positions at Volpe, Welty &Company; Donaldson, Lufkin & Jenrette
Securities Corporation and RCM Capital Management; and sales and merchandising
positions at Pharmavite Pharmaceutical Corporation. He also serves on the
boards of directors of private companies. Mr. Toney received a B.A. in both
Economics and English from the University of California, Davis.
Dean S. Edell, M.D. co-founded HealthCentral.com in August 1996, and has
been a director since its inception. From inception to July 1998, Dr. Edell
also served as President and Chief Executive Officer. Dr. Dean Edell has been
a medical journalist for twenty years, and is the host of the Dr. Dean Edell
Show, which
2
is broadcast on more than 300 radio stations. Dr. Edell has received numerous
awards for his broadcasting work, including a C. Everett Koop Media award, an
Edward R. Murrow award, and awards from the American Cancer Society and the
American Heart Association. Dr. Edell received a B.A. in Zoology from Cornell
University and an M.D. from Cornell University Medical School.
Albert L. Greene has served as a director since October 1998 and as
chairman of the board of directors since November 2000. From July 1998 to
February 2001, Mr. Greene served as Chief Executive Officer of
HealthCentral.com, and he served as President from July 1998 to November 2000.
From May 1990 to February 1998, Mr Greene served as President of Alta Bates
Medical Center, a hospital in Berkeley, California. From January 1996 to July
1998, Mr. Greene served as Chief Executive Officer of the East Bay Service
Area of Sutter Health, a healthcare provider. He also serves on the boards of
directors of Quadramed Corporation, a developer of healthcare software and
services, Lumisys Incorporated, a supplier of medical imaging products, and
Acuson Corporation, a manufacturer of medical ultrasound equipment. Mr. Greene
received a B.A. in Psychology from Ithaca College and an M.H.A. in Hospital
Administration from the University of Michigan.
James J. Hornthal co-founded HealthCentral.com in August 1996, has been a
director since inception and served as co-chairman of the Board of Directors
from September 1999 to November 2000. In March 1985, Mr. Hornthal founded
Preview Travel, an online travel services company. He served as chairman of
the Board of Directors of Preview Travel from its inception until Preview
Travel merged with Travelocity.com in March 2000, as well as Preview Travel's
President until April 1994 and Chief Executive Officer until June 1997. Mr.
Hornthal currently serves as the Vice Chairman of Travelocity's Board of
Directors. Mr. Hornthal is also the chairman of the board of CNX Media, a
privately-held media convergence company. Mr. Hornthal received an A.B. in
Economics from Princeton University and an M.B.A. from Harvard Business
School, where he was a Baker Scholar.
Michael D McDonald has served as a director since August 1999, when we
acquired Enterprise Web Services. He served as co-chairman of our board of
directors from September 1999 to November 2000 and served as chairman of the
board of directors from August 1999 to September 1999. Since December 1995, he
has served as President and a director at both Global Health Initiatives, a
health information company, and Health Initiatives Foundation, Inc., a health
and technology non-profit company. At Enterprise Web Services, Dr. McDonald
served as President and chairman of the board of directors from June 1984 to
August 1999. He also served as Director of Health and Telecom at the Koop
Foundation from March 1995 to April 1997. Dr. McDonald received a B.A. in
Interdisciplinary Study of Medicine from the University of California, San
Diego, and an M.P.H. and Dr. P.H. from the University of California, Berkeley.
Miles K. Munger has been a director since April 2001 and has served as our
Vice President and General Manager of Merchandising and Marketing since
November 2000. From January 2000 to November 2000, he served as Vice President
and General Manager of Merchandising, and from November 1999 to January 2000
he served as a consultant to HealthCentral.com. From April 1997 to October
1999, Mr. Munger was Vice President of Merchandising for West Marine Products,
a marine retailer. From January 1995 to April 1997, Mr. Munger served as
Director of Product Procurement at The North Face, a sporting goods retailer
and wholesaler. Mr. Munger received a B.S. in Business Administration from
Portland State University.
There are no family relationships among any of the directors or executive
officers of the Company.
Compliance with Section 16(a) of the Securities Exchange Act
Section 16(a) of the Securities Exchange Act of 1934 requires our
directors, our executive officers and persons who own more than 10% of the
common stock (collectively, "Reporting Persons") to file initial reports of
ownership and changes in ownership of our common stock. Reporting Persons are
required by SEC regulations to furnish us with copies of all Section 16(a)
reports they file. To our knowledge, based solely on our review of the copies
of such reports received or written representations from certain Reporting
Persons that no other reports were required, we believe that during the year
ended December 31, 2000 all Reporting Persons complied with all applicable
filling requirements.
3
Item 11. Executive Compensation
The following table shows the compensation paid during each of the last
three years to (a) the person who served as our Chief Executive Officer during
2000, (b) our four other most highly compensated individuals who were serving
as executive officers on December 31, 2000, and (c) an additional individual
who would have been included in the four most highly compensated individuals,
except that he was not serving as an executive officer on December 31, 2000
(the "Named Executive Officers").
SUMMARY COMPENSATION TABLE
Long-Term
Compensation Award
---------------------------
Annual Compensation Restricted Securities
---------------------- Stock Underlying
Name Year Salary ($) Bonus ($) Award(s) ($)(1) Options (#)
---- ---- ---------- --------- --------------- -----------
Albert Greene........... 2000 235,000 70,750 -- 670,000(3)
Chief Executive Officer 1999 185,008(2) 95,003 -- 498,582(4)
1998 64,800(2) -- -- 149,718
C. Fred Toney........... 2000 214,375 25,000 -- 672,000(3)
President, Chief 1999 94,744 43,750 -- 312,500
Operating Officer and
Chief Financial Officer
Frank Babbitt........... 2000 157,093(6) 18,278 -- 75,000(3)
Vice President of 1999 31,667 20,000 -- 27,000(4)
Consumer Internet
Development(5)
Peter Morris............ 2000 128,846(6) 33,000 -- 120,000(3)
Vice President and
General Manager of
Business Development(5)
Neil Sandow............. 2000 150,500 -- -- 31,500(3)
Vice President of Drug 1999 26,154 -- -- 37,500(4)
Information Services
Robert Cudd............. 2000 132,848(6) 37,500 -- 75,000
Senior Vice President 1999 24,333 7,500 -- 156,249
of Marketing(7)
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(1) As of December 31, 2000, the named executive officers held restricted
stock in the following aggregate numbers. Because the market price on
December 29, 2000 was less than consideration paid in each case, the
valuation of shares, in each case, was zero.
. Mr. Greene held 45,522 shares directly and 62,500 shares indirectly
through a limited partnership.
. Mr. Toney held 61,153 shares.
. Mr. Babbitt held 25,958 shares.
. Mr. Morris held 5,597 shares.
. Mr. Sandow held 405,675 shares.
. Mr. Cudd held 11,486 shares.
(2) Includes amounts that were paid to Mr. Greene as a consultant for a
portion of the year.
(3) Includes options initially granted during 2000 and repriced on December
11, 2000.
(4) Includes options initially granted during 1999 and repriced on December
11, 2000.
(5) Mr. Morris ceased employment with the Company on January 31, 2001.
(6) Includes amounts deferred under the Company's 401(K) plan.
(7) Mr Cudd ceased employment with the Company on November 29, 2000.
On February 23, 2001, Albert Greene resigned as our Chief Executive
Officer. His employment agreement, as amended, provides for severance payments
of approximately $25,000 per month for 12 months, subject to Mr. Greene's
continued compliance with certain provisions. We are currently negotiating an
amendment to this agreement.
4
In December 2000, we entered into a Severance and Change of Control
Agreement with C. Fred Toney, which provides that if we or our successor
terminates him for any reason other than cause, he shall be entitled to
receive severance payments equal to his monthly salary plus a pro rata share
of his bonus for nine months after his termination. In addition, in the event
of a change of control fifty percent (50%) of Mr. Toney's options that are
unvested as of the date of the change of control shall immediately become
vested and the remaining unvested shares shall vest at the rate of 1/12th each
month, unless he is terminated within 12 months after the change of control
without cause, in which case all remaining unvested options shall vest.
On November 14, 2000, we repurchased 312,500 shares of common stock from
Mr. Toney at $1.38 per share, which repurchase price was paid by cancellation
of principal of $400,000 and accrued interest of $32,542.23 pursuant to two
promissory notes executed by Mr. Toney.
In the event of certain change of control transactions and subject to
certain conditions, 50% of the unvested options held by each of our executive
officers shall vest and then 1/12th of the remaining unvested shares shall
vest monthly, subject to the continued provision of services. In addition, if
the optionee is terminated, including constructive termination, within 12
months of the change of control transaction all of the remaining unvested
shares shall vest immediately.
Mr. Toney was promoted to Chief Executive Officer on February 23, 2001. His
salary and bonus has not been increased in connection with this promotion.
Option Grants
The following table provides information with respect to stock options
granted to the Named Executive Officers during 2000. We have not granted any
stock appreciation rights. In addition, as required by SEC rules, the table
sets forth the hypothetical gains that would exist for the options based on
assumed rates of annual compound stock price appreciation during the option
term.
OPTION GRANTS IN 2000
Potential
Realizable Value
at Assumed
% of Total Annual Rate of
Number of Options Stock Price
Securities Granted to Appreciation for
Underlying Employees Exercise Option Term(4)
Option in Fiscal Price Expiration ----------------
Name Granted Year(1) ($/Share)(2) Date(3) 5% 10%
---- ---------- ---------- ------------ ---------- ------- --------
Albert Greene.. 450,000(5) 11.32% $0.4062 8/17/10 $44,205 $112,024
220,000(6) 5.53% $0.4062 11/29/10 $21,611 $ 54,767
44,643(7) 1.25% $0.4062 10/7/09 $ 4,385 $ 11,113
C. Fred Toney.. 225,000(5) 5.66% $0.4062 8/17/10 $22,105 $ 56,012
447,000(6) 11.24% $0.4062 11/29/10 $43,910 $ 11,277
Frank Babbitt.. 10,000(6) 0.25% $0.4062 1/31/10 $ 982 $ 2,489
17,000 0.43% $0.4062 11/29/10 $ 1,670 $ 4,232
25,000(7) 0.62% $0.4062 9/3/09 $ 2,456 $ 6,223
Peter Morris... 80,000(6) 2.01% $0.4062 1/14/10 $ 7,859 $ 19,915
20,000(6) 0.50% $0.4062 9/1/10 $ 1,965 $ 4,979
20,000 0.50% $0.4062 11/29/10 $ 1,965 $ 4,979
Neil Sandow.... 20,000(6) 0.50% $0.4062 10/6/10 $ 1,965 $ 4,979
11,500 0.29% $0.4062 11/29/10 $ 1,130 $ 2,863
37,500(7) 0.94% $0.4062 10/28/09 $ 3,684 $ 9,335
Robert Cudd.... 75,000(8) 1.89% $ 3.50 9/14/10 $ 7,367 $ 18,671
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(1) We granted stock options representing 3,970,540 shares to employees in
2000. All grants were made under the 1999 Stock Plan.
(2) In general, the exercise price may be paid in cash, in shares of common
stock valued at fair market value on the exercise date or through a
cashless exercise procedure involving a same-day sale of the purchased
shares.
5
(3) Unless otherwise noted, 1/36th of the total shares vest on each monthly
anniversary of the vesting commencement date. All options have a ten year
term, but are subject to earlier termination in connection with the
termination of employment.
(4) The potential realizable value illustrates value that might be realized
upon exercise of the options immediately prior to the expiration of their
terms, assuming the specified compounded rates of appreciation of the
exercise price per share from the date of grant to the end of the option
term assuming the exercise price is equal to $0.1562, the market price on
December 29, 2001. Actual gains, if any, on stock option exercise are
dependent upon a number of factors, including the future performance of
the common stock and the timing of option exercises, as well as the
optionees' continued employment throughout the vesting period. There can
be no assurance that the amounts reflected in this table will be achieved.
(5) Options initially granted during 2000 and repriced on December 11, 2000.
The board of directors eliminated all performance vesting criteria.
(6) Options initially granted during 2000 and repriced on December 11, 2000.
(7) Options initially granted prior to 2000 and repriced on December 11, 2000.
(8) 1/4th of the total shares vest on the annual anniversary of September 14,
2001, and 1/48th of the total shares vests on the monthly anniversary of
the vesting commencement date thereafter. Vesting ceased on November 15,
2000, the date Mr. Cudd ceased employment with the Company.
AGGREGATED OPTION EXERCISES IN 2000
AND DECEMBER 31, 2000 YEAR-END OPTION VALUES
The following table provides certain information with respect to stock
options exercised by the Named Executive Officers during 2000. None of the
Company's options were considered "in-the-money" as of December 31, 2000
because the exercise price of each option exceeded the December 31, 2000 fair
market value of our common stock of $0.1562. No stock appreciation rights
(SARs) were outstanding during 2000.
Number of Securities
Underlying Unexercised
Options at
Shares December 31, 2000
Acquired On Value -------------------------
Name Exercise Realized Exercisable Unexercisable
---- ----------- -------- ----------- -------------
Albert Greene.................. -- -- 647,425 694,791
C. Fred Toney.................. -- -- 18,667 653,333
Frank Babbitt.................. 23,958 $60,674(1) 33,736 68,264
Peter Morris................... -- -- 556 119,444
Neil Sandow.................... -- -- 1,915 67,085
Robert Cudd.................... -- -- 41,663 189,586
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(1) Value realized is calculated based on the closing price of the Company's
common stock as reported on the Nasdaq on the date of exercise ($3.8125 on
April 24, 2000) minus the exercise price of the option ($1.28 per share)
and does not necessarily indicate that the optionee sold such stock.
Board Compensation
Except for reimbursement for a percentage of travel expenses relating to
attendance at board meetings and the grant of stock options, our directors do
not receive compensation for their services as members of the Board of
directors. Employee directors are eligible to participate in our 1998 Stock
Plan, 1999 Stock Plan and 1999 Employee Stock Purchase Plan. Nonemployee
directors are eligible to participate in our 1998 Stock Plan, 1999 Stock Plan
and Directors' Plan.
The 1999 Directors' Stock Option Plan (the "Directors' Plan") provides that
each person who first becomes a nonemployee director after our initial public
offering will be automatically granted a nonstatutory stock option
6
to purchase 12,500 shares of common stock on the date on which he or she first
becomes a member of our board of directors. In addition, on the date of each
annual stockholders meeting, each nonemployee director who will continue
serving on the board following the meeting and who has been a director for at
least six months prior to the meeting date will be granted an option to
purchase 6,250 shares of common stock. All options granted under the
Directors' Plan will have a term of ten years and an exercise price equal to
the fair market value of the common stock on the date of grant. All options
granted under the Directors' Plan to new nonemployee directors shall vest
monthly over four years from the date of a grant, and all options granted at
the time of our annual stockholders meeting will vest monthly over 12 months.
In June 2000, under the Directors' Plan each of Dr. Edell, Mr. Hornthal and
Dr. McDonald was automatically granted a nonstatutory stock option to purchase
6,250 shares of our common stock at an exercise price of $3.9375 per share.
Each of these option grants vests over a 12 month period. On the date of the
Annual Meeting, under the Directors' Plan each of Dr. Edell, Mr. Hornthal and
Dr. McDonald will be automatically granted a nonstatutory stock option to
purchase 6,250 shares of our common stock at an exercise price equal to the
fair market value of the shares on the date of grant. Each of these option
grants will vest over a 12 month period.
See "Item 11. Executive Compensation" for a description of compensation to
Messrs. Greene and Toney.
7
Item 12. Common Stock Ownership of Certain Beneficial Owners and Management
The following table shows how many shares of common stock were owned by
each of our directors, the executive officers named in the Summary
Compensation Table of this proxy ("Named Executive Officers"), all officers
and directors as a group, and each owner of more than 5% of our outstanding
common stock, as of February 28, 2001. The applicable percentage of ownership
for each stockholder is based on 50,661,038 shares of common stock outstanding
as of February 28, 2001, in each case together with applicable options for
that stockholder. Shares of common stock issuable upon exercise of options and
other rights beneficially owned that are exercisable on or before April 29,
2001 are deemed outstanding for the purpose of computing the percentage
ownership of the person holding those options and other rights but are not
deemed outstanding for computing the percentage ownership of any other person.
Beneficial ownership calculations for 5% stockholders are based solely on
publicly filed Schedule 13D's or 13G's, which 5% stockholders are required to
file with the SEC, and which generally set forth ownership interests as of
December 31, 2000. Except as otherwise noted, the address of each person
listed in the table is c/o HealthCentral.com, 6005 Shellmound Street, Suite
250, Emeryville, CA 94608. Beneficial ownership is determined in accordance
with the rules of the Securities and Exchange Commission and is based on the
individual's ability to exercise voting and investment power with respect to
shares. To our knowledge, except under applicable community property laws or
as otherwise indicated, the persons named in the table have sole voting and
sole investment control with respect to all shares beneficially owned.
Total Number Beneficially
Name and Address of Shares Owned
---------------- ------------ ------------
more.com, Inc........................................ 5,002,525 9.87%
c/o Morrison & Foerster LLP
425 Market Street
San Francisco, CA 94105
Jefferson Chase, LLC(1).............................. 3,110,941 6.14%
Robert Haft, Manager
c/o Venable, Baetjer, Howard & Civiletti, LLP
1201 New York Avenue NW
Washington, DC 20005
Clairvest Vitamins................................... 3,208,786 6.33%
Attn: Jeff Par, Suite 1700
22 St. Clair Avenue East
Toronto Ontario M4T 2S3
Canada
Acacia Venture Partners(2)........................... 2,641,275 5.21%
101 California Street, Suite 3160
San Francisco, CA 94011
James J. Hornthal(3)................................. 2,406,215 4.53%
Dean S. Edell(4)..................................... 2,310,208 4.36%
Michael D. McDonald(5)............................... 1,655,101 3.16%
Albert L. Greene(6).................................. 751,381 1.46%
C. Fred Toney(7)..................................... 154,486 *
Neil Sandow(8)....................................... 417,718 *
Robert Cudd(9)....................................... 53,149 *
Frank Babbitt(10).................................... 38,221 *
Peter Morris(11)..................................... 6,708 *
All directors and executive officers as a group (10
persons)(12)........................................ 8,061,248 15.92%
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* Less than 1%.
(1) Reflects 400,000 share gift made subsequent to the filing of Amended
Schedule 13D on January 30, 2001. Mr. Haft is a former director and
officer of the Company.
8
(2) Consists of 2,455,902 shares held by Acacia Venture Partners II, LP and
185,373 shares held by South Pointe Venture Partners II, LP.
(3) Consists of 2,401,007 shares held by an investment entity and trust
controlled by Mr. Hornthal and 5,208 shares issuable pursuant to the
exercise of vested options as of April 29, 2001.
(4) Includes 5,208 shares issuable pursuant to the exercise of vested options
as of April 29, 2001.
(5) Includes 31,250 shares issuable pursuant to the exercise of vested options
as of April 29, 2001.
(6) Includes 643,359 shares issuable pursuant to the exercise of vested
options as of April 29, 2001.
(7) Includes 93,333 shares issuable pursuant to the exercise of vested options
as of April 29, 2001.
(8) Includes 9,583 shares issuable pursuant to the exercise of vested options
as of April 29, 2001.
(9) Includes 41,663 shares issuable pursuant to the exercise of vested options
as of April 29, 2001.
(10) Includes 25,958 shares issuable pursuant to the exercise of vested
options as of April 29, 2001.
(11) Includes 5,597 shares issuable pursuant to the exercise of vested options
as of April 29, 2001.
(12) Includes 915,674 shares issuable pursuant to the exercise of vested
options as of April 29, 2001 held by directors, Named Executive Officers
and other executive officers.
Item 13. Certain Relationships and Related Transactions
Employment Agreements
An August 15, 2000 offer letter to James Schanzenbach, one of our executive
officers, provides that should Mr. Schanzenbach's employment be terminated
without cause he will be eligible for continued payment of his monthly salary
for six months as severance.
Henry Loubet, one of our executive officers, ceased employment with us on
January 31, 2001. Mr. Loubet's offer letter provides for continued payment of
his base salary for six months as severance (approximately $13,750.00 per
month). We are in the process of negotiating an amendment to this severance
provision.
Also, please see "Executive Compensation" section for description of the
Company's Employment Agreements with Named Executive Officers Albert L. Greene
and C. Fred Toney.
Promissory Notes
On November 14, 2000, we repurchased 312,500 shares of common stock from
Mr. Toney at $1.38 per share, which repurchase price was paid by cancellation
of principal of $400,000 and accrued interest of $32,542.23 owed pursuant to
two promissory notes executed by Mr. Toney.
Contracts with Affiliates
In April 2000, we paid Dr. Edell, one of our co-founders and directors,
approximately $1.4 million in cash for an assignment of the "Dr. Dean Edell"
brand name for our use in connection with the marketing, sale and distribution
of prescription and non-prescription eyewear through December 31, 2006. For
the year ended December 31, 2000, we derived $5.0 million in revenue from the
sale of Dr. Dean Edell eyewear.
We believe that all of our transactions with affiliates were entered into
on terms and conditions no less favorable to us than those that could have
been obtained from unaffiliated third parties. In addition, our policy is that
all transactions with our affiliates are approved by a majority of our board
of directors, including a majority of our independent and disinterested
directors.
9
Item 14. Exhibits
Number Description
------ -----------
2.1 Asset Purchase Agreement dated July 24, 2000 by and among
Healthcentral.com, HCC subsidiary Corp., DrugEmporium.com, Inc. and
Drug Emporium, Inc. (as amended on September 11, 2000) (Filed as
Exhibits 2.1 and 2.2 to the Company's Current Report on Form 8-K
filed on September 28, 2000 and herein incorporated by reference.)
2.2 Asset Purchase Agreement dated October 23, 2000, by and among
HealthCentral.com, HCEN Acquisition Corporation, more.com, Inc. and
Comfort Living, Inc. (as amended on November 14, 2000 and November
27, 2000) (Filed as Exhibits 2.5, 2.6 and 2.7 to the Company's
Current Report on Form 8-K, filed on December 21, 2000 and herein
incorporated by reference.)
2.3 Agreement and Plan or Reorganization and Merger among
HealthCentral.com, HCC Acquisition Corp. and Vitamins.com, Inc.,
dated as of March 15, 2000 (Filed as Exhibit 2.1 to the Company's
Current Report on Form 8-K, filed on June 19, 2000, and herein
incorporated by reference.)
3.3(1) Amended and Restated Certificate of Incorporation of the Company
3.5(5) Amended and Restated Bylaws of the Company
3.8(5) Certificate of Designation of Series A preferred Stock of
HealthCentral.com dated September 7, 2000
4.1(1) Form of Company's Common Stock Certificate
4.2(3) Registration Rights Agreement between the Company and Alta Vista
Company dated August 2, 2000
4.3(5) Registration Rights Agreement between the Company and Don Bayless
dated December 2, 2000
4.4(5) Registration Rights Agreement between the Company and Goldberg,
Marchesano Partners, Inc. dated December 22, 2000
10.1(1) First Amended and Restated Investors' Rights Agreement dated August
27, 1999 between the Company and certain investors
10.2(2) 1999 Stock Plan, as amended on January 2000, and form of stock option
agreements and restricted stock purchase agreements
10.3(2) Amended and Restated 1998 Stock Plan, as amended on January 2000, and
form of stock option agreements and restricted stock purchase
agreements
10.4(1) 1999 Employee Stock Purchase Plan, and form of subscription agreement
10.5(1) 1999 Directors' Stock Option Plan, and form of stock option agreement
10.6(1) Form of Common Stock Agreement between the Company and each of Dean
S. Edell M.D. and James J. Hornthal
10.9(1) Employment Agreement between the Company and Deryk Van Brunt
10.10(3) Employment Agreement between the Company and Albert Greene, dated
August 16, 1999, as amended June 27, 2000
10.11(1) Offer Letter from the Company to C. Fred Toney dated June 16, 1999
10.15(1) License and Confidential Information Agreement between the Company
and Dr. Dean S. Edell dated May 14, 1999
10.16(1) Office Lease between the Company and Christie Avenue Partners JS
dated March 26, 1999
10
Number Description
------ -----------
10.17(1) Landlord's Consent and Agreement (Sublease) between the Company and
Burnham Pacific Operating Partnership, L.P. dated July 22, 1999
10.19(1)+ Co-Branded Site Agreement by and between the Company, Graedon
Enterprises, Inc., and Joe Graedon and Teresa Graedon dated
September 9, 1999
10.21(1) Agreement and Plan of Reorganization by and between the Company, HC
Acquisition Corporation and ePills, Inc. dated September 28, 1999
10.24(1) Form of Indemnification Agreement
10.25(1) Agreement and Plan of Reorganization by and between the Company and
RxList.com dated October 25, 1999
10.26(1) Industrial Lease between ePills.com and H.S.P. dated May 4, 1999
10.27(1)+ Co-Branding Content Agreement between the Company and MediaLinx
Interactive, L.P. dated June 30, 1999
10.29(1) Assumed HealthCentralRx.com 1999 Stock Option Plan and form of
incentive stock option agreement
10.30(2) Agreement with Covert Bailey dated December 1999
10.31(4) Employment Agreement between the Company and Robert M. Haft, dated
March 15, 2000 and effective as of June 16, 2000
10.32(4) Assignment and Amendment Agreement among the Company, Brand Optical
Corporation and Dr. Dean Edell, dated April 11, 2000
10.33(5) Industrial Lease Agreement between Telestar Court Limited
Partnership and Vitamins Superstore, L.L.C. dated June 19, 1997
10.34(5) Industrial Lease Agreement between Drug Emporium, Inc. and Crow
Family Holdings Industrial Limited Partnership dated July 15, 1999
10.35(5) Office Lease between the Company and Christie Avenue Partners JS
dated May 19, 2000 (as amended June 5, 2000)
10.36(5) Offer Letter from the Company to James Schanzenbach dated August 15,
2000
10.37(5) Assignment Agreement between Drug Emporium, Inc. and
DrugEmporium.com, Inc., dated February 29, 2000
10.38(5) Assignment Agreement between the Company and DrugEmporium.com, Inc.,
dated August 30, 2000
10.39(5) Common Stock Repurchase Agreement between the Company and C. Fred
Toney dated November 13, 2000
10.40(5) Amendment I to Industrial Lease Agreement between the Company and
Crow Family Holdings Industrial Limited Partnership, dated November
27, 2000
10.41(5) Severance and Change of Control Agreement between the Company and C.
Fred Toney dated December 2000
21.1(5) List of subsidiaries
23.1 Consent of Independent Accountants, PricewaterhouseCoopers LLP
23.2 Consent of Independent Accountants, Arthur Andersen LLP
24.1(5) Power of Attorney
11
- --------
+ Confidential treatment has been granted by the Securities and Exchange
Commission
++ Supersedes previously filed exhibit
(1) Filed with the Company's Registration Statement on Form S-1 (Commission
File No. 333-88019) and herein incorporated by reference
(2) Filed with the Annual Report on Form 10-K for the year ended December 31,
1999, filed on March 10, 2000 and herein incorporated by reference
(3) Filed with the Quarterly Report on Form 10-Q for the quarter ended June
30, 2000, filed on August 14, 2000 and herein incorporated by reference
(4) Filed with the Quarterly Report on Form 10-Q for the quarter ended
September 30, 2000, filed on November 14, 2000 and herein incorporated by
reference
(5) Filed with the Annual Report on Form 10-K for the year ended December 31,
2000, filed on April 2, 2001 and herein incorporated by reference
12
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
Healthcentral.com
/s/ C. Fred Toney
By: ________________________________
C. Fred Toney
Chief Executive Officer,
Chief Financial Officer and
Director
Date: April 30, 2001
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ C. Fred Toney Chief Executive Officer, April 30, 2001
____________________________________ Chief Financial Officer and
C. Fred Toney Director
/s/ Dean Edell* Director April 30, 2001
____________________________________
Dean Edell
/s/ Albert L. Greene* Chairman of the Board of April 30, 2001
____________________________________ Directors
Albert L. Greene
/s/ James Hornthal* Director April 30, 2001
____________________________________
James Hornthal
/s/ Michael D. McDonald* Director April 30, 2001
____________________________________
Michael D. McDonald
/s/ Miles Munger* Director and Vice President April 30, 2001
____________________________________ and General Manager of
Miles Munger Merchandising and Marketing
/s/ C. Fred Toney
*By: _______________________________
Power of Attorney
13