U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
AMENDMENT NO. 2
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 15, 2000
INVESTAMERICA, INC.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEVADA 000-28303 87-0400797
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(STATE OR OTHER JURISDICTION OF (COMMISSION (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) FILE NUMBER) IDENTIFICATION NO.)
1776 Park Avenue, Park City, Utah 84060
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 435-615-8801
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ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
On November 22, 1999, the Company entered into an Agreement (the
"Acquisition Agreement") with Optica Communications International Inc.
(f/k/a Oakbay Trading Limited), a British Virgin Islands corporation
("Optica"), and the shareholders of Optica pursuant to which the Company
acquired all of the issued and outstanding stock of Optica (the "Optica
Acquisition"). The shares of Optica were acquired in consideration for
450,000 shares of the Company's Series A Convertible Preferred Stock, par
value $.001 per share (the "Series A Preferred Stock"). The transaction
was consummated on March 15, 2000, but had an effective date as of November
24, 1999. Optica is the sole stockholder of Optica Communications, Inc. a
British Columbia corporation ("Optica Canada"), and Optica Communications,
Inc., a Nevada corporation ("Optica USA"). Optica Canada and Optica USA are
start-up companies that are endeavoring to become a leading supplier of
managed dark fiber and innovative band-with services on a global basis. As
a result of the Optica Acquisition, Optica is a wholly-owned subsidiary of
the Company. As described below, the former stockholders of Optica have
acquired control of the Company through the issuance to them of Series A
Preferred Stock, that is convertible into Common Stock of the Company.
Each share of Series A Preferred Stock is currently convertible into
185 shares of Common Stock. Therefore, an aggregate of 83,250,000 shares
of Common Stock are issuable upon the conversion of all of the Series A
Preferred Stock. In addition, each share of Series A Preferred Stock
currently has 185 votes (an aggregate of 83,250,000 votes for all of the
outstanding Series A Preferred Stock), voting together with the holders
of Common Stock as a single class. Based on the 30,522,703 shares of
Common Stock currently issued and outstanding, the holders of Series A
Preferred Stock would own approximately 73% of the Company's outstanding
Common Stock upon conversion of the Series A Preferred Stock (without
giving effect to any currently outstanding options). Therefore, the
issuance of the Series A Preferred Stock resulted in a change in control
of the Company.
The Company currently has 50,000,000 shares of Common Stock authorized for
issuance of which 30,522,703 shares are issued and outstanding. Based on
the number of shares of Common Stock that are issuable upon conversion of
the Series A Preferred Stock, the Company does not have a sufficient number
of authorized common shares available. The Board of Directors of the Company
has approved an amendment to the Company's Articles of Incorporation to
increase the number of authorized common shares from 50,000,000 to
200,000,000. Such amendment is subject to approval by the shareholders of
the Company. Therefore, the Company will call a Special Meeting of
Shareholders in the near future to consider and vote upon the amendment.
On October 21, 1999, in contemplation of entering into the Acquisition
Agreement, Douglas Smith, the President of Optica was named Chairman,
President (CEO) and a director of the Company. Immediately prior to that
time, Brian Kitts was the sole officer and director of the Company and a
principal stockholder (owning 2,012,500 shares of Common Stock -
approximately 21% of the Company's issued and outstanding voting stock).
Brian Kitts resigned as President of the Company and retained his position
as Secretary of the Company. Under the Acquisition Agreement, the
stockholders of Optica were given the right, at any time following the
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closing, to designate up to four directors of the Company for so long as
they collectively own or have the right to acquire at least 50% of the
issued and outstanding shares of Common Stock. The Acquisition Agreement
also provides that Brian Kitts will remain a director for at least one
year from the date of the closing of the transaction. On November 24,
1999, two additional directors, Ernst Gemassmer and Fred F. Fierling,
were named to the Board as designees of the Optica shareholders, although
neither of them is affiliated with any of the Optica shareholders or
directors.
The former stockholders of Optica, who now have voting control of
the Company, are comprised of four corporations, Russells Systems Limited,
Crystsal Marriott S.A., Winjoy Services Centre Limited and Virgil
Securities S.A. Douglas Smith, Chairman and President (CEO) of the
Company, is one of the beneficiaries of a trust that is the sole
stockholder of Virgil Securities S.A.
The following table sets forth stock ownership information as of
March 15, 2000 concerning (i) each director and persons nominated to
become directors of The Company, (ii) each person (including any "group"
as defined in Section 13(d)(3) of the Securities Exchange Act of 1934)
who is known by the Company to beneficially own more than five (5%)
percent of the outstanding shares of the Company's Common Stock and
Series A Preferred Stock, (iii) the Chief Executive Officer and the
other executive officers of the Company, and (iv) The Company's
executive officers and directors as a group. As indicated in footnotes
to the table, pro forma effect is given to the conversion in full of the
Series A Preferred Stock at the rate of 185 shares of Common Stock for
each share of Series A Preferred Stock.
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Amount and
Nature of
Name and Address Position with Beneficial Percentage
of Beneficial Owners the Company Ownership(1) of Class(1)
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Russells Systems Limited(2)
Suite 61, Grosvenor Close
Shirley Street
Nassau, New Providence,
Bahamas Shareholder 54,040,180 63.9%
Crystsal Marriott S.A.(3)
Suite 61, Grosvenor Close
Shirley Street
Nassau, New Providence,
Bahamas Shareholder 7,604,980 19.9%
Winjoy Services Centre Limited (4)
Suite 61, Grosvenor Close
Shirley Street
Nassau, New Providence,
Bahamas Shareholder 7,604,980 19.9%
Virgil Securities S.A.(5)
Suite 61, Grosvenor Close
Shirley Street
Nassau, New Providence,
Bahamas Shareholder 10,499,860 25.6%
Montreau Investments Ltd.
PO Box 1062
One Capital Place
Georgetown, Grand Caymon
Brisitsh West Indies Shareholder 3,500,000 10.3%
Douglas Smith(6) Chairman,
President
(CEO) and
Director 560,000 1.8%
Brian Kitts(7)
1776 Park Ave. #4
PO Box 770 Secretary
Park City, Utah 84060 Treasurer,
and Director 2,362,500 7.6%
Ernst Gemassmer(8) Director 145,000 0.5%
Fred F. Fierling(9) Director 145,000 0.5%
Daniel Tepper(10)
1350 East Flamingo Road, #52
Las Vegas, Nevada 89119 Shareholder 4,916,250 16.1%
All officers and directors as
a group of 4 persons (11) 3,212,500 10.1%
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(1) A person is deemed to be the beneficial owner of securities that
can be acquired by such person within 60 days from March 15, 2000
upon the exercise of options. Each beneficial owner's percentage
ownership is determined by assuming that options and/or Series A
Preferred Stock that are held by such person (but not those held
by any other person) and which are exercisable or convertible
within 60 days from March 15, 2000 have been exercised or converted,
as the case may be.
(2) Comprised of shares issuable upon conversion of 311,028 shares of
Series A Preferred Stock. Russells Systems Limited is a Bahamas
company whose sole stockholder is a trust.
(3) Comprised of shares issuable upon conversion of 41,108 shares of
Series A Preferred Stock. Crystsal Marriott S.A. is a Bahamas
company whose sole stockholder is a trust.
(4) Comprised of shares issuable upon conversion of 41,108 shares of
Series A Preferred Stock. Winjoy Services Centre Limited is a
Bahamas company whose sole stockholder is a trust.
(5) Comprised of shares issuable upon conversion of 56,756 shares of
Series A Preferred Stock. Virgil Securities S.A. is a Bahamas
company whose sole stockholder is a trust. Douglas Smith is a
beneficiary of the trust but Mr. Smith is not a trustee, does not
have the right to vote the shares or dispose of the shares, or to
terminate the trust. Mr. Smith disclaims beneficial ownership of
the shares. Does not include shares issuable to Mr. Smith upon
the exercise of options disclosed in footnote 6 below.
(6) Comprised of shares that Mr. Smith may acquire pursuant to stock
options that are currently exercisable or exercisable within 60
days. Mr. Smith was granted options to purchase an aggregate of
2,800,000 shares, which vest at the rate of 112,000 shares per month
commencing December 24, 1999. Does not include shares owned by Virgil
Securities S.A., beneficial ownership of which is disclaimed by Mr.
Smith. (See footnote 5 above).
(7) Includes 350,000 shares that Mr. Kitts may acquire pursuant to stock
options that are currently exercisable or exercisable within 60 days.
Mr. Kitts was granted options to purchase an aggregate of 1,750,000
shares, which vest at the rate of 70,000 shares per month commencing
December 24, 1999.
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(8) Comprised of shares that Mr. Gemassmer may acquire pursuant to stock
options that are currently exercisable or exercisable within 60 days.
Mr. Gemassmer was granted options to purchase an aggregate of 725,000
shares, which vest at the rate of 29,000 shares per month commencing
December 24, 1999.
(9 ) Comprised of shares that Mr. Fierling may acquire pursuant to stock
options that are currently exercisable or exercisable within 60 days.
Mr. Fierling was granted options to purchase an aggregate of 700,000
shares, which vest at the rate of 29,000 shares per month commencing
December 24, 1999.
(10) Based solely on information set forth in the Company's records that has
not been verified by Mr. Tepper. Under the terms of a Settlement
Agreement and Release between Mr. Tepper, Mr. Kitts and the Company, Mr.
Tepper is obligated to vote all of his shares for management nominees to
the Company's Board of Directors and on all other matters in the same
proportion as the votes cast by the shareholders of the Company.
(11) Includes 1,200,000 shares that directors and officers may acquire
pursuant to stock options that are currently exercisable or exercisable
within 60 days. Does not include shares beneficially owned by Virgil
Securities S.A. (See footnote 5 above).
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On March 15, 2000, the Company fully consummated the acquisition of Optica
in accordance with the Acquisition Agreement described in Item 1 above. The
Company acquired all of the issued and outstanding shares of Optica in
consideration for 450,000 shares of the Company's Series A Preferred Stock.
The Series A Preferred Stock is convertible into an aggregate of 83,250,000
shares of Common Stock. The transaction was consummated on March 15, 2000,
but had an effective date as of November 24, 1999. See Item 1 above for
additional information regarding the transaction.
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ITEM 7. FINANCIAL STATEMENTS, PRO-FORMAS FINANCIAL INFORMATION AND EXHIBITS.
BRAVERMAN & COMPANY
Certified Public Accountants
To: Shareholders and Board of Directors
OAKBAY TRADING LIMITED
We have audited the accompanying balance sheets of Oakbay Trading Limited and
its subsidiary as of September 30, 1999, and the related consolidated
statements of income and cash flows for the year then ended. These financial
statements are the responsibility of Oakbay'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
in the United States. 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 Oakbay Trading Limited and its
subsidiary at September 30, 1999, and the consolidated results of their
operations and cash flows for the year then ended in conformity with generally
accepted accounting principles.
April 4, 2000
Calabasas, California
23679 Calabasas Road # 149, Calabasas CA 91302
F-1
Oakbay Trading Limited and Subsidiary
Consolidated Balance Sheet
September 30, 1999
CONSOLIDATED BALANCE SHEET
Assets
Current Assets:
Due from Stockholder $ 3,670
Other receivable 68
Total Asset's - All Currency $ 3,738
Liabilities and Stockholder's Deficiency
Current Liabilities:
Accounts Payable $ 4,627
Stockholder's Deficiency:
Common Shares, no par value
Authorized Shares 50,000
Outstanding Shares 45,000 $ 3,670
Accumulated Deficit (4,559)
Total Stockholder's Deficiency (889)
Total Liabilities and Stockholders Deficiency $ 3,738
The accompanying notes are an integral part of the financial statements.
F-2
Oakbay Trading Limited and Subsidiary
Statement of Income
For the year Ended September 30, 1999
STATEMENT OF INCOME
Revenue $ 0
Operating Expenses 4,627
Net Income $ (4,627)
The accompanying notes are an integral part of the financial statements.
F-3
Oakbay Trading Limited and Subsidiary
Statement of Cash Flow
For the year Ended September 30, 1999
STATEMENT OF CASH FLOWS
Cash Flows to Operating Activities
Net (Loss) $ (4,559)
Increase in Miscellaneous (3,738)
Increase in Accounts Payable 4,627
Net Cash (Used By) Operating Activities (3,670)
Cash Flow From Financing Activities
Proceeds From Issuance of Common Stock 3,670
Increase (Decrease) in Cash -
Cash Beginning of Year -
Cash End of Year $ -
The accompanying notes are an integral part of the financial statements.
F-4
Oakbay Trading Limited and Subsidiary
Notes to Financial Statements
September 30, 1998
NOTE 1 - ORGANIZATION
The company was organized on April 27, 1998 under the laws of the British Virgin
Islands.
During the year ended September 30, 1998, the Company acquired 100% of the
issued and outstanding stock of Optica communications, Inc., a company
incorporated in British Columbia, Canada.
Principles of Consolidation - The consolidated financial statements include the
accounts of the Company and its wholly - owned subsidiary. All significant
intercompany transactions between the parent and the subsidiary have been
eliminated in the consolidation process.
F-5
BRAVERMAN & COMPANY
Certified Public Accountants
To: Shareholders and Board of Directors
OAKBAY TRADING LIMITED
We have audited the accompanying balance sheets of Oakbay Trading Limited as of
September 30, 1998, and the related statement of income from inception April
27, 1998, to September 30, 1998. These financial statements are the
responsibility of Oakbay'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
in the United States. 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.
n 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 Oakbay Trading Limited at
September 30, 1998 and the results of its operations from inception April 27,
1998, to September 30, 1998, in conformity with generally accepted accounting
principles.
April 4, 2000
Calabasas, California
23679 Calabasas Road # 149, Calabasas CA 91302
F-1
Oakbay Trading Limited
Balance Sheet
September 30, 1998
BALANCE SHEET
Assets None
Liabilities and Stockholder's Equity None
The accompanying notes are an integral part of the financial statements.
F-2
Oakbay Trading Limited
Statement of Income
From Inception April 27, 1998 to September 30, 1998
STATEMENT OF INCOME
Revenue $ None
Expenses None
Net Income $ None
The accompanying notes are an integral part of the financial statements.
F-3
Oakbay Trading Limited
Notes to Financial Statements
September 30, 1998
NOTE 1 - ORGANIZATION
The company was organized on April 27, 1998 under the laws of the British Virgin
Islands.
As of September 30, 1998, the Company had not commenced any operations, acquired
any assets, incurred any debt or issued any stock.
F-4
InvestAmerica, Inc., and Subsidiary and
Optica Communications International, Inc., and Subsidiaries
Pro Forma Balance Sheet
March 15, 2000
PRO FORMA BALANCE SHEET
Optica
Communications
InvestAmercia International Combined
Inc. Limited Eliminations ProForma
Assets
Current Assets:
Cash $ 325,688 $ 814 $ - $ 326,502
Loans Receivable-
Oakbay Trading 4,000,000 - (4,000,000) -
Stocks Subscriptions
Receivable 800,000 - - 800,000
Investment - 5,000,000 - 5,000,000
Total Current Assets 5,125.688 5,000,814 - 6,126,502
Computer Software - 1,100 - 1,100
Total Assets $ 5,125.688 $ 5,001,914 - $ 6,127,602
Liabilities and Stockholders Equity
Current Liabilities:
Accounts Payable $ 1,140 $ 7,476 - $ 8,616
Payroll Taxes Payable - 3,393 - 3,393
Note Payable - 21,020 - 21,020
Loan Payable - 400 - 400
Due on Investment - 1,000,000 - 1,000,000
Advances From
InvestAmerica, Inc. - 4,000,000 4,000,000 -
Loan Payable - Officer 2,000,000 - - 2,000,000
Total Current Liabilities 2,001,140 5,032,289 - 3,033,429
Stockholders Equity
Preferred Shares - - 450 450
Common Shares 31,118 3,670 (3,670) 31,118
Additional Paid-
In Capital 14,500,685 - 3,220 14,503,905
Accumulated Deficit (11,407,255) (34,045) - (11,441,300)
Total Stockholders Equity 3,124,548 (30,375) - 3,094,173
Total Liabilities and
Stockholders Equity $ 5,125,688 $ 5,001,914 - $ 6,127,602
F-1
InvestAmerica, Inc., and Subsidiary and
Optica Communications International, Inc., and Subsidiaries
Pro Forma Statement of Income
March 15, 2000
PRO FORMA STATEMENT OF INCOME
Optica
Communications
InvestAmercia International Combined
Inc. Limited Eliminations ProForma
Revenues $ - $ - $ - $ -
Operating Expense 218,945 27,822 - 246,767
Loss From Operations (218,945) (27,822) - (246,767)
Forgiveness of
Indebtedness 810,206 - - 810,206
Interest Income - 31 - 31
Income Before
Provision for
Federal Income
Taxes 591,261 (27,791) - 563,470
Provision for
Federal
Income Taxes 196,867 - - (196,867)
Tax Benefit From
Net Operating Loss
Carry-Over (196,867) - - (196,867)
Net Income (Loss) $ 591,261 $ (27,991) - $ 563,470
F-2
InvestAmerica, Inc. and Oakbay Trading Limited
Pro Forma Statement of Income
For the Year Ending September 30, 1999
PRO FORMA STATEMENT OF INCOME
Optica
Communications
InvestAmercia International Combined
Inc. Limited Eliminations ProForma
Revenues $ - $ - $ - $ -
Operating Expenses 256,865 4,627 - 261,492
Loss From Operation (256,865) (4,627) - (261,492)
Judgement Against
Company (6,991,348) - - (6,991,348)
Net Loss $(7,248,213) $ (4,627) - $(7,252,840)
F-3
Optica Communications International, Inc.
(Formerly Oakbay Trading Limited) and Subsidiaries
Balance Sheet (Unaudited)
March 31, 2000
BALANCE SHEET
Assets
Current Assets:
Cash $ 814
Investment 5,000,000
Total Current Assets 5,000,814
Computer Software 1,109
Total Assets $ 5,001,923
Liabilities and Stockholder's Deficiency
Current Liabilities:
Accounts Payable $ 7,485
Payroll Taxes Payable 3,393
Note Payable 21,020
Due on Investment 1,000,000
Advances From Shareholders 4,000,000
Loan Payable 400
Stockholder's Deficiency: 5,032,298
Common Shares, no par value
Authorized Shares 50,000
Outstanding Shares 45,000 $ 3,670
Accumulated Deficit (34,045)
Total Stockholder's Deficiency (30,375)
Total Liabilities and Stockholders Deficiency $ 5,001,923
The accompanying notes are an integral part of the financial statements.
F-4
Optica Communications International, Inc.
(Formerly Oakbay Trading Limited) and Subsidiaries
Statement of Income (Unaudited)
March 31, 2000
STATEMENT OF INCOME
Revenue $ 0
Operating Expenses (27,823)
Loss From Operation (27,822)
Interest Income 31
Net Income $ (27,791)
The accompanying notes are an integral part of the financial statements.
F-5
Optica Communications International, Inc.
(Formerly Oakbay Trading Limited) and Subsidiaries
Statement of Cash Flow (Unaudited)
March 31, 2000
STATEMENT OF CASH FLOWS
Cash Flows to Operating Activities
Net (Loss) $ (27,791)
Increase in Accounts Payable 5,301
Increase in Payroll Taxes Payable 3,393
Increase in Notes Payable 21,020
Net Cash Provided by Operations 1,923
Cash Flow (Used In) Investing Activities
Increase In Investment in Stock $ 5,000,000
Expenditures on Software 1,109
Net Cash Used In Investment Activities (5,001,109)
Cash Flows Provided By Financing Activities
Increase In Amount Owed In Stock Investment 4,000,000
Increase In Advances From Stockholder 1,000,000
Net Cash Provided By Financing Activities 5,000,000
Increase (Decrease) in Cash 814
Cash Beginning of Year -
Cash End of Year $ 814
The accompanying notes are an integral part of the financial statements.
F-6
Optica Communications International, Inc.
(Formerly Oakbay Trading Limited) and Subsidiaries
Notes to Financial Statements
March 31, 2000
NOTE 1 - ORGANIZATION
The company was organized on April 27, 1998 under the laws of the British Virgin
Islands.
During the year ended September 30, 1998, the Company acquired !00% pf the
issued and outstanding stock of Optica communications, Inc., a company
incorporated in British Columbia, Canada
Principles of Consolidation - The consolidated financial statements include the
accounts of the Company and its wholly - owned subsidiary. All significant
intercompany transactions between the parent and the subsidiary have been
eliminated in the consolidation process.
NOTE 2 - INVESTMENTS
The Company has invested $5,000,000 for 833,333 Preferred shares of Omnigon
International, Inc. ("Omnigon"). Omnigon, a private company, is constructing
an advanced global network to offer proprietary value added communications
services.
F-7
The following exhibit is filed herewith:
(1) Agreement dated as of November 22, 1999 among the Company, Optica and
the shareholders of Optica.
SIGNATURES
Pursuant to the requirements 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.
INVESTAMERICA, INC.
By: /s/ Douglas Smith
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Douglas Smith, President
Dated: May 31, 2000
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