REGISTRATION NO.333-41896
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549
Amendment #2 to Form SB - 2
Amended Form SB - 2REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
HOWARD LLEWELLYN ARGENTINA GROUP, INC.
(Exact name of registrant as specified in its charter)
Nevada 5499 76-0602961
(State or other jurisdiction of (Primary Standard Industrial (IRS Employer
Incorporation or organization) Classification Code Number) Identification
No.)
21112 123rd Avenue, Maple Ridge, BC V2X 4B4 CANADA
(604) 467-9116
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Agent for Service: With a Copy to:
David Young Jeffrey Thomas Reid,
Director HOWARD LLEWELLYN
HOWARD LLEWELLYN ARGENTINA GROUP, INC
ARGENTINA GROUP, INC 2112 123rd Avenue
2112 123rd Avenue
Maple Ridge, BC V2X 4B4 Canada Maple Ridge, BC V2X 4B4
Canada
(604) 467-9116 (780) 455-2206______
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
Approximate date of commencement of proposed sale to the
public:
Approximate date of commencement of proposed sale to the
public:As soon as practicable after the effective date of
this registration statement
As soon as practicable after the effective date of this
Registration Statement.
If any of the securities being registered on this form are to
be offered on a delayed or continuous basis pursuant to Rule 415
under the Securities Act, check the following box. [x]
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. [ ]
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Amount Maximum Maximum Amount of
Title of to be Offering Aggregate Registration
each Class Registered Price Offering
of per unit price Fee
Securities
to be
registered
Common 1,000,000 $ .25 per $250,000.00 $73.75
stock shares share
The Registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date
until the registrant shall file a further amendment which
specifically states that this registration statement shall
thereafter become effective in accordance with section 8(a) of
the Securities Act of 1933 or until the registration statement
shall become effective on such date as the Securities and
Exchange Commission, acting pursuant to such section 8(a), may
determine.
Prospectus
1,000,000 shares of common stock
HOWARD LLEWELLYN ARGENTINA GROUP, INC.
$0.25 per Share
This is the initial public offering of common stock of Howard
Llewellyn Argentina Group, Inc. and no public market currently
exists for these shares. Howard Llewellyn Argentina Group, Inc.
is offering for sale up to one million shares of its common stock
on a "self-underwritten" direct participation basis at a price of
$0.25 per share for a period of one hundred and eighty days from
the date of this prospectus.
The price for the common shares offered was set arbitrarily by us
and does not relate to earnings, book value or any other
established method of valuation; there are no provisions for the
return of funds if only a small number of shares are sold and no
minimum subscription amount has been set and no commissions will
be paid for the sale of the 1,000,000 shares offered by Howard
Llewellyn Argentina Group, Inc.
THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS," PAGE 5.
Neither the SEC nor any state securities commission has approved
or disapproved of these securities or passed upon the adequacy or
accuracy of this prospectus. The SEC has not made any
recommendations that you buy or not buy the shares. Any
representation to the contrary is a criminal offense.
This prospectus is not an offer to sell these securities or our
solicitation of your offer to buy these securities in any
jurisdiction where that would not be permitted or legal.
We will not utilize an underwriter to offer or sell the shares.
Instead, our executive officers will offer and sell the units on
our behalf on a "best efforts" basis. The officers will not
receive any commissions or additional compensation for these
efforts. Therefore we will receive proceeds of $0.25 per share
sold and a total of $250,000 if the entire offering is sold.
The date of this prospectus is , 2001.
TABLE OF CONTENTS
Page
Part 1
Prospectus Summary ............................ 5
Risk Factors.................................. 5
Use of Proceeds............................... 13
Determination of Offering Price....................... 13
Dilution............................... 13
Plan of Distribution.............................. 15
Legal Proceedings............................. 16
Directors, Executive Officers, Promoters, and Control 16
Persons..........
Security Ownership of Certain Beneficial Owners and 17
Management..........
Conflicts of Interest........................... 18
Description of Securities......................... 19
Interests of Named Experts and 19
Counsel.....................
Shares Eligible for Future Sale...................... 19
Legal Matters............................... 20
Experts................................. 20
Transfer Agent............................. 20
Indemnification of Officers and 20
Directors....................
Disclosure of SEC Position on Indemnification for 21
Securities Act Liabilities....
Organization within the Last Five 21
Years...................
Description of Business......................... 21
Available Information and Reports to Securities 30
Holders..............
Management's Discussion and Analysis of Financial
Condition or Plan of 31
Operations.............................
Description of Property......................... 32
Certain Relationships and Related 33
Transactions.................
Market for Common Equity and Related Stockholder 33
Matters............
Executive Compensation.......................... 33
Financial Statements.......................... 35
Changes in and Disagreements with Accountants on
Accounting and Financial 50
Disclosure..............................
PART II - Information Not Required in Prospectus
Item 24. Indemnification of Directors and 50
Officers.................
Item 25. Other Expenses of Issuance and 51
Distribution...............
Item 26. Recent Sales of unregistered 51
Securities..................
Item 27. Exhibits............................ 52
Item 28. Undertakings.......................... 52
Signatures............................... 53
PART I - SUMMARY INFORMATION AND RISK FACTORS.
Prospectus Summary.
Howard Llewellyn Argentina Group, Inc. is a corporation formed
under the laws of the State of Nevada on April 2, 1999, whose
principal executive offices are located in Maple Ridge, British
Columbia, Canada.
The primary objective of the business is to market high-quality,
low-cost vitamins, minerals, nutritional supplements, and other
health and fitness products to medical professionals, alternative
health professionals, martial arts studios and instructors,
sports and fitness trainers, other health and fitness
professionals, school and other fund raising programs and other
similar types of customers via the Internet for sale to their
clients. Our license covers the distribution rights for the
Provinces of Saskatchewan and Manitoba, Canada. Howard Llewellyn
Argentina Group, Inc. is in the development stage and has had no
revenues.
Name, Address, and Telephone Number of Registrant
Howard Llewellyn Argentina Group, Inc.
21112 123rd Avenue
Maple Ridge, British Columbia, Canada, V6E-2K3
(604) 467-9116
The Offering
- Price per share offered $0.25
- Common stock offered by the company 1,000,000 shares
- Common stock outstanding prior to this offering 5,000,000 shares
- Common stock to be outstanding after the offering,6,000,000 shares
assuming all shares are sold
RISK FACTORS
We are a new company and have had no business operations to date.
The purchase of our common stock involves a high degree of risk.
Any of the following risks could adversely affect our business,
financial condition and results of operations, and could result
in the complete loss of your investment. Therefore, you should
evaluate the following risk factors and all other information
contained in this prospectus before you purchase any of our
stock.
General Business Risks
1. We Have Generated No Revenues to Date, and There Is
Substantial Doubt About Our Ability to Continue As a Going Concern
All investors should be aware that our company has generated no
revenues to date and currently faces an extreme shortage of cash.
Since our revenue generating activities are not in place there is
substantial doubt about our ability to continue as a going
concern.
2.We Have Had Losses Since Inception; We Expect Such Losses to
Continue for the Foreseeable Future and we Could Fail Before
Implementing Our Business Plan.
We have never had any revenues. Costs will be incurred to set up
the business plan and to go into operations, including
establishing an office, setting up our accounting systems, sales
planning, and locating and hiring qualified sales people. We
will not have substantial cash reserves even if this entire
offering is sold; if this offering is not completed, we may not
be
able to get into business.
If we are able to commence operations, we still expect to lose
money for a considerable period,at least until our profits from
sales exceed our expenses. If we do not reach this
point, any and all funds that we have in reserve will be used up.
3.We Expect to Need Additional Financing; Such Financing May Not
Be Available on Acceptable Terms and, If Not, We May Be Forced
to Discontinue Operations.
We do not have sufficient capital to properly get into business,
to respond to new technical developments or competition or to
take advantage of unexpected opportunities. Such items
as special marketing programs and the development of new services
require capital. Management estimates that our minimum expenses
for the first twelve months of operation to establish the
business and create sales and follow-up service will be $96,750.
Even if the offering is fully subscribed, after the costs of this
offering are deducted, we will have no working capital without
additional financing.
Should this offering be unsuccessful we would be faced with
several options:
- cease operations and go out of business completely;
- begin looking for additional capital on terms that are
acceptable;
- bring in additional capital that involves a change of
control; or
- seek an acquisition candidate that seeks access to the
public marketplace and sources of financing, complete a merge or
reverse takeover and probably enter into a completely different
line of business.
You should be aware of one fact: if this offering is unsuccessful
we will be unable to implement our business plan unless and until
a new source of acceptable financing is found.
We have reached an agreement with Le Monde Marketing to market
our vitamin products and to loan us the money to fund our
marketing and operational expenses during the start-up phase of
our operations. Le Monde Marketing has moved from 628-333
Terminal Avenue, Vancouver, BC, Canada, V6A 2L7 and is now
located at 29 West 6th Avenue, Vancouver, BC, Canada, V5Y 1K2.
Other than Le Monde Marketing, no other source of capital has
been approached and we do not have any other sources readily
available. If other sources are available we have no Idea
whether capital can be obtained on terms and conditions that are
acceptable. Further, any such financing may be upon terms that
result in dilution or considerable lessening of value of the
shares currently held by our shareholders.
4. Any Additional Financing We Obtain May Dilute the Ownership
Interests of Investors.
If additional capital is obtained by the sale of additional
shares, the ownership interests of all our investors will be
diluted.
5. Investors Must Rely on Management For All Decisions in
Operating our Business.
Management Has No Experience in Our Line of Business and Will
Spend Only Part-Time Managing our Business; as a Result,
Management May Make Poor Decisions, Which May Adversely Affect
Our Business.
We will be heavily dependent upon management's entrepreneurial
skills and experience to implement our business plan. Management
has no experience in the marketing and sale of vitamins and other
nutritional supplements and will devote only part of its time on
our affairs; therefore, we may experience delays or a complete
failure to implement our business plan. Further, because of lack
of experience in this line of business, we may overestimate the
marketability of the VitaMineralHerb.com products and may
underestimate the costs and difficulties associated with selling
and distributing the products. Any such unanticipated costs or
difficulties could prevent us from fully implementing our
business plan, thereby limiting prospective revenue.
6. We are Totally Dependent on One Supplier and One Website and
Any Difficulties With
These Could Seriously Affect Our Ability To Market Our
Products.
Vitamineralherb.com, the licensor is both the supplier of all of
our products and our customers access to those products. If, for
any reason, the licensor has a problem, whether it be technical,
financial or a default under their agreement with their
supplier(s), it will have a direct affect on our sales and
revenues. Any permanent disruption of Vitamineralherb.com's
ability to supply us with products or an ordering method via the
Internet could deprive us of our ability to sell and deliver our
products; at the very least cause, it would require major changes
in our operations until we could secure new products and a new
website or other means. The affect on the value of our common
stock would be very negative. Some points of specific concern
are:
< We have only one supplier;
< We have only one ordering facility: the
Vitamineralherb.com website;
< Vita mineralherb.com has only one suppler; and
< Vitamineralherb.com is dependent on many licensees getting
into business and being successful.
7. Our Ability to Create a Customer Base and Sales Depends on
the Continuing Contributions of Management and our Ability to
Attract and Retain Other Qualified Employees in the Future.
We do not have employment agreements with management and, as a
result, there is no assurance that they will continue to manage
our affairs in the future. We have not obtained a "key person"
life insurance on any member of management. If we lose the
services of any or all of management, we might not be able to
establish and increase our customer base and sales. We may be
unable to attract and retain other highly qualified employees in
the future because competition for personnel is intense and
qualified technical personnel are likely to remain a limited
resource for the foreseeable future.
8. We Will Compete With Other Vitamin Retailers and May Not be
able to achieve the Customer Base Necessary to Become or Remain
Profitable.
The vitamin, mineral and supplement market is very competitive
and highly fragmented, with no clear dominant leader and
increasing public and commercial attention. We compete with a
variety of other companies, including traditional vitamin
retailers, the online retail initiatives of several traditional
retailers, and numerous other companies. Many of our potential
competitors have longer operating histories, larger customer or
user bases, greater brand recognition and significantly greater
financial, marketing and other resources. In addition, an
online retailer may be acquired by, receive investments from, or
enter into other commercial relationships with, larger, well-
established and well-financed companies as use of the Internet
and other electronic services increases. Competitors have and
may continue to adopt aggressive pricing or inventory
availability policies and devote substantially more resources to
website and systems development. Increased competition may
result in reduced operating margins and loss of market share.
Risks Related to the Diet Supplement Industry
9. Government Regulation of Products Could Adversely Affect
Viability of Diet Supplements and In Turn Adversely Affect Our
Business.
In the United States, extensive federal government regulations
may restrict the way we sell VitaMineralHerb.com products,
resulting in restrictions on the products and content we offer
our customers and significant additional expenses. Also,
numerous U. S. Governmental agencies may regulate the
manufacture, packaging, labeling, advertising, promotion,
distribution and sale of VitaMineralHerb.com products. The
primary regulatory agency in the United States for these products
is the Food and Drug Administration (FDA). The laws,
regulations and enforcement policies governing dietary supplement
products are relatively new and still evolving and we cannot
predict what enforcement positions the FDA or other governmental
agencies may take with respect to our selling methods or the
selling and marketing efforts of VitaMineralHerb.com. In
general, the dietary supplement industry has adopted more
aggressive interpretations of these laws that have the relevant
regulatory agencies.
U.S. federal, state and local government regulations may restrict
the products we distribute.
The U.S. FDA regulates vitamin, supplements and other health care
products under the
Federal Food, Drug and Cosmetic Act and regulations promulgated
thereunder. These products are also subject to regulation by,
among other regulatory entities, the Consumer Product Safety
Commission, the U.S. Department of Agriculture, and the
Environmental Protection Agency. Additionally, the U.S.
Federal Trade Commission regulates advertising and other forms of
promotion and methods of marketing of these products under the
Federal Trade Commission Act. Also, various state and local
agencies may also regulate the manufacture, labeling and
advertising of these products.
We cannot be certain that our attempts, or those of our licensor
and its suppliers, to comply with laws and regulations in this
area are or will be deemed sufficient by the appropriate
regulatory agencies. Enforcement actions by any of these
regulatory agencies can result in civil and criminal penalties,
an injunction to stop or modify certain selling
methods, seizure of VitaMineralHerb.com products, adverse
publicity or voluntary recalls and labeling changes. If any
governmental agency were to undertake an enforcement action
against us, this could cause an immediate decrease in our
revenues, cause us to incur significant additional expenses and
result in a decrease in our stock price. Our efforts to comply
with existing laws and regulations may be costly and may force us
to change our selling strategy, which may not be successful. We
cannot promise that we will be able to comply with any existing
or future laws, regulations, interpretations or applications
without incurring significant costs or adjusting our business
plan.
10. We May Be Subject to Product Liability Suits Which Could
Adversely Affect Our
Financial Condition.
Particularly because we plan to sell VitaMineralHerb.com products
such as vitamins, minerals, nutritional supplements, and other
health and fitness products, we may be subject to product
liability claims if any of the products we sell results in
injury. We may be subjected to various product liability claims,
including, among others, that the products we distribute include
inadequate instructions for use or inadequate warnings concerning
possible side effects and interactions with other substances. We
rely on third party manufacturers for VitaMineralHerb.com
products and product disclosures. We have no product liability
insurance coverage. Although our licensor warrants the products
and provides indemnification to us for losses, claims, and
expenses arising from a breach of the product warranties, any
such indemnification is limited by its terms and as a practical
matter, is limited to the creditworthiness of the indemnifying
party. In the event that we do not have adequate
indemnification, product liability claims could be costly and
divert management's attention from business.
11. Unfavorable Publicity May Curtail the Market for
VitaMineralHerb.com Products
Which Would Adversely Affect Our Business.
Our company's business plan focuses almost entirely on the
feasibility of distributing VitaMineralHerb.com products, which
are in large part dietary supplements. The dietary supplement
market is affected by national media attention regarding the
consumption of dietary supplements. Dietary supplement products
are highly dependent upon consumers' perceptions of safety and
quality. Any negative publicity asserting that these products may
be harmful or questioning their efficacy could have a material
adverse effect on our business, regardless of whether these
reports are scientifically supported or whether the claimed
harmful effects would be present at the doses recommended for
these products. Because dietary supplements depend to such a
degree on consumers' perceptions, adverse publicity associated
with illness or other adverse effects resulting from the
consumption of the products we distribute, or any similar
products distributed by other companies, and future reports of
research that are perceived as less favorable or that question
earlier research could have a material adverse effect on our
sales and therefore our profitability.
Investment Risks
12. A Public Market for Our Securities Does Not Exist and May
Not Develop After the Offering; Therefore, Purchasers May Not
Be Able to Resell Their Shares at Prices Equal to, or Greater
than, the Offering Price.
Prior to the offering, there has been no public market for our
common stock and an active trading market may not develop.
Consequently, purchasers of the shares may not be able to resell
their securities at prices equal to, or greater than, the initial
public offering price. The market price of the shares may be
affected significantly by factors such as announcements by us or
our competitors, variations in our results of operations, and
market conditions in the retail, electronic commerce, and
Internet industries in general. Movements in prices of stock may
also affect the market price in general. As a result of these
factors, purchasers of the shares offered hereby may not be able
to liquidate an investment in the shares readily or at all.
13. Our Shares are to be offered on a Direct Participation
Offering Basis and We May not be
Able to Sell All of the Shares Offered.
The shares are offered by our executive officers on a direct
participation offering basis, and no individual, firm or
corporation has agreed to purchase or take down any of the
offered shares. We cannot and do not make any statement
guaranteeing that shares will be sold. No provisions have been
made to deposit in escrow the funds received from the purchase of
shares sold by us. Accordingly, the proceeds we raise, if any,
may be insufficient to pay our offering expenses and conduct our
feasibility study.
14. Investors May Face Significant Restrictions on the Resale
of our Stock
Due to State Blue Sky Laws.
Each state has its own securities laws, often called "blue sky
laws," which (1) limit sales of stock to a state's residents
unless the stock is registered in that state or qualifies for an
exemption from registration and (2) govern the reporting
requirements for broker-dealers and stock brokers doing business
directly or indirectly in the state. Before a security is sold
In a state, there must be a registration in place to cover the
transaction, and the broker must be
Registered in that state, or otherwise be exempt from
registration. We do not know whether our stock will be
registered under the laws of any states. The broker-dealers, if
any, who agree to serve as the market makers for our stock, will
make a determination regarding registration. There may be
significant state blue-sky law restrictions on the ability of
investors to sell, and on purchasers to buy, our securities.
Accordingly, investors should consider the secondary market for
our securities to be a limited one. Investors may be unable to
resell their stock, or may be unable to resell it without the
significant expense of state registration or qualification.
15. Investors May Face Restrictions On the Resale of our Stock
Due to Federal Penny Stock
Regulations.
Our securities, when and if they become available for trading,
will be subject to the Securities
and Exchange Commission rule that imposes special sales practice
requirements upon broker-dealers that sell such securities to
other than established customers or accredited investors. For
purposes of the rule, the phrase "accredited investors" means, in
general
terms:
a) Institutions with assets exceeding $5,000,000; and
b) Individuals having a net worth in excess of $1,000,000 or
having an annual
Income that exceeds $200,000, or that, combined with a
spouse's income, exceeds $300,000.
For transactions covered by the rule, the broker-dealer must make
a special suitability determination for the purchaser and receive
the purchaser's written agreement to the transaction prior to the
sale. Consequently, the rule may affect the ability of
purchasers of our securities to buy or sell in any market that
may develop.
The Commission has adopted a number of rules to regulate "penny
stocks." Such rules include Rules 3a51-1, 15g-1, 15g- 2, 15g-3,
15g-4, 15g-5, 15g-6 and 15g-7 under the Securities Exchange Act
of 1934.
Because our securities will constitute "penny stock" within the
meaning of the rules, the rules would apply to our securities.
The rules may further affect the ability of owners of our shares
to sell their securities in any market that may develop for them.
There may be a limited market for penny stocks, due to the
regulatory burdens on broker/dealers and the market among dealers
may not be active.
Investors in penny stock often are unable to sell stock back to
the dealer that sold them the stock. The mark-ups or commissions
charged by the broker/dealers could be greater than any profit a
seller may make. Because of large dealer spreads, investors may
be unable to sell the stock immediately back to the dealer at the
same price the dealer sold the stock to the investor. In some
cases the stock may fall quickly in value. Investors may be
unable to reap any profit from any sale of the stock, if they can
sell it at all.
Shareholders should be aware that, according to the Securities
and Exchange Commission Release No. 34-29093, the market for
penny stocks has suffered in recent years from patterns of fraud
and abuse. Such patterns include:
control of the market for the security by one or a few
broker-dealers that are often related to the promoter or
issuer;
manipulation of prices through prearranged matching of
purchases and sales and false and misleading press releases;
"boiler room" practices involving high-pressure sales
tactics and unrealistic price projections by inexperienced
sales persons;
excessive and undisclosed bid-ask differentials and markups
by selling broker/dealers;
and
the wholesale dumping of the same securities by promoters
and broker/dealers after prices have been manipulated to a
desired level, along with the inevitable collapse of those
prices with consequent investor losses.
Summary of Penny Stock Risks:
1) Our common stock is a penny stock.
2) Some states will not allow you to sell to their citizens.
3) Some broker/dealers will not handle transactions in penny
stocks.
4) SEC rules make selling your stock a cumbersome procedure.
5) Penny stock markets can be very volatile with large
swings up or down.
Use Caution Regarding Forward Looking Statements
You should not rely on forward-looking statements in this
prospectus, because such forward-looking statements involve risks
and uncertainties. We use the words such as "anticipates,"
"believes," "plans," "expects," "future," "intends" and similar
expressions to identify these forward-looking statements.
Prospective investors should not place undue reliance on forward-
looking statements, which apply only as of the date of this
prospectus. Our actual
Results could differ materially from those anticipated in these
forward-looking statements for many reasons, including the risks
faced by us described in
"Risk Factors" and elsewhere in this prospectus.
Use of Proceeds
Percent of Offering (100%) (50%) (25%) (10%)
Sold
Gross Proceeds from $250,000 $125,000 $62,500 $25,000
Offering
Net Proceeds from $237,000 $122,000. $49,500 $12,000
Offering
Organizational $1,000.00 $1,000.00 $1,000.00 $1,000.00
Costs
Feasibility of $6,500.00 $6,500.00 $6,500.00 $6,500.00
License and Market
Research
Operations $229,500 $114,500 $42,000 $4,500.00
We will have limited working capital reserves if this offering
is not fully subscribed. Therefore, we may not have money for
contingency and/or additional unanticipated expenses of getting
the business started. We believe the amount being raised will
be enough to run the business until sales revenues are sufficient
to support operations if the offering is fully subscribed. If
not, we will be forced to obtain additional funding. Other than
an oral agreement with Le Monde Marketing of Vancouver, BC to
lend us money until we become operational, there are presently no
arrangements for this funding.
Determination of Offering Price
We arbitrarily determined the price of the shares in this
offering. The offering price is not an
Indication of, and is not based upon, the actual value of Howard
Llewellyn. It bears no relationship to our book value, assets or
earnings or any other recognized measure of value. The offering
price should not be regarded as an indicator of any future market
price of the securities.
Dilution
Prior to this offering we have 5,000,000 shares of stock issued
and outstanding.
The following table illustrates the difference between the prices
paid by present shareholders and the price that will be paid by
subscribers to this offering.
Percentage of Consideration Paid and Percentage
of Shares Held
At
Different Subscription Levels
100% 50% 25% 10%
Subscription Subscription Subscription Subscription
Percentage Percentage Percentage Percentage
Held Held Held Held
Paid Paid Paid Paid
Present 05.89 83.33 11.13 90.91 20.02 95.24 38.94 98.04
Shareholders
at $0.0031 per share
Subscribers
at 94.11 16.67 88.87 09.09 75.98 04.76 62.51 01.96
$0.01 per share
"Dilution" means the difference between our public offering price
($0.01 per share) and our pro forma net tangible book value per
share after giving effect to this offering. Net tangible book
value per share is determined by dividing our tangible net worth,
consisting of tangible assets less total liabilities, by the
number of shares outstanding. The following table illustrates
under the above assumptions the dilution of a new investor's
equity as of May 31, 2001.
As of May 31, 2001, we have issued 5,000,000 shares to our
current shareholders in exchange for $15,647 in cash, an average
of approximately $0.0031 per share. Our net tangible book value
as of May 31, 2001 was $621 or approximately $0.0001 per share.
Giving effect to the sale of all shares offered for cash, our pro
forma net tangible book value after deducting expenses of this
offering estimated at $ $13,000, would be approximately
$237,621, or approximately $.2104 per share.
Public offering price per share $0. 25
Net tangible book value per share before offering $0.0001
Increase in net tangible book value per share
attributable to subscribers $0.0395
Pro forma net tangible book value per share after offering $0.0396
Dilution per share to public investors $0.2104
Plan of Distribution
This is a self - underwritten offering. This prospectus is part
of a registration statement that permits the executive officers
of Howard Llewellyn Argentina Group, Inc. to sell directly to the
public, with no commission or other remuneration payable. The
offering will not be advertised, but will be presented directly
by the executive officers to potential investors primarily
involved in the health and nutrition industry.
No public market currently exists for our shares, but we intend
to apply to have our shares traded on the NASDAQ Over-the-Counter
Bulletin Board following the completion of this offering.
The offering will be conducted by our executive officers.
Although these persons are associated person of the company, as
that term is defined in Rule 3a4-1 under the Exchange Act, these
persons are deemed not to be brokers for the following reasons:
* They are not subject to a statutory disqualification
as that term is defined in Section 3(a)(39) of the Exchange Act
at the time of their participation in the sale of our securities.
* They will not be compensated for their participation
in the sale of our securities by the payment of commission or
other remuneration based either directly or indirectly on
transactions in securities.
* They are not an associated person of a broker or
dealer at the time of their participation in the sale of our
securities.
* They will restrict their participation to the
following activities:
A. Preparing any written communication or
delivering any communication through the mails or other means
that does not involve oral solicitation by them of a potential
purchaser;
B. Responding to inquiries of potential purchasers
in a communication initiated by the potential purchasers,
provided however, that the content of responses are limited to
information contained in a registration statement filed under the
Securities Act or other offering document;
C. Performing ministerial and clerical work
involved in effecting any transaction.
As of the date of this prospectus, we have retained no broker for
the sale of securities being offered. In the event a broker who
may be deemed an underwriter is retained by us, an
Amendment to our registration statement will be filed.
The offering will remain open for a period until _____, 2001 or
180 days from the date of this prospectus, unless the entire
gross proceeds are earlier received or we decide, in our sole
discretion, to cease selling efforts. Our officers and directors,
and our stockholders and their affiliates may purchase shares in
this offering.
Legal Proceedings.
No legal proceedings have been or are currently being undertaken
for or against Howard Llewellyn Argentina Group, Inc., nor are we
aware of any contemplated proceedings.
Directors, executive officers, promoters and control persons.
The directors and executive officers currently serving Howard
Llewellyn Argentina Group, Inc. are as follows:
Name Age Positions Held and Tenure
Linden J. Soles 44 President and Director since
November 1999
Jeffrey T. Reid 38 Vice President and
Director since
November 1999
Frederick W. Vanstone 59 Secretary Treasurer and
Director since November 1999
The directors will serve until the first annual meeting of our
shareholders and their successors are elected and qualified.
Thereafter, directors will be elected for one-year terms at the
annual shareholders' meeting. Officers will hold their positions
at the pleasure of the board of directors, absent any employment
agreement.
Biographical information
Linden J. Soles has been an officer and director of Howard
Llewellyn since November 1999. Mr. Soles is perhaps best
recognized as the person who had the grim task of telling viewers
around the world that Princess Diana had died. From 1993 to 1998,
a potential global audience of 800 million people witnessed his
award winning breaking news coverage as CNN's prime time news
anchor. For over 29 years, Mr. Soles has proven to be a
consistent ratings winner and along the way has earned some of
the most prestigious international journalism awards, including
the National News & Documentary EMMY, PEABODY, NATPE IRIS,
CABLEACE, RTNDA, GABRIEL Awards and more. While at CNN, Mr. Soles
anchored its two highest-rated news broadcasts: "Prime News" and
"The World Today", as well as "World News" on CNN International.
All three programs were seen by a global audience which soon
became familiar with his ad-libbing skills during such breaking
news events as the Death of Princess Diana, the Olympic Park
Bombing, Oklahoma City Bombing, the TWA 800 Crash, the O.J.
Simpson Trials, the Kobe Earthquake, the Long Island Railroad
Massacre, the Murder of Gianni Versace, the death of Jacqueline
Kennedy Onassis and many other high profile events. From the age
of 15 in his native Canada, Mr. Soles has constantly honed his
writing, reporting, interviewing editing, producing, directing,
designing and composing skills and applied them to award-winning
TV and radio documentaries, talk shows, news programs and music
specials for companies such as the Global Television Network, The
CBC TV and Radio Networks, as well as local stations in Vancouver
and Winnipeg, before his move to CNN. Mr. Soles left CNN when his
contract was up in 1998 to form his own omnimedia company, Linden
Soles MediaWorks Inc and gain ownership and control of the
intellectual property he generates. In his capacity as an
Officer and Director of Howard Llewellyn, the Company is hoping
to leverage Mr. Soles' global "brand name" and credibility as
part of its international marketing strategy.
Frederick W. Vanstone has served as an officer and director of
Howard Llewellyn since October 1999. A proven corporate
turnaround specialist, Mr. Vanstone has, in his 37 years of
commercial banking, corporate finance, consulting and business
ownership, crafted financial strategies that have reinvigorated
companies and clients in Canada, the U.S., Europe, Australia and
New Zealand. Mr. Vanstone has Public Company experience with
securities registration in both Canada and the United States,
including taking a Public Company back to Private. From 1996 to
the present Mr. Vanstone has served as Chief of Staff, Crossroads
Family of Ministries, Burlington, Ontario, a company engaged in
ministerial services, and broadcast television. He helped guide
the organization through the acquisition of a CRTC broadcast
license for a new Toronto -area TV station, CTS, and mapped out a
blueprint to enable Crossroads to achieve greater fiscal
efficiencies. For the previous eleven years Mr. Vanstone was
associated with Oral Roberts Ministries, Tulsa, Oklahoma. He
served as officer and director of the parent organization as well
as subsidiaries and associated entities and helped to fiscally
revive the ailing Ministry and return it to positive cash flow.
In 1979 and 1980 he was CEO of Standard Guarantee Corporation.
From 1972 through 1978, Mr. Vanstone served as Chief Financial
and Administrative Officer for the Jim Pattison Group of
Companies and helped steer the organization back to private
ownership from its Public status. From 1978 to the present Mr.
Vanstone has also operated Vandella Enterprises Ltd. A company
specializing in investment, consulting and development banking.
Jeffrey T. Reid has served as an officer and director of Howard
Llewellyn since October 1999. From 1992 to the present, Mr. Reid
is the Franchise Owner of Boston Pizza International Restaurants.
Edmonton, Alberta. From 1990 through 1992 he was territory and
account manager for Cartier Wines and Beverages Ltd. He covered
Saskatchewan, Manitoba and Alberta for that company. Prior to
that he served as an independent freelance producer, production
manager and sound engineer in Winnipeg, Manitoba.
Security ownership of certain beneficial owners and management
The following table sets forth, as of the date of this
prospectus, common stock owned of record or beneficially by each
Executive Officer and Director, each person who owned of record,
or was known by us to own beneficially, more than 5% of our
common stock, and the shareholdings of all Executive Officers and
Directors as a group. Each person has sole voting and investment
power with respect to the shares shown.
Shares Percentage of
Name Owned Shares Owned
Linden J. Soles 250,000 5.00%
President and Director
21112-123rd Avenue, Maple Ridge, BC,
Canada V2X 4B4
Frederick W. Vanstone 150,000 3.00%
Secretary, Treasurer,
And Director
21112-123rd Avenue, Maple Ridge, BC,
Canada V2X 4B4
Jeffrey T. Reid 100,000 2.00%
Vice President and Director
21112-123rd Avenue, Maple Ridge, BC,
Canada V2X 4B4
Gateway Equities1 250,000 5.00%
21112-123rd Avenue, Maple Ridge, BC,
Canada V2X 4B4
Hy Potential Investments Ltd.2 250,000 5.00%
21112-123rd Avenue, Maple Ridge, BC,
Canada V2X 4B4
All directors and executive
Officers as a group (3 persons) 500,000 10.00%
1 Craig D. Soles is the sole owner of Gateway Equities. Mr.
Soles' address is Box 32051, 2619-14th Street SW, Calgary,
Alberta, Canada, T2T-5X6, Telephone 403-243-3311.
2 David Young is the sole owner of Hy Potential Investments,
Ltd. Mr. Young's address is 21112-123rd Avenue, Maple Ridge, BC,
Canada V2X 4B4, Telephone 604-467-7982.
Conflicts of Interest
Although the officers and directors initially will not be
involved with the company on a full-time basis, each will devote
a minimum of fifteen hours per week to the affairs of the
company. As a result, there may be occasions when time
requirements of the company conflict with the demands of other
business and investment activities of the officers and directors
and the interests of the company might be adversely affected. As
our business develops, we may need to employ additional personnel
and, if so, we cannot be sure that qualified people will be
available or, if they are available, that we will be able to
employ them at a price we can afford.
Description of securities
The following description is a summary of the material terms of
our capital stock. This summary is subject to and qualified in
its entirety by our Articles of Incorporation and Bylaws, and by
the applicable provisions of Nevada law.
The authorized capital stock of the company consists of
100,000,000 shares of common stock having a par value of $0.001
per share per share. The Articles of Incorporation do not permit
cumulative voting for the election of directors, and shareholders
do not have any Preemptive rights to purchase shares in any future
issuance of Howard Llewellyn's common stock.
The holders of shares of our common stock do not have cumulative
voting rights in connection with the election of the Board of
Directors, which means that the holders of more than 50% of such
outstanding shares voting for the election of directors can elect
all of the directors to be elected, if they so choose, and, in
such event, the holders of the remaining Shares will not be able
to elect any of our directors.
The holders of shares of common stock are entitled to dividends
out of funds legally available when and as declared by the Board
of Directors. The Board of Directors has never declared a
dividend and does not anticipate declaring a dividend in the
future. Each outstanding share of common stock entitles the
holder thereof to one vote per share on all matters. The holders
Of the shares of common stock have no preemptive or subscription
rights. In the event of liquidation, dissolution or winding up of
the affairs of the company, holders are entitled
to receive, ratably, the net assets available to shareholders
after payment of all creditors.
All of the issued and outstanding shares of common stock are duly
authorized, validly issued, fully paid, and non-assessable. To
the extent that additional shares of our common stock are issued,
the relative interests of existing shareholders may be diluted.
Interests of Named Experts and Counsel
No "Expert" or "Counsel" as defined by Item 509 of Regulation S-B
promulgated pursuant To the Securities Act of 1933, whose services
were used in the preparation of this Form SB-2/A was hired on a
contingent basis or will receive a direct or indirect interest
in the company.
Shares Eligible for Future Sale
Upon completion of the offering, we will have a minimum of
5,000,000 shares and a maximum of 6,000,000 shares of common
stock outstanding. The shares held by current shareholders will
not be freely tradable without restriction or registration under
the Securities Act of 1933. A current shareholder who is an
"affiliate" of the company, defined in Rule 144 as a person who
directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, a
company, will be required to comply with the resale limitations
of Rule 144.
Purchasers of shares in the offering, other than affiliates, may
resell their shares immediately. Sales by affiliates will be
subject to the volume and other limitations of Rule 144,
including certain restrictions regarding the manner of sale,
notice requirements, and the availability of current public
information about the company. The volume limitations generally
permit an affiliate to sell, within any three month period, a
number of shares that does not exceed the greater of one percent
of the outstanding shares of common stock or the average weekly
trading volume during the four calendar weeks preceding his sale.
A person who ceases to be an affiliate at least three months
before the sale of restricted securities beneficially owned for
at least two years may sell the restricted securities under Rule
144 without regard to any of the Rule 144 limitations.
Legal Matters
The validity of the shares offered hereby will be passed upon for
the Company by Kenneth M. Christison, Esq.
Experts
The financial statements of the company as of December 31, 2000,
included in this prospectus have been audited by Janet Loss,
C.P.A., P.C., independent certified public accountants, as stated
in their opinion, which has been rendered upon the authority of
said firm as experts in accounting and auditing.
Transfer Agent
We currently serve as our own transfer agent, and plan to
continue to serve in that capacity until such time as management
believes it is necessary or appropriate to employ an independent
transfer agent in order to facilitate the creation of a public
trading market for its securities. Should our securities be
quoted on any exchange or OTC quotation system, or if application
is made to have the securities quoted, an independent transfer
agent will be appointed.
Indemnification of Officers and Directors
As permitted by Nevada law, our Articles of Incorporation provide
that the company will indemnify its directors and officers
against expenses and liabilities they incur to defend, settle or
satisfy any civil or criminal action brought against them on
account of their being or having been company directors or
officers, unless, in any such action, they are adjudged to have
acted with gross negligence or willful misconduct.
Pursuant to the laws of the State of Nevada, our Articles of
Incorporation exclude personal liability for our directors for
monetary damages based upon any violation of their fiduciary
duties as directors, except as to liability for any breach of the
duty of loyalty, acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law,
acts in violation of Section 7-106-401 of the Nevada Business
Corporation Act, or any transaction from which a director
receives an improper personal benefit. This exclusion of
liability does not limit any right, which a director may have to
be indemnified, and does not affect any director's liability
under federal or applicable state securities laws.
Disclosure of SEC position on indemnification for Securities Act
liabilities
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
persons controlling the company pursuant to provisions of the
State of Nevada, we have been informed that, in the opinion of
the Securities and Exchange Commission, such indemnification is
against public policy as expressed in that Act and is, therefore,
unenforceable.
Organization within the last five years
The company was incorporated in the State of Nevada on April 2,
1999 and David R. Mortenson was the original promoter. We are
in the early stages of development and our only activities to
date have been the development of our business plan and the
preparation for this registration statement. We have had no
revenues nor do we have any expectation of revenues until the
completion of this offering and the commencement of business.
Description of business
We have had no business operations to date. On April 5, 1999, in
exchange for 2,000,000 shares of common stock, we received from
David R. Mortenson & Associates of Alvin, Texas, the rights to
produce and distribute in the state of Florida, an oxygen
enriched water product for fish farming, aquaculture,
mariculture, poultry raising, and for treating animal waste from
dairies, feedlots of all kinds, and for other similar uses.
David R. Mortenson and Associates had acquired these rights from
the inventors of the product, N. W. Technologies, Inc.; however,
several months later the contract granting David R. Mortenson &
Associates rights to the technology was withdrawn by the
inventors. David R. Mortenson and Associates subsequently sued
N.W. Technologies Inc. in Harris County Court, Houston Texas.
As a result, on January 3, 2000, we entered into an agreement
with David R. Mortenson & Associates to cancel and terminate the
agreement of April 5, 1999, and David R. Mortenson & Associates
released us from any and all financial responsibility or
liability under that agreement. In addition, in order to
compensate us for the termination of our rights under the
agreement, we were granted a license agreement, at no additional
cost, for the exclusive right to distribute the vitamin and
herbal supplements of Vitamineralherb.com Corp., in the Provinces
of Manitoba and Saskatchewan, Canada.
The License.
We have a three year license from Vitamineralherb.com Corp. to
market and sell vitamins, minerals, nutritional supplements, and
other health and fitness products to medical professionals,
alternative health professionals, martial arts studios and
instructors, sports and fitness trainers, other health and
fitness professionals, school and other fund raising programs and
other similar types of customers through a website maintained by
Vitamineralherb.com. In return for payment of a $500 annual
maintenance fee, we as a licensee, and our customers will have
access to all products offered on the Vitamineralherb.com
website, as well as to custom-formulated and custom-labeled
products. Three different labeling options are available to
customers:
- Products may be ordered with the manufacturer's standard
label with no customization.
- the fitness or health professional may customize the labels
by adding its name, address, and phone number to the standard
label. In most cases, these labels would be a standardized label
with product information and a place on the label for the wording
"Distributed by." This gives these health and fitness
professionals a competitive edge.
- labels may be completely customized for the health or
fitness professional.
When a fitness or health professional becomes a client, our
salesperson will show the client how to access the
Vitamineralherb.com website. The client is assigned an
identification number that identifies it by territory,
salesperson, and business name, address, and other pertinent
information. The health or fitness professional may then order
the products it desires directly through the Vitamineralherb.com
website, paying for the purchase with a credit card, electronic
check ("e-check"), or debit card with all financial transactions
being handled by Vitamineralherb.com 's Internet clearing bank.
The Vitamineralherb.com webmaster will download e-mail orders
several times a day, check with the clearing bank for payment,
and then submit the product order and electronic payment to
International Formulation and Manufacturing. All products will
be shipped by the manufacturer directly to the purchaser or
clients as directed
Prices for the products will be set by Vitamineralherb.com based
on the manufacturer's price it pays, plus a markup, which will
include a 10% commission to Vitamineralherb.com, as well as our
profit. Upon receipt of payment for a product order, the
clearing bank will direct the 10% commission to
Vitamineralherb.com, remit the retail price of the order to the
manufacturer, and direct the balance to us as our profit on the
order. Although our profit may vary depending on the specific
products sold, we expect the average profit margin to be
approximately 20% of the retail price.
Vitamineralherb.com 's software will track all sales through the
customer's identification number, and at month end, e-mail a
detailed report including sales commissions to us.
Vitamineralherb.com has indicated that it will use e-commerce
advertising such as banner ads on major servers and websites, as
well as attempting to insure that all major search engines pick
Vitamineralherb.com first. All sales originating from the website
to customers located in Saskatchewan and Manitoba will
automatically be assigned to us.
As a licensee of Vitamineralherb.com, we will have the advantage
of not being required to develop products or a delivery system,
store inventory, build and maintain a website, or establish
banking liaisons, us to focus strictly on marketing and selling
the products. We plan to target health and fitness professionals
in Manitoba and Saskatchewan who wish to offer high-quality
health and fitness products to their customers. To date,
Vitamineralherb.com has granted a total of forty-six licenses for
the distribution of their vitamin and herbal supplements. At the
end of the three-year license period, our license will be
automatically be renewed unless either we or Vitamineralherb.com
give the other party notice of its intent not to renew.
Vitamineralherb.com
VitaMineralHerb.com was incorporated as a Nevada corporation on
April 2, 1999, for the
purpose of creating a virtual store that would provide customers the
convenience of purchasing health related products from any location
for direct shipment to a home or business through the Internet. It
is a private company, and is not registered with the SEC.
VitaMineralHerb.com's business is to market high quality low cost
vitamins, herbs and health supplements to health
And fitness professionals that are then resold to their clients.
VitaMineralHerb.com does not sell
to the general public. VitaMineralHerb.com is a relatively young
company and has just begun developing its vitamin marketing and
distributorship business. It currently offers 61 products
for sale on its web site, including Kava Kava, St. John's Wort, Saw
Palmetto, Gingko Biloba, Echinacea, Siberian Ginseng, Chromium
Picolinate, Glucosamine Chondroitin, and Vitamin C,
As well as many others.
On June 9, 1999, VitaMineralHerb.com entered into a manufacturing
agreement with International Formulation and Manufacturing Inc.,
a nutraceuticals- manufacturing firm located in San Diego, California.
International Formulation and Manufacturing Inc. was recently acquired
by Ives Formulation Co. On June 22, 2000, VitaMineralHerb.com entered into
a new manufacturing agreement with Ives Formulation Co. that incorporated
the same terms and provisions of the June 9, agreement with International
Formulation and Manufacturing Inc.
Ives Formulation is a wholly owned subsidiary of Ives Health
Company, a public company Traded on the OTC: BB under the symbol "IVEH."
Ives Formulation has been a contract manufacturer of vitamin, mineral,
nutritional supplement, and alternative health products For various
marketing organizations. Ives Formulation does no retail marketing. In
addition to a line of standard products, Ives Formulation is able to
manufacture custom blended products and also has the capability to supply
privately labeled products for our customers at a minimal added cost.
Le Monde Marketing Agreement.
In the event the net proceeds received from this offering are
not sufficient to accomplish our objectives, we will require
additional financing from other sources. In February 2000, Le
Monde Marketing, Vancouver, B.C., orally agreed to provide us a
minimum of $100,000 for operational expenses during our start-up
period. That agreement was confirmed in a letter dated April 23,
2001, which proposed the following timing of the funding using
the date this registration statement becomes effective as a
starting date:
Stage Description Time Funds Purpose
1 Confirmation of 1st and 2nd 1,000 Research
Market months
2 Establishment of 3rd month 12,000 Rent
Office 12,000 Administration
10,000 Office Equipment
12,000 1 year Office
Expense
Allowance
3 Recruiting of Two 4th - 6th 24,000 Wages
Salesmen months 12,000 Sales Expense
4 Advertising 7th month 500 Website
Maintenance
5 Generation of 10th - 12th -- Expectation of
Revenues months Revenues
TOTAL $83,500
In return for any funding provided, for a period of five years
thereafter, Le Monde Marketing will receive one percent ( 1%) of
all net commissions received by us from sales through
Vitamineralherb.com for each $2,000 of funding up to one hundred
thousand dollars ($100,000), as well as one percent ( 1%) of any
sales commissions generated by Le Monde Marketing by sales of
Vitamineralherb.com products through its existing distribution
network for each $2,000 of funding up to one hundred thousand
dollars ($100,000).
Growth of the Internet and electronic commerce.
The Internet has become an increasingly significant medium for
communication, information and commerce. According to NUA
Internet Surveys, as of February 2000, there were approximately
275.5 million Internet users worldwide. At the IDC Internet
Executive Forum held on September 28-29, 1999, IDC stated that in
1999 US $109 billion in purchases were impacted by the Internet.
IDC's vice president, Sean Kaldor, indicated that figure is
expected to increase more than ten-fold over the next five years
to US $1.3 trillion in 2003, with $842 million completed directly
over the Web. Howard Llewellyn Argentina Group, Inc. believes
that this dramatic growth presents significant opportunities for
online retailers.
We have assembled some of the available data regarding Internet
commerce that will be a portion of the information that is to be
digested in order to complete our study as to feasibility.
Web Commerce: 1996 $2.6 billion
2000 $220 billion
Web Users: 1996 28 million
2000 175 million
(Source: Ziff Davis)
Nearly one trillion will be spent on Information Technology (IT)
in 2000, representing about 60 percent of all capital spending
compared to just 10% of all capital spending in 1980.
(Source: NUA)
Nearly half of US Internet users have purchased a product or
service online.
(Source: A. C. Nielsen-May 11, 2000)
Consumers who have used the Internet since 1995 spend an average
of $ 388 per transaction while those who have been online for a
year only spend an average of $ 187 per transaction. The
equivalent figure for those who have been using the Internet
since 1997 is $ 298.
(Source: National Association of Business Economics)
An estimated 120 million Internet users, or 40 percent of the
total number online, have already made an online purchase,
according to a study from the Angus Reid Group. Over 50 % of all
online transactions were made in the USA. US users made an
average of 7 purchases in the three months before the survey,
spending an average of $828. The worldwide average spent by an
individual in the same period was less than $500.
75% of online shoppers in the US and Canada pay for e-commerce
purchases by credit card. Direct bank drafts, bank transfers and
cash on delivery are the other most favored payments methods. 93%
of Internet shoppers around the world said they were "somewhat
satisfied" or "extremely satisfied" with their online shopping
experience.
(Source: Angus Reid Group)
Internet advertising revenue more than doubled in 1999, coming to
a year-end total of $ 4.62 billion.
(Source: Internet Advertising Bureau [IAB])
AS OF MARCH 2000 THERE WERE A WORLDWIDE TOTAL OF 304,360,000
INTERNET CONNECTIONS. THE BREAKDOWN IS AS FOLLOWS:
Africa 2,589,000
Asia/Pacific 68,900,000
Europe 83,350,000
Middle East 1,900,000
USA & Canada 136,860,000
South Africa 10,740,000
(Source: Various; Methodology - Compiled by: Nua Internet
Surveys)
Financial results from the first quarter of this year show that
while Amazon nearly doubled its revenue, it sustained bigger
losses than during the same period last year. Despite this,
sales were up 95 percent from USD294 million in 1999 to USD574
million in 2000.
(Source: Reuters)
Global e-commerce will be worth 7.0 trillion dollars by 2004. 50%
of global sales will come from the US.
(Source: Forrester)
The vitamin, supplement, mineral and alternative health product
market.
In recent years, a growing awareness of vitamins, herbs, and
other dietary supplements by the general public has created a
whole new segment in the field of medicine and health care
products. According to Jupiter Communications, online sales of
such products are expected to be US $434 million in the year
2003, up from $1 million in 1998. We believe that several factors
are driving this growth, including a rapidly growing segment of
the population that is concerned with aging and disease, a
growing interest in preventative health care, favorable consumer
attitudes toward alternative health products and a favorable
regulatory statute, the Dietary Supplement Health and Education
Act of 1994.
The removal of most, if not all import duties, under the NAFTA
accord enables us to import our goods without undue trouble or
delay. Some of sources relied upon for product will undoubtedly
be located in Canada and will be easily available to Canadian
customers as well as being exported to the United States.
The electronic commerce industry is new, rapidly evolving and
intensely competitive, and we expect competition to intensify in
the future. Barriers to entry are minimal and current and new
competitors can launch sites at a relatively low cost. In
addition, the vitamin supplement, mineral and alternative health
product market is very competitive and highly fragmented, with no
clear dominant leader and increasing public and commercial
attention.
Our competitors can be divided into several groups including:
- traditional vitamins, supplements, minerals and alternative
health products retailers;
- the online retail initiatives of several traditional
vitamins, supplements, minerals and alternative health products
retailers;
- online retailers of pharmaceutical and other health-related
products that also carries vitamins, supplements, minerals
and alternative health products;
- independent online retailers specializing in vitamins,
supplements, minerals and alternative health products;
- mail-order and catalog retailers of vitamins, supplements,
minerals and alternative health products, some of which have
already developed online retail outlets; and
- direct sales organizations, retail drugstore chains, health
food store merchants, mass market retail chains and various
manufacturers of alternative health products.
Our potential competitors have longer operating histories, larger
customer or user base, greater brand recognition and
significantly greater financial, marketing and other resources
than we have. In addition, as use of the Internet and other
electronic services increases, an online retailer may be acquired
by, receive investments from, or enter into other commercial
relationships with, larger, well established and well financed
companies.
Competitors have and may continue to have aggressive pricing
policies and may devote substantially more resources to website
and systems development than we will. Increased competition may
result in reduced operating margins and loss of market share.
We believe that the principal competitive factors in its market
are:
- ability to attract and retain customers;
- breadth of product selection;
- product pricing;
- ability to customize products and labeling;
- quality and responsiveness of customer service.
We believe that we can compete favorably on these factors.
However, we will have no control over how successful our
competitors are in addressing these factors. In addition, our
online competitors can duplicate many of the products or services
offered on the Vitamineralherb.com site.
Traditional retailers of vitamins, supplements, minerals and
other alternative health products face several challenges in
succeeding:
- Lack of convenience and personalized service. Traditional
retailers have
limited store hours and locations. Traditional retailers
are also unable to provide consumers with product advice
tailored to their particular situation.
- Limited product assortment. The capital and real estate
intensive nature of store-based retailers limit the product
selection that can be economically offered in each store
location.
- Lack of Customer Loyalty. Although the larger traditional
retailers often attract customers, many of these customers are
only one-time users. People are often attracted to the name
brands, but find the products too expensive.
- the multilevel structure of some marketing organizations
mandates high prices.
As a result of the foregoing limitations, we believe there is
significant unmet demand for a shopping channel like that of Vita
that can provide consumers of vitamins, supplements, minerals and
other alternative health products with a broad array of products
and a convenient and private shopping experience.
We hope to attract and retain consumers through the following key
attributes of our business:
- Broad Expandable Product Assortment. Our product selection
may be substantially larger than that offered by store-based
retailers since we do not have to maintain large inventories.
- Low Product Prices. Product prices can be kept low due to
volume purchases through our affiliation with Vitamineralherb.com
and other licensees. Our not having an inventory, warehouse
space and need for limited administration should also make our
prices lower. All products will be shipped directly from
Vitamineralherb.com 's inventory.
- Accessibility to Customized Products. At minimal cost,
health and fitness practitioners may offer their customers
customized products.
- Access to Personalized Programs. Health or fitness
professional can tailor vitamin and dietary supplement regimes to
their clients.
Regulatory Environment.
The manufacturing, processing, formulating, packaging, labeling
and advertising of the products Howard Llewellyn Argentina Group,
Inc. sells in Canada are, or may be, subject to regulation by
Health Canada which administers the Food and Drugs Act along with
relevant regulation thereto. Regulated products include herbal
remedies, natural health remedies, functional foods and
nutraceuticals. Health Canada regulates the formulation,
manufacture, labeling and distribution of foods, including
dietary supplements, cosmetics and over-the-counter or
homeopathic drugs. Under the Food and Drugs Act, a variety of
enforcement actions are available to Health Canada against
marketers of unapproved drugs or "adulterated" or "misbranded"
products. These include: criminal prosecution; injunctions to
stop the sale of a company's products; seizure of products;
adverse publicity "voluntary" recalls and labeling changes.
The Consumer Packaging and Labeling Act, as administered by
Industry Canada, requires that certain information labeling be
presented in a prescribed manner on all foods, drugs, dietary
supplements and cosmetics. A product may be deemed an unapproved
drug and "misbranded" if it bears improper claims or improper
labeling.
The manufacturing, processing, formulating, packaging, labeling
and advertising of the products Howard Llewellyn Argentina Group,
Inc. sells may also be subject to regulation by one or more U.S.
federal agencies, including the Food and Drug Administration, the
Federal Trade Commission, the United States Department of
Agriculture and the Environmental Protection Agency. These
activities also may be regulated by various agencies of the
states, localities and foreign countries in which consumers
reside.
The Food and Drug Administration, in particular, regulates the
formulation, manufacture, labeling and distribution of foods,
including dietary supplements, cosmetics and over-the- counter or
homeopathic drugs.
Food and Drug Administration regulations require that certain
informational labeling be presented in a prescribed manner on all
foods, drugs, dietary supplements and cosmetics.
The Food and Drug Administration has indicated that claims or
statements made on a company's website about dietary supplements
may constitute "labeling" and thus be subject to regulation by
the Food and Drug Administration.
It is possible that the statements presented in connection with
product descriptions on Howard Llewellyn Argentina Group, Inc.'s
site may be determined by the Food and Drug Administration to be
drug claims rather than nutritional statements. Some of Howard
Llewellyn Argentina Group, Inc.'s suppliers may incorporate
objectionable statements directly in their product names or on
their products' labels, or otherwise fail to comply with
applicable manufacturing, labeling and registration requirements
for over-the-counter or homeopathic drugs or dietary supplements.
As a result, Vitamineralherb.com may have to remove or modify
some statements, products or labeling from its website.
Howard Llewellyn Argentina Group, Inc. cannot predict the nature
of any future Canadian or U.S. laws and regulations nor can it
determine what effect additional governmental regulations or
administrative orders would have on our business in the future.
Although the regulation of dietary supplements is less
restrictive than that of drugs and food additives Howard
Llewellyn Argentina Group, Inc. cannot assure you that the
current statutory scheme and regulations applicable to dietary
supplements will remain less restrictive.
Any laws, regulations, enforcement policies, interpretations or
applications applicable to Howard Llewellyn Argentina Group,
Inc.'s business could require the reformulation of certain
products to meet new standards, the recall or dropping of certain
products, additional record keeping, expanded documentation of
the properties of certain products, expanded or different
labeling.
Regulation of the Internet.
In general, existing laws and regulations apply to the Internet.
The precise applicability of these laws and regulations to the
Internet is sometimes uncertain. The vast majority of such laws
were adopted prior to the Internet and do not address the unique
issues of the Internet or electronic commerce.
Numerous federal and state government agencies have already
demonstrated significant activity in promoting consumer
protection on the Internet. Due to the increasing use of the
Internet as a medium for commerce and communication, it is
possible that new laws and regulations could be passed with
respect to the Internet. These new laws and regulations could
cover issues such as user privacy, freedom of expression,
advertising, pricing, content and quality of products and
services, taxation, intellectual property rights and information
security. The adoption of such laws or regulations and
applicability of existing laws and regulations to the Internet
may slow the growth of Internet use and result in a decline in
Howard Llewellyn Argentina Group, Inc.'s sales.
A number of legislative proposals have been made at the federal,
state and local level, and by foreign governments, that would
impose additional taxes on the sale of goods and services over
the Internet, and some states have taken measures to tax Internet-
related activities. Although Congress recently placed a three-
year moratorium on new state and local taxes on Internet access
or on discriminatory taxes on electronic commerce, existing state
or local laws were expressly excepted from this moratorium. Once
lifted, some type of federal and/or state taxes may be imposed
upon Internet commerce which may substantially impair growth and,
as a result have a negative affect on our business.
Employees.
We are a development stage company and currently have no
employees and are currently managed by our officers and
directors. We look to the board for management and financial
skills and talents. Management plans to use consultants,
attorneys and accountants as necessary, rather than engaging any
full-time employees in the near future other than sales
representatives.
Available Information and Reports to Securities Holders.
We have filed with the Securities and Exchange Commission a
registration statement on Form SB-2 with respect to the common
stock offered by this prospectus. This prospectus, which
constitutes a part of the registration statement, does not
contain all of the information set forth in the registration
statement or the exhibits and schedules which are part of the
registration statement. For further information with respect to
the company and its common stock, see the registration statement
and the exhibits and schedules thereto. Any document we file may
be read and copied at the Commission's Public Reference Room
located at 450 Fifth Street N.W., Washington D.C. 20549. Please
call the Commission at 1-800-SEC-0330 for further information
about the public reference room. Our filings with the Commission
are also available to the public from the Commission's website at
http://www.sec.gov.
Upon our registration statement becoming effective, we will
become subject to the information and periodic reporting
requirements of the Securities Exchange Act of 1934 and,
accordingly, will file periodic reports, proxy statements and
other information with the Commission. Such periodic reports,
proxy statements and other information will be available for
inspection and copying at the Commission's public reference
rooms, and the website of the Commission referred to above.
Management's Discussion and Analysis of Financial Condition or
Plan of Operation.
Upon the completion of all or part of the sale of shares
contained in this offering, we intend to proceed as quickly as
possible to do an in-depth feasibility study and if and when that
study proves the project to be feasible, hire one or more sales
representatives to present its service to potential customers.
Geography is an obstacle that must be dealt with. The Provinces
of Manitoba and Saskatchewan are very large, making adequate
coverage by one salesperson virtually impossible. A minimum of
two representatives will be necessary. After opening accounts,
these representatives will be necessary to service existing
customers. Research has indicated that this servicing or
detailing of already established accounts results in larger
increases in reorders of product.
Estimated expenses for the next twelve months are as follows:
US dollars
Cdn.dollars
Two sales persons (draw against commissions)
@ $1000 per month* 24,000 $ 36,000
Administration 12,000 $ 18,000
Employee benefits 16,000 $ 24,000
Office rent $ 12,000 $ 18,000
Office supplies (including furniture) $ 10,000 15,000
Development stage costs (including
recruiting costs) 1,000 1,500
Website maintenance 500 $ 750
Contingency (10%) 8,750 $ 13,125
Total first year expenses $ 84,250 $126,375
* All figures shown are in United States and Canadian dollars. A
conversion rate of 1.5 was used.
If the offering proceeds received, together with any funding
from Le Monde Marketing, are not sufficient to fund all our
planned activities operations will be scaled down. One sales
person will be hired instead of two; administration will be
handled by an officer and director at no cost. The same officer
and director will supply office space during the start-up
process. Growth will be much slower and we will not be able to
rent office space or hire administrative help until sales volumes
and gross profits are large enough. If no funds are received
from this offering, management will be forced to decide whether
or not to proceed with the business and either delay starting or
cancel the project completely.
Milestones:
1. Confirmation of Market - 1st and 2nd months after effective
date; offering proceeds and/or funding from Le Monde Marketing.
Our management has already begun to implement the first stage of
the business plan. We intend to retain a competent specialist to
do a marketing survey of the Provinces of Manitoba and
Saskatchewan.
2. Establishment of an office - 3rd month after effective date;
offering proceeds and/or funding from Le Monde Marketing. One
administration office is planned for both provinces. Sales
people would office in their own homes. The one office that we
would establish would act as a coordinating and business office,
looking after sales support, bookkeeping and payroll. We
estimate that office space will cost in the neighborhood of $16
per square foot including taxes and insurance. We estimate that
we will require about 1,000 square feet initially.
3. Recruiting of sales people - 4th - 6th months after
effective date; offering proceeds and/or funding from Le
Monde Marketing. We estimate that we will require two sales
people to cover the Provinces of Saskatchewan and Manitoba;
one headquartered in the city of Regina covering
Saskatchewan and the other in Winnipeg, the Provincial
Capitol of Manitoba, which would be our administrative
office. Sales people will be provided with a basic draw
against commissions of $1,000 per month. They will
initially cover the two major cites, thereby keeping
expenses to a minimum. Potential customers in rural
Manitoba and Saskatchewan which have hundreds of small towns
and villages, will be pre-qualified by telephone, followed
by a personal sales call. Cost of recruiting sales people
is estimated at $3,000.
4 Advertising - 7th month after effective date; offering
proceeds and/or funding from Le Monde Marketing. We envision
advertising of our products and services as a very low-keyed
approach. We believe that direct mail is the best and most cost
effective method of reaching our potential clients. Due to the
fact that we are targeting a fairly narrow segment of the
population as potential retailers, a well-designed mail piece and
cover letter with follow up by telephone should be adequate to
introduce us to our potential clients. Design and production of
a mailing piece is estimated to cost $7,000.
5. Generation of Revenues - 10th - 12th months after effective
date; no funding requirement. We believe that a planned, slow-
but-steady growth pattern will serve us in the best fashion. By
keeping costs low and concentrating first on the major population
centers, we believe we can generate revenues in a fairly short
time. We expect the initial order by each new customer to be
comparatively large, as the customer will be establishing an
initial inventory of products. Thereafter, each customer will
order product only as required to replenish inventory as products
are sold. We believe that the relatively large initial orders
expected may provide sufficient early cash flow to reach a break-
even point, or to generate a small profit, from operations before
the funds available from Le Monde Marketing are used up.
Description of property.
We maintain a mailing address at the office of Hy Potential
Investments Ltd., one of our shareholders, but otherwise do not
presently maintain an office. We pay no rent for use of the
mailing address and we own no real estate.
Certain Relationships and Related Transactions
Prior to the date of this registration statement we issued to ten
individuals a total of 2,000,000 shares of common stock in
consideration of acquiring the rights to manufacture and market
an oxygen-enhanced product for use in aquaculture, fish and
poultry farming and the bioremediation of waste ponds and lagoons
in the state of Florida. David R. Mortenson and Associates, a
Texas general partnership acquired these rights from the
inventors of the product, N.W. Technologies Inc. under a
distribution agreement.
In December 1999 N.W. Technologies unilaterally canceled its
contract and distribution agreement with David R. Mortenson and
Associates. David R. Mortenson and Associates as well as several
of the concerns that have an interest in the technology through
distribution agreements with David R. Mortenson and Associates,
have filed suit in Harris County court, Texas against N.W.
Technologies Inc, its officers and directors and several other
individuals and concerns involved with the cancellation and
withdrawal.
On January 3, 2000, we entered into an agreement with David R.
Mortenson and Associates terminating our agreement to produce and
distribute the oxygen-enhanced products. We were released from
any and all financial responsibility or liability by the terms of
that agreement.
In order to avoid litigation with us and to protect our
shareholders, David R. Mortenson and Associates granted us a
distribution territory for an Internet based vitamin and health
supplement company. There was no charge for this distribution
territory, which is the Provinces of Saskatchewan and Manitoba,
Canada.
Market for common equity and related stockholder matters.
Howard Llewellyn Argentina Group, Inc. is a development stage
company that is still in the beginning stages of implementing its
business plan. No market currently exists for the common stock.
Upon completion of all or part of the offering of common shares
contained in this registration statement, it is the intention of
Howard Llewellyn Argentina Group, Inc. to apply for a trading
symbol and a listing to have its shares quoted on the Over-the-
Counter Bulletin Board. There can be no assurance that any part
of this offering will be subscribed to and if all or part of the
offering is subscribed to, that the request of Howard Llewellyn
Argentina Group, Inc. to have the price of its stock quoted on
the Over-the-Counter Bulletin Board will be granted. You should
take all of the above facts into consideration before making a
decision to purchase any amount of Howard Llewellyn Argentina
Group, Inc. stock.
Executive compensation.
The following discussion addresses all compensation awarded to,
earned by, or paid to our named executive officers and directors.
No officer or director has received any remuneration, whether
cash, stock, or other non-cash payment, from us. Although there
is no current plan in existence, it is possible that we will
adopt a plan to pay or accrue compensation to the officers and
directors for services related to the implementation of the
business plan. Howard Llewellyn has no stock option, retirement,
incentive, defined benefit, actuarial, pension or profit-sharing
programs for the benefit of directors, officers or other
employees, but the Board of Directors may recommend adoption of
one or more such programs in the future.
We have no employment contract or compensatory plan or
arrangement with any executive officer. The directors and
officers currently do not receive any cash compensation for
Service as members of the Board of Directors. There is no
compensation committee and no compensation policies have been
adopted.
The following table and the accompanying notes provide summary
information for each of the last two fiscal years since the
company's inception concerning cash and non-cash compensation
paid to, or accrued by, management.
Annual Compensation
Securities
Name and Other Restricted Underlying LTIP All
Principal Year Salary Bonus Annual Stock Options Payouts Other
Position Compensation Award SARs Compensation
($) ($) ($) ($) (#) ($)
Linden 1999 0 0 0 0 0 0 0
J. 2000 0 0 0 0 0 0 0
Soles,
President
&
Director
Frederick 1999 0 0 0 0 0 0 0
W. 2000 0 0 0 0 0 0 0
Vanstone,
Secretary,
Treasurer
&
Director
Jeffrey 1999 0 0 0 0 0 0 0
T. 2000 0 0 0 0 0 0 0
Reid,Vice
President
&Director
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A Development Stage Enterprise)
AUDIT REPORT
December 31, 2000 and 1999
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1780 S. Belaire Street, Suite 500
Denver, Colorado 80222
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A Development Stage Enterprise)
INDEX TO FINANCIAL STATEMENTS
TABLE OF CONTENTS
ITEM PAGE
Report of Certified Public Accountant..................... F1
Balance Sheet, December 31, 2000 and 1999................. F2
Statement of Operations, For the
Year Ended December 31, 2000 and
For Period April 2, 1999 (Inception)
Through December 31, 1999................................. F3
Statement of Stockholders Equity
(Deficit), For the Year Ended
December 31, 2000 and For Period
April 2, 1999 (Inception)
Through December 31, 1999................................. F4
Statement of Cash Flows For the
Year Ended December 31, 2000 and
For Period for the Period
April 2, 1999 (Inception)
Through December 31, 1999 ................................ F5
Notes to Financial Statements............................ F6-F9
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1780 S. Belaire Street, Suite 500
Denver, Colorado 80210
(303) 782-0878
INDEPENDENT AUDITOR'S REPORT
Board of Directors
Howard Llewellyn Argentina Group Inc.
21112 123rd Avenue
Maple Ridge, British Columbia V2X4B4
Sirs:
I have audited the accompanying Balance Sheet of Howard Llewellyn
Argentina Group Inc. (A Development Stage Enterprise) as of
December 31, 2000 and 1999 and the Statements of Operations,
Stockholders' Equity, and Cash Flows for the
Year Ended December 31, 2000 and for Period April 2, 1999
(Inception) through December 31, 1999. These financial
statements are the responsibility of the Company's management.
My responsibility is to express an opinion on these financial
statements based on my audit.
My audit was made in accordance with generally accepted auditing
standards. Those standards require that I plan and perform the
audits to obtain reasonable assurance as to 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. I believe that my audit
provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of
Howard Llewellyn Argentina Group Inc. as of December 31, 2000 and
1999, and the results of its operations and changes in its cash
flows for the For the Year Ended December 31, 2000 and the period
April 2, 1999 (Inception) through December 31, 1999, in
conformity with generally accepted accounting principles applied
on a consistent basis.
/s/Janet Loss
Janet Loss, C.P.A., P.C.
May 29, 2001
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
DECEMBER 31, 2000 and 1999
December 31, 2000 December 31,1999
Audited Audited
CURRENT ASSETS:
Receivables $ 100 $ 0
TOTAL CURRENT ASSETS 100 0
OTHER ASSETS
Deferred Offering Costs 12,100 0
TOTAL ASSETS 12,200 0
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES 0 0
LONG-TERM LIABILITIES 0 0
STOCKHOLDERS EQUITY:
COMMON STOCK $0.001 PAR
VALUE; 100,000,000 SHARES
AUTHORIZED AND 5,000,000
SHARES ISSUED AND OUTSTANDING 2,500 2,500
Common Stock Issuable (Note I) 100 0
ADDITIONAL PAID-IN CAPITAL 12,526 147
Deemed Dividend re: Purchase
Of License Rights (2,000) (2,000)
(DEFICIT ACCUMULATED DURING
THE DEVELOPMENT STAGE) (926) (647)
TOTAL STOCKHOLDERS' EQUITY (Deficit) 12,200 0
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 12,200 $ 0
The accompanying notes are an integral part of the financial
statements.
F2
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2000 AND FOR THE PERIOD
APRIL 2, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999
December 31, 2000 December 31, 1999
Audited Audited
REVENUES: $ 0 $ 0
OPERATING EXPENSES:
Accounting and legal expenses 0 165
OFFICE EXPENSES 279 162
TAXES AND LICENSES 0 320
TOTAL OPERATING EXPENSES 279 647
NET (LOSS) FOR THE YEAR $(279) $ (647)
NET (LOSS) PER SHARE (N/A) (N/A)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 5,000,000 5,000,000
The accompanying notes are an integral part of the financial
statements.
F3
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDERS EQUITY (DEFICIT)
FOR THE PERIOD APRIL 2, 1999 (INCEPTION) THROUGH DECEMBER 31,1999
AND FOR THE YEAR ENDED DECEMBER 31, 2000
(Deficit)
Common Common Common Additional Deemed Accumulated Total
Stock Stock Stock Paid-in Dividend during the Stockholders
Number Amount Issuable Capital Development Equity
Of Stage
Shares
April 2, 1999
Issuance of
Common Stock 500000 500 0 147 0 0 647
Issuance of
Common Stock
For License 2000000 2000 0 0 0 0 2000
Rights
Deemed Dividend
Re: Purchase of
License Rights 0 0 0 0 (2000) 0 (2,000)
Issuance of
Common Stock 2500000 0 0 0 0 0 0
Reflecting 2-1
forward split
Deficit for the
Period From
April 2,1999
(Inception)
through
December 31,
1999 0 0 0 0 0 (647) (647)
Balance,
December 31,
1999 5000000 2500 0 147 (2,000) (647) 0
June 30, 2000
100,000 Shares
to be Issued 0 0 100 12379 0 0 12479
Net (Loss)for
The Year Ended
December 31,
2000 0 0 0 0 0 (279) (279)
Balance, 5000000 2500 100 12526 (2000) (926) 12200
December 31,
2000
The accompanying notes are an integral part of the financial
statements.
F4
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2000 AND THE PERIOD
APRIL 2, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999
December 31, 2000 December 31, 1999
Audited Audited
CASH FLOWS FROM (TO)
OPERATING ACTIVITIES:
NET(LOSS) $ (12,379) $ (647)
ADJUSTMENTS TO RECONCILENET
LOSS TO NET CASH FLOW FROM
OPERATING ACTIVITIES:
(INCREASE) IN RECEIVABLES (100) 0
CASH PROVIDED (USED) BY
OPERATING ACTIVITIES (12,479) (647)
CASH FLOWS FROM (TO)
INVESTING ACTIVITIES: 0 0
CASH FLOWS FROM (TO)
FINANCING ACTIVITIES:
DEEMED DIVIDEND RE: LICENSE RIGHTS 0 (2,000)
ISSUANCE OF COMMON STOCKS
AND COMMON STOCKS ISSUABLE 100 2,500
ADDITIONAL PAID-IN CAPITAL 12,379 147
NET INCREASE (DECREASE) IN CASH $ 0 $ 0
CASH, BEGINNING OF PERIOD 0 0
CASH, END OF PERIOD $ 0 $ 0
The accompanying notes are an integral part of the financial
statements.
F5
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 AND 1999
NOTE I. ORGANIZATION AND HISTORY
The Company is a Nevada Corporation and the Company has been in
the development stage since its formation on April 2, 1999.
The Company's only activities have been organizational, directed
at acquiring its principal assets, raising its initial capital
and developing its business plan.
On April 2, 1999, the Company issued 500,000 shares of common
stock as founder shares to the officers and directors of the
Company. The shares are for compensation of time, effort and
expenditures to organize and form the corporation.
On April 28, 1999, the Company issued 2,000,000 shares of common
stock in return for the water treatment rights for the state of
Florida and the development of the business plan. The issued
price of the shares and the cost of the license were recorded as
deemed dividend.
On November 24, 1999 all 2,500,000 shares of common stock of the
Company effected a two - to - one forward split for a total of
5,000,000 issued and outstanding shares. On the same day, the
Directors of the Company sold 500,000 in a private transaction at
$0.001 per share.
On January 3, 2000, David Mortenson and Associates cancelled the
water treatment license rights in Florida with the Company. On
the same day, David Mortenson & Associates returned 4,000,000
post split shares of the Company because of the cancellation of
the water treatment license. On the same day the Company decided
to redistribute the returned shares to new investors. The
4,000,000 shares were sold at the price of $0.001 per share.
On January 20, 2000 David Mortenson and Associates gave the
Company a License to distribute vitamins, minerals, herbs and
other health products and supplements through the Internet. This
was given to the Company as compensation for the cancelled water
treatment license.
F6
NOTE I. ORGANIZATION AND HISTORY
On June 30, 2000 The Company has authorized an additional 100,000
common shares to be issued to a shareholder at $0.001 each.
NOTE II. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
DEVELOPMENT STAGE ACTIVITIES
The Company has been in the development stage since inception.
ACCOUNTING METHOD
The Company records income and expenses on the accrual method.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents includes cash on hand, cash on deposit,
and highly liquid investments with maturities generally of three
months or less. At December 31, 2000, there were no cash
equivalents.
DEFERED OFFERING COSTS
Costs associated with the Company's private offerings have been
charged to the proceeds of the offering. If the offerings are
unsuccessful the costs will be charged to operations. To date the
Company has spent a total of $12,100 in fees and expenses. They
are for $2,000 in printing and engraving, $8,000 in registration
statement and professional services, $1,500 in accounting, $500
in transfer agent and registrar, $100 in miscellaneous. The
company is expected to bear all expenses relating to the
offering. The initial amount is expected to be about $13,000.
USE OF ESTIMATES
The preparation of financial statements in accordance with
generally accepted accounting principles. It requires management
to make estimates and assumptions that affect the reported
amounts of assets and liabilities at the date of financial
statements, as well as revenues and expenses reported for the
periods presented. The Company regularly assesses these estimates
and, while actual results may differ management believes that the
estimates are reasonable.
F7
NOTE III. LICENSE AGREEMENT
The terms and conditions of the water treatment agreement were as
follows:
1. The Company agrees to pay the Grantor the sum of $2,000 in
the sum of 2,000,000 shares of common stock having a par value of
$0.001 per share.
2. The agreement is for a term of three years.
3. The contract covers onetime License fee of $10,000.00,
annual fee of $20,000.00, monthly royalty payment of 8%, minimum
purchase obligations of $50,000.00 in the first 6 months, $75,000
in the next six months and $175,000.00 in the second year. The
Licensee will pay for each technical personnel from the Company
in the amount of $300.00 per day plus travel and accommodation
expenses.
4. The contract is exclusive and the territory covers the State
of Florida.
The new license from David Mortenson & Associates is for
distribution of vitamins, minerals, herb and other health
products and supplements through the Vitamineralherb.com website.
The license calls for a 10% add-on for all products purchased and
an annual $500 website maintenance fee. The effective date of
the License Agreement was January 3,2000.
NOTE IV - RELATED PARTY TRANSACTIONS
David R. Mortenson is one of the original incorporators and
Directors of the Company and is a principal in David
Mortenson & Associates and Vitamineralherb.com. He is at non-
arms length with the Company.
David Mortenson & Associates is involved in a lawsuit against
N.W. Technologies, Inc. in Harris County Court, Texas. In the
opinion of management, the Company has no direct or indirect
interest in the Texas lawsuit.
NOTE V - GOING CONCERN
As of December 31, 2000, the Company's revenue generating
activities are not in place, and the Company has incurred a loss
for the period then ended. In addition, the Company does not
currently have any source of financing readily available.
F8
NOTE V - GOING CONCERN
These factors raise substantial doubt about the Company's ability
to continue as a going concern.
The Company intends to raise additional funds through the sale of
equity securities and / or borrowings. The Company's ability to
commence operations depends heavily on its ability to raise such
funds through equity financing activities. There can be no
assurance that such funds will be available to the Company, or
available on terms of acceptable to the Company. If the Company
is unable to raise such funds in equity markets, it will be
unable to commence operations or generate revenues.
F9
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A Development Stage Enterprise)
INTERIM FINANCIAL STATEMENTS
(PREPARED BY MANAGEMENT)
FOR THE PERIOD ENDED AUGUST 31, 2001
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
INTERIM FINANCIAL STATEMENTS
(PREPARED BY MANAGEMENT)
BALANCE SHEETS
AS OF AUGUST 31, 2001
August 31, 2001 December 31,2000
Un-Audited Audited
CURRENT ASSETS:
Receivables $ 100 $ 100
TOTAL CURRENT ASSETS 100 100
OTHER ASSETS
Deferred Offering Costs 12,100 12,100
TOTAL ASSETS 12,200 12,200
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES 0 0
LONG-TERM LIABILITIES 0 0
STOCKHOLDERS EQUITY:
COMMON STOCK $0.001 PAR
VALUE; 100,000,000 SHARES
AUTHORIZED AND 5,000,000
SHARES ISSUED AND OUTSTANDING 2,500 2,500
Common Stock Issuable (Note I) 100 100
ADDITIONAL PAID-IN CAPITAL 20,626 12,526
Deemed Dividend re: Purchase
Of License Rights (2,000) (2,000)
(DEFICIT ACCUMULATED DURING
THE DEVELOPMENT STAGE) (9,026) (926)
TOTAL STOCKHOLDERS' EQUITY (Deficit) 12,200 12,200
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 12,200 $12,200
HOWARD LLEWELLYN ARGENTINA GROUP INC.
(A DEVELOPMENT STAGE ENTERPRISE)
INTERIM FINANCIAL STATEMENTS
(PREPARED BY MANAGEMENT)
STATEMENT OF OPERATIONS
FOR THE FIVE MONTH PERIOD ENDED AUGUST 31, 2001
AUGUST 31, 2001 December 31, 2000
Un-Audited Audited
REVENUES: $ 0 $ 0
OPERATING EXPENSES:
Accounting and legal expenses 0 0
OFFICE EXPENSES 0 279
TAXES AND LICENSES 0 0
TOTAL OPERATING EXPENSES 0 279
NET (LOSS) FOR THE PERIOD $ (0) $ (279)
NET (LOSS) PER SHARE (N/A) (N/A)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 5,000,000 5,000,000
CONSENT OF INDEPENDENT AUDITOR
Janet Loss, C.P.A., P.C.
Certified Public Accountant
1780 South Bellaire
Suite 500
Denver, CO 80222
The Board of Directors
Howard Llewellyn Argentina Group Inc.
21112 123rd Avenue
Maple Ridge, BC V2X 4B4
Canada
Dear Sirs:
This letter will authorize you to include the Audit of your
company dated May 29, 2001 and the Audit Reports for the years
ended December 31, 2000 and 1999 in the Registration Statement
currently under review with the Securities and Exchange
Commission.
Yours Truly,
/s/Janet Loss
Janet Loss, C.P.A., P.C.
June 19, 2001
Changes in and Disagreements with Accountants on Accounting and
Financial disclosure.
There have been no changes in and/or disagreements with Janet
Loss, C.P.A., P.C. on accounting and financial disclosure
matters.
PART II - Information Not Required in Prospectus
Item 24. Indemnification of directors and officers.
Howard Llewellyn's Articles of Incorporation provide that it must
indemnify its directors and officers to the fullest extent
permitted under Nevada law against all liabilities incurred by
reason of the fact that the person is or was a director or
officer or a fiduciary of an employee benefit plan, or is or was
serving at the request of as a director or officer, or fiduciary
of an employee benefit plan, of another corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise.
The effect of these provisions is potentially to indemnify Howard
Llewellyn's directors and officers from all costs and expenses of
liability incurred by them in connection with any action, suit or
proceeding in which they are involved by reason of their
affiliation with Howard Llewellyn. Pursuant to Nevada law, a
corporation may indemnify a director, provided that such
indemnity shall not apply on account of:
(a) acts or omissions of the director finally adjudged to be
intentional misconduct or a knowing violation of law;
(b) unlawful distributions; or
(c) any transaction with respect to which it was finally
adjudged that such director personally received a
benefit in money, property, or services to which the
director was not legally entitled.
The bylaws of Howard Llewellyn, filed as Exhibit 3.2, provide
that it will indemnify its officers and directors for costs and
expenses incurred in connection with the defense of actions,
suits, or proceedings against them on account of their being or
having been directors or officers of Howard Llewellyn, absent a
finding of negligence or misconduct in office.
Howard Llewellyn's Bylaws also permit it to maintain insurance on
behalf of its officers, directors, employees and agents against
any liability asserted against and incurred by that person
whether or not Howard Llewellyn has the power to indemnify such
person against liability for any of those acts.
Item 25. Other expenses of issuance and distribution.
Expenses incurred or (expected) relating to this Registration
Statement and distribution are as follows: The amounts set forth
are estimates except for the SEC registration fee:
Amount
SEC registration fee $ 73.75
Printing and engraving expenses 2,000.00
Registration Statement fees and expenses 8,000.00
Accountants' fees and expenses 1,500.00
Transfer agent and registrar's fees
and expenses 500.00
Miscellaneous 926.25
Total $13,000.00
To date Howard Llewellyn Argentina Group, Inc. has spent a total
of $13,000 for office expenses and legal and accounting fees.
Item 26. Recent sales of unregistered securities.
Set forth below is information regarding the issuance and sales
of Howard Llewellyn Argentina Group, Inc. securities without
registration since its formation. No such sales involved the use
of an underwriter, no advertising or public solicitation were
involved, the securities bear a restrictive legend and no
commissions were paid in connection with the sale of any
securities.
On April 2, 1999, Howard Llewellyn Argentina Group, Inc. issued
500,000 shares of common stock to the officers and directors as
founders' shares in return for the time, effort and expenditures
to organize and form the corporation.
On April 28, 1999 Howard Llewellyn Argentina Group, Inc. issued
2,000,000 shares of common stock to David Mortenson and
Associates in return for the rights to utilize and distribute
certain water treatment technology in the state of Florida. The
shares were issued in reliance on the exemption from registration
provided by section 4(2) of the Securities Act of 1933. On
January 3, 2000, the agreement between the company and David
Mortenson and Associates was terminated and all shares issued to
David Mortenson and Associates on April 28, 1999, now numbering
4,000,000 by virtue of a two for one forward split on November
24, 1999, were returned to the company. On the same date, the
company sold 4,000,000 shares at a price of $0.001 per share to
44 investors for total proceeds of $4,000. The shares were
issued in reliance on the exemption from registration provided by
section 4(2) of the Securities Act of 1933.
Item 27. Exhibits.
The following exhibits are filed as part of this Registration
Statement;
Exhibit
Number Description
3.1* Articles of Incorporation
3.2* Bylaws
5.1 Opinion re: Legality
10.1* License Agreement
10.2* Assignment of License Agreement
10.3* License Agreement-Water
23.1 Consent of Independent Auditors
* previously filed
Item 28. Undertakings
The undersigned registrant hereby undertakes:
1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration
statement:
(a) To include any prospectus required by section 10(a)(3) of
the Securities Act of 1933;
(b) 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.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which is being registered) any
deviation from the high or low end of the estimated maximum range
may be reflected in the form of prospectus filed with the
commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change
in the maximum aggregate offering price set forth in the
"Calculation of registration Fee" table in the effective
registration statement; and
(c) To include any additional or changed material information on
the plan of distribution.
2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the
securities offered and the offering of the securities at that
time to be the initial bona fide offering.
3) To file a post-effective amendment to remove from registration
any of the securities being registered, which remain unsold at
the end of the offering.
4) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers or
persons controlling Howard Llewellyn Argentina Group, Inc.
pursuant to provisions of the State of Nevada or otherwise,
Howard Llewellyn Argentina Group, Inc. has been advised that, in
the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in that Act
and is, therefore, unenforceable.
In the event that a claim for indemnification against such
liabilities (other than the payment by us of expenses incurred or
paid by a director, officer or controlling person of us in the
successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection
with the securities being registered, we will, unless in the
opinion of our counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by us is against public
policy as expressed in the Securities Act and we will be governed
by the final adjudication of such issue.
Signatures
Signatures
In accordance with the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form
SB-2 and authorized this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the
City Vancouver, Province of British Columbia, Canada
On September 21, 2001
(Registrant) Howard Llewellyn Argentina Group, Inc.
By: /S/ Linden J. Soles
Linden J. Soles, President.
In accordance with the requirements of the Securities Act of
1933, this registration statement has been signed by the
following persons in the capacities and on the date stated.
By: /S/ Linden J. Soles,
Linden J. Soles, President and Director
Date: September 21, 2001
By: /S/ Frederick W. Vanstone
Frederick Vanstone, Secretary/Treasurer, Director,
Chief Financial Officer and Chief Accounting Officer Date:
_September 21, 2001
By: /S/ Jeffrey T. Reid
Jeffrey T. Reid, Vice President and Director
Date: September 21, 2001