As filed with the Securities and Exchange Commission on October 5, 2004
Registration No.
-----------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
MT ULTIMATE HEALTHCARE CORP.
(Exact name of Registrant as specified in its charter)
NEVADA 8082 88-0477056
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or Classification Code Number) Identification Number)
organization)
MACDONALD TUDEME
MT ULTIMATE HEALTHCARE CORP. MT ULTIMATE HEALTHCARE CORP.
45 MAIN STREET, SUITE 617 45 MAIN STREET, SUITE 617
BROOKLYN, NEW YORK 11201 BROOKLYN, NEW YORK 11201
(718) 943-3400 (718) 943-3400
(Address, and telephone number (Name, address and telephone number
of principal executive offices) of agent for service)
Copies to:
DAVID M. LOEV
ATTORNEY AT LAW
2777 ALLEN PARKWAY, SUITE 1000
HOUSTON, TEXAS 77019
(713) 524-4110
Approximate date of commencement of proposed sale to the public: As soon
as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act,
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 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,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
TITLE OF EACH CLASS OF PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING REGISTRATION
REGISTERED REGISTERED(1) PER SECURITY(2) PRICE FEE
- -------------------------------- ----------------- ------------------ ------------------- -------------
Common Stock, $.001 par value(3) 12,389,380 $ 0.345 $ 4,274,336 $ 541.56
- -------------------------------- ----------------- ------------------ ------------------- -------------
Common Stock, $.001 par value(4) 1,400,000 $ 0.345 $ 483,000 $ 61.20
- -------------------------------- ----------------- ------------------ ------------------- -------------
TOTAL 13,789,380 $ 4,757,336 $ 602.76
- -------------------------------- ----------------- ------------------ ------------------- -------------
<FN>
(1) In addition to the shares of Common Stock set forth in the table, the
amount to be registered also covers such indeterminate number of additional
shares of Common Stock as may become issuable upon conversion of or
otherwise pursuant to the Notes and exercise of the Warrants to prevent
dilution resulting from stock splits, stock dividends, or similar
transactions in accordance with Rule 416.
(2) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(c) under the Securities Act of 1933, using the
average of the bid and asked price as reported on the Over-the-Counter
Bulletin Board on October 1, 2004.
(3) Represents 200% of the shares issuable upon conversion of the Notes at
$0.113 per share as of October 4, 2004.
------------------------------------
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED OCTOBER 5, 2004
MT ULTIMATE HEALTHCARE CORP.
13,789,380 SHARES OF COMMON STOCK
This prospectus (the "Prospectus") relates to the resale by the Selling
Security Holders of up to 13,789,380 shares of the common stock, $.001 par value
per share (the "Common Stock") of MT Ultimate Healthcare Corp. (the "Company").
On August 31, 2004 ("Closing"), the Company entered into a Securities Purchase
Agreement (the "Agreement") with AJW Partners, LLC ("Partners"), AJW Offshore,
Ltd. ("Offshore"), AJW Qualified Partners, LLC ("Qualified"), and New Millennium
Capital Partners II, LLC ("New Millennium") to purchase callable secured
convertible notes having an aggregate principal amount of $700,000, a 10% annual
interest rate payable quarterly, a term of two (2) years, and a conversion
price, as of October 5, 2004 (the "Filing Date"), of $0.113 per share (the
"Convertible Notes" or "Notes"). Partners, Offshore, Qualified and New
Millennium are collectively referred to herein as the "Selling Security
Holders." The Agreement also provides for the issuance of warrants to purchase
up to an aggregate of 700,000 shares of Common Stock, with an exercise price of
$0.45 per share (the "Warrants"). The shares of Common Stock being offered for
resale in this Prospectus consist of 200% of the shares of Common Stock issuable
upon conversion of the Convertible Notes (or 12,389,380 shares as of the Filing
Date), and 200% of the shares of Common Stock issuable upon the exercise of the
Warrants (or 1,400,000 shares). We will not receive any proceeds from the
resale of our Common Stock issuable upon conversion of the Notes or exercise of
the Warrants. We will, however, receive proceeds from the sale of the
Convertible Notes and exercise of the Warrants. As of the date of this
Prospectus, we have sold $500,000 of the Convertible Notes. We have agreed to
sell an additional $200,000 of Convertible Notes upon the effectiveness of the
registration statement to which this Prospectus is a part. The sale of the
additional Convertible Notes is subject to our satisfaction of certain
conditions described in the section entitled "RISK FACTORS".
The Common Stock is quoted on the Nasdaq OTC Bulletin Board (the "OTCBB")
under the trading symbol "MTHC". The last reported sale price of our Common
Stock on the OTCBB as of October 1, 2004 was $0.29 per share.
AN INVESTMENT IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD
PURCHASE THESE SECURITIES ONLY IF YOU CAN AFFORD TO LOSE YOUR ENTIRE INVESTMENT.
WE URGE YOU TO READ THE "RISK FACTORS" SECTION BEGINNING ON PAGE 7 ALONG WITH
THE REST OF THIS PROSPECTUS BEFORE YOU MAKE YOUR INVESTMENT DECISION.
NEITHER THE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR
DISAPPROVED OF THESE SECURITIES, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING SECURITY HOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN
OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
The date of this Prospectus is October 5, 2004
TABLE OF CONTENTS
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PAGE
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About This Prospectus 5
Prospectus Summary 5
Summary Financial Data 7
Risk Factors 7
Forward Looking Statements 14
Use of Proceeds 14
Dividend Policy 15
Selling Security Holders 15
Plan of Distribution 17
Legal Proceedings 18
Directors, Executive Officers, Promoters and Control Persons 18
Security Ownership of Certain Beneficial Owners and Management 19
Description of Securities 20
Legal Matters 21
Experts 21
Disclosure of Commission Position of Indemnification for Securities
Act Liabilities 22
Description of Business 22
Management's Discussion and Analysis 25
Description of Property 31
Certain Relationships and Related Transactions 31
Market for Common equity and Related Stockholders Matters 31
Executive Compensation 32
Financial Statements F-1
Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure 33
PART II. Information Not Required in Prospectus 33
ABOUT THIS PROSPECTUS
---------------------
You should only rely on the information contained in this Prospectus. We
have not authorized anyone to provide you with information different from that
contained in this Prospectus. The Selling Security Holders are offering to sell,
and seeking offers to buy, shares of common stock only in jurisdictions where
offers and sales are permitted. The information contained in this Prospectus is
accurate only as of the date of this Prospectus, regardless of the time of
delivery of this Prospectus or of any sale of common stock.
This summary highlights selected information contained elsewhere in this
Prospectus. To understand this offering fully, you should read this entire
Prospectus carefully, including the section entitled "RISK FACTORS" and the
section entitled "FINANCIAL STATEMENTS".
All references to "we," "our," or "us," refer to MT Ultimate Healthcare
Corp., a Nevada corporation, and its wholly-owned subsidiaries M.T. Marketing
Int. Corp. and B.P. Senior Care Inc. unless specifically stated otherwise.
PROSPECTUS SUMMARY
------------------
The following summary is qualified in its entirety by the detailed
information appearing elsewhere in this Prospectus. The securities offered
hereby are speculative and involve a high degree of risk. See "Risk Factors."
THE COMPANY
MT Ultimate Healthcare Corp. (the "Company") was originally incorporated in
Nevada under the name JavaJuice.net ("JavaJuice") on September 13, 2000. The
Company's business plan was to engage in the operation of an Internet Cafe, in
Reno, Nevada. Prior to entering into an Exchange Agreement, discussed below,
and the consummation of the transactions thereunder, the Company was considered
a development stage enterprise, as defined in Financial Accounting Standards
Board No. 7.
On August 8, 2003, JavaJuice, M.T. Marketing Int. Corp., a Nevada
corporation ("MT"), and the former MT shareholders entered into an Exchange
Agreement (the "Exchange" or "Acquisition") whereby MT became a wholly-owned
subsidiary of the Company. In addition, MacDonald Tudeme, the Company's Chief
Executive Officer, a director of the Company, and a former MT shareholder,
entered into a stock purchase agreement with the Company's former officer and
director, Laura Mazany. As a result of these transactions, control of the
Company shifted to the former MT shareholders. JavaJuice was considered a
"shell" at the time of the Acquisition; therefore, the transaction was treated
as a reverse merger.
In September 2003, the Company completed an 80 to 1 forward stock split
followed by a 1 to 4 reverse stock split. The stock splits are collectively
referred to herein as the "Stock Splits." The effects of the Stock Splits have
been retroactively reflected in this Prospectus unless otherwise stated.
In July 2004, the Company acquired all of the issued and outstanding common
stock of B.P. Senior Care, Inc., a New Jersey corporation ("BP") from BP's sole
shareholder in exchange for 200,000 shares of the Company's Common Stock. As
additional consideration, the Company agreed to pay BP's sold shareholder an
aggregate of $150,000 cash payable as follows: a) $25,000 upon closing the
transaction; and b) $125,000 payable at the beginning of the month in equal
monthly installments of $4,808 over a twenty-five month period beginning June
2004, and a final payment of $4,800 at the beginning of the twenty-sixth month
following June 2004. BP provides 24-hour healthcare services to senior citizens
in the New Jersey metropolitan area.
In October 2004, the Company entered into an Agreement and Plan of
Acquisition and Merger ("Agreement") to acquire Abundant Nursing, Inc., a
Pennsylvania corporation ("Abundant") in exchange for $150,000 paid at closing
and a five-year promissory note in the principal amount of $295,000 that accrues
interest at a rate of seven percent (7%) per annum. Abundant may be merged with
and into the Company after the Company has fully-paid all amounts due under the
Agreement. Until such time as the Company pays the full consideration pursuant
to the Agreement, Abundant will be operated by the Company as a stand alone
subsidiary. Abundant is located in Mount Joy, Pennsylvania and provides staffing
in the central area of Pennsylvania and the Lancaster area.
The Company, through its wholly-owned Nevada subsidiary, MT, operates a
payroll nurse staffing and homecare business. The Company provides healthcare
professionals such as Certified Nursing Assistants, Nurse Technicians, Licensed
Practical Nurses and Registered Nurses to hospitals, nursing homes, licensed
home care services agencies ("LHCSAs"), other health-related businesses, and to
the homes of the elderly, sick and incapacitated. In January 2004, the Company
received a license from the State of New York, Department of Health, effective
December 9, 2003, to operate as a LHCSA in the five boroughs of New York City:
The Bronx, Brooklyn, Manhattan, Queens and Staten Island, as well as in Nassau
County. As a result of a change in business focus due to the acquisition of MT,
the Company changed its name to MT Ultimate Healthcare Corp. The Company also
operates a 24-hour healthcare services business for senior citizens through its
wholly-owned New Jersey subsidiary, BP. Hereinafter, a reference to the Company
includes a reference to MT and BP unless otherwise provided.
-5-
Our principal executive offices are located at 45 Main Street, Suite 617,
Brooklyn, New York 11201. Our telephone number is (718) 943-3400 and our fax
number is (718) 243-2124.
THE OFFERING
Common Stock offered by Selling
Security Holders Up to 13,789,380 shares of Common
Stock including i) up to 12,389,380
shares (or 200% of the shares)
issuable upon conversion of the
Convertible Notes with an aggregate
principal amount of $700,000 at a
conversion price of $0.113 per
share as of the Filing Date; and
ii) up to 1,400,000 shares (or 200%
of the shares) issuable upon the
exercise of Warrants at an exercise
price of $0.45 per share.
Common Stock Outstanding Before
the Offering 53,560,040 shares
Common Stock Outstanding After the Offering
(assuming full conversion of the
Convertible Notes as of the Filing
Date, additional shares being Registered
for accrued interest and other charges,
and no exercise of the Warrants) up to 65,949,420 shares
Use of Proceeds This Prospectus relates to shares
of Common Stock that may be offered
and sold from time to time by the
Selling Security Holders. We will
not receive any proceeds from the
resale of our Common Stock. We
will, however, receive proceeds
from the exercise of the Warrants.
Market for our Common Stock Our Common Stock is quoted on the
OTCBB under the trading symbol
"MTHC". The market for our Common
Stock is highly volatile as
discussed in more detail, below,
under the heading "RISK FACTORS".
We can provide no assurance that
there will be a market in the
future for our Common Stock.
-6-
SUMMARY FINANCIAL DATA
----------------------
We derived the summary financial information from our financial statements
appearing in the section in this Prospectus entitled "FINANCIAL STATEMENTS". You
should read this summary financial information in conjunction with the section
entitled "MANAGEMENT'S DISCUSSION AND ANALYSIS", our financial statements and
related notes to the financial statements.
Year Ended Six Months Ended
December 31, 2003 June 30, 2004
------------------- ---------------
(Audited) (Unaudited)
Gross Profit $ 266,365 $ 216,722
Total expenses 363,325 698,782
------------------- ---------------
Net Income (loss) from operations $ (96,960) $ (482,060)
Tax provisions - -
------------------- ---------------
Net Income (Loss) $ (96,960) $ (482,060)
Earnings (loss) per share $ (0.00) $ (0.01)
Total Assets $ 403,823 $ 497,950
Total Liabilities $ 268,318 $ 455,361
Shareholders' equity $ 135,505 $ 42,589
RISK FACTORS
------------
This Prospectus contains certain forward-looking statements. Actual results
could differ materially from those projected in the forward-looking statements
as a result of certain of the risk factors set forth below. The shares of Common
Stock being offered hereby involve a high degree of risk. Prospective investors
should consider the following risk factors inherent in and affecting the
business of the Company and an investment in the shares of Common Stock.
RISKS RELATING TO THE SECURITIES TO WHICH THIS PROSPECTUS RELATES
THE ISSUANCE AND SALE OF COMMON STOCK UNDERLYING THE CONVERTIBLE NOTES AND THE
- ------------------------------------------------------------------------------
WARRANTS MAY DEPRESS THE MARKET PRICE OF OUR COMMON STOCK.
- ----------------------------------------------------------
As of the Filing Date, we had 53,560,040 shares of Common Stock issued and
outstanding. We are registering in this Prospectus 13,789,380 shares of Common
Stock consisting of 12,389,380 shares of Common Stock issuable upon conversion
of $700,000 of Convertible Notes, and 1,400,000 shares of Common Stock issuable
upon exercise of the Warrants. As sequential conversions and sales take place,
the price of our Common Stock may decline and if so, the holders of the
Convertible Notes would be entitled to receive an increasing number of shares,
which could then be sold, triggering further price declines and conversions for
even larger numbers of shares, to the detriment of the investors in this
Offering. All of the shares issuable upon conversion of the Notes and upon
exercise of our Warrants, may be sold without restriction. The sale of these
shares may adversely affect the market price of our Common Stock.
THE ISSUANCE AND SALE OF COMMON STOCK UNDERLYING THE CONVERTIBLE NOTES AND THE
- ------------------------------------------------------------------------------
WARRANTS REPRESENT OVERHANG.
- ----------------------------
In addition, the Common Stock issuable upon conversion of the Convertible
Notes and exercise of the Warrants may represent overhang that may also
adversely affect the market price of our Common Stock. The Convertible Notes may
be converted at a conversion price of $0.113 per share, as of the Filing Date.
The Warrants may be exercised at a price of $0.45 per share. As of October 1,
2004, the market price for one share of our Common Stock was $0.29. The
Convertible Notes and Warrants may be converted into Common Stock at a discount
to the market price providing holders with the ability to sell their Common
Stock at or below market and still make a profit. In the event of such overhang,
holders will have an incentive to sell their Common Stock as quickly as possible
to ensure as much profit as possible in case the stock price falls. If the share
volume cannot absorb the discounted shares, the market price per share of our
Common Stock will likely decrease.
-7-
THE ISSUANCE OF COMMON STOCK UNDERLYING THE CONVERTIBLE NOTES AND THE WARRANTS
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MAY CAUSE IMMEDIATE AND SUBSTANTIAL DILUTION.
- ---------------------------------------------
The issuance of Common Stock upon conversion of the Convertible Notes and
exercise of the Warrants may result in immediate and substantial dilution to the
interests of other stockholders since the Selling Security Holders may
ultimately receive and sell the full amount issuable on conversion or exercise.
Although the Selling Security Holders may not convert their Convertible Notes
and/or exercise their Warrants if such conversion or exercise would cause them
to own more than 4.9% of our outstanding Common Stock, this restriction does not
prevent the Selling Security Holders from converting and/or exercising some of
their holdings and then converting the rest of their holdings. In this way, the
Selling Security Holders could sell more than this limit while never holding
more than this limit.
THE CONTINUOUSLY ADJUSTABLE CONVERSION PRICE FEATURE OF OUR CONVERTIBLE NOTES
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COULD REQUIRE US TO ISSUE A SUBSTANTIALLY GREATER NUMBER OF SHARES, WHICH MAY
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ADVERSELY AFFECT THE MARKET PRICE OF OUR COMMON STOCK AND CAUSE DILUTION TO OUR
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EXISTING STOCKHOLDERS.
- ----------------------
Our existing stockholders will experience substantial dilution of their
investment upon conversion of the Notes and exercise of the Warrants. The Notes
are convertible into shares of our Common Stock at the lesser of $0.90 or 40% of
the average of the three (3) lowest trading prices of our Common Stock during
the twenty (20) trading day period ending one trading day before the date that a
holder sends us notice of conversion. If converted on the Filing Date, the Notes
would be convertible into approximately 6,194,690 shares of Common Stock based
upon a conversion price of $0.113. The number of shares issuable could prove to
be significantly greater in the event of a decrease in the trading price of our
Common Stock that would cause dilution to our existing stockholders. The
Warrants are exercisable into 700,000 shares of Common Stock. The shares of
Common Stock issuable upon conversion or exercise of the Notes or Warrants,
respectively, are being registered in the registration statement to which this
Prospectus is a part. All of the shares of Common Stock offered in this
Prospectus may be sold without restriction after the effectiveness of such
registration statement. The sale of these shares of Common Stock may adversely
affect the market price of our Common Stock. As sequential conversions and sales
take place, the price of our Common Stock may decline and if so, the holders of
Convertible Notes would be entitled to receive an increasing number of shares,
which could then be sold, triggering further price declines and conversions for
even larger numbers of shares, that would cause additional dilution to our
existing stockholders.
The following is an example of the amount of shares of our Common Stock
that are issuable upon conversion of our Notes based on conversion prices that
are 25%, 50% and 75% below the conversion price as of the Filing Date of $0.113.
Percentage Below
Conversion Price Estimated Approximate
as of the Filing Conversion Number of Shares % of Outstanding
Date Price Issuable(1) Common Stock(1)(2)
- ----------------- ----------- ----------------- ------------------
25% $ 0.085 8,959,587 14.3%
50% $ 0.057 13,089,381 19.6%
75% $ 0.028 25,478,761 32.2%
<FN>
(1) Includes shares of Common Stock issuable upon conversion of the Notes
and 700,000 shares of Common Stock issuable upon exercise of the Warrants.
(2) As of the Filing Date, we had 53,560,040 shares of Common Stock issued
and outstanding.
-8-
As illustrated, the number of shares of Common Stock issuable upon conversion of
our Convertible Notes being registered in this Prospectus will increase if the
conversion price of our Common Stock declines, which will cause dilution to our
existing stockholders.
THE CONTINUOUSLY ADJUSTABLE CONVERSION PRICE FEATURE OF OUR CONVERTIBLE NOTES
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MAY ENCOURAGE INVESTORS, INCLUDING THE SELLING SECURITY HOLDERS, TO SHORT SELL
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OUR COMMON STOCK, WHICH COULD HAVE A DEPRESSIVE EFFECT ON THE PRICE OF OUR
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COMMON STOCK.
- -------------
The Convertible Notes are convertible into shares of our Common Stock at
the lesser of $0.90 or 40% of the average of the three (3) lowest trading prices
of our Common Stock during the twenty (20) trading day period ending one trading
day before the date that a holder sends us notice of conversion. The significant
downward pressure on the price of our Common Stock as the Selling Security
Holders convert and sell material amounts of our Common Stock could encourage
investors, including the Selling Security Holders, to short sell our Common
Stock. This could place further downward pressure on the price of our Common
Stock. In addition, not only the sale of shares issued upon conversion of the
Notes or exercise of the Warrants, but also the mere perception that these sales
could occur, may adversely affect the market price of our Common Stock.
WE MUST SATISFY CERTAIN CONDITIONS BEFORE THE SELLING SECURITY HOLDERS ARE
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OBLIGATED TO PURCHASE THE REMAINING $200,000 OF CONVERTIBLE NOTES AND THE
- --------------------------------------------------------------------------------
RELATED WARRANTS.
- ------------------
We sold $500,000 of Convertible Notes and Warrants to purchase 500,000
shares of Common Stock. We also received a commitment to purchase an additional
$200,000 of Convertible Notes and Warrants to purchase 200,000 shares of Common
Stock upon the effectiveness of the registration statement to which the
Prospectus is a part, subject to our satisfaction of additional conditions. The
additional conditions that we must satisfy prior to such purchase by the Selling
Security Holders consist of the following: (i) the Company's representations and
warranties contained in the Agreement are true and correct in all material
respects on the date when made and as of Closing; (ii) the Company shall have
performed, satisfied and complied in al material respects with the covenants,
agreements and conditions required by the Agreement; (iii) there is no
litigation, statute, rule, regulation, executive order, decree, ruling or
injunction that has been enacted, entered, promulgated or endorsed by or in any
court or government authority of competent jurisdiction or any self-regulatory
organization having requisite authority which prohibits the transactions
contemplated by the Agreement; (iv) no event has occurred which could reasonably
be expected to have a material adverse effect on the Company; (v) the shares of
Common Stock issuable upon conversion of the Notes and exercise of the Warrants
have been authorized for quotation on the OTCBB and trading in our Common Stock
on the OTCBB has not been suspended by the SEC or the OTCBB; (vi) the Company
shall provide a legal opinion to the Selling Security Holders; and (vii) the
Company shall provide certain certificates of its officers to the Selling
Security Holders regarding the Company's capitalization, the truth and
correctness of its representations and warranties in the Agreement, the
Company's Articles of Incorporation, Bylaws and Board of Directors' resolutions
relating to the purchase and sale of the remaining Convertible Notes and related
Warrants. If the registration statement is not declared effective or we fail to
satisfy these additional conditions, the Selling Security Holders have no
obligation to purchase the remaining Convertible Notes and related Warrants.
RISKS RELATING TO OUR BUSINESS
WE HAVE A PRESENT NEED FOR CAPITAL IN ADDITION TO $500,000 ALREADY RAISED AND
- --------------------------------------------------------------------------------
A $200,000 COMMITMENT.
- ------------------------
It is imperative that we raise $2 million of financing to support strategic
acquisitions and the current expansion plan for the next 18 to 24 months, which
is in addition to $500,000 already raised and a $200,000 commitment. We
recently received an aggregate of $500,000 of Convertible Note financing from
four (4) unrelated parties. We also received a commitment from these parties to
purchase an additional $200,000 of Convertible Notes. The sale of the additional
Convertible Notes is subject to the satisfaction of certain conditions (as
described above) including the effectiveness of the registration statement to
which this Prospectus is a part. In connection with the Convertible Note
financing, we issued Warrants to purchase 500,000 shares of our Common Stock at
an exercise price of $0.45 per share. We will issue identical Warrants to
purchase 200,000 shares of our Common Stock along with the commitment to
purchase an additional $200,000 of Convertible Notes. At this time, no financing
other than the $200,000 commitment has been secured or identified. Our growth
and continued operations could be impaired by limitations on our access to the
capital markets. There can be no assurance that capital from outside sources
will be available, or if such financing is available, that it will be on terms
that management deems sufficiently favorable. If we are unable to obtain
additional financing upon terms that management deems sufficiently favorable, or
at all, it would have a material adverse impact upon our ability to continue our
business operations and pursue our expansion strategy. In the event we do not
raise additional capital from conventional sources, it is likely that our growth
will be restricted and that we may need to scale back or curtail implementing
our business plan.
-9-
WE HEAVILY DEPEND ON MACDONALD S. TUDEME, MARGUERITE M. TUDEME AND WAYNE F.
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RICHARDSON.
- -----------
The success of the Company heavily depends upon the personal efforts and
abilities of MacDonald S. Tudeme, Wayne F. Richardson, and Marguerite M. Tudeme.
Mr. Tudeme serves as the Company's Chief Executive Officer and its Marketing
Manager, and as a director of the Company. The Company has not entered into an
employment agreement with Mr. Tudeme. Mr. Richardson has entered into an
engagement letter with the Company whereby Mr. Richardson serves as the
Company's Chief Financial Officer. Mr. Richardson also serves as a director of
the Company. Ms. Tudeme serves as the Company's Secretary and its Operations
Manager, and as a director of the Company. The Company has not entered into an
employment agreement with Ms. Tudeme. Mr. Tudeme, Mr. Richardson and Ms. Tudeme
may voluntarily terminate their services at any time. The loss of Mr. Tudeme,
Mr. Richardson, Ms. Tudeme or other key employees could have a material adverse
effect on our business, results of operations or financial condition. In
addition, the absence of Mr. Tudeme, Mr. Richardson or Ms. Tudeme will force us
to seek a replacement who may have less experience or who may not understand our
business as well, or we may not be able to find a suitable replacement.
OUR ABILITY TO OPERATE SUCCESSFULLY AND MANAGE OUR POTENTIAL GROWTH DEPENDS ON
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OUR ABILITY TO ATTRACT AND RETAIN HIGHLY QUALIFIED HEALTHCARE, TECHNICAL,
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MANAGERIAL, SALES, MARKETING, ADMINISTRATIVE AND FINANCIAL PERSONNEL.
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The Company's success heavily depends upon its ability to attract and
retain highly qualified technical, managerial, sales, marketing, administrative
and financial personnel. The Company faces competition for qualified personnel
in these areas. The Company cannot be certain that it will be able to attract
and retain qualified personnel. The Company's inability to hire and retain
additional qualified personnel in the future could have a material adverse
effect on our ability to expand pursuant to our business strategy.
THERE IS A SHORTAGE OF WORKERS IN THE HEALTHCARE INDUSTRY THAT MAY IMPEDE OUR
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ABILITY TO ACQUIRE QUALIFIED HEALTHCARE PROFESSIONALS FOR OUR CONTINUED GROWTH.
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Presently, the healthcare industry is experiencing a growing shortage of
healthcare professionals especially Licensed Practical Nurses and Registered
Nurses. We operate a payroll nurse staffing and homecare business that provides
healthcare professionals such as Certified Nursing Assistants, Nurse
Technicians, Licensed Practical Nurses and Registered Nurses to hospitals,
nursing homes, LHCSAs, other health-related businesses, and to the homes of the
elderly, sick and incapacitated. During the last twelve months, our need for
qualified healthcare professionals grew as we obtained a license from the State
of New York to operate as a LHCSA, established a high tech infusion nursing
department, acquired BP which provides 24-hour healthcare services, and entered
into discussions to acquire other healthcare businesses. One of our major
marketing efforts is to recruit these professionals in the United States and to
attract foreign professionals. There can be no assurance that we will be able
to acquire qualified healthcare professionals within the United States or abroad
to meet our growing needs. If we are not successful in our efforts to acquire
qualified healthcare professionals, it would have a materially adverse effect
upon our ability to expand pursuant to our business strategy.
-10-
GROWTH WILL PLACE SIGNIFICANT STRAINS ON OUR MANAGERIAL, ADMINISTRATIVE AND
- ---------------------------------------------------------------------------
OTHER RESOURCES.
- ----------------
Any growth that we experience is expected to place a significant strain on
our managerial and administrative resources. MacDonald S. Tudeme, Wayne F.
Richardson, and Marguerite M. Tudeme are our only officers. We have limited
employees who perform a management or administrative function. Further, if our
business grows, we will be required to manage multiple relationships with
various clients, healthcare professionals and third parties. These requirements
will exacerbate in the event of further growth. There can be no assurance that
our other resources such as our systems, procedures or controls will be adequate
to support growing operations or that we will be able to achieve the rapid
execution necessary to successfully offer our services and implement our
business plan. Assuming that our business growth, our future success will
depend on our ability to add additional management and administrative personnel
and other resources. If we are unable to add additional managerial and
administrative resources, it will have a material adverse effect on our ability
to expand pursuant to our business strategy.
OUR OPERATIONS AS A LHCSA ARE HEAVILY REGULATED BY THE DEPARTMENT OF HEALTH OF
- --------------------------------------------------------------------------------
THE STATE OF NEW YORK.
- --------------------------
The Department of Health of the State of New York (the "Department")
regulates our operations as a LHCSA. In January 2004, we received a license
from the Department effective December 9, 2003, to operate as a LHCSA in the
five boroughs of New York City and in Nassau County. We were required to
prepare operating manuals as part of the approval process. Home healthcare
licensure requires us to make sure that our staff is appropriately qualified,
trained and supervised to provide skilled, in-home healthcare services. We will
be subject to unannounced surveys to assess our compliance with state and
federal standards governing the quality and scope of the services that we
provide. If we fail to comply with the government regulations, it could have a
materially adverse effect on our business (including the revocation of our
license as a LHCSA), results of operations and financial condition.
OUR INDUSTRY IS HIGHLY FRAGMENTED AND COMPETITIVE.
- --------------------------------------------------
The medical staffing industry is both highly fragmented and highly
competitive. There are a large number of firms engaged in the provision of
medical personnel. A significant number of these companies are small
competitors operating on a localized basis. There are, however, a few larger
companies that operate on a national basis. We believe that our marketing
approach along with our methods for identifying skilled personnel provide us
with a competitive advantage in our industry. If we are unable to realize a
competitive advantage, it would have a material adverse effect on our business,
results of operations and financial condition.
MACDONALD S. TUDEME, WAYNE F. RICHARDSON AND MARGUERITE M. TUDEME CAN VOTE AN
- -----------------------------------------------------------------------------
AGGREGATE OF 67.5% OF OUR COMMON STOCK AND CAN EXERCISE CONTROL OVER CORPORATE
- ------------------------------------------------------------------------------
DECISIONS.
- ----------
MacDonald S. Tudeme, Wayne F. Richardson and Marguerite M. Tudeme can vote
an aggregate of 36,173,520 shares (or 67.5%) of our outstanding Common Stock.
Accordingly, Mr. Tudeme, Mr. Richardson and Ms. Tudeme will exercise control in
determining the outcome of all corporate transactions or other matters,
including the election of directors, mergers, consolidations, the sale of all or
substantially all of our assets, and also the power to prevent or cause a change
in control. The interests of Mr. Tudeme, Mr. Richardson and Ms. Tudeme may
differ from the interests of the other stockholders and thus result in corporate
decisions that are adverse to other shareholders.
-11-
A DEFAULT BY US UNDER THE CONVERTIBLE NOTES WOULD ENABLE THE HOLDERS OF THE
- --------------------------------------------------------------------------------
CONVERTIBLE NOTES TO TAKE CONTROL OF SUBSTANTIALLY ALL OF OUR ASSETS.
- -------------------------------------------------------------------------------
The Convertible Notes are secured by security agreements under which we
pledged substantially all of our assets including our equipment, inventory,
contract rights, receivables, general intangibles, and intellectual property. A
default by us under the Convertible Notes would enable the holders to take
control of substantially all of our assets. The holders of the Convertible Notes
have no operating experience in our industry that could force us to
substantially curtail or cease our operations.
THE CONVERTIBLE NOTES BECOME IMMEDIATELY DUE AND PAYABLE UPON DEFAULT AND WE MAY
- --------------------------------------------------------------------------------
BE REQUIRED TO PAY AN AMOUNT IN EXCESS OF THE OUTSTANDING AMOUNT OF THE NOTES
- -----------------------------------------------------------------------------
AND ACCRUED AND UNPAID INTEREST ON THE NOTES.
- ---------------------------------------------
The Notes become immediately due and payable upon an event of default
including, among other things, failure to pay principal and interest, failure to
convert the Notes to Common Stock, failure to obtain effective of the
registration statement to which this Prospectus is a part within one hundred
sixty (160) days following Closing, assignment for the benefit of the Company's
or its subsidiaries' creditors, application for or consent to the appointment of
a receiver for the Company or its subsidiaries, judgments against the Company in
excess of $50,000, and bankruptcy, insolvency, reorganization or liquidation
proceedings instituted by or against the Company or its subsidiaries. In
addition, the Company would be required to pay the holders of the Notes an
amount equal to the greater of 130% times the sum of the outstanding amount of
the Notes per month plus accrued and unpaid interest on the Notes plus
additional amounts owed to the holders of the Notes under the Agreement and
related documents (the "Default Sum") or the value of the highest number of
shares of Common Stock issuable upon conversion of or otherwise pursuant to such
Default Sum determined based on the highest closing price of the Common Stock
during the period beginning on the date of default and ending on the date of the
payment described herein. If we default on the Notes, it would have a material
adverse effect on our business, results of operations and financial condition.
WE MAY BE SUBJECT TO LIQUIDATED DAMAGES IN THE AMOUNT OF 3% OF THE OUTSTANDING
- ------------------------------------------------------------------------------
AMOUNT OF THE NOTES PER MONTH PLUS ACCRUED AND UNPAID INTEREST ON THE NOTES FOR
- -------------------------------------------------------------------------------
BREACHES BY US OF OUR REPRESENTATIONS AND WARRANTIES AND CERTAIN COVENANTS UNDER
- --------------------------------------------------------------------------------
THE SECURITIES PURCHASE AGREEMENT.
- ----------------------------------
We made certain representations and warranties and agreed to certain
covenants that are customary for securities purchase agreements. In the event
that we breach those representations, warranties or covenants, we will be
subject to liquidated damages in the amount of 3% of the outstanding amount of
the Notes per month plus accrued and unpaid interest on the Notes for such
breaches. As of the Filing Date, the outstanding amount of the Notes was
$500,000 and accrued and unpaid interest on the Notes was approximately $4,167.
If we are subject to liquidated damages for breach of the representations,
warranties or covenants, it would have a material adverse effect on our
business, results of operations and financial condition.
WEARE ACTIVELY SEEKING TO ACQUIRE COMPANIES RELATED TO OUR BUSINESS OPERATIONS,
- -------------------------------------------------------------------------------
BUT OUR EFFORTS MAY NOT MATERIALIZE INTO DEFINITIVE AGREEMENTS.
- ---------------------------------------------------------------
In July 2004, the Company entered into negotiations to acquire medical
staffing companies as part of its expansion strategy outside of the New York
City metropolitan area. There can be no assurance that we will come to
definitive terms with respect to these negotiations, or, assuming that we reach
definitive agreements, that we will close the planned acquisitions. In the
event that we do not reach definitive agreements or close the planned
acquisitions, our expansion strategy will not proceed as intended which will
have a material adverse effect on our growth.
WE ENTERED INTO AN AGREEMENT TO ACQUIRE ABUNDANT NURSING, INC. WHICH
- ----------------------------------------------------------------------------
ACQUISITION IS CONTINGENT ON US SATISFYING OUR OBLIGATIONS UNDER A $295,000
- ------------------------------------------------------------------------
PROMISSORY NOTE.
- ----------------
In October 2004, we entered into an agreement to acquire Abundant Nursing,
Inc. in exchange for $150,000 paid on October 1, 2004 and a $295,000 promissory
note payable in five (5) years at seven percent (7%) interest per annum. Our
acquisition of Abundant is contingent on our paying the $295,000 as
contemplated. In addition, we pledged all of the common stock of Abundant to
secure our performance under the promissory note. Until
we have fully paid $295,000 due under the promissory note, we are required to
keep Abundant as a separate Pennsylvania corporation, including without
limitation, no merger or consolidation of Abundant with MT Ultimate Healthcare
Corp., and maintain the separate assets of Abundant as they existed on October
1, 2004. In addition, we may not issue, sell or transfer any stock of Abundant
or permit or allow any liens on the assets of Abundant until we have paid the
$295,000 due under the promissory note. In the event that we do not satisfy
our obligations under the $295,000 promissory note and related agreements, the
former shareholder of Abundant may take control over Abundant. In such event,
we will not receive a credit for the $150,000 that we paid on October 1, 2004.
RISKS RELATING TO OUR COMMON STOCK
- ----------------------------------
THE MARKET PRICE OF OUR COMMON STOCK HISTORICALLY HAS BEEN VOLATILE.
- --------------------------------------------------------------------
The market price of our Common Stock historically has fluctuated
significantly based on, but not limited to, such factors as: general stock
market trends, announcements of developments related to our business, actual or
anticipated variations in our operating results, our ability or inability to
generate new revenues, conditions and trends in the event production industry
and in the industries in which our customers are engaged.
Our Common Stock is traded on the Nasdaq OTCBB. In recent years the stock
market in general has experienced extreme price fluctuations that have
oftentimes have been unrelated to the operating performance of the affected
companies. Similarly, the market price of our Common Stock may fluctuate
significantly based upon factors unrelated or disproportionate to our operating
performance. For example, the fifty-two (52) week high for our Common Stock was
$2.55 on February 20, 2004, as compared to the fifty-two (52) low of $0.28 on
September 13, 2004. These market fluctuations, as well as general economic,
political and market conditions, such as recessions, interest rates or
international currency fluctuations may adversely affect the market price of our
Common Stock.
-12-
OUR COMMON STOCK IS SUBJECT TO THE"PENNY STOCK" RULES OF THE COMMISSION WHICH
- -----------------------------------------------------------------------------
LIMITS THE TRADING MARKET IN OUR COMMON STOCK, MAKES TRANSACTIONS IN OUR COMMON
- -------------------------------------------------------------------------------
STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN INVESTMENT IN OUR COMMON STOCK.
- -------------------------------------------------------------------------------
Our Common Stock is considered a "penny stock" as defined in Rule 3a51-1
promulgated by Commission under the Securities Exchange Act of 1934. In
general, a security which is not quoted on NASDAQ or has a market price of
less than $5 per share where the issuer does not have in excess of $2,000,000
in net tangible assets (none of which conditions the Company meets) is
considered a penny stock. The Commission's Rule 15g-9 regarding penny stocks
impose additional sales practice requirements on broker-dealers who sell such
securities to persons other than established customers and accredited investors
(generally persons with net worth in excess of $1,000,000 or an annual income
exceeding $200,000 or $300,000 jointly with their spouse). For transactions
covered by the rules, 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. Thus, the rules affect the ability of
broker-dealers to sell our Common Stock should they wish to do so because of the
adverse effect that the rules have upon liquidity of penny stocks. Unless the
transaction is exempt under the rules, under the Securities Enforcement
Remedies and Penny Stock Reform Act of 1990, broker-dealers effecting customer
transactions in penny stocks are required to provide their customers with (i)
a risk disclosure document; (ii) disclosure of current bid and ask quotations if
any; (iii) disclosure of the compensation of the broker-dealer and its sales
personnel in the transaction; and (iv) monthly account statements showing the
market value of each penny stock held in the customer's account. As a result of
the penny stock rules the market liquidity for our Common Stock may be
adversely affected by limiting the ability of broker-dealers to sell our Common
Stock and the ability of purchasers to resell our Common Stock.
In addition, various state securities laws impose restrictions on
transferring "penny stocks" and as a result, investors in the Common Stock may
have their ability to sell their shares of the Common Stock impaired.
THE COMPANY HAS NOT PAID ANY CASH DIVIDENDS.
- --------------------------------------------
The Company has paid no cash dividends on its Common Stock to date and
it is not anticipated that any cash dividends will be paid to holders of the
Company's Common Stock in the foreseeable future. While the Company's dividend
policy will be based on the operating results and capital needs of the business,
it is anticipated that any earnings will be retained to finance the future
expansion of the Company.
-13-
OUR ARTICLES OF INCORPORATION, AS AMENDED, AND/OR BYLAWS LIMIT THE LIABILITY OF,
- --------------------------------------------------------------------------------
AND/OR PROVIDE INDEMNIFICATION FOR, OUR OFFICERS AND DIRECTORS.
- ---------------------------------------------------------------
Our Articles of Incorporation, as amended, and Bylaws provide for
indemnification from liability of our officers and directors to the fullest
extent permitted by Nevada General Corporation Law ("Nevada Law"), including
future amendments to Nevada Law. Nevada Law generally provides that we may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (hereinafter a "Proceeding") by
reason of the fact that the person is or was a director, officer, employee or
agent of the Company, or is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses, including attorneys' fees,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by the person in connection with the Proceeding upon a determination by our
stockholders, a majority of our disinterested directors or independent legal
counsel that indemnification is proper in the circumstances, provided that: a)
the it is not proven that the person's act or failure to act constituted a
breach of the person's fiduciary duties as an officer or director, and the
person's breach of those duties involved intentional misconduct, fraud or a
knowing violation of law (the "Provision for Limited Liability"); or b) the
person acted in good faith and in a manner which the person reasonably believed
to be in or not opposed to the best interests of the Company, and, with respect
to any criminal action or proceeding, the person had no reasonable cause to
believe that the person's conduct was unlawful. Such an indemnification payment
might deplete the Company's assets. Stockholders who have questions respecting
the fiduciary obligations of the officers and directors of the Company should
consult with independent legal counsel. It is the position of the Securities and
Exchange Commission that exculpation from and indemnification for liabilities
arising under the 1933 Act and the rules and regulations thereunder is against
public policy and therefore unenforceable. See the section entitled "Disclosure
of Commission Position of Indemnification for Securities Act Liabilities".
Nevada Law also generally limits the liability of our officers and directors for
any damages as a result of any act or failure to act in the officer's or
director's capacity as an officer or director subject to the Provision for
Limited Liability. Thus, the Company may be prevented from recovering damages
for certain alleged errors or omissions by the officers and directors for
liabilities incurred in connection with their good faith acts for the Company.
You should carefully consider the above risk factors and warnings before
making an investment decision. The risks described above are not the only ones
facing us. Additional risks that we do not yet know of or that we currently
think are not material may also have an adverse effect on our business
operations. If any of those risks or any of the risks described above actually
occur, our business could be adversely affected. In that case, the price of our
Common Stock could decline, and you could lose all or part of your investment.
You should also refer to the other information set forth or incorporated by
reference in this Prospectus.
FORWARD-LOOKING STATEMENTS
--------------------------
This Prospectus contains forward-looking statements within the meaning of
Section 27A of the Securities Act, and Section 21E of the Securities Exchange
Act of 1934 (the "Exchange Act"). We have based these forward-looking
statements on our current expectations and projections about future events.
These forward-looking statements are subject to known and unknown risks,
uncertainties and assumptions about us that may affect our actual results,
levels of activity, performance, or achievements expressed or implied by such
forward-looking statements. These factors are discussed in the section entitled
"RISK FACTORS". In some cases you can identify forward-looking statements by
terminology such as "may", "should", "could", "would", "expect", "plan",
"anticipate", "believe", "estimate", "continue", or the negative of such terms
or other similar expressions. All forward-looking statements attributable to us
or persons acting on our behalf are expressly qualified in their entirety by the
cautionary statements included in this Prospectus. We undertake no obligation
to publicly update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise. In light of these risks,
uncertainties and assumptions, the forward-looking events discussed in this
Prospectus might not occur.
USE OF PROCEEDS
---------------
This Prospectus relates to shares of Common Stock that the Company may
issue upon conversion of $700,000 of Convertible Notes. The Common Stock
issuable upon conversion of the Convertible Notes may be offered and sold from
time to time by the Selling Security Holders. We will not receive any proceeds
from the resale of such Common Stock by the Selling Security Holders. As of the
date of this Prospectus, however, the Company sold $500,000 of the Convertible
Notes. The Company has agreed to sell an additional $200,000 in Convertible
Notes (subject to the Company's satisfaction of certain conditions as described
in the section entitled "RISK FACTORS") upon the effectiveness of a registration
statement under the Securities Act.
-14-
This Prospectus also relates to shares of Common Stock that the Company may
issue upon exercise of the Warrants. As of the date of this Prospectus, the
Company issued Warrants to purchase 500,000 shares of our Common Stock at an
exercise price of $0.45 per share. The Common Stock underlying the Warrants may
be offered and sold from time to time by the Warrant holders. We will not
receive any proceeds from the resale of our Common Stock underlying the
Warrants. The Company will, however, receive proceeds upon the exercise of the
Warrants.
The Company will use the proceeds from the exercise of Warrants for working
capital in support of growing its business operations.
DIVIDEND POLICY
---------------
We have not in the past paid any dividends on our Common Stock. We do not
anticipate that any cash dividends will be paid to holders of the Company's
Common Stock in the foreseeable future. We anticipate that we will retain any
future earnings for use in the expansion and operation of our business. Any
determination to pay dividends will depend upon our financial condition, results
of operations and capital requirements.
SELLING SECURITY HOLDERS
------------------------
On the date of this offering, the Company has 53,560,040 shares of Common
Stock outstanding. This Prospectus relates to the resale of 13,789,380 shares
of Common Stock by the Selling Security Holders. The Selling Security Holders
are "underwriters" within the meaning of Section 2(a)(11) of the Securities Act
of 1933 (the "Securities Act" or the "1933 Act"). Upon the effectiveness of a
registration statement pursuant to the Securities Act to which this Prospectus
is a part, all 13,789,380 shares of Common Stock will be freely tradable without
restriction or further registration under the Securities Act. Sales of a
substantial number of shares of the Company's Common Stock in the public market
following this offering could adversely affect the market price of the Common
Stock.
The table below sets forth information with respect to the resale of shares
of Common Stock by the Selling Security Holders. We will not receive any
proceeds from the resale of Common Stock by the Selling Security Holders. We
will receive proceeds from the exercise of the Warrants.
Shares of
Common Stock Common Beneficial
Beneficially Stock Included Ownership Percentage
Owned Before in this After the Owned After
Name(1) the Offering Prospectus(2) Offering(3) the Offering (3)
- -------------------------------------------- -------------- ------------- ----------- ----------------
AJW Partners, LLC (4) 2,206,301 (5) 2,206,301 0 --
AJW Offshore, Ltd. (6) 5,102,071 (7) 5,102,071 0 --
AJW Qualified Partners, LLC (8) 6,067,327 (9) 6,067,327 0 --
New Millennium Capital Partners II, LLC (10) 413,681 (11) 413,681 0 --
The number and percentage of shares beneficially owned is determined in
accordance with Rule 13d-3 of the Securities Exchange Act of 1934, and the
information is not necessarily indicative of beneficial ownership for any other
purpose. Under such rule, beneficial ownership includes any shares as to which
the selling security holder has sole or shared voting power or investment power
and also any shares, which the selling security holder has the right to acquire
within 60 days. Shares of Common Stock subject to a Convertible Note or Warrant
currently convertible or exercisable, or convertible or exercisable within 60
days are deemed outstanding for computing the percentage of the selling security
holder holding such Convertible Note or Warrant, but are not deemed outstanding
for computing the percentage of any other person.
-15-
(1) The Selling Security Holders do not hold any position or office, and
have not had any material relationship with the Company or any of its affiliates
within the past three (3) years.
(2) Includes 200% of the shares issuable upon conversion of the principal
amount of the Convertible Notes and exercise of the Warrants to take into
account the conversion of accrued interest and other charges including potential
liquidated damages. In addition to the shares of Common Stock set forth in the
table, the amount to be registered also covers such indeterminate number of
additional shares of Common Stock as may become issuable upon conversion of or
otherwise pursuant to the Notes and exercise of the Warrants to prevent dilution
resulting from stock splits, stock dividends, or similar transactions in
accordance with Rule 416. Because the number of shares of common stock issuable
upon conversion of the Convertible Notes is dependent in part upon the market
price of our Common Stock prior to a conversion, the actual number of shares of
Common Stock that will be issued upon conversion will fluctuate daily and cannot
be determined at this time. However the Selling Security Holders have
contractually agreed to restrict their ability to convert their Notes or
exercise their Warrants and receive shares of our Common Stock such that the
number of shares of Common Stock held by each of them individually and their
affiliates after such conversion or exercise does not exceed 4.9% of the then
issued and outstanding shares of Common Stock.
(3) Assumes that all Common Stock registered will be sold.
(4) AJW Partners, LLC is a private investment fund that is owned by its
investors and managed by SMS Group, LLC. SMS Group, LLC, of which Mr. Corey S.
Ribotsky is the fund manager and has voting and investment control over the
shares offered by AJW Partners, LLC.
(5) Includes 1,982,301 shares (or 200% of the shares) issuable upon
conversion of Convertible Notes, and 224,000 shares (or 200% of the shares)
issuable upon exercise of Warrants.
(6) AJW Offshore, Ltd is a private investment fund that is owned by its
investors and managed by First Street Manager II, LLC. First Street Manager II,
LLC, of which Corey S. Ribotsky is the fund manager and has voting and
investment control over the shares offered by AJW Offshore, Ltd.
(7) Includes 4,584,071 shares (or 200% of the shares) issuable upon
conversion of Convertible Notes, and 518,000 shares (or 200% of the shares)
issuable upon exercise of Warrants.
(8) AJW Qualified Partners, LLC is a private investment fund that is owned
by its investors and managed by AJW Manager, LLC, of which Corey S. Ribotsky and
Lloyd A. Groveman are the fund managers and have voting and investment control
over the shares offered by AJW Qualified Partners, LLC.
(9) Includes 5,451,327 shares (or 200% of the shares) issuable upon
conversion of Convertible Notes, and 616,000 shares (or 200% of the shares)
issuable upon exercise of Warrants.
(10) New Millennium Capital Partners II, LLC is a private investment fund
that is owned by its investors and managed by First Street Manager II, LLP.
First Street Manager II, LLP, of which Corey S. Ribotsky is the fund manager and
has voting and investment control over the shares offered by New Millennium
Capital Partners II, LLC.
(11) Includes 371,681 shares (or 200% of the shares) issuable upon
conversion of Convertible Notes, and 42,000 shares (or 200% of the shares)
issuable upon exercise of Warrants.
-16-
PLAN OF DISTRIBUTION
--------------------
The Selling Security Holders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of Common Stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The Selling Security Holders may use any one or more of the
following methods when selling shares:
-- ordinary brokerage transactions and transactions in which the
broker-dealer solicits the purchaser;
-- block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
-- purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
-- an exchange distribution in accordance with the rules of the
applicable exchange;
-- privately-negotiated transactions;
-- broker-dealers may agree with the Selling Security Holders to sell a
specified number of such shares at a stipulated price per share;
-- a combination of any such methods of sale; and
-- any other method permitted pursuant to applicable law.
The Selling Security Holders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this Prospectus.
The Selling Security Holders may pledge their shares to their brokers under
the margin provisions of customer agreements. If a selling security holder
defaults on a margin loan, the broker may, from time to time, offer and sell the
pledged shares.
The Selling Security Holders may sell their shares of Common Stock short
and redeliver our Common Stock to close out such short positions; however, the
Selling Security Holders may not use shares of our Common Stock being registered
in the registration statement to which this Prospectus is a part to cover any
short positions entered into prior to the effectiveness of such registration
statement. As discussed above in the section entitled "RISK FACTORS", if the
Selling Security Holders or others engage in short selling it may adversely
affect the market price of our Common Stock.
Broker-dealers engaged by the Selling Security Holders may arrange for
other broker-dealers to participate in sales. Broker-dealers may receive
commissions or discounts from the Selling Security Holders (or, if any
broker-dealer acts as agent for the purchaser of shares, from the purchaser) in
amounts to be negotiated. The Selling Security Holders do not expect these
commissions and discounts to exceed what is customary in the types of
transactions involved.
In addition, the Selling Security Holders should be aware that the
anti-manipulation provisions of Regulation M under the Securities Exchange Act
of 1934 will apply to purchases and sales of shares of Common Stock by the
Selling Security Holders and that there are restrictions on market-making
activities by persons engaged in the distribution of the shares. Under
Regulation M, the Selling Security Holders or their agents may not bid for,
purchase, or attempt to induce any person to bid for or purchase, shares of our
Common Stock while they are distributing shares covered by this Prospectus.
Accordingly, the Selling Security Holders are not permitted to cover short sales
by purchasing shares while the distribution is taking place. We will advise the
Selling Security Holders that if a particular offer of Common Stock is to be
made on terms materially different from the information set forth in this Plan
of Distribution, then a post-effective amendment to the accompanying
registration statement must be filed with the Securities and Exchange
Commission.
The Selling Security Holders may be deemed to be an "underwriter" within
the meaning of the Securities Act in connection with such sales. In such event,
any commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.
We are required to pay all fees and expenses incident to the registration
of the shares, including fees and disbursements of counsel to the Selling
Security Holders, but excluding brokerage commissions or underwriter discounts.
We and the Selling Security Holders have agreed to indemnify each other against
certain losses, claims, damages and liabilities, including liabilities under the
Securities Act.
-17-
LEGAL PROCEEDINGS
-----------------
The Company is not a party to, and its properties are not the subject
of, any other pending legal proceeding.
DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
------------------------------------------------------------
The Directors and Officers of the Company are as follows:
Name Age Position Since
- -------------------- --- ---------------------------------------------------------- ------------
MacDonald S. Tudeme 57 Chief Executive Officer, President, Treasurer and Director August 2003
Wayne F. Richardson 49 Chief Financial Officer and Director October 2003
Marguerite M. Tudeme 49 Secretary and Director August 2003
MacDonald S. Tudeme began serving as the Company's Chief Executive Officer
and as a Director in connection with the Company's acquisition of MT in August
2003. Mr. Tudeme concurrently serves as the Chief Executive Officer of MT. He
has held his position at MT since 1997. From August 1998 to August 2003, Mr.
Tudeme was also Program Director for Heritage Health and Housing, Inc. In 1995,
Mr. Tudeme received a Masters degree in Business Policy Studies from City
University (Los Angeles). In 1976, Mr. Tudeme received a diploma in Industrial
Administration from Aston University in Birmingham, England. In 1974, he
received a Bachelors degree in Business Administration from Calgary College of
Technology. Mr. Tudeme attended City College of New York where he completed
specialized education as a Credentialed Alcohol and Substance Abuse Counselor.
Mr. Tudeme is a member of the British Institute of Marketing. Mr. Tudeme and
Marguerite Tudeme, our Secretary and a Director, are husband and wife.
Wayne F. Richardson began serving as the Company's Chief Financial Officer
in October 2003 pursuant to an engagement letter with the Company, and as a
Director in December 2003. Concurrently with his position with the Company, Mr.
Richardson serves as Principal of Rauceo Tax Service and as a Consultant for
J.H. Floyd Sunshine Manor, Inc. Mr. Richardson has held his position at Rauceo
Tax Service since January 2003 and at J.H. Floyd Sunshine Manor, Inc. since
February 1, 2004. Mr. From July 2002 to August 2003, Mr. Richardson served as an
independent accountant for MT. From June 2002 to January 2003, Mr. Richardson
served s a Consultant for Heritage Health & Housing, Inc. From September 2001 to
May 2002, Mr. Richardson served as Tax Supervisor for Karkaring & Barbaro, CPAs.
From September 1997 to June 2001, Mr. Richardson served as a Senior Accountant
for John Trent CPAs. Mr. Richardson received a Bachelors degree in Accounting
from York College, The City University of New York ("CUNY"). Mr. Richardson
received a Masters degree in Taxation from Baruch College, CUNY. Mr. Richardson
is a licensed CPA in the States of New York and Florida.
-18-
Marguerite M. Tudeme began serving as the Company's Secretary and as a
Director in connection with the Company's acquisition of MT in August 2003. Ms.
Tudeme concurrently serves as the Secretary of MT. She has held her position at
MT since 1997. From November 1997 to 1999, Ms. Tudeme was a Supervisor for
Heritage Health and Housing, Inc. In 1994, Ms. Tudeme received a Bachelors
degree in Human Service from Audrey Cohen College. Ms. Tudeme is a member of the
National Association for Female Executives, the Nigerian Nurse Association and
the League of Nigerian Women. Ms. Tudeme and MacDonald Tudeme, our Chief
Executive Officer and a Director, are wife and husband.
All Directors of the Company will hold office until the next annual meeting
of the shareholders, and until their successors have been elected and qualified.
Officers of the Company are elected by the Board of Directors and hold office at
the pleasure of the Board.
ENGAGEMENT LETTER
Wayne F. Richardson serves as the Company's Chief Financial Officer and as
a director of the Company pursuant to an engagement letter effective October 1,
2004, for a period of twelve (12) months. Mr. Richardson will receive $57,000
as compensation. The Company will reimburse Mr. Richardson for his expenses
including travel expense. Mr. Richardson and the Company may terminate the
engagement letter at any time by any form of written notice including email.
The engagement letter limits Mr. Richardson's liability for damages to the total
amount paid by the Company for services thereunder.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
--------------------------------------------------------------
The following table sets forth information as of October 1, 2004, with
respect to the beneficial ownership of the common stock by (i) each director and
officer of the Company, (ii) all directors and officers as a group and (iii)
each person known by the Company to own beneficially 5% or more of the common
stock:
Name and Address
of Beneficial Owners Shares of Common Stock Beneficially Owned (1)
- ---------------------------
Number Percent
--------------------------------------------- --------
MacDonald S. Tudeme 35,973,520 (2) 67.2%
45 Main Street, Suite 617
Brooklyn, New York 11201
Marguerite M. Tudeme 35,973,520 (2) 67.2%
45 Main Street, Suite 617
Brooklyn, New York 11201
Wayne F. Richardson 200,000 *
5819 Milton Avenue
Sarasota, Florida 34243
All officers and directors 36,173,520 (2) 67.5%
as a group (3 people)
* Less than 1%.
<FN>
(1) The number of shares of Common Stock owned are those "beneficially
owned" as determined under the rules of the Securities and Exchange Commission,
including any shares of Common Stock as to which a person has sole or shared voting
or investment power and any shares of Common Stock which the person has the right
to acquire within 60 days through the exercise of any option, warrant or right.
Shares of Common Stock subject to a Convertible Note or Warrant currently
convertible or exercisable, or convertible or exercisable within 60 days are deemed
outstanding for computing the percentage of the person holding such Convertible Note
or Warrant, but are not deemed outstanding for computing the percentage of any other
person. As of October 4, 2004 there were 53,560,040 shares of Common Stock
outstanding.
(2) MacDonald Tudeme and Marguerite Tudeme are husband and wife. This amount is
the sum of 28,834,900 shares owned by Mr. Tudeme, 7,067,920 shares owned by Ms.
Tudeme, 35,340 shares owned by their son Phil Tudeme, 17,680 shares owned by their
daughter Sandra Tudeme, and 17,680 shares owned by their son Sonny Tudeme. In
connection with the Agreement, Mr. Tudeme pledged 5,700,000 shares of Common Stock
owned by him as collateral to guarantee the due and punctual performance by the
Company and payment of the Company's obligations under the Agreement and related
documents.
-19-
DESCRIPTION OF SECURITIES
-------------------------
THE FOLLOWING DESCRIPTION OF OUR CAPITAL STOCK IS A SUMMARY AND IS QUALIFIED IN
ITS ENTIRETY BY THE PROVISIONS OF OUR ARTICLES OF INCORPORATION, AS AMENDED,.
COMMON STOCK
Our Articles of Incorporation, as amended, authorize the issuance of
400,000,000 shares of Common Stock, $.001 par value per share, and no shares of
preferred stock. Holders of shares of Common Stock are entitled to one vote for
each share on all matters to be voted on by the stockholders. Holders of Common
Stock do not have cumulative voting rights. Holders of shares of Common Stock
are entitled to share ratably in dividends, if any, as may be declared, from
time to time by the Board of Directors in its discretion, from funds legally
available therefor. In the event of a liquidation, dissolution, or winding up of
the Company, the holders of shares of Common Stock are entitled to share pro
rata all assets remaining after payment in full of all liabilities. Holders of
Common Stock have no preemptive or other subscription rights, and there are no
conversion rights or redemption or sinking fund provisions with respect to such
shares.
CONVERTIBLE NOTES AND WARRANTS
To obtain funding for our ongoing operations we entered into the Agreement
with Partners, Offshore, Qualified and New Millennium in August 2004, for the
sale of (i) an aggregate of $700,000 Convertible Notes that, as of the Filing
Date, were convertible into approximately 6,194,690 shares of Common Stock at
$0.113 per share; and (ii) Warrants to purchase 700,000 shares of Common Stock
at $0.45 per share. As of the date of this Prospectus, the Selling Security
Holders have purchased, and the Company has issued, an aggregate principal
amount of $500,000 of the Convertible Notes which, as of the Filing Date, were
convertible into an aggregate of approximately 4,424,779 shares of Common Stock.
The Company has issued Warrants to purchase 500,000 shares of Common Stock. The
Company issued these securities on August 31, 2004. The Company and the Selling
Security Holders have an agreement whereby upon the effectiveness of the
registration statement to which this Prospectus is a part, the Selling Security
Holders have five (5) days to purchase an aggregate of $200,000 of identical
Convertible Notes (subject to the Company's satisfaction of certain conditions
described in the section entitled "RISK FACTORS") which, assuming a $0.113
conversion price per share, would be convertible into an aggregate of
approximately 1,769,911 shares of Common Stock, and identical Warrants to
purchase an aggregate of 200,000 shares of Common Stock at an exercise price of
$0.45 per share.
-20-
The conversion price for the Notes is determined at the time of conversion
and is calculated as the lesser of the Variable Conversion Price (as defined in
the Note) or $0.90. The Variable Conversion Price is average of the three (3)
lowest trading prices of the Company's Common Stock during the twenty (20)
trading day period ending one trading day before the date that a holder of a
Note sends notice of conversion to the Company. The Company may call all of the
Notes for an amount in cash equal to either (i) 130% (for prepayments occurring
within thirty (30) days of the Closing), (ii) 140% for prepayments occurring
between thirty-one (31) and ninety (90) days of Closing, or (iii) 150% (for
prepayments occurring after the ninetieth (90th) day following Closing),
multiplied by the sum of the then outstanding principal and accrued and unpaid
interest. The Convertible Notes have a two-year term and bear interest at a
rate of 10% per annum. The holder of a Note may not convert any portion of the
Note in excess of that portion of the Note upon conversion of which the sum of
(i) the number of shares of Common Stock beneficially owned by the holder and
its affiliates (other than shares of Common Stock which may be deemed
beneficially owned through the ownership of the unconverted portion of the Notes
or the unexercised or unconverted portion of any other security of the Company
(including, without limitation, the Warrants) subject to a limitation on
conversion or exercise analogous to the limitations described in this paragraph)
and; (ii) the number of shares of Common Stock issuable upon the conversion of
the portion of the Note with respect to which the determination of the
limitation described in this paragraph is being made, would result in
beneficial ownership by the holder and its affiliates of more than 4.9% of the
outstanding shares of Common Stock (the "4.9% Limitation"). The holder of a
Warrant is subject to the 4.9% Limitation with respect to exercise of the
Warrants.
The Notes become immediately due and payable upon an event of default
including, among other things, failure to pay principal and interest, failure to
convert the Notes to Common Stock, failure to obtain effective of the
registration statement to which this Prospectus is a part within one hundred
sixty (160) days following Closing, assignment for the benefit of the Company's
or its subsidiaries' creditors, application for or consent to the appointment of
a receiver for the Company or its subsidiaries, judgments against the Company in
excess of $50,000, and bankruptcy, insolvency, reorganization or liquidation
proceedings instituted by or against the Company or its subsidiaries. In
addition, the Company would be required to pay the holders of the Notes an
amount equal to the greater of 130% times the sum of the outstanding amount of
the Notes per month plus accrued and unpaid interest on the Notes plus any
additional amounts owed to the holders of the Notes (the "Default Sum") or the
value of the highest number of shares of Common Stock issuable upon conversion
of or otherwise pursuant to such Default Sum determined based on the highest
closing price of the Common Stock during the period beginning on the date of
default and ending on the date the payment described herein. We made certain
representations and warranties and agreed to certain covenants that are
customary for securities purchase agreements. In the event that we breach those
representations, warranties or covenants, we will be subject to liquidated
damages in the amount of 3% of the outstanding amount of the Notes per month
plus accrued and unpaid interest on the Notes for breaches by us of certain
representations, warranties and certain covenant provided therein. We may call
the Notes at a premium upon certain conditions.
In connection with the Agreement, MacDonald S. Tudeme, our Chief Executive
Officer, pledged 5,700,000 shares of Common Stock owned by him as collateral to
guarantee the due and punctual performance and payment of our obligations under
the Agreement and related documents. We granted the Selling Security Holders a
continuing, first priority security interest in our general assets (the
"Security Agreement") and our intellectual property (the "Intellectual Property
Security Agreement").
LEGAL MATTERS
-------------
David M. Loev, Attorney at Law, Houston, Texas, the Company's corporate
counsel, will give an opinion on the validity of the shares of Common Stock
being registered and offered in this Prospectus or other matters concerning such
registration and offering.
EXPERTS
-------
The audited financial statements as of December 31, 2002 and 2003 included
in this Prospectus have been included in reliance on the report of Clyde Bailey,
P.C., Certified Public Accountant, given as an expert in accounting and
auditing.
-21-
DISCLOSURE OF COMMISSION POSITION OF INDEMNIFICATION FOR
--------------------------------------------------------
SECURITIES ACT LIABILITIES
--------------------------
Our Articles of Incorporation, as amended, and Bylaws provide for
indemnification from liability of our officers and directors to the fullest
extent permitted by Nevada Law, including future amendments to Nevada Law.
Nevada Law generally provides that we may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed Proceeding by reason of the fact that the person is or was a director,
officer, employee or agent of the Company, or is or was serving at the request
of the Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses,
including attorneys' fees, judgments, fines and amounts paid in settlement
actually and reasonably incurred by the person in connection with the Proceeding
upon a determination by our stockholders, a majority of our disinterested
directors or independent legal counsel that indemnification is proper in the
circumstances, provided that: a) it is not proven that the person's act or
failure to act constituted a breach of the person's fiduciary duties as an
officer or director, and the person's breach of those duties involved
intentional misconduct, fraud or a knowing violation of law; or b) the person
acted in good faith and in a manner which the person reasonably believed to be
in or not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, the person had no reasonable cause to believe
that the person's conduct was unlawful. Nevada Law also generally limits the
liability of our officers and directors for any damages as a result of any act
or failure to act in the officer's or director's capacity as an officer or
director provided that: a) it is not proven that the person's act or failure to
act constituted a breach of the person's fiduciary duties as an officer or
director, and the person's breach of those duties involved intentional
misconduct, fraud or a knowing violation of law. Thus, the Company may be
prevented from recovering damages for certain alleged errors or omissions by the
officers and directors for liabilities incurred in connection with their good
faith acts for the Company.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the small
business issuer pursuant to the foregoing provisions, or otherwise, the small
business issuer has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable.
DESCRIPTION OF BUSINESS
-----------------------
BUSINESS DEVELOPMENT
The Company was originally incorporated in Nevada as JavaJuice.net on
September 13, 2000. The Company's business plan was to engage in the operation
of an Internet Cafe, in Reno, Nevada. Prior to entering into the Exchange,
discussed below, and the consummation of the transactions thereunder, the
Company was considered a development stage enterprise, as defined in Financial
Accounting Standards Board No. 7, as the Company's planned principal operations
had not commenced, the Company had not generated any revenue, and all of its
efforts were devoted to securing and establishing a new business.
On August 8, 2003, JavaJuice, MT and the former MT shareholders entered
into the Exchange whereby MT became a wholly-owned subsidiary of the Company. In
addition, MacDonald Tudeme, the Company's Chief Executive Officer, a director of
the Company, and a former MT shareholder, entered into a stock purchase
agreement with the Company's former officer and director, Laura Mazany. As a
result of these transactions, control of the Company shifted to the former MT
shareholders.
MT operates a payroll nurse staffing and homecare business. As a result of
a change in business focus due to the acquisition of MT, the Company changed its
name to MT Ultimate Healthcare Corp. In February 2004, the Company established a
high tech infusion nursing department. In July 2004, the Company acquired all of
the issued and outstanding common stock of BP from BP's sole shareholder in
exchange for 200,000 shares of the Company's Common Stock. As additional
consideration, the Company agreed to pay BP's sold shareholder an aggregate of
$150,000 cash payable as follows: a) $25,000 upon closing the transaction; and
b) $125,000 payable at the beginning of the month in equal monthly installments
of $4,808 over a twenty-five month period beginning June 2004, and a final
payment of $4,800 at the beginning of the twenty-sixth month following June
2004. BP provides 24-hour healthcare services to senior citizens in the New
Jersey metropolitan area.
In October 2004, the Company entered into an Agreement and Plan of
Acquisition and Merger ("Agreement") to acquire Abundant Nursing, Inc., a
Pennsylvania corporation ("Abundant") in exchange for $150,000 paid at closing
and a five-year promissory note in the principal amount of $295,000 that accrues
interest at a rate of seven percent (7%) per annum. Abundant may be merged with
and into the Company after the Company has fully-paid all amounts due under the
Agreement. Until such time as the Company pays the full consideration pursuant
to the Agreement, Abundant will be operated by the Company as a stand alone
subsidiary. Abundant is located in Mount Joy, Pennsylvania and provides staffing
in the central area of Pennsylvania and the Lancaster area.
In September 2003, the Company completed an 80 to 1 forward stock split
followed by a 1 to 4 reverse stock split. The effects of the Stock Splits have
been retroactively reflected in this Prospectus unless otherwise stated.
-22-
PRINCIPAL PRODUCTS AND SERVICES
The Company, through its wholly-owned Nevada subsidiary, MT, operates a
payroll nurse staffing and homecare business. The Company provides healthcare
professionals such as Certified Nursing Assistants, Nurse Technicians, Licensed
Practical Nurses and Registered Nurses to hospitals, nursing homes, LHCSAs,
other health-related businesses, and to the homes of the elderly, sick and
incapacitated. In January 2004, the Company received a license from the State
of New York, Department of Health, effective December 9, 2003, to operate as a
LHCSA in the five boroughs of New York City: The Bronx, Brooklyn, Manhattan,
Queens and Staten Island, as well as in Nassau County. The Company also
operates a 24-hour healthcare services business for senior citizens through its
wholly-owned New Jersey subsidiary, BP.
The Company currently operates a payroll nurse staffing and homecare
business. The Company provides healthcare professionals such as Certified
Nursing Assistants, Nurse Technicians, Licensed Practical Nurses and Registered
Nurses to hospitals, nursing homes, licensed home care services agencies
("LHCSAs"), other health-related businesses, and to the homes of the elderly,
sick and incapacitated. In January 2004, the Company received a license from the
State of New York, Department of Health, effective December 9, 2003, to operate
as a LHCSA in the five boroughs of New York City: The Bronx, Brooklyn,
Manhattan, Queens and Staten Island, as well as in Nassau County.
Currently, the Company's primary target market consists of public
hospitals, private hospitals and nursing homes in the five (5) Boroughs of New
York City, the elderly and patients that have been discharged from hospitals and
are recuperating at home. The market for the provision of healthcare services in
New York City metropolitan area is very competitive. MT competes with several
healthcare service providers and healthcare staffing companies. These
competitors include Best Care, All Care Services, White Gloves, and Prefer
Nursing. MT believes that it has the capacity to acquire 5% of its primary
target market.
The Company takes into consideration the customer's needs and optimizes its
resources to fit those needs. The Company markets its services under the names
"M.T. Ultimate Healthcare Staffing and Homecare Services," "M.T. Ultimate
Services," or "M.T. Ultimate."
INDUSTRY AND MARKET OVERVIEW
The provision of nursing staff to hospitals and nursing homes in the United
States is an estimated multi-billion dollar industry. Based on research that
the Company conducted on twenty-five hospitals and nursing homes, the results
show that they employ staff agency employees to cover odd shifts such as nights,
weekends and unplanned absenteeism. According to a recent publication of the
American Journal of Nursing, the demand for nurses will continue to rise as the
"baby boomers" retire. Furthermore, there is a present shortage of skilled
nursing professionals which is expected to worsen due to the pressures of
managed care. The hospitals, which employ based on headcount, will continue to
have a growing need for agency nurses that do not figure into their headcount.
The Company remains flexible enough to meet the staffing requirements of both
the hospital and the home healthcare segments.
-23-
COMPETITION AND COMPETITIVE STRATEGY
The medical staffing industry is both highly fragmented and highly
competitive. There are a large number of firms engaged in the provision of
medical personnel. A significant number of these companies are very small
competitors operating on a localized basis. There are however, a few larger
companies that operate on a national basis. The Company believes that its
unique marketing approach, coupled with innovative methods for identifying
skilled personnel offer competitive advantages of both forms of competition.
The Company intends to compete in the nurse staffing industry based
primarily on its unique marketing approach, its willingness to provide support
to its staff, superior client service, and its aggressive recruitment policy
within the United States and abroad. The Company's management believes that its
ability to recruit experienced nursing staff and its relationship with its staff
gives the Company a competitive advantage.
Recruitment Policy
- ------------------
There is currently a pool of trained, experienced, immigrant nurses in the
New York City metropolitan area. Most of our competitors are not positioned to
identify, connect with, and turn this pool of nurses into a New York State
licensed workforce. The Company's strategy for bringing this workforce to
market is based in large part on its standing and reputation in these immigrant
communities and management's first-hand knowledge of successfully making a
cultural conversion as it relates to nursing. The Company intends to attract
this pool or nurses by assisting them in obtaining their New York State nursing
licenses.
In addition to this internal recruitment drive, the Company also intends to
recruit trained, experienced nurses from the Philippines, India, the West
Indies, Africa and Europe. The Company, with the assistance of immigration
lawyers, intends to sponsor these nurses, assist them in obtaining New York
State nursing licenses, and sign them to renewable three-year employment
contracts.
CLIENT BASE AND RECENT DEVELOPMENTS
The Company has a range of clients, notably spanning hospitals located in
the metropolitan New York City area. The Company's largest client is the City
of New York Hospitals which accounted for approximately 60% of total revenues
for December 31, 2003. The Company actively seeks to increase its client base
and to broaden its service and product offerings.
In January 2004, the Company received a license from the State of New York,
Department of Health, effective December 9, 2003, to operate as a LHCSA in the
five boroughs of New York City: The Bronx, Brooklyn, Manhattan, Queens and
Staten Island, as well as in Nassau County. The Company now has the ability to
provide a full range of medically necessary healthcare services. The licensure
allows the Company to reach a broader audience of clients requiring skilled,
in-home healthcare services such as health planning therapy, drug injections and
medication delivery. The licensure also provides the Company with access to
client referrals from hospitals, skilled nursing and long-term care facilities
that were previously unavailable to the Company.
In February 2004, the Company established a high tech infusion nursing
department that will allow staff to provide highly-specialized nursing services
to the Company's clients. With the addition of this new department, the
Company's clients can now be referred by doctors, insurance companies or
infusion companies to receive highly skilled, in-home specialty health care
service by the Company's staff of appropriately qualified registered nursing
professionals.
-24-
The Company signed three contracts in 2004 and one in 2003 that relate to
its business operations. In July 2004 and in March 2004, the Company signed a
contract with Prompt Care, Inc. ("Prompt Care") and MidAtlantic Home Infusion
Company ("MidAtlantic"), respectively, to provide Prompt Care and MidAtlantic on
an as-needed basis with specialized nursing personnel qualified to provide home
infusion therapy to patients in the New York area. In February 2004, the Company
signed a contract with Christian Pilgrim Outreach ("CPO"). Under the contract,
CPO will provide the Company with access to more than 400 medically trained
personnel worldwide over a three-year period. During the second quarter of 2003,
the Company signed a contract with CABS Nursing Home of Brooklyn, New York
("CABS") to provide CABS on an as-needed basis with qualified nursing personnel
over the next several years.
The Company expects that, due to planned expansion, the license to operate
as a LHCSA, and the new contracts with Prompt Care, MidAtlantic and CABS, the
Company will depend less heavily on the City of New York Hospitals as a source
of revenue during 2004.
GOVERNMENT REGULATION
The Company is licensed by the State of New York, Department oh Health to
operate as a LHCSA in the five boroughs of New York City and in Nassau County.
The Company was required to prepare operating manuals as part of the approval
process. Home healthcare licensure requires the Company to make sure that its
staff is appropriately qualified, trained and supervised to provide skilled,
in-home healthcare services. The Company will be subject to unannounced surveys
to assess its compliance with state and federal standards governing the quality
and scope of the services it provides. In the event we do not comply with the
license, we may be subject to penalties.
EMPLOYEES
The Company currently employs over sixty (60) people on a full-time basis.
These employees include Certified Nursing Assistants, Nurse Technicians,
Licensed Practical Nurses, and Registered Nurses. The Company intends to recruit
at least three Registered Nurses during the fourth quarter of 2004.
MANAGEMENT'S DISCUSSION AND ANALYSIS
------------------------------------
This report contains forward looking statements within the meaning of
Section 27a of the Securities Act of 1933 and Section 21e of the Securities
Exchange Act of 1934. These forward looking statements are subject to certain
risks and uncertainties that could cause actual results to differ materially
from historical results or anticipated results, including those set forth,
above, in the section entitled "RISK FACTORS" and elsewhere in this Prospectus.
The following discussion and analysis should be read in conjunction with the
Company's financial statements and notes thereto included in the section
entitled "FINANCIAL STATEMENTS" in this Prospectus.
OVERVIEW
The Company was originally incorporated under the name JavaJuice.net on
September 13, 2000. On August 8, 2003, the Company acquired 100% of the
outstanding shares of MT pursuant to the Exchange. As a result of the Exchange,
the business of MT became the business of the Company, control of the Company
shifted to the former MT shareholders and the Company subsequently changed its
name to MT Ultimate Healthcare Corp.
In September 2003, the Company completed an 80 to 1 forward stock split
followed by a 1 to 4 reverse stock split. The effects of the Stock Splits have
been retroactively reflected in this Prospectus unless otherwise stated.
MT operates a payroll nurse staffing and homecare business. In February
2004, the Company established a high tech infusion nursing department. In July
2004, the Company acquired all of the issued and outstanding common stock of BP
from BP's sole shareholder in exchange for 200,000 shares of the Company's
Common Stock. As additional consideration, the Company agreed to pay BP's sold
shareholder an aggregate of $150,000 cash payable as follows: a) $25,000 upon
closing the transaction; and b) $125,000 payable at the beginning of the month
in equal monthly installments of $4,808 over a twenty-five month period
beginning June 2004, and a final payment of $4,800 at the beginning of the
twenty-sixth month following June 2004. BP provides 24-hour healthcare services
to senior citizens in the New Jersey metropolitan area.
-25-
The Company provides healthcare professionals such as Certified Nursing
Assistants, Nurse Technicians, Licensed Practical Nurses and Registered
Nurses to hospitals, nursing homes, LHCSAs, other health-related businesses,
and directly to the homes of the elderly, sick, and incapacitated. The Company
also operates a 24-hour healthcare services business for senior citizens.
KNOWN TRENDS, EVENTS AND UNCERTAINTIES
The Company is aggressively seeking to expand its operations outside of
the New York City metropolitan areas. The Company is also actively seeking to
broaden its service and product offerings. Continuing its plan from the first
and second quarter, the Company is focusing on expanding its business during
this third quarter, and throughout the remainder of 2004. Management expects
that much of the growth will come from acquisitions and by internal new business
development. In particular, the Company plans to extend its high-tech nursing
business throughout the area. The Company acquired BP and Abundant in
accordance with the Company's acquisition plan.
COMPARISON OF OPERATING RESULTS
THREE MONTHS ENDED JUNE 30, 2004 COMPARED TO THREE MONTHS ENDED JUNE 30, 2003
Revenues increased to $466,975 from $220,935 for the three months ended
June 30, 2003, reflecting an increase of $246,040 (or 110%) for the three
months ended June 30, 2004. The increase in revenues was generally due to the
results of new business development activities.
Cost of revenues increased $171,267 from $153,818 for the three months
ended June 30, 2003 to $325,085 (or 110%) for the three months ended June 30,
2004. The increase in cost of revenues was directly attributable to the
increase in
revenues.
Gross profit increased to $141,890 for the period ended June 30,
2004, an increase of $74,773 (or 110%) from the $67,117 in gross profit
realized for the three months ended June 30, 2003. The increase in gross profit
was derived from the increase in revenues.
Gross profit as a percentage of sales ("gross profit margin") was 30% for
both the three months ended June 30, 2003 and the three months ended June 30,
2004.
The Company had General and Administrative (G&A) expenses of $217,395
for the three months ended June 30, 2004, compared to G&A expenses of $55,724
for the three months ended June 30, 2003. This increase in G&A expenses is
primarily due to certain research and due diligence actions necessary in
evaluating potential acquisitions as well as expanded business development and
marketing activities. Management plans for G&A expenses to become less of a
percentage of revenues, notably beginning later in 2004.
For the three months ended June 30, 2004, the Company had a net loss
from operations of $75,505, as compared to a net income from operations of
$11,393 for the three months ended June 30, 2003. The change in position from
net income from operations to net loss from operations was primarily due to the
increase in G&A expenses. The Company has incurred a Net Operating Loss
(NOL) from operations. No tax benefit is being recorded at this time due
to current uncertainties in the ability of the Company to recover the
NOL.
As of June 30, 2004, the Company had an accumulated deficit of
$546,813.
-26-
SIX MONTHS ENDED JUNE 30, 2004 COMPARED TO SIX MONTHS ENDED JUNE 30, 2003
Revenues increased by $426,555 to $881,331 (or 94%) for the six months
ended June 30, 2004, compared to $454,776 in revenues for the six months
ended June 30, 2003. The increase in revenues was due to new business
development activities, notably in the "high tech" nursing practice.
Cost of revenues increased $396,367 from $268,242 for the six months ended
June 30, 2003, to $664,609 (or 148%) for the six months ended June 30,
2004. The increase in cost of revenues was primarily due to the increased
revenues as well as certain initial costs associated with launching the
Company's "high tech" nursing practice and establishing the office in
Baldwin, New York.
Gross profit increased $30,188 to $216,722 for the six months ended
June 30, 2004. This reflects an increase (16%) over the gross profit of $186,534
realized for the six months ended June 30, 2003. The increase in gross profit
was mainly attributable to the increase in revenues that was offset by the
increase in cost of revenues.
Gross profit, as a percentage of sales ("gross profit margin"), was 25%
for the six months ended June 30, 2003, as compared to 41% for the six months
ended June 30, 2004. The decrease in gross profit margin is attributable
to the noted increase in the cost of revenues.
The Company had total General and Administrative (G&A) expenses of
$698,782 for the six months ended June 30, 2004, as compared to total G&A
expenses of $146,497 for the six months ended June 30, 2003. The increase in
expenses was primarily due to the Company's expansion efforts and the
issuance of common stock to certain consultants in exchange for services.
For the six months ended June 30, 2004, the Company had a net loss
from operations of $482,060, as compared to net income from operations of
$40,037 for the six months ended June 30, 2003. The change in position from net
income from operations to net loss from operations was due to resulting
increases in the cost of revenues and G&A expenses. Although the Company
has incurred a net operating loss ("NOL"), no tax benefit is being
recorded at this time.
FISCAL YEAR ENDED DECEMBER 31, 2003 COMPARED TO FISCAL YEAR ENDED DECEMBER 31,
2002
Revenues increased $499,904 (or 76%) from $659,333 for the fiscal year
ended December 31, 2002 to $1,159,237 for the fiscal year ended December 31,
2003. The increase in revenues was due to new business infusion and skilled
nursing services being provided during 2003.
Cost of revenues increased $384,728 from $508,144 for the fiscal year ended
December 31, 2002 to $892, 872 (or 76%) for the fiscal year ended December 31,
2003. The increase in cost of revenues was due to the increase in sales.
Gross profit increased $115,176 (or 76%) from $151,189 for the fiscal year
ended December 31, 2002 to $266,365 for the fiscal year ended December 31, 2003.
The increase in gross profit was attributable to the matching increases in
revenues and cost of revenues. As a result, gross profit as a percentage of
sales ("gross profit margin") remained the same at 23% for both the fiscal years
ended December 31, 2003 and 2002.
The Company had total expenses of $363,325 for the fiscal year ended
December 31, 2003, as compared to total expenses of $143,315 for the fiscal year
ended December 31, 2002. The expenses for the fiscal year ended December 31,
2003 consisted of the following: $75,129 of salaries and wages, $77,902 of
professional fees, $23,920 of depreciation, $12,867 of interest expense, and
$173,507 of operating expenses. In comparison, the expenses for the fiscal year
ended December 31, 2002 consisted of $33,355 of salaries and wages, $10,036 of
professional fees, $15,527 of depreciation, $7,930 of interest expense, and
$76,467 of operating expenses. The increase in expenses was primarily due to
infrastructural developments, licensure expenses, and increased operations.
-27-
For the fiscal year ended December 31, 2003, the Company had a net loss
from operations of $96,960, as compared to net income of $7,874 for the fiscal
year ended December 31, 2002. The change in position from net income from
operations to net loss from operations is due to the increase in expenses.
Although the Company has incurred an NOL, no tax benefit is being recorded at
this time because there is no assurance that the Company will recover the NOL.
The Company had a net loss of $96,960 for the fiscal year ended December
31, 2003, as compared to net income of $7,874 for the fiscal year ended December
31, 2002. The change in position from net income to net loss is due to the
increase in expenses.
As of December 31, 2003, the Company had an accumulated deficit of $64,753.
The Company had basic and diluted earnings per share of $(0.00) and $0.00
as of December 31, 2003 and 2002, respectively.
LIQUIDITY AND CAPITAL RESOURCES
SIX MONTHS ENDED JUNE 30, 2004 COMPARED TO SIX MONTHS ENDED JUNE 30, 2003
As of June 30, 2004, total current assets were $382,097 which
consisted of accounts receivable, net of an allowance for doubtful accounts, of
$347,088, and other current assets of $35,009.
As of June 30, 2004, total current liabilities were $106,976 which
consisted of accounts payable and accrued liabilities of $52,080, a cash
overdraft of $1,345, a note payable of $44,983, and the current portion of
capital leases of $8,568.
Net working capital was $275,121 at June 30, 2004. The ratio of current
assets to current liabilities was 3.57 to 1.
Net cash used in operating activities was $349,458 for the six months ended
June 30, 2004, as compared to net cash provided from operating activities of
$66,511 for the six months ended June 30, 2003. For the six months ended June
30, 2004, the Company had net loss of $482,060, an increase in accounts
receivable of $150,054, an increase in other current assets of $14,837 and
a decrease in accounts payable and accrued liabilities of $7,787 that was offset
by $15,280 of depreciation and $290,000 of stock issued for services.
Net cash used in investing activities was $726 for the six months ended
June 30, 2004, as compared to net cash used in investing activities of
$43,507 for the six months ended June 30, 2003. The Company made investments in
property, plant and equipment during these periods.
Net cash provided from financing activities was $292,579 for the six
months ended June 30, 2004, as compared to net cash used in financing
activities of $39,158 for the six months ended June 30, 2003. The Company's
primary source of cash from financing activities for the six months ended
June 30, 2004 was $192,614 notes payable from related parties, as discussed in
Note 3 of Notes to Financial Statements for June 30, 2004, included in the
section heading "FINANCIAL STATEMENTS".
The Company had a net decrease in cash of $57,605 for the six months ended
June 30, 2004.
-28-
FISCAL YEAR ENDED DECEMBER 31, 2003 COMPARED TO FISCAL YEAR ENDED DECEMBER 31,
2002
As of December 31, 2003, total current assets were $271,964 which consisted
of $54,758 of cash, $197,034 of accounts receivable, net of an allowance for
doubtful accounts, and $20,172 of other current assets.
As of December 31, 2003, total current liabilities were $67,369 which
consisted of $59,867 of accounts payable and accrued liabilities and $7,502 of
current portion of capital leases.
Net working capital was $204,595 at December 31, 2003. The ratio of current
assets to current liabilities was 4.0.
The Company had a net increase in cash of $21,068 for the fiscal year ended
December 31, 2003. The Company used $153,163 of cash in operating activities,
consisting of the Company's net loss of $96,960 and adjustments due to an
increase of $62,472 in accounts receivable and an increase of $20,702 in other
current assets which were offset by an adjustment of $12,877 for depreciation
and an adjustment of $14,094 due to an increase in accounts payable.
The Company spent $44,775 on property, plant and equipment during the
fiscal year ended December 31, 2003.
Cash flows from financing activities were $219,006 for the fiscal year
ended December 31, 2003, consisting of an increase of bank notes in the amount
of $60,484, an increase in capital leases of $8,522 and an issuance of 600,000
shares of the Company's common stock as satisfaction of indebtedness in the
amount of $150,000.
Interest expense was $12,867 for the fiscal year ended December 31, 2003.
As described in Note 6 of Notes to Financial Statements for December 31, 2003,
included in the section heading "FINANCIAL STATEMENTS", the Company has two
lines of credit with variable interest rates that are underwritten by the Small
Business Administration. As of December 31, 2003, $47,500 with a 6% interest
rate was outstanding under one line of credit and $141,197 with a 5% interest
rate was outstanding under the other line of credit. The lines of credit mature
on January 29, 2009 and January 1, 2005, respectively.
The Company has several capital leases for computers and telephone
equipment. The aggregate capital amount of the leases was $19,754 as of
December 31, 2004 of which $7,502 was the current portion of the lease
commitment.
The Company has entered into various leases for office space. As of
December 31, 2003, the minimum lease payments under these leases in 2004 was
$66,310.
The Company requires $2 million of financing to expand its business
operations through the acquisition of other enterprises and the creation or
organization of offices outside of the New York City metropolitan area.
This financing is in addition to $500,000 already raised and a
$200,000 commitment. We recently received an aggregate of $500,000 of
Convertible Note financing from four (4) unrelated parties. We also received a
commitment from these parties to purchase an additional $200,000 of Convertible
Notes (subject to the Company's satisfaction of certain conditions as discussed
under the heading "RISK FACTORS") upon the effectiveness of the registration
statement to which this Prospectus is a part. In connection with the
Convertible Note financing, we issued Warrants to purchase 500,000 shares of our
Common Stock at an exercise price of $0.45 per share. We will issue identical
Warrants to purchase 200,000 shares of our Common Stock along with the
commitment to purchase an additional $200,000 of Convertible Notes. At this
time, no financing other than the $200,000 commitment has been secured or
identified. Our growth and continued operations could be impaired by
limitations on our access to the capital markets. Without additional financing,
we can continue our operations. However, if we are unable to obtain additional
financing upon terms that management deems sufficiently favorable, or at all, it
would have a material adverse impact upon our ability to pursue our expansion
strategy. There can be no assurance that capital from outside sources will be
available, or if such financing is available, it may involve issuing securities
senior to our Common Stock or equity financings which are dilutive to holders of
our Common Stock. In addition, in the event we do not raise additional capital
from conventional sources, it is likely that our growth will be restricted and
we may need to scale back or curtail implementing our business plan.
-29-
While the Company is not currently a party to any agreements with respect
to any acquisitions, it is possible that an agreement in principle or a
definitive agreement as to one or more acquisitions will be executed prior to
the completion of the current capital raising efforts. The capital requirements
as stated will be sufficient to complete the Company's initial acquisition and
expansion phase over the next 18 to 24 months. The Company may require
additional investment capital in the future to support additional strategic
acquisitions and further expansion initiatives.
CRITICAL ACCOUNTING POLICIES
Our discussion and analysis of our financial condition and results of
operations is based upon our financial statements, which have been prepared in
accordance with accounting principals generally accepted in the United
States. The preparation of these financial statements requires us to make
estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of any contingent
assets and liabilities. On an on-going basis, we evaluate our estimates,
including those related to uncollectible receivables, investment values,
income taxes and contingencies. We base our estimates on various assumptions
that we believe to be reasonable under the circumstances, the results of
which form the basis for making judgments about carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results
may differ from these estimates under different assumptions or conditions.
We believe the following critical accounting policies affect our
more significant judgments and estimates used in the preparation of our
financial statements:
Federal Income Tax. The Company has adopted the provisions of
Financial Accounting Standards Board Statement No. 109, Accounting for Income
Taxes. The Company accounts for income taxes pursuant to the provisions of
the Financial Accounting Standards Board Statement No. 109, "Accounting for
Income Taxes", which requires an asset and liability approach to calculating
deferred income taxes. The asset and liability approach requires the recognition
of deferred tax liabilities and assets for the expected future tax
consequences of temporary differences between the carrying amounts and the
tax basis of assets and liabilities. The Company has incurred an NOL,
however, because there is no assurance of recovery of the NOL, it has been
fully offset and the Company does not have a deferred tax asset with respect to
any portion thereof. The valuation allowance will be evaluated, considering
positive and negative evidence about whether the deferred tax asset will be
realized. The allowance will either be increased or reduced. A reduction
could result in the complete elimination of the allowance if positive evidence
indicates that the value of the deferred tax assets is no longer impaired
and the allowance is no longer required.
Use of Estimates. The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure on contingent assets and liabilities at the date
of the financial statements, and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from
those estimates.
Accounting Method. The Company's financial statements are prepared
using the accrual method of accounting. Revenues are recognized when earned
and expenses when incurred. Fixed assets are stated at cost. Depreciation and
amortization using the straight-line method for financial reporting purposes
and accelerated methods for income tax purposes.
-30-
Cash and Cash Equivalents. The Company considers all highly liquid debt
instruments with a maturity of three months or less at the time of purchase to
be in cash equivalents. Cash and cash equivalents consist of checking accounts
and money market funds.
Fair Value of Financial Instruments. The carrying amounts of financial
instruments including cash and cash equivalents, accounts receivable and
payable, accrued and other current liabilities and current maturities of
long-term debt approximate fair value due to their short maturity.
DESCRIPTION OF PROPERTY
-----------------------
The Company's executive offices are located in Brooklyn, New York. The
Company placed a $11,918 security deposit for a five-year lease for
approximately 4,000 square feet of office space for its executive offices. The
current monthly lease commitment is $3,500 and will increase to $3,939 per month
at the end of the lease on October 31, 2008.
The Company entered into a lease for approximately 850 square feet of
office space in Baldwin, New York that became effective on January 1, 2004. The
current monthly lease commitment is $1,300. The lease expires in five years.
The Company currently has a five-year lease for office space in the Bronx,
New York that ends in 2007. The rental rate ranges from $650 to $850 per month
during the term of the lease.
CERTAIN RELATIONSHIPSAND RELATED TRANSACTIONS
---------------------------------------------
GUARANTEES
The Company has significant related party transactions and/or relationships
with the Company's President, MacDonald Tudeme. Mr. Tudeme has guaranteed the
Company's bank indebtedness under a $150,000 loan and a $50,000 line of credit,
both of which are underwritten by the United States Small Business
Administration. Mr. Tudeme has also pledged 5,700,000 shares of Common Stock
owned by him as collateral to guarantee the due and punctual performance and
payment of the Company's obligations under the Agreement and related documents.
Mr. Tudeme has made these guarantees without charging a fee.
ENGAGEMENT LETTER AND ISSUANCE OF COMMON STOCK
Effective October 1, 2004, the Company entered into an engagement letter
with Wayne F. Richardson, as set forth in more detail under the section entitled
"DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSON", above. Mr.
Richardson will receive $57,000 as compensation for his services as the
Company's Chief Financial Officer. In August 2004, the Company issued 200,000
shares of Common Stock to Wayne F. Richardson for his services as a director of
the Company and the Company's Chief Financial Officer.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
--------------------------------------------------------
"Bid" and "asked" offers for the common stock are listed on the NASDAQ
OTC-Bulletin Board published by the National Quotation Bureau, Inc. The
Company's common stock began regular trading during the fiscal year ended
December 31, 2003. The trading symbol for the common stock was "JAVA" and was
changed to "MTUH" in connection with the Company's name change and an 80 to one
forward stock split in September 2003. As a result of a one to 4 reverse stock
split that also occurred in September 2003, the trading symbol was later changed
to the current symbol, "MTHC".
-31-
The following table sets forth the high and low bid prices for the
Company's common stock for the periods indicated as reported by the NASDAQ
OTC-Bulletin Board. The quotations reflect inter-dealer prices, without retail
mark-up, mark-down or commission and may not represent actual transactions.
Bid Prices
Quarter Ended High Low
- ------------------ ----- -----
September 30, 2004 $0.29 $0.29
June 30, 2004 $0.60 $0.51
March 31, 2004 $1.05 $0.88
December 31, 2003 $1.05 $1.05
September 30, 2003 $1.50 $1.43
June 30, 2003 $0.02 $0.02
March 31, 2003 $0.01 $0.01
There were 39 holders of record of the common stock as of October 4,
2004. The Company has never paid a cash dividend on its common stock and does
not anticipate the payment of a cash dividend in the foreseeable future. The
Company intends to reinvest in its business operations any funds that could be
used to pay a cash dividend. The Company's common stock is considered a "penny
stock" as defined in the Commission's rules promulgated under the Exchange Act.
In general, a security which is not quoted on NASDAQ or has a market price of
less than $5.00 per share where the issuer does not have in excess of $2,000,000
in net tangible assets (none of which conditions the Company meets) is
considered a penny stock. The Commission's rules regarding penny stocks impose
additional sales practice requirements on broker-dealers who sell such
securities to persons other than established customers and accredited investors
(generally persons with net worth in excess of $1,000,000 or an annual income
exceeding $200,000 or $300,000 jointly with their spouse). For transactions
covered by the rules, the broker-dealer must make a special suitability
determination for the purchaser and receive the purchaser's written agreement to
the transaction prior to the sale. Thus the Rules affect the ability of
broker-dealers to sell the Company's shares should they wish to do so because of
the adverse effect that the Rules have upon liquidity of penny stocks. Unless
the transaction is exempt under the Rules, under the Securities Enforcement
Remedies and Penny Stock Reform Act of 1990, broker-dealers effecting customer
transactions in penny stocks are required to provide their customers with (i)
a risk disclosure document; (ii) disclosure of current bid and ask quotations if
any; (iii) disclosure of the compensation of the broker-dealer and its sales
personnel in the transaction; and (iv) monthly account statements showing the
market value of each penny stock held in the customer's account. As a result of
the penny stock rules the market liquidity for the Company's securities may be
severely adversely affected by limiting the ability of broker-dealers to sell
the Company's securities and the ability of purchasers of the securities to
resell them.
EXECUTIVE COMPENSATION
----------------------
SUMMARY COMPENSATION TABLE(1)
Annual Compensation
-------------------
Name & Principal Bonus Other Annual
Position Year Salary ($) ($) Compensation
- ------------------------ ---------- -------------- ------------ ------------
MacDonald S. Tudeme, 2004 $ 66,344 $10,800 (2)
CEO, President, 2003 $ 8,654 $10,800 (2)
Treasurer and Director 2002 $ 0 $10,800 (2)
<FN>
(1) Does not include perquisites and other personal benefits in amounts less than 10% of the
total annual salary and other compensation.
(2) MacDonald S. Tudeme received a vehicle allowance of $10,800 during the fiscal year ended
December 31, 2003 and $10,800 during the fiscal year ended December 31, 2002. Mr. Tudeme did not
receive a vehicle allowance or any other type of compensation during the fiscal year ended
December 31, 2001.
-32-
FINANCIAL STATEMENTS
--------------------
MT ULTIMATE HEALTHCARE CORP
CONSOLIDATED BALANCE SHEET
Unaudited
A S S E T S
-----------
JUNE 30, DECEMBER 31
---------- -----------
Current Assets 2004 2003
- ---------------
Cash $ - $ 54,758
Accounts Receivable, net of allowance 347,088 197,034
Other Current Assets 35,009 20,172
---------- -----------
Total Current Assets 382,097 271,964
---------- -----------
Property, plant and equipment, net of
accumulated depreciation 115,853 131,859
---------- -----------
Total Assets $ 497,950 $403,823
========== ===========
L I A B I L I T I E S
---------------------
Current Liabilities
- --------------------
Accounts Payable and accrued liabilities 52,080 59,867
Cash Overdraft 1,345
Note Payable 44,983 -
Current Portion Capital Lease 8,568 7,502
---------- -----------
Total Current Liabilities 106,976 67,369
---------- -----------
Long-Term Liabilities:
Bank Note 148,197 188,697
Notes Payable-Related Party 192,614 -
Capital Leases 7,574 12,252
---------- -----------
Total Long Term Liabilities 348,385 200,949
---------- -----------
Total Liabilities 455,361 268,318
S T O C K H O L D E R S ' E Q U I T Y
-----------------------------------------
Common Stock
400,000,000 authorized shares, par value $.001
52,060,040 and 50,600,000 shares issued and outstanding 52,060 50,600
Additional Paid-in-Capital 537,342 149,658
Accumulated Profits /( Deficit) (546,813) (64,753)
---------- -----------
Total Stockholders' Equity 42,589 135,505
---------- -----------
Total Liabilities and Stockholders' Equity $ 497,950 $403,823
========== ============
See accompanying notes to Financial Statements
F-1
MT ULTIMATE HEALTHCARE CORP
STATEMENT OF OPERATIONS
UNAUDITED
FOR THE THREE MONTHS ENDED FOR THE SIX MONTHS ENDED
JUNE,30 JUNE,30
------- -------
2004 2003 2004 2003
------------ ----------- ------------ ---------
REVENUES:
- ---------
Revenues $ 466,975 $ 220,935 $ 881,331 $ 454,776
------------ ----------- ------------ ---------
Total Revenues 466,975 220,935 881,331 454,776
COST OF REVENUES:
- -----------------
Cost of Revenues $ 325,085 $ 153,818 $ 664,609 $ 268,242
------------ ----------- ------------ ---------
Gross Profit $ 141,890 $ 67,117 $ 216,722 $ 186,534
G&A EXPENSES
- ------------
Salaries & Wages 111,334 16,473 181,069 57,898
Stock Issued for Services - - 290,000 -
Professional Fees 33,826 8,530 69,923 17,580
Rent 21,582 3,500 43,164 6,000
Depreciation 7,640 5,044 15,280 10,088
Interest Expense 1,708 5,181 5,194 5,957
Operating Expenses 41,305 16,996 94,152 48,974
------------ ----------- ------------ ---------
Total Expenses 217,395 55,724 698,782 146,497
------------ ----------- ------------ ---------
Net Income / ( loss ) from Operations (75,505) 11,393 (482,060) 40,037
PROVISION FOR INCOME TAXES:
- ---------------------------
Income Tax Benefit - - - -
------------ ----------- ------------ ---------
Net Income (Loss) $ (75,505) $ 11,393 $ (482,060) $ 40,037
============ =========== ============ =========
Basic and Diluted Earnings Per Common Share $ (0.01) $ 0.00 $ (0.01) $ 0.00
------------ ----------- ------------ ---------
Weighted Average number of Common Shares 52,060,040 9,050,000 52,060,040 9,050,000
used in per share calculations ============ =========== ============ =========
See accompanying notes to Financial Statements
F-2
MT ULTIMATE HEALTHCARE CORP
CONSOLIDATED STATEMENT OF CASH FLOWS
UNAUDITED
FOR THE SIX MONTHS ENDED
JUNE, 30
--------
2004 2003
----------- ----------
Cash Flows from Operating Activities:
- -------------------------------------
Net Income (Loss) $(482,060) $ 40,037
Adjustments to Reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation 15,280 10,088
Stock Issued for Services 290,000 -
Changes in operating assets and liabilities:
Accounts Receivable (150,054) (20,036)
Other Current Assets (14,837) 24,870
Accounts Payable and accrued liabilities (7,787) 11,552
----------- ----------
Net Cash Provided from (Used In)Operating Activities (349,458) 66,511
----------- ----------
Cash Flows from Investing Activities:
- -------------------------------------
Property, plant and equipment (726) (43,507)
----------- ----------
Net Cash Used in Investing Activities (726) (43,507)
----------- ----------
Cash Flows from Financing Activities:
- ------------------------------------------------------
Bank Note 4,433 (43,865)
Note Payable - Related Party 192,614 -
Issuance of Stock 99,144 -
Capital Leases (3,612) 4,707
----------- ----------
Net Cash Provided from (Used In) Financing Activities 292,579 (39,158)
----------- ----------
Net Decrease in Cash (57,605) (16,154)
----------- ----------
Cash Balance, Begin Period 17,366 33,690
----------- ----------
Cash Balance, End Period $ (1,345) $ 17,536
=========== ==========
Supplemental Disclosures:
Cash Paid for interest $ 5,194 $ 5,957
=========== ==========
Cash Paid for income taxes $ - $ -
=========== ==========
See accompanying notes to Financial Statements.
F-3
MT ULTIMATE HEALTHCARE CORP.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2004
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- -----------------------------------------------------
ORGANIZATION
- ------------
The Company was originally incorporated under the laws of the State of Nevada on
September 13, 2001 for the purpose to promote and carry on any lawful business
for which a corporation may be incorporated under the laws of the State of
Nevada. The company has a total of 400,000,000 authorized shares with a par
value of $.001 per share and with 52,060,040 shares issued and outstanding as of
June 30, 2004. The Company filed an amended Articles of Incorporation with the
State of Nevada on August 15, 2003 to change the name to MT Ultimate Healthcare
Corp from Java Juice.net and to increase the authorized shares to 400,000,000
common shares. Also, the Company agreed to an 80-to-1 forward split of the
shares in this amended filing. On September 29, 2003, the Company agreed to a
1-for-4 reverse split. These financial statements reflect these filings.
FINANCIAL STATEMENT PRESENTATION
- ----------------------------------
The consolidated un-audited interim financial statements of the Company as of
June 30, 2004 and for the three months ended June 30, 2004, included herein have
been prepared in accordance with the instructions for Form 10QSB under the
Securities Exchange Act of 1934, as amended, and Article 10 of Regulation S-X
under the Securities Act of 1933, as amended. Certain information and note
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations relating to interim consolidated
financial statements.
In the opinion of management, the accompanying consolidated un-audited interim
financial statements reflect all adjustments, consisting only of normal
recurring adjustments, necessary to present fairly the financial position of the
Company at June 30, 2004, and the results of their operations for the three
months ended June 30, 2004 and 2003, and their cash flows for the three months
ended June 30, 2004 and 2003.
The results of operations for such periods are not necessarily indicative of
results expected for the full year or for any future period. These financial
statements should be read in conjunction with the audited consolidated financial
statements as of December 31, 2003 and related notes included in the Company's
Form 10-KSB, as amended, filed with the Securities and Exchange Commission
F-4
BASIS OF PREPARATION AND PRESENTATION
- -----------------------------------------
The accompanying consolidated financial statements have been prepared to reflect
the legal acquisition on August 8, 2003 of MT Marketing Int. Corp. (Marketing)
by MT Ultimate Healthcare Corp., (MT Ultimate) formerly JavaJuice.net. The
consolidated financial statements of MT Ultimate give effect to the acquisition
under which the shareholders of Marketing exchanged all of their common shares
in Marketing for common shares of MT Ultimate.
Notwithstanding its legal form, the acquisition has been accounted for as a
reverse takeover, as the former shareholders of Marketing own in aggregate
approximately 72% of the common shares of MT Ultimate, and are the majority
shareholders of the Company. Also, as MT Ultimate was an inactive company with
nominal net non-monetary assets, the acquisition has been accounted for as an
issuance of stock by Marketing accompanied by a recapitalization.
As required under reverse takeover accounting, these financial statements have
been issued under the name of MT Ultimate and reflect the share capital
structure of MT Ultimate. However, they reflect the financial statements of
Marketing and account for the acquisition as an acquisition of MT Ultimate by
Marketing. The consolidated financial statements therefore include:
(a) A consolidated balance sheet prepared from the audited balance sheets
of Ultimate and Marketing at June 30, 2004.
(b) Consolidated statements of operations, cash flows and changes in
shareholders' equity prepared from the audited statements of
operations, cash flows and changes in shareholders' equity (deficit)
of Marketing for the periods from January 1, 2004 to June 30, 2004
with a comparative figures for the similar period from January 1, 2003
to June 30, 2003.
PRINCIPLES OF CONSOLIDATION
- -----------------------------
The accompanying consolidated financial statements include the accounts of MT
Ultimate Healthcare Corp and it's wholly owned subsidiary MT Marketing Int.
Corp. (collectively "the Company"). Investments in which the Company does not
have a majority voting or financial controlling interest are accounted for under
the equity method of accounting unless its ownership constitutes less than a 20%
interest in such entity for which such investment would then be included in the
consolidated financial statements on the cost method. All significant
inter-company transactions and balances have been eliminated in consolidation.
F-5
ACCOUNTING METHOD
- ------------------
The Company's financial statements are prepared using the accrual method of
accounting. Revenues are recognized when earned and expenses when incurred.
Fixed assets are stated at cost. Depreciation and amortization using the
straight-line method for financial reporting purposes and accelerated methods
for income tax purposes. A total of $7,640 and $5,044 have been recorded in the
financial statements for the three month periods ended June 30, 2004 and June
30,2003.
EARNINGS PER COMMON SHARE
- -------------------------
The Company adopted Financial Accounting Standards (SFAS) No. 128, "Earnings Per
Share," which simplifies the computation of earnings per share requiring the
restatement of all prior periods.
Basic earnings per share are computed on the basis of the weighted average
number of common shares outstanding during each year.
Diluted earnings per share are computed on the basis of the weighted average
number of common shares and dilutive securities outstanding. Such securities
having an anti-dilutive effect on diluted earnings per share are excluded from
the calculation.
NOTE 2 - COMMON STOCK
- -----------------------
In February 2004, a total of 1,160,000 shares of common stock were issued for
services to consultants. These shares have been valued at $.25 per share for a
total of $290,000. In February, a $50,000 note was converted into 200,000 shares
of common stock. In June 2004, we received $100,000 in consideration for 400,000
shares of common stock. The 400,000 shares of common stock were issued after the
date of this report and were not accounted for by the Company for accounting
purposes as of June 30, 2004.
NOTE 3 - RELATED PARTIES
- --------------------------
The Company has significant related party transactions and/or relationships with
the Company's President, MacDonald Tudeme. Mr. Tudeme has guaranteed the
Company's bank indebtedness up to $200,000 without charging a fee. The Company
entered into a flexible lease for office space in Brooklyn, New York with its
majority shareholders and Directors, MacDonald Tudeme and Marguerite Tudeme, who
own the leased property. The lease commitmentof $550 per month was terminated
October 31, 2003. For the quarter ended March 31, 2004 the same related party
advanced the Company $17,614 on a demand note without interest.
F-6
NOTE 4 - NOTES PAYABLE
- ------------------------
The Company has a $200,000 SBA line of credit which is payable on demand on
January 29,2009. It bears interest at bank prime rate plus 1% for any
outstanding operating indebtedness. As of June 30, 2004 , the short term balance
was $44,983 and long term balance was $148,197.
The Company received $20,000, and $55,000 in connection with demand notes which
are due in September 2004 and bear interest at 5% per annum.
NOTE 5 -CAPITAL LEASES
- ----------------------
The company entered into lease arrangements to acquire equipment which has been
financed by a long-term liability. The liability recorded under the capital
lease represents the minimum lease payments payable of imputed interest at an
average of 19.0% per annum over three (3) years. The current portion of the
capital lease obligation is $8,568 and the long-term portion is $7,574.
NOTE 6 -TRADE RECEIVABLES
- --------------------------
A summary of net trade receivables as of June 30, 2004 shows that hospital
client receivables outstanding were $126,319, and the other receivables being
$220,769. The total net receivables outstanding as of June 30, 2004 were
$347,088
F-7
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
-------------------------------------------------
To the Board of Directors and Shareholders
MT Ultimate Healthcare Corp
New York, NY
We have audited the accompanying consolidated balance sheet of MT Ultimate
Healthcare Corp. (formerly Java Juice.net) ("Company") as of December 31, 2003
and the related consolidated statement of operations, changes in stockholders'
equity, and consolidated statement of cash flows for the year ended December 31,
2003 and 2002. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on the
financial statements based on our audit.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provides a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Company as of December 31,
2003, and the results of its operations and their cash flows for the years ended
December 31, 2003 and 2002 in conformity with accounting principles generally
accepted in the United States.
Clyde Bailey P.C.
March 16, 2004
Except for Note 9, May 18, 2004
San Antonio, Texas
F-1
MT ULTIMATE HEALTHCARE CORP
(FORMERLY JAVA JUICE.NET)
CONSOLIDATED BALANCE SHEET
As of December 31, 2003
A S S E T S
----------------
Current Assets
- --------------
Cash $ 54,758
Accounts Receivable, net of allowance 197,034
Other Current Assets 20,172
----------------
Total Current Assets 271,964
----------------
Property, plant and equipment, net of accumulated depreciation 131,859
----------------
Total Assets $ 403,823
================
L I A B I L I T I E S
----------------------
Current Liabilities
- ---------------------
Accounts Payable and accrued liabilities 59,867
Current Portion Capital Lease 7,502
----------------
Total Current Liabilities 67,369
----------------
Long-Term Liabilities:
Bank Note 188,697
Capital Leases 12,252
----------------
Total Long Term Liabilities 200,949
----------------
Total Liabilities 268,318
S T O C K H O L D E R S ' E Q U I T Y
-----------------------------------------
Common Stock 50,600
Additional Paid-in-Capital 149,658
Accumulated Deficit (64,753)
----------------
Total Stockholders' Equity 135,505
----------------
Total Liabilities and Stockholders' Equity $ 403,823
================
F-2
See accompanying notes to Financial Statements.
MT ULTIMATE HEALTHCARE CORP
(FORMERLY JAVA JUICE.NET)
STATEMENT OF OPERATIONS
Restated
FOR THE TWELVE MONTHS ENDED
---------------------------------------
DECEMBER 31, 2003 DECEMBER 31, 2002
------------------- ------------------
REVENUES:
- ---------
Revenues $ 1,159,237 $ 659,333
------------------- ------------------
Total Revenues 1,159,237 659,333
COST OF REVENUES:
- -----------------
Cost of Revenues $ 892,872 $ 508,144
------------------- ------------------
Gross Profit $ 266,365 $ 151,189
EXPENSES:
- ---------
Salaries & Wages 75,129 33,355
Professional Fees 77,902 10,036
Depreciation 23,920 15,527
Interest Expense 12,867 7,930
Operating Expenses 173,507 76,467
------------------- ------------------
Total Expenses 363,325 143,315
------------------- ------------------
Net loss from Operations (96,960) 7,874
PROVISION FOR INCOME TAXES:
- ---------------------------
Income Tax Benefit - -
------------------- ------------------
Net Income (Loss) $ (96,960) $ 7,874
=================== ==================
Basic and Diluted Earnings Per Common Share $ (0.00) $ 0.00
------------------- ------------------
Weighted Average number of Common Shares 39,383,333 34,000,000
=================== ==================
used in per share calculations
F-3
MT ULTIMATE HEALTHCARE CORP
(FORMERLY JAVAJUICE.NET)
CONSOLIDATED STATEMENT OF CASH FLOWS
Restated
FOR THE TWELVE MONTHS ENDED
------------------------------
DECEMBER 31, DECEMBER 31,
2003 2002
------------ ----------
Cash Flows from Operating Activities:
- ---------------------------------------
Net Income (Loss) $ (96,960) $ 7,874
Adjustments to Reconcile net loss to net cash
provided by (used in) operating activities:
Depreciation 12,877 15,527
Changes in operating assets and liabilities:
Accounts Receivable (62,472) (78,113)
Other Current Assets (20,702) -
Accounts Payable 14,094 17,078
------------ ----------
Net Cash Provided from Operating Activities (153,163) (37,634)
------------ ----------
Cash Flows from Investing Activities:
- ---------------------------------------
Property, plant and equipment (44,775) (18,103)
------------ ----------
Net Cash Used in Investing Activities (44,775) (18,103)
------------ ----------
Cash Flows from Financing Activities:
- ----------------------------------------
Bank Note 60,484 72,896
Capital Leases 8,522 -
Common Stock 150,000 13,500
------------ ----------
Net Cash Provided from Financing Activities 219,006 86,396
------------ ----------
Net Increase in Cash 21,068 30,659
------------ ----------
Cash Balance, Begin Period 33,690 3,031
------------ ----------
Cash Balance, End Period $ 54,758 $ 33,690
============ ==========
Supplemental Disclosures:
Cash Paid for interest $ 10,553 $ 7,930
============ ==========
Cash Paid for income taxes $ - $ -
============ ==========
See accompanying notes to Financial Statements.
F-4
MT ULTIMATE HEALTHCARE CORP
(FORMERLY JAVA JUICE.NET)
STATEMENT OF STOCKHOLDERS' EQUITY
Restated
$0.001 Paid-In Accumulated Stockholders'
Shares Par Value Capital Deficit Equity
----------- ----------- -------- --------- --------
Balance December 31, 2001 1,000 $ 1,000 $ 3,643 $ 24,333 $ 28,976
Stock Issued for Cash - 8,055 5,445 13,500
Net Loss 7,874 7,874
----------- ----------- -------- --------- --------
Balance December 31, 2002 1,000 $ 9,055 $ 9,088 $ 32,207 $ 50,350
Prior MT Marketing capital (1,000) (9,055) - 9,055 -
replaced by MT Ultimate capital
upon consolidation under reverse
takeover accounting
Current MT Marketing capital 50,000,000 50,000 32,115 (50,000) 32,115
replaced by MT Ultimate capital
upon consolidation under reverse
takeover accounting
Transferred to Additional Paid in (40,945) 40,945 -
Capital
Stock Issued for Debt 600,000 600 149,400 150,000
Net Loss (96,960) (96,960)
----------- ----------- -------- --------- --------
Balance December 31, 2003 50,600,000 $ 50,600 $149,658 $(64,753) $135,505
=========== =========== ======== ========= ========
MT Ultimate Healthcare Corp
(formerly Java Juice.net)
Notes to Financial Statements
December 31, 2003
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- -----------------------------------------------------
ORGANIZATION
- ------------
The Company was originally incorporated under the laws of the State of Nevada on
September 13, 2001 for the purpose to promote and carry on any lawful business
for which a corporation may be incorporated under the laws of the State of
Nevada. The company has a total of 400,000,000 authorized shares with a par
value of $.001 per share and with 50,600,000 shares issued and outstanding as of
December 31, 2003. The Company filed an amended Articles of Incorporation with
the State of Nevada on August 15, 2003 to change the name to MT Ultimate
Healthcare Corp from Java Juice.net and to increase the authorized shares to
400,000,000 common shares. Also, the Company agreed to a 80 to 1 forward split
of the shares in this amended filing. On September 29, 2003, the Company agreed
to a 1 for 4 reverse split. These financial statements reflect these filings.
BASIS OF PREPARATION AND PRESENTATION:
The accompanying consolidated financial statements have been prepared to reflect
the legal acquisition on August 8, 2003 of MT Marketing International Inc.
("Marketing") by MT Ultimate Healthcare Inc. formerly Java Juice.net
("Ultimate") (the "Acquisition"). The consolidated financial statements of
Ultimate give effect to the Acquisition under which the shareholders of
Marketing exchanged all of their common shares of Marketing for common shares of
Ultimate.
Notwithstanding its legal form, the Acquisition has been accounted for as a
reverse takeover, as the former shareholders of Marketing own in aggregate
approximately 72% of the common shares of Ultimate, and so are now the majority
shareholders of Ultimate. Also, as Ultimate was an inactive company with
nominal net non-monetary assets, the Acquisition has been accounted for as an
issuance of stock by Marketing accompanied by a recapitalization.
As required under reverse takeover accounting, these financial statements have
been issued under the name of Ultimate and reflect the share capital structure
of Ultimate. However, they reflect the financial statements of Marketing and
account for the Acquisition as an acquisition of Ultimate by Marketing. The
consolidated financial statements therefore include:
(a) a consolidated balance sheet prepared from the audited balance sheets of
Ultimate and Marketing as at December 31, 2003.
(b) consolidated statements of operations, cash flows and changes in
shareholders' equity prepared from the audited statements of operations,
cash flows and changes in shareholders' equity (deficit) of Marketing for
the periods from January 1, 2002 to December 31, 2003. The results of
operations, cash flows and changes in shareholders' equity (deficit) of
Ultimate are included commencing July 1, 2003, the effective date of the
Acquisition.
F-6
PRINCIPLES OF CONSOLIDATION
- -----------------------------
The accompanying consolidated financial statements include the accounts of MT
Ultimate Healthcare Corp and its wholly owned subsidiary MT Marketing
International Inc. collectively "the Company"). Investments in which the
Company does not have a majority voting or financial controlling interest are
accounted for under the equity method of accounting unless its ownership
constitutes less than a 20% interest in such entity for which such investment
would then be included in the consolidated financial statements on the cost
method. All significant inter-company transactions and balances have been
eliminated in consolidation.
FEDERAL INCOME TAX
- --------------------
The Company has adopted the provisions of Financial Accounting Standards Board
Statement No. 109, Accounting for Income Taxes. The Company accounts for income
taxes pursuant to the provisions of the Financial Accounting Standards Board
Statement No. 109, "Accounting for Income Taxes", which requires an asset and
liability approach to calculating deferred income taxes. The asset and
liability approach requires the recognition of deferred tax liabilities and
assets for the expected future tax consequences of temporary differences between
the carrying amounts and the tax basis of assets and liabilities.
USE OF ESTIMATES
- ------------------
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure on
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
ACCOUNTING METHOD
- ------------------
The Company's financial statements are prepared using the accrual method of
accounting. Revenues are recognized when earned and expenses when incurred.
Fixed assets are stated at cost. Depreciation and amortization using the
straight-line method for financial reporting purposes and accelerated methods
for income tax purposes. A total of $12,877 has been recorded in the financial
statements for the six months period ended December 31, 2003.
EARNINGS PER COMMON SHARE
- -------------------------
The Company adopted Financial Accounting Standards (SFAS) No. 128, "Earnings
Per Share," which simplifies the computation of earnings per share requiring the
restatement of all prior periods.
Basic earnings per share are computed on the basis of the weighted average
number of common shares outstanding during each year.
Diluted earnings per share are computed on the basis of the weighted average
number of common shares and dilutive securities outstanding. Dilutive securities
having an anti-dilutive effect on diluted earnings per share are excluded from
the calculation.
F-7
ADVERTISING
- -----------
The Company expensed Advertising and Marketing expenditures in the amount of
$9,131 for the year ended December 31, 2003.
CASH AND CASH EQUIVALENTS
- ----------------------------
The Company considers all highly liquid debt instruments with a maturity of
three months or less at the time of purchase to be cash equivalents. Cash and
cash equivalents consist of checking accounts and money market funds.
FAIR VALUE OF FINANCIAL INSTRUMENTS
- ---------------------------------------
The carrying amounts of financial instruments including cash and cash
equivalents, accounts receivable and payable, accrued and other current
liabilities and current maturities of long-term debt approximate fair value due
to their short maturity.
RECENT ACCOUNTING PRONOUNCEMENTS
- ----------------------------------
In November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting
and Disclosure Requirements for Guarantees, including Indirect Guarantees of
Indebtedness of Others" ("Interpretation No. 45"). Interpretation No. 45
elaborates on the existing disclosure requirements for most guarantees,
including loan guarantees such as standby letters of credit. It also clarifies
that at the time a company issues a guarantee, the company must recognize an
initial liability for the fair market value of the obligations it assumes under
that guarantee and must disclose that information in its interim and annual
financial statements. The initial recognition and measurement provisions of
Interpretation No. 45 apply on a prospective basis to guarantees issued or
modified after December 31, 2002. Interpretation No. 45 did not have an effect
on the financial statements.
In January 2003, the FASB issued Interpretation No. 46, "Consolidation of
Variable Interest Entities" ("Interpretation No. 46"), that clarifies the
application of Accounting Research Bulletin No. 51, "Consolidated Financial
Statements," to certain entities in which equity investors do not have the
characteristics of a controlling financial interest or do not have sufficient
equity at risk for the entity to finance its activities without additional
subordinated financial support from other parties. Interpretation No. 46 is
applicable immediately for variable interest entities created after January 31,
2003. For variable interest entities created prior to January 31, 2003, the
provisions of Interpretation No. 46 are applicable no later than July 1, 2003.
Interpretation No. 46 did not have an effect on the financial statements.
In December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation -- Transition and Disclosure, an amendment of FASB Statement No.
123" ("SFAS 148"). This Statement amends SFAS 123 to provide alternative methods
of transition for a voluntary change to the fair value method of accounting for
stock-based employee compensation. In addition, SFAS 148 amends the disclosure
requirements of SFAS 123 to require prominent disclosures in both annual and
interim financial statements. Certain of the disclosure modifications are
required for fiscal years ending after December 15, 2002 and are included in the
notes to these consolidated financial statements.
F-8
Statement of Financial Accounting Standards SFAS No. 149, "Amendment of
Statement 133 on Derivative Instruments and Hedging Activities", SFAS No. 150,
"Accounting for Certain Financial Instruments with Characteristics of both
Liabilities and Equity", were recently issued. SFAS No, 149, and 150 have no
current applicability to the Company or their effect on the financial statements
would not have been significant.
NOTE 2 - EQUIPMENT
- ------------------
ACCUMULATED
COST DEPRECIATION NETBOOK
VALUE
-------------------------------------
Furniture and equipment $ 110,289 $ 31,151 $ 79,138
Computer equipment 20,956 7,604 13,352
Leasehold Improvements 48,607 9,238 39,369
software -------------------------------------
$ 179,852 $ 47,993 $131,859
=====================================
A total of $23,920 and $15,527 has been recognized as depreciation expense for
the period ended December 31, 2003 and 2002.
NOTE 3 - COMMON STOCK
- -----------------------
On August 8, 2003 the Company acquired MT Marketing International Corp ("MT
Marketing") as an operating subsidiary for 16,000,000 shares of common stock and
accounted for the acquisition as a reverse merger or a recapitalization.
The Company agreed to a 80 to 1 forward split of the shares on August 15, 2003.
On September 29, 2003, the Company agreed to a 1 for 4 reverse split. These
financial statements reflect these filings.
In December of 2003, the Company converted $150,000 of debt to equity by issuing
600,000 shares of common stock to the debtor.
F-9
NOTE 4- FEDERAL INCOME TAX
- -----------------------------
The components of the provision for income tax (expense) benefits are as
follows:
Year Ended December 31,
-----------------------
2003 2002
---- ----
Deferred:
Federal ($ 32,966) $ 2,677
State ( 4,363) 354
----------------- ------------------
($ 37,329) $ 3,031
----------------- ------------------
Such income tax (expense) benefits are included in the accompanying consolidated
financial statements as follows:
Year Ended December 31,
-----------------------
2003 2002
---- ----
Income from operations ($ 37,329) $ 3,031
Non-Deductible Expenses
and Non-Taxable Income -0- -0-
------------------- -------------------
($ 37,329) $ 3,031
The above provision has been calculated based on Federal and State statutory
rates in the adjusted rates of 34% for Federal and 4.5% for State tax rates.
Temporary differences, which give rise to deferred tax assets and liabilities
are as follows:
Year Ended December 31,
-----------------------
2003 2002
---- ----
Deferred tax assets:
Net Operating Loss ($ 37,329) $ 3,031
------------------- -------------------
Net deferred tax
assets (liabilities) ($ 37,329) $ 3,031
=================== ===================
NOTE 4- FEDERAL INCOME TAX (CON'T)
- -------------------------------------
Net deferred tax assets and liabilities have been presented in the financial
statements as follows:
Year Ended December 31,
-----------------------
2003 2002
---- ----
Deferred income taxes - current $ ( 37,329) $ 3,031
Valuation Allowance 37,329 ( 3,031)
--------------- ----------------
Net deferred tax assets $ -0- $ -0-
================ =================
The valuation allowance offsets the net deferred tax asset for which there is no
assurance of recovery. The change in the valuation allowance for the years ended
December 31, 2003 and 2002 totaled $37,329 and ($3,031), respectively. The net
operating loss carry- forward begins to expire in year 2022. The valuation
allowance will be evaluated at the end of each year, considering positive and
negative evidence about whether the deferred tax asset will be realized. At that
time, the allowance will either be increased or reduced; reduction could result
in the complete elimination of the allowance if positive evidence indicates that
the value of the deferred tax assets is no longer impaired and the allowance is
no longer required.
NOTE 5 - RELATED PARTIES
- --------------------------
The Company has significant related party transactions and/or relationships with
the Company's President, MacDonald Tudeme. Mr. Tudeme have guaranteed the
Company's bank indebtedness up to $200,000 without charging a fee.The Company
entered into a flexible lease for office space in Brooklyn, New York with its
majority shareholders and Directors, MacDonald Tudeme and Marguerite Tudeme, who
own the leased property. The lease commitment as $550 per month and was
terminated October 31, 2003.
NOTE 6 - NOTES PAYABLE AND CAPITAL LEASES
- -------------------------------------------
The Company is indebted to the Community Capital Bank in Brooklyn NY for two
loans underwritten by the SBA Administration. One of the loans is a line of
credit granted on August 29, 2003 with a variable interest rate with the
Accounts Receivable of the Company as security for the loan. As of December 31,
2003, the balance of the line of credit is $47,500 and the rate of interest is
6%. The loan matures on January 29, 2009.
F-10
NOTE 6 - NOTES PAYABLE AND CAPITAL LEASES (CON'T)
- ---------------------------------------------------
The other loan has a balance outstanding as of December 31, 2003 of $141,197.
The note is a line of credit note that has a variable interest rate and as of
December 31, 2003 carried an interest rate of 5%. The note is secured by a
floating charge over all of the assets of the Company. The note matures on
January 1, 2005.
There are several leases for computers and telephone equipment that are being
capitalized. The balance of the notes as of December 31, 2003 is $19,754 with
various interest rates from 8% to 14% and matures in 36 to 48 months.
NOTE 7 - ECONOMIC DEPENDENCY
- -----------------------------
The Company received a substantial portion of its revenues from one customer.
In 2003 and 2002, revenues from that customer were $852,051 and $335,757
respectively. At December 31, 2003 and 2002, accounts receivable from that
customer were $158,021 and $95,840. This represents 73% of Gross Revenues
and 80% of total Account Receivable and Notes Receivable for 2003.
NOTE 8 - LEASES
- ---------------
The Company entered into a new office lease effective November 1, 2003. The term
of the lease is five year and expires October 31, 2008. The base monthly rate is
$3,500 per month and raises to $3,939 per month at the end of the term of the
lease. The Company placed a #11,918 deposit as security for the lease. A second
office lease is in effect for an office in the Bronx NY that started November 1,
2002 and expires on November 1, 2007. The monthly rental rated started at $650
to $850 per month at the expiration of the lease. The Company has also signed a
third lease in Baldwin NY effective January 1, 2004 that expires November 30,
2008. The base monthly rental rate is $1,300.
Minimum lease payments under leases at December 31, 2003, are as follows:
2004 $66,310
2005 68,126
2006 70,033
2007 71,073
Future Years 3,692
F-11
NOTE 9 - RESTATEMENT
- --------------------
Subsequent to the issuance of the Company's December 31, 2003 financial
statements, management determined that it should restate its year end December
31, 2003 and 2002 financial statements and related disclosures to reflect the
acquisition of MT Marketing Inc. as a reverse merger or recapitalization instead
of a "purchase" acquisition. Pursuant to the rules of reverse merger accounting
the historical activity of the acquired company (Marketing) is shown in the
statements of operations and cash flows for the twelve months ended December 31,
2003 and 2002.
A summary of the significant effects of the restatement is as follows;
December 31, 2003
- -----------------
As Previously As
Reported Restated
------------------------------
Goodwill 24,743 -0-
Additional Paid In Capital 239,400 149,658
Accumulated Deficit (129,752) ( 65,753)
Revenues 636,978 1,159,237
Cost of Revenues 507,486 892,872
Expenses 251,891 363,325
Income (Loss) from Operations (122,399) ( 96,960)
December 31, 2002
- -----------------
Revenues -0- 659,333
Cost of Revenues - 0- 508,144
Expenses 5,384 143,315
Income (Loss) from Operations ( 5,384) 7,874
F-12
Changes in and Disagreements with Accountants on
------------------------------------------------
Accounting and Financial Disclosure
-----------------------------------
None.
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Our Articles of Incorporation, as amended, and Bylaws provide for
indemnification from liability of our officers and directors to the fullest
extent permitted by Nevada General Corporation Law ("Nevada Law"), including
future amendments to Nevada Law. Nevada Law generally provides that we may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (hereinafter a "Proceeding") by
reason of the fact that the person is or was a director, officer, employee or
agent of the Company, or is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses, including attorneys' fees,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by the person in connection with the Proceeding upon a determination by our
stockholders, a majority of our disinterested directors or independent legal
counsel that indemnification is proper in the circumstances, provided that: a)
the it is not proven that the person's act or failure to act constituted a
breach of the person's fiduciary duties as an officer or director, and the
person's breach of those duties involved intentional misconduct, fraud or a
knowing violation of law (the "Provision for Limited Liability"); or b) the
person acted in good faith and in a manner which the person reasonably believed
to be in or not opposed to the best interests of the Company, and, with respect
to any criminal action or proceeding, the person had no reasonable cause to
believe that the person's conduct was unlawful. Such an indemnification payment
might deplete the Company's assets. Nevada Law also generally limits the
liability of our officers and directors for any damages as a result of any act
or failure to act in the officer's or director's capacity as an officer or
director subject to the Provision for Limited Liability. Thus, the Company may
be prevented from recovering damages for certain alleged errors or omissions by
the officers and directors for liabilities incurred in connection with their
good faith acts for the Company.
OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the estimated expenses to be incurred in
connection with the distribution of the securities being registered. The
expenses shall be paid by the Registrant.
SEC Registration Fee $ 603
Legal Fees and Expenses 35,000*
Accounting Fees and Expenses 10,000*
Miscellaneous 5,000*
------
TOTAL $ 50,603*
=======
* Estimated.
-33-
RECENT SALES OF UNREGISTERED SECURITIES
In March 2002, the Company issued a total of 14,000,000 shares of Common
Stock which were not registered under the Act to 33 investors in exchange for
$35,000, pursuant to an offering conducted under an exemption provided by Rule
504 of Regulation D, promulgated under the Act, as amended. The offering was
registered for sale by the Nevada Secretary of State Securities Division on
November 20, 2001. The shares were all sold to unaccredited investors who were
friends, family members, acquaintances and/or business associates of our sole
officer and director and of the registered sales agent.
On September 2, 2003, the Company issued 16,000,000 shares of Common Stock
which were not registered under the Act pursuant to an Exchange Agreement
whereby MT became a wholly-owned subsidiary of the Company. The Company claims
the exemption from registration afforded by Rule 506 of Regulation D under the
Act.
On December 4, 2003, the Company issued an aggregate of 600,000 shares of
Common Stock which were not registered under the Act to four entities in
exchange for the cancellation of $150,000 of indebtedness. The Company claims
an exemption from registration afforded by Section 4(2) of the Act since the
foregoing issuances did not involve a public offering, the recipient took the
shares for investment and not resale and the Company took appropriate measures
to restrict transfer. No underwriters or agents were involved in the foregoing
issuances and no underwriting discounts or commissions were paid by the Company.
On January 15, 2004, the Company issued 100,000 shares, and on February 10,
2004, the Company issued 400,000 shares (or an aggregate of 500,000 shares) of
Common Stock which were not registered under the Act to an individual as
additional consideration for entering into a Consulting Services Agreement with
the Company. The Company claims an exemption from registration afforded by
Section 4(2) of the Act since the foregoing issuances did not involve a public
offering, the recipients took the shares for investment and not resale and the
Company took appropriate measures to restrict transfer. No underwriters or
agents were involved in the foregoing issuances and no underwriting discounts or
commissions were paid by the Company.
On February 10, 2004, the Company issued an aggregate of 760,000 shares of
Common Stock which were not registered under the Act to three individuals
consisting of 500,000 shares as additional consideration for an employment
agreement, 250,000 shares for consulting services, and 10,000 shares as an
incentive to join the Company as its first Director of Patient Services. The
Company claims an exemption from registration afforded by Section 4(2) of the
Act since the foregoing issuances did not involve a public offering, the
recipients took the shares for investment and not resale and the Company took
appropriate measures to restrict transfer. No underwriters or agents were
involved in the foregoing issuances and no underwriting discounts or commissions
were paid by the Company.
On February 24, 2004, the Company issued 200,000 shares of Common Stock
which were not registered under the Act to an unrelated entity to convert
$50,000 of indebtedness that the Company owed to such entity into equity. The
Company claims an exemption from registration afforded by Section 4(2) of the
Act since the foregoing issuances did not involve a public offering, the
recipients took the shares for investment and not resale and the Company took
appropriate measures to restrict transfer. No underwriters or agents were
involved in the foregoing issuances and no underwriting discounts or commissions
were paid by the Company.
In June 2004, the Company agreed to issue 400,000 shares of Common Stock
which were not registered under the Act to an entity in consideration for
$100,000. Subsequent to June 30, 2004, the shares were issued, but for
accounting purposes they were not treated as issued. The Company claims an
exemption from registration afforded by Section 4(2) of the Act since the
foregoing issuances did not involve a public offering, the recipients took the
shares for investment and not resale and the Company took appropriate measures
to restrict transfer. No underwriters or agents were involved in the foregoing
issuances and no underwriting discounts or commissions were paid by the Company.
In July 2004, the Company issued 500,000 shares of Common Stock which
were not registered under the Act to an individual in consideration for
consulting services rendered from September 2003 to the present. The Company
claims an exemption from registration afforded by Section 4(2) of the Act since
the foregoing issuances did not involve a public offering, the recipients took
the shares for investment and not resale and the Company took appropriate
measures to restrict transfer. No underwriters or agents were involved in the
foregoing issuances and no underwriting discounts or commissions were paid by
the Company.
In August 2004, the Company issued 200,000 shares of Common Stock which
were not registered under the Act to Wayne F. Richardson for his services as a
director of the Company and the Company's Chief Financial Officer. The Company
claims an exemption from registration afforded by Section 4(2) of the Act since
the foregoing issuance did not involve a public offering, the recipient took the
shares for investment and not resale and the Company took appropriate measures
to restrict transfer. No underwriters or agents were involved in the foregoing
issuance and no underwriting discounts or commissions were paid by the Company.
In August 2004, the Company issued an aggregate of 400,000 shares of Common
Stock which were not registered under the Act consisting of 200,000 shares to
the former BP shareholder in exchange for 100% of the common stock of BP, and
200,000 to an individual unrelated to the Company as consideration for
consulting services. The Company claims an exemption from registration afforded
by Section 4(2) of the Act since the foregoing issuances did not involve a
public offering, the recipients took the shares for investment and not resale
and the Company took appropriate measures to restrict transfer. No underwriters
or agents were involved in the foregoing issuances and no underwriting discounts
or commissions were paid by the Company.
In August 2004, we entered into a Securities Purchase Agreement with
Partners, Offshore, Qualified and New Millennium for the sale of (i) an
aggregate of $700,000 of Convertible Notes that, as of the Filing Date, could be
converted into approximately 6,194,690 shares of Common Stock at $0.113 per
share; and (ii) Warrants to purchase 700,000 shares of Common Stock at $0.45 per
share. We have received $500,000 and, subject to our satisfaction of certain
conditions described in the section entitled "RISK FACTORS", will receive an
additional $200,000 upon the effectiveness of the registration statement to
which this Prospectus is a part. The Company claims an exemption from
registration afforded by Section 4(2) of the Act since the foregoing issuances
did not involve a public offering, the recipients had access to information that
would be included in a registration statement, took the shares for investment
and not resale and the Company took appropriate measures to restrict transfer.
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EXHIBITS
INDEX TO EXHIBITS
-----------------
EXHIBIT NO. IDENTIFICATION OF EXHIBIT
3.1(1) Articles of Incorporation
3.2(2) Articles of Amendment to Articles of Incorporation
3.3(3) Articles of Amendment to Articles of Incorporation
3.4(1) Bylaws
5.1(4) Opinion and consent of David M. Loev, Attorney at Law re: the
legality of the shares being registered
10.1(4) Securities Purchase Agreement dated August 31, 2004
10.2(4) Callable Secured Convertible Note with AJW Partners, LLC,
dated August 31, 2004
10.3(4) Callable Secured Convertible Note with AJW Offshore, Ltd.,
dated August 31, 2004
10.4(4) Callable Secured Convertible Note with AJW Qualified Partners,
LLC, dated August 31, 2004
10.5(4) Callable Secured Convertible Note with New Millennium Capital
Partners II, LLC, dated August 31, 2004
10.6(4) Stock Purchase Warrant with AJW Partners, LLC, dated
August 31, 2004
10.7(4) Stock Purchase Warrant with AJW Offshore, Ltd., dated
August 31, 2004
10.8(4) Stock Purchase Warrant with AJW Qualified Partners, LLC, dated
August 31, 2004
10.9(4) Stock Purchase Warrant with New Millennium Capital
Partners II, LLC, dated August 31, 2004
10.10(4) Registration Rights Agreement dated August 31, 2004
10.11(4) Security Agreement dated August 31, 2004
10.12(4) Intellectual Property Security Agreement dated August 31, 2004
10.13(4) Engagement Letter with Wayne F. Richardson
10.14(4) Guarantee and Pledge Agreement dated August 31, 2004
10.15 (6) Agreement and Plan of Acquisition with Abundant Nursing, Inc.
23.1(4) Consent of Clyde Bailey, P.C.
23.2(5) Consent of David M. Loev, Attorney at Law
(included in Exhibit 5.1)
(1) Filed as Exhibits 3(i) and 3(ii), respectively, to the registration
statement on Form 10-SB12G filed on July 15, 2002, and incorporated herein
by reference.
(2) Filed as Exhibit 3.1 to the report on Form 8-K filed on September 2, 2003,
and incorporated herein by reference.
(3) Filed as Exhibit 3.1 to the report on Form 8-K filed on September 30, 2003,
and incorporated herein by reference.
(4) Filed herewith.
(5) Contained in Exhibit 5.1.
(6) Filed as Exhibit 2.1 to the Form 8-K filed on October 5, 2004.
UNDERTAKINGS
(a) 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 to:
i. Include any prospectus required by Section 10(a)(3) of the
Securities Act;
ii. Reflect in the prospectus any facts or events which, individually
or together, represent a fundamental change in the information 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 was registered) and any deviation from the low or high end
of the estimated maximum offering 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
iii. Include any additional or changed material on the plan of
distribution.
(2) For determining any liability under the Securities Act, to 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 that remain unsold at the end of the offering.
(4) For determining any liability under the Securities Act, to treat the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1)
or (4), or 497(h) under the Securities Act as part of this
registration statement as of the time the Commission declared it
effective.
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(5) For determining any liability under the Securities Act, to treat each
post-effective amendment that contains a form of prospectus as a new
registration statement relating to the securities offered in the
registration statement, and that offering of the securities at that
time as the initial bona fide offering of those securities.
(b) Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant 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, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
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SIGNATURES
----------
In accordance with 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, in the City of New
York, State of New York on October 5, 2004.
MT ULTIMATE HEALTHCARE CORP.
By: /s/ MacDonald Tudeme
--------------------
MacDonald S. Tudeme
Chief Executive Officer
This registration statement has been signed by the following persons in the
capacities and on the dates indicated:
Signature Title Date
- --------- ----- ----
/s/ MacDonald S. Tudeme Chief Executive Officer, October 5, 2004
- ----------------------- President, Treasurer, and
MacDonald S. Tudeme Director
/s/ Wayne F. Richardson Chief Financial Officer, October 5, 2004
- ----------------------- Principal Accounting Officer,
Wayne F. Richardson and Director
/s/ Marguerite M. Tudeme Secretary and Director October 5, 2004
- ------------------------
Marguerite M. Tudeme
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