As filed with the Securities and Exchange Commission on February 7, 2000
Registration No. 333-86741
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
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(Exact name of registrant as specified in its charter)
Florida 59-3203301
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
186 P.C.N.A. Parkway, Lake Helen, Florida 32744
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(Address of Principal Executive Offices)
Peter S. Balise, President
The Publishing Company of North America, Inc.
186 P.C.N.A. Parkway
Lake Helen, FL 32744
(904) 228-1000
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(Name, address, and telephone number of agent of service)
Please send a copy of all communication also to:
Michael D. Harris, Esq.
Michael Harris, P.A.
1645 Palm Beach Lakes Boulevard, Suite 550
West Palm Beach, Florida 33401
(561) 478-7077
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALES TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
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 of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, 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, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] ________________
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_] _________________
If delivery of this prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
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The registrant hereby amends this registration statement pursuant to Rule 429 on
the 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 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.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECUTITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED FEBRUARY 7, 2000
PROSPECTUS
225,000 SHARES OF COMMON STOCK
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
INVESTING IN THE COMMON STOCK INVOLVES SUBSTANTIAL RISKS. SEE "RISK FACTORS"
BEGINNING ON PAGE 4.
This prospectus relates to the public offering of up to 225,000 shares of our
common stock, which are being offered for sale by a selling stockholder.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is _________________, 2000
The Publishing Company of North America, Inc.
186 P.C.N.A. Parkway
Lake Helen, FL 32744
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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. WE 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 THE
DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF DELIVERY OF THIS PROSPECTUS
OR OF ANY SALE OF COMMON STOCK.
TABLE OF CONTENTS
Prospectus Summary ............................................... 2
Risk Factors ..................................................... 4
Forward-Looking Statements ....................................... 9
Recent Developments .............................................. 9
Where You Can Find More Information .............................. 13
Selling Stockholder .............................................. 14
Plan of Distribution ............................................. 14
Legal Matters .................................................... 15
Experts .......................................................... 15
PROSPECTUS SUMMARY
This summary highlights certain information contained later in this
prospectus or in the documents which we are incorporating by reference. This
summary may not contain all the information you should consider before investing
in our common stock. You should read the entire prospectus carefully including
the "Risk Factors" which follow.
THE COMPANY
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OUR BUSINESS ................... We are a leading publisher of official bar
association membership directories. We also
publish membership directories for medical
associations. Over approximately the last
year, we have intentionally reduced the number
of directories we publish in order to achieve
profitability from our traditional publishing
business. We believe that the publication of
bar association and medical association
membership directories has limited growth
opportunities.
At the same time, the Internet has opened a
new opportunity for us to provide information,
sell advertising and offer goods
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and services to the legal community and
others. In 1999, we launched our Internet
strategy featuring three websites consisting
of a legal portal, an online directory of
experts and vendors selling products and
services to the legal community and an
e-commerce store. As described later in this
prospectus under "Recent Developments", we are
not relying upon the e-commerce store at this
time, and we are considering expanding our
Internet strategy to meet the needs of the
legal community and consumers. We believe the
growing acceptance of the Internet creates a
potential business opportunity; we also
believe we can leverage upon our relationships
with bar associations, our print directory
clients and others to promote our online
websites.
In late 1999, we acquired the Internet address
"attorneys.com." More recently, our board of
directors adopted a resolution to change our
corporate name from The Publishing Company of
North America, Inc. to Attorneys.com, Inc. We
intend to present this resolution at our
annual shareholders meeting this Spring,
expect that it will be approved and will
officially change our name to Attorneys.com,
Inc. at that time.
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ABOUT THE PUBLISHING COMPANY
OF NORTH AMERICA ............... We are a Florida corporation organized in
1993. Our offices are located at:
186 P.C.N.A. Parkway
Lake Helen, FL 32744-0280
(904) 228-1000
Information about us is available on the
Internet at www.pcna.com. The information
contained at this website is not part of this
prospectus.
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THE OFFERING
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COMMON STOCK OFFERED ........... We are not offering for sale any of the shares
of common stock. 225,000 shares are being
offered for sale by InterWest Associates upon
the exercise of warrants it holds. See
"Selling Stockholder".
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RISK FACTORS ................... Your purchase of our common stock involves a
high degree of risk.
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RISK FACTORS
Investing in our common stock involves a high degree of risk. You
should not purchase our common stock unless you can afford a complete loss of
your investment. You should consider the following risks as well as the
information contained in the reports and proxy statement that are incorporated
in this prospectus.
RISKS RELATING TO OUR BUSINESS
IF WE CANNOT EFFECTIVELY MANAGE OUR GROWTH, WE MAY INCUR OPERATING LOSSES
We recently launched our new Internet business. If our Internet
business grows, this growth may place a further strain on our administrative,
operational and financial resources and we may again lose money. We have limited
management depth, and if we grow substantially in the future, we may not be able
to hire the necessary senior and middle management personnel necessary to
implement our programs. Following the closing of our initial public offering in
the Spring of 1996, our print business grew. However, we encountered operational
difficulties and sustained operating losses for a long period of time. For the
years ended December 31, 1997 and 1998, we sustained operating losses of
$405,811 and $627,134 and net losses of $346,242 and $885,337.
IF WE SUFFER MATERIAL LOSSES IN THE FUTURE OUR STOCK MAY BE DELISTED FROM NASDAQ
Our stock currently meets Nasdaq listing requirements. If we sustain
material losses in the future, there can be no assurance that our stock will
meet the criteria for continued listing. If we are unable to satisfy Nasdaq's
listing requirements, our stock may be delisted from Nasdaq, reducing our
liquidity and our stock price.
BECAUSE WE DEPEND UPON THIRD PARTIES IN BOTH OUR PRINT AND INTERNET BUSINESSES,
THEIR FAILURE TO TIMELY AND RELIABLY PROVIDE SERVICES TO US MAY RESULT IN THE
LOSS OF REVENUES
In our print directory business, we subcontract all of the printing of
our bar and medical association directories to independent printing companies.
If printers delay the delivery of directories, this could have the consequence
of causing bar and medical associations, for which we are late in delivering
directories, to terminate their agreements with us or of causing advertisers to
cancel their media agreements with us and request refunds of prepaid fees.
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Advertisers who are affected by delays in the delivery of directories, may also
decline future print and Internet advertising opportunities with us.
Our Internet business is similarly dependent upon third parties to
provide all of the content and host and maintain our websites. To the extent
that any or all of these third parties fail to meet their obligations to us,
existing and prospective advertisers may lose confidence in our ability to
attract and maintain a consistent Internet presence. Also, users of our websites
would likely not visit our websites. Additionally, problems we encountered with
Value America, which operates our e-commerce website, have prevented us from
marketing this website to bar associations and their members. Due to these
problems with Value America, we do not anticipate future online revenues from
it. Moreover, it may reduce our future online revenues from third parties.
WE WILL FACE INTENSE COMPETITION IN ALL ASPECTS OF OUR BUSINESS THAT MAY RESULT
IN FUTURE OPERATING LOSSES
WE FACE COMPETITION FOR CONTRACTS FOR PRINT DIRECTORIES
We compete for print directory contracts with a number of other
publishers of bar membership directories, including Legal Directories Publishing
Company, a publisher of state bar directories, and Martindale-Hubbell which
publishes what is considered to be the premier legal directory.
Martindale-Hubbell is a well-recognized name to lawyers, which gives it an
important competitive advantage. If we cannot compete effectively, we may suffer
a significant decline in our print directory business in the future.
OUR NEW ONLINE BUSINESS FACES INTENSE COMPETITION
In our new online business, we face enormous competition from Internet
companies, a few of which are oriented towards the legal market. These
competitors are spending substantial sums advertising their websites and
developing a brand-name recognition. These companies also have significant other
competitive advantages including management depth. Because of our lack of
significant assets, we may not be able to compete effectively in our online
business. There are low barriers to entry, and competitors can launch new
websites at a relatively low cost. We believe that our ability to compete online
will be affected, among other factors, by our ability to:
o develop and maintain a sufficiently large base of legal professionals
and others who regularly visit our websites;
o develop regular visitors to our websites based upon the features we
offer, including attractive e-commerce products and services; and
o provide visitors to America's Legal Superstore with incentives to order
goods and services online and participate in e-commerce transactions.
Please see the risk factors beginning in the middle of page 6 that describe the
hurdles our Internet business faces.
IF OUR CHIEF EXECUTIVE OFFICER IS NOT AVAILABLE, WE MAY LOSE PRINT DIRECTORY
BUSINESS AND BE UNABLE TO ATTRACT FUTURE BUSINESS
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We rely heavily upon Mr. Peter S. Balise, our chief executive officer,
in attracting and maintaining print directory agreements with bar and medical
associations. If Mr. Balise resigns or is otherwise unavailable, we may be
unable to renew existing directory agreements and attract new agreements with
bar and medical associations. We believe Mr. Balise's relationships with bar
association professionals are an important advantage and that it would be
difficult and expensive to replace him.
IF WE, OR OUR VENDORS, ARE NOT YEAR 2000 COMPLIANT, OUR BUSINESS MAY BE
DISRUPTED RESULTING IN A LOSS OF REVENUES AND OUR INCURRING SIGNIFICANT LOSSES
We are dependent, to a substantial degree, upon the proper functioning
of our computer hardware, software and other information technology systems, and
on the proper functioning of the systems of our suppliers and service providers.
A failure of these systems to correctly recognize dates beyond December 31,
1999, could materially disrupt our operations, delay the delivery of directories
and prevent persons from using our websites. Disruptions or, in the worst case
scenario, a complete failure of all of our services, also may arise as a result
of us or third parties not being Year 2000 compliant. Any malfunction in our
information technology systems, or those of our suppliers or third parties,
could result in a loss of revenues and our incurring significant losses.
RISKS RELATED TO THE INTERNET
OUR LIMITED FINANCIAL RESOURCES MAY PREVENT US FROM ATTRACTING ENOUGH USERS OF
OUR WEBSITES RESULTING IN LIMITED REVENUES FROM THE INTERNET
We believe that our core business of publishing official bar and
medical association directories has limited growth opportunities. For this
reason, we are devoting substantial attention to our new Internet business. We
are currently witnessing a period in which well-capitalized businesses are
spending enormous sums advertising their websites. We have limited resources and
cannot incur any significant expenses in advertising our websites. For this
reason, we may not be successful in generating substantial revenues from our
websites.
BECAUSE WE HAVE LIMITED INTERNET EXPERIENCE AND OUR INTERNET MODEL IS UNPROVEN,
OUR INTERNET BUSINESS MAY NOT BE SUCCESSFUL
We recently launched our Internet business. To date, we have generated
limited revenues. Our current Internet business model, which is based on bar
associations encouraging members to use our websites, is unproven. Because of
our lack of experience and financial strength, we may not attract enough legal
professionals and others to our websites to make them attractive to advertisers
and product vendors.
Accordingly, our Internet business may not be successful.
IF WE ARE NOT SUCCESSFUL IN INCREASING BRAND AWARENESS AMONG MEMBERS OF THE
LEGAL COMMUNITY AND INCREASING VISITS TO OUR WEBSITES, OUR INTERNET BUSINESS
WILL NOT BE SUCCESSFUL
The future success of our Internet business will depend, in part, upon
our ability to
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increase our brand awareness. In order to build brand awareness and increase
usage of our websites, we must succeed in our marketing efforts and provide
high-quality services and continue to add content, products and services that
satisfy the needs of the legal community and others. Our ability to increase
advertising and produce revenues from our websites will depend in part on the
success of this marketing campaign. If our marketing efforts are unsuccessful
and we cannot increase our brand awareness, our Internet business will not be
successful.
IF THE INTERNET BECOMES AN UNRELIABLE MEANS FOR PROVIDING PRODUCTS AND SERVICES,
OUR ONLINE REVENUES WILL BE REDUCED
Because of Internet growth, the Internet infrastructure may not be able
to meet the demands placed upon it and reliability may decline. In addition, our
present and any future websites may experience interruptions in service as a
result of outages or other delays. Any of these factors could reduce the use of
our websites significantly, which would reduce our future online revenues. We
have not experienced any of these problems, except that Value America has failed
to provide reports and services to us as disclosed under "Recent Developments"
beginning at page 9 of this prospectus.
IF ADVERTISERS THAT ADVERTISE IN OUR PRINT DIRECTORIES DO NOT ACCEPT THE
INTERNET AS AN ADVERTISING MEDIUM, OUR ABILITY TO GENERATE REVENUES FROM THE
INTERNET MAY BE LIMITED
The success of our websites partly depends upon the willingness of
advertisers in our print directories to advertise online. Many of these
advertisers have little or no experience using the Internet for advertising
purposes. These businesses may find advertising on the Internet to be less
effective for promoting their products and services relative to traditional
advertising media. As a result, our future Internet revenues may be limited.
IF WE ARE NOT SUCCESSFUL IN COMPETING FOR INTERNET ADVERTISERS, OUR INTERNET
BUSINESS WILL NOT BE SUCCESSFUL
All of our Internet revenues have come from the sale of advertising. We
compete for a share of the advertising budget of those advertisers seeking to
reach the legal community, including websites operated by direct and indirect
competitors, traditional print media, and radio and television stations. If we
cannot assure advertisers that their advertising results in meaningful business
to them, we will not be successful in this aspect of our business.
IF THE THIRD PARTIES WE RELY UPON FOR E-COMMERCE TRANSACTIONS ARE UNABLE TO
GENERATE SIGNIFICANT SALES FROM E-COMMERCE TRANSACTIONS, THE ROYALTIES PAID TO
US WILL BE LIMITED
Because the goods and services we are offering and intend to offer
through others on the Internet are available elsewhere, both on the Internet and
through conventional retail outlets, we may not be successful in the e-commerce
market. Because we receive limited royalties or commissions from our e-commerce
programs, the third parties must achieve very high sales for us to recognize
meaningful revenues.
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NEW LAWS AND REGULATIONS RELATING TO THE INTERNET MAY REDUCE THE USAGE OF THE
INTERNET AND INCREASE OUR COSTS OF DOING BUSINESS ONLINE
There are an increasing number of laws and regulations pertaining to
the Internet, and additional laws and regulations may be enacted in the future.
These laws and regulations may relate to liability for information retrieved
from or transmitted over the Internet, online content, user privacy, taxation
and the quality of products and services. Moreover, the applicability to the
Internet of existing laws governing intellectual property ownership, copyright,
trademark, trade secret, obscenity, libel, gambling, employment, privacy and
other issues is uncertain and developing. Any new law or regulation relating to
the Internet or the application or interpretation of existing laws, could
decrease the demand for the Internet as a vehicle for information and commerce
and could increase the cost of our conducting business and otherwise impair our
ability to generate revenues or derive profits from the Internet.
OUR WEBSITES ARE VULNERABLE TO SECURITY BREACHES AND SIMILAR THREATS WHICH COULD
RESULT IN OUR LIABILITY FOR DAMAGES AND HARM TO OUR REPUTATION
Despite the implementation of network security measures by third
parties operating our websites, our websites are vulnerable to computer viruses,
break-ins and similar disruptive problems caused by Internet users. These
occurrences could result in our liability for damages, and our reputation could
suffer. The circumvention of our security measures may result in the
misappropriation of such proprietary information as credit card and social
security numbers. Any such security breach could lead to interruptions and
delays and the cessation of service to our customers and could result in a
decline in revenues.
RISK RELATING TO OUR COMMON STOCK
WE ARE CONTROLLED BY OUR CHIEF EXECUTIVE OFFICER, WHICH MEANS HE MAY STOP A
THIRD PARTY FROM ACQUIRING US EVEN IF IT IS IN THE BEST INTERESTS OF OUR
STOCKHOLDERS AND AS A RESULT HIS CONTROL MAY REDUCE THE PRICE OF OUR COMMON
STOCK
Mr. Peter S. Balise, president and chairman of our board of directors,
owns approximately 42% of our outstanding common stock. As a practical matter,
he will have sufficient voting power to control the outcome of matters submitted
to our stockholders for approval, including the election of directors and any
merger, consolidation or sale of substantially all of our assets. The
concentration of ownership of our common stock could delay or prevent a proxy
contest, merger, tender offer or purchases of our common stock that could give
our stockholders the opportunity to realize a premium over the then-prevailing
market price for our common stock.
This may have the effect of decreasing the market price of our common stock.
OUR COMMON STOCK PRICE MAY BE HIGHLY VOLATILE AND INVESTORS MAY NOT BE ABLE TO
SELL THEIR STOCK AT OR ABOVE CURRENT MARKET PRICES
At times this year, the market price of our common stock has been
highly volatile. At the same time, the stock market in general, and the market
for Internet-related technology companies in particular, has been highly
volatile. If, as a result of our new Internet business, we are
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perceived as an Internet company, our common stock price may become more
volatile in the future. Investors may not be able to resell their shares of our
common stock following periods of volatility because of the market's adverse
reaction to such volatility. We cannot assure you that our common stock will
trade at the same levels as other Internet stocks, or that Internet stocks in
general will sustain their current market prices.
Factors that could cause our common stock price to be volatile may
include:
o actual or anticipated variations in quarterly operating results,
o announcements of results concerning our new Internet business,
o new products or services,
o changes in financial estimates by securities analysts,
o changes in conditions or trends on the Internet industry,
o changes in the market valuations of Internet companies,
o changes in how the market perceives us and how it perceives the nature
of our business,
o announcements by us or competitors of significant acquisitions,
o strategic partnerships or joint ventures,
o additions or departures of key personnel, and
o sales of common stock.
Many of these factors are beyond our control. These factors may reduce
the market price of our common stock, regardless of our operating performance.
FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements that address
matters that include our expectations with regard to our print directory
business and our Internet business. In addition to these statements, trend
analysis and other information including words such as "seek", "anticipate",
"believe", "plan", "estimate", "expect", "intend" and other similar expressions
are forward-looking statements. These statements may be found in the section of
this prospectus entitled "Risk Factors". We anticipate that some or all of the
results will not occur because of various factors including, but not limited to
all of the risks discussed in "Risk Factors".
RECENT DEVELOPMENTS
We generate revenues primarily from the sale of advertising in
membership directories. Our traditional model for print directories was to
distribute them free to all members of bar or medical associations. Under our
free program, we are required to print directories for each association member;
this maximizes printing expenses. In the Spring of 1998, we implemented a new
method of distributing our membership directories to bar associations that we
call our directory participation program. Under our directory participation
program, we offer participating bar associations the opportunity to share
revenue with us from the sale of directories to members. This program results in
reducing circulation because not all members purchase the
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membership directories while at the same time reducing printing costs.
Ultimately, we anticipate advertising revenues may be less under this program.
However, due to a variety of factors affecting future advertising sales, it will
not be practicable to quantify the impact this program will have on future
advertising revenues. Presently, approximately half of the membership
directories we publish are for associations that have elected the directory
participation program.
At the beginning of 1999, all of our print directory operations began
to be conducted through our wholly-owned subsidiary, PCNA Communications
Corporation, which we organized in the fourth quarter of 1998. PCNA
Communications has been conducting operations of our online vendor directory
business that we launched on September 9, 1999. Both PCNA Communications and
Attorneys Online, Inc., another wholly-owned subsidiary which we organized in
the first quarter of 1999, have conducted the business of America's Legal
Superstore, our online e-commerce business which we launched on August 3, 1999.
Our president and chief executive officer is concentrating the great
majority of his time on expanding our new Internet business. He recently
spearheaded the negotiations through which Attorneys Online, Inc., purchased the
rights to the Internet address, attorneys.com. With this new website, we plan to
begin to evaluate different marketing strategies for Internet operations. To
date, we have spent only a limited amount of money in marketing and advertising
our new websites. Our primary marketing to date has consisted of seeking to work
with bar associations in order to encourage their members to visit our websites.
This program which we call our association alliance program involves our sharing
a portion of the revenues we will generate from e-commerce as a result of
purchases by a participating association's members. To date bar associations
that have joined our association alliance program include the state bars of
Massachusetts, Connecticut, Delaware, Virginia and Montana. Because of problems
we have encountered with Value America as described on page 11 of this
prospectus, we have not expanded our association alliance program to other state
bar associations in order to preserve our credibility.
However, we recognize that significant sums of money are currently
being spent by well-capitalized public and privately-held companies marketing
their websites. We do not have significant capital for marketing and advertising
our websites. Our association alliance program may not be successful in
competing with the better-funded companies marketing their e-commerce websites.
We are engaged in discussions with investment bankers relating to providing
financing to permit us to advertise and market our websites in order to gain
market share. We do not know if these negotiations will be fruitful and if we
will ultimately have sufficient capital for these purposes.
In connection with our acquisition of the Internet address
attorneys.com, we issued the sellers four-year non-interest bearing promissory
notes in the total amount of $100,000. We also issued to the sellers warrants to
purchase 100,000 shares of Attorneys Online, Inc. common stock exercisable for
four years at $2.25 per share. We recently agreed to cancel these warrants in
exchange for warrants to purchase 100,000 shares of our common stock at $2.25
per share exercisable over the same four-year period that the Attorneys Online
warrants were exercisable. In the event that we have more than 15,000,000 shares
of common stock outstanding, the warrants will be adjusted to permit the holders
to purchase more shares. The sellers have the
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option to either exercise the warrants or have the notes paid. If the notes are
pre-paid, the amount of the note payments will range from $25,000 if paid prior
to October 28, 2000 or $100,000 if paid after October 28, 2002. If on the due
date of the notes of October 28, 2003 the notes have not been paid, we may
extend the due date for an additional nine years in which case the notes
increase to $500,000, payable $50,000 per year.
We recently acquired the rights to another intangible asset in exchange
for the issuance of four year warrants to purchase our common stock at $2.188
per share. We purchased these rights to have the asset available for our use as
part of our future Internet strategy. We estimate that these warrants and the
warrants we issued to acquire the attorneys.com website will result in a future
non-cash operating expense of approximately $201,000 that we will amortize over
the next five years including approximately $3,000 for the fourth quarter of
1999.
During 1999, we created three new websites designed to serve members of
the legal community and others seeking legal information. We introduced the
first website, www.lawlinks.com, at the American Bar Association annual
convention on August 3, 1999. This website is designed to be a portal or an
entrance into the Internet. This website consists primarily of a variety of
legal information useful to lawyers as well as members of the general public.
Photobooks, Inc.compiles the information on this website from information
contained elsewhere on the Internet. This information may be viewed on
lawlinks.com or through links to the other websites. There are also direct links
to our other two websites as well as to the Martindale-Hubbell Lawyer Locator
and FindLaw, a leading Internet legal research service. There is also a link to
Emplawyernet.com, on online legal search firm containing listings of available
law jobs. In November 1999, we added a travel agency feature to lawlinks.com.
This feature is operated by Travelocity, a leading Internet provider of travel
services. For all airline tickets, cruises, hotels, rental cars and other travel
services purchased, we will receive a small royalty from Travelocity.
Additionally, lawlinks.com has a link to amazon.com, a leading online seller of
books and other merchandise.
We launched our second website located at www.lawmiles.com also on
August 3, 1999. This website features our online shopping mall that we call
America's Legal Superstore. It is actually operated by Value America, Inc.
Except for identifying our brandname and the links to our other websites, this
website is identical to Value America's website. As an affiliate program, we
receive a commission from Value America based upon Value America's sales through
our website. To date, the site has generated only nominal revenues. In late
December 1999, Value America announced it was laying off approximately one-half
of its employees and refocusing its business by eliminating unproductive product
lines. As a result of Value America's failure to provide reports, pay revenues
to us and set up the law miles accounts (redeemable for frequent flyer miles) as
required by our agreement with Value America, we have commenced an arbitration
proceeding against it. We also are seeking recovery for damage to our
reputation.
Our third website is www.thelegalsource.com, which is our online vendor
directory. We launched this website on September 9, 1999. This website is a
comprehensive online directory that features experts and product and service
providers to the legal community. It is searchable on either a statewide or
local area basis and by category. This website features pull-down menus which
permit the user to easily locate the type of expert, product or service desired.
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We generate revenues on this website from the sale of listings to
advertisers. We began selling online listings in May 1999 and recognized
$281,000 of revenues in the quarter ended September 30. Primarily because of the
shorter time available for selling online advertising, we estimate that fourth
quarter's Internet revenues from the sale of listings will be less than one-half
of the third quarter's Internet revenues. Also, during the fourth quarter we
began selling Internet listings for the online vendor directory as part of a
package consisting of advertising for our print membership directories and
online Internet listings; whereas through the third quarter we had sales staff
dedicated to selling Internet listings only.
In 2000, we intend to begin selling banner advertising for our websites
in order to generate additional revenues. However, as a practical matter, until
we can demonstrate that there is a substantial number of visitors to our
websites, we will not be successful in achieving significant revenues from
banner advertisements. As a result of our experience with Value America, we are
currently refocusing our Internet strategy. Furthermore, in 2000, we are
planning to launch a new website at www.attorneys.com. We are currently defining
the products and services that are to be featured on this new portal. We are
currently engaged in preliminary discussions with others concerning possible
acquisitions or strategic partnerships which would permit us to expand our
Internet business and provide additional services to the legal community and to
consumers seeking legal information. We cannot assure you that any of these
discussions will lead to agreements or that we will be able to expand our online
business.
On January 14, 2000, Mr. Richard C. Silver resigned from our board of
directors for personal reasons. At the same time, Mr. Russell A. Perkins
resigned from our board of directors due to a potential conflict because his
brother works for a competitor. At the same time, Mr. Matt Butler replaced Mr.
Silver on our board of directors, leaving one vacancy. Mr. Butler previously
served on our board of directors from June 1996 to August 1998. In conjunction
with his appointment to our board of directors, Mr. Butler purchased 115,000
shares of our common stock at the current market price of $2.188 per share,
investing a total of $251,620. Mr. Butler also received a grant of 4,000 vested
options exercisable at $2.188 per share. Additionally, Mr. Butler is providing
certain business consulting services for us for which we have issued him 10,000
options exercisable at $2.188 per share. These options will vest upon completion
of the services, which is expected to be around late April 2000.
12
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any document we file at the SEC's public reference rooms in Washington,
D.C., New York, New York and Chicago, Illinois. Please call the SEC at
1-800-SEC-0330 for further information on the public conference rooms. Our SEC
filings are also available on the SEC's Internet site at www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus. Later information we file with the SEC
will update and modify this information. We are incorporating by reference the
documents listed below and any future filings made with the SEC under the
Securities Exchange Act of 1934 until the warrant holder completes its offering
of 225,000 shares of common stock.
o Our annual report on Form 10-KSB for the year ended December 31, 1998,
as amended by Form 10-KSB/A filed December 14, 1999.
o Our quarterly reports on Form 10-QSB for the quarters ended March 31,
June 30 and September 30, 1999, as amended by Form 10-QSB/A filed
December 14, 1999.
o Our Proxy Statement for our annual meeting of stockholders held on
May 24, 1999.
o The description of our common stock contained in our registration
statement on Form 8-A, filed in 1996.
o All other reports filed under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
James M. Koller, CFO
The Publishing Company of North America, Inc.
186 PCNA Parkway
Lake Helen, FL 32744
(904) 228-1000
13
<PAGE>
SELLING STOCKHOLDER
The 225,000 shares of common stock are being offered for sale by
InterWest Associates. Ajay Anand, a partner of InterWest, is a beneficial owner
and has the power to sell the shares. InterWest Associates is currently
providing financial public relations services for us under an agreement entered
into on July 8, 1999. We are paying InterWest Associates a fee over the 12 month
period of the agreement at a rate of $6,000 for the first month, $5,000 for each
of the next two months and $3,000 per month for the remaining nine months. We
have had no other relationship with InterWest Associates in the past. InterWest
Associates has advised us that it does not own any of our securities except for
warrants we issued to it permitting it to purchase from us 225,000 shares of our
common stock. It intends to offer for sale all 225,000 shares of common stock.
The 225,000 shares of common stock may be purchased from us on the
terms and subject to the conditions contained in the table below:
<TABLE><CAPTION>
Lock-up on
No. of Warrants Exercise Price Sales Until Expiration Date
--------------------------------------------------------------------------------------------
<S> <C> <C> <C>
25,000 $1.6875 N/A January 7, 2001
25,000 $2.50 N/A February 7, 2001
25,000 $3.00 N/A March 7, 2001
16,667 $3.50 N/A April 7, 2001
16,667 $4.00 N/A May 7, 2001
16,667 $4.50 N/A June 7, 2001
16,667 $5.00 N/A July 7, 2001
16,667 $5.50 February 8, 2000 August 7, 2001
16,667 $6.00 March 8, 2000 September 7, 2001
16,667 $6.50 April 8, 2000 October 7, 2001
16,667 $7.00 May 8, 2000 November 7, 2001
16,664 $7.50 June 8, 2000 December 7, 2001
</TABLE>
The lock-up on sales means that even if the warrants are exercised, the shares
of common stock may not be sold until the applicable dates.
PLAN OF DISTRIBUTION
The shares covered by this prospectus may be offered and sold at any
time by the selling stockholder subject to the lock-ups described above. The
selling stockholder will act independently in making decisions with respect to
the timing, manner and size of each sale. The selling stockholder may sell the
shares being offered on the Nasdaq SmallCap Market, or otherwise, at prices and
under terms then prevailing or at prices related to the then current market
price, at varying prices or at negotiated prices.
Broker-dealers may receive compensation in the form of commissions,
discounts or concessions from the selling stockholders in amounts to be
negotiated in connection with sales.
14
<PAGE>
These brokers or dealers may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933. In this case, any commissions, discounts or
concessions received by broker-dealers and any profit on the resale of the
shares sold by them may be deemed to be underwriting compensation under the
Securities Act. Compensation to be received by any broker-dealers and retained
by the selling stockholders in excess of usual and customary commissions will,
to the extent required, be set forth in a supplement to this prospectus.
We have advised the selling stockholder that the anti-manipulation
rules of Regulation M under the Securities Exchange Act may apply to sales of
the shares of common stock offered in the market and to the activities of the
selling stockholder and its affiliates. In addition, we will make copies of this
prospectus available to the selling stockholder and have informed it of the need
for delivery of copies of this prospectus to purchasers at or prior to the time
of any sale of the shares of common stock. The selling stockholder may indemnify
any broker-dealer that participates in transactions involving the sale of the
shares against certain liabilities, including liabilities arising under the
Securities Act.
LEGAL MATTERS
Michael Harris, P.A., West Palm Beach, Florida, will pass upon the
validity of the shares of common stock being offered with this prospectus.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated financial
statements included in our Annual Report on Form 10-KSB/A for the year ended
December 31, 1998, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements are incorporated by reference in reliance on Ernst & Young
LLP's report, given on their authority as experts in accounting and auditing.
15
<PAGE>
================================================================================
225,000 SHARES
THE PUBLISHING COMPANY OF
NORTH AMERICA, INC.
COMMON STOCK
----------------
PROSPECTUS
----------------
_________________, 2000
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14 OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
- ------- -------------------------------------------
We will pay all expenses incident to the offering and sale to the
public of the shares being registered other than any commission and discounts of
underwriters, dealers or agents and any transfer taxes. Such expenses are set
forth in the following table. All of the amounts shown are estimates except for
the Securities and Exchange Commission registration fee.
SEC Registration Fee $ 675.39
Accounting Fees and expenses $ 8,000.00
Legal Fees and expenses $ 15,000.00
Miscellaneous $ 1,500.00
-----------
TOTAL: $ 25,175.39
ITEM 15 INDEMNIFICATION OF DIRECTORS AND OFFICERS
- ------- -----------------------------------------
Under Florida law, our directors are protected against personal
liability for monetary damages from breaches of their duty of care. As a result
our directors will not be liable in an action by us or a stockholder for
monetary damages alleging negligence or gross negligence in the performance of
their duties. However, our directors and executive officers remain liable for
monetary damages for willful misconduct, conscious disregard of the best
interest of The Publishing Company of North America, Inc. and for transactions
from which a director or officer derives an improper personal benefit. Directors
also remain liable under another provision of the Florida laws which makes
directors personally liable for unlawful distributions and expressly contains a
negligence standard with respect to this liability. The liability of our
directors and officers under federal or state securities laws is not affected by
these provisions of Florida law. We also maintain a liability insurance policy
to protect our directors and officers. While our directors have protection from
awards of monetary damages from breaches of fiduciary duty, that does not
eliminate the fiduciary duty equitable remedies including an injunction or
recession based upon a breach of fiduciary duty are still available.
Insofar as indemnification for liabilities arising out of the
Securities Act may be permitted to directors, officers, or persons controlling
us under the above provisions, we have been informed that in the opinion of the
Securities and Exchange Commission, this indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
II-1
<PAGE>
ITEM 16 EXHIBITS
- ------- --------
Exhibit No. Exhibits
- ----------- --------
4 Financial Public Relations Service Agreement (1)
4.1 Agreement to Purchase Attorneys.com (1)
4.2 Form of Warrants (Attorneys.com Purchase) (1)
4.3 Form of Note (Attorneys.com Purchase) (1)
4.4 Form of Warrants (for acquisition of intangible asset)
5 Opinion of Michael Harris, P.A. (1)
23 Consent of Ernst & Young LLP
23.1 Consent of Michael Harris, P.A. (1)(2)
(1) Contained in Form S-3/A No. 1 filed on December 14, 1999.
(2) Contained in Opinion of Michael Harris, P.A.
ITEM 17 UNDERTAKINGS
- ------- ------------
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
II-2
<PAGE>
Provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bonafide2 offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered, which remain
unsold at the termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the registrant's annual report
pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(5) 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 (see Item 15 above), 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.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Lake Helen, Florida on February 3, 2000.
THE PUBLISHING COMPANY OF
NORTH AMERICA, INC.
By: /s/ Peter S. Balise
-------------------------------------
Peter S. Balise
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement on Form S-3 has been signed by the following persons in
the capacities and on the dates indicated.
<TABLE><CAPTION>
Name Title Date
- ---- ----- ----
<S> <C> <C>
/s/ Peter S. Balise Chairman of the Board of Directors February 3, 2000
- ----------------------
Peter S. Balise
/s/ James M. Koller Chief Financial Officer February 3, 2000
- ---------------------- (Principal Financial and Accounting Officer)
James M. Koller
/s/ Matt Butler Director February 3, 2000
- ----------------------
Matt Butler
/s/ Andrew J. Cahill Director February 3, 2000
- ----------------------
Andrew J. Cahill
/s/ J. William Wrigley Director February 3, 2000
- ----------------------
J. William Wrigley
</TABLE>
II-4
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS
TO
AMENDMENT NO. 2
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
The Publishing Company of North America, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
EXHIBIT INDEX
Exhibit No. Exhibits
4 Financial Public Relations Service Agreement (1)
4.1 Agreement to Purchase Attorneys.com (1)
4.2 Form of Warrants (Attorneys.com Purchase) (1)
4.3 Form of Note (Attorneys.com Purchase) (1)
4.4 Form of Warrants (for acquisition of intangible asset)
5 Opinion of Michael Harris, P.A. (1)
23 Consent of Ernst & Young LLP
23.1 Consent of Michael Harris, P.A. (1) (2)
(1) Contained in Form S-3/A No. 1 filed on December 14, 1999.
(2) Contained in Opinion of Michael Harris, P.A.
II-5
EXHIBIT 4.4
-----------
THE SECURITIES REPRESENTED BY THIS CERTIFICATE AND
ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR UNDER THE PROVISIONS OF ANY
APPLICABLE STATE SECURITIES LAWS, BUT HAVE BEEN ACQUIRED
BY THE REGISTERED HOLDER HEREOF FOR PURPOSES OF INVESTMENT
AND IN RELIANCE ON STATUTORY EXEMPTIONS UNDER THE
SECURITIES ACT, AND UNDER ANY APPLICABLE STATE SECURITIES
LAW. THESE SECURITIES AND THE SECURITIES ISSUED UPON
EXERCISE HEREOF MAY NOT BE SOLD, PLEDGED, TRANSFERRED OR
ASSIGNED, NOR MAY THESE WARRANTS BE EXERCISED, EXCEPT IN
ACCORDANCE WITH TERMS SET FORTH IN THIS CERTIFICATE OR IN
A TRANSACTION WHICH IS EXEMPT UNDER PROVISIONS OF THE
SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT; AND IN
THE CASE OF AN EXEMPTION, ONLY IF THE COMPANY HAS RECEIVED
AN OPINION OF COUNSEL TO THE COMPANY THAT SUCH TRANSACTION
DOES NOT REQUIRE REGISTRATION OF ANY SUCH SECURITIES
No. ____
The Publishing Company of North America, Inc.
Common Stock Purchase Warrant
To Purchase 100,000 Shares of Common Stock
The Publishing Company of North America, Inc., a Florida corporation
(the "Company"), hereby certifies that, for value received,
______________________ or assigns (the "Holder") is entitled, subject to the
terms set forth below, to purchase from the Company at any time on or from time
to time for a period of four years commencing January 17, 2000 and expiring at
5:00 p.m. New York time on January 16, 2004, 100,000 fully paid and
non-assessable shares of unregistered common stock (the "Common Stock") of the
Company at the price of $2.188 per share (the "Purchase Price"). The number and
character of such shares of Common Stock and the Purchase Price are subject to
adjustment as provided herein.
As used herein the following capitalized terms, unless the context
otherwise requires, have the following respective meanings:
(a) The term "Company" includes any corporation which shall
succeed to or assume the obligations of the Company hereunder.
(b) The term "Common Stock" means the common stock, par value
$0.001 per share, of the Company, together with all stock of any class
or classes (however designated) of the Company, the holders of which
shall have the right, without limitation as to amount, either to all or
to a share of the balance of current dividends and liquidating
dividends after
Page 1 of 9
<PAGE>
the payment of dividends and distributions on any shares entitled to
preference, and the holders of which shall ordinarily, in the absence
of contingencies, be entitled to vote for the election of a majority of
directors of the Company (even though the right so to vote has been
suspended by the happening of such a contingency).
(c) The term "Fair Market Value" shall be determined as of the
close of the last trading day and shall mean:
(1) the closing price of the Company's Common Stock
appearing on a national securities exchange if the principal
market for the Common Stock is such an exchange, or, if not
listed or not the principal market, the closing price on The
Nasdaq Stock Market ("Nasdaq").
(2) if the Company's shares are not listed on Nasdaq,
then the closing price for its Common Stock as listed on the
National Association of Securities Dealers, Inc.'s
Over-the-Counter Bulletin Board (the "Bulletin Board"); or
(3) if the Company's Common Stock is not listed on
the Bulletin Board, then the average bid and asked price for
the Company's Common Stock as listed in the National Quotation
Bureau's "pink sheets"; or
(4) if there are no listed bid and asked prices
published in the pink sheets, then the fair market value shall
be based upon the average closing bid and asked price as
determined following a polling of all dealers making a market
in the Company's Common Stock.
(d) The term "Purchase Price per share" shall be the then
applicable purchase price for one share of Common Stock as adjusted
pursuant to Sections 5 and 6 hereof.
(e) The phrase "Trading Days" refers to days in which The
Nasdaq Stock Market is open for business.
(f) The term "Warrants" refers to these Warrants.
1. Exercise of Warrants; Partial Exercise.
1.1 Exercise in Full or in Part. These Warrants may be
exercised in full or in part by the Holder hereof by surrender of these
Warrants, with the form of subscription attached hereto duly executed by such
Holder, to the Company at its principal office, as provided in Section 17
hereof, accompanied by payment by certified or official bank check payable to
the order of the Company, in the amount obtained by multiplying the number of
shares of Common Stock called for on the face of these Warrants (without giving
effect to any adjustment therein) by the Purchase Price. In lieu of paying the
Purchase Price, as specified above, the Holder may surrender for cancellation
Warrants in an amount equal to the Fair Market Value of the Company's Common
Stock times the number of Warrants so as to equal the required aggregate
Purchase Price. By way of example, if the Holder elects to exercise 10,000
Warrants and the Fair Market Value of the Common Stock is $10.00, the Holder
must surrender 2,500 Warrants in order to pay $25,000.
Page 2 of 9
<PAGE>
Thus, the total number of Warrants remaining is 87,500 and the Holder owns
10,000 shares of Common Stock.
1.2 Company to Reaffirm Obligations. The Company will, at the
time of any exercise of these Warrants, upon the request of the Holder hereof,
acknowledge in writing its continuing obligation to afford to such Holder any
rights to which such Holder shall continue to be entitled after such exercise in
accordance with the provisions of these Warrants, provided that if the Holder of
these Warrants shall fail to make any such request, such failure shall not
affect the continuing obligation of the Company to afford such Holder any such
rights.
2. Delivery of Stock Certificates, etc., on Exercise. As soon as
practicable after the exercise of these Warrants in full or in part, and in any
event within two to three Trading Days thereafter, the Company at its expense
(including the payment by it of any applicable issue or transfer taxes) will
cause to be issued in the name of and delivered to the Holder hereof a
certificate or certificates for the number of fully paid and non-assessable
Common Stock to which such Holder shall be entitled upon such exercise, plus, in
lieu of any fractional share to which such holder would otherwise be entitled,
cash equal to such fraction multiplied by the then current fair market value of
one full share (determined by the closing price on the principal market as of
the date of receipt of the Warrants with executed subscription), together with
any other stock or other securities and property (including cash, where
applicable) to which such Holder is entitled upon such exercise pursuant to
Section 3 hereof or otherwise. The Holder, as partial consideration for the
issuance of these Warrants, agrees that it shall execute any agreement
restricting the right to sell the Common Stock issuable upon exercise if
requested by an underwriter of a public offering of the Company's securities and
the principal shareholders, officers and directors agree to a similar or longer
restriction on resale.
3. Anti-Dilution Provisions. If and to the extent that the number of
issued shares of Common Stock of the Company shall be increased, reduced or
changed by change in par value, split up, reclassification, or distribution of a
dividend payable in Common Stock, the number of shares subject to the Warrants
and the exercise price per share shall be proportionately adjusted.
4. Reorganization, Consolidation, Merger, etc. In case the Company
shall (a) effect a reorganization, (b) consolidate with or merge into any other
entity, or (c) transfer all or substantially all of its properties or assets to
any other entity under any plan or arrangement contemplating the dissolution of
the Company, then, in each such case, the holder of these Warrants, upon the
exercise thereof as provided in Section 1 hereof at any time after the
consummation of such reorganization, consolidation or merger or the effective
date of such dissolution, as the case may be, shall be entitled to receive (and
the Company shall be entitled to deliver), in lieu of the Common Stock issuable
upon such exercise prior to such consummation or such effective date, the stock
and other securities and property (including cash) to which such Holder would
have been entitled upon such consummation or in connection with such
dissolution, as the case may be, if such Holder had so exercised these Warrants
immediately prior thereto, all subject to further adjustment thereafter as
provided in Section 3 hereof.
Page 3 of 9
<PAGE>
5. Sale or Exercise Without Registration. If, at the time of any
exercise, the shares of Common Stock shall not be registered under the
Securities Act, the Company may require, as a condition of allowing such
exercise, that the Holder or transferee of such Common Stock, as the case may
be, furnish to the Company an opinion of counsel to the Company (for which the
Company shall pay the fees and expenses) to the effect that such exercise,
transfer or exchange may be made without registration under the Securities Act,
provided that the disposition thereof shall at all times be within the control
of such Holder or transferee, as the case may be. The Holder of the Warrants
represents to the Company that it is acquiring the Warrants for investment and
not with a view to the distribution thereof.
6. Further Assurances. The Company will take all such action as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and non-assessable Common Stock upon the exercise of all Warrants
from time to time outstanding.
7. Officer's Certificate as to Adjustments. In each case of any
adjustment or readjustment in the Common Stock issuable upon the exercise of the
Warrants, the Company at its expense will promptly compute such adjustment or
readjustment in accordance with the terms of the Warrants and prepare a
certificate, executed by its chief financial or accounting officer, setting
forth such adjustment or readjustment and showing in detail the facts upon which
such adjustment or readjustment is based, and the number of Common Stock
outstanding or deemed to be outstanding. The Company will forthwith mail a copy
of each such certificate to each Holder of Warrants.
8. Notices of Record Date, etc. In the event of
(a) any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the
Company or any transfer of all or substantially all the assets of the
Company to or consolidation or merger of the Company with or into any
other person; or
(b) any voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
and to which Section 4 hereof is applicable, then and in each such
event the Company will mail or cause to be mailed to each holder of
Warrants a notice specifying (i) the date on which any such record is
to be taken for the purpose of such dividend, distribution or right,
and stating the amount and character of such dividend, distribution or
right; and (ii) the date on which any such reorganization,
reclassification, recapitalization, transfer, consolidation, merger,
dissolution, liquidation or winding-up is to take place, and the time,
if any, as of which the holders of record of Common Stock shall be
entitled to exchange their shares of Common Stock for securities or
other property deliverable upon such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution,
liquidation or winding-up. Such notice shall be mailed at least 15 days
prior to the date therein specified.
9. Reservation of Common Stock, etc., Issuable on Exercise of Warrants.
The Company will at all times reserve and keep available, solely for issuance
and delivery upon the
Page 4 of 9
<PAGE>
exercise of the Warrants, all Common Stock from time to time issuable upon the
exercise of the Warrants.
10. Listing on Securities Exchanges; Registration. If the Company at
any time shall list any Common Stock on any national securities exchange, the
Company will, at its expense, simultaneously list on such exchange, upon
official notice of issuance upon exercise of the Warrants, and maintain such
listing of, all Common Stock from time to time issuable upon the exercise of the
Warrants.
11. Exchange of Warrants. Subject to the provisions of Section 5
hereof, upon surrender for exchange of any Warrants, properly endorsed to the
Company, the Company at its own expense will issue and deliver to the holder
thereof new Warrants of like tenor, in the name of such holder calling in the
aggregate on the face or faces thereof for the number of shares of Common Stock
called for on the face of the Warrants so surrendered.
12. Replacement of Warrants. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of any
Warrants and, in the case of any such loss, theft or destruction, upon delivery
of an indemnity agreement reasonably satisfactory in form and amount to the
Company or, in the case of any such mutilation, upon surrender and cancellation
of such Warrants, the Company at its expense will execute and deliver, in lieu
thereof, new Warrants of like tenor.
13. Legend. Upon exercise of any of the Warrants and the issuance of
any of the Common Stock, pursuant thereto all certificates representing Common
Stock shall bear on the face thereof substantially the following legend:
The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and
may not be sold, offered for sale, assigned, transferred or
otherwise disposed of, unless registered pursuant to the
provisions of that Act or unless a written opinion of counsel
to the Company concludes that such disposition is in
compliance with an available exemption from such registration.
14. Remedies. The Company stipulates that the remedies at law of the
Holder of these Warrants in the event of any default or threatened default by
the Company in the performance of or compliance with any of the terms of these
Warrants are not and will not be adequate, and that such terms may be
specifically enforced by a decree for the specific performance of any agreement
contained herein or by an injunction against a violation of any of the terms
hereof or otherwise.
15. Severability. In the event any parts of these Warrants are found to
be void, the remaining provisions of these Warrants shall nevertheless be
binding with the same effect as though the void parts were deleted.
16. Benefit. These Warrants shall be binding upon and inure to the
benefit of the parties hereto and their legal representatives, successors and
assigns.
Page 5 of 9
<PAGE>
17. Notices and Addresses. All notices, offers, acceptance and any
other acts under these Warrants (except delivery of these Warrants and payment
of the Purchase Price) shall be in writing, and shall be sufficiently given if
delivered to the addressees in person, by Federal Express or similar receipted
delivery, by facsimile delivery or, if mailed, postage prepaid, by certified
mail, return receipt requested, as follows:
The Company: Mr. Peter S. Balise, President
186 P.C.N.A. Parkway
Lake Helen, FL 32744-0280
Facsimile: (904) 228-0271
The Holder: __________________________
__________________________
__________________________
Facsimile:________________
or to such other address as any of them, by notice to the others may designate
from time to time. The transmission confirmation receipt from the sender's
facsimile machine shall be evidence of successful facsimile delivery. Time shall
be counted to, or from, as the case may be, the delivery in person or by
mailing.
18. Attorney's Fees. In the event that there is any controversy or
claim arising out of or relating to these Warrants, or to the interpretation,
breach or enforcement thereof, and any action or proceeding including an
arbitration proceeding is commenced to enforce the provisions of these Warrants,
the prevailing party shall be entitled to an award by the court of reasonable
attorney's fees, costs and expenses.
19. Governing Law. These Warrants and any dispute, disagreement, or
issue of construction or interpretation arising hereunder whether relating to
its execution, its validity, the obligations provided herein or performance
shall be governed or interpreted according to the internal laws of the State of
Florida without regard to choice of law considerations.
20. Section or Paragraph Headings. Section headings herein have been
inserted for reference only and shall not be deemed to limit or otherwise
affect, in any matter, or be deemed to interpret in whole or in part any of the
terms or provisions of these Warrants.
21. Arbitration. Any controversy, dispute or claim arising out of or
relating to this Warrant Agreement, or its interpretation, application,
implementation, breach or enforcement which the parties are unable to resolve by
mutual agreement, shall be settled by submission by either party of the
controversy, claim or dispute to binding arbitration in Volusia County, Florida
(unless the parties agree in writing to a different location), before a single
arbitrator in accordance with the rules of the American Arbitration Association
then in effect. In any such arbitration proceeding the parties agree to provide
all discovery deemed necessary by the arbitrator. The decision and award
Page 6 of 9
<PAGE>
made by the arbitrator shall be final, binding and conclusive on all parties
hereto for all purposes, and judgment may be entered thereon in any court having
jurisdiction thereof.
Dated: January 17, 2000 The Publishing Company of North America, Inc.
By:
--------------------------------
Peter S. Balise, President
Page 7 of 9
<PAGE>
ASSIGNMENT FORM
(To be executed only upon the assignment of Warrants)
FOR VALUE RECEIVED the undersigned registered holder of the within
Warrants hereby sells, assigns and transfers unto ______________, whose address
is ____________________________ all of the rights of the undersigned under the
within Warrants, with respect to ______________ Common Stock of The Publishing
Company of North America, Inc. and, if such Common Stock do not include all the
Common Stock issuable as provided in the Warrants, that new Warrants of like
tenor for the number of Common Stock not being transferred hereunder be issued
in the name of and delivered to the undersigned, and does hereby irrevocably
constitute and appoint ______________ Attorney to register such transfer on the
books of ______________ maintained for the purpose, with full power of
substitution in the premises.
Dated: ______________, ______. ____________________________________
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrants)
Signature Guaranteed ____________________________________
Address:
Page 8 of 9
<PAGE>
FORM OF SUBSCRIPTION
(To be signed only upon exercise of Warrants)
To:___________________________
The undersigned, the holder of the within Warrants, hereby irrevocably
elects to exercise the purchase right represented by such Warrants for, and to
purchase thereunder, ______________ Common Stock of The Publishing Company of
North America, Inc., and herewith makes payment of $______________ therefor, and
requests that the certificates for such shares be issued in the name of, and
delivered to, , whose address is . If the Common Stock being purchased hereby do
not include all the Common Stock issuable as provided in the Warrants, that new
Warrants for the number of Common Stock not being purchased hereunder be issued
in the name of and delivered to the undersigned.
Dated: ______________, ______. ____________________________________
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrants)
Signature Guaranteed ____________________________________
Address:
Page 9 of 9
EXHIBIT 23
----------
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form S-3 No. 333-86741) and related prospectus of
The Publishing Company of North America, Inc. for the registration of 225,000
shares of its common stock and to the incorporation by reference therein of our
report dated March 3, 1999, with respect to the consolidated financial
statements of The Publishing Company of North America, Inc. included in its
Annual Report (Form 10-KSB/A) for the year ended December 31, 1998, filed with
the Securities and Exchange Commission.
/s/ Ernst & Young LLP
----------------------------
Ernst & Young LLP
Orlando, Florida
February 4, 2000
