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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 19, 1997
REGISTRATION NO. 333-18291
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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POST-EFFECTIVE
AMENDMENT NO. 1
TO
Form SB-2
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
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COMPLETE WELLNESS CENTERS, INC.
(Name of small business issuer in its charter)
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DELAWARE 8099 52-1910135
(State or jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or Classification Code Number) Identification Number)
organization)
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725 INDEPENDENCE AVE., S.E., WASHINGTON, D.C. 20003 (202) 543-6800
(Address and telephone number of principal executive offices)
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E. EUGENE SHARER, PRESIDENT AND CHIEF OPERATING OFFICER
725 INDEPENDENCE AVE., S.E., WASHINGTON, D.C. 20003 (202) 543-6800
(Name, address and telephone number of agent for service)
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Copies to:
Anthony Cipiti, Jr., Esq.
Storch & Brenner LLP
1001 Connecticut Ave., N.W.
Washington, D.C. 20036-5504
202-452-0900
Lawrence B. Fisher, Esq.
Orrick, Herrington & Sutcliffe LLP
666 Fifth Avenue
New York, New York 10103-0001
212-506-5000
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Approximate date of proposed sale to the public: As soon as practicable
after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis, pursuant to Rule 415 under the Securities Act of
1933, 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 the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to Section 102 of the Delaware General Corporation Law (the
"DGCL"), the Registrant's Certificate of Incorporation contains the following
provision regarding limitation of liability of directors and officers:
A director of this corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for the breach of any
fiduciary duty as a director, except in the case of (a) any breach of the
director's duty of loyalty to the corporation or its stockholders, (b) acts
or omissions not in good faith or that involve intentional misconduct or a
knowing violation of law, (c) under section 174 of the General Corporation
Law of the State of Delaware or (d) for any transaction from which the
director derives an improper personal benefit. Any repeal or modification
of this Article by the stockholders of the corporation shall not adversely
affect any right or protection of a director of the corporation existing at
the time of such repeal or modification with respect to acts or omissions
occurring prior to such repeal or modification.
The Registrant is empowered by Section 145 of the DGCL, subject to the
procedures and limitation stated therein, to indemnify any person against
expenses (including attorney's fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with any
threatened, pending or completed action, suit or proceeding in which such person
is made a party by reason of his being or having been a director, officer,
employer or agent of the Registrant. The statute provides that indemnification
pursuant to its provisions is not exclusive of other rights of indemnification
to which a person may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors, or otherwise. The Registrant's
Certificate of Incorporation and the Registrant's By-laws both provide for
indemnification of its officers and directors to the full extent permitted by
the DGCL.
The Company intends to apply for directors' and officers' liability
insurance after the filing of this Registration Statement. Such insurance may
insure against any liability asserted against any present or past director or
officer incurred in the capacity of director or officer arising out of such
status, whether or not the Company would have the power to indemnify such
person.
Reference is made to Section 7 of the Underwriting Agreement filed as
Exhibit 1.1 to this Registration Statement with respect to certain
indemnification provisions for the benefit of the Registrant and its directors,
officers and controlling persons.
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth various expenses, other than the
underwriters' fees, discounts and commissions, which are anticipated to be
incurred in connection with the Offering. All amounts except the SEC
registration fee, the Nasdaq SCM filing fee, and the NASD filing fee are
estimates. None of the expenses will be paid for by selling security holders.
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SEC registration fee........................................................ $ 6,501.68
Nasdaq SCM filing fee....................................................... 8,194.10
NASD filing fee............................................................. 2,646.00
Blue Sky fees and expenses.................................................. 40,000.00
Transfer Agent's fees and expenses.......................................... 5,000.00
Printing and engraving expenses............................................. 80,000.00
Accounting fees and expenses................................................ 150,000.00
Legal fees and expenses..................................................... 200,000.00
Miscellaneous............................................................... 32,658.22
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Total.................................................................. $525,000.00
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ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES
Set forth below is certain information concerning sales by the Company of
unregistered securities within the past three years. Such information with
respect to the Company's Common Stock has been adjusted for (i) a 180-for-1
forward split of the Common Stock in November 1995, and (ii) a 1-for-3 reverse
split of the Common Stock in November 1996. Exemptions from registration for
other transactions are noted below. The consideration paid to the Company in
respect of each issuance of securities was cash, unless otherwise indicated.
(i) Effective November 1994, the Registrant issued a total of 378,000
shares of Common Stock to its four original stockholders (including C.
Thomas McMillen and James J. McMillen), each of whom was also a director
and/or officer of the Registrant at that time, for a price equal to
$.0001665 per share. Exemption from registration under the Act is claimed
pursuant to Section 4(2) thereof.
(ii) Effective January 1995, the Registrant issued a total of 16,500
shares of Common Stock to a newly elected member of its board of directors
(Robert J. Mrazek) for a price equal to $.0001665 per share. Exemption from
registration under the Act is claimed pursuant to Section 4(2) thereof.
(iii) Effective March 1995, the Registrant issued a total of 1,350
shares of its Series A, 12% Cumulative Convertible Preferred Stock, par
value $.01 per share, to seven individuals for a price of $100 per share,
each of whom had a pre-existing business and/or personal relationship with
one or more of the Registrant's officers, directors, or controlling persons
and was either an accredited investor within the meaning of Rule 501(a)
under the Act or a sophisticated investor who had the financial resources
to bear the loss of the investment and the means and opportunity to obtain
information concerning the Registrant. Exemption from registration under
the Act is claimed pursuant to Section 4(2) thereof.
(iv) Effective June 1995, the Registrant issued a total of 158,400
shares of Common Stock to a newly elected member of its board of directors
(Robert S. Libauer) for a price equal to $.0001665 per share. Exemption
from registration under the Act is claimed pursuant to Section 4(2)
thereof.
(v) Effective September 1995, the Registrant issued 6,000 shares of
Common Stock to Danielle S. Milano, now an officer of the Registrant, and
8,400 shares of Common Stock to one of the Registrant's outside attorneys
for a price equal to $.0001665 per share in both cases. Exemption from
registration under the Act is claimed pursuant to Section 4(2) thereof.
(vi) Effective November 1995, the Registrant issued $39,730 aggregate
principal amount of subordinated promissory notes and warrants to purchase
a total of 13,243 shares of Common Stock at an exercise price equal to
$.003 per share to four individuals, one of whom was a director of the
Registrant (Robert S. Libauer) and each of the others of whom had a
pre-existing business and/or personal relationship with one or more of the
Registrant's officers, directors, or controlling persons and was either an
accredited investor within the meaning of Rule 501(a) under the Act or a
sophisticated investor who had the financial resources to bear the loss of
the investment and the means and opportunity to obtain information
concerning the Registrant. Exemption from registration under the Act is
claimed pursuant to Section 4(2) thereof.
(vii) Effective April 1996, the Registrant issued 10,000 shares of
Common Stock to its President and Chief Operating Officer (E. Eugene
Sharer) upon his exercise of options to purchase such shares at an exercise
price of $.03 per share pursuant to the Registrant's 1994 Stock Option
Plan. Exemption from registration under the Act is claimed pursuant to Rule
701 under Section 3(b) thereof.
(viii) Effective April 1996, the Registrant issued 110,000 shares of
Common Stock to a party (Reach Laboratories, Inc.) that had performed
consulting and financial advisory services for the Registrant. The
Registrant's Board of Directors determined the value of such past services
to be no less than $3,300. The investor was an accredited investor within
the meaning of Rule 501(a) under the Act. Exemption from registration under
the Act is claimed pursuant to Section 4(2) thereof.
(ix) Effective May 1996, the Registrant issued 23,333 shares of Common
Stock to a consultant to the Registrant upon the consultant's exercise of
options to purchase such shares at an exercise price of
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$.03 per share pursuant to the Registrant's 1994 Stock Option Plan.
Exemption from registration under the Act is claimed pursuant to Rule 701
under Section 3(b) thereof.
(x) Effective June 1996, the Registrant issued 4,333 shares of Common
Stock to a consultant to the Registrant upon the consultant's exercise of
options to purchase such shares at an exercise price of $.03 per share
pursuant to the Registrant's 1994 Stock Option Plan and a settlement
agreement entered into between such parties in connection with litigation
involving alleged breaches of the consulting agreement between such
parties. Exemption from registration under the Act is claimed pursuant to
Rule 701 under Section 3(b) and/or Section 4(2) thereof.
(xi) Effective August 1996, the Registrant issued $1,100,000 aggregate
principal amount of secured promissory notes and warrants to purchase that
number of shares of Common Stock determined by dividing such amount by the
price per share of Common Stock in the offering subject to this
Registration Statement at an exercise price of $.003 per share to 11
investors, each of whom was an accredited investor within the meaning of
Rule 501(a) under the Act. The registrant also issued a warrant to purchase
3,333 shares of Common Stock at an exercise price of $.003 per share to
Roan Capital Partners, L.P., a broker-dealer, who acted as a placement
agent for a portion of the financing. Exemption from registration under the
Act is claimed pursuant to Section 4(2) thereof.
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ITEM 27. EXHIBITS
Not applicable.
ITEM 28. UNDERTAKINGS.
(a) The Registrant hereby undertakes to:
(1) File, during any period in which it offers or sells securities, 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
percent 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 information on the
plan of distribution.
(2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of securities at that time to be the initial bona
fide offering.
(3) File a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of the offering.
(b) The Registrant hereby undertakes to provide to the Representative, at
the closing specified in the Underwriting Agreement, certificates in such
denominations and registered in such names as required by the Representative to
permit prompt delivery to each purchaser.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "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 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 Act and will be governed by the final adjudication of
such issue.
(d) The Registrant hereby undertakes that it will:
(1) For determining any liability under the Act, treat the information
omitted from the form of prospectus filed as part of the Registration
Statement in reliance upon Rule 430A and contained in a form of prospectus
filed by the Registrant under Rule 424(b)(1) or (4) or 497(h) under the Act
as part of this Registration Statement as of the time the Commission
declared it effective.
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(2) For determining any liability under the Act, treat each
post-effective amendment that contains a form of prospectus as a new
registration statement for 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.
(e) The Registrant hereby undertakes that if the underwriter(s) in the
offering covered by this Registration Statement enter into transactions with any
of the selling securityholders named herein, or waive lock-ups applicable to
such selling securities holders, then:
(1) if such transaction or waiver of lock-up relates to not less than
five percent nor more than ten percent of the registered selling security
holders securities, the Registrant will file a "sticker" supplement
pursuant to Rule 424(c) under the Act relating thereto; and
(2) if such transaction or waiver of lock-up relates to more than ten
percent of the registered selling security holders securities, the
Registrant will file a post-effective amendment to the registration
statement relating thereto.
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SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2, and has authorized this
Post-Effective Amendment No. 1 to Registration Statement to be signed on its
behalf by the undersigned in Washington, D.C., on February 19, 1997.
COMPLETE WELLNESS CENTERS, INC.
/s/ E. EUGENE SHARER
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By: E. Eugene Sharer, President
In accordance with the requirements of the Securities Act of 1933, this
Post-Effective Amendment No. 1 to Registration Statement was signed by the
following persons in the capacities and on the dates stated.
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/s/ C. THOMAS MCMILLEN Chairman of the Board, Chief February 19, 1997
- ------------------------------------- Executive
C. Thomas McMillen Officer, and Director
(Principal Executive Officer)
/s/ E. EUGENE SHARER President, Chief Operating Officer, February 19, 1997
- ------------------------------------- Chief Financial Officer, Treasurer,
E. Eugene Sharer and Director
(Principal Financial and Accounting
Officer)
/s/ ROBERT S. LIBAUER* Director February 19, 1997
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Robert S. Libauer
/s/ JAMES T. MCMILLEN* Director February 19, 1997
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James T. McMillen
/s/ ROBERT J. MRAZEK* Director February 19, 1997
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Robert J. Mrazek
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*By: /s/ E. EUGENE SHARER
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E. Eugene Sharer
Attorney-in-fact
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