UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF
SECURITIES OF SMALL BUSINESS ISSUERS
Under Section 12 (b) or (g) of The Securities Exchange Act of 1934
Lifen, Inc.
(Name of Small Business Issuer in its charter)
Delaware 76-0585701
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
444 Madison Avenue, Suite 1710, New York, NY 10022
(Address of principal executive offices)
212-750-7878
Issuer's telephone number
Securities to be registered pursuant to Section 12(b) of the Act.
Title of Each Class Name of each exchange on which registered
NONE
Securities to be registered pursuant to Section 12(g) of the Act.
Common Stock, $.0001 par value.
(Title of Class)
FORM 10-SB
LIFEN, INC.
TABLE OF CONTENTS
FORWARD LOOKING STATEMENTS 3
PART 1
ITEM 1. Description of Business 3
ITEM 2. Plan of Operation 18
ITEM 3. Description of Property 20
ITEM 4. Security Ownership of Certain Beneficial Owners
and Management 20
ITEM 5. Directors, Executive Officers, Promoters, and
Control Persons 21
ITEM 6. Executive Compensation 24
ITEM 7. Certain Relationships and Related Transactions 24
ITEM 8. Description of Securities 25
PART II
ITEM 1. Market Price of and Dividends on the Registrant's
Common Equity and Related Stockholder Matters 25
ITEM 2. Legal Proceedings 26
ITEM 3. Changes in and Disagreements with Accountants 26
ITEM 4. Recent Sale Of Unregistered Securities 26
ITEM 5. Indemnification of Directors and Officers 27
PART F/S
Financial Statements F-1 to F9
PART III
ITEM 1. Index to Exhibits 28
ITEM 2. Description of Exhibits
Signatures 29
<PAGE>FORWARD LOOKING STATEMENTS
Some of the information contained in this Form 10-SB may constitute
forward- looking statements or statements within the meaning of the
Private Securities Litigation Reform Act of 1995. These forward looking
statements are based on current expectations and projections about future
events. The words "estimate", "plan", "intend", "expect", "anticipate"
and similar expressions are intended to identify forward-looking
statements which involve, and are subject to, known and unknown risks,
uncertainties and other factors which could cause the Company's actual
results, financial or operating performance, or achievements to differ
from future results, financial or operating performance, or achievements
expressed or implied by such forward-looking statements. Projections and
assumptions contained and expressed herein were reasonably based on
information available to the Company at the time so furnished and as of
the date of this filing. All such projections and assumptions are subject
to significant uncertainties and contingencies, many of which are beyond
the Company's control, and no assurance can be given that the projections
will be realized. Potential investors are cautioned not to place undue
reliance on any such forward-looking statements, which speak only as of
the date hereof. The Company undertakes no obligation to publicly release
any revisions to these forward looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
PART 1
ITEM 1. DESCRIPTION OF BUSINESS
(a) Business Development
The Company was incorporated under the laws of the state of Delaware on
November 10, 1997 under the name Digivision International, Ltd., and the
Company's name was changed to Lifen, Inc. (the "Company") on June, 22,
2000. The Company has not been involved in any bankruptcy, receivership
or similar proceedings. There has been no material reclassification,
merger, consolidation or purchase or sale of significant assets not in
the ordinary course of the Company's business. To date the Company has
had no commercial operations and has been engaged in the development of
its business plan, market research, initial web site development, and
seeking initial financing in order to commence commercial operations.
In June, 1998, the Company began discussions with the principals of
ThinkTanks Worldwide ("ThinkTanks") regarding their business venture.
ThinkTanks had developed a preliminary plan to create an Internet based,
content driven, multi-point Video Conferencing company, offering live,
interactive connectivity to communities of users worldwide. The Company
decided to become involved with ThinkTanks, and assisted with further
development of their business plan. After additional market research and
analysis, the Company determined that the ThinkTanks concept would
require substantially more time and capital than originally estimated to
develop and test market acceptance, raising the question of economic
feasibility, and subsequently ended its participation in the project. In
early 1999, the Company began development of a conceptual plan for a
health and wellness related business, which has been further defined and
expanded as discussed below.
<PAGE>(b) Business of Issuer
1. Background
The Company's preliminary business plan encompasses the general subject
areas of health, wellness, nutrition, fitness, and beauty, with a
particular focus on the overweight population and obesity. The Company's
objective is to establish a Wellness Center in Westchester County, New
York, in conjunction with medical doctors and surgeons located in
contiguous space, who specialize in treating overweight and obese
patients, as well as complementary healthcare professionals such as
nutritionists, physical therapists, chiropractors, and massage
therapists. The objective is to provide an atmosphere that would enable
members to follow the advice of their physicians under the supervision of
fitness professionals. Current plans for the Lifen Wellness Center
include providing fitness services; wellness programs emphasizing
preventive care; non-medical after-care for obesity surgery patients;
counseling regarding diet, nutrition, exercise, fitness, and beauty; and
also selling products such as nutritional supplements. In addition, the
Company is developing an Internet web site which will provide information
to the members of the Lifen Wellness Center and others who are interested
in learning about wellness, weight management, obesity and related
problems. The web site will provide a venue for inter-action for members
and others to benefit from the exchange of information, ideas and
experiences. In addition to providing health and wellness information on
a wide variety of topics on its web site, the Company intends to develop
e-commerce business, and provide the ability for users to develop chat
communities for health and wellness related interests.
Overview of Overweight Population and Obesity
While the country's population has become diet-focused, people are
getting fatter. From 1991 to 1998, the percentage of obese adults-
defined as those with a body mass of 30 or higher- increased from 12
percent to 18 percent, a 50 percent increase, according to The Center for
Disease Control. Obesity affects 70 million Americans, causing 300,000
deaths annually and costing $100 billion, according to the American
Obesity Association. Obesity is the second- leading cause of death after
smoking. Being obese or overweight increases the risk of hypertension,
heart disease, stroke, diabetes and some cancers. Government studies show
that over the past 20 years, Americans increased their food intake by 150
to 299 calories per day, without an overall increase in their physical
activity. About 45 percent of women and 25 percent of men are trying to
lose weight at any one time, but only one-fifth are using the recommended
combination of fewer calories and increased exercise, and thus most
dieters are unsuccessful. Americans spend more than $33 billion a year on
weight-loss products and services, which is about one- third of the
estimated costs of treating obesity.
According to "The Physician and Sportsmedicine", June, 1998, about twenty
percent of American children are overweight enough to be considered
obese. Also, childhood obesity tends to mature into adulthood obesity,
with about one third of obese children becoming obese adults. More than
one half of the children population is considered to be inactive, which
is a large factor in the obesity problem, and physical activity decreases
sharply during adolescence. Much of this decrease results from
surroundings that promote inactivity and the less participation in
physical education classes.
An overweight population results in increased diseases, disabilities and
absenteeism from business, with related economic impact upon society and
individuals. In a society that places emphasis on physical appearance,
being overweight leads to negative psychological consequences. There is
a great demand for services that will be helpful for overweight people to
become more fit and healthy, so that they may live a longer and more
productive lifestyle and enjoy a better quality of life.
In regard to obesity, various media sources have emphasized the problem,
and former Surgeon General C. Everett Koop has described obesity as the
next health care crisis in America.
II. Lifen Wellness Center
The planned purpose of the Lifen Wellness Center is to provide
professional services to improve the health, fitness, nutrition, and
physical appearance of its members, through an integrated approach
involving many potential therapies available. The Trends Research
Institute of Rhinebeck, New York has identified the integration of
traditional and complementary medicine as one of the top ten trends of
the decade.
As the business of the Wellness Center develops, the Company intends to
add more services with greater variety to meet the goal of attracting a
broad client base. The Wellness Center will remain unique because of its
planned strong relationship with medical professionals. The Company is
not authorized or qualified to engage in any activity which may be
construed or be deemed to constitute the practice of medicine and intends
to be an independent supplier of non-medical services only.
The Wellness Center intends to emphasize programs designed and monitored
by external professional health care personnel, including physicians (
some with special training in obesity and morbid obesity), nutritionists,
exercise physiologists, psychologists, acupuncture experts, and others.
The programs will include the education of patients or clients with
regard to the importance of weight control and the potential problems
which may result from being overweight, and the disease of obesity and
its complexity. In addition, easy access for obtaining wellness-
enhancing products will be provided.
The Wellness Center intends to attract the following types of members:
First tier:
A. Overweight or obese members, who are patients of medical
professionals.
B. Members with poor nutritional habits- will provide nutritional
counseling and exercise therapy.
C. Members with medical conditions related to obesity or fitness.
Second tier:
A. Members who desire improvement in fitness and exercise
physiology.
B. Members who have undergone weight loss and now desire or need
to maintain a stable weight with exercise programs.
Third tier:
A. Formerly overweight or obese members who desire to become more
fit.
B. Overweight or obese members who are successfully losing weight
and desire beauty or appearance enhancement.
The value of the Lifen Wellness Center will lie not only in treating
overweight people, the condition of obesity and its co-morbid conditions,
but will also offer a preventive means to treat a condition of epidemic
proportions. The Center's focus on the overweight population and obesity
may potentially help to develop business and economic relationships with
HMO's, health insurance companies, life insurance companies, and large
corporations.
The Lifen Wellness Center intends to focus not only on overweight
conditions and obesity, but also other health problems that can be
reduced by preventive measures, such as cardiac disease or
arteriosclerosis. The Center will have advantages over competitors, such
as traditional fitness centers and health clubs, because of its
relationship with the neighboring health care professionals, including
physicians, nurses, nurse practitioner, nutritionists, physical
therapists, etc. In the absence of well organized solutions to weight
management problems and obesity, the Company feels that a Wellness
Center with strong medical affiliations offering varied holistic and
traditional medical therapies will present an attractive choice.
Wellness Center Operations
The Wellness Center will be located, sized, designed, constructed and
managed in response to a thorough understanding of the local marketplace.
The Company intends to conduct an analysis that will include such factors
as an economic base study, business community profile, study of
competitive facilities, detailed financial analysis and other factors
necessary for a complete business analysis. Based on this information and
a market research survey, the Company will develop its final plans for
the Wellness Center. Currently, the Company plans to occupy a specially
designed building that will include its preventive care operations and a
separate neighboring medical care facility owned by a professional
medical corporation, which may be affiliated with the Company.
The planned Wellness Center will have a full complement of exercise
equipment, free weights, and a room for group classes for certain
activities. In the design of the Wellness Center, consideration will be
given to features such as parking; a day care facility for children; a
swimming pool; special modifications to accommodate overweight clients,
including modification to equipment (such as larger seats on exercise
bicycles), extra space between exercise machines, and an exercise room
floor designed so that it will be easier for these members to lie down
and stand up during exercise classes. Consideration will be given to
providing a separate fitness room for overweight members so that they
will have a non-threatening and more comfortable environment for their
exercise sessions. In addition to the operational considerations
involved, the final design of the Wellness Center will be highly
dependent on the Company's ability to raise the required capital.
The Company plans to recruit a staff of physical trainers who have
experience working with the types of people who fit the core profile of
the Wellness Center's targeted market, those who have problems such as
overweight conditions, obesity, heart disease, diabetes, etc. The
emphasis will be on providing individual attention to members. In
addition, the staff will include beauty professionals who will provide
advice, instruction and information regarding beauty, make-up, physical
appearance, etc.
The Company intends to enter into a services agreement with professional
medical and other health care providers who will occupy contiguous space
in the Wellness Center's building. The Company plans to lease space to
the professional medical corporation and provide comprehensive business
services on a contractual basis.
The beginning phase of the business will include activities such as fund
raising; finding a suitable location; interior design and construction;
establishing relationships with medical professionals, beauty experts,
fitness equipment vendors; recruiting a staff; development of a marketing
program for individual and corporate clients; and launching its web site.
The Company plans to open additional Wellness Center facilities in
strategic locations, after the initial Wellness Center achieves
satisfactory results and performance. The operating systems and
procedures will be designed with the objective of establishing standard
systems for future multiple locations. The Company will have to raise
additional capital in order to open additional locations, and no
assurance can be given that additional capital can be raised.
The Wellness Industry
The Wellness industry is fragmented and encompasses a broad range of
businesses that are focused on areas such as health, fitness, nutrition,
and beauty. The industry includes medical practitioners and facilities,
wellness centers, health and fitness clubs, spas, manufacturers of
traditional and alternative medical, nutritional and beauty related
products.
III. Lifen, Inc.'s Web Site
Lifen, Inc.'s web site is being designed to provide consumers with a
variety of healthcare content, including information on acute ailments,
chronic illnesses, nutrition, fitness, and wellness, and access to
medical databases, publications, and real-time medical news. In addition,
the Company intends to offer various interactive communities consisting
of chat support groups. The support groups will enable users to share
experiences with others who face, or have faced, similar health
conditions, making the entire group's experience available to each
member.
The Lifen web site is currently under development, but may be viewed at
www.lifen.com. To visit the web site, enter "lifenc" as the User Name and
enter "wellness" as the Password.
The Company intends to develop relationships with affiliates, who will
provide their users easy access to the information and services offered
on the Company's website. These relationships will provide the
opportunity for broad exposure of the Company's brand, direct traffic to
the Company's website, and acquire and distribute related local content.
The Company intends to expand its network by continually establishing
relationships with affiliates that have the ability to direct users to
its network.
The Company feels that health-concerned consumers are highly motivated in
their need to find accurate information for use in their lives. The
Company intends to develop a respected brand that consumers will rely on
for such information and for related e-commerce opportunities. The
Company's planned business model consists includes earning advertising,
subscription and e-commerce transaction revenues from advertisers,
merchants, manufacturers, and healthcare organizations who desire to
reach a highly targeted community of healthcare consumers on the
Internet. Advertisers will be able to target very specific markets, such
as those people interested in a particular disease or in focusing on a
particular health condition.
Internet Industry Background
The Internet has become an interactive mass communications and commerce
medium enabling millions of people worldwide to share information, create
communities of those with similar interests, and conduct business
electronically. According to an industry research firm, the number of
worldwide Internet users is projected to increase from approximately 100
million in 1998 to approximately 320 million in 2002. The Internet has
features and functions that are unavailable in traditional media,
offering real-time access to dynamic and interactive content and
instantaneous communication among users. These features, together with
the rapid growth of the Internet, have resulted in a powerful and fast
expanding direct marketing and sales medium. In addition to the
advantages provided to advertisers, on-line merchants have the ability to
reach a vast audience and operate with lower costs and greater economies
of scale, while offering consumers larger selections, lower prices, and
greater convenience than conventional retailing.
Several portals have established themselves as leading pathways for a
broad variety of information. Internet users are supplementing these
portals with subject specific vertical portals. These vertical portals
use brand awareness driven by high quality topical content and
significant market resources to establish themselves as destinations for
highly concentrated groups of users.
On-line communities have developed that allow users with similar
interests to engage in interactive activities. Current technology
provides users flexibility in creating and personalizing content. The on-
line communities are valuable to users interested in healthcare topics,
particularly since medical information may be complex.
Healthcare is the largest segment of the United States economy,
representing an annual expenditure of approximately one trillion dollars.
Health and medical information is one of the fastest growing areas on the
Internet. According to Cyber Dialogue, an industry research firm, during
the 12 month period ended July, 1998, approximately 17 million adults in
the United States searched on-line for health related information, and
approximately 50 percent of them made off-line purchases after using the
Internet. Cyber Dialogue estimates that the number of adults in the
United States using the Internet for health related information will
increase to approximately 30 million in the year 2000, and that they will
spend approximately $150 billion for all types of health related products
and services off-line. Therefore, companies that establish a strong brand
identity as a reliable source of on-line healthcare information and
services will have a significant opportunity for multiple sources of e-
commerce revenue.
Internet Business Strategy
The Company's planned Internet business strategy includes the following
key elements:
Establish the Company's Brand. The Company intends to allocate
sufficient resources to develop and build brand recognition through on-
line advertising, general advertising, strategic alliances, and other
marketing activities. A marketing campaign will be planned to create
awareness of the Lifen, Inc. brand among consumers, healthcare
organizations, businesses, Internet portals, and other websites. The
Company intends to enhance its brand through the experience and contacts
of its health and fitness principals, and through association with other
professionals in the healthcare field.
Provide High Quality Healthcare Content. Lifen, Inc. intends to provide
consumers with high quality healthcare content, including information on
wellness, acute ailments, chronic illnesses, nutrition, and fitness, and
access to medical databases, publications, and real-time medical news.
This information will be obtained from established authoritative sources
in the field. The Company plans to integrate the latest healthcare
information on a wide variety of topics with interactive communities and
tools, and opportunities to purchase healthcare and related products and
services on-line. Providing such high quality healthcare information will
be a competitive advantage that should help to attract users to the
Company's website, increase page views per visit, and promote consumer
loyalty.
Provide an Attractive Advertising Website. The Company intends to target
specific users, which, with the interactive nature of the website being
developed, should be of appeal to healthcare, pharmaceutical, fitness,
nutrition, and other companies that advertise on the Internet. By
identifying users interested in certain health related subjects, or
special health conditions, Lifen, Inc. feels that it should be able to
deliver advertising in a highly selective manner, resulting in higher
advertising rates.
The Lifen, Inc. Network. The Company plans to develop a consumer and
business-to-business focused interactive website which will provide
comprehensive healthcare information and services, as well as affiliate
relationships with portals, other websites, healthcare organizations and
traditional media outlets. The planned website will integrate dynamic
healthcare information on a wide variety of subjects, interactive
communities and tools that enable users to personalize their experience
and opportunities to purchase healthcare related products and services
on-line. The successful development of affiliate relationships should
provide broad exposure of the Lifen, Inc. brand, steer large volumes of
traffic to the Company's site, and acquire and distribute relevant
content at the local level. Logos and credits will be displayed on every
web page displayed in order to help build brand awareness and attract
users to the Company's website.
Provide E-Commerce Offerings. The Company intends to include e-commerce
transactions offered by third parties in its network. Merchants,
manufacturers, and service providers will have access to selectively
targeted health conscious consumers through the Lifen, Inc. website and
links will be provided to the Company's portal affiliates. The Company
intends to offer provider arrangements to various third parties and
obtain a transaction fee for sales referred by the Lifen, Inc. website,
or an anchor tenant rental fee. The anchor tenant rental fees will be
paid by on-line merchants in exchange for a prominent link to their on-
line stores. The Company feels that e-commerce merchandising will attract
users to its website and help to promote user loyalty.
Develop On-Line Wellness Communities. The Company intends to offer
registered users free access to various wellness communities of hosted
chat support groups. The communities will be organized by health topics,
such as weight management, obesity, diet, nutrition, fitness, and
selected chronic illnesses. The chat support groups will enable users
with similar health related experiences to exchange information in a
secure and anonymous on-line environment. These groups will be hosted by
moderators experienced in the particular subject area being discussed.
The Company feels that these communities and support groups will attract
users to the Lifen, Inc. Network and foster loyalty. Also, by gathering
users interested in a particular topic, the Company feels that it will be
able to sell advertising in very selective manner, resulting in higher
advertising revenue. In addition, e-commerce merchants will be offered
the opportunity to market their products and services to a targeted base.
Lifen, Inc. Website. The Company intends to provide consumer focused
information for the health-conscious public, those with health
conditions, and those who have recovered from illness or injury, with an
emphasis on ease of understanding. This information will include such
topics as acute ailments, weight management, obesity, chronic illnesses,
nutrition, fitness, wellness, and access to medical databases,
publications, and real-time medical news.
IV. The Company's Services and Products
The Company's planned services and products presently include the
following:
Management Services Provided to Medical Professional Corporation- a
monthly management fee will be billed to the Medical Professional
Corporation in the contiguous space for office rent, administrative and
financial services, real estate management, marketing, development of
business strategies and other business consulting.
Wellness Center Memberships- individual memberships will be sold, which
will include an initiation fee. Arrangements will be made to
automatically bill monthly charges for members to their credit card, thus
greatly minimizing billing and collection effort and also providing
efficient cash flow.
Wellness Center Services and Products- the Company intends to sell
services and products in its Wellness Center, such as personal training
sessions, massages, nutritional supplements, basic refreshments, and
fitness apparel.
Sale of Wellness Services to Corporate Clients- customized wellness
services will be marketed to corporations, and may be performed at the
client's location or at the Company's Wellness Center. In addition,
corporate memberships for the Company's Wellness Center will be offered
at a special rate. The benefits of corporate wellness programs include
healthier employees, reduced absenteeism, increased productivity and
morale, and potentially reduced health care costs.
e-Commerce- the Company will offer health related products and services
on its web site as an affiliate of various third party companies, earning
transaction fees on such sales. Also, Lifen, Inc. plans to expand its web
site to link interested commercial participants in the health and
wellness industry in an efficient business to business exchange where
users can purchase health, fitness, nutrition and beauty products and
services. The Company is not planning to maintain inventory or perform
order fulfillment services.
Web SiteAdvertising- the Company plans to offer advertising space on its
web site to companies that may be interested in the Wellness marketplace
and the demographic representation of the Company's user base.
Web Site Content and On-Line Communities- Lifen, Inc. plans to offer
healthcare content on a variety of topics and provide access to
interactive communities consisting of chat support groups.
Lifen, Inc.'s Marketing Strategy
In order to achieve its business objectives and penetrate its target
markets, the Company's marketing strategy will consist of utilizing
various tools and resources including the following:
Market Research- The Company plans to develop and conduct a market
research survey in the targeted geographical area of Westchester County,
New York to determine specific health and wellness needs and interests,
as well as demographic characteristics of the local population. Market
research will also be conducted with local corporations in order to get
their feedback. The results of the market research will be reviewed and
evaluated for use in the final choice of a location, the design of the
Wellness Center and equipment complement, and also for providing
information for web site content.
Corporate Identity and Marketing Material- The Company intends to develop
a corporate identity and awareness campaign, including marketing material
such as graphics, brochures, multimedia, and vertical market
presentations. Where possible, marketing material will be made available
on the Company's web site in order to provide quick delivery, as well as
minimizing printing and mailing costs.
Advertising- Lifen, Inc. intends to develop an advertising program
utilizing the services of an advertising agency with experience in the
health care and Internet industries. The program would include such
activities as advertising in consumer, trade, and industry publications
related to the Company's target markets. The main thrust of the
advertising would be to establish the identity of Lifen, Inc. and the
Wellness Center, the branding of its services, and to emphasize the
benefits of those services to prospective clients. The agency would also
be involved in the design and development of the Company's web site.
Corporate Public Relations- Lifen, Inc. plans to retain a public
relations firm to develop a public relations campaign, working with
Company principals and the advertising agency. The objective of the
corporate public relations campaign will be to develop market visibility
and to help establish and position the Company in its niche in the health
care marketplace. The firm will also be involved with other activities,
such as planning speeches, advance work for conferences and trade shows,
assistance with the creation of marketing materials, and special
announcements.
Sales and Marketing Staff- The Company intends to employ sales and
marketing personnel as needed to obtain business for its Wellness Center.
The Company believes that its principals and planned initial staff will
be able to handle the preliminary development of the business. As
activity increases and a broader presence is established, it will be
necessary to support the operations and sales efforts with new and
creative marketing programs and additional staffing.
Pre-Opening Marketing Program- Lifen, Inc. intends to develop a pre-
opening marketing program in order to make individuals and corporations
in the local community aware of the planned Wellness Center, and to offer
the sale of memberships in advance of the grand opening. Consideration
will be given to special discounted initiation fees for advance
memberships.
Grand Opening Program- The Company intends to develop a grand opening
program to publicize the official opening of the Wellness Center. This
program would include such activities as special advertising and
promotions; invitations to the local private, business and medical
community for facility tours; and a grand opening celebration event.
Web Site- The Company intends to design its Internet web site with the
objective of providing one of the initial pro-active sales and marketing
activities. The web site design will emphasize functionality and ease of
use.
Strategic Relationships- the Company intends to enter into strategic
relationships with on-line, media distribution, and healthcare companies.
The objective of such relationships is to enhance the Company's brand,
increase the number of e-Commerce transactions, generate traffic on the
Lifen web site and capitalize on potential additional revenue
opportunities.
Health Fairs- Lifen, Inc. intends to provide health fairs for the
corporate wellness marketplace, tailored for the needs and interests of
corporate clients.
Direct Mail- The Company intends to utilize direct mail marketing
campaigns, utilizing specialized mailing lists for the target markets.
Conferences and Trade Shows- Lifen, Inc intends to participate in
selected national and regional industry conferences and trade shows based
on market research. In addition, Lifen, Inc. intends to sponsor its own
events in key markets. This marketing activity will be an opportunity to
create a professional image and increase Company awareness.
Competition
In regard to the Internet portion of the Company's planned business, a
large number of companies compete for users, advertisers, e-commerce
transactions, and other sources of on-line revenue. The number of
Internet web sites offering healthcare content, products and services is
very large and increasing at a fast rate. In addition, traditional media
and healthcare companies compete for consumers both through traditional
methods as well as through new Internet initiatives. The competition for
healthcare consumers will continue to increase as the Internet grows as
a commercial medium.
The Company will be competing directly for users, advertisers, e-Commerce
merchants, and affiliates with numerous Internet and non-Internet
businesses. The Company believes that competition in the Internet
marketplace will be based primarily on the quality and market acceptance
of healthcare content, brand recognition, and the quality and market
acceptance of new enhancements, features and tools. The Company's
competitors have substantial competitive advantages, including: the
ability to offer a wider array of on-line products and services; larger
operations and technical staffs; greater name recognition and larger
marketing budgets and resources; larger customer and user bases; and
substantially greater financial, technical, and other resources.
In order to be competitive, the Company must respond quickly and
effectively to technological change, new standards, and innovations by
competitors by continually enhancing its products and services, as well
as its sales and marketing channels.
The Company's planned Wellness Center will compete with other health
resource businesses that have a wellness focused environment and provide
consumers with access to traditional and alternative health information.
Most of these competitors will have significantly greater financial and
other resources, larger facilities, multiple locations, provide a wider
array of services, more experience providing services, and have longer
established relationships with buyers of such services than the Company.
Government Regulation
Various federal, state and local laws regulate companies in the health
care industry. The Company does not plan to offer healthcare services
which are subject to such laws.
The following is a summary of some of the healthcare regulatory issues,
which the Company does not believe will affect its operations:
Federal Law
Anti-kickback statute- The U.S. Federal anti-kickback statute prohibits
the knowing and willfull solicitation, receipt, offer, or payment of any
direct or indirect remuneration in return for the referral of patients or
the ordering or purchasing of items or services payable under Medicare,
Medicaid or other federal health care programs.
Self-referral law- Subject to certain limited exceptions, the Federal
self-referral law, known as the "Stark Law", or "Stark II Law", prohibits
physicians from referring their Medicare or Medicaid patients for the
provision of "designated health services" to any entity with which they
or their immediate family members have a financial relationship.
State Law
Anti-kickback laws- In addition to the Federal anti-kickback law, a
number of states have enacted laws which prohibit the payment for
referrals and other types of anti-kickback arrangements. Such state laws
typically apply to all patients regardless of their source of payment.
Self-referral laws- In addition to the Federal Stark Law, a number of
states have enacted laws that require disclosure of or prohibit referrals
by health care providers to entities in which the providers have an
investment interest or compensation relationship. In some states, those
restrictions apply regardless of the patient's source of payment.
Corporate practice of medicine laws- The laws of many states prohibit
business corporations from engaging in the practice of medicine through
employment arrangements with physicians.
Fee-splitting laws- The laws of some states prohibit providers from
dividing with anyone, other than providers who are part of the same group
practice, any fee, commission, rebate, or other form of compensation for
any services not actually and personally rendered.
Licensing laws- Every state imposes licensing requirements on individual
physicians and on certain other types of healthcare providers and
facilities. Many states require regulatory approval, including licenses
to render care or certificates of need, before establishing certain types
of health care facilities or offering services which entail the
acquisition of expensive medical equipment. While the performance of
management services on behalf of a medical practice does not currently
require any regulatory approval, there can be no assurance that such
activities will not be subject to licensure in the future.
RISK FACTORS
Lack of Operating History and Earnings. The Company was formed in
November, 1997, and has no operating history or revenues. Most recently,
the Company has been engaged in the development of a new business plan
and the search for funding in order to commence commercial operations.
Therefore, the Company must be considered to be a "start-up" operation
and subject to all the risks inherent in a new business venture, many of
which are beyond the control of the Company, including the inability to
implement successful operations, lack of capital to finance acquisitions
and failure to achieve market acceptance.
Reliance Upon Management. Presently, the Company is totally dependent
upon the personal efforts of its current management. The loss of any
officer or director of the Company could have a material adverse effect
upon the business and future prospects of the Company. The Company does
not presently have key-man life insurance upon the life of any of its
officers or directors. Further, all decisions with respect to management
of Company affairs will be made exclusively by current management. The
Company will also employ independent consultants to provide business and
marketing advice. Such consultants have no fiduciary duty and may not
perform as expected. The success of the Company will in significant part
depend upon the efforts and abilities of management, including such
consultants as may be engaged in the future. Additionally, as the Company
implements its planned expansion of commercial operations it will require
the services of additional skilled personnel. There can be no assurance
that the Company can attract persons with the requisite skills and
training to meet their future needs or, even if such persons are
available, that they can be hired on terms favorable to the Company. See
"MANAGEMENT."
Company Growth is Dependent on the Successful Implementation of the
Company's Business Plan. It is currently anticipated that the Company's
future growth will result from the development of its planned Wellness
Center, the successful implementation of its Internet web site,
development of brand awareness, the ability to attract viewers, and
customers to its web site, the ability to develop strategic
relationships, effectively responding to competition, future development
and upgrading of its technology, the ability to attract and retain
qualified personnel and the ability to obtain necessary financing on
acceptable terms. Additionally, as the Company implements its business
plan, there can be no assurance that there will not be substantial
unanticipated costs and expenses associated with the start-up and
implementation of such plan.
The Company's Financial Statements Contain a "Going Concern
Qualification". The Company may not be able to operate as a going
concern. The independent auditors' report accompanying the Company's
financial statements contains an explanation that the Company's
financial statements have been prepared assuming that the Company will
continue as a going concern. Note 5 to these financial statements
indicates that the Company is in the development stage and needs
additional funds to implement its plan of operations. This condition
raises substantial doubt about its ability to continue as a going
concern. The financial statements do not include any adjustments that
might result from the outcome of this uncertainty. The Company's audit
report and financial statements are included herein as "PART F/S".
Ability to Fund Business Strategy. The Company's business strategy will
require that substantial capital investment and adequate financing be
available to the Company. Capital is needed not only for expansion, but
also for the development of operations and additional equipment and
technology. Should the Company be unable to complete or obtain
anticipated financing needs, the Company may be required to obtain
financing through other borrowings or the issuance of additional equity
or debt securities, which could have an adverse effect on the value of
the existing Common Stock.
Unproven Acceptance of the Company's Management and Marketing Plan - No
Formal Market Surveys. Currently the Company plans to open a Wellness
Center and implement an Internet based health and wellness web site.
Although some companies have been very successful over the past several
years, no formal market studies have been undertaken by the Company as of
the date of this report. The Company intends to conduct a marketing
survey in the future, subject to the availability of funds. In view of
the fact that the Company itself has had no sales experience with
services of this type, there can be no assurance that its planned
services will achieve market acceptance (or sufficient market acceptance
to make the Company's operations commercially viable) among its target
market. The failure of the Company's services to achieve market
acceptance (or sufficient market acceptance to make the Company's
operations profitable), would have a material adverse effect on the
Company's business and financial condition and could result in the
failure of the Company to achieve, or sustain, viable commercial
operations of any kind in the future.
Uncertainty As To Management's Ability To Control Costs And Expenses.
With respect to the planned business operations of the Company,
management cannot accurately project or give any assurance, with respect
to its ability to control development and operating costs and/or expenses
in the future. Consequently, even if the Company is successful in
implementing its planned commercial operations (of which there can be no
assurance), if management is not able to adequately control costs and
expenses, such operations may not generate any profit or may result in
operating losses.
Possible Adverse Effect of Federal and State Laws That Prohibit the
Corporate Practice of Medicine. While the Company believes that its
planned operations will be in material compliance with existing
applicable laws, the Company's structure could be challenged as
constituting the unlicenced practice of medicine and the enforceability
of the legal agreements underlying the Company's structure could be
limited. The inability to successfully restructure such contractual
arrangements could have a material adverse effect on the Company.
Possible Adverse Effect of Government Regulations and Future Regulatory
ChangesRegarding the Internet. Although the Company's planned operations
are not subject to any regulations governing the Internet, services which
are provided via the Internet or the companies which provide such
services, it is likely that, in the future, such regulations will be put
in place. Although it is not possible to predict the extent of any such
future regulations, and although management is not aware of any pending
regulations which would be applicable to its planned business operations,
it is possible that future or unforeseen changes may have an adverse
impact upon the Company's ability to continue or expand its operations as
presently planned. The extent of such regulations is impossible to
predict, as is the potential impact upon the business operations of the
Company in accordance with its business plan.
No Dividends. The Company has not paid any dividends nor, by reason of
its present financial status and contemplated financial requirements,
does it anticipate paying any dividends in the foreseeable future. See
"DESCRIPTION OF SECURITIES."
The Internet Industry is Highly Competitive and Changing Rapidly, and the
Company May Not Have the Resources to Compete Adequately. The number of
Internet web sites offering health content, products and services is vast
and increasing at a rapid rate. Lifen, Inc. will be competing with such
other companies for users, advertisers, e-commerce and other sources of
on-line revenue. In addition, traditional media and healthcare providers
compete for business through traditional means as well as through new
Internet initiatives. The Company believes that competition for health
concerned consumers will continue to increase with the continuing
development of the Internet. The Company will be competing with numerous
Internet and non-Internet businesses for users, consumers, advertisers,
e-commerce merchants, and affiliates. Many of these potential competitors
have substantial competitive advantages over the Company, including the
ability to offer a wider array of on-line products and services; larger
operations, technical and marketing staffs and resources; greater name
recognition; and larger customer and user bases.
Developing Market; New Entrants. The Company's future growth is
dependent to a significant extent upon its ability to attract clients to
its Wellness Center, derive revenue from sales of Internet based
products and services primarily for health and wellness. The Internet
market for these products and services is rapidly evolving, highly
competitive, and is characterized by an increasing number of new market
entrants. Demand and market acceptance for the Wellness Center and such
products and services are subject to a high level of uncertainty, and
there can be no assurance that their commercial acceptance will continue
to grow.
Competition; Low Barriers to Entry. There is a very high level of
competition among companies offering similar products and services on the
Internet. The Company expects that new competitors that provide similar
products and services and are technologically proficient, will emerge
and will be competing with the Company. As is often the case, if the
Company's plans prove successful it is likely that a number of other
companies, virtually all of whom have greater financial resources and
market recognition than the Company, will look to provide services
similar to those planned by the Company. The Company does not have
proprietary technology that would preclude or inhibit competitors from
entering their markets. The Company intends to compete on the basis of
price and the quality of its services. Further, the market for Internet
development is relatively new and subject to continuing definition, and,
as a result, the existing business of competitors may better position
them to compete in this market as it matures. In addition, the Company
will be competing with established companies as well as established
industry leaders who seek to expand their marketing efforts to include
the Internet. Consequently, the Company will be competing with many
other companies for a share of the available market and no assurance
can be given that in the future the Company will be able to achieve an
adequate position to achieve commercial success or that such competition
will not materially adversely affect the Company's business, results of
operations and financial condition.
Risk of Obsolescence; Technological Change. All industries based upon
innovative technology, such as Internet companies, are characterized by
rapid technological advances, evolving industry standards in computer
hardware and software technology, changes in customer requirements and
frequent new developments and technological enhancements. As a result,
the Company's ability to remain competitive will depend in significant
part upon its ability to continually upgrade its systems and service to
keep up with such technological advances and changes in a timely and
cost-effective manner in response to both evolving demands of the
marketplace and product/service offerings by its competitors. Should a
technological breakthrough be made by a competitor of the Company, the
technology upon which the Company has based its services could become
obsolete and the Company could lose a significant share of its market
unless it is able to redesign its systems to keep pace with developing
technology. In addition, over the longer term, the Company s ability to
remain competitive will depend in significant part upon its ability to
develop and introduce, in a timely and cost-effective manner,
enhancements to its basic products and services which incorporate new
technological advances that provide a competitive advantage over its
competition. Any delay or failure by the Company to develop new services
or to adapt its services to technological change and market requirements
could have a material adverse effect on the Company's financial condition
and results of operation. There can be no assurance that the Company
will be successful in keeping up with technological changes in the future
or that it will have adequate financing to make necessary upgrades in its
system and service in order to maintain a competitive advantage in the
market, on a timely and cost-effective basis. Nor can there be any
assurance that the Company's competitors will not develop superior
services or that such services will not achieve greater market acceptance
than the Company's services.
Liability For Information Services. Because content made available by
third parties may be downloaded by the online services operated by the
Company and may be subsequently distributed to others, there is a
potential that claims will arise against the Company for defamation,
negligence or personal injury, or based on other theories due to the
nature of such content. Such claims have been brought, and sometimes
successfully asserted, against online service providers in the past. In
addition, the Company could be exposed to liability with respect to the
content and materials that may be posted by users in services offered by
the Company. Such claims may include, among others, claims that by
providing hypertext links to Internet sites operated by third parties,
the Company is liable for wrongful actions by such third parties through
such Internet sites. It is also possible that users could make claims
against the Company for losses incurred in reliance on information
provided on the Company's online services. Although the Company intends
to carry general liability insurance, the Company's insurance may not
cover potential claims of this type or may not be adequate to fully
indemnify the Company. Any imposition of liability or legal defense
expenses that are not covered by insurance or are in excess of insurance
coverage could have a material adverse effect on the Company's business,
results of operations and financial condition.
Dependence on Continued Growth of the Internet; Dependence on Internet
Infrastructure. The Company's success is substantially dependent upon
continued growth in the use of the Internet. There can be no assurance
that the number of Internet users will continue to grow or that the use
of the Internet will become more widespread. As is typical in the case
of a new and rapidly evolving industry, demand and market acceptance for
recently introduced services are subject to a high level of uncertainty.
The Internet may not prove to be a viable commercial marketplace for a
number of reasons, including lack of acceptable security technologies,
lack of access and ease of use, reliability, congestion of traffic,
inconsistent quality of service and lack of availability of
cost-effective, high-speed service, potentially inadequate development of
the necessary infrastructure, excessive governmental regulation,
uncertainty regarding intellectual property ownership or timely
development and commercialization of performance improvements, including
high speed modems.
The Company's success also depends upon, among other things, the
continued development of maintenance of a viable Internet infrastructure
to support continued growth in the use of the Internet. The maintenance
and improvement of this infrastructure will require timely development of
products, such as high speed modems and communication equipment, to
continue to provide reliable Internet access and improved content. The
current Internet infrastructure may not be able to support an increased
number of users or the decreased bandwidth requirements of users, and, as
such, the performance or reliability of the Internet may be adversely
affected.
Lack of Public Market For Securities. There currently is no public
market for the Company's securities, nor can there be any assurance that
a public market will develop in the future.
Shares Eligible for Future Sale. A total of 7,010,000 shares of Common
Stock are presently issued and outstanding, of which in excess of
6,500,000 shares thereof are "restricted securities" as that term is
defined under the Securities Act. Therefore, all such restricted shares
must be held indefinitely unless subsequently registered under the
Securities Act or an exemption from registration becomes available. One
exemption which may be available in the future is Rule 144 adopted under
the Securities Act. As of the date of this report, 4,575,200 shares may
be eligible for sale pursuant to Rule 144. Generally, under Rule 144 any
person holding restricted securities for at least one year may publicly
sell in ordinary brokerage transactions, within a 3 month period, the
greater of one (1%) percent of the total number of the Company's shares
outstanding or the average weekly reported volume during the four weeks
preceding the sale, if certain conditions of Rule 144 are satisfied by
the Company and the seller. Furthermore, with respect to sellers who are
"non-affiliates" of the Company, as that term is defined in Rule 144 the
volume sale limitation does not apply and an unlimited number of shares
may be sold, provided the seller meets certain other conditions
enumerated in Rule 144 including a holding period of 2 years. Sales
under Rule 144 may have a depressive effect on the market price of the
Company's securities, should a public market develop or continue for the
Company's shares.
Additional Financing. The Company will require additional financing in
order to complete implementation of its proposed business plan and fully
develop its planned operations as discussed under "BUSINESS OF THE
COMPANY." Further, assuming that the Company is able to establish
successful commercial operations, it is likely that the Company will
require subsequent additional financing in the future. There can be no
assurance that such financing will be available or, if available, that it
can be obtained on terms favorable to the Company.
Forward Looking Statements. This document contains forward-looking
statements. Readers are cautioned that all forward-looking statements
involve risk and uncertainty. Although the Company believes that the
assumptions underlying the forward-looking statements contained herein
are reasonable, any of the assumptions could be inaccurate, and
therefore, there can be no assurance that the forward-looking statements
included in this document will prove to be accurate. In light of the
significant uncertainties inherent in the forward-looking statements
included herein, the inclusion of such information should not be regarded
as a representation by the Company or any other person that the
objectives and plans of the Company will be achieved. (See "Forward
Looking Statements", PART 1).
c) Reports to Security Holders
Prior to the filing of this registration statement on Form 10-SB, the
Company was not subject to the reporting requirements of Section 13 (a)
or 15 (d) of the Exchange Act. Upon effectiveness of this registration
statement, the Company will file annual reports, which will include
audited financial statements, and other required reports and such reports
will be available to its shareholders.
The public may read and copy any materials filed with the SEC at the
SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. The public may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an
Internet site that contains reports, proxy and information statements,
and other information regarding issuers that file electronically with the
SEC. The address of that SEC Internet site is (http://www.sec.gov). The
Company's Internet site is currently under development, but may be viewed
as discussed in " ITEM 1, Section III. Lifen, Inc.'s Web Site".
ITEM 2. PLAN OF OPERATION
For a complete understanding, this Plan of Operation should be read in
conjunction with Part 1, Item 1, Description of Business and Part F/S-
Financial Statements to this Form 10-SB.
For the years ended August 31, 2000 and 1999, the total loss for the
Company was $43,815 and $25,670, respectively. From inception, November
10, 1997, through August 31, 2000, the total loss was $69,654. These
losses resulted from the Company's start-up expenses, initial market
research activities, and initial web site development, which have been
funded by Ameristar Group, Incorporated, an affiliate of two corporate
shareholders of the Company (Refer to "ITEM 7. CERTAIN RELATIONSHIPS
ANDRELATED TRANSACTIONS"), and by the private placement sale of shares of
Common Stock totaling $45,000 in April, 2000 (Refer to" PART II. ITEM 4.
RECENT SALE OF UNREGISTERED SECURITIES"). No assurance can be made that
Ameristar Group, Incorporated will continue to fund the Company's
operations nor that the Company will be able to raise additional funds
through the private placement sale of its securities.
The audit report accompanying the Company's financial statements contains
a going concern qualification because the Company is in the development
stage and needs additional capital to begin commercial operations. Refer
to "RISK FACTORS" and the audit report and financial statements contained
in "PART F/S".
In regard to its capital requirements for the next twelve months,
additional funding will be required and the Company plans to commence a
private placement offering of its Common Stock during November, 2000. The
planned offering will be made pursuant to the exemption from the
registration provisions of the Securities Act of 1933, as amended,
afforded by Rule 506 of Regulation D promulgated thereunder. The current
plan for this private placement is to offer 1,500,000 shares of Common
Stock at a price of $1.00 per share, on a best efforts basis, with no
minimum. The Offering will be made by the Company's officers and
directors. No assurance can be given that such offering, if conducted,
will be successful in raising the funds required to develop and implement
the Company's planned business operations. Issuing additional equity will
result in dilution to the existing shareholders.
The Company is considered to be a development stage enterprise because it
has not yet generated revenue from the sale of products or services.
There have been no business operations since the date of incorporation.
Since its inception, the Company has devoted all of its efforts to
business research and development, the preparation of a business plan,
planning development of a website and the search for sources of capital
to fund its efforts.
In addition to the Company's projected expenses and cash flow, financing
requirements will depend on other factors, such as the progress of its
market research and development, any changes resulting from continuing
research, development of new technology, and the economic impact of
competition. The Company's future long-term capital requirements will
depend significantly on the rate of its business growth, the introduction
of services, and the success of such services after they are introduced.
Projections of future long-term cash needs are subject to substantial
uncertainty.
The Company's success in achieving profitability will depend on its
ability to implement its marketing strategy and obtain the projected
revenues from the sale of products and services, while not exceeding
budgeted expenses. During the implementation of its business plan, the
Company will be subject to all of the risks inherent in a growing
business, including the need to provide reliable and effective products
and services, to develop marketing expertise, and to effectively
generate sales. In the event that the Company's projected market does not
develop as anticipated, the Company's business, financial condition and
results of operations would be materially adversely affected.
During the next twelve months, the Company intends to perform the
activities required to establish its business operations, as described in
"ITEM 1 (b) Business of Issuer". In executing its current plans, the
Company's objectives will include the following:
-- Create the Lifen Wellness Center
-- Attract a sufficiently large membership base to sustain business
operations
-- Develop brand awareness
-- Develop and provide desired services to individual and corporate
clients
-- Build an operations structure to support the business
-- Further develop and expand the Lifen web site, and develop traffic
-- Develop eCommerce business
-- Establish strategic relationships
-- Develop management information systems and technology to support
operations
-- Attract and retain qualified personnel
The Company is not planning to perform any product research and
development during the next twelve months, nor does it contemplate the
purchase or sale of plant and significant equipment such as that related
to manufacturing. The Company intends to acquire fitness equipment and
business equipment for its Wellness Center, and plans to consider various
financing alternatives for such equipment acquisition. The Company's
planned eCommerce business does not require the purchase of inventory.
The Company intends to hire employees during the next twelve months as
its business plan is executed, which will be dependent on the Company's
ability to raise the required funds. In the interim, the Company will
rely on its management to perform the activities required for preliminary
business development. The failure to attract and retain the required
personnel would have a material adverse effect on the Company's business
and results of operations.
Inflation
The Company is unable to accurately predict what effect, if any,
inflation will have on business operations in the future. Further, the
Company is unable to predict what effect any new services or products
will have on future operations, since this will be an evolving part of
its business.
Year 2000 Compliance
The Company has not experienced any problems to date or incurred any
costs as a result of the Year 2000 issue.
ITEM 3. DESCRIPTION OF PROPERTY
The Company is located at 444 Madison Avenue, New York, New York 10022,
and the telephone number is (212) 750-7878. The Company is currently
renting office space on a month to month basis from Ameristar Group,
Incorporated, an affiliate of two corporate shareholders of the Company
, at a monthly rental of $1,000 (SEE ITEM 7. CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS). The Company currently has no material assets, and
the Company does not own any real estate property.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth, as of the date of this report,
information with respect to (1) any person known by the Company to own
beneficially more than five (5%) percent of the Company's Common Stock,
based on 7,010,000 shares issued and outstanding as of the date of this
report (2) Common Stock owned beneficially by each officer or director
of the Company and (3) the total of the Company's Common Stock owned
beneficially, directly or indirectly, by the Company's officers and
directors.
Name and Address of Beneficial Owner Number of Shares Percent of
Owned (1) (2) Class
J.J. Kadele, Inc.
37 Parkway East 1,125,000 16.05%
Yonkers, N.Y. 10701
Pearlco
50 Pecan Valley Drive 808,300 11.53%
New City, N.Y. 10956
Robert Gordon*
444 Madison Avenue, Suite 1710 760,000 10.84%
New York, N.Y. 10022
Dominick Artuso, M.D., F.C.C.M.*
80 Beecher Street 500,000 7.13%
Southbury, CT 06488
Thomas Cerabona, M.D.*
21 Adams Farm Road 150,000 2.14%
Katonah, NY 10523
William Cleary
337 Walnut Lane 600,000 8.56%
Cranford, NJ 07016
John Messina
11 Wyman Street 568,000 8.10%
Rye Brook, NY 10573
Henry A. Gallo* 150,000 2.14%
5 Jonathan Drive
Mahopac, NY 10541
Charles F. Glassman, M.D., F.A.C.P.* 150,000 2.14%
4 Bogey Place
Montebello, NY 10901
Gera Laun* 25,000 .36%
444 Madison Avenue, Suite 1710
New York, N.Y. 10022
Officers and Directors
as a group (6 persons) (3) 1,735,000 24.75%
*Officer and/or Director
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS
Name Age Position
Robert Gordon 65 President and Director
Dominick Artuso, M.D., F.C.C.M. 43 Vice President and Director
Thomas Cerabona, M.D. 44 Vice President
Charles F. Glassman, M.D., F.A.C.P.40 Vice President
Henry A. Gallo 52 Vice President
Gera Laun 36 Secretary and Director
The Company makes extensive use of the services of its Directors,
Advisors and outside professionals.
The Directors will serve until the next annual meeting of stockholders
and until their successors are qualified and elected. The Officers are
also appointed by, and serve at the will of, the Board of Directors.
There are no family relationships among the Officers of the Company.
There are at present no committees of the Board of Directors.
Profiles of Officers and Directors
Robert Gordon is President and a Director. Mr. Gordon is also Executive
Vice President of W3 Group, Inc. and formerly Executive Vice President
of Contex, Inc., an investment banking and consulting firm in Naples,
Florida. Previously, as Managing Director of a specialty apparel company,
he was responsible for marketing and sales, finance, manufacturing,
retail and mail order operations, MIS, strategic planning, organizational
development, and re-structuring the business. Mr. Gordon was President
and Chief Operating Officer of a public company that manufactured
precision parts and performed engineering design services, and conducted
technology research and development. Previously, he was Executive Vice
President of a financial services firm, responsible for administration,
business operations, and organizational development. Mr. Gordon also had
a management consulting practice and performed broad based professional
services which included strategic and financial planning, marketing and
growth studies, business re-structuring, acquisition plans,
implementation of new business strategies, MIS development, and training
programs. Previously, Mr. Gordon was Director of MIS for Kinney Shoe
Corporation.
Mr. Gordon has conducted numerous business seminars and made
presentations at many conferences. He received an Achievement Award from
the International Association of Systems Management in recognition of his
contribution to the business systems profession, and is also a past
Chapter President. He was an advisor to Guidance International, a
professional association of computer users. Mr. Gordon has a B.A. in
Economics from Union College.
Dominick Artuso, M.D., F.C.C.M. is Vice President and a Director of the
Company, and a member of the Bariatric Department at the Westchester
Medical Center in Valhalla, NY. The mission of the department is to
perform Gastric Bypass Surgery ("stomach Stapling") for morbidly obese
patients. The care and preparation of the morbidly obese patient is
unique, complex, and involves a multi disciplinary approach. This team
effort has been developed and continuously monitored by Dr. Artuso and
his partners Thomas Cerabona, M.D., director of the Bariatric Surgery
Department and Julio Teixeira, M.D. Director of Laprascopic Surgery
Department.
Dr. Artuso graduated from the University of Notre Dame, Indiana with a
Bachelor of Science degree. He then graduated from the Cetec University
in Santo Domingo, Dominican Republic with an M.D. degree. His specialty
is General Surgery with special training in trauma and surgical critical
care. He developed and directed two Level II Trauma Centers; one in Ft.
Meyers, Florida and one in Waterbury, Connecticut.
At this time Dr. Artuso's efforts are concentrated on the treatment of
obesity. Presently he and his team members have been performing Gastric
Bypass Surgery laprascopically, one of less than 12 centers in the USA
performing it in that manner. In the last twelve months, they have
modified and improved the procedure three times, with each modification
being reported nationally. Besides these reports, Dr. Artuso reported on
the results of their surgery at the American Bartatric Society meeting in
June 2000 in Memphis, Tenn.
In addition to surgery for morbid obesity, Dr. Artuso has been performing
extensive counseling to obese patients. This counseling has taken the
form of nutritional advice including nutritional supplements and herbal
remedies for weight loss and various illnesses. The counseling has also
included psychological evaluation and subsequent treatment courses. Also
included in the counseling is exercise and activity recommendations.
Presently Dr. Artuso is implementing acupuncture and hypnotism to the
total wellness program provided to obese individuals.
Thomas Cerabona, M.D. ia a Vice President of the Company. Dr. Cerabona is
Director of the Bariatric Department at Westchester Medical Center in
Valhalla, New York. As Director of the Department, he has been
instrumental in developing techniques to improve the outcome and decrease
the hospitalization of morbidly obese gastric bypass patients.
Dr. Cerabona received his undergraduate degree from Fordham University
and graduated from New York Medical College. In addition to completing
a surgical residency and developing special expertise in Bariatric
surgery, he completed a surgical critical care fellowship and is
certified in critical care. Dr. Cerabona has also had much involvement
with the Trauma Service at Westchester Medical Center, the first
certified Level 1 Trauma Center in New York State.
Dr. Cerabona has lectured on numerous occasions on Morbid Obesity,
including its prevalence, etiology, complications, and medical and
surgical treatment options. He has also lectured extensively on other
subjects, including General Surgery, Trauma, and Critical Care. Dr.
Cerabona has added integrative medicine techniques to his care of obese
patients.
Charles F. Glassman, M.D., F.A.C.P. is a Vice President of the Company.
Dr. Glassman practices general internal medecine and is on the staff at
Nyack, New York and Good Samaritan Hospital in Suffern, New York. He is
also an Assistant Professor of clinical Medicine at New York Medical
College in Geneva, New York. Dr. Glassman has a large clinical experience
with a myriad of disease states, but his focus has always been on the
prevention of diseases. Before complimentary medicine had become popular,
Dr. Glassman had become familiar with various more natural modalities for
the treatment and prevention of certain ailments. Dr. Glassman can now
offer these vitamins and herbal products to his patients in his mostly
allopathic center. Dr. Glassman believes that the use of complementary
medicine has resulted in much success in his patients ability to maintain
a healthy weight and concentrate more on healthy living. Dr. Glassman
graduated from Hobart College with a degree in Bachelor Of Science, and
received Magna Cum Laude honors. He was elected to Phi Beta Kappa,
received the Bienart Award for excellence in Mathematics, and a
Distinction Award for his Baccalaureate essay. Dr. Glassman received his
M.D. degree from New York Medical College, and his residency training
began in surgery at Montefiore Medical Center. He later transferred to
Westchester Medical Center to complete his residency in general internal
medicine.
Henry A. Gallo is Vice President of the Company. He is also Executive
Director and President of Medcon Associates, Inc., a health and training
consulting firm. Under Mr. Gallo's direct supervision, Medcon's
professional staff teaches seminars sponsored by the New York Medical
College, which are accredited by the Accredation Council for continuing
Medical Education (ACCME) for physicians and approved by the American
Association of Critical Care Nurses (AACN). Medcon also provides courses
required and approved by the New York State Department of Education.
Medcon's services include drug testing for the Department of
Transportation, OSHA Medical Compliance Reviews, and a physician speaker
service. Medcon is an approved government contractor and an approved
training vendor, and has trained a wide spectrum of individuals including
health care providers, FBI and DEA Agents, and the nursery staff at Club
Fit Health Club. Concurrently, Mr. Gallo maintains his professional
skills by performing part time work as an operating room nurse in a
regional level 1 trauma center. Mr Gallo is a Major in the New York Army
National Guard and is the Commander of the largest Army Health and Dental
Clinic in New York serving approximately 7,500 troops. The clinic
provides a full range of medical and diagnostic services provided by
Physicians, Physician Assistants, Nurse Practitioners, Dentists, Medics
and specialized technicians. Previously, as Training Officer to New York
State's Medical Detachment, Mr. Gallo implemented Federal and State
health compliance standards for the four Health and Dental Clinics which
serve approximately 13,000 troops and he provided training to 172
professional staff members. His duties also include the development and
implementation of statewide certification programs, including Advanced
Cardiac Life Support, Basic Life Support, and a course in Bloodborne
Pathogens.
Gera Laun is Secretary and a Director of the Company. Ms. Laun is also
Secretary and Treasurer of Ameristar Capital Corporation, an equipment
leasing company. Previously, she was Secretary of Concorde Strategies
Group, Inc., Manager, Processing Department of Vendor Funding Co., Inc.,
an equipment leasing and asset based lending company, and Manager, Mail
Order Catalog/Retail for La Shack, Inc.
Advisors
Chris Silkwood, Director of Wellness, has long been one of the country's
leading health/fitness and lifestyle authorities. She is founder and
managing director of Personal Best Enterprises, a Houston-based
consulting and training firm. Her client focus is well-being, building
organizational relationship and performance improvement. She works with
corporations of all sizes who have an interest in building and sustaining
a high energy workforce.
Ms. Silkwood is a graduate of Wayne State University in Michigan with a
combined degree in exercise physiology and psychology. She is a trusted
"wellness" resource to media across the country and, among other
distinctions, was named by Vogue magazine as one of the three most
prominent health consultants in the United States.
She has developed spa resorts, fitness centers and sports medicine
complexes throughout the United States and abroad. Ms. Silkwood served as
director of The Phoenix Spa at The Houstonian and former fitness director
at the acclaimed Golden Door Spa in Escondido, California.
Her attention is now focused on the well-being of today's workforce. As
companies restructure and eliminate people, positions and long-held
perquisites, further loss is incurred in employee loyalty, dedication and
belief that the company cares about individual well-being.
Ms. Silkwood has been featured in numerous national publications such as
USA Today, American Health, Vogue, Town & Country, Shape, Self, New Woman
and Family Circle. She has appeared on radio and television talk shows in
most major cities as well as on network and cable TV programs including
NBC's "Today show", ABC's "Good Morning, America," and the syndicated
"Regis Philbin Show."
Chris was selected by former President George Bush to serve on the
President's Council for Physical Fitness and Sports throughout his
administration. She is the co-author of "Awesome Teen" a book which is
focused on fitness, healthy food and life-style for teenagers.
Bruce H. Sindler, M.D. F.A.C.E. has been in private practice in
Endocrinology and Diabetes in Baltimore, Maryland since 1982. Previously,
Dr. Sindler was a Fellow in Endocrinology and Metabolism at University
Hospital, Boston University School of Medicine after completing his
Residency and Internship in Internal Medicine at Boston City Hospital.
Dr. Sindler received a B.S. degree from Syracuse University, receiving
Summa Cum Laude honors and was elected to Phi Beta Kappa. He attended
Chicago Medical School and received his M.D. degree from the University
of Maryland School of Medicine. Dr. Sindler was President of the Maryland
Chapter of the American Association of Clinical Endocrinologists in 1996,
and also a member of the Speakers Bureau for the Sankyo Parke Davis
Company and Bristol-Meyers Squibb Company in 1996. His professional
memberships include the American College of Physicians, American Diabetes
Association, Maryland Medical and Chirurgical Faculty and the American
Association of Clinical Endocrinologists. Dr. Sindler's bibliography and
abstracts have been published since 1982.
ITEM 6. EXECUTIVE COMPENSATION
The Company has paid consulting fees totaling $6,500 to its President
during the year ended August 31, 2000. No other compensation has been
paid to any of the Company's Officers and Directors. There are no written
agreements between the Company and any of its Officers, and there are no
agreements with Directors for the payment of Director fees. The Company
does not presently have any pension plan, profit sharing plan, or similar
plans for the benefit of its Directors, Officers or employees.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company currently rents office space on a month to month basis from
Ameristar Group, Incorporated ("Ameristar"), an affiliate of two
corporate shareholders of the Company, at a rate of $1,000 per month. In
addition, Ameristar is currently providing administrative services on a
month to month basis to the Company at a monthly cost of $2,000 and has
advanced funds for operating expenses. The total expenses incurred by the
Company from Ameristar for the years ended August 31, 2000 and 1999, and
from inception, November 11, 1997 through August 31, 2000 are $27,500,
$16,616, and $46,524, respectively. At August 31, 2000, accounts payable
due to Ameristar was $15,072 (See Note 4 to Financial Statements).
ITEM 8. DESCRIPTION OF SECURITIES
Common Stock
The authorized capital stock of the Company consists of 25,000,000 shares
of Common Stock, par value $.0001 per share of which 7,010,000 shares are
issued and outstanding. The holders of Common Stock (I) have equal and
ratable rights to dividends from funds legally available therefore, when,
as and if declared by the Board of Directors of the Company: (ii) are
entitled to share ratably in all of the assets of the Company available
for distribution to holders of Common Stock upon liquidation, dissolution
or winding up of the affairs of the Company; (iii) do not have pre-
emptive, subscription or conversion rights (there are no redemption or
sinking fund provisions applicable thereto); and (iv) are entitled to one
non-cumulative vote per Share on all matters which shareholders may vote
at all meetings of shareholders. All shares of Common Stock now
outstanding are fully paid for and non-assessable. There are no
provisions in the Articles of Incorporation or By-laws which would have
an effect of delaying, deferring, or preventing a change in control of
the Company and that would operate only with respect to an extraordinary
corporate transaction involving the Company, such as a merger,
reorganization, sale, or transfer of all or substantially all of the
Company's assets, or a liquidation.
Preferred Stock
The authorized capital stock of the Company consists of 10,000,000 shares
of Preferred Stock, $.0001 par value per share of which no shares are
issued and outstanding. The Preferred Stock is issuable in one or more
series by authority of the Board of Directors, without shareholder
approval. The Board of Directors has the authority to determine the
rights, privileges, and preferences of any such series so designated by
the Board. Such Preferred Stock may rank prior in right to the Common
Stock with respect to payment of dividends and return of capital in the
event of dissolution, liquidation or winding up of the Company.
Non-cumulative Voting
The holders of shares do not have cumulative voting rights, which means
that the holders of more than 50 percent of such outstanding shares,
voting for the election of directors, can elect all of the directors to
be elected, if they so choose, and in such event, the holders of the
remaining shares will not be able to elect any of the Company's
directors. As of the date of this report, present management own
approximately 24.75 percent of the issued and outstanding Common Stock
and is able to elect all of the directors and appoint all of the
Company's officers.
PART II
ITEM 1. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY
AND RELATED STOCKHOLDER MATTERS.
As of the date of this registration statement, there is no public market
for the Company's securities. Upon effectiveness of this registration
statement, the Company intends to apply for a listing of its Common Stock
on the OTC Bulletin Board. There can be no assurance that the OTC
Bulletin Board will approve the listing application or, if the
application is approved, that a market will develop for the Company's
Common Stock. In the event that the Company's listing application is
approved, its Common Stock may be thinly traded, if traded at all, until
such time as the Company achieves full operation and has significant
revenue.
As of the date of this report, there were 38 record holders of the
Company's Common Stock.
The Company has not paid any cash dividends since its inception and does
not anticipate paying dividends in the foreseeable future. It is
anticipated that earnings, if any, will be retained for the operation of
the Company's business.
ITEM 2. LEGAL PROCEEDINGS
The Company, or any officer or director, is not a party to any
litigation, nor to the knowledge of management, is any litigation
currently pending or contemplated against the Company or any of its
officers or directors in their capacity as such.
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
None.
ITEM 4. RECENT SALE OF UNREGISTERED SECURITIES
The following transactions describe the sale of unregistered securities
by the Company during the last three years. All of the shares were sold
privately by the Company and not offered to the public, and were not
registered under the Securities Act of 1933 (the "Act"), as amended.
(a) On January 9, 1998, the Company issued a total of 2,250,000
shares of its Common Stock to two founders who had performed
services on behalf of the Company. The shares were issued in
consideration for cancellation of debt owed by the Company, at
the agreed upon rate of $.0001 per share.
(b) On October 30, 1998, the Company issued a total of 2,750,000
shares of its Common Stock to four parties who had performed
services on behalf of the Company. The shares were issued in
consideration for cancellation of debt owed by the Company, at
the agreed upon rate of $.0001 per share. After the Company
ended its involvement with ThinkTanks, those four parties
agreed to return their shares to the Company, and all of the
2,750,000 shares were subsequently cancelled.
.
The shares described in (a) and (b) above were issued in reliance on
the exemption from registration provided by Section 4 (2) of the Act.
The parties who received the shares are sophisticated investors who
were knowledgeable about the Company's operations and financial
condition at the time of receipt of the shares and were able to
evaluate the risks and merits of receipt of the shares, and, in the
case of the parties receiving stock for services, each of them agreed
to accept the shares as compensation for the services they had
performed.
(c) On November 5, 1998, the Company completed a private placement
offering of its Common Stock pursuant to the exemption from the
registration provisions of the Securities Act of 1933, as
amended, afforded by Rule 504 of Regulation D promulgated
thereunder. Under the terms of that Offering, the Company
issued 500,000 shares of its Common Stock in exchange for the
satisfaction of $25,000 in debts owed by the Company to four
parties who had performed services on behalf of the Company.
The Company did not receive any cash proceeds from this
Offering, and the 500,000 shares were issued at the agreed upon
rate of $.05 per share. At the time of this private placement,
the Company was not registered with the SEC under Section 12(g)
of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and was not subject to the reporting
requirements of Section 13 or 15 of the Exchange Act.
(d) On March 3, 1999, the Company issued 2,325,200 shares of its
Common Stock to eight parties who had performed services on
behalf of the Company. The shares were issued in consideration
of debt owed by the Company, at the agreed upon rate of $.0001
per share, and the shares were sold in reliance on the
exemption provided by Section 4 (2) of the Act.
(e) On March 15, 2000, the Company issued 1,219,800 shares of its
Common Stock to ten parties who had performed services on
behalf of the Company. The shares were issued in consideration
of debt owed by the Company, at the agreed upon rate of $.0001
per share, and the shares were sold in reliance on the
exemption provided by Section 4 (2) of the Act.
(f) During April, 2000, the Company sold 45,000 shares of its
Common Stock at a price of $1.00 per share to three investors
in a private placement, with total proceeds received of
$45,000. There were no expenses for this placement, and the
shares were sold pursuant to the exemption from the
registration provisions of the Securities Act of 1933, as
amended, afforded by Rule 504 of Regulation D promulgated
thereunder. At the time of this private placement, the Company
was not registered with the SEC under Section 12 (g) of the
Securities Exchange Act of 1934, as amended, (the "Exchange
Act"), and was not subject to the reporting requirements of
Section 13 or 15 of the Exchange Act.
(g) On October 2, 2000, the Company issued 660,000 shares of its
Common Stock to six parties who had performed services on
behalf of the Company. The shares were issued in consideration
of debt owed to the Company, at the agreed upon rate of $.0001
per share, and the shares were sold in reliance on the
exemption provided by Section 4 (2) of the Act.
(h) On October 6, 2000, the Company sold 10,000 shares of its
Common Stock to one investor at a price of $1.00 per share,
which was paid for in cash totaling $5,000 and services
totaling $5,000. The shares were sold in reliance on the
exemption provided by Section 4 (2) of the Act.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Articles of Incorporation and Bylaws provide that the
Company shall indemnify its directors and officers to the fullest extent
permitted by the General Corporation Law of Delaware, including
circumstances in which indemnification is otherwise discretionary under
Delaware law. Such limitation of liability does not affect the
availability of equitable remedies such as injunctive relief or
recission. Section 145 of the General Corporation Law of Delaware
provides for the indemnification of officers, directors and other
corporate agents in terms sufficiently broad to indemnify such persons,
under certain circumstances, for certain liabilities (including
reimbursement of expenses incurred) arising under the Securities Act of
1933 (the "Securities Act"). These provisions generally permit
indemnification of directors and officers against certain costs,
liabilities and expenses of any threatened, pending, or completed action,
suit or proceeding that any such person may incur by reason of serving in
such positions if the person acted in good faith and in a manner the
person reasonably believed to be in or not opposed to the best interests
of the corporation, except that no indemnification shall be made in
respect of any claim, issue or matter as to which such persons had been
adjudged to be liable to the corporation, unless and only to the extent
that the court in which such action or suit was brought shall determine
upon application, that, despite the adjudication of liability but in view
of all of the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the court shall
deem proper.
PART F/S
Audited Financial Statements for the year ended August 31, 2000 are
submitted herein on Pages F-1 to F-9.
PART III
ITEM 1. INDEX TO EXHIBITS.
The Exhibits listed and described below in Item 2 are filed herein as
part of this registration statement.
ITEM 2. DESCRIPTION OF EXHIBITS.
The following documents are filed herein as Exhibit Numbers 2,3,5,6, and
7 as required by Part III of Form 1-A and Exhibit 27:
EXHIBIT NUMBER DESCRIPTION
2.0 Charter and By-Laws.
2.1 Certificate of Incorporation filed with Secretary of
State of Delaware on November 10, 1997.
2.2 Certificate for Renewal and Revival of Charter filed
with Secretary of State of Delaware on December 27,
1999.
2.3 Certificate of Amendment of the Certificate of
Incorporation filed with Secretary of State of
Delaware on June 22, 2000, changing the corporation
name to Lifen, Inc.
2.4 By-Laws.
3. NONE Instruments Defining the Rights of Security Holders.
5. NONE Voting Trust Agreement.
6. NONE Material Contracts.
7. NONE Material Foreign Patents.
27. Financial Data Schedules
SIGNATURES
In accordance with Section 12 of the Securities and Exchange Act of 1934,
the Registrant caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized.
Lifen, Inc.
/s/ Robert Gordon
Robert Gordon, President
<PAGE> PART F/S
LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
INDEX TO FINANCIAL STATEMENTS
Page
Report of Independent Certified Public Accountant. F-2
Balance Sheet as of August 31, 2000. F-3
Statement of Operations for the years ended
August 31, 2000 and 1999, and from inception
November 10, 1997 to August 31, 2000. F-4
Statement of Stockholders' Equity (Deficit) from
inception November 10, 1997 to August 31, 2000. F-5
Statement of Cash Flows for the years ended
August 31, 2000 and 1999, and from inception
November 10, 1997 to August 31, 2000. F-6
Note to Financial Statements F 7-9
F-1
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
Lifen, Inc.
I have audited the accompanying balance sheet of Lifen, Inc. (A
Development State Company) as of August 31, 2000 and the related
statement of operations, stockholders' equity and cash flow for the two
years then ended and for the period from November 10, 1997 (inception) to
August 31, 2000. These Financial Statements are the responsibility of the
Company's management. My responsibility is to express an opinion on these
financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I 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 balance
sheet. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. I believe that my audit
provides a reasonable basis for my opinion.
In my opinion, the financial statements referred to above present fairly
in all material respects, the financial position of Lifen, Inc. as of
August 31, 2000 and results of operations, changes in stockholders'
equity and cash flows for the two years then ended and from November 10,
1997 (inception) to August 31, 2000 in conformity with generally
accepted accounting principles.
The accompanying Financial Statements have been prepared assuming the
Company will continue as a going concern. As discussed in Note 5 to the
Financial Statements, the Company is in the development stage and needs
additional funds for them to implement their plan of operations. This
condition raises substantial doubt about its ability to continue as a
going concern. Management's plans regarding this matter is also described
in Note 5. The Financial Statements do not include any adjustments that
might result from the outcome of this uncertainty.
/s/ Sanford H.
Feibusch
Certified Public Accountant
Monsey, New York
September 15, 2000
F-2
LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET AS OF AUGUST 31, 2000
ASSETS
2000
Current Assets:
Cash $ 94
Total Current Assets 94
Equipment Net of Depreciation of $-0- 1,180
Other Assets:
Organization Costs net of accumulated
Amortization of $231 177
Total Assets $ 1,451
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
Current Liabilities:
Accounts Payable $ 17,771
Total Current Liabilities 17,771
Stockholders' (Deficit)
Preferred Stock, par value $.0001
Authorized 10,000,000 shares, no
Shares issued and outstanding -
Common Stock, par value $.0001
Authorized 25,000,000 shares
Issued and outstanding 6,340,000 shares 634
Additional Paid-in capital 52,700
Deficit accumulated during development stage (69,654)
Stockholders' (Deficit) (16,320)
Total Liabilities and Stockholders' (Deficit) $ 1,451
The Accompanying Notes are an integral part of these Financial
Statements.
F-3
LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FOR THE YEARS ENDED AUGUST 31, 2000 AND 1999
AND FROM INCEPTION NOVEMBER 10, 1997 TO AUGUST 31, 2000
From Inception
Nov. 10, 1997
to
2000 1999 August 30, 2000
Revenue: $ - $ - $ -
Expenses:
Market Research - 25,000 25,000
Consulting 10,322 508 10,830
Rent 8,000 - 8,000
Administrative 22,000 - 22,000
Miscellaneous 3,493 162 3,824
Total Expenses 43,815 25,670 69,654
Net Loss before Provision
For Income Taxes (43,815) (25,670) (69,654)
Provision for Income Taxes - - -
Net Loss $ (43,815) $ (25,670) $ (69,654)
Loss per Share $(.01) $(.01) $(.02)
Weighted Average Number
Shares Outstanding 5,492,850 3,316,733 3,990,580
The Accompanying Notes are an integral part of these Financial
Statements.
F-4
<PAGE> LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
FROM INCEPTION NOVEMBER 10, 1997 TO AUGUST 31, 2000
Common Stock Additional
Par Value $.001 Paid-In Retained
Shares Amount Capital (Deficit)
January 1998 Shares Issued
For Services 2,250,000 $ 225 $ - $ -
Loss for Year Ended
August 31, 1998 (169)
Balance August 31, 1998 2,250,000 225 - (169)
October 1998 Shares
Issued for Services 2,750,000 275 - -
Cancellation of Shares
Issued October 1998 (2,750,000) (275) - -
November 1998 Shares issued
For services net of expenses 500,000 50 7,705 -
March 1999 Shares
Issued for Services 2,325,200 232 - -
Loss for the Year ended
August 31, 1999 (25,670)
Balance August 31, 1999 5,075,200 507 7,705 (25,839)
March 2000 Shares
Issued for Services 1,219,800 122 - -
April 2000 Shares
Issued Private Placement 45,000 5 44,995 -
Loss for Year Ended
August 31, 2000 (43,815)
Balance August 31, 2000 6,340,000 $ 634 $ 52,700 $ (69,654)
The Accompanying Notes are an integral part of these Financial
Statements.
F-5
<PAGE> LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS FOR THE YEARS ENDED
AUGUST 31, 2000 AND 1999 AND
FROM INCEPTION NOVEMBER 10, 1997 TO AUGUST 31, 2000
From Inception
Nov. 10, 1997
to
2000 1999 August 31, 2000
Cash Flows from
Operating Activities:
Net (Loss) $ (43,815)$ (25,670) $ (69,654)
Adjustments to reconcile
Net (loss) to Net cash
used in operating activities:
Amortization 82 82 231
Market Research - 25,000 25,000
Consulting 122 232 579
Changes in operating
assets & liabilities:
Organization Costs - - (408)
Accounts Payable (115) 17,601 17,771
Net Cash Flows from
Operating Activities (43,726) 17,245 (26,481)
Cash Flows from Investing Activities:
Purchase Equipment (1,180) - (1,180)
Net Cash Flows from
Investing Activities (1,180) - (1,180)
Cash Flows from Financing Activities:
Issuance Common Stock 45,000 - 45,000
Offering Expenses (17,245) (17,245)
Net Cash Flow from Financing
Activities 45,000 (17,245) 27,755
Net Increase (decrease) in Cash 94 - 94
Cash Beginning of Year - - -
Cash End of Year $ 94 $ - $ 94
The Accompanying Notes are an integral part of these Financial
Statements.
F-6
LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
Note 1 - Organization
Lifen, Inc. (the "Company") was incorporated under the laws of the state
of Delaware on November 10, 1997 under the name Digivision International,
Ltd. The Company's name was changed to Lifen, Inc. on June 22, 2000. To
date, the Company has had no commercial operations and has been engaged
in the development of its business plan, market research, initial web
site development, and seeking initial financing in order to commence
commercial operations.
Note 2 - Summary of Significant Accounting Policies: 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 amount of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenue and expenses
during the reporting period. The most significant estimates relate to the
valuation allowance in connection with deferred tax assets. Actual
results could differ from those estimates.
Intangibles
Organization cost represents the initial fees and cost to incorporate and
are being amortized over 60 months using the straight-line method.
Income Taxes
The Company records deferred income taxes using the liability method.
Under the liability method, deferred tax assets and liabilities are
recognized for the expected future tax consequences of temporary
differences between the financial statement and income tax basis of the
Company's assets and liabilities. An allowance is recorded, based on
currently available information, when it is more likely than not that any
or all of a deferred tax asset will not be realized. The provision for
income taxes includes taxes currently payable, if any, plus the net
change during the period presented in deferred tax assets and liabilities
recorded by the Company.
Per Share Data
The Company has adopted the standards set by the Financial Accounting
Standards Board and computes earnings per share data in accordance with
SFAS No. 128 "Earning per Share." The basis per share data has been
computed on the loss for the period divided by the historic weighted
average number of shares of common stock outstanding. All potentially
dilutive securities have been excluded from the computation since they
would be antidilutive.
Note 2 - Income Taxes
There is no provision for Federal or State Income Taxes for the years
ended August 31, 2000 and 1999, since the Company has incurred losses
from inception. Additionally, the Company has reserved fully for any
potential tax benefits resulting from its carryforward operating losses.
Deferred tax assets at August 31, 2000 and 1999 consist of the following:
F-7
LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
Note 2 - Income Taxes (Continued)
2000 1999
Net Operating loss carryforward $ 24,340 $ 10,330
Valuation allowance (24,340) (10,330)
$ -0- $ -0-
As of August 31, 2000, the Company has net operating loss carryforwards
of approximately $69,000 which expire in various years from 2012 through
2015.
Note 3 - Common Stock
On January 9, 1998, the Company issued 2,250,000 shares of its common
stock to two founders of the Company for services valued at $225.
On October 30, 1998, the Company issued 2,750,000 shares of its common
stock to four individuals for services to be performed. The agreement was
canceled and the shares of common stock were returned and canceled.
On November 5, 1998, the Company completed a private placement offering
of its common stock, Pursuant to Rule 504 under Regulation D, the Company
issued 500,000 shares of its common stock in satisfaction of $25,000 owed
to four parties who had performed services on behalf of the Company.
On March 3, 1999, the Company issued 2,325,200 shares of its common stock
to eight parties for services performed on behalf of the Company, valued
at $232.
On March 15, 2000, the Company issued 1,219,800 to ten parties for
services performed on behalf of the Company, valued at $122.
During April, 2000, the Company sold 45,000 shares of its common stock at
$1.00 per share to three investors in a private placement, pursuant to
Rule 504 under Regulation D, and received total proceeds of $45,000.
Note 4 - Related Party Transactions
Ameristar Group, Incorporated ("Ameristar") is a corporation that is
affiliated to two corporate shareholders of the Company and is considered
to be a related party.
Ameristar rents office space to the Company on a month to month basis, at
a rate of $1,000 per month. In addition, Ameristar has provided
administrative service for the Company and advanced funds for operating
expenses. The total expenses incurred by the Company from Ameristar for
the years ended August 31, 2000 and 1999, and from inception November 11,
1997 through August 31, 2000 are $27,500, $16,616 and $46,524,
respectively. At August 31, 2000 accounts payable due Ameristar was
$15,072.
F-8
LIFEN, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AUGUST 31, 2000
Note 5 - Going Concern
Lifen, Inc. is considered to be a development stage company. Since
inception, the Company has been engaged in the development of its
business plan, market research and initial web site development. In order
to complete the implementation and fully develop its plan of operations,
the Company will require additional financing. There can be no assurance
that such financing will be available.
Note 6 - Supplemental Disclosure to Cash Flow Statement
From Inception
Nov. 10, 1997
to
2000 1999 August 31, 2000
Cash paid during the period for:
Interest $ - $ - $ -
Income Taxes $ - $ - $ -
Non Cash Transactions:
Common stock issued for
consulting Services and
market research $ 122 $25,232 $ 25,579
F-9
EXHIBIT NUMBER 2.1
(Stamped)
State of Delaware
Secretary of State
Division of Corporations
Filed 09:00 AM 11/10/1997
971382127- 2811491
CERTIFICATE OF INCORPORATION
OF
DIGIVISION INTERNATIONAL, LTD.
FIRST: The name of the corporation is DIGIVISION INTERNATIONAL, LTD.
SECOND: Its principal place of business in the State of Delaware is to be
located at 1313 North Market Street, Wilmington County of New Castle,
State of Delaware, 19801. The registered agent in charge thereof is The
Company Corporation at the same address as above.
THIRD: The nature of the business and the objects and purposes proposed
to be transacted, promoted and carried on, are to do any and all things
herein mentioned, as fully and to the same extent as natural persons
might or could do, and in any part of the world, viz:
"The purpose of the corporation is to engage in any lawful act or
activity for which corporation may be organized under the General
Corporation Law of Delaware."
FOURTH: The Corporation shall be authorized to issue a total of THIRTY-
FIVE MILLION shares of capital stock, which shall be issued in TWO (2)
CLASSES of Stock as follows: One Class shall be designated as COMMON
STOCK and shall be the voting stock of the Corporation. The total number
of COMMON STOCK Shares which the corporation is authorized to issue is
TWENTY-FIVE MILLION (25,000,000), with a par value of one hundredth of
one cent ($0.0001) each. The other Class of stock which the Corporation
shall have authority to issue shall be designated as PREFERRED STOCK, and
shall be non-voting stock of the Corporation. The total number of
PREFERRED STOCK Shares which the Corporation shall have authority to
issue shall be TEN (10,000,000) MILLION SHARES which shall have a par
value of one hundredth of one cent ($0.0001) each and which may be issued
in series. The terms, conditions and character of these PREFERRED STOCK
Shares shall be fixed by the Board of Directors of the corporation prior
to the time any of such PREFERRED STOCK shares are issued by the
corporation.
FIFTH: The name and mailing address of the incorporator is as follows:
Regina Cephas 1313 N. Market Street, Wilm., DE 19801-1151
SIXTH: The powers of the incorporator are to terminate upon filing of the
certificate of incorporation, and the name and mailing address of the
persons who will serve as directors until the first annual meeting of
stockholders or until successors are elected and qualify is as follows:
Simone V. Palazzolo, Esq., 444 Madison Avenue, Suite 1710, New York, NY
10022
SEVENTH: The Directors shall have the power to make and to alter or amend
the By-Laws: to fix the amount to be reserved as working capital and to
authorize and cause to be executed mortgages and liens without limit as
to the amount upon the property and franchise of the Corporation.
With the consent in writing and pursuant to a vote of the holders of a
majority of the capital stock issued and outstanding, the Directors shall
have the authority to dispose, in any manner, of the whole property of
this Corporation.
The by-laws shall determine whether and to what extent the accounts and
books of this Corporation, or any of them shall be open to the inspection
of the stockholders; and no stockholder shall have any right of
inspecting any account, or book or document of the Corporation, except as
conferred by the laws or by-laws or by resolution of the stockholders.
The stockholders and directors shall have power to hold their meetings
and keep books and records outside of the State of Delaware, at such
places as may be from time to time designated by the by-laws or by
resolution of the stockholders or directors, except as otherwise required
by the laws of Delaware.
It is the intention that the objects, purposes and powers specified in
the third paragraph hereof shall, except where otherwise specified in
said paragraph, be nowise limited or restricted by reference to or
inference from the terms of any other clause or paragraph in this
certificate of incorporation, but that the objects, purposes and powers
specified in the Third paragraph and in each of the clauses or paragraphs
of this charter shall be regarded as independent objects, purposes and
powers.
EIGHTH: No director shall be personally liable to the corporation or its
stockholders for monetary damages for any breach of fiduciary duty by
such director as a director, except (I) for breach of the directors duty
of loyalty to the corporation or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of the law, (iii) pursuant to Section 174 of the
Delaware General Corporation Law, or (iv) for any transaction from which
the director derived an improper personal benefit. No amendment or repeal
of this Article Eighth shall apply to or have any effect on the liability
or alleged liability of any director of the corporation for or with
respect to any acts or omissions of such director occurring prior to such
amendment or repeal.
I, THE UNDERSIGNED, for the purpose of forming a Corporation under the
laws of the State of Delaware, do make, file and record this Certificate,
and do certify that the facts herein are true; and that I have
accordingly hereunto set my hand.
DATED AT: 11/10/97
STATE OF DELAWARE
COUNTY OF NEW CASTLE
/s/ Regina Cephas
EXHIBIT NUMBER 2.2
State of Delaware
Office of the Secretary of State
___________________________
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE
CERTIFICATE
OF RENEWAL OF 'DIGIVISION INTERNATIONAL, LTD.", FILED IN THIS OFFICE ON
THE TWENTY-SEVENTH DAY OF DECEMBER, A.D. 1999, AT 9 O'CLOCK A.M.
A FILED COPY OF THIS CERTIFICATE HAS BEEN FORWARDED TO THE NEW
CASTLE
COUNTY RECORDER OF DEEDS.
(SEAL) /EDWARD J. FREEL,
Edward J. Freel, Secretary of State
Authentication: 0196411
Date: 01-12-00
STATE OF DELAWARE
CERTIFICATE FOR RENEWAL
AND REVIVAL OF CHARTER
Digivision International, Ltd., a corporation
organized under the laws of Delaware, the charter of which was voided for
non-payment of taxes, now desires to procure a restoration, renewal and
revival of its charter, and hereby certifies as follows:
1. The name of this corporation is Digivision International, Ltd.
2. Its registered office in the State of Delaware is located at
1013 Centre Road, City of Wilmington, DE Zip Code 19805County of
New Castle the name and address of its registered
agent is The Company Corporation.
3. The date of filing of the original Certificate of Incorporation
in Delaware was November 10, 1997.
4. The date when restoration, renewal, and revival of the charter
of this company is to commence is the 23rd day of November,
1999 , same being prior to the date of the expiration of
the charter. This renewal and revival of the charter of this
corporation is to be perpetual.
5. This corporation was duly organized and carried on the business
authorized by its charter until the 1st day of March A.D.
1999, at which time its charter became inoperative and void for
non-payment of taxes and this certificate for renewal and
revival is filed by authority of the duly elected directors of
the corporation in accordance with the laws of the State of
Delaware.
IN TESTIMONY WHEREOF, and in compliance with the provisions of Section
312 of the General Corporation Law of the State of Delaware, as amended,
providing for the renewal, extension and restoration of charters,
Robert Gordon, President The last and acting authorized officer
hereunto set his/her hand to this certificate this 23rd day of November
1999.
By: /s/ Robert Gordon
Authorized Officer
Name: Robert Gordon
Print or Type
Title: President
<PAGE> EXHIBIT NUMBER 2.3
STATE OF DELAWARE
CERTIFICATE OF AMENDMENT
OF CERTIFICATE OF INCORPORATION
Digivision International, Ltd., a corporation organized and
existing under and by virtue of the General Corporation Law of the State
of Delaware.
DOES HEREBY CERTIFY: FIRST: That at a meeting of the Board of Directors
of Digivision International, Ltd. resolutions were duly adopted
setting forth a proposed amendment of the Certificate of Incorporation of
said corporation, declaring said amendment to be advisable and calling a
meeting of the stockholders of said corporation for consideration
thereof. The resolution setting forth the proposed amendment is as
follows:
RESOLVED, that the Certificate of Incorporation of this corporation be
amended by changing the Article thereof numbered " First" so that,
as amended, said Article shall be and read as follows: The name of the
corporation is Lifen, Inc.
SECOND: That thereafter, pursuant to resolution of its Board of
Directors, a special meeting of the stockholders of said corporation was
duly called and held upon notice in accordance with Section 222 of the
General Corporation Law of the State of Delaware at which meeting the
necessary number of shares as required by statute were voted in favor of
the amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
FOURTH: That the capital of said corporation shall not be reduced under
or by reason of said amendment.
IN WITNESS WHEREOF, said Digivision International, Ltd. Has
caused this certificate to be signed by Robert Gordon , an Authorized
Officer, this 21st day of June , 2000.
By: /s/ Robert Gordon
Authorized Officer
Title: President
Name: Robert Gordon
Print or Type
(Stamped)
State of Delaware
Secretary of State
Division of Corporations
Filed 03:30 PM 06/22/2000
001318953- 2811491
BYLAWS
Of
DIGIVISION INTERNATIONAL, LTD.
Stockholders
Section 1. Time and Place of Meetings of Stockholders. Unless the time
and place of the annual meeting of stockholders for the purpose of
electing directors and transacting such other business as may be brought
before the meeting are changed by the board of directors, as may be done
from time to time, provided that all legal requirements for such change
and notice to shareholders are observed, such annual meeting of
stockholders of the corporation shall be held at such place as the board
of directors may designate, on the last Monday in November in each year,
if not a legal holiday, and if a legal holiday, then on the next
succeeding Monday which is not a legal holiday, or such later time as may
be designated by the Board of Directors.
Special meetings of the stockholders may be called by the board of
directors to be held at such time and place and for such purpose or
purposes as are specified in such call or by the holders of not less than
one-third of all of the outstanding shares of the capital stock of the
corporation upon the filing with the secretary by such stockholders of a
written application for such meeting stating the time and purpose of
such. The board of directors shall designate the place at which special
meetings of stockholders called by the stockholders shall be held.
Section 2. Notice of Meetings of Stockholders. It shall be the duty of
the secretary to cause notice of each annual or special meeting to be
mailed to all stockholders of record as of the record date as fixed by
the board of directors for the determination of stockholders entitled to
vote at such meeting. Such notice shall indicate briefly the action to be
taken at such meeting and shall be mailed to the stockholders at the
addresses of such stockholders as shown on the books of the corporation
at least 20 days preceding the meeting.
Section 3. Quorum. At any meeting of the stockholders the holders of one-
half of all of the outstanding shares of the stock of the corporation,
present in person or represented by proxy, shall constitute a quorum of
the stockholders for all purposes, unless the representation of a larger
number shall be required by law, and, in that case, the representation of
the number so required shall constitute a quorum. If the holders of the
amount of stock necessary to constitute a quorum shall fail to attend in
person or by proxy at the time and place fixed in accordance with these
bylaws for an annual or special meeting, a majority in interest of the
stockholders present in person or by proxy may adjourn, from time to
time, without notice other than by announcement at the meeting, until
holders of the amount of stock requisite to constitute a quorum shall
attend. At any such adjourned meeting at which a quorum shall be present,
any business may be transacted which might have been transacted at the
meeting as originally notified.
Section 4. Organization. The chair of the board, or in his absence the
vice-chair of the board, or the president, in the order named, shall call
meetings of the stockholders to order, and shall act as chair of such
meeting; provided, however, that the board of directors or executive
committee may appoint any stockholder to act as chair of any meeting in
the absence of the chairman of the board.
The secretary of the corporation shall act as secretary at all meetings
of the stockholders; but in the absence of the secretary at any meeting
of the stockholders the presiding officer may appoint any person to act
as secretary of the meeting.
Section 5. Voting. At each meeting of the stockholders, every stockholder
shall be entitled to vote in person, or by proxy appointed by instrument
in writing, subscribed by such stockholder or by his duly authorized
attorney, and delivered to the inspectors at the meeting; and he shall
have one vote for each share of stock standing registered in his name at
the date fixed by the board of directors pursuant to section 4 of Article
V of these bylaws. The votes for directors, and, upon demand of any
stockholder, or where required by law, the votes upon any question before
the meeting, shall be by ballot.
At least 20 days before each meeting of the stockholders for electing
directors, a full, true and complete list, in alphabetical order, of all
of the stockholders entitled to vote at such election, showing the
address of each stockholder, and indicating the number of shares held by
each, shall be furnished and held open for inspection in such manner, as
is required by law. Only the persons in whose names shares of stock stand
on the books of the corporation at the date fixed by the board of
directors pursuant to section 4 of Article V of these bylaws, as
evidenced in the manner provided by law, shall be entitled to vote in
person or by proxy on the shares so standing in their names.
Prior to any meeting, but subsequent to the date fixed by the board of
directors pursuant to section 4 of Article V of these bylaws, any proxy
may submit his powers of attorney to the secretary, or to the treasurer,
for examination. The certificate of the secretary, or of the treasurer,
as to the regularity of such powers of attorney, and as to the number of
shares held by the persons who severally and respectively executed such
powers of attorney, shall be received as prima facie evidence of quorum
at such meeting and of organizing the same, and for all other purposes.
Section 6. Consent in Lieu of Meetings: Unless otherwise prohibited by
applicable law, any action required to be taken at any annual or special
meeting of the stockholders may be taken without a meeting, without prior
notice and without a vote, if a consent in writing, setting forth the
action so taken, shall be signed by the holders of outstanding stock
having not less than the minimum number of votes that would be necessary
to authorize or take such action at a meeting at which all shares
entitled to vote thereon were present and voted. Prompt notice of the
taking of corporate action without a meeting by less than unanimous
written consent shall be given to those stockholders who have not
consented in writing.
Board of Directors
Section 1. Number and Term of Office. The business and the property of
the corporation shall be managed and controlled by the board of
directors. The directors of the corporation shall be elected annually by
the stockholders and shall hold office until the next annual meeting of
stockholders and until their respective successors are duly elected and
qualified. The number of directors shall be fixed at three (3). In case
of any increase of the number of directors, the additional director or
directors shall be elected by the board of directors or by the
stockholders at an annual or special meeting. Each such additional
director shall serve for the term for which he shall have been elected,
and until his successor shall have been duly chosen.
Section 2. Vacancies. In case of any vacancy in the board of directors
through death, resignation, disqualification or other cause, a successor
to hold office for the unexpired portion of the term of the director
whose place shall be vacant, and until the election of his successor,
shall be elected by a majority of the board of directors then in office,
though less than a quorum, or by the stockholders at an annual or special
meeting.
Section 3. Place of Meetings, etc. The board of directors may hold its
meetings, and may have an office and keep the books of the corporation
(except as otherwise may be provided for by law) in such place or places
in the state of New York or outside of the state of New York, as the
board from time to time may determine.
Section 4. Regular Meetings. Regular meetings of the board of directors
shall be held on the day of the annual meeting of stockholders after the
adjournment of such meeting. No notice shall be required for any such
regular meeting of the board.
Section 5. Special Meetings. Special meetings of the board of directors
shall be held whenever called by direction of the chair or vice-chair of
the board, or the president, or one-third of the directors then in
office. The secretary shall give notice of each special meeting by
mailing the same at least two days before the meeting, or by telegraphing
the same at least one day before the meeting, to each director; but such
notice may be waived by any director. Unless otherwise indicated in the
notice, any and all business may be transacted at a special meeting. At
any meeting at which every director shall be present, even though without
any notice, any business may be transacted.
Section 6. Quorum. Only the total number of directors shall constitute a
quorum for the transaction of business; but if at any meeting of the
board there be less than a quorum present, a majority of those present
may adjourn the meeting from time to time. The affirmative vote of at
least one-half of all the directors then in office shall be necessary for
the passage of any resolution.
Section 7. Consent in Lieu of Meeting. Unless otherwise prohibited by
applicable law, any action required or permitted to be taken at any
meeting of the board of directors, or of any committee thereof, may be
taken without a meeting if all members of the board or committee, as the
case may be, consent thereto in writing, and the writing or writings are
filed with the minutes of proceedings of the board or committee.
Section 8. Conference Telephone. One or more directors may participate
in a meeting of the board, or a committee of the board or of the
stockholders, by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can
hear each other; participation in this manner shall constitute presence
in person at such meeting.
Section 9. Order of Business. At meetings of the board of directors
business shall be transacted in such order as, from time to time, the
board may determine by resolution. At all meetings of the board of
directors, the chair of the board, or in his absence the vice-chair of
the board, or the president, in the order named, shall preside.
Section 10. Compensation of Directors. Each director of the corporation
who is not a salaried officer or employee of the corporation, or of a
parent, subsidiary or affiliate of the corporation, shall receive such
allowances for serving as a director and such fees for attendance at
meetings of the board of directors or the executive committee or any
other committee appointed by the board as the board may from time to time
determine.
Section 11. Election of Officers. At the first regular meeting of the
board of directors in each year (at which a quorum shall be present) held
next after the annual meeting, the board of directors shall proceed to
the election of the principal officers of the corporation.
Officers
Section 1. Officers. The principal officers of the corporation shall be
chosen by the directors and shall be a President, Secretary, and a
Treasurer. The board of directors or any committee or officer designated
by it may appoint such other officers as it or he shall deem necessary,
who shall have such authority and shall perform such duties as from time
to time may be assigned to them by or with the authority of the board of
directors. One person may hold two or more offices, except that the
offices of president and secretary may not be held by the same person.
In its discretion, the board of directors may leave unfilled any office
except those of president, treasurer and secretary.
All officers, agents and employees shall be subject to removal at any
time by the board of directors. All officers, agents and employees, other
than officers elected by the board of directors, shall hold office at the
discretion of the committee or of the officer appointing them.
Each of the salaried officers of the corporation shall devote his entire
time, skill and energy to the business of the corporation, unless the
contrary is expressly consented to by the board of directors or the
executive committee.
Section 2. Powers and Duties of the President. The President shall be the
chief executive officer of the corporation; he shall preside at all
meetings of the stockholders and directors; he shall have general and
active management of the business of the corporation. The president shall
keep the board of directors and the executive committee fully informed
and shall freely consult them concerning the business of the corporation
in his charge. The president may sign and execute all authorized bonds,
contracts, checks or other obligations in the name of the corporation,
and with the treasurer or an assistant treasurer may sign all
certificates of the shares in the capital stock of the corporation. The
president shall do and perform such other duties as from time to time may
be assigned to him by the chairman of the board of directors, the board
itself or the executive committee.
Section 3. Powers and Duties of Treasurer. Subject to the officer
designated by the board of directors, the treasurer shall have custody of
all the funds and securities of the corporation which may have come into
his hands; when necessary or proper he shall endorse, or cause to be
endorsed, on behalf of the corporation, for collection, checks, notes and
other obligations, and shall cause the deposit of same to the credit of
the corporation in such bank or banks or depositary as the board of
directors may designate or as the board of directors by resolution may
authorize; he shall sign all receipts and vouchers for payments made to
the corporation other than routine receipts and vouchers, the signing of
which he may delegate; he shall sign all checks made by the corporation;
provided, however, that the board of directors may authorize and
prescribe by resolution the manner in which checks drawn on banks or
depositaries shall be signed, including the use of facsimile signatures,
and the manner in which officers, agents or employees shall be authorized
to sign; unless otherwise provided by resolution of the board of
directors, he shall sign with an officer-director all bills of exchange
and promissory notes of the corporation; he may sign with the president
or a vice-president all certificates of shares in the capital stock;
whenever required by the board of directors, he shall render a statement
of his cash account; he shall enter regularly, in books of the
corporation to be kept by him for the purpose, full and accurate account
of all moneys received and paid by him on account of the corporation; he
shall, at all reasonable times, exhibit his books and accounts to any
director of the corporation upon application at his office during
business hours; and he shall perform all acts incident to the position of
treasurer. The treasurer need not give any bond for the faithful
discharge of his duties unless so directed by the board of directors.
Section 4. Powers and Duties of Secretary. The secretary shall keep the
minutes of all meetings of the board of directors, and the minutes of all
meetings of the stockholders, and also (unless otherwise directed by the
board of directors) the minutes of all committees, in books provided for
that purpose; he shall attend to the giving and serving of all notices of
the corporation; he may sign with an officer-director or any other duly
authorized person, in the name of the corporation, all contracts
authorized by the board of directors or by the executive committee, and,
when so ordered by the board of directors or the executive committee, he
shall affix the seal of the corporation to such; he shall have charge of
the certificate books, transfer books and stock ledgers, and such other
books and papers as the board of directors or the executive committee may
direct, all of which shall, at all reasonable times, be open to the
examination of any director, upon application at the secretary's office
during business hours; and he shall in general perform all the duties
incident to the office of secretary, subject to the control of the
chairman of the board of directors, the board itself and the executive
committee.
Section 5. Voting upon Stocks. Unless otherwise ordered by the board of
directors or by the executive committee, any officer-director or any
person or persons appointed in writing by any of them, shall have full
power and authority in behalf of the corporation to attend and to act and
to vote at any meetings of stockholders of any corporation in which the
corporation may hold stock, and at any such meeting shall possess and may
exercise any and all the rights and powers incident to the ownership of
such stock, and which, as the owner, the corporation might have possessed
and exercised if present. The board of directors or the executive
committee, by resolution, from time to time, may confer like powers upon
any other person or persons.
Stock Certificates-Dividends-Etc.
Section 1. Certificates of Shares. The certificates for shares of the
stock of the corporation shall be in such form, not inconsistent with the
certificate of incorporation, as shall be prepared or be approved by the
board of directors. No certificate shall be valid unless it is signed by
the president or a vice-president, and either the treasurer or an
assistant treasurer, or the secretary or an assistant secretary, but
where such certificate is signed by a registrar other than the
corporation or its employee the signatures of any such president, vice-
president, treasurer, assistant treasurer, secretary or assistant
secretary and, where authorized by resolution of the board of directors,
any transfer agent may be facsimiles. In case any such president, vice-
president, treasurer, assistant treasurer, secretary, assistant secretary
or transfer agent of the corporation who shall have signed, or whose
facsimile signature or signatures shall have been placed upon, any such
certificate shall cease to be such president, vice-president, treasurer,
assistant treasurer, secretary, assistant secretary or transfer agent of
the corporation before such certificate shall have been issued, such
certificate may be issued by the corporation with the same effect as
though the person or persons who signed such certificate, or whose
facsimile signature or signatures shall have been placed thereupon, were
such president, vice-president, treasurer, assistant treasurer,
secretary, assistant secretary or transfer agent of the corporation at
the date of issue.
All certificates shall be consecutively numbered. The name of the person
owning the share represented thereby, with the number of such shares and
the date of issue, shall be entered on the corporation's books.
All certificates surrendered to the corporation shall be canceled, and no
new certificate shall be issued until the former certificate for the same
number of shares of the same class shall have been surrendered and
canceled, except in accordance with procedures established by the board
of directors or where required by law.
Section 2. Transfer of Shares. Shares in the stock of the corporation
shall be transferred only on the books of the corporation by the holder
in person, or by his attorney, upon surrender and cancellation of
certificates for a like number of shares.
Section 3. Regulations. The board of directors, and the executive
committee also, shall have power and authority to make all such rules and
regulations as respectively they may deem expedient, concerning the
issue, transfer and registration of certificates for shares of the stock
of the corporation.
The board of directors or the executive committee may appoint one or more
transfer agents or assistant transfer agents and one or more registrars
of transfers, and may require all stock certificates to bear the
signature of a transfer agent or assistant transfer agent and a registrar
of transfers. The board of directors or the executive committee may at
any time terminate the appointment of any transfer agent or any assistant
transfer agent or any registrar of transfers.
Section 4. Fixing Record Date for Determination of Stockholders' Rights.
The board of directors is authorized from time to time to fix in advance
a date, not exceeding 20 days preceding the date of any meeting of
stockholders, or the date for the payment of any dividend, or the date
for the allotment of rights, or the date when any change or conversion or
exchange of capital stock shall go into effect, as a record date for the
determination of the stockholders entitled to notice of, and to vote at,
any such meeting and any adjournment, or entitled to receive payment of
any such dividend, or to any such allotment of rights, or to exercise the
rights in respect of any such change, conversion or exchange of stock,
and in such case such stockholders and only such stockholders as shall be
stockholders of record on the date so fixed shall be entitled to such
notice of, and to vote at, such meeting and any adjournment, or to
receive payment of such dividend, or to receive such allotment of rights,
or to exercise such rights, as the case may be notwithstanding any
transfer of any stock on the books of the corporation after any such
record date fixed as stated.
Section 5. Dividends. Upon their unanimous vote, the board of directors
may from time to time declare such dividends as they shall deem advisable
and proper, subject to such restrictions as may be imposed by law.
Section 6. Facsimile Signatures. In addition to the provisions for the
use of facsimile signatures elsewhere specifically authorized in these
bylaws, facsimile signatures of any officer or officers of this
corporation may be used whenever and as authorized by the board of
directors or the executive committee.
Section 7. Corporate Seal. The board of directors shall provide a
suitable seal, containing the name of the corporation, which seal shall
be in charge of the secretary. If and when so directed by the board of
directors or by the executive committee, duplicates of the seal may be
kept and be used by the treasurer or by any assistant secretary or
assistant treasurer.
Miscellaneous Provisions
Section 1. Fiscal Year. The fiscal year shall begin on the first day of
January of each year.
Section 2. Waiver of Notice. Whenever any written notice is required by
statute, or by the certificate or bylaws of this corporation, a waiver
thereof in writing, signed by the person or persons entitled to such
notice, whether before or after the time stated therein, shall be deemed
equivalent to the giving of such notice. Except in the case of a special
meeting of the stockholders, neither the business to be transacted at nor
the purpose of the meeting need be specified in the waiver of notice of
such meeting. Attendance of a person, either in person or by proxy, at
any meeting, except where a person attends a meeting for the express
purpose of objecting to the transaction of any business because the
meeting was not lawfully called or convened.
Section 3. Amendments. The board of directors shall have power to adopt,
amend and repeal the bylaws at any regular or special meeting of the
board, provided that notice of intention to adopt, amend or repeal the
bylaws in whole or in part shall have been included in the notice of
meeting; or, without any such notice, by a vote of two-thirds of the
directors then in office.
Section 4. Vacancies. Any vacancies occurring in any office of the
corporation by death, resignation, removal or otherwise, shall be filled
by the Board of Directors.
Section 5. Resignations. Any director of other officer may resign at
anytime, such resignation to be I writing, and to take effect from the
time of its receipt by the corporation, unless some time be fixed in the
resignation and then from that date. The acceptance of a resignation
shall not be required to make it effective.
Section 6. Corporate Records. Any stockholder of record, in person or
by attorney or other agent, shall upon written demand under oath stating
the purpose thereof, have the right during the usual hours for business
to inspect for any proper purpose the corporation's stock ledger, a list
of its stockholder, and its other books and records, and to make copies
or extracts therefrom. A proper purpose shall mean a purpose reasonably
related to such person's interest as a stockholder. In every instance
where an attorney or other agent shall be the person who seeks the right
to inspection, the demand under oath shall be accompanied by a power of
attorney or such other writing which authorizes the attorney or other
agent to so act on behalf of the stockholder. The demand under oath shall
be directed to the corporation at its registered office in this state or
at its principal place of business.
Section 7. Annual Statement. The President and Board of Directors shall
present at each annual meeting a full and complete statement of the
business affairs of the corporation for the preceding year. Such
statement shall be prepared and presented in whatever manner the Board of
Directors shall deem advisable and need not be verified by a certified
public accountant.
Liability of Officers and Directors
No officer or director shall be personally liable to the corporation or
its stockholders for monetary damages for any breach of fiduciary duty by
such person as an officer or director, except (i) for breach of the
directors duty of loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of the law, (iii) pursuant to Section
174 of the Delaware General Corporation Law, or (iv) for any transaction
from which the officer or director derived an improper personal benefit.
No amendment or repeal of this Article shall apply to or have any effect
on the liability or alleged liability of any officer or director of the
corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal. The Company shall indemnify
its officers and directors against any liability in their capacity as
such to the full extent provided by the Laws of the State of Delaware.
