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U.S. Securities and Exchange Commission
Washington, D.C.20549
FORM 10-SB
(Third Amended)
GENERAL FORM FOR REGISTRATION OF SECURITIES OF
SMALL BUSINESS ISSUERS
Under Section 12(b) or (g) of the Securities Exchange Act of 1934
I3DX.COM, A NEVADA CORPORATION
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(Previously 3-Dx.com)
NEVADA 88-0429263
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization)
4850 RIVER GREEN PARKWAY, DULUTH, GEORGIA 30096
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(Address of principal executive offices) (zip code)
(770) 497-0727
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Issuer's telephone number
Securities to be registered under Section 12(g) of the Act:
Title of each class to be so Name of each exchange on which
registered: Class "A" Common Stock each class is to be registered: None
Class "B" Common Stock
Securities to be registered under Section 12(g) of the Act:
90 million Shares of Class "A" Common Shares and 10 million Class "B" Common
Shares, par value $0.01 (one cent) per share
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(Title of Class)
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I3DX.COM
PART I
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FORM 10-SB ITEM LOCATION IN
ITEM NUMBER CAPTION INFORMATION STATEMENT
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1. Description of Business 3
2. Management's Discussion And 7
Analysis or Plan of Operation
3. Description of Property 11
4. Security Ownership of Certain 11
Beneficial Owners and Management
5. Directors, Executive Officers, 14
Promoters and Control Persons
6. Executive Compensation 17
7. Certain Relationships and Related 18
Transactions
8. Description of Securities 19
PART II
1. Market Price and Dividends on 19
the Registrant's Common Equity
and Other Shareholder Matters
2. Legal Proceedings 20
3. Changes in and Disagreements 21
With Accountants
4. Recent Sales of Unregistered 21
Securities
5. Indemnification of Directors 21
and Officers
PART III
1. Index to Exhibits 22
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ITEM 1. DESCRIPTION OF BUSINESS.
INCEPTION. i3Dx.com (the "Company" or "i3Dx") was incorporated under
the laws of the State of Nevada on June 18, 1999 as 3-Dx.com, with its name
changed to i3Dx.com as of August 16, 1999. The company is the exclusive
licensee, manufacturer, processor and marketing entity for patented 3d
technology, allowing viewers to see images in three (3), rather than two (2),
dimensions. The images may be viewed either as prints or transparencies. The
images are made by layering the print material with micro-lenses. The
micro-lenses add depth, enabling the viewer to see 3d images without the use of
glasses or other visual aides.
i3Dx.com has obtained the rights to the technology developed by its
licensor, NimsTec Limited. i3Dx.com has started operations, but has minimal
revenues and its losses have exceeded its sales. The auditor's report, covering
one month of operations in July of 1999, states "The company has incurred
operating losses from its inception through July 31, 1999. It has not
established revenues sufficient to cover its operating costs, which raises
substantial doubt about its ability to continue as a going concern." The Company
has acquired funding through private placement as demonstrated at Section 1,
Item 4 (See Table). Management believes the infusion demonstrated there
indicates a positive cash flow, countering the stated doubts as to the company's
ability to continue as a going concern.
The company is currently in its early production stage, offering the
following products:
- Production of 3d photographic images which may be viewed comfortably
and conveniently by individuals and groups without the use of glasses
or other visual aids;
- Production of 3d lithographic images which may be viewed comfortably
and conveniently by individuals and groups without the use of glasses
or other visual aids;
- 3D images transmitted via computers and the internet.
i3dx.com's 3d products are available in a wide range of sizes and
formats. these products are readily available for many applications, from
amateur photography to medical ct scan models. Products include 3d sports cards,
3d telephone debit cards and large poster size 3d point-of-purchase displays for
commercial advertising. Display images may be ordered transparent and lit from
behind, known as "Back-Lit Transparencies". The company's clinically accurate 3D
images are use, for example, by eye surgeons.
Images produced by a camera, photographic images, are transformed by
the company during the printing process, so that the resulting image appears to
represent the original scene but includes depth, as well as width and height.
Previous attempts at printing 3d images contained considerably less information
than normally seen by the naked eye viewing the original scene. The i3dx system
provides more information than perceived by the human eye viewing the original
image.
For the purposes of this registration statement, the i3dx.com licensed
processes are generically referred to as "3D" imaging or technology.
i3dx.com is currently a privately held corporation with its majority
shareholder being, NimsTec limited, a privately held bermuda corporation. The
company's ceo, Dr. Jerry C. Nims, is a principal in NimsTec limited. For more
detail on ownership, see item 4 herein.
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PRODUCT AND TECHNOLOGY. i3Dx is a hi-tech company which primarily
utilizes the Internet for the development and distribution of its 3D products.
The Company's technology is based on three-dimensional imaging suitable for
applications such as medical imaging, advertising and marketing.
The Company mass-produces 3D images, in both reflective print and
transparency formats, for the following markets:
- Commercial
- Medical
- Consumer
The Company currently produces 3D images from:
- single 2D source images (prints, negatives, or slides)
- single 2D digital datasets (electronic files)
- multiple 2D images and datasets
- customer 3D digital datasets
- 3D digital datasets created by the Company's computer software
for the customer.
The majority of the Company's commercial source images are digital
image files; that is, computer files containing images that have been scanned
into a computer or created on a computer for transmission or manipulation
purposes. These digital files are received electronically via the Internet. The
Company's ability to transmit 3D data files via the Internet provides the
opportunity for interactive participation with the client. This interaction also
facilitates real time creation and editing of the 3D image to be produced and
substantially reduces time from concept to market.
The Company's primary intended business applications for its
three-dimensional photographic technology include:
- THE COMMERCIAL MARKET - Includes producing of transparencies and
reflective prints for advertising in various public and retail outlets,
and assisting clients in preparing personal identification cards or
documents through the use of the 3D imaging technology.
- THE MEDICAL MARKET - i3Dx's precision photographic optical film is
utilized to communicate detailed spatial relationships and depth cues
for medical diagnoses. A specific
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application is 3D Fundus Photography utilized in diagnosing patients in
approximately 50 medical institutions.
- THE CONSUMER MARKET - Primarily involves the sale and marketing of
cameras, for use by the amateur photographer, which are capable of
taking pictures which, when developed by the Company using its
processes and materials, have a three-dimensional effect. Other
consumer products range from 3D greeting cards to 3D original art which
the Company creates in-house.
While the commercial market images are typically created digitally
using computer software, the medical market typically involves multiple images
taken using special cameras or other equipment. The consumer market primarily
involves 3D images taken using special multi-lens cameras.
Since its inception in June, 1999, the Company has been processing
medical images and consumer market orders. The Company has recently created a
website at "www.i3Dx.com" and is currently receiving orders for its products as
well as the 2D source image files and 3D electronic image datasets required for
its commercial market imaging process.
Because of the organizational nature of the Company's business, it must
be considered a high-risk investment which does not yet have any significant
revenues or any income.
OWNERSHIP AND RELATED PARTY TRANSACTIONS. The shares of i3Dx are
substantially owned by NimsTec Limited, which is also the licensor of technology
to the Company. Its principal shareholders are:
- Dr. Jerry Nims 38%
- L'Ami Foundation 24%
As a practical matter, NimsTec limited should be considered as a
controlling entity to the company and its principal, Dr. Jerry Nims, may
encounter conflicts of interest in his position as an officer/director in
NimsTec and i3Dx. See section on related party transactions and relationships.
Since formation the Company has received interim financing from
Electric & Gas Technology, Inc. and other parties in the aggregate amount of
$2,105,000 as subsequently discussed.
LICENSE AGREEMENT. The Company entered into an exclusive licensing
contract for the technology with NimsTec Limited as of June 30, 1999 covering
the territory of The United States, Canada, and Mexico. In consideration, the
Company is obligated to pay to NimsTec five per cent (5%) of all gross sales in
exchange for a fifty year exclusive license (renewable once on like terms) with
no minimum sales requirements to maintain the license. In October 1999 the
License was expanded to include 3D images printed using sheet-fed lithographic
printing which is designed for lenticular material having a thickness greater
than 11 mils.
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MAJORITY SHARES. NimsTec Limited has acquired thirty million of the
Company's authorized ninety million class "A" shares, as well as all of the 10
million class "B" shares in consideration for the transfer of certain equipment
and other assets to the Company.
FUTURE FOREIGN INTEREST. The Company presently intends and has the
right to acquire a currently undesignated minority interest in a Belgian
corporation to be located in Flanders, Belgium. This company will manufacture
the micro-lens print film employed by the Company for NimsTec Limited, the
intended majority shareholder of the to be formed Belgian corporation. The
Belgian company may be an indirect supplier of photographic film and potentially
related supplies utilized by the Company. The Belgian company will become an
affiliate of i3Dx and will have a license to market 3D products in Europe.
Neither i3Dx nor the Belgian company will directly sell to, or buy from, the
other. The Company has designated Sixty-Six Thousand Dollars ($66,000) of the
debenture proceeds received from Electric and Gas Technology, Inc. for the
purchase of the undesignated minority shareholder interest. No other terms of
this intended future transaction have been negotiated.
SUPPLIERS. The Company is fully dependent upon its licensor, NimsTec
Limited, to supply the lenticular print film which the Company uses to produce
3-D images. NimsTec Limited produces the print film from raw materials that are
readily available from a number of suppliers. The Company purchases its supplies
on a month to month basis from NimsTec at a price prescribed by its License
Agreement. The Company has no competitive basis to compare the reasonableness of
the cost of these materials as there are no other available suppliers of this
unique proprietary material.
COMPETITION. While the Company regards the processes and the
specialized film material obtained from NimsTec as a unique proprietary
material, it should be noted that the actual processing of the materials is not
protected by existing patent applications. However, printing is protected by
patents granted and pending. As a result, it may be possible for other companies
to replicate and produce a substantially similar product using a modified and
unprotected processing procedure. Additionally, there are other companies which
produce 3-D imaging using different technology and techniques. While the Company
does not believe that the quality or variety of the competitive processing is
equivalent to the Company's processes, there is substantial competition in this
market sector and the Company does not claim any exclusivity as to the general
3-D imaging product. Moreover, various other companies which are substantially
larger and better capitalized may be able to dominate the markets in which the
Company currently operates. The Company believes the primary competitors in the
3D imaging technology sector include The Kodak Companies. The Company is not
aware of its current market share but believes it to be minimal.
EMPLOYEES. The Company presently has 14 full-time employees and no
part-time employees, exclusive of management. The total gross pay roll for all
employees, exclusive of management, is approximately $338,000 per year. It is
anticipated that employees and employee costs will increase substantially as the
Company moves towards greater anticipated production during fiscal year 2000. No
specific projection of the amount of increase has been determined, but it is
estimated employee/payroll growth will be in the range of 20 per cent to 40 per
cent for the calendar year 2000.
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SEGMENT ANALYSIS. As a development stage start-up Company, management
does not believe that it has sufficient revenues to be able to analyze or
project in any categorical or quantitative matter the relative percentage of
revenues from the three general sectors of the Company's business, i.e.
commercial, medical and consumer. It does appear from the very limited revenues
received to date that the commercial sector will be the largest followed by the
consumer and then the medical markets. It is anticipated that as the Company
files its anticipated periodic reports as a Reporting Company, it will be in a
position to subsequently have sufficient revenue data to analyze and allocate
revenues, costs and other accounting factors by its principal market sectors and
products. Further, to date, the Company does not have any measurable foreign
market share and can not report sales on a foreign versus domestic basis.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The Company advises you that various information included in this
Section, as well as other parts of this Registration Statement, include forward
looking statements. These statements are based on management's beliefs and
assumptions, particularly related to certain projected economic results, and
upon information currently available to management. Forward looking statements
include the information concerning possible or assumed future results of
operations by the Company set forth under such headings as "Dividend Policy,"
and "Management's Discussion and Analysis." Forward looking statements also
include statements in which we use words such as "expect," "anticipate,"
"intend," "plan," "believe," "estimate," or similar expressions indicating an
intended but unknown future result. Each party relying upon this registration
should understand that these constitute merely management's best projections of
future results and should not be relied upon as an assurance or warranty of
future results in any manner.
The Company has processed and shipped product to all of its target
markets: medical, consumer and commercial. However, due to the short period of
time from inception to date, the sales volumes have been limited. As a result,
the Company's Financial Statements, to date, reflect limited revenues without
net earnings.
PLAN OF OPERATION. Since the Company has not had a full year of
operating history as a start-up entity, it is supplying as required under this
report, its plan of operation for the ensuing twelve month period. With regard
to this plan of operation, it should be understood that the Company has received
from Electric and Gas Technology, Inc. a total of $1,000,000 of interim capital;
$500,000 by way of an equity investment and $500,000 by way of a convertible
debenture. The Company has also received $1,105,000 of equity investment from
other private sources. It believes that these funds should be sufficient to meet
its ongoing operating costs, including such matters as rents, utilities,
salaries and other standard costs for approximately a twelve month period. It is
anticipated, though not warranted, that by the end of this projected interim
period, the Company should have sufficient revenues to cover operating costs and
would not be required to seek supplemental capitalization or financing to
provide for interim operations. It is also anticipated that the Company may,
after the next twelve month period, seek additional public financing for
expansion and growth, but which future financing would be unrelated to this
initial operational period and is not warranted.
The Company does not anticipate that it will be able to devote any
significant portion of its initial capital to product research and development
during the interim period and would have to seek subsequent capitalization for
further product research and development. However, the Company is satisfied that
its current technology is adequate for at least the initial operating period of
the next
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twelve months to meet any demands for product as generally outlined in this
Registration Statement.
Other than the participation in the Belgian corporation, which would be
a potential supplier to the Company of film material used in its 3-D processing,
the Company does not have any anticipation or expectation to purchase or expand
plant or equipment during the next twelve months.
As previously discussed, the Company anticipates its present employee
base of 14 employees to increase by a factor of approximately 20-40% over the
next twelve months as anticipated production increases. i3Dx has allowed for and
believes it will have sufficient capital from the interim financing supplied by
Electric and Gas Technology, Inc. to meet the anticipated increase in payroll
from this anticipated employee growth.
The Company plans to launch an Internet-based sports reporting
subsidiary in the next 6 months which will purchase 3D images directly from the
Company and refer potential commercial market customers to the Company.
The Company does not anticipate any other significant changes in
operations or procedures during the next twelve month period.
Notwithstanding the foregoing general projections, the Company is aware
that there are various factors which could adversely affect its anticipated
revenues, gross margins and overhead expenses thereby rendering its anticipated
ability to operate on the interim capital supplied by Electric and Gas
Technology, Inc. and others to date to be insufficient. The Company does not
have any specific secondary plan of financing should the financing supplied by
Electric and Gas Technology, Inc. and others to date prove to be insufficient
until or unless revenues are adequate to meet operating revenues. The Company
may attempt to obtain additional interim financing from Electric and Gas
Technology, Inc. and other initial financing participants, though no commitment
or obligation exists. Alternatively, the Company may seek to complete an interim
additional private placement financing, though no assurance can be given or made
that such financing could be raised. Finally, the Company could seek commercial
loan sources, though it does not have any present line of credit or financing
commitment from any commercial lender.
All of these factors constitute a significant risk factor if the
Company's expenses should exceed those projected for the next twelve months or
if anticipated revenues are not sufficient by the end of such period to cover
the ongoing operating expenses. The ultimate risk is the Company may be forced
to terminate operations should additional financing be required but not be
available. There also exists the possibility that other 3-D technologies or
processes may adversely impact upon the Company's competitive position and
thereby reduce its ability to continue as an ongoing concern. It is believed
that all of these specific factors are generally discussed above and in the
accountants reservation concerning the Company being a "going concern." See
Financial Statements , Note 6.
LIQUIDITY AND CAPITAL RESOURCES. The Company's present liquidity is
almost fully dependent on its initial financing efforts. The Company's initial
capitalization consists of tangible assets valued at $3,178,781 before
depreciation, and current cash reserves from initial capitalization of
$763,009.. For accounting purposes, the fixed assets are valued at their cost
basis, less depreciation. See attached Financial Statements.
The Company owns an exclusive license from NimsTec Limited, for a fifty
year term with a right of renewal and with no volume restrictions, to utilize
the licensed technology to manufacture and market products throughout its
licensed territory of Canada, Mexico and the United States. The Company is
obligated to pay a license fee, in the amount five percent (5%) of the Company's
gross
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sales, for the term of the license. Ancillary to the license is the right of the
Company to non-exclusive use of various 3D equipment of NimsTec Limited during
the license term in consideration of a monthly fee in the amount of $15,000. The
Company currently also purchases its raw materials from NimsTec.
Electric and Gas Technology, Inc. is a small technology company.
Electric and Gas Technology, Inc. has made an initial capital investment in
the Company of One Million Dollars. Five Hundred Thousand Dollars was
invested as of approximately June 30, 1999 for which it received 4,500,000
shares of Class "A" common stock of the Company, and warrants to acquire an
additional 2,500,000 class "A" shares at the exercise price of $4.00 per
share for a twelve month period. If all of the warrants were exercised, of
which there is no assurance, then the Company would receive an additional
gross capitalization of ten million dollars.
Electric and Gas Technology, Inc. has also supplied to i3Dx Five
Hundred Thousand Dollars in the form of a 24 month convertible debenture,
bearing interest at 8% annually, and convertible to i3Dx Class "A" shares at the
conversion rate of $2.00 per share for a 24 month period. This convertible loan
was made to the Company as of approximately October 25, 1999. If converted, the
result would cause a reduction of the debt of the Company in exchange for the
issuance of 250,000 shares of i3Dx stock to Electric and Gas Technology, Inc. at
$2.00 per share. Electric and Gas Technology, Inc. has not converted any of the
warrants to common shares. As noted above under Future Foreign Interest, $66,000
of the proceeds will be applied to purchase a minority interest in a to be
formed Belgian company which will be licensed upon formation to manufacture
material employed by the Company in the 3D process. The debenture is a general
obligation instrument.
Finally, Electric and Gas Technology, Inc. was issued, as of
approximately August 9, 1999, Five Hundred Thousand 24 month warrants
exercisable at $1.00 per share as part of the financing commitment of Electric
and Gas Technology, Inc. to the Company. These warrants are for a 24 month
period; and, if exercised, would raise an additional Five Hundred Thousand
Dollars in capital for the Company. No assurance or guarantee of the exercise of
these warrants can be given.
The Company has also committed to Electric and Gas Technology, Inc.
that it will retire the $500,000 debenture from the first $4,000,000 in warrants
exercised by Electric and Gas Technology, Inc., unless Electric and Gas
Technology, Inc. elects to convert the debenture. Again, no assurance of the
exercise of these warrants can be made. If the warrants are not exercised, the
Company will be carrying a debt obligation of $500,000 to Electric and Gas
Technology, Inc. which can only be paid from anticipated revenues or earnings.
If these earnings do not materialize, the Company may not have any means or
resources from which to pay its outstanding debt obligations and may be forced
into a position of illiquidity.
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Subsequent to the initial filing of the Form 10 on November 12, 1999,
the Company entered into a Private Placement Accredited Investor financing
transaction with a small group of individuals (collectively referred to as the
"Private Placement Group") commencing January 14, 2000, which raised $1,105,000
in interim capital through the selling of its Class "A: common shares of the
Company to these private investors at prices between $0.46 and $0.50 per share.
The Company regarded this interim financing as an "accredited investor"
financing offering which did not require registration or the use of an Offering
Memorandum. Each of the accredited investors were provided with access to all
books and records of the Company, together with a review of the present Form 10
information as a basic information packet. The investors also then completed a
Private Placement Subscription Agreement, a copy of which is attached as Exhibit
H to this Form 10 filing.
The funds as received have been employed by the Company primarily for
continued development and marketing of the 3-D image processes described in this
Registration, as well as with the graphic printing equipment and facilities as
generally described above.
At present members of the Private Placement Group hold a total of
2,290,000 Class "A" common shares constituting 6.2% of the presently issued and
outstanding Class "A" shares of the Company.
RESULTS OF OPERATIONS. As noted above, the Company has very limited
revenues to date. However, the Company has completed its website and is pursuing
its marketing activities as described above.
Management's present projected use of the initial proceeds obtained
from Electric & Gas Technology, Inc., and other third party financing parties
are generally described below. This initial funding should be adequate for the
next twelve months to sustain current operation and anticipated growth in
product marketing. This interim capital of $2,105,000 has been or will be
employed as follows:
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(1) Overhead and operations - $432,177
(2) Belgian affiliate investment - $ 66,000
(3) Salaries - $335,433
(4) Payment of debt and short term obligations - $0
(5) Product advertising and marketing - $0
(6) Plant, facilities, equipment expansion - $323,423
(7) Miscellaneous - $184,958
(8) Working capital reserves - $763,009
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The Company has not short term alternative financing plans or
alternatives if the interim capitalization does not prove adequate until the
Company is capable, if ever, of meeting current operating expenses from earned
revenues.
Y2K DISCLOSURE. From inception in June 1999 to year end the Company
expended approximately One Thousand Dollars ($1,000) to attempt to insure that
its internal computer systems, including critical Internet connections, would
cause the Company's computers to recognize the year 2000 change and continue to
function normally. As of the date of this Amended Report, all of the Company's
internal computer systems appear to be functioning normally and all hardware and
software components are recognizing the year 2000 date. Further, the Company has
not realized any computer related failures in ancillary systems employing
computer components such as telephone systems, faxes or other equipment.
Finally, the Company is receiving orders and transmitting product via the
Internet without interruption.
ITEM 3. DESCRIPTION OF PROPERTY.
The Company owns $3,178,781 of tangible assets and cash of $763,009.
The Company's right to the use of additional production equipment, technology
and facilities under lease or license agreements are described by category
below. The Company's capitalization, as described in the preceding section,
primarily consists of its property and cash. For accounting purposes, the
leaseholds and license rights, including property available for non-exclusive
use under the license with NimsTec, are not valued.
TANGIBLE PRODUCTION EQUIPMENT. In addition to the tangible assets
generally described above, which are used for production, the Company has the
non-exclusive use, under its license, of various other equipment owned by the
licensor. Title to this equipment remains with NimsTec Limited. This equipment
is not included in the Financial Statements for the Company. The Company
believes its owned equipment, plus the NimsTec Limited "use" equipment, to be
sufficient equipment for the initial intended production of the 3D imaging
products.
LEASEHOLDS. The Company presently leases its principal office
facilities at 4850 River Green Parkway, Duluth, Georgia. These premises consist
of administrative and manufacturing area of approximately 26,500 square feet.
The property is held under a seven year lease at a monthly lease rate of
$18,000, with no right of renewal.
ITEM 4. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
i3Dx is currently a privately held corporation with its licensor and
principal shareholder being, NimsTec Limited, a Bermuda Corporation. NimsTec
currently holds Thirty Million shares of an authorized Ninety Million shares
of the Class "A" common stock, constituting 81.5% of the
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issued and outstanding shares, and Ten Million shares of an authorized Ten
Million shares of the Class "B" common stock. It should be noted the Class "B"
common stock represents 51% of the voting shares in the Company. The only other
significant present shareholders are Electric Gas and Technology, Inc. and the
Private Placement Group whose relationship is subsequently explained in this
Registration Statement.
Electric and Gas Technology, Inc. currently holds 4,500,000 shares of
Class "A" common stock of which it intends to distribute Three Million shares to
its shareholders together with two million Warrants out of 2.5 million
exercisable for additional Class "A" common shares to its shareholders at $4.00
per share to acquire one share for each warrant exercised. After the intended
distribution, Electric and Gas Technology, Inc. would continue to directly own
approximately 1.5 Million i3Dx Class "A" common restricted shares and warrants
to acquire an additional 0.5 million shares. In addition, i3Dx has reserved an
additional six million Class "A" shares for warrants or options of which
Electric and Gas Technology, Inc. has received a warrant right under which it
may acquire up to 500,000 shares in a twenty-four month warrant period at $1.00
per share. At present there are no other issued and outstanding shares or
shareholders of the Company.
In the following table, the Company attempts to set out graphically a
summary of those holdings by the principal security holders, including all
warrant and options rights:
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<CAPTION>
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Current Percentage of
Issued Shares /
percentage assuming
Max. No. of Shares all options or
Issued / or to be warrants are
Security Holder Type of Security Issued Exercised
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NimsTec Limited (1) 30,000,000 81.5%
Class "A" Common (issued) -----
74.9%
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NimsTec Limited Class "B" Common 10,000,000 100%
(51% of voting shares) (issued) ----
100%
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Electric and Gas 4,500,000 12.2%
Technology, Inc. (2) Class "A" Common (issued) -----
19.4%
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Private Placement Group Class "A" Common 2,290,000 6.2%
----
5.7%
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(1) NimsTec is a privately held Bermuda corporation whose principal
shareholders are:
- Dr. Jerry Nims 38%
- L'Ami Foundation 24%
(2) Electric and Gas Technology, Inc. is a publicly held Texas Corporation.
Following are the directors and principal officers holding shares,
together with their shareholder percentage. There are no other
shareholders which hold 10% or more of the Electric and Gas Technology,
Inc. stock:
- S. Mort Zimmerman, Director, President and Chairman, 9.7%
- Daniel A. Zimmerman, Director, Vice President, 4.63%
- Edmund Bailey, Director, Vice President, CFO, 0.93%
- Fred M. Updegraff, Director, Vice President, Treasurer, 1.16%
2,500,000 Class "A" Warrants are outstanding to Electric & Gas
Technology, Inc. and exercisable at $4.00/share for twelve months and
were issued on July 3, 1999.
500,000 Class "A" Warrants are outstanding to Electric & Gas
Technology, Inc. and exercisable at $1.00/share for twenty-four months
and were issued on August 9, 1999.
In addition to the above option rights for 3,000,000 shares, Electric &
Gas Technology, Inc. also holds a convertible debenture which if fully
converted would result in an additional 250,000 shares of i3Dx
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common stock being issued to it. If a full conversion occurs and
Electric & Gas Technology exercises all present options it would own
19.4% of the issued shares in the Company.
ITEM 5. DIRECTORS AND EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS.
DIRECTORS AND EXECUTIVE OFFICERS. The following chart sets out a list
of the Directors and Principal Executive Officers. Following the chart is a
brief resume of each of the Directors and Officers.
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Name Title Current Term of Years of Service
Office
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<S> <C> <C> <C>
Dr. Jerry C. Nims Chairman of the 6/18/99 to 6/30/00* From Inception June,
Board, CEO, CTO 1999
------------------------- ----------------------- ---------------------- -----------------------
Paul F. Peters Director, 6/18/99 to 6/30/00* From Inception June,
President, 1999
COO
------------------------- ----------------------- ---------------------- -----------------------
Dr. William Karczes, PhD Research & Development Sr. Vice President, From Nov. 1999
11/1/99 to 6/30/00*
------------------------- ----------------------- ---------------------- -----------------------
James Collins Treasurer, CFO 9/1/99 to 6/30/00* From Sep. 1999
------------------------- ----------------------- ---------------------- -----------------------
</TABLE>
*Unless otherwise replaced at the pleasure of the Board of Directors
The following table sets-out the ownership of the Company's stock by all
principal officers and directors:
14
<PAGE>
<TABLE>
<CAPTION>
------------------------------- ---------------------------- ----------------------------- ----------------------------
Title of Class (1) Name & Address of Amount & Nature of Per Cent of Class
Beneficial Owner Beneficial Owner
------------------------------- ---------------------------- ----------------------------- ----------------------------
<S> <C> <C> <C>
Common Stock NimsTec Limited (1) 30,000,000 "A" 81.5%
10,000,000 "B" 100%
------------------------------- ---------------------------- ----------------------------- ----------------------------
Common Stock Paul F. Peters 0 0%
"4850 River Green Parkway,
Duluth Georgia 30096"
------------------------------- ---------------------------- ----------------------------- ----------------------------
Common Stock Dr. William 0 0%
Karczes, PhD
"4850 River Green Parkway,
Duluth Georgia 30096"
------------------------------- ---------------------------- ----------------------------- ----------------------------
Common Stock James Collins 0 0%
"4850 River Green Parkway,
Duluth Georgia 30096"
------------------------------- ---------------------------- ----------------------------- ----------------------------
</TABLE>
The Company has only one class of stock, Class "A", which will be used
for financing purposes. The Class "B" shares represent an equal ownership per
share, but 51% of the voting control, and will be held exclusively by NimsTec
Limited. Except for the indirect interest of Dr. Nims no officer or director
holds any stock or stock rights in the company.
(1) While Dr. Nims does not directly hold any shares in the Company,
he is an indirect beneficial owner by owning a little more than one-third of
NimsTec Limited.
BIOGRAPHICAL INFORMATION.
Dr. Jerry C. Nims, Age 63. Dr. Nims is the founder of the Company and
acts as its Board Chairman. He is also the Chief Executive Officer and the Chief
Technical Officer. Dr. Nims has been active in the development of 3D technology
over the past 32 years. Dr. Nims obtained his first patent in 3-Dimensional
technology in 1974. From 1970 to 1984 he was involved with Nimslo Technology,
Inc. in the development of various 3D technologies and patents. From 1984 to
1990, he was affiliated with Fairhaven Group of Bermuda. From 1990 to 1995 he
was primarily engaged in interest outside the technology field. From 1996 to
present, he has been a full-time officer of Nimstec Limited. Dr. Nims will
continue to participate with Nimstec Limited as an officer and director. He
will, however, not participate as either an officer or director of the Company
in any
15
<PAGE>
matter which materially effects the contractual relationship between the Company
and NimsTec Limited. It is intended that Dr. Nims will serve the Company on an
as needed basis.
PAUL F. PETERS, Age 36. Mr. Peters will act as President and COO of the
Company. Mr. Peters was formally with the Bank of New England as a Financial/EDP
(Electronic Data Processing) Auditor from approximately 1985-1987. He also has
worked in the investment banking field, including Vice President for Lehman
Brothers International Private Client Group from 1988-1995. Previously, Mr.
Peters was the Director of Business Development for NimsTec Limited from
approximately 1996 through June, 1999. Mr. Peters traveled globally for two
years as Director of Business Development for NimsTec Limited, developing a
five-year plan and business model and negotiating global alliances and
partnerships. It is anticipated that Mr. Peters will serve the Company on a full
time basis.
DR. WILLIAM M. KARCZES, PHD, Age 52. Present: i3Dx, Senior Vice
President, Research & Development and Manufacturing. 1992 to 1999:
President/Consultant, Plastic Associates, Inc. Over 30 years of experience in
all forms of plastic processing. Wide range of employment with various
multinationals including General Electric, Ciba Geigy, and Ameritech. Consulting
clients including American Cyanamid, Polymer Group Inc. (PGI), AT&T, etc. Mr.
Karczes joined the Company in November 1999 and it is expected will serve on a
full time basis.
JAMES COLLINS, Age 52. From 1987 to date Mr. Collins has owned and
operated Collins & Company which provides management accounting services to
various Bermuda based companies, including shipping and real estate interests.
Mr. Collins is a member of the Institute of Chartered Accountants and was a
founding member of the Institute of Chartered Accountants for Bermuda. From 1973
to 1986 he was the treasurer and held other offices in TMX, Ltd., the
international financial and distribution affiliate of Timex Corporation. He held
several directorships within the group. He was also a former director of
accounting services for Peat Marwick Mitchell. Mr. Collins will act as the Chief
Financial Officer and the Treasurer of the Company. It is intended Mr. Collins
will serve the Company on an as needed basis.
KEY ADVISORS
SIR DAVID GIBBONS, Age 72. Sir David currently serves as the CEO of
Edmund Gibbons Ltd. and the Chairman of Colonial Insurance C.O. Ltd. both
privately held Bermuda based corporations. From 1958-1999 Sir David served first
as a Director of the Board of N. T. Butterfield & Sons Ltd. and lastly as the
Chairman (1986-1997). Sir David also has a long history of service in various
positions in the government of the Bermuda last serving as the Chairman of the
Bermuda Monetary Authority (1984-1986) and previously as Finance Minister and a
Member or Parliament. He was awarded the title KBE by her majesty the Queen in
January 1985. Sir David will advise the Company on an as needed basis.
DAVID PERDUE, Age 45. Currently Executive Vice President for Reebok
International Ltd. since 1998 where he was responsible for three of Reebok's
four divisions, including Global Marketing, Global Sales and Global Operations.
Prior to his affiliation with Reebok, Mr. Perdue was Senior Vice President for
Haggar Apparel (1995-1998) and was responsible for global sales and
distributions. From 1993 - 1995 he was the President of Sara Lee Asia. Mr.
Perdue will act as a Director and consultant to the Company starting August,
2000. Mr. Perdue will advise the Company on an as needed basis.
16
<PAGE>
ITEM 6. EXECUTIVE COMPENSATION.
<TABLE>
<CAPTION>
---------------- -------- ------------------------------------ -------------------------------------------- ------------
Name and All other
principal compensation
position Year Annual Compensation Long Term Compensation ($)
------------ ---------- ------------ ------------------------------- ------------
Other Awards Payouts
annual ------------------------------- ------------
Salary Bonus compensation Restricted Securities LTIP
($) ($) ($) stock underlying payouts
award(s) Options/SARs ($)
($) (#)
---------------- -------- ------------ ---------- ------------ -------------- ---------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Paul F. 1999 $60,000 0 0 0 0 0 0
Peters,
President
---------------- -------- ------------ ---------- ------------ -------------- ---------------- ------------ ------------
Dr. Jerry 1999 $60,000 0 0 0 0 0 0
Nims, Chairman
of the Board,
CEO
---------------- -------- ------------ ---------- ------------ -------------- ---------------- ------------ ------------
</TABLE>
None of the current or prospective officers have been granted any
options, warrants or 401K or other stock rights in the Company. Further, the
Company does not presently have any established pension, stock option, or stock
incentive or related type plans.
Salaries have been paid to Messrs. Nims and Peters since July, 1999. No
Salaries have been fixed for the other officers who will initially serve on a
part-time basis.
Dr. Nims, while not directly holding shares in the Company, is a minority
owner (a little more than one-third) in the licensor of the Company, NimsTec
Limited, a Bermuda Corporation, which currently owns approximately 81.5% of the
issued and outstanding Class "A" common stock of the Company and 100% of the
Class "B" common stock (representing 51% of the voting rights in the
17
<PAGE>
Company). As a result, it should be deemed that Dr. Nims is an indirect
beneficial owner of the shares set-out in the foregoing table.
ITEM 7. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
As generally described under Item 1 "Description of Business" and Item
4 "Beneficial Ownership of Stock", there are deemed to be two affiliated
entities which may have a material influence or relationship with the Company's
operations.
- NimsTec Limited currently holds 81.5% of all class "A" shares of the
Company and 100% of the class "B" shares. The class "B" shares represent
51% of the voting shares. Even if all present options and warrants
outstanding were exercised and the convertible debentures were converted
to class "A" shares by Electric and Gas Technology, Inc., NimsTec would
continue to hold 74.9% of the class "A" shares and all of the class "B"
shares. As a result, NimsTec is in control of the Company and will remain
in control for the foreseeable future. Dr. Jerry C. Nims who is a
principal officer in i3Dx is also an officer in NimsTec Limited and holds
approximately one-third (1/3) of the shares in that entity. Accordingly,
Dr. Nims must be considered to be in a position to exercise a strong
influence over the Company.
- Electric and Gas Technology, Inc. presently owns 12.2% of the class "A"
shares and has option and conversion rights to acquire an additional 7.2%
As a result, Electric and Gas Technology, Inc. must be considered to have
significant influence in the Company.
- NimsTec Limited, as previously described, acts as a licensor for the
Company for all of its technological rights. NimsTec also has a
relationship to supply the processing film and materials to the Company.
It is doubtful the Company could continue in its intended operations in
any manner without the license rights granted and equipment provided by
NimsTec under the licensing agreement as generally described above. The
Chairman of the Board of the Company, Dr. Nims, continues to act as a
manager within NimsTec Limited. The fact that Dr. Nims is a minority
interest owner in NimsTec, as well as the Chairman of the Board of the
Company, may create certain potential conflicts of interest.
Specifically, it is noted that Dr. Nims has positions with a beneficial
ownership interest in the Company and in NimsTec Limited, as well as the
resulting beneficial ownership of the NimsTec Limited interest in the
Company. The Company believes that is has provided adequate safeguards
against these potential conflicts by adopting a protocol. Under the
protocol, Dr. Nims will continue to participate in NimsTec Limited. He
will not, however, participate, as either an Officer or Director of i3Dx,
in any matter which materially effects any contractual relationship
between the Company and NimsTec Limited. It is noted that the primary
contractual relationship between these two entities is already specified
and governed by the June 30, 1999 Asset and License Purchase Agreement.
It is not anticipated that the Company will be involved with NimsTec
Limited in any material dealings outside of the terms of said Agreement.
Nonetheless, because of the predominant shareholder interest of NimsTec
Limited in the Company, it should be deemed that NimsTec may be in a
position to substantially control the direction of the Company.
- Electric and Gas Technology, Inc. should be considered as an affiliated
company, as it has supplied interim capital financing to the Company and
will be engaged with the Company in a "spin-off" of various shares of
i3Dx to Electric and Gas Technology, Inc. shareholders as part of a
18
<PAGE>
contemporaneously filed registration statement. While Electric and Gas
Technology, Inc. does not have a position on the Board of Directors or
any management authority or rights in the Company, it does hold in
excess of ten per cent of the issued and outstanding shares of the
Company at the present time and by such shareholder position should
be considered a control or affiliated party.
- To the best knowledge of the Company, there are no other affiliated
persons or related party contractual relationships other than described
in this section and more fully set-out in other parts of this
Registration Statement.
ITEM 8. DESCRIPTION OF SECURITIES.
The Company has two classes of common stock. A Class "A" common stock
consisting of 90 million shares, authorized at $0.01 par value and 10 million
Class "B" common shares having a $0.01 par value. Currently there is no public
trading market for either class of these securities. The Company has no
preferred or other classes of shares.
The Class "B" voting shares constitute 51% of the voting rights in the
Company and are all issued and held by NimsTec Limited as previously described.
Of the 90 million authorized Class "A" common shares, presently 36,790,000shares
are issued and an additional 3,250,000 shares are subject to be issued pursuant
to various debenture conversion rights or warrants. The aggregate of the Class
"A" shares hold 49% of the voting rights in the Company.
The Class "B" shares would be entitled to 51% of any stock dividend and
the Class "A" shares entitlement would be 49%.
There are no preemptive rights or cumulative voting provisions in the
Company. At present, the Company pays no dividends and it does not anticipate in
the foreseeable future that there will be any dividends paid.
No fully issued and subscribed share subject to redemption, assessment,
or call.
The only debt securities of the Company is a Convertible Debenture to
Electric & Gas Technologies, Inc. which is convertible to 250,000 class "A"
shares as generally described under the Management's Discussion and Analysis.
A total of 3,000,000 warrants for 3,000,000 Class "A" common shares are
outstanding and held by Electric & Gas Technologies, Inc. No assurance of
whether the debenture will be converted or the warrants exercised can be made
or given at this time.
PART II
ITEM 1. MARKET PRICE AND DIVIDENDS ON REGISTRANT'S COMMON EQUITY & OTHER
SHAREHOLDER MATTERS.
The Company does not have a price range for its securities, as it has not
issued any publicly traded stock to date. It is not anticipated that there can
be any public trading in the Company's stock until after the filing and
effectiveness of this registration statement, potential Rule 144 sales by
current holders of their restricted stock, or the Company completes a
registration of its stock.
19
<PAGE>
At present the Company has a total of 3,250,000 shares subject to all
unexercised options, warrants or other stock rights as previously described. If
exercised, the resulting shares would constitute 8.1% of the presently issued
and outstanding shares. It is anticipated these shares would be eligible for
sale under Rule 144 approximately one year after being issued and presuming the
Company has current public information available.
The Company currently has approximately 36,790,000 issued shares
available for sale under Rule 144, if the company were to complete this
registration and have adequate current public information so that sales could be
completed under Rule 144.
The Company also has an undertaking with Electric & Gas Technology, Inc.
to attempt to register Three Million of its shares issued earlier to Electric &
Gas Technology to be distributed to Electrical Gas Technology shareholders. No
date for this registration has been prescribed, nor can it be presently
determined. The Company has no other present registration plans or obligations.
No broker/dealers or others acting as potential market makers have made
any commitment to maintain or to initiate a trading market in the Company's
stock. The Company's longer terms objective would be to attempt to meet, as soon
as possible, the listing requirements for NASDAQ "small cap" status and be
traded on that market, though no assurance or warranty whether or when such
qualification will be met, can be given.
The Company does not presently pay any dividends and does not anticipate
paying dividends for the foreseeable future. Currently the Company has no
earnings from which to pay dividends and any future earnings are anticipated to
be reinvested. The Company intends to retain all earnings for growth purposes.
The Company was only recently organized, in June, 1999, and has not had any
formal shareholder meetings since such organization. The Company presently
anticipates holding its first annual shareholders' meeting in late calendar year
2000, though no specific date has been set by the Board of Directors at this
time. To the best knowledge of the Company, there are no pending shareholder
matters or proposed items to be included in any special or general meeting of
shareholders, nor has any such meeting been requested.
ITEM 2. LEGAL PROCEEDINGS.
The Company is not aware of any legal proceedings to which the Company is
a party, nor is the Company aware of any present demands, claims or causes of
actions pending against the Company.
20
<PAGE>
ITEM 3. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS.
The Company has retained the independent auditing firm of Jones, Jensen &
Company of Salt Lake City, Utah to act as its independent auditors. The Company
has no present disagreement with the initial audit material prepared by its
independent auditors and attached to this filing. The Company has no present
plans to change its auditors and would seek ratification of the continuing
services of its present auditors at the next regular shareholder meeting.
ITEM 4. RECENT SALES OF UNREGISTERED SECURITIES.
The Company has detailed under Part I of this registration, all of its
initial private placement of shares.
The following purports to set-out in tabular format additional required
information as to all shares of the Company issued to date. The table does not
include options or other stock rights previously disclosed:
<TABLE>
<CAPTION>
------------------------------- ---------------------------- ----------------------------- ---------------------------
Name of Shareholder Total Shares Issued Percentage of Current Issued Exemption Claim
------------------------------- ---------------------------- ----------------------------- ---------------------------
<S> <C> <C> <C>
NimsTec Ltd. 30,000,000 Class A 81.5% Accredited Investor
10,000,000 Class B ---- pursuant to 4(6)
100% Securities Act
------------------------------- ---------------------------- ----------------------------- ---------------------------
Electric & Gas Technology Inc. Class A 12.2% Accredited Investor
4(6) Act
------------------------------- ---------------------------- ----------------------------- ---------------------------
Private Placement Group Class A 6.2% Accredited Investor 4(6)
Act
------------------------------- ---------------------------- ----------------------------- ---------------------------
</TABLE>
All of the foregoing placements were deemed completed as accredited investor
sales pursuant to the exemptions provided by Section 4(6) of the Securities Act
of 1933, and/or Rule 506 promulgated pursuant to such Act.
ITEM 5. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company has adopted the standard indemnification provisions for
officers and directors as provided by Nevada law in its Articles, which the
Company generally indemnifies officers and directors from liability for good
faith errors or omissions committed in the ordinary discharge of their duties.
The Company is generally aware that it is the position of the SEC that any claim
of indemnification as may relate to violations of U.S. Securities laws and
regulations are deemed to be of no force, effect or application.
21
<PAGE>
PART III
ITEM 1. INDEX TO EXHIBITS.
The Company attaches the following material exhibits to this registration
statement:
<TABLE>
<CAPTION>
I. Audited Financial Statements for periods ending June 30, 1999,
July 31, 1999, unaudited Financial Statements for period ending
December 31, 1999 and April 15, 2000.
Regulation
II. Other Exhibits: S-K Designation
Number:
<S> <C>
A. Share Acquisition Agreement by Electric and Gas Technology, Inc. (2)
entitled Plan of Reorganization and Financing Agreement with Addendum.
B. Articles of Incorporation and all amendments thereto. 3(I)
C. By-Laws. 3(ii)
D. Debenture and Security instrument between Electric and Gas Technology, Inc. and i3Dx. (4)
E. Opinion re legality (5)
F. Asset and License Purchase Agreement between NimsTec Limited (10)
and the Company with Amendment.
[Application for Confidential Filing Pending]
G. Financial Data Schedule (27)
H. Private Placement Subscription Agreement
</TABLE>
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized.
Registrant:
i3Dx.com
/s/ Paul F. Peters
Date: July 3, 2000
Paul F. Peters
Its President
22
<PAGE>
I3DX.COM
(FORMERLY 3-DX.COM)
(A DEVELOPMENT STAGE COMPANY)
FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND JUNE 30, 1999
<PAGE>
C O N T E N T S
<TABLE>
<CAPTION>
<S> <C>
Independent Auditors' Report .............................................. 3
Balance Sheets ............................................................ 4
Statements of Operations .................................................. 6
Statements of Stockholders' Equity ........................................ 7
Statements of Cash Flows .................................................. 8
Notes to the Financial Statements ......................................... 10
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
i3Dx.com
(Formerly 3-Dx.com)
(A Development Stage Company)
Duluth, Georgia
We have audited the accompanying balance sheet of i3Dx.com (formerly 3-Dx.com)
(a Nevada corporation) (a development stage company) as of June 30, 1999 and the
related statements of operations, stockholders' equity and cash flows from
inception on June 18, 1999 through June 30, 1999. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of i3Dx.com (formerly 3-Dx.com) (a
Nevada corporation) (a development stage company) as of June 30, 1999 and the
results of its operations and its cash flows from inception on June 18, 1999
through June 30, 1999 in conformity with generally accepted accounting
principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 to the
financial statements, the Company has suffered losses from operations since
inception, which raises substantial doubt about its ability to continue as a
going concern. Management's plans in regard to these matters are also described
in Note 6. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
Jones, Jensen & Company
Salt Lake City, Utah
September 20, 1999
3
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Balance Sheets
ASSETS
<TABLE>
<CAPTION>
December 31, June 30,
1999 1999
----------- -----------
(Unaudited) (Audited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 158,789 $ --
Accounts receivable, net (Note 1) 15,363 --
Prepaids 79,333 --
Inventory (Note 1) 57,504 --
----------- ----------
Total Current Assets 310,989 --
----------- ----------
FIXED ASSETS (Note 1)
Machinery and equipment 3,182,161 3,166,700
Less accumulated depreciation (158,334) --
----------- ----------
Total Fixed Assets 3,023,827 3,166,700
----------- ----------
OTHER ASSETS
License rights, net (Note 5) 393,333 --
Deposits 18,000 --
----------- ----------
Total Other Assets 411,333 --
----------- ----------
TOTAL ASSETS $ 3,746,149 $3,166,700
=========== ==========
</TABLE>
4
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
December 31, June 30,
1999 1999
----------- -----------
(Unaudited) (Audited)
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 118,227 $ --
Accrued expenses 247 --
----------- -----------
Total Current Liabilities 118,474 --
----------- -----------
LONG-TERM LIABILITIES
Convertible debenture (Note 7) 500,000 --
----------- -----------
Total Long-Term Liabilities 500,000 --
----------- -----------
Total Liabilities 618,474 --
----------- -----------
COMMITMENTS AND CONTINGENCIES (Note 4)
STOCKHOLDERS' EQUITY (Note 2)
Common stock, class A; 90,000,000 shares
authorized of $0.01 par value, 34,500,000
shares issued and outstanding 345,000 345,000
Common stock, class B; 10,000,000 shares
authorized of $0.01 par value, 10,000,000
shares issued and outstanding 100,000 100,000
Additional paid-in capital 3,221,700 3,221,700
Stock subscription receivable -- (500,000)
Accumulated deficit (539,025) --
----------- -----------
Total Stockholders' Equity 3,127,675 3,166,700
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ 3,746,149 $ 3,166,700
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Statements of Operations
<TABLE>
<CAPTION>
From
For the Inception on
Six Months June 18,
Ended 1999 Through
December 31, June 30, December 31,
1999 1999 1999
----------- --------- ------------
(Unaudited) (Audited) (Unaudited)
<S> <C> <C> <C>
NET SALES $ 200,465 $ -- $ 200,465
COST OF GOODS SOLD 58,883 -- 58,883
---------- --------- ------------
GROSS MARGIN 141,582 -- 141,582
---------- --------- ------------
OPERATING EXPENSES
General and administrative 195,642 -- 195,642
Rent 108,000 -- 108,000
Amortization 6,667 -- 6,667
Depreciation 158,334 -- 158,334
Salaries and wages 194,008 -- 194,008
---------- --------- ------------
Total Operating Expenses 662,651 -- 662,651
---------- --------- ------------
OPERATING LOSS (521,069) -- (521,069)
---------- --------- ------------
OTHER INCOME (EXPENSE)
Other expenses (15,709) -- (15,709)
Interest expense (6,667) -- (6,667)
Interest income 4,420 -- 4,420
---------- --------- ------------
Total Other Income (Expense) (17,956) -- (17,956)
---------- --------- ------------
LOSS BEFORE INCOME TAXES (539,025) -- (539,025)
INCOME TAXES -- -- --
---------- --------- ------------
NET LOSS $ (539,025) $ -- $ (539,025)
========== ========= ============
BASIC LOSS PER COMMON SHARE $ (0.02) $ 0.00
========== =========
FULLY DILUTED LOSS PER
COMMON SHARE $ (0.02) $ 0.00
========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Statements of Stockholders' Equity
<TABLE>
<CAPTION>
Common Common
Class A Stock Class B Stock Additional
------------------------ --------------------------------------- Paid-In
Deficit Shares Amount Shares Amount Capital Receivable
----------------------- ---------- --------- ---------- --------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Balance at inception on
June 18, 1999 (audited) -- $ -- -- $ -- $ -- $ --
Common stock issued for
machinery valued at
approximately $0.08
per share (audited) 30,000,000 300,000 10,000,000 100,000 2,766,700 --
Common stock subscribed
for at approximately
$0.11 per share (audited) 4,500,000 45,000 -- -- 455,000 (500,000)
Net loss from inception on
June 18, 1999 through
June 30, 1999 (audited) -- -- -- -- -- --
---------- -------- ---------- -------- ---------- ---------
Balance, June 30, 1999
(audited) 34,500,000 345,000 10,000,000 100,000 3,221,700 (500,000)
Cash received on stock
subscription receivable
(audited) -- -- -- -- -- 500,000
Net loss for the six months
ended December 31, 1999
(unaudited) -- -- -- -- -- (539,025)
---------- -------- ---------- -------- ---------- ---------
Balance, December 31, 1999
(unaudited) 34,500,000 $345,000 10,000,000 $100,000 $3,221,700 $(539,025)
========== ======== ========== ======== ========== =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Statements of Cash Flows
<TABLE>
<CAPTION>
From
For the Inception on
Six Months June 18,
Ended 1999 Through
December 31, June 30, December 31,
1999 1999 1999
----------- -------- -----------
(Unaudited) (Audited) (Unaudited)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (539,025) $ -- $ (539,025)
Adjustments to reconcile net loss to net cash
used by operating activities:
Depreciation 158,334 -- 158,334
Amortization 6,667 -- 6,667
Bad debts 809 -- 809
Changes in operating assets and liabilities:
Increase in accounts receivable (16,172) -- (16,172)
Increase in prepaids (79,333) -- (79,333)
Increase in inventory (57,504) -- (57,504)
Increase in deposits (18,000) -- (18,000)
Increase in accounts payable 118,227 -- 118,227
Increase in accrued expenses 247 -- 247
----------- -------- -----------
Net Cash Used by Operating Activities (425,750) -- (425,750)
----------- -------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of license rights (400,000) -- (400,000)
Purchase of fixed assets (15,461) -- (15,461)
----------- -------- -----------
Net Cash Used by Investing Activities (415,461) -- (415,461)
----------- -------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from stock subscription receivable 500,000 -- 500,000
Proceeds from convertible debenture 500,000 -- 500,000
----------- -------- -----------
Net Cash Provided by Financing Activities 1,000,000 -- 1,000,000
----------- -------- -----------
NET INCREASE IN CASH 158,789 -- 158,789
CASH AT BEGINNING OF PERIOD -- -- --
----------- -------- -----------
CASH AT END OF PERIOD $ 158,789 $ -- $ 158,789
=========== ======== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
8
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Statements of Cash Flows (Continued)
<TABLE>
<CAPTION>
From
For the Inception on
Six Months June 18,
Ended 1999 Through
December 31, June 30, December 31,
1999 1999 1999
----------- -------- -----------
(Unaudited) (Audited) (Unaudited)
<S> <C> <C> <C>
CASH PAID FOR:
Income taxes $ -- $ -- $ --
Interest $6,667 $ -- $6,667
NON-CASH FINANCING ACTIVITIES:
Common stock issued for machinery $ -- $3,166,700 $ --
Common stock issued for stock
subscription receivable $ -- $ 500,000 $ --
</TABLE>
The accompanying notes are an integral part of these financial statements.
9
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999 and June 30, 1999
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
a. Organization
On August 16, 1999, the Company filed an amendment to its articles of
incorporation changing its name from 3-Dx.com to i3Dx.com. i3Dx.com
(the Company) was incorporated under the laws of the State of Nevada
on June 18, 1999. The Company is a hi-tech company which utilizes the
internet (www.i3dx.com) for the development and distribution of its
products. The Company's technology is based on three-dimensional
photographic lenticular imaging and is suitable for any application
which may benefit from increased visualization, such as medical
imaging, advertising and marketing.
The Company maintains a 26,500 square foot manufacturing and processing
facility in Duluth, Georgia where it mass-produces 3D images in both
reflective print and transparency formats for the commercial, medical
and consumer markets.
b. Cash and Cash Equivalents
For purposes of financial statement presentation, the Company considers
all highly liquid investments with a maturity of three months or less,
from the date of purchase, to be cash equivalents.
c. Accounts Receivable
Accounts receivable are shown net of the allowance for doubtful
accounts of $809 and $-0- at December 31, 1999 and June 30, 1999,
respectively.
d. Fixed Assets
Fixed assets are stated at cost less accumulated depreciation.
Depreciation on machinery is provided using the straight-line method
over an expected useful life of ten (10) years. Depreciation on
equipment is provided using the straight-line method over an expected
life of five (5) years. Depreciation expense for the six months ended
December 31, 1999 and from inception on June 18, 1999 through June 30,
1999 was $158,334 and $-0-, respectively.
e. Inventory
Inventory consists of lenticular print film for use in the development
of film and pictures. Inventory is stated at the lower of cost
determined by the first-in, first-out method or market. At December 31,
1999 and June 30, 1999, inventory amounted to $57,504 and $-0-,
respectively.
f. Accounting Method
The Company's financial statements are prepared using the accrual
method of accounting. The Company has elected a June 30 year end.
The accompanying notes are an integral part of these financial statements.
10
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999 and June 30, 1999
NOTE 1 - ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (Continued)
g. Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
h. Advertising
The Company follows the policy of charging the costs of advertising to
expense as incurred.
i. Credit Risks
The Company maintains cash in multiple bank accounts. The Federal
Deposit Insurance Corporation insures accounts to $100,000. The
Company's accounts occasionally exceed these insured amounts. At
December 31, 1999, one account exceeded the insured amount by $39,559.
j. Income Taxes
No provision for federal income taxes has been made at December 31,
1999 due to an accumulated operating loss. The Company has accumulated
a $539,025 net operating loss as of December 31, 1999, which may be
used to reduce taxable income and income taxes in future years. The use
of these losses to reduce future income taxes will depend on the
generation of sufficient taxable income prior to the expiration of the
net operation loss carryforwards. The carryforwards expire in 2019.
k. Revenue Recognition
Revenue is recognized upon shipment of goods to the customer.
l. Basic and Fully Diluted Loss Per Share
During February 1997, the FASB issued Statement of Financial Accounting
Standard No. 128, "Earnings per Share". This statement changed the
method in which earnings (loss) per share are determined. The new
standard requires the computation of basic earnings (loss) per share
and earnings (loss) per share assuming dilution. Warrants (Note 3) to
purchase 2,500,000 shares of class A common stock at $4.00 per share
were outstanding at December 31, 1999 and June 30, 1999. They were not
included in the computation of net loss per common share because they
would have had an antidilutive effect on the net loss per common share
for the periods ended December 31, 1999 and June 30, 1999. Basic net
loss per common share and assuming dilution were the same for the
periods ended December 31, 1999 and June 30, 1999.
11
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999 and June 30, 1999
NOTE 2 - STOCKHOLDERS' EQUITY
The Company has authorized 90,000,000 shares of Class A common stock
(Class A) and 10,000,000 shares of Class B common stock (Class B). Each
class of stock is entitled to the following provisions as outlined
below:
DIVIDEND PROVISIONS
The holders of shares of Class A shall be entitled to receive, when and
as declared by the Board of Directors out of any funds at the time
legally available thereof, forty-nine percent (49%) of all common stock
dividends of the Company. Each share of Class A shall rank on parity
with each other share of Class A with respect to dividends. Dividend
payments to the holders of shares of Class A shall be payable in cash
by delivery of a check to each entitled holder's address which is
registered with the Secretary of the Company.
The holders of shares of Class B shall be entitled to receive, when and
as declared by the Board of Directors out of any funds at the time
legally available thereof, fifty-one percent (51%) of all common stock
dividends of the Company. Each share of Class B shall rank on parity
with each other share of Class B with respect to dividends. Dividend
payments to the holders of shares of Class B shall be payable in cash
by delivery of a check to each entitled holder's address which is
registered with the Secretary of the Company.
LIQUIDATION PROVISIONS
In the event of any liquidation, dissolution or winding up of the
Company, whether voluntary of involuntary, the Class A and Class B
shall be entitled to receive an amount equal to forty-nine percent
(49%) and fifty-one percent (51%), respectively, of the amount payable
with respect to all classes of common stock distributed ratably to the
holders of common stock.
VOTING PROVISIONS
The holders of shares of Class A and Class B shall be entitled to
forty-nine percent (49%) and fifty-one percent (51%), respectively, of
the votes then held on all matters of which the shareholders of the
Company are entitled to vote.
NOTE 3 - WARRANTS
On June 30, 1999, the Company issued warrants to purchase up to
2,500,000 shares of the Company's Class A common stock. The warrants
are exercisable at $4.00 per share. The warrants were issued as
additional consideration for purchasing stock for $500,000. The
warrants expire on June 30, 2000.
12
<PAGE>
I3DX.COM
(Formerly 3-Dx.com)
(A Development Stage Company)
Notes to the Financial Statements
December 31, 1999 and June 30, 1999
NOTE 4 - COMMITMENTS AND CONTINGENCIES
On July 1, 1999, the Company entered into a seven (7) year lease
agreement with a related party for office and warehouse space located
in Duluth, Georgia. The lease obligation is currently $18,000 per month
with annual increases in proportion to any increase in the CPI from the
date the lease is signed. Rent expense from the lease was $108,000 for
the six months ended December 31, 1999.
NOTE 5 - LICENSE RIGHTS - RELATED PARTY
On June 30, 1999, the Company acquired certain license rights from a
related company in exchange for a license fee of five percent (5%) of
gross sales attributable to the license rights. The license includes
the exclusive rights in Canada, Mexico and the United States to
manufacture and market animated and/or 3-dimensional photographic
lenticular (micro-lens) images for the initial period of fifty (50)
years without volume restrictions. The license may be renewed for a
second fifty (50) years on like terms. The Company may also sub-license
the licensed rights with written permission from the Licensor.
On October 25, 1999, the license purchase agreement was amended to
include an additional one-time fee of $400,000 to increase the scope of
the license to include sheet fed lithographic technology. The Company
paid $300,000 cash and the additional $100,000 is included in accounts
payable at December 31, 1999. The license rights will be amortized over
its expected useful life of ten (10) years. Amortization expense on the
license rights for the six months ended December 31, 1999 was $6,667.
NOTE 6 - GOING CONCERN
The Company's financial statements are prepared using generally
accepted accounting principles applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities
in the normal course of business. The Company has incurred operating
losses from its inception through December 31, 1999. It has not
established revenues sufficient to cover its operating costs which
raises doubt about its ability to continue as a going concern. However,
results of operations are within the expectations of management due to
the early stage of the Company's existence. Management believes that
revenues will be sufficient to cover and exceed operating costs by the
end of fiscal year 2000. In the interim, management plans to obtain
equity financing sufficient to cover its operating costs.
NOTE 7 - CONVERTIBLE DEBENTURE
On October 22, 1999, the Company issued a convertible debenture to a
shareholder (holder) in exchange for $500,000 cash. At the sole option
of the holder and upon thirty (30) days written notice, the holder has
the right, at any time during the term of the debenture, to convert up
to one hundred percent (100%) of the outstanding principal balance into
Class A common stock of the Company at the conversion price of two
dollars ($2.00) per share at any time prior to maturity. The term of
the note is two (2) years and interest accrues at the rate of eight
percent (8.0%) per year. The entire principal balance of the note is
due October 22, 2001 and interest is due on a monthly basis. Interest
expense on the convertible debenture was $6,667 for the six months
ended December 31, 1999.
13
<PAGE>
I3DX.COM
UNAUDITED FINANCIALS
BALANCE SHEET
AS OF APRIL 15, 2000
<TABLE>
<CAPTION>
Apr 15, '00
------------
<S> <C>
ASSETS
Current Assets
Total Checking/Savings 697,060.75
Accounts Receivable
100% Accounts Receivable 12,793.06
Accounts Receivable 27,394.02
------------
Total Accounts Receivable 40,187.08
Other Current Assets
Inventory - Other 87,018.46
Investments - Stock 66,000.00
Lenticular Print Film 44,758.63
Prepaid Deposits 50,000.00
Undeposited Funds 59.29
------------
Total Other Current Assets 247,836.38
------------
Total Current Assets 985,084.21
Fixed Assets
Tangible Assets 2,952,625.21
------------
Total Fixed Assets 2,952,625.21
Other Assets
Accumulated Amortization (16,667.50)
Deposits 18,000.00
License Rights 400,000.00
------------
Total Other Assets 401,332.50
------------
TOTAL ASSETS 4,339,041.92
============
LIABILITIES & EQUITY
Liabilities
Current Liabilities
Accounts Payable
Accounts Payable 89,871.41
------------
Total Accounts Payable 89,871.41
Other Current Liabilities
Credit Vouchers (842.64)
Sales Tax Payable 285.17
------------
Total Other Current Liabilities (557.47)
------------
Total Current Liabilities 89,313.94
Long Term Liabilities
Note Payable - Long-term 500,000.00
------------
Total Long Term Liabilities 500,000.00
------------
</TABLE>
14
<PAGE>
I3DX.COM
UNAUDITED FINANCIALS
BALANCE SHEET
AS OF APRIL 15, 2000
<TABLE>
<CAPTION>
Apr 15, '00
------------
<S> <C>
Total Liabilities 589,313.94
Equity
Common Stock Class A 366,400.00
Common Stock Class B 100,000.00
Net Income (946,972.02)
Share Premium 4,230,300.00
------------
Total Equity 3,749,727.98
------------
TOTAL LIABILITIES & EQUITY 4,339,041.92
============
</TABLE>
15
<PAGE>
I3DX.COM
UNAUDITED FINANCIALS
PROFIT AND LOSS
JULY 1, 1999 THROUGH APRIL 15, 2000
<TABLE>
<CAPTION>
Jul 1, '99 - Apr 15, '00
------------------------
<S> <C>
Ordinary Income/Expense
Income
Amateur 157,334.99
Commercial 88,038.97
Medical 42,394.00
------------
Total Income 287,767.96
Cost of Goods Sold
Other Cost of Goods Sold 27,823.21
Photofinishing Costs 67,409.37
------------
Total COGS 95,232.58
------------
Gross Profit 192,535.38
Expense
Amortization Expense 16,667.50
Bad Debt Expense 809.00
Bank Charges 3,349.12
Depreciation 237,501.00
Dues and Subscriptions 120.00
Insurance Expense 2,295.64
Legal Expense 21,262.62
Marketing / Advertising 2,754.05
Medical Insurance 24,565.13
Office Supplies 16,599.60
Outside Services / Consulting 170,871.75
Payroll Expenses 357,051.35
Postage/Shipping 19,599.39
Rent 180,000.00
Repair & Maintenance - Equip 4,116.02
Taxes 392.19
Travel 8,625.40
Travel - Meals & Entertainment 213.06
Uncategorized Expenses 5,861.30
Utilities / Telephone 32,194.13
------------
Total Expense 1,104,848.25
------------
Net Ordinary Income (912,312.87)
Other Income/Expense
Other Income
Interest Income 5,973.50
------------
Total Other Income 5,973.50
Other Expense
Expenses 23,493.86
Interest Expense 16,666.65
Refunds 472.14
------------
Total Other Expense 40,632.65
------------
Net Other Income (34,659.15)
------------
Net Income (946,972.02)
============
</TABLE>
16