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
OneCap
(Name of Small Business Issuers in its charter)
Nevada 88-0429535
(State of other jurisdiction of (I.R.S. Employer Identification
incorporation or organization Number)
5450 West Sahara Ave, 2nd Floor, Las Vegas, NV 89146
(Address of principal executive offices)
Issuer's telephone number: (702) 948-8800
Securities to be registered under section 12(b) of the Act:
Title of Each Class Name on each exchange on which
To be so registered Each class is to be registered
Securities to be registered under section 12(g) of the Act:
Common Stock, $0.001 par value per share, 20,000,000 shares
authorized, 8,811,618 issued and outstanding as of August 10, 2000.
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TABLE OF CONTENTS
Page
Part I...................................... 3
Item 1. Description of Business...................... 3
Item 2. Management's Discussion and Analysis and Plan of 11
Operation........
Item 3. Description of Property....................... 13
Item 4. Security Ownership of Management................. 13
Item 5. Directors and Executive 14
Officers....................
Item 6. Executive Compensation....................... 17
Item 7. Certain Relationships and Related 18
Transactions...............
Item 8. Description of Securities........................ 20
Part II........................................ 21
Item 1. Market for Common Equity and Related Stockholder 21
Matters.......
Item 2. Legal Proceedings......................... 21
Item 3. Changes in and Disagreements with 21
Accountants............
Item 4. Recent Sales of Unregistered 21
Securities..................
Item 5. Indemnification of Directors and 22
Officers...............
Part F/S..................................... 23
Item 1. Financial Statements........................ F-1
Part III...................................... 24
Item 1. Index to Exhibits........................... 24
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Forward Looking Statements
Some of the statements contained in this Form 10-SB that are not
historical facts are "forward-looking statements" which can be
identified by the use of terminology such as "estimates,"
"projects," "plans," "believes," "expects," "anticipates,"
"intends," or the negative or other variations, or by discussions
of strategy that involve risks and uncertainties. We urge you to be
cautious of the forward-looking statements, that such statements,
which are contained in this Form 10-SB, reflect our current beliefs
with respect to future events and involve known and unknown risks,
uncertainties and other factors affecting our operations, market
growth, services, products and licenses. No assurances can be given
regarding the achievement of future results, as actual results may
differ materially as a result of the risks we face, and actual
events may differ from the assumptions underlying the statements
that have been made regarding anticipated events. Factors that may
cause actual results, our performance or achievements, or industry
results, to differ materially from those contemplated by such
forward-looking statements include without limitation:
1. Our ability to maintain, attract and integrate internal
management, technical information and management information
systems;
2. Our ability to generate customer demand for our services;
3. The intensity of competition; and
4. General economic conditions.
All written and oral forward-looking statements made in
connection with this Form 10-SB that are attributable to us or
persons acting on our behalf are expressly qualified in their
entirety by these cautionary statements. Given the uncertainties
that surround such statements, you are cautioned not to place undue
reliance on such forward-looking statements.
Part I
We are filing this Form 10-SB on a voluntary basis to:
1. Provide current, public information to the investment
community;
2. Expand the availability of secondary trading exemptions under
the Blue Sky laws and thereby expand the trading market in our
securities; and
3. Comply with prerequisites for listing of our securities on the
NASD OTC Bulletin Board.
Item 1. Description of Business
A. Business Development and Summary
We were formed as a Nevada Corporation on June 7, 1999 under
the name OneCap. Our articles authorize us to issue up to
20,000,000 shares of common stock at a par value of $0.001 per
share and 5,000,000 shares of preferred stock at par value. We are
filing this Form 10-SB voluntarily with the intention of
establishing the fully reporting status with the SEC. The fully
reporting status is a necessary step in accomplishing our goal of
having our stock listed on the OTC Bulletin Board in the future.
Consequently, we will continue to voluntarily file all necessary
reports and forms as required by existing legislation and the SEC
rules. Presently, we have no market maker and we have not
discussed with any market maker or registered broker any aspect of
our operations.
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We provide real estate and mortgage brokerage services to real
estate owners, buyers, tenants and investors. Our goal is to
service the real estate transaction by providing:
1. Homebuyer and seller representation,
2. Land sales or purchases,
3. Commercial property sales or purchases,
4. Homeowner and commercial mortgages,
5. Construction loans,
6. Land loans,
7. Mezzanine financing,
8. Development loans and
9. Equity financing.
We developed strategic alliances with local and regional
companies to provide these services. We have alliances with
wholesale mortgage lenders to broker mortgage loans. Brokering
involves initiating and processing loan applications to be
submitted to a wholesale lender for funding. The wholesaler
underwrites, approves, closes and funds the loans based on lender-
specific, Federal National Mortgage Association, Federal Home Loan
Mortgage Corporation, Federal Housing Administration and Veterans
Administration guidelines. Examples of the companies we work with
are:
1. Interfirst, a division of ABN AMRO Mortgage Group;
2. Fleet Mortgage Corporation;
3. Irwin Mortgage Corporation;
4. North American Mortgage Company; and
5. Greenpoint Mortgage Funding, Inc.
Most of our initial revenues were derived from two related
entities in which one of our shareholders, has ownership interests:
1. Pacific Properties & Development, LLC, a developer of
commercial properties and
2. Pacific Homes, a developer of residential property.
Our CEO and Director, Mr. Steven D. Molasky, is the sole owner
of Pacific Properties. He is also a 50% shareholder in Pacific
Homes. Our affiliation to these companies provides an immediate
clientele base to market our services. Both Pacific Properties and
Pacific Homes target their real estate projects in the Nevada
market. We plan to focus our operations in Nevada and in other
Southwest markets.
Our business involves the delivery of real estate and mortgage
services and is sensitive to interest rate activity. Our success
depends largely upon the effects of interest rates on real estate
transactions. Significant rises in rates will generally cause a
reduction in real estate and mortgage activity. Such a slow down
in the real estate community will have a negative effect on our
ability to broker real estate and mortgage transactions.
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B. Business of Issuer
(1) Principal services and principal markets
We provide real estate and mortgage brokering services to the
real estate community. Our clients can search for a property, sell
a property, apply for a loan or ask for other related real estate
services in a single location or via the Internet. There are two
distinct divisions of OneCap: (1) real estate brokerage and (2)
mortgage brokerage services.
Real Estate Brokerage
Our OneCap Realty division provides brokerage services for
commercial and residential clients. We may market, buy or sell on
behalf of our clients and ourselves the following types of
properties:
1. Apartments;
2. Industrial, office and retail buildings;
3. Multi- and single-family residences;
4. Hotels and resorts; and
5. Undeveloped and developed land.
We promote our services mainly by representing buyers and
sellers in real estate transactions, which can be either new
developments or existing products. By being involved in the sale,
development and finance of various properties, we provide our
customers with quality information, service and representation.
When we receive a new brokerage engagement, we begin by
assisting the client develop a sales strategy to maximize the sales
proceeds. We consider the client's individual situation, including
time parameters, sensitivity to publicity and cash flow needs. We
also investigate and analyze the physical condition of the
property, its cash flow and tenant characteristics, market rents
and market dynamics within sub-markets and comparable transactions.
We structure our brokerage commission rates to demonstrate
confidence in our ability to sell the property at a reasonable
price. For example, if we are expected to sell a property at or
near a specified price, we might offer a commission rate that is
comparable to or below the going market rate. However, if the
seller would like us to sell the property at a price higher than
specified, we may request a higher commission rate.
Mortgage Brokerage
Our loan originations focuses on two primary areas: residential
and commercial. The residential loan volume will be generated
primarily from referrals from OneCap Realty and referrals from
independent brokers and realtors. We offer a wide range of
mortgage programs through correspondent lender relationships. We
are also an approved lender through the Housing and Urban
Development Department and VA, and offer all types of FHA and VA
financing. In addition to the traditional referral sources, we
also attract customers via our website at www.onecap.com.
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The commercial volume includes referrals from affiliated
companies, such as Pacific Properties, as well as originations
through outside builders and developers. We have various
relationships with banks, life insurance companies, large national
lenders and investment banking companies. Our loan products
include land acquisition, construction lending, mezzanine loans and
permanent loans. Although we have access to multiple loan
programs, we expect to capitalize on our ability to provide niche
products, such as high-leverage land acquisition loans and equity
lending through strategic alliances with several investment banks.
However, we have a limited operating history, and we face all of
the risks inherent in the real estate industry. These risks
include, but are not limited to, market acceptance and penetration
of our services, our ability to broker real estate and mortgage
products and services, management of the costs of conducting
operations, general economic conditions and factors that may be
beyond our control. We cannot assure you that we will be
successful in addressing these risks. Failure to successfully
address these risks could have a material adverse effect on our
operations.
(2) Distribution methods of our services
Our strategy is to achieve high levels of customer satisfaction
and repeat business and to establish recognition and acceptance of
our business. Our strategy includes the following key elements:
1. Introducing new financing products to satisfy client needs and
reach new clients,
2. Bolstering our Internet presence,
3. Forming additional strategic alliances, and
4. Building our brand equity.
Introducing New Financing Products to Satisfy Client Needs and
Reach New Clients
We will attempt to develop and introduce innovative financing
products to offer the real estate owner opportunities that may not
exist. By providing these products, we believe we will package
services and products to fill the need in the market for higher
leveraged financing that will both satisfy and attract clients.
These services and products will provide options for buyers and
sellers, increasing the likelihood of closed transactions.
Bolstering Our Internet Presence
The Internet allows us to expand our geographical impact by
reaching prospective customers and introducing greater efficiencies
to the real estate and mortgage process. We are continuing to
design and develop our website as a mechanism for the marketing and
sale of real estate. Our website includes photographs of
properties available for sale, real estate reports on each of those
properties and an electronic loan application for residential and
commercial loans.
Forming Additional Strategic alliances
We may pursue strategic alliances with partners who have
established operations. We believe that these joint venture
relationships, if successful, will allow us to gain additional
insight, expertise and penetration in markets where joint venture
partners already operate.
Our business relationship with a Las Vegas developer of
commercial properties provides us with an existing market for our
services. We believe we can expand our client base by utilizing
existing real estate offerings from Pacific Properties, a related
party. We provide real estate and mortgage commercial brokerage
services for Pacific Properties at market rates. With appropriate
networking, advertising and marketing, to penetrate this market and
differentiate ourselves from the competition, we must continue to
develop appropriate networking, advertising and marketing
strategies.
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We also provide mortgage services to homebuyers who purchase
homes from Pacific Homes, a related entity. We provide realty
sales services for Pacific Homes and provide Pacific Homes' new
homebuyers mortgage services. Since we have established our base
of operations, we are able to institute residential sales, buyer's
representation and listings relatively quickly.
Building Our Brand Equity
We believe that building awareness of the OneCap brand is
important in expanding our customer base. We intend to
aggressively market and advertise to enhance our brand recognition
with consumers. We currently advertise through traditional and non-
traditional media such as local newspapers and industry-specific
publications, as well as over the Internet.
Our marketing efforts have consisted of television, print and
Internet advertising. We cannot assure you that we will be
successful in attracting customers. If we fail to attract
customers to use our services, we will be unable to generate
revenues to support continuing operations.
(3) Status of any announced new service
As of August 10, 2000, we have:
1. Developed and implemented a business plan;
2. Recruited and retained an appropriate management team and
board of directors;
3. Attained capital from an equity offering;
4. Developed our corporate web site at www.onecap.com;
5. Instituted a marketing campaign encompassing print, television
and the Internet; and
6. Entered into agreements with wholesale lenders to originate
mortgage loans.
We have commenced operations and have begun generating revenues.
However, we expect our industry to become increasingly competitive,
despite the growth expected in the market. We intend to compete by
offering a wide range of products and services to commercial and
residential real estate clients. Our goal is to ensure client
satisfaction with our services and to develop strategic
relationships to increase our service offerings.
(4) Industry background
The most critical components of all real estate transactions are
service, financing and comprehensive and reliable information.
Property-specific information, accurate market information and
providing timely financing needs translates to time and money for a
client. Typically, each step in the buying or selling transaction
requires several different service companies and takes an
inordinate amount of the client's time searching for the right
combination of services. Companies often have multiple real estate
brokers and financing sources, which require an excessive amount of
time to find the right lender or realtor for each specific request
or transaction. A single project may require several different
companies' involvement in the process of development. For example,
when a builder wants to build an office building, the following
steps must be performed:
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1. A broker finds the land;
2. A land lender finances the initial purchase and an equity
lender finances what the land lender cannot;
3. A development and construction lender must be found to take on
the project;
4. Another broker is needed to lease the office space as it is
being built;
5. A permanent lender is found to finance the end-loan; and
6. Another broker may be selected to sell the building.
Lenders and brokers are usually specific by transaction, which
is time consuming, and a single source would save time and money.
We operate in a highly competitive market and compete with a
variety of organizations that offer services similar to those we
offer. The market includes a variety of participants, including
national and regional:
1. Realty brokers,
2. Mortgage institutions and
3. Financial lending institutions.
Some of our competitors have significantly greater financial,
technical and marketing resources, generate greater revenues and
have greater name recognition than we do.
Our ability to compete depends in part on:
1. Economic factors such as interest rates and the level of
economic expansion;
2. Our ability to attract, hire, develop and retain skilled
personnel;
3. The level of real estate activity; and
4. Our ability to market our real estate and mortgage brokering
services to the real estate market.
Failure to address these risks could make our business
unprofitable.
(6) Customers
Our focus is on developing our brand recognition and a quality
reputation in the market place. We will also convey the quality
and wide range of services offered that is expected from
professional representation on either the buyer's or seller's end
of a real estate transaction.
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The current forms of advertising we currently use are:
1. Our corporate website - We have developed a website for OneCap
at www.onecap.com. The website features a mortgage calculator,
resale listings, news and public relation stories. The web page
may be eventually linked to many of the major search engines to
increase attraction and website visits. Additionally an E-mail
database has been established to link our web page to E-mail news
that can be sent on a monthly basis to realtors, builders, banks
and mortgage companies.
2. Brochures describing buyers representation and our services -
These brochures are included at our existing offices and are
promoted internally with the on-site agent. Additional points of
advertising may include rip-off racks at the chamber of commerce,
malls and in the lobbies of several apartment communities currently
managed by an affiliated entity, Molasky Pacific Management,
partially owned and controlled by Mr. Steven D. Molasky.
3. Our monthly newsletter - We have a monthly newsletter called "
Las Vegas Real Estate Update" that is posted on our website. It is
used to inform readers of our corporate development, growth and the
services we provide. This letter will target market groups such as
non-owner occupied residences, data source obtained from mall
traffic and those wishing to subscribe and current or future
clients. Visitors to our website are able to subscribe to receive
our newsletter via regular mail.
4. Signage - Residential and commercial signs are placed on
listings handled by us and magnetic car plaques have been
distributed to our agents. We believe this promotes our name
through reach and frequency in the marketplace and further
generates qualified clients.
5. Regional print media - We have committed to advertising and
marketing our services in various home buying and relocation guides
that are distributed in Southern Nevada. These print magazines
allow us to target families and individuals seeking to purchase a
new or resale home in the Las Vegas community.
6. Regional television media - We signed an agreement to
advertise on the weekly regional television program, "The Home
Show." The program airs locally in the Southern Nevada area. In
addition, our agreement allows us to place a web link on the
programs Internet site, www.lasvegashomeshow.com. This link takes
visitors to our corporate web page, where they are able to learn
about our services more in-depth.
For the five months ended May 31, 2000, we generated $329,400 of
sales revenue. We anticipate that we will continue to derive the
majority of our revenues from related entities under common
control. Our business is dependent on revenues received from fees
related to the services we provide our clients. If we fail to
market our services and thereby attract new customers or maintain
existing relationships, we will be unable to generate sufficient
revenue to continue operations.
(7) Service Marks
On September 16, 1999, we applied for new service marks with the
Assistant Commissioner for Trademarks. As of the date of this
registration statement, our service mark application number 13630-
0001 is pending.
(8) Regulation
Our real estate operations are subject to various federal, state
and local regulations in the U.S. We must have an officer licensed
as a real estate broker or we must associate with a licensed broker
in each state in which we provide our services. Each employee that
performs certain brokerage functions in the State of Nevada must be
a licensed real estate salesperson and she must work under the
supervision of a broker licensed by that state. In addition to
these licensing requirements, certain state governmental entities,
such as the Nevada Department of Real Estate, regulates our
brokerage operations by requiring our resident operative to be
licensed.
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In various states, governmental entities license individual
auctioneers and administer various regulations governing their
activities and may require that auctioneers post bonds. We believe
that we are in compliance with all material licensing and bonding
requirements in the State of Nevada, in which auctioning licenses
and bonds are required, and in which we are engaged in material
auction activities.
Our mortgage brokerage operations are subject to the rules and
regulations of the FHA, VA, FNMA, FHLMC and Government National
Mortgage Association with respect to originating and processing
mortgage loans. Those rules and regulations, among other things,
prohibit discrimination and establish underwriting guidelines which
include provisions for inspections and appraisals, require credit
reports on prospective borrowers and fix maximum interest rates.
Moreover, lenders are subject to FNMA, FHA, FHLMC, GNMA and VA
examinations at any time to assure compliance with the applicable
regulations, policies and procedures. Our mortgage loan production
activities are subject to the Truth-in-Lending Act and Regulation Z
promulgated, thereunder. The Truth-in-Lending Act contains
disclosure requirements designed to provide consumers with uniform,
understandable information with respect to the terms and conditions
of loans and credit transactions in order to give them the ability
to compare credit terms. The Truth-in-Lending Act also guarantees
consumers a three-day right to cancel certain credit transactions,
including any refinance mortgage or junior mortgage loan on a
consumer's primary residence. We are also required to comply with
the Equal Credit Opportunity Act of 1974, as amended, which
prohibits creditors from discriminating against applicants on the
basis of race, color, sex, age or marital status. Regulation B
promulgated under ECOA restricts creditors from obtaining certain
types of information from loan applicants. It also requires
certain disclosures by lenders regarding consumer rights and
requires lenders to advise applicants of the reasons for any credit
denial. In instances where the applicant is denied credit or the
rate or charge for loans increases as a result of information
obtained from a consumer credit agency, another statute, the Fair
Credit Reporting Act of 1970, as amended, requires the lenders to
supply the applicant with a name and address of the reporting
agency. The Federal Real Estate Settlement Procedure Act imposes,
among other things, limits on the amount of funds a borrower can be
required to deposit with us in an escrow account for the payment of
taxes, insurance premiums or other charges. We have policies,
procedures and systems in place to ensure compliance with RESPA.
(9) Effect of existing or probable government regulations
We believe that we will be able to comply in all material
respects with laws and regulations governing real estate and
mortgage brokering activities. We are not aware of any probable
government regulations that may adversely affect our business.
(12) Employees
We presently have 10 full-time and no part-time employees. Our
employees are not represented by a collective bargaining agreement,
and we believe that our relations with our employees are good.
We adopted a retirement savings plan for our employees under
Section 401(k) of the Internal Revenue Code. The plan allows
employees to defer up to the lesser of the Internal Revenue Code
prescribed maximum amount or 15% of their income on a pre-tax basis
through contributions to the plan. We will match 25% of eligible
employees' contributions up to a maximum of 6% of their individual
earnings.
On July 27, 2000, we approved a stock option plan with the goal
of motivating our employees. We have allocated up to 1,250,000
shares of common stock that may be granted under our stock option
plan. The purchase price for the shares covered under each option
will be no less than 100% of the fair market price per share of our
stock on the date the option is granted. However, if the option is
granted to a person owning more than 10% of our voting stock, the
option can be converted at no less than 110% of the fair market
price per share on the date the option is granted. No options have
been granted as of August 10, 2000.
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Item 2. Management's Discussion and Analysis
Forward Looking Statements
When used in this Form 10-SB and in our future filings with the
Securities and Exchange Commission, the words or phrases "will
likely result," "management expects," or "we expect," "will
continue," "is anticipated," "estimated" or similar expressions are
intended to identify "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995.
Readers are cautioned not to place undue reliance on any such
forward-looking statements, each of which speak only as of the date
made. These statements are subject to risks and uncertainties, some
of which are described below. Actual results may differ materially
from historical earnings and those presently anticipated or
projected. We have no obligation to publicly release the result of
any revisions that may be made to any forward-looking statements to
reflect anticipated events or circumstances occurring after the
date of such statements.
A. Management's Discussion and Analysis
(1) For the five months ended May 31, 2000 we incurred a net loss
of $47,600 and generated $329,400 in revenues from operations.
The following comprises the capitalization history for OneCap:
1. On June 7, 1999, we issued 100 shares of our common stock with
no par value to one founding shareholder. The shares were issued
in exchange for cash and assets totaling $19,600. This original
stock offering was made in accordance with Section 4(2) of the
Securities Act of 1933, as amended.
2. On November 2, 1999, the one shareholder exchanged all of his
100 shares of common stock with no par value for 100 shares of
common stock with a par value of $0.001 per share and an additional
4,999,900 shares of common stock at par value of $0.001 per share.
In addition, we issued 1,937,500 shares of $0.001 par value common
stock to a second individual. These shares were issues in exchange
for cash of $6,900. This stock issuance was made in accordance
with Section 4(2) of the Securities Act of 1933, as amended.
3. On May 26, 2000, we issued 1,659,200 shares of common stock to
130 unaffiliated shareholders and eight affiliated shareholders at
a price of $0.25 per share, for total receipts of $414,800 in cash.
This offering was made in reliance upon an exemption from the
registration provisions of the Securities Act of 1933, as amended,
in accordance with Regulation D, Rule 504 of the Act.
4. On May 26, 2000, we issued 214,918 shares to one shareholder
in lieu of services rendered in the amount of $53,729. This stock
issuance was made in accordance with Section 4(2) of the Securities
Act of 1933, as amended.
As of the date of this filing, we have 8,811,618 shares of par
value common voting stock issued and outstanding, which are held by
approximately 141 shareholders of record. If we require more
capital, we may be required to raise additional capital via a
public or private offering of equity or debt. There are no
preliminary loan agreements or understandings between us, our
officers, directors or affiliates or lending institutions. We have
no arrangements or commitments for accounts and accounts receivable
financing. We cannot assure you that any such financing can be
obtained or, if obtained, that it will be on reasonable terms.
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For the five months ended May 31, 2000, we have generated
$329,400 in sales revenues and devoted our efforts primarily to
developing our services, implementing our business strategy and
raising working capital through equity financing. Our revenues
are primarily dependent upon our ability to market and provide
real estate and mortgage products and services. Our priorities
for the next 12 months of operations are:
1. Completing our relocation to our new corporate offices;
2. Expand our clientele base and accounts through marketing and
advertising, our Internet site, personal and business contacts and
print and television media;
3. Modify our web site to allow secure mortgage applications to
be completed electronically;
4. Expand our commercial real estate division to include
commercial property management and leasing activities;
5. Enter the Spanish-speaking market through our bi-lingual loan
officer; and
6. Developing further strategic relationships.
We cannot guarantee you that we will be able to compete
successfully or that the competitive pressures we may face will
not have an adverse effect on our business, results of operations
and financial condition. Additionally, intensified competition in
the real estate market could force us out of business.
(2) The following is a summary of our results of operations for
the five months ended May 31, 2000 and for the period June 7, 1999
to December 31, 1999.
Period Ended Period Ended
May 31, 2000 December 31,
1999
Revenue $329,400 $485,400
Expenses $383,000 $318,000
Net income $(47,600) $166,400
(loss)
To fund fiscal 2000 operations, we believe our current financial
resources and ability to generate revenues will be adequate to
fund our operations and provide for our working capital needs
through December 2000. However, we may experience fluctuations in
operating results in future periods due to a variety of factors,
such as:
1. We have a limited operating history on which to base estimates
of future performance;
2. We may need to obtain additional financing in the event that
we are unable to realize sales of our services or if we require
more capital than we currently have;
3. Our market is highly competitive; and
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4. We may experience difficulty in managing growth.
Item 3. Description of Property
A. Description of Property
Our corporate offices are at 5450 West Sahara Avenue, 2nd floor
Las Vegas, Nevada 89146. These new facilites will allow for future
expansion and growth. On July 9, 2000, we entered into a lease
for approximately 13,173 square feet of office space, ending
January 31, 2003. The lease payments will total $19,759.50 per month
for the period August 1, 2000 through September 30, 2000, and will
increase annually after that date.
Item 4. Security Ownership of Management
A. Security Ownership of Management
The following table sets forth as of August 10, 2000 certain
information regarding the beneficial ownership of our common stock
by:
1. Each person who is known us to be the beneficial owner of more
than 5% of the common stock,
2. Each of our directors and executive officers and
3. All of our directors and executive officers as a group.
Except as otherwise indicated, the persons or entities listed
below have sole voting and investment power with respect to all
shares of common stock beneficially owned by them, except to the
extent such power may be shared with a spouse. No change in
control is currently being contemplated.
Name and Address Shares Beneficially Percentage of Shares
Owned Outstanding
Steven D. 5,000,000 56.74%
Molasky
5450 West Sahara Avenue,
2nd floor Las Vegas,
Nevada 89146
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Vincent W. 1,937,500 21.99%
Hesser
5450 West Sahara Avenue,
2nd floor Las Vegas,
Nevada 89146
Eric Bordenave 40,000 0.45%
5450 West Sahara Avenue,
2nd floor Las Vegas,
Nevada 89146
Scott Lawrence 4,000 NMF1
5450 West Sahara Avenue,
2nd floor Las Vegas,
Nevada 89146
Total ownership 6,981,500 79.23%
by our officers
and directors
(four
individuals)
1. Represents a percentage of less than 0.01%.
B. Persons Sharing Ownership of Control of Shares
No person other than Steven D. Molasky and Vincent W. Hesser
owns or shares the power to vote 5% or more of our securities.
Item 5. Directors and Executive Officers
A. Directors and Executive Officers
The following table sets forth certain information with respect
to each of our executive officers or directors.
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Name Age Position Appointed
Steven D. 48 CEO, Secretary, Treasurer July 1,
Molasky and Director 1999
Vincent W. 34 President, COO and Director July 1,
Hesser 1999
Scott Lawrence 40 Vice President - Mortgage June 7,
Operations 1999
Eric Bordenave 38 Vice President, Corporate May 15,
Broker 2000
B. Work Experience
Steven D. Molasky, Chief Executive Officer, Secretary, Treasurer
and Director - Mr. Molasky has experience in the real estate
development business dating back to the late 1960's. Through his
various companies, including Pacific Homes and Pacific Properties,
Mr. Molasky has developed:
1. Homes and condominiums for sale;
2. Apartment complexes;
3. Distribution and industrial product;
4. Master-planned communities;
5. Retail shopping centers; and
6. High rise office buildings.
Mr. Molasky specializes in real estate financing, having
nurtured and developed long-term relationships within the industry.
Included in this group are
1. Prudential Real Estate,
2. Long Term Credit Bank of Japan,
3. Northwestern Mutual Life Insurance Company,
-15-
4. Teachers Insurance and Annuity Association,
5. Bank One, and
6. Nomura Asset Capital Corporation and Capital Company of
America.
Also included are liaisons with local and regional financial
institutions.
Having a strong sense of community, Mr. Molasky has:
1. Served as a founding member and past chairman of the Nevada
Institute for Contemporary Art;
2. Been appointed by the Clark County Commission as a director
and board member of the McCarran Arts Advisory Council; and
3. Was appointed by the Nevada Legislature as a board member of
the Nevada Nuclear Projects Commission.
Mr. Molasky also serves as a trustee/director of the University of
Nevada, Las Vegas Foundation and is a member of the Young
President's Organization.
Vincent W. Hesser, President, Chief Operating Officer and
Director - Mr. Hesser's areas of responsibility includes
1. Coordinating the development of corporate policies, goals and
objectives relative to company operations;
2. Lender and investor relations; and
3. Financial performance and growth.
Mr. Hesser oversees the daily company operations and business
affairs to ensure that business objectives are achieved. During
his tenure as a finance executive at Pacific Properties from 1992-
1999, Mr. Hesser has obtained project equity and debt financing for
real estate projects, and he has overseen the build-out of housing,
apartment and commercial real estate projects.
Mr. Hesser began his career at PriMerit Bank, which was
subsequently purchased by Norwest, which was in turn acquired by
Wells Fargo, in Las Vegas, Nevada. He was responsible for
analyzing, evaluating and reporting on real estate joint ventures
throughout the southwestern United States, with real estate and
development companies. He also assisted the bank in their reviews
with the Office of Thrift Supervision and Federal Deposit Insurance
Corporation in relation to those investments.
Mr. Hesser is a graduate of Southern Utah University and earned
his Master of Accountancy degree, summa cum laude and with high
distinction. He has obtained his CPA Certificate and also holds a
general contractors license in the State of Nevada.
Scott Lawrence, Vice President - Mortgage Operations - With over
16 years of mortgage lending experience, specializing in new home
financing, Mr. Lawrence brings knowledge of mortgage financing. He
created and managed the mortgage operations and an interest rate-
hedging program for Falcon Development, a developer in Las Vegas
and Denver.
-16-
In 1996, Mr. Lawrence worked on creating the mortgage subsidiary
for Beazer Homes, consulted with builders, such as Trinity Homes,
Zaring Homes, Oriole Homes and Weitzer Homes, on strategies for
mortgage origination's, as well as retro-fitting the mortgage
operations for a homebuilder in Las Vegas. Subsequently, Mr.
Lawrence took a position with Pacific Homes Financial in late 1996.
In addition to the end-loan financing that Pacific Homes Financial
previously provided, Mr. Lawrence has created several strategic
alliances with various capital sources to provide purchasing,
development, construction and permanent financing for the various
multi-family and commercial projects that Pacific Properties &
Development, LLC, develops in various markets.
Prior to coming to Las Vegas in 1994, Mr. Lawrence worked with a
consulting firm, working with the Builder 200, setting up and
managing builder owned mortgage companies. Mr. Lawrence graduated
with a Bachelor of Science degree in Marketing Management from New
England College in Henniker, New Hampshire in 1981.
Eric Bordenave, Vice President and Corporate Broker - Over the
last 15 years, Mr. Bordenave has been active in real estate sales
and development in Las Vegas, holding positions real estate
developers including Pacific Homes from 1990 to 1995. Mr.
Bordenave has operated a real estate advisory group, which advised
several overseas banking institutions and their affiliates on U.S.
real estate ventures.
Mr. Bordenave has worked for the City of Las Vegas as a real
estate analyst and development coordinator under the direction of
the City Manager to develop several of the City's multi-use
business parks and redevelopment projects.
Mr. Bordenave's past experience includes all aspects of real
estate development, purchasing, disposition, leasing, brokerage,
land development and planning and project management.
Mr. Bordenave is a graduate of the University of Nevada, Las
Vegas and holds a Bachelor of Science in Business Administration
with a major in Business Management. He currently holds the active
Nevada Real Estate Brokers license for OneCap.
Item 6. Executive Compensation
Remuneration of Directors and Executive Officers
We do not currently have employment agreements with our
executive officers but we expect to sign employment agreements with
each in the next approximately six months. Messrs. Scott Lawrence
and Eric Bordenave have been drawing salaries since they were
appointed to their positions.
Name Capacities in which Annual
Remuneration was Recorded Compensation
Steven D. CEO, Secretary, Treasurer and Incentive
Molasky Director Basis1
Vincent W. President, COO and Director Incentive
Hesser Basis1
-17-
Scott Vice President - Mortgage $125,000
Lawrence Operations
Eric Vice President, Corporate $90,000
Bordenave Broker
1. Certain executives have deferred payment of salaries based on
our cash flow and financial performance. Messieurs Steven D.
Molasky and Vincent W. Hesser are compensated on a cash incentive
basis, based on performance. This incentive is 12.5% of our net
revenues, dispersed on a monthly basis, which will be split equally
between the two individuals.
Stock Option Plan
On July 27, 2000, we approved a stock option plan. The plan
allocated up to 1,250,000 shares of common stock that may be
granted. The purchase price for the shares covered under each
option may be no less than 100% of the market price per share on
the date the option is granted. However, if the option is granted
to a person owning more than 10% of our voting stock, the option
cannot be converted at less than 110% of the fair market price per
share on the date the option is granted. No options have been
granted as of August 10, 2000.
Compensation of Directors
There were no arrangements pursuant to which any director was
compensated for the period from June 7, 1999 to August 10, 2000,
for service provided as a director.
Item 7. Certain Relationships and Related Transactions
S Corporation Status
On November 5, 1999, we revoked our S election and elected not
to have the prop rata allocation of S corporation items under the
IRC Section 1362(e)(2) apply to the S termination year. Before
November 5, 1999, we were treated as an S corporation for Federal
income tax purposes. As an S corporation, we passed through the
taxable income and losses to our shareholders each year as it was
recognized, and thus we paid no corporate income tax.
Agreements and Contracts
We have entered into relationships with the credit services,
wholesale lenders and advertising media companies.
1. Credit services - We have entered into agreements to obtain
credit information on prospective borrowers. Credit reports
provide our wholesale lenders and us due diligence to determine to
credit quality and background of the client requesting a mortgage.
Our agreements are as follows:
-18-
Company Date of Contract
Factual Data of Nevada April 18, 2000
Executive Reporting September 15, 1999
Services
2. Mortgage brokering agreements - We have entered into
agreements to originate mortgage loans for wholesale lenders.
Under the agreements we prepare the paperwork and perform
background checks on prospective borrowers. We then contact a
lender, who will fund the mortgage. Our brokering agreements are
as follows:
[See chart on next page]
Company Date of Contract
Fleet Mortgage Corporation October 1, 1999
Greenpoint Mortgage Funding, Inc. February 25, 2000
Interfirst, a division of October 8, 1999
ABN Amro Mortgage Group
Irwin Mortgage Corporation October 14, 1999
North American Mortgage Company March 3, 2000
3. Advertising agreements - We advertise in print media, during
television programs and on the Internet. We have engaged various
publications and products to display our promotions on a recurring
basis. We advertise with the following companies:
Program or Description Date of Contract
Circulation
"The House Detective" Bi-weekly regional December 20,
television program 1999
-19-
"The Home Show" Weekly regional February 10,
television program 2000
"Here is Las Vegas" Bi-annual regional October 13, 1999
relocation guide
"Southern Nevada Monthly regional April 5, 2000
Homes Magazine" home buying guide
Las Vegas Chamber of Annual national May 22, 2000
Commerce Relocation relocation magazine
Guide
"Homes and Living" Monthly regional December 2, 1999
home buying magazine
"Homes and Living" Monthly regional February 9, 2000
direct-mail brochure
Item 8. Description of Securities
Our authorized capital stock consists of 20,000,000 shares of
common stock, par value per share and 5,000,000 shares of preferred
stock, par value. As of August 10, 2000, we had 8,811,618 shares
of common stock outstanding. To date, we have not issued preferred
stock. The holders of shares of our common stock are entitled to
one vote for each share on all matters on which the holders of
common stock are entitled to vote. There is no cumulative voting
for the election of directors. Subject to the rights of any
outstanding shares of preferred stock, the holders of our common
stock are entitled to receive ratably such dividends as may be
declared by the Board of Directors out of funds legally available
therefore. Holders of our common stock are entitled to share
ratably in our net assets upon liquidation or dissolution after
payment or provision for all liabilities and the preferential
liquidation rights of any shares of preferred stock then
outstanding. Our holders of common stock have no pre-emptive
rights to purchase any shares of any class of our stock. All
outstanding shares of common stock are, and our shares of common
stock to be issued pursuant hereto will be, upon payment therefore,
fully paid and non-assessable.
-20-
Part II
Item 1. Market for Common Equity and Related Stockholder
Matters
B. Holders
As of August 10, 2000, we had approximately 141 stockholders of
record.
D. Reports to Shareholders
We will furnish our shareholders with annual reports containing
audited financial statements and such other periodic reports as we
determine to be appropriate or as may be required by law. We are
filing this Form 10-SB voluntarily with the intention of
establishing the fully reporting status with the SEC. Upon the
effectiveness of this Registration Statement, we will be required
to comply with periodic reporting, proxy solicitation and certain
other requirements by the Securities Exchange Act of 1934.
Consequently, we will voluntarily file all necessary reports and
forms as required by existing legislation and the SEC rules.
E. Transfer Agent and Registrar
The Transfer Agent for our shares of common voting stock is
Shelley Godfrey, Pacific Stock Transfer Company, 5844 S. Pecos,
Suite D, Las Vegas, Nevada 89120, (702)-361-3033.
Item 2. Legal Proceedings
We are not currently involved in any legal proceedings nor do we
have any knowledge of any threatened litigation.
Item 3. Changes in and Disagreements with Accountants
We have had no disagreements with our independent accountants.
Item 4. Recent Sale of Unregistered Securities
The following discussion describes all the securities we have
sold within the past three fiscal years:
On June 7, 1999, we issued 100 shares of our common stock with
no par value to one founding shareholder. The shares were issued
in exchange for cash and assets totaling $19,600. This original
stock offering was made in accordance with Section 4(2) of the
Securities Act of 1933, as amended. No underwriting discounts or
commissions were paid in this offering.
On November 2, 1999, the one shareholder exchanged all of his
100 shares of common stock with no par value for 100 shares of
common stock with a par value of $0.001 per share and an
additional 4,999,900 shares of common stock at par value of $0.001
per share. In addition, we issued 1,937,500 shares of $0.001 par
value common stock to a second individual. These shares were
issues in exchange for cash of $6,900. This stock issuance was
made in accordance with Section 4(2) of the Securities Act of
1933, as amended.
On May 26, 2000, we issued 1,659,200 shares of common stock to
130 unaffiliated and eight affiliated shareholders at a price of
$0.25 per share, for total receipts of $414,800 in cash. This
offering was made in reliance upon an exemption from the
registration provisions of the Securities Act of 1933, as amended,
in accordance with Regulation D, Rule 504 of the Act. In
addition, this offering was made on a best efforts basis and was
not underwritten.
-21-
On May 26, 2000, we issued 214,918 shares to one shareholder in
lieu of services rendered in the amount of $53,729. This stock
issuance was made in accordance with Section 4(2) of the
Securities Act of 1933, as amended. No brokers or dealers were
involved in this transaction and no discounts or commissions were
paid.
Item 5. Indemnification of Directors and Officers
Neither our Articles of Incorporation nor our bylaws provide for
the indemnification of a present or former director or officer.
However, pursuant to Nevada Revised Statutes Section 78.750 and 751
we must indemnify any of our directors, officers, employees or
agents who are successful on the merits or otherwise in defense on
any action or suit. Such indemnification shall include, expenses,
including attorney's fees actually or reasonably incurred by him.
Nevada law also provides for discretionary indemnification for each
person who serves as or at our request as one of our officers or
directors. We may indemnify such individuals against all costs,
expenses and liabilities incurred in a threatened, pending or
completed action, suit or proceeding brought because such
individual is one of our directors or officers. Such individual
must have conducted himself in good faith and reasonably believed
that his conduct was in, or not opposed to, our best interests. In
a criminal action, he must not have had a reasonable cause to
believe his conduct was unlawful.
-22-
Part F/S
Item 1. Financial Statements
The following documents are filed as part of this report:
a) OneCap Page
Report of Bradshaw, Smith & Co., LLP F-1
Balance Sheet as of May 31, 2000 and December F-2
31, 1999
Statement of Operations for the five months
ended May 31, 2000 and for
the period from June 7, 1999 to December 31, F-3
1999
Statement of Stockholder's Equity for the five
months ended May 31, 2000
for the period from June 7, 1999 to December F-4
31, 1999
Statement of Cash Flows for the five months
ended May 31, 2000 and for
the period from June 7, 1999 to December 31, F-5
1999
Notes to Financial Statements F-6
-23-
********************************************************************
OneCap
FOR THE MONTHS ENDED MAY 31, 2000 AND FOR THE PERIOD FROM
JUNE 7, 1999 (INCEPTION) TO DECEMBER 31, 1999
CONTENTS
PAGE
Independent auditors' report 1
Financial Statement:
Balance Sheets 2
Statement of Operations 3
Statement of Stockholders' 4
Equity
Statement of Cash Flows 5
Notes to Financial 6-10
Statements
Bradshaw, Smith & Co., LLP
CPA'S, Business Advisors & Consultants
OneCap
REPORT ON AUDITS OF FINANCIAL STATEMENTS
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND FOR THE PERIOD
FROM JUNE 7,1999 (INCEPTION) TO DECEMBER 31,1999
Bradshaw, Smith & Co., LLP
CPAs, Business Advisors
& Consultants
5851 West Charleston
Las Vegas, Nevada 89146
(702) 878-9788
FAX (702) 878-4510
INDEPENDENT AUDITORS' REPORT
Board of Directors
OneCap
Las Vegas, Nevada
We have audited the accompanying balance sheets of OneCap as
of May 31, 2000 and December 31, 1999, and the related
statements of operations, stockholders' equity, and cash
flows for the five months ended May 31, 2000 and for the
period from June 7, 1999 (inception) to December 31, 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 audits.
We conducted our audits 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 audits provide 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 OneCap as of May 31, 2000 and December 31, 1999,
and the results of its operations and its cash flows for the
periods then ended in conformity with generally accepted
accounting principles.
/s/Bradshaw, Smith & Co., LLP
June 14, 2000
-F1-
OneCap
BALANCE SHEETS
MAY 31, 2000 AND DECEMBER 31, 1999
ASSETS
May December
31, 2000 31, 1999
Current assets:
Cash $480,400 $285,300
Accounts receivable (net of allowance for 57,500 1,800
doubtful accounts of $-0-)
Deferred income taxes (Note 3) 4,700
Total current assets 542,600 287,100
Property and equipment (Note 4) 32,300 20,300
Other assets (net of accumulated 9,200 12,600
amortization of $1,100)
$584,100 $320,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and other liabilities $35,400 $88,400
Income tax payable 3,700
Accounts payable, related parties (Note 2) 4,000 35,000
Total current liabilities 39,400 127,100
Commitments and contingencies (Note 5)
Stockholders' equity (Note 6):
Preferred stock, $.001 par value authorized 8,800 6,900
5,000,000 shares, issued and outstanding -
none
Common stock, $.001 par value; authorized
20,000,000 shares, issued and outstanding,
8,811,618 and.6,937,500 shares
Additional paid-in capital 417,100 19,600
Retained earnings 118,800 166,400
544,700 192,900
$584,100 $320,000
The Notes to Financial Statements are an integral part of
these statements.
-F2-
OneCap
STATEMENTS OF OPERATIONS
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMBER
31,1999
Period Period
Ended May Ended
31, 2000 December
31, 1999
Revenues:
Loan fees and commissions $329,400 $485,400
Expenses:
General and administrative expenses(Note 2) 379,100 313,700
Depreciation and amortization expense 3,900 4,300
383,000 318,000
Income (loss) from operations (53,600) 167,400
Other income:
Interest income 1,300 2,700
Net income (loss) before income taxes (52,300) 170,100
Income tax expense (benefit) (Note 3):
Current federal 3,700
Deferred federal (4,700)
(4,700) 3,700
Net income (loss) $(47,600) $166,400
Earnings (loss) per common share $(0.007) 0.024
Weighted average number of common shares 7,011,968 6,237,500
outstanding
The Notes to Financial Statements are an integral part of
these statements.
-F3-
OneCap
STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMBER
31,1999
Common Stock Additional Retained Stockholders
Paid-In Earnings Equity
Capital
Shares Amount
Balance, June
7, 1999
(Inception)
Issuance of 6,937,500 6,900 19,600 26,500
shares
Net income 166,400 166,400
Balance, 6,937,500 6,900 19,600 166,400 192,900
December 31,
1999
Issuance of 1,874,118 1,900 397,500 399,400
shares
Net loss (47,600) (47,600)
Balance, May 8,811,618 8,800 $417,100 $118,800 $544,700
31, 2000
The Notes to Financial Statements are an integral part of
these statements.
-F4-
OneCap
STATEMENTS OF CASH FLOWS
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECKNOER
31,1999
Period Period
Ended May Ended
31, 2000 December
31, 1999
Cash flows from operating activities:
Net (loss) income $(47,600) $166,400
Adjustments to reconcile net (loss) income to net cash (used)
provided by operating activities:
Depreciation and amortization 3,900 4,300
(Increase) decrease in accounts (55,700) 1,400
receivable
Decrease (increase) in other assets 3,400 (13,600)
(Decrease) increase in accounts payable (84,000) 124,100
and other liabilities
(Decrease) increase in income tax (3,700) 3,700
payable
Increase in deferred tax asset (4,700)
Net cash (used) provided by operating (188,400) 286,300
activities
Cash flows from investing activities:
Additions to property and equipment (15,900) (8,100)
Net cash used by investing activities (15,900) (8,100)
Cash flows from financing activities:
Issuance of stock 399,400 7,100
Net cash provided by financing 399,400 7100
activities
Net increase in cash 195,100 285,300
Cash at beginning of period 285,300
Cash at end of period $480,400 $ 285,300
Supplemental disclosure of cash flow information:
Cash paid for income taxes $4,700
Schedule of noncash activities:
Contribution of assets (Note 2):
Property and equipment $15,500
Accounts receivable 3,200
Intercompany receivables 700
Additional paid in capital $19,400
In May, 2000, the Company issued 214,918 shares of
restricted common stock to Campbell Mello Associates for
services rendered.
The Notes to Financial Statements are an
integral part of these statements.
-F5-
OneCap
NOTES TO FINANCIAL STATEMENTS
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMBER
31,1999
1. Summary of significant accounting policies:
Organization and nature of business:
OneCap (the "Company") was incorporated in the State of
Nevada on June 7, 1999 to serve as a loan and real
estate broker for residential and commercial loan and
real estate transactions. Tile majority of the Company's
revenues are derived from doing business with related
entities. The Company is authorized to issue 20,000,000
shares of common stock with a par value of $.001 and
5,000,000 shares of preferred stock with a par value of
$.001.
In June, 1999, the Company issued 100 shares of common
stock, no par value, in exchange for cash and other
assets totaling $19,600. (See note 2). On November 1,
1999, the Articles of Incorporation were amended to
increase the number of authorized shares of Common Stock
to 20,000,000 with a par value of $.001 and to authorize
5,000,000 shares of Preferred Stock with a par value of
$.001. On November 2, 1999, the 100 shares of Common
Stock outstanding with no par value were exchanged for
100 shares of Common Stock with a par value of $.001 and
an additional 6,937,400 shares of Common Stock with a
par value of $.001 were issued for $6,900.
In May, 2000, the Company issued an additional 1,659,200
shares of common stock with a par value of $.001 through
an offering in the State of Nevada. The stock was
offered at $.25 per share and the maximum shares of the
offering was 2,000,000 shares.
In May, 2000, the Company issued 214,918 restricted
shares of common stock to Campbell Mello Associates
("CMA") with a par value of $.001 through a private
transaction for services rendered. The stock was offered
at $.25 per share for an aggregate total of $53,700. The
private transaction is pursuant to Section 4(2) of the
Securities Act of 1933.
There have been no other issuances of common or
preferred stock.
The Company uses the accrual method of accounting. The
Company has adopted December 31 as its fiscal year end.
Organization costs:
The Company's policy is to amortize organizational
expenditures using the straight-line method over five
years.
Earnings per share:
Earnings per share was computed by dividing the net
income by the weighted average number of common shares
outstanding.
-F6-
OneCap
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMBER
31,1999
1. Summary of significant accounting policies (continued):
Use of estimates in preparation of financial statements:
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.
Advertising costs:
Advertising costs are charged to expense as incurred.
Advertising expenses were $53,000 and $0 for the five
months ended May 31, 2000 and for the period from June
7, 1999 (inception) to December 31, 1999.
Recognition of loan origination fees:
Loan origination fees are recognized upon the closing of
a loan, which occurs after all significant services have
been performed.
Income taxes:
Effective November 5, 1999, the Company revoked its S
election and elected not to have the pro rata allocation
of S corporation items under IRC Section 1362 (e)(2)
apply to the S termination year. Prior to November 5,
1999, the Company was treated as an S Corporation for
Federal income tax purposes. As an S Corporation, the
Company passes through the taxable income and losses to
its stockholders each year as recognized, and thus pays
no corporate income tax itself.
Property and equipment:
Property and equipment is stated at cost less accumulated
depreciation. Depreciation is provided principally on
the accelerated and straight-line methods over the
estimated useful lives of the assets.
The cost of maintenance and repairs is charged to expense
as incurred. Expenditures for property betterments and
renewals are capitalized. Upon sale or other disposition
of depreciable property, cost and accumulated
depreciation are removed from the accounts and any gain
or loss is reflected in income.
-F7-
OneCap
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMEBER
31,1999
2. Related party transactions:
a. Revenues:
The majority of the Company's revenues are derived
from commercial loan closings for related entities in
which one stockholder has an ownership interest and
loans processed for buyers in Southern Nevada who
purchase homes developed by Pacific Homes and other
related entities under common control.
b. Accounts payable, related parties:
Accounts payable, related parties are amounts due to
Pacific Properties and Development, LLC and Builders
Realty, Inc., companies under common control, for
operating expenses paid on the Company's behalf. The
amounts are unsecured, non-interest bearing and due
on demand.
c. Office space:
The Company leases office space from an affiliated
partnership on a month-to-month basis. The total rent
paid for office space was $20,000 and $19,300 during
the five months ended May 31, 2000 and for the period
from June 7, 1999 (inception) to December 31, 1999,
respectively.
d. Contribution of assets:
During the period ended December 31, 1999, one
stockholder of the Company contributed net assets
totaling $19,600 to the Company as follows:
Petty Cash $200
Accounts 3,200
Receivable
Furniture and 15,500
Equipment
Intercompany 700
Receivables
$19,600
-F8-
OneCap
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMBER
31,1999
3. Income taxes:
The provision for federal income taxes differs from that
computed by applying federal statutory rates to income
before federal income tax expense, as indicated in the
following analysis:
Period Period
Ended May Ended
31, 2000 December
31, 1999
Expected tax provision at 15 % and 22% $ $25,500
Tax on income prior to revocation of (21,800)
S-election
Net operating loss carry forwards/back (7,800)
applied
Increase in valuation allowance 3,100
$(4700) $3,700
Deferred tax assets have been provided for net operating
losses expiring in 2015.
As of May As of
31, 2000 December
31, 1999
Deferred tax asset $7,800 $
Deferred tax asset valuation (3,100)
allowance
Net deferred tax asset $ 4,700 $
4. Property and equipment:
Property and equipment at May 31, 2000 and December 31,
1999 consisted of the following:
As of May As of
31, 2000 December
31, 1999
Computer equipment $26,700 $10,800
Computer software 4,900 4,900
Furniture and equipment 7,800 7,800
39,400 23,500
Less accumulated depreciation 7,100 3,200
$32,300 20,300
Depreciation expense for the five months ended May 31,
2000 and for the period from June 7, 1999
(inception) to December 31, 1999 was $3,900 and $3,200,
respectively.
-F9-
OneCap
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
FOR THE FIVE MONTHS ENDED MAY 31, 2000 AND
FOR THE PERIOD FROM JUNE 7,1999 (INCEPTION) TO DECEMBER
31,1999
5. Commitments and contingencies:
Concentration of credit risk:
In the normal course of business, the Company maintains
cash at a financial institution in excess of federally
insured limits.
Employee benefit plan:
The Company adopted a retirement savings plan for its
employees under Section 401(k) of the Internal Revenue
Code. The plan allows employees of the Company to defer
up to the lesser of the Internal Revenue Code prescribed
maximum amount or 15% of their income on a pre-tax basis
through contributions to the plan. The Company matches
25% of eligible employees' contributions up to a maximum
of 6% of their individual earnings.
6. Stockholders' equity:
Restricted shares of common stock:
7,356,418 of the total shares of common stock outstanding
are restricted.
Preferred stock:
The Board of Directors has the authority to issue the
preferred stock, the terms of which (including, without
limitation, dividend rates, conversion rights, voting
rights, terms of redemption and liquidation
preferences) may be fixed by the Board at its sole
discretion. The holders of the Company's common stock
will not be entitled to vote upon such matters. No
shares of preferred stock of any series are outstanding
and the Board of Directors has no present intention to
issue any such shares. Shares of preferred stock issued
in the future could have conversion rights, which may
result in the issuance of additional shares of common
stock, which could dilute the interest of the holders
of common stock. Such shares could also have voting
rights and liquidation preferences which are senior to
the rights and preferences of the common stock.
Additionally, such shares could have dividend,
redemption or other restrictive provisions.
Warrants and options:
There are no warrants or options outstanding to acquire
any additional shares of common stock.
-F10-
**********************************************************************
Part III
Item 1. Index to Exhibits
Exhibit Name and/or Identification of Exhibit
Number
3 Articles of Incorporation & By-Laws
a. Articles of Incorporation of the Company filed June 7, 1999
b. By-Laws of the Company adopted June 7, 1999
10 Material Contracts
a. Client Information Form/Agreement with Factual Data of
Nevada, signed April 18, 2000
b. Service Agreement with Executive Reporting Services, signed
September 15, 1999
c. Mortgage Broker Agreement with Fleet Mortgage Corporation,
signed October 1, 1999
d. Broker Agreement with Greenpoint Mortgage Funding, Inc.,
signed February 25, 2000
e. Wholesale Lending Agreement with Interfirst, a division of
ABN Amro Mortgage Corporation, signed October 8, 1999
f. Loan Broker Agreement with Irwin Mortgage Corporation,
signed October 14, 1999
g. Broker Agreement with North American Mortgage Company, signed
March 3, 2000
h. Advertising Agreement with "The House Detective," dated
December 20, 1999
i. Advertising Agreement with "The Home Show," dated February
10, 2000
j. Advertising Agreement with "Here is Las Vegas," dated
October 13, 1999
k. Advertising Agreement with "Southern Nevada Homes Magazine,"
dated April 5, 2000
l. Advertising Agreement with the Las Vegas Chamber of Commerce
Relocation Guide, dated May 22, 2000
m. Advertising Agreement with "Homes and Living," dated February
9, 2000
n. Sublease Agreement with Sierra Pacific Energy Corporation,
dated July 9, 2000
23 Consent of Experts and Counsel
Consents of independent public accountants
27 Financial Data Schedule
Financial Data Schedule of OneCap ending May 31, 2000
-24-
99 Additional Exhibits
Stock Option Plan adopted by the Board of Directors on July 27,
2000
-25-
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of
1934, the registrant caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized.
OneCap
(Registrant)
Date: August 10, 2000
By: /s/ Vincent W. Hesser
Vincent W. Hesser, President
-26-
