UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT FOR THE
TRANSITION PERIOD FROM _________ TO _____________.
COMMISSION FILE NUMBER: 000-30607
WELLNESSAMERICA ONLINE, INC.
____________________________________________________
(Exact name of small business issuer as specified in its charter)
SONTECH, INC.
___________________________________________________
(Former name of small business)
NEVADA 87-0455378
_________________________ __________________________
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
4241 EAST CLINTON AVENUE, CA 93703
__________________________________________________________________
(Address of principal executive offices)
68 SOUTH MAIN # 708, SALT LAKE CITY, UT 84101
__________________________________________________________________
(Former address of principal executive offices)
(559) 449-2616
(Issuer's telephone number)
(801) 531-7558
__________________________________________________________________
(Issuer's former telephone number)
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
As of November 1, 2000, the issuer had outstanding 34,071,975 shares of Common
Stock, par value $0.001 per share.
Transitional Small Business Disclosure Format (Check one): Yes [ ] No [X]
<PAGE>
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The unaudited financial statements of WellnessAmerica Online, Inc., a Nevada
corporation (the "Company"), as of September 30, 2000, were prepared by Randy
Simpson CPA PC, Certified Public Accountants, and commence on the following
page. In the opinion of Management, the financial statements fairly present
the financial condition of the Company.
<PAGE>
WellnessAmerica Online, Inc.
(Formerly Sontech, Inc.)
BALANCE SHEETS
(Unaudited)
ASSETS
September 30, December 31,
2000 1999
------------- --------------
Current Assets:
Cash $ - $ -
------------- --------------
Total current assets - -
Other Assets:
Organization costs 5,490 5,490
Accumulated amortization (2,379) (1,556)
------------- --------------
Net organizational costs 3,111 3,934
Website development cost - Triunified Health
Enhancement Systems, Inc. merger (asset
returned upon rescission of merger on
January 28, 2000) - 5,000
Investment in WHY USA Financial Group, Inc. - 1,000
------------- --------------
Total Assets $ 3,111 $ 9,934
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Shareholders' Equity
Common stock - authorized 50,000,000 shares
at a $0.01 par value,12,222,525 shares issued
and outstanding at September 30,2000,
17,222,525 at December 31,1999 12,223 17,223
Additional paid in capital 414,040 414,040
Accumulated Deficit (423,152) (421,329)
------------- --------------
Total Shareholders' Equity 3,111 9,934
------------- --------------
Total Liabilities and Shareholders' Equity $ 3,111 $ 9,934
============= ==============
See accompanying notes to financial statements.
<PAGE>
WellnessAmerica Online, Inc.
(Formerly Sontech, Inc.)
STATEMENT OF OPERATIONS
(Unaudited)
9 Months 9 Months 3 Months 3 Months
Ended Ended Ended Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2000 1999 2000 1999
------------ ------------ ------------ -----------
Income:
Gain on sale of WHY USA
stock $ 19,000 $ - $ 19,000 $ -
------------ ------------ ------------ -----------
19,000 - 19,000 -
Operating Expense:
Office and administrative
expenses $ 1,023 $ - $ - $ -
Professional fees 18,977 - 7,553 -
Amortization of
organizational costs 823 823 275 275
------------ ------------ ------------ -----------
Total Operating Expense 20,823 823 7,828 275
------------ ------------ ------------ -----------
Net Loss $ ( 1,823) $ (823) $ 11,172 $ (275)
============ ============ ============ ===========
Net Loss per Common share $ (0.000) $ 0.000 $ 0.001 $ 0.000
============ ============ ============ ===========
Weighted Average Shares
Common Stock Outstanding 12,222,525 17,222,525 12,222,525 17,222,525
============ ============ ============ ===========
See accompanying notes to financial statements.
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<TABLE>
<CAPTION>
WELLNESSAMERICA ONLINE, INC.
(Formerly Sontech, Inc.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
From January 1, 1998 through September 30, 2000
Total
Common Paid-in Accumulated Stockholders
Shares Stock Capital Deficit Equity
------------- --------- ------------ ----------- ------------
<S> <C> <C> <C> <C> <C>
Balances at January 1, 1998 18,953,340 $ 18,955 $ 395,606 $ (413,561) $ 1,000
Reverse split of stock- 2 for 1,
change of domicile to Nevada
from Utah (9,476,670) (9,477) 9,477 - -
Shares issued for legal fees
incurred in connection with
redomicile of corporation,
valued at $.02 per share 2,745,855 2,745 2,745 - 5,490
Net loss for the year ended
December 31, 1998 - - - (5,095) (5,095)
------------- --------- ------------ ----------- ------------
Balances at December 31, 1998 12,222,525 12,223 407,828 (418,656) 1,395
Advances by shareholders
reclassified from payables in
1998, to paid in capital
in 1999 - - 4,637 - 4,637
Expenses in 1999 advanced by
stockholders and classified as
paid in capital - - 1,575 - 1,575
Merger with Triunified on April
19, 1999- subsequently rescinded
on January 28, 2000 5,000,000 5,000 - - 5,000
Net loss for the year ended
December 31, 1999 - - - (2,673) (2,673)
------------- --------- ------------ ----------- ------------
Balances at December 31, 1999 17,222,525 17,223 414,040 (421,329) 9,934
Recission of merger with
Triunified on January 28, 2000 (5,000,000) (5,000) - - (5,000)
Net loss for the nine months
ended September 30, 2000 - - - (1,823) (1,823)
------------- --------- ------------ ----------- ------------
Balances at September 30, 2000 12,222,525 $ 12,223 $ 414,040 $ (423,152) $ 3,111
============= ========= ============ =========== ============
See accompanying notes to financial statements.
</TABLE>
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<TABLE>
<CAPTION>
WellnessAmerica Online, Inc.
(Formerly Sontech, Inc.)
STATEMENT OF CASH FLOWS
(Unaudited)
9 Months 9 Months
Ended Ended
Sept. 30, 2000 Sept. 30, 2000
--------------- ---------------
<S> <C> <C>
Cash used in operating activities:
Net Loss $ (1,823) $ (823)
Adjustments to reconcile net loss to cash flow
used in operations:
Amortization of organizational costs 823 823
Book value of investments sold 1,000 -
--------------- ---------------
Cash flows from operating activities - -
Net cash flows - -
Cash flows used in financing activities as
liabilities in 1999:
Advances from stockholders- repaid via
stock transfer - -
--------------- ---------------
Cash flows from financing activities - -
--------------- ---------------
Net change in cash and cash equivalents - -
Cash and cash equivalents at beginning of period - -
--------------- ---------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ - $ -
=============== ===============
No cash paid for interest or income taxes $ - $ -
=============== ===============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
WellnessAmerica Online, Inc.
(Formerly Sontech, Inc.)
NOTES TO FINANCIAL STATEMENTS
1. UNAUDITED FINANCIAL STATEMENTS:
The unaudited financial statements for the nine months ended September
30, 2000, have been prepared pursuant to the rules and regulations of the
Securities and Exchange Commission (SEC). Certain information and note
disclosures normally included in annual financial statements prepared in
accordance with generally accepted accounting principles have been omitted
pursuant to those rules and regulations, although the Company believes that
the disclosures made are adequate to make the information presented not
misleading. In the opinion of management, all adjustments necessary for a
fair presentation of results of operations have been made to the interim
financial statements. Results of operations for the nine month period ended
September 30, 2000 are not necessarily indicative of results of operations for
the respective full years.
A summary of the Company's significant accounting policies and other
information necessary to understand these financial statements for its third
quarter ended September 30, 2000, is presented in the Company's audited
financial statements for the year ended December 31, 1999. Accordingly, the
Company's audited financial statements for its year ended December 31, 1999,
as contained in the Company's Form 10SB, should be read in connection with
these financial statements.
ORGANIZATION COSTS
Legal, filing fees, printing, accounting and other reorganization costs
were capitalized and amortized over sixty months These costs were incurred pre
1999 and were not required to be expensed as Statement of Position 98-5
requires for all organizational expenses incurred after December 15, 1998.
INTANGIBLES
Start-up costs and research and development costs are charged to the
expense in the period incurred.
INCOME TAXES
The Company accounts for income taxes under the provisions of SFAS No.
109, Accounting for Income Taxes (SFAS No. 109). The Company has no
significant differences between its income tax and financial accounting. The
Company has approximately $420,000 in loss carryforwards to offset future
taxable income. The loss carryforward begins to expire in 2003. The Company
has not recognized any a deferred tax for the loss carryforward due to the
uncertainty of its realization.
NET LOSS PER SHARE
Net loss per share is based on the weighted average shares outstanding of
14,000,000 on December 31, 1999. No significant loss per share (less than
$.01 per share) has been calculated. Subsequent to December 31, 1999, the
Company cancelled 5,000,000 shares in connection with the rescission of the
merger with Triunified Health Enhancement Systems, Inc.
MERGER WITH WELLNESSAMERICA.COM CORPORATION
On October 17, 2000, a special meeting of the shareholders of Sontech, Inc.
was held to approve the merger of Sontech, Inc. and WellnessAmerica.Com
Corporation. In connection with the merger, Sontech, Inc. changed its name to
WellnessAmerica Online, Inc. The shareholders of WellnessAmerica.Com
Corporation received 21,849,450 shares of WellnessAmerica Online, Inc.
(Formerly Sontech, Inc.). The officers and directors of WellnessAmerica.Com
effectively took control of the Company and elected a new board of directors
and officers of the Company. As a result of the reorganization,
WellnessAmerica Online's principal offices will be relocated to 4241 East
Clinton Avenue, Fresno, CA 93703. The Company's total outstanding shares will
be 34,071,975. The Company will account the transaction as a reverse
acquisition. The assets of WellnessAmerica.Com Corporation will be reflected
on their historical cost basis and no good will will be recognized in the
merger. The Company does not currently have available the information to
prepare a proforma financial statement of the combined entities.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Plan of Operation.
As a result of the Reorganization wherein the Company acquired
WELLNESSAMERICA.COM CORPORATION as described in Part II, Item 2 hereof, the
Company adopted a new business plan outlined below.
Product
-------
The foundation of the Company's current and future products is the
Complementary Alternative Medicine database, which continues to expand as new
research is added daily. The database allows the Company to deliver fast,
convenient access to alternative remedies and to generate e-commerce revenue
relating to 704 diseases, 387 herbs and 71 trace materials. These protocols
contain the references for dosage amounts obtained from a research base of
over 20,000 studies published in the last decade and are updated daily.
The Company has sufficient cash to continue operations and perform its
business plan for six to twelve months without generating any revenue or
raising any additional investment capital. The Company currently has 32
employees and does not expect to add significantly to this total in the
foreseeable future.
Technology
----------
The Company intends to apply for patents for its unique methodology, which
will serve as a barrier to entry, and force competitors to become allies,
partners, or customers. The Company intends to out-perform all present and
future content sites in the health care field. In addition to keeping the
leading edge content of the site, the Company's plans include creating
strategic alliances with insurance companies, hospitals, health care vendors,
churches, vitamin and drug manufacturers and health care practitioners to
provide further value for consumers.
The Company's e-health content is based upon the unique Alternative Health
Grid Matrix Technology that the Company intends to patent. The uniqueness of
this matrix is the horizontal human anatomy; each organ is virtually
integrated horizontally from one single button to each of the 15 alternative
healing modalities. In addition, each modality is supported by references
from leading medical literature, not eastern philosophy.
The Company has combined this system with the body-organ to disease-organ
architecture to create a duplicatable, repeatable engine for every other
modality. By linking the organ location for the modality and repeating the
image, the Company's system links 704 disease searches to one data
encyclopedia. Pre-selected search queries provide three to four hours of
research in just three to five seconds.
The continued enhancement of the Company's product includes updating all 15
disciplines daily; creating two million Internet customers via strategic
alliances; positioning the Company's Web site as the number one alternative
health site on the Internet; and acquiring small competitors.
Marketplace
-----------
The Company believes that the health care delivery system is in the midst of a
dramatic paradigm shift. Mainstream medical journals are now acknowledging as
pioneers the same scientists whose works just a decade ago were being labeled
by such medical journals as unproven and fraudulent.
The Company believes that the United States is in a revolutionary time for
alternative medicine. Research reports dramatically prove this point.
Consumers of health care today are demanding information, choices and
alternatives to drugs and surgery. The traditional medical approach divides
the body into parts separate organs, specialties and sub-specialties. The
holistic approach reconnects the systems, reunites body, mind and spirit
energy, reintroduces and supports non-invasive, natural healing methods and
reeducates medical practitioners on the importance of the central nervous
system to health.
Dr. David Eisenberg of Harvard Medical School published the results of his
national survey entitled "Trends in Alternative Medicine Use in the United
States" in the Journal of the American Medical Association (JAMA) in November
1998. Dr. Eisenberg found that the percentage of adults who used alternative
medicine increased from 34% in 1990 to 42% in 1997; visits to alternative
medicine practitioners increased from 427.1 million in 1990 to 628.8 million
in 1997; and total spending on alternative medicine increased from $14.6
billion in 1990 to $21.2 billion in 1997.
The Company's Chairman, Mr. Tariq Faridi has experienced huge success with his
database, providing doctors all over the world with research currently not
found in any other format. The Company anticipates that greater success lies
ahead with the growing use of the Internet worldwide.
Competition
-----------
The Company is aware of at least 1100 potential competitors in the alternative
medicine market. However, no competitive Web site offers all 15 disciplines
navigable from a single disease. Reader'' Digest and Johnson and Johnson have
allocated over 200 million dollars each to create alternative health portals.
AOL has granted the Company exclusive space on AOL's Instant Messenger, new
member welcome message and search position, as well as e-zine partnership.
AOL and other major Internet players have inquired as to the Company's
availability as a content provider.
The Company believes that its product is superior to any competitor's product
because other products require the user to write a question to receive an
answer. The Company has archived questions regarding 704 diseases with one to
three key questions pre-searched. No competitor provides the depth of
articles provided by the Company or offers all-in-one availability to answer
all questions in one place.
PART II OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Change in Securities.
On October 17, 2000, a special meeting of the shareholders of Sontech, Inc., a
Nevada corporation ("Sontech"), was held in Salt Lake City, Utah. The
shareholders of Sontech approved an Agreement and Plan of Reorganization (the
"Reorganization Agreement") between Sontech and WELLNESSAMERICA.COM
CORPORATION, a Delaware corporation ("WAC"), whereby WAC was acquired by
Sontech and Sontech changed its name to WellnessAmerica Online, Inc. and the
shareholders of WAC received 21,849,450 shares of the Company.
The 21,849,450 shares of the Company's common stock issued pursuant to this
Reorganization were issued pursuant to exemption from registration under the
Securities Act of 1933, as amended (the "Securities Act") pursuant to Section
4(2) of the Securities Act.
Item 3. Defaults Upon Senior Securities.
None.
Item 4. Submission of Matters to a Vote of Securities Holders.
A special meeting (the "Special Meeting") of the Company's shareholders was
held on October 17, 2000, in Salt Lake City, Utah, to approve the
Reorganization Agreement. At the Special Meeting, Tariq Faridi, Dr. Rhett
Hall, Barbara Spengler, Stanley Greenberg, and Hiroshi Watanabe were each
elected as directors of the Company. As of the date of the Special Meeting,
12,222,225 shares of the Company were entitled to approve the Reorganization
Agreement and elect the new directors of the Company, of which 10,427,690
voted to approve the Reorganization Agreement and to elect each new director
of the Company. No votes were cast in opposition of either the Reorganization
Agreement or any of the new directors of the Company.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
On November 1, 2000, the Company filed a report on Form 8-K relating to the
Reorganization Agreement.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Dated: November 13, 2000 WELLNESSAMERICA ONLINE, INC.
/S/ TARIQ FARIDI
By:__________________________________
TARIQ FARIDI
Chairman, Chief Executive Officer
and President
