EXHIBIT 4.1
Offering Memorandum Confidential
Dated September 10, 1996
L W Global (U.S.A.), Inc.
(A Delaware Corporation)
1,200, 000 Shares
At a Price of $.01 Per Share
L W Global (U.S.A.), Inc., a Delaware corporation (the "Company"), is a
company which is in the office supply, equipment and maintenance business.
The Company's principal office is located at 222 Lakeview Avenue, Suite
160-124, West Palm Beach, FL 33401.
AN INVESTMENT IN THE COMPANY IS SPECULATIVE AND INVOLVES A HIGH DEGREE OF
RISK. INVESTMENT IN THE SECURITIES OFFERED HEREBY IS SUITABLE ONLY FOR PERSONS
OF SUBSTANTIAL FINANCIAL MEANS WHO CAN AFFORD A TOTAL LOSS OF THEIR INVESTMENT
AND WILL BE SOLD ONLY TO ACCREDITED OR OTHERWISE QUALIFIED INVESTORS. FOR A
DISCUSSION OF THE MATERIAL RISKS IN CONNECTION WITH THE PURCHASE OF THE SHARES,
SEE "INVESTMENT RISK CONSIDERATIONS".
The SECURITIES ARE BEING OFFERED WITHOUT REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (The "ACT"), IN RELIANCE UPON The EXEMPTION FROM
REGISTRATION AFFORDED BY SECTIONS 4(2) AND 3(b) OF The SECURITIES ACT AND
REGULATION D PROMULGATED THEREUNDER.
THIS MEMORANDUM HAS NOT BEEN REVIEWED OR APPROVED OR DISAPPROVED, NOR HAS The
ACCURACY OR ADEQUACY OF THE INFORMATION SET FORTH HEREIN BEEN PASSED UPON BY The
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES ADMINISTRATOR. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THIS OFFERING IS BEING
MADE PURSUANT TO THE EXEMPTIONS AFFORDED BY SECTIONS 4(2) OR 3(b) OF THE
SECURITIES ACT OF 1933 AND RULE 504 OF REGULATION D PROMULGATED THEREUNDER AND
STATE SMALL CORPORATE OFFERING REGISTRATION PROVISIONS. PURSUANT TO RULE 504,
THE SHARES SOLD HEREBY WILL NOT BE SUBJECT TO ANY LIMITATIONS ON RESALE THEREOF
UNDER FEDERAL LAW. THE SHARES MAY, HOWEVER, BE SUBJECT TO LIMITATIONS ON THE
OFFER AND SALE AND THE RESALE OF THE SHARES IMPOSED BY The BLUE SKY LAWS OF
INDIVIDUAL STATES. IN ADDITION, The COMPANY INTENDS TO FILE THE REQUIRED
DOCUMENTS IN CERTAIN OTHER STATES IDENTIFIED BY MANAGEMENT AS HAVING POSSIBLE
INVESTOR INTEREST AND USE ITS BEST EFFORTS TO QUALIFY The SHARES FOR SECONDARY
TRADING IN SUCH STATES, THOUGH NO ASSURANCE CAN BE GIVEN THAT IT WILL BE ABLE TO
QUALIFY The SHARES FOR SECONDARY TRADING IN ANY SUCH STATES IN WHICH IT SUBMITS
1
<PAGE>
SUCH APPLICATIONS AND DOCUMENTS. AN INABILITY TO QUALIFY The SHARES FOR
SECONDARY TRADING WILL CREATE SUBSTANTIAL RESTRICTION ON The TRANSFERABILITY OF
SUCH SHARES WHICH MAY NEGATE The BENEFIT OF The EXEMPTION PROVIDED BY RULE 504
OF REGULATION D. SEE "RISK FACTORS." THE COMPANY WILL USE ITS BEST EFFORTS TO
CAUSE The SHARES TO BE LISTED ON THE ELECTRONIC BULLETIN BOARD OPERATED BY The
NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. AS A MARKET IN WHICH THEY MAY
BE TRADED. THERE IS NO ASSURANCE THAT SUCH LISTING WILL BE OBTAINED OR THAT IF A
LISTING IS OBTAINED THAT ANY MARKET FOR THE SHARES WILL DEVELOP, OR IF
DEVELOPED, THAT IT WILL BE SUSTAINED.
----------------------------------------------------------------
Subscription Proceeds to the
Price Commissions(1) Company
Per Share $0.01 $ -0- $ 12,000
----------------------------------------------------------------
(1) The Shares are being sold by the Company's sole Officer and no commissions
will be paid in connection with the Offering.
L W Global (U.S.A.), Inc.
222 Lakeview Avenue
Suite 160-124
West Palm Beach, FL 33401
(407) 833-5092
2
<PAGE>
CONFIDENTIAL INFORMATION
THE INFORMATION CONTAINED IN THIS OFFERING MEMORANDUM IS CONFIDENTIAL AND
PROPRIETARY TO THE COMPANY AND IS BEING SUBMITTED TO PROSPECTIVE INVESTORS IN
THE COMPANY SOLELY FOR SUCH INVESTORS' CONFIDENTIAL USE WITH THE EXPRESS
UNDERSTANDING THAT, WITHOUT THE PRIOR WRITTEN PERMISSION OF THE COMPANY, SUCH
PERSONS WILL NOT RELEASE THIS DOCUMENT OR DISCUSS THE INFORMATION CONTAINED
HEREIN OR MAKE REPRODUCTIONS OF OR USE THIS OFFERING MEMORANDUM FOR ANY PURPOSE
OTHER THAN EVALUATING A POTENTIAL INVESTMENT IN THE SHARES.
A PROSPECTIVE INVESTOR, BY ACCEPTING DELIVERY OF THIS OFFERING MEMORANDUM,
AGREES PROMPTLY TO RETURN TO THE COMPANY THIS OFFERING MEMORANDUM AND ANY OTHER
DOCUMENTS OR INFORMATION FURNISHED IF THE PROSPECTIVE INVESTOR ELECTS NOT TO
PURCHASE ANY OF THE SHARES OFFERED HEREBY.
THE INFORMATION PRESENTED HEREIN WAS PREPARED BY THE COMPANY IS BEING
FURNISHED BY THE COMPANY SOLELY FOR USE BY PROSPECTIVE INVESTORS IN CONNECTION
WITH THE OFFERING NOTHING CONTAINED HEREIN IS, OR SHOULD BE RELIED ON AS A
PROMISE OR REPRESENTATION AS TO THE FUTURE PERFORMANCE OF THE COMPANY.
THIS OFFERING MEMORANDUM DOES NOT PURPORT TO BE ALL-INCLUSIVE OR TO CONTAIN
ALL THE INFORMATION THAT A PROSPECTIVE INVESTOR MAY DESIRE IN INVESTIGATING THE
COMPANY. EACH INVESTOR MUST CONDUCT AND RELY ON ITS OWN EVALUATION OF THE
COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED.
IN MAKING AN INVESTMENT DECISION WITH RESPECT TO THE SHARES SEE "RISK FACTORS"
FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION WITH
THE PURCHASE OF SHARES.
THIS OFFERING MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE SHARES IN ANY JURISDICTION WHERE, OR TO ANY
PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH
JURISDICTION. EXCEPT AS OTHERWISE INDICATED, THIS OFFERING MEMORANDUM SPEAKS AS
OF THE DATE HEREOF. NEITHER THE DELIVERY OF THIS OFFERING MEMORANDUM NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY AFTER THE DATE HEREOF.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OTHER THAN THAT
CONTAINED IN THIS OFFERING MEMORANDUM, OR TO MAKE ANY REPRESENTATIONS IN
CONNECTION WITH THE OFFERING MADE HEREBY, AND, FI GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY. THE COMPANY DISCLAIMS IN, OR OMISSION FROM, THIS OFFERING
MEMORANDUM OR ANY OTHER WRITTEN OR ORAL COMMUNICATION TRANSMITTED OR MADE
AVAILABLE TO THE RECIPIENT.
3
<PAGE>
FOR RESIDENT OF ALL STATES:
THE SHARES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE
ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND SUCH
LAWS. THE SHARES ARE SUBJECT TO RESTRICTIONS ON THE TRANSFERABILITY AND RESALE
AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES
ACT AND SUCH LAWS PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. THE SHARES
HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION. ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY
AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE
MERITS OF THIS OFFERING OR THE ACCURACY OR ADEQUACY OF THIS OFFERING MEMORANDUM.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
4
<PAGE>
NOTICES TO PROSPECTIVE INVESTORS
THIS OFFERING MEMORANDUM IS SUBMITTED IN CONNECTION WITH THE OFFERING OF
THE SHARES AND MAY NOT BE REPRODUCED OR USED FOR ANY OTHER PURPOSE. BY ACCEPTING
DELIVERY OF THIS OFFERING MEMORANDUM, EACH RECIPIENT AGREES TO RETURN THIS
OFFERING MEMORANDUM AND ALL OTHER DOCUMENTS IF THE RECIPIENT DOES NOT AGREE TO
PURCHASE ANY OF THE SHARES TO THE COMPANY AT ITS ADDRESS LISTED ON THE COVER OF
THE OFFERING MEMORANDUM.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON THE TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED BY THE
SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS.
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM, INVESTORS SHOULD BE AWARE THAT
THEY WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN
INDEFINITE PERIOD OF TIME.
IN MAKING AN INVESTMENT DECISION, INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE PERSON OR ENTITY CREATING THE SECURITIES AND THE TERMS OF THE
OFFERING, INCLUDING THE MERITS AND RISKS INVOLVED. THESE SECURITIES HAVE NOT
BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES COMMISSION OR REGULATORY
AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
THIS OFFERING MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO PURCHASE SHARES TO ANY PERSON IN ANY STATE OR IN ANY
JURISDICTION IN WHICH SUCH AN OFFER OR SOLICITATION IS UNLAWFUL, SUBJECT TO THE
PRECEDING SENTENCE. THIS OFFERING MEMORANDUM IS INTENDED FOR THE EXCLUSIVE USE
OF THE PERSON TO WHOM IT IS DELIVERED BY AN AUTHORIZED AGENT OF THE COMPANY ON
BEHALF OF THE COMPANY.
PROSPECTIVE INVESTORS ARE NOT TO CONSTRUE THE CONTENTS OF THIS CONFIDENTIAL
OFFERING MEMORANDUM OR ANY PRIOR OR SUBSEQUENT COMMUNICATIONS AS LEGAL, TAX OR
INVESTMENT ADVICE. EACH INVESTOR SHOULD CONSULT HIS OWN COUNSEL, ACCOUNTANT OR
BUSINESS ADVISOR AS TO LEGAL, TAX AND RELATED MATTERS COVERING HIS INVESTMENT.
THE SHARES ARE OFFERED SUBJECT TO THE ACCEPTANCE BY THE COMPANY OF OFFERS
BY PROSPECTIVE INVESTORS, ALLOCATION OF SHARES BY THE COMPANY AND OTHER
CONDITIONS SET FORTH HEREIN. THE COMPANY MAY REJECT ANY OFFER IN WHOLE OR IN
PART AND NEED NOT ACCEPT OFFERS IN THE ORDER RECEIVED.
5
<PAGE>
THIS CONFIDENTIAL OFFERING MEMORANDUM DOES NOT CONTAIN AN UNTRUE STATEMENT
OF A MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY TO MAKE THE
STATEMENTS MADE IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT
MISLEADING. IT CONTAINS A FAIR SUMMARY OF THE MATERIAL TERMS AND DOCUMENT
PURPORTED TO BE SUMMARIZED HEREIN.
THE SHARES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF CERTAIN STATES AND ARE BEING
OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
SAID ACT AND SUCH LAWS. THE SHARES UNDERLYING THE SHARES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD
EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS PURSUANT TO REGISTRATION OR
EXEMPTION THEREFROM. THE SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY
OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING
OR THE ACCURACY OR ADEQUACY OF THE OFFERING MEMORANDUM. ANY REPRESENTATION TO
THE CONTRARY IS UNLAWFUL.
THE SUBSCRIPTION PRICE FOR THE SHARES IS PAYABLE IN FULL UPON SUBSCRIPTION.
THE OFFERING PRICE WAS DETERMINED ARBITRARILY BY THE COMPANY AND BEARS NO
RELATIONSHIP TO ASSETS, EARNINGS, BOOK VALUE OR ANY OTHER CRITERIA OF VALUE. NO
REPRESENTATION IS MADE THAT THE SHARES HAVE MARKET VALUE OF, OR COULD BE RESOLD
AT, THAT PRICE (SEE "RISK FACTORS," "DILUTION," AND "USE OF PROCEEDS).
THE SHARES WILL BE OFFERED BY THE COMPANY ON A BEST EFFORTS BASIS TO A
SELECT GROUP OF INVESTORS WHO MEET CERTAIN SUITABILITY STANDARDS. NO COMMISSIONS
AND NO NON-ACCOUNTABLE OR ACCOUNTABLE EXPENSE ALLOWANCE OF ANY KIND WILL BE PAID
FROM OR DEDUCTED FROM THE PROCEEDS RAISED HEREBY. THE COMPANY WILL ABSORB ALL
MARKETING EXPENSES ASSOCIATED WITH THIS OFFERING 9SEE "USE OF PROCEEDS").
THE COMPANY HAS AGREED TO PROVIDE, PRIOR TO THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED HEREIN, TO EACH POTENTIAL PURCHASER OF SECURITIES (OR
HIS REPRESENTATIVES) OR BOTH) THE OPPORTUNITY TO ASK QUESTIONS OF, AND RECEIVE
ANSWERS FROM, THE COMPANY OR ANY PERSON ACTING ON ITS BEHALF CONCERNING THE
TERMS AND CONDITIONS OF THIS OFFERING AND TO OBTAIN ANY ADDITIONAL INFORMATION,
TO THE EXTENT THEY POSSESS SUCH INFORMATION OR CAN ACQUIRE IT WITHOUT
UNREASONABLE EFFORT OR EXPENSE NECESSARY TO VERIFY THE ACCURACY OF THE
INFORMATION SET FORTH HEREIN.
THIS OFFERING MEMORANDUM DOES NOT CONSTITUTE AN OFFER TO ANY PERSON WHO
DOES NOT MEET THE SUITABILITY STANDARDS DESCRIBED HEREIN. REPRODUCTION OF THIS
OFFERING MEMORANDUM IS STRICTLY PROHIBITED.
6
<PAGE>
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED IN THIS OFFERING MEMORANDUM EXCEPT AS NOTED ABOVE
WITH REGARD TO QUESTIONS ASKED OF THE COMPANY AND OF THOSE AUTHORIZED TO ACT ON
ITS BEHALF. NO OFFERING LITERATURE OR ADVERTISING HAS BEEN AUTHORIZED BY THE
COMPANY EXCEPT THE INFORMATION CONTAINED HEREIN. ANY INFORMATION OR
REPRESENTATION NOT CONTAINED HEREIN MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ITS OFFICERS AND DIRECTORS. EXCEPT AS OTHERWISE
INDICATED, THIS OFFERING MEMORANDUM SPEAKS AS OF THE DATE ON THE COVER PAGE
NEITHER THE DELIVERY OF THIS OFFERING MEMORANDUM NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE RESPECTIVE DATES AT WHICH THE
INFORMATION IS GIVEN HEREIN OR THE DATE HEREOF.
ANY UNSOLD SHARES MAY BE PURCHASED BY THE COMPANY OR ITS AFFILIATES ON THE
SAME TERMS AS SHARES PURCHASED BY OTHER INVESTORS.
NOTICES TO RESIDENTS OF CERTAIN STATES
NOTICE TO ALABAMA RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
ALABAMA SECURITIES ACT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES
HAS NOT BEEN FILED WITH THE ALABAMA SECURITIES COMMISSION. THE COMMISSION DOES
NOT RECOMMEND OR ENDORSE THE PURCHASE OF ANY SECURITIES, NOR DOES IT PASS UPON
THE ACCURACY OR COMPLETENESS OF THIS OFFERING MEMORANDUM. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
ANYTHING TO THE CONTRARY HEREIN NOTWITHSTANDING, THE INVESTMENT OF AN
ALABAMA PURCHASER WHO IS NOT AN ACCREDIT INVESTOR MAY NOT EXCEED TWENTY (20%)
PER CENT OF SUCH PURCHASER'S NET WORTH, EXCLUSIVE OF PRINCIPAL RESIDENCE,
FURNISHINGS AND AUTOMOBILES.
NOTICE TO ALASKA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE ALASKA SECURITIES ACT
AND MAY NOT BE SOLD WITHOUT REGISTRATION UNDER THAT ACT OR EXEMPTION THEREFROM.
NOTICE TO ARIZONA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE ARIZONA SECURITIES ACT
AND ARE BEING SOLD IN RELIANCE UPON THE EXEMPTION CONTAINED IN SECTION 44-184(1)
OF SUCH ACT. THESE SECURITIES MAY NOT BE SOLD WITHOUT REGISTRATION UNDER SUCH
ACT OR EXEMPTION THEREFROM.
7
<PAGE>
ARIZONA RESIDENTS MUST HAVE EITHER (i) A MINIMUM NET WORTH OF AT LEAST
SEVENTY FIVE THOUSAND ($75,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND A MINIMUM ANNUAL GROSS INCOME OF SEVENTY FIVE THOUSAND
(475,000) DOLLARS; OR (iii) A NET WORTH OF AT LEAST TWO HUNDRED TWENTY FIVE
THOUSAND ($225,000) DOLLARS (AS COMPUTED ABOVE).
NOTICE TO ARKANSAS RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER SECTION
14(b)(14) OF THE ARKANSAS SECURITIES ACT AND SECTION 4(2) OF THE SECURITIES ACT
OF 1933. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS NOT BEEN
FILED WITH THE ARKANSAS SECURITIES DEPARTMENT OR WITH THE SECURITIES AND
EXCHANGE COMMISSION. NEITHER THE DEPARTMENT NOR THE COMMISSION HAS PASSED UPON
THE VALUE OF THESE SECURITIES, MADE ANY RECOMMENDATIONS AS TO THEIR PURCHASE,
APPROVED OR DISAPPROVED THE OFFERING, OR PASSED UPON THE ADEQUACY OR ACCURACY OF
THIS OFFERING MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, AN INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TWENTY (20%) PER CENT OF THE INVESTOR'S
NET WORTH AT THE TIME OF PURCHASE, ALONE OR JOINTLY WITH SPOUSE.
NOTICE TO CALIFORNIA RESIDENTS
IF THE COMPANY ELECTS TO SELL SHARES IN THE STATE OF CALIFORNIA, IT IS
UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THE SHARES, OR OTHER INTEREST
THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR WITHOUT THE PRIOR WRITTEN
CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA, EXCEPT
AS PERMITTED IN THE COMMISSIONER'S RULES.
NOTICE TO CONNECTICUT RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE CONNECTICUT SECURITIES
ACT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION OR EXEMPTION
THEREFROM.
NOTICE TO DELAWARE RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE DELAWARE SECURITIES ACT
AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION OR EXEMPTION THEREFROM.
8
<PAGE>
NOTICE TO FLORIDA RESIDENTS
THE SHARES REFERRED TO HEREIN WILL BE SOLD TO, AND ACQUIRED BY, THE HOLDER
IN A TRANSACTION EXEMPT UNDER SECTION 517.061 OF THE FLORIDA SECURITIES ACT. THE
SHARES HAVE NOT BEEN REGISTERED UNDER SAID ACT IN THE STATE OF FLORIDA. IN
ADDITION, ALL FLORIDA RESIDENTS SHALL HAVE THE PRIVILEGE OF VOIDING THE PURCHASE
WITHIN THREE (3) DAYS AFTER THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH
PURCHASER TO THE ISSUER, AN AGENT OF THE ISSUER, OR AN ESCROW AGENT OR WITHIN
THREE (3) DAYS AFTER THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH
PURCHASER, WHICHEVER OCCURS LATER.
NOTICE TO GEORGIA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE GEORGIA SECURITIES ACT
OF 1973, AS AMENDED. IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION SET FORTH
IN SECTION 9(M) OF SUCH ACT AND THE SECURITIES CANNOT BE SOLD OR TRANSFERRED
EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER SUCH ACT OR PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT OR IN A TRANSACTION WHICH IS
OTHERWISE IN COMPLIANCE WITH SAID ACT.
NOTICE TO IDAHO RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE CONNECTICUT SECURITIES
ACT AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION OR EXEMPTION
THEREFROM.
ANYTHING TOT HE CONTRARY NOTWITHSTANDING, THE INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET
WORTH.
NOTICE TO INDIANA RESIDENTS
EACH INVESTOR PURCHASING SHARES MUST WARRANT THAT HE HAS EITHER (i) A NET
WORTH (EXCLUSIVE OF HOME, HOME FURNISHING AND AUTOMOBILES) EQUAL TO AT LEAST
THREE (3) TIMES THE AMOUNT OF HIS INVESTMENT BUT IN N O EVENT LESS THAN SEVENTY
FIVE THOUSAND (475,000) DOLLARS OR (ii) A NET WORTH (EXCLUSIVE OF HOME, HOME
FURNISHING AND AUTOMOBILES OF TOW (2) TIMES HIS INVESTMENT BUT IN NOT EVENT LESS
THAN THIRTY THOUSAND ($30,000) DOLLARS AND A GROSS INCOME OF THIRTY THOUSAND
($30,000) DOLLARS.
NOTICE TO IOWA RESIDENTS
IOWA RESIDENTS MUST HAVE EITHER (i) A NET WORTH OF AT LEAST FORTH THOUSAND
($40,000) DOLLARS (EXCLUSIVE OF HOME, HOME FURNISHINGS AND AUTOMOBILES) AND A
MINIMUM ANNUAL GROSS INCOME OF FORTH THOUSAND($40,000) DOLLARS, OR (ii) A NET
WORTH OF AT LEAST ONE HUNDRED TWENTY FIVE THOUSAND ($125,000) DOLLARS AS
COMPUTED ABOVE.
9
<PAGE>
NOTICE TO KANSAS RESIDENTS
AN INVESTMENT BY A NON-ACCREDITED INVESTOR SHALL NOT EXCEED TWENTY (20%)
PER CENT OF THE INVESTOR'S NET WORTH; EXCLUDING PRINCIPAL RESIDENCE, FURNISHINGS
THEREIN AND PERSONAL AUTOMOBILES.
NOTICE TO KENTUCKY RESIDENTS
THESE SECURITIES REPRESENTED BY THIS CERTIFICATE (OR OTHER DOCUMENT) HAVE
BEEN ISSUED PURSUANT TO A CLAIM OF EXEMPTION FROM THE REGISTRATION OR
QUALIFICATION PROVISIONS OF FEDERAL AND STATE SECURITIES LAWS AND MAY NOT BE
SOLD OR TRANSFERRED WITHOUT COMPLIANCE WITH THE REGISTRATION OR QUALIFICATION
PROVISIONS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS OR APPLICABLE
EXEMPTIONS THEREIN.
ANYTHING TO THE CONTRARY HEREIN NOTWITHSTANDING, THE INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TEN (10%) OF THE INVESTOR'S NET WORTH.
NOTICE TO MAINE RESIDENTS
THESE SECURITIES ARE BEING SOLD PURSUANT TO AN EXEMPTION FROM REGISTRATION
WITH THE BANK SUPERINTENDENT OF THE STATE OF MAINE UNDER SECTION 1052(2)(R) OF
TITLE 32 OF THE MAINE REVISED STATUES. THESE SECURITIES MAY BE DEEMED RESTRICTED
SECURITIES AND AS SUCH THE HOLDER MAY NOT BE ABLE TO RESELL THE SECURITIES
UNLESS PURSUANT TO REGISTRATION UNDER STATE OR FEDERAL SECURITIES LAWS OR UNLESS
AN EXEMPTION UNDER SUCH LAWS EXISTS.
NOTICE TO MARYLAND RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE MARYLAND SECURITIES ACT
IN RELIANCE UPON THE EXEMPTION FROM REGISTRATION SET FORTH IN SECTION 11-602(9)
OF SUCH ACT. UNLESS THESE SECURITIES ARE REGISTERED, THEY MAY NOT BE REOFFERED
FOR SALE OR RESOLD IN THE STATE OF MARYLAND, EXCEPT AS A SECURITY, OR IN A
TRANSACTION EXEMPT UNDER SUCH ACT.
NOTICE TO MASSACHUSETTS RESIDENTS
MASSACHUSETTS RESIDENTS MUST HAVE HAD EITHER (i) A MINIMUM NET WORTH OF AT
LEAST FIFTY THOUSAND ($50,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND HAD DURING THE LAST YEAR, OR IT IS ESTIMATED THAT THE
SUBSCRIBER WILL HAVE DURING THE CURRENT TAKE YEAR, TAXABLE INCOME OF FIFTY
THOUSAND ($50,000) DOLLARS, OR (ii) A NET WORTH OF AT LEAST ONE HUNDRED FIFTY
THOUSAND ($150,000) DOLLARS (AS COMPUTED ABOVE).
10
<PAGE>
NOTICE TO MICHIGAN RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE MICHIGAN SECURITIES ACT
AND MAY NOT BE SOLD OR TRANSFERRED WITHOUT REGISTRATION UNDER THAT ACT OR
EXEMPTION THEREFROM.
THE COMPANY SHALL PROVIDE ALL MICHIGAN INVESTORS WITH A DETAILED WRITTEN
STATEMENT OF THE APPLICATION OF THE PROCEEDS OF THE OFFERING WITHIN SIX (6)
MONTHS AFTER COMMENCEMENT OF THE OFFERING OR UPON COMPLETION, WHICHEVER OCCURS
FIRST, AND WITH ANNUAL CURRENT BALANCE SHEETS AND INCOME STATEMENT THEREAFTER.
NOTICE TO MINNESOTA RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER CHAPTER 80 OF THE MINNESOTA
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF FOR
VALUE EXCEPT PURSUANT TO REGISTRATION OR OPERATION OF LAW.
NOTICE TO MISSISSIPPI RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
MISSISSIPPI SECURITIES ACT. A REGISTRATION STATEMENT RELATING TO THESE
SECURITIES HAS NOT BEEN FILED WITH THE MISSISSIPPI SECRETARY OF STATE OR WITH
THE SECURITIES AND EXCHANGE COMMISSION. NEITHER THE SECRETARY OF STATE NOR THE
COMMISSION HAS PASSED UPON THE VALUE OF THESE SECURITIES, NO HAS APPROVED OR
DISAPPROVED THE OFFERING. THE SECRETARY OF STATE DOES NOT RECOMMEND THE PURCHASE
OF THESE OR ANY OTHER SECURITIES.
THERE IS NOT ESTABLISHED MARKET FOR THESE SECURITIES AND THERE MAY NOT BE
ANY MARKET FOR THESE SECURITIES IN THE FUTURE. THE SUBSCRIPTION PRICE OF THESE
SECURITIES HAS BEEN ARBITRARILY DETERMINED BY THE ISSUER AND IS NOT AN
INDICATION OF THE ACTUAL VALUE OF THESE SECURITIES.
THE PURCHASER OF THESE SECURITIES MUST MEET CERTAIN SUITABILITY STANDARDS
AND MUST BE ABLE TO BEAR THE ENTIRE LOSS OF HIS INVESTMENT. ADDITIONALLY, ALL
PURCHASERS WHO ARE NOT ACCREDITED INVESTORS MUST HAVE A NET WORTH OF AT LEAST
THIRTY THOUSAND ($30,000) DOLLARS AND INCOME OF THIRTY THOUSAND ($30,000)
DOLLARS OR A NET WORTH OF SEVENTY FIVE THOUSAND ($75,000) DOLLARS. THESE
SECURITIES MAY NOT BE TRANSFERRED FOR A PERIOD OF ONE (1) YEAR EXCEPT IN A
TRANSACTION WHICH IS EXEMPT UNDER THE MISSISSIPPI SECURITIES ACT OR IN A
TRANSACTION IN COMPLIANCE WITH THE MISSISSIPPI SECURITIES ACT.
11
<PAGE>
NOTICE TO MISSOURI RESIDENTS
THESE SECURITIES ARE SOLD TO, AND BEING ACQUIRED BY, THE HOLDER IN A
TRANSACTION EXEMPTED UNDER SECTION 10, SUBSECTION 409.402(b), MISSOURI UNIFORM
SECURITIES ACT (RMSO 1969).
THE SHARES HAVE TO BEEN REGISTERED UNDER SAID ACT IN THE STATE OF MISSOURI,
UNLESS THE SHARES ARE REGISTERED, THEY MAY NOT BE REOFFERED OR RESOLD IN THE
STATE OF MISSOURI, EXCEPT AS A SECURITY, OR IN A TRANSACTION EXEMPT UNDER SAID
ACT.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTOR MUST HAVE A MINIMUM
ANNUAL INCOME OF THIRTY THOUSAND ($330,000) DOLLARS AND A NET WORTH OF AT LEAST
THIRTY THOUSAND ($30,000)(DOLLARS, EXCLUSIVE OF HOME, FURNISHINGS AND
AUTOMOBILES OR A NET WORTH OF SEVENTY FIVE THOUSAND ($75,000) DOLLARS EXCLUSIVE
OF HOME, FURNISHINGS AND AUTOMOBILES.
AN INVESTMENT BY A NON-ACCREDITED INVESTOR SHALL NOT EXCEED TWENTY (20%)
PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE TO MONTANA RESIDENTS
EACH MONTANA RESIDENT WHO SUBSCRIBES FOR THE SECURITIES BEING OFFERED
HEREBY AGREES NOT TO SELL THESE SECURITIES FOR A PERIOD OF TWELVE (12) MONTHS
AFTER DATE OF PURCHASE.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, THE INVESTMENT BY A
NON-ACCREDITED INVESTOR MAY NOT EXCEED TWENTY (20%) PER CENT OF THE INVESTOR'S
NET WORTH.
NOTICE TO NEBRASKA RESIDENTS
THESE SHARES HAVE NOT BEEN REGISTERED UNDER THE NEBRASKA SECURITIES ACT AND
MAY NOT BE SOLD WITHOUT REGISTRATION UNDER THE ACT OR EXEMPTION THEREFROM.
NOTICE TO NEW HAMPSHIRE RESIDENTS
EACH NEW HAMPSHIRE INVESTOR PURCHASING SHARES MUST WARRANT THAT HE HAS
EITHER (i) A NET WORTH (EXCLUSIVE OF HOME, HOME FURNISHING AND AUTOMOBILES) OF
TWO HUNDRED FIFTY THOUSAND ($250,000) DOLLARS OR (iii) A NET WORTH (EXCLUSIVE OF
HOME, HOME FURNISHINGS AND AUTOMOBILES OF ONE HUNDRED TWENTY FIVE THOUSAND
($125,000) DOLLARS AND FIFTY THOUSAND ($50,000 DOLLARS ANNUAL INCOME.
12
<PAGE>
NOTICE TO NEW JERSEY RESIDENTS
THE ATTORNEY GENERAL OF THE STATE HAS NOT PASSED ON OR ENDORSED THE MERITS
OF THIS OFFERING. THE FILING OF THE WITHIN OFFERING DOES TO CONSTITUTE APPROVAL
OF THE ISSUE OR THE SALE THEREOF BY THE BUREAU OF SECURITIES OR THE DEPARTMENT
OF LAW AND PUBLIC SAFETY OF THE STATE OF NEW JERSEY. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
NOTICE TO NORTH DAKOTA RESIDENTS
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
COMMISSION OF THE STATE OF NORTH DAKOTA NOR HAS THE COMMISSIONER PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
CRIMINAL OFFENCE.
NOTICE TO NEW YORK RESIDENTS
THIS OFFERING MEMORANDUM HAS NOT BEEN REVIEWED BY THE ATTORNEY GENERAL
PRIOR TO ITS ISSUANCE AND USE. THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS
NOT PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
THIS OFFERING MEMORANDUM DOES NOT CONTAIN AN UNTRUE STATEMENT OF A MATERIAL
FACT OR OMIT TO STATE A MATERIAL FACT NECESSARY TO MAKE THE STATEMENTS MADE IN
LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING. IT
CONTAINS A FAIR SUMMARY OF THE MATERIAL TERMS AND DOCUMENTS PURPORTED TO BE
SUMMARIZED HEREIN.
NOTICE TO NORTH CAROLINA RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
NORTH CAROLINA SECURITIES ACT. THE NORTH CAROLINA SECURITIES ADMINISTRATOR
NEITHER RECOMMENDS NOR ENDORSES THE PURCHASE OF ANY SECURITY, NOR HAS THE
ADMINISTRATOR PASSED ON THE ACCURACY OR ADEQUACY OF THE INFORMATION PROVIDED
HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NOTICE TO OKLAHOMA RESIDENTS
THESE SECURITIES RENDERED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE OKLAHOMA SECURITIES ACT. THE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR TRANSFERRED FOR VALUE
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION OF THEM UNDER THE SECURITIES ACT OF
1933 AND/OR THE OKLAHOMA SECURITIES ACT OF AN OPINION OF COUNSEL TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR ACTS.
13
<PAGE>
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY A NON-ACCREDITS
INVESTOR SHALL NOT EXCEED THEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE TO OREGON RESIDENTS
THE SECURITIES OFFERED HAVE BEEN REGISTERED WITH THE DIRECTOR OF THE STATE
OF OREGON UNDER THE PROVISIONS OF OAR 441-65-240. THE INVESTOR IS ADVISED THAT
THE DIRECTOR HAS MADE ONLY A CURSORY REVIEW OF THE REGISTRATION STATEMENT AND
HAS NOT REVIEWED THIS DOCUMENTS SINCE THIS DOCUMENT IS NOT REQUIRED TO BE FILED
WITH THE DIRECTOR.
THE INVESTOR MUST RELY ON THE INVESTOR'S OWN EXAMINATION OF THE COMPANY
CREATING THE SECURITIES, AND THE TERMS OF THE OFFERING INCLUDING THE MERITS AND
RISKS INVOLVED IN MAKING AN INVESTMENT DECISION ON THESE SECURITIES.
NOTICE TO PENNSYLVANIA RESIDENTS
ANY PERSON WHO ACCEPTS AN OFFER TO PURCHASE THE SECURITIES IN THE
COMMONWEALTH OF PENNSYLVANIA IS ADVISED, THAT PURSUANT TO SECTION 207(m) OF THE
PENNSYLVANIA SECURITIES ACT, HE SHALL HAVE THE RIGHT TO WITHDRAW HIS ACCEPTANCE,
AND RECEIVE A FULL REFUND OF ANY CONSIDERATION PAID, WITHOUT INCURRING ANY
LIABILITY, WITHIN TWO (20) BUSINESS DAYS FROM THE TIME THAT HE RECEIVES NOTICE
OF THIS WITHDRAWAL RIGHT AND RECEIVES THE PLACEMENT OFFERING MEMORANDUM. ANY
PERSON WHO WISHES TO EXERCISE SUCH RIGHT OF WITHDRAWAL IS ADVISED TO GIVEN
NOTICE BY LETTER OR TELEGRAM SENT TO POSTMARKED BEFORE THE END OF THE SECOND
BUSINESS DAY AFTER EXECUTION. IF THE REQUEST FOR WITHDRAWAL IS TRANSMITTED
ORALLY, WRITTEN CONFIRMATION MUST BE GIVEN. ANY PERSON WHO PURCHASES INTERESTS
WHO IS A PENNSYLVANIA RESIDENT WILL NOT SELL SUCH INTERESTS FOR A PERIOD OF
TWELVE (12) MONTHS BEGINNING WITH THE CLOSING DATE. PENNSYLVANIA RESIDENTS MUST
HAVE EITHER (i) A MINIMUM NET WORTH OF THIRTY THOUSAND ($30,000) DOLLARS
(EXCLUDING HOME, HOME FURNISHING AND AUTOMOBILES) AND A MINIMUM ANNUAL GROSS
INCOME OF THIRTY THOUSAND ($30,000) DOLLARS, OR (ii) A NET WORTH OF AT LEAST
SEVENTY FIVE THOUSAND ($75,000) DOLLARS (AS COMPUTED ABOVE0, AND MAY NOT INVEST
MORE THAN TEN (10%) PER CENT OF THEIR NET WORTH (EXCLUSIVE OF THE SUBSCRIBER'S
HOME, HOME FURNISHINGS AND AUTOMOBILES).
NOTICE TO SOUTH CAROLINA RESIDENTS
THESE SECURITIES ARE OFFERED PURSUANT TO A CLAIM OF EXEMPTION UNDER THE
SOUTH CAROLINA UNIFORM SECURITIES ACT. A REGISTRATION STATEMENT RELATING TO
THESE SECURITIES HAS NOT BEEN FILED WITH THE SOUTH CAROLINA SECURITIES
COMMISSIONER. THE COMMISSIONER DOES NOT RECOMMEND OR ENDORSE THE PURCHASE OF ANY
SECURITIES, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF THIS OFFERING
MEMORANDUM. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
14
<PAGE>
NOTICE TO SOUTH DAKOTA RESIDENTS
THE SHARES HAVE NOT BEEN REGISTERED UNDER CHAPTER 47.31 OF THE SOUTH DAKOTA
SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF FOR
VALUE EXCEPT PURSUANT TO REGISTRATION, EXEMPTION THEREFROM OR OPERATION OF LAW.
SOUTH DAKOTA RESIDENTS MUST HAVE EITHER (i) A MINIMUM NET WORTH OF AT LEAST
SIXTY THOUSAND ($60,000) DOLLARS (EXCLUDING HOME, HOME FURNISHINGS AND
AUTOMOBILES) AND A MINIMUM GROSS INCOME OF SIXTY THOUSAND ($60,000) DOLLARS, OR
(ii) A NET WORTH OF AT LEAST TWO HUNDRED TWENTY FIVE THOUSAND ($225,000) DOLLARS
(AS COMPUTED ABOVE).
NOTICE OF TENNESSEE RESIDENTS
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY ANY INVESTOR
SHALL NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE OF TEXAS RESIDENTS
THIS OFFERING MEMORANDUM IS FOR THE INVESTOR'S CONFIDENTIAL USE AND MAY NOT
BE REPRODUCED. ANY ACTION CONTRARY TO THESE RESTRICTIONS MAY PLACE SUCH INVESTOR
AND THE ISSUER IN VIOLATION OF THE TEXAS SECURITIES ACT.
ANYTHING TO THE CONTRARY NOTWITHSTANDING, AN INVESTMENT BY ANY INVESTOR
SHALL NOT EXCEED TEN (10%) PER CENT OF THE INVESTOR'S NET WORTH.
NOTICE TO UTAH RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UTAH SECURITIES ACT AND
MAY NOT NE SOLD WITHOUT REGISTRATION UNDER THAT ACT OR EXEMPTION THEREFROM.
NOTICE TO WASHINGTON RESIDENTS
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE WASHINGTON SECURITIES
ACT AND THE ADMINISTRATOR OF SECURITIES OF THE STATE OF WASHINGTON HAS NOT
REVIEWED THE OFFERING OR OFFERING MEMORANDUM. THESE SECURITIES MAY NOT BE SOLD
WITHOUT REGISTRATION UNDER THE ACT OR EXEMPTION THEREFROM.
15
<PAGE>
IT IS THE RESPONSIBILITY OF ANY INVESTOR PURCHASING SHARES TO SATISFY
ITSELF AS TO FULL OBSERVANCE OF THE LAWS OF ANY RELEVANT TERRITORY OUTSIDE THE
UNITED STATES IN CONNECTION WITH ANY SUCH PURCHASE, INCLUDING OBTAINING ANY
REQUIRED GOVERNMENTAL OR OTHER CONSENTS OR OBSERVING ANY OTHER APPLICABLE
REQUIREMENTS.
16
<PAGE>
--------------------------------------------------------------------------------
OFFERING MEMORANDUM
--------------------------------------------------------------------------------
L W Global (U.S.A.), Inc.
(A Delaware Corporation)
Offering Memorandum Dated September 10, 1996
1,200,000 Shares
L W Global (U.S.A.), Inc., (the "Company"), a Delaware corporation, is
offering on a "best efforts, no minimum basis" up to a maximum of 1,200,000
shares of common stock ("Common Stock"), $.001 par value, at $0.01 per Share.
Since there is no minimum, no proceeds will be held in escrow account and all
funds will be immediately available to the Company.
The Company intends to apply for inclusion of the Common Stock on the Over
the Counter Electronic Bulletin Board. There can be no assurances that an active
trading market will develop, even if the securities are accepted for quotation.
Additionally, even if the Company's securities are accepted for quotation and
active trading develops, the Company is still required to maintain certain
minimum criteria established by NASDAQ, of which there can be no assurance that
the Company will be able to continue to fulfill such criteria.
Prior to this offering, there has been no public market for the common
stock of the Company. The price of the Shares offered hereby was arbitrarily
determined by the Company and does not bear any relationship to the Company's
assets, book value, net worth, results of operations or any other recognized
criteria of value. For additional information regarding the factors considered
in determining the offering price of the Shares, see "Risk Factors - Arbitrary
Offering Price," "Description of Securities".
The Company does not presently file reports or other information with the
Securities and Exchange Commission ("Commission"). However, following completion
of this offering, the Company intends to furnish its security holders with
annual reports containing audited financial statements and such interim reports,
in each case as it may determine to furnish or as may be required by law.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OF ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE SECURITIES ARE OFFERED BY THE COMPANY SUBJECT TO PRIOR SALE, ACCEPTANCE
OR AN OFFER TO PURCHASE, WITHDRAWAL, CANCELLATION OR MODIFICATION OF THE OFFER,
WITHOUT NOTICE. THE COMPANY RESERVES THE RIGHT TO REJECT ANY ORDER, IN WHOLE OR
IN PART, FOR THE PURCHASE OF ANY OF THE SECURITIES OFFERED HEREBY.
1
<PAGE>
This offering involves special risks concerning the Company (see "Risk
Factors"). Investors should carefully review the entire Memorandum and should
not invest any funds in this Offering unless they can afford to lose their
entire investment. In making an investment decision, investors must rely on
their own examination of the issuer and the terms of the Offering, including the
merit and risks involved.
OFFERING SUMMARY
The following summary information is qualified in its entirety by the
detailed information and financial statements and notes thereto appearing
elsewhere in this Memorandum.
The Company is in the business of providing equipment, supplies and other
products and maintenance to the financial and business community. The Company
was incorporated in the State of Delaware and its principal executive office is
located at 222 Lakeview Avenue, Suite 160--124, West Palm Beach, FL 33401 and
its telephone number is (407) 833-5092
RISK FACTORS
THE SECURITIES OFFERED HEREBY ARE SPECULATIVE AND INVOLVE A HIGH DEGREE OF
RISK. ONLY THOSE PERSONS ABLE TO LOSE THEIR ENTIRE INVESTMENT SHOULD PURCHASE
THESE SECURITIES. PROSPECTIVE INVESTORS, PRIOR TO MAKING AN INVESTMENT DECISION,
SHOULD CAREFULLY READ THIS PROSPECTUS AND CONSIDER, ALONG WITH OTHER MATTERS
REFERRED TO HEREIN, THE FOLLOWING RISK FACTORS:
Risk Factors Relating to the Business of the Company
Start-up or Development Stage Company. The Company did not have any
operations before its organization and is a "start-up" or "development stage"
company. No assurances can be given that the Company will be able to compete
with other companies in its industry. The purchase of the securities offered
hereby must be regarded as the placing of funds at a high risk in a new or
"start-up" venture with all the unforeseen costs, expenses, problems, and
difficulties to which such ventures are subject. See "Use of Proceeds to Issuer"
and "Description of Business."
No Assurance of Profitability. To date, the Company has not generated any
revenues from operations. The Company does not anticipate any significant
revenues in the near future. The 0Company's ability to successfully implement
its business plan is dependent on the completion of this Offering. There can be
no assurance that the Company will be able to develop into a successful or
profitable business.
2
<PAGE>
No Assurance of Payment of Dividends. No assurances can be made that the
future operations of the Company will result in additional revenues or will be
profitable. Should the operations of the Company become profitable, it is likely
that the Company would retain much or all of its earnings in order to finance
future growth and expansion. Therefore, the Company does not presently intend to
pay dividends, and it is not likely that any dividends will be paid in the
foreseeable future. See "Dividend Policy."
Possible Need for Additional Financing . The Company intends to fund its
operations and other capital needs for the next 12 months substantially from the
operations and proceeds of this Offering, but there can be no assurance that
such funds will be sufficient for these purposes. The Company may require
additional amounts of capital for its future expansion, operating costs and
working capital. The Company has made no arrangements to obtain future
additional financing, and if required, there can be no assurance that such
financing will be available, or that such financing will be available on
acceptable terms. See "Use of Proceeds."
Dependence on Management. The Company's success is principally dependent on
its current management personnel for the operation of its business.
Broad Discretion in Application of Proceeds . The management of the Company
has broad discretion to adjust the application and allocation of the net
proceeds of this offering, in order to address changed circumstances and
opportunities. As a result of the foregoing, the success of the Company will be
substantially dependent upon the discretion and judgment of the management of
the Company with respect to the application and allocation of the net proceeds
hereof. Pending use of such proceeds, the net proceeds of this offering will be
invested by the Company in temporary, short-term interest-bearing obligations.
See "Use of Proceeds."
Arbitrary Offering Price. There has been no prior public market for the
Company's securities. The price to the public of the Shares offered hereby has
been arbitrarily determined by the Company and bears no relationship to the
Company's earnings, book value or any other recognized criteria of value.
Immediate and Substantial Dilution. An investor in this offering will
experience immediate and substantial dilution.
Lack of Prior Market for Securities of the Company. No prior market has
existed for the securities being offered hereby and no assurance can be given
that a market will develop subsequent to this offering.
No Escrow of Investors' Funds. This offering is being made on a "best
efforts, no minimum basis" As such, all the funds from this Offering will be
immediately available to the Company.
USE OF PROCEEDS
The Company will receive the proceeds from the Offering for working
capital.
3
<PAGE>
DIVIDEND POLICY
Holders of the Company's Common Stock are entitled to dividends when, as
and if declared by the Board of Directors out of funds legally available
therefor. The Company does not anticipate the declaration or payment of any
dividends in the foreseeable future. The Company intends to retain earnings, if
any, to finance the development and expansion of its business. Future dividend
policy will be subject to the discretion of the Board of Directors and will be
contingent upon future earnings, if any, the Company's financial condition,
capital requirements, general business conditions and other factors. Therefore,
there can be no assurance that any dividends of any kind will ever be paid.
THE COMPANY
The Company is in the business of providing equipment, supplies and other
products and maintenance to offices, businesses and financial institutions. In
addition, the company is negotiating with other companies in the office supply
field with the intent of acquiring all of the shares or assets of one or more of
these companies. However, if the company is unable to complete the
acquisition/acquisitions it will continue to operate its existing business and
expand its activities through internal growth.
Management
Dale B. Finfrock, Jr. , is the Company's sole Director, and its President
and Secretary.
EXECUTIVE COMPENSATION
Since the Company was recently incorporated, it has no historical
information with respect to executive compensation. At the conclusion of the
Offering, the Company does not intend to compensate its officers for services to
the Company from the proceeds of this Offering and will only do so when and if
the Company generates profits.
Compensation of Directors
Directors are not paid fees for their services nor reimbursed for expenses
of attending board meetings.
DESCRIPTION OF SECURITIES
Shares
The Company is offering hereby a "best efforts, no minimum basis" up to
1,200,000 shares of Common Stock at $.01 per Share.
Common Stock
The authorized capital stock of the Company consists of 20,000,000 shares
of Common Stock, $.001 par value. Holders of the Common Stock do not have
preemptive rights to purchase additional shares of Common Stock or other
4
<PAGE>
subscription rights. The Common Stock carries no conversion rights and is not
subject to redemption or to any sinking fund provisions. All shares of Common
Stock are entitled to share equally in dividends from sources legally available
therefor when, as and if declared by the Board of Directors and, upon
liquidation or dissolution of the Company, whether voluntary or involuntary, to
share equally in the assets of the Company available for distribution to
stockholders. All outstanding shares of Common Stock are validly authorized and
issued, fully paid and nonassessable, and all shares to be sold and issued as
contemplated hereby, will be validly authorized and issued, fully paid and
nonassessable. The Board of Directors is authorized to issue additional shares
of Common Stock, not to exceed the amount authorized by the Company's
Certificate of Incorporation, on such terms and conditions and for such
consideration as the Board may deem appropriate without further stockholder
action. The above description concerning the Common Stock of the Company does
not purport to be complete. Reference is made to the Company's Certificate of
Incorporation and Bylaws which are available for inspection upon proper notice
at the Company's offices, as well as to the applicable statutes of the State of
Florida for a more complete description concerning the rights and liabilities of
stockholders.
Prior to this offering, there has been no market for the Common Stock of
the Company, and no predictions can be made of the effect, if any, that market
sales of shares or the availability of shares for sale will have on the market
price prevailing from time to time. Nevertheless, sales of significant amounts
of the Common Stock of the Company in the public market may adversely affect
prevailing market prices, and may impair the Company's ability to raise capital
at that time through the sale of its equity securities.
Each holder of Common Stock is entitled to one vote per share on all
matters on which such stockholders are entitled to vote. Since the shares of
Common Stock do not have cumulative voting rights, the holders of more than 50
percent of the shares voting for the election of directors can elect all the
directors if they choose to do so and, in such event, the holders of the
remaining shares will not be able to elect any person to the Board of Directors.
PLAN OF DISTRIBUTION
The Company has no underwriter for this Offering. The Offering is therefore
a self- underwriting. The Shares will be offered by the Company at the offering
price of $.01 per Share.
Price of the Offering.
There is no, and never has been, a market for the Shares, and there is no
guaranty that a market will ever develop for the Company's shares. Consequently,
the offering price has been determined by the Company. Among other factors
considered in such determination were estimates of business potential for the
Company, the Company's financial condition, an assessment of the Company's
management and the general condition of the securities market at the time of
this Offering. However, such price does not necessarily bear any relationship to
the assets, income or net worth of the Company.
The offering price should not be considered an indication of the actual
value of the Shares. Such price is subject to change as a result of market
conditions and other factors, and no assurance can be given that the Shares can
be resold at the Offering Price.
5
<PAGE>
There can be no assurance that an active trading market will develop upon
completion of this Offering, or if such market develops, that it will continue.
Consequently, purchasers of the Shares offered hereby may not find a ready
market for Shares.
ADDITIONAL INFORMATION
Each investor warrants and represents to the Company that, prior to making
an investment in the Company, that he has had the opportunity to inspect the
books and records of the Company and that he has had the opportunity to make
inquiries to the officers and directors of the Company and further that he has
been provided full access to such information.
INVESTOR SUITABILITY STANDARDS AND
INVESTMENT RESTRICTIONS
Suitability
Shares will be offered and sold pursuant an exemption under the Securities
Act, and exemptions under applicable state securities and Blue Sky laws. There
are different standards under these federal and state exemptions which must be
met by prospective investors in the Company.
The Company will sell Shares only to those Investors it reasonably believes
meet certain suitability requirements described below.
Each prospective Investor must complete a Confidential Purchaser
questionnaire and each Purchaser Representative, if any, must complete a
Purchaser Representative Questionnaire.
EACH INVESTOR MUST BE RESPONSIBLE FOR DETERMINING THAT IT IS PERMITTED TO
INVEST IN THE COMPANY, THAT ALL APPROPRIATE ACTIONS TO AUTHORIZE SUCH AN
INVESTMENT HAVE BEEN TAKEN, AND THAT ANY REQUIREMENTS THAT ITS INVESTMENTS BE
DIVERSIFIED OR SUFFICIENTLY LIQUID HAVE BEEN MET.
An investor will qualify as an accredited Investor if it falls within any
one of the following categories at the time of the sale of the Shares to that
Investor:
(1) A bank as defined in Section 3(a)(2) of the Securities Act, or a
savings and loan association or other institution as defined in Section
3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary
capacity; a broker or dealer registered pursuant to Section 15 of the Securities
Exchange Act of 1934; an insurance company as defined in Section 2(13) of the
Securities Act; an investment company registered under the Investment Company
Act of 1940 or a business development company as defined in Section 2(a)(48) of
that Act; a Small Business Investment Company licensed by the United States
Small Business Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; a plan established and maintained by a state, its
6
<PAGE>
political subdivisions, or any agency or instrumentality of a state or its
political subdivisions, for the benefit of its employees, if such plan has total
assets in excess of $5,000,000; an employee benefit plan within the meaning of
the Employee Retirement Income Security Act of 1974, if the investment decision
is made by a plan fiduciary, as defined in Section 3(21) of that Act, which is
either a bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets in excess
of $5,000,000, or, if a self-directed plan with the investment decisions made
solely by persons that are accredited investors;
(2) A private business development company as defined in Section 202(a)(22)
of the Investment Advisers Act of 1940;
(3) An organization described in Section 501(c)(3) of the Internal Revenue
Code with total assets in excess of $5,000,000;
(4) A director or executive officer of the Company.
(5) A natural person whose individual net worth, or joint net worth with
that person's spouse, at the time of such person's purchase of the Shares
exceeds $1,100,000;
(6) A natural person who had an individual income in excess of $200,000 in
each of the two most recent years or joint income with that person's spouse in
excess of $300,000 in each of those years and has a reasonable expectation of
reaching the same income level in the current year;
(7) A trust with total assets in excess of $5,000,000, not formed for the
specific purpose of acquiring the securities offered, whose purchase is directed
by a sophisticated person as describe in Rule 506(b)(2)(ii) of Regulation D; and
(8) An entity in which all of the equity owners are accredited investors
(as defined above).
As used in this Memorandum, the term "net worth" means the excess of total
assets over total liabilities. In computing net worth for the purpose of (5)
above, the principal residence of the investor must be valued at cost, including
cost of improvements, or at recently appraised value by an institutional lender
making a secured loan, net of encumbrances. In determining income an investor
should add to the investor's adjusted gross income any amounts attributable to
tax exempt income received, losses claimed as a limited partner in any limited
partnership, deductions claimed for depletion, contributions to an IRA or KEOGH
retirement plan, alimony payments, and any amount by which income form long-term
capital gains has been reduced in arriving at adjusted gross income.
In order to meet the conditions for exemption from the registration
requirements under the securities laws of certain jurisdictions, investors who
are residents of such jurisdiction may be required to meet additional
suitability requirements.
An Investor that does not qualify as an accredited Investor is a
nonaccredited Investor and may acquire Shares only if:
7
<PAGE>
(1) The Investor is knowledgeable and experienced with respect to
investments in limited partnerships either alone or with its Purchaser
Representative, if any; and
(2) The Investor has been provided access to all relevant documents it
desires or needs; and
(3) The Investor is aware of its limited ability to sell and/or transfer
its Shares in the Company; and
(4) The Investor can bear the economic risk (including loss of the entire
investment) without impairing its ability to provide for its financial needs and
contingencies in the same manner as it was prior to making such investment.
THE COMPANY RESERVES THE RIGHT IN ITS ABSOLUTE DISCRETION TO DETERMINE IF A
POTENTIAL INVESTOR MEETS OR FAILS TO MEET THE SUITABILITY STANDARDS SET FORTH IN
THIS SECTION.
Additional Suitability Requirements for Benefit Plan Investors
In addition to the foregoing suitability standards generally applicable to
all Investors, the Employee Retirement Income Security Act of 1934, as amended
("ERISA"), and the regulations promulgated thereunder by the Department of Labor
impose certain additional suitability standards for Investors that are qualified
pension, profit-sharing or stock bonus plans ("Benefit Plan Investor"). In
considering the purchase of Shares, a fiduciary with respect to a prospective
Benefit Plan Investor must consider whether an investment in the Shares will
satisfy the prudence requirement of Section 404(a)(1)(B) of ERISA, since there
is not expected to be any market created in which to sell or otherwise dispose
of the Shares. In addition, the fiduciary must consider whether the investment
in Shares will satisfy the diversification requirement of Section 404(a)(1)(C)
of ERISA.
Restrictions on Transfer or Resale of Shares
The Availability of Federal and state exemptions and the legality of the
offers and sales of the Shares are conditioned upon, among other things, the
fact that the purchase of Shares by all Investors are for investment purposes
only and not with a view to resale or distribution. Accordingly, each
prospective Investor will be required to represent in the Subscription Agreement
that it is purchasing the Shares for its own account and for the purpose of
investment only, not with a view to, or in accordance with, the distribution of
sale of the Shares and that it will not sell, pledge, assign or transfer or
offer to sell, pledge, assign or transfer any of its Shares without an effective
registration statement under the Securities Act, or an exemption there from and
an opinion of counsel acceptable to the Company that registration under the
Securities Act is not required and that the transaction complies with all other
applicable Federal and state securities or Blue Sky laws.
8
