GROWTH NET INC, SB-2, 2000-08-14

GROWTH NET INC
SB-2, 2000-08-14

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As filed with the Securities and Exchange Commission on , 2000

Registration No.

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

----------------

FORM SB-2

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

----------------

GROWTH NET, INC.

(Name of Small Business Issuer in Its Charter)

---------------- ------------------- ----------------------

Nevada 541990 22-3664233

(State or other (Primary Standard (I.R.S. Employer
jurisdiction of Industrial Identification Number)
incorporation or Classification Code
organization) Number)

----------------
900 W. 190th Street, Suite 4B
New York, NY 10040
(212) 568-7307

(Address and Telephone Number of Principal Executive Offices and
Principal Place of Business)
----------------
Robert Scher
President, Growth Net, Inc.
900 W. 190th Street, Suite 4B
New York, NY 10040
(212) 568-7307

(Name, Address and Telephone Number, of Agent For Service)
----------------

Copies to:

Joel Schonfeld, Esq.

Andrea I. Weinstein, Esq.

Schonfeld & Weinstein, L.L.P.

63 Wall Street, Suite 1801

New York, New York 10005-3001

(212) 344-1600

<PAGE>

----------------
Approximate Date of Proposed Sale to the Public:

from time to time after the effective date of this Registration Statement as
determined by market conditions and other factors.

If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]

CALCULATION OF REGISTRATION FEE

TITLE OF EACH
CLASS OF
SECURITIES
TO BE AMOUNT TO OFFERING PRICE OFFERING AMOUNT OF
REGISTERED BE REGISTERED PER COMMON SHARES PRICE REGISTRATION FEE
---------- ------------- ----------------- ----- ----------------

Common Stock,
$.001 par value
per share 13,500,000(1) $.033253851(2) $448,927 $125

(1) Shares of common stock of registrant being distributed to shareholders of
USA Growth, Inc., a Delaware corporation (now known as World Shopping Network,
Inc.).

(2) Based upon book value per share of registrant on April 30, 2000, solely for
the purpose of calculating the registration fee pursuant to Rule 457(f)(2) of
the Securities Act of 1933, as amended.

The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.

<PAGE>

Prospectus

13,500,000 Shares of Common Stock,

Par Value $.001 Per Share

GROWTH NET, INC.

All of the shares of common stock of Growth Net, Inc., a Nevada corporation, are
held by USA Growth, Inc., a Delaware corporation (now known as World Shopping
Network, Inc.). All of the shares of common stock of USA Growth, Inc., as of
June 30, 1999, were held by the public. The transaction described in this
prospectus involves the distribution to the holders of the shares of common
stock of USA Growth, Inc. of record as of June 30, 1999 of all the shares of
common stock of Growth Net, Inc. on a share-for-share basis.

An investment in shares of our common stock involves a high degree of risk. WE
URGE YOU TO CAREFULLY CONSIDER THE RISK FACTORS BEGINNING ON PAGE 7.

Neither Growth Net, Inc. nor USA Growth, Inc. will receive any proceeds
from the distribution of the Growth Net, Inc. shares. The shares of common
stock of Growth Net, Inc. are not traded on any exchange or in the
over-the-counter market.

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.

The date of this prospectus is __________, 2000.

<PAGE>

TABLE OF CONTENTS

Page
----

Where You Can Find More Information ....................................... 2

Cautionary Statements ..................................................... 3

Prospectus Summary ........................................................ 4

Risk Factors .............................................................. 7

Foward-Looking Statements ................................................. 10

The Company ............................................................... 10

The Company's Parent ...................................................... 10

Use of Proceeds ........................................................... 11

Price Range of Company Shares ............................................. 11

Dividend Policy ........................................................... 11

Business .................................................................. 12

Plan of Operation ......................................................... 15

Description of Property ................................................... 15

Directors and Executive Officers .......................................... 16

Description of Securities ................................................. 17

Limitation of Liability and Indemnification ............................... 18

Certain Relationships and Related Transactions ............................ 18

Market for Common Stock and Related Shareholder Matters ................... 18

Executive Compensation .................................................... 19

Legal Proceedings ......................................................... 19

Legal Matters ............................................................. 19

Experts ................................................................... 19

Available Information ..................................................... 20

Index to Financial Statements ............................................. F-1

<PAGE>

WHERE YOU CAN FIND MORE INFORMATION

Growth Net, Inc. filed with the Securities and Exchange Commission a
registration statement on Form SB-2 to register the shares of common stock
of Growth Net, Inc. to be distributed to the holders of the shares of
common stock of USA Growth, Inc. of record as of June 30, 1999.

The registration statement and the exhibits and schedules may be inspected and
copied (at prescribed rates) at the Public Reference Room of the Commission at
Room 1024, Judiciary Plaza, 450 Fifth Street, NW, Washington, DC 20549. Please
call 1-800-SEC-0330 for further information on the public reference rooms in
other locations. Also, you can review this information at the Commission's
Electronic Data Gathering Analysis and Retrieval System (EDGAR), which is
available to the public through the Commission's web site: http://www.sec.gov.

This prospectus does not contain all of the information set forth in the
registration statement and exhibits. Statements contained in this prospectus
regarding the contents of any contract or other document referred to are not
necessarily complete, and in each instance reference is made to the copy of such
being qualified in its entirety by such reference. Growth Net will provide
without charge to each person who receives this prospectus, upon written or oral
request reference (excluding exhibits to the information that is incorporated by
reference unless the exhibits are themselves specifically incorporated by
reference) by contacting Growth Net, Inc. at 900 W. 190th Street, New York, New
York 10040, Attention: Robert Scher, telephone: (212) 568-7307.

Growth Net has not authorized any dealer, salesperson or other person to give
any information or represent anything not contained in this prospectus. You must
not rely on any unauthorized information. This prospectus does not offer to sell
or buy any shares in any jurisdiction where it is unlawful. The information in
this prospectus is current as of the date indicated on the cover.

2
<PAGE>

CAUTIONARY STATEMENTS

This prospectus contains statements relating to future results of Growth Net,
Inc. (including but not limited to certain projections and business trends) that
are "forward-looking statements." Actual results may differ materially from
those projected as a result of certain risks and uncertainties, including but
not limited to changes in political and economic conditions, ability to satisfy
capital requirements and competitive pressures.

"Growth Net", "we", "us", "our", "the registrant" or "the Company" means
Growth Net. Inc., a Nevada corporation. "USAG" means USA Growth, Inc., a
Delaware corporation (now known as World Shopping Network, Inc.).

3
<PAGE>

PROSPECTUS SUMMARY

THIS SUMMARY HIGHLIGHTS INFORMATION CONTAINED ELSEWHERE IN THIS PROSPECTUS. YOU
SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY, PAYING PARTICULAR ATTENTION TO THE
SECTION ENTITLED "RISK FACTORS" AND THE FINANCIAL STATEMENTS.

GENERAL

The purpose of this distribution is to allow us to pursue a different business
purpose than the business purpose of USAG and to make us a public company.

Each holder of common stock of USAG of record as of June 30, 1999 will receive
one share of our common stock on a share-for-share basis. In other words, for
each share of common stock of USAG held, the holder will receive one share of
our common stock. Neither we nor USAG will receive any consideration from the
recipients of our common stock. The distribution will occur on or about
___________, 2000.

The distribution of the shares of our common stock may be taxable as ordinary
income. To review the possible tax consequences in more detail, see "Risk
Factors -- Tax Consequences."

We are a development stage company and have not generated any revenues from
operations. For our fiscal year ended April 30, 2000, we experienced a net loss.
Our business plan consists of two parts:

1. to provide consulting services to primarily emerging growth companies, with
such services relating to website design, development and hosting, with a
particular emphasis on direct and interactive marketing through the Internet;
and

2. to provide guidance to small private and public companies relating to
financial management, capital formation, financial record keeping, public
relations and compliance with governmental reporting and filing requirements.

See "Business."

The shares of our common stock are not traded on any exchange or in the
over-the-counter market. The trading value of the shares of common stock of the
Company cannot be determined at this time and will depend on many factors. Until
an ordinary trading market develops, the market price for the shares of common
stock of the Company may fluctuate significantly. We expect public trading in
our common stock to begin on the Over-the-Counter Bulletin Board shortly
following the distribution, but cannot assure that a public market will develop.

4
<PAGE>

THE DISTRIBUTION

Common stock of the Company to be
distributed by USAG to the holders of
common stock of USAG of record as of
June 30, 1999 .............................................. 13,500,000 Shares

Common stock of the Company outstanding
prior to the distribution .................................. 13,500,000 Shares

Common stock of the Company outstanding
after the distribution ..................................... 13,500,000 Shares

Use of Proceeds ................................... No Proceeds to be Received

GROWTH NET SUMMARY FINANCIAL INFORMATION

(FOR FISCAL YEAR ENDED APRIL 30, 2000)

STATEMENT OF INCOME:

Revenue (not from operations) $ 18,644

Net income $ (6,745)

Weighted average number of shares of common
stock outstanding during period (see note 2 to
notes to financial statements) 13,500,000

BALANCE SHEET DATA:

Cash and cash equivalents $ 470,564

Accounts receivable $ 2,173

Deferred taxes (see note 3 to notes to $ 1,190
financial statements)

Total current assets $ 473,927

Total assets $ 473,927

Total liabilities $ 25,000

Total stockholders equity $ 448,927

5
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TAX CONSEQUENCES

ADDRESS AND TELEPHONE NUMBER

Our offices are located at 900 W. 190th Street, Suite 4B, New York, New York
10040. Our telephone number is (212) 568-7307.

6
<PAGE>

RISK FACTORS

YOU SHOULD CONSIDER CAREFULLY THE FOLLOWING RISKS BEFORE YOU DECIDE WHETHER TO
INVEST IN OUR SHARES OF COMMON STOCK. OUR BUSINESS, FINANCIAL CONDITION OR
RESULTS OF OPERATIONS COULD BE MATERIALLY AND ADVERSELY AFFECTED BY ANY OF THESE
RISKS. ANY OF THESE RISKS COULD CAUSE THE TRADING PRICE OF OUR COMMON STOCK TO
DECLINE, AND YOU COULD LOSE ALL OR PART OF YOUR INVESTMENT.

WE HAVE A HISTORY OF NO OPERATING REVENUES AND FOR THE FISCAL YEAR ENDED APRIL
30, 2000 WE EXPERIENCED A NET LOSS. IF WE DO NOT DEVELOP PROFITABLE OPERATIONS,
WE WILL NEED TO TERMINATE OUR OPERATIONS. AS A RESULT, YOU MAY LOSE YOUR ENTIRE
INVESTMENT.

FUTURE CAPITAL NEEDS

During our last fiscal year, which ended on April 30, 2000, we generated income
from interest on bank and mutual fund money market accounts. As we scale up our
operations, it is expected that funds from these accounts will be used, thereby
reducing interest income. Although current capital should be adequate for the
next 12 months, we may need to access outside sources of financing to support
our growth thereafter. There can be no assurance that any such financing will be
available. Even if such financing is available, it may involve issuing
securities senior to our common stock or involve equity financings which are
dilutive to the holders of our common stock.

DEPENDENCE ON CONTINUED GROWTH IN TECHNOLOGY AND THE INTERNET

Our future success is highly dependent upon the continued growth in the use of
technology and the Internet. Commercial use of the Internet is at an early stage
of development, and market acceptance of the Internet as a medium for
advertising, information services and commerce is subject to a high level of
uncertainty. The relative effectiveness of the Internet as an advertising medium
as compared to traditional advertising media, for example, has not been
determined. Furthermore, there can be no assurance that the required
infrastructure to support future Internet user and traffic growth or
complementary services necessary to make the Internet a viable commercial
marketplace will be developed, or, if they are developed, that the Internet will
become a viable commercial marketplace services such as those offered by us. If
commercial use of the Internet fails to continue to expand, our business,
results of operations and financial condition would be adversely affected.

7
<PAGE>

DEPENDENCE ON KEY PERSONNEL

Our performance is substantially dependent upon the performance of its two
executive officers and its ability to attract, train, retain and motivate high
quality personnel, especially highly qualified technical and managerial
personnel. The loss of the services of either of its current executive officers
could have a material adverse effect on our business, results of operations or
financial condition.

GOVERNMENT REGULATION AND LEGAL UNCERTAINTIES

We are not currently subject to direct regulation by any governmental agency,
other than regulations applicable to businesses generally. However, governmental
regulators may, in the future, seek to impose regulations on Internet
activities, as well as increase regulation in other already regulated areas
which have been attracting a large number of emerging growth companies, such as
telecommunications, biotechnology and healthcare. There are currently few laws
or regulations directly applicable to access to or commerce on the Internet. Due
to increasing popularity and use of the Internet, however, it is possible that a
number of laws and regulations may be adopted with respect to the Internet,
covering issues such as user privacy, pricing, characteristics and quality of
products and services. The adoption of any additional laws or regulations may
also decrease the growth of the industries of interest, which could in turn
decrease the demand for our services or could increase our cost of doing
business. Moreover, the applicability to the Internet of a range of existing
laws in domestic and international jurisdictions governing issues such as
commerce, taxation, property ownership, defamation and personal privacy is
uncertain and will likely evolve over the course of many years. Any new
legislation or regulation or application or interpretation of existing laws
regarding internet or other emerging growth industries, including tax laws,
could have an adverse effect on our business, results of operations and
financial condition.

INTENSE COMPETITION

The market for our services is highly competitive and lacks significant barriers
to entry. We expect competition to intensify in the future. Numerous
well-established companies and smaller entrepreneurial companies are focusing
significant resources on developing and marketing services that will compete
with our services. There can be no assurance that we will be able to compete
successfully or that competitive pressures, including possible downward pressure
on the prices we may charge for our services, will not adversely affect our
business, results of operations and financial condition.

LACK OF OPERATING HISTORY

From our inception through the date of this prospectus, we have been a
development stage company and have not generated any income from operations.

LACK OF MARKET FOR COMMON EQUITY SECURITIES.

The shares of our common stock are not traded on any exchange or in the
over-the-counter market.

8
<PAGE>

RESTRICTIONS UNDER PENNY STOCK RULES

We expect to include our shares on the over-the-counter market. For the
immediate future, our shares would become subject to the penny stock rules under
the Securities Exchange Act of 1934. We will continue to be subject to these
rules until the price of our stock exceeds $5.00, or until we maintain minimum
tangible net worth of at least $2 million or average revenues of $6,000,000.

The penny stock rules require broker-dealers to deliver a standardized risk
disclosure document prepared by the Commission prior to a transaction in a penny
stock. This document provides information about penny stocks and the risks in
the penny stock market. The broker-dealers must also provide the customer the
following:

* current bid and offer quotations for the penny stock;

* the compensation of the broker-dealer and its salesperson in the
transaction; and

* monthly account statements showing the market value of each penny stock
held in the customer's account.

The broker-dealer must give the quotations and compensation information to the
customer, orally or in writing, prior to completing the transaction. They must
give this information to the customer, in writing, before or with the customer's
confirmation.

In addition, the penny stock rules require that, prior to a transaction in a
penny stock, the broker and/or dealer must make a special written determination
that the penny stock is a suitable investment for the purchaser. The broker
and/or dealer must receive the purchaser's written agreement to the transaction.
These disclosure requirements may reduce the level of purchases in our common
stock and trading activity in the secondary market for our common stock. If our
common stock becomes subject to the penny stock rules, it will be more difficult
for you to sell our common stock. This may reduce the value of your shares.

TAX CONSEQUENCES

Neither we nor, to our knowledge, USAG has requested a ruling from the Internal
Revenue Service or any other governmental authority regarding whether the
distribution of the shares of our common stock will or will not result in a
taxable gain or income to the holders of the shares of common stock of USAG or
record as of June 30, 1999. In addition, we have not engaged legal counsel to
study this question or to provide us with advice. We believe that the
distribution will be a taxable event to these holders. Consequently,
non-corporate holders could be required to report taxable gain or income based
upon the fair market value of the shares of our common stock on the date of the
distribution. Since an active trading market for such shares may not develop
which could provide the such holders with a sufficient degree of liquidity, it
is possible that such holders may not be able to sell their shares readily in
order to offset any potential tax liability as a result of the distribution.

9
<PAGE>

FORWARD LOOKING STATEMENTS

Some of the statements contained in this prospectus are forward-looking and may
involve a number of risks and uncertainties. These statements are subject to
known and unknown risks, uncertainties and other factors that could cause our
actual results to differ materially from those contemplated by the statements.
We caution you that these forward-looking statements are only predictions. We
cannot assure you that the future results predicted, whether expressed or
implied, will be achieved. The forward-looking statements are based on current
expectations, and we are not obligated to update this information.

THE COMPANY

On May 10, 1999, USAG caused the incorporation of the Company. On May 11, 1999,
USAG subscribed for 1,000 shares common stock, par value $.001 per share, of the
Company (the "Common Stock"). On June 30, 1999, USAG subscribed for an
additional 13,499,000 shares of Common Stock (such shares, together with the
original 1,000 shares, are hereinafter referred to as the "Company Shares"). As
payment for the Company Shares, USAG transferred to the Company all of USAG's
assets, which assets were comprised solely of cash and cash equivalents and, at
such date, amounted to approximately $456,000. Also on June 30, 1999, USAG
declared a distribution to the holders of the shares of common stock of USAG of
record as of that same date (the "USAG Holders") of one share of Common Stock
for each share of common stock of USAG held. Such distribution is payable within
10 business days following the effective date of the registration statement
relating to this prospectus. As of the record date, all of the USAG Holders held
13,500,000 shares of common stock of USAG.

From its inception through the date of this prospectus, the Company has been a
development stage company and has not generated any revenues from operations.
For the fiscal year ended April 30, 2000, we experienced a net loss. The Company
is seeking to provide consulting services to businesses selling services over
the Internet and consulting services to small private and public companies which
need assistance with respect to financial management, capital formation,
financial record keeping, public relations and compliance with governmental
reporting and filing requirements. See "Business." The Company has no
liabilities and, as of the date of this prospectus, has assets of approximately
$474,000, of which approximately $471,000 is cash and cash equivalents.

THE COMPANY'S PARENT

USAG, the parent of the Company and the present holder of the Company Shares,
was incorporated on August 14, 1987 and is publicly held. From its inception
through June 30, 1999, USAG had been engaged in research, internally and through
the use of independent contractors, to determine what new venture could be
established by USAG which would have potentially high profits. On June 30, 1999,
USAG entered into a Share Exchange Agreement with TriStar Diversified Ventures,
L.L.C., John J. Anton and Nick Markulis, pursuant to which TriStar and Messrs.
Anton and Markulis exchanged, in the aggregate, approximately 59% of the issued
and outstanding common stock of World Shopping Network, Inc., a Wyoming
corporation ("WSN Wyoming"), for approximately 86% of the issued and outstanding
common stock of USAG. As a result of the consummation of the Share Exchange
Agreement, WSN Wyoming became a majority owned subsidiary of USAG.

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<PAGE>

On October 1, 1999, WSN Wyoming was merged with and into USAG, and USAG was the
surviving corporation. Contemporaneously, USAG changed its name to World
Shopping Network, Inc. To the Company's knowledge, USAG continues to be publicly
held and files periodic reports with the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended (the "Exchange Act").

USE OF PROCEEDS

In the distribution, neither the Company nor USAG will receive cash or other
consideration for the Company Shares. The Company Shares will be distributed to
the USAG Holders pursuant to a resolution of the board of directors of USAG
dated June 30, 1999.

PRICE RANGE OF COMPANY SHARES

There is no established public market for the securities of the Company,
including the Company Shares. At the present time, the Company intends to seek
to have the Company Shares traded in the over-the-counter market, but can there
be no assurance that a public market for the securities of the Company,
including the Company Shares, will develop.

DIVIDEND POLICY

The Company expects to retain any and all earnings generated by operations for
the development and growth of the business of the Company, and does not
anticipate paying any cash dividends to shareholders in the foreseeable future.
The payment of future dividends and the rate of such dividends, if any, will be
determined by the board of directors of the Company in light of the Company's
earnings, financial condition, capital requirements and other factors.

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<PAGE>

BUSINESS

GENERAL

The Company was formed on May 10, 1999 in anticipation of the reorganization of
its parent, USAG. From its inception through the date of this prospectus, the
Company has been a development stage company and has not generated any revenues
from operations. For its fiscal year ended April 30, 2000, the Company
experienced a net loss.

The Company's business plan consists of two parts, as follows:

1. To provide consulting services to primarily emerging growth companies, with
such services relating to website design, development and hosting, with a
particular emphasis on direct and interactive marketing through the Internet
(the "Internet Business Plan").

2. To provide guidance to small private and public companies relating to
financial management, capital formation, financial record keeping, public
relations and compliance with governmental reporting and filing requirements
(the "Financial Consulting Business Plan" and, together with the Internet
Business Plan, the "Business Plan").

Under the Internet Business Plan, the Company seeks to provide a complete
package of services to its clients. To help accomplish this, the Company intends
to subcontract, or "outsource," many of the specialties that will be required.
In furtherance of this outsourcing approach, the Company executed in May 2000 a
Sales Marketing Agreement with Dynamic Net, Inc. ("Dynamic"), of Womelsdorf, PA.
The Company believes that Dynamic has significant experience in website design,
development and hosting, and that the agreement with Dynamic will enhance the
Company's ability to provide these services to prospective clients.

Under the Financial Consulting Business Plan, the Company initially expects to
benefit from the experience of its officers with small companies, both public
and private. The Company believes it will be able to provide the necessary
support to these companies on a cost-effective basis by offering them a special
customized support service at a fixed price. This service -- which is currently
contemplated to include business planning advice, assistance with the
preparation of corporate profile literature and introductions to funding sources
-- will be attractive, the Company believes, to organizations on limited budgets
which are seeking funding or are considering a public offering. For companies
already public, it would provide competitively priced administrative services
such as record keeping and preparation and filing of SEC reports, as well as
investor relations and marketing support.

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INTERNET BUSINESS PLAN

INTERACTIVE MARKETING INDUSTRY. Direct marketing is undergoing rapid,
fundamental change as customers' needs evolve and technology advances. Marketing
channels and media outlets are expanding in number and diversifying in scope,
and powerful database technologies are able to target both broad markets and
individual customers with ever-greater precision. The emergence of the Internet
into homes and offices has provided direct marketers with a powerful new
distribution mechanism -- interactive marketing. Interactive marketing is a
subset of direct marketing. It is different from traditional direct marketing in
that the consumer has flexibility and control over what is being presented and
when.

In contrast to marketing using conventional media, the Internet offers
capabilities to target advertising to specific audiences, to measure the
popularity of content, to reach worldwide audiences cost-effectively and to
create more innovative and interactive advertisements. By collecting customer
feedback and demographic information, advertisers can direct highly customized
marketing campaigns at prospective customers much more rapidly than with
conventional media. The Company believes that advertisers will continue to seek
to advertise on web sites that offer a high volume of traffic and feature
flexible advertisement programs capable of reaching targeted audiences.
Likewise, the Company believes that as advertisers increasingly embrace the
Internet as an advertising vehicle, the advertisers' participation will
subsidize in part the creation and expansion of the information and resources
available on the web which in turn is expected to stimulate further traffic
flow.

COMPETITION. The Company will compete in areas which are comprised of numerous
small and large companies providing different and new technologies to clients,
all with varying applications. The market for Internet services is highly
competitive. In addition, the Company expects the market for Internet
advertising, to the extent it further develops, to be intensely competitive.
Although the Company believes that the diverse Plans of the Internet market will
provide opportunities for more than one supplier of services similar to those of
the Company, it is possible that a single supplier may dominate one or more
market Plans.

The Company's contemplated services under the Internet Business Plan are
predominantly for emerging growth companies. Competitors would include a wide
variety of companies and organizations, including Internet service and
technology companies, public relations firms and a variety of specialty
consulting organizations. The Company believes that many of the Company's
existing competitors, as well as a number of potential new competitors, have
significantly greater financial, technical and marketing resources than the
Company.

There can be no assurance that the Company's competitors will not develop more
cost-effective services that are in general superior to those of the Company or
that achieve greater market acceptance than those of the Company. There can be
no assurance that the Company will be able to compete successfully against its
current or future competitors or that competition will not have a material
adverse effect on the Company's business, results of operations and financial
condition.

SALES AND MARKETING. The Company intends to market its services under the
Internet Business Plan initially through its management and later through a
small marketing staff using both telemarketing and direct sales personnel. The
Company currently intends to develop and maintain separate marketing staffs for
each Internet service area, enabling the marketing personnel to develop strong
customer relationships and expertise in their respective areas. The Company
intends to establish a direct sales force experienced in the advertising
business to address the new and evolving requirements of the Internet
advertising market. The Company currently believes that an experienced sales
staff is critical to initiating and maintaining relationships with advertisers
and advertising agencies and therefore intends to hire a portion of its Internet
advertising sales force from the advertising industry. The Company plans to
advertise its services through direct mail, space advertising, Internet banners,
directory listings, trade shows and Company sponsored user groups. In addition,
in certain instances, the Company will complement the activities of its direct
sales force by retaining advertising sales agencies to serve as sales
representatives on a commission basis.

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The Company will attend trade shows in the Internet, high technology and direct
marketing, while further supplementing its sales efforts with space advertising
and services listings in appropriate directories. The Company also expects to
conduct mailings of flyers, newsletters and other service information throughout
the year to primarily book, magazine, journal, newsletter and software
publishers and resellers, seminar companies, professional associations, business
supply catalogers, and consumer electronic, high technology, healthcare and
financial service organizations.

FINANCIAL CONSULTING BUSINESS PLAN

FINANCIAL CONSULTING INDUSTRY. How companies provide financial consulting advice
is undergoing rapid, fundamental change as a result of technology advances and
the concomitant restructuring of business and industry in general over the last
few years. In addition to major accounting firms which have created their own,
independent consulting firms, the Company believes that almost every major
financial institution offers some form of financial planning assistance to
individuals and businesses. Furthermore, numerous new enterprises have been
created to empower small businesses and individuals with the ability to do their
own planning and record keeping with computer programs and specialized Internet
sites. There are also numerous individuals and organizations which refer to
themselves "financial consultants" or "public relations firms" and which offer
assistance in obtaining funds and developing markets for small public companies.

COMPETITION. Numerous small and large companies -- with far greater
capitalization and experience than the Company -- already provide financial
consulting services to small private and public companies, including emerging
growth companies. The Company will compete in this market, and there are no
assurances that the Company will be able to succeed. Although the market for the
services the Company intends to provide is highly competitive, the Company
believes that it can provide quality, affordable financial consulting services
by bundling a variety of financial services such as record keeping, SEC
reporting, business plan preparation, investor relations and Internet support
into one, flat-rate package. The Company hopes to create demand for its services
over time and to slowly gather market share.

SALES AND MARKETING. Like under the Internet Business Plan, the Company intends
to market its financial consulting services initially through its management and
later through a small marketing staff, which staff will use both telemarketing
and direct sales personnel. The Company currently intends to develop and
maintain separate marketing staffs for each financial consulting service area,
enabling the marketing personnel to develop strong customer relationships and
expertise in their respective areas. The Company intends to establish a direct
sales force experienced in the financial consulting business to address the new
and evolving requirements of the companies in this market.

Again, like under the Internet Business Plan, the Company plans to advertise its
services through direct mail, space advertising, Internet banners, directory
listings and trade shows.

14
<PAGE>

INTELLECTUAL PROPERTY AND OTHER RIGHTS

The Company does not have now any patents, trademarks, licenses, franchises,
concessions, royalty agreement or labor contracts.

PERSONNEL

As of the date of this prospectus, the Company employs only its two officers.
Each of them serves on a part-time, non-salaried basis. See "Director and
Executive Officers." The Company believes it will have access to additional
persons pursuant to a sales marketing agreement with Dynamic, which, the Company
has been advised, has performed large scale Internet-related projects for major
corporations. In addition, depending on client demand, the Company intends to
contract with additional persons on a temporary, part-time basis. It is expected
that the Company's marketing staff will be developed with some full-time
persons.

PLAN OF OPERATION

Because the Company currently has no payroll requirements and because the
Business Plan calls primarily for outsourcing of work when clients engage the
Company, limited financial resources are necessary for research or development
or for the acquisition of equipment over the next 12 months. Any expenditures
over this 12 month period are expected to be satisfied by existing cash held by
the Company.

DESCRIPTION OF PROPERTY

As of the date of this prospectus, the Company owns no real or personal
property.

15
<PAGE>

DIRECTOR AND EXECUTIVE OFFICERS

The director and executive officers of the Company are as follows:

NAME AGE POSITION
---- --- --------

Robert Scher 58 Chairman of the Board of Directors; President; Treasurer

J. Peter Hans 55 Secretary

Mr. Scher has been Chairman of the Board of Directors, President and
Treasurer of the Company since May 10, 1999. From July 1995 through June
1999, Mr. Scher served as Chairman of the Board of Directors, President and
Treasurer of USAG; from 1986 through 1989, he served as Chairman of the
Board of Directors, President and Treasurer of Hunter Industrial
Facilities, Inc.; and from 1985 through 1986, he served as Chairman of the
Board of Directors, President and Treasurer of World Television Inc. Each
of the foregoing companies was publicly held. Since August 1999, Mr. Scher
has served as Chairman of the Board of Directors of Pathway Corporation.
Mr. Scher served as an Associate Accountant with the New York City Health
and Hospitals Corporation from 1971 through 1999. Mr. Scher earned a B.A.
in Accounting in 1963 from the City University of New York, Baruch College.

Mr. Scher is currently a tax and investment consultant. Mr. Scher currently
devotes approximately 20% of his time to activities of the Company, and the
Company expects that this could increase to up to 50% if the Company is
able to successfully carry out the Business Plan.

J. Peter Hans has served as Secretary of the Company since May 10, 1999. He
served as a Director and Secretary of USAG from, respectively, 1987 through 1995
and 1995 through June 1999. Since 1994, Mr. Hans has been self employed as a
financial consultant, and, since 1998 has been affiliated as a commercial
mortgage broker with Meridian Capital Group, LLC, of Englewood Cliffs, New
Jersey. From 1979 to 1990 and from 1990 to 1994, respectively, Mr. Hans was
employed by Bank Leumi and UMB Bank as Vice President and in various other
positions. Mr. Hans holds a bachelor's degree in Economics from Yeshiva
University and has completed graduate work in international economics and
finance. It is currently expected that Mr. Hans will devote approximately 10% of
his time to activities of the Company.

At this time, neither Mr. Scher nor Mr. Hans is receiving a salary or other
compensation from the Company, and there are no other employees of the
Company.

16
<PAGE>

DESCRIPTION OF SECURITIES

GENERAL

The Company's authorized capital stock consists of 200,000,000 shares of Common
Stock and 10,000,000 shares of blank check Preferred Stock, par value $.001 per
share. Both prior to and upon completion of the distribution, 13,500,000 shares
of Common Stock will be issued and outstanding.

The following summary description of the capital stock of the Company is
qualified in its entirety by reference to the Company's Articles of
Incorporation (the "Articles of Incorporation") and By-Laws (the "By-Laws"),
copies of which are filed as exhibits to the registration statement relating to
this prospectus.

COMMON STOCK

The holders of Common Stock are entitled to one vote per share owned of record
on all matters submitted to a vote of the shareholders, including the election
of directors. Holders of Common Stock have no cumulative voting rights. Holders
of Common Stock on the applicable record date are entitled to receive ratably
such dividends, if any, as may be declared from time to time by the Board of
Directors out of funds legally available therefor. See "Dividend Policy." Upon
liquidation, dissolution or winding up of the Company, the holders of Common
Stock are entitled to share pro rata in any distribution of the Company's assets
remaining after payment of all debts and other liabilities subject to any
superior rights of holders of any outstanding Preferred Stock. The holders of
Common Stock have no preemptive or conversion rights or other subscription
rights, and there are no redemption or sinking fund provisions with respect to
the Common Stock. All of the issued and outstanding shares of Common Stock are,
and the shares of Common Stock distributed hereby will be when distributed,
fully paid and nonassessable.

PREFERRED STOCK

The Board of Directors has authority (without action of the stockholders) to
issue the authorized and unissued Preferred Stock from time to time in one or
more series, to designate the number of shares constituting any such series, and
to fix, by resolution, the voting powers, designations, preferences, and
relative, optional or other special rights thereof, including liquidation
preferences and the dividend conversion and redemption rights of each such
series. Under certain circumstances, the Company could issue this Preferred
Stock as a method of discouraging, delaying or preventing a change of control of
the Company. The Company has no present plans to issue any Preferred Stock.

TRANSFER AGENT

The Company currently serves as its own transfer agent and registrar, but
currently intends to designate a third party transfer agent and registrar prior
to the distribution of the Company Shares.

17
<PAGE>

LIMITATION OF LIABILITY AND INDEMNIFICATION

The Nevada General Corporation Law (the "NGCL") permits a corporation to
indemnify its directors, officers, employees and other agents in terms
sufficiently broad to permit indemnification (including reimbursement for
expenses) under certain circumstances for liabilities arising under the
Securities Act of 1933, as amended (the "Securities Act").

The Company's Articles of Incorporation and By-Laws provide for the
indemnification of any and all persons whom it shall have power to indemnify
under the NGCL from and against any and all of the expenses, liabilities or
other matters referred to or covered in the NGCL.

Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the Company
pursuant to the foregoing provisions, or otherwise, the Company has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable.

CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS

USAG holds and is distributing in this distribution to the USAG Holders,
pro-rata, the Company Shares, which shares represent 100% of the issued and
outstanding capital stock of the Company.

MARKET FOR COMMON STOCK AND
RELATED STOCKHOLDER MATTERS

The Company Shares are not traded on any exchange or in the over-the-counter
market. As of the date of this prospectus, the only securities of the Company
which are issued and outstanding are the Company Shares. There are no options or
warrants to purchase, or securities convertible into, Common Stock issued or
outstanding. As of June 30, 1999, there were approximately 1,200 USAG Holders
and, as a result, immediately after the distribution, there will be
approximately 1,200 holders of the Company Shares.

18
<PAGE>

In general, Rule 144 permits a shareholder who has beneficially owned restricted
shares of common stock for at least one year to sell without registration,
within a three-month period, a number of shares not exceeding the greater of 1%
of the then outstanding shares of common stock or, if the common stock is quoted
on NASDAQ, the average weekly trading volume over a defined period of time,
assuming compliance by the issuer with certain reporting requirements of Rule
144. Furthermore, if the restricted shares of common stock are held for at least
two years by a person not affiliated with the issuer (in general, a person who
is not an executive officer, director or principal shareholder of the issuer
during the three-month period prior to resale), the restricted shares can be
sold without any volume limitation. Any sales of shares by shareholders under
Rule 144 may have a depressive effect on the price of an issuer's common stock.

EXECUTIVE COMPENSATION

Neither of the executive officers of the Company are currently receiving
compensation for their services to the Company, and neither of them holds,
either of record or beneficially, any securities of the Company.

LEGAL PROCEEDINGS

The Company is not a party to any pending legal proceeding and its property is
not the subject of any pending legal proceeding.

LEGAL MATTERS

Certain legal matters with respect to the legality of the issuance of the
Company Shares to be distributed hereby will be passed upon for the Company by
Schonfeld & Weinstein, L.L.P., New York, New York.

EXPERTS

The financial statements of the Company at April 30, 2000 in this prospectus and
the registration statement relating hereto have been audited by Robert S. Graff,
Certified Public Accountant, Port Washington, New York, as set forth in his
report thereon appearing elsewhere herein and in the registration statement, and
are included in reliance upon such report given upon the authority of such
certified public accountant as an expert in accounting and auditing.

19
<PAGE>

AVAILABLE INFORMATION

We intend to furnish our shareholders annual reports, which will include
financial statements audited by an independent accountant, and all other
periodic reports as we may determine to furnish or as may be required by law,
including Sections 13(a) and 15(d) of the Exchange Act.

We have filed with the SEC a registration statement on Form SB-2 under the
Securities Act with respect to the securities to be distributed in accordance
with this prospectus. This prospectus does not contain all the information set
forth in the registration statement and the accompanying exhibits, as permitted
by the rules and regulations of the SEC. For further information, please see the
registration statement and accompanying exhibits. Statements contained in this
prospectus regarding any contract or other document which has been filed as an
exhibit to the registration statement are qualified in their entirety by
reference to these exhibits for a complete statement of their terms and
conditions. The registration statement and the accompanying exhibits may be
inspected without charge at the offices of the SEC and copies may be obtained
from the SEC's principal office at 450 Fifth Street, N.W., Washington, D.C.
20549 or at its regional offices located at 7 World Trade Center, 13th Floor,
New York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661, upon payment of the fees prescribed by the SEC. Electronic
reports and other information filed through the Electronic Data Gathering,
Analysis and Retrieval System, known as EDGAR, are publicly available on the
SEC's website, http://www.sec.gov.

20
<PAGE>

GROWTH NET, INC.

INDEX TO FINANCIAL STATEMENTS

Report of Robert S. Graff, Certified Public Accountant .................... F-2

Balance Sheet as of April 30, 2000 ....................................... F-3

Statement of Income from Inception through April 30, 2000 ................ F-4

Statement of Stockholders' Equity as of April 30, 2000 .................... F-5

Statement of Cash Flows from Inception through April 30, 2000 ............. F-6

Notes to Financial Statements ............................................ F-7

<PAGE>

ROGER S. GRAFF

CERTIFIED PUBLIC ACCOUNTANT

27 CONCORD ROAD

PORT WASHINGTON, N.Y. 11050

(516) 944-8558

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT

To the Board of Directors and Stockholders of Growth Net, Inc.

I have audited the accompanying balance sheet of Growth Net, Inc. (a development
Stage Company) as of April 30, 2000 and the related statements of income,
stockholders' equity and cash flows for the period of inception, May 10, 1999,
until April 30, 2000. These financial statements are the responsibility of the
Company's management. My responsibility is to express an opinion on these
financial statements based on my audit.

I conducted my audit in accordance with generally accepted accounting standards.
These standards require that I plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the 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.
I believe that my audit provides a reasonable basis for my opinion.

In my opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Growth Net, Inc. as at April 30,
2000 and the results of its operations and cash flows for the period so stated
in conformity with generally accepted accounting principles.

Roger S. Graff, CPA (NY)
Port Washington, NY
July 21, 2000

F-2
<PAGE>
<TABLE>
<CAPTION>

GROWTH NET, INC.

(A Development Stage Company)

BALANCE SHEET

April 30, 2000

(Audited)

ASSETS

CURRENT ASSETS

<S> <C>
Cash and cash equivalents $ 470,564

Accounts Receivable 2,173

Total current assets 472,737

Deferred Taxes (Note 3) 1,190
---------
TOTAL ASSETS $ 473,927
=========

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES

Accrued Expenses $ 25,000

Total current liabilities 0
---------

TOTAL LIABILITIES $ 25,000
=========

STOCKHOLDERS EQUITY

Common stock,$.001 par value,
200,000,000 shares authorized,
13,500,000 shares issued and
outstanding at April 30,2000 13,500

Additional paid-in capital 442,172

Deficit accumulated
during the development stage (6,745)

Total stockholders' equity $ 448,927
---------

TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 473,927
=========
</TABLE>

The accompanying notes are an integral part of this statement.

F-3
<PAGE>
<TABLE>
<CAPTION>

GROWTH NET, INC.

(A Development Stage Company)

STATEMENT OF INCOME

Cumulative May 10, 1999
(Date of Inception)
to April 30, 2000

<S> <C>
REVENUE $ 18,644

EXPENSES: 26,579

INCOME (LOSS) 7,935

INCOME TAXES:

Federal 1,190

State 0

NET INCOME (LOSS) (6,745)

NET INCOME (LOSS) PER SHARE
OF COMMON STOCK .0005
WEIGHTED AVERAGE NUMBER OF
SHARES OF COMMON STOCK
OUTSTANDING DURING THE
PERIOD (Note (2)) 13,500,000

</TABLE>

The accompanying notes are an integral part of this statement.

F-4
<PAGE>

GROWTH NET, INC.

(A Development Stage Company)

STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

FOR THE PERIOD FROM (INCEPTION) MAY 10, 1999
THROUGH APRIL 30, 2000

Common Stock Capital in Excess of Accumulated
---------------------------------------------

Shares Amount Par Value Deficit Total

------ ---------- ----------- ---------- ----------

<S> <C> <C> <C> <C> <C>
Common Stock Issued 13,500,000 $ 13,500 $ 442,172 $ 455,672

Net Income (Loss) $ (6,745) (6,745)

------------ ------------ ------------ ------------ ------------

Balance Apr. 30, 2000 13,500,000 $ 13,500 $ 442,172 $ (6,745) $ 448,927
============ ============ ============ ============ ============

The accompanying notes are an integral part of this statements.

F-5

</TABLE>
<PAGE>
<TABLE>
<CAPTION>

GROWTH NET, INC.

(A Development Stage Company)

STATEMENTS OF CASH FLOWS

THE PERIOD FROM INCEPTION (MAY 10, 1999) TO APRIL 30, 2000

Cumulative May 10,1999

May 10, 1999 to
(Date of Inception) April 30, 2000

April 30, 2000

Cash Flows From Operating Activities:

<S> <C>
Net Income $ (6,745)

Deferred Asset (1,190)

Accrued Expense 25,000

Net cash provided by (used in)
operations 17,065

Cash flows from financing activities:

Issuance of common stock 455,672

Receivable (2,173)

Net cash provided by (used in)
financing activities 453,499

Net increase (decrease) in cash and
cash equivalents 470,564

Beginning cash and cash equivalents -

Ending cash and cash equivalents $ 470,564

</TABLE>

The accompanying notes are an integral part of this financial statement.

F-6
<PAGE>

GROWTH NET, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS
April 30, 2000

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DEVELOPMENT STAGE COMPANY
-------------------------

Growth Net, Inc. (a development stage company) (the "Company") was incorporated
under the laws of the State of Nevada on May 10, 1999. The current registered
office of the Company is 502 East John St., Carson City, NV 89706. The current
principal office of the corporation is 502 East John St., Carson City, NV 89706.
The Company is a new enterprise in the development stage as defined by Statement
No. 7 of the Financial Accounting Standards Board and has not engaged in any
business other than organizational efforts. It has no full-time employees and
owns no real property. The Company intends to operate as a consultant to
emerging growth companies.

ACCOUNTING METHOD
-----------------

The Company records income and expenses on the accrual method.

FISCAL YEAR
-----------

The fiscal year end of Company is the calendar year ending April 30.

INCOME PER SHARE
----------------

Income per share was computed using the weighted average number of shares
outstanding during the period.

STATEMENT OF CASH FLOWS
-----------------------

For purposes of the statement of cash flows, the Company considers all highly
liquid debt instruments purchased with an original maturity of three month or
less to be cash equivalents.

USE OF ESTIMATES
----------------

The preparation of the Company's financial statements in conformity with
generally accepted accounting principals requires the Company's management to
make estimates and assumptions that effect the amounts reported in these
financial statements and accompanying notes. Actual results could differ from
those estimates.

STOCK BASIS
-----------

Shares of common stock issued for other than cash have been assigned amounts
equivalent to the fair value of the service or assets received in exchange.

2. STOCKHOLDERS' EQUITY

In anticipation of a reorganization and the acquisition of World Shopping
Network by USA Growth Inc., all assets of USA Growth Inc. were transferred
to its subsidiary, Growth Net Inc. on June 30, 1999. A total of $455,672
was transferred to Growth Net Inc. as an equity purchase of 13,500,000
shares of its common stock.

3. INCOME TAXES

The Company has Federal net operating loss carry forward of approximately $7,935
expiring in the year. The tax benefit of these net operating losses is
approximately $1,190 and is carried as a deferred asset.

4. ACCOUNTS RECEIVABLE

The sum of $2,173 is a liability of World Shopping Network, Inc. as part of its
contribution to the capital of Growth Net, Inc. The liability arose as a result
of an anticipated tax refund to World Shopping Network, Inc. Until paid, it is
considered a contingent asset.

F-7