<PAGE> 1
ANNUAL REPORT FOR SMALL BUSINESS ISSUERS SUBJECT
TO THE 1934 ACT REPORTING REQUIREMENTS
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM 10-KSB/A
/X/ ANNUAL REPORT PURSUANT TO Section 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
or
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _________ to ___________
Commission File Number 0-15807
HEALTH & LEISURE, INC.
(Name of Small Business Issuer in its charter)
Delaware 31-1190725
- ------------------------------- ------------------------------------
(State of other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
203 East Broad Street, Columbus, Ohio 43215
- --------------------------------------- ----------
(Address of principal executive office) (Zip Code)
Issuer's telephone number: (614) 228-2225
--------------------
Securities registered pursuant to Section 12(b) of the Act:
<TABLE>
<CAPTION>
Name of each exchange
Title of each class on which registered
- ------------------- -------------------
<S> <C>
None None
- ------------------- -------------------
</TABLE>
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $0.01 par value per share
---------------------------------------------
(Title of class)
Indicate by check mark whether the Issuer (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the Issuer
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
----- -----
Check if disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of Issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. /X/
<PAGE> 2
State Issuer's revenues for its most recent fiscal year. $59,065
-----------
There are no recent quotes available for the Registrant's common stock.
Accordingly, the Registrant is unable to determine the aggregate market value of
the voting stock held by nonaffiliates of the Registrant as of any recent date.
On March 27, 1996, the Issuer had outstanding 17,325,427 shares of
common stock, $0.01 par value, which is the Issuer's only class of common stock.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
PART I 1
ITEM 1. BUSINESS 1
ITEM 2. PROPERTIES 3
ITEM 3. LEGAL PROCEEDINGS 3
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 3
PART II 4
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS 4
ITEM 6. PLAN OF OPERATION 4
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 5
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
AND FINANCIAL DISCLOSURE 5
PART III 6
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT 6
ITEM 10. EXECUTIVE COMPENSATION 8
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT 8
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 10
PART IV 11
ITEM 13. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND
REPORTS ON FORM 8-K 11
SIGNATURES 14
EXHIBIT INDEX 18
</TABLE>
<PAGE> 4
PART I
ITEM 1. BUSINESS
Background
The Company was incorporated on March 13, 1985, under the laws of the
State of Utah with the name Univenture Capital Corp. The Company was organized
to engage in any lawful business and had no specific business plan except the
investigation, analysis, and possible acquisition of business opportunities.
On August 29, 1986, the Company acquired all of the outstanding stock
of Health & Leisure Inc., a Delaware corporation which subsequently changed its
name to Entre Vest, Inc. ("Entre Vest"), in a transaction in which a subsidiary
of the Company merged with and into Entre Vest and the former stockholders of
Entre Vest obtained a controlling interest in the Company. The Company
subsequently changed its own name from Univenture Capital Corp. to Health &
Leisure, Inc. and changed its state of incorporation from Utah to Delaware.
Entre Vest was incorporated on June 6, 1985, under the laws of the State of
Delaware. (The Company and its subsidiaries are referred to herein as the
"Company.")
Heat Pads
In July 1987, the Company began marketing to the general public, in the
United States, disposable chemical heat pads (the "heat pads") as hand and body
warmers. The heat pads were marketed under various names and various package
styles. The heat pads are small spun bonded fabric and paper packets of various
sizes and are able to emit heat for periods ranging between four hours and
twenty hours. The heat produced by a heat pad results from an exothermic
chemical reaction which is triggered by exposing the pad to air upon its removal
from its airtight packaging. The Company focused its marketing efforts on
distribution through various chain retail stores and through medical supply
houses for various heat therapy uses. All of the Company's operations in
connection with importing and distributing the heat pads were conducted through
its wholly-owned Ohio subsidiary, H & L Concepts, Inc. The market for the heat
pads did not develop on a scale anticipated by management, the distribution of
the heat pads did not result in profitable operations and the Company has
discontinued this line of business.
Marketing of AT&T Long Distance Telephone Services
From March 1990 to December 1991, the Company marketed long distance
telephone services of AT&T. Initially, this business was conducted through a
wholly-owned Delaware subsidiary, AmTele, Inc. ("AmTele"). From December 1990
through December 1991, this business was conducted through a joint venture
formed by AmTele and Kaplan Enterprises, Inc., a California corporation
unaffiliated with the Company ("KEI"). The joint venture was formed to provide
needed capital and KEI contributed $400,000 to the joint venture and AmTele
contributed its business operations. To provide its services, the Company
contracted with AT&T to obtain its own private telephone network under AT&T's
Software Defined Network ("SDN") service. SDN uses computer controlled switching
systems to provide its SDN customers with the benefits of a private telephone
network. The Company marketed to its customers the ability of obtaining AT&T
long distance telephone services through the Company's private SDN network. The
benefit to customers of obtaining telephone services through the Company's
network was that customers paid less expensive long distance telephone rates.
The Company was to earn its revenues from discount rebates to be received from
AT&T based on the volume of the Company's customers' long distance telephone
usage.
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<PAGE> 5
The Company encountered a number of substantial difficulties in the
operation of its telephone service business including without limitation delays
in processing by AT&T and delays in payment by AT&T. As a result, the Company
received revenues only sporadically and not in sufficient amounts to cover
operating costs. In October 1991, KEI received a larger share of the joint
venture (70%) in exchange for providing additional capital. In February 1992,
AmTele decided to exit the telephone service business and transferred its
partnership interest in the joint venture to KEI in exchange for a full release
of liability and an indemnification. As a result, the Company is no longer in
the business of marketing AT&T long distance telephone services. The Company has
been informed that KEI, after contributing additional funds to the business,
eventually discontinued business operations.
Investigation of New Business Opportunities
Since March 1992, the Company's primary activity has consisted of the
investigation and analysis of a variety of businesses with which the Company
could acquire, merge or otherwise affiliate. If the Company finds an appropriate
business opportunity it will attempt to arrange for a business combination. It
is expected that it would combine with an existing privately-held company in a
merger, consolidation, exchange of its stock for stock or assets or any other
form of combination. Because the Company is a public company, this would result
in the private company becoming part of a public corporation. Although a number
of businesses have been investigated, to date the Company has not found a
business opportunity with which it desires to combine. The expenses incurred by
the Company since January 1992 consist primarily of travel and telephone
expenses incurred by the Company's president in investigating business
opportunities and expenses incurred to comply with reporting requirements under
the Securities Exchange Act of 1934.
Although the Company has considered a number of combination candidates,
it has not decided to proceed with any of them, and the Company is not currently
negotiating with any prospective combination candidates. The Company will not
pursue any combination proposal beyond the preliminary negotiation stage with
any combination candidate which does not furnish the Company with audited
financial statements for at least its most recent fiscal year and unaudited
interim financial statements for periods subsequent to the date of the audited
financial statements. In addition, any combination candidate must be capable of
supplying audited financial statements for prior years as may be required by the
Securities Exchange Act of 1934, or any filing requirements thereunder. Under no
circumstances will there be any combination with any entity where the entity or
any of its directors, executive officers, principal shareholders or general
partners:
(a) have been convicted of securities fraud, mail fraud, tax
fraud, embezzlement, bribery or a similar criminal offense
involving misappropriation or theft of funds, or the subject
of a pending investigation or indictment involving any of
those offenses;
(b) have been subject to a temporary or permanent injunction or
restraining order arising from unlawful transactions in
securities, whether as issuer, underwriter, broker, dealer or
investment advisor, or the subject of any pending
investigation or a defendant in any pending lawsuit arising
from or based upon allegations of unlawful transactions in
securities; or
(c) have been a defendant in a civil action which resulted in a
final judgment against it or him awarding damages or
rescission based upon unlawful purchases or sales of
securities.
There will be no combination of any type with companies or individuals
affiliated with officers, directors or principal shareholders or the Company.
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<PAGE> 6
Consulting Services
In order to fund ongoing expenses of the Company during 1993, 1994 and
1995 and to enable the Company to pay liabilities, the Company has entered into
arrangements with pharmaceutical chains pursuant to which the Company has
provided consulting services. These services began in April 1993. These services
are provided on behalf of the Company by its president, who is a licensed
pharmacist. It is not intended that consulting services will be an ongoing
business of the Company. These consulting services are being rendered on a
month-to-month basis. Once the Company completes a combination with a viable
business opportunity, these services will terminate. There can be no assurance
that such services will not be terminated prior to a combination with a business
opportunity.
ITEM 2. PROPERTIES
The Company owns no real property and no significant personal property
and maintains administrative offices at 203 East Broad Street, Columbus, Ohio
43215. It currently leases approximately 150 square feet of office space at this
location and shares a conference room and common reception area. The lease is an
unwritten lease and is on a month-to-month basis with current rental payments of
$210 per month. There are no other material terms of the lease and, under Ohio
law, the lease can be terminated upon 30 days notice from either party. The
Company has no present plans to invest in real estate, real estate mortgages or
in the securities of entities engaged in these lines of business, although it
will consider all viable business opportunities.
ITEM 3. LEGAL PROCEEDINGS
There are no pending legal proceedings to which the Company or any of
its subsidiaries are a party.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of stockholders during the fourth
quarter of 1995.
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<PAGE> 7
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS
The Company's shares of common stock are traded on the over-the-counter
market. However, there has not been any significant trading activity in the
Company's stock, no established public trading market exists, and no quotations
for the Company's stock during 1994 and 1995 are available, as reflected in the
following table.
<TABLE>
<CAPTION>
Period Bid Prices
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<S> <C>
1995
First Quarter (not quoted)
Second Quarter (not quoted)
Third Quarter (not quoted)
Fourth Quarter (not quoted)
1994
First Quarter (not quoted)
Second Quarter (not quoted)
Third Quarter (not quoted)
Fourth Quarter (not quoted)
</TABLE>
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Holders of Securities
As of December 31, 1995, there were approximately 556 holders of record
of the Company's shares of common stock.
Dividend Policy
No cash dividends have been paid to date on the Company's common stock.
The Company presently intends to retain all of its earnings, if any, to finance
the growth and development of its business and does not expect to pay any cash
dividends in the foreseeable future.
ITEM 6. PLAN OF OPERATION
The Company's primary activity consists of the investigation and
analysis of a variety of businesses with which the Company could acquire, merge
or otherwise affiliate. If the Company finds an appropriate business
opportunity, it will attempt to arrange for a business combination. See Item 1.
The primary expenses in connection with this activity are travel and
telephone expenses incurred to investigate business opportunities and the salary
expense of the Company's president. During 1995, the Company also incurred
additional legal and accounting expenses to bring current and
- 4 -
<PAGE> 8
complete its reporting requirements under the Securities and Exchange Act of
1934. The Company expects to fund its cash requirements for the next 12 months
in the same manner as it has in the past several years as follows: (a) although
the president's salary accrues, the Company has not actually paid the salary to
the president and does not expect to do so until it receives funding in
connection with a business combination or otherwise; (b) the Company has
generated funds by providing consulting services to pharmaceutical chains.
$56,000 was generated from this activity in 1994 and $59,000 was generated from
this activity in 1995. This consulting is not expected to be an ongoing business
of the Company but only a means to help fund expenses and there can be no
assurance that these consulting services will continue; (c) the Company's
president has personally loaned funds to the Company. He loaned the Company
$23,545 during 1995, $36,149 during 1994, $81,057 during 1993, $44,954 during
1992 and $62,320 during 1991. Mr. Feldman, the Company's president, is not
obligated to loan any additional funds to the Company and there can be no
assurance that there will be sufficient funds to meet the Company's cash
requirements.
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Information required under this Item is contained under the heading
"Independent Auditor's Report" and is included herein as Exhibit 4 and is hereby
incorporated herein by reference.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS AND FINANCIAL
DISCLOSURE
There are no disclosures required under this Item.
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<PAGE> 9
PART III
ITEM 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
<TABLE>
<CAPTION>
Name Age Position and Business Experience Director Since
---- --- -------------------------------- --------------
<S> <C> <C> <C>
Robert M. Feldman 64 Chairman of the Board of Directors, President, 1986
and Chief Executive Officer of the Company.
Since 1984, Mr. Feldman has been involved
with the organization, development, and oper-
ating of the Company and its subsidiaries. Mr.
Feldman is a licensed pharmacist in the State of
Ohio.
Burton Schildhouse 70 Secretary, Treasurer and director of the 1986
Company. From June 1990 to June 1995
Mr. Schildhouse served as Vice President of the
Greater Columbus Chamber of Commerce. For more
than 25 years, Mr. Schildhouse has been Chief
Executive Officer of Burton Schildhouse
Communications Counsel, Columbus, Ohio, a firm
which provides consulting services to businesses,
institutions, and public agencies on business and
development issues, public affairs, communications,
public relations, and advertising. He has served as
its Chairman from July 1995 to present.
Arthur Aaronson 47 Director of the Company. Since 1975, Mr. 1989
Aaronson has been a partner in the law firm of
Aaronson & Aaronson, Los Angeles, California.
James S. Koroloff 62 Director of the Company. From May 1990 to 1990
December 1991, he served as a vice president
of the Company. Since June 1989, Mr.
Koroloff has also been president of Westchester
Capitol Corporation, Toledo, Ohio, a firm which
is engaged in raising venture capital for
businesses. From July 1988 to June 1989,
Mr. Koroloff was vice president of syndications
for United Satellite Associations, Detroit,
Michigan. From January 1985 to July 1988,
Mr. Koroloff was a consultant and later a vice
president of syndication for First Ameri-Cable
Corporation, Columbus, Ohio, a company engaged
in providing cable television services.
Mr. Koroloff's duties with both United Satellite
Associates and First Ameri-Cable Corporation
involved raising capital for the operations of the
companies.
</TABLE>
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<PAGE> 10
<TABLE>
<S> <C> <C>
Donald S. Franklin 66 Director of the Company. From 1991 until 1990
retirement in 1994, Mr. Franklin was the sales
manager for Anderson Glass Company, Colum-
bus, Ohio, a firm engaged in the retial sale of
glass and mirror products. From December
1988 to October 1990, Mr. Franklin was the
operation and sales manager for Safelite
Corporation, Columbus, Ohio, a firm engaged in
the retail sale of automotive and industrial glass.
From 1968 to 1988, Mr. Franklin was
employed by Norman's Auto Glass, Columbus,
Ohio, of which his last position was that of
general manager.
</TABLE>
During 1995, the directors took action by unanimous written consent
without a meeting one time.
Messrs. Feldman and Schildhouse, both directors of the Company, are
members of the Board's Stock Option Committee under the Company's 1986 Incentive
Stock Option Plan, which committee Administers such Plan. The Stock Option
Committee did not meet during 1995. No options are presently outstanding under
such Stock Option Plan. The Board has no standing audit, nominating, or
compensation committees, or committees performing similar functions.
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires the Company's officers, directors and persons who own more than 10% of
a registered class of the Company's equity securities to file statements of
beneficial ownership of the Company's shares of common stock. Based solely on a
review of copies of the forms filed under Section 16(a), if any, and furnished
to the Company, the Company is not aware of any noncompliance with this
requirement by any of its officers, directors or principal shareholders.
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<PAGE> 11
ITEM 10. EXECUTIVE COMPENSATION
Set forth below is the compensation of the Company's Chief Executive
Officer for the years indicated, the only person receiving compensation.
<TABLE>
<CAPTION>
All
Other Securities Other
Name Annual Restricted Underly- LTIP Comp-
and Compen- Stock ing Pay- ensa-
Principal Salary Bonus sation Award(s) Options/ outs tion
Position Year (1) ($) ($)(1) ($) SARs (#) ($) ($)
-------- ---- ------ ------- ------ ------- -------- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Robert M.
Feldman,
President 1995 $24,000 $0 $0 $0 $0 $0 $0
1994 $24,000 $0 $0 $0 $0 $0 $0
1993 $42,000 $0 $0 $0 $0 $0 $0
</TABLE>
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(1) Salaries have been accrued pursuant to an employment agreement with H&L
Concepts, Inc., a wholly owned subsidiary of the Company. Under the
agreement, Mr. Feldman was entitled to receive an annual salary of
$60,000 for each of the years 1990, 1991, and 1992, a salary of $42,000
in 1993 and a salary of $24,000 in 1994 and 1995. However, because of
the Company's cash position, Mr. Feldman did not receive any of his
salary during these years. Such salary is reflected as an accrued
liability on the Company's financial statements. The employment
agreement also provides for the use of an automobile and certain other
benefits as the Board may from time to time determine.
Compensation of Directors
No Director of the Company has received any compensation as such, to
date, and there are no plans to compensate Directors.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
The following table sets forth certain information with respect to the
only persons known to the Company to own beneficially more than five percent of
the outstanding shares of Common Stock as of December 31, 1995:
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<PAGE> 12
<TABLE>
<CAPTION>
Amount Beneficially Percent of
Name and Address Owned (1) Class
- ---------------- ------------------- ----------
<S> <C> <C>
Robert M. Feldman 9,400,000 (2) 54.3%
2720 Sonata Drive
Columbus, OH 43209
Arthur Aaronson 1,250,000 (3) 7.2%
16133 Ventura Blvd.
Encino, CA 91436
Keith Marz 2,506,840 (3) 14.47%
14310 Weddington Street
Sherman Oaks, CA 91401
</TABLE>
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(1) Except as noted, all shares are beneficially owned and the sole voting
and investment power is held by the persons named.
(2) Does not include shares of Common Stock owned by Mr. Feldman's adult
children. Mr. Feldman disclaims any beneficial ownership of such
shares of Common Stock.
(3) Mr. Aaronson and Mr. Marz jointly own 1,000,000 shares of Common Stock
in which they share voting and investment power.
Security Ownership of Management
The following table sets forth certain information with respect to the
number of shares of Common Stock beneficially owned by each director of the
Company, and by all directors and officers of the Company as a group, as of
December 31, 1995:
<TABLE>
<CAPTION>
Amount Beneficially Percent of
Name Owned (1) Class
---- ------------------- ----------
<S> <C> <C>
Robert M. Feldman 9,400,000 (2) 54.3%
Burton Schildhouse 35,000 .2%
Arthur Aaronson 1,250,000 (3) 7.2%
James S. Koroloff 500,000 2.9%
Donald S. Franklin 50,000 (4) .3%
All directors and officers 11,235,000 64.85%
as a group (5 persons)
</TABLE>
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<PAGE> 13
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(1) Except as noted, all shares are beneficially owned and the sole voting
and investment power is held by the persons named.
(2) Does not include shares of Common Stock owned by Mr. Feldman's adult
children. Mr. Feldman disclaims any beneficial ownership of such
shares of Common Stock.
(3) 1,000,000 of the shares owned by Mr. Aaronson are owned jointly with
Mr. Keith Marz.
(4) The shares owned by Mr. Franklin are owned jointly with his spouse.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As of the end of 1995, the Company owed Robert M. Feldman $207,888,
exclusive of accrued and unpaid salary and exclusive of interest. Such amount
consisted of (a) monies owed by the Company to Mr. Feldman under a promissory
note dated April 12, 1991, (b) advances by Mr. Feldman to the Company during
1991, 1992, 1993, 1994 and 1995, and (c) accrued interest under such 1991
promissory note and for such advances through 1994. The aggregate amount owed
through 1994 was consolidated into a promissory note from the Company to Mr.
Feldman dated January 18, 1995 in the principal amount of $184,343, with
principal and accrued interest payable over a five year period in equal monthly
installments of principal and interest beginning in February 1996. In February
1996, the date for the commencement of monthly payments was extended to
February 1, 1997. Additionally, the Company executed a similar note in February
1996, for amounts advanced during 1995 in the principal amount of $23,545. In
the event of a change in control of the Company, all principal and accrued
interest under the notes is, at Mr. Feldman's option, immediately due and
payable. Generally, a change of control is defined in the notes to mean (i)
when a person or group acquires 20 percent or more of the Company's outstanding
shares; (ii) when, during any period of 24 consecutive months, the individuals
who, at the beginning of such period, constitute the board of directors cease
for any reason other than death to constitute a majority of the board; or (iii)
upon the acquisition of the Company by an outside entity through a transaction
requiring shareholder approval.
In 1995, $14,149 was due to a bank from a loan the Company obtained in
1988 in the amount of $100,000. The bank's lending rate was prime plus 2%,
payable in equal monthly installments of principal plus interest of $1,000
through April 1994. In 1993, the payments on the note were changed to $1,000 per
month including interest. In 1994, the loan was renewed in the amount of
$28,000. The loan is personally guaranteed by Mr. Feldman. The proceeds from the
loan were originally used for the purchase of inventory. In 1994, these monies
were used for operational expenses.
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<PAGE> 14
PART IV
ITEM 13. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K
(a)(1) LISTING OF FINANCIAL STATEMENTS
The following financial statements of the Company are incorporated
by reference in Item 8:
Independent Auditors' Report.
Consolidated Balance Sheets at December 31, 1995 and 1994.
Consolidated Statement of Operations for the Years Ended
December 31, 1995 and 1994, and for the period March 13, 1985
(Inception) through December 31, 1995.
Consolidated Statements of Shareholders' Equity Deficiency for
the period March 13, 1985 (Inception) through December 31,
1995.
Consolidated Statements of Cash Flows for the years ended
December 31, 1995 and 1994, and for the period March 13, 1985
(Inception) through December 31, 1995.
Notes to Consolidated Financial Statements for the years ended
December 31, 1995 and 1994.
(a)(2) LISTING OF FINANCIAL STATEMENT SCHEDULES
Schedules IV, VIII and IX are included following the signature page.
All other Schedules are omitted because the required information is
either represented in the financial statements or notes thereto, or
is not applicable, required or material.
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<PAGE> 15
(a)(3) LISTING OF EXHIBITS
<TABLE>
<CAPTION>
If Incorporated by Reference,
Exhibit Document with which Exhibit was
No. Description of Exhibit Previously Filed with SEC
- ------- ---------------------- -------------------------
<S> <C> <C>
1(A) Certificate of Incorporation Annual report on Form 10-K for the year ended
December 31, 1987, filed March 30, 1988 (see
Exhibit 1(A) therein).
1(B) Certificate of Amendment to Annual report on Form 10-K for the year ended
Certificate of Incorporation filed December 31, 1988, filed December 28, 1989 (see
May 2, 1988 Exhibit 1(B) therein).
1(C) Certificate of Amendment to Annual report on Form 10-K for the year ended
Certificate of Incorporation filed December 31, 1990, filed April 15, 1991 (see
September 12, 1990 Exhibit 1(C) therein).
1(D) Bylaws Post-Effective Amendment No. 3 to the 1933 Act
Registration Statement on Form S-18 filed April 27,
1987 (see Exhibit 3(B) therein).
2 Specimen Stock Certificate Post-Effective Amendment No. 3 to the 1933 Act
Registration Statement on Form S-18 filed
November 12, 1986 (see Exhibit 10(A) therein).
*3(A) Employment Agreement with Post-Effective Amendment No. 1 to the 1933 Act
Robert M. Feldman Registration Statement on From S-18 filed
November 12, 1986 (see Exhibit 10(A) therein).
*3(B) Health & Leisure, Inc. 1986 Annual Report on Form 10-K for the year ended
Incentive Stock Option Plan December 31, 1988, filed December 28, 1989 (see
Exhibit 3(E) therein).
3(C) Promissory Note dated Form 10-K for year ending December 31, 1994, filed
January 18, 1995 from H & L April 14, 1995.
Concepts, Inc. to Robert M.
Feldman
3(D) Amendment dated February 1, Contained herein.
1996 to Promissory Note dated
January 18, 1995 from H & L
Concepts, Inc. to Robert M.
Feldman
</TABLE>
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<PAGE> 16
<TABLE>
<CAPTION>
If Incorporated by Reference,
Exhibit Document with which Exhibit was
No. Description of Exhibit Previously Filed with SEC
- ------- ---------------------- -------------------------
<S> <C> <C>
3(E) Promissory Note dated Contained herein.
February 1, 1996 from H & L
Concepts, Inc. to Robert M.
Feldman
4 Independent Auditor's Report Contained herein.
5 List of Subsidiaries Contained herein.
6 Powers of Attorney Contained herein.
7 Financial Data Schedule Contained herein.
</TABLE>
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*Executive Compensation Plans and Arrangements required to be filed pursuant to
Reg. 601(B)(10) of Regulation S-B.
No other exhibits are required to be filed herewith pursuant to Item
601 of Regulation S-B.
(b) REPORTS ON FORM 8-K
No Form 8-K's were filed during the fourth quarter of the
Company's fiscal year ended December 31, 1995.
(c) EXHIBITS
The exhibits in response to this portion of Item 13 are
submitted as a separate section of this report following the
signatures.
(d) FINANCIAL STATEMENT SCHEDULES
Schedules IV, VIII, and IX are included following the
signature page. All other schedules are omitted because the
required information is either presented in the financial
statements or notes thereto or is not applicable, required or
material.
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<PAGE> 17
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
HEALTH & LEISURE, INC.
Date: April 16, 1996 By /s/Robert M. Feldman
------------------------------------
Robert M. Feldman, President,
Chief Executive Officer and Chairman
of the Board of Directors
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Robert M. Feldman President, Chief Executive April 16, 1996
- ---------------------- Officer, and Chairman
Robert M. Feldman (Principal Executive Officer)
Burton Schildhouse* Secretary, Treasurer and April 16, 1996
- ---------------------- Director (Principal Financial
Burton Schildhouse Officer)
Arthur Aaronson* Director April 16, 1996
- ----------------------
Arthur Aaronson
Donald S. Franklin* Director April 16, 1996
- ----------------------
Donald Franklin
James S. Koroloff* Director April 16, 1996
- ----------------------
James Koroloff
</TABLE>
*The undersigned, by signing his name hereto, does sign this document
on behalf of the person indicated above pursuant to a Power of Attorney duly
executed by such person.
By /s/ Robert M. Feldman April 16, 1996
---------------------------
Robert M. Feldman,
Attorney-in-Fact
- 14 -
<PAGE> 18
HEALTH & LEISURE, INC. AND SUBSIDIARIES
(A Development Stage Company)
Schedule IV - Indebtedness of and to Related Parties - Not Current
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Indebtedness to
Balance at related parties - not current Balance at
1995 beginning ----------------------------- end of
Name of Person of period Additions Deductions period
-------------- --------- --------- ---------- ----------
Robert M. Feldman $184,343 $21,272 0 $205,615
President ======== ======= ======= ========
1994
Name of Person
--------------
Robert M. Feldman, $154,024 $62,319 (1) $32,000 (2) $184,343
President ======== ======= ======= ========
</TABLE>
- -------------------------
(1) 1995 and 1994, additions consist of borrowings of $21,272 and $62,319,
respectively.
(2) 1995 and 1994 deductions consist of principal payments of $0 and
$32,000, respectively.
- 15 -
<PAGE> 19
HEALTH & LEISURE, INC. AND SUBSIDIARIES
(A Development Stage Company)
Schedule VIII - Valuation and Qualifying Accounts
<TABLE>
<CAPTION>
Additions
Additions Charged to
Balance at Charged to other Balance at
beginning costs and accounts end of
of period expenses describe period
--------- -------- -------- ------
<S> <C> <C> <C> <C>
1995
Description:
Allowance for doubtful
accounts $0 $0
== ==
1994
Allowance for doubtful
accounts $0 $0
== ==
</TABLE>
- 16 -
<PAGE> 20
HEALTH & LEISURE, INC. AND SUBSIDIARIES
(A Development Stage Company)
Schedule IX - Short Term Borrowings
<TABLE>
<CAPTION>
Maximum Average Weighted
Weighted Amount Amount Average
1995 Balance Average Outstanding Outstanding Interest Rate
Category of Aggregate At End of Interest During the During the During the
Short Term Borrowings Period Rate Period Period (1) Period (2)
- --------------------- ------ ---- ------ ---------- ----------
<S> <C> <C> <C> <C> <C>
Notes payable to:
Financial Institution $14,149 10.85% $20,000 $14,158 13.42%
1994
Category of Aggregate
Short Term Borrowings
Notes payable to:
Financial Institution $17,770 9.19% $26,000 $18,387 8.28%
</TABLE>
(1) The average amount outstanding during the period was computed by
dividing the total period-end outstanding principal balances by 12.
(2) The weighted average interest rate during the period was computed by
dividing the actual interest expense by average period-end short term
borrowings.
(3) In March 1994, the Company renewed the note with an additional
$26,000 loan and in April 1995 with an additional $4,772.
- 17 -
<PAGE> 21
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. If Incorporated by Reference,
Under Reg. S-B Form 10-K Document with which Exhibit
Item 601 Exhibit No. Description of Exhibit was Previously Filed
-------- ----------- ---------------------- --------------------
<S> <C> <C> <C>
(3) 1(A) Certificate of Incorporation Form 10-K Annual Report for the
year ended December 31, 1987,
filed March 30, 1988 (see Exhibit
1(A) therein).
(3) 1(B) Certificate of Amendment to Form 10-K Annual Report for the
Certificate of Incorporation year ended December 31, 1988,
filed May 2, 1988 filed December 28, 1989 (see
Exhibit 1(B) therein).
(3) 1(C) Certificate of Amendment to Form 10-K Annual Report for the
Certificate of Incorporation year ended December 31, 1990,
filed September 12, 1990 filed April 15, 1991 (see Exhibit
1(C) therein).
(3) 1(D) Bylaws Post-Effective Amendment No. 3
to the 1933 Act Registration
Statement on Form S-18 filed
April 27, 1987 (see Exhibit 3(B)
therein).
(4) 2 Specimen Stock Certificate Post-Effective Amendment No. 3
to the 1933 Act Registration
Statement on Form S-18 filed
November 12, 1986 (see Exhibit
10(A) therein).
(10) 3(A) Employment Agreement Post-Effective Amendment No. 1
with Robert M. Feldman to the 1933 Act Registration
Statement on From S-18 filed
November 12, 1986 (see Exhibit
10(A) therein).
(10) 3(B) Health & Leisure, Inc. 1986 Annual Report on Form 10-K for
Incentive Stock Option Plan the year ended December 31,
1988, filed December 28, 1989
(see Exhibit 3(E) therein).
</TABLE>
- 18 -
<PAGE> 22
<TABLE>
<CAPTION>
Exhibit No. If Incorporated by Reference,
Under Reg. S-B Form 10-K Document with which Exhibit
Item 601 Exhibit No. Description of Exhibit was Previously Filed
-------- ----------- ---------------------- --------------------
<S> <C> <C> <C>
(10) 3(C) Promissory Note dated Form 10-K for year ending
January 18, 1995 from December 31, 1994, filed
H & L Concepts, Inc. to April 14, 1995.
Robert M. Feldman
(10) 3(D) Amendment dated Febru- Contained herein.
ary 1, 1996 to Promissory
Note dated January 18,
1995 from H & L Concepts,
Inc. to Robert M. Feldman
(10) 3(E) Promissory Note dated Contained herein.
February 1, 1996 from
H & L Concepts, Inc. to
Robert M. Feldman
(23) 4 Independent Auditor's Contained herein.
Report
(21) 5 List of Subsidiaries Contained herein.
(24) 6 Powers of Attorney Contained herein.
(27) 27 Financial Data Schedule Contained herein.
</TABLE>
- 19 -
<PAGE> 1
EXHIBIT 3(D)
AMENDMENT DATED FEBRUARY 1, 1996 TO PROMISSORY NOTE
DATED JANUARY 18, 1995 FROM
H & L CONCEPTS, INC.
TO
ROBERT M. FELDMAN
- 28 -
<PAGE> 2
AMENDMENT OF PROMISSORY NOTE
The undersigned hereby agree to modify the promissory note dated
February 1, 1995 from Health & Leisure, Inc. to Robert M. Feldman, a copy of
which is attached hereto, to extend the date for the commencement of payment of
principal and interest to February 1, 1997, with interest accrued through
December 31, 1996 being added to principal.
All other terms of the note shall remain in full force and effect as
written.
February 1, 1996 /s/Robert M. Feldman
---------------------------------
ROBERT M. FELDMAN
H & L CONCEPTS, INC., Maker
By /s/Burton Schildhouse
-------------------------------
HEALTH & LEISURE, INC., Guarantor
By /s/Burton Schildhouse
-------------------------------
- 29 -
<PAGE> 1
EXHIBIT 3(E)
PROMISSORY NOTE DATED FEBRUARY 1, 1996
FROM
H & L CONCEPTS, INC.
TO
ROBERT M. FELDMAN
- 30 -
<PAGE> 2
COGNOVIT PROMISSORY NOTE
$23,545 February 1, 1996
FOR VALUE RECEIVED, H & L Concepts, Inc., an Ohio corporation, whose
address is 203 East Broad Street, Columbus, Ohio 43215 ("Maker"), promises to
pay to the order of Robert M. Feldman, an individual, whose address is 2720
Sonata Drive, Columbus, Ohio 43209 ("Payee"), the principal sum of Twenty-Three
Thousand Five Hundred Forty-Five Dollars ($23,545) with interest thereon at the
rate of 5.61% per annum. The principal sum, plus accrued interest, is due
and payable in 60 equal monthly installments of principal and interest beginning
February 1, 1997, with interest accrued through December 31, 1996 being added to
principal. The first payment shall be due and payable February 1, 1997 and
payments shall continue on the first day of each month thereafter until all
principal and accrued interest is paid in full. All or any portion of the
principal and accrued interest may be prepaid at any time without penalty. All
prepayments shall be applied first to accrued interest and then to principal in
inverse order of maturity. Notwithstanding the foregoing to the contrary, in the
event of a change in control of Health & Leisure, Inc., a Delaware corporation,
or in the event of a change in control of the Maker, at the option of the
holder of this note, all principal and accrued interest under this note shall
become and be immediately due and payable. for purposes of this note, a change
in control is defined to mean:
(i) When any "person" as defined in Section 3(a)(9) of the
Securities Exchange Act of 1934 (the "Exchange Act") and as used in
Sections 13(d) and 14(d) thereof, including a "group" as defined in
Section 13(d) of the Exchange Act, but excluding the Company and any
subsidiary and any employee benefit plan sponsored or maintained by
the Company or any subsidiary (including any trustee of such plan
acting as trustee), directly or indirectly, becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act, as amended
from time to time) of securities of the Company representing 20% or
more of the combined voting power of the Company's then outstanding
securities; or
(ii) When, during any period of 24 consecutive months, the
individuals who, at the beginning of such period, constitute the Board
of Directors (the "Incumbent Directors") cease for any reason other
than death to constitute at least a majority thereof; provided,
however, that a director who was not a director at the beginning of
such 24-month period shall be deemed to have satisfied such 24-month
requirement (and be an Incumbent Director) if such director was elected
by, or on the recommendation of or with the approval of, at least
two-thirds of the directors who then qualified as Incumbent Directors
either actually (because they were directors at the beginning of such
24-month period) or by prior operation of this subparagraph (ii); or
(iii) Upon the occurrence of a transaction requiring
stockholder approval for the acquisition of the Company by an entity
other than the Company or a subsidiary through purchase of assets,
purchase of stock, by merger or otherwise.
All payments under this Note shall be payable at Payee's address
indicated above or at such other address as any holder of this Note may from
time to time designate in writing to Maker.
Upon default in payment of any installment within 10 days after the
same is due, this Note shall, at the option of the holder hereof, bear interest
thereafter at the rate of 12% per annum, and the
- 31 -
<PAGE> 3
entire principal hereof then remaining unpaid, together with all accrued
interest, shall at said holder's option, become immediately due and payable
without any notice or demand.
All persons now or hereafter liable for the payment of the principal or
interest due on this Note, or any part thereof, do hereby expressly waive
presentment for payment, notice of dishonor, protest and notice of protest and
agree that the time for the payment of this Note may be extended without
releasing or otherwise affecting their liability on this Note.
Each right, power or privilege specified or referred to in this Note or
in any related writing is in addition to any other rights, powers and privileges
that Payee may otherwise have or require by operation of law, by other contract
or otherwise. No course of dealing in respect of, nor any omission or delay in
the exercise of, any right, power, or privilege by Payee or the holder hereof
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any further or other exercise thereof or of any other, as each
right, power or privilege may be exercised independently or concurrently with
others and as often and in such order as the holder may deem expedient. No
waiver or consent granted by the holder in respect of this Note or any related
writing shall be binding upon the holder unless specifically granted in writing,
which writing shall be strictly construed. Each right, power or privilege
granted to the holder in this Note or in any related writing is for the benefit
of and exercisable by each subsequent holder, if any, of this Note, and all
provisions of this Note shall be binding upon Maker, its successors and assigns,
including each subsequent holder, if any, of this Note.
Maker hereof and the undersigned guarantor, each irrevocably authorizes
any attorney at law to appear for it in any court in Franklin County, Ohio, with
or without process, at any time after the above indebtedness becomes due, to
waive the issuance and service of process, to admit the maturity and nonpayment
of the indebtedness and to confess judgment against Maker and/or such guarantor
in favor of the holder of this Note for the amount then appearing due, together
with costs of suit, and thereupon to release all errors and waive all right of
second trial, appeal, and stay of execution. The foregoing warrant of attorney
shall survive any judgment. Should any judgment be vacated for any reason, the
foregoing warrant of attorney may thereafter be utilized for obtaining
additional judgment or judgments.
Maker has executed and delivered this Note in the City of Columbus,
Franklin County, Ohio, as of February 1, 1996.
H & L CONCEPTS, INC.
By /s/Burton Schildhouse
--------------------------------
Burton Schildhouse, Secretary
WARNING -- BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT
TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM
- 32 -
<PAGE> 4
YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR
RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT,
OR ANY OTHER CAUSE (SECTION 2323.13, O.R.C.).
Payment guaranteed by:
HEALTH & LEISURE, INC.
Dated as of February 1, 1996
By /s/Burton Schildhouse
-----------------------------------
Burton Schildhouse, Secretary
WARNING -- BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT
TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR
RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT,
OR ANY OTHER CAUSE (SECTION 2323.13, O.R.C.).
- 33 -
<PAGE> 1
EXHIBIT 5
LIST OF SUBSIDIARIES
OF
HEALTH & LEISURE, INC.
H & L Concepts, Inc., an Ohio corporation
Amtele, Inc., a Delaware corporation
Venture Sum, Inc. a Delaware corporation
- 35 -
<PAGE> 1
EXHIBIT 4
INDEPENDENT AUDITOR'S REPORT
OF
HEALTH & LEISURE, INC. AND SUBSIDIARIES
FOR THE YEARS ENDED
DECEMBER 31, 1995 AND 1994
- 34 -
<PAGE> 2
HARMON & COMPANY CPA, Inc.
COLUMBUS, OHIO
HEALTH & LEISURE, INC. AND SUBSIDIARIES
Audited Financial Statements
and
Independent Auditors' Report
December 31, 1995 and 1994
<PAGE> 3
HARMON & COMPANY, CPA Inc.
[ LOGO ] 2000 HENDERSON ROAD
SUITE 140
COLUMBUS, OHIO 43220
Independent Auditor's Report
----------------------------
To The Board of Directors of
Health & Leisure, Inc. and Subsidiaries
We have audited the accompanying Balance Sheets of Health & Leisure,
Inc. and Subsidiades as of December 31, 1995 and 1994 and the related
statements of operations, cash flow, and stockholders' equity for the years
then ended. These financial statements are the responsibility of the management
of Health & Leisure, Inc. Our responsibility is to express an opinion on these
financial statements based on our audit.
We have conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the statements are free of
material misstatements. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the 1995 and 1994 financial statements referred to
above present fairly, in all material respects, the financial position of
Health & Leisure, Inc. and Subsidiaries as of December 31, 1995 and 1994 and
the results of its operations and its cash flows for the years then ended in
conformity with generally accepted accounting principles.
The accompanying consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. As discussed in
Note A, the Company has experienced significant recurring losses and has a net
stockholders' deficit that raise substantial doubt about its ability to
continue as a going concern. Substantially all of the outstanding debt, and
the revenue and expense activity of the business are related party
transactions. The consolidated financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
Harmon & Company, CPA, Inc.
- ---------------------------
Harmon & Company, CPA, Inc.
April 11, 1996
Phone 614 - 326 - 3822
Fax 614 - 326 - 3824
<PAGE> 4
Health & Leisure, Inc. and Subsidiaries
(A Development Stage Company)
Consolidated Balance Sheets
December 31, 1994 and 1995
<TABLE>
<CAPTION>
12/31/95 12/31/94
-------- --------
Assets
------
<S> <C> <C>
Current Assets
- --------------
Cash $ 3,178 $ 0
----------- -----------
Total Current Assets $ 3,178 $ 0
----------- -----------
Property & Equipment
- --------------------
Furniture & Fixtures $ 1,893 $ 1,893
Less Accumulated Depreciation (1,893) (1,893)
----------- -----------
Total Property & Equipment $ 0 $ 0
----------- -----------
Total Assets $ 3,178 $ 0
----------- -----------
Liabilities and Shareholders' Equity
------------------------------------
Current Liabilities
- -------------------
Accounts Payable $ 22,733 $ 14,245
Accrued Interest - Officer 44,135 33,040
Accrued Officer Wages 270,000 246,000
Current portion of long term debt 12,000 12,000
----------- -----------
Total Current Liabilities $ 348,868 $ 305,285
----------- -----------
Long Term Debt
- --------------
Note Payable less current portion
Officer $ 205,615 $ 184,343
Bank 2,149 5,770
----------- -----------
Total Long Term Liabilities $ 207,764 $ 190,113
----------- -----------
Shareholders' Equity
- --------------------
Preferred Stock, $.01 par value: Authorized - 10,000,000 shares
Issued and outstanding - none 1994 and 1995
Common Stock, $.01 par value: Authorized - 20,000,000 shares Issued and
outstanding - 17,325,427 shares 1994 and 1995 $ 173,254 $ 173,254
Additional Paid-in-Capital 1,213,236 1,213,236
Donated Capital 0 0
Deficit Accumulated During the Development Stage (1,939,944) (1,881,888)
----------- -----------
Total Shareholders' Equity $ (553,454) $ (495,398)
----------- -----------
Total Liabilities and Shareholders' Equity $ 3,178 $ 0
----------- -----------
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE> 5
Health & Leisure, Inc. and Subsidiaries
(A Development Stage Company)
Consolidated Statements of Operations
For the years ended December 31, 1995, 1994 and the
Period from March 13, 1985 (Date of Inception) through December 31, 1995
<TABLE>
<CAPTION>
Cumulative
During
Development
Stage 12/31/95 12/31/94
----- -------- --------
<S> <C> <C> <C>
Income:
- -------
Product Sales $ 297,667 $ 0 $ 0
Consulting Revenue 306,608 59,000 35,000
------------ ------------ -----------
Total Income $ 604,275 $ 59,000 $ 35,000
Cost of Goods Sold 402,961 0 0
------------ ------------ -----------
Gross Profit $ 201,314 $ 59,000 $ 35,000
------------ ------------ -----------
OPERATING EXPENSES:
- -------------------
Officer Salaries $ 476,750 $ 24,000 $ 24,000
General & Administrative Expenses 784,713 30,694 27,921
Legal & Professional 514,883 28,858 12,362
Travel 313,902 20,741 18,366
Depreciation & Amortization 48,216 0 0
Bad Debts 38,500 0 0
------------ ------------ -----------
Total Expenses $ 2,176,964 $ 104,293 $ 82,649
------------ ------------ -----------
Income (Loss) from Operations $ (1,975,650) $ (45,293) $ (47,649)
------------ ------------ -----------
Other Income (Expense):
-----------------------
Interest Income $ 18,111 0 0
Interest Expense (117,004) (12,828) (14,313)
Gain on Sale of Marketable Securities 19,590 0 0
Other Income (Expense) (1,949) 65 152
------------ ------------ -----------
Total Other Income (Expense) $ (81,252) $ (12,763) $ (14,161)
------------ ------------ -----------
Loss before Extraordinary Item $ (2,056,902) $ (58,056) $ (61,810)
------------ ------------ -----------
Extraordinary Item - Gain on Extinguishment
of Debt 167,288 0 0
------------ ------------ -----------
Net Income (Loss) $ (1,889,614) $ (58,056) $ (61,810)
------------ ------------ -----------
Loss per Common Share:
Loss before Extraordinary Item (0.15) (0.00) (0.00)
Extraordinary Item 0.01 nil nil
------------ ------------ -----------
Net Loss per Common Share (0.14) (0.00) (0.00)
Weighted Average Shares Outstanding
during the period 13,915,779 17,325,427 17,325,427
------------ ------------ -----------
</TABLE>
Note - The development stage represents the period March 13, 1985 through
December 31, 1995.
The accompanying notes are an
integral part of these financial statements
<PAGE> 6
Health & Leisure, Inc. and Subsidiaries
(A Development Stage Enterprise)
Statement of Changes in Stockholders' Equity
For the Period from March 13, 1985 (Date of Inception) through
December 31, 1995
<TABLE>
<CAPTION>
Deficit
Cumulative
Common Stock Additional During Total
------------ Paid-In Development Stockholders'
Shares Amount Capital Stage Equity
------ ------ ------- ----- ------
<S> <C> <C> <C> <C> <C>
Proceeds from initial issuance of Common Stock
on March 13, 1985 300,000 $ 3,000 $ 3,000 $ 6,000
Retroactive effect of recapitalization 7,700,000 77,000 (3,000) (27,049) 46,951
Balances at March 13, 1985 (the date of inception) ------------------------------------------------------------
as restated 8,000,000 80,000 0 (27,049) 52,951
Net Loss for the period (96,722) (96,722)
------------------------------------------------------------
Balance - December 31, 1985 8,000,000 80,000 0 (123,771) (43,771)
------------------------------------------------------------
Common shares issued, net of related costs of $25 1,000,000 10,000 64,390 74,390
Proceeds from exercise of Series A Warrants 625,427 6,254 614,661 620,915
Net loss for the year (230,969) (230,969)
------------------------------------------------------------
Balance - December 31, 1986 9,625,427 96,254 679,051 (354,740) 420,565
------------------------------------------------------------
Proceeds from exercise of options 140,000 1,400 (550) 850
Proceeds from exercise of Series A Warrants 1,000 100 9,900 10,000
Common shares issued pursuant to finders fee agreement 200,000 2,000 2,000
Costs incurred in obtaining working capital (25,580) (25,580)
Net loss for the year (374,614) (374,614)
------------------------------------------------------------
Balance - December 31, 1987 9,975,427 99,754 662,821 (729,354) 33,221
------------------------------------------------------------
Dividend - 498,771 shares of Entrepreneur, Inc. (14,689) (14,689)
Net loss for the year (242,711) (242,711)
------------------------------------------------------------
Balance - December 31, 1988 9,975,427 99,754 662,821 (986,754) (224,179)
------------------------------------------------------------
Debt conversion 2,000,000 20,000 100,000 120,000
Common shares issued 1,500,000 15,000 95,000 110,000
Contribution of capital 106,415 106,415
Net loss for the year (156,153) (156,153)
------------------------------------------------------------
Balance - December 31, 1989 13,475,427 134,754 964,236 (1,142,907) (43,917)
------------------------------------------------------------
</TABLE>
<PAGE> 7
Health & Leisure, Inc. and Subsidiaries
(A Development Stage Enterprise)
Statement of Changes in Stockholders' Equity (continued)
For the Period from March 13, 1985 (Date of Inception) through
December 31, 1995
<TABLE>
<CAPTION>
Deficit
Cumulative
Common Stock Additional During Total
------------ Paid-In Development Stockholders'
Shares Amount Capital Stage Equity
------ ------ ---------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Balance - December 31, 1989 13,475,427 $ 134,754 $ 964,236 $(1,142,907) $ (43,917)
Common shares issued 3,850,000 38,500 241,500 280,000
Net loss for the year (490,642) (490,642)
---------------------------------------------------------------
Balance - December 31, 1990 17,325,427 173,254 1,205,736 (1,633,549) (254,559)
---------------------------------------------------------------
Net loss for the year (22,323) (22,323)
---------------------------------------------------------------
Balance - December 31, 1991 17,325,427 173,254 1,205,736 (1,655,872) (276,882)
---------------------------------------------------------------
Net loss for the year (78,322) (78,322)
---------------------------------------------------------------
Balance - December 31, 1992 17,325,427 173,254 1,205,736 (1,734,194) (355,204)
---------------------------------------------------------------
Donated capital 7,500 7,500
Net loss for the year (85,884) (85,884)
---------------------------------------------------------------
Balance - December 31, 1993 17,325,427 173,254 1,213,236 (1,820,078) (433,588)
---------------------------------------------------------------
Net loss for the year (61,810) (61,810)
---------------------------------------------------------------
Balance - December 31, 1994 17,325,427 173,254 1,213,236 (1,881,888) (495,398)
---------------------------------------------------------------
Net loss for the year (58,056) (58,056)
---------------------------------------------------------------
Balance - December 31, 1995 17,325,427 173,254 1,213,236 (1,939,944) (553,454)
---------------------------------------------------------------
</TABLE>
The accompanying notes are an
integral part of these financial statements
<PAGE> 8
Health & Leisure, Inc. and Subsidiaries
(A Development Stage Company)
Consolidated Statements of Cash Flows
For the years ended December 31, 1995, 1994 and the
Period from March 13, 1985 (Date of Inception) through December 31, 1995
<TABLE>
<CAPTION>
Cumulative
During
Development
Stage 12/31/95 12/31/94
----- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
- -------------------------------------
Net Income (Loss) $(1,889,614) $(58,056) $(61,810)
Adjustments to reconcile net loss to net cash
---------------------------------------------
provided (used) by operating activities:
----------------------------------------
Provision for losses on accounts receivable 31,000 0 0
Depreciation & Amortization 48,216 0 0
Deferred charge writeoff 5,876 0 0
Other non cash items (4,520) 0 0
Common Stock issued for finders fee 2,000 0 0
Extraordinary item - extinguishment of debt (167,288) 0 0
Gain on sale of marketable securities (19,590) 0 0
Payroll and interest expense recorded as 0 0
note payable to officer 163,275 0 0
Common Stock issued for consulting services 195,000 0 0
Changes in operating assets and liabilities:
--------------------------------------------
Decrease (Increase) in Accounts Receivable (31,000) 0 0
Decrease (Increase) in Inventories 0 0 0
Deferred underwriting costs (5,876) 0 0
Decrease (Increase) in Prepaid Expenses (8,592) 0 0
Decrease (Increase) in Organizational Costs (46,012) 0 0
Increase (Decrease) in Accounts Payable 107,649 8,488 (9,160)
Increase (Decrease) in Accrued Expenses 380,761 35,095 34,617
Increase (Decrease) in Deferred Revenue 0 0 0
--------- -------- --------
Total Adjustments to Net Income (Loss) $ 650,899 $ 43,583 $ 25,457
--------- -------- --------
NET CASH PROVIDED BY OPERATING ACTIVITIES $(1,238,715) $(14,473) $(36,353)
--------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
- -------------------------------------
Offering costs for Entrepreneur, Inc. $ (5,059) $ 0 $ 0
Purchase of furniture and fixtures (1,893) 0 0
Proceeds of sales of marketable securities 48,180 0 0
--------- -------- --------
NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES $ 41,228 $ 0 $ 0
--------- -------- --------
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE> 9
Health & Leisure, Inc. and Subsidiaries
(A Development Stage Company)
Consolidated Statements of Cash Flows (continued)
For the years ended December 31, 1995, 1994 and the
Period from March 13, 1985 (Date of Inception) through December 31, 1995
<TABLE>
<CAPTION>
Cumulative
During
Development
Stage 12/31/95 12/31/94
----- -------- --------
<S> <C> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
- -------------------------------------
New borrowings - Bank $ 370,051 $ 4,772 $ 62,320
New borrowing - Shareholder 147,272 21,272 2,000
Debt reduction:
Officers (140,300) 0 (32,000)
Bank (116,623) (8,393) (19,967)
Proceeds from sale of Common Stock 301,850 0 0
Proceeds from exercise of Series A Warrants 630,915 0 0
Proceeds from Donated Capital 7,500 0 0
----------- -------- --------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES $ 1,200,665 $ 17,651 $ 36,353
----------- -------- --------
Net Increase (Decrease) in Cash $ 3,178 $ 3,178 $ 0
----------- -------- --------
Cash, Beginning of Period $ 0 $ 0 $ 0
----------- -------- --------
Cash, End of Period $ 3,178 $ 3,178 $ 0
----------- -------- --------
Supplemental disclosure of cash flow information:
Cash paid during the year for interest $ 46,855 $ 1,902 $ 1,832
----------- -------- --------
</TABLE>
The accompanying notes are an
integral part of these financial statements
<PAGE> 10
HEALTH & LEISURE, INC. AND SUBSIDIARIES
(a Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following accounting principles and practices of Health & Leisure,
Inc. and Subsidiaries (the Company) are set forth to facilitate the
understanding of data presented in the consolidated financial statements.
1. Business Purpose
----------------
The Company was founded for the principal purpose of marketing a
disposable pad that produces heat instantaneously by exothermic reaction. The
markets for this product include medical, health, sports and leisure fields.
The market for the heat pads has not developed on a scale anticipated by
management and the sale of the heat pads has not resulted in profitable
operations. The Company is no longer actively marketing the heat pads.
Beginning March, 1990, through December 1991, the Company marketed a
long distance telephone service of American Telephone & Telegraph, Inc. (AT&T)
known as its Software Defined Network (SDN) service to primarily small and
mid-sized companies located throughout the United States. On December 28,
1990, the Company began conducting its telecommunicadons business through a 50%
interest In Telephony Woridwide Entwprise (TWE), a partnership. in 1991, the
Company recorded a loss from TWE of $19,861. In 1992, TWE ceased all business
activity, no losses were recorded for 1992. The Company divested itself of the
partnership in 1991 including all interest in the partnership and all
liabilites therefrom. As a result of the TWE partnership the Company recorded
Consulting Revenue in the amount of $12,667 ond $38,000 In 1991 and 1992,
respectively. (Note G).
Since 1991, the Company has been winding down all business activities
with respect to the heat pads and the SDN service and has been seeking a company
with which to effect a business combination.
In 1993, the Company began providing consulting services to
pharmaceutical companies. The Company's president, who is a registered
pharmacist, arranged for these services to help meet ongoing expenses. The
Company does not consider consulting to be its primary on-going business
operation and expects such services to cease before 1997.
2. Principles of Consolidation
---------------------------
The consolidated financial statements include the accounts of Health &
Leisure, Inc. and its subsidiaries, all of which are wholly-owned. Significant
intercompany accounts and transactions have been eliminated.
3. Development Stage of Operations
-------------------------------
The Company is a development stage company because it did not generate
significant ongoing revenue from the sales of heat pads and, with respect to SDN
service, has devoted substantially all of its efforts toward establishing its
business without generating significant revenue therefrom. Although the
Company is no longer actively pursuing the heat pad market nor the SDN service,
it still is considered a development stage company in that it is actively
seeking a viable alternative.
<PAGE> 11
4. Going Concerm Accounting Basis
------------------------------
The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the satisfaction
of liabilities in the normal course of business. Although the Company had
$495,398 and $556,632 worth of liabilities in 1994 and 1995, respectively, and
assets of $0 and $3,178 In 1994 and 1995, respectively $466,399 and $519,750 of
liabilities were payable to an officer of the Company in 1994 and 1995,
respectively.
5. Per Share Amounts
-----------------
Net loss per common share is computed based on the weighted average
number of common share outstanding for each period. Shares issuable upon
exercise of options are not included in the computation since their effect
would be antidilutive.
6. Inventories
-----------
Inventories are stated at the lower of cost (determined on a first-in,
first-out basis) or market, and include prepackaged heat pads. Inventory was
written-off in total in 1992 in the amount of $2,000. The Company had no
inventory at December 31, 1994 and 1995.
7. Property & Equipment
--------------------
Furniture and fixtures are recorded at cost. Depreciation is provided
using the straight-line method over an estimated useful life of five years.
As of 1991 those assets were fully depreciated.
8. Organizaion Costs
-----------------
Organization costs are amortized using the straight-line method over
five years. These costs were fully amortized as of 1991.
NOTE B - DEVELOPMENT STAGE AND GOING CONCERN
The market for the heat pads has not developed on a scale anticipated by
management and the sale of the heat pads has not resulted,in profitable
operations. The Company is no longer actively marketing this product. As a
result, the Company has experienced net losses of $58,056 and $64,827 years
1995, and 1994, respectively, and as of December 31, 1995 and 1994 has a
stockholders' deficit of $553,454 and $495,398, respectively. Net loss In 1991
included an extraordinary gain due to gain on extinguishment of debt for
$16,750 and a loss from its TWE partnership of $19,861. These factors, among
others, may indicate the Company will be unable to continue as a going concern.
The Company's continuation as a going concern depends upon its ability to
generate sufficient cash flow to conduct its operations and its ability to
obtain additional sources of capital and financing. The accompanying
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
In 1991, Management planned to mitigate the effect of the above
conditions through the expansion of its SDN service. Through the formation of a
joint veture general partnership (Note G), the Company received financing for
the business. Through the joint venture, the Company expected to obtain
revenues based, on the volume of usage billed to and collected from the SDN
customers. AT&T delayed billing the general partnership's SDN customers, which
resulted in substantial cash requirement problems for the Company. As a
result, the SDN project was abandoned In 1992.
<PAGE> 12
Management is currently seeking alternate sources of financing among
which is the search for a company with which to combine operations.
NOTE C - BUSINESS COMBINATION
The Company was incorporated on March 13, 1985 under the laws of the
State of Utah with the name of Univenture Capital Corporation. On August 29,
1986 Univenture Capital Corporation (Univenture) issued 7,700,000 shares of
common stock to stockholders of Health & Leisure, Inc. (which subsequently
changed its name to Entre Vest, Inc.) for all the outstanding stock of Health
Leisure, Inc. This tramsaction was treated as a recapitalization of Health &
Leisure, Inc. and the financial statements of both companies were combined to
reflect this transaction retroactively to March 13, 1985 (date of inception).
Prior to this transaction, results of operations from January 1, 1986 through
August 29, 1986 included losses of $13,000 and $77,000 for Univenture and
Health & Leisure, Inc., respectively. Univenture had previously reported no
income or expense for the period ended December 31, 1985 Univenture has since
changed its name to Health & Leisure, Inc.
In 1987, the Company formed Entrepreneur, Inc., a wholly-owned
subsidiary, as a public corporation, with no initial operations of its own, for
the purpose of searching for and combining with an existing privately-held
company in a form which would result in the combined entity being a public
corporation. In 1988, the Company distributed all shares in a dividend of
498,771 shares of common stock and 498,771 Class A common stock warrants to
existing stockholders.
In 1990, the Company formed Amtele, Inc., a wholly-owned Delaware
subsidiary, for the purpose of marketing AT&T's SDN service, and Venture Sum,
Inc., a wholly-owned Delaware subsidiary, for the purpose of searching for and
combining with an existing privately-held company in a form of which would
result in the combined entity being a public corporation.
NOTE D - INVENTORIES
During 1990, the Company reduced the carrying amount of inventories by
approximately $47,000 to record the decreased market value of the heat pads
(Note B). In 1992, the Company ceased marketing the heat pads and wrote-off the
remaining $2,000 in inventory to cost of sales. (Note A)
NOTE E - NOTES PAYABLE AND LONG-TERM DEBT
During 1988, the Company obtained a $100,000 term loan from a bank,
payable in monthly installments of $2,778, plus interest at prime plus 2% due
March, 1991. The note was collateralized by accounts receivable and inventory
and personally guaranteed by the Company's president. During 1989, the loan
was changed to a demand note, with no other changes to its terms. During 1990,
the loan was changed to a prime (10% as of December 31, 1990) plus 1% note due
in monthly installments of $1,000 plus interest through April, 1994. In 1993,
the payments on the note were changed to $1,000 per month including interest.
In March, 1994 the Company renewed the note with an additional $26,000
borrowing. An additional borrowing of $4,772 was made in April, 1995.
The Company has an unsecured note payable due to the President with
interest accrued at the applicable federal rate. Principal and interest were
originally due January 31, 1992 but the note has subsequently been renewed.
Payments are to begin in 1997. (Note H).
In 1988, the Company reached an agreement with the president whereby
$150,538 due him was forgiven by him as of December 31, 1988. The remaining
balance due the president is maintained under the terms of the note described
above.
<PAGE> 13
Long-term debt consists of the following as of December 31, 1995 and 1994:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Note payable to officer $ 205,615 184,343
Note payable to bank 14,149 17,770
------- -------
219,764 205,113
Less current portion 12,000 12,000
------- -------
$ 207,764 193,113
======= =======
</TABLE>
The aggregate maturities of long-term debt for the five years ending
December 31, 1999 follows:
<TABLE>
<S> <C>
1994 $ 11,736
1995 2,149
1996 - 0 -
1997 34,269
1997 34,269
------
$ 82,423
======
</TABLE>
NOTE F - PREFERRED AND COMMON STOCK
During 1986, a total of 20,000,000 Series A and Series B warrants were
issued in registered form. They were tradeable separately in the
over-the-counter market. Each warrant evidenced the right to purchase one share
of common stock.
During 1987 and 1986, 100,000 and 6,254,270 Series A warrants were
exercised, respectively at $.1O per share. No warrants were exercised during
1988, and all remaining warrants expired in 1988.
The Company issued 200,000 shares of common stock as a finder's fee
during 1987. The finder's fee was valued at $2,000 based upon the par value of
the stock.
On May 2, 1988, the Company effected a one-for-ten reverse split. The
common stock outstanding at that date was reduced from 99,754,275 to 9,975,427
and the authorized common stock changed from 200,000,000 shares, $.OO1 par
value to 20,000,00 shares, $.O1 par value.
The Company authorized 10,000,000 shares of preferred stock, $.O1 par
value, pursuant to an amendment to the Company's certificate of incorporation
Filed May 2, 1988. The amended certificate permits the Board of Directors to
issue one or more series of the preferred stock on terms and conditions approved
by the Board of Directors without further action by the stockholders. No shares
of preferred stock were issued as of December 31, 1995 nor 1994.
In 1989, the Company entered into an agreement with its president to
discharge indebtedness aggregating $120,000 in exchange for 2,000,000 shares of
the Company's common stock. This transaction was recorded as a capital
contribution by the Company's president which increased common stock and
additional paid-in capital by $120,000 in 1989.
In 1989, the Company sold 1,000,000 shares of common stock for $60,000
to a director of the Company and signed subscription agreements to issue
500,000, shares of common stock for $50,000, which was received in January,
1990. During 1989, the president individually entered into agreements with two
creditors whereby he transferred certain personal assets in full settlement of
the amounts due the creditors in the aggregate of $91,415. These settlement
agreements have been treated as a capital contribution by the Company's
president. During 1989, the president contributed $15,000 of marketable
securities to the Company.
<PAGE> 14
On May 25, 1990, the Company issued 1,000,000 shares of common stock to
a vice president of the Company as a signing bonus in consideration for his
acceptance of the position. The shares were recorded at $.10 per share based
on the fair market value of the shares, established by a previous sale to
unrelated parties.
On June 1, 1990, the stockholders of the Company authorized an
additional 10,000,000 shares of common stock for the Company.
During 1990, the Company issued 2,000,000 shares of common stock to
consultants of the Company (recorded as compensation at the contractually
stated fair value of the services performed) and 850,000 shares pursuant to
stock subscription agreements.
NOTE G - INVESTMENT IN PARTNERSHIP
On December 28, 1990, Amtele, Inc. (Amtele) a wholly-owned subsidiary
of the Company, formed Telephone Worldwide Enterprise (TWE), a Califomia
general partnership, with a California corporation. In connection with the
formation of TWE, Amtele obtained a 50% interest by contributing all of Its
rights, title and interest in the AT&T contract and all of its
telecommunications contracts, including contracts with marketing groups and
SDN customers which, due to their nature, had no book value. The California
corporation obtained its 50% interest by agreeing to contribute $400,000. The
California corporation contributed $100,000 on December 28, 1990, of which
$50,667 was paid to the Company for a noncompetition agreement expiring on
December 28, 1994 (recorded as deferred revenue on the accompanying
consolidated balance sheets) and $49,333 was used to pay liabilities of Amtele
assumed by TWE, and TWE expenses. The remaining $300,000 was paid in 1991.
All agreements including the employment agreement were revised in 1991
and the California corporation took over the operations and accounting for TWE
in October, 1991. The consulting fees at $8,000 per month were accrued for the
first nine months of the year and adjusted notes payable to TWE for that amount
eliminating entirely the note payable to TWE. All agreements were cancelled
October, 1991 thereby eliminating any further accrual of consulting fees from
that time forward.
The Company recorded a loss for TWE of $19,801 In 1991. No further
transactions were recorded on the Company's books for TWE except for $12,667
representing income from the noncompete agreement in 1991; and, in 1992,
recorded consulting income of $38,000 representing the deferred revenue. The
partnership was dissolved In 1992.
NOTE H - RELATED PARTY TRANSACTIONS
Wages were accrued for the president at $2,000 per month in 1995 and
1994. The president has also personally paid certain expenses for the Company
increasing the note payable to the president to $205,615 and $184,343 in 1995
and 1994, respectively, accruing interest at the applicable federal rate with
payments to begin in 1997. Long-term debt to officer includes $15,000 the
president loaned the Company for expenses from the TWE partnership joint
venture.
NOTE I - INCOME TAXES
As a result of consolidated operating losses, no provision for income
taxes was necessary. As of December 31, 1995, the Company has net operating
loss carryforwards of approximately $1,550,000 available to reduce future
taxable income expiring in 2005 through 2010. Ultimate utilization of the
net operating loss carryforwards will be subject to limitation and the
existence of future taxable income.
<PAGE> 15
NOTE J - SIGNIFICANT CUSTOMERS
The Company, while in the development stage, has had limited
distribution of the heat pads and, therefore, a limited number of customers.
As such, substantially all of its total sales during the four years ended
December 31, 1993 have been to six customers. Consulting income has been
derived from only two sources.
NOTE K - COMMITMENTS AND CONTINGENCIES
The Company leases office space on a month-to-month basis. Rent
expense was $2,520 in 1995 and 1994. Rent is $210 per month. In 1992, the
Company entered into an operating lease for an automobile which requires
monthly payments of $279 until September, 1995. In September 1995 a new
operating lease for a vehicle was entered into which requires monthly payments
of $352 until August, 1998. Auto lease expense was $4,067 and $3,002 in 1995
and 1994, respectively.
NOTE L - OTHER
The Company currently has three (3) wholly-owned subsidiaries. There
has been essentially no activity in these subsidiaries in 1992 through 1995.
Amtele, Inc. (Amtele), a wholly-owned subsidiary of the Company was organized
to contract with AT&T for the TWE partnership joint venture. All activity in
Amtele ceased in 1991. The Company anticipates merging or dissolving the
wholly-owned subsidiaries in 1996.
The Company continues to operate on a very limited basis with the only
activity being that of the Company's president actively seeking a company with
which to effect a business combination and the pharmaceutical consulting. In
this process, he has incurred travel expenses through December 31, 1995.
<PAGE> 1
EXHIBIT 6
POWERS OF ATTORNEY
- 36 -
<PAGE> 2
POWER OF ATTORNEY
FOR ANNUAL REPORTS ON FORM 10-KSB
The undersigned, a director or officer of Health & Leisure, Inc., a
Delaware corporation (the "Company"), hereby constitutes and appoints Robert M.
Feldman, my true and lawful attorney-in-fact and agent, with full power to act,
for me and in my name, place, and stead, in my capacity as director or officer
of the Company, to execute the Company's Form 10-KSB on Form 10-K Annual Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
Company's fiscal year ended December 31, 1995, and any and all amendments
thereto, and to file the same, with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as I might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, may
lawfully do or cause to be done by virtue hereof.
The undersigned has executed and delivered this Power of Attorney on
April 4, 1996.
/s/ Burton Schildhouse Secretary, Treasurer and Director
- ---------------------------- ---------------------------------
Signature Position(s) with the Company
Burton Schildhouse
- ----------------------------
Print or Type Name
- 37 -
<PAGE> 3
POWER OF ATTORNEY
FOR ANNUAL REPORTS ON FORM 10-KSB
The undersigned, a director or officer of Health & Leisure, Inc., a
Delaware corporation (the "Company"), hereby constitutes and appoints Robert M.
Feldman, my true and lawful attorney-in-fact and agent, with full power to act,
for me and in my name, place, and stead, in my capacity as director or officer
of the Company, to execute the Company's Form 10-KSB on Form 10-K Annual Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
Company's fiscal year ended December 31, 1995, and any and all amendments
thereto, and to file the same, with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as I might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, may
lawfully do or cause to be done by virtue hereof.
The undersigned has executed and delivered this Power of Attorney on
April 4, 1996.
/s/ Arthur Aaronson Director
- ---------------------------- ----------------------------
Signature Position(s) with the Company
Arthur Aaronson
- ----------------------------
Print or Type Name
- 38 -
<PAGE> 4
POWER OF ATTORNEY
FOR ANNUAL REPORTS ON FORM 10-KSB
The undersigned, a director or officer of Health & Leisure, Inc., a
Delaware corporation (the "Company"), hereby constitutes and appoints Robert M.
Feldman, my true and lawful attorney-in-fact and agent, with full power to act,
for me and in my name, place, and stead, in my capacity as director or officer
of the Company, to execute the Company's Form 10-KSB on Form 10-K Annual Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
Company's fiscal year ended December 31, 1995, and any and all amendments
thereto, and to file the same, with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as I might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, may
lawfully do or cause to be done by virtue hereof.
The undersigned has executed and delivered this Power of Attorney on
April 3, 1996.
/s/ James S. Koroloff Director
- --------------------------- ----------------------------
Signature Position(s) with the Company
James S. Koroloff
- ---------------------------
Print or Type Name
- 39 -
<PAGE> 5
POWER OF ATTORNEY
FOR ANNUAL REPORTS ON FORM 10-KSB
The undersigned, a director or officer of Health & Leisure, Inc., a
Delaware corporation (the "Company"), hereby constitutes and appoints Robert M.
Feldman, my true and lawful attorney-in-fact and agent, with full power to act,
for me and in my name, place, and stead, in my capacity as director or officer
of the Company, to execute the Company's Form 10-KSB on Form 10-K Annual Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the
Company's fiscal year ended December 31, 1995, and any and all amendments
thereto, and to file the same, with all exhibits thereto and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as I might or could do in person,
hereby ratifying and confirming all that said attorney-in-fact and agent, may
lawfully do or cause to be done by virtue hereof.
The undersigned has executed and delivered this Power of Attorney on
April 9, 1996.
/s/ Donald S. Franklin Director
- ---------------------------- ----------------------------
Signature Position(s) with the Company
Donald S. Franklin
- ----------------------------
Print or Type Name
- 40 -
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AND STATEMENT OF OPERATIONS OF HEALTH & LEISURE, INC. AND ITS SUBSIDIARIES
AS OF DECEMBER 31, 1995 AND FOR THE YEAR THEN ENDED AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 3,178
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,178
<PP&E> 1,893
<DEPRECIATION> 1,893
<TOTAL-ASSETS> 3,178
<CURRENT-LIABILITIES> 348,868
<BONDS> 207,764
<COMMON> 173,254
0
0
<OTHER-SE> (726,708)
<TOTAL-LIABILITY-AND-EQUITY> 3,178
<SALES> 0
<TOTAL-REVENUES> 59,065
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 117,121
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (58,056)
<INCOME-TAX> 0
<INCOME-CONTINUING> (58,056)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (58,058)
<EPS-PRIMARY> (0.003)
<EPS-DILUTED> (0.003)
</TABLE>
