<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 1, 2000
REGISTRATION NO. 333-82217
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
ON FORM S-3
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FINET.COM, INC.
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C> <C>
DELAWARE 6162 94-3115180
(State or other jurisdiction (Primary Standard (I.R.S. Employer
of Industrial Identification No.)
incorporation or organization) Classification Code No.)
</TABLE>
2527 CAMINO RAMON, SUITE 200, SAN RAMON, CALIFORNIA 94583
TELEPHONE: (925) 242-6600
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
RICK COSSANO, PRESIDENT,
CHIEF EXECUTIVE OFFICER
2527 CAMINO RAMON, SUITE 200,
SAN RAMON, CALIFORNIA 94583
TELEPHONE: (925) 242-6600
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------------------
COPIES TO:
<TABLE>
<S> <C>
ROGER S. MERTZ STEPHEN C. FERRUOLO
ALLEN, MATKINS, LECK, GAMBLE & MALLORY LLP HELLER EHRMAN WHITE & MCAULIFFE LLP
333 BUSH STREET, SEVENTEENTH FLOOR 525 UNIVERSITY AVENUE
SAN FRANCISCO, CALIFORNIA 94104-2806 PALO ALTO, CALIFORNIA 94301
TELEPHONE: (415) 837-1515 TELEPHONE: (650) 324-7000
FACSIMILE: (415) 837-1516 FACSIMILE: (650) 324-0638
</TABLE>
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT.
--------------------------
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, check the following
box and list the Securities Act registration 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 of 1933, 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 of 1933, 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: / /
--------------------------
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.
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<PAGE>
SUBJECT TO COMPLETION, DATED AUGUST 1, 2000
THE INFORMATION IN THIS PRELIMINARY PROSPECTUS IS NOT COMPLETE AND MAY BE
CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION BECOMES EFFECTIVE. THIS PRELIMINARY
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.
<PAGE>
PROSPECTUS
FINET.COM, INC.
76,107,995 SHARES
COMMON STOCK
The selling stockholder identified in this prospectus is offering 76,107,995
shares of common stock. FiNet.com will not receive any of the proceeds from the
sale of shares by the selling stockholders.
FiNet.com's common stock is traded on the Nasdaq SmallCap Market under the
symbol "FNCM." On July 28, 2000, the last reported sale price for the common
stock on the Nasdaq SmallCap Market was $0.75 per share.
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE "RISK
FACTORS" BEGINNING ON PAGE 3.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER REGULATORY BODY
HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
------------------------
The date of this Prospectus is , 2000.
<PAGE>
You should rely only on the information contained in this prospectus. We
have not authorized anyone to provide you with information different from that
contained in this prospectus. The selling security holder is offering to sell,
and seeking offers to buy, shares of FiNet.com's common stock only in
jurisdictions where offers and sales are permitted. The information contained in
this prospectus is accurate only as of the date of this prospectus, regardless
of the time of delivery of this prospectus or of any sale of the shares.
In this prospectus, the "company," the "Registrant," "FiNet.com," "we,"
"us," and "our" refer to FiNet.com, Inc.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to "incorporate" into this prospectus information we file
with the SEC in other documents. This means that we can disclose important
information to you by referring to other documents that contain that
information. The information may include documents filed after the date of this
prospectus which update and supersede the information you read in this
prospectus. We incorporate by reference the documents listed below, except to
the extent information in those documents is different from the information
contained in this prospectus, and all future documents filed with the SEC under
Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until
we terminate the offering of these shares.
<TABLE>
<CAPTION>
SEC FILING (FILE NO. 0-18108) PERIOD/FILING DATE
--------------------------------------------- ---------------------------------------------
<S> <C>
Annual Report on Form 10-K Eight months ended December 31, 1999
Quarterly Reports on Forms 10-Q Quarter ended March 31, 2000
Current Reports on Form 8-K May 3, 2000
</TABLE>
You may request a copy of these documents, at no cost, upon oral request, or by
writing to:
FiNet.com, Inc.
2527 Camino Ramon, Suite 200
San Ramon, California 94583
Attention: Investor Relations
Telephone: (925) 242-6600
------------------------
2
<PAGE>
SUBSEQUENT EVENTS
Gary A. Palmer, our Chief Financial Officer, has resigned effective
August 15, 2000 citing personal reasons.
On May 31, 2000, our agreement with our primary warehouse lender expired.
Our lender amended our agreement, extending the maturity date to October 15,
2000. As of June 30, 2000, we were not in compliance with the liability growth
covenants of our primary warehouse lending agreement. Our lender waived this
event of default and removed this covenant requirement effective July 14, 2000.
On July 19, 2000, we entered into a loan participation agreement with
Gateway Bank, whereby we may sell a participation interest in mortgage loans to
Gateway. This agreement supports our working capital needs as it allows us to
fund our planned volume increases without reducing our committed warehouse
borrowing capacity. The maximum total participation outstanding allowed is $20
million. When participated interests are subsequently sold in the secondary
market, the total amount participated with Gateway will be reduced. In
connection with the participation agreement, Gateway will earn a yield on
participated balances of prime minus 1%. This agreement expires on July 31,
2001.
On December 16, 1999, a lawsuit was filed in the Judicial District Court of
Dallas County, Texas, by FC Capital Corp. d/b/a First City Capital Corporation
("First City"). The complaint alleges breach of contract by Coastal Federal
Mortgage ("Coastal") for failure to repurchase loans in accordance with the
terms and conditions of a purchase agreement entered into by Coastal and First
City in March 1998. The plaintiff has named Finet as a defendant alleging that
Finet assumed all of Coastal's debts and obligations when Finet acquired Coastal
in April 1998. The plaintiff seeks to recover actual damages in the amount of
$1.7 million and premium rebates in the approximate amount of $26,000. The
action was removed to the United States District Court, Northern District of
Texas, Dallas Division ("Court") on January 18, 2000. On May 31, 2000 the Court
granted Finet's Motion to Dismiss for Lack of Personal Jurisdiction and
dismissed the action without prejudice. Thereafter, FiNet and Coastal filed a
declaratory relief action against First city in the San Francisco Superior Court
with respect to the issues that had been reaised by First City in the dismissed
Texas action. First City removed the action to the United States District Court,
Northern District of California, and filed a motion to dismiss or in the
alternative to change venue to New York. A hearing on the motion to dismiss is
scheduled for August 28, 2000. FiNet intends to defend vigorously against the
action and believes that the ultimate resolution will not have a material
adverse effect on its business, results of operations or financial condition.
An employment dispute exists between FiNet and its former Executive Vice
President of Capital Markets, Michael Conway, who was terminated by FiNet
effective February 1, 2000. Mr. Conway alleges that his termination was nor for
"just cause" as that term is defined in his written Employment and Compensation
Agreement ("Agreement"), and that he is therefore entitled to a continuation of
his salary through the termination date under the Agreement and the immediate
vesting of all options or damages in an equivalent amount and seeks punitive
damages as to certain claims. The dispute was submitted unsuccessfully for
mediation in March and is now scheduled for arbitration on October 30, 2000.
FiNet intends to defend vigorously against the action and believes that the
ultimate resolution will not have a material adverse effect on its business,
results of operations or financial condition.
RISK FACTORS
YOU SHOULD CAREFULLY CONSIDER THE RISKS DESCRIBED BELOW BEFORE MAKING A
DECISION TO BUY OUR COMMON STOCK. THE RISKS DESCRIBED BELOW ARE NOT THE ONLY
ONES WE FACE. ADDITIONAL RISKS NOT PRESENTLY KNOWN TO US OR THAT WE CURRENTLY
CONSIDER IMMATERIAL MAY ALSO MATERIALLY IMPAIR OUR BUSINESS OPERATIONS.
IF ANY ONE OR MORE OF THE RISKS DESCRIBED BELOW ACTUALLY OCCURS, THE PRICE
OF OUR SHARES MAY DECLINE AND YOU MAY LOSE ALL OR PART OF YOUR INVESTMENT.
3
<PAGE>
Many of the risks described below could materially adversely affect our
business, results of operations and financial condition, which, in turn, could
cause the price of our shares to decline, resulting in a loss of all or part of
your investment. We cannot predict which, if any, of these risks may actually
occur, or the extent to which any occurrence, circumstance or event will
actually affect our business, results of operations or financial condition, and
the trading price of our shares.
BECAUSE WE EXPECT CONTINUED LOSSES IN THE FUTURE, OUR BUSINESS, FINANCIAL
CONDITION AND GROWTH PROSPECTS COULD BE MATERIALLY ADVERSELY AFFECTED.
We have incurred net losses of $9.4 million, $36.5 million and
$25.3 million for fiscal 1998 and 1999 and the eight months ended December 31,
1999, respectively, and at March 31, 2000, we had an accumulated deficit of
approximately $79.7 million. Although we cannot predict future results of
operations with any degree of certainty, we expect to continue to incur losses
because of the current state of the mortgage market and our plans to continue to
invest in information technology and geographic expansion of our business. While
we do not believe these losses will exhaust our credit lines or available
capital resources in the year ending December 31, 2000, we may not be able to
implement our business plans, and our business, results of operations financial
condition and growth prospects could be materially adversely affected.
IF OUR NEW MANAGEMENT IS NOT ABLE TO EXPAND AND IMPROVE OUR OPERATIONS, OUR
BUSINESS WOULD SUFFER.
Since December 1999, we have replaced most of our management team. Our new
officers have not previously worked together, and we cannot be sure that they
will be able to work together to improve and expand our operations.
On February 1, 2000, Rick Cossano became our President and Chief Executive
Officer replacing Mark Korell, who retired effective January 15, 2000. Robert
Snow, became our Executive Vice President, Business to Business, on January 31,
2000. Michael Quinn became our Senior Vice President, Director of Capital
Markets on April 1, 2000. If the new management team is not able to work
together and improve and expand our operations, our financial condition,
profitability and growth prospects would be materially adversely affected.
THE LOSS OF ANY OF OUR KEY PERSONNEL WOULD LIKELY HAVE AN ADVERSE EFFECT ON OUR
BUSINESS.
We believe that our future success will depend to a significant extent on
the continued services of our new senior management and other key personnel. The
loss of the services of key employees or delay in recruiting candidates to fill
our currently vacant management positions or any other key position which may
become vacant could have a material adverse effect on our business, results of
operations and financial condition.
IF WE ARE UNABLE TO MANAGE GROWTH IN OUR BUSINESS, OUR RESULTS OF OPERATIONS MAY
NOT IMPROVE.
We anticipate that we will need to expand our employee base, facilities and
infrastructure in order to be able to compete successfully and take advantage of
market opportunities. If we are unable to manage the expansion of our business
effectively, our business, results of operations and financial condition may not
improve and could deteriorate. We expect this expansion to place significant
strain on our management, operational and financial resources. Our current
personnel, systems, procedures and controls are not adequate to support
anticipated growth of our operations. To manage this expected growth, we will
need to improve our mortgage processing, operational and financial systems,
information processing capacity, procedures and controls. We may be unable to
hire, train, retain or manage necessary personnel, or to identify and take
advantage of existing and potential strategic relationships and market
opportunities.
4
<PAGE>
IF THERE IS A FURTHER DECREASE IN THE DEMAND FOR MORTGAGES, OUR BUSINESS COULD
SUFFER.
Demand for mortgages is typically adversely affected by periods of economic
slowdown or recession, rising interest rates, declining demand for consumer
credit, declining home sales, declining real estate values and decreased ability
of borrowers to make loan payments. These factors tend to decrease demand for
mortgage loans of the types we originate and could increase the rates of
delinquencies and foreclosures on loans we hold. These changes would likely have
a material adverse effect on our business, results of operations and financial
condition.
Over the last seven years we have generally operated in an environment of
relatively low interest rates, relatively high demand for consumer credit and
increasing home sales and real estate values. However, the mortgage market has
contracted during 1999 and early 2000 with the increase in interest rates, and
this contraction may continue for some time. We cannot be sure that we will be
able to grow our business in an atmosphere of higher interest rates, lower
consumer credit demand and real estate value and fewer home sales and mortgage
refinances.
IF OUR SHARES ARE DELISTED, THE LIQUIDITY FOR OUR SHARES COULD BE IMPAIRED.
If we fail to meet the NASD's continued listing requirements, including,
among others, net tangible assets or market capitalization, minimum bid price
and various corporate governance requirements, our shares could be delisted from
the Nasdaq SmallCap Market. In such event, trading, if any, in our common stock
would thereafter be conducted in the over-the-counter markets in the so-called
"pink sheets" or the NASD's "Electronic Bulletin Board." Consequently, the
liquidity of our shares could be impaired, not only in the number of shares
which could be bought and sold, but also through delays in the timing of the
transactions, reductions in the number and quality of security analysts' and the
news media's coverage of the company, and lower prices for our shares than might
otherwise be attained.
IF OUR SHARES ARE DELISTED, OUR SHARES COULD BECOME SUBJECT TO THE SEC'S "PENNY
STOCK" RULE.
If our shares were delisted from Nasdaq, they could become subject to
Rule 15g-9 under the Securities Exchange Act of 1934, which imposes additional
sales practice requirements on broker-dealers which sell such securities to
persons other than established customers and "accredited investors" (generally,
individuals with net worth in excess of $1,000,000 or annual incomes exceeding
$200,000 or $300,000 together with their spouses). For transactions covered by
this rule, a broker-dealer must make a special suitability determination for the
purchase and have received the purchaser's written consent to the transaction
prior to sale. Consequently, the rule may adversely affect the ability of
broker-dealers to sell our shares and may adversely affect the ability of
purchasers in this offering to sell any of the securities acquired in the
secondary market. If our shares become subject to this rule, market liquidity
for our shares could be severely adversely affected.
IF WE ARE UNABLE TO DIFFERENTIATE OURSELVES FROM COMPETITION IN OUR INDUSTRY,
OUR BUSINESS PROSPECTS COULD BE HARMED.
The e-mortgage market is new, rapidly evolving and intensely competitive.
Because the barriers to entry are minimal, we expect competition to intensify in
the future.
In addition, the residential mortgage loan business is highly competitive.
We currently compete with a variety of other companies offering mortgage
services, including:
- various on-line mortgage brokers, including E-LOAN Inc., iOwn.com,
Mortgage.com, Quicken Mortgage and Keystroke Financial;
- mortgage companies that offer products through on-line search engines,
such as Yahoo! and Microsoft Corporation's Home Advisor website;
5
<PAGE>
- mortgage banking companies, commercial banks, savings associations, credit
unions and other financial institutions which still originate the vast
majority of mortgage loans; and
- mortgage brokers.
Many of our mortgage banking and mortgage brokerage competitors have longer
operating histories or significantly greater financial, technical, marketing and
other resources than we do. Some of our on-line competitors are spending
substantial funds on mass marketing and branding their mortgage services. In
addition, some of our competitors offer a wider range of services and financial
products to customers and have the ability to respond more quickly to new or
changing opportunities. As a result, many have greater name recognition and more
extensive customer bases and can offer more attractive terms to customers,
including more aggressive loan pricing policies. We cannot be sure that we will
be able to compete successfully against current and future competitors. If we
are unable to do so it will have a material adverse effect on our business,
results of operations and financial condition.
IF INTEREST RATES CONTINUE TO RISE, OUR RESULTS OF OPERATIONS COULD BE
MATERIALLY ADVERSELY AFFECTED.
Rising interest rates generally discourage refinancing of residential
mortgages and reduce the number of new home sales. Any further increase in
interest rates or an adverse change in the residential real estate market or
general economic conditions, both of which are outside our control, could have a
material adverse effect on our business, results of operations and financial
condition.
The effect of interest rate changes tends to be greater on the market for
refinancing loans than it is on the market for purchase loans, since refinancing
a mortgage loan is voluntary and motivated primarily by a homeowner's desire to
lower financing costs, whereas new home purchasers are motivated by a need or
desire for a new home. Accordingly, the annual volume of new mortgage refinance
loans is quite volatile. Approximately 45% of the loans we originated and/or
funded during the eight months ended December 31, 1999 were loans to refinance
mortgage debt, compared to 73% during the eight months ended December 31, 1998.
We cannot predict future interest rate trends, their impact on our business, or
our ability to manage this business mix.
The value of the loans we make is based, in part, on market interest rates,
and our business, results of operations and financial condition may be
materially adversely affected if interest rates change rapidly or unexpectedly.
If interest rates rise after we fix a price for a loan but before we sell the
loan into the secondary market, the value of that loan will decrease. If we
delay in selling our loans into the secondary market, our interest rate exposure
increases and we could incur a loss on the sale. While we use various hedging
strategies to provide some protection against interest rate risks, no hedging
strategy can protect us completely. The nature and timing of hedging
transactions influences the effectiveness of hedging strategies and poorly
designed strategies or improperly executed transactions may increase rather than
decrease risk. In addition, hedging strategies involve transaction and other
costs. There is a risk that our hedging strategy and the hedges that we make
will not adequately offset the risks of interest rate volatility and that our
hedges will result in losses.
IF WE FAIL TO MAINTAIN CREDIT FACILITIES TO FINANCE OUR MORTGAGE LENDING
ACTIVITIES, OUR GROWTH PROSPECTS COULD BE SEVERELY LIMITED.
To the extent that we are unable to access adequate capital to fund loans,
we may have to curtail or cease our loan funding activities entirely. This would
have a material adverse effect on our business, results of operations and
financial condition. Because we are not a bank, we are dependent upon
specialized mortgage credit facilities from other lenders to finance our
mortgage lending activities. Our $75 million committed warehouse borrowing
agreement with GMAC/RFC expired on May 31, 2000. Our lender amended our
agreement, extending the maturity date to October 15, 2000. In the agreement we
make numerous representations, warranties and operating and financial covenants.
A material breach by FiNet.com of any of these representations, warranties or
covenants could result in
6
<PAGE>
the termination of the agreement and an obligation to repay the entire amount
outstanding under the agreement. As of June 30, 2000, we were not in compliance
with compliance with the liability growth covenants of our primary warehouse
lending agreement. Our lender waived this event of default and removed this
covenant effective July 14, 2000. We cannot assure you that financing will
continue to be available on favorable terms or at all.
IF WE ARE UNABLE TO RESPOND TO RAPID TECHNOLOGICAL CHANGE IN E-COMMERCE AND
IMPROVE OUR PRODUCTS AND SERVICES, OUR BUSINESS COULD BE MATERIALLY ADVERSELY
AFFECTED.
The Internet and e-commerce are characterized by rapid technological change,
changes in user and customer requirements and preferences, frequent new product
and service introductions embodying new technologies, and the emergence of new
industry standards and practices that could render existing technology and
systems obsolete. There can be no assurance that we will successfully use new
technologies effectively or adapt our websites, technology and
transaction-processing systems to customer requirements or emerging industry
standards. If we are unable to license and internally develop leading
technologies useful in our business, enhance our existing services, develop new
services and technology that address the increasingly sophisticated and varied
needs of our customers, and respond to technological advances and emerging
industry standards and practices on a cost-effective and timely basis, we will
not remain competitive and our business, results of operations and financial
condition could be materially adversely affected.
IF WE ARE UNABLE TO RETAIN AND ATTRACT QUALIFIED PERSONNEL, OUR BUSINESS COULD
SUFFER.
Our ability to grow and our future success depends on our ability to
identify, attract, hire, train, retain and motivate other highly skilled
technical, managerial, sales and marketing, customer service and professional
personnel. Competition for such employees is intense, especially in the
e-commerce sector, and there is a risk that we will not be able to successfully
attract, assimilate or retain sufficiently qualified personnel. If we fail to
retain and attract the necessary technical, managerial, sales and marketing,
customer service personnel and experienced professionals, our business, results
of operations and financial condition could be materially adversely affected.
IF CONSUMERS AND MORTGAGE BROKER BUSINESSES DO NOT EMBRACE ON-LINE MORTGAGE
FINANCING AND SALES, OUR BUSINESS WILL BE MATERIALLY ADVERSELY AFFECTED.
Our success depends upon the acceptance of on-line mortgage financing by
consumers, mortgage brokers and other real estate service providers.
If the market for on-line mortgage financing fails to develop, or develops
more slowly than expected, our business, results of operations and financial
condition would be materially adversely affected. In addition, if there are
insufficient communications services to support the Internet, it could result in
slower response times which would adversely affect usage of the Internet. Even
if use of the Internet for on-line financing gains acceptance, we may be unable,
for technical or other reasons, to develop and introduce new products and
services or enhancements in a timely manner, and such products and services and
enhancements may not gain widespread market acceptance. Any of these factors
could have a material adverse effect on our business, results of operations and
financial condition.
IF THERE IS A RECESSION, NATURAL DISASTER OR OTHER DISRUPTION IN THE CALIFORNIA
ECONOMY, OUR BUSINESS COULD BE MATERIALLY ADVERSELY AFFECTED.
We are particularly vulnerable to recessions and conditions affecting the
California economy. Of the loans we originated and/or funded in the eight months
ended December 31, 1999, 87% were for properties located in California. No other
state represented more than 2% of our closed loans during
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<PAGE>
such period. While we expect to expand our business in other states, a
concentration of loans in California is likely to continue for the foreseeable
future.
There have been times in the past, most recently in 1991 and 1992, when the
California economy suffered a recession more severe than the rest of the
country. If such a recession were to occur again, our business, results of
operations and financial condition would be materially adversely affected.
In addition, California historically has been vulnerable to natural
disasters, such as earthquakes and mudslides, which are not typically covered by
standard hazard insurance policies. These natural disasters often result in
increased loan delinquencies or defaults which could adversely effect on our
business, results of operations and financial condition.
IF WE HAVE TO REPURCHASE LOANS ORIGINATED FOR OR SOLD TO LENDERS, OUR OPERATING
RESULTS COULD BE MATERIALLY ADVERSELY AFFECTED.
There is a risk that we will not have sufficient funds to repurchase loans
upon demand or that such repurchases will have a material adverse effect on our
business, results of operations and financial condition. Under agreements with
some of our lenders, they may require us to repurchase loans that we originate
for them, or they purchase from us, in the event of material misrepresentations
by us or inaccuracies in the borrowers' loan documents. In the eight months
ended December 31, 1999, our Coastal Federal Mortgage, Mical Mortgage and
Monument Mortgage subsidiaries were required to repurchase approximately $0,
$6.5 million and $465,000 principal amount of loans, respectively. In the three
months ended March 31, 2000, our Coastal Federal Mortgage, Mical Mortgage and
Monument Mortgage subsidiaries were required to repurchase approximately $0,
$139,000 and $0 principal amount of loans, respectively. It is possible that
future demands will be made to purchase loans originated and sold by these
subsidiaries.
8
<PAGE>
As a result of repurchases, we occasionally are required to hold foreclosed
residential real estate in inventory until it can be resold. Future foreclosures
could have a material adverse effect on our business, results of operations and
financial condition. If interest rates rise and the economy declines, the rate
of mortgage loan foreclosures may rise. Depending on the circumstances of the
transaction, we may or may not be able to sell the property for more than the
outstanding loan balance. As of March 31, 2000, we held approximately $298,000
aggregate principal amount of loans in foreclosure.
PROBLEMS AND RISKS RELATED TO POTENTIAL ACQUISITIONS AND ALLIANCES MAY HARM OUR
BUSINESS.
To implement our growth strategy we may acquire or enter into alliances with
companies with complementary services, technologies and businesses. In
connection with any such acquisition, we may fail to successfully integrate the
operations of the acquired company. For example, as described more completely
below under "We may incur additional losses from the discontinued operations of
Coastal Federal Mortgage and Mical Mortgage," we incurred significant losses
following our acquisitions of Mical Mortgage and Coastal Federal Mortgage, and
they have discontinued their operations. Any future alliances we pursue may not
be successful. Also, acquisitions or alliances could divert our management's
attention from other business matters, or we could lose key employees of
acquired companies or alliance businesses.
THE DISCONTINUATION OF FEDERAL PROGRAMS THAT PURCHASE LOANS OR ANY CHANGE IN OUR
ELIGIBILITY TO PARTICIPATE IN SUCH PROGRAMS WOULD HAVE A MATERIAL ADVERSE EFFECT
ON OUR BUSINESS.
If the mortgage programs administered by Fannie Mae, Freddie Mac and Ginnie
Mae or our eligibility to participate in them, were terminated or significantly
curtailed, our business, results of operations and financial condition would be
materially adversely affected. We fund our mortgage loan operations in part by
selling the mortgage loans that we fund to these mortgage programs which pool
the loans into mortgage-backed securities. Our ability to sell mortgage loans
depends upon the continuation of programs administered by these entities, as
well as our continued eligibility to participate in these programs.
We also depend upon private mortgage investors, such as GMAC/RFC, GE Capital
Mortgage and IndyMac, to purchase mortgage loans that we originate which do not
qualify for inclusion in the federal programs described above. If private
investors reduce their purchases of these mortgage loans, the market and price
for such mortgage loans will be adversely affected, which would have a material
adverse effect on our business, results of operations and financial condition.
We depend on automated underwriting and other services offered by government
sponsored and other mortgage investors, including Fannie Mae's Desktop
Underwriter, Freddie Mac's Loan Prospector, GMAC/RFC's AssetWise and GE Capital
Mortgage's Good Decisions. These services help ensure that our mortgage services
can be offered efficiently and timely. We currently have an agreement with
Fannie Mae that allows us to use their automated underwriting services and
enables us to sell them qualified first mortgages. We expect to continue to
process a significant portion of our conforming loans using the Fannie Mae
system. However, our agreements with Fannie Mae and other mortgage investors can
be terminated by either party at any time. There is a risk that we will not
remain in good standing with Fannie Mae and other mortgage investors or that
Fannie Mae and other mortgage investors will terminate our relationship. The
termination of our agreement with Fannie Mae would materially adversely impact
our ability to originate loans.
WE MAY INCUR ADDITIONAL LOSSES FROM THE DISCONTINUED BUSINESSES OF COASTAL
FEDERAL MORTGAGE AND MICAL MORTGAGE.
In April 1998, we acquired Coastal Federal Mortgage, and in May 1998, we
acquired Mical Mortgage Inc. Our results of operations include net losses from
the acquisitions of both of these units
9
<PAGE>
and from their operating activities. Although these business units were
discontinued in April 1999, they may incur additional losses, which would be
included in our consolidated results. We reported net losses associated with
Coastal and Mical for the eight months ended December 31, 1999 and for three
months ended March 31, 2000 of $16.9 million and $500,000, respectively.
IF OUR QUARTERLY REVENUES AND OPERATING RESULTS FLUCTUATE SIGNIFICANTLY, THE
PRICE OF OUR COMMON STOCK IS LIKELY TO BE VOLATILE.
Our quarterly revenues and operating results are likely to continue to vary
substantially from quarter to quarter due to a number of factors, including the
following:
- fluctuations in interest rates;
- seasonal or other economic factors affecting demand for mortgages;
- changes in our pricing policies or our competitors' pricing policies for
mortgage origination and processing fees;
- the introduction of new products and services by us or our competitors;
- the level of consumer interest and confidence in the Internet as a means
of accessing financial products and services;
- any termination or restructuring of agreements with key service providers;
and
- technical difficulties or service interruptions affecting our Internet
websites or operational data processing systems.
Fluctuation in our quarterly results may cause the price of our common stock
to be volatile.
We anticipate that as the on-line mortgage origination industry matures, our
business will also be increasingly susceptible to the same seasonal and cyclical
factors that affect the mortgage industry as a whole. Accordingly, we believe
period-to-period comparisons of our operating results are not meaningful and our
results for any period should not be relied upon as an indication of future
performance. Our operating results may fail to meet our expectations or those of
analysts who follow us. Any such failure could cause our stock price to decline
substantially.
OUR STOCK PRICE COULD BE HIGHLY VOLATILE.
The trading prices of Internet and e-commerce stocks have recently
experienced extreme price and volume fluctuations. These fluctuations often
appear to be unrelated or disproportionate to the operating performance of
Internet and e-commerce companies. The valuations of many Internet and e-
commerce stocks are extraordinarily high based on conventional valuation
standards such as price-to-earnings and price-to-sales ratios. These trading
prices and valuations may not be sustained. Any negative change in the public's
perception of the prospects of Internet or e-commerce companies could further
depress our stock price regardless of our future results. In the past,
securities class action litigation often has been brought against companies
following declines in the market price of their securities. If litigation of
this type were brought against us, it could be very costly and could divert
management's attention and resources from our business.
IF THERE ARE INTERRUPTIONS OR DELAYS IN OBTAINING APPRAISAL, CREDIT REPORTING,
TITLE SEARCHES AND OTHER UNDERWRITING SERVICES FROM THIRD PARTIES, WE MAY
EXPERIENCE CUSTOMER DISSATISFACTION AND DIFFICULTIES CLOSING LOANS.
If we are unsuccessful in securing the timely delivery of ancillary services
such as appraisals, credit reporting and title searches, we will likely
experience increased customer dissatisfaction, and our business, results of
operations and financial condition could be materially adversely affected. We
rely on
10
<PAGE>
other companies to perform certain aspects of the loan underwriting process,
including appraisals, credit reporting and title searches. If the provision of
these ancillary services were interrupted or delayed, it could cause delays in
the processing and closing of loans for our customers. The value of the service
we offer and the ultimate success of our business are dependent on our ability
to secure the timely provision of these ancillary services by the third parties
with whom we have business relationships.
IF WE FAIL TO COMPLY WITH EXTENSIVE FEDERAL AND STATE LAWS REGULATING OUR
INDUSTRY, WE COULD BE SUBJECT TO PENALTIES, DISQUALIFICATIONS, LAWSUITS OR
ENFORCEMENT ACTIONS THAT COULD HAVE A MATERIAL ADVERSE AFFECT OUR BUSINESS.
Our operations are subject to extensive regulation by federal and state
authorities. If we fail to comply with such regulations, possible consequences
could include loss of approved status, demands for indemnification, class action
lawsuits, administrative enforcement actions and other civil and criminal
sanctions, and could have a material adverse effect on our business, results of
operations and financial condition. See "Business--Mortgage Banking Regulation,"
at page 19 of our Annual Report on Form 10-K for eight months ended
December 31, 1999.
IF OUR COMPUTER SYSTEMS FAIL, OUR BUSINESS WOULD BE MATERIALLY ADVERSELY
AFFECTED.
Any interruption in the availability of our websites, transaction-processing
systems or network infracture could materially adversely affect our business,
results of operations and financial condition. Such interruptions could result
from events such as fires, floods, earthquakes, power losses, telecommunications
failures, computer viruses and electronic breaches. Our insurance policies may
not adequately compensate us for losses that may occur in the event of a failure
of our computer systems or other interruptions in our business.
Our websites must accommodate a high volume of traffic and deliver
frequently updated information, the accuracy and timeliness of which is critical
to our business. In the past, we have experienced periodic system interruptions,
which we believe will continue to occur from time to time. Any substantial
increase in the volume of traffic on our websites will require us to expand and
upgrade further our technology, transaction-processing systems and network
infrastructure. We cannot be sure that we will be able to accurately project the
rate or timing of increases, if any, in the use of our websites or expand and
upgrade our systems and infrastructure to accommodate such increases in a timely
manner. In addition, our users depend on Internet service providers, on-line
service providers and other website operators for access to our websites. Many
of them have experienced significant outages in the past, and could experience
outage delays and other difficulties due to system failures unrelated to our
systems. Moreover, the Internet infrastructure may not be able to support
continued growth in its use. Any of these problems would materially adversely
affect our business, results of operations and financial condition.
IF OUR ELECTRONIC SECURITY DEVICES ARE BREACHED, OUR BUSINESS WOULD BE
MATERIALLY ADVERSELY AFFECTED.
If any compromise in our security devices were to occur, it could have a
material adverse effect on our business, results of operations and financial
condition. The secure transmission of confidential information through
e-commerce is critical to our underwriting process. We rely on certain
encryption and authentication technology licensed from third parties to provide
secure transmission of confidential information, such as consumers' financial
statements. There can be no assurance that advances in computer capabilities,
new discoveries in the field of cryptography, or other events or developments
will not result in a compromise or breach of the algorithms we use to protect
transaction data. We may be required to spend significant capital and other
resources to protect against such security breaches or to alleviate problems
caused by such breaches.
11
<PAGE>
Concerns over the security of transactions conducted on the Internet and the
privacy of users may also inhibit the growth of the Internet generally, and
e-commerce in particular. To the extent that our activities involve the storage
and transmission of proprietary information, such as consumers' financial
statements and profile information, security breaches could damage our
reputation and expose us to a risk of loss or litigation and possible liability.
There can be no assurance that our security measures will prevent security
breaches or that a failure to prevent such security breaches will not have a
material adverse effect on our business, financial condition and results of
operations.
WE DO NOT INTEND TO PAY DIVIDENDS.
We have not paid any dividends on our common stock since fiscal 1997 and we
do not anticipate paying dividends on our common stock in the foreseeable
future.
FORWARD LOOKING STATEMENTS
We have made forward-looking statements in this prospectus that are subject
to risks and uncertainties. Forward-looking statements include information
concerning our possible or assumed future results of operations. Also, when we
use such words as "believe," "expect," "anticipate," "plan," "could," "intend"
or similar expressions, we are making forward-looking statements. You should
note that an investment in our securities involves certain risks and
uncertainties that could affect our future financial results. Our actual results
could differ materially from those anticipated in these forward-looking
statements as a result of certain factors, including those set forth in "Risk
Factors" and elsewhere in this prospectus.
We believe it is important to communicate our expectations to our investors.
However, there may be events in the future that we are not able to predict
accurately or over which we have no control. The risk factors listed above, as
well as any cautionary language in this prospectus, provide examples of risks,
uncertainties and events that may cause our actual results to differ materially
from the expectations we describe in our forward-looking statements. Before you
invest in our common stock, you should be aware that the occurrence of the
events described in these risk factors and elsewhere in this prospectus could
materially and adversely affect our business, results of operations and
financial condition.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares by the
selling stockholders.
12
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth (i) the number of outstanding shares,
including shares issuable within 60 days of July 26, 1999 (prior to the
offering) pursuant to options or warrants, beneficially owned and the percentage
ownership of the selling stockholders prior to the offering, (ii) the aggregate
number of shares offered by each such stockholder pursuant to this prospectus
and (iii) the number of shares beneficially owned by each selling stockholder
and the percentage ownership assuming the sale of all of the shares offered by
each such stockholder pursuant to this prospectus.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
878 Corp....................... 317,500 15,875 * 333,375 -- *
Albuquerque D'Orey, Monica..... 500,000 -- * 500,000 -- *
Amorim, Americo................ 7,000,000 1,000,000 8.8 8,000,000(1) -- *
Anasazi Partners............... 50,000 30,000 * 80,000(2) -- *
Andrasko, Gary................. 50,000 2,500 * 52,500 -- *
Archery Capital................ 225,000 -- * 225,000 -- *
Ascuitto, Basil................ -- 15,802 * 15,802 -- *
Baker, Christopher P........... 30,000 -- * 30,000 -- *
Banco del Gottardo............. 500,000 -- * 500,000 -- *
Banco Espirito Santo de
Investimento................. 9,230,933 1,949,867 12.1 11,180,800(3) -- *
Banco Provado Portuges......... 3,333,334 -- 3.7 3,333,334 -- *
Bank Morgan Stanley AG......... 614,138 -- * 614,138 -- *
Becker, John P................. 25,000 -- * 25,000 -- *
Beglin, Francis................ 70,000 3,500 * 73,500 -- *
Bing, Arthur G.H. M.D., IRA
Rollover..................... -- 500 * 500 -- *
Bing, Arthur Ray............... 10,000 -- * 10,000 -- *
Bloch, Raymond................. 25,000 1,250 * 26,250 -- *
Blume, Shirley................. 2,000 100 * 2,100 -- *
Brockton Corporation........... 300,000 -- * 300,000 -- *
Borror, Douglas................ 80,000 4,000 * 84,000 -- *
Bridlespur Partners L.P........ 75,000 3,750 * 78,750 -- *
BRM IND. Inc. Employee Profit
Plan......................... -- 2,500 * 2,500 -- *
Brown, Ralph L. Jr. and Louise
E.L.......................... 10,000 17,500 * 27,500 -- *
Brunton, Colin................. 2,000 -- * 2,000 -- *
Brunton, Craig................. 12,000 600 * 12,600 -- *
Brunton, Craig C/F Colin
Andrew....................... -- 100 * 100 -- *
Brunton, Craig C/F Eric
Maxwell...................... -- 100 * 100 -- *
Brunton, Craig C/F Laura Lee
Brunton...................... -- 100 * 100 -- *
Brunton, Eric.................. 2,000 -- * 2,000 -- *
Brunton, Howard................ 10,000 500 * 10,500 -- *
Brunton, Laura................. 2,000 -- * 2,000 -- *
</TABLE>
13
<PAGE>
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
Brunton, Patricia.............. 5,000 250 * 5,250 -- *
Brunton, Ronald................ 10,000 500 * 10,500 -- *
Bull, Belinda Breese........... -- 5,000 * 5,000 -- *
Caires, Claudia................ 4,000 -- * 4,000 -- *
Chapekis, Anthony.............. 20,000 1,000 * 21,000 -- *
Clemens, John Barry............ 30,000 -- * 30,000 -- *
Codsall Corporation Gestar,
S.A.......................... 3,333,333 -- 3.7 3,333,333 -- *
Cohen, Gerald M................ 525,000 -- * 525,000 -- *
Cohen, Stephen R............... 537,500 -- * 537,500 -- *
Commonwealth Associates........ -- 502,381 * 502,381 -- *
Conners, James................. 15,000 750 * 15,750 -- *
Conway, Lori................... 5,000 250 * 5,250 -- *
Costine Management Co./401K
Profit Sharing
F/B/O David C. Costine....... 2,500 -- * 2,500 -- *
Costine Management Co./401K
Profit F/B/O
Stephen Puricelli............ 1,250 -- * 1,250 -- *
Cumberland Associates LLC...... 6,174,626 -- 6.8 5,008,761(4) 1,165,865 1.3
D'Orey Capucho, Manuel......... 100,000 -- * 100,000 -- *
da Silva Violante, Manuel
Luis......................... 416,666 -- * 416,666 -- *
Dahlen, Richard G.............. 50,000 -- * 50,000 -- *
Danielli, Mark................. -- 1,975 * 1,975 -- *
Davis, Timothy................. -- 14,999 * 14,999 -- *
de Almeida, Miguel Ferreirra... 432,000 -- * 432,000 -- *
de Muralt, Andre............... 25,000 -- * 25,000 -- *
Dell, Samuel M. & Geraline M... 2,500 -- * 2,500 -- *
DeLoach, Lisa.................. -- 5,889 * 5,889 -- *
Dickett, Peter................. 10,000 500 * 10,500 -- *
Eckersley, Jay................. 15,000 750 * 15,750 -- *
Ecklin, Loretta................ 10,000 -- * 10,000 -- *
Ecklin, Robert L............... 2,500 -- * 2,500 -- *
Eldridge, Cornelia F........... 12,500 677,827 * 690,327(5) -- *
Falk, Michael S................ -- 74,252 * 74,252 -- *
Farida, Jalal.................. 10,000 -- * 10,000 -- *
Felcourt Corporation........... 2,570,694 -- 2.8 2,570,694 -- *
Ferreira Martins, Filipa....... 800,000 -- * 800,000 -- *
Ferriera Martins, Jose Diogo... 670,000 -- * 670,000 -- *
Filderman, Robert.............. -- 2,500 * 2,500 -- *
Fisher, David.................. 5,000 250 * 5,250 -- *
Frank Elliott M.D.............. -- 5,000 * 5,000 -- *
Frank Elliott M.D. Trustee..... -- 5,000 * 5,000 -- *
Frishwasser, Daniel............ 35,000 -- * 35,000 -- *
Fulton, Peter.................. -- 1,001 * 1,001 -- *
</TABLE>
14
<PAGE>
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
Fundo Pensoes Banco Pinto &
Sotto Mayor.................. 1,000,000 -- 1.1 1,000,000 -- *
Fundo Pensoes Banco Totta &
Acores....................... 333,333 -- * 333,333 -- *
Fundo Pensoes Credito Predial
Portugues.................... 283,333 -- * 283,333 -- *
Fundoacao Luso American para o
Desenvolvimento.............. 1,000,000 -- 1.1 1,000,000 -- *
Garcao, Jose Maria Salema...... 3,140,000 6,190,000 9.7 9,290,000 40,000 *
Gasaway, James................. 25,000 1,250 * 26,250 -- *
Gharib, Mary................... 5,000 -- * 5,000 -- *
Giardina, Anthony.............. -- 5,925 * 5,925 -- *
Gistaro, Joseph E., TTEE....... 138,106 -- * 138,106 -- *
Gotschall, Troy A.............. -- 8,333 * 8,333 -- *
Grady, Patrick................. 2,000 100 * 2,100 -- *
Greenwich Fine Arts............ 5,000 -- * 5,000 -- *
Griffin, Greg.................. -- 5,000 * 5,000 -- *
H.P. Griffo Inc. Retirement
Trust........................ 2,500 -- * 2,500 -- *
Guedes Q. de Mendia, Eduardo... 250,000 -- * 250,000 -- *
Guedes, Jose Philipe........... 320,000 200,000 * 520,000 -- *
Guilani, S.M. Izadi............ 5,000 -- * 5,000 -- *
Haag, Bernadette--IRA.......... 5,000 -- * 5,000 -- *
Haag, Andrew................... -- 26,500 * 26,500 -- *
Haag, Robert................... -- 26,500 * 26,500 -- *
Handy, Jane Meredith........... -- 1,250 * 1,250 -- *
Hedrington Investments SA...... 1,666,667 -- 1.9 1,666,667 -- *
Henney, Regina Tee............. 20,000 1,000 * 21,000 -- *
Herr, Jeffrey D................ -- 8,333 * 8,333 -- *
Herring, Jack.................. 50,000 2,500 * 52,500 -- *
Hoffman, Susan................. -- 1,000 * 1,000 -- *
Horowitz, Carol................ 1,001 -- * 1,001 -- *
House, Jeff.................... 5,000 250 * 5,250 -- *
Hubbard, Richard--IRA.......... -- 21,250 * 21,250 -- *
Hughes, R. Gerald.............. -- 5,000 * 5,000 -- *
Ickert, Heinz.................. 5,000 250 * 5,250 -- *
Izadi, Mohammed A.--IRA........ 10,000 -- * 10,000 -- *
J.F. Shea Co., Inc. as Nominee
1997-24...................... -- 250,000 * 250,000 -- *
J.P. Carey Securities, Inc..... -- 30,000 * 30,000 -- *
Jacoby, Richard A.............. 25,000 -- * 25,000 -- *
Johnson, Thomas B.............. 80,000 4,000 * 84,000 -- *
Jumaluddin Family Trust........ -- 5,000 * 5,000 -- *
Juventus Investments S.A....... -- 20,000 * 20,000 -- *
Kafai, Bijan................... -- 5,000 * 5,000 -- *
Kahla, Pierre.................. 76,000 -- * 76,000 -- *
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
Kamm, Robert M................. -- 16,667 * 16,667 -- *
Karl, George................... 50,000 2,500 * 52,500 -- *
Timothy M. Kelley, Trustee U/A/
D 12/23/86................... 17,500 875 * 18,375 -- *
Kemp, Kenneth.................. 20,000 1,000 * 21,000 -- *
Kemp, Kevin.................... 80,000 4,000 * 84,000 -- *
Kiehl, Sam..................... 500,000 25,000 * 525,000 -- *
Kozersky, David................ 20,000 1,000 * 21,000 -- *
Labarbara, Stephen............. -- 1,975 * 1,975 -- *
Lauresen, Niels................ 20,000 -- * 20,000 -- *
Leitman, Jerry D............... 5,000 -- * 5,000 -- *
Leppla, Craig.................. -- 1,975 * 1,975 -- *
Letticri, Lisa................. -- 3,095 * 3,095 -- *
Levesque, Carla S.............. 19,375 -- * 19,375 -- *
Lewis, Ellwood................. 25,000 1,250 * 26,250 -- *
Lighthouse Investment Partners,
L.P.......................... 599,189 -- * 599,189(6) -- *
Linn, John..................... 15,000 750 * 15,750 -- *
Lipman, Beth................... -- 500 * 500 -- *
Liput, Andrew L................ 25,000 -- * 25,000 -- *
Lopera, Juan................... -- 2,002 * 2,002 -- *
Lotterman, Thomas H............ -- 1,250 * 1,250 -- *
Lubbers, Kristine.............. 15,000 750 * 15,750 -- *
Lubbers, Lawrence & Pamela..... 325,000 1,250 * 26,250 300,000 *
Lubbers, Melissa............... 15,000 750 * 15,750 -- *
Lubbers, Thomas Barton......... 15,000 750 * 15,750 -- *
Lubin TTEE, Harve L............ 207,162 -- * 207,162 -- *
Luntz, John.................... 5,000 250 * 5,250 -- *
M. Fund Dollar Growth.......... -- 35,000 * 35,000 -- *
Mague, SGPA, S.A............... 1,666,667 -- 1.8 1,666,667 -- *
Malmuth, D. Allen.............. -- 10,000 * 10,000 -- *
Marandi, Mohammad.............. 5,000 250 * 5,250 -- *
Mayer, Charles D............... 5,000 -- * 5,000 -- *
Mayer, Frank................... 5,000 -- * 5,000 -- *
MC Geste--Sociedade Gestora de
Patrimonios SA............... 50,000 -- * 50,000 -- *
McAdams, Kenneth............... -- 2,500 * 2,500 -- *
Meyer, S. Lewis................ -- 1,165,000 1.3 1,700,000 65,000
MicroSearch Investments, LLC... -- 125,000 * 125,000 -- *
Miller, Luke................... 5,000 -- * 5,000 -- *
Molnar, Anthony................ 20,000 1,000 * 21,000 -- *
Moschetta, Ronald.............. -- 3,950 * 3,950 -- *
Mulkey, David A................ 50,000 -- * 50,000 -- *
Munsell, James................. -- 5,000 * 5,000 -- *
</TABLE>
16
<PAGE>
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
Nano-Cap Hyper Growth
Partnership.................. 25,000 -- * 25,000 -- *
Nass, Robert................... -- 1,975 * 1,975 -- *
Nathan, Milton................. 30,000 1,500 * 31,500 -- *
Noack, James W................. 35,343 75,001 * 110,344 -- *
O'Sullivan, Robert............. -- 8,950 * 8,950 -- *
Osborne, Ron and Barbara....... -- 5,000 * 5,000 -- *
Ozada, Enrich R. (IRA)......... 51,413 -- * 51,413 -- *
Panosian, Manuel............... -- 5,000 * 5,000 -- *
Penniston, Eric W. Jr.......... -- 35,000 * 35,000(7) -- *
Perreira, Richard.............. -- 500 * 500 -- *
Perrini, John.................. 10,000 500 * 10,500 -- *
Perrini, Michael............... 33,500 1,675 * 35,175 -- *
Pharos Fund Limited............ 1,277,672 -- 1.4 1,277,672 -- *
Pimentel, Mary................. -- 8,333 * 8,333 -- *
Pinkert, Philip................ -- 19,939 * 19,939 -- *
Piper Jaffray.................. -- 491,143 * 491,143 -- *
Politzer, David................ 100,000 -- * 100,000 -- *
Purvis, David.................. 5,000 -- * 5,000 -- *
Railey, John E., TTEE.......... 45,173 -- * 45,173 -- *
Rand, Eric..................... -- 3,950 * 3,950 -- *
Rawitch, L. Daniel............. 624,873 733,333 1.5 400,000 958,206 1.1
Redman, Ken.................... 5,000 250 * 5,250 -- *
Reese, Olivia Tam.............. 21,474 -- * 21,474 -- *
Rice, Howard................... 187,500 -- * 187,500 -- *
Rinaldi Balbi, Armando Jose.... 560,000 -- * 560,000 -- *
Robertson, T. Calloway......... 3,000 150 * 3,150 -- *
Rockman, Robert................ -- 2,500 * 2,500 -- *
Rose, Wilbur R................. 15,000 750 * 15,750 -- *
Rosenbloom, Keith.............. -- 9,400 * 9,400 -- *
Rubenstein, Eric............... -- 3,950 * 3,950 -- *
SAC Corporation................ 3,000,000 -- 3.3 3,000,000 -- *
Satelitte...................... 666,667 -- * 666,667 -- *
Savage, Elizabeth.............. -- 1,250 * 1,250 -- *
Schechter, David............... 300,000 175,000 * 475,000 -- *
Scheidker, Audrey.............. 1,250 -- * 1,250 -- *
Schlonsky, Gertrude............ 20,000 1,000 * 21,000 -- *
Schlonsky, Joe................. 50,000 2,500 * 52,500 -- *
Schueller, Gerald.............. 5,000 250 * 5,250 -- *
Scritchfield, George........... -- 100,000 * 100,000 -- *
Sekreta, Gregory E............. 15,000 750 * 15,750 -- *
</TABLE>
17
<PAGE>
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
Serras, Luis Jorge............. 700,000 -- * 700,000 -- *
Seton Services, Inc............ -- 25,000 * 25,000 -- *
Siemer, Barb................... 100,000 5,000 * 105,000 -- *
Sigla Corporation.............. 200,000 -- * 200,000 -- *
Skilondz, Theodore & Jan....... 5,000 250 * 5,250 -- *
Sleeper, Mitchell J............ 28,500 35,000 * 63,500 -- *
Snearey, Thomas................ 5,000 250 * 5,250 -- *
Soares Franco, Filipe.......... 180,000 -- * 180,000 -- *
Societe Bancaire de Paris SA... 416,667 -- * 416,667 -- *
Sogema, SGPS, S.A.............. 897,600 -- * 897,600 -- *
Spence, Lee H.................. -- 5,000 * 5,000 -- *
Springer, M. H................. -- 54,733 * 54,733 -- *
Spynola Teixeira, Carlos....... 260,000 -- * 260,000 -- *
Stein, David................... -- 1,001 * 1,001 -- *
Stein, Stephan................. -- 2,500 * 2,500 -- *
Steitz, Timothy................ 250,000 12,500 * 262,500 -- *
Sterios, Paul.................. 25,000 1,001 * 26,001 -- *
Staid, James J................. 2,500 11,250 * 13,750 -- *
Straughen, William J........... 35,000 1,750 * 36,750 -- *
Tallur, Inder.................. -- 5,500 * 5,500 -- *
Teneff, Hobart................. 10,000 -- * 10,000 -- *
Thomson & Kernaghan & Co.,
Ltd.......................... 1,270,000 1,127,500 2.7 2,397,500 -- *
Thorsen, Marianne.............. -- 7,500 * 7,500 -- *
Tobin, Raymond G. and Rose..... -- 5,000 * 5,000 -- *
Toombs, Walter F............... 50,000 -- * 50,000 -- *
Tracewell, Andrew C............ 5,000 250 * 5,250 -- *
Tracewell, Larry............... 35,000 1,750 * 36,750 -- *
Tracewell, Matthew S........... 5,000 250 * 5,250 -- *
Value Investing Partners....... -- 16,802 * 16,802 -- --
Van Siclen, Bradford........... -- 10,500 * 10,500 -- *
Volpe, Michael................. -- 1,975 * 1,975 -- *
Wallace, David & Katy.......... -- 10,000 * 10,000 -- *
Weiler, Steve.................. 50,000 2,500 * 52,500 -- *
Weisbrod, Jay A................ 8,333 8,333 * 16,666 -- *
Weyl, Steve.................... 20,000 1,000 * 21,000 -- *
Winkel, George................. 25,000 -- * 25,000 -- *
Winston, Lawrence J.--IRA...... 5,000 -- * 5,000 -- *
Woodworth, George H. Jr. and
Margaret O................... -- 150,000 * 150,000 -- *
</TABLE>
18
<PAGE>
<TABLE>
<CAPTION>
SHARES BENEFICIALLY OWNED
PRIOR TO OFFERING
----------------------------------------
NUMBER OF
NUMBER SHARES ISSUABLE SHARES BENEFICIALLY
OF WITHIN 60 DAYS SHARES OWNED AFTER OFFERING
OUTSTANDING OF OFFERED --------------------
NAME SHARES JULY 26, 1999 PERCENT IN OFFERING NUMBER PERCENT
------------------------------- ----------- --------------- -------- ----------- --------- --------
% %
<S> <C> <C> <C> <C> <C> <C>
Wynne, Joseph P................ -- 15,802 * 15,802 -- *
Zihnali, Balkir................ 25,000 -- * 25,000 -- *
TOTAL.......................... 62,245,262 15,791,794 73.5% 76,107,995 2,529,071 2.8%
</TABLE>
------------------------
* Less than 1%
(1) Includes 5,000,000 held by Fondation Pamalu, a foundation of which
Mr. Amorim is the beneficiary, and 1,000,000 shares subject to currently
exercisable warrants held by Fondation Pamalu.
(2) Includes 30,000 shares subject to warrants held by Anasazi Marketing Group.
(3) Includes the security holdings of the entities listed below, all of which
are affiliated with Banco Espirito Santo de Investimento:
<TABLE>
<CAPTION>
NUMBER OF
OUTSTANDING
ENTITY SHARES
------------------------------------------------------------ -----------
<S> <C>
Banco Espirito Santo........................................ 2,442,159
Espirito Santo Dealer, S.A.................................. 871,893
Espirito Santo Financial Group, S.A......................... 514,139
Espirito Santo Fundo de Pensoes, S.A........................ 2,666,666
</TABLE>
(4) Includes shares held by the individuals and entitities listed below, each of
which is affiliated with Cumberland Associates:
<TABLE>
<CAPTION>
NUMBER
OF OUTSTANDING
ENTITY OR INDIVIDUAL SHARES
------------------------------------------------------------ --------------
<S> <C>
Cumber International........................................ 185,000
Cumberland Partners......................................... 4,419,380
C-Valor LTD................................................. 175,000
Cox, Edwin L................................................ 70,000
Delta Associates, LP........................................ 85,000
Long View Partners.......................................... 578,469
Long View Partners B, LP.................................... 423,517
Long View Partners C, LP.................................... 148,260
Schaefer, Charles V......................................... 90,000
</TABLE>
(5) Includes 21,183 shares subject to currently exercisable warrants held by the
Eldridge Family Partnership, Ltd., 12,500 shares held by the Cornelia F.
Eldridge IRA and 7,500 shares subject to currently exercisable warrants held
by the Cornelia F. Eldridge IRA.
(6) Includes 367,859 shares held by Lighthouse Partners USA, L.P.
(7) Includes 25,000 shares subject to currently exercisable warrants jointly
held by Deborah Penniston and Eric W. Penniston, Jr.
19
<PAGE>
PLAN OF DISTRIBUTION
The selling stockholders may offer their shares at various times in one or
more of the following transactions:
- on the Nasdaq SmallCap Market (or any other exchange on which the shares
may be listed);
- in the over-the-counter market;
- in negotiated transactions other than on such exchanges;
- by pledge to secure debts and other obligations;
- in connection with the writing of non-traded and exchange-traded call
options, in hedge transactions, in covering previously established short
positions and in settlement of other transactions in standardized or
over-the-counter options; or
- in a combination of any of the above transactions.
The selling stockholders may sell their shares at market prices prevailing
at the time of sale, at prices related to such prevailing market prices, at
negotiated prices or at fixed prices. The selling stockholders may use
broker-dealers to sell their shares. The broker-dealers will either receive
discounts or commissions from the selling stockholders, or they will receive
commissions from purchasers of shares.
Under certain circumstances the selling stockholders and any broker-dealers
that participate in the distribution may be deemed to be "underwriters" within
the meaning of the Securities Act. Any commissions received by such
broker-dealers and any profits realized on the resale of shares by them may be
considered underwriting discounts and commissions under the Securities Act. The
selling stockholders may agree to indemnify such broker-dealers against certain
liabilities, including liabilities under the Securities Act.
Under the rules and regulations of the Exchange Act, any person engaged in
the distribution or the resale of shares may not simultaneously engage in market
making activities with respect to FiNet.com's common stock for a period of two
business days prior to the commencement of such distribution. The selling
stockholders will also be subject to applicable provisions of the Exchange Act
and regulations under the Exchange Act which may limit the timing of purchases
and sales of shares of FiNet.com's common stock by the selling stockholder.
The selling stockholders will pay all commissions, transfer taxes, and other
expenses associated with the sale of securities by them. The shares offered
hereby are being registered pursuant to contractual obligations of FiNet.com,
and FiNet.com has paid the expenses of the preparation of this prospectus. We
have not made any underwriting arrangements with respect to the sale of shares
offered hereby.
LEGAL MATTERS
The validity of the common stock offered hereby will be passed on for us by
Severson & Werson, San Francisco, California, counsel to the company in
connection with the offering.
EXPERTS
The consolidated financial statements of FiNet.com appearing in FiNet.com's
Annual Report (Form 10-K) for the eight months ended December 31, 1999 and for
the year ended April 30, 1999 have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report therein and incorporated
herein by reference. Such consolidated financial statements are incorporated
herein
20
<PAGE>
by reference in reliance upon such report given upon the authority of such firm
as experts in accounting and auditing.
FiNet.com's consolidated financial statements, except with respect to
Coastal Federal Mortgage, for the fiscal years ended April 30, 1998 and 1997
were audited by Reuben E. Price & Co., independent certified accountants, as set
forth in their report therein and incorporated herein by reference. Such
financial statements are incorporated herein by reference in reliance upon such
report given upon the authority of such firm as experts in accounting and
auditing.
The financial statements of Coastal Federal Mortgage, for the fiscal year
ended April 30, 1998, which are not presented separately herein, were audited by
Richard A. Eisner & Company, LLP, independent auditors, as set forth in their
report thereon and incorporated herein by reference. Such financial statements
are incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly, and current reports, proxy statements, and other
documents with the Securities and Exchange Commission. You may read and copy any
document we file at the SEC's public reference room at Judiciary Plaza Building,
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. You should call
1-800-SEC-0330 for more information on the public reference room. The SEC
maintains an Internet site at http://www.sec.gov where certain information
regarding issuers (including FiNet.com) may be found.
This prospectus is part of a registration statement that we filed with the
SEC (Registration No. 333-82217). The registration statement contains more
information than this prospectus regarding FiNet.com and its common stock,
including certain exhibits and schedules. You can get a copy of the registration
statement from the SEC at the address listed above or from its Internet site.
21
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by the registrant in connection
with the sale of the common stock being registered. All amounts are estimated
except the SEC registration fee.
<TABLE>
<CAPTION>
<S> <C>
SEC Registration Fee........................................ $ 91,610
Accounting Fees and Expenses................................ $ 160,000
Legal Fees and Expenses..................................... $ 310,000
Printing and Engraving...................................... $ 20,000
Miscellaneous............................................... $ 3,390
-------------------------
Total................................................... $ 585,000
=========================
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pursuant to the General Corporation Law of Delaware (the "DGCL"), the
registrant's Certificate of Incorporation excludes personal liability on the
part of its directors to the registrant for monetary damages based upon any
violation of their fiduciary duties as directors, except as to liability for any
breach of the duty of loyalty, acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, acts in violation
of Section 174 of the General Corporation Law of Delaware, or any transaction
from which a director receives an improper personal benefit. This exclusion of
liability does not limit any right which a director may have to be indemnified.
The registrant's Certificate of Incorporation and its Bylaws require
indemnification of directors and officers of the registrant to the fullest
extent permitted by the DGCL for claims against them in their official
capacities, including stockholders' derivative actions.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the SEC, such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
--------------------- -----------
<C> <S>
5.1* Opinion of Severson & Werson
23.1 Consent of Ernst & Young LLP
23.2 Consent of Reuben E. Price & Co.
23.3 Consent of Richard A. Eisner & Company, LLP
23.4 Consent of Severson & Werson (included in Exhibit 5.1
hereto)
*24.1 Power of Attorney (see page II-4)
</TABLE>
------------------------
* Previously filed.
ITEM 17. UNDERTAKINGS
A. The undersigned registrant hereby undertakes:
II-1
<PAGE>
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933, as amended;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the Registration Statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the SEC
pursuant to Rule 424(b) if, in the aggregate, the changes in the volume
and price represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of the Registration Fee"
table in the effective Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
B. Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions described in Item 14 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
C. The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of
this registration statement as of the time it was declared effective.
(2) For purposes of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
II-2
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Post-effective
Amendment No.1 to Registration Statement on Form S-3 to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of San Ramon,
California on August 1, 2000.
<TABLE>
<S> <C> <C>
FINET.COM, INC.
By: /s/ GARY A. PALMER
-----------------------------------------
Gary A. Palmer
EXECUTIVE VICE PRESIDENT--
CHIEF FINANCIAL OFFICER
</TABLE>
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Gary A.
Palmer his true and lawful attorneys-in-fact and agents, each acting alone, with
full power of substitution and resubstitution, for him and in his name, place
and stead, in any and all capacities, to sign any or all amendments (including
post-effective amendments) to the Registration Statement, and to sign any
registration statement for the same offering covered by this Registration
Statement that is to be effective upon filing pursuant to Rule 462(b) under the
Securities Act of 1933, as amended, and all post-effective amendments thereto,
and to file the same, with all exhibits thereto, and all documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, 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 he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, each acting alone, or his substitute or substitutes, may lawfully do or
cause to be done by virture hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Post-effective Amendment No.1 to Registration Statement on Form S-3 has been
signed by the following persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE OFFICE DATE
--------- ------ ----
<C> <S> <C>
Chief Executive
/s/ RICK COSSANO Officer and Director August 1, 2000
--------------------------------- (Principal Executive Officer)
Rick Cossano
* Vice Chairman August 1, 2000
---------------------------------
L. Daniel Rawitch
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE OFFICE DATE
--------- ------ ----
<C> <S> <C>
Executive Vice President--
/s/ GARY A. PALMER Chief Financial Officer August 1, 2000
--------------------------------- (Principal Financial and
Gary A. Palmer Accounting Officer)
* Director August 1, 2000
---------------------------------
Antonio P. Falcao
* Director August 1, 2000
---------------------------------
S. Lewis Meyer
* Director August 1, 2000
---------------------------------
Stephen J. Sogin, Ph.D.
* Director August 1, 2000
---------------------------------
Richard E. Wilkes
</TABLE>
<TABLE>
<S> <C> <C> <C>
*By: /s/ GARY A. PALMER
--------------------------------------
Gary A. Palmer
(ATTORNEY-IN-FACT)
</TABLE>
II-5
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
--------------------- -----------
<C> <S>
5.1* Opinion of Severson & Werson
23.1 Consent of Ernst & Young LLP
23.2 Consent of Reuben E. Price & Co.
23.3 Consent of Richard A. Eisner & Company, LLP
23.4* Consent of Severson & Werson (included in Exhibit 5.1
hereto)
*24.1 Power of Attorney (see page II-4)
</TABLE>
------------------------
* Previously filed.
II-5
