<PAGE>
As Filed with the Securities and Exchange Commission on October 26, 2000
Registration No. 333-_______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Osage Systems Group, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 95-4374983
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification Number)
1661 East Camelback Road, Suite 245
Phoenix, Arizona 85016
(602) 274-1299
(Address, including zip code, and telephone
number, including area code, of Registrant's
principal executive offices)
PHIL CARTER
Chief Executive Officer
Osage Systems Group, Inc.
1661 East Camelback Road, Suite 245
Phoenix, Arizona 85016
(602) 274-1299
Fax: (602) 274-9154
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to:
JOSEPH P. GALDA, ESQ.
Buchanan Ingersoll Professional Corporation
Eleven Penn Center
1835 Market Street, 14th Floor
Philadelphia, Pennsylvania 19103
(215) 665-3879
Fax: (215) 665-8760
Approximate date of commencement of proposed sale to the public: From time to
time after this Registration Statement becomes effective.
----------------------------------
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, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule
462(d) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
<PAGE>
<TABLE>
<CAPTION>
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CALCULATION OF REGISTRATION FEE
----------------------------------------------------------------------------------------------------------------------
Proposed Proposed
Amount Maximum Maximum Amount Of
Title of shares To Be Aggregate Price Aggregate Registration
To Be Registered Registered Per Share(1) Offering Price Fee
----------------------------- ------------------ ----------------------- ---------------------- ----------------------
<S> <C> <C> <C> <C>
Common stock,
$.01 par value............ 7,142,825 (2) $0.59375 $4,241,052 $1,120
----------------------------- ------------------ ----------------------- ---------------------- ----------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c). The price represents the average of the high and
low prices per share of common stock of Osage Systems Group, Inc. as
reported on The American Stock Exchange on October 24, 2000.
(2) Consists of the following:
o 182,825 common shares issued to certain employees pursuant to
certain earn-out and bonus provisions in connection with our prior
acquisitions;
o 1,335,000 common shares issuable upon exercise of outstanding
warrants and warrants which will be issued upon the effective date
of this registration statement at prices ranging from $1.00 to
$1.50, all of which were issued or will be issued in private
placement transactions; and
o 5,625,000 common shares issuable upon conversion of $2,250,000 of
our outstanding 8% convertible notes and notes which will be
issued upon the effective date of this registration statement, all
of which were issued or will be issued in a private placement
transaction. The notes convert into shares of our common stock at
a price of $0.80 per share, subject to downward adjustment based
on the trading price of our common stock. Because of the potential
downward adjustment, we are contractually obligated to register
not less than 200% of the shares issuable at the $0.80 conversion
price.
We hereby amend this registration statement on such date or dates as
may be necessary to delay its effective date until we 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 the Registration Statement shall become effective on such
date as the SEC, acting pursuant to said Section 8(a), may determine.
<PAGE>
The information in this 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 is effective. This 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.
Subject to completion, dated October 26, 2000
Preliminary Prospectus
----------------------
Osage Systems Group, Inc.
7,142,825 Shares of common stock
The selling security holders, identified on page 10 of this prospectus,
may offer and sell, from time to time, up to 7,142,825 shares of our common
stock, which includes 6,960,000 common shares which may be issued upon the
exercise of warrants and the conversion of notes. The selling security holders
may sell all or some of their respective shares through public or private
transactions, at prevailing market prices, or at privately negotiated prices. We
will not receive any part of the proceeds from sales of these shares, although
we may receive the exercise price of the warrants. The holders of the notes and
warrants are not obligated to convert the notes or exercise the warrants.
Our common stock is listed on The American Stock Exchange under the
symbol "OSE". The last reported sale price of our common stock on October 25,
2000 on The American Stock Exchange was $0.5625 per share.
----------------------------------------
Investing in our common stock involves a high degree of risk. See "Risk
Factors" beginning on page 2.
----------------------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved these securities or determined
if this prospectus is truthful or complete. Any representation to
the contrary is a criminal offense.
The date of this prospectus is [___________]
<PAGE>
Osage Systems Group, Inc.
Table of Contents
-----------------
Page No.
--------
ABOUT THIS PROSPECTUS.........................................................ii
ABOUT OUR BUSINESS.............................................................1
RISK FACTORS...................................................................2
FORWARD-LOOKING STATEMENTS.....................................................8
RECENT DEVELOPMENTS............................................................8
USE OF PROCEEDS................................................................9
SELLING SECURITY HOLDERS.......................................................9
DESCRIPTION OF SECURITIES.....................................................11
PLAN OF DISTRIBUTION..........................................................14
LEGAL MATTERS.................................................................16
EXPERTS.......................................................................16
INDEMNIFICATION OF DIRECTORS AND OFFICERS.....................................16
WHERE YOU CAN FIND MORE INFORMATION...........................................17
i
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About this Prospectus
This prospectus is part of a registration statement we filed with the
SEC. You should rely only on the information or representations provided in this
prospectus. We have not authorized anyone to provide you with different
information. We are not making an offer of these securities in any state where
the offer is not permitted. You should not assume that the information in this
prospectus is accurate as of any date other than the date on the front of the
document.
ii
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About Our Business
We provide products, solutions and services nation-wide to support,
integrate and manage computer network systems. As a total solutions provider, we
sell and integrate hardware, software and technical resources to solve critical
data management problems. We assist our customers in all phases of their
information technology needs. This involves analyzing their business needs,
designing and implementing systems for them and providing ongoing systems
management support. Our technical consultants are skilled in specialized
practice areas such as enterprise infrastructure, enterprise resource planning,
electronic commerce, java application development, web solutions, electronic
publishing and network support services. We provide solutions which integrate
products from industry-leading vendors. In addition, we have developed
proprietary data warehousing and data mining Internet software which we have
begun to offer to the marketplace.
During 1998 and 1999, we implemented a business strategy focusing on
growth through acquisition and development of the higher margin professional
consulting segment of our operations. We acquired six companies that have
significantly contributed to our revenue base since the beginning of 1998.
During 1998, our revenues increased to $61 million from $14.2 million during
1997. If each of the acquisitions had been completed as of January 1, 1998, our
revenues during 1998 would have increased to $83 million. Additionally, in
August 1999, we acquired the business intelligence and data warehousing business
of Leveraged Solutions, Inc. Our total revenues for 1999 were $114.7 million.
During the first half of 2000, we redirected our business strategy by focusing
on developing the professional consulting segment of operations. We recently
reorganized into two strategic business units, Osage iXi and Osage Systems
Integration. Osage iXi provides consulting services to e-commerce businesses
such as designing systems to improve supply chain management and gathering and
analyzing data to improve client performance. Osage System Integration customers
include both our traditional base and the emerging market of Internet related
companies. In 1999 we had in excess of 70 customers whose principal business
related to the Internet such as Internet service providers "ISPs", application
service providers "ASPs", business to business "B2B" commerce sites and business
to consumer "B2C" commerce sites. Most of the services provided to these
customers involve the basic infrastructure of their Internet installations.
We were originally incorporated as "Pacific Rim Entertainment, Inc."
under the laws of Delaware in 1992. After several years of losses, Pacific Rim
suspended operations in 1996. Pacific Rim acquired and assumed the historic
business of Osage Computer Group, Inc. in a merger transaction that became
effective on December 22, 1997. Osage Computer Group, Inc. had been a provider
of network computing solutions since 1989. On March 10, 1998, Pacific Rim
changed its name to "Osage Systems Group, Inc."
Our executive offices are located at 1661 East Camelback Road, Suite
245, Phoenix, Arizona, and our telephone number is (602) 274-1299.
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Risk Factors
An investment in the shares of common stock offered by this prospectus
involves a high degree of risk, and you should invest only after you have
carefully gathered and reviewed information about us. This prospectus has been
filed as part of a registration statement on Form S-3 and only contains a
summary of information which may be relevant to you in making an investment
decision. Accordingly, prior to making an investment decision, you should
carefully evaluate, among other materials, the following risk factors, the
remainder of the information set forth in this prospectus and the reports we
have filed with the SEC, and other information about us incorporated by
reference into this document.
1. If losses continue, our operations will suffer and we will have to
delay or limit our development program. This could hinder our growth in
the computer industry and slow our generation of revenues.
We have recently incurred material losses. If we continue to suffer
material losses, our operations will be adversely affected and we will have to
cease or significantly delay our development strategy. Specifically, we incurred
a net loss of $6.4 million for the year ended December 31, 1999, of which $4.4
million represented restructuring and impairment charges incurred during the
third quarter of 1999. Through the first six months of 2000 we have incurred a
net loss of approximately $2.7 million and have required the influx of
additional capital to support our operations. While we can give no assurances,
we believe that operating losses will subside and operating profits can be
achieved within the next year.
2. Our future profitability depends upon the successful development of
our e-commerce consulting practice.
Our future profitability depends upon our successful implementation of
a business strategy focusing on growth through development of the higher margin
professional consulting segment of our operations, particularly services that
allow businesses to engage in commerce over the Internet. We will need to hire
significant numbers of technical personnel to further develop our higher margin
services. We may not be able to attract and retain those personnel. In addition,
we will invest substantially in the development of our e-commerce consulting
services, but cannot guarantee that those services will be successful in the
marketplace.
3. We will need to secure additional financing or use our cash resources
to pursue our development strategy. Financing our strategy by issuing
securities could lower the value of the shares, while using cash
resources for product development will divert those resources from our
current base business.
During 1998 and 1999, our business grew through acquisitions. Recently
we have refocused on product and service development. We will need additional
financing to develop this strategy. We intend to obtain additional financing
through a combination of traditional debt financing, issuing our shares and
selling debt and equity securities. If we are able to finance our growth by
issuing our securities, we will not need as much additional cash, but the
issuance of securities could dilute our stock, thereby reducing its value. If we
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do not have sufficient cash resources, our growth could be limited unless we are
able to obtain additional capital through debt or equity financing. If we do not
have sufficient cash resources, we may be forced to engage in debt financing on
terms that restrict our ability to make investments in product and service
development and incur additional debt, which could impede our ability to achieve
our growth strategy.
We entered into an agreement on July 21, 2000 with SPH Investments,
Inc., a principal stockholder, and HMA Associates, Inc., pursuant to which we
were to receive $4.0 million in debt financing. Of this financing $2.0 million
was advanced on July 25, 2000, with $1.0 million expected by September 30, 2000.
Pursuant to the agreement the company expects the final $1 million by November
30, 2000. As of the date of this prospectus, the $1 million expected on or
before September 30, 2000 has not been received. We are in discussions with SPH
and HMA regarding the timing of the remaining funds committed to us. Failure to
obtain these funds could have an adverse affect on our ability to meet all of
our obligations on a timely basis.
4. The future issuance of additional shares of common stock could decrease
the value of the shares.
We are presently authorized to issue 100,000,000 shares of common
stock, of which 33,294,462 are outstanding as of the date of this prospectus. As
detailed below, we expect to issue at least 8,187,500 more shares in the future
due to business decisions of our board of directors, in order to meet our
contractual obligations, upon the exercise of options and warrants and upon the
conversion of convertible notes. Issuance of these shares is likely to have a
dilutive effect upon the existing stockholders and may reduce the value of their
investment.
We may issue additional shares for valid business purposes within the
discretion of our board of directors, such as:
o the acquisition of other companies; and
o compensation of our officers, employees and directors.
In addition, we are contractually obligated to issue shares for the
following reasons:
o if holders of our options exercise their rights to purchase shares,
we must issue up to 3,936,076 shares of common stock;
o if holders of our warrants exercise their rights to purchase shares,
we must issue up to 1,590,500 shares of common stock;
o if holders of our convertible notes convert their notes, we must
issue at least 2,812,500 shares of common stock and may have to issue
additional shares of our common stock if the market value of the
common stock declines; and
o we may need to issue shares under the earn-out provisions of our
prior acquisitions if the financial and performance criteria
described in the acquisition agreements are satisfied.
5. Completion of this offering will significantly increase the number of
shares of our common stock that may be sold into the market. This could
cause the market price of our common stock to drop significantly, even
if our business is doing well.
Sales of substantial amounts of common stock in the public market
following this offering could reduce the market price of our common stock and
make it more difficult for us to sell equity securities in the future. As of the
date of this prospectus, approximately 32 million shares of our common stock are
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eligible for resale into the market under applicable securities laws. After this
offering, the 7,142,825 shares covered by this prospectus may be resold into the
public market immediately. This includes approximately 6,960,000 shares that may
be resold upon the exercise of warrants and conversion of notes covered by this
prospectus. Sales of these shares in the public market, or the perception that
future sales of these shares could occur, could have the effect of lowering the
market price of our common stock below current levels.
6. A former preferred stockholder recently sued us. We may be forced to
issue additional shares of our common stock or pay a large amount of
money to the stockholder in the lawsuit. If that happens, our stock may
be diluted and we may not have enough cash to operate our business.
Halifax Fund, L.P., formerly a preferred stockholder of ours, sued us
for allegedly failing to offer Halifax the right to participate in a financing
consummated in November 1999. Halifax is suing for the right to purchase
below-market securities from us, as well as monetary damages. If Halifax is
successful in the lawsuit, we may be forced to issue preferred stock convertible
into approximately 13.3 million shares of our common stock or pay a large sum of
money as damages to Halifax.
7. Our classified board of directors and Delaware statutory provisions
against takeovers may make a change in control of Osage more difficult,
even if a takeover would benefit our stockholders and us. These factors
could prevent our stockholders from recognizing a premium on our stock.
Our board of directors has three classes, with the members of one class
elected each year to serve a three-year term. A director may be removed only for
cause by a vote of the holders of two-thirds of our outstanding securities. The
classified board of directors makes it more difficult to change majority control
of the board, which may discourage attempts by third parties to make a tender
offer or otherwise obtain control of us, even if such attempt would be
beneficial to our stockholders and us.
We are governed by the provisions of Section 203 of the General
Corporation Law of the State of Delaware, an anti-takeover law. In general, the
law prohibits a public Delaware corporation from engaging in a "business
combination" with an "interested stockholder" for a period of three years after
the date of the transaction in which the person became an interested
stockholder, unless the business combination is approved in a prescribed manner.
A "business combination" includes mergers, asset sales and other transactions
resulting in a financial benefit to the stockholder. An "interested stockholder"
is a person who, together with its affiliates and associates, owns or, within
three years, did own, 15% or more of the corporation's voting stock. A takeover
transaction frequently affords stockholders the opportunity to sell their shares
at a premium over current market price. The supermajority voting provisions in
our bylaws and these provisions regarding certain business combinations could
delay, defer or prevent a change in control of Osage or the removal of existing
management. Our certificate of incorporation also includes undesignated
preferred stock, which may enable the Board to discourage an attempt to obtain
control of us by means of a tender offer, proxy contest, merger or otherwise.
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One of our principal stockholders is able to elect all of our directors and
control our management and policies. As a result, Section 203 of the Delaware
General Corporation Law would not apply to such principal stockholder because
our board of directors approved the transaction that resulted in the principal
stockholder becoming an "interested stockholder."
8. Our dependence on our key customers means our net sales are vulnerable
if we lose a key customer.
Although dependence on our largest customers has diminished as revenues
have increased and the geographic scope of our business has expanded, a
substantial portion of our net sales and gross profits will continue to be
derived from sales to our largest customers. Motorola, Inc., our largest
customer which, in 1997 accounted for 64.8% of net sales, accounted for only
16.7%, 15.4% and 13.0% of net sales in the years ended 1998, 1999, and the six
ended June 30, 2000, respectively. No other customer accounted for more than
3.0% of our net sales for the year ended December 31, 1999. Through the six
months ended June 30, 2000 we had six customers, excluding Motorola, that
accounted for between 3%-8.5% of our net sales, with an average of 4.8%.
9. It may be difficult to judge our financial performance since our
quarterly operating results vary substantially. Accordingly, our past
operating results should not be relied upon to predict our future
performance.
In the past, our operating results have varied substantially from
quarter to quarter, and we expect that they will continue to do so. Our
quarterly operating results are influenced by, among others:
o the timing, size and stage of projects;
o new distribution channels for securing product;
o competitive pressures;
o product cost increases;
o product availability;
o vendor terms;
o cash availability;
o increasing sales costs;
o new service introductions by us or our competitors;
o information technology outsourcing trends;
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o the hiring of additional staff and increased selling and
administrative expenses associated with our growth;
o changes in our billing and employee utilization rates; and
o incurring costs incurred for projects in periods prior to recognizing
revenues for such contracts.
We must plan our operating expenditures based on revenue forecasts, and
a revenue shortfall below such forecast in any quarter would likely adversely
affect our operating results for the quarter. We believe, therefore, that you
should not rely on our past operating results and period-to-period comparisons
or to predict our future performance.
10. Because we are smaller than many of our competitors, we may lack the
financial resources needed to capture increased market share in the
information technology services industry. This could inhibit our growth
and profitability.
Many of our competitors have longer operating histories, possess
greater industry and name recognition and have significantly greater financial,
technical and marketing resources than us. If we compete with them for the same
markets, their financial strength could prevent us from capturing those markets.
For example, our larger competitors could launch extensive advertising campaigns
and discount services to attract or maintain customers. We may not have the
financial resources needed to effectively compete with them on that level.
Additionally, we have faced, and expect to continue to face, additional
competition from new entrants into our markets.
We believe that competitive factors in our markets include:
o quality of service and products;
o development of new products and services;
o price;
o project management capability; and
o technical and business expertise.
11. Our success is dependent upon retaining key management personnel,
especially our Chief Executive Officer. If key personnel leave us, our
business may not be successful.
Our future success will depend in large part upon our the continued
service of key management personnel, particularly Phil Carter, Chief Executive
Officer. While Mr. Carter has an employment agreement with us until November 29,
2001, he can terminate the agreement and may receive severance payments.
Currently, we do not maintain key man insurance on Mr. Carter or any of our
executive officers or key employees.
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12. Our sales and revenues will probably decrease if our suppliers do not
meet our demand for computer products at competitive prices.
Our business depends, in part, upon an adequate supply of hardware,
software products and computer systems at competitive prices and on reasonable
terms. Consequently, our results of operations are dependent upon the demand
for, price of, technical capabilities of and quality of the products available
for resale. Our principal supplier is Sun Microsystems, Inc. Additionally, we
obtain the largest part of Sun equipment and other inventory from GE Access
Graphics, Inc., a Sun master reseller.
To reduce the risk of product shortage, we attempt, when possible, to
procure some hardware and software products from multiple sources. Some products
are available from only a single source, as manufacturers elect to provide a
direct relationship with system integrators. We have supply contracts with
vendors and purchase hardware and software products and computer systems on a
purchase order basis. As a result, we cannot be certain that these products will
continue to be available as required by us at prices or on terms acceptable to
us.
During the fourth quarter of 1998, shortages of products from our
principal vendor significantly disrupted the orderly flow of products and had a
negative effect on our results of operations. These issues were short-term and
during 1999 the supply of product resumed to its historic levels.
13. Since we do not anticipate paying dividends on our common stock,
investors in the shares will probably not receive any.
We have not paid dividends since inception and we do not plan on paying
dividends on our common stock in the foreseeable future. The payment of future
dividends on our common stock will be directly dependent upon our earnings, our
financial needs and other similarly unpredictable factors. Earnings, if any, are
expected to be retained to finance and develop our business.
14. Our lender may not always loan us the money we need to operate our
business. If we do not have continuous access to credit, we may lose
customers and generate less revenue.
We obtain most of our working capital under a $20 million line of
credit with Coast Business Services. As of June 30, 2000, we had unpaid
borrowings of approximately $19.7 million of which $15.3 million was borrowed
from Coast. Coast has a lien on most of our assets as collateral for the line of
credit. If we do not timely collect our receivables from customers to pay down
the line of credit, or if Coast changes its lending policies, we may not have
sufficient credit available to us to operate our business. Any decrease or
significant limitation on the amount of accessible credit may limit our ability
to fill existing sales orders or expand our sales levels, thereby resulting in a
loss of revenues.
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15. Our stock price may be volatile due to factors under, as well as out
of, our control. This volatility may negatively affect the
profitability of investing in the shares.
The market price of our common stock could in the future be highly
volatile. Some factors that may affect the market price include:
o actual or anticipated fluctuations in our operating results;
o announcements of technological innovations or new commercial products
or services by us or our competitors;
o general market conditions in the computer software and hardware
industries; and
o changes in recommendations or earnings estimates by securities
analysts.
Furthermore, the stock market has historically experienced volatility
which has particularly affected the market prices of securities of many
technology companies and which sometimes has been unrelated to the operating
performances of such companies.
Forward-Looking Statements
This prospectus contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Although
forward-looking statements are based on assumptions made, and information
believed, by us to be reasonable, we cannot be certain that these statements
will prove to be correct. These statements are subject to risks, uncertainties
and assumptions. Should one or more of these risks or uncertainties materialize,
or should underlying assumptions prove incorrect, actual results may vary
materially from those anticipated, estimated, projected or expected.
Recent Developments
On September 22, 2000, we completed a private placement transaction
with six accredited investors to raise gross proceeds of $2,250,000 for general
working capital purposes. We sold the following securities in the private
placement:
o $2,250,000 of our 8% convertible notes, convertible into shares of
common stock at a price of $0.80 per share, subject to downward
adjustment based on the trading price of our common stock; and
o warrants to purchase 675,000 shares of our common stock.
The private placement will be completed in two closings. At the initial
closing on September 22, 2000, we issued the following:
o $1,500,000 of 8% convertible notes, and
o warrants to purchase 337,500 shares of common stock immediately
exercisable at $1.25 per share.
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At this closing we realized net proceeds of $1,355,000 after payment of a
finder's fee in the amount of $120,000 and escrow and counsel fees in the amount
of $25,000.
The final closing will occur three days after the effective date of the
registration statement of which this prospectus is a part. At the final closing
we will issue the following:
o $750,000 of 8% convertible notes, and
o warrants to purchase an additional 337,500 shares of common stock
immediately exercisable at $1.50 per share.
At the final closing, we will receive net proceeds of $690,000 after payment of
a finder's fee in the amount of $60,000,
Pursuant to our agreements with the investors in the private placement,
we have filed a registration statement with the SEC to register the public
resale of (i) 200% of the shares of common stock issuable upon conversion of the
notes; and (ii) 100% of the shares of common stock issuable upon exercise of the
warrants. We are required to cause the registration statement to be declared
effective by the SEC by no later than December 21, 2000. If we fail to comply
with this deadline, we will be required to pay a fine to the investors equal to
1% of the principal amount of the notes for the first thirty (30) day period or
part thereof of noncompliance and 2% for each thirty (30) day period or part
thereof thereafter. If we fail to cause the registration statement to be
declared by February 19, 2001, it will be deemed an event of default under the
notes resulting in the acceleration of our obligation to repay the principal
amount of the notes.
Use of Proceeds
We will not receive any of the proceeds from the sale of the shares
offered by this prospectus, although we may receive the exercise price of the
warrants. Any proceeds from the exercise of the warrants will be used for
general working capital purposes.
Selling Security Holders
The selling security holders identified in the following table are
offering for sale 7,142,825 shares of common stock. These shares include:
o 182,825 shares of common stock;
o up to 5,625,000 shares of common stock, which may be issued upon the
conversion of 8% convertible notes; and
o 1,335,000 shares of common stock which may be issued upon the
exercise of warrants.
We previously issued these shares of common stock, warrants and
debentures in private placement transactions.
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The following table sets forth as of October 24, 2000, the number of
shares being held of record or beneficially by the selling security holders and
provides by footnote reference any material relationship between us and the
selling security holder, all of which is based upon information currently
available to us. The percentage of ownership for each selling security holder
disclosed in the table is based on 33,294,462 shares of common stock outstanding
as of October 24, 2000, plus any common stock equivalents held by that holder.
Both the number of shares listed as being offered by the selling security
holders in the table and the holders' respective percentage of share ownership
after the offering are based on the assumptions that all of the shares being
offered are sold pursuant to this offering, and that no other shares of common
stock are acquired or disposed of by the selling security holders prior to the
termination of this offering. Because the selling security holders may sell all,
some or none of their shares or may acquire or dispose of other shares of common
stock, we cannot estimate the aggregate number of shares that will be sold in
this offering or the number or percentage of shares of common stock that each
selling security holder will own upon completion of this offering.
<TABLE>
<CAPTION>
Number of Beneficial
Beneficial Ownership of Shares Ownership of
Name of Selling Security Holder Prior Offered Shares
Selling Security Holder to Offering Hereby After Offering
-------------------------------- ----------------------------------------- ---------- --------------------
Number Percent Number Percent
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
Michael Lowther (1) 338,000 1.0% 88,000 250,000 *
Sharon O'Reilly (1) 338,000 1.0% 88,000 250,000 *
Robert Lantz (2) 5,250 * 5,250 0 0
Robert Burke (2) 1,575 * 1,575 0 0
Jonathon Siegel 78,917 (3) * 72,479 6,438 *
Bud Clarke 42,645 (3) * 30,881 11,764 *
Steve Caruso 41,647 (3) * 29,884 11,763 *
Stephen Schoffman 53,160 (3) * 29,556 23,604 *
Global Capital Partners, Inc. 106,250 (3) * 106,250 0 0
Global Capital Markets , LLC 250,950 (3) 1.5% 250,950 0 0
G.E. Access 140,000 (3) * 140,000 0 0
Celeste Trust Reg. 1,875,000 (4) 5.3% 1,875,000 0 0
Esquire Trade & Finance, Inc. 2,625,000 (4) 7.3% 2,625,000 0 0
The Keshet Fund, L.P. 206,250 (4) * 206,250 0 0
Keshet, L.P. 637,500 (4) 1.9% 637,500 0 0
Talbiya B. Investments, Ltd. 381,250 (5) 1.1% 381,250 0 0
Libra Finance, S.A. 575,000 (3) 1.7% 575,000 0 0
Total 7,642,795 7,142,825
-----------------------------
</TABLE>
* Less than 1.0%.
(1) An employee of Osage Systems Group Minnesota, Inc., our wholly-owned
subsidiary.
(2) An employee of Osage Systems Technologies, Inc., our wholly-owned
subsidiary.
(3) Includes shares that may be issued pursuant to the exercise of our
warrants.
(4) Includes shares that may be issued pursuant to the conversion of our 8%
convertible notes. Pursuant to our contractual obligation relating to
these convertible notes, the number of shares registered represents
200% of the shares issuable upon conversion of the notes based upon a
conversion price of $0.80.
10
<PAGE>
(5) Includes 100,00 shares that may be issued pursuant to the exercise of
our warrants and 281,250 shares that may be issued pursuant to the
conversion of our 8% convertible notes. Pursuant to our contractual
obligation relating to the convertible notes, the number of shares
registered represents 200% of the shares issuable upon conversion of
the note based upon a conversion price of $0.80.
The selling security holders may offer their shares of common stock for
sale from time to time at market prices prevailing at the time of sale or at
negotiated prices, and without payment of any underwriting discounts or
commissions except for usual and customary selling commissions paid to brokers
or dealers.
Under agreements with the selling security holders, we will pay all
offering expenses except the fees and expenses of any counsel and other advisors
that the selling security holder may employ to represent them in connection with
the offering and all brokerage or underwriting discounts or commissions paid to
broker-dealers in connection with the sale of the shares.
Description of Securities
Our authorized capital stock consists of 100,000,000 shares of common
stock, $.01 par value per share, and 10,000,000 shares of preferred stock, par
value $.01 per share.
Common stock
As of October 24, 2000 there were 33,294,462 shares outstanding.
Holders of common stock have equal rights to receive dividends when, as
and if declared by our board of directors, out of legally available funds.
Holders of common stock have one vote for each share held of record and do not
have cumulative voting rights.
Holders of common stock are entitled upon our liquidation to share
ratably in the net assets available for distribution, subject to the rights, if
any, of holders of any preferred stock then outstanding. Shares of common stock
are not redeemable and have no pre-emptive or similar rights. All outstanding
shares of common stock are fully paid and non-assessable.
Preferred stock
Subject to any limitations contained in our certificate of
incorporation, the board of directors may, without further action by the
stockholders, issue up to 10,000,000 shares of preferred stock, $.01 par value
per share, in one or more series. The board may set, as to any series, the
dividend rate, redemption prices, preferences on liquidation or dissolution,
sinking fund terms, if any, conversion rights, voting rights and any other
preference or special rights and qualifications.
11
<PAGE>
Options
We have issued options to purchase 3,936,076 shares of common stock in
private transactions or pursuant to our stock option plan, at exercise prices
ranging from $0.6875 to $7.25, subject to varying vesting periods. These options
expire at various dates through August, 2004.
Warrants
We have outstanding warrants to purchase 1,253,000 shares of common
stock, These warrants include warrants issued to our lender, as well as to
investors and certain placement agents and investment bankers in connection with
various private placement financings completed by us.
<TABLE>
<CAPTION>
Number of Warrants Date of Grant Expiration Date Exercise Price
------------------ ------------- --------------- --------------
<S> <C> <C> <C>
3,000 February 10, 1998 February 9, 2001 $3.50
25,000 May 8, 1998 May 7, 2001 $4.25
50,000 May 18, 1998 May 17, 2001 $4.25
35,000 September 30, 1998 October 1, 2001 $5.25
22,500 September 30, 1998 September 28, 2001 $5.25
200,000 November 12, 1998 November 11, 2003 $5.00
50,000 December 4, 1998 December 4, 2000 $4.75
100,000 December 31, 1998 December 30, 2001 $5.97
100,000 February 9, 1999 February 9, 2002 $7.875
10,000 February 12, 1999 February 12, 20020 $5.25
100,000 April 16, 1999 May 27, 2001 $4.25
100,000 December 30, 1999 December 30, 2004 $0.75
70,000 February 26, 2000 February 25, 2004 $2.04
50,000 May 22, 2000 May 21, 2003 $7.85
337,500 September 22, 2000 September 21, 2003 $1.25
</TABLE>
We are also committed to issuing the following:
o 337,500 warrants at an exercise price of $1.50 within three days
after the effective date of the registration statement of which
this prospectus is a part, as more fully described in the section
entitled "Recent Developments."
o 520,000 warrants at an exercise price of $1.0625
o 140,000 warrants at an exercise price of $1.00
12
<PAGE>
Convertible notes
We recently issued $1,500,000 of our 8% convertible notes and are
committed to issuing $750,000 of additional notes within three days after the
effectiveness of the registration statement of which this prospectus is a part.
The notes are convertible into shares of common stock at an initial conversion
price of $0.80 per share. Commencing March 22, 2001, the conversion price is
subject to downward adjustment based on the trading price of our common stock.
The conversion price will be adjusted to equal the average of the three lowest
closing prices of our common stock as reported on The American Stock Exchange
during the ten trading days preceding March 22, 2001 and each three month
anniversary thereafter, if such adjustment results in a decrease in the
conversion price.
Applicable rules of The American Stock Exchange preclude us from
issuing more than 5,941,976 shares of our common stock upon conversion of the
notes. In the event that the closing price of our common stock as reported on
The American Stock Exchange is less than $.50 for ten consecutive trading days,
we are required to obtain the approval of our stockholders for the issuance of
additional shares. Failure to obtain such approval will result in an event of
default and the acceleration of our obligation to repay any notes which can not
be converted. A delisting of our common stock from The American Stock Exchange
will also result in an event of default under the notes.
Registration rights
We prepared this prospectus pursuant to registration rights granted in
connection with the transactions where we sold shares of common stock and
securities convertible into or exercisable for common stock to the selling
security holders. We have also granted registration rights in connection with
recent acquisitions of businesses, private placement transactions, contracts for
financial advisory services and a lending arrangement.
Provisions having a possible anti-takeover effect
Delaware General Corporation Law
The provisions of Section 203 of the Delaware General Corporation Law,
an anti-takeover law, govern us. In general, the law prohibits a public Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless the business
combination is approved in a prescribed manner. "Business combination" includes
mergers, asset sales and other transactions resulting in a financial benefit to
the stockholder. An "interested stockholder" is a person who, together with its
affiliates and associates, owns (or within three years, did own) 15% or more of
the corporation's voting stock.
The provisions regarding certain business combinations could delay,
defer or prevent a change in control of us or the removal of existing
management. A takeover transaction frequently affords stockholders the
opportunity to sell their shares at a premium over current market prices.
13
<PAGE>
The provisions described above, together with the ability of the board
of directors to issue preferred stock, may delay or deter a change in the
control or management of us.
Certificate of Incorporation
Undesignated preferred stock may enable the board of directors to
discourage an attempt to obtain control of us by means of a tender offer, proxy
contest, merger or otherwise, and thereby to protect the continuity of our
management. The issuance of shares of the preferred stock pursuant to the board
of directors' authority described above may adversely affect the rights of the
holders of common stock. For example, preferred stock issued by us may rank
prior to the common stock as to dividend rights, liquidation preference or both,
may have full or limited voting rights and may be convertible into shares of
common stock. Accordingly, the issuance of shares of preferred stock may
discourage bids for the common stock or may otherwise reduce the market price of
the common stock.
Our certificate of incorporation provides that our board of directors
is divided into three classes, that directors shall only be removed for cause
and by a supermajority vote of stockholders, and that the consent of the Board
of Directors is required to amend the certificate of incorporation. These
provisions could delay or frustrate the removal of incumbent directors and could
make a change in control transaction more difficult.
Plan of Distribution
The selling security holders have not advised us of any specific plan
for distribution of the shares offered hereby, but it is anticipated that the
shares will be sold from time to time by the selling security holders or by
pledgees, donees, transferees or other successors in interest. Such sales may be
made on The American Stock Exchange, any other exchange upon which our shares
may trade in the future, over-the-counter, or otherwise, at prices and at terms
then prevailing or at prices related to the then current market price, or in
negotiated transactions. The shares may be sold by one or more of the following:
o a block trade in which the broker or dealer so engaged will
attempt to sell the shares as agent but may position and resell a
portion of the block as principal to facilitate the transaction;
o purchases by a broker or dealer for its account pursuant to this
prospectus;
o ordinary brokerage transactions and transactions in which the
broker solicits purchases;
o through options, swaps or derivatives;
o in privately negotiated transactions;
o in transactions to cover short sales;
14
<PAGE>
o through a combination of any such methods of sale; or
o in accordance with Rule 144 under the Securities Act, rather than
pursuant to this prospectus.
The selling security holders may sell their shares directly to
purchasers or may use brokers, dealers, underwriters or agents to sell their
shares. In effecting sales, brokers or dealers engaged by the selling security
holders may arrange for other brokers or dealers to participate. Brokers or
dealers may receive commissions, discounts or concessions from the selling
security holders, or, if any such broker-dealer acts as agent for the purchaser
of shares, from the purchaser in amounts to be negotiated immediately prior to
the sale. The compensation received by brokers or dealers may, but is not
expected to, exceed that which is customary for the types of transactions
involved. Broker-dealers may agree with a selling security holder to sell a
specified number of shares at a stipulated price per share, and, to the extent
the broker-dealer is unable to do so acting as agent for a selling security
holder, to purchase as principal any unsold shares at the price required to
fulfill the broker-dealer commitment to the selling security holder.
Broker-dealers who acquire shares as principal may thereafter resell the shares
from time to time in transactions, which may involve block transactions and
sales to and through other broker-dealers, including transactions of the nature
described above, in the over-the counter market or otherwise at prices and on
terms then prevailing at the time of sale, at prices then related to the
then-current market price or in negotiated transactions. In connection with
resales of the shares, broker-dealers may pay to or receive from the purchasers
of shares commissions as described above.
The selling security holders and any broker-dealers or agents that
participate with the selling security holders in the sale of the shares may be
deemed to be "underwriters" within the meaning of the Securities Act. In that
event, any commissions received by broker-dealers or agents and any profit on
the resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.
From time to time the selling security holders may engage in short
sales, short sales against the box, puts and calls and other hedging
transactions in our securities, and may sell and deliver the shares in
connection with such transactions or in settlement of securities loans. These
transactions may be entered into with broker-dealers or other financial
institutions. In addition, from time to time, a selling security holder may
pledge its shares pursuant to the margin provisions of its customer agreements
with its broker-dealer. Upon delivery of the shares or a default by a selling
security holder, the broker-dealer or financial institution may offer and sell
the pledged shares from time to time.
We will not receive any proceeds from the sale of the shares, although
we may receive the exercise price of any warrants that are exercised. We will
pay the expenses of preparing this prospectus and the related registration
statement. The selling security holders have been advised that they are subject
to the applicable provisions of the Securities Exchange Act of 1934, including
without limitation, Rules 10b-5 and Regulation M thereunder.
15
<PAGE>
Legal Matters
The validity of the issuance of the shares of common stock offered
hereby will be passed upon for us by Buchanan Ingersoll Professional
Corporation, Eleven Penn Center, 1835 Market Street, 14th Floor, Philadelphia,
Pennsylvania 19103.
Experts
The financial statements incorporated in this prospectus by reference
from the Company's Report on Form 10-KSB for the year ended December 31, 1999
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their report, which is incorporated herein by reference, and have been so
incorporated in reliance upon the report of such firm given upon their authority
as experts in accounting and auditing.
Indemnification of Directors and Officers
Our certificate of incorporation and bylaws reflect the adoption of the
provisions of Section 102(b)(7) of the Delaware General Corporation Law, which
eliminate or limit the personal liability of a director to our stockholders or
us for monetary damages for breach of fiduciary duty under certain
circumstances. If the GCL is amended to authorize corporate action further
eliminating or limiting personal liability of directors, the certificate of
incorporation provides that the liability of a director shall be eliminated or
limited to the fullest extent permitted by the GCL. Our certificate of
incorporation and bylaws also provide that we shall indemnify any person, who
was or is a party to a proceeding by reason of the fact that he is or was a
director, officer, employee or agent of ours, or is or was serving at our
request as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with a proceeding if he acted in good faith and in a manner he
reasonably believed to be or not opposed to our best interests, in accordance
with, and to the full extent permitted by, the GCL. The determination of whether
indemnification is proper under the circumstances, unless made by the court,
shall be determined by our board of directors.
We have liability insurance for the benefit of our directors and
officers. The insurance covers claims against such persons due to any:
o breach of duty; o misleading statement;
o neglect; o omission; or
o error; o act done.
o misstatement;
16
<PAGE>
The insurance covers such claims, except as prohibited by law, or otherwise
excluded by such insurance policy.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers, and controlling persons
pursuant to the foregoing provisions, or otherwise, we have 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.
Where You Can Find More Information
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any document we file at the SEC's public reference facilities at 450 Fifth
Street, N.W., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference room. Our SEC filings are also
available to the public from the SEC's web site at http://www.sec.gov and at the
Commission's regional offices at 7 World Trade Center, Suite 1300, New York, New
York 10048 and Northwest Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such materials may be obtained upon written
request addressed to the Commission at the Public Reference Section, at 450
Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Our SEC filings
are also available at the office of The American Stock Exchange. For further
information on obtaining copies of our public filings at The American Stock
Exchange, you should call 212-306-1484.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings made
with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until the selling security holders sell all the shares.
1. Annual Report on Form 10-KSB for the year ended December 31, 1999;
2. Quarterly Report on Form 10-Q for the three months ended March 31,
2000;
3. Quarterly Report on Form 10-Q for the six months ended June 30,
2000; and
4. The description of our common stock, $.01 par value per share,
which is contained in our registration statement on Form 8-A filed
pursuant to Section 12(b) of the Securities Exchange Act of 1934,
as amended, dated November 18, 1998, including any subsequent
amendments or reports filed for the purpose of updating such
description.
We will provide, without charge, to each person, including any
beneficial owner, to whom a copy of this prospectus is delivered, upon the
written or oral request of such person, a copy of any or all of the information
incorporated herein by reference. Exhibits to any of such documents, however,
will not be provided unless such exhibits are specifically incorporated by
reference into such documents. The requests should be made to:
Robert Peterson, Chief Financial Officer
Osage Systems Group, Inc.
1661 East Camelback Road, Suite 245
Phoenix, Arizona 85016
(602) 274-1299
17
<PAGE>
[LOGO]
7,142,825 shares
Osage Systems Group, Inc.
Common Stock
-------------------
P r o s p e c t u s
-------------------
[--------------]
<PAGE>
PART II
Item 14. Other Expenses of Issuance and Distribution.
SEC registration fee $ 1,120
Counsel fees and expenses*........................... $ 15.000
Accounting fees and expenses*........................ $ 15,000
Miscellaneous expenses*.............................. $ 5,000
------------
Total*.......................................... $ 36,120
* Estimated
We will bear all expenses of issuance and distribution listed above.
The costs of fees and expenses of legal counsel and other advisors, if any, that
any selling security holder employs in connection with the offering will be
borne by that selling security holder.
Item 15. Indemnification of Directors and Officers.
Our certificate of incorporation and bylaws reflect the adoption of the
provisions of Section 102(b)(7) of the Delaware General Corporation Law, which
eliminate or limit the personal liability of a director to our stockholders or
us for monetary damages for breach of fiduciary duty under certain
circumstances. If the GCL is amended to authorize corporate action further
eliminating or limiting personal liability of directors, the certificate of
incorporation provides that the liability of a director shall be eliminated or
limited to the fullest extent permitted by the GCL. Our certificate of
incorporation and bylaws also provide that we shall indemnify any person who was
or is a party to a proceeding by reason of the fact that he is or was a
director, officer, employer or agent of ours, or is or was serving at our
request as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with a proceeding if he acted in good faith and in a manner he
reasonably believed to be or not opposed to our best interests, in accordance
with, and to the full extent permitted by, the GCL. The determination of whether
indemnification is proper under the circumstances, unless made by a court, shall
be determined by the board of directors.
We have liability insurance for the benefit of our directors and
officers. The insurance covers claims against such persons due to any:
o breach of duty; o misleading statement;
o neglect; o omission; or
o error; o act done.
o misstatement;
<PAGE>
The insurance covers such claims, except as prohibited by law, or otherwise
excluded by such insurance policy.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers, and controlling persons
pursuant to the foregoing provisions or otherwise, we have 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.
We refer you to Item 17 for our undertakings with respect to
indemnification of liabilities arising under the Securities Act.
Item 16. Exhibits.
Exhibit No. Description of Exhibit
----------- ----------------------
4.1 Subscription Agreement dated as of September
22, 2000 by and among Osage and certain
purchasers
4.2 Form of Convertible Note
4.3 Form of Common Stock Purchase Warrant
5 Opinion of Buchanan Ingersoll Professional
Corporation as to validity of common stock.
23.1 Consent of Deloitte & Touche LLP.
23.2 Consent of Buchanan Ingersoll Professional
Corporation (contained in the opinion filed
as Exhibit 5 to the Registration Statement).
Item 17. Undertakings.
(a) The undersigned Registrant hereby undertakes that it will:
(1) File, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement to include any
additional or changed material information on the plan of distribution.
(2) For determining liability under the Securities Act, treat
each such post-effective amendment as a new registration statement of the
securities offered, and the offering of such securities at that time shall be
the initial bona fide offering.
(3) File a post-effective amendment to remove from
registration any of the securities that remain unsold at the end 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 foregoing provisions, 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 whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
<PAGE>
Signatures
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 registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix, State of Arizona, on the 25th day of
October, 2000.
Osage Systems Group, Inc.
By: /s/ Phil Carter
---------------------------------
Chairman of the Board and
Chief Executive Officer
By: /s/ Robert T. Peterson
---------------------------------
Chief Financial Officer/Principal
Accounting Officer
Power of Attorney
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Phil Carter and Robert T. Peterson, and
each of them, his true and lawful attorneys-in-fact and agents with full power
of substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this registration statement, 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, and
each of them, 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 or any of them, or their
or his substitute or substitutes, any lawfully do or cause to be done by virtue
hereof.
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Phil Carter Chairman, Chief Executive Officer and October 25, 2000
----------------------------- Director
Phil Carter
/s/ Robert T. Peterson Chief Financial Officer October 25, 2000
------------------------
Robert Peterson
/s/ George Knight Director October 25, 2000
-----------------
George Knight
/s/ Gerald Harrington Director October 25, 2000
---------------------
Gerald Harrington
/s/ Edward Stead Director October 25, 2000
----------------
Edward Stead
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit No. Description of Exhibit
----------- ----------------------
4.1 Subscription Agreement dated as of
September 22, 2000 by and among Osage and
certain purchasers Filed herewith
4.2 Form of Convertible Note Filed herewith
4.3 Form of Common Stock Purchase Warrant Filed herewith
5 Opinion of Buchanan Ingersoll Professional
Corporation as to validity of common stock. Filed herewith
23.1 Consent of Deloitte & Touche LLP. Filed herewith
23.2 Consent of Buchanan Ingersoll Professional
Corporation (contained in the opinion filed
as Exhibit 5 to the Registration Statement). Filed herewith
