<PAGE> 1
As filed with the Securities and Exchange Commission
on October 23, 1996
Registration No. 333- ____
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------------------
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933, AS AMENDED
---------------------------------------
AMERICAN PHOENIX GROUP, INC.
----------------------------
(Exact name of registrant as specified in its charter)
Delaware
--------
(State or other jurisdiction
of incorporation or organization)
--------------------------------
13-376855
---------
(I.R.S. Employer Identification No.)
5 Park Plaza
Irvine, California 92714
(714) 224-2525
(Address, including zip code, and telephone number,
including area code, of registrant's principal
executive offices)
-------------------------------
DANIEL A. FRANCE
5 Park Plaza
Irvine, California 92714
(714) 224-2525
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copies to:
-------------------------------
RICHARD F. HOROWITZ, ESQ.
IRVING ROTHSTEIN, ESQ.
Heller, Horowitz & Feit, P.C.
292 Madison Avenue
New York, New York 10017
<PAGE> 2
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Approximate date of commencement of proposed sale to public:
As soon as practicable after the effective date
of the 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 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 delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. |___|
<TABLE>
- -------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
<CAPTION>
Proposed
Maximum Proposed
Title of Each Class Amount Offering Maximum Amount of
of Securities to to be Price Per Aggregate Registra-
be Registered Registered Share(2) Price(2) tion Fee
- ------------------- ---------- --------- --------- ----------
<S> <C> <C> <C> <C>
Common Stock(1) 4,307,532 $2.96875 $12,787,985 $3,875.15
- ----------------------------------------------------------------------------
Total Registration Fee $12,787,985 $3,875.15
- ----------------------------------------------------------------------------
</TABLE>
(1) To be offered by selling security holders, at their
discretion, from time to time beginning from the effective
date of this Registration Statement, at prevailing market
prices at time of sale.
(2) Estimated solely for the purpose of calculating the
registration fee. Proposed maximum offering price per
share is estimated based upon the closing price on
October 16, 1996.
<PAGE> 3
The registrant hereby amends the 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 the registration
statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
KUSHI MACROBIOTICS CORP.
Cross Reference Sheet Showing Location in Prospectus of
Information Required Therein by Item 1 through 13 of Form S-3
<TABLE>
<CAPTION>
Registration Statement Prospectus Caption
Item and Heading of Location
----------------------- -------------------
<S> <C> <C>
1. Forepart of the Registration Outside Front Cover
Statement and Outside Front
Cover Page of Prospectus............
Inside Front Cover
2. Inside Front and Outside Back Page
Cover Pages and Prospectus..........
3. Summary Information, Outside Front Cover,
Prospectus Summary Risk Factors
and Ratio of Earnings to
Fixed Charges....................... Use of Proceeds
4. Use of Proceeds..................... Not Applicable
5. Determination of Offering Price. Not Applicable
6. Dilution............................ Selling Security
Holders
7. Selling Security Holders ...........
Cover Page,
Plan of Distribution
8. Plan of Distribution................
9. Description of the Securities to
be Registered....................... Not Applicable
10. Interest of Named Experts and
Counsel............................. Not Applicable
11. Material Changes.................... Not Applicable
</TABLE>
iii
<PAGE> 4
<TABLE> <C>
<S> <C>
12. Incorporation of Certain
Information by Reference............ Incorporation of Certain
Documents by Reference
13. Disclosure of Commission Position
on Indemnification for Securities
Act Liabilities..................... Disclosure of Commission
Position on
Indemnification for
Securities Act
Liabilities
</TABLE>
iv
<PAGE> 5
SUBJECT TO COMPLETION
DATED OCTOBER 23, 1996
-----------------
AMERICAN PHOENIX GROUP, INC.
----------------------
This Prospectus covers the offer and proposed sale of up to 4,307,532
shares of Common Stock, $.001 par value (the "Common Stock"), of American
Phoenix Group, Inc., formerly called Kushi Macrobiotics Corp. (the
"Company"), held by security holders who acquired them directly from the
Company for services provided or in settlement of claims (the "Shares").
See "Selling Securityholders".
The holders of the Shares are collectively referred to herein as the
"Selling Securityholders."
Each of the Selling Securityholders may be deemed to be an "underwriter"
of the Company's securities offered hereby, as that term is defined under
the Securities Act of 1933, as amended (the "Act"). Each of the Selling
Securityholders intends to sell the Shares offered hereby from time to time
for their own account in the open market at the prices prevailing therein,
or in individually negotiated transactions at such prices as may be agreed
upon. Each of the Selling Securityholders will bear all expenses with
respect to the offering of the Shares by them except the costs associated
with registering the Shares under the Act and preparing and printing this
Prospectus.
The net proceeds from the Shares to be sold by the Selling
Securityholders will inure entirely to their benefit and not that of the
Company.
The Company's Common Stock is traded on NASDAQ (Symbol - "KMAC"). The
closing price of the Company's Common Stock on October 21, 1996 was $3.875.
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK AND SUBSTANTIAL DILUTION AS
DESCRIBED HEREIN. See "RISK FACTORS".
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------------------
<PAGE> 6
With respect to the proposed sale of the Shares by the Selling
Securityholders (if any of such holders are deemed to be an "affiliate" of
the Company), the Company is taking steps either to register the Shares or
permit such sales (or resales) pursuant to exemption from registration under
the laws only of California and New York. However, if purchasers of the
Shares are not residents of the aforementioned states, the Company will not
be able to permit them to effect transfers of the Shares sold by the Selling
Securityholders, unless the purchaser resides in a state which permits such
transactions as exempt from registration. Under such circumstances, the
only alternatives may be to sell to a resident of the aforementioned states
or to sell to an entity, such as a state registered broker - dealer, which
may be exempt under applicable state laws. Potential purchasers of the
Shares should consult with their broker and/or attorney to determine what
actions should be taken to comply with the laws of their state with respect
to any such Shares to be purchased by them. To the extent any state laws
require, transactions may only be conducted through state registered
broker-dealers.
The Company will furnish to each person to whom this Prospectus is
delivered, upon written request, a copy of any or all of the documents
referred to by reference, other than exhibits to such documents unless such
exhibits are specifically incorporated herein by reference. Requests should
be addressed to: Mr. Daniel A. France, Chief Financial Officer, American
Phoenix Group, Inc., 5 Park Plaza, Irvine, California, 92714. The Company's
telephone number is (714) 224-2525.
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS. ANY INFORMATION OR REPRESENTATION NOT HEREIN CONTAINED, IF
GIVEN OR MADE, MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN
RESPECT OF THE SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION WOULD BE UNLAWFUL. DELIVERY OF THIS PROSPECTUS SHALL NOT,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE OF THIS PROSPECTUS.
2
<PAGE> 7
ADDITIONAL INFORMATION
The Company has filed with the headquarters office of the Securities and
Exchange Commission located at 450 Fifth Street, N.W., Washington, D.C.
20549, a Registration Statement on Form S-3 under the Securities Act of 1933
with respect to the securities offered hereby. This Prospectus filed as
part of such Registration Statement does not contain all the information set
forth in, or annexed as exhibits to, the Registration Statement. For
further information pertaining to the securities offered hereby and the
Company, reference is made to the Registration Statement and the exhibits
thereto. The Registration Statement and exhibits thereto may be inspected
at the Headquarters Office of the Securities and Exchange Commission located
at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at certain
of the Commission's regional offices at the following addresses: 7 World
Trade Center, 13th Floor, New York, New York 10048; and 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies of such material may be
obtained from the Public Reference Section of the SEC, at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. at prescribed rates. The Commission also
maintains a Web Site that contains reports, proxy and information statements
and other information regarding registrants such as the Company, that file
electronically with the Commission. This material can be found at
http://www.sec.gov.
3
<PAGE> 8
THE COMPANY
The Company was formed under the laws of the State of Delaware in May
1994 under the name Kushi Macrobiotics Corp., to develop, produce and/or
market a full line of high quality natural foods based on Michio Kushi's
Standard Macrobiotic Diet. In August 1995, the Company raised approximately
$4.8 million in its initial public offering ("IPO") of Common Stock and
Warrants, which proceeds were used to fund activities undertaken during the
Company's development phase. The sale and shipment of product began in the
last quarter of fiscal 1995. In early 1996, management determined that
revenues and profit margins were not adequate to sustain the business as a
going concern. Since then, the Company's management has focused on finding
a merger, joint venture or strategic alliance partner to protect stockholder
equity. To conserve its working capital pending fulfillment of this
objective, the Company reduced its staff and liquidated or otherwise
resolved certain of its contractual obligations. In May 1996, the Company
executed a definitive agreement to merge (the "Merger") with American
Phoenix Group, Inc. a Nevada corporation ("American Phoenix"), which was
subsequently amended in July 1996 (the "Merger Agreement"). The Merger was
consummated on September 26, 1996, whereupon the Company changed its name to
"American Phoenix Group, Inc."
Upon effectiveness of the Merger, American Phoenix merged with and into
the Company, the separate existence of American Phoenix ceased and the
Company was the surviving corporation. As a consequence of the Merger,
title to all of the property and assets of American Phoenix vested in the
Company and the Company is subject to all of the liabilities of American
Phoenix.
Pursuant to the Merger Agreement the Company spun-off its natural foods
business to the Company's stockholders. The Spin-off is being accomplished
by (i) the transfer and assignment of substantially all of the assets and
certain of the liabilities of the Company to Kushi Natural Foods Corp.
("Kushi Foods") and (ii) the declaration by the Company of a dividend on
each share of Common Stock outstanding as of a record date prior to the
effective time of the Merger of the stock of Kushi Foods.
The Company now seeks to create shareholder value by acquiring, financing
and developing technology-related companies. Presently, the Company is an
international holding company which continues to seek acuqisitions which, in
the opinion of management, are likely to yield enhanced shareholder value
and long-term growth.
The Company now has three subsidiaries: Marine Turbine Australian Pty.,
Ltd. ("MTA"), an Australian proprietary limited company; Masling Industries
Pty. ("Masling"), an Australian proprietary limited company; and Tokan
Holdings, Inc. ("Tokan"), a Delaware corporation through which American
Phoenix has a minority interest in Barlile Corp., Ltd. ("Barlile"), an
Australian entity engaged in a variety of agricultural ventures. MTA has
developed a
4
<PAGE> 9
prototype modular power unit (MPU) for use in high speed ocean pursuit
craft. The MPU employs an innovative proprietary gearbox technology which
yields improved performance and efficiency. American Phoenix also derives
revenue from a portfolio of promissory notes. Masling is an aircraft
component overhaul and engineering facility.
On September 16, 1996, the Company and Tetherless Access Asia Limited
("TAAL"), a privately held company with operations in Africa, Asia,
Australia and the United States, announced that representatives of the two
companies were meeting to explore the possibility of a business combination.
A conclusion to the discussions is expected shortly.
TAAL is a wireless data communications service provider capitalizing on
the exploding demand for alternatives to the high cost of wire line
communications networks in developing economies. TAAL provides leading-edge
technology and network services for wireless transaction control
protocol/Internet protocol ("TCP/IP") data communications utilizing
spread-spectrum packet radio technology to deliver a high-speed, scalable,
secure networking solution. TAAL delivers virtual TCP/IP networking
services, including high speed Internet access and providing solutions to
customers in a range of industries including defense, education, finance,
government, manufacturing and retail.
No assurance can be given that any transaction with TAAL will be
consummated, what form the transaction will take or that if any transaction
is in fact consummated that it will ultimately prove beneficial to the
Company and its stockholders.
The Company's corporate office is now located at 5 Park Plaza, Irvine,
California, 92714 at which its telephone number is (714) 224-2525.
The Company's Common Stock is traded on NASDAQ (Symbol - "KMAC"). The
closing price of the Company's Common Stock on October 21, 1996 was $3.875.
RISK FACTORS
The securities being offered hereby represent a speculative investment
and a high degree of risk. Therefore, prospective investors should
thoroughly consider all of the risk factors discussed below and should
understand that they could lose all or part of their investment. No person
should consider investing who cannot afford to lose a substantial part or
all of his investment or who is in any way dependent upon the funds that he
is investing.
NECESSITY OF AN EFFECTIVE REGISTRATION STATEMENT: BLUE SKY REGISTRATION
OR EXEMPTION. The Company will endeavor promptly to maintain a current
effective registration statement under the Act covering the Common Stock.
If the Company is unable to maintain a
5
<PAGE> 10
current registration statement for any reason, holders of the Shares may not
be able to transfer them and even if there is a current registration
statement covering the Shares it is possible that they or their intended
transferee could reside in a state where such transactions would not be
permitted under state securities laws.
DILUTIVE EFFECT OF WARRANT EXERCISE. The Company currently has
6,052,906 warrants outstanding. Although in the opinion of management the
infusion of capital resulting from exercise of the warrants would benefit
the Company by providing a source of funding for the acquisition and
development expenses associated with its corporate objectives, any such
exercise of warrants would dilute the percentage ownership of the Company.
Moreover, the issuance of substantial amounts of Common Stock upon the
exercise of the warrants could negatively impact the market price of such
stock.
INCURRENCE OF LIABILITIES RELATING TO THE PRE-MERGER OPERATIONS OF
THE COMPANY. From the date of its inception and thereafter, the Company has
incurred debts and liabilities in the operation of its natural foods
business. Pursuant to the Merger Agreement, in conjunction with the
Spin-Off, all of the liabilities of the Company, subject to specified
exceptions, will be transferred to Kushi Foods. Although this transfer of
liabilities is valid and effective as between the Company and Kushi Foods,
the Company will remain liable to third parties for all of claims and debts
arising out of the pre-Spin-Off business of the Company. Moreover,
notwithstanding the Spin-Off, the Company will remain liable on the two
leaseholds entered into by the Company in connection with its natural foods
business, although Kushi Foods will provide the Company with a contractual
indemnification of such leasehold obligations.
In the event that the assets of Kushi Foods are insufficient to
satisfy any claim, obligation or liability arising out of the pre-Spin-Off
operations of the Company, a creditor of Kushi Foods may seek satisfaction
of any such claim, obligation or liability from the assets of the Company.
Any such claims which may arise, to the extent that they are material and to
the extent that the assets of Kushi Foods are insufficient to satisfy such
claims, amy adversely affect the financial condition of the Company.
UNSPECIFIED ACQUISITIONS. The Company intends to engage in
acquisitions of other companies and businesses and will likely use its stock
as consideration therefor. This may result in a dilution of the percentage
of the equity to be owned by the investors in this offering. In addition,
such acquisitions may involve speculative and risky undertakings by the
Company. Under Delaware law, acquisitions do not require stockholder
approval; however, certain acquisitions accomplished by merger or
consolidation do require stockholder approval. The Company does not, in
general, intend to submit acquisitions to stockholder vote except where
required by Delaware Law.
6
<PAGE> 11
DILUTION. Certain stockholders of the Company acquired their
interests in the Company at an average cost per share which is significantly
less than that which purchasers of the Shares offered hereby will pay for
their stockholdings. Consequently, the purchasers of the Shares offered
hereby will bear a disproportionate share of the risk of any loss that may
be incurred in the Company's operations and an investment in the Company's
securities will result in an immediate substantial dilution of the offering
price.
NO CASH DIVIDENDS AND NONE ANTICIPATED. The Company has not paid
any cash dividends and does not contemplate or anticipate paying any cash
dividends in the foreseeable future.
LIMITED MARKET FOR SECURITIES. The Company's securities currently
trade on NASDAQ as a small cap issue, and trading volume generally is not at
a high level. As a result, there is a limited market in the Company's
securities, and there can be no assurance that a more active market may
develop. Accordingly, any investments in the Company's securities may be
highly illiquid. Further, no assurance can be given that the Company will
meet the criteria applicable to it for maintaining a listing on NASDAQ as a
small cap issue on an ongoing basis.
POSSIBLE ISSUANCE OF PREFERRED STOCK AND POSSIBLE ADVERSE EFFECT ON
RIGHTS OF HOLDERS OF COMMON STOCK. The Company is authorized to issue
10,000,000 shares of preferred stock. While the Company has no present
intention of issuing any preferred stock, the Board of Directors has broad
powers to fix the rights and terms of any preferred stock without requiring
stockholder approval. The issuance of preferred stock could have an adverse
effect on the rights of holders of the Company's Common Stock.
TEMPORARY LOSS OF MARKET-MAKERS. Pursuant to Rule 10b-6, any of the
Company's market-makers will be prohibited from engaging in any
market-making activities with respect to the Company's securities for the
period of ten business days prior to any solicitation by it of the exercise
of any of the Company's public warrants until the termination of such
activity. Accordingly, such market-maker may be unable to provide a market
for the Company's securities during certain periods and, as a result,
holders of the Company's securities may find it more difficult to sell their
holdings.
REQUIRED DISCLOSURE CONCERNING TRADING OF PENNY STOCKS OR LOW-PRICED
SECURITIES. The Securities and Exchange Commission ("SEC") has adopted
regulations that define a "penny stock" to be any equity security that has a
market price (as defined) of less than $5.00 per share or an exercise price
of less than $5.00 per share, subject to certain exceptions. Effective July
15, 1992, for any transaction involving a penny stock, unless exempt, the
rules require the delivery, prior to the transaction of a disclosure
schedule prepared by the SEC relating to the penny stock market. Commencing
January 1, 1993, the broker-dealer also must disclose the commissions
payable to both the broker-dealer and the registered
7
<PAGE> 12
representative, current quotations for the securities and, if the
broker-dealer is the sole market-maker, the broker-dealer must disclose this
fact and the broker-dealer's presumed control over the market. Finally,
monthly statements must be sent disclosing recent price information for the
penny stock held in the account and information on the limited market in
penny stocks.
While many NASDAQ-listed securities would be covered by the
definition of penny stock, transactions in a NASDAQ-listed security would be
exempt from all but the sole market-maker provision for (i) issuers who have
$2,000,000 in tangible assets ($5,000,000 if the issuer has not been in
continuous operation for three years), (ii) transactions in which the
customer is an institutional accredited investor, and (iii) transactions
that are not recommended by the broker-dealer. In addition, transactions in
a NASDAQ security directly with a NASDAQ market-maker for such securities
would be subject only to the sole market-maker disclosure, and the
disclosure with respect to commissions to be paid to the broker-dealer and
the registered representative. Finally, all NASDAQ securities would be
exempt if NASDAQ raised its requirements for continued listing so that any
issuer with less than $2,000,000 in net tangible assets or stockholders'
equity would be subject to delisting. These criteria are more stringent
than the current NASDAQ maintenance requirements. Consequently, these rules
may restrict the ability of broker-dealers to sell the Company's securities
and may affect the ability of purchasers to sell the Company's securities in
the secondary market.
The following additional factors should be considered in connection with
evaluating the business and prospectus of American Phoenix which, upon the
Merger, will become the business of the Company.
LIMITED OPERATING HISTORY. The current corporate strategy of the Company
is to identify, acquire and develop emerging technologies. The Company (and
American Phoenix prior to the Merger) has only a limited history operating
under this present corporate strategy. Between August 1994 and August 1995,
American Phoenix discontinued all operations in its original environmental
business and entered a development stage. American Phoenix first generated
net revenues during the second quarter ending February 29, 1996. Prior to
the Merger, American Phoenix's revenues were generated principally by its
subsidiary MTA, manufacturer of high speed interdiction boats and Masling an
engineering subsidiary of MTA. American Phoenix also earned revenue from
its note portfolio. MTA has not begun commercial production of the next
generation of its principal product. There can be no assurance that these
operations will be profitable or that subsidiaries will generate significant
revenue from product sales or services. The likelihood of success of the
Company must be considered light of the problems, experiences, difficulties,
complications and delays frequently encountered in connection with the
operation and development of new and expanding businesses.
8
<PAGE> 13
COMPETITION. Management anticipates that the industries in which
the Company will operate will be intensely competitive. This competition is
expected to increase with the pace of technological developments. Current
and future competitors may have significantly greater financial, technical,
manufacturing and marketing resources than the Company and its subsidiaries.
This will be especially true if the Company completes a deal with TAAL.
RAPID TECHNOLOGICAL CHANGE. The industries which have in the past
been targeted by American Phoenix are characterized by rapid technological
change. As a result, other technologies may emerge that offer
technological,price or other marketing advantages over technologies to which
the Company presently or hereafter becomes committed. Lower profit margins
frequently are obtained on newer products than might be typical of mature
products. The Company currently intends to focus on companies with emerging
technologies which are not likely to have mature products or substantial
market share. Characteristically of participants in industries experiencing
rapid technological change, the Company's subsidiaries are likely to use
product components that are not of standard industry design and products and
services supplied by a small number of suppliers. Although these suppliers
may be replaceable, the Company could face significant production delays if
any components or services were to become unavailable. The Company's
ability to exploit emerging technologies will be subject to all of the
foregoing risks as well as being dependent upon its ability to develop and
market applications of emerging technologies.
ADDITIONAL FUNDING MAY BE REQUIRED. Achievement of Management's
objectives will be dependent upon its ability to access significant capital.
Current Management believes that it can raise sufficient capital through
private placements, registered public offerings or exercise of outstanding
warrants. If, for any reasons, sufficient capital is unavailable, the
ability to develop and market existing businesses and to acquire new or
additional businesses will be adversely affected.
DILUTION. In the recent past, the Company (and prior to the Merger,
American Phoenix also) has sought to acquire technologies and assets though
the issuance or exchange of its capital stock. Management anticipates that
the Company will continue to seek acquisition and merger transactions that
can be effected in this manner. If the net tangible book value of such
businesses or assets divided by the number of shares issued in connection
with such transaction is less than the net tangible book value of the
Company's shares outstanding prior to such transaction, the then current
owner of the Common Stock will suffer immediate dilution in the net tangible
book value of their investment. No assurance can be given that such
transactions will not result in dilution to existing stockholders.
INTERNATIONAL RISKS. The Company's subsidiaries currently operate
in Australia and are expected to conduct substantial business activities in
the Pacific Rim. Foreign manufacturing and
9
<PAGE> 14
sales activities are subject to the risks of operating in an international
environment. These risks include unstable political and economic
environments, local labor laws and customs, local laws and taxes, the
potential imposition of trade or foreign exchange restrictions, tariff
increases and transportation delays. In addition, financial results are
subject to fluctuations in foreign currency exchange rats within the
countries where it operates. The risk of foreign exchange losses has been
mitigated by the conduct of most of the Company's foreign business
transactions in local currency. It is anticipated that this practice will
be continued by the Company.
DEPENDENCE UPON MANAGEMENT. The Company will be dependent upon the
international expertise of its new management team (which has come primarily
from the previous management of American Phoenix) and financial advisors to
meet its strategic objectives. None of these persons necessarily have
significant operational or marketing experience in the industries in which
companies that the Company may acquire will compete.
10
<PAGE> 15
USE OF PROCEEDS
The net proceeds from the Shares to be sold by the Selling
Securityholders will inure entirely to their benefit and not that of the
Company.
PLAN OF DISTRIBUTION
It is anticipated that the Selling Securityholders will offer the Shares
for sale at the prices prevailing in the over-the-counter market (or other
principal market, if any, on which the Shares may then be traded) on the
date of sale. Such holders also may sell the Shares privately, either
directly to the purchaser or through a broker or brokers. There are no
arrangements or agreements with any brokers or dealers to act as underwriter
of the Shares as of the date hereof. All costs, expenses and fees incurred
in connection with the registration of the Shares, including but not limited
to all registration and filing fees, printing expenses and fees (if any) and
disbursements of the Company's counsel and accountants are being borne by
the Company, but all selling and other expenses incurred by the holders will
be borne by the holders.
SELLING SECURITY HOLDERS
This Prospectus covers the proposed offer and resale of up to 4,307,532
shares of the Company's Common Stock. The Shares were issued to the
Securityholders in payment for services rendered to the Company or in
settlement of outstanding obligations.
The officers and directors of the Company who are offering Shares and
their percentage ownership is contained in the chart below listing the
Selling Securityholders. Except as indicated below, none of the Shares are
held by officers or directors of the Company or, to the Company's knowledge,
by any 1% holders of the Company's Common Stock. The Company will receive
no proceeds from the Shares being offered hereby.
11
<PAGE> 16
<TABLE>
==================================================================
Names Shares Shares Shares
----- Held Offered owned
After Sale
==================================================================
<S> <C> <C> <C>
Patrick N. Di Carlo(1) 2,096,070 2,096,070 -0-
AVIVA Corporation Ltd. 500,000 500,000 -0-
John Errecart 270,000 270,269 -0-
Brian Krupp 213,350 213,350 -0-
Michael D. Wells 213,350 213,350 -0-
Daniel A. France(2) 265,046 206,675 58,371
Asset Management
Partners, LLC 145,078 145,078 -0-
Fred Ninneman 130,570 130,570 -0-
Kurt Zimmerman 128,010 128,010 -0-
Patrick N. Di Carlo, Jr. 89,607 89,607 -0-
Cornelius Ryan 85,340 85,340 -0-
Douglas K. Simpson 53,338 53,338 -0-
Rhonda Thorstad 50,000 50,000 -0-
Net Group Financial, LLC 46,937 46,937 -0-
Norman G. Doyle 32,003 32,003 -0-
Jay W. Hubbard(3) 21,335 21,335 -0-
J.V. Rasinski 21,335 21,335 -0-
Lisa Ham 4,267 4,267 -0-
</TABLE>
- ------------------------------------------------------------------
(1) Chairman and Chief Executive Officer
(2) Chief Financial Officer and Director
(3) Director
==================================================================
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(a) (1) The Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1995, filed pursuant to Section 13 of the Shares Exchange
Act of 1934, as amended (the "Exchange Act").
(2) The Company's Quarterly Report on Form 10-QSB for the fiscal
Quarter ended March 31, 1996, filed pursuant to Section 13 of the Exchange
Act.
The Company's Quarterly Report on Form 10-QSB for the fiscal Quarter
ended June 30, 1996, filed pursuant to Section 13 of the Exchange Act.
(3) The description of the Common Stock contained in the Company's
Registration Statement on Form 8-A filed pursuant to Section 12(g) of the
Exchange Act.
12
<PAGE> 17
(4) The Company Registration Statement on Form S-4 declared
effective September 3, 1996 (Registration No.333-10755).
(b) In addition, all reports and other documents to be filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act,
prior to the filing of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters all securities
offered hereby then remaining unsold, as well as all such reports filed
after the date hereof and prior to the termination of this offering, shall
be deemed to be incorporated by reference herein and shall be deemed to be a
part hereof from the date of the filing of each such report or document.
LEGAL OPINIONS
Legal matters in connection with the securities being offered hereby will
be passed upon for the Company by Heller, Horowitz & Feit, P.C., 292 Madison
Avenue, New York, New York 10017.
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SHARES ACT LIABILITIES
Section 145 of the Delaware General Corporation Law, as amended,
authorizes the Company to indemnify any director or officer under certain
prescribed circumstances and subject to certain limitations against certain
costs and expenses, including attorneys' fees actually and reasonably
incurred in connection with any action, suit or proceeding, whether civil,
criminal, administrative or investigative, to which such person is a party
by reason of being a director or officer of the Registrant if it is
determined that such person acted in accordance with the applicable standard
of conduct set forth in such statutory provisions, Article 9 of the
Registrant's Certificate of Incorporation contains provisions relating to
the indemnification of directors and officers, to the full extent permitted
by Delaware law.
The Company may also purchase and maintain insurance for the benefit of
any director or officer which may cover claims for which the Company could
not indemnify such person.
Insofar as indemnification for liabilities arising under the Shares Act
of 1933 may be permitted to directors, officers and controlling persons of
the Small Business Issues pursuant to the foregoing provisions, or
otherwise, the Small Business Issues has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore unenforceable.
13
<PAGE> 18
<TABLE>
TABLE OF CONTENTS
PAGE NO.
<S> <C>
THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SELLING SECURITY HOLDERS . . . . . . . . . . . . . . . . . . . . . . . . 11
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE . . . . . . . . . . . . . 12
LEGAL OPINIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SHARES ACT LIABILITIES . . . . . . . . . . . . . . . 13
</TABLE>
14
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following statement sets forth the estimated expenses in connection
with the offering described in the Registration Statement.
<TABLE>
<S> <C>
Shares and Exchange Commission Fee................ $3,875
NASDAQ Additional Listing Fee..................... 7,500
Accountants' Fees and Expenses.................... 1,000
Legal Fees and Expenses........................... 8,000
Blue Sky Qualification, Fees and Expenses......... 575
Miscellaneous..................................... $1,625
-------
TOTAL $22,000
</TABLE>
Item 15. Indemnification of Directors and Officers.
Section 145 of the Delaware General Corporation Law, as amended,
authorizes the Registrant to indemnify any director or officer under certain
prescribed circumstances and subject to certain limitations against certain
costs and expenses, including attorneys' fees actually and reasonably
incurred in connection with any action, suit or proceeding, whether civil,
criminal, administrative or investigative, to which such person is a party
by reason of being a director or officer of the Registrant if it is
determined that such person acted in accordance with the applicable standard
of conduct set forth in such statutory provisions, Article 9 of the
Registrant's Certificate of Incorporation contains provisions relating to
the indemnification of directors and officers, to the full extent permitted
by Delaware law.
The Registrant may also purchase and maintain insurance for the benefit
of any director or officer which may cover claims for which the Registrant
could not indemnify such person.
II-1
<PAGE> 20
Item 16. Exhibits
Registrant hereby incorporates by reference the following documents files as
part of its Registration Statement on Form SB-2 (File No. 33-92154-NY),
declared effective August 11, 1995 (the "Registration Statement"):
3.1 Restated Certificate of Incorporation
3.2 By-Laws
4.1 Specimen Common Stock Certificate
The following exhibits are filed herewith:
5 Opinion re: legality
23(a) Consent of Israeloff, Trattner & Co.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes;
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement 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, 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 posteffective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) 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 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
II-2
<PAGE> 21
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 Act and will be governed by the
final adjudication of such issue.
II-3
<PAGE> 22
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 Irvine, State of California, on
October 22, 1996.
AMERICAN PHOENIX GROUP, INC.
By: s/ Patrick N. Di Carlo
-------------------------------
Name: Patrick N. Di Carlo
Title: Chief Executive Officer
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.
SIGNATURE TITLE DATE
- --------- ----- ----
s/Patrick N. Di Carlo Chairman and October 22, 1996
- ---------------------------- Chief Executive
Patrick N. Di Carlo Officer
s/Daniel A. France Director, Chief October 22, 1996
- ---------------------------- Financial Officer
Daniel A. France and Secretary
s/John Davis Director October 22, 1996
- --------------------------
John Davis
s/Jay W. Hubbard Director October 22, 1996
- --------------------------
Jay W. Hubbard
II-4
<PAGE> 23
EXHIBIT INDEX
5 Opinion re: legality
23(a) Consent of Israeloff, Trattner & Co.
<PAGE> 1
[HELLER, HOROWITZ & FEIT, P.C. LETTERHEAD]
October 23, 1996
American Phoenix Group, Inc.
5 Park Plaza
Irvine, California 92714
Attn: Mr. Daniel A. France
Gentlemen:
As counsel for your Company, we have examined your Articles of
Incorporation, By-Laws, such other corporate records, documents and
proceedings and such questions of law as we have deemed relevant for the
purpose of this opinion.
We have also, as such counsel, examined the Registration Statement
(the "Registration Statement") of your Company on Form
S-3, covering the registration under the Securities Act of 1933, as amended,
of the proposed offer and resale by selling security holders of up to
4,307,532 shares of the Company's Common Stock, par value $.001 (the "Common
Stock"), referred to herein as the "Registered Securities." Our review has
also included the exhibits and form of prospectus (the "Prospectus") for the
resale of the Registered Securities.
On the basis of such examination, we are of the opinion that:
1. The Company is a corporation duly authorized and validly
existing and in good standing under the laws of the State of Delaware, with
corporate power to conduct the business which it conducts as described in the
Registration Statement.
2. The Registered Shares have been duly and validly authorized and
are fully paid and nonassessable shares of Common Stock of the Company.
<PAGE> 2
American Phoenix Group, Inc.
October 23, 1996
Page 2
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name in the Prospectus under the
caption "Legal Matters."
Very truly yours,
/s/ HELLER, HOROWITZ & FEIT
---------------------------------
HELLER, HOROWITZ & FEIT, P.C.
<PAGE> 1
Exhibit 23 (a)
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement of
American Phoenix Group, Inc. (formerly called Kushi Macrobiotics Corp.) on
Form S-3 of our report dated February 2, 1996 except for Note 11, as to which
the date is March 22, 1996, appearing in and incorporated by reference in the
Annual Report on Form 10-KSB of American Phoenix Group, Inc. (formerly called
Kushi Macrobiotics Corp.) for the year ended December 31, 1995
/s/ ISRAELOFF, TRATTNER & CO.
--------------------------------
ISRAELOFF, TRATTNER & CO., P.C.
Valley Stream, New York
October 23, 1996
