AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 3, 1999.
Registration No. 333 -
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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HOMESEEKERS.COM, INCORPORATED
(Exact Name of Registrant as Specified in Its Charter)
Nevada 87-0397464
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(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
6490 South McCarran Boulevard
Suite D-28
Reno, Nevada 89509
(775) 827-6886
(Address, including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
Gregory L. Costley, CEO
HomeSeekers.com, Incorporated
6490 South McCarran Boulevard Suite D-28
Reno, Nevada 89509
(775) 827-6886
(Name, Address, including Zip Code, and Telephone Number,
including Area Code, of Agent for Service)
Copies to:
Patrick J. Leddy, Esq.
Jones, Day, Reavis & Pogue
901 Lakeside Avenue
Cleveland, OH 44114
(216) 586-7290
Approximate date of commencement of proposed sale to 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. [ ]
<PAGE>
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>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Maximum Maximum Amount of
Title of Shares Amount to Offering Price Aggregate Registration
to be Registered be Registered(1) Per Share(2) Offering Price Fee
- ---------------- ---------------- ------------ -------------- ---
<S> <C> <C> <C> <C> <C>
Common Stock, par value
$.001 per share(3) 6,188,619(4) $ 11.8125 $ 73,103,062 $7,233.03(4)
</TABLE>
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(1) The shares of common stock being registered hereunder are being
registered for resale by the selling shareholders named in the
prospectus and consist of an aggregate of 4,948,649 shares of
outstanding common stock the selling shareholders own outright and an
aggregate of 1,239,970 shares issuable to the selling shareholders upon
exercise of outstanding warrants.
(2) Estimated solely for the purpose of computing the amount of the
registration fee pursuant to Rule 457(c) and (g) based on the average
of the high and low prices on the Nasdaq SmallCap Market on December 2,
1999.
(3) Pursuant to Rule 416, there are also being registered such additional
shares of common stock as may be issuable pursuant to the anti-dilution
provisions of the warrants.
(4) Includes 3,869,227 shares previously registered on a registration
statement on Form SB-2 (Registration No. 333-73441), which are being
carried forward and included in this Registration Statement pursuant to
Rule 429 under the securities act. The registrant paid Registration
Fees of $9,092.58 on March 5, 1998 in connection with the original
registration of 7,922,782 shares. Therefore, the Registration Fee has
been calculated on the Registration of 2,319,392 shares.
-------------------------
The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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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 is not soliciting an offer to buy these securities
in any state where the offer or sale is not permitted.
PROSPECTUS (Subject to Completion)
Dated December 3, 1999
6,188,619 Shares
HOMESEEKERS.COM, INCORPORATED
Common Stock
This prospectus relates to the proposed sale of 6,188,619 shares of
common stock, $.001 par value per share, of HomeSeekers.com, Incorporated by
certain selling shareholders, of which 1,239,970 shares are underlying warrants.
The selling shareholders acquired their shares in transactions not involving a
public offering. We will not receive any proceeds from the sale of the shares by
the selling shareholders. However, we will receive the proceeds from the cash
exercise of any warrants.
The selling shareholders may, from time to time, offer their shares of
common stock through public or private transactions at prevailing market prices
or privately negotiated transactions.
Our common stock is traded on the Nasdaq SmallCap Market under the
trading symbol "HMSK". On December 2, 1999, the closing price for our common
stock was $11.750 per share.
---------------------
See "Risk Factors" on page 3 for certain risks you should consider
before you purchase any shares.
---------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
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The date of this prospectus is ______________, 1999.
<PAGE>
TABLE OF CONTENTS
Page
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Risk Factors..............................................................3
The Company...............................................................13
Use of Proceeds...........................................................13
Selling Shareholders......................................................14
Plan of Distribution......................................................19
Legal Matters.............................................................20
Experts .................................................................20
Indemnification...........................................................20
Where You Can Find More Information.......................................20
Incorporation of Certain Documents by Reference...........................21
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RISK FACTORS
You should carefully consider the risks described below before buying
shares of our common stock. If any of the following risks actually occur, our
business, financial condition and results of operations could be materially and
adversely affected, the trading price of our common stock could decline and you
could lose all or part of your investment.
INVESTING IN OUR COMMON STOCK MAY EXPOSE YOU
TO THE FOLLOWING RISKS INHERENT IN OUR BUSINESS.
WE CURRENTLY ARE NOT PROFITABLE AND MAY RECORD SIGNIFICANT LOSSES FOR
THE FORESEEABLE FUTURE.
We incurred a net loss of $2.6 million for the three months ended
September 30, 1999 and an aggregate net loss of $7.6 million for the two-year
period ended June 30, 1999, including net losses of $4.8 million and $2.8
million for the years ended June 30, 1999 and 1998, respectively. We have an
accumulated deficit as of September 30, 1999 of $17.8 million. We may record
significantly greater net losses for the foreseeable future, as we expect to
incur significant expenses in the foreseeable future. These expenses will
include product development expenses, sales and marketing costs, general
administrative expenses and acquisition costs. There can be no assurance that we
will achieve sufficient additional revenues to offset anticipated operating and
acquisition costs. We will continue to have high levels of operating expenses
and will be required to make significant expenditures in connection with our
product development activities and our sales and marketing infrastructure
development. We may never achieve profitability. If we fail to achieve
profitability or sustain or increase profitability if we achieve it, our
business, operating results and financial condition will be materially harmed.
MARKET COMPETITION AMONG OUR EXISTING AND POTENTIAL COMPETITORS MAY
ADVERSELY AFFECT OUR BUSINESS.
The market for on-line real estate content and e-commerce providers is
rapidly evolving and highly competitive, and we expect competition to intensify
in the future. Our failure to maintain and enhance our competitive position
could seriously harm our business. The technological and other requirements to
remain competitive are changing continually, and we must be able to respond to
changes in the industry in order to remain competitive. Our competitors vary in
size and in the scope and breadth of products and services they offer.
Our principal competitors for real estate professionals, homebuyers,
sellers and renters and related content include:
o Websites offering real estate listings together with other
related services, such as homestore.com, Apartments.com,
CyberHomes, HomeHunter.com, iOwn, LoopNet, Microsoft's
HomeAdvisor, NewHomeNetwork.com and RentNet;
o Websites offering real estate related content and services
such as mortgage calculators and information on the home
buying, selling and renting processes;
o general purpose consumer Websites such as AltaVista and
Yahoo! that also offer real estate-related content on their
site; and
o traditional print media such as newspapers and magazines.
Our principal competitors for advertising revenues include:
o Web portals and other general purpose consumer Websites such
as AltaVista, America Online, Excite, Lycos, Netscape's
Netcenter and Yahoo!;
o online ventures of traditional media, such as classified
advertising services offered through daily and other
newspapers' Websites; and
o traditional media such as newspapers, magazines and
television.
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The barriers to entry for Web-based services and businesses are low,
making it possible for new competitors to proliferate rapidly. In addition,
parties with whom we have listing and marketing agreements could choose to
develop their own Internet strategies or competing real estate sites upon the
termination of their agreements with us. Many of our existing and potential
competitors have longer operating histories in the Internet market, greater name
recognition, larger consumer bases and significantly greater financial,
technical and marketing resources than we do, and thus could respond more
quickly to changing opportunities, technology and consumer demands. Also, some
of our current and potential competitors have better name recognition and more
extensive customer bases that may allow them to gain additional market share to
our detriment. These competitors may be able to undertake more extensive
promotional activities and adopt more competitive pricing policies for
advertising and goods and services than we can. In addition, our competitors,
especially those with greater resources than we have, could significantly
enhance their product offerings by developing improved technology solutions or
offering daily updates of listings. This could significantly reduce or eliminate
any competitive advantage we currently might have and, accordingly, could
significantly harm our business.
Competitive pressures may make it difficult for us to acquire market
share. We cannot be certain that we will be able to compete successfully with
existing or new competitors. If we fail to compete successfully against current
and future competitors, our business and prospects will be seriously harmed.
OUR QUARTERLY FINANCIAL RESULTS ARE SUBJECT TO SIGNIFICANT
FLUCTUATIONS.
Our results of operations could vary significantly from quarter to
quarter. In the near term, we expect to be substantially dependent on sales of
our advertising products and services. We also expect to incur significant sales
and marketing expenses to promote our brand and services. Therefore, our
quarterly revenues and operating results are likely to be particularly affected
by the number of persons purchasing advertising products and services as well as
sales and marketing expenses for a particular period. If revenues fall below our
expectations, we will not be able to reduce our spending rapidly in response to
the shortfall.
Other factors that could affect our quarterly operating results include
those described below and elsewhere in this prospectus:
o the amount of advertising sold on our Website and the timing
of payments for this advertising;
o the level of renewals for our advertising products and
services by real estate agents and brokers;
o the amount and timing of our operating expenses and capital
expenditures;
o costs related to acquisitions of businesses or technologies;
o changes in the mix of products and services we sell; and
o increased sales, marketing, administrative and research and
development expenses.
Our quarterly revenues increased 285% from the quarter ended September
30, 1998 to the quarter ended September 30, 1999 and 70% from the quarter ended
June 30, 1999 to the quarter ended September 30, 1999. We do not believe that
these rates of growth are indicative of future growth in revenues, if any, that
we can expect in the future. Accordingly, we believe that period-to-period
comparisons of our operating results may not be meaningful, and you should not
rely on these comparisons as an indication of our future performance. Our
operating results may fall below the expectations of investors. In this event,
the market price of our common stock would likely fall.
OUR BRAND MAY NOT ACHIEVE THE BROAD RECOGNITION NECESSARY TO SUCCEED.
We believe that broader recognition and a favorable consumer perception
of the HomeSeekers.com brand are essential to our future success. Successful
positioning of the HomeSeekers.com brand will largely depend on the success of
our advertising, marketing and promotion efforts and our ability to continue to
provide high quality real estate content. We intend to pursue an aggressive
brand development strategy, which will include substantially larger advertising,
marketing and promotional programs than those historically undertaken by us.
These initiatives will involve significant expense. If our brand development
strategy is unsuccessful, these expenses may never be recovered and we may never
be able to generate a profit.
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WE MUST CONTINUE TO OBTAIN LISTINGS FROM REAL ESTATE AGENTS, BROKERS,
HOMEBUILDERS, MULTIPLE LISTING SERVICES AND PROPERTY OWNERS.
We believe that our success depends in large part on the number of real
estate listings received from agents, brokers, homebuilders, MLSs and
residential, rental and commercial property owners. Many of our agreements with
MLSs, brokers and agents to display property listings have fixed terms,
typically 12 to 30 months. At the end of the term of each agreement, the other
party may choose not to continue to provide listing information to us and may
choose to provide this information to one or more of our competitors instead. In
addition, some of these providers of listings may choose to provide their
listings to one or more of our competitors on an exclusive basis. In particular,
at least one of our competitors has entered into exclusive listing arrangements
with a significant number of MLSs. In order for us to display listings covered
by these arrangements, we seek to obtain the consent of the individual brokers
who provide these listings to the MLSs. Accordingly, these listings can be more
difficult to obtain and involve more recruiting costs to acquire them. Our use
of these listings could potentially subject us to claims by the parties to these
exclusive listing arrangements. If our competitors are successful in increasing
the number of exclusive listing arrangements with MLSs or large groups of
brokers, we may be limited in the number of listings we are able to display on
our Website and our business may be harmed. We have expended significant amounts
to secure agreements for listings of real estate for sale and may be required to
spend additional large amounts or offer other incentives in order to renew these
agreements. If owners of large numbers of property listings, such as large
brokers, MLSs, or property owners in key real estate markets choose not to renew
their relationship with us, our Website could become less attractive to other
real estate industry participants or consumers.
IT IS IMPORTANT TO OUR SUCCESS THAT WE SUPPORT OUR REAL ESTATE
PROFESSIONAL CUSTOMERS.
Since many real estate professionals are not sophisticated computer
users and often spend limited amounts of time in their offices, it is important
that these customers find that our products and services significantly enhance
their productivity and are easy to use. To meet these needs, we provide customer
training and have developed a customer support organization that seeks to
respond to customer inquiries as quickly as possible. If our real estate
professional customer base grows, we may need to expand our support organization
further to maintain satisfactory customer support levels. If we need to enlarge
our support organization, we would incur higher overhead costs. If we do not
maintain adequate support levels, these customers could choose to discontinue
using our service.
BECAUSE WE HAVE EXPANDED OUR OPERATIONS, OUR SUCCESS WILL DEPEND ON OUR
ABILITY TO MANAGE OUR GROWTH.
We have experienced, and expect to continue to experience, periods of
rapid growth that strain our administrative, financial and operational
resources. Our ability to manage any staff and facilities growth effectively
will require us to continue to improve our operational, financial and management
controls, reporting systems and procedures, to install new management
information and control systems and to train, motivate and manage our employees.
There can be no assurance that we will install such management information and
control systems in an efficient and timely manner or that the new systems will
be adequate to support our future operations. If we are unable to hire, train
and retain qualified systems engineers and consultants to implement these
services or are unable to manage the post-sales process effectively, our ability
to attract repeat sales or provide references could be materially adversely
affected, thereby limiting our growth opportunities. If our management is unable
to manage growth effectively, which would happen if our sales and marketing
efforts exceed our capacity to install, maintain and service our products or if
new employees are unable to achieve adequate performance levels, our business,
financial condition and results of operations would be adversely affected.
OUR BUSINESS OPERATIONS DEPEND ON THE CONTINUING CONTRIBUTION OF OUR
KEY PERSONNEL.
Our future success depends to a significant extent on the continued
service of our key technical and senior management personnel. Loss of the
services of any of Gregory L. Costley, our Chairman of the Board and Chief
Executive Officer, John Giaimo, our President and Chief Operating Officer,
Douglas Swanson, our Vice Chairman and Executive Vice President, Greg Johnson,
our Chief Technology Officer, or James A. Dykstra, our Chief Financial Officer,
could have an adverse effect on our business, financial condition and results of
operations.
Mr. Costley joined us in August 1999 and Mr. Dykstra joined us in
September 1999. As a result, our senior management does not have a history of
working together as a team. Failure to maintain an effective team of senior
managers would adversely affect the operation of our business.
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WE MUST ATTRACT AND RETAIN PERSONNEL WHILE COMPETITION FOR PERSONNEL IN
OUR INDUSTRY IS INTENSE.
We may be unable to retain our key employees or to attract, assimilate
or retain other highly qualified employees. We have from time to time in the
past experienced, and we expect in the future to continue to experience,
difficulty in hiring and retaining highly skilled employees with appropriate
qualifications as a result of our rapid growth and expansion. Attracting and
retaining qualified personnel with experience in the real estate industry, a
complex industry that requires a unique knowledge base, is an additional
challenge for us. In addition, there is significant competition among companies
in the Internet industry for qualified employees. If we do not succeed in
attracting new personnel or retaining and motivating our current personnel, our
business, financial condition and results of operations will be adversely
affected.
WE NEED TO CONTINUE TO DEVELOP OUR CONTENT AND OUR PRODUCT AND SERVICE
OFFERINGS.
To remain competitive we must continue to enhance and improve the ease
of use, responsiveness, functionality and features of our Website. These efforts
may require us to develop internally or to license increasingly complex
technologies. In addition, many companies are continually introducing new
Internet-related products, services and technologies, which will require us to
update or modify our technology. Developing and integrating new products,
services or technologies into our Website could be expensive and time consuming.
For example, we may experience difficulties in integrating, or be unable to
integrate, the technologies that we recently acquired from Terradatum with our
MLS 2000 product to create an enhanced product for MLS data handling solutions.
Any new features, functions or services may not achieve market acceptance or
enhance our brand loyalty. If we fail to develop and introduce or acquire new
features, functions or services effectively and on a timely basis, we may not
continue to attract new users and may be unable to retain our existing users.
Furthermore, we may not succeed in incorporating new Internet technologies or,
in order to do so, we may incur substantial expenses.
OUR RECENT ACQUISITIONS AND ANY FUTURE ACQUISITIONS MAY RESULT IN OUR
NOT ACHIEVING THE DESIRED BENEFITS OF THE TRANSACTION. RISKS RELATED TO OUR
ACQUISITIONS INCLUDE:
o difficulties in assimilating the operations of the acquired
businesses;
o potential disruption of our existing businesses;
o assumption of unknown liabilities and litigation;
o our inability to integrate, train, retain and motivate
personnel of the acquired businesses;
o diversion of our management from our day-to-day operations;
o our inability to incorporate acquired products, services and
technologies successfully into our Website;
o potential impairment of relationships with our employees,
customers and strategic partners; and
o inability to maintain uniform standards, controls procedures
and policies.
Our inability to successfully address any of these risks could
adversely affect our business, financial condition and results of operations.
WE DEPEND ON THIRD-PARTY RELATIONSHIPS, MANY OF WHICH ARE SHORT-TERM OR
TERMINABLE, TO GENERATE ADVERTISING AND PROVIDE US WITH CONTENT.
We depend, and will continue to depend, on a number of third-party
relationships to increase traffic on HomeSeekers.com and thereby generate
advertising and other revenues. Outside parties on which we depend include
unrelated Website operators that provide links to HomeSeekers.com and providers
of real estate content. Many of our relationships with third-party Websites and
other third-party service providers are not exclusive and are short-term or may
be terminated at the convenience of either party. We cannot assure you that
third parties regard our relationship with them as important to their respective
businesses and operations. They may reassess their commitment to us at any time
in the future and may develop their own competitive services or products.
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We cannot assure you that we will be able to maintain relationships
with third parties that supply us with content or related products or services
that are crucial to our success, or that such content, products or services will
be able to sustain any third-party claims or rights against their use. Also, we
cannot assure you that the content, products or services of those companies that
provide access or links to our Website will achieve market acceptance or
commercial success. Accordingly, we cannot assure you that our existing
relationships will result in sustained business partnerships, successful product
or service offerings or the generation of significant revenues for us.
OUR SUCCESS IS DEPENDENT UPON THE INTELLECTUAL PROPERTY THAT WE USE IN
OUR BUSINESS.
We regard our Internet domain name, copyrights, service marks,
trademarks, trade secrets and similar intellectual property that we use in our
business as critical to our success. We rely on a combination of copyright,
trademark and trade secret laws, confidentiality procedures, contractual
provisions and license and other agreements with employees, customers and others
to protect our intellectual property rights. In addition, we may also rely on
the third party owners of the intellectual property rights we license to protect
those rights. Effective Internet domain name, copyright, service mark, trademark
and trade secret protection may not be available in every country in which our
products and services are made available online. The steps taken by us and other
third parties to protect our intellectual property rights may not be adequate,
and third parties may infringe or misappropriate the intellectual property and
similar proprietary rights used in our business, which could have an adverse
effect on our business, financial condition and results of operations.
We are also subject to the risk of adverse claims and litigation
alleging infringement of the intellectual property rights we use. The resolution
of any infringement claims may result in lengthy and costly litigation.
Moreover, resolution of a claim may require us to obtain a license to use those
intellectual property rights or possibly to cease using those rights altogether.
Any of those events could have a material adverse effect on our business,
financial condition and results of operations.
OUR INTERNATIONAL BUSINESS IS SUBJECT TO A NUMBER OF RISKS ASSOCIATED
WITH DOING BUSINESS ABROAD.
Although we have not actively marketed our products and services to
brokers, agents, homebuilders and other real estate professionals located
outside of North America, we intend to market our Website and products and
services globally. Our international business is subject to a number of risks
generally associated with doing business abroad, including:
o fluctuations in currency exchange rates, the impact of
recessions in economies outside the United States and
regulatory and political changes in foreign markets;
o reduced protection for intellectual property rights in some
countries; and
o potential limits on use of some of our trademarks and
licensed trademarks outside the United States.
These factors could adversely affect our business, financial condition
and results of operations. In addition, expansion into new international markets
may present competitive challenges different from those we currently face. We
cannot assure you that we will expand internationally or that any such expansion
will result in profitable operations.
INVESTORS IN OUR COMMON STOCK ARE SUBJECT TO
THE FOLLOWING RISKS ASSOCIATED WITH THE REAL ESTATE INDUSTRY.
OUR BUSINESS IS DEPENDENT ON THE STRENGTH OF THE REAL ESTATE INDUSTRY,
WHICH IS BOTH CYCLICAL AND SEASONAL.
The real estate industry traditionally has been cyclical. Recently,
sales of real estate in the United States have been at historically high levels.
Economic swings in the real estate industry may be caused by various factors.
When interest rates are high or general national and global economic conditions
are or are perceived to be weak, there typically is less sales activity in real
estate. A decrease in the current level of sales of real estate and products and
services related to real estate could adversely affect demand for our Website
and our advertising products and
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services. In addition, reduced traffic on our Website would likely cause our
advertising revenues to decline, which would adversely affect our business,
financial condition and results of operations.
We may experience seasonality in our business. The real estate industry
experiences a decrease in activity during the winter. However, because of our
limited operating history under our current business model, it is difficult for
us to fully assess the impact of seasonal factors on our business. If we are
unable to effectively manage our resources in anticipation of any seasonality of
our revenues and the increased costs we may incur during periods of lower
revenues, our business would be materially harmed.
WE MAY PARTICULARLY BE AFFECTED BY GENERAL ECONOMIC CONDITIONS.
Purchases of real property and related products and services are
particularly affected by negative trends in the general economy. The success of
our operations depends to a significant extent upon a number of factors relating
to discretionary consumer and business spending and the overall economy, as well
as regional and local economic conditions in markets where we operate,
including:
o perceived and actual economic conditions;
o interest rates;
o taxation policies;
o availability of credit;
o employment levels; and
o wage and salary levels.
In addition, because a consumer's purchase of real property and related
products and services is a significant investment and is relatively
discretionary, any reduction in disposable income in general may affect us more
significantly than companies in other industries.
WE HAVE RISKS ASSOCIATED WITH CHANGING LEGISLATION IN THE REAL ESTATE
INDUSTRY.
Real estate is a heavily regulated industry in the U.S. These
regulations include the Fair Housing Act, the Real Estate Settlement Procedures
Act and state advertising laws. In addition, states could enact legislation or
regulatory policies in the future that could require us to expend significant
resources to comply. These laws and related regulations may limit or restrict
our activities. For example, we are limited in the criteria upon which we may
base searches of our real estate listings and may not use criteria such as age
or race. As the real estate industry evolves in the Internet environment,
legislators, regulators and industry participants may advocate additional
legislative or regulatory initiatives. Should existing laws or regulations be
amended or new laws or regulations be adopted, we may need to comply with
additional legal requirements and incur resulting costs, or we may be precluded
from certain activities. To date, we have not spent significant resources on
lobbying or related government issues. Any need to significantly increase our
lobbying or related activities could substantially increase our operating costs.
THE FOLLOWING RISKS INHERENT IN DOING BUSINESS
OVER THE INTERNET COULD ADVERSELY AFFECT OUR BUSINESS.
WE DEPEND ON INCREASED USE OF THE INTERNET TO EXPAND OUR REAL ESTATE
RELATED ADVERTISING PRODUCTS AND SERVICES.
If the Internet fails to become a viable marketplace for real estate
content, information and e-commerce, our business will not grow. Broad
acceptance and adoption of the Internet by consumers and businesses when
searching for real estate and related products and services will only occur if
the Internet provides them with greater efficiencies and improved access to
information.
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IN ADDITION TO SELLING ADVERTISING PRODUCTS AND SERVICES TO REAL ESTATE
PROFESSIONALS, WE DEPEND ON SELLING OTHER TYPES OF ADVERTISEMENTS ON OUR
WEBSITE.
Our business would be adversely affected if the market for Internet
advertising fails to develop or develops more slowly than expected. Our ability
to generate advertising revenues from selling banner advertising and
sponsorships on our Website and products targeted at real estate professionals
will depend on, among other factors, the development of the Internet as an
advertising medium, the amount of traffic on our Website and our ability to
achieve and demonstrate demographic characteristics among the users of our
Website and other products and services that are attractive to advertisers. Many
potential advertisers and their advertising agencies have only limited
experience with the Internet as an advertising medium and have not devoted a
significant portion of their advertising expenditures to Internet-based
advertising. No standards have been widely accepted to measure the effectiveness
of Internet advertising. If these standards do not develop, existing advertisers
might reduce their current levels of Internet advertising or eliminate their
spending entirely. The widespread adoption of technologies that permit Internet
users to selectively block out unwanted graphics, including advertisements
attached to Webpages, could also adversely affect the growth of the Internet as
an advertising medium. In addition, advertisers in the real estate industry,
including real estate professionals, have traditionally relied upon other
advertising media, such as newsprint and magazines, and have invested
substantial resources in other advertising methods. These persons may be
reluctant to adopt a new strategy and advertise on the Internet.
GOVERNMENT REGULATIONS AND LEGAL UNCERTAINTIES COULD AFFECT THE GROWTH
OF THE INTERNET.
A number of legislative and regulatory proposals under consideration by
federal, state, local and foreign governmental organizations may lead to laws or
regulations concerning various aspects of the Internet, including online
content, user privacy, access charges, liability for third-party activities and
jurisdiction. Additionally, it is uncertain as to how existing laws will be
applied to the Internet. The adoption of new laws or the application of existing
laws may decrease the growth in the use of the Internet, which could in turn
decrease the usage and demand for our services or increase our cost of doing
business.
Some local telephone carriers have asserted that the increasing
popularity and use of the Internet have burdened the existing telecommunications
infrastructure, and that many areas with high Internet use have begun to
experience interruptions in telephone service. These carriers have petitioned
the Federal Communications Commission to impose access fees on Internet service
providers and online service providers. If access fees are imposed, the costs of
communicating on the Internet could increase substantially, potentially slowing
the increasing use of the Internet. This could in turn decrease demand for our
services or increase our cost of doing business.
OUR INABILITY TO SECURE AND PROTECT OUR INTERNET DOMAIN NAME MAY
ADVERSELY AFFECT OUR BUSINESS OPERATION.
The www.HomeSeekers.com Internet domain name is our brand on the
Internet. The acquisition and maintenance of Internet domain names generally is
regulated by governmental agencies and their designees. Until recently, Network
Solutions, Inc. was the exclusive registrar for the ".com," ".net" and ".org"
generic top-level Internet domains in the U.S. In April 1999, however, the
Internet Corporation for Assigned Names and Numbers, or ICANN, a new global
non-profit corporation formed to oversee a set of the Internet's core technical
management functions, opened the market for registering Internet domain names to
an initial group of five companies. Network Solutions, Inc. still maintains the
registry containing all the registrations in the generic top-level Internet
domains. The market for registering these Internet domain names in the U.S. and
in foreign countries is expected to undergo further changes in the near future.
We expect the requirements for registering Internet domain names also to be
affected. The relationship between regulations governing Internet domain names
and laws protecting trademarks and similar proprietary rights is unclear. We may
be unable to prevent third parties from acquiring Internet domain names that are
similar to, infringe upon or otherwise decrease the value of our Internet domain
name, the trademarks and other intellectual property rights used by us and we
may need to protect our rights through litigation. If we are unable to
adequately protect our Internet domain name, our trademarks and other
intellectual property rights or incur substantial costs in doing so, it could
have an adverse effect on our business, financial condition and results of
operations.
9
<PAGE>
TAXATION OF INTERNET TRANSACTIONS COULD SLOW THE USE OF THE INTERNET.
The tax treatment of the Internet and electronic commerce is currently
unsettled. A number of proposals have been made at the federal, state and local
level and by various foreign governments to impose taxes on the sale of goods
and services and other Internet activities. Recently, the Internet Tax
Information Act was signed into law placing a three-year moratorium on new state
and local taxes on Internet commerce. However, future laws may impose taxes or
other regulations on Internet commerce, which could substantially impair the
growth of e-commerce.
WE DEPEND ON CONTINUED IMPROVEMENTS TO OUR COMPUTER NETWORK AND THE
INFRASTRUCTURE OF THE INTERNET.
Any failure of our computer systems that causes interruption or slower
response time of our Website or services could result in a smaller number of
users of our Website or the Websites and Webpages that we host for real estate
professionals. If sustained or repeated, these performance issues could reduce
the attractiveness of our Website to consumers and our advertising products and
services to real estate professionals, providers of real estate related products
and services and other Internet advertisers. Increases in the volume of our
Website traffic could also strain the capacity of our existing computer systems,
which could lead to slower response times or system failures. This would cause
the number of real property search inquiries, advertising impressions, other
revenue producing offerings and our informational offerings to decline, any of
which could hurt our revenue growth and our brand loyalty. We expect that we
will incur additional costs to upgrade our computer systems in order to
accommodate increased demand if our systems cannot handle current or higher
volumes of traffic.
The recent growth in Internet traffic has caused frequent periods of
decreased performance. Our ability to increase the speed with which we provide
services to consumers and to increase the scope of these services is limited by
and dependent upon the speed and reliability of the Internet. Consequently, the
emergence and growth of the market for our services is dependent on the
performance of and future improvements to the Internet.
OUR INTERNAL NETWORK INFRASTRUCTURE COULD BE DISRUPTED.
Our operations depend upon our ability to maintain and protect our
computer systems, most of which are located at our facilities in Brea,
California and Minden, Nevada. Our systems are vulnerable to damage from
break-ins, unauthorized access, vandalism, fire, floods, earthquakes, power
loss, telecommunications failures and similar events. Although we maintain
insurance against fires, floods, and general business interruptions, the amount
of coverage may not be adequate in any particular case.
Experienced computer programmers, or hackers, may attempt to penetrate
our network security from time to time. Although we have not experienced any
material security breaches to date, a hacker who penetrates our network security
could misappropriate proprietary information or cause interruptions in our
services. We might be required to expend significant capital and resources to
protect against, or to alleviate, problems caused by hackers. We also may not
have a timely remedy against a hacker who is able to penetrate our network
security. In addition to purposeful security breaches, the inadvertent
transmission of computer viruses could expose us to litigation or to a material
risk of loss.
WE COULD FACE LIABILITY FOR INFORMATION ON OUR WEBSITE AND FOR PRODUCTS
AND SERVICES SOLD OVER THE INTERNET.
We provide third-party content on our Website, particularly real estate
listings. We could be exposed to liability with respect to this third-party
information. Persons might assert, among other things, that, by directly or
indirectly providing links to Websites operated by third parties, we should be
liable for copyright or trademark infringement or other wrongful actions by the
third parties operating those Websites. They could also assert that our third
party information contains errors or omissions, and consumers could seek damages
for losses incurred if they rely upon incorrect information.
We enter into agreements with other companies under which we share with
these other companies revenues resulting from advertising or the purchase of
services through direct links to or from our Website. These arrangements may
expose us to additional legal risks and uncertainties, including local, state,
federal and foreign government regulation and potential liabilities to consumers
of these services, even if we do not provide the services
10
<PAGE>
ourselves. We cannot assure you that any indemnification provided to us in our
agreements with these parties, if available, will be adequate.
Even if these claims do not result in liability to us, we could incur
significant costs in investigating and defending against these claims. Our
general liability insurance may not cover all potential claims to which we are
exposed and may not be adequate to indemnify us for all liability that may be
imposed.
WE FACE YEAR 2000 RELATED RISKS.
Our computer systems could have failures or miscalculations resulting
from issues with respect to the Year 2000, causing disruptions of operations,
including, among other things, a temporary inability to process searches, post
listings, track advertising or engage in similar normal business activities. Any
significant Year 2000 failure could prevent us from operating our business,
prevent users from accessing our Website or change the behavior of advertisers,
consumers or persons accessing our Website.
In addition, the parties that give us property listings may not
accurately provide date data with respect to home and commercial real estate
listings. For example, during the year 2000, a home constructed in 1900 might
inadvertently be listed on our Website as a newly built home. A significant
number of these failures could cause consumers to doubt the reliability of
information contained in our listings with a potential resulting reduction in
traffic on our Website. Any of these eventualities could adversely affect our
business, financial condition and results of operations. Presently, we cannot
reasonably estimate the duration and extent of any such interruption or quantify
the effect it could have on our future revenues. If our present efforts to
address Year 2000 issues are not successful, or if third party suppliers,
licensors and providers of hardware, software and services on which we rely do
not successfully address such issues, our business, operating results and
financial condition would be substantially harmed.
PURCHASERS OF OUR COMMON STOCK ARE SUBJECT
TO THE FOLLOWING RISKS ASSOCIATED WITH OUR COMMON STOCK.
THE MARKET PRICE FOR OUR COMMON STOCK IS LIKELY TO BE HIGHLY VOLATILE
BECAUSE THE MARKET FOR INTERNET-RELATED AND TECHNOLOGY COMPANIES IN PARTICULAR
HAS BEEN HIGHLY VOLATILE.
Investors may not be able to resell their shares of common stock
following periods of volatility because the market reacts adversely to
volatility. The trading prices of many technology and Internet-related
companies' stocks reached historical highs within the last 52 weeks and reflect
relative valuations that are substantially above historical levels.
During the same period, these companies' stocks also have recorded lows
well below historical highs. We cannot assure you that our stock will trade at
the same levels of other Internet stocks or that we can sustain our common
stock's trading price.
Many of the factors that might cause volatility in the market price of
our common stock are beyond our control. These factors may materially and
adversely affect the market price of our common stock, regardless of how we
operate.
WE ARE UNCERTAIN OF OUR ABILITY TO OBTAIN ADDITIONAL FINANCING FOR OUR
FUTURE CAPITAL NEEDS.
Our business is capital intensive, particularly with respect to product
development costs associated with the design and creation of software products,
and our plan to grow through acquisitions and strategic alliances. Accordingly,
we will require additional capital to support and expand our operations. To the
extent that revenues from operations are insufficient and additional funding is
required, public or private financing may not be available when needed or may
not be available on terms favorable or acceptable to us, if at all. Failure to
secure additional financing, if and when needed, may have a material adverse
affect on our ability to implement our proposed business strategy.
11
<PAGE>
WE MAY BE LIABLE FOR PRIOR FAILURES TO REGISTER SECURITIES IN A TIMELY
MANNER.
We have, from time to time, issued securities in private offerings and
in connection with business combination transactions and have agreed to register
those securities for subsequent public sale. We have not met our obligation to
timely register those securities. As a result, we may be liable to some of our
securityholders, which could adversely affect our business, financial condition
and results of operations. Some of these registration rights may require us to
register securities in the future. It is possible that we may not meet those
obligations, which would subject us to further liability and could adversely
affect our business, financial condition and results of operations.
ANTI-TAKEOVER PROVISIONS COULD DELAY OR PREVENT A CHANGE OF CONTROL.
Provisions of our articles of incorporation and bylaws and Nevada law,
as well as provisions in our existing employment agreements with Gregory L.
Costley, our Chairman of the Board and Chief Executive Officer, John Giaimo, our
President and Chief Operating Officer, Doug Swanson, our Vice Chairman and
Executive Vice President, and Greg Johnson, our Chief Technology Officer, could
make it more difficult for a third party to acquire us, even if doing so would
be beneficial to our stockholders.
INVESTORS SHOULD NOT PURCHASE OUR COMMON STOCK WITH THE EXPECTATION OF
RECEIVING CASH DIVIDENDS.
We currently intend to retain any future earnings for funding growth and, as a
result, do not expect to pay any cash dividends in the foreseeable future.
12
<PAGE>
THE COMPANY
Our company is known as HomeSeekers.com, Incorporated and we are a
leading provider of online residential real estate information for use by
homebuyers, real estate agents, mortgage and title insurance companies and other
individuals. Through HomeSeekers (TM) (HomeSeekers), our proprietary Internet
product available at www.HomeSeekers.com, or through HomeSeekers/CityNet (TM)
(HomeSeekers/City Net), our proprietary Intranet product, users can search for a
home within a specified geographical area and with desired features such as
number of bedrooms and baths, security, and other added features and apply for a
mortgage and title insurance.
HomeSeekers is a Nevada corporation and its principal executive offices
are located at 6490 S. McCarran Boulevard, Suite D-28, Reno, Nevada 89509,
telephone number (775) 827-6886.
USE OF PROCEEDS
All shares of common stock being offered hereby will be sold by the
selling shareholders for their own account. HomeSeekers will not receive any
proceeds from such sales. However, we may receive up to $4,028,381 in the event
all of the warrants are exercised (of which there can be no assurance). We
intend to use any proceeds received from the exercise of warrants for working
capital.
13
<PAGE>
SELLING SHAREHOLDERS
SECURITIES COVERED BY THIS PROSPECTUS
This prospectus covers a total of 6,188,619 shares of our common stock.
Of these shares, 1,945,006 shares were issued in a private offering, which was
made solely to accredited investors and completed during our fourth fiscal
quarter of 1999. In connection with such private offering, we undertook to
register the shares that were sold. An additional 4,243,613 shares were issued
as all or a portion of the consideration for several business transactions we
completed. As part of these transactions, we agreed to register the shares we
issued.
This prospectus includes 1,239,970 shares that may be issued in the
event of the exercise of warrants, at exercise prices ranging from $1.47 per
share to $6.25 per share. The warrants were issued for various business and
investment-related purposes, in connection with which we agreed to register the
shares issuable upon exercise of such warrants.
STOCK OWNERSHIP
The following table sets forth, as of December 1, 1999, the name of
each selling shareholder and the amount of shares of stock held directly or
indirectly underlying the warrants owned by the selling shareholder at the date
thereof. The table also shows the amount of shares of common stock being offered
by the selling shareholder and the amount to be owned by the selling shareholder
following the sale of all such shares of common stock.
<TABLE>
<CAPTION>
Shares Owned Shares Available Percentage of
Prior to this Pursuant to this Shares Owned Class After Material
Selling Shareholder Offering Prospectus After Offering Offering Relationship
------------------- -------- ---------- -------------- -------- ------------
<S> <C> <C> <C> <C> <C>
Stephen D. Baksa 163,168 89,834 73,334 * Consultant
Neil G. Berkman Associates 25,000 25,000 -- * Consultant
Medford Bragg 64,334 37,667 26,667 * Consultant
Ken Burns 8,250 8,250 -- * --
Cogent Alliance, Inc. 137,500 137,500 -- * --
Covenant Partners, L.P. 2,500 2,500 -- * --
Richard A. Fear 13,260 12,500 760 * --
William B. Fretz 21,125 21,125 -- * --
William B. Fretz Jr. Irrv Trust FBO Christopher
Bradlay Fretz Dated 6-26-98 10,000 10,000 -- * --
William B. Fretz Jr. Irrv Trust FBO Heather Nicole
Fretz Dated 6-26-98 5,000 5,000 -- * --
Hemlock Investments 4,300 4,300 -- * --
Lancaster Investment Partners 150,000 150,000 -- * --
Paula Peterson Runnells 8,250 8,250 -- * --
Duane R. South & Genevieve A. South 2,500 2,500 -- * --
Specialties Enterprises, LLC 156,223 110,267 45,956 * --
The Vernon Corporation 12,500 12,500 -- * --
Topaz Limited 100,000 100,000 -- * Consultant
Conrad VonBibra TTEE Edith Von Bibra Trust 38,203 37,500 703 * --
Conrad VonBibra 26,114 25,000 1,114 * --
Walker Foundation 51,989 50,000 1,989 * --
Robert Patrick White and Francis Susan White 13,094 12,500 594 * --
Alexander Hyzer 12,732 12,500 232 * --
Bradley N. Rotter Self Employed Pension Plan & Trust 333,333 333,333 -- * (1)
Point West Ventures L.P. 309,667 309,667 -- * (2)
J. Steven Emerson IRA II Bear Stearns, Trustee 93,500 -- * --
Worthington Growth, L.P. 80,000 80,000 -- * --
Losty Capital Management 200,000 200,000 -- * --
14
<PAGE>
Circle T Partners, L.P. 100,000 100,000 -- * --
American High Growth Equities Retirement Trust 50,000 50,000 -- * --
Porter Partners, L.P. 80,000 80,000 -- * --
Express Marine, Inc. 18,000 18,000 -- * --
Circle T International, LTD 50,000 50,000 -- * --
David Stone 20,000 20,000 -- * --
Richard B. Stone 65,165 65,165 -- * --
Ram-Potti 13,740 13,740 -- * --
Emmet M. Murphy 33,333 33,333 -- * --
Scott R. McQueen 15,000 15,000 -- * --
Willis Financial Planning Services, Inc. Profit
Sharing Plan, D. Vernon Willis TTEE FBO 22,667 22,667 -- * --
EDJ Limited 20,000 20,000 -- * --
Stephen R. Miraglia Trust v/a 5/28/87 12,000 12,000 -- * --
Michael C. Stead 17,000 17,000 -- * --
Gary V. Vanier & Barbara D. Vanier TTEES for the
Trust dated June 30, 1992 17,000 17,000 -- * --
William Jeffrey III 16,667 16,667 -- * --
John J. Harrison 16,667 16,667 -- * --
Jerry Heymann 11,000 11,000 -- * --
David S. Callan, IRA 15,000 15,000 -- * --
The Blake Miraglia Revocable Living Trust 8,000 8,000 -- * --
James Robert Phillips & Meredith Coleman Phillips
Revocable Trust Dates 8/23/93 10,000 10,000 -- * --
Harry Mittleman Revocable Family Trust 10,000 10,000 -- * --
McElroy EBD Trust, Edith Bogart Dagley, Trustee 1,000 1,000 -- * --
Laurence D. Keller 10,000 10,000 -- * --
Robert H. Getz 9,999 9,999 -- * --
Evan S. Malik 7,000 7,000 -- * --
Robert A. Steininger 9,000 9,000 -- * --
Christopher Allen 7,000 7,000 -- * --
Keith Fretz 7,000 7,000 -- * --
Jeffrey Steingarten 6,667 6,667 -- * --
Attilio & Ida C. Miraglia Rev Trust dated 7/31/95,
Attilio Miraglia, TTEE 3,500 3,500 -- * --
Ehud Nahum 5,000 5,000 -- * --
Constance Fretz 5,000 5,000 -- * --
Justin Tang 5,000 5,000 -- * --
George H. Getz 2,000 2,000 -- * --
Cecelia A. Miraglia Trust DTD 10/1/86, Cecelia A.
Miraglia, Trustee 4,000 4,000 -- * --
Robert R. Kesner 3,000 3,000 -- * --
Keith A. Donmoyer, IRA 2,000 2,000 -- * --
Chad Miraglia 600 600 -- * --
Eli Jacobson 27,334 27,334 -- * --
Rutgers Casualty Insurance Company 15,000 15,000 -- * --
Kentucky National Insurance Company 15,000 15,000 -- * --
Nachum Stein 5,000 5,000 -- * --
Theodore B. Smith III 5,000 5,000 -- * --
15
<PAGE>
Michail Shapiro 2,000 2,000 -- * --
Carroll Weinberg, M.D 5,000 5,000 -- * --
Charlotte C. Weinberg 5,000 5,000 -- * --
James E. Schwalbe 500 500 -- * --
David S. Callan 6,400 6,400 -- * --
Octagon Worldwide LTD 50,000 50,000 -- * Consultant
Phil A. Worack 10,000 10,000 -- * Consultant
Paul A. Schemmel 10,000 10,000 -- * Consultant
Randco, Inc. 150,000 150,000 -- * Consultant
Griffin Partners 150,000 150,000 -- * Consultant
Mihajlo Basic 26,364 25,000 1,364 * --
Renato Bautista 50,000 50,000 -- * --
Charles Billings 3,124 3,124 -- * --
David Cohen 1,444 1,000 444 * --
Donald Epstein 1,103 1,000 103 * --
Stephen Fish 5,000 5,000 -- * --
H.M. Furbee 2,146 2,000 146 * --
Stephen Gardner TTEE Gardner Fam TR of 1995 DTD
12-29-95 7,500 7,500 -- * --
Janet Gookin 1,626 1,626 -- * --
Ronald Hadan 22,500 22,500 -- * --
Ray Harbert 10,350 10,000 350 * --
Nathan Jenkins 16,500 16,500 -- * Attorney
Stephen Kapit 5,000 5,000 -- * --
Michael Kellis 10,000 10,000 -- * --
Thomas Lamb 100,000 100,000 -- * --
Randall Lazar 5,000 5,000 -- * --
Sam Maywood 10,714 10,000 714 * --
Jeff Neil 6,250 6,250 -- * --
Quantum James Harrison 6,763 6,250 513 * --
Donald Rowe 33,216 15,624 17,592 * --
Brian Salonen 6,250 6,250 -- * --
Seascape 32,161 28,522 3,639 * --
Brenda Sensenig 7,500 7,500 -- * --
Al Shankle Construction 26,300 25,000 1,300 * --
Ruth Swanson 10,000 10,000 * --
Lloyds Bahamas Securities 25,000 25,000 -- * --
David Wood 2,269 2,269 -- * --
Marvin Zayon 604 500 104 * --
Michael Allard 13,304 12,500 804 * --
Leonard Bokert 1,000 1,000 -- * --
Vasant Chheda 25,000 25,000 -- * --
Gregory Costley 3,000 3,000 -- * (3)
Harry Kouveliotes 2,000 2,000 -- * --
Tom Morgan TTEE Morgan Rev Trust UA DTD 1-4-88 12,867 12,500 367 * --
Robert Poh 25,219 12,500 12,719 * --
Jackson Spears 115,000 95,000 20,000 * Consultant
Capstone International Inc. 79,250 79,250 -- * Consultant
16
<PAGE>
William Tomerlin 643,263 127,500 515,763 3.2% Former Director
VenBanc, Inc. 27,780 27,780 -- * --
E. Andrew Sensenig, custodian for Kathryn Rae
Sensenig 2,500 2,500 -- * --
E. Andrew Sensenig, custodian for Margaret Louise
Sensenig 2,500 2,500 -- * --
Leah Alperin 30,000 30,000 -- * --
Carol Dinner 15,000 15,000 -- * (4)
Boenning & Scattergood, Inc. 75,000 75,000 -- * (5)
Gregory J. Berlacher 23,795 23,795 -- * (5)
Robert A. Berlacher 15,054 15,054 -- * (5)
Daniel C. Gardner 15,470 15,470 -- * (5)
(5)
Ronald S. Spangler 12,556 12,556 -- *
(5)
Richard Johnson 1,000 1,000 -- *
Robert A. Powers 1,000 1,000 -- * (5)
Andrea Chirieleison 500 500 -- * (5)
Alan Swerdloff 5 5 -- * (6)
John Gallagher 20,719 20,719 -- * (6)
Preston Tsao 4,466 4,466 -- * (6)
The Kelly Family Trust 151,507 16,500 135,007 * Former Director
Kathleen Farwell, Trustee of the Zoe Trust 120,000 120,000 -- * Consultant
St. Tropez Funding LTD 80,000 80,000 -- * Consultant
Lighthouse Partners USA, LP 45,000 45,000 -- * --
Lighthouse Investment Fund L.P. 45,000 45,000 -- * --
Ernich R. Ozada, IRA 20,000 20,000 -- * --
Pharos Fund Limited 140,000 140,000 -- * --
Erinch R. Ozada 95,000 95,000 -- * Consultant
Balkin Zihnali 5,000 5,000 -- * --
Terry Pullan 25,000 25,000 -- * Employee
Jaqualine J. Holloway 75,436 75,436 -- * Employee's
Spouse
Steven H. Holloway 75,436 75,436 -- * Employee
David Sherry 2,858 2,858 -- * Employee
Diane Jacobson 1,875 1,875 -- * Employee
Frank Wenzl 5,000 5,000 -- * Employee
Peter Davis 3,636 3,636 -- * Employee
Peter Krause 159,183 159,183 -- * Employee
Richard Bellamy 3,636 3,636 -- * Employee
Steven Hightower 186,977 186,977 -- * Employee
Terradatum, LLC 117,652 117,652 -- * --
Real Estate Technology Institute Inc. 28,000 28,000 -- * (7)
Dennis Gauger 10,000 10,000 -- * Consultant
John Peretz 18,100 18,100 -- * Consultant
Clifford Baird 25,000 25,000 -- * Employee
Debra Nevins 6,000 6,000 -- * Employee
BRIT&I LLC 50,000 50,000 -- * Consultant
BuySellBid.com, Inc. 507,615 507,615 -- * --
Mark A. Spraetz 37,301 37,301 -- * Employee
D. Lynn Spraetz 37,301 37,301 -- * Employee's
Spouse
Dawn Bertsche, TTEE Spraetz Children's Trust 6,488 6,488 -- * Employee's Trust
-------------------------
Total 7,050,897 6,188,619
</TABLE>
17
<PAGE>
* less than one percent
(1) Mr. Rotter is a Director of the Company.
(2) Mr. Bradley N. Rotter, a Director of the Company, is the chairman of
Point West Ventures, L.P.
(3) Mr. Costley is the Chairman of the Board, Chief Executive Officer and
a Director of the Company.
(4) Boenning & Scattergood, Inc. acted as Placement Agent in connection
with the Company's Private Placement dated December 8, 1998.
(5) Employees of Boenning & Scattergood, Inc. who acted as Placement
Agent in connection with the Company's Private Placement dated
December 8, 1998.
(6) Employees of Sunrise Securities, Inc. who acted as Placement Agent in
connection with the Company's Private Placement dated December 8,
1998.
(7) Real Estate Technology Institute, Inc. is controlled by Kevin McCarthy
who is an employee of the company.
We have agreed to pay full costs and expenses in connection with the
issuance, offer, sale and delivery of the shares, including but not limited to,
all fees and expenses in preparing, filing and printing the registration
statement and prospectus and related exhibits, amendments and supplements
thereto and mailing of such items. We will not pay selling commissions and
expenses associated with any sale by the selling shareholders.
Beneficial ownership is determined in accordance with rules promulgated
by the Securities and Exchange Commission, and the information is not
necessarily indicative of beneficial ownership for any other purpose. As of
December 1, 1999, we believe that each person named in the table has sole voting
and investment power with respect to all of the shares of our common stock
listed as beneficially owned by it. The information contained in the foregoing
table is derived from the books and records of the Company, as well as the
Company's transfer agent.
The selling shareholders identified above may have sold, transferred or
otherwise disposed of all or a portion of such securities since December 1, 1999
in transactions exempt from the registration requirements of the Securities Act
of 1933. The selling shareholders may sell all, part or none of the shares of
common stock listed above.
Generally, only selling shareholders indentified in the foregoing table
who beneficially own the shares of common stock set forth opposite their
respective names may sell such offered shares pursuant to the Registration
Statement of which this prospectus forms a part. We may from time to time
include additional selling shareholders in supplements to this prospectus.
18
<PAGE>
PLAN OF DISTRIBUTION
The shares offered hereby may be sold from time to time by the selling
shareholders, or by pledgees, donees, transferees or other successors in
interest. Such sales may be made on one or more exchanges or in the
over-the-counter market (including the Nasdaq SmallCap Market of The Nasdaq
Stock Market), 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 methods:
(a) a block trade in which the broker-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;
(b) purchases by a broker or dealer as principal and
resale by such broker or dealer for its account
pursuant to this prospectus;
(c) ordinary brokerage transactions and transactions in
which the broker solicits purchasers; and
(d) face-to-face or other direct transactions between the
selling shareholders and purchasers without a
broker-dealer or other intermediary.
In effecting sales, brokers or dealers engaged by the selling
shareholders may arrange for other brokers or dealers to participate in the
resales. Brokers, dealers or agents may receive compensation in the form of
commissions, discounts or concessions from selling shareholders in amounts to be
negotiated in connection with the sale. Such broker-dealers and agents and any
other participating broker-dealers or agents may be deemed to be "underwriters"
within the meaning of the Securities Act of 1933, in connection with such sales.
In addition, any securities covered by this prospectus that qualify for sale
pursuant to Rule 144 of the Securities Act of 1933 might be sold under Rule 144
rather than pursuant to this prospectus.
In connection with distributions of the shares or otherwise, the
selling shareholders may enter into hedging transactions with broker-dealers. In
connection with such transactions, broker-dealers may engage in short sales of
the shares registered hereunder in the course of hedging the positions they
assume with selling shareholders. The selling shareholders may also sell shares
short and deliver the shares to close out such short positions. The selling
shareholders may also enter into option or other transactions with
broker-dealers which require the delivery to the broker-dealer of the shares
registered hereunder, which the broker-dealer may resell pursuant to this
prospectus. The selling shareholders may also pledge the shares registered
hereunder to a broker or dealer and upon a default, the broker or dealer may
effect sales of the pledged shares pursuant to this prospectus.
Information as to whether an underwriter(s) who may be selected by the
selling shareholders, or any other broker-dealer, is acting as principal or
agent for the selling shareholders, the compensation to be received by
underwriters who may be selected by the selling shareholders, or any
broker-dealer, acting as principal or agent for the selling shareholders and the
compensation to be received by other broker-dealers, in the event the
compensation of such other broker-dealers is in excess of usual and customary
commissions, will, to the extent required, be set forth in a supplement to this
prospectus. Any dealer or broker participating in any distribution of the shares
may be required to deliver a copy of this prospectus to any person who purchases
any of the shares from or through such dealer or broker.
We have advised the selling shareholders that during such time as they
may be engaged in a distribution of the shares included herein they are required
to comply with Regulation M promulgated under the Securities Exchange Act of
1934. With certain exceptions, Regulation M precludes any selling shareholders,
any affiliated purchasers and any broker-dealer or other person who participates
in such distribution from bidding for or purchasing, or attempting to induce any
person to bid for or purchase any security which is the subject of the
distribution until the entire distribution is complete. Regulation M also
prohibits any bids or purchases made in order to stabilize the price of a
security in connection with the distribution of that security. All of the
foregoing may affect the marketability of our common stock.
It is anticipated that the selling shareholders will offer all of the
shares for sale. Further, because it is possible that a significant number of
shares could be sold at the same time hereunder, such sales, or the possibility
thereof, may have a depressive effect on the market price of our common stock.
Except as specifically set forth herein, none of the selling
shareholders has, or within the past three years has had, any position, office
or other material relationship with us or any of our predecessors or affiliates.
19
<PAGE>
LEGAL MATTERS
The validity of the issuance of the securities offered hereby will be
passed upon for us by Jenkins & Carter, Reno, Nevada. Jones, Day, Reavis, &
Pogue, Chicago, Illinois and Cleveland, Ohio from time to time acts as counsel
for HomeSeekers and its subsidiaries.
EXPERTS
The financial statements of HomeSeekers as of June 30, 1999 and 1998,
and for each of the two fiscal years in the period ended June 30, 1999,
incorporated by reference into this prospectus, have been audited by Albright,
Persing & Associates, Limited, independent certified public accountants to the
extent and for the periods set forth in their report, and are incorporated by
reference herein in reliance upon such report given upon the authority of said
firm as experts in accounting and auditing.
INDEMNIFICATION
The Nevada General Corporation Law allows a corporation to indemnify
any person who was or is threatened to be made a party to any threatened,
pending or completed suit or proceeding. This applies whether the matter is
civil, criminal, administrative or investigative because he or she is or was a
director, officer, employee or agent of the corporation. In addition, a Nevada
corporation may indemnify against expenses, including attorney's fees, and,
except for an action by or in the name of the corporation, against judgments,
fines and amounts paid in settlement as part of such suit or proceeding. This
applies only if the person indemnified acted in good faith and in a manner he or
she reasonably believed to be in the best interest of the corporation, and, with
respect to any criminal action or proceeding, the person had no reasonable cause
to believe his or her conduct was unlawful.
In the case of an action by or in the name of the corporation, no
indemnification of expenses may be made for any claim as to which the person has
been found to be liable to the corporation. The exception is if the court in
which such action was brought determines that the person is reasonably entitled
to indemnity for expenses.
The Nevada General Corporation Law further provides that if a director,
officer, employee or agent of the corporation has been successful in the defense
of any suit, claim or proceeding described above, he or she will be indemnified
for expenses, including attorneys' fees, actually and reasonably incurred by him
or her.
Our by-laws provide that our officers and directors shall be
indemnified and held harmless to the fullest extent legally permissible under
Nevada General Corporation Law from time to time. Such right of indemnification
shall be a contract right which may be enforced in any manner desired by such
person. In addition, we have procured officers and directors liability insurance
providing for coverage in the aggregate amount of $3,000,000.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 is permitted as to our directors, officers and controlling persons,
in the opinion of the Securities and Exchange Commission, such indemnification
is against public policy and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities, other than our payment in
the successful defense of any action, suit or proceeding, is asserted, we will,
unless in the opinion of our counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by us is against public policy. We will be governed by the
final adjudication of such issue.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements,
information statements and other information with the Securities and Exchange
Commission. You may read and copy any reports, statements or other information
that we file with the Securities and Exchange Commission at the public reference
facilities the Securities and Exchange Commission maintains at:
20
<PAGE>
Room 1024, Judiciary Plaza
450 Fifth Street, N.W.
Washington, DC 20549
and at the Securities and Exchange Commission's Regional Offices
located at:
<TABLE>
<CAPTION>
<S> <C>
Chicago Regional Office New York Regional Office
Citicorp Center 13th Floor, Seven World Trade Center
Suite 1400, Northwestern Atrium Center New York, NY 10048
500 West Madison Street
Chicago, IL 60661
</TABLE>
and you may also obtain copies of such material by mail from the Public
Reference Section of the Securities and Exchange Commission at:
Public Reference Room
450 Fifth Street, N.W.
Washington, DC 20549
at prescribed rates. Please call the Securities and Exchange Commission at
1-800-SEC-0330 for further information on the public reference rooms.
The Securities and Exchange Commission also maintains a Web site on the
World Wide Web, the address of which is http://www.sec.gov. That site also
contains our Securities and Exchange Commission filings. Our Securities and
Exchange Commission filings and other information concerning us may also be
inspected at the offices of the Nasdaq Stock Market, Reports Section, at:
1735 K Street, N.W.
Washington, DC 20006
This prospectus is part of a Registration Statement filed by us with
the Securities and Exchange Commission. It does not contain all the information
included or incorporated by reference in the Registration Statement. The full
Registration Statement can be obtained from the Securities and Exchange
Commission as indicated above or from us.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" information from other documents that we file with them, which means
that we can disclose important information to you by referring to those
documents. The information incorporated by reference is considered to be a part
of this prospectus, and information that we file later with the Securities and
Exchange Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
make with the Securities and Exchange Commission under Sections 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934 prior to the sale of all the
shares of common stock covered by this prospectus:
o Annual Report on Form 10-KSB for the year ended June 30, 1999.
o Quarterly Report on Form 10-QSB for the quarter ended September
30, 1999.
o Amendment to the Quarterly Report on Form 10-QSB/A for the
quarter ended September 30, 1999.
o Current Report on Form 8-K filed with the Securities and Exchange
Commission on August 6, 1999.
o Current Report on Form 8-K filed with the Securities and Exchange
Commission on October 5, 1999.
o Current Report on Form 8-K filed with the Securities and Exchange
Commission on October 15, 1999.
o Amendment to the Quarterly Report on Form 8-K/A filed with the
Securities and Exchange Commission on December 1, 1999.
o The description of our common stock contained in Amendment No. 3
to our registration statement on Form 10-SB, Commission File No.
000-23835, as filed with the Securities and Exchange Commission
on October 6, 1998.
21
<PAGE>
You may request a copy of these filings, at no cost, by writing or
telephoning us using the following contact information:
Chief Financial Officer
HomeSeekers.com, Incorporated
6490 South McCarran Boulevard, Suite D-28
Reno, Nevada 89509
(775) 827-6886
You should rely only on the information incorporated by reference,
provided in this prospectus or any supplement or that we have referred you to.
We have not authorized anyone else to provide you with different information.
You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date on the front of those documents.
However, you should realize that the affairs of HomeSeekers may have changed
since the date of this prospectus. This prospectus will not reflect such
changes. You should not consider this prospectus to be an offer or solicitation
relating to the securities in any jurisdiction in which such an offer or
solicitation relating to the securities is not authorized. Furthermore, you
should not consider this prospectus to be an offer or solicitation relating to
the securities if the person making the offer or solicitation is not qualified
to do so, or if it is unlawful for you to receive such an offer or solicitation.
22
<PAGE>
We have not authorized any person to make a statement that differs from
what is in this prospectus. If any person does make a statement that differs
from what is in this prospectus, you should not rely on it. This prospectus is
not an offer to sell, nor is it seeking an offer to buy, these securities in any
state in which the offer or sale is not permitted. The information in this
prospectus is complete and accurate as of its date, but the information may
change after that date.
HOMESEEKERS.COM, INCORPORATED
6,188,619 SHARES
OF COMMON STOCK
-----------------------
PROSPECTUS
-----------------------
_________________, 1999
23
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the costs and expenses in connection
with the sale and distribution of the common stock being registered, other than
underwriting discounts and commissions. All amounts shown are estimates except
the Securities and Exchange Commission registration fee.
Securities and Exchange Commission registration fee............. $ 7,233
Legal fees and expenses......................................... 20,000
Accounting fees and expenses.................................... 22,000
Financial printing.............................................. 10,000
Transfer agent fees............................................. 3,000
Blue sky fees and expenses...................................... 3,000
Miscellaneous................................................... 4,767
--------
TOTAL................................................. $ 70,000
None of the foregoing expenses are being paid by the selling shareholders.
Item 15. Indemnification of Directors and Officers.
Section 78.751 of the Nevada General Corporation Law, provides as
follows:
1. A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact
that he is or was a Director, officer, employee or agent of the corporation, or
is or was serving at the request of the corporation as a Director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses, including attorneys' fees, judgments, fines
and amounts paid in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted in good faith and in
a manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent, does not, of
itself, create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and that, with respect to any criminal action or
proceeding, he had reasonable cause to believe that his conduct was unlawful.
2. A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that he is or was a Director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
Director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses, including amounts paid in
settlement and attorneys' fees actually and reasonably incurred by him in
connection with the defense or settlement of the action or suit if he acted in
good faith and in a manner which he reasonably believed to be in or not opposed
to the best interests of the corporation. Indemnification may not be made for
any claim, issue or matter as to which such a person has been adjudged by a
court of competent jurisdiction, after exhaustion of all appeals therefrom, to
be liable to the corporation or for amounts paid in settlement to the
corporation, unless and only to the extent that the court in which the action or
suit was brought or other court of competent jurisdiction determines upon
application that in view of all the circumstances of the case, the person is
fairly and reasonably entitled to indemnity for such expenses as the court deems
proper.
3. To the extent that a Director, officer, employee or agent of a
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections 1 and 2, or in defense of
any claim, issue or matter therein, he must be indemnified by the corporation
against expenses, including attorneys' fees, actually and reasonably incurred by
him in connection with the defense.
4. Any indemnification under subsections 1 and 2, unless ordered by a
court or advanced pursuant to subsection 5, must be made by the corporation only
as authorized in the specific case upon a determination that
24
<PAGE>
indemnification of the Director, officer, employee or agent is proper under the
circumstances. The determination must be made:
(a) By the stockholders;
(b) By the board of Directors by majority vote of a
quorum consisting of Directors who were not parties
to the act, suit or proceeding;
(c) If a majority vote of a quorum consisting of
Directors who were not parties to the act, suit or
proceeding so orders, by independent legal counsel in
a written opinion; or
(d) If a quorum consisting of Directors who were not
parties to the act, suit or proceeding cannot be
obtained, by independent legal counsel in a written
opinion.
5. The articles of incorporation, the bylaws or an agreement made by
the corporation may provide that the expenses of officers and Directors incurred
in defending a civil or criminal action, suit or proceeding must be paid by the
corporation as they are incurred and in advance of the final disposition of the
action, suit or proceeding, upon receipt of an undertaking by or on behalf of
the Director or officer to repay the amount if it is ultimately determined by a
court of competent jurisdiction that he is not entitled to be indemnified by the
corporation. The provisions of this subsection do not affect any rights to
advancement of expenses to which corporate personnel other than Directors or
officers may be entitled under any contract or otherwise by law.
6. The indemnification and advancement of expenses authorized in or
ordered by a court pursuant to this section:
(a) Does not exclude any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under
the articles of incorporation or any bylaw, agreement, vote of
stockholders or disinterested Directors or otherwise, for either
an action in his official capacity or an action in another
capacity while holding his office, except that indemnification,
unless ordered by a court pursuant to subsection 2 or for the
advancement of expenses made pursuant to subsection 5, may not
be made to or on behalf of any Director or officer if a final
adjudication establishes that his acts or omissions involved
intentional misconduct, fraud or a knowing violation of the law
and was material to the cause of action.
(b) Continues for a person who has ceased to be a Director, officer,
employee or agent and inures to the benefit of the heirs,
executors and administrators of such a person.
Article IX of the Company's Revised Bylaws provides as follows:
Every person who was or is a party or is threatened to be made a party
to or is involved in any action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that he or a person of
whom he is the legal representative is or was a director or officer of the
Corporation or is or was serving at the request of the Corporation or for its
benefit as a director or officer of another corporation, or as its
representative in a partnership, joint venture, trust or other enterprise, shall
be indemnified and held harmless to the fullest extent legally permissible under
the General Corporation Law of the State of Nevada from time to time against all
expenses, liability and loss (including attorneys' fees, judgments, fines and
amounts paid or to be paid in settlement) reasonably incurred or suffered by him
in connection therewith. Such right of indemnification shall be a contract right
which may be enforced in any manner desired by such person. Such right of
indemnification shall not be exclusive of any other right which such directors,
officers or representatives may have or hereafter acquire and, without limiting
the generality of such statement, they shall be entitled to their respective
rights of indemnification under any by-law, agreement, vote of Shareholders,
provision of law or otherwise, as well as their rights under this Article.
The Board of Directors may cause the Corporation to purchase and
maintain insurance on behalf of any person who is or was a Director or officer
of the Corporation, or is or was serving at the request of the Corporation as a
director or officer of another corporation, or as its representative in a
partnership, joint venture, trust or other enterprise against any liability
asserted against such person and incurred in any such capacity or arising out of
such status, whether or not the Corporation would have the power to indemnify
such person.
The indemnification provisions above provided shall include, but not be
limited to, reimbursement of all fees, including amounts paid in settlement and
attorneys' fees actually and reasonably incurred, in connection with the defense
or settlement of any action or suit if such party to be indemnified acted in
good faith and in a manner reasonably believed to
25
<PAGE>
be in or not opposed to the best interests of the Corporation. Indemnification
may not be made for any claim, issue or matter as to which the person claiming
indemnity has been adjudged by a court of competent jurisdiction, after
exhaustion of all appeals therefrom to be liable to the Corporation or for
amounts paid in settlement to the Corporation unless and only to the extent that
the court in which the action or suit was brought or other court of competent
jurisdiction determines upon application that the person is fairly and
reasonably entitled to indemnify for such expenses as the court deems proper.
In accordance with the foregoing, the Company has obtained officers and
directors liability insurance with an aggregate coverage of $3,000,000.
Item 16. Exhibits.
See exhibit index.
Item 17. Undertakings.
A. The undersigned registrant hereby undertakes to:
(1) File, during any period in which it offers or sells
securities, a post-effective amendment to this registration
statement to:
(i) Include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental
change in the information in the registration
statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered
(if the total dollar value of securities offered
would not exceed that which was registered) and any
deviation from the low or high end of the estimated
maximum offering range may be reflected in the form
of prospectus filed with the Commission under Rule
424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the
effective registration statement:
(iii) Include any additional or changed material
information on the plan of distribution;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by
the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in
the registration statement.
(2) For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of
the securities offered, and the offering of the securities at
that time to 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. The undersigned registrant hereby undertakes to, for determining any
liability under the Securities Act, treat each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d)
of the Securities Exchange Act of 1934 that is incorporated by
reference in the registration statement as a new registration statement
of the securities offered, and the offering of the securities at that
time as the initial bona fide offering of those securities.
C. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that, in the opinion of the 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.
26
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
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 Reno and the State of Nevada, on the 3rd day of
December, 1999.
HOMESEEKERS.COM, INCORPORATED
By: /s/ Gregory L. Costley
----------------------------------------
Gregory L. Costley, Chairman and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ Gregory L. Costley Chairman of the Board, Chief December 3, 1999
- ------------------------------------ Executive Officer and Director
Gregory L. Costley (Principal Executive Officer)
/s/ James A. Dykstra Chief Financial Officer December 3, 1999
- ------------------------------------ (Principal Accounting Officer)
James A. Dykstra
/s/ John Giaimo President, Chief Operating Officer December 3, 1999
- ------------------------------------ and Director
John Giaimo
/s/ Doug Swanson Vice Chairman of the Board, December 3, 1999
- ------------------------------------ Executive Vice President and
Doug Swanson Director
/s/ Greg Johnson Chief Technology Officer December 3, 1999
- ------------------------------------ and Director
Greg Johnson
/s/ Bradley N. Rotter Director December 3, 1999
- ------------------------------------
Bradley N. Rotter
/s/ David Holmes Director December 3, 1999
- ------------------------------------
David Holmes
* The undersigned, by signing his name hereto, does hereby sign and execute this
Registration Statement pursuant to the Power of Attorney executed by the
above-named officers and directors of the Registrant and which has been filed
with the Securities and Exchange Commission on behalf of such officers and
directors.
/s/ Gregory L. Costley December 3, 1999
- ------------------------------------
Gregory L. Costley, Attorney-in-Fact
</TABLE>
27
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Description of Document
5.1 Opinion of Jenkins & Carter
23.1 Consent of Jenkins & Carter (see Exhibit 5.1)
23.2 Consent of Albright, Persing & Associates, Limited
24.1 Power of Attorney executed by officers and directors of
HomeSeekers.com, Incorporated
28
December 2, 1999
HomeSeekers.com, Incorporated
2241 Park Place, Suite E
Minden, NV 89423
Re: Opinion and Consent of Jenkins & Carter Registration Statement
on Form S-3; HomeSeekers.com, Incorporated (the "Company")
Gentlemen:
This opinion is submitted pursuant to the applicable rules of the
Securities Exchange Commission with respect to the registration for public sale
of 6,188,619 shares (the "Registerable Shares") of common stock, $.001 par value
(the "Common Stock"), including up to 1,239,970 shares of Common Stock reserved
for issuance upon exercise of certain outstanding warrants (the "Reserved
Shares").
In connection therewith, we have examined and relied upon original,
certified, conformed, photostat or other copies of (i) the Articles of
Incorporation, as amended, and Bylaws of the Company; (ii) resolutions of the
Board of Directors of the Company authorizing the offering and the issuance of
the Common Stock and related matters; (iii) the Registration Statement and the
exhibits thereto; and (iv) such other matters of law as we have deemed necessary
for the expression of the opinion herein contained.
Based upon the foregoing, we are of the opinion that: (i) the currently
outstanding Registerable Shares have been legally issued and are fully paid and
non-assessable; and (ii) the Reserved Shares, when issued and upon payment of
the agreed upon consideration therefore, will be legally issued, fully paid and
non-assessable if all terms and conditions of the applicable warrants are
complied with.
The opinions set forth above are subject to the following
qualifications:
(a) We have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals,
the conformity to the originals of all documents submitted to
<PAGE>
HomeSeekers.com, Incorporated
December 2, 1999
Page -2-
us as copies and the authenticity of the originals of all such
latter documents. We have also assumed the accuracy of the
factual matters contained in the documents we have examined.
(b) Where documents delivered to us by the Company and its
representatives state that the officers and directors of the
Company have taken actions with respect to the Registerable
Shares or the Reserved Shares, we have assumed that such
actions have been taken.
(c) We have assumed the due execution and delivery for value of
all agreements pertaining to the Registerable Shares and the
Reserved Shares by the holders of such shares, other than the
Company.
(d) We have relied (to the extent we have no contrary knowledge),
without investigation, as to matters of fact upon certificates
furnished by officers of the Company whose positions and
authority would reasonably require them to have knowledge of
the facts certified, and by public officials, and search
reports of recognized search companies.
(e) We are qualified to practice law in the State of Nevada and
have not made a special examination of any law other than the
law of the State of Nevada. Accordingly, in connection with
the rendering of this opinion, we express no opinion as to the
laws of any state, or as to any matter subject to such laws,
other than the current laws of the State of Nevada. We have
assumed that, if and where applicable, laws of other states
are the same as the laws of the State of Nevada.
(f) Our opinion is limited to matters expressly set forth herein
and no opinion is to be implied or inferred beyond the matters
expressly so stated.
(g) Our opinion is subject to and limited by (i) all applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or similar laws affecting the enforcement of
creditors' rights generally; (ii) all rights which may inhere
in the Internal Revenue Service or any state or local taxing
authorities under the tax laws of the United States of America
and the several states; and (iii) general equitable principles
regardless of whether such enforceability is considered in a
proceeding at law or in equity.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to use our name under the caption "Legal Matters" in
the prospectus comprising part of the Registration Statement. However, this
opinion is furnished only for your benefit and may not be relied upon by any
other person or entity without our
<PAGE>
HomeSeekers.com, Incorporated
December 2, 1999
Page -3-
express prior written consent. This opinion speaks only as of the date hereof
and is limited to present statutes, laws and regulations and to the facts as
they currently exist, and we have assumed no obligation to update or supplement
this opinion.
Sincerely yours,
/s/ Jerry C. Carter
INDEPENDENT AUDITORS' CONSENT
We consent to the use in the Registration Statement of HomeSeekers.com,
Incorporated on Form S-3 of our report dated July 22, 1999 and August 4, 1999 on
the consolidated balance sheets of HomeSeekers.com, Incorporated as of June 30,
1999 and 1998, and the related statements of operations, stockholders' deficit
and cash flows for the years then ended.
We also consent to the reference to us under the heading "Experts" in
such Registration Statement.
/s/ Albright, Persing Associates, Ltd.
- --------------------------------------------
ALBRIGHT, PERSING ASSOCIATES, LTD.
Reno, Nevada
December 2, 1999
31
OFFICERS AND DIRECTORS OF
HOMESEEKERS.COM, INCORPORATED
POWER OF ATTORNEY
The undersigned officers and/or directors of HomeSeekers.com, Incorporated (the
"Company") hereby constitute and appoint Gregory L. Costley, Doug Swanson and
Jim Dykstra, or any of them, with full power of substitution and resubstitution,
as attorneys or attorney of the undersigned, to sign and file under Securities
Act of 1933, as amended, (i) a registration statement on Form S-3 relating to
the registration of shares of the Company's common stock, (ii) any registration
statement related to the offering which is effective immediately upon filing
pursuant to Rule 462(b) under said Act, and (iii) any and all amendments and
exhibits to such registration statement, including post-effective amendments,
and any and all applications or other documents to be filed with the Securities
and Exchange Commission pertaining to such registration statements or
amendments, with full power and authority to do and perform any and all acts and
things whatsoever required and necessary to be done in the premises, hereby
ratifying the acts of said attorney and any of them and any such substitute.
EXECUTED this 19th day of November, 1999.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Gregory L. Costley Chairman of the Board, Chief November 19, 1999
- ------------------------------------ Executive Officer and Director
Gregory L. Costley (Principal Executive Officer)
/s/ James A. Dykstra Chief Financial Officer November 19, 1999
- ------------------------------------ (Principal Accounting Officer)
James A. Dykstra
/s/ John Giaimo President, Chief Operating Officer November 19, 1999
- ------------------------------------ and Director
John Giaimo
/s/ Doug Swanson Vice Chairman of the Board, November 19, 1999
- ------------------------------------ Executive Vice President and
Doug Swanson Director
/s/ Greg Johnson Chief Technical Officer November 19, 1999
- ------------------------------------ and Director
Greg Johnson
/s/ Larry Ross Vice President - Marketing November 19, 1999
- ------------------------------------
Larry Ross
/s/ Bradley N. Rotter Director November 19, 1999
- ------------------------------------
Bradley N. Rotter
/s/ David Holmes Director November 19, 1999
- ------------------------------------
David Holmes
</TABLE>
32
