As filed with the Securities and Exchange Commission on
October 4, 2010August 11, 2020.Registration No.
____________333-UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
ORIGINAL SOURCE ENTERTAINMENT, INC. (ExactNeuroOne Medical Technologies Corporation
(Exact name of
Registrantregistrant as specified in its charter)
Delaware | 3841 | 27-0863354 | ||
(State or other jurisdiction of | (Primary Standard Industrial | (I.R.S. Employer | ||
incorporation or organization) | Classification | Identification No.) |
7599 Anagram Dr., Eden Prairie, MN 55344
952-426-1383
(Address, including zip code, and telephone number, including area code, of Registrant'sregistrant’s principal executive offices)
Lecia L. Walker
Original Source Entertainment, Inc.
8201 South Santa Fe Drive #229
Littleton, Colorado 80120
Telephone: 303-495-3728
(Name,
David Rosa
7599 Anagram Dr., Eden Prairie, MN 55344
952-426-1383
(Name, address, including zip code, and telephone number, including area code, of agent for service)
With copies to:
Jody M. Walker
Attorney at Law
7841 S. Garfield
Phillip D. Torrence, Esq.
Emily J. Johns, Esq.
Honigman LLP
650 Trade Centre Way, Centennial, Colorado 80122
Telephone: (303)850-7637
Facsimile: (303)482-2731
Suite 200
Kalamazoo, MI 49002
Phone: (269) 337-7702
Fax: (269) 337-7703
Approximate date of commencement of proposed sale to the public: From
time to timeAs soon as practicable after the effective date of this registration statement.
Registration Statement.
If any of the securities being registered on this formForm are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, please check the following box: [x]
☒
If this formForm is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
☐
If this formForm 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. [ ]
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☐
If this formForm is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box: [ ]
☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a nonnon-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.:
Large accelerated filer ☐ | Accelerated filer ☐ | Non-accelerated filer ☒ | Smaller reporting company ☒ |
Emerging growth company ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or a small
reporting company.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [x]
revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
CALCULATION OF REGISTRATION FEE
Title of Each Class of Securities to be Registered | Amount to be Registered(1) | Proposed Maximum Offering Price Per Share(2) | Proposed Maximum Aggregate Offering Price(1) | Amount of Registration Fee | ||||||||||||
Common stock, par value $0.001 per share | 10,883,808 | $ | 1.80 | $ | 19,590,854.40 | $ | 2,542.89 |
(1) | Pursuant to Rule 416 under the Securities Act of 1933, as amended (the “Securities Act”), this registration statement also covers any additional number of additional shares of common stock issuable upon stock splits, stock dividends, dividends or other distribution, recapitalization or similar events with respect to the shares of common stock being registered pursuant to this registration statement. |
(2) | Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(c) under the Securities Act, using the average of the high and low prices of our common stock as reported on the OTCQB on August 4, 2020, a date within five business days prior to the date of filing of this registration statement. |
The registrantRegistrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrantRegistrant 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, as amended, or until thisthe registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.3
Preliminary Prospectus Dated October 4, 2010
Subject to Completion
Original Source Entertainment, Inc.
$500,000
Up to a Maximum of 10,000,000
Common Shares at $0.05 Per Common Share
We are offering for sale a maximum of 10,000,000 common shares at a
price of $0.05 per share.
There is no minimum amount of shares that we must sell in our direct
offering, and therefore no minimum amount of proceeds will be raised.
No arrangements have been made to place funds into escrow or any
similar account.
We are also registering 1,500,000 common shares on behalf of selling
security holders. We will not receive any cash or other proceeds in
connection with the subsequent sale by the selling security holders.
The 1,500,000 common shares included in this prospectus may be offered
and sold directly by the selling security holders. The selling
security holders must sell at a fixed price of $.05 until our shares
are quoted on a market or securities exchange. Thereafter, the selling
security holders may sell at prevailing prices or privately negotiated
prices. We will not control or determine the price at which a selling
security holder decides to sell its shares. Brokers or dealers
effecting transactions in these shares should confirm that the shares
are registered under applicable state law or that an exemption from
registration is available.
The primary offering will commence on the effective date of this
prospectus and will terminate on or before December 31, 2011. In our
sole discretion, we may terminate the primary offering before all of
the common shares are sold. The secondary offering by selling
shareholders shall commence upon termination of the primary offering.
There is no market for our securities. Our common stock is presently
not traded on any market or securities exchange and we have not applied
for listing or quotation on any public market.
Consider carefully the risk factors beginning on page 7 in this
prospectus.
Neither the SEC nor any state securities commission has approved these
common shares or determined that this prospectus is accurate or
complete. Any representation to the contrary is a criminal offense.
The information in this prospectus is not complete and may be changed. WeThe selling stockholders may not sell these securities under this prospectus until the registration statement of which it is a part and filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.4
Proceeds
PRELIMINARY PROSPECTUS, SUBJECT TO COMPLETION, DATED AUGUST 11, 2020
NeuroOne Medical Technologies Corporation
10,883,808 Shares of Common Stock Offered by Selling Stockholders
This prospectus relates to the public offering of up to 10,883,808 shares of common stock of NeuroOne Medical Technologies Corporation (the “Company”) by the selling stockholders listed on page 9 (the “Selling Stockholders”), which includes (i) 8,005,428 outstanding shares of our common stock, par value $0.001 per share (the “Common Stock”) and (ii) an aggregate of 2,878,380 shares of Common Stock issuable upon the exercise of certain warrants. We are registering these shares on behalf of the Offering
Per Common Share Total
Offering Price $.05 $500,000
ProceedsSelling Stockholders, to Original Source,
before expenses $.05 $500,000
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TABLE OF CONTENTS
Prospectus Summary 6
Risk Factors 7
Forward Looking Statements 12
Planbe offered and sold by them from time to time.
We are not selling any securities under this prospectus and we will not receive proceeds from the sale of Distribution and Selling Security Holders 13
Business Operations 16
Use of Proceeds 19
Determination of Offering Price 20
Dilution 20
Dividend Policy 21
Management's Discussion and Analysis of Financial
Condition and Results of Operations 22
Directors, Executive Officers Control Persons 24
Security Ownership of Certain Beneficial Owners
and Management 27
Certain Relationships and Related Transactions 28
Description of Capital Stock 29
Shares Eligible for Future Sale 30
Disclosure of Commission Position on Indemnification 31
for Securities Act liabilities
Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure 31
Market for Common Stock by the Selling Stockholders. However, we may receive proceeds from the cash exercise of the warrants, which, if exercised in cash at the current applicable exercise price with respect to all of the 2,878,380 shares of Common Stock, would result in gross proceeds to the Company of $5,382,570.60.
We will pay the expenses of registering the shares of Common Stock offered by this prospectus, but all selling and Relatedother expenses incurred by each Selling Stockholder Matters 32
Experts 33
Legal Proceedings 33
Legal Matters 33
Wherewill be paid by such Selling Stockholder. The Selling Stockholders may sell the shares of our Common Stock offered by this prospectus from time to time on terms to be determined at the time of sale through ordinary brokerage transactions or through any other means described in this prospectus under “Plan of Distribution.” The prices at which the Selling Stockholders may sell shares will be determined by the prevailing market price for shares of our Common Stock or in negotiated transactions.
Investing in our Common Stock involves a high degree of risk. You Can Find More Information 34
Financial Statements 35
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PROSPECTUS SUMMARY
To understand this offering fully, you should read the entire
prospectusconsider carefully including the risk factors beginning on page 6 of this prospectus and in our Annual Report on Form 10-K for the year ended September 30, 2019 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, as well as the information included or incorporated by reference in this prospectus before purchasing any of the shares offered by this prospectus.
Our Common Stock is quoted on the OTCQB and trades under the symbol “NMTC.” The last reported sale price of our Common Stock on the OTCQB on August 4, 2020 was $1.80 per share.
We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read the entire prospectus and any amendments or supplements carefully before you make your investment decision.
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.
The date of this prospectus is , 2020
NEUROONE MEDICAL TECHNOLOGIES CORPORATION
TABLE OF CONTENTS
You may only rely on the information contained in this prospectus or that we have referred you to. We have not authorized anyone to provide you with different information. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities other than the Common Stock offered by this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any Common Stock in any circumstances in which such offer or solicitation is unlawful. Neither the delivery of this prospectus nor any sale made in connection with this prospectus shall, under any circumstances, create any implication that there has been no change in our affairs since the date of this prospectus or that the information contained by reference to this prospectus is correct as of any time after its date.
This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (“SEC”). It omits some of the information contained in the registration statement and reference is made to the registration statement for further information with regard to us and the securities being offered. You should review the information and exhibits in the registration statement for further information about us and the securities being offered hereby. Statements in this prospectus concerning any document we filed as an exhibit to the registration statement or that we otherwise filed with the SEC are not intended to be comprehensive and are qualified by reference to the filings. You should review the complete document to evaluate these statements.
You should read this prospectus, any documents that we incorporate by reference in this prospectus and the additional information described under the sections entitled “Where to Find Additional Information” and “Incorporation of Certain Information by Reference” before making an investment decision. You should rely only on the information contained or incorporated by reference in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with additional, different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
You should not assume that the information in this prospectus or any documents we incorporate by reference herein is accurate as of any date other than the date on the front of such document. Our business, financial statements.
General Original Source Entertainment, Inc.condition, results of operations and prospects may have changed since those dates.
i
This summary highlights information contained in other parts of this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our Common Stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information included or incorporated by reference in this prospectus. You should read the entire prospectus carefully, especially “Risk Factors” and our filings incorporated by reference herein to which we have referred you in the sections “Where You Can Find Additional Information” and “Incorporation of Certain Information by Reference”, and our financial statements, related notes and other financial information included or incorporated by reference in this prospectus, before deciding to buy shares of our Common Stock. Unless the context requires otherwise, references in this prospectus to “we,” “us,” “the Company” and “our” refer to NeuroOne Medical Technologies Corporation.
About Us
We are a medical technology company focused on the development and commercialization of thin film electrode technology for continuous electroencephalogram (cEEG) and stereoelectroencephalography (sEEG) recording, spinal cord stimulation, brain stimulation and ablation solutions for patients suffering from epilepsy, Parkinson’s disease, dystonia, essential tremors and other related brain related disorders. Additionally, we are investigating the potential applications of our technology associated with artificial intelligence. Members of our management team have held senior leadership positions at a number of medical technology and biopharmaceutical companies, including Boston Scientific, St. Jude Medical, Stryker Instruments, C.R. Bard, A-Med Systems, Sunshine Heart, Empi, Don-Joy and PMT Corporation (“PMT”).
About this Offering
2019 Offering of Convertible Promissory Notes and Warrants
2019 Notes and 2019 Warrants
Between November 1, 2019 and December 3, 2019, the Company entered into subscription agreements with certain accredited investors (the “2019 Paulson Subscribers”), pursuant to which the Company, in a private placement (the “2019 Paulson Private Placement”), agreed to issue and sell to the 2019 Paulson Subscribers 13% convertible promissory notes (each, a “2019 Paulson Note” and collectively, the “2019 Paulson Notes”) and warrants to purchase shares of Common Stock with an exercise price of $1.87 (each, a “2019 Paulson Warrant” and collectively, the “2019 Paulson Warrants”). As of the final closing of the 2019 Paulson Private Placement, the Company issued 2019 Paulson Notes in an aggregate principal amount of $3,234,800 and 2019 Paulson Warrants exercisable for 864,913 shares of Common Stock.
2019 Conversion Shares
Between April 24, 2020 and June 25, 2020, certain 2019 Paulson Subscribers elected to convert $2,687,017.58 of the outstanding principal and interest of the 2019 Paulson Notes into 2,115,272 shares of Common Stock (the “2019 Conversion Shares”).
2019 Broker Warrants
In connection with the 2019 Paulson Private Placement, Paulson Investment Company (“Paulson”) received a cash commission equal to 12% of the gross proceeds from the sale of the 2019 Paulson Notes, and 10-year warrants to purchase 259,476 shares of Common Stock, at an exercise price equal $1.87 per share (the “2019 Broker Warrants”).
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2020 Offering of Convertible Promissory Notes and Warrants
2020 Notes and 2020 Warrants
Between April 30, 2020 and June 30, 2020, the Company entered into subscription agreements with certain accredited investors (the “2020 Paulson Subscribers”), pursuant to which the Company, in a private placement (the “2020 Paulson Private Placement”), agreed to issue and sell to the 2020 Paulson Subscribers 13% convertible promissory notes (each, a “2020 Paulson Note” and collectively, the “2020 Paulson Notes” and together with the 2019 Paulson Notes, the “Notes”) and warrants to purchase shares of Common Stock (each, a “2020 Paulson Warrant” and collectively, the “2020 Paulson Warrants” and together with the 2019 Paulson Warrants, the “Warrants”). As of the final closing of the 2020 Paulson Private Placement, the Company issued 2020 Paulson Notes in an aggregate principal amount of $5,122,700, and 2020 Paulson Warrants exercisable for 1,369,690 shares of Common Stock.
2020 Conversion Shares
In addition, between May 4, 2020 and July 21, 2020, certain 2020 Paulson Subscribers elected to convert $3,590,840 of the outstanding principal and interest of the 2020 Paulson Notes into 4,012,334 shares of Common Stock, and on July 23, 2020, the remaining $1,613,961 of the outstanding principal and interest of the 2020 Paulson Notes were automatically converted into 1,605,532 shares of Common Stock following the announcement of a Strategic Transaction (as defined in the 2020 Paulson Notes) (together, the “2020 Conversion Shares”).
2020 Broker Warrants
In connection with the 2020 Paulson Private Placement, Paulson received a cash commission equal to 12% of the gross proceeds from the sale of the 2020 Paulson Notes and 7-year warrants to purchase 410,911 shares of Common Stock, with an exercise price equal to $1.87 (the “2020 Broker Warrants” together, with the 2019 Broker Warrants, the “Broker Warrants”, and collectively, with the Paulson Warrants, the “Warrants”).
Common Stock Offerings
On October 23, 2019 and July 28 2020, the Company entered into Securities Purchase Agreements with certain accredited investors in separate private placements, pursuant to which the Company agreed to issue and sell 141,666 shares (“2019 Shares”) and 75,000 shares, respectively (“2020 Shares, and together with the 2019 Shares, the “Shares”).
Our Technology
We are developing our cortical, sheet and depth electrode technology to provide solutions for diagnosis through cEEG recording and sEEG recording and treatment through spinal cord stimulation, brain stimulation and ablation, all in one product. A cEEG is a continuous recording of the electrical activity of the brain that identifies the location of irregular brain activity, which information is required for proper treatment. cEEG recording involves an invasive surgical procedure, referred to as a craniotomy. sEEG involves a less invasive procedure whereby doctors place electrodes in targeted brain areas by drilling small holes through the skull. Both methods of seizure diagnosis are used to identify areas of the brain where epileptic seizures originate in order to precisely locate the seizure source for therapeutic treatment if possible.
Deep brain stimulation, or DBS, therapies involve activating or inhibiting the brain with electricity that can be given directly by electrodes on the surface or implanted deeper in the brain via depth electrodes. Introduced in 1987, this procedure involves implanting a power source referred to as a neurostimulator, which sends electrical impulses through implanted depth electrodes, to specific targets in the brain for the treatment of disorders such as Parkinson’s disease, essential tremor, dystonia, and chronic pain. Alzheimer’s is another indication evaluating the effects of DBS. Unlike ablative technologies, the effects of DBS are reversible.
RF ablation is a procedure that uses radiofrequency under the electrode contacts that is directed to the site of the brain tissue that is targeted for removal. The process involves delivering energy to the contacts, thereby heating them and destroying the brain tissue. The ablation does not remove the tissue. Rather, it is left in place and typically scar tissue forms in the place where the ablation occurs. This procedure is also known as brain lesioning as it causes irreversible lesions.
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Failed back surgery syndrome (“FBSS”) is a condition that produces chronic lower back/leg pain due to one or more failed back surgeries. Typically, it is related to patients that suffer with pain after surgery of the lumbar spine for degenerative disc disease. Re-operations are usually not recommended for these patients due to low success rates. These patients experience greater levels of pain, a lower quality of life, varying levels of disability and higher rate of unemployment. Spinal cord stimulation works by placing an electrodes(s) in a targeted area of the spine and then connected to an implantable pulse generator that sends electrical stimulation to the electrode to block the pain signals from reaching the brain.
Our cortical sheet electrode and depth electrode technology has been tested over the years by both WARF, the owners of our licensed patents, and Mayo Clinic located in Rochester, Minnesota, in both pre-clinical models as well as through an IRB approval at Mayo Clinic for clinical research. Regarding our ablation electrode, the Cleveland Clinic has performed testing in bench top models and pre-clinical (or animal testing) modes. These pre-clinical tests have demonstrated that the technology is capable of recording, ablation and acute stimulation, although our technology remains in product development (meaning that additional trials will be needed prior to it being approved for sale by the U.S. Food and Drug Administration (the “FDA”)) for all of the recording (or diagnostic) and therapeutic modalities.
Strategy
Our goal is to be the global leader in cEEG and sEEG recording, deep brain stimulation and ablation, owning the procedure from diagnosis through treatment. The key elements of our strategy include:
● | Introduce cortical strip and grid electrodes for the diagnosis of epilepsy in United States: In December 2019, we announced that we received U.S. FDA 510(k) clearance to market our thin film cortical electrode technology for temporary (less than 30 days) recording, monitoring, and stimulation on the surface of the brain. Our initial product offering will be placed through traditional surgical means involving a craniotomy until such time, if any, that we launch our minimally invasive procedure. We believe, due to physician feedback, that our technology under development would represent a major improvement over existing cortical electrodes for the recording of brain activity. We are initially targeting epilepsy as we believe this is a clinical area of great need and a market that is underserved with a quick path to commercialization. We believe the largest and quickest-to-market geography for our cortical strip and grid technology under development is in the United States for a number of reasons, including the following: (i) many industry sources believe there is a large underserved U.S. market, (ii) healthy procedural reimbursement for centers and physicians, (iii) robust average selling prices, (iv) physician enthusiasm for our technology under development. |
● | Launch depth electrodes for sEEG recording: Given the reluctance of patients to undergo epilepsy surgery due to its invasiveness, a number of epilepsy centers have adopted the use of depth electrodes, which are placed by drilling small holes into the patient’s cranium, thereby avoiding a craniotomy. We believe our technology will offer advantages to current depth electrode technology and will enable us to offer a therapeutic solution using this technology in the future. As we develop our technology, we plan to release further information about the expected advantages of our technology over currently available therapies. |
● | Introduce minimally invasive delivery system for cortical electrodes: Cortical electrodes generally require a craniotomy, which is a very invasive procedure that can cause patient complications. Because of this, many patients have opted to not have epilepsy surgery, instead accepting the consequences and risks associated with epilepsy. We intend to develop a procedure that may include a delivery system placed through a small circular incision in the skull for implantation of the cortical grid and strip electrodes. We believe this will increase patient willingness to accept the surgery and increase market penetration. Until we are able to develop this procedure, if at all, our initial product offering will be placed through traditional surgical means involving a craniotomy and may be less likely to be adopted by physicians and patients due to unwillingness of patients to undergo epilepsy surgery. |
● | Develop percutaneous placed electrodes for spinal cord stimulation with scalable contact configurations: Given that many surgically placed technologies have become less invasive due to patient and physician demands, we believe that our flexible thin film technology will allow for percutaneous placement, thus potentially eliminating the need to make a surgical incision. By leveraging our existing FDA cleared cortical electrode technology, we may be able to offer the ability to improve precision of where the stimulation is delivered. NeuroOne’s platform thin film technology has the capability to increase the number of contacts in a similar footprint that has fewer contacts. |
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● | Utilize these core technologies to develop all in one diagnostic and therapeutic solutions: Patients currently undergo one surgical procedure for diagnosis (either to have a cortical electrode placed via a craniotomy or depth electrodes placed via holes drilled into the skull) and, hopefully after the brain recordings successfully indicate where the affected brain tissue is located, a second procedure or surgery is then required to treat the patient. There is strong physician interest in being able to perform both the diagnostic and therapeutic procedure concurrently. We are developing our technology with the goal of being able to offer this benefit although there can be no assurance that we will be able to do so. We are pursuing cortical grid, strip and depth electrode technology that can record brain activity (diagnose), ablate brain tissue and also provide both acute and long term stimulation. The technology has demonstrated these functions in acute and short term animal models; however, additional development is required to offer a device that has long term therapeutic application. These therapeutic technologies are expected to require more robust regulatory approvals for the United States, ranging from a 510(k) with human clinical data to PMAs. We will engage the FDA at the proper time to determine the most efficient clinical path. |
● | Gain approval for other brain or motor related disorders such as Parkinson’s with the therapeutic technologies developed for epilepsy: While we are developing our technology for the diagnosis and treatment of epilepsy, we believe that our technology has strong application and utilization for other brain or motor related disorders such as Parkinson’s disease, dystonia, essential tremors and facial pain as these diseases are currently treated with DBS if medications are not effective. As previously mentioned, we are planning to offer electrodes that can be implanted for long term stimulation applications, but such use will require that we pursue additional approvals from the FDA and any international regulatory bodies where we seek to commercialize our technology. |
● | Explore partnerships with other companies that leverage our core technology: Given that our technology enables, complements and/or competes with a number of companies that are in the market or attempting to enter the market with diagnostic or therapeutic technologies to treat brain related disorders, we believe there may be opportunities to establish mutually beneficial relationships. In addition, our technology may have application in cardiovascular, orthopedic and pain related indications that could benefit from a hi-fidelity thin film electrode product that can provide stimulation and/or ablation therapies. |
● | Investigate the potential applications associated with Artificial Intelligence: We have been informed by some of our corporate advisors that the ability to offer scale-able electrode technology that can provide thousands of electrodes in the brain may be helpful in treating medical conditions that may benefit from using artificial intelligence. The Company has formed an advisory board that will provide guidance to the Company as we continue to explore the opportunities in this exciting field. |
Corporate History
NeuroOne Medical Technologies Corporation was originally incorporated under the laws of the State of Nevada on Augustunder the name Original Source Entertainment, Inc. On July 20, 2009.
Operations We are2017, we consummated a development stagereverse acquisition transaction to acquire a privately-held company, formed to
contract with various recording artistsNeuroOne, Inc., and
then, in turn, contract those songs with the
highest quality and potential for placement in
television and film.
We have a deficit accumulated in the
development state of $(3,078) and $(2,779) as
of June 30, 2010 and December 31, 2009,
respectively. In their opinion on our
financial statements as of and for the period
from inception (August 20, 2009) to December
31, 2009, our auditors have indicated that
there is substantial doubt about our ability to
continue as a going concern.
Common Shares
Outstanding priorresult, NeuroOne, Inc. became our wholly-owned subsidiary. We refer to Offering 4,500,000
Common Shares being
sold in this offering 10,000,000
Common Shares being
sold in this offering
by selling security
holders 1,500,000
Terms of Primary
Offering Thistransaction as the “Acquisition.” On December 30, 2019, NeuroOne, Inc. merged with and into NeuroOne Medical Technologies Corporation.
Corporate Information
Our principal executive offices are located at 7599 Anagram Dr., Eden Prairie, MN 55344, and our telephone number is 952-426-1383. We maintain a self-underwritten public offering
with no minimum purchase requirement. Shares
will be offered on a best efforts basis andwebsite at www.n1mtc.com, to which we do not intend to use an underwriter for this
offering. We do not have an arrangement to
place the proceeds from this offering in an
escrow, trust, or similar account. Any funds
raised from the offering will be immediately
available to us for our immediate use.
Sales by Selling
Security Holders The selling security holders must sell at a
fixed price of $.05 until our shares are quoted
a market or securities exchange. Thereafter,
the selling security holders may sell at
prevailing prices or privately negotiated
prices.
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We are registering common shares on behalf of
the selling security holders in this
prospectus. We will not receive any cash or
other proceeds in connection with the
subsequent sales. We are not selling any
common shares on behalf of selling security
holders and have no control or affect on the
selling security holders.
Termination of the
Offering The primary offering will commence on the
effective date of this prospectus and will
terminate on or before December 31, 2011. In
our sole discretion, we may terminate the
primary offering before all of the common
shares are sold. The secondary offering by
selling shareholders shall commence upon
termination of the primary offering.
Market for our common
stock Our common stock is not quoted on a market or
securities exchange. We cannot provide any
assurance that an active market in our common
stock will develop. We intend to quote our
common shares on a market or securities
exchange.
Use of proceeds We will use the proceeds of this offering to
develop and execute a fully operational valid
marketing plan for our product.
RISK FACTORS
Our business is subject to numerous risk factors, including the
following.
1. We are a development stage company with a limited operating
history and may never be able to effectuate our business plan or
achieve any revenues or profitability. Potential investors have a high
probability of losing their entire investment.
We are subject to all of the risks inherent in the establishment of a
new business enterprise. The registrant was incorporated on August 20,
2009. Although we have begun limited business operations, we may not
be able to successfully effectuate our business plan or we may not be
able to market our services in the future in a manner that will
generate significant revenues. In addition, any revenues that we may
generate may be insufficient for us to become profitable.
In particular, potential investors should be aware that we have not
proven that we can:
- - raise sufficient capital in the public and/or private markets;
- - have access to a line of credit in the institutional lending
marketplace for the expansionregularly post copies of our business;
- - respond effectively to competitive pressures; or
- - recruit and build a management team to accomplish our business
plan.
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Accordingly, our prospects must be considered in light of the risks,
expenses and difficulties frequently encountered in establishing a new
business, and Original Source is a highly speculative venture involving
significant financial risk.
2. We cannot offer any assurancepress releases as to our future financial results.
You may lose your entire investment.
We have not received substantial income from operations to date and
future financial results are uncertain. We cannot assure you that
Original Source can operate in a profitable manner. We have a retained
deficit of $(3,078) and $(2,779)well as of June 30, 2010 and December 31,
2009, respectively. Even if we obtain future revenues sufficient to
expand operations, increased production or marketing expenses would
adversely affect liquidity of Original Source.
3.additional information about us. Our auditors have expressed a going concern issue that notes our
need for capital and/or revenues to survive as a business. You may
lose your entire investment.
Our ability to continue as a going concern is dependent on our ability
to further implement its business plan and raise capital.
We are currently a development stage company and our continued
existence is dependent upon our ability to resolve our liquidity
problems, principally by obtaining additional debt financing and/or
equity capital. We have yet to generate a significant cash flow, and
until sales of products commence, we are highly dependent upon debt and
equity funding. Should continuing debt and equity funding requirements
not be met, our operations may cease to exist.
4. There is a disparity between the offering price and the prices at
which the selling security holders acquired their common shares. This
may negatively affect your ability to sell your common shares in the
future.
The selling security holders will sell their common shares at $.05 per
common share until our common shares are quoted on a market or
securities exchange. The selling security holders acquired their
common shares for no cash and/or services for $.001 per common share
and are registering common shares to be sold at $.05 until our common
shares are quoted on the OTC Electronic Bulletin Board.
5. We do not have a public market in our securities. If our common
stock has no active trading market, you may not be able to sell your
common shares at all.
We do not have a public market for our common shares. Our securities
are not traded on any exchange. We cannot assure you that an active
public market will ever develop. Consequently, you may not be able to
liquidate your investment in the event of an emergency or for any other
reason.
6. We do not meet the requirements for our stock to be quoted on
NASDAQ, American Stock Exchange or any other senior exchange and the
tradability in our stock will be limited under the penny stock
regulation.
9
The liquidity of our common stock is restricted as our common stock
falls within the definition of a penny stock.
Under the rules offilings with the Securities and Exchange Commission, ifor SEC, will be available free of charge through the pricewebsite as soon as reasonably practicable after being electronically filed with or furnished to the SEC. Information contained on, or accessible through, our website does not constitute a part of this prospectus or our other filings with the SEC, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase shares of our Common Stock.
Recent Developments
On July 20, 2020, the Company entered into an exclusive development and distribution agreement (the “Development Agreement”) with Zimmer, Inc. (“Zimmer”), pursuant to which the Company granted Zimmer exclusive global rights to distribute NeuroOne’s strip and grid cortical electrodes and electrode cable assembly products. Additionally, NeuroOne granted Zimmer the exclusive right and license to distribute certain depth electrodes developed by NeuroOne.
Under the terms of the registrant's common stock onDevelopment Agreement, NeuroOne will be responsible for all costs and expenses related to developing the OTC Bulletin Board is below
$5.00 per share, the registrant's common stockproducts, and Zimmer will come within the
definition of a "penny stock." As a result, Original Source common
stock is subjectbe responsible for all costs and expenses related to the "penny stock" rulescommercialization of the products. In addition to the Development Agreement, Zimmer and regulations. Broker-
dealers who sell penny stocksNeuroOne have entered into a Manufacturing and Supply Agreement and a supplier quality agreement with respect to certain typesthe manufacturing and supply of investors are
requiredthe products.
4
THE OFFERING
Common Stock offered by the Selling Stockholders | 10,883,808 shares | |
Common Stock outstanding | 22,052,294 shares (as of August 4, 2020) | |
Common Stock to be outstanding after this offering, assuming full conversion or exercise of all Warrants | 24,930,674 shares | |
Use of proceeds | We will not receive any proceeds from the sale by the Selling Stockholders of the shares of Common Stock being offered by this prospectus. | |
Current Market for the Common Stock and Warrants | Our Common Stock is currently quoted on the OTCQB under the symbol “NMTC.” | |
Risk factors | You should read the “Risk Factors” section of this prospectus and in NeuroOne’s Annual Report on Form 10-K for the year ended September 30, 2019 and NeuroOne’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020, which are incorporated by reference into this prospectus for a discussion of certain factors to consider before deciding to purchase any of our securities. |
Except as otherwise indicated, all information in this prospectus is based on 22,052,294 shares issued and outstanding at August 4, 2020 and does not take into account:
● | 1,438,485 shares of our Common Stock issuable upon the exercise of options outstanding as of June 30, 2020, with a weighted-average exercise price of $2.05 per share; |
● | 110,834 shares of our Common Stock issuable upon the vesting of restricted stock units outstanding as of June 30, 2020; |
● | 10,170,588 shares of our Common Stock issuable upon the exercise of the warrants outstanding as of June 30, 2020 with a weighted-average exercise price of $2.35 per share; |
● | 1,879,400 shares of our Common Stock reserved for future issuance under our equity compensation plans; and |
● | Shares issuable upon the optional conversion of the remaining 2019 Paulson Notes, which amount cannot be determined until the date of conversion. |
5
An investment in our Common Stock involves a high degree of risk. Before deciding whether to complyinvest in our Common Stock, you should consider carefully the risks and uncertainties described under the section captioned “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2019, filed with the Commission's regulations concerningSEC on December 20, 2019, as amended on January 28, 2020, and our Quarterly Report on Form 10-Q for the transferquarter ended March 31, 2020, filed with the SEC on May 14, 2020, each of penny stock. These regulations require broker-dealers to:
- Make a suitability determination prior to selling penny stock towhich is incorporated by reference in this prospectus, together with all of the purchaser;
- Receiveinformation contained in this prospectus and documents incorporated by reference herein. We caution you that the purchaser's written consent to the transaction;risks and - Provide certain written disclosures to the purchaser.
These requirements may restrict the ability of broker/dealers to sell
the registrant's common stock, and may affect the ability to resell the
registrant's common stock.
7. The initial price of $.05 mayuncertainties we have little or no relationship to
the market price, if any of our common stock.
The offering price of our common stock by the selling security holder
was arbitrarily determined without regard to book value, recent
issuances of shares, such as for cash and services or market value.
There may be little or no relationship between the initial prices of
$.05 and the market price. You may lose your entire investment.
8. Future sales by our stockholdersdescribed, among others, could cause our actual results to differ materially from those expressed in forward-looking statements made by us or on our behalf in filings with the stock price to
declineSEC, press releases, communications with investors and may affect your ability to liquidate your investment.
In the future, Original Source may issue equityoral statements. Additional risks and debt securities.
Any sales of additional common shares may have a depressive effect upon
the market price of Original Source's common stock causing the stock
price to decline.
9. The selling security holders may have liability because of their
statusuncertainties not presently known or which we consider immaterial as underwriters. They may sue us if there are any omissions or
misstatements in the registration statement that subject them to civil
liability.
Under the Securities Act of 1933, the selling security holders will be
considered to be underwriters of the offering. The selling security
holdersdate hereof may also have civil liability under Section 11 and 12 of the
Securities Act for any omissions or misstatements in the registration
statement because of their status as underwriters. We may be sued by
selling security holders if omissions or misstatements result in civil
liability to them.
10. Our officers and directors have little experience in running a
business similar to our company, they may not be able to successfully
operate such a business which could cause you to lose your investment.
We are a development stage company and while we intend to place
thousands of additional songs under contract and market these songs to
the television and film industry, there is no assurance that our
management will be able to accomplish our goals. Lecia L. Walker and
E. Lynn Atwood, our current officers and directors, have effective
10
control over all decisions regarding both policy and operations of
Original Source with no oversight from other management. While Lecia
L. Walker has had experience in the same business that we are in, there
is no assurance that she will be able to manage our operations and
bring it to a profitable position. Our success is contingent upon the
ability of our current officers and directors to make appropriate
business decisions in these areas.
11. If we lose the services of key members of our management team, we
may not be able to execute our business strategy effectively.
Our future success depends in a large part upon the continued service
of key members of our management team. In particular, Lecia L. Walker,
an officer and director, is critical to our overall management as well
as our strategic direction. The loss of Lecia Walker's services could
have a material adverse effect on our business operations and financial
condition. We do not maintain any key-person life insurance policies.
The loss of any of our management or key personnel could materially
harm our business. 12. Our officers and directorsThere have been no other business activities and
will only be devoting a portion of their time to our operations. As a
result, our operations may be sporadic which may result in periodic
interruptions or suspensions of our business activities.
Our officers and directors are not required to work exclusively for us,
are only engaged in our business activities on a part-time basis and do
not intend to devote full timematerial changes to the business of the registrantRisk Factors described under Item 1A. “Risk Factors” in the foreseeable future. This could cause the officers a conflict of
interest between the amount of time they devote to our business
activitiesAnnual Report and the amountQuarterly Report.
6
This prospectus contains forward-looking statements that involve substantial risks and uncertainties. The forward-looking statements are contained principally in the sections entitled “Risk Factors” and the documents incorporated by reference herein. In some cases, you can identify forward-looking statements by the words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “target,” “seek,” “contemplate,” “continue” and “ongoing,” or the negative of time requiredthese terms, or other comparable terminology intended to identify statements about the future. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be devoted to their other
activities. Lecia L. Walker, our chief executive officer, chief
financial officer and a director intends to devote only approximately
20 to 30 hours per week to our business activities until operations
increase, however she may devote whole daysmaterially different from the information expressed or even multiple days at a
stretch when required.
Subsequent to the completion of this offering,implied by these forward-looking statements. Although we intend to increase
our business activities in terms of placing additional songs under
contract and, in turn, contracting those songs with the television and
movie industry. This increase in business activities may require that
either of our officers engage in our business activities on a full-time
basis orbelieve that we hire additional employees; however, at this time, we
do not have sufficient funds to pursue either option.
13. We may not be able to locate and hire necessary personnel to make
our company a success.
The expansion of our business will place further demands on existing
management and future growth. Profitability will depend, in part, on
our ability to hire and retain the necessary personnel to operate and
grow our business. There is no certainty that we will be able to
identify, attract, hire, train, retain and motivate other highly
skilled technical, administrative, managerial, marketing and customer
service personnel. Competition for such personnel is intense and there
is no certainty that we will be able to successfully attract, integrate
11
or retain sufficiently qualified personnel. The failure to attract and
retain the necessary personnel could have a materially adverse effect
on our business, operations and financial condition.
14. If we cannot successfully compete, we may never reach profitable
operations.
The music industry is intensely competitive and fragmented. We will
compete on thereasonable basis of price and selection against other small
companies like ours, as well as large companies that have a similar
business and large marketing companies. We may never be able to
compete successfully and may never reach profitable operations. You
may lose your entire investments.
15. State securities laws may limit secondary trading, which may
restrict the states in which and conditions under which you can sell
the shares offered by this prospectus.
Secondary trading in common stock sold in this offering will not be
possible in any state until the common stock is qualified for sale
under the applicable securities laws of the state or there is
confirmation that an exemption, such as listing in certain recognized
securities manuals, is available for secondary trading in the state. If
we fail to register or qualify, or to obtain or verify an exemption for
the secondary trading of, the common stock in any particular state, the
common stock could not be offered or sold to, or purchased by, a
resident of that state. In the event that a significant number of
states refuse to permit secondary trading in our common stock, the
liquidity for the common stock could be significantly impacted thus
causing you to realize a loss on your investment.
16. We may issue shares of preferred stock in the future that may
adversely impact your rights as holders of our common stock.
Our Articles of Incorporation authorizes us to issue up to 5,000,000
shares of "blank check" preferred stock. Accordingly, our board of
directors will have the authority to fix and determine the relative
rights and preferences of preferred shares, as well as the authority to
issue such shares, without further stockholder approval. As a result,
our board of directors could authorize the issuance of a series of
preferred stock that would grant to holders preferred rights to our
assets upon liquidation, the right to receive dividends before
dividends are declared to holders of our common stock, and the right to
the redemption of such preferred shares, together with a premium, prior
to the redemption of the common stock. To the extent that we do issue
such additional shares of preferred stock, your rights as holders of
common stock could be impaired thereby, including, without limitation,
dilution of your ownership interests in us. In addition, shares of
preferred stock could be issued with terms calculated to delay or
prevent a change in control or make removal of management more
difficult, which may not be in your interest as holders of common
stock.
17. We have not yet adopted of certain corporate governance measures.
As a result, our stockholders have limited protections against
interested director transactions, conflicts of interest and similar
matters.
12
The Sarbanes-Oxley Act of 2002, as well as rule changes proposed and
enacted by the SEC, the New York and American Stock Exchanges and the
Nasdaq Stock Market, as a result of Sarbanes-Oxley, require the
implementation of various measures relating to corporate governance.
These measures are designed to enhance the integrity of corporate
management and the securities markets and apply to securities which are
listed on those exchanges or the Nasdaq Stock Market. Because we are
not presently required to comply with many of the corporate governance
provisions and because we chose to avoid incurring the substantial
additional costs associated with such compliance any sooner than
necessary, we have not yet adopted these measures.
Because all our directors are non-independent, we do not currently have
independent audit or compensation committees. As a result, the
directors have the ability, among other things, to determine their own
level of compensation. Until we comply with such corporate governance
measures, regardless of whether such compliance is required, the
absence of such standards of corporate governance may leave our
stockholders without protections against interested director
transactions, conflicts of interest and similar matters and investors
may be reluctant to provide us with funds necessary to expand our
operations.
18. We may be exposed to potential risks resulting from new
requirements under Section 404 of the Sarbanes-Oxley Act of 2002.
If we become registered with the SEC, we will be required, pursuant to
Section 404 of the Sarbanes-Oxley Act of 2002, to include in our annual
report our assessment of the effectiveness of our internal control over
financial reporting. We do not have a sufficient number of employees to
segregate responsibilities and may be unable to afford increasing our
staff or engaging outside consultants or professionals to overcome our
lack of employees.
19. The costs to meet our reporting and other requirements as a
public company subject to the Exchange Act of 1934 will be substantial
and may result in us having insufficient funds to expand our business
or even to meet routine business obligations.
If we become a public entity, subject to the reporting requirements of
the Exchange Act of 1934, we will incur ongoing expenses associated
with professional fees for accounting, legal and a host of other
expenses for annual reports and proxy statements. We estimate that
these costs could range up to $35,000 per year for the next few years
and will be higher if our business volume and activity increases but
lower during the first year of being public because our overall
business volume will be lower, and we will not yet be subject to the
requirements of Section 404 of the Sarbanes-Oxley Act of 2002. As a
result, we may not have sufficient funds to grow our operations.
FORWARD LOOKING STATEMENTS
The statementseach forward-looking statement contained in this prospectus, we caution you that are not historical
fact are forward-looking statements which can be identified by the use
of forward-looking terminology such as "believes," "expects," "may,"
"should," or "anticipates" or the negative thereof or other variations
13
thereon or comparable terminology, or by discussions of strategy that
involve risks and uncertainties. We have made the forward-looking
statements with management's best estimates prepared in good faith.
Because of the number and range of the assumptions underlying our
projections and forward-looking statements, many of which are subject
to significant uncertainties and contingencies that are beyond our
reasonable control, some of the assumptions inevitably will not
materialize and unanticipated events and circumstances may occur
subsequent to the date of this prospectus.
These forward-lookingthese statements are based on a combination of facts and factors currently known by us and our expectations of the future, about which we cannot be certain. Forward-looking statements include statements about:
● | our plans to develop and commercialize our cortical strip, grid and depth electrode technology; |
● | our plans for and our expectations regarding the pre-clinical testing and clinical trials of our cortical strip, grid and depth electrode technology that will be required by the FDA or foreign regulatory bodies; |
● | the timing and availability of data from pre-clinical tests or clinical trials; |
● | the timing of our planned regulatory filings; |
● | the timing of and our ability to obtain and maintain regulatory approval of our cortical strip, grid and depth electrode technology; |
● | our expectations regarding international opportunities for commercializing our cortical strip, grid and depth electrode technology under development; |
● | our plans to list our common stock on Nasdaq; |
● | the clinical utility of our cortical strip, grid and depth electrode technology under development; |
● | our ability to develop our cortical strip, grid and depth electrode technology with the benefits we hope to offer as compared to existing technology, or at all; |
● | our ability to develop future generations of our cortical strip, grid and depth electrode technology; |
● | our future development priorities; |
● | our ability to obtain reimbursement coverage for our cortical strip, grid and depth electrode technology; |
● | our expectations about the willingness of healthcare providers to recommend our cortical strip, grid and depth electrode technology to people with epilepsy, Parkinson’s disease, essential tremors, and other brain related disorders; |
● | our future commercialization, marketing and manufacturing capabilities and strategy; |
● | our ability to comply with applicable regulatory requirements; |
● | our ability to maintain our intellectual property position; |
● | our estimates regarding the size of, and future growth in, the market for our technology under development; and |
● | our estimates regarding our future expenses and needs for additional financing. |
Forward-looking statements are based on management’s current expectations, estimates, forecasts and projections about our business and the industry in which we willoperate, and management’s beliefs and assumptions are not update this information other than required by law.
Therefore, the actual experienceguarantees of Original Source,future performance or development and results
achieved during the period covered by any particular projectionsinvolve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. You should refer to the “Risk Factors” section of this prospectus and the documents incorporated by reference herein for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you that the forward-looking statements in this prospectus will prove to be accurate. Furthermore, if our forward-looking statements prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements, you should not be regardedregard these statements as a representation or warranty by Original Source,us or any other person that we will realizeachieve our objectives and plans in any specified time frame, or at all.
These forward-looking statements speak only as of the date of this prospectus. Except as required by law, we assume no obligation to update or revise these estimatesforward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and projections,risks and actual resultsother information we describe in the reports we will file from time to time with the SEC after the date of this prospectus.
7
We are not selling any securities under this prospectus and will not receive any proceeds from the sale of shares of Common Stock offered by this prospectus by the Selling Stockholders. However, we may vary
materially.receive proceeds from the cash exercise of the Warrants, which, if exercised in cash at the current exercise price with respect to all warrants, would result in gross proceeds to us of $5,382,570. The use of proceeds from such Warrant exercises, if any, will be used for research and development, clinical studies, legal fees and sales and marketing expenses, as well as working capital and general corporate purposes. For information about the Selling Stockholders, see “Selling Stockholders.”
The Selling Stockholders will pay any underwriting discounts and commissions and expenses incurred by the Selling Stockholders for brokerage or legal services or any other expenses incurred by the Selling Stockholders in disposing of the shares of Common Stock offered hereby. We cannot assure youwill bear all other costs, fees and expenses incurred in effecting the registration of the shares of Common Stock covered by this prospectus, including all registration and filing fees and fees and expenses of our counsel and accountants.
8
This prospectus covers an aggregate of up to 10,883,808 shares of our common stock that may be sold or otherwise disposed of by the Selling Stockholders identified herein. Such shares include (i) 2,155,435 2019 Conversion Shares, 66,583 additional shares issued to an investor, 864,913 shares of our Common Stock issuable upon the exercise of 2019 Paulson Warrants, and 253,583 shares of Common Stock issuable upon the exercise of 2019 Broker Warrants, (ii) 5,566,744 2020 Conversion Shares, 1,356,321 shares of our Common Stock issuable upon the exercise of 2020 Paulson Warrants, and 403,563 shares of Common Stock issuable upon the exercise of 2020 Broker Warrants and (iii) 216,666 shares of our Common Stock issued to investors in the Common Stock Offerings. We are not selling any shares of Common Stock under this prospectus and will not receive any proceeds from the sale of shares of Common Stock by the Selling Stockholders.
The table below sets forth, to our knowledge, information concerning the beneficial ownership of shares of our Common Stock by the Selling Stockholders as of August 4, 2020. The information in the table below with respect to the Selling Stockholders has been obtained from the Selling Stockholders. The Selling Stockholders may sell all, some or none of the shares of Common Stock subject to this prospectus. See “Plan of Distribution.”
Beneficial ownership is determined in accordance with the rules of the SEC, and includes voting or investment power with respect to shares. To our knowledge, except as indicated in the footnotes to this table, (i) each person named in the table has sole voting and investment power with respect to all shares of Common Stock shown in the table to be beneficially owned by such person, and (ii) none of the selling stockholders has had any position, office or other material relationship with us or any of these expectationsour predecessors or affiliates within the past three years. Except as set forth below, none of the selling stockholders is a broker-dealer or an affiliate of a broker-dealer.
We have assumed all shares of Common Stock reflected on the table will be realizedsold from time to time in the offering covered by this prospectus, although the Selling Stockholders are under no obligation known to us to sell any shares of Common Stock at this time. Because the Selling Stockholders may offer all or that any portions of the forward-looking statements contained
hereinshares of Common Stock listed in the table below, no estimate can be given as to the amount of those shares of Common Stock covered by this prospectus that will prove to be accurate.
PLANheld by the Selling Stockholders upon the termination of the offering.
Number of Shares of Common Stock Beneficially Owned | Shares | Beneficial Ownership After Offering | ||||||||||||||||||
Name of Selling Stockholder | Prior to Offering (1) | Shares Offered | Underlying Warrants | Shares | Ownership Percentage(2) | |||||||||||||||
4P’s Enterprises, LLC | 63,611 | (3) | 50,242 | 13,369 | 0 | * | ||||||||||||||
Albert Landstrom | 14,844 | 0 | 14,844 | 0 | * | |||||||||||||||
Allen Gabriel | 39,267 | 29,267 | 10,000 | 0 | * | |||||||||||||||
Alliance Trust Company, CUST FBO Brian Mark Miller ROTH IRA | 220,538 | (4) | 167,062 | 53,476 | 0 | * | ||||||||||||||
Alok Agrawal & Aruna Agrawal JT WROS | 17,596 | 14,254 | 3,342 | 0 | * | |||||||||||||||
Angus Bruce | 77,095 | 61,052 | 16,043 | 0 | * | |||||||||||||||
Anish Monga | 50,000 | 0 | 50,000 | 0 | * | |||||||||||||||
Annie Lee Schaufele | 73,174 | 59,805 | 13,369 | 0 | * | |||||||||||||||
Ardara Capital LP | 293,797 | (5) | 240,321 | 53,476 | 0 | * | ||||||||||||||
Arthur Steinberg | 64,491 | 51,122 | 13,369 | 0 | * | |||||||||||||||
Barry Saxe | 93,350 | 70,623 | 22,727 | 0 | * | |||||||||||||||
BCS Capital LLC | 27,035 | (6) | 22,035 | 5,000 | 0 | * | ||||||||||||||
Beacon Investment LLC | 219,079 | (7) | 178,972 | 40,107 | 0 | * | ||||||||||||||
Bradley & Lori Abeson Rev Family Trust | 35,056 | (8) | 28,372 | 6,684 | 0 | * | ||||||||||||||
Brian Skillern | 27,382 | 20,698 | 6,684 | 0 | * |
9
Number of Shares of Common Stock Beneficially Owned | Shares | Beneficial Ownership After Offering | ||||||||||||||||||
Name of Selling Stockholder | Prior to Offering (1) | Shares Offered | Underlying Warrants | Shares | Ownership Percentage | |||||||||||||||
Burt Stangarone | 44,778 | 31,882 | 10,696 | 2,200 | * | |||||||||||||||
C. James Prieur & Karen Prieur JTWROS | 120,622 | (9) | 0 | 25,668 | 94,954 | * | ||||||||||||||
Calcott Family Trust | 78,433 | (10) | 58,433 | 20,000 | 0 | * | ||||||||||||||
CD Walker LLC | 240,554 | (11) | 170,447 | 40,107 | 30,000 | * | ||||||||||||||
Chad Dale | 36,153 | 29,469 | 6,684 | 0 | * | |||||||||||||||
Charles Engbers | 64,491 | 51,122 | 13,369 | 0 | * | |||||||||||||||
Charles Jeffrey Trick | 27,517 | 20,833 | 6,684 | 0 | * | |||||||||||||||
Charles Mader | 55,134 | 41,765 | 13,369 | 0 | * | |||||||||||||||
Chess Family Trust | 63,862 | (12) | 50,493 | 13,369 | 0 | * | ||||||||||||||
Chitayat Holdings, LLC | 38,468 | (13) | 30,447 | 8,021 | 0 | * | ||||||||||||||
Christopher Steven Clark | 143,090 | 0 | 112,839 | 30,251 | * | |||||||||||||||
Christopher P. Gutek | 74,940 | 44,940 | 10,000 | 20,000 | * | |||||||||||||||
Clayton A. Struve | 220,538 | 167,062 | 53,476 | 0 | * | |||||||||||||||
Cleto V. Escobedo III | 32,119 | 25,435 | 6,684 | 0 | * | |||||||||||||||
Collegiate Tutoring, Inc. | 15,965 | (14) | 12,623 | 3,342 | 0 | * | ||||||||||||||
Asset Recovery Association, Inc. | 78,825 | (15) | 63,825 | 15,000 | 0 | * | ||||||||||||||
Dale Ragan | 109,417 | 82,679 | 26,738 | 0 | * | |||||||||||||||
Damon Thomas | 1,204 | 0 | 1,204 | 0 | * | |||||||||||||||
Dan Mancuso | 5,118 | 0 | 5,118 | 0 | * | |||||||||||||||
Dean Bekken | 103,611 | 50,242 | 13,369 | 40,000 | * | |||||||||||||||
Dirgesh Patel | 25,392 | 18,708 | 6,684 | 0 | * | |||||||||||||||
District 2 Capital Fund LP | 438,861 | (16) | 0 | 93,583 | 345,278 | 1.6 | % | |||||||||||||
Dmitry Aksenov or Alex Aksenoff | 5,716 | 0 | 5,716 | 0 | * | |||||||||||||||
Douglas Harnar LLC | 580,923 | (17) | 284,078 | 66,845 | 230,000 | 1.0 | % | |||||||||||||
Due Mondi Investments, Ltd. | 27,566 | (18) | 20,882 | 6,684 | 0 | * | ||||||||||||||
Edward Rotter | 6,684 | 0 | 6,684 | 0 | * | |||||||||||||||
Efrat Investments LLC | 164,509 | (19) | 124,402 | 40,107 | 0 | * | ||||||||||||||
Emerging Markets Consulting, LLC | 78,539 | (20) | 50,170 | 13,369 | 15,000 | * | ||||||||||||||
Ernest W. Moody Revocable Trust | 218,835 | (21) | 165,359 | 53,476 | 0 | * | ||||||||||||||
Eugene Webb | 62,795 | 0 | 62,795 | 0 | * | |||||||||||||||
Faisal Siddiqui | 577,222 | 75,000 | 0 | 502,222 | 2.3 | % | ||||||||||||||
Felix Frayman | 27,368 | 20,684 | 6,684 | 0 | * | |||||||||||||||
Francis Lymburner | 139,644 | 105,687 | 33,957 | 0 | * | |||||||||||||||
Gary Levine | 27,566 | 20,882 | 6,684 | 0 | * | |||||||||||||||
Gary Saccaro | 28,990 | 0 | 28,990 | 0 | * | |||||||||||||||
GBS Living Trust | 32,858 | (22) | 24,837 | 8,021 | 0 | * | ||||||||||||||
George Copland & Jane Copland JT WROS | 57,690 | 45,658 | 12,032 | 0 | * | |||||||||||||||
George Martin | 63,862 | 50,493 | 13,369 | 0 | * | |||||||||||||||
Gerald A. Tomsic 1995 Trust | 109,871 | 83,133 | 26,738 | 0 | * | |||||||||||||||
Gerald Johnston | 38,619 | 30,598 | 8,021 | 0 | * | |||||||||||||||
Gerald Yanowitz | 41,889 | 31,194 | 10,695 | 0 | * | |||||||||||||||
Greg Buffington | 55,035 | 41,666 | 13,369 | 0 | * |
10
Number of Shares of Common Stock Beneficially Owned | Shares | Beneficial Ownership After Offering | ||||||||||||||||||
Name of Selling Stockholder | Prior to Offering (1) | Shares Offered | Underlying Warrants | Shares | Ownership Percentage | |||||||||||||||
Blaine 2000 Revocable Trust | 104,551 | (23) | 73,701 | 16,684 | 14,166 | * | ||||||||||||||
Gregory Mario | 31,993 | 25,309 | 6,684 | 0 | * | |||||||||||||||
Harry Striplin | 3,449 | 0 | 3,449 | 0 | * | |||||||||||||||
Hazem Algendi | 3,896 | 0 | 3,896 | 0 | * | |||||||||||||||
Hyong Kim | 31,769 | 25,085 | 6,684 | 0 | * | |||||||||||||||
Jack Cavin Holland 1979 Trust | 99,592 | (24) | 40,897 | 10,695 | 48,000 | * | ||||||||||||||
Jacob A. Rosenberg | 36,143 | 29,459 | 6,684 | 0 | * | |||||||||||||||
James T. Betts | 115,793 | 75,740 | 20,053 | 20,000 | * | |||||||||||||||
Jason Chiriano | 146,744 | 116,744 | 30,000 | 0 | * | |||||||||||||||
Jeanne Fishback & Keith Fishback JT WROS - changed to Keith Fishback | 72,287 | 58,918 | 13,369 | 0 | * | |||||||||||||||
Joel Yanowitz and Amy Metzenbaum Trust UTA 7/22/2003 | 31,354 | (25) | 23,333 | 8,021 | 0 | * | ||||||||||||||
John Avon | 52,056 | 25,372 | 6,684 | 20,000 | * | |||||||||||||||
John E. Dittoe | 85,325 | 63,935 | 21,390 | 0 | * | |||||||||||||||
John Anthony Nole | 1,444 | 0 | 1,444 | 0 | * | |||||||||||||||
Johnson Family Revocable Living Trust | 32,245 | (26) | 25,561 | 6,684 | 0 | * | ||||||||||||||
Joshua Kaikov | 1,805 | 0 | 1,805 | 0 | * | |||||||||||||||
Juha Tuominen and Stacey S. Tuominen | 42,140 | 34,119 | 8,021 | 0 | * | |||||||||||||||
Justin Dyer | 32,119 | 25,435 | 6,684 | 0 | * | |||||||||||||||
Kathleen E. Watkins | 35,056 | 28,372 | 6,684 | 0 | * | |||||||||||||||
Keith Gelles | 108,141 | 88,141 | 20,000 | 0 | * | |||||||||||||||
Keith Wright | 72,867 | 59,499 | 13,368 | 0 | * | |||||||||||||||
Kent H. Elliott and Susan R. Elliott | 70,233 | 56,864 | 13,369 | 0 | * | |||||||||||||||
Kevin Eike | 140,467 | 113,729 | 26,738 | 0 | * | |||||||||||||||
Larry Lindland | 19,665 | 15,922 | 3,743 | 0 | * | |||||||||||||||
Law Office of Kenneth E. Chyten 401(k) Profit Sharing Plan | 55,035 | (27) | 41,666 | 13,369 | 0 | * | ||||||||||||||
LGH Investments, LLC | 132,733 | (28) | 105,995 | 26,738 | 0 | * | ||||||||||||||
Llano Resources Inc. | 27,517 | (29) | 20,833 | 6,684 | 0 | * | ||||||||||||||
Lorraine Maxfield | 6,170 | 0 | 4,468 | 1,702 | * | |||||||||||||||
Malcolm Alexander Winks | 11,496 | 0 | 11,496 | 0 | * | |||||||||||||||
Marc Herman | 36,714 | 30,030 | 6,684 | 0 | * | |||||||||||||||
Mason Sexton | 6,418 | 0 | 6,418 | 0 | * | |||||||||||||||
Matthew Rea & Julie Bigler JT WROS | 71,013 | 57,644 | 13,369 | 0 | * | |||||||||||||||
Merri Moken | 128,982 | 102,244 | 26,738 | 0 | * | |||||||||||||||
Michael Chieco | 64,050 | 50,682 | 13,368 | 0 | * | |||||||||||||||
Michael G. Ginder | 31,769 | 25,085 | 6,684 | 0 | * | |||||||||||||||
Michael Koutsoudakis | 1,204 | 0 | 1,204 | 0 | * | |||||||||||||||
Mike D. Walker | 109,474 | 82,736 | 26,738 | 0 | * | |||||||||||||||
MIS Equity Strategies, LP | 27,566 | (30) | 20,882 | 6,684 | 0 | * | ||||||||||||||
Mustafa Ameenudin | 132,865 | 16,666 | 0 | 116,199 | * | |||||||||||||||
Natan Vishlitzky & Miryam Vishlitzky JTWROS | 62,711 | (31) | 0 | 13,369 | 49,342 | * | ||||||||||||||
Nathan E. Davis | 12,798 | 10,124 | 2,674 | 0 | * | |||||||||||||||
Nick Panayotou | 900,696 | 720,696 | 180,000 | 0 | * | |||||||||||||||
Northlea Partners, Ltd. | 21,906 | 16,558 | 5,348 | 0 | * |
11
Number of Shares of Common Stock Beneficially Owned | Shares | Beneficial Ownership After Offering | ||||||||||||||||||
Name of Selling Stockholder | Prior to Offering (1) | Shares Offered | Underlying Warrants | Shares | Ownership Percentage | |||||||||||||||
Paul G. Darr & Dawn Darr | 87,708 | 37,681 | 10,027 | 40,000 | * | |||||||||||||||
Paulson Investment Company, LLC | 143,484 | (32) | 0 | 111,498 | 31,986 | * | ||||||||||||||
Peter Fogarty | 29,310 | 0 | 29,310 | 0 | * | |||||||||||||||
Proactive Capital Partners, L.P. | 75,000 | (33) | 75,000 | 0 | 0 | * | ||||||||||||||
Randall Rehborn and Lisa Rehborn | 31,805 | 25,121 | 6,684 | 0 | * | |||||||||||||||
Raphael Tshibangu | 25,545 | 20,197 | 5,348 | 0 | * | |||||||||||||||
Richard Jeanneret | 127,976 | 101,238 | 26,738 | 0 | * | |||||||||||||||
Robert D. Beck and Debra Beck JT WROS | 69,687 | 56,318 | 13,369 | 0 | * | |||||||||||||||
Robert F. Susie | 78,539 | 50,170 | 13,369 | 15,000 | * | |||||||||||||||
Robert G. Dodge | 181,727 | 148,305 | 33,422 | 0 | * | |||||||||||||||
Robert L. Bahr Revocable Trust 1985 | 49,472 | (34) | 37,440 | 12,032 | 0 | * | ||||||||||||||
Robert Lanphere Jr. | 280,489 | 227,013 | 53,476 | 0 | * | |||||||||||||||
Robert Setteducati | 190,317 | 0 | 112,839 | 77,478 | * | |||||||||||||||
Robert W. W. Biederman | 31,805 | 25,121 | 6,684 | 0 | * | |||||||||||||||
Roger Natsuhara and Karen Natsuhara JT WROS | 64,114 | 50,745 | 13,369 | 0 | * | |||||||||||||||
S. Bruce Lansky Rev Trust | 36,282 | (35) | 29,598 | 6,684 | 0 | * | ||||||||||||||
Shashank Upadhye | 27,382 | 20,698 | 6,684 | 0 | * | |||||||||||||||
Stephen Kann | 47,568 | 0 | 10,168 | 37,400 | * | |||||||||||||||
Stephen Shumpert | 109,899 | 83,161 | 26,738 | 0 | ||||||||||||||||
Steven Romero Delgado | 31,993 | 25,309 | 6,684 | 0 | * | |||||||||||||||
Strata Trust Company Cust FBO Alexander Tosi IRA | 551,672 | 338,191 | 86,898 | 126,583 | * | |||||||||||||||
Strata Trust Company Cust FBO Michael E. Williams IRA | 34,985 | 28,301 | 6,684 | 0 | * | |||||||||||||||
Strata Trust Company Cust FBO Roger Walt Langeliers IRA | 293,797 | 240,321 | 53,476 | 0 | * | |||||||||||||||
Strata Trust Company Cust FBO Thomas C Rolfstad IRA | 139,566 | 113,898 | 25,668 | 0 | * | |||||||||||||||
The Bahr Family Limited Partnership | 60,462 | (36) | 45,757 | 14,705 | 0 | * | ||||||||||||||
The Childers Living Trust | 64,491 | (37) | 51,122 | 13,369 | 0 | * | ||||||||||||||
Thomas Endres | 1,204 | 0 | 1,204 | 0 | * | |||||||||||||||
Thomas H. Butcher | 32,299 | 25,615 | 6,684 | 0 | * | |||||||||||||||
Thomas Parigian | 112,839 | 0 | 112,839 | 0 | * | |||||||||||||||
Thomas Rowan | 32,119 | 25,435 | 6,684 | 0 | * | |||||||||||||||
Timothy Dabulis | 2,106 | 0 | 2,106 | 0 | ||||||||||||||||
Trent Davis | 11,496 | 0 | 11,496 | 0 | ||||||||||||||||
Troy O’Bryan | 62,520 | 49,152 | 13,368 | 0 | * | |||||||||||||||
Veronica Marano & Thomas M. Volckening JTWROS | 55,134 | 41,765 | 13,369 | 0 | * | |||||||||||||||
Vijay Patel & Tejal Patel, Tenants by the Entirety | 63,539 | 50,170 | 13,369 | 0 | * | |||||||||||||||
Vista Capital Investments LLC | 132,957 | (38) | 106,219 | 26,738 | 0 | * | ||||||||||||||
Wamoh, LLC | 95,308 | (39) | 75,255 | 20,053 | 0 | * | ||||||||||||||
Wayne Westerman | 52,670 | 39,302 | 13,368 | 0 | * | |||||||||||||||
William Martin Stocker, III | 157,536 | (40) | 41,765 | 26,738 | 89,033 | * | ||||||||||||||
William Murphy | 549,961 | 243,116 | 66,845 | 240,000 | 1.1 | % |
* | Less than 1%. |
(1) | Beneficial ownership is determined in accordance with Rule 13d-3 under the Securities Act, and includes any shares of Common Stock as to which the Selling Stockholder has sole or shared voting power or investment power, and also any shares which the Selling Stockholder has the right to acquire within 60 days of August 4, 2020, whether through the exercise or conversion of any stock option, convertible security, warrant or other right. The indication herein that shares are beneficially owned is not an admission on the part of the Selling Stockholder that he, she or it is a direct or indirect beneficial owner of those shares. |
(2) | Based upon 22,052,294 shares of Common Stock issued and outstanding as of August 4, 2020. |
12
(3) | Dale Powell and Katharine Powell have shared voting control and investment discretion over the securities reported herein that are held by 4P’s Enterprises, LLC. |
(4) | Brian M. Miller has voting control and investment discretion over the securities reported herein that are held by Alliance Trust Company, CUST FBO Brian Mark Miller ROTH IRA. |
(5) | Patrick M. Mullin, as Managing Member, has voting control and investment discretion over the securities reported herein that are held by Ardara Capital LP. |
(6) | Katherine Barton has voting control and investment discretion over the securities reported herein that are held by BCS Capital LLC. |
(7) | Russell Lieblick has voting control and investment discretion over the securities reported herein that are held by Beacon Investment LLC. |
(8) | Bradley Abeson and Lori Abeson share voting control and investment discretion over the securities reported herein that are held by the Bradley & Lori Abeson Rev Family Trust. |
(9) | Includes 94,954 shares issuable upon the conversion of outstanding 2019 Notes, assuming such 2019 Notes were converted as of August 4, 2020. The actual amount of shares received upon such conversion may vary. |
(10) | George Reid Calcott has voting control and investment discretion over the securities reported herein that are held by the Calcott Family Trust. |
(11) | Curtis D. Walker has voting control and investment discretion over the securities reported herein that are held by CD Walker LLC. |
(12) | Taylor A. Chess, as trustee of the trust, has voting control and investment discretion over the securities reported herein that are held by the Chess Family Trust. |
(13) | Jack Chitayat has voting control and investment discretion over the securities reported herein that are held by Chitayat Holdings, LLC. |
(14) | Robert Ertner has voting control and investment discretion over the securities reported herein that are held by Collegiate Tutoring, Inc. |
(15) | Craig Bordon has voting control and investment discretion over the securities reported herein that are held by Asset Recovery Association, Inc. |
(16) | Eric J. Schlanger has voting control and investment discretion over the securities reported herein that are held by District 2 Capital Fund LP. Includes 345,278 shares issuable upon the conversion of outstanding 2019 Notes, assuming such 2019 Notes were converted as of August 4, 2020. The actual amount of shares received upon such conversion may vary. |
(17) | Douglas Harnar has voting control and investment discretion over the securities reported herein that are held by Douglas Harnar LLC. |
(18) | Robert S. Beadle has voting control and investment discretion over the securities reported herein that are held by Due Mondi Investments, Ltd. |
(19) | Pinny Rotter has voting control and investment discretion over the securities reported herein that are held by Efrat Investments LLC. |
(20) | James S. Painter III has voting control and investment discretion over the securities reported herein that are held by Emerging Markets Consulting, LLC. |
(21) | Ernest W. Moody, as trustee of the trust, has voting control and investment discretion over the securities reported herein that are held by Ernest W. Moody Revocable Trust. |
13
(22) | Gregory B. Stewart, as trustee of the trust, has voting and dispositive power over the securities reported herein that are held by the GBS Living Trust. |
(23) | Gregory H. Blaine has voting control and investment discretion over the securities reported herein that are held by Blaine 2000 Revocable Trust. |
(24) | Jack C. Holland has voting control and investment discretion over the securities reported herein that are held by Jack Cavin Holland 1979 Trust. |
(25) | Joel Yanowitz has voting control and investment discretion over the securities reported herein that are held by Joel Yanowitz and Amy Metzenbaum Trust UTA 7/22/2003. |
(26) | David Richard Johnson, as trustee of the trust, has voting control and investment discretion over the securities reported herein that are held by Johnson Family Revocable Living Trust. |
(27) | Kenneth E. Chyten has voting control and investment discretion over the securities reported herein that are held by Law Office of Kenneth E. Chyten 401(k) Profit Sharing Plan. |
(28) | Lucas Hoppel, as Managing Member, has voting control and investment discretion over the securities reported herein that are held by LGH Investments, LLC. |
(29) | Burton Mark Paul has voting control and investment discretion over the securities reported herein that are held by Llano Resources Inc. |
(30) | Anthony Reed, as the Manager of the General Partner, has voting control and investment discretion over the securities reported herein that are held by MIS Equity Strategies, LP. |
(31) | Includes 49,342 shares issuable upon the conversion of outstanding 2019 Notes, assuming such 2019 Notes were converted as of August 4, 2020. The actual amount of shares received upon such conversion may vary. |
(32) | Trent Donald Davis has voting control and investment discretion over the securities reported herein that are held by Paulson Investment Company, LLC. |
(33) | Jeffrey Ramson has voting control and investment discretion over the securities reported herein that are held by Proactive Capital LP. |
(34) | Robert Lawrence Bahr has voting control and investment discretion over the securities reported herein that are held by Robert L. Bahr Revocable Trust 1985. |
(35) | S. Bruce Lansky, as trustee of the trust, has voting control and investment discretion over the securities reported herein that are held by S. Bruce Lansky Rev Trust. |
(36) | Robert Lawrence Bahr has voting control and investment discretion over the securities reported herein that are held by The Bahr Family Limited Partnership. |
(37) | William A. and Dolores M. Childers, as trustees of the trust, share voting control and investment discretion over the securities reported herein that are held by The Childers Living Trust. |
(38) | David Clark has voting control and investment discretion over the securities reported herein that are held by Vista Capital Investments LLC. |
(39) | Arthur Dale Burns has voting control and investment discretion over the securities reported herein that are held by Wamoh, LLC. |
(40) | Includes 49,033 shares issuable upon the conversion of outstanding 2019 Notes, assuming such 2019 Notes were converted as of August 4, 2020. The actual amount of shares received upon such conversion may vary. |
14
DESCRIPTION OF DISTRIBUTION AND SELLING SECURITY HOLDERS
SECURITIES TO BE REGISTERED
This prospectus relates to the saleresale from time to time of 10,000,000 commonup to 10,883,808 shares of Common Stock of the Company by Original Sourcethe Selling Stockholders listed on page 9. As described below under “About this Prospectus” and 1,500,000“Prospectus – Summary About this Offering,” the shares beingof our Common Stock registered by selling
shareholders.
There has been no market for our securities. Our common stock is not
traded on any exchange or on the over-the-counter market. After the
effective date of the registration statement relating to this prospectus we hopeinclude (i) 2,155,435 2019 Conversion Shares, 66,583 additional shares issued to have a market maker file an application with
FINRA for our common stock to be eligible for trading on the over-the-
counter market. We do not yet have a market maker who has agreed to
file such application.
Primary Offering
We will sell the 10,000,000 commoninvestor, 864,913 shares ourselves and do not plan to
use underwriters or pay any commissions. We will be selling our common
shares using our best efforts and no one has agreed to buy any of our common shares. ThisCommon Stock issuable upon the exercise of 2019 Paulson Warrants, and 253,583 shares of Common Stock issuable upon the exercise of 2019 Broker Warrants, (ii) 5,566,744 2020 Conversion Shares, 1,356,321 shares of our Common Stock issuable upon the exercise of 2020 Paulson Warrants, and 403,563 shares of Common Stock issuable upon the exercise of 2020 Broker Warrants and (iii) 216,666 shares of our Common Stock issued to investors in the Common Stock Offerings. We are not selling any shares of Common Stock under this prospectus permits our officers and directors to
sell the common shares directly to the public, with no commission or
other remuneration payable to them forwill not receive any common shares they may sell.
There is no plan or arrangement to enter into any contracts or
agreements to sell the common shares with a broker or dealer. Our
officers and directors will sell the common shares and intend to offer
them to friends, family members and business acquaintances.
There is no minimum amount of common shares we must sell so no money
raisedproceeds from the sale of our common shares will go into escrow, trust or
another similar arrangement.
of Common Stock by the Selling Stockholders.
The common shares are being offered by Ms. Lecia L. Walker and E. Lynn
Atwood, officers and directorsCompany’s authorized capital stock consists of the registrant. Mmes. Walker and
Atwood will be relying on the safe harbor in Rule 3a4-1 of the
Securities Exchange Act of 1934 to sell the common shares. No sales
14
commission will be paid for common shares sold by Mmes. Walker and
Atwood. Mmes. Walker and Atwood are not subject to a statutory
disqualification and are not associated persons of a broker or dealer.
Additionally, Mmes. Walker and Atwood primarily perform substantial
duties on behalf of the registrant otherwise than in connection with
transactions in securities. Neither Ms. Walker nor Ms. Atwood were a
broker or dealer or an associated person of a broker or dealer within
the preceding 12 months and they have not participated in selling an
offering of securities for any issuer more than once every 12 months
other than in reliance on paragraph (a)4(i) or (a)4(iii) of Rule 3a4-1
of the Securities Exchange Act of 1934.
These are no finders.
Secondary Offering
This prospectus also relates to the resale of 1,500,000100,000,000 shares of common stock, par value of $0.001 per share, and 10,000,000 shares of preferred stock, par value $0.001 per share.
Common Stock
Holders of the Company’s Common Stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of Common Stock do not have cumulative voting rights. Therefore, holders of a majority of the shares of Common Stock voting for the election of directors can elect all of the directors. Holders of the Company’s Common Stock representing a majority of the voting power of the Company’s capital stock issued, outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of stockholders. A vote by the selling security holders.holders of a majority of the Company’s outstanding Common Stock is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment to the Company’s certificate of incorporation.
Holders of the Company’s Common Stock are entitled to share in all dividends that the Company’s board of directors, in its discretion, declares from legally available funds. In the event of a liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference over the Common Stock. The selling security holders will sellCompany’s Common Stock has no pre-emptive rights, no conversion rights and there are no redemption provisions applicable to the Company’s Common Stock.
The Company’s certificate of incorporation authorize the issuance of 10,000,000 shares of “blank check” preferred stock, par value $0.001 per share, in one or more series, subject to any limitations prescribed by law, without further vote or action by the stockholders. Each such series of preferred stock shall have such number of shares, designations, preferences, voting powers, qualifications, and special or relative rights or privileges as shall be determined by our board of directors, which may include, among others, dividend rights, voting rights, liquidation preferences, conversion rights and preemptive rights.
Anti-Takeover Provisions
We are subject to Section 203 of the Delaware General Corporation Law, or Section 203. Section 203 generally prohibits a public Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless:
● | prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; |
● | the interested stockholder owned at least 85% of the voting stock of the corporation outstanding upon consummation of the transaction, excluding for purposes of determining the number of shares outstanding (a) shares owned by persons who are directors and also officers and (b) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or |
15
● | on or subsequent to the consummation of the transaction, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder. |
Section 203 defines a business combination to include:
● | any merger or consolidation involving the corporation and the interested stockholder; |
● | any sale, transfer, pledge or other disposition involving the interested stockholder of 10% or more of the assets of the corporation; |
● | subject to exceptions, any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; |
● | subject to exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder; and |
● | the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation. |
In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by the entity or person.
Certificate of Incorporation and Bylaws
Provisions of our certificate of incorporation and bylaws may delay or discourage transactions involving an actual or potential change in our control or change in our management, including transactions in which stockholders might otherwise receive a premium for their common shares at $.05 per
common shares untilor transactions that our common shares are quoted on a market or
securities exchange. Thereafter,stockholders might otherwise deem to be in their best interests. Therefore, these provisions could adversely affect the common shares may be priced at
prevailing market prices or privately negotiated prices.
If the selling security holders engage in short selling activities,
they must complyprice of our Common Stock. Among other things, our certificate of incorporation and bylaws:
● | permit our board of directors to issue up to 10,000,000 shares of preferred stock, with any rights, preferences and privileges as they may designate; |
● | provide that the authorized number of directors may be changed only by resolution adopted by a majority of the board of directors; |
● | provide that the board of directors or any individual director may only be removed with cause and the affirmative vote of the holders of at least 66 2/3% of the voting power of all of our then outstanding capital stock; |
● | provide that all vacancies, including newly created directorships, may, except as otherwise required by law or subject to the rights of holders of preferred stock as designated from time to time, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum; |
● | divide our board of directors into three classes; |
16
● | require that any action to be taken by our stockholders must be effected at a duly called annual or special meeting of stockholders and not be taken by written consent or electronic transmission; |
● | provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner and also specify requirements as to the form and content of a stockholder’s notice; |
● | do not provide for cumulative voting rights, which means that holders of a majority of the shares of Common Stock entitled to vote in any election of directors can elect all of the directors standing for election; |
● | provide that special meetings of our stockholders may only be called by the chairman of the board of directors, our Chief Executive Officer or by the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors (whether or not any vacancies exist); and |
● | provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors or officers to us or our stockholders, (iii) any action asserting a claim against us arising pursuant to any provision of the DGCL, or (iv) any action asserting a claim against us governed by the internal affairs doctrine. |
The amendment of any of these provisions, with the prospectus delivery requirementsexception of Section
5(b)(2) of the Securities Act.
Pursuant to Regulation M of the Securities Act, the selling security
holders will not, directly or indirectly, bid for, purchase, or attempt
to induce any person to bid for or purchase their common shares during
the offering except for offers to sell or the solicitation of offers to
buy and unsolicited purchases that are not effected from or through a
broker or dealer, on a securities exchange or through an inter-dealer
quotation system or electronic communications network.
These requirements may restrict the ability of broker/dealersour board of directors to sell
our commonissue shares of preferred stock and may affectdesignate any rights, preferences and privileges thereto, would require the ability to resellaffirmative vote of the holders of at least 66 2/3% of the voting power of all of our commonthen outstanding capital stock.
The 1,500,000 common
17
This prospectus includes 10,883,808 shares of Common Stock offered by the selling security holdersSelling Stockholders.
Each Selling Stockholder and any of its pledgees, assignees and successors-in-interest may, from time to time, sell any or all of its shares of Common Stock on the OTCQB or any other stock exchange, market or trading facility on which our shares are traded or in private transactions. These sales may be sold byat fixed or negotiated prices. A selling stockholder may use any one or more of the following methods without limitation:
- ordinary brokerage transactions and transactions in which the
broker solicits purchases; and
- face-to-face transactions between sellers and purchasers without
a broker-dealer. In effecting sales, brokers or dealers engaged by thewhen selling security holdersshares:
● | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
● | block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
● | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
● | an exchange distribution in accordance with the rules of the applicable exchange; |
● | privately negotiated transactions; |
● | settlement of short sales entered into after the effective date of the registration statement of which this prospectus is a part; |
● | broker-dealers may agree with the Selling Stockholders to sell a specified number of such shares at a stipulated price per share; |
● | through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
● | a combination of any such methods of sale; or |
● | any other method permitted pursuant to applicable law. |
The Selling Stockholders may arrange for other brokers or dealers to
participate.
The selling security holder or dealer effecting a transaction in the
registered securities, whether or not participating in a distribution,
is required to deliver a prospectus.
Underalso sell shares under Rule 144 under the Securities Act, if available, rather than under this prospectus.
In addition, the Selling Stockholders may transfer the shares of 1933,Common Stock by other means not described in this prospectus. If the Selling Stockholders effect such transactions by selling security holders will be
consideredshares of Common Stock to beor through underwriters, of the offering. The selling security
holdersbroker-dealers or agents, such underwriters, broker-dealers or agents may have civil liability under Section 11 and 12 of the
Securities Act for any omissions or misstatementsreceive commissions in the registration
15
statement becauseform of their status as underwriters. We may be sued by
selling security holders if omissionsdiscounts, concessions or misstatements result in civil
liability to them.
Once a market has been developed for our common stock,commissions from the shares may
be soldSelling Stockholders or distributedcommissions from time to time by the security holders
directly to one or more purchasers or through brokers or dealers who
act solely as agents, at market prices prevailing at the time of sale,
at prices related to such prevailing market prices, at negotiated
prices or at fixed prices, which may be changed. The distribution of the shares of Common Stock for whom they may act as agent or to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers or agents may be effected in one or moreexcess of the following methods: (a)
ordinary brokerage transactions and transactions in which the broker
solicits purchasers; (b) privately negotiated transactions; (c) market
sales (both long and short to the extent permitted under the federal
securities laws); (d) at the market to or through market makers or into
an existing market for the shares; (e) through transactions in options,
swaps or other derivatives (whether exchange listed or otherwise); and
(f) a combination of any of the aforementioned methods of sale.
In effecting sales, brokers and dealers engaged by the selling security
holders may arrange for other brokers or dealers to participate.
Brokers or dealers may receive commissions or discounts from a selling
security holder or, if any of the broker-dealers act as an agent for
the purchaser of such shares, from a purchaser in amounts to be
negotiated which are not expected to exceed those customary in the types of transactions involved. Broker-dealers may agreeinvolved). In connection with a selling
security holder to sell a specified numbersales of the shares of common
stock at a stipulated price per share. Such an agreementCommon Stock or otherwise, the Selling Stockholders may enter into hedging transactions with broker-dealers, which may in turn engage in short sales of the shares of Common Stock in the course of hedging in positions they assume. The Selling Stockholders may also require the broker-dealer to purchase as principal any unsoldsell shares of common stock atCommon Stock short and deliver shares of Common Stock covered by this prospectus to close out short positions and to return borrowed shares in connection with such short sales. The Selling Stockholders may also loan or pledge shares of Common Stock to broker-dealers that in turn may sell such shares.
18
The Selling Stockholders may pledge or grant a security interest in some or all of the price required to fulfillshares of Common Stock owned by them and, if they default in the broker-dealer
commitment toperformance of their secured obligations, the selling security holder if such broker-dealer is
unable topledgees or secured parties may offer and sell the shares on behalf of the selling security holder.
Broker-dealers who acquire shares of common stock as principal may
thereafter resell the shares of common stockCommon Stock from time to time in
transactions which may involve block transactions and salespursuant to and
throughthis prospectus or any amendment to this prospectus under Rule 424(b)(3) or other broker-dealers, including transactionsapplicable provision of the nature
described above. Such sales by a broker-dealer could be at pricesSecurities Act amending, if necessary, the list of Selling Stockholders to include the pledgee, transferee or other successors in interest as Selling Stockholders under this prospectus. The Selling Stockholders also may transfer and on terms then prevailing at the time of sale, at prices related to the
then-current market price or in negotiated transactions. In connection
with such re-sales, the broker-dealer may pay to or receive from the
purchasers ofdonate the shares commissions as described above.
The security holdersof Common Stock in other circumstances in which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.
To the extent required by the Securities Act and the rules and regulations thereunder, the Selling Stockholders and any broker-dealers or agents that participate
with the security holdersbroker-dealer participating in the saledistribution of the shares of common stockCommon Stock may be deemed to be "underwriters"“underwriters” within the meaning of the Securities Act, in connection with these sales. In that event, any commissions received
by the broker-dealers or agents and any profit on the resale of the
shares of common stock purchased by themcommission paid, or any discounts or concessions allowed to, any such broker-dealer may be deemed to be underwriting commissions or discounts under the Securities Act. At the time a particular offering of the shares of Common Stock is made, a prospectus supplement, if required, will be distributed, which will set forth the aggregate amount of shares of Common Stock being offered and the terms of the offering, including the name or names of any broker-dealers or agents, any discounts, commissions and other terms constituting compensation from the Selling Stockholders and any discounts, commissions or concessions allowed or re-allowed or paid to broker-dealers.
There can be no assurance that any Selling Stockholder will sell any or all of the shares of Common Stock registered pursuant to the registration statement, of which this prospectus is a part.
The Selling Stockholders and any other person participating in such distribution will be subject to applicable provisions of the Exchange Act, and the rules and regulations thereunder, including, without limitation, to the extent applicable, Regulation M of the Exchange Act, which may limit the timing of purchases and sales of any of the shares of Common Stock by the Selling Security Holders
Stockholders and any other participating person. To the extent applicable, Regulation M may also restrict the ability of any person engaged in the distribution of the shares of Common Stock to engage in market-making activities with respect to the shares of Common Stock. All of the foregoing may affect the marketability of the shares of Common Stock and the ability of any person or entity to engage in market-making activities with respect to the shares of Common Stock. We will pay all expenses of the registration of the shares of Common Stock.
Once sold under the registration statement, of which this prospectus is a part, the shares of Common Stock will be freely tradable in the hands of persons other than our affiliates.
19
The table below setsvalidity of the securities offered hereby have been passed upon for us by Honigman LLP, Kalamazoo, Michigan.
The consolidated financial statements of the Company as of September 30, 2019 and 2018, and for the year ended September 30, 2019 and for the nine month transition period ended September 30, 2018 incorporated by reference in this prospectus have been so incorporated in reliance on the report of BDO USA, LLP, an independent registered public accounting firm (the report on the consolidated financial statements contains an explanatory paragraph regarding the Company’s ability to continue as a going concern) incorporated herein by reference, given on the authority of said firm as experts in auditing and accounting.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
Federal securities laws require us to file information with the SEC concerning our business and operations. Accordingly, we file proxy statements and annual, quarterly, and special reports, and other information with the Commission.
The SEC maintains a web site (http://www.sec.gov) at which you can read or download our reports and other information.
We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the securities being offered hereby. As permitted by the rules and regulations of the SEC, this prospectus does not contain all the information set forth in the registration statement and the exhibits and schedules thereto. For further information with respect to the resaleCompany and the securities offered hereby, reference is made to the registration statement, and such exhibits and schedules which may be accessed at the SEC’s web site.
20
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
SEC rules allow us to “incorporate by reference” into this prospectus much of sharesthe information we file with the SEC, which means that we can disclose important information to you by referring you to those publicly available documents. The information that we incorporate by reference into this prospectus plus consolidated financial statements included in this prospectus is considered to be part of this prospectus. These documents may include Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy statements. You should read the information incorporated by reference because it is an important part of this prospectus.
This prospectus incorporates by reference the documents listed below, other than those documents or the portions of those documents deemed to be furnished and not filed in accordance with SEC rules:
● | our Annual Report on Form 10-K for the fiscal year ended September 30, 2019, filed with the SEC on December 20, 2019 as amended on January 28, 2020; |
● | our Quarterly Reports on Form 10-Q for the quarter ended December 31, 2019, filed with the SEC on February 14, 2020 and the quarter ended March 31, 2020, filed with the SEC on May 14, 2020; |
● | our Current Reports on Form 8-K filed with the SEC on October 11, 2019, October 25, 2019, October 29, 2019, November 7, 2019, December 2, 2019, December 4, 2019, December 11, 2019, December 31, 2019, January 24, 2020, February 24, 2020, April 30, 2020, May 1, 2020, May 12, 2020, June 4, 2020, July 2, 2020, July 22, 2020, July 28, 2020 and August 3, 2020; and |
● | the description of our common stock in Exhibit 4.1 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2019, filed on December 20, 2019. |
Any statement contained in any document incorporated by reference herein shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or any prospectus modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
We also incorporate by reference any future filings, other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that are related to such items, made with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, in each case, other than those documents or the portions of those documents deemed to be furnished and not filed in accordance with SEC rules, until the offering of the securities under the registration statement of which this prospectus forms a part is terminated or completed. Information in such future filings updates and supplements the information provided in this prospectus. Any statements in any such future filings will be deemed to modify and supersede any information in any document we previously filed with the SEC that is incorporated or deemed to be incorporated herein by reference to the extent that statements in the later filed document modify or replace such earlier statements.
Because we are incorporating by reference future filings with the SEC, this prospectus is continually updated and later information filed with the SEC may update and supersede some of the information included or incorporated by reference in this prospectus. This means that you must look at all of the SEC filings that we incorporate by reference to determine if any of the statements in this prospectus or in any document previously incorporated by reference have been modified or superseded.
These documents may also be accessed on our website at www.n1mtc.com/investors. Information contained in, or accessible through, our website is not a part of this prospectus. We will provide without charge to each person, including any beneficial owners, to whom this prospectus is delivered, upon his or her written or oral request, a copy of any or all reports or documents referred to above which have been or may be incorporated by reference into this prospectus but not delivered with this prospectus, excluding exhibits to those reports or documents unless they are specifically incorporated by reference into those documents. You may request a copy of these documents by writing or telephoning us at the following address.
NeuroOne Medical Technologies Corporation
7559 Anagram Drive
Eden Prairie, Minnesota 55344
(952) 426-1383
Attention: Leah Noaeill
Senior Director of Marketing
LeahN@N1MTC.com
21
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table sets forth all costs and expenses, other than underwriting discounts and commissions, payable by the selling security holders. We will not
receive any proceeds fromCompany, or the resale of common stock by the selling
security holders for shares currently outstanding.
16
Original Source shall register, pursuant to this prospectus 1,500,000
common shares currently outstanding for the account of 3 individuals or
entities. The percentage owned prior to and after the offering assumesRegistrant, in connection with the sale of all of the common sharesstock being registered on behalfregistered. The selling stockholders will not bear any portion of such expenses. All amounts shown are estimates except for the selling security holders.
# of Shares Total Shares Total Shares
Being Before After % After
Registered Offering Offering Offering
E. Lynn Atwood(1) 500,000 500,000 0 0%
Linda Rock 500,000 500,000 0 0%
Sheri Sabey 500,000 500,000 0 0%
(1) E. Lynn AtwoodSEC registration fee.
Nature of Expense | Amount | |||
SEC registration fee | $ | 2,550 | ||
Accounting fees and expenses | 15,000 | |||
Legal fees and expenses | 30,000 | |||
Transfer agent’s fees and expenses | 1,000 | |||
Printing and related fees | 2,500 | |||
Miscellaneous | 10,000 | |||
Total | $ | 61,050 |
Item 14. Indemnification of Directors and Officers.
The Company is an officer and director of the registrant. Ms.
Atwood is the mother of Lecia L. Walker, an officer and director of the
registrant.
Penny Stock
Under the rules of the Securities and Exchange Commission, our common
stock will come within the definition of a "penny stock" because the
price of our common stock on the OTC Bulletin Board is below $5.00 per
share. As a result, our common stock will be subject to the "penny
stock" rules and regulations. Broker-dealers who sell penny stocks to
certain types of investors are required to comply with the Commission's
regulations concerning the transfer of penny stock. These regulations
require broker-dealers to:
- Make a suitability determination prior to selling penny stock to
the purchaser;
- Receive the purchaser's written consent to the transaction; and
- Provide certain written disclosures to the purchaser.
DESCRIPTION OF BUSINESS
We were incorporated under the laws of the State of Nevada on August
20, 2009. WeDelaware. Section 145 of the Delaware General Corporation Law provides that a Delaware corporation may indemnify any persons who were, are, or are threatened to be made, parties to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person is or was an officer, director, employee or agent of such corporation, or is or was serving at the request of such corporation as an officer, director, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided that such person acted in good faith and in a development stage company, formedmanner he or she reasonably believed to license songsbe in or not opposed to the televisioncorporation’s best interests and, movie industry. From our inceptionwith respect to date, we
have generated very little revenues, and our operations have been
limited to organizational, start-up, and capital formation
activities. We currently have no employees other than our officers,
who are also our directors.
We have never declared bankruptcy, have never been in receivership, and
have never been involved in any legalcriminal action or proceedings. We have
notproceeding, had no reasonable cause to believe that his or her conduct was illegal. A Delaware corporation may indemnify any persons who were, are, or are threatened to be made, a party to any significant purchasethreatened, pending or sale of assets, nor hascompleted action or suit by or in the registrant been involved in any mergers, acquisitions or
consolidations. We are not a blank check registrant as that term is
defined in Rule 419(a)(2) of Regulation Cright of the Securities Act of
1933, because we have a specific business plan and purpose. Neither
Original Source Music, Inc., nor its officers, directors, promoters or
affiliates, has had preliminary contact or discussions with, nor do we
have any present plans, proposals, arrangements or understandings with
any representativescorporation by reason of the ownersfact that such person is or was a director, officer, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit provided such person acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the corporation’s best interests except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where an officer or director is successful on the merits or otherwise in the defense of any businessaction referred to above, the corporation must indemnify him or company regardingher against the possibilityexpenses (including attorneys’ fees) actually and reasonably incurred.
The Company’s certificate of an acquisition or merger.
17
License and Assignment Agreement. In 2000, Lecia L. Walker was
heavily involved in launching Private Wavs, a successful music library
which licenses music to television and film, along with her husband at
that time. Part of her roll in that endeavor was to do the market
research, product and packaging design, sales and marketing. In 2007,
she sold her interest in Private Wavs and in 2008, started a new music
library under a DBA of Original Source Music. Since that time she has
placed more than 1,100 songs under contract.
On August 21, 2009, Lecia Walker granted a license for a period of ten
(10) yearsincorporation provides for the entire listindemnification of songsits directors to the registrantfullest extent permitted under a
Licensethe Delaware General Corporation Law. The Company’s bylaws provide for the indemnification of its directors and Assignment Agreement. Pursuantofficers to the License and
Assignment Agreement, Ms. Walker was issued 3,000,000 common sharesfullest extent permitted under the Delaware General Corporation Law.
II-1
Section 102(b)(7) of the registrant
Lecia L. Walker is now an officer andDelaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the registrant,
bringing her experiencecorporation shall not be personally liable to the registrant, and intendscorporation or its stockholders for monetary damages for breach of fiduciary duties as a director, except for liability for any:
● | transaction from which the director derives an improper personal benefit; |
● | act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; |
● | unlawful payment of dividends or redemption of shares; or |
● | breach of a director’s duty of loyalty to the corporation or its stockholders. |
The Company’s certificate of incorporation includes such a provision. Under the Company’s bylaws, expenses incurred by any director or officers in defending any such action, suit or proceeding in advance of its final disposition shall be paid by the Company upon delivery to continueit of an undertaking, by or on behalf of such director or officer, to place many new songs under contract and thenrepay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to license those songs tobe indemnified by the television and movie industry.
Convertible Promissory Note. On June 28, 2010,Company, as long as such undertaking remains required by the registrant entered
into a Convertible Promissory Note for an amount of $2,000 with
American Business Services, Inc., a Colorado corporation, an
unaffiliated entity. The promissory note is convertible into common
stockDelaware General Corporation Law.
Section 174 of the registrant at 50%Delaware General Corporation Law provides, among other things, that a director who willfully or negligently approves of an unlawful payment of dividends or an unlawful stock purchase or redemption, may be held liable for such actions. A director who was either absent when the bid price of the stockunlawful actions were approved or dissented at the time of conversion, ifmay avoid liability by causing his or her dissent to such actions to be entered in the stock is quoted on an exchange, or, if the
stock is not quoted on an exchange, at double the par valuebooks containing minutes of the stock. This could result in as much as an additional dilutionmeetings of
1,000,000 shares of stock, if the note was converted prior to the stock
being quoted on an exchange.
Operations
- ----------
We review hundreds of music tracks written, produced, and performed by
unsigned artists, then to contract those songs with the highest quality
and potential for placement in television and film. The registrant
intends to offer a wide variety of instrumental and vocal genres
including pop, rock, R&B, jazz, country, singer/songwriter, new age,
electronic, dance, funk, children's, adult contemporary, and more.
We intend to focus on the source music niche of music licensing, but
provides music for background, and transitional uses as well.
Currently the registrant has more than 1,100 songs available for
licensing, and is in the process of signing several hundred more songs
to be added to the catalog in the near future and will soon be made
available for television and film applications.
The customer has access to these songs in a variety of ways including
logging into our website at www.originalsourcemusic.com where they may
search for several songs that are appropriate for their needs and
download them directly into their production editing program.
Growth Strategy
- ---------------
We will be focusing on the addition of cues and transitional music for
commercials and television programming transitions, something its major
competitors do not seem to do at present. We intend to enter that
market as soon as possible. We intend to examine signing genres of
music that are in demand by potential customers but are not available
18
from its competitors at present. We will also examine the creation of
a recording label to give the general public access to purchasing the
songs in its catalog.
Revenue
- -------
The registrant receives revenues in two ways:
1. Commercial productions pay licensing fees to place a track into
their production.
2. The registrant owns the publishing rights to all of its songs,
and when a production containing a track licensed from the registrant
is aired through a public venue, royalties are paid to the registrant
by the assigned performing rights organization, either ASCAP, BMI, or
SESAC.
Competition
- -----------
The music industry is intensely competitive and fragmented. We will
compete on the basis of price and selection against other small
companies like ours, as well as large companies that have a similar
business and large marketing companies.
Some of our major competitors are:
Heavy Hitters Music: Heavy Hitters Music has been in the music
licensing business for over 30 years and seems to be the pioneer of
the source music niche. Their website boasts a catalog of over
8,500 music tracks. In 2007, former CBS TV executive, Cindy
Slaughter, and her husband, Mark purchased Heavy Hitters.
MasterSource: Mastersource became the first real source music
competitor for Heavy Hitters when it was formed in 1992 by Marc
Ferrari. MasterSource seems to be the first and only competitor
with tracks available to the general public.
Killer Tracks: Killer Tracks has been in business for twenty years
according to their website. They boast 2000 CDs of music available,
yet only a small fraction includes source music. They specialize in
backgdround, score, special FX and studio music.
J2R Music: J2R Music has a variety of source music for licensing
to television and film.
Free Play Music: Free Play Music has a large variety of production
music, and a growing number of source music tracks. Although their
name indicates the music is free, it is not free for commercial
use.
Sync Free Music: Sync Free Music has a large variety of production
music, and a growing number of source music tracks. Although their
name indicates the music is free, it is not free for commercial
use.
License Jazz: License Jazz is a new company targeting commercial
jazz music needs.
Pump Audio: Pump Audio started in 2001 and has some source music,
but specializes in production and transition music.
19
Patents and Trademarks
- ----------------------
The registrant does not, at this time, have any patents or trademarks.
However, the registrant intends to trademark certain logos which the
registrant will be using.
Governmental Regulations
- ------------------------
The business of the registrant does not fall under any government
regulations.
Employees
- ---------
At this time, we have no employees other than our executive officers,
who are also our directors. All functions including development,
strategy, negotiations and administration are currently being provided
by our executive officers. The executive officers do not intend to
accept any payment for their services from the receipts of this
offering.
As the registrant grows, we may need additional employees for such
operations. We do not foresee any significant changes in the number of
employees or consultants we will have over the next twelve months.
Description of Property
- -----------------------
The registrant executive offices consists of 400 square feet and are
located at 8201 South Santa Fe Drive, Suite 229, Littleton, Colorado,
80120, in space presently leased by the registrant's officers supplied
at no charge to the registrant. The registrant believes that its
current office space will be adequate for the foreseeable future. We
have no plans to lease additional space in the next twelve months.
The address of our principal executive office is c/o Ms. Lecia L.
Walker, Original Source Music, Inc. 8201 South Santa Fe Drive, Suite
229, Littleton, Colorado 80120. Our telephone number is (303) 495-
3728.
Reports to Security Holders
- ---------------------------
We intend to become a fully reporting company under the requirements of
the Exchange Act, and will file the necessary quarterly and other
reports with the Securities and Exchange Commission. Although we will
not be required to deliver our annual or quarterly reports to security
holders, we intend to forward this information to security holders upon
receiving a written request to receive such information. The reports
and other information filed by us will be available for inspection and
copying at the public reference facilities of the Securities and
Exchange Commission located at 100 F Street N.E., Washington, D.C.
20549.
Copies of such material may be obtained by mail from the Public
Reference Section of the Securities and Exchange Commission at 100 F
Street, N.E., Washington, D.C. 20549, at prescribed rates. Information
on the operation of the Public Reference Room may be obtained by
calling the SEC at 1-800-SEC-0330. In addition, the Commission
maintains a World Wide Website on the Internet at: http://www.sec.gov
20
that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the
Securities and Exchange Commission.
USE OF PROCEEDS
Any proceeds received from the sale of our common shares will be
deposited directly into our operating account. We will be attempting
to raise up to $500,000, minus expenses of $20,000, from the sale of
our common shares. These proceeds will be used as follows:
Gross Proceeds $500,000 $300,000
Expenses 20,000 20,000
-------- --------
Net Proceeds $480,000 $280,000
SEC reporting costs 22,500 22,500
Advertising 91,500 51,500
Marketing and promotion 114,375 64,375
Sales team 228,750 128,750
General working capital 22,875 12,875
-------- --------
Net Proceeds $480,000 $280,000
Gross Proceeds $150,000 $75,000
Expenses 20,000 20,000
-------- --------
Net Proceeds $130,000 $ 55,000
SEC reporting costs 22,500 22,500
Advertising 21,500 6,500
Marketing and promotion 26,875 8,125
Sales team 53,750 16,250
General working capital 5,375 1,625
-------- --------
Net Proceeds $130,000 $ 55,000
In the event we are not successful in selling a portion of the
securities to raise at least $75,000, we would give priority to
allocating capital to complete everything necessary to be ready to meet
our SEC reporting requirements. Any remaining capital would be used to
fund our working capital needs. If we are unable to raise the funds
needed, Ms. Walker, an officer and director has agreed to provide the
necessary funds to move forward with the marketing and promotion.
We will not receive any proceeds from the resale of securities by
selling security holders.
DETERMINATION OF OFFERING PRICE
Our common stock is presently not traded on any market or securities
exchange and we have not applied for listing or quotation on any public
market. The offering price does not have any relationship to any
established criteria of value, such as book value or earnings per
share. Because we have no significant operating history and have
generated very little revenue to date, the price of our common stock is
21
not based on past earnings, nor is the price of our common stock
indicative of the current market value of the assets owned by us. No
valuation or appraisal has been prepared for our business and potential
business expansion.
The offering price was determined arbitrarily based on a determination
by the board of directors at the time such action occurred or immediately after such absent director receives notice of the price atunlawful acts.
As permitted by the Delaware General Corporation Law, we have entered into indemnity agreements with each of our directors and executive officers, that require us to indemnify such persons against any and all expenses (including reasonable attorneys’ fees), witness fees, damages, judgments, fines, settlements and other amounts incurred (including expenses of a derivative action) in connection with any action, suit or proceeding, whether actual or threatened, to which they believe investors
wouldany such person may be willing to purchase the shares. Additional factors that were
included in determining the offering price are the lackmade a party by reason of liquidity
resulting from the fact that theresuch person is no present market for our stock
and the high level of risk considering our lack of profitable operating
history.
DILUTION
Assuming completionor was a director, an officer or an employee of the offering, there will be up to 14,500,000
common shares outstanding. The following table illustrates the per
common share dilution that may be experienced by investors at various
funding levels.
There is at present no pending litigation or involuntary liquidation, distribution or sale of
assets, dissolution or winding upproceeding involving any of the registrant,Registrant’s directors or executive officers as to which indemnification is required or permitted, and the holdersCompany is not aware of any threatened litigation or proceeding that may result in a claim for indemnification, other than the common stock shall be entitled to receive all ofletter received by the remaining assets
of the registrant, tangible and intangible, of whatever kind available
for distribution to stock holders, ratablyCompany in proportion to the number
of common shares held by each.
Preferred Stock
- ---------------
The registrant, by resolution of its board of directors, may divide and
issue the preferred stock in series. Preferred stock of each series
when issued shall be designated to distinguish themMay 2017 from the sharesformer employer of allMark Christianson and Wade Fredrickson claiming, among other series. things, certain breaches of non-competition obligations and confidentiality and non-disclosure obligations to such prior employer and federal and state law by virtue of such officers’ work for the Company.
The board ofCompany has an insurance policy that covers its officers and directors is hereby expressly vested
with the authority to divide the class of preferred stock into series
and to fix and determine the relative rights and preferences of the
30
shares of any such series so established to the full extent permitted
by the articles of incorporation and the Nevada Revised Statutes in respect to the following:
1. The number of shares to constitute such series, and the
distinctive designations thereof;
(a) The rate and preference of dividends, if any, the time
of payment of dividends, whether dividends are cumulative and the date
from which any dividend shall accrue;
(b) Whether shares may be redeemed and, if so, the
redemption price and the terms and conditions of redemption;
(c) The amount payable upon shares in event of involuntary
liquidation;
(d) The amount payable upon shares in event of voluntary
liquidation;
(e) Sinking fund or other provisions, if any, for the
redemption or purchase of shares;
(f) The terms and conditions on which shares may be
converted, if the shares of any series are issued with the privilege of
conversion;
(g) Voting powers, if any; and
(h) Any other relative rights and preferences of shares of
such series,certain liabilities, including without limitation, any restriction on an
increase in the number of shares of any series theretofore authorized
and any limitation or restriction of rights or powers to which shares
of any future series shall be subject.
Transfer Agent
- --------------
The registrant acts as its own transfer agent. After completion of
this offering, the registrant intends to retain Mountain Share
Transfer, Inc., Broomfield, Colorado as our transfer agent.
SHARES ELIGIBLE FOR FUTURE SALE
Upon the date of this prospectus, there are 4,500,000 common shares
outstanding of which no common shares may be freely traded without
registration. However, 1,500,000 common shares of present shareholders
are being registered on this offering.
Upon the effectiveness of this registration statement, up to an
additional 10,000,000 common shares may be issued and will be eligible
for immediate resale in the public market.
The remaining 3,000,000 common shares will be restricted within the
meaning of Rule 144 under the Securities Act, and are subject to the
resale provisions of Rule 144.
At the present time, resales or distributions of such shares are
provided for by the provisions of Rule 144. That rule is a so-called
"safe harbor" rule which, if complied with, should eliminate any
questions as to whether or not a person selling restricted shares has
acted as an underwriter.
Rule 144(d)(1) states that if the issuer of the securities is, and has
been for a period of at least 90 days immediately before the sale,
subject to the reporting requirements of section 13 or 15(d) of the
31
Exchange Act, a minimum of six months must elapse between the later of
the date of the acquisition of the securities from the issuer, or from
an affiliate of the issuer, and any resale of such securities.
Sales under Rule 144 are also subject to notice and manner of sale
requirements and to the availability of current public information and
must be made in unsolicited brokers' transactions or to a market maker.
A person who is not an affiliate of Original Source under the
Securities Act during the three months preceding a sale and who has
beneficially owned such shares for at least six months is entitled to
sell the shares under Rule 144 without regard to the volume, notice,
information and manner of sale provisions. Affiliates must comply with
the restrictions and requirements of Rule 144 when transferring
restricted shares even after the six month holding period has expired
and must comply with the restrictions and requirements of Rule 144 in
order to sell unrestricted shares.
No predictions can be made of the effect, if any, that market sales of
shares of common stock or the availability of such shares for sale will
have on the market price prevailing from time to time. Nevertheless,
sales of significant amounts of our common stock could adversely affect
the prevailing market price of the common stock, as well as impair our
ability to raise capital through the issuance of additional equity
securities.
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of
the small business issuer as provided in the foregoing provisions, or otherwise, the small business issuer has been advised that in the
opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities,
other than the payment by the small business issuer of expenses
incurred or paid by a director, officer or controlling person of the
small business issuer 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 small business
issuer 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.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
There have not been any changes in or disagreements with accountants on
accounting and financial disclosure or any other matter.
32
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
Market Information
Item 5(a)
a) Market Information. Our common stock is not quoted on a market or
securities exchange. We cannot provide any assurance that an active
market in our common stock will develop. We intend to quote our common
shares on a market or securities exchange.
b) Holders. At September 30, 2010, there were four (4) shareholders
of the registrant.
c) Dividends. Holders of the registrant's common stock are entitled
to receive such dividends as may be declared by its board of directors.
No dividends on registrant's common stock have ever been paid, and the
registrant does not anticipate that dividends will be paid on its
common stock in the foreseeable future.
d) Securities authorized for issuance under equity compensation plans.
No securities are authorized for issuance by the registrant under
equity compensation plans.
Plan Category Number of Securities Weighted Average Exercise Number of Securities
Issued upon Exercise of Price of Outstanding Options Remaining Available
Outstanding Options, Warrants and Rights Future Issuance
Equity
Compensation
Plans Approved
by Security Holders n/a n/a n/a
Equity
Compensation
Plans Not Approved
by Security Holders n/a n/a n/a
---------- ------ ------
Total n/a n/a
e) Performance graph
Not applicable.
f) Sale of unregistered securities.
On June 21, 2009, we issued 3,000,000 shares of our common stock to Ms.
Lecia L. Walker, president and a director of the registrant. These
shares were issued in exchange for the license and assignment of
certain assets under a License and Assignment Agreement dated August
21, 2009.
On June 21, 2009, we issued 500,000 shares of our common stock to Ms.
E. Lynn Atwood, an officer and director of the registrant. These
shares were issued in exchange for cash of $500.00.
On August 21, 2009, we issued 500,000 shares of our common stock to Ms.
Linda Rock, a non-affiliate. These shares were issued in exchange for
cash of $500.00.
On June 1, 2010, we issued 500,000 shares of our common stock to Ms.
Sheri Sabey, a non-affiliate. These shares were issued in exchange for
cash of $500.00.
33
All of the above securities were issued pursuant to an exemption from
registration under Section 4(2) of the Securities Act of 1933 to
sophisticated investors.
Item 5(b) Use of Proceeds. As described herein
Item 5(c) Purchases of Equity Securities by the issuer and
affiliated purchasers. None.
Admission to Quotation on the OTC Bulletin Board and/or OTCQB
We intend to have a market maker file an application for our common
stock to be quoted on the OTC Bulletin Board and/or the OTCQB.
However, we do not have a market maker that has agreed to file such
application. If our securities are not quoted on the OTC Bulletin
Board or the OTCQB, a security holder may find it more difficult to
dispose of, or to obtain accurate quotations as to the market value of
our securities. The OTC Bulletin Board and the OTCQB differs from
national and regional stock exchanges in that it:
(1) is not situated in a single location but operates through
communication of bids, offers and confirmations between broker-dealers,
and
(2) securities admitted to quotation are offered by one or more broker-
dealers rather than the "specialist" common to stock exchanges.
To qualify for quotation on the OTC Bulletin Board and/or the OTCQB, an
equity security must have one registered broker-dealer, known as the
market maker, willing to list bid or sale quotations and to sponsor the
registrant listing. If it meets the qualifications for trading
securities on the OTC Bulletin Board and the OTCQB, our securities will
trade on the OTC Bulletin Board and the OTCQB. We may not now or ever
qualify for quotation on the OTC Bulletin Board or the OTCQB. We
currently have no market maker who is willing to list quotations for
our securities.
EXPERTS
The financial statements of the registrant appearing in this prospectus
and in the registration statement have been audited by Ronald Chadwick,
P.C., an independent registered public accounting firm and are included
in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
LEGAL PROCEEDINGS
We are not a party to any legal proceedings the outcome of which, in
the opinion of our management, would have a material adverse effect on
our business, financial condition, or results of operation.
LEGAL MATTERS
The validity of the common shares being offered hereby will be passed
upon by Jody M. Walker, Attorney At Law, Centennial, Colorado.
34
WHERE YOU CAN FIND MORE INFORMATION
At your request, we will provide you, without charge, a copy of any
document filed as exhibits in this prospectus. If you want more
information, write or call us at:
Original Source Entertainment, Inc.
8201 South Santa Fe Drive, Suite 229
Littleton, CO 80120
Telephone (303) 495-3728
Attention: Lecia L. Walker, Chief Executive Officer
Our fiscal year ends on December 31st. Upon completion of this
offering, we will become a reporting company and file annual, quarterly
and current reports with the SEC. You may read and copy any reports,
statements, or other information we file at the SEC's public reference
room at 100 F Street, Washington D.C. 20549. You can request copies of
these documents, upon payment of a duplicating fee by writing to the
SEC. Please call the SEC at 1-800- SEC-0330 for further information on
the operation of the public reference rooms. Our SEC filings are also
available to the public on the SEC Internet site at http:\\www.sec.gov.
35
ORIGINAL SOURCE ENTERTAINMENT, INC.
(A Development Stage Company)
Consolidated Financial Statements
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM 36
CONSOLIDATED FINANCIAL STATEMENTS
Consolidated balance sheets at December 31, 2009
and June 30, 2010 37
Consolidated statements of operations for the period
from inception through December 31, 2009, for
the six months ended June 30, 2010 and from inception
through June 30, 2010 38
Consolidated statements of stockholders' equity 39
Consolidated statements of cash flows for the period
from inception through December 31, 2009, for
the six months ended June 30, 2010 and from inception
through June 30, 2010 40
Notes to consolidated financial statements 41
36
RONALD R. CHADWICK, P.C.
Certified Public Accountant
2851 South Parker Road, Suite 720
Aurora, Colorado 80014
Telephone (303)306-1967
Fax (303)306-1944
Board of Directors
Original Source Entertainment, Inc.
Littleton, Colorado
I have audited the accompanying consolidated balance sheet of Original
Source Entertainment, Inc. (a development stage company) as of December
31, 2009, and the related consolidated statements of operations,
stockholders' equity, and cash flows for the period from August 20,
2009 (inception) through December 31, 2009. These financial statements
are the responsibility of the registrant's management. My
responsibility is to express an opinion on these financial statements
based on my audit.
I conducted my audit in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards
require that I plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are free
of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
consolidated financial statements. An audit also includes assessing
the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. I believe that my audit provides a reasonable basis for
my opinion.
In my opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial
position of Original Source Entertainment, Inc. at December 31, 2009,
and the consolidated results of its operations and its cash flows for
the period from August 20, 2009 (inception) through December 31, 2009
in conformity with accounting principles generally accepted in the
United States of America.
The accompanying consolidated financial statements have been prepared
assuming that the registrant will continue as a going concern. As
discussed in Note 1 to the financial statements, the registrant has
suffered a loss from operations and has limited working capital. These
conditions raise substantial doubt about its ability to continue as a
going concern. Management's plans in regard to these matters are also
described in Note 1. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.
/s/Ronald R. Chadwick, P.C.
- ---------------------------
Ronald R. Chadwick, P.C.
Aurora, Colorado
August 16, 2010
37
ORIGINAL SOURCE ENTERTAINMENT, INC.
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
June 30,
Dec. 31, 2010
2009 (Unaudited)
----------- -----------
ASSETS
Current Assets
Cash $ 1,221 $ 4,922
----------- -----------
Total current assets 1,221 4,922
----------- -----------
Total Assets $ 1,221 $ 4,922
=========== ===========
LIABILITIES & STOCKHOLDER'S EQUITY
Current liabilities
Notes payable - current $ - $ 1,500
---------- -----------
Total current liabilities - 1,500
---------- -----------
Notes payable - 2,000
---------- -----------
Total liabilities - 3,500
---------- -----------
Stockholder's Equity
Preferred stock, $.001 par value;
5,000,000 shares authorized;
none issued and outstanding - -
Common stock, $.001 par value;
45,000,000 shares authorized;
4,000,000 (2009) and 4,500,000
(2010) shares issued and
outstanding 4,000 4,500
Additional paid in capital - -
Deficit accumulated during the dev.
Stage (2,779) (3,078)
---------- -----------
Total Stockholder's Equity 1,221 1,422
---------- -----------
Total Liabilities and Stockholder's
Equity $ 1,221 $ 4,922
========== ===========
The accompanying notes are an integral part
of the consolidated financial statements.
38
ORIGINAL SOURCE ENTERTAINMENT, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
Aug. 20, 2009
Aug. 20, 2009 Six Months (Inception)
(Inception) Ended Through
Through June 30, 2010 June 30, 2010
Dec. 31, 2009 (Unaudited) (Unaudited)
------------- ------------- ------------
Royalty revenue $ 398 $ 894 $ 1,292
------------- ------------- ------------
Operating expenses:
General and administrative 3,177 1,193 4,370
------------- ------------- ------------
3,177 1,193 4,370
------------- ------------- ------------
Gain (loss) from operations (2,779) (299) (3,078)
------------- ------------- ------------
Other income (expense): - - -
------------- ------------- ------------
Income (loss) before provision
for income taxes (2,779) (299) (3,078)
------------- ------------- ------------
Provision for income tax - - -
------------- ------------- ------------
Net income (loss) $ (2,779) $ (299) $ (3,078)
============= ============= ============
Net income (loss) per share
(Basic and fully diluted) $ (0.00) $ (0.00)
============= =============
Weighted average number of
common shares outstanding 4,000,000 4,083,333
============= =============
The accompanying notes are an integral part of the consolidated
financial statements.
39
ORIGINAL SOURCE ENTERTAINMENT, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Deficit
Accum.
Common Stock Preferred Stock During the Stock-
Amount Amount Paid In Development holders'
Shares($.001 Par) Shares($.001 Par) Capital Stage Equity
------- ------- ------- -------- ------- ----------- -------
Balances at August
20, 2009 - $ - - $ - $ - $ - $ -
Common stock issued
to founders for
services 3,000,000 3,000 - - - - 3,000
Common stock issued
for cash 1,000,000 1,000 - - - - 1,000
Net income (loss)
for the period - - - - (2,779) (2,779)
--------- ------- ------- -------- ------- --------- ---------
Balances at December
31, 2009 4,000,000 $ 4,000 - $ - $ - $ (2,779) $ 1,221
Common stock issued
for cash 500,000 500 - - - - 500
Net income (loss)
for the period - - - - - (299) (299)
--------- ------- ------- -------- ------- --------- ---------
Balances at June
30, 2010 -
unaudited 4,500,000 $ 4,500 - $ - $ - $ (3,078) $ 1,422
========= ======= ======= ======== ======= ========= =========
The accompanying notes are an integral part
of the consolidated financial statements
40
ORIGINAL SOURCE ENTERTAINMENT, INC.
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
Aug. 20, 2009
Aug. 20, 2009 Six Months (Inception)
(Inception) Ended Through
Through June 30, 2010 June 30, 2010
Dec. 31, 2009 (Unaudited) Unaudited)
------------- ------------- -------------
Cash Flows From Operating Activities:
Net income (loss) during the
development stage $ (2,779) $ (299) $ (3,078)
Adjustments to reconcile net loss to
net cash provided by (used for)
operating activities:
Compensatory stock issuances 3,000 - 3,000
---------- ---------- ----------
Net cash provided by (used for)
operating activities 221 (299) (78)
---------- ---------- ----------
Cash Flows From Investing Activities - - -
---------- ---------- ----------
Net cash provided by (used for)
investing activities - - -
---------- ---------- ----------
Cash Flows From Financing Activities:
Notes payable - borrowings - 3,500 3,500
Sale of common stock 1,000 500 1,500
---------- ---------- ----------
Net case provided by (used for)
financing activities 1,000 4,000 5,000
---------- ---------- ----------
Net Increase (Decrease) In Cash 1,221 3,701 4,922
Cash At The Beginning Of The Period - 1,221 -
---------- ---------- ----------
Cash At The End Of The Period $ 1,221 $ 4,922 $ 4,922
========== ========== ==========
Schedule Of Non-Cash Investing And Financing Activities
None
Supplemental Disclosure
Cash paid for interest $ - $ - $ -
Cash paid for income taxes $ - $ - $ -
The accompanying notes are an integral part
of the consolidated financial statements
41
Original Source Entertainment, Inc.
(A Developmental Stage Company)
Notes to Consolidated Financial Statements
December 31, 2009 and June 30, 2010 (Unaudited)
Note 1 - Organization and Summary of Significant Accounting Policies
Organization
Original Source Entertainment, Inc. (the "Company") was incorporated on
August 20, 2009 in the State of Nevada. The registrant has had limited
activity and revenue and is in the development stage, and its intent is
to license songs to the television and music industry for use in
television shows or movies.
The registrant has chosen December 31 as a year end.
Basis of Presentation
The accompanying financial statements have been prepared in conformity
with accounting principles generally accepted in the United States of
America, which contemplate continuation of the registrant as a going
concern. The Company has suffered losses and has limited working
capital. These conditions raise substantial doubt as to the
registrant's ability to continue as a going concern. The registrant
may raise additional capital through the sale of its equity securities,
through borrowing from individuals, or through borrowings from
financial institutions. By doing so, the registrant hopes through
increased marketing efforts to generate greater royalty revenues from
licensed songs. Management believes that actions presently being taken
to obtain additional funding provide the opportunity for the registrant
to continue as a going concern.
Principles of consolidation
The accompanying consolidated financial statements include the accounts
of Original Source Entertainment, Inc. and its wholly owned subsidiary.
All intercompany accounts and transactions have been eliminated in
consolidation.
Use of estimates
The preparation of financial statements in conformity with U.S.
generally accepted accounting principles (GAAP) requires management to
make estimates and assumptions that affect the amounts reported in the
financial statements. The registrant bases its estimates on historical
experience, management expectations for future performance, and other
assumptions as appropriate. Key areas affected by estimates include the
assessment of the recoverability of long-lived assets, which is based
on such factors as estimated future cash flows. The registrant re-
evaluates its estimates on an ongoing basis. Actual results may vary
from those estimates.
Cash and cash equivalents
All cash and short-term investments with original maturities of three
months or less are considered cash and cash equivalents, since they are
readily convertible to cash. These short-term investments are stated at
cost, which approximates fair value.
Property and equipment
The registrant has no property or equipment at this time.
42
Original Source Entertainment, Inc.
(A Developmental Stage Company)
Notes to Consolidated Financial Statements - (Continued)
December 31, 2009 and June 30, 2010 (Unaudited)
Revenue Recognition
The registrant utilizes the accrual method of accounting. For revenue
from product sales, the registrant recognizes revenue in accordance
with Staff Accounting Bulletin No. 104, "Revenue Recognition" (SAB No.
104), which superseded Staff Accounting Bulletin No. 101, "Revenue
Recognition in Financial Statements" (SAB No. 101). SAB No. 104
requires that four basic criteria must be met before revenue can be
recognized: (1) persuasive evidence of an arrangement exists; (2)
delivery has occurred; (3) the selling price is fixed and determinable;
and (4) collectability is reasonably assured. Determination of
criteria (3) and (4) are based on management's judgment regarding the
fixed nature of the selling prices of the products delivered and the
collectability of those amounts. Provisions for discounts and rebates
to customers, estimated returns and allowance, and other adjustments
will be provided for in the same period the related sales are recorded.
Customers' prepayments are deferred until products are shipped and
accepted by the customers.
Advertising expenses
Advertising costs are expensed when incurred. No advertising was
conducted during the period ended December 31, 2009 or the six months
ended June 30, 2010.
Income taxes
Income taxes are accounted for in accordance with ASC 740, using the
asset and liability method. Deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases and tax credit
carryforwards. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or
settled. The effect on deferred tax assets and liabilities of a change
in tax rates is recognized in income in the period that includes the
enactment date. The registrant is currently filing its income tax
returns on the cash basis.
Earnings (loss) per share
The net income (loss) per share is computed by dividing the net income
(loss) by the weighted average number of shares of common outstanding.
Warrants, stock options, and common stock issuable upon the conversion
of the registrant's preferred stock (if any), are not included in the
computation if the effect would be anti-dilutive and would increase the
earnings or decrease loss per share.
Financial Instruments
The carrying value of the registrant's financial instruments as
reported in the accompanying balance sheets approximates fair value.
Products and services, geographic areas and major customers
The registrant derives revenue from the licensing of songs to the
television and music industry. It currently has no separate operating
segments. The registrant's sales are external and domestic.
43
Original Source Entertainment, Inc.
(A Developmental Stage Company)
Notes to Consolidated Financial Statements - (Continued)
December 31, 2009 and June 30, 2010 (Unaudited)
Stock based compensation
The registrant accounts for employee and non-employee stock awards
under ASC 718, whereby equity instruments issued to employees for
services are recorded based on the fair value of the instrument issued
and those issued to non-employees are recorded based on the fair value
of the consideration received or the fair value of the equity
instrument, whichever is more reliably measurable.
Note 2 - Notes payable
At June 30, 2010 the registrant has two notes payable totaling $3,500.
One note for $1,500 is due to a related party shareholder, is
unsecured, bears no interest until June 1, 2011 and 6% compounded
monthly thereafter, with principal and interest due in full at June 1,
2012.
The other note for $2,000 is unsecured, bears no interest until
December 31, 2010 and 6% compounded monthly thereafter, with principal
and interest due in full at June 28, 2011. The principal balance on the
note is convertible anytime at the holder's discretion into common
shares of the registrant at 50% of the lowest bid price of the
registrant's common stock if quoted on an exchange, or if noted quoted,
at double the par value.
The future principal repayment schedule by year for all notes combined
is:
2011 $2,000,
2012 $1,500
Note 3 - Income Taxes
Deferred income taxes arise from the temporary differences between
financial statement and income tax recognition of net operating losses.
These loss carryovers are limited under the Internal Revenue Code
should a significant change in ownership occur.
At December 31, 2009 the registrant had a net operating loss
carryforward of approximately $2,800 which will expire in 2029. The
deferred tax asset of $556 created by the net operating losses has been
offset by a 100% valuation allowance. The change in the valuation
allowance in 2009 was $556.
Note 4 - Stockholders' Equity
Common Stock
The registrant as of December 31, 2009 and June 30, 2010 had 45,000,000
shares of authorized common stock, $.001 par value, with 4,000,000 and
4,500,000 shares issued and outstanding.
Preferred Stock
The registrant as of December 31, 2009 and June 30, 2010 had 5,000,000
shares of authorized preferred stock, $.001 par value, none issued and
outstanding, with rights, preferences and designations to be determined
by the Board of Directors.
44
Original Source Entertainment, Inc.
(A Developmental Stage Company)
Notes to Consolidated Financial Statements - (Continued)
December 31, 2009 and June 30, 2010 (Unaudited)
Note 5 - Subsequent Events
The registrant evaluated events subsequent to the balance sheet date of
June 30, 2010 through the date that these financial statements were
available for issuance and has determined that there are no subsequent
events that require disclosure.
45
Up to a Maximum of 10,000,000 Common Shares
at $.05 per Common Share
Prospectus
Original Source Entertainment, Inc.
October 4, 2010
YOU SHOULD ONLY RELY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS.
WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT
FROM THAT CONTAINED IN THIS PROSPECTUS. WE ARE OFFERING TO SELL, AND
SEEKING OFFERS TO BUY, COMMON SHARES ONLY IN JURISDICTIONS WHERE OFFERS
AND SALES ARE PERMITTED.
Until ________ 2010, all dealers that effect transactions in these
securities, whether or not participating in this offering, may be
required to deliver a prospectus. This is in addition to the dealers'
obligation to deliver a prospectus when acting as underwriters and with
respect to their unsold allotments or subscriptions.
46
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
- -----------------------------------------------------
The following table sets forth the estimated expenses to be incurred in
connection with the distribution of the securities being registered.
The registrant shall pay the expenses.
SEC Registration Fee . . . . . . $ 41.00
Printing and Engraving Expenses 1,500.00
Legal Fees and Expenses . . . . 10,000.00
Accounting Fees and Expenses. . 4,000.00
Miscellaneous . . . . . . . . . 4,459.00
----------
TOTAL . . . . . . . . . . . . . $20,000.00
==========
Item 14. Indemnification of Directors and Officers
- ---------------------------------------------------
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of
the registrant as provided in the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable.
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 small business
issuer 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.
otherwise.
Item 15. Recent Sales of Unregistered Securities.
The following sets forth information regarding all unregistered securities sold by the registrant in the three years preceding the date of this registration statement.
In connection with the 2020 Paulson Private Placement, between April 30, 2020 and June 30, 2020, the Company entered into subscription agreements with accredited investors, pursuant to which the Company, in a private placement, agreed to issue and sell to the 2020 Paulson Subscribers 2020 Paulson Notes and 2020 Paulson Warrants. As of the final closing of the 2020 Paulson Private Placement, the Company issued 2020 Paulson Notes in an aggregate principal amount of $5,122,700, and 2020 Paulson Warrants exercisable for 1,369,690 shares of Common Stock. In connection with the 2020 Paulson Private Placement, Paulson received a cash commission equal to 12% of the gross proceeds from the sale of the 2020 Paulson Notes and 7-year warrants to purchase an amount of Common Stock equal to 410,911, with an exercise price equal to $1.87.
II-2
In addition, between May 4, 2020 and July 21, 2020, certain 2020 Paulson Subscribers elected to convert $3,590,840 of the outstanding principal and interest of the 2020 Paulson Notes into 4,012,334 shares of Common Stock, and on July 23, 2020, the remaining $1,613,961 of the outstanding principal and interest of the 2020 Paulson Notes were automatically converted into 1,605,532 shares of Common Stock following the announcement of a Strategic Transaction.
In connection with the 2019 Paulson Private Placement, between November 1, 2019 and December 3, 2019, the Company entered into subscription agreements with accredited investors, pursuant to which the Company, in a private placement, agreed to issue and sell to the 2019 Paulson Subscribers 2019 Paulson Notes and 2019 Paulson Warrants to purchase shares of Common Stock. As of the final closing of the 2019 Paulson Private Placement, the Company issued 2019 Paulson Notes in an aggregate principal amount of $3,234,800 and 2019 Paulson Warrants exercisable for 864,913 shares of Common Stock. In connection with the 2019 Paulson Private Placement, Paulson received a cash commission equal to 12% of the gross proceeds from the sale of the 2019 Paulson Notes, and 10-year warrants to purchase 259,476 shares of Common Stock at an exercise price of $1.87 per share.
In addition, between April 24, 2020 and June 25, 2020, certain 2019 Paulson Subscribers elected to convert $2,687,017.58 of the outstanding principal and interest of the 2019 Paulson Notes into 2,115,272 shares of Common Stock, and an additional 60,847 shares were issued to a 2019 Paulson Subscriber.
On October 23, 2019 and July 28, 2020, the Company entered into Securities - -------------------------------------------------
Purchase Agreements with certain accredited investors in separate private placements, pursuant to which the Company agreed to issue and sell 141,666 shares and 75,000 shares, respectively.
In connection with a private placement, between December 28, 2018 and July 1, 2019, the Company entered into subscription agreements with accredited investors, pursuant to which the Company agreed to issue and sell to the purchasers units for $2.50 per unit (the “2019 Private Placement”). Each unit consisted of (i) one share of Common Stock and (ii) a warrant to purchase one share of Common Stock at an initial exercise price of $3.00 per share. The warrants are exercisable beginning on the date of issuance and expire on December 28, 2023. The Company has issued an aggregate of 2,338,179 units, for total gross proceeds to the Company of approximately $5,845,448 in connection with all closings of the 2019 Private Placement. In connection with the 2019 Private Placement, Paulson received a cash commission equal to 12% of the gross proceeds from the sale of the units to the Paulson Investors, and HRA Capital received a cash commission equal to 8% of the gross proceeds from the sale of the units to certain investors (the “HRA Investors”).
In addition, pursuant to placement agent agreements, on July 1, 2019, the Company issued 5-year warrants to Paulson and its designees to purchase 193,417 shares of Common Stock at an exercise price of $2.75 per share, and the Company issued to Corinthian Partners, LLC and its designees 5-year warrants to purchase 17,760 shares of Common Stock at an exercise price of $3.00 per share and 5-year warrants to purchase 135,512 shares of Common Stock at an exercise price of $2.00 per share.
In connection with a private placement, between July 9, 2018 and November 30, 2018, the Company entered into subscription agreements with accredited investors, pursuant to which the Company agreed to issue and sell to the purchasers units for $2.50 per unit (the “2018 Private Placement”). Each unit consisted of (i) one share of Common Stock and (ii) a warrant to purchase one share of Common Stock at an initial exercise price of $3.00 per share. The Company issued an aggregate of 615,200 units, for total gross proceeds to the Company of approximately $1,538,000 in connection with all closings of the 2018 Private Placement.
On JuneOctober 1, 2019, in consideration for consulting services, the Company agreed to issue to a consultant 100,000 shares of Common Stock on the following schedule: 50,000 shares of Common Stock in connection with the execution of the consulting agreement, 25,000 shares of Common Stock on January 1, 2020 and 25,000 shares of Common Stock on April 1, 2020. On April 22, 2020, the Company entered into an amendment to the Consulting Agreement, pursuant to which the Company issued the consultant an additional 35,000 shares in exchange for consulting services.
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On October 28, 2019, in consideration for consulting services, the Company agreed to issue to a consultant 15,000 shares of Common Stock on the following schedule: 5,000 shares of Common Stock in connection with the execution of the consulting agreement, 5,000 shares of Common Stock before December 28, 2019 and 5,000 shares of Common Stock before January 28, 2020.
On February 6, 2018, pursuant to a services agreement with JLS Ventures, LLC, the Company agreed to issue to JLS an aggregate of 250,000 shares of Common Stock for investor relations services. The Company issued to JLS 100,000 shares of Common Stock on April 26, 2018, 50,000 shares of Common Stock on May 7, 2018, 50,000 shares of Common Stock on August 29, 2018, and 50,000 shares of Common Stock on November 2, 2018.
On August 18, 2017, the Company entered into subscription agreements with the subscribers (the “Series 2 Subscribers”) identified therein (the “Series 2 Subscription Agreements”). Pursuant to the terms of the Series 2 Subscription Agreements, the Company issued to the Series 2 Subscribers the Series 2 Notes (the “Series 2 Notes”) and warrants. In addition, in March 2018, the Company issued to the Series 2 Subscribers additional warrants to purchase shares of the Company’s capital stock. The total amount of Series 2 Notes sold pursuant to the Series 2 Subscription Agreements was $253,000.
Effective as of July 2, 2018, the Company entered into the Series 1 Notes Debt Conversion Agreement with each subscriber to the Series 1 subscription agreements (the “Series 1 Subscribers”, and together with the Series 2 Subscribers, the “Subscribers”) and the Series 2 Notes Debt Conversion Agreement with each Series 2 Subscriber (the “Conversion Agreements”) to (i) convert the outstanding principal and accrued and unpaid interest (the “Outstanding Balance”) under the Series 1 notes (the “Series 1 Notes”) and the Series 2 Notes (together, the “Series Notes”) into shares of the Company’s Common Stock based on the Outstanding Balance divided by $1.80 per share (the “Conversion Shares”); (ii) cancel and extinguish the Series Notes; and (iii) amend and restate all of the warrants to make them immediately exercisable upon conversion, at a per share exercise price equal to $1.80 per share. As consideration for the early conversion of the Series Notes, the Company issued each Subscriber a new warrant, exercisable for up to the number of shares of Common Stock equal to the number of Conversion Shares received by such Subscriber; at a per share exercise price of $1.80 per share. The new warrants are exercisable commencing on July 2, 2018, and expire on November 21, 2009, we2021.
Pursuant to the Conversion Agreements, $1,804,064 of the outstanding principal and interest of the Series 1 Notes was converted into 1,002,258 shares of Common Stock and $259,297 of the outstanding principal and interest of the Series 2 Notes was converted into 144,053 shares of Common Stock. Additionally, as of July 2, 2018, 2,482,372 shares of Common Stock were issuable upon exercise of the warrants.
Between October 2017 and May 2018, the Company issued 3,000,000the Series 3 Notes in an aggregate principal amount of $1.5 million that bear interest at a fixed rate of 8% per annum and warrants to purchase shares of the Company’s capital stock. On February 28, 2019, the Company completed an equity round of financing resulting in more than $3 million in gross proceeds when it closed on the sale of units in connection with the 2019 Private Placement. Following such financing, the outstanding principal and interest of the Series 3 Notes of $1,678,361 was automatically converted in accordance with the terms of the Series 3 Notes into 839,179 shares of Common Stock and 839,179 warrants at an exercise price equal to $3.00 per share. Additionally, the previously issued warrants became immediately exercisable for 839,179 shares of Common Stock, at an exercise price equal to $2.50 per share, and will expire on February 28, 2024. The exercise price and number of the shares of our common stock to Ms.
Lecia L. Walker, an officer and directorCommon Stock issuable upon exercise of the registrant. These
shares were issuedwarrants will be subject to adjustment in exchange for the licenseevent of any stock dividends and assignment of
certain assets under a License and Assignment Agreement dated August
21, 2009.
On June 21, 2009, we issued 500,000 shares of our commonsplits, reverse stock to Ms.
E. Lynn Atwood, an officer and director ofsplit, recapitalization, reorganization, business combination or similar transaction.
In connection with the registrant. These
shares were issued in exchange for cash of $500.00.
On August 21, 2009, we issued 500,000 shares of our common stock to Ms.
Linda Rock, a non-affiliate. These shares were issued in exchange for
cash of $500.00.
On June 1, 2010, we issued 500,000 shares of our common stock to Ms.
Sheri Sabey, a non-affiliate. These shares were issued in exchange for
cash of $500.00.
47
All offoregoing, the above securities were issued pursuant to anCompany relied upon the exemption from registration underprovided by Section 4(2) of4(a)(2) under the Securities Act of 1933 to
sophisticated investors.
or Regulation D promulgated under the Securities Act for transactions not involving a public offering.
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Item 16. Exhibits and Financial Statement Schedules
- ---------------------------------------------------
The following exhibits are filed as part of this registration
statement:
Exhibit Description
- ------- -----------
3 Articles of Incorporation, By-Laws
(i) Articles of Incorporation and amendment.
(ii) By-Laws.
5 Consent and Opinion of Jody M. Walker, Attorney at Law,
regarding the legality of the securities being registered
10 License and Assignment Agreement dated August 21, 2009
11 Statement of Computation of Per Share Earnings
This Computation appears in the Financial Statements.
23 Consent of Certified Public Accountant.
Schedules.
EXHIBIT INDEX
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* | Pursuant to Item 601(b)(2) of Regulation S-K, the Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the Agreement and Plan of Merger to the Securities and Exchange Commission upon request. |
# | Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the SEC upon request. Certain portions of the exhibits that are not material and would be competitively harmful if publicly disclosed have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. Copies of the unredacted exhibits will be furnished to the SEC upon request. |
## | Portions of this exhibit have been omitted pursuant to a request for confidential treatment and have been separately filed with the Securities and Exchange Commission. |
+ | Indicates management contract or compensatory plan. |
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Item 17. Undertakings
- ----------------------
(a) Undertakings.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
i. To include any prospectus required by Section 10(a)(3) of
the Securities Act;
ii. Reflect in the prospectus any facts or events arising after
the effective date of 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 exceedundertakes that, which was registered and any deviation from the
low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the SEC in accordance
with Rule 424(b) of this chapter, if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement; and
iii. Include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial BONA FIDEbona fide offering thereof.
(3) To
The undersigned registrant hereby undertakes to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.48
(4) That,
The undersigned registrant hereby undertakes that, for the purposepurposes of determining liability under the
Securities Act of 1933 to any purchaser in the initial distribution of
the securities: The undersigned registrant undertakes that in a
primary offering of securities of the undersigned registrant pursuant
to this registration statement, regardless of the underwriting method
used to sell the securities to the purchase, if the securities are
offered or sold to such purchaser by means of any of the following
communications, the undersigned registrant will be a seller to the
purchase and will be considered to offer or sell such securities to
such purchaser:
i. Any preliminary prospectus or prospectus of the
undersigned small business issuer relating to the offering required to
be filed pursuant to Rule 424;
ii. Any free writing prospectus relating to the offering
prepared by or on behalf of the undersigned registrant or used or
referred to by the undersigned registrant;
iii. The portion of any other free writing prospectus
relating to the offering containing material information about the
undersigned registrant or its securities provided by or on behalf of
the undersigned registrant; and
iv. Any other communication that is an offer in the offering
made by the undersigned registrant to the purchaser.
(5) That, for the purpose of determining liability under the
Securities Act of 1933 to any purchaser:
i. If the registrant is relying on Rule 430B (230.430B of this
chapter):
A. Each prospectus filed by the registrant pursuant to Rule
424(b)(3) shall be deemed to be part of the registration
statement as of the date the filed prospectus was deemed part of
and included in the registration statement; and
B. Each prospectus required to be filed pursuant to Rule
424(b)(2), (b)(5), or (b)(7) as part of the registration
statement in reliance on Rule 430B relating to an offering made
pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of
providing the information required by section 10(a) of the
Securities Act of 1933 shall be deemed to be part of and included
in the registration statement as of the earlier date such form of
prospectus is first used after effectiveness or the date of the
first contract of sale of securities in the offering described in
the prospectus. As provided in Rule 430B, for liability purposes
of the issuer and any person that is at that date an underwriter,
such date shall be deemed to be a new effective date of the
registration statement relating to the securities in the
registration statement to which that prospectus relates, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof. Provided, however, that
no statement made in a registration statement or prospectus that
is part of the registration statement or made in a document
incorporated or deemed incorporated by reference into the
registration statement or prospectus that is part of the
registration statement will, as to a purchaser with a time of
contract of sale prior to such effective date, supersede or
modify any statement that was made in the registration statement
or prospectus that was part of the registration statement or made
in any such document immediately prior to such effective date; or
49
ii.
If the registrant is subject to Rule 430C (§230.430C of this chapter), each prospectus filed pursuant to Rule 424(b) as part of thea registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
SIGNATURES
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In accordancethe 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.
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Pursuant to the requirements of the Securities Act of 1933, Original Source Entertainment, Inc. certifies that itthe registrant has reasonable
grounds to believe that it meets all of the requirements of filing on
Form S-1 and authorizedduly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Littleton,Eden Prairie, State of ColoradoMinnesota, on August 11, 2020.
NeuroOne Medical Technologies Corporation | ||
By: | /s/ David Rosa | |
David Rosa | ||
Its: | Chief Executive Officer |
Each person whose signature appears below constitutes and appoints David Rosa his true and lawful attorney in fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments (including post effective amendments) to the 3rd dayregistration statement, and to sign any registration statement for the same offering covered by this registration statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of October, 2010.
Original Source Entertainment, Inc.
By: /s/ Lecia L. Walker
-------------------
Lecia L. Walker, President
In accordance1933, as amended, and all post effective amendments thereto, and to file the same, with all exhibits thereto, and all documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, each acting alone, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this registration statement washas been signed by the following persons in the capacities and on the dates stated.
By: /s/Lecia L. Walker Dated: October 4, 2010
----------------------
Lecia L. Walker, CEO, CFO
Controller, Director
By: /s/E. Lynn Atwood Dated: October 4, 2010
----------------------
E. Lynn Atwood, Director
indicated.
Date: August 11, 2020 | /s/ David Rosa |
David Rosa | |
Chief Executive Officer and Director | |
(Principal Executive Officer, | |
Principal Financial Officer and | |
Principal Accounting Officer) | |
Date: August 11, 2020 | /s/ Paul Buckman |
Paul Buckman | |
Director | |
Date: August 11, 2020 | /s/ Jeffrey Mathiesen |
Jeffrey Mathiesen | |
Director | |
Date: August 11, 2020 | /s/ Edward Andrle |
Edward Andrle | |
Director |
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