AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 15, 2001
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
DISEASE SCIENCES, INC.
---------------------
(Exact name of registration as specified in its charter)
Delaware 13-264091
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
20283 State Road 7
Suite 400
Boca Raton, Florida 33498
(Address and Telephone Number of Principal Executive Offices)
2000 Management and Director Equity Incentive and Compensation Plan
------------------------------------------------------------------------
(Full Title of the Plan)
Copies to:
Dr. Wayne Goldstein Roxanne K. Beilly, Esq.
President Atlas Pearlman, P.A.
Disease Sciences, Inc. 350 East Las Olas Boulevard
20283 State Road 7, Suite 400 Suite 1700
Boca Raton, FL 33498 Fort Lauderdale, FL 33301
(561) 487-3655 (954) 763-1200
CALCULATION OF REGISTRATION FEE
------------------------------------------------------------------------------------------------------------
Proposed Proposed
maximum maximum
offering aggregate Amount of
Title of securities Amount to be price per offering registration
to be registered registered share price fee
------------------------------------------------------------------------------------------------------------
Common Stock, $.001
par value per share (1) 7,750,000 shares $.35 $2,712,500 $679
Common Stock, $.001
par value per share (1) 2,000,000 shares $.155 310,000 78
Common Stock, $.001
par value per share (1) 250,000 shares $.20 50,000 13
Totals 10,000,000 shares $3,072,500 $770
(1) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933 (the "Securities
Act") based upon the closing bid and asked prices for the common stock
as reported on the OTC Bulletin Board on August 10, 2001.
When used herein, the terms "Disease Sciences," "we," "us," and "our"
refers to Disease Sciences, Inc., formerly known as AuctionAnything.com, Inc.,
a Delaware corporation, and its subsidiary Disease S.I., Inc., a Florida
corporation.
PROSPECTUS
DISEASE SCIENCES, INC.
10,000,000 Shares of Common Stock
To Be Issued Pursuant to
2000 Management and Director Equity Incentive and Compensation Plan
This prospectus forms a part of a registration statement which
registers an aggregate of 10,000,000 shares of our common stock which may be
issued from time to time to certain of our officers, directors, employees and
consultants in the form of restricted stock awards or performance stock awards,
or upon the exercise of stock options granted to these individuals or entities,
under our 2000 Management and Director Equity Incentive and Compensation Plan.
These individuals or entities are sometimes collectively referred to as the
"selling shareholders." This prospectus also covers the resale of the shares of
our common stock issued pursuant to this prospectus by persons who are our
"affiliates" within the meaning of federal securities laws. The selling
shareholders may sell all or a portion of the shares of our common stock from
time to time in the over-the-counter market, in negotiated transactions,
directly or through brokers or otherwise, and at market prices prevailing at the
time of such sales or at negotiated prices. We will not receive any proceeds
from sales by selling shareholders.
No person has been authorized by us to give any information or to make
any representation other than as contained in this prospectus, and if given or
made, such information or representation must not be relied upon as having been
authorized by us. Neither the delivery of this prospectus nor any distribution
of the shares of common stock shall, under any circumstances, create any
implication that there has been no change in our affairs since the date hereof.
Investing in our shares involves certain risks. See the "Risk Factors"
section beginning on page 14.
These securities have not been approved or disapproved by the
Securities and Exchange Commission nor has the Commission passed on the accuracy
or adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
This prospectus does not constitute an offer to sell securities in any
state to any person to whom it is unlawful to make such offer in such state.
The date of this prospectus is August 15, 2001.
AVAILABLE INFORMATION
We have filed with the SEC a registration statement on Form S-8. This
prospectus is part of the registration statement. It does not contain all of the
information set forth in the registration statement. For further information
about Disease Sciences and our common stock, you should refer to the
registration statement. Statements contained in this prospectus as to the
contents of any contract or other document referred to in this prospectus are
not necessarily complete. Where a contract or other document is an exhibit to
the registration statement, each of you should review the provisions of the
exhibit to which reference is made. You may obtain these exhibits from the SEC
as discussed below.
We are required to file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
document we file at the SEC's public reference rooms in Washington, D.C., New
York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for
more information on the operation of the public reference rooms. Copies of our
SEC filings are also available to the public from the SEC's web site at
http://www.sec.gov.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information filed with the
SEC will update and supersede this information. We incorporate by reference the
documents listed below, any of such documents filed since the date this
registration statement was filed and any future filings with the SEC under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act") until the offering is completed.
- our annual report on Form 10-KSB for the fiscal year ended
January 31, 2001, as amended on Form 10-KSB/A filed on
August 16, 2001,
- our quarterly report on Form 10-QSB for the quarter ended
April 30, 2001,
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- our current reports on Form 8-K filed on June 6, 2001 and
June 7, 2001,
- our Definitive Information Statements filed on June 18, 2001,
June 26, 2001 and July 23, 2001,
- our current report on Form 8-K/A filed on June 29, 2001,
- our current report on Form 8-K filed on July 26, 2001, and
- all reports and documents filed by us pursuant to Section 13,
14 or 15(d) of the Exchange Act, prior to the filing of a
post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part hereof from
the respective date of filing of such documents.
Any statement incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this prospectus to the extent that a
statement contained herein or in any other subsequently filed document, which
also is or is deemed to be incorporated by reference herein, modifies or
supersedes such statement. Any statement modified or superseded shall not be
deemed, except as so modified or superseded, to constitute part of this
prospectus.
You may request a copy of these filings, at no cost, by writing or
calling us at the following address and telephone number:
Corporate Secretary
Disease Sciences, Inc.
20283 State Road 7
Suite 400
Boca Raton, Florida 33498
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OUR BUSINESS
This prospectus contains forward-looking statements that involve risks
and uncertainties. Our actual results may differ materially from the results
discussed in the forward-looking statements. You are urged to read this
prospectus carefully and in its entirety.
Our History
From 1999 until July 2001, we operated a variety of Internet-related
services. We were unable to generate positive cash flow from these
Internet-related businesses. On May 23, 2001, we executed an Agreement and Plan
of Reorganization and Stock Purchase Agreement (the "Disease SI Agreement") with
Disease S.I., Inc., a Florida corporation ("Disease SI") and its shareholders,
Dr. Wayne Goldstein and Mr. Brian S. John. Under the terms of the Disease SI
Agreement, we acquired 100% of the issued and outstanding stock of Disease SI in
exchange for 60,000,000 shares of our common stock. Disease SI is a
developmental stage biopharmaceutical/clinical diagnostics company.
Concurrent with the closing of the Disease SI Agreement, Dr. Goldstein
and Mr. John were appointed our officers and directors, and Messrs. Martin Meads
and John Hotaling, who had been our executive officers, resigned their positions
as officers, but remained as members of our board of directors and officers of
North Orlando Sports Promotions, Inc., which was our wholly-owned subsidiary.
Following completion of the acquisition of Disease SI, it became
apparent to us that it would be in our best long term interest that the Internet
operations be conducted apart from our biopharmaceutical/clinical diagnostics
operations. On July 24, 2001, we sold Mr. Hotaling North Orlando Sports
Promotions, Inc., in exchange for the assumption of all liabilities related to
North Orlando and its operations estimated at approximately $112,000, and which
included the forgiveness of $91,500 in accrued compensation. Included in the
sale along with the capital stock of North Orlando were fixed assets, rights to
several domain names and various contractual rights and obligations. On July 24,
2001, Messrs. Hotaling and Meads resigned as members of our Board of Directors.
We were incorporated in Delaware in February 1969. Following the
transaction with Disease SI, on July 16, 2001, we changed our name to Disease
Sciences, Inc.
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Plan of Operation
Our long-term goal is to become a partially integrated pharmaceutical
company with capabilities in research, drug development, clinical investigation,
and regulatory affairs. We are planning to employ a broad array of technologies
to detect, identify and quantify substances in blood or other bodily fluids and
tissues. We intend to target and develop proprietary pharmaceutical compounds
and new technologies. Our primary goal will be to develop a Transmissible
Spongiform Encephalopathy ("TSE") test, useful in the diagnosis of TSE diseases
such as scrapie in sheep, Bovine Spongiform Encephalopathy (BSE) in cattle
(commonly known as "mad-cow disease"), Chronic Wasting Disease (CWD) in wild
deer and elk and Creutzfeldt-Jakob Disease (CJD) in humans. We believe these
test results may be used in the diagnosis, detection, evaluation, monitoring and
potential treatment of diseases and other medical conditions.
Our overall plan of operation includes:
* identifying, acquiring and exploiting rights to new
technologies and compounds relating to BSE, CJD and other
neurological disorders;
* enhancing the value of those assets through further research
and clinical testing;
* performing clinical studies towards regulatory approval and
attempt to market our drugs through licensing agreements with
pharmaceutical companies; and
* working to develop other promising compounds in-house and in
collaboration with third parties.
In the implementation of our plan of operation, our principal
activities will include:
* researching and developing technologies for TSE screening;
* conducting clinical studies to validate our TSE screening
tests;
* negotiating licenses for intellectual property of others
incorporated into our technologies;
* developing relationships with leaders in the scientific and
medical communities;
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* conducting market studies and analyzing potential approaches
for commercializing technologies which may develop;
* hiring research and clinical personnel;
* hiring management and other support personnel; and
* raising capital.
Our goal is to eventually offer TSE screening services to establish the
market. We will then seek to license our technologies to leading clinical
reference laboratories to enable them to develop tests. We may also choose to
package our technologies and seek approval for diagnostic test kits with which
any clinical laboratory could conduct our tests.
Currently, we do not maintain any research or laboratory premises, but
plan to utilize such facilities on a contractual or collaborative basis at
academic and research institutions, as well as contract research organizations.
Considering the commercialization infrastructure necessary to effectively market
our target drug products, we will also seek to establish joint ventures or
collaborations with universities and pharmaceutical companies, both domestically
and outside the United States. We will also seek universities as well as
corporate partners, who will be responsible for at least part of the clinical
development, regulatory approval, manufacturing and marketing of the drug
product. Under such an arrangement, we expect to receive certain up-front and
sub-licensing fees, ongoing research contracts, milestone payments, and
royalties on drug product sales.
About Prions And Prion Diseases
Prions (pronounced "pree-ons") are infectious proteins that are the
causative agents of spongiform encephalopathies. Prions consist of a single
molecule containing about 250 amino acids termed the PrP protein. Prions are
unique in that they break many rules of biology. Most life forms such as
viruses, bacteria, plants and humans pass down their blueprints for all their
progeny via their deoxyribonucleic acid (DNA). Generally, in nature the process
for converting the blueprints into building blocks must involve replication of
DNA, transcription of the message into ribonucleic acid (RNA) and translation of
the RNA's message to form proteins, the building blocks of cells, tissues,
7
organs and whole organisms. Prions differ in that they contain no DNA or RNA.
With prions, we have life forms where abnormal proteins direct the refolding of
normal proteins just by direct contact. The difference between the normal and
abnormal proteins does not lie in their primary structure (the sequence of their
amino acids), but rather in their folding. Prion infected proteins are folded
into abnormal shapes in a way that allows them to resist normal protease
degradation which over time leads to the build up of aggregates of the abnormal
protein, especially in neurons in the brain.
Prions are also unique in that are not destroyed by the usual means to
kill infectious agents. They are resistant to boiling at temperatures as high as
250 degrees Celsius (over 400 degrees Fahrenheit). They are also resistant to
ionizing radiation. Additionally, prion related diseases are also extremely
difficult to diagnose. Currently, there is no blood test for TSE, and infected
animals do not mount any immune response to the infection and signs of diseases
like BSE, are often only possible to diagnose at autopsy.
Prion diseases are progressive degenerative disorders of the central
nervous system. In cattle, the latency (incubation period) for mad cow disease
is roughly five years, meaning that cows have the disease for five years before
symptoms begin to appear. No one knows the latency period for CJD in humans, but
it is estimated at 10 years. Because of this uncertainty, as was with AIDS, no
one is sure how many people in England already have contracted the disease but
are not yet showing symptoms.
History Of Transmissible Spongiform Encephalopathies (TSE) and Scrapie
The history of Transmissible Spongiform Encephalopies (TSE) can be
traced back to England in the mid-1700s in the form of a disorder called
"scrapie" found mostly in sheep and goats. Originally thought to be a genetic
disease, scrapie was believed to be inherent in poorly bred animals. This belief
continued through the 1930s when French researchers proved that it was not
transferred genetically, but in fact was infectious. American scientists later
discovered that they were able to transmit scrapie from sheep to cows by
injecting infectious material into their brains.
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In England, at times scrapie had become quite prevalent. Over the past
couple of centuries it was believed that at one time or another as many as
one-third of British sheep had been infected with the disease. The disease
secured its first known foothold in the United States in 1947, when an outbreak,
traced to an import of purebred Suffolk sheep, was reported in Michigan. In
1952, when scrapie outbreaks were reported in California and Ohio, the United
States Department of Agriculture (USDA) launched the first of two eradication
programs, requiring the slaughter of entire herds infected with even a single
case of scrapie. Farmers and sheep herders concerned with protecting their
financial interests became reluctant to report suspected cases, and scrapie was
"driven underground." From the mid-1950s through the mid-1970s, a few flocks
yearly in the U.S. were reported infected, numbers that the USDA felt were too
small to be credible. To combat scrapie secrecy, in 1978 the USDA instituted the
Scrapie-Eradication Program, a program of reimbursing farmers two thirds of the
appraised value, up to $300 per animal, of the sheep sacrificed in their entire
flocks suspected of carrying scrapie. In 1983, it was decided that the revised
USDA policy for farmers would be to kill (and be reimbursed for) only infected
sheep and their immediate relatives not their entire flocks. Upon revision of
the USDA policy, reports of scrapie increased. In 1992, for a combination of
scientific and budgetary reasons, the Scrapie-Eradication Program was
dismantled. In 1992, farmers were given six months to report sick sheep for
reimbursement, and then the program officially closed. In the U.S. today, a
voluntary system is in place under which farmers can apply to have their sheep
certified "scrapie-free."
Scrapie is important because it is believed that it is the origin of
Bovine Spongiform Encephalopathy (BSE), or mad-cow disease. It is widely
believed that scrapie jumped species when farmers began feeding infected sheep
to cattle as a means of providing the cattle with a cheap form of protein.
Bovine Spongiform Encephalopathy (BSE)
Bovine Spongiform Encephalopathy (BSE), a prion disease also known as
mad-cow disease, is a progressive, lethal central nervous system disease which
targets cattle. BSE is characterized by the appearance of vacuoles, or clear
holes, in neurons in the brains of affected cattle that give the brain the
appearance of a sponge or spongiform. BSE was initially recognized in cattle in
the United Kingdom in 1986. After its discovery, research led scientists to the
9
conclusion that the bovine agent had originated from a scrapie agent, which has
been present within sheep in the United Kingdom for over 200 years. It is
presumed that the scrapie agent jumped species and moved into cattle when sheep
offal (the leftover parts of butchered animals) were ground down and included as
a protein supplement in cattle feed. As cattle that had ingested the diseased
scrapie began to die, cattle carcasses and offal were then themselves ground
down and used as a protein supplement for future cattle feed. In essence, the
epidemic of mad-cow disease was caused by an innovation of feeding dead cows to
live cows. Cows and sheep are, by nature, herbivores (vegetarians). Further
research has concluded that mad-cow disease was transmitted through such feed,
and especially through certain tissues of the offal including the brain, spinal
cord, eyes, spleen and certain nerve tissues.
BSE in cattle in Europe had reached epidemic proportions by 1992 more
than 1,000 cases were being reported. Between 1987 and 2000 over 180,000 cattle
were identified as having BSE in countries including UK, Ireland, Portugal,
France and Switzerland.
Chronic Wasting Disease (CWD)
Chronic wasting disease, another TSE, was diagnosed more than a decade
ago in mule deer and elk in Colorado and Wyoming. Since 1981, CWD has been
spreading slowly among wild deer and elk herds in the Rocky Mountains, and now
afflicts between 4% and 8% of 62,000 deer in the region between Fort Collins,
Colorado and Cheyenne, Wyoming.
During 1999, CWD erupted among a herd of elk on a farm near
Philipsburg, Montana which raised elk commercially. A few of the elk which had
been shipped by the farm to other destinations in the United States were
subsequently discovered to be infected with CWD. Montana health authorities
slaughtered 81 elk on the farm, and initially announced plans to incinerate the
carcasses. Upon determination that incineration would be too expensive, the
animals, together with the equipment used to feed, water and care for the
animals, were buried at a landfill. Montana authorities announced that the fence
line at the elk farm would be decontaminated, but they did not say what
procedure they would use, nor did they announce what would become of the
contaminated land. The disease agent that causes CWD - a prion protein - is very
hardy and resists destruction by traditional sterilization techniques like
alcohol and heat.
10
In northeastern Colorado and southeastern Wyoming, state officials are
urging hunters to protect themselves when dressing wild deer and elk which they
have shot. Hunters should wear rubber gloves, minimize contact with brain and
spinal cord tissues, discard the brain, spinal cord, eyes, spleen and lymph
nodes and refrain from eating any of these organs. Although there is no evidence
that CWD can cross over from deer and elk to humans, because there was
previously no firm evidence that mad cow disease could afflict humans until
1999, wildlife officials in the Rocky Mountains states believe caution is
warranted.
Creutzfeldt-Jakob Disease (CJD)
BSE in humans is referred to Creutzfeldt-Jakob Disease. In its natural
form, CJD was first described in the 1920s by German physicians Has Gerhard
Creutzfeldt and Alfons Jakob. Symptoms vary, but may include loss of
coordination, personality changes, mania and dementia. In the United States
approximately 250 cases are diagnosed each year. Confirming a diagnosis of CJD
has historically been difficult as traditional laboratory tests have been
ineffective in detecting CJD. The disease does not induce a fever or other
systemic manifestations. Accordingly, a definitive diagnosis of CJD has
traditionally required a brain biopsy or autopsy which can detect the
characteristic changes in the brain tissue caused by the disease. Moreover, a
brain biopsy may sometimes produce a false-negative result if the biopsied area
was unaffected by the disease. The difficulties involved in diagnosing CJD may
have prevented the identification of the disease in some cases. Because brain
biopsy for diagnosing CJD is invasive, costly and risky, it is often not
performed. Additionally, some physicians may not consider the possibility of a
CJD diagnosis since the disease is deemed to be rare and the clinical symptoms
of CJD can often be attributed to other ailments. Consequently, CJD may be
mistaken for a variety of psychological illnesses and other neurological
disorders including Alzheimer's disease, Huntington's Disease and vascular
irregularities. The extent to which such misdiagnosis may have occurred is
presently unknown. Currently, fewer than 10% of all deaths are investigated with
an autopsy, and even a smaller percentage of victims of dementia. The disease is
inevitably fatal as at the present time there is no known effective treatment or
cure for CJD.
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Our Solution
Many non-invasive TSE screening methods are not effective early
detection methods. We intend to develop screening tests that we believe will
allow for the direct early detection of several types of TSE diseases. The first
application of our technologies will be to undertake TSE screening. We believe
veterinarians will order tests to screen for the presence of TSE every one to
two years. Through regular screening, we believe that tests using our developed
technology will enable the detection of TSE earlier, so that the animals may be
properly destroyed and avoid these diseased animals from entering the food
chain.
We believe TSE screening tests using our technologies could become a
widely accepted and regularly used screening tool as a result of certain
features and benefits including earlier detection, higher sensitivity, higher
compliance and scalability.
Our goal is to become a contender in the early detection of TSE. The
key components of our strategy include:
- Developing TSE screening technologies. We selected TSE as the first
technology because the target market is large and not well served. Once
developed, we intend to license our proprietary technologies and sell reagents
to leading clinical reference laboratories to enable them to develop tests. We
may also package our technologies and seek approval for diagnostic test kits
with which any clinical laboratory could conduct our tests.
- Extend our screening technologies to other neurological disorders. We
believe that our to-be-developed technologies will be applicable to the early
detection of several other types of neurological disorders. We also believe that
certain of our technologies will allow for the early detection without knowledge
of the precise basis of the disorder. As a result, we may be able to develop
tests for disorders before the basis of such disorders is discovered.
Product Research and Development
We intend to conduct extensive product research and development
activities, and these research and development activities are expected to play a
major role in our projected future growth. In conjunction with the
implementation of our plan of operation, we will hire and establish research
teams. These research teams will attempt to develop new technology and new
applications for existing technology. In our development and testing, we also
intend to consult with scientific and medical professionals at universities,
12
hospitals and medical schools. Despite the fact that there can be no assurance
that the technologies and/or pharmaceutical compounds that we may develop will
ultimately prove to be profitable, we anticipate that we will spend the
necessary capital on research and development in the foreseeable future in order
to enhance pharmaceutical properties, and to develop new potential products. We
are unable at this time to estimate the total amount which will be spent on
research and development by us, however, our actual ability to conduct this
research and development is dependent upon securing sufficient working capital.
See "Risk Factors."
Government Regulation
We will be subject to extensive regulation by the United States Food
and Drug Administration (FDA) under the Federal Food, Drug and Cosmetic Act, as
well as regulations governing the development, marketing, labeling, promotion,
manufacturing and export of our products.
Generally medical devices, a category that will include our
to-be-developed products, require FDA approval or clearance before they may be
marketed. The FDA has not, however, actively regulated laboratory tests that
have been developed and used by the laboratory conducting the tests. The FDA
does regulate the sale of reagents used in laboratory tests. The FDA refers to
the reagents used in these tests as analyte specific reagents. Analyte specific
reagents react with a biological substance to identify a specific DNA sequence
or protein and generally do not require FDA approval or clearance if they are
used in in-house laboratories or are sold to clinical laboratories certified by
the government to perform high complexity testing and are labeled in accordance
with FDA requirements, including a statement that their analytical and
performance characteristics have not been established. A similar statement would
also be required on all advertising and promotional materials relating to
analyte specific reagents such as those to-be-developed by us. Laboratories also
are subject to restrictions on the labeling and marketing of tests that have
been developed using analyte specific reagents. The analyte specific reagent
regulatory category is relatively new and its boundaries are not well defined,
13
and there has been some discussion within the government of changing the analyte
specific reagent regulation, although it is not certain whether any such changes
would affect our plan of operation. In the event we are successful in
implementing our plan of operation, we believe that our in-house testing and the
analyte specific reagents that we intend to sell to leading clinical reference
laboratories will not require FDA approval or clearance. We cannot be sure,
however, that the FDA will not assert that our tests or one or more of our
to-be-developed reagents require premarket approval or clearance. In addition,
we cannot be sure that the FDA will not treat the licensing of our intellectual
property as labeling that would subject the reagent to premarket approval or
clearance and other FDA regulation. In addition, we cannot be sure that the FDA
will not change its position in ways that could negatively affect our
operations.
Any diagnostic test kits that we may sell would require FDA approval or
clearance before they could be marketed. There are two review procedures by
which a product may receive such approval or clearance. Some products may
qualify for clearance under a premarket notification, or 510(k) procedure, in
which the manufacturer provides to the FDA a premarket notification that it
intends to begin marketing the product, and demonstrates to the FDA's
satisfaction that the product is substantially equivalent to a legally marketed
product, which means that the product has the same intended use as, is as safe
and effective as, and does not raise different questions of safety and
effectiveness than a legally marketed device. A 510(k) submission for an
in-vitro diagnostic device generally must include manufacturing and performance
data, and in some cases, it must include data from human clinical studies.
Marketing may commence when the FDA issues a clearance letter.
If a medical device does not qualify for the 510(k) procedure, the FDA
must approve a premarket approval application, or PMA, before marketing can
begin. PMA applications must demonstrate, among other matters, that the medical
device is safe and effective. A PMA application is typically a complex
submission, usually including the results of preclinical and extensive clinical
studies. Before FDA will approve a PMA, the manufacturer must pass an inspection
of its compliance with the requirements of the FDA's quality system regulations.
Assuming that we are successful in implementing our business plan, we
believe that most, if not all, of the products which we anticipate we will
develop and sell in diagnostic test kit form will require PMA approval. The PMA
process is lengthy and costly, and we cannot be sure that the FDA will approve
PMAs for our products in a timely fashion, if at all. FDA requests for
additional studies during the review period are not uncommon, and can
significantly delay approvals. Even if we were able to gain approval of a
product for one indication, changes to the product, its indication, or its
labeling would be likely to require additional approvals.
14
Regardless of whether a medical device requires FDA approval or
clearance, a number of other FDA requirements apply to its manufacturer and to
those who distribute it. Device manufacturers must be registered and their
products listed with the FDA, and certain adverse events and product
malfunctions must be reported to the FDA. The FDA also regulates the product
labeling, promotion, and in some cases, advertising, of medical devices.
Manufacturers must comply with the FDA's quality system regulation which
establishes extensive requirements for quality control and manufacturing
procedures. Thus, manufacturers and distributors must continue to spend time,
money and effort to maintain compliance, and failure to comply can lead to
enforcement action. The FDA periodically inspects facilities to ascertain
compliance with these and other requirements.
We will also be subject to U.S. and state laws and regulations
regarding the operation of clinical laboratories. The federal Clinical
Laboratory Improvement Act and laws of certain other states, impose
certification requirements for clinical laboratories, and establish standards
for quality assurance and quality control, among other things. Clinical
laboratories are subject to inspection by regulators, and the possible sanctions
for failing to comply with applicable requirements. Sanctions available under
the Clinical Laboratory Improvement Act include prohibiting a laboratory from
running tests, requiring a laboratory to implement a corrective plan, and
imposing civil money penalties. If we should fail to meet the requirements of
the Clinical Laboratory Improvement Act or state law, we could incur significant
expense.
Any failure by us to comply with these laws, rules and regulations
could lead to stringent sanctions, including withdrawal of products from the
market, recalls, refusal to authorize government contracts, product seizures,
civil money penalties, injunctions and criminal prosecution.
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Competition
The clinical laboratory business is intensely competitive and we
believe that consolidation will continue in the clinical laboratory testing
business. Competitors in this segment range in size from small private companies
to large multinational corporations. We will seek to compete only in very
specific market niches and will not attempt to pursue the most competitive
general diagnostics markets. We believe, although there are no assurances, that
we will be able to compete based on our technological ability to provide
customers with very specific tests, assuming we are successful in implementing
our plan of operations. Our prospective competitors will include Abbot
Laboratories, bioMerieux, Inc., Roche Diagnostics, BioChem Pharma, Inova,
diaSorin, Bayer, Bio-Rad, Paradigm and Medical Analysis Systems. In the intense
competitive environment that is the pharmaceutical industry, those companies
that complete clinical trials, obtain regulatory approval and commercialize
their drug products first will enjoy competitive advantages.
To our knowledge, none of the large or diagnostics companies are
developing tests to conduct blood, urine or feces-based TSE testing; however,
companies may be working on such tests that have not yet been announced. In
addition, other companies may succeed in developing or improving technologies
and marketing products and services that are more effective or commercially
attractive than those which may be developed or offered by us. Most of these
companies may be larger than we are and will be able to commit significantly
greater financial and other resources to all aspects of their business,
including research and development, marketing, sales and distribution.
Employees
We employ a total of three employees, all of whom work full-time. We
have no collective bargaining agreements with any unions and believe that our
overall relations with our employees are excellent.
Property
We lease approximately 1,000 square feet of space on a month to month
lease for approximately $700 per month at 20283 State Road 7, Suite 400, Boca
Raton, Florida 33498. We believe that these facilities are adequate to meet our
current and foreseeable requirements and that suitable additional or substitute
space will be available on commercially reasonable terms if needed.
16
RISK FACTORS
Before you invest in our securities, you should be aware that there are
various risks, including those described below. You should consider carefully
these risk factors together with all of the other information included in or
incorporated by reference into this prospectus before you decide to purchase our
securities.
Some of the information in this prospectus may contain forward-looking
statements. These statements can be identified by the use of forward-looking
words such as "may," "will," "expect," "anticipate," "estimate," "continue" or
other similar words. These statements discuss future expectations, contain
projections of results of operations or financial condition or state other
"forward-looking" information. When considering such forward-looking statements,
you should keep in mind the risk factors and other cautionary statements in or
incorporated by reference into this prospectus. The risk factors noted in this
section and other factors noted throughout this prospectus or incorporated
herein, including certain risks and uncertainties, could cause our actual
results to differ materially from those contained in any forward-looking
statement.
We have a history of losses, an accumulated deficit and we anticipate
continuing losses which may result in significant liquidity and cash flow
problems. Although we are presently refocusing our plan of operation, there are
no assurances we will ever report profitable operations.
We incurred operating losses since our inception and have an
accumulated deficit of ($1,371,858) at April 30, 2001. For the three months
ended April 30, 2001, we incurred a net loss of ($28,158). For the years ended
January 31, 2001 and 2000, we incurred net losses of ($553,096) and ($728,849),
respectively. Our liquidity has substantially diminished because of these
continuing operating losses. Although we recently acquired Disease SI, a
development stage company, and it is our intention to divest of our
Internet-related operations as soon as practicable so that our focus can be on
the implementation of Disease SI's business plan, future profitability will
depend on substantial increases in revenues from operations. We do not presently
anticipate that we will generate any sufficient revenues in the foreseeable
future. As a result, we may experience significant liquidity and cash flow
problems which will require us to raise additional capital to continue
operations.
17
Disease SI has no operating history.
Disease SI has no operating history, and it has not generated any
revenues to date. We do not expect operating revenue from Disease SI in the
foreseeable future. We expect Disease SI to generate losses resulting
principally from costs incurred in conjunction with its research and development
initiatives. These research and development expenses will include costs related
to scientific and laboratory personnel, clinical studies and reagents and
supplies used in the development of its technologies. We expect that the cost of
its research and development activities will increase substantially as Disease
SI continues activities relating to the development of a TSE screening test, and
the extension of its technologies to several other forms of TSE. Disease SI is
planning clinical studies, the costs of which will be borne by it. We are unable
at this time to project the costs of these clinical studies due to the early
stage of Disease SI's development. We also expect general and administrative
expenses for Disease SI to increase significantly as its hires additional
personnel and builds its infrastructure to support future projected growth.
These general and administrative expenses are expected to consist primarily of
non-research personnel salaries, office expenses and professional fees. We will
be required to raise additional capital to fund these anticipated losses. There
are no assurances that we will be able to obtain the additional capital in which
event our future operations would be materially and adversely affected.
We may need additional financing which we may not be able to obtain on
acceptable terms. If we are unable to raise additional capital as needed, the
future growth of our business and operations would be severely limited.
Our plan of operations requires substantial capital investment. Our
future capital requirements, however, depend on a number of factors, including
our ability to develop our targeted products and to establish strategic
relationships that enable us to manufacture and market our targeted products
under cost-savings arrangements. Our ability to implement our plan of operation
will depend upon our ability to raise additional capital, possibly through the
issuance of long-term or short-term indebtedness or the issuance of our equity
securities in private or public transactions.
18
If we raise additional capital through the issuance of debt, this will
result in increased interest expense. If we raise additional funds through the
issuance of equity or convertible debt securities, the percentage ownership of
Disease Sciences held by existing shareholders will be reduced and those
shareholders may experience significant dilution. In addition, new securities
may contain certain rights, preferences or privileges that are senior to those
of our common stock. There can be no assurance that acceptable financing
necessary to implement our plan of operation can be obtained on suitable terms,
if at all. Our ability to develop our business would suffer if we are unable to
raise the additional funds on acceptable terms which would have the effect of
limiting our ability to increase our revenues or possibly attain profitable
operations in the future.
The development of our products will involve a lengthy and complex process.
Before we can commercialize our to-be-developed products, we will need
to conduct substantial research and development, undertake preclinical and
clinical testing and pursue regulatory approvals. This process involves a high
degree of risk and takes several years. Assuming we are developing a product,
of which there can be no assurance, our product development efforts may fail for
many reasons, including failure of the product in preclinical studies, clinical
trial data that is insufficient to support the safety or effectiveness of the
product or our failure to obtain the required regulatory approvals. In addition,
other companies may develop and market methods similar to those proposed by us
which could make our technologies, if and when developed, less competitive or
even obsolete. For these reasons, and others, we may not successfully
commercialize any of the products we proposes to develop.
Any marketable products developed may not be commercially successful.
Even if we develop products and obtain regulatory approval, those
products may not be accepted by the market, or approved for reimbursement by
third-party payors. A number of factors may affect the rate and level of market
acceptance of these products, including regulation by the FDA and other
government authorities including the USDA, market acceptance by administrators,
the effectiveness of our to be established sales force, the effectiveness of our
to be established production and marketing capabilities or the success of
competitive products. If our to-be-developed products are not commercially
successful, our results of operations and liquidity will be materially adversely
affected.
19
We may be unable to establish a favorable manufacturing and marketing
relationship with a third party which could adversely affect our future
prospects.
We do not intend to manufacture or market any products we may develop.
We intend to license to, or enter into strategic alliances with, established
pharmaceutical companies that are equipped to manufacture and/or market our
to-be-developed products through their distribution networks. No assurances can
be given that we will be successful in negotiating relationships with these yet
to-be-identified pharmaceutical companies upon business terms which are
favorable to us. As we will not have sufficient capital or expertise to enable
us to establish our own manufacturing capabilities, any failure on our part to
establish favorable relationships will adversely affect our ability to generate
revenues.
Our inability to establish strong business relationships with leading clinical
reference laboratories to perform tests using our to-be-developed technologies
will limit our revenue growth.
Our plan of operation is dependent upon the establishment of business
arrangements with academic and research institutions, as well as contract
research organizations, to utilize such facilities on a contractual or
collaborative basis. We do not currently have any business relationships with
laboratories, and we have limited experience in establishing these business
relationships. If we are unable to establish business relationships, we will
have limited ability to generate revenues. No assurances can be given that these
business relationships can be established, or if established, that the terms
will be favorable to us.
If we are unable to gain the support of key scientific collaborators, it may be
difficult to establish our to-be-developed technologies as a standard which may
limit our revenue growth.
We are presently seeking to establish relationships with leading
scientists which we believe is key to establishing tests using our
to-be-developed technologies as a standard. We cannot guarantee that we will be
successful in establishing these relationships. Even if we are successful, if
any of these scientific collaborators subsequently determine that tests using
our to-be-developed technologies are not superior to available screening tests
or that alternative technologies would be more effective in the early detection
of BSE, we would encounter difficulty establishing tests using our proposed
technologies as a standard, which would limit our anticipated revenue growth and
profitability.
20
Our future success depends on our key personnel.
We rely on our key management personnel. We are substantially dependent
on the services of Dr. Goldstein, our Chief Executive Officer. Our strategic
planning and key decisions will be made primarily by him. Dr. Goldstein filed a
Petition for Chapter Seven bankruptcy and on July twenty-ninth, nineteen hundred
ninety-nine, received a Discharge of Debtor. Future success will also depend
upon our ability to attract and retain additional highly skilled personnel. The
competition for employees at all levels in the area of our target business is
intense and is increasing. As a result, if we fail to retain existing employees
or hire new employees when necessary, our business, financial condition and
operating results could be materially and adversely affected.
If we fail to obtain the approval of the FDA or comply with other FDA
requirements, we may not be able to market our proposed products and services
and may be subject to stringent penalties.
The products we have targeted for development will require FDA approval
in the USA and will likely undergo a series of long term clinical trials. The
products will have to likely go through similar testing in foreign
jurisdictions. Their tests are also subject to successful completion of limited
trials in the USA and require standardization with respect to methods of use and
packaging, subject to FDA approval. There can be no assurance that the tests and
trials will ultimately be successful or that the products, if developed, can be
commercialized, or approved for use, in either the USA or any other foreign
jurisdiction.
The FDA does not actively regulate laboratory tests that have been
developed and used by the laboratory conducting the test. Although the FDA does
regulate reagents, such as those proposed to-be-developed by us that react with
a biological substance to identify a specific DNA sequence or protein, its
regulations provide that most such reagents, which the FDA refers to as analytic
specific reagents, are exempt from the FDA's remarket review requirements. If
the FDA were to decide to regulate in-house developed laboratory tests, decide
to require premarket approval or clearance of our proposed analyte specific
reagents, conclude that our to-be-developed reagents do not meet the
21
requirements for analyte specific reagents, or conclude that licensing our
to-be-developed intellectual property constitutes non-compliant labeling, the
commercialization of our proposed products and services could be delayed, halted
or prevented. Finally, our to-be-developed analyte specific reagents will be
subject to a number of FDA requirements, including a requirement to comply with
the FDA's quality system regulation which establishes extensive regulations for
quality control and manufacturing procedures. Failure to comply with these
regulations could subject us to enforcement action. Adverse FDA action in any of
these areas could significantly increase our expenses and limit our revenue and
profitability potentials.
If we fail to comply with regulations relating to clinical laboratories, we may
be prohibited from processing our own tests in-house, be required to incur
significant expense to correct non-compliance, or be subject penalties.
Once we establish our own laboratory, we will be subject to U.S. and
state laws and regulations regarding the operation of clinical laboratories. For
example, the federal Clinical Laboratory Improvement Act imposes certification
requirements for clinical laboratories, and establishes standards for quality
assurance and quality control, among other things. Clinical laboratories are
subject to inspection by regulators, and the possible sanctions for failing to
comply with applicable requirements include prohibiting a laboratory from
running tests, requiring a laboratory to implement a corrective plan, and
imposing civil money or criminal penalties. If, in the future, we should fail to
meet the requirements of the Clinical Laboratory Improvement Act, we could be
required to halt providing services and incur significant expense, thereby
limiting our revenue and profitability potential.
We may fail to adequately protect our intellectual property once developed,
which could adversely affects our plan of operations.
As we develop our products we may apply for trademarks, service marks
or patents. Any future inability to obtain trademarks, service marks and/or
patents could have a materially adverse effect on our plan of operation. The
patent positions of pharmaceutical and biotechnology companies can be highly
uncertain and involve complex legal and factual questions. Accordingly, the
breadth of claims allowed in these companies' patents cannot be predicted.
Patent disputes are frequent and can preclude commercialization of products. We
may, in the future, be involved in material patent litigation. Patent litigation
is costly in its own right and could subject us to significant liabilities to
third-parties and, if decided adversely, we may need to obtain third-party
22
licenses at a material cost or cease using the technology or product in dispute.
The presence of patents or other proprietary rights belonging to other parties
may lead to the termination of the research and development of a particular
product.
Our long-term success largely depends on our ability to market
technologically competitive products. If we fail to obtain or maintain
intellectual property protections we may not be able to prevent third parties
from using our to-be-developed proprietary rights. Any future patent
applications made by us may not result in issued patents. In the United States,
patent applications are confidential until patents are issued, and because third
parties may have filed patent applications for technology which we have targeted
for development without us being aware of those applications, our future patent
applications, if and when made, may not have priority over any patent
applications of others. In addition, even if we are successful in the
development of patentable products and secure such patents, the issued patents
may not contain claims sufficiently broad to protect us against third parties
with similar technologies or products or provide us with any competitive
advantage. If a third party initiates litigation regarding our to-be-developed
products or patents, our collaborators' patents, or those patents for which we
may have acquired license rights, and is successful, our business prospects
would be materially adversely affected.
We may be unsuccessful in expanding our operations through joint ventures or
strategic alliances which could adversely affect our future prospects. Likewise,
we may seek to make acquisitions which could divert management time and
ultimately fail to have any benefit to our proposed plan of operations.
We may choose to expand our operations by entering into joint ventures
or other strategic alliances with third parties. Any such transaction would be
accompanied by the risks commonly encountered in such transactions. These
include, among others, the difficulty of assimilating the operations and
personnel and other various factors. There can be no assurance that we will be
successful in overcoming these risks or any other problems encountered in
connection with joint ventures or other strategic alliances, or that such
transactions will not have a material adverse effect on our business, financial
condition and results of operations.
23
In addition, we may make acquisitions with cash or with stock or a
combination thereof. If we do make any such acquisitions, various associated
risks may be encountered, including potential dilution to our existing
shareholders, possible goodwill amortization which could negatively effect our
earnings, assuming we ever achieve any level of profitability of which there is
no assurance, diversion of management's attention, possible regulatory costs and
unanticipated problems or liabilities, some or all of which could have a
materially adverse effect on our financial condition or results of operations.
There is only a limited public market for our shares, and if an active market
does not develop, investors may have difficulty selling their shares
There is a limited public market for our common stock. We cannot
predict the extent to which investor interest in us will lead to the development
of an active trading market or how liquid that trading market might become. If a
trading market does not develop or is not sustained, it may be difficult for
investors to sell shares of our common stock at a price that is attractive. As a
result, an investment in our common stock may be illiquid and investors may not
be able to liquidate their investment readily or at all when he/she desires to
sell.
DISEASE SCIENCES, INC. 2000 MANAGEMENT AND DIRECTOR
EQUITY INCENTIVE AND COMPENSATION PLAN
In August 2000, our Board of Directors adopted our 2000 Management and
Director Equity Incentive and Compensation Plan (the "Plan"). We have filed an
Information Statement with the SEC related to the approval of the Plan, as
subsequently amended by our Board of Directors, by a majority of our
shareholders which is expected to occur on August 15, 2001. The purpose of the
Plan is to advance our interests and those of our shareholders by providing a
means of attracting and retaining key employees, directors and consultants. In
order to serve this purpose, we believe this Plan encourages and enables key
employees, directors and consultants to participate in our future prosperity and
growth by providing them with incentives and compensation based on our
performance, development and financial success. Participants in the Plan may
include our officers, directors, other key employees and consultants who have
responsibilities affecting our management, development or financial success.
24
We have reserved an aggregate of 10,000,000 shares of common stock for
issuance under the Plan. At July 31, 2001 we had granted options under our 2000
Management and Director Equity Incentive and Compensation Plan to purchase
2,250,000 shares of our common stock. Until such time as we have completed an
initial public offering, our Board of Directors (or at their discretion a
committee of our board members) administers the Plan including, without
limitation, the selection of recipients of awards under the Plan, the granting
of stock options, restricted share or performance shares, the determination of
the terms and conditions of any such awards, the interpretation of the Plan and
any other action they deem appropriate in connection with the administration of
the Plan. Following such initial public offering, the Plan will be administered
by a committee of our board of directors who will be comprised of not less than
two non-employee directors.
Awards may be made under the Plan in the form of Plan options, shares
of our common stock subject to a vesting schedule based upon certain performance
objectives ("performance shares") and shares subject to a vesting schedule based
on the recipient's continued employment ("restricted shares"). Plan options may
either be options qualifying as incentive stock options under Section 422 of the
IRS Code, or options that do not so qualify. Any incentive stock option granted
under our Plan must provide for an exercise price of not less than 100% of the
fair market value of the underlying shares on the date of such grant, but the
exercise price of any incentive option granted to an eligible employee owning
more than 10% of our common stock must be at least 110% of such fair market
value as determined on the date of the grant. Only persons who are our officers
or other key employees are eligible to receive incentive stock options and
performance share grants. Any non-qualified stock option granted under our Plan
must provide for an exercise price of not less than 50% of the fair market value
of the underlying shares on the date of such grant.
The term of each Plan option and the manner in which it may be
exercised is determined by the Board of Directors, provided that no Plan option
may be exercisable more than three years after the date of its grant and, in the
case of an incentive option granted to an eligible employee owning more than 10%
of our common stock, no more than five years after the date of the grant. The
exercise price of the stock options may be paid in either:
25
- cash, or
- delivery of unrestricted shares of our common stock having a
fair market value on the date of delivery equal to the
exercise price, or
- surrender of shares of our common stock subject to the stock
option which has a fair market value equal to the total
exercise price at the time of exercise, or
- a combination of the foregoing methods.
All Plan options are non-assignable and nontransferable, except by will
or by the laws of descent and distribution and, during the lifetime of the
optionee, may be exercised only by such optionee. At the discretion of the Board
of Directors, it may approve the irrevocable transfer, without payment, of
non-qualified options to the option holder's spouse, children, grandchildren,
nieces or nephews, or to the trustee of a trust for the principal benefit of one
or more such persons, or to a partnership whose partners are one or more of such
persons. If an optionee's employment is terminated for any reason, other than
due to his or her death, disability or termination for cause, or if an optionee
is not our employee but is a member of our Board of Directors and his or her
service as a director is terminated for any reason, other than due to his or her
death or disability, the Plan option granted may be exercised on the earlier of
the expiration date or 90 days following the date of termination. If the
optionee dies during the term of his or her employment, the Plan option granted
to him or her shall lapse to the extent unexercised on the earlier of the
expiration date of the Plan option or the date one year following the date of
the optionee's death. If the optionee's employment, membership on the Board of
Directors or engagement as a consultant terminates by reason of the optionee's
retirement, then the Plan option granted may be exercised until the earlier of
90 days following the date of termination or the expiration date. If the
optionee is permanently and totally disabled within the meaning of Section
22(c)(3) of the IRS Code, the Plan option granted to him or her lapses to the
extent unexercised on the earlier of the expiration date of the option or one
year following the date of such disability.
26
At the time of the restricted share grant, the Board of Directors may
determine the vesting schedule of such shares and that after vesting, such
shares may be further restricted as to transferability or be subject to
repurchase by us or forfeiture upon the occurrence of certain events. Awards of
restricted shares must be accepted by the participant within 30 days of the
grant.
At the time of the award of performance shares, the Board of Directors
shall establish a range of performance goals to be achieved during the
performance period including, without limitation, earnings, return on capital,
or any performance goal approved by our stockholders in accordance with Section
162(m) of the IRS Code. Attainment of the highest performance goal for the
performance period will earn 100% of the performance shares awarded for the
performance period; failure to attain the lowest performance goal will result in
the participant earning no performance shares. Attainment of the performance
goals will be calculated from our financial statements, excluding changes in
federal income tax rates and the effect of non-recurring and extraordinary
items. The performance goals may vary for difference performance periods and
need not be the same for each participant receiving an award during a
performance period.
If the participant's employment by us, membership on our Board of
Directors, or engagement by us as a consultant is terminated before the end of
any performance period, or upon the participant's death, retirement or
disability, the Board of Directors, taking into consideration the performance of
such participant and our performance over the performance period, may authorize
the issuance to the participant or his or her legal representative or designated
beneficiary all or a portion of the performance shares which would have been
issued to him or her had the participant's employment, board membership or
consulting engagement continued to the end of the performance period. If the
participant's employment, board membership or consulting engagement terminates
before the end of the performance period for any other reason, all performance
shares are forfeited.
Notwithstanding the foregoing, but subject to any stockholder approval
or other requirements of Section 162(m) of the IRS Code, the Board of Directors
in its discretion and as determined at the time of award of the performance
shares, may provide the participant with the option of receiving cash in lieu of
the performance shares in an amount determined at the time of award including,
without limitation, by one or more of the following methods:
27
- the fair market value of the number of shares subject to the
performance shares agreement on the date of award, or
- part or all of any increase in the fair market value since
such date, or
- part or all of any dividends paid or payable on the number of
shares subject to the performance share agreement, or
- any other amounts which in the board's sole discretion are
reasonably related to the achievement of the applicable
performance goals, or
- any combination of the foregoing.
The purchase price for restricted shares or performance shares granted
under the Plan shall be set by the Board of Directors but may not be less than
par value. Payment of the purchase price for the restricted shares or
performance share may be made in either,
- cash, or
- by delivery of unrestricted shares of our common stock having
a fair market value on the date of such delivery equal to the
total purchase price, or
- a combination of either of these methods.
The restricted stock awards, performance stock awards and stock options
are subject to accelerated vesting in the event of our change of control. We
may, at our option, terminate all unexercised stock options 30 days after a
change in control and pay to the participant holding these unexercised options
cash in an amount equal to the difference between fair market value and the
exercise price of the stock option. If the fair market value is less than the
exercise price, we may terminate the options without payment to the holder. The
per share purchase price of shares subject to Plan options granted under the
Plan or related to performance share awards or restricted share awards may be
adjusted in the event of certain changes in our capitalization, but any such
adjustment shall not change the total purchase price payable upon the exercise
in full of such option or award. No participant in our Plan has any rights as a
stockholder until the shares subject to the Plan options or stock awards have
been duly issued and delivered to him or her.
28
We have an option to purchase any shares of our common stock which have
been issued to Plan participants pursuant to restricted stock awards,
performance stock awards or stock options if the participant ceases to be our
employee, a member of our Board of Directors or a consultant to us for any
reason. We must exercise our repurchase right at the time of termination. The
purchase price for any shares we repurchase will be equal to the fair market
value of the our total stockholder's equity divided by the total outstanding
shares of our common stock on the last day of that calendar month, calculated on
a fully-diluted basis. If we exercise our repurchase right, we much close the
transaction within 20 days from the termination date. At closing, we are
entitled to delivery a one-year promissory note as payment for the purchase
price or, at our option, we may pay same in cash at closing.
We also have a right of first refusal to meet the offer if the holder
of any shares of our common stock awarded or issued pursuant to our Plan desires
to sell such shares to a third party.
The Board of Directors may amend, suspend or terminate our Plan at any
time, except that no amendment shall be made which:
- increases the total number of shares subject to the Plan or
changes the minimum purchase price therefore (except in either
case in the event of adjustments due to changes in our
capitalization), or
- affects outstanding Plan options or any exercise right
thereunder, or
- extends the term of any Plan option beyond 10 years, or
- extends the termination date of the Plan.
Unless the Plan shall be earlier suspended or terminated, the Plan
shall terminate 10 years from the date of the Plan's adoption by our
stockholders. Any such termination of our Plan shall not affect the validity of
any Plan options previously granted thereunder.
29
Federal Income Tax Effects
The following discussion applies to our Plan and is based on federal
income tax laws and regulations in effect on June 30, 2001. It does not purport
to be a complete description of the federal income tax consequences of the Plan,
nor does it describe the consequences of state, local or foreign tax laws which
may be applicable. Accordingly, any person receiving a grant under the Plan
should consult with his or her own tax adviser.
Our Plan is not subject to the provisions of the Employee Retirement
Income Security Act of 1974 and is not qualified under Section 401(a) of the IRS
Code.
An employee granted an incentive stock option does not recognize
taxable income either at the date of grant or at the date of its timely
exercise. However, the excess of the fair market value of common stock received
upon exercise of the incentive stock option over the option exercise price is an
item of tax preference under Section 57(a)(3) of the IRS Code and may be subject
to the alternative minimum tax imposed by Section 55 of the IRS Code. Upon
disposition of stock acquired on exercise of an incentive stock option,
long-term capital gain or loss is recognized in an amount equal to the
difference between the sales price and the incentive stock option exercise
price, provided that the option holder has not disposed of the stock within two
years from the date of grant and within one year from the date of exercise. If
the incentive stock option holder disposes of the acquired stock (including the
transfer of acquired stock in payment of the exercise price of an incentive
stock option) without complying with both of these holding period requirements
("Disqualifying Disposition"), the option holder will recognize ordinary income
at the time of such Disqualifying Disposition to the extent of the difference
between the exercise price and the lesser of the fair market value of the stock
on the date the incentive stock option is exercised (the value six months after
the date of exercise may govern in the case of an employee whose sale of stock
at a profit could subject him to suit under Section 16(b) of the Securities
Exchange Act of 1934) or the amount realized on such Disqualifying Disposition.
Any remaining gain or loss is treated as a short-term or long-term capital gain
or loss, depending on how long the shares are held. In the event of a
Disqualifying Disposition, the incentive stock option tax preference described
above may not apply (although, where the Disqualifying Disposition occurs
subsequent to the year the incentive stock option is exercised, it may be
necessary for the employee to amend his or her return to eliminate the tax
preference item previously reported). We are not entitled to a tax deduction
upon either exercise of an incentive stock option or disposition of stock
acquired pursuant to such an exercise, except to the extent that the option
holder recognized ordinary income in a Disqualifying Disposition.
30
If the holder of an incentive stock option pays the exercise price, in
full or in part, with shares of previously acquired common stock, the exchange
should not affect the incentive stock option tax treatment of the exercise. No
gain or loss should be recognized on the exchange, and the shares received by
the employee, equal in number to the previously acquired shares exchanged
therefor, will have the same basis and holding period for long-term capital gain
purposes as the previously acquired shares. The employee will not, however, be
able to utilize the old holding period for the purpose of satisfying the
incentive stock option statutory holding period requirements. Shares received in
excess of the number of previously acquired shares will have a basis of zero and
a holding period which commences as of the date the common stock is issued to
the employee upon exercise of the incentive stock option. If an exercise is
effected using shares previously acquired through the exercise of an incentive
stock option, the exchange of the previously acquired shares will be considered
a disposition of such shares for the purpose of determining whether a
Disqualifying Disposition has occurred.
In respect to the holder of non-qualified options, the option holder
does not recognize taxable income on the date of the grant of the non-qualified
option, but recognizes ordinary income generally at the date of exercise in the
amount of the difference between the option exercise price and the fair market
value of the common stock on the date of exercise. However, if the holder of
non-qualified options is subject to the restrictions on resale of common stock
under Section 16 of the Securities Exchange Act of 1934, such person generally
recognizes ordinary income at the end of the six-month period following the date
of exercise in the amount of the difference between the option exercise price
and the fair market value of the common stock at the end of the six-month
period. Nevertheless, such holder may elect within 30 days after the date of
exercise to recognize ordinary income as of the date of exercise. The amount of
ordinary income recognized by the option holder is deductible by us in the year
that income is recognized.
In connection with the issuance of stock grants as compensation, the
recipient must include in gross income the excess of the fair market value of
the property received over the amount, if any, paid for the property in the
first taxable year in which beneficial interest in the property either is
"transferable" or is not subject to a "substantial risk of forfeiture." A
substantial risk of forfeiture exists where rights and property that have been
transferred are conditioned, directly or indirectly, upon the future performance
(or refraining from performance) of substantial services by any person, or the
occurrence of a condition related to the purpose of the transfer, and the
31
possibility of forfeiture is substantial if such condition is not satisfied.
Stock grants received by a person who is subject to the short swing profit
recovery rule of Section 16(b) of the Securities Exchange Act of 1934 is
considered subject to a substantial risk of forfeiture so long as the sale of
such property at a profit could subject the stockholder to suit under that
section. The rights of the recipient are treated as transferable if and when the
recipient can sell, assign, pledge or otherwise transfer any interest in the
stock grant to any person. Inasmuch as the recipient would not be subject to the
short swing profit recovery rule of Section 16(b) of the Securities Exchange Act
of 1934 and the stock grant, upon receipt following satisfaction of condition
prerequisites to receipt, will be presently transferable and not subject to a
substantial risk of forfeiture, the recipient would be obligated to include in
gross income the fair market value of the stock grant received once the
conditions to receipt of the stock grant are satisfied.
Restrictions Under Federal Securities Laws
The sale of our common stock issuable upon pursuant to our Plan must be
made in compliance with federal and state securities laws. Our officers,
directors and 10% or greater stockholders, as well as certain other persons or
parties who may be deemed to be "affiliates" of ours under federal securities
laws, should be aware that resales by affiliates can only be made pursuant to an
effective registration statement, Rule 144 promulgated under the Securities Act
or other applicable exemption. Our officers, directors and 10% and greater
stockholders may also be subject to the "short swing" profit rule of Section
16(b) of the Securities Exchange Act of 1934.
SALES BY SELLING SHAREHOLDERS
This prospectus covers shares of our common stock issuable upon the
grant of restricted stock awards, performance stock awards or the exercise of
options under our Plan and the subsequent resale of the shares of our common
stock by selling shareholders who are our affiliates. The shares of our common
stock being reoffered by our affiliates pursuant to this prospectus are deemed
to be control shares as that term is defined in Rule 405 of the Securities Act.
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The following table sets forth,
o the name of each selling shareholder who is our affiliate as that
term is defined in the Securities Act,
o the number of shares owned, and
o the number of shares being registered for resale by each
affiliated selling shareholder.
o the percentage of our common stock to be owned by the affiliated
selling shareholder following completion of such offering (based
on 80,768,922 shares of our common stock outstanding at July 31,
2001), and adjusted to give effect to the issuance of shares upon the
exercise of the named affiliate selling shareholder's options to be
offered hereby, but excludes shares issuable upon the exercise of any
other option held by the affiliated selling shareholder or any shares
issuable upon the exercise of any other person's options.
We may amend or supplement this prospectus from time to time to update
the disclosure set forth in the following table. All of the shares being
registered for resale under this prospectus for the selling shareholders may be
offered hereby. Because the selling shareholders may sell some or all of the
shares owned by them which are included in this prospectus, and because there
are currently no agreements, arrangements or understandings with respect to the
sale of any of the shares, no estimate can be given as to the number of shares
being offered hereby that will be held by the selling shareholders upon
termination of any offering made hereby. We have, therefore, for the purposes of
the following table assumed that the selling shareholders will, if applicable,
exercise the options described below, and sell all of the shares owned by them
which are being offered hereby, but will not sell any other shares of our common
stock that they presently own or which can be acquired upon the exercise of
options granted outside of our Plan.
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Beneficial ownership is determined in accordance with the rules of the
SEC and generally includes voting or investment power with respect to securities
and includes any securities which the person has the right to acquire within 60
days through the conversion or exercise of any security or other right. The
information as to the number of shares of our common stock owned by each selling
shareholder is based upon the information contained in a record list of our
shareholders at July 31, 2001.
Percentage
Shares to be to be Owned
Name of Selling Number of Shares to Owned After After
Shareholder Shares Owned be Offered Offering Offering
----------- ------------ ---------- ------------ -----------
Dr. Wayne Goldstein 36,000,000 (1) 1,000,000 35,000,000 43.3
Brian S. John 26,000,000 (2) 1,000,000 25,000,000 31.0%
---------
Total 2,000,000
(1) Includes shares of our common stock issuable upon the exercise of an
option to purchase 1,000,000 shares of our common stock.
(2) Includes shares of our common stock issuable upon the exercise of an
option to purchase 1,000,000 shares of our common stock.
PLAN OF DISTRIBUTION
The information under this heading relates to resales of shares of our
common stock covered by this prospectus by persons who are our "affiliates" as
that term is defined under federal securities laws.
The shares offered hereby by the selling shareholders may be resold and
distributed from time to time by the selling shareholders, or by pledgees,
donees, transferees or other successors in interest. These sales may be made on
one or more exchanges or in the over-the-counter market, or otherwise at prices
and at terms then prevailing or at prices related to the then current market
price, or in negotiated transactions. The shares may be sold by one or more of
the following methods including, without limitation:
- a block trade in which the broker-dealer so engaged will attempt to
sell the shares as agent, but may position and resell a portion of the
block as principal to facilitate the transaction;
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- purchases by a broker or dealer as principal and resale by a
broker or dealer for its account under this prospectus;
- ordinary brokerage transactions and transactions in which
the broker solicits purchasers;
- face-to-face or other direct transactions between the selling
shareholders and purchasers without a broker-dealer or other
intermediary; and
- ordinary brokerage transactions and transactions in which the
broker solicits purchasers.
In effecting sales, brokers or dealers engaged by the selling
shareholders may arrange for other brokers or dealers to participate in the
resales. Brokers, dealers or agents may receive compensation in the form of
commissions, discounts or concessions from selling shareholders in amounts to be
negotiated in connection with the sale. These broker-dealers and agents and any
other participating broker-dealers, or agents may be deemed to be "underwriters"
within the meaning of the Securities Act, in connection with the sales. In
addition, any securities covered by this prospectus that qualify for sale under
Rule 144 might be sold under Rule 144 rather than under this prospectus.
In connection with distributions of the shares or otherwise, the
selling shareholders may enter into hedging transactions with broker-dealers. In
connection with the transactions, broker-dealers may engage in short sales of
the shares registered hereunder in the course of hedging the positions they
assume with selling shareholders. The selling shareholders may also sell shares
short and deliver the shares to close out the positions. The selling
shareholders may also enter into option or other transactions with
broker-dealers which require the delivery to the broker-dealer of the shares
registered hereunder, which the broker-dealer may resell under this prospectus.
The selling shareholders may also pledge the shares registered hereunder to a
broker or dealer and upon a default, the broker or dealer may effect sales of
the pledged shares under this prospectus.
Information as to whether an underwriter(s) who may be selected by the
selling shareholders, or any other broker-dealer, is acting as principal or
agent for the selling shareholders, the compensation to be received by
underwriters who may be selected by the selling shareholders, or any
35
broker-dealer, acting as principal or agent for the selling shareholders and the
compensation to be received by other broker-dealers, in the event the
compensation of other broker-dealers is in excess of usual and customary
commissions, will, to the extent required, be set forth in a supplement to this
prospectus. Any dealer or broker participating in any distribution of the shares
may be required to deliver a copy of this prospectus, including the supplement,
if any, to any person who purchases any of the shares from or through a dealer
or broker.
We have advised the selling shareholders that during the time as they
may be engaged in a distribution of the shares included herein they are required
to comply with Regulation M of the Exchange Act. With certain exceptions,
Regulation M precludes any selling shareholders, any affiliated purchasers and
any broker-dealer or other person who participates in the distribution from
bidding for or purchasing, or attempting to induce any person to bid for or
purchase any security which is the subject of the distribution until the entire
distribution is complete. Regulation M also prohibits any bids or purchase made
in order to stabilize the price of a security in connection with the
distribution of that security. All of the foregoing may affect the marketability
of our common stock.
Sales of securities by us and the selling shareholders or even the
potential of these sales may have a negative effect on the market price for
shares of our common stock.
DESCRIPTION OF SECURITIES
Common Stock
We are authorized to issue 100,000,000 shares of common stock, par
value $.001 per share. As of July 31, 2001, there were 80,768,922 shares of
common stock outstanding. All outstanding shares of common stock are validly
authorized and issued, fully paid, and non-assessable.
The holders of common stock are entitled to one vote for each share
held of record on all matters submitted to a vote of shareholders. Holders of
common stock are entitled to receive ratably such dividends as may be declared
by the board of directors out of funds legally available therefor. In the event
of our liquidation, dissolution, or winding up, holders of our common stock are
entitled to share ratably in all of our assets remaining after payment of
liabilities and liquidation preferences of any outstanding shares of preferred
stock. Holders of common stock have no preemptive rights or other subscription
rights to convert their shares into any other securities.
36
Preferred Stock
Our Board of Directors has the authority, without further action by our
shareholders, to issue 1,000,000 shares of preferred stock, in one or more
series and to fix the privileges and rights of each series. These privileges and
rights may be greater than those of the common stock. Our Board of Directors,
without further shareholder approval, can issue preferred stock with voting,
conversion or other rights that could adversely affect the voting power and
other rights of the holders of common stock. This type of "blank check preferred
stock" makes it possible for us to issue preferred stock quickly with terms
calculated to delay or prevent a change in our control or make removal of our
management more difficult.
Transfer Agent
The transfer agent and registrar for our common stock is Olde Monmouth
Stock Transfer Co., Inc., 77 Memorial Parkway, Atlantic Highlands, NJ 07716.
37
LEGAL MATTERS
Certain legal matters in connection with the securities being offered
hereby will be passed upon for us by Atlas Pearlman, P.A., 350 East Las Olas
Boulevard, Suite 1700, Fort Lauderdale, Florida 33301.
EXPERTS
The consolidated financial statements of Disease Sciences, Inc.,
formerly known as AuctionAnything.com, Inc. and subsidiaries as of January 31,
2001 and 2000 and the related statements of operations, changes in stockholders'
equity and cash flows for the years ended January 31, 2001 and 2000,
incorporated by reference in this prospectus have been audited by Feldman Sherb
& Co., P.C., independent certified public accountants, as indicated in their
report with respect thereto, and are incorporated herein in reliance upon the
authority of said firm as experts in giving said report.
The audited financial statements of Disease S.I., Inc. for the period
from inception (April 17, 2001) through April 30, 2001 incorporated by reference
in this prospectus have been audited by Feldman Sherb & Co., P.C., independent
certified public accountants, as indicated in their report with respect thereto,
and are incorporated herein in reliance upon the authority of said firm as
experts in giving said report.
INDEMNIFICATION
Section 145 of the General Corporation Law of Delaware, under which we
are incorporated, empowers a corporation to indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative by reason of the fact that he or she is or was a director,
officer, employee or agent of the corporation or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation or enterprise. A corporation may indemnify against expenses
(including attorneys' fees) and, other than in respect of an action by or in the
right of the corporation, against judgments, fines and amounts paid in
settlement actually and reasonably incurred in connection with such action, suit
or proceeding if the person indemnified acted in good faith and in a manner he
or she reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. In the case of an
38
action by or in the right of the corporation, no indemnification of expenses may
be made in respect to any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the extent
that the Court of Chancery or the court in which such action was brought shall
determine that, despite the adjudication of liability, such person is fairly and
reasonably entitled to indemnity for such expenses which the court shall deem
proper. Section 145 of the General Corporation Law of Delaware further provides
that to the extent a director, officer, employee or agent of the corporation has
been successful in the defense of any action, suit or proceeding referred to
above or in the defense of any claim, issue or matter therein, he or she shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith.
Our certificate of incorporation and by-laws require us to indemnify
our directors and officers to the fullest extent permitted by the General
Corporation Law of the State of Delaware.
39
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
We have filed with the SEC a registration statement on Form S-8. This
prospectus is part of the registration statement. It does not contain all of the
information set forth in the registration statement. For further information
about Disease Sciences, Inc. and our common stock, you should refer to the
registration statement. Statements contained in this prospectus as to the
contents of any contract or other document referred to in this prospectus are
not necessarily complete. Where a contract or other document is an exhibit to
the registration statement, each of you should review the provisions of the
exhibit to which reference is made. You may obtain these exhibits from the SEC
as discussed below.
We are required to file annual, quarterly and special reports, proxy
statements and other information with the SEC. You may read and copy any
document we file at the SEC's public reference rooms in Washington, D.C., New
York, New York and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for
more information on the operation of the public reference rooms. Copies of our
SEC filings are also available to the public from the SEC's web site at
http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information filed with the
SEC will update and supersede this information. We incorporate by reference the
documents listed below, any of such documents filed since the date this
registration statement was filed and any future filings with the SEC under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act") until the offering is completed.
- our annual report on Form 10-KSB for the fiscal year ended
January 31, 2001, as amended on Form 10-KSB/A filed on
August 16, 2001,
- our quarterly report on Form 10-QSB for the quarter ended
April 30, 2001,
40
- our current reports on Form 8-K filed on June 6, 2001 and
June 7, 2001,
- our current report on Form 8-K/A filed on June 29, 2001,
- our Definitive Information Statements filed on June 18, 2001,
June 26, 2001 and July 23 2001; and
- our current report on Form 8-K/A as filed on July 26, 2001.
Any statement incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this prospectus to the extent that a
statement contained herein or in any other subsequently filed document, which
also is or is deemed to be incorporated by reference herein, modifies or
supersedes such statement. Any statement modified or superseded shall not be
deemed, except as so modified or superseded, to constitute part of this
prospectus.
You may request a copy of these filings, at no cost, by writing or
calling us at the following address and telephone number:
Corporate Secretary
Disease Sciences, Inc.
20283 State Road 7
Suite 400
Boca Raton, Florida 33498
Item 4. Description of Securities
A description of the our securities is set forth in the prospectus
incorporated as a part of this registration statement.
Item 5. Interests of Named Experts and Counsel
Not Applicable.
Item 6. Indemnification of Directors and Officers
Section 145 of the General Corporation Law of Delaware, under which
jurisdiction we are incorporated, empowers a corporation to indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative by reason of the fact that he or she is or was a
director, officer, employee or agent of the corporation or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation or enterprise. A corporation may indemnify against expenses
(including attorneys' fees) and, other than in respect of an action by or in the
right of the corporation, against judgments, fines and amounts paid in
41
settlement actually and reasonably incurred in connection with such action, suit
or proceeding if the person indemnified acted in good faith and in a manner he
or she reasonably believed to be in or not opposed to the best interests of the
corporation, and with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. In the case of an
action by or in the right of the corporation, no indemnification of expenses may
be made in respect to any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the extent
that the Court of Chancery or the court in which such action was brought shall
determine that, despite the adjudication of liability, such person is fairly and
reasonably entitled to indemnity for such expenses which the court shall deem
proper. Section 145 of the General Corporation Law of Delaware further provides
that to the extent a director, officer, employee or agent of the corporation has
been successful in the defense of any action, suit or proceeding referred to
above or in the defense of any claim, issue or matter therein, he or she shall
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith.
Our certificate of incorporation and by-laws require us to indemnify
our directors and officers to the fullest extent permitted by the General
Corporation Law of the State of Delaware.
Item 7. Exemption From Registration Claimed
Persons eligible to receive restricted stock awards or grants of
non-qualified stock options will have an existing relationship with us and will
have access to comprehensive information about us to enable them to make an
informed investment decision. The recipient must express an investment intent
and consent to the imprinting of a legend on the securities restricting their
transferability except in compliance with applicable securities laws. Disease
Sciences claims the exemption from the registration requirements of the
Securities Act under Section 4(2) of the Securities Act.
Item 8. Exhibits
4 Disease Sciences, Inc. 2000 Management and Director Equity Incentive
and Compensation Plan (1)
5 Opinion of Atlas Pearlman, P.A.
23.1 Consent of Feldman Sherb & Co., P.C.
23.2 Consent of Atlas Pearlman, P.A. (included in Exhibit 5)
(1) Incorporated by reference to the Information Statement on Form 14-C filed
with the Securities and Exchange Commission on July 23, 2001.
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Item 9. Undertakings
The Registrant will:
1. File, during any period in which it offers or sells securities,
a post-effective amendment to this registration statement to:
i. Include any prospectus required by section 10(a)(3) of the
Securities Act;
ii. Reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the information in
the registration statement; and notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum offering range may be
reflected in the form of prospects filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in the volume and price represent no
more than a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration statement.
iii. Include any additional or changed material information on
the plan of distribution.
2. For determining liability under the Securities Act, treat each
post-effective amendment as a new registration statement of the securities
offered, and the offering of the securities at that time to be the initial bona
fide offering.
3. File a post-effective amendment to remove from registration any of
the securities that remain unsold at the end of the offering.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Boca Raton and the State of Florida, on the 15th
day of August, 2001.
DISEASE SCIENCES, INC.
By: /s/ Dr. Wayne Goldstein
-------------------------------------
Dr. Wayne Goldstein
Chief Executive Officer and President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ Dr. Wayne Goldstein President, Chief Executive
----------------------- Officer and Director
Dr. Wayne Goldstein August 15, 2001
/s/ Brian S. John Chief Financial Officer,
----------------------- Principal Accounting Officer
Brian S. John and Director August 15, 2001
/s/ Bryant Villeponteau Chief Scientific Officer
-------------------------- and Director
Bryant Villeponteau, Ph.D. August 15, 2001
EXHIBIT INDEX
Exhibit No. Description
5 Opinion of Atlas Pearlman, P.A.
23.1 Consent of Feldman Sherb & Co., P.C.
23.2 Consent of Atlas Pearlman, P.A. (included in Exhibit 5)