CONFIDENTIAL PRIVATE OFFERING MEMORANDUM
Name of Offeree:_______________________________________
Memorandum No.: _________________________________
1,500,000 Shares
RAMSIN PRODUCT DEVELOPMENT, INC.
(a New York corporation)
Common Stock
Ramsin Product Development, Inc., a New York corporation (the "Company"),
hereby offers 1,500,000 shares of its $.000 1 par value common stock (the
"Common Stock") at $0.10 per share (the "Offering") as set forth on the
individualized Subscription Agreement accompanying this
Memorandum sent to the person whose name appears above and on such Subscription
Agreement. "The Offering" is made only to New York residents and non-U.S.
citizens.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS OFFERING MEMORANDUM. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
PRIOR TO THIS OFFERING, THERE HAS BEEN NO PUBLIC MARKET FOR THE
SECURITIES OFFERED HEREBY, AND NO ASSURANCE THAT A PUBLIC MARKET
WILL EXIST FOLLOWING THIS OFFERING. THE SECURITIES OFFERED XXXXXX
INVOLVE A HIGH DEGREE OF RISK AND IMMEDIATE SUBSTANTIAL DILUTION
AND SHOULD NOT BE PURCHASED BY INVESTORS WHO CANNOT AFFORD THE
LOSS OF THEIR ENTIRE INVESTMENT. SEE" RISK FACTORS" BEGINNING ON
PAGE 7.
Net Proceeds
Offering Price (1) Concession (2) to the Company (3)
Per Share $0.10 $0.01 $0.09
Total Offering $150,000.00 $15,000.00 $135,000.00
(1) The offering price of the shares has been unilaterally determined by the
Company and is not based on its assets, book value, or earnings.
(2) This Offering is being made solely through a selling agent or agents. The
Company may pay a 10% selling concession to any selling agent and
expects to engage First American Equities, Inc. as a selling
agent. This offering is
not being made directly by the Company through any of its
directors, officers and
employees.
(3) Before deducting expenses for legal, accounting, printing, and other costs
associated with this Offering estimated to be approximately $16,000.
Any representation or warranty that may be made by anyone other than
conforming to this document is unauthorized and not valid. This Offering
is being made in accordance with an exemption from registration under
Rule 504 of Regulation D promulgated pursuant to the Securities Act.
RAMSIN PRODUCT DEVELOPMENT, INC.
0000 X. Xxxxx Xx., Xxxxx #000
Xxxxxxxxx, Xxx Xxxx 00000
The Date of this Confidential Private Offering Memorandum is July 8, 1997.
FOREWORD
This Confidential Private Offering Memorandum (the "Memorandum") has been
prepared by the management of Ramsin Product Development, Inc.
(the "Company") in conjunction with First American Equities, Inc. for the
purpose of evaluating an investment opportunity. The Company has
prepared the Memorandum from corporate information.
This Memorandum is not all inclusive and does not necessarily contain all
the information that a prospective investor may require in order to make an
investment decision. The contents of the Memorandum are
believed to be reliable;
however, the Company and First American Equities, Inc., disclaim any and all
liability for representations or warranties, expressed or implied, as to the
completeness or accuracy of the information and material contained in the
Memorandum and for any omissions from the Memorandum, as well as
for any other written or oral communication transmitted or made available
in connection with the Offering or this Memorandum.
At the request of the Company, the Memorandum is being submitted to the
recipient on a confidential basis. By the acceptance of the request, the
recipient agrees not to reproduce, disclose, or distribute,
in whole or in part,
the material contained in the document nor any other information
communicated to the recipient unless such information is communicated
to the recipient's associates for the exclusive purpose of evaluating the
investment. If the recipient no longer wishes to pursue the investment
opportunity, please return the Memorandum and any other related material,
including the Subscription Agreement attached as Exhibit A, to the Company.
298760
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE
SECURITIES LAWS OR ANY STATE AND ARE BEING OFFERED AND SOLD IN
RELIANCE UPON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT AND SUCH STATE LAWS. THE SECURITIES MAY NOT BE
RE-OFFERED FOR SALE OR RESOLD OR OTHERWISE TRANSFERRED UNLESS
THEY ARE REGISTERED UNDER THE APPLICABLE PROVISIONS OF THE
SECURITIES ACT AND SUCH STATE LAWS OR ARE EXEMPT FROM SUCH
REGISTRATION.
THESE SECURITIES MAY BE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY
AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS
PERMITTED UNDER THE SECURITIES ACT AND THE APPLICABLE STATE
SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED
TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE
PERIOD OF TIME.
THIS MEMORANDUM DOES NOT CONSTITUTE AN OFFER OR SOLICITATION TO
ANYONE IN ANY STATE OR JURISDICTION IN WHICH SUCH AN OFFER OR
SOLICITATION IS NOT AUTHORIZED. NO REPRODUCTION OR DISTRIBUTION
OF THIS MEMORANDUM IN WHOLE OR IN PART, OR DISCLOSURE OF ANY OF
THE CONTENTS HEREOF, IS PERMITTED, OTHER THAN AS AUTHORIZED IN
WRITING BY THE COMPANY.
IN MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE ISSUER AND THE TERMS OF THE OFFERING, INCLUDING
THE MERITS AND RISKS INVOLVED. PRIOR TO MAKING ANY DECISION TO
PURCHASE SHARES, PROSPECTIVE INVESTORS ARE URGED TO READ
CAREFULLY THIS MEMORANDUM AND, IN PARTICULAR, TO NOTE THE "RISK
FACTORS" SET FORTH HEREIN. AN INVESTOR IS REQUIRED TO REPRESENT
THAT HE HAS READ AND UNDERSTANDS THE CONTENTS OF THIS
MEMORANDUM.
THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR
STATE SECURITIES COMMISSION OR REGULATORY AUTHORITY.
FURTHERMORE, THE FOREGOING AUTHORITIES HAVE NOT CONFIRMED THE
ACCURACY OR DETERMINED THE ADEQUACY OF THIS DOCUMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NO REPRESENTATIONS OR WARRANTIES OF ANY KIND ARE INTENDED OR
SHOULD BE INFERRED WITH RESPECT TO THE ECONOMIC RETURN WHICH
MAY ACCRUE TO A SHAREHOLDER. PROSPECTIVE INVESTORS ARE NOT TO
CONSTRUE THE CONTENTS OF THIS MEMORANDUM AS LEGAL, TAX OR
INVESTMENT ADVICE. EACH INVESTOR SHOULD CONSULT HIS OWN COUNSEL,
ACCOUNTANT AND BUSINESS ADVISER AS TO LEGAL, TAX AND RELATED
MATTERS CONCERNING A PURCHASE BY HIM OF THE SHARES. THE OFFEREE,
298760 -3-
BY ACCEPTING DELIVER OF THIS MEMORANDUM, AGREES TO RETURN THIS
MEMORANDUM AND ALL ENCLOSED DOCUMENTS TO THE COMPANY IF THE
OFFEREE DOES NOT AGREE TO PURCHASE ANY OF THE SHARES.
NEW YORK RESIDENTS
THIS MEMORANDUM HAS NOT BEEN REVIEWED BY THE ATTORNEY GENERAL
PRIOR TO ITS ISSUANCE AND USE. THE ATFORNEY GENERAL OF THE STATE
OF NEW YORK HAS NOT PASSED ON OR ENDORSED THE MERITS OF THIS
OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
298760
SPECIAL CHARACTERISTICS OF THE RULE 504
SMALL BUSINESS ISSUER OFFERING
Pursuant to Section 3(b) of the Securities Act of 1933, as amended (the
"Act"), the United States Securities and Exchange Commission
(the "Commission") is empowered by Congress to prescribe the
rules and regulations and amend existing regulations to facilitate the raising
of capital by small business issuers and reduce the cost of compliance
with federal securities laws. These amendments were described in
a release issued by the Commission to be part of what was described as "
small business initiatives".
As part of these small business initiatives, effective August 13, 1992,
Rule 504 of Regulation D, which was promulgated under the Act, was
amended to provide that companies not required to file periodic
reports with the Commission pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 were permitted to sell up to
$1,000,000 of securities in a 12 month period, without registration pursuant
the Act. No specific disclosure document was prescribed for this limited
offering of securities and there is no federal proscription or limitation
against general solicitation of investors, although the
various state securities
laws may impose such proscription of limitation.
The Commission defines a small business issuer as a company
with annual revenues of less than $25,000,000 and voting stock with
a public float of less than $25,000,000. The Commission also
made it clear that lower priced offerings by a legitimate small business
issuers would be the main beneficiaries of the revised exemptions
and that, in its view, there were adequate safeguards. governing the
over-the-counter market to counter marketing abuses that had arisen in
the past with respect to what are commonly referred to as "xxxxx stock"
(see "Risk Factors - Limitations Upon Trading Activities: Restrictions
Imposed Upon Broker/Dealers").
As with all offerings of securities, however, revised Rule 504 is
not a haven from the anti-fraud provisions of the federal securities laws.
Any offering made by a legitimate small business issuer must still provide
potential investors with sufficient information to make an informed
investment decision and comport with the requirement to reveal, albeit in
more summary form than previously, any material information concerning
the potential risks of the investment. Moreover, Rule 504 does not eliminate
the need for an issuer to comply with state securities laws and regulations.
OFFERING MADE IN RELIANCE UPON RULE 504 OF REGULATION D
This Offering is made in reliance upon Rule 504 of Regulation D,
which provides an exemption for limited offerings and sales of securities
not exceeding $1,000,000. To qualify for the exemption under Rule 504, offers
and sales must satisfy the terms and conditions of Rules 501 and 502 of
Regulation D, except as otherwise provided in Rule 504.
In reliance upon Rule 504, an issuer is no longer required to provide a
prospective purchaser with any written memorandum, prospectus or other
information, which allows an investor the opportunity to determine the
advisability of the investment. Nevertheless, the Company has
-5-
voluntary chosen to prepare this Offering Memorandum to permit prospective
purchasers to evaluate the offered investment in the Company.
Normally, Rule 502(c) restricts the offer or sale of the securities by any form
of general solicitation or general advertising, including any advertisement,
article, notice or other communication published in any newspaper, magazine or
similar media or broadcast over television or radio and any seminar or meeting
whose attendees have been invited by general solicitation
or general advertising.
This does not apply to an offering made pursuant to Rule 504.
Previously, Rule 5 02(d) imposed certain limitations on the resale of all
securities sold pursuant to Regulation D and required issuers to exercise
reasonable care, including the placement of an appropriate restrictive legend
on the certificates evidencing the securities, to assure that purchasers of
the securities are not "underwriters" within the meaning of Section 2(a)( 11) of
the Act. Those resale limitations and reasonable care requirements do not apply
to an offering made pursuant to Rule 504, which is deemed to be a public
offering for purposes of the Act, although applicable state securities laws
may impose similar limitations and requirements. Nonetheless, such a legend
restricting the transfer of Shares will be placed on all certificates.
Finally, Rule 501(e) contains a limitation regarding the number of
non-accredited investors, restricting those investors to a maximum
of thirty-five (35) in the purchase of securities in reliance
upon Regulation D.
This limitation does not apply to an offering made pursuant to Rule 504.
FOR NEW YORK RESIDENTS ONLY:
THIS OFFERING MEMORANDUM HAS NOT BEEN REVIEWED BY THE ATTORNEY
GENERAL OF THE STATE OF NEW YORK PRIOR TO ITS ISSUANCE AND USE.
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON
OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO
THE CONTRARY IS UNLAWFUL.
Summary
The following is a summary of the Company, the principal terms of the Offering,
and certain other matters and is qualified in its entirety by the Company's
financial statements and the more detailed information included elsewhere in
this Memorandum.
The Company
Ramsin, Inc. was started in 1995 by two men having previously gained national
recognition for their entrepreneurial accomplishments. In 1995, a decision
was made to consolidate their talents, utilizing their existing
customer network and
product base, to design a vertically-integrated U.S. firm structured
to develop, market
or license exciting new products in an honest and highly profitable manner.
298760 -6-
Risk Factors
Purchasing shares of the Common Stock ("Shares") involves certain risks. Prior
to deciding whether to invest in Shares, each prospective investor should
consider all of the information contained in this Memorandum,
especially the matters
described in the section entitled "Risk Factors," which sets forth,
among other matters, risks associated with the Company, cash flow needs,
its ability to obtain additional financing and substantial dilution from the
offering price.
Use of Proceeds
The net proceeds of this Offering to the Company will be approximately
$119,000. The Company intends to use $10,000 for product inventory,
$16,000 to set up four satellite offices in the Northeastern
United States, $50,000
to acquire a patent(s), and $43,000 on working capital.
RISK FACTORS
THE PURCHASE OF THE SHARES SUBJECTS THE PROSPECTIVE INVESTOR TO
A NUMBER OF MATERIAL RISKS, INCLUDING BUT NOT LIMITED TO THOSE SET
FORTH BELOW. THE PROSPECTIVE INVESTOR SHOULD CAREFULLY CONSIDER
THE FOLLOWING RISK FACTORS, TOGETHER WITH OTHER INFORMATION
APPEARING ELSEWHERE IN THIS MEMORANDUM IN LIGHT OF SUCH
PROSPECTIVE INVESTOR'S PARTICULAR FINANCIAL CIRCUMSTANCES,
INVESTMENT OBJECTIVES, AND KNOWLEDGE AND EXPERIENCE IN FINANCIAL
AND BUSINESS MATTERS.
Dependence on Future Financing. Even if this Offering if fully subscribed,
the Company will require additional financing for its locations
in other cities,
operations and working capital. There is no assurance that
additional funds will be
available from any source, and if not available, the Company
may not be able to
develop its proposed business in the manner described herein,
in which case or in
other events, investors may lose their entire investment.
The proceeds of this Offering
are expected to be sufficient for the Company to remain
operational for the near future.
Additional financing may come in the form of a second Rule 504
Offering of any or all of
the Common Stock, Common Stock with warrants attached,
and Preferred Stock or other
sale of shares, exempt or non-exempt. If additional shares
or other or additional securities
are issued to obtain financing, investors in this Offering would
suffer a dilutive effect on
their percentage of equity ownership in the Company, however
the book value of their shares
should not be diluted, provided the net proceeds to the
Company from the sale of the
securities is greater, on a per share basis, than that paid
by investors in this Offering.
Management does not anticipate that subsequent offerings
will dilute the book value
of its Common Stock.
Dependence on Key Personnel. The Company will be highly dependent on the
ability and efforts of management and staff personnel of the Company to
manage the daily operations of the Company. No person should purchase any
shares offered hereby unless such investor is willing to
entrust all aspects of the
management of the Company to the President, the Company's Directors and the
Company's executive officers. The Company does not have an employment agreement
with anyone, but rather each employee (including key personnel)
is an employee-at
298760 -7-
will who may terminate his employment, or be terminated, at any time and for
any reason or no reason.
No Ownership in Product. The only product currently being marketed and sold
by the Company is the Closer, No-Spill Lid (the "Product"). The patent to
the Product is owned by Ram Products, Inc. and the right to sell
the Product has
been licensed to Radio Cap Company, Inc. ("Radio Cap"). The Company has an
exclusive license to act as Radio Cap's agent for selling the
Product in the United
States to children's markets and to hospital and medical
distributors of medical
products. The license does not prohibit or allow the Company
to market and sell
the Product in other geographic or demographic markets. Accordingly, to the
extent it sells the Product to (and/or has marketing agreements with) companies
outside the licensed markets, the Company may be in violation of its License
Agreement and may have or incur liabilities in connection therewith. Radio Cap
may grant or may already have granted licenses to others to sell the Product in
all other markets. The Company's license agreement had an initial term of one
year ending May 30, 1997 and automatically renews for successive one-year
periods, provided it is not first terminated by either party 60 days
prior to the
end of the then-current term. Since neither party elected to terminate, the
Agreement is in its second term. Nonetheless, Radio Cap could cause
the termination of the License Agreement in any year and thereby cut off the
Company's supply of and right to sell the Product in other markets.
In addition,
to the extent Radio Cap in the future loses its right to sell the
Product, so too
shall the Company lose its rights.
No Independent Studies. The determination of the Company's capital requirements
and the estimated use of proceeds from the Offering is based solely upon
information developed by the. Company. No independent studies with regard to
feasibility, management, or marketing have been conducted by any third
parties in
determining the Company's capital requirements.
Dilution. Following the completion of this Offering, investors will experience
immediate and substantial dilution of their investment. Accordingly, prospective
investors may bear a substantial portion of the risk of loss while
control of the
Company remains in the hands of the present shareholders. See "Dilution."
Arbitrary Offering Price. The Company's management arbitrarily determined
the sales price for the Shares offered hereby. The offering price is not based
on the Company's assets, book value, or earnings. Accordingly,
the offering price
should not be considered as an indication of the actual fair
market value of the
Common Stock.
Control of Company by Management. The current management controls more than
two-thirds of the Company's Common Stock and will control more than
two-thirds, even if the Offering is fully subscribed. Therefore, under the
Company's By-Laws and New York State laws, they are in the position to
elect all of the Company's Directors. The Company's Directors,
in turn, elect
all of the Company's executive officers. Accordingly, management
will be able to,
directly or indirectly, control all of the affairs of the Company.
It is possible that the
interests of a potential investor will not be the same as those of management.
No Assurance of a Public Market. There is no trading market for the Common
Stock, and no assurances can be given that a trading market will develop,
or if developed, will continue. If no market develops, it may be difficult
or impossible
for holders of shares of Common Stock to sell their shares.
Unlikelihood of Dividends and Dividend and Redemption Restrictions. New
York State law prohibits the Company from paying any dividends, making
any other distributions in cash or property, or redeeming any
of its capital stock if
the Company does not have retained earnings or capital surplus equal to the
amount of the proposed dividend or redemption payment. Because of these
restrictions, there are no assurances that the Company will be able to pay
any dividends. The Company intends to retain earnings and capital surplus,
if any, for the foreseeable future to fund the development and growth of the
business.
Limitations Upon Trading Activities: Restrictions Imposed Upon Broker/Dealers.
The Sale of the Company's securities pursuant to this offering and any trading
of the Company's securities thereafter (in the event any such
trading takes place)
may be subject to material limitations due to
Rule I 5g-9 of the Securities and
Exchange Commission.
Rule 1 5g-9 restricts the solicitation of sales of "xxxxx stocks" by
brokers/dealers to persons other than established customers
and accredited investors (generally institutions with assets in excess
of $5,000,000 or individuals with a net worth in excess of $1,000,000 or
annual income exceeding $200,000 or $300,000 jointly with their spouse).
Pursuant to Rule I 5g-9, prior to any sale of a "xxxxx stock," the
broker/dealer must have forth certain personal information concerning
the person's. financial first received a written statement from the
purchaser of the securities setting situation, investment experience
and investment objectives. Thereafter, the broker/dealer must reasonably
determine, based upon the information provided, that the purchase is
suitable for the person and that the person (or the person's independent
adviser in the transaction) has sufficient knowledge and experience in
financial matters that the person (or adviser) reasonably may be expected
to be capable of evaluating the risks of transactions in "xxxxx stocks."
"Xxxxx stocks" are defined as any equity security other than (i) a security
that is registered on a national exchange or included for quotation in
the NASDAQ system, or (ii) a security whose issuer has net tangible assets in
excess of $2,000,000 or average revenue of at least
$6,000,000 for the last three
years. Securities are exempt from Rule 1 5g-9 if the price of
the security is at least $5.00.
Since the Company's securities do not presently qualify for inclusion on a
national exchange or in the NASDAQ system and for so long as the Company
has net tangible assets of $2,000,000 or less and revenue
of less than $6,000,000 for
each of the three prior years, or the price of its securities
is less than $5.00, the
Company's securities presently, and will likely for the
foreseeable future, constitute
"xxxxx stocks" and be subject to Rule I 5g-9.
Rules 1 5g-2 through 1 5g-6 of the Securities and Exchange Commission provide
a series of additional rules requiring broker/dealers engaging in transactions
in "xxxxx stocks" to first provide to their customers a series
of disclosures and
documents, including: (i) a standardized risk disclosure document identifying
the risks inherent in investing in "xxxxx stocks;"
(ii) all compensation received
by the broker/dealer in connection with the transaction; (iii) current
298760 -9-
quotation prices and other relevant market data (if any); and (iv) monthly
account statements reflecting the fair market value of the securities.
As a result of the foregoing, sales of Shares in this offering and any trading
of the Company's securities thereafter will be more difficult than
in the case of securities not defined as "xxxxx stocks." In addition, the
market for the Company's securities may be depressed (should any
such market develop) and an investor may find it difficult to sell the
Company's securities.
TERMS OF THE OFFERING
Total Offering: $150,000.00.
Type of Offering: Regulation D, Rule 504.
Shares Offered: The Company is Offering 1,500,000 shares of
Common Stock. The Company is authorized to issue 50,000,000 shares
of $.0001 par value common stock, of which 6,000,000 are currently issued
and outstanding. (See also "Capitalization.")
Price Per Share: $0.10 per share.
No Minimum Purchase: There is no minimum purchase requirement, however,
the Company reserves the right to accept or reject any
subscription, in whole or in part.
Termination: The Company reserves the right to terminate this Offering
(which date shall be referred to as the "Termination Date") without notice at
any time prior to the sale of all 1,500,000 shares of Common Stock offered
hereby. Any Subscription Agreements received by the Company after that time,
or any incomplete or defective Subscription Agreements
received before that time,
will not be accepted and the Company will be the sole judge of the adequacy
of any subscription.
No Market for Common Stock: The shares of Common Stock offered
hereby are offered in reliance upon Rule 504 of Regulation D, which provides
for an exemption from registration under the Act. The potential investor should
be aware that no market for the Common Stock of the Company presently exists
and there can be no assurance that a market will materialize upon completion
of this Offering or at any time in the future.
Subscription Procedure/Representations: Any offeree who wishes to
purchase Shares must submit to the Company, prior to the Termination Date
(1) one originally executed and completed Subscription Agreement in the form
attached to this Memorandum as Exhibit A, together with (2) Subscriber's check
or bank draft payable to "RAMSIN PRODUCT DEVELOPMENT, INC."
By executing the Subscription Agreement, the offeree will represent, among
other things, that (a) he is acquiring the Shares being purchased by him for
his own account as principal, for investment purposes only and not with a view
to resale or distribution; and (b) he is a person who
is able to bear the economic
risk of the investment.
298760 -10-
These representations notwithstanding, the Company has the right BUT NOT
HE OBLIGATION to make an independent assessment of the suitability
of an investment for a particular investor, and on the basis
of that assessment,
to refuse to permit such potential investment to purchase Shares.
USE OF PROCEEDS
Net proceeds, if the maximum number of Shares in this Offering is sold, are
estimated to be $135,000. Approximately $16,000 of such proceeds will be used
to pay legal, accounting, printing and advertising
expenses of this Offering. The
balance of the proceeds, in the approximate amount of $119,000, will be used
as follows: $10,000 for the purchase of product inventory,
$16,000 to set up four
satellite offices in the Northeastern United States,
acquisition of two patents
for $50,000, and $43,000 on working capital.
DILUTION
The Company is authorized to issue 50,000,000 shares of common stock and, as
of May 30, 1997, there were 6,000,000 shares of Common Stock issued and
outstanding. As of that date, the net tangible book value per share of Common
Stock was $0.0 192.
"Dilution" represents the difference between the offering price of the Common
Stock and the net tangible book value per share of Common Stock immediately
after the completion of the Offering. "Net Tangible Book Value" is the
amount that results
from subtracting the total liabilities of the Company from its
total tangible assets.
Assuming all the shares offered in this Offering are sold,
and giving effect to the
receipt of the net proceeds of this Offering, the projected
net tangible book value of
the Common Stock would be ($249,800) or $0.0333 per share. Therefore the
purchasers of the Common Stock will suffer an immediate
dilution of approximately
$0.0667 per share while the present stockholders of the Company will receive
immediate increase of $0.0 140 per share in the net tangible book value of the
Common Stock held by them.
The following table illustrates the dilution to the purchasers
of the Common Stock.
Offering Price of Stock $0.10
Net Tangible Book Value before Offering $0.0192
Increase attributable to sale of Common Stock $0.0 140
Net Tangible Book Value after Offering $0.0333
Per share dilution to Purchaser $0.0667
RESTRICTIONS ON TRANSFER
The Company is using Rule 504 of Regulation D as the federal exemption from
registration as it relates to the Common Stock. Pursuant to this exemption,
the Common Stock would not be deemed "restricted securities" as defined in
Rule 144 under the Act. Notwithstanding this federal securities exemption, the
resale of the Common Stock, nonetheless, will be subject to the
respective state securities law requirements in the governing jurisdictions,
which impose restrictions on the resale of the securities
(including placing a legend on the certificate). In such
event, a purchaser of the
Common Stock will be subject to the requirements governing resale in such
states, which may restrict or otherwise prohibit the resale of the Common Stock.
BUSINESS OF THE COMPANY
Ramsin Product Development, Inc. was formed on February 23, 1995 as a New York
corporation under the name Ramsin Inc., for the primary purpose of discovering,
developing, and marketing new inventions.
The founder of the Company are inventors themselves. Through Ram Products, Inc.
("Ram Products"), Xxxxxxx Xxxxxx actively pursued the development and
marketing of the first of several Ram Products patents,
that being the patent for
The Closer, No-Spill Lid (the "Product"), which is a uniquely
designed lid for travel
mugs. To do so, he had leveraged assets, traveled to
several trade shows to research
the market, licensed the Product with a national manufacturer
and began successfully
marketing it. Xxxxxxx Xxxxxxxx'x professional experience
includes many different
areas in the marketing and retail industry. In 1990,
he engaged in direct response
marketing, specializing in 1-800 telephone number campaigns for various
products, and produced several video projects including The Lanne Today
television show starring Xxxxxx Xxxxxxxx (of the Xxxxxxxx Sisters) and actress
Xxx Xxxxxxxxxx, managing all facets of specified projects. Areas include:
product development, television production (including executive producer,
supervising script writing, directing, and editing), as well as media air time
scheduling. He was involved in direct response retail
outlets in the regional malls
of Rochester, New York and Seattle, Washington.
By the beginning of 1996, the Product had been incorporated with it's own
specially designed travel mug. Ram Products had licensed the Product to
Radio Cap, Inc. ("Radio Cap"), a subsidiary of Xxxxxxx
Promotional Products, Inc.
("Xxxxxxx"), which is the largest premium promotional supplier
in the United States.
In turn, Radio Cap granted the Company the exclusive license
to sell the Product
in the United States to children's markets and to hospital and
medical distributors
of medical products. The inclusion of Radio Cap's extensive sales network,
possibly in connection with that of Xxxxxxx or Norwood's other subsidiaries,
produced a dramatic increase in sales by the Company and other sellers of the
Product and a corresponding increase in consumer exposure to the
Product. National
and regional companies such as Brookstone, Sugarcreek, Village Mart, Rochester
Democrat & Chronicle, Delta Sonic, Travel Post, Xxxxx Xxxxxx Home
and Garden,
Wal-Mart, Xxxx Xxxxx, A-Plus Mini Marts, Xxxxxxxx'x Bagel Bakery,
and Travelport
are a few of the outlets presently offering the Traveler w/Closer Lid.
.The Company
currently holds marketing agreements with the first eight of
those companies and
more, and is working in conjunction with McDonald's
restaurant's marketing division
to develop a line of marketable mugs.
Xxxxxxx is publicly held, with its stock listed through the National
Association of Securities Dealers Automated Quotation System ("NASDAQ")
as NPPI. It has 16 different companies within it's corporations, one of which is
Radio Cap. Thus, its involvement through Radio Cap may have or might open
up the opportunity for existing and future products, developed by the Company,
to be included within marketing systems already in place.
298760 -12-
While the Traveler w/Closer Lid was being marketed and sold, the Company's
founders developed another product. It is the Pocket Pal Key Chain,
incorporating six major features used on a daily basis, and the founders plan
to submit a federal patent application soon. This product has widespread appeal
in the premium promotional market and is expected to be released for marketing
and sale through the Company in the fall of 1997.
As development through marketing of these products was taking place, the
Company was receiving requests from several inventors for help with their
own inventions. It became evident that the right combination of expertise and
experience, if available, could be developed into a very profitable business.
With very little yellow page advertising to date, the company is receiving
daily requests, for help from inventors. Thus they have realized the need
to raise capital to provide the very best service to their market.
An experienced management team and Board of Directors have been established
to structure the Company. Company goals and procedures have been laid
out and are presently being implemented.
As the new search begins for capital expansion money, the Company's management
is ready to hit the ground running. All team members have been part of
structuring the operating schematics of this unique, much needed, and
profit-minded company.
MANAGEMENT
Xxxxxxx Xxxxxxxx, President
Xxxxxxx Xxxxxx, Chief Executive Officer
Xxxxxx Xxxxxxx, Vice President of Products
Xxxxx Xxxxxx, Vice President of Operations
Xxxxx Xxxx, Secretary
The following is a brief description of the business background of the
officers of the Company.
Xxxxxxx Xxxxxx, Chief Executive Officer of Ramsin Product Development,
Inc., brings the design expertise to the Company. Xx. Xxxxxx is the inventor of
innovative products, including The Closer, No-Spill Lid, the Keytag, as well as
other up and coming products. Xx. Xxxxxx also brings to the
Company experience
in several levels of sales for these products.
Prior to Ramsin Product Development, Inc., Xx. Xxxxxx spent several years
developing and marketing The Closer, No-Spill Lid, through Ram Products, Inc.
298760 -13-
Xxxxxxx Xxxxxxxx, President of Ramsin Product Development, Inc., is recognized
in the patent development and product marketing industry. Xx. Xxxxxxxx was
previously vice president of Danson Superstores, a direct
response retail outlet,
with locations in Rochester, New York and Seattle, Washington.
That position has
aligned him with developers, designers, patent attorneys and
marketing firms across the United States.
Xxxxxx Xxxxxxx, Vice President of Operations brings to the Company extensive
experience on several levels of sales, managerial and
administrative responsibility
in public and private business sectors. As New York State
Deputy Secretary of State,
Xx. Xxxxxxx served residents of New York State in activities
involving real estate,
corporation licensing, the uniform commercial code, professional licensing, and
state and local public service. As owner, operator and president of
Xxxxxx X. Xxxxxxx, Inc., he directed complete operations of a major general
contracting firm. Xx. Xxxxxxx has also formed several subsidiary corporations
for the acquisition and development of real property.
Xxxxx Xxxxxx, Vice President of Products, brings over 18 years of experience
in both tangible and intangible sales and management experience. Xx. Xxxxxx
also brings to the Company unique marketing skills along with many
years of product
development and marketing experience.
Xxxxx Xxxx, Administrative Assistant/Secretary, is currently administrative
assistant and secretary of the Company.
PRINCIPAL SHAREHOLDERS
The following table sets forth certain information regarding the ownership of
the Common Stock as of the date of this offering Memorandum by (i) each
person who is the beneficial owner of more than 5% of the outstanding shares
of Common Stock, and (ii) each of the Company's directors and
executive officers,
and (iii) all of the Company's directors and executive officers as a group.
Name Common Stock % Before Offering % After Offering(1)
Xxxxxxx Xxxxxx 3,000,000 50% 40%
Xxxxxxx Xxxxxxxx 3,000,000 50% 40%
All Directors and 6,000,000 100% 80%
the Executive Officers
as a. Group
(1) Assumes the sale of 1,500,000 shares.
Shares Eligible for Future Sale
All of the 6,000,000 shares of Common Stock which were issued to Messrs. Xxxxxx
and Xxxxxxxx prior to this Offering, were issued in reliance on an
exemption under
the Act. Such shares will not be available for sale in the open market
without registration
except in reliance upon Rule 144
298760 -14-
under the Act. In general, under Rule 144 a person (or persons whose shares
are aggregated) who has beneficially owned shares acquired in a non-public
transaction for at least one year, including persons who may be
deemed "affiliates"
of the Company, as that term is defined under the Act, would be
entitled to sell, within
any three month period, a number of shares that does not exceed the greater
of 1% of the then outstanding shares of Common Stock, or the average weekly
reported trading volume in the Common Stock on all national securities exchanges
and/or through the NASDAQ during the four calendar weeks preceding such sale,
provided that certain current public information is then available.
Resales by such
beneficial holders may be made in unlimited quantities after two years.
Accordingly, in May 1999, all of the shares of Common Stock acquired by
Messrs. Xxxxxx and Xxxxxxxx may be eligible for public sale under Rule 144
subject to the forgoing restrictions. If a substantial number of
shares owned by
Messrs. Xxxxxx and Xxxxxxxx were sold pursuant to Rule 144
or a registered
offering, the market price of the Common Stock could be adversely affected.
In addition, they may be removed from the board and as officers and may
be terminated as employees.
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
May 20, 1997, and as adjusted, to give effect to the full subscription of
this Offering. This table should be read in conjunction with the Company's
financial statements and footnotes thereto included elsewhere in this
Offering Memorandum.
As
Actual Adjusted
Stockholders' Equity
Preferred Stock, Par Value $.000l
20,000,000 shares authorized; none issued
Common Stock, Par Value $.000l
50,000,000 shares authorized
6,000,000 issued and outstanding
7,500,000 issued and outstanding .
as adjusted 600 750
Additional Paid-in Capital 40,000 159,000
Total Stockholders' Equity 40,600 159,750
Long-Term Debt 40,000 40,000
Total Stockholders' Equity and Long-term Debt $80,600 $199,750
298760 -15-
DESCRIPTION OF SECURITIES
Common Stock
The Company is authorized to issue 50,000,000 shares of common stock,
$.0001
par value per share (the "Common Stock"). There are currently 6,000,000
shares of Common Stock issued and outstanding. None are held in treasury.
Subject to any superior rights of any outstanding preferred stock of the
Company as set forth in the Company's By-Laws or certificate
of incorporation, the holders of Common Stock (i) have equal rights to
dividends from funds legally available therefore, when, as and if declared
by the board of Directors of the Company; (ii) are entitled to share ratably in
all of the assets, of the Company available for distribution to holders of the
Common Stock upon liquidation, dissolution or winding up affairs of the
Company; (iii) do not have preemptive, subscription or conversion rights and
there are no redemption or sinking fund provisions applicable thereto; and
(iv) are entitled to one non-cumulative vote per share on all matters on
which stockholders may vote at meetings of shareholders at which a
quorum is present. All of the shares of Common Stock now outstanding
are fully paid and non-assessable and all shares of Common Stock
which are the subject of this Offering, when issued, will be fully paid and
non-assessable. Holders of Common Stock of the Company do not have
cumulative voting rights, which means that the holders of a majority of such
outstanding shares, voting for the election of directors, can elect all of the
directors to be elected by the holders of the Common Stock if they so chose
and, in such event, the holders of the remaining shares
will not be able to elect
any of the Company's directors.
Preferred Stock
The Company is authorized to issue 20,000,000 shares of preferred stock,
$0.000 1 par value per share (the "Preferred Stock"). The Preferred Stock may
be issued from time to time in one or more classes or series, each class or
series of which shall have the designations, relative rights, preferences,
and limitations as fixed by resolution of the Company's Board of Directors.
Among other things, the Preferred Stock may rank senior to the Common Stock
as to dividend rights, liquidation preferences, or both, and
may have extraordinary
or limited voting rights. There are currently no shares issued,
outstanding, or held
in treasury.
PLAN OF DISTRIBUTION
1,500,000 shares of the Company's Common Stock are being offered at a price
of $0.10 per share. The Company reserves the right to accept or reject
any subscription, in whole or part. The Company has reserved the
right to terminate
this Offering at any time. The Company plans to engage
First American Equities, Inc.
as a selling agent, and may engaged other or additional selling
agents, to offer
the Shares for sale and the Company may pay a 10% selling concession to such
selling agent(s) and its or their expenses associated therewith.
298760 -16-
STOCK TRANSFER AGENT
The Company has not yet chosen a transfer agent.
ADDITIONAL INFORMATION
Should any potential investor or his purchaser representative desire any
additional information regarding the Company or wish to review any of
the underlying documents referred to herein, they may do so by requesting
such material from Xx. Xxxxxxx Xxxxxxxx, President, Ramsin Product
Development, Inc., 0000 X. Xxxxx Xx., Xxxxx 000, Xxxxxxxxx, Xxx Xxxx 00000.
The phone number is (000) 000-0000.
298760 -17-
