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Our exclusive Partner Program is a unique method of title acquisition among
Internet publishers. The program allows qualified publishers to post books
online free of charge and receive revenue share. The program is available to
publishers, agents, packagers or other persons or organizations who have the
copyright to book titles. Qualified Partners will be able to post books online
for free and receive multiple new revenue streams. The program is available to
publishers, agents, packagers or other persons or entities who have the
copyright to multiple book titles.
A value-added feature of the Kanakaris system is real time secure fulfillment
of orders from customers. When an order for a print copy is submitted, the
purchaser is given immediate access to the online version while the book is
shipped. The online protection of the author's intellectual property and the
enhanced reading format differentiates Kanakaris from any other Internet
distributor.
Online Movies
We feature online Movies Of The Week featuring no download time and no plug-in
required. To do so, we use proprietary technology with a security feature
developed for Kanakaris by GEO Interactive. Kanakaris has amassed a catalog of
film titles for online distribution. Kanakaris plans to offer pay-per-view
movies as well as sell advertising to its website.
Online Music
Cyberpop will be the KKRS.Net downloadable music site offering a combination of
24-hour Internet radio exposure to artists combined with direct online sale of
songs and albums in a choice of the leading Internet delivery technologies.
Online Shopping/Entertainment
ILSN, the Internet LifeStyle Network, will be the first
entertainment/shopping channel on the Internet. It will be fully integrated
with our downloadable book, music and movie Web sites.
Desience Division
We seek to revitalize and grow our Desience division. Our OPCON Module
System, a proprietary modular data control console system for high-end
computer command centers has been utilized by clients such as NASA, the
Federal Bureau of Investigation, the U.S. Navy, Bank of America, Mitsubishi,
Pacfic Bell and other Fortune 500 companies and governmental agencies. We
seek to increase its independent sales force, update its promotional
materials, and update and expand its product line.
The division began business in 1972 designing and manufacturing trading desks
for the burgeoning investment industry. By 1984 Desience clients requested
similar equipment "enclosures" for their expanding computer centers.
Working with IBM, Desience developed the OPCON modular system for enclosing
and organizing the equipment and cabling associated with data and network
control centers. OPCON was built to exacting standards using steel and
aluminum construction for strength, durability and fire retardency. The first
large OPCON installation occurred in 1985, an installation of over 75 modules
at du Pont de Nemours in Wilmington, Delaware.
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Desience has been marketing and selling the OPCON modular system to corporate
and government mainframe computer users since the early 1980's when mainframe
computer use was growing dramatically. While 90% of Desience's sales have
been in the United States, the 1990's have seen increased business from South
America including multiple orders from Venezuela and Mexico. Desience has
also sold and installed OPCON in Canada, Barbados, Bermuda, St. Lucia,
Kuwait, and Guam. Desience assists the client in the planning process by
making site visits, taking lists of requirements, then providing customers
with blueprint floor plans of OPCON layouts, elevated views of suggested
equipment layouts and perspective presentation drawings. Additionally,
Desience oversees manufacturing of product and oversees the installation
processes.
In 1999, Desience announced plans to develop a "personal" module system,
tentatively titled Opcon 2000, to provide a single computer work station for
home or office. This product will represent the first consumer product offering
in the our history. It will be marketed over the internet and consumer retail
distribution will be pursued.
Currently there exists five manufacturers compete in the marketplace for
modular system solutions. They are divided between "wood-type" products and
metal products. Most competitors offer somewhat similar services
(installation, warranties, customer service). Deciding factors such as price,
service, features, etc. vary according to the requirements of the customer.
THE OFFERING
Our Shares will be offered as a shelf registration under Securities Act Rule
415 at $0.__ per Share. See "Plan of Distribution." The purchaser of our
convertible debenture will be permitted to convert the debenture into common
stock covered by this Prospectus. See "Plan of Distribution." If all the
Shares offered are transferred under the debenture this will represent the
net proceeds from sale of the debenture of a maximum of $______________ less
certain costs associated with this Offering. See "Use of Proceeds." The
proceeds, to the extent they have already been received by us, have been
utilized as working capital for us.
LIQUIDITY OF INVESTMENT
Although the Shares registered pursuant to this SB-2 registration statement
will be unrestricted and our common stock currently trades on the NASDAQ OTC
Bulletin Board, the Shares available for public resale is limited. Therefore,
an investor may not be able to easily sell or transfer the Shares. Investors
should be able to bear the risk of the investment in the Shares for an
indefinite period of time. See "Risk Factors."
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DESCRIPTION OF PROPERTY
We own no real property and leases the office space used as our principal
offices.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
(a) Market Information.
Our Shares are traded in the over-the-counter market and the range of closing
bid prices shown below is as reported by the OTC Bulletin Board. The
quotations shown reflect inter-dealer prices, without retail mark-up,
mark-down or commission and may not necessarily represent actual transactions.
Quarterly Stock Prices
The following are the closing prices on our stock on the last day of each
quarter for the last year (June 1998 - June 1999):
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June 30, 1998 $0.53
September 30, 1998 $0.0625
December 31, 1998 $0.18
March 31, 1999 $2.0625
June 30, 1999 $1.1875
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During this time period the closing price of our stock has fluctuated from the
following approximate minimum to maximum range: $0.04 to $3.00.
(b) Dividends
We have not previously declared or paid a cash dividend to stockholders.
The Board of Directors presently intends to retain any earnings to finance our
operations and does not expect to authorize cash dividends in the foreseeable
future. Any payment of cash dividends in the future will depend upon our
earnings, capital requirements and other factors.
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EXECUTIVE COMPENSATION
(a) Mr. Kanakaris, as our Chief Executive Officer, shall receive $105,000 per
year, plus normal perks and benefits such as insurance, sick leave, paid
vacation days, etc. Mr. Lotspeich, as President of the Desience Division and
Technology, shall receive $105,000 per year, plus normal perks and benefits
such as insurance, sick leave, paid vacation days, etc. John McKay, Director
and Web Master shall receive $80,000 per year, plus normal perks and benefits
such as insurance, sick leave, paid vacation days, etc.
(b) There are no annuity, pension or retirement benefits proposed to be paid
to officers, directors, or employees of the corporation in the event of
retirement at normal retirement date pursuant to any presently existing plan
provided or contributed to by the corporation or any of its subsidiaries.
(c) Our Management has implemented a stock option plan dated January 1999 in
order to compensate existing management and employees as well as to help
recruit qualified personnel in the highly competitive internet industry
within which we compete.
See plan as per Barnett
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FINANCIAL STATEMENTS
KANAKARIS COMMUNICATIONS, INC.
AND SUBSIDIARY
CONSOLIDATED FINANCIAL STATEMENTS
AS OF MARCH 31, 1999 |
