Item 5. Other Information.
The Company signed a letter of intent with eSelectives, Inc., a
Delaware corporation, in September, 2000. The consummation of the
transaction contemplated by the letter of intent is subject to approval by
the Company's shareholders. Generally, the letter of intent provides for a
20:1 reverse split of present shareholder stock in connection with a share
for share exchange to acquire eSelectives. eSelectives will pay at least
$50,000 toward expenses and will also satisfy wage claims by payment of
381,000 shares of 10 million shares issued through an SB2 application and
spinout of the present Company operations. The letter of intent includes an
anti-dilution provision for any reverse-splits, mergers, stock for stock
exchanges or other similar transactions for 365 days subsequent to closing
(except for the 20:1 reverse split and the SB2 application for the additional
10 million shares already referenced). $75,000 has already been paid by
eSelectives as required in the letter of intent. Shareholders will receive
a more complete disclosure of all terms and conditions in the proxy mailing,
which has not yet been finalized.
eSelectives has raised an entity status issue, disclosed prior to
signing of the letter of intent, which the Company has hired outside counsel
to resolve. The Company is moving forward to accomplish its obligations
under the agreement, and intends to hold eSelectives to its responsibilities
thereunder as well. |
