Brian G. Larson, Larry J. Davis, and Dan J. Johnson, three of the Selling
Shareholders who are offering an aggregate of 175,000 shares of Common Stock,
are directors and officers of the Company. Mr. Larson and Mr. Davis are also
the original founders of the Company. The shares held by Mr. Larson and Mr.
Davis have not previously been registered, but have been held for a sufficient
period that they would be eligible for sale under the exemption from
registration set forth in Rule 144 adopted under the Securities Act. The shares
to be offered by Mr. Johnson will be issued on the exercise of a portion of the
Employee Options held by Mr. Johnson. These shares will be issued pursuant to a
registration statement on Form S-8 and, as such, will not be restricted
securities. However, as a result of his status with the Company, Mr. Johnson
would be obligated to comply with Rule 144 or some other exemption from the
registration requirements of the Securities Act in order to currently sell his
shares in the absence of the Registration Statement of which this Prospectus
forms a part. Additional information concerning the relationship between the
Company and these individuals is included in the Company's transition report on
Form 10-K for the six months ended December 31, 1996, and annual report on Form
10-KSB for the year ended June 30, 1996, and will be updated from time to time
in the periodic reports of the Company filed with the Securities and Exchange
Commission.
<TABLE>
<CAPTION>
Now Owned After Offering
---------------------- Securities -----------------------
Selling Shareholders Number Percent(1) To Be Sold(2) Number Percent(3)
- ------------------------- --------- ---------- ------------- --------- ----------
<S> <C> <C> <C> <C> <C>
Brian G. Larson
Common Stock 391,083 3.4% 75,000 316,083 2.1%
Employee Options 750,000 6.2% 0 750,000 4.8%
--------- ------ ---------
Total 1,141,083 9.4% 75,000 1,066,083 6.9%
Larry J. Davis
Common Stock 774,454 6.8% 50,000 724,454 4.9%
Employee Options 750,000 6.2% 0 750,000 4.8%
--------- ------ ---------
Total 1,524,454 12.5% 50,000 1,474,454 9.5%
Dan J. Johnson
Common Stock 891 0.0% 891 0 0.0%
Employee Options 701,365 5.8% 49,109(6) 652,256 4.2%
------- ------ -------
Total 702,256 5.8% 50,000 652,256 4.2%
Laura Huberfeld
Common Stock 113,920 1.0% 113,920 0 0.0%
$5.30 Warrants(4) 186,288 1.6% 186,288 0 0.0%
$8.75 Warrants 300,208 2.6% 300,208 0 0.0%
------- ------- -------
Total 600,416 5.0% 600,416 0 0.0%
Naomi Bodner
Common Stock 113,920 1.0% 113,920 0 0.0%
$5.30 Warrants(4) 186,288 1.6% 186,288 0 0.0%
$8.75 Warrants 300,208 2.6% 300,208 0 0.0%
------- ------- -------
Total 600,416 5.0% 600,416 0 0.0%
Connie Lerner
Common Stock 158,603 1.4% 142,303 16,300 0.1%
$5.30 Warrants(4) 232,697 2.0% 232,697 0 0.0%
$8.75 Warrants 375,000 3.2% 375,000 0 0.0%
------- ------- ------
Total 766,300 6.4% 750,000 16,300 0.1%
Congregation Ahavas
Tzdokah Z'Chesed(5)
Common Stock 140,480 1.2% 140,480 0 0.0%
$5.30 Warrants(4) 229,728 2.0% 229,728 0 0.0%
$8.75 Warrants 370,208 3.1% 370,208 0 0.0%
------- ------- ------
Total 740,416 6.1% 740,416 0 0.0%
Ezer Mzion
Organization(5)
Common Stock 278,480 2.4% 140,480 138,000 0.9%
$5.30 Warrants(4) 229,728 2.0% 229,728 0 0.0%
$8.75 Warrants 370,208 3.1% 370,208 0 0.0%
------- ------- -------
Total 878,416 7.3% 740,416 138,000 0.9%
Jeffrey Rubin
Common Stock 1,792 0.0% 0 1,792 0.0%
$6.25 Warrants 83,584 0.7% 83,584 0 0.0%
------ ------ -----
Total 85,376 0.7% 83,584 1,792 0.0%
Robert Cohen
Common Stock 8,000 0.1% 0 8,000 0.1%
$6.25 Warrants 139,307 1.2% 139,307 0 0.0%
------- ------- -----
Total 147,307 1.3% 139,307 8,000 0.1%
Lenore Katz
Common Stock 0 0.0% 0 0.0%
$6.25 Warrants 27,861 0.2% 27,861 0 0.0%
------ ------ -----
Total 27,861 0.2% 27,861 0 0.0%
Jeffrey Cohen
Common Stock 0 0.0% 0 0 0.0%
$6.25 Warrants 27,861 0.2% 27,861 0 0.0%
------ ------ -----
Total 27,861 0.2% 27,861 0 0.0%
Allyson Cohen
Common Stock 0 0.0% 0 0 0.0%
$6.25 Warrants 27,861 0.2% 27,861 0 0.0%
------ ------ -----
Total 27,861 0.2% 27,861 0 0.0%
Shawn Zimberg
Common Stock 0 0.0% 0 0 0.0%
$6.25 Warrants 27,861 0.2% 27,861 0 0.0%
------ ------ -----
Total 27,861 0.2% 27,861 0 0.0%
Competitive Edge
Consultants, Inc.
Common Stock 0 0.0% 0 0 0.0%
$6.25 Warrants 50,000 0.4% 50,000 0 0.0%
------ ------ -----
Total 50,000 0.4% 50,000 0 0.0%
Brian Finkel
Common Stock 0 0.0% 0 0 0.0%
Options 100,000 0.9% 100,000 0 0.0%
------- ------- -----
Total 100,000 0.9% 100,000 0 0.0%
</TABLE> |
