Delaware
(State
of other jurisdiction
of
incorporation)
|
2086
(Primary
Standard
Industrial
Classification
Code Number)
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54-1965220
(IRS
Employer
Identification
Number)
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Title
of each class of securities to be registered
|
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Amount
to be
registered(1)
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Proposed
Maximum
offering
price per security(2)
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Proposed
Maximum Amount of Aggregate offering price
|
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Amount
of Registration Fee
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||||
Common
stock, no par value per share(3)
|
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2,000,000
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$
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0.60
|
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$
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1,200,000.00
|
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$
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36.84
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Common
stock, no par value per share(4)
|
|
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1,776,350
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$
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0.60
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$
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1,065,810.00
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$
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32.72
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Common
stock, no par value per share(5)
|
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17,050
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$
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0.60
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$
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10,230.00
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$
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0.31
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(1)
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Pursuant
to Rule 416(a) of the Securities Act of 1933, as amended, this
registration statement shall be deemed to cover additional securities
that
may be offered or issued to prevent dilution resulting from stock
splits,
stock dividends or similar transactions.
|
(2)
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Estimated
solely for the purpose of computing the amount of the registration
fee
pursuant to Rule 457(c). For the purposes of this table, we have
used the
average of the closing bid and ask prices of the common stock as
traded in
the over the counter market and reported on the OTC Electronic Bulletin
Board on August 27, 2007.
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(3)
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Shares
of common stock to be offered in connection with an equity line of
credit
arrangement.
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(4)
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Shares
of common stock being registered for resale that are owned by certain
selling shareholders named in the prospectus.
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(5)
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Represents
shares of common stock being registered for resale that have been
or may
be acquired upon the exercise of common stock purchase warrants at
an
exercise price of $0.85/share issued to certain selling stockholders
named
in the prospectus.
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5
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9
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15
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16
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16
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18
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19
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23
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24
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24
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24
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31
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36
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37
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38
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39
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40
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41
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41
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42
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43
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43
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43
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43
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F-1
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· |
2,500
shares of our common stock;
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· |
$1,500
of 11% convertible promissory notes, Series A, maturing on September
1,
2009, and convertible into shares of common stock at an exercise
price of
$0.85 per share any time after six months from the date of issuance;
and
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· |
A
warrant to purchase 300 shares of our common stock that is exercisable
for
a period of five years from issuance at $0.85 per share.
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Stockholder
|
#
of Shares
|
|||
Dutchess
Private Equities Fund, L.P.
|
2,000,000
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(1)
|
||
Griffdom Enterprises | 700,000 | |||
Joel
Sens
|
500,000
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(2)
|
||
K&C Investments | 300,000 | |||
RBC
Dain Rauscher Cust William Dunn IRA
|
17,600
|
|||
RBC
Dain Rauscher Cust Eugenia Medlock IRA
|
17,000
|
|||
RBC
Dain Rauscher Cust James T. Lewis IRA
|
15,700
|
|||
IFS
Holdings, Inc.
|
13,400
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(3)
|
||
RBC
Dain Rauscher Cust Cynthia Lee McDonald IRA
|
13,000
|
|||
RBC
Dain Rauscher Cust Barry Dunn SEP/IRA
|
11,900
|
|||
Matthew
K. Becksteadd TTEE Matthew K. Beckstead Revocable Trust
|
10,000
|
|||
John
R. Velky
|
10,000
|
|||
RBC
Dain Rauscher Cust Nancy Kines IRA
|
9,700
|
|||
RBC
Dain Rauscher Cust Louis Mulherin Jr. IRA
|
9,000
|
|||
RBC
Dain Rauscher Cust Horace G. Blalock IRA
|
8,600
|
|||
Jana
S. Pine
|
7,700
|
|||
RBC
Dain Rauscher Cust Kenneth D. Simpson IRA
|
7,500
|
|||
RBC
Dain Rauscher Cust Henry Alperin IRA
|
7,000
|
|||
Echols
J. Martin DMD PSP
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7,000
|
|||
RBC
Dain Rauscher Cust Caroline T. Richardson IRA
|
6,400
|
|||
RBC
Dain Rauscher Cust Charles Daniel IRA
|
6,200
|
|||
RBC
Dain Rauscher Cust Robert Edmond IRA
|
5,400
|
|||
RBC
Dain Rauscher Cust Jackie Brooks Roth IRA
|
5,300
|
|||
RBC
Dain Rauscher Cust John R. Velky IRA
|
5,200
|
|||
Henry
Alperin
|
5,100
|
|||
Kimberly
S. Sligh
|
4,800
|
|||
Thomas
D. Thompson
|
4,000
|
|||
RBC
Dain Rauscher Cust J. Lavern McCullough IRA
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3,700
|
|||
RBC
Dain Rauscher Cust Ted A. Poor IRA
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3,200
|
|||
Carolyn
H. Byrd
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3,200
|
|||
RBC
Dain Rauscher Cust William A. Smith IRA
|
3,100
|
|||
RBC
Dain Rauscher Cust Robert J. Ferrara IRA
|
3,000
|
|||
RBC
Dain Rauscher Cust Pamela K. Richardson Roth IRA
|
3,000
|
|||
RBC
Dain Rauscher Cust Geraldine N. Videtto IRA
|
3,000
|
|||
RBC
Dain Rauscher Cust Jack T. Williams IRA
|
3,000
|
|||
Robert
C. Wilson
|
3,000
|
|||
RBC
Dain Rauscher Cust Burgess M. Allen Jr. Roth IRA
|
2,600
|
|||
RBC
Dain Rauscher Cust Sonan L. Ashley Roth IRA
|
2,500
|
|||
Valerie
Biskey
|
2,500
|
|||
Robert
L.Bower
|
2,500
|
|||
RBC
Dain Rauscher Cust Nancy Locklear IRA
|
2,500
|
|||
M.
Dixon McKay
|
2,500
|
|||
RBC
Dain Rauscher Cust Hilton E. Vaughn Sr. IRA
|
2,500
|
|||
Tammy
Corley
|
2,150
|
|||
William
D. Corley
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2,150
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(4)
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||
RBC
Dain Rauscher Cust A. Louis Hook Jr. IRA
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2,000
|
|||
RBC
Dain Rauscher Cust Dorth G. Falls IRA
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1,800
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|||
RBC
Dain Rauscher Cust Robert F. Heishman IRA
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1,800
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|||
RBC
Dain Rauscher Cust Patsy A. Fisher Roth IRA
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1,700
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|||
RBC
Dain Rauscher Cust Phillip R. Mason IRA
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1,700
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|||
RBC
Dain Rauscher Cust Joseph H. May IRA
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1,700
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|||
RBC
Dain Rauscher Cust Kenneth J. Remington IRA
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1,600
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|||
Robert
L. Abshire
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1,500
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|||
RBC
Dain Rauscher Cust Barbara Sue Bramlett IRA
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1,500
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|||
Furman
Terry Richardson
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1,500
|
|||
Stuart
R. Wilson
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1,500
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|||
Waymon
E. Ragan and Lorena B. Ragan Jt. Ten./WROS
|
1,500
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(5)
|
||
RBC
Dain Rauscher Cust Joanne I. Leonard IRA
|
1,100
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Bryan
Coats
|
1,000
|
|||
RBC
Dain Rauscher Cust Faye S. Jennings IRA
|
1,000
|
|||
James
R. Kelley
|
1,000
|
|||
Alice
McCoy
|
1,000
|
|||
RBC
Dain Rauscher Cust Thomas D. Thompson IRA
|
1,000
|
|||
Ken
Wilson
|
1,000
|
|||
RBC
Dain Rauscher Cust Lawrence E. Mobley III SEP/IRA
|
900
|
|||
A
Boardman Co LLC
|
900
|
|||
Michael
C Rogers & Pam K. Roger Jt. Ten.
|
900
|
|||
RBC
Dain Rauscher Cust Ken Wilson Roth IRA
|
800
|
|||
RBC
Dain Rauscher Cust Verda Elrod Roth IRA
|
600
|
|||
Gerry
Rhodes
|
600
|
|||
RBC
Dain Rauscher Cust Phoebe Tuten IRA
|
600
|
|||
Mark
D. Anderson
|
500
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|||
RBC
Dain Rauscher Cust Milton O. Dickson Sr. Roth IRA
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500
|
|||
Kevin
Fogarty & Michelle Fogarty Jt. Ten.
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500
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|||
Randall
Redmond
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500
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|||
George
M. Willson & Crystal J. Willson
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400
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|||
RBC
Dain Rauscher Cust Franklin D. Hart Jr. Roth IRA
|
300
|
|||
RBC
Dain Rauscher Cust Wanda Hart Roth IRA
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300
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|||
Elisabeth
T. Keller
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300
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|||
T.
Barrett Trotter
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300
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(1)
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Consists
of 2,000,000 of the shares that may be issued pursuant to the Equity
Line
of Credit.
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(2)
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Consists
of 500,000 shares of common stock.
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(3)
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Consists
of 13,400 shares that may be acquired at $0.85 per share upon exercise
of
warrants.
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(4)
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Consists
of 2,150 shares that may be acquired at $0.85 per share upon exercise
of
warrants.
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(5)
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Consists
of 1,500 shares that may be acquired at $0.85 per share upon exercise
of
warrants.
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Common
Stock Outstanding:
|
||||
Before
the offering
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14,792,896
shares
|
(1)
|
||
After
the offering
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16,809,946
shares
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(2)
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(1)
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Assumes:
|
|
·
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No
conversion of promissory notes outstanding as of August 31,
2007:
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Promissory
Note Holder
|
Exercise
Price
|
#
of Common
Stock
Shares
|
|||||
Beverly
Sanders III
|
$
|
0.85
|
5,294
|
|
|||
Beverly
Sanders JR
|
$
|
0.85
|
26,471
|
|
|||
Myrtle
Sanders
|
$
|
0.85
|
5,294
|
|
|
·
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No
conversion of options outstanding as of August 31,
2007:
|
Option
Holder
|
Option
Price
|
#
of Common
Stock
Shares
|
|||||
Joel
Sens
|
$
|
0.50
|
400,000
|
||||
Joel
Sens
|
$
|
1.00
|
300,000
|
||||
Joel
Sens
|
$
|
1.75
|
300,000
|
||||
Joel
Sens
|
$
|
2.00
|
500,000
|
|
·
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No
conversion of warrants outstanding as of August 31,
2007:
|
Warrant
Holder
|
Exercise
Price
|
#
of Common
Stock
Shares
|
|||||
Ron
Attkisson
|
$
|
0.85
|
300,000
|
||||
IFS
Holdings, Inc.
|
$
|
0.85
|
13,400
|
||||
William
D. Corley
|
$
|
0.85
|
2,150
|
||||
Waymon
E. Ragan and Lorena B. Ragan Jt. Ten./WROS
|
$
|
0.85
|
1,500
|
||||
Beverly
Sanders III
|
$
|
0.85
|
900
|
||||
Beverly
Sanders JR, IRA
|
$
|
0.85
|
4,500
|
||||
Myrtle
Sanders
|
$
|
0.85
|
900
|
(2)
|
For
the purpose of determining the number of shares subject to registration
with the SEC, we have assumed that we will issue not more than 2,000,000
shares pursuant to the exercise of our put rights under the investment
agreement, although the number of shares that we will actually issue
pursuant to that put right may be more than or less than 2,000,000,
depending on the trading price of our common stock and the number
of times
we draw down on the Equity Line of Credit. If we were to exercise
the put
right that would result in our issuance of more than 2,000,000 shares,
we
would be required to file a subsequent registration statement with
the SEC
and for that registration statement to be deemed effective prior
to the
issuance of any such additional
shares.
|
|
· |
market
acceptance of our products;
|
|
· |
our
ability to provide for our obligations;
|
|
· |
our
ability to attract customers at a steady rate and maintain customer
satisfaction;
|
|
· |
the
amount and timing of operating costs and capital expenditures relating
to
the initial conduct and expansion of our business, operations and
infrastructure and the implementation of marketing programs, key
agreements and strategic alliances;
|
|
· |
our
ability to obtain additional financing needed for any future acquisitions
of assets or companies;
|
|
· |
our
ability to meet competitive challenges and technological changes;
|
|
· |
general
economic conditions specific to the beverage market and specifically
the
spring water industry; and
|
|
· |
other
risks detailed in our periodic report filings with the SEC or specifically
listed in the risk factors below.
|
We
have had losses since our inception, expect losses to continue in
the
future and may never become profitable
|
|
We
have historically generated substantial losses, which, if continued,
could
make it difficult to fund our operations or successfully execute
our
business plan, and could adversely affect our stock price. For the
period
from inception through June 30, 2007, we have accumulated losses
totaling
$5,900,003. We experienced net losses of $1,439,840 for the three
months
ended June 30, 2007, $423,429 for the three months ended June 30,
2006,
$1,785,386 for the year ended December 31, 2006 and $1,116,048 for
the
year ended December 31, 2005. We experienced negative cash flow from
operations of $1,284,813 for the six months ended June 30,
2007, negative cash flow from operations of $423,890 for the six
months ended June 30, 2006, negative cash flow from operations of
$918,939 for the year ended December 31, 2006, and positive cash
flow from
operations of $410,297 for
the year ended December 31, 2005. We anticipate that we will generate
net
losses in the near term and we may not be able to achieve or maintain
profitability or positive cash flow at any time in the
future.
|
We
have a limited operating history and may never achieve or sustain
profitable operations
|
|
We
have only been operating for a short time and have not yet achieved
significant sales or made a profit from operations. We have generated
limited revenues from our current products of $7,912 from inception
through June 30, 2007.
In
addition, we have a limited history of competing in the intensely
competitive bottled water industry. Our products may not be successfully
commercialized or marketed. As a result, we may never achieve or
sustain
profitable operations.
We
will also be incurring costs to develop, introduce and enhance our
spring
water operations and products, to develop and market an interactive
website, to establish marketing relationships, to acquire and develop
products that will complement each other, and to build an administrative
organization. To the extent that such expenses are not followed by
commensurate revenue, our business, results of operations and financial
condition will be materially and adversely affected.
|
Quarterly
results may fluctuate significantly due to a variety of
factors
|
|
Our
quarterly operating results may fluctuate significantly in the future
as a
result of a variety of factors, most of which are outside our control,
including:
· the
level of public acceptance of our spring water operations and
business;
· the
demand for spring water services and related products;
· seasonal
trends in demand;
· the
amount and timing of capital expenditures and other costs relating
to the
initial conduct of our business and the expansion of our operations;
· the
introduction of new services and products by us or our competitors;
· price
competition or pricing changes in the industry;
· technical
difficulties; and
· general
economic conditions as well as economic conditions specific to the
beverage industry.
Our
quarterly results may also be significantly affected by the impact
of the
accounting treatment of acquisitions, financing transactions or other
matters. Particularly at our early stage of development, such accounting
treatment can have a material impact on our results for any quarter.
Due
to the foregoing factors, among others, it is likely that our operating
results will fall below our expectations or our investors’ expectations in
some future quarter.
|
Our
accountants have indicated that if we do not generate enough cash
from
operations to sustain our business we may have to liquidate assets
or
curtail our operations
|
|
The
accompanying financial statements have been prepared assuming we
will
continue as a going concern. Since inception, we have accumulated
substantial losses. Conditions exist that raise substantial doubt
about
our ability to continue as a going concern unless we are able to
generate
sufficient cash flows to meet our obligations and sustain our operations.
|
We
may be subject to product liability claims and our insurance may
not be
adequate to cover such claims
|
|
The
marketing and selling of our products will expose us to product liability
risk. Any future claim against us for product liability could materially
and adversely affect our business, financial condition, and results
of
operations and result in negative publicity. Even if we are not found
liable, the costs of defending a lawsuit can be high.
We
currently carry insurance for this type of liability, which provides
coverage in the amount of $1,000,000. However, we may experience
legal
claims outside of our insurance coverage or in excess of our insurance
coverage.
|
We
are subject to substantial competition and so may not have the ability
or
the capital to compete effectively
|
|
The
industry in which we expect our products to be sold is highly competitive.
We may not have the ability or the capital to compete effectively
in this
environment.
The
significant competition in our industry could harm our ability to
win
business and increase the price pressure on our products. We face
strong
competition from a wide variety of firms, including large, multinational
firms with far greater resources than we possess.
Many
of our competitors have considerably greater financial, marketing
and
technological resources than we do, which may make it difficult to
sell
our products. Many of our competitors also have longer operating
histories
and presence in key markets, greater name recognition, larger customer
bases and significantly greater financial, sales and marketing,
manufacturing, distribution, technical and other resources. As a
result,
these competitors may also be able to devote greater resources to
the
promotion and sale of their products.
|
We
must comply with environmental regulations or we may have to pay
expensive
penalties or clean up costs
|
|
We
are subject to federal, state and local laws, and regulations regarding
protection of the environment, including air, water, and soil. We
do not
maintain insurance for pollutant cleanup and removal. If we are found
responsible for any hazardous contamination, we may have to pay expensive
fines or penalties or perform costly clean-up. Even if we are charged
and
later found not responsible for such contamination or clean up, the
cost
of defending the charges could be high.
|
If
we do not comply with government regulations, we may be unable to
ship our
products or have to pay expensive fines or penalties
|
|
We
are subject to regulation by state and federal governments and
governmental agencies. If we fail to obtain regulatory approvals
or suffer
delays in obtaining regulatory approvals, we may not be able to market
our
products and services and generate product and service revenues.
Although
we do not anticipate problems satisfying any of the regulations involved,
we cannot foresee the possibility of new regulations that could adversely
affect our business.
|
If
land we recently acquired is not favorably re-zoned, we may be unable
to
lease the land for commercial purposes
|
|
In
May of 2005 and in April of 2006, respectively, we completed the
purchase
of two parcels of land located in Staunton, Virginia. We are considering
leasing both of these properties for commercial purposes. Currently,
both
properties are not zoned for commercial use. We expect both sites
will be
re-zoned to commercial use from general agricultural use based upon
our
review of the master zoning plan of the city of Staunton, Virginia.
If the
sites are not re-zoned, we will not be able to lease the properties
for
commercial purposes and we will have to consider alternative uses
or
selling the properties. If we sell the properties, we may have to
sell
them at a loss.
|
Insiders
can exert significant control over our policies and
affairs
|
|
As
of June 30, 2007, our chief executive officer and principal
stockholder, Joel Sens, beneficially owned approximately 37% of our
outstanding common stock on a fully-diluted basis. As a result, Mr.
Sens
effectively controls all of our affairs and policies, including matters
requiring stockholder approval, such as amendments to our certificate
of
incorporation, fundamental corporate transactions including mergers,
acquisitions and the sale of the company, and other matters involving
the
direction of our business and affairs. Although you may vote your
shares,
you will have limited influence on our business and
management.
|
We
currently have one employee and we may not be able to execute our
business
plan without his services
|
|
Mr.
Sens is presently our sole employee and is employed without any formal
contract establishing terms of employment or compensation. We are
therefore dependent upon Mr. Sens, who works for us as an at will
employee, with respect to our operations and management. If Mr. Sens
is
unable to devote substantial time and attention to our operations
for
whatever reason or decides to change his employment, our business
will be
materially and adversely affected.
We
believe that, as our activities increase and change in character,
additional, experienced personnel will be required to implement our
business plan. Competition for such personnel is intense and we may
not be
able to attract and retain such personnel.
|
We
may not be able to successfully manage growth of our
business
|
|
Our
future success will be highly dependent upon our ability to successfully
manage the anticipated expansion of our operations. Our ability to
manage
and support growth effectively will be substantially dependent on
our
ability to implement adequate financial and management controls,
reporting
systems and other procedures, and attract and retain sufficient numbers
of
qualified technical, sales, marketing, financial, accounting,
administrative and management personnel.
Our
future success also depends upon our ability to address potential
market
opportunities while managing expenses to match our ability to finance
our
operations. This need to manage our expenses will place a significant
strain on our management and operational resources. If we are unable
to
manage our expenses effectively, our business, results of operations
and
financial condition will be materially and adversely
affected.
|
Risks
associated with acquisitions
|
|
Although
we do not presently intend to do so, as part of our business strategy
in
the future, we could acquire assets and businesses relating to or
complementary to our operations. Any acquisitions by us would involve
risks commonly encountered in acquisitions of assets or companies.
These
risks would include, among other things, the following:
· we
could be exposed to unknown liabilities of the acquired companies;
|
· we
could incur acquisition costs and expenses higher than
anticipated;
· fluctuations
in our quarterly and annual operating results could occur due to
the costs
and expenses of acquiring and integrating new businesses or technologies;
· we
could experience difficulties and expenses in assimilating the operations
and personnel of any acquired businesses;
· our
ongoing business could be disrupted and our management’s time and
attention diverted; and
· we
could be unable to integrate with any acquired businesses
successfully.
|
“Penny
Stock” rules may make buying or selling our securities
difficult
|
|
Trading
in our securities is subject to the SEC’s “penny stock” rules and it is
anticipated that trading in our securities will continue to be subject
to
the penny stock rules for the foreseeable future. The SEC has adopted
regulations that generally define a penny stock to be any equity
security
that has a market price of less than $5.00 per share, subject to
certain
exceptions. These rules require that any broker-dealer who recommends
our
securities to persons other than prior customers and accredited investors
must, prior to the sale, make a special written suitability determination
for the purchaser and receive the purchaser’s written agreement to execute
the transaction. Unless an exception is available, the regulations
require
the delivery, prior to any transaction involving a penny stock, of
a
disclosure schedule explaining the penny stock market and the risks
associated with trading in the penny stock market. In addition,
broker-dealers must disclose commissions payable to both the broker-dealer
and the registered representative and current quotations for the
securities they offer. The additional burdens imposed upon broker-dealers
by such requirements may discourage broker-dealers from recommending
transactions in our securities, which could severely limit the liquidity
of our securities and consequently adversely affect the market price
for
our securities.
|
Existing
stockholders may experience significant dilution from the sale of
securities pursuant to the investment agreement with Dutchess and
the sale
of securities by the selling stockholders
|
|
The
sale of shares pursuant to the investment agreement with Dutchess
will
have a dilutive impact on our stockholders. As a result, our net
income
per share, if any, could decrease in future periods, and the market
price
of our common stock could decline. In addition, the lower our stock
price
at the time we exercise our put rights, the more shares we will have
to
issue to Dutchess to draw down on the full Equity Line of Credit
with
Dutchess. If our stock price decreases, then our existing stockholders
would experience greater dilution.
In
addition, through our prior private placement that closed in February
2005, we sold warrants and convertible promissory notes that are
convertible into our common stock. We have also issued options convertible
into our common stock to certain of the selling stockholders. Some
of
these securities are still outstanding and any exercise of them will
have
a dilutive impact on our
stockholders.
|
Finally,
if cash generated by our operations is
insufficient to satisfy our liquidity requirements, we may be required
to
sell additional equity or debt securities. The sale of additional
equity
or convertible debt securities would result in additional dilution
to our
stockholders.
|
||
Because
Dutchess will pay less than the then-prevailing market price of our
common
stock and the other selling stockholders listed in this prospectus
may pay
less than the then-prevailing market price of our common stock our
stock
price may decline
|
|
The
common stock to be issued under our agreement with Dutchess will
be
purchased at a 5% discount to the lowest closing best bid price for
the
five trading days immediately following our notice to Dutchess of
our
election to exercise our put right. The other selling stockholders
may
exercise their conversion rights of the warrants at $0.85 per share,
which
may be less than the then-prevailing market price of our common stock.
These discounted sales could cause the price of our common stock
to
decline, and you may not be able to sell our stock for more than
you paid
for it.
|
Our
securities have been thinly traded on the OTCBB, which may not provide
liquidity for our investors
|
|
Our
securities are quoted on the OTCBB. The OTCBB is an inter-dealer,
over-the-counter market that provides significantly less liquidity
than
the NASDAQ Stock Market or other national or regional exchanges.
Securities traded on the OTCBB are usually thinly traded, highly
volatile,
have fewer market makers and are not followed by analysts. The SEC’s order
handling rules, which apply to NASDAQ-listed securities, do not apply
to
securities quoted on the OTCBB. Quotes for stocks included on the
OTCBB
are not listed in newspapers. Therefore, prices for securities traded
solely on the OTCBB may be difficult to obtain and holders of our
securities may be unable to resell their securities at or near their
original acquisition price, or at any price.
|
Investors
must contact a broker-dealer to trade OTCBB securities. As a result,
you
may not be able to buy or sell our securities at the times you
wish
|
|
Even
though our securities are quoted on the OTCBB, the OTCBB may not
permit
our investors to sell securities when and in the manner that they
wish.
Because there are no automated systems for negotiating trades on
the
OTCBB, trades are conducted via telephone. In times of heavy market
volume, the limitations of this process may result in a significant
increase in the time it takes to execute investor orders. Therefore,
when
investors place an order to buy or sell a specific number of shares
at the
current market price it is possible for the price of a stock to go
up or
down significantly during the lapse of time between placing a market
order
and its execution.
|
We
may not be able to access sufficient funds under the Equity Line
of Credit
with Dutchess when needed
|
|
We
will depend on external financing to fund our planned initial operations
and expansion. We expect that these financing needs will be substantially
met by our agreement with Dutchess. However, due to the terms of
the
investment agreement, this financing may not be available in sufficient
amounts or at all when needed. As a result, we may not be able to
grow our
business as planned.
|
We
do not intend to pay dividends in the foreseeable future; therefore,
you
may never see a return on your investment
|
|
We
do not anticipate the payment of cash dividends on our common stock
in the
foreseeable future. We anticipate that any profits from our operations
will be devoted to future operations. Any decision to pay dividends
will
depend upon our profitability at the time, cash available and other
factors. Therefore, you may never see a return on your investment.
Investors who anticipate a need for immediate income from their investment
should not purchase the securities offered in this
prospectus.
|
Our
stock price is volatile and you may not be able to sell your shares
for
more than what you paid
|
|
Our
stock price has been subject to significant volatility, and you may
not be
able to sell shares of common stock at or above the price you paid
for
them. The trading price of our common stock has been subject to wide
fluctuations in the past. During the three-month period ended June
30,
2007, our common stock traded at prices as low as $0.96 per share
and as
high as $2.45 per share. During our fiscal year ending 2006, our
common
stock traded at prices as low as $0.40 per share and as high as $1.50
per
share. During our fiscal year ending December 31, 2005, our common
stock
traded at prices as low as $0.40 per share and as high as $1.05 per
share.
Prior to January 9, 2004, there was no public trading market for
our
securities.
The
market price of the common stock could continue to fluctuate in the
future
in response to various factors, including, but not limited
to:
· quarterly
variations in operating results;
· our
ability to control costs and improve cash flow;
· announcements
of technological innovations or new products by us or by our
competitors;
· changes
in investor perceptions; and
· new
products or product enhancements by us or our
competitors.
|
|
|
The
stock market in general has continued to experience volatility which
may
further affect our stock price. As such, you may not be able to resell
your shares of common stock at or above the price you paid for
them.
|
|
Proceeds
if
100% Sold
|
Proceeds
if
50% Sold
|
|||||
Gross
proceeds
|
$
|
1,200,000
|
$
|
600,000
|
|||
Estimated
professional fees and SEC filing fees of offering
|
$
|
100,000
|
$
|
100,000
|
|||
1%
Placement Fee
|
$
|
12,000
|
$
|
6,000
|
|||
Net
proceeds
|
$
|
1,088,000
|
$
|
494,000
|
|
· |
delivery
of the certificates being purchased by Dutchess;
|
|
· |
a
registration statement has been declared effective and remains effective
for the resale of the common stock subject to the Equity Line of
Credit;
|
|
· |
the
registration statement, as required to be filed under the registration
rights agreement, and any amendments do not contain any untrue statements
of a material fact or omit to state any material fact;
|
|
· |
we
have complied with our obligations under the investment agreement
and the
registration rights agreement;
|
|
· |
no
injunction has been issued and remains in force, or action commenced
by a
governmental authority which has not been stayed or abandoned, prohibiting
the consummation of any of the transactions contemplated by the investment
agreement; and
|
|
· |
the
issuance of the common stock will not violate any shareholder approval
requirements of any exchange or market where our securities are
traded.
|
|
· |
the
trading of our common stock is suspended by the SEC, the OTCBB or
the
National Association of Securities Dealers, or NASD, for a period
of two
consecutive trading days; or
|
|
· |
our
common stock is de-listed from the OTCBB.
|
|
· |
Dutchess
has purchased an aggregate of $5,000,000 of our common stock;
or
|
|
· |
thirty-six
months after the SEC declares the registration statement, of which
this
prospectus is a part, effective.
|
|
Minimum
|
Maximum
|
|||||
|
Offering
|
Offering
|
|||||
Public
Offering Price Per Share
|
$
|
0.60
|
$
|
0.60
|
|||
Net
Tangible Book Value Prior to This Offering
|
$
|
0.03
|
$
|
0.03
|
|||
Net
Tangible Book Value After Offering
|
$
|
0.05
|
$
|
0.08
|
|||
Dilution
per share to new investors
|
$
|
0.55
|
$
|
0.52
|
Stockholder |
Number
of
Shares
Beneficially
Owned
Before
the
Offering
|
Number
of
Shares
Being
Offered
|
Number
of
Shares
Beneficially
Owned
After
The
Offering
(1)
|
|||||||
Dutchess
Private Equities Fund, L.P.
|
|
|
2,000,000
|
|
|
2,000,000
|
(2)
|
|
0
|
|
Griffdom Enterprises |
850,000
|
700,000
|
(3)
|
150,000
|
||||||
Joel
Sens
|
|
|
4,921,414
|
(4)
|
|
500,000
|
|
|
4,421,414
|
|
K&C
Investments
|
300,000
|
300,000
|
(5)
|
0
|
|
|||||
RBC
Dain Rauscher Cust William Dunn IRA
|
|
|
17,600
|
|
|
17,600
|
(6)
|
0
|
|
|
RBC
Dain Rauscher Cust Eugenia Medlock IRA
|
|
|
17,000
|
|
|
17,000
|
(7)
|
|
0
|
|
RBC
Dain Rauscher Cust James T. Lewis IRA
|
|
|
15,700
|
|
|
15,700
|
(8)
|
|
0
|
|
IFS
Holdings, Inc.
|
|
|
13,400
|
|
|
13,400
|
(9)
|
|
0
|
|
RBC
Dain Rauscher Cust Cynthia Lee McDonald IRA
|
|
|
13,000
|
|
|
13,000
|
(10)
|
|
0
|
|
RBC
Dain Rauscher Cust Barry Dunn SEP/IRA
|
|
|
11,900
|
|
|
11,900
|
(11)
|
|
0
|
|
Matthew
K. Beckstead TTEE Matthew K. Beckstead Revocable Trust
|
|
|
10,000
|
|
|
10,000
|
(12)
|
|
0
|
|
John
R. Velky
|
|
|
10,000
|
|
|
10,000
|
(12)
|
|
0
|
|
RBC
Dain Rauscher Cust Nancy Kines IRA
|
|
|
9,700
|
|
|
9,700
|
(13)
|
|
0
|
|
RBC
Dain Rauscher Cust Louis Mulherin Jr. IRA
|
|
|
9,000
|
|
|
9,000
|
(14)
|
|
0
|
|
RBC
Dain Rauscher Cust Horace G. Blalock IRA
|
|
|
8,600
|
|
|
8,600
|
(15)
|
|
0
|
|
Jana
S. Pine
|
|
|
7,700
|
|
|
7,700
|
(16)
|
|
0
|
|
RBC
Dain Rauscher Cust Kenneth D. Simpson IRA
|
|
|
7,500
|
|
|
7,500
|
(17)
|
|
0
|
|
RBC
Dain Rauscher Cust Henry Alperin IRA
|
|
|
7,000
|
|
|
7,000
|
(18)
|
|
0
|
|
Echols
J. Martin DMD PSP
|
|
|
7,000
|
|
|
7,000
|
(18)
|
|
0
|
|
RBC
Dain Rauscher Cust Caroline T. Richardson IRA
|
|
|
6,400
|
|
|
6,400
|
(19)
|
|
0
|
|
RBC
Dain Rauscher Cust Charles Daniel IRA
|
|
|
6,200
|
|
|
6,200
|
(20)
|
|
0
|
|
RBC
Dain Rauscher Cust Robert Edmond IRA
|
|
|
5,400
|
|
|
5,400
|
(21)
|
|
0
|
|
RBC
Dain Rauscher Cust Jackie Brooks Roth IRA
|
|
|
5,300
|
|
|
5,300
|
(22)
|
|
0
|
|
RBC
Dain Rauscher Cust John R. Velky IRA
|
|
|
5,200
|
|
5,200
|
(23)
|
|
0
|
|
|
Henry
Alperin
|
|
|
5,100
|
|
|
5,100
|
(24)
|
|
0
|
|
Kimberly
S. Sligh
|
|
|
4,800
|
|
|
4,800
|
(25)
|
|
0
|
|
Thomas
D. Thompson
|
|
|
4,000
|
|
|
4,000
|
(26)
|
|
0
|
|
RBC
Dain Rauscher Cust J. Lavern McCullough IRA
|
|
|
3,700
|
|
|
3,700
|
(27)
|
|
0
|
|
RBC
Dain Rauscher Cust Ted A. Poor IRA
|
|
|
3,200
|
|
3,200
|
(28)
|
|
0
|
|
|
Carolyn
H. Byrd
|
|
|
3,200
|
|
3,200
|
(28)
|
|
0
|
|
|
RBC
Dain Rauscher Cust William A. Smith IRA
|
|
|
3,100
|
|
|
3,100
|
(29)
|
|
0
|
|
RBC
Dain Rauscher Cust Robert J. Ferrara IRA
|
|
|
3,000
|
|
|
3,000
|
(30)
|
|
0
|
|
RBC
Dain Rauscher Cust Pamela K. Richardson Roth IRA
|
|
|
3,000
|
|
|
3,000
|
(30)
|
|
0
|
|
RBC
Dain Rauscher Cust Geraldine N. Videtto IRA
|
|
|
3,000
|
|
|
3,000
|
(30)
|
|
0
|
|
RBC
Dain Rauscher Cust Jack T. Williams IRA
|
|
|
3,000
|
|
|
3,000
|
(30)
|
|
0
|
|
Robert
C. Wilson
|
|
|
3,000
|
|
|
3,000
|
(30)
|
|
0
|
|
RBC
Dain Rauscher Cust Burgess M. Allen Jr. Roth IRA
|
|
|
2,600
|
|
2,600
|
(31)
|
|
0
|
|
|
RBC
Dain Rauscher Cust Sonan L. Ashley Roth IRA
|
|
|
2,500
|
|
|
2,500
|
(32)
|
|
0
|
|
Valerie
Biskey
|
|
|
2,500
|
|
|
2,500
|
(32)
|
|
0
|
|
Robert
L. Bower
|
|
|
2,500
|
|
|
2,500
|
(32)
|
|
0
|
|
RBC
Dain Rauscher Cust Nancy Locklear IRA
|
|
|
2,500
|
|
|
2,500
|
(32)
|
|
0
|
|
M.
Dixon McKay
|
|
|
2,500
|
|
|
2,500
|
(32)
|
|
0
|
|
RBC
Dain Rauscher Cust Hilton E. Vaughn Sr. IRA
|
|
|
2,500
|
|
|
2,500
|
(32)
|
|
0
|
|
Tammy
Corley
|
|
|
2,150
|
|
|
2,150
|
(33)
|
|
0
|
|
William
D. Corley
|
|
|
2,150
|
|
2,150
|
(34)
|
|
0
|
|
|
RBC
Dain Rauscher Cust A. Louis Hook Jr. IRA
|
|
|
2,000
|
|
|
2,000
|
(35)
|
|
0
|
|
RBC
Dain Rauscher Cust Dorth G. Falls IRA
|
|
|
1,800
|
|
|
1,800
|
(36)
|
|
0
|
|
RBC
Dain Rauscher Cust Robert F. Heishman IRA
|
|
|
1,800
|
|
|
1,800
|
(36)
|
|
0
|
|
RBC
Dain Rauscher Cust Patsy A. Fisher Roth IRA
|
|
|
1,700
|
|
|
1,700
|
(37)
|
|
0
|
|
RBC
Dain Rauscher Cust Phillip R. Mason IRA
|
|
|
1,700
|
|
|
1,700
|
(37)
|
|
0
|
|
RBC
Dain Rauscher Cust Joseph H. May IRA
|
|
|
1,700
|
|
|
1,700
|
(37)
|
|
0
|
|
RBC
Dain Rauscher Cust Kenneth J. Remington IRA
|
|
|
1,600
|
|
|
1,600
|
(38)
|
|
0
|
|
Robert
L. Abshire
|
|
|
1,500
|
|
|
1,500
|
(39)
|
|
0
|
|
RBC
Dain Rauscher Cust Barbara Sue Bramlett IRA
|
|
|
1,500
|
|
|
1,500
|
(39)
|
|
0
|
|
Furman
Terry Richardson
|
|
|
1,500
|
|
|
1,500
|
(39)
|
|
0
|
|
Stuart
R. Wilson
|
|
|
1,500
|
|
|
1,500
|
(39)
|
|
0
|
|
Waymon
E. Ragan and Lorena B. Ragan Jt. Ten./WROS
|
|
|
1,500
|
|
|
1,500
|
(40)
|
|
0
|
|
RBC
Dain Rauscher Cust Joanne I. Leonard IRA
|
|
|
1,100
|
|
1,100
|
(41)
|
|
0
|
|
|
Bryan
Coats
|
|
|
1,000
|
|
|
1,000
|
(42)
|
|
0
|
|
RBC
Dain Rauscher Cust Faye S. Jennings IRA
|
|
|
1,000
|
|
|
1,000
|
(42)
|
|
0
|
|
James
R. Kelley
|
|
|
1,000
|
|
|
1,000
|
(42)
|
|
0
|
|
Alice
McCoy
|
|
|
1,000
|
|
|
1,000
|
(42)
|
|
0
|
|
RBC
Dain Rauscher Cust Thomas D. Thompson IRA
|
|
|
1,000
|
|
|
1,000
|
(42)
|
|
0
|
|
Ken
Wilson
|
|
|
1,000
|
|
|
1,000
|
(42)
|
|
0
|
|
A
Boardman Co LLC
|
|
|
900
|
|
|
900
|
(43)
|
|
0
|
|
RBC
Dain Rauscher Cust Lawrence E. Mobley III SEP/IRA
|
|
|
900
|
|
|
900
|
(44)
|
|
0
|
|
Michael
C. Rogers & Pam K. Roger Jt. Ten.
|
|
|
900
|
|
|
900
|
(45)
|
|
0
|
|
RBC
Dain Rauscher Cust Ken Wilson Roth IRA
|
|
|
800
|
|
|
800
|
(46)
|
|
0
|
|
RBC
Dain Rauscher Cust Verda Elrod Roth IRA
|
|
|
600
|
|
|
600
|
(47)
|
|
0
|
|
Gerry
Rhodes
|
|
|
600
|
|
|
600
|
(47)
|
|
0
|
|
RBC
Dain Rauscher Cust Phoebe Tuten IRA
|
|
|
600
|
|
|
600
|
(47)
|
|
0
|
|
Mark
D. Anderson
|
|
|
500
|
|
|
500
|
(48)
|
|
0
|
|
RBC
Dain Rauscher Cust Milton O. Dickson Sr. Roth IRA
|
|
|
500
|
|
|
500
|
(48)
|
|
0
|
|
Kevin
Fogarty & Michelle Fogarty Jt. Ten.
|
|
|
500
|
|
|
500
|
(48)
|
|
0
|
|
Randall
Redmond
|
|
|
500
|
|
|
500
|
(48)
|
|
0
|
|
George
M. Willson & Crystal J. Willson
|
|
|
400
|
|
|
400
|
(49)
|
|
0
|
|
RBC
Dain Rauscher Cust Franklin D. Hart Jr. Roth IRA
|
|
|
300
|
|
|
300
|
(50)
|
|
0
|
|
RBC
Dain Rauscher Cust Wanda Hart Roth IRA
|
|
|
300
|
|
|
300
|
(50)
|
|
0
|
|
Elisabeth
T. Keller
|
|
|
300
|
|
|
300
|
(50)
|
|
0
|
|
T.
Barrett Trotter
|
|
|
300
|
|
|
300
|
(50)
|
|
0
|
|
Total
number of shares offered for resale
|
|
|
|
|
|
3,793,400
|
|
|
|
|
(1)
|
The
numbers assume that the selling stockholders have sold all
of the shares
offered hereby prior to completion of this offering.
|
(2)
|
Represents
shares we may issue to Dutchess pursuant to the Equity Line
of Credit.
Since we are not obligated to use the Equity Line of Credit
and the amount
of shares that we may issue pursuant to the Equity Line of
Credit is
partly based on the future market price of our common stock,
we cannot
predict with accuracy the actual number of shares we may issue
to
Dutchess.
|
|
Michael
Novielli and Douglas Leighton are the Managing Members of Dutchess
Capital
Management, which is the general partner of Dutchess and, accordingly,
may
be deemed to have voting and dispositive power over securities
held for
the account of Dutchess.
|
(3)
|
Consists
of 700,000 shares of common stock.
|
(4)
|
Consists
of 3,350,4144 shares of common stock,
400,000 shares that may be acquired at $0.50 per share upon the
exercise
of options, 300,000 shares that may be acquired at $1.00 per share
upon
the exercise of options, 300,000 shares that may be acquired at
$1.75 per
share upon the exercise of options and 500,000 shares that may
be acquired
at $2.00 per share upon the exercise of options.
|
(5)
|
Consists
of 300,000 shares of common stock.
|
(6)
|
Consists
of 17,600 shares of common stock.
|
(7)
|
Consists
of 17,000 shares of common stock.
|
(8)
|
Consists
of 15,700 shares of common stock.
|
(9)
|
Includes
13,400 shares that may be acquired at $0.85 per share upon exercise
of
warrants. Ron Attkisson and John Pope Jones are the controlling
shareholders of IFS Holdings, Inc., and, accordingly, they may
be deemed
to share voting and investment power over shares held by IFS Holdings,
Inc. In addition, IFS Holdings, Inc. owns 99% of Jones, Byrd and
Attkisson. IFS Holdings, Inc. may be deemed to be an affiliate
of the
broker dealer Jones, Byrd and Attkisson. Accordingly, IFS Holdings,
Inc.
has informed the Company that: (1) IFS Holdings, Inc. acquired
the
Company's securities in the ordinary course of business; and (2)
IFS
Holdings, Inc. did not have any agreement or understanding, directly
or
indirectly, at the time of
purchase
with any person to distribute the securities.
|
(10)
|
Consists
of 13,000 shares of common stock.
|
(11)
|
Consists
of 11,900 shares of common stock.
|
(12)
|
Consists
of 10,000 shares of common stock.
|
(13)
|
Consists
of 9,700 shares of common stock.
|
(14)
|
Consists
of 9,000 shares of common stock.
|
(15)
|
Consists
of 8,600 shares of common stock.
|
(16)
|
Consists
of 7,700 shares of common stock.
|
(17)
|
Consists
of 7,500 shares of common stock.
|
(18)
|
Consists
of 7,000 shares of common stock.
|
(19)
|
Consists
of 6,400 shares of common stock.
|
(20)
|
Consists
of 6,200 shares of common stock.
|
(21)
|
Consists
of 5,400 shares of common stock.
|
(22)
|
Consists
of 5,300 shares of common stock..
|
(23)
|
Consists
of 5,200 shares of common stock.
|
(24)
|
Consists
of 5,100 shares of common stock.
|
(25)
|
Consists
of 4,800 shares of common stock.
|
(26)
|
Consists
of 4,000 shares of common stock.
|
(27)
|
Consists
of 3,700 shares of common stock.
|
(28)
|
Consists
of 3,200 shares of
common stock.
|
(29)
|
Consists
of 3,100 shares of
common stock.
|
(30)
|
Consists
of 3,000 shares of
common stock.
|
(31)
|
Consists
of 2,600 shares of
common stock.
|
(32)
|
Consists
of 2,500 shares of
common stock.
|
(33)
|
Consists
of 2,150 shares of
common stock.
|
(34)
|
Includes
2,150 shares that may be acquired at $0.85 per share upon exercise
of
warrants.
|
(35)
|
Consists
of 2,000 shares of
common stock.
|
(36)
|
Consists
of 1,800 shares of
common stock.
|
(37)
|
Consists
of 1,700 shares of
common stock.
|
(38)
|
Consists
of 1,600 shares of common stock.
|
(39)
|
Consists
of 1,500 shares of
common stock.
|
(40)
|
Includes
1,500 shares that may be acquired at $0.85 per share upon exercise
of
warrants.
|
(41)
|
Consists
of 1,100 shares of
common stock.
|
(42)
|
Consists
of 1,000 shares of common stock.
|
(46)
|
Consists
of 900 shares of common stock.
John
Dickey Boardman, Jr. is the Managing Member of A. Boardman Co.
LLC, and, accordingly, may be deemed to share voting and investment
power over shares held by A. Boardman Co. LLC.
|
(44)
|
Consists
of 900 shares of common stock.
|
(45)
|
Consists
of 900 shares of common stock.
|
(46)
|
Consists
of 800 shares of common stock.
|
(47)
|
Consists
of 600 shares of common stock.
|
(48)
|
Consists
of 500 shares of common stock.
|
(49)
|
Consists
of 400 shares of common stock.
|
(50)
|
Consists
of 300 shares of common stock.
|
|
· |
engage
in any stabilization activity in connection with any of the
shares;
|
|
· |
bid
for or purchase any of the shares or any rights to acquire the
shares;
|
|
· |
attempt
to induce any person to purchase any of the shares or rights to acquire
the shares other than as permitted under the Exchange Act; or
|
|
· |
effect
any sale or distribution of the shares until after the prospectus
shall
have been appropriately amended or supplemented, if required, to
describe
the terms of the sale or
distribution.
|
As
of June 30, 2007
|
|
|||
|
Actual(1)
|
|||
Cash
and cash equivalents
|
$
|
475
|
||
Short-Term
Liabilities(2)
|
$
|
1,024,772
|
||
Long-Term
Liabilities(3)
|
$
|
554,893
|
||
Stockholders
Equity (Deficiency)
|
$
|
403,026
|
||
Total
Capitalization(4)
|
$
|
1,982,691 |
(1)
|
Certain
of the shares that are part of this offering have not yet been issued
by
us and are not reflected in this table.
|
(2)
|
Short-term
liabilities consist of current amounts due under notes payable as
well as
interest payable on long-term debt.
|
(3)
|
Long-term
liabilities consist of notes payable to various individuals and other
long-term liabilities.
|
(4)
|
Total
capitalization is stated by not including cash and cash
equivalents.
|
|
· |
formed
our company and established our initial structure;
|
|
· |
sought
and pursued investment opportunities;
|
|
· |
reviewed
and analyzed the potential market for natural spring water;
|
|
· |
purchased
the Mt. Sidney property and procured the necessary financing to cover
the
initial purchase costs from an offering of preferred stock;
|
|
· |
purchased
two properties near the Mt. Sidney property which we are considering
leasing for commercial purposes;
|
|
· |
purchased
trademarks and other intellectual property relating to the creation
and
bottling of flavored and non-flavored bottled water;
|
|
· |
performed
required testing of water quality at spring site;
|
|
· |
began
developing a new web site as part of our marketing strategy;
and
|
|
· |
made
improvements to the spring site and water collection
facilities.
|
|
·
|
stock-based
compensation; and
|
|
|
|
|
·
|
revenue
recognition.
|
Millions
of
|
Annual
|
Millions
of
|
Annual
|
||||||||||
Year
|
Gallons
|
%
Change
|
Dollars
|
%
Change
|
|||||||||
2001
|
5,185.2
|
9.7
|
%
|
$
|
6,880.6
|
12.6
|
%
|
||||||
2002
|
5,795.7
|
11.8
|
%
|
$
|
7,901.4
|
14.8
|
%
|
||||||
2003
|
6,269.8
|
8.2
|
%
|
$
|
8,526.4
|
7.9
|
%
|
||||||
2004
|
6,806.7
|
8.6
|
%
|
$
|
9,169.4
|
7.5
|
%
|
||||||
2005
|
7,537.1
|
10.7
|
%
|
$
|
10,012.5
|
9.2
|
%
|
Gallons
|
Annual
|
||||||
Year
|
Per
Capita
|
%
Change
|
|||||
2001
|
18.8
|
8.7
|
%
|
||||
2002
|
20.9
|
10.7
|
%
|
||||
2003
|
22.4
|
7.3
|
%
|
||||
2004
|
24.0
|
7.6
|
%
|
||||
2005
|
26.1
|
9.6
|
%
|
Non-Sparkling
|
Domestic
Sparkling
|
Imports
|
Total
|
||||||||||||||||||||||
Year
|
Volume*
|
Change
|
Volume*
|
Change
|
Volume*
|
Change
|
Volume*
|
Change
|
|||||||||||||||||
2001
|
4,917.3
|
10.7
|
%
|
144.0
|
-0.1
|
%
|
123.9
|
-10.1
|
%
|
5,185.2
|
9.7
|
%
|
|||||||||||||
2002
|
5,487.5
|
11.6
|
%
|
149.5
|
3.8
|
%
|
158.7
|
28.1
|
%
|
5,795.7
|
11.8
|
%
|
|||||||||||||
2003
|
5,923.9
|
8.0
|
%
|
152.6
|
2.1
|
%
|
193.3
|
21.8
|
%
|
6,269.8
|
8.2
|
%
|
|||||||||||||
2004
|
6,411.3
|
8.2
|
%
|
166.8
|
9.3
|
%
|
228.6
|
18.3
|
%
|
6,806.7
|
8.6
|
%
|
|||||||||||||
2005
|
7,169.5
|
11.8
|
%
|
185.0
|
10.9
|
%
|
182.7
|
-20.1
|
%
|
7,537.1
|
10.7
|
%
|
*
Millions of gallons
|
|||||||||||||||||||||||||
Source:
Beverage Marketing
Corporation
|
|
·
|
Home
Delivery (1 to 5 gallon bottles)
|
|
|
|
|
·
|
Commercial
and Office Delivery (1 to 5 gallon bottles)
|
·
|
Off
Premise Retail (supermarkets, convenience store, and drug
store)
|
·
|
On-Premise
Retail (restaurants)
|
|
·
|
Vending
Machines
|
|
· | Institutional Usage (hospitals, schools) | |
· |
Bulk
Sales (Domestic and International sales of potable
water)
|
|
· |
certain
trademarks, service marks, trade names, service names and
logos;
|
|
· |
various
glass bottle designs;
|
|
· |
bottle
label designs and artwork for water bottle carrypacks;
|
|
· |
formulas
for flavored sparkling water and for teas; and
|
|
· |
web
site coding.
|
Name
|
|
Age
|
|
Position(s)
|
Joel
P. Sens
|
|
42
|
|
Chief
Executive Officer, President, Treasurer, Secretary and
Director
|
Jeffrey
Sens
|
|
42
|
|
Director
|
|
· |
liability
based on a breach of the duty of loyalty to us or our stockholders;
|
|
· |
liability
for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of the law;
|
|
· |
liability
based under Section 174 of Title 8 of the Delaware General Corporation
Law; or
|
|
· |
liability
for transactions from which the director derived an improper personal
benefit.
|
Name
and Principal Position
|
Year
|
Annual
Compensation
|
Long-Term
Compensation
|
All
Other Compensation
|
||||
Salary
($)(1)
|
Bonus
($)
|
Other
Annual Compensation ($)
|
Awards
|
Payouts
|
||||
Restricted
Stock Award(s) ($)
|
Securities
Underlying Options / SARs (#)
|
LTIP
Payouts ($)
|
Joel
Sens, CEO
|
2006
|
180,000
|
0
|
0
|
0
|
0
|
0
|
0
|
2005
|
150,000
|
0
|
0
|
0
|
0
|
0
|
0
|
|
2004
|
90,000
|
0
|
0
|
0
|
0
|
0
|
0
|
(1)
|
October
2000 employment agreements, contracting for $140,000 per year, with
Darryl
Reed, the former president of our predecessor company, Pre-Settlement
Funding Corporation, and Joel Sens, were renegotiated during 2003
and no
compensation other than the $90,000 paid to Joel Sens in October
2004,
described above, has been paid.
|
Name
|
Shares
Acquired on Exercise (#)
|
Value
Realized ($)
|
Number
of Securities Underlying Unexercised Options/SARs At FY-End (#)
Exercisable / Unexercisable
|
Value
of Unexercised In-The-Money Options/SARs At FY-End (#) Exercisable
/
Unexercisable
|
Joel
Sens, CEO
|
0
|
0
|
1,500,000/0
|
$0(1)/$0
|
|
·
|
400,000
shares of our common stock at $0.50 per share;
|
|
|
|
|
·
|
300,000
shares of our common stock at $1.00 per share;
|
|
|
|
|
·
|
300,000
shares of our common stock at $1.75 per share; and
|
|
|
|
|
·
|
500,000
shares of our common stock at $2.00 per
share.
|
Fiscal
Year Ended
December
31, 2007
|
|||||||
High($)*
|
Low($)*
|
||||||
Second
Quarter
|
2.45
|
0.96
|
|||||
First
Quarter
|
1.20
|
0.40
|
Fiscal
Year Ended
December
31, 2006
|
|||||||
High($)*
|
Low($)*
|
||||||
Fourth
Quarter
|
0.75
|
0.40
|
|||||
Third
Quarter
|
1.00
|
0.60
|
|||||
Second
Quarter
|
1.50
|
0.60
|
|||||
First
Quarter
|
0.75 | 0.45 |
Fiscal
Year Ended
December
31, 2005
|
|||||||
High($)*
|
Low($)*
|
||||||
Fourth
Quarter
|
1.05
|
0.40
|
|||||
Third
Quarter
|
0.85
|
0.70
|
|||||
Second
Quarter
|
1.00
|
0.65
|
|||||
First
Quarter
|
1.05
|
0.40
|
Fiscal
Year Ended
December
31, 2004
|
|||||||
High($)*
|
Low($)*
|
||||||
Fourth
Quarter
|
1.05
|
0.90
|
|||||
Third
Quarter
|
1.10
|
0.44
|
|||||
Second
Quarter
|
1.50
|
0.44
|
|||||
First
Quarter(1)
|
1.25
|
0.16
|
(1)
|
Data
for the first quarter of 2004 is for the period January 9, 2004,
the date
our common stock began trading on the OTCBB, through March 31,
2004.
|
(i)
|
All
compensation plans (including individual compensation arrangements)
previously approved by our stockholders; and
|
(ii)
|
All
compensation plans (including individual compensation arrangements)
not
previously approved by our
stockholders.
|
EQUITY
COMPENSATION PLAN INFORMATION
|
||||||||||
|
Number
of securities to be
issued
upon exercise of
outstanding
options, warrants
and
rights (a)
|
Weighted-average
exercise
price
of outstanding options,
warrants
and rights (b)
|
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in column (a))
(c)
|
|||||||
Equity
compensation plans approved by stockholders
|
0
|
0
|
0
|
|||||||
Equity
compensation plans not approved by stockholders
|
1,500,000
|
$
|
1.35/share
|