SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
September 5, 2003
-----------------
Date of Report
(Date of Earliest Event Reported)
PIEZO INSTRUMENTS, INC.
-----------------------
(Exact Name of Registrant as Specified in its Charter)
Utah 0-26177 87-0425275
---- ------- ----------
(State or other (Commission File No.) (IRS Employer I.D. No.)
Jurisdiction)
1107 Mt. Rushmore Road, Suite 2
Rapid City, South Dakota 57701
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(Address of Principal Executive Offices)
(605) 718-0380
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Registrant's Telephone Number
4685 South Highland Drive, #202
Salt Lake City, Utah 84117
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(Former Name or Former Address if changed Since Last Report)
Item 1. Changes in Control of Registrant.
---------------------------------
(a) Effective as of September 5, 2003, the Registrant ("Piezo "); Omni
Medical of Nevada, Inc., a Nevada corporation ("Omni"), and the stockholders
of Omni (the "Omni Stockholders"), executed an Agreement and Plan of
Reorganization (the "Reorganization Agreement"), whereby Piezo agreed to
acquire 100% of the issued and outstanding shares of common stock of Omni in
exchange for 16,000,000 post-split shares of common stock of Piezo, or
approximately 88.8% of the post-Reorganization Agreement outstanding
securities of Piezo.
At the closing, and excluding the securities to be exchanged for the Omni
Shares, the outstanding common stock of Piezo amounted to approximately
2,000,000 shares or approximately 11.1% of the post-Reorganization Agreement
outstanding common stock of Piezo, after taking into account (i) a reverse
split on the basis of one for 14.5 shares owned of the outstanding common
stock of Piezo; (ii) the issuance of an option to acquire 225,000 post-split
shares of "restricted securities" (common stock) of Piezo; (iii) the
cancellation of 1,466,379 post-split shares of common stock of Piezo that were
held by certain principal stockholders of Piezo, that included the 225,000
post-split shares of common stock underlying the option in the preceding
subparagraph; (iv) the issuance of an aggregate of 500,000 post-split newly
issued shares of "restricted securities" (common stock) of Piezo in
consideration of the cancellation of such shares and the option referenced in
the two preceding subparagraphs and the waiver by the canceling stockholders
of any registration rights that had been granted to them or were applicable to
any of the cancelled shares or the option; and (v) the issuance of (or the
agreement to issue) an aggregate of 293,104 shares of common stock of Piezo
for and in consideration of non-capital raising services to be rendered
pursuant to a written Consulting Agreement during the period that will
commence on the closing and shall be effective for a period of six months
thereafter, and which shares shall be registered on Form S-8 of the Securities
and Exchange Commission promptly after the closing when the reorganized Piezo
is deemed to be "current" in the filing of all Reports that were required to
be filed by it with the Securities and Exchange Commission for the preceding
12 month period.
At the closing, Piezo acquired the shares of the majority stockholders of
Omni and exchanged 9,053,811 shares of the 16,000,000 shares to be issued to
the Omni Stockholders pursuant to the Reorganization Agreement, resulting in
Omni becoming a majority-owned subsidiary of Piezo on closing. Piezo will
attempt to complete the acquisition of the remaining shares of Omni within the
next thirty (30) days.
Accordingly, and assuming all of the Omni Stockholders become party to
the Reorganization Agreement, there will be 18,000,000 post-Reorganization
Agreement outstanding shares of common stock of the reorganized Piezo.
The combination of these entities was treated as a purchase for
accounting purposes, with Omni becoming a wholly-owned subsidiary of Piezo on
completion of the acquisition of the remaining shares of Omni.
By virtue of (i) the percentage of Piezo acquired under the
Reorganization Agreement by the Omni Stockholders; and (ii) the provisions of
the Reorganization Agreement that provided for the election of the current
officers and directors of Omni to the Board of Directors of Piezo, this
Reorganization Agreement may be deemed to have involved a "change of control."
The source of the consideration used by the Omni Stockholders to acquire
their interest in Piezo will be the exchange of their respective shares of the
outstanding securities of Omni.
The primary basis of the "control" by the Omni Stockholders is stock
ownership.
The principal terms of the Reorganization Agreement were:
1. Prior to the completion of the Reorganization Agreement, Piezo was
required to have effected a reverse split of its outstanding common stock on
the basis of one share for 14.5 shares owned, which became effective on the
opening of business on August 25, 2003. All computations herein take into
account this reverse split.
2. In consideration of the closing of the Reorganization Agreement,
certain principal stockholders of Piezo (i) delivered 1,466,379 post-split
shares of Piezo for cancellation to its treasury, which included 225,000 post-
split shares of common stock underlying an option granted to one of the
canceling stockholders; and (ii) waived any registration rights that had been
granted to them or were applicable to any of the cancelled shares. In
exchange for the cancellation of these shares and the waiver of any
registration rights, Piezo issued an aggregate of 500,000 post-split newly
issued shares of "restricted securities" to the canceling stockholders.
3. The issuance of 9,053,811 shares of common stock ("restricted
securities") of Piezo at closing in exchange for a majority of the outstanding
shares of Omni. The acquisition of the remaining shares of Omni will be
completed as soon as possible. Following the acquisition of all of the shares
of Omni, the 16,000,000 shares of Piezo to be exchanged pursuant to the
Reorganization Agreement will represent approximately 88.8% of the post-
Reorganization Agreement outstanding common stock of Piezo.
4. As a condition of the closing, certain principal stockholders of
Piezo executed and delivered to Piezo a Lock-Up/Leak-Out Agreement that covers
shares of common stock of Piezo owned by them or acquired by them pursuant to
the Reorganization Agreement. The Lock-Up/Leak-Out Agreement shares includes
the 500,000 shares of newly issued "restricted securities" referenced in
paragraph 2 above, and the 293,104 shares referenced in paragraph 5 below,
along with approximately 371,340 additional securities of Peizo that were
owned by such principal stockholders prior to the closing of the
Reorganization Agreement. Pursuant to the terms of the Lock-Up/Leak-Out
Agreement, these stockholders will collectively be allowed to sell 1% of the
outstanding securities of Piezo in the aggregate during any three month period
for a period of 12 months from the closing of the Reorganization Agreement,
and all are required to be made in "broker's transactions" as that term is
defined in Rule 144 of the Securities and Exchange Commission. Piezo has
adequate measures in place to ensure compliance with the Lock-Up/Leak-Out
Agreement.
5. The reorganized Piezo adopted and ratified a Consulting Agreement and
the issuance of an aggregate of 293,104 shares of common stock of Piezo in
consideration of non-capital raising services to be rendered for a period of
six months following the closing of the Reorganization Agreement and which
such shares shall be registered on Form S-8 of the Securities and Exchange
Commission as soon as practicable after the closing of the Reorganization
Agreement when the reorganized Piezo is deemed to be "current" in the filing
of all reports that were required to be filed by it with the Securities and
Exchange Commission for the preceding 12 month period. The closing of the
Reorganization Agreement may be deemed to be a "back door" registration of
Omni's securities under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), which requires that this Current Report substantially contain
the type of information that would have been contained in a 10-SB Registration
Statement had Omni filed such a registration statement with the Securities and
Exchange Commission, including audited financial statements of Omni and an
unaudited pro forma balance sheet and income statement that takes into account
the closing of the Reorganization Agreement. This Current Report is prepared
to comply with the Securities and Exchange Commission's pronouncements
respecting "back door" registrations; however, the current audited financial
statements of Omni for the years ended March 31, 2003 and 2002, and the
required pro forma financial statements at March 31, 2003, will not be
available for approximately 10 days, and then, such financial statements will
be filed with the Securities and Exchange Commission as an amendment to this
Current Report. Piezo will also be promptly required to file reviewed
financial statements of Omni for the quarter ended June 30, 2003, together
with pro forma financial statements at such date that take into account the
closing of the Reorganization Agreement. Piezo intends to notify the
Securities and Exchange Commission of the potential applicability of its "back
door" pronouncements to the Reorganization Agreement and this Current Report
when all such information has been filed, and the Securities and Exchange
Commission will either have substantive comments that must be satisfied by
Piezo prior to it being determined to be "current" in the filing requirements
to which it is subject under the Exchange Act, or it will advise Piezo that it
has no comments, at which time Piezo would be deemed to be "current" and in
compliance with its required filing requirements, so long as all other
Exchange Act reports subsequently required to be filed by it had been filed.
Piezo was believed to be in compliance with all filing requirements of the
Exchange Act prior to the completion of the Reorganization Agreement.
6. Following the closing of the Reorganization Agreement, Piezo will
provide its stockholders with an information statement to consider and act
upon an amendment to Piezo's Articles of Incorporation to change its name to
"Omni Medical Holdings, Inc." and that in the interim, Piezo filed a dba in
the State of Utah to conduct business under that name and obtained a new Cusip
Number and OTC Bulletin Board Symbol for such name. A Preliminary Information
Statement respecting the name change only was filed by Piezo with the
Securities and Exchange Commission on September 17, 2003, that had a
stockholder mailing date of September 29, 2003, and a planned effective date
of the name change of October 20, 2003, depending upon satisfying any comments
posed by the Securities and Exchange Commission; this Preliminary Information
Statement will be amended on September 23, 2003, to include the right of
Piezo's stockholders to take action without a meeting in accordance with the
1992 amendments to the Utah Revised Business Corporation Act, and to remove
the requirement of the Board of Directors contained in its Articles of
Incorporation to approve transfers of its authorized securities. The
amendment extends the mailing date to October 3, 2003, and sets a meeting of
the stockholders to consider the proposed amendments on October 13, 2003. The
Preliminary Information Statement, as amended, is incorporated herein by
reference. See Item 7.
7. The designation of the directors and executive officers nominated by
the Omni Stockholders as directors and executive officers of Piezo, with the
resignation of the pre-Reorganization Agreement directors and executive
officers, in seriatim.
Prior to the completion of the Reorganization Agreement, and taking into
account the one for 14.5 reverse split and the cancellation of the 1,466,379
post-split shares owned by certain principal stockholders, there were
1,207,038 outstanding shares of Piezo's common stock. Following the closing,
and taking into account the issuance of the 500,000 "restricted" securities
referenced in paragraph 2 above in consideration of the cancellation of the
above referenced shares, the issuance of 293,104 shares referenced in
paragraph 5 pursuant to the Consulting Agreement to be registered on Form S-8,
and the acquisition of the remaining shares of Omni, there will be 18,000,000
shares of the reorganized Piezo issued and outstanding.
A copy of the Reorganization Agreement, including all material exhibits
and related instruments, accompanies this Current Report, which, by this
reference, is incorporated herein; the foregoing summary is modified in its
entirety by such reference. See Item 7, Exhibit 2.
(b)(i) To the knowledge of management and based upon a review of the
stock ledger maintained by Piezo's transfer agent and registrar, the following
table sets forth the beneficial ownership of persons who owned more than five
percent of Piezo's common stock prior to the closing of the Reorganization
Agreement, and the share holdings of the then members of management:
Name Positions Held Shares Owned %
---- -------------- ------------ ---
Thomas J. Howells President and -0- 0
Director
Kathleen L. Morrison Vice President -0- 0
and Director
Travis T. Jenson Secretary/Treasurer -0- 0
and Director
Jenson Services, Inc. Stockholder 1,241,380 50.7%
Ralph M. and Stockholders 287,672* 11.7%
Shirley Wilkerson
Totals: 1,529,052 62.4%
* These shares include 34,622 shares held in the name of W-Group,
an entity controlled by Ralph M. And Shirley Wilkerson; and
20,695 shares held in the name of Eadac Investments Ltd., an
entity controlled by Ralph M. And Shirley Wilkerson.
(b)(ii) To the knowledge of management and based upon a review of the
stock ledger maintained by Piezo's transfer agent and registrar, the
following table sets forth the beneficial ownership of persons who owned more
than five percent of Piezo's common stock following the closing of
the Reorganization Agreement, and the share holdings of the new members of
management:
Name Positions Held Shares Owned %(1)
---- -------------- ------------- ----
Arthur D. Lyons President, CEO, 1,668,937 15.5%
Secretary and
Director
Charles D. Arbeiter COO, Treasurer 1,835,852 17.1%
and Director
Al Rieman Stockholder 2,503,301 23.3%
LHM Trading (2) Stockholder 3,045,721 28.3%
Totals: 9,053,811 84.1%
(1) Excludes the 294,103 shares that are to be issued under the
Consulting Agreement referenced in paragraph 5 above as they
cannot be issued until Piezo is determined to be "current" in
the filing of all reports that are required to have been filed
by it under the Exchange Act with the Securities and Exchange
Commission during the past 12 months, and is therefore based
upon 10,760,849 outstanding shares.
(2) LHM Trading is controlled by Arthur D. Lyons, the President,
CEO, Secretary and a Director of Piezo.
Item 2. Acquisition or Disposition of Assets.
-------------------------------------
(a) See Item 1.
The consideration exchanged under the Reorganization Agreement was
negotiated at "arms length," and the directors of Piezo used criteria used in
similar uncompleted proposals involving Piezo in the past, including the
relative value of the assets of Piezo in comparison to those of Omni; Omni's
present and past business operations; the future potential of Omni; its
management; and the potential benefit to the stockholders of Piezo. The
directors determined that the consideration for the exchange was reasonable,
under these circumstances.
No director, executive officer or five percent or more stockholder of
Piezo had any direct or indirect interest in Omni or the Omni
Stockholders prior to the completion of the Reorganization Agreement;
similarly, no nominee to become a director or any Omni Stockholder or any
beneficial owner of any Omni Stockholder had any interest in Piezo prior to
the closing of the Reorganization Agreement.
(b) Piezo is a successor to and intends to continue the business
operations intended to be conducted by Omni. All references to "Omni" below
take into account information, where applicable, of its predecessors.
References to "Piezo," where applicable, also include Omni as its majority-
owed subsidiary.
Part I
Organization and Business Development and Business.
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Organization and Business Development.
--------------------------------------
References to the "Company," "our," "we," "us" and words of similar
import refer to Piezo, Omni or the combined Piezo and its majority-owned
subsidiary, Omni, as applicable.
Piezo.
------
For information regarding the organization and business development of
Piezo through December 31, 2002, see Part I, Item 1, of its 10-KSB Annual
Report for the year ended December 31, 2002, which was filed with the
Securities and Exchange Commission on March 26, 2003, and is incorporated
herein by reference. See Item 7.
Piezo effected a reverse split of its outstanding common stock on the
basis of one share for 14.5 shares owned, which became effective on the
opening of business on August 25, 2003.
On September 5, 2003, the Omni Stockholders outlined in Item (b)(ii)
above executed and delivered the Reorganization Agreement with Piezo pursuant
to which Omni became a majority-owned subsidiary of Piezo.
Piezo filed a "dba" with the State of Utah, its state of incorporation,
on September 5, 2003, to do business under the name "Omni Medical Holdings,
Inc., and immediately prior to this filing, Omni changed its name to "Omni
Medical of Nevada, Inc."
Piezo filed a Preliminary Information Statement to effect a name change
with the Securities and Exchange Commission on September 17, 2003, that had a
stockholder mailing date of September 29, 2003, and a planned effective date
of a name change to "Omni Medical Holdings, Inc." of October 20, 2003,
depending upon satisfying any comments posed by the Securities and Exchange
Commission. This Preliminary Information Statement will amended on September
23, 2003, to include the right of Piezo's stockholders to take action without
a meeting in accordance with the 1992 amendments to the Utah Revised Business
Corporation Act, and to remove the requirement of the Board of Directors
contained in its Articles of Incorporation to approve transfers of its
authorized securities. The amendment extends the mailing date to October 3,
2003, and sets a meeting of the stockholders to consider the proposed
amendments on October 13, 2003.
Omni.
-----
Omni was organized under the laws of the State of South Dakota in August,
1994, under the name "Mastel Precision, Inc."
On April 15, 2002, Omni entered into an Agreement for the Exchange of
Common Stock (the "Daycor Agreement") with Daycor Corporation, a Nevada
Corporation ("Daycor"), pursuant to which the stockholders of Omni
respectively exchanged 100% of the outstanding securities of Omni for
11,000,000 shares of Daycor "restricted securities" (common stock). Daycor
was organized in the State of Nevada in 1998, and had no principal operations
at the time of the closing of the Daycor Agreement; it had effected a limited
offering of its securities pursuant to Rule 504 of Regulation D of the
Securities and Exchange Commission in May, 1998, and had approximately 100
stockholders from that offering who had represented that they were "accredited
investors" as that term is defined in Regulation D.
Effective July 10, 2002, Omni entered into an Asset Purchase Agreement
with A&V Digital Transcription Services ("A&V"), a general partnership engaged
in the medical transcription market that was based in the State of Alabama.
On September 4, 2002, Omni formed Mastel Precision Health Information
Services, Inc. as a wholly-owned subsidiary in the State of South Dakota
("MPHI"), to operate the transcription services business acquired from A&V.
Effective May 2, 2003, Omni exchanged 100% of the common stock of MPSI,
its wholly-owned subsidiary, and $36,000 in cash for all of the common stock
of Omni owned individually or jointly by one of Omni's officer's, Doug Mastel,
and his wife. As a result of this exchange, the officer assumed all
obligations and liabilities of MPSI, in addition to acquiring all of its all
assets. MPSI's net losses for the years ended March 31, 2003 and 2002, were
$375,110 and $186,720, respectively.
On May 31, 2003, Omni acquired Medical Billing Management ("MBM").
On September 5, 2003, the Omni Stockholders outlined in Item (b)(ii)
above executed and delivered the Reorganization Agreement with Piezo pursuant
to which Omni became a majority-owned subsidiary of Piezo.
Business.
---------
Piezo engaged in engineering, research, development and merchandising of
electronic and electronic and electromechanical devices, equipment, and
accessories until 1987; these activities were unsuccessful and it ceased
active operations in 1987.
Omni is a medical service company providing transcription, billing and
collection services to healthcare providers throughout the United States.
Based in Rapid City, South Dakota, Omni currently has offices in three states
with approximately 30 full and part-time employees. Growth plans include both
additional acquisitions in various medical service areas, as well as internal
sales growth.
Principal Products or Services and Their Markets.
-------------------------------------------------
Omni provides medical transcription service to hospitals and healthcare
facilities currently in Alabama and South Dakota. Whenever a health care
provider makes a diagnosis or provides a patient treatment, those actions must
be documented. Government and insurance regulations are such that these
important medical records, which affect patient health, must be in readable
form. This results in the health care provider dictating the patient
treatment in some form and someone else typing that dictation. Due to the
obvious importance of this task, a transcriptionist must have a level of
training well beyond a normal typist. This would include detailed knowledge
of medical terminology and working knowledge of heath and science principles
in a variety of medical disciplines. Transcription has become an important
and essential service in all healthcare practices. Clients are usually
charged a line rate of $0.11 - $0.18, depending on the work involved.
Transcriptionists are usually hired on a subcontract basis, work out their
home and are compensated on a per line basis. Quality assurance and other
management personnel are full-time employees, provide services at the
corporate office and are compensated on a salary basis.
Omni also provides medical billing and collections services in the State
of Mississippi. Medical billing and collections are the lifeblood of any
healthcare facility. Accurate and timely collections insure an efficient
practice and high standard of care.
Omni is currently operating in three states. The market, however, can
encompass the entire country made possible through the electronic transfer of
data. It is the intention of Omni Medical to focus its marketing efforts on
mid-size metropolitan cities throughout the United States. Its expansion and
acquisition strategies will position Omni to become a nationwide provider of
medical services.
Distribution Methods of the Products or Services.
-------------------------------------------------
The finished product (e.g., transcribed lines) is distributed digitally
through electronic transmission to the client. Medical billings are either
mailed or sent electronically first to the insurance companies. The patient
is then billed for any difference that was not received from their insurance
company. Insurance company and patient payments are remitted to a banking
institution lockbox designated under the doctor's name or healthcare facility.
Collections activities involve following up with either the insurance
companies or patient for any payment not yet received within a designated
amount of time.
Status of any Publicly Announced New Product or Service.
--------------------------------------------------------
None; not applicable.
Competitive Business Conditions.
--------------------------------
Healthcare services (e.g., transcription, billing, collections) is a
highly fragmented industry. Two of our largest competitors are Medquist, Inc.
("MEDQ") and IDX Systems Corporation ("IDXC"), both of which are large and
well funded publicly traded companies, with substantially more assets and
resources that Omni. The primary competition comes from the healthcare
facility itself. Due to the overhead expense of providing these services
internally, more healthcare facilities will be looking to outsource these
duties to reduce costs.
Transcription has become an important and essential service in all
healthcare practices. According to the "MTIA," (a transcription trade
association), medical transcription is a fragmented $15 billion industry, with
revenues projected to approach $25 billion over the next five years.
Medical billing and collections are the lifeblood of any healthcare
facility. Accurate and timely collections ensure an efficient practice and
high standard of care. Although no industry figures are available, it is
known that approximately $1.5 trillion was spent on health care in the United
States last year. Assuming that half of that amount occurred at the point of
care, that would be a potential billing market of $750 billion. Health care
providers that use billing services generally pay between 6-10% of the amount
collected on their behalf. This would put the potential estimated revenue for
billing services somewhere between $45-75 billion, and growing at a rate of 8%
annually. With the rising cost of health care and an aging population, in
five years the market could well be generating over $100 billion in annual
revenue. Within the billing industry, there are generally no subcontractors,
and all work from the corporate office.
According to United State Government studies, the medical industry is
growing at a rate of 8% annually, with estimates as high as 12% in the coming
years. The need for medical services by healthcare providers will continue to
mirror that growth rate. It is widely known that an increasingly aging
population, along with a country that will spare no expense for personal
consumption of medical care, will contribute to this growth. Healthcare
providers will also remain under pressure to reduce operating expense and
expand margins. The effect is that services currently provided internally
will now be more readily outsourced. The outsourcing trend allows the health
care provider to focus time and resources on providing health care, giving the
opportunity for growth potential to medical service providers like Omni.
Sources and Availability of Raw Materials and Names of Principal
Suppliers.
----------
None; not applicable.
Dependence on One or a Few Major Customers.
-------------------------------------------
None; not applicable.
Patents, Trademarks, Licenses, Franchises, Concessions, Royalty
Agreements or Labor Contracts.
------------------------------
None; not applicable.
Need for any Governmental Approval of Principal Products or Services.
---------------------------------------------------------------------
Government regulations concerning the privacy of patient's health records
are being phased in at this time. Known as "HIPPA," the effects of these
regulations have been for all healthcare providers and vendors to upgrade both
security and technology of patient records. For Omni as a vendor, it is
compliant with HIPPA regulations and believes these regulations will only
encourage healthcare providers to outsource more medical services.
Effect of Existing or Probable Governmental Regulations on Business.
--------------------------------------------------------------------
The integrated disclosure system for small business issuers adopted by
the Securities and Exchange Commission in Release No. 34-30968 and effective
as of August 13, 1992, substantially modified the information and financial
requirements of a "Small Business Issuer," defined to be an issuer that has
revenues of less than $25 million; is a U.S. or Canadian issuer; is not an
investment company; and if a majority-owned subsidiary, the parent is also a
small business issuer; provided, however, an entity is not a small business
issuer if it has a public float (the aggregate market value of the issuer's
outstanding securities held by non- affiliates) of $25 million or more.
The Securities and Exchange Commission, state securities commissions and
the North American Securities Administrators Association, Inc. ("NASAA") have
expressed an interest in adopting policies that will streamline the
registration process and make it easier for a small business issuer to have
access to the public capital markets. The present laws, rules and regulations
designed to promote availability to the small business issuer of these capital
markets and similar laws, rules and regulations that may be adopted in the
future will substantially limit the demand for "blank check" companies like
our Company, and may make the use of these companies obsolete.
We are also subject to the Sarbanes-Oxley Act of 2002. This Act creates
a strong and independent accounting oversight board to oversee the conduct of
auditors of public companies and strengthens auditor independence. It also
requires steps to enhance the direct responsibility of senior members of
management for financial reporting and for the quality of financial
disclosures made by public companies; establishes clear statutory rules to
limit, and to expose to public view, possible conflicts of interest affecting
securities analysts; creates guidelines for audit committee members'
appointment, compensation and oversight of the work of public companies'
auditors; prohibits certain insider trading during pension bund blackout
periods; and establishes a federal crime of securities fraud, among other
provisions.
Research and Development.
-------------------------
None; not applicable.
Cost and Effects of Compliance with Environmental Laws.
-------------------------------------------------------
None; not applicable.
Number of Employees.
--------------------
Our Company currently employs 29 employees, of which 25 are full-time.
Management's Discussion and Analysis or Plan of Operation.
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Forward-looking Statement.
--------------------------
Statements made in this Form 8-K Current Report which are not purely
historical are forward-looking statements with respect to the goals, plan
objectives, intentions, expectations, financial condition, results of
operations, future performance and business of our Company, including, without
limitation, (i) our ability to raise capital, and (ii) statements preceded by,
followed by or that include the words "may", "would", "could", "should",
"expects", "projects", "anticipates", "believes", "estimates", "plans",
"intends", "targets" or similar expressions.
Forward-looking statements involve inherent risks and uncertainties, and
important factors (many of which are beyond our Company's control) that could
cause actual results to differ materially from those set forth in the
forward-looking statements, including the following, general economic or
industry conditions, nationally and/or in the communities in which our Company
conducts business, changes in the interest rate environment, legislation or
regulatory requirements, conditions of the securities markets, our ability to
raise capital, changes in accounting principles, policies or guidelines,
financial or political instability, acts of war or terrorism, other economic,
competitive, governmental, regulatory and technical factors affecting our
Company's operations, products, services and prices.
Accordingly, results actually achieved may differ materially from
expected results in these statements. Forward-looking statements speak only
as of the date they are made. Our Company does not undertake, and
specifically disclaims, any obligation to update any forward-looking
statements to reflect events or circumstances occurring after the date of such
statements.
Plan of Operations.
-------------------
The past two fiscal years have been difficult ones financially for Omni
due primarily to the operations MPSI. While MPSI had bright future prospects,
the past three years were a tremendous drain on Omni. Omni managed to
continue operations by raising capital and reducing expenses. In April 2003,
the management determined that the best course of action would be to privately
spin-off MPSI and focus on the medical service area. This area includes
medical transcription and billing and is characterized by positive cash flow,
good operating margins, low debt and no inventory or Research and development
costs. On May 2, 2003, the spin-off was completed to a former director and
executive officer (see the heading "Organization and Business Development" of
the caption "Organization and Business Development and Business," above) and
on May 31, 2003, Omni acquired MBM. MBM's long, profitable operating history
and consistent revenue make it a significant acquisition. As Omni management
undertakes an ongoing acquisition strategy in this area, it believes that the
Company's future is very positive. Omni Cash flow is now positive, its debt
is at a low level and its revenue is higher than it has been in over two
years.
Description of Property.
------------------------
Omni has an interest in three parcels of real property: 1609 West
Street, Montgomery, Alabama, that it is purchasing; 1867 Crane Ridge Drive,
Suite #250-A, Jackson, Mississippi, and 1107 Mt. Rushmore Road, Suite 2, Rapid
City, South Dakota, both of which are leased.
Security Ownership of Certain Beneficial Owners and Management.
---------------------------------------------------------------
The following table sets forth certain information as of September
22, 2003, regarding current beneficial ownership of the shares of our common
stock by (i) each person known by us to own more than 5% of the outstanding
shares of our common stock, (ii) each of our executive officers and directors,
and (iii) all of our executive officers and directors as a group. Except as
noted, each person has sole voting and sole investment or dispositive power
with respect to the shares shown. The information presented is based upon
10,760,849 outstanding shares of common stock.
Name Positions Held Shares Owned %
---- -------------- ------------
Arthur D. Lyons President, CEO, 1,668,937 15.5%
Secretary and
Director
Charles D. Arbeiter COO, Treasurer 1,835,852 17.1%
and Director
Al Rieman Stockholder 2,503,301 23.3%
LHM Trading* Stockholder 3,045,721 28.3%
Totals: 9,053,811 84.1%
All executive officers and directors 6,550,510 60.9%
of the Company as a group (2 persons)
* LHM Trading is a business entity controlled by Arthur D. Lyons,
the President, CEO, Secretary and a Director of our Company.
Contractual Arrangements Regarding Changes in Control.
------------------------------------------------------
See Item 1 of this Current Report, above.
Directors and Executive Officers, Promoters and Control Persons.
----------------------------------------------------------------
Identify of directors and Executive Officers.
---------------------------------------------
The following delineates certain information concerning our newly
designated directors and executive officers:
Positions
Positions with with
Name Age the Company Omni
---- --- ----------- ----------
Arthur D. Lyons 45 President, CEO, President, CEO,
Secretary and Secretary and
Director Director
Charles D. Arbeiter 43 COO, Treasurer COO, Treasurer
and Director and Director
Directors are elected by our stockholders to serve until the next
annual meeting of our stockholders or until their successors have been elected
and have duly qualified. Officers are appointed to serve until the annual
meeting of our Board of Directors following the next annual meeting of our
stockholders and until their successors have been elected and have qualified.
The following is a summary of the business experience of each of our
current directors and executive officers:
Arthur D. Lyons. Since 1980, Mr. Lyons has held positions with
Merrill Lynch, E.F. Hutton, Prudential Securities and PaineWebber as
investment representative, pension consultant, trader and portfolio manager.
In 1999, Mr. Lyons formed LHM Trading, an investment firm, and in 2000,
founded Interstate Advisors, Inc., a registered investment advisor. Mr.
Lyons' broad financial experience has provided him with a solid background in
the financial and investment fields. He holds a B.A. Degree in sociology with
a minor in accounting from Samford University in Birmingham, Alabama, in 1979.
Charles D. Arbeiter. Mr. Arbeiter has worked for American Express
and Financial Network as a senior manager providing financial advice to
individuals, corporate clients and banks. He has been active in the financial
services industry since 1985 as a certified financial planner, district
manager and registered investment advisor. He is currently responsible for a
15 member financial planning practice in Rapid City, South Dakota, and is
active in both civic and professional organizations. He is a 1982 graduate of
Sioux Falls (SD) College with a B.S. Degree in business.
Family Relationships.
---------------------
There are no family relationships between Mr. Lyons and Mr. Arbeiter.
Pending Legal Proceedings.
--------------------------
To the knowledge of our management, no director or executive officer is
party to any action in which any has an interest adverse to us.
Involvement in Certain Legal Proceedings.
-----------------------------------------
To the knowledge of our management and during the past 10 years, no
present or former director, person nominated to become a director, executive
officer, promoter or control person of our Company:
(1) Was a general partner or executive officer of any business
by or against which any bankruptcy petition was filed,
whether at the time of such filing or two years prior
thereto;
(2) Was convicted in a criminal proceeding or named the subject
of a pending criminal proceeding (excluding traffic
violations and other minor offenses);
(3) Was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining
him from or otherwise limiting, the following activities:
(i) Acting as a futures commission merchant, introducing
broker, commodity trading advisor, commodity pool
operator, floor broker, leverage transaction merchant,
associated person of any of the foregoing, or as an
investment adviser, underwriter, broker or dealer in
securities, or as an affiliated person, director or
employee of any investment company, bank, savings and
loan association or insurance company, or engaging in
or continuing any conduct or practice in connection
with such activity;
(ii) Engaging in any type of business practice; or
(iii) Engaging in any activity in connection with the
purchase or sale of any security or commodity or
in connection with any violation of federal or
state securities laws or federal commodities
laws;
(4) Was the subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated, of any federal
or state authority barring, suspending or otherwise limiting
for more than 60 days the right of such person to engage in
any activity described above under this Item, or to be
associated with persons engaged in any such activity;
(5) Was found by a court of competent jurisdiction in a civil
action or by the Securities and Exchange Commission to have
violated any federal or state securities law, and the
judgment in such civil action or finding by the Securities
and Exchange Commission has not been subsequently reversed,
suspended, or vacated; or
(6) Was found by a court of competent jurisdiction in a civil
action or by the Commodity Futures Trading Commission to
have violated any federal commodities law, and the judgment
in such civil action or finding by the Commodity Futures
Trading Commission has not been subsequently reversed,
suspended or vacated.
Executive Compensation.
-----------------------
The following table sets forth the aggregate compensation paid by the
Company for services rendered during the periods indicated:
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards Payouts
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Secur-
ities All
Name and Year or Other Rest- Under- LTIP Other
Period Salary Bonus Annual ricte dlying Pay- Comp-
Position Ended ($) ($) Compen- Stock Options outs ensat'n
---------------------------------------------------------------------
Arthur D.
Lyons
President, 6/30/03 6000* 0 0 0 17777* 0 2200*
CEO,
Secretary
Director
Charles D. 6/30/03 0 0 0 0 8889* 0 0
Arbeiter
COO, Treas.,
Director
Thomas J. 3/31/03 0 0 0 0 0 0 0
Howells 12/31/02 0 0 0 0 0 0 0
prior
President,
Director
Kathleen L. 3/31/03 0 0 0 0 0 0 0
Morrison 12/31/02 0 0 0 0 0 0 0
Prior
Vice Pres.,
and Director
Travis T. 3/31/03 0 0 0 0 0 0 0
Jenson 12/31/02 0 0 0 0 0 0 0
Prior
Sec., Tres.,
and Director
Gene 3/31/03 0 0 0 0 0 0 0
Yamamoto 12/31/02 0 0 0 0 0 0 0
Prior
President,
Director
Yujiro 3/31/03 0 0 0 0 0 0 0
Yamamoto 12/31/02 0 0 0 0 0 0 0
Prior 12/31/01 0 0 0 0 0 0 0
President 12/31/00 0 0 0 0 0 0 0
Director
Buck 3/31/03 0 0 0 0 0 0 0
Wilkerson 12/31/02 0 0 0 0 0 0 0
Secretary 12/31/01 0 0 0 0 0 0 0
Treasurer, 12/31/00 0 0 0 0 0 0 0
Director
Valerie 3/31/03 0 0 0 0 0 0 0
Keating, 12/31/02 0 0 0 0 0 0 0
Director 12/31/01 0 0 0 0 0 0 0
12/31/00 0 0 0 0 0 0 0
* Received from Omni.
None of our present directors and executive officers have received
any cash or other remuneration for services rendered to us; and no
compensatory arrangements have yet been set for service in these capacities.
We do not have any stock option, bonus, profit sharing, pension or
similar plan; however, we may adopt such a plan in the future to attract
and/or retain members of management or key employees.
Compliance with Section 16(a) of the Exchange Act.
--------------------------------------------------
All reports required to be filed pursuant to Section 16(a) of the
Exchange Act have been or will be timely filed.
Audit, Nominating and Compensation Committees.
----------------------------------------------
We have no audit, nominating or compensation committees.
Certain Relationships and Related Transactions.
-----------------------------------------------
Transactions with Management and Others.
----------------------------------------
During the years ended March 31, 2003 and 2002,Omni transferred inventory
with a carrying value of approximately $20,000 and $25,000, respectively, to
an officer and shareholder of Omni in exchange for a receivable. The
shareholder used the inventory for promotional and other sales purposes on
behalf of Omni. Omni entered into an agreement with the officer and
shareholder whereby the receivable was settled in exchange for 32,944 shares
of treasury stock, which management believes is the fair value of the stock.
Accordingly, the amounts receivable from the shareholder to Omni have been
shown as a reduction of stockholders equity at March 31, 2003 and 2002.
At March 31, 2002, Omni owed $41,129 to one of its shareholders and
officers. Interest on the advance was at 8% and the advance was due to be
repaid in May 2005. In April 2002, the advance, together with accrued
interest of $3,871 was converted to 197,232 shares of Omni common stock.
Included in interest expense for the year ended March 31, 2002 is $3,871
relating to the advance.
Description of Securities.
--------------------------
Market Price of and Dividends on Piezo's Common Equity and Related Stockholder
Matters.
--------
Market Information.
-------------------
The Company's shares are traded on the OTC Bulletin Board under the
symbol "ONMH"; however, there is and has been no "established trading market"
for these securities.
Their has never been a publicly-traded market for the securities of Omni.
Holders.
--------
The number of record holders of the Company's common stock as of
September 22, 2003, is approximately 206. Omni had approximately 100
stockholders on that date. The Company is in the process of exchanging its
securities with the Omni Stockholders, pending a determination of whether all
are still "accredited investors" as represented at the time of their
respective investments in Omni.
Dividends.
----------
The Company has not declared any cash dividends with respect to its
common stock and does not intend to declare dividends in the foreseeable
future. The future dividend policy of the Company cannot be ascertained with
any certainty, and until the Company completes any acquisition, reorganization
or merger, as to which no assurance may be given, no such policy will be
formulated. There are no material restrictions limiting, or that are likely to
limit, the Company's ability to pay dividends on its common stock.
Legal Proceedings.
------------------
Neither the Company nor Omni is not a party to any pending legal
proceeding and, to the knowledge of management; no federal, state or local
governmental agency is presently contemplating any proceeding against the
Company or Omni. No director, executive officer or affiliate of the Company,
Omni or owner of record or beneficially of more than five percent of the
Company's or Omni's common stock is a party adverse to the Company or Omni or
has a material interest adverse to the Company or Omni in any proceeding.
Changes in and Disagreements with Accountants.
----------------------------------------------
Mantyla, McReynolds & Associates, 5872 South 900 East, Suite 250, Salt
Lake City, Utah 84121, has been retained as the Company's auditor for the past
four years. During that period, there has been no disagreements between the
Company and its auditors.
Gelfond Hochstadt Pangburn, P.C. of Denver, Colorado, audited the
financial statements of Omni for the years ended March 31, 2002 and 2001, and
have been retained to audit the financial statements of Omni for the years
ended March 31, 2003 and 2002. It is anticipated that Gelfond Hochstadt
Pangburn, P.C. will be named as the Company's auditors in the near future, and
an 8-K Current Report respecting any such engagement will be timely filed with
the Securities and Exchange Commission.
Recent Sales of Unregistered Securities.
----------------------------------------
On November 5, 2002, pursuant to Unanimous Consent of the Company's Board
of Directors, the Company resolved to issue 18,000,000 shares of the Company's
"unregistered" and "restricted" $0.001 par value common stock to Jenson
Services, Inc., a Utah corporation, in consideration of $5,000 being advanced
to the Company to meet accounts payable obligations. These shares were
cancelled as a condition to the closing of the Reorganization Agreement with
Omni. See Item 1, above.
Except as indicated under Item 1, above, no other "restricted
securities" of the Company have been issued during the past three years.
Indemnification of Directors and Officers.
------------------------------------------
Section 16-10a-902(1) of the Utah Revised Business Corporation Act
authorizes a Utah corporation to indemnify any director against liability
incurred in any proceeding if he or she acted in good faith and in a manner he
or she reasonably believed to be in or not opposed to the best interests of
the corporation, and, with respect to any criminal action or proceeding, had
no reasonable cause to believe his or her conduct was unlawful.
Section 16-10a-902(4) prohibits a Utah corporation from indemnifying a
director in a proceeding by or in the right of the corporation in which the
director was adjudged liable to the corporation or in a proceeding in which
the director was adjudged liable on the basis that he or she improperly
received a personal benefit. Otherwise, Section 16-10a-902(5) allows
indemnification for reasonable expenses incurred in connection with a
proceeding by or in the right of a corporation.
Unless limited by the Articles of Incorporation, Section 16-10a-905
authorizes a director to apply for indemnification to the court conducting the
proceeding or another court of competent jurisdiction. Section 16-10a-907(1)
extends this right to officers of a corporation as well.
Unless limited by the Articles of Incorporation, Section 16-10a-903
requires that a corporation indemnify a director who was successful, on the
merits or otherwise, in defending any proceeding to which he or she was a
party against reasonable expenses incurred in connection therewith. Section
16-10a-907(1) extends this protection to officers of a corporation as well.
Pursuant to Section 16-10a-904(1), the corporation may advance a
director's expenses incurred in defending any proceeding upon receipt of an
undertaking and a written affirmation of his or her good faith belief that he
or she has met the standard of conduct specified in Section 16-10a-902.
Unless limited by the Articles of Incorporation, Section 16-10a-907(2) extends
this protection to officers, employees, fiduciaries and agents of a
corporation as well.
Regardless of whether a director, officer, employee, fiduciary or agent
has the right to indemnity under the Utah Revised Business Corporation Act,
Section 16-10a-908 allows the corporation to purchase and maintain insurance
on his or her behalf against liability resulting from his or her corporate
role.
Financial Statements of Omni.
-----------------------------
These audited financial statements for Omni will be provided as
soon as they are available, but within 75 days from the date of this Current
Report or on or before November 19, 2003. See Item 7.
These pro forma financial statements will be provided as soon as
they are available, but within 75 days from the date of this Current Report or
on or before November 19, 2003. See Item 7.
Item 3. Bankruptcy or Receivership.
---------------------------
None, not applicable.
Item 4. Changes in Registrant's Certifying Accountant.
----------------------------------------------
None, not applicable.
Item 5. Other Events and Regulation FD Disclosure.
------------------------------------------
None; not applicable.
Item 6. Resignations of Registrant's Directors.
---------------------------------------
Pursuant to the Reorganization Agreement, the current officers and
directors of Omni were designated to serve on the Board of Directors of Piezo
and as executive officers of Piezo until the next respective annual meetings
of the stockholders and the Board of Directors and until their respective
successors are elected and qualified or until their prior resignations or
terminations. Effective on September 5, 2003, they were: Arthur D. Lyons,
President, CEO, Secretary and Director; and Charles d. Arbeiter, COO,
Treasurer and Director. The directors and executive officers of Piezo
resigned, in seratim, on closing of the Reorganization Agreement.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
---------
(a) Financial Statements of Businesses Acquired.
These financial statements will be provided as soon as they are
available, but within 75 days from the date of this Current Report or on or
before November 19, 2003.
(b) Pro Forma Financial Information.
These pro forma financial statements will be provided as soon as
they are available, but within 75 days from the date of this Current Report or
on or before November 19, 2003.
(c) Exhibits.
Attached:
---------
2.1 Agreement and Plan of Reorganization
Exhibit A & A-1 Omni Stockholders
Exhibit B Piezo Financial Statements for
the years ended December 31, 2002
and 2001(1)
Exhibit B-1 Piezo Financial Statements for
The period ended June 30, 2003(2)
Exhibit C Exceptions to Piezo Financial
Statements
Exhibit D Omni Financial Statements
for the years ended March 31,
2002 and 2001 ("Audited", and the
nine months ended December 31, 2002
(Unaudited)(3)
Exhibit E Exceptions to Omni Financial
Statements
Exhibit F Investment Letter
Exhibit G Piezo Compliance Certificate
Exhibit H Omni Compliance Certificate
Schedule 1.5.1 Canceling Principal Stockholders
Schedule 1.5.2 Shares Issued in Consideration
Of Cancellation and Waiver of
Registration Rights
Schedule 1.6.1 Piezo Stockholders Subject to
Lock-Up/Leak-Out Agreement
Schedule 1.6.2 Lock-Up/Leak-Out Agreement
Schedule 1.7.1 Consulting Agreement
99.1 Letter to Omni Stockholders
99.2 Accredited/Sophisticated Investor Questionnaire
99.3 Letter of Instructions
99.4 Acknowledgment
Incorporated by Reference:
--------------------------
10-KSB Annual Report for the year ended December 31, 2002, filed with the
Securities and Exchange Commission on March 26, 2003.
10-QSB Quarterly Report for the quarter ended June 30, 2003, filed with the
Securities and Exchange Commission on July 16, 2003.
Preliminary Information Statement filed with the Securities and Exchange
Commission on September 17, 2003.
Amended Preliminary Information Statement will be filed with the Securities
and Exchange Commission on September 23, 2003.
(1) Incorporated by reference from the 10-KSB Annual Report of Piezo
for the year ended December 31, 2002.
(2) Incorporated by reference from the 10-QSB Quarterly Report of
Peizo for the quarter ended June 30, 2003.
(3) See the caption "Financial Statements of Omni," above, and Item
7.
Item 8. Change in Fiscal Year.
----------------------
None; not applicable.
Item 9. Regulation FD Disclosure.
-------------------------
See the 8-K Current Report dated September 5, 2003, which has been
previously filed with the Securities and Exchange Commission.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this Report to be signed on its behalf by
the undersigned hereunto duly authorized.
PIEZO INSTRUMENTS, INC.
Date: 9/22/03 /s/ Arthur D. Lyons
-------- ------------------------
Arthur D. Lyons
Director and President