ISSUER INFORMATION AND DISCLOSURE STATEMENT
SECURITIES AND EXCHANGE COMMISSION RULE 15c2-11
September 23, 2005
WisdomTree Investments, Inc. (A Delaware Corporation)
TRADING SYMBOL: WSDT.PK CUSIP NO. 97717P 10 4 TAX ID NUMBER 13-3487784 STOCKHOLDERS OF RECORD 96
The Information set forth herein is made available by the Issuer to pursuant to Rule 15c2- 11of the Securities and Exchange Act of 1934, as amended.
The information furnished herein has been prepared from the books and records of the issuer by its officers in accordance with the Securities and Exchange Commission Rule 15c2-11, as amended. No dealer, salesman or any other person has been authorized to give any information or to make any representations not contained herein in connection with the issuer. Such information or representations, if made, must not be relied upon as having been authorized by the issuer and delivery of this information file does not, at any time, imply that the information contained herein is correct as of any time subsequent to the date first written above.
ITEM 1. EXACT NAME OF THE ISSUER AND ITS PREDCESSOR
The name of the Issuer is WisdomTree Investments, Inc. Prior to September 6, 2005, the Issuer’s name was Index Development Partners, Inc. Prior to June 18, 2002, the Issuer’s name was Individual Investor Group, Inc.
ITEM 2. ADDRESS OF THE ISSUER’S PRINCIPAL EXECUTIVE OFFICES
The principal executive office of the Issuer is located at 48 Wall Street, Suite 1100, New York, NY 10005; Telephone No. (212) 918 4580; Facsimile No. (212) 918 4581; Contact: Marc Ruskin (email: [email protected]).
ITEM 3. ISSUER’S STATE OF INCORPORATION
The Issuer is incorporated on September 19, 1985 under the laws of the State of Delaware.
ITEM 4. EXACT TITLE AND CLASS OF THE ISSUER’S SECURITIES
The Issuer’s common stock is the only class of equity securities outstanding. The CUSIP No. is 97717P 10 4 and the trading symbol is WSDT.PK.
139679.4 ITEM 5. PAR OR STATED VALUE OF THE ISSUER’S SECURITIES
The Issuer’s shares of common stock have a par value of $.01 per share.
ITEM 6. NUMBER OF SHARES OR TOTAL AMOUNT OF ISSUER’S SECURITIES OUTSTANDING AT THE END OF THE ISSUER’S MOST RECENT FISCAL YEAR 12/31/2004 6/30/2005 7/31/2005 Authorized Common Stock 100,000,000 100,000,000 250,000,000 Outstanding Common Stock 72,672,748 72,672,748 78,510,573 Public Float 10,956,314 11,003,721 13,246,039 Approximate Number of 73 81 96 Stockholders of Record As of the last date that the Issuer made inquiry, in October 2003, the Issuer believed that there were approximately 2,200 beneficial owners of its outstanding common stock.
A) The Issuer has not issued any securities in a registered public offering subsequent to January 1, 2003. Since January 1, 2003, the Issuer has issued the following securities pursuant an exemption from the registration requirement of the Securities Act of 1933, as amended (“1933 Act”) by virtue of Section 4(2), Rule 506 promulgated thereunder or Section 3(a)(9). All of these securities are deemed “restricted” securities within the meaning of the 1933 Act and, with the exception noted below, these securities may only be sold pursuant to an available exemption from the registration (such as Rule 144) or an effective registration statement.
• On July 22, 2005 the Issuer issued 5,769,242 shares of common stock for aggregate consideration of $7,500,000 pursuant to a private placement.
• On June 22, 2005 the Issuer issued 80,000 shares of common stock for aggregate consideration of $100,000 upon the exercise of a stock option. The option exercise price was paid, in accordance with the terms of the option, by the surrender of 58,824 shares of common stock owned by the optionholder with a fair market value of $100,000, which fair market value was determined in accordance with the terms of the option.
• On March 29, 2005 the Issuer issued 47,407 shares of common stock for aggregate consideration of $3,500 upon the exercise of a
2 139679.4 stock option. The option exercise price was paid, in accordance with the terms of the option, by the surrender of a portion of the option having a fair market value equal to the aggregate exercise price of the portion of the option that was exercised, which fair market value was determined in accordance with the terms of the option.
• On November 10, 2004 the Issuer issued 56,250,000 shares of common stock for aggregate consideration of $9,000,000 pursuant to a private placement.
• On November 10, 2004, the Issuer issued 1, 500,000 shares of restricted stock to an advisor in exchange for future services to be rendered over a five-year period. Although registered in the name of the advisor, the shares are held by the Issuer until vested, which occurs in five equal annual installments.
• On October 7, 2004, the Issuer issued 1,260,800 shares of common stock in lieu of cash payment of unpaid dividends of $315,200 that had accrued with respect to the Issuer’s previously outstanding Series A Preferred Stock.
• On March 24, 2004 the Issuer issued 5,000,000 shares of common stock for aggregate consideration of $150,000 in a private placement.
• On December 31, 2003, the Issuer issued 743,396 shares of common stock upon the automatic conversion of the Issuer’s Series A Preferred Stock.
3 139679.4 B) See Item 6(A) above.
C) Since January 1, 2003, the Issuer has issued ten-year options to purchase an aggregate of 11,234,292 shares of common stock. These options were issued solely to employees or directors of the Issuer, were issued in consideration of services to be rendered to the Issuer, vest over various periods of time ranging from one-year to five years, and have exercises prices ranging from $.03 to $2.03. The exercise price of each option was equal to or greater than the fair market value of the common stock on the day of grant. In addition, on November 10, 2004, the Issuer issued warrants to purchase 300,000 shares of common stock at an exercise price of $0.28 per share, expiring February 7, 2009, to a person (and his two designees) who acted as a finder in connection with the Issuer’s $9,000,000 private placement in November 2004.
ITEM 7. NAME AND ADDRESS OF THE ISSUER’S STOCK TRANSFER AGENT
Continental Stock Transfer & Trust Company 17 Battery Place, 8th Floor New York, New York 10004 Tel: 212 509-4000
The transfer agent is registered as such pursuant to the Securities Act of 1934 with the SEC.
ITEM 8. NATURE OF THE ISSUER’S BUSINESS
A) Business Development
The Issuer has been engaged in several businesses since it commenced operations in October 1988. The Corporation was originally a publisher of financial magazines and remained in that business until it sold its last print publication in May 2002. These magazines included Individual Investor, Individual Investor’s Special Situations Report and Ticker. Individual Investor had at one time a paid circulation of almost 500,000. As a natural extension of the print publications business, the Issuer was also engaged in the online services business from1997 to 2001, with several websites including individual investor.com, insider trader.com and shortinterest.com In addition, from 1993 until 1998, the Issuer also was engaged in the investment management business through its subsidiaries, serving as an advisor to the sponsor or several unit trusts and managing two private investment partnerships.
By 2001 the Issuer had sold most of its print and online media properties and had developed the first of a number of proprietary stock market indexes. The Issuer licensed its “America’s Fastest Growing Companies” Index to Nuveen Investments, Inc. for the creation of an exchange-traded fund to be sponsored by Nuveen and based upon that index. After receiving an exemptive order it sought from the Securities and Exchange Commission and filing a registration statement, Nuveen did not take further action to launch such a fund. Consequently, the Issuer terminated the license with Nuveen in
4 139679.4 November 2002 and sought to enter into similar license arrangements with other companies in the mutual fund and financial services industry.
In 2003 the Issuer changed its business plan and determined that, rather than license its indexes to third parties that would sponsor exchange traded funds, the Issuer itself would sponsor, as a holding company acting through its subsidiaries, a family of exchange-traded funds based on the Issuer’s own proprietary portfolios. Exchange- traded funds, or ETFs, can provide investors access to a diversified portfolio of stocks, as do mutual funds; however, as a result of their low fees, liquidity and tax efficiencies, they represent the fastest growing segment of the mutual fund industry.
In 2003 and 2004, the Issuer sought financing for its new business plan. These efforts resulted in the Issuer’s November 2004 private placement that raised $9,000,000 from a group of investors led by Michael Steinhardt and RRE Investors, LLC, a private equity firm founded by among others, James D. Robinson III. In July 2005, the Issuer followed this first private placement with a second round of financing that raised $7,500,000. This second round was led by Michael Steinhardt and RRE Ventures, as well as Jeremy J. Siegel and Quantitative Financial Strategies, Inc. As important as the financings were, equally important was the reconstitution of the Issuer’s Board of Directors to include directors of strategic importance to the implementation of the Issuer’s business plan. The Board of Directors currently is comprised of Mr. Steinhardt, James D. Robinson IV, Professor Jeremy Siegel, the Russell E. Palmer Professor of Finance at the Wharton School of the University of Pennsylvania, Frank Salerno, formerly a senior executive at Merrill Lynch and Bankers Trust, and Jonathan Steinberg, the Corporation’s founder and Chief Executive Officer.
To the end of becoming an ETF sponsor, the Corporation has filed a standard application with the Securities and Exchange Commission for exemptive relief from various provisions of the Federal securities laws that are necessary to create and market ETF’s. The Corporation will also shortly be forming the trust entities that are the actual funds and which issue shares to investors. Following their formation, these trusts will file registration statements with the Securities and Exchange Commission to permit the public marketing of the ETF’s. Lastly, the Corporation’s wholly-owned subsidiary will become an investment advisor registered with the Securities and Exchange Commission.
1. The Issuer is a Delaware Corporation.
2. The Issuer was incorporated on September 19, 1985, but did not commence any business activity until October 1988.
3. The Issuer’s fiscal year end is December 31t.
4. The Issuer has never been in bankruptcy, receivership or similar proceeding.
5. In May 2002, the Issuer sold the last media property that was part of its print publications discontinued operations.
5 139679.4 6. Since January 1, 2002, the Issuer has not defaulted on any terms of any note, loan, equipment lease or other financing arrangements, except that the Issuer did not pay when due $315,200 of cash dividends that had accrued in 2002 and 2003 on its then outstanding Series A Preferred Stock. As set forth in Item 6(A) above, this obligation was satisfied in October 2004 when the holders of the Series A Preferred Stock agreed to accept 1,260,800 shares of common stock as payment in full.
7. On November 10, 2004, the Issuer issued 56,250,000 shares of common stock in its private placement as described in Item 6(A) above. These shares constituted 77.4% of the outstanding common stock immediately following the transaction. The investors in that private placement, the Issuer’s founder and Chief Executive Officer and the Issuer’s other employees, entered into a Stockholders’ Agreement pursuant to which they agreed to, among other things, to vote the shares of common stock owned by them in favor of certain nominees designated in, or pursuant to, that agreement. If desired by such investors, their designees would constitute a majority of the Board of Directors. Accordingly, upon consummation of this private placement, the Issuer underwent a change in control.
8. Pursuant to two of the private placements enumerated in Item 6(A), the Issuer increased its outstanding common stock by more than 10%. On March 24, 2004 the Issuer issued 5,000,000 shares, which represented an approximate 58% increase in shares outstanding. On November 10, 2004 the Issuer issued 56,250,000 shares for, which represented an approximate 377% increase in shares outstanding.
9. Since January 1, 2003 there has not been, and there are no current plans for, any stock split, stock dividend, recapitalization, merger, acquisition, spin-off or reorganization.
10. The Issuer completed its initial public offering of securities in December 1991 on a firm commitment underwritten basis. From December 1991 through May 2001, the Issuer’s common stock was quoted on the Nasdaq SmallCap Market or the Nasdaq National Market. On May 23, 2001, the Issuer’s common stock was delisted from the Nasdaq National Market on the grounds it failed to maintain the requisite minimum closing bid price and minimum market value of public float requirements. From May 23, 2001 until May 23, 2003, the Issuer’s common stock was quoted on the NASD OTC Bulletin Board. The Issuer was removed from the OTC Bulletin Board on May 23, 2003 because it failed to timely file its Form 10-KSB for the fiscal year ended December
6 139679.4 31, 2002. After this Form 10-KSB, and two subsequent Quarterly Reports on Form 10-QSB were filed by the Issuer with the Securities and Exchange Commission, on November 13, 2003 the Issuer filed a Form 15 and deregistered its common stock under Section 12 of the Securities Exchange Act of 1934. Accordingly, the Issuer has not filed any public reports with the Securities and Exchange Commission since November 2003.
11. The Issuer has no current, past, pending or threatened legal proceedings or administrative actions by or against the Issuer that could have a material effect on the Issuer’s business, financial condition or operations.
B) Business of Issuer. See Item 8(A). The Issuer develops domestic and international stock portfolios that the Issuer seeks to commercially exploit, through its subsidiaries, primarily by becoming a fund sponsor and investment advisor for exchange- traded funds based upon these proprietary portfolios and by managing money directly for institutional investors based upon these proprietary portfolios. As such the Issuer expects to derive revenue from the receipt of fees for its services.
1. The Issuer’s primary SIC code is 523920.
2. The Issuer’s current business operations are classified as “developmental stage.”
3. The Issuer currently has a 100%-owned subsidiary, WisdomTree Asset Management, Inc., a Delaware corporation, whose operations are consolidated for accounting purposes with the Issuer’s.
4. The Issuer’s intended business of sponsoring and serving as the investment advisor for exchange-traded funds and managing money directly for institutional investors is highly regulated at both the Federal and state level. The Issuer, its subsidiary and the funds it creates will be subject to regulation under the Investment Company Act of 1940, the Investment Advisor Act of 1940, the Securities Act of 1933 and/or the Securities Exchange Act of 1934. As such, the Issuer will devote substantial resources toward compliance with this regulatory structure.
5. Research and development costs for the last two fiscal years amounted to $295,511. None of these costs are borne directly by the Issuer’s customers.
6. The Issuer has no costs for compliance with environmental laws.
7. At September 19, 2005, the Issuer has eight employees, all of whom work on a full-time basis.
7 139679.4 C) Investment policies
1. The Issuer manages it cash resources on a conservative basis, primarily in cash and cash equivalents.
ITEM 9. NATURE OF THE ISSUER’S PRODUCTS OR SERVICES:
1. The Issuer is a development stage company currently in transition from being a developer of stock market portfolios to becoming a sponsor and investment advisor to exchange-traded funds and a manager of institutional money invested against such portfolios.
2. Not yet applicable.
3. Not yet applicable.
4. The business in which the Issuer intends to enter is highly competitive, with many companies having significantly greater resources than the Issuer. The Issuer believes its portfolios are superior to existing comparable indexes and the Issuer intends to compete on the basis of providing higher investment returns on a net-of–fees basis.
5. The Issuer intends to use the services of third-party vendors to perform most of the functions associated with being a sponsor of, and investment advisor to, a family of exchange-traded funds and managing institutional money. These third party sources are readily available.
6. The Issuer currently has no customers.
7. The Issuer believes that respective methodologies of its proprietary models constitute one of the Issuer’s core assets and the Issuer is committed to protecting the value of that intellectual property. The Issuer has filed patent applications with respect to certain of its intellectual property.
The Issuer also believes that trademarks and service marks are important to its business and actively pursues strategies to protect and strengthen its current marks for use in connection with its products and for future products. The Issuer possesses a number of registered trademarks and servicemarks and it has also filed for registration of numerous other trademarks and servicemarks.
8. As stated above, the business in which the Issuer intends to engage is highly regulated. The Issuer is in the process of seeking the regulatory approvals and registrations required to engage in this business.
8 139679.4 ITEM 10. NATURE OF THE ISSUER’S FACILITIES
The Issuer currently occupies approximately 1000 square feet within an executive office suite in New York City. This lease maybe canceled upon 90 days notice. These facilities are suitable for the Issuer’s current needs.
ITEM 11. A) CHIEF EXECUTIVE OFFICERS AND MEMBERS OF THE BOARD OF DIRECTORS AND TERM OF OFFICE
Name Title Common Stock Beneficially Owned (1)(3) Executive Officers Jonathan Steinberg President/Chief Executive 8,625,478 (10.3%) Officer/Secretary/Director Marc Ruskin Chief Financial Officer 200,000 (*) Directors Michael Steinhardt Chairman of the Board 35,185,962 (44.3%) (non-executive)/Director James D. Robinson, IV Director 20,381,156 (24.5%) (includes the RRE Venture funds identified in Note 2 below) Jeremy Siegel Director 2,835,000 (3.6%) Frank Salerno Director 76,924 (*) Other 5% Stockholders
(*) Less than 1%.
(1) The Issuer believes that the persons listed above have either sole or shared voting or investment power with respect to the shares (either because such shares are held of record or because the person is believed by the Issuer to be in a position that confers such power (e.g., a general partner of a limited partnership or a manager of a limited liability company). The number of shares indicated includes shares that are issuable upon the exercise of options held of record by the person (or for which the person is believed to have sole or shared voting or investment power) that are exercisable or will become exercisable within the next 60 days. For purposes of calculating the percentage owned, the Issuer has assumed that the person has exercised all options held by him, but that options held by others have not been exercised.
(2) The shares indicated include shares or options held by RRE Ventures III-A, L.P., RRE Ventures Fund III, L.P., and RRE Ventures III, L.P. and WTAT II, LLC, for which Mr. Robinson serves as a general partner or managing member.
9 139679.4 (3) In connection with the Issuer’s November 2004 private placement, each of the investors, the Issuer’s founder and Chief Executive Officer and the Issuer’s other employees, entered into a Stockholders’ Agreement pursuant to which they agreed to, among other things, to vote the shares of common stock owned by them in favor of certain nominees designated in, or pursuant to, that agreement. Accordingly, the parties to the Stockholders’ Agreement (identified below) may be considered to possess shared voting power with respect to all shares owned by the other parties thereto. These parties collectively own 70,973,801 shares of common stock (including shares underlying currently exercisable options or options exercisable within 60 days), or 82.4% of the outstanding shares, calculated as described in Note 1. The parties are:
Michael Steinhardt; RRE Ventures III-A, L.P.; RRE Ventures Fund III, L.P.; RRE Ventures III, L.P.; Quantitative Financial Strategies, Inc.; Saul Steinberg; Jonathan Steinberg, Rayne Steinberg and Luciano Siracusano.
• Counsel: Graubard Miller The Chrysler Building 405 Lexington Avenue, 19th Floor New York, NY 10174 Attention: Peter M. Ziemba, Esq. Tel: (212) 818-8667 Email: [email protected]
• Auditor: Marcum Kliegman LLP 655 Third Avenue, 16th Floor New York, NY 10017 Attention: David C. Buzkin Tel: (212) 981-3000
The Issuer’s auditors has audited the Issuer’s financial statements for the fiscal years ended December 31, 2003 and 2004, and has prepared the Issuer’s tax returns. The auditors are independent, fully qualified and licensed to serve as the Issuer’s auditors if the Issuer’s common stock were registered under Section 12 of the Securities Exchange Act of 1934 and a reporting company
• Public Relations: Dukas Public Relations 35 Bennett Road Teaneck, NJ 07666 Attention: Richard Dukas Tel: (212) 704-7385
• Investor Relations Consultant: None.
10 139679.4 Jonathan L. Steinberg
Jonathan Steinberg is the President and Chief Executive Officer of the Issuer and a member of its Board of Directors. Mr. Steinberg founded the Issuer and has served as its Chief Executive Officer since October 1988. From August 1986 to August 1988, Mr. Steinberg was employed as an analyst in the Mergers and Acquisitions Department of Bear, Stearns & Co. Inc., an investment banking firm. Mr. Steinberg is the author of Midas Investing, published by Times Books, a division of Random House, Inc., in 1996, and the former Editor-in-Chief of Individual Investor and Ticker magazines.
Marc Ruskin
Marc Ruskin has served as the Chief Financial Officer of the Issuer since May 2005, after serving as a consultant to the Issuer since November 2004. Mr. Ruskin has been at the senior management level of finance for more than 20 years, having served as the Chief Financial Officer for both publicly-traded and privately-held companies. He has worked in a variety of industries including technology and financial services. Mr. Ruskin most recently served as Chief Financial Officer of RiskMetrics Group Inc., an international firm that measures financial risks of portfolio investments. Previously, he was the Chief Financial Officer of Cognet Corp. a technology firm specializing in the development of automation and deployment of management software. He has also served on several boards of directors. A Certified Public Accountant, Mr. Ruskin began his career as an auditor for Deloitte & Touche LLP.
Michael Steinhardt
After graduating from the Wharton School of Business in 1960, Michael H. Steinhardt began his financial career as a research associate, staff writer and securities analyst. In 1967 he formed his own hedge fund company, Steinhardt Partners L.P., where he made his fortune in what has been described as one of the most renowned careers in the history of Wall Street. In 1995, Mr. Steinhardt closed his lucrative hedge fund to devote his time and fortune to philanthropy. Mr. Steinhardt became the non-executive Chairman of the Board of the Issuer in November 2004.
James D. Robinson, IV
James D. Robinson, IV is a co-founder and General Partner of RRE Ventures, LLC and affiliates. He has been active within the technology community for over twenty years as a venture capital investor, banker and entrepreneur. While earning his double degree in Computer Science and Business Administration at Antioch College during the early 1980's, Mr. Robinson worked as a programmer developing email systems for state government, and later founded and was President of IV Systems Inc., a firm that created custom applications for UNIX workstations. In 1986, Mr. Robinson joined JP Morgan & Company, where he spent four years working on technology-related assignments, first within the Global Exposure Management group building risk management systems, and later as an investment banker in the Corporate Finance group focused on technology and communications companies. Mr. Robinson earned an MBA from Harvard in 1992, and
11 139679.4 subsequently joined Hambrecht & Quist Venture Capital in San Francisco. While at H&Q, he led investments primarily within the software and communications sectors, and served as a General Partner across several investment funds for the firm. Since co- founding RRE in late 1994, Mr. Robinson has been responsible for over 25 technology investments. He serves on the boards of directors of numerous companies and became a director of the Issuer in November 2004.
Jeremy J. Siegel
Jeremy J. Siegel is the Russell E. Palmer Professor of Finance at the Wharton School of the University of Pennsylvania. Prof. Siegel has written and lectured extensively about the economy and financial markets, has appeared frequently on CNN, CNBC, NPR and others networks, and has contributed articles to The Wall Street Journal, Barron's, The Financial Times and other national and international news media. In 1994 Professor Siegel received the highest teaching rating in a worldwide ranking of business school professors conducted by Business Week magazine. His book Stocks for the Long Run was named by Business Week magazine as one of the top ten business books published in 1994 and by James Glassman of the Washington Post as one of the ten-best investment books of all time. His most recent book The Future for Investors, was published in early 2005. Prof. Siegel became a director of the Issuer in November 2004, and he also serves the Issuer in a consulting capacity as its Senior Investment Strategy Advisor.
Frank Salerno,
Mr. Salerno, who retired in 2004 from Merrill Lynch after serving as the Chief Operating Officer & Chief Investment Officer of its America’s Institutional Division, has more than two decades experience in the investment management industry. Mr. Salerno was instrumental in rejuvenating Merrill Lynch’s institutional asset management business. At the end of 2003, this business managed more than $140 billion in assets for the country’s leading corporate pension, 401(k) and public retirement programs. As one of six members of Merrill Lynch Investment Managers Global Sales Committee, Mr. Salerno coordinated world-wide sales of the group’s financial products. Before joining Merrill Lynch in 1999, Mr. Salerno spent 18 years with Bankers Trust. In 1990, he assumed responsibility for Bankers Trust’s domestic index management business and in 1995 became Chief Investment Officer for its Structured Investment Management Group. Mr. Salerno became a director of the Issuer in July 2005.
D) To the Issuer’s knowledge, none of the above have in the last five years been the subject of:
1. a conviction in a criminal proceeding or named as a defendant in any pending proceedings;
2. the entry of an order, judgment or decree, not subsequently reversed, suspended or vacated, by a court of competent jurisdiction that permanently or temporarily enjoined, barred,
12 139679.4 suspended or otherwise limited such persons involvement in any type of business, securities, commodities or banking activities;
3. a finding or judgment by a court of competent jurisdiction (in a civil action) the SEC, the CFTC or a state securities regulator of a violation of federal or state Securities or commodities law, which finding or judgment has not been reversed, suspended or vacated; or
4. The entry of an order by a self-regulatory organization that permanently or temporarily barred suspended or otherwise limited such person’s involvement in any type of business or securities activities.
E) Beneficial Owners: See Item 11(A).
ITEM 12. ISSUER’S MOST RECENT BALANCE, PROFIT AND LOSS AND RETAINED EARNINGS STATEMENT
The Issuer’s most recent unaudited Balance Sheet (At July 31, 2005) and Statement of Operations and Statement of Cash Flows (for the period January 1, 2005 through July 31, 2005) are attached hereto as Exhibit A.
ITEM 13. SIMILAR FINANCIAL INFORMATION FOR SUCH PART OF THE TWO PROCEEDING FISCAL YEARS AS THE ISSUER OR ITS PREDECESSOR HAS BEEN IN EXISTENCE.
The Issuer’s audited financial statements for the fiscal years ended December 31, 2003 and 2004 are attached as Exhibit B.
ITEM 14. DISCLOSE WHETHER THE QUOTATION IS BEING SUBMITTED OR PUBLISHED, DIRECTLY OR INDIRECTLY, ON BEHALF OF THE ISSUER OR ANY DIRECTOR OR OFFICER OR ANY PERSON DIRECTLY OR INDIRECTLY FOR THE BENEFICIAL OWNER OR MORE THAN 5% OF THE OUTSTANDING SHARES OF ANY EQUITY SECURTY OF THE ISSUER.
No quotation is being submitted on or is being published directly or indirectly on behalf of the Issuer or, to Issuer’s knowledge, any director or officer or any person directly or indirectly for the beneficial owner of more than 5% of the outstanding share of any equity security of the Issuer.
ITEM 15. TRADABILITY OPINION LETTER ISSUED BY COUNSEL
Not applicable. The Issuer completed its initial public offering of securities in December 1991 on a firm commitment underwritten basis. From December 1991
13 139679.4 through May 2001, the Issuer’s common stock was quoted on the Nasdaq SmallCap Market or the Nasdaq National Market. From May 23, 2001 until May 23, 2003, the Issuer’s common stock was quoted on the NASD OTC Bulletin Board. On November 13, 2003 the Issuer filed a Form 15 and deregistered its common stock under Section 12 of the Securities Exchange Act of 1934.
ISSUER’S CONTINUING DISCLOSURE OBLIGATIONS
The Issuer will provide updates to its Financial Statements on a quarterly basis, as well as disclose any significant changes in the above information, no later than 90 days after a fiscal year end and 45 days after the end of any fiscal quarter.
14 139679.4
Exhibit A INDEX DEVELOPMENT PARTNERS, INC.
(A Development Stage Company Commencing January 1, 2003)
Financial Statements
For the Period Ended July 31, 2005 Financial Principal's Letter Regarding Financial Statements
The financial information in this report is unaudited; and is based on present knowledge and belief and is believed to be correct and in accordance with generally accepted accounting principles.
The Issuer has duly caused this report to be signed on its behalf by the undersigned, duly authorized on the 23rd day of September, 2005
/s/ Marc J Ruskin Chief Financial Officer WisdomTree Investments, Inc. INDEX DEVELOPMENT PARTNERS, INC. (A Development Stage Company Commencing January 1, 2003) BALANCE SHEET July 31 , 2005
ASSETS
Current Assets Cash and cash equivalents$ 13,852,308 Prepaid Insurance and other current assets 107,246
Total Current Assets 13,959,554
Property and Equipment, Net 10,330
Other Assets 60,040
Total Assets $ 14,029,924
LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities Accounts payable and other current liabilities$ 366,840 Liabilities from discontinued operation 567,631
Total Liabilities 934,471
Commitments and Contingencies
Stockholders' Equity Preferred Stock, par value $.01; 2,000,000 shares authorized; -0- shares issued and outstanding $ -- Common Stock, par value $.01; 250,000,000 authorized; 785,106 78,510,573 shares issued and outstanding Additional paid-in capital 53,443,646 Deferred compensation (3,387,268) Accumulated deficit (34,511,406) Deficit accumulated during the development stage (3,234,625)
Total Stockholders' Equity 13,095,453
Total Liabilities & Stockholders' Equity $ 14,029,924 INDEX DEVELOPMENT PARTNERS, INC. (A Development Stage Company Commencing January 1, 2003) STATEMENT OF OPERATIONS For the Period January 1, 2005 to July 31 , 2005
Revenues -
Operating Expenses $ 1,662,849
Operating Loss (1,662,849)
Interest Income 92,037
Loss from Continuing Operations (1,570,812)
Income from Discontinued Operations 36,883
Net Loss $ (1,533,929)
Per Share Information: Basic and Fully Diluted Loss from Continuing Operations$ (0.02)
Income from Discontinued Operations 0.00
Net Loss Per Share$ (0.02)
Weighted Average Common Shares Basic and Fully Diluted 72,949,293 INDEX DEVELOPMENT PARTNERS, INC. (A Development Stage Company Commencing January 1, 2003) STATEMENTS OF STOCKHOLDERS' EQUITY/(DEFICIENCY) For the Years Ended December 31, 2004 and 2003 and the Period Ended July 31, 2005
Deficit Accumulated Preferred Stock Common Stock Additional During the Shares Par Shares Par Paid-in Deferred Accumulated Development Issued Value Issued Value Capital Compensation Deficit Stage Total
BALANCE - January 1, 2003 7,880 $ 79 7,894,552 $ 78,946 $ 34,181,421 $ -- $ (34,511,406) $ -- $ (250,960)
Stock option grants ------24,000 (24,000) ------Exercise of stock options -- -- 24,000 240 960 ------1,200 Conversion of preferred stock (7,880) (79) 743,396 7,434 (7,355) ------Preferred stock dividend ------(157,600) (157,600) Amortization of deferred compensation ------2,813 -- -- 2,813 Net loss ------(541,900) (541,900)
BALANCE - December 31, 2003 -- -- 8,661,948 86,620 34,199,026 (21,187) (34,511,406) (699,500) (946,447) Stock option grants ------272,558 (272,558) ------Cancellation of unvested stock options ------(6,000) 6,000 ------Sale of common stock -- -- 5,000,000 50,000 100,000 ------150,000 Shares issued as payment of preferred stock dividends -- -- 1,260,800 12,608 302,592 ------315,200 Shares issued for services -- -- 1,500,000 15,000 225,000 (240,000) ------Sale of common stock -- -- 56,250,000 562,500 7,877,498 ------8,439,998 Amortization of deferred compensation ------137,618 -- -- 137,618 Net loss ------(1,001,196) (1,001,196)
BALANCE - December 31, 2004 -- -- 72,672,748 726,728 42,970,674 (390,127) (34,511,406) (1,700,696) 7,095,173 Sale of common stock -- -- 5,769,242 57,692 7,213,658 -- -- 7,271,350 Exercise of stock options -- -- 68,583 686 (686) ------Stock option grants ------3,260,000 (3,260,000) ------Amortization of deferred compensation ------262,859 -- -- 262,859 Net loss ------(1,533,929) (1,533,929)
BALANCE - July 31, 2005 -- $ - 78,510,573 $ 785,106 $ 53,443,646 $ (3,387,268) $ (34,511,406) $ (3,234,625) $ 13,095,453 INDEX DEVELOPMENT PARTNERS INC (A Development Stage Company Commencing January 1, 2003) Statement of Cash Flows For the Period Ended July 31 , 2005
Cash Flows from operating activities Net Loss$ (1,533,929) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 2,714 Stock based compensation 262,859 Changes in operating assets and liabilities: Prepaid expenses and other current assets 22,285 Accounts Payable and other current liabilities 147,443
Total Adjustments 435,301
Net Cash used in Operations (1,098,628)
Cash Flows from discontinued operations Net income from discontinued operations (36,882) Changes in discontinued assets and liabilities (32,366)
Net cash provided by discontinued operations (69,248)
Cash Flows from investing activities Used For: Purchase of equipment (4,289) Other assets (41,050)
Net cash used in investing (45,339)
Cash Flows from financing activities Net proceeds from financing activities 7,271,350
Net cash provided by financing activities 7,271,350
Net increase
Summary Cash Balance at End of Period 13,852,308 Cash Balance at Beginning of Period 7,794,173
Net Increase
Exhibit B