PLAN OF DISTRIBUTION; TERMS OF THE OFFERING
We are offering 2,000,000 shares of common stock in a direct public offering,
without any involvement of underwriters or broker-dealers, 1,000,000 shares
minimum, 2,000,000 shares maximum basis. The offering price is $0.05 per share.
Funds from this offering will be placed in a separate bank account at BB&T, 6659
Falls of Neuse Road, Raleigh, NC 27615. Its telephone number is (919) 716-9644.
The funds will be maintained in the separate bank until we receive a minimum of
$100,000 at which time we will remove those funds and use the same as set forth
in the Use of Proceeds section of this prospectus. This account is not an
escrow, trust or similar account. Any funds received by us thereafter will
immediately used by us. If we do not receive the minimum amount of $50,000
within 180 days of the effective date of our registration statement, plus 90
additional days if we so choose, all funds will be promptly returned to you
without a deduction of any kind. During the 180 day period and possible
additional 90 day period, no funds will be returned to you. You will only
receive a refund of your subscription if we do not raise a minimum of $50,000
within the 180 day period referred to above which could be expanded by an
additional 90 days at our discretion for a total of 270 days. There are no
finders involved in our distribution.
Our sole officer and director will not purchase shares in this offering.
We will sell the shares in this offering through our sole officer and director,
Ms. Cynthia Allison. She will receive no commission from the sale of any shares.
She will not register as a broker/dealer under Section 15 of the Securities
Exchange Act of 1934 in reliance upon Rule 3a4-1. Rule 3a4-1 sets forth those
conditions under which a person associated with an issuer may participate in the
offering of the issuer's securities and not be deemed to be a broker/dealer. The
conditions are that:
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1. The person is not statutorily disqualified, as that term is defined in
Section 3(a)(39) of the Act, at the time of his participation; and,
2. The person is not compensated in connection with his participation by
the payment of commissions or other remuneration based either directly
or indirectly on transactions in securities;
3. The person is not at the time of their participation, an associated
person of a broker/dealer; and,
4. The person meets the conditions of Paragraph (a)(4)(ii) of Rule 3a4-1
of the Exchange Act, in that he (A) primarily performs, or is intended
primarily to perform at the end of the offering, substantial duties
for or on behalf of the issuer otherwise than in connection with
transactions in securities; and (B) is not a broker or dealer, or an
associated person of a broker or dealer, within the preceding twelve
(12) months; and (C) do not participate in selling and offering of
securities for any issuer more than once every twelve (12) months
other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii).
Cynthia Allison, is not statutorily disqualified, is not being compensated, and
is not associated with a broker/dealer. She is and will continue to be our sole
officer and director at the end of the offering and has not been during the last
twelve months and is currently not a broker/dealer or associated with a
broker/dealer. She has not during the last twelve months and will not in the
next twelve months offer or sell securities for another corporation.
We intend to advertise, through tombstones, and hold investment meetings in
various states where the offering will be registered. We will not utilize the
Internet to advertise our offering. We will also distribute the prospectus to
potential investors at the meetings and to our friends and relatives who are
interested in us and a possible investment in the offering.
We intend to sell our shares in the states of Illinois and Colorado.
Section 15(g) of the Exchange Act
Our shares are covered by Section 15(g) of the Securities Exchange Act of 1934,
as amended, and Rules 15g-1 through 15g-6 and Rule 15g-9 promulgated thereunder.
They impose additional sales practice requirements on broker/dealers who sell
our securities to persons other than established customers and accredited
investors (generally institutions with assets in excess of $5,000,000 or
individuals with net worth in excess of $1,000,000 or annual income exceeding
$200,000 or $300,000 jointly with their spouses). While Section 15(g) and Rules
15g-1 through 15g-6 apply to brokers-dealers, they do not apply to us.
Rule 15g-1 exempts a number of specific transactions from the scope of the penny
stock rules.
Rule 15g-2 declares unlawful broker/dealer transactions in penny stocks unless
the broker/dealer has first provided to the customer a standardized disclosure
document.
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Rule 15g-3 provides that it is unlawful for a broker/dealer to engage in a penny
stock transaction unless the broker/dealer first discloses and subsequently
confirms to the customer current quotation prices or similar market information
concerning the penny stock in question.
Rule 15g-4 prohibits broker/dealers from completing penny stock transactions for
a customer unless the broker/dealer first discloses to the customer the amount
of compensation or other remuneration received as a result of the penny stock
transaction.
Rule 15g-5 requires that a broker/dealer executing a penny stock transaction,
other than one exempt under Rule 15g-1, disclose to its customer, at the time of
or prior to the transaction, information about the sales persons compensation.
Rule 15g-6 requires broker/dealers selling penny stocks to provide their
customers with monthly account statements.
Rule 15g-9 requires broker/dealers to approved the transaction for the
customer's account; obtain a written agreement from the customer setting forth
the identity and quantity of the stock being purchased; obtain from the customer
information regarding his investment experience; make a determination that the
investment is suitable for the investor; deliver to the customer a written
statement for the basis for the suitability determination; notify the customer
of his rights and remedies in cases of fraud in penny stock transactions; and,
the NASD's toll free telephone number and the central number of the North
American Administrators Association, for information on the disciplinary history
of broker/dealers and their associated persons. The application of the penny
stock rules may affect your ability to resell your shares.
The NASD has adopted rules that require that in recommending an investment to a
customer, a broker-dealer must have reasonable grounds for believing that the
investment is suitable for that customer. Prior to recommending speculative low
priced securities to their non-institutional customers, broker-dealers must make
reasonable efforts to obtain information about the customer's financial status,
tax status, investment objectives and other information. Under interpretations
of these rules, the NASD believes that there is a high probability that
speculative low priced securities will not be suitable for at least some
customers. The NASD requirements make it more difficult for broker-dealers to
recommend that their customers buy our common stock, which may have the effect
of reducing the level of trading activity and liquidity of our common stock.
Further, many brokers charge higher transactional fees for penny stock
transactions. As a result, fewer broker-dealers may be willing to make a market
in our common stock, reducing a stockholder's ability to resell shares of our
common stock.
Offering Period and Expiration Date
This offering will start on the date of this prospectus and continue for a
period of up to 270 days.
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Procedures for Subscribing
If you decide to subscribe for any shares in this offering, you must
1. execute and deliver a subscription agreement
2. deliver a check or certified funds to us for acceptance or rejection.
All checks for subscriptions must be made payable to WILLOWTREE ADVISOR, INC.
Right to Reject Subscriptions
We have the right to accept or reject subscriptions in whole or in part, for any
reason or for no reason. All monies from rejected subscriptions will be returned
immediately by us to the subscriber, without interest or deductions.
Subscriptions for securities will be accepted or rejected within 48 hours after
we receive them.
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