Hard to Treat Diseases Incorporated --
HTTD – Announces: Letter to the Shareholders
Delray Beach, Fla., July 28, 2004 – Hard to Treat Diseases Incorporated (HTTD) (Pink Sheets:HTDS)
A Letter from Hard to Treat Diseases, Incorporated
This letter is in response to the concerns of certain shareholders and an opportunity to offer an overview of the past, present and future of our Company. Topics of concern and areas of importance are addressed below.
LITIGATION UPDATE:
As many of you are aware, this company has filed suit against Ronald Shinn and Gerry Knight, alleging various breaches of fiduciary duties they owed Hard to Treat Diseases, Inc. during their tenure as officers and directors of this Company and tortuous interference with Hard to Treat Diseases, Inc.’s business and contractual relationships. This case is pending in Federal Court, styled, Hard to Treat Diseases, Inc. f/k/a International Foam Solutions, Inc. v. Shinn, et al., Case No. 04-80010-CIV-Hurley. Shinn and Knight challenged the jurisdiction of that court and filed a Motion to Dismiss for Lack of Personnel Jurisdiction, or Alternatively, a Motion to Transfer the Case (to Oklahoma). On July 19, 2004, the Federal District Court entered an order Denying Shinn and Knight’s Motion to Dismiss or, alternatively, Motion to Transfer. Trial in this case is currently set for January, 2005.
Tubercin® TESTING:
Prior testing conducted at the University of Oklahoma Health Science Center concluded favorable results regarding Tubercin®’s toxicity trials and preliminary efficacy study.
The Denver Veteran’s Affairs Medical Center and the University of Colorado Health Sciences Center’s confidence in uses of Tubercin® are self-evident; otherwise they would not have wasted their valuable time and resources. The inventor of Tubercin®, Dr. Chung, has over 18 years of promising results for Tubercin® in South Korea. We have testing results and testimonials from patients who had terminal cancer, were treated with Tubercin ®and are still alive today. These treatments were conducted outside the US, so that the FDA does not recognize the results.
Our goal with Tubercin® is basic and straightforward:
1) aggressively advance the testing of Tubercin® under FDA guidelines
2) make strategic decisions
3) to be involved in negotiations with major drug firms within two years for the rights to Tubercin®
4) get Tubercin® to the patients who need it as fast as possible
Shareholders will be made aware of test results as soon as we receive them. There is nothing we can do to speed up the process!
T-19®:
The prior CEO of Hard to Treat Diseases, Inc.(“HTTD”), Ronald Shinn, announced in a press release of June 6, 2003 that “Due to the homeopathic nature of T-19®, the nasal spray application method of application does not require FDA approval in the USA and can be put on the holistic market immediately at relatively low cost.” in a subsequent press release on June 16, 2003, he stated that “T-19® Holistic Nasal Spray, to be available to the general public through holistic retailers, providers and practitioners worldwide, uses Tubercin®, an immune system builder, as its main ingredient.”
Current management announced in the press release of February 9, 2004 that “It is expected that a decision will be made sometime this month regarding the most expeditious manner to safely make available T-19® to the people who need it…The company’s consultants are also meeting with an FDA approved P-3 manufacturer regarding T-19®. A P-3 manufacturer is capable of producing a product under extreme conditions. Tubercin® and the related T-19® are produced from live Tuberculosis cells under extremely stringent conditions. Depending on the approval process required by the testing facility and the opinion of the Company’s Scientific Advisory Panel, the delivery system for the T-19® will either be a nasal spray or an inhaler. The holistic market for T-19® as an immunostimulant has phenomenal potential. We intend to get T-19® on the market as fast as possible.”
Current management cannot discover any factual basis supporting the former CEO, Shinn’s, claims that T-19® does not require FDA approval in the United States. No testing has been conducted in the USA at the point in time those statements were made.
The FDA bases their approval on testing conducted in the U.S. at FDA approved facilities; the FDA does not base its decisions on research and treatments done in Korea;. T-19® may well require FDA approval since it is produced from live Tuberculosis. For that reason, if testing proves that T-19® does not require FDA approval, we are prepared to immediately manufacture, market and distribute T-19®. We have a P-3 manufacturer ready to start production.
At this point we do not have clearance to manufacture T-19® without FDA approval. If we receive clearance this would be an immediate source of revenue for HTTD from the holistic market and the shareholders would be notified immediately. We do not want to jeopardize the regulatory approval of Tubercin® or proceed in any manner that could lead to unanticipated delays or expenses.
SALE OF RECYCLING ASSETS:
On May 21, 2004 it was announced that HTTD sold the assets of its recycling division for a secured promissory note of $250,000 and 20% ownership of the purchasing company. This sale was the best financial option for HTTD regarding the recycling assets. HTTD did not have the updated technology, the capital or resources in order to move the recycling division forward; we could not consummate a transaction with China or increase the domestic marketing of the division.
The assets were purchased by International Foam Solutions, Inc.,(“IFS”) a Nevada corporation controlled by Harvey Katz. Mr. Katz was the President of HTTD prior to the acquisition of Hard to Treat Diseases, Inc. and T-19, Inc. Certain shareholders have questioned the transaction as not being an arms length transaction or possibly an inside deal. The facts contradict any such concern.
First, the only other offer to purchase the recycling assets and technology was from Commonwealth Industries, Inc. for $190,000 in August 2003. Commonwealth decided not to purchase the assets, because the cost and time necessary to gain momentum in the polystyrene recycling industry was prohibitive.
Second, another alternative was to raise capital to acquire the technology, pay consultants, and continue or expand operations. This was discarded due to the cost of raising such capital for the recycling division when HTTD has committed itself to focusing on growing as a biotechnology company.
Third, the option HTTD pursued, is in management’s opinion, the best result for HTTD and its shareholders. The company will receive a $250,000 capital infusion over the next year. In addition, HTTD’s ownership of 20% of the recycling company will allow us to participate in the success of that company. We have every reasonable expectation that Mr. Katz’s fourteen years experience in the polystyrene industry is best put to use in growing International Foam Solutions instead of paying him as a consultant and trying to raise capital to expand a recycling division. IFS is currently in the process of attempting to finalize letters of intent with the Peoples Republic of China, with a private entity regarding dock recycling at the Lakes of the Ozarks in Missouri, and with the tobacco industry. IFS is also in the process of raising capital in order to expand operations and accelerate the payment due to HTTD. Thus, the expense of expanding IFS is borne by that company and not HTTD. As soon as a contract is signed that will generate revenue to HTTD, the shareholders will be notified immediately. Harvey Katz remains a consultant to HTTD in relation to the advancement of Tubercin®.
I have been and will continue to act as a watchdog over the operations of IFS to act in the best possible interests of HTTD and its ownership stake in IFS.
LITIGATION WITH SHINN—BACKGROUND:
HTTD is currently involved in litigation with its former CEO Ronald Shinn and former Secretary Gerry Knight, due to their transactions of questionable legality that were contrary to the interests of HTTD’s shareholders.
On May 2, 2003 International Foam Solutions, Inc.(“IFS”) completed a share exchange agreement with Shinn, and Oklahoma companies Hard to Treat Diseases, Inc.(“HTTD”) and T-19, Inc.(“T-19”). Shinn was to receive stock in IFS in return for 100 % of the stock in HTTD and T-19.
Pursuant to the share exchange agreement, Harvey Katz resigns as President and CEO and Shinn becomes President and CEO.
As a condition of the share exchange agreement, the name of the publicly traded entity owning all three companies was changed from International Foam Solutions, Inc. to Hard to Treat Diseases, Incorporated.
Pursuant to the share exchange agreement, on May 9, 2003 Shinn and his wife are issued 350 million restricted common stock shares of HTTD.
On June 30, 2003 Shinn issues himself an additional 175 million restricted common stock shares of HTTD.
On August 18, 2003 Shinn issues himself an additional 5 million restricted common stock shares of HTTD.
During his tenure as CEO of HTTD, Shinn stated to me and others that he was very interested in selling HTTD in order to convert his equity stake to cash.
We were unaware that the Tubercin® toxicity testing was completed on October 8, 2003 and that the results were favorable, but we later discovered that Shinn was aware of the results on October 8, 2003. On October 13, 2003, Shinn, his wife, and Knight resigned.
On October 15, 2003 Shinn, acting through his lawyer, sent a letter to HTTD through one of HTTD’s shareholders stating his intention to rescind and terminate the Share Exchange Agreement dated May 2, 2003. He also tendered the original stock certificates for the 530 million restricted shares of common stock. In essence, Shinn wanted to unravel the “merger” of a publicly traded company.
Hence, we are involved in litigation with Shinn. I’m confident the outcome will be favorable for HTTD or I would not be sitting where I am working for the shareholders.
SHINN’S 530 MILLION SHARES:
The original stock certificates for Shinn’s 530 million shares are in escrow, frozen and non-voting. The shares have not been cancelled yet, they are part of HTTD’s issued and outstanding stock! The certificates are not cancelled because they are part and parcel of the terms of the share exchange agreement, which is binding and provided the company with 100% share ownership in HTTD and T-19.
REPORTING ENTITY:
HTTD is currently on the “pink sheets” as a non-reporting entity. Our auditors cannot finalize HTTD’s audit for the year ended December 31, 2003, because Shinn has withheld the necessary documents regarding the companies we acquired. Of course this is part of our litigation with him.
Our goal is to become a reporting entity. This will add credibility to the company and give shareholders and potential investors a better understanding of HTTD.
WEBSITE:
On March 3, 2004 HTTD announced its new website that was professionally designed with “Flash” technology. Not much has been done with the website since then.
We have the foundation of a user friendly, informative and professional website. Commencing August 2, 2004 time and resources will be allocated for website development to make it a useful tool for shareholders and investors.
“CHAT ROOM” GOSSIP:
It seems there have been some far-fetched conspiracy theories circulating on some of the chat room message boards regarding HTTD. Certain shareholders have been kind enough to forward some of the theories to me. I’d like to state the following facts:
1) There is currently no investigation by the SEC or any other regulatory authority against HTTD, of which we are aware. If we are notified of any inquiry we will offer our full cooperation and assistance.
2) HTTD is not contemplating or in the process of filing bankruptcy.
3) HTTD restricted shares under Rule 144, with a holding period of at least one year, have been issued to me. I have not sold any HTTD shares to date nor do I intend to.
4) HTTD is not involved in the manipulation of its stock price nor does it exercise any control over the market. As discussed in our press release on December 5, 2003, third party individuals or entities have released information about the company. The company urges all shareholders and potential investors to review the company’s press releases and web site rather than relying on non-company disseminated information.
CONCLUSION:
HTTD is on track with the plan for the testing and advancement of Tubercin® and to be involved with a major pharmaceutical company within two years. HTTD will do nothing to jeopardize Tubercin® or the company. We are and will remain in complete compliance with FDA regulations, SEC compliance and all regulatory agencies. HTTD will keep its shareholders informed of all updates, vigorously protect the shareholder’s investments in the company and work aggressively in order for the shareholders to expeditiously begin to reap the benefits of our drug testing.
Feel free to call me if you have any questions or concerns regarding the company or my performance.
Sincerely,
Colm J. King
President and CEO
Hard to Treat Diseases, Incorporated
(561) 272-6900
This letter can also be viewed on our webste:www.htdsotc.com
AI
