<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 12b-25
NOTIFICATION OF LATE FILING
SEC FILE NUMBER
1-14227
CUSIP NUMBER
024377103
(Check One):
<TABLE>
<S> <C> <C> <C>
[ ] Form 10-K and Form 10-KSB [ ] Form 20-F [x] Form 10-Q and 10-QSB [ ] Form N-SAR
</TABLE>
For Period Ended: September 30, 1999
[ ] Transition Report on Form 10-K
[ ] Transition Report on Form 20-F
[ ] Transition Report on Form 11-K
[ ] Transition Report on Form 10-Q
[ ] Transition Report on Form N-SAR
For the Transition Period Ended:__________________________
_______________________________________Read
Attached Instruction Sheet Before Preparing Form. Please Print or Type.
Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein.
If the notification relates to a portion of the filing checked above, identify
the Item(s) to which the notification relates: N/A
PART I--REGISTRANT INFORMATION
Full Name of Registrant American Bank Note Holographics, Inc.
Former Name if Applicable
N/A
Address of Principal Executive Office (Street and Number)
399 Executive Boulevard
City, State and Zip Code Elmsford, New York 10523
PART II--RULES 12b-25 (b) AND (c)
If the subject report could not be filed without unreasonable effort or expense
and the registrant seeks relief pursuant to Rule12b-25(b), the following should
be completed. (Check box if appropriate)
[ x ] (a) The reasons described in reasonable detail in Part III of this form
could not be eliminated without unreasonable effort or expense;
[ ] (b) The subject annual report, semi-annual report, transition report on Form
10-K, Form 20-F, 11-K or Form N-SAR, or portion thereof will be filed on or
before the fifteenth calendar day following the prescribed due date; or the
subject quarterly report or transition report on Form 10-Q, or portion thereof
will be filed on or before the fifth calendar day following the prescribed due
date; and
[ ] (c) The accountant's statement or other exhibit required by 12b-25(c) has
been attached if applicable.
<PAGE> 2
PART III--NARRATIVE
State below, in reasonable detail, the reasons why Form 10-K and Form 10-KSB,
20-F, 11-K, 10-Q and 10-QSB, N-SAR, or the transition report or portion thereof
could not be filed within the prescribed period. (Attach Extra Sheets if Needed)
The Company has just completed the audit of its balance sheets at December 31,
1997 and 1998 and related statements of income, stockholders' equity and cash
flows for each of the three years in the period ended December 31, 1998. These
financial statements reflect restatements of the years ended December 31, 1996
and 1997, as well as adjustments to the unaudited results of the first three
quarters of 1998 previously reported by prior management. Until such restatement
was complete, the Company could not compile the financial information necessary
to complete its Form 10-Q in accordance with Regulation S-X in a timely manner
without reasonable effort and expense. It will now proceed to compile the
information necessary to complete its Form 10-Q.
PART IV--OTHER INFORMATION
(1) Name and telephone number of person to contact in regard to this
notification
Kenneth Traub (914) 592-2355
(Name) (Area Code) (Telephone Number)
(2) Have all other periodic reports required under Section 13 or 15(d) of the
Securities Exchange Act of 1934 or Section 30 of the Investment Company Act of
1940 during the preceding 12 months or for such shorter period that the
registrant was required to file such report(s) been filed? If the answer is no,
identify report(s).
[ ]Yes [ x ] No
The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998.
The Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended March 31, 1999.
The Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1999.
(3) Is it anticipated that any significant change in results of operations from
the corresponding period for the last fiscal year will be reflected by the
earnings statements to be included in the subject report or portion thereof?
[ x ]Yes [ ] No
If so: attach an explanation of the anticipated change, both narratively
and quantitatively, and, if appropriate, state the reasons why a reasonable
estimate of the results cannot be made.
Since the Company is in the process of compiling the information necessary
to complete its Form 10-Q, the Company cannot provide a reasonable estimate of
results at this time. The Company's response to this item, is supplemented by
the contents of the press releases issued by the Company on January 19, 1999,
January 25, 1999, February 1, 1999, February 4, 1999, March 26, 1999, April 9,
1999, April 15, 1999, July 21, 1999, September 30, 1999 and November 15, 1999.
Each of such press releases (other than the July 21, 1999, September 30, 1999
and November 15, 1999 press releases; a copy of the latter is attached hereto as
Exhibit A) was included as an Exhibit to a Current Report on Form 8-K (filed on
January 20, 1999, January 26, 1999, February 1, 1999, February 5, 1999, March
30, 1999, April 9, 1999 and April 16, 1999, respectively) and all such press
releases are hereby incorporated by reference herein.
American Bank Note Holographics, Inc.
(Name of Registrant as specified in charter)
has caused this notification to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: November 15, 1999 By: /s/ Kenneth Traub
----------------------------
Kenneth Traub, President
<PAGE> 3
EXHIBIT A
AMERICAN BANK NOTE HOLOGRAPHICS ANNOUNCES COMPLETION OF THE
AUDITS OF ITS FINANCIAL STATEMENTS FOR 1996, 1997 AND 1998
FINANCIAL STATEMENTS REFLECT ADJUSTMENTS TO 1996 AND 1997 AND
EACH OF THE QUARTERS OF 1998 PREVIOUSLY REPORTED BY PRIOR MANAGEMENT
ELMSFORD, N.Y. - NOVEMBER 15, 1999 - American Bank Note Holographics, Inc.
announced today that the Company's independent auditors, Deloitte & Touche LLP,
have completed the audits of the Company's balance sheets at December 31, 1997
and 1998 and the related statements of income, stockholders' equity and cash
flows for each of the three years in the period ended December 31, 1998. These
financial statements reflect restatements of the years ended December 31, 1996
and 1997 as well as adjustments to the unaudited results of the first three
quarters of 1998 previously reported by prior management.
The Company announced audited financial results for the years ended December 31,
1996 (restated), 1997 (restated) and 1998, as follows:
- - 1996 sales were $ 27.5 million. Net income was $4.3 million, or $0.32 per
share.
- - 1997 sales were $23.1 million. Net income was $2.8 million, or $0.21 per
share.
- - 1998 sales were $28.7 million. Net income was $1.1 million, or $0.08 per
share.
The Company's stockholders' equity as of December 31, 1998 was $14.5 million.
Kenneth Traub, President of the Company, said, "The restatement and audit of the
Company's historical financial statements was a substantial and time consuming
undertaking. Now that the restatement has been completed, we look forward to
bringing all of the Company's SEC filings current over the next several weeks
and moving on to other important priorities for the future."
Mr. Traub continued, "1999 was a transition year for American Bank Note
Holographics during which we addressed many of the most pressing issues facing
the Company, restored stability to the business, and began to focus on long-term
growth initiatives. We are proud of the progress we have made this year in a
challenging environment, and we look forward to continuing this progress and
enhancing our leadership position in the industry."
During 1999, the Company confronted a variety of challenges and achieved some
important milestones and accomplishments. The challenges included the following:
- In January, the Company disclosed that its previously issued financial
statements for 1996, 1997 and the first three quarters of 1998 all
required restatement. This gave rise either directly or indirectly to
several other issues that were significant to the Company.
<PAGE> 4
- The Company was notified by its commercial bankers, led by the Chase
Manhattan Bank, that it was in default on its bank debt. At the time
of the IPO, the Company was born with $5.2 million of secured bank
debt and nominal cash.
- The Chairman and Chief Executive Officer, the President and Chief
Operating Officer, the VP Finance, the Controller, and the VP
Operations all resigned from their positions with the Company.
- Class Action lawsuits were filed against the Company on behalf of
shareholders. The Securities and Exchange Commission and the United
States Attorney's office commenced investigations.
- The New York Stock Exchange suspended trading and indicated its
intention to seek the delisting of the Company's stock due to the
failure to file the required financial documents with the SEC. While
the Company does not expect its securities to resume trading on the
NYSE, the Company expects to seek to have its securities traded on
another stock exchange or NASDAQ when it becomes current with all of
its SEC filings.
- As a result of the above issues, the Company was under a great deal of
scrutiny by concerned customers, suppliers, employees, lenders,
shareholders, lawyers, regulators and others.
In light of these issues, the Company took a series of actions and achieved some
important accomplishments:
- The Audit Committee of the Company's Board of Directors conducted an
extensive investigation into the Company's prior management and
accounting practices.
- The Company recruited and built a strong new management team. Kenneth
Traub, President; Salvatore D'Amato, Chairman; Russell LaCoste,
Executive Vice President of Business Development and Marketing; Alan
Goldstein, Chief Financial Officer; George Condos, Controller; and
Peter Sorbo, Director of Research and Development and Engineering, all
joined or rejoined the Company in 1999.
- We negotiated an Amendment to the Loan Agreement with Chase which
waived the existing defaults, and then closed a refinancing with
Foothill Capital Corporation, which enabled the Company to repay the
Chase facility and improve its capital structure.
- We generated positive cash flow enabling us to reduce debt. We
accomplished this during a challenging period in which we had a
substantial amount of non-recurring expenditures relating to the
issues described above. Early in the year, we implemented improved
cost control and balance sheet management initiatives which helped us
achieve this cash flow and debt reduction.
- We restructured operations to improve accountability and reduce
expenses, including headcount reductions of approximately 50
employees. We believe we have been successful in retaining all of our
most important employees, and we have created a stronger, more
efficient workforce.
- We have implemented improved information and accounting systems.
<PAGE> 5
- We have been cooperating with the SEC and the U.S. Attorney in
connection with their investigations.
- We have made a lot of progress in restoring our reputation among our
customers and within our industry.
- We have succeeded in retaining the great majority of our customer
relationships and we have developed some important new customers.
- We have started to pursue new applications and markets for our
products. For instance, we believe there is an increasing demand for
holograms on bank notes (currency), and we have started to develop
improved solutions that better meet the needs and requirements of this
market.
- We have studied our patent rights and certain commercial agreements.
We succeeded in persuading a competitor to pay past due royalties in
excess of $800,000 that were owed from the fourth quarter of 1997
through the second quarter of 1999, and to resume future royalty
payments pursuant to a patent license agreement that the Company had
previously entered into. We believe our patent portfolio is very
valuable and we intend to continue to leverage the value of our
intellectual property and patent rights.
Mr. Traub continued, "This year, our priorities were to address the problems we
inherited and stabilize the business. While it was difficult, I believe we
accomplished much of what we needed to do this year, and we are now a stronger
company going into the year 2000. Our current priorities are to focus on
enhancing our reputation in the marketplace, continuing to improve product
quality and customer service, and seizing new product and market opportunities
to strengthen our leadership position in our industry."
Salvatore D'Amato, Chairman of the Board of the Company, added, "While it was
unfortunate to see the company that I started 18 years ago go through such a
difficult experience, I am delighted to be working closely with Ken to help
address the issues we inherited this year and position the company for the
future. We have a strong management team now that is committed to not only
moving the Company forward, but developing more of the innovative products and
programs on which American Bank Note Holographics has built its reputation. We
have accomplished a lot this year and I am excited about the opportunities for
the future."
American Bank Note Holographics is a leader in the origination, production, and
marketing of mass-produced secure holograms. The Company's products are used for
security applications, such as counterfeiting protection for credit and other
transaction cards, identification cards and documents of value, as well as for
tamper resistance and authentication of high-value consumer and industrial
products.
This news release includes forward-looking statements that involve risks and
uncertainties. Although the Company believes such statements are reasonable, it
can make no assurances that such statements will prove to be correct. Such
statements are subject to certain factors which may cause actual results to
differ materially from the forward-looking statements, including but
<PAGE> 6
not limited to, risks associated with our ability to resolve problems resulting
from the need to restate prior period financial statements; pending shareholder
litigation; competition in the market for holograms; retaining and attracting
key employees; and changes in business conditions which might impact customers
and suppliers. The Company undertakes no obligation to publicly release results
of any of these forward-looking statements to reflect events or circumstances
after the date hereof or to reflect the occurrence of unexpected results.
Contact:
American Bank Note Holographics, Inc.
Kenneth H. Traub
President
914-592-2355
# # #
<PAGE> 7
STATEMENTS OF INCOME
YEARS ENDED DECEMBER 31, 1998, 1997 (AS RESTATED) AND 1996 (AS RESTATED)
(IN THOUSANDS, EXCEPT SHARE DATA)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1998 1997 1996
---- ---- ----
<S> <C> <C> <C>
SALES $ 28,669 $ 23,085 $ 27,516
COSTS AND EXPENSES:
Cost of sales 19,064 12,153 14,710
Selling, general, administrative
and depreciation and amortization 7,371 6,949 5,852
-------- -------- --------
Total costs and expenses 26,435 19,102 20,562
-------- -------- --------
OPERATING INCOME 2,234 3,983 6,954
OTHER-Net:
Royalty income 554 785 128
Interest and other income (expense) (400) 182 373
-------- -------- --------
INCOME BEFORE INCOME TAXES 2,388 4,950 7,455
INCOME TAXES 1,269 2,130 3,117
-------- -------- --------
NET INCOME $ 1,119 $ 2,820 $ 4,338
======== ======== ========
NET INCOME PER SHARE:
Basic and diluted $ 0.08 $ 0.21 $ 0.32
======== ======== ========
</TABLE>
<PAGE> 8
BALANCE SHEETS
DECEMBER 31, 1998 AND 1997 (AS RESTATED)
(IN THOUSANDS)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS 1998 1997
---- ----
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 4,319 $ 253
Accounts receivable, net 4,023 5,897
Inventory, net 5,827 6,031
Deferred income taxes 1,777 708
Prepaid expenses and other 427 95
-------- --------
Total current assets 16,373 12,984
MACHINERY, EQUIPMENT AND
LEASEHOLD IMPROVEMENTS - Net 5,325 5,695
OTHER ASSETS 680 43
EXCESS OF COST OVER NET ASSETS ACQUIRED- Net 8,442 8,793
-------- --------
TOTAL ASSETS $ 30,820 $ 27,515
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Bank debt $ 5,591 $ 674
Current portion of notes payable 304 -
Accounts payable 4,376 2,244
Accrued expenses 2,619 1,382
Customer advances 1,460 -
-------- --------
Total current liabilities 14,350 4,300
OTHER LONG-TERM LIABILITIES,
INCLUDING NOTES PAYABLE 477 460
DEFERRED INCOME TAXES 1,463 1,590
-------- --------
Total liabilities 16,290 6,350
-------- --------
STOCKHOLDERS' EQUITY:
Common stock 136 136
Additional paid-in capital 11,627 11,627
Retained earnings 2,767 35,536
Due from former parent and affiliates - (26,134)
-------- --------
Total stockholders' equity 14,530 21,165
-------- --------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 30,820 $ 27,515
======== ========
</TABLE>
