U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 8-K/A
Amendment No. 1
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): March 20, 2000
Commission file number 0-26013
MULTI-LINK TELECOMMUNICATIONS, INC.
----------------------------------
(Exact name of small business issuer
as specified in its charter)
Colorado 84-1334687
------------------------------ -------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
4704 Harlan Street, Suite 420, Denver, CO 80212
-----------------------------------------------
(Address of principal executive offices)
(303) 831-1977
-------------------------
(Issuer's telephone number)
Not Applicable
---------------------------------------------------
(Former name, former address, and former fiscal year,
if changed since last report)
<PAGE>
This Form 8-K/A amends and supplements a filing by Multi-Link
Telecommunications, Inc. ("Multi-Link" or "Registrant") on Form 8-K, dated
January 20, 2000, pursuant to which Registrant reported the acquisition of
substantially all of the assets of One Touch Communications, Inc., a Georgia
corporation, by One Touch Communications, Inc., a Colorado corporation and
wholly owned subsidiary of Multi-Link. Such Form 8-K is hereby amended by
changing Item 7 thereof to read as follows, and filing herewith the attached
financial statements and information.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Financial Statements of Business Acquired.
The following financial statements of the business acquired are filed
herewith:
Audited financial statements of One Touch Communications, Inc., for
the twelve-month periods ended December 31, 1998 and December 31,
1999.
(b) Pro Forma Financial Information.
The following pro forma financial statements of the Registrant are filed
herewith:
Unaudited pro forma combining, condensed balance sheet of Multi-Link
Telecommunications, Inc. as at September 30, 1999, Hellyer
Communications, Inc. as at October 31, 1999 and One Touch
Communications, Inc., as at December 31, 1999.
Unaudited pro forma combining, condensed statement of operations of
Multi-Link Telecommunications, Inc. for the year ended September 30,
1999, Hellyer Communications, Inc. for the year ended October 31,
1999, and One Touch Communications, Inc., for the year ended December
31, 1999.
(c) Exhibits.
10.19 Agreement for Sale and Purchase of Assets dated December 22,
1999, by and among One Touch Communications, Inc., Eric C.
Beguelin, David G. Webster, Multi-Link Telecommunications,
Inc., and One Touch Communications, Inc., a Colorado
corporation and wholly owned subsidiary of Multi-Link (without
exhibits).*
98.1 Press Release. **
* Incorporated by reference from Exhibit 10.19 contained in the Company's Annual
Report on Form 10-KSB filed December 28, 1999.
** Filed with the Form 8-K on January 20, 2000.
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 thereunto duly authorized.
MULTI-LINK TELECOMMUNICATIONS, INC.
Date: March 20, 2000 By: /s/ David J. Cutler
----------------------------------------
David J. Cutler, Chief Financial Officer
2
<PAGE>
ONE TOUCH COMMUNICATIONS, INC.
Financial Statements
December 31, 1999 and 1998
with
Independent Auditors' Report
3
<PAGE>
TABLE OF CONTENTS
Page
----
Independent Auditors' Report............................................ 5
Balance Sheets.......................................................... 6
Statements of Income.................................................... 7
Statements of Changes in Stockholders' Equity........................... 8
Statements of Cash Flows................................................ 9
Notes to Financial Statements........................................... 10
4
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
One Touch Communications, Inc.
We have audited the accompanying balance sheets of One Touch
Communications, Inc. (an S Corporation) at December 31, 1999 and 1998, and the
related statements of income, changes in stockholders' equity, and cash flows
for the years then ended. These financial statements are the responsibility of
the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of One Touch Communications,
Inc. as of December 31, 1999 and 1998, and the results of its operations and
cash flows for the years then ended in conformity with generally accepted
accounting principles.
/s/ Gifford, Hillegass & Ingwersen, P.C.
GIFFORD, HILLEGASS & INGWERSEN, P.C.
Atlanta, Georgia
February 22, 2000
5
<PAGE>
<TABLE>
<CAPTION>
ONE TOUCH COMMUNICATIONS, INC.
BALANCE SHEETS
December 31, 1999 and 1998
1999 1998
---- ----
<S> <C> <C>
ASSETS
Current assets
Cash ................................................................. $ 6,735 $ 5,125
Accounts receivable .................................................. 40,651 45,960
Advances to shareholder .............................................. 0 20,773
Other current assets ................................................. 3,625 16,877
--------- ---------
Total current assets ................................................. 51,011 88,735
Property and equipment, net (Notes C, D and F) ................................ 173,693 279,133
Other assets
Lease deposits ....................................................... 14,164 4,237
--------- ---------
TOTAL ASSETS ......................................................... $ 238,868 $ 372,105
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued expenses ................................ $ 2,929 $ 12,100
Notes payable (Note D) ............................................... 0 29,750
Current portion of capital lease obligations (Note F) ................ 44,117 42,900
--------- ---------
Total current liabilities ............................................ 47,046 84,750
Capital lease obligations, less current portion (Note F) ...................... 62,203 95,163
Stockholders' equity
Class A common stock, voting, $1 par value
10,000 shares authorized, 9,000 shares issued
and outstanding ................................................. 9,000 9,000
Class B common stock, nonvoting, $1 par value
10,000 shares authorized, 1,000 shares issued ................... 1,000 1,000
Additional paid-in capital ........................................... 7,200 7,200
Retained earnings .................................................... 112,619 175,192
Treasury stock, 1,000 shares Class B, at cost ........................ (200) (200)
--------- ---------
Total stockholders' equity ........................................... 129,619 192,192
--------- ---------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY ............................................ $ 238,868 $ 372,105
========= =========
</TABLE>
See accompanying notes.
6
<PAGE>
<TABLE>
<CAPTION>
ONE TOUCH COMMUNICATIONS, INC.
STATEMENTS OF INCOME
Years Ended December 31, 1999 and 1998
1999 1998
---- ----
<S> <C> <C>
Revenue .................................................. $ 1,186,383 $ 914,682
Cost of services ......................................... 266,606 218,950
--------- ----------
Gross profit .................................... 919,777 695,732
Operating expenses
Salaries and benefits ........................... 341,031 292,623
General and administrative ...................... 170,402 156,085
Rent expense .................................... 49,770 51,335
Selling and marketing ........................... 13,840 14,694
--------- ----------
Total operating expenses ........................ 575,043 514,737
--------- ----------
Net income from operations ...................... 344,734 180,995
Other income (expense)
Interest expense ................................ (15,268) (25,267)
Other income .................................... 34,918 25,979
--------- ----------
Net other income ................................ 19,650 712
--------- ----------
Net income ............................................... $ 364,384 $ 181,707
</TABLE>
See accompanying notes.
7
<PAGE>
<TABLE>
<CAPTION>
ONE TOUCH COMMUNICATIONS, INC.
STATEMENTS OF STOCKHOLDERS' EQUITY
Years Ended December 31, 1999 and 1998
Common Stock Additional
----------------------- Paid-in Retained Treasury
Balance Class A Class B Capital Earnings Stock Total
------- ------- ------- ---------- -------- -------- -----
<S> <C> <C> <C> <C> <C> <C>
December 31, 1997 ............... 9,000 1,000 7,200 203,485 (200) 220,485
Net Income ...................... 0 0 0 181,707 0 181,707
Distributions ................... 0 0 0 (210,000) 0 (210,000)
December 31, 1998 ............... 9,000 1,000 7,200 175,192 (200) 192,192
Net Income ...................... 0 0 0 364,384 0 364,384
Distributions ................... 0 0 0 (426,957) 0 (426,957)
December 31, 1999 ............... 9,000 1,000 7,200 112,619 (200) 129,619
</TABLE>
8
<PAGE>
<TABLE>
<CAPTION>
ONE TOUCH COMMUNICATIONS, INC.
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1999 and 1998
1999 1998
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income ................................................................ $ 364,384 $ 181,707
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation and amortization ......................................... 92,377 93,615
Gain on disposal of assets ............................................ (13,061) (4,323)
Decrease (increase) in accounts receivable ............................ 5,309 (4,755)
Decrease (increase) in other current assets ........................... 13,252 5,820
Increase in deposits .................................................. (9,927) (547)
Increase (decrease) in accounts payable ............................... (9,171) 5,206
--------- ---------
Net cash provided by operating activities ...................................... 443,163 276,723
--------- ---------
Cash flows from investing activities:
Additions to property and equipment ....................................... (12,790) (110,817)
Proceeds from disposal of assets .......................................... 47,410 67,710
--------- ---------
Net cash provided (required) by investing activities .................. 34,620 (43,107)
--------- ---------
Cash flows from financing activities:
Repayment of capital lease obligations .................................... (40,239) (34,252)
Increase (decrease) in due from officer ................................... 20,773 (12,023)
Principal payments on long-term debt ...................................... (29,750) (18,494)
Distributions to shareholders ............................................. (426,957) (210,000)
--------- ---------
Net cash required by financing activities ............................. (476,173) (274,769)
--------- ---------
Net increase (decrease) in cash ....................................... 1,610 (41,153)
Cash, beginning of year ........................................................ 5,125 46,278
--------- ---------
Cash, end of year .............................................................. $ 6,735 5,125
========= =========
Supplemental disclosure of cash flow information:
Cash paid during the year for interest .................................... $ 15,268 $ 25,267
========= =========
Noncash investing and financing activities:
Equipment purchased under capital lease obligations ................... $ 8,496 $ 24,000
========= =========
</TABLE>
See accompanying notes.
9
<PAGE>
NOTES TO FINANCIAL STATEMENTS
December 31, 1999 and 1998
NOTE A - NATURE OF BUSINESS
The Company was incorporated in the state of Georgia on November 25, 1995. The
Company operates a telecommunication business in Raleigh, North Carolina.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Management Estimates
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments with maturity dates of
three months or less to be cash equivalents.
Receivables
The Company uses the allowance method to provide for recognition of bad
debt. As of December 31, 1999 and 1998, the allowance for doubtful accounts
amounted to $15,000.
Property and Equipment
Property and equipment are stated at cost. Maintenance and repairs are
charged to expense as incurred, and renewals and betterments are capitalized.
Provisions for depreciation are charged to income over the estimated useful
lives of the assets using the straight-line method of depreciation. The
estimated useful lives are as follows:
Computer equipment and pagers 3 years
Equipment and vehicles 5 years
Furniture and fixtures 7 years
Revenue
Revenue from sales and service is recognized when the service is delivered.
Advertising Costs
The Company expenses advertising costs as they are incurred.
10
<PAGE>
Income Taxes
The Company has elected to be taxed as an S Corporation; therefore, the income
tax obligations and benefits are passed through to the individual shareholders.
NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The Value of Financial Instruments
The carrying amounts of cash, receivables, and payables approximate fair value
because of the short maturity of these instruments.
NOTE C - PROPERTY AND EQUIPMENT
At December 31, 1999 and 1998, property and equipment consisted of:
1999 1998
---- ----
Equipment $246,449 $246,449
Pagers 75,744 68,291
Computer equipment 31,812 20,603
Vehicles 28,000 81,168
Furniture and fixtures 13,448 13,448
------ ------
395,453 429,959
Less accumulated depreciation (221,760) (150,826)
-------- --------
$173,693 $279,133
At December 31, 1999 and 1998 equipment includes equipment under capital leases
amounting to $213,866 and $205,370 with accumulated amortization of $118,655 and
$76,165, respectively.
NOTE D - NOTES PAYABLE
At December 31, 1998, the Company had an 8.5% note payable to a financial
institution with $26,238 outstanding balance. The note was collateralized by a
vehicle. In addition, the Company had an 8% note payable to a vendor with a
remaining balance of $3,512. Both notes were paid in their entirety during 1999.
NOTE E - RELATED PARTY TRANSACTIONS
As of December 31, 1998 the Company had outstanding advances of $20,773 due from
a shareholder. This amount was repaid during 1999.
During 1999 the Company sold a vehicle to a shareholder for its net book value
of $3,691.
11
<PAGE>
NOTE F - LEASE OBLIGATIONS
The following is a schedule of future minimum rentals of equipment under capital
leases, together with the present value of the net minimum lease payments as of
December 31, 1999:
Year ending
-----------
2000 $ 64,119
2001 40,956
2002 11,785
2003 5,531
2004 188
--------
Total minimum lease payments $122,579
Less amount representing interest (16,259)
--------
Present value of minimum lease payments $106,320
========
The Company leases office space under a non-cancelable operating lease which
expires in May 2001. The lease provides for a three year renewal option. Minimum
rents due under this agreement are as follows:
Year ending
-----------
2000 $ 50,061
2001 21,115
The Company subleases a portion of its office space on a month to month
basis. Rent income for 1999 and 1998 amounted to $21,405 and $20,892,
respectively.
NOTE G - SEGMENT INFORMATION
The Company's activities are conducted in one operating segment with all
activities relating to providing telecommunication services in the Raleigh,
North Carolina area.
NOTE H - SUBSEQUENT EVENTS
Effective January 5, 2000 the Company sold substantially all of its assets and
operations to Multi-Link Telecommunications, Inc. One Touch Communications, Inc.
then changed its name to E&D, Inc. Current plans are to liquidate E&D, Inc. by
December 2000.
12
<PAGE>
NOTE I - PENDING ACCOUNTING PRONOUNCEMENTS
In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities. As amended by SFAS
No. 137, the effective date is for all fiscal quarters of all fiscal years
beginning after June 15, 2000. This Statement establishes accounting and
reporting standards for derivative instruments and hedging activities.
Management does not believe that the adoption of this statement will be material
to the financial statements.
13
<PAGE>
MULTI - LINK TELECOMMUNICATIONS, INC.
HELLYER COMMUNICATIONS, INC.
and
ONE TOUCH COMMUNICATIONS, INC.
INTRODUCTION
The accompanying unaudited pro forma combining, condensed balance sheet combines
the balance sheet of Multi - Link Telecommunications, Inc. ('the Company") as at
September 30, 1999, the balance sheet of Hellyer Communications, Inc.
('Hellyer') as at October 31, 1999 and the balance sheet of One Touch
Communications, Inc. ('One Touch') as at December 31, 1999.
The accompanying unaudited pro forma combining, condensed statement of
operations combine the operations of the Company for the year ended September
30, 1999, the operations of Hellyer for the year ended October 31, 1999 and the
operations of One Touch for the year ended December 31, 1999 as if the
acquisitions had been completed at the beginning of the period presented under
the purchase method of accounting and based upon the assumptions as included in
the notes to the proforma statements.
These statements are not necessarily indicative of future operations or the
actual results that would have occurred had the merger been consummated at the
beginning of the period indicated.
The unaudited pro forma combined, condensed financial statements should be read
in conjunction with the historical financial statements and notes thereto,
included elsewhere in the document.
14
<PAGE>
MULTI - LINK TELECOMMUNICATIONS, INC.
HELLYER COMMUNICATIONS, INC.
and
ONE TOUCH COMMUNICATIONS, INC.
NOTES TO PROFORMA COMBINING, CONDENSED FINANCIAL
INFORMATION
HELLYER COMMUNICATIONS, INC.
(A) To reflect the cash purchase consideration for the acquisition of the
business and assets of Hellyer Communications, Inc ('Hellyer') allocated as
the partial repayment of Hellyer's Notes Payable and Accounts Payable and
acquisition costs.
(B) To reflect the write down of assets acquired from Hellyer to fair market
value in respect of property improvements that will not be transferred with
the existing business, equipment that will need to be replaced shortly
after the acquisition because of technical obsolescence and office
furniture in excess of ongoing requirements.
(C) To reflect the transfer of deferred acquisition costs to the value of
goodwill arising on the acquisition of the Hellyer business.
(D) To reflect the value of:
1) Consultancy and non-compete agreements acquired on the
acquisition of Hellyer in consideration of the issue of
150,000 shares in Multi - Link Telecommunications, Inc
('the Company').
2) Goodwill arising on the acquisition of the Hellyer
business.
(E, F, G H) To reflect the write down of Accounts Payable, Accrued Costs
and Notes Payable agreed to by the Creditors of Hellyer as part of the
terms and conditions of the acquisition of the Hellyer business.
(I) To reflect the impact of the above transactions on shareholders' equity
(J) To reflect the costs of amortizing the consultancy agreement (2 years),
non-compete agreement (5 years) and goodwill (15 years).
(K) To reflect the impact of the reduction interest expense arising from the
agreed write off Hellyer Notes Payable.
15
<PAGE>
(L) To reflect the impact of the issue of 150,000 shares in the Company for the
acquisition of Consultancy and Non Compete agreements.
ONE TOUCH COMMUNICATIONS, INC.
(M) To reflect the cash purchase consideration for the acquisition of the
business and assets of One Touch Communications, Inc. allocated as
repayment of lease commitments, both current and long-term, payment of
certain purchase commitments for fixed assets and purchase consideration.
(N) To revalue assets to fair market value and reflect the purchase of fixed
assets which One Touch was committed to purchase at year-end.
(O) To reflect the value of goodwill arising on the acquisition of the One
Touch business.
(P) To reflect the repayment of all of One Touch's outstanding lease
liabilities at closing.
(Q) The reflect the net impact of issuing $2,020,000 equity as partial
consideration for the acquisition of the business and assets of One Touch
less the elimination of the existing shareholders equity in the 'old' One
Touch business.
(R) To reflect the cost of amortizing goodwill on the acquisition of the One
Touch business over fifteen year.
(S) To reflect the reduction in interest expense arising from the repayment in
full of all of One Touch's leasing liabilities at closing.
(T) To reflect the impact of the issue of 246,718 shares in the Company issued
as part of the purchase consideration for the acquisition of the One Touch
business and assets.
16
<PAGE>
<TABLE>
<CAPTION>
MULTI - LINK TELECOMMUNICATIONS, INC., HELLYER COMMUNICATIONS, INC. AND ONE TOUCH COMMUNICATIONS, INC.
PROFORMA, COMBINED, CONDENSED BALANCE SHEET
AS AT SEPTEMBER, 30 1999
(UNAUDITED)
Multi-Link Hellyer One Touch
Telecommunications, Inc Communications, Inc Communications, Inc
ASSETS ----------------------- ------------------- --------------------
<S> <C> <C> <C>
Current Assets
Cash and cash equivalents ......................... $ 512,617 $ 26,698 $ 6,735
Marketable securities, current .................... 3,397,002 0 0
Accounts receivable ............................... 265,419 63,960 40,651
Inventory ......................................... 0 22,389 0
Prepaid expenses .................................. 51,234 0 17,789
----------- ----------- -----------
4,226,272 113,047 65,175
Marketable Securities ............................. 386,357 0 0
----------- ----------- -----------
Property and Equipment, net ....................... 1,184,653 1,686,136 173,693
Other Assets:
Deferred financing and offering costs ............. 159,430 0 0
Intangible assets, less amortization .............. 715,882 0 0
----------- ----------- -----------
Total Assets ...................................... $ 6,672,594 $ 1,799,183 $ 238,868
LIABILITIES AND STOCKHOLDER"S EQUITY
Current Liabilities
Accounts payable .................................. $ 117,373 $ 1,576,659 $ 2,929
Accrued expenses .................................. 50,647 1,244,470 0
Deferred revenue .................................. 164,091 155,956 0
Notes payable - related parties, current portion .. 17,569 0 0
Notes payable and current portion ................. 160,424 1,353,155 44,117
of long term debt
----------- ----------- -----------
Total current liabilities ......................... 510,104 4,330,240 47,046
Long - Term Debt, less current portion ............ 341,011 1,479,503 62,203
Stockholders' Equity .............................. 5,821,479 (4,010,560) 129,619
----------- ----------- -----------
Total Liabilities and Stockholders' Equity ........ $ 6,672,594 $ 1,799,183 $ 238,868
17(a)
<PAGE>
<CAPTION>
Hellyer One Touch
Pro Forma Pro Forma Pro Forma
Adjustments Adjustments Combined
----------- ----------- ---------
<S> <C> <C> <C>
Cash and cash equivalents ......................... $ 0 $ 0 $ 546,050
Marketable securities, current .................... (1,057,000) (A) (1,125,520) (M) 1,214,482
Accounts receivable ............................... 0 0 370,030
Inventory ......................................... 0 0 22,389
Prepaid expenses .................................. 0 0 69,023
----------- ----------- -----------
(1,057,000) (1,125,520) 2,221,974
Marketable Securities ............................. 0 0 386,357
Property and Equipment, net ....................... (428,105) (B) 153,507 (N) 2,769,884
Other Assets:
Deferred financing and offering costs ............. (50,000) (C) 0 109,430
Intangible assets, less amortization .............. 2,883,987 (D) 2,756,074 (O) 6,355,943
----------- ----------- -----------
Total Assets ...................................... $ 1,348,882 $ 1,784,061 $11,843,588
LIABILITIES AND STOCKHOLDER"S EQUITY
Current Liabilities
Accounts payable .................................. ($1,159,915) (E) 0 $ 537,046
Accrued expenses .................................. (790,472) (F) 0 504,645
Deferred revenue .................................. 0 0 320,047
Notes payable - related parties, current portion .. 0 0 17,569
Notes payable and current portion ................. (1,263,155) (G) (44,117) (P) 250,424
of long term debt
----------- ----------- -----------
Total current liabilities ......................... (3,213,542) 0 1,629,731
Long - Term Debt, less current portion ............ (464,031) (H) (62,203) (P) 1,356,483
Stockholders' Equity .............................. 5,026,455 (I) 1,890,381 (Q) 8,857,374
----------- ----------- -----------
Total Liabilities and Stockholders' Equity ........ $ 1,348,882 $ 1,828,178 $11,843,588
</TABLE>
See Accompanying Notes to Combining, Condensed Financial Information.
17(b)
<PAGE>
<TABLE>
<CAPTION>
MULTI - LINK TELECOMMUNICATIONS, INC., HELLYER COMMUNICATIONS, INC. AND ONE TOUCH COMMUNICATIONS, INC.
PROFORMA, COMBINED, CONDENSED STATEMENT OF OPERATIONS FOR THE TWELVE MONTHS ENDED SEPTEMBER 30, 1999
(UNAUDITED)
Multi-Link Hellyer One Touch
Telecommunications, Inc Communications, Inc Communications, Inc
----------------------- ------------------- --------------------
<S> <C> <C> <C>
Net Revenues ....................................... $ 2,217,468 $ 8,789,124 $ 1,186,383
Cost of Services and Products ...................... 410,623 3,181,876 266,606
Gross margin ....................................... 1,806,845 5,607,248 919,777
Operating expenses ................................. 1,215,256 9,774,454 540,125
Operating Income (loss) ............................ 591,589 (4,167,206) 379,652
Interest expense ................................... (200,330) (389,531) (15,268)
------------ ----------- -----------
Net Income (loss) .................................. $ 391,259 ($ 4,556,737) $ 364,384
Net Income (loss) Per Common Share:
Basic .................................... $ 0.18 n/a n/a
Diluted .................................. $ 0.16 n/a n/a
Weighted Average Number of Shares:
Basic .................................... 2,203,992
Diluted .................................. 2,400,075
<CAPTION>
Hellyer One Touch
Pro Forma Pro Forma Pro Forma
Adjustments Adjustments Combined
----------- ----------- ---------
<S> <C> <C> <C>
Net Revenues ....................................... $ 0 $ 0 $ 12,192,975
Cost of Services and Products ...................... 0 0 3,859,105
Gross margin ....................................... 0 0 8,333,870
Operating expenses ................................. 229,297 (J) 183,738 ( R) 11,942,871
Operating Income (loss) ............................ (229,297) (183,738) (3,609,001)
Interest expense ................................... 138,862 (K) 15,268 (S) (450,998)
------------ ----------- -----------
Net Income (loss) .................................. ($ 90,435) ($ 168,470) ($ 4,059,999)
Net Income (loss) Per Common Share:
Basic .................................... n/a n/a ($ 1.56)
Diluted .................................. n/a n/a ($ 1.56)
Weighted Average Number of Shares:
Basic .................................... 150,000 (L) 246,718 (T) 2,600,710
Diluted .................................. 150,000 (L) 246,718 (T) 2,600,710
</TABLE>
See Accompanying Notes to Combining, Condensed Financial Information
18
