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UNITED STATES Page 1 of 9
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
(Mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: JANUARY 31, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 06425
AMACAN RESOURCES CORPORATION
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(Exact name of registrant as specified in its charter)
Utah 87-0284979
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(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
1399 South Seventh East
Salt Lake City, Utah 84105
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (801) 486-9911
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Not Applicable
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes X No
--- ---
State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date.
Class Outstanding at February 29, 1996
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Common capital stock, $.25
par value 2,723,714
Transitional Small Business Disclosure Format (check one):
Yes No X
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PART I. FINANCIAL INFORMATION Page 2 of 9
ITEM I. FINANCIAL STATEMENTS
AMACAN RESOURCES CORPORATION
Condensed Consolidated Balance Sheets
January 31, 1996 and April 30, 1995
(Unaudited)
<TABLE>
<CAPTION>
January 31, April 30,
1996 1995
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<S> <C> <C>
ASSETS
------
Current assets:
Cash $ 56,523 $ 84,851
Investments-Certificate of deposit 454,119 436,686
Accounts receivable 13,281 18,711
------- -------
Total current assets 523,923 540,248
Interest in oil and gas properties,
mining claims and equipment, at cost
net of accumulated depreciation and
depletion at January, 1996 and April,
1995 of $3,333,921 and $3,305,850,
respectively 224,213 250,505
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$748,136 $790,753
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LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable and accrued
liabilities $ 78,584 $ 42,940
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Total current liabilities 78,584 42,940
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Deferred compensation payable 15,150 38,210
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Stockholders' equity:
Capital stock 680,929 680,929
Additional paid-in capital 89,504 89,504
Retained earnings (deficit) (116,031) (60,830)
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Total stockholders' equity 654,402 709,603
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$748,136 $790,753
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------- -------
</TABLE>
See accompanying notes to financial statements.
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Page 3 of 9
AMACAN RESOURCES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months and Nine Months Ended January 31, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
January 31, January 31,
----------- -----------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenue:
Oil and gas $ 33,718 $ 46,740 $108,850 $142,944
Interest income 3,750 6,252 17,434 14,922
------- ------- ------- -------
Total revenue 37,468 52,992 126,284 157,866
------- ------- ------- -------
Costs and expenses:
Depreciation and depletion 8,889 13,134 28,071 38,091
Operating costs 14,675 14,476 43,013 43,405
Taxes other than income taxes 4,162 6,022 14,199 18,850
Other costs and expenses 56,067 22,220 95,299 59,251
------- ------- ------- -------
Total costs and expenses 83,793 55,852 180,582 159,597
------- ------- ------- -------
Earnings (loss) before provision
for taxes (46,325) (2,860) (54,298) (1,731)
Provision for income taxes - - (903) (1,123)
------- ------- ------- -------
Net (loss) earnings (46,325) (2,860) (55,201) (2,854)
Retained earnings (deficit),
beginning (69,706) (49,442) (60,830) (49,448)
------- ------- ------- -------
Retained earnings (deficit),
ending $(116,031) $(52,302) $(116,031) $(52,302)
------- ------- ------- -------
------- ------- ------- -------
Earnings (loss) per share $ (.0170) $ (.0010) $ (.0203) $ (.0010)
------- ------- ------- -------
------- ------- ------- -------
Dividends None None None None
Average shares outstanding 2,723,714 2,723,714 2,723,714 2,723,714
Sales of unregistered
securities None None None None
</TABLE>
See accompanying notes to financial statements.
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Page 4 of 9
AMACAN RESOURCES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended January 31, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) $(55,201) $ (2,854)
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Adjustments to reconcile
net earnings to cash
provided by operating activities:
Depreciation, depletion
and amortization 28,071 38,091
(Increase) decrease in
accounts receivable 5,430 (4,191)
Increase (decrease) in
accounts payable and
accrued liabilities 35,644 7,637
Increase (decrease) in
deferred compensation (23,060) (17,177)
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Total adjustments 46,085 24,360
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Net cash provided (used) by operating
activities (9,116) 21,506
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Cash flows from investing activities:
Capital expenditures (1,779) (11,592)
Investments in certificate of deposit (17,433) (432,949)
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Net cash used in investing activities (19,212) (444,541)
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Increase (decrease) in cash and
cash equivalents (28,328) (423,035)
Cash and cash equivalents,
beginning of year 84,851 502,861
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Cash and cash equivalents,
end of year $ 56,523 $ 79,826
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------- -------
</TABLE>
See accompanying notes to financial statements.
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Page 5 of 9
AMACAN RESOURCES CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
January 31, 1996
(Unaudited)
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-QSB
and Item 310(b) of Regulation S-B. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. Operating
results for the nine months ended January 31, 1996 are not necessarily
indicative of the results that may be expected for the year ended April 30,
1996. The unaudited condensed consolidated financial statements should be
read in conjunction with the consolidated financial statements and
footnotes thereto included in the Company's annual report on Form 10-KSB
for the year ended April 30, 1995.
NOTE B -- SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
The Company paid cash of $1,615 and $903 during the period ended January
31, 1996 for interest and income taxes, respectively.
For the same period ended January 31, 1995, the Company paid cash of $2,959
for interest and $1,123 for taxes.
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Page 6 of 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
GENERAL CONDITION
The Company's principal activities have consisted of production from oil and gas
reserves during the interim period since April 30, 1995.
On January 23, 1996, the Company entered into an Agreement and Plan of
Reorganization (the "Agreement") among the Company, Spire Technologies, Inc.
("Spire"), Spire Technologies Systems Division, Inc. ("Spire Systems," and
collectively with Spire, the "Spire Companies") and the holders of all of the
capital stock of the Spire Companies, pursuant to which, among other things, the
Company will acquire all of the outstanding shares of the Spire Companies in
exchange for the issuance of an aggregate of 3,501,883 shares of the Company's
Common Stock (which will represent approximately 90% of the outstanding shares
of the Company's Common Stock following the transaction). The Agreement and
transactions contemplated thereby are subject to certain conditions, including
the approval of the Company's shareholders. The transaction was reported by the
Company on Form 8-K dated January 30, 1996, which is incorporated herein by
reference.
The Spire Companies operate together as a value added reseller of network
computer systems and components, a developer and seller of certain office
automation software products and a "service and value added reseller" and
distributer of software developed by third parties. Accordingly, if the
transactions contemplated by the Agreement are consummated, the principal
business and operations of the Company will become the business and operations
presently conducted by the Spire Companies and will be substantially different
than the current business and operations of the Company.
LIQUIDITY AND CAPITAL RESOURCES
The Company's liquidity is provided by revenue from participation in oil and gas
operations, and historically by long-term debt provided by bank loans, and
issues of capital stock. The Company has during the last nine months been able
to generate sufficient cash to pay for its share of expenses associated with
production of the Company's interest in oil and gas reserves.
The Company anticipates that its oil and gas operations during the 1995-96
fiscal year can be adequately financed through its share of revenues from such
operations. The Company has no long term commitments for capital expenditures
for its current operations.
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Page 7 of 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED
LIQUIDITY AND CAPITAL RESOURCES, CONTINUED
The Company is seeking to diversify its business through the Agreement and
transactions described above with the Spire Companies. In the event the
Agreement is finalized, the Company's oil and gas operations will be a nominal
part of the combined entity. Accordingly, financial arrangements and
requirements will be based upon the combined requirements.
RESULTS OF OPERATIONS - QUARTERS ENDED JANUARY 31, 1996 AND 1995
During the most recent quarter, the Company reported a net loss of $46,325
compared with a net loss of $2,860 for the same quarter of the prior year. The
significant reasons are discussed below:
REVENUE
OIL AND GAS REVENUE - decreased (from $46,740 to $33,718) primarily
because of decreased production of the Company's oil and gas reserves.
INTEREST INCOME - decreased (from $6,252 to $3,750) because of
decreased rates earned on principal invested during the most recent
quarter.
COST AND EXPENSES
DEPRECIATION AND DEPLETION - decreased (from $13,134 to $8,889)
because of decreased production of the Company's oil and gas reserves
on which this cost is based.
OPERATING COSTS - did not materially differ from the comparable
quarter of the prior year.
TAXES OTHER THAN INCOME TAXES - decreased (from $6,022 to $4,162)
because of decreased production subject to production taxes.
OTHER COSTS AND EXPENSES - increased (from $22,220 to $56,067)
primarily because of increased fees for legal and accounting
professionals. During the quarter ended January, 1996, the Company
expended $42,237 in connection with a proposed business combination.
There were no comparable expenditures by the Company in the prior
year.
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Page 8 of 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS, CONTINUED
RESULTS OF OPERATIONS, NINE MONTHS ENDED JANUARY 31, 1996 AND 1995
During the most recent nine months the Company reported a net loss of $55,201
compared with a net loss of $2,854 for the comparable nine months of the
preceding year. The significant reasons follow:
REVENUE
OIL AND GAS REVENUE - decreased (from $142,944 to $108,850) primarily
because of decreased production of the Company's oil and gas reserves.
INTEREST INCOME - increased (from $14,922 to $17,434) because of
increased principal amounts for investments in certificates of
deposit.
COST AND EXPENSES
DEPRECIATION AND DEPLETION - decreased (from $38,091 to $28,072)
because of decreased production of the Company's oil and gas reserves
on which depreciation and depletion cost is based.
OPERATING COSTS - did not materially differ from the comparable nine
months of the immediately preceding year.
TAXES OTHER THAN INCOME TAXES - decreased (from $18,850 to $14,199) in
the current period because of decreased revenue subject to taxes in
states requiring the payment of production taxes compared with the
comparable nine months of the immediately preceding year.
OTHER COSTS AND EXPENSES - increased (from $59,251 to $95,299) because
of increased fees for legal and accounting professionals. During the
nine months ended January, 1996, the Company expended $42,237 in
connection with a proposed business combination. There were no
comparable expenditures by the Company in the prior year.
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Page 9 of 9
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8K
(a) Exhibits:
Reg. S-K
Exhibit No. Description
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2.1* Agreement and Plan of Reorganization
27 Financial Data Schedule (EDGAR)
99 Current Report on Form 8-K dated
January 30, 1996
-------------------------------
* Incorporated by reference to Exhibit No. 1 of the
Company's current Report on Form 8-K.
(b) Reports on 8K:
A current Report on Form 8-K was filed on January 30, 1996 reporting
the Agreement to acquire the outstanding shares of the Spire Companies
as discussed above.
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMACAN RESOURCES CORPORATION
----------------------------
(Registrant)
By Lamar H. Holley
--------------------------
Lamar H. Holley, Vice President
and Chief Financial Officer
Date: March 14, 1996
--------------
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM AMACAN
RESOURCES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET AND STATEMENT OF
OPERATIONS AS OF AND FOR THE NINE MONTHS ENDED JANUARY 31, 1996 AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> APR-30-1996
<PERIOD-START> MAY-01-1995
<PERIOD-END> JAN-31-1996
<CASH> 56,523
<SECURITIES> 454,119
<RECEIVABLES> 13,281
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 523,923
<PP&E> 3,558,134
<DEPRECIATION> 3,333,921
<TOTAL-ASSETS> 748,136
<CURRENT-LIABILITIES> 78,584
<BONDS> 15,150
0
0
<COMMON> 770,433
<OTHER-SE> (116,031)
<TOTAL-LIABILITY-AND-EQUITY> 748,136
<SALES> 108,850
<TOTAL-REVENUES> 126,284
<CGS> 0
<TOTAL-COSTS> 85,283
<OTHER-EXPENSES> 95,299
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (54,298)
<INCOME-TAX> (903)
<INCOME-CONTINUING> (55,201)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (55,201)
<EPS-PRIMARY> (.020)
<EPS-DILUTED> (.020)
</TABLE>
<PAGE>
EXHIBIT 99
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 8-K
CURRENT REPORT
___________________
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
___________________
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JANUARY 23, 1996
___________________
AMACAN RESOURCES CORPORATION
----------------------------
(Exact name of registrant as specified in its charter)
UTAH 0-6425 87-0284979
- ---------------------------- --------------------- -------------------
(State or other jurisdiction (Commission File No.) (IRS Employer
of incorporation) Identification No.)
1399 SOUTH SEVENTH EAST, NO. 9
Salt Lake City, Utah 84105
------------------------------------------------------------
(Address of principal executive offices, including zip code)
(801) 486-9911
------------------------------------------------------------
(Registrant's telephone number, including area code)
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<PAGE>
ITEM 5. EXECUTION OF EXCHANGE AGREEMENT.
On January 23, 1996 the Company entered into an Agreement and Plan of
Reorganization (the "Agreement") among the Company, Spire Technologies, Inc.,
a Utah corporation ("Spire"), Spire Technologies Systems Division, Inc.
("Spire Systems" and, collectively with Spire, the "Spire Companies") and the
holders of all the capital stock of the Spire Companies (the "Spire
Stockholders"). The transactions contemplated by the Agreement are referred
to collectively herein as the "Share Exchange."
Pursuant to the Agreement, (a) the Company will acquire all of the
issued and outstanding shares of the capital stock of Spire and Spire Systems
in exchange for the issuance by the Company of an aggregate of 3,501,883
shares of the Company's Common Stock, par value $.25 per share (the "Amacan
Common Stock"), to the Spire Stockholders; (b) the Company will effect a
one-for-seven reverse split of the shares of Amacan Common Stock issued and
outstanding at the effective time of the Share Exchange (the "Effective
Time"); (c) the Company will amend its Articles of Incorporation to change
the Company's name to "Spire Technologies International Corporation," or such
other name as Amacan and the Spire Companies shall agree; (d) the Company
will adopt the Amacan Resources Corporation Stock Incentive Plan (the "Amacan
Option Plan"); (e) the Company will assume the outstanding stock options to
purchase shares of the common stock, par value $.01 per share, of Spire
issued pursuant to the Spire 1995 Stock Option and Award Plan (the "Spire
Option Plan") and all obligations of Spire under the Spire Option Plan; and
(f) the current officers and directors of the Company will, subsequent to the
Effective Time, resign and the Spire Stockholders will designate individuals
for appointment as replacement officers and directors for appointment
(provided, however, that, as permitted by the Agreement, the Company's Board
of Directors has designated Sherman H. Smith, an advisor to the Company, to
serve as a director of the Company subsequent to the closing of the Share
Exchange). Immediately following the consummation of the Share Exchange, if
consummated, the shares of Amacan Common Stock owned by the current
stockholders of the Company will represent approximately 10% of the then
issued and outstanding shares of Amacan Common Stock. Consummation of the
transactions contemplated by the Agreement is subject to certain conditions,
including without limitation the approval of the shareholders of the Company
in accordance with the Utah Revised Business Corporation Act. Copies of the
Agreement and the press release announcing its execution are attached as
exhibits hereto and incorporated herein by this reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial statements of business acquired.
None
(b) Pro forma financial information.
None
(c) Exhibits.
The following exhibits are included herein:
REG. S-K EXHIBIT
EXHIBIT NO. DESCRIPTION NO.
- ----------- ----------------------------------------------- -------
2.1 Agreement and Plan of Reorganization 1
99 Press Release dated January 24, 1996 2
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMACAN RESOURCES CORPORATION
/s/ Tad M. Ballantyne
-----------------------------
Tad M. Ballantyne
President
Date: January 30, 1996.
