<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED
July 31, 1990 COMMISSION NO. 0-6649
JILCO INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(exact name of registrant as specified in its charter)
California 95-207885
- ---------------------------- ---------------------
(State or other jurisdiction I.R.S. Employer
of organization) Identification No.
P. O. Box 10539
Beverly Hills, California 90213
- ------------------------- ---------------------
(Address or principal (Zip Code)
executive offices)
Registrant's telephone number, including area code is (310) 274-1986. Securities
registered pursuant to Section 12(g) of the Act:
Common Stock, No Par Value
- --------------------------------------------------------------------------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 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 No X
----- -----
As of July 31, 1990, there were 449,991 shares of common stock outstanding.
<PAGE> 2
ITEM 1. Business
Registrant is not engaged in any business operations and has not been
so engaged since 1968.
ITEM 2. Properties
Registrant does not have an interest in any properties.
ITEM 3. Legal Proceedings
None.
PART II.
ITEM 5. Market for the Registrant's Common Stock and Related Security Holder
Matters
Increase and Decrease in Outstanding Securities Indebtedness
None.
Changes in Securities and Changes in Securities for Registered
Securities
None.
Defaults Upon Senior Securities
None.
Approximate Number of Equity Security Holders
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<TABLE>
<CAPTION>
Number of Record Holders
Title of Class As of July 31, 1990
-------------- ---------------------
<S> <C>
Common Stock 785
</TABLE>
Submission of Matters to a Vote of Security Holders
Not applicable.
ITEM 6. Selected Financial Data
Five Year Summary of Operations
<TABLE>
<CAPTION>
Year ended July 31,
-----------------------------------------------------------------
1990 1989 1988 1987 1986
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Expenses $ 7,141 $ 6,577 $ 5,722 $ 3,300 $ 3,171
Net loss $(7,141) $(6,577) $(5,722) $(3,300) $(3,171)
Loss per share $ (0.02) $ (0.01) $ (0.01) $ (0.01) $ (0.01)
(Note 2)
Total Assets $ 370 $ 2,280 $ 1,882 $ 965 $ 835
</TABLE>
The numerical note referred to above is included in the Notes to Financial
Statements. Registrant has not conducted any business operations during its last
five (5) fiscal years, except that during the above fiscal years it has incurred
expenses necessary to keep its good standing in its state of residence.
ITEM 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Refer to notes and financial statements.
ITEM 8. Financial Statements and Supplementary Data
The financial statements of Registrant are attached hereto as Exhibit
14(a).
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<PAGE> 4
PART III.
ITEM 10. Directors and Executive Officers of the Registrant
<TABLE>
<CAPTION>
First Common Shares
Principal Elected Owned Beneficially
Name Occupation Age Director On July 31, 1990
---- ---------- --- -------- -----------------
<S> <C> <C> <C> <C>
Byron J. Wayne President, 57 1987 -0-
Secretary and
Treasurer of
Registrant
</TABLE>
ITEM 11. Management Remuneration and Transaction
No officer or director of Registrant receives any remuneration.
ITEM 12. Security Ownership of Certain Beneficial Owners and Management
Leonard M. Ross owns 400,955 shares of the issued and outstanding stock
of Registrant which constitutes approximately 89% of such stock.
Registrant does not have any subsidiaries.
Indemnification of Directors and Officers
The by-laws of the Corporation provide that the Corporation shall
indemnify each of its officers and directors, whether or not then in office, to
the extent permitted by the California General Corporation Law against all
reasonable expenses actually and necessarily incurred by such individuals in
connection with the defense of any litigation to which he or she may have been
made a party because he or she is or was a director or officer of the
Corporation. Directors and officers have no right to reimbursement in relation
to any matter in which such officer or director has been adjudged liable to the
Corporation for gross negligence or comparable misconduct in the performance of
his or her duties.
PART IV
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ITEM 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K (a)
The Registrant's financial statements are attached hereto.
(b) No materially important events occurred during the fiscal year
of Registrant that would require filing of Form 8-K.
(c) The Exhibits listed in the accompanying Exhibit Index on Page
12 are filed as part of this Form 10-K.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned thereunto duty authorized.
(Registrant) JILCO INDUSTRIES, INC.
By: /s/ Martha J. Kretzmer
-----------------------------
Martha J. Kretzmer
President
Date: August 7, 1997
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JILCO INDUSTRIES, INC.
List of Financial Statements
The following financial statements of Jilco Industries, Inc.
are included in Item 8:
Balance sheets -- Years ended July 31, 1990 and 1989.
Statements of operations -- Years ended July 31, 1990, 1989
and 1988.
Statements of cash flows -- Years ended July 31, 1990, 1989
and 1988.
Notes to financial statements -- July 31, 1990.
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<PAGE> 7
JILCO INDUSTRIES, INC.
BALANCE SHEETS
AS OF JULY 31,
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
1990 1989
--------- ---------
ASSETS
<S> <C> <C>
Cash $ 370 $ 2,280
--------- ---------
TOTAL ASSETS $ 370 $ 2,280
========= =========
LIABILITIES AND SHAREHOLDERS' DEFICIENCY
CURRENT LIABILITIES
Accounts payable $ -0- $ -0-
Notes payable to shareholder
(Note 3) 46,000 45,000
Accrued expenses (Note 3) 17,276 13,045
--------- ---------
Total current liabilities 63,276 58,045
--------- ---------
SHAREHOLDERS' DEFICIENCY
Common stock, no par value
1,500,000 shares authorized
449,991 shares issued and
outstanding 749,950 749,950
Accumulated deficit (812,856) (805,715)
--------- ---------
Total shareholders'
deficiency (62,906) (55,765)
--------- ---------
TOTAL LIABILITIES AND
SHAREHOLDERS'
DEFICIENCY $ 370 $ 2,280
========= =========
</TABLE>
The accompanying notes are an integral part of
these financial statements.
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<PAGE> 8
JILCO INDUSTRIES, INC.
STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE YEARS ENDED JULY 31,
(UNAUDITED)
<TABLE>
<CAPTION>
1990 1989 1988
--------- --------- ---------
<S> <C> <C> <C>
EXPENSES
Professional
fees $ 2,000 $ 1,795 $ 1,783
Fees and
licenses 255 255 1,155
Interest expense
(Note 3) 4,231 4,085 2,519
State franchise
tax 600 405 200
Sundry 55 37 65
Total
expenses 7,141 6,577 5,722
--------- --------- ---------
NET LOSS (7,141) (6,577) (5,722)
ACCUMULATED DEFICIT,
BEGINNING OF
YEAR (805,715) (799,138) (793,416)
--------- --------- ---------
ACCUMULATED DEFICIT,
END OF YEAR $(812,856) $(805,715) $(799,138)
========= ========= =========
NET LOSS PER SHARE
(NOTE 2) $ (0.02) $ (0.01) $ (0.01)
========= ========= =========
</TABLE>
The accompanying notes are an integral part of
these financial statements.
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<PAGE> 9
JILCO INDUSTRIES, INC.
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED JULY 31,
<TABLE>
<CAPTION>
1990 1989 1988
------- ------- -------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(7,141) $(6,577) $(5,722)
Increase
(decrease) in
Accounts payable
and accrued
expenses 4,231 3,900 2,639
------- ------- -------
Net cash used
in operating
activities (2,910) (2,677) (3,083)
------- ------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from
notes payable to
shareholder, net 1,000 3,075 4,000
------- ------- -------
Net cash
provided by
financing
activities 1,000 3,075 4,000
------- ------- -------
NET INCREASE
(DECREASE) IN
CASH (1,910) 398 917
CASH, BEGINNING
OF YEAR 2,280 1,882 965
------- ------- -------
CASH, END OF YEAR $ 370 $ 2,280 $ 1,882
======= ======= =======
</TABLE>
The accompanying notes are an integral part of
these financial statements.
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<PAGE> 10
NOTE 1 - THE COMPANY
The Company has been inactive since April 2, 1968 when it was discharged from
bankruptcy under its previous name of Sportways, Inc. The expenses the Company
has incurred represent those necessary to keep the Company in good standing in
its state of residence.
Fair Value of Financial Instruments
The Company measures its financial assets and liabilities in accordance with
generally accepted accounting principles. For certain of the Company's financial
instruments, including cash, accounts payable, and accrued expenses, the
carrying amounts approximate fair value due to their short maturities. The
amounts shown as notes payable also approximate fair value because current
interest rates offered to the Company for notes payable of similar maturities
are substantially the same.
Estimates
In preparing financial statements in conformity with generally accepted
accounting principles, management makes estimates and assumptions that affect
the reported amounts of assets and liabilities at the date of the financial
statements, as well as the reported amounts of expenses during the reporting
period. Actual results could differ from those estimates.
NOTE 2 - LOSS PER SHARE
All per share computations are based on 449,991 shares outstanding. There are no
common stock equivalents.
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<PAGE> 11
NOTE 3 - NOTES PAYABLE TO SHAREHOLDER
Notes payable to shareholder consist of the following:
<TABLE>
<CAPTION>
1996 1995 1994 1993 1992 1991 1990 1989
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revolving note
payable (A) $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000
Revolving note
payable (B) 8,250 8,250 8,250 5,250 4,250 2,000 1,000 -0-
Term note
payable (C) 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
------- ------- ------- ------- ------- ------- ------- -------
TOTAL $53,250 $53,250 $53,250 $50,250 $49,250 $47,000 $46,000 $45,000
------- ------- ------- ------- ------- ------- ------- -------
</TABLE>
(A) Accrued interest at 9% per annum. Principal and accrued interest due on
demand.
(B) Accrued interest at 11% per annum. Principal and accrued interest due
on demand.
(C) Accrued interest at 10% per annum. Principal and accrued interest due
on demand.
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<PAGE> 12
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
3(1) Articles of Incorporation of the Registrant, as amended
(incorporated by reference to Exhibit 3(1) to the Company's
1989 Form 10-K).
3(2) By-laws of the Registrant, as amended (incorporated by reference to Exhibit 3(2) to the
Company's 1989 Form 10-K).
10(1) Revolving Demand Note, dated November 7, 1989, between the Company and Leonard M.
Ross).
10(2) Note Extension and Modification Agreement, dated November 7, 1989, between the
Company and Leonard M. Ross.
10(3) Revolving Demand Note, dated December 18, 1987, between the
Company and Leonard M. Ross (incorporated by reference to
Exhibit 10(1) to the Company's 1989 Form 10-K).
10(4) Note Extension and Modification Agreement, dated November 7, 1989, between the
Company and Leonard M. Ross.
10(5) Note Extension and Modification Agreement, dated July 13, 1988, between the Company and
Leonard M. Ross (incorporated by reference to Exhibit 10(2) to the Company's 1989 Form
10-K).
10(6) Promissory Note Extension Agreement, dated August 8, 1986, between the Company and
Leonard M. Ross (incorporated by reference to Exhibit 10(3) to the Company's 1989 Form
10-K).
</TABLE>
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<PAGE> 1
EXHIBIT 10(1)
REVOLVING DEMAND NOTE
("NOTE")
November 7, 1989
$10,000.00 Beverly Hills, California
On demand, or if no demand is made then on December 31, 1991 ("Maturity
Date" herein), for value received, the undersigned ("Maker" or "Payor" herein)
promise(s) to pay to the order of LEONARD M. ROSS ("Holder" or "Payee" herein),
at Beverly Hills, California, or at such other address as is designated by
Holder, the sum of TEN THOUSAND DOLLARS ($10,000.00), or so much thereof as may
be outstanding hereunder, together with interest thereon from and after the date
hereof on the unpaid principal at the rate of ELEVEN PERCENT (11%) per year
(computed on the basis of a 360-day year for the actual number of days elapsed
from the date set forth until paid). Interest shall be payable on or before the
Maturity Date. Principal and interest shall be payable only in lawful money of
the United States of America.
All or any portion of the principal of this Note may be borrowed,
repaid and reborrowed from time to time prior to the Maturity Date, provided
that at the time of any borrowing no default exists, and provided further that
the total borrowings outstanding hereunder at any one time shall not exceed
$10,000. Each borrowing and repayment hereunder will be endorsed on the reverse
of this Note. The excess of borrowings over repayments shall evidence the
principal balance due hereon from time to time and at any time. Any loan
hereunder shall be conclusively presumed to have been made to or for the benefit
of the undersigned when made in accordance with such request.
Each of the following events shall constitute an "Event of Default"
(collectively "Events of Default") under this Note:
(1) The failure of the undersigned to pay any installment
of principal or interest on this Note when the same becomes due and payable.
(2) The undersigned shall make an assignment for the
benefit of creditors.
(3) The undersigned shall petition or apply to any
tribunal for appointment of a trustee or receiver of the undersigned or commence
any proceeding relating to the
1
<PAGE> 2
undersigned under any bankruptcy or reorganization statute or any provision of
the Bankruptcy Act, or under any arrangement, insolvency, readjustment or debt,
dissolution or liquidation law of any jurisdiction, whether now or hereafter in
effect.
(4) Any petition or application of the type described above is
filed or any proceedings of the type described in subparagraph (3), above, are
commenced against the undersigned, and the undersigned by any act indicates it
approval thereof, consent thereto or acquiescence therein, or an order is
entered appointing any such trustee or receiver, or adjudicating the undersigned
bankrupt or insolvent, or approving the petition in any such proceeding, and any
such order remains in effect for more than sixty (60) days.
Should any Event of Default occur, the Payee of this Note may, if such
Event of Default is not cured within five (5) days after receipt by Payor of
written notice from Payee of such Event of Default (which receipt shall be
deemed to have occurred THREE (3) DAYS after deposit of said written notice in
the United States mail, certified, return receipt requested, postage and fees
prepaid, addressed to Payor at the address set forth below), declare the whole
sum of principal and interest to be, and thereafter the whole sum of principal
and interest shall forthwith become, due and payable. Should principal and
interest not be paid on the agreed or accelerated date of maturity, then the
interest rate provided for under this Note shall, without notice, be increased
to an amount TWO PERCENT (2%) per year over and above the rate originally
contracted for, effective from the day following the date that such payment of
principal or interest became overdue, with such unpaid interest compounded; but
in no event shall the interest payable hereunder exceed the maximum rate
permitted by law. Such increased rate of interest shall continue until such
overdue payment of principal and interest shall be paid in full. The failure to
exercise, in case of one or more Events of Default, any right or remedy given in
this paragraph shall not preclude the Payee of this Note from exercising any
right or remedy given in this paragraph in case of one or more subsequent Events
of Default.
All of any portion of principal and interest, or both, of this Note may
be prepaid, in whole or in part, at any time or from time to time, without
penalty or premium.
In the event this Note is not paid on the agreed or accelerated date of
maturity according to its terms, Maker promise(s) to pay all costs of collection
of this Note and reasonable attorneys' fees in connection therewith, whether or
not suit is filed hereon. The makers and endorsers of this Note hereby waive
diligence, demand, presentment, protest and notice of any kind. If this Note is
executed by two or more makers, the obligations and liability of the undersigned
shall be joint and several.
2
<PAGE> 3
This Note shall be binding upon Maker and the heirs, successors and
assigns of Maker, and shall inure to the benefit of Holder, its heirs,
successors and assigns.
Address: JILCO INDUSTRIES, INC.
P. 0. Box 10539
Beverly Hills, CA 90213
By /s/ Byron Wayne
--------------------------------
Byron Wayne, President
"Payor/Maker"
[Revolving Demand Note to LEONARD M. ROSS dated November 7, 1989 in the original
principal amount of $10,000.00]
3
<PAGE> 1
EXHIBIT 10(2)
NOTE EXTENSION AND MODIFICATION AGREEMENT
THIS NOTE EXTENSION AND MODIFICATION AGREEMENT ("Agreement") is entered
into by and between JILCO INDUSTRIES, INC., a California corporation ("Payor")
and LEONARD M. ROSS, a California resident ("Payee").
Payor and Payee do hereby mutually acknowledge and agree that Payor is
presently liable for the indebtedness represented by a certain promissory note
payable to Payee in the original principal amount of FORTY THOUSAND DOLLARS
($40,000.00) ("Note" herein), which has a present outstanding balance as of the
date hereof of FORTY THOUSAND DOLLARS ($40,000.00) plus accrued interest.
NOW, THEREFORE, FOR VALUABLE CONSIDERATION IN HAND
RECEIVED, the parties hereto, and each of them, do hereby agree that effective
as of the date hereof, the unpaid principal portion of the Note and all unpaid
accrued interest, if any, shall be all due and payable on December 31, 1991.
Nothing contained herein shall be deemed to affect the obligation of
Payor regarding the payment of interest accrued on the Note through the date
hereof, or to affect any obligations of Payor under the Note, except as set
forth herein.
IN WITNESS WHEREOF, the parties hereto, and each of them, have executed
this Agreement as of the 7th day of November, 1989.
JILCO INDUSTRIES, INC.
a California corporation
By /s/ Byron Wayne
-------------------------------------
Byron Wayne, President
"Payor"
/s/ Leonard M. Ross
-------------------------------------
Leonard M. Ross
"Payee"
<PAGE> 1
EXHIBIT 10(4)
NOTE EXTENSION AND MODIFICATION AGREEMENT
THIS NOTE EXTENSION AND MODIFICATION AGREEMENT ("Agreement") is entered
into by and between JILCO INDUSTRIES, INC., a California corporation ("Payor")
and LEONARD N. ROSS, a California resident ("Payee").
Payor and Payee do hereby mutually acknowledge and agree that Payor is
presently liable for the indebtedness represented by a certain promissory note
payable to Payee in the original principal amount of FIVE THOUSAND DOLLARS
($5,000.00) ("Note" herein), which has a present outstanding balance as of the
date hereof of FIVE THOUSAND DOLLARS ($5,000.00) plus accrued interest.
NOW, THEREFORE, FOR VALUABLE CONSIDERATION IN HAND
RECEIVED, the parties hereto, and each of them, do hereby agree that effective
as of the date hereof, the unpaid principal portion of the Note and all unpaid
accrued interest, if any, shall be all due and payable on December 31, 1991.
Nothing contained herein shall be deemed to affect the obligation of
Payor regarding the payment of interest accrued on the Note through the date
hereof, or to affect any obligations of Payor under the Note, except as set
forth herein.
IN WITNESS WHEREOF, the parties hereto, and each of them, have executed
this Agreement as of the 7th day of November, 1989.
JILCO INDUSTRIES, INC.
a California corporation
By /s/ Byron Wayne
-----------------------------------
Byron Wayne, President
"Payor"
/s/ Leonard M. Ross
-----------------------------------
Leonard M. Ross
"Payee"
