<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20459
FORM 10-QSB/A
QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended: September 30, 2000
Commission File Number: 0-11419
Armitec, Inc.
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(Exact Name of Registrant as specified in its Charter)
Delaware 22-2435595
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(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
Post Office Box 21238, St. Simons Island, Georgia 31522-0738
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Address of Principal executive offices of Zip Code
Incorporation or organization
912-634-2584
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Registrants telephone number, including area code
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 and 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 last 90 days.
YES [X] NO [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as to the latest practical date.
CLASS No. of shares Outstanding on
September 30, 2000
Common Stock 3,051,857
Par Value $.00167
Per share
Explanatory Note.
On November 27, 2000, Armitec, Inc. filed an amendment on Form 10-KSB/A to its
Annual Report for the period ended December 31, 1999, and entered and filed
under the Small Business Disclosure System. This Report on Form 10-QSB/A amends
the disclosure contained in the Quarterly Report on Form 10-Q for the quarter
ended September 30, 2000, filed by Armitec, Inc. with the United States
Securities and Exchange Commission on November 20, 2000.
<PAGE> 2
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
ARMITEC, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
2000 1999
------------- ------------
(Unaudited) (Audited)
<S> <C> <C>
ASSETS
CURRENT:
Cash $ 0 $ 41,758
Marketable securities 0 99,074
----------- -----------
TOTAL CURRENT ASSETS 0 140,832
Other receivables 0 60,512
Investment in closely-held company 0 24,375
----------- -----------
$ 0 $ 225,719
=========== ===========
LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
CURRENT LIABILITIES:
Cash overdraft - Investment margin account $ 0 $ 23,333
Accounts payable 0 13,900
Advance payable - E. Carman 0 25,000
----------- -----------
TOTAL CURRENT LIABILITIES 0 62,233
----------- -----------
STOCKHOLDERS' EQUITY:
Common Stock 5,051 3,351
Paid in capital 2,702,005 2,673,705
Retained earnings (deficit) (2,707,056) (2,513,570)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 0 163,486
----------- -----------
$ 0 $ 225,719
=========== ===========
</TABLE>
See accompanying notes.
<PAGE> 3
ARMITEC, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, MAY 31, SEPTEMBER 30, MAY 31,
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES $ -- $ -- $ -- $ --
----------- ----------- ----------- -----------
EXPENSES:
Salaries and compensation -- -- 10,000 --
Professional fees 13,360 -- 25,246 1,000
Other administrative 466 1,234 8,618 10,968
----------- ----------- ----------- -----------
13,826 1,234 43,864 11,968
----------- ----------- ----------- -----------
OPERATING INCOME (LOSS) (13,826) (1,234) (43,864) (11,968)
OTHER INCOME (EXPENSE)
Gains (losses) on sales
of securities 10,201 -- (62,704) 17,221
Interest and dividends -- -- 133 --
Miscellaneous income -- -- 1,603 --
Interest expense (61) -- (726) --
Consulting fee to Colonial
Corporation (87,928) -- (87,928) --
----------- ----------- ----------- -----------
NET INCOME (LOSS) $ (91,614) $ (1,234) $ (193,486) $ 5,253
=========== =========== =========== ===========
AVERAGE NUMBER OF SHARES-BASIC 3,029,175 2,006,757 2,467,518 2,006,757
AVERAGE NUMBER OF SHARES-DILUTED 3,029,175 2,006,757 2,467,518 2,006,757
EARNINGS (LOSS) PER SHARE
BASIC $ (0.0302) $ (0.0006) $ (0.0784) $ 0.0026
DILUTED $ (0.0302) $ (0.0006) $ (0.0784) $ 0.0026
</TABLE>
See accompanying notes.
<PAGE> 4
ARMITEC, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30, May 31,
2000 1999
------------ ------------
<S> <C> <C>
CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES:
Net loss $(193,486) $ 5,253
Adjustments to reconcile net income (loss) to cash
(used in) operating activities:
(Gain) loss on sale of investments 83,106 (17,222)
Cash provided by (used for):
Compensation stock issued 10,000 --
Transfer of net assets to Colonial Corporation 87,928 --
(Increase) decrease in trade receivables -- (125)
(Increase) decrease in other receivables (6,000) (56,075)
(Increase) decrease in note receivable -- 9,155
Increase (decrease) in accounts payable (13,900) --
--------- ---------
Cash (used in) operating activities (32,352) (59,014)
CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES:
Proceeds from sale of investments 326,919 695,101
Purchase of investments (316,863) (744,233)
Transfer to operating cash 8,871 100,750
Transfer from operating cash -- (36,552)
--------- ---------
Cash provided by investing activities 18,927 15,066
--------- ---------
CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES:
Advance received from an individual 68,000 --
Repayment of advance received from individual (68,000) --
Principal payment on notes payable (5,000) --
--------- ---------
Cash (used in) financing activities (5,000) --
--------- ---------
Net increase (decrease) in cash and cash equivalents (18,425) (43,948)
Cash and cash equivalents, beginning of period 18,425 15,656
--------- ---------
Cash and cash equivalents, end of period $ -- $ (28,292)
========= =========
</TABLE>
See accompanying notes.
<PAGE> 5
ARMITEC, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
Nine Months Ended September 30, 2000
1. ORGANIZATION AND BASIS OF PRESENTATION
On August 24, 2000, the majority of the shareholders of Registrant
elected to change the name of Registrant from Family Health Systems,
Inc. to Armitec, Inc. Additionally, on August 24, 2000, the majority of
the shareholders of the Registrant elected to increase the authorized
shares of Common Stock of the Registrant to fifty million (50,000,000).
An amendment to Registrant's Certificate of Incorporation reflecting
the name change and increase in the authorized shares of Capital Stock
was filed with the Secretary of the State of Delaware on August 30,
2000.
On September 8, 2000, Armitec received a new symbol from NASDAQ, which
is AMTI. At this time, Armitec is currently in the process of having
its stock relisted on the OTC Bulletin Board
On September 15, 2000, the Board of Directors and the majority of the
shareholders of Armitec, Inc. (Armitec) approved the terms of the
purchase of Armitec.com, Inc. Those basic terms involve the issuance of
Armitec Common Stock to the shareholders of Armitec.com in exchange for
their shares of Armitec.com., so that after the issuance, the
shareholders of Armitec.com will hold 45.68% of the outstanding shares
of Armitec and the current shareholders of Armitec will retain 10.00%
ownership. Additionally, 39.32% of the outstanding shares of Armitec
will be reserved for use in a Private Offering of such shares in order
to raise capital for Armitec. To the extent that such shares are not
sold in a Private Placement, the Armitec.com shareholders may purchase
such shares for a nominal amount. Additionally, 5.00% of the
outstanding shares of Armitec will be reserved to hire consultants to
assist Armitec after the acquisition.
On September 15, 2000 Armitec executed a definitive Plan and Agreement
to Exchange Stock (Plan) with Armitec.com. The closing date of the
foregoing stock exchange is dependent upon the completion and
satisfaction of required shareholder consents and notifications. As of
November 17, 2000, these items have not been completed.
In contemplation of this Plan, The Board of Directors and a majority of
the shareholders approved a distribution of remaining net assets of the
Company as of August 31, 2000 to Colonial Corporation, a company
controlled by an officer of Armitec. The net assets were $87,928 and
this transaction was recorded in the accompanying statement of
operations as a consulting fee for the quarter ended September 30,
2000. The company does not presently have any operations.
In December 1999, the Board of Directors and a majority of the
shareholders of Armitec, Inc. approved a change in the company's year
end from August 31st to December 31st. The company has elected to
include the comparable interim financial information required by the
Securities and Exchange Commission based on the fiscal quarters from
the year ended August 31, 1999.
The information presented at September 30, 2000, and for the periods
ended September 30, 2000 and May 31, 1999 is unaudited, however, in the
opinion of management, includes all normal recurring adjustments
necessary for a fair presentation of the financial position, results of
operations and cash flows of Armitec for the periods presented.
Historical results may not be indicative of the results to be expected
in the future. Certain information in footnote disclosures normally
included in annual financial statements prepared in accordance with
generally accepted accounting principles have been condensed or omitted
<PAGE> 6
pursuant to the rules and regulations of the Securities and Exchange
Commission. The financial statements, notes thereto and other
information should be read in conjunction with the historical financial
statements and related notes thereto contained in Armitec's Annual
Report on Form 10-K for the four months ended December 31, 1999.
Item 2. Management's Discussion and Analysis of Financial Condition and results
of operation
Results of Operations.
Armitec's operations consisted solely of portfolio management for the
three and nine months ended September 30, 2000 and the three and nine
months ended May 31, 1999. Losses related to Armitec's operations were
$91,614 ($0.0302 per share) and $193,486 ($0.0784 per share),
respectively during the 2000 periods presented compared to loss of
$1,234 ($0.0006 per share) and income of $5,253 ($0.0026 per share) for
the three and nine months ended May 31, 1999, respectively.
Expenses during the three and nine months ended September 30, 2000 were
$13,826 and $43,864, respectively, compared to $1,234 and $11,968 for
the three and nine months ended May 31, 1999, respectively. The
increase in expenses in 2000 are attributable to professional fees of
$25,246 for the nine months ended September 30, 2000 incurred in filing
of certain delinquent Form 10Qs and 10Ks for 1997, 1998, 1999 and 2000.
Professional fees were not significant in the 1999 periods presented.
Other significant expenses recorded in 2000 result from the issuance of
1,000,000 shares of the Company's common stock to certain officers for
services. These shares were valued at $.01 or $10,000. This was a one
time expense not incurred in the other periods presented.
Other income (expense) for the three and nine months ended September
30, 2000 was $(77,788) and $(149,622), respectively. During the nine
months ended May 31, 1999 other income (expense) was $17,221. There
were no other income (expense) items during the three months ended May
31, 1999. During the 2000 periods presented, the company transferred
the remaining net assets of $87,298 of the Company to Colonial
Corporation as a consulting fee. During the three and nine months ended
September 30, 2000 the result of trading activities for the portfolio
was a gain of $10,201, and a loss of $62,704, respectively. During the
nine months ended May 31, 1999, the result of trading activities for
the portfolio was a gain of $17,221. There was no trading activity
during the three months ended May 31, 1999. On September 15, 2000, the
Board of Directors and the majority of the shareholders of Armitec,
Inc. (Armitec) approved the terms of the purchase of Armitec.com, Inc.
Those basic terms involve the issuance of Armitec Common Stock to the
shareholders of Armitec.com in exchange for their shares of
Armitec.com., so that after the issuance, the shareholders of
Armitec.com will hold 45.68% of the outstanding shares of Armitec and
the current shareholders of Armitec will retain 10.00% ownership.
Additionally, 39.32% of the outstanding shares of Armitec will be
reserved for use in a Private Offering of such shares in order to raise
capital for Armitec. To the extent that such shares are not sold in a
Private Placement, the Armitec.com shareholders may purchase such
shares for a nominal amount. Additionally, 5.00% of the outstanding
shares of Armitec will be reserved to hire consultants to assist
Armitec after the acquisition.
On September 15, 2000 Armitec executed a definitive Plan and Agreement
to Exchange Stock (the "Stock Exchange") with Armitec.com. The closing
date of the Stock Exchange is dependent upon the completion and
satisfaction of required shareholder consents and notifications. As of
November 17, 2000, these items have not been completed.
The Stock Exchange is expected to close prior to Armitec's fiscal year
end of December 31, 2000. In the event the Stock Exchange is not
consummated, management will review and revise its plan of operations
accordingly.
<PAGE> 7
Liquidity and Capital Resources.
In contemplation of the Stock Exchange, The Board of Directors and a
majority of the shareholders approved a distribution of remaining net
assets of the Company as of August 31, 2000 to Colonial Corporation, a
company controlled by an officer of Armitec. The net assets were
$87,928 and this transaction was recorded in the accompanying statement
of operations as a consulting fee for the quarter ended September 30,
2000. The company does not presently have any operations.
In connection with the Stock Exchange, Armitec intends to raise
additional capital through a Private Placement of common stock of
Armitec. Armitec will need to raise additional funds in order to
proceed with the revised plan of operations after the expected
consummation of the Stock Exchange. There is no assurance that such
additional financing will be available when required in order to
proceed with the business plan or that the Company's ability to respond
to competition or changes in the market place or to exploit
opportunities will not be limited by lack of available capital.
Part II
Item 1. Legal Proceedings
NONE
Item 2. Changes in Securities and Use of Proceeds
NONE
Item 3. Defaults Upon Senior Securities
NONE
Item 4. Submission of Matters to a Vote of Security Holders
NONE
Item 5. Other Information
NONE
Item 6. Exhibits and Reports on Form 8-K:
Exhibit 27 - Financial Data Schedule (for SEC use only)
Armitec filed a current report on Form 8-K, as amended, on
November 20, 2000, with the Securities and Exchange Commission on September 22,
2000 for the purposes of reporting a change in the name of the Registrant, an
increase in authorized shares of the Company's common stock and the signing of
an agreement to acquire the stock of Armitec.com, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereto duly authorized.
ARMITEC, INC.
December 4, 2000 /s/ William S. Bryant
----------------------------------------
William S. Bryant, President
Chief Financial Officer
