EUROTRONICS HOLDINGS INCORPORATED
470 East 3900 South, Suite 205
Salt Lake City, Utah 84107
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of Eurotronics Holdings Incorporated:
You are cordially invited to attend the annual meeting of the
shareholders (the "Annual Meeting") of Eurotronics Holdings Incorporated (the
"Company") to be held at the offices of the Company, 470 East 3900 South, Suite
205, Salt Lake City, Utah 84107 on ___________. The purpose of the Annual
Meeting is to consider and vote on the following proposals, all as more fully
described in the accompanying Information Statement:
A. To approve an Amended Agreement for the Exchange of Stock
executed by and between the Company, InterConnect West, Inc.,
a Utah corporation ("InterConnect"), InterConnect's sole
shareholder, the Company's former president and Canton
Financial Services Corporation.
B. To authorize the Company to amend its Articles of
Incorporation by changing the Company's name to "Access Market
Square, Inc."
C. To approve a 1-for-2 reverse stock split of the Company's
issued and outstanding common stock.
D. To reelect Mark Tolman, Nick Nickerson and Fred Muehlmann as
members of the Company's board of directors.
The board of directors has fixed the close of business on ____________
as the record date for determining the shareholders entitled to notice of and to
vote at the Annual Meeting and any adjournment thereof. A list of such
shareholders will be available for inspection at the time and place of the
meeting.
By Order of the Board of Directors
/s/ Mark Tolman
---------------------
Mark Tolman
President
April 7, 1997
<PAGE>
EUROTRONICS HOLDINGS INCORPORATED
470 East 3900 South, Suite 205
Salt Lake City, Utah 84107
PRELIMINARY INFORMATION STATEMENT
I. VOTING SECURITIES, VOTING RIGHTS AND RECORD DATE
This Information Statement is being furnished on behalf of the board of
directors of Eurotronics Holdings Incorporated, a Utah corporation with
principal offices at 470 East 3900 South, Suite 205, Salt Lake City, Utah 84107
(the "Company"). The Company's telephone number is 801-281-0888. This
Information Statement is being provided in connection with the annual meeting of
shareholders to be held at the Company's principal offices on ________ at 10:00
A.M. Mountain Standard Time (the "Annual Meeting").
At the Annual Meeting, the shareholders will consider and vote upon the
following corporate proposals:
A. The approval and adoption of the Amended Agreement for the
Exchange of Stock executed by and among the Company,
InterConnect West, Inc., a Utah corporation ("InterConnect"),
InterConnect's sole shareholder, the Company's former
president and Canton Financial Services Corporation whereby
the Company will acquire InterConnect as a wholly-owned
subsidiary in exchange for the Company's issuance of Common
Stock and other consideration described below.
B. The proposed amendment of the Company's Articles of
Incorporation changing the Company's name to "Access Market
Square, Inc."
C. The proposed 1-for-2 reverse stock split of the Company's
issued and outstanding Common Stock.
D. The reelection of Mark Tolman, Nick Nickerson and Fred
Muehlmann as members of the Company's board of directors.
For more information on each of the actions approved by the shareholders, see
"Matters to be Considered at the Annual Meeting" below.
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
The Company is sending this Information Statement to all shareholders
of record as of ___________ ("Record Shareholders") and will begin mailing these
materials on _________. There are currently 4,520,336 shares of the Company's
common stock, par value $0.0001 ("Common Stock"). The Common Stock represents
the only securities of the Company with voting rights. Each share of Common
Stock is entitled to one vote at the Annual Meeting. Shareholders are not
entitled to any cumulative voting rights with respect to the election of
directors. No state law appraisal or other dissenter rights arise from these
corporate actions.
II. MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING
A. Acquisition of InterConnect West
On July 16, 1996, the Company executed an Agreement for the Exchange of
Stock with InterConnect and InterConnect's sole shareholder, Mark Tolman. The
Agreement was made effective July 30, 1996. On February 11, 1997, the Company
executed an Amended Agreement for the Exchange of Stock which superseded the
July 16, 1996 agreement between the parties (the Amended Agreement for the
Exchange of Stock shall hereinafter be referred to as the "Agreement"). Pursuant
to the Agreement and subject to shareholder approval, the Company will acquire
100% of InterConnect's outstanding capital stock, making InterConnect its
wholly-owned subsidiary. The acquisition was structured as a tax-free exchange
of stock under the Internal Revenue Code of 1986, as amended.
<PAGE>
InterConnect is the developer of Access Market Square, an electronic
shopping mall on the World Wide Web. InterConnect designs web pages, known as
storefronts, for businesses interested in advertising and marketing their
products and services via the Internet. Through Access Market Square, Internet
users can browse through a business entity's catalog and place orders
electronically. Hundreds of businesses currently have storefronts on Access
Market Square and those storefronts are visited over 60,000 times daily. The
median cost for a storefront on Access Market Square is approximately $2,500 per
year. InterConnect's principal offices are located at 470 East 3900 South, Suite
205, Salt Lake City, Utah 84107. InterConnect's telephone number is
801-281-0888.
In exchange for the acquisition of InterConnect, the Company agreed to
issue shares of Common Stock to James Tilton, Canton Financial Services
Corporation, a Nevada corporation ("CFSC"), and Mark Tolman. Mr. Tilton, the
Company's former president and director, will receive 15,000 shares of Common
Stock. The shares to be issued to Mr. Tilton under the Agreement are
consideration for services rendered by Mr. Tilton in the negotiation of the
Agreement. The resale of these shares is restricted pursuant to Rule 144 ("Rule
144") under the Securities Act of 1933 (the "Act").
CFSC, who served as a financial consultant to the Company from April
1995 to March 1997, will be issued shares of Common Stock as a finder's fee for
introducing the Company to InterConnect and for financial services CFSC rendered
to the Company in connection with the Agreement. CFSC will receive 316,620
shares of Common Stock. The Company is obligated to register all shares to be
issued to CFSC pursuant to an appropriate registration statement under the Act.
The 316,620 shares of Common Stock are to be issued as follows: (1) 79,155
shares shall be issued as soon after the execution of the Agreement as is
practicable; (2) 79,155 shares shall be issued within 90 days of the execution
of the Agreement; (3) 79,155 shares shall be issued within 180 days of the
execution of the Agreement; and (4) 79,155 shares shall be issued within 270
days of the execution of the Agreement. CFSC shall also receive a $100,000 cash
payment within 90 days of the execution of the Agreement.
Finally, the Company will issue to Mark Tolman 2.3 million shares of
Common Stock, all of which shall be restricted pursuant to Rule 144. Mr. Tolman,
the sole shareholder of InterConnect, shall receive these shares as
consideration for his transfer of 100% of InterConnect's capital stock to the
Company. After the Agreement is effective, Mr. Tolman will own a controlling
interest in the Company's outstanding stock. Mr. Tolman was appointed as the
Company's president and director in connection with the Company's pending
acquisition of InterConnect.
On July 16, 1996, the day the Company executed the predecessor to the
Agreement, it also released a public announcement of the Agreement's
consummation and its key terms. The high and low sale prices of the Company's
Common Stock on the day preceding this announcement, as quoted on the
Over-the-Counter Bulletin Board under the symbol "EUHI," were $0.63 and $0.13
respectively. On February 10, 1997, the day preceding the execution of the
Amended Agreement, the high and low sale prices of the Company's Common Stock
were $0.81 and $0.66 respectively.
There are 4,520,336 shares of Common Stock currently issued and
outstanding. This number of shares will be reduced by approximately one-half as
a result of the reverse stock split described below. The Company will issue an
additional 2,626,620 shares under the Agreement, which shares will not be
affected by the reverse split. Accordingly, the ownership interest of the
Company's current shareholders will be reduced to approximately 46% of the total
Common Stock issued and outstanding after the Agreement.
There are no state regulatory requirements that must be complied with
prior to the transaction becoming effective. Accordingly, the acquisition of
InterConnect will be effective once approved by a majority of the Company's
shareholders.
<PAGE>
B. Amendment to Company's Articles of Incorporation Effecting Name Change
The Company does not have any current operations of its own. However,
through InterConnect and subject to shareholder approval, the Company will focus
its operations on Internet-related marketing services. For more information on
these operations see "Management's Plan of Operation" in the accompanying Annual
Report to Shareholders. The Company's board of directors has recommended that
the Company change its name from Eurotronics Holdings Incorporated to Access
Market Square, Inc. to reflect the Company's indirect ownership of Access Market
Square, an existing electronic shopping mall (subject to shareholder approval).
The change will allow the Company to capitalize on the name recognition
associated with Access Market Square.
To officially change the name of the Company from Eurotronics Holdings
Incorporated to Access Market Square, Inc., the Company must amend its Articles
of Incorporation. To effect this amendment, the Company must obtain the approval
of shareholders holding a majority of the Company's Common Stock.
C. 1-for-2 Reverse Stock Split
By resolution effective February 11, 1997, the Company's board of
directors recommended that the Company effect a 1-for-2 reverse stock split of
the Company's issued and outstanding Common Stock. The reverse split will
decrease the number of issued and outstanding shares of Common Stock to one-half
(50%) of its level prior to the reverse split. For every two shares of Common
Stock now owned, the Company's shareholders shall receive one share of
post-reverse Common Stock. All fractional shares that result from the reverse
split shall be rounded up to one whole share. The number of shares which the
Company is authorized to issue (200,000,000) shall not change as a result of the
reverse split. Therefore, the number of shares of Common Stock that remain
authorized but unissued after the reverse split shall increase from the number
of shares authorized but unissued prior to the reverse split. No tax
consequences shall result from the reverse split.
The shares to be issued to James Tilton, Canton Financial Services
Corporation and Mark Tolman under the proposed InterConnect West Agreement shall
be issued subsequent to the reverse stock split. Accordingly, the shares that
each is entitled to receive shall not be reduced from the figures which appear
in Subsection A above.
The board of directors recommended the reverse stock split because they
believed that the number of issued and outstanding shares of Common Stock was
disproportionately large compared to the Company's revenue, net income and net
worth. The reverse stock split will increase the authorized number of shares of
Common Stock which the Company has available to issue. Any such future issuances
of stock would dilute the ownership interest of the Company's current
shareholders.
The reverse stock split shall be effective upon receiving the
affirmative vote of shareholders holding a majority of the Company's outstanding
Common Stock.
D. Election of Directors
The Company underwent a change of control as a result of the July 16,
1996 agreement initially executed by the Company, InterConnect, and Mark Tolman.
On July 17, 1996, the Company's board of directors appointed Mark Tolman as a
director of the Company, Pat Gallegos as the Company's vice president and
director, and Michael Brodsky as the Company's secretary-treasurer and director.
James Tilton, who was the Company's only officer and director prior to these
appointments, then resigned from his positions as president and director. Mr.
Tilton resigned for personal reasons without any disagreements with the Company
or its management. Upon the resignation of Mr. Tilton, the remaining directors
appointed Mark Tolman as the Company's president. The appointment of Mr. Tolman
was based on his familiarity with InterConnect's operations and the controlling
interest in the Company he will receive when the agreement with InterConnect
becomes effective. On March 26, 1997, both Pat Gallegos and Michael Brodsky
resigned as officers and directors of the Company. On March 28, 1997, the
Company's board of directors appointed Nick Nickerson as the Company's vice
president and director. On April 4, 1997, the Company's board of directors
appointed Fred Muehlmann as the Company's secretary-treasurer and director.
<PAGE>
One of the proposals to be discussed and voted upon at the Annual
Meeting is the election of the Company's board of directors. Each of the
nominees listed below is currently serving as a director of the Company and each
has indicated his willingness to serve if reelected. Provided a quorum is
present at the Annual Meeting, the affirmative vote of a majority of shares
represented at the Annual Meeting is necessary to elect each director.
Shareholders are not entitled to cumulate their votes for the election of
directors.
Mark Tolman, age 44, was appointed as the Company's president and
director on July 17, 1996. Mr. Tolman founded InterConnect in early 1994, and
currently serves as its president, chief executive officer and chairman of the
board. Prior to his affiliation with InterConnect, Mr. Tolman was the manager of
management information systems for Evans and Sutherland Computer Corporation.
Mr. Tolman spent 14 years with Evans and Sutherland.
As described above, Mr. Tolman will receive 2.3 million shares of the
Company's Common Stock in exchange for his transfer to the Company of all of the
outstanding capital stock of InterConnect West, Inc. The transaction is subject
to shareholder approval. Based upon the $0.53 closing price of the Common Stock
on the date the agreement was executed, the Company has valued the transaction
at $1,219,000. There is, however, no market for restricted shares of the
Company's Common Stock. Accordingly, the value of the Common Stock received by
Mr. Tolman is likely to be significantly less than the dollar figure appearing
above. Mr. Tolman does not currently own any shares of the Company's Common
Stock.
Nick Nickerson, age 44, was appointed as the Company's vice president
and director on March 28, 1997. Mr. Nickerson also serves as the director of
information technology operations for Parametric Technology Corp., a company
that supplies software tools used to automate the mechanical development of a
product its conceptual design through its release into manufacturing. During the
past five years, Mr. Nickerson has also been the director of systems and data
for the Park City Group and division operations manager for Evans and Sutherland
Computer Corporation.
Fred Muehlmann, age 45, was appointed as the Company's
secretary-treasurer and director on April 4, 1997. Mr. Muehlmann is also
employed by PacifiCorp, an energy company consiting of Utah Power, Pacific
Power, Pacific Telecom and smaller gas, coal and financial companies. Mr.
Muehlmann has been employed with PacifiCorp for 17 years in capacities ranging
from senior programmer to senior systems analyst. Mr. Muehlmann has also served
as a consultant to other various companies involved in computer related fields.
Based solely upon a review of Forms 3, 4 and 5 furnished to the
Company, the Company is not aware of any officer, director or beneficial owner
of more than ten percent of the Company's Common Stock who failed to file, on a
timely basis, reports required under Section 16(a) of the Securities Exchange
Act of 1934 except as follows. A-Z Professional Consultants, Inc. failed to file
a Form 3 upon becoming a 10% owner of the Company's Common Stock. BRIA
Communications Corporation failed to file a Form 3 upon becoming a 10% owner of
the Company's Common Stock The board of directors of the Company does not have
any standing audit, nominating, or compensation committees or any other
committees performing similar functions. During the 1996 fiscal year, the
Company did not hold any meetings of its board of directors.
III. COMPENSATION TABLE
The Company has not established any compensation structure for its
executive officers or directors. Nor have any stock options or stock
appreciation rights ("SARs") regarding the Company's Common Stock ever been
granted to or exercised by any executive officer of the Company. The
compensation table below discloses the number and value of restricted shares of
Common Stock that will be issued to James Tilton as a result of services
rendered by Mr. Tilton under the Agreement with InterConnect.
<PAGE>
Number of Restricted Shares of
Name and Position Dollar Value Common Stock to be Issued
James Tilton $5,485* 15,000
Former President and CEO
_____________________________
* The dollar value appearing above was determined by taking the number of
restricted shares received by Mr. Tilton pursuant to the Agreement and
multiplying them by the closing price of the Company's Common Stock on the date
of the Agreement. The closing price for the Company's Common Stock on February
11, 1997 was $0.53. There is, however, no market for restricted shares of the
Company's Common Stock and the numbers above therefore may not reflect the
actual value of the shares received by Mr. Tilton.
IV. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information concerning the
ownership of Common Stock as of March 31, 1997 and is based upon the 4,520,336
shares of Common Stock outstanding on that date. The table discloses each entity
known to the Company to be the beneficial owner of more than 5 percent of the
issued and outstanding Common Stock and the stock holdings of all the Company's
directors and officers. None of the Company's current officers or directors own
any Common Stock. However, as disclosed above, Mark Tolman will be issued 2.3
million shares of Common Stock (approximately 47% of the total shares then to be
issued and outstanding) if and when the Agreement with InterConnect is approved
by the Company's shareholders. None of the other officers or directors will
receive any Common Stock as a result of the Agreement. Additionally, Canton
Financial Services Corporation will receive 316,620 shares of Common Stock
(which will give CFSC ownership of approximately 9.5% of the total shares issued
and outstanding) as consideration for services rendered, once the Agreement is
effective.
Name and Address Amount and Nature of Percent
Title of Class of Beneficial Owner Beneficial Ownership of class
Common Stock A-Z Professional Consultants, Inc. 824,129 18.2%
268 West 400 South, Suite 300
Salt Lake City, UT 84101
Common Stock BRIA Communications Corporation 566,038 12.5%
268 West 400 South, Suite 300
Salt Lake City, Utah 84101
Common Stock Canton Financial Services Corporation 298,507 6.6%
268 West 400 South, Suite 300
Salt Lake City, Utah 84101
Common Stock Richard Surber 418,600 9.3%
268 West 400 South, Suite 300
Salt Lake City, Utah 84101
By order of the board of directors,
/s/ Mark A. Tolman
----------------------
Mark A. Tolman, President
Salt Lake City, Utah
April 7, 1997
<PAGE>
APPENDIX A
TO THE INFORMATION STATEMENT OF
EUROTRONICS HOLDINGS INCORPORATED
ANNUAL REPORT AS REQUIRED BY RULE 14C-3(1)
OF THE EXCHANGE ACT OF 1934, AS AMENDED
<PAGE>
BUSINESS OF ISSUER
The Company was originally incorporated on July 7, 1982 as Hamilton
Exploration Co., Inc. to engage in the investigation, acquisition, exploration,
development and mining of mineral properties. These activities were pursued by
the Company until December 1989 at which time the Company ceased all active
operations. From December 1989 to December 1995 the Company did not engage in
operations of any type. In December 1995, the Company executed an Agreement and
Plan of Exchange (the "Exchange Agreement") with Eurotronics International
Incorporated, a Nevada corporation ("EII"). Pursuant to the Exchange Agreement,
the Company acquired EII as a wholly-owned subsidiary. Through EII, the Company
was to design computer software systems. Pursuant to this acquisition, the
Company assumed its current name, Eurotronics Holdings Incorporated.
On May 8, 1996, the Company, EII and the shareholders of EII executed a
Rescission of Agreement and Release of All Claims (the "Rescission Agreement").
The Rescission Agreement was made effective as of December 20, 1995, thereby
unwinding the acquisition of EII from the beginning. Under the Rescission
Agreement, the Company returned all shares of stock in EII that it had acquired
from EII's shareholders. The shareholders of EII were required to return all
shares of the Company's Common Stock that they had acquired pursuant to the
Exchange Agreement. Both the Company and EII also mutually agreed to release the
other from any and all claims they may have had against the other stemming from
the Exchange Agreement. The decision to rescind the Exchange Agreement was
reached because EII had not been able to obtain audited financial statements as
required by the Exchange Agreement and neither the Company nor EII had the
financial resources to continue to wait for these documents.
As discussed in "Section II - Actions Taken Pursuant to Written
Consent" of the Information Statement and subject to shareholder approval, the
Company will acquire all shares of InterConnect pursuant to the February 11,
1997 Agreement. The Company does not currently have any operations of its own.
However, through InterConnect, the Company would operate an electronic shopping
mall on the World Wide Web. Known as Access Market Square, InterConnect's
electronic mall allows businesses to promote and sell their products over the
Internet. InterConnect designs and programs individual web pages, known as
storefronts, for its clients. A storefront is the equivalent of an electronic
catalog, containing information and advertising related to the vendor's
products.
Access Market Square's web address is http://www.icw.com.
InterConnect currently employs five individuals, including two
programmers and a sales representative. InterConnect's sales representative
seeks out potential clients for its storefronts through a combination of cold
calls and leads generated through general advertising. Once a client is
retained, InterConnect's programmers design a storefront based on the client's
specifications. Currently, most of InterConnect's customers are located in the
Rocky Mountain region. However, the Company is attempting to implement a
marketing plan which will greatly increase the size and geographic scope of
InterConnect's operations. See "Management's Plan of Operation" below.
InterConnect also intends to increase the size of its current professional staff
as its client base expands.
The market for Internet mall service providers is very competitive.
InterConnect's competitors are comprised mostly of small firms who offer
services and prices similar to those of InterConnect. However, several large and
well established companies, such as IBM and Microsoft, have begun to enter this
market. InterConnect competes in this industry based on its status, reputation
and longevity. Access Market Square is one of the oldest Internet malls in
existence, and in the Company's opinion is relatively well-known. Accordingly,
it experiences a large amount of traffic from Internet users. InterConnect is
able to market this exposure opportunity to potential clients.
Neither the Company nor InterConnect currently owns any real property,
and neither has any plans to acquire any real property.
<PAGE>
MANAGEMENT'S PLAN OF OPERATION
As discussed in "Section II - Actions Taken Pursuant to Written
Consent" of the Information Statement and subject to shareholder approval, the
Company will acquire all shares of InterConnect pursuant to the February 11,
1997 Agreement. The Company will hold an annual meeting of shareholders at which
the Agreement will be discussed and submitted to shareholder ballot. If the
Agreement is approved, the Company will conduct all of its operations through
InterConnect. The Company has no other operations, and has not recorded any
revenue from operations during the last two fiscal years. An understanding of
the Company's financial condition is therefore not possible without reference to
the operations and financial condition of InterConnect. Accordingly, even though
the Agreement with InterConnect is not yet effective, the following discussion
will treat the Agreement as if it were effective for purposes of discussing the
Company's plan of operation.
Assuming the Company's shareholders approve the Agreement, the
Company's focus will be to increase InterConnect's revenues by expanding
InterConnect's operations. Pursuant to this objective, the Company will attempt
to implement an aggressive marketing plan. Beginning in 1997, InterConnect
intends to hire two sales professionals to augment its current staff of five. If
hired, these employees will be responsible for making sales calls to targeted
businesses. They will also receive incoming sales calls from leads generated by
Access Market Square's printed and online advertising. The Company also intends
to hire a marketing professional to work with pricing, advertising, product
definition and other key marketing tenets.
To complement its anticipated future telemarketing, the Company intends
to employ a direct mailing campaign. This will consist of postage cards to be
disseminated to approximately 20,000 individuals per month. This advertising
will be targeted to individuals who seek programming and graphic art work in
connection with the development of a personal web page. The goal of this direct
mail marketing plan is to generate leads for the sale of Access Market Square
storefronts. The Company is also planning to conduct a series of seminars to be
held throughout North America during the next fiscal year. The goal of the
seminars is two-fold. First, the Company will conduct face to face marketing of
its storefronts to business entities suitable to market products and services
via Access Market Square. Second, the Company will market business opportunities
to individuals interested in selling Access Market Square storefronts on behalf
of InterConnect. InterConnect has been involved in these seminars in the past
and found them very lucrative.
The Company hopes to implement this marketing plan as a means of
increasing InterConnect's revenues and market penetration. The Company has
estimated the annual cost of this new marketing plan at approximately
$1,408,000. This amount greatly exceeds the $67,825 in expenses which
InterConnect recorded on its most recent audited financial statements, and will
therefore put increased strain on InterConnect's liquidity. However, the Company
believes that such expenditures will result in revenues for InterConnect that
greatly exceed its previous revenues. Therefore, the Company has estimated that
much of the cash flow necessary to implement the marketing plan can be generated
through revenues. These estimates are based on a business plan formulated by the
Company's management. The Company is currently investigating additional methods
of potential financing, including a potential future private offering of debt
securities and/or a public or private offering of its Common Stock. The Company
can provide no assurances that InterConnect's revenues will be sufficient to
cover its marketing costs or that other means of raising capital will be
available to InterConnect.
If the Agreement is approved by a majority of the Company's
shareholders, the Company anticipates spending an additional $50,000 on computer
equipment and Internet connection fees to improve its current facilities. The
Company believes that these capital expenditures are necessary for InterConnect
to maintain its current service level in light of anticipated increases in the
scope of InterConnect's operations. Management believes that the cash needed for
this equipment can also be generated through InterConnect's revenues or through
an offering of the Company's securities.
If the Agreement is not ultimately approved, the Company will likely
resume its quest for a suitable merger or acquisition candidate. Since the
Company does not have any current sources of revenue, it is likely that any
future merger or acquisition would involve the Company issuing shares of its
Common Stock.
<PAGE>
MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock began trading on the OTC Bulletin Board on
November 15, 1995 under the symbol "HMLD." In December 1995, the symbol changed
to EUHI to reflect the change in the Company's name. The table set forth below
lists the range of high and low bids of the Company's Common Stock as reported
by NASDAQ for each quarter subsequent to the time trading commenced on November
15, 1995 through March 31, 1997. The prices in the table reflect inter-dealer
prices, without retail markup, markdown or commission and may not represent
actual transactions.
Calendar Year Quarter High Low
1995 Fourth (partial period) .4375 .25
1996 First .75 .25
Second .75 .13
Third 1.31 .13
Fourth 1.31 .28
1997 First 1.37 .38
As of March 31, 1997, there were approximately 571 holders of record of
the Company's Common Stock.
Dividends
The Company has not declared any dividends on its Common Stock during
the last two fiscal years. There are no restrictions that limit the Company's
ability to pay dividends, other than those generally imposed by applicable state
law. The future payment of dividends, if any, on the Common Stock is within the
discretion of the board of directors and will depend on the Company's earnings,
capital requirements, financial condition, and other relevant factors. The
Company does not anticipate the payment of future dividends.
CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS
The Company has not had a change of accountants in the preceding two
fiscal years.
LEGAL PROCEEDINGS
The Company is not currently a party to any pending legal proceedings.
FINANCIAL AND OTHER INFORMATION
The Company's audited financial statements for fiscal year ended
December 31, 1995, unaudited financial statements for fiscal quarter ended
September 30, 1996, pro forma financial statements for proposed merger with
InterConnect West, Inc. and audited financial statements of InterConnect West,
Inc. for fiscal year ended December 31, 1995 are attached as Appendices B-D to
the Information Statement.
UNDERTAKING REGARDING FORM 10-KSB
The Company hereby undertakes to provide without charge to each person
receiving this Information Statement and Annual Report, on the written request
of such person, a copy of its latest annual report on Form 10-KSB including the
financial statements and financial statement schedules, required to be filed
with the Securities and Exchange Commission pursuant to Rule 13a-1 under the
Act. This written request should be addressed to Mark Tolman at the Company's
headquarters at 470 East 3900 South, Suite 205, Salt Lake City, Utah 84107.
<PAGE>
APPENDIX B
TO THE INFORMATION STATEMENT OF
EUROTRONICS HOLDINGS INCORPORATED
AUDITED FINANCIAL STATEMENTS OF EUROTRONICS HOLDINGS INCORPORATED
FOR FISCAL YEAR ENDED DECEMBER 31, 1995
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Stockholders and Board of Directors
of Eurotronics Holdings, Inc. (formerly
Hamilton Exploration Co., Inc.)
Salt Lake City, Utah
We have audited the balance sheet of Eurotronics Holdings, Inc. (a development
stage company) as of December 31, 1995 and the related statements of operations,
changes in stockholders' equity, and cash flows from the date of inception
(January 7, 1982) through December 31, 1995. 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 audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits 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 audits provide a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Hamilton Exploration Co., Inc.
as of December 31, 1995 and the results of its operations, its changes in
stockholders' equity and its cash flows from the date of inception (January 7,
1982) through December 31, 1995, in conformity with generally accepted
accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 2 to the
financial statements, since its inception (January 7, 1982), the Company has
been in the development stage and has suffered recurring losses from operations,
raising substantial doubt about its ability to continue as a going concern. The
long term continuation of the Company as a going concern is dependent upon the
Company's ability to obtain additional capital. The financial statements do not
include any adjustments that might result if the Company is unable to obtain
additional capital.
/s/ Anderson, Anderson & Strong
- - --------------------------------
Anderson, Anderson & Strong
June 24, 1996
Salt Lake City, Utah
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
BALANCE SHEET
December 31, 1995
ASSETS
CURRENT ASSETS
<S> <C>
Cash ...................................................... $ 6,056
--------
Total current assets ..................................... 6,056
OTHER ASSETS
Investments - securities (Note 6) ......................... 169,812
--------
$175,868
========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accrued expenses ........................................ $ 52,089
---------
Total Current Liabilities ............................. 52,089
---------
STOCKHOLDERS' EQUITY (Note 1):
Common stock, $.0001 par value;
Authorized, 200,000,000 shares;
Issued, 4,420,336 shares at
at December 31, 1995 ................................... 442
Additional paid-in capital .............................. 884,734
Deficit accumulated during
development stage ..................................... (761,397)
---------
123,779
---------
$ 175,868
=========
The accompanying notes are an integral part of these
financial statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
STATEMENTS OF OPERATIONS
Years Ended December 31, 1995 and 1994
Period From Date Of Inception (January 7, 1982) Through December 31, 1995
Inception
Through
Dec. 31,
1995 1994 1995
Revenue:
<S> <C> <C> <C>
Interest income ................ $ -- $ -- $ 61,208
--------- --------- ---------
-- -- 61,208
--------- --------- ---------
Expenses:
Investigation, evaluation and
exploration of prospective
mineral properties ............ -- -- 424,416
General and administrative ..... 321,124 -- 399,616
Amortization and depreciation .. -- -- 1,000
--------- --------- ---------
321,124 -- 825,032
--------- --------- ---------
Net loss before taxes and
extraordinary item ............. (321,124) -- (763,824)
Tax expense .................... -- -- 183
--------- --------- ---------
Loss before extraordinary item ... (321,124) -- (764,007)
Extraordinary item - debt
settlement (note 7) ............ 2,610 -- 2,610
--------- --------- ---------
NET LOSS ......................... $(318,514) $ -- $(761,397)
========= ========= =========
NET INCOME (LOSS) PER COMMON SHARE
Loss before extraordinary item $ (.70) $ --
Extraordinary item ............. .01 --
--------- ---------
TOTAL ............................ $ (.69) $ --
========= =========
Weighted average number of shares
outstanding ..................... 461,825 54,412
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Period From Date of Inception (January 7, 1982) Through December 31, 1995
Additional
Common Stock Common Stock Paid-in Accumulated
Shares Amount Capital Deficit
<S> <C> <C> <C> <C>
Issuance of common stock to incorporators
for cash - 1982 ........................................... 15,000,000 $ 1,500 $ 28,500 $ --
Change in number of shares issued to ....................... -- -- -- --
incorporators and price per share - 1983 .................. 2,142,857 214 ( 214) --
Issuance of common stock for cash - 1983 ................... 14,285,715 1,429 23,571 --
Public stock offering for cash, net of $111,627
in underwriting expenses - 1984 ........................... 49,500,000 4,950 378,423 --
Sale of warrants (no warrants exercised - expired 1989) .... -- -- 100 --
Net loss for the period from date of inception
(January 7, 1982) through December 31, 1993 ............... -- -- -- ( 442,883)
----------- ----------- ----------- -----------
Balance December 31, 1993 .................................. 80,928,572 8,093 430,380 (442,883)
----------- ----------- ----------- -----------
Results of operations year ended December 31, 1994 ......... -- -- -- --
----------- ----------- ----------- -----------
Balance December 31, 1994 .................................. 80,928,572 8,093 430,380 ( 442,883)
----------- ----------- ----------- -----------
Reverse stock split 1 for 1,500 ............................ (80,874,160) ( 8,088) 8,088 --
Issuance of shares for no determinable
consideration - May, 1995 ................................. 76,667 8 ( 8) --
Issuance of shares for cash - July, 1995 ................... 172,500 17 17,233 --
Issuance of shares for services - July, 1995 ............... 10,000 1 999 --
Issuance of shares for debt - July, 1995 (note 7) .......... 226,500 23 22,627 --
Isuance of shares for cash - November, 1995 ................ 510,000 51 50,949 --
Issuance of shares for services - November, 1995 ........... 112,000 11 11,189 --
Issuance of shares for cash - December, 1995 ............... 222,222 22 39,978 --
Issuance of shares for services - December, 1995 ........... 1,337,921 134 133,658 --
Issuance of shares for assets - December, 1995 ............. 1,698,114 170 169,641 --
Results of operations year ended December 31, 1995 ......... -- -- -- (318,514)
----------- ----------- ----------- -----------
Balance December 31, 1995 .................................. 4,420,336 $ 442 $ 884,734 $ (761,397)
=========== =========== =========== ===========
The Accompany notes are an integral part of these financial statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
STATEMENTS OF CASH FLOWS
Years Ended December 31, 1995 and 1994
Period From Date Of Inception (January 7, 1982) Through December 31, 1995
Inception
Through
Dec. 31,
1995 1994 1995
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C> <C>
Net (Loss) .................................................... $(318,514) $ -- $(761,397)
--------- ---------
Adjustments to reconcile net (loss) to net cash
used by operating activities:
Increase (decrease) in accrued liabilities ................. 47,679 -- 52,089
Services paid with common stock ............................ 145,992 -- 145,992
Common stock issued for debt ............................... 22,650 -- 22,650
--------- ---------
Total adjustments .......................................... 216,321 -- 220,731
--------- ---------
Net cash (used) by operating activities ....................... (102,193) -- ( 540,666)
---------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contributions by incorporators ........................ -- -- 55,000
Proceeds from public stock offering ........................... -- -- 383,473
Issuance of common stock for cash ............................. 108,249 -- 108,249
--------- ---------
Net cash provided by financing activities ..................... 108,249 -- 546,722
--------- ---------
Net increase in cash ............................................ 6,056 -- 6,056
Cash, beginning ................................................. -- -- --
--------- ---------
Cash, ending .................................................... $ 6,056 $ -- $ 6,056
=========== ========= =========
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Issuance of common stock for services ......................... $ 145,992 $ -- $ 145,992
========= =========
Issuance of common stock for debt ............................. $ 22,650 $ -- $ 22,650
========= =========
Issuance of common stock for investments ...................... $ 169,812 $ -- $ 169,812
========= =========
The accompanying notes are an integral part of these financial statements
</TABLE>
<PAGE>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
NOTES TO FINANCIAL STATEMENTS
As of December 31, 1995 and 1994
1. BUSINESS ACTIVITY
The Company was incorporated as a Utah corporation on January 7, 1982 for
the primary purpose of investigating and evaluating prospective mineral
properties for possible acquisition. On January 27, 1982, the Company sold
15,000,000 shares of its $.001 par value common stock for investment purposes to
two corporations and four individuals at $.002 per share for a total of $30,000.
On July 27, 1983, the Company adjusted the number of shares issued to reflect a
purchase price of $.00175 per share instead of $.002 per share. On August 5,
1983, the Company sold an additional 14,285,714 shares at $.00175 to two
affiliated corporations and two individuals for $25,000. During 1984, the
Company sold 49,500,000 shares of its common stock to the public at $.01 per
share and received net proceeds of $383,373. On May 22, 1995 the Company adopted
a 1,500 to 1 reverse stock split. On May 23, 1995 the Company issued 76,667
shares of common stock for services of undetermined value. Also during 1995 an
additional 4,289,257 shares were issued: 904,722 for cash, 1,459,921 for
services, 226,500 for debt, and 1,698,114 for other assets.
On December 20, 1995 the Company approved an Agreement and Plan of Exchange
between the Company, Eurotronics International Incorporated (EII) and EII's
shareholders. The agreement stipulated that the Company issue and exchange
shares of its common stock for all of the issued and outstanding shares of the
common stock of EII. On May 8, 1996, the Company, EII and EII,s shareholders
executed a rescission of the agreement. The rescission was made effective as of
the date of the original agreement, December 20, 1995. Pursuant to the
agreement, all shares of stock previously issued were returned, and all parties
agreed to hold one another harmless. Consistent with the effective date of the
rescission, this transaction has been considered void from its inception and,
therefore, is not reflected in the financial statements.
The Company's unpatented mining claims and mineral leases which were
acquired in 1987 have been lost because the Company had insufficient capital to
pay the mineral lease requirements and to perform the required minimum
assessment work. Between 1987 and April, 1994, the Company's activity was
largely restricted to maintaining its corporate legal status. The Company's
current business plan is to merge with or acquire another business entity.
<PAGE>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
NOTES TO FINANCIAL STATEMENTS - Continued
As of December 31, 1995 and 1994
2. GOING CONCERN
The Company is in the development stage and has suffered recurring losses
since inception. Its continuation as a going concern will ultimately depend on
obtaining additional capital. The Company believes it can sustain its existence
for the next twelve months.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization Costs
Organization costs were capitalized and amortized over 60-month period on a
straight-line basis.
Exploration Expenses
Exploration expenditures were charged to expense as incurred. No mineral
reserves feasible for development were discovered.
Income (Loss) Per Share
The computation of income (loss) per common share is based on the average
number of shares outstanding during the period. A reverse stock split in May,
1995 is considered to have occurred retroactively for all periods shown in
statements of operations.
4. INCOME TAXES
Effective January 1, 1993, the Company adopted Statement of Financial
Accounting Standards No. 109, Accounting for Income Taxes. The cumulative effect
of the change in accounting principle is immaterial. At December 31, 1995 the
Company had a net operating loss ("NOL") carryforward for United States income
tax purposes of approximately $760,000. The NOL carryforward expires in
increments beginning in 1999. The Company's ability to utilize its net NOL
carryforward is subject to the realization of taxable income in future years,
and under certain circumstances, the Tax Reform Act of 1986 restricts a
corporation's use of its NOL carryforward. Furthermore, due to the Company's
issuance of additional stock in 1995, the use of its NOL carryforward could be
substantially limited. The Company believes that there is at least a 50% chance
that the carryforward will expire unused, therefore, no tax benefit has been
reported in the financial statements.
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
NOTES TO FINANCIAL STATEMENTS - Continued
As of December 31, 1995 and 1994
5. RELATED PARTY TRANSACTIONS
On June 29, 1995 the Company entered into a consulting agreement with
Canton Financial Services Corporation (CFS). At the time the consulting
agreement was executed, Richard Surber was the sole officer and sole director of
CFSC and also a director and vice president of the Company. On April 1, 1996 the
Company executed a new consulting agreement with CFSC which replaced the
previous one. Mr. Surber is no longer associated with the Company as an officer
or director. During 1995 the Company issued a total of 112,000 shares of its
common stock to CFS for services rendered in the amount of $11,200. The Company
also issued 185,600 shares to Richard Surber to satisfy a debt owed to CFS for
services rendered in the amount of $18,560, and 333,000 shares for services
rendered in the amount of $33,300.
During 1995 the Company issued 141,900 shares of its common stock to Ken
Kurtz, the former president of the Company, for services rendered in the amount
of $14,190. The Company also issued 83,792 shares to Parkstreet Investments for
services relating to the Eurotronics International acquisition in the amount of
$8,379. Mr. Kurtz is president of Parkstreet Investments.
In December of 1995, the Company executed several stock exchange and stock
purchase agreements with companies which are under common control. All shares of
stock issued pursuant to these agreements are restricted as regulated by Rule
144 under the Securities Act. The stock exchange and purchase agreements were
executed between the Company and: BRIA Communications, OMAP Holdings
Incorporated, and Tianrong Building Material Holdings, Ltd. At the time of the
of the exchanges, the Company's president was also an officer and director of
each of the other three corporations.
6. INVESTMENTS
Investment securities consist of the following at December 31,
1995:
Company Amount
OMAP $ 56,604
Tianrong 56,604
BRIA Communications 56,604
$169,812
<PAGE>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
NOTES TO FINANCIAL STATEMENTS - Continued
As of December 31, 1995 and 1994
6. INVESTEMENTS - continued
Investments in equity securities that have readily determinable fair values
are stated at their market value in accordance with Financial Accounting
Standards ("FAS") No. 115. None of the above securities meets the specified
requirements of FAS No. 115 because they are restricted under Rule 144 of the
Securities Act. Valuation of other equity security investments are based on
acquisition costs. Markdowns are made to reflect significant impairment in
values.
7. DEBT SETTLEMENT
During 1995, the Company settled a debt with its transfer agent for cash,
resulting in a gain of $2,610. Also during 1995, the Company settled other debt
through the issuance of equity shares with no gain or loss, since the value of
shares issued was considered to be equal to the amount of the debt.
8. SUBSEQUENT EVENTS
Refer to Note 1. for a discussion of the rescinded transaction with
Eurotronics International Incorporated and its shareholders.
<PAGE>
APPENDIX C
TO THE INFORMATION STATEMENT OF
EUROTRONICS HOLDINGS INCORPORATED
UNAUDITED FINANCIAL STATEMENTS FOR EUROTRONICS HOLDING INCORPORATED
FOR FISCAL QUARTER ENDED SEPTEMBER 30, 1996
AND PROFORMA FINANCIAL STATEMENT FOR
PROPOSED MERGER WITH INTERCONNECT WEST, INC.
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
INDEX TO FINANCIAL STATEMENTS PAGE
Balance Sheets...............................................................F-1
Statements of Operations.....................................................F-2
Statements of Stockholders' Equity...........................................F-3
Statements of Cash Flows.....................................................F-4
Notes to Financial Statements................................................F-5
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
Balance Sheet
September 30, 1996 (Unaudited) and December 31, 1995
September 30 December 31
1996 1995
----------- -----------
ASSETS
Current Assets
<S> <C> <C>
Cash ...................................... $ 0 $ 6,056
Total Current Assets ......................... 0 6,056
Other Assets
Investment - securities ................... 0 169,812
TOTAL ASSETS ................................. $ 0 $175,868
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accrued expenses ........................... $ 1,842 $ 52,089
Total Current Liabilites ...................... 1,842 52,089
--------- --------
Shareholders' Equity
Common stock par value $.0001; 200,000,000
shares authorized; 4,420,336 and 4,420,336
shares issued ............................. 442 442
Additional paid-in capital ................. 884,734 884,734
Deficit accumulated during development stage (887,018) (761,397)
--------- --------
Total Shareholders' Equity .................... (1,842) 123,779
--------- --------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY .......................... $ 0 $ 175, 868
========= ========
See notes to financial statements.
F-1
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
STATEMENTS OF OPERATIONS
For The Three Months Ended September 30, 1996 and September 30, 1995 (Unaudited)
For The Nine Months Ended September 30, 1996 and September 30, 1995 (Unaudited)
Period From Date of Inception (January 7, 1982) Through September 30, 1996 (Unaudited)
Inception
Three Three Nine Nine Through
Months Months Months Months September 30,
1996 1995 1995 1995 1996
---------- ----------- -------- ----------- ----------
Revenue:
<S> <C> <C> <C> <C> <C>
Debt settlement .................................... $ -- $ -- $ -- $ 2,610 $ 2,610
Interest Income .................................... -- -- -- -- 61,208
----------- ----------- ----------- ----------- -----------
2,610 63,818
Expenses:
Investigation, evaluation and exploration of
prospective mineral properties ................. -- -- -- -- 424,416
General and administrative ......................... 89,718 53,389 97,320 87,557 433,484
Amortization and depreciation ...................... -- -- -- -- 1,000
Loss on investment securities ...................... 28,301 -- 28,301 -- 28,301
----------- ----------- ----------- ----------- -----------
118,019 53,389 125,621 87,557 887,201
----------- ----------- ----------- ----------- -----------
Income (Loss) before income taxes ....................... (118,019) (53,389) (125,621) (84,947) (887,201)
Income taxes ....................................... -- -- -- -- 183
----------- ----------- ----------- ----------- -----------
NET INCOME (LOSS) ....................................... $ (118,019) $ (53,389) $ (125,621) $ (84,947) (887,018)
============ ============ ============ =========== ===========
NET INCOME (LOSS) PER COMMON SHARE ...................... $ (0.03) $ (0.26) $ (0.03) $ (0.41)
=========== =========== =========== ===========
average number of shares outstanding ................... 4,420,336 206,752 4,420,336 206,752
=========== =========== =========== ===========
See notes to financial statements.
F-2
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
STATEMENTS OF STOCKHOLDER' EQUITY
Period From Date of Inception ( January 7, 1982) Through September 30, 1996 (Unaudited)
Additional
Common Stock Common Stock Paid-In Accumulated
Shares Amount Capital Deficit
Issuance of common stock to incorporators
<S> <C> <C> <C> <C>
for cash - 1992 ...................................... 15,000,000 $ 1,500 $ 28,500 --
Change in number of shares issued to
incorporators and price per share - 1983 ............. 2,142,857 214 (214) --
Issuance of common stock fr cash - 1983 ................ 14,285,715 1,429 23,571 --
Public stock offering for cash, net of $111,627
in underwriting expenses - 1984 ...................... 49,500,000 4,950 378,423 --
Sale of warrants ....................................... -- -- 100 --
Net loss for the period from date of inception
(January 7, 1982) through December 31, 1992 .......... -- -- -- (442,883)
Balance December 31, 1992 .............................. 80,928,572 8,093 430,830 (442,883)
----------- ----------- ----------- -----------
Results of operations year ended Dec 31, 1993 .......... -- -- --
----------- ----------- ----------- -----------
Balance December 31, 1993 .............................. 80,928,572 8,093 430,830 (442,883)
----------- ----------- ----------- -----------
Results of operations year ended Dec 31, 1994 .......... -- -- -- --
----------- ---------- ---------- -----------
Balance December 31, 1994 .............................. 80,928,572 8,093 430,830 (442,883)
----------- ---------- ---------- -----------
Reverse stock split, 80, 928, 572 to 54,412 ............ (80,874,160) (8,088) 8,088 --
Issuance of shares for no determinable
consideration - May 1995 ............................. 76,667 8 (8) --
Issuance of shares for cash - July 1995 ................ 172,500 17 17,233 --
Issuance of shares for services - July 1995 ............ 10,000 1 999 --
Issuance of shares for debt - July 1995 ................ 226,500 23 22,627 --
Issuance of shares for cash - November 1995 ............ 510,000 51 50,949 --
Issuance of shares for services - November 1995 ........ 112,000 11 11,189 --
Issuance of shares for cash - December 1995 ............ 222,222 22 39,978 --
Issuance of shares for services - December 1995 ........ 1,337,921 134 133,658 --
Issuance of shares for assets - December 1995 .......... 1,698,114 170 169,641 --
Results of operations year ended Dec 31, 1995 .......... -- -- -- (318,514)
----------- ---------- -------- ---------
Balance December 31, 1995 .............................. 4,420,336 $ 442 $ 884,734 $ (761,397)
----------- ---------- --------- --------
Results of operations nine months ended
September 30, 1996 .................................. -- -- -- (125,621)
Balance September 30, 1996 ............................. 4,420,336 $ 442 $ 884,734 $ (887,018)
========== =========== =========== ===========
See notes to financial statements.
F-3
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
STATEMENT OF CASH FLOWS
Nine Months Ended September 30, 1996 and September 30, 1995 (Unaudited)
Period From Date of Inception ( January 7, 1982) Through September 30, 1996 (Unaudited)
Inception
Nine Nine Through
Months Months September 30,
1996 1995 1996
---------- ----------- ----------
CASH FLOWS FROM OPERATING ACTIVITES:
<S> <C> <C> <C>
Net (Loss) .............................................. $(125,621) $ (84,947) $(887,018)
Adjustments to reconcle net (loss) to net cash
used by operating activities:
Increase (decrease) in accrued liabilities .......... (50,247) 44,074 1,842
Services paid with common stock ..................... -- 23,650 145,992
Common stock issued for debt ........................ -- -- 22,650
Permanent decline in investments .................... 28,301 -- 28,301
Decrease in assets:
Investments ......................................... 141,511 -- 141,511
-------- -------- --------
Total Adjustments ......................................... 119,565 67,724 340,296
--------- --------- ---------
Net cash (used) by operating activities ................. (6,056) (17,223) (546,722)
--------- ---------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contributions by incorporators .................. -- -- 55,000
Proceeds from public stock offering ..................... -- -- 383,473
Issuance of common stock for cash ....................... -- 17,250 108,249
---------- --------- --------
Net cash provided by financing activities ............... -- 17,250 546,722
--------- --------- ---------
Net increase in cash .................................... (6,056) 27 0
Cash, beginning ......................................... 6,056 0 0
--------- --------- ---------
Cash, ending ............................................ $ 0 $ 27 $ 0
========== ========= =========
See notes to financial statements.
F-4
</TABLE>
<PAGE>
EUROTRONICS HOLDINGS, INC.
(A Development Stage Company)
Formerly Hamilton Exploration Co., Inc.
NOTES TO FINANCIAL STATEMENTS
September 30, 1996
NOTE 1: Basis of Presentation
The accompanying consolidated unaudited condensed financial statements have been
prepared by management in accordance with the instructions in Form 10-QSB and
therefore, do not include all information and footnotes required by generally
accepted accounting principles and should therefore be read in conjunction with
the Company's Annual Report to Shareholders on Form 10-KSB for fiscal year ended
December 31, 1995.
In management's opinion, the accompanying consolidated unaudited condensed
financial statements contain all adjustments, consisting of normal recurring
adjustments necessary for a fair statement of the results for the interim
periods presented. The interim operation results are not necessarily indicative
of the results for the fiscal year ending December 31, 1996.
NOTE 2: Debt Settlement
Effective July 16, 1996, the Company settled all prior fees due to Canton
Financial Services Corporation ("CFS") in connection with its consulting
agreement by transferring the Companys's investment securities to CFS. This
transaction eliminated all of the Company's liabilites at the time and left the
Company with no assets.
NOTE 3: Proposed Acquisition of InterConnect West, Inc.
On July 16, 1996, the Company executed an Agreement for Exchange of Stock with
InterConnect West, Inc., a Utah corporation ("ICW"), and Mark Tolman who prior
to the Agreement owned 100% of the outstanding stock of ICW. The Agreement was
made effective July 31, 1996. On February 11, 1997, the Company executed an
Amended Agreement for the Exchange of Stock ("Agreement") which superceded the
July 16, 1996 agreement between the parties. Under this Agreement, the Company
will acquire all outstanding shares of ICW, making ICW the Company's
wholly-owned subsidiary. The Agreement is subject to the approval of a majority
of the Company's shareholders and is not yet effective. All references to common
stock mentioned in this paragraph account for a 1 for 2 reverse stock split,
which is to be effected by Eurotronics at or before closing of theAgreement.
Under the Agreement the common stock of ICW (1,000 shares with a par value of
$1.00) will be transferred to the Company and the Company will issue 2,300,000
shares of its common stock to Mark Tolman. In addition, 316,620 shares of common
stock will be issued to CFS for services rendered to the Company in connection
with the Agreement. CFS is also due a payment of $100,000 cash payment within 90
days of the execution of the Agreement. Also, 15,000 shares of common stock will
be issued to James Titlon, the Company's former president and director for
services rendered in the negotiation of the Agreement.
NOTE 4: Pro forma Statements
For financial accounting purposes the proposed acquisition of ICW (see note 3)
will be treated as a reverse acquisition and ICW will be treated as acquiring
the Company. Pro forma statements presented herein are those of ICW and the
limited assets and liabilities of Eurotronics have been recorded under the
purchase method of accounting at their historical costs. The pro forma
statements include the operations of ICW for all periods presented with the
operations of Eurotronics included from the date of recapitalization. The
operations of Eurotronics were immaterial prior to the recapitalization.
F-5
<PAGE>
<TABLE>
<CAPTION>
Pro Forma Combined Balance Sheet
September 30, 1996 and December 31, 1995
September 30, December 31,
1996 1995
--------- -----------
ASSETS
Current Assets
<S> <C> <C>
Cash ........................................... $ 21,272 $ 17,782
Accounts Receivable ............................ 89,375 17,770
--------- ---------
Total Current Assets ........................... 110,647 35,552
Equipment, net depreciation .......................... 37,317 23,638
TOTAL ASSETS ......................................... $ 147,964 $ 59,190
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable ............................... $ 22,074 $ 4,822
Accrued Expenses ............................... $ 106,842 $ 21,629
Current portion of long-term debt .............. -- 4,284
--------- ---------
Total Current Liabilities ...................... 128,916 30,735
Long Term Debt ....................................... 30,000 25,716
--------- ---------
TOTAL LIABILITIES .................................... 158,916 56,451
STOCKHOLDERS' EQUITY:
Common stock, $.0001 par value;
Authorized, 200,000,000 shares;
Issued, 4,841,788 shares at September 30, 1996 . 484 1,000
Additional paid-in capital ..................... 7,401 3,764
Accumulated Deficit ............................ (18,353) (2,025)
--------- ---------
TOTAL STOCKHOLDERS' EQUITY ........................... (10,952) 2,739
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY ........... $ 147,964 $ 59,190
========= =========
</TABLE>
F-6
<PAGE>
<TABLE>
<CAPTION>
Pro Forma Combined Statement of Operations
For The Three Months Ended September 30, 1996 and September 30, 1995
For the Nine Months Ended September 30, 1996 and September 30, 1995
Three Three Nine Nine
Months Months Months Months
1996 1995 1996 1995
--------------- --------------- --------------- ---------------
<S> <C> <C> <C> <C>
Revenue .............................................. $ 84,560 $ 63,020 $ 253,762 $ 81,999
Cost of Revenue ...................................... $ 29,165 $ 31,133 $ 99,713 $ 46,568
----------- -----------
Gross Profit ......................................... 55,395 31,887 154,049 35,431
Expenses:
General and administrative ..................... 124,760 22,029 166,739 32,312
Amortization and depreciation .................. 1,213 -- 3,638 --
----------- ----------- ----------- -----------
125,973 22,029 170,377 32,312
----------- ----------- ----------- -----------
Income (Loss) before income taxes: ................... (70,578) 9,858 (16,328) 3,119
Income taxes ................................... -- -- -- --
----------- ----------- ----------- -----------
NET INCOME (LOSS) .................................... $ (70,578) $ 9,858 $ (16,328) $ 3,119
=========== =========== =========== ===========
NET INCOME (LOSS) PER COMMON SHARE ................... $ -- $ -- $ -- $ --
=========== =========== =========== ===========
Weighted average number of shares
outstanding .......................................... 4,841,788 4,841,788 4,841,788 4,841,788
=========== =========== =========== ===========
F-7
</TABLE>
<PAGE>
NOTE 6: Additional footnotes included by reference
Except as indicated in the footnotes above there has been no other material
change in the information disclosed in the notes to the financial statements
included in the Company Annual Report on Form 10-KSB for the year ended December
31, 1995. Therefore those footnotes are included herein by reference.
F-8
<PAGE>
APPENDIX D
TO THE INFORMATION STATEMENT OF
EUROTRONICS HOLDINGS INCORPORATED
AUDITED FINANCIAL STATEMENTS OF INTERCONNECT WEST, INC.
FOR FISCAL YEAR ENDED DECEMBER 31, 1995
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
To the Stockholders and Board of Directors of
InterConnect West, Inc.
Salt Lake City, Utah
We have audited the accompanying balance sheet of InterConnect West, Inc. (an S
Corporation), as of December 31, 1995, and the related statements of operations,
stockholders' equity and cash flows for the period April 21, 1995 (date of
inception) to December 31, 1995. 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 InterConnect West, Inc. (an S
Corporation) as of December 31, 1995, and the results of its operations and cash
flows for the period April 21, 1995 (date of inception) to December 31, 1995, in
conformity with generally accepted accounting principles.
/s/Andersen, Andersen & Strong
- - -----------------------------
October 31, 1996
Salt Lake City, Utah
<PAGE>
<TABLE>
<CAPTION>
INTERCONNECT WEST, INC.
BALANCE SHEET
December 31, 1995
ASSETS
CURRENT ASSETS
<S> <C>
Cash and cash equivalents ................................... $17,782
Accounts receivable, net of allowance
for doubtful accounts of $5,357 .......................... 17,770
Total Current Assets .................................. 35,552
PROPERTY AND EQUIPMENT, at cost, net
of accumulated depreciation (Notes 2 and 3) ................. 23,638
$59,190
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
<S> <C>
Accounts payable ................................................ $ 4,822
Accrued expenses ................................................ 21,629
Current portion of long-term debt (Note 4) ...................... 4,284
Total Current Liabilities .................................... 30,735
LONG-TERM DEBT (Note 4) ............................................ 25,716
COMMITMENTS AND CONTINGENCIES
(Notes 6, 7 and 8) .............................................. --
STOCKHOLDERS' EQUITY
Common stock, $1,00 par value; authorized
1,000,000 shares; issued and outstanding 1,000 shares (Note 5) .. 1,000
Additional paid-in capital (Note 5) ............................. 3,764
Retained deficit ................................................ (2,025)
Total Stockholders' Equity ................................... 2,739
$ 59,190
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTERCONNECT WEST, INC.
STATEMENT OF OPERATIONS
For the Period April 21, 1995 (Date of Inception) to December 31, 1995
REVENUES
<S> <C>
Advertising income ......................................... $ 103,854
Consulting income .......................................... 22,419
Graphics design income ..................................... 19,944
Other income ............................................... 196
Total Revenues .......................................... 146,413
COST OF SALES ................................................. 80,613
GROSS PROFIT .................................................. 65,800
GENERAL AND ADMINISTRATIVE EXPENSES
Auto expense ............................................... 3,760
Bad debt expense ........................................... 5,357
Depreciation ............................................... 4,882
Insurance .................................................. 732
Interest ................................................... 3,685
Meals and entertainment .................................... 1,253
Other 3,765
Office supplies ............................................ 2,985
Professional ............................................... 2,204
Rent ....................................................... 6,951
Recruiting expense ......................................... 6,287
Telephone .................................................. 17,255
Wages and employee benefits ................................ 8,709
Total General and Administrative Expenses ............... 67,825
Net loss ............................................... $ (2,025)
Loss per share (Note 2) ................................. $ (2.03)
Weighted average number of shares outstanding ........... 1,000
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTERCONNECT WEST, INC.
STATEMENT OF CASH FLOWS
For the Period April 21, 1995 (Date of Inception) to December 31, 1995
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C>
Net loss ........................................................ $ (2,025)
Adjustments to reconcile net loss to cash provided
by operating activities:
Depreciation ................................................. 4,882
Bad debt expense ............................................. 5,357
Changes in operating assets and liabilities:
Accounts receivable .......................................... (23,127)
Accounts payable ............................................. 4,822
Accrued expenses ............................................. 21,629
Net Cash Provided by Operating Activities ................. 11,538
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment - net ..................... (23,756)
Net Cash Used in Investing Activities ..................... (23,756)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of long-term debt ...................................... 30,000
Net Cash Provided by Financing Activities ................. 30,000
Net increase in cash and cash equivalents ....................... 17,782
Cash and cash equivalents at beginning of period ................ --
Cash and Cash Equivalents at End of Period ................ $ 17,782
SUPPLEMENTAL SCHEDULE OF NON-CASH
INVESTING AND FINANCING ACTIVITIES
Transfer of assets and assumption of liabilities
in exchange for 1,000 shares of common stock (See Note 5) . $ 4,764
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
INTERCONNECT WEST, INC.
STATEMENT OF STOCKHOLDERS' EQUITY
For the Period April 21, 1995 (Date of Inception) to December 31, 1995
Additional
Common Stock Paid-in Retained
Shares Amount Capital Deficit Total
Issuance of common shares
for assets and the assumption
of liabilities ($4.76 per share)
<S> <C> <C> <C> <C> <C>
(Note 5) ..................... 1,000 $ 1,000 $ 3,764 $ -- $ 4,764
Net loss for the period April 21,
1995 (date of inception) to
December 31, 1995 ............ -- -- -- (2,025) (2,025)
Balance at December 31, 1995 .... 1,000 $ 1,000 $ 3,764 $(2,025) $ 2,739
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INTERCONNECT WEST, INC.
NOTES TO FINANCIAL STATEMENTS
December 31, 1995
1. ORGANIZATION AND BUSINESS ACTIVITY
Interconnect West, Inc. (the Company) was organized under the laws of the State
of Utah on April 21, 1995. The Company provides Internet marketing services
including the graphic design of web sites, consulting and Internet connection
services. The Company also sells store front sites in an on-line mall displayed
on the world wide web designed and operated by the Company called Access Market
Square.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash and Cash Equivalents
The Company considers all highly liquid instruments purchased with original
maturities of less than three months to be cash equivalents.
Income Taxes
The Company has elected to be taxed under the provisions of Subchapter S of the
Internal Revenue Code. Under those provisions, the Company does not pay federal
corporate income taxes on its taxable income. Instead, the shareholders are
liable for individual federal income taxes on their respective share of the
Company's taxable income.
As described in Note 7 to the financial statements, on June 17, 1996, the
Company entered into an agreement with Eurotronics Holdings Incorporated (EHI)
whereby, the Company would exchange all of its issued and outstanding shares of
capital stock for 90% of the issued and outstanding common stock of EHI. As a
result, the Company will lose its "S" status classification and will be taxed as
a "C" corporation under the Internal Revenue Code.
Property and Equipment
Property and equipment are stated at cost. Depreciation is calculated on a
straight-line basis over the estimated useful lives of the assets. Maintenance
and repairs are charged to operations when incurred. Betterments and renewals
are capitalized.
Dividend Policy
The Company anticipates that for the foreseeable future its earnings will be
retained for use in its business and no cash dividends will be paid. Declaration
and payment of dividends will remain within the discretion of the Company's
board of directors and will depend upon the Company's growth , profitability,
financial condition and other factors which the board of directors may deem
appropriate.
<PAGE>
INTERCONNECT WEST, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1995
2. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (continued)-
Estimates and Assumptions
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing the financial statements.
Loss Per Share
The computation of primary loss per share is based on the weighted average
number of shares outstanding during the period.
3. PROPERTY AND EQUIPMENT
Property and equipment consisted of the following at December 31, 1995:
Equipment $29,920
Office furniture 969
--------
30,889
Less accumulated depreciation (7,251)
$23,638
=======
Depreciation expense for the period April 21, 1995 (date of inception) to
December 31, 1995 was $4,882.
4. LONG-TERM DEBT
At December 31, 1995, long-term debt consisted of a note payable to an
individual in the amount of $30,000, with interest at 12% per annum. All accrued
and unpaid interest shall be paid on the first day of each twelve full calender
months following June 1, 1995. Thereafter, the principal amount and accrued and
unpaid interest shall be payable in 36 monthly installments of $996, payable on
the first day of each calender month beginning on July 1, 1996, and ending on
June 1, 1999, on which date all outstanding principal and accrued and unpaid
interest will be due and payable. A late charge of 5% of any late payment will
be due if payment has not been received within five days of its due date. The
note is unsecured.
<PAGE>
INTERCONNECT WEST, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1995
4. LONG-TERM DEBT (Continued)
The annual maturities of long-term debt for the next five years are as follows:
Year ending
December 31 Amount
1996 $ 4,284
1997 10,209
1998 11,619
1999 3,888
2000 -
$30,000
=======
5. COMMON STOCK
On April 21, 1995 (date of inception), the Company's primary stockholder
transferred assets and liabilities to the Company in the net amount of $4,764
(valued at the stockholder's basis) in exchange for 1,000 shares of the common
stock of the Company.
6. LEASES
The Company is obligated under one operating lease for rental of office space as
follows:
Rental expense for an operating lease for the period April 21, 1995 (date of
inception) to December 31, 1995 approximated $7,000. The Company is obligated
under the operating lease agreement to pay lease payments of $876 per month for
the period January 1, 1996 through June 30, 1996 and $924 per month for the
period July 1, 1996 through December 31, 1996. The Company may extend the lease
for one additional year by giving the landlord sixty days written notice prior
to the expiration of the lease.
<PAGE>
INTERCONNECT WEST, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1995
6. LEASES (Continued)
Future minimum lease payments under the noncancellable operating lease as of
December 31, 1995 are as follows:
Year ending
December 31 Amount
1996 $10,300
1997 -
1998 -
1999 -
2000 -
Total minimum lease payments $10,300
========
7. SUBSEQUENT EVENT
On June 17, 1996, the Company entered into an agreement with Eurotronics
Holdings Incorporated (EHI) whereby, the Company would exchange all of its
issued and outstanding shares of capital stock for 90% of the issued and
outstanding common stock of EHI which shall be issued pursuant to Rule 144 under
the Securities Act of 1933. From the date of closing, the Company will become a
wholly-owned subsidiary of EHI and the name of EHI will be changed to Access
Market Square, Inc. Both parties agree to utilize the services of Canton
Financial Services Corporation (CFSC) in connection with the Agreement. EHI and
the Company agree to issue to James Tilton (the president of EHI) 10% of the
then currently issued and outstanding common stock. The total amount of common
stock then currently issued and outstanding, including Mr. Tilton's shares, will
then be reduced to 2.5% of EHI's issued and outstanding by the issuance of 4000%
of the quantity of common stock then issued and outstanding, including 3600% to
the Company and 400% to CFSC. CFSC will also receive $100,000 payable at EHI's
option in either cash or common stock issued pursuant to Form S-8 under the
Securities Act of 1933. CFSC shall also be reimbursed for expenses incurred
during and in relation to the furtherance of this transaction.
8. LITIGATION
On February 3, 1995, Milne Jewelry Company asserted through Counsel that the
Company infringed its trade dress and copyright in and to its Internet web site
by its involvement in a so called "Santa Fe Silver Trading Post" web site. The
Company responded by denying the allegations and by taking
<PAGE>
INTERCONNECT WEST, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
December 31, 1995
8. LITIGATION (Continued)
steps to have the allegedly offending material removed. Counsel for Milne
Jewelry Company posted a letter dated February 23, 1995 continuing its
allegations. No action has been taken subsequent to that by either party.
Counsel for the Company states that no meaningful evaluation as to the range of
potential loss resulting from an unfavorable outcome can be made.
