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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15 (d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 12, 1998
HOWTEK, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-9341 02-0377419
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or organization) File Number) Identification No.)
21 Park Avenue, Hudson, New Hampshire 03051
(Address of principal executive offices) (Zip Code)
(603) 882-5200
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
<PAGE>
Item 5. Other Events
During April and May of 1998, Howtek, Inc. (the "Company") borrowed, (i)
$200,000 from Mr. Robert Howard, the Company's Chairman of the board of the
Company, and (ii) $100,000 from Dr. Lawrence Howard, the son of Mr. Robert
Howard, pursuant to Secured Demand Notes and Security Agreements.
In May, 1998, the Company consummated an agreement with the Chairman of the
Board of the Company to convert Company indebtedness of $400,000, owed to the
Chairman, into 400,000 shares of restricted Common Stock, par value $.01 per
share (the "Common Stock").
In May, 1998, the Company consummated an agreement with the son of the
Chairman of the Board of the Company to convert Company indebtedness of $300,000
into 300,000 shares of restricted Common Stock.
In May, 1998, the Company consummated a private offering of 1,000,000
shares of Common Stock for gross proceeds of $1,000,000.
The unaudited pro forma balance sheet as of March 31, 1998 presented below
in this Item 5 illustrates the effects of the foregoing transactions on the
Company's balance sheet for the period presented, as if the foregoing
transactions had taken place on March 31, 1998.
The unaudited pro forma financial statement is presented for illustrative
purposes only, is not necessarily indicative of the results that would have
occurred or of future results, and should be read in conjunction with the
Company's financial statements.
2
<PAGE>
HOWTEK, INC.
Balance Sheets
March 31, 1998
<TABLE>
<CAPTION>
Historical Pro Forma Pro Forma
Statements Adjustments(I)(II) As Adjusted
------------ ------------------- ------------
Assets (unaudited)
<S> <C> <C> <C>
Current assets:
Cash and equivalents $ 228,043 $ 1,300,000 $ 1,528,043
Accounts receivable:
Trade-net of allowance for doubtful accounts
of $79,272 in 1998 and $70,000 in 1997 963,769 963,769
Inventory 3,448,009 3,448,009
Prepaid and other 188,051 188,051
------------ ------------ ------------
Total current assets 4,827,872 1,300,000 6,127,872
------------ ------------ ------------
Property and equipment:
Equipment 2,297,519 2,297,519
Motor vehicles 6,050 6,050
------------ ------------ ------------
2,303,569 0 2,303,569
Less accumulated depreciation and amortization 1,361,521 1,361,521
------------ ------------ ------------
Net property and equipment 942,048 0 942,048
------------ ------------ ------------
Other assets:
Software development costs, net 590,394 590,394
Debt issuance costs, net 72,950 72,950
Patents, net 24,952 24,952
------------ ------------ ------------
Total other assets 688,296 0 688,296
------------ ------------ ------------
Total assets $ 6,458,216 $ 1,300,000 $ 7,758,216
============ ============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 1,198,748 $ $ 1,198,748
Accrued interest 68,342 68,342
Accrued expenses 313,236 313,236
------------ ------------ ------------
Total current liabilities 1,580,326 0 1,580,326
Loan payable to principal stockholders 400,000 300,000 700,000
Repayment of loan payable to principal stockholders -- (700,000) (700,000)
Convertible subordinated debentures 2,181,000 2,181,000
------------ ------------ ------------
Total liabilities 4,161,326 (400,000) 3,761,326
============ ============ ============
Commitments and contingencies
Stockholders' equity:
Common stock, $ .01 par value: authorized
25,000,000 shares; issued 9,128,082 in 1998
and 9,128,082 shares in 1997; outstanding
9,060,206 in 1998 and 9,060,206 shares in 1997 91,281 17,000 108,281
Additional paid-in capital 45,665,122 1,683,000 47,348,122
Accumulated deficit (42,509,249) (42,509,249)
Treasury stock at cost (67,876 shares) (950,264) (950,264)
------------ ------------ ------------
Stockholders' equity 2,296,890 1,700,000 3,996,890
------------ ------------ ------------
Total liabilities and stockholders' equity $ 6,458,216 $ 1,300,000 $ 7,758,216
============ ============ ============
</TABLE>
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<PAGE>
NOTES TO PRO FORMA FINANCIAL STATEMENTS
I. Extinguishment of Debt Adjustment
The pro forma adjustment to the balance sheet is as follows:
Extinguishment of Debt
To record the conversion of indebtedness of $700,000 to 700,000 shares of Common
Stock at $1.00 per share, resulting in the extinguishment of $700,000 of debt
and the elimination of corresponding liability.
Debit Credit
----- ------
Loan payable to principal stockholders $700,000
Common Stock $ 7,000
Additional Paid-In Capital $ 693,000
II. Offering Adjustment
The pro forma adjustment to the balance sheet is as follows:
Private Placement Offering
To record the sale of 1,000,000 shares of Common Stock at $1.00 per share.
Debit Credit
----- ------
Cash $1,000,000
Common stock $ 10,000
Additional Paid-In Capital $ 990,000
4
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Howtek, Inc.
(Company)
Date: June 16, 1998 By: /s/ W. Scott Parr
-----------------------------------
W. Scott Parr
President, Chief Executive Officer,
Director
Date: June 16, 1998 By: /s/ Robert J. Lungo
------------------------------------
Robert J. Lungo
Vice President Finance,
Chief Financial Officer
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