CONFORMED SUBMISSION TYPE: 10-Q
PUBLIC DOCUMENT COUNT: 2
CONFORMED PERIOD OF REPORT: 20000137
FILED AS OF DATE: 20000315
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: TRIDON ENTERPRISES
INC
CENTRAL INDEX KEY: 0000763245
STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-
PREPACKAGED SOFTWARE [7372]
IRS NUMBER: 133183646
STATE OF INCORPORATION: CO
FISCAL YEAR END: 0430
FILING VALUES:
FORM TYPE: 10-Q
SEC ACT:
SEC FILE NUMBER: 333-72033
FILM NUMBER: 99579892
BUSINESS ADDRESS:
STREET 1: 11601 WILSHIRE BLVD.
STREET 2: STE 2040
CITY: LOS ANGELES
STATE: CA
ZIP: 90025
BUSINESS PHONE: 3107263559
FORMER COMPANY:
FORMER CONFORMED NAME: TRIDON CORP
DATE OF NAME CHANGE: 19950125
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the Quarter Ended January 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) FOR THE
SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the Transition Period From ________ to _______.
Commission File Number: 0-13628
---------------------------------
TRIDON ENTERPRISES INCORPORATED
(Exact name of registrant as specified in its charter)
Colorado 13-3183646
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
11601 Wilshire Blvd., Ste. 2040
Los Angeles, CA
90025
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code:
(310) 726-3559
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Common Shares, par value $.001 per share
Indicate by a check mark whether the Registrant (1) has filed all reports
required to be filed by section 12 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months, and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]. As of January 31, 2000,
there were 75,194,734 shares outstanding of the Registrant's common stock,
$.001 par value.
<TABLE>
TRIDON ENTERPRISES INCORPORATED
(A Company In The Development Stage)
<CAPTION>
Balance Sheets
January 31, 2000 and April 30, 1999
<S>
Assets January 31, 2000 April 30, 1999
(Unaudited) (Audited)
Current Assets: <C> <C>
Cash $ 1,453 $ 1,031
Prepaid Expense 2,310 0
Notes Receivable and Interest
Receivable 275,000 275,000
Less Allowance for Bad Debt (275,000) (275,000)
Prepaid Advertising Costs 36,000 790,560
Inventory 7,506 7,506
Loans to SLC 35,000 0
Total Current Assets 82,269 799,097
Furniture and Equipment - at Cost 25,462 25,462
Accumulated Depreciation (11,447) (9,502)
Net Furniture and Equipment 14,105 15,960
Total Assets $ 96,284 $815,057
Liabilities and Stockholders' Equity (Deficit)
Current Liabilities:
Accounts Payable and
Accrued Expenses $ 396,604 $ 342,794
Advances from Stockholder 1,536 1,536
Advances from Officers 131,578 130,578
Advances from Vertex Marketing 39,400 39,400
Total Current Liabilities 569,118 514,308
Commitments And Contingencies - -
Total Liabilities 569,118 514,308
Stockholders' Equity (Deficit):
Common Stock, $.001 Par
Value, 100,000,000 Shares
Authorized, 75,194,734 and
67,994,734 Shares Issued
and Outstanding, Respectively 75,195 67,995
Preferred Stock, 7% Cumulative
Convertible, Par Value $.001,
20,000,000 Shares Authorized,
83,300 Shares Issued , 53,300
Outstanding 53 83
Additional Paid-In Capital 12,298,184 12,030,854
Common Stock Subscribed 35,000 0
Deficit Accumulated During
Development Stage (12,881,266) (11,798,183)
------------ ------------
Total Stockholders' Equity
(Deficit) (472,834) 300,749
Total Liabilities And ------------ ------------
Stockholders' Equity (Deficit) $ 96,284 $ 815,057
============ ============
</TABLE>
<TABLE>
TRIDON ENTERPRISES INCORPORATED
(A Company In The Development Stage)
<CAPTION>
Statements Of Operations
Nine Months Nine Months
Inception to Ended Ended
January 31, 2000 January 31, 2000 January 31, 1999
<S>
Revenue: <C> <C> <C>
Net Sales $ 151,729 $ 0 $ 0
Cost of Sales 182,581 0 0
Gross Loss (30,852) 0 0
Operating Expenses:
General and Administrative 6,595,256 837,774 446,884
Research and Development 132,697 0 0
Computer Software Development Costs 630,066 0 0
Interest 869,175 9 0
Total Operating Expenses 8,227,194 837,783 446,884
Net Loss from Operations (8,258,046) (837,783) (446,884)
Other Income (Expense)
Consulting Fees Related to Common
Stock Issued (1,049,016) 0 (28,000)
Officer's Salary Related to Common
Stock Issued (1,157,328) 0 0
Interest 94,099 0 0
Casualty Loss - Boat (3,000,000) 0 0
Gain on Settlement 411,495 0 0
Forgiveness of Interest 8,901 0 0
Forgiveness of Debt 123,994 0 0
Realized gain on Disposition
of Marketable Securities 2,720 0 51,375
Loss on Permanent Impairment
of Securities (1,120,050) 0 0
Miscellaneous 4,396 0 0
Bad Debt Expense (351,422) 0 0
Litigation Settlement (654,978) (244,500) 0
--------- --------- ------
Total Other Income (Loss) (6,687,189) (244,500) 23,375
Loss from Continuing Operations Before
Income Tax Benefit (Expense) (14,945,235) (1,082,283) (423,509)
Income Tax Benefit (Expense) 81,005 (800) (800)
------------ ----------- ---------
Loss from Continuing Operations (14,864,230) (1,083,083) (424,309)
Gain on Disposal of Segment 3,836,964 0 0
Loss on Discontinued Operations (1,854,000) 0 0
------------ ----------- ----------
Net Loss $(12,881,266) $(1,083,083) $(424,309)
============= =========== ==========
Loss Per Share $ (.02) $ (.01)
=========== ==========
Weighted Average Number of Shares Outstanding 70,114,734 49,490,934
=========== ==========
</TABLE>
<TABLE>
TRIDON ENTERPRISES INCORPORATED
(A Company In The Development Stage)
<CAPTION>
Statements Of Cash Flows
Nine Months Nine Months
Inception to Ended Ended
January 31, 2000 January 31, 2000 January 31, 1999
<S>
Cash Flows from Operating Activities:
<C> <C> <C>
Net Loss $(12,881,266) $(1,083,083) $(424,309)
Adjustments to Reconcile
Net Loss to Net
Cash Used by Operations:
Loss on Disposal of
Segment (3,836,964) 0 0
Loss on Permanent Impairment
of Marketable Securities 1,120,050 0 0
Gain on Sale of Marketable
Securities (7,467) 0 (51,375)
Write-Down of Investment 25,000 0 0
Depreciation 11,614 1,946 2,212
Increase in Allowance for
Bad Debts 370,638 0 0
Professional and Management
Fees 12,885 0 54,000
Outside Services Paid by
Issuance ofCommon Stock 1,249,452 30,000 150,000
Officers' Salaries Related
to Common Stock Issued 1,697,328 0 0
Operating Expenses Paid by
Officer 110,699 0 11,694
Loan Fees Related to Common
Stock Issued 1,049,016 0 0
Write-Down of Screenplays 49,800 0 0
Loss on Fixed Asset Disposal 1,253 0 0
Research and Development 88,000 0 0
Interest Expense 349,745 0 0
Reclassification of Common
Stock Subscribed 225,000 0 0
Forgiveness of Interest (8,901) 0 0
Maritime Loss 3,462,825 0 0
Forgiveness of Debt (123,994) 0 0
Stock Issued in Litigation
Settlement 654,978 244,500 0
(Increase) Decrease in:
Inventory (7,506) 0 0
Prepaid Expenses 723,940 752,250 (6,747)
Notes Receivable (3,000) 0 0
Interest Receivable (25,000) 0 0
Increase (Decrease) in:
Accounts Payable and
Accrued Expenses 429,363 53,009 83,583
Income Tax Payable 800 800 0
Preferred Stock Subscription 10,000 0 0
</TABLE>
<TABLE>
TRIDON ENTERPRISES INCORPORATED
(A Company In The Development Stage)
<CAPTION>
Statements Of Cash Flows
(Continued)
<S>
Estimated Future Cost <C> <C> <C>
of Discontinued Operations 3,125 0 0
Accounts Payable -
Vintage Group, Inc. 45,574 0 0
------ --- ---
Net Cash Used by Operating
Activities (5,203,013) (578) (180,942)
Cash Flows From Investing Activities:
Loans Made (375,757) (35,000) 0
Investments in Marketable
Equity Securities (238,550) 0 0
Proceeds from Sale of Securities 440,743 0 107,451
Sale of Common Stock 13,550 0 0
Investment in Screenplays (40,000) 0 0
Purchase of Furniture and
Equipment (26,881) 0 0
Advances to Related Party (91,627) 0 0
Investment in Production (1,925) 0 0
Repayments of Notes Receivable 6,000 0 0
-------- -------- --------
Net Cash Provided (Used) by
Investing Activities (314,447) (35,000) 107,451
-------- -------- ---------
Cash Flows From Financing Activities:
Proceeds from Issuance of
Common Stock 4,905,325 35,000 74,623
Proceeds from Issuance of
Convertible
Preferred Stock 135,003 0 0
Increase in Paid-In Capital 99,866 0 0
Proceeds from Issuance of
Convertible Notes Payable 59,025 0 0
Advances from Officer 325,075 1,000 2,000
Repayments of Advances from
Officer (44,785) 0 (482)
Advances from Vertex Marketing 39,400 0 0
---------- ------ -------
Net Cash Provided By Financing
Activities 5,518,909 36,000 76,141
Net Increase in Cash 1,449 422 2,650
Cash at Beginning of Period 4 1,031 682
---------- ------ -------
Cash at End of Period $ 1,453 $ 1,453 $ 3,332
========== ====== =======
Tridon Enterprises Incorporated
(A Company in the Development Stage)
UNAUDITED
Notes to Consolidated Financial Statements
In the opinion of management, the accompanying unaudited financial statements
contain all the normal recurring adjustments necessary to present fairly the
financial position of the Company as of January 31, 2000, the results of its
operations for the three month periods ended January 31, 2000, and its cash
flows for the three month periods ended January 31,2000. Operating results
for the three month period ended January 31, 2000, are not necessarily
indicative of the results that may be expected for the year ended April 30,
2000.
1. Organization and Summary of Significant Accounting Policies:
Organization
Tridon Enterprises Incorporated (the Company) was incorporated in the state of
Colorado on October 7, 1983 as Turco Computer Systems, Inc. The Company
changed its name to Hammer Computer systems, Inc. on September 27, 1984. On
October 10, 1989 the shareholders voted to merge with Tridon Development
Company, HCSI being the surviving Corporation. The Articles of Incorporation
were amended to change the Company name, new directors were elected and the
Plan of Merger was approved by shareholders voting in person or by proxy. As a
result of the merger effective October 10, 1989 Hammer Computer Systems, Inc.
exchanged 600 shares of common stock in HCSI for each of the 30,000 shares of
outstanding common stock of Tridon Development Corporation. This increased the
outstanding shares of common stock in Tridon Enterprises Corporation from
17,270,433 to 35,270,433. Authorized shares of common stock remain at
100,000,000.
On October 10, 1989, Paul Ebeling was elected by the Board of Directors;
President, Chief Executive Officer & Chairman of the Board of the Corporation.
Kevin Welch was elected Secretary/Treasurer of the Corporation on February 23,
1996.
All of the assets of the Company have been presented at the lower of their cost
or estimated realizable value.
Common Shares and Earnings per Share
The computation of income per share is based on the weighted average number of
shares outstanding during each fiscal period. To calculate earnings per share,
a base of 75,194,734 shares was used for January 31, 1999 and a base of
66,094,734 was used for April 30, 1999.
2. Related Party Transactions
Vintage Group Inc., as a condition set forth in the Agreement and Plan of
Merger, canceled and forgave all debts and obligations owed Vintage by HCSI.
The Company advanced $5,000 to Vintage Group, Inc. during the quarter ending
October 31, 1994.
Beginning in September of 1991, CEO and Director, Paul Ebeling, began advancing
the Corporation funds to purchase equipment and pay for minimal office expenses
including rent for office space. In April 1995 Paul Ebeling converted $150,000
of his loan to the Company to Series A 7% cumulative convertible preferred
stock at the full offering price of $10.00 per share.
The son of Paul Ebeling, Nicholas Ebeling, purchased $2,500 of convertible
notes payable. He has converted his note into the Series A 7% cumulative
preferred stock.
The directors of the Company on September 21, 1998 authorized the conversion of
$10,845.00 of Paul Ebeling's outstanding loan to restricted (Rule 144) common
stock at par according to the terms of the loan agreement. At the same meeting
the directors authorized the conversion of the entire outstanding loan of The
Antebi Children's Insurance Trust of 1995, $3,464.00 at par according to the
terms of the loan agreement.
On December 9, 1998 the directors of the Company voted to convert $51,375.00 of
Mr. Paul Ebeling's outstanding $104,202.00 loan to the Company for 205,500
shares of North American Exploration Corporation at $.25/share. Mr. Ebeling
elected to convert that portion of his loan and took possession of 205,500
shares representing all of the shares held by the Company in North American
Exploration Corporation
On April 21, 1999, Mr. Paul Ebeling, the Chief Executive Officer and
Chairman of the Board of Directors of the Company tendered his resignation from
all positions with the Company. The resignations were accepted by the remaining
Board of Directors when tendered and the resignations became effective
immediately. Kevin Welch was nominated as interim Chief Executive
Officer and Chairman of the Board pending the election of directors at the next
annual meeting of shareholders. The resignation of Mr. Ebeling stems from
personal matters involving Mr. Ebeling that are unrelated to the Company.
However, in light of the nature of the personal issues confronting Mr. Ebeling,
the remaining Board of Directors believed it to be in the best interests of the
Company that Mr. Ebeling forthwith resign. As of April 21, 1999, Mr. Ebeling
will have no further involvement with the Company.
On June 23, 1999, Mr. Ebeling entered into a definitive written agreement with
an
unrelated third party to sell all right, title and interest in and to the Series
A Preferred Stock and Shares of Common Stock of the Company. The sale and
purchase agreement will close on July 1, 1999 at which time Mr. Ebeling will own
no further shares of stock in the Company.
3. Income Taxes
On April 30, 1987, HCSI and its subsidiary, Certified Software, had a net
operating loss carry forward, which may or may not be utilized for tax
purposes, for financial reporting purposes of approximately $4,024,000. Due to
timing differences in recording financial reporting and taxable income, HCSI
and Certified had net operating loss carry forwards available to reduce future
federal taxable income of approximately $3,914,000, expiring as follows:
Year of Expiration HCSI Certified Total
2000 118,000 357,000 475,000
2001 1,241,000 160,000 1,401,000
2002 608,000 393,000 1,001,000
Subsequent to the merger of HCSI and Tridon. Development Corporation, the
Company accumulated a loss carry forward of approximately $524,000 for federal
income tax purposes and a $259,000 tax loss carry forward for California tax
purposes. Federal net operating losses (NOL's) are carried forward fifteen
years and expire between 2004 and 2009. State NOL's are carried forward for
five years and expire between 1997 and 2000. All loss carry forward amounts
are subject to review by tax authorities.
4. Notes Receivable
Madera International Negotiable Promissory Note declared in default on June 29,
1998 and collection proceedings are being initiated for $349,997.00, including
principal, interest, late charges and interest on late charges.
5. Furniture and Equipment
Furniture and equipment is recorded at purchase cost and depreciation is
calculated over 5 years using the straight line method. For the quarter ended
January 31, 2000 there were no purchases of furniture and equipment by the
Corporation.
Item 2. Management's Discussion and Analysis.
The Board Of Directors on February 10, 1992, authorized the issuance of
convertible promissory notes to develop a suitable reliable marketable product,
and for operating capital. Notes totaling $48,000 in principle have been
issued as of December 31, 1994. Interest accrued on these notes on a monthly
basis. At January 31 1996, all notes were converted to preferred stock.
The Company is developing a process for manufacturing a hair prosthesis,
Vertex(R) and if applicable will apply for patents of its own.
The Company announced on September 21, 1993, the appointment of Harold A.
Lancer, M.D. as Medical Director. Dr. Lancer is the attending staff
dermatologist at Cedars-Sinai Medical Center in Los Angeles, the Assistant
Clinical Professor of Dermatology at U.C.L.A. Medical Center, Los Angeles, and
a fellow of the American Academy of Dermatology. A native of Montreal, Quebec,
Canada, he was educated at Brandies University, University of California at San
Diego Medical School, Harvard University Medical School, Tel Hashomen Hospital,
Israel and St. Johns Hospital for Diseases of the Skin, London, England. Dr.
Lancer has international experience in the specialities of dermatology and
cosmetic surgery. Dr. Lancer presented a paper on the Vertex to the Pacific
Dermatological Society In Monterey, California on September 10, 1994. Dr.
Lancer heads the medical and scientific team developing the Vertex and its
attendant products.
The Company contracted with California Cybernetics Corporation for the
implementation of its design, engineering, manufacturing and software
applications for its computer aided flexible manufacturing process. All
patentable aspects, including software and programming, of California
Cybernetics' work for the Company's Vertex products are the sole property of
Tridon Enterprises Incorporated. As of July 31, 1995 the Company has deposited
$98,000 with California Cybernetics Corporation for research and development.
Vertex has no base as used in normal hairpieces, but the hair appears to be
growing directly from the scalp and there is no feeling of an object on one's
head. Vertex has 100% adhesion and can remain on for approximately one month
with no special maintenance, after which it is replaced by a new one. Through
Vertex's unique locking system, human hair fibers are attached directly to
transparent and breathable synthetic skin. The material is transparent.
Substrate is also moisture vapor permeable, which means the moisture, gases and
heat (including perspiration) can exit while a one-way screen prevents bacteria
from entering. It also may reduce the effect of the sun's damaging ultraviolet
rays. Using advancements in computer robotics, the Vertex(R) can be made
consistently and less expensively than competitive products. With programmed
information about a person's skin, natural hair, age and body chemistry,
robotics manufacturing will allow an individual to obtain the Vertex(R) on
short notice, from anywhere in the world.
Management believes that it can successfully develop the non surgical Vertex
hair replacement system. The company began an 18 month comprehensive testing
program in February 1997.
On January 20, 1994, the stockholders of the Company in a special meeting
approved the issuance of 7% cumulative convertible preferred stock. On June 7,
1994, the Company issued a private placement memorandum for the offering.
Through July 31, 1995 the Company has received $188,000 for the purchase of
the preferred stock including $48,000 notes converted into preferred stock.
The proceeds of this offering was used to further develop the manufacturing
process for Vertex(R). As of January 31, 1996 the Company raised $188,000 from
this offering. The offering is closed.
In the quarter ended July 31,1994 the Company expended $31,081 on research and
development. These expenditures were used to complete the development of the
process of attaching the Vertex(R) to the scalp and documentation. This work
was done by Dr. Lancer. Total research and development costs are estimated to
be approximately $60,000 and was for the most part completed in December 1996.
An eighteen Month testing program began in February 1997 and has been completed
successfully.
On September 20, 1994, the Company engaged Robert Miles Runyan and Associates,
Marina Del Rey, CA. Runyan & Associates specializes in the field of strategic
planning and point of sale advertising, providing the Company advise and
planning on all media matters for the development and marketing of Tridon's
Vertex(R) products. This work is completed.
There have been no material changes in the operations. Tridon Enterprises
Incorporated does not have operating activity and therefore has no revenue.
For the Company to continue as a going concern it will seek an acquisition or
merger partner, place its Vertex(R) technology in a wholly-owned subsidiary and
raise the additional capital to successfully market Vertex(R).
Company management has been exploring opportunities to act as a facilities
based provider of voice and data long distance services between North America,
Asia and other territories. Management elected to form Tridon Communications
Corporation, a Nevada corporation, and received a license from the Federal
Communications Commission (FCC) to become a resale common carrier under the
Communications Act of 1934 as amended by the Telecommunications Act of 1996.
On March 23, 1999 the Company obtained an injunction preventing the transfer
and sale of Vanity A.V.V. (Aruba) Investment Bankers' 1,000,000 share
certificate and is proceeding to cancel the certificate and return the shares
to the Company treasury. On August 20, 1999, the Company dismissed any legal
proceedings against Vanity A.V.V. (Aruba) Investment Bankers. The injunction
against the 1,000,000 share certificate was lifted and the stock was
transferred.
The Company was recently served with a complaint filed by Coldwater
Capital, LLC ("CCL") in the Superior Court for the State of California, bearing
case number SC057089, in which the CCL is seeking both compensatory and punitive
damages in excess of ten million dollars ($10,000,000.00). The complaint alleges
that the Company offered to sell two million (2,000,000) shares of its common
stock to CCL in exchange for consideration of ten thousand dollars ($10,000.00).
The Company believes that the complaint filed by CCL is without merit and the
Company is prepared to defend the action. At this point, the Company has filed
an answer to the Complaint and the case is proceeding forward. On September 9,
1999, the Company executed a settlement and release agreement with Coldwater
Capital. Under the terms of the settlement, the Company obtained a dismissal
of the law suit and issued Coldwater Capital, LLC two million (2,000,000)
common shares.
In 1989, the Company was sued by Lucas Plaza Associates ("LPA") in the
Circuit Court for the State of Missouri, bearing case number 902-2217. LPA has
alleged that the Company is in breach of contract for lease obligations on
property located in St. Louis, Missouri. While the case lay dormant for many
years, LPA has recently begun the prosecution of the case and the Company is
defending the action. The complaint filed by LPA is seeking both compensatory
and punitive damages of one hundred ninety six thousand six hundred dollars
($196,600). The Company was informed that LPA obtained a judgment against the
Company in the amount of $196,600 by way of a motion for summary judgment filed
by LPA. On December 23, 1999 the Company obtained a settlement and full
release with LPA for three million (3,000,000) restricted common shares.
In 1989, the Company was sued by James Kujawa ("JK") in the Circuit Court
for the State of Missouri, bearing case number 902-02138. JK has alleged that
the Company is indebted to JK for performance of labor and materials supplied
for buildout of leased property space located in St. Louis, Missouri. While the
case lay dormant for many years, JK has recently begun the prosecution of the
case and the Company is defending the action. The complaint filed by JK is
seeking both compensatory and punitive damages of one hundred sixty two thousand
nine hundred twenty-two dollars ($162,922). The Company was informed that JK
obtained a judgment against the Company in the amount of $162,922 by way of a
motion for summary judgment filed by JK. The Company will attempt to negotiate
a settlement with the plaintiff, if a settlement is possible.
The Company had previously announced that it had entered into two (2)
resale agreements with IMEX Communications Corporation and TelNet, LLC,
respectively. One of the agreements, executed on April 6, 1999, required the
Company to provide international long distance minutes to TelNet, LLC to the
following countries: India, Nigeria and Pakistan. The contract with TelNet LLC
would have generated a minimum revenue base of $8.5 million monthly to the
Company. In order to provide the international long distance minutes to TelNet,
LLC, the Company entered into an agreement with IMEX Communications, Inc., on
April 5, 1999 which was to provide the Company with the ability to provide
international long distance services to over 100 countries including India,
Pakistan, and Nigeria. IMEX Communications, Inc. defaulted on its obligation to
provide the Company with a schedule of minutes and rates as per its contractual
requirements and, therefore, prevented the Company from fulfilling its
obligations to TelNet, LLC. The Telnet, LLC agreement expired on April 21,
1999. A letter from TelNet, LLC to the Company dated April 22, 1999, indicates
that TelNet desires to continue a relationship with the Company should the
Company be able to provide competitive international long distance rates.
Current management is reviewing with its counsel the right to bring legal action
against IMEX Communications for damages in an amount to be determined. At this
time, the Company has not instituted any litigation in connection with these
matters.
The Company announced the execution of a definitive agreement to
form a joint venture with IUSACELL Philippines to provide circuit capacity to
the Company. Current management has discovered that the agreement between the
parties was a verbal agreement and has decided to postpone any further
discussions.
The Company has announced the spin-off of Vertex Corporation, a
wholly-owned subsidiary, to its shareholders. The spin-off is part of the
planned reorganization of the Company and has formed a part of the negotiations
that the Company is having with other telecommunications companies in the hopes
of effectuating a reorganization or acquisition. The spin-off will only occur
if the Company is able to transact a merger or consolidation with another entity
that can further the interests of the Company and its shareholders. The Company
makes no warranty as to the success or failure of Vertex Corporation, or if
there will be management in place to develop a market for Vertex hair products.
On August 2, 1999, Tridon Enterprises, Inc. (the "Company") entered into
an agreement of reorganization with Satellite Link Communications, Inc., a
California Corporation, pursuant to which ("SLC") will be acquired by the
Company in accordance with the laws of the State of Incorporation of the
Company and in full compliance with the requirements of Section 368(a)(1)(B) of
the Internal Revenue Code of 1986, as amended (the "IRC"). The acquisition
will result in SLC becoming a wholly-owned subsidiary if the Company. The
assets of SLC are composed of telecommunications related Termination
Agreements, Private Line Agreements, Minute Purchase Agreements, Time Marketing
Agreements and Sales Agreements.
To accomplish the acquisition, the Company intends to issue shares of its
voting common stock to the shareholders of SLC in exchange of all of the issued
and outstanding shares of common stock of SLC. SLC shall receive that number
of shares of common stock of the Company following the merger that will result
in SLC owning ninety five percent (95%) of the issued and outstanding shares of
the Company following the acquisition.
The Reorganization Agreement requires that the Company cause a 1 for 40
reverse stock split to occur prior to the Closing and that the Shareholders
approve the same at the next annual meeting which is scheduled for May 11,
2000. To that end, the company is presently preparing in proxy statement for
delivery to shareholders of record following receipt of approval of the same
from the Commission. Following the acquisition, the Company shall have forty
million shares of common stock outstanding of which two million shall be owned
by shareholders of record as of the date of the receipt of shareholder approval
of the proposed acquisition.
Following the completion of the acquisition, SLC shall become a wholly-
owned subsidiary the Company and SLC shall continue to operate as a separate
legal entity. Following the consummation of the acquisition, the Officers and
the Directors of the Company shall be reconstituted and those individuals not
remaining shall resign and shall tender their written resignations to the
Company. Following the receipt of shareholder approval of the acquisition, the
shareholders of the Company shall elect a new board of directors. This is
scheduled for the next shareholder meeting and shall be included in the proxy
materials the Company on file with the Commission.
The Company and SLC will each be required to provide appropriate opinions
of counsel with respect to the acquisition and the transfers contemplated in
connection therewith. To that end, counsel to the Company and counsel to SLC
have prepared a definitive agreement which was executed by the Company and SLC
on August 2, 1999.
The Company anticipates the completion of the acquisition with SLC to be
completed on or before May 11, 2000. However, both the Company and SLC have
agreed that this date may be extended by mutual consent of parties.
PART II-OTHER INFORMATION
Items 1 through 3. No response required.
Item 4. Submission of Matters to a Vote of Security Holders.
On October 10, 1989, a special meeting of the shareholders of Hammer Computer
Systems, Inc. (HCSI), a Colorado Corporation incorporated in 1983, was held to
approve the Agreement and Plan of Merger, signed on February, 1989, to merge
HCSI with Tridon Development Corporation, a Missouri Corporation organized in
1988. In connection with the proposed merger, all the then existing officers
and directors of HCSI tendered their resignations. The shareholders, voting in
person or by proxy, (a) approved the merger of Tridon Development Corporation
into Hammer computer Systems, Inc. (b) elected three new Directors, Paul
Ebeling, Harold Antoine, and Frances Schmoker, to the Board of Directors, and
(c)approved an amendment to the articles of incorporation to change the name of
the Company from Hammer Computer Systems, Inc. to Tridon Corporation.
On January 20, 1994, the stockholders of the Company in a special meeting
approved a $1,000,000 offering of 7% cumulative convertible preferred stock.
On June 7, 1994, the Company issued a private placement memorandum for the
offering. To January 31, 1996, the Company has received $140,000 for the sale
of preferred stock and an additional $48,000 of notes payable have been
converted into preferred stock. Paul Ebeling, Company CEO, has converted
$150,000 of his loan to the company to 15,000 shares of convertible preferred
stock at $10.00 per share, the offering price.
On February 22, 1996, the stockholders of the Company approved an amendment to
the Company's Articles of Incorporation: that the officers and directors of the
Company liability be limited to the full extent as provided for in Colorado
Corporations Code, Section 7, Article 9, as amended. The stockholders voted to
amend the Articles of Incorporation to change the name of the Corporation to
Tridon Enterprises Incorporated and to split the shares of the company one for
ten. The stockholders voted to form a wholly-owned subsidiary for the
continuing development of Vertex(R). Vertex Corporation, a Nevada corporation,
was incorporated on February 25, 1997 as a subsidiary. On March 9, 1999 the
Company incorporated Tridon Communications Corporation, a Nevada corporation,
as a subsidiary.
On August 2, 1999 the Company entered into a "Plan of Reorganization" with
Satellite Link Communications Corporation (SLC). The agreement calls for the
Company to do a reverse stock split and exchange its stock for the stock of
SLC. SLC will become a subsidiary of Tridon Enterprises. The reorganization
requires shareholder approval so the Company has prepared a proxy statement
which has been filed for approval with the Securities and Exchange Commission.
Item 5. Exhibits and Reports of Form 8-K.
Reports on Form 8-K dated August 10, 1999
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRIDON ENTERPRISES INCORPORATED
Registrant
Date: March 18, 2000 /s/ Kevin Welch
Kevin Welch, CEO and Director
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