UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended: September 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Transition Period From ____ to ____
---------------------------------------------
Commission File Number: 2-95626-D
SIONIX CORPORATION
---------------------------------------------------
(Exact name of Registrant as specified in its charter)
UTAH 87-0428526
----------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
5405 Morehouse Drive, Suite 200, San Diego, California 92121
------------------------------------------------------ ---------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (619) 622-0200
Securities Registrant pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part II of this Form 10-K or any amendments to this
Form 10-K.
The aggregate market value of the voting stock held by nonaffiliates of the
registrant, based upon the closing price on September 30, 1996 was approximately
$12,800,000. [ ]
The number of shares outstanding of the registrant's common stock as of
September 30, 1996 was 23,599,696.
<PAGE>
SIONIX CORPORATION
FORM 10-K
For The Fiscal Year Ended September 30, 1995
INDEX
Page
PART I
Item 1. Business ........................................................ 1
Item 2. Properties ...................................................... 4
Item 3. Legal Proceedings ............................................... 4
Item 4. Submission of Matters to a Vote of Security Holders ............. 4
PART II
Item 5. Market for the Registrant's Common Equity and Related
Stockholder Matters .............................................. 5
Item 6. Selected Financial Data .......................................... 5
Item 7. Management Discussion and Analysis of Financial Condition and
Results of Operations ........................................... 5
Item 8. Financial Statements and Supplementary Data ...................... 6
Item 9. Disagreements on Accounting and Financial Disclosures ............ 6
PART III
Item 10. Directors and Executive Officers of the Registrant .............. 22
Item 11. Executive Compensation .......................................... 23
Item 12. Security Ownership of Certain Beneficial Owners and Management .. 24
Item 13. Certain Relationships and Related Transactions .................. 24
PART IV
Item 14. Exhibits, Financial Statements, Schedules and Reports
on Form 8-K ..................................................... 25
Signatures .............................................................. 26
i
<PAGE>
PART I
Item 1. THE BUSINESS
General
Sionix Corporation, formerly Coronado Capital Corporation (hereinafter
referred to as "Sionix" or the "Company") was incorporated under the laws of the
State of Utah on January 15, 1985, as a "blind pool", with no specific business,
for the purpose of raising capital to purchase various business endeavors.
Coronado Capital held a public offering of stock in August 1985. The net
proceeds were invested into what became a number of unsuccessful ventures and
Coronado Capital became relatively inactive by 1988. In February 1994, Coronado
Capital merged with Alimet, Inc., a Delaware corporation. Alimet, Inc. was
researching and manufacturing aluminum-based metal matrix composite alloys for
the use in non-aerospace applications. By late 1994, Coronado Capital determined
that the financial requirement to produce and market these new metals was far
beyond Coronado Capital's means and Coronado Capital took a one time charge for
research and manufacturing costs.
During fiscal 1995, the Company entered into an Acquisition Agreement and
Plan of Reverse Merger with Automatic Control Corporation, a Nevada Corporation
("ACC"), under which ACC would merge with and into the Company (the "Merger").
On December 28, 1995, the merger was approved by the shareholders of the Company
and the merger was consummated and effective as of January 5, 1996. The newly
merged company was renamed Sionix Corporation at a special meeting of the
shareholders held on January 23, 1996.
The Company has designed, patented, manufactures and markets computer
software and hardware for automation and optimization of water monitoring and
filtration for public water treatment facilities and industrial processes.
The Company's executive offices and principal operations are located at
5405 Morehouse Drive, Suite 200, San Diego, California 92121 and its telephone
number is (619) 622-0200.
Products
The Company's principal product categories are:
1. Software programs to simplify many common office tasks unique to the
water treatment industry.
2. A Supervisory Control and Data Acquisition ("SCADA") hardware package
with computer driven controllers that automate any mechanical or electrical
plant operation with redundant fail-safe computer hardware networked with
intelligent PLC's (programmable logic controls) and RTU's (remote terminal
units), and
3. A multi-patented modular and portable filtration systems technology that
meets all United States Environmental Protection Agency (USEPA) regulations for
the treatment of surface water and secondary waste water.
Sionix5 Office Automation and Training Program
The user friendly software program, contains an extensive library of state
and federal clean water laws and acts, a plant operator training program, an
automatic health department report compiler, and a Safety, Health and
Environmental Affairs ("SHEA") compliance program. It can be purchased
separately and installed on a 486 IBM compatible computer with the Microsoft
Windows 95 or Windows NT operating system. The Company's Sionix5 CD-ROM includes
EPA rules and regulations, material data safety sheets, write-ups on the latest
treatment processes, maintenance
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manuals for water-treatment systems, and a Glossary of essential (but sometimes
unfamiliar) water-industry terms and expressions.
The Sionix5 Reference Library features Microsoft's user-friendly format for
online Help. Users are offered three different paths into the Library: Contents,
Index and Find. Each path uses a different approach to answer any questions that
an operator has in mind.
Sionix5 includes the first Instant Safety Program for utilities and
businesses. It covers all basic features in any commercial or industrial
workplace. Its Safety Audit identifies applicable sections of safety, health and
environmental affairs law that operators must observe.
Sionix SCADA System and Sionix5 SCADA Manager
The Company packages its affordable Sionix SCADA Manager software with OPTO
22 equipment, which was developed by industry leaders over the past 25 years.
This rugged SCADA equipment is frequently specified by leading industrial plant
design engineers nationwide. An important feature in all Sionix SCADA system
designs is redundancy, in this case, a second computer network processor server,
as a backup. Easy-to-install Sionix RTU's reduce on-site labor costs. They
feature convenient plug-in connectors for easy top-mounted field wiring and
access to standard fuses. Quick and easy installation modules "snap" securely on
racks. No screws are required. For any control application, flexible RTU's, with
single distributed I/O drivers, analyze all data received from analog, digital
or mixed I/O driver modules.
The Company's in-line wet-chemistry modules monitor temperature, total
dissolved solids (TDS), pH, and oxidation reduction potential (ORP, or Redox) in
one compact sensor array. Most manufacturers ordinary inline sensors are
installed separately. ORP monitors provide a vital early warning if source water
quality suddenly changes. Particle counters, chlorine or turbidity monitors, and
other inline sensors can be added to the network at any time. The compact Sionix
sensor array can be opened, cleaned and calibrated in minutes. Inexpensive ORP
sensors, which should be replaced every six months, can be changed in minutes. A
combined standard testing fluid calibrates all sensors in the array at the same
time.
The Sionix SCADA Manager efficiently monitors and controls a number of
water quality parameters. It is designed with a flexible, open architecture that
is easily expandable. A monitoring station may be linked to a number of
programmable logic controllers (PLC's) or remote terminal units (RTUs), each
consisting of multiple inputs or outputs. The program's consolidated strip
charts display a wide variety of water quality parameters. This is a powerful
tool that helps management meet present and future requirements in water
monitoring and process control. This real-time, multitasking control program
allows an operator to run 30 charts simultaneously. Logical instructions contain
plain English commands and mathematical functions. A strategy Tree provides a
graphical view of the entire SCADA network. Users simply point and click to
display any item of interest. This advanced software and state-of-the-art
automation equipment operates in Microsoft's Windows NT and Windows 95
environments. The entire system is virtually self-documenting and easily
expandable. When combined with the report compiler of the Sionix5 software
package, all data flow from the SCADA system is stored to create most monthly
health department reports automatically.
Sionix Filtration Modules
The Company has received five U.S. patents on it filtration technology.
Each patented Sionix Filtration Module includes a dissolved air flotation (DAF)
particle separator with corona-discharge ozone generator, a double-helix ozone
mixing chamber, two 2-micron filter elements able to remove chlorine-resistant
microbacteria, and the Sionix SCADA Manager software program. The DAF buoyant
particle separators use microscopic air bubbles to remove suspended particles in
the
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water. A vertical vortex column of spinning water forms a high-pressure zone at
the outer perimeter, and a low-pressure vortex of trapped air in its center.
Algae, oils and other buoyant particles are pushed by the microscopic air
bubbles into the center. The contaminants are held there by surface tension at
the vortex's air-water interface and slowly discharged along with excess air and
water to the waste line. The Company's DAF process uses no polymer chemicals or
toxic metals. Wastewater can be safely returned to a lake, river, or reservoir
without damaging the environment. DAF particle separators substantially improve
filter efficiency. This chemical-free process also extends the time between
filter cleaning cycles.
The Company's two 2-micron filter elements more effectively stop
Cryptosporidium oocyst parasites. Automatic cleaning cycles use less water than
conventional sand filters. Woven stainless steel filter media produce minimum
differential pressure drops, and are cleaned when the differential pressure
increases 3 psi. Lower operating pressures require less energy.
Each basic module filters 200 GPM, or 288,000 gallons per day, to supply
all the drinking and potable water requirements for 2,400 people. Additional
Sionix Filtration Modules can be added to supply larger communities. Additional
filtration modules or remote Sionix SCADA terminal units can be installed as a
complete package system, or in easily affordable stages over an extended period
of time. The Company's low cost leasing program enables public water districts
to acquire more efficient, cost-effective equipment, and actually reduce
operating costs.
Availability of Materials
Materials and components use by the Company for manufacturing are carefully
selected based on stringent specifications for usage and operating conditions.
Every effort is made to specify parts from multiple sources for independence
from manufactures and distributors. The Company has avoided using hard-to-get
special parts to further minimize dependency from vendors. Simplicity in design
and the use of common, widely used and readily available components in the
electronic industry is emphasized.
Marketing and Customers
Internationally, the total replacement value of the municipal
filtration-equipment market in 24 of the largest countries exceeds $5.6
trillion. Domestically, the immediate market exceeds $20 billion by EPA
estimate.
The drinking and waste water markets can be divided into six categories:
municipal water delivery; municipal waste effluent, industrial in-process;
industrial waste effluent; landfill waste leachate; and ground water
remediation. The Company is initially targeting the first four, as they
represent the largest immediate markets. Public water districts providing
drinking water or sewage treatment services are potential customers for the
Company, along with commercial and industrial clients that create and dispose of
contaminated wastewater. An established base of 185,000 small municipal water
providers are an ideal target market group for the company's equipment and
services. This is clearly the group with the greatest need: most of them now
operate outdated, inefficient and expensive systems. Many of these
municipalities are in violation of current laws.
EPA reports list over 50,000 American cities currently in violation of the
Safe Drinking Water Act. Sweeping regulation is underway that will dramatically
increase that number as new rules come into effect and more communities expand
testing for exotic chemicals. Municipalities primary barrier to upgrading is
cost. Small rural water districts cannot afford newer technology capable of
meeting the new Safe Drinking Water Act standards.
The company's new patented filtration technology dramatically reduces the
cost of water produced. The systems most commonly used by municipalities, slow
sand filters or sand-anthracite
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filter beds, are more expensive to build, and are unable to meet new EPA
standards without massive amounts of expensive chemical filter aids. Membrane
filter systems able to meet EPA standards are twice as expensive. In comparison,
the Company's 200-GPM system, which includes automatic self-cleaning, a
wet-chemistry monitoring system and ozone treatment, costs half the price of
these inefficient, slow sand filters.
A 1995 World Bank report prepared for an international symposium in
Stockholm expects "world expenditures of $600 billion over the next decade to
augment water reserves as demand spurred by urbanization and agriculture
outstrips available supplies." The municipal water treatment industry has a long
history of sustained growth and fiscal responsibility. The Company has released
it's Sionix5 Office Automation and Training Program software in October 1996 and
plans to begin marketing the Sionix SCADA System and Sionix5 SCADA Manager
before the end of the year. The Sionix Filtration Module is schedule for release
in the first quarter of 1997. Management is also currently establishing U.S. and
international distributors to maximize market share and insure rapid Company
growth during this window of opportunity.
Employees
At September 30, 1996 the Registrant had 12 full time employees.
ITEM 2. PROPERTIES
At September 30, 1996 the Registrant did not own property. The Registrant
leases approximately 7,949 square feet of office facilities in San Diego at a
monthly rent of $8,505.
ITEM 3. LEGAL PROCEEDINGS
The Company is a defendant in a lawsuit in San Diego County Superior Court
filed by ex-employee and the interim president, Michael Maung. Mr. Maung alleges
that the Company breached his employment contract and personally defamed him.
The Company has filed its cross claims and intends to vigorously defend the
lawsuit. The ultimate outcome of the case is uncertain but management believes
an unfavorable outcome is unlikely.
With the exception of the above-referenced matter, the Company is not a
party to any material legal proceedings, nor to the Company's knowledge are
there any other material legal proceedings contemplated against it.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the first and final quarter of fiscal 1996, there were two matters
submitted to a vote of the security holders of the registrant. The first was a
special meeting of the shareholders held on January 23, 1996, for the purpose of
changing the name of the registrant from Sionix Corporation and to amend the
Articles of Incorporation to provide that action by written consent of its
shareholders may be taken without a meeting in accordance with Section 1-10a-704
of the Utah Revised Business Corporation Act. Both proposals were approved and
adopted.
The second matter was the action by written consent of a majority of the
shareholders taken on September 16, 1996, wherein Section 2.4 of the By-laws of
the registrant was amended to provide that a special meeting of the shareholders
may be called by the president of the corporation, a majority of the board of
directors or by the written request of shareholders holding at least ten (10)
percent of all votes entitled to be cast on such issue to be proposed at such
special meeting.
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<PAGE>
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS
Market for Common Stock
The Company's common stock is listed and traded on the NASDAQ OTC Bulletin
Board under the symbol SINX. There has been relatively limited trading activity
in the Company's stock since inception. The following table represents the high
and low sales prices for the Company's common stock for each quarter of fiscal
1996.
<TABLE>
<CAPTION>
Fiscal 1996 Asked Bid
--------------- ------ -------
<S> <C> <C>
First Quarter $ 2.00 $ 2.00
Second Quarter $ 1.50 $ 1.25
Third Quarter $ 1.12 $ 1.06
</TABLE>
Holders of Record
There were approximately 500 holders of record of the Company's common
stock as of September 30, 1996.
Dividends
The Company has never declared or paid any cash dividend on its shares of
common stock. Future dividends, if any, will vary depending on the Company's
profitability and anticipated capital requirements.
ITEM 6. SELECTED FINANCIAL DATA
Financial Highlights
<TABLE>
<CAPTION>
Year Ended December 31 (September 30 for 1996)
----------------------------------------------
1994 1995 1996
-------- ------- ------
<S> <C> <C> <C>
Net Revenues ............... $ - $ - $ -
Net Income ................. (1,521) (914,279) (922,717)
Earnings per share ......... - (0.05) (0.04)
Return on net revenues...... - - -
Cash and short-term investments - 229,407 36,041
Total assets................ 1,521 1,602,593 1,404,340
Stockholders' equity........ - 1,468,903 1,136,000
</TABLE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Company's balance sheet as of September 30, 1996 continues to reflect
negative working capital. This was due to a delay in the release of the beta
version of the Sionix5 Office Automation and Training Program until October
1996. The Company received financial support by way of a private placement that
raised approximately $519,500 since May, 1996. Included in this amount is
$142,500 from the Company's top management." These funds allowed the
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Company to create its initial inventory of product for sale and to ramp up its
marketing department.
Results of Operations
The Board of Directors approved a change in the fiscal year end of the
Company from December 31 to September 30, effective with the current quarter, on
September 27, 1996. For the quarter ended September 30, 1996 the Company is
reporting a loss of $287,000, or $0.01 per share. This compares with a loss of
$283,000, or $0.01 for the previous quarter ended June 30, 1996 and a loss of
$352,000, or $0.02 per share, for the quarter ended September 30, 1995. There
were no revenues reported for the quarter ended September 30, 1996.
For the short year ended September 30, 1996 the Company is reporting a loss
of $923,000, or $0.04 per share. This compares with a loss of $516,000, or $0.02
per share for the nine months ended September 30, 1995.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Index to Financial Statements
Page
----
Balance Sheets - September 30, 1996 ................................... 7
Statement of Operations................................................ 9
Statement of Stockholders' Equity...................................... 10
Statement of Cash Flows - periods ended September 30, 1996............. 12
Notes to Financial Statements for Period............................... 14
Independent Auditor's Report .......................................... 21
All other schedules are not submitted because they are not applicable or
not required or because the information is included in the financial statements
or notes thereto.
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
None.
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<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Balance Sheet
<TABLE>
<CAPTION>
ASSETS
September 30,
1996
-------------
<S> <C>
CURRENT ASSETS
Cash in banks $ 36,041
Inventory (Note 2) 40,333
Prepaid expenses 2,981
------------
Total Current Assets 79,355
PROPERTY AND EQUIPMENT - NET (Notes 2 and 3) 107,367
------------
OTHER ASSETS
Intangibles - net (Notes 2 and 4) 1,210,622
Deposits 6,996
------------
Total Other Assets 1,217,618
------------
TOTAL ASSETS $ 1,404,340
=============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Balance Sheet (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
September 30,
1996
-------------
<S> <C>
CURRENT LIABILITIES
Loan payable (Note 5) $ 50,000
Lease payable, current portion (Note 6) 7,847
Accrued expenses 112,272
-------------
Total Current Liabilities 170,119
-------------
LONG-TERM DEBTS
Lease payable (Note 6) 16,021
Related party payables (Note7) 72,200
Convertible debenture (Note 8) 10,000
-------------
Total Long-Term Debts 98,221
-------------
Total Liabilities 268,340
-------------
COMMITMENTS AND CONTINGENCIES (Notes 6 and 12) -
-------------
STOCKHOLDERS' EQUITY
Common stock $.001 par value,
100,000,000 shares authorized,
23,599,696 shares issued and outstanding 23,600
Additional paid-in capital 5,282,717
Deficit accumulated during the development stage (1,838,517)
Subscription receivable (Note 10) (2,331,800)
--------------
Total Stockholders' Equity 1,136,000
--------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,404,340
==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 8
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Statements of Operations
<TABLE>
<CAPTION>
From
Inception on
For the Nine For the October 3 ,
Months Ended Year Ended 1994 Through
September 30, December 31, September 30,
1996 1995 1996
------------- ------------ -------------
<S> <C> <C> <C>
REVENUE $ - $ - $ -
------------- ------------ -------------
EXPENSES
Research and development 328,174 515,478 843,652
Depreciation and amortization 82,551 77,405 159,956
Administrative and marketing 501,480 303,762 806,763
------------- ------------ -------------
Total Expenses 912,205 896,645 1,810,371
------------- ------------ -------------
(LOSS) FROM OPERATIONS (912,205) (896,645) (1,810,371)
------------- ------------ -------------
OTHER INCOME (EXPENSE)
Interest (10,512) (17,634) (28,146)
Total Other Income (Expense) (10,512) (17,634) (28,146)
------------- ------------ -------------
NET LOSS $ (922,717) $ (914,279) $ (1,838,517)
============= ============= ==============
NET LOSS PER SHARE $ (0.04) $ (0.05)
============== =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
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<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity
From Inception on October 3, 1994 through September 30, 1996
<TABLE>
<CAPTION>
Additional
Common Stock Paid-In Accumulated Subscription
Shares Amount Capital Deficit Receivable
-------- ------- -------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Balance
October 3, 1994 - $ - $ - $ - $ -
Shares issued to initial
stockholders in October
1994 at $0.01
per share 10,000 10 90 - -
Net loss from October 3,
1994 through December
31, 1994 - - - (1,521) -
-------- ------- -------- --------- ----------
Balance
December 31, 1994 10,000 10 90 (1,521) -
Issuance of Common
stock for assignment
of rights recorded at
predecessor cost
at $0.00
per share 1,990,000 1,990 (1,990) - -
Issuance of Common
stock for services
at $0.25
per share 572,473 572 135,046 - -
Issuance of Common
stock for debt
at $0.25
per share 188,561 188 47,347 - -
Issuance of Common
stock for debt
at $0.50
per share 595,860 596 297,334 - -
Issuance of Common
stock for debt
at $2.00
per share 98,194 98 196,290 - -
Issuance of Common
stock for debt
at $4.00
per share 156,025 156 623,944 - -
-------- ------- -------- --------- ----------
Balance Forward 3,611,113 3,610 1,298,061 (1,521) -
--------- ------- --------- --------- ----------
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 10
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Statements of Stockholders' Equity (Continued)
From Inception on October 3, 1994 through September 30, 1996
<TABLE>
<CAPTION>
Additional
Common Stock Paid-In Accumulated Subscription
Shares Amount Capital Deficit Receivable
-------- ------- -------- ---------- -----------
<S> <C> <C> <C> <C> <C>
Balance Forward 3,611,113 3,610 1,298,061 (1,521) -
--------- ------- --------- --------- ----------
Issuance of Common
stock for cash at
$4.00 per share 138,040 138 552,022 - -
Issuance of Common
stock for subscription
note receivable at
$4.00 per share 414,200 414 1,652,658 - (1,656,800)
Issuance of Common
stock for future
production costs
at $6.00
per share 112,500 113 647,887 - (676,000)
Issuance of Common
stock for cash
at $6.00
per share 94,517 95 567,005 - -
Net loss for
the year ended
December 31, 1995 - - - (914,279) -
--------- ------- --------- --------- ----------
Balance December
31, 1995 4,370,370 4,370 4,744,633 (915,800) (2,331,800)
Issuance of Common
stock in
reorganization 18,632,612 18,633 (58,033) - -
Issuance of Common
stock for cash
at $1.00
per share 572,407 573 571,834 - -
Issuance of Common
stock for service
at $1.00
per share 524,307 24 24,283 - -
Net loss for the
nine months ended
September
30, 1996 - - - (922,717) -
--------- ------- --------- --------- ----------
Balance September
30, 1996 23,599,696 $23,600 $5,282,717 $(1,838,517) $(2,331,800)
========== ======= ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 11
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Statements of Cash Flows
<TABLE>
<CAPTION>
From
Inception on
For the Nine For the October 3 ,
Months Ended Year Ended 1994 Through
September 30, December 31, September 30,
1996 1995 1996
------------- ------------ -------------
<S> <C> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss $ (922,717) $ (914,279) $ (1,838,517)
Adjustment to Reconcile Net
Loss to Net Cash Used
by Operating Activities
Depreciation and
amortization 82,551 77,405 159,956
Common stock issued for
services 24,307 135,618 159,925
Change in Assets and Liabilities
(Increase) decrease in inventory (40,333) - (40,333)
(Increase) decrease in other
current assets 70,410 (47,960) (2,981)
Increase in accrued expenses 28,182 44,961 72,873
----------- ---------- ------------
Net Cash Used by
Operating Activities (757,600) (704,525) (1,489,077)
----------- --------- ------------
CASH FLOWS FROM
INVESTING ACTIVITIES
Payment of deposits (6,996) - (6,996)
Purchase of intangibles (41,244) (33,173) (74,417)
Purchase of fixed assets (33,968) (41,114) (75,082)
----------- --------- ------------
Net Cash Used by
Investing Activities (82,208) (74,287) (156,495)
----------- --------- ------------
CASH FLOWS FROM
FINANCING ACTIVITIES
Repayment of notes payable and
contracts payable (8,165) - (8,165)
Proceeds from sale of stock 572,407 978,571 1,551,078
Proceeds from notes payable and
convertible debenture 82,200 26,500 138,700
----------- --------- ------------
Net Cash Provided by
Financing Activities $ 646,442 $1,005,071 $ 1,681,613
----------- --------- ------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 12
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Statements of Cash Flows (Continued)
<TABLE>
<CAPTION>
From
Inception on
For the Nine For the October 3 ,
Months Ended Year Ended 1994 Through
September 30, December 31, September 30,
1996 1995 1996
------------- ------------ -------------
<S> <C> <C> <C>
INCREASE (DECREASE)
IN CASH $ (193,366) $ 226,259 $ 36,041
CASH AT BEGINNING
OF PERIOD 229,407 3,148 -
------------- ------------ -------------
CASH AT END OF PERIOD $ 36,041 $ 229,407 $ 36,041
------------- ------------ -------------
SUPPLEMENTAL DISCLOSURES
OF NON-CASH INVESTING AND
FINANCING ACTIVITIES:
Increase in subscription notes
receivable and future
production costs
receivable $ - $(2,331,800) $ (2,331,800)
Addition to debt for
acquisition of intangibles $ - $ 1,302,914 $ 1,302,914
Common stock issued
for services $ 24,307 $ 135,618 $ 159,925
Equipment acquired under
lease payable $ 25,533 $ - $ 25,533
CASH PAID FOR:
Interest $ - $ 6,134 $ 6,134
Income taxes $ - $ - $ -
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 13
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 1 - COMPANY ORGANIZATION AND BUSINESS ACTIVITY
Sionix Corporation (formerly Automatic Control Corporation) (the "Company") was
incorporated in Nevada on October 3, 1994. The Company was formed to design,
develop, and market an automatic water filtration system primarily for small
water districts.
The Company is in the development stage and its efforts through September 30,
1996 have been principally devoted to research and development, organizational
activities, and raising capital. As of September 30, 1996, the Company has not
yet had any revenues. The ultimate recovery of investments and costs is
dependent on future profitable operations, which presently cannot be determined.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
a. Accounting Method
The Company's financial statements are prepared using the accrual method of
accounting. The Company has elected to change its year end to September 30,
subject to IRS approval. Accordingly, the accompanying statements of operations
and cash flows are for the nine months then ended.
b. Cash Equivalents
The Company considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents.
c. Property and Equipment
Property and equipment are recorded at cost. Major additions and improvements
are capitalized. Minor replacements, maintenance and repairs that do not
increase the useful life of the assets are expensed as incurred. Depreciation of
property and equipment is determined using the straight-line method over the
expected useful lives of the assets as follows:
Description Useful Lives
--------------- ------------
Computers and test equipment 5 years
Furniture and fixtures 5 years
d. Intangible Assets
Intangible assets are recorded at cost. Amortization of the costs are determined
using the straight-line method over the expected useful life of 15 years.
Page 14
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
e. Inventory
Work-in-process and finished goods are stated at the lower of average cost or
market. Inventories at September 30, 1996 consisted of the following:
Work-in-progress $ 33,083
Finished goods 7,250
---------------- --------
Total $ 40,333
========
f. Research and Development
Research and development costs are expensed as incurred.
g. Net Loss Per Share
The computation of net loss per share of common stock is based on the weighted
average number of shares outstanding at the date of the financial statements.
h. Provision for Income Taxes
No provision for income taxes have been recorded due to net operating losses.
The Company accounts for income taxes pursuant to FASB Statement No. 109. The
Internal Revenue Code contains provisions which may limit the loss carryforwards
available should certain events occur, including significant changes in
stockholder ownership interests, accordingly the tax benefit of the loss
carryovers is offset by a valuation allowance of the same amount. The loss
carryovers of approximately $1,835,000 will expire by the year 2011.
i. Recently Issued Accounting Standards
In March 1995, the Financial Accounting Standards Board issued a new statement
titled "Accounting for Impairment of Long-Lived Assets." This new standard is
effective for years beginning after December 15, 1995 and would change the
Company's method of determining impairment of long-lived assets. Although the
Company has not performed a detailed analysis of the impact of this new standard
on the Company's financial statements, the Company does not believe that
adoption of the new standard will have a material effect on the financial
statements.
In October 1995, the Financial Accounting Standards Board issued a new statement
titled "Accounting for Stock-Based Compensation" (FAS 123). The new statement is
effective for fiscal years beginning after December 15, 1995. FAS 123
encourages, but does not require, companies to recognize compensation expense
for grants of stock, stock options, and other equity instruments to employees
based on fair value. Companies that do not adopt the fair value accounting rules
must disclose the impact of adopting the new method in the notes to the
financial statements.
Page 15
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
i. Recently Issued Accounting Standards (Continued)
Transactions in equity instruments with non-employees for goods or services must
be accounted for on the fair value method. Although the Company has not
performed a detailed analysis of the impact of this new standard on the
Company's financial statements, the Company does not believe that adoption of
the new standard will have a material effect on the financial statements.
j. Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
NOTE 3 - PROPERTY AND EQUIPMENT
Property and equipment at September 30, 1996 consisted of the following:
Computers and test equipment $ 125,603
Furniture and fixtures 3,832
---------
Total 129,435
Less accumulated depreciation (22,068)
Property and Equipment - Net $ 107,367
=========
Depreciation expense for the nine months ended September 30, 1996
and for the year ended December 31, 1995 was $16,440 and $5,628,
respectively.
NOTE 4 - INTANGIBLE ASSETS
Intangible assets at September 30, 1996 consisted of the following:
Patents issued and pending $ 102,531
Intellectual property 745,667
Marketing and development costs 500,312
Less accumulated amortization (137,888)
----------
Intangible Assets - Net $1,210,622
==========
Amortization expense for the nine months ended September 30, 1996 and the year
ended December 31, 1995 was $66,111 and $71,777, respectively.
Page 16
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 5 - LOAN PAYABLE
Pursuant to the acquisition agreement as explained in Note 9, the Company
assumed various promissory notes originally signed in 1992 and 1993 totaling
$50,000. The notes bear interest at 8% and were originally due in 1994.
Management of the Company currently cannot locate the holder of the notes and
consequently has not been able to settle the liability. The amount is being
included as a current liability in the accompanying financial statements until
management can locate the note holder and settle the debt.
NOTE 6 - LEASE COMMITMENTS
The Company has entered into an operating lease for its office space. Under the
terms of the lease, the Company is obligated to pay the following for the fiscal
years ended September 30,
1997 $ 83,460
1998 83,460
1999 20,865
----------
Total $ 187,785
==========
The Company leases equipment with a lease term through July of 1999. Obligations
under this capital lease have been recorded in the accompanying financial
statements at the present value of future minimum lease payments. The
capitalized cost of $25,533 less accumulated depreciation of $2,553 is included
in property and equipment in the accompanying financial statements. Depreciation
expense for this equipment for the nine months ended September 30, 1996 was
$2,553.
Obligations under this capital lease consist of the following:
Total $ 23,868
Less: current portion (7,847)
---------
Long-term portion $ 16,021
=========
Page 17
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 6 - LEASE COMMITMENTS (Continued)
The future minimum lease payments under this capital lease and the net present
value of the future minimum lease payments are as follows:
<TABLE>
<CAPTION>
Year Ending
September 30, Amount
-------------- ------
<S> <C>
1997 $9,470
1998 9,470
1999 7,892
2000 -
2001 and thereafter -
------
Total future minimum lease payments 26,832
Less, amount representing interest (2,964)
------
Present value of future
minimum lease payments $23,868
--------
</TABLE>
NOTE 7 - RELATED PARTY PAYABLES
The Company has received advances in the form of promissory notes from various
shareholders and other related parties in order to pay minimal ongoing operating
expenses. As of September 30, 1996, $72,200 was due by the Company as a result
of these promissory notes. The notes bear interest at 10% and 13% and mature
during November and December, 1996. The related parties and shareholders
currently intend to extend the promissory notes at least another year and thus
the corresponding liability has been classified as long-term in the accompanying
financial statements.
NOTE 8 - CONVERTIBLE DEBENTURE
In September 1996, the Company raised $10,000 in 10% redeemable, convertible
debentures. Interest accrues at a rate of 10% and is payable on a quarterly
basis. The principle and unpaid interest are due during September 1998. The
principal amount is convertible at the option of the holder at any time prior to
maturity into shares of the Company's common stock at a rate of $1.00 per common
share.
NOTE 9 - ACQUISITION AGREEMENT AND PLAN OF REVERSE MERGER
On December 1, 1995, Automatic Control Corporation (ACC) entered into an
Acquisition Agreement and Plan of Reverse Merger with Coronado Capital
Corporation (Coronado). The shareholders of ACC and Coronado approved the merger
on December 21, 1995 and December 28, 1995, respectively. The merger was
effective on January 5, 1996. Under the terms of the merger agreement between
the two companies, the stock of Coronado was reverse-split on a 1-for-4 basis
effective as of January 16, 1996, and each pre-merger shareholder of ACC
received 4.819 new shares of the surviving corporation.
Page 18
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 9 - ACQUISITION AGREEMENT AND PLAN OF REVERSE MERGER (Continued)
As a result of the merger, the pre-merger shareholders of ACC made up
approximately 95% of the total issued and outstanding shares of Coronado,
following the effective date of the merger.
Under the terms of the merger agreement, the name of Coronado was changed to
Automatic Control Corporation. On January 23, 1996, the shareholders approved
the change of the Company's name to Sionix Corporation.
NOTE 10 - STOCKHOLDERS' EQUITY
During the year ended December 31, 1995, 414,200 shares of common stock were
issued in return for notes receivable in the amount of $1,656,800. These notes
are secured by the shares issued and are non-recourse. They have a stated
interest rate of 6% and have maturity dates ranging from March 1, 1998 to
September 7, 1998.
In addition to the above mentioned notes, the Company entered into an agreement
for future production costs. Under this agreement, the Company issued 112,500
shares at $6.00 per share for production costs valued at $675,000.
NOTE 11 - RELATED PARTY TRANSACTIONS
The Company entered into an agreement with Automatic Control Technology on
February 28, 1995 to acquire tangible and intangible assets through the
assumption of debt and to act as a research and development consultant to the
Company. Automatic Control Technology is related to the Company through
significant common control. In consideration for the performance for the
consulting portion of this agreement, the Company agreed to pay to Automatic
Control Technology the total costs for consulting plus 5%. The agreement
concluded on February 28, 1996 and the total amount paid by the Company under
the agreement was $215,138 for the nine months ended September 30, 1996.
NOTE 12 - COMMITMENTS AND CONTINGENCIES
The Company is a defendant in a lawsuit in San Diego County Superior Court filed
by an ex-employee. The ex-employee alleges that the Company breached his
employment contract and personally defamed him. The Company has filed its cross
claims and intends to vigorously defend the lawsuit. The ultimate outcome of the
case is uncertain but management believes an unfavorable outcome is unlikely.
Therefore, no accrual has been recorded in the accompanying financial
statements.
Page 19
<PAGE>
SIONIX CORPORATION
(Formerly Automatic Control Corporation)
(A Development Stage Company)
Notes to the Financial Statements
September 30, 1996
NOTE 13 - COMMON STOCK PURCHASE WARRANTS
The Company's Board of Directors has authorized and approved 638,445 common
stock purchase warrants as of September 30, 1996 as follows:
<TABLE>
<CAPTION>
Number Exercise Price Expiration
of Warrants Per Share Date(s)
---------------- -------------- --------------
<S> <C> <C>
570,100 $ 1.00 May 15, 1998 - Sept. 30, 1998
104,445 $ 10.00 January 4, 1998
7,813 $ 5.50 May 15, 1998
</TABLE>
NOTE 14 - GOING CONCERN
The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. However, the Company does not have significant cash or other material
assets, nor does it have an established source of revenues sufficient to cover
its operating costs and to allow it to continue as a going concern. It is the
intent of the Company to generate revenue through the sales of its software and
hardware products. Sales of the software product began in October, 1996 and
hardware sales are scheduled to begin in January, 1997. Additionally, the
Company is in the process of filing a registration statement for a public
offering with the Securities and Exchange Commission. In the opinion of
management, sales of the Company's products, together with the proceeds of an
offering, will be sufficient to fund the Company's operating expenses and
capital requirements for at least the next twelve months. However, the outcome
of these events is currently uncertain.
Page 20
<PAGE>
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders Sionix Corporation
(Formerly Automatic Control Corporation)
San Diego, California
We have audited the accompanying balance sheet of Sionix Corporation
(formerly Automatic Control Corporation) (a development stage company) as of
September 30, 1996, and the related statements of operations, stockholders'
equity and cash flows for the nine months then ended, and for the year ended
December 31, 1995 and from inception on October 3, 1994 through September 30,
1996. 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 audits.
We conducted our audits 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 audits provide 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 Sionix Corporation (formerly
Automatic Control Corporation) (a development stage company) as of September 30,
1996, and the results of its operations and its cash flows for the nine months
then ended, and for the year ended December 31, 1995 and from inception on
October 3, 1994 through September 30, 1996 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 14 to the
financial statements, the Company is a development stage company with no
significant operating results to date and has suffered recurring losses which
raise substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 14. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
/s/ JONES, JENSEN & COMPANY
Sale Lake City, Utah
October 17, 1996
Page 21
<PAGE>
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The following table lists all of the Directors and Executive Officers of
the Company, and provides certain information concerning each such person,
including the number of shares of Common Stock of the Registrant beneficially
owned directly or indirectly by such person at the close of business on
September 30, 1996.
<TABLE>
<CAPTION>
Amount and
Position Nature of Percent
with Beneficial of
Name Age Since Registrant Ownership Class
- --------------- --- ----- ---------- ----------- -------
<S> <C> <C> <C> <C> <C>
Michael Taylor 43 1996 CEO/CFO 1,020,456 4.33%
Director
Jack Moorehead 65 1996 President 723,929 3.07%
Director
S. Donna
Friedman(1) 63 1995 Secretary 9,638,000 40.87%
Director
Laura Friedman(1) 28 1995 Director 383,786 1.63%
Cheryl Friedman(1) 30 1995 Director 383,786 1.63%
</TABLE>
- ---------------------------
(1) Director, S. Donna Friedman is the mother of Directors Laura Friedman
and Cheryl Friedman.
Principal Occupation
Michael Taylor - Elected as a Director and appointed as CEO/CFO of the
Registrant in May 1996. Mr. Taylor has a BA degree in Business Administration
(with a specialty in accounting) from California State University, Fullerton,
and has practiced as a tax and financial consultant since 1977. Mr. Taylor was
President, CEO and a Director of Coronado Capital Corporation from February 15,
1994 until the merger with Sionix Corporation.
Jack Moorehead - Elected as a Director on December 28, 1995 and appointed
as the President of the Registrant in May, 1996. Mr. Moorehead has a degree in
Civil Engineering from the University of Detroit, and completed graduate courses
in marketing at the University of Miami. He was a marketing executive with
Florida Power and Light and Bevis Associates, their advertising agency under
Vice President D.P. Cauldwell. Before founding Sionix Corporation, he served as
a consultant for a variety of firms, patenting new products and developing
marketing programs for those products. He was granted six U.S. patents for an
automatic rapid back flush filter system, a dissolved air flotation system, and
an apparatus for mixing ozone, chemicals and liquids, which are all now assigned
to Sionix Corporation.
Page 22
<PAGE>
S. Donna Friedman - Elected as a Director and appointed as Secretary and
Treasurer on December 28, 1995. As Executive Assistant to the President,
Lockheed Air Terminal, Inc. in Burbank, California, Ms. Friedman processed legal
documents and contracts, leases, proposals, acquisitions, agenda, minutes and
resolutions, financial and budget related material. Prior to joining Lockheed,
Ms. Friedman also proposed, developed and implemented plans for product
scheduling and shipping for an automated systems manufacturer.
Cheryl Friedman - Elected as a Director on December 28, 1995. Ms. Friedman
graduated with honors from UC, Santa Barbara, with a BA in Communication
Studies. She is currently a Management Supervisor at McCann-Erickson Worldwide
Advertising agency in charge if the marketing and advertising for Nestle
Beverage Company. She started her career at J. Walter Thompson in San Francisco
in 1988 before joining the San Francisco office of Ketchum Communications to
launch the first Investment Services advertising campaign for Bank of America.
She joined Ogilvy & Mather Advertising in New York in April, 1993 working on
Kraft General Foods. Shortly thereafter, she became Account Supervisor
responsible for all new product development for Post Kids Cereals. Ms.
Friedman's Project Phoenix program created three new Kraft Foods assignments
worth an estimated $42 million. She has traveled extensively throughout the
United States, Canada, Europe, Africa and the Middle East.
Laura Friedman - Elected as a Director on December 28, 1995. Ms. Friedman
received a BS in Business Administration with an emphasis in Marketing from San
Diego State University. She was Media Planner and Buyer at Franklin Stoorza
Advertising for the San Diego County Water Authority, International Savings
Bank, Voucher Corporation, McDonald's and Travelodge Hotels before joining
Ammirati & Puris/Lintas Advertising, New York. Ms. Friedman controls $100
million in annual media billings for Aetna, RCA, and other clients. She has
traveled extensively throughout the United States, Canada, Europe, Africa and
the Middle East.
ITEM 11. EXECUTIVE COMPENSATION
Compensation of Officers
For the fiscal year ended September 30, 1996, executive officers received
compensation as follows:
<TABLE>
<CAPTION>
Name Position Amount of Compensation
--------------- -------- ----------------------
<S> <C> <C>
Michael Taylor CEO/CFO 520,000 shares (1)
Jack Moorehead President $ 45,953
S. Donna Friedman Sec/Treas. $ 0
</TABLE>
- --------------------------
(1) See Item 13., for information regarding compensation of Michael A. Taylor.
Employment Contracts/Stock Incentive Plans
No employment contracts or stock incentive plans were adopted or granted by
the Company during the fiscal year ended September 30, 1996.
Compensation of Directors
No director of the Company received any compensation during the fiscal year
ended September 30, 1996.
Page 23
<PAGE>
Item 12. Security Ownership Of Certain Beneficial Owners And Management
The following table sets forth information, to the extent known by the
Company, as to the persons and companies who owned beneficially more than five
percent (5%) of the outstanding shares of the Common Stock of the Company at the
close of business on September 30, 1996, and the beneficial ownership of the
Company, as a group, as of such date. The number of shares held by each Director
is set forth in Item 10 hereinabove.
<TABLE>
<CAPTION>
Title of Amount and Nature of
Class Name and Address Beneficial Ownership Percent of Class
- ----------- ----------------- -------------------- ---------------
<S> <C> <C> <C>
Common S. Donna Friedman Trust 9,638,000 40.87%
4120 Porte De Merano #80
San Diego, CA. 92122
Common All Directors and 12,149,957 51.52%
Officers as a Group
(Five [5] Persons)
</TABLE>
Item 13. Certain Relationships and Related Transactions
Consulting Agreement with Michael A. Taylor
On May 15, 1996, the Company entered into a consulting agreement with
Michael A. Taylor under which Mr. Taylor as consultant would provide financial,
tax and management consultant services to the Company with regard to matters
that effect the accounting, tax return preparation, fund raising and management
of the Company. The term of the consulting agreement is for a period of two (2)
years. Under the terms of said contract as approved and adopted by the board of
directors, Mr. Taylor would receive as compensation for his services to the
Company five hundred thousand shares (500,000) of common stock. In consideration
of the continued performance and services to be provided by Mr. Taylor to the
Company under the consulting agreement, the Company agreed to pay Mr. Taylor in
current funds as compensation fort his services a fee of $5,000 per month plus
reimbursement for all out of pocket costs, or in lieu of cash, cause to be
issued ten thousand (10,000) shares of common stock per month. Mr. Taylor has
not been paid any cash compensation for his services and has been issued 20,000
shares of common stock as compensation under said consulting agreement.
Purchase of Unregistered Shares of the Company's Common Stock.
During the period covered by this report, Jack F. Moorehead, the President
and a Director of the Company purchased 26,000 shares of unregistered and
restricted common stock of the Company at a price of $1.00 per share. Michael A.
Taylor, the Chief Executive Officer, Chief Financial Officer and a Director of
the Company purchased 116,500 shares of unregistered and restricted common stock
of the Company at a price of $1.00 per share.
Page 24
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules and Reports On Form 8-K
(a) Documents filed as a part of this report:
(1) Financial Statements of Sionix Corporation set forth under Item 8 are
filed as part of this report.
(2) To include the Financial Statement Schedules other than those listed
above have been omitted since they are either not required, not applicable, or
the information is otherwise included.
(b) Information filed as part of this report from Form 8-K:
(1) A Current Report on Form 8-K regarding the change of control of the
Company and the resignation of the Company's directors was filed on January 24,
1996, for the period covered by this report.
(2) An Amended Current Report on Form 8-K was filed on February 28, 1996,
amending and restating the Current Report on Form 8-K filed on January 24, 1996,
to included Financial Statements of Automatic Control for the periods ended
December 31, 1995 and 1994 and Consolidated Pro Forma Financial Statements dated
December 31, 1995.
(3) A Current Report on Form 8-K was filed on April 15, 1996, to set forth
the executive officers of the Company elected at a special meeting of the
Directors on April 2, 1996.
(4) A Current Report on Form 8-K was filed on April 29, 1996, to report the
resignation of Dr. John Palmer as a director of the Company.
(5) A Current Report on Form 8-K was filed on July 1, 1996, to report the
appointment of Michael A. Taylor as a director of the Company and the
resignation by Michael Maung as a director of the Company.
(6) A Current Report on Form 8-K was filed on October 24, 1996, to report
the change of the fiscal year end of the Company from December 31 to September
30, 1996.
Page 25
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
SIONIX CORPORATION
(Registrant)
Date: December 19, 1996 /s/ Jack F. Moorehead
---------------------------
By: Jack Moorehead
Its: President
Date: December 19, 1996 /s/ Michael A. Taylor
---------------------------
By: Michael A. Taylor
Its: Chief Executive Officer
Chief Financial Officer
Date: December 19, 1996 /s/ S. Donna Friedman
---------------------------
By: S. Donna Friedman
Its: Secretary
Page 26
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 36,041
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 40,333
<CURRENT-ASSETS> 79,355
<PP&E> 1,477,945
<DEPRECIATION> 159,956
<TOTAL-ASSETS> 1,404,340
<CURRENT-LIABILITIES> 170,119
<BONDS> 0
0
0
<COMMON> 23,600
<OTHER-SE> 1,112,400
<TOTAL-LIABILITY-AND-EQUITY> 1,404,340
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,512
<INCOME-PRETAX> (922,717)
<INCOME-TAX> (922,717)
<INCOME-CONTINUING> (922,717)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (922,717)
<EPS-PRIMARY> (0.04)
<EPS-DILUTED> (0.04)
</TABLE>
