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
_____________________________________
October 26, 2000
Date of Report
(Date of Earliest Event Reported)
RECOM MANAGED SYSTEMS, INC.
(Exact Name as Specified in its Charter)
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Delaware 33-11795 84-0441351
(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
914 WESTWOOD BLVD., SUITE 809
LOS ANGELES, CA 90024
(Address of principal executive offices)
818/702-9977
Registrant's telephone number
2412 Professional Drive
Roseville, CA 95661
(Former address if changed since last report)
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ITEM 1. CHANGES IN CONTROL OF REGISTRANT
As the result of the confirmation of the Registrant's Plan of
Reorganization in bankruptcy, Vanguard West, LLC, a Nevada limited liability
company, was issued a total of 1,200,000 shares of the Registrant's common
stock, which represents approximately 87% of the total number of outstanding
shares of voting common stock after full implementation of the Plan of
Reorganization. See Item 3 below. The manager of the Vanguard West, LLC is Sim
Farar. Vanguard West contributed $100,000 to the bankruptcy estate. Vanguard
West also contributed $25,000 toward the settlement of one legal matter related
to the bankruptcy. This consideration came from the private funds of Vanguard
West. Prior to the bankruptcy, only one shareholder owned more than 10% of the
Registrant's outstanding common stock and that was Recom Technologies, Inc.,
which owned approximately 13% of the previously outstanding shares of common
stock.
As a result of the issuance of the stock to Vanguard West through the
bankruptcy Plan of Reorganization, the previous officers and directors of the
Registrant voluntarily resigned their positions and were replaced by the
following individuals:
Sim Farar President, Chief Financial Officer and Director
Arthur Lyons Secretary and Director
ITEM 3. BANKRUPTCY OR RECEIVERSHIP
On June 26, 2000, the Registrant filed for bankruptcy protection under
Chapter 11 of the U.S. Bankruptcy Code. The filing was made in the Eastern
District of California, Sacramento Division (Case No. 00-27398-B-11).
On September 20, 2000, the Registrant submitted a proposed Plan of
Reorganization which was preliminarily approved by the bankruptcy court and
mailed to all creditors and shareholders for their approval. The Plan is
summarized below.
The Plan provided for the treatment of the pre-petition claims by creditors
and the interests of shareholders by dividing them into two classes. The general
unsecured creditors, as Class 1, would share, on a pro rata basis, in any cash
assets available for distribution to creditors (which consisted primarily of the
$100,000 contributed by Vanguard West). Creditors could elect to receive $500
cash in liquidation of their entire claim. For creditors not electing the $500
payment, they would be paid a pro rata share of the net cash assets of the
Registrant and be issued shares of the Registrant's common stock pro rata, based
upon the amount of each creditor's claim remaining unpaid after all cash assets
had been disbursed. The maximum number of shares issuable to Class 1 creditors
in recognition of their unpaid claims is 60,000 shares. At the present time, the
disbursing agent appointed by the bankruptcy court is in the process of
validating unsecured claims and will determine the distribution of the 60,000
shares among creditors. These shares, when issued, will represent approximately
4.3% of the then outstanding shares of the Registrant's common stock.
The Class 2 creditors were shareholders of the Registrant. As part of the
Plan of Reorganization, all existing outstanding shares of the Registrant's
common stock were reverse split, whereby every 28.74 shares of outstanding
common stock were consolidated into one share of post-reverse split common
stock. However, no current shareholder received less than one share of the
post-split common stock. No shareholder received any cash distribution in their
capacity as a shareholder. The reverse stock split is effective on November 9,
2000, pursuant to which the 3,448,986 shares of outstanding common stock were
consolidated into approximately 120,000 shares of stock, representing
approximately 8.7% of the current outstanding shares of the Registrant's common
stock.
As indicated above, the Plan also provided for the issuance of 1,200,000
shares of common stock to Vanguard West, LLC in exchange for the $100,000
payment made into the bankruptcy estate by Vanguard West, LLC. This amount
represents approximately 87% of the total of approximately 1,380,000 shares of
the Registrant's common stock which will be outstanding upon the full
implementation of the Plan.
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The Plan also provided for a total discharge of the Registrant and its
officers and directors from all pre-petition debts, expenses and legal causes of
action which may have existed on or before the filing of the bankruptcy on June
26, 2000.
The Plan also provided for the payment of administrative costs and
professional fees in the amount of approximately $30,000 with the remainder of
any cash assets to be distributed on a pro rata basis to Class 1 creditors.
All of the votes received from creditors and shareholders were in favor of
acceptance of the Plan as proposed.
The Plan was confirmed by the bankruptcy court on October 26, 2000 with the
effective date of the Plan occurring 11 days after the confirmation, which was
November 6, 2000.
As a result of the reverse stock split, the Registrant's post-reverse split
common stock is now listed on the OTC Bulletin Board under the new symbol
"RECM."
The Registrant will no longer be conducting operations as an applications
service provider. Pursuant to the Registrant's new direction, management will be
actively engaged in evaluating various companies which may offer new lines of
business and may result in a business acquisition by, or a combination with, the
Registrant. Until such new lines of business are commenced, the Registrant will
operate with minimal assets and liabilities and no operating income. Vanguard
West, LLC will make capital investments or cash advances to the Registrant to
cover operating expenses of the Registrant for the foreseeable future.
SIGNATURE
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 hereunto duly authorized.
RECOM MANAGED SYSTEMS, INC.
Dated: November 8, 2000 /S/ SIM FARAR
Sim Farar, CEO
(Authorized Officer and Principal Financial
Officer)
