As filed with the Securities and Exchange Commission on July 14, 2000
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, DC. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934.
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934.
For the Quarterly Period Ended May 31, 2000
Commission file number 000-28506
TRACKPOWER, INC.
(Exact name of small business issuer as specified in its charter)
Wyoming 13-3411167
(State of Incorporation) (IRS. Employer ID No.)
67 Wall Street
Suite 2411, New York, NY 10005
(Address of Principal Executive Offices)
(212) 804-5704
(Registrant's Telephone No. including area code)
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 for such 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 __
The number of shares outstanding of each of the Registrant's class of common
equity, as of July 4, 2000 are as follows:
Class of Securities Shares Outstanding
------------------- ------------------
Common Stock, $.0001 par value 36,443,742
================================================================================
<PAGE>
TrackPower, Inc.
INDEX
PART I Financial Information
Item 1. Financial Statements (unaudited)
Balance Sheet.......................................... 3
Statements of Operations and Comprehensive Loss........ 5
Statements of Cash Flows............................... 6
Notes to Financial Statements.......................... 7
Item 2. Management's Discussion and Analysis or Plan of Operation... 9
PART II. Other Information
Item 1. Litigation.................................................. 13
Item 2. Change in Securities and Use of Proceeds.................... 13
Item 3. Defaults Upon Senior Securities............................. 13
Item 4. Submission of Matters to a Vote of Security Holders......... 13
Item 5. Other Information........................................... 13
Item 6. Exhibits and Reports on Form 8-K............................ 14
A) Exhibit Schedule
B) Reports Filed on Form 8-K
Signatures............................................................. 16
<PAGE>
PART I. Financial Information
Item 1. Financial Statements
TrackPower, Inc.
Balance Sheet
(UNAUDITED)
May 31, 2000
ASSETS
Current Assets:
Cash $ 11,155
Accounts receivable 24,638
Notes receivable 10,764
Marketable securities 240,000
Acquisition deposit 125,000
Other current assets 20,375
---------------------------------------------------------------
Total current assets 431,932
---------------------------------------------------------------
Property and equipment:
Property and equipment 165,939
Less: Accumulated depreciation (128,168)
---------------------------------------------------------------
Net property and equipment 37,771
Other assets:
Distribution rights, net of accumulated 98,499
amortization
Deferred costs 146,169
Deposits 65,206
TrackPower trademarks and other 353,590
intellectual property rights
---------------------------------------------------------------
663,464
---------------------------------------------------------------
TOTAL ASSETS $1,133,167
---------------------------------------------------------------
See accompanying notes to financial statements.
3
<PAGE>
TrackPower, Inc.
Balance Sheet
(UNAUDITED)
May 31, 2000
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Accounts payable (including $1,744 due to $ 112,125
related parties)
Accrued professional fees 309,326
Accrued interest 173,990
Other accrued expenses 101,438
Note payable - related party 10,370
------------------------------------------------------------------
Total current liabilities 707,249
------------------------------------------------------------------
Long term debt:
8% senior subordinated convertible debentures due 4,657,000
October 31, 2004
------------------------------------------------------------------
Total liabilities 5,364,249
Shareholders' equity (deficit):
Convertible preferred stock, no par value, 1,000,000
unlimited shares authorized, (liquidation value
$1,000,000)
Common stock, $.0001 par value; unlimited shares 3,602
authorized, 36,013,945 shares, issued and
outstanding on May 31,2000
Additional paid in capital 12,229,135
Accumulated deficit (17,463,819)
------------------------------------------------------------------
Total shareholders' equity (deficit) (4,231,082)
------------------------------------------------------------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $1,133,167
(DEFICIT)
------------------------------------------------------------------
See accompanying notes to financial statements.
4
<PAGE>
TrackPower, Inc.
Statements of Operations and Comprehensive Loss
(UNAUDITED)
Three Months Ended
May 31,
2000 1999
---- ----
Revenue
Royalties from distribution rights $ 1,627 $ 2,948
Net subscription revenue - 818
Wagering commissions 46,437 -
Other revenue 138 644
-------------------------------------------------------------------------------
Total revenue 48,202 4,410
Operating expenses:
Wages and consulting fees 177,122 87,512
Management fees 75,000 75,000
Transponder fees 600,000 100,000
Advertising and marketing 23,888 12,610
Professional fees 202,917 -
General and administrative 156,994 59,643
-------------------------------------------------------------------------------
Total operating expenses 1,235,921 334,765
Loss from operations: (1,187,719) (330,355)
Other expenses:
Interest 101,252 17,258
Non-cash financing expense 49,750 32,725
Realized losses on marketable - 6,331
securities
Depreciation and amortization 13,117 12,252
-------------------------------------------------------------------------------
Total other expenses 164,119 (68,566)
Net loss (1,351,838) (398,921)
Preferred dividends (18,332) (67,500)
-------------------------------------------------------------------------------
Net loss applicable to common $(1,370,170) $(466,421)
shareholders
-------------------------------------------------------------------------------
Basic and diluted loss per share of $(0.04) $(0.02)
common stock
-------------------------------------------------------------------------------
Weighted average number of common 34,881,046 26,412,450
shares outstanding
-------------------------------------------------------------------------------
Comprehensive Loss
Net loss $(1,351,838) $(398,921)
Other comprehensive income
Unrealized holding gain on - 28,123
marketable securities
-------------------------------------------------------------------------------
Comprehensive loss $(1,351,838) $(370,698)
-------------------------------------------------------------------------------
See accompanying notes to financial statements.
5
<PAGE>
TrackPower, Inc.
Statements of Cash Flows
(UNAUDITED)
Three Months Ended
May 31,
Increase (Decrease) in Cash
2000 1999
---- ----
------------------------------------------------------------------------------
Net cash used in operations
Net loss $(1,351,838) $(398,921)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Depreciation and amortization 13,117 12,252
Non-cash financing expense
incurred in connection with (49,750) -
issuance of convertible
debentures
Loss on sale of marketable - 6,331
securities
Changes in:
Accounts receivable 39,945 (818)
Prepaid transponder fees 200,000 -
Due to related parties - (129,159)
Other current assets (12,875) (3,669)
Deferred costs (146,169) -
Accounts payable (189,575) 18,863
Accrued professional fees 309,326 -
Accrued interest 92,030 -
Other accrued expenses 12,452 (50,893)
------------------------------------------------------------------------------
Net cash used in operating activities (1,083,337) (546,014)
------------------------------------------------------------------------------
Cash flows from investing activities:
Marketable securities purchased (240,000) 145,179
(sold)
Deposits (20,692) (86,000)
Deposit on acquisition (125,000) -
Purchase of property and (10,000) (2,648)
equipment
------------------------------------------------------------------------------
Net cash provided by (used in) (395,692) 56,531
investing activities
------------------------------------------------------------------------------
Cash flows from financing activities:
Proceeds from options exercised 733,617 125,000
Proceeds from sale of common - 275,722
stock, net
Proceeds from warrants exercised 123,079 -
Proceeds/(repayment) of notes - (203,750)
payable
Proceeds on issuance of 382,000 505,000
convertible debentures
------------------------------------------------------------------------------
Net cash provided by financing 1,238,696 701,972
activities:
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Increase (decrease) in cash (240,333) 212,489
------------------------------------------------------------------------------
Cash, beginning of period 251,488 18,089
------------------------------------------------------------------------------
Cash, end of period $ 11,155 $ 230,578
------------------------------------------------------------------------------
Noncash activities: During the three month period ended May 31, 2000 the Company
issued 200,000 shares of its common stock upon conversion of $100,000 of
convertible debentures.
See accompanying notes to financial statements.
6
<PAGE>
TrackPower, Inc.
Notes to Financial Statements
May 31, 2000
Summary of significant accounting policies
Nature of business
The Company was organized on June 30, 1993 under the laws of Wyoming.
Prior to August 26, 1999, the Company operated under the name American Digital
Communications, Inc. The Company had intended to provide wireless two-way
communications in the 220 mHz. band, and the Company held distribution rights
for various Midland brand commercial land mobile radios and radio parts acquired
in separate transactions during 1995 and 1996. During fiscal year 1998, the
Company sold, sub-licensed or wrote off all remaining distribution rights. On
January 15, 1998, the Company acquired the TrackPower trade name and other
intellectual property rights from Simmonds Capital Limited ("Simmonds Capital").
The TrackPower service, when fully implemented, will distribute live horse
racing video to subscribers' homes via satellite and such subscribers will be
able to place wagers interactively through the World Wide Web and television,
subject to any applicable legal restrictions. The Company will not accept or
place any wagering transactions but will deliver the wager to a state-licensed
account wagering entity.
Recent Developments
On March 6, 2000 the Company entered into a letter of intent with Penn
National Gaming Inc. ("Penn") and eBet Limited ("eBet") whereby each would
either sell certain of their subsidiaries or contribute various assets,
technologies, business operations, contracts and management agreements to the
Company in exchange for 18,000,000 shares of the Company's common stock each
plus warrants to purchase additional shares of the Company's common stock. On
June 28, 2000, the Company announced that it had entered into a letter of intent
with respect to a revised USA race wagering joint venture with eBet. Under the
revised terms, TrackPower would acquire eBet's US subsidiary, eBet Racing USA
Inc., ("eBet Racing") in exchange for 12,000,000 shares of the Company's common
stock, warrants to purchase an additional 5,000,000 common shares at $1.00 per
share over the next three years and a $2,000,000 note payable in cash or common
shares at the discretion of the Company. eBet Racing holds the exclusive license
to the eBet racing technology in the United States. This technology has been
licensed exclusively to Penn and eBet Racing receives a 2% royalty on all wagers
processed through Penn. The Company also announced plans to acquire an exclusive
10 year license to utilize eBet's interactive wagering technology in Canada in
exchange for 2,000,000 shares of the Company's common stock. The Company also
committed to a contract with eBet Limited for a minimum of $500,000 in
development services of emerging distribution platforms such as Palm Pilots and
interactive television. Through the acquisition of eBet Racing the Company will
be entitled to receive a $500,000 license fee and ongoing royalty payments of
between 2% and 4.75% from Penn. Management does not intend to pursue the March
6, 2000 deal at this time and further believes that the revised joint venture
agreement is on significantly better terms for the Company.
7
<PAGE>
Basis of presentation
The accompanying unaudited financial statements of TrackPower, Inc. have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-QSB and item
310 (b) of Regulation S-B. Accordingly they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three months ended
May 31, 2000 are not necessarily indicative of the results that may be expected
for the fiscal year ending February 28, 2001. For further information, refer to
the financial statements and footnotes thereto included in the Company's annual
report on Form 10-KSB for the fiscal year ended February 29, 2000.
Use of 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.
Marketable securities
During the quarter ended May 31, 2000, the Company purchased 80,000 shares
of common stock of a publicly traded entity. These securities are considered
"available for sale" and, accordingly, are recorded at market value with
unrealized gains or losses to be recorded as a separate component of
shareholders' equity (deficit). At May 31, 2000, there was no material
difference between the cost and the fair market value of these securities.
Acquisition deposit
During the quarter ended May 31, 2000, the Company and eBet each
contributed $125,000 to a newly formed entity which, in turn, made a $250,000
non-refundable deposit on the potential acquisition of a horseracing related
entity.
The transaction is subject to various terms and conditions, including that
the Company make certain additional payments in connection with the potential
acquisition referred to above, due diligence review and the obtaining of certain
approvals and consents.
Convertible debentures
During the quarter ended May 31, 2000, the Company raised $382,000 through
the issuance of additional 8% senior subordinated convertible debentures.
Additionally, $100,000 of the convertible debentures were converted into 200,000
shares of common stock. Accordingly, the total face value of convertible
debentures increased from $4,375,000 at February 29, 2000 to $4,657,000 at May
31, 2000.
8
<PAGE>
Net loss per share
Basic loss per common share is based on the weighted average number of
shares outstanding during each period presented. Convertible debentures, options
to purchase stock and warrants are included as common stock equivalents only
when dilutive. Potential common stock equivalents totaling 10,863,000 shares at
May 31, 2000 have been excluded as the effects of such shares would have been
anti-dilutive.
Item 2. Management's Discussion and Analysis or Plan of Operation.
Overview
During the quarter ended May 31, 2000, management continued to develop the
TrackPower business in a number of different areas. The Company made several
strategic investments for the future and also explored a series of different
business combination scenarios.
On March 6, 2000 the Company entered into a letter of intent with Penn
National Gaming Inc. and eBet Limited whereby each would either sell certain of
their subsidiaries or contribute various assets, technologies, business
operations, contracts and management agreements to the Company in exchange for
18,000,000 shares of the Company's common stock each plus warrants to purchase
additional shares of the Company's common stock.
On June 28, 2000, the Company announced its intention to enter into a
revised USA race wagering joint venture with eBet. Under the revised terms,
TrackPower would acquire eBet's US subsidiary, eBet Racing USA Inc., ("eBet
Racing") in exchange for 12,000,000 shares of the Company's common stock,
warrants to purchase an additional 5,000,000 common shares at $1.00 per share
over the next three years and a $2,000,000 note payable in cash or common shares
at the discretion of the Company. eBet Racing holds the exclusive license to the
eBet racing technology in the United States. This technology has been licensed
exclusively to Penn and eBet Racing receives a 2% royalty on all wagers
processed through Penn. The Company also announced plans to acquire an exclusive
10 year license to utilize eBet's interactive wagering technology in Canada in
exchange for 2,000,000 shares of the Company's common stock. The Company also
committed to a contract with eBet Limited for a minimum of $500,000 in
development services of emerging distribution platforms such as Palm Pilots and
interactive television. Through the acquisition of eBet Racing the Company will
be entitled to receive a $500,000 license fee and ongoing royalty payments of
between 2% and 4.75% from Penn. Management believes that the revised joint
venture agreement is on significantly better terms for the Company. The Company
will retain the above mentioned royalty payments, as well as existing revenue
sharing arrangements between TrackPower and Penn with respect to all telephone,
Internet and other interactive wagering arising from its subscribers.
On May 18, 2000, the Company contributed $125,000 to an entity co-owned by
eBet and TrackPower to partially fund a non-refundable deposit on a potential
acquisition. eBet also contributed $125,000 to the venture for the same purpose.
The acquisition is in a horseracing-related field. The transaction is subject to
various terms and conditions, including that the Company make certain additional
payments in connection with the potential acquisition referred to above, due
diligence review and the obtaining of certain approvals and consents.
9
<PAGE>
During the quarter ended May 31, 2000, the Company made an investment of
$240,000 in Vianet Technologies Inc., a company listed on the OTCBB under the
symbol "VNTK". The investment included 80,000 common shares of Vianet and
warrants to purchase 120,000 common shares of Vianet at $4.50 per share over the
next 3 years. The reason for the investment was because Vianet possesses a
superior compression technology that may be applicable to the streaming of live
horseracing video signals over the Internet.
In addition the Company acquired the Harness Tracker software and the web
address www.harness.com, which enables members to USTA and CTA databases for
information on selected horses that they are following. The cost of the
acquisition was $10,000. The Company also made payments to Post Time
Technologies to develop an interactive interface to provide bettors with
archived video replays and related information, such as results and times.
Results of operations
Revenues for the three month period ended May 31, 2000 were $48,202
compared to $4,410 during the comparative period in the prior year. The Company
initially launched the TrackPower service under the SkyVista service on April 1,
1999 and subsequently relaunched under EchoStar's DishNetwork on July 1, 1999,
therefore the operational revenues in the prior period are substantially lower.
The majority of the Company's revenues are from wagering commissions
earned under contract with Penn. Under the Penn agreement, the Company receives
commissions from Penn based on the amount of wagering arising from TrackPower
subscribers. Wagering commissions during the three-month period ended May 31,
2000 were $46,437 compared to zero in the prior period.
The Company also received $1,627 during the three month period ended May
31, 2000 ($2,948 during the comparative period in the prior year), for royalties
under a sub-license agreement on Midland brand two-way radio sales in certain
territories of Canada.
Operating expenses totaled $1,235,921 during the three-month period ended
May 31, 2000 up from $334,765 in the prior period. The increase of approximately
$901,000 is attributable to increases in the following cost categories;
transponder fees $500,000, professional fees $203,000, general & administrative
costs $97,000, wages & consulting fees $90,000 and advertising & marketing costs
$12,000. Transponder fees during the prior period were for April and May 1999
only and were under the less expensive SkyVista service. Professional fees were
legal and accounting costs incurred during the Company's SB-2 registration
statement filed on March 15, 2000 and other financing and public reporting
oriented costs. The Company has deferred $146,169 in legal costs attributable to
the proposed eBet joint venture. Wages and consulting fees are higher than the
prior year due to the Company operating the TrackPower service for the full
quarter in 2000 and additional staff required growing the business.
Other expenses totaled $164,119 during the three month period ended May
31, 2000, including interest of $101,252, non-cash financing expenses of
$49,750, and depreciation of fixed assets and amortization of Midland
distribution rights and TrackPower technology rights of $13,117. During the
comparative period in the prior year interest expense totaled $17,258 and
depreciation and amortization was $12,252. The Company also recorded non-cash
financing
10
<PAGE>
expenses of $32,725 and a loss on disposal of marketable securities of $6,331
during the three month period ended May 31, 1999. Non-cash financing expenses
during the three month period ended May 31, 2000 relate to commissions and
finders fees incurred in issuing convertible debentures. It is anticipated that
these fees will be satisfied with the issuance of warrants to purchase common
stock. Interest expense is substantially higher during the three month period
ended May 31, 2000 due to the Company financing growth through the issuance of
convertible debentures.
The net loss during the three month period ended May 31, 2000 was
$1,351,838 ($0.04 per share) compared to $398,921 ($0.02 per share) for the
three month period ended May 31, 1999.
Financial Condition
The accompanying financial statements have been prepared on a going
concern basis which contemplates the realization of assets and liquidation of
liabilities in the ordinary course of business.
Since inception, the Company has supported operations through the issuance
of common stock and convertible debt and other securities. During fiscal 2000,
the Company began executing its business plan through the launching of the live
video and wagering services. Recently, the Company entered into a letter of
intent with eBet to form a new joint venture in the United States. Management
hopes that the combined business will be successful and will provide higher
levels of operating cash flow.
The continued operations of the Company are dependent upon its ability to
raise additional capital, achieve acceptance of its service, expand operations,
compete effectively against competitors, and retain key personnel. Additionally,
regulatory and/or legal issues may arise which could restrict or eliminate the
Company's means of conducting business.
During the three month period ended May 31, 2000, the Company made an
investment in 80,000 common shares of Vianet Technologies Inc. at $3.00 per
share. Vianet common shares are quoted under the symbol "VNTK" on the NASD's OTC
Bulletin Board. The Company also received 120,000 warrants to purchase common
shares of Vianet Technologies at $4.50 at any time over the next three years.
The Company made the investment based on the compression technology held by
Vianet, which could be used in the streaming of, live horseracing video signals
over the Internet. On May 31, 2000, the closing share price for Vianet was
$3.00 per share.
Property and equipment increased by $10,000 during the quarter as a result
of the Company's investment in the Harness Tracker software. The Company also
made new deposits of approximately $20,692 on the development of a new product
that will deliver video archives of recent horse races via the web-site. The new
product is being developed by Post Time Technologies Inc. and is expected to be
available during the summer months of 2000.
Liquidity and Capital Resources
As of May 31, 2000, the Company had cash reserves of $11,155, an
investment in
11
<PAGE>
marketable securities of $240,000 and a working capital deficit of $275,317. For
the three month period ended May 31, 2000, cash used by operating activities
amounted to $1,083,337, primarily as a result of operating losses for the
period. Cash used by investing activities during the three month period ended
May 31, 2000 amounted to $395,692 and consisted primarily of a $240,000
investment in marketable securities and a $125,000 non-refundable deposit in
connection with a proposed acquisition. Cash provided by financing activities
during the three month period ended May 31, 2000 amounted to $1,238,696 and
resulted from $856,696 in proceeds from the issuance of common stock and
$382,000 from the proceeds from the issuance of convertible debt.
The Company's ability to continue to fund losses arising from costs and
expenses exceeding revenue is connected to its ability to raise additional
financing prior to achieving a break even level of operating results. The
Company continues to raise funds primarily by issuing common stock and
convertible debt. At May 31, 2000, there were $4,657,000 outstanding in
convertible debentures. As of July 4, 2000 the Company has received commitments
for the issuance of $5,500,000 in new convertible debentures, of which
$5,107,000 has been received by the Company.
The Company has taken steps to reduce monthly operating costs to lessen
the burden on raising further funds. In January 2000, the Company reduced the
monthly transponder fees from $400,000 to $200,000 and management is exploring
other cost saving measures.
In addition, the Company is hopeful that the proposed joint venture
agreement with eBet and the potential acquisition underlying the $125,000
non-refundable deposit, if consummated, will improve the operating loss position
of the Company and provide an opportunity to recapitalize. Although discussions
are proceeding, there can be no assurance that either of these transactions will
in fact be consummated.
Forward Looking Comments
Certain matters discussed in this Quarterly Report may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 and as such may involve risks and uncertainties.
These forward-looking statements relate to, among other things, expectations of
the business environment in which the Company operates, projections of future
performance, perceived opportunities in the market and statements regarding the
Company's goals. The Company's actual results, performance, or achievements
expressed or implied in such forward-looking statements may differ.
12
<PAGE>
PART II. Other Information
Item 1. Litigation.
The Company believes that it is not presently a party to any pending
litigation or any proceeding contemplated by a government authority the outcome
of which could reasonably be expected to have a material adverse effect on its
financial condition or results of operations.
Item 2. Change in Securities and Use of Proceeds.
During the period covered by this report, the Company issued $382,000 in
convertible debentures in transactions exempt from registration under the
Securities Act of 1933, as amended. These debentures are five year senior
subordinated 8% notes, that are convertible at the option of the note holder
into common shares of the Company at $0.50 per share. Upon conversion a warrant
is issued to purchase another common share exercisable at $0.75 per share at any
time over the next five years. All notes automatically convert to common shares
at maturity. The Company has the option to repay in cash at any time.
During the three month period ended May 31, 2000 $100,000 of convertible
debentures were converted into 200,000 shares of the Company's common stock.
Item 3. Defaults Upon Senior Securities.
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 5. Other Information.
Not applicable.
13
<PAGE>
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
Exhibit Document
------- --------
1 Underwriting Agreement
1.1 Placement Agent Agreement, between Registrant and Pellinore Securities
Corporation ("Pellinore"), dated April 17, 1998 (incorporated by
reference to Exhibit 1 of the Registrant's Form 8-K dated May 7,
1998).
2 Plan of Acquisition, Reorganization, Arrangement, Liquidation or
Succession
2.01 Articles of Merger as filed with the New York Department of State on
February 11, 1994 (incorporated by reference to Exhibit 2.1 to report
on Form 8-K dated February 14, 1994).
2.02 Articles of Merger as filed with the Wyoming Secretary of State on
February 14, 1994 (incorporated by reference to Exhibit 2.2 to report
on Form 8-K dated February 14, 1994).
2.03 Agreement and Plan of Merger dated July 1, 1993 between the Company
and Mont Rouge Resources, Inc. (incorporated as Exhibit A to Exhibit
2.2 above).
3 Articles of Incorporation and Bylaws
3.01 Articles of Incorporation of Mont Rouge Resources, Inc. as filed with
the New York Department of State on March 19, 1987. (incorporated by
reference to Exhibit 3.1 to registration statement on Form S-1, File
No. 33-6343).
3.02 Articles of Amendment of American Digital Communications, Inc. as
filed with the Wyoming Secretary of State on September 7, 1999.
3.03 Articles of Incorporation of the Company, as filed with the Wyoming
Secretary of State on June 30, 1993 (incorporated by reference to
Exhibit 3.1 to report on Form 8-K dated July 14, 1993).
3.04 Bylaws of the Company (incorporated by reference to Exhibit 3.2 to
report on Form 8-K dated July 14, 1993). 4 Instruments Establishing
Rights of Security Holders
4.01 Specimen Stock Certificate of the Company (incorporated by reference
to Exhibit 4.1 to report on Form 8-K dated July 14, 1993.
4.02 Form of Warrant issued by Registrant to various investors, dated as of
April 17, 1998 (incorporated by reference to Exhibit 4.1 to report on
Form 8-K, dated May 7, 1998).
10 Material Contracts
10.01 1993 Incentive Stock Option Plan of the Company dated July 15, 1993
(incorporated by reference to Exhibit 10.1 to report on Form 8-K dated
July 14, 1993).
10.02 1993 Non-Statutory Stock Option Plan of the Company dated July 15,
1993 (incorporated by reference to Exhibit 10.2 to report in Form 8-K
dated July 14, 1993).
10.03 1993 Employee Stock Compensation Plan of the Company dated July 15,
1993 (incorporated by reference to Exhibit 10.3 to report on Form 8-K
dated July 14, 1993).
10.04 1993 Employee Stock Compensation Plan of the Company dated November 5,
1993 ( incorporated by reference to Exhibit 10.4 to report on Form 8-K
dated February 14, 1994).
10.05 Asset purchase agreement dated November 8, 1996 for the sale of
certain licensing rights, distribution rights, and right to acquire up
to $1,000,000 in certain inventory by and between Simmonds Capital
Limited, SCL Distributors (Western) Ltd., Midland International
Corporation, and American Digital Communications, Inc. (incorporated
by reference to Exhibit 10.41
14
<PAGE>
Exhibit Document
------- --------
10.06 Agreement, dated January 15, 1998, between Simmonds Capital Limited
and the Registrant (incorporated by reference to Exhibits 2 through
2.6 of the Registrant's Form 8-K, dated May 7, 1998).
10.07 Amended and Restated Global Secured Demand Promissory Note, dated July
28, 1998, in the principal amount of $850,000, issued by the
Registrant in favor of Pellinore, for itself and as agent for certain
investors (incorporated by reference to Exhibit 10.1 of the
Registrant's Form 8-K dated September 10, 1998).
10.08 Amended and Restated Pledge Agreement, dated July 28, 1998, between
the Registrant and Pellinore, for itself and as agent for certain
investors (incorporated by reference to Exhibit 10.2 of the
Registrant's Form 8-K dated September 10, 1998).
10.09 Placement Agent Agreement, dated July 28, 1998 between the Registrant
and Pellinore, for itself and as agent for certain investors
(incorporated by reference to Exhibit 1 of the Registrant's Form 8-K
dated September 10, 1998).
16 Letter on Change in Certifying Accountants
16.01 Letter of Causey, Demgen & Moore, dated March 24, 1998 (incorporated
by reference to Exhibit [____] to the Registrant's report on Form 8-K,
dated April 13, 1998).
16.02 Letter of Stark Tinter & Associates, LLC, dated May 13, 1998
(incorporated by reference to Exhibit 16 to the Registrant's report on
Form 8-K, dated May 22, 1998).
*27 Financial Data Schedule.
------------------
* Filed herewith.
(b) Reports on Form 8-K
None
(Remainder of page left intentionally blank)
15
<PAGE>
SIGNATURES
Pursuant to the registration requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereto duly authorized.
DATE: JULY 14, 2000 BY: /s/ John G. Simmonds
-----------------------------
John G. Simmonds
President / CEO / Director
(principal executive officer)
DATE: JULY 14, 2000 BY: /s/ Gary N. Hokkanen
-----------------------------
Gary N. Hokkanen
Chief Financial Officer,
(principal financial officer)
16
