UNITED STATES
SECURITY AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K SB
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
(Mark One)
(X)ANNUAL REPORT PURSUANT TO SECTION 12 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the year ended January 31, 1998
( )TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period
Commission File Number 000-18257
HOLMES MICROSYSTEMS, INC.
(Exact name of registrant as specified in its charter)
TEXAS 91-1939829
(State of Incorporation or Organization) (IRS Employer ID Number)
57 West 200 South, Suite 310, Salt Lake City, Utah 84101
(Address of Principal Executive Offices)
(801) 269-9500
(Registrant's Telephone Number)
Securities Registered Under Section 12 (b) of the Act:
None
(Title of Class)
Securities Registered Under Section 12 (g) of the Act:
Common Stock, $.001 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section `3 or `5(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
Indicate by check mark if disclosure of delinquent filers in response 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 III or any amendment to this Form
10-K. ( )
Issuer's revenues for the year ended January 31, 1998 were $-0-.
The aggregate market value based on the average bid and asked prices of
the registrant's Common Stock held by non-affiliates of the registrant at
March 24, 1999, was approximately $34,547. As of March 24, 1999, there were
48,051,547 shares of the registrant's Common Stock outstanding.<PAGE>PART I
Item 1 - BUSINESS
On April 4, 1989, Blackwing Corporation, a publicly held corporation, acquired
all of the issued and outstanding shares of a company known as Surface Tech,
Inc., which was originally known as Holmes Microsystems, Inc. The transaction
had been accounted for as a recapitalization of Holmes Microsystems, Inc. in a
manner similar to a reverse purchase. Accordingly, Holmes Microsystems, Inc.
has been treated as the surviving entity. As part of this transaction,
Blackwing Corporation changed its name to Holmes Microsystems Inc. and the
original Holmes Microsystems Inc., which was then a wholly owned subsidiary,
was liquidated.
Until the fiscal year ended January 31, 1994, the company had been engaged in
the sale of modems which provide data and facsimile capabilities for portable
computers. The company had used the trade name "FAX EM" as an overall
description of its products. As of the year ended January 31, 1994, the
company ceased all sales and operations and became totally inactive.
Item 2 - PROPERTIES
The registrant abandoned all leased facilities in 1993.
Item 3 - LEGAL PROCEEDINGS
There are twelve judgments against the registrant for a total of
$526,710.60
Item 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of the security holders during the fiscal
year ended January 31, 1998.
PART II
Item 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
The registrant's common stock is traded on the OTC - Bulletin Board (HOMM)
There is no established trading market for the stock. The following table
sets forth the high and low bid prices for the stock for the year ended
January 31, 1998 as reported by the market maker each quarter. These
quotations reflect inter-dealer prices, without retail markup, markdown or
commission, and may not represent actual transactions.
Item 5 - MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS (Continued)
FISCAL YEAR JANUARY 31, 1998
QUARTER LOW BID HIGH BID
February 1, 1997 to April 30, 1997 $ .01 $ .01
May 1, 1997 to July 31, 1997 $ .01 $ .01
August 1, 1997 to October 31, 1997 $ .01 $ .01
November 1, 1997 to January 31, 1998 $ .01 $ .01
As of January 31, 1998 there were 587 shareholders of the company's common
stock. No cash dividends were declared during the year ended January 31,
1998.
Item 6 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The company has been inactive since the fiscal year ended January 31, 1994.
As of January 31, 1998, the company had no assets. Total liabilities were
$610,711 as of January 31, 1998, of which $526,711 were in the form of
judgments and $84,000 were notes payable.
Item 7 - FINANCIAL STATEMENTS
The financial statements of the Company are set forth immediately following
the signature page of this annual report.
Item 8 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
None
PART III
Item 9 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Kip Eardley, 38, the sole director of the company, has been president of the
company since December 18, 1996. Mr. Eardley has been self-employed as a
consultant to various public and private companies since 1989. He performs
these services as president and owner of Capital Consulting of Utah, Inc.
There are no other officers of the registrant.
Section 16(a) Beneficial Ownership Reporting Compliance
For the fiscal year ended January 31,1998, the following are persons, who were
directors, officers, or beneficial owners of more than 10% of the Common Stock
during such fiscal year, and who failed to file on a timely basis reports
required by Section 16(a) of the Securities Exchange Act of 1934 during such
fiscal year or any prior fiscal year:
Number of
Transactions Not
Number of Reported on
Name Position Late Reports Timely Basis
Kip Eardley Director & Officer Two (Form 3 & 5)* One
Howard Oveson Beneficial Owner Two (Form 3 & 5)* One
*Neither of the referenced Form 3's or 5's have been filed.
Item 10 - EXECUTIVE COMPENSATION
None
Item 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth certain information furnished by current
management concerning the ownership of common stock of the Company as of June
3, 1999, of (i) each person who is known to the Company to be the beneficial
owner of more than 5 percent of the Common Stock; (ii) all directors and
executive officers; and (iii) directors and executive officers of the Company
as a group:
Amount and Nature
Name and Address of Beneficial Percent
of Beneficial Owner Ownership(1) of Class
Kip Eardley -0- -0-
5814 South 900 East
Salt Lake City, Utah 84117
Howard M. Oveson 30,778,149(2) 64.06%
57 West 200 South
Suite 310
Salt Lake City, Utah 84101
Marilyn Welch 3,147,100 6.55%
Las Vegas, Nevada
Executive Officers and -0- -0-
Directors as a Group (1 Person)
(1)Unless otherwise indicated, this column reflects amounts as to which the
beneficial owner has sole voting power and sole investment power.
(2) These shares are held directly by Milagro Holdings, Inc., a Delaware
corporation controlled by Mr. Oveson, and therefore Mr. Oveson is deemed to
share beneficial ownership of such shares with such entity.
Item 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None
Item 13 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K
(a)(1) Financial Statements. The following unaudited financial statements
are provided pursuant to Rule 3-11 of Regulation S-X:
Statement of Financial Position as of January 31, 1998 and 1997
Statement of Operations for the Years Ended January 31, 1998 and 1997
Statement of Changes in Stockholders' Equity for the Years Ended
January 31, 1998 and 1997
Statement of Cash Flows for the Years Ended January 31, 1998 and 1997
Notes to Financial Statements
(a)(2) Exhibits. The following exhibits are included as part of this
report:
Exhibit No. Description of Exhibit Page
3.1 Articles of Incorporation filed January 20, 1988 *
3.2 Articles of Amendment filed May 3, 1989 *
3.3 Articles of Amendment filed January 16, 1990 *
3.4 Statement of Resolution Establishing series of
Shares filed January 16, 1990 *
3.5 Statement of Resolution Establishing series of
Shares filed October 29, 1990 *
3.6 Statement of Resolution Establishing series of
Shares filed May 10, 1991 *
3.7 By-Laws of the Company currently in effect *
4.1 Form of certificate evidencing shares of Common Stock *
*Incorporated by reference from the Company's Form 10-K SB dated January
31, 1997.
Pursuant to the requirements of Section 13 of the Securities and Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Holmes Microsystems, Inc.
(Registrant)
Dated: By
Kip Eardley, President and CFO
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following person on behalf of the
registrant and in the capacity and on the date indicated.
Dated: By
Kip Eardley, Director
<PAGE>
HOLMES MICROSYSTEMS, INC.
Statement of Changes in Stockholders' Equity
(Unaudited) January 31, 1998 and 1997
ASSETS
January 31, January 31,
1998 1997
CURRENT ASSETS $ -0- $ -0-
TOTAL ASSETS $ -0- $ -0-
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Judgements payable (Note 2) $ 526,711 $ 526,711
Notes payable (Note 3) 84,000 84,000
Total current liabilities 610,711 610,711
STOCKHOLDERS' EQUITY
Preferred stock - series A; $.001
par value; 100,000 shares
authorized; 7,500 shares issued
and outstanding; 8 %
noncumlative convertible 8 8
Preferred stock - series B; $.001
par value; 5,000 shares
authorized; 840 shares issued
and outstanding; 10 %
cumlative convertible 1 1
Common stock; $.001 par value;
49,000,000 shares authorized;
48,051,547 shares issued and
outstanding 48,051 48,051
Additional paid-in capital 4,342,333 4,342,333
Accumulated deficit (5,001,104) (5,001,104)
Total stockholders' equity (610,711) (610,711)
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ -0- $ -0-
<PAGE>
HOLMES MICROSYSTEMS, INC.
Statement of Operations for the Years
(Unaudited) Ended January 31, 1998 and 1997
January 31, January 31,
1998 1997
REVENUES $ -0- $ -0-
OPERATING EXPENSES -0- -0-
NET INCOME $ -0- $ -0-
NET INCOME PER SHARE $ -0- $ -0-
<PAGE>
HOLMES MICROSYSTEMS, INC.
Statement of Changes in Stockholders' Equity
(Unaudited) For the Years Ended January 31, 1998 and 1997
Preferred Preferred
Stock Stock Additional
Series A Series B Common Stock Paid-in Accum.
Shares Amt. Shares Amt. Shares Amount Capital Deficit Total
Balance
as of
1/31/97 7,500 $8 840 $1 48,051,547 $48,051 $4,342,333 $(5,001,104) $(610,711)
Net
Income -0- -0-
Balance
as of
1/31/97 7,500 $8 840 $1 48,051,547 $48,051 $4,342,333 $(5,001,104) $(610,711)
Net
Income -0- -0-
Balance
as of
1/31/98 7,500 $8 840 $1 48,051,547 $48,051 $4,342,333 $(5,001,104) $(610,711)
<PAGE>
HOLMES MICROSYSTEMS, INC.
Statement of Cash Flows for the Years
(Unaudited) Ended January 31, 1998 and 1997
January 31, January 31,
1998 1997
CASH FLOWS FROM OPERATING
ACTIVITIES
Net Income $ -0- $ -0-
CASH AT BEGINNING OF YEAR -0- -0-
CASH AT END OF YEAR $ -0- $ -0-
<PAGE>
HOLMES MICROSYSTEMS, INC.
(Unaudited) Notes to Financial Statements
NOTE 1 ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
On April 4, 1989, Blackwing Corporation, a publicly held corporation, acquired
all of the issued and outstanding shares of a company known as Surface Tech,
Inc., which was originally known as Holmes Microsystems, Inc. This
transaction had been accounted for as a recapitalization of Holmes
Microsystems, Inc. as a reverse acquisition. Accordingly, Holmes
Microsystems, Inc. has been treated as the surviving entity. As part of this
transaction, Blackwing changed its name to Holmes Microsystems, Inc., and the
original Holmes Microsystems, Inc., which was then a wholly owned subsidiary,
was liquidated.
Earnings per share are computed on the weighted average number of shares
outstanding.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported assets and liabilities at the date of the financial
statements and the reported amount of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
NOTE 2 JUDGEMENTS PAYABLE
There are twelve judgements against the company (mostly vendors) for a total
of $526,711.
NOTE 3 NOTES PAYABLE
The company has the following outstanding notes payable:
Michael Perog $35,000
Julie Pierce 27,000
Ted Whitehead 22,000
Total $84,000
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JAN-31-1998
<PERIOD-END> JAN-31-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 610,711
<BONDS> 0
0
9
<COMMON> 48,051
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
