UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE
ACT OF 1934
For the Fiscal Year Ended January 31, 2000
or
|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND
EXCHANGE ACT OF 1934
For the transition period from _____________ to _____________
Commission File Number 1-10366
LASER RECORDING SYSTEMS, INC.
(Exact name of Registrant as specified in its Charter)
New Jersey 22-2582847
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1395 New York Avenue, Huntington Station, NY 11746
(Address of principal executive offices) (Zip Code)
(800) 786-1352
(Registrant's telephone number, including area code)
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE SECURITIES EXCHANGE ACT
OF 1934:
None
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE SECURITIES EXCHANGE ACT
OF 1934:
None
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 III of this Form 10-K or any amendment to this
Form 10-K. YES |X| NO |_|
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 |_|
<PAGE>
The aggregate market value of the voting stock held by non-affiliates of the
Registrant at January 31, 2000 was approximately $270,000.
The number of shares of Registrant's Common Stock outstanding on January 31,
2000 was 10,000,000.
Revenue for the most recent fiscal year was $0.
<PAGE>
Part I
Item 1. Business
The Company was incorporated in 1986 and completed an initial public offering of
its Common Stock in 1989. From the time of its incorporation until early 1993 it
was a developer and marketer of integrated optical disk-based imaging systems
and large network document management systems, which it marketed primarily to
the pharmaceutical industry in the United States and Europe and to users of
litigation support applications.
In 1993 the Company commenced an orderly winding up and liquidation of its
assets, which it completed substantially in 1994. It has been inactive since
that date, and has recently commenced searching for a merger with an operating
entity.
Employees
The Company's four officers are its only employees. Each of them has other
employment and devotes only such time to the Company's business as is necessary
for its limited operations.
Item 2. Properties
The Company maintains its principal executive offices at 1395 New York Avenue,
Huntington Station, NY, on a rent free basis pursuant to a verbal agreement with
Carl Lanzisera, its Chairman and principal shareholder.
Item 3. Legal Proceedings
None
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the last quarter
of the period covered by this report.
Part II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
The Company's Common Stock is traded in the over-the-counter market. The range
of high and low bid quotations, as reported by the National Quotation Bureau
Incorporated, for the Company's securities through the three months ended
January 31, 2000, is as follows:
<PAGE>
Common Stock Bid High Low
- ---------------- ----- ---
Three months ended
April 30, 1998 $.02 $.01
July 31, 1998 $.01 $.01
October 31, 1998 $.01 $.01
January 31, 1999 $.01 $.001
April 30, 1999 $.03125 $.01
July 31, 1999 $.03125 $.01
October 31, 1999 $.03125 $.015
January 31, 2000 $.12 $.011
The market for the Company's Common Stock is extremely thin, with actual
transactions occurring only sporadically. As of January 31, 2000, the
approximate number of holders of record of the Company's Common Stock was 750.
The Company has never paid cash dividends on its Common Stock. Payment of
dividends is within the sole discretion of the Company's Board of Directors and
depends, among other factors, on earnings, capital requirements and the
operating and financial condition of the Company.
Item 6. Selected Financial Data
The following selected financial data should be read in connection with the
Financial Statements and Notes thereto and "Management's Discussion and Analysis
of Financial Condition and Results of Operations" appearing elsewhere in this
report. Such data have been derived from the financial statements audited by
Tamas B. Revai, Certified Public Accountant.
<TABLE>
<CAPTION>
Fiscal Year Ended January 31
----------------------------
1996(1) 1997 1998 1999 2000
------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C>
Operating revenues -- -- -- --
Income (loss) from
continuing operations 1,839 (529) (2,218) (4,014)
Income (loss) from
continuing operations per
common share -- -- -- --
Total assets 13,245 13,656 10,498 6,634
Long-term obligations and
redeemable preferred stock -- -- -- -- --
Cash dividends declared per
common share -- -- -- -- --
</TABLE>
<PAGE>
(1) Financial statements were not prepared for the fiscal years ended January
31, 1996 because the Company had no operations during those years. See Notes to
Financial Statements included elsewhere in this Report.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
The Company has no sources of revenue. Expenses reflect only the minimum cost of
maintaining the Company's operations and miscellaneous expenses associated with
seeking a merger partner. In view of these limited operations, management does
not believe that a comparison of specific line items from period to period it
would be meaningful.
Liquidity and Capital Resources
The Company's financial statements have been prepared assuming that it will
continue as a going concern. As shown in the consolidated financial statements,
at January 31, 2000 the Company had total assets of $6,634 and an accumulated
deficit of $7,402,426. The Company obtains its entire financial support from
loans from the Company's majority shareholder, and it is likely that additional
loans from that shareholder will be necessary if the Company is to pursue its
plans to merge with an operating enterprise. These factors, among other things,
raise substantial doubt about its ability to continue as a going concern. The
consolidated financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts or
classification of liabilities that might be necessary should the Company be
unable to continue in operation.
Item 7A. Qutative and Qualitative Disclosures About Market Risk
Not applicable
Item 8. Financial Statements and Supplementary Data.
<PAGE>
TAMAS B. REVAI
CERTIFIED PUBLIC ACCOUNTANT
CERTIFIED VALUATION ANALYST
6812 FORT HAMILTON PARKWAY, BROOKLYN, NY 11219
(718) 833-0982 Fax: (718) 833-3658
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
and Stockholder of
Laser Recording Systems, Inc.
We have audited the accompanying balance sheets of Laser Recording Systems, Inc.
as of January 31, 2000, January 31, 1999, January 31, 1998 and the related
statements of income, retained earnings, and cash flows for the years then
ended. 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 the 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 Laser Recording Systems, Inc.
as of January 31, 2000, 1999, 1998 and the results of its operations and its
cash flows for the years then ended in conformity with generally accepted
accounting principles.
As we discussed in Note 2 to the financial statements, the Company discontinued
operation in 1993 and liquidated most of its assets. As a result, all revenues
and expenses were classified as non-operating items for the years of February 1
1994 to January 31, 2000.
Tamas B. Revai
Certified Public Accountant
Brooklyn, New York
April 18, 2000
<PAGE>
LASER RECORDING SYSTEMS, INC.
BALANCE SHEET
January 31,
ASSETS
2000 1999 1998
CURRENT ASSETS:
Cash and Cash Equivalents $ 6,634 $ 10,498 $ 44,846
----------- ----------- -----------
Total Current Assets $ 6,634 $ 10,498 $ 13,656
----------- ----------- -----------
Total Assets $ 6,634 $ 10,498 $ 13,656
----------- ----------- -----------
LIABILITIES and STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accrued Expenses $ 150 -0- $ 44,846
----------- ----------- -----------
Total Current Liabilities $ 150 -0- $ 44,846
----------- ----------- -----------
Loans Payable - Stockholder -0- -0- $ 190,000
----------- ----------- -----------
Total Liabilities $ 150 $-0- $ 234,846
----------- ----------- -----------
Stockholders' Equity:
Preferred Stocks - 2,200,729
Preferred Shares; 225,321
Class B Cumulative Preferred
Shares; 1,080,000 Class C
Cumulative Convertible
Preferred Shares issued and
outstanding on January 31,
1998 $ 2,507,364
Common Stocks - 10,000,000
shares authorized, 10,000,000
issued and outstanding on
January 31, 2000 7,800,000
issued and outstanding on
January 31, 1999; 4,798,815
issued and outstanding on
January 31, 1998 $ 7,408,910 $ 7,408,910 $ 4,574,865
Paid in Capital $ 92,775
Retained Earnings (7,402,426) (7,398,412) (7,396,194)
----------- ----------- -----------
Total Stockholders'
Equity $ 6,484 $ 10,498 $ (221,190)
----------- ----------- -----------
Total Liabilities and
Stockholders' Equity $ 6,634 $ 10,498 $ 13,656
----------- ----------- -----------
The accompanying notes are an integral part of the financial statements.
<PAGE>
LASER RECORDING SYSTEMS, INC.
STATEMENT OF REVENUES, EXPENSES AND RETAINED EARNINGS
For the Year Ended
January 31,
2000 1999 1998
Revenue:
Interest Income $ 127 $ 123 $ 120
----------- ----------- -----------
Total Revenues $ 127 $ 123 $ 120
----------- ----------- -----------
Expenses:
Administrative Expenses 4,141 2,341 649
----------- ----------- -----------
Total Expenses 4,141 2,341 649
----------- ----------- -----------
Net Income (4,014) (2,218) (529
----------- ----------- -----------
Retained Earnings at
Beginning of Year (7,398,412) (7,396,194) (7,395,665)
----------- ----------- -----------
Retained Earnings at End
of Year $(7,402,426) $(7,398,412) $(7,396,194)
----------- ----------- -----------
The accompanying notes are an integral part of the financial statements.
<PAGE>
LASER RECORDING SYSTEMS, INC
STATEMENT OF CASH FLOWS
For the Year Ended
January 31,
2000 1999 1998
Cash flows from operating activities:
Net Income $ -0- $ -0- $ -0-
-------- -------- --------
Cash flows from financing
activities:
Maintaining of the Corporate
Entity $ (3,864) $(3158) $ 411
-------- -------- --------
Net cash provided by (used in)
financing activities $ (3,864) $(3158) $ 411
-------- -------- --------
Increase (Decrease) in Cash $ (3,864) $(3158) $ 411
-------- -------- --------
Cash - Beginning of year $ 10,498 $ 13,656 $ 13,245
-------- -------- --------
Cash -End of Year $ 6,634 $ 10,498 $ 13,656
-------- -------- --------
The accompanying notes are an integral part of the financial statements.
<PAGE>
LASER RECORDING SYSTEMS, INC.
ANALYSIS OF STOCKHOLDERS' EQUITY
January 31,
2000 1999 1998
----------- ----------- -----------
Preferred Stocks - 2,200,729 2,507,364
Preferred shares: 225,321
Class B Cumulative
Preferred Shares; 1,080,000
Class C
Cumulative Convertible
Preferred Shares issued and
outstanding
Paid in Capital 92,775
4,798,815 shares Common
Stock issued and outstanding 4,574,865
Conversion of all Preferred
Stocks to Common Stocks 2,507,364
Conversion of Liabilities
to Common Stocks 233,906
Conversion of Paid in
Capital to Common Stock 92,775
Common Stocks at the
beginning of year 7,408,910 4,574,865
----------- -----------
7,800,000 shares Common
Stock issued and outstanding 7,408,910
-----------
2,200,000 shares Common
Stock issued -0-
-----------
10,000,000 shares Common
Sock issued and outstanding 7,408,910
-----------
Retained Earnings at the
beginning of the year (7,398,412) (7,396,194) (7,395,665)
Net Income/(Loss) (4014) (2,218) (529)
----------- ----------- -----------
Retained Earnings at the
end of the year (7,402,426) 7,398,412) $(7,396,194)
----------- ----------- -----------
Total Stockholders' Equity 6,484 10,498 (221,190)
----------- ----------- -----------
The accompanying notes are an integral part of the financial statements.
<PAGE>
LASER RECORDING SYSTEMS, INC.
NOTES TO FINANCIAL STATEMENTS
January 31, 2000, 1999 and 1998
GENERAL
Laser Recording Systems, Inc. (the Company) was organized in 1985 as the
successor to several other businesses by the original founder. In 1988 Poly
Ventures, Limited Partnership held approximately 70% of the outstanding voting
shares and maintained a controlling interest in the Company until 1998. In 1998
several investors acquired the remaining interest from Poly Ventures.
As reported in form 10-Q, on October 31st 1993, the Company ceased operations
and laid off all its employees on August 16th 1993. The Company handed over
projects to their customers on that date. From October 31st 1993 to January 7,
2000, the Company did not file any reports with the Securities and Exchange
Commission. On January 7, 2000 the Company filed Form 10-K for January 31, 1999
and the required Forms 10-Q for the following quarters.
BASIS OF PRESENTATION
The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles and reflect all adjustments, which in
the opinion of management are necessary for a fair presentation of the result
for the periods shown. The result of operations for such periods are not
necessarily indicative of the results expected for the full fiscal year or for
any future period.
Note 1.
In 1998 several investors purchased from Poly Ventures 1,975,408 Common Shares,
2,200,729 Preferred Shares, 225,321 Class B Cumulative Preferred Shares and
1,080,000 Class C Cumulative Preferred Shares. Included in the purchase were two
notes for the total of $190,000.
In 1999 all classes of the preferred shares, accrued dividend and interest, paid
in capital and loans payable were converted to capital stock. As a result the
Company's board of Directors on January 15, 1999 authorized issuing 3,001,185
Common Shares for all liabilities and preferred stocks. In lieu of compensation,
the board of directors authorized issuing additional shares to the officers of
the company. As of the date of the financial statements all 10,000,000 shares of
the company were issued and outstanding. In addition, the officers received
1,200,000 warrants for future services. If the warrants will be exercised, the
Company will have to buy back its stock on the open market.
Note 2.
The Company discontinued operation on August 16th 1993, however the Company
maintained certain functions to continue the existence of the corporation.
Stockholders services and maintaining of records were handled on an ongoing
basis. In 1999, the Company filed all necessary tax returns for the years of
February 1, 1993 to January 31, 1999. For financial statement purposes all
revenues and expenses are considered non-operating transactions from February 1,
1994 to the present.
<PAGE>
Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure
Not applicable
PART III
Item 10. Directors and Executive Officers of the Registrant
The directors and executive officers of the Company are as follows:
Name Age Position
- ---- --- --------
Carl Lanzisera 61 Chairman of the Board, Treasurer and
Director
Walter J. Hinchcliffe 68 President and Director
Carrie Niemiera 38 Secretary and Director
Harvey Kash 66 Director
Carl Lanzisera has for the last year been the President of Federated Securities,
Inc., a registered broker-dealer. From 1997 to 1998 he was branch manager of an
independent office of First Securities, Inc. Prior to that he was branch manager
of an independent office of Myers Pollack & Robbins Securities. He has been
registered with the NASD for more than 35 years and has been a registered
securities principle for 25 years. He holds a M.S degree in business from
Adelphi University.
Walter J. Hinchcliffe is and has been since 1976 a principal in the management
consulting firm Reed Wilson & Company. He holds a B.B.A. degree in marketing and
retailing.
Carrie Niemiera has been a building manager of a commercial office building in
Melville, NY since 1989.
Harvey Kash was the President and founder of a Mineola NY consumer advisory
service from 1992 until he joined the Company. From 1984 to 1991 he was the
President and they co-founder of DKS Sales, Inc. a full-service manufacturer's
representative in the areas of housework, hardware, lawn and garden furniture.
He holds a BBA from the Baruch School of Business of the City University of New
York.
The above officers and directors serve for a term of one year or until their
successors have been elected.
Each of the Company's officers and directors holds other employment and is
devoting only such time to the operation of the Company's business as its
limited operations require.
Item 11. Executive Compensation
In November, 1997 the Board of Directors authorized the issuance of 1,100,000
shares of the Company's Common Stock to Mr. Lanzisera, 500,000 shares of the
Company's Common Stock to Mr. Hinchcliffe and 300,000 shares of such Common
Stock to each of Mr. Kash and Ms. Niemiera. For the year ended January 31, 1999
no executive officers or directors of the Company
<PAGE>
were paid or accrued any additional remuneration. However, the Board of
Directors has authorized the issuance of warrants to each of Messrs. Lanzisera
and Hinchcliffe, Ms. Neimiera and Mr. Kash to purchase 300,000 shares, also upon
activation of the Company.
No compensation has been or will be paid on account of services rendered by a
director in such a capacity other than for the reasonable expenses incurred in
connection with the Company's business.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The following table sets forth as of January 31, 1999, certain information with
respect to the beneficial ownership of shares of Common Stock of (i) all
shareholders known by the Company to be the beneficial owners of more than 5% of
its outstanding Common Stock, and (ii) each director of the Company and each
executive officer of the Company and (iii) all directors and executive officers
of the Company has a group. The beneficial ownership is determined in accordance
with the rules of the Securities and Exchange Commission and includes voting and
investment power with respect to shares.
Name and Address of Beneficial Owner(1) Shares Beneficially Owned
- --------------------------------------- -------------------------
Number Percent
------ -------
Carl Lanzisera (2) 6,376,593 69.3%
Walter J. Hinchcliffe (3) 800,000 7.8%
Carrie Neiviera (4) 600,000 5.8%
Harvey Kash (5) 600,000 5.8%
All current directors and executive
officers as a group (4 persons) 8,376,593 74.8%
(1) Except as otherwise indicated, (i) the shareholders named in the table have
sole voting and investment power with respect to all shares beneficially owned
by them and (ii) the address of all shareholders listed in the table is c/o
Laser Recording Systems, Inc., PO Box 214, Huntington Station, NY 11746
(2) Includes 6,076,593 shares held by Mr. Lanzisera, and a warrant to purchase
an additional 300,000 shares exercisable within 60 days.
(3) Includes 500,000 shares and a warrant to purchase an additional 300,000
shares exercisable within 60 days.
(4) Includes 300,000 shares and a warrant to purchase an additional 300,000
shares exercisable within 60 days.
(5) Includes 300,000 shares and a warrant to purchase an additional 300,000
shares exercisable within 60 days.
Item 13. Certain Relationships and Related Transactions
<PAGE>
The Company occupies its principal executive offices on a month to month basis,
free of charge, from its Chairman.
Part IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8K
The Company has not filed any reports on Form 8-K during the last quarter of the
period covered by this report.
All other schedules required by Regulation S-K are omitted because they are not
applicable or the required information is included in the financial statements
or the notes thereto.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
LASER RECORDING SYSTEMS, INC.
(Registrant)
By: /s/ Walter Hinchcliffe
----------------------------------
Walter Hinchcliffe, President
Dated April 28, 2000
Pursuant to the requirements of the Securities Act of 1934, this report has been
signed below by the following persons on behalf of the Registrant and in the
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Carl Lanzisera Chairman of the Board, Treasurer April 28, 2000
- ------------------------ and Director
Carl Lanzisera
/s/ Walter Hinchcliffe President and Director April 28, 2000
- ------------------------
Walter Hinchcliffe
<PAGE>
/s/ Harvey Kash Director April 28, 2000
- ------------------------
Harvey Kash
/s/ Carrie Niemiera Secretary and Director April 28, 2000
- ------------------------
Carrie Niemiera
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JAN-31-2000
<PERIOD-START> FEB-01-1998
<PERIOD-END> JAN-31-1999
<CASH> 6,634
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 6,634
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 6,634
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<BONDS> 0
0
0
<COMMON> 7,408,910
<OTHER-SE> (7,402,426)
<TOTAL-LIABILITY-AND-EQUITY> 6,635
<SALES> 0
<TOTAL-REVENUES> 127
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 4,141
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (4,014)
<INCOME-TAX> 0
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<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,014)
<EPS-BASIC> 0
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</TABLE>
