FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: August 10, 2000
RETURN ON INVESTMENT CORPORATION
Delaware 033-36198 22-3038309
1825 Barrett Lakes Blvd., Suite 260, Kennesaw, Georgia 30144
770-517-4750
FORMERLY NET/TECH INTERNATIONAL, INC.
Former address: 1 West Front Street, Suite 30, Red Bank, NJ 07701
ITEM 1 CHANGES IN CONTROL OF REGISTRANT
Return On Investment Corporation ("the Company"), formerly Net/Tech
International, Inc., experienced a change of control as a result of the
acquisition of Results Oriented Integration Corporation ("ROI") on August 10,
2000.
PERSONS WHO ACQUIRED CONTROL
--------------------------------------------------------------------------------
TITLE OF NAME AND ADDRESS OF BENEFICIAL OWNER AMOUNT OF % OF
CLASS BENEFICIAL CLASS
OWNERSHIP
--------------------------------------------------------------------------------
Common Charles A. McRoberts, 1825 Barrett 2,456,867 26.9
Lakes Blvd., Suite 260, Kennesaw, GA
30144 (Note 1)
--------------------------------------------------------------------------------
Common Charles Pecchio Jr., 1825 Barrett 2,021,481 22.1
Lakes Blvd., Suite 260, Kennesaw, GA
30144 (Note 2)
--------------------------------------------------------------------------------
Common John W. McRoberts, 1825 Barrett Lakes 1,488,740 16.3
Blvd., Suite 260, Kennesaw, GA
30144 (Note 3)
--------------------------------------------------------------------------------
Common ROI GROUP (Note 4) 5,967,088 65.3
--------------------------------------------------------------------------------
(Note 1) Includes 1,553,485 shares held in escrow. Consideration used in
acquiring beneficial shares was an exchange of an equivalent amount of Results
Oriented Integration Corporation common stock pursuant to the Plan of Merger.
(Note 2) Includes 1,271,033 shares held in escrow. Consideration used in
acquiring beneficial shares was an exchange of an equivalent amount of Results
Oriented Integration Corporation common stock.
(Note 3) Includes 941,412 shares held in escrow. Consideration used in acquiring
beneficial shares was an exchange of an equivalent amount of Results Oriented
Integration Corporation common stock.
(Note 4) Amount of ownership held by all three persons (1)(2)(3).
PERSONS FROM WHOM CONTROL WAS ASSUMED
--------------------------------------------------------------------------------
TITLE OF NAME AND ADDRESS OF BENEFICIAL OWNER AMOUNT OF % OF
CLASS BENEFICIAL CLASS
OWNERSHIP
--------------------------------------------------------------------------------
Common Glenn E. Cohen, 185 Route 36, West Long 1,763,333 16.0
Branch, NJ 07764
--------------------------------------------------------------------------------
Common Cryo-Cell International, Inc., 185 1,557,711 16.0
Route 36, West Long Branch, NJ 07764
--------------------------------------------------------------------------------
Common Paul W. Enoch, Jr., 185 Route 36, West 1,400,000 13.0
Long Branch, NJ 07764
--------------------------------------------------------------------------------
<PAGE>
TERMS OF PLEDGES OBTAINED BY THE NEW CONTROL GROUP FOR THE PURPOSES OF ACQUIRING
CONTROL
The Company pledged, pursuant to the Plan of Merger included as an exhibit in
this document, to acquire ROI and effect a stock swap at the close of the
acquisition. In order to complete the acquisition, the following actions, after
approval by a vote of the shareholders at the Special Meeting held on July 26,
2000, were taken: the issuance of shares of the Company's Common Stock to be
exchanged for the common stock of ROI; the Company's name will be changed; an
increase in the number of authorized shares of the Company's Common Stock; a
reverse split of the Company's Common Stock; issuance of shares of Common Stock
in lieu of payment of debt; a private offering of the Company's Common Stock;
and institution of an incentive stock option plan for the Company's Common
Stock.
The Company must issue (after the reverse split) a total of 6,118,918 shares of
Common Stock, par value $.01 per share, to be exchanged for all of the issued
and outstanding shares of common stock of ROI. These shares will not be
registered under the Securities Act of 1933, as amended, and must be held for a
minimum of two years. 2,352,988 of these shares will be delivered at closing and
3,765,930 of these shares will be held in escrow, with a portion released each
year at the rate of one share for each $2.40 of the Company's Net Income Before
Income Taxes ("NIBIT") for the fiscal years ending in 2000, 2001, 2002, 2003,
2004, and 2005. If the cumulative total NIBIT reaches $9,038,232.00, then all of
the escrowed shares will have been released. Each year's released shares must be
held for a minimum of one year. Except for the minimum holding period, all of
these shares are subject to piggyback registration rights which will enable the
holder of such shares to have such shares registered along with any possible
future registration of shares of the Company.
ITEM 2 ACQUISITION OF ASSETS
DESCRIPTION OF ASSETS
On August 10, 2000, the Company acquired ROI. The Company conducted a private
placement to raise capital and effected a stock swap as consideration for the
merger. The terms of the merger were negotiated at arms length and agreed to by
the directors and shareholders of the corporation. The Company obtained ROI and
all its assets in exchange for the consideration given. The funds for the merger
consisted of the Company's common stock exchanged for all outstanding shares of
ROI stock.
NATURE OF ASSETS
ROI markets software that processes electronic payment transactions for
companies selling through Internet e-commerce, retail outlets, and mail order
call centers. ROI's primary software is "e-transaction middleware" that is
certified to provide access to credit card and check authorization networks for
application software from companies like Binary Tree, Computer Associates, J.D.
Edwards, Friedman Corporation, HarrisData, Intentia, LANSA, VAI, and dozens
more. ROI customers range from small to large Internet marketers and retailers,
including companies such as Alltel, Brunswick, 800.com, IBM, and Skytel.
ROI currently provides credit card processing software only for IBM AS/400
computer systems in the United States. The Company intends to contiue to market
the software to the IBM AS/400 marketplace in the United States. The Company
intends to use some of the capital provided from the private placement offering
acquisition to pay off existing debt and to develop versions of ROI software for
other computer systems, such as Unix, Linux, and Windows systems. The Company
also intends to expand internationally and to pursue acquisitions of other
software companies whose products are complementary to ROI's.
ITEM 5 OTHER EVENTS
The Company changed its name to Return On Investment Corporation on August 10,
2000.
2
<PAGE>
ITEM 7 FINANCIAL STATEMENTS AND EXHIBITS
FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
It is impracticable to provide the required financial statements for Results
Oriented Integration Corporation ("ROI"), the business acquired by the Company
in the merger of August, 10, 2000. The audited financial numbers for ROI are not
yet available. Such required financial statements as are available have been
filed with this document. The required financial statements will be filed as an
amendment to this Form as soon as practicable, but not later than 60 days after
this report is filed. Unaudited financial statements for the acquired company,
ROI, have been included with this Form filing.
3
<PAGE>
RESULTS ORIENTED INTEGRATION CORPORATION
----------------------------------------
BALANCE SHEETS
JUNE 30, 1999 AND 2000
Assets 1,999 2,000
Current Assets:
Cash (62,409) 28,568
Other Current Assets -- 161,173
Accounts Receivable 400,322 845,482
-----------------------------
337,913 874,050
Property and Equipment net of
Accumulated Depreciation of
$162,670 and $365,134 874,717 707,685
-----------------------------
1,212,630 1,581,735
=============================
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable 50,611 302,284
Deferred Revenue 179,277 523,062
Notes Payable - Current 220,944 405,209
-----------------------------
Total Current Liablities 450,832 1,230,555
Notes Payable - Long Term 700,605 522,817
-----------------------------
Total Liabilities 1,151,437 1,753,372
-----------------------------
Stockholders' Equity
Common Stock (10,000,000 shares 1,333 5,039
authorized, 5,333,200 issued and outstanding
in 1999 and 6,118,917 issued and outstanding
in 2000)
Retained Earnings 59,860 (176,676)
-----------------------------
Total Stockholders' Equity 61,193 (171,637)
-----------------------------
1,212,630 1,581,735
=============================
4
<PAGE>
RESULTS ORIENTED INTEGRATION CORPORATION
----------------------------------------
Statement of Income
For the years ending June 30, 1999 and 2000
1999 2000
Revenue
Sales - License Fees $ 976,038 1,802,568
Sales - Support and Update Service 273,324 594,131
Sales - Other 56,011 28,566
----------------------------
1,305,373 2,425,265
----------------------------
Expenses
Wages & Salaries 498,224 1,253,826
Commissions and Contract Services 129,403 380,860
Royalties 138,277 64,698
Supplies 109,044 146,065
Advertising and Promotion 14,921 286,712
Employee Benefits 74,812 69,071
Rent and Occupancy 23,840 42,271
Depreciation 106,883 207,464
Telecommunications 36,150 52,908
Travel 40,218 24,633
Interest (net) 57,837 85,052
Other General & Administrative 22,914 48,241
----------------------------
Total Operating Expenses 1,252,523 2,661,801
----------------------------
Net Income (Loss) Before Income Taxes 52,850 (236,536)
Income Tax Expense --
----------------------------
Net Income 52,850 (236,536)
============================
5
<PAGE>
RESULTS ORIENTED INTEGRATION CORPORATION
----------------------------------------
Statement of Cash Flows
For the Years ending June 30, 1999 and 2000
1999 2000
Cash Flows from Operating Activities
Net (Loss) Income 2,850 (236,536)
Adjustments to reconcile net income to
net cash provided by operating
activiities
Depreciation 106,883 202,464
(Increase) decrease in:
Accounts Receivable (290,194) (445,160)
(Decrease) Increase in:
Accounts payable 50,611 251,673
Deferred Revenue 179,277 343,785
Other Payables -- --
Deferred Taxes -- --
-----------------------------
Net Cash Provided by Opereating Activities 49,427 116,226
-----------------------------
Cash Flows for Investing Activities
Purchase of Equipment and Software (900,000) (35,432)
-----------------------------
Cash Flows from Financing Activities
Issuance of Common Stock 833 3,706
Proceeds of Debt (net) 791,884 6,477
-----------------------------
Repayment of Debt
Net Cash Provided from Financing Activities 792,717 10,183
-----------------------------
Net Change in Cash (57,856) 90,977
Cash at beginning of year (4,553) (62,409)
-----------------------------
Cash at end of year (62,409) 28,568
=============================
Supplemental Disclosures
Operating activities reflect interest paid of $57,943 in 1999 and
$85,052 in 2000.
6
<PAGE>
RESULTS ORIENTED INTEGRATION CORPORATION
----------------------------------------
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For the Years ending June 30, 1999 and 2000
Common Stock Retained
Shares Amount Earnings Total
Balance July 1, 1998 5,333,200 1,333 57,010 58,343
Net Loss 2,850 2,850
-----------------------------------------------------
Balance June 30, 1999 5,333,200 1,333 59,860 61,193
Issue of Common Stock 785,717 3,706 3,706
Net Income (236,536) (236,536)
-----------------------------------------------------
Balance June 30, 2000 6,118,917 5,039 (176,676) (171,637)
=====================================================
7
<PAGE>
PRO FORMA FINANCIAL INFORMATION
Results Oriented Integration Corporation
Consolidated Pro Forma Condensed Balance Sheets
June 30, 1999 June 30, 2000
Assets:
Cash $ (58,978) $ 28,568
Accounts Receivable 400,322 684,309
Other Current Assets -- 161,172
-----------------------------
341,344 874,049
-----------------------------
Equipment 1,037,387 1,072,819
Accumulated Depreciation (162,670) (365,134)
-----------------------------
874,717 707,685
-----------------------------
$ 1,216,061 $ 1,581,734
=============================
Liabilities and Stockholders' Equity (Deficit)
Liabilities:
Accounts Payable $ 92,015 $ 447,959
Deferred Revenue 179,277 523,062
Notes Payable - Current 179,540 405,209
-----------------------------
450,832 1,376,230
Notes Payable Long Term 700,605 522,817
-----------------------------
1,151,437 1,899,047
-----------------------------
Stockholders' Equity (Deficit)
Common Stock 98,920 102,626
Retained Earnings (Deficit) (34,296) (419,939)
-----------------------------
64,624 (317,313)
-----------------------------
$ 1,216,061 1,581,734
=============================
Results Oriented Integration Corporation
Consolidated Pro Forma Condensed Income Statements
Year Ending Year Ending
June 30, 1999 June 30, 2000
Sales $ 1,389,373 $ 2,509,265
Royalties, Materials, and Supplies 138,277 146,061
Wages & Salaries 498,224 1,253,826
Advertising and Promotion 14,921 286,712
Consulting Fee 50,000 --
Commissions and Contract Services 129,403 280,860
Depreciation 127,302 208,714
Employee Benefits 74,812 69,072
Rent and Occupancy 23,840 42,270
Supplies 109,044 104,345
Telecommunications 36,150 52,908
Travel 40,218 24,633
interest Income (106) (1,013)
Interest Expense 57,943 86,065
Other General & Administrative 147,251 340,455
-----------------------------
1,447,279 2,894,908
-----------------------------
Net Loss $ (57,906) $ (385,643)
=============================
8
