CONFORMED COPY
FORM 10-K SB
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) 15, ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended June 30, 1996
OR
( ) 15, TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number: 33-37513-D
FI-TEK VI, INC.
______________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 84-1148204
______________________________ __________________________________
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
3127 Ramshorn Drive, Castle Rock, Colorado 80104
_________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(303) 660-1710
_________________________________________________________________________
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
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 such shorter
period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for at least the past 90
days.
Yes X No
--- ---
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 SB or any amendment to this form 10-K SB.
Yes X No
--- ---
As of August 31, 1996, the aggregate value of the 12,142,500 shares
of voting stock held by non-affiliates of the registrant was $242,850.
The number of shares outstanding of the registrant's only class of
common stock, as of August 31, 1996, was 29,042,500.
Registration Statement 33-37513-D, as amended, is incorporated into
Part I of this Report.
Exhibit Index is located at Page 11.
<PAGE>
PART I
ITEM 1. BUSINESS
General
Fi-Tek VI, Inc. (the "Registrant" or the "Company") was incorporated
under the laws of the State of Delaware on July 12, 1990, for the primary
purpose of seeking out acquisitions of properties, businesses, or merger
candidates, without limitation as to the nature of the business
operations or geographic area of the acquisition candidate. From
inception through October 1992, the Company's activities were directed
primarily toward the obtaining of capital with which to pursue the
business plan summarized in the preceding sentence.
In its effort to obtain capital, the Company commenced the initial
public offering of its securities on April 14, 1992. The offering was
designed to raise gross proceeds of up to $400,000 upon the sale of up
to 20,000,000 units of the Company's securities. In October 1992, the
Company completed its public offering of securities, receiving gross
proceeds of $160,850 from the sale of 8,042,500 units of the Company's
securities, such units (the "Units") consisting of common stock and
common stock purchase warrants. The underwriter of the Company's public
offering, pursuant to the Underwriting Agreement, purchased a warrant to
purchase 804,250 Units of the Company's securities for the nominal
amount of $40. The Company's "blind pool" offering was not required to
be conducted in accordance with the Securities and Exchange Commission's
Rule 419, which was adopted to strengthen the regulation of securities
offerings by "blank check" or "blind pool" companies, solely because the
Company's registration statement went effective prior to the effective
date of Rule 419. Notwithstanding the inapplicability of SEC Rule 419,
the Company's offering was subject to the Colorado
Securities Act, which required the placement into escrow of eighty
percent of the net proceeds of the offering (or $93,714) until the
completion of a transaction or series of transactions whereby at least
fifty percent of the gross proceeds received from the sale of shares in
the offering is committed for use in one or more specific lines of
business. The Company opened the required escrow account immediately
following the closing of the offering.
Pursuant to the escrow agreement, the escrow could not, in any event,
be extended beyond the fourth anniversary of the date of the Company's
prospectus, or April 14, 1996. Unless the condition precedent to the
distribution of the escrowed funds to the Company was satisfied prior to
such fourth anniversary, the funds would be distributed pro rata to the
persons who then held the shares issued pursuant to the offering.
Should a distribution of the escrowed funds be made to stockholders
as described above, only a portion of the funds originally invested
would be distributed to the persons then holding shares issued in this
offering, and no interest would be paid upon those funds. A distribution
of escrowed funds has no effect upon the ownership of the shares
issued in the offering, i.e., stockholders who receive their pro rata
portion of the distribution shall not be required to return any of the
securities to the Company's treasury.
The escrow condition had not been satisfied as of the fourth
anniversary, or by April 14, 1996, and, accordingly, the Company
distributed those funds pro rata to those persons who were owners of the
shares of common stock purchased in the offering.
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After completion of the offering, the Company began the process of
identification and evaluation of prospective acquisition candidates,
which process has included the solicitation of information from a
variety of sources within the general financial community as well as
from contacts established by management. This process is more fully
described in the Company's Prospectus, dated April 14, 1992, which
Prospectus is incorporated herein by this reference. The Company has
not yet entered into any letters of intent or binding agreements with
acquisition candidates and, therefore, the condition precedent to
release of the escrowed funds has not as of the date of this report been
satisfied.
Employees
The Company has no full time employees. Its executive officers
devote as much time as is necessary to conduct the Company's business.
See "Item 10. Executive Compensation."
ITEM 2. PROPERTIES
The Company has been provided office space in the home of its
President. The Company pays no rent for such space.
ITEM 3. LEGAL PROCEEDINGS
The Company is not party to any threatened or pending legal
proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the
fourth quarter of the fiscal year ended June 30, 1996.
PART II
ITEM 5. MARKET FOR THE COMPANY'S COMMON STOCK AND RELATED STOCKHOLDER
MATTERS
The Company's common stock began trading on the NASD's Bulletin Board
during the third quarter of fiscal 1994. According to the only firm currently
making a market in the Company's securities, both the high and low bid during
each fiscal quarter since commencement of trading has remained at $.01
per share of common stock.
At August 31, 1996, the Company had approximately 50 shareholders of
record. The Company has not paid any dividends on its common stock and
does not expect to pay a cash dividend in the foreseeable future.
3
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ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
The Company completed the initial public offering of its securities
in October of 1992, receiving gross proceeds of $160,890 (including
proceeds from the sale of warrants to the underwriter of the offering).
Total costs of the offering amounted to $46,657. The net proceeds of
the offering, therefore, amounted to $114,233. Pursuant to the Colorado
Securities Act and based upon actual and estimated offering costs,
$93,714 of that amount was deposited into escrow. This escrowed amount
was refunded, by law, effective as of the date of the fourth anniversary
for the prospectus (April 14, 1996), since the Company failed to identify a
suitable business acquisition during the four year period after its public
offering. At June 30, 1996, the Company had total liquid capital resources
(cash) of $18,216.
Management anticipates that the Company's current liquid capital
resources will be applied in the coming twelve months to three purposes.
The first purpose will be to meet the Company's reporting obligations
under the Securities Exchange Act of 1934, as amended. The second
purpose will be to cover general and administrative expenses. The third
purpose will be to cover the expenses associated with searching for and
investigating business opportunities. The Company anticipates that its
current resources will be adequate for those purposes for at least the
coming year.
The Company had not, as of the fourth anniversary of the effective
date of the prospectus (April 14, 1996), entered into any arrangement
that would satisfy the conditions to the release of the escrowed funds.
Accordingly, management has distributed the escrowed funds to the holder
of shares on a pro rata basis.
Except as described in the preceding paragraph, the Company
anticipates that its capital needs will be minimal until it shall have
identified a business opportunity with which to combine. In pursuing a
combination transaction, the Company is likely to incur significant
additional expenses. The Company expects to meet such expenses with its
current liquid capital resources, but if the funds available for use by
the Company prove inadequate, the Company will seek to meet such expenses
by seeking to have payment of them deferred until after the combination
shall have been consummated or, in the alternative, by obtaining loans or
other capital contributions from the Company's founding stockholders.
The Company remains in the development stage and, since inception,
has experienced no significant change in liquidity or capital resources
or stockholder's equity other than the receipt of net proceeds from its
public offering and a minimal amount of inside capitalization funds and
distribution of escrowed funds in April 1996. The Company's balance
sheet for the fiscal year ended June 30, 1996, reflects a current asset
value of $18,216 and a total asset value of $18,216. The figures compare
to $22,875 in current assets and $116,593 in total assets at June 30,
1995. The total assets in the 1995 fiscal year end consisted primarily
of restricted cash deposited into escrow pursuant to the Colorado
Securities Act, while the total assets at the 1996 fiscal year end
consist of $18,216 of unrestricted cash. The decreases in current and
total assets from the 1995 fiscal year end to the 1996 fiscal year end
are attributable to the Company's operating expenses exceeding its
receipt of interest earned on cash balances during the fiscal year ended
June 30, 1996, and distribution of escrowed funds.
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The Company continues to carry out its plan of business as discussed
above in Item 1. The Company's liquidity and capital resources will
continue to be diminished at least until the consummation of a business
combination and will thereafter continue to diminish unless and until the
business entity which the Company acquires has sufficient capital
resources and/or revenues to cover its operating costs.
Results of Operations
Since completing its public offering in October 1992, the Company
has engaged in no significant operations other than the search for, and
identification and evaluation of, possible acquisition candidates. Other
than interest income of $3,458 and $3,506, no revenues were received by
the Company during the fiscal years ended June 30, 1996 and 1995,
respectively. Since inception, the Company has earned interest income of
$11,876. No other revenues have been received by the Company since
inception. The Company experienced a net loss of $4,955 and $2,198,
respectively, during the fiscal years ended June 30, 1996 and 1995. This
increase in net loss is attributable to the fact that the Company's travel
expenses increased during fiscal 1996 a compared to fiscal 1995.
For the current fiscal year, the Company anticipates an increased
net loss owing to expenses associated primarily with compliance with
reporting requirements and with locating and evaluating acquisition
candidates and reduced interest income resulting from lower cash balances
after the refund of the escrowed funds. The Company anticipates that
until a business combination is completed with an acquisition candidate,
it will not generate revenues other than interest income, and may continue
to operate at a loss after completing a business combination, depending
upon the performance of the acquired business.
ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA
The response to this item is being submitted as a separate section
of this report beginning on page F-1.
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
On August 27, 1993, the Company engaged Comiskey & Company,
Professional Corporation ("Comiskey") as its principal accountant to
audit its financial statements, thereby resulting in the dismissal of
Janet Loss, C.P.A., P.C. ("Loss"), its previous auditor.
Loss acted as the Company's auditor for the fiscal years ended June
30, 1991 and June 30, 1992.
In connection with the audits for the Company's fiscal years ended
June 30, 1991 and 1992, and for the subsequent interim periods preceding
the engagement of Comiskey as the Company's auditor, there has been no
disagreement between the Company and Loss concerning accounting
principles or practices, financial statement disclosures, or auditing
scope or procedures which would have caused Loss to make a reference to
the subject matter of the disagreement in connection with its reports.
In connection with the audits for the Company's fiscal years ended
June 30, 1991 and 1992, the reports by Loss relating to the financial
statements of the Company did not contain an adverse opinion or a
disclaimer of opinion, nor were the reports qualified or modified as to
audit scope, accounting principles, or uncertainty.
The decision to engage Comiskey was recommended and approved by the
Company's directors.
No event of the types listed in paragraphs (a)(1)(v)(A) through (D)
of Section 229.304 of the Securities Exchange Act of 1934 occurred for
the fiscal years ended June 30, 1991 and 1992, or for the subsequent
interim periods prior to the dismissal of Loss as auditors for the
Company. Loss has confirmed the foregoing in a letter to the Securities
and Exchange Commission.
5
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PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.
Identification of Directors and Executive Officers of the Company
The directors and executive officers currently serving the Company
are as follows:
Name Age Position Held and Tenure
------ ----- --------------------------
Frank L. Kramer 54 President, Director
since July 13, 1990
Ronald J. Miller 53 Secretary, Treasurer, Director
since July 13, 1990
The directors named above will serve until the first annual meeting
of the Company's stockholders. Thereafter, directors will be elected for
one-year terms at the annual stockholders' meeting. Officers will hold
their positions at the pleasure of the board of directors, absent any
employment agreement, of which none currently exist or are contemplated.
There are no family relationships among the officers and directors.
There is no arrangement or understanding between any of the directors or
officers of the Company and any other person pursuant to which any
director or officer was or is to be selected as a director or officer.
The directors and officers will devote their time to the Company's
affairs on an "as needed" basis, which, depending on the circumstances,
could amount to as little as two hours per month, or as much as forty
hours per week, but more than likely will fall within the range of five
to ten hours per month.
Certain Significant Employees
No persons other than the executive officers listed above are
considered to be significant employees.
Business Experience
The following is a brief account of the education and business
experience during at least the past five years of the Company's executive
officers and directors, indicating their principal occupations and
employment during that period, and the names and principal businesses of
the organizations in which such occupations and employment were carried
out.
Biographical Information
Frank L. Kramer.
Mr. Kramer has served as President and as a
director of the Company since July 1990. Since January 1991, Mr. Kramer
has been self-employed as a financial consultant in the Denver, Colorado
area. From 1987 to December 1990, Mr. Kramer was affiliated with New
York Life Insurance Company ("New York Life") as an agent and recruiter.
From 1986 until March of 1987, he was an employee and a director of
Optimum Manufacturing, Inc., a public company engaged in manufacturing in
Denver, Colorado. From 1981 to late 1987, Mr. Kramer was self-employed
as a private financial consultant in the Denver, Colorado area, assisting
businesses in arranging interim financing for their business operations,
through private and commercial borrowings. He has also been engaged in
the structuring and implementing of private financing for the oil and gas
and commercial real estate industries. Mr. Kramer was affiliated with
New York Life from 1968 through 1981 and was engaged in sales, sales
management and estate planning. He became a Chartered Life Underwriter
in 1972. From 1973 through 1981, he was General Manager of two of New
York Life's general offices. Mr. Kramer has been and is involved in a
number of "blind pool" companies as outlined in the following paragraph.
6
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Mr. Kramer served as president and a director from 1984 to 1987 of
Fi-Tek Corp., a "blind pool" company headquartered in Aurora, Colorado,
which completed an offering of securities in 1986. In 1987, Fi-Tek Corp.
acquired Boston Technology, Inc. and moved its operations to Cambridge,
Massachusetts. From May 1987 to November 1988, Mr. Kramer served as
president, treasurer and the chairman of the board of Fi-Tek II, Inc., a
"blind pool" company headquartered in Aurora, Colorado, which completed
an offering of securities in July 1988. In October 1988, Fi-Tek II,
Inc., acquired On Line Communications, Inc. and moved its operations to
San Jose, California. The company subsequently changed its name to On
Line Network, Inc. and has since ceased operations. Mr. Kramer also
served, commencing in November 1988, as the president, treasurer and a
director of Fi-Tek III, Inc., a Delaware-chartered "blind pool"
corporation which completed an offering of securities in September 1989,
and which in August 1990 acquired Videoconferencing Systems, Inc., a
Norcross, Georgia-based company. Effective as of the date of
acquisition, Mr. Kramer resigned as president and treasurer, but retained
his position on the board of directors. The Company has since changed
its name to VSI Enterprises, Inc. and Mr. Kramer resigned his position as
director on July 15, 1991. From February 1987 until December 1989, he
was also the treasurer and a director of Bluestone Capital Corp., a
Colorado "blind pool" corporation which completed an offering of
securities in November 1988 and which moved its operations to Braintree,
Massachusetts after acquiring Dialogue, Inc. in December 1989. The
company has since ceased operations. Mr. Kramer also served as an
officer and director of Catalina Capital Corp. ("Catalina"), a Delaware-
chartered "blind pool" corporation which completed a public offering of
its securities in April 1991 and which moved its operations to
Scottsdale, Arizona after acquiring Explore Technology, Inc. ("Explore")
in August 1992. Mr. Kramer resigned all positions with Catalina upon the
closing of the acquisition of Explore. Explore has since changed its
name to Instant Video Technology, Inc. Mr. Kramer also served as
president, treasurer and a director of Fi-Tek IV, Inc., a Delaware-
chartered "blind pool" corporation which completed an offering of
securities in September 1990. During December 1992, Fi-Tek IV
completed a reverse acquisition (stock-for-stock exchange) of DBS
Network, Inc., a Mill Valley, California-based company, which
through its equity ownership of another entity, holds an interest in a
permit granted by the Federal Communications Commission for launch and
operation of direct broadcast satellites and is otherwise engaged in the
automated meter reading business for public utilities from satellites.
Fi-Tek IV has since changed its name to DBS Industries, Inc. For
approximately a one-month period in October 1990, Mr. Kramer served as a
director of Power Capital, Inc. (now known as 1st National Film Corp.),
a "blind pool" company which completed a public offering of its
securities in November 1989. Mr. Kramer is also an officer and director
of three other "blind pool" companies, Fi-Tek V, Inc., Fi-Tek VII, Inc. and
Harbour Capital Corp. Fi-Tek V, Inc. completed a "blind pool" public offering
of its securities in January 1992, and Fi-Tek VII, Inc. completed a
"blind pool" public offering of its securities in October 1992. Harbour
Capital Corp. completed a "blind pool" public offering of its securities in
October 1993.
Mr. Kramer obtained a B.S. Degree in Business Administration from
Louisiana State University in 1964.
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Ronald J. Miller.
Mr. Miller is the Secretary, Treasurer and a
director of the Company. He currently devotes the majority of his time
and attention to his personal investments and to other "blind pool"
companies in which he holds one or more position as officer, director, or
principal shareholder as described below. Mr. Miller served as secretary
and director of Fi-Tek III, Inc., from inception until August 1990, when
Fi-Tek III, Inc. acquired Videoconferencing Systems, Inc. Mr. Miller
served from inception until December 1993 as a director of Fi-Tek IV,
Inc., and has served since inception as secretary, treasurer, and
director of Fi-Tek V, Inc. and Fi-Tek VII, Inc. See biography of Mr.
Kramer for more information with respect to each of these development
stage companies. From March 11, 1988 through the present time, Mr.
Miller has served as president, treasurer and sole director of The
Phoenix Companies , Inc., which is based in Denver, Colorado and
incorporated under the laws of the State of Delaware. The Phoenix
Companies, Inc. was formed to "spin-off" publicly held subsidiaries as
acquisition candidates of private companies and business opportunities.
The Phoenix Companies, Inc. completed a public offering of its securities
in June 1990. The Company currently has no business operations. Since
February 1989, Mr. Miller has served as chief executive officer, secretary,
and a director of DataMerge, Inc., a Delaware-chartered company which has
developed and is currently marketing a financing sources database software
product. From June 1985 until October 26, 1990, Mr. Miller served as a
director of Power Capital, Inc. ("Power Capital"), a "blind pool"
company which completed a public offering of its securities on November 9, 1989.
In October 1990, Power Capital acquired 1st National Film Corp., a
California corporation engaged in the business of acquiring and then
distributing completed feature films for family viewing, and changed its name
to 1st National Film Corp. Effective as of the acquisition, Mr. Miller
resigned as a director, and as secretary and treasurer, having held the
latter two positions since October 1, 1990. Mr. Miller also served from
April 1987 to May 1990 as a director of Boston Technology, Inc. (formerly
Fi-Tek Corp.), a Delaware corporation, based in Cambridge, Massachusetts,
which is involved in the design, manufacture and marketing of voice
processing systems. See biography of Mr. Kramer for more information on the
history of Fi-Tek Corp. From 1978 to July 31, 1991, Mr. Miller was a partner
in the Denver, Colorado law firm of Pred and Miller. Pred and Miller acted as
counsel to the Company in connection with its offering of securities, but
that firm dissolved as of July 31, 1991 when Mr. Miller decided to
withdraw from the practice of law. From 1968 to 1978, Mr. Miller was
engaged in the private practice of law in Denver, Colorado, as an
associate and a partner in two different law firms. Since 1975, Mr.
Miller has specialized his practice in the areas of securities, corporate
and real estate law, and more recently until he withdrew from practice,
limited his practice to corporate and securities laws, and mergers and
acquisitions. Pred and Miller acted as general corporate and securities
counsel for a number of small public companies, and acted as securities
counsel for numerous "blind pool" companies, both during their formation
and initial public offering, and in the negotiations and acquisition of
business opportunities.
Mr. Miller received a B.A. Degree from Simpson College in 1965, and
Juris Doctor degree (magna cum laude) from the University of Denver
College of Law in 1968.
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ITEM 10. EXECUTIVE COMPENSATION
(a) Cash Compensation
Since inception, no executive officer of the Company has received
cash compensation other than reimbursement of expenses incurred on behalf
of the Company, except that (i) Mr. Kramer, the Company's President,
received $3,000 of salary during the 1993 fiscal year and (ii) a law firm
of which Mr. Miller, the Company's Secretary and Treasurer, was a partner
until the firm dissolved in July 1991, has received a total of $9,500 for
legal services performed since inception. See "Item 12. Certain
Relationships and Related Transactions."
(b) Compensation Pursuant to Plans
None.
(c) Other Compensation
None.
(d) Compensation of Directors
None.
(e) Termination of Employment and Change of Control
Arrangements
None.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
(a) & (b) Security Ownership of Certain Beneficial Owners
and Management
As of August 31, 1996, the persons listed in the table set forth
below were known by the Company to own or control beneficially more than
five percent of its outstanding common stock, par value $.00001 per
share, its only class of outstanding securities.
Name and Address of Number of Shares Percentage
Beneficial Owner Owner Beneficially of Class
- ------------------- -------------------- ------------
*Frank L. Kramer 6,150,000 21%
3127 Ramshorn Drive
Castle Rock, CO 80104
*Ronald J. Miller 6,500,000(1) 22%
300 High Street
Denver, CO 80218
Maurice LaFlamme 4,250,000 15%
49 Bay View Drive North
Jamestown, RI 02835
*All directors and 12,650,000 43%
executive officers
(2 people)
(1) Includes 100,000 shares held in an individual retirement account
for the benefit of Mr. Miller's spouse, in which shares Mr. Miller
disclaims all beneficial interest.
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(c) Changes in Control
The Company knows of no arrangement or understanding the operation
of which may at a subsequent date result in a change of control of the
Company.
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Since inception, the Company has sold to its officers, directors and
others in a private placement a total of 21,000,000 shares of Common
Stock for a total of $18,000 or an average of $.0009 per share.
Certificates evidencing the Common Stock issued by the Company to these
persons have all been stamped with a restrictive legend, and are subject
to stop transfer orders by the Company. No officer, director, promoter,
or affiliate of the Company has or proposes to have any direct or
indirect material interest in any asset proposed to be acquired by the
Company through security holdings, contracts, options, or otherwise.
The Company has paid Pred and Miller, of which Ronald J. Miller, the
Company's Secretary, Treasurer and a director, was a partner until the
firm dissolved in July 1991, a total of $9,500 in fees for legal work
performed in connection with the Company's public offering. The Company
has paid to Frank L. Kramer a total salary of $3,000 for services
rendered in his capacity as President of the Company.
The Company does not have any pension, profit-sharing, stock option,
stock bonus, or other benefit plans. Such plans may be adopted in the
future at the discretion of the Board of Directors.
The Company presently maintains its offices at the home of its
President, for which it pays no rent, and for which it does not
anticipate paying rent in the future. The Company anticipates that
following the consummation of a business combination with an acquisition
candidate, the Company's office will be moved, but cannot predict future
office or facility arrangements with officers, directors or affiliates of
the Company.
The Company may enter into an agreement with an acquisition
candidate requiring the sale of all or a portion of the Common Stock held
by the Company's current stockholders to the acquisition candidate or
principals thereof, or to other individuals or business entities, or
requiring some other form of payment to the Company's current
stockholders, or requiring the future employment of specified officers
and payment of salaries to them. It is more likely than not that any
sale of stock of the Company's current stockholders to an acquisition
candidate would be at a price substantially higher than that originally
paid by such stockholders. As a condition to closing an acquisition, the
acquisition candidate may require that additional funds be raised for use
by the surviving entity, which may involve the purchase of shares of
Common Stock of the Company that are "restricted" (as defined by Rule 144
of the Securities Act of 1933) for a price which may be less than that
paid by investors in the public offering. Any payment to current
stockholders or purchase of stock by current stockholders in the context
of an acquisition involving the Company would be determined entirely by
the largely unforeseeable terms of a future agreement with an
unidentified business entity.
There have been since inception no transactions, or series of
transactions, nor are there any currently proposed transactions, or
series of the same to which the Company is a party, in which the amount
involved exceeds $60,000 and in which to the knowledge of the Company any
director, executive officer, nominee, five percent shareholder or any
member of the immediate family of the foregoing persons have or will have
a direct or indirect material interest.
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PART IV
ITEM 13. EXHIBITS, FINANCIAL STATEMENT AND SCHEDULES AND REPORTS ON
FORM 8-K
(a) Financial Statements and Schedules
The following Financial Statements are filed as part of this report:
Independent Auditor's Report of Comiskey & Company F-1
Balance Sheet F-2
Statements of Operations and Accumulated Deficit F-3
Statement of Stockholders' Equity F-4
Statements of Cash Flows F-5
Notes to Financial Statements F-6-7
(b) Reports on Form 8-K
None.
(c) Exhibits
The following Exhibits are filed with this report:
Name of Exhibit
(3.1) Certificate of Incorporation, incorporated by reference
to Registration Statement No. 33-37513-D, effective
April 14, 1992
(3.2) Bylaws, incorporated by reference to Registration
Statement No. 33-37513-D, effective April 14, 1992
(4.1) Rights of Stockholders (included in 3.1 and 3.2 above)
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused this
Annual Report on Form 10-K SB to be signed on its behalf by the undersigned,
duly authorized.
Date: October 11, 1996 FI-TEK VI, INC.
By: /s/ Frank L. Kramer
-------------------
Frank L. Kramer, President
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons, which include
the Principal Executive Officer, the Principal Financial Officer and a
majority of the Board of Directors on behalf of the Registrant and in the
capacities and on the dates indicated.
Name Title Date
---------------------- ------------------- --------------
/s/ Frank L. Kramer
Frank L. Kramer President, Director, and
Principal Executive Officer October 11, 1996
/s/ Ronald J. Miller
Ronald J. Miller Treasurer, Secretary,
Director and Principal
Financial Officer October 11, 1996
Supplemental Information to be Furnished with Reports Filed Pursuant to
Section 15(d) of the Act by Registrants Which Have Not Registered
Securities Pursuant to Section 12 of the Act.
No annual report or proxy materials have been sent to security holders.
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INDEPENDENT AUDITORS' REPORT
The Board of Directors and Stockholders of
Fi-Tek VI, Inc.
We have audited the accompanying balance sheet of Fi-Tek VI, Inc. (a
development stage company) as of June 30, 1996, and the related
statements of loss and accumulated deficit, stockholders' equity, and
cash flows for the two years ended June 30, 1996, and for the period from
inception (July 12, 1990) to June 30, 1996. 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 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 Fi-Tek VI,
Inc. as of June 30, 1996, and the results of its operations and its cash
flows for each of the two years ended June 30, 1996 and for the period
from inception (July 12, 1990) to June 30, 1996 in conformity with
generally accepted accounting principles.
Aurora, Colorado
September 10, 1996
COMISKEY & COMPANY
PROFESSIONAL CORPORATION
F-1
<PAGE>
Fi-Tek VI, Inc.
(A Development Stage Company)
BALANCE SHEET
June 30, 1996
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 18,216
----------
Total current assets 18,216
OTHER ASSETS
Organizational costs (net) -
----------
Total other assets -
----------
TOTAL ASSETS $ 18,216
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 50
Accounts payable - related party 425
----------
Total current liabilities 475
STOCKHOLDERS' EQUITY
Common stock, $0.00001 par value;
500,000,000 shares authorized;
29,042,500 shares issued and
outstanding at June 30, 1996. 290
Preferred stock, $0.00001 par value;
20,000 shares authorized; no shares
issued and outstanding -
Additional paid-in capital 38,229
Deficit accumulated during the
development stage (20,778)
----------
Total stockholders' equity 17,741
----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 18,216
==========
The accompanying notes are an integral part
of the financial statements
F-2
<PAGE>
Fi-Tek VI, Inc.
(A Development Stage Company)
STATEMENTS OF LOSS AND ACCUMULATED DEFICIT
Period
July 12, 1990
(Inception) For the year
to June 30, ended June 30,
1996 1996 1995
------------- ---------- ----------
REVENUES
Investment income $ 11,876 $ 3,458 $ 3,506
---------- -------- --------
EXPENSES
Legal and accounting 19,557 4,331 4,236
Office expense 3,783 859 325
Transfer agent 1,812 576 423
Taxes and licenses 1,979 620 620
Officer compensation 3,000 - -
Travel 2,023 2,023 -
Amortization 500 4 100
---------- -------- --------
Total expenses 32,654 8,413 5,704
---------- -------- --------
NET LOSS (20,778) (4,955) (2,198)
Accumulated deficit
Balance, beginning of period - (15,823) (13,625)
---------- -------- --------
Balance, end of period $ (20,778) $ (20,778) $ (15,823)
========== ======== ========
NET LOSS PER SHARE $ (NIL) $ (NIL) $ (NIL)
========== ======== ========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 25,945,824 29,042,500 29,042,500
========== ========== ==========
The accompanying notes are an integral part
of the financial statements
F-3
<PAGE>
Fi-Tek VI, Inc.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
For the period from inception (July 12, 1990) to June 30, 1996
<TABLE>
<S> <C> <C> <C> <C> <C>
Deficit
Common stock accumulated Total
------------------ Additional during the stock-
Number of paid-in developments holders
shares Amount capital stage equity
---------- -------- ----------- ------------ ---------
Common stock issued
for cash, July and
August, 1990 at
between $0.0003 and
$0.003 per share 21,000,000 $ 210 $ 17,790 $ - $ 18,000
Net loss for the
period July 12,
1990 (inception)
through June 30, 1991 - - - (1,815) (1,815)
---------- ------- ---------- ----------- --------
Balances,
June 30, 1991 21,000,000 210 17,790 (1,815) 16,185
---------- ------- ---------- ----------- --------
Net loss for the year
ended June 30, 1992 - - - (537) (537)
---------- ------- ---------- ----------- --------
Balances,
June 30, 1992 21,000,000 210 17,790 (2,352) 15,648
Common stock issued
upon closing of
public offering
October 29, 1992
at $0.02 per share 8,042,500 80 160,810 - 160,890
Deferred
offering cost - - (46,657) - (46,657)
Net loss for the year
ended June 30, 1993 - - - (7,581) (7,581)
---------- ------- ---------- ----------- --------
Balances,
June 30, 1993 29,042,500 290 131,943 (9,933) 122,300
Net loss for the year
ended June 30, 1994 - - - (3,692) (3,692)
---------- ------- ---------- ----------- --------
Balances,
June 30, 1994 29,042,500 290 131,943 (13,625) 118,608
Net loss for the year
ended June 30, 1995 - - - (2,198) (2,198)
---------- ------- ---------- ----------- --------
Balances,
June 30, 1995 29,042,500 290 131,943 (15,823) 116,410
Refund of
escrowed monies - - (93,714) - (93,714)
Net loss for the year
ended June 30, 1996 - - - (4,955) (4,955)
---------- ------- ---------- ----------- --------
Balance,
June 30, 1996 29,042,500 $ 290 $ 38,229 $ (20,778) $ 17,741
========== ======= ========== =========== ========
</TABLE>
The accompanying notes are an integral part
of the financial statements
F-4
<PAGE>
Fi-Tek VI, Inc.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
Period
July 12, 1990
(Inception) For the year
to June 30, ended June 30,
1996 1996 1995
------------- ---------- ----------
CASH FLOWS FROM
OPERATING ACTIVITIES
Net loss $ (20,778) $ (4,955) $ (2,198)
Adjustments to reconcile
net loss to net cash used
in operating activities:
Amortization 500 48 100
Increase (decrease) in
accounts payable 50 16 (306)
Increase (decrease) in
accounts payable -
related party 425 276 (3)
---------- -------- --------
Net cash used by
operating activities (19,803) (4,659) (2,407)
CASH FLOWS FROM
INVESTING ACTIVITIES
Increase in organization costs (500) - -
CASH FLOWS FROM
FINANCING ACTIVITIES
Issuance of common stock 178,890 - -
Deferred offering costs paid (46,657) - -
Statutory escrow contribution (93,714) - -
Loans from shareholders (4,000) - -
Repayment of loans from
shareholders 4,000 - -
---------- -------- --------
Net cash provided by
financing activities 38,519 - -
---------- -------- --------
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 18,216 (4,659) (2,407)
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD - 22,875 25,282
---------- -------- --------
CASH AND CASH EQUIVALENTS,
END OF PERIOD $ 18,216 $ 18,216 $ 22,875
========== ======== ========
The accompanying notes are an integral part
of the financial statements
F-5
<PAGE>
Fi-Tek VI, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
1. Summary of Significant Accounting Policies
------------------------------------------
Development Stage Company
Fi-Tek VI, Inc. (the "Company") was incorporated under the laws of the
State of Delaware on July 12, 1990. Its office is located at the office
of its President at 3127 Ramshorn Drive, Castle Rock, Colorado 80104.
The Company is a new enterprise in the development stage as defined by
Statement No. 7 of the Financial Accounting Standards Board and has not
engaged in any business other than organizational efforts, raising
capital, and investigating business opportunities. It has no full-time
employees and owns no real property. The Company intends to seek out and
take advantage of business opportunities that may have potential for
profit and, to that end, intends to acquire properties or businesses, or
a controlling interest therein. Management of the Company will have
virtually unlimited discretion in determining the business activities in
which the Company might engage.
The Company currently does not own any properties or an interest in any
business. Moreover, it has not identified any properties or business
opportunities that it shall seek to acquire, has no understanding or
arrangement to acquire any properties or business interests, and has not
identified any specific geographical area, industry, or type of business
in which it intends to operate.
Accounting Method
The Company records income and expense on the accrual method.
Fiscal Year
The Company has selected a June 30 fiscal year end.
Organization Costs
Organization costs are amortized over a 60-month period using the
straight-line method.
Deferred Offering Costs
Costs associated with the public offering have been charged to the
proceeds of the offering.
Loss Per Share
Loss per share was computed using the weighted average number of shares
outstanding during the period. Shares issued to insiders in anticipation
of a public offering have been accounted for as outstanding since
inception.
Statement of Cash Flows
For purposes of the statement of cash flows, the Company considers all
highly liquid debt instruments purchased with an original maturity date
of three months or less to be cash equivalents.
Use of Estimates
The preparation of the Company's financial statements in conformity with
generally accepted accounting principles requires the Company's
management to make estimates and assumptions that effect the amounts
reported in these financial statements and accompanying notes. Actual
results could differ from those estimates.
F-6
<PAGE>
Fi-Tek VI, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
June 30, 1996
2. Public Offering
---------------
On October 29, 1992, the Company completed its initial public offering
after selling 8,042,500 units. Each unit consists of one share of common
stock, one Class A warrant, and one Class B warrant. Each Class A
warrant and each Class B warrant will be exercisable for one share of
common stock at a price of $0.12 per share and $0.20 per share,
respectively, any time through April 14, 1997 and may be transferred
separately from the common stock. The Company may redeem the warrants at
a price of $0.0001 per warrant upon 30 days' written notice, reduce the
exercise price, or indefinitely extend the exercise period of the
warrants. At June 30, 1996, no warrants have been exercised.
The Company received net proceeds from the offering of $114,233 after
deducting offering costs of $46,657.
Included in the proceeds the Company received from the offering is $40
from the underwriter for 804,250 underwriter warrants for purchase of the
Company's units. Each unit consists of one share of common stock, one
Class A warrant, and one Class B warrant to purchase one share of common
stock, at an exercise price of $0.0214, commencing one year from the date
of the offering for a period of four years. The warrants are non-
redeemable and the Company has agreed to certain terms to register the
securities underlying the underwriter warrants.
3. Restricted Cash
---------------
The Company is subject to the escrow provisions of The Colorado
Securities Act, which provides that 80% of net proceeds received by the
issuer shall be placed in escrow until an amount equal to at least 50
percent of the gross proceeds of the offering is committed for use in one
or more specific lines of business. The Company has escrowed $93,714 of
investor monies under these provisions.
Under Colorado Securities law, the funds are to be distributed upon the
second anniversary of the date of the public offering, unless the escrow
is extended by a vote of the public shareholders. Pursuant to the escrow
agreement entered into, the escrow may not, in any event be extended
beyond the fourth anniversary of the date of offering.
Accordingly, effective April 14, 1996, the Company requested the refund
of the escrowed funds to those shareholders of record of the securities
sold pursuant to the offering on a pro rata basis based on the number of
shares held as of April 14, 1996, the fourth anniversary of the date of
the Company's prospectus. As of June 30, 1996, all escrowed funds had
been refunded to the shareholders.
4. Related Party Transactions
--------------------------
The president is providing office space at no charge to the Company. The
president of the Company is reimbursed for all out-of-pocket expenses.
The Company has agreed to pay the president of Fi-Tek VI, Inc. a salary
for his services. He will be compensated at a rate of $45 per hour for
time devoted to the activities of the Company, in excess of five hours
per month, limited only by a cap of $1,500 per month. No compensation
was required to be paid during the year ended June 30, 1996.
The Company's secretary and director was a partner in the law firm of
Pred & Miller, the Company's general and securities counsel from July 12,
1990 (inception) through June 1991. Since inception, the Company has
paid approximately $9,500 to this firm for services rendered.
5. Income Taxes
------------
The Company has Federal net operating loss carryforwards of approximately
$20,800 expiring between 2008 and 2010. The tax benefit of these net
operating losses, which totals approximately $3,600, has been offset by a
full allowance for realization. This carryforward may be limited upon
the consummation of a business combination under IRC Section 381. For
the years ended June 30, 1996 and 1995, the valuation allowance increased
by $954 and $440, respectively.
F-7
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
BALANCE SHEET AND STATEMENTS OF LOSS AND ACCUMULATED DEFICIT AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH 10KSB FOR THE YEAR
ENDED JUNE 30, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-END> JUN-30-1996
<CASH> 18216
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 18216
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 18216
<CURRENT-LIABILITIES> 475
<BONDS> 0
0
0
<COMMON> 290
<OTHER-SE> 17451
<TOTAL-LIABILITY-AND-EQUITY> 18216
<SALES> 0
<TOTAL-REVENUES> 3458
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 8413
<LOSS-PROVISION> (4955)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (4955)
<INCOME-TAX> (4955)
<INCOME-CONTINUING> (4955)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4955)
<EPS-PRIMARY> (0.001)
<EPS-DILUTED> (0.001)
</TABLE>