ROSECAP, INC.
750 Shames Drive
Westbury, New York 11590
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS TO
BE HELD ON JUNE 18, 1998 AT 2:00 P.M.
To the Shareholders of
Rosecap, Inc.
Notice is hereby given that the Annual Meeting of Shareholders of
Rosecap, Inc. , a New York corporation (the "Company"), will be held at the
offices of the Company at 750 Shames Drive, Westbury, New York 11590 on June 18,
1998 at the hour of 2:00 p.m. local time for the following purposes:
(1) To elect three (3) Directors of the Company for the following year;
(2) To approve an amendment to the Company's Articles of
Incorporation to change the name of the Company to Westbury
Metals Group, Inc.;
(3) To consider and approve the adoption of the 1997 Omnibus Stock
Incentive Plan of Westbury Alloys, Inc. (the "Plan") and to
increase the number of shares to which the Plan relates to
750,000; and
(4) To transact such other business as may properly come before the
Meeting.
Only shareholders of record at the close of business on May 22, 1998
are entitled to notice of and to vote at the meeting or any adjournment thereof.
By Order of the Board of Directors
David W. Sass, Secretary
May 22, 1998
IF YOU WISH TO VOTE IN FAVOR OF EACH OF THE PROPOSALS AND FOR
THE NOMINEES PRESENTED, CHECK THE APPROPRIATE BOX AND SIGN,
DATE AND RETURN THE ENCLOSED PROXY IN THE ENCLOSED ENVELOPE
WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IN
ANY EVENT, YOUR PROMPT RETURN OF SIGNED AND DATED PROXY WILL
BE APPRECIATED.
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ANNUAL MEETING OF STOCKHOLDERS
OF
Rosecap, Inc.
June 18, 1998
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PROXY STATEMENT
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GENERAL INFORMATION
Proxy Solicitation
This Proxy Statement is furnished to the holders of Common
Stock, $.001 par value per share ("Common Stock"), of Rosecap, Inc. (the
"Company") in connection with the solicitation of proxies on behalf of the Board
of Directors of the Company for use at the Annual Meeting of Stockholders
("Annual Meeting") to be held June 18, 1998, or at any continuation or
adjournment thereof, pursuant to the accompanying Notice of Annual Meeting of
Stockholders. The purpose of the meeting and the matters to be acted upon are
set forth in the accompanying Notice of Annual Meeting of Stockholders. The
Board of Directors knows of no other business which will come before the
meeting.
Proxies for use at the meeting will be mailed to stockholders
on or about May 25, 1998 and will be solicited chiefly by mail, but additional
solicitation may be made by telephone, telegram or other means of
telecommunications by directors, officers, consultants or regular employees of
the Company. The Company may enlist the assistance of brokerage houses,
fiduciaries, custodians and other like parties in soliciting proxies. All
solicitation expenses, including costs of preparing, assembling and mailing the
proxy material, will be borne by the Company.
Revocability and Voting of Proxy
A form of proxy for use at the meeting and a return envelope
for the proxy are enclosed. Stockholders may revoke the authority granted by
their execution of proxies at any time before their effective exercise by filing
with the Secretary of the Company a written revocation or duly executed proxy
bearing a later date or by voting in person at the meeting. Shares represented
by executed and unrevoked proxies will be voted in accordance with the choice or
instructions specified thereon. If no specifications are given, the proxies
intend to vote "FOR" each of the nominees for director as described in Proposal
No. 1 and "FOR" Proposal Nos. 2 and 3. Proxies
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marked as abstaining will be treated as present for purposes of determining a
quorum for the Annual Meeting, but will not be counted as voting in respect of
any matter as to which abstinence is indicated. If any other matters properly
come before the meeting or any continuation or adjournment thereof, the proxies
intend to vote in accordance with their best judgment.
Record Date and Voting Rights
Only stockholders of record at the close of business on May
22, 1998 are entitled to notice of and to vote at the Annual Meeting of
Shareholders or any continuation or adjournment thereof. Each share of Common
Stock is entitled to one vote per share. Any share of Common Stock held of
record on May 22, 1998 shall be assumed, by the Board of Directors, to be owned
beneficially by the record holder thereof for the period shown on the Company's
stockholder records. The affirmative vote of a majority of the shareholders
present in person or by proxy at the meeting is required for the election of the
directors to be elected by such shares. The present directors and officers of
the Company holding approximately 25% of the outstanding Common Stock of the
Company intend to vote "FOR" the slate of directors and "FOR" Proposal Nos. 2
and 3.
PROPOSAL NO. 1
ELECTION OF DIRECTORS
The By-Laws of the Company provide for a Board of Directors of
not less than three (3) members. The Board of Directors currently consists of
three (3) members. At the meeting, three (3) directors will be elected to serve
until the 1999 Annual Meeting of Stockholders and until their successors have
been elected and qualified. Present vacancy or vacancies which occur during the
year may be filled by the Board of Directors, and any directors so appointed
must stand for reelection at the next annual meeting of stockholders. All
current directors have been nominated for reelection. The nominees to be voted
on by stockholders are Messrs. Sherman, O'Hanlon and Riess.
All nominees have consented to be named and have indicated
their intent to serve if elected. The Company has no reason to believe that any
of these nominees are unavailable for election. However, if any of the nominees
become unavailable for any reason, the persons named as proxies may vote for the
election of such person or persons for such office as the Board of Directors of
the Company may recommend in the place of such nominee or nominees. It is
intended that proxies, unless marked to the contrary, will be voted in favor of
the election of Messrs. Sherman O'Hanlon and Riess.
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The Board of Directors recommends that the stockholders vote "FOR" the
election of the following three nominees (Item No. 1 on the proxy card).
NOMINEES FOR ELECTION
The Directors of the Company and a brief summary of their business experience
and certain other information with respect to them are set forth below:
Name Age Capacities In Which Served
Mandel Sherman 59 President, Chief Executive Officer
and Director
Michael A. O'Hanlon 51 Director
Michael Riess 57 Director
Mandel Sherman, President, Chief Executive Officer and Director
Mandel Sherman, 59, has been the President, Chief Executive Officer and Director
of Westbury Alloys, Inc. ("Westbury") since July 1996. From 1993 to 1995, Mr.
Sherman acted as an independent consultant to various investment firms. From
1983 to 1993, Mr. Sherman participated in numerous real estate ventures as both
an investor and manager of developments with an approximate total value in
excess of $30 million. From 1975 to 1983, Mr. Sherman served as the Chief
Executive Officer and President of Refinement International Company
("Refinement"), a company he founded in 1975. Refinement, a full service metals
processing company with financial capabilities and capital resources in precious
metals and specialty metals markets, exceeded annual sales of $350 million and
was publicly traded on the American Stock Exchange. From 1962 to 1975, Mr.
Sherman served as the President of Eastern Foundry Supplies ("EFS"), a company
he founded in 1962. EFS concentrated in the recovery of precious metals from the
electronic and jewelry industries. In 1967, Mr. Sherman was responsible for the
sale of EFS to Whittaker Corp., a California-based Company listed on the NYSE,
where Mr. Sherman remained as President with annual sales of approximately $10
million. Mr. Sherman received his BSBA in Business Administration from Boston
University in 1959.
Michael A. O'Hanlon, Director
Michael A. O'Hanlon, 51, has been the president and chief executive officer of
DVI, Inc., ("DVI") an independent specialty finance company that conducts a
medical equipment finance business and related medical receivables finance
business, since November 1995. Mr. O'Hanlon was president and chief operating
officer from September 1994 to November 1995. Previously, Mr. O'Hanlon served as
executive vice president of DVI since joining DVI in March, 1993. Prior to
joining DVI, Mr. O'Hanlon served as president and chief executive officer of
Concord Leasing, Inc., and its subsidiary, U.S. Concord, Inc. for nine years, a
company which provides medical, aircraft, shipping and industrial equipment
financing. Previously, Mr. O'Hanlon was a senior executive with Pitney Bowes
Credit
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Corporation. Mr. O'Hanlon received his Master of Science degree from the
University of Connecticut and his Bachelor of Business Administration from the
Philadelphia College of Textiles and Science. Mr. O'Hanlon became a director of
DVI in November, 1993.
Michael Riess, Director
Michael Riess, 57, has been the president of Materials Management Corporation
("MMC") since 1978, a consulting firm specializing in precious and nonferrous
metals. Mr. Riess is also associated with Prudential Securities. He has headed
the North American trading operations of the Gulf Oil Corporation, Brascam, Ltd.
and W.C. Heraeus, GmbH. He also managed Heraeus' U.S. precious metals refining
and has been involved in trading and marketing a broad range of materials,
including metals, scrap, and concentrates. A graduate of Middlebury College with
advanced degrees from Columbia University's Graduate School of Business and its
School of International Affairs, Mr. Riess was Professor of Finance at Columbia
for eight years. He has been a member of several commodity exchanges and is a
Director of the International Precious Metals Institute and the Center for the
Study of Futures Markets.
All directors shall serve for a term of one year or until their
respective successors have been duly elected and qualified.
During Fiscal Year 1997 the Board of Directors held one meeting.
SECURITY OWNERSHIP OF PRINCIPAL STOCKHOLDERS AND MANAGEMENT
On May 22, 1998, there were 3,197,312 shares of Common Stock
outstanding. The following table sets forth as of May 22, 1998, the number of
shares of Common Stock of the Company and the percentage of that class owned
beneficially, within the meaning of Rule 13d-3 promulgated under the Securities
Exchange Act of 1934, as amended, and the percentage of the Company's voting
power owned by (i) all the directors of the Company who are stockholders; (ii)
all stockholders known by the Company to own more than five percent of the
Company's Common Stock; and (iii) all directors and officers as a group. All
shares set forth in the following table are entitled to one vote per share and
the named beneficial owner has sole voting and investment power.
Number of Shares
Name and Address Beneficially Owned(1) Percentage
Dartmouth Capital Partners(2)
210 Dartmouth Street
Pawtucket, RI 02860 832,500 26%
Mandel Sherman(3)
Westbury Alloys, Inc.
750 Shames Drive
Westbury, NY 11590 717,500 22.4%
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Number of Shares
Name and Address Beneficially Owned(1) Percentage
Michael A. O'Hanlon
DVI, Inc.
500 Hyde Park
Doylestown, PA 18901 100,000 3.10%
Directors and Officers as a Group (3) 817,500 25.60%
(1) All share amounts reflect beneficial ownership determined pursuant to Rule
13d-3 under the Exchange Act, and include voting and investment power with
respect to shares of Common Stock of the Company.
(2) The members of this limited liability company are immediate family members
of Mr. Mandel Sherman, President and Chief Executive Officer of Westbury. Mr.
Sherman disclaims beneficial ownership of such shares.
(3) Does not include 832,500 shares owned by Dartmouth Capital Partners, a
company owned and controlled by Mr. Sherman's children.
EXECUTIVE COMPENSATION
The following table sets forth the aggregate cash compensation paid by
the Company during each of the last three fiscal years to its Chief Executive
Officer.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
Summary Compensation Table
Annual Compensation Long Term Compensation
Name and principal Year
position Awards
Payouts
Salary Bonus Other annual Restricted Securities LTIP Payouts
($) ($) compen- Stock awards Underlying ($)
sation Options/SARs (#)
Mandel Sherman(1) 1997 $115,385
1996 $0
All other
compensation
</TABLE>
(1) See the discussion of the Company's employment agreement with Mr. Sherman
described below.
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CERTAIN TRANSACTIONS
On July 3, 1996, Westbury's predecessor, Westbury, LLC executed an
asset purchase agreement (the "Asset Purchase Agreement") where Westbury, LLC
purchased the assets of a unrelated New York corporation, Westbury Alloys, Inc.
("Westbury New York") for a purchase price of $650,000, payable as follows:
$550,000 in cash at or prior to closing and with a balance due in equal amounts
of $50,000 on January 31, 1997 and July 31, 1997. To fund this purchase
Westbury, LLC borrowed from Graco Holdings, Inc. ("Graco"), the sum of $550,000.
This loan has been repaid from the proceeds of certain bridge financing in the
amount of $700,000 (described below).
On July 16, 1996, the obligation due to Graco was assigned by Graco to another
affiliate of a former stockholder. In July 1996, Graco guaranteed Westbury,
LLC's line of credit ("Line of Credit") and deposited a letter of credit in the
amount of $2,600,000 as security for its guaranty.
On July 22, 1996, Lawrence Raskin, former president of Westbury New York
executed a five (5) year consulting agreement with Westbury to serve as a
consultant to Westbury in connection with transitional issues and continuing
conduct of Westbury's business. Mr. Raskin will receive a fee of $10,000 per
annum for his consulting services. As part of the consulting agreement, Westbury
signed a five year lease on its 10,200 square foot facilities at 750 Shames
Drive, Westbury, New York, with Mr. Raskin. The term of the lease expires on
July 31, 2003. Throughout the term of the lease, Westbury has the option to
renew the lease at a mutually agreeable rental at least 30 days prior to
expiration. In addition, Westbury has an option to purchase the existing
facility space at the appraised fair market value, although not for less than
$1.2 million for the first three years. Westbury has no current intention to
exercise this option.
From time to time, Westbury borrowed funds from several affiliated
investment limited partnerships. These loans were repaid in July and August,
1997. Mandel Sherman, the president, director and a principal shareholder of the
Company is the general partner and manager of such affiliated entities.
In October, 1997, Westbury, LLC merged into Westbury Alloys, Inc., a
Delaware corporation. The membership interests in Westbury, LLC were converted
into 1,850,000 shares of common stock of Westbury Alloys, Inc. in proportion to
the interest held by each member.
In December, 1997, seven investors provided bridge financing in the
amount of $700,000 and received promissory notes. As additional consideration
for each dollar loaned, the investors in the bridge financing received one Class
A Redeemable Warrant (the "Bridgeholders' Warrant"), which permits the
Bridgeholders to purchase 700,000 shares of the Company's Common Stock at an
exercise price of $2.25 per share for a period of two years from the closing of
the bridge financing. The Notes have been converted into 233,333 Shares of the
Company's Common Stock in accordance with the terms of the Company's Private
Offering Memorandum dated January 28, 1998 (described below).
On January 1, 1998, Westbury entered into a three-year employment
agreement with Mandel Sherman. Under the agreement, Mr. Sherman's compensation
is $175,000 annually. In addition, Mr.
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Sherman will receive 10% of the pretax profits of the Company in each year in
excess of $500,000 to a maximum of $175,000 per year. This agreement has been
assumed by the Company. In addition, the Company has taken out a $1,000,000
keyman life insurance policy for Mr. Sherman.
The Agreement terminates upon the death or disability of Mr. Sherman and
permits the Company to terminate the agreement, without further payment
obligation to Mr. Sherman, upon the commission of certain acts, and to terminate
the Agreement for any other reason, provided that the Company pays to him a
severance payment equal to the aggregate base salary otherwise owed to him over
the remaining term of the Agreement. Pursuant to the terms of the Agreement, in
the event that Mr. Sherman is not nominated or re-elected to serve as a member
of the Board of Directors, either he or the Company may terminate his employment
with the Company and in such event, he shall be entitled to continue to receive
his base salary as set forth in the Agreement for the remainder of the term.
The Agreement also contains certain confidentiality and non-compete
provisions which are operative during the term of the Agreement. The
confidentiality provisions remain in effect after termination of employment.
In July, 1996, the original members of Westbury, LLC, subscribed for
membership interests of $100,000, in the aggregate, in Westbury, LLC. Such
interests were converted into Westbury Common Stock at the time of the merger
between Westbury, LLC and Westbury. These subscriptions were paid in December,
1997.
On March 31, 1998, the Company completed a reverse merger of its wholly
owned subsidiary, Westbury Acquisition Corp. a New York corporation ("WAC") with
Westbury Alloys, Inc., a Delaware corporation ("Westbury") pursuant to which
Westbury has become a wholly owned subsidiary of the Company. Westbury provides
a broad range of processing and refining services in connection with the
reclamation of precious and specialty metals from scrap materials. Pursuant to
the merger, the principals of Westbury have become the principals of the Company
and have become the largest shareholders of the Company.
PROPOSAL NO. 2
TO AMEND ARTICLE FIRST OF THE COMPANY'S CERTIFICATE OF
INCORPORATION
General
The Board of Directors of the Company has unanimously adopted, subject
to stockholder approval, a resolution providing that Article FIRST of the
Company's Certificate of Incorporation be amended to change the name of the
Company from Rosecap, Inc. to Westbury Metals Group, Inc.
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In the event of a negative vote of the shareholders to this Proposal No.
2, the Company will retain the name of Rosecap, Inc.
The Board of Directors recommends that the stockholders vote "FOR"
approval of this
Proposal No. 2.
Reasons for the Proposal
On March 31, 1998, the Company completed a merger of Westbury
Acquisition Corp., a Delaware corporation and wholly owned subsidiary of the
Company, with Westbury Alloys, Inc. ("Westbury") pursuant to which Westbury is
the surviving company. Since the Company has no operating business separate from
that of its wholly owned subsidiary, the Board of Directors has determined that
it is in the Company's best interest to change its name to be more identified
with that of the operating subsidiary.
PROPOSAL NO. 3
ADOPTION OF WESTBURY'S 1997 OMNIBUS STOCK INCENTIVE PLAN
(the "PLAN");
INCREASE THE NUMBER OF SHARES TO WHICH THE PLAN RELATES TO
750,000
The Board of Directors has unanimously approved and unanimously
recommends that the shareholders ratify the adoption of Westbury's 1997 Omnibus
Stock Incentive Plan, which was adopted and ratified by the Board of Directors
and shareholders of Westbury on October 28, 1997, (the "Plan") so that the
options granted under the Plan will be exercisable in shares of the Common Stock
of the Company. The Board has also unanimously approved and recommends that the
shareholders vote to amend the Plan to increase the number of shares of the
Company's common stock which are subject to the Plan from 500,000 shares to
750,000 shares . Approval of these proposals will require the affirmative vote
of a majority of the shares present in person or represented by proxy at the
Meeting.
The Plan, as ratified, would provide a means whereby employees,
officers, directors, and certain consultants and independent contractors of the
Company ("Qualified Grantees") may acquire the Common Stock of the Company
pursuant to grants of (i) Incentive Stock Options ("ISO"), (ii) "nonqualified
stock options" and (iii) "Stock Appreciation Rights". A summary of the
significant provisions of the Plan, as amended, is set forth below. A copy of
the full Plan is annexed as Exhibit A to this Proxy Statement. The following
description of the Plan is qualified in its entirety by reference to the Plan
itself.
The purpose of the Plan is to further the long-term stability,
continuing growth and financial success of Westbury by attracting and retaining
key employees, directors and selected advisors through the use of stock
incentives, while stimulating the efforts of these individuals upon whose
judgment and interest Westbury is and will be largely dependent for the
successful conduct of its business. The Company believes that the Plan will
strengthen these persons' desire to remain with
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Westbury and will further the identification of those persons' interests with
those of the Company's shareholders.
The Plan, as ratified and amended, would provide that options to
purchase up to 750,000 shares of Common Stock of the Company may be issued to
the employees and outside directors. All present and future employees shall be
eligible to receive incentive awards under the Plan, and all present and future
non-employee directors shall be eligible to receive non-statutory options under
the Plan. An eligible employee or non-employee director shall be notified in
writing, stating the number of shares for which options are granted, the option
price per share, and conditions surrounding the grant and exercise of the
options.
The exercise price of shares of Company Stock covered by an ISO shall be
not less than 100% of the fair market value of such shares on the date of grant;
provided that if an ISO is granted to an employee who, at the time of the grant,
is a 10% shareholder, then the exercise price of the shares covered by the
incentive stock option shall be not less than 110% of the fair market value of
such shares on the date of grant. The exercise price of shares covered by a
non-qualified stock option shall be not less than 85% of the fair market value
of such shares on the date of grant.
The Plan shall be administered by a Committee, which shall be appointed
by the Board of the Company, and which shall consist of a minimum of two members
of the Board of the Company .
As of May 22, 1998, stock options to purchase 170,000 shares of Common
Stock had been granted to ten employees and were outstanding pursuant to the
Plan. Such outstanding options are subject to a four year vesting schedule and
expire October 27, 2001. The exercise price of the outstanding options granted
pursuant to the Plan is $.50 per share of Common Stock being the fair market
value on the date of grant.
The Board of Directors recommends that the stockholders vote "FOR"
approval of this
Proposal No. 3.
AUDIT MATTERS
It is expected that a representative of the firm of Citron Cooperman &
Company, independent auditors, will be present at the Annual Meeting of
Shareholders and will be available to respond to appropriate questions.
The Company's 1997 Annual Report on Form 10-KSB to shareholders will be
mailed separately from this Proxy Statement.
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OTHER BUSINESS TO BE TRANSACTED
As of the date of this Proxy Statement, the Board of Directors knows of
no other business to be presented for action at the Annual Meeting of
Stockholders. As for any business that may properly come before the Annual
Meeting or any continuation or adjournment thereof, the Proxies confer
discretionary authority to the person named therein. These persons will vote or
act in accordance with their best judgment with respect thereto.
ANNUAL REPORT TO STOCKHOLDERS
The Annual Report to Stockholders for the year ended December 31, 1997
is being mailed to stockholders with this Proxy Statement.
STOCKHOLDER PROPOSAL - 1999 ANNUAL MEETING
Any stockholder proposals to be considered by the Company for inclusion
in the proxy material for the 1999 Annual Meeting of Stockholders must be
received by the Company at its principal executive offices by December 31, 1998.
The prompt return of your proxy will be appreciated and helpful in
obtaining the necessary vote. Therefore, whether or not you expect to attend the
meeting, please sign the proxy and return it in the enclosed envelope.
BY ORDER OF THE BOARD OF DIRECTORS
David W. Sass, SECRETARY
New York, New York
May 22, 1998
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PROXY
This Proxy is Solicited on Behalf of the Board of Directors
KNOW ALL MEN BY THESE PRESENTS, that the undersigned, a shareholder in
Rosecap, Inc., a New York corporation ("Rosecap"), hereby appoints Mandel
Sherman and David W. Sass, and each of them acting jointly, if more than one be
present, to be the true and lawful attorneys and proxies for the undersigned, to
vote all shares of Rosecap as the undersigned is entitled to vote, with all
powers the undersigned would possess if personally present, at the annual
meeting of shareholders of Rosecap to be held on June 18, 1998 or any
adjournment thereof, on the following matters as designated below and, in their
discretion, on such other matters as may properly come before the meeting. This
proxy will be voted in the manner directed herein by the undersigned
shareholder. If no direction is made, this proxy will be voted FOR the following
Proposals.
1. ELECTION OF DIRECTORS
For all nominees listed below Withhold Authority to
(Except as Marked to the Vote All Nominees Listed
Contrary) ________ Below _______
Mandel Sherman, Michael A. O'Hanlon and Michael Riess
(INSTRUCTION: To withhold authority to vote for any individual nominee, print
that nominee's name on the line provided below.)
- ----------------------------------------------------------------------------
2. THE APPROVAL OF THE CHANGE OF THE NAME OF THE CORPORATION
FROM ROSECAP, INC. TO WESTBURY METALS GROUP, INC
______FOR ______AGAINST ______ABSTAIN
3. THE ADOPTION OF THE 1997 OMNIBUS STOCK INCENTIVE PLAN OF WESTBURY
ALLOYS, INC., AND THE APPROVAL TO AMEND SUCH PLAN TO INCREASE THE
NUMBER OF SHARES TO WHICH IT RELATES TO 750,000
______FOR ______AGAINST ______ABSTAIN
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OTHER MATTERS: Granting the proxies discretionary authority to vote
upon any other unforseen matters which are properly brought before the meeting
as management may recommend.
The undersigned hereby revokes any and all other proxies heretofore
given by the undersigned and hereby ratifies all that the above named proxies
may do at such meetings, or at any adjournments thereof, by virtue hereof.
When shares are held by joint tenants, both should sign. When signing
as attorney, as executor, administrator, trustee or guardian, please give full
title as such and also state the name of the stockholder of record for whom you
act. If a corporation, please sign in full corporate name by President or other
authorized officer. If a partnership, please sign in partnership name by
authorized person.
Dated:__________________, 1998
Signature
Signature, if held jointly
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY USING THE ENCLOSED
ENVELOPE
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ROSECAP, INC.
ANNUAL REPORT
JUNE 30, 1997
<PAGE>
WESTBURY ALLOYS, INC.
750 SHAMES DRIVE
WESTBURY, NY 11590
(516) 997-8333
May 21, 1998
Dear Shareholders:
I want to welcome you to our investor family and thank you for your
commitment to the Company.
From time to time I will be updating you as to the progress of your investment.
Since March 31, 1998 there have been several significant events:
The formation of West Tech, through an acquisition of assets, which gives us a
Silver Alloy Manufacturing ability together with a seasoned marketing group.
The expansion of our processing to include Platinum and Palladium metals
contained in catalytic converters.
The proposed change of name from Rose Cap, Inc. to Westbury Metals Group, Inc.
Further positive developments in the planning stage are nearing completion and
I will keep you informed as they come to fruition.
Looking forward to seeing you at the meeting.
Regards,
Manny Sherman
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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [Fee Required]
For the fiscal year ended June 30, 1997
-------------
or
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [No Fee Required] For the transition period
from ________ to _________
Commission file number 33-42408-NY
-----------
ROSECAP, INC.
-------------
(Name of Small Business Issuer as specified in its charter)
New York 11-3023099
- - ------------------------------- -------------------------
(State or other jurisdiction of (I.R.S. employer
of incorporation or organization) identification number)
236 Birchwood Road, Medford, New York 11763
- - ------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
<PAGE>
Issuer's telephone number, including area code: (516) 698-6914
---------------
Securities registered pursuant to Section 12(b) of the Exchange Act: None
Securities registered pursuant to Section 12(g) of the Exchange Act: None
Check whether the Issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act 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 ___.
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will 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-KSB or any
amendment to this Form 10-KSB. X
---
As of the date hereof, there is no public market for the Issuer's securities.
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
As of September 15, 1997, there were 87,500 shares of the Issuer's common stock
issued and outstanding.
The Issuer had no revenues for the year ending June 30, 1997.
DOCUMENTS INCORPORATED BY REFERENCE: NONE
Transitional Small Business Disclosure Format (check one):
Yes ; No X
------ -----
<PAGE>
PART I
ITEM 1. DESCRIPTION OF BUSINESS
GENERAL
The Registrant was formed on August 24, 1990 for the purpose of investing
in any and all types of assets, properties and businesses. In connection with
its initial capitalization, the Registrant issued 12,500 shares of its Common
Stock to its officers and directors for the aggregate sum of $2,500. On November
12, 1991, the United States Securities and Exchange Commission granted
effectiveness to a Registration Statement on Form S-18, filed by the Registrant
in the New York Regional Office. The Registration Statement related to an
offering of 50,000 Units of the Registrant's securities at $1.00 per Unit. Each
Unit consisted of one share of Common Stock, one Class "A" Common Stock Purchase
Warrant, and one Class "B" Common Stock Purchase Warrant. The offering was a
"blind pool" or "blank check" offering. The offering was closed on May 20, 1992.
The Registrant is seeking the acquisition of or merger with an existing
company ("Potential Business Acquisitions"). Given the limited amount to be
raised in its offering, the potential venture is likely to involve the
acquisition of or merger with a company which is not seeking immediate
substantial amounts of cash but one which desires to establish a public trading
market for its shares. There are numerous reasons why an existing privately-held
company would seek to become a public company through a merger or acquisition
rather than doing its own public offering. Such reasons include avoiding the
time delays involved in a public offering; retaining a larger share of voting
control of the publicly-held company; reducing the cost factors incurred in
becoming a public company; and avoiding any dilution requirements set forth
under various states' securities or blue sky laws or regulations.
The Registrant does not propose to restrict its search for Potential
Business Acquisitions to any particular industry or any particular geographic
area and may, therefore, engage in essentially any business to the extent of its
limited resources.
It is anticipated that knowledge of Potential Business Acquisitions will be
made known to the Registrant by various sources, including its officers and
directors, shareholders, professional advisors such as attorneys and
accountants, securities broker-dealers, venture capitalists, members of the
financial community, and others who may present unsolicited proposals. In
certain circumstances, the Registrant may agree to pay a finder's fee or to
otherwise compensate such persons for services rendered in bringing about a
transaction. However, no cash finder's fee shall be paid to any officer or
director of the Registrant or their affiliates or associates. The amount of any
such finder's fee or other compensation which may be paid to such persons for
services rendered in bringing about a transaction is subject to future
negotiation between the Registrant, the entity to be acquired and the finder.
2
<PAGE>
SELECTION OF OPPORTUNITIES
The analysis of new business opportunities has and will be undertaken by or
under the supervision of the officers and directors of the Registrant, none of
whom is a professional business analyst or has any previous training or
experience in business analysis or in selecting or hiring business analysts. The
Registrant has, since the date of the closing of its public offering, considered
potential acquisition transactions with several companies but as of this date
has not entered into any definitive agreement with any party. The Registrant has
unrestricted flexibility in seeking, analyzing and participating in Potential
Business Opportunities. In its efforts to analyze potential acquisition targets,
the Registrant will consider the following kinds of factors:
(a) Potential for growth, indicated by new technology, anticipated market
expansion or new products;
(b) Competitive position as compared to other firms of similar size and
experience within the industry segment as well as within the industry
as a whole;
(c) Strength and diversity of management, either in place or scheduled for
recruitment;
(d) Capital requirements and anticipated availability of required funds, to
be provided by the Registrant or from operations, through the sale of
additional securities, through joint ventures or similar arrangements
or from other sources;
(e) The cost of participation by the Registrant as compared to the
perceived tangible and intangible values and potentials;
(f) The extent to which the business opportunity can be advanced;
(g) The accessibility of required management expertise, personnel, raw
materials, services, professional assistance and other required items;
and
(h) Other relevant factors.
In applying the foregoing criteria, no one of which will be controlling,
management will attempt to analyze all factors in the circumstances and make a
determination based upon reasonable investigative measures and available data.
Potentially available business opportunities may occur in many different
industries and at various stages of development, all of which will make the task
of comparative investigation and analysis of such business opportunities
extremely difficult and complex. Due to the Registrant's limited capital
available for investigation and management's limited experience in business
analysis, the Registrant may not discover or adequately evaluate adverse facts
about the opportunity to be acquired.
3
<PAGE>
FORM OF ACQUISITION
The manner in which the Registrant participates in an opportunity will
depend upon the nature of the opportunity, the respective needs and desires of
the Registrant and the promoters of the opportunity, and the relative
negotiating strength of the Registrant and such promoters.
It is likely that the Registrant will acquire its participation in a
business opportunity through the issuance of common stock or other securities of
the Registrant. Although the terms of any such transaction cannot be predicted,
it should be noted that in certain circumstances the criteria for determining
whether or not an acquisition is a so-called "tax free" reorganization under
Section 368(a)(1) of the Internal Revenue Code of 1986, as amended (the "Code"),
depends upon the issuance to the shareholders of the acquired company of at
least 80 percent common stock of the combined entities immediately following the
reorganization. If a transaction were structured to take advantage of these
provisions rather than other "tax free" provisions provided under the Code, all
prior shareholders would in such circumstances retain 20% or less of the total
issued and outstanding shares. This could result in substantial additional
dilution to the equity of those who were shareholders of the Registrant prior to
such reorganization.
The present shareholders of the Registrant will likely not have control of
a majority of the voting shares of the Registrant following a reorganization
transaction. As part of such a transaction, all or a majority of the
Registrant's directors may resign and new directors may be appointed without any
vote by shareholders.
In the case of an acquisition, the transaction may be accomplished upon the
sole determination of management without any vote or approval by shareholders.
In the case of a statutory merger or consolidation, it will likely be necessary
to call a shareholders' meeting and obtain the approval of the holders of a
majority of the outstanding shares. The necessity to obtain such shareholder
approval may result in delay and additional expense in the consummation of any
proposed transaction and will also give rise to certain appraisal rights to
dissenting shareholders. Most likely, management will seek to structure any such
transaction so as not to require shareholder approval.
It is anticipated that the investigation of specific business opportunities
and the negotiation, drafting and execution of relevant agreements, disclosure
documents and other instruments will require substantial management time and
attention and substantial cost for accountants, attorneys and others. If a
decision is made not to participate in a specific business opportunity, the
costs theretofore incurred in the related investigation would not be
recoverable. Furthermore, even if an agreement is reached for the participation
in a specific business opportunity, the failure to consummate that transaction
may result in the loss to the Registrant of the related costs incurred.
EMPLOYEES
The Registrant currently has no employees.
4
<PAGE>
ITEM 2. DESCRIPTION OF PROPERTY
The Registrant has entered into an oral arrangement with Charles Rose,
President of the Registrant, providing for the use of a portion of his home as a
temporary office until such time as the Registrant needs additional facilities.
The Registrant will not pay rent for the use of such temporary facilities.
ITEM 3. LEGAL PROCEEDINGS
There are not presently any material pending legal proceedings to which the
Registrant is a party or as to which any of its property is subject and no such
proceedings are known to the Registrant to be threatened or contemplated against
it.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Registrant was formed on August 24, 1990, and no meetings of
shareholders have been held since its formation, nor has any matter been
submitted to a vote of security holders since such date.
5
<PAGE>
PART II
ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
A. Market for Common Stock. There is no public market for the
-----------------------
Registrant's common stock.
B. Holders. The number of record holders of the Registrant's common
-------
stock, as of September 15, 1997, was 39.
C. Dividends. The Registrant has not paid any cash dividends to date and
---------
does not anticipate or contemplate paying dividends in the foreseeable future.
It is the present intention of management to utilize all available funds for the
development of the Registrant's business.
D. Warrants. A total of 50,000 Units of the Registrant's securities were
--------
sold in the Registrant's initial public offering. Each Unit consisted of one
share of common stock, $.001 par value, one Class "A" Warrant to purchase one
share of Common Stock at $5.00 per share exercisable during an eighteen month
period commencing 30 days from the date of the closing of the offering and one
Class "B" Warrant to purchase one share of common stock at $10.00 per share
exercisable during a twenty four month period commencing 30 days from the date
of the close of the offering. The offering was closed on May 20, 1992. None of
the previously outstanding Class "A" Warrants and Class "B" Warrants was
exercised, and all Class "A" Warrants and Class "B" Warrants have expired in
accordance with their terms.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
The Registrant was formed on August 24, 1990 for the purpose of investing
in any and all types of assets, properties and businesses. In connection with
the initial capitalization of the Registrant, a total 12,500 shares of its
common stock were issued to its officers and directors for the aggregate sum of
$2,500. On November 12, 1991, the United States Securities and Exchange
Commission granted effectiveness to a Registration Statement on Form S-18, filed
by the Registrant in the New York Regional Office. The Registration Statement
was for an offering of 50,000 Units of Common Stock and Warrants to purchase
shares of Common Stock at $1.00 per Unit. The offering was closed in May 1992,
and the Registrant is currently seeking acquisition opportunities. The Plan of
Operation of the Registrant is further described in Item 1 of this Form 10-KSB.
As of June 30, 1996, the Registrant had cash of $10,683 and no other
assets. As of June 30, 1996, the Registrant had total liabilities of $2,736 and
total stockholders equity of $7,947. As of June 30, 1997, the Registrant had
cash of $7,502 and no other assets. As of June 30, 1997, the Registrant had
total liabilities of $1,938 and total stockholders equity of $5,564. Prior to
the consummation of a Potential Business Acquisition as described in Item 1 of
this Form 10-KSB, management does not expect that the Registrant will have any
significant capital requirements or that there will be significant changes in
the number of Registrant's employees.
6
<PAGE>
The Registrant has not commenced any active operations as of the date
hereof except for the registration and sale of its securities. The Registrant's
assets consist of a limited amount of cash. No revenue has been generated by the
Registrant since its inception. From inception to June 30, 1997, the Registrant
had a net loss of $36,765. The Registrant will not have significant operations
until, if ever, such time as it effects an acquisition.
LIQUIDITY AND CAPITAL RESOURCES
- - -------------------------------
As of June 30, 1997, the Company had working capital of $5,564.
The significant amount of capital necessary to acquire and develop a successful
business in today's economy will limit the Company's ability to locate one
suitable for acquisition or merger. Given the limited amount of working capital,
the potential venture is likely to involve the acquisition of, or merger with a
company which is not seeking immediate substantial amounts of cash but one which
desires to establish a public trading market for its shares. As indicated in the
Company's Notes to Financial Statements incorporated herein, the Company is
currently negotiating with Westbury Alloys, LLC, a privately held New York
limited liability company engaged in the smelting business, with respect to a
possible merger, but the final terms of such a transaction have not been
established as of the date of filing this report. There can be no assurance that
the Company will consummate a transaction with this or any other merger or
acquisition candidate. It is possible that the Company will require additional
financing to expand and fund any business which it acquires or establishes. If
additional funds are required, there can be no assurance given that additional
financing will be available on commercially reasonable terms or otherwise.
ITEM 7. FINANCIAL STATEMENTS
Index to Financial Statements
-----------------------------
Independent Auditor's Report
Year ended June 30, 1997
Year ended June 30, 1996
Balance Sheets
June 30, 1997 and 1996
Statement of Stockholders' Equity
Years ended June 30, 1997, 1996 and 1995 and for the period from
August 24, 1990 (inception) to June 30, 1997
Statement of Operations
Years ended June 30, 1997, 1996 and 1995 and for the period from
August 24, 1990 (inception) to June 30, 1997
7
<PAGE>
Statement of Cash Flows
Years ended June 30, 1997, 1996 and 1995 and for the period from
August 24, 1990 (inception) to June 30, 1997
Notes to Financial Statements
[Remainder of page intentionally left blank]
8
<PAGE>
[LETTERHEAD OF SCOTT & GUIFOYLE]
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders of
Rosecap, Inc.
We have audited the accompanying balance sheets of Rosecap, Inc. (a development
stage company) as of June 30, 1997 and 1996, and the related statements of
operations, stockholders' equity and cash flows for the years ended June 30,
1997, 1996 and 1995 and for the period August 24, 1990 (inception) to June 30,
1997. 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 Rosecap, Inc. (a development
stage company) as of June 30, 1997 and 1996 and the results of its operations
and its cash flows for the years ended June 30, 1997, 1996, 1995 and for the
period August 24, 1990 (inception) to June 30, 1997 in conformity with generally
accepted accounting principles.
/s/ Scott & Guilfoyle
Lake Success, New York
August 6, 1997
<PAGE>
ROSECAP, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
JUNE 30
1997 1996
ASSETS
CURRENT ASSETS
Cash $ 7,502 $10,683
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accrued expenses $ 1,938 $ 2,736
------- -------
TOTAL LIABILITIES 1,938 2,736
------- -------
STOCKHOLDERS' EQUITY
Common stock, $.001 par value
50,000,000 shares authorized, 87,500
and 62,500 shares issued and outstanding 88 63
Capital in excess of par value 42,241 37,266
Deficit accumulated during development stage (36,765) (29,382)
------- -------
TOTAL STOCKHOLDERS' EQUITY 5,564 7,947
------- -------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 7,502 $10,683
======= =======
The accompanying notes are an integral part of these financial statements.
<PAGE>
ROSECAP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Deficit Total
Common Stock Capital in Excess Accumulated During Stockholders'
Shares Amount Of Par Value Development Stage Equity
<S> <C> <C> <C> <C> <C>
Balance, August 24, 1990 (inception) 0 $ 0 $ 0 $ 0 $ 0
Issuance of shares to Officer and
Directors of the
Company for cash August 24, 1990 12,500 13 2,487 2,500
Net loss from inception to June 30, 1991 (976) (976)
Proceeds of initial public offering 50,000 50 49,950 50,000
Offering costs (14,394) (14,394)
Net loss for the year ended June 30, 1992 (3,991) (3,991)
Offering costs (777) (777)
Net loss for the year ended June 30, 1993 (5,854) (5,854)
Net loss for the year ended June 30, 1994 (5,662) (5,662)
Net loss for the year ended June 30, 1995 (6,491) (6,491)
------- --- ------- ------- -------
Balance, June 30, 1995 62,500 63 37,266 (22,974) 14,355
Net loss for the year ended June 30, 1996 (6,408) (6,408)
Balance, June 30, 1996 62,500 63 37,266 (29,382) 7,947
Issuance of common shares, May 10, 1997 25,000 25 4,975 0 5,000
Net loss for the year ended June 30, 1997 0 0 0 (7,383) (7,383)
------- --- ------- ------- -------
Balance, June 30, 1997 87,500 $88 $ 42,241 $(36,765) $ 5,564
======= === ======== ======== =======
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
ROSECAP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
FROM INCEPTION
FOR THE YEARS ENDED AUGUST 24, 1990
JUNE 30 TO
1997 1996 1995 JUNE 30, 1997
REVENUE
Interest NONE NONE NONE NONE
---- ---- ---- ----
EXPENSES
Miscellaneous 9 15 0 224
Office 0 0 150 2,400
Professional 6,114 5,204 5,486 27,200
Filing and transfer fees 889 768 434 4,012
-------- ------- ------- --------
TOTAL 7,012 5,987 6,070 33,836
-------- ------- ------- --------
LOSS BEFORE INCOME TAXES (7,012) (5,987) (6,070) (33,836)
INCOME TAXES 371 421 421 2,929
-------- ------- ------- --------
NET LOSS $ (7,383) $(6,408) $(6,491) $(36,765)
======== ======= ======= ========
LOSS PER SHARE
Net loss per share $ (.11) $ (.10) $ (.10) $ (.73)
======== ======= ======= ========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 66,062 62,500 62,500 50,413
======== ======= ======= ========
The accompanying notes are an integral part of these financial statements.
<PAGE>
ROSECAP, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FROM INCEPTION
FOR THE YEARS ENDED AUGUST 24, 1990
JUNE 30 TO
1997 1996 1995 JUNE 30, 1997
CASH FLOWS FROM OPERATING
ACTIVITIES
Net loss $ (7,383) $ (6,408) $ (6,491) $(36,765)
Increase (decrease) in
accrued expenses (798) 615 342 1,938
-------- -------- -------- --------
NET CASH USED BY OPERATING
ACTIVITIES (8,181) (5,793) (6,149) (34,827)
-------- -------- -------- --------
CASH FLOWS FROM FINANCING
ACTIVITIES
Issuance of common stock 25 0 0 88
Paid in capital 4,975 0 0 57,412
Offering costs 0 0 0 (15,171)
-------- -------- -------- --------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 5,000 0 0 42,329
-------- -------- -------- --------
NET INCREASE (DECREASE) IN CASH (3,181) (5,793) (6,149) 7,502
BEGINNING CASH BALANCE 10,683 16,476 22,625 0
-------- -------- -------- --------
ENDING CASH BALANCE $ 7,502 $ 10,683 $ 16,476 $ 7,502
======== ======== ======== ========
The accompanying notes are an integral part of these financial statements.
<PAGE>
ROSECAP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997, 1996, 1995
NOTE 1; SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION BUSINESS ACTIVITY AND DIVIDEND POLICY
The Company was incorporated under the laws of the State of New York on August
24, 1990. The Company is in the development stage and has not commenced planned
principal operations. The Company is seeking the acquisition of, or merger with
an existing Company. The fiscal year of the corporation is June 30. The Company
has, at the present time, not paid any dividends and any dividends that may be
paid in the future will depend upon the financial requirements of the Company
and other relevant factors.
Estimates
- - ---------
The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts
and disclosures. Actual results could differ from those estimates and
assumptions.
General and related party
- - -------------------------
The Company is seeking the acquisition of, or merger with an existing company.
Mr. Charles Rose is primarily responsible for evaluating acquisitions and
investigating prospects for the Company. The Company entered into an oral
arrangement with Charles Rose, President of the Company, providing for the use
of a portion of his business office as a temporary office until such time as the
Company needs additional facilities. The Company does not pay rent for the use
of such facilities. The office is located at 236 Birchwood Road, Medford, NY
11763.
Income taxes
- - ------------
As of June 30, 1997, the Company had a $36,765 net operating loss carryforward
available to offset future taxable income through 2006.
NOTE 2: CAPITAL STOCK
The Company in order to satisfy its cash requirements, consummated the sale of
25,000 shares of Common Stock to Lawrence Kaplan on May 10, 1997 for a total of
$5,000. Lawrence Kaplan is the son-in-law of Charles and Ida Rose, officers and
directors of the Company.
NOTE 3: SUPPLEMENTAL CASH FLOW INFORMATION
The following were paid during the year ended June 30, 1997:
Income taxes $404
<PAGE>
ROSECAP, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997, 1996, 1995
NOTE 4: MERGER DISCUSSIONS
The Company is in the midst of merger talks with Westbury Alloys, LLC, a
privately held corporation engaged in the smelting business. As part of the
proposed transaction, the Company intends to offer for sale certain units of its
Common Shares in an effort to provide additional financing to the business
ventures of the surviving corporation. Each unit would consist of 10,000 shares
of Common Stock, 10,000 Class A Warrants and 10,000 Class B Warrants. The Class
A Warrants would be exercisable to purchase one share of Rosecap Common Stock
for $4.50 and each Class B Warrant would be exercisable for $6.50 per share.
Both warrants would be exercisable for a period of five years. There is no
guarantee that the merger or private placement will take place.
<PAGE>
ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
There are not and have not been any disagreements between the Registrant
and its accountants on any matter of accounting principles, practices or
financial statement disclosure.
PART III
ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
A. Identification of Directors and Executive Officers. The current
--------------------------------------------------
officers and directors have served as officers and directors of the Registrant
since the inception of the Registrant in August 1990, and will serve for one
additional year or until their respective successors are elected and qualified.
They are:
NAME AGE DATE OF POSITION
- - ---- --- ------- --------
ELECTION
--------
Charles Rose 83 August 1990 President/Treasurer
236 Birchwood Road
Medford, NY 11763
Ida Rose 82 August 1990 Secretary/Director
236 Birchwood Road
Medford, NY 11763
Paul O'Donnell 35 August 1990 Director
3329 Rt. 9N
Greenfield Center
NY 12833
Charles Rose. Mr. Rose has been retired for over ten years from his
------------
practice as a podiatrist. Mr. Rose was previously an officer and director of
Jericap, Inc., a blind-pool/blank check company. Mr. Rose also was previously an
officer and director of IDF International, Inc., a publicly held company.
Ida Rose. Mrs. Rose has been a housewife for most of her adult life. Mrs.
--------
Rose was previously an officer and director of IDF International, Inc.
16
<PAGE>
Paul O'Donnell. Since 1992, Mr. O'Donnell has been President of Celtic
--------------
Treasures - O'Donnell's Irish Imports, Inc. Mr. O'Donnell was employed by Ag-bag
Corporation as northeast manager from January 1990 through 1992. From March 1988
to December 1989, he was employed by Saratoga Fence Corp. as New England sales
manager. From June 1984 to March 1988, Mr. O'Donnell was employed by Saratoga
Standardbreds, Inc. as director of public relations.
B. Significant Employees. None.
---------------------
C. Family Relationships. Charles Rose is the husband of Ida Rose.
--------------------
D. Involvement in Certain Legal Proceedings. Except as indicated below,
----------------------------------------
there have been no events under any bankruptcy act, no criminal proceedings and
no judgments or injunctions material to the evaluation of the ability and
integrity of any director, executive officer, promoter or control person of
Registrant during the past five years.
E. Compliance With Section 16(a). The Registrant is not subject to
-----------------------------
Section 16 of the Exchange Act.
ITEM 10. EXECUTIVE COMPENSATION
No compensation has been paid or accrued to any officer or director of the
Registrant. The current officers and directors are not being compensated by the
Registrant. The Registrant has no current intent to issue shares of its common
stock to management in connection with an acquisition. However, the Registrant
may subsequently deem the issuance of shares to management for services rendered
in connection with an acquisition to be fair and reasonable to the Registrant
and its public shareholders in light of the services rendered. In the event any
shares are issued for services rendered by management they shall be issued in
such an amount as the Board of Directors deems fair and reasonable to the
Registrant and its public shareholders and in compliance with management's
fiduciary duties under state law. Subsequent to the time the Registrant
completes an acquisition, it will enter into new employment arrangements with
the individuals who are then officers and directors of the Registrant, the terms
of which will be dictated by the nature of the acquisition made. Officers and
directors will be reimbursed for actual out-of-pocket expenses incurred on
behalf of the Registrant as approved by the Board of Directors.
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
A. Security Ownership of Certain Beneficial Owners. The following persons
-----------------------------------------------
are known to the Registrant to be the beneficial owners of more than five
percent of the Registrant's common stock as of September 15, 1997:
17
<PAGE>
Amount and
Name and Address Nature of
of Beneficial Owner Beneficial Owner (1) Percent of Class
- - ------------------- -------------------- ----------------
Lawrence Kaplan 25,000 28.6%
150 Vanderbilt Motor Parkway
Hauppauge, NY 11788
Charles Rose 10,500 12.0%
236 Birchwood Road
Medford, NY 11763
President/Treasurer/Director
Ida Rose 1,000 1.0%
236 Birchwood Road
Medford, NY 11763
Secretary/Director
Paul O'Donnell 1,000 1.0%
3329 Rt. 9N
Greenfield Center, NY 12833
Director
GSM Consulting 5,000 5.7%
501 Fifth Avenue
New York, NY 10017
ALL OFFICERS AND DIRECTORS
AS A GROUP (3 Individuals) 12,500 14.3%
- - -----------------------------
(1) All shares are held beneficially and of record and each record shareholder
has sole voting and investment power.
B. Security Ownership of Management. See Item 11(a) above.
--------------------------------
C. Changes in Control. The Registrant is contemplating a merger or
------------------
acquisition, which, when consummated, will result in a change of control of the
management of the Registrant as well as a change in the voting control of the
outstanding securities of the Registrant.
18
<PAGE>
ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Registrant borrowed $5,000 from its President, Charles Rose, at the
time of the formation of the Registrant which was used to fund costs incurred
with the registration and distribution of the Units. The loan was interest free
and was repaid with the proceeds of the public offering.
The Registrant presently utilizes the home of its President, Charles Rose,
as its office, at no cost to the Registrant.
The Registrant sold 12,500 shares of its common stock to its founding
shareholders for an aggregate consideration of $2,500 in cash in connection with
its initial capitalization.
The Company in order to satisfy its cash requirements, consummated the sale
of 25,000 shares of Common Stock to Lawrence Kaplan on May 10, 1997 for a total
of $5,000. Lawrence Kaplan is the son-in-law of Charles and Ida Rose, officers
and directors of the Company.
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits.
--------
3.1 Certificate of Incorporation - incorporated by reference to
Exhibit 3.1 to Registration Statement on Form S-18 (SEC File No. 33-42408-NY).
3.2 Bylaws - incorporated by reference to Exhibit 3.2 to Registration
Statement on Form S-18 (SEC File No. 33-42408-NY).
27.1 Financial Data Schedule.
B. Reports on Form 8-K. No Reports on Form 8-K were filed by the
-------------------
Registrant during the fourth quarter of its last fiscal year.
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK.
19
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ROSECAP, INC.
Dated: September _____, 1997
By: /s/ Charles Rose
---------------------------
Charles Rose
Principal Executive Officer
Principal Financial Officer
In accordance with the Exchange Act, 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/ Charles Rose President/Treasurer September ______, 1997
- - ------------------ Director
Charles Rose
/s/ Paul O'Donnell Director September ______, 1997
- - ------------------
Paul O'Donnell
/s/ Ida Rose Secretary/Director September _______, 1997
- - ------------------
Ida Rose
Supplemental Information to be Furnished With
Reports Filed Pursuant to Section 15(d) of the Exchange Act
by Non-reporting Issuers
No annual report to security holders or proxy material has been sent to security
holders of the Registrant.
