UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB/A
QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
(Mark One)
(X) Quarterly report pursuant to section 13 or 15 (d) of the Securities
Exchange Act of 1934, for the quarterly period ended March 31, 1998.
( ) Transition report pursuant to section 13 or 15 (d) of the Securities
Exchange Act of 1934,
For the Quarterly Period Ended March 31, 1998
Commission file number 33-42408-NY
ROSECAP, INC.
(Exact name of small business issuer as specified in its charter)
New York #11-3023099
(State of Incorporation) (I.R.S. Employer ID No.)
750 Shames Drive, Westbury, New York 11590
(Address of Principal Executive Offices)
(516) 997-8333
(Issuer's Telephone Number)
N/A (Former name, former address and former fiscal year, if changed since
last report)
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.
Yes X No
There were 3,077,836 shares of the registrant's common stock outstanding as of
March 31, 1998.
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<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
ROSECAP INC, AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
For The Nine For The Three
Months Ended March 31, Months Ended March 31,
1998 1997 1998 1997
------------------------------ -----------------------------
Revenues:
Refining fees $1,322,378 $1,084,740 $ 797,535 $ 474,340
Other income 119,421 _________ 46,628 _________
Total revenues 1,441,799 1,084,740 844,163 474,340
Costs and expenses:
Cost of refining 543,224 383,722 278,807 147,425
Selling general and administrative 818,230 623,216 563,803 230,387
Depreciation and amortization 210,545 93,814 151,672 26,087
Interest 153,786 55,540 38,190 24,627
Total costs and expenses 1,725,785 1,156,292 1,032,472 428,526
Loss before provision for income taxes (283,986) (71,552) (188,309) 45,814
Provision for income taxes (19,657) (19,657)
Net Income (Loss) $(303,643) $ (71,552) $(207,966) $ 45,814
============================== ==============================
Net Income (Loss) Per Share - Basic $ (0.16) $ (0.04) $ (0.11) $ 0.02
------------------------------ ------------------------------
Net Income (Loss) Per Share - Diluted $ (0.16) $ (0.04) $ (0.11) $ 0.02
------------------------------ ------------------------------
Average Shares Outstanding - Basic 1,850,000 1,850,000 1,850,000 1,850,000
============================== ==============================
Average Shares Outstanding - Diluted 1,850,000 1,850,000 1,850,000 1,850,000
============================== ==============================
<PAGE>
ROSECAP INC, AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
MARCH 31, JUNE 30,
1998 1997
---------------- ------------------
ASSETS
-----------
CURRENT ASSETS:
Cash $ 2,167,734 $ 73,136
Accounts receivable 127,167 77,590
Inventory 720,948
Due from affiliate 81,445
Prepaid expenses and other current assets 697,444 624,887
---------------- ------------------
Total Current Assets 2,992,345 1,578,006
---------------- ------------------
PROPERTY PLANT AND EQUIPMENT:
Property and Equipment 501,331 425,448
Accumulated Depreciation (132,893) (78,239)
---------------- ------------------
Net Property Plant and Equipment 368,438 347,209
---------------- ------------------
OTHER ASSETS:
Goodwill-net of accumulated amortization 240,960
233,220
Deposits 21,063
37,208
---------------- ------------------
Total Other Assets 262,023
270,428
---------------- ------------------
TOTAL ASSETS $ 3,631,211 $ 2,187,238
================ ==================
LIABILITIES AND STOCKHOLDERS' EQUITY
--------------------------------------------------------
CURRENT LIABILITIES:
Loans payable $ $ 973,046
Current portion of long-term debt 553,906
Due to customers 645,172 439,703
Accounts payable and accrued expenses 635,366 208,266
---------------- ------------------
Total Current Liabilities 1,280,538 2,174,921
----------------
------------------
Long-term debt - net of current portion 15,077
------------------
STOCKHOLDERS' EQUITY:
Common stock $.001 par value; Authorized 50,000,000 shares; issued and
outstanding 3,077,836 shares and 1,850,000 shares at
March 31, 1998 and June 30,1997 respectively 3,078 1,850
Capital in excess of par 2,853,998
Stock subscription receivable (100,000) 98,150
Accumulated earnings (deficit) (406,403) (102,760)
---------------- ------------------
Total Stockholders' Equity 2,350,673
(2,760)
---------------- ------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 3,631,211 $ 2,187,238
================ ==================
<PAGE>
ROSECAP INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
For The Nine
Months Ended
March 31,
1998 1997
-------------------------------
Operating activities:
Net loss $(303,643) $ (71,552)
Adjustments to reconcile net loss to net
cash provided (used) by operating activities:
Depreciation and amortization (non-cash portion) 70,799
93,814
Changes in assets and liabilities:
Accounts receivable (49,577)
(26,466)
Inventory 720,948 (1,479,376)
Due from affiliates 81,445
Prepaid expenses and other current assets (72,557) (130,873)
Deposits (16,145)
(23,090)
Due to customers 205,469 712,214
Accounts payable and accrued expenses net
of liabilities acquired in merger 418,314 168,654
Net cash used by operating activities 1,055,053 (756,675)
Investing activities
Intangible costs related to acquisition of Westbury Refining (301,200)
Equipment additions (75,883) (409,653)
Net cash used by investing activities (75,883) (710,853)
Financing activities
Issuance of common stock 2,016,039
Stock subscription receivable (100,000)
Loans payable (973,046) 1,098,795
Bridge financing 700,000
Long-term debt (568,983) 570,052
Net cash provided by financing activities 1,074,010 1,668,847
Cash from merged subsidiary 41,418
Cash - beginning __________
73,136
CASH - ENDING $ 2,167,734 $ 201,319
===============================
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ROSECAP, INC. AND SUBSIDIARIES
FORM 10-QSB/A
For the Quarter Ended March 31, 1998
Note 1 - General
The accompanying financial information should be read in conjunction
with the audited financial statements including the notes there to, as
of and for the year ended June 30, 1997. The March 31, 1998 statements
have been amended to show the accounting treatment for the merger of
Westbury Alloys, Inc and Rosecap, Inc. as Westbury Alloys, Inc. being
the acquirer rather than Rosecap, Inc..
The information furnished in this report reflects all adjustments
(consisting of only normal recurring accruals) which are, in the
opinion of management, necessary for a fair statement of the results
for the interim periods.
Note 2 - Merger
On March 31, 1998 Rosecap, Inc. (the "Company") entered into a Merger
(the "Merger") between Westbury Acquisition Corp. ("WAC"), a wholly
owned subsidiary of the Company, and Westbury Alloys, Inc.,
("Westbury") a Delaware Corporation, the surviving entity. The Merger
is a reverse merger whereby the principals of Westbury became the
principals of the Company the largest shareholders of the Company. The
Company commenced operating the business of Westbury after the
consummation of the Merger. Prior to the Merger, the Company, which was
incorporated in 1990, had not conducted any operations and reported as
a development stage enterprise.
Westbury provides a broad range of processing, refining and financial
services in connection with the reclamation of precious and specialty
metals from scrap materials. Westbury reclaims principally gold,
silver, platinum and palladium from scrap and residues from the
electronics, jewelry, petroleum, dental, chemical, automotive, mining
and aerospace industries. After controlled weighing, sampling, and
assaying to determine values and to settle with the customer, Westbury
either purchases the precious metal or returns metal to the customer.
For each service in the process, the Company receives an agreed upon
fee. Westbury also conducts precious metals transactions that rely on
Westbury's commercial credit and convenience capabilities.
Gold and silver comprise the major portion of the value of Westbury's
precious metal inventory which may be held under certain consignment
agreements (see note 4). The prices of gold and silver are subject to
fluctuations and are expected to continue to be affected by world
market conditions. Westbury maintains inventories of precious metals in
various stages of processing. Westbury also maintains inventories at
independent outside refineries. Such inventories are carried on its
books at current market value.
The shareholders of Westbury received 1,850,000 shares of common stock of
Rosecap, Inc. in conjunction with the merger.
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Note 3 - Private Placement
The Company entered into an agreement to offer up to 2,175,000 shares
of common stock to investors at an offering price of $3.00 per share.
As of March 31, 1998 the Company sold 1,005,836 shares of common stock
and received proceeds, net of offering costs, of $2,016,632.
Prior to the Offering, certain investors provided Bridge Financing to
Westbury in the amount of $700,000 and received promissory notes (the
"Notes"). The investors in the Bridge Financing also received as
additional consideration, 700,000 Class A Redeemable Warrants (the
"Bridgeholders' Warrants") which permit 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 commencing on March 31, 1998.
On March 31, 1998, the Notes automatically converted into 233,333
Shares of the Company's Common Stock as part of the 1,005,836 Shares of
Common Stock sold.
Note 4 - Inventories
Inventories are stated at the lower of cost (first-in, first out basis)
or market value. Consistent with other companies that refine and
produce precious metal fabricated products, some of the Company's gold
and silver requirements are furnished by customers and suppliers on a
consignment basis. Title to the consigned gold and silver remains with
the Consignor. The value of consigned gold and silver held by the
Company is not included in the Company's Balance Sheet. At March 31,
1998 the company held $2,382,220 of Gold and Silver under a consignment
agreement with Republic National Bank. The Company's gold and silver
requirements are provided from a combination of owned inventories,
precious metals which have been purchased and sold for future delivery,
and gold and silver received from suppliers and customers on a
consignment basis.
Note 5 - Net Income (Loss) per Common Share
Basic net income (loss) per common share is calculated using the
weighted average number of common shares outstanding during the period.
Diluted income (loss) per share is calculated by including all dilutive
potential common shares such as stock options and warrants. Potential
common shares are not included for the nine and three month periods
ended March 31, 1998, included in the statement of operations because
they would be anti-dilutive. For the nine and three months ended March
31, 1997 there were no additional shares that would be dilutive.
Prior to the Merger and Private Placement the Company completed a
1.057142 for 1 stock dividend increasing the outstanding shares of the
Company from 87,500 shares to 180,000 shares. The dividend is reflected
in all periods presented.
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SIGNATURE
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
ROSECAP, INC.
By:
David Nadler
Chief Financial Officer
Date: May 18, 1999
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<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS CONTAINED IN THE COMPANY'S FORM 10-QSB/A AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-START> JUL-1-1997
<PERIOD-END> JUN-30-1998
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 127,167
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,992,345
<PP&E> 501,331
<DEPRECIATION> 132,893
<TOTAL-ASSETS> 3,631,211
<CURRENT-LIABILITIES> 1,280,538
<BONDS> 0
0
0
<COMMON> 3,078
<OTHER-SE> 2,347,595
<TOTAL-LIABILITY-AND-EQUITY> 3,631,211
<SALES> 1,322,378
<TOTAL-REVENUES> 1,441,799
<CGS> 543,224
<TOTAL-COSTS> 1,361,454
<OTHER-EXPENSES> 1,028,775
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 153,786
<INCOME-PRETAX> (283,986)
<INCOME-TAX> 19,657
<INCOME-CONTINUING> (303,643)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (303,643)
<EPS-PRIMARY> (.16)
<EPS-DILUTED> (.16)
</TABLE>
