UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB
(Mark One)
[ ] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [Fee Required]
[X] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIE
EXCHANGE ACT OF 1934 [No Fee Required]
For the transition period from December 31, 1996 to September 30, 1997
Commission file number 0-2252
-------------------------
SeaCrest Industries Corporation
---------------------------------------
(Name of small business issuer in its charter)
Delaware 13-1976670
- ----------------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2510 N. Grand Ave, Suite 104, Santa Ana, CA 92701
- ------------------------------------------- -------------------------------
(Address of principal executive offices) (Zip Code)
Issuer s telephone number: (714) 532-5216
Securities registered under Section 12(b) of the Exchange Act:
Title of each class Name of each exchange on which registered
- ------------------------- ------------------------------------------------
- ------------------------- ------------------------------------------------
Securities registered under Section 12(g) of the Exchange Act;
(Title of class)
- ------------------------------------------------------------------------------
Common Stock, par value $0.01
- ------------------------------------------------------------------------------
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 [ ] No
[X]
Check if there is no disclosure of delinquent filers in response to Item 405
of Regulation S-B is not 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 Form 10-KSB or
any amendment to this Form 10-KSB.
State issuer s revenues for its most recent fiscal year. $77,184
State the aggregate market value of the voting stock held by non-affiliates
computed by reference to the price at which the stock was sold, or the average
bid and asked price, as of a specified date within the past 60 days. 0
State the number of shares outstanding of each of the issuer s classes
of common equity, as of the latest practicable date. 12,484,798
<PAGE>
PART I
Item 1. Description of Business.
Sea Crest Industries Corporation, a Delaware corporation (the "Company"),
was formed in 1959. From 1974 through 1979 the Company engaged in land sales in
Texas and Idaho as well as insurance operations in Hawaii. In 1977, the
insurance operations ceased and by 1979 the Company's last land operations had
either been sold or foreclosed upon. At that time the Company ceased operations.
In 1983, C. M. Ball was elected president of the Company. The Company then
had 12,484,798 shares issued and outstanding and began to look for acquisitions
such that the Company would have operations.
In May of 1997, the Company entered into an agreement whereby the Company
agreed to reorganize as a Nevada corporation, effecting a one for two reverse
split and to issue 50,204,102 shares to acquire Infrared Systems International,
a Nevada corporation ("ISI"), the licensee of certain technology relating to
infrared sensing for use in Enhanced Vision Systems ("EVS").
Gary E. Ball, the brother of C. M. Ball, formed ISI in 1992. In June of
1992, Gary E. Ball was employed as the program manager of EVS at Hughes Aircraft
where he developed the technology, including the principal patent, licensed to
the Company. In October of 1995, in connection with certain strategic business
decisions being made by Hughes Aircraft, Hughes Aircraft offered Mr. Gary E.
Ball a license of the EVS technology. The license included the patent submitted
by Mr. Gary E. Ball and others, together with proprietary data related to the
technology, proprietary business agreements, and unrestricted use of the
licensed information and EVS knowledge acquired while Mr. Gary E. Ball was at
Hughes Aircraft.
The license agreement with Hughes required a prepayment and a royalty on
each licensed product sold. The license is exclusive and limited to use of the
technology relating to commercial aircraft licensed to operate by the United
States Federal Aviation Administration or equivalent regulatory agency
elsewhere. The agreement requires the consent of Hughes Aircraft to sublicense
the technology, which consent will not be unreasonably withheld.
ISI initially reached an agreement with Loral Fairchild Corporation
wherein that entity would acquire ISI. That agreement did not close and is now
the subject of litigation. See "Item 3. Legal Proceedings."
In May of 1997, ISI entered into a license agreement with Kollsman, Inc.
which contemplates the payment of a royalty based upon the number of licensed
products sold by Kollsman and requires the personal consulting services of Mr.
Gary E. Ball for which the Company will receive compensation. This agreement
entitles ISI to an advanced royalty of $5,000 per month plus time and expenses
for consulting services as well as an initial $20,000 advance. The royalty,
based upon sales, decreases as the number of systems sold increases. While there
can be no assurance of the ultimate amount of royalties generated over the term
of the agreement, management of ISI estimates that there will be approximately
$33,000,000 in royalties.
Kollsman, Inc. is a commercial avionics and electronics company that
designs, develops and manufactures flight instruments. It is a leading developer
of Forward Looking Infrared Systems. These systems have primarily been utilized
in military applications.
The system designed by Kollsman that utilizes the Company's technology is
based upon an infrared sensor unit placed in the nose of the aircraft. Output
from the sensor unit is transmitted through a video interface and onto a heads
up display located in an aircraft's cockpit. The image displayed approaches the
quality of a black and white television image. The result is that night vision
is enhanced and a pilot has the ability to see through fog, smoke, haze, rain
and snow. In addition to improved situational awareness of the airport, traffic
and surrounding terrain, the takeoff and landing minima resulting in fewer
diversions, cancellations and delays.
In October of 1997, Gulfstream, a manufacturer of large business aircraft,
and Kollsman announced the execution of a memorandum of understanding to utilize
the Company's technology on Gulfstream IV-SP and Gulfstream V aircraft.
Gulfstream announced it is preparing for pre-prototype flight tests whose goal
is to utilize the technology where the visual ceiling is no more than 50 feet
and the runway visual range is no more than 700 feet.
While the Company's primary efforts are directed toward supporting the
Kollsman license, the Company is pursuing other areas of development for the
Enhanced Vision Systems Technology. Not only can the technology can be used in a
variety of cameras to reveal images through clouds or smoke but also to reveal
critical characteristics that would otherwise not be seen such as
characteristics of paintings and cattle. There are a multitude of medical
applications, applications for preventative maintenance, uses in underwater
imaging systems and emergency vehicle warning systems.
Plan of Operation
The Company's primary focus over the next several months will be to
support the Kollsman licensing contract. While supporting this agreement, the
Company plans to develop other commercial applications of the technology.
Proprietary Technology
The Company's technology rests upon the license of the patent and
proprietary information licensed from Hughes Aircraft. Hughes Aircraft has
determined to not pursue the technology's development at this time. Hughes
Aircraft, however, could license the technology to others or determine to
develop the technology itself.
Notwithstanding the foregoing, the technology, including the patent, was
developed by ISI's president, Mr. Gary E. Ball and he is continuing to develop
and refine the technology.
Competition
ISI's technology competes with a number of vision enhancing devices. These
devices include systems based not only on infrared technology but also on radar
based technology. There are numerous entities possessing or developing radar and
infrared vision enhancing technologies or other technologies. Many of these
entities are quite large, possess significantly greater financial, technical and
managerial resources, among other resources, than resources possessed by the
Company or ISI.
ISI believes, however, that its technology is a cost effective, real-time
solution to vision enhancing. It is ISI's plan to exploit this technology.
Employees
The Company's only employee is Mr. Gary E. Ball.
Item 2. Description of Property
The Company leases 500 square feet of office space in Beverly Hills,
California, for which it pays $1,000 per month. Until ISI develops additional
applications or enters into a more rigorous engineering effort, ISI does not
plan to expand its present office space.
Item 3. Legal Proceedings.
On October 7, 1997, ISI filed a lawsuit in the Superior Court of Orange
County, California, against Loral Fairchild Corporation, a subsidiary of Loral
Corporation for breach of contract or fraud seeking in excess of $20,000,000 in
damages. The suit is based upon a contract under which Loral Fairchild was to
acquire ISI. Lockheed Martin Corporation now owns Loral Corporation and has
filed a counterclaim against ISI asserting various claims for alleged
on-disclosure by ISI. The management of ISI believes that the counter claims are
without merit and perhaps frivolous. ISI plans to pursue aggressively the
litigation.
Item 4. Submission of Matters to a Vote of Security Holders.
The Company anticipates submitting in November of 1997 an Information
Statement to its security holders for ratification and adoption of the ISI
agreement of reorganization.
PART II
Item 5. Market for Common Equity and Related Stockholder Matters.
The Company's Common Stock is not traded. As of September 30, 1997 there
were 901 stockholders of record.
Item 6. Management's Discussion and Analysis or Plan of Operation.
The Company's liquidity is provided through its agreement with Kollsman.
Its revenues are derived from the license fees as well as the consulting fees
provided to Mr. Gary E. Ball. The Company's only expenses are limited to
payments to Mr. Gary E. Ball. For the nine months ended September 30, 1997, the
Company's revenues were $77,184 compared to revenues for the twelve months ended
December 31, 1996, of $51,503. The increase in revenues reflects the additional
consulting fees derived from the arrangement with Kollsman.
Item 7. Financial Statements.
The Financial Statements identified in the Index to Financial Statements
appearing under "Item 13.. exhibits, Financial Statement Schedules, and Reports
on Form 8-K" are incorporated by reference.
Item 8. Changes In and Disagreements with Accountants on Accounting and
Financial Matters.
In the summer of 1997, the Company engaged John Semmens CPA to audit the
books and records of the Company. The Company's books and records were
previously audited in 1978. The Company is unable to locate that firm, Louis Z.
Teitler, Certified Public Accountant.
PART III
Item 9. Directors, Executive Officers, Promoters and Control Persons; Compliance
with section 16(a) of the Exchange Act.
In May of 1997, Gary E. Ball and Wendy S. Ball were elected Directors of
the Company. At the same time, Gary E. Ball was elected as President of the
Company and Wendy S. Ball was elected as Secretary and Treasurer of the Company.
Gary E. Ball, age 60, has been President and Chief Executive Officer of
Infrared Systems International since 1992. From 1984 to 1992, Mr. Ball was
employed at Hughes Aircraft where he developed EVS for Hughes Aircraft while he
was Program Manager from 1989 to 1992. In addition, while at Hughes Aircraft,
Mr. Ball was the International Marketing Manager for the Tactical Avionics
Systems Division and also served as the Proposal and Program Manager for F-18
Thermal Imaging Navigation System. Prior to joining Hughes Aircraft in 1984, Mr.
Ball was the Program Manager for various optical systems at Ford Aerospace and
Northrop Aircraft. He is the author of several articles on Enhanced Vision
Systems, the author and presenter of papers at National Symposiums and has
participated in military advisory committees. He is the holder of three patents,
including the Company's licensed patent from Hughes Aircraft on EVS.
Wendy S. Ball, age55, is the spouse of Gary E. Ball. She has served as the
Secretary and Treasurer of Infrared Systems International since 1993 and was
elected as a director in 1994. From 1984 to 1993, Ms. Ball was an owner of two
clothing boutiques in Southern California. From 1995 to 1996 she was an Account
Manager and Executive for the West Coast Territory of Carolee Designs. Presently
she is a Boutique Manager for Paris Fashions Inc. in Beverly Hills, California.
Neither Mr. Gary E. Ball nor Wendy S. Ball have filed Form 3's, 4's, or
5's. The sole director prior to the election of the Balls was Mr. C.M. Ball. The
Company does not know if Mr. C. M. Ball has filed the required Form 3's, 4's or
5's since becoming a director in 1983. The Company does not know of any
stockholder at the present time that owns more than 1,250,000 shares of Common
Stock nor that will own more than 5,644,601 shares of Common Stock following the
consummation of the reorganization other than Mr Gary E. Ball and Wendy S. Ball
who will own 18,480,000 shares following the reorganization. The Company, in any
event, has not received any Form 3's, Form 4's or Form 5's filed on behalf of
such beneficial owner.
Item 10. Executive Compensation.
Gary E. Ball is paid $5,000 per month. For the year ended December 31,
1996, the Company paid Mr. Gary E. Ball $60,000 and for the nine month period
ended September 30, 1997, the Company paid Mr. Gary E. Ball $40,000. In
addition, the Company prepaid an automobile lease in 1997 for Mr. Gary E. Ball
in the amount of $17,439. No other executive is compensated.
Item 11. Security Ownership of Certain Beneficial Owners and Management.
Gary E. Ball and Wendy S. Ball, spouses, will own an aggregate of
18,480,000 shares of the Company's Common Stock following the reorganization of
the Company. This number of shares represents approximately 33% of the issued
and outstanding shares following the reorganization. Prior to the
reorganization, the Balls owned 18,480,000 shares of the Company's Common stock
or approximately 32.8% of its issued and outstanding shares.
Item 12. Related Party Transactions.
The Company is indebted to Equishare Financial, Inc. in the amount of
$17,432. Equishare Financial, Inc. is a wholly owned corporation of Mr. C.M.
Ball, a former director of the Company. In addition, in connection with the
acquisition of ISI by the Company, the Company issued to Equishare Financial,
Inc. an aggregate of 1,624,000 shares of Common Stock.
Item 13. Exhibits and Reports on Form 8-K.
(a)Exhibits
Financial Statements
Report of Independent Certified Accountant....................................3
Balance Sheet as of September 30, 1997........................................4
Statement of Operations
January 1, 1996 to December 31, 1996.........................................5
January 1, 1997, to September 30, 1997.......................................6
Statement of Changes in Stockholder's Equity for period
January 1,1996 to September, 30, 1997.......................................7
Statement of Cash Flows
January 1, 1996 to December 31, 1996........................................8
January 1, 1997 to September 30, 1997........................................9
Notes to Financial Statements................................................10
(b) Reports on Form 8-K.
None.
(c) Exhibit 23.1 Consent of Independent Accountant
<PAGE>
SeaCrest Industries Corporation
Financial Statements
and
Auditor's Report
September 30, 1997
<PAGE>
SeaCrest Industries Corporation
CONTENTS Page
Report of Independent Certified Public Accountant 3
Balance Sheet as of September 30, 1997 4
Statement of Operations
January 1, 1996 to December 31, 1996 5
January 1, 1997 to September 30, 1997 6
Statement of Changes in Stockholder's
Equity for period January 1, 1996
to September 30, 1997 7
Statement of Cash Flows
January 1, 1996 to December 31, 1996 8
January 1, 1997 to September 30, 1997 9
Notes to Financial Statements 10
<PAGE>
John P. Semmens CPA, A Professional Corporation
24501 Del Prado Suite A, Dana Point, CA 92629
(TEL) 714-496-8800 (FAX) 714-443-0642
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT
Board of Directors and Shareholders
SeaCrest Industries Corporation
I have audited the accompanying balance sheet of SeaCrest Industries Corporation
(a Nevada corporation) as of September 30, 1997 and the related statements of
operations, changes in stockholders' equity and cash flows for the periods
January 1, 1997 to September 30, 1997. These financial statements are the
responsibility of the Company's management. My responsibility is to express an
opinion on these financial statements based on my audit.
I conducted my audit in accordance with generally accepted auditing standards.
Those standards require that I 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.
I believe that my audit provides a reasonable basis for my opinion.
In my opinion the financial statements referred to above present fairly in all
material respects, the financial position of SeaCrest Industries Corporation as
of September 30, 1997 and the results of its operations and its cash flows for
the periods January 1, 1996 to September 30, 1997, in conformity with generally
accepted accounting principles.
John P. Semmens CPA
A Professional Corporation
Dana Point, California
October 21, 1997
[3]
SEACREST INDUSTRIES CORPORATION
BALANCE SHEET
September 30, 1997
<TABLE>
<CAPTION>
Infrared Seacrest
Systems Industries Combined
ASSETS International (Delaware) Proforma
<S> <C> <C> <C>
Current Assets
Cash in bank $ 281 $ 0 $ 281
Prepaid licence agreement (Note 1) 25,000 0 25,000
Prepaid automobile lease 17,439 0 17,439
-------- --------------- ---------
Total current assets 42,720 0 42,720
Other Assets
Organization costs 0 17,432 17,432
---------- --------- ---------
Total Assets $ 42,720 $ 17,432 $ 60,152
========== ========== ========
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities
Accrued legal $10,000 $ 0 $ 10,000
Note payable - Equishare Financial
Inc. (Note 2) 0 17,432 17,432
Advanced royalties 25,000 0 25,000
------ ---------- ------
Total current liabilities 35,000 17,432 52,432
Stockholders' Equity
Common Stock - $0.001 par value,
75,000,000 shares authorized,
56,446,501 issued and outstanding 7,720 0 7,720
-------- ---------- -------
Total Liabilities & Stockholders' Equity $44,720 $17,432 $60,152
======= ======= =======
</TABLE>
The accompanying notes are an integral part of these financial statements
[4]
SEACREST INDUSTRIES CORPORATION
STATEMENT OF OPERATIONS
For the period January 1, 1996 to December 31, 1996
<TABLE>
<CAPTION>
Infrared Seacrest
Systems Industries Combined
International (Delaware) Proforma
<S> <C> <C> <C>
Revenues $51,503 $ 0 $56,503
Expenses 47,053 0 47,053
-------- ------------- --------
Net Income $ 4,450 $ 0 $ 4,450
======= ============ =======
Net income per weighted-average share
of common stock outstanding $0.00008
Weighted-average number of shares
of common stock outstanding (after merger) 56,446,501
==========
</TABLE>
The accompanying notes are an integral part of these financial statements
[5]
SEACREST INDUSTRIES CORPORATION
STATEMENT OF OPERATIONS
For the period January 1, 1997 to September 30, 1997
<TABLE>
<CAPTION>
Infrared Seacrest
Systems Industries Combined
International (Delaware) Proforma
<S> <C> <C> <C>
Revenues $77,184 $ 0 $77,184
Expenses 92,336 0 92,336
------- ------------- -------
Net Income $ (15,152) $ 0 $ (15,152)
========== ============ ==========
Net income per weighted-average share
of common stock outstanding $(0.00027)
Weighted-average number of shares
of common stock outstanding (after merger) 56,446,501
==========
</TABLE>
The accompanying notes are an integral part of these financial statements
[6]
<PAGE>
SEACREST INDUSTRIES CORPORATION
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
For the period January 1, 1997 to September 30, 1997
<TABLE>
<CAPTION>
Common Stock
Combined Infrared SeaCrest
Proforma Systems Industries Combined
Shares International (Delaware) Proforma
<S> <C> <C> <C> <C>
Issuance of stock at
initiation of operations:
SeaCrest Industries Corporation
(A Delaware Corporation) 12,484,798 $ - $ - $ -
Infrared Systems International, Inc.
(A Nevada Corporation) 16,501,465 7,720 - 7,720
Stock transactions subsequent to
initiation of operations:
Reverse stock split SeaCrest
Industries Corporation
(A Delaware Corporation) (6,242,399) - - -
Redistribution of shares of
Infrared Systems International
Inc. (ISI) (A Nevada Corporation) 29,702,637 - - -
Additional shares issued subsequent
to merger SeaCrest Industries
Corporation (A Nevada
Corporation) 4,000,000 - - -
--------- ----------- ----------- ----------
Balance September 30, 1997 56,446,501 $7,720 $ - $7,720
========== ====== =========== ======
</TABLE>
The accompanying notes are an integral part of these financial statements
[7]
<PAGE>
SEACREST INDUSTRIES CORPORATION
STATEMENT OF CASH FLOWS
For the period January 1, 1996 to December 31, 1996
<TABLE>
<CAPTION>
Infrared Seacrest
Systems Industries Combined
International (Delaware) Proforma
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C> <C>
Net income for the period $ 4,450 $ - $ 4,450
------- ------------- -------
Net Cash provided by operating activities 4,450 $ - $ 4,450
------- ------------- -------
CASH FLOWS USED IN INVESTING ACTIVITIES
Patent licensing agreement 5,000 - 5,000
------- ----------- -------
Net Cash used by investing activities (5,000) - (5,000)
-------- ----------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Advanced Royalties 5,000 - 5,000
------- ----------- -------
Net Cash used by Financing activities 5,000 - 5,000
------- ----------- -------
Cash at beginning of period 983 - 983
------- ----------- -------
Cash at end of period $5,433 - $5,433
====== =========== ======
</TABLE>
The accompanying notes are an integral part of these financial statements
[8]
<PAGE>
SEACREST INDUSTRIES CORPORATION
STATEMENT OF CASH FLOWS
For the period January 1, 1997 to September 30, 1997
<TABLE>
<CAPTION>
Infrared Seacrest
Systems Industries Combined
International (Delaware) Proforma
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C> <C>
Net income for the period $ (15,152) $ - $ (15,152)
10,000 - 10,000
--------- ------------ --------
Net Cash provided by operating activities (5,152) - (5,152)
--------- ------------- ---------
CASH FLOWS USED IN INVESTING ACTIVITIES
Patent licensing agreement 20,000 - 20,000
------- ----------- -------
Net Cash used by investing activities 20,000 - 20,000
------ ----------- -------
CASH FLOWS (USED) FINANCING ACTIVITIES
Advanced Royalties (20,000) - (20,000)
-------- ----------- --------
Net Cash used by Financing activities (20,000) - (20,000)
-------- ----------- --------
Cash at beginning of period 5,433 - 5,433
------- ----------- -------
Cash at end of period $ 281 - $ 281
======= =========== =======
</TABLE>
The accompanying notes are an integral part of these financial statements
[9]
<PAGE>
SEACREST INDUSTRIES CORPORATION
NOTES TO FINANCIAL STATEMENTS
ORGANIZATION AND DESCRIPTION OF BUSINESS
SeaCrest Industries Corporation, (A Nevada Corporation) was Incorporated on June
2, 1997 under the laws of the state of Nevada. The Company was capitalized by a
merger agreement dated May 12, 1997 between SeaCrest Industries Corporation, (A
Delaware Corporation) and Infrared Systems International, Inc., (A Nevada
Corporation). The stockholders of SeaCrest Industries Corporation, (A Delaware
Corporation) traded their stock 2 shares for 1 share of the newly formed
corporation. The stockholders of Infrared Systems International, Inc., (A Nevada
Corporation) traded their stock 1 for 2.8 shares of the newly formed
corporation. Infrared Systems International has been operating under a
consulting agreement with Kollsman. The business purpose of the company is to
full utilized its licensing agreement for infrared enhanced vision sensor
systems under U.S. Patent No 5,534,694 held by Hughes Aircraft Company. The
preparation of financial statements, in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1.
Cash and cash equivalents The company considers all cash on hand and in banks,
including accounts in book overdraft positions, certificates of deposit and
other highly-liquid investments with maturities of three months or less, when
purchased, to be cash and cash equivalents. 2. Income per share Income per share
is computed by dividing the net income by the weighted average number of shares
of common stock and common stock equivalents, if any, outstanding during the
year/period. Note 1 - PREPAID LICENSE AGREEMENT Infrared Systems International,
Inc. Has entered into a licensing agreement (D-71-091094.5) for Infrared
Aircraft Landing System with Hughes Aircraft Company, dated October 1995.
Infrared Systems International, Inc. paid $25,000 for this agreement. Hughes
Aircraft Company is to receive $1000 per unit additional royalty as units are
sold. $20,000 of this prepayment will be applied to royalty as units are sold.
This prepayment grants Infrared Systems International, Inc. exclusive right to
licensing.
The accompanying notes are an integral part of these financial statements
[10]
<PAGE>
SEACREST INDUSTRIES CORPORATION
NOTES TO FINANCIAL STATEMENTS
(continued)
Note 2 - NOTE PAYABLE
The Company is indebted to Equishare Financial Inc., a wholly owned
corporation of Mr. C.M. Ball. This note is payable upon demand and accrues
interest at the rate of 5%.
Note 3 - LICENSING ROYALTY AGREEMENT
Infrared Systems International, Inc. has entered into a licensing royalty
agreement with Kollsman, Inc. for marketing and distribution of Infrared
Aircraft Landing Systems. This agreement has been assigned to SeaCrest
Industries Corporation as part of the merger agreement. This agreement entitles
SeaCrest to an advanced royalty of $5,000 per month plus time and expenses and
an initial $20,000 advance. Management discussions with Kollsman have estimated
that this agreement will generate approximately $33,000,000 in royalties over
the duration of the agreement.
Note 4 - SIGNIFICANT STOCKHOLDER
Gary and Wendy Ball are greater than 10% shareholders of SeaCrest Industries
Corporation, (A Nevada Corporation) holding 18,480,000 shares.
The accompanying notes are an integral part of these financial statements
[11]
<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.
SeaCrest Industries Corporation
By: /s/ Gary E. Ball
Gary E. Ball
Dated: October 31, 1997
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.
/s/ Gary E. Ball October 31, 1997 President and Director
Gary E. Ball
/s/ Wendy S. Ball October 31, 1997 Director
Wendy S. Ball
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANT
I hereby consent to the incorporation of my report dated October 21,
1997, which is incorporated in this Annual Report on Form 10-KSB
John P. Semmens CPA
A Professional Corporation
November 18, 1997
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> Sep-30-1997
<PERIOD-START> Jan-01-1997
<PERIOD-END> Sep-30-1997
<CASH> 281
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 42720
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 60152
<CURRENT-LIABILITIES> 52432
<BONDS> 0
0
0
<COMMON> 7720
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 60152
<SALES> 77184
<TOTAL-REVENUES> 77184
<CGS> 0
<TOTAL-COSTS> 92339
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (15152)
<INCOME-TAX> 0
<INCOME-CONTINUING> (15152)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (15152)
<EPS-PRIMARY> (0.00)
<EPS-DILUTED> (0.00)
</TABLE>
