8
_________________________________________________________________
__
U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________
FORM 10-QSB
Mark One:
[X] Quarterly Report Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For the Quarterly Period Ended June 30, 1997
OR
[ ] Transition Report Pursuant to Section 13 or
15(d)
of the Securities Exchange Act of 1934
Commission file number 1-11968
SAF T LOK INCORPORATED
(Exact name of small business issuer
as specified in its charter)
FLORIDA
65-0142837
(State or other jurisdiction (I.R.S.
Employer Identification
of incorporation or organization) 0No.)
18245 S. E. Federal Hwy.
Tequesta, FL 33469
(Address of principal executive offices)
Telephone No. (561) 743-5625
_______________________
(Former name, former address and former fiscal year, if
changed since last report.)
_________________________
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 X No __
As of June 30, 1997 there were 6,194,235 shares of the issuer's
common stock outstanding.
Transitional Small Business Disclosure Format: Yes __ No X
________________________________________________________________
<PAGE>
Part I. Financial Information
Item 1. Financial Statement.
The required financial statements are attached hereto.
Item 2. Management's Discussion and Analysis or Plan of
Operation.
Sales have continued to be very modest, with disappointing
results in the second quarter.
As outlined in past reports, the marketing program was to first
"fill the
pipeline", having merchandise on dealers' shelves ready for sale.
Since all
new gun purchases must be from a federally licensed gun dealer it
was expected
the dealer would have a ready made customer base to which he would
merchandise
Saf T Lok( along with other handgun accessories. From these sales the
company
expected to generate sufficient revenue to begin the very expensive
advertising
campaign to the general public, bringing in sales from the much larger
retrofit market segment. Thus, increasing revenues would provide
increased
advertising dollars, snowballing both sales and profits. The success
or
failure of this plan depended on the dealers' ability or willingness
to
merchandise Saf T Lok product.
Though in its infancy, the plan was working well until the
federal intervention
in the form of proposed legislation for mandatory "child safety
locks". This
legislation has been strongly opposed by the National Rifle
Association around
which have rallied a large percentage of gun dealers on whom Saf
T Lok is
dependent for sales. It is felt that in time this behavior from
the dealers
will wane, especially if customers come to their stores
determined to purchase
a lock.
The company has engaged a professional marketing firm, West
Marketing
Industries, to aid in increasing the awareness of Saf T Lok with
the general
public. While this program has just begun, ads have already been
run in a
regional issue of U. S. Today and another large newspaper. It is
too early to
determine the effects of the advertising. Other promotional
efforts are
underway.
The attention and enthusiasm in the law enforcement community for
the
magazine lock indicates a bright future for this lock. Sales of
the magazine
lock, due out late this year, are expected to act as a catalyst
to
substantially increase sales of the grip lock to the general
public.
There is continuing growth in "child safety lock" legislation and
regulations
at the state, county and municipal levels. This is not only
serving to increase
public awareness for this important issue but is also bringing it
acutely to
the forefront with law enforcement agencies as they seek more
effective ways to
provide handgun security for their officers. Since the original
grip lock could
not be practically adapted to most guns in use by law
enforcement, the
magazine lock was developed. Introduced at the SHOT show this
January and,
following a mailing to all Sheriff's departments, the lock was
exhibited at the
National Sheriff's Association show in June. The lock was met
with considerable
enthusiasm as it has also been in other private demonstrations
with law
enforcement agencies.
The Company is continuing to take steps to reduce debt and keep
expenses and
cash flow in line while maintaining essential operating, sales
and product
development efforts to insure the future growth of the Company.
Since
November 1996 all management salaries have been waived or very
substantially
reduced. As a result, approximately $120,000 in accrued wages
have been
credited back to G & A expenses for this year.
Trade show expenses of $33,000 for the quarter were directed
mainly at the law
enforcement market. They continue to be the major direct selling
expense and
are paying good dividends by generating considerable interest in
the magazine
lock.
Fees and commissions in excess of $60,000 related to the raising
of capital
constitute the largest portion of G & A expenses. This expense
will disappear
once the Company reaches it's funding goal.
As a result of additional funds obtained this quarter the
Company's cash
position is up $148,242 to $237,198, while payables and accrued
expenses
have been reduced to $527,737 (part of which relates to the
waiver of accrued
salaries). Total shareholder's equity has improved by $381,292
to $1,513,634.
The company continues to raise additional capital for both the
magazine lock
project and further marketing efforts to boost sales of the grip
lock. The
issuance of up to $2,000,000 in 8% Convertible Debentures has
been
authorized and in July $550,000 worth had been sold.
With the company's funds being limited the first order of
business is to
complete the magazine lock, bring it to volume production before
the end of
this year, and intensify the sales efforts to the law enforcement
market.
Marketing efforts to the law enforcement community are
considerably less costly
than to the general public and are expected to yield significant
sales and
favorable publicity.
<PAGE>
Part II. Other Information
Item 1. Legal proceedings
In December 1996 Lisa Broderick Fogel and her husband Bruce Fogel
sued the
Company and Franklin Brooks for defamation and loss of consortium
arising out
of her brief tenure in November 1996 as president of the Company.
The
complainants have since dropped their claims for monetary
damages. Mr.
Brooks has made an offer to settle the remaining issues and
awaits a reply. The
Company's insurance company, Reliance Insurance Company is
defending the
Company and Mr. Brooks.
In April 1997 the Company settled a lawsuit filed by Engineering
Analyses &
Solutions, Inc. for money damages arising out of an alleged
breach of contract
for engineering services. The settlement included issuance of
options for 4637
shares of common stock at a price of $3.94 per share.
The Company is not a party in any other ongoing or pending legal
proceedings,
nor are any of the Company's properties the subject of
litigation, and the
Company is not aware of any pending or contemplated proceeding
against it by
governmental authorities concerning environmental matters. The
Company
knows of no legal proceedings, pending or threatened, or
judgments entered
against any director or officer of the Company in his capacity as
such.
Item 2. Changes In Securities.
On April 9, 1997, DSE, Inc. d/b/a Dayron, the lock assembly
contractor, was
issued 75,903 restricted common shares at $2.60 per share as
payment for
assembly services and tooling charges for a total of $171,347
plus registration
costs.
On April 18, 1997, the Company issued 25,503 shares of restricted
common
stock to Franklin W. Brooks, chairman of the Company, in exchange
for the
cancellation of a $50,000 loan made to the Company in April 1997
by Mr.
Brooks.
On May 1 , 1997 the Company issued 30,000 shares of restricted
common stock
to Richard M. and Jean Taylor as part of a release and severance
agreement.
Item 3. Defaults upon Senior Securities.
None.
Item 4. Submission Of Matters To A Vote Of Security Holders.
During the second quarter of 1997, no matters were submitted to a
vote of
security holders through the solicitation of proxies or
otherwise.
Item 5. Other Information
On April 25, 1997 the registrant issued and sold a total of
115,385 restricted
shares of its common stock to a single offshore investor pursuant
to
Regulation S. The offering was not underwritten; a financial
consultant to the
registrant introduced the registrant to the investor. The
aggregate sum paid I
n cash for the shares was $150,000, or $1.30 per share. No
discounts or
commissions were paid in connection with the sale.
On May 8, 1997 the registrant issued and sold a total of 163,846
restricted
shares of its common stock to two offshore investors pursuant to
Regulation S.
The offering was not underwritten; a financial consultant to the
registrant
introduced the registrant to the investor. The aggregate sum
paid in cash for
the shares was $200,000, or $1.22 per share. No discounts or
commissions
were paid in connection with the sale.
On June 11, 1997 the registrant issued and sold a total of
153,846 restricted
shares of its common stock to a single offshore investor pursuant
to Regulation
S. The offering was not underwritten; a financial consultant to
the registrant
introduced the registrant to the investor. The aggregate sum
paid in cash for
the shares was $200,000, or $1.30 per share. No discounts or
commissions
were paid in connection with the sale.
On July 15, 1997, the Company completed a sale of convertible
debentures in
the principal amount of $550,000 pursuant to Regulation S. The
convertible
debentures have a term of 5 years with 8% interest per year with
the interest
payable in shares of the Company's common stock. The holders of
the
convertible debentures have the right to convert the principle
amount and
accrued interest on the debentures at any time from the 41st day
after the
issuance of the debenture at the conversion price equal to 70% of
the average
closing bid price of the Company's stock during the last five
trading days
prior to the effective date of the conversion. In connection
with the
placement of this sale a cash commission, a non-accountable
expense
allowance, and a stock purchase warrant were paid or issued to an
investment
banking firm.
On May 30, 1997 the Company engaged Goldberg, Pershes and Company
to be
their Certified Public Accountants. This was a change from
Weinberg, Pershes
and Company as a result of the Company's primary contact, Paul
Pershes
withdrawing from Weinberg, Pershes and Company and forming a new
company, Goldberg, Pershes and Company.
On June 27, 1997 the Company received notice from Nasdaq that
it's stock
would be delisted because total assets had fallen below $2
million and it's
stockholder equity had fallen below $1 million as reported by the
company for
March 31, 1997. The Company advised Nasdaq that it had raised
additional
equity capital and that, as of May 31, 1997, it met both the
asset and
stockholder's equity test. Nevertheless, Nasdaq advised the
Company that the
Company's stock would be delisted. The Company appealed the
decision and a
stay of delisting was granted with a hearing date set for August
14, 1997. The
company believes that it will be able to show Nasdaq that it will
be able to
meet the continuing listing requirements in the future and will
not be delisted.
Item 6. Exhibits and Reports on Form 8-K.
(a) Reports on Form 8-K
1. Form 8K filed April 18, 1997, reporting on John Gardner's
employment.
2. Form 8K filed April 30, 1997, reporting the sale of common
stock.
3. Form 8K filed June 11, 1997, reporting the sale of common
stock.
4. Form 8K filed June 11, 1997, reporting change in accountant.
5. Form 8K/A filed June 18, 1997, amending report of change in
accountant.
6. Form 8K/A filed June 11, 1997, amending report of change in
accountant.
7. Form 8K filed June 12, 1997, reporting the sale of common
stock.
8. Form 8K filed June 27, 1997 reporting the delisting
notification from Nasdaq.
9. Form 8K filed July 23, 1997 reporting the sale of convertible
debentures.
<PAGE>
SIGNATURES
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.
SAF T LOK INCORPORATED
By: //Franklin W. Brooks
(Chairman of the Board)
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 date indicated.
Signature Date
//Franklin W. Brooks// Chairman of the Board
July 25, 1997
Franklin W. Brooks
//John L. Gardner// Chief Executive Officer
John L. Gardner President and Director
July 25, 1997
//Jeffrey W. Brooks// Secretary and Director
July 25, 1997
Jeffrey W. Brooks
//William M. Schmidt// Director
July 25, 1997
William M. Schmidt
//Robert L. Gilbert// Director
July 25, 1997
Robert L. Gilbert
//Eugene V. Horanoff// Director
July 25, 1997
Eugene V. Horanoff
<PAGE>
=================================================================
===============
Financial Statements
=================================================================
===============
SAF T LOK, INCORPORATED
F/K/A RGB COMPUTER & VIDEO, INC.
REPORT
AS OF JUNE 30, 1997
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
CONTENTS
PAGE 1 - 2 CONSOLIDATED BALANCE SHEETS AS OF JUNE 30,
1997 AND DECEMBER 31, 1996
PAGE 3 CONSOLIDATED STATEMENTS OF CHANGES IN
SHAREHOLDERS' EQUITY FOR THE SIX MONTHS
ENDED
JUNE 30, 1997 AND THE YEAR ENDED DECEMBER
31,
1996
PAGE 4 CONSOLIDATED STATEMENTS OF OPERATIONS FOR
THE
THREE MONTHS AND SIX MONTHS ENDED JUNE 30,
1997 AND
1996
PAGE 5 - 6 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR
THE
SIX MONTHS ENDED JUNE 30, 1997 AND 1996
PAGE 7 - 11 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 1997 (UNAUDITED) AND DECEMBER 31,
1996
ASSETS
JUNE 30, DECEMBER
31,
1997
1996
CURRENT ASSETS
Cash and cash equivalents $ 237,198 $
88,956
Accounts receivable (net of allowance
for doubtful accounts of $21,229 and
$23,000, respectively) 4,841
10,419
Inventories 468,748
466,680
Prepaid expenses 37,086
21,111
Total Current Assets 747,873
587,166
PROPERTY AND EQUIPMENT, NET OF
ACCUMULATED DEPRECIATION 861,591
932,028
OTHER ASSETS
Patents, (net of accumulated
amortization of $45,000 and
$28,000 respectively) 355,147
374,147
Loans receivable 189,279
199,842
Other assets 1,695
975
Total Other Assets 546,121
574,964
TOTAL ASSETS $ 2,155,585 $
2,094,158
Read notes to consolidated financial
statements.
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 1997 (UNAUDITED) AND DECEMBER 31,
1996
LIABILITIES AND SHAREHOLDERS' EQUITY
JUNE 30, DECEMBER
31,
1997
1996
CURRENT LIABILITIES
Notes payable - current portion $ 76,217 $
67,353
Accounts payable and accrued
expenses 527,737
836,402
Total Current Liabilities 603,954
903,755
LONG TERM LIABILITIES
Notes payable, net of current portion 37,996
58,061
TOTAL LIABILITIES 641,950
961,816
SHAREHOLDERS' EQUITY
Common Stock, $.01 par
value, 20,000,000 shares
authorized, 5,727,598 and
5,651,089 shares issued
and outstanding, respectively. 61,942 56,511
Capital in excess of par 9,976,948
9,167,898
Deficit (8,525,256)
(8,092,067)
TOTAL SHAREHOLDERS' EQUITY 1,513,634
1,132,342
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $2,155,585
$2,094,158
Read notes to consolidated financial
statements.
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS'
EQUITY
FOR THE SIX MONTHS ENDED JUNE 30, 1997
(UNAUDITED)
AND THE YEAR ENDED DECEMBER 31, 1996
Capital
Common Stock In Excess
Shares Amount of Par Deficit
Total
Balance-
January 1,
1996 3,263,100 $ 32,631 $8,056,639 $(4,816,725)
$3,272,545
Issuance of
common stock
for Saf T Lok
merger 2,238,957 22,390 504,149 -
526,539
Issuance of
stock for
settlement of
lawsuit 20,000 200 8,400 -
8,600
Capital
Contribution - - 200,000 -
200,000
Issuance of
common stock 129,032 1,290 398,710 -
400,000
Net loss - - - (3,275,342)
(3,275,342)
Balance -
December 31,
1996 5,651,089 56,511 9,167,898 (8,092,067)
1,132,342
Issuance of
common stock 543,146 5,431 809,050 -
814,481
Net Loss - - - (433,189)
(433,189)
BALANCE -
JUNE 30,
1997 6,194,235 $ 61,942 $9,976,948 $(8,525,256)
$1,513,634
Read notes to consolidated financial
statements.
<PAGE>
SAF T LOK INCORPORATED AND
SUBSIDIARIES
F/K/A RGB COMPUTER &
VIDEO, INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
THREE MONTHS PERIOD
SIX MONTHS PERIOD
ENDED JUNE
30, ENDED JUNE 30,
1997
1996 1997 1996
Revenue $ 6,106
- - $ 33,521 -
Cost of Sales 4,204
- - 19,205 -
Gross Profit 1,902
- - 14,316 -
Selling, General and Administrative
Expenses 146,138
491,091 360,832 827,211
Depreciation and Amortization 41,550 6,090
86,673 19,965
Loss from continuing operations ( 187,390) ( 517,146)
( 433,189) ( 867,141)
Loss from discontinued operations -
155,985 - 337,372
Net loss ( 187,390)
( 673,131) ( 433,189) (1,204,513)
Loss per common share
Loss from continuing operations (.03)
(.09) (.07) (.17)
Loss from discontinued operations -
(.03) - (.07)
Net loss
(.03) (.12) (.07) (.24)
Weighted average number of
common shares outstanding 6,194,235 5,740,388
6,194,235 5,177,516
Read notes to consolidated financial
statements.
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
AND 1996
1997
1996
Cash flows from operating activities:
Loss from continuing operations $ (433,189) $
(867,141)
Loss from discontinued operations -
(337,372)
Adjustments to reconcile net (loss)
to net cash (used in) operating
activities:
Depreciation and amortization 86,673
90,130
Bad debt expense 2,500
146
Loss on sale and disposal of
fixed assets -
1412
Exchange of fixed asset in payment
of consulting fees 22,734 -
Change in assets and liabilities:
(Increase)decrease in:
Accounts receivable 5,578
(5,789)
Inventories (2,068)
(183,457)
Prepaid and other current assets (15,975)
(36,296)
Increase (decrease)in:
Accounts payable and accrued
expenses (77,860)
(44,933)
NET CASH (USED IN)
OPERATING ACTIVITIES (411,607)
(1,383,300)
Cash flows from investing activities:
Purchase of property and equipment -
(653,941)
Proceeds from sale of fixed assets -
15,550
Proceeds from Investments
518,362
Proceeds from loans receivable 10,563
18,100
(Increase) decrease in loans
receivable-officers -
(22,916)
(Increase) decrease in other assets 720
(699)
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES 11,283
(125,544)
Read notes to consolidated financial
statements.
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 (UNAUDITED)
AND 1996
1997
1996
Cash flows from financing activities:
Principal payments on borrowings,
including capital lease obligations (1,436)
(7,589)
Increase in Loan Payable-Shareholder -
120,000
Proceeds from sale of common stock 550,000
- -
Equity changes due to acquisition -
421,713
Proceeds from notes payable
(9,410)
NET CASH PROVIDED BY (USED IN)
FINANCING ACTIVITIES 548,564
524,714
NET INCREASE (DECREASE) IN CASH 148,240
(984,130)
CASH AND CASH EQUIVALENTS, AT
BEGINNING OF YEAR 88,956
1,981,217
CASH AND CASH EQUIVALENTS, AT
END OF PERIOD $ 237,198 $
997,087
SUPPLEMENTAL DISCLOSURES OF CASH
FLOW INFORMATION:
Cash payments for:
Interest $ 212 $
- -
NON-CASH INVESTING AND FINANCING ACTIVITIES:
In February 1996, the Company merged with Saf T Lok,
Incorporated by
issuing 2,238,957 shares of the Company's common stock in
exchange for
100% of the outstanding stock of Saf T Lok
Corporation. The
transaction was recorded under the purchase method and
the common
stock was valued at $527,000.
Read notes to consolidated financial
statements.
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1
The unaudited financial information furnished herein
reflects all adjustments
which in the opinion of management are necessary to fairly
state the
Company's financial position, the changes in its financial
position and the
results of its operations for the periods presented. This
report on Form
10-QSB should be read in conjunction with the Company's
financial statements
and notes thereto included on Form 10-KSB for the year ended
December 31,
1996. The Company presumes that users of the interim
financial information
herein have read or have access to the audited financial
statements for the
preceding fiscal year and that the adequacy of additional
disclosure needed
for a fair presentation may be determined in that context.
Accordingly, footnote
disclosure which would substantially duplicate the
disclosure contained in the
Company's financial statements for the year ended December
31, 1996 has
been omitted. The results of operations for the six month
period ended June
30, 1997 are not necessarily indicative of results for the
entire year ending
December 31, 1997.
NOTE 2 - INVENTORIES
Inventories are comprised of the following as of June 30,
1997 and
December 31, 1996:
1997 1996
Raw Materials and
Furnished goods $468,748 $466,680
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3 - PROPERTY AND EQUIPMENT
Property and equipment is comprised of the following as of
June, 30
1997 and December 31, 1996:
1997 1996
Equipment
$ 373,344 $ 373,344
Furniture and fixtures
52,997 52,997
Automobile
- - 34,000
Tools and dies
792,295 762,560
Software
37,214 37,214
Leasehold improvements
11,436 11,436
1,267,287 1,271,551
Less accumulated
depreciation
405,696 339,523
$ 861,591 $ 932,028
NOTE 4 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES
Accounts payable and accrued expenses are comprised
of the
following as of June 30, 1997 and December 31, 1996:
1997 1996
Accounts payable $527,737 $714,215
Accrued payroll and
payroll taxes 122,187
$527,737 $836,402
The officers have forgiven all accrued salaries.
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5 - NOTES PAYABLE
June 30, December
31,
1997 1996
Note Payable - Bank
collateralized by
an automobile, payable
in monthly installments
of $549 including interest
at 8% due October 25, 1998.
This note was assumed by
one of the former Chief
Executive Officers. $ - $ 11,201
Note Payable - shareholder,
collateralized by patents,
payable in monthly
installments of $3,738
including interest at 7%, due
March 1999 114,213 114,213
Total Long-Term Debt 114,213 125,414
Current Portion 76,217 67,353
Total Long-Term Debt, net
of Current Portion $ 37,996 $ 58,061
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 6 - SHAREHOLDERS' EQUITY
On April 9, 1997, DSE, Inc. d/b/a Dayron, the lock assembly
contractor,
was issued 75,903 restricted shares of common stock at $2.60
per
share as payment for assembly services and tooling charges
as well
as registration costs.
On April 18, 1997, the Company issued 25,503 restricted
shares of
common stock to Franklin W. Brooks, Chairman of the Company,
in
payment of a $50,000 loan made to the Company by Mr. Brooks.
On May 1, 1997, the Company issued 30,000 restricted shares
of
common stock to Richard M. and Jean Taylor as part of a
release and
severance agreement.
In April 1997, the Company sold, under a regulation S
subscription
agreement, 115,385 restricted shares of the Company's common
stock
to a single offshore investor for $150,000.
In May 1997, the Company sold, under a regulation S
subscription
agreement, 163,846 restricted shares of the Company's common
stock
to a single offshore investor for $200,000.
In June, 1997, the Company sold, under a regulation S
subscription
agreement, 153,846 restricted shares of the Company's common
stock
to a single offshore investor for $200,000.
<PAGE>
SAF T LOK INCORPORATED AND SUBSIDIARIES
F/K/A RGB COMPUTER & VIDEO, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 7 - SUBSEQUENT EVENTS
On July 15, 1997, the Company completed a sale of
convertible
debentures in the in principle amount of $550,000 to foreign
purchasers pursuant to Regulation S.
