<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 29, 1996
Commission File No. 0-23204
VISTA 2000, INC.
(Exact name of registrant as specified in its charter)
Delaware 58-1972066
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
736 Johnson Ferry Road
Marietta, Georgia 30068
(Address of principal executive offices)
(770) 971-4344
(Registrant's telephone number)
Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for at least
the past 90 days. Yes |_| No |X|
State the number of shares outstanding of each of the registrant's classes of
common equity, as of the latest practicable date.
Class Outstanding at June 29, 1996
- ----- ----------------------------
Common Stock, $.01 par value 18,074,970
<PAGE>
PART I.- FINANCIAL INFORMATION
Item 1. Financial Statements
2
<PAGE>
Vista 2000, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
<TABLE>
<CAPTION>
ASSETS
June 29, 1996 December 30,
(Unaudited) 1995
-------------------------
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 1,230 $ 871
Accounts receivable, net of allowance for doubtful
accounts and returns of $1,866 and $2,230, respectively 14,277 15,910
Inventories 39,661 33,378
Prepaid expenses 1,888 217
Other current assets 79 1,174
-------------------------
Total current assets 57,135 51,550
-------------------------
Property and Equipment, at cost 17,336 13,721
Less: accumulated depreciation 1,843 680
-------------------------
Net property and equipment 15,493 13,041
-------------------------
Other Assets 3,419 720
-------------------------
$ 76,047 $ 65,311
=========================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Current portion of long-term debt $ 516 $ 607
Accounts payable 10,034 12,542
Accrued payroll and related expenses 2,768 4,053
Accrued liabilities 3,181 3,955
-------------------------
Total current liabilities 16,499 21,157
-------------------------
Long-term debt, net of current portion 21,855 23,029
Commitments and Contingencies
Stockholders' Equity
Preferred stock $1 par value, 500,000 shares authorized,
4,220 and 18,418 shares issued and outstanding, respectively 3,984 5,981
Common stock, $.01 par value, authorized 50,000,000 shares,
issued and outstanding, 18,074,970 and 11,626,475, respectively 181 116
Additional paid-in capital 61,972 36,201
Accumulated deficit (27,608) (20,939)
Currency translation (20) (19)
-------------------------
38,509 21,340
Less: treasury shares and warrants - at cost 816 215
-------------------------
Total Stockholders' equity 37,693 21,125
-------------------------
$ 76,047 $ 65,311
=========================
</TABLE>
The accompanying notes are an integral part of these statements
3
<PAGE>
VISTA 2000, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands except per share data)
<TABLE>
<CAPTION>
Six months Six months
Quarter ended Quarter ended June ended June 29, ended June 30,
June 29, 1996 30, 1995 (as 1996 1995 (as
(Unaudited) restated) (Unaudited) restated)
-------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Sales $ 27,169 $ -- $ 55,283 $ 27
Cost of Sales 20,363 41,817 312
-------------------------------------------------------------------------
Gross profit (loss) 6,806 -- 13,466 (285)
Operating expenses 8,608 1,368 19,788 2,400
-------------------------------------------------------------------------
Operating loss (1,802) (1,368) (6,322) (2,685)
Other income and (expense)
Interest expense (464) (4) (983) (31)
Other income (expense), net 73 151
Gain (loss) on sale of assets 485 485
-------------------------------------------------------------------------
Net loss $ (1,708) $ (1,372) $ (6,669) $ (2,716)
=========================================================================
Weighted average shares outstanding 16,772,927 4,931,069 14,826,933 4,269,602
Loss per common share:
Net loss $ (0.10) $ (0.28) $ (0.45) $ (0.64)
=========================================================================
</TABLE>
The accompanying notes are an integral part of these statements
4
<PAGE>
Vista 2000, Inc. and Subsidiaries
Consolidated Statement of Stockholders' Equity (Deficit)
Quarter ended June 29, 1996
(Dollars and share amounts in thousands)
<TABLE>
<CAPTION>
Preferred Stock
--------------------------------------------------------
Series A Series C Series D
-------- -------- -------- Common Stock
Shares Dollars Shares Dollars Shares Dollars Shares Dollars
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at March 30, 1996 2 $ 245 -- $1,189 12 $11,300 14,299 $ 143
Coversions of preferred stock to common stock (1) (123) (91) (9) (8,536) 3,776 38
Acquisition of treasury stock
Exercise of stock options
Exercise of warrants
Compensatory stock options
Foreign currency translation adjustment
Net (Loss)
--------------------------------------------------------------------------------
Balance at June 29, 1996 1 $ 122 -- $1,098 3 $ 2,764 18,075 $ 181
================================================================================
<CAPTION>
Treasury Stock Additional Cummulative Total
and Warrants Paid-in Accumulated Translation Stockholders'
Shares Dollars Capital (Deficit) Adjustment Equity(Deficit)
-----------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance at March 30, 1996 (116) $(770) $ 53,225 $(25,900) $ (16) $39,416
Coversions of preferred stock to common stock 8,712 --
Acquisition of treasury stock (5) (46) (46)
Exercise of stock options --
Exercise of warrants --
Compensatory stock options 35 35
Foreign currency translation adjustment (4) (4)
Net (Loss) (1,708) (1,708)
-----------------------------------------------------------------------
Balance at June 29, 1996 (121) $(816) $ 61,972 $(27,608) $ (20) $37,693
=======================================================================
</TABLE>
The accompanying notes are an integral part of these statements
5
<PAGE>
VISTA 2000, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
<TABLE>
<CAPTION>
Six months Six months
Quarter ended Quarter ended June ended June 29, ended June 30,
June 29, 1996 30, 1995 (as 1996 1995 (as
(Unaudited) restated) (Unaudited) restated)
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash flows used by operating activities:
Net loss $(1,708) $(1,372) $ (6,669) $(2,716)
Adjustments to reconcile net loss to net cash used
by operations:
Depreciation 660 20 1,163 30
(Gain) Loss on disposal of property and equipment (485) -- (485) --
Stock based compensation expense 35 82 1,601 582
(Increase) decrease in operating assets:
Accounts receivable (7) 36 1,633 35
Inventories (838) (287) (6,733) (165)
Prepaid expenses and other current assets (249) (52) (576) (58)
Deferred charges and other assets 531 (13) 146 (222)
Other Assets -- -- --
Increase (decrease) in operating liabilities:
Accounts Payable (436) 382 (2,508) 208
Accrued liabilities (359) (39) (2,065) (75)
---------------------------------------------------------------
Net cash used by operating activities (2,856) (1,243) (14,493) (2,381)
---------------------------------------------------------------
Cash flows used by investing activities:
Acquisition of Intelock Technologies, Inc.
net of cash acquireed -- 754 0 754
Purchases of property and equipment (1,243) (82) (3,615) (166)
Deposit on real property under contract for purchase -- -- (2,845)
---------------------------------------------------------------
Net cash used by investing activities (1,243) 672 (6,460) 588
---------------------------------------------------------------
Cash flows provided by financing activities:
Net proceeds (payments) from short-term borrowings (96) (800) (96)
Net proceeds (payments) from long-term debt (347) -- (459) 110
Net proceeds from sale of property and equipment 935 935
Proceeds from issuance of common stock, net of issue costs -- 1,627 1,800 2,452
Proceeds from issuance of preferred stock, net of issue costs -- -- 19,400 --
Proceeds from exercise of stock options and warrants -- -- 1,038 --
Purchase of treasury stock (46) (56) (601) (141)
---------------------------------------------------------------
Net cash provided by financing activities 542 1,475 21,313 2,325
---------------------------------------------------------------
Effect of exchange rates on cash and cash equivalents (4) -- (1) --
---------------------------------------------------------------
Net increase (decrease) in cash during period (3,561) 904 359 532
Cash and cash equivalents at the beginning of the period 4,791 77 871 449
Cash and cash equivalents at the end of the period ---------------------------------------------------------------
$ 1,230 $ -- $ 981 $ 1,230
===============================================================
Supplemental disclosure:
Interest paid $ 464 $ -- $ 983 $ 31
Noncash investing and financing activities:
Conversion of debt to common stock $ -- $ -- $ -- $ 720
Acquisition of business:
Fair value of assets acquired $ -- $ 1,950 $ -- $ 1,950
Cash paid (21) (21)
Common stock issued (1,097) (1,097)
===============================================================
Liabilities assumed $ -- $ 832 $ -- $ 832
===============================================================
</TABLE>
The accompanying notes are an integral part of these statements
6
<PAGE>
Vista 2000, Inc. And Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 29, 1996
(Dollar amounts in thousands except share and per share data)
(1) Summary of Significant Accounting Policies
Principles of Consolidation
The accompanying consolidated financial statements as of June 29, 1996
and for the quarter then ended include the accounts of Vista 2000, Inc. and its
wholly-owned subsidiaries, ACPI, Alabaster, FSPI and Intelock. The accompanying
consolidated financial statements as of June 30, 1995 and for the quarter then
ended include the accounts of Vista, FSPI and Intelock. Intelock was acquired on
June 30, 1995, therefore the consolidated financial statements for the quarter
ended June 30, 1995 include only balance sheet accounts. PMI was acquired in
May, 1995 and is accounted for as a purchase using the equity method of
accounting, therefore the operating results of PMI are not included in the
consolidated financial statements of Vista. All significant intercompany
balances and transactions have been eliminated in the consolidated financial
statements.
Income Taxes
The Company accounts for income taxes under the asset and liability
method, in accordance with Statement of Financial Accounting Standards Number
109 ("SFAS 109"). Under SFAS 109, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and
their respective tax bases. Deferred tax assets and liabilities are measured
using statutory tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled. Under
SFAS 109, the effect on deferred tax assets and liabilities of a change in tax
rates is recognized in income in the period that includes the enactment date. A
valuation allowance is provided for deferred tax assets when utilization of such
asset is not reasonably assured.
Net Loss Per Common Share
Net loss per common share has been calculated using the weighted
average number of shares of common stock outstanding during each period. Fully
diluted net income per common share is not disclosed because the effect of
common stock equivalents would be antidilutive.
Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from the these estimates.
Stock Based Compensation
The Company's Stock Option Plans are accounted for under APB Opinion
25, Accounting for Stock Issued to Employees, and related interpretations.
7
<PAGE>
Vista 2000, Inc. And Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 29, 1996
(Dollar amounts in thousands except share and per share data)
(1) Summary of Significant Accounting Policies-continued
Unaudited Interim Financial Information
The interim financial information as of and for the three months and
six months ended June 29, 1996 is unaudited and reflects all adjustments
(consisting of normal recurring adjustments) which are, in the opinion of
management, necessary for a fair statement of the results for the interim
periods presented. The results for these interim periods are not necessarily
indicative of the results of a full year.
(2) Prior Period Adjustments and Form 10-QSB Amendments
The audited financial statements previously issued for the year ended
September 30, 1994 have been restated to reflect two prior period accounting
adjustments. First, previously recognized revenue from the sale of an exclusive
license agreement for one of the Company's products, consideration for which was
substantially in the form of a $1,155 note receivable, has been reversed as a
result of a 1996 investigation initiated by the audit committee of the Board of
Directors. Second, $635 of previously reported sales have been reversed also as
a result of the audit committee investigation referred to above. The effects of
these two prior period adjustments on operations results in a reduction of
revenue, an increase in net loss and an increase in accumulated deficit all in
the amount of $1,790.
The comparative quarterly amounts included in this form 10-Q for the
quarter ended June 30, 1995 have been restated to exclude the operating results
of Alabaster, whose date of acquisition had been incorrectly reported in the
previously issued form 10-QSB dated June 30, 1995. Additionally, FSPI sales,
cost of goods sold and net income were overstated by $349, $105 and $244,
respectively, due to the recording of fictitious sales. These restatements
resulted in the following changes in the amounts previously reported in the form
10-QSB issued for the quarter ended June 30, 1995.
As As
restated reported
-------- --------
Current assets $ 2,946 $ 7,727
Property and equipment - net 412 8,522
Other assets 1,102 4,446
Current liabilities 2,319 3,953
Additional paid-in capital 11,061 18,457
Accumulated deficit (8,992) (2,292)
Sales 0 2,807
Cost of goods sold 0 1,512
Operating expenses 1,368 822
Net income (loss) (1,372) 463
Net income (loss) per common share $ (0.28) $ 0.14
8
<PAGE>
Vista 2000, Inc. And Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 29, 1996
(Dollar amounts in thousands except share and per share data)
(3) Inventories
Inventories consist of the following at June 29, 1996:
Raw materials $14,855
Work-in-process 3,592
Finished goods 24,537
Reserve for obsolescence (3,323)
-------
$39,661
=======
(4) Stockholder's Equity (Deficit)
The company issued, during 1995, warrants to various consultants to
acquire up to 645,529 common shares at prices per share ranging from $2.00 to
$12.00. As of June 29, 1996, there were 375,529 of these warrants issued and
outstanding.
Upon completion of the Company's initial public offering, the company
agreed to sell to the underwriters warrants to acquire up to 100,000 shares of
common stock at an exercise price per share of $9.08. Each common share carried
two (2) warrants for the purchase of up to 200,000 shares of the Company's
common stock at $11.55 per share.
During the Company's initial public offering, which occurred in
October, 1994, warrants were issued for the purchase of 2,300,000 shares of the
Company's common stock. For the first two years after issuance the exercise
price per share was $7.00. During the following two year period ending October
26, 1998, the exercise price increases to $10.00 per share. As of June 29, 1996,
all of these warrants were issued and outstanding.
In March 1994, the Company issued 235,598 of its 1994 Convertible
Debenture Warrants to all the former debenture holders that acquired common
stock of the Company on September 30, 1993 pursuant to their right of
conversion. The 1994 Warrants provide for the purchase of one share of common
stock at an exercise price of $2.50 per share and may be exercised for a three
year period commencing 24 months from the date of issuance, which was March
1994. As of June 29, 1996, all of these warrants were issued and outstanding.
On March 11, 1994, the Board of Directors authorized a one-for-two
reverse common stock split. On November 30, 1993, the Board of Directors
authorized a two-for-three reverse common stock split. All references to number
of shares and to stock warrants as well as per share information have been
adjusted to reflect the stock splits on a retroactive basis.
Warrants for the purchase of 26,085 shares of Company common stock that
were issued during 1993 in conjunction with debentures sold by the Company were
issued and outstanding at June 29, 1996. The warrants, which carry an exercise
price of $9.00 each, may be exercised in whole or in part at any time during the
two year period ending January 1997.
9
<PAGE>
Vista 2000, Inc. And Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 29, 1996
(Dollar amounts in thousands except share and per share data)
(4) Stockholder's Equity (Deficit)-continued
The Company has adopted stock option plans providing for the issuance
of options covering up to 1,450,000 shares of common stock to be issued to
officers, directors, or consultants to the Company. Various vesting conditions
apply to these options, based on either tenure or certain performance criteria.
For options granted at strike prices less than the fair market value of the
underlying shares on the date of the grant, the difference in value is
recognized as compensation expense over the applicable vesting periods. This
resulted in charges to operating expense amounting to $35 for the quarter ended
June 29, 1996.
During 1995, the board approved the adoption of an Employee Stock
Purchase plan and authorized the Company to reserve 2,000,000 shares for this
plan.
Stock Options
Stock option transactions during the quarter ended June 29, 1996 are
summarized as follows:
Outstanding at March 30, 1996 1,143,401
Granted 85,000
Exercised (0)
Canceled (629,451)
---------
Outstanding at June 29, 1996 598,950
=========
Series Convertible Preferred Stock
The Company has designated 142,000 of its 500,000 authorized preferred
shares as follows:
Shares Authorized Liquidation preference per share
----------------- --------------------------------
Series A 100,000 $100
Series B 20,000 $1,000
Series C 2,000 $10,000
Series D 20,000 $1,000
The remaining 358,000 authorized preferred shares have not been
designated as a series. The preferred stock is recorded net of issuance costs.
The preferred stock is convertible into Company common stock based on a
formula defined in the several subscription agreements. The preferred stock is
convertible at various times after its issuance. The conversion price is based
on a discount to the market price of the Company's common stock on the date of
conversion. Because the Company's common stock has been delisted by NASDAQ,
there is uncertainty as to the number of shares of the Company's common stock
required to be issued in a preferred stock conversion.
10
<PAGE>
Vista 2000, Inc. And Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 29, 1996
(Dollar amounts in thousands except share and per share data)
(4) Stockholder's Equity (Deficit)-continued
The Company may not pay any common stock dividends unless all preferred
stock dividends have been paid.
(5) Related Party Transactions
ACPI leases two facilities from related parties. One building houses its
corporate headquarters and certain manufacturing and distribution operations.
The other building houses certain warehousing and distribution operations. The
leases have initial lease terms expiring in 1999 and 2001 and three five-year
renewal options. In accordance with a 1995 agreement, the Company made a cash
deposit payment to acquire these two facilities during the quarter ended March
30, 1996 of approximately $2,845. The balance of the approximate $7,000 purchase
price is to be satisfied through the assumption or refinance of certain mortgage
liabilities by the Company.
11
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
All statements, other than statements of historical fact, included in
this Quarterly Report including, without limitation, the statements under "
"Management" Discussion and Analysis of Financial Condition and Results of
Operations" are, or may be deemed to be, forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934. Important factors
that could cause actual results to differ materially from those discussed in
such forward-looking statements ("Cautionary Statements") include: the general
strength or weakness of the consumer products industry and the pricing policies
of competitors. All subsequent written and oral forward-looking statements
attributable to Vista or persons acting on the behalf of Vista are expressly
qualified in their entirety by such Cautionary Statements.
Sales and Cost of Sales
1996 Compared to 1995 Total revenues in the quarter ended June 29, 1996
were $27,169,000 versus $ 0 for the quarter ended June 30, 1995. The increase is
substantially attributable to the 1995 acquisitions of ACPI and Alabaster
subsequent to June 30, 1995. In addition operations and sales of FSPI commenced
during the third quarter of 1995. Cost of sales for the June 1996 period were
$20,363,000 compared to a cost of sales in the 1995 period of $ 0. 1996 gross
margins are approximately 25%. ACPI contributed approximately 88% of
consolidated revenues during June 1996 quarter.
Operating expenses
Operating expenses (selling, general and administrative expenses)
totaled $8,608,000 for the quarter ending June 29, 1996, as compared to
$1,368,000 for the same quarterly period of 1995. The increase is substantially
attributable to the 1995 acquisitions of ACPI and Alabaster subsequent to June
30, 1995. In addition operations and sales of FSPI commenced during the third
quarter of 1995.
Liquidity and Capital Resources
As of the June 1996 quarter the Company had $1,230,000 in cash and
equivalents. Management is actively reducing general overhead costs and is
exploring a variety of financing alternatives to raise cash. Under the ACPI
revolving line of credit, which extends through April 1997, the maximum amount
of the line was $28,900,000. The line availability as of June 29, 1996 was
$24,500,000 and the amount actually drawn down under the line was $21,600,000.
12
<PAGE>
PART II.--OTHER INFORMATION
Item 1. Legal Proceedings
From time to time, the Company is involved in lawsuits in the ordinary
course of business. Such lawsuits have not resulted in any material losses to
date, and the Company does not believe that the outcome of any existing lawsuits
would have a material adverse effect on its business.
During the quarter ended June 29, 1996, the Company together with
certain former officers, directors and third parties was named as a defendant in
approximately seventeen (17) class action lawsuits, filed by persons and
entities who purchased the common stock and warrants of the company during the
period November 11, 1994, through and including April 15, 1996, in the United
States District Court for the Northern District of Georgia. On July 9, 1996, the
district court ordered that the complaints be consolidated for all purposes. On
July 23, 1996, the plaintiffs filed a consolidated class action complaint
("Complaint") alleging violations of Section 10(b) of the Securities Exchange
Act of 1934, and Rule 10b-5 promulgated thereunder, and an additional claim
under Georgia common law for alleged negligent misrepresentations. The complaint
named as defendants the Company; Richard P. Smyth, the former Chairman of the
Board and Chief Executive Officer of the Company; Arnold E. Johns formerly
President and a director of the Company; Roemmich & Seymour ("R&S"), P.C.
("R&S"), the Company's former outside auditor; and the principals of R&S, Roger
Roemmich and J. Alan Seymour.
The Complaint alleged that throughout the period from November 11, 1994
through April 15, 1996, Vista issued materially false and misleading financial
statements that caused the market price of Vista securities to trade at
artificially inflated prices.
On August 29, 1996 the district court certified plaintiffs as
representatives of a of a class of all persons who purchased the Company's
common stock and/or warrants during the period from October 24, 1994 through
June 8, 1996 except the defendants, all present and former officers, directors
and employees of the Company, all underwriters of the Offering, members of the
immediate families of each of the foregoing and any person, firm, trust,
corporation, officer, director or other individual or entity in which any of the
defendants has a controlling interest or which is related to or affiliated with
any of the defendants, and the legal representatives, heirs,
successors-in-interest or assigns of any such excluded party. Also specifically
excluded from the Class were all individuals or entities who acquired Vista
common stock and/or warrants through Vista's employee profit sharing,
retirement, benefit or incentive program.
On March 14, 1997, a settlement was confirmed by the entry of a Final
Judgment and Order of Dismissal with Prejudice. The settlement provides, among
other things, that the Company will issue shares of its common stock (and
provide certain anti-dilution protection) to the plaintiffs and the Class in
order to convey ownership of 40% of the Company's common stock. The Company's
insurance carrier also contributed $300,000 to the settlement. The settlement is
in satisfaction of all claims of the Class.
13
<PAGE>
Item 1. Legal Proceedings-(continued)
The Company has been notified by the Securities and Exchange Commission
("SEC") that it has commenced an informal investigation of the Company. The
Company intends to cooperate with the SEC in this matter. The Company cannot
predict the eventual outcome of this investigation. Independently, the Company
through its Audit Committee has conducted an internal investigation of the facts
and circumstances surrounding the investigation.
Management and legal counsel are unable to determine the possible
outcome of these matters at this time. Accordingly, no liability for possible
losses has been accrued for these matters.
Item 2. Changes in Securities
There have been no material modifications in the instruments defining
the rights of shareholders. None of the rights evidenced by the shares of the
Company's common stock have been materially limited or qualified by the issuance
or modification of any other class of securities.
Item 3. Defaults Upon Senior Securities
There have been no material defaults in the payment of principal,
interest, sinking fund installment or any other material default not cured
within 30 days, with respect to any indebtedness of the Company exceeding five
percent (5%) of the total assets of the Company.
Item 4. Submission of Matters to a Vote of Security holders
During the period covered by this report, no matters were submitted to
the vote of the Security holders of the Company.
Item 5. Other Information
On June 7, 1996, Vista elected six (6) new directors to its Board of
Directors, bringing the total number of directors to nine (9). These new
directors had not previously been associated with the Company, other than as
stockholders. On July 17, 1996, the remaining three (3) original directors
resigned their positions. Their positions have not been subsequently filled. On
November 12, 1996, one (1) of the new directors resigned leaving five (5)
directors currently serving on the Board of Directors.
Item 6. Exhibits and Reports on Form 8-K
(a) See Index to Exhibits.
14
<PAGE>
Item 6. Exhibits and Reports on Form 8-K-(continued)
(b) On June 6, 1996 the company filed an 8-K for the fiscal year ended
December 30, 1995, which included its consolidated financial statements for the
fiscal year and its Report of Certified Public Accountants.
15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
VISTA 2000, INC.
Dated: April 18, 1997 By: /s/ G. Louis Graziadio, III
-------------- ------------------------------------------
G. Louis Graziadio, III
Chief Executive Officer (principal
executive officer)
Dated: April 18, 1997 By: /s/ Larry C. Cobb
-------------- ------------------------------------------
Larry C. Cobb
Interim Chief Financial Officer
(principal financial officer)
16
<PAGE>
INDEX TO EXHIBITS
(2) Plan of Acquisition, Reorganization, Arrangements, Liquidation or
Succession. Not applicable.
(3) (i) Articles of Incorporation
3.1(a) Certificate of Incorporation (Exhibit 3.1)
(ii) By-Laws
3.2(a) By-Laws (Exhibit 3.2)
(4) Instruments defining rights of security holders, including indentures
4.1(c) Specimen of Common Stock Certificate (Exhibit 4.1)
4.2(a) Form of Warrant Agreement covering Series A Warrants (Exhibit 4.2)
4.3(c) Specimen of Series A Warrant (Exhibit 4.3)
4.4(b) Form of Preferred Stock Certificate covering Series A Preferred Stock
(Exhibit 4.1)
4.5(b) Form of Preferred Stock Certificate covering Series B Preferred Stock
(Exhibit 4.2)
4.6(b) Form of Preferred Stock Subscription Agreement covering Series B
Preferred Stock (Exhibit 4.3)
4.7(b) Form of Preferred Stock Certificate covering Series C Preferred Stock
(Exhibit 4.4)
4.8(b) Form of Preferred Stock Certificate covering Series D Preferred Stock
(Exhibit 4.5)
4.9(b) Form of Preferred Stock Subscription Agreement covering Series D
Preferred Stock (Exhibit 4.6)
(10) Material Contracts
10.1(a) Lease Agreement, dated January 5, 1993 between Roswell Business
Centers Associates, LP and the Company as amended. (Exhibit 10.1)
10.2(a) Patent Rights Purchase Agreement, dated October 1, 1993 between Blue
Ridge Ventures, Inc. and the Company. (Exhibit 10.2)
10.3(a) 1993 Incentive Stock Option Plan (Exhibit 10.4)
<PAGE>
10.4(b) 1993 Non-Employee Director Stock Option Plan, as amended. (Exhibit
10.2)
10.5(a) Form of Series 1992B 15% Subordinated Debenture, as amended. (Exhibit
10.8)
10.6(a) Form of 1992B Warrant to Purchase Common Stock. (Exhibit 10.9)
10.7(a) Form of Series 1993A 15% Subordinated Convertible Debenture. (Exhibit
10.10)
10.8(a) Form of 1993A Warrant to Purchase Common Stock. (Exhibit 10.11)
10.9(d) Form of Employment Agreement to be entered into between the Company
and Robert M. Fuller, Richard P. Smyth and Norman W. Wicks,
respectively. (Exhibit 10.12)
10.10(a) Nonstatutory Stock Option Agreement dated December 1, 1993 between
Robert M. Fuller and the Company. (Exhibit 10.27)
10.11(a) Nonstatutory Stock Option Agreement dated December 1, 1993 between
Richard P. Smyth and the Company. (Exhibit 10.28)
10.12(a) Nonstatutory Stock Option Agreement dated December 1, 1993 between
Norman W. Wicks and the Company. (Exhibit 10.29)
10.13(b) Prospectus for the Company's 1993 Incentive Stock Option Plan and 1993
Non-Employee Director Stock Option Plan. (Exhibit 10.1)
10.14(b) First Amendment to the Company's 1993 Incentive Stock Option Plan.
(Exhibit 10.1)
10.15(b) Employment Agreement between the Company and Arnold E. Johns, Jr.
(Exhibit 10.4)
10.16(b) Employment Agreement between the Company's subsidiary, American
Consumer Products, Inc., and Richard Bern. (Exhibit 10.5)
10.17(b) Employment Agreement between the Company's subsidiary, Alabaster
Industries, Inc., and Daniel A. Norris. (Exhibit 10.6)
10.18(b) Employment Agreement between the Company's subsidiary, American
Consumer Products, Inc., and Stephen W. Cole. (Exhibit 10.7)
10.19(f) Employment Agreement between the Company and Robert E. Altenbach.
(Exhibit 10.19)
<PAGE>
(11) Statement re Computation of Per Share Earnings
11.1 Statement re computation of per share earnings is included herein as
Exhibit 11.1 of this Report.
(15) Letter re Unaudited Interim Financial Information Incorporated by
reference, see Page 8 of this Form 10-Q for the Quarter ended June 29,
1996.
(18) Letter re Change in Accounting Principles
Not applicable.
(19) Report Furnished to Security Holders
Not applicable.
(21) Subsidiaries of the Registrant
21.1(e) Subsidiaries of the Registrant. (Exhibit 21.1)
(23) Consents of Experts and Counsel
Not applicable.
(24) Power of Attorney
Not applicable.
(27) Financial Data Schedule (Filed only by Electronic Filers)
27.1 Financial Data Schedule
(99) Additional Exhibits
None.
- ----------
(a) Exhibit previously filed as part of and is incorporated herein by reference
to the Company's Registration Statement on Form SB-2 (Registration No.
33-73118-A). The exhibit number contained in parenthesis refers to the
exhibit number in such Registration Statement.
(b) Exhibit previously filed as part of and is incorporated herein by reference
to the Company's Current Report on Form 8-K dated June 29, 1996. The
exhibit number contained in parenthesis refers to the Exhibit number in
such Form 8-K.
(c) Exhibit previously filed as part of and is incorporated by reference to
Amendment No. 2 to the Company's Registration Statement on Form SC-2
(Registration No. 33-73118-A). The exhibit number contained in parenthesis
refers to the exhibit numbers in such Registration Statement.
<PAGE>
(d) Exhibit previously filed as part of and is incorporated by reference to
Amendment No. 1 to the Company's Registration Statement on Form SC-2
(Registration No. 33-73118-A). The exhibit number contained in parenthesis
refers to the exhibit numbers in such Registration Statement.
(e) Exhibit previously filed as part of and is incorporated herein by reference
to the Company's Current Report on Form 10-K for the fiscal year ended
December 30, 1995. The exhibit number contained in parenthesis refers to
the Exhibit number in such Form 10-K.
(f) Exhibit previously filed as part of and is incorporated herein by reference
to the Company's Current Report on Form 10-Q for the quarter ended March
30, 1996. The exhibit number contained in parenthesis refers to the Exhibit
number in such Form 10-Q.
<PAGE>
Exhibit 11.1
Share Computation
Quarter ended June 29, 1996
<TABLE>
<CAPTION>
Common Stock
--------------------------------------------------------------
Preferred Total less Weighted Average
Stock Total Treasury Treasury Shares
--------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Shares outstanding at beginning of quarter 14,280 14,298,595 (116,100) 14,182,495 14,182,495
Treasury shares purchased (5,000) (5,000) (4,670)
Exercise of warrants 0
Exercise of stock options 0
Preferred stock sold 0
Preferred converted to common (10,060) 3,776,375 3,776,375 2,595,102
Common stock sold 0
--------------------------------------------------------------------------
Shares outstanding at end of quarter 4,220 18,074,970 (121,100) 17,953,870 16,772,927
==========================================================================
Net Loss $ (1,708,000)
Weighted average shares 16,772,927
Loss per share ($0.10)
=============
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE JUNE 29, 1996 UNAUDITED FINANCIAL STATEMENTS OF VISTA
2000, INC., AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS IN FORM 10-Q FOR THE QUARTER ENDED
JUNE 29, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-30-1996
<PERIOD-START> MAR-31-1996
<PERIOD-END> JUN-29-1996
<CASH> 1,230,000
<SECURITIES> 0
<RECEIVABLES> 16,143,000
<ALLOWANCES> 1,866,000
<INVENTORY> 39,661,000
<CURRENT-ASSETS> 57,135,000
<PP&E> 17,336,000
<DEPRECIATION> 1,843,000
<TOTAL-ASSETS> 76,047,000
<CURRENT-LIABILITIES> 16,499,000
<BONDS> 0
0
3,984,000
<COMMON> 181,000
<OTHER-SE> 33,528,000
<TOTAL-LIABILITY-AND-EQUITY> 76,047,000
<SALES> 27,169,000
<TOTAL-REVENUES> 27,169,000
<CGS> 20,363,000
<TOTAL-COSTS> 8,608,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 464,000
<INCOME-PRETAX> (1,708,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,802,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,708,000)
<EPS-PRIMARY> (0.10)
<EPS-DILUTED> 0<F1>
<FN>
<F1> Not displayed since calculation would be anti-dilutive.
</FN>
</TABLE>
