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
For the Transition Period From _______________ to ________________.
Commission file number 0-27560
ACT Teleconferencing, Inc.
(Name of small business issuer as specified in its charter)
Colorado 84-1132665
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1658 Cole Blvd., Suite 130, Golden, Colorado 80401
(Address of principal executive offices) (Zip Code)
(303) 233-3500 (303) 238-0096
(Issuer's telephone number, (Issuer's facsimile number,
including area code) including area code)
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 August 12, 1997, 3,290,100 shares of the issuer's common stock were
outstanding.
<PAGE>
ACT TELECONFERENCING, INC.
FORM 10-QSB
Table of Contents
<TABLE>
<CAPTION>
PART I. Financial Information Page No.
<S> <C> <C>
Item 1. Financial Statements 3
Consolidated Balance Sheets 3
Consolidated Statements of Operations 4
Consolidated Statements of Shareholders' Equity 5
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 7
Item 2. Management Discussion and Analysis
of Financial Condition and Results of
Operations 8
PART II. Other Information
Item 4. Submission of Matters to a vote of Security Holders 11
Item 5. Other Information
Schedule 13D 11
Item 6. Exhibit Index 12
Reports on Form 8-K 12
SIGNATURES 13
</TABLE>
<PAGE>
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ACT Teleconferencing, Inc.
Consolidated Balance Sheets
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1997 1996
------------------- --------------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 836,788 $ 621,742
Accounts receivable (net of allowances) 2,444,692 1,356,471
Prepaid expenses 230,318 55,994
Inventory 121,769 125,850
Available for sale marketable securities 50,000 50,000
------------------- --------------------
Total current assets 3,683,567 2,210,057
Equipment:
Telecommunications equipment 1,944,768 1,664,697
Office equipment 866,012 702,019
Less: accumulated depreciation (878,097) (736,556)
------------------- --------------------
Total equipment - net 1,932,683 1,630,160
Goodwill 236,032 245,052
------------------- --------------------
Total assets $5,852,282 $4,085,269
=================== ====================
LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities:
Notes payable $ 228,628 $ 74,784
Accounts payable 886,007 764,520
Accrued liabilities 540,346 339,299
Current portion of long term debt 175,009 177,312
Income taxes payable 270,140 156,991
------------------- --------------------
Total current liabilities 2,100,130 1,512,906
Long-term debt 366,667 395,960
Deferred income taxes 40,632 41,042
Minority interest 464,801 367,404
Shareholders' equity:
Preferred stock, no par value, 1,000,000 shares
authorized; none issued - -
Common stock, no par value; 10,000,000 shares
authorized; 3,290,100 and 2,939,930 shares issued
and outstanding in 1997 and 1996, respectively 5,133,485 4,022,671
Accumulated deficit (2,253,807) (2,292,261)
Currency translation adjustment 374 37,547
------------------- --------------------
Total shareholders' equity 2,880,052 1,767,957
------------------- --------------------
Total liabilities and shareholders' equity $ 5,852,282 $ 4,085,269
=================== ====================
</TABLE>
<PAGE>
ACT Teleconferencing, Inc.
Consolidated Statements of Operations
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30,
1997 1996
------------------ ---------------------
(Unaudited)
<S> <C> <C>
Net revenues $ 2,504,574 $ 1,565,106
Costs and expenses:
Cost of teleconferencing services (967,437) (976,120)
Marketing, general and administration costs (1,398,376) (760,413)
------------------ ---------------------
Total costs and expenses (2,365,813) (1,736,533)
Income (loss) before taxes and minority interest 138,761 (171,427)
Provision for income taxes (83,887) (17,149)
------------------ ---------------------
Income (loss) before minority interest 54,874 (188,576)
Minority interest in earnings of consolidated subsidiary (29,580) (14,185)
------------------ ---------------------
Net income (loss) for the period $ 25,294 $ (202,761)
================== =====================
Net income (loss) per share $ 0.01 $ (0.07)
================== =====================
Weighted average number of shares outstanding 2,956,122 3,035,350
================== =====================
SIX MONTHS ENDED JUNE 30,
1997 1996
------------------ ---------------------
(Unaudited)
Net revenues $ 4,622,228 $ 2,937,546
Costs and expenses:
Cost of teleconferencing services (1,837,023) (1,747,703)
Marketing, general and administration costs (2,535,479) (1,440,179)
------------------ ---------------------
Total costs and expenses 4,372,502 (3,187,882)
Income (loss) before taxes and minority interest 249,726 (250,336)
Provision for income taxes 113,875 (59,050)
------------------ ---------------------
Income (loss) before minority interest 135,851 (309,386)
Minority interest in earnings of consolidated subsidiaries 97,397 (47,972)
------------------ ---------------------
Net income (loss) for the period $ 38,454 $ (357,358)
================== =====================
Net income (loss) per share $ 0.01 $ (0.13)
================== =====================
Weighted average number of shares outstanding 2,948,071 2,777,868
================== =====================
</TABLE>
<PAGE>
ACT Teleconferencing, Inc.
Consolidated Statements of Shareholders' Equity
<TABLE>
<CAPTION>
Common Stock
-------------------------------
Currency
Accumulated Translation
Shares Amount Deficit Adjustment Total
--------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Balance at December 31, 1995 2,318,000 $2,157,940 $(1,084,154) - $1,073,786
Shares issued for cash 712,497 1,987,531 - - 1,987,531
Expiration of put issued in
connection with prior year acquisition - 125,000 - - 125,000
Reduction of purchase price
related to videoconferencing acquisition (100,000) (250,000) - - (250,000)
Cash-less exercise of employee
stock options 8,333 - - - -
Exercise of employee stock options 1,100 2,200 - - 2,200
Currency translation adjustment - - - 37,547 37,547
Net Loss for the year - - (1,208,107) - (1,208,107)
--------------------------------------------------------------------------------
Balance December 31, 1996 2,939,930 $4,022,671 $(2,292,261) $ 37,547 $1,767,957
Exercise of employee stock options 20,500 23,000 23,000
Shares issued in connection with 329,670 1,087,814 1,087,814
exercise of 1994 and 1995 privately
placed warrants
(net of expenses)
Net income 38,454 38,454
Currency translation adjustment (37,173) (37,173)
--------------------------------------------------------------------------------
Balance at June 30, 1997 (Unaudited) $3,290,100 $5,133,485 ($2,253,807) $374 $2,880,052
================================================================================
</TABLE>
<PAGE>
ACT Teleconferencing, Inc.
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30,
1997 1996
-------------------- -------------------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ 38,454 $ (357,358)
Adjustments to reconcile net income to
net cash used for operating activities:
Depreciation 141,541 130,244
Amortization of goodwill 9,020 20,114
Deferred income tax (410) -
Minority interest 97,397 47,813
-------------------- -------------------
Cash flow before changes in operating assets and liabilities: 286,002 (159,187)
Accounts receivable (1,088,221) (649,418)
Inventory 4,081
Prepaid expenses and other assets (174,324) (61,641)
Accounts payable and accrued liabilities 322,536 215,966
Income taxes payable 113,149 58,874
-------------------- -------------------
Net cash used for operating activities (536,777) (595,406)
INVESTING ACTIVITIES
Property and equipment purchases (444,064) (448,882)
-------------------- -------------------
Net cash flow before financing activity (980,841) (1,044,288)
FINANCING ACTIVITIES
Net proceeds from issuance (repayment) of debt 122,248 (66,742)
Net proceeds from issuance of common stock 1,110,812 1,987,533
-------------------- -------------------
Net cash after financing activities (252,219) 876,503
Effect of change in exchange rate on cash (37,173) (3,313)
-------------------- -------------------
Net increase in cash and cash equivalents $ 215,046 $ 873,190
==================== ===================
Cash and cash equivalents, beginning of year $ 621,742 $ 288,345
Cash and cash equivalents, end of year 836,788 1,161,535
-------------------- -------------------=
Net increase in cash $ 215,046 $ 873,190
==================== ===================
</TABLE>
<PAGE>
ACT Teleconferencing, Inc.
Notes to Consolidated Financial Statements
(Unaudited)
BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and Item 310(b)
of Regulation S-B. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary of a fair presentation have
been included. Operating results for the six-month period ending June 30, 1997
are not necessarily indicative of the results that may be expected for the year
ended December 31, 1997. For further information, refer to the financial
statements and footnotes thereto included in the Company's annual report on Form
10-KSB for the year ended December 31, 1996.
BUSINESS
ACT Teleconferencing, Inc. (the Company) is engaged in the business of providing
high-quality audio, data, and video conferencing products and services to
business clients. The Company operates in the United States, the United Kingdom,
the Netherlands, Belgium and Australia.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of ACT
Teleconferencing, Inc., its wholly owned domestic subsidiaries ACT
Teleconferencing Services, Inc., ACT VideoConferencing, Inc., ACT Research,
Inc., its 60% owned United Kingdom subsidiary, ACT Teleconferencing Limited, its
80% owned Australian subsidiary, ACT Teleconferencing (Proprietary) Limited, and
its 100% owned Netherlands subsidiary, ACT Teleconferencing, B.V. All material
intercompany transactions and balances have been eliminated.
EQUIPMENT AND DEPRECIATION
Equipment is stated at cost. Depreciation is calculated on a straight-line basis
over the estimated useful lives of five years for furniture and five or ten
years for equipment. Depreciation expense includes capital lease amortization
charges.
NET EARNINGS (LOSS) PER SHARE
Net earnings (loss) per share are computed based upon the weighted average
number of shares of common stock outstanding during the period. Options and
warrants are not included in the computations since their effect is presently
either anti-dilutive or not material. In February 1997, the Financial Accounting
Standards Board issued Statement No. 128, EARNINGS PER SHARE, which is required
to be adopted on December 31, 1997. At that time, the Company will be required
to change the method used to compute earnings per share and to restate all prior
periods. Under the new requirements for calculating primary earnings per share,
the dilutive effect of stock options will be excluded. The expected impact of
Statement No. 128 on these quarters is not expected to be material.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
THE MANAGEMENT'S DISCUSSION AND ANALYSIS SECTION OF THIS REPORT
CONTAINS FORWARD-LOOKING STATEMENTS, WHICH ARE SUBJECT TO CERTAIN RISKS
AND UNCERTAINTIES. CERTAIN SUCH STATEMENTS ARE REPEATED AT THE END OF
THIS MANAGEMENT'S DISCUSSION AND ANALYSIS SECTION TOGETHER WITH
SPECIFIC CAUTIONARY STATEMENTS IDENTIFYING FACTORS THAT COULD CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM CURRENT EXPECTATIONS CONTAINED
IN EACH SUCH STATEMENT. FORWARD-LOOKING STATEMENTS ALSO MAY BE IMPLICIT
BUT NOT READILY IDENTIFIED WITHIN THE CONTEXT OF OTHER STATEMENTS. IN
GENERAL, AMONG THE FACTORS THAT COULD AFFECT THE COMPANY'S ACTUAL
RESULTS AND COULD CAUSE RESULTS TO DIFFER FROM THOSE CONTAINED IN THE
FORWARD-LOOKING STATEMENTS ARE THE CONTINUED ABILITY OF THE COMPANY TO
GENERATE REVENUE GROWTH IN AUDIO TELECONFERENCING, THE GENERAL RATE OF
DEVELOPMENT OF THE MARKET FOR VIDEOCONFERENCING SERVICES, AND THE
AVAILABLE OPPORTUNITIES TO EXPLORE NEW FOREIGN MARKETS. OTHER FACTORS
COULD ALSO CAUSE ACTUAL RESULTS TO VARY MATERIALLY FROM THE ANTICIPATED
RESULTS COVERED IN SUCH FORWARD-LOOKING STATEMENTS.
OVERVIEW
The Company completed a satisfactory second quarter in terms of both maintaining
revenue growth and achieving profitability. Second quarter revenues grew by 60%
over the second quarter 1996, reflecting continued growth in the market for
audio teleconferencing services as well as additional market share gains made by
the Company. Revenue growth for the first six months of the year amounted to 57%
compared to same period in the previous year.
Net income after taxes and minority interest amounted to $25,294, an improvement
of $179,891 over the corresponding previous quarter last year, due mainly to
continued growth in the Company's North American and European operations. Net
income after taxes and minority interest for the six-month period amounted to
$38,454 reflecting an improvement of $395,812 over the same period in 1996.
The Company anticipates continued growth in audio teleconferencing revenues in
its operations in North America and Europe. On May 15, 1997, the Company
announced the opening of its Australian teleconferencing operation as a first
step towards developing its market for teleconferencing on the Pacific Rim and
accelerating the company's global expansion plan.
In March 1997, an agreement was reached in the United States with AT&T to
co-market the Company's ActionView product range of videoconferencing systems.
Implementation of this agreement remains in the early stages, and it is not
possible to determine the extent to which it may impact the Company's revenues.
The market for videoconferencing continues to grow in terms of both the quality
of transmission and diversity of application. The Company is presently engaged
in both the equipment and videobridging market sectors.
COMPONENTS OF REVENUE AND EXPENSE
The Company derives revenues principally from fees charged to clients for audio
teleconference "bridging" services which interconnect multiple parties to a
conference call, from fees for enhanced services which supplement conference
calls, and from re-billing long-distance charges at a margin in excess of the
rate paid by the Company for its volume purchases of long-distance service.
The costs of teleconferencing services consist of local and long-distance
telephone services, depreciation on equipment, salaries, benefits, and office
expenses of conference reservationists and coordinators, who plan, organize, and
manage teleconferences.
Marketing, general and administrative costs consist of salaries, benefits, and
office expenses of the Company's administrative, market development, and sales
organizations.
<PAGE>
RESULTS OF OPERATIONS
QUARTER ENDED JUNE 30, 1997, COMPARED TO QUARTER ENDED JUNE 30, 1996
NET REVENUES. Net revenues increased by 60% to $2.5 million for the quarter
ended June 30, 1997, compared to $1.6 million for the same period in 1996,
primarily due to increased sales of audio teleconferencing services. Revenue
growth resulted from repeat sales to established customers and increased sales
of enhanced services as well as from sales to new customers. During the period,
domestic (North American) operations accounted for 49% of net revenues, compared
to 51% for the prior period.
COST OF TELECONFERENCING SERVICES. Cost of teleconferencing services decreased
to $967,437 for the second quarter, compared to $976,120 for the previous
comparative quarter, reflecting the impact of productivity improvements achieved
during 1997. Gross margin (net revenues less costs of conferencing services
divided by net revenues) for the second quarter ended June 30, 1997 increased to
61.4% percent, compared to 37.6% achieved during the prior comparative quarter.
The increase in gross margin was achieved by the increased sales of value-added
products as well as from increased productivity.
MARKETING, GENERAL AND ADMINISTRATIVE COSTS. Marketing, General, and
Administrative expenses for the second quarter were $1,398,376, or 56% of
revenue, compared to $760,413 or 49% of revenue for 1996. The 84% increase in
such expenses reflects an aggressive increase in audio teleconferencing sales
efforts, as well as development costs for the Company's new business units in
Europe and Australia, the entry into videoconferencing, and new international
market development costs.
INCOME (LOSS) BEFORE TAXES AND MINORITY INTEREST. Income before taxes and
minority interest amounted to $138,761, compared to a loss before taxes and
minority interest of $171,427 for the previous corresponding quarter. This
improvement was caused by the combination of increased revenues, better margins
and improved productivity as described above.
TAXES ON INCOME AND MINORITY INTEREST. Taxes on income and minority interest
amounted to $113,467 for the quarter ended June 30, 1997, compared to $31,334
for 1996, primarily due to taxes paid on and minority interest in earnings
achieved by the Company's 60% majority-owned United Kingdom subsidiary which
pays full tax. The Company paid no United States income tax due to net operating
losses incurred in its United States operations in previous years.
NET INCOME. Net income amounted to $25,294 or an improvement of $228,055 for the
quarter.
SIX MONTH PERIOD ENDED JUNE 30, 1997, COMPARED TO SIX MONTH PERIOD ENDED JUNE
30, 1996
NET REVENUES. Net revenues increased by 57% to $4.6 million for the six months
ended June 30, 1997, compared to $2.9 million for the same period in 1996,
primarily due to increased sales of audio teleconferencing services as described
above. During this period, domestic operations accounted for 49% of net
revenues, compared to 51% for the prior period. International revenues accounted
for 51% of revenues compared to 49% for the prior period.
COST OF TELECONFERENCING SERVICES. Cost of teleconferencing services amounted to
$1,837,023 compared to $1,747,703 or an increase of 5% for the six-month period.
Gross margin (net revenues less costs of conferencing services divided by net
revenues) increased to 60.2%, compared to 40.5% achieved during the previous
comparable period.
MARKETING, GENERAL AND ADMINISTRATIVE COSTS. Marketing, General and
Administrative expenses were $2,535,479 or 55% of revenue, compared to
$1,440,179 or 49% of revenue for 1996. The reasons for growth of 76% in such
expenses are due to increased selling and development efforts as described
above.
INCOME (LOSS) BEFORE TAXES AND MINORITY INTEREST. Income before taxes and
minority interest amounted to $249,726, compared to a loss before taxes and
minority interest of $250,336 incurred for the previous period in 1996
corresponding period. The improvement of $500,062 was caused by the combination
of increased revenues, better margins and improved productivity as described
above.
<PAGE>
TAXES ON INCOME AND MINORITY INTEREST. Taxes on income and Minority interest
amounted to $211,272 for the six months ended June 30, 1997, compared to
$107,022 for 1996, primarily due to taxes paid on and minority interest in
earnings achieved by the Company's 60% majority-owned United Kingdom subsidiary
which pays full tax.
NET INCOME. Net income amounted to $38,454 or an improvement of $395,912 for the
six month period.
LIQUIDITY AND CAPITAL RESOURCES (SIX MONTHS ENDED JUNE 30, 1997)
During the six months ended June 30, 1997, net cash increased by $215,046. At
June 30, 1997, the Company had cash and cash equivalents of $836,788 compared to
cash and cash equivalents on hand in 1996 of $671,742.
The Company generated net proceeds of $1,110,814 pursuant to the conversion of
certain warrants, arising from private placement of stock issued in 1994 and
which were exercised into common stock during the second quarter. Capital thus
raised was used primarily to finance the purchase of equipment and the growth in
working capital due to sales growth.
Cash from operating activities before funding operating assets such as accounts
receivable amounted to $286,002 compared to a cash outflow recorded for 1996 of
$159,187 or an improvement in cash from operating activities as defined above of
$445,189. Cash after financing operating assets and liabilities amounted to a
net outflow of $536,777 reflecting mainly the significant growth in accounts
receivable of $1,088,221.
During the six-month period, the Company invested $444,064 in additional
equipment, to provide ongoing new technology and capacity to the United States
and European operations. The gross cash outflow (after capital investment and
before financing arrangement of $980,841) was funded by a combination of debt
and equity finance amounting to $1,233,060 and resulting in a net cash inflow
(before effect of exchange rate changes) amounting to $252,219.
The Company believes that, given the present rate of sales and profit growth in
its core audio teleconferencing business, it will have sufficient cash resources
to meet its working capital needs for the next 12 months. The Company has
further plans to expand capacity and open new operations in new geographic
locations, and to develop its videoconferencing business. These expansion plans
will be financed using a mix of lease financing for capital equipment and the
anticipated conversion of certain remaining share warrants during August of
1997.
During the period the company completed a post-effective amendment registration
statement concerning 712,497 publicly traded warrants, which are exercisable
until March 2, 1999 at $5.00 per share. The gross proceeds from the above
warrants, should they be fully converted, would amount to approximately $3.5
million.
FORWARD-LOOKING STATEMENTS
CERTAIN STATEMENTS MADE ABOVE, SOME OF WHICH ARE SUMMARIZED BELOW, ARE
FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES, AND
ACTUAL RESULTS MAY BE MATERIALLY DIFFERENT. FACTORS THAT COULD CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE IN THE FORWARD-LOOKING
STATEMENT INCLUDE (BUT ARE NOT LIMITED TO) THE FOLLOWING:
VIDEOCONFERENCING CONTINUES TO GROW IN TERMS OF BOTH THE QUALITY OF TRANSMISSION
AND DIVERSITY OF APPLICATION. THE COMPANY IS ENGAGED IN BOTH THE EQUIPMENT AND
VIDEOBRIDGING SECTORS OF THE MARKET. Slower-than-expected implementation of the
AT&T agreement or slower-than-expected development of the videoconferencing
market generally could slow the rate of sales growth of videoconferencing
hardware and services for the Company.
<PAGE>
THE COMPANY ANTICIPATES CONTINUED GROWTH IN AUDIO TELECONFERENCING REVENUES WILL
CONTINUE IN ITS OPERATIONS IN NORTH AMERICA AND EUROPE. A significant downturn
in economic conditions generally or the development of alternative technologies
could render teleconferencing less effective and could affect the rate of growth
of audio teleconferencing revenues.
THE COMPANY BELIEVES THAT, GIVEN THE PRESENT RATE OF SALES AND PROFIT GROWTH IN
ITS CORE AUDIO TELECONFERENCING BUSINESS, IT HAS SUFFICIENT CASH RESOURCES TO
MEET ITS WORKING CAPITAL NEEDS FOR THE COMING YEAR. Failure to maintain ongoing
profit margins, resulting in a higher level of cash utilization, could result in
the Company deferring other expansion plans or could cause it to seek additional
financing in the capital markets for its future growth plans and working capital
needs.
THE COMPANY HAS FURTHER PLANS TO EXPAND ITS CAPACITY AND OPEN NEW OPERATIONS IN
NEW GEOGRAPHIC LOCATIONS, AND TO DEVELOP ITS VIDEOCONFERENCING BUSINESS. Lack of
borrowing or leasing capacity or the failure to generate high margin earnings
could delay the Company's forward growth plans.
THESE EXPANSION PLANS WILL BE FINANCED USING A MIX OF LEASE FINANCING FOR
CAPITAL EQUIPMENT AND THE ANTICIPATED CONVERSION OF CERTAIN REMAINING SHARE
WARRANTS DURING AUGUST OF 1997. THE GROSS PROCEEDS FROM THE ABOVE WARRANTS,
SHOULD THEY BE FULLY CONVERTED, WOULD AMOUNT TO APPROXIMATELY $3.5 MILLION. If
the Company's common stock declines substantially or some other event
discourages warrant-holders from exercising all or a substantial part of these
warrants, the Company would need to seek other financing for its growth.
PART II -- OTHER INFORMATION
ITEM 4. Submission of Matters to a Vote of Security Holders
At the annual shareholders meeting on June 18, 1997,
shareholders approved the adoption of the Stock Option Plan of
1996 and re-elected an incumbent director. Voting results were
as follows:
<TABLE>
<CAPTION>
For Against Withheld or Broker
Abstain Non-Votes
<S> <C> <C> <C> <C> <C>
Stock Option Plan of 1996 1,308,879 8,500 9,600 909,222
Percent 58.5% 0.3% 0.4% 40.8%
James L. Seifert 2,308,201 0 0 0
Percent 100% 0% 0% 0%
</TABLE>
Shares represented in person or by proxy were 2,308,201 out of
2,952,430 shares outstanding.
ITEM 5. Other Information
Schedule 13D dated July 23, 1997 was filed with the Securities
and Exchange Commission by Anchor Investments, Inc. reporting
a holding of 1,244,710 shares (37.9%) of the Company's common
stock.
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
EXHIBIT INDEX
Exhibit No. Description
3.1(2) Restated Articles of Incorporation of the Company dated April
15, 1996
3.2(2) Bylaws of the Company, amended as of April 15, 1996
4.1(1) Form of specimen certificate for Common Stock of the Company
4.2(1) Form of Unit Purchase Option to be issued by the Company to
the Underwriter
4.3(1) Impound Agreement
4.4(1) Lock-up Letter Agreement
10.1(1) Stock Option Plan of 1991, as amended, authorizing 400,000
shares of Common Stock for issuance pursuant to the Plan
10.2(1) Form of Stock Option Agreement
10.3(1) Form of Common Stock Purchase Warrant
10.4(1) Form of Placement Agent Warrant
10.5(1) Denver West Office Building Lease dated April 1, 1993, by and
between Denver West Office Building No. 6 Venture and the
Company, as amended
10.6(1) Leases for United Kingdom facilities (First floor of Howard
House) dated September 29, 1993 and April 17, 1995, between
Garfunkel & Wanderer Limited and Reichwald Brothers
10.7(1) Letter agreement dated May 31, 1995 with Worldcom regarding
lease of Amsterdam facilities
10.8(1) Sublease Agreement with Integraf Corporation dated August
1995 for ACT Videoconferencing, Inc. premises
10.9(1) Term Loan Agreement dated August 11, 1994, between the Company
and Norwest Bank, N.A., Boulder Colorado
10.10(1) Split Dollar Insurance Agreement dated March 1, 1990, between
the Company and Gerald D. Van Eeckhout
10.11(1) Service Agreement dated April 10, 1992 between David Holden
and ACT Teleconferencing Limited
10.12(1) Stock Purchase Agreement dated July 13, 1995, between the
company and Paul Clifford for acquisition of NBS, Inc.
10.13(1) Employment Agreement dated July 14, 1995 between the Company
and Paul Clifford
10.14(1) Agreement between Company and Gerald D. Van Eeckhout limiting
his compensation in 1996 and 1997
10.15(1) Memorandum dated December 22, 1995 from director Seifert
amending Mr. Van Eeckhout's compensation
10.16(1) Terms of employment of Harry Walls, president-designate of ACT
Teleconferencing Services, Inc. per Company's letter dated
December 13, 1995
10.17(1) Agreement to Exchange Stock between Apogee Robotics, Inc. and
Company
10.18(1) Agreement between Company and Ronald J. Bach to borrow
proceeds from sale of Apogee Robotics common stock
10.19(3) Form of Stock Option Plan of 1996
27.1 Financial Data Schedule
(1) Exhibit incorporated by reference to the Company's Registration Statement
on Form SB-2, filed with the Securities and Exchange Commission on October
10, 1995, and amendments thereto. Exhibits incorporated by reference carry
exhibit numbers identical to those in the Registration Statement.
(2) Incorporated by reference to the exhibit of the same number to the
Company's Form 10-QSB for the Quarter ended June 30, 1996, File No.
0-27560.
(3) Incorporated by reference to the Company's Proxy Statement filed with the
Securities and Exchange Commission on April 30, 1997, File No. 0-27560.
REPORTS ON FORM 8-K
The Company filed no reports on Form 8-K during the quarter ended June 30,
1997.
<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.
ACT TELECONFERENCING, INC.
DATE: August 12, 1997 By: /s/ Gavin J. Thomson
Gavin J. Thomson,
Chief Financial Officer
(Duly authorized officer and
Principal Financial Officer)
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Description Page
<S> <C> <C>
3.1 Restated Articles of Incorporation of the Company dated April 15, 1996 Incorporated by reference
3.2 Bylaws of the Company, amended as of April 15, 1996 Incorporated by reference
4.1 Form of specimen certificate for Common Stock of the Company Incorporated by reference
4.2 Form of Unit Purchase Option to be issued by the Company to the
Underwriter Incorporated by reference
4.3 Impound Agreement Incorporated by reference
4.4 Lock-up Letter Agreement Incorporated by reference
10.1 Stock Option Plan of 1991, as amended, authorizing 400,000 shares of
Common Stock for issuance pursuant to the Plan Incorporated by reference
10.2 Form of Stock Option Agreement Incorporated by reference
10.3 Form of Common Stock Purchase Warrant Incorporated by reference
10.4 Form of Placement Agent Warrant Incorporated by reference
10.5 Denver West Office Building Lease dated April 1, 1993, by and between
Denver West Office Building No. 6 Venture and the Company, as amended Incorporated by reference
10.6 Leases for United Kingdom facilities (First floor of Howard
House) dated September 29, 1993 and April 17, 1995, between
Garfunkel & Wanderer Limited and Reichwald Brothers Limited,
Landlord, and ACT Teleconferencing Limited, Tenant Incorporated by reference
10.7 Letter agreement dated May 31, 1995 with Worldcom regarding lease of
Amsterdam facilities Incorporated by reference
10.8 Sublease Agreement with Integraf Corporation dated August 1995 for ACT
videoconferencing, Inc. premises Incorporated by reference
10.9 Term Loan Agreement dated August 11, 1994, between the Company and
Norwest Bank, N.A., Boulder, Colorado Incorporated by reference
10.10 Split Dollar Insurance Agreement dated March 1, 1990, between the
Company and Gerald D. Van Eeckhout Incorporated by reference
10.11 Service Agreement dated April 10, 1992 between David Holden and ACT
Teleconferencing Limited Incorporated by reference
10.12 Stock Purchase Agreement dated July 13, 1995, between the Company and
Paul Clifford for acquisition of NBS, Inc. Incorporated by reference
10.13 Employment Agreement dated July 14, 1995, between the Company and Paul
Clifford Incorporated by reference
10.14 Agreement between Company and Gerald D. Van Eeckhout limiting his
compensation in 1996 and 1997 Incorporated by reference
10.15 Memorandum dated December 22, 1995 from director Seifert amending Mr.
Van Eeckhout's compensation Incorporated by reference
10.16 Terms of employment of Harry Walls, president-designate of ACT
Teleconferencing Services, Inc. per Company's letter dated December
13, 1995 Incorporated by reference
10.17 Agreement to Exchange Stock between Apogee Robotics, Inc. and Company Incorporated by reference
10.18 Agreement between Company and Ronald J. Bach to borrow proceeds from
sale of Apogee Robotics common stock Incorporated by reference
10.19 Form of Stock Option Plan of 1996 Incorporated by reference
27.1 Financial Data Schedule Filed electronically
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Company's unaudited June 30, 1997 financial statements and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 836,788
<SECURITIES> 50,000
<RECEIVABLES> 2,444,692
<ALLOWANCES> 24,700
<INVENTORY> 121,769
<CURRENT-ASSETS> 3,683,567
<PP&E> 1,932,683
<DEPRECIATION> 878,097
<TOTAL-ASSETS> 5,852,282
<CURRENT-LIABILITIES> 2,100,130
<BONDS> 0
0
0
<COMMON> 5,133,485
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 5,852,282
<SALES> 4,622,228
<TOTAL-REVENUES> 4,622,228
<CGS> 1,837,023
<TOTAL-COSTS> 4,372,502
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 249,726
<INCOME-TAX> 113,875
<INCOME-CONTINUING> 38,454
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 38,454
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0.01
</TABLE>
