SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB/A
Amendment No. 1
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934: FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES ACT OF 1934:
for the transition period from ________ to ________.
Commission File Number 1-13012
H.E.R.C. PRODUCTS INCORPORATED
(Name of small business issuer in its charter)
Delaware 86-0570800
State of Incorporation or Organization IRS Employer Identification Number
2202 W. Lone Cactus Drive #15
Phoenix, Arizona 85027-2621
(Address of principal executive offices)
(602) 492-0336
(Issuer's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Exchange Act: None
Name of each exchange
Title of each class on which registered
------------------- -------------------
Common Stock, $.01 par value Boston Stock Exchange
Securities registered pursuant to Section 12(g) of the Exchange Act: None
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 [ ]
Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]
State issuer's revenues for its most recent fiscal year. $3,168,955
At March 11, 1999, the aggregate market value of the voting stock held by
non-affiliates of the registrant was $2,937,785 based on the closing market
price of the Common Stock on such date as reported by the OTC BB Market of
$0.39.
At March 11, 1999, there were 11,526,053 shares of Common Stock issued and
outstanding.
Transitional Small Business Disclosure Format: Yes [ ] No[X]
Documents Incorporated by Reference: None
<PAGE>
EXPLANATORY NOTE REGARDING AMENDMENT NO. 1:
This Amendment No. 1 is being filed solely to correct a "flawed" Financial
Data Schedule previously filed as Exhibit No. 27 to the Form 10-KSB filed with
the Commission on March 31, 1999.
1
<PAGE>
ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit No: Exhibit
- ----------- -------
(3)(1) Certificate of Incorporation of HERC, filed as Exhibit 3.1 to
HERC's Registration Statement (No. 33-75166).
(3)(2) By-Laws of HERC, filed as Exhibit 3.2 to HERC's Registration Statement
(No. 33-75166).
(3)(3) Certificate of Designations, Preferences and Other Rights and
Qualifications of the Class A Preferred Stock, as amended, filed as
Exhibit 99.1 to Form 8-K dated December 17, 1996.
(4)(1) Specimen of Common Stock certificate (reference also made to exhibit
3.1 and 3.2), filed as Exhibit 4.1 to HERC's Registration Statement
(No. 33-75166).
(4)(2) Form of Underwriter's Warrant Agreement and Warrant Certificate, filed
as Exhibit 4.2 to HERC's Registration Statement (No. 33-75166).
(4)(3) Form of Warrant Agreement issued to Perrin, Holden & Davenport Capital
Corporation dated December 17, 1996, filed as Exhibit 4.2 of Form 8-K
dated December 17, 1996.
(4)(4) Form of Agency Agreement between HERC and Perrin, Holden & Davenport
Capital Corporation dated as of November 15, 1996, as amended, filed as
Exhibit 4.3 of Form 8-K dated December 17, 1996.
(4)(5) Form of Warrant Agreement between HERC and GKN Securities Corp. dated
November 19, 1996, filed as Exhibit 4.5 of Registration Statement No.
333-19361.
(4)(6) Form of Warrant and Registration Rights Agreement between HERC and the
Equity Group, dated September 27, 1996, filed as Exhibit 4.6 of
Registration Statement No. 333-19361.
(10)(1) 1993 Incentive Stock Option Plan, as amended, filed as Exhibit 10.3 to
HERC's Registration Statement No. 33-75166.
(10)(2) Agency Agreement between HERC and GKN Securities Corporation dated
March 4, 1996, filed as Exhibit 10.8 to HERC's Annual Report on Form
10K-SB for the fiscal year ended December 31, 1995
(10)(3) Form of Purchase Option issued to GKN Securities Corporation and its'
designees, filed as Exhibit 10.9 to HERC's Annual Report on Form 10K-SB
for the fiscal year ended December 31, 1995
(10)(4) Form of Warrant Agreement issued to investors on April 3, 1996, filed
as Exhibit 10.10 to HERC's Annual Report on Form 10K-SB for the fiscal
year ended December 31, 1995
(10)(5) Form of Subscription Agreement between HERC and investors dated April
3, 1996, filed as Exhibit 10.11 to HERC's Annual Report on Form 10K-SB
for the fiscal year ended December 31, 1995
(10)(6) 1996 Performance Equity Plan, filed as Annex A to HERC's Proxy
Statement dated June 11, 1996.
(10)(7) Form of Purchase Option issued to GKN Securities Corporation and its
designees dated June 18, 1997, filed as Exhibit 10.15 to HERC's Form
10-KSB for the year ended December 31, 1997.
2
<PAGE>
(10)(8) Loan Agreement by and between HERC and InterEquity Capital Partners,
LLP dated September 15, 1997 filed as Exhibit 10.18 to HERC's Form
10-KSB for the year ended December 31, 1997.
(10)(9) Account Transfer and Purchase Agreement by and between HERC, H.E.R.C.
Consumer Products, Inc., and KBK Financial Incorporated dated September
22, 1997 filed as Exhibit 10.19 to HERC's Form 10-KSB for the year
ended December 31, 1997.
(10)(10) Agreement by and between HERC and the U.S. Navy dated August 8, 1997
filed as Exhibit 10.20 to HERC's Form 10-KSB for the year ended
December 31, 1997.
(10)(11) Lease by and between HERC and Roger Buttrum dated May 14, 1996 filed as
Exhibit 10.21 to HERC's Form 10-KSB for the year ended December 31,
1997.
(10)(12) Form of Warrant Agreement between HERC and Jerry Ludwig and Associates
dated September 3, 1997 filed as Exhibit 10.22 to HERC's Form 10-KSB
for the year ended December 31, 1997.
(10)(13) Form of Warrant Agreement between HERC and Shelby Carl dated September
3, 1997 filed as Exhibit 10.23 to HERC's Form 10-KSB for the year ended
December 31, 1997.
(10)(14) Amendment to Stock Option Agreement by and between Gary S. Glatter and
HERC dated March 23, 1995 filed as Exhibit 10.24 to HERC's Form 10-KSB
for the year ended December 31, 1997.
(10)(15) Amendment Number two to Stock Option Agreement by and between Gary S.
Glatter and HERC dated February 1, 1997 filed as Exhibit 10.25 to
HERC's Form 10-KSB for the year ended December 31, 1997.
(21) Subsidiaries filed with HERC's Form 10-KSB for the year ended December
31, 1998.
(22)(1) Consent of Independent Certified Public Accountants (BDO Seidman, LLP)
filed with HERC's Form 10-KSB for the year ended December 31, 1998.
(23)(2) Consent of Independent Public Accountants (Arthur Andersen LLP) filed
with HERC's Form 10-KSB for the year ended December 31, 1998.
(27) Financial Data Schedule - Filed herewith
(99)(1) Risk Factors filed with HERC's Form 10-KSB for the year ended December
31, 1998.
(b) Reports on Form 8-K: Not Applicable.
3
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, H.E.R.C. Products Incorporated has duly caused this
amendment to the report on Form 10-KSB for the fiscal year ended December 31,
1998 to be signed on its behalf by the undersigned, thereunto duly authorized.
H.E.R.C. PRODUCTS INCORPORATED
By: /s/ S. Steven Carl
-----------------------
Dated: April 13, 1999 S. Steven Carl, President and
Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> DEC-31-1998
<EXCHANGE-RATE> 1
<CASH> 242,867
<SECURITIES> 0
<RECEIVABLES> 627,986
<ALLOWANCES> 11,630
<INVENTORY> 19,430
<CURRENT-ASSETS> 1,073,925
<PP&E> 958,736
<DEPRECIATION> 322,311
<TOTAL-ASSETS> 1,947,496
<CURRENT-LIABILITIES> 624,784
<BONDS> 0
0
0
<COMMON> 114,919
<OTHER-SE> 1,182,646
<TOTAL-LIABILITY-AND-EQUITY> 1,947,496
<SALES> 3,168,955
<TOTAL-REVENUES> 3,168,955
<CGS> 1,327,782
<TOTAL-COSTS> 3,325,694
<OTHER-EXPENSES> 288,865
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 85,760
<INCOME-PRETAX> (531,364)
<INCOME-TAX> 0
<INCOME-CONTINUING> (531,364)
<DISCONTINUED> 571,794
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 40,430
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>