|
|
|
|
|
|
|
|
|
|
|
|
|
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT NO. 1 TO
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 19, 1998
Fiberstars, Inc.
(Exact name of registrant as specified in charter)
- --------------------------------------------------------------------------------
California 0-24564 94-3021850
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
- --------------------------------------------------------------------------------
2883 Bayview Drive, Fremont, California 94538
(Address of principal executive offices) (Zip Code)
- --------------------------------------------------------------------------------
Registrant's telephone number, including area code (510) 490-0719
(Former name or former address, if changed since last report)
<PAGE>
The undersigned registrant hereby amends the following item of its
Current Report on Form 8-K filed on December 4, 1998 as set forth in the pages
attached thereto:
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired.
The consolidated financial statements of Crescent Lighting
required by Item 7(a) of Form 8-K, prepared pursuant to Rule
3-05 of Regulation S-X and filed in accordance with Item
7(a)(4), are attached hereto as Exhibit 99.2 and incorporated
herein by this reference.
(b) Pro Forma Financial Information.
The unaudited pro forma consolidated financial information
required by Item 7(b) of Form 8-K, prepared pursuant to
Article 11 of Regulation S-X and filed in accordance with Item
7(b)(2) of Form 8-K, are attached hereto as Exhibit 99.3 and
incorporated herein by this reference.
(c) Exhibits.
Exhibit No. Description
----------- -----------
2.1(1) Sale and Purchase Agreement dated as of November 19,
1998 by and among Fiberstars, Inc., Hillgate (4)
Limited, Crescent Lighting Limited, Michael Beverley
Morrison and Corinne Bertrand.
99.1(1) Press release issued November 24, 1998.
99.2 Financial Statements of Crescent Lighting Limited.
99.3 Pro Forma Financial Statements of Fiberstars, Inc.
(1) Filed with the Registrant's Report on Form 8-K filed on December 4,
1998.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FIBERSTARS, INC.
Date: February 2, 1999 By: /s/ Robert A. Connors
----------------------------------
Robert A. Connors
Vice President, Finance,
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
99.2 Financial Statements of Crescent Lighting Limited.
99.3 Pro Forma Financial Statements of Fiberstars, Inc.
REPORT OF THE DIRECTORS AND
FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
FOR
CRESCENT LIGHTING LIMITED
<PAGE>
CRESCENT LIGHTING LIMITED
INDEX TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
Page
Company Information 1
Report of the Directors 2
Report of the Auditors 3
Profit and Loss Account 4
Balance Sheet 5
Notes to the Financial Statements 6
Trading and Profit and Loss Account 11
<PAGE>
CRESCENT LIGHTING LIMITED
COMPANY INFORMATION
FOR THE YEAR ENDED 28 FEBRUARY 1998
DIRECTORS: M B Morrison
C B Bertrand
M Perman
B Barritt
SECRETARY: MB Morrison
REGISTERED OFFICE: Mountbarrow House
12 Elizabeth Street
London
SW1W 9RB
REGISTERED NUMBER: 2297342 (England and Wales)
AUDITORS: Wheawill & Sudworth
Chartered Accountants
& Registered Auditors
Mountbarrow House
12 Elizabeth Street
London
SW1W 9RB
Page 1
<PAGE>
CRESCENT LIGHTING LIMITED
REPORT OF THE DIRECTORS
FOR THE YEAR ENDED 28 FEBRUARY 1998
The directors present their report with the financial statements of the company
for the year ended 28 February 1998.
PRINCIPAL ACTIVITIES
The principal activities of the company in the year under review were those of
the sale of lighting, fixtures and fittings.
DIRECTORS
The directors during the year under review were:
M B Morrison
C B Bertrand
M Perman
B Barritt
The beneficial interests of the directors holding office on 28 February 1998 in
the issued share capital of the company were as follows:
28.2.98 1.3.97
Ordinary (pound)1 shares
M B Morrison 50 50
C B Bertrand 50 50
M Perman -- --
B Barritt -- --
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In preparing
those financial statements, the directors are required to
- - select suitable accounting policies and then apply them consistently;
- - make judgements and estimates that are reasonable and prudent;
- - prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. They are also responsible for safeguarding the assets of
the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
AUDITORS
The auditors, Wheawill & Sudworth, will be proposed for re-appointment in
accordance with Section 385 of the Companies Act 1985.
This report has been prepared in accordance with the special provisions of Part
VII of the Companies Act 1985 relating to small companies.
ON BEHALF OF THE BOARD:
/s/ MB Morrison
- --------------------------
MB Morrison - SECRETARY
Dated: 4th October 98
Page 2
<PAGE>
CRESCENT LIGHTING LIMITED
REPORT OF THE AUDITORS TO THE SHAREHOLDERS OF
CRESCENT LIGHTING LIMITED
We have audited the financial statements on pages four to ten which have been
prepared in accordance with the Financial Reporting Standard for Smaller
Entities, under the historical cost convention and the accounting policies set
out on page six.
Respective responsibilities of directors and auditors
As described on page two the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
Basis of opinion
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements. It
also includes an assessment of the significant estimates and judgements made by
the directors in the preparation of the financial statements, and of whether the
accounting policies are appropriate to the company's circumstances, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at 28 February 1998 and of its profit for the year
then ended and have been properly prepared in accordance with the Companies Act
1985.
/s/ Wheawill & Sudworth
Wheawill & Sudworth
Chartered Accountants
& Registered Auditors
Mountbarrow House
12 Elizabeth Street
London
SW1W 9RB Dated: 4th October 1998
Page 3
<PAGE>
<TABLE>
CRESCENT LIGHTING LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 28 FEBRUARY 1998
<CAPTION>
28.2.98 28.2.97
----------- ---------
Notes (pound) (pound)
<S> <C> <C> <C>
TURNOVER 2 2,416,096 1,760,942
Cost of sales 1,326,828 1,019,161
-------------- --------------
GROSS PROFIT 1,089,268 741,781
Administrative expenses 746,582 558,715
-------------- --------------
342,686 183,066
Other operating income -- 4
-------------- --------------
OPERATING PROFIT 3 342,686 183,070
Interest receivable and
similar income 4 8,110 2,175
-------------- --------------
350,796 185,245
Interest payable and
similar charges 1,295 2,436
-------------- --------------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 349,501 182,809
Tax on profit on ordinary
activities 5 82,985 44,877
-------------- --------------
PROFIT FOR THE FINANCIAL YEAR
AFTER TAXATION 266,516 137,932
Retained profit brought forward 280,484 142,552
-------------- --------------
RETAINED PROFIT CARRIED FORWARD (pound)547,000 (pound)280,484
============== ==============
<FN>
The notes form part of these financial statements
</FN>
</TABLE>
Page 4
<PAGE>
<TABLE>
CRESCENT LIGHTING LIMITED
BALANCE SHEET
28 FEBRUARY 1998
<CAPTION>
28.2.98 28.2.97
-------------------------- ---------------------------
Notes (pound) (pound) (pound) (pound)
<S> <C> <C> <C>
FIXED ASSETS:
Tangible assets 6 48,716 42,168
CURRENT ASSETS:
Stocks 228,123 112,830
Debtors 7 370,330 261,836
Cash at bank and in hand 311,825 166,970
------- -------
910,278 541,636
CREDITORS: Amounts falling
due within one year 8 411,894 297,223
------- -------
NET CURRENT ASSETS: 498,384 244,413
-------------- --------------
TOTAL ASSETS LESS CURRENT
LIABILITIES: 547,100 286,581
CREDITORS: Amounts falling
due after more than one year 9 -- 5,997
-------------- --------------
(pound)547,100 (pound)280,584
============== ==============
CAPITAL AND RESERVES:
Called up share capital 11 100 100
Profit and loss account 547,000 280,484
-------------- --------------
Shareholders' funds (pound)547,100 (pound)280,584
============== ==============
</TABLE>
These financial statements have been prepared in accordance with the special
provisions of Part VII of the Companies Act 1985 relating to small companies and
with the Financial Reporting Standard for Smaller Entities.
ON BEHALF OF THE BOARD:
/s/ MB Morrison
- ---------------------------
- DIRECTOR
Approved by the Board on 4th October 98.
The notes form part of these financial statements
Page 5
<PAGE>
CRESCENT LIGHTING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
1. ACCOUNTING POLICIES
Accounting convention
The financial statements have been prepared under the historical cost
convention and in accordance with the Financial Reporting Standard for
Smaller Entities.
Turnover
Turnover represents net invoiced sales of goods, excluding value added
tax.
Tangible fixed assets
Depreciation is provided at the following annual rates in order to write
off each asset over its estimated useful life.
Fixtures & fittings - 20% on cost
Tooling - 25% on cost
Office equipment - 20% on cost
Motor vehicles - 25% on cost
Computer equipment - 33% on cost
Stocks
Stock is valued at the lower of cost and net realisable value, after
making due allowance for obsolete and slow moving items.
Deferred taxation
Provision is made at current rates for taxation deferred in respect of
all material timing differences except to the extent that, in the opinion
of the directors, there is reasonable probability that the liability will
not arise in the foreseeable future.
Hire purchase and leasing commitments
Assets obtained under hire purchase contracts or finance leases are
capitalised in the balance sheet. Those held under hire purchase
contracts are depreciated over their estimated useful lives. Those held
under finance leases are depreciated over their estimated useful lives or
the lease term, whichever is the shorter.
The interest element of these obligations is charged to the profit and
loss account over the relevant period. The capital element of the future
payments is treated as a liability.
Rentals paid under operating leases are charged to the profit and loss
account as incurred.
Pensions
The company operates a defined contribution pension scheme. Contributions
payable for the year are charged in the profit and loss account.
2. TURNOVER
The turnover and profit before taxation are attributable to the principal
activities of the company.
Included in the turnover figure in the financial statements are exports,
which amounted to 58.3% (1997-52.6%) of turnover.
Page 6
<PAGE>
CRESCENT LIGHTING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
3. OPERATING PROFIT
<TABLE>
The operating profit is stated after charging/(crediting):
<CAPTION>
28.2.98 28.2.97
(pound) (pound)
<S> <C> <C>
Depreciation - owned assets 28,384 16,078
Depreciation - assets on hire purchase contracts - 4,524
(Profit)/Loss on disposal of fixed assets (108) 139
Auditors' remuneration 9,505 4,520
Pension costs 71,009 41,600
======= =======
Directors' emoluments and other benefits etc 196,132 154,978
======= =======
4. INTEREST RECEIVABLE AND SIMILAR INCOME
28.2.98 28.2.97
(pound) (pound)
Deposit account interest 8,110 2,175
======= =======
5. TAXATION
The tax charge on the profit on ordinary activities
for the year was as follows:
28.2.98 28.2.97
(pound) (pound)
UK Corporation Tax 82,444 44,877
Tax under/(over) provided in
previous years 541 --
------- -------
82,985 44,877
======= =======
<FN>
UK Corporation Tax has been charged at 24.15% (1997 - 24 .08%).
</FN>
</TABLE>
Page 7
<PAGE>
CRESCENT LIGHTING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
6. TANGIBLE FIXED ASSETS
Fixtures Office
& fittings Tooling equipment
---------- ------- ---------
(pound) (pound) (pound)
COST:
At 1 March 1997 4,769 4,980 10,686
Additions 3,872 -- 2,204
------- ------ -------
At 28 February 1998 8,641 4,980 12,890
------- ------ -------
DEPRECIATION:
At 1 March 1997 4,769 1,864 10,404
Charge for year 774 1,245 512
------- ------ -------
At 28 February 1998 5,543 3,109 10,916
------- ------ -------
NET BOOK VALUE:
At 28 February 1998 3,098 1,871 1,974
======= ====== =======
At 28 February 1997 -- 3,116 282
======= ====== =======
Motor Computer
vehicles equipment Totals
---------- --------- ---------
(pound) (pound) (pound)
COST:
At 1 March 1997 56,579 29,928 106,942
Additions 10,250 24,999 41,325
Disposals (12,782) -- (12,782)
------- ------ -------
At 28 February 1998 54,047 54,927 135,485
------- ------ -------
DEPRECIATION:
At 1 March 1997 24,137 23,601 64,775
Charge for year 12,658 13,195 28,384
Eliminated on disposals (6,390) -- (6,390)
------- ------ -------
At 28 February 1998 30,405 36,796 86,769
------- ------ -------
NET BOOK VALUE:
At 28 February 1998 23,642 18,131 48,716
======= ====== =======
At 28 February 1997 32,442 6,328 42,168
======= ====== =======
Page 8
<PAGE>
CRESCENT LIGHTING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
6. TANGIBLE FIXED ASSETS - continued
Fixed assets, included in the above, which are held under hire purchase
contracts are as follows:
Motor
vehicles
--------
(pound)
COST:
At 1 March 1997 18,098
Transferred to ownership (18,098)
-------
At 28 February 1998 --
-------
DEPRECIATION:
At 1 March 1997 13,572
Transferred to ownership (13,572)
-------
At 28 February 1998 --
-------
NET BOOK VALUE:
At 28 February 1998 --
=======
At 28 February 1997 4,526
=======
7. DEBTORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
28.2.98 28.2.97
(pound) (pound)
Trade debtors 344,404 246,486
Other debtors 21,981 13,144
Prepayments 3,945 2,206
------- -------
370,330 261,836
======= =======
8. CREDITORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
28.2.98 28.2.97
(pound) (pound)
Hire purchase contracts - 2,322
Trade creditors 244,748 161,932
Directors current accounts - 38,374
Other creditors - 19,121
Other tax and social security 9,019 7,625
Taxation 82,444 44,964
Accrued expenses 75,683 22,885
------- -------
411,894 297,223
======= =======
Page 9
<PAGE>
CRESCENT LIGHTING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 28 FEBRUARY 1998
<TABLE>
9. CREDITORS: AMOUNTS FALLING
DUE AFTER MORE THAN ONE YEAR
<CAPTION>
28.2.98 28.2.97
(pound) (pound)
<S> <C> <C>
Hire purchase contracts -- 5,997
======= =======
10. OPERATING LEASE COMMITMENTS
The following payments are committed to be paid within one year:
28.2.98 28.2.97
(pound) (pound)
Expiring:
Between one and five years -- 748
======= =======
11. CALLED UP SHARE CAPITAL
Authorised, allotted, issued and fully paid:
Number: Class: Nominal 28.2.98 28.2.97
value: (pound) (pound)
100 Ordinary (pound)1 100 100
======= =======
</TABLE>
12. PENSION COMMITMENTS
The company operates a defined contribution pension scheme on behalf of
its directors and certain employees. The assets of the scheme are held
separately from those of the company in an independently administered
fund. Contributions are paid based upon the recommendation of a qualified
actuary. The annual commitment under this scheme is for contributions of
(pound)71,009 (1997: (pound)41,600).
Page 10
<PAGE>
<TABLE>
CRESCENT LIGHTING LIMITED
TRADING AND PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 28 FEBRUARY 1998
<CAPTION>
28.2.98 28.2.97
------------------------- ------------------------
(pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C>
Income:
Turnover 2,390,619 1,705,091
Commission received 25,477 55,851
--------- 2,416,096 --------- 1,760,942
Cost of sales:
Opening stock 107,002 124,641
Purchases 1,434,196 1,000,133
Royalty payments 13,753 1,389
--------- ---------
1,554,951 1,126,163
Closing stock (228,123) (107,002)
--------- 1,326,828 --------- 1,019,161
--------- ---------
GROSS PROFIT 1,089,268 741,781
Other income:
Discounts received -- 4
Deposit account interest 8,110 2,175
--------- 8,110 --------- 2,179
--------- ---------
1,097,378 743,960
Expenditure:
Directors' remuneration 196,132 154,978
Social security 19,578 15,747
Pension contributions 71,009 41,600
Wages 162,214 98,176
Social security 14,751 15,786
Printing & stationery 7,515 6,917
Telephone, telex & fax 9,790 9,931
Postage & carriage 5,556 4,661
Motor expenses 12,928 12,245
Other operating leases -- 748
Hire of equipment 187 --
Repairs and renewals 1,794 2,524
Sundry expenses 8,366 5,677
Audit & accountancy 9,505 4,520
Consultancy fees -- 6,750
Professional fees & insurance 355 2,470
Subsistence 7,140 3,952
Computer costs 793 --
Travel & entertainment 16,471 14,393
Commission paid 20,397 24,151
Advertising & publicity 42,162 13,032
Bad debts 4,094 83
Design & development work 4,752 1,256
Discounts allowed 8,636 4,340
Freight & insurance 46,210 35,673
--------- --------- ---------- ---------
Carried forward 670,335 1,097,378 479,610 743,960
<FN>
This page does not form part of the statutory financial statements
</FN>
</TABLE>
Page 11
<PAGE>
<TABLE>
CRESCENT LIGHTING LIMITED
TRADING AND PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 28 FEBRUARY 1998
<CAPTION>
28.2.98 28.2.97
------------------------- ------------------------
(pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C>
Brought forward 670,335 1,097,378 479,610 743,960
Subscriptions & donations 358 174
Rent & rates 29,481 28,479
Insurance 11,423 22,508
Light and heat 1,714 1,604
--------- 713,311 --------- 532,375
--------- ---------
384,067 211,585
Finance costs:
Hire purchase 1,295 2,436
Bank charges 2,014 2,120
Miscellaneous charges 2,981 3,479
--------- 6,290 --------- 8,035
--------- ---------
377,777 203,550
Depreciation:
Fixtures & fittings 774
Tooling 1,245 1,245
Office equipment 512 1,437
Motor vehicles 12,658 11,894
Computer equipment 13,195 6,026
--------- 28,384 --------- 20,602
--------- ---------
349,393 182,948
Profit/(Loss) on disposal of fixed assets:
Motor vehicles 108 (139)
-------------- --------------
NET PROFIT (pound)349,501 (pound)182,809
============== ==============
<FN>
This page does not form part of the statutory financial statements
</FN>
</TABLE>
Page 12
<PAGE>
Report of the Directors and
Financial Statements
for the Year Ended 28 February 1997
for
Crescent Lighting Limited
<PAGE>
Crescent Lighting Limited
Index to the Financial Statements
for the Year Ended 28 February 1997
Page
Company Information 1
Report of the Directors 2
Report of the Auditors 3
Profit and Loss Account 4
Balance Sheet 5
Notes to the Financial Statements 6
Trading and Profit and Loss Account 12
<PAGE>
Crescent Lighting Limited
Company Information
for the Year Ended 28 February 1997
DIRECTORS: M B Morrison
C B Bertrand
M Perinan
B Barritt
SECRETARY: MB Morrison
REGISTERED OFFICE: Mountbarrow House
12 Elizabeth Street
London
SW1W 9RB
REGISTERED NUMBER: 2297342 (England and Wales)
AUDITORS: Wheawill & Sudworth
Chartered Accountants
& Registered Auditors
Caversham House
4 Gosbrook Road
Caversham
Reading RG4 8BS
Page 1
<PAGE>
Crescent Lighting Limited
Report of the Directors
for the Year Ended 28 February 1997
The directors present their report with the financial statements of the company
for the year ended 28 February 1997.
PRINCIPAL ACTIVITIES
The principal activities of the company in the year under review were those of
the sale of lighting, fixtures and fittings.
DIRECTORS
The directors during the year under review were:
M B Morrison
C B Bertrand
M Perman
B Barritt
The beneficial interests of the directors holding office on 28 February 1997 in
the issued share capital of the company were as follows:
28.2.97 1.3.96
Ordinary (pound)1 shares
M B Morrison 50 50
C B Bertrand 50 50
M Perman
B Barritt
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In preparing
those financial statements, the directors are required to
- - select suitable accounting policies and then apply them consistently;
- - make judgments and estimates that are reasonable and prudent;
- - prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. They are also responsible for safeguarding the assets of
the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
AUDITORS
The auditors, Wheawill & Sudworth, will be proposed for re-appointment in
accordance with Section 385 of the Companies Act 1985.
This report has been prepared in accordance with the special provisions of Part
VII of the Companies Act 1985 relating to small companies.
ON BEHALF OF THE BOARD:
/s/ MB Morrison
- -----------------------
MB Morrison - SECRETARY
Dated: July 21, 1997
Page 2
<PAGE>
Crescent Lighting Limited
Report of the Auditors to the Shareholders of
Crescent Lighting Limited
We have audited the financial statements on pages four to eleven which have been
prepared under the historical cost convention and the accounting policies set
out on page six.
Respective responsibilities of directors and auditors
As described on page two the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
Basis of opinion
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements. It
also includes an assessment of the significant estimates and judgments made by
the directors in the preparation of the financial statements, and of whether the
accounting policies are appropriate to the company's circumstances, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at 28 February 1997 and of its profit for the year
then ended and have been properly prepared in accordance with the provisions of
the Companies Act 1985 applicable to small companies.
Wheawill & Sudworth
Chartered Accountants
& Registered Auditors
Caversham House
4 Gosbrook Road
Caversham
Reading RG4 8BS Dated: August 5, 1997
Page 3
<PAGE>
Crescent Lighting Limited
<TABLE>
Profit and Loss Account
for the Year Ended 28 February 1997
<CAPTION>
28.2.97 29.2.96
--------- ---------
Notes (pound) (pound)
<S> <C> <C> <C>
TURNOVER 2 1,760,942 1,859,610
Cost of sales 1,019,161 1,162,861
--------- ---------
GROSS PROFIT 741,781 696,749
Administrative expenses 558,715 519,796
--------- ---------
183,066 176,953
Other operating income 4 94
--------- ---------
OPERATING PROFIT 4 183,070 177,047
Interest receivable and
similar income 5 2,175 571
--------- ---------
185,245 177,618
Interest payable and
similar charges 2,436 3,193
--------- ---------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 182,809 174,425
Tax on profit on ordinary
activities 6 44,877 46,864
--------- ---------
PROFIT FOR THE FINANCIAL YEAR
AFTER TAXATION 137,932 127,561
Retained profit brought forward 142,552 14,991
--------- ---------
RETAINED PROFIT CARRIED FORWARD (pound)280,484 (pound)142,552
========= =========
</TABLE>
CONTINUING OPERATIONS
None of the company's activities were acquired or discontinued during the
current and previous years.
TOTAL RECOGNISED GAINS AND LOSSES
The company has no recognised gains or losses other than the profits for the
current and previous years.
The notes form part of these financial statements
Page 4
<PAGE>
Crescent Lighting Limited
<TABLE>
Balance Sheet
28 February 1997
<CAPTION>
28.2.97 29.2.96
---------------------- ----------------------
Notes (pound) (pound) (pound) (pound)
FIXED ASSETS:
<S> <C> <C> <C>
Tangible assets 8 42,168 35,204
CURRENT ASSETS:
Stocks 9 112,830 114,172
Debtors 10 261,836 334,923
Cash at bank and in hand 166,970 112,686
------- -------
541,636 561,781
CREDITORS: Amounts falling
due within one year 11 297,223 446,014
------- -------
NET CURRENT ASSETS: 244,413 115,767
-------- --------
TOTAL ASSETS LESS CURRENT
LIABILITIES: 286,581 150,971
CREDITORS: Amounts falling
due after more than one year 12 5,997 8,319
-------- --------
(pound)280,584 (pound)142,652
-------- --------
CAPITAL AND RESERVES:
Called up share capital 14 100 100
Profit and loss account 280,484 142,552
-------- --------
Shareholders' funds 16 (pound)280,584 (pound)142,652
======== ========
</TABLE>
These financial statements have been prepared in accordance with the special
provisions of Part VII of the Companies Act 1985 relating to small companies.
ON BEHALF OF THE BOARD:
- -----------------------
M B Morrison - DIRECTOR
Approved by the Board on July 21, 1997
----------------------
The notes form part of these financial statements
Page 5
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 28 February 1997
1. ACCOUNTING POLICIES
Accounting convention
The financial statements have been prepared under the historical cost
convention.
Financial Reporting Standard Number 1
Exemption has been taken from preparing a cash flow statement on the
grounds that the company qualifies as a small company.
Turnover
Turnover represents net invoiced sales of goods, excluding value added tax.
Tangible fixed assets
Depreciation is provided at the following annual rates in order to write
off each asset over its estimated useful life or, if held under a finance
lease, over the lease term, whichever is the shorter.
Fixtures & fittings - 20% on cost
Tooling - 25% on cost
Office equipment - 20% on cost
Motor vehicles - 25% on cost
Computer equipment - 33 % on cost
Stocks
Stock is valued at the lower of cost and net realisable value, after making
due allowance for obsolete and slow moving items.
Deferred taxation
Provision is made at current rates for taxation deferred in respect of all
material timing differences except to the extent that, in the opinion of
the directors, there is reasonable probability that the liability will not
arise in the foreseeable future.
Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling
at the rates of exchange ruling at the balance sheet date. Transactions in
foreign currencies are translated into sterling at the rate of exchange
ruling at the date of transaction. Exchange differences are taken into
account in arriving at the operating result.
Hire purchase and leasing commitments
Assets obtained under hire purchase contracts or finance leases are
capitalised in the balance sheet. Those held under hire purchase contracts
are depreciated over their estimated useful lives. Those held under finance
leases are depreciated over their estimated useful lives or the lease term,
whichever is the shorter.
The interest element of these obligations is charged to the profit and loss
account over the relevant period. The capital element of the future
payments is treated as a liability.
Rentals paid under operating leases are charged to the profit and loss
account as incurred.
Pensions
The company operates a defined contribution pension scheme. Contributions
payable for the year are charged in the profit and loss account.
2. TURNOVER
The turnover and profit before taxation are attributable to the principal
activities of the company.
Included in the turnover figure in the financial statements are exports,
which amounted to 52.6% (1996-44.9%) of turnover.
Page 6
<PAGE>
Crescent Lighting Limited
<TABLE>
Notes to the Financial Statements
for the Year Ended 28 February 1997
3. STAFF COSTS
<CAPTION>
28.2.97 29.2.96
(pound) (pound)
<S> <C> <C>
Pension costs (other than social security costs) 41,600 52,410
======= =======
4. OPERATING PROFIT
The operating profit is stated after charging/(crediting):
28.2.97 29.2.96
(pound) (pound)
Other operating leases 748 748
Depreciation - owned assets 16,078 12,818
Depreciation - assets on hire purchase contracts 4,524 4,524
Loss/(Profit) on disposal of fixed assets 139 (429)
Auditors' remuneration 4,520 5,825
======= =======
Directors' emoluments 196,575 204,032
======= =======
5. INTEREST RECEIVABLE AND SIMILAR INCOME
28.2.97 29.2.96
(pound) (pound)
======= =======
Deposit account interest 2,175 571
6. INTEREST PAYABLE AND SIMILAR CHARGES
28.2.97 29.2.96
(pound) (pound)
Hire purchase 2,436 1,757
======= =======
7. TAXATION
The tax charge on the profit on ordinary activities for
the year was as follows:
28.2.97 29.2.96
(pound) (pound)
UK Corporation Tax 44,877 46,864
======= =======
UK Corporation Tax has been charged at 24.08% (1996 -25%).
</TABLE>
Page 7
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 28 February 1997
<TABLE>
8. TANGIBLE FIXED ASSETS
<CAPTION>
Fixtures Office
& fittings Tooling equipment
---------- ------- ---------
(pound) (pound) (pound)
<S> <C> <C> <C>
COST:
At 1 March 1996 4,769 1,875 10,333
Additions - 3,105 353
------ ------ -------
At 28 February 1997 4,769 4,980 10,686
------ ------ -------
DEPRECIATION:
At 1 March 1996 4,769 619 8,967
Charge for year - 1,245 1,437
------ ------ -------
At 28 February 1997 4,769 1,864 10,404
NET BOOK VALUE:
At 28 February 1997 - 3,116 282
====== ====== =======
At 29 February 1996 - 1,256 1,366
====== ====== =======
Motor Computer
vehicles equipment Totals
-------- --------- --------
(pound) (pound) (pound)
COST:
At 1 March 1996 38,666 25,681 81,324
Additions 25,699 4,248 33,405
Disposals (7,786) - (7,786)
------ ------ -------
At 28 February 1997 56,579 29,929 106,943
------ ------ -------
DEPRECIATION:
At 1 March 1996 14,190 17,575 46,120
Charge for year 11,894 6,026 20,602
Eliminated on disposals (1,947) - (1,947)
------ ------ -------
At 28 February 1997 24,137 23,601 64,775
------ ------ -------
NET BOOK VALUE:
At 28 February 1997 32,442 6,328 42,168
====== ====== =======
At 29 February 1996 24,476 8,106 35,204
====== ====== =======
</TABLE>
Page 8
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 28 February 1997
8. TANGIBLE FIXED ASSETS - continued
<TABLE>
Fixed assets, included in the above, which are held under hire purchase
contracts are as follows:
<CAPTION>
Office Motor
equipment vehicles Totals
--------- -------- --------
(pound) (pound) (pound)
<S> <C> <C> <C>
COST:
At 1 March 1996 4,086 18,098 22,184
Transferred to ownership (4,086) - (4,086)
------ ------- -------
At 28 February 1997 - 18,098 18,098
------ ------- -------
DEPRECIATION:
At 1 March 1996 3,271 9,048 12,319
Charge for year - 4,524 4,524
Transferred to ownership (3,271) - (3,271)
------ ------- -------
At 28 February 1997 - 13,572 13,572
------ ------- -------
NET BOOK VALUE:
At 28 February 1997 - 4,526 4,526
====== ======= =======
At 29 February 1996 815 9,050 9,865
====== ======= =======
9. STOCKS
28.2.97 29.2.96
(pound) (pound)
Stock 112,830 114,172
======= =======
10. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
28.2.97 29.2.96
(pound) (pound)
Trade debtors 246,486 298,154
Other debtors 13,144 33,721
Prepayments 2,206 3,048
------- -------
261,836 334,923
======= =======
</TABLE>
Page 9
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 28 February 1997
<TABLE>
11. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
<CAPTION>
28.2.97 29.2.96
(pound) (pound)
<S> <C> <C>
Hire purchase contracts (see note 13) 2,322 2,478
Trade creditors 161,932 274,380
Directors current accounts 38,374 26,977
Other creditors 19,121 -
Social security & other taxes 7,625 5,985
Taxation 44,964 44,970
Accrued expenses 22,885 91,224
------- -------
297,223 446,014
======= =======
12. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
28.2.97 29.2.96
(pound) (pound)
Hire purchase contracts
(see note 13) 5,997 8,319
======= =======
13. OBLIGATIONS UNDER HIRE PURCHASE CONTRACTS AND LEASES
Hire
purchase
contracts
28.2.97 29.2.96
(pound) (pound)
Gross obligations repayable:
Within one year 3,707 3,999
Between one and five years 9,576 9,589
------- -------
13,283 13,588
------- -------
Finance charges repayable:
Within one year 1,385 1,521
Between one and five years 3,579 1,270
------- -------
4,964 2,791
------- -------
Net obligations repayable:
Within one year 2,322 2,478
Between one and five years 5,997 8,319
------- -------
8,319 10,797
======= =======
</TABLE>
Page 10
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 28 February 1997
<TABLE>
13. OBLIGATIONS UNDER HIRE PURCHASE CONTRACTS AND LEASES - continued
The following payments are committed to be paid within one year:
<CAPTION>
Operating
leases
28.2.97 29.2.96
(pound) (pound)
Expiring:
<S> <C> <C>
Between one and five years 748 748
=== ===
4. CALLED UP SHARE CAPITAL
Authorised, allotted, issued and fully paid:
Number: Class: Nominal 28.2.97 29.2.96
value: (pound) (pound)
100 Ordinary (pound)1 100 100
=== ===
</TABLE>
15. PENSION COMMITMENTS
The company operates a defined contribution pension scheme on behalf of
its directors and certain employees. The assets of the scheme are held
separately from those of the company in an independently administered
fund. Contributions are paid based upon the recommendation of a qualified
actuary. The annual commitment under this scheme is for contributions of
(pound)41,600 (1996: (pound)52,410).
<TABLE>
16. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
<CAPTION>
28.2.97 29.2.96
(pound) (pound)
<S> <C> <C>
Profit for the financial year 137,932 127,561
------- -------
NET ADDITION TO SHAREHOLDERS' FUNDS 137,932 127,561
Opening shareholders' funds 142,652 15,091
------- -------
CLOSING SHAREHOLDERS' FUNDS 280,584 142,652
======= =======
Equity interests 280,584 142,652
======= =======
</TABLE>
Page 11
<PAGE>
<TABLE>
Crescent Lighting Limited
Trading and Profit and Loss Account
for the Year Ended 28 February 1997
<CAPTION>
28.2.97 29.2.96
------------------------ ------------------------
(pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C>
Income:
Turnover 1,705,091 1,859,610
Commission received 55,851 -
--------- ---------
1,760,942 1,859,610
Cost of sales:
Opening stock 124,641 66,786
Purchases 1,000,133 1,204,932
Sub-contractors 1,389 15,784
--------- ---------
1,126,163 1,287,502
Closing stock (107,002) (124,641)
--------- ---------
1,019,161 1,162,861
--------- ---------
GROSS PROFIT 741,781 696,749
Other income:
Discounts received 4 94
Deposit account interest 2,175 571
--------- ---------
2,179 665
--------- ---------
743,960 697,414
Expenditure:
Directors' remuneration 154,978 151,622
Social security 15,747 15,498
Pension contributions 41,600 52,410
Wages 98,176 69,640
Social security 15,786 5,910
Printing & stationery 6,917 6,413
Telephone, telex & fax 9,931 11,244
Postage & carriage 4,661 4,235
Motor expenses 12,245 14,343
Other operating leases 748 748
Repairs & renewals 2,524 6,971
Sundry expenses 5,677 6,011
Audit & accountancy 4,520 5,825
Consultancy fees 6,750
Professional fees & insurance 2,470 11,725
Subsistence 3,952 3,083
Travel & entertainment 14,393 10,736
Commission paid 24,151 54,039
Advertising & publicity 13,032 30,541
Bad debts 83 585
Design & development work 1,256 3,055
Discounts allowed 4,340 5,291
Freight & insurance 35,673 41,251
Exchange difference - (40,439)
Subscriptions & donations 174 328
------- ------- ------- -------
Carried forward 479,784 743,960 471,065 697,414
<FN>
This page does not form part of the statutory financial statements
</FN>
</TABLE>
Page l2
<PAGE>
<TABLE>
Crescent Lighting Limited
Trading and Profit and Loss Account
for the Year Ended 28 February 1997
<CAPTION>
28.2.97 29.2.96
---------------------- ----------------------
(pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C>
Brought forward 479,784 743,960 471,065 697,414
Rent & rates 28,479 28,951
Insurance 22,508 -
Light & heat 1,604 1,427
------- -------
532,375 501,443
------- -------
211,585 195,971
Finance costs:
Bank interest - 192
Other interest - 1,166
Interest on late taxation - 78
Hire purchase 2,436 1,757
Bank charges 2,120 1,440
Miscellaneous charges 3,479 -
------- -------
8,035 4,633
------- -------
203,550 191,338
Depreciation:
Fixtures & fittings - 637
Tooling 1,245 469
Office equipment 1,437 1,367
Motor vehicles 11,894 9,666
Computer equipment 6,026 5,203
------- -------
20,602 17,342
------- -------
182,948 173,996
(Loss)/Profit on disposal of fixed assets:
Motor vehicles (139) 429
------- -------
NET PROFIT (pound)182,809 (pound)174,425
======= =======
<FN>
This page does not form part of the statutory financial statements
</FN>
</TABLE>
Page 13
<PAGE>
Report of the Directors and
Financial Statements
for the Year Ended 29 February 1996 for
Crescent Lighting Limited
<PAGE>
Crescent Lighting Limited
Index to the Financial Statements
for the Year Ended 29 February 1996
Page
Company Information 1
Report of the Directors 2
Report of the Auditors 3
Profit and Loss Account 4
Balance Sheet 5
Notes to the Financial Statements 6
Trading and Profit and Loss Account 12
<PAGE>
Crescent Lighting Limited
Company Information
for the Year Ended 29 February 1996
DIRECTORS: M B Morrison
C B Bertrand
M Perman
B Barritt
SECRETARY: MB Morrison
REGISTERED OFFICE: Mountbarrow House
12 Elizabeth Street
London
SW1W 9RB
REGISTERED NUMBER: 2297342 (England and Wales)
AUDITORS: Wheawill & Sudworth
Chartered Accountants
& Registered Auditors
Caversham House
4 Gosbrook Road
Caversham
Reading RG4 8BS
<PAGE>
Crescent Lighting Limited
Report of the Directors
for the Year Ended 29 February 1996
The directors present their report with the financial statements of the company
for the year ended 29 February 1996.
PRINCIPAL ACTIVITIES
The principal activities of the company in the year under review were those of
the sale of lighting, fixtures and fittings.
DIRECTORS
The directors during the year under review were:
M B Morrison
C B Bertrand
M Perman
B Barritt
The beneficial interests of the directors holding office on 29 February 1996 in
the issued share capital of the company were as follows:
29.2.96 1.3.95
Ordinary (pound)1 shares
MB Morrison 50 50
C B Bertrand 50 50
M Perman -- --
B Barritt -- --
STATEMENT OF DIRECTORS' RESPONSIBILITIES
Company law requires the directors to prepare financial statements for each
financial year which give a true and fair view of the state of affairs of the
company and of the profit or loss of the company for that period. In preparing
those financial statements, the directors are required to
- - select suitable accounting policies and then apply them consistently;
- - make judgments and estimates that are reasonable and prudent;
- - prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the company will continue in business.
The directors are responsible for keeping proper accounting records which
disclose with reasonable accuracy at any time the financial position of the
company and to enable them to ensure that the financial statements comply with
the Companies Act 1985. They are also responsible for safeguarding the assets of
the company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
AUDITORS
The auditors, Wheawill & Sudworth, will be proposed for re-appointment in
accordance with Section 385 of the Companies Act 1985.
In preparing this report, the directors have taken advantage of special
exemptions applicable to small companies conferred by Part II of Schedule 8 to
the Companies Act 1985.
ON BEHALF OF THE BOARD:
MB Morrison - SECRETARY
/s/ MB Morrison
-------------------------
Dated: September 2, 1996
------------------------
<PAGE>
Crescent Lighting Limited
Report of the Auditors to the Shareholders of
Crescent Lighting Limited
We have audited the financial statements on pages four to eleven which have been
prepared under the historical cost convention and the accounting policies set
out on page six.
Respective responsibilities of directors and auditors
As described on page two the company's directors are responsible for the
preparation of financial statements. It is our responsibility to form an
independent opinion, based on our audit, on those statements and to report our
opinion to you.
Basis of opinion
We conducted our audit in accordance with Auditing Standards issued by the
Auditing Practices Board. An audit includes examination, on a test basis, of
evidence relevant to the amounts and disclosures in the financial statements. It
also includes an assessment of the significant estimates and judgments made by
the directors in the preparation of the financial statements, and of whether the
accounting policies are appropriate to the company's circumstances, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and
explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements
are free from material misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state
of the company's affairs as at 29 February 1996 and of its profit for the year
then ended and have been properly prepared in accordance with the provisions of
the Companies Act 1985 applicable to small companies.
/s/ Wheawill & Sudworth
- -----------------------------
Wheawill & Sudworth
Chartered Accountants
& Registered Auditors
Caversham House
4 Gosbrook Road
Caversham
Reading RG4 8BS Dated: 6th September 1996
------------------------------
<PAGE>
<TABLE>
Crescent Lighting Limited
Profit and Loss Account
for the Year Ended 29 February 1996
<CAPTION>
29.2.96 28.2.95
--------- ---------
Notes (pound) (pound)
<S> <C> <C> <C>
TURNOVER 2 1,859,610 863,047
Cost of sales 1,162,861 509,809
--------- ---------
GROSS PROFIT 696,749 353,238
Administrative expenses 519,796 331,643
--------- ---------
176,953 21,595
Other operating income 94 3,053
--------- ---------
OPERATING PROFIT 3 177,047 24,648
Interest receivable and similar income 4 571 --
--------- ---------
177,618 24,648
Interest payable and similar charges 3,193 6,314
--------- ---------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 174,425 18,334
Tax on profit on ordinary activities 46,864 5,620
--------- ---------
PROFIT FOR THE FINANCIAL YEAR AFTER TAXATION 127,561 12,714
Retained profit brought forward 14,991 2,277
--------- ---------
RETAINED PROFIT CARRIED FORWARD (pound)142,552 (pound) 14,991
========= =========
</TABLE>
CONTINUING OPERATIONS
None of the company's activities were acquired or discontinued during the
current and previous years.
TOTAL RECOGNISED GAINS AND LOSSES
The company has no recognised gains or losses other than the profits for the
current and previous years.
The notes form part of these financial statements
<PAGE>
<TABLE>
Crescent Lighting Limited
Balance Sheet
29 February 1996
<CAPTION>
29.2.96 28.2.95
-------------------------- --------------------------
Notes (pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C> <C>
FIXED ASSETS:
Tangible assets 5 35,204 25,988
CURRENT ASSETS:
Stocks 6 114,172 66,786
Debtors 7 334,923 135,629
Cash at bank and in hand 112,686 36,295
------- -------
561,781 238,710
CREDITORS: Amounts falling due
within one year 8 446,014 226,811
------- -------
NET CURRENT ASSETS: 115,767 11,899
------- ------
TOTAL ASSETS LESS CURRENT LIABILITIES: 150,971 37,887
CREDITORS: Amounts falling
due after more than one year 9 8,319 22,796
------- ------
(pound)142,652 (pound) 15,091
======= ======
CAPITAL AND RESERVES:
Called up share capital 11 100 100
Profit and loss account 142,552 14,991
------- ------
Shareholders' funds 13 (pound)142,652 (pound) 15,091
======= ======
</TABLE>
In preparing these financial statements, the directors have taken advantage of
special exemptions applicable to small companies conferred by Part I of Schedule
8 to the Companies Act 1985. The directors have done so on the grounds that, in
their opinion, the company is entitled to the benefit of those exemptions
because it meets the qualifying conditions for small companies as stated in
Section 247 of the Companies Act 1985.
ON BEHALF OF THE BOARD:
MB Morrison - DIRECTOR /s/ MB Morrison
-------------------------
Approved by the Board on 2/9/96
-------
The notes form part of these financial statements
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 29 February 1996
1. ACCOUNTING POLICIES
Accounting convention
The financial statements have been prepared under the historical cost
convention.
Financial Reporting Standard Number 1
Exemption has been taken from preparing a cash flow statement on the
grounds that the company qualifies as a small company.
Turnover
Turnover represents net invoiced sales of goods, excluding value added tax.
Tangible fixed assets
Depreciation is provided at the following annual rates in order to write
off each asset over its estimated useful life or, if held under a finance
lease, over the lease term, whichever is the shorter.
Fixtures & fittings - 20% on cost
Tooling - 25% on cost
Office equipment - 20% on cost
Motor vehicles - 25% on cost
Computer equipment - 33% on cost
Stocks
Stock is valued at the lower of cost and net realisable value, after making
due allowance for obsolete and slow moving items.
Deferred taxation
Provision is made at current rates for taxation deferred in respect of all
material timing differences except to the extent that, in the opinion of
the directors, there is reasonable probability that the liability will not
arise in the foreseeable future.
Hire purchase and leasing commitments
Assets obtained under hire purchase contracts or finance leases are
capitalised in the balance sheet. Those held under hire purchase contracts
are depreciated over their estimated useful lives. Those held under finance
leases are depreciated over their estimated useful lives or the lease term,
whichever is the shorter.
The interest element of these obligations is charged to the profit and loss
account over the relevant period. The capital element of the future
payments is treated as a liability.
Rentals paid under operating leases are charged to the profit and loss
account as incurred.
Pensions
The company operates a defined contribution pension scheme. Contributions
payable for the year are charged in the profit and loss account.
2. TURNOVER
The turnover and profit before taxation are attributable to the principal
activities of the company.
Included in the turnover figure in the financial statements are exports,
which amounted to 44.9% (1995-32.3%) of turnover.
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 29 February 1996
3. OPERATING PROFIT
The operating profit is stated after charging/(crediting):
29.2.96 28.2.95
(pound) (pound)
Other operating leases 748 878
Depreciation - owned assets 17,342 5,577
Depreciation - assets on hire purchase
or finance leases -- 5,341
Profit on disposal of fixed assets (429) (699)
Auditors' remuneration 5,825 3,075
======= =======
Directors' emoluments 204,032 128,478
======= =======
4. INTEREST RECEIVABLE AND SIMILAR INCOME
29.2.96 28.2.95
(pound) (pound)
Deposit account interest 571 --
======= =======
5. TANGIBLE FIXED ASSETS
Fixtures Office
& fittings Tooling equipment
---------- ------- ---------
(pound) (pound) (pound)
COST:
At 1 March 1995 4,769 600 10,333
Additions -- 1,275 --
------ ------ ------
At 29 February 1996 4,769 1,875 10,333
------ ------ ------
DEPRECIATION:
At 1 March 1995 4,132 150 7,600
Charge for year 637 469 1,367
------ ------ ------
At 29 February 1996 4,769 619 8,967
------ ------ ------
NET BOOK VALUE:
At 29 February 1996 -- 1,256 1,366
====== ====== ======
At 28 February 1995 637 450 2,733
====== ====== ======
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 29 February 1996
Motor Computer
vehicles equipment Totals
-------- --------- -------
(pound) (pound) (pound)
COST:
At 1 March 1995 25,793 15,194 56,689
Additions 20,568 10,486 32,329
Disposals (7,695) -- (7,695)
------- ------- -------
At 29 February 1996 38,666 25,680 81,323
------- ------- -------
DEPRECIATION:
At 1 March 1995 6,448 12,371 30,701
Charge for year 9,666 5,203 17,342
Eliminated on disposals (1,924) -- (1,924)
------- ------- -------
At 29 February 1996 14,190 17,574 46,119
------- ------- -------
NET BOOK VALUE:
At 29 February 1996 24,476 8,106 35,204
======= ======= =======
At 28 February 1995 19,345 2,823 25,988
======= ======= =======
Fixed assets, included in the above, which are held under hire purchase or
finance leases are as follows:
Office Motor
equipment vehicles Totals
--------- --------- -------
(pound) (pound) (pound)
COST:
At 1 March 1995
and 29 February 1996 4,086 18,098 22,184
------- ------- -------
DEPRECIATION:
At 1 March 1995
and 29 February 1996 3,271 4,524 7,795
------- ------- -------
NET BOOK VALUE:
At 29 February 1996 815 13,574 14,389
======= ======= =======
At 28 February 1995 815 13,574 14,389
======= ======= =======
6. STOCKS
29.2.96 28.2.95
(pound) (pound)
Stock 114,172 66,786
======= =======
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 29 February 1996
7. DEBTORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
29.2.96 28.2.95
(pound) (pound)
Trade debtors 298,154 131,106
Other debtors 33,721 1,000
Prepayments 3,048 3,523
------- -------
334,923 135,629
======= =======
8. CREDITORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
29.2.96 28.2.95
(pound) (pound)
Hire purchase and finance leases
(see note 10) 2,478 2,944
Trade creditors 274,380 129,844
Directors current accounts 26,977 52,977
Social security & other taxes 5,985 3,243
Taxation 44,970 5,620
Accrued expenses 91,224 32,183
------- -------
446,014 226,811
======= =======
9. CREDITORS: AMOUNTS FALLING
DUE AFTER MORE THAN ONE YEAR
29.2.96 28.2.95
(pound) (pound)
Directors loan -- 12,000
Hire purchase and finance leases
(see note 10) 8,319 10,796
------- -------
8,319 22,796
======= =======
Page 9
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 29 February 1996
10. OBLIGATIONS UNDER HIRE PURCHASE CONTRACTS AND LEASES
Hire
purchase
contracts
29.2.96 28.2.95
(pound) (pound)
Cross obligations repayable:
Within one year 3,999 4,701
Between one and five years 9,589 13,569
------ ------
13,588 18,270
------ ------
Finance charges repayable:
Within one year 1,521 1,757
Between one and five years 1,270 2,773
------ ------
2,791 4,530
------ ------
Net obligations repayable:
Within one year 2,478 2,944
Between one and five years 8,319 10,796
------ ------
10,797 13,740
====== ======
The following payments are committed to be paid within one year:
Operating
leases
29.2.96 28.2.95
(pound) (pound)
Expiring:
Between one and five years 748 748
====== ======
11. CALLED UP SHARE CAPITAL
Authorised, allotted, issued and fully paid:
Number: Class: Nominal 29.2.96 28.2.95
value: (pound) (pound)
100 Ordinary (pound)1 100 100
====== ======
12. PENSION COMMITMENTS
The company operates a defined contribution pension scheme on behalf of its
directors and certain employees. The assets of the scheme are held
separately from those of the company in an independently administered fund.
Contributions are paid based upon the recommendation of a qualified
actuary. The annual commitment under this scheme is for contributions of
(pound)52,410 (1995: (pound)12,400).
<PAGE>
Crescent Lighting Limited
Notes to the Financial Statements
for the Year Ended 29 February 1996
13. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
29.2.96 28.2.95
(pound) (pound)
Profit for the financial year 127,561 12,714
------- -------
NET ADDITION TO SHAREHOLDERS' FUNDS 127,561 12,714
Opening shareholders' funds 15,091 2,377
------- -------
CLOSING SHAREHOLDERS' FUNDS 142,652 15,091
======= =======
Equity interests 142,652 15,091
======= =======
<PAGE>
<TABLE>
Crescent Lighting Limited
Trading and Profit and Loss Account
for the Year Ended 29 February 1996
<CAPTION>
29.2.96 28.2.95
------------------------------- -------------------------------
(pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C>
Income:
Turnover 1,859,610 863,047
Cost of sales:
Opening stock 66,786 59,765
Purchases 1,204,932 516,643
Sub-contractors 15,784 187
---------- ----------
1,287,502 576,595
Closing stock (124,641) (66,786)
---------- ----------
1,162,861 509,809
---------- ----------
GROSS PROFIT 696,749 353,238
Other income:
Discounts received 94 --
Commission received -- 3,053
Deposit account interest 571 --
---------- ----------
665 3,053
---------- ----------
697,414 356,291
Expenditure:
Directors' remuneration 151,622 116,078
Social security 15,498 11,972
Pension contributions 52,410 12,400
Wages 69,640 31,270
Social security 5,910 3,642
Printing & stationery 6,413 3,743
Telephone, telex & fax 11,244 10,317
Postage & carriage 4,235 4,229
Motor expenses 14,343 8,416
Other operating leases 748 878
Repairs & renewals 6,971 1,447
Sundry expenses 6,011 5,323
Audit & accountancy 5,825 3,075
Professional fees & insurance 11,725 11,551
Subsistence 3,083 1,461
Travel & entertainment 10,736 3,923
Commission paid 54,039 29,129
Advertising & publicity 30,541 29,567
Bad debts 585 (5)
Design & development work 3,055 218
Discounts allowed 5,291 5,379
Freight & insurance 41,251 26,696
Exchange difference (40,439) (32,234)
Subscriptions & donations 328 262
Rent & rates 28,951 28,750
---------- ---------- ---------- ----------
Carried forward 500,016 697,414 317,487 356,291
<FN>
This page does not form part of the statutory financial statements
</FN>
</TABLE>
<PAGE>
<TABLE>
Crescent Lighting Limited
Trading and Profit and Loss Account
for the Year Ended 29 February 1996
<CAPTION>
29.2.96 28.2.95
------------------------- -------------------------
(pound) (pound) (pound) (pound)
<S> <C> <C> <C> <C>
Brought forward 500,016 697,414 317,487 356,291
Light & heat 1,427 1,375
------- -------
501,443 318,862
------- -------
195,971 37,429
Finance costs:
Bank interest 192 11
Other interest 1,166 5,648
Interest on late taxation 78 --
Hire purchase 1,757 655
Bank charges 1,440 952
Miscellaneous charges -- 1,610
------- -------
4,633 8,876
------- -------
191,338 28,553
Depreciation:
Fixtures & fittings 637 953
Plant & machinery 469 150
Office equipment 1,367 1,659
Motor vehicles 9,666 6,448
Computer equipment 5,203 1,708
------- -------
17,342 10,918
------- -------
173,996 17,635
Profit on disposal of fixed assets:
Motor vehicles 429 400
Computer equipment -- 299
------- -------
429 699
------- -------
NET PROFIT (pound) 174,425 (pound) 18,334
======= =======
<FN>
This page does not form part of the statutory financial statements
</FN>
</TABLE>
Exhibit 99.3
FIBERSTARS, INC.
UNAUDITED PRO FORMA COMBINED CONDENSED
FINANCIAL STATEMENTS
The Company completed its acquisition of Crescent Lighting, Ltd. (Crescent) on
November 19, 1998.
The accompanying unaudited pro forma combined condensed balance sheet combines
the historical financial statements of Fiberstars, Inc. (the Company) and the
balance sheet of Crescent as if the acquisition had occurred on September 30,
1998.
The accompanying unaudited pro forma combined condensed statement of operations
for the year ended December 31, 1997 includes the historical consolidated
statement of opeatons of the Company for the year ended December 31, 1997 and
the historical statement of operations of Crescent for the year ended February
28, 1998 as if the acquisition had occurred on January 1, 1997.
The accompanying unaudited pro forma combined consolidated statement of
operations for the nine months ended September 30, 1998 includes the historical
statement of operations of the Company and of Crescent for the nine months ended
September 30, 1998 as if the acquisition had occurred on January 1, 1997.
The unaudited pro forma combined condensed statements of operations give effect
to the acquisition using the purchase method of accounting, and are based upon
allocation of the purchase price and include the adjustments described in the
notes attached thereto.
The unaudited pro forma combined condensed financial statements do not purport
to represent what the Company's results of operations would have been had the
acquisition occurred on the date indicated or for any future period or date. The
pro forma adjustments give effect to available information and assumptions that
the Company believes are reasonable. The unaudited pro forma combined condensed
financial statements shold be read in conjunction with the Company's historical
financial statements and the financial statements of Crescent and the notes
thereto included or incorporated elsewhere herein.
<PAGE>
<TABLE>
FIBERSTARS, INC.
PRO FORMA COMBINED CONDENSED BALANCE SHEET
FOR SEPTEMBER 30, 1998
(amounts in thousands)
(unaudited)
<CAPTION>
Crescent Pro Forma Pro Forma
Fiberstars Lighting (8) Adjustments (8) Combined
<S> <C> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 1,376 $ 459 $ (1,853)(1) $ (18)
Short-term investments 4,080 -- -- 4,080
Accounts receivable trade, net 2,708 1,022 (156)(2) 3,573
Notes and other accounts receivable 145 -- -- 145
Inventories 3,385 396 -- 3,781
Prepaid expenses and other assets 392 -- -- 392
Deferred income taxes 597 -- -- 597
-------- -------- -------- --------
Total current assets 12,683 1,877 (2,009) 12,551
Fixed assets, net 912 165 -- 1,077
Goodwill, net 766 -- 2,099(3) 2,865
Investment in joint ventures 20 -- -- 20
Other assets 205 -- -- 205
Deferred income taxes -- -- -- --
-------- -------- -------- --------
Total assets $ 14,586 $ 2,042 $ 90 $ 16,718
======== ======== ======== ========
LIABILITIES
Current liabilities
Accounts payable $ 1,011 $ 580 $ (156)(4) $ 1,434
Accrued expenses 1,895 799 116(5) 2,810
Current portion of long-term debt 8 -- -- 8
-------- -------- -------- --------
Total current liabilities 2,914 1,379 (41) 4,252
Long-term debt, less current portion 14 -- -- 14
-------- -------- -------- --------
Total liabilities 2,928 1,379 (41) 4,266
-------- -------- -------- --------
SHAREHOLDERS' EQUITY
Common stock -- -- -- --
Additional paid-in capital 12,767 -- 794(6) 13,561
Notes receivable from shareholder (75) -- -- (75)
Accumulated deficit (1,034) 663 (663)(7) (1,034)
-------- -------- -------- --------
Total shareholders' equity 11,658 663 131 12,452
-------- -------- -------- --------
Total liabilities and
shareholders' equity $ 14,586 $ 2,042 $ 91 $ 16,718
======== ======== ======== ========
<FN>
The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>
<PAGE>
FIBERSTARS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED BALANCE SHEET
FOR SEPTEMBER 30, 1998
Note A - Acquisition:
On November 19, 1998, Fiberstars, inc. (the Company) acquired the net
assets of Crescent Lighting, Ltd. (Crescent) for an aggregate of $1,884,597 in
cash and 197,960 shares of the Company's common stock. Crescent is a
manufacturer and distributor of lighting products in Europe. The products are
used primarily for fiber optic lighting.
Note B - Pro Forma Adjustments:
(1) Represents cash payment for acquisition.
(2) Represents elimination of intercompany accounts receivable.
(3) Represents the allocation of goodwill and transaction costs.
(4) Represents the elimination of intercompany accounts payable.
(5) Represents the accrued transaction expenses.
(6) Represents the issuance of Fiberstars common stock.
(7) Represents the elimination of Crescent retained earnings.
(8) Exchange rate used for balance sheet the spot rate effective September
30, 1998, $1.70 = 1.00 GBP.
<PAGE>
<TABLE>
FIBERSTARS, INC.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
(amounts in thousands except per share amounts)
(unaudited)
<CAPTION>
Crescent Pro Forma Pro Forma
Fiberstars Lighting (7) Adjustments (7) Combined
<S> <C> <C> <C> <C>
Net sales $ 17,871 $ 3,957 $ (750)(1) $ 21,078
Cost of Sales 10,047 2,174 (750)(2) 11,471
-------- -------- -------- --------
Gross profit 7,824 1,784 -- 9,608
Operating expenses 6,977 1,222 236(3) 8,435
-------- -------- -------- --------
Operating income 847 562 (236) 1,173
Interest income/(expense) 248 11 (88)(4) 171
Other income/(expense) (14) -- -- (14)
-------- -------- -------- --------
Income before income taxes 1,081 573 (324) 1,330
Provision for income taxes (437) (136) 117(5) (456)
-------- -------- -------- --------
Net income $ 644 $ 437 $ (207) $ 874
======== ======== ======== ========
Net income per share - basic $ 0.19 $ 0.24
======== ========
Shares used in per share
calculation - basic 3,446 198(6) 3,644
======== ======== ========
Net income per share -diluted $ 0.18 $ 0.23
======== ========
Shares used in per share
calculation - diluted 3,597 198(6) 3,795
======== ======== ========
<FN>
The accompanying notes are an integral part of these financial statements
</FN>
</TABLE>
<PAGE>
FIBERSTARS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1997
(1) Represents the elimination of intercompany sales between Crescent and
the Company.
(2) Represents the elimination of intercompany cost of sales between
Crescent and the Company.
(3) Represents the amortization of the goodwill and other intangibles
associated with the purchase of Crescent. The period of amortization is
10 years.
(4) Represents interest income forgone as a result of the reduction in cash
of $2,000,000 for the purchase of Crescent.
(5) Represents tax adjustment to reflect 36% overall income tax rate
applicable to pro forma results.
(6) Represents issuance of common stock as consideration in the Crescent
acquisition.
(7) Exchange rate used for statement of operations is the average rate for
the nine months ending September 30, 1998, $1.64 = 1.00 GBP
<PAGE>
<TABLE>
FIBERSTARS, INC.
PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR NINE MONTHS ENDED SEPTEMBER 30, 1998
(amounts in thousands except per share amounts)
(unaudited)
<CAPTION>
Crescent Pro Forma Pro Forma
Fiberstars Lighting (7) Adjustments (7) Combined
<S> <C> <C> <C> <C>
Net sales $ 16,298 $ 2,846 $ (451)(1) $ 18,693
Cost of Sales 10,188 1,770 (451)(2) 11,507
-------- -------- -------- --------
Gross profit 6,110 1,076 -- 7,186
Operating expenses 5,915 1,191 177(3) 7,283
-------- -------- -------- --------
Operating income 195 (115) (177) (97)
Interest income/(expense) 177 38 (59)(4) 156
Other income/(expense) (20) -- -- (20)
-------- -------- -------- --------
Income before income taxes 352 (77) (235) 40
Provision for income taxes (134) 28 85(5) (22)
-------- -------- -------- --------
Net income $ 218 $ (49) $ (151) $ 18
======== ======== ======== ========
Net income per share - basic $ 0.06 $ 0.00
======== ========
Shares used in per share
calculation - basic 3,557 198(6) 3,755
======== ======== ========
Net income per share - diluted $ 0.06 $ 0.00
======== ========
Shares used in per share
calculation - diluted 3,643 198(6) 3,841
======== ======== ========
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
<PAGE>
FIBERSTARS, INC.
NOTES TO UNAUDITED PRO FORMA COMBINED CONDENSED STATEMENT OF OPERATIONS
FOR NINE MONTHS ENDED SEPTEMBER 30, 1998
(1) Represents the elimination of intercompany sales between Crescent and
the Company.
(2) Represents the elimination of intercompany cost of sales between
Crescent and the Company.
(3) Represents the amortization of the goodwill and other intangibles
associated with the purchase of Crescent. The period of amortization is
10 years.
(4) Represents interest income forgone as a result of the reduction in cash
of $2,000,000 for the purchase of Crescent.
(5) Represents tax adjustment to reflect 36% overall income tax rate
applicable to pro forma results.
(6) Represents issuance of common stock as consideration in the Crescent
acquisition.
(7) Exchange rate used for statement of operations is the average rate for
the twelve months ending December 31, 1997, $1.66 = 1.00 GBP
|
|