SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 12b-25
Commission File Number 1-13760
NOTIFICATION OF LATE FILING
(Check One):
[ ] Form 10-KSB [ ] Form 11-K [ ] Form 20-F [ ] Form 10-Q [ ] Form N-SAR
For Period Ended: ______________
[X] Transition Report on Form 10-KSB [ ] Transition Report on Form 10-Q
[ ] Transition Report on Form 20-F [ ] Transition Report on Form N-SAR
[ ] Transition Report on Form 11-K
For the Transition Period Ended: June 30, 1999
READ ATTACHED INSTRUCTIONS SHEET BEFORE PREPARING FORM. PLEASE PRINT OR TYPE.
Nothing in this form shall be construed to imply that the Commission has
verified any information contained herein. If the notification relates to a
portion of the filing checked above, identify the item(s) to which the
notification relates:
PART I
REGISTRANT INFORMATION
Full name of registrant The Network Connection, Inc.
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Former name if applicable
N/A
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Address of principal executive office (STREET AND NUMBER)
222 North 44th Street
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City, state and zip code Phoenix, Arizona 85034
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PART II
RULES 12B-25(B) AND (C)
If the subject report could not be filed without unreasonable effort or
expense and the registrant seeks relief pursuant to Rule 12b-25(b), the
following should be completed. (Check box if appropriate)
[X] (a) The reasons described in reasonable detail in Part III of this
form could not be eliminated without unreasonable effort or
expense;
[X] (b) The subject annual report, semi-annual report, transition report
on Form 10-KSB, Form 20-F, 11-K, Form N-SAR, or portion thereof,
will be filed on or before the 15th calendar day following the
prescribed due date; or the subject quarterly report of
transition report on Form 10-Q, or portion thereof will be filed
on or before the fifth calendar day following the prescribed due
date; and
[X] (c) The accountant's statement or other exhibit required by Rule
12b-25(c) has been attached if applicable.
PART III
NARRATIVE
State below in reasonable detail the reasons why Form 10-KSB, 11-K, 20-F,
10-Q, N-SAR, or the transition report or portion thereof could not be filed
within the prescribed time period. (Attach extra sheets if needed.)
<PAGE>
The Report on Form 10-KSB for The Network Connection, Inc., (the "Company")
for the transition period ended June 30, 1999 is due to be filed with the
Securities and Exchange Commission (the "SEC") on September 28, 1999. On May 18,
1999, the Company completed the acquisition of substantially all of the assets
of the interactive entertainment division of Interactive Flight Technologies,
Inc. ("IFT"). In consideration of the IFT transaction, the Company issued
1,055,745 shares of the Company's Common Stock and 2,495,400 shares of the
Company's Series D Convertible Preferred Stock to IFT. The IFT transaction was
accounted for as a reverse merger whereby, for accounting purposes, IFT is
treated as the acquiror of the Company, and the Company is treated as the
successor to the historical operations of the interactive entertainment division
of IFT. Accordingly, the historical financial statements of the Company will be
replaced with those of the interactive entertainment division of IFT. Due to the
accounting complexities resulting from the IFT transaction, including the fact
that the interactive entertainment division has not historically been audited as
a stand alone entity, the Company and its independent public accountants will
not be able to compile and present the financial information and other data (nor
the related Management's Discussion and Analysis) required by Form 10-KSB in an
appropriate manner by the prescribed due date without unreasonable effort or
expense.
PART IV
OTHER INFORMATION
(1) Name and telephone number of person to contact in regard to this
notification
Morris C. Aaron 602 629-6200
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(Name) (Area Code) (Telephone Number)
(2) Have all other periodic reports required under Section 13 or 15(d) of
the Securities Exchange Act of 1934 or Section 30 of the Investment Company Act
of 1940 during the preceding 12 months (or for such shorter period that the
registrant was required to file such report(s) been filed? If the answer is no,
identify report(s).
[X] Yes [ ] No
(3) Is it anticipated that any significant change in results of operations
from the corresponding period for the last fiscal year will be reflected by the
earnings statements to be included in the subject report or portion thereof?
[X] Yes [ ] No
If so: attach an explanation of the anticipated change, both narratively
and quantitatively, and, if appropriate, state the reasons why a reasonable
estimate of the results cannot be made.
The IFT transaction as described above was accounted for as a reverse
merger whereby, for accounting purposes, IFT is treated as the acquiror of the
Company, and the Company is treated as the successor to the historical
operations of the interactive entertainment division of IFT. Accordingly, the
historical financial statements of the Company will be replaced with those of
the interactive entertainment division of IFT.
Estimated revenues for the eight months ended June 30, 1999 were
approximately $1 million, a decrease of 86% compared with revenues of
approximately $18.4 million for the corresponding period of the previous fiscal
period.
Estimated cost of equipment sales for the eight months ended June 30, 1999
were approximately $1.5 million, a decrease of 90% compared to cost of sales of
approximately $15.3 million in the corresponding period of the previous fiscal
period.
For the eight months ended June 30, 1999, the Company recorded warranty,
maintenance and commission accrual adjustments of approximately $7.2 million
compared to none in the corresponding period of the previous fiscal period.
Estimated special charges for the eight months ended June 30, 1999 were
approximately $522,000, compared to none for the corresponding period of the
previous fiscal period.
Estimated net income (loss) for the eight months ended June 30, 1999 was
approximately $2.7 million versus approximately ($1.9) million in the
corresponding period of the previous fiscal period.
The Network Connection, Inc.
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(Name of Registrant as Specified in Charter)
Has caused this notification to be signed on its behalf by the undersigned
thereunto duly authorized.
<PAGE>
Date September 29, 1999 By /s/ Morris C. Aaron
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INSTRUCTION: The form may be signed by an executive officer of the
registrant or by any other duly authorized representative. The name and title of
the person signing the form shall be typed or printed beneath the signature. If
the statement is signed on behalf of the registrant by an authorized
representative (other than an executive officer), evidence of the
representative's authority to sign on behalf of the registrant shall be filed
with the form.
<PAGE>
The Network Connection, Inc.
222 N. 44th Street
Phoenix, Arizona 85034
Ladies and Gentlemen:
Pursuant to Rule 12b-25 of the General Rules and Regulations under the
Securities Exchange Act of 1934, we inform you that we have been furnished a
copy of Form 12b-25 to be filed by The Network Connection, Inc. on or about
September 28, 1999, which contains notification of the registrant's inability to
file its transition Form 10-KSB by September 28, 1999. We have read the
Company's statements contained in Part III therein and we agree with the stated
reasons as to why we have been unable to complete our audit and report on the
financial statements for the eight month transition period ended June 30, 1999,
to be included in transition Form 10-KSB.
Very truly yours,
KPMG LLP
