<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-KSB
(Mark One)
[ ] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the fiscal year ended ____________________________________________
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ______________ to _______________
[ X ] SPECIAL FINANCIAL REPORT UNDER RULE 15d-2 UNDER THE SECURITIES EXCHANGE
ACT OF 1934.
For the fiscal year ended September 30, 1997
THIS REPORT CONTAINS ONLY FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED
SEPTEMBER 30, 1997.
The Issuer has filed a registration statement on Form SB-2 that was
declared effective by the Securities and Exchange Commission on October 17,
1997. That registration statement related to an offering of securities by
the Issuer under Rule 419 of the Securities Act of 1933. As of the date of
this filing, the Issuer has not sold any securities pursuant to that
registration statement.
Commission file number: Registration No. 33-88270
SCHUYLKILL ENTERPRISES, INC.
- --------------------------------------------------------------------------------
(Name of Small Business Issuer In Its Charter)
DELAWARE 23-2751054
- ------------------------------- -----------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
Two Penn Center, Suite 605, Philadelphia, PA 19102
- -------------------------------------------- ------------
(Address of Principal Executive Offices) (Zip Code)
(215) 564-3131
- --------------------------------------------------------------------------------
(Issuer's Telephone Number, Including Area Code)
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Securities registered pursuant to Section 12(b) of the Act:
Name on Each Exchange
Title of Each Class on Which Registered
- ------------------------------------- ----------------------------------------
Securities registered under Section 12(g) of the Exchange Act:
_______________________________________________________________________________
(Title of Class)
Check whether the Issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for
such shorter period that the Registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
YES NO X
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 /x/
State the Issuer's revenues for its most recent fiscal year: The Issuer
had no revenues from operations during the most recent fiscal year. The
Issuer had $626 of interest income during the most recent fiscal year.
State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the stock was
sold, or the average of the bid and asked prices of such stock, as of a
specified date within the past 60 days. (See definition of affiliate in Rule
12b-2 of the Exchange Act.): There is currently no market for the Issuer's
common stock.
State the number of shares outstanding of each of the Issuer's classes
of common equity, as of the latest practicable date: 450,000 as of the date
of this filing.
DOCUMENTS INCORPORATED BY REFERENCE
The Issuer has filed a registration statement on form SB-2 that was
declared effective by the Securities and Exchange Commission on October 17,
1997. That registration statement related to an offering of securities by
the Issuer under Rule 419 of the Securities Act of 1933. As of the date of
this filing, the Issuer has not sold any securities pursuant to that
registration statement. Although none of the Form SB-2 is specifically
incorporated by reference into this current filing, this current filing is
related to the Form SB-2 and is required pursuant to Rule 15d-2 of the
Securities Exchange Act of 1934.
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SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
CONTENTS
PAGE
----
INDEPENDENT AUDITORS' REPORT F-1
BALANCE SHEETS AS OF SEPTEMBER 30, 1996 AND 1997 F-2
STATEMENTS OF OPERATIONS FOR THE YEARS
ENDED SEPTEMBER 30, 1996 AND 1997; AND
FROM NOVEMBER 22, 1993 (INCEPTION DATE)
TO SEPTEMBER 30, 1997 F-3
STATEMENT OF SHAREHOLDERS' EQUITY FROM
NOVEMBER 22, 1993 (INCEPTION DATE) TO
SEPTEMBER 30, 1997 F-4
STATEMENTS OF CASH FLOWS FOR THE YEARS
ENDED SEPTEMBER 30, 1996 AND 1997; AND
FROM NOVEMBER 22, 1993 (INCEPTION DATE)
TO SEPTEMBER 30, 1997 F-5
NOTES TO FINANCIAL STATEMENTS F-6
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INDEPENDENT AUDITORS' REPORT
To the Shareholders and Board of Directors
Schuylkill Enterprises, Inc.
Bala Cynwyd, Pennsylvania
We have audited the accompanying balance sheets of Schuylkill Enterprises,
Inc. (a development stage company) as of September 30, 1996 and 1997 and the
related statements of operations and cash flows for the years ended September
30, 1996 and 1997 and the period from November 22, 1993 (inception date) to
September 30, 1997 and statement of shareholders' equity for the period from
November 22, 1993 (inception date) to September 30, 1997. These financial
statements are the responsibility of the company's management. Our
responsibility is to express an opinion on these financial statements based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Schuylkill Enterprises, Inc.
as of September 30, 1996 and 1997, and the results of its operations and cash
flows for the years ended September 30, 1996 and 1997, and the period from
November 22, 1993 (inception date) to September 30, 1997 in conformity with
generally accepted accounting principles.
COGEN SKLAR LLP
December 30, 1997
F-1
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SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
BALANCE SHEETS
September 30, 1996 September 30, 1997
------------------ ------------------
ASSETS
CURRENT ASSETS
Cash $ 7,588 $ 4,017
Accrued interest receivable 1,825 2,263
Receivable from affiliated
company 6,957 6,957
Deferred offering costs - 20,750
------------ -------------
TOTAL ASSETS $ 16,370 $ 33,987
------------ -------------
------------ -------------
LIABILITIES
CURRENT LIABILITIES
Accrued expenses $ 700 $ 19,705
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SHAREHOLDERS' EQUITY
PREFERRED STOCK - $.001 par value,
authorized; 2,000,000 shares,
none issued - -
COMMON STOCK - $.001 par value,
authorized 10,000,000 shares,
issued and outstanding
450,000 shares 450 450
ADDITIONAL PAID-IN CAPITAL 49,550 49,550
DEFICIT ACCUMULATED DURING THE
DEVELOPMENT STAGE (34,330) (35,718)
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TOTAL SHAREHOLDERS' EQUITY 15,670 14,282
------------ -------------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $ 16,370 $ 33,987
------------ -------------
------------ -------------
The accompanying notes are an integral part of these financial statements.
F-2
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SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Year Ended
-------------------------------------------
November 22, 1993
(Inception Date) to
September 30, 1996 September 30, 1997 September 30, 1997
------------------ ------------------ --------------------
<S> <C> <C> <C>
INTEREST INCOME $ 900 $ 626 $ 2,451
------------------ ------------------ --------------------
COSTS AND EXPENSES
Aborted offering costs - - 26,487
Legal fees - - 6,000
Accounting fees - 900 1,533
Franchise tax 700 1,114 3,962
Other - - 187
------------------ ------------------ --------------------
700 2,014 38,169
------------------ ------------------ --------------------
NET INCOME (LOSS) $ 200 $ (1,388) $(35,718)
------------------ ------------------ --------------------
------------------ ------------------ --------------------
INCOME (LOSS) PER
SHARE $ - $ -
------------------ ------------------
------------------ ------------------
WEIGHTED AVERAGE
NUMBER OF SHARES 450,000 450,000
------------------ ------------------
------------------ ------------------
</TABLE>
The accompanying notes are an integral part to these financial statements.
F-3
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SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
STATEMENT OF SHAREHOLDERS' EQUITY
NOVEMBER 22, 1993 (INCEPTION DATE) TO SEPTEMBER 30, 1997
<TABLE>
<CAPTION>
Deficit
Accumulated
Additional During the Total
Common Paid-In Development Shareholders'
Stock Capital Stage Equity
------ ----------- ----------- -------------
<S> <C> <C> <C> <C>
Issuance of 900,000 shares of common stock $ 900 $ 49,100 $ - $50,000
One for two reverse stock split (450) 450 - -
Net loss from inception to September 30, 1994 - - (160) (160)
------ ----------- ----------- -------------
Balance, September 30, 1994 450 49,550 (160) 49,840
Net loss for the year ended September 30, 1995 - - (34,370) (34,370)
------ ----------- ----------- -------------
Balance, September 30, 1995 450 49,550 (34,530) 15,470
Net income for the year ended September 30, 1996 - - 200 200
------ ----------- ----------- -------------
Balance, September 30, 1996 450 49,550 (34,330) 15,670
Net loss for the year ended September 30, 1997 - - (1,388) (1,388)
------ ----------- ----------- -------------
Balance, September 30, 1997 $ 450 $ 49,550 $ (35,718) $ 14,282
------ ----------- ----------- -------------
------ ----------- ----------- -------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-4
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SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Year Ended November 22, 1993
-------------------------------------- (Inception Date) to
September 30, 1996 September 30, 1997 September 30, 1997
------------------ ------------------ --------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES
Net income (loss) $ 200 $ (1,388) $ (35,718)
Adjustments to reconcile net income
(loss) to net cash provided by
(used in) operating activities
Increase in accrued interest (900) (438) (2,263)
Increase (decrease) in accrued
expenses (1,800) 19,005 19,705
------------------ ------------------ --------------------
Net cash provided by (used in)
operating activities (2,500) 17,179 (18,276)
------------------ ------------------ --------------------
CASH FLOWS FROM FINANCING
ACTIVITIES
(Advance) repayment of receivable
from affiliated companies 5,662 - (6,957)
Proceeds from issuance of common
stock - - 50,000
Deferred offering costs - (20,750) (20,750)
------------------ ------------------ --------------------
Net cash provided by (used in)
financing activities 5,662 (20,750) 22,293
------------------ ------------------ --------------------
NET INCREASE (DECREASE) IN CASH 3,162 (3,571) 4,017
CASH - BEGINNING OF PERIOD 4,426 7,588 -
------------------ ------------------ --------------------
CASH - END OF PERIOD $ 7,588 $ 4,017 $ 4,017
------------------ ------------------ --------------------
------------------ ------------------ --------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-5
<PAGE>
SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 22, 1993 (INCEPTION DATE) TO SEPTEMBER 30, 1997
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization
The company was incorporated in Delaware on November 22, 1993. The company
intends, upon completion of a public offering, to seek potential business
combinations. Since planned principal operations have not commenced, the
company is considered a development stage company, as defined in the Statement
of Financial Accounting Standards No. 7 (SFAS 7).
Cash Equivalents
The company considers all highly liquid instruments with a maturity of three
months or less to be cash equivalents.
Fair Value of Financial Instruments
Financial instruments consist of cash, accrued interest, receivables and accrued
expenses. The carrying amount approximates fair value because of the short
maturity of these instruments.
Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires the use of estimates based on management's
knowledge and experience. Accordingly, actual results could differ from those
estimates.
Deferred Offering Costs
Amounts paid or accrued for costs related to the anticipated public offering
will be expensed and not recorded as a reduction of the proceeds, if the
offering is not completed.
In early 1995, the company filed a registration statement under Form SB-2 with
the Securities and Exchange Commission. The filing never became effective,
therefore deferred offering costs of $26,487 were expensed during the year ended
September 30, 1995.
Income Taxes
The company has adopted SFAS 109, "Accounting for Income Taxes", which requires
an asset and liability approach to financial accounting and reporting for income
taxes. Deferred income tax assets and liabilities are computed annually for
temporary differences between the financial statement and tax bases of assets
and liabilities that will result in taxable or deductible amounts in the future
based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income. Valuation allowances are
established when necessary to reduce deferred tax assets to the amount expected
to be realized. Income tax expense is the tax payable or refundable for the
period plus or minus the change during the period in deferred tax assets and
liabilities.
Income (Loss) Per Share
Income (loss) per share has been computed as if the common shares were
outstanding from inception since their issuance was in contemplation of the
initial public offering.
Recently Issued Accounting Pronouncements
During February 1997, the Financial Accounting Standard Board issued SFAS No.
128, "Earnings Per Share." This statement establishes standards for computing
and presenting EPS, replacing the presentation of currently required primary EPS
with a presentation of Basic EPS. For entities with complex capital structures,
the statement requires the dual presentation of both Basic EPS and Diluted EPS
on the face of the statement of operations. Under this new standard, Basic EPS
is computed based on weighted average shares outstanding and excludes any
potential dilution; Diluted EPS reflects potential dilution from the exercise of
conversion of securities into common stock and is similar to the currently
requirements fully diluted EPS, SFAS 128 is effective for financial statements
issued for periods ending after December 15, 1997, including interim periods,
and earlier application is not permitted. Adoption of SFAS 128 is not expected
to have a material effect on the company's loss per share.
F-6
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SCHUYLKILL ENTERPRISES, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
NOVEMBER 22, 1993 (INCEPTION DATE) TO SEPTEMBER 30, 1997
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Recently Issued Accounting Pronouncements (Continued)
During June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive
Income". This statement establishes standards for reporting and display of
comprehensive income and its components. The reporting and display requirements
of SFAS No. 130 are effective for fiscal years beginning after December 15,
1997. The company presently intends to comply with this statement for its year
ended December 31, 1998.
During June 1997, the FASB issued SFAS No. 131, "Disclosures About Segments of
an Enterprise and Related Information". This statement establishes standards
for the way that public business enterprises report information about operating
segments in annual financial statements and related disclosures about products
and services, geographic areas and major customers. The reporting and
disclosure requirements of SFAS No. 131 are effective for periods beginning
after December 15, 1997. The company presently intends to comply with this
statement for its year ended December 31, 1998.
NOTE 2 - RECEIVABLE FROM AFFILIATES
During October 1994, the company advanced the sum of $10,619 to American Maple
Leaf Financial Corporation ("AML"). AML is a Philadelphia, Pennsylvania based
investment banking firm that specializes in corporate finance and analysis of
development stage companies. A majority of the outstanding stock of AML is
owned by the directors and certain of the principal stockholders of the company.
The loan provides for repayment upon demand with an interest rate of 9%. In
August 1996, AML repaid $3,662. Interest income of $900 and $626 has been
accrued for the years ended September 1996 and 1997.
Also in October 1994, the company advanced the sum of $2,000 to LMI Acquisition
Corporation ("LMI") related through common ownership and management, which was
repaid in August 1996.
NOTE 3 - CAPITAL STOCK
During the period July through November 1994, the company issued 450,000 shares
of common stock (after effect of one for two reverse stock split) for cash of
$50,000.
The company has reserved 250,000 shares of common stock for issuance upon the
exercise of warrants (Note 4).
The company originally had authorized but not issued 50,000,000 shares of a
class of preferred stock, par value $.001 per share which may be issued in one
or more series. The dividends, liquidation preferences and other rights and
preferences of each series of the preferred stock may be established from time
to time by the Board of Directors.
On January 21, 1997, the Board of Directors approved a decrease in the number of
authorized shares from 150,000,000 to 12,000,000 shares consisting of 10,000,000
shares of common stock with a par value of $.001 per share and 2,000,000 shares
of preferred stock with a par value of $.001 per share.
On September 18, 1997, the Board of Directors approved a two for one reverse
stock split. All references to number of shares and per share amounts in the
financial statements and notes have been adjusted to give retroactive effect to
the stock split.
NOTE 4 - CONTEMPLATED PUBLIC OFFERING
The company has filed a registration statement on Form SB-2 offering for sale
50,000 units at $2.00 per unit, which was declared effective by the
Securities and Exchange Commission on October 17, 1997. Each unit consisting
of one share of common stock and five Redeemable A Warrants. Each Redeemable
A Warrant entitles the holder to purchase at any time until the first
anniversary of the date of the Prospectus, one share of common stock at an
exercise price of $5.00.
F-7
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SIGNATURES
In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this Report to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Philadelphia,
Commonwealth of Pennsylvania on January 15, 1998.
SCHUYLKILL ENTERPRISES, INC.
By: /s/ Leonard Linsker
-------------------------------------------
Leonard Linsker, Chairman, Chief Executive
Officer and Director
[Principal Executive Officer]
_______________________
In accordance with the Securities Exchange Act of 1934, this Report has
been duly signed on January 15, 1998 by the following persons in the capacities
indicated.
Name Title
---- -----
/s/ Leonard Linsker Chairman, Chief Executive Officer and Director
- ------------------------------ [Principal Executive Officer]
Leonard Linsker
/s/ David Alperin Treasurer, Secretary and Director
- ------------------------------ [Principal Accounting Officer and
Principal Financial Officer]
David Alperin
