-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, S5xCXkcRGWtwGz617Mkbi879tECC9ua6Wsr6/E9p9Hx+tMkvmSaFsKi3EgcMl5El kQSiWNdbzMiJOTRwufuR1Q== 0000742814-98-000006.txt : 19980518 0000742814-98-000006.hdr.sgml : 19980518 ACCESSION NUMBER: 0000742814-98-000006 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980331 FILED AS OF DATE: 19980515 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ARNOX CORP CENTRAL INDEX KEY: 0000742814 STANDARD INDUSTRIAL CLASSIFICATION: LUMBER & WOOD PRODUCTS (NO FURNITURE) [2400] IRS NUMBER: 061094094 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-14724 FILM NUMBER: 98625768 BUSINESS ADDRESS: STREET 1: 1612 N. OSCEOLA AVE CITY: CLEARWATER STATE: FL ZIP: 34615 BUSINESS PHONE: 8134433434 MAIL ADDRESS: STREET 1: 1612 N. OSCEOLA AVENUE CITY: CLEARWATER STATE: FL ZIP: 34615 10QSB 1 Form 10-QSB - Page- FORM 10-QSB SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 (Mark One) [X]QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended March 31, 1998 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 COMMISSION FILE NUMBER 0-14724 ARNOX CORPORATION (Exact name of Issuer as specified in its charter) Delaware 59-3453156 (other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1612 N. Osceola Avenue Clearwater, Florida 33755 (Address of principal offices) (813) 443-3434 (Issuer's telephone number, including area code) Indicate by check mark whether the Issuer (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Issuer was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] State the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable dates. Title of Each Class Outstanding at March 31, 1998 Common Stock, $0.001 Par Value 3,439,247 Shares subject to 11.4642 reverse split, approved by stockholders July 7, 1997 TABLE OF CONTENTS PART I FINANCIAL INFORMATION PAGE ITEM 1 Financial Statements Consolidated Balance Sheets as of March 31, 1998 and March 31, 1997 3 Consolidated Statements of Income for the Three Month Periods Ended March 31, 1998 and March 31, 1997. 4 Consolidated Statements of Cash Flow for the Three Month Periods Ended March 31, 1998 and March 31, 1997. 5 Notes to Financial Statements 6 ITEM 2 Management's Discussion and Analysis of Financial Condition and Results of Operations 7 PART II OTHER INFORMATION 9 SIGNATURES 9 ARNOX CORPORATION (a Dormant State Company) Consolidated Balance Sheet March 31, 1998 and March 31, 1997 (unaudited) 03/31/98 12/31/97 Assets Organization Cost $ 0 $ 0 Total Assets 0 0 Liabilities and Shareholder's Equity Stockholders' Equity Common Stock par value at $.001 per share 10,000,000 shares authorized, 3,439,247.00 shares issued and outstanding 0 0 Additional Paid in Capital 26,409 8,815 Retained Earnings (Deficit) (26,409) (8,815) ______ _______ Total Shareholders' Equity 0 0 ______ _____ Total Liabilities and Shareholders Equity $ 0 $ 0 ========= ======== See accompanying notes to financial statements ARNOX CORPORATION (a Dormant State Company) Consolidated Statements of Operations for the years ending March 31, 1998 and March 31, 1997 (unaudited) 1998 1997* 03-31-97 03-31-96 _______ ________ Revenues $ 0 $ 0 Expenses Administrative Expenses $ 4,570 2,000 Filing Fees $ 0 $ 0 Net Income/Loss for the year $(4,570) (2,000) ========= ======== See accompanying notes to financial statements ARNOX CORPORATION (a Dormant State Company) Consolidated Statements of Cash Flows for three months ended March 31, 1998 and 1997 (unaudited) For Three Months Ended 03-31-98 03- 31-97 Cash Flows from Operating Activities Net Income $ 0 0 Net Cash Provided (used) / By Operating Activities (4,570) (2,000) Expenses Paid by Capston 4,570 2,000 Net Increase (Decrease) in Cash 0 0 Cash at Beginning of Period 0 0 Cash at End of Period $ 0 $ 0 ======== ==== See accompanying notes to financial statements ARNOX CORPORATION (A Dormant State Company) March 31, 1998 Note 1. HISTORY OF THE COMPANY ARNOX Corporation, (A Dormant State Company), was incorporated on October 17, 1983, under the laws of the State of Delaware. The Company conducted an initial public offering of its Common Stock in October, 1985 and in connection with an application to list its Common Stock on the NASDAQ system, the Company also registered its Common Stock pursuant to Section 12(g) of the Securities Exchange Act of 1934. The Company's Common Stock remained listed on the NASDAQ system until April 25, 1989. On September 11, 1989, the Company filed a voluntary petition under Chapter 11 of the Bankruptcy ACT (Case No. 89-97155) in the U.S. Bankruptcy Court for the District of New Jersey. On December 18, 1989, the Company's case under Chapter 11 was voluntarily converted into a case under Chapter 7 of the Bankruptcy Act. As a result of the voluntary conversion of the Company's bankruptcy case, all assets of the Company were transferred to the Trustee in Bankruptcy on the conversion date and the Company ceased all operations. Subsequently, the Trustee in Bankruptcy effected an orderly liquidation of corporate assets and used the proceeds to repay the Company's creditors. On July 12, 1994 the Company's case under Chapter 7 was closed by an order of the Court and the Trustee in Bankruptcy was discharged. As a result of the Bankruptcy, the Company has no assets, liabilities, management or ongoing operations and has not engaged in any business activities since December 18, 1989. Note 2. RESTORATION OF CORPORATE STATUS On June 10, 1996, acting in its capacity as the holder of 884 shares (0.026%) of the Company's common stock, and without first receiving the consent, approval or authorization of any other person associated with the Company, Capston Network Company effected a renewal, revival and restoration of the Company's certificate of incorporation pursurant to Section 312 of the General Corporation Law of Delaware. Thereafter, Capston filed a 10-K for the years ending December 31, 1989-1995, and a Proxy Statement seeking approval and ratification of its actions, along with authorization to seek a suitable business combination transaction. This proxy statement was ultimately distributed to the Company's stockholders and the proposals therein were approved by the holders of a majority of the Company's issued and outstanding shares. Under the terms of the original Proxy Statement, Capston was authorized to seek a suitable business combination transaction on behalf of the Company and to submit the terms of any proposed business combination transaction to the Company's stockholders for their approval. Capston did not receive and was not entitled to receive any equity interest in the Company as a result of it's actions prior to the date of the Proxy Statement. Moreover, Capston was not entitled to reimbursement for any expenses incurred by it on behalf of the Company except to the extent that the terms of a business combination transaction provided for the reimbursement of such expenses. However, because Sally Fonner is both the President of ARNOX and Capston, prior Staff Accounting Bulletins require under generally accepted accounting the treatment of debiting the expenses with corresponding credit to paid-in capital. Future expenses of Capston or others will be treated this way. These expenses are actual cash expenditures and do not reflect any costs associated with the operation of Capston nor any personnel time or cost. Note 3. FUTURE EXPENSES Capston will continue to extend administrative expenses to keep ARNOX current with its reporting requirements, keeping the Corporation in good standing, any required proxy solicitation or acquisition efforts. These amounts should not exceed $50,000 in out-of-pockets costs. In addition, as approved, and as a result of a suitable acquisition, additional fees paid for by issuance of equity position would be for: (i) Capston of 300,000 shares, (ii)up to 11,500,000 shares for an acquisition(s) and (iii) up to 5% of the acquisition for a finder's fee . Item 2. Management Discussion and Analysis of Financial Condition and Results of Operations. Financial Condition As a result of its 1989 Bankruptcy, the Company has no assets, liabilities, or ongoing operations and has not engaged in any business activities since September 1989. The Company had no operations during the year ended December 31, 1996 and no material assets or liabilities as of December 31, 1996. The reported loss from operations in 1996 resulted solely from expenses incurred by Capston on behalf of the Company in connection with the restoration of the Company's corporate charter and the preparation and filing of certain reports required under the Securities Exchange Act of 1934. It is the intention of management to seek stockholder approval of a Revised Plan whereby the Company will be restructured as a "clean public shell" for the purpose of effecting a business combination transaction with a suitable privately-held company that has both business history and operating assets, although there can be no assurance that management will be successful in its effforts to negotiate such a transaction. Potential Acquisition The Company has been actively seeking an acquisition of assets, property or business that may benefit the Company and its stockholders. Registrant has reached a preliminary oral understanding (the "Understanding") to acquire (the "Acquisition") three privately-held companies (the "Companies") which provide wireless telecommunications and ancillary support services. In the Acquisition, Registrant will issue a total of 11,500,000 shares of its common stock in exchange for all of the Companies' outstanding capital stock, thereby resulting in control of Registrant by the Companies' shareholders. The Acquisition is contingent upon Registrant's acceptance of: 1. the valuation of the Companies' business plans; 2. financial statements and other documentation acceptable to Registrant. The Companies have engaged an independent third party to perform a valuation study of the Companies and their business plans, and are preparing audited financial statements. This Understanding will be embodied in a definitive reorganization agreement containing the foregoing terms and conditions, as well as customary representations, warranties and conditions. Registrant and the Companies hope to complete the Acquisition during the second quarter of 1998. Results of Operations For the past one and three quarter half years, the Company has been actively seeking an acquisition of assets, property or business that may benefit the Company and its stockholders. While these efforts have not resulted in a suitable business combination transaction, the Company's experience during this period confirms that demand for well structured clean public shells is strong. Over the last eight months, the Company has been evaluated by a number of potential acquisition candidates. In each case, however, the Company has been rejected as unsuitable because (1) the Capital structure of the Company was not suitable, (2) Capston lacked the authority to negotiate a binding transaction for the Company, and (3) any proposed business combination would entail the cost and delay of preparing a business combination proxy statement and holding an additional stockholders meeting with no assurance that the proposed business combination would be approved by the stockholders. Therefore, it became clear that Capston needed to propose a revised plan to the stockholders. Management intends to seek stockholder approval of the Revised Plan described elsewhere herein at the earliest practicable date. Plan of Operation. The Company has not engaged in any material operations or had any revenues from operations during the two preceeding years. The Company's plan of operation for the next twelve months is to continue to seek the acquisition of assets, property or business that may benefit the Company and its stockholders. Because the Company has no resources, management anticipates that to achieve any such acquisition, the Company will be required to issue shares of its common stock as the sole consideration for such acquisition. During the next twelve months, the Company's only foreseeable cash requirements will relate to maintaining the Company in good standing or the payment of expenses associated with reviewing or investigating any potential business venture, which are anticipated to be advanced by Capston as loans to the Company. Because the Company has not identified any such venture as of the date of this Registration Statement, it is impossible to predict the amount of any such loans. However, any loans from Capston will be on terms no less favorable to the Company than would be available from a commercial lender in an arm's length transaction. As of the date of this Annual Report on Form 10-K, the Company has not begun seeking any acquisition. Capston will continue to extend administrative expenses to keep ARNOX current with its reporting requirements, keeping the Corporation in good standing, any required proxy solicitation or acquistion efforts. Management anticipates that Capston, will advance minor administrative expenses up to approximately $5,000.*These amounts should not exceed $50,000 in out-of-pockets costs. In addition, if approved, additional costs associated with a business combination paid for by issuance of equity position would be for: (i) Capston of 300,000 shares, (ii)up to 11,500,000 shares for an acquisition(s) and (iii) up to 5% of the acquisition for a finder's fee. In the event that additional funding is required in order to keep the Company in good standing and/or to review or investigate any potential merger or acquisition candidate, the Company may attempt to raise such funding through a private placement of its common stock to accredited investors. At the present time, management has no plans to offer or sell any securities of the Company. However, at such time as the Company may decide to engage in such activities, management may use any legal means of conducting such offer or sale, including registration with the appropriate federal and state regulatory agencies and any registration exemptions that may be available to the Company under applicable federal and state laws. Because the Company is not currently making any offering of its securities, and does not anticipate making any such offering in the foreseeable future, management does not believe that Rule 419 promulgated by the Securities and Exchange Commission under the Securities Act of 1933, as amended, concerning offerings by blank check companies, will have any effect on the Company or any activities in which it may engage in the foreseeable future. PART II - OTHER INFORMATION ITEM 1.LEGAL PROCEEDINGS NONE ITEM 2.CHANGES IN SECURITIES AS OF SEPTEMBER 25, 1997, LUMIERE SECURITIES RECEIVED CLEARANCE TO MAKE A MARKET IN ARNOX UNDER THE TRADING SYMBOL ARXC. ITEM 3.DEFAULTS ON SENIOR SECURITIES NONE ITEM 4.SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS On June 13, 1997, the Registrant sent to its stockholders a Notice of Special Meeting and Proxy Statement which described a number of proposals relating to a plan of reorganization proposed by Capston Network Company ("Capston"), a stockholder of the Company. Subsequently, on July 7, 1997, a Special meeting of the Stockholders was held and all of the proposals were approved by a majority vote of the Stockholders. The principal proposals approved by the stockholders were: 1. To elect a person designated by Capston to serve as the sole member of the Board of Directors until the next annual Meeting of stockholders, or until her successor is elected and qualified; 2. To consider and vote upon a proposed Amendment to the Company's Certificate of Incorporation that will effect a reverse split of all issued and outstanding shares of Common Stock in the ratio of one (1) share of new Common Stock for each 11.4642 shares presently outstanding so that immediately thereafter the Company will have a total of 300,000 shares issued and outstanding; 3. To consider and vote upon a proposal to issue 300,000 shares of Common Stock to persons designated by Capston as compensation for services rendered in connection with the implementation of the Revised Plan; 4. To consider and vote upon a proposal which will give the Board of Directors authority to pay an in-kind Finder's Fee to unrelated third party finders who introduce the Company to a suitable acquisition prospect. 5. To consider and vote upon a proposal that will give the Board of Directors discretionary authority to (i) change the Company's name and (ii) issue up to 11,500,000 shares of Common Stock to unrelated third parties, all without prior stockholder approval, in connection with a business combination transaction of the type contemplated by the Revised Plan; and 6. To consider and vote upon a proposed Amendment to the Company's Certificate of Incorporation that will increase the authorized capital stock of the Company to 25,000,000 shares of $0.01 par value Common Stock and 5,000,000 shares of $0.01 par value Preferred Stock. ITEM 5.OTHER INFORMATION NONE ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K A. Exhibits None B. Reports on Form 8-K None SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. ARNOX Corporation /S/ Sally A. Fonner Chief Executive Officer Dated: March 31, 1998 /S/ Sally A. Fonner Chief Financial Officer Dated: March 31, 1998 EX-27 2
5 3-MOS DEC-31-1998 MAR-31-1998 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
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