-----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, B7ReYGjtC/Ji6/PaaX2Z0H/lCRyVfR9mcVQMHZAhCxs7iTDGFXqqM+s61ytPIf3d +MmWTu8hKHreMR/a5X4X7Q== 0000849401-98-000028.txt : 19981103 0000849401-98-000028.hdr.sgml : 19981103 ACCESSION NUMBER: 0000849401-98-000028 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19980818 ITEM INFORMATION: FILED AS OF DATE: 19981102 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADM TRONICS UNLIMITED INC/DE CENTRAL INDEX KEY: 0000849401 STANDARD INDUSTRIAL CLASSIFICATION: ADHESIVES & SEALANTS [2891] IRS NUMBER: 221896032 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: SEC FILE NUMBER: 000-17629 FILM NUMBER: 98736297 BUSINESS ADDRESS: STREET 1: 224 S PEGASUS AVE CITY: NORTHVALE STATE: NJ ZIP: 07647 BUSINESS PHONE: 2017676040 MAIL ADDRESS: STREET 1: 224 S PEGASUS AVE CITY: MORTHVALE STATE: NJ ZIP: 07647 8-K/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) August 18, 1998 ADM Tronics Unlimited, Inc. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation) 0-17629 22-1896032 (Commission File Number) (IRS Employer Identification Number) 224-S Pegasus Avenue, Northvale, NJ 07647 (Address of principal executive offices, Zip Code) Registrant's telephone number, including area code 201-767-6040 1 Item 5. Other Events The Company has been notified by the Nasdaq Stock Market ("Nasdaq") that if the closing bid price of the Company's Common Stock (the "Common Stock") is not at least $1.00 per share on or before December 11, 1998 and at least the next ten trading days or if the Company is not otherwise in compliance with Nasdaq's requirements, the Common Stock will be delisted from Nasdaq. Accordingly, the Company intends to effect a 1 for 4 reverse split of the Common Stock, subject to shareholder approval. If such de-listing were to occur, an investor could find it more difficult to dispose of, or to obtain accurate quotations as to the market value of, the Common Stock. In addition, if the Common Stock were to become de-listed from trading on Nasdaq and the trading price of the Common Stock were below $5.00 per share, which it is as of the date of this Prospectus, trading in the Common Stock would also be subject to the requirements of certain rules promulgated under the Exchange Act which require additional disclosure by broker-dealers in connection with any trades involving a stock defined as a penny stock (generally, any non-Nasdaq equity security that has a market price of less than $5.00 per share, subject to certain exceptions). Such rules require the delivery, prior to any penny stock transaction, of a disclosure schedule explaining the penny stock market and the risks associated therewith, and impose various sales practice requirements on broker-dealers who sell penny stocks to persons other than established customers and accredited investors (generally institutions). For these types of transactions, the broker-dealer must make a special suitability determination for the purchaser and have received the purchaser's written consent to the transaction prior to sale. The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions in the Common Stock, which could severely limit the market liquidity of the Common Stock and the ability of purchasers in this offering to sell the Common Stock and Warrants in the secondary market. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (a), (b) UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION ADM Tronics Unlimited, Inc. (the Company) acquired certain assets from Electropharmacology, Inc. (the acquired business or EPI) included in the Unaudited Pro Forma combined financial statements. This transaction was consummated on August 18, 1998. The following pro forma financial information presents a) the Company and EPI's pro forma unaudited combining statement of operations for the year ended March 31, 1998 as if the acquisition of the entity occurred on April 1, 1997; and b) the Company and EPI's pro forma unaudited combining statement of operations for the three months ended June 30, 1998 as if the acquisition of the entity occurred on April 1, 1998; and c) the Company and EPI's pro forma unaudited combining balance sheet as of June 30, 1998, as if the acquisition of the business occurred on June 30, 1998. This unaudited pro forma financial information does not purport to represent what the Company's financial position or results of operations would actually have been if such transaction in fact occurred on those dates, or to project the Company's financial position or results of operations for any future date or period. These unaudited pro forma combining financial statements should be read in conjunction with the historical financial statements of ADM Tronics Unlimited, Inc. and those of the business acquired. ADM TRONICS UNLIMITED, Inc. UNAUDITED PRO FORMA COMBINED BALANCE SHEET JUNE 30, 1998
(4) (1) (2) ADJUSTED ADM TRONICS ACQUIRED ACQUIRED PRO FORMA PRO FORMA UNLIMITED, INC. ENTITY ADJUSTMENTS ENTITY ADJUSTMENTS COMBINED ASSETS Cash 805,028 62,465(3) (62,465) 0 (5) (75,000) 730,028 Accts. receivable 325,798 126,723(3) (126,723) 0 325,798 Inventories: Raw materials 204,729 159,043(3) (159,043) 0 204,729 Finished goods 56,426 0 0 0 56,426 Other current assets 23,395 164,143(3) (164,143) 0 23,395 Property and Equipment 79,153 84,327(3) 20,673 105,000 184,153 Equipment in use and under lease agreements 78,412 484,170(3) 178,170 306,000 384,412 Equipment held for sale 303,633 0(3) 1,117,000 1,117,000 1,420,633 Loan receivable from officer 71,877 0 71,877 Other assets 593,250 91,163(3) (91,163) 0 (5) (75,000) 518,250 Total assets 2,541,701 1,172,034 355,966 1,528,000 (150,000) 3,919,701 LIABILITIES AND STOCKHOLDERS' EQUITY Accounts payable 144,437 509,330 (3) (509,330) 0 144,437 Accrued expenses and other 80,825 324,253 (3) (324,253) 0 80,825 Deferred revenue 0 75,000 (3) (75,000) 0 0 Notes payable- Current 104,629 785,202 (3) (785,202) 0 104,629 Long-term 41,412 90,260 (3) (90,260) 0 41,412 Stockholders' equity (deficit) 2,170,398 (612,011) (3) 612,011 0 (5)1,378,000 3,548,398 Total liabilities and stockholders' equity 2,541,701 1,172,034 (1,172,034) 0 1,378,000 3,919,701
SEE ACCOMPANYING NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET NOTES TO UNAUDITED PRO FORMA COMBINED BALANCE SHEET Note 1. This column includes the historical balance sheet of ADM Tronics Unlimited, Inc. as of June 30, 1998. Note 2. This column includes the historical balance sheet of the acquired business. As of August 18, 1998, the acquisition has been completed. Note 3. The transaction was consummated on August 18, 1998 whereby the Company purchased certain assets from EPI including, but not limited to, a number of "SofPulse" (the Device) medical devices along with certain manufacturing equipment, marketing rights, patents and other items associated with the Device, in exchange for $150,000 and the issuance of 2,925,000 shares of the Company's common stock. This column reflects adjustments to remove assets and liabilities from EPI's historical balance sheet not included as part of the purchase and to adjust assets acquired to fair value. Note 4. This column reflects assets acquired from EPI at estimated fair value. Note 5. This adjustment reflects the issuance of 2,925,000 shares of the Company's common stock and the $150,000 cash consideration pursuant to the transaction with EPI. The fair value of the assets acquired approximate the fair value of the common stock issued and accordingly, there was no goodwill to reflect incidental to the transaction. The Company agreed that if the shares had not been registered under the Securities Act by October 17, 1998, then on that day and on each thirty day anniversary thereof until the shares are so registered, if timely requested, the Company would purchase $20,000 worth of such shares based on a formula. In October, pursuant to a request, the Company purchased 37,647 shares pursuant to this provision of the agreement for $20,000. The Company's obligation to purchase shares is limited to an aggregate purchase price of $60,000 if such registration has not occurred due to circumstances not reasonably within the control of the Company. ADM TRONICS UNLIMITED, INC. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS THREE MONTHS ENDED JUNE 30, 1998 (1) (2) ADM TRONICS ACQUIRED PRO FORMA PRO FORMA UNLIMITED, INC. ENTITY ADJUSTMENTS COMBINED REVENUES 566,923 249,558 816,481 COSTS AND EXPENSES: Cost of sales 275,870 71,534 (3) 23,486 370,890 Selling, general and administrative 351,308 363,664 (4) (16,000) 698,972 Research and development 0 24,112 24,112 Other expenses 0 16,539 16,539 Total costs and expenses 627,178 475,849 7,486 1,110,513 LOSS BEFORE INCOME TAXES (60,255) (226,291) (7,486) (294,032) INCOME TAXES 0 0 0 0 LOSS (60,255) (226,291) (7,486) (294,032) Weighted average number of common and Equivalent shares outstanding 43,724,907 (5) 2,925,000 46,649,907 Loss per share (.001) (.006) SEE ACCOMPANYING NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS Note 1. This column includes the historical results of operations of ADM Tronics Unlimited, Inc. for the three month period ended June 30, 1998. Note 2. This column includes the historical results of operations of Electropharmacology, Inc. for the three months ended June 30, 1998. The historical data includes accounting fees of $65,000 and legal fees of $75,000. These amounts are excessive due to a business purchase the acquired entity was going to make and a law suit that is unrelated to the Sofpulse division of the acquired entity. Conservatively, accounting and legal fees for one year, exclusive of these items, would be $60,000 and $160,000, respectively. Prorated for a three month period the amounts would be $15,000 and $40,000, respectively. Also included in the historical data are research and development costs of $24,112, which the Company does not intend to continue as part of the business acquired. Interest expense of $16,539 was incurred by the acquired entity for the three months ended June 30, 1998. The Company did not acquire the debt of the acquired entity. Note 3. The adjustment represents the additional depreciation based on the assets acquired at fair market value for the three months ended June 30, 1998. Note 4. The adjustment represents the net effect of reducing the salary of an employee of the acquired entity who is now a consultant for the Company prorated for a three month period. The employee's salary was $139,000 per year and is now $75,000 per year. Note 5. Weighted average common and equivalent shares for the period ended June 30, 1998 have been calculated assuming the shares of common stock issued pursuant to the transaction were outstanding at the beginning of the period. Outstanding stock options and warrants have not been included in the calculation as its results would be anti-dilutive. Fully diluted (which approximates primary) weighted average common and equivalent shares outstanding, on a pro forma basis are as follows: Common shares outstanding-Historical 43,724,907 Common stock issued in connection with the business acquisition 2,925,000 46,649,907 ADM TRONICS UNLIMITED, INC. UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS YEAR ENDED MARCH 31, 1998 (1) (2) ADM TRONICS ACQUIRED PRO FORMA PRO FORMA UNLIMITED, INC. ENTITY ADJUSTMENTS COMBINED REVENUES 1,535,239 2,401,249 0 3,936,488 COSTS AND EXPENSES: Cost of sales 644,763 611,702 (3) 115,359 1,371,824 Selling, general and administrative 1,613,253 3,177,031 (4) (64,000) 4,726,284 Research and development 0 214,686 214,686 Other expenses 0 45,747 45,747 Total costs and expenses 2,258,016 4,049,166 51,359 6,358,541 LOSS INCOME TAXES (722,777) (1,647,917) (51,359) (2,422,053) INCOME TAXES 0 0 0 0 LOSS (722,777) (1,647,917) (51,359) (2,422,053) Weighted average number of common and Equivalent shares outstanding 42,477,832 (5) 2,925,000 45,402,832 Loss per share (.017) (.053) SEE ACCOMPANYING NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS NOTES TO UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS Note 1. This column includes the historical results of operations of ADM Tronics Unlimited, Inc. for the fiscal year ended March 31, 1998. Note 2. This column includes the historical results of operations of Electropharmacology, Inc. for the year ended March 31, 1998. The historical data includes accounting fees of $195,996 and legal fees of $713,965. These amounts are excessive due to a business purchase the acquired entity was going to make and a law suit that is unrelated to the Sofpulse division of the acquired entity. Conservatively, accounting and legal fees for one year, exclusive of these items, would be $60,000 and $160,000, respectively. Also included in the historical data are research and development costs of $214,686, which the Company does not intend to continue as part of the business acquired. Interest expense of $45,747 was incurred by the acquired entity for the three months ended June 30, 1998. The Company did not acquire the debt of the acquired entity. Note 3. The adjustment represents the additional depreciation based on the assets acquired at fair market value for the year ended March 31, 1998. Note 4. The adjustment represents the net effect of reducing the salary of an employee of the acquired entity who is now a consultant for the Company. The employee's salary was $139,000 per year and is now $75,000 per year. Note 5. Weighted average common and equivalent shares for the year ended March 31, 1998 have been calculated assuming the shares of common stock issued pursuant to the transaction were outstanding at the beginning of the period. Outstanding stock options and warrants have not been included in the calculation as its results would be anti-dilutive. Fully diluted (which approximates primary) weighted average common and equivalent shares outstanding, on a pro forma basis are as follows: Common shares outstanding-Historical 42,477,832 Common stock issued in connection with the business acquisition 2,925,000 45,402,832 (c) Not applicable. SIGNATURES Pursuant to the requirements of 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 hereunto duly authorized. ADM Tronics Unlimited, Inc. (Registrant) /s/ Dr. Alfonso Di Mino President -----END PRIVACY-ENHANCED MESSAGE-----