-----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, RHS/cKpdn/euRlYggxU55wsgR4LxCmBwIUN2yd8vZAMYBFjbULBmHAfiGHid1uPm MnPO5mA5GZ6vPvyU33cgFg== 0001013596-97-000002.txt : 19970117 0001013596-97-000002.hdr.sgml : 19970117 ACCESSION NUMBER: 0001013596-97-000002 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970115 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19970116 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SOLUTIONS INC CENTRAL INDEX KEY: 0000926844 STANDARD INDUSTRIAL CLASSIFICATION: BLANK CHECKS [6770] IRS NUMBER: 841273503 STATE OF INCORPORATION: NV FISCAL YEAR END: 0430 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-24512 FILM NUMBER: 97506690 BUSINESS ADDRESS: STREET 1: 6 VENTURE STE 207 CITY: IRVING STATE: CA ZIP: 92718 BUSINESS PHONE: 5187627527 MAIL ADDRESS: STREET 1: C/O BRYAN A GIANESIN STREET 2: 6 VENTURE SUITE 207 CITY: IRVINE STATE: CA ZIP: 92718 8-K/A 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A 4 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: January 15, 1997 (Amending Report Dated August 28, 1996) SUARRO COMMUNICATIONS, INC. (f/k/a/ SOLUTIONS, INCORPORATED) (Exact name of registrant as specified in its charter) NEVADA (State or other jurisdiction of incorporation) 0-23512 84-1273503 (Commission File No.) (IRS Employer Identification No.) 1635 N.E. Loop 410 Suite 900 San Antonio, Texas 78209 (Address of principal executive offices) Registrant's telephone number, including area code: (210) 805-0599 Page 1 of 14 pages. Item 7. Financial Statements and Exhibits. (a) Financial Statements of Business Acquired. (1) Suarro Communications, Inc. Restated Audited Financial Statements for the Fiscal Year Ended April 30, 1996, and for the interim period May 1, 1996 through August 16, 1996 (b) Pro Forma Financial Statements. (1) Restated Pro Forma Combined Balance Sheet dated August 16, 1996 and Notes thereto (unaudited) (2) Restated Pro Forma Combined Statements of Operations for the interim period from May 1, 1996 to August 16, 1996 and Notes thereto (unaudited) (c) Exhibits. All exhibits applicable were previously filed with the Form 8-K dated August 28, 1996, and Amendment No. 1 thereto dated September 6, 1996 2 R. E. Bassie & Co. Certified Public Accountants Suarro Communications, Inc. (A Development Stage Company) Financial Statements August 16, 1996 and April 30, 1996 (With Independent Auditors' Report Thereon) 3 Suarro Communications, Inc. (A Development Stage Company) Index Independent Auditors' Report Financial Statements: Balance Sheets - August 16, 1996 and April 30, 1996 Statement of Operations - For the period from May 1, 1996 to August 16, 1996 and for the year ended April 30, 1996, and for the period from August 18, 1988 (date of inception) to August 16, 1996 Statement of Stockholders' Equity - For the period from August 18, 1988 (date of inception) to August 16, 1996 Statements of Cash Flows - For the period from May 1, 1996 to August 16, 1996 and for the year ended April 30, 1996, and for the period from August 18, 1988 (date of inception) to August 16, 1996 Notes to Financial Statements All schedules have been omitted because they are not applicable, not required, or because the information is included in the financial statements or notes thereto. 4 R. E. Bassie & Co. Certified Public Accountants 7100 Regency Square Blvd., Suite 135 Houston, Texas 77036-3208 Tel: (713) 266-0691 Fax: (713) 266-0692 Independent Auditors' Report The Board of Directors Suarro Communications, Inc.: We have audited the financial statements of Suarro Communications, Inc. (a Development Stage Company) as listed in the accompanying index. 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 audit. The financial statements of Suarro Communications, Inc. as of April 30, 1996 and for the preceding periods were audited by other auditors whose report dated June 1, 1996 expressed an unqualified opinion on these statements. We conducted our audit 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 audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above presents fairly, in all material respects, the financial position of Suarro Communications, Inc. as of August 16, 1996, and the results of its operations and its cash flows for the period from May 1, 1996 to August 16, 1996, in conformity with generally accepted accounting principles. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 5 to the financial statements, the Company is a newly organized development stage corporation with limited capital. Successful development and marketing of the Company's products and the procurement of additional financing is necessary for the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. January 10, 1997 5 SUARRO COMMUNICATIONS, INC. (A Development Stage Company) Balance Sheets August 16, 1996 and April 30, 1996
August 16, April 30, Assets 1996 1996 ________ ________ Cash $ 113 1,870 Proprietary telecommunication and Internet costs (note 2) 0 0 ________ ________ Total assets $ 113 1,870 Liabilities and Stockholders' Equity Liabilities 0 0 ________ ________ Total liabilities 0 0 ________ ________ Stockholders' equity (notes 2 and 3): Preferred stock, no par value. Authorized 1,000,000 shares; issued and outstanding, 0 shares 0 0 Common stock, $.001 par value. Authorized 20,000,000 shares; issued and outstanding, 6,200,000 shares 6,200 6,200 Additional paid-in capital (discount) (2,048) (2,048) Deficit accumulated during the development stage (4,039) (2,282) ________ ________ Total stockholders' equity 113 1,870 ________ ________ Total liabilities and stockholders' equity $ 113 1,870 See accompanying notes to financial statements.
6 SUARRO COMMUNICATIONS, INC. (A Development Stage Company) Statements of Operations For the period from May 1, 1996 to August 16, 1996, and the year ended April 30, 1996, and the period from August 18, 1988 (date of inception) to August 16, 1996
August 18, May 1, 1988 1996 to Year ended (inception) to August 16, April 30, August 16, 1996 1996 1996 __________ __________ __________ Revenue $ 0 0 0 Expenses 1,757 1,782 4,039 __________ __________ __________ Net loss $ (1,757) (1,782) (4,039) See accompanying notes to financial statements.
7 SUARRO COMMUNICATIONS, INC. (A Development Stage Company) Statement of Stockholders' Equity For the period from August 18, 1988 (date of inception) to August 16, 1996
Deficit Additional Accumulated Paid-in during the Total Preferred Common Capital Development Stockholders' Stock Stock (Discount) Stage Equity ________ ________ __________ ___________ ____________ Balance, August 18, 1988 $ 0 0 0 0 0 Issuance of 50,000 shares of common stock 0 50 2,232 0 2,282 Stock split, 20 to 1 0 950 (950) 0 0 Issuance of 5,200,000 shares of common stock 0 5,200 (3,330) 0 1,870 Net loss 0 0 0 (4,039) (4,039) ________ ________ __________ ___________ ____________ Balance, August 16, 1996 $ 0 6,200 (2,048) (4,039) 113 See accompanying notes to financial statements.
8 SUARRO COMMUNICATIONS, INC. (A Development Stage Company) Statements of Cash Flows For the period from May 1, 1996 to August 16, 1996, and the year ended April 30, 1996, and the period from August 18, 1988 (date of inception) to August 16, 1996
August 18, May 1, 1988 1996 to Year ended (inception) to August 16, April 30, August 16, 1996 1996 1996 _________ _________ _________ Cash flows from operating activities: Deficit accumulated during the development stage $ (1,757) (1,782) (4,039) Service provided in exchange for stock 0 0 500 _________ _________ _________ Net cash provided by operating activities (1,757) (1,782) (3,539) Cash flows from investing activities 0 0 0 Cash flows from financing activities 0 3,652 3,652 _________ _________ _________ Net increase (decrease) in cash (1,757) 1,870 113 _________ _________ _________ Cash, beginning of period 1,870 0 0 _________ _________ _________ Cash, end of period $ 113 1,870 113 Supplemental disclosures: Noncash investing and financing activities (note 2) See accompanying notes to financial statements.
9 SUARRO COMMUNICATIONS, INC. (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS August 16, 1996 (1) Organization Suarro Communications, Inc. (the Company), a Nevada corporation, was incorporated on August 18, 1988. The Company was formed as a consolidation vehicle for the purpose of delivering cost effective national on-line business services and products through the Internet. The Company acquired proprietary telecommunication products developed for the Internet from the two common stock shareholders. The Company is in the process of initiating the marketing of its first product, Annual Reports On-Line, as well as other Internet related products. To date there have been no sales orders. (2) Merger Effective August 16, 1996, the Company acquired all of the outstanding common stock of Suarro Communications, Inc. by issuing 5,200,000 shares of its authorized common stock. As a result of the consummation of this share exchange, the Company undertook a forward split of its common stock whereby 20 shares of common stock was issued in exchange for 1 share of common stock, increased its authorized capitalization to 20,000,000 shares of common stock and authorized 1,000,000 shares of preferred stock, and changed its name to Suarro Communications, Inc. The merger was accounted for by the "pooling of interests" method of accounting. (3) Proprietary Telecommunication and Internet Costs The costs of developing the proprietary telecommunication and Internet products were incurred prior to incorporation of the Company. Material and contract services totaling $149,982 were paid by two individuals or their wholly-owned company. In addition, the shareholders valued their personal time in producing the technology at $328,000. Upon incorporation, the Company originally recorded as an asset $349,382 of these costs as proprietary telecommunication and Internet costs. The remaining $128,600 ($8,600 in paid expenses and $120,000 of the shareholders' personal time) of the total cost was not recorded as an asset because this amount was originally considered to be the only amount incurred as research and development costs. The $349,382 was originally capitalized because management concluded that technological feasibility had been established after incurring the research and 10 SUARRO COMMUNICATIONS, INC. (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS August 16, 1996 development expenses. Management's subsequent evaluation of the development process changed its original conclusion as to the date that technological feasibility had been established; therefore, all costs incurred prior to incorporation ($477,982) were expensed as research and development expenses. Accordingly, the financial statements were restated to reflect the following changes:
As Previously reported (Decrease) As restated _________ ________ _________ August 16, 1996: Proprietary tele- communication and Internet costs $ 349,382 (349,382) 0 Additional paid- in capital (discount) $ 347,334 (349,382) (2,048)
(4) Development Stage Operations The Company is currently in the developmental stage and has no significant operations to date. (5) Going Concern The Company is a newly organized development stage corporation that has not commenced operations as of August 16, 1996. This factor, together with its limited capital, among others, indicate that the Company may be unable to continue its operations without successful development and marketing of the Company's products and the procurement of additional financing. The accompanying financial statements have been prepared on the assumption that the Company will continue in business, which contemplates the realization of assets through continuing operations. No adjustments have been made to reflect potentially lower realizable value of assets should the Company be unable to continue its operations, as the outcome of the above matter is not currently determinable. 11 Pro Forma Combined Balance Sheet The following pro forma combined balance sheet presents, under the "pooling of interest" method of accounting, the balance sheet of Solutions, Incorporated as of August 16, 1996, combined with the balance sheet of Suarro Communications, Inc, as of August 16, 1996. SUARRO COMMUNICATIONS, INC. (A Development Stage Company) PRO FORMA COMBINED BALANCE SHEET August 16, 1996
Suarro Solutions, Communications Adjustments Incorporated Inc, (a) (b) Pro Forma ____________ ____________ ____________ __________ Cash $ 0 113 113 Proprietary tele- communications and Internet costs 0 0 0 ____________ ____________ ____________ __________ Total Assets $ 0 113 0 113 Liabilities 0 0 0 0 ____________ ____________ ____________ __________ Total Liabilities 0 0 0 0 ____________ ____________ ____________ __________ Stockholders' equity: Preferred stock 0 0 0 Common stock 50 1,870 4,280 6,200 Additional paid- in capital 2,232 0 (4,280) (2,048) Deficit accumulated during the development stage (2,282) (1,757) (4,039) ____________ ____________ ____________ __________ Total stockholders equity 0 113 0 113 ____________ ____________ ____________ __________ Total liabilities and stockholders equity $ 0 113 0 113 ____________________ Notes to Pro Forma Combined Financial Statements (a) Solutions, Incorporated amended its articles of Incorporation in May 1996 to increase its authorized stock to 20,000,000 shares. Solutions, Incorporated had a twenty to one stock split resulting in an increase of its outstanding shares from 50,000 to 1,000,000. (b) Solutions, Incorporated issued 5,200,000 shares of common stock in exchange for the 300,000 outstanding shares of Suarro Communications, Inc. The transaction was accounted for using the "pooling of interest" method of accounting.
12 Pro Forma Combined Statements of Operations The following pro forma combined statements of operations presents, under the "pooling of interest" method of accounting, the statement of operations of Solutions, Incorporated for the period from May 1, 1996 to August 16, 1996, combined with the statement of operations of Suarro Communications, Inc. for the period from March 16, 1996 to August 16, 1996. SOLUTIONS, INCORPORATED. (A Development Stage Company) PRO FORMA COMBINED STATEMENT OF OPERATIONS FOR THE PERIOD FROM MAY 1, 1996 TO AUGUST 16, 1996
Suarro Solutions, Communications Adjustments Incorporated Inc, (a) (b) Pro Forma ____________ ____________ ____________ __________ Sales and Revenue $ 0 0 0 Costs and expenses 0 0 0 Cost of Sales 0 0 0 Selling, general and administrative 0 1,757 1,757 Research and development 0 0 0 Other expenses 0 0 0 ------------ ------------ ------------ ---------- Net loss before income taxes 0 0 0 (1,757) Income taxes 0 0 0 0 ____________ ____________ ____________ __________ Net Loss $ 0 0 0 (1,757) Net loss per common share $ 0(a) (0.0003) - (0.0003) ____________________ Notes to Pro Forma Combined Financial Statements (a) Based on Solutions, Incorporated average shares outstanding of 1,000,000 and issuance of 5,200,000 shares to acquire Suarro Communications, Inc.
13 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 the registrant has duly caused this amended report to be signed on its behalf by the undersigned hereunto duly authorized. SUARRO COMMUNICATIONS, INC. f/k/a SOLUTIONS, INCORPORATED By: /s/ Michael McAuliffe Michael McAuliffe, President Dated: January 15, 1997 14 -----END PRIVACY-ENHANCED MESSAGE-----