UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K/A
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): June 15, 1999
BERENS INDUSTRIES, INC.
------------------------------
(Exact name of registrant as specified in its charter)
NEVADA
------
(State or other jurisdiction of incorporation)
000-22711
---------
(Commission File Number) (I.R.S. Employer
Identification No.)
701 N. Post Oak Road, Suite 350, Houston, Texas 77024
-----------------------------------------------------
(Address of principal executive offices, including zip code)
(713) 682-7400
--------------
(Registrant's telephone number, including area code)
Item 1. Changes in Control of Registrant
Effective June 15, 1999, National Air Corporation, Inc., a Nevada
corporation ("Company"), acquired all of the issued and outstanding shares of
capital stock of Berensgallery.com, Inc., a Nevada corporation ("Subsidiary").
In connection with such acquisition, the Company issued an aggregate of
2,900,000 shares of authorized but unissued common stock, $0.001 par value, to
the shareholders of Subsidiary ("Shareholders"). The Shareholders exchanged an
aggregate of 2,900,000 shares of Subsidiary common stock for the 2,900,000
shares of Company common stock. Currently therewith, the Company issued 862,495
shares of common stock to certain consultants, for services rendered pursuant to
Regulation D of the Securities Act of 1933.
In connection with the reorganization, Nick Lovato, Kirsten Lovato and
Jeffrey Jenson resigned as directors and officers and were replaced by the
following: Marc I. Berens, Chairman of the Board of Directors, President, and
Chief Executive Officer; Yolana S. Berens, Director; and William Ranshaw,
Director. These persons will hold office until the next respective annual
meeting of the stockholders and directors or until their respective successors
have been elected and qualified or their prior resignations or terminations.
Upon the closing of the above-referenced transactions, there were
4,500,000 shares of Company common stock outstanding.
To the best of the Company's knowledge, there are no known arrangements
which may at a subsequent date result in a subsequent change in control of the
Company.
Item 2. Acquisition or Disposition of Assets
See Item 1 for discussion.
Item 3. Bankruptcy or Receivership
Inapplicable
Item 4. Changes in Registrant's Certifying Accountant
In connection with the above captioned acquisition, the Company changed
its certifying accountant from Mantyla, McReynolds & Associates to Ham, Langston
& Brezina, L.L.P. The dismissal of Mantyla, McReynolds & Associates was not the
result of any disagreements on any matter involving accounting principles or
practices, financial statement disclosure or auditing scope or procedure. The
engagement of Ham, Langston & Brezina, L.L.P. was approved by the Company's
board of directors.
Item 5. Other Events
Inapplicable.
Item 6. Resignations of Registrant's Directors
See Item 1 for discussion.
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Business Acquired.
The financial statements relating to the acquisition required
pursuant to Article 3-05 of Regulation S-X are attached hereto as
Annex A
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(b) Pro Forma Financial Information.
The pro forma financial information relating to the acquisition
required pursuant to Article II of Regulation S-X is attached hereto
as Annex B
(c) Exhibits
Plan of Reorganization.
Item 8. Change in Fiscal Year
Inapplicable
-3-
SIGNATURES
Pursuant to the requirements 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.
NATIONAL AIR CORPORATION, INC.
By: /s/ Marc I. Berens
______________________
Marc I. Berens
Chief Executive Officer
DATE: August 30, 1999
EXHIBITS
Exhibit
No. Page
- ------- ----
2.1 Plan of Reorganization........................... A-1(1)
(1) Previously filed on Form 8-K dated June 30, 1999, file number 00-22711
ANNEX A
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
__________
FINANCIAL STATEMENTS
WITH REPORT OF INDEPENDENT ACCOUNTANTS
FOR THE PERIOD FROM INCEPTION, FEBRUARY 26, 1999,
TO JUNE 15, 1999
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
TABLE OF CONTENTS
PAGE
----
Report of Independent Accountants 1
Financial Statements:
Balance Sheet as of June 15, 1999 2
Statement of Operations for the period
from inception, February 26, 1999,
to June 15, 1999 3
Statement of Stockholders' Deficit for
the period from inception, February 26,
1999, to June 15, 1999 4
Statement of Cash Flows for the period
from inception, February 26, 1999, to
June 15, 1999 5
Notes to Financial Statements 6-10
REPORT OF INDEPENDENT ACCOUNTANTS
---------------------------------
To the Stockholders and Directors
BerensGallery.com, Inc.
We have audited the accompanying balance sheet of BerensGallery.com, Inc. (a
corporation in the development stage) as of June 15, 1999, and the related
statements of operations, stockholders' deficit and cash flows for the period
from inception, February 26, 1999, to June 15, 1999. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based upon our audit.
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 present fairly, in
all material respects, the financial position of BerensGallery.com, Inc. as of
June 15, 1999, and the results of its operations and its cash flows for the
period from inception, February 26, 1999, to June 15, 1999, 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 shown in the financial statements
and discussed in Note 3, the Company has incurred a significant loss from
operations since inception and is dependent on outside sources of financing for
continuation of its operations. These factors raise substantial doubt about the
Company's ability to continue as a going concern. Management's plans with
regard to this matter are also discussed in Note 3. These financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
/s/ Ham, Langston & Brezina, L.L.P.
August 25, 1999
Houston, Texas
-1-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
BALANCE SHEET
JUNE 15, 1999
---------------
ASSETS
- ------
Current assets:
Cash and cash equivalents $ 25,778
---------
Total current assets 25,778
Advances to affiliates 40,640
---------
Total assets $ 66,418
=========
LIABILITIES AND STOCKHOLDERS' DEFICIT
- -------------------------------------
Current liabilities:
Federal withholding tax payable $ 10,560
Accrued professional fees 60,000
---------
Total current liabilities 70,560
---------
Commitment and contingencies
Stockholders' deficit:
Common stock, $.001 par value, 50,000,000
shares authorized, 2,900,000 shares issued
and outstanding 2,900
Additional paid-in capital 198,100
Subscription receivable (73,501)
Losses accumulated during the development
stage (131,641)
---------
Total stockholders' deficit (4,142)
---------
Total liabilities and stockholders'
deficit $ 66,418
=========
See notes to financial statements.
-2-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
STATEMENT OF OPERATIONS
FOR THE PERIOD FROM INCEPTION, FEBRUARY 26, 1999,
TO JUNE 15, 1999
-----------
Costs and expenses:
Salaries and wages $ 52,597
Legal and consulting fees 77,000
Other 2,044
-------
Net loss $(131,641)
========
See notes to financial statements.
-3-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
STATEMENT OF STOCKHOLDERS' DEFICIT
FOR THE PERIOD FROM INCEPTION, FEBRUARY 26, 1999,
TO JUNE 15, 1999
-------------------
LOSSES
ACCUMULATED
COMMON STOCK ADDITIONAL DURING THE
------------------- PAID-IN SUBSCRIPTION DEVELOPMENT
SHARES AMOUNT CAPITAL RECEIVABLE STAGE TOTAL
-------- -------- ---------- ------------ ----------- ---------
Balance at inception,
February 26, 1999 - $ - $ - $ - $ - $ -
Net proceeds from an initial
capitalization 2,900,000 2,900 198,100 (73,501) - 127,499
Net loss - - - - (131,641) (131,641)
--------- ------- ---------- ------------ ----------- ---------
Balance at June 15, 1999,
as restated 2,900,000 $ 2,900 $ 198,100 $ (73,501) $ (131,641) $ (4,142)
========= ======= ========== ============ =========== =========
See notes to financial statements.
-4-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM INCEPTION, FEBRUARY 26, 1999,
TO JUNE 15, 1999
--------------------
Cash flows from operating activities:
Net loss $(131,641)
Adjustments to reconcile net loss
to net cash used in operating
activities:
Changes in operating assets and
liabilities:
Increase in federal withholding
tax payable 10,560
Increase in accrued professional fees 60,000
---------
Net cash used in operating
activities (61,081)
---------
Cash flows from investing activities:
Advances to affiliates (40,640)
---------
Net cash used in investing
activities (40,640)
---------
Cash flows from financing activities:
Proceeds from sale of common stock 127,499
---------
Net cash provided by financing
activities 127,499
---------
Net increase in cash and cash equivalents 25,778
Cash and cash equivalents at beginning
of period -
---------
Cash and cash equivalents at end of
period $ 25,778
=========
See notes to financial statements.
-5-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
NOTES TO FINANCIAL STATEMENTS
__________
1: ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BerensGallery.com, Inc. is involved in the development of an online auction
site for sale of exclusive paintings and other art works. The Company is a
development stage enterprise because since its inception substantially all
its efforts have been devoted to Web site development and fund raising
activities. Following is a description of its significant accounting
policies:
SIGNIFICANT ESTIMATES
---------------------
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the dates of the financial statements
and the reported amounts of revenues and expenses during the periods. Actual
results could differ from estimates making it reasonably possible that a
change in the estimates could occur in the near term.
CASH AND CASH EQUIVALENTS
-------------------------
The Company considers all highly liquid short-term investments with an
original maturity of three months or less when purchased, to be cash
equivalents.
Continued
-6-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
__________
1: ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED
INCOME TAXES
------------
The Company uses the liability method of accounting for income taxes. Under
this method, deferred income taxes are recorded to reflect the tax
consequences on future years of temporary differences between the tax basis
of assets and liabilities and their financial amounts at year-end. The
Company provides a valuation allowance to reduce deferred tax assets to their
net realizable value.
FAIR VALUE OF FINANCIAL INSTRUMENTS
-----------------------------------
The Company includes fair value information in the notes to financial
statements when the fair value of its financial instruments is different from
the book value. When the book value approximates fair value, no additional
disclosure is made.
COMPREHENSIVE INCOME
--------------------
The Company has adopted Statement of Financial Accounting Standards ("SFAS")
No. 130, Reporting Comprehensive Income, which requires a company to display
an amount representing comprehensive income as part of the Company's basic
financial statements. Comprehensive income includes such items as unrealized
gains or losses on certain investment securities and certain foreign currency
translation adjustments. The Company's financial statements include none of
the additional elements that affect comprehensive income. Accordingly,
comprehensive income and net income are identical.
2. GOING CONCERN CONSIDERATIONS
Since its inception, as a development stage enterprise, the Company has not
generated any revenue and has been dependent on debt and equity raised from
individual investors to support its operations. During the period from
inception, February 26, 1999 to June 15, 1999, the Company incurred a net
loss of $(131,641) and negative cash flows from operations of $(61,081).
These factors raise substantial doubt about the Company's ability to continue
as a going concern.
Continued
-7-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
__________
2. GOING CONCERN CONSIDERATIONS, CONTINUED
In order to address its financial situation, management intends to undertake
a private placement of its common stock and to recapitalize into a dormant
public shell company. (See Note 6)
There can be no assurances that the Company's current cash reserves will be
adequate to sustain its operations nor that the Company can raise additional
cash through private placement of its common stock. The Company's long-term
viability as a going concern is dependent upon three key factors, as follows:
.The Company's ability to obtain adequate sources of debt or equity funding
to meet current commitments and fund the continuation of its business
operations.
.The ability of the Company to successfully make the transformation from a
development stage company to a commercially viable internet business.
.The ability of the Company to ultimately achieve adequate profitability and
cash flows from operations to sustain its operations.
3. ADVANCES TO AFFILIATES
----------------------
Advances to affiliates at June 15, 1999 represent amounts due from companies
under common control with the Company. These advances are non-interest
bearing and have no formal repayment schedule. Accordingly advances to
affiliates are included in other non-current assets.
Continued
-8-
BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
__________
4. INCOME TAXES
The composition of deferred tax assets and the related tax effects at June
15, 1999 were as follows:
Asset
-----
Benefit from carryforward of net
operating loss $ 44,758
Less valuation allowance (44,758)
---------
Net deferred tax asset $ -
=========
The difference between the income tax benefit in the accompanying statement
of operations and the amount that would result if the U.S. Federal statutory
rate of 34% were applied to pre-tax loss is as follows:
Benefit for income tax at
federal statutory rate $ 44,758 34.0%
Increase in valuation
allowance (44,758) (34.0)
-------- -----
Total $ - -
======== =====
At June 15 1999, for federal income tax and alternative minimum tax reporting
purposes, the Company has approximately $144,000 of unused net operating
losses available for carryforward to future years. The benefit from
carryforward of such net operating losses will expire in 2019. The benefit
from utilization of such net operating loss carryforwards incurred prior to
June 15, 1999 was significantly limited in connection with the Company's
merger with National Air Corporation, Inc. (See Note 6). Such benefit could
be subject to further limitations if significant future ownership changes
occur in the Company.
5. IMPACT OF THE YEAR 2000 ISSUE
The Year 2000 issue is the result of computer programs being written using
two digits rather than four to define the applicable year. Any of the
Company's computer programs that have time sensitive software may recognize a
date using "00" as the year 1900 rather than the year 2000. This could
result in a system failure or miscalculation causing a disruption of business
activities.
Continued
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BERENSGALLERY.COM, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
NOTES TO FINANCIAL STATEMENTS, CONTINUED
__________
5. IMPACT OF THE YEAR 2000 ISSUE
The Company has performed a complete assessment of the Year 2000 issue and
has determined that no significant modifications to its existing computer
software will be required and that its existing computer systems will
function properly with respect to dates in the year 2000 and thereafter. The
Company further believes that costs related to the Year 2000 issue will be
insignificant because the Company's systems have been designed to be Year
2000 compliant.
Based on the Company's assessment of its relationships with significant
suppliers to understand the extent to which the Company is vulnerable to any
failure by third parties to remedy their own Year 2000 issues, management
believes that the Company does not have significant exposure with respect to
third parties.
6. SUBSEQUENT EVENT - RECAPITALIZATION
Effective June 15, 1999 National Air Corporation was acquired by
BerensGallery.com in a recapitalization transaction accounted for similar to
a reverse acquisition, except that no goodwill was recorded. National Air
Corporation was the "acquired" company in the transaction, but remains the
surviving legal entity. Prior to the acquisition National Air Corporation was
a non-operating public shell corporation with no significant assets.
Accordingly, the transaction was treated as an issuance of stock by National
Air Corporation for BerensGallery.com, Inc.'s net monetary assets,
accompanied by a recapitalization. Since this transaction is in substance, a
recapitalization of BerensGallery.com and not a business combination, a
valuation was not performed.
7. NON-CASH INVESTING AND FINANCING ACTIVITIES
During the period from inception, February 26, 1999, to June 15, 1999, the
Company engaged in non-cash investing and financing transactions as follows:
Notes receivable received in
exchange for common stock of
the Company $ 73,501
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ANNEX B
NATIONAL AIR CORPORATION
PROFORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
__________
(UNAUDITED)
Effective June 15, 1999 National Air Corporation was acquired by
BerensGallery.com in a recapitalization transaction accounted for similar to a
reverse acquisition, except that no goodwill was recorded. National Air
Corporation was the "acquired" company in the transaction, but remains the
surviving legal entity. Prior to the acquisition National Air Corporation was a
non-operating public shell corporation with no significant assets. Accordingly,
the transaction was treated as an issuance of stock by National Air Corporation
for BerensGallery.com, Inc.'s net monetary assets, accompanied by a
recapitalization. In connection with this transaction, National Air Corporation
issued 2,900,000 new shares of common stock for all of the outstanding common
stock of BerensGallery.com, Inc. Since this transaction is in substance, a
recapitalization of BerensGallery.com and not a business combination, a
valuation was not performed.
The Unaudited Proforma Condensed Consolidated Financial Statements are presented
for informational purposes only and are not necessarily indicative of the
results of operations that would have been achieved had the transaction been
completed at January 1, 1999, nor are they indicative of the Company's future
results of operations.
The Unaudited Proforma Condensed Consolidated Financial Statements should be
read in conjunction with the historical financial statements of the Company and
related notes thereto.
11
NATIONAL AIR CORPORATION
PROFORMA CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1999
__________
(UNAUDITED)
NATIONAL BERENS-
AIR GALLERY.COM PROFORMA PROFORMA
ASSETS CORPORATION INC. ADJUSTMENTS CONSOLIDATED
------ ----------- ----------- ----------- ------------
Current assets:
Cash and cash equivalents $ - $ 1,000 $ - $ 1,000
----------- ----------- ----------- ------------
Total assets $ - $ 1,000 $ - $ 1,000
=========== =========== =========== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current liabilities:
Loans from stockholders $ 9,307 $ - $ - $ 9,307
-------- --------- --------- ---------
Total current liabilities 9,307 - - 9,307
-------- --------- --------- ---------
Stockholders' equity:
Common stock 738 2,900 - 3,638
Subscription receivable - (200,000) - (200,000)
Additional paid-in capital 57,469 198,100 (67,514)(a) 188,055
Losses accumulated during
the development stage (67,514) - 67,514 (a) -
-------- --------- --------- ---------
Total stockholders'
deficit (9,307) 1,000 - (8,307)
-------- --------- --------- ---------
Total liabilities and
stockholders' deficit $ - $ 1,000 $ - $ 1,000
======== ========= ========= =========
See notes to unaudited proforma
condensed financial statements.
12
NATIONAL AIR CORPORATION
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1999
__________
(UNAUDITED)
NATIONAL BERENS-
AIR GALLERY.COM PROFORMA PROFORMA
CORPORATION INC. ADJUSTMENTS CONSOLIDATED
------------ ----------- ----------- -------------
Revenue $ - $ - $ - $ -
General and administrative
expenses 1,543 - - 1,543
----------- ----------- ----------- ------------
Net loss $ (1,543) $ - $ - $ (1,543)
=========== =========== =========== ============
Net loss per share of common
stock $ (0.01) $ (0.00)
=========== ============
Weighted average shares
outstanding 737,505 $ 3,637,505
=========== ============
See notes to unaudited proforma
condensed financial statements.
13
NATIONAL AIR CORPORATION
NOTES TO UNAUDITED PROFORMA CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
Effective June 15, 1999 National Air Corporation was acquired by
BerensGallery.com in a recapitalization transaction accounted for similar to
a reverse acquisition, except that no goodwill was recorded. National Air
Corporation was the "acquired" company in the transaction, but remains the
surviving legal entity. Prior to the acquisition National Air Corporation
was a non-operating public shell corporation with no significant assets.
Accordingly, the transaction was treated as an issuance of stock by National
Air Corporation for BerensGallery.com, Inc.'s net monetary assets,
accompanied by a recapitalization. Since this transaction is in substance, a
recapitalization of BerensGallery.com and not a business combination, a
valuation was not performed.
The Company believes that the assumptions used in preparing the unaudited
proforma condensed consolidated financial statements provide a reasonable
basis for presenting all of the significant effects of the OnSite acquisition
(other than any synergies anticipated by the Company, and nonrecurring
charges directly attributable to the purchase and nonrecurring charges that
will result from consolidating operations), and that the proforma adjustments
give effect to those assumptions in the Unaudited Proforma Condensed
Consolidated Statements of Operations.
2. EARNINGS PER SHARE
Net loss per share of common stock was computed by dividing the net income
available to common stockholders by the weighted average number of shares of
common stock outstanding during the period. Due to the net loss, all of the
common stock equivalents were excluded from this calculation due to their
anti-dilutive effect.
3. PROFORMA ADJUSTMENTS
The proforma adjustment to the Unaudited Proforma Condensed Consolidated
Balance Sheet is as follows:
a. To reflect the recapitalization of BerensGallery.com, Inc., National
Air Corporation is the legal reporting entity, so the par value of
National Air Corporation's stock is presented. As the "acquiror", the
retained earnings of BerensGallery.com, Inc. is presented. The
resulting difference is reflected in additional paid-in capital. In
connection with this transaction, National Air Corporation issued
2,900,000 new common shares for all of the outstanding common stock of
BerensGallery.com, Inc.
Continued
14
NATIONAL AIR CORPORATION
NOTES TO UNAUDITED PROFORMA CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
3. PROFORMA ADJUSTMENTS, CONTINUED
There were no proforma adjustments to the Unaudited Proforma Condensed
Consolidated Statements of Operations.
15
SIGNATURES
Pursuant to the requirements 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.
NATIONAL AIR CORPORATION
Date: August 30, 1999 By: /s/ Marc I. Berens
--------------------------------