SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): April 13, 2001
VITRIX, INC.
(Exact Name of Registrant as Specified in Charter)
Nevada 001-10320 13-3465289
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation Identification No.)
51 West Third Street, Suite 310, Tempe, Arizona 85281
(Address of Principal Executive Offices) (Zip Code)
(480) 967-5800
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
The financial statements and schedules for Time America, Inc.
previously omitted from the Form 8-K filed on April 13, 2001 are included
herewith commencing on page F-1.
(b) PRO FORMA FINANCIAL INFORMATION
See (a) above
(c) EXHIBITS
None
2
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.
VITRIX, INC.
Date: June 12, 2001 By /s/ Craig J. Smith
-------------------------------------
Craig J. Smith
Chief Financial Officer
3
INDEPENDENT AUDITORS' REPORT
TO THE STOCKHOLDERS AND BOARD OF DIRECTORS OF
Time America, Inc.
We have audited the accompanying balance sheet of Time America, Inc. as of June
30, 2000 and the related statements of operations, changes in stockholder's
equity (deficit), and cash flows for the years ended June 30, 2000 and 1999.
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 audits 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 Time America, Inc.. as of June
30, 2000, and the results of its operations, changes in stockholder's equity
(deficit), and cash flows for the years ended June 30, 2000 and 1999, in
conformity with generally accepted accounting principles.
Certified Public Accountants /s/ Semple & Cooper, LLP
Phoenix, Arizona
JUNE 6, 2001
F-1
TIME AMERICA, INC.
BALANCE SHEETS
JUNE 30, MARCH 31,
2000 2001
----------- -----------
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents (Note 1) $ 16,167 $ 29,050
Accounts receivable - trade, net (Note 1) 286,287 479,275
Inventory (Note 1) 150,356 174,082
Prepaid expenses and other current assets 43,438 28,963
----------- -----------
TOTAL CURRENT ASSETS 496,248 711,370
PROPERTY AND EQUIPMENT, NET (NOTES 1 AND 2) 185,690 55,725
----------- -----------
TOTAL ASSETS $ 681,938 $ 767,095
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
Current portion of long-term debt (Note 3) $ 744,309 $ 56,901
Accounts payable - trade 225,759 270,934
Accounts payable - related party (Notes 3 and 4) 131,483 17,153
Accrued liabilities 1,290 38,193
Deferred revenue (Note 1) 23,734 18,895
----------- -----------
TOTAL CURRENT LIABILITIES 1,126,575 402,076
LONG-TERM DEBT, LESS CURRENT PORTION (NOTE 3) -- 363,099
----------- -----------
TOTAL LIABILITIES 1,126,575 765,175
----------- -----------
COMMITMENTS: (NOTE 4) -- --
STOCKHOLDERS' EQUITY (DEFICIT):
Common stock, no par value, 25,000,000 shares
authorized, 2,034,410 shares issued and outstanding 2,035,880 2,730,960
Accumulated deficit (2,480,517) (2,729,040)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY (DEFICIT) (444,637) 1,920
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 681,938 $ 767,095
=========== ===========
The Accompanying Notes are an Integral Part
of the Financial Statements
F-2
TIME AMERICA, INC.
STATEMENTS OF OPERATIONS
NINE MONTH PERIOD
YEARS ENDED JUNE 30, ENDED MARCH 31,
---------------------------- ----------------------------
2000 1999 2001 2000
----------- ----------- ----------- -----------
(Unaudited)
Revenues:
Product sales $ 2,379,746 $ 1,716,975 $ 1,884,678 $ 1,812,146
Services revenue 271,967 286,266 184,208 235,045
----------- ----------- ----------- -----------
TOTAL REVENUES 2,651,713 2,003,241 2,068,886 2,047,191
----------- ----------- ----------- -----------
COST OF REVENUES:
Product 1,033,445 758,606 834,454 764,711
Services 280,649 197,974 216,469 204,055
----------- ----------- ----------- -----------
TOTAL COST OF REVENUES 1,314,094 956,580 1,050,923 968,766
----------- ----------- ----------- -----------
GROSS PROFIT 1,337,619 1,046,661 1,017,963 1,078,425
----------- ----------- ----------- -----------
COSTS AND EXPENSES:
Sales and marketing 378,655 301,066 232,223 273,454
Research and development 649,318 472,826 474,348 474,066
General and administrative 512,293 349,961 386,524 374,793
Impairment of asset (Note 2) -- -- 83,080 --
----------- ----------- ----------- -----------
TOTAL COSTS AND EXPENSES 1,540,266 1,123,853 1,176,175 1,122,313
----------- ----------- ----------- -----------
NET LOSS FROM OPERATIONS (202,647) (77,192) (158,212) (43,888)
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE):
Interest expense (28,570) (32,553) (34,620) (25,544)
Loss on disposal of fixed assets -- -- (62,739) --
Other 367 (36,283) 7,048 296
----------- ----------- ----------- -----------
(28,203) (68,836) (90,311) (25,248)
----------- ----------- ----------- -----------
NET LOSS $ (230,850) $ (146,028) $ (248,523) $ (69,136)
=========== =========== =========== ===========
The Accompanying Notes are an Integral Part
of the Financial Statements
F-3
TIME AMERICA, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE YEARS ENDED JUNE 30, 2000 AND 1999
AND THE NINE MONTH PERIOD ENDED MARCH 31, 2001 (Unaudited)
COMMON STOCK
---------------------------- ACCUMULATED
SHARES AMOUNT DEFICIT TOTAL
----------- ----------- ----------- -----------
Balance at July 1, 1998 2,034,410 $ 1,942,416 $(2,103,639) $ (161,223)
Contribution -- 93,464 -- 93,464
Net loss -- -- (146,028) (146,028)
----------- ----------- ----------- -----------
Balance at June 30, 1999 2,034,410 2,035,880 (2,249,667) (213,787)
Net loss -- -- (230,850) (230,850)
----------- ----------- ----------- -----------
Balance at June 30, 2000 2,034,410 2,035,880 (2,480,517) (444,637)
Contribution of debt from a related party -- 695,080 -- 695,080
Net loss -- -- (248,523) (248,523)
----------- ----------- ----------- -----------
Balance at March 31, 2001 2,034,410 $ 2,730,960 $(2,729,040) $ 1,920
=========== =========== =========== ===========
The Accompanying Notes are an Integral Part
of the Financial Statements
F-4
TIME AMERICA, INC.
STATEMENTS OF CASH FLOWS
NINE MONTH PERIOD
YEARS ENDED JUNE 30, ENDED MARCH 31,
------------------------- -------------------------
2000 1999 2001 2000
--------- --------- --------- ---------
(Unaudited)
INCREASE (DECREASE) IN CASH AND AND CASH EQUIVALENTS:
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $(230,850) $(146,028) $(248,523) $ (69,136)
Adjustments to reconcile net loss to net
cash used by operating activities:
Depreciation 27,727 25,140 20,926 20,022
Loss on disposal of fixed assets -- -- 62,739 --
Impairment of asset 83,080
Contribution of related party accounts payable -- -- 165,780 --
Changes in Assets and Liabilities:
Accounts receivable-trade (17,440) (8,071) (192,988) (36,624)
Inventory 49,316 (121,544) (23,726) (1,042)
Prepaid expenses and other current assets (24,730) 39,341 14,475 (21,262)
Accounts payable - trade 8,744 145,557 45,175 60,366
Accounts payable - related party 68,600 62,883 (114,330) 51,450
Accrued liabilities 943 (75) 36,903 (922)
Deferred revenue 28,326 (17,878) (4,839) 27,646
--------- --------- --------- ---------
NET CASH USED BY OPERATING ACTIVITIES (89,364) (20,675) (155,328) 30,498
--------- --------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (124,819) (41,665) (36,780) (110,686)
--------- --------- --------- ---------
NET CASH PROVIDED BY INVESTING ACTIVITIES (124,819) (41,665) (36,780) (110,686)
--------- --------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds form long-term debt 200,000 -- 204,991 100,000
Repayment of long-term debt -- (3) -- --
Contributions to equity -- 93,464 -- --
--------- --------- --------- ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES 200,000 93,461 204,991 100,000
--------- --------- --------- ---------
Net change in cash and cash equivalents (14,183) 31,121 12,883 19,812
Cash and cash equivalents at beginning of period 30,350 (771) 16,167 30,350
--------- --------- --------- ---------
Cash and cash equivalents at end of period $ 16,167 $ 30,350 $ 29,050 $ 50,162
========= ========= ========= =========
.SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest paid $ 28,570 $ 32,553 $ 34,620 $ 25,544
========= ========= ========= =========
NONCASH INVESTING AND FINANCING ACTIVITIES:
Contribution of long-term debt $ -- $ -- $ 529,300 $ --
========= ========= ========= =========
The Accompanying Notes are an Integral Part
of the Financial Statements
F-5
TIME AMERICA, INC.
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, NATURE OF OPERATIONS
AND USE OF ESTIMATES:
- --------------------------------------------------------------------------------
NATURE OF BUSINESS:
Time America, Inc. (the Company), provides Time & Labor Management Solutions
throughout the United States. Time America, Inc. products improve productivity
by automating Time and Attendance, Workforce Scheduling, and the management of
Labor Resources, with features such as employee self-service, data capture
technology, time sheet submittal, strategic reporting, and interface tools for
payroll, human resources, resource planning, and third party application
integration. Time America, Inc. is an Arizona corporation formed on February 10,
1988.
INTERIM FINANCIAL INFORMATION:
The interim financial statements for the nine month periods ended March 31, 2001
and 2000 are unaudited. In the opinion of management, such statements reflect
all adjustments (consisting only of normal recurring adjustments) necessary for
a fair representation of the results of the interim period. The results of
operations for the nine month period March 31, 2001 are not necessarily
indicative of the results for the entire year.
PERVASIVENESS OF 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 date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
CASH AND CASH EQUIVALENTS:
Cash and cash equivalents are considered to be all highly liquid investments
purchased with an initial maturity of three (3) months or less.
ACCOUNTS RECEIVABLE - TRADE:
The Company provides for potentially uncollectible accounts receivable by use of
the allowance method. The allowance is provided based upon a review of the
individual accounts outstanding, and the Company's prior history of
uncollectible accounts receivable. As of June 30, 2000 and March 31, 2001
provisions for uncollectible accounts have been established in the amounts of
$26,892 and $30,000 (unaudited), respectively.
INVENTORY:
Inventory is stated at the lower of cost (first-in, first-out method) or market.
F-6
TIME AMERICA, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, NATURE OF OPERATIONS
AND USE OF ESTIMATES: (CONTINUED)
- --------------------------------------------------------------------------------
PROPERTY AND EQUIPMENT:
Property and equipment are recorded at cost. Depreciation is provided for on the
straight-line method over the estimated useful lives of the assets. The average
lives range from three to five years. Maintenance and repairs that neither
materially add to the value of the property nor appreciably prolong its life are
charged to expense as incurred. Betterments or renewals are capitalized when
incurred. Property and equipment are reviewed each year to determine whether any
events or circumstances indicate that the carrying amount of the assets may not
be recoverable. Such review includes estimating future cash flows. Property and
equipment costs are expensed when determined not realizable.
SOFTWARE DEVELOPMENT COSTS:
The Company capitalizes software development costs in accordance with Statement
of Financial Accounting Standards No. 86, "Accounting for the Costs of Computer
Software to be Sold, Leased, or Otherwise Marketed." Capitalization of software
development costs begins upon the establishment of technological feasibility of
the product. The establishment of technological feasibility and the ongoing
assessment of the recoverability of these costs requires considerable judgement
by management with respect to certain external factors including, but not
limited to, anticipated future gross product revenue, estimated economic life,
and changes in software and hardware technology. Amortization of capitalized
software development costs begins when the products are available for general
release to customers and is computed on a product-by-product basis using
straight-line amortization with useful lives of five years or, if less, the
remaining estimated economic life of the product. Amounts related to internal
software development that could be capitalized under this statement were
immaterial.
REVENUE RECOGNITION AND DEFERRED REVENUE:
The Company derives its revenues from the sale of frontline labor management
systems as well as sales of application software, parts and components. The
Company's systems consist of fully integrated software and intelligent data
collection terminals. The Company also derives revenues by providing
maintenance, professional and educational services to its direct customers. The
Company recognizes revenues from sales of its systems, application software,
parts and components at the time of shipment, unless the Company has significant
obligations remaining. When significant obligations remain, revenue is not
recognized until such obligations have been completed or are no longer
significant. The Company recognizes revenues from its sales-type leases of
systems at time of shipment. Service revenues are recognized ratably over the
contractual period or as the services are performed.
The Company provides installation services and certain warranties to its
customers. It also provides, without additional charge, certain software product
enhancements for customers covered under software maintenance contracts. The
provision for these expenses are made at the time revenues are recognized.
INCOME TAXES:
For federal tax reporting purposes, the Company operates as a Sub-Chapter S
Corporation. As such, all taxable income and available tax credits are passed
from the corporate entity to the individual stockholders. It is the
responsibility of the individual stockholders to report the taxable income and
tax credits, and to pay any resulting income taxes. Accordingly, no provisions
were made for federal and state income taxes payable or refundable in the
accompanying financial statements.
F-7
TIME AMERICA, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, NATURE OF OPERATIONS
AND USE OF ESTIMATES: (CONTINUED)
- --------------------------------------------------------------------------------
FAIR VALUE OF FINANCIAL INSTRUMENTS:
The carrying values of cash, cash equivalents, accounts receivable, accounts
payable, accrued liabilities and current notes payable approximate their fair
values because of the short maturity of these instruments. With respect to
long-term debt, based on the borrowing rates currently available to the Company
for similar bank and equipment loans and capitalized leases, the amounts
reported approximate the fair value of the respective financial instruments.
RECENT ACCOUNTING PRONOUNCEMENTS:
In December 1999, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin ("SAB") No. 101 "Revenue Recognition" which provides
guidance on the recognition, presentation and disclosure of revenue in financial
statements filed with the SEC. The Company was required to be in conformity with
the provisions of SAB 101, as amended by SAB 101B, no later than October 1,
2000. The Company believes the adoptions of SAB 101, as amended by SAB 101B, has
not had a material effect on the financial position, results of operations or
cash flows of the Company for the periods presented.
In March 2000, the Financial Accounting Standards Board issued Interpretation
No. 44 ("FIN 44") Accounting for Certain Transactions Involving Stock
Compensation, an Interpretation of APB Opinion No. 25. FIN 44 clarifies the
application of Opinion No. 25 for (a) the definition of employee for purposes of
applying Opinion No. 25, (b) the criteria for determining whether a plan
qualifies as a non-compensatory plan, (c) the accounting consequences of various
modifications to the terms of a previously fixed stock option or award, and (d)
the accounting for an exchange of stock compensation awards in a business
combination. FIN 44 is effective July 2, 2000, but certain conclusions cover
specific events that occur after either December 15, 1998, or January 12, 2000.
The Company believes that the impact of FIN 44 will not have a material effect
on the Company's financial position.
- --------------------------------------------------------------------------------
NOTE 2
PROPERTY AND EQUIPMENT:
- --------------------------------------------------------------------------------
Property and equipment consists of:
JUNE 30, MARCH 31,
2000 2001
--------- ---------
(Unaudited)
Computers, software and equipment $ 386,915 $ 102,018
Furniture and fixtures 42,742 7,079
Leasehold improvements 50,733 --
--------- ---------
480,390 109,097
Less: accumulated depreciation (294,700) (53,372)
--------- ---------
$ 185,690 $ 55,725
========= =========
Depreciation expense was $27,727 and $25,140, respectively, for the years ended
June 30, 2000 and 1999 and $20,926 and 20,022, respectively, for the nine months
ended March 31, 2001 and 2000. (Unuadited)
F-8
TIME AMERICA, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
NOTE 2
PROPERTY AND EQUIPMENT:
(CONTINUED)
- --------------------------------------------------------------------------------
On March 31, 2001, software was deemed to be impaired and written down to fair
value. Fair value, which was determined by reference to the present value of the
estimated future cash inflows of the software, exceeded its carrying value by
$83,080. An impairment loss of that amount has been charged to operations during
the nine months ended March 31, 2001.
- --------------------------------------------------------------------------------
NOTE 3
LONG-TERM DEBT:
- --------------------------------------------------------------------------------
Long-term debt consists of the following:
JUNE 30, MARCH 31,
2000 2001
--------- ---------
(Unaudited)
Promissory note to the majority shareholder,
interest at prime plus 1 percent, monthly
interest only payments through November 2001
followed by twelve monthly principal and
interest payments of approximately $9,000
Due in full in October 2002 $ -- $ 400,000
Line of credit due to the majority shareholder,
interest at prime plus 1 percent. Due on demand 344,309 20,000
$400,000 line of credit with M&I First American
Bank, interest at the prime rate, secured by all
assets of the Company; guaranteed by the majority
shareholder, due April 30, 2001 400,000 --
--------- ---------
744,309 420,000
Less: current portion (744,309) (56,901)
--------- ---------
Long-term debt $ -- $ 363,099
========= =========
On December 31, 2000, the majority shareholder contributed $529,300 of debt and
accrued interest owed to him. In addition, the majority shareholder contributed
$165,780 of amounts owed for past due rent obligations.
On March 31, 2001 the majority shareholder assumed the $400,000 line of credit
from M&I Bank and entered into a debt agreement with the Company for $400,000 as
described above.
F-9
TIME AMERICA, INC.
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------
NOTE 3
LONG-TERM DEBT:
(CONTINUED)
- --------------------------------------------------------------------------------
Future minimum payments due under the long-term debt agreements are as follows:
YEAR ENDING YEAR ENDING
YEAR JUNE 30, MARCH 31,
---- -------- --------
(Unaudited)
2001 $744,309 $ --
2002 -- 56,901
2003 -- 363,099
-------- --------
Total $744,309 $420,000
======== ========
- --------------------------------------------------------------------------------
NOTE 4
COMMITMENTS:
- --------------------------------------------------------------------------------
The Company currently leases office equipment and services under non-cancelable
operating lease agreements which expire through June 2005. For the years ended
June 30, 2000 and 1999, expense under the aforementioned non-cancelable
operating lease agreements was approximately $7,845 and $0, respectively, and
$14,460 and $0, respectively, for the nine months ended March 31, 2001 and 2000.
(Unaudited)
Future minimum lease payments due under the operating lease agreements is as
follows:
YEAR ENDING YEAR ENDING
YEAR JUNE 30, MARCH 31,
---- -------- --------
(Unaudited)
2001 $ 19,279 --
2002 19,279 19,279
2003 19,279 19,279
2004 19,279 19,279
2005 12,261 14,600
2006 -- 2,480
-------- --------
$ 89,377 $ 74,917
======== ========
The Company leased it facilities from the majority shareholder under a
month-to-month agreement which was terminated on March 31, 2001. For the years
ended June 30, 2000 and 1999, expense under the aforementioned non-cancelable
operating lease agreements was approximately $68,600 each year, and $51,450 for
the nine months ended March 31, 2001 and 2000. (Unaudited)
F-10
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
The following unaudited pro forma condensed consolidated financial statements
give effect to the merger of Vitrix, Inc. (Vitrix) and Time America, Inc. (Time
America) pursuant to the terms of the Merger Agreement, dated March 28, 2001
(the "Merger Agreement"), by and among Vitrix, Time America and Vitrix
Incorporated, a wholly owned subsidiary of Vitrix ("Merger Sub").
Pursuant to the terms of the Merger Agreement, Time America merged with and into
Merger Sub, with Merger Sub continuing as the surviving corporation. In
connection with the acquisition, Vitrix's shareholders approved a proposal
effecting a 1-for-10 reverse stock split. Vitrix acquired all of the outstanding
shares of Time America through the issuance of 3,147,914 shares (on a post
reverse stock split basis) of Vitrix common stock, which amount represents
approximately fifty percent (50%) of Vitrix's outstanding common stock after
giving effect to the share issuance.
The terms of the transaction, including the purchase price, were determined by
negotiations between Vitrix and the principal shareholders of Time America, and
were approved by a majority of the shareholders of Time America.
The pro forma financial information is based on the pooling method of
accounting. The pro forma entries are described in the accompanying footnotes to
the unaudited pro forma condensed consolidated financial statements. The pro
forma unaudited condensed consolidated statements of operations assume the
merger took place on the first day of the period presented, while the unaudited
condensed consolidated balance sheets assume the merger took place on the
balance sheet date.
F-11
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
June 30, 2000
Pro Forma Financial Information:
The following represents a pro forma condensed consolidated balance sheet as of
June 30, 2000 assuming the Company's merger with Time America, Inc. through the
issuance of 3,147,914 shares of common stock, and accounted for under the
pooling method, was consummated as of that date.
ASSETS
PRO FORMA
TIME CONSOLIDATED
VITRIX, INC. AMERICA, INC. AMOUNTS
----------- ----------- -----------
Current Assets:
Cash and cash equivalents $ 620,765 $ 16,167 $ 636,932
Accounts receivable - trade 229,717 286,287 516,004
Inventory 91,204 150,356 241,560
Other current assets 38,182 43,438 81,620
----------- ----------- -----------
Total Current Assets 979,868 496,248 1,476,116
Property and equipment, net 168,779 185,690 354,469
----------- ----------- -----------
Total Assets $ 1,148,647 $ 681,938 $ 1,830,585
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Current portion of long-term debt $ 46,303 $ 744,309 $ 790,612
Accounts payable 88,953 357,242 446,195
Accrued liabilities 145,143 1,290 146,433
Deferred revenue 152,307 23,734 176,041
----------- ----------- -----------
Total Current Liabilities 432,706 1,126,575 1,559,281
----------- ----------- -----------
Long-term debt, less current portion 34,231 -- 34,231
----------- ----------- -----------
Stockholders' Equity (Deficit) 681,710 (444,637) 237,073
----------- ----------- -----------
Total Liabilities and Stockholders' Equity (Deficit) $ 1,148,647 $ 681,938 $ 1,830,585
=========== =========== ===========
F-12
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
March 31, 2001
Pro Forma Financial Information:
The following represents a pro forma condensed consolidated balance sheet as of
March 31, 2001 assuming the Company's merger with Time America, Inc. through the
issuance of 3,147,914 shares of common stock, and accounted for under the
pooling method, was consummated as of that date.
ASSETS
PRO FORMA
TIME CONSOLIDATED
VITRIX, INC. AMERICA, INC. AMOUNTS
----------- ----------- -----------
Current Assets:
Cash and cash equivalents $ 23,016 $ 29,050 $ 52,066
Accounts receivable - trade 178,714 479,275 657,989
Inventory 61,890 174,082 235,972
Other current assets 28,019 28,963 56,982
----------- ----------- -----------
Total Current Assets 291,639 711,370 1,003,009
Property and equipment, net 123,551 55,725 179,276
----------- ----------- -----------
Total Assets $ 415,190 $ 767,095 $ 1,182,285
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current Liabilities:
Current portion of long-term debt $ 79,572 $ 56,901 $ 136,473
Accounts payable 269,649 288,087 557,736
Accrued liabilities 102,523 38,193 140,716
Deferred revenue 138,930 18,895 157,825
----------- ----------- -----------
Total Current Liabilities 590,674 402,076 992,750
----------- ----------- -----------
Long-term debt, less current portion 17,413 363,099 380,512
----------- ----------- -----------
Stockholders' Equity (Deficit) (192,897) 1,920 (190,977)
----------- ----------- -----------
Total Liabilities and Stockholders' Equity (Deficit) $ 415,190 $ 767,095 $ 1,182,285
=========== =========== ===========
F-13
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
For the Year Ended June 30, 2000
Pro Forma Financial Information:
The following represents a pro forma condensed consolidated statement of
operations for the year ending June 30, 2000, assuming the Company's merger with
Time America, Inc. was consummated as of July 1, 1999.
PRO FORMA
TIME CONSOLIDATED
VITRIX, INC. AMERICA, INC. AMOUNTS
----------- ----------- -----------
Revenues $ 1,261,866 $ 2,651,713 $ 3,913,579
Cost of Revenues 485,971 1,314,094 1,800,065
----------- ----------- -----------
Gross Profit 775,895 1,337,619 2,113,514
----------- ----------- -----------
Costs and Expenses:
Sales and marketing 740,332 378,655 1,118,987
Research and development 570,856 649,318 1,220,174
General and administrative 583,059 512,293 1,095,352
----------- ----------- -----------
Total Costs and Expenses 1,894,247 1,540,266 3,434,513
----------- ----------- -----------
Net Income (Loss) from Operations (1,118,352) (202,647) (1,320,999)
Other Income (Expense): 20,133 (28,203) (8,070)
----------- ----------- -----------
Net Loss $(1,098,219) $ (230,850) $(1,329,069)
=========== =========== ===========
Basic and Diluted Loss per Share $ (0.40) $ (0.23)
=========== ===========
Weighted Average Number of Shares
Outstanding (1) 2,729,578 5,877,492
=========== ===========
- ----------
(1) To give effect to the issuance of 3,147,914 shares in connection with the
merger
F-14
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
For the Year Ended June 30, 1999
Pro Forma Financial Information:
The following represents a pro forma condensed consolidated statement of
operations for the year ending June 30, 1999, assuming the Company's merger with
Time America, Inc. was consummated as of July 1, 1998.
PRO FORMA
TIME CONSOLIDATED
VITRIX, INC. AMERICA, INC. AMOUNTS
----------- ------------- -----------
Revenues $ 743,954 $ 2,003,241 $ 2,747,195
Cost of Revenues 249,309 956,580 1,205,889
----------- ----------- -----------
Gross Profit 494,645 1,046,661 1,541,306
----------- ----------- -----------
Costs and Expenses:
Sales and marketing 288,559 301,066 589,625
Research and development 232,250 472,826 705,076
General and administrative 226,749 349,961 576,710
----------- ----------- -----------
Total Costs and Expenses 747,558 1,123,853 1,871,411
----------- ----------- -----------
Net Income (Loss) from Operations (252,913) (77,192) (330,105)
Other Income (Expense): 6,389 (68,836) (62,447)
----------- ----------- -----------
Net Loss $ (246,524) $ (146,028) $ (392,552)
=========== =========== ===========
Basic and Diluted Loss per Share $ (0.15) $ (0.08)
=========== ===========
Weighted Average Number of Shares
Outstanding (1) 1,647,387 4,795,301
=========== ===========
- ----------
(1) To give effect to the issuance of 3,147,914 shares in connection with the
merger
F-15
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
For the Nine Month Period Ended March 31, 2001
Pro Forma Financial Information:
The following represents a pro forma condensed consolidated statement of
operations for the nine month period ended March 31, 2001, assuming the
Company's merger with Time America, Inc. was consummated as of July 1, 2000.
PRO FORMA
TIME CONSOLIDATED
VITRIX, INC. AMERICA, INC. AMOUNTS
----------- ------------- -----------
Revenues $ 1,154,266 $ 2,068,886 $ 3,223,152
Cost of Revenues 534,999 1,050,923 1,585,922
----------- ----------- -----------
Gross Profit 619,267 1,017,963 1,637,230
----------- ----------- -----------
Costs and Expenses:
Sales and marketing 650,860 232,223 883,083
Research and development 499,541 474,348 973,889
General and administrative 491,222 386,524 877,746
----------- ----------- -----------
Total Costs and Expenses 1,641,623 1,093,095 2,734,718
----------- ----------- -----------
Net Income (Loss) from Operations (1,022,356) (75,132) (1,097,488)
Other Income (Expense): (6,194) (173,391) (179,585)
----------- ----------- -----------
Net Loss $(1,028,550) $ (248,523) $(1,277,073)
=========== =========== ===========
Basic and Diluted Loss per Share $ (0.33) $ (0.20)
=========== ===========
Weighted Average Number of Shares
Outstanding (1) 3,105,408 6,253,322
=========== ===========
- ----------
(1) To give effect to the issuance of 3,147,914 shares in connection with the
merger
F-16
VITRIX, INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
For the Nine Month Period Ended March 31, 2000
Pro Forma Financial Information:
The following represents a pro forma condensed consolidated statement of
operations for the nine month period ended March 31, 2000, assuming the
Company's merger with Time America, Inc. was consummated as of July 1, 1999.
PRO FORMA
TIME CONSOLIDATED
VITRIX, INC. AMERICA, INC. AMOUNTS
----------- ----------- -----------
Revenues $ 940,387 $ 2,047,191 $ 2,987,578
Cost of Revenues 349,285 968,766 1,318,051
----------- ----------- -----------
Gross Profit 591,102 1,078,425 1,669,527
----------- ----------- -----------
Costs and Expenses:
Sales and marketing 522,458 273,454 795,912
Research and development 359,765 474,066 833,831
General and administrative 457,360 374,793 832,153
----------- ----------- -----------
Total Costs and Expenses 1,339,583 1,122,313 2,461,896
----------- ----------- -----------
Net Income (Loss) from Operations (748,481) (43,888) (792,369)
Other Income (Expense): 8,132 (25,248) (17,116)
----------- ----------- -----------
Net Loss $ (740,349) $ (69,136) $ (809,485)
=========== =========== ===========
Basic and Diluted Loss per Share $ (0.28) $ (0.14)
=========== ===========
Weighted Average Number of Shares
Outstanding (1) 2,627,295 5,775,209
=========== ===========
- ----------
(1) To give effect to the issuance of 3,147,914 shares in connection with the
merger
F-17