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FORM 10-QSB
U.S. Securities and Exchange Commission
Washington D. C., 20549
(MARK ONE)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from__________ to ___________.
Commission file number 0-20924
RECONDITIONED SYSTEMS, INC.
(Exact name of small business issuer as specified in its charter)
ARIZONA 86-0576290
(State or other jurisdiction of incorporation or organization) (IRS Employer
Identification No.)
444 WEST FAIRMONT, TEMPE, ARIZONA 85282
(Address of principal executive offices)
602-968-1772
(Issuer's telephone number)
-------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant 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
equity, as of the latest practicable date: As of November 8, 1996, the number of
shares outstanding of the Registrant's common stock and Class B Warrants were
1,473,788 and 250,000, respectively.
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PART 1 - FINANCIAL STATEMENTS
ITEM 1
RECONDITIONED SYSTEMS, INC.
UNAUDITED FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
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RECONDITIONED SYSTEMS, INC.
- --------------------------------------------------------------------------------
BALANCE SHEET
SEPTEMBER 30, 1996
(UNAUDITED)
- --------------------------------------------------------------------------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents 257,829
Accounts receivable - trade, net of allowance
for doubtful accounts of $24,938 592,551
Inventory 1,027,066
Prepaid expenses and other current assets 200,965
---------
TOTAL CURRENT ASSETS 2,078,411
PROPERTY AND EQUIPMENT:
Machinery and equipment 216,311
Office furniture and equipment 241,399
Leasehold improvements 35,620
Vehicles 13,632
-------
506,962
Accumulated depreciation 301,731 205,231
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OTHER ASSETS:
Refundable deposits 14,649
Other 28,301 42,950
------- ---------
2,326,592
=========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Note payable (Note 4) 527,374
Current maturities of long-term debt 49,049
Accounts payable 308,900
Accrued expenses and other current liabilities 138,332
---------
TOTAL CURRENT LIABILITIES 1,023,655
LONG-TERM DEBT, LESS CURRENT MATURITIES 58,298
STOCKHOLDERS' EQUITY 1,244,639
---------
2,326,592
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RECONDITIONED SYSTEMS, INC.
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STATEMENT OF OPERATIONS
FOR THE THREE MONTH AND SIX MONTH PERIODS ENDED SEPTEMBER 30, 1995 AND 1996
(UNAUDITED)
- --------------------------------------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1995 1996 1995 1996
---- ---- ---- ----
Sales 2,123,621 1,408,927 4,975,036 3,296,414
Cost of sales 1,757,799 1,060,075 4,047,083 2,513,108
---------- ---------- ---------- ----------
Gross profit 365,822 348,852 927,953 783,306
Selling & administrative expenses 636,593 295,327 1,227,778 600,313
Restructuring charges 1,434,028 0 1,434,028 0
---------- ---------- ---------- ----------
Income (loss) from operations (1,704,799) 53,525 (1,733,853) 182,993
---------- ---------- ---------- ----------
Other income (expense):
Interest income 769 3,210 825 4,532
Interest expense (28,656) (29,681) (54,785) (59,659)
Other 19,197 (28) 22,928 0
---------- ---------- ---------- ----------
(8,690) (26,499) (31,032) (55,127)
---------- ---------- ---------- ----------
Net income (loss) (1,713,489) 27,026 (1,764,885 127,866
========== ========== ========== ==========
Earnings (loss) per common
and common equivalent share* (1.17) .02 (1.21) .08
========== ========== ========== ==========
Weighted average number
of shares outstanding 1,465,308 1,569,430 1,463,189 1,522,805
========== ========== ========== ==========
* -The 1995 losses per share have been restated to give retroactive effect to
the reorganization of the Company's capital structure (See Note 2).
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RECONDITIONED SYSTEMS, INC.
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STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE EIGHTEEN MONTH PERIOD ENDED SEPTEMBER 30, 1996
(UNAUDITED)
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COMMON COMMON PREFERRED PREFERRED RETAINED TREASURY
STOCK STOCK STOCK STOCK EARNINGS STOCK TOTAL
SHARES AMOUNT SHARES AMOUNT (DEFICIT) (134 SHARES) -----
------ ------ ------ ------ --------- ------------
BALANCE AT
MARCH 31, 1995 1,533,000 2,445,618 555,555 2,156,717 (1,737,266) (3,754) 2,861,315
PURCHASE OF
CORPORATE 76,300
UPHOLSTERY,
INC
CONVERSION OF
REDEEMABLE 12,000 43,525 43,525
COMMON STOCK
NET LOSS (1,728,052) (1,728,052)
BALANCE AT
MARCH 31, 1996 1,621,300 2,489,143 555,555 2,156,717 (3,465,318) (3,754) 1,176,788
CONVERSION OF
PREFERRED STOCK 7,222,228 2,096,702 (555,555) (2,156,717) (60,015)
TO COMMON
STOCK, NET OF
COSTS OF $60,015
(NOTE 2)
REVERSE SPLIT OF
COMMON STOCK (7,369,606) 0
(NOTE 2)
NET INCOME 127,866 127,866
---------- --------- --------- ----------- ---------- ------ ---------
BALANCE AT
SEPTEMBER 31, 1,473,922 4,585,845 0 0 (3,337,452) (3,754) 1,244,639
1996
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RECONDITIONED SYSTEMS, INC.
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STATEMENT OF CASH FLOWS
FOR THE THREE MONTH AND SIX MONTH PERIODS ENDED SEPTEMBER 30, 1995 AND 1996
(UNAUDITED)
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THREE MONTHS ENDED SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1995 1996 1995 1996
---- ---- ---- ----
Cash and cash equivalents
provided (used) by operating
activities 529,636 249,257 535,040 (3,550)
Cash and cash equivalents
used by investing
activities (6,077) (15,838) (6,077) (20,795)
Cash and cash equivalents
provided (used) by financing
activities (445,564) (169,530) (436,341) 181,476
-------- -------- -------- --------
Increase in cash
and cash equivalents 77,995 63,889 92,622 157,131
Cash and cash equivalents,
beginning of period 104,185 193,940 89,558 100,698
-------- -------- -------- --------
Cash and cash equivalents,
end of period 182,180 257,829 182,180 257,829
======== ======== ======== ========
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RECONDITIONED SYSTEMS, INC.
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
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NOTE 1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
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BASIS OF PRESENTATION:
The accompanying Statement of Operations for the three and six months
ended September 30, 1995, Statement of Stockholders' Equity for the
year ended March 31, 1996, and Statement of Cash Flows for the three
and six months ended September 30, 1995, are consolidated statements
and include all of the accounts of the Company and its wholly-owned
subsidiaries: RSI Integrated Parts, Inc., RSI Acquisitions, Inc.,
Corporate Upholstery, Inc., and Facility Options Group, Inc. All
intercompany accounts and transactions were eliminated in the
consolidation of these statements. All of the aforementioned
subsidiaries were closed as of March 31, 1996, and, as such, the
accompanying Balance Sheet as of September 30, 1996, Statement of
Operations for the six months ended September 30, 1996, Statement of
Stockholders' Equity for the three and six months ended September 30,
1996, and Statement of Cash Flows for the six months ended September
30, 1996, include only the accounts and transactions of the Company.
INTERIM FINANCIAL STATEMENTS:
The unaudited interim financial statements include all adjustments
(consisting of normal recurring accruals) which, in the opinion of
management, are necessary in order to make the financial statements not
misleading. Operating results for the six months ended September 30,
1996, are not necessarily indicative of the results that may be
expected for the entire year ending March 31, 1997. These financial
statements have been prepared in accordance with the instructions to
Form 10-QSB and do not contain certain information required by
generally accepted accounting principles. These statements should be
read in conjunction with financial statements and notes thereto
included in the Company's Form 10-KSB for the year ended March 31,
1996.
EARNINGS (LOSS) PER COMMON AND COMMON EQUIVALENT SHARE:
The computation of earnings (loss) per share is based on the net income
(loss) and the weighted average number shares of common stock and
common stock equivalents outstanding for each period. Certain stock
options outstanding are considered common stock equivalents during the
reporting quarter and period, and were accounted for under the Treasury
Stock method. These stock options were not included in the computation
of earnings (loss) per share during the comparable quarter or the
comparable period, as their effect would be antidilutive. In addition,
certain outstanding warrants are not included in the computation of
earnings (loss) per share because their effect would be antidilutive.
Fully diluted earnings per share were not materially different from
primary earnings per share. The earnings (loss) per share and the
weighted average number of shares outstanding for the periods presented
give retroactive effect to the conversion of preferred stock to common
stock and the reverse split of common stock which were effective on
August 12, 1996 (see Note 2).
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RECONDITIONED SYSTEMS, INC.
NOTES TO STATEMENTS (CONTINUED)
(UNAUDITED)
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NOTE 2.
REORGANIZATION OF CAPITAL STRUCTURE
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On August 5, 1996, at the Company's annual shareholders meeting, the Company's
shareholders approved, among other things, a reorganization of the Company's
capital structure. The reorganization, which was effective on August 12, 1996,
consisted of the automatic conversion of each share of the Company's Series A
Convertible Preferred Stock, together with any and all accrued but unpaid
dividends through the conversion date, into thirteen shares of common stock and
a one-for-six reverse stock split (immediately following the preferred stock
conversion).
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NOTE 3.
COMMON STOCK OPTIONS
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On August 19, 1996, the Board of Directors approved the repricing of 100,000
stock options held by the Company's President and Chief Executive Officer, and
100,000 stock options held by the Company's Chief Financial Officer from $2.75
per share to $1.00 per share. In addition, at the same time, the Board issued
100,000 stock options with an exercise price of $1.00 per share to the Company's
Chairman of the Board. All of these stock options are presently exercisable;
provided, however, that the holders may not sell or otherwise transfer any
shares acquired upon exercise of the options until August 19, 1997. The Company
has agreed to register the shares issuable upon exercise of the option by filing
a registration statement on Form S-8 with the Securities and Exchange
Commission. The option exercise price equals the fair market value of the
underlying common stock on August 19, 1996.
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NOTE 4.
SUBSEQUENT EVENT
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Norwest Business Credit, Inc. has amended the terms of the Company's revolving
line of credit agreement. As of November 1, 1996 the applicable rate of interest
under the line of credit was reduced to the bank's base rate plus four percent
(4%), and the minimum monthly interest requirement was reduced to $4,000. In
addition, per the terms of the amendment, if the net income of the Company meets
or exceeds $200,000 for the fiscal year ended March 31, 1997, the interest rate
will be further reduced to the bank's base rate plus three percent (3%), with a
minimum monthly interest requirement of $2,500. The amendment also extended the
expiration of the revolving line of credit to February 28, 2000.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATIONS
The statements contained herein which are not historical facts may constitute
"forward-looking statements" within the meaning of Section 27A of the Securities
Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended, and are subject to the safe harbors created thereby. These
forward-looking statements involve risks and uncertainties, including, but not
limited to, the Company's ability to maintain and increase current sales levels,
maintain a collection rate at or near its standard terms, and maintain annual
inventory turns of at least 4. In addition, the Company's business, operations
and financial condition are subject to substantial risks which are described in
the Company's reports and statements filed from time to time with the Securities
and Exchange Commission. These reports and statements include the Company's
Annual Report on Form 10-KSB for the fiscal year ended March 31, 1996.
RESULTS OF OPERATIONS
THREE MONTH PERIOD ENDED SEPTEMBER 30, 1996
Reconditioned Systems, Inc. ("RSI" or the "Company") reported net income of
$27,026 for the three month period ended September 30, 1996 (hereinafter the
"reporting quarter") compared to a net loss of $1,713,489 for the three month
period ended September 30, 1995 (hereinafter the "comparable quarter"). The
improvement to the Company's net income was primarily attributable to the effect
of RSI's restructuring program which was completed and resulted in a $1,434,028
charge during the comparable quarter. The restructuring program downsized the
Company to its original form by closing all of its subsidiaries. RSI, not
including the losses of subsidiaries closed as part of its restructuring
program, had a net loss of $72,978 for the comparable quarter primarily as a
result of management's focus on the restructuring program.
The Company's revenues for the reporting quarter were $1,408,927 which
represents a $714,694 or 34% decrease from the comparable quarter. This decrease
was attributable to the downsizing that was done in conjunction with the
Company's restructuring program. RSI, excluding sales by the subsidiaries closed
as part of the restructuring, had sales of $1,152,454 for the comparable
quarter. The 22% increase in sales at RSI from the comparable to the reporting
quarters was due to unusually low sales at RSI during the comparable quarter
which resulted from management's focus on the restructuring program. During the
comparable quarter, management's time and energies were primarily focused on
closing the subsidiary operations and the entire Company was adversely affected
by the uncertainties the restructuring created.
Sales at RSI since it closed its subsidiaries were $1,493,557 for the quarter
ended December 31, 1995, $1,503,104 for the quarter ended March 31, 1996,
$1,887,487 for the quarter ended June 30, 1996, and $1,408,927 for the reporting
quarter. Management believes these fluctuations in sales are due to the
variations in the sales performance of its individual salespeople from
month-to-month, and a key to maintaining and sequentially improving sales is to
employ sufficient salespeople in expanded territories so that individual
performance becomes less critical for the Company to reach its sales goals.
Based on these beliefs, management has taken steps to further develop its sales
staff and expand into other regional markets.
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MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)
As of the beginning of the reporting period, April 1, 1996, the Company had four
salespeople focusing on the local retail market and two salespeople focusing on
non-local wholesale sales. Currently, the Company has six salespeople focusing
on the local retail market in Phoenix, one salesperson focusing on the local
retail market in Tucson, one salesperson focusing on non-local wholesale sales,
and it has created a sales manager position to train new salespeople as well as
monitor the activities of existing salespeople. The Company also plans to
increase its sales personnel within the non-local wholesale sales department.
Because training time varies from individual to individual and the success rate
of new salespeople is not 100%, there can be no assurance that the actions taken
by management to maintain or improve on the reporting quarter's sales levels
will be effective for the quarter ended December 31, 1996 or any subsequent
period. The Company intends to continue to selectively add to its sales staff
both locally and in other nearby markets.
The Company's gross profit margin during the reporting quarter was 25%, compared
with 17% for the comparable quarter. RSI's gross margin, not including the
subsidiaries closed as part of the restructuring plan for the comparable quarter
was 12%. The low margin for the comparable quarter was adversely affected by
RSI's unusually low sales in the comparable quarter where the Company's plant
was not near full capacity. Since the fixed costs associated with the plant were
then spread over less sales, the gross profit margin on these sales was less
than it is during a period in which the plant operates closer to full capacity.
The increase in the margin during the reporting quarter reflects the results of
the Company operating at a volume closer to the maximum production capacity.
The Company's selling and administrative expenses for the reporting quarter were
21% of sales as compared with 30% during the comparable quarter. This
improvement in the reporting quarter was achieved as a result of the downsizing
of the Company through implementation of its restructuring program. RSI's
selling and administrative expenses, not including the subsidiaries closed as
part of the restructuring program, were 19% during the comparable quarter. The
2% increase was a result of recent additions to the sales staff as part of
management's plan to increase and stabilize sales volume.
The Company's other income and expenses, which consist primarily of interest
expense, was $26,499 and $8,690 during the reporting and comparable quarters,
respectively, an increase of $17,809. This increase was primarily due to
miscellaneous income items earned by the subsidiary operations during the
comparable quarter.
SIX MONTH PERIOD ENDED SEPTEMBER 30, 1996
The Company reported net income of $127,866 for the six month period ended
September 30, 1996 (hereinafter the "reporting period") compared to a net loss
of $1,764,885 for the six month period ended September 30, 1995 (hereinafter the
"comparable period"). RSI, not including the losses of subsidiaries closed as
part of its restructuring program, had net income of $26,391 for the comparable
period. The improvement in the Company's net income was primarily attributable
to RSI's restructuring as discussed above
The Company's revenues for the reporting period were $3,296,414 which represents
a $1,678,622 or 34% decrease over the comparable period. This decrease was
attributable to the downsizing that was done in conjunction with the Company's
restructuring program. Sales at RSI, excluding sales by the subsidiaries closed
as part of the restructuring, were $3,033,062 for the comparable period. The 9%
improvement in revenues during the reporting period was primarily a result of
the lower sales during the comparable quarter, which resulted from management's
focus on the restructuring program.
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MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)
The company's gross profit margin during the reporting period was 24%, compared
with 19% for the comparable period. RSI's gross margin, not including the
subsidiaries closed as part of the restructuring plan for the comparable period
was 19%. The lower gross profit margins during the comparable period were
primarily a result of operating at levels significantly less than full capacity
during the comparable quarter.
The Company's selling and administrative expenses for the reporting period were
18% of sales as compared with 25% during the comparable period. This improvement
was also attributable to the downsizing and restructuring of the Company. RSI's
selling and administrative expenses, not including the subsidiaries closed as
part of the restructuring program, were 14% for the comparable period. The 4%
increase was a result of added personnel within the sales department.
The Company's other income and expenses, which consists primarily of interest
expenses, was $55,127 and $31,032 during the reporting and comparable periods,
respectively. This increase is primarily due to the fact that the Company's new
lender, Norwest Business Credit, Inc., is charging the Company a higher
borrowing rate than the Company's former lender. In addition, there were certain
miscellaneous income items earned by the subsidiary operations during the
comparable period.
FINANCIAL CONDITION
As a result of the net income for the reporting period and the reorganization of
the Company's capital structure that was approved at the annual shareholders
meeting on August 5, 1996, the Company's financial condition and liquidity has
improved dramatically during the reporting period. The automatic conversion of
each outstanding share of Series A Convertible Preferred Stock and accrued
dividends into 13 shares of common stock relieved the Company of accrued but
unpaid dividends of approximately $337,500 and the burden of the $56,250 per
quarter dividend going forward.
As of September 30, 1996, the Company's financial condition and liquidity is
sufficient to sustain current operating levels and pursue gradual and focused
growth. The Company has net worth of $1,244,639 and working capital of
$1,054,756. In addition, as of the date of this report, the Company has a
balance of approximately $400,000 and additional availability of approximately
$300,000 on its line of credit with Norwest Business Credit, Inc.. Since the
total availability under this line of credit agreement is based upon accounts
receivable and inventory up to a maximum amount of $1.2 million, this
arrangement should provide the Company with the short-term working capital
required for gradual growth. As of September 30, 1996, the Company was in
compliance with all of the financial convenants required by this financing
agreement.
With the elimination of the preferred stock dividend, the three items which now
primarily control the Company's financial condition and liquidity are its
results of operations, its collection of accounts receivable, and its ability to
turn inventory. The results of operations during the reporting quarter and
period were discussed above. The second item, the number of days sales in
accounts receivable as of September 30, 1996, was 33 as compared to 25 as of
March 31, 1996, and 44 as of June 30, 1996. Because the Company's standard terms
are net 30 days from existing customers and 50% down and 50% net 30 days from
new customers, the Company views the 25 days at March 31, 1996 as an anomaly and
does not expect to maintain a collection rate under 30 days in the future. For
the reporting quarter and period, the Company turned its inventory at an
annualized rate of approximately 3.8 and 4.2 times, respectively as compared to
4.7 times for the year ended March 31, 1996. The lower turns during the
reporting quarter and period are consistent with the lower sales revenues.
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MANAGEMENT'S DISCUSSION AND ANALYSIS (CONTINUED)
The Company's operating activities produced positive cash flow during the
reporting quarter and a minimal amount of negative cash flow during the
reporting period. The increase in the cash provided by operating activities
during the reporting quarter was primarily attributable to net income and an
improved collection rate as compared to the previous quarter. The net income
earned during the reporting period was offset by weaker inventory turns and
collection rate than those achieved during the year ended March 31, 1996 and ,
as a result, the Company did not have positive cash flows from operating
activities during the reporting period.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not party to any pending legal proceeding other than routine
litigation incidental to the business.
ITEM 2. CHANGES IN SECURITIES
Effective August 12, 1996, the Company converted its 9% Series A Convertible
Preferred Stock and accrued but unpaid dividends into Common Stock on the basis
of 13 shares of Common Stock for each share of "Preferred Stock". In addition,
the Company implemented a six-to-one reverse stock split of the Company's Common
Stock, including the shares of Common Stock into which the Preferred Stock was
converted (see below under Item 3 and 4).
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
During February, 1994, the Company issued 555,555 shares of Preferred Stock. The
dividend requirement on this Preferred Stock was $56,282 per quarter and the
last dividend paid was during February, 1995, resulting in an arrearage in the
amount of $337,692 as of August 1, 1996. Effective August 12, 1996, the
Preferred Stock and the accrued dividends were converted to Common Stock (see
below under Item 4).
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
On August 5, 1996, the Company held its annual shareholders meeting. The
following six proposals were presented at the meeting:
1. To consider and act upon a proposal (the "Preferred Stock Proposal") to amend
the Company's Articles of Incorporation to provide for the automatic conversion,
on August 12, 1996, of each outstanding share of the Company's Preferred Stock,
together with any and all accrued but unpaid dividends through the conversion
date, into 13 shares of the Company's Common Stock.
2. If the Preferred Stock Proposal is approved by the Stockholders, to consider
and act upon a proposal to amend the Company's Articles of Incorporation to
effect a six-to-one reverse stock split of the Company's presently issued shares
of Common Stock (including the shares of Common Stock into which the Preferred
Stock will be converted pursuant to the Preferred Stock Proposal).
3. Whether or not the Preferred Stock Proposal is approved by the Stockholders,
to consider and act upon a proposal to amend the Company's Articles of
Incorporation to make certain technical corrections and to eliminate, in certain
circumstances, the liability of directors to the Company and the Stockholders.
4. Whether or not the Preferred Stock Proposal is approved by the Stockholders,
to consider and act upon a proposal to amend and restate the Company's Bylaws.
5. To elect to the Board of Directors Wayne Collignon, Dirk Anderson, and Scott
Ryan.
6. To consider and act upon a proposal to ratify the appointment of Semple &
Cooper, PLC as the Company's independent public accountants for the fiscal year
ending March 31, 1997.
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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS (CONTINUED)
All six proposals were passed at the meeting and the following table provides
the results of the voting:
Proposal Shares Eligible Voted For Voted Against Abstentions Broker Non-Votes
- -------- --------------- --------- ------------- ----------- ----------------
Preferred Common Preferred Common Preferred Common Preferred Common Preferred Common
--------- ------ --------- ------ --------- ------ --------- ------ --------- ------
1 555,555 1,620,500 364,443 1,160,136 5,555 1,600 0 0 0 0
2 555,555 1,620,500 364,443 1,160,136 0 1,600 5,555 0 0 0
3 555,555 1,620,500 364,443 1,160,136 5,555 1,600 0 0 0 0
4 555,555 1,620,500 364,443 1,159,936 0 1,500 5,555 300 0 0
5(1) 555,555 1,620,500 369,998 1,160,336 0 0 0 1,400 0 0
6 555,555 1,620,500 364,443 1,161,736 0 0 5,555 0 0 0
(1) The votes listed in this row were identical for Wayne Collignon, Dirk
Anderson, and Scott Ryan. Each such person was elected as a Director at the
meeting.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed herewith pursuant to Regulation S-B:
NO. DESCRIPTION REFERENCE
- --- ----------- ---------
3.1 Amended and Restated Articles of Incorporation (3)
3.2 Amended and Restated Bylaws (3)
4.1 Form of Stock Certificate (1)
4.2 Form of Class A and Class B Warrant (1)
4.3 Form of Series A Preferred Stock Agreement (2)
10.1 Lease Agreement, dated April 12, 1990 between Boston
Safe Deposit and Trust Company, as Lessor, and Registrant
as Lessee (1)
10.11 Purchase Agreement between Registrant and Corporate
Upholstery, Inc. (4)
10.16 Purchase Agreement between Registrant and Facility Options
Group, Inc. (5)
10.17 Loan document between National Bank of Arizona and Registrant (6)
10.18 Agreement for Surrender and Cancellation of Redemption Right
between Larry Henry and Registrant (7)
10.21* Employment Agreement between Registrant and Wayne Collignon (8)
10.22* Employment Agreement between Registrant and Dirk Anderson (8)
10.23 Third amendment to the Lease between Registrant, as Lessee,
and Newhew Associates, as Lessor (8)
10.24 Loan documents between Registrant and Norwest Business Credit (8)
10.25* Amendment to Employment Agreement between Registrant and
Wayne Collignon (9)
10.26* Amendment to Employment Agreement between Registrant and
Dirk Anderson (9)
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)
10.27 Amendments to Loan document between Norwest Business
Credit and Registrant (9)
27 Financial Data Schedule
(1) Filed with Registration Statement on Form S-18, No. 33-51980-L:A, under
Securities Act of 1933, as declared effective on December 17, 1992.
(2) Filed with Form 10-KSB on June 29, 1994.
(3) Filed with the Company's definitive proxy statement on July 10, 1996
(4)Filed with Form 8 amendment on May 17, 1993, amending 8-K filed on April 30,
1993
(5) Filed with Form 8-K on August 17, 1993
(6) Filed with Form 10-KSB on July 13, 1995
(7) Filed with Form 10-KSB on June 20, 1994
(8) Filed with Form 10-KSB on July 10, 1996
(9) Filed with Form 10-QSB on November 14, 1996
(b) Reports on Form 8-K:
No reports were filed on Form 8-K during the quarter ended September 30, 1996.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
RECONDITIONED SYSTEMS, INC.
/s/ Wayne R. Collignon
Date: November 14, 1996 _________________________________
--------------------------- Wayne R. Collignon, President and CEO
/s/ Dirk D. Anderson
Date: November 14, 1996 _________________________________
--------------------------- Dirk D. Anderson, CFO
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