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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Item 2-July 25, 2001; Item 4-May 30, 2001; Item 5-July 27, 2001
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(Date of Report: Date of earliest event reported)
LEXON TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-24721 87-0502701
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(State or other jurisdiction (Commission File Number) (IRS Employer ID No.)
of incorporation)
1401 Brook Drive, Downers Grove, Illinois 60515
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(Address of principal executive office)
Registrant's telephone number, including area code: (630)916-6196
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ITEM 2. DISPOSITION OF ASSETS
On July 25, 2001, Lexon Technologies, Inc. (the "Company") received a
notice and demand letter from The Miller Group ("Miller") that Miller was
exercising certain of its rights as a secured creditor due to the Company's
default on payments due under a Security Agreement between Miller and Chicago
Map Corporation, the Company's wholly owned subsidiary, dated November 18,
1999 (the "Security Agreement"). The demand letter requires the Company to
assemble all of collateral subject to the Security Agreement and make it
available to Miller. The demand letter further announces Miller's intention
to dispose of the collateral in a public sale to be held August 14, 2001.
The collateral subject to the Security Agreement is essentially all of
the assets of Chicago Map Corporation. The Company has unsuccessfully sought
equity and/or debt financing to fund current operations and stave off
creditors. After exploring available alternatives to the seizure of the
affected collateral, the Company has determined that allowing Miller to
proceed is the only option which might permit customers of Chicago Map
Corporation to continue to receive service while the sale is proceeding.
The complete text of the demand letter is attached as an exhibit to this
filing. The demand letter includes a detail of the collateral subject to
seizure and sale.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT
On May 30, 2001, the Company's auditors, Hutton Nelson & McDonald, LLP,
("HN & M") sent the Company a termination notice confirming the cessation of
the client-auditor relationship due to non payment of fees for professional
services rendered during 1999 and 2000. The Company has not attempted to
engage alternative auditors because the Company currently does not have any
funds available to hire such alternative auditors. (See Item 2 above and Item
5 below).
During the Company's two most recent fiscal years ended December 31, 1998
and 1999, respectively (the "Prior Fiscal Years"), HN & M did not issue any
adverse opinions or disclaimers of opinion or qualify or modify an opinion as
to uncertainty, audit scope, or accounting principles. During and the interim
period from January 1, 2000 through September 30, 2000 (the "Interim Period"),
HN & M modified its review reports for the six months ended June 30, 2000 and
the nine months ended September 30, 2000, respectively, to include an
explanatory paragraph as to uncertainty about the Company's ability to
continue as a going concern. During the Prior Fiscal Years and the Interim
Period, the Company has had no disagreement with HN & M as to any matter of
accounting principles or practices, financial statements disclosure or
auditing scope or procedure which, if not resolved to the satisfaction of HN &
M, would have caused it to make reference to the subject matter of such
disagreement in connection with its reports for the Prior Fiscal Years.
There were no "reportable events" as such term is referred to in Item
304(a)(1)(v) of Regulation S-K during either (i) the Prior Fiscal Years or
(ii) the Interim Period.
The Company has requested that HN & M review the foregoing disclosures
and provide a letter addressed to the Securities and Exchange Commission
stating whether they agree with the above statements and, if not, stating in
what respects they do not agree. HN & M's letter is included as an exhibit to
this report on Form 8-K. The complete text of the termination letter is also
attached as an exhibit to this filing.
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ITEM 5. OTHER INFORMATION
The Company's financial situation is desperate. The assets subject to
seizure by The Miller Group, as detailed in Item 2 above, represent
essentially all of the assets of the Company. Chicago Map Corporation has been
the operating entity for the Company and the seizure of assets means that the
Company will have no operations.
The directors have explored various alternatives in order to maintain
operations, including capital infusions through debt and/or equity financing,
joint venture business arrangements, and renegotiation of outstanding
liabilities with The Miller Group and other creditors. None of these efforts
have been successful. Management reduced expenses and eliminated employees in
a further effort to control costs and maintain operations.
Because of the Company's financial straits, the Company has not been able
to pay the professional fees owed to accountants and attorneys for the filing
of its periodic reports with the Securities and Exchange Commission. The last
report filed was for the quarter ended September 30, 2000. This failure to
file resulted in loss of the listing for the Company's common stock on the
NASD's over-the-counter quotation system in May 2001.
At this date, the Company's liabilities greatly exceed its assets. The
directors have determined that there are no viable alternatives to a
bankruptcy filing under Chapter 7 of the U.S. Bankruptcy Code, and intend to
make such a filing in the immediate future.
ITEM 7. EXHIBITS
The following exhibits are included as part of this report:
SEC
Exhibit Reference
Number Number Title of Document Location
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99 99 Demand Letter dated July 25, 2001 This filing
16 16.01 Resignation Letter from Hutton Nelson This filing
& McDonald dated May 30, 2001
16 16.02 Letter from Hutton Nelson & McDonald This filing
Relating to its resignation
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, thereunto duly authorized.
LEXON TECHNOLOGIES, INC.
Date: July 31, 2001
/S/Kenneth J. Eaken, President and Chief Executive Officer