1
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
July 21, 1999
(Date of Report: Date of earliest event reported)
LEXON TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-02474 87-0502701
- ---------------------------- ----------------------- --------------------
(State or other jurisdiction (Commission File Number) (IRS Employer ID No.)
of incorporation)
1401 Brook Drive, Downers Grove, Illinois 60515
------------------------------------------------
(Address of principal executive office)
Registrant's telephone number, including area code: (630) 916-6196
--------------
REXFORD, INC., 7777 East Main Street, Suite 201, Scottsdale, AZ 85251
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(Former name or former address, if changed since last report)
2
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
On July 20, 1999, the Registrant's shareholders approved the acquisition
of all of the issued and outstanding shares of Chicago Map Corporation, a
privately-held Illinois corporation. In connection with such acquisition
transaction, the Registrant's shareholders and Board of Directors adopted
resolutions to effect a 70-for-1 reverse split of the Registrant's issued and
outstanding shares of $.001 par value common stock and Common Stock Purchase
Warrants. The Acquisition was closed on July 21, 1999. A total of 10,500,000
post-split shares of the Registrant's common stock were issued in connection
with the acquisition transaction. At the time of the acquisition, the
individuals serving as officers and directors of the Registrant resigned, upon
the election and appointment of their successors. As of the date hereof, a
total of 11,500,000 shares of the Registrant's common stock are issued and
outstanding. Effective July 21, 1999, the effective date of the 70-for-1
reverse split, a total of 11,500,000 shares of the Registrant's common stock
are issued and outstanding. The Registrant's name was changed to LEXON
Technologies, Inc. in connection with the acquisition. The following
individuals were elected as directors and officers of the Registrant and may
be deemed in control of Registrant as of the date hereof:
Name Position Shares(1) %
Steven J. Peskaitia Chairman, Chief Executive 6,774,600 58.9
Officer & President
John B. McLean Vice-President, Chief 0 0.0
Financial Officer, Director
Kenneth J. Eaken Vice-President, Director 100,100 .8
Mike Barnett Vice-President, Secretary 442,400 3.8
Director
Paris Karahalios Vice-President, Director 730,800 6.4
James L. Rooney Director 0 0.0
Thomas W. Rieck Director 0 0.0
(1) Shares owned give effect to the 70-for-1 reverse split
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On July 21, 1999, the Registrant acquired all of the issued and
outstanding stock of Chicago Map Corporation, a privately-held Illinois
corporation. The acquisition was structured as a stock-for-stock exchange
pursuant to Section 368(a)(1)(B) of the Internal Revenue Code. The securities
issued in the acquisition were issued in a private transaction in reliance on
Section 4(2) of the Securities Act of 1933, as amended. In connection with
such acquisition, the Registrant's shareholders elected new directors and
voted in favor of a proposal to change the Registrant's name to LEXON
Technologies, Inc. Additionally, the Registrant's shareholders voted in favor
of a proposal to effect a 70-for-1 reverse split of the outstanding
securities. The Registrant intends to engage in the business of developing,
manufacturing and marketing a full range of geographic and statistical
information applications through Internet, electronic, multimedia, CD-Rom, DVD
and other interactive technology formats for business, educators, students and
consumers.
3
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS, AND EXHIBITS
(a) Financial Statements of businesses acquired
CHICAGO MAP CORPORATION
BALANCE SHEET
MARCH 31, 1999
ASSETS
Current assets
Cash $ 64,093
Accounts receivable 68,318
Inventories 5,108
Deferred tax assets 39,571
------------
Total current assets 177,090
------------
Property and equipment
Leasehold improvements 5,190
Furniture and equipment 123,472
------------
128,662
Accumulated depreciation 81,129
------------
47,533
------------
Other assets
Computer software costs 48,446
Intangible assets 49,802
Deposit 5,000
------------
103,248
------------
$ 327,871
============
The accompanying note is an integral part of these financial statements.
4
CHICAGO MAP CORPORATION
BALANCE SHEET
(Continued)
MARCH 31, 1999
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 38,796
Accrued liabilities
Payroll taxes 17,797
Distributions to stockholders 209,774
------------
Total current liabilities 266,367
------------
Long-term debt
Note payable 100,000
------------
Stockholders' equity (deficit)
Common stock 1,500
Retained earnings (deficit) (39,996)
------------
(38,496)
------------
$ 327,871
============
The accompanying note is an integral part of these financial statements.
5
CHICAGO MAP CORPORATION
STATEMENT OF INCOME (LOSS)
THREE MONTHS ENDED MARCH 31, 1999
Sales $ 186,780
Cost of sales 95,492
------------
Gross profit 91,288
Administrative expense 208,631
------------
Loss before income tax benefit (117,343)
Income tax benefit 39,571
------------
Net loss $ (77,772)
============
The accompanying note is an integral part of these financial statements.
6
CHICAGO MAP CORPORATION
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
THREE MONTHS ENDED MARCH 31, 1999
Common Stock Retained
--------------------------- Earnings
Shares Amount (Deficit)
------------ ------------ ------------
Balance, January 1, 1999 10,000 $ 1,000 $ 250,225
Net loss (77,772)
Issuance of common stock 5,000 500
Distributions to stockholders
Cash (2,675)
Accrued (209,774)
------------ ------------ ------------
Balance, March 31, 1999 15,000 $ 1,500 $ (39,996)
============ ============ ============
The accompanying note is an integral part of these financial statements
7
CHICAGO MAP CORPORATION
STATEMENT OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1999
Cash flows from operating activities:
Cash received from customers $ 216,637
Cash paid to suppliers and employees (249,775)
------------
Net cash used in operating activities (33,138)
------------
Cash flows from investing activities:
Capital expenditures (16,900)
Acquisition of intangible assets (50,220)
Payment of deposit (5,000)
------------
Net cash used in investing activities (72,120)
------------
Cash flows from financing activities:
Proceeds from issuance of long-term debt 100,000
Issuance of common stock 500
Cash distributions paid to stockholders (2,675)
------------
Net cash provided by financing activities 97,825
------------
Net decrease in cash (7,433)
Cash at beginning of period 71,526
------------
Cash at end of period $ 64,093
============
The accompanying note is an integral part of these financial statements.
8
CHICAGO MAP CORPORATION
STATEMENT OF CASH FLOWS
(Continued)
THREE MONTHS ENDED MARCH 31, 1999
Reconciliation of net loss to net cash used in
operating activities:
Net loss $ (77,772)
------------
Adjustments to reconcile net loss to net cash used in
operating activities
Depreciation 1,504
Amortization 6,817
Change in assets (increase) decrease:
Accounts receivable 29,857
Inventories 2,905
Deferred tax assets (39,571)
Change in liabilities increase:
Accounts payable 33,056
Accrued liabilities 10,066
------------
Total adjustments 44,634
------------
Net cash used in operating activities $ (33,138)
============
The accompanying note is an integral part of these financial statements.
9
CHICAGO MAP CORPORATION
NOTE TO FINANCIAL STATEMENTS
MARCH 31, 1999
ACQUISITION
On March 12, 1999, the Company acquired certain assets of TRIUS, Inc. for
$62,300 in cash and 2,198 shares of common stock of Chicago Map Corporation
(the "Company"). The 2,198 shares of common stock are included in the 15,000
shares of common stock of the Company outstanding at March 31, 1999. The value
attributed to the issuance of the common stock was $220 based on management's
estimate of $0.10 per share as the fair value of the Company's no par common
stock. The principal business of TRIUS, Inc. is the development of computer
software technologies.
STOCK BONUS
In connection with this acquisition, the Board of Directors approved a stock
bonus of 2,802 shares to an officer and an employee of the company. The 2,802
shares of common stock are included in the 15,000 shares of common stock of
the Company outstanding at March 31, 1999. The value attributed to the
issuance of the common stock was $280 based on management's estimate of $0.10
per share as the fair value of the Company's no par common stock.
The fair value of the Company's no par common stock was estimated by
management as there is no established market for the Company's common stock.
Management believes the fair value of the Company's no par common stock
approximates its stated value of $0.10 per share considering the Company's
negative working capital and retained earnings deficit.
10
Hutton Nelson & McDonald LLP
Certified Public Accountants
1815 South Meyers Road Suite 550
Oakbrook Terrace, Illinois 60181-5230
630/495-5400 FAX 630/495-0561
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Chicago Map Corporation
We have audited the accompanying balance sheets of Chicago Map
Corporation as of December 31, 1998 and 1997, and the related statements of
income (loss), changes in shareholders' equity, and cash flows for each of the
three years ended December 31, 1998. These financial statements are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statement based on our audits.
We conducted our audits 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 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 Chicago Map
Corporation as of December 31, 1998 and 1997, and the results of its
operations and its cash flows for each of the three years ended December 31,
1998, in conformity with generally accepted accounting principles.
/S/Hutton, Nelson & McDonald LLP
Oakbrook Terrace, Illinois
March 17, 1999
11
CHICAGO MAP CORPORATION
BALANCE SHEETS
ASSETS
December 31,
1998 1997
------- -------
Current assets
Cash $ 71,526 $ 76,091
Accounts receivable, less allowance for
doubtful accounts of $25,000 and $100,000 98,175 89,501
Inventories 8,013 19,287
Prepaid expenses - 3,800
------ ------
Total current assets 177,714 188,679
======= =======
Property and equipment
Leasehold improvements 3,971 16,072
Furniture and equipment 107,791 102,604
------- -------
Accumulated depreciation 32,137 51,705
------ ------
Other asset
Computer software costs, net of accumulated
amortization of $16,343 in 1998 54,845 22,030
------ ------
$264,696 $262,414
======= =======
The accompanying notes are an integral part of these financial statements.
12
CHICAGO MAP CORPORATION
BALANCE SHEETS
(continued)
LIABILITIES AND SHAREHOLDERS' EQUITY
December 31,
1998 1997
------- -------
Current liabilities
Accounts payable $ 5,740 $ 2,123
Accrued liabilities
Payroll taxes 7,731 11,500
Income taxes - 927
----- ------
Total current liabilities 13,471 14,550
------ ------
Shareholders' equity
Common stock, no par value; authorized
100,000 shares; issued and outstanding
10,000 shares 1,000 1,000
Retained earnings 250,225 246,864
------- -------
251,225 247,864
------- -------
$264,696 $262,414
======= =======
The accompanying notes are an integral part of these financial statements.
13
CHICAGO MAP CORPORATION
STATEMENTS OF INCOME (LOSS)
Year Ended December 31
1998 1997 1996
--------- --------- ---------
Sales $1,175,295 $1,934,433 $1,597,616
Cost of sales 333,357 890,586 759,662
--------- --------- ---------
Gross profit 841,938 1,043,847 837,954
Administrative expense 765,202 1,081,036 708,002
------- --------- -------
Income (loss) from operations 76,736 (37,189) 129,952
Other expense
Interest Expense - - (138)
Loss on disposition of assets (13,100) - -
------ ------ -------
Income (loss) before income taxes 63,636 (37,189) 129,814
Income taxes - 927 1,728
------ ------ -------
Net income (loss) $ 63,636 $ (38,116) $ 128,086
====== ====== =======
Average common shares outstanding 10,000 10,000 10,000
====== ====== ======
Earnings (loss) per common share $ 6.36 $(3.81) $12.81
====== ====== ======
The accompanying notes are an integral part of these financial statements.
14
CHICAGO MAP CORPORATION
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
Common Stock Retained
Shares Amount Earnings
------ ------ --------
Balance, January 1, 1996 10,000 $1,000 $287,949
Net income 128,086
Cash distributions (68,635)
------ ----- -------
Balance, December 31, 1996 10,000 $1,000 347,400
Net income (38,116)
Cash distributions (62,420)
------ ----- -------
Balance, December 31, 1997 10,000 $1,000 246,864
Net income 63,636
Cash distributions (60,275)
------ ----- -------
Balance, December 31, 1998 10,000 $1,000 $250,225
====== ===== =======
The accompanying notes are an integral part of these financial statements.
15
CHICAGO MAP CORPORATION
STATEMENTS OF CASH FLOWS
Year Ended December 31
1998 1997 1996
--------- --------- ---------
Cash flows from operating activities:
Cash received from customers $1,141,761 $1,775,213 $1,748,237
Cash paid to suppliers and employees (1,028,544) (1,859,751) (1,389,739)
Interest paid - - (138)
Income taxes paid (927) (1,728) (2,613)
--------- --------- ---------
Net cash provided by (used in)
operating activities 112,290 (86,266) 355,747
------- ------ -------
Cash flows from investing activities:
Proceeds from sale of equipment 425 - -
Capital expenditures (7,847) (17,880) (47,958)
Payment of computer software costs (49,158) (22,030) -
------ ------ ------
Net cash used in investing
activities (56,580) (39,910) (47,958)
------ ------ ------
Cash flows from financing activities:
Payments on loan from shareholder - - (6,827)
Cash distributions paid to shareholders (60,275) (62,420) (68,635)
------ ------ ------
Net cash used in financing
activities (60,275) (62,420) (75,462)
------ ------ ------
Net increase (decrease) in cash (4,565) (188,596) 232,327
Cash at beginning of year 76,091 264,687 32,360
------ ------- -------
Cash at end of year $ 71,526 $ 76,091 $264,687
====== ====== =======
The accompanying notes are an integral part of these financial statements.
16
CHICAGO MAP CORPORATION
STATEMENTS OF CASH FLOWS
(continued)
Year Ended December 31
1998 1997 1996
--------- --------- ---------
Reconciliation of net income (loss)
to net cash provided by (used in)
operating activities:
Net income (loss) $ 63,636 $(38,116) $ 128,086
------ ------ -------
Adjustment to reconcile net income (loss)
to net cash provided by (used in)
operating activities:
Depreciation 13,890 13,222 5,893
Amortization of computer software costs 16,343 - -
Amortization of organization costs - 17 25
Loss on disposition of assets 13,100 - -
Change in assets (increase) decrease:
Accounts receivable (8,674) (36,550) 281,423
Inventories 11,274 12,812 (7,638)
Prepaid expenses 3,800 - (3,800)
Changes in liabilities increase
(decrease):
Accounts payable 3,617 (38,732) (52,006)
Accrued liabilities (4,696) 1,081 3,764
------ ------ ------
Total adjustments 48,654 (48,150) 227,661
------ ------ -------
Net cash provided by (used in)
operating activities $112,290 $(86,266) $355,747
======= ====== =======
The accompanying notes are an integral part of these financial statements.
17
CHICAGO MAP CORPORATION
NOTES TO FINANCIAL STATEMENTS
NATURE OF OPERATIONS
The Company creates technologies and software tools which provide for the
design and development of mapping and geographic products sold to customers
located throughout the world.
SUMMARY OF ACCOUNTING POLICIES
Revenue Recognition - The Company records sales and related profits as
product is shipped and services are rendered. Revenue from licensing of
software is based on sales of copies of software products in accordance with
distribution agreements with licensed developers and recognized as licensing
fees accrue. Costs for post-contract customer support, upgrades and
enhancements are billed separately from other charges and are not included in
revenue from licensing of software. Accordingly, no licensing arrangements
required deferral of revenue during 1998, 1997, and 1996.
Estimates - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the amounts reported in the financial statements
and accompanying notes. Actual results could differ from those estimates.
Inventories - Inventories are priced at the lower of cost, determined by
the first-in, first-out method, or market.
Property and Equipment - Property and equipment are recorded at cost.
Expenditures for renewals and betterments which extend the life of such assets
are capitalized. Maintenance and repairs are charged to expense as incurred.
Differences between amounts received and net carrying value of assets retired
or disposed of are charged or credited to income.
Depreciation - Depreciation is charged to income using straight-line and
accelerated methods based on the estimated useful lives of the assets.
Computer Software Costs - Costs related to the purchase and development
of computer software are capitalized from the time technological feasibility
is established until the software is available for sale. Capitalized costs
are amortized on a straight-line basis over twenty-four months, the estimated
economic life of the software. Amortization expense charged to income was
$16,343 in 1998. No amortization was charged to income in 1997 and 1996.
Unamortized computer software costs determined to be in excess of the net
realizable value of the software are expensed immediately.
Income Taxes - The Company has elected S corporation status for income
tax purposes. Under this election, the Company is not liable for federal
income taxes, but is liable for certain state income and replacement taxes.
Federal taxable income and tax credits flow through to the shareholders to be
reported on their individual income tax returns.
Earnings Per Common Share - Earnings (loss) per common share are computed
by dividing net income (loss) by the weighted average number of common shares
outstanding during the year.
CASH
During 1998 and 1997, the Company maintained an operating account with a
bank which at times exceeded the federally insured limit of $100,000. The
bank has a strong credit rating and management considers any risk to be
minimal.
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CHICAGO MAP CORPORATION
NOTES TO FINANCIAL STATEMENTS
(continued)
DEPRECIATION
Depreciation was charged to income, based on the estimated useful lives
of the assets, in the following amounts:
1998 1997 1996 Estimated Life-Years
---- ---- ---- --------------------
Leasehold improvements $ 260 $ 428 $ 194 31-39
Furniture and equipment 13,630 12,794 5,699 5-7
------ ------ -----
$13,890 $13,222 $ 5,893
====== ====== =====
TRANSACTION WITH RELATED PARTY
The Company leases office facilities on a month-to-month basis from a
shareholder at a monthly rental of $3,000. Rent expense charged to income
amounted to $36,000 in 1998, 1997 and 1996.
SUBSEQUENT EVENTS
On January 4, 1999, the Board of Directors declared a $240,000 cash
distribution to the shareholders provided such amount does not exceed the
Company's Accumulated Adjustment Account which is part of retained earnings as
shown on the Balance Sheets.
On March 12, 1999, the Company acquired certain assets of TRIUS, Inc. for
$62,300 in cash and 2,198 shares of common stock of Chicago Map Corporation.
The principal business of TRIUS, Inc. is the development of computer software
technologies. In connection therewith, the Board of Directors approved a
stock bonus of 2,802 shares to be issued to an officer and an employee of the
Company.
19
(b) Pro Forma Financial Statements.
LEXON TECHNOLOGIES, INC., F.K.A. REXFORD, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS)
SIX MONTHS ENDED MARCH 31, 1999
(Unaudited)
PRO FORMA ADJUSTMENTS
---------------------
HISTORICAL ACQUISITION(a) PRO FORMA
------------ ------------ ------------
Sales $ - $ 509,790 $ 509,790
Cost of sales - 194,257 194,257
------------ ------------ ------------
Gross profit - 315,533 315,533
Administrative expense 27,533 404,385 431,918
------------ ------------ ------------
Loss before income tax benefit (27,533) (88,852) (116,385)
Income tax benefit - 39,571 39,571
------------ ------------ ------------
Net loss $ (27,533) $ (49,281) $ (76,814)
============ ============ ============
Average common shares outstanding 11,500,000
============
Loss per common share $ (0.01)
============
<FN>
(a) To reflect the acquisition of all of the issued and outstanding shares of common stock of
Chicago Map Corporation as if the transaction had been completed at the beginning of the period.
</FN>
20
LEXON TECHNOLOGIES, INC. F.K.A. REXFORD, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS)
YEAR ENDED SEPTEMBER 30, 1998
(Unaudited)
PRO FORMA ADJUSTMENTS
---------------------
HISTORICAL ACQUISITION(a) OTHER PRO FORMA
------------ ------------ ------------ ------------
Sales $ - $ 1,175,295 $ - $ 1,175,295
Cost of sales - 333,357 - 333,357
------------ ------------ ------------ ------------
Gross profit - 841,938 - 841,938
Administrative expense 46,350 765,202 2,833(b)(c) 814,385
------------ ------------ ------------ ------------
Income (loss) from operations (46,350) 76,736 (2,833) 27,553
Other expense - (13,100) - (13,100)
------------ ------------ ------------ ------------
Income (loss) before income taxes (46,350) 63,636 (2,833) 14,453
Income taxes - 4,914 - 4,914
------------ ------------ ------------ ------------
Net income (loss) $ (46,350) $ 58,722 $ (2,833) $ 9,539
============ ============ ============ ============
Average common shares outstanding 11,500,000
============
Earnings per common share $ 0.00
============
<FN>
(a) To reflect the acquisition of all of the issued and outstanding shares of common stock of
Chicago Map Corporation as if the transaction had been completed at the beginning of the period.
(b) To reflect the depreciation and amortization of $2,553 in connection with the acquisition of
certain assets of Tirus, Inc. by Chicago Map Corporation as if the transaction had been completed
at the beginning of the period.
(c) To reflect stock bonus of $280 to an officer and an employee of Chicago Map Corporation as if
the transaction had been completed at the beginning of the period.
</FN>
21
(c) Exhibits. The following exhibits are included as part of this report:
SEC
Exhibit Reference
Number Number Title of Document Location
- ------- --------- ----------------- --------
1 2.01 Agreement and Plan of Reorganization This Filing
dated March 23, 1999
2 3.01 Amended Certificate of Incorporation This Filing
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunder duly authorized.
LEXON TECHNOLOGIES, INC.
Date: July 31, 1997 /S/John B. McLean, Chief Financial
Officer