================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 8-K/A
Amendment No. 1 to
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report December ___, 2003; Amending 8-K filed August 7, 2002.
(Date of earliest event reported August 1, 2002):
Commission file number 333-42936
DND Technologies, Inc.
(Exact name of Registrant as specified in its charter)
Nevada 84-1405298
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
375 E. Elliot Rd., Bldg. 6
Chandler, Arizona 85225
(Address of principal executive offices)
(480) 892-7020
(Registrant's telephone number including area code)
N/A
(Former name or former address, if changed since last report)
================================================================================
This Current Report on Form 8-K/A amends Item 7 of the Current Report on Form
8-K filed with the Securities and Exchange Commission on August 1, 2002.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Aspect Semiquip International, Inc. Financial Statements
Report of Woods & Dwyer, P.L.C., Independent Auditors
Balance Sheets as of December 31, 2001 and 2000
Statements of Operations and Retained Earnings (Deficit) for the
Years Ended December 31, 2001 and 2000
Statements of Cash Flows for the Years Ended December 31, 2001 and
2000
Notes to Financial Statements
(b) Pro Forma Financial Information
Unaudited Pro Forma Condensed Consolidated Balance Sheet as of
March 31, 2002
Unaudited Pro Forma Condensed Consolidated Statements of Operations
for the Three Months Ended March 31, 2002
Unaudited Pro Forma Condensed Consolidated Statements of Operations
for the Year Ended December 31, 2001
Notes to Unaudited Pro Forma Condensed Consolidated Financial
Statements
(c) Exhibits
23.1 Consent of Woods & Dwyer, P.L.C., Independent Auditors.
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.
Date: January 21, 2004 DND Technologies, Inc., a Nevada
corporation
/s/ Douglas N. Dixon
-------------------------------------
Douglas N. Dixon
President and Chief Executive Officer
2
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Aspect Semiquip International, Inc.
Chandler, Arizona
We have audited the accompanying balance sheets of Aspect Semiquip
International, Inc. as of December 31, 2001 and 2000, and the related statements
of earnings and retained deficit, and cash flows for the years then ended. 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 U.S. generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Aspect Semiquip International,
Inc. as of December 31, 2001 and 2000, and the results of its operations and its
cash flows for the years then ended in conformity with generally accepted
accounting principles.
As discussed in Note 14 to the financial statements, the Company announced the
acquisition of the Company by a publicly traded shell.
/s/ Woods & Dwyer, P.L.C.
Phoenix, Arizona
March 5, 2002,
(except for Note 14, as to which the date is May 21, 2002)
3
ASPECT SEMIQUIP INTERNATIONAL, INC.
BALANCE SHEETS
DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
2001 2000
----------- -----------
ASSETS
CURRENT ASSETS:
Cash $ 419,690 $ 567,418
Accounts receivable 456,494 2,587,904
Inventory 1,889,250 2,587,167
Prepaid and other expenses 61,183 49,186
----------- -----------
Total current assets 2,826,617 5,791,675
----------- -----------
PROPERTY AND EQUIPMENT:
Office furniture, fixtures and equipment 330,812 439,588
Leasehold improvements 404,661 399,050
Machinery and equipment 332,860 211,637
Laboratory tools 25,833 30,698
Vehicles 32,600
----------- -----------
Total property and equipment 1,094,166 1,113,573
Less accumulated depreciation (348,603) (258,258)
----------- -----------
Property and equipment, net 745,563 855,315
----------- -----------
TOTAL ASSETS $ 3,572,180 $ 6,646,990
=========== ===========
(Continued)
4
ASPECT SEMIQUIP INTERNATIONAL, INC.
BALANCE SHEETS - Continued
DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
2001 2000
----------- ----------
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $ 146,404 $ 88,257
Bank line of credit 746,216
Accounts payable 311,079 1,531,531
Accrued payroll and related expenses 554,665 772,754
Accrued expenses 349,068 330,065
Customer deposits and credits 291,272 507,923
Related party notes payable 409,350 409,350
Deferred revenue 20,294 194,367
----------- ----------
Total current liabilities 2,828,348 3,834,247
----------- ----------
LONG-TERM DEBT, Net of current portion 356,654 276,762
----------- ----------
SHAREHOLDERS' EQUITY:
Common stock, no par value, 10,000,000 shares
authorized, 2,500,000 shares issued and
outstanding 1,816,370 1,816,370
Preferred stock, 5,000,000 shares authorized,
no shares issued and outstanding
Retained earnings (deficit) (1,429,192) 719,611
----------- ----------
Total shareholders' equity 387,178 2,535,981
----------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 3,572,180 $6,646,990
=========== ==========
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
5
ASPECT SEMIQUIP INTERNATIONAL, INC.
STATEMENTS OF EARNINGS AND RETAINED DEFICIT
FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
2001 2000
----------- ------------
REVENUES $ 8,102,843 $ 17,371,090
COST OF SALES 4,129,573 8,314,087
----------- ------------
GROSS MARGIN 3,973,270 9,057,003
GENERAL AND ADMINISTRATIVE EXPENSES 5,320,564 6,265,268
----------- ------------
INCOME (LOSS) FROM OPERATIONS (1,347,294) 2,791,735
----------- ------------
OTHER INCOME (EXPENSE):
Other income (16,540) 53,544
Other expenses (84,704) (65,301)
----------- ------------
Other expense, net (101,244) (11,757)
----------- ------------
NET EARNINGS (LOSS) $(1,448,538) $ 2,779,978
=========== ============
RETAINED EARNINGS (DEFICIT),
BEGINNING OF YEAR $ 719,611 $ (1,426,248)
NET EARNINGS (LOSS) (1,448,538) 2,779,978
DISTRIBUTIONS (700,265) (634,119)
----------- ------------
RETAINED EARNINGS (DEFICIT),
END OF YEAR $(1,429,192) $ 719,611
=========== ============
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
6
ASPECT SEMIQUIP INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
2001 2000
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings (loss) $(1,448,538) $ 2,779,978
Adjustments to reconcile net earnings (loss)
to net cash provided by (used by)
operating activities:
Depreciation 208,406 55,936
Provision for inventory obsolescence 65,000 90,000
Loss on disposal of property and equipment 71,911 5,988
Accrued interest 34,540 7,988
----------- -----------
Net cash provided by (used by)
operating activities (1,068,681) 2,939,890
----------- -----------
ACCRUALS OF EXPECTED FUTURE OPERATING
CASH RECEIPTS AND PAYMENTS:
Decrease (increase) in:
Accounts receivable 2,131,410 (1,768,064)
Inventory 632,917 (1,729,865)
Prepaid and other expenses (11,997) (35,438)
Increase (decrease) in:
Accounts payable (1,220,452) 1,093,921
Accrued payroll and related expenses (218,089) 588,230
Accrued expenses (110,077) 137,198
Customer deposits and credits (156,651) 466,823
Deferred revenue (174,073) 194,367
----------- -----------
872,988 (1,052,828)
----------- -----------
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES (195,693) 1,887,062
----------- -----------
(Continued)
7
ASPECT SEMIQUIP INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS - Continued
FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
2001 2000
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (182,197) (758,100)
Proceeds from the sale of property 3,240 0
--------- ---------
Net cash provided by (used in)
investing activities (178,957) (758,100)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under line of credit 746,216 (17,173)
Proceeds from issuance of long-term debt 250,000
Principal payments on long-term debt (69,029) (85,954)
Distributions paid (700,265) (638,922)
--------- ---------
Net cash provided by (used by)
financing activities 226,922 (742,049)
--------- ---------
NET INCREASE (DECREASE) IN CASH (147,728) 386,913
CASH AT BEGINNING OF YEAR 567,418 180,505
--------- ---------
CASH AT END OF YEAR $ 419,690 $ 567,418
========= =========
See Notes to Financial Statements.
- --------------------------------------------------------------------------------
8
ASPECT SEMIQUIP INTERNATIONAL, INC.
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2001 AND 2000
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES AND OTHER GENERAL MATTERS
Nature of Operations
Aspect Semiquip International, Inc., (A.S.I.) founded on November 2, 1990
under the laws of the State of Arizona, is a supplier of semiconductor
manufacturing capital equipment. A.S.I. supplies complete after market
support of the Lam Research Corp. AutoEtch(TM)and Rainbow(TM) plasma dry
etch systems including parts and assemblies.
During 2000 the Company created a subsidiary company, ASI Team Asia Ltd.
(ASI Team), in Hong Kong for sales and marketing of the Company products
and services to customers in Asia. The Company owns 85% of ASI Team.
Effective June 1, 2001, the Company entered into a business combination
with a Texas based Company. (See Note 13)
Cash and Cash Equivalents
For purposes of the statements of cash flows, the Company considers all
highly liquid debt instruments purchased with maturities of 90 days or
less to be cash equivalents.
Accounts Receivable
Due to the nature of its customers, management believes that all accounts
receivable are fully collectible. Therefore, no allowance for doubtful
accounts has been provided for the years ended December 31, 2001 and 2000.
9
Inventory
Inventories are stated at the lower of cost or market, with cost being
determined in a manner which approximates the first-in, first-out method.
Cost elements are the raw product plus freight, labor, and manufacturing
overhead. Inventories consist of the following at December 31:
2001 2000
----------- -----------
Raw materials $ 1,589,407 $ 2,310,153
Work-in-process 454,843 337,014
Reserve (155,000) (90,000)
----------- -----------
Total $ 1,889,250 $ 2,587,167
=========== ===========
Property and Equipment
Property and equipment are stated at cost. The lease rights acquired
through capital leases are recorded on the balance sheet with property and
equipment and total $96,547. The related obligations on capital leases are
accounted for as liabilities (See Note 7). Depreciation is provided for by
accelerated and straight-line methods over the following estimated useful
lives:
Office furniture, fixtures and equipment 5 - 7 years
Leasehold improvements 3 - 15 years
Machinery and equipment 7 years
Laboratory tools 7 years
Vehicles 5 years
Depreciation expense for the years ended December 31, 2001 and 2000 was
$208,406 and $55,936, respectively.
Income Taxes
The Company, with the consent of its shareholders, had elected under the
Internal Revenue Code to be an S Corporation. In lieu of corporate income
taxes, the shareholders of an S Corporation were taxed on their
proportionate share of the Company's taxable income. Effective September
1, 2001, the Company revoked this election.
10
Preferred Stock
The Company is authorized to issue 5,000,000 of preferred stock. These
shares shall be non-voting, have no right to receive dividends, but shall
share equally on a share by share basis with the owners of common stock in
the proceeds, if any, resulting from the liquidation of the corporation,
the sale of substantially all of its assets, or the acquisition by a third
party of 100% of the voting stock of the corporation. During the year
ended December 31, 2001 the Company issued no preferred shares.
Warranty Reserve
The financial statements include a product warranty reserve of $60,000 and
$52,000 for the years ended December 31, 2001 and 2000, respectively. It
is based on estimates of future costs associated with fulfilling the
warranty obligation. The estimates are derived from historical cost
experience.
2. USE OF ESTIMATES IN FINANCIAL STATEMENTS
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions which affect the reported amounts of assets and liabilities
and disclosure of continent 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.
3. DISCLOSURES ABOUT FAIR VALUE OF FINANCIAL INSTRUMENTS
The Company has financial instruments, none of which are held for trading
purposes. The Company estimates that the fair value of financial
instruments at December 31, 2001 and 2000, as defined in FASB 107, does
not differ materially from the aggregate carrying values of its financial
instruments recorded in the accompanying balance sheets. The estimated
fair value amounts have been determined by the Company using available
market information and appropriate valuation methodologies. Considerable
judgement is required in interpreting market data to develop the estimates
of fair value, and, accordingly, the estimates are not necessarily
indicative of the amounts that the Company could realize in a current
market exchange.
11
4. CONCENTRATION OF CREDIT RISK
Financial instruments that potentially subject the Company to
concentrations of credit risk are cash, accounts receivable and sales.
Cash
Financial instruments that potentially subject the Company to
concentrations of credit risk with respect to cash arise due to the fact
that as of December 31, 2001 and 2000, the Company had on deposit with
financial institutions approximately $347,000 and $584,000, respectively,
in excess of the F.D.I.C. insurance coverage for those funds.
Accounts Receivable
Concentrations of credit risk with respect to accounts receivable exist
because, as of December 31, 2001 and 2000, 0% and 27%, respectively, of
the balance reported originated with two customers.
Sales
For the years ended December 31, 2001 and 2000, 0% and 28% of the
Company's sales were with 0 and two customers, respectively.
5. LINE OF CREDIT
The Company has available a $1,000,000 revolving line of credit with a
financial institution, maturing on May 31, 2002 and bearing interest at
Libor plus 2.75%. The note is secured by corporate assets and has been
personally guaranteed by a 70% shareholder. As of December 31, 2001 there
was an outstanding balance of $746,216 on the line.
The note contains numerous loan covenants that the Company is not in
compliance with. As of the date of the audit report the Company has not
obtained wavers for these deficiencies.
12
6. LONG-TERM DEBT AND SECURED ASSETS
As of December 31, 2001 and 2000, the following note and obligations under
capital lease were due and payable:
2001 2000
--------- ---------
Note payable, former shareholder, dated
May 15, 1997 payable in quarterly
installments of $24,319 including interest
at 10%. Final payment is due on May 15,
2004. (Secured by common stock, held in
escrow, see Note 12) $ 212,500 $ 283,700
Note payable with a financial institution,
dated May 18, 2001. The note is payable
in sixty monthly installments of $4,167
with interest at Libor plus 2.75% 227,541 0
Obligations under capital leases (See
Note 7) 63,017 81,319
--------- ---------
503,058 365,019
Current maturities (146,404) (88,257)
--------- ---------
$ 356,654 $ 276,762
========= =========
Future maturities of long-term debt and secured assets are as follows:
2002 $146,404
2003 151,191
2004 112,910
2005 63,385
2006 29,168
--------
$503,058
========
13
7. DESCRIPTION OF LEASE AGREEMENTS
Capital Leases
Equipment:
The Company has entered into lease agreements for office equipment which
have been classified as capital leases. The present value of future
minimum lease payments under these leases and the corresponding
liabilities have been recorded in the financial statements as property and
equipment and long-term debt respectively (See notes 1 and 6). The imputed
interest rates on these leases range from approximately 11.0% to 13%.
Operating Leases
Real Estate:
The Company leases office space in Chandler, Arizona and Richardson,
Texas. The Arizona lease is a five-year triple net lease arrangement
beginning in December of 1999, at a base rate of approximately $13,300 per
month, adjustable annually with common area fees of approximately $6,600
per month. The Texas lease is a renewable three-year lease arrangement
beginning in July of 2000, at a base rate of approximately $6,790
adjustable annually.
Equipment:
The Company leases a fork lift under a five year operating lease
arrangement with monthly payments of $374.
Summary:
Future minimum lease payments on operating leases are as follows:
2002 $260,700
2003 222,600
2004 181,600
2005 1,900
--------
$666,800
========
For the years ended December 31, 2001 and 2000, total lease expense
charged to operations was $259,003 and $161,620, respectively.
14
8. INCOME TAXES
Income tax (benefit) expense for the years ended December 31, 2001 and
2000 consisted of the following:
2001
Federal State Total
-------- -------- ---------
Deferred $(93,147) $(52,395) $(145,542)
======== ======== =========
2000
Federal State Total
-------- -------- ---------
Deferred $ 0 $ 0 $ 0
======== ======== =========
As of December 31, 2001 the Company had deferred tax assets of
approximately $145,540, net of an allowance of the same. As of December
31, 2001 the Company had federal and state net operating loss
carry-forwards of approximately $582,000 available to offset future
taxable income, if any. The allowance account was established to account
for those loss carry-forwards that may expire unused. The federal net
operating loss carry-forwards will begin to expire in the year 2020 and
the state net operating loss carry-forwards will begin to expire in the
year 2006. For the year ended December 31, 2001 there was no current
income tax expense.
The income tax provision (benefit) differs from the expense that would
result from applying federal statutory rates to income before income taxes
because deferred income taxes are based on average tax rates.
9. RELATED PARTY TRANSACTIONS
During the fiscal years ended December 31, 1999, 1998 and 1997 the Company
entered into various note payable agreements with two shareholders and
officers. The notes bear interest ranging from 3% to 7% and are due upon
demand or within twelve months of the date of the note. It is the intent
of the shareholders to renew all note agreements that have expired.
Advances under these notes are as follows:
Year ended December 31, 1997 $ 60,000 $120,000
Year ended December 31, 1998 60,000 119,350
Year ended December 31, 1999 0 50,000
-------- --------
$120,000 $289,350
======== ========
For the years ended December 31, 2001 and 2000 accrued interest on these
notes totaled $94,105 and $63,467, respectively.
15
10. EMPLOYEE BENEFIT PLAN
Effective January 1, 1997 the Company adopted the Aspect Systems
Retirement Savings Plan, a defined contribution pension plan covering
substantially all employees that have met certain eligibility and
participation requirements as defined in the plan document. The plan was
amended in 2000 to allow discretionary employer contributions. During the
year ended December 31, 2001 and 2000, Company contributions totaled
$5,451 and $30,328 respectively.
11. STOCK OPTIONS
The Company has adopted a stock option plan that provides for the granting
of options to certain officers and key employees of the Company. The
option price, numbers of shares and grant date are determined at the sole
discretion of the Company's board of directors. Grantees vest in the
options subject to a vesting schedule as is disclosed in the "Stock Option
Agreement". A grantee's right to exercise a vested portion of their
Options shall occur no later than five years following the grant date. The
fair market value of each option is $.50 as determined by the Board. For
the years ended December 31, 2001 and 2000, no options have been
exercised, however 3 employees have vested in 40% of their option shares
totaling 60,000 shares.
12. STOCK REDEMPTION AGREEMENT
In May, 1997, the employment of the former president, who was a 35%
shareholder, was terminated. Pursuant to the stock redemption agreement,
dated November 2, 1990, the Company exercised its option to redeem the
shares held by the former president. The Agreement calls for a total
purchase price equal to the book value of the common shares held as of May
31, 1997, payable in quarterly installments over a seven year term at a
10% interest rate (See Note 6). The associated stock relating to this
agreement has been endorsed in blank and is being held in escrow until the
purchase price is paid in full.
13. BUSINESS COMBINATION
Effective June 1, 2001, Aspect Systems, Inc., an Arizona Corporation
combined with Semiquip, Inc., a Texas Corporation to form Aspect Semiquip
International, Inc., an Arizona Corporation. Semiquip, Inc. was a service
organization providing 1) repair services for Chiller and Rainbow systems
and 2) contract service technicians to the high tech industry.
The method of combination used by the Companies was the pooling of
interests method. Aspect Systems, Inc. issued 750,000 shares of its no par
common stock in the combination.
16
The details of the results of operations of the previously separate
companies for the five months ended May 31, 2001 and for the twelve months
ended December 31, 2000 that are included in the Statement of Earnings and
Retained Deficit are as follows:
Five months ended May 31, 2001
Aspect
Systems, Inc. Semiquip, Inc.
------------- --------------
Revenues $ 3,787,497 $1,362,878
============ ==========
Net earnings (loss) $ (18,971) $ 405,941
============ ==========
Distributions $ 0 $ 149,060
============ ==========
Twelve months ended December 31, 2000
Aspect
Systems, Inc. Semiquip, Inc.
------------- --------------
Revenues $ 13,568,032 $4,084,662
============ ==========
Net earnings (loss) $ 1,917,952 $ 904,505
============ ==========
Distributions $ 446,968 $ 187,151
============ ==========
14. SUBSEQUENT EVENTS
On May 17, 2002, the Company issued a press release that Zurichkirch
Corporation, a publicly traded shell, had acquired Aspect Semiquip
International, Inc. in a tax-free exchange of stock.
The Company is in negotiations with a 30% shareholder to redeem their
shares of stock in Aspect Semiquip International, Inc. in exchange for an
interest free $500,000 note payable, plus certain assets.
15. CONTINGENCIES
As discussed in Note 5, the Company has not obtained wavers to the
existing loan covenants. The ultimate effect on Company operations in the
near term that could result from a deemed default cannot be reasonably
estimated.
The Company was required to file, with the Inland Revenue Department in
Hong Kong, China, a Profits Tax Return (Form B.I.R. 51) by December 9,
2001. As of the date of this audit report Form B.I.R. 51 has not been
completed. Failure to
17
submit the tax return may result in significant penalties imposed by the
Inland Revenue Department. The amount of these penalties cannot be
reasonably estimated.
16. OTHER CASH FLOW DISCLOSURES
Supplemental Disclosures
2001 2000
------- -------
Cash
Cash paid during the period
for interest $53,700 $57,000
======= =======
Non-Cash
Assets acquired through
capital leases $ 8,392 $88,160
======= =======
18
DND TECHNOLOGIES, INC.
(FORMERLY ZURICHKIRCH CORPORATION)
AND
ASPECT SEMIQUIP INTERNATIONAL, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 2002
UNAUDITED
(in thousands)
DND Adjustments Consolidated
----- ----------- ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ -0- $ 250 $ 250
Accounts receivable, net 667 667
Inventories 1,853 1,853
Prepaid expenses and
other current assets 62 62
----- ------- -------
Total current assets 2,832 2,832
----- ------- -------
PROPERTY AND EQUIPMENT, Net 713 713
----- ------- -------
TOTAL ASSETS $ -0- $ 3,545 $ 3,545
===== ======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES $ -0- $ 3,504 $ 3,504
----- ------- -------
STOCKHOLDERS' EQUITY:
Common stock 10 12 22
Paid-in capital 366 1,804 2,170
Retained earnings (deficit) (376) (1,775) (2,151)
----- ------- -------
Total stockholders' equity -0- 41 41
----- ------- -------
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY $ -0- $ 3,545 $ 3,545
===== ======= =======
19
DND TECHNOLOGIES, INC.
(FORMERLY ZURICHKIRCH CORPORATION)
AND
ASPECT SEMIQUIP INTERNATIONAL, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2002
UNAUDITED
(in thousands except per share data)
Income Statements Pro Forma
------------------- ---------------------------------
DND ASI Adjust Ref Consol'd
------- ------- ------- --- --------
REVENUES $ -0- $ 1,188 $ 1,188
COST OF SALES 842 842
------- ------- --------
GROSS PROFIT -0- 346 346
------- ------- --------
OPERATING EXPENSES:
Selling, general
and administrative 9 642 $ (9) a 642
Research and development 28 28
------- ------- --------
Total operating expenses 9 670 670
------- ------- --------
OTHER INCOME (EXPENSE), Net (22) (22)
------- ------- --------
LOSS FROM OPERATIONS
BEFORE INCOME TAXES (9) (346) $ 9 (346)
INCOME TAX EXPENSE
------- ------- --------
NET LOSS $ (9) $ (346) $ 9 $ (346)
======= ======= ========
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic and diluted 10,000 12,000 22,000
======= ========
BASIC AND DILUTED LOSS
PER SHARE N/A $ (0.02) $ (0.02)
======= ========
20
DND TECHNOLOGIES, INC.
(FORMERLY ZURICHKIRCH CORPORATION)
AND
ASPECT SEMIQUIP INTERNATIONAL, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2001
UNAUDITED
(in thousands except per share data)
Income Statements Pro Forma
-------------------- -----------------------------
DND ASI Adjust Ref Consol'd
------- ------- -------- --- --------
REVENUES $ -0- $ 8,103 $ 8,103
COST OF SALES 4,130 4,130
------- ------- --------
GROSS PROFIT -0- 3,973 3,973
------- ------- --------
OPERATING EXPENSES:
Selling, general
and administrative 88 5,321 $ (88) a 5,321
Research and development 57 $ (57) a
------- ------- -------- --------
Total operating expenses 145 5,321 $ (145) 5,321
------- ------- -------- --------
OTHER INCOME (EXPENSE), Net (1) (101) $ 1 a (101)
------- ------- -------- --------
LOSS FROM OPERATIONS
BEFORE INCOME TAXES (146) (1,449) $ 146 (1,449)
INCOME TAX EXPENSE
------- ------- --------
NET LOSS $ (146) $(1,449) $ 146 $ (1,449)
======= ======= ========
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic and diluted 5,635 16,365 22,000
======= ========
BASIC AND DILUTED LOSS
PER SHARE $ (0.03) $ (0.04) $ (0.07)
======= ========
21
DND TECHNOLOGIES, INC.
(FORMERLY ZURICHKIRCH CORPORATION)
AND
ASPECT SEMIQUIP INTERNATIONAL, INC.
CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED
(in thousands)
The unaudited pro forma condensed consolidated statement of operations for
the twelve months ended December 31, 2001 gives effect to the consolidated
results of operations as if the merger occurred at January 1, 2001. The
unaudited pro forma condensed consolidated statement of operations for the three
months ended March 31, 2002 gives effect to the consolidated results of
operations as if the merger occurred at January 1, 2002. These results are not
necessarily indicative of the consolidated results of operations of the Company
as they may be in the future, or as they might have been had these events been
effective at January 1, 2001 and 2002, respectively. The unaudited pro forma
condensed consolidated balance sheet gives effect to the financial position at
March 31, 2002 as if the merger occurred at March 31, 2002. Such consolidated
financial position is not necessarily indicative of the Company as it may be in
the future, or as it might have been had these events been effective at March
31, 2002. The unaudited pro forma condensed consolidated financial information
should be read in conjunction with the historical financial statements of the
Company and Aspect Semiquip International, Inc. ("ASI") and the related notes
thereto.
PRO FORMA ADJUSTMENTS FOR THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE
SHEET AT MARCH 31, 2002
a. Reflects the accounting of the transaction as a recapitalization of ASI
rather than a business combination.
PRO FORMA ADJUSTMENTS FOR THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS FOR THE TWELVE MONTHS ENDED DECEMBER 31, 2001 AND THE
THREE MONTHS ENDED MARCH 31, 2002
a. Gives effect to the reduction of administrative and research and
development expenses of the operation of the Company upon acquisition.
22
INDEX TO EXHIBITS
Exhibit
Number Description of Document
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23.1 Consent of Woods & Dwyer, P.L.C., Independent Auditors
23