SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20459
FORM 10-KSB/A-2 Annual or Transitional Report
AMENDMENT NO. 2
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [FEE REQUIRED]
For the fiscal year ended September 30, 2002
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 (NO FEE REQUIRED)
Commission File Number 0-17580
SYNERGX SYSTEMS INC.
(Exact name of Small Business Issuer in its charter)
Delaware 11-2941299
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
209 Lafayette Drive, Syosset, New York 11791
(Address of principal executive offices) (zip code)
Issuer's telephone number, including area code: (516) 433-4700
Securities registered pursuant to Section 12(b) of the Act: None Securities
registered pursuant to Section 12(g) of the Act:
Common Stock, $.001 par value per share
(Title of Class)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days. YES X NO
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the Registrant's knowledge, in definitive proxy or information
statements be reference in Part III of this Form 10-KSB ( )
State issuer's revenues for its most recent fiscal year: $16,943,000
The aggregate market value of the voting stock held by non-affiliates of the
Registrant, based upon the average bid and ask prices for the Registrant's
Common Stock, $.001 par value per share, as of December 16, 2002 was $1,079,784.
As of December 14, 2002, the Registrant had 1,874,425 shares of Common
Stock outstanding.
Documents Incorporated by Reference: None
ITEM 10. EXECUTIVE COMPENSATION
The following table sets forth certain information with respect to
compensation paid or accrued by the Company for services rendered to it for each
of the three fiscal years ended September 30, 2002, as to Daniel S. Tamkin, the
Company's present Chief Executive Officer, Joseph Vitale, the Company's
President and Chief Operating Officer, and John A. Poserina, the Company's Chief
Financial Officer and Secretary; none of the Company's other Executive Officers
had aggregate remuneration in excess of $100,000.
SUMMARY COMPENSATION TABLE
LONG
ANNUAL COMPENSATION TERM COMPENSATION
All Other
Year Salary ($) Bonus($) Other($) Option/SAR Compensation
- -----------------------------------------------------------------------------
Daniel S. Tamkin
2002 $97,000 $5,600 --
2001 87,000 $20,000 5,600 (1) --
2000 74,000 20,000 5,600 --
Joseph Vitale
2002 $140,000 $6,000 --
2001 130,000 $30,000 6,000 (2) --
2000 113,000 30,000 6,000 --
John A. Poserina
2002 $151,000 $5,600 --
2001 141,000 $30,000 5,600 --
2000 124,000 30,000 5,600 --
- ------
(1) Options to purchase 4,167 shares of Common Stock, at a price of $1.03 per
share were issued to Mr. Tamkin in December, 2000.
(2) Options to purchase 7,959 shares of Common Stock, at a price of $1.03 per
share were issued to Mr. Vitale in December, 2000.
- -----------
The following table details, as of September 30, 2002, the value of
unexercised in-the-money options held by Daniel S. Tamkin, Joseph Vitale and
John A. Poserina:
Number of Securities Value of Unexercised
Underlying Unexercised Options In-The-Money Options (1)
Exercisable Unexercisable Exercisable Unexercisable
---------- ------------ ----------- -------------
Daniels S. Tamkin 8,833 2,000 $ 792 $ 250
Joseph Vitale 14,367 2,758 3,001 417
John A. Poserina 7,667 2,000 1,542 250
- - - ------
(1) Net value, calculated as the difference between the exercise price and the
market price reported for September 30, 2002.
In December 1995, the Board of Directors voted to institute a 401(k) plan
for nonunion employees to be effective January 1, 1996. The plan includes a
profit sharing provision at the discretion of the Board of Directors. No profit
sharing contributions were authorized in 2002. In 2001 the Board of Directors
approved a payment totaling $44,000 for participants of the non-union and union
401(k) plans.
Directors do not receive any compensation for their service. Out-of-pocket
expenses for travel, meals and miscellaneous expenses incurred in the course of
the Director's activities on behalf of the Company are reimbursed at cost.
On April 30, 1997, the Company and its shareholders adopted a nonqualified
stock option plan ("1997 Plan"), which expires September 30, 2002, except as to
options then outstanding under the 1997 Plan. Under the 1997 Plan, the Board of
Directors may grant options to eligible employees at exercise prices not less
than 100% of the fair market value of the common shares at the time the option
is granted. The number of shares of Common Stock that may be issued shall not
exceed an aggregate of up to 10% of its issued and outstanding shares from time
to time. Options vest at a rate of 20% per year commencing one year after date
of grant. Issuances under the 1997 Plan are to be reduced by options outstanding
under a 1990 nonqualified stock option plan (replaced by the 1997 Plan).
Effective September 30, 1998, all outstanding employee stock options were reset
to an exercise price of $1.00 per share.
On September 30, 2002, options on 24,083 of Common Stock were extended to
December 31, 2005 and the option exercise price remained $1.00 per share.
On December 29, 2000, options on 43,375 shares of Common Stock were
extended for five more years and the option price was reset from $1.00 to $1.03
per share.
The Company currently has issued and outstanding options to purchase
101,791 shares of its Common Stock, at various exercise prices ranging between
$1.00 and $1.125 per share, to certain of its officers, Directors and employees.
See "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT."
ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information known to the Company
regarding beneficial ownership of the Company's outstanding Common Stock at
December 10, 2002 of (i) each beneficial owner of more than five percent of the
Common Stock, (ii) each of the Company's Directors, and (iii) all Officers and
Directors of the Company as a group.
Common Stock Beneficially Owned At January 7, 2002
Number of Shares Percent of Shares
--------------------------------------
Mirtronics Inc.(1) 896,311 41.0%
Investors Money Management (10) 340,000 16.6%
Genterra Capital Corporation 152,167 6.8%
Daniel S. Tamkin (2) 127,733 6.0%
Joseph Vitale (3, 4) 17,125 nil
Henry Schnurbach (4) 5,167 nil
John A. Poserina (3, 5) 17,167 nil
Dennis P. McConnell (4, 6) 4,167 nil
Mark Litwin (8) 1,048,478 48.0%
J. Ian Dalrymple (9) 0 nil
All Executive Officers and
Directors as a Group (5 Persons) 1,219,837 54.7%
- ----------
(1) Includes 310,000 shares of Common Stock issuable upon conversion of
debt owed to Mirtronics and convertible into shares of Common Stock. See
"CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS". Address is 106 Avenue Road,
Toronto, Ontario.
(2) Includes 10,833 shares of Common Stock issuable upon exercise of
options granted by the Company. Address is 96 Spring Street, New York, NY.
(3) Address is 209 Lafayette Drive, Syosset, NY 11791.
(4) Issuable upon exercise of options granted by the Company.
(5) Includes 9,667 shares of Common Stock issuable upon exercise of
options granted by the Company.
(6) Address is 96 Spring Street, New York, NY.
(7) Address is 106 Avenue Road, Toronto, Ontario.
(8) By virtue of his position as an officer and/or director of such
entities, Mr. Litwin may be considered the beneficial owner of shares owned by
Mirtronics Inc. and Genterra Capital Corporation. Mr. Litwin expressly disclaims
such beneficial ownership. Address is 106 Avenue Road, Toronto, Ontario.
(9) Address is 1200 Sheppard Avenue East, Willowdale, Ontario.
(10) Includes 170,000 shares of Common Stock issuable upon exercise of
warrants.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Company has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.
SYNERGX SYSTEMS INC.
(Registrant)
By: /s/ JOHN A. POSERINA
-----------------------
John A. Poserina,
Chief Financial Officer, Secretary
And Director(Principal Accounting and
Financial Officer)
Dated: February 11, 2003
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Daniel S. Tamkin, Chief Executive Officer, and John A. Poserina, Chief
Financial Officer of Synergx Systems certify that:
1. We have reviewed this amended annual report on Form 10-KSB/A of Synergx
Systems Inc.;
2. Based on our knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;
3. Based on our knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of
registrant as of, and for, the periods presented in this annual report;
4. The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) Designated such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this annual report is being prepared;
b) Evaluated the effectiveness of the registrants disclosure controls and
procedures as of a dated within 90 days prior to the filing date of this annual
report (the Evaluation Date); and
c) Presented in this annual report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrants other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrants auditors and the audit committee of
registrants board of directors (or persons performing the equivalent functions);
a) All significant deficiencies in the design or operation of internal controls
which could adversely affect the registrants ability to record, process,
summarize and report financial data and have identified for the registrants
auditors any material weaknesses in internal controls; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrants internal controls; and
6. The registrants other certifying officers and I have indicated in this annual
report whether there were significant changes in internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of our most recent evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.
Date: February 11, 2003
/s/ Daniel S. Tamkin /s/ John A. Poserina
-------------------- ---------------------
Daniel S. Tamkin John A. Poserina
Chief Executive Officer Chief Financial Officer
(Principal Financial and Accounting
Officer), Secretary and Director
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the amended annual report of Synergx Systems Inc. (the
"Company") on Form 10-KSB/A for the period ending September 30, 2002 as filed
with the Securities and Exchange Commission on the date hereof (the "Amended
Report"), I, Daniel S. Tamkin, Chief Executive Officer of the Company, and I,
John A. Poserina, Chief Financial Officer of the Company certify, pursuant to 18
U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of
2002, to my knowledge, that:
(1) The Amended Report fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Amended Report fairly presents, in
all material respects, the financial condition and results of
operations of the Company.
/s/ Daniel S. Tamkin
----------------------
Daniel S. Tamkin
Chief Executive Officer
Synergx Systems Inc.
February 11, 2003
/s/ John A. Poserina
-----------------------
John A, Poserina
Chief Financial Officer
Synergx Systems Inc.
February 11, 2003