UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Amendment No. 1)
CURRENT REPORT
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Securities Exchange Act of 1934
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Common Stock, par value $0.0001 per share
(Title of class)
EXPLANATORY NOTE
The Company is filing this Amendment solely to provide the pro forma combined financial information required by Item 9.01(b) of Form 8-K that was excluded from the Initial 8-K in reliance on the instructions to such items. Except for the foregoing, this Amendment does not modify or update any other disclosure contained in the Prior 8-K. Such financial information was excluded from the Prior 8-K in reliance on the instructions to such items.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(b) Pro Forma Financial Information.
The unaudited pro forma combined statements of operations of ZRCN Inc. (formerly Harmony Energy Technologies Corp.) and Zircon Corporation for the year ended December 31, 2022, is attached as Exhibit 99.3 to this Form 8-K/A and incorporated in this report by reference.
(d) Exhibits.
Exhibits Number |
Description | ||
| 99.3 | Unaudited Pro Forma Combined Statements of Operations and Notes to the Unaudited Pro Forma Combined Statements of Operations. | ||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
| -2- |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ZRCN, Inc. | ||
| Date: June 27, 2023 | By: | /s/ John Stauss |
| John Stauss | ||
| Chief Executive Officer | ||
| -3- |
Exhibit 99.3
UNAUDITED PRO FORMA COMBINED
STATEMENTS OF OPERATIONS
On April 13, 2023, pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), dated as of April 13, 2023, by and among ZRCN, Inc. (f/k/a Harmony Energy Technologies Corp.) (the “Company”), ZRCN, Inc., a California corporation and a direct, wholly owned subsidiary of the Company (“Merger Sub”), and Zircon Corporation, a California corporation (“Zircon”), upon the terms and subject to the satisfaction of the conditions described in the Merger Agreement, including approval of the transaction by Zircon’s shareholders, Merger Sub will be merged with and into Zircon (the “Merger”), with Zircon surviving the Merger as a wholly-owned subsidiary of the Company. The Merger closed on April 14, 2023.
The following unaudited pro forma combined statements of operations, balance sheet, and related notes present the historical statements of operations of Zircon Corporation adjusted to reflect the Merger and has been prepared for informational purposes only. The historical consolidated financial statements and balance sheet have been adjusted in the Unaudited Pro Forma Combined Statement of Operations and Unaudited Pro Forma Combined Balance Sheet to give effect to pro forma events that are: (1) directly attributable to the Merger, (2) factually supportable, and (3) with respect to the unaudited pro forma combined statements of operations and balance sheet, expected to have a continuing impact on the combined results following the business combination. The unaudited pro forma combined statements of operations and balance sheet for the twelve months ended December 31, 2022, give effect to the acquisition as if it had occurred on January 1, 2023.
Unaudited Pro Forma Combined Statements of Operations
Year Ended December 31, 2022
| Zircon Co. | Harmony Energy Technology | Pro Forma Adjustments | Notes | Pro Forma Combined | ||||||||||||
| Net Sales | $ | 30,235,519 | $ | - | $ | 30,235,519 | ||||||||||
| Cost of Sales | (19,194,835 | ) | - | (19,194,835 | ) | |||||||||||
| Gross Profit | 11,040,685 | - | 11,040,685 | |||||||||||||
| Gross Margin | 37 | % | 0 | % | 37 | % | ||||||||||
| - | ||||||||||||||||
| Selling, Administrative and Other Costs | (9,659,113 | ) | (291,117 | ) | (9,950,230 | ) | ||||||||||
| - | ||||||||||||||||
| Operating Profit | 1,381,572 | (291,117 | ) | 1,090,455 | ||||||||||||
| Other Income / (Expense) | ||||||||||||||||
| Financial expenses | - | (47,121 | ) | (47,121 | ) | |||||||||||
| Interest Income / (Expense) | (405,488 | ) | - | (405,488 | ) | |||||||||||
| Stock based compensation | - | (36,000 | ) | (36,000 | ) | |||||||||||
| Depreciation | - | (430 | ) | (430 | ) | |||||||||||
| Gain on disposal | - | - | - | |||||||||||||
| Gain on lease termination | - | - | - | |||||||||||||
| Other Income | - | 16,731 | 16,731 | |||||||||||||
| Foreign exchange Gain / (loss) | - | 26,320 | 26,320 | |||||||||||||
| IP Enforcement (Expense) | (254,299 | ) | - | (254,299 | ) | |||||||||||
| Total Other Income / (Expense) | (659,787 | ) | (40,500 | ) | (700,287 | ) | ||||||||||
| Foreign currency Translation of differences | - | 31,787 | 31,787 | |||||||||||||
| Income before provision for income taxes | 721,785 | (299,830 | ) | 421,955 | ||||||||||||
| - | ||||||||||||||||
| Provisions for taxes | (1,484 | ) | - | (1,484 | ) | |||||||||||
| NET INCOME | $ | 720,301 | $ | (299,830 | ) | $ | 420,471 | |||||||||
Unaudited Pro Forma Combined Balance Sheet
Year Ended December 31, 2022
| Dec-22 | Dec-21 | |||||||
| ASSETS: | ||||||||
| Current Assets: | ||||||||
| Cash | $ | 112,925 | $ | 237,959 | ||||
| VAT recoverable | - | 54,947 | ||||||
| Accounts Receivable net of allowances | 7,588,818 | 10,895,341 | ||||||
| Other Receivables | 200,449 | 175,751 | ||||||
| Note Receivable from shareholder | 50,000 | - | ||||||
| Inventory net of reserves | 14,298,858 | 11,928,042 | ||||||
| Prepaid Taxes and Deposits | 822,526 | 226,647 | ||||||
| Total Current Assets | 23,073,576 | 23,518,687 | ||||||
| Non-current assets: | ||||||||
| Net Property & Equipment | 2,005,079 | 2,732,951 | ||||||
| Patents (Net) | 825,805 | 838,234 | ||||||
| Long Term Deposits | 89,656 | 123,109 | ||||||
| Total non-current assets | 2,920,540 | 3,694,294 | ||||||
| Total Assets | 25,994,116 | 27,212,981 | ||||||
| LIABILITIES: | ||||||||
| Current Liabilities: | ||||||||
| Accounts Payable | 5,436,775 | 6,482,607 | ||||||
| Line of Credit | 7,043,665 | 3,500,000 | ||||||
| Notes Payable | 410,000 | 410,000 | ||||||
| Accrued Expenses | 1,665,610 | 2,785,174 | ||||||
| Due to affiliate | 85,073 | 346,082 | ||||||
| Loan Payable | 502,928 | 189,717 | ||||||
| Loan from related parties | 78,205 | 464,653 | ||||||
| Total Current Liabilities | 15,222,256 | 14,178,233 | ||||||
| Non-current Liabilities | ||||||||
| Bank Note Payable | 270,834 | 680,834 | ||||||
| Shareholder Note Payable | 1,707,420 | 1,555,175 | ||||||
| Total non-current liabilities | 1,978,254 | 2,236,009 | ||||||
| Total Liabilities | 17,200,510 | 16,414,242 | ||||||
| EQUITY: | ||||||||
| Share Capital | 2,115 | 1,978 | ||||||
| Additional paid in capital | 1,791,185 | 1,653,822 | ||||||
| Accumulated other comprehensive loss | (5,021 | ) | (36,809 | ) | ||||
| Common Stock | 1,000 | 1,000 | ||||||
| Retained Earnings | 7,004,327 | 9,178,748 | ||||||
| Total Equity | 8,793,606 | 10,798,739 | ||||||
| Total Liability and Shareholder Equity | $ | 25,994,116 | $ | 27,212,981 | ||||
Notes to Unaudited Pro Forma Combined
Statements of Operations
Note 1 — Basis of Presentation
The unaudited pro forma combined statements of operations were derived from the historical audited consolidated financial statements and unaudited consolidated financial statements of Zircon and Harmony Energy Technology, and give effect to the acquisition as if it had occurred on January 1, 2023. The historical consolidated financial statements have been adjusted in the unaudited pro forma combined statements of operations to give effect to pro forma events that are (1) directly attributable to the business combination, (2) factually supportable, and (3) with respect to the unaudited pro forma combined statements of operations, expected to have a continuing impact on the combined results following the business combination. The unaudited pro forma combined statement of operations are based on a preliminary purchase price allocation, provided for illustrative purposes only, and do not purport to represent what the combined company’s results of operations would have been had the acquisition occurred on the dates indicated. They also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors. In addition, the unaudited pro forma combined statement of operations do not reflect any future planned cost savings initiatives following the completion of the business combination.