Item 1.
Business.
ADMIRAL FINANCIAL CORP. ("ADMIRAL"), an inactive corporation, is currently seeking to recapitalize the Company in order to resume its prior activities with respect to the acquisition and investment in interest-earning assets and specialty real estate, as well as other new lines of business, as yet unidentified.
Admiral is presently conducting virtually no business operation, other than its efforts to effect a merger, exchange of capital stock, asset acquisition, recapitalization, or other similar business combination (a "Recapitalization") with an operating or development stage business which Admiral considers to have significant growth potential. Admiral currently receives no cash flow. Admiral anticipates no capital infusions prior to effectuating a Recapitalization. Until such time as Admiral effectuates a Recapitalization, with the exception of certain other professional fees and costs for such a transaction, Admiral currently expects that it will incur minimal future operating costs.
No officer or director of Admiral is paid any type of compensation by Admiral and presently, there are no arrangements or anticipated arrangements to pay any type of compensation to any officer or director in the near future. Admiral expects that it will meet its cash requirements until such time as a Recapitalization occurs. However, in the event Admiral depletes its present cash reserves, or in the event that Admiral management ceases to perform it's duties on a non-compensatory basis, Admiral may cease operations and a Recapitalization may not occur. There are no agreements or understandings of any kind with respect to any loans from officers or directors of Admiral on the Company's behalf.
This discussion may contain statements regarding future financial performance and results. The realization of outcomes consistent with these forward-looking statements is subject to numerous risks and uncertainties to the Company including, but not limited to, the availability of equity capital and financing sources, the availability of attractive acquisition opportunities once such new equity capital and financing is secured (if at all), the successful integration and profitable management of acquired businesses, improvement of operating efficiencies, the availability of working capital and financing for future acquisitions, the Company's ability to grow internally through expansion of services and customer bases without significant increases in overhead, seasonality, cyclicality, and other risk factors.
Item 2.
Item 2.
Properties.
Admiral Financial Corp.'s principal office is located in South Miami, Florida. The Company is currently being allowed to share, free of charge, certain office facilities and office equipment located at 7101 Southwest 67 Avenue, South Miami, Florida 33143. Admiral does not have any lease obligations.
Item 3.
Item 3.
Legal Proceedings.
On August 5, 1993, Admiral filed a Complaint against the United States of America in the United States Court of Federal Claims, arising in part out of contractual promises made to Admiral by the United States' Government, acting through the Federal Home Loan Bank Board ("FHLBB") and the Federal Savings and Loan Insurance Corporation ("FSLIC") pursuant to their statutory supervisory authority over federally insured savings and loan institutions and savings banks (hereinafter referred to a "thrifts" or "thrift institutions"), and in part out of takings of property by the FHLBB and FSLIC in the course of exercising that authority. On October 16, 2002, the Court granted the Admiral Motion for Summary Judgment in part, by finding that the United States Government liable for damages for breach of contract, pending the taking of testimony regarding a possible prior material breach by Admiral. A trial was conducted during December 2002, and testimony was taken regarding the value of the assets originally contributed by Admiral, and the Government's arguments regarding Admiral's prior material breach were heard by the Court. On August 1, 2003, the Court held in favor of the United States Government, stating that Admiral had committed a prior material breach when the Company did not meet the minimum capital requirement at March 31, 1989, despite the fact that FIRREA was enacted (on August 9, 1989) prior to the end of Admiral's "cure period" (October 16, 1989), thereby making such a cure impossible to perform. Admiral appealed, and the finding of the Court of Federal Claims was affirmed in August 2004. Admiral did not pursue this litigation any further.
Admiral is not a party to any other legal proceedings.
Item 4.
Item 4.
Submission of Matters to a Vote of Security Holders.
Not Applicable.
PART II
Item 5.
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
Admiral's common stock currently trades on the Over-The- Counter Market (often referred to as the Pink Sheets) under the symbol ADFK.PK.
On June 21, 1988, Admiral's common stock began trading on the National Association of Securities Dealers Automatic Quotation System (NASDAQ) under the symbol ADFC. In 1989, Admiral was notified by NASDAQ that Admiral's net worth did not meet the minimum standards for listing on the NASDAQ National Market System and that Admiral's stock would begin trading in the "over-the-counter" market after September 30, 1989, if the minimum capital standards were not met.
From September 30, 1989 until October 1999, Admiral's shares were listed in the over-the-counter market on the OTC Bulletin Board. Admiral was notified in October 1999 that as an inactive Company, trading on the OTC Bulletin Board would no longer be allowed. There is currently no firm making an active market in Admiral stock. The Company was notified of a change in the stock symbol from ADFC to ADFK in January 1999.
The following table sets forth, for the periods indicated, the high and low sales prices as reported on the OTC Bulletin Board.
As of June 30, 2010, there were 497 stockholders of record.
The Company has not paid cash dividends since inception. The Company anticipates that for the foreseeable future any earnings from future operations will be retained for use in its business and no cash dividends will be paid on its common stock. Declaration of dividends in the future will remain within the discretion of the Company's Board of Directors, which will review its dividend policy from time to time on the basis of the company's financial condition, capital requirements, cash flow, profitability, business outlook and other factors.
Item 6.
Item 6.
Selected Financial Data.
Admiral was formed in 1987 for the purpose of effecting a Contributed Property Exchange Offer and Merger and had no prior operating history. Admiral's acquisition occurred as of June 30, 1988. The following table sets forth selected consolidated financial data for Admiral for the five years ended June 30, 2008. In addition, selected financial data on the financial position of Admiral is shown as of June 30, 2010, 2009, 2008, 2007, and 2006. Such information is qualified in its entirety by the more detailed information set forth in the financial statements and the notes thereto included elsewhere herein.
Item 7.
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operation.
Results of Operations
Admiral was formed in 1987 and has had no operations since 1990. Admiral has been inactive since 1990.
Comparison of Years Ended June 30, 2010 and 2009
Admiral was inactive, and recorded no revenues or expenses during either period.
Comparison of Years Ended June 30, 2009 and 2008
Admiral was inactive, and recorded no revenues or expenses during either period.
Liquidity and Capital Resources
Admiral is currently inactive. There is no corporate liquidity, no available capital resources, and no immediately foreseeable prospects for the future improvement of Admiral's financial picture. Admiral management intends to seek a new line of business, as yet unidentified. In connection therewith, Admiral's management believes that a restructuring of Admiral may be necessary in order to raise capital for new operations, and any such restructuring may have a substantial dilutive effect upon Admiral's existing shareholders. Admiral has no known ongoing commitments or obligations.
Item 8.
Item 8.
Financial Statements and Supplementary Data.
The financial statements and schedules listed in Item 14 hereof and included in this report on Pages through are incorporated herein by reference.
Item 9.
Item 9.
Changes In and Disagreements With Accountants on Accounting and Financial Disclosure.
Not Applicable.
PART III
Item 10.
Item 10.
Directors, Executive Officers and Corporate Governance.
The following table sets forth, as of June 30, 2010, certain information with respect to the directors and executive officers continuing in office until their successors have been elected and qualified.
Certain background information for the director is set forth below.
WM. LEE POPHAM has served as Chairman of the Board and President of Admiral since its inception in 1987. He has also been an independent corporate planning and acquisition consultant since 1996, as well as the Sr. Vice President - Finance of IES Daniel Electrical Contractors, Inc., Miami, Florida, (a wholly-owned electrical contractor subsidiary of Integrated Electrical Services, Inc., Houston, Texas, -IESC)from 1997 to 2006; a Senior Sales Associate with Jeanne Baker Realty, Inc., Miami, Florida, since 2002, and Vice President - Regional Finance Director with AECOM Technology Corp., Los Angeles, CA since April 2006. He previously served as President of First Atlantic Capital Corporation, Miami, Florida (an investment company) from July 1983 to May 1985. Prior thereto, he was a Partner in the accounting firm of KPMG Peat Marwick, LLP, Miami, Florida, where he practiced as a Certified Public Accountant. He also served as a director of Cruise America, Inc.(AMEX-RVR), Mesa, Arizona (a recreational vehicle rental and sales corporation), which shares were traded on the American Stock Exchange until its sale to Budget Group, Inc.(NYSE-BD), from 1984 until 1991.
Item 11.
Item 11.
Executive Compensation.
Cash Compensation
The following table sets forth certain information with respect to the Chief Executive Officer, and each other executive officer of Admiral whose total cash compensation exceeded $100,000 during the year ended June 30, 2010.
Incentive Bonus Plan
Admiral has a policy of paying discretionary bonuses to eligible officers and employees based upon the individual's performance. Under the plan, Admiral and its subsidiaries distribute approximately 20% of Admiral's consolidated pre-tax profits in the form of cash bonuses awarded by the Compensation Committee of the Board of Directors, based on management's recommendations and evaluations of performance. No bonuses have been paid during the periods covered by this Report on Form 10K.
Retirement Plan
No Admiral employee is currently covered under any form of retirement plan.
In prior years, Haven employees were covered under a non- contributory trusteed pension plan, which was replaced by a contributory Section 401(k) plan for Admiral and Haven employees on March 31, 1989. Employees were permitted to contribute amounts up to 6% of their annual salary to this plan, with the employer providing matching contributions at a rate of 50% of such employee's contributions (to a maximum of 3% of such employee's salary), together with a discretionary contribution amount not exceeding 1% of covered compensation. No payments have been required to be paid during the periods covered by this Report on Form 10K.
Stock Compensation Program
The Board of Directors and shareholders of Admiral adopted the 1988 Stock Compensation Program (the "Program"), effective December 19, 1988, for the benefit of directors, officers and other employees of Admiral and its subsidiaries, including Haven, who are deemed to be responsible for the future growth of Admiral. Under the Program, Admiral has reserved 1,100,000 shares of authorized but unissued Common Stock for the future issuance of option grants. Options granted under the Program can be in the form of incentive options, compensatory options, stock appreciation rights, performance shares, or any combination thereof.
There have been no grants of any rights or options to any director, officer or employee of Admiral or any affiliate. The Company expects to distribute such option grants in the event of any Recapitalization transaction.
Employee Stock Purchase Plan
The Board of Directors and shareholders of Admiral approved the 1988 Employee Stock Purchase Program on December 19, 1988, enabling the directors, officers and employees of Admiral and its affiliates to acquire a proprietary interest in Admiral's Common Stock through a payroll deduction program. This plan has been suspended by Admiral management.
Employment Agreements
There are no employment agreements between Admiral and any of Admiral's employees.
Indebtedness of Management
Admiral has made no loans to its directors, officers or employees.
Compensation of Directors
While each Director is entitled to receive $500 plus reasonable out-of-pocket expenses for attending each meeting, each Director volunteered to suspend the receipt of all director fees due to Admiral's current financial condition, beginning with the meeting held during the third fiscal quarter of the fiscal year ended June 30, 1989. This suspension of payments includes additional compensation paid for attendance of committee meetings.
Item 12.
Item 12.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
The following table sets forth information regarding the beneficial ownership of Admiral's Common Stock as of June 30, 2010 by (i.) each person who is known by Admiral to own beneficially 5% or more of Admiral's Common Stock, (ii.) each Director and/or officer of the Company, and (iii.) all Directors and executive officers of Admiral as a group. Except as indicated below, each person has sole dispositive and voting power with respect to the shares of Common Stock indicated.
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(1)
Includes 46,278 shares held in a testamentary trust for members of Wm. Lee Popham's family, for which Mr. Popham disclaims beneficial ownership. Does not include any shares directly or beneficially owned by David C. Popham (his brother) or Jeanne M. Baker (his mother).
(2)
Includes 76,185 shares held jointly by David C. Popham and Valerie P. Popham, his wife. Also includes 119,928 shares held jointly by David C. Popham and Jeanne M. Baker, the mother of David C. Popham and Wm. Lee Popham. Does not include any shares beneficially owned by Wm. Lee Popham, the brother of David C. Popham.
Item 13.
Item 13.
Certain Relationships and Related Transactions, and Director Independence.
Wm. Lee Popham, together with certain members of his family (including David C. Popham and Jeanne M. Baker) and certain family affiliates participated in a transaction which capitalized Admiral in order to effect the acquisition of Haven Federal Savings and Loan Association, Winter Haven, Florida, in a contributed property exchange offer. The total historical cost of the property contributed by Wm. Lee Popham, his family and affiliates in the exchange was $1,228,227, the aggregate appraised value of such contributed property was $12,586,553, and the net contribution value was $7,022,965. Mr. Popham and his family and affiliates received an aggregate of 4,330,208 shares of Admiral Common Stock in the exchange, which occurred on June 16, 1988.
PART IV
Item 15.
Exhibits, Financial Statement Schedules.
(a.)1.
Admiral Financial Corp.:
(a.)2.
There are no financial statement schedules required to be filed by Item 8 of this Form 10-K, or by paragraph (d) of Item 14.